commerzbank is at the top but the average is 17. commerzbank traded up 36.ffer value on price-to-earnings ratio when you look at the broad european sector. they also performed really well in data. you got a weaker euro. the euro was 13% undervalued on u.s. dollar.ersus you have the potential for interest rate hikes priced in to one printers -- interest-rate europe. that would be positive for banks and how well they do. day, all off the the geopolitical uncertainty around the french elections has been removed and you have the german elections coming up in september, merkel looks to win that and it will be straightforward. the risk has been taking off the table. volatility as you have seen is back down at levels we last saw in 1993. when you look at the vix, likewise european volatility index well. this is a good time and valuations support the argument. matt: i wonder what you think -- since that risk is off the table, at least the european political risk, does that set free european banks to spend more money and consolidate to start churning a little bit? >>

we will be speaking to the commerzbank ceo later this morning. manus: voting is underway in south korea after a campaign dominated by scandal, trade disruption with the u.s., and growing worries about the unpredictable neighbor to the north. anna: shery ahn joins us from seoul. good to see you. what are you seeing on the ground? what are the key issues? shery: this is a holiday in south korea, but when it comes to what i have seen on the ground it has been busy heading to the polls. from very early in the morning, standing in line in election polls. we are hearing for the national election committee that voter turnout is around 56%. they are forecasting that it will be around 80% of eligible voters. course, intense interest. it is unprecedented, coming off from an historic ousting of the president, being dubbed by the korean media as a rosy election, coming in spring when roses bloom, instead of the usual december presidential election. a lot is hanging on the line in dealing with north korea. when i talked to a few voters outside polling station

let's kick things off with commerzbank. shares getting a boost after a one-off gain helped it beat first quarter forecasts. the second largest lender in germany saw net profits soar 28%. the ceo cautioned the bank needed more time before the growth could outpace the challenges of negative interest rates. annette joins us from tank fort this is one bank that can't wait for tightening by the ecb. >> yes, that's exactly the case. some analysts are saying that would -- that bank is actually a good bet on a tightening by the ecb. if interest rates are going to rise, commerzbank earnings will look most likely a little bit better than the last year's. as long as the low interest rate environment is per veiling. so l let me run you through the numbers. at first they look good, but as you look deeper, retail or private client and corporate clients, they posted a decline in operating profit in the first quarter compared to last year's first quarter. that was mainly on a muted client activity. when it comes to corporate clients and ag

commerzbank is focused -- commerzbank is focused on the german business. it would not affect -- brexit would not affect them as much as it would other european businesses. mark: what is the general sentiment on the floor towards german banks? the big two right now? matt: the big two are not very big. commerzbank is worth about 12 billion euros. deutsche bank is worth less than 40 billion euros. together, they are not even a $50 billion valuation really for the two biggest german banks. if you look at the biggest french banks, you are looking at a 100 billion dollars valuation. the german banks have been under pressure. they have come back a lot this year. commerzbank shares are up i think 32% today. they are handedly outperforming -- european index. bank index. they have come back from a low level after a difficult 2015 and 2016. mark: matt, good to see you. matt miller reporting from frankfurt. vonnie: let's check in now on first word news. emma: and south korea, centrist korean presidential candidate has exceeded -- has accepted defeat. he has accepted t

tom: matt miller, thank you so much on commerzbank.ith us this morning are vincent chaigneau and alberto gallo. three out of five major banks in europe are french. can mr. macron make france increasingly more dominant? the idea of a capitalist revolution in paris that will make france even more competitive with the german banks, is that feasible? >> there is eternally an attempt from france to a trying to some of the bankers, people from the financial industry in paris, and especially after that election haslt, the risk there diminished quite sharply. more is an attempt to sell business friendly environment an d indeed, try to benefit from this brexit situation. guy: i have a chart up, which is european banks. they have been on a tear for quite some time. a, what does that tell mario draghi and b, are they telling going to upset the party? -- are the italians going to upset the party? italians in general. >> the banks were the most involved in the equity market one fear ago and there were so many fears about breakout risks. this preven

commerzbank today reporting better-than-expected trading results.e of these banks is in the middle of a turnaround plan. >> i am still worried about european banks. structurally -- don't get me wrong, i think they are all trying to do the right thing. u.b.s. is probably further ahead than the rest in becoming a wealth manager. lloyds has done particularly well by becoming a pure u.k. retail bank, but they are still being hurt by the j.p. morgans and goldmans. they are still really dominating investment banking globally now. juliette: turning to the u.s. economy. last week, president trump told bloomberg he is actively considering a breakup of giant wall street banks, giving a push for the return of the 1933 glass-steagall act. this week, bloomberg's chief washington respondent -- correspondent kevin cirilli spoke with u.s. senator elizabeth warren about the possibility of working with president trump to revive the 1933 law. sen. warren: you bet. i am ready. >> how realistic is it? sen. warren: i am ready. i already have the bill. remember, i have a

. >> commerzbank has reported a net income ahead of all estimates.n the270 million euros latest month. i had of the average forecast of 74 million euros. commerzbank says it is still hoping to keep its ratiat2% or above. >> i think he basically is that the strategy that we have announced at the end of last year is the right thing to do. thewe with a good start into the year. that mnshat the strategy is on track so far. that is comforting. a net income of $1.4 billion. they thanked it partly to the strength of the banks in the turkish division. >> are you sure of the market's optimism? >> we are optimistic. it is not the market we would be looking at. i would rather look at the amount of clients. they have gone up from a total million -- it is the total in terms oclnts. if you look at primary clients, it is 9.85, as mentioned, the total amount of loans we may net is 5.7 billion this quarter. we do see client growth on our side. that is the part following the fincials. that is the part that makes me happy. i'm optimistic about that part. those reportin

juliette: commerzbank has reported a net income ahead of all estimates.70 million euros in the latest three months. an average forecast of 74 million euros. commerzbank sayst still seeking to keep its tier one ratio at 12% or above. basic belief is that the strategy we have announced at the end of last year is the right thing to do. i think q1 was a good start into the year. a decent result, that means that the strategy is on track so far. that is comforting. anna: ing reported a net income of $1.4 billion. beating expectations. underlying pretexbe estimates due partly to the strength in its turkish banking division. do you share the markets opmi? >> we are optimistic. at the same time, it is not so much the market we wod looking at, rather the amount of clients. ofhas gone up from a total 36 million is the total in terms of clients and if you look at primary clients, it is 9.85 and as mentioned, the total amounts of loans we may net is 5.7 billion th qrter. we do see client growth on our side. that is really the part following the financials. that is the

joining us will be the top forecaster of china's pmi from commerzbank.ill also be looking at what the data means for the nation's currency, the end, with mcquarrie's head. all of that coming up. this is bloomberg. ♪ betty: this is "daybreak: asia." i am betty liu in new york. yvonne: yvonne man in hong kong. less than an hour until the latest china pmi data crosses the terminal. who better to give us a steer on the way things are going then the top pmi forecaster. he is a senior emerging markets economist at commerzbank and joins us live from singapore. how great to have you. we continue to see the trend, pti prices cooling down, iron ore in a bear market. china's deleveraging seems to be taking a bite into the economy at the moment. is the china reflation story over? >> i think it looks like the alreadyas ticked in q1 in china's growth profile. if you look at the pmi, i think this morning we are going to see a moderation as well. i think we have to look at at least three factors at this moment. one is the indicators in april have already showed relative

commerzbanking as reported an increase in net earnings for the first three month of the year -- monthsthe years. workers at a plant specter in france have ended a strike and returned to work. over the weekend, unions gave in and signed a deal outlining the terms for the factory to be closed. the future of the whirlpool site grabbed international headlines last month when both macron and marine le pen spoke to workers there on the same day, hoping to curry support and show their sympathy for the struggling working-class. allison sargent has the story. the media blaze has finally died down, and employees of whirlpool are returning to work, but their days back on the job are numbered. on friday, they signed a deal with employers, excepting the factory's relocation to poland next year. in exchange, unions negotiated compensation, including severance pay of up to 70,000 euros. >> we signed this deal, but we were not proud of it. >> everyone will be thrown out, like dirty tissues. >> whirlpool employees were thrust into the spotlight two weeks ago when france's presidential finalists and mad

. -- abu dhabi commerzbank.is looking good for america in terms of trade, we have the positive comments from g7 leaders, we also have the announcement of the u.s. china trade deal. has the world got more comfortable with the notion of america first? >> we live in a world of excess supply and at the same time the u.s. is the buyer of last resort --ch means the world needs for global growth to persist we need u.s. growth and thus its trading partners are actually quite willing to make pragmatic deals with the u.son bilateral basis. chinavery clear with where in fact that much has not happened, there have not been that many accommodations when it l and autoters in stee part but there has been an upturn in the long run with bioengineering and agribusiness the guidelines are proved so the u.s. companies can do that. as long as it remains of this bilateral deal then the trading partners of the u.s. are quite willing to do some damage limitation. i don't think it is good for global growth that the u.s. takes partners w

credit research for commerzbank. great to see on the show.e here, ey went the extra mile but they don't have anything to show for. oil taking a tumble. where does the story go from here? does it matter whether they extend are not? ultimately, now the saudi energy minister is implying that cuts should be extending in the second half of the year. so they are struggling to me up with clever ideas to rebalance this market? >> i don't believe that opec has many options to continue its existing policy of cuts. there is obviously some cloud of skepticism if it is working or not. i think it is a bit too early to put so much of a judgment. we are not yet even six months from the original agreement, so definitely a think opec needs some more time to establish the outcome of its policy. a good thing is also we are starting to see renity with opec members, which was not the case last year. now you have saudi very openly speaking about the cuts, even extending beyond the anticipated timeframe. members seem toe agreement with the policy and obviously the m

opened's commerzbank has up 3000 employees.r say $34,000r includes a sweep to cut 9600 jobs over the next four years. mark: that is your latest bloomberg business flash. vonnie: time now for our bloomberg quick take where we get context and background on issues of interest. leaders are looking at choosing not to make any significant policy changes on the issue of climate. it might just be the world's most controversial universal idea. the united nations declared it inalienable human rights. the discord starts when it comes to who deserves sanctuary. whether they can survive the flood of refugees and the backlash of antipathy towards outsiders in some countries. still taking off, u.s. resident donald trump issues an executive order temporarily freezing entry from anyone from muslim countries. u.s. judges still put the restrictions on hold. europe nationalist politicians have gained strength by questioning the wisdom of accepting refugees. attacks on europe and the u.s. by killers linked to or inspired by the islamic state have s

juliette: commerzbank has reported first order that income ahead of all analyst estimates.as 217 million euros ahead of average forecasts of 74 million euros. it says it is still speaking -- seeking the ratio at 12% or above. >> i think the basic belief is the strategy we have annoce at the end of last year is the right thing to do. i think q1 with a good start into the year and decent results proves the strategy is on track so far. it obviously is convincing. >> i.a.g. reported first-quarter net income of 1.1 4 billion euros, beating expectations. thanks partly to strengthen the turkish banking division. how optimistic are you going forward? do share the market's optimism? >> we are optimistic. t e same time, it is not so much the market we will be looking at. i look at the amount of clients. ofhas gone from a total 36 million total in terms of clients. if you look at primary clients, it is 9.85. as mentioned, the total amount of loans we made net is $5.7 billion this quarter. we do see client growth on our side. that is really part of following the financial. that wt make

commerzbank, the german lender, number two in germany today. estimates it benefited from a rise in income from its trading business, just six months after it rolls out its strategy to scale back that business revenue from its core retail and corporate businesses. this is a company in the throes of a turnaround strategy. the chief executive announcing 9600 job cuts by the end of 2020. and the sale of an at ways market. the commodities division restructuring, low rate risk revisions for the portfolio. chairs by the way today were roughly up to a 60 month high. let's finish up with bank of america merrill lynch. has fallen to its lowest levels since october of 2014. we are going to talk about that in just a second. this is a measure of future price wings supplied by options markets in global rates. equities, commodities, and currencies. the global uncertainty index has come down as well. it reached a record high in january. should we be worried? the first question i will ask sid in a few minutes. vonnie: it might be but if i get depressed -- to as

commerzbank reporting a 28% jump in net profit topping analysts forecast.he german lender helped by an increase in income from trading securities. >>> dialog semiconductor posting better than expected earnings but current quarter rev ni wenu weak. apple, their biggest customer s developing an in-house solution to replace the power management ships. elliott advise seniors lunching legal action against akzo nobel. the activist investor says the paintmaker breached duties to shareholders by rejecting ppg's third takeover offer yesterday. elliott is asking for a dutch court allow a vote to oust the chairman. >>> in financial news, goldman sachs making the biggest changes to investment banking leadership in a decade. greg lemkow and mark nakman will join john walder as co-heads of the investment banking unit. waldron will sit down at 11:15 with cnbc this afternoon at 2:15, a conversation with lloyd blankfe blankfein. >>> in other news, technology, amazon is preparing to launch an improved echo. the new device features a seven-inch touchscreen and a camera for vi

they have problems, even commerzbank, with a portfolio and shipping.he u.k., the government still owns and controls royal bank of scotland. we paid off tarp a long time ago. iny have moved very slowly europe. i think they're finally coming around now. except italy. michael: banks tend to move to the lowest common denominator when following the regulations as they try to compete. if the united states backs off dodd-frank, does that affect the rest of the world? does the rest of the world have better regulation than the u.s. because they have headed in that direction, or do they back off as well? >> that is the key question. the europeans, just having come back from europe, are very concerned as to what the new administration is going to do. i think you will have a new banking supervisor. dan cirillo is gone. whoever comes in there, and there are a lot of names being floated around, but i think you will see a more moderate stance on enforcement of these. particularly in the small and medium-sized banks. i don't see that dodd-frank is going to be overturn

in germany, commerzbank sent out early retirement offers to about 3000 employees.eople familiar say the offer includes a $34,000 -- they wanted cut 9600 jobs over four years. david: the honeymoon period just may be over. if president bullard says the markets are to maintain gains, washington is going to have to deliver on policy expectations. business confidence numbers shot up after the election. the president was perceived as more pro-business than the previous administration. washington does have to deliver at some point and i think that is a concern going forward whether the honeymoon period would end at some point and maybe the reality of american politics would settle in. we will see if that happens or not. i think the jury is still out on all of that. david: still with us is jason schenker of prestige economic and chris watling of longview economics. we have talked a lot around this table of whether or not the s&p staying where it is is because people expect the trump to deliver something or on the contrary, whether there are fundamentals supporting the mark

with us, james bevan, chief investment officer at ccla investment management and peter dixon from commerzbankjames, do you believe equities are now fully priced? >> i was talking about 2400 as a year and target for s&p 500. we are at 2400 already. we are very dependent on mr. trump delivering on deregulation and cutting taxes. francine: where do we go from here? correction, or where does it go next? >> low growth, low interest rates. people will pay very high prices to participate in equities. if you really believe in zero interest rates, you should pay 100 times for the earnings. you need to but risk into the equation. if we believe the u.s. economy is thecover, the 2700 upper limit. francine: peter, are we feeling a lot better about the world economy? is growth, for the first time in a long time, upgraded? >> from a european perspective, we are a lot more comfortable. we are on slightly more solid footing. my sense is, we are nine years on from the financial crash in 2008. it normally takes that time for the economy to find a bit more momentum after that crash. we are getting there. i am a