lagarde: not now. we are still forcefully delivering under these exceptional circumstances using exceptional tools, which is the pandemic emergency program, which i expect to last at least until march, and possibly transition into a new format after march. that is what we see at the moment, but i think we need to be very flexible and not start, you know, creating the anticipation that the exit is in the next two weeks. manus: the ecb president, christine lagarde. we will have more of that exclusive conversation throughout the show and morning. our guest this morning is jane foley. something for everyone, but more for the doves. all in. we mustn't create the anticipation of emergency tools are near an end. why such a muted response from the euro this morning when madame lagarde says she hopes to deliver clearer, simpler and crisper guidance? why such a phlegmatic response? jane: i suppose simpler communication would be welcome but the actual met -- actual message hasn't changed that much. they've change

lagarde: not now.ow we are still forcefully delivering under these exceptional circumstances using exceptional tools which is the pandemic emergency purchase program, which i expect to last at least until march. alix: that was ecb president christine lagarde speaking to bloomberg's francine lacqua. want to bring in hsbc's chief economist. the fed continues to see a stronger economy. the market is pricing in a potential paper. but the market is not moving. have we already priced in the divergence? >> i think the market is questioning how much more dovish you can get. at the margin, there are things the ecb could do. they could try to push further out in time the expectation in the market for future rate hikes. that is probably what i expect to happen starting maybe from july. at the margin, you can get a little more dovish, but they are already buying a lot of bonds and sovereign bonds in particular, so i think the market is the question of can you actually get that much more dovish. christine lagarde s

is that what emboldens lagarde? >> it does.ns that they are far from reaching that target. in their own logic, if they remain consistent, they would have to do more. lagarde said, we have to be participant -- persistent. they will have to run the current for even longer. if they are really consistent, they have to step up qe. manus: you say that forward guidance -- to me, it's all about, you said it's fake. how could forward guidance be improved upon to add to the dovish narrative? carsten: in all honesty, it's an ancient concept. it doesn't work. we see that currently with the fed. how could it work with the ecb? saying that we will prolong our program beyond march 2022. the ecb will make sure that asset purchases in 2022 will at least last until we've got broad inflation at the target. manus: this is about the morphing of pandemic bond buying and the asset purchase program. the consensus in the market is that they will demonstrate the ability to raise the capacity of asset purchases while fading out the emergency. is that the

lagarde is promising a celebration of the tools.e review, one from which they were expecting much at all because it's the summer. i, for one, think the ecb should have targeting in the revamp considering the euro area, i think completely underwhelming, several years after the adoption of negative interest rates. that will send a strong message to the markets. they failed in sending that message across. next week's policy meeting gives the ecb another chance ethical. let's see whether -- at the goal. let's see whether this goes around. anna: the review and what we hear about anna terry policy in the next meeting -- about monetary policy in the next meeting. another important data point for us then, ven. ven: absolutely. i think the markets embraced fed chair powell's mantra. you look at the five and 10 year inflation rates, which is positive, meaning the markets aren't really concerned about runaway inflation beyond the intermediate-term. the cbi ntp or principal is greater significance. it was already elevated at 5%, and economists

lagarde: thank you so much.l as i could the forward guidance on ecb interest rates and the fact it is taking into consideration three key criteria over the space of time in order to make sure we have solid and lasting elements that will actually be useful to guide our actions. i would not say it is lower for longer. i would say it is an indication that none of us would want to tighten prematurely. i think we are performed by past experience and most recent history. this element of patients you have between -- this element of patience you have between the midpoint and the horizon and that it has to not only be early and way ahead, but also lasting, is precisely intended to avoid premature tightening that would be detrimental for the economy. i think the combination of patience in order to gain confidence is what we discussed and what we tried to embed in the sentence. on the rest, essentially, i would summarize it by steady hand. the use of instruments such as pepp has been steady hands. we conducted the joint as

sophie: that was ecb president christine lagarde -- kathleen: that was ecb president christine lagarde. we have other big news, we forgive you if you did not see the top of our show, italy winning the euro championship, eating england -- beating england 3-2. let's look at the pound, because boris johnson has put a lot of hope in a win. the first time for the u.k. and 55 years. instead, a heartbreaking loss when you see your team losing and penalties. the pound pretty much unchanged, a little lower. we want to harken to the important remarks made by christine lagarde. the euro a little weaker against the dollar. she seems to be signaling perhaps more stimulus is coming, no hurry to start removing it. in terms of stocks, the s&p 500 with a big day, record high after three weeks of gains. maybe optimism continues, covid variants might be spreading but there is hope. last year, snapping a two-week rally, 1.36%. just under that level now. it is interesting to see how that shapes up in asian markets. haidi: we could see a bit of a lift not just from what we saw in the u.s., wall street overn

shery: warnings from christine lagarde that the ecb will not tighten early. haidi: the big day is finally here. the lippy opening ceremony hours away -- the olympic opening ceremony hours away. shery: it is a picture across wall street. nursing u.s. futures rising a quarter -- we are seeing u.s. futures rising a quarter of a percent. a record for a third consecutive session. we have the old playbook resurfaced. the cyclicals rally we saw in the past two days coming to an end. the 10 year yield falling. treasuries rallying. the dollar not moving that much. we are watching the euro given that it has failed to hold onto those gains after the ecb meeting and the revisions to the right guidance. wti losing 2/10 of 1%. this after rallying in the new york session. there has been more optimism about the recovery only here in the u.s. but broader globally . take a look at this chart on the bloomberg. i want to talk about the u.s. leadership. it is really interesting because we are seeing it at a record high when it comes to the ratio of the s&p 500 and the broader s&p

tom: maybe lagarde will go into space with baby hosts -- with bezos.martin adams with us now, an important conversation to start off earnings season. reason one, she has the courage to be in the market the entire way. she has participated in this bull market, and she's the queen of granularity. what is the granularity of bloomberg intelligence tell you right now about the accounting statements? gina: i think it is going to be an interesting earnings season for a number of reasons. the first is there's no way that we don't have a record level. we will probably get close to 80%, and guidance won't give this any clear direction as it historically has. the critical part is it is also beaker earnings. you will get a lot of opportunities to add corrections over the second half of this year if margins are any guide. margins eked in the first quarter this year, so we will see a lot of margin volatility emerge. it is also about easy comps. tom: they adapt. how do corporate officers adapt to peak, and how to they adapt to margins coming in? they cut costs, right

kailey: sunshine lagarde -- when christine lagarde walks up to the podium, she will have to factor inhe delta variant. do you see that as posing a risk to growth and how do you hedge against it? katrina: i think the delta variant is factored into the european forecast than it is in the united states we really have not seen the same impact. it is more of an issue in the u.k. obviously. europe has never been a fast-growing economy. i do not think it is going to really impede this. we are so much earlier in the recovery in europe and europe has more flexibility given that it is early in the recovery. it has higher un-implement rates and a lot more flexibility -- it has higher unemployment rates and has a lot more flexibility to put money into the economy. slightly incrementally going into the close next year, we could give 2021 a bit of a pass in terms of economic growth. jonathan: it is good to hear from you. thanks for being with us ahead of the ecb decision. katrina dudley of franklin mutual, a portfolio manager. look at the chart right here of the italian 10 year. 67 basis points. at

of course, christine lagarde will be taking the podium at 8:30 a.m. eastern time.t the same time we are going to get some important economic data in the u.s.. anyone in a jobless claims for last week coming through. a fresh pandemic low is what we are looking for. you were talking about the chip conversation with texas instruments. that guidance coming and a lot lighter than analysts anticipated. are they just being conservative , or is that sending a signal to the entire sector that demand is peaking now? if it is in overshoot, what is that going to mean for the profitability of some of these companies like intel, which we will get after the bell, along with snap and twitter? jonathan: just want to check in on didi in the premarket, down off the back of news from our team at bloomberg suggesting chinese regulators are seriously considering perhaps unprecedented penalties for didi global after its controversial ipo last month. regulators seeing this particular company's decision to go public despite pushback from the side ride adminstration of china as a direct cha

our exclusive conversation with christine lagarde. that's next.his is bloomberg. ♪ ♪ kailey: this is "fbloomberg markets." i am kailey leinz. christine lagarde says they should prepare for new guidance on monetary stimulus and fresh measures could be brought in next year. she caught up with my coanchor francine lacqua over the weekend. >> we have a framework. we have a new framework that is unanimously approved by the governing council and we are going to look at, as we always do every six weeks, looking at the circumstances, look at what forward guidance we need to revisit. we are going to look at the calibration of all the tools we are using to make sure it is aligned with our new strategy. and i think given the persistence we need to demonstrate to deliver on our commitment, forward guidance will be revisited. francine: on july 22, it was always a big meeting but is it a bigger meeting because it is not technical change? >> it is going to be an important meeting because number one, we are going to communicate differently. what analyst experts,

guy: do you think christine lagarde is in control of what is happening?s noise around the fed. when mario draghi spoke, he brought the rest of the governing council with him. alix just read out a headline, the ecb said to disagree on stimulus draft for july 22. has christine lagarde got this or do you think others will try to dictate the narrative? if so, what effect will that happen terms of fixed income? jim: oddly enough i think there is more consensus in europe than there is in the u.s. at this point. part of the reason is the cycle of covid that is going through, europe has been slower than the u.s. to start to pull out of this. i still think there is a lot of use that there needs to be stimulus -- a lot of views there needs to be stimulus in the market -- policy support, not stimulus. policy support in order to ensure proper recovery. that is what is taking place. most people are on board. i know inflation numbers have started to rise across europe and the u.k. to some degree. don't forget we also have a lockdowns across the eurozone currently slowi

yvonne: that was ecb president stan lagarde speaking with francine lacqua.nesia governor saying monetary policy could be tied into next year including interest rate moves. the central bank has kept its benchmark at a record low since february. the strategy is to gradually reduce liquidity in the financial system. he says a rate move could happen if policymakers see signs of inflation, and an ongoing recovery. >> and maybe an interest rate but the thing this is really. yvonne: fresh lines from bank of thailand now, as markets open in the first 15 minutes. the central bank sees a slower recovery that will be w shaped. they see economic forecasts maybe adjusted again and they may revise down their gdp forecast due to the outbreak. they are seeing the labor market increasingly fragile. certainly more dovish commentary from the bank of thailand. let's bring back kurt west from prince will global investors. it seems more and more central banks in this part of the world are diverging from the fed. what are the applications of this? what does this mean -- what are t

here is madame lagarde. >> it is not intended to keep interest rates low for longer.is intended to deliver on our objective. it is intended to reach the target of 2%. this is what we want to do. frankly, the quicker we can do that, the quicker we can use those other tools that we have not used a lot in the last two quarters, which is interest rates, but we are not there. david: you're looking at movers. bund yields are actually down for a fourth straight week. very brief look across your stock movers as we speak. not just china, across asia. can we get that up? one big mover, though, guys -- have a look at this. up over in south korea and up substantially. this has to do with the "baby shark" song on youtube. "baby shark" lawsuits. more to come. we are going to break now. and there you have it - wireless on the fastest, most reliable network. wow! big deal! we get unlimited for just $30 bucks. i get that too and mine has 5g included. impressive. impressive is saving four hundred bucks a year. four bucks? that's tough to beat. relax people, my wireless is crushing it.

madame lagarde told francine lacqua the definition is symmetric.ys asymmetric is david wilson. what do we have? dave: what we have is the comparison between the s&p 500 and its 200 a moving average. it is above that indicator for more than a year. stephen sutton meyer at bank of america ok look and saw what happened historically when the s&p 500 stayed above the 200 day indicator for the entire first half. eat some 34 cases going back to the 1920's when that happened, and only 13 of them actually managed to stay above the moving average for the entire second, so you have the potential for some dollar weakness. tom: so i should go to cash? dave: i am not going to tell you what to do, tom. tom: got it. thank you. anything else you would like to add to this? dave: the average is 13% higher. that is how much the s&p 500 was about this moving average because if you look friday, it was also 13% higher. that has kind of held up. that's the question of when things catch up between where the s&p 500 is now and what the trend has been over time. lisa: i was

investors watch for any tweaks to christine lagarde's toolkit. we speak to the ceos of abb, and roche on this program. good morning from london, welcome to the european market open. 7:00 here in london. mark is with us from singapore. what are the markets saying to you? mark: it is follow-on sentiment from the incredibly strong sessions in the u.s. it is the same as yesterday, a big day in the u.s., so asia was positive. thursday morning has taken a risk on sentiment. we are very focused on asia, but that is an asian story, and in the european session we will focus to the ecb. anna: we will talk more about the ecb shortly. let me get to corporate earnings. helping us recover from the angst from monday. numbers from the consumer products giant here in the u.k. and netherlands. unilever sales up 5%. that is basically in line with what was estimated. the tea business, we heard they were considering options and what to do with that. the tea operations, the separation of that is substantially complete according to unilever. they expect the future of t

lagarde preaching

we're not there yet, says christine lagarde. program, more competitive, more green, and more technologically advanced. that's what the u.k. chancellor wants the u.k. to be. we hear more from my exclusive interview with the chancellor. this is bloomberg. ♪ ♪ anna: welcome back to the european market open. this friday morning, nine minutes into the last trading session of the week, european markets making modest gains, up .2%. with look at the movers, and its an entirely finished affair when it comes to m&a in the valve making space in finland. that's the story moving things around. we'll all show -- valnet is doing the buying. as a result of the share deal, we see valmet moving. valmet managed to fight off competition from sweden that also wanted to get its hands on it. that's an interesting one to watch. we also have house bills. we've got beltway in there. there's still positive on the homebuilders. they make the point that homebuilders share prices are down about 10% the past month, even as the housing market made strong. we k

thursday, ecb rate decision, news conference with christine lagarde. friday, u.s. and u.k.ata. final word with our guests. mark, a lot of ink will be wasted on the ecb next week. when we are talking about tapering, i want to talk about the size of balance sheets. they are huge at the central banks and will remain that way for a long time. what will be important for the next several years? mark: you are right, central bank balance sheets are large and they are not done growing yet although the pace will slow. but we will focus on in particular is the amount of cash available, liquidity in the banking system. right now in the u.s., certainly, it is too much. we heard that in bank earnings. some are trying to manage the size of their deposits, they don't want additional inflows, and they are try to push out a way either to other banks or other parts of the fed's balance sheet, maine and the overnight repo facility. this is the environment that we will be in for a very long time, likely years. the new york fed asked market participants when you think we will start to shrink our

christine lagarde speaking after the ecb decision that hit markets yesterday.the first ecb meeting since the central bank strategic review. it offered renewed guidance. it also said they will not necessarily react if inflation exceeds the target. nigel bolton is still with us. we had christine lagarde giving a lot more detail on how she wants this to be interpreted. under your assumptions about how loose the policy remains at the ecb given what we now know about the strategy? nigel: i think it is a clear message we are getting, not only from the ecb, the fed and also the bank of england and that is the policy will remain very accommodative. it is why you still see equity markets continuing to reach new highs. the underlying environment is going to remain very supportive. interest rates are going to remain low for longer and you want to move into real assets and equities rather than the bond markets at this stage. mark: part of the european equity performance story was the great china recovery story. how much of a headwind is it for european stocks given the sli

we heard from christine lagarde.ilmember, saying this new goal is unambiguously clear. steven: yeah, it was coming. and most in the market expected the ecb to move something more symmetrical. and to me, it's part of the global rates story. in the space of a few weeks, we've had these developments in europe and signs that rates could even be going in the downward direction in china, for example. and we were discussing the u.s. earlier. so it's not part of a global picture. in some ways, the ecb and the eurozone were out of line with other big central banks. the bank of england, for example , they are all looking at targets which they are happy to overshoot and under shoot and balance things out. i think it was fairly clear this was going to happen, but it's still report for the dovish view on rates. in my opinion. selina: -- anna: we're all hearing comments that it aims for this to be emphasized. i suppose it might make the ecb in line with central banks but wouldn't necessarily lead up to what reaction function it is

christine lagarde probably did not want to phrase it that way.: taking a look at this chart that shows the 10 year bond yield cratering, did we hear anything about the bond purchase program? kathleen: not that much. people are waiting for them to reveal all sorts of details about how they might make technical changes but yields across europe really did fall again today because in their long-standing regular asset purchase program, no changes. they will keep buying the same amount until the economy does not need it, until they no longer need accommodative monetary policy. really interesting to me is christine lagarde said they did not talk about the emergency bond purchases because they will not do anything like that while the pandemic is still threatening the economy. you mentioned the two dissenters and the majority are really on board with this new policy, but the majority also apparently agreed on the new guidance only if it applies to interest rate changes, not to bond purchases so it seems like maybe that door is still open to tapering befor

president lagarde: this may well imply for a temporary period inflation that is moderately above targetrage inflation targeting like the fed? the answer is no, very squarely. dani: paul gordon joins us now. paul, you know, we had assumed that this is what the ecb would do. i mean, the market was really consumed yesterday by this huge drop lower in bond yields. but was there anything really surprising or new or really earth shattering that we learned from the ecb's strategy review? paul: well, i think one interesting thing that came out of it is that there are implications, big implications, for this for their next policy meeting on july 22. there is plenty of guidance in its policy framework at the moment about what it would do when inflation reaches or approaches its goal of below or close to 2%. that clearly has to change because the goal will change from that meeting. but exactly what that means per policy is still unclear. policymakers proposed, or some policymakers, proposed addressing that in the strategy review and ultimately opted not to do so for fear of confusing their message

we are going to hear from madame lagarde in just a moment.confirm at five and lock p.m. tonight in london that most of the remaining -- at 5:00 p.m. tonight in london that most of the remaining covid restrictions will be lifted in london. the eu postpones its push for a controversial digital tax, handing treasury secretary janet yellen a big win in brussels.

lagarde preaching patients in terms of getting that inflation goal up. big bid into the bond market. yields lower in italy by about three basis points, similar in germany, but i find interesting is the lack of reaction in euro-dollar. you may argue the art -- the market was expecting something more dovish, saw some short covering, stronger euro, and now is around $1.17, still in range bound territory for the euro-dollar. pointing out gold here, central banker after central bank talking about inflation. they call it transitory, but they are still talking about it. unilever, we will get to that later in the show. gold not responding at all. you have to wonder why that is. we will talk to the ceo of cold later this hour as well -- of newmont gold later this hour as well. abigail doolittle has more. this really has to do with earnings. abigail: it does. first, let's take a look at texas instruments, down 5%. they put up a strong second quarter, but it is all about that guidance. hearing a lot about negative guidance. the third quarter disappointing relative

but what a change of messaging have we seen with christine lagarde.this market miss the communication of president draghi, that is for sure. and that was a high bar anyway. let's be clear about that. could the barbie any higher for the handoff? i think the bar was pretty high for chairman powell from chairman yellen, and that first quarter was not pretty. the man we heard at the end of 2018 is just a different person compared to the one we hear from at the moment. tom: i am going to do a gdp analysis. where is the boom in europe? it is there, but no it is not. jonathan: bank of america asking that question this morning, too. the s&p advancing 0.4%. another beautiful morning in new york city. good morning to you all worldwide. this is bloomberg. ♪ laura: with the first word news, i'm laura wright. talks between the european union and the u.s. on vaccine passports are making little progress. bloomberg has learned that because there is no certification program in america, the eu launched its covid pass at the beginning of the month. the bloc is at an adv

saed: when i heard christine lagarde speak, i walked away thinking this is a different ecb.he policy has shifted somewhat the past few years. however, i have a feeling this ecb is not going anywhere anytime soon. a very big change relative to the policy that -- i think this ecb is seeking inflation to stabilize the market over this unknown period over the next six months. manus: that was the view last week, and it puts the taper debate to bed in europe. thank you very much, saed abukarsh, chief portfolio manager / co-founder, ark capital management. he is joining us from poland. coming up, tesla ceo elon musk warns the global chip shortage situation remain serious. more on this story, right here. this is bloomberg. ♪ >> regarding chips, we are pretty good because we bought ahead for the near term. longer-term the problem will go away. the medium-term planning, the beginning of next year, we have risk mitigation strategy, including alternative sourcing for some chips and alternative designed to accommodate those. i think we are in a good position. we have a number of backup p

christine lagarde announced they are inflation targets. just under 2%. and sustaining it there.her central banks, saying it is going to be just below -- excuse me, symmetric around 2%. does this mean for policy? does it mean for guiding interest rates? how do we know what is going to make them make changes question bloomberg economics, look bring -- let's bring this drink -- screen backup, the governing council will commit in its forward guidance to keeping interest rates unchanged until inflation is forecast to reach or slightly surpassed 2% and remain there for some time within the central bank projection period of two to three years. more specific than the federal reserve, everybody is wondering, averaging of 2% above, how long, a moderate time, what is that. but let's look at what inflation is doing, because that helps us understand what the ecb is looking at. and christine lagarde they be talking about tomorrow, you can see the main inflation rate is up to 2%, it is expected to fall up to 1.4% in 2023. presumably, they are looking at a transitory inflation situation, but wi

christine lagarde address to this earlier. >> the general board last week noted that these conditionso not deteriorate materially. our recommendation on the restriction of distributions, including dividends during the covid-19 pandemic, could be allowed to lapse at the end of september '21. guy: european banks, 25%, you own them at the moment, will it take a continuation of what christine lagarde was talking about? the united states are able to return money. how big a part is it when you are looking at financials? mark: that is one of the accelerating sectors for banks. in our investment thesis, it is about trading historically cheap -- on top of it, while rates are higher, which is certainly a positive, we have a broadening and strengthening in the economy. that means we will see less defaults. we will see some of that price tension moving upwards. a lot of -- taylor: more broadly speaking, it has been europe that has been lagging the price action for the first half of the year. do you expect that to change? is that a dollar weakness call for you? mark: we had europe catching up stro

this is christine lagarde looking ahead at what to expect. >> it seems to be an important meeting. a new framework that is unanimously approved. we will communicate differently. it will be your -- more pure, simpler, crisp and to the point. as little jargon as possible. there will be afford -- forward guidance review. we want to continue to support that recovery that is underway. there will be some interesting variations and changes. now is not the right time to talk about it. david: there we go, something to look forward to in about nine hours. moderately risk on. you are getting across equity markets, not so much across commodities. the dollar is on offer right now. some of the moving averages are pointing down. it will actually take more than two straight days of gains like this to turn the ship around. >> you have reached peak growth and now you have the virus. what does that all actually mean when it comes to risk assets? you reach the base effects. >> we are flat on u.s. futures. plenty more ahead, this is bloomberg. ♪ [ "me and you" by barry louis polisar ] ♪ me and you just

sticking with the ecb, christine lagarde says it has learned from history and want to rail the recoveryy tightening too soon. in the first morning -- meeting, she said the inflation expectations are rising but there is still some distance from the 2% target. >> it's not intended to keep interest rates low for longer. it's intended to deliver on our objective. it's intended to reach the target of 2%. this is what we want to do. frankly, the quicker we can do that, the quicker we can use those other tools that we have not used a lot in the last few quarters which is the interest rate. we are not there. dani: what does this all mean for markets? joining us now is janet mui. thanks for joining us. happy friday to you. does the market now, especially in europe, care about the economic fundamentals? is it all about ecb and asset purchases at this moment? janet: good morning. things for having me. the central bank acts like it's really important. it gives more certainty on the direction of monetary policy. they expect qe2 continue and negative rates to continue. it's not a major surprise. it i

we heard earlier from christine lagarde. >> this may well imply for a temporary period inflation thate target. are we doing average inflation targeting like the fed? the answer is no, very squarely. amanda: one of the things that makes this so interesting, the ecb would kill for inflation around 2%. it would be a good news story if the stimulus -- and i don't think we acknowledge it in america enough. it would be a good story if this stimulus produces some stimulative growth. matt: i have long told my wife i want to earn a maximum of $1 million a year, but i have changed that target. now it is a maximum of $10 million a year. neither one is achievable for me, but maybe it will be easier to rise closer to the first goal if i put the second one in stone. core inflation in europe has not come close to 2% since i've been here covering the ecb, so good luck with that. amanda: i think you can definitely shoot above $1 million. you got it. matt: i guess if it continues to devalue the dollar like this, it should be easier. let's get to the stock of the hour. the white house may be looking to

if you are near the lower bound, as christine lagarde said, you would need an especially forceful response we could be in that position for a while. >> bloomberg's paul gordon. let's get more insight into what this means for investors. hannah gooch-peters joins us now. hannah, did anything you heard out of the ecb change the way you are thinking about european equities? hannah: for us, i think in terms of where investing in europe, we are investing in companies that are so not -- are not so much impacted by the ecb. we are looking for software companies, platform companies, or in terms of consumer staples, input cost inflation might be a problem for lower quality consumer staples. we are looking for ones that can push that input contemplation onto consumers without impacting on them on prices and margins. guy: hannah, you are bottom up, trying to pick good stocks care the top-down picture at the moment is one of volatility. you're seeing bond yields on the move. it is rippling into equity markets. we are seeing a significant drawdown today. where the opportunity in that? there is a danger

i understand we will hear from christine lagarde in about 90 minutes. we need to reflect on this equity market. the s&p is more than 1% lower. in the bond market or break of 1.25. right now 1.2562. this bond market right now, how it is set up on 10, unreal, on the curve, it makes the cyclical trade quite difficult. romaine: it makes it quite difficult. the bond market has been the traffic light for the equity market. the bond market got it right when it led what front run what it up being a massive equity rally. the signals we are getting are showing you the trepidation is justified in you already saw that in the cyclical. folks have been piling out of the cyclicals for the last four weeks. the underperformance of the russell is very significant. we have not opened lower on the s&p 500 for three weeks. jonathan: what you're alluding to is important. this idea is the move has not developed over the last week. it started from the end of q1. breakevens topped out in may. he started to see this bill through the equity market in the last four weeks or so. to

we heard from christine lagarde.he spoke to my colleague francine lacqua over the weekend, sounding quite positive in some ways, talking about the opportunity that a new framework would give her. in terms of how divided you think the ecb is going to be going forward, when do you think the taper is going, given what you found is a reasonably optimistic picture in terms of the recovery and the delta fading into the background. ? dr. broyer: that is a good question. probably the ecb has a bit more time for tapering than before. . the new reaction function is yet to be discovered, so it will be very interesting to listen for christine lagarde at the monetary policy meeting of july. given sue trim work it -- even -- the target for inflation is a bit higher. saying that qe will remain above will mean that the risk of having the ecb starting discussing not only tapering, but reshaping of the balance sheet, that is why yields are going lower. guy: thank you very much, indeed. always appreciate your time. sylvain broyer joini

the interesting thing is that this is all happening in a very changed environment, as president lagardeaid many times. physical fiscal and monetary policy are pushing in the same direction. whether that lasts is a different question, but it does make this debate even more complicated than if we -- then it would already have been. taylor: bloomberg's paul gordon, thank you for the insight. we are going global back to that ship shortage. a great conversation the last hour from the freightwaves ceo, highlighting some of the shortage is not only within the labor market, but the chip market, and that crisis is deepening. we'll take another look at daimler, jaguar, all saying that due to these chip shortages, they are going to be losing out on sales. we will have those details next. this is bloomberg. ♪ ♪ ritika: it is time for the bloomberg business flash. i'm ritika gupta. blackstone group is adding two investments that target sustainability and climate change. the deal gives blackstone access to the software segment of the so-called environmental, social and governance sector. it provides

of course, under lagarde, they have expanded the scope of the objectives to include climate change, somedit and distributional issues, so yes, it is a different policymaking body than it used to be. jonathan: it is good to catch up. mickey levy of berenberg. i think the issue with the hawks and europe is that we want to get back to 2% do we want to argue over basis points and have a long-term commitment to extraordinary policy, deeply negative interest rates forever, because that is what is happening. going back to what the pet program is, the e is emergency, and what president lagarde to not give people what they wanted to hear is how they constitute the end of that, and we have gotten nowhere near to describing that. tom: i did the chart going back to before the depression with francine this morning. roger & -- robert -- roger ibberson's chart. this thundering silence is how we have not been able to get near an academic construct of 2%. pandemic crisis or whatever, and there is a rationalization of potential deed -- gdpr over -- under 2%. jonathan: 1.4% for 22. 1.4% on cpi. tom: you ha

ecb president christine lagarde tells bloomberg there'll be guidance on monetary stimulus in 10 days, measures might be brought in next year. and the battle of the space alien heirs heats up as richard branson blasts off just days ahead of jeff bezos. haidi: let's look at how the asian markets are setting up in the start of trading this week. sophie: with a new trading week, i want to show you what's going on with momentum for asian stocks, pulling up the board, we could see some moves higher at the start of cash trade with futures seeing modular gains with concerns around covid cases in the region in places like pan and malaysia. we will get averages later today along with inflation data from india. the focus is brent and new york crude edging higher. once you get on currencies this morning, on the dollar-yen trading close to 110, the kiwi dollar gaining ground. the euro very much the focus after christine lagarde spoke of a potential policy to take that could put the currency on the defensive. the pboc may be wary around u.n. trades after guidance they got on friday. kathleen: china

jonathan: that was president christine lagarde of the ecb.review touches so much on europe. all that effort, all that time dedicated to making the smallest of possibly incomes which moves the european central bank. tom: i'm worried more about italy-england. i didn't see that until now. you've got to be kidding me. jonathan: i think the bond market heard what you heard, not a lot from the ecb. do you think that is christine lagarde, or just the natural consequence of the construct of the european central bank and the bundesbanks rolling all of this as we go on? tom: my eyes are so bad i don't read anymore, but i've got a hallway of economics textbooks we've collected over the years. none of what we are living is collected in a single one of those books. they are all making it up as we go. someone who doesn't make it up as ian lyngen, bmo capital markets, giving guidance on price and healed. we are thrilled he could join us today. what are you writing today so i can think about it over the weekend to act on monday? what is a specific thing for

jonathan: i remember a certain president lagarde. do you remember the news conference where madame lagarde said about not doing too much too soon and try to push back? tom: there was a tantrum. that is the big fear, to repeat what we saw couple years ago. everyone is managing the message. you will see that with the secretary of morning. jonathan: 1.45 on payrolls. we will catch up with a labor secretary following the payrolls report. the number is out at 8:30. tom: maria tadeo killing it with research. she is also -- has also reviewed things. jonathan: so we have taken three islands off of the list? tom: we have. thank you to maria tadeo. jonathan: we might find out by the end of the show where lisa is going on vacation. lisa: like a game show, sounds fun. tom: all-time highs in the equity market, payrolls friday. this is bloomberg. ♪ >> with the first word news, the opec-plus alliance has fallen into bitter inciting. a key member, the united arab emirates, blocked a deal at the last moment, forcing the cartel and allies to postpone

we are expectinghe t press conference with christine lagarde at 8:30 a.m. front desk. yes, hello... all in our app. expedia. it matters who you travel with. expedia. ♪ ♪ ♪ digital transformation has failed to take off. because it hasn't removed the endless mundane work we all hate. ♪ ♪ ♪ automation can solve that by taking on repetitive tasks for us. unleash your potential. uipath. reboot work. hey, it's good to see you. the company we've trusted to keep us working remotely, is the same company we'll trust to bring us back together. cisco. the bridge to possible. >>> good morning we are currently looking at another positive open. we'll speak to that company's president exclusively. and no deal yet close to an agreement and pete buttigieg, treasury secretary as the final hour of "squawk box"begins >> good morning. futures are up and after monday's losses some of those have been reversed check out the price of wti crude that gained more than 4.5% since its best day mid-april senate republicans blocking and that was to be expected. yesterday's vote was procedure al the 22 member bipart

go with you on this — two men slagging off the first female german chancellor, who is as christine lagardel woman who combined, yes, meticulous thought and consideration with some pretty daring policies. of course in greece there is this feeling that it is because of her they went through this terrible crisis, but the eu isn't just angela merkel. and i think what she has achieved in these years, a young woman from east germany who came over and has kept germany steady through it all. in the 2008 crisis germany did not suffer as so many others did, because the eu isn't one nation. each nation has its own capacities and distinction. i have just been talking to 32 british people who have taken out german citizenship — a 2,000% increase in those. anyway, the equivalent of thomas. they love germany, they love merkel. i wanted to say that because i'm not going to, you know, go on this fairly destructive train of thought you have taken out. now for your question: yes, i think germany and italy during that crisis, maybe the entire eu, should've been more — i don't know, kind or considerate. taking

ecb president christine lagarde is speaking and taking questions. questions that the eu parliament committee for economic and monetary affairs. you can watch that live on your bloomberg terminal. she is speaking of course as chair of the european union systemic risk board. the euro area recovery faces uncertainty from mutations, and banks must fully reflect credit risks and provision early for some of these risk-based messages she is giving at the moment. let's get back to the markets than. 25 minutes into our trading session, we have a focus on airlines today. we have eu covid passports coming into focus. we are seeing some positivity for some of these stocks, the generally speaking, we saw heavy selling yesterday at the half year end. some of the beaten up names in the aviation space doing pretty well today. travel the biggest gain at the start of trade. ryanair up by 2.7%, and i will be speaking with the ryanair ceo about eu covid passports. that conversation coming up. this is bloomberg. ♪ look...if your wireless carrier was a guy, you'd leave h

around europe, given how quickly the market has bounced back from covid, but you have seen madame lagarde as well speak about this inflation targeting shift they are doing. it is also not similar to what the fed is doing as well. take a listen. >> the governing council considers price stability is best maintained by aiming for 2% inflation target over the medium-term. the new formulation removes any possible ambiguity and resolutely conveys that 2% is not the same thing. yvonne: you've got to wonder. china could go that way, but the fed is on a different path. does that change the macro backdrop specific -- significantly as we look at these policies? will that be driving the markets more so than the relative growth we have been seeing across economies as well? that will be a key focus. we have been talking about singapore and how they have been trying to move away. will these economies be having faster vaccination rates? it seems like right now, we are focusing on that and as well as, of course, are we reaching that peak growth level with the gdp numbers out of china happening next week?

it's going to be really interesting to see the pushback we get from ecb president christine lagarde.ot a new target. it's 2%. that's going to be a big shift. tom: i think it's going to be really different. also look at emerging markets. it's a bit off the radar. emerging market will be a challenge. jonathan: the shanghai comp is giving me nothing this year. that was the international story that was really meant to deliver. tom: the red sox are giving me nothing in the second half but they won last night. jonathan: you know how it feels then. you feel their pain i'm sure. tom: dr. brammer on some of the international relations at the moment. if you're in arizona and you come out to new mexico and go east into west texas, edward ludlow this morning. i think something has not been discussed with blue origin. within the mercury redstone of alan shepard and then gus grissom before orbit, there was a stunning lack of preflight testing. the legitimate space race in the 60's and 70's and here we've got major major rocket testing before we throw four people into orbit. how confident is this t

christine lagarde said the regions lenders could see a cap on dividends and share buybacks stood by theber. christine lagarde told the european lawmakers that restrictions could be removed if economic and financial sector conditions do not worsen. last year, regulators issued a de facto ban on shareholder returns as a trade-off for taxpayer funded stimulus. global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. haidi. haidi: credit suisse is raising salaries as it tries to retain staff after the scandals. let's get more from our asia finance reporter, bill ahmed. -- nabila ahmed. we have seen a lot of banks boosting pay. will that be enough? just want to check that we have you. nabila: yes, i'm here. haidi: all right, we are -- so obviously, just the latest in a number of different wall street banks and global banks trying to retain talent. is it enough that they are just going to pay more? nabila: haidi, this is credit suisse trying to keep the dream alive. the

the yield down. 1.2433. 25 hours out from an ecb decision and conference with christine lagarde. tom: it is going to be interesting to see on the ecb, what is your initial thoughts? jonathan: euro-dollar. have we seen the highs already? have we seen peak euro strength? dukes is out suggesting maybe we have, may be the strength is behind us and not in front. they were looking for 1.30. tom: you frame out, how do you go down to 1.15. instead of the geography that you are an expert at, in emergency rooms at the johns hopkins hospital, there's gotta be a certain percentage of people working there who are unvaccinated. there's got to be a certain percentage coming in unvaccinated. what do you do? >> regarding employees, we are vaccinated. we all do show our vaccine status. regarding unvaccinated patients, we have that knowledge on who is vaccinated and who is not. my practice is to be ready if i am unsure of vaccine status or covid status. jonathan: i was surprised to read in the new york times that around 60% of workers in the city's public hospital system are vaccinated. i would exp

we will hear from christine lagarde. we've got some news.han: wrote tom: road trip. -- tom: road trip. jonathan: the uk2 allowed vaccinated residents to return without quarantine. if you live in the u.k. and have been vaccinated in the u.k. you can travel now. you can return without quarantine. here's the issue, if you are a u.k. residents and try to come to the united states directly you cannot,, that's the problem. we do not have a reciprocal relationship with the united states of america and this is the problem right now. from july 19 if you are vaccinated you can travel to europe, back to the u.k., no quarantine. my personal example, if i fly to the u.k. today before july 19, i would have to quarantine for a short while. i would not be able to fly back directly to the united states. i would have to find a third country and stay there for two weeks. what a fantastic time of the transport secretary of the united states this morning. why do we have no reciprocal arrangement with the europeans, with the u.k. ready to go for this summer to he