the european investment bank has pledged a 100000000 euro loan if the human trials are successful. buying on tech and pharma companies all over europe are gearing up for mass production of a potential vaccine even if success remains uncertain. you are already equipping our facilities and finding production partners all over the world to help us produce large quantity or something as soon as our production process is up and running will also start producing and stocking it despite the economic risk of having to throw away all this vaccine if it doesn't succeed in trials in mosul so to me. an impressive number of projects including sars kovi 2 vaccine trials are underway at universities and companies in germany switzerland and austria but research is advancing all over the world $23.00 substances are already being tested on humans in projects mainly centered in europe the u.s. and china all told scientists are now investigating more than 150 different vaccine candidates nerdish this is necessary because it's quite clear that no single manufacturer could really meet the world's vaccin

german vaccine champion cure vaca is getting 75000000 euros in loans from the european investment bank the company's carrying out clinical tests on a potential koeppen 1000 vaccine the money while the company complete a production facility and support the development and mass production of the vaccine. german factory orders rose by more than 10 percent last month that's according to the federal statistics office that's less than expected some analysts say the figure highlights just how difficult it will be to repair the damage wrought by the coronavirus orders are 30 percent lower compared to this time last year raising fears that europe's largest economy will continue to suffer from the global recession. and with more on this year's our financial correspondent conrad buson the german manufacturer is not out of the woods yet yes there was an increase in factory orders from april to may but if you compare them a numbers to befall the corona lock down factory orders are still much much lower for example in the german car industry new orders in may were 47 percent lower than in february s

-- is any european bank investable? lippo: if you look at the disclosures of the banks, some of the banks are clearly projecting capital rates. even some conservatives say are -- [al ratio is indiscernible] alix: filippo, thank you very much. filippo alloatti, federated hermes international, thanks so much. james athey of aberdeen standard is still with us. what are your thoughts on european banks kicking off their earnings season this week? james: i wouldn't touch the equity with a barge pole. profitability of banking in general when you have low yield, flat curves, huge economic disruption, it is difficult to come by in europe. you still have bad loan problems that have never been cleared up. it occurs to me that the response is to do more of what hasn't worked and that has been a problem in previous episodes, which is not concerned with the quality of assets. you are concerned more with the optics. all of this liquidity the ecb provides, can keep banks going but it is not necessarily finding its way into economic prod

dominion to abandon the mid atlantic gas pipeline in united states recent announcement by the european investment bank that l n g isn't going to be a part of the energy future because it can be out competed by renewables what that shows is that the transition is actually had both what the fossil fuel industry and governments are already expecting. oil hasn't been the desired boon for countries like nigeria nor is it likely to be as long as prices remain as low as they are. you think about things like the environmental damage of the niger delta. the what's been the cost of foot from nigeria of trying to get on to the oil boom. it's i mean it has been huge in both financial terms because the money that was extracted with that oil never seems to have been repatriated to nigeria and certainly not made it down to those communities that have been most impacted by it but and those same challenges are going to be faced by countries all around the world you know guiana is is looking at an oil boom right now that's been that's been fueled by exxon discoveries there will that money particularly in a low price en

many european institutions and european investment bank and theessf, the first and now defunct mechanismurse and the e.u. they all had some sort of credit e.s.m. capital -- the has capital paid in. theessf has a very strong has a -- the essf very strong guarantee. this is the biggest super national international issue organization in the world by some margin. it is remarkable that given that the e.u. doesn't have any revenue, doesn't have some 500 billion of that will be given out in grants so there is no cash flow coming back. of course the governments are probably committing to make those -- to make the e.u. good in the future all the way to 2058 making the traditional transfer in the future but frankly, what do we know of what the political situation is in 20 30, 2040, 2050. there was a poll last year before the european elections where about half of the population in france, italy and germany said they think the e.u. could collapse in the next decade or two. i think this is well overdone. if you want to rate this triple-a and it is flying solely on promises to the future to contribut

section their ally the new transportation corridors well you're also threatening the european allies new investment banks their payment system you also threaten your own most of the more the u.s. loses its leverage you see the more it will use economic coercion not just against other serious are also allies and as alex put out puts a critically i guess that outcome is. dog sit up to come to the german to do more incentive not to not completely couple about least the 1st 5 or ties and that is an interesting outcome the germans are not taking a stand against the americans this is very unusual this is very much the american results of their policies well alex it's some it's something that the u.s. has initiated i mean it's not germany looking for bad relations with the united states apart from it ok but i mean it's forcing the issue i mean germany is not a country that you trifle with ok i mean it's it's making sovereign decisions about its economy and it's thinking about the well being of the european union is well it's trading neighbors i mean the most amazing thing for me historically at least is that th

investment banking. so compared to any other barclays isyers, clearly top three, top four. that allows them to have a strong profit pool, and then basically be the europeanhoice if you want an investment bank. the distribution of revenues from retail to wealth management to credit card has allowed them, in my view to weather the storm very well. we have seen it particularly in the first quarter numbers, and i do expect them to keep on delivering the numbers, thanks to the data. u.k., they will suffer. while the large player like benefiting. keep on nejra: that is interesting. you pointed to barclays as your investment banking choice in europe, and it is very differently positioned to other u.k. banks. if we look at europe more broadly, how much do expect european credits to benefit from any kind of cyclical upturn in the second half of the year? would you be choosing, for advancingurope over markets? yes -- yes. dadavide: we were per europe credit to emerging-market credit because we think governments be there to emerging markets. secondly, if we look at today europe in the u.s., we are thinking europe, particularly there is much more space for germany,r

cost benefits, but it is about having one underwriting business, one investment bank, one equities business. let's talk about european. .ctavio marenzi joining us ask you a broad question. and the good times that have investment banks see those investment arms as a drag because it gives them a lower rating. are we seeing evidence if you are a bank, it is better to have a balanced business? you need to have trading that when difficult times,, you can balance it out. you've seen that in santander air versus credit suisse. are we seeing a resurgence of the idea that that kind of model does work? octavio: it is certainly a model that has worked over the course of the past couple of quarters. i would go further. the more you are exposed to investment banking and trading, the better you did. the banks that did spectacularly well where people at goldman sachs and morgan stanley who had little retail banking or corporate banking and a basic trading shock. credit suisse was able to ride the results on the bank of investment banking and the global markets group. i suppose you can make the argument it would be best to be morgan

flat structures across the decade >> where do uk banks look here are uk banks actually a better investment than the continental european banks >> the return on equity in the low 60s. that is not great but very different from what we see in germany situation is the opposite given the economy you asked with the brexit and what it means for corporate and the consumer sentiment and what that means on bank spending and it puts a huge amount on the uk banks. >> there are reports the uk is in talks with banks about an industry-wide plan to help with the pounds of bad loans about to come their way what can the uk government do to help weather this storm? >> with the uk economy getting the variety of chief loans out how can they support particularly when the furl owe schemes come off and how will the losses be shared. >> thank you for being with us global head of wedalth of asset management >>> shares in ubi banca are higher the group owns about 19% and had previously prejekted the 4.1 billion offer. the profit plunged 76% in the spekd quarter after the spanish lender set aside 125 million euros in preparation for loan losses b

we believe the federal reserve and the european central bank will support investment grade credit market, see you need to buy those and pick up your additional spread. there are selected parts of the high-yield space to look attractive to us. you think about corporations that will be around in 24 months . the yields are looking attractive, relative to other asset classes in fixed income, and cash which will be at zero for the foreseeable future. we have seen rates across high-yield pickup to decade highs. a complete free ride in that space. you need to be selective. the federal reserve can provide liquidity, the companies will struggle through this environment. that will be important. from a treasury standpoint, i do not feel yields will go much higher from here. own some treasuries and some risk assets. yousef: we will get to some the other calls shortly. iain t. stealey stays with us from international cio, jpmorgan chase bank. still to come, we will speak to right here on bloomberg. i will get into the jobs numbers happening later after the show at 2:00 p.m. london time. plenty more a

chinese economy but if we look at other sectors for example in investment and consumption they asked you a week. when european central bank officials meet in frankfurt today president cristina got to face questions on whether she has done enough to return europe's economy to health one area of controversy is how far the c.b. should go in buying up more dead from weaker as southern european economies like italy and spain at its last monetary policy meeting christina got almost doubled the amount of bones and other assets the central bank plans to buy under its pandemic emergency purchase program to almost 1.4 trillion euros let's go over to all the banks our correspondent in frankfurt i mentioned the fears of china going easy on stimulus what about europe. well i don't see any fears in the market so far on europe on the e.c.v. not doing its part not being prepared to do more if necessary but don't expect any announcements of the e.c.b. is jacking up that 1.4 trillion you just mentioned that was only decided 4 weeks ago any time soon madame lagarde the president made it clear as such in an interview last week with the finan

we have had a big week for european bank earnings where the regis -- the region's largest lenders are taking from investmentnd -- we are delighted to welcome on bloomberg surveillance, philip drury. we are delighted to be joined by a bloomberg wall street correspondent. hello to you both. thank you for joining us. let me start with possible consolidation amongst european banks. we have been waiting for it and waiting and waiting. what is the catalyst? going to think you are be waiting a little bit longer. we thought that earnings from european banks were quite constructive. notwithstanding the cost of credit, which is something shared among all banks, given the uncertainty of covid. we thought that those banks particularly with capital markets activity showed strength in the second quarter. having said that, covid is unpredictable, as we have heard this morning. the outlook is uncertain. i think the real stress test for the european banks will come later in the fourth quarter, and also 2021. the catalyst of consolidation are several. banking is a skill business. also the movements into digital may well resu

news is already in the price for the whole capital structure of european banks from equity down to the subordinated bank debt that i am investedn. bluebayid riley with asset management. over on the equities side, we will continue to look at the stock market. , equityging director strategist at citigroup. we will do that in the 8:00 hour. those tech earnings are coming along in a few days. the fed meeting wednesday. this is bloomberg. good morning. ♪ ritika: this is "bloomberg surveillance." in outlook for a bigger than in nissan.unch it plans to skip dividends after losses. the pandemic has forced nissan to speed up cost cuts. have begun aontech late stage trial for their coronavirus vaccine they are hoping to submit for regulatory approval as soon as october. that would be one of the most ambitious timeline so far. runners like moderna announced it started its own final stage trial. one of america's oldest and makers has filed for bankruptcy for the second time in two years. remington outdoor now plans to sell the two-century-old company. remington was overwhelmed by debt. that is the bloomberg business flash. tom: thank you

investment strategy. we'll take you back to the european banking sector where we see the strong gain this morning. it's an individual story around change of the helm the gains now accelerating for french stocks. 4% roughly the gains there. they're in spain as they won the stronger ones from the outset. this is about clearly what they're concerned about because of natural security law in hong kong and those concerns just being put to one side of the stage and across italy, it's out in front 4.3% so just an incredible day on boarding for european banking stocks. i want to get to why they're clearly in the financial services spaces. the company's core business in europe and the u.s. failed to turn profit since at least 2016. they show that the company's core activities have become lossmaking they were upset by proposed profits. however that money has been found to have likely never existed. wirecards filed for insolvency last month the fed's latest stress test reportedly show a number of sharp loan losses. and hardest hit by the pandemic. it would fair worse. and the commercial real estate and lendin

investment banks by the way the clear winners when it comes to q-2 trading revenues. most of the european banks coming in at plus 40 or 50% year over year compared to some of the u.s. investment banks that are up over 100% year over year. steph, we're getting another reminder of how many hurdles the banks have to get over it gets undone quickly they're holding in better and massively outperforming. the money center banks thet did have great quarters, right? and the stocks are still cheap they don't have as high dividends. i think that you're going to see more dividend growth from a morgue an stanley. maybe not goldman sachs. i wouldn't touch the european banks. the capital levels are not nearly what the u.s. banks r i think there is market share had. i think that's what's been happening. this issy own special situation stories. wells fargo with the turn around morgan stanley with e-trade. all these things are down-and-out i think into a recovery into next year they should do better. >> some chief price to book multiples though, steph. if you do want to venture on that side of the pond. mi

investing style. ♪ . >>> john, that is right. european markets moving higher today lead by gains in the bank, tech, and auto centers retail sales roselmost 18% in may. still down more than 5% year over year. the european condition is giving conditional clearance to remdesevir finally one of the top gainers in europe today is commerzbank still, the resignations came as a shock as they called for a more orderly transition at the bank which it called disastrous. back to you. time now for a update, let's get back to sue herera >> nicholas cordero has died at age 41 from covid-19 complications. he was on a ventilator, placed into a medically induced coma, and had his leg amputated. >>> north dakota officials say that will have a significant consequence. for more on the judge's decision go to cnbc.com >> under china's national security law foreign media outlets will be required to provpr provide information ontivitieons >>> a statue of frederick douglas has been ripped from it's base on the anniversary of one of his most famous speeches. wsu're up to date, that is the ne update this hour, "squawk alley" returns in two minutes. hey frank,

you talk to those within the business who invest in these businesses, do they see any hint of a longer-term shift away from the u.s. back into european bankingli: i would not get that excited, but what i would say is the eu you have to look at different spots. when it comes to deutsche bank they said germany might suffer less than the surrounding economy given the fiscal support. they are bound to have lower loan losses. we have less than one billion verse -- less than one billion worth of provision announced today. i would look at the relative trait in europe on top of the u.s. versus europe when it comes to valuations. guy: as ever, thank you very much, indeed. great insight into what is happening within some of the big banks, particular investment banks. let's pivot and talk politics and fed politics. inare seeing a huge shift the global security architecture. the u.s. is planning to withdraw around 12,000 troops from germany. some of these will be redeployed elsewhere in europe, and some will be brought back. president trump frequently complained about the lack of german defense spending, saying "they have taken advantage of us for many

investment bank. we will bring you our interview with the ceo. welcome to "bloomberg surveillance." i am nejra cehic. we are seeing european equities accelerate to the downside. the stoxx 600 down 0.6%. futures pointbut to a lower open. the five year yield hit several record lows. target rangeow the from the fed. let's get the bloomberg first word news. laura: the u.s. death toll from the coronavirus talked 150,000 -- topped 150,000. texas, california and florida had record cases. dr. fauci warned more protection will be needed. he said if you have goggles or a face shield, you should use it. facebook's mark zuckerberg was speaking alongside the bosses .rom alphabet, apple he says facebook lags behind its competitors. credit suisse says it will merge trading and investment banking and combine its risk function. the chief executive says it is the first major rebound of the swiss lender. undoes some of the decisions by the predecessor. >> the bank merger is something we have been discussing for months. bute will be cost-benefits, it is about having one underwriting business to have one investment bank globally. global news,

european futures are rallying with asian equities. spoke expectations for protracted support from central banks. we are joined by the street -- chief strategist at the investment i wouldn't normally ask about but iys market action, wonder if you can reflect on the strength we are seeing through the asian session and european futures. little has happened since thursday when we last saw the u.s. in full play other than some ongoing bad news around infections. i wonder what it is that you think is driving an improved sentiment in the u.s. data. what is it that points onward and upward for you? i don't -- it is clear this is not about -- what this is retail environment to many of these markets. i do think liquidity is still driving these markets, the main driver of these markets. q2 market is thinking the will be bad enough, but at this point -- improvement in the month. in june, we are seeing -- the u.s. labor market continuing to get weaker and the initial bout of spending slowing down. from the middle of june, patents marketsun to change and a raleigh nonaccredited, particularly retail liquidity in markets like china. that means we have to because she's from ch

investments right now. halinda: let's get the first word headlines now. the european bank has warned the euro zone is facing about two years of downward pressure, but could see a turnaround after that as covid transforms the economy. speaking during a webinar, christine lagarde says she expects a period of disinflation to begin, followed by inflation, and the possibility of higher rates. inflation dynamics will be impacted with disinflation to begin with, then inflation that will occur that we will have to measure. but it will most likely be based if we have an increase on productivity on a natural increase in interest rates. halinda: north korea is joining new talks, saying washington is using the idea as a political tool. relations with the u.s. and south korea collapsed last month as pyongyang accuses rivals of abandoning promises made. says sanctions will change the relationship. pyongyang says it has a detailed strategy for dealing with the threat. governor has been reelected for a second term in a landslide victory as the city deals with its surgeon coronavirus cases

european countries including here in germany. goldman sachs has agreed to pay almost $4000000000.00 to the malaysian government to settle claims related to a sovereign wealth fund malaysia's finance ministry said the us investment bank and knowledge the misconduct of 2 former employees in a corruption scheme prosecutors say the bank organized bond sales that allegedly allowed former malaysian leader. to pocket hundreds of millions of dollars. let's bring in our financial correspondent in new york standing by for us hi yes a what was goldman's role in this scandal. 1st of all it really has been the huge scandal that eventually led to the ouster of malaysia's former prime minister so goldman sachs did tell 4 sovereign wealth fund to sell bonds and the total amount of about 6 and a half a $1000000000.00 and about 2 and a half 1000000000 of those got diverted to some senior officials and they used the money to buy $250000000.00 yacht for example they also actually financed the movie wolf of wall street they bought the oscar of former actor model on brando and goldman sachs they actually got a fee for about $600000000.00 a huge amount for the sale of those bottles it is a pretty big payout we're talking about almost $400

investment banking. thank you very much for spending time with us here on the european market open this morning. business flash. top corporate stories we are focused on. huawei. is poised to ban from its next-generation mobile network, reversing an earlier go ahead. phone companies will not be allowed to add new huawei components to their 5g networks by the end of the year. all existing equipment by the chinese firm will have to be removed by 2027. boris johnson is expected to set out the plans and parliament later today. european union judges and luxembourg are set to issue two crucial rulings affecting the tech sector this week. first up will be a judgment on the eu decision to slap an irish back tax bill on apple. in a separate filing later in the week, the eu's top court will decide on the legality on tools used to ship commercial data across the atlantic which up -- without violating rules. softbank is said to be considering options for selling at stake in arms holding. the chip design company would go --lic as soon as next year company in theop sector in 2016. primed for an ugly earnings s

investment. it describes overall conditions as severe, although that is better than extremely severe description back in june. the european central bankning toward asking banks to delay dividends this year, weakening hopes that payouts could resume in the next quarter. sources tell us members of the supervisory board don't see enough in the single market economy to justify lenders returning capital. no decision has yet been made. the ecb declined to comment officially. hong kong secretary for food and health has warned the coronavirus crisis is at its most severe moment. joining us is simon wong, kampery group chairman. thank you so much for joining us. how bad are things? we got another extension of restrictions on restaurants. they are hurting, aren't they? simon: they are really hurting the business. after 6:00o business p.m. every day until 5:00 a.m. in the morning. doot of restaurants cannot any business and they have to close down their business or they have to operate their business in a sordid time. while i think some restaurants withdo daytime business dining in, but after 4:00 in the afternoon they would simply close down th

european central bank recommending a bank dividend ban through the end of the year. in asia overnight, markets were mostly higher, chinese president xi jinping calling for the asian infrastructure investment type of multilateral institution that promotes development across the world. the best performer overnight, korea, kospi index up 1 and three quarters percent. with less than 100 days away from the 2020 presidential election, former vice president joe biden is facing an enthusiasm gap with president trump. a new poll finds seven in 10 trump voters are looking to reelect the president because they support the administration, while 27% say they're voting against biden. biden has a less devoted following with 37% saying they're pro-biden while 60% say they're voting against trump. joining me now is former u.s. ambassador to the united nations and former south carolina governor, nikki haley. governor, great to see you this morning. thanks very much for joining us. >> thanks so much, maria, for having me. maria: assess the field for us right now, if you will. what do you think voters are looking at as priority come election day now with about less than 100 days to go? >> well, i think you h

european equities investable again. the u.s.performance of equities versus others has been colossal. anna: and through all of that, one of the sectors that has underperformed in europe is bankingakes me think about that being where a lot of european exposure is. how likely are you to turn bullish? seen a couple of flurries in value but these have died back rather quickly. the overarching issue is one of we need to see more sustained recovery and the more we see a v-shaped recovery being sustained, the more chances we have of outperforming and the more likely we will see a resurgence of interest inflation. we don't see it in the cpi numbers yet the people are thinking about in a year or two, stimulusis massive being thrown at the economy, what if it results in pockets of inflation? what does that mean for the stock market? that would be the ultimate catalyst for the value. is somethinghat that no one believes in yet. everyone is looking intently. no one has pulled the trigger yet. rallies,, theyor are dramatic and they typically the point where no one believes in it. much.thank you very we will get back to you shortly. edmund shing from bnp paribas stays with us. let us take a

of the market i think the european financial sector, broadly speaking, whether it be insurance or asset managers like a schroder, a credit squeeze, private bank, and investment banks these companies are trading at around half, two-thirds, 50 or 60% of book value and they should be able to earn double digit returns. so it's, to us, a strong value proposition. you're going to say, yes, david, you've been saying this for a few years. now last year, by the way, they actually did quite well as a group. european financials. i would expect from these levels you'll see similar price appreciation over the medium term based on the quality of earnings and the price of the business. >> thank you so much, david. good to see you. >>> this is the last commercial we take before we head to the close. up next, untptnierrued coverage of the final moments of trade as we take you inside the market zone [squeaky shopping cart] [sniffing] is the salmon wild-caught? she only eats wild caught. [cash register beeps] uh, i need a price check on honey. don't get mad. get e*trade and get more than just trading. investing. banking. guidance. >>> 13 minutes left in the trading day. we are

investment grade liability structure are very well positioned to continue to perform through this kind of distress. anna: that was the ceo of ares management speaking to our colleague. next, back to the european corporate banking. deutsche bank plans a 10 year cloud computing alliance with google. we speak with the ceo at 9:00 a.m. u.k. time. we will get a rundown of what is going to be covered in that conversation. ♪ anna: welcome back to the european market open. we could take a fall after yesterday's rally in tech stocks. european futures down by around 0.7%. kong leader carrie lam has defended the national security legislation imposed on the city last week. comments come hours after her excepted broad new policing powers including online surveillance and property seizures. >> in the past few days, some have said there is a rhetoric of law that will help to promote stability in hong kong. you see in the market, that has been the direction taken. anna: italy plans to expand public investment. the nation is focusing on boosting growth rather than in debt.- reining gain 3% of gdp. emmanuel macron has reshuffled his government. bruno le maire is staying as finance minister. the foreign affairs minister remains.

investment director at brewin dolphin stays with us. jp morgan records record results. sachs.deck, goldman we talk u.s. bank earnings next. this is bloomberg. ♪ ♪ welcome back to "bloomberg markets: europeant 10 minutes into the session, which is proving to be broadly positive for european equity markets, lifted by hopes of a vaccine. citigroup, and wells fargo all reported earnings $47erday, setting aside debt.n in 2020 for bad next to report, goldman sachs before the u.s. open today. joining us is dani burger. different stories being told by jp morgan and wells fargo. is there any big take away from the banking industry so far? dani: it seems like the message coming from executives is that the worst may be yet to come in terms of the u.s. economy. wells fargo having its first loss in profits since 2008. jp morgan having a better-than-expected earnings thanks to release strong underwriting investment banking and notably, a consumer without as many delinquencies as we had expected. diamond -- jamie dimon saying that this has more to do with the stimulus, that we are likely to see the effects of recession down the road once stimulus has started to wear off. we saw similar comments from cit