the big move in financials not driven by commerzbank, commerzbank is trading higher by 0.6%.fteresting to see 2.7%, i mentioned the gains companies, and that is one of the european games companies. -- gains companies. let's move to the downside and look at what is weighing on markets this morning. vesta. numbers out of that stock down by 3.9%. deutsche lufthansa is of interest. -- that ise new flow ex dividend as well. matt: european markets opening ,lightly lower, not a huge drop nothing like what we saw in the u.s. overnight. threats of higher tariffs reverberating through local markets. investors are trying to separate negotiation tactics from policies. we spoke to a former adviser to the people's bank of china and got his take. >> president trump appears to be crazy, i will call him crazy.lly he wants to squeeze a deal and appear to be tough in front of american political stakeholders. at the end of the day, he wants a deal. matt: joining us now is shweta singh, managing director global macro & eu economics, ts lombard . what do you think about donald trump's move, the u.

commerzbank has posted a 54% fall in first quarter net profits on higher taxes. we caught up with the -- following the elgtsian bank agency earnings release posting a 16% drop in net profits. now, he told cnbc in an exclusive interview that the success of european banks hinges mainly on their business models. >> it is clear that if you are concentrated on a business model that is relying on what management protection on commissions on ability to leverage on wealth, it is much better than having a business model relying on corporate investment banking on level two, level three access, and the case of -- is a typical case of well diversified company concentrated in a country, but leveraging on the parts of the country family's wealth, the related companies. we are in a unique position also compared with the german companies or other players in the market >> what are the differences, though, on npr we are looking at commerzbank today. barely to think about 1% mark roughly. if you look at yours, your gross npr ratio at -- you sort of get the impression once you share

commerzbank ceo martin zilca has taken the agm.some of the flashes we're getting from that agm of course, this comes on the heels of the merger talks with deutsche bank breaking down a couple of weeks ago, but he is saying the ceo is saying that the talk breakdown did reveal some areas where commerzbank could tweak strategy they said that they plan to reveal more on their strategy in autumn and that the results did not yet fully meet their expectations, but they are going to be working very hard on increasing profitability at the bank of course, as he wn, there are many other banks circling around commerzbank as a potential takeover target. the next couple of months will be crucial for the direction of commerzbank. we will be hearing updated strategy project eks and offer this year. >> starting with corporate news, marks and spencer shares are lower as the company separates third straight yearly decline after full year adjusted pretax profit fell 10%. ceo steve rose says the british retailer is making good progress as it continues

what is the sweat level for commerzbank now?und of job cuts would be the question. ed continues to flatline, rates are not going up, and as credit nots begin to rise, that offset the savings they deliver next year. what is your next trick? has to be costs. everybody else is doing costs as well, but there is the relationship with government. what is the tangible difference between commerzbank's discussions with german regulators versus deutsche bank's? jonathan: deutsche bank is three times as high. it has pretty underlined lossmaking. they are a proper restructuring story, they need to shrink the u.s., shrink spain, shrink germany. francine: thank you so much, jonathan tyce stays with us. let's head to frankfurt to talk about german banking. live with the chief executive officer of commerzbank. i am here with the finance chief of commerzbank. he had better than anticipated earnings. revenue was in line with what the street anticipated, but you still have an issue with declining topline numbers. how will you boost that? stephan:

the cfo of commerzbank. we didn't build the nation's largest gig-speed network just to make businesses run faster. we built it to help them go beyond. because beyond risk... welcome to the neighborhood, guys. there is reward. ♪ ♪ beyond work and life... who else could he be? there is the moment. beyond technology... there is human ingenuity. ♪ ♪ every day, comcast business is helping businesses go beyond the expected, to do the extraordinary. take your business beyond. to bloomberg to markets. we are they from the city of london. i am anna edwards alongside matt miller who is in frankfurt. matt: the markets say which way is asian equities going to follow wall street into the abyss as donald trump's terror of threat is felt in markets. europe and u.s. futures are not showing as much as far as direction. the cash trade started 30 trade started 30 minutes time. -- starts in 30 minutes' time. ♪

for thisthe options business since failed talks with commerzbank -- the failed talks with commerzbank was the latest strategy, this possible merger. this morning, we heard from the cfo, signaling that they still have a lot of revenue concerns ahead of them. back and possibly mean they are not going to meet targets. i will send it back to you does it is very loud behind me. i'm going into the agm in 20 minutes and we will be back with more details. anna: we look forward to those updates as anne-marie -- annmarie contends with the noise. ben jones state street is still with us on set. let's pick up the conversation where we left. looking at the sector as a whole , no matter what strategic choices any of these banks make, they still face a number of headwinds. us, the banking sector has been the sector to avoid for quite some time. factorsthe main driving behind whether european banks perform or don't, and whether european equities perform, has whether the yield curve steepen's or not. we have had a little bit of a pop and performance in european banks. and really did not last very long

let's talk about whether or not -- commerzbank. let's talk about if we get consolidation in europe, who will be the consolidators, and our shareholders going to benefit if we do get consolidation in europe? >> that is a long one. clarification in europe is going to be difficult without clarification -- to [indiscernible] especially [indiscernible] after that, it is clear that as bnp, head of retail, was mentioning, the environment is a killer for profitability of the retail activities in europe, especially in germany. billy way too upset that is to look for scale, so i would say that we need growth, but how are we going to achieve it? without clarification coming from the ecb and global regulator, it is going to be quite complex. guy: you pick up the issue of negative rates. who are going to be the consolidators? who are going to be the company's consolidating if we get this, the european banking sector? is it bnp, unicredit? who is going to lead the move? thembelieve that all of are looking at what is going on for the time being.

he would not answer whether he was talking to commerzbank.d be a shocking red headline if he did. shell, you are looking at 6%. when he's percent gear. we have all the editors taking you through the shell numbers. at and anna edwards take you through daybreak. the european market open is up next. it is a beautiful day in berlin. ♪ anna: welcome to "bloomberg markets: the european open." we are live from london. i am anna edwards alongside matt miller in berlin. matt: today, markets say no bias. the dollar gains after less dovish than expected comments from jay powell. european futures, struggling for direction with the cash trade less than 30 minutes away. anna: show's stellar results.

is said to be lining up an advisor to explore a takeover of commerzbank. we are also awaiting first quarter gdp for europe's biggest economy. ♪ manus: good morning from dubai. credit aggregate numbers crossing the tape, a red headline. first-quarter net income. the markets have penciled in 800 million euros for the banks, subnet income falls by 11%. capital market numbers beat. of course, you saw the fixed income commodities all rising on average by about 5%. so when we look at the various pieces of this business, capital markets revenue is a beat. sorry, relative to last year, it is up. they -- therein lies the point. nejra, you have got a little bit. nejra: i do. let me recap the numbers. incomeuarter operating comes in at 2.0 8 billion euros, the estimate 2.13, so a bit of a mess. beat estimates. first-quarter profit misses. up, we speak to the chief financial officer of abn amro. don't miss that interview. manus: certainly going to be interesting. let's talk about markets. the s&p 500, are you fully hedged? 34% of bank of america merrill lynch surveyed

or if credit is interested in taking over commerzbank or someone else i guess here the onus will bement to actually provide some more information and, clearly, thursday will be deutsche bank's big grueling day for the board and also for the head of the supervisory board. for all these years, all these strategy shifts, all these lower and lower share price developments i guess there will be a lot of pressure on our side for thursday's atm at deutsche bank. sources are telling me that deutsche bank still is expecting him to get it from shareholders, but at a very low level they are expecting some 60% of shareholders to vote in favor, which would be a very poor result at the same time the management board is clearly under very much pressure to show that they also can boost revenues, not only cost cut costs clearly, that's a key problem for deutsche bank. also, the question whether u.s. investment banking does not need a substantial shrinking will be a crucial topic at the agm on thursday that's back to you >> thank you very much worth just noting. >> one of the bis divers of all time -

commerzbank's team head of automated joins us in the studio.s is a stay of execution at the moment. can i invest in european autos with this hanging over my head? guest: i think it certainly makes it difficult. last year you had a situation where you really knew what the tariff hit was because you had this rate being imposed, but this time around we don't really have the formal announcement of any tariffs yet. we just got the risk of tariffs. these stocks are trading as we evaluate and change our evaluation. guy: how the gay discount do you think there is at the moment? demian: these moves seem to be reasonably fairly priced. i think that the thing with the european situation, we might have the u.s. imposing tariffs on these cars coming from europe to the u.s., seems to be pushed down the road for another 12 months. but you haven't cleared the probability of it forever. you've just deferred it. on the other hand, the china tariff situation has probably gone up because although no iniffs have been announced china, specific to autos, we are now s

up next, commerzbank in the crosshairs. advisors to explore a possible takeover, as we get earnings from abn amro. . lot of bank news coming up we also encourage you to tune into bloomberg radio whenever you are driving to work or in the office. check it out on dab digital radio in the london area. this is bloomberg. ♪ anna: welcome back to the european open. 14 minutes until cash trading. futures are pointing higher. we are expecting to follow the lead set like asia, particularly china shaking off weakness in the data. u.s. futures also pointing 0.4%. by 0.2% to this will be a key sector today, commerzbank's potentials buyers are doing their homework. ing is lining up advisors to explore a takeover. now followed by virgin earnings amro.ther vendors, abn credible investor? >> they are credible. , also business in poland. to make that deal work, you needed to come through. ing is one of the biggest positions in germany and able to get the savings, they are potential candidates. should we expect more deals to follow? philip:

daniel morris, chief market strategi strategist >> the hunt for commerzbank continues.hares move higher after a report about a potential new buyer or boyars. stay with us my mom washes the dishes... ...before she puts them in the dishwasher. so what does the dishwasher do? cascade platinum does the work for you, prewashing and removing stuck-on foods, the first time. wow, that's clean! cascade platinum. >>> welcome back to "street signs. these are your headlines >> a short-lived rebound european equity markets give up early gains despite a recovery in the u.s. and asia after president trump moves to diffuse trade tensions with china. >> we are having a little squabble with china because we've been treated unfairly for many, many decades >> germany returns to growth in the first quarter thanks to stronger household spend and the construction boom, but berlin warns a loonling trade war means the economy is not yet out of the woods. >> bell weather earnings two of the biggest tech names are set to report in the next few hours providing crucial ip sight on the world's secon

one bank is doing relatively well in frankfurt, that is commerzbank.euters report that says unicredit has decided to look at that takeover of commerzbank. unicredit is trading softer. commerzbank up around 4%. the car stocks are in focus. vw is having a solid day. the cac 40 trading higher. it is the china story feeding through the luxury stocks. kerry is having a good day. lvmh is having a good day. lvmh is the biggest point gainer for the cac 40 today. airbus is having a solid day. let me show you what is happening from the breakdown of the grr, what is happening from a sector point of view. every single sector is in positive it -- positive territory. technology, europe does not have much technology. the mining sector is doing well. financial doing well. industrials doing well. oil and gas doing well. only one sector negative territory and that is real estate, only down .2%. let's look at the individual names. i have not been able to capture all of them in europe. the banks are in focus. lvmh is trading up 3.26%. that is what is buying the cac 40. an

michael krause berg are a blackrock and peter dixon of commerzbank.list and investor cofounder talking about scooters and why he wants to take on paris by scooter. that is 6:30 a.m. in new york. this is bloomberg. ♪ >> this is bloomberg surveillance. i am sebastian salek. elon musk's spacex has made a business of launching satellites. tonight he will launch his own satellite. thecompanies will take first steps towards a space-based consolation to serve broadband to underserved areas around the world. he is doing this along with fellow billionaire jeff bezos. losses narrowed in the first quarter. the shared workspace operator reduce losses by 2-iron $64 million. -- 264 million. we work is expected to go public this year. thecisco is out with a bullish cell. businesses are still spending on contributor network this by concerns of a global globe. cisco says the americas region contributed the most to growth. asia declined. that is the boom -- bloomberg business flash. >> let's turn to the shakeup in corporate germany. deutsche and others undergoing chang

this is what we've seen in the recent case of deutsche bank and commerzbank. a business case to do it. >> is the german government picking up the phone and asking you about commerzbank? >> the answer would be no. >> is there any banker in europe you could see any advantage with consolidation? no, but at the same time we are consolidating market shares, which is a different notion. we have good clients and are growing the business and activities in germany. that's the big difference. market shares and entities. you can measure your risk, you can assess it, you can lead the process. acquisition is more difficult, more risky, more challenging in the current environment. ♪ >> 10 years on from the crisis, the fundamental issue for european banks in my mind is two pieces. one is they still have balance sheets that are not ready to into play their role in driving economic growth. europe has still been hesitant for deep capital markets like we have in the u.s. so much of the risk ends up on the balance sheets of the banks. what we look for over there is, can we find i

this is what we have seen in the recent case of deutsche bank i'm commerzbank. it takes time, and you need a business case to do it. guy: if the german government picked up the phone and asked if you would be interested in commerzbank, the answer would presumably be no. jean: the answer would be no. guy: is there any bank around europe you could see any advantage with consolidating? jean: we are consolidating market shares, which is a different notion. you have the consolidation of entities, banks. we are very happy growing to businesses in germany. that is the big difference. market shares and entities. you can grow the market share. you can measure your risk. you can assess it. you can lead the process. acquisition is more difficult, more risky in the current environment. in that case, i would say no. we have shareholders that would say no. guy: in one case, mario draghi and his colleagues at the ecb, when they talk about this need for consolidation, what you are saying is they have created the environment for it not to happen. the flat curve is effectively pr

peter dixon of commerzbank with us.d lyft done for the appetite of the next unicorn deal? mark: there is two ways to look at this. from a private markets perspective, they have given everyone a sense we can build with great capital, great companies. they waited too long to take their companies public and as a result, you see what happened with the share price. it is below their ipo price. tom: what is so important, and this goes back to your background with arthur andersen, that tech gets to play by a set of different rules. they do the extrapolate of policy -- process of fund -- funding and then they throw out an equity offering. is that game about done? mark: i hope it is because i think the pendulum has swung too far. when we were taking companies public, we were taking them to lower valuation and allowing the public markets. we changed that as we started funding these unicorns and delaying the ipo's. hopefully, the pendulum will swing closer to the center where ultimately both sides of this equation can make money.

tom: why does unicredit shareholders not want them to buy commerzbank?cution risk that remains quite substantial for a banking deal. also a lot of opposition in germany, not just to deals but to foreign deals as well. the labor union said there would be blood before they would sell to an italian bank. another thing unicredit could be doing for itself is engaging in potentially a risky combination. tom: do you see any indication of a desire or appetite of cross-border mergers? i do not see it. elisa: on the one hand, the european regulators particularly the ecb would like consolidation to take place. on the other hand, it does not see from a regulatory standpoint that that is possible because without a deeper banking union cana deposit scheme, you move liquidity around freely and it makes deals more attractive. tom: elisa martinuzzi with us today, writing important pieces for bloomberg. what has your important attention of the 14 stories in europe? francine: tencent, i know who broke it at the beginning of the hour, tencent topping estimates but investors

this is what we've seen in the recent case of deutsche bank and commerzbank. time, and you need a business case to do it. >> ok, so if the german government picked up the phone and called you and said, are you interested in commerzbank? the answer presumably would be no. >> the answer would be no. >> is there any banker in europe you could see any advantage with consolidation? >> i say no, but at the same time we are consolidating market shares, which is a different notion. you have the consolidation of entities, banks, but it grows in germany. we have good clients and are happy growing the business and activities in germany. that's the big difference. market shares and entities. you can grow the market share, you know what to do, you can measure your risk, you can assess it, you can lead the process. acquisition is more difficult, more risky, more challenging in the current environment. >> 10 years on from the crisis, the fundamental issue for european banks, in my mind, is really two pieces. one is they still have balance sheets that are not ready to start l

one of the questions is how do you take commerzbank and make money out of it without laying off peoplene of the big hurdles to getting a deal done. there's been a lot of pushback from workers and unions saying we don't want to merge because we don't want jobs laid off, but in terms of these companies, potentially it could expand their presence in germany, and i could be really helpful long-term in terms of their client base. unicredit doesn't have that kind of retail presence in germany, celeste synergy in that way. david: it is very different from , where they have branches, but they are in for an parts of the country. alix: i see. peggy: and maybe there wouldn't be amu overlap in terms of layoffs, so that might make it possible. alix: let's go to deutsche bank and some raids for individuals that happened last november. deutsche bank offices were rated because they were looking into ere -- offices because they were looking into possible money laundering. peggy: one of the things that dates back to the panama papers is the synergy between global tax authorities. the u.s. has been crack

this one was -- this was one where the commerzbank acquisition unraveled this year. about 40% in the past year. profitability has been an issue. shareholders have been losing patience and today, a day of reckoning in a way for the ceo to signal what's ahead and what shareholders can expect going forward in this journey which has been grim. francine: the bottom line is he is cutting cost in the investment bank. he has done that in the past. people know that is a problem. what does he want to be? therein lies-- >> the dilemma for some of these ceos for european banks. deutsche bank is emblematic of all of these issues that are facing european banks. in the case of deutsche bank, the problem is twofold. unitave investment banking that has been holding back profitability for a long time. they cut -- if they cut -- if they cutback too much, they lose their significance and their ability to compete with their u.s. rivals is further eroded. it is a balancing act for sewing. the first line of business for him is to jettison units that have been unprofitable. ?rancine: will t

commerzbank shares are falling by nearly 3%.s that, even with negative rates, bank needs to pay some interest to depositors. is will they continue to see even further profit margins squeezed more than they already have? matt: thanks. we are seeing already arrows are we are down 1% or more, at least as continental indexes are concerned. a very risk off day. shares are getting a boost following the first earnings report. they reported first-quarter sales that beat estimates, but it also lost $1 billion, a much the largest of any company. ceon earnings call, the said that maintaining an advantage over rivals comes with a cost. >> our platform model allows us to require and engage customers with it a cost efficiency and effectiveness advantage over rivals, typically monoline competitors. these are just getting started as we penetrate into a $12 trillion market. is a seniorg us now technology and media analyst for bloomberg. welcome, thanks for joining us. how were the results? >> they were pretty good. they had given a range of esti

commerzbank holding its agm followed by deutsche bank.ajor -- merger p later on in the week, voting gets underway in the elections for the european parliament. the u.k. and the netherlands go to the polls thursday. i like a mega wall. it means it is really important and you should not miss it. tom: and no "game of thrones" spoilers either. and i want to bring this up as one of the great tensions -- this is deutsche bank, down 1.37% over the last five days. that is an ugly chart. and wolfangoons piccoli, as we stagger towards thursday and the european elections -- i guess it is that american phrase, "lame-duck," the idea of british situations or party members to brussels, to the european parliament. how lame-duck are the british when they go to brussels? wolfango: they are and have been for some time. one of the first turning points was david cameron taking his ., stillt of the a.p.p the most influential powerhouse in brussels. so certainly lame-duck now and more in the future. regardless if these elected mp.p's will manage to take the oat

either by a merger deep or cost cuts or as some point point out investment bank operations the commerzbank negotiations collapse a few names it could make sense that to pursue a merger we need to keep in mind that deutsche bank is already too big to fail entity with systemic risk also the reason reputed asian no problem related to some of situations and ask for now it seems that their plan is to achieve a cost cutting targets and take some measures to protect a downgrade of its credit rating or it was a lose tomorrow keeping an eye on things in the u.s. thank you jose and staying in the u.s. automaker ford is cutting some $7000.00 white collar jobs roughly 10 percent of its global workforce the move is part of a major restructuring that the company says will save $600000000.00 annually and streamline its operations about of a 3rd of the layoffs will will be in the u.s. forces also cutting jobs across europe as part of a separate plan to turn around its business there including $5000.00 positions in germany. and let's look at some of the other business stories making news. the chairman of t

he is joining us life at commerzbank. >> moving to central banks, my favorite, the rba has left rates unchanged despite a series of weak data readings for the auts raelian economy. retail sales came in at their worst level in seven years, and first quarter inflation was 0%. >> they're playing wolfer hatchton >> u.s. president donald trump, he is awarded tiger woods the presidential metal e medal of freedom. that is, of course, the highest civilian honor in the united states. it's a happy story i think we can agree >> all right the owner of maximum security, the first ever horse to be disqualified at the condition ken derby, has lost his appeal to overturn the decision the kentucky horseracing commission said it made the decision after a thorough review of the race, but owner gary west has promised to fight a lawsuit in due course. he has also his race horse out of the upcoming preakness competition. the plot thickens. also coming up on the show, talks between the u.k.'s major parties resume today to break the brexit impasse we'll get the view of the former trade minister that is lortd

our roundup starts with commerzbank. commerzbank net estimates.stomers, better results for net interest income. the numbers should give a boost after the breakdown of merger talks with deutsche bank. difficult,ronment is as it has been for the last five years. expect forward, we don't it to get easier. >> you have negative rates to contend with. how long does that happen? is this a permanent situation? >> it has turned from a nightmare to just reality. what was said about rates going up and down for the upcoming years, i think there is little to no believe that we will see rates rising in the next two years at least. >> walt disney rose in late trade after earnings beat estimates. profits fell 13% in the second quarter. analysts were expecting a deeper drop after the move into digital streaming. what truth a good result? >> theme parks did well. espnable tv business with also did pretty well, better than expected. disneys always been what has been able to pull off. it has these diversified businesses. if one thing is not doing well, another picks

been shattered after the talks failure between a budget talks failure between dutch a bank and commerzbank to things have changed this time around and also that this could perhaps be the next best thing to a german champion because you needed it also owns high bank now that's a german lender with predominately branches in southern part of germany bavaria and body in which emberg they'll be far less overlap of branches as far as branches a concern because commerce where branches are all across germany and they'll be far less overlap but selling a deal that dies a german bank debt laden italy would be difficult in berlin a consolidation away sounds great to the investors what about the unions the unions the unions cut of the previous dealer that could have happened with such a bang this time around they're going to even pause a stiffer there's a stance that's because they don't want the german that german bank to actually be taken or by italian and italian banks it's about national pride and also the fact that they've indicated that they would be more amenable to a foreign bank buying a germ

in terms of deutsche bank's failed acquisition of commerzbank, what that has done has thrown open the conversation on european banking consolidation. the issue is it is not clear how that will happen, what type of regulatory bodies will need to get involved for these plans to be moving a long. indeed, what resistance we might see from like your letters -- from regulators. for now we are seeing the earnings results stream in. many the weakness in investment banks, a case for consolidation is strong. guy: let's talk about what has been going on inside investment banks. generally not great. today better. how to the mp outperforming the fixed space and is it sustainable? sree: that is the million-dollar question, whether it is sustainable. i would point out this is an outlier in terms of their previous results. the previous quarter, they had big equities trading. missteps, as well as some losses related to its commodities unit. they did decide to shrink their old prop trading units and this time we saw some of those one-off items taken away on the fixed income side. they were helped by ra

our roundup starts with results from german lender commerzbank. commerzbank has met estimates for revenue in the first three months. the german lender added 123,000 new retail customers, fueling better-than-expected results for net interest income. the numbers should give a boost to the chief executive after the breakdown of merger talks with deutsche bank. >> in general, the environment is difficult, as it has been for the last five years. looking forward, we don't expect it to get easier. >> you've got negative rates to contend with. that is a banker's nightmare. how long does that happen? is this a permanent situation? >> it has turned from a nightmare to just reality. if we examine a little bit what the ecb has said about rates going up or down, for the upcoming years, i think there is little to no belief that we will see rates rising in the next two years, at least. >> walt disney rose in late trade after earnings beat estimates. profits fell 13% in the second quarter, but analysts were expecting a deeper drop after disney's expensive move in

when you look at the situation in germany with deutsche and commerzbank, the banks have not yet cleaned balance sheets. that is the process we need to go through more than anything. the second piece that is a bit political is there is a reluctant to encourage the development of deep capital markets. so much of the loans ends up on the balance sheets of the banks so when there is a slowdown in the economy where there is a volkswagen, it immediately slows down. u.s. banks that are able to put much of that lending into the capital markets, they don't have that halt to their business when some the gets the market. alix: such a great point. thank you. are you going to ride the train again now? [laughter] alix: bob diamond is going to be sticking with us. amidg up, growing angst bochy bank ahead of its -- amid deutsche bank ahead of its annual meeting. this is bloomberg. ♪ ritika: this is "bloomberg daybreak." coming up later on "bloomberg markets," heyman capital management founder and cio. ♪ ritika: this is "bloomberg daybreak." ceothe first time, sony's has laid out his full longtime visio

our roundup starts with commerzbank. >> commerzbank has met estimates for revenue in the first threehe german lender added 123,000 new retail customers, fueling better-than-expected results for net interest income. the numbers should give a boost to the chief executive after the breakdown of merger talks with deutsche bank. >> in general, the environment is difficult, as it has been for the last five years. looking forward, we don't expect it to get easier. >> you've got negative rates to contend with. that is a bankers nightmare. -- banker's nightmare. how long does that happen? is this a permanent situation? >> it has turned from a nightmare to just reality. if we examine a little bit what the ecb has said about rates going up or down, for the upcoming years, i think there is little to no belief that we will see rates rising in the next two years, at least. >> walt disney rose in late trade after earnings beat estimates. profits fell 13% in the second quarter, but analysts were expecting a deeper drop after disney's expensive move into digital streaming. what drove the results? >>

a sharper strategy for commerzbank.e possibility of another deal after the collapse of merger talks with deutsche bank. and it is a little-known rule from geneva's private bank. bankers encouraged to stay in switzerland, discouraged from living in france to risk exposing sensitive data. i wish we had that problem. david: that you have to live in france? alix: whatever. david: we welcome now soon ali bassett -- we welcome now sonali basak. is this really out of the ordinary for barclays to let 12 people go at a time? sonali: not really. morgan stanley also cut a bunch of jobs in equities. also, the places that we have seen cuts, not so surprising. what it does ask is are there going to be more cuts ahead, especially in fixed income? david: and barclays particularly focused on the investment bank because that is the thing shareholders have been after jes staley on, and jes says we are going to keep it. sonali: this has been more of jes staley's problem after the exit of one of his longtime deputies. there is reshaping at

commerzbank's annual general meeting is going to get frisky in frankfurt.believed flirt with deutsche bank. a few ongoing issues. at 9:30 am we get the latest reading of inflation for the u.k. across -- the u.k. economy, expected stronger than last month. watch for continued uncertainty around brexit. later, the fomc announces -- releases its minutes. traders have increased bets the central bank will increase rates. watch for dovish clues from fed policymakers. as we look ahead to commerzbank's agm, here are the views of some of our guests on the story for european banks. >> i think eventually we are going to see consolidation. business. any be ruled, it cannot out per se. italian company could compete at the international level. >> you are hoping in the foreseeable future. conditions are set to see a real consolidation in europe. m&a is not some we find attractive. we really don't have any comments on any market rumors. it is really a question of sticking with our organic strategy. we look at transactions as they are presented. >> acquisition is more risky

manus: this deal with commerzbank fell apart thus far. what are the options post see bk? k?tential takeover merger fell apart. they are working on a plan b. he is an unapologetic cost cutter. fromeven cut things deutsche bank. what is next? many -- the big question is they want to be a big investment banker not? the chair has always wanted and dreamed for the bank to rival the main big u.s. wall street banks. many say they need to trimming the investment bank. it is a huge behemoth in terms of the bonuses it pays out. the fund is making -- it is not there. this is one of the things it will be talked about here. there are clouds of gas gloomy clouds surrounding deutsche bank. we heard from steve mnuchin. he will be looking into transactions for the bank following the new york times report about the bank dealing with president donald trump's businesses. today what is the next up forward? everyone will be looking to hear what their answers are about strategic planning definitely following that collapse of talks with commerzbank. there is no bound to your expertise. it is much m

what is so important is this point in 2013 in commerzbank.r again ever so slightly. how close are we to call options on the future? that there ceos are complete focused on equity price? elisa: the banks can carry on at these levels for quite some time. there is nothing triggering a restructuring, per se. it is clearly an indication of investor concern and the fact that there is no confidence these banks will be able to restore stronger profitability soon. to be fair, there is some concern, still, that are banks really safer than they were before the financial crisis? as time goes by, you could also see a somewhat re-rating of the industry. tom: is there any desire to merge? elisa: on paper, doll looks potentially great. in reality, the execution risk that jean pierre mustier mentioned is particularly significant in financial services. to theulators are going scrutinies before the signs of approval. down,eutsche bank is sitting on support, to the light. thank you for writing for bloomberg opinion. we continue with john normand. let me do a dat

commerzbank and global bank economist.oining us on this mayday. -- thank you for joining us on this mayday. what is your take on this u.s.-china relationship? will it completely unravel? hope not. if they walk away, we are in terrible trouble. it is part of a broader difficulty that china and the u.s. have. trade is a kind of symbol of difficulty rather than the central problem. the second-biggest economy is going -- growing rather quickly and a fundamentally different political system than that in the u.s. to 15 years ago, the u.s. you would be engaging with china that the political system will gradually morph into a liberal democracy. today, the u.s. recognizes that china was a threat to u.s. livelihood. just trump trying to up the anti-with china, it is the entirety of congress. so i think it has been great to have a trade deal but the trade deal in itself is not the only thing that guarantees we have a wonderful flourishing relationship with the two superpowers. francine: do you agree? >> absolutely. this is a much big

he wants tough cuts following the breakdown of takeover talks with commerzbank.: let's get you a sense of where we are fx wise. the dollar paring back strength. a line from bank of america merrill lynch, the yuan might if the talks at the g20 fail. in the absence of that or leading up to that, they expect the currency to trade on the stronger side. plenty more ahead. this is bloomberg. ♪ let's have a look at what is going on at cape canaveral air force base. spacex falcon nine rocket launch. the third attempt trying to get this. communications satellites into space. >> we are seeing this as a history making moment. it was delayed by a week or so. they weigh about 18.5 tons, more than any other payload that spacex has ever launched. according to elon musk. the previous high was 10.6 tons. definitely a heavy load. history in the making. >> 15 seconds to go before the rocket does live off. watch the drama as it unfolds. >> 59. >> that was lift off. spacex's six launch of the year. making its way back to earth. booster stage. stilllatform, called, i love you. 30,000

commerzbank at it more corporate and retail clients but revenue declined by almost 30%.n stanley dealer in paris may change banker pay in europe. the firmarotta says unfairly withheld deferred pay a year after he bought in more than $100 million in fees. the case raises the question as to whether new york law is the bottom line when it comes to how american bankers in europe are compensated. that is your bloomberg business flash. alix: thank you so much. what is interesting to me is that has big implications for the entire banking sector in terms of pay. david: i did not read the fine print and did not know i had to stay with the company to get the bonus. the more important question is what law applies. is it new york law, or french law, which is quite different in this regard. alix: 100%. you have to make the argument we're always talking about labor laws. how does that play out for the yellow vests. there is a deeper conversation to be had. david: my impression is french law is more favorable to employees than u.s. law. alix: a little bit. david: time for follow the le

we know about commerzbank. big of a surprise is that ubs and deutsche bank considered getting together and starting a cross-border merger? >> it is a surprise. there been rumors. there's been interest at deutsche bank. there was also a story about deutsche bank asset manager potentially tying up with ubs asset manager and the banks discuss this. that is the big surprise. however, this was only a very preliminary stage. it was abandoned. they only disgusted briefly and it did not happen. vonnie: why not? how many barriers were there to that happening was a regulation question, a price question, a valuation question? steven: i think it was all of the above. i am not sure what the deal breaker was. in european banking m&a's there are big regulatory hurdles. there's also the question for deutsche bank investors, do i want to merge with another bank. deutsche bank stock is trading at an all-time low. price-to-book ratio is extremely low for the bank. that is another thing. the leadership issue, all of those question

doingtch bank ing is nothing to dispel speculation it may be interested in germany's commerzbank.omberg speaking with ing's cfo. >> we really don't have any comments on any market rumors. i think it is really a question of sticking with our organic strategy, but of course we will look at transactions that are presented to us. viviana: talks with deutsche broke down last month. that is your bloomberg business flash. alix: thank you so much. commerzbank remaining an m&a target after talks fell through with deutsche bank, and now ing credit is eyeing them for a deal. how closely do you follow what happened to deutsche bank as a proxy for the european banking sector? benjamin: not so closely, to be honest. when we think about europe and european equities, the banking sector is a very important part of it. let me take one step back to say that european fundamentals more broadly, so the banking sector as a mechanism for credit growth, is a part of it, but european growth more generally has been one of the puzzles that started last year that i don't think is fully resolved here. we've be

on deutscherounding bank for having no plan b after the collapse of potential merger talks with commerzbanks for march fell for ninth straight quarter and shares are worth less than half their value five years ago. ontsche's says it is focused cost cutting but citigroup is calling for a more radical restructuring, including a potential exit from the u.s. market. facing an investor revolt with shareholders refusing to back management over the thanks handling of events that led to a $5 billion fine for helping french clients evade taxes. routine vote a that failed to reach support. they reserve the right to take legal action against the management. almost one million people from states eastern odisha moved to temporary shelters as the region braces for its worst tropical storm since 2014. making itself fan felt already as we speak. winds as high as 200 kilometers per mile -- per hour. omg see has taken precautionary measures. rishaad: let's get the latest on this from our oil trading reporter. what is the latest and what is the news on the ground? what we get to hear from the cyclonic storm i