cost iag $103 million.he airline launched a budget airline called level last year, offering fares from barcelona to several us cities for $137 one way. this transatlantic market, the most lucrative in the world, saw budget carriers boost capacity on these routes by 68% last summer. with me is daniel roeska, transport analyst at bernstein research. thank you forjoining us. let us start on what you can expect. generally the picture looks very rosy for iag. absolutely. what we're seeing is that the trading is exceptionally good. signal factors are up. you mentioned the mike mack consolidation. there is out of the uk have temporarily gone up for iag. —— ——monarch. uk have temporarily gone up for iag. -- --monarch. seeing airlines like barataria and -- --monarch. seeing airlines like ba rataria and monarch -- --monarch. seeing airlines like barataria and monarch disappear, it does not take long. in the third quarter we will see the market quarter we will see the market quarter being observed... it takes a while.

will go on to groups like iag.s like iag. one of its biggest strength is that it has a wide portfolio, it covers different business models, it attracts customers and brands. the premium end of the customers with airlines like british airways and iberia so it's covered in all angles and is very flexible in how it deploys that capacity, willing to move aircraft and routes as it sees changes in the marketplace. since its formation with the merger of ba and iberia, iag has been mopping up allies. today, thomas cook has been ruled out but can we expect iag to add further airlines? i think it's interesting to me that they pulled away from the region, i primarily a low—cost airline, a new business model proving popular with customers. it has a lot of challenges to address which i think is what made iag pull away from it. i think they will selectively look at other airlines let fit in with theirfamily, so at other airlines let fit in with their family, so to speak. all the other airlines that have come and have been profit

the first takeaway is that iag has performed well in absolute terms and relative to some of its peers routes that you have mentioned and it benefits disproportionately from that activity, as well. in the post—pandemic world you have seen a degree of abundance in travel simply because we had cash and the inclination having been restricted somewhat, but it is only reasonable to expect higher interest rates to curb the consumer demands in a way and the delay in those interest rates taking effect means that is to's but not for iag. they have performed pretty well relative to a lot their peers. travel demand remains high but seeing high levels of air traffic flow restrictions recently. yes, i think a lot of what iag has been able to do is try to navigate away from some of the industry problems. they have a range of different fleet. ryanair had some problems on that issue. they have flexibility in terms of the network, so that has been a meaningful advantage. they have also had a degree of capital discipline, so debt has fallen as a result of that they find themselves in quite a strong posi

iag as the demand for. . ._ banks moved was cutting rates. iag as the demand for..._ as the demand for... apple has been forced to apologise after _ as the demand for... apple has been forced to apologise after its - as the demand for. .. apple has been forced to apologise after its new- forced to apologise after its new ipad commercial sparked an outcry around the world. the ad showing books, musical instruments and art materials being crushed by a giant hydraulic press was supposed to issue how creativity has been compressed into the latest ipad. but is it has been seized upon by critics, who says it sums up the cycling of duty by big tech, and even the threat from artists by artificial intelligence. so how did you get it so wrong? mark, for all the outcry we have seen online, as it speak to a sense of tone deafness by apple here? i it speak to a sense of tone deafness by apple here?— by apple here? i think it is corporate _ by apple here? i think it is corporate hubris. - by apple here? i think it is corporate hubris. for- by apple here? i think it is corporate hu

and that leaves iag in a difficult position compared to european competitors.dressed this? there must be a lot happening behind the scenes because very little is happening in front of the scenes. again there is a level of reassurance that everything from shareownership within iag and the kind of connecting traffic that british airways in the uk operating licence brings to the is very significant. it is not something you canjust significant. it is not something you can just sweep under the carpet because you are talking about a0 yea rs of progress because you are talking about a0 years of progress that the presence of companies like iag across europe symbolises. how about norwegian? two bids have been rejected from iag. why is it so eager to purchase norwegian? it is an interesting play and one could represented as everything from an exploitation of the market that they are not in to ta ke the market that they are not in to take out strategy. if you look at the roots that norwegians fly from gatwick, what some fly head—to—head one way 01’ gatwick, what some fly

when compare iag to us. when you compare iag to other european airlines, it has m- this?this? yes, it's done very well. doing this? yes, it's done very well- the _ doing this? yes, it's done very well. the margins _ doing this? yes, it's done very well. the margins that - doing this? yes, it's done very well. the margins that they i doing this? yes, it's done very| well. the margins that they are are some of the best achieving are some of the best the world achieving are some of the heat the world for an airline. e haw are'they'd'aing'it? ithink very bae in particular, on the transatlantic. that market is much in demand and it is fairly 25” city_ 7 e c—fiaity, m” tight capacity, so when you look at their numbers, their revenues were very strong in the transatlantic, that is where the beat estimates. when we talk about _ where the beat estimates. when we talk about these _ where the beat estimates. when we talk about these very - we talk about these very transatlantic routes, at leisure or is it is at leisure or is it business, do know? is at leisure or is it business, do

you talked about iag. up 1% at the moment. after six months of waiting we see the irish government has given the green light to the government stake in aer lingus being bought by iag. it looks like that extra hurdle of getting pushed through has put iag that much higher. this is the retailer. big presence for the united states. the laces for these two companies are meant to be combining up by 1.5%. no news on m&a. investors want to hear it was a more clarity on that deal. u.s. sales looking flat relatively weak, coming in less than expected. they are having to put more money into promotions. they have competition in the u.s. we have the exclusive interview of general holiday -- generale's chief executive. positive economic position and their cash flow looking good as well. back to you guys. jonathan: after a day of losses a little bit of a rebound in the market this morning. the dax up .2%. we are going to athens for the latest on the g-7 meeting and a conversation on greece. and we bring it back to the u.k.. prime minister da

iag would take out a competitor. does iag need more than the other?hat seems to be norwegian's biggest lagos that they don't have the support from a bigger network in case something goes wrong. if norwegian has some disruption, the only wait for them to get passengers from london to new york is to use another aircraft or put them up in hotels, which costs a lot of cash. that is weighing on norwegian. otherag offers is airlines -- british airways. qataraught our -- airways. it generally support the norwegian mechanism. mark: iag strong today, outlook looks good for the year. that was very. ben: remarkable, actually, earnings from iag. they're quite bullish on the rest of the year. z on the tussle, we will call it, between iag and a norwegian. vonnie: we will be talking about telecom later on. interesting outcome there. coming up, the federal reserve is back in focus. we will speak to the former fed governor kevin warsh. this is bloomberg. ♪ mark: live from london, i am mark barton. vonnie: from new york, i am vonnie quinn. this is "bloomberg markets."

around how iag as a group would have performed in that half year?e good. in the context of the whole industry and they are not the only ones in this situation. ryanair last week, they had a 50% pay cut. lufthansa... we are in downward circle at the moment. we have had a really good run in terms of performance from many airlines and now what we are seeing is everything conspiring against them. a lot of cost in dollars for iag and ba which has revenue in stirling and that has devalued. anecdotally, you know, in terms of friends family colleagues, i get the sense that people are flying more, especially shorthaul, than they used to ten years ago. and yet the airlines are still facing these pressures, presumably because these pressures, presumably because the margins become so tight and the cost becomes increasingly burdensome. capacity this summer from the uk has been up by i.5%. so more and more people are travelling but the reality is we have too much capacity in the market and that means people are getting really good fa res means people are getting

iag's plans include building a new trans-atlantic hub at dublin airport. cyril: that is it for the day's business news. now it is time to take a look at the press review. thanks for joining us here on "france 24." florence villeminot is on the set. a lot of focus of course on the greek debt crisis. florence: europe is really holding its breath against -- ahead of sunday's reform deadline. it seems like papers are running out of creative ways to talk about the greek debt crisis. i did find an amusing article that likens european negotiations about the debt crisis to a big poker game. very creative, different way of looking at things. it calls the greek prime minister, alexis tsipras, the greek bluffer. cyril: i notice all the chips are in front of mario draghi. florence: exactly. he has a lot of power. alexis tsipras only has one ship left and is all out of trump cards. the german chancellor, they call her uncompromising. she has a good hand, but she has a lot to lose. i like the way they call the french president -- they say he is a pretty good bluffer. he

what is it about norwegian that fits so well with iag? why is it so important?m isa with iag?ery large, pan—european, low—cost airline with a solid network. you know, it's got a presence at gatwick. that could be quite nicely consolidated with a british airways operation. that would work well. what we have seen over the last two matter years is british airways following norwegian into long—haul markets. they've gone to fort lauderdale, they've gone to california, following norwegian. it would make a lot of sense for that to be scared back to just one airline operating, because you tend to make more money when that happens. talking about budget airlines, we had one of the darker clouds within the set of numbers? 0riginally clouds within the set of numbers? originally a spanish —based airline, they have to micro herbs in paris, one at charles de gaulle, and they have one in rome. bosch they have two herbs. they fly over french airspace and get it more than anybody else. the other irony in this is that air france are one of the poorest performers in europe at the poorest performe

so how damaging will this be, do you think for iag?ost of the strike today and there's more strike action scheduled for two was the end of the month if there is no agreement this week. and ba has a legal duty, doesn't it? to find alternative routes for passengers which might be with competitors. exactly. the only winners are the competitors. customers suffer, they're going to be angry, somewhat threaten and indeed not fly with british airways again. the direct cost of lost reve nu es over again. the direct cost of lost revenues over £40 million a day. that gives the urgency to solve this. when we move into the medium term, this resolution, i would expect this to come back, there have been a series of pallets rugs which went on three and a half years until 2017. that is something we would have to have — my crib is in the mind of the union and get this thing resolved quickly so the company can get back on track for its customers and maintain its strong performance which is to the good of this workforce as well as travellers. john, thank

breaking news from iag. we will certainly return to our top story. let's get to iag.he adjusted operating loss, no surprise that we are getting a loss from an operator in the aviation space. full year adjusted operating loss, 4.3 7 billion euros against an estimated loss of 4.43. that's a bit better than expected. it is not providing -- this business is not going to provide profit guidance for 2021 at this stage. perhaps they just lack of visibility. we know the ongoing conversations about opening up various european economies, which will be so crucial to the iag story. they are giving us revenue numbers as well. passenger capacity plans for the first quarter of 2021 are around 20% of 2019. that gives you a sense of how much smaller this operation is compared to pre-pandemic. that is the corporate story when it comes to iag. we have seen a pickup in bookings, notified by the markets to competitors of iag. we have seen a pickup in bookings for european aviation. let's get to these markets. this is what futures look like right now, down by 1.6% on euro stoxx 50 futures.

hearings in my role as the iag council chair on issues that affect the iag community. >> speaking of council chair. back in 2008, the government authorized the council of the inspectors general on integrity and efficiency. first, why did you need this? i would assume that's what you're doing anyway. and what does it mean? whip are you first chair on this? >> okay, well, as you point out in 2008, congress statutorily created the council. prior to that time, there was no statutorily established entity. over the years as the ig community evolved, various presidents had created councils -- one counsel for the presidential appointed igs and one for the agency heads. over the years we came together as a community to work on issues of common interest. at the time of 2008 legislation, there was a view that it would make sense first to merge the two councils together so we'd have all igs together in one council. secondly to deal with the issue of providing training to our staff, which was an ongoing and open issue. and third to encourage us to work properly with iags on issues that span agenc

i saw the ceo of iag talking about 2023. there is certainly an expectation that may be long-haul is going to take longer to recover than the short-haul, and corporate is going to take longer than leisure, and perhaps it is going to be shorter for longer with the likes of zoom. so the airlines have to make that up another way. for example, iag pre-pandemic was saying they could generate 2 billion need plus -- 2 billion plus euros in free cash flow, so they certainly have restructured , and to come back to where they wear pre-bid -- pre-pandemic before that happens. guy: does premium economy help? using we will see more of that? do you think we will see more vfr traffic towards the front of the plane? what can cargo do as well? david: the airlines are certainly pushing that they are changing their inventory mix, so you see a lot of them talking about premium economy, a lot of them talking about premium as mixed between leisure and corporate. so aircraft are talking about a premium business with leisure. if this is the case, ma

iag getting a new shareholder.r airways. >> how jack ma lost $1.5 billion in a single day. ♪ >> time for today's company news. it has been announced that qatar airways has bought a stake in iag. the say they are delighted to have them as a shareholder. jack ma is no longer the richest person in china. his fortune fell after alibaba shares sunk on missed estimates. he is now only worth $26 billion. shake shack has raised 26 -- money in their initial public offering. that is according to a public statement. they boast a valuation of $746 million. two former traders have been charged with allegedly cheating their employers. they worked at hsbc and deutsche bank. they used the banks accounts to get preferential rates for themselves. >> russia could be facing further sanctions from the eu and u.s.. moscow appears unmoved as the conflict intensifies in the ukraine. let's get more from the senior oracle analyst. always great to get -- political analyst. the rebels are pushing towards crimea. putin seems unmoved. europe ha

one is iag.nfirmed a data breach as a result of which, you can see iag's stock price is trading down quite sharply. it's firmed a little bit. trading down by 2.2%. matt miller? alright, now to the middle east and qatar's minister told their embargo has been a blessing economically. he still sees opportunities in some emerging markets, as well. he spoke exclusively to bloomberg on the sidelines of qatar's germany business investment forum in berlin. >> i can tell you today that the embargo, or the blockade on qatar, and the blockade from our neighbor is behind us. we are doing excellent. in fact, from an economic one of you, -- point of view, it's a blessing. let's look at the numbers. in 2017, we met our growth targets, which was 1.6%. our total exports increased by 19%. total trade was 60%. total surplus increased by 48%. and the world bank expected qatar would be the highest growth in the region would be an 3%ar, 2.8% or 2.9%, and following that until 2022. there are huge growth opportunities a

what is it that iag is doing so right right now?lements, overall regulatory framework which is common, economic geography coverage of the region they are in and a flexibility of business model and what iag is doing very well at at the moment is that ability of business model across the whole spectrum of markets. do you mean from cheap right up to the luxury end of the market? leisure to business end of the market and also reflecting the demand in north—west europe and south—west europe as well. there are some gaps in that, they have some gaps they could fill in terms of the market? looking at central europe and eastern europe, the coverage connecting through london and madrid is quite weak. so i think that is something that was indicated about their interests, for insta nce indicated about their interests, for instance in nicky, to fill the gaps. when we talk about iag we often think about british airways because it is the big lump within this body of companies but obviously, their main hub remains heathrow, discussion about a third

to iag. euro selloff comes as an extra cash in stocks. we are in dublin with the latest. what did iag give ireland that suddenly prompted this decision to approve the sale? >> this has been dragging on for over six months at this point. ireland is an island nation. therefore, connectivity is an important part of our strategy. when iag first made a bid to guarantee the routes between london and dublin for five years we yesterday learned that they had increased that guarantee to seven years or at least seven years. they also gave the government power over the heathrow slots. that gave the government to say, -- government the comfort to say, we are ok with this deal. caroline: the next six months what happens? dar thea:a: some significant news this morning. there are six or seven members of the labour party, they have always been against it, but we learned they are going to back the deal. that is a significant development. willy welch is going to be in town today. he has a press conference at 11

if you look at iag this year, their target is up 25%.ael o'leary saying that prices will remain elevated for potentially five years. in terms of cargo, how significant is that for the likes of iag? it was a factor for lufthansa. is it a factor here? benedikt: is a factor across the industry and we are seeing cargo level off again. it has to come back from the elevated levels we saw during the pandemic. shopping behavior has changed again. some of the supply chains are coming back. so the cargo that helps airlines through the pandemic is coming back. with lufthansa, they had half a billion in profit in cargo a year ago, and that came down to 50 million, and that is something we will see across the industry going forward. francine: thank you. that is benedikt kammel from our aviation team. coming up, it will be a historic day in the u.k. tomorrow. we found out that the vice president of the commission will also be watching. tom: he will be watching with millions of others the coronation of king charles iii. the streets of london will be pa

we also get numbers out of iag as well.n, prime minister sanchez is expected to name his cabinet. the brexite u.k., deal law proceeds to its third reading in the house of commons, this time seemingly with a chance of passing. later in the u.s., the fed vice chairman speaks to the council on foreign relations in new york, and st. louis fed president james bullard speaks to the wisconsin bankers association in madison. to -- oh, all right, i will tell you more about exit. boris johnson and ursula von der leyen set out rival red lines for their vision of a post-brexit deal. said britain will not stay aligned to eu deals, which i feel like was the point of the whole thing. saying it der leyen will be impossible to get a full deal by johnson's end of year deadline. redlines have been set. aside from those that are perfectly obvious and that we already know about, what are they? right.that's they are obvious, but it is significant that ursula von der leyen and her first trip to london, first time she met with the prime minister s

you have iag, aer lingus. aer lingus say they are discussing a new bid from iag. iag down and eight of 1%. apparently ryanair's holding has been on the block for one month. >> that is how markets are opening up. markets are a little bit lower. i am looking at the footie down by half of 1%. the greek anti-austerity party won the decisive victory over the weekend. guy johnson is standing by. i guess the big question is what this result will be for greece's future in the eurozone. are we getting a little ahead of ourselves? >> i think we will find out. it's going to be an interesting morning. it was a fascinating night last night. he arrived with police outriders. he is prime minister elect. you got a real sense watching him talk to some of the activists, a real sense of relief that they have done what they set out to do. a big win last night for his party. as he addressed the crowds, he talked about this being a turning point for the greek economy. >> the sovereign greek people have given a clear, strong, indisputable mandate. recessed turn the page. greece is leavi

success toerkshire's the proven activities of iag is involved in.e are seeing a significant endorsement of the strategy we are following across the asia-pacific region and recordation of the strong franchises. u of also said it will reduce your exposure to natural disasters. but, whatustralia kind of impact of the climate change will have and the ability for you to provide adequate insurance cover for assets in those countries? : well, we are the largest insurer in australia and new zealand and will divide comprehensive cover at this stage and we believe it will be viable. the climate change, we do ring that what -- we do think that what we're seeing at this age is a natural regression of the environment as much as anything else. given the capital strength of iag has, the further strengthening and flexibility of the arrangement we entered into with berkshire. be able towill provide capacity particularly in australian and new zealand market. shery: doesn't the deal change your business strategy at all? countries sucher as thailand, china, vietnam, in

a big rich brother like iag coming over the hill.'ve learned to respect willie walsh's views, he said a terrific track record and certainly norwegian is a good strategic fit for iag your lufthansa. there are some top edition crossovers in places like spain where iag is very large with iberian wailing and norwegian has a big basis in madrid and barcelona. that would be a challenge. ceo.et: that is ryanair still ahead, trade truce. tensions seem to be easing of it with china. one of the risks -- what other risks should investors keep an eye out for? this is bloomberg. ♪ scarlet: this is "bloomberg markets," i'm scarlet fu. julia: i'm julia chatterley. listts getting a list -- a -- a lift from the trade tension easing. u.k. inflation data to. barton, eatonyana vance management. assuming de-escalation of the tensions between china and the united states, and being optimistic, are you equally optimistic or is it early days? optimistic on are the companies that we own and the prospect of the earnings trajectory, irrespective of the backdrop

also, the economic environment is a bit of a concern for iag.ve people concerned about global growth outlook, demand outlook, and we certainly saw weakness in the cargo numbers in this earnings report. guy: and they just launched their new business class seats as well. emma, thank you very much indeed. vonnie: it is time for the latest bloomberg business flash now, a look at some of the biggest business stories in the news right now. -- secondpital quarter withdrawals of 849 million dollars, bringing assets below $10 billion for the first if -- atears, at talks och-ziff. alphabet's google is trying to fend off more scrutiny. it will require competitors to enginesave its search included on android devices. a deall soup has inked to sell international operations to kkr. deal completesn the asset sale plan announced last august. the company trying to pare down debt. that is your latest bloomberg business flash. still ahead, rounding out a big week dominated by central banks and trade headlines, we are speaking with david riley, riley, asset bluebay

you would assume iag was included. >> he said he offered it to iag but it hasn't sold.ked, do you think you're going to get competition approval. they wanted to buy aer lingus. they have been told they couldn't. he predicts the regular readers -- regulators will treat them in a different way and allow that deal to go through. >> how angry was he? >> he didn't seem that pleased. they did say he has been offering it for a while. >> we will leave it to mark to do the next interview. you said yourself up. what do you think? the cost of getting from london to dublin? >> you flew further up north in dublin. >> i cannot talk about that. i don't mind which airport i fly to. letting the secret out here. coming up a new set of challenges. how difficult would it be to control the left wing? that is the issue for discussion next. >> a historic victory means greases eager for change. the liver and will bring many challenges. how successful will the party be in facing those challenges? we welcome the managing director. thank you for joining us. what coalition do you envision in greec

s moa sgapren rtomotas roinmbgo ha do incinedost s l imÁge iÁges s mos a mosÁrsas vots raue do el ndo pasao con an gabeln sÚltimas hos la fil tambÉn ta muy penditeel trla dju gri y taiÉpa estaruy peieese su legadtos s mbsÁs poans de Úsi eess momeosa uzo fntera sdel esdo de ihhues el ta quvinacer ju gabri anabelsl tado beo uiral naciÓ en un peeÑpulio ndsupÁs par m duroora tuaciÓn economicaa e estan unÍ decidviajar haa ciudad Áre Í eÁ todos losfansam aer el deo ahÍ eÁa rana fecid de asladoe an gabrieelaso a ciud Áre esmomupendieesorque nohadio la z lzona e la va lgaalug dondspasa lfrtera sin embargno hemos tidrest deso perlaente head acosdaayuc ficda taiÉen mucs sentimieo inus sfamiliha esto muy penen dto eo ees Ídepomovelaamilian e momento aborndtaiÉn los aumÓles llegando al lugar stya podosernt sus Árbos tallan aa opda de ju gabriel en udd juÁznaasquha si rodea de flese cart de imÁne nhaaro begee ahÍ noe querido sar del gar la gente esta eerando por jua brielurteor einclus han viajado a ferentes gas mÉxicoestados unos haen rordoqusuran la10ascinco horas pa estadesde muy temprano solam

we are looking at iag.y of british airlines falling -- british airways falling. emma chandra is here with more. emma: pilots striking for two to scrapforced ba almost their entire timetable, losing more than $100 million. the row is overpay. british airways pilots ejecting a pay offer. they want a share of the profits. we are looking here at iag, the parent of ba, how their profits have increased over the years. they came in at 2.5 billion euros in 2018. despite those profit gains, if we switch up the board we should be able to show you how investors have actually soured on iag. we're looking at the stock price over the course of the past year, down some 36%. this is even as analysts like the stock. 70% of them right it a buy. if we switch of the board again, we should be able to see the stoxx 600 travel and leisure index. hat shows how iag languishes at the bottom behind a number of other companies. the concern among investors looking not to be strike action, but instead the possibility of a no deal brexit

the company says it received two separate proposals from iag. the proposals were reviewed and rejected as they undervalued the company. the board remains fully committed to generating a strategy to the benefit of shareholders the other factor was the statement from the qataris recently around iag. they said they would support moves by the company towards norwegian air. the question is what happens from here and whether iag launches a better proposal the stock price is down heavily, down 8.8%. >>> coming up, it's a boardroom showdown for elliott and vivendi as they go head to head over hell telecom italia (barry murrey) when you have a really traumatic injury, we have a short amount of time to get our patient to the hospital with good results. we call that the golden hour. evaluating patients remotely is where i think we have a potential to make a difference. (barry murrey) we would save a lot of lives if we could bring the doctor to the patient. verizon is racing to build the first and most powerful 5g network that will enable things like precis

in iag today up by fascinating to see how that proceeds.wn 6/10 of 1%, boosting profitability and the automotive operations by record sales of the model five series sedan, all sitting the negative currency headwinds and increased technology spending. the world's second-biggest luxury carmaker in the midst of a record rolled up with new and refreshed models to recapture the sales lead in the segment from daimler unit mercedes-benz. bmw down 6/10 of 1%. mark: jobs -- vonnie: jobs today in the u.s. with the dollar strengthening. 2.77 is the number to watch. and this is the dollar versus the sterling. yuan, i knowhinese the chinese talk about their basket of currencies and the reference rate versus the basket. it is important to look at the reference rate when it comes to the u.s. dollar, given we do not have any progress on trade talks. steven mnuchin leaving china last night with no progress being made, the promise of more talks. 2.96, slowly going higher against the 10 year yield after it went down to 2.93 and change after the jobs report. c

most 10% loss for iag. air france down 7%. down almost 10% and ryanair seeing losses of close to 8% in the session. ruining us now is our transport industry reporter. -- joining us now is our transport industry reporter. as we look ahead to what many would have hoped in the industry would've been a decent season for the airline industry. >> good morning. for the airline industry, this is a double blow. we have seen the likes of the airline industry having to face lockdowns across europe in places like austria and now, with this south african lockdown and also the travel ban, you basically. a 1-2 punch for the airline industry. it was really hoping to recover from the pandemic. we are still not out of the woods with delta. travel was just beginning to start again and this will come as a blow just as they are getting restarted. francine: i have to say, a 20% move for iag is pretty punchy. what are the airlines saying? is this the worst case scenario? >> i think it is a case of that because the airline industry is saying that it

where is the chief executive of iag 7 disgrace. where is the chief executive of iag?at about the chief executive of ba? yes, the big honcho is the head of iag. the silence has been deafening. yesterday in madrid, shares fell by 396 yesterday in madrid, shares fell by 3% which i thought was very generous. i think they will fall 10% soon. we have seen generous. i think they will fall 10% $00". we have seen a generous. i think they will fall 10% soon. we have seen a very different view on this, we saw that this was a two—week wonder. everyone will be very angry, shares will go down, and then ina very angry, shares will go down, and then in a few weeks, when you're booking your next flight, you will look out british airways and think, 0k, fine. it depends what else is out there. you've got to think of the business flow over a year. i think they could be damaged for a period of six weeks. what would you be advising them to do? people were having to pay hundreds of pounds to get on a different flight. they didn't get compensation. they will get compensation. but they have h

we need to talk about iag. let's first talk about tui. trading down today.arket starting to price in a rights issue. you discussed that you think a rights issue is more likely than an asset sale. i am curious why you think that. there are good assets that could be sold. how deep of a discount do you think it would have to be from tui to make it worthwhile if they were to do a rights issue. mark: is a choice between worse and worse, between showing assets that have depreciated or writes on a stock that has clearly come down substantially. we heard from a company nervous about the pace of recovery as you hurting your comments about the share price performance. while tui makes a point about cash breakeven, as great as that sounds, it belies the pressure of this business and the broader sector going forward, particularly heading into a challenging winter, and we cannot see further -- more importantly, it is a winter where we would like to see consolidation. , as early to go early as early can be given the fact we are six-month into this crisis, get the money, go

and max confidence, iag agrees to buy boeing jets. would get on board one tomorrow. good morning, and welcome to "bloomberg markets." i am here for the ecb forum alongside anna edwards in london. anna: the picture looks a little clearer today, maybe that is central banking policy and the view behind you. but how are the markets? we are divided on the stoxx 600, not going anywhere fast as we wait for the fed. fairly evenly divided in terms of the spread of moves to the up and down some. -- still tronic moving higher, a little bit of a bounce and a positive note for morgan stanley on some businesses in the chip sector. cyb g up by 3.7%. 3.7%.g up by having a bit of a rebranding day. , another one to watch in the chip sector. let's have a look at the downside. we have got a food and drug retailing business in belgium down by 8.3%. the are guiding lower on business. this is a stock that has been in focus, down by 2.7%, as a result of the talk of rent controls in berlin. on them.aiting let's get a first word news update. may impose sanctio

, they are very profitable as pa rt context, they are very profitable as part of their parent group iagsfy customer needs to attract business in a competitive market they wouldn't be that strong. they have had to take on challenges because we as customers are looking more and more for good prices in our travels, also ba has to compete against low—cost carriers and equally have to compete at the top end of the market with premium customer brands like the airways and emirates. they have to invest in the premium product if it means we get lower prices at the bottom end by competitors, and we go to the competitors if ba doesn't offer them, they have to make sure they do the same thing and they have to look at their cost efficiencies they can do that without losing money. this strike starts tomorrow, 16 day strike. what is it about? as we heard, there was a strike or a series of strikes earlier in the year about pay and ba's mixed fleet, they said that a few years ago to deal with issues to make it more efficient in terms of cost levels for cabin crew and productivity and the union in fact a

at the paris airshow, the latest buzz has been about british airway‘s owner iag putting its faith inr iag putting its faith in boeing's troubled 737 max jet, despite it being grounded worldwide since two deadly crashes in the past year. 0ur correspondent theo leggettjoins us now from the paris air show. theo, talk us through exactly what ba and iag have been saying about this purchase and what the mood is about what they have done. well, it is hard to overestimate just how important this is for boeing. international airlines group has signed a letter of intent saying it wa nts to signed a letter of intent saying it wants to buy 200 737 aircraft. that is not the same as a firm order but it would be very surprising if it rowed back on that. iag is saying it has confidence that boeing can fix the 737 max and software fixes will ultimately work, make the aircraft com pletely ultimately work, make the aircraft completely safe and enable it to be sold for many years to come. for boeing, that is incredibly important, this is its flagship aircraft. it has a backlog of about 5,500 aircraft. a

the focus today was on iag.said that, it obviously came up on the call with willie walsh, and he made the point that they are relaxed about this. they are under no pressure. they are not putting any pressure on the irish government or anyone else. it seems like he wants to get a deal done, but at the same time, he wants it to be the right deal for iag. he is not afraid to walk away. he wants this to work for everybody. he is willing to be patient. guy: let's talk about air france. not such a good story. kari: no they are probably looking across the channel and wondering what they can take out of mr. walsh's notepad. it was better in terms of the lost it narrow but the productivity that they are seeing at iag, the productivity gains, are not coming through at air france. they are struggling with getting these different transformation plans and projects to stick. they went from the transform 2015 plan, to now the perform 2020 program. the management will be meeting with unions and staff members today to discuss im

i was chatting with the ceo of iag about improvement in spain, how they have and make amendments yet on their plan for spain but they are looking at doing so. something that willie walsh has never really shied away from. and if thehave means opportunity presents itself, then absolutely. ,> so you have spoken to iag lufthansa, anybody else you have been speaking to? >> some people are more chatty than others. i just chatted with tim clark, the ceo of emirates. bullish as ever. this is an airline that seems to be taking over the world. i asked about a potential -- he said that is an anathema to their model. of course, they have very ambitious plans but he doesn't keep them awake at night because they delivered on their plans and their ambitious targets in the past. they intend to keep on doing so. everyone just kind of milling around. we will be speaking with the head of air france later as well. qatar hasn't been as chatty. he just held a press conference alongside tony tyler. a lot of questions as well about potential tracking in the wake of the disappearance of the malaysian airline

iag, a good evening once again. _ still not released. iag, a good evening once again.d. iag, a good | evening once again. i associate still not released. iag, a good - evening once again. i associate my remarks _ evening once again. i associate my remarks of — evening once again. i associate my remarks of the jennyjust had to say, _ remarks of the jennyjust had to say, this— remarks of the jennyjust had to say, this is— remarks of the jennyjust had to say, this is a chess match —— i agree — say, this is a chess match —— i agree. hamas is calculating that if we let_ agree. hamas is calculating that if we let 2-3 — agree. hamas is calculating that if we let 2—3 go here and there, it will delay— we let 2—3 go here and there, it will delay the inevitable ground invasion— will delay the inevitable ground invasion of the gaza strip. in my heart _ invasion of the gaza strip. in my heart goes — invasion of the gaza strip. in my heart goes out not only to those who were murdered in this terrible attack, — were murdered in this terrible attack, but my heart also goes out for the

iag down 6%.s not possible to give an accurate full-year assessment because of the impact of the coronavirus, and they see weakness in demand. easyjet down 3%, seeing significant demand softening and planning to cancel routes. anna: the travel and leisure sector taking the brunt of the losses when it comes to market response and reaction, in european trading. hendersonn of investments is with us. we wonder what other asset classes might be vulnerable. one of my colleagues put out a story, calling it the scariest a chart this week talking about asian high-yield bonds. where are you concerned about positioning ahead of this market? nick: when you have really volatile markets, it has a beraing -- bearing on where you see the most pain. things like high-yield, u.s. equities would be another good example, seeing them losing pretty extended valuations. at a time you are worried about the impact of coronavirus, you think what is most expensive, not where i have the most profits to be taking. you can unde

a quiet day for earnings iag is boosting that index the dax is up almost .75%.ake a look at the ftse mib. up .75%. also taking a look at the ibex up over .50% bbva moves higher as the takeover saga continues moving the spanish index up .50%. take a look at the sectors we mentioned iag travel and leisure getting a boost. you see we are seeing utilities as the leader up over 1.5% right now. oil and gas is getting a boost oil prices are higher on middle east tensions as well as stronger than expected chinese data you see over here with autos which are down .25%. it is still a laggard today. it is weighed down by mercedes-benz. we see mercedes-benz shares continue to fall the ceo saying the fully electric transition will take longer than expected the previous target was 2030 autos is the laggard this morning. we moving on to u.s. futures is a mostly positive day in the united states. the dow would open up 100 points higher let's stick with the u.s the weekly jobless claims with 2 231,000 americans filing for unemployment benefits. continuing claims increased by 1.78

nners in if this is going to be tough for iag, do any of the rivals win out?ie: the airlines the gulfs family with, carriers, this could be a win for them. they have been squeezing the european carriers, and this could help them. as the u.k. sorts at what they are doing with the european single market, this could be a good time for the gulf carriers to squeeze them more. anna: with all the uncertainty at the moment in the u.k., it is difficult to imagine anyone approving of a runway at heathrow. it's hardly a priority. thank you very much. coming up, we are less than 90 minutes away from the open markets -- opening of markets in the middle east. we will discuss what to expect with franklin templeton's dino krohn phone next on "bloomberg markets: middle east." ♪ yousef: welcome back. you are watching "bloomberg markets: middle east." we are continuing our conversation. we are just over an hour until markets start to open across the gcc. we will look ahead to see what we might expect. we are joined by the chief investment officer for franklin templeton investmen

iag as well. difficult.ith their balance sheet right now. 2023 -- easyjet could be one of those as well. we need to see those numbers coming back in the industry. people like lufthansa and air france selling off bits of their fleet easily. guy: to your point about the legacy carriers out of continental europe, i am struggling to see where the acquirers come from. why would -- ryanair i cannot see michael o'leary being interested in anything other than organic growth. easyjet will see what johann does. iag, maybe. there does seem to be the lack of acquirers at strong companies. why don't they wait for the capacity to come out of the market and take advantage of it? luke: ryanair has quietly done a bit of m&a. it has not been a particularly successful acquisition. if an opportunity comes up they will not stand by and let it happen, especially if there happens to be a boeing fleet, which is what ryanair is through and through. it has grown into the 747 and they have big orders for the 747 max. if they can get s

iag is the most beat up on the news coming from ryan in. there is a read across to the iag. there may be some nervousness out there regarding iag and london heathrow. we don't know quite what is happening there. ryan air gets 26% of its revenues from the u.k. market so it is pretty good measure of what is happening in the u.k. this is all sterling related. we haven't heard about that demand picture which is likely to weigh further on figures. guy: how does it affect capacity? need we are not going to the capacity. theyu think in the winter, may take more capacity on than in previous years. ares: ryan air and easyjet both used to idling planes in the winter. there is only so much you can do. ryanair has said today -- we have indicated that we are not going to do that. we will cut capacity for the winter but no more than usual and therefore fares will be very low. come and fly with us. tearing down the opposition at the moment. we have huge capacity fares that are historically low but you are right, something may have to give if things carry on like this. up aoil prices pickin

this is iag. us, it will bed tough out there.ped some of the losses, but he is with our very own guy johnson in london at the aviation festival, about to have that conversation. take it away, guy. guy: thank you, manus. let's figure out exactly what is going on with the bin is. saidafter the brexit, you you had to reset your guidelines. the data coming out of the u.k. looks solid. did you jump too soon? >> we didn't. we have got a large sterling revenue profit base. we are now translating that with a much lower rate of exchange. we had a translation impact, which was immediate and could not be reversed. we had a transaction impact. the pound has weakened against the dollar. the euro has weakened against the dollar. we have seen softening of u.k. the productivity in the lead up to the vote, as corporate try to anticipate what that meant for them. these were three immediate issues we had recognized that could not be overcome in the short-term. migrating? > rate >> no, it is actually very different. historically, we can measure thin

iag came in with initial balance sheets. air france did not.ght the income and assets -- it hasn't. it had to go to the state and effectively allow the state to take control of business. francine: what are the chances that you say yes to this? guy: there is a high chance the eu says yes. we are probably going to have to change rules a little. euould be surprised if the ended up blocking this. two major airline groups in europe, close to collapse. if they collapse, thousands of jobs ultimately will go. jobs will probably have to go, despite government involvement. surprised if they decided to block. doesn't have the ability in the same way to stand up to be governments. berlin will force this one through. tom: events are moving through may, guy johnson, thank you so much, in london today. much more coming up. francine, what a treat. our extended conversation with governor king in this coming hour. tom, it will be interesting to see what he has to say on negative rates. thanks are breaking the possibility -- banks are breaking the possibility of

but arguably others like iag and job. but arguably others like iag a nd luftha nsa job. lufthansa have done better. air france and klm never integrated, there is mistrust. air france specifically has not restructured as much as it has to. and the chief executive resigned and the decision for the new leader will set the tone of how the talks carry on? that is what i would say. the chairman has the choice, a typical air france choice of bringing somebody new in every two years, or deciding for restructuring candidates, arguably to deal with the situation effectively that is fairto the situation effectively that is fair to the plough use you would need a leader to be there for almost a decade to solve this issue. —— deal with the situation effectively ina way deal with the situation effectively in a way that is fair to the employees. the likes of british airways and lufthansa have adapted to this new markets, why have air france not been able to do the same? iag, ba and lufthansa went through a series of bad strikes, at the time everybody said this is the wrong strategy, yo

let's see what it begins to cost iag.y morning, ongoing, although they are getting things back to normal. .att: let's talk u.k. politics as we get closer and closer, polls in the u.k. are tighter ahead of the election. it could mean a period of turbulence for the pound sterling. it's recovering some of its losses this morning after a fall on friday, showing the conservative lead over labor has narrowed. last week was the worst week for the currency this year. stay with us -- still with us, vincent -- does this narrowing of the polls give you pause? what do you expect for the pound going forward, other than uncertainty and volatility? >> well, we are sure of the pound at the moment. this gives us an idea of what we expect, as long as the holes in the election gives victory to the conservative party. that's the most likely outcome going forward. obviously ag-term, strong conservative property means a hard brexit, which is something that in the midterm could weigh on the pound. that brexit ise a huge frustration in europe. w

britishe looking at airways owner iag. it is having its best day since december., at one point it was surpassing 6.5%. it is hovering just over 5%. the company has taken off restrictions on non-e.u. ownership. it will be the best performer today on stoxx 600. 5% on theore than ftse 100. let's take a chart at the iag freezing situation. today is the best day since december. the stock climbed 47% in six months. there are issues they had to strike including a pilot and surpassing a record data breach fine. there is an uptick in revenue, ridership. writer -- this chart we will stay on right here because it has to do with the top iag holders. that requirement for non-e.u. ownership is just below 50%. today it came in at 39.5%. the biggest airline owner is cut airways. we will leave you with just this. one word for you, brexit especially as it could pertain to a risk in ownership. guy: thank you very much. what we have coming up for you. the battle of the charts. that is next. this is bloomberg. ♪ bloombergme for the business flash. bloomberg has learned a canadian bill