i want to look back at socgen.oop which says they could cut thousands of jobs in the investment banking unit to bring back -- down costs. it seems the market does like the idea of streamlining that unit. to thisant to look over area, a digital consultancy business based in paris up more than 16% to date. it missed on the net income, but did reaffirm some of the guidance. it seems the market does like the reassurance going forward into the rest of the year. lastly, i want to look at this company based in stockholm. the stock is down 10%, the most in 2017. they have had to cut for 2019, but also there is a note out which is the fact that there were no new orders, even though they did get approval for their treatment out of the fda. it may call into question the business going forward and into the rest of 2019. matt: thanks very much, maria tadeo looking at your individual movers. don't forget, individual terminal users can interact with the charts they see, just type gene keady go. tv go. because up that, next, w

a cautionary tale coming through from socgen.en, sector in and once again, stellar numbers from oil. total is the company helping us move higher, i imagine. maybe it is an outperform. let's look at some others, utilities and information systems. somewhere, we have got moves in those appetite -- advertising businesses. they rocked madison avenue and maybe here in europe as well. matt, what do you see? matt: a lot more losers than winners this morning. she take a look, 450 stocks are down, 100 and change are up. winners, you see a lot of these earnings stories shining through your -- through. socgen one of the biggest gainers, interestingly, as they moved to scale down trading. also cutting forecasts, so it is interesting to see them on the winning side. ricard having a great day. she take a look at the losing side of the ledger, wpp up there. , etc., in the communication services on the stoxx 600. you also see invest us win systems over here. we will be speaking to their ceo and just about 30 minutes. us for that, that company for

socgen,t to french bank considering cutting jobs. this amounts to cut costs.porting full -- nice reporting. another the organization. how severe is it going to be? >> what it appears as of today position of which parts --the socgen investment bank hundreds, maybe thousands of job cuts. yet, but there is a lot of pressure today to produce the cost -- reduce the costs, and socgen is having a particularly difficult time. it is going to be -- the decisions have not yet been made. vonnie: it employs about 20,000 people. what has the union response been? is filteringwhat from the union's position is that the little they know about from the plan, web hosting i could read this to -- they is trying need to improve revenue. -- was nothere is completely supported. emerges from what they don't is that understand fully where the cuts will happen. bio, socgen is about to move into a new building. is there any suggestion that may not happen? fabio: oh, that is a good question. that isay that something that should probably be explored. i don't think we are in possession of an

thousands of jobs at socgen may be in jeopardy.still deciding which parts of the business with brenda -- bear the brunt. global news, 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. tom: thank you so much. data check right now. seven. up the euro not doing much. i would note the vix is a bull market. what do you have? guy: let's talk about what has been going on around the world. with i strongly day rally in china. morning sessions, nothing happening. the afternoon, things going on. the margin trade is now back on in china. authorities are allowing chinese equities to get into gear. european stocks going nowhere in a hurry. report.ising bloomberg tom: tough call on the bloomberg today. wanted a reduction. this goes into the inflation news. is the idea of a lower inflation rate. let's go to andrew sheets of morgan stanley who is in charge of your december, january and february. on how torsation reset in the equity market as well. let's

and spending socgen, the bank's global market business suffers despite a beat on fourth quarter net profit >> we have to adjust our plan for the external environment 18 months ago we had in mind a better gdp rules of the worldwide basis. >>> let's get you up to speed with some of the market action here in europe after a fairly soggy handover from wall street. we're not seeing an appetite for stocks in europe we're down two-tenths of a wench mark a breakthrough between u.s. and china. yet, we have not managed get to anything tangible for investors, so some of the appetite starting to fade. earnings season here in europe also having a big impact on the direction of trade in many of the sessions we've seen recently let's switch over to the boards, and you can see how we're traveling on ftse. brexit a key concern here. we're at 71,77 on the index. big day around the bank of england as well. this is a signal it's going to send down around brexit and monetary policy as a result. watching very closely today, and any sterling movement that is could impact ftse so far we've seemed to have gone back

hotel --ad socgen and totale.look at the bond markets, the 10-year treasury yield, not a huge amount happening. we could see a little bit of bomb spread widening. -- bond spread widening in italy. the 30-year got a pretty good reception. that in this low rate environment we have seen a number of countries take advantage of that low rate environment in europe in terms of issuance. let's get the first word news in dubai. >> thanks. theresa may heads to brussels today opening -- hoping to win concessions from europe. a deal is increasingly looking unlikely. sources play the next brexit vote could be delayed. this comes as jeremy corbyn lists five brexit the man's, the changes include a customs union, clarity on security cooperation, and commitment. jay powell has given a positive assessment of the u.s. economy. speaking at an event for teachers, the fed chairman said the u.s. economy is "in a good place ." as investors from pimco to vanguard say the fed pivot has killed off immediate risks to the yield curve inversio

now, we are looking at the socgen story. let's get details now.berg managing editor for finance joining us now. $20,000, how many jobs could be at risk and where do we think they could be? >> what they are hearing is it could be 1000, that is what we have in our story, as much as 1000. or it could be more, mostly centered around france. there will be some back office functions and essentially they will be looking across the board for some cost cuts. this is against the backdrop we have been talking about time and time again with the european banks and the french and banks. vonnie: i am losing track of how many times that socgen has come up with a new plan. how long will it be until they get this sorted out? >> you are seeing this play out everywhere. you have an interest rate environment that has been so hostile for a lot of the european banks. and investors are going to be losing patience very soon. there are a lot -- not a lot of avenues to grow the top line. the only way that many of these banks aren't able to show any kind of movement in the n

. ♪ >> socgen is drawing up plans to cut jobs in the investment bank.could cut hundreds or even thousands of jobs, including roles in support functions in the investor solutions unit. give us what we know here so far, and what we expect to happen. >> it's difficult times for european banks. they have been under pressure in training at the end of the year, and banks still need to make efforts. socgen announced a couple weeks ago and now the understanding is that in terms of the jobs effort, it's going to be pretty massive. but it is stage, something that will be quite important. ♪ upecb officials are setting their meeting in two weeks as a key, key meeting to decide if the euro area slowdown is bad enough to warrant some sort of attention. we are hearing that a lot of action is being taken to ready theresearch around it, but ecb is taking a very calm approach. >> we today got the counter the january meeting, and the conclusion was we need analysis, but we shouldn't rush with a decision. it's quite a hefty sum, more than 700 billion euros, and the questio

still with me is kathy jones, subadra rajappa from socgen, and diana amoa from jpmorgan asset management let's begin with italy. the monster demand for eurozone debt. what's behind it? diana: that particular issue was interesting because they came to market with a pretty decent concession. they added about 25 to 30 basis points to the 30-year bond, which the market saw as an opportunity to get some duration at relatively attractive levels. but what we've seen since then actually is the curve has underperformed, and we saw the secondary pricing up to where this bond was issue, rather than the bond rallying back. ultimately it comes down to the dynamics we have been discussing. for italy, specifically, it's seen as a duration. european rates are very low. the prospect of ecb hiking is off the cards. in terms of the high-yield space investment grade, we had very little issuance in december last year. investors were de-risking portfolios. so, people have come in here lighter risk than they wanted to, starting the year, at the same time where we see money coming out of leveraged loans. there'

dlach goingis guns after socgen.regulators told the european regulators what to do? alison: they cannot directly. there haverisis, been nuances about different regulations and regulations within the u.s. that govern foreign subsidiaries and what will happen abroad. our regulations competitive -- are regulations competitive? we're seeing some of that potentially roll back with some of the proposals. , if your difference is look at their revenue environment, the environment is better in the u.s., we have had better growth. in europe, especially this quarter, capping off the fact that the u.s. has continued to europeans have trailed, we saw disappointing announcements out of so cgen third deutsche bank has gone through one strategy after another, revenue growth has been elusive and the fact that continues to trail is what has people talking and increases the focus to look at other options. what happens with deutsche bank? will they merge with commerzbank and does the catalyst have to be something internal? alison: for d

incredibly shrinking socgen. they announce cost cuts after trading revenue tumbled. boe rate decision. managing brexit with low unemployment and higher wages. that decision out right now. completely expected, no change when it comes to rates. however, the bank does cut its growth forecast, saying the brexit damage has increased. voting 9-0 to keep interest rates unchanged. they do see weaker growth because of brexit. david: what mark carney has been able to say that we have a deadline of next week. alix: the cuts are real. cutting growth to 1.2% from 1.7%. these are substantial cuts here. david: we may raise rates. has economy ise, softening faster than he thought it would be. alix: you're going to buy sterling -- sell sterling and buy bonds. twitter coming out, first quarter sales missed estimates on the midpoint. about $775 million on the high end. the midpoint winds up missing. average monthly active users coming in below estimates. earnings seemed to be a beat, but we don't know if it's totally comparable at $.31. david: yum! also out with earnings. they missed o

earnings this week, italy's beat on fourth-quarter profit and delivered on dividends, while france's socgen would cut costs by 500 million euros. bloomberg spoke exclusively with the chief executive of both lenders this week about europe's larger economic picture. let's start with carla mussina, who told me that while italy is technically in recession, he's optimistic about the year ahead. >> we have in italy a slow down in the real economy for sure, but i think in the second part of the year, we can have a clear recovery due to internal demand acceleration, because the measures from the government will bring momentum into and internal demand, giving money to people in accounts and will increase consumption. we can have a recovery in the second part of the year. nejra: you seem to think that the government will be part of a pickup in the italian economy, but how long can the government last? could we have early elections? >> it is difficult for italy to have fighting between the parties, but also, like in all the other countries in the world. him we have to consider that this government sta

is taking a hit when it comes to the auto sector, daimler and volkswagen are trading lower. , the socgen's bmps are dropping that number down. wirecard bouncing back. investor calld an earlier making it clear it doesn't believe in the ft reporting regarding accounting. data from you believed an investigation will prove that to be correct. the asset management industry continues to be under -- the outlook seems to be the reason the shares are down today. the company has warmed already. i think it was the outlook that not ryanair shares down by around 1.9%. not much movement there. volume traces. -- bases. that is a look at the european close. vonnie: we have seen some of that antibusiness sentiment coming out of the markets. if you look right now at gold, we are just at 13.14 announce. above then right up 13.30 mark last week. the yen is weaker. crude oil down 2%. we're still just about the $54 a barrel mark. still a little bit higher than it had been. the 10 year yield at 2.73%. have the following wti going lower. it isms of currencies, the oil currencies that are majorly affected from yes

let's get the view of kokou agbo-bloua from socgen. it is never that simple, is it? are you advising clients to de-risk while not missing out on further steam in the risk rally? kokou: ultimately what we tell investors is analyze the different phases of a business cycle. like a credit swap, then a deleveraging phase, 6:00 is the real everything. we are between 6:00 and 9:00. formately, we are looking relative value trades that will give you a positive carry book while adding complexity to positions. you can think about trades like going long strong balance sheet and short week balance sheet companies. in our mind, that is the major risk today. i am thinking a corporate bond subprime we could be facing in 2020 because of the massive refinancing mountain. a lot of the leverage companies have taken on to buy back their own stuff is due to be refinanced in the next three years and short-term rates are 200 basis points higher. the cost of refinancing could be higher for these companies. nejra: i find it interesting you say and said the new subprime could be the high-yield

incredibly shrinking socgen. they announce cost cuts after trading revenue tumbled.ent and higher wages. that decision out right now. completely expected, no change when it comes to rates. however, the bank does cut its growth forecast, saying the brexit damage has increased. voting 9-0 to keep interest rates unchanged. they do see weaker growth because of brexit. david: what mark carney has been able to say that we have a deadline of next week. alix: the cuts are real. cutting growth to 1.2% from 1.7%. these are substantial cuts here. david: we may raise

interesting to see these banks and others, including lloyds, socgen, all following and all weighing on stock 600 this morning. anna: european markets opening broadly higher. following progress in u.s.-china trade talks. joining us now is patrick armstrong. good to have you with us. as one of my colleagues was putting it, and adrenaline shot in the arm by president trump on the shutdown and trade. suggesting maybe march 1 is not a set in stone deadline. do you think the optimism around trade is well-placed? patrick: we have been buying into down days, basically thinking we will get a truth. not an all-encompassing deal. that will be very hard to achieve but that has been a big overhang on markets. tariffs, i think we were going to get a delay, increase and rollback progressing through q2. that is a clear risk to markets, but common sense will prevail. matt: once you get past that -- how does the market look in terms -- judged by fundamentals? we had a warning from morgan stanley yesterday that total earnings growth in 2019 would only be 1% for s&p 500 companies. patrick: it is not in li

royal mail up 4.5%, i think it was socgen taking the cut.s an interesting that stock is down by just under 4%. another part of the earnings story as is b.n.p. paribas heard -- paribas. let's get the first word news update. as lee humphrey is in dubai. president trump delivered the state of the human address, calling for bipartisanship, but on his terms. and a wide-ranging speech, he has a second summit kim jong-un and lauded the u.s. economy as far and away the world the u.k. government could be planning to delay brexit according to the telegraph. they said cabinet ministers have secretly discussed plans to delay the date by two months. meanwhile, ebs has delayed approval of moving his assets to germany. the bank's goal is to keep operations going over uncertainties around post-brexit passporting rights. italy's populist government is set to be selling $2 billion of property to rein in foreign debt. sources say the ministry has identified addresses that can be offered, namely military barracks, hospitals, and government buildings. italy has

had socgen sounding the retreat after missteps foiled their ambitions.hey were rewarded on the day the earnings. here isare seeing basically fourth quarter capital markets and investment banking revenue down 29%. we are following a theme here. it's proposing a dividend of 69 euro cents per share. net income at 1.0 one billion euros. the take away here is that it is capping a tough trading quarter for the top french banks. manus: they are coming in hard. they are coming in fast. the u.s. president donald trump the mood to consider pushing back the deadline for the imposition of higher tariffs on chinese imports by 60 days. next hourhost for the is from royal london asset at -- asset management. your initial reaction? >> it's good news. we have to hope that backdrop stops this cliff edge of tariff increases again. , are's a lot of data significant slowdown in china due to the first-round of tariffs. if you look at it from domestic demand, exports to china have dropped off. it has hit global trade hard. in the u.s.ss so because the trump tax reforms have pr

thursday, we get socgen. it already has some of the worst ratings among analysts. warned a 20% slide in their global markets revenue. definitely some negative reaction we can expect on thursday. and we also get some of the italian banks and these are going to be really in focus. that we see high marks from analysts here. days ago, italy officially entered into a recession. roughly 1.5 trillion euros of italian debt are on the balance sheets of rome and milan. these concerns to extend beyond italy. i want to show you a really interesting maps that breaks it down. here i had the balance sheets of non-italian banks, how much italian credit. markets calm for now, but around italy could quickly sweep to the rest of the continent. a total of about 425 billion euros. french banks the most in danger. 485 billion. bnp makes up half of that. that is tomorrow that we hear from bnp. this issue closely under a ownoscope as european banks the most out of any sector the past 12 months. anna: thank you very much. dani burger with the latest on the banking sector. bob parker is sti

no comment from socgen.anks shares fell to a five-year low yesterday and it has plans to shrink its trading business. in germany, shares of wirecard plunged today after there is an investigation into reports about internet payment. they say that they are not investigating wirecard employees over accounting fraud investigations. wirecard has denied the claims. are offices in singapore were searched by authorities. national enquirer says that it 'ill investigate that bezos claims were substantiated. and that is your business flash update. lisa: now we get to talk about barbie. a mixed bag for the tour industry. mattel is soaring, with its record.day gain on here to explain that and what it means for the future of toys is our own matt townsend, he covers consumers for us here on bloomberg. . what does it tell you about the state of toys today? matt: it is a muddy picture. the toys "r" us liquidation last year was a huge hit to the industry and we're seeing it play out differently with the two biggest players ou

bnp was one of the banks along with socgen cutting their proprietary trading unit. tradewas a derivatives that went awry at the end of the year. there's a question whether the power has shifted from the sell side to the buy side in this era of quantitative easing. there's a question of whether that plastic model of making bets with their own money is not profitable. goldman sachs thinking about cutting the amount of money they commit to their flagship that trading business. why? they are not making enough money. david: exactly. this is equities in the fourth quarter, which were ms. -- which were a mess. >> that mess in the fourth quarter, those trading losses were related to trade and fears about the trade war's in china. in december, the christmas crash we saw in the markets came after the dinner in buenos aires and the messages that came after that. 4 tweetus december saying "i am tariff man." david: german manufacturing numbers quite a disappointment, really sobering. how much of that is export problems? >> germany is an export driven economy. slowingching the hi

remain: the us remain: bank of america, socgen, wells fargo, starting to question just how much juiceade. this is the first week we have thee seen a drop in past six weeks. it doesn't come as too much of a surprise, this index actually was oversold last week. bank of america saying that the structural weaknesses in em will emerge soon at -- sooner than later. take a look at the citigroup hasomic surprise index, it pretty much been in negative territory since april and has not improved. we have seen improvements in some of the citigroup economic surprise gauge but not the one for emerging markets. this could be the time when you have to anticipate a slump in em later this year. you should also potentially hedge against the risk of a u.s. recession in the first half of 2020 and how that will play into the emt trade. lisa: let us take up on the idea recession, when it comes to fed action. this is a chart taking a look at the odds of a rate hike and as you can see, it turned negative once again. what it means is that the chances of a rate cut are going up throughout the year. back atere e

thousands of jobs at socgen may be in jeopardy. confidentially for a public offering in the u.s.. the search site is expected to seek a valuation of $12 billion. pinterest is working with goldman sachs and j.p. morgan chase. that is your bloomberg business flash. david: 90% of s&p 500 companies have reported earnings. has looked at the winners and losers sector by sector. >> first where we are in terms of valuation. individual sector still look cheap. within the s&p 500 we are near fair value. our bloomberg intelligence analysts have that right where we are. discretionary, industrials, and financials are trading below their p/e ratio. a lot of the run-up in equity markets people don't believe in. a lot of the riskier sectors have been lagging on a pe basis. 14% of the financials are still relatively cheap on a valuation basis. the safer sectors are trading above. lued.look overva this comes down to some of the price reaction we have seen. as we look forward to where we go, you have the s&p 500 bottom out last quarter and this quart

rishaad: meanwhile, the ceo of society chanterelle saying -- socgen saying the bank is prepared to adapto any brexit scenario, including a new deal. the ceo speaking in paris. no morenk that there is confidence regarding financial services and the transition, even if there is a hard brexit scenario. so, this transition. might be longer. it is more the impact on the u.k. economy, and i hope there will be more a soft brexit than a hard brexit. the trend has changed dramatically. there is a kind of euphoria 12 months ago. so happy with the tax cuts and potential benefits. there is a change, and effectively what we should avoid this adding to this natural , which has created a lot of uncertainty. fundamentally, we are facing structural changes that we are factoring into our strategy. we want to build a model, and i am courage to a certain extent by the way we manage our risks. risks reflect the high quality of our portfolio. all of this is part of solid foundations. >> year bank is one of the biggest when it comes to derivatives. you announced with the brexit that you will be moving clearing

reportingcgen thursday with 14 holds, 52% of analysts putting a hold rating on socgen.utting a cell on stocks. later in the week, we get the italian lenders, i mentioned investors paying close attention to these because of the italian credit story, the buildup on banks balance sheets. the word is contagion, it goes beyond the italian banks. i have a map that shows a bit of this. when we look at non-italian banks, they hold a lot of italian credit, the most from france, 285 billion, half of that is with bnp. tom: thank you so much. gene frieda with us. this is a huge topic. it was a massive backstory. europe has got to fix their banking system. how do they do it? gene: i could not agree more, the thing to do is to consolidate. they have a profitability problem, there is low hanging fruit and it is not happening. theye end, we are worried end up becoming more zombified. it your recollection that the regulators drove in the the solution united states and that they regulation equivalent is not there in europe to drive forward consolidation towards profitability? gene: i thi