joining us is jeff currie.irst what your reaction was when you saw that wti contract going negative. is this something we have to get use to and will be recurring? jeffrey: i think it is important to distinguish between the fundamental story here. we will see it likely reoccurring, versus the positioning story that made this one exceptionally extreme. the fundamental story, this is a well flagged event we saw negative prices in the midcontinent u.s. before this. brent is a waterborne crude. we don't think it can happen in a waterborne crude because you can get ships in and out. in a landlocked crude like wti versus france which is 500 readers from the water, is susceptible to the situation that is likely to breach storage capacity. once it reaches that capacity, you cannot move anymore and as a result, if you can get an environment where producers are willing to take their oil away, that is where a negative price -- what a negative price means. the positioning story, because we had seen this in 2009, if you go

jeff curry, global head of commodities of goldman sachs.ntog up, we will dig china pmi's, rising into expansionary territory while the rest of -- rest of asia goes toward a steep decline. ♪ manus: this is "bloomberg daybreak: europe." i manus cranny into by. nejra cehic is in london covering the morning show. we have asian stocks giving a little bit that, asian pmi's were again in expansionary territory but it's about a belief in recovery in china. you have to get the global health crisis under control before these markets recover. another route is potentially imminent. dividend annihilation, hsbc and standard charter and a concern about dividends across the european trading day you take a look at the tenure government bond yield prevent will there be a deal done between russia, saudi arabia, and the united states of america? let's get to our guest host, noel o'halloran. great to have you back. jim rogers saying the worst air market will come in the next couple of years. there's a risk of another imminent route. do you agree? noel: i certai

jeff currie will be here to explain what this means. how alarmed you should be, if you should

our colleague alix steel sat down with jeff currie of goldman sachs to talk about what is going on inil market. is going to hit storage capacity constraints and test capacities. when they do that, once you hit those capacity limits, supply has equal demand no matter what. that is when you see the really large production cuts happen. it will not likely be in the past numbers, but is likely coming in the next two to three weeks. what is happening at cushing will become more of the global phenomenon. i'm not arguing you will see the same price volatility you saw in wti last week in brent and the other markets. i think the key message is we are not out of the woods yet. this inflection phase we are in will likely last three to four weeks in oil, at which point, when you get to june, the market may be in a deficit. remember you're are shutting the supply down. demand is improving. peak lockdown is passing. a deficit market will likely be reborn sometime in the late spring and early summer. it is still too early to buy. how: before we get there, much volatility in spikes to the downside do

jeff currie of goldman sachs, thanks very much.to take a look at how retail investors are actually hurting from the oil slump. the bank of china estimates its clients lost more than $1 billion on oil bets. bloomberg has learned the bank has been compiling reports for 10,000 outlets. over 60,000 customers are said to have invested in a vehicle linked to wti. those contracts hadn't rolled yet, meaning they were selling and then buying june contracts the day before they expired. something the etf in the u.s. did not do. we want to get updates on headlines outside the business world. viviana hurtado is here with headlines. viviana: may 15 is the date new york could begin reopening. it starts with construction and manufacturing. it would probably begin upstate before moving down to the new york city area. reporting the state 360 seven deaths, the lowest in almost a month. over to the u.k. that is where british prime minister boris johnson is back at work today. the last couple of weeks, johnson recovering from the coronavirus. in his fi

when it comes to the storage capacity, jeff curry says it could be three to four weeks.here do you want to go? do you believe the rally in the s&p 500? forward earnings are high valuations? -- or high valuations? nejra: hsbc has set aside the most capital in almost nine years to bad debt as the coronavirus outbreak royalty economies of its main markets. expected credit losses swelled to $3 billion in the first quarter, almost double estimates. europe's biggest lender has already stopped its dividend falling regular -- following regulatory pressure for companies to preserve capital and pause efforts to cut 30,000 jobs. joining us is ewen stevenson, cfo of hsbc. we've got lots to discuss, but let's start with the credit losses. 2020 credit losses could swell to seven to $11 billion. how robust is the guidance at the moment given the uncertainty around how bad the impact of coronavirus could be? a resolve the us we a great degree of uncertainty around the range. we saw $3 billion of expected credit losses in the first fourfold on last year. the seven to 11 range is an estim

jeff currie will be here to explain what this means. how alarmed you should be, if you should be alarm and what's next for oil stocks kiging off in the red there's more than 750 cases -- 5 750,000, i beg your par doon we'll talk about that and more as we kick off this hour >>> we kick it off with the markets in terms of stocks holding steady as energy is in a free fall. it's the story of the day. it will be the story of this hour let's get to bob with the set up for these markets. bob. >> the important thing is we are well off of the lows. industrials weak consumer staples are weak. we're not getting any bounce at all from those defensive plays that done so well for us in the last several weeks like proctor, coca-cola. not much energy there today. one good piece of news, the banks after a rather rough week, the etf bouncing about 6% from its high to low. the key regional banks are trading up most of them were trading to the down side. finally, just on oil, had a lot of inquiries about uso and all these oil efts want to remind every one

. >> jeff currie said yesterday he thinks the peak week globally is last week and that by june you couldtart to be in a deficit situation again. would you also say that's possible but would get worse before it gets better or do you have a different view? >> no. we were watching moerkt data because it's so up to date the staggering one is india down 80% in terms of mobility i was surprised that there's not been more of an uptick in spain and italy. they have opened up slightly but the trends are extremely negative there's no sign of the uptick that you read about when you read that they were opening up slightly. >> wow which doesn't bode well for here for people being eager to get out and go that said, you have a pretty bullish view on demand for crude in the back half of the year because prices are so low. the december contract trading around $32 is that a world that you think is going to be a reality again, people need to know there is not a constant discounting experience it has to clear at these ridiculous levels before we can get to $32 a barrel and does 32 seem doable for you? if so

global head of commodity research, jeff curry spoke to bloomberg earlier. >> over the next three to fours going to hit storage capacity constraints and really test those capacities. once they do that, once you hit those limits, supply has to equal demand, no matter what. that is see the large production cuts happening. next likely coming in the two to three weeks. much ofing to become the larger global phenomenon. saw inolatility that you wti last week. the key message is we are not out of the woods yet. this inflection phase we are in ,ight last three to four weeks at which point, when you get to june, this market might be in a deficit. you are shutting that supply down. peak lockdown was a few weeks ago. a deficit market will be reborn sometime in the late rain or early summer, -- spring or early summer. shery: how much volatility do you fact? violentll be a rebalancing process. look at today. we are heading back down again. system bumps up against transportation, processing or storage capacity constraints, these prices spiked to the downside to take that supply out of the market. vola

goodnk jeff currie made a point speaking to tom and francine, that if the fundamentals don't change, we could potentially see negative prices again on wti. storage is exhausted. he said we could see storage around the globe hit. we see a lot of creativity going on in the oil market in terms of being able to get your hands on this storage. off the coast of california, about 20 million barrels of oil laying idle in what is now floating storage. another thing happening in the market, you're seeing this had everyone, not just the industry, but also retail investors. america -- monday, when this contract expired, those prices came under zero, so a lot of money for the retail .nvestors a harbinger for big oil. alix: thank you very much. one other story i am watching this morning's credit suisse, kicking off earnings season for europe's biggest bank and taking an upfront hit from the virus. the lenders taking more than $1 billion in write-downs and provisions for bad loans. credit suisse says it may have to make further allowances in the future. ceo thomasnew gottstein. >> i did not expect

this morning jeff curry has a note out one line is we entered the inflection phase where rebalancingas started. could take four to eight weeks, they think, but given the nascent recoveries in europe, does that make sense at least? for ag, they see the window longer but for oil, that's it >> rusty braziel said how you can get to minus 37, but i think there will be rebalancing. notice freeport cut its production for copper. i've been waiting to see someone cut back as companies cut back, at least we have some support for commodity pricing and we would be less worried about deflation, which is something i'm worried about. we have pumped so much money, prices are still coming down it's amazing >> you know, that's interesting that you say deflation if you read the elliott note, if you got through it from last week without wanting to just, well, you know, not be around anymore, they still are concerned that currencies and inflation could come at any moment, and people could lose confidence not so much about deflation. >> in germany it was deflation, deflation, deflation, then one day it wa

jeff. happy to be working but yes. >>> well, sheltering at home. how about jimmy g. style? where we saw the 49ers quarterback. >>> happening now, fire crews are at a house fire in south san jose at curry and manila not far from bern hoelt middle school. a mother, father, and two kids inside at the time. we're told they made it out safely. no word on what started it. but we are back with more news after this. you may not be thinking about blood donation, but blood is needed to save the lives of people who are sick with a range of illnesses. it's easy and safe to give. if you are in good health, please donate. we need heroes now. visit red cross blood dot org to schedule an appointment. >>> okay. this is interesting. major league baseball players and staff members are now taking part in a covid-19 study. >> yeah, the athletics first reported that 27 teams including the a's and giants are taking part in a study that's looking for antibodies. it's conducted by stanford researchers and it tests for a blood protein that the body creates in response to the virus. now, players, families, coaches, staff, even the concession workers and ushers are among those participating. in all, jessica, 10,