they are studying ways to make it easier for the country's biggest lender to merge with commerzbank. they could amend the tax law to make any gilmore advantageous. -- any deal more advantageous. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. vonnie: i just want to point out trump'shael cohen, former lawyer, has arrived at court. the sentencing hearing is today for the in august he pleaded guilty to eight felony charges and one count of lying to a bank and to campaign-finance violations. it will be the next chapter in the mueller investigation. we will get that sentencing presumably today. this is bloomberg. ♪ guy: live from london, i am guy johnson. vonnie: from new york, i am vonnie quinn. this is "bloomberg markets." guy: the pound had a reasonably good day today, climbing on speculations that theresa may will defeat a challenge to her leadership from t

joining us from frankfurt, an fx strategist at commerzbank. great to have you with us.h for joining us today. we for just talking about the fact we saw a bounceback in u.s. equities today, u.s. futures pointing a little lower. what has been interesting for all this, dollar-yen. yen strongly bid in the last 10 sessions. this trend in dollar-yen, yen bid, is it likely to continue, considering the market is pretty shortl ythe yen? >> we have always been quite bullish on the yen, because i think what the market has not been realizing is that the bank of japan is firmly on a path of exiting from its ultr a-expansionary monetary policy. was tost thing it did flexibleize the yield range and let the 10-year yield rise as much as 0.2%. this was the first step, and i would expect there are more steps to follow, because what we see, the bank of japan is increasingly worried about the banking sector. this is why they have changed their yield target. and my view, this is a very powerful, positive argument for is yen, because inflation still relatively low in japan. the bank of japan

this is oppenheimer versus commerzbank. they talk about eurosterling.hey would say sterling has most of its toxic political news data. the euro does not have the same level of toxicity. it could rally. 85,sterling could rally to 87 because of that political differential. is there a basis for that argument? guest: i would say if you look at eurosterling, it's not because it was great in the u.k. or europe, there's a risk on both sides of it. that could be the case again. manus: we'll talk about those risks in terms of what comes next. 8983, what does it take to reprice those highs on the year? still ahead, legendary oil trader. some know him as god. why? watch bloomberg's a specific conversation with him later this hour. up next, the fed is seen pulling the trigger at this week's meeting, slowing the pace of hikes into next year amid downside risks. this is bloomberg. ♪ manus: this is the fed's big week. the economists surveyed by bloomberg said they would pull the trigger on another hike before slowing the pace of increases next year. as the risks to th

are studying ways to make it easier for the country's biggest lender to work with -- merge with commerzbankares of under armour fell the most in four months today. they disappointed investors with its long-term outlook. under armour expects annual growth in the low single digits from 2020 to 2023. before today shares were up 45% for the year. elliott management has taken a stake in the french maker of james and whiskey. they want changes in their governance. he says the company has lost market share and underperformed its peers. that is your business flash update. i'm looking at is tesla because elon musk might be getting the last laugh. at one point is here and analyst calling the stock un investable, but now soaring to new highs. amanda: that surprise profit is producing vehicles. keep your eye on the bonds. they continue to signal caution on the sophisticated investors. the stock back to the previous high levels, the bonds not so much. 1 especially -- those especially given vehicles are costing more than $60,000 now. of our interviews can be found on the bloomberg with the function tv

coming up, germany wants to help deutsche bank by making it easier to merge with commerzbank. more on the details, it's a bloomberg scoop. and clashes between italy and the e.u.. how will the commission react? and if you're traveling to work, you know what to do, up on to the radio, were live on digital radio in the london area. this is bloomberg. ♪ nejra: i'm nejra cehic at westminster covering the day after theresa may's no-confidence vote. i'm manus cranny into by. changed,music has dancing closer to the chinese. day on crudeured yesterday, down by 1%. opec suggesting there could be deeper cuts to come. the narrowest trading range since february 27. how's it looking for you this morning? nejra: we are seeing futures pointing higher on the s&p, largely on trade hopes. cable had its biggest run-up yesterday in more than a month. theresaet was expecting may two when that boat and she did, but the question becomes whether her hand is weakened both in brussels and also back home. futures a little soft in today's session. , isl shares in the u.k. there value if you believe theres

like if it bank be is deutsche bank and commerzbank combined?en deutsche bank or commerce banker confined, why -- combined -- commerzbank combined, why? this would not change much when they would join forces. they would also need to find the right business model for this which supplies lots of banking services already and is highly competitive. david, thank you for answering that delicate final question. right now in brussels, a different part of this european modernty, on architecture in brussels. taken, maria, but the idea of the eu giving prime minister may all of 10 minutes at dinner tonight. they have some other things to worry about, don't they? >> they have many things to worry about, the european but it is a 2019, big thing because it will be the ultimate fight tween the establishment and populous. today she will get to talk for 10 minutes, very unusual, but given the political commotion yesterday, not much has changed. they think the u.k. will leave the european union with the deal for a number of reasons. nobody wants the u.k. to crash

hit household spending joining me now from london is peter dixon peter is a senior economist with commerzbank good to have you with us so peter to what extent has been an expensive miscalculation so far what do economists say. i think that's a very good way of putting it really i mean i think when you look back to three years ago those people who pushed for bread cheat i don't think expected to win the cold never had a plan to deliver in the event that they did so now we've wasted an awful lot of time and effort since the referendum trying to figure out how to deliver bragg's it which it's not even clear that the electorate now wants so it has indeed been very expensive both in terms of absorbing government time. the energy which businesses now have to spend in order to prepare for something which frankly may not even yet happen how expensive though how much does it cost the u.k. economy do we can we put a number on it broadly speaking g.d.p. is about two percentage points below. where it would otherwise have been in the absence of bragg's it and that can be calculated in in a number of ways

to argue many voters are beginning to ask if it is an expensive miscalculation peter dixon from commerzbank has more i think when you look back to three years ago those people who pushed for bread i don't think expected to win the cold never had a plan to deliver in the event that they did so now we've wasted an awful lot of time and effort since the referendum trying to figure out how to deliver bragg's it which it's not even clear that the electorate now wants so it has indeed been very expensive both in terms of absorbing government time. the energy which businesses now have to spend in order to prepare for something which frankly may not even yet happen g.d.p. is about two percentage points below. where it would otherwise have been in the absence of bragg's it and that can be calculated in in a number of ways we know it's a bit like saying you know we've all been. last year's growth. over of a two year period which is you know quite a quite a considerable quite a considerable sum. so without putting a precise figure on it i think it's fair to say the numbers being well i think on the on

peter dixon from commerzbank has more i think when you look back to three years ago those people who pushed for bread seat i don't think i expected to win and they can never had a plan to deliver in the event that they did so now we've wasted an awful lot of time and effort since the referendum trying to figure out how to deliver breads it which it's not even clear that the electorate now wants so it has indeed been very expensive both in terms of absorbing government time. to the energy which business is now have to spend in order to prepare for something which frankly may not even yet happen g.d.p. is about two percentage points below where it would otherwise have been in the absence of bragg's it and that can be calculated in in a number of ways when that's a bit like saying we you know we've almost lost a year's growth. over of a two year period which is you know quite a quite a considerable quite a considerable sum. so without putting a precise figure on it i think it's fair to say the numbers being well i think on the on the current. projections on the assumption that we don't

hit household spending joining me now from london is peter dixon peter is a senior economist with commerzbank good to have you with us so peter to what extent has been an expensive miscalculation so far what do economists say. i think that's a very good way of putting it really i mean i think when you look back to three years ago those people who pushed for bread to eat i don't think i expected to win and they could never had a plan to deliver in the event that they did so now we've wasted an awful lot of time and effort since the referendum trying to figure out how to deliver bragg's it which it's not even clear that the electorate now wants so it has indeed been very expensive both in terms of absorbing government time. the energy which businesses now have to spend in order to prepare for something which frankly may not even yet happen how expensive though how much does it cost the u.k. economy do we can we put a number on it broadly speaking g.d.p. is about two percentage points below. where it would otherwise have been in the absence of bragg's it and that can be calculated in in a number

the german government is looking into ways you can help and a potential merger of the lender and commerzbankus promise by the ceo that he does not make -- plan to make any strategic moves over the next 18 months. the merger talks are at an exploratory stage at this point. that is your bloomberg business flash. back to you. david: it is interesting to me. everybody seems to want deutsche bank and commerce back to get together except deutsche bank and commerzbank. alix: and some analysts. one wrote that any deal which are a painful and costly restructuring. it would cost about 3.8 billion euros. david: the german government is behind it. 22,000 people losing their jobs. that is not very appealing from a political point of view. alix: change the rules. that makes sense. change the rules to make it work out. david: the main acid deutsche bank has is its name. the german government will not let deutsche bank fail. we have to change some roles, we will change some roles. staying with banks. it has been a brutal to much for andasset managers, thanks. the conversation a couple of weeks ago was like

the german government is said to be intensified effort to merge it with commerzbank., really interesting to watch. there are record lows over and over again. various ceos try different solutions. joining us to discuss all of this is the bloomberg german bank reporter. what is the government now planning to do? the government is really taking steps to help deutsche bank as well. they are making changes to the tax code that will make it easier for deutsche bank to merge. it is preliminary and exploratory but a sign that the german government is interested in this. good morning to you. it is exploratory. what can it really mean for the markets? the market is seeing that berlin is taking steps. this increases the chances it will happen. it will make it easier and less costly. when ever the merger is being discussed, it could potentially have positive consequences. there is a lot of concern. it will plunge the banks into a long restructuring. what do these two managers think about the idea? are they fighting against it? i don't think they are fighting against it. i am sure

it may include a merger with commerzbank.dication that berlin is beginning to worry about what is happening in frankfurt? >> they have at least been watching carefully what is going on in frankfurt for a while. belieft, that is the that i have. they are concerned about the situation at deutsche bank. in the past, they have had a very hands-off relationship with the bank, and now they are and areing helping it weighing options. for example, a change in the tax we have apparently what been told, and that could pave the way for a merger at some point down the road. ♪ juliette: you mentioned sterling and this bloomberg function on showing how obvd volatile it has been. i don't want to overwhelm you with this cool graphic, but what it shows is demand for sterling is exceeding demand for sterling calls at the rim area on this curve. it means that there is a weaker pound over the next six months. juliette: there are 30,000 functions on the bloomberg and we enjoy showing you our favorite. maybe they will become your favorites. here i

germany stepping up efforts to ease a merger between deutsche bank and commerzbank. discussions have included the finance ministers and deutsche bank ceo. it is all over how to combine these two biggest lender's in the country. talks include tweaking laws to make the merger less costly. deutsche bank is in a vicious cycle of high expenses and falling revenue. shares of a hong kong listed company fell for the second day, 10% over two days, when it resumed trade following a critical report from a short seller. allegations about its financial health are groundless, they say, and it is considering legal action. it is a chinese manufacturer of personal hygiene products and dropped almost 6% when trading was halted at its request on wednesday. have a look at that. as we head into the lunch break, other things we are following this thursday. going to be very busy, to say the least. rishaad: particularly in europe. david: how many in europe do we have here? forgot about this. markets doing well, much better than at the start of the session. as you can see, a 50 futures in ch

bloomberg has learned that officials are exploring ways for the country's biggest lender to merge with commerzbank. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am courtney donohoe. this is bloomberg. vonnie: courtney, thank you. breaking news -- the sentencing hearing for michael cohen, president trump's former fixer and former lawyer, is underway in a new york court. cohen's lawyer is actually speaking now, trying to talk about cohen's life of good works and tried to get the judge to consider some of what cohen has been going to come in cutting what his lawyer called a barrage of attacks from the president. thoughtsays that cohen trump would shut down the mueller probe. the guideline is between 51 and 63 months. this is after cohen pleaded guilty to 8 charges including five counts of tax evasion and one of lying to a bank and two campaign-finance violations. telescope that -- it all goes back to payments to stormy ougal andnd karen mcd other matters in a related with the special counsel investigation

. >>> commerzbank will see changes to its board of managing directors. michael reuter will leave in 2019 and the chief operating officer will depart in february. >>> if you're looking for steinhoff's results for 2017 and 2018 don't be expecting them soon they will not be released until april. the forensic investigation into the company has been delayed last year the group admitted to accounting irregularities. >> let's not forget that the ecb used to hold steinhoff bonds on their books. >>> uk gambling firms agreed to stop advertising during live sports and broadcasts. there's been intense political pressure about the quantity of betting adverts that have appeared on british television >>> ds smith has reported a 32% jump in first half operating profit this was in line with bullish forecasts. the packaging company said that growth in e-commerce helped to offset higher production costs the results showed it held on to a strong position in the sustainable packaging settlement >>> switching to tech. facebook's board of directors says coo sheryl sandberg was

assets, mainly being translated in the banking sector because of this carige story >> ten years on, commerzbankays the world is suffering from the fallout of the 2008 financial crisis the bank also says that tech no lo tech te technological changes are hurting banks. >> i think there's a disconnect between what politicians with deliver and what voters wanted that's one of the first problems the second problem is within the economies themselves if you look across the whole of the world there are disconnections between what's happening in the united states, europe lagging behind, the chinese economy is still slowing, and there is markets where i think valuations look crazy to me as an economist. >> are they crazy? i look at forward valuations for the s&p and the ftse neil cited the ftse yields, if you take out vodafonevodafone, s flattish >> you still have lloyds to tal about. >> i mean are they that extreme? >> i tend to look at this ten-year trailing index that robert shiller popularized it is the third highest level in history. the second highest level in history -- >> in the u.s. >> in the u.

like a face-saving merger with commerzbank. they have a shareholder selling now.on companies -- >> they buy into everything and dump everything. >> was crazy to let them come in and buy it in the first place. they were not a credible buyer the germans were so happy to see them show up they said fine. now they're selling. all those positions are levered. you need a new anchor tenant in deutsche bank that is willing to sign on to a new strategy. we don't know what that strategy is yet >> maybe that tenant could be citi group we'll see. big story. amazing how it doesn't get as much play. >> one morning it could. >> one morning it likely will. thank you very much. >>> taking a breather. stocks slumping after a rally. jeff kleintop has what you need to know for next year. >>> and three tech giants fighting to become the most valuable company in the world. th iyoiss ur rbi so they say that ai will put the future in the palm of our hands. that's great. but right now you've got your hands full with your global supply chain. okay, france wants 50,000 front fenders by frida

the losers, commerzbank and deutsche bank, the estimate -- the m&a interest dissipated.et against something happening this year. something like metro bank in the u.k.. french are another area that have underperformed considerably. we have obviously got this good news in regards to the italian budget. you have created this. this is about italian banks. they have been making progress. have they been rewarded on the equity side or the debt side? is it reflected yet? >> not fully, no. the problem with the italian banks is you have got another 600 billion to clean up. the revenue side is pretty ugly. fees and commissions is a bit of a horror show. they are still too high for 2019. 2020 as well. manus: if i said to you, look, the revenue -- the revenue forecast being cut across the board through 2018 and into 2019. how bad is it going to be next year? is it a reality risk? >> i think we're going to have less cuts. the consensus is a little bit too high. we have been waiting for rate hikes. setrate hike has not through the margins the way people would have thought. because of c

continue to argue many voters are beginning to ask if isn't expensive miscalculation peter dixon from commerzbank has more i think when you look back to three years ago those people who pushed for bread state i don't think i expected to win and they could never had a plan to deliver in the event that they did so now we've wasted an awful lot of time and effort since the referendum trying to figure out how to deliver bragg's it which it's not even clear that the electorate now wants so it has indeed been very expensive both in terms of absorbing government time. to the energy which businesses now have to spend in order to prepare for something which frankly may not even yet happen g.d.p. is about two percentage points below. where it would otherwise have been in the absence of bragg's it and that can be calculated in in a number of ways when that's a bit like saying you know we've almost lost a year's growth. over the two year period which is you know quite a quite a considerable quite a considerable sum. so without putting a precise figure on it i think it's fair to say the numbers being well i t

hit household spending joining me now from london is peter dixon peter is a senior economist with commerzbank good to have you with us so peter to what extent has been an expensive miscalculation so far what do economists say. i think that's a very good way of putting it really i mean i think when you look back to three years ago those people who pushed for bread cheat i don't think expected to win and they could never had a plan to deliver in the event that they did so now we've wasted an awful lot of time and effort since the referendum trying to figure out how to deliver bragg's it which it's not even clear that the electorate now wants so it has indeed been very expensive both in terms of absorbing government time. the energy which businesses now have to spend in order to prepare for something which frankly may not even yet happen how expensive or how much does it cost the u.k. economy do we can we put a number on it broadly speaking g.d.p. is about two percentage points below. where it would otherwise have been in the absence of bragg's and that can be calculated in in a number of ways i

still with us, peter dixon of commerzbank and kallum pickering.s anger may not be diffused unless you have a populist government. kallum: that is the worry. is a little more safe because he is a president with a party. structural reforms are necessary. they will bring down unemployment but they are a slow burn. they cause insecurity and uncertainty for workers affected. the way to defuse this and finance it is fiscal stimulus, a transfer so they know they are benefiting and overtime time, the lower unemployment will finance that spending benefit. francine: where do you see value in europe given the populists? peter: if you're talking equities, it is hard to find it. --many is the least works least worst option if you're looking for value. investors are looking at asset classes and struggling to find value. i think investors are under waiting your. they look at -- under weighting europe. tom: if we have a japan slowing dramatically. peter, if we are having a slowing economy off trade war, how does europe shift? does it have a real impact? will have

nejra: peter dixon of commerzbank with us.tom: good morning. bloomberg surveillance from new york and london. nejra cehic in for francine lacqua. i'm tom keene. a mixed tape right now, the market looking for a bid, the equity market a bit better. with our first word news, here is viviana. viviana: there is one less general and president trump's cabinet. the endis retiring at of february, noting differences with president trump over the direction of u.s. foreign-policy. the president tweeted a successor would be named soon. the decision to pull troops out of syria is seen as a rebuke to the general. he had argued their missing -- mission was not over. >> everything that indicate strength, knowledge, is leaving this administration. general calle, general mattis, so many others. kelly, general mattis, so many others. there is chaos. this week was one of the most chaotic we have seen in government. viviana: the u.s. plans to cut troop levels in afghanistan, coming just one day after president trump said he would pull forces from s