marilyn watson of blackrock financial is going to stick with us. vonnie: the u.s. 10 year yield is at 1.87 percent following yesterday's ecb moves. of course, a more positive tone on china trade as well. equity indices are higher. it looks like it might be another positive week, just fractionally at the moment. up dow up 0.3%, the s&p up 0.1%.d the nasdaq this is bloomberg. ♪ ♪ vonnie: live from new york, i'm vonnie quinn. guy: from london, i'm guy johnson. this is the european close on "bloomberg markets." let's check the bloomberg first word news. here's courtney donohoe. courtney: china making some trade concessions to the u.s., agreeing to buy farm products such as soybeans and pork. those will also be excluded from additional tariffs. the trade war has gone on for more than a year. negotiations set to resume in the coming weeks. consumers are the bright spot in the u.s. economy. retail sales rose in august by more than expected. shoppers hit auto show rooms and kept buying things online. the values of sales was up some 0.4%, after it was revis

li from blackrock is still with us.ioning ahead of this meeting in terms of your expectations of mario draghi? we think that this is probably the most important ecb meeting this year. there is room to surprise on the upside when it comes to the s and theref rate cut could be some sort of tearing announced -- tiering announced. but the chances of a broader asset purchase program has been diminished because of the dissenting voices. keept's not a bad thing to ammunition in the bank as you get further into late cycle so there is a bit more to add to the fire. so all in all, we expect a package, somewhat comprehensive, going into this meeting. as a result, we have become a more favorable upgrading equities from underweight to neutral and we still have an overweight position in government bonds. manus: any backup in yields? if you are still overweight, any backup on these ttp's or record lows, do they present buying opportunities in your opinion? tying back to your question of the day, what could be vulnerable should the ecb

i have kate moore here from blackrock as well. you want to weigh in here? you can address bill directly if you want >> bill, here's what i would say. i think that it's important for the fed to continue to react to the global circumstances this is where i am really concerned that if we step away, don't take into consideration what's happening on trade or the deterioration in european growth we will lead markets into an ugly place a more protracted and painful deterioration in the global economy our expectations is that the fed will continue to cut rates, this will be supported for risk access we need policymakers to put that support in markets stop panicking when policymakers start panicking in order for the markets to not fall into that panic, we need to note olicymakers are on the front foot from my view, it's important to take global considerations into account. >> i mean, you -- you have the multibillion dollar bond portfolio, i don't it seems to me -- >> on the equity side of it for what it's worth. >> fair point. but trump is starting this -- >> she st

harrison of blackrock.hairman piles wednesdays change because of mario draghi's thursday? you would think they anticipated the package from the ecb. i think they watch the dollar. i think he will look at the global context and look at domestic developments and there are signs that consumption is holding up well in the u.s.. the labor market has continued to perform solidly. now we are back to oil. pricel plays -- the oil plays an important role. so far there bit highlighted trade tensions, brexit, i think now oil comes back on the agenda. this affects the statement he will give. tom: is blackrock modeling global recession? do you get under 3% global gdp? absolutely not. our view would be in line with the midcycle correction scenario the chairman set up previously. i think he will be satisfied with developments since then. the domestic economy is not signaling recession. that is one of the reasons we are seeing that being priced out over the last week or two. the fundamental driver for this cutting cycle is

feed life stock these european banks are directly funding the forestation do it your bank and he blackrock in vanguard collectively on more than a $1000000000.00 in debt in just the 3 largest saw in the 3 largest cattle companies operating in brazil are these even banks often vocal about their sustainability policies. are also being accused of hypocrisy environmental campaign group amazon watch contacted them about their role in the amazon was fine as well deutsche bank and blackrock didn't respond b.m.p. paragraphs had this to say the m.p. paribus has been strengthening the sec to policies related to deforestation for several years and this prompted his clients to protect natural active systems and preserve biodiversity to the best of their abilities but that experts say is just simply not good enough we can encourage that use it finally is yours he can rule in requiring that the companies have certain standards their doubt deforestation commitments that they implement those commitments and that they were poor on their progress to address the deforestation with in their supply chains give

feed life's stock these european banks are directly linked the forestation do it your bank and he blackrock in vanguard collectively more than a $1000000000.00 in debt in just the 3 largest saw in the 3 largest cattle companies operating in brazil are these even banks often vocal about their sustainability policies. are also being accused of hypocrisy environmental campaign group amazon watch contacted them about their role in the amazon was fine as well for each bank and blackrock didn't respond b.m.p. paragraphs had this to say been people rebar has been strengthening insecta policies related to deforestation for several years and is prompting its clients to protect natural ecosystems and preserve biodiversity to the best of their ability but that experts say is just simply not good enough while we have applied the efforts of things like the p. to strengthen the seed gardens in their portfolio as our research demonstrates that another another process is playing out on the ground they are claiming to protect forests and poorest peoples in their official policies wow fuelling the destructio

blackrock,ategy for or does the repo battle, the repo debate, does it change the blackrock view?y what we just talked about, in terms of reasons behind last week's repo market volatility, there are things we can put our finger on. we feel like there is good reason behind why we have seen repair rates backing up. what is really important to note is that we are 10 years in to this recovery. the system is quite tight. thereare pieces here and that is coming under significant strain, and we need to put a lot of attention to those places for signs of potentially things going out of control, which is why we think as we continue to stay invested in markets, it is portfoliotant for resilience by also staying invested in exposures that give you diversification, such as gold and government bonds, because things could go wrong. sometimes we don't see that coming. tom: where are you expressing this in government bonds? where does blackrock own full faith and credit bonds? wei: well, what we currently have in terms of the view on government bonds is a preference for european government bonds

let's get back to scott from blackrock.e fact that there is a tit-for-tat and we don't have a date on when the u.s. and china will meet. source ofs is a big the fall in yields and pricing of the federal reserve to move. geopolitical uncertainty has many layers. the top layer might be behind us, but the other top layer is the china trade negotiations. there are other layers, hong kong, argentina being another one. i think we have to be conscious that if we solve one issue, maybe the next one comes popping up like the brexit did over the weekend. francine: what does the issue get solved? how much is it whether president trump once a resolution or doesn't want a resolution because it's good for the election? scott: i think it's a tough call because of the information set that we have, but from what we have discerned, we would say he wants to sort out the situation with china. it is important for him. it whether it is more important for him then his reelection campaign or not, they are probably related, but he has made this a b

tom: russ koesterich with us, with blackrock.at the markets going into october, the mystery of earnings season. what are you most focused on as we go into october? russ: a couple of things. what is the guidance from companies in terms of spending in terms of the consumer? we are focused on the risks. here is one sliver of good news. the u.s. consumer is in good shape. tom: you don't see that faltering? russ: i look at business confidence. the mechanism which starts to affect the consumer is when companies get nervous and pull back on hiring. this could upset the apple card and so far we are not seeing that. tom: we are near record highs. a lot of things are range bound, the dollar buttressed up against the recent range. what is the case of breaking out equities to higher prices or weaker sterling? russ: in equities, it comes down to earnings growth. if you look at the old country world index and look at global stocks, with the exception of the meltdown last december, we have been in the trading range now for about 18 months. this

joining us is ursula marchioni, the chief strategist for emea at blackrock's ishares.to my mind when i see the paper is looking at the technology, looking at regulation. in the past number of years, often times we have gone after the rock star active fund manager. much to our peril. what do we need to improve upon with data and regulation? or absolutely. good morning. asset star managers will always be important. i always read about active versus passive, but that is not the point. i guess it is just a different way investors are thinking about their choices. if you look at portfolio construction and portfolio returns, there are asset allocation choices which we discuss every day,, then there is timing from one area to another, and then, security selection, and i think it is difficult to be excellent at all for them. what we see investors who work with doing is focusing on the areas where they really excel, , it iss asset allocation a great way to express their views. and partners with great active managers on their area of expertise. it is about blending and using dif

group amazon watch contacted them about their role in the amazon was fine as well for each bank and blackrock didn't respond b.m.p. paragraphs had this to say been people rebar has been strengthening insecta policies related to deforestation for several years and is prompting its clients to protect natural ecosystems and preserve biodiversity to the best of their ability but that experts say is just simply not good enough while we applied fruits of the. street to the seed gardens. our research demonstrates that another another crisis is playing out on the ground there are claiming to protect forest and forest peoples international wow fuelling the destruction of the amazon there and back. because look this isn't see here that needs to be socially right home to these companies so that they better understand their role and also they can themselves be part of the solution rather than part of the problem without the traceability and the accountability of all actors involved including here in europe the fear is that our house will continue to burn. off paris or we have a bank to comment on their l

group amazon watch contacted them about their role in the amazon was fired as well deutsche bank and blackrock didn't respond b.m.p. paragraphs had this to say the m.p. paribus has been strengthening the sector policies related to deforestation for several years and this prompted his clients to protect natural active systems and preserve biodiversity to the best of their abilities that experts say is just simply not good enough we can encourage that is that family is here to take a role in requiring that their companies have certain standards the doubt deforestation commitments that they implement those commitments and then they report on their progress to address the forest issue with in their supply chains given that even if they're not producing these materials or directly clearing the forests they have a role to play in ensuring that that clearance doesn't happen without the traceability and the accountability of all actors involved including here in europe the fear is that our house will continue to burn. off powers what we have asked to comment on their links to the deforestation of the

rick rieder of blackrock, matt hornbach, and tiffany wilding of pimco will be joining john.tarts with a simple... hello! -hi! how can i help? a data plan for everyone. everyone? everyone. let's send to everyone! [ camera clicking ] wifi up there? -ahhh. sure, why not? how'd he get out?! a camera might figure it out. that was easy! glad i could help. at xfinity, we're here to make life simple. easy. awesome. so come ask, shop, discover at your xfinity store today. jonathan: from new york city for our audience worldwide. i'm jonathan ferro. "the countdown to the open" starts right now. ♪ jonathan: coming up, it is federal reserve decision day. a divided committee expected cut rates once again as trade officials get set to restart talks. larry kudlow says the mood has turned more optimistic. saudi arabia keeping the oil flowing, restoring output weighing on crude prices. good morning good here is your wednesday morning price action. futures down .1%. in fort exchange, the dollar stronger against everything through the morning. at 1.1055. back treasury yields lower by three basi

evy hambro of blackrock. it is jobs day.s is bloomberg. ♪ ♪ tom: this morning, and is jobs day in america, and america changed by a trade war. our two americas, one fully employed and some say underemployed two boris johnsons , one in search of a general election and one in search of a vote in parliament. the great globally commendation. china cut rates stabilize and promote the domestic economy. this is bloomberg "surveillance." francine lacqua on the shores of lake cuomo for the second coldest day of the year. that is an iceberg in the background. what is the site diced -- zeitgeist this september? francine: there is loads of headwinds. overall, it is a lot to do with the trade war. tom: the voice is going as well. we were there in march and it was freezing and it is even colder this year. we will let her get a break. right now warmer in new york, here is renita young. isita: china's central bank giving liquidity. the pboc is lowering the required reserve ratio by one half of 1% to release $126 billion of liquidity. in the

asset managers blackrock and vanguard are said to be falling short when it comes to fighting climateding to the nonprofit group majority action, the firm voted against at least 16 shareholder climate change proposals. there backing would've given the measures majority support. proposers have ended half the value of investment. vanguard says its engagement with companies can lead to meaningful changes. and that is your bloomberg business flash. it is time for our global battle of the charts. remember, you can see these on your bloomberg. gtv is the function. eric balchunas will kick things off. eric: value is back. everybody is talking about value stocks. be careful in picking. there is a huge dispersion of returns. they have different levels of value in them. gap in there was a 100% between the best-performing value etf's and the worst. behind me, you can see the two at the top are more devalue. they will have stocks you may not like, apparel companies. less holdings. more volatile. d, which isw is iw the best-selling value etf but it has a lot of beta, so not a lot of pop. when

of we: blackrock's head disciple strategy, sean connery -- sean connery -- john carney.onnie: joins us from the annual meetings in brussels. looking forward to the conversation. that is next. the canadian dollar is half a percentage weaker versus the u.s. dollar. boc holds fasthe interest rates. this is bloomberg. ♪ from the couldn't be prouders to the wait did we just win-ners. everyone uses their phone differently. that's why xfinity mobile let's you design your own data. now you can share it between lines. mix with unlimited, and switch it up at anytime so you only pay for what you need. it's a different kind of wireless network designed to save you money. save up to $400 a year on your wireless bill. plus get $250 back when you buy a new samsung note. click, call or visit a store today. >> the debate on extending the brexit deadline is one hour underway. is one hourng underway. you're looking at a former chancellor on his feet. one of the rebels last night of voted against the government. one of the rebels last night no longer ahewhip, member of the conservative part

marilyn watson, blackrock financial head of fixed income strategy, joins us.e marginally higher, but seeing major moves in bond markets around the world. the u.s. 10 year yield above 1.80% today. this is bloomberg. ♪ ♪ ♪ guy: 30 minutes left in the trading day here in europe. friday the 13th nearly done. from london come on guy johnson. vonnie: from new york, i'm vonnie quinn. this is the european close on "bloomberg markets." guy: european equities, to be honestat a headline level just going sideways. below the surface, things are interesting. there is a rotation taking place. bond proxies continue to be sold. we were -70 on german 10 years not that long ago. we are at -44 right now, so a pretty big move. bond proxies are being sold. mining stocks doing well. banks having a good session as well. also happening with european stocks, the pound is up by 8%. we are trading 1.2458. some expectation with jean-claude juncker and mr. johnson having a meeting monday that progress may be made away from a hard brexit. vonnie:

blackrock, the largest investor in the world sent a letter asking tough questions about manufacturers retailers about their practices. even the makes of the hugely popular game fortnite have taken steps out of gameplay including the combat shotgun. hey, maybe mitt romney was right when he said corporations are people too. which leads me to my survey question, go to my website smerconish.com and answer this question. will the private sector address our gun epidemic in a way that congress and president can't or won't. andrew ross sorkin joins me now. thank you so much for being here. were you caught off by surprise by walmart this week? >> i was, i thought that doug mcmillan might do something. i had gotten hints there might be something afoot. but i did not think it would be as public as it was. nor as forceful as it was. and i would contend to you, what he's doing in the stores is one thing. but the actual real change here, even beyond that is that he also wrote letters to the president. he wrote letters to pelosi, he wrote letters to congress, saying that the company now supports rev

liz: you are looking at, for example, dividend winners, blackrock, broadcom. guys, we have it on your screen. what you get paid just to wait. lockheed martin. that brings me to tom. she mentioned the etf but which etfs look attractive to you right now as the etf guy? >> well, as we were just talking about the fed, when you look overseas, there are some great opportunities in foreign equities, for sure, especially if the dollar comes a little bit higher. we get a stronger dollar, it's forced the valuations down in a big way. however, here in the u.s., a lot of money has been going into longer duration bonds and actually less credit quality bonds, into corporates and into high yields, where we are probably going to have one or two more rate cuts going forward. so last year it was a whole different story where rates were tightening, we were in a credit squeeze to a certain degree, then during that period of time, everyone shortened up duration. now it's safe to go longer in duration and lesser credit quality. we see billions that have been going into high yield a

from new york city, anastasia amoroso, rick rieder of blackrock, michael collins of pigeon, and fromp later on this program, reaction from the white house with larry kudlow. we will bring you that interview around 9:45 eastern time. counting you down to an opening bell 30 minutes away. your price action shaping up as follows with futures up nine points on the s&p 500.

alix: the blackrock paper from a few weeks ago talked about just this, but if you just allow fiscal stimuluso take place, it is never enough. there has to be a short-term joint action, which is very much like, we are going to borrow this much money, sell this much bonds, and have this kind of package. ian: you need to have that coordination. alix: isn't that dangerous? how do you get out of that kind of relationship? it is like a bad relationship you are in and can't breakup. ian: you grow your way out. the lesson of debt throughout the last 100 years is you cannot do debt deleveraging. the only way you can do that is by default or devaluation. you have to get that nominal growth picking up. that is going to be the big shift in monetary policy. romaine: but you need sort of a leader, too. in europe, maybe -- i mean, christine lagarde has shown she will have some ability to do that. you wonder in the u.s., who is leader who is going to bring those two together? ian: it is interesting to see that political leader taking over the central bank. that is the politicization of central banks coming

hampshire is peter fisher, dartmouth tuck school tuggle clinical and -- school professor and former blackrockhat was the biggest take away from the conference yesterday? peter: two things that go together. the first is this is a difficult policy choice the fed faces. the tariffs are a problem. global slowdown is a big problem, but the u.s. economy itself looks pretty good. that is a really hard choice, and you can see that in how the committee voted in the dissent and how difficult the forecast is. see how difficult it is. given how difficult and uncertainty forecast is, we now see how foolish it is that the fed is continuing to practice forward guidance. powell reduced yesterday to saying i know i published a dot plot, but pay no attention to it. he also said we might have to use forward guidance in the future. what are we going to you when we want to use it, tell us to please take the dot plot seriously? they've put themselves in a ridiculous dilemma by mount -- by not stepping back a year ago from forward guidance, and those played out across the press conference. lale: i totally agree. yo

you know, when we signed up to a new job and you pick a random pension fund from blackrock and fidelity they have an emerging market index. and those industries are increasingly including china. so our financial system has become the pensions of our teachers and other employees in our country are increasingly intertwined with china's financial system. so we should be aware of that at the very least. the final part on the lgfe bonds, i also view this as a positive development. i mean, for years economists have said you need to harden local government budget con stran constraints. that's effectively what they've done. they said we want this on book rather than doing it in shadows. it's a little bit more transparent. i think, again, this is an area that should be encouraged. it's okay for local government bonds to be used. in terms of the riskiness we don't really know because we haven't had an lgfe bond, you know, default. but in general, we should view it as high quality government paper because it's effectively going to be backed by the central government. so i think the developments in

onthe blackrock statement the united kingdom and europe, have we come to an end of this experiment? about where we are in the business cycle, we are in the last legs of this business cycle and getting to the end, if you look at the ecb, there is a lot more space to cut rates. -- clarifiedlatt that recently. the fed has said clearly they think forward guidance and asset purchases would be the way to go first. in terms of negative rates in is morend japan, there space for yields to go more negative. the brexithat does conundrum mean for global markets? pound initially rallied, almost thinking there would be some kind of concession or the 31st of october deadline was taken off the table. then the rally faded. what are the markets nervous about? diana: they are looking past the knee-jerk reaction and what the indications are going forward. more likely than not, if we do not get a resignation the u.k. is likely to ask for an extension. if that plays out, you have e.u.nged negotiations with -- with the e.u. and we don't know what the u.k. can ask for. the bank of england alluded to it. al

matt: thanks so much, james turner, head of european leveraged finance at blackrock. .cb sounds a note of caution on more quantitative easing, joining a big group. we discuss that and look ahead to christine lagarde's q&a for from parliament. that's next, this is bloomberg. ♪ matt: let's focus in on the european central bank policy. a member of the ecb has signaled a vote of caution on restarting quantitative easing, telling a french magazine the central bank does not have to use all of the policy tools at once. rollcall of others making hawkish, or at least not as dovish, noises. you can see them here. let's get to frankfurt and see what our ecb editor -- and speak with our ecb editor. how significant are his comments? >> it is important we hear what he had to say. those names you just mentioned those opposed to the last qe. nations andortant carry weight on the governing council. has already said to thinks all tools should be kept on the table. one would assume italy is pretty comfortable with more stimulus. his comments were pretty technical in nature and he clearly

sovereign debt and corporate debt, they buy stocks, they buy etfs and there was a suggestion made by blackrock it at this point but they have started quantitative easing all over again. so you know, they have $5.3 trillion in assets liabilities at their central bank which represents 43% of their gdp. we have $3.7 trillion at the fed which represents 18% of our gdp. we have room to move without going into negative interest rates. we should move, they should drop the rates at the fed to right above zero, so we can compete economically with them and we are also going to probably end up being in some kind of currency malaise with china as they keep lowering their currency as well. it's getting to be a mess. stuart: mark, you speak with clarity. you let us all understand exactly what's going on. my takeaway is, it ain't good. mark grant, thanks for joining us, sir. see you again real soon, promise. >> my pleasure, stuart. thank you, sir. stuart: our next guest has a very interesting article in the "wall street journal" today titled "the democrats' dilemma." i think it's all about middle of the road

appreciate the blah, blah, blah, the interest that someone is showing -- >> i would bet if you're a blackrock's actually a good day for you. >> right. >> yeah. i think that if you are inside at&t it is a very complicated day. >> complicated. >> at best >> you know, the other thought is generally when these things happen there's been discussion with management fwhoerds what they want them to do whether it's happened here or not, i don't know. it seems to me in many of these cases they've reached a point of concern with each other. >> do you think that's the case in this situation? elliott's not always -- elliott sometimes comes at it a little more quietly than others. >> they might. my guess is that they've talked with at&t management and they probably have reached a point of disagreement and have taken this action but i have no facts. >> you're a journalist you wrote a big book, andrew >> right. >> right now give me the at&t response to this how do you write it? >> the at&t response to this >> i want to hear it >> is we are in the midst of a major transformation of the company. we are 600 day