mario good draghi -- mario draghi's news conference on deck. "bloomberg daybreak" on this wednesday, april 10. we've already heard from the ecb. they are not changing anything. that puts the pressure on the news conference. alix: did we expect anything from tltro's? there is optimism that the ecb will come in and help profitability for these banks. david: and you know at the press conference they will be asking him. i entered in the beginning of the press conference." we can do a drinking game on how many times he says that. in the markets, it was kind of a risk on as we head into the fed minutes as well. the s&p snapping an eight day winning streak yesterday, but now up. the euro holding onto its own, up by 1/10 of 1%. oil, opec said venezuelan output fell to 730,000 barrels a is falling onrket supply, not demand. what that could mean could be really interesting. david: it could be a quick turnaround. alix: something we are looking oo, -- david: because we have no ammunition left from the central banks, it could last a lot longer time. in the

a dovish draghi warns the slowdown could worsen. we will get the view, live from washington later today. wall street on capitol hill. u.s. bank chiefs are grilled on everything. first-quarter results hurt -- hit tomorrow. ♪ good morning. welcome to daybreak. color, please hold until the end of october. we are in suspended animation on the pound. we are frozen in time because nothing has been decided upon apart from extension period look at volatility on the pound. down it has gone for eight days in a row. this is the lowest we have seen. since last year. all ethics volatility is repressed -- f x volatility is repressed. are we closer to hard brexit? are we closer to an election? all pre-mutations are on the table. let's look at the risk of -- risk on the radar. between the stock inventories in the united states versus opec's commitment to cut which is very much along the line of our guest from yesterday. compliance its 155%. copper is down. would you believe more? how much of a slowdown is their relative to draghi's my dark -- remar

>> current to the eb for hibts from mario draghi on how the central bank is dealing with a slowdown in the german economy >> e.u. leaders are poised to offer a second brexit extension, but france wants strict conditions as european council president donald tusk calls for a long, flexibility delay. meanwhile, german finance minister tells cnbc his country is ready for any brexit end result >> we are well prepared for both >>> tesco rises after reporting a better than expected full year profit and hiking its dividend, but the british grocer says market conditions remain uncertain. >>> and a u.s. indictment weighs on indivior. an illegal marketing scheme began before they spun off back in 2014. >>> well, good morning welcome to "street signs." european markets this morning trading higher despite a soft handover from wall street yesterday as well as another downgrade to those global growth forecasts from the imf investors today largely in wait and see mode it's a big day for monetary policy with the fed march meeting minutes coming out layer today, and before that we have the ecb meeting h

we had a gdp number that signals mario draghi could chill out.e waiting for details on tltro and what that will mean for the european banking sector. how closely tied are the fortunes of the european banks, european banking investors, and that story about what mario draghi or his successor will do? jim: you talk to any european banking executive, the one thing they talk about unanimously is how much they are being hurt and how much they have been hurt, how much of a competitive disadvantage it is to deal with the negative deposit rates at the ecb. until the european interest rate story changes in a significant way, bank shareholders here will be under pressure. guy: always great to get your reporting. bloombergs jim hertling. thank you for much. vonnie: let's check in on bloomberg first word news. here is kailey leinz. mark: of venezuela -- kailey: a venezuela political fight could perform -- could -- the future of the country. juan guaido has called for military uprising. he has the support of the u.s.. the regime promised to punish anyone who j

mario draghi adds to that story. he says he is increasingly worried about the fed's independence. steven mnuchin says the u.s. and china are closer to a deal, but he is also worrying about currency manipulation in japan. >> let's get you started with a look at the markets close in the u.s. brought optimism over the global economy because of positive data out of china. s&p 500 gaining for a third consecutive week. onancials leading the gains friday, positive earnings out of jp morgan. the only sector in the red was health care, insurers falling for a second consecutive session as we had congress debating drug costs. u.s. futures holding at 29.13. let's see the asian session. sophie: some of the optimism may be happening for asia. futures are narrowly higher and we are seeing the tone set in wellington. we enter a week that offers chinese gdp numbers and u.s.-japan trade talks in the wake of japan highlighting concerns over china's industrial policies when they held economic talks on sunday. also we get trade data in india as the r.b.i. governor warns the economy needs to grow faste

draghi. guy: mr. draghi stepping into interesting territory. was what we -- what we saw was not much happening in europe. the equity market absolutely flat. you are looking at a similar thing when it comes to fair values in the united states. elsewhere, watching the pound, recently flat. volatility has collapsed. volatility collapsing and -- in the pound story. and we're waiting for goldman and citi. dow on the bloomberg, the right now, to get back to toober and the collapse down december, what a recovery it has been. not to record highs, but we are beginning to see, through the weeks, a little index here, a little index there. bull a great, unloved market. --ht now, let's get started stephen gallo with us. with us,n schenker usually in new york. i want to get to the politics in a minute, but let's do a mop up of the imf and the idea of the move forward in the imf and other multilateral institutions. how multilateral can we be in the future, or is there a permanence to donald trump -- is there a permanence to donald trump's approach to trade? m

mario draghi saying they see further cooling for the area of growth and maybe more to come.il, not able to go above the five-month high. brent down nearly .5%. we are seeing a surge of supply in the u.s. and the pound is flat. deadline, october 31. ftse 100 futures, relatively flat across the board. and hugetures higher reporting numbers from lvmh. the market is opening in the city of london. let's look at how we are opening today. another big day for macro economic news as we heard from the fed yesterday, the ecb. you have the imf meeting in washington, d.c. today. speaking to a number of people that matter to the market globally, especially christine lagarde after the imf cut global growth this week, worst since the financial crisis. u.k. market, relatively flat but a bit of softness. germany, opening to the upside. france, nearly up .5 percentage point. let's look at the sector picture. a bit of a mixed picture. real estateancials, is all in red. greg's it dragging on this extension, there is a lot of anxiousness from buyers and sellers. keep an eye and u.k.'s case home s

what draghi is saying is buyer beware.tting at my desk at work thinking the independence is being undermined currently. erik: what do you need to see to advise investors to start raising cash, you know, shorting stock and allocating more aggressively? henry: i think we are moving into the next five years, we will do better with stress. that has been one of the worst access -- asset classes. as money leaves the system, albeit more slowly than we thought, that will create a situation where the water comes out of the swimming pool and the we'll see who doesn't have debating suit on. every cycle has this -- we will see who does not have they are bathing suit on. a free -- every cycle has this. you have seen that in energies, retail, and it went surprisingly if you saw it in software, health care, and industrials, but it will take a lot for that to unfold. erik: you have been to china recently and came back with some thoughts on the prospects for u.s.-china trade. what are they? henry: the near is more positive than what most f

. -- mariorio draghi us, draghi, probably the uncertainty hit europe a little bit harder. however, he does not see estimates of recession rising. that is important. he also says the first line of defense, he sees it weakening and then picking up in the second half, it will be targeting financing through banks and maybe another look at negative rates. things that they think mario draghi is alluding to. rishaad: looking at bonds here, of competition. what are they watching? pmi, and job reports, inflation, all important around the world. how is this going to play out? that is important for bond traders, but we look more broadly, talking about inflation and what it mean for people with china and the charts. chinese inflation, i think it is going to get more and more. three lines, and all of them are below 2%. the turquoise one, just at 1.8 percent. the yellow when is the ecb. they are at 1.4, and then japan and ifne point 7%, 1.8%, you're going to look at what is going to get bonds to rally, it is going to be these. the central bank cannot raise rates. that seems to be the en

we also had mario draghi voicing concern about the independence of the fed. in big a factor is this terms of the way the people view the dollar at this point? well, i think to the extent that this is confined in tweets or personal verbal exchanges behind closed doors and leakages natural through the press, i don't think it is going to be a big deal. but if the market starts sniffing there is the slightest probability of the fed independence being compromised, i think we are talking about a totally different ballgame. i think it is going to be outright dollar negative immediately, but over the medium-term, i have no idea where this is going to extend itself because we will collapse under central-bank independence. vonnie: talks will be taking place between japan and the u.s. , and obviously continuing ones between china and the u.s. will they have any impact on where the yen goes or the yuan? there has already been an effect on the yuan based on what has happened in the second half of 2018. i think it is quite clear the chinese authorities favored some after w

over to draghi, no room for complacency at the ecb as italy's economy falters and the imf cuts it level growth outlook to the lowest since 2009. we get fed minutes tonight. danger zone. the u.k. might be forced into a long brexit delay but could amend or macron impose a series of extra demands? we are live in brussels. ever could seek about $10 billion in what is expected to be one of the biggest initial share fails of all time. manus: good morning and i am live in abu dhabi, we are rolling and we have had conversations from asset management but the lineup continues through out the day. i am speaking exclusively to the carlyle group in just a few minutes. doing deals and getting a check from the region. a president ofom aston martin. how are they doing in aston martin land in the region? that is later this hour. 7:30 a.m., you do not want to miss our conversation. he is in splendid form, the ceo of the texas investment. ixis investment. and we will be speaking to aberdeen sort -- aberdeen ceo.rs's he knows a thing or two about navigating change. nara, good morning, a cracking day for th

decision ecb rate followed by mario draghi's news conference in frankfurt. thoughts, robert tipp is with me, alongside scott kimball, and krishna memani. robert, i know you are itching to get in on the european debate. what do you want to say? robert: in addition to the high yield, which i think is attractive, there are definitely opportunities there, as well as investment grade, high quality clo's. the contrarian play in europe continues to be sovereigns. they were beat up and people are missing that. at any given point in time, one country will be in the headlines. italy, for example, now. in the background, the greeks are getting a billion dollars released to them. they are 300-plus over. they have a long way to go. spain, portugal. it is a contrarian play but i don't think this is anywhere near over. jonathan: is there a belief that you think the periphery, which has been treading lately, will start trading like a sovereign again? robert: that's right, i see this is an ongoing trend. have to watch this and see that it plays out, that the improvement is n

rick rieder looking for a big move from ecb president mario draghi.ompanies weighted average cost of capital. the cost to get in europe is much lower. cost of equity is too expensive. i think the ecb will buy their equities. if i want to do, improve sentiment, look at the right part of the capital stock him and that is where the companies are having a tough time. jonathan: still with me to discuss is robert tipp, scott kimball, and krishna memani. krishna, your view on that suggestion? krishna: in this cycle you cannot rule out anything. having said that, if the ecb is buying stocks, we are basically at the end of the rope. that is what it would signal more than anything else. because everyone would have tried everything and basically even the germans are acquiescing to buying stocks at the central bank level. that would be something. jonathan: with someone to exposure to european markets, that would push you 2-d risk rather than risking? absolutely. that would signal to me that we are at the number world rather than things getting better. i think it

wehael: we have mario -- have mario draghi weighing in on the independence of the fed. michael: donald trump is trying to manage a lot of things. the president tweeting the stock market would be higher and the economy would be stronger, growth over 4%, if the fed had done their job correctly. we presume he means if they had not raised interest rates. the president tweets have drawn a lot of reaction from central bankers, not just in the u.s. but around the world. saturday said it is disturbing that the united states would be attacking its own central bank. he says, i am certainly worried about central bank independence in the most important jurisdiction in the world. extraordinary to hear that coming from another country's central banker, a region's central banker. the problem is people are concerned that if these tweets start to have impact on market psychology, even if the fed does not react, it could interfere with the transmission of monetary policy. the markets might not behave in the way the fed wants to. david: fed independence has not always been sacred. there w

romaine: i think part of it with draghi's tone.ee him take much more of a wait and see attitude. there is a sense that he does not want to do anything to ahead of whoever his successor is going to be. i think you see that reflected in the euro. it did not really react too much to what he said. i think some of the commentary we got during the press conference with regard to negative rates from banks, i think that had a more lasting impact on the market mindset. maybe that is not something they are trading on today, but it will have a huge impact over the next few months. vonnie: traders are certainly busy out there. conagra up more than 6%, better than forecast. romaine: they are still seeing a lot of demand with reports -- regards to people buying basic goods, midpriced goods. regard toen with consumer staples and even the consumer discretionary sector, there does tend to be a sweet spot where a lot companies buy conagra and take advantage of the current spending trend. vonnie: we definitely saw some upgrades and some downgrades. s

draghi's footsteps. it might coincide with a potential downturn of the u.s.d what we are seeing. risk ofhas higher recession, it would coincide with the first couple of months of the new ecb president. it would be interesting to see if there is more unconventional policy. think the new ecb president may well take control at a time when economic news is getting better. francine: better in terms of inflation? >> better in terms of growth. interesting is that it is predominantly driven by the rest of the world rather than by domestic weakness in europe. is the manufacturing sector where most of the intense pain is. butnumbers disappointed, they did rise for the first time in a long while. i think if the economic data is improving but it's only get through to the end of this year, that a morebe seen hawkish president takes over at a time when data is consistent with a slightly more hawkish approach, whoever is running the ecb. francine: is there danger of a new trade were between the eu and the u.s. or between the eu and china? >> there will be a ceremony at the

mario draghi is worried about the independence of the fed.cb chief ads central banking independence is very important and the credibility of monetary policy hinges on it. henrietta, head of investment grade credit for europe at wells fargo asset management, she is our guest host this morning. if we just go back to the trump tweet, it's fascinating. he called for more qe last week, but here we are. if it wasn't for the fed actions, we'd be 5000 points fire and the you -- higher and the u.s. would grow 4%. is that fictional or does that have any veracity at all? beenetta: well, trump has trying to stimulate the economy as much as he can. the first action was on the tax cuts, for instance. i think it's a continuation of that. he wants an easy monetary environment to favor growth. i think the issue is that's not just their mandate. they're looking a little further ahead than trump is. it's not just about stimulating now. it's about getting an environment where growth can be carried on over the long-term. yes, trump wants a quick win. nejra: and w

kathleen: mario draghi. he is head of the european and i am sure -- it is so different from what trump is doing but mario draghi, it does not happen very often. he pushed back. he said he is worried about central bank independence in quote, the most important jurisdiction in the world. maybe not surprised when someone is pushing against the central bank in turkey as president aragon has, -- president erdogan has. thingsook at one of the mario draghi said when he was speaking to reporters. in so many words, pushing back. he said if the central bank is not independent than people may well think monetary policy decisions follow political advice rather than objective assessment of the economic outlook. what is wrong with that? the last thing markets want to see is a central bank that is doing what an elected official wants. they want independent policy, what is best for inflation and growth, not best forgetting someone reelected. it was not the official topic but it was certainly being discussed a lot over the w

. >> draghi says he is worried about said independence. he has no intention of going up against fed independence. that has always been our view. we have opinions the president , has opinions about monetary policy. it is a free country. no reason why he should not. good story in the journal this weekend about the fed history and how there is nothing new about presidents having opinions. we have no intention of damaging federal reserve independence. none whatsoever. >> the perception, following up on blake's question, the perception is, the tax cuts benefited the corporations a lot more than it benefited average americans. mr. kudlow: average americans, blue-collar workers, take a look at the numbers. perceptions are lovely. i don't know what any of that means here. again, c.a. estimated this on an after-tax basis, the average american's weekly earnings and so forth up about $2300 per family household. that is a terrific gain because of lower taxes and stronger employment. you can't do better than that and that may grow over time. some early

i've been following mario draghi for many years. this is a very rare intervention. about the fed. interesting coming from him. we heard from christina lagarde. she said there is definitely concern at the imf meetings over the precedent this is setting for the independent bank going forward. switching gears to a sad story. the company fish are price has recalled 4.7 million rock and play sleepers after pediatricians warned fisher-price not to sell them, as they have connected them to 32 deaths. the returns will take 12 to 16 weeks but for many families, some are contemplating legal action here. >> that is incredibly sad to hear. >> awful. >> i want to talk about delta. they're making a change. they're going to have some pretty angry passengers. they want to reduce the seat declines on domestic flights. why? >> depending on how you think about it. if you're using a laptop, maybe it's a positive. they'll reduce the seat decline from four inches to two inches. for those of you who fly first class, i guess ayman -- >> so are you assuming that ayman flies first class and

when we listen to mario draghi talking about risks, they are external and internal risks.tensions with the u.s. external risk. our negotiating group, which is currently negotiating with u.s. authorities, and hopefully we will be able to avoid further escalation of trade tensions. i think chances are now better that we will be able to avoid a so-called no deal brexit, which will be quite damaging for the economy, especially for the u.k. economy. romaine: thank you so much for joining us today, valdis dombrovskis, the european commission vice president. february marked the 40th anniversary of the islamic one u.s.n in iran, but official said few beyond the economic elite celebrated it. ,> we are here with brian hook the special representative for iran and a senior policy advisor to secretary of state pompeo. thank you for being here. the administration designated iran's revolutionary guards corps a terrorist organization. tell me what precisely this decision means. my understanding is this is the first of its kind. ? mr. hook: this is the first time the united states has sanc

does it make it more obvious that the ecb has plenty of ammunition, back to the mario draghi whatever it takes phase? >> that's a good point. we are hearing from the ecb -- the sense is they will review it and they are trying to flag it as a potential instrument they would have. if theyld allow them had to cut rates even more to introduce that measure to allow them to mitigate the adverse effects. so far, we are not seeing that. they haven't discussed taking rates even lower. peter,ank you very much, joining us out of frankfurt. let's check the bloomberg first word news. >> the wealthiest companies and individuals and france among those who pledged to donate 452 million dollars to restore the notre dame cathedral after the devastating fire yesterday. the family of the gucci owner will donate $113 million. the family that controls another pledged $26 million. notre dame had been under renovation. north korea's kim jong-un getting ready for his first summit with vladimir putin. the two will meet next week. they are likely to discuss the nuclear disarmament talks between north korea and

frankfurt, rates caps on change in april meeting. >> mario draghi on the risks.ted toks remain the downside. on account of the persistence of uncertainty related to , the threat factors of protection is in emerging markets. boring meeting, boring news conference, the repeat of what ,e've had the last few months leaving the cards open and basically making us understand that he has some ideas. that is about reserves and details. >> benjamin netanyahu set for a fifth term as prime minister in israel. early results indicate the two parties won an equal number of seats, but with his right-wing allies, not know who clearer path for forming a coalition. >> last night was a good night for prime minister benjamin netanyahu. his party looks like it will end up tied with the top rival, his party actually gain seats compared to its current standing and its right-wing outlets had a good night and most of them across the threshold to enter the next parliament which was a key feeder, so that gives him a clear path to form another government coalition with his religious allies a

coming up, mario draghi winds down his term as ecb president.ins us next for what i'm watching. this is bloomberg. ♪ david: here's who i'm watching today, mario draghi. stepping down as ecb president come this fall, there's a piece on the bloomberg right now saying that it will be hard to fill his shoes. joining us is rick rieder, blackrock's cio of global fixed income. this piece says if you really look back at what he's done, the whatever it takes remarks that may be cap the union together, and how statesmanlike he's been, he's done quite a job. rick: i'm a big fan. i think he's been incredible. i think it is the hardest job in the world. you think about the demographic dynamic, the leverage dynamic. you've got 19 countries all going in different directions. i've got a chart that showed the temperature in the euro zone against the leverage of growth. you have this incredibly different dynamics. only one engine that is coordinated, and like you said, he's done a really good job of managing it, being innovative in terms of different ideas. prett

as president mario draghi today and i can give you two reasons for this breaks it and the upcoming election for the european union parliament at the end of may in the run of to this election and because of brics it officials at the moment are very keen not to say anything that might be backing you know the anti european union populist rightwing forces in the european union countries and you know breaks it off. all right and say we don't need another shaky member conrad let's return to our main story here the i.m.f. says it's a delicate moment for the world economy and the i.m.f. also says the major players like china or germany might need to take short term actions explain this morning to us. you know the international monetary fund once germany and china to be more prone to make more progress with policies germany for example has for a long time been criticised to be too focused on austerity on a very conservative way of dealing with government debt and government expenses the i.m.f. once germany to spend more on infrastructure and do more on domestic demand and we shouldn't forget it's th

appreciate it. >> he's been listening to draghi at that news conference.w we want you in the last meeting o f the new loans that'll go to the banks to the economy, those details will be announced in meetings he does say an ample degree of confirmation is necessary. slower growth have been confirmed since the last meeting. he expects the slower growth to continue in the coming years global head wins are weighing on euro growth. he's concerned of protectionism out there. it is tilted to the downside inflation, this is important for the europeans, single mandate, inflation is all that matters to them more stomach limulus is coming a bit of weakness in the your ro euro on this. we wonder how much into what extent the federal reserve follows. all right, steve liesman, keep us updated we'll get to jimbo, see if cramer has comments on this or the hearing or where we are ten years later. who should we put in for tim sloane maybe an oceanographer do you have a preference for that job, jim? i just think that we are in one of those moments where the democrats are in

. >> i would add that is not technically not what the fed's mandate is >>> ecb president mario draghipressed concern over the fed's independence he said this hinges on central bank autonomy. >> we have 19 governments we deal with and our independence is enshrined in our constitutional treaty, which is not the case with the other central banks in the world and it couldn't be different if you think because 19 countries to deal with, you either create something that's truly independent or people would view this as being subject to this country one day and another country another day. so i am not worried about that, but i am certainly worried about central bank independency in other countries, especially as in the most important jurisdiction in the world. >> i was at the press conference as well and asked draghi about the tradeoff between resuming asset purchases and cutting interest rates after the ecb said it was ready to use all available instruments at last week's meeting. >> clearly, the choice in different instruments would depend on different contingencies, so that is the -- we wil

draghi is off to iraq later in the week. should we be expecting anything significant to come out of this meeting or the big announcement was made before and this is similar to what was said at the ecb. >> i think they did enough last time to make this meeting fairly standard that said, there were still quite a few things to watch out for. there's no doubt the economy is continuing to weaken should mr. draghi start to think about other policy options i very much doubt that will be contained within the opening remarks from the president at the start of the press conference, but you could easily see a few questions from some of the members of the press who then key some interest in answering questions about the details of the teltrose, possible tiering and whether they might change their guidance there are a lot of things that they can look out for and any signs will be watched closely. >> coming back to germany in terms of the economic data one of the questions is how much structural or long term? do we have any insight to say

was the fed not dovish enough or mario draghi more dovish than expected?ghtly higher than yesterday on the euro-dollar today. from a retreating five-month high with u.s. stockpiles undermining the opec cut. we have the iea forecast coming under pressure. this is bloomberg. ♪ >> symbolic withdrawal. eu leaders except a second delay to brexit. the u.k. will take part in elections for europe's parliament. the fomc grappling with significant uncertainties while the ecb sees growing threat to the eurozone. moment,most delicate the imf taking a fragile the of global growth today. an assessment of risk with christine lagarde. good morning, everyone. this is bloomberg surveillance. d.c. ascine with tom in we get prepared to cover the world bank. a lot of this is looking at the outlook with folks on the central bank and what happens in the next 18 months. tom: it has been a big change, 10 years on from the crisis, 12 years on from the crisis. the theme to me today, we saw overnight. president trump very quietly going after europe on trade. the intertwining here. an

where they were last october now given all of the rest of that >> it makes more sense that mario draghi it may not make as much sense to investors past october at the end of october mario draghi will be replaced. we don't yet know the identity it may well be that we have an occupant in the president's chair who actually has a much more hawkish stance in terms of the fiscal stance, and, therefore, is less prone to take an active role in the btp market and then that will pass through to yields. investors need to start pricing it up. >> also, incidentally, italy have to formally release their budget for 2020. remember, that's where it all kicked off last year as well, and they've got a big issue with trying to find and plug a hole worth of financing because one of the leaders, the five-star movement, has said that they don't want to enact those hikes. they still have to find and plug the hole in financing somehow, and that all comes ahead in october. it's another thing to watch out for. >> i mean, to your open question to start this interview, is this something that they need to price up c

jonathan: your take from draghi? >> boring meeting. i can't find another word for it.ing news conference. a repeat of what we have had the last two months, acknowledging the downside risks, leaving the cards open, and making us understand he has some ideas, and it takes time to get the governing council around. that is about the reserves hearing. >> benjamin netanyahu looks set to secure a fifth term as prime inister in israel. this despite a bruising election campaign against his chief opponent benny gantz. with his right-wing allies, benjamin netanyahu has a clear path to forming a governing coalition. give us the key takeaways for a global audience on this vote? >> last night was a good night for prime minister benjamin netanyahu. while his party seems like it will end up tied with his top rival, his party actually gained seats compared to its current standing in parliament, and most importantly, his right-wing allies had a good night. most of them will cross the threshold to enter the next parliament, which was a key fear. that gives him a key path to forming anoth

we had the ecb meeting yesterday where mahero draghi reiterate the his dovish stance. we had the fed meeting minutes that really left investors in the same place around whether the next step is higher or lower for the fed. what's clear is that the majority of fed members think that rates should remain unchanged for the remainder of the year the big ethtoday here in europe is no doubt brexit last night we had the european council meeting yield an agreement between europe and theresa may to extend the brexit deadline from this friday, april 12th, to october 31st. ftse 100 trading down about 45 basis points this morning, but not quite the worst of the bunch. over in italy the ftse mib is the laying adviser down 71 basis points mixed picture between french and german stocks this morning let's take a look at the sectors. one sector in particular today worth mentioning luxury stocks. they're trading higher led by lvmh who delivered a very strong q1 update. pulling up the rest of the sector more broadly, though, travel and leisure, the best performer of the day by a wide marg

ecb president mario draghi emphasizing the balance of risk remains tilted to the downside. >> there is growth outlook remains tilted to the downside on account of the persistence of uncertainties related to geopolitical factors, the threat of protectionist, and vulnerabilities in emerging markets. jonathan: still with me is subadra rajappa, michael collins, and bob miller. subadra, the financial repression trade is back. subadra: this is a classic financial repression trade. if the ecb is going to keep monetary policy accommodative? we know they will be introducing in september. the trade, you want to be in the peripheries. you want to be in btps. we have seen spreads narrowed dramatically. end of last year, 300 basis points, now between 200 to 250. great debt, the lowest level it's been in over a decade. to me, it is basically a signal, the ecb being on hold is a signal to take on risk. jonathan: is that right, bob miller? big move on the periphery, do you expect it to stay lower? bob: i think they grind lower. i don't think the ecb is in a position to increase interest rates or pursu

there seems to be this narrative being spun out that mario draghi has said he will do whatever it toeshe is preparing incrementally move. how do you read that tone? >> i love that you say whatever it takes. thes just musing, that was 26th of july 2012. long time ago. we had thought mario draghi might squeeze in a rate hike to create a trend before he leaves at the end of october. that was sort of in the very strong european growth relatively of 60, 70. that agenda is gone now. the ecb might end up having to ease. if the ecbspective, is, that gets interesting. there is no flow anymore. they have this large stock of its -- of historic purchases in governments. could doe things they is intervene in european credit markets on the basis of buying more. the problem with that is you need italy to be on its own. for that you need growth. it is such a leverage play on the world economy. now that plays going very well. we now think this has gone through. it is not absolutely certain of course. his new stock phrases to adjust all instruments. >> he is talking to me there. that is how i interprete

i think mario draghi and the ecb have put in e&p -- and end to that. the other thing is on the ecb. easy told us they are not hiking until the end of the year. they have done the tltro program. what they are trying to do is extend the cycle as much as they can in europe. european growth is weak. there are big structural issues with europe. if there is a reach for yield in europe, where do you go? you want to go into the periphery. i think the periphery spreads will continue to tighten. gershon: we tend to do with the extremes. there are idiosyncratic examples. italy, a lot of populism. the debt crisis. all of these economies are susceptible to the region in general. this will be a systematic component that loads -- that goes along with how the european economy goes. will be idiosyncratic components with how the individual countries work out there issues. victoria: you and i have spoken before when it comes to europe, how we feel there are a lot of things going on particular to the individual country. it is all about china or about global growth slowing down. you have -- it is not al

blackrock's rick rieder looking for a big move from ecb president mario draghi. >> we look at companieseighted average cost of capital. the cost of the the cost of the debt in europe is much lower. cost of equity is too expensive. -- krishna: absolutely. that would signal to me that we are at the number world rather than things getting better. i think it would be a very big mistake on the part of the ecb. there are lots of things they can do in the interim before they get to that step. jonathan: what can i do in the interim? scott: as we are learning the u.s. policy signal can be equally important to policy implementation. a long story on that will be in that were to be put on play, the ecb coming in and playing with the structures on putting more capital into the banking system, there is a limited total rate of return from the ecb's perspective, the transmission mechanism will not be fantastic. they have to extend that facility, have to do it sooner than june. robert: i think that's right. we have a lot of experience with qe. when you look at japan, they have been doing this since the

mario draghi says his concerned about the independence of the u.s. central bank.y: you just touched on the point i was going to make. it is interesting one of the other central bank leaders felt it was appropriate or necessary to raise that particular issue about the independence of the fed because of this doubling down on the rhetoric from the white house. would it change the reaction function on the fed? i don't think it will, per se, but there will be increasing pressure on the federal reserve to contemplate easier policy. not this year, but more so in 2020 one the fiscal dynamics become much more dynamic -- damaging or much more aggressive in terms of correction of the growth dynamics. there is the ongoing dynamic of the white house doubling down in terms of criticism of the fed. that will cause consternation for investors going forward. that's one of the reasons investors may be looking to shy away from the dollar in the second half of the year, because of this interference. i don't think it will impact the function now, but next year we should expect is your