you own bmp -- bnp. why?eting against other investment banks will everyone else is retrenching. german banks cannot compete anymore. it does well in the corporate banking. retail banking is a headwind with negative interest rates. way bmp can do that at this stage. it is a dividend play. we do not think there is a lot of upside. very good returns on capital versus the peer group but it is more like utility now. we sold other european banks one by one but bnp we are more likely to seldom be buying up european banks. guy: u.k. banks look cheap with brexit looking easier right now? patrick:. . possibly we have been buying bonds. you get a 7% yield in dollars. that is the kind of return i'm so iting from banks prefer it with more safety from a bond. great on a u.k. unit. i was stunned by how they are at barclays. all around europe, we have more exposure in u.s. banks. they are more expensive but more sustainable and pretty double. go over the liberties of the big banks. ies ofbout -- validit the big bang spread w

first up, you just heard about it, bnp fixed income surged. revenue from the f trading up 35%. ubs overhaul continues. now, pretty much off a plane from vegas, is bloomberg's sonali basak. let's go to bnp. sonali: back to the european banks. alix: exactly. we heard from the cfo, and they talked about the rise in fixed income. here's what they had to say. >> when we go back to the fixed income products, basically both thorax and only g10, would basically stay there, and we've adapted the bank so that we could serve the clients in a digital way to a very positive solution. alix: trumping wall street in european peers? sonali: it's pretty impressive. you don't think of bnp as a fixed income king, by any means. you are watching people discern the winners and losers in .uropean banking everyone is looking where they are going to cut, where they are going to add. alix: who did they steal business from? sonali: that's a good question. d fixed income environment was a little better in general for everybody, but as we reported so far, ubs didn't have a

is this going to help bnp paribas?u look at the levers ecb has, they can shorten rates and do qe and have an impact. this can also have a negative impact, particularly qe. what else can they bring in? it is true banks have to deposit reserves at the central bank, which costs money. this is compensation for that. it is going to help upset the negative impact of negative rates? >> if you look at the overall 10 basist could offset points on the short term. however, the impact of what qe will do in the longer term is not within the reach of what is addressed. >> do you believe you have been or impacted bycb negative rates? at theou look overall overall growth, one could say it is intended. -- it is timid. that is why we have to see the impact of the latest events. >> do you expect negative rates to keep impacting? if there isok at some form of qe on the lower rates, that is probably going to have an impact. anna: that was the bnp paribas cfo. up next, should assets price out a recession? we will put that question to the ma

a third straight trading gain at bnp paribas.biggest bank reports a surge in revenue in the third quarter. euro area growth continues to be slow. you should look over all of what has been happening. one would say growth is still a bit dim. we will have to see what the overall impact is. manus: how to be your peers. that is what bnp paribas has done. a beat on revenue a beat on net income. revenue, 10 point nine. that is above the estimate of 10.7. 35% toncome surges by 915 million euros. in emerging markets. we saw the income decline by 15%. a lackluster market on flow activities. a warning on the ecb rates. new monetary policy easing at the end of the quarter. we are not going to see those until 2020. cost cuts, 1.7 billion. we are going to bring you our interview in full with the b.n.p. paribas cfo in the next couple minutes. ing has just hit the tapes. nejra: the third quarter underlying pretax profit comes in at 1.9 one billion euros. a comfortable beat on the estimate of 1.8 billion euros. it is also -- those are the key lin

the dutch company launched a buy back program part of the wider scheme to bnp in the banking space. the stock just modestly south. net profit coming in just below 2 billion euros. often some of the bank earnings will be a reading on the economy. just run us through the numbers and how they look. >> you are right it was slightly better than expected saying outstanding loans in france at about 5.9% was good news in a wide and slower trend in europe. france was actually a bright spot there for results overall net profits are 1.9 billion versus 1.8 forecast. that was mainly led by the civ division whererevenue was up showing the restructuring of the bank is doing well going ahead they are getting closer to their 2020 targets including the cet ratio reaching 12% for the bank. i caught up with them and asked them to give us a top line of how they are doing in their cib business >> if you look at bnp paribas, they are up 5%, so are the revenues even in this environment of low rates in europe. this as they crib to being diversified. on top of that, we have this revenue growth and kept on fo

withdoes bnp paribas do the technical construction of dollar canada?conomies which are more or less in sync. obviously the fed has a bit more easing to do. u.s. activity seems to be slowing. canada activity has been strong. likely to slow and the second half of the year in line with what the u.s. is doing. tom: should our viewers and listeners look at loonie as a commodity currency? >> it is a commodity currency but unless you get really big -- small movest less so. for us long-term fair value in dollar canada is around 1.29. don't see a lot of deviation from where we are right now. tom: bring up this chart. you are going to tear up over this chart. there it is. long-term canadian strength against pound sterling. guy: you would probably say that about a lot of charts unfortunately. wayertainly feels that particularly when you have to leave the country. you were talking about maybe a turn in that. have significant will it be? we are up 4% plus so far this year. >> there is still a lot of headwinds for currencies like the euro. there's still a lot of hea

viktor from bnp paribas is still with us.hink about the fed expanding its balance sheet? how quick and expansion do you expect this to be? viktor: as you said, it's not qe, at least not yet. look, i assume that what they have in mind -- matt: do you say that tongue-in-cheek? the phrase doesn't matter, does it? if he doubles the size of the balance sheet, it is some kind of expansion. you could call it q you're not. or not.-- ro -- viktor: it is certainly easier to accelerate once you are already in the mode. inssume that what they have mind is growing the balance sheet roughly in line with the growth of the nominal economy. is, of course, much slower than what they have done during previous qe. because we've seen time and again, the next step to accelerate purchases is fairly straightforward. nejra: huey is one side of the equation and so are the cuts. think theyess to did would disappoint and it would be a disconnect between the fed and the markets. you expect 100 basis point cuts from here. why? are you concerned about the

david: on earnings, let's bring in the head of asia-pacific equities research on bnp paribas.er to determine whether the market is cheaper not come you have toake an assumption whether the downgrade cycle is over and we have a graph that shows it is still falling. there might be something there. what do you believe? will this kick higher or lower? manishi: if you look at the trends of earnings growth estimates we are looking at now on consensus basis, 2019 for msci a is negative. the low base, consensus is forecasting 13.4% next year. is best rate to look at possibly to combine two or three years, and that would give you compounded annual growth rate of something like 5% to 6% across 2018. rishaad: how much of that is down to share buybacks? to know the s&p 500 in 2018 come came from that thing because people take advantage of the cheap money. manishi: in the case of asia, not that much. rishaad: how much? manishi: i would say it would be less than 10% definitely. i don't think it is even 5%, actually. whatever little growth you are seeing in asia, and is actually organic. we

all, there was a strategist over at p&p para bus that basically that-- over at bnp paribas says basically the expect is a handshake. hopefully, you do get some camera opportunities and some handshakes, but in terms of moving the needle, i do not think very many people have that expectation. what i keep saying, romaine, is that these relationships are not amenable to some kind of deal, like soybeans or whatever. you have got these two fundamentally different economic and increasingly geopolitical systems coming into contact with one another, rubbing up against each other, and it is really an issue of how you manage that relationship rather than waving a major quad, do a trade you, -- a magicng a made wand, do a trade deal, and everything is fine. of 2020, first half the gdp dipped to 1% or something like this, and if the rhetoric on the trade war gets worse, you may be in recession, simply because the consumer will lose faith in what is happening. caroline: a big investor they're saying we could be in recession if the rhetoric gets worse. do you think it will, or will things go down? tol:

paribas,rris of bnp and philip mcgraw. we go to abigail doolittle. take a look at the s&p 500, down 1.5%. ism printf by that yesterday, a second month in contraction for the manufacturing sector. lots of investors boosted by this, calling it an inflection point to the downside. it spread to the european section this morning. it's worst day since 2015. not surprisingly, investors going to havens including bonds in the u.s. the yen is rallying. investors moving out of stocks, into havens. as for the decline in the ftse 100, that's break it down by using the s&p 500. we are seeing a sea of red. the worst sector, health care, down 3.7%. -- as for the energy sector, the second worst year for the ftse 100. take a look at ftse. supply concerns, economic growth concerns continue to way. oil again, down seven days in a row, the longest losing streak of the year. not surprisingly, some of the biggest losers here and in europe are in the energy sector. look at chevron. space,metals and mining rio tinto. apple, and high-quality name that has been defended by so

bnp paribas posted a third-quarter gain in its fixed income trading business, outrunning wall streetpean peers, at the same time cutting costs. it has exited u.s. commodity derivatives. shell warning of a weak economic outlook. they say that could slow the pace of returns to shareholders. shell easily beat in the highest analyst estimates third-quarter profits, but the ceo cautioned that the company may not keep buying back shares at the current rate. the owner of british airways reported a drop in third-quarter airline'shit by the first pilot strike in 30 years. the ceo says if you factor out the strike, the company had good underlying results, but warns that the economic outlook remains soft. that is your latest bloomberg business flash. let's take you back to capitol hill now. voting has just begun on legislation affirming and impeachment inquiry of president donald trump. we are going to be taking you through that vote. representative steve scalise earlier said he doesn't anticipate any republicans will vote for the vote. we shall see. that vote coming up next. this is bloomberg.

what are some of bnp best investment ideas right now, daniel >> despite all this and the chaos that seemso be taking place in the uk, we are on the margin overweight risks in general. we do like equities and like credit and do like u.s. equities though one thing i have to mention you talk about earnings season we're in the midst of and a lot of companies reporting this week, we have to pay attention more necessarily than the actual earnings result is the guidance that we get from companies and the guidance we got last week was not very good. you had 25 companies report on thursday and friday and only four of them raised guidance, which is historically very low percentage even if the numbers seem to come in good or well for this quarter, if you have lower guidance through the rest of the year and into next year, the market is going to trade more on that than necessarily on their earnings. >> good luck trying to figure this out, daniel when and if you do please let us know and we'll get you back on "worldwide exchange. daniel morris, thank you very much. >>> well, we are just getting starte

bnp paribas, banco santander, credit suisse ray moment and holding this index back from bigger lossess look at the losers. roche, down .6% but a big heavy stock, so roche is off as is your letter -- unilever. roche is probably a issue of competition from novartis. unilever, down in sympathy with reckitt benckiser as it cuts its forecast. markets are opening mixed slightly to the downside. westminster is still getting all the headlines today. does boris johnson have the votes to push through his brexit from and will it emerge the house of commons looking anything like the agreement he brokered with the european union in the first space? -- place? with the latest, sebastian salek is standing by at westminster. run us through the timetable of votes this week. 7:00 without second reading, this is the first chance and he's have to vote on the implementation bill that would push through the brexit deal. if that goes through, and analysis suggests we might have those votes, the program motion sets out the timetable and this is when it gets controversial because the government really wants to

santander, loyds, bnp paribas, aviva, zurich insurance.ost all the gainers with the exception of asml, daimler, sap, are financial stocks, in the top 10 at least. the bottom 10, those taking the most away from the stoxx 600. smith and nephew at the top, down 3.7% this morning. keep an eye on what's going on there with smith and nephew. looking at the other losers, danone down 1%, unilever down almost 1%. these are the defensive stocks we looked at, that are not doing terribly well, but that's not necessarily a bad sign. deutsche of own and -- wonen, one of the big property owners in germany, down as berlin decides owners are not allowed to raise rent for the next five years, stocks like that will suffer. now, boris johnson will make a renewed attempt to win parliament backing for his brexit deal. the prime minister was forced to write to the e.u. seeking a three-month delay that he clearly doesn't want, after losing a crucial vote on saturday. but confidence is growing he has the support, even without that negotiating tool, of 320 mp's, th

joining us now for the hour, as guest host, michael sneed, head of derivatives strategy at bnp paribasexpect haitians of the market are pretty high for a vote -- expectations of the market are pretty high for the vote to get past. that would take cable to 1.35, ine targeting even higher the medium-term. you put cable fair value at around 132. michael: the way i like to think about it, take a step act from the politics and focus on the macro fundamentals. then we derive from that, where should it be trading? of 133.es us the value that tells us you have a lot of the risk premium taken out. the market would reenter long-term positions. those are not yet extreme but if they were to become extreme, that would be a sign that cable is starting to top out. we think we see most of the move with the risk. nejra: 140 is not that likely even if the deal does not get past. we think: -- michael: it is low 130's. where we think there is a little equities and also in credit. to be athere seems sizable risk premium priced in. we think pricing in about a 20%, 25% probability of a no deal brexit. nejra:

with cfoswe sit down of bnp paribas and ing bank. the calm before the storm, as u.s.t new highs. one trader is making a huge bet that volatility will erupt like it is 2008. that is next. this is bloomberg. ♪ ♪ nejra: this is "bloomberg daybreak: europe." let's get a check in on the markets in asia. great to see you. on another day of green on the screen. >> we have a bit of a mixed bag. a lot of optimism earlier in the day, which we got from a good sense of earnings out of the u.s. the fed rate cut prospect as well helped to propel markets at the start of the day. ultimately, that sort of ran out of steam. 0.5%.kkei up by nomura has gotten into profitability. business,retail domestic market for nomura hurting them. hang seng up by about 0.4%. we see a bit of action on this. liquidityis perhaps coming out of the system, which is perhaps responsible. the pboc, central bank not coming into the market to support what has been happening. let's have a look at one that has been acting as a bit of relief when it comes to equity trading in japan. it is video gaming stocks. we

thursday it is bnp paribas's ceo. bank. cfo of ing hopefully i got that name right.it along. let's talk about other issues. brexit tops the agenda. we had a breaking line come through suggesting france has agreed to a three month extension. there have been discussions that in might fight back against that. let's get back to martin malone. when we look at the brexit story, if boris goes to the country and gets an election, is there a demographic that that is a risk as he goes to the election? a lot of people saying the students are not going to be there, and that they are the linchpin in changing the vote at this next election if it comes through. how do you look at that? risk.is potentially a the issue about boris is he won the 20 leadership election in leadershipthe tory election. a lot of people did not expect them to get a deal. he did get a deal. we see the relationship with the irish leader and the french that boris has significantly improved those relationships. most people could see that. it's going to be detrimental to boris that he cannot get the deal done o

if you look at the numbers within the quarter for the entire market, bnp was still down over 20%.thy, growing at around 11%. we expect mass trends to continue to be fairly strong over the next two quarters, maybe showing a little bit of relative weakness compared to the third quarter just on more difficult comparisons. the vip market over the last month seems to be at least stabilizing. if that trend continues in vip, which we think it might over the next five months, and mass continues to hold up in the high sectordigit, the macau is set for a re-rating upwards. that is what typically happens in this space. shery: why would you see stabilization in the vip market when we see the chinese economy slowing down? >> the vip market is a very nuanced market in terms of what drives negativity. what we have seen over the past year with vip being negative, we just get into it is your comparison sexier. these comparisons always matter. you have one year of a pretty severe downturn. it makes the following year easier. your year-over-year negativity won't be as bad. if you look at what has be

we don't usually comment on bnp paribas.n part because of huge -- >> you talked yesterday about how much of the s&p is manufacturing. look, the dollar, in any situation where we're competitive, like caterpillar, we're going to lose. deere, we're going to lose if you can buy something in euros, it costs too much to buy our stuff. i tried to buy deere tractor in italy. the price of a porsche a tractor. the price of a porsche >> you didn't buy it in. >> no, it is the price of a porsche. >> what are you doing? >> trying to get a used european tractor. trying to buy a used european tractor. >> that's what they're hoping for. >> they're winning our stuff is so expensive over there, it is frightening p people don't understand. >> shouldn't it, though? >> jay raised rates so quickly because he wanted to cool the economy. how come he's taking his time? it is cool we got a soft landing. we don't want it to be a hard landing. i've had one of those on a u.s. airplane, it is nasty. we don't want that they form the runway >> you told us t