mark: a rebound for china's factories. a seven-year high. anna: extending the deadline. irran nuclear negotiators missed their midnight target but russia and iran say a deal is close unexpected drop a statement later in the day. mark: greece finance officials hold the teleconference as the ecb holds its weekly review on extending its lifeline to greek banks. ♪
mark: welcome to countdown. caroline: also coming up an exclusive interview with -- she says she would do whatever it takes to meet the country's fiscal targets. stay with us for that exclusive interview coming up later today. mark: contrasting data from china and japan today. china showing signs of recovery in the factory floor. in japan, business sentiment is stalling. let's start with good news. what is the story behind the china rebound? >> good morning. we are talking about china's growth. it is steady as she goes. manufacturing data coming out as 50.1 for march which is above
the 49.9 from a month earlier. showing signs of the business expectations seem to be strong. numbers above 50 signal there is expansion. economists were expending -- expecting a second month of contractions. factories seem to have gotten safe with stimulus working. things picking up slightly after the interest rate cuts and the demand coming out from the united states. we have this seasonal rebound that we usually see after the chinese new year holiday. a lot of chinese workers heading back to work. we will see the boost in production. some economists say the rebound we saw this month is not as impressive as we typically see during this time of year. we take a look at the unemployment reading in the manufacturing and nonmanufacturing sectors -- those also in contraction zone. you may remember back during the national people's conference
the premier did say the government was willing and probably would step in and responded they see the economy continue to not grow or unemployment continuing on the rise. if we take his word for it, it could be more stimulus could be on the way. mark. mark: yet the news out of japan today isl less. yvonne: it is. it is a mixed bag as well. you take a look at the manufacturing index that came out. it came in below estimates for march. unchanged at 12 from last quarter. the forecast shows it could drop to 10 in june. what is happening here -- companies plan to actually reduce their capital expenditures by about 1% for this year. that is despite this unprecedented stimulus we have seen coming from japan that has weakened the yen and boosted
profits for companies. we are just not seeing that cash trickle in in terms of investment falling for three straight months. we have seen some gains in wage growth but so far. non manufacturers -- some encouraging signs as well. that coming out showing some improvement to 19 from 17 three months ago. the service sector is doing well in japan helping the domestic system coming from the country. no question, the industrial companies do have some concerns. mark. mark: thanks a lot yvonne. caroline: meanwhile, negotiations on iran's nuclear capabilities past the midnight deadline. stakes are high for all sides involved. russian and iranian officials say some major points have been agreed but others say the claims have been exaggerated. it would include the easing of
iran's international isolation and western sanctions. elliott is live for us with the latest. they missed the deadline but there is some optimism a deal could be reached in the early hours. elliot: that optimism is particularly large from the russian delegation and the iranian. they say they have agreed on most of the main points and they should be dropping a deal which will be revealed to the world at some point today. the iranians sounding similarly optimistic. other world powers think otherwise. tthey are making progress but it is difficult. regarding the amount of uraniam num iran can enrich.
more importantly, what about sanctions relief. iran wants the sanctions lifted almost immediately and world powers want a phased lifting and a mechanism where they can impose the sanctions again. if you want to be more optimistic, the fact we have moved into this additional day shows world powers and iran at least agree that they are inching closer towards a deal. they hope to have one, however vague sorted out by today. >> sanctions relief has been resolved. not today or yesterday. we have had long discussions with this. there are issues that are related to sanctions that are still under consideration. this is not the only issue on the table.
there are other issues. we hiopope to resolve them. elliott: they stop talks at 1:30 a.m. it is now 7:00 in the morning local time. one would not expect them to be seen in the next hour or so but it is another tough day of negotiations. caroline: deal or no deal, what happens next because there was an interim agreement agreed in november of 2013 that does give them still sometime until july 1 as the real deadline? elliott: a week is is a long time in politics and a month is an attorney. so much can happen until then. if you are one who sees the cup being half-full, they will
get down to the nitty-gritty and over the next three months, they work out the technical details. they will reach a definitive deal by june 30. iran will be acclimated back into the community of nations and everybody is happily ever after. if you are not that optimistic, you can see any framework agreement coming out today as being vague and some issues being kicked down the road and making it very hard for president obama to send it to congress were lawmakers have been threatening to propose additional sanctions on iran something president obama said would blow up these talks. you can see such a situation taking place whereby congress seeks to impose sanctions and iran walks away from talks and then goes back to doing things underground, working on his nuclear program and even allowing for the scenario where we can see the threats of military action against iran's nuclear program, particularly
from israel. those are two extreme scenarios and we can get either of those or more likely something in between. there is a lot at stake. it really is a case of waiting and seeing what is in today's agreement and what happens next in terms of world powers and in terms of congress as well. caroline: elliott, the lake is half-full or half-empty. thank you. mark: the sooner, the better -- the words of angela merkel. the country has come up with an economic reform plan that its european creditors can approve leaving its banks reliant on ecb loans for emergency cash to avoid default. greek lenders are feeling the pain. banks lost deposits for six months in a row. the euro reacted as well,
extending its biggest slide since its inception in 1999. our international correspondent hans nichols has been following the developments. what does this timeline look like? hans: it looks like we won't have a deal before easter. that was the line from the president of the eu council and then merkel and holland speaking together and both said time is running short. merkel said the talks in brussels were a start but they were not there yet. mr. hollande was perhaps even more blunt. this is what he had to say several days ago -- we have lost too much time. ms. merkel was asked about the plan to visit moscow. she said he was not bothered by that. she said she went to moscow as well. crucially, domestically -- there is a little bit of change. merkel lost a key ally -- the vice-chairman of her sister's
party. he resigned his seat in parliament because he said he is being pressured to take votes on greece that he does not agree on. he has always been an anti-bailout politician but we will see how much domestic pressure increases on merkel not only now, but in june when there could be a potential third bailout. it is something to watch. mark: talk to us about restrictions on greece banks. what is the ecb saying about this? hans: invest cautiously. sound advice by the vice-chairman of thee ecb. she was asked this question when she was testifying in brussels. she basically said invest cautiously. she did not put any restrictions on greek banks from buying. they have the freedom to do what they have been doing which is buying greek government debt. the ecb will review today emergency liquidity systems. will the increased it above 71
billion euros? ufc and about 3 billion in outflows from greek banks you -- you have seen about 3 billion in outflows from greatek banks. we did see the worst quarter for the euro since its inception. but that in perspective -- that is very bad news. you are saving in dollars for education back in the states. if you want to have relatives visit from the states, it is good news. mark: thanks. see you later, hans. caroline: let's have a look at our top stories this hour. nigeria has a new president. he defeated the incumbent goodluck jonathan. he is first opposition candidate to take the presidency since its independence from the u.k. in 1960. the outcome came after days of
disputes and allegations of fraud. iraq is hailing its biggest military victory over the islamic state after recapturing tekrit, about 90 miles north of baghdad. they have taken control of the city government buildings which is a historic milestone but fighting continues on the outskirts. tikrit has been under islamic state control since 2014. 100 business leaders have written a letter to the telegram newspaper spending -- stating the government with threatened britain's economic recovery. it includes the bp chief executive and prudential chief executive. the chairman of bloomberg lp signed it as well. the office argued in the conservative led government is luring a tax which signals it is open for business which is creating jobs.
assad welcomes a dialogue with the u.s., according to him. he spoke to charlie rose. assad: we are not going to discuss with the americans or anyone what we are going to do regarding our constitution or our law or our procedures. fighting the terrorism and making pressure on different countries like turkey. they support the terrorist politically and financially. caroline: we get that in full 2 p.m. and 5 p.m. london time on charlie rose. mark: tell us the stories you want to know more about. happy april fools' day. be on your guard, caroline.
ever quarter. let's bring in a senior fx strategists. . the worst quarter ever for the euro against the dollar. could it be much worse from here? i see you have a recommendation for a short. phyllis: we have a target of 1.04 right now. the hero can go much lower so we are actually forecasting parity and sub parity in the first half of next year. so, the euro can go much lower. a key factor of being qe rather than the politics although the politics will continue to dominate. qe will be a very important factor. mark: i looked at our ecfc function on bloomberg and there are five banks that are seeing parity this quarter. why not be brave and go sooner
than the end of the year? phyllis: it has been a long hard slog. it reacts to new flow as it comes out but the euro trends in a range and then we get a catalyst it will break out of that range in a very significant manner. it is more of a slow mover we are expecting. it is significant. we have been calling the euro lower at 1.40 and 1.38. it was a brave call for a. of time -- period of time. caroline: when you say a catalyst gets it to move significantly, you are not expecting greece to do that. it will go down to the wire and then kick the can for the don the road? phyllis: i think the key is the situation in greece and its eu partners able, it would not be greece. it tends to be ecb.
when mario draghi said we are likely to cut rates, that was a significant turning point for the euro. it tends to be relative macro fundamentals like the u.s. or the u.k. it does not tend to be politics. that said, the politics have to stay quite steady. caroline: you are not expecting an unraveling? phyllis: we are not. our view his they will come to some sort of agreement. although, we are still in early days. even though the april 9 deadline is looming i think eventually we will find a deal between greece and its partners. there is too much at stake. mark: let's talk about the flipside of the trade -- the strength of the dollar. nine consecutive months of dollar gains. three consecutive quarters as well. many calling an end to the dollar's bull run. you are not in that camp?
phyllis: no, we are not. it is almost above all the valuations we are looking at. but, we know that in periods where policy is being normalized, the models do not tend to always get the best indication or it does not tend to revert tot their longer-term valuations when monetary policy is so dominant a driver. the fed is very important. u.s. yields is very important to the dollar right now. that is our view. the u.s. yield advantage will be extremely significant for the dollar in the next few weeks and months. employment is very important. caroline: meanwhile, continues to erod possibility for the many of the big exporters in the united states. have the likes of japan actually seeing improved because the are
seeing the yen weakreer. then we have concerns once again -- manufacturers are not being instilled with any confidence. what does that tell you about with a currency will go in terms of the yen? phyllis: the yen needs to be necessarily quite a bit weaker. japan has a persistent need of an exchange rate to help them in the recovery. we have had a number of doj members commenting that they still have not met their cpi target. we need a weaker trade wages in yen. on the dollar for u.s. exports it is a concern. the fed mentioned it. but trade is a percentage of gdp in the u.s. which is fairly small. it is in the teens, about 12%. it is a concern. i don't think it will be particularly significant. mark: what will break it out of
the range? you say the yen should and could be weaker. we have seen them at 1.16, 1.21 range. expectation of more qe will probably weaken it but that is being denied by various parties. caroline: they say they need more stimulus by april. phyllis: we are expecting a cut in the deposit rate of japan over the course of the year. the yen will be on the u.s. side of things so 10 year yields in the u.s. will be the driver. it will be so much on the japanese side even though developments on the japanese side weren'tarrant it. mark: the 10 year u.s. and 10 year japan bond -- we would do a little chart later.
it is creeping into about 1.6% . it is clear japan investors are buying u.s. treasuries. the gap is shrinking. phyllis: the yield advantage will favor the u.s. and that policy divergence will become more and more pronounced over the course of the next year. we look forward to a re-widening of the u.s. yield bandages. -- vantageds. even though it might be narrowing, we are looking for the yield to widen in favor of the dollar. boj will play its part as well but in the near tearm, look for payroollls and the sensitivity of the dollar to the yield advantage. caroline: what about the british pound because you got a call for it to go to 5% in the first
quarter and expecting it to fall another 4%. phyllis: very interesting currency to watch at the moment because of the election. the may 7 general election is getting more attention. i think sterling will weaken. caroline: even more than the euro? phyllis: we are expecting a squeeze on the euro because of the election uncertainty. not much -- more against the dollar. we are expecting it to move to 1.42. we are looking for recovery afterward the matter who wins. ultimately, we will get some sort of stability, political stability in the u.k. i think no matter who wins will get some sort of coalition. mark: sterling volatility that we had in 2011. that continues for the next 40 whatever days. phyllis: 36, 37 days.
i think volatility will pick up in the run-up to the election. the market is not fully pricing in the pre-election uncertainty to the extent it can. caroline: i'm interested that you think it will cycle after the election. we have conservative government and everyone that focuses on the eu referendum. would that mean volatility is here to stay? phyllis: we would get some low-grade uncertainty if that prospect of an eu referendum arrives, absolutely. we could possibly, in the event people do get worried about an eu referendum, get that business confidence. for sterling, if we get a hit for foreign investment, the brings valuations down. mark: give us the exotic. phyllis: we just put a short on
mark: you are watching "countdown." it is the first day of the second quarter today. the euro was coming back from its worst quarter ever against the u.s. currency. there it is -- year to date 10.9% lower. the worst quarter ever since the first quarter in 1999 when the euro started trading. the euro was trading office closing low -- off its closing low on march 13 which matched levels last seen on january 2000.
you were just talking to phyllis about forecasting euro-dollar at the end of the year. parity is not on the horizon -- the immediate forecast from the analysts. a growing number of analysts are forecasting parity this quarter, including invest egg bbva ing financial markets. meanwhile data released by the imf yesterday showed global reserve holdings of the euro dipped in the fourth quarter with of the shares currency portion falling to the least since 2002. the u.s. dollar representative the largest percentage of the six deal -- $6 trillion total of the reserve. that is the most since 2008. the year to date, the euro has
fallen against all but two of its 16 major trading peers -- the brazilian and danish currencies. the best-performing currency is the swiss franc. the swiss national bank took the market by surprise and ended the euro franc cap. the eurozone features manufacturing numbers from several countries. in the u.s., watch out for manufacturing data and payrolls numbers from adp. there it is -- the euro down by 10.9%, worst first quarter on record. caroline: let's check in on the top stories this hour. google has unveiled two new chrome books reigniting the market for low-priced computers. the laptops that were available for preorder for $149 will feature all day battery life. google is promoting low and
laptops as it looks to draw people into its chrome operating system. the germanwings copilot believed to have deliberately crashed the plane in the french alps informed the airline six years ago he had depression. lubitz hetold the corps about previous episodes of depression in 2009. it is the first time that the airline hasn't knowledged -- has it knowledged -- acknowledged the pilot's mental illness. officers went to getty's home. detectives from the robbery homicide division are dealing with the case. a you can find more on that story and many more on bloomberg.com. mark: nigeria has a new
president. a former military ruler defeated goodluck jonathan with 52.4% of the vote. he is the first opposition candidate to take the nigerian presidency since its independence from the u.k. back in 1960. but results were not straightforward. the outcome came after days of dispute and allegations of fraud. let's get straight to paul wallace the was on the ground in lagos. how did yesterday's election results unfold? paul: it was a dramatic day. on monday, it was announced. it looksed like bahari was in a strong position. it seems more and more likely he would win and president jonathan's position was looking weaker and weaker.
then, later in the evening, it was obvious jonathan would lose. he had conceded defeat in a phonecall to buhari which was a very significant piece of news because there was never a democratic transition of power in its history. mark: why did the incumbent, goodluck jonathan, lose? paul: he's been in power since 2010 but his party has ruled si nce 1999 when nigeria last ended military rule. there is a sense in nigeria that they wanted more change.
have been very frustrated with what jonathan has been failing. the main one was the boko haram insurgency in the northeast. where they incompetent? also, corruption. a lot of people here felt corruption was worth under jonathan, not better. oil prices tanked and that is something that hit nigeria's economy. that is something the opposition took advantage of. mark: what kind of leader will buhari be? paul: people are saying he will be stronger than jonathan when it comes to things like boko haram. buhairri has played on the
anticorruption angle. he knew someone -- seen as someone who is keen. and i hope you will be a lot stronger -- and they hope he will be a lot stronger with crim ea and corruption. mark: thanks a lot paul. caroline: let's take a look at another emerging-market. brazil. bloomberg spoke exclusively with the country's president. she says she would do whatever it takes to meet the country's fiscal target. that is only hours after analysts had a budget deficit twice as wide as forecast. let's listen to the conversation. >> the country's budget was
submitted with all of its underlying structures for us to section or approve and then we are going to introduce the adjustments to our own government spending. we are not able to solve the problem by cutting down on personnel or payroll, but expenses. we will have to rationalize our government spending. we will have to probably reschedule other types of spending. we will have to resort to several mechanisms and that is where the government steps in. we will establish a number of budget cuts. we will not lower our social policy efforts at all because it is not the one element in the agenda that comes from the vast majority of spending. what we will do is we will streamline all administrative activity in the government. we will certainly streamline our government spending pattern. we were rationalized spending and keep on doing what we have
always done. there can be no successful social policy if we don't revisit the policy regularly. caroline: speaking with our very own editor-in-chief john. mark: interest income of the brazilian real is down 17% against the dollar. join the conversation on twitter. let us know what you are following today. tell us the stories want to hear more about. caroline: i'm hoping you will play a break or two., -- prank or two. mark: my parents played a prank on april's fool's. they got married. caroline: something rather more serious -- iran says negotiators have reached a consensus over major aspects of a nuclear deal. a statement was dropped today. our next guest says it could be
of africa's biggest oil producer since its independence from the u.k. in 1960. there was disputes and allegations of fraud. iraq has its biggest military victory ever over the islamic state after capturing the city of tikrit. the prime minister says retaking control of the city's government buildings is a historic milestone but fighting continues on the outskirts. tikrit has been under islamic state control since june 2014. 100 business leaders have written a letter to the telegraph newspaper stating that the labor led government would threaten britain's economic recovery. the list of signatories, include the bp executive and outgoing chief executive. the chairman of bloomberg lp also signed it in a personal capacity.
their concern the government is during -- luring corporation tax which would signal britain is open for business which would boost growth. syrian president al-assad says he welcomes a dialogue with the u.s. but rules out an interim government. he spoke with charlie rose. president assad: we are not going to discuss with anyone what we are going to do regarding our political system our constitution or our laws or our procedures. it is making pressure on different countries like turkey and saudi arabia that support the terrorists politically and financially. . mark: you can catch that interview in full at 2 p.m. and 5 p.m. london time on "charlie rose."
caroline: iran's foreign minister says negotiators have reached some princesses and others say that has been exaggerated. even though many feel now they could start drafting a statement later today. our next guest says it will be months before a final agreement is reached. let's get more with phyllis. months because you feel any agreement is not going to be attachable today. it'll just be writing down milestones, claim they progressed. >> whatever it is that has not been resolved in the last 18 months is not going to be resolved in the next few hours. the statement is likely to find and areas of agreement and this agreement. ultimately, both sides need to show their own sides. mark: what are the main divisions? capacity -- iran should be
allowed to keep. how far the sanction should be removed on the other side of. . big areas that are up for debate. firas: there is a level of stress that surrounds the issue of how much enrichment capacity the iranians will have after the deal expires. the thinking being why does iran need this. they are showing their own sovereignty and that they are state that is equal to india or a brazil or a china. this is what they are trying to pitch to their own constituencies back home. caroline: this is what i think is fascinating in your research. what is going on what iran really wants. what the hardliners are pushing for or against in this deal because both the u.s. and iran have people in their home territories against anything.
firas: there is opposition within both constituencies. with the iranians it becomes difficult to justify the last 20 years of isolation and opposition to the west. it comes difficult to justify the narrative of the united states being the great satan. there is a faction within iran that thanks this deal ultimately -- thanks this deal -- thinks this deal makes them lose credibly. the iranians are pursuing an agenda offd had gemini -- hegemony. also, using the negotiation portfolio and the means of putting pressure on the west and contracting concessions. they go in parallel. they want to ensure their
interest in one area in order to make concessions in another area. mark: what about u.s. hartline's pushing for further sanctions? can obama sell a deal to a skeptical congress or not? firas: the way they see it is this is much more than a single agreement over the nuclear issue. this is possibly redrawing regional alliances in the sense that previously the united states has sided with sunni powers in the region. by allying with the sunni powers. opening up to iran undermine the entire framework and places countries like saudi arabia and israel and a secondary position in terms of their interests and influence in washington. you have to think about it also from the point of view of the politicians who support saudi arabia. the sudiaudis have not managed to defeat the iranians in this
proxy war even though iran has been fighting with one hand tied behind his back because of sanctions. their fear is economic pressures which is an issued to consolidate. many people feel it is not wise to shift from one clerical regime in saudi arabia that is at least below the surface less clerical to a genuine theocracy. caroline: what wins out in the end? economics politics? does iran need money so much that they want to sign this deal? were painting a picture that will never be reached. firas: my assessment is they probably will reach some type of agreement despite these difficulties. it is worth recognizing the difficulties that are there. the iranaiians have to make a decision -- are they confident enough to take this risk and do
the ss they have improved the regional situation to such an extent that what is now required is consolidation rather than confrontation? given the pressures they are under in places like syria and iraq and yemen, this becomes a more probable decision or a more reasonable calculation. there are obviously those within the revolutionary guard that think no we have gotten so far without needing an agreement, why do we need one now? presumably, these are more military men who do not understand economics but also making decisions. mark: is any viable deal palatable to israel? with a reject all deals? firas: i think they will reject all deals because of the understanding they have that this will empower iran in the region and threatened their role. they are concerned that hezbollah is spreading its influence. this is under constraints and sanctions. if the iranians good finance
more effectively, who is to say that he could not win the war given out poorly organized his opponents are and how scary they seem. for the israelis, they are in a position where they are fighting in the status quo and really any change in the region harms their interest in one way or another. mark: thank you for joining us today. firas, head of north africa analysis. we will be looking at our favorite stories from bloomberg's digital output. out of detergent -- there is a button for that apparently. ♪
mark: we are an hour away from europe's equity sessions. time to look at the top choices from bloomberg's digital output. if ever a story jumps out at me, it is today's story by kelly. he has written a piece. nine charts in total which says these charts show the story of world markets in the first quarter. it starts with the euro the biggest story in the first quarter. it has been the launch of qwwe
and the weakening of the euro against the dollar. over the course of the ruble went on a wild ride weakening significantly and then rallying. that left it back to pretty much where it started. the quarter. he shows a chart for oil, gold the dax the bond index. the final chart which is great shows the first quarter return in oil and all those assets. the one to invest in more than oil -- u.s. treasury treasuries, the s&p 500, gold the european bonds, the dollar -- you would have had gains. caroline: the s&p 500 -- the u.s. has been worse. 24 developed markets, the only one that outperformed was greece. quite a number when you think about the economy.
i'm looking at u.s. companies. amazon -- would you like to when you put your fabric softener or detergent and your washing machine and then you run out. mark: it is very frustrating. caroline: a touch of a button, you can order a new one from amazon with a wirelessly connected internet of things a new device. you can put them near your loo. if you have a new baby, if you are running out of nappies, you can get more huggies. i don't think we need any more. this is basically amazon slowly but surely wanting to become everything to us. there will be a day and the future when we open the fridge and the fridge will sense what ran out and amazon will order it. if you are a prime number, it will arrive within a day.
mark: a march rebound for china's factories. a seven-year high in stimulus boost manufacturing. caroline: extending the deadline. iran nuclear negotiators missed their midnight target but russia and iran say a deal is close and expect to start dropping a statement later today. mark: finance officials hold a teleconference today to discuss proposals to release more aid as the ecb holds its weekly review on extending its lifeline for greek banks. ♪ mark: welcome to "countdown."
caroline: also coming up an exclusive interview with brazil's president. she says she would do whatever it takes to meet the country's fiscal targets. there was a budget deficit twice as wide as forecasted. we will have the exclusive interview coming up. it is all about breaking news right now and it is about online only retail. it is about uk's biggest software. profit is looking pretty paltry. for the six months, group revenue was $550 million euros. that is 551 million which is beating analyst estimates. many thought they would come in with 546. they have done better than that and increased 14% when it comes to sales. they have their overall target
quadrupling that. timesing it by five-fold. they have quite a long way to go from there. u.k. sales or where it is that in terms of growth. u.k. sales climbing as well, up some 27%. international sales up 5%. clearly, it seems to be the u.k. is where they are showing their strength. profit forecasts are coming in at 18 million which is a drop of 10%. this is due to having to invest and expand so they are coming under pressure. analysts say they want clarity on potential is of how much they have to give. they had a fire at their business last year. they had to diversify themselves. it is an interesting area because it is a flurry of mna.
an italian retailer -- this is high-end fashion -- they are buying a company which is building the world's largest online luxury goods retailer. they are trying to defend themselves against amazon which is trying to have a dedicated sections. i think it is such an interesting area because in the u.k. there is a unicorn a billion-dollar valuation company. it is a company that are really want to zoom init is driving up valuation. asos, we will see how the market reacts but it has outperformed in terms of sales. mark: a contrasting day from china and japan. china showing signs of recovery on the factory floor. japan's business segment is stalling. yvonne joins us from hong kong.
what is the story behind china's rebound? yvonne: good morning. we are seeing the tale of two economies. some signs of hope from china with this official manufacturing pmi numbers coming out today at 50.1, up from 41.9. 9.9. it was a beat among economists. most were expecting a second month of contraction at 49.7 but that 50 number is the number between expansion and contraction here. that was definitely a beat. keep in mind when it comes to these numbers at this time of year, some seasonable rebound we see after the chinese new year. a lot of chinese workers heading back to work. we will see a boost the production and some economists say that boost we saw this march is not quite as impressive as we typically have seen before here. if you take a look at the employment numbers coming out
from the nonmanufacturing and manufacturing pmi, both of those numbers are coming in at the contraction zone. there is some signs of concern on that front. what this all means -- you may remember that during the national people's conference the premier talked about the government was ready to step in if they see employment slide. if we take his word for it, the might be some more stimulus coming our way. mark. mark: less positive news out of japan today. yvonne: it was a mixed bag we saw. the second quarter we saw confident that these large manufacturers have failed to budge. this survey coming from the bank of japan put it the manufacturing index unchanged at 12 from last quarter. the bank of japan also forecasting that the drop to 10 for june. the big number is the company plans to reduce capital
expenditures by about 1.2% this year. that is despite is unprecedented monetary easing we have seen coming from japan which has weakened the yen losing profits for companies but we are not seeing that cash trickle-down right now. investments falling straight for three months. a slight gain in wage growth with no spring talks underway. taking a look at the nonmanufacturing side, we are seeing signs of encouraging news. they came out at 19 from 17.3 a month ago -- from 17, 3 months ago. the service sector is helping the domestic side of japan. the bank of japan has been very comfortable in taking no action so far in further monetary easing, but these new set of data could trigger some signs of caution. mark: thank you, yvonne. caroline: negotiations for a
deal for iran's nuclear capabilities has passed the midnight deadline. officials say some major points have been agreed but others say the claims are exaggerated. it is a deal that would include the easing of iran's international isolation and sanctions. elliott has flown over to switzerland and is there with the latest. there seems to be some optimism on the ground that a deal could be reached. elliott: there are signs of optimism everywhere. the russian foreign minister actually left the talks a day before yesterday and said he would only come back if he felt there was the likelihood of a deal. he said yesterday after these talks, they adjourned at 1:30 a.m. he said they have reached an agreement on most of the main
issues and that he expects the drafting of a deal to be done today and for them to be revealed. iranians are optimistic and the fact they have extended the deadline another day shows although there is some disagreement from world powers and iran they agreed they are getting somewhere. they are achieving something and inching towards a deal because if they were not, what would be the point of extending it to another day? we have comments from the french foreign minister saying we are making progress, but it is difficult. there are still gaps to be bridged when it comes to the amount of enrichment that iran should be able to do to uranium. what it should do with its stockpiles of already enriched uranium which could be used to build a bomb. most important, the pace of sanctions relief. iran wants sanctions lifted almost immediately. world powers what a phased approach to the lifting of sanctions and have some kind of
mechanism to reimpose those sections if iran is is found to have cheated. these are talks on iran's new glib programs which will resume at some point this morning. they have to have at least some sleep in order to have some productive negotiations. with any luck, we should be seeing the talks resuming in the next hour or two. caroline: they were up relate. we were talking to ihs a moment ago about this and they were saying at the end of the day iran perhaps is not -- we are not going to see is substantial document of agreement later today. we might see some outlines of milestones met, but future work to be done. the real deadline is june, the end of june. what happens next? deal or no deal. elliott: that is right. what is most likely is we will get an agreement but it will be perhaps vaguer then some people had hoped. vaguer than congress will accept
because president obama knows many democrats on his side of of the aisle and republicans are threatening to impose additional sanctions if they don't like what they see in any framework deal that emerges today. that could happen. we could have maybe a framework agreement blown up by congress seeking to impose additional sanctions or we could see this framework deal leading to getting down to the nitty-gritty and such and working towards a definitive agreement which would be in these deals. they will reach an agreement by june 30 and iran will be reintegrated into the world of natiuoons. probably, the reality will lie somewhere in between but the truth of the matter is it really
depends on what comes out today and what politicians both in the u.s. and in ran -- iranians have politics as well and they have to sell it to iranians and the supreme leader. it depends on what we get today and what the side ultimately decide and how they decide to proceed from now and to june 30. caroline: you will be on the ground i'm su re. re. thank you elliott. mark: the sooner the better, the words of angela merkel and francois hollande to. the country has yet to come up with a reform plan leaving its bank reliant on ecb loans for emergency cash to avoid greece's default. lenders are feeling the pain -- they lost deposit for six months in a row. outflows reach 28 billion euros through march. it extended its biggest quarterly slight since its
inception in 1999. hans nichols has been following the developments. good morning. what does the timeline look like? hans: good morning. does not look very likely they will have a deal before the easter holiday. that was the line from donald cusk, the president of the eu council. you saw hollande and merkel saying to speed things up. merkel this saying the saying that talks in brussels was a start but they are not there yet. mr. hollande was a little more critical. as i said several days ago, we lost too much time. merkel said she was not bothered by the plan to visit moscow. she said it is not really mean anything about the european union. merkel may have a domestic issue on her hands. she will be dealing with perhaps going -- peter, the
vice-chairman of the christian social union, the sister party in bavaria. he resigned because he feels he has been pressured to take votes on greece that he does not agree with. he is an anti-bailout politician. this is a little bit of a domestic headache for angela merkel. mark: talk to us about these restrictions on greek banks. what is the european central bank saying about this? hans: the vice-chairman of the ecb's insureds church of a single supervisory mechanism and is responsible. her message to greek banks was to invest cautiously. she did not forbid them from buying. later on in april, there will be 2.4, 2.5 billion euros in greek that will be rolled over. no restrictions on the bank there. banks are under pressure. there are 3 billion euros in outflows in the month of march. that brings the total to 28
billion in greek outflows since october. you have seen the euro react as a result of all this. the worst quarter since the euro's inception. it is 1.07. still quite low. it is good for german businesses the german exporters. overall, there might be some longer-term concerns about what this does in terms of uncertainty in the whole quantitive easing debate we have had a coming out. guys? mark: thanks a lot. i like your shirt and tie nation today -- combination today. caroline: you are like twins. exactly the same outfit. send me the memo next time. moving on -- nigeria has a new president. the former military ruler buhari defeated goodluck jonathan with 52.4% of the votes cast.
he is the first opposition candidate to take the presidency of africa's biggest oil producer since its independence from the u.k. back in 1960. the outcome came after days of disputes and allegations of fraud. meanwhile, iraq is hailing its biggest military victory over the islamic state after recapturing the city of tikrit. the prime minister says retaking control of the city's government buildings is a historic milestone, but fighting continues on the outskirts. tikrit has been under islamic state control since june 2014. 100 business leaders have written a letter to the telegraph newspaper stating that a labor led government would threaten britain's economic recovery. the list of signatories include bp's chief executive and the outgoing prudential chief executive. the chairman of our parent company, bloomberg lp, has also signed it in a personal capacity. they argue the conservative led
government luring of the corporation tax signals britain is open for business, helping to produce growth and create jobs. syrian president al-assadf says he welcomes a dialogue with the u.s. the rules out discussions about an interim government. president al-assad: we will not discuss with anyone regarding what we are going to do regarding our constitution, our political system or our law ors or procedures. fighting the terrorism and making pressure on different countries like turkey and saudi arabia. they support the terrorists politically and militarily. caroline: you can catch that interview 2 p.m. and 5 p.m. london time. mark: join us on twitter. tell us what you are following,
the stories you are interested in and what you want to hear more about. you can always find us on twitter. what are you up to? caroline: #aprilfools is number one. an update on joni mitchell. awake and in good spirits after being hospitalized. keep an eye on wttwitter. mark: european equities heading for the best first quarter gain since 1998. we will get investors' takes on that after the break. stay with us. ♪
mark: let's look at europe equities heading for their best or did have the best first quarter since 1998. for more, we're joined by david, the global market strategist at jpmorgan. what a first quarter, david. we looked at the chart earlier and oil declined with everything else seems to have a pluis s sign. you are releasing your quarterly document tomorrow would give us a sneak preview of the second quarter. david: we see a continuation of the trends that have been dominating in the first quarter. oil and other commodities will remain weak. the bid for six income assets
globally will be in place because of the ecb policy actions and demand for asset costs which does not seem enough to meet it. i still think you can have this reversion to the mean of profit margins we have been expecting which has been helped by low oil and low euro. the credit cycle is picking up in europe as well. we have seen some huge gains in european equities in the first quarter and i think that will continue. caroline: we have seen the autos and exporters really benefiting. the german autos have stacked up more than 20%. which industries have breathing space? david: if you look at the average of auto sales in 2006-2007, before the crisis, we are still far below it in europe. in the u.s., things are back to normal -- 70 million. it has room to run in that kind of front as well.
our equity debts love the banks. if you look at the restructuring you have seen in european banks. look at the bank in germany and in spain and now in italy. the trend of smaller to medium-sized banks reforming merging and improving their return on equity because of that is what is being seen. mark: if the europe keeps climbing into parity in the second quarter -- will you be brave and say it is going to happen? we want bravery. give us a second call for parity. david: it is incredibly dangerous. i try to shy away from it. i don't think the full scale of e cb quantitative easing will fix income assets in europe and therefore the currency as well. i think he will still see this leash effect in the bond curve
where bonds move towards that. a flaw in yields that draghi said he would buy everything as long as he has a yield higher than that. we have not seen that before in a quantitative easing. king did not do it in the bank of england. if you are holding a bond and you can work out that price in relation to the yield, why settle for anything less? i think that will drag down fixed income even more. we love the high yield space in europe. companies a very healthy right now -- low levels. they have performed. we think we can rotate out of the space into high-yield. caroline: the data, i thought we would hear about european companies. tell us about what is happening for the east -- china and jeff apan. china get a slight improvement
in the manufacturing sector. is that showing the potential stimulus is working and people think there will not be any more stimulus going into china? david: the jury is still out on how they can control the slowdown. if you think about what they can apply to stabilize the economy there are some options they don't want to take. they don't want to increase more letting through the state enterprises. they can cut rates to a certain extent, but they don't want to go through another credit boon.l. you look at the currency -- they have aspirations for this to be international benchmark currency. this scale and outflows, they might get if they do. last time, fiscal policy. i think you will see more of that from china. more targeted moves but they don't want to blow up their public sector anymore than it
is. steady as she goes on this lowdown. they have unparalleled control on the economy but it don't think we are going back to the robust that we saw. mark: what about japan? the survey showing there is stalling and companies are not investing as much as many would hope to get the economy firing also wonders. what will that happen? -- firing on all cylinders. when will that happen? david: investment is one, high wages is another. you are seeing evidence of higher wage growth. the labor market -- it is not like our labor market. there is a little more slack than it appears. ultimately, yes you look at the inflation outlook and the gauges, it is disappoint ing. i think it trades down to 1.40. caroline: i want to get your thoughts on emerging markets in general. you were saying look at south
korea, the trade. it is still not where it should be. david: this has been a signature of this recovery. a depressed volume growth in global trade even in relation to anemic global gdp growth. that really harms emerging markets. trade is the lifeblood of growth in emerging markets. korea is a bellwether for the manufacturing cycle, the ecosystem in asia. they are continuing to disappoint. the economy is not as strong as it should be. weaker inflation and interest rates coming from the bank of korea. mark: inflation since july of 1999. david, good to see you. caroline: still to come, we go live to lagos as africa's biggest oil producer elects a new president.
mark: you are watching "countdown." time for your fournette exchange check. we thought we would leak at the euro after the dollar after the euro just finished its worst quarter against the dollar ever. biggest drop since its inception january 1, 1999. this is the chart. it is 11% lower against the dollar. it is still trading above its lows of 104 .94 in march.
according to the analyst we have surveyed at bloomberg, not so soon. the immediate accuweather.com's business traveler forecast the euro at 105. there are a growing number of analysts that say parity is on the horizon. investors bike b. b.v.a., and others all forecast we will see euro-dollar parity this quarter. data released from theism m.f. were interesting. it showed holdings dipped in the fourth quarter, with shares the least since 2002. the u.s. dollar represented the largest percentage of the $6 trillion total of allocate reserves at 62.9%. that is the most since 2008. year to date, interestingingly,
the euro has fallen against all but two of its major 16 trading pairs. they are the brazian real and the crona. the swiss national bank took many by surprise by scrapping the cap. things to watch manufacturing numbers from countries like spain, germany italy, france and greece. in the united states, you have i.s.m. manufacturing data. the euro/dollar down to is.07 after its worst -- down to 1.07 after its worst quarter ever. caroline: google has unveiled two new chrome books. they will feature all-day
battery life. it is promoting low-end lap taps as it looks for more ways to draw people to the chrome system. it is believed that the pilot deliberately crashed the plane into the alps. he informed them of a bout of depression. the first time that lufthansa has acknowledged it was aware of the illness. the death of andrew getti is being investigated. detectives from the robbie homicide division are dealing with the case. you can find more on that story and many more at bloomberg.com. mark: nigeria has a new president.
former military ruler muhammadu buhari defeated goodluck jonathan with 52.4% of the vote. he is the first opposition candidate to take the nigerian presidency since is the 60. but the result wasn't straight forward. the outcome came after days of dispute and allegations of fraud. let's get to paul wallace who is on the ground in lagos. how did the results in yesterday's election unfold? >> on monday night we had about half the results, and buhari was in a strong position. yesterday, as more and more results came through, buhari looked more and more likely to win. but there was a big question mark among people on the ground here on whether the ruling party would accept defeat. they haven't had a democratic
transition of power in its history. it happened around 6:00 yesterday bhep president goodluck jonathan congratulated him on his victory and said that he would step down. mark: and why did the incouple ben, goodluck jonathan lose? >> they have gone through a pretty tough time economically. the fall in oil prices has hammered the economy here. the currency has weakened by almost 20% in the last six months. that is something that has played into the opposition's hands because people are suffering from inflation and other things. he also had issues with his
failure to stop boca raton. >> thanks for joining us. caroline: let's shift gears and look at retail. we had earnings earlier. we have the team leader of the visionary group. give us some visions of what asos is doing? biggest online retailer here in the u.k. profits down by some 10%. is that going to be concerning the market today? >> i think so. i think the strategy strategy that asos has taken up for the 2015 has been very investment heavy. they have gone with aggressive deals, and a target up to $1.5 billion. they are revamping websites,
and this rapid global schangs strategies in markets like china. that is going to affect the margin, and that is not something that investors want to hear. this is great for long-term strategy, but from a short-term perspective it is going to squeeze their margins. maybe the investors -- they are not really showing interest in this strategy in the short term. mark: another internet retailer springs to mind that is investing heavily. amazon of course. >> yes. mark: in the near term, will investors overlook that? the shares have had a horrible ride in the last is it months for various reasons. >> yes. i was following the share price, and i think it fell by 2% yesterday. it is not a great sign. and like i said, it is
essentially because of the squeeze in profit margins. they made a few strategy blunder last year. they had a few unfortunate incidents like the fire at the warehouse which led to losses of 30 million. 20% of their stock parished. from an operational perspective, it showed a few sluggish months, and that is reflected in year-end performance. even in terms of their international strategy with markets like china, they decided to enter china as an independent. they will follow the same strategy. china is crowded with marketplaces like alababa and others, which are places that
feature merchandise from different retailers. i think they have learned from that mistake, and they have announced that they will be featuring their merchandise on t-mall in china. these are some lessons they have learned from the past year. also in terms of the pricing strategy, they slightly missed the mark last year. they have been following a single price strategy, which means all of their goods will have a price across the borland. that is not a model that will always work. if there is any kind of appreciation in your base currency, the pound sterling, it is going to show in higher prices. when you are trying to sell -- the core value proposition is to sell to to-somethings who are price conscious. their idea is to offer wide
labor else for big brands. if you see a celebrity and like what they wear, you can click through, and they create it for you at a low price. that is their business model. when you are trying to attract value conscious consumers and follow a pricing strategy like this, in the international market you are still a dealer charging high prices. now they have adopted a zonal pricing stajan. they were supposed to follow it last year but did not. i think they were supposed to launch it in june but haven't so far. when that kicks in when differential pricing and dynamic pricing kicks in, their international markets will start to show progress. it is a market they need to focus on because they are facing pressure from international markets. caroline: he said he is confident in the second half.
mark: did someone bid for it? there was speculation last year that it could be a target. caroline: yes. >> they actually announced that they are merging. it is an interesting combination because there is so much synergy between what these two companies too. it is selling off-season products and stuff that has been overstocked. the other one is a luxury brand retailers. they work like an online catalog. you feature the products on models. the website looks and feels like an online catalog, and you can click through and buy what you want. the only difference is this.
they feature several high end brands in there. mark: thank you. >> my pleasure. >> team leader of visionary innovation research group. caroline: up next, it is his favorite team. he is an addict to these charts. treasuries tend to rally in april. stay tuned to what he has up his sleeve for you today.
mark: welcome back. time for today's bar chart. treasuries tend to rally in april. i want to thank my colleague who has written a piece entitled "no joke, u.s. treasuries tend to rally in the belmont of april." perfect bart chart material. they have advanced every april from 2010 to 2014. that is according to data at bloomberg. check out the chart. this is the bloomberg u.s. treasury bonds index. it is a gauge of u.s. government bonds. contrary to many forecasters, it is rising in 2015 meaning that yields are deadlining. year to date it has returned 1.8%. the first quarter gains were the fifth consecutive advance the longest since the series
began in 2010. the peak, that green circle right there, was on january 30th. that was a record. right now the index is about 1.it% below that record. the 10-year yield finished the quarter at 1.92%, starting the year about 25 basis points higher. it is fooling strategists who predicted it would rise %. the average forecast was for an increase of 2.55%. that was the forecast at the end of 2014 for 2015. i am digressing. getting back to april, why have treasuries risen this month every year? one theory is japanese investors are buying as they
begin their fiscal year on april is. kay has noticed the trend, driven by higher yields than those available in japan. he says before the end of march or the first few weeks of april, the new positions are set for the first few weeks of april and there may be buying pressure in treasuries. 10-year treasuries yield about 1.5 percentage points more than the security bonds in japan. that spread, though, is less than the average over the past decade of two percentage points, reflecting demand for u.s. securities right now. there you have it. it may be april fool's day, but you would be no fool betting on an increase on u.s. treasuries in the month of april in the past shall years. will this april prove any different? caroline: well, moving on the
italian billionaire family is looking to shake up their $11 billion empire. that is according to someone with knowledge of the matter. the news coming a few days after they sold their stake in the airport. devin, tell us a little built about the family? i know them for their shop on the high street and the clothes they offer. they have plenty more assets. >> they are best known for their name sake retailer, but they have invested elsewhere. a lot of emphasis on infrastructure in italy and service companies, particularly those that service the infrastructure industry. >> basically where you want to go an eat in italy. >> how after they innovated with their beffetton stores? >> they were one of the first to get into that model of fast
fashion, keeping costs lows and franchising their stores so they could expand quickly. caroline: what about the colors? it is not enticing. they don't seem to have the trend way of clothes. they have great models. they oaf ten use the model of the time but they don't seem to be winning in terms of product sales. >> yes. i haven't stepped "inbusiness" a decade. there is a lot of competition now from the other companies. they are not as well known. they are trying something new. they are organizing some of their stores by color. they are trying to set themselves up by color and product. caroline: so an entirely blue storey? >> yes, or by section, a red section. they had a provocative ad
campaign with couples. they are trying to make their stories appealing as their marketing. mark: i remember colors set them apart years ago. >> exactly. one of the siblings got started when she made a blue sweater that caught the attention of this retail store. caroline: tell us about the shake-up we could then expect? they have been selling off world dutyy-free. is it mainly united colors of bennetton they are looking into? >>ier, they are looking outside of italy, and others are piling in. pirelli is bought up by chinese buyers. it looked appetizing. >> yes, i think they are concentrated in italy. they are obviously going to be interested in wealth preservation. but their problem child is the united colors of bennetton.
that is probably where they are going to be putting most of the proceeds from this sale of world dutyy free, but they are going to be look to go invest outside, too. they have been tight-lipped about exactly where tyler going to invest. caroline: thank you. she is our bloomberg billionaire's reporter. mark: let's move it on. we are about nine or so minutes away from the start of today's european equities session. here are the top stories this hour. nigeria has a new president former military ruler, muhammadu buhari defeated incumbent goodluck jonathan with 52.4% of votes. he is the first elected. the outcome came off allegations of fraud.
they have recaptured the city of tikrit, the 0 miles north of baghdad. they said taking control of government buildings is a milestone. tikrit has been under islamic state control since june of 2014. >> 100 business leaders have written a letter stating that the labor-led government would threaten britain's economic recovery. the last of cigarette tours -- cigarette tours of several. the authors argue that the tax signaled britain was open for business. the syron president says he welcomes a dialogue with the u.s. but ruled out discussion
about an interim government. he spoke to charlie rose. >> we are not going to discuss with the americans or anyone regarding what we are going to do with our political system our constitution or laws or procedures. we can cooperate in regard to fighting terrorism and making things on different countries like turkey and saudi arabian others that support the terrorists. mark: you can catch that interview in full at 2:00 p.m. and 5:00 p.m. london time on charlie rose. caroline: now bloomberg spoke clufle with the brazilian president, and she says she will do whatever it takes to meet the cup's fiscal target. that came hours after surprising analysts with a budget deficit twice as wide as forecast. let's listen to the conversation.
>> the country's budget was passed about two or three weeks ago. it will be submitted to us with all of its complex underlying structures for us to sanction or approve. and then we are going to introduce the adjustments to our own government spending. we are not able to, of course, solve the problem by cutting down on personnel or payroll. but rather by expenses. we will have to rationalize our government spending. we will probably have to reschedule other types of spending. we will have to resort to several mechanisms, and that is where the government steps in. we will establish a number of budget cuts. we will not lower our social policy efforts at all because it is not the one element in the agenda that comes there from the gymnast majority of spending. what we will do is we will streamline all administrative activity in the government.
we will streamline the government spending pattern. we will rationalize spending and keep on doing what we have always done. there can be no successful social policy if one does not revisit the policy regularly. caroline: that was routsseff speaking. i am getting mixed calls. some say it could be flat, and others as high as 5%. sales up 14%. really strong growth in the united kingdom. they are still saying that we are confident of the second half. they had real problems before they had a fire in their distribution center. investing heavily, profit coming down, but they say our target of two and a half billion pounds, they are not going to reach it until 2020, but 2.5 billion compared to a
manus: -- anna: good morning and welcome to "on the move." we are moments away from the start of european trading. chinese stocks soared to seven-year highs after manufacturing data beat estimates as the people's bank of china signaled a possibility of even more easing. what will stop the shanghai composite? a record quarter. european stocks outperformed in 2015 with their best run in six years. the euro as its weakest quarter since its adoption. will greece get another lifeline? the ecb considers extending emergency liquidity assistance as capital leaks away from greek
banks. eu officials discussed the latest proposals from athens. that's what we are watching as morning equity trades get underway. european equity markets just springing to life. let's check in with caroline hyde at the touchscreen. caroline: they are opening as we speak. it is likely to be a bit of a down day. there is no joke about that despite the fact that it is april fools' day. best quarter in europe since 2009. the longest stretch of quarterly gains in the united states back to 1998. we've had nine straight quarters of gains on the s&p 500. global stocks touched record highs. we are seeing the ftse opening basically flat, but france off by 0.4%. we are looking for germany to spring into action as well as spain. there is a little bit of mixed