this is "bloomberg surveillance," jonathan ferro and tom keene. ♪ jonathan: good morning, this is ambloombergnce," i jonathan ferro alongside tom keene. good morning vonnie quinn. vonnie: good morning. macau is down. that is the 18th straight decline now. stakes keeping high gamblers at home. morgan stanley is calling 2016 the year of the yen. they say it will outshine the dollar in the foreign exchange unit. they say the yen will weaken more next year. the chinese consortium gets its foot in the door of british soccer. paying for a 30% stake in the holding company that owns manchester city. city years ago and has won two titles and is tied for first place this season. whoyou a man city or a man fan? italian and dad was i was born in the 1980's. i want to find out the manchester city equivalent in the nfl. who is a really bad team? tom: like the boston red sox? they come in and plug loads of money, and then before you know it, they are the best team in the league. [laughter] maratheftis is here with us, he has fabulous experience in the middle east. for years, you have watched the ups and dow

we believe that there and be back with jonathan ferro a little bit later on.e speaking with the swiss national bank president shortly. we will have that on later in the morning. did not miss that. central banking is critical right now. daniel morris from bnp paribas is still with us. andvalued currencies undervalued currencies. how big a guide is that in had you make investment decisions? daniel: it will certainly be a big part. this goes back to when we think about emerging markets. we need to be at a point where isthink the potential gain going to offset whatever depreciation you get. that has not been the case so far. my think in 2016 we will see a turnaround because the potential is there they are going to turn around, we believe, and when they do, he will get a pickup to offset the currency. i have south africa, turkey, brazil. i have all of these currencies that have been crunched hard. i am looking at the world through the prism and that is one of the key metrics by which i make investment decisions. it is a really tough place to invest right now. danie

i am guy johnson alongside jonathan ferro. jonathan: it is to count down to the fed. u.s.begins its two-day meeting. the world's most highly anticipated rate decision comes tomorrow. executive --esed chief executive says a rate hike could be the tipping point for some of its rivals. of era

tom: jonathan ferro, thank you.ernational ramifications of what the central bank or the world does. tom michaud knows who the central bank are of the world is. you really need janet yellen to normalize your banking world to summer 16, right? >> absolutely. for the banking industry, it was not built to do well with zero interest rates. i think the big point of what the fed will do next week is not that they are moving away from an accommodative policy, they're just removing emergency measures that have been in place for probably too long. tom: why are we struggling with this? >> mainly i think because we haven't been raising rates and is new.s, so it to get in normal or something that is not accommodative, you probably have to move more than once. francine: tom, you are expecting -- this is the point, tom, we have been talking about, is that so we get december 16 out of the way and then we have to get to a comfortable place for the markets to understand what the fed does next year. is it going to be gradual and is th

i am jonathan ferro here in the city of london. you up to speed to what stocks are trading this morning. the ftse 100 in the green. we traded 26 points higher. the dax higher by .6%. the stoxx 600 at this point heading toward a third week of gains. switch up the boards. we will whip up through the fx market. 1.068.o trading at the dollar index is pushing higher, retreated from that 2015 hike yesterday as brent crude, $44 a barrel. ahead of that opec decision on friday. let's get to individual stock stories with caroline hyde. caroline: it is all in the name, green king is in the green. we're talking hubs. -- profitspumps surge with the acquisition of the spirit pub. adding total revenue up 50%. pretax profit up. dig into the polite sales. they look pretty strong. up 2%. cost synergies are going to be better than expected. talkingd, we are payment processing up 4%. the reason is once again it looks as though the earnings forecast is looking prettily -- looking pretty stellar. many analysts saying we get to have more upgrades to come

i am jonathan ferro. 30 minutes into the trading day. see how the market is shed -- let's see how the market is shaping up. .4%.tse 100 up by the bank leading the gains. dax lower.the nejra: bank's are leading the gains, both on the ftse 100 and european stocks. i highlighted lloyds in barclays. -- lloyds and barclays. rbs, standard chartered, all rallying. all seven of uk's major banks past the stress tests. standard chartered and rbs fell short in some parts of the assessment. those banks are rallying today. it is theto linde, worst performer on the stoxx 600 this morning. job the most in seven years. -- dropped the most in the seven years. this is less about that and more about the ceo reducing the earnings target for the third time in just one year. this company has been facing challenges because of lower oil prices, a slowdown in industrial output. a lot of that down to china. a lot of that because of cuts in medicare spending in u.s. which means less demand for some of its products. the worst performer on the stoxx 600. jonathan: n

i am jonathan ferro in for francine lacqua this morning. the ftse 100 lower.s weighing that index this morning. china's exports fell for a fifth months and november and a slump in imports extended to 13 months leaving a surplus of $54 billion. the slowdown means china's industrial plants need less iron ore and coal. a nobel laureates says europe's economic prospects is worsening. a severe danger that the european union could buckle under the pressure of the refugee crisis. has received a shot and the arm after revised gdp data shows that japan avoided recession and the last quarter. the economy grew 1% through september rather than shrinking 0.8%. now to bloomberg first word. for more on these stories had to the bloomberg terminal and bloomberg.com. jonathan: saudi arabia continues to increase production. opec fails to increase supply. who better to speak to about learning from the at than the mn who ran bp. i want to welcome him in. lorde brown. he's written a new book called "connect." through therunning energy sector right now. but we are going to start wit

i'm guy johnson alongside jonathan ferro. jonathan: i am reliably informed that now it is the federal reserve's turn. global rebound. stocks climb in the dollar rallies ahead of what could be the first rate hike since 2006. lift.s. congress is set to a 40-year-old ban on crude exports as oil trades and 87 year low. guy: it's a big day. we have a lot to talk about. let's get you up to speed with the bloomberg first word news. .aroline: thank you asian stocks are trading higher ahead of the crucial rate decision. they are downplaying concerns over oil and high-yield bonds wil. hang seng snapped his longest losing streak since 1984 stop . congressional leaders agreed on a fiscal plan that will lift the ban on crude exports. paul ryan unveiled the plan that will also avert the government shutdown. party arekel's expecting growing dismay at the prospect of a british exit for the eu. leaders are preparing to discuss their call for reform at us on it in brussels tomorrow. when german lawmakers as the referendum over eu membership is

i am guy johnson alongside jonathan ferro. jonathan: it is to count down to the fed. u.s. century bank begins its two-day meeting. the world's most highly anticipated rate decision comes tomorrow. executive --esed chief executive says a rate hike could be the tipping point for some of its rivals. of easing money coming to an end. the rout continues. guy: we will be answering that question throughout the show. the two to bloomberg's first word news. caroline: the eye and or collapse has put subsidies to the brink of survival. chief a state says many are hanging on by their fingernails. i and or fell below $38 per metric last week. below $38 perl metric last week. of $30, it won't physically work. from the $30 you to take by those trailer if you are shipping from australia. $15 trade if you are shipping from brazil. about an fabg price of 25 from australia. there is a lot of high-cost not going tot are pass at that sort of price range. it is not sustainable. it is fantasyland at that level. australia's -- weaker global and the mystic growth. scott morrison says this financia

and jonathan ferro, thank you for being with us from london.ppenheimer is staying with us. we will be right back here on go. stephanie: welcome back. you are watching bloomberg go. we are breaking down the ecb rate cut decision. at wheree a quick look stocks in the u.s. have opened for trading. matt: most important right now is the euro. we are looking at -- we almost touched $1.09. it got there like a half hour ago. that is because of mario draghi -- you could see it as a disappointment if you expected him to expand his qe program. just a huge jump. the germans also putting on 15 basis points in the span of two hours. this is an insane chart. 0.46 in theing at negative before this decision came out. now 0.3224. take a look at european stocks. stephanie calls this profit-taking. a lot of people would say they got crushed. the stoxx 600 down 2.5%. the dax down almost 3%. the ftse down 1.5%. just an amazing move on this. mario draghi disappointment. maybe he is succeeding. read it how you like. obviously the big picture looks a lot better than th

i am guy johnson along with jonathan ferro. jonathan: bloomberg's commodity low.onth miners, bracing for more pain. anglo american drops to an all-time low. will he need to cut the dividend? china's trade slumps. for a fifth straight month while imports are off for a record 13th. guy: let'sguy: check out what the first news looks like with near a. has received as shot in the arm after gdp data showed japan avoided recession. the economy grew 1%. pimco is going for heavyweight names in an effort to reassure its clients. the company has announced former fed chief ben bernanke, gordon brown, and former ecb president john claude tree shea will be part of a new global advisory board. deaton sayste angus europe's economic prospects are worsening as it struggles to absorb a wave of asylum-seekers. the winner of this year's nobel economics prize says there is danger the eu could buckle under the pressure of the refugee crisis. for more on these stories and others, head to the terminal and bloomberg.com. guy: let me tell you how we are looking at the open this morning . fa

jonathan ferro will take us from there. me, look to the chinese manufacturing numbers.cturing numbers. the miners will be looking at the manufacturing numbers. ae pmi number in china is at three year low. i will be speaking to a man who knows a fair bit about mining, tom companies. -- tom albanese. coming up in 36 minutes, a man who thinks euro will be stronger. will bevid bloom, i speaking to him later in the program. anna: john, thank you very much. the european markets will be a little stronger. guy: let's quickly show you. london is outperforming continental markets envelope and 2/10 of 1% higher. we will walk you through the numbers as we get them. anna: see you tomorrow, everybody. ♪ jonathan: good morning and move." to "on the i am jonathan ferro and we are moments away from the start of european trading. the bank of england said all seven major uk banks passed the stress test. the chinese manufacturing hits a three year low. the mining sector suffers. we speak exclusively to the ceo on this program. the dollar index retreats for the first time in five days. watc

jonathan ferro alongside guy johnson this morning. guy: i would argue, not much happening here.eason for that is fairly obvious. in some ways, a lot has already happened. yellen spoke overnight. that is a big market story. oil is on the move as well. on a normal day, i am not sure you would see a market doing as little as what we are saying. jonathan: it is kind of eight nothina nothing move in stocks. we will have a look at the euro. 1506.just south of we are virtually there, aren't we guy? have enacted the benefit, maybe not the benefit, but the story on that one is in the market. again, we come back to the question. to getes he need to do this economy going? to get inflation moving in the right direction? up 1.2%.e is we don't a what is happening with commodities. let's get some individual stock movements with caroline hyde. caroline: they are feeding in from other asset classes. mining stocks are under pressure this morning. this concern is about global growth. are we ready for the united states to step back from stimulus and push rates a bit higher? bhp is one of the worst

the rio tinto ceo spoke to jonathan ferro in an exclusive interview.et's continue the conversation on commodities with the investment director at london and capital. you say it will get worse from here. if you think about the reduction in the capital spending cycle we have seen, we have only barely started. we have capital spending down by 35% from peak levels and we are still putting in new capital to create new capacity. something very similar is happening to a number of commodities and iron ore. you will have increasing supply for the next few years and the demand will have an input of commodity resources to china, going relatively stable. that means access continues to build with tremendous downward pressure. what we are seeing right now is a downward cycle for number of miners. francine: what i am trying the euro is the systemic risk and there must come a point when the said normalizes and you have too much supply. all these companies will have to go bust. >> it will go through a phase of consolidation which is inevitable simply because they are n

commodities markets are still searching for a bottom, according to a ceo speaking to jonathan ferro. oducers are battling with oversupply and waning chinese demand. let's listen in. >ok. this is one of those classic tv moments. jonathan: the voice comes in your ear and says we don't have the sound -- go long. i spoke to him -- markets are still searching for a bottom in commodity markets, three reasons. china, rates, production. you don't have a seat on the pboc our fomc -- the only thing you can control is production. that is one of the reasons the commodity markets is still searching for a bottom. manus: there is that integral issue, the policy -- look what opec are doing. as much iron ore as you can pilfer. the policy is to -- jonathan: exactly, and that is not happening. that's where the echo of the energy markets are so loud, because the opec-like reduction strategy is quite clearly taking part in the market as well. the big players are carrying on pumping production, the low-cost producers trying to flush out the high-cost producers. but the bottom line -- he said this to me --

i am guy johnson, alongside jonathan ferro. it is fed -- jonathan: it is fed week. economists expect yellen to hike rates for the first time since 2006. commodity contagion. -- bearish bets climb to an all-time high. the zoom you turn to the south african president names his second financial minister in four days. guy, what a move. .uy: he was pushed into it he was going to have to do something. quite a u-turn. a lot of internal politics going on within the asc. let's did you up-to-date with everything you need to know. here is caroline hyde. caroline: the rbs achieve a of saying the restructuring of the bank is going well advanced. returning to profit within four years. he's coutu manus cranny and an exclusive interview. quest the work in -- >> the work in the bank will be done by the end of this year. the restructuring of the front end will pretty much be done right end of this year. which is a very, very good outcome. caroline: there has been a rant rebound after jacob zuma named his second finance minister in four days. the man who is the held the post between 2

i'm jonathan ferro, in for francine lacqua.

jonathan ferro spoke to -- that's all coming up. let's get more on argentina.eat story, too good a story not to talk about. the country's new president gets inaugurated, but the ceremony doesn't like drama. the former president is refusing to attend. a group of lawmakers will also boycott the event. let's get more on argentina and the challenges the new president will have. our executive editor or international development joins us now. i love this story because it plays out like a tele-novella. the president is not going near him. they had to elect an interim president for 12 hours. >> we are in a pretty remarkable situation. right now, argentina has an interim president. level,his -- on one there was heavy squabble between the former president and the president-elect, but on the other hand, if you look at what lies behind us, what you are seeing is a pretty fundamental battle between to alter personalities. saying i amident is in charge, but fernandez, watching is doing here, even though it looks like a drama, she says she's not going anywhere. she is still g

i'm guy johnson alongside jonathan ferro. reliably informed that now it is the federal reserve's turn. global rebound. stocks climb in the dollar rallies ahead of what could be the first rate hike since 2006. lift.s. congress is set to a 40-year-old ban on crude exports as oil trades and 87 year low. guy: it's a big day. wve

i am guy johnson, alongside jonathan ferro. it is fed -- jonathan: it is fed week.ellen to hike rates for the first time since 2006. commodity contagion. -- bearish bets climb to an all-time high. the zoom you turn to the south african president names his second financial minister in four days. guy, what a move. guy: he was pushed into it

i am jonathan ferro. guy: i am guy johnson. e are moments away from the start of the european trading. draghi decides how far will the ecb go to boost inflation. investors prepare for more stimulus. we march toward the first rate hike of 2006. oil gains after a report that the saudi's may be ready to reduce output. speculation ahead of opec. the central banks have dominated for such a long time. draghi is going to deliver what many people have expected a while. another bazooka. another story of excess liquidity thing pushed into a market struggling to absorb that. jonathan: i said the same thing last hour. if i told you 12 months ago, only the synnex would agree with s wouldnly the sinic agree with me. we will debate this ahead of the ecb decision. should we go to caroline hyde for a little bit of a guide ahead of the open? caroline: we are expecting stocks to be down today. it is central bank divergence. that is on the agenda this morning. we are expecting a bit of a follow-up from the stocks being down yesterday. today we have

is the move" with jon ferro here now -- he will tell us what he's watching. jonathan: good morning.esterday meeting or something, the euro spiking, bonds plunging. draghi disappointed as the headline in the market. that depends who you are. if you are janet yellen, that door for a rate hike just got a whole lot lighter. we will discuss u.s. payrolls and jobs data ahead of the market session. we will also be talking about mario draghi, who also speaks in new york later today. do not miss that conversation. beyond that, we will talk opec, crude volatility, vienna volatility -- call it what you will. $45 crude, whatever it might be, producers brace for low prices for longer. anna: it was interesting how janet yellen was asked about the ecb and her excellent -- it was short, it was concise. i thought i sensed a smile. thank you very much. just had to tell you what's going to have been at the start of the european equity trading day. futures will be down, but not by yesterday's standards. we are down by around 2/10 of 1% across the european equity markets. ♪ jonathan: good morning and we

i am guy johnson along with jonathan ferro. jon: straight to the commodity market this morning.e trying to get in front of the fed. guy: let's go to caroline hyde. caroline: dow chemical is in late stage talks to merge with dupont, according to people with knowledge of the matter. an agreement could be announced as soon as this week. 1.2%, importswn also dropped by 3.4%. the white house says that donald trump has disqualified himself from the presidency. he said muslims should be barred from entering the u.s.. trump is refusing to back away from his comments despite universal condemnation. less than half an hour to go until the european open. let me tell you what we think will be a story today. if you look at the fair value calculations, euro stocks up by 0.3%, cac 40 up by 0.4%. the dax up by a run 0.3%. you are looking at the futures. it looks like europe will stabilize. that is probably the best case scenario. jon: stabilization is the opposite -- operative word. brent crude, you have the chart up. you were watching with $40 and we dropped below $40 for the first time since f

we spoke with jonathan ferro and guy johnson about the challenges in this new low price and barbara.> the low price of oil is a challenge for oil-producing countries the world over, not just for scotland or the u.k.. first and foremost, we are working to support the industry as it seeks to increase efficiency, lower the cost of production, and we are remaining focused on on making sure we don't see early decommissioning in the north sea. francine: scotland is externally exposed to the price of oil in the north sea. ,iscussing those falling prices george magnus and stewart. when you look at oil, how difficult or how impossible is it to predict where goes next? >> it is very difficult. the one thing i would say, and we have priced the better stories out there so hopefully this has been priced in. the resurgence in iraq has been weston. -- priced in. with theened in rome libyan talks. it is early days, there is a long way to go, but i would pointing out that there are a million dollars of assets. if they can organize them themselves and have a efficient exports, that would be the next s

the jonathan ferro here in city of london. moments away from the start of european trading.tion dilemma. is it -- is it too little too late to get the boost test to get the bank to boost stimulus? a military dimension. today's report could reveal a crucial hurdle to sanctions relief. volkswagen's majority breaks the silence. they place employers for the first time since the end that's since the emissions -- since the emissions scandal. 20 seconds away from the open. futures up a little bit higher. caroline hyde, how is your market open? caroline: central banks front and center. yesterday, manufacturing data in the united states sent a shiver down european investor's spines. is u.s. economy strong enough to sustain the first rate hike in a decade? today we seem more optimistic. we are getting over the manufacturing words. today, money just flowing into equities cautiously. the 100 up .1%. we are expecting the ecb tomorrow. will they add to the stimulus. 100% of the economists we spoke , we will see more stimulus coming from the ecb tomorrow. inflation data set to be poor late

i'm jonathan ferro. guy: acuity facelift.an calls for longer maturity bonds and etf. corona stops short of an increase. china decay. as chinese prices steadily rise, they warned of disturbing deterioration. and crew to smack down. every time oil creeps higher it gets struck down again. we leave the week with sub $35 wti. 30 minutes ahead of the open, a bit of a rally. futures are a little bit lower, ftse down by 26 points. let's get to nejra cehic for your first word. nejra: thanks, jon. the bank of japan capped its main monetary stimulus target unchanged and expanded the program to include longer maturity bond and real estate investment trusts. the other stronger against the dollar this morning. a private survey of the chinese economy shows disturbing deterioration across the board. shows outputk prices, hiring, borrowing in capital expenditure were all weaker. toid cameron says his bid change britain's relationship with the eu is gathering momentum. eu leaders are signaling they are willing to find compromises on his demand

subdued wage growth and oil would keep the controls -- jonathan ferro spoke to the president. is no necessity to change monetary policy at the moment. rates and the willingness to intervene if necessary. >> these are two central banks facing two completely different challenges. thomas jordan is in a currency war with mario draghi. the bank of england is facing a problem, the same problem as the u.s. they don't know when inflation will reappear. there is movement and oil. when you look at core, core is still 1%. if we cannot find that inflation, we cannot create it. oil prices and wages have to affect you --kenny: they should be flying with us. -- prices stephanie: they have to affect your business. kenny: of course they do. , there is a big part putur economy that airplanes together in this country and is one of our grandest exports. david: are you seeing wage pressure? kenny: in our business, no. we are not dealing with entry-level folk. in theive oem's world that make private airplanes. they had that under control. >> economists have always had you strip out oil and fruit pr

jon ferro is noting west texas intermediate off the bloomberg terminal, nicely under $43 a barrel. pg&e ceo on utilities. stay with us. ♪ jonathanning, this is bloomberg "surveillance." good morning to wall street, good afternoon to hong kong. i'm over in new york. let's get to the bloomberg business flash. >> good morning, everyone. fedex says it is unable to contact two of its securities, as the turmoil in a brokerage investigation over possible links to china's stock market ralout in august. the media reports suggest that they may have been taken away by authorities to assist with an inquiry. foreign investors are pulling money out of turkey, and the record outflows are expected to continue. billion, estimate $7.6 including $1.4 billion last month alone. among the factors threatening turkey $720 billion economy include war in syria and russian sanctions. the new ceo of barclays is considering deeper cuts to the bank's security unit. they say he is considering eliminating another 20% of the bankers, in addition to an existing program to reduce staff at the investment bank by 7000 through 2016. that is a bloomberg business flas