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tv   Countdown  Bloomberg  January 28, 2016 1:00am-2:31am EST

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anchor: the u.s. central bank remains reserved. anchor: the biggest investment weathers the storm. anchor: and another sales record as investors like what they see. anchor: welcome to "countd9own."
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anna: a lot to talk about. manus: the market has moved. there is a lovely line in our story. -- this trying to find was the close of business at the end of december. the market was saying 52% probability of another rate hike. the line in the story is about a soft backpedal. they are monitoring the economy and discussing the implications for the labor force and markets. anna: it was a fine line they had to walk. if you look at whether they spooked the market, it rallied well stable itbating how was. weakness in the chinese session. : one thing that caught my
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eye, dollar volatility. it was the least a volatile session in the dollar against 10 currencies and since june, 2014. all eyes down in terms of volatility. u.s., 15.1s in the -- we will talk to our guests against -- about that. manus: one of the biggest pharmaceutical companies. iny delivered the 5% rise terms of the sales. this is on a exchange basis. of other lines, the dividend comes in at 8.10. the estimate was 8.40. a little bit more concerned on the dividend. sales rise 5%. the court earnings, excluding
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one of their drugs, came in at 13.49 swiss francs. at full earnings come in 17.5 billion swiss francs. anna: keep an eye out for deutsche bank. anchor: they have opened the door to the outlook for their economy and possibly a slower pace of interest rate hikes. they are monitoring developments well access during this accessing their implications. --gan stanley says technology there are risks for the economy. investors are going to the relevant -- relative safety of government debt.
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oil has fallen for the first time in three days. that is after a record that exacerbated a global glut. russia has talked down the prospect of working with opec to cut output. facebook shares stored in extended trading after delivering a another quarter of a record revenue. point 6 billion users logged on every month. about 80% of revenue came from mobile devices as facebook continues to sell ads across its spectrum. by our 2400 powered journalists around the world. i am nejra. anna: let's get a look at what the markets are doing. shery ahn is standing by. weakness in china? are seeing a bit of a
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mixed picture across asia today. today, markets recovering some of the losses earlier. some swinging between gains and losses. the nikkei did not manage to sustain those earlier gains. we have retail data showing this morning, it missed estimates and fell and stead of unexpected rise. --estors cautious ahead china, as you mentioned, the shanghai composite, losing ground for a third consecutive day. the hong sang is one of those markets moving between gains and losses all morning. currently unchanged. the philippines up 0.8%. i mention them pegida -- today because we have gdp estimates. beating estimates, growing 3.2% on the year. today, samsung falling
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after missing estimates. the asf 200 up. new zealand gained 0.1%. we had the central bank leaving the cash rate unchanged at their 2.5%. signaling it may cut a rates further in order to boost inflation. kiwi dollar plunging. now it is recovering, up 0.3%. anna: -- debating whether this means a great deal when you look at hong kong. we'll talk about banks. waiting for the deutsche bank numbers. we are expecting a full-year loss. this is down to there is a cracking line about the investment bank. record low levels of risk taking for the bank. he has a huge job ahead of him,
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doesn't he. guy: he does. we will get to those in just a minute. let's go through the details. they have given us a rod brushed picture. we have a problem, particularly at an operating level. which divisions are performing badly? we need details as to what is happening. capital target. by 2018.king for 4.5 the question is, can he make that number without raising money. that challenge is going to be difficult. we need the bankers to perform. going to, we're going to have an issue. anna: we will let guy keep an eye out for those numbers.
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we will have an interview coming up at midday london time, 7:00 in new york time. guy is there on the ground is talking to this man later on. our next guest says the european banking sector is planes kept up -- catch up. good morning. we are waiting for the deutsche bank numbers. essentially, enormous in investment banking. that is a sector many have been pulling back from. >> you see some banks in the u.s., wells fargo is a good example. their investment in investment banking. part of what you are seeing is u.s. banks done with the crisis quickly and sharply. our financials is one of best because capital cushions are so strong.
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amount ofimproved the business they are getting. with europe, there is an amount of catch up. maybe they didn't deal with the crisis quickly enough. manus: the essence of this is, desperate the reality is, choose your speciality and be a victorious person. jpmorgan still has a big model. they are more efficient, someone would say, than other businesses? wholet going to read the thing. it is creating a mode. where is your island? these things go in cycles. we saw a breakup. various things going on. or 15 years from now, we will be having a conversation because universal banks have come back.
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they are surprised by how hard some parts of their business have come back. anna: one thing, the performance of the investment banking. also, what they have to say in january.rkets things were tough. share prices of these banks in the fourth quarter of last year, \/ -- theyarguably,]\ have arguably become tougher. >> they excited some degree of asset repricing. this is what we are going to see. banks are committing more and more. it comes down to central banks. manus: let's get you up to speed with your date ahead. eurozone consumer confidence. afternoon, german inflation data as well as u.s.
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.urable goods orders manus: coming up next, change of tone? yellen in the fed indicate a lower case of rate hikes. that is the discussion. ♪
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anna: welcome back. let's get to bloomberg business. shares soared in extended trading. profit beat estimates of 1.6 billion users. about 80% of revenue came from mobile devices. using video. >> video is an important part of the facebook experience. continuing to invest is an
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important part of the loan people to share in gauging content. now, 100 million hours of video are watched daily on facebook. samsung is falling after missing estimates. well belowfell 39%, average forecasts of $4.5 billion. they have joined apple in warning of a tough 2016 in the tech sector. paypal host -- posted fourth-quarter revenue that beat estimates. ebay saw sales stall as sh oppers went elsewhere. results indicated carl icahn's plan to split them. for their drug
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continued to grow. sales increased. that is your bloomberg business flash. manus: the federal reserve chair janet yellen and colleagues have opened the door to change in their outlook for the u.s. economy. interest rateof hikes. anna: they said they are closely monitoring global economic and financial developments well assessing their implications for the labor market and inflation. you are what some leading voices told us about the path ahead. >> there was a concern inflation is not going to get back to the 2% goal. they said they started to move because they saw they were reasonably confident it would get there. what we have seen, changes in expectations that have come down , the markets are not so sure about that. that might slow them from moving forward rather than speed them up.
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>> they changed their balance of risk assessment in a novel way by basically not saying anything about it at all and shifting the language from having a view on the balance of risk to remind us they are going to look at these things. that is going to impact the balance of risks. >> we think it is going to be more aggressive in july, august, september. not so much in the first part of 2016. the fed is taking a somewhat longer view in terms of inflation. anna: we are getting numbers from deutsche bank. let's talk about that. deutsche bank, q4 net revenue has come in at 6.6 4 billion. at pretax loss has come in 1.15 billion. the focus is on the investment bank. they have reported a loss at the investment bank. a loss of $1.5 billion.
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just trying to find any other key details in here. the headline so far, the ,nvestment banking pretax loss a lot of focus on that business. guy johnson has been waiting patiently and is still with us in frankfurt. of task to reshape that part the business, guy. guy: we are waiting for details on what happened within that division. why the loss has occurred. the investment bank pretax loss billion. which divisions performed badly. remember, deutsche bank is strong in areas such as fixed income. what has been going on in terms of the details we have? ier one ratio, that it
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is a drop. by 2018. target of 4.5 if the bank is not generating target is looking further and further away. the other question people are going to be asking is is the to6 sale or likely ipo going be pushed back? the story in frankfurt is that is looking likely. not only because of what is happening in deutsche bank but the market. that is going to make it harder and harder to push the number out. that is a critical part of the equation. we need details, a lot to be broken down in terms of what is happening with the litigation. how does that break down? to the deal?e wisely number in now? give us details. moment, ct one is a problem.
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the loss coming out of the investment inc. is a big problem for john cryan. the investment bank, pretax loss, equity origination, debt origination, 1.8 4 million. we need more details. those are starting to come through as we breakdown numbers. what happened within the investment bank and the ratio. with guywill back later in the day. let's bring back into the conversation the managing director at charles schwab. we were going to talk to about the fed. assessment, post the fed statement? comparing and contrasting this with the previous one. >> it seems march is likely. we are with the market consensus.
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they are going to have to dial it back in march. february, you have janet yellen speaking to congress. we will get a better read then. ultimately what the fed are trying to do is a path of normalized monetary policy. i getting involved, it will only increase for toady. the markets sold off yesterday because of a degree of risk. these global factors are going to affect the two main mandates. that is what concerns them. menace: what we do here is we produce for our viewers, it looks little like wallpaper but the obviously goes into second big paragraph. what they talk about is the risks. to the labor force are balanced. that is gone. we have gone up a scale in terms of the monitoring. what they are looking at come the balance of risks, the
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applications for the labor force. they are going to closely international developments. i love the story we used about a soft act pedal. the dollar was the least volatile sense any meeting in june, 2014. the dollar isn't going to strengthen as much as you would expect. it is hard to see where the reversal will come from. say -- ould >> it is more dovish, especially on the inflation side. they are talking more about inflation to concerned about long-term inflation. they pedal back on what they believe is the natural rate of unemployment would was which they brought back to four point 9%. that is important for inflation
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because it affects wages. anna: it was previously about inflation expectations. theeard them referring to need to see inflation being evidenced in the data. >> they have been talking about inflation in the transitory factors. they are stepping up that concern just a little bit. menace: i wonder -- that affectspect inflation is wages. we are going to get an index that shows 2% wage growth in q4. wages, we think, will continue to play an important role. aboutsses are talking labor tightness which obviously will impact wages as well. we are talking about low inflation. it could surprise us. we also have oil prices being low. it takes about 12 months for the impact of oil prices to be felt.
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cohen sumer's are smart, what they have done with the money they have received. they are spent in saved about a third. they used some of it to pay down debt. other factors, affecting the economy positively. manus: stay with us. we have more to get to. ours -- we are joined by economy reported to read great to see you. you have covered the fed for many years. you probably read more of the statements than even me. that would be saying something. >> it was interesting this month. a communication challenge. they needed to get themselves in the room to maneuver. they had to a knowledge risks have changed since the december meeting. i think that is what they did with the statement. there arenowledgments not general risks. it is less balanced than
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december, but they did not sound huge warning bells. the optionemselves to rise in march should conditions wart it. anna: what about inflation, whether they are getting dovish around the inflation question? >> it was really interesting. prices have declined so sharply which has put a damper on u.s. and in the globally. what they acknowledged in the statement was the short-term out look for gas isis, as gas prices continue to fall, the outlook is not so good. it is not going to rise. they are maintaining the idea that these gas influences are transitory and eventually into the medium-term we are going to see inflation move back up. anna: -- manus: thank you very much.
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fx,e look at equity bonds, would equities decline? the question is bonds. yield,ook at global bond global long yields, they are extending their drop. low inflation. this month.e winner will that continue? how do you look at asset valuation? with equities, one of the cases has been valuations. we talked earlier about the valuation of the s&p 500 coming back. i would argue equities are a good place to be. anna: we will talk more about this when we come back. years,rage over the 25 compared to the last 25 years -- i will get e-mails now. thank you. sp next, facebook make friends with investors.
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we will break down the numbers. back with further analysis of facebook. ♪ the only way to get better is to challenge yourself,
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and that's what we're doing at xfinity. we are challenging ourselves to improve every aspect of your experience. and this includes our commitment to being on time. every time. that's why if we're ever late for an appointment, we'll credit your account $20. it's our promise to you. we're doing everything we can to give you the best experience possible. because we should fit into your life. not the other way around.
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it is 6:30 in london. loss for annual deutsche bank since 2008. anna: deutsche bank reporting a loss at its in basement bank in the fourth quarter. the fourthnt bank in quarter. the loss, 1.1 5 billion eurozone the fourth quarter. that is according to the statement from the company.
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you are talking about a fourth quarter revenue. this is on the division. the bottom line is, it is a huge bank. taking the lowest amount of risk since 2011. >> we look ahead to q1. investors want to know how much theturmoil has reduced demand for services. to news. to thethey have opened change in the outlook for this u.s. economy. they said they are pulled closely monitoring economic and financial developments will quote assessing their implications. morgan stanley says bond
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investors should favor long-term securities. prices for stocks and crude oil are damping inflation pressures. long-term bonds stands to benefit most. oil has fallen for the first time in three days after u.s. crude stocks files expanded for a third week. russia has talked to down the prospect of working with opec to cut output. the bank of japan -- if they failed to rein in the end. he said policymakers need to step in following the currency's six month arise. global news, powered by journalists in 150 news bureaus across the world. m they rest chamber. i am nejra.
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anna: caroline hyde is here to break down the numbers. impressive numbers. tooline: you have to hand it them. reversing the slowdown, 40% growth in sales, they have a ramped it up to 52%. revenue pushing away. crammed i the u.s. dollar. the u.s.d up by dollar. doubling for the first time. more than a billion dollars in quarterly profits. what a way to go. mobile devices of really worked for facebook. 80% of their ads are going on mobile. they dooo! and google, not get as much bank for their buck. goes in your newsfeed. they charge more for that. when you look at the stats who is using it, 1.6 billion users per month.
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100 million videos a day. that is phenomenal. nor the shares topped 12%. any new product's are where the excitement is. instagram, this is the first time we saw a full quarter of them. anna: we look at the futures for u.s. equity markets. manus: caroline is running through the numbers. excited about a great new story. is facebook having its apple moment? i am looking at the market caps. apple's stands at a $500 billion. facebook, to $67 billion. 267 billion. they have reached nirvana. charge highe to advertising on mobile.
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it impacted their business. i'm caring that -- comparing that moment. >> that is what technology is about to the next new thing. knows what the next facebook is. have gonespot -- they through this fantastic change over the years. 80% of companies in the technology space were semi conductor. now 50% of revenue comes from services and software. inch is much more stable terms of revenue generation. dividend yield has gone from 1% over 10%. to 1.5%. -- over 10 years to 1.5%. the amount of money they have on their balance sheets is similar. management at facebook as well is more mature and doing the right things for a longer term. get: it is interesting to excited about dividend yield
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going from 1%. >> that is what we are seeing with facebook. it wasn't long ago, they could not get the numbers. and now they have. caroline: what everybody is worrying about with facebook, the -- apple they only have one killer product. manus: it is very reminiscent. i cannot do anything less than one billion users. it is a critical mass number. caroline: you need celebrities. businesses. >> this is what apple said as well. one billion units out there. it is a bit misleading. if i own an iphone and ipad and a mac, that is three units rather than one person to read it is still a big number. apple said the same thing. : they get them to a
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critical level, one billion. before they refocus on money. caroline: we are starting to see essentially, they are monetizing instagram. advertising. 98 of their main top companies advertise on facebook, using instagram. they convert that so quickly. can they do that for whatsapp? some businesses are starting to use whatsapp. monetization of that? >> look. i was just about to say, can we get off the excitement train? they are going to blow the bank. this is interesting. the oil industry, if it collapses, the mining industry, -- >> $4.5 billion. >> we think there is a pent-up capex need.
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manus: from tech or generally? >> a lot of the computers are getting old. they have held back on suspending. capex spending. factoriesking about and machinery. it cannot be held back much longer. manus: that doesn't necessarily translate into jobs. you can create uber with a fleet of people on contracts with no huge industrial base. to theot translated traditional model. that is why we think we are in groundhog day. >> but you get more productivity by investing in technology. caroline: they are spending up to or .5 billion dollars, into ai and virtual reality.
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waves of people within their offices. buying actual hardware, it is people looking at the future and what for jewel reality can contribute. their spending is phenomenal. the next billion people in india and asia, getting on the internet. argument. the same when computers ended up on desks, we were worried people be put out of jobs. the same thing will happen here. new jobs will be created. anna: thank you very much. the latest on facebook. up next, deutsche bank. manus: more deutsche bank. a loss. first full-year loss for the bank. 6.8 billion eurozone and the first annual loss since 2008. we break the numbers down. ♪
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anna: let's get to bloomberg business. nejra: samsung shares have fallen. net income fell 39%. well below analyst average forecasts. samsung has joined apple warning of a tough 2016 in the tech center -- sector. paypal has posted divergent earnings results from ebay. they attracted new customers and processed more online payments. ebay saw sales stall as shoppers went elsewhere during the holiday season. the results validate how i can icahn's plans
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just that led the company's up. europe's largest company says sales increased. has reported a loss to its investment in bank. overall, they posted a net loss. the first annual loss since 2008. don't miss our interview at noon. that is your bloomberg business flash. manus: let's get to guy johnson. it is a raft of numbers. what is the main question for the interview you are going to do today? main question is, can you avoid raising money? it is as simple as that. if you get those kinds of
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numbers and look at the corporate banking and security sheets, look at it every single line, every single business within the investment inking by three.down to it every one of those numbers has a percentage of brackets. if this is looking anything like this, it will be difficult to avoid raising money. that number has dropped to 11.1 this time. they are guiding already, q1 could see the number depressed before picking up again. can he avoid raising money? that is the question. manus: thank you very much. look forward to the interview later. guy johnson in frankfurt. to a managingt director. cannot avoidy
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raising money? is that the key question? an important one. capital has been tight. the loss, clearly arose the cushion may have. they have to plan to sell their which shouldly give them an injection. change their capital ratios a bit. strengthen them. so far, the expectation on our side will be that they can avoid a raise. currently, weak results like the fourth quarter will not make the case easier. manus: there are two lines. assets as flat. surely they would want to see something more substantial in terms of reducing risk wage
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assets. they talk about litigation costs below the prior year level. these are two could go points. is one focus costs area for them. strategy, they clearly addressed that. the last few years, the bank was actually profitable on a reasonable level but then every year, every quarter, there are big litigation charges. trying to bring that down is an important focus for them. litigation always dealed with the past and things they already have. litigation is about not making more mistakes and trying to do things better and more cleanly. the rest is just a matter of time and working through past issues.
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>> talking about the future, in terms of the amount of risk of they are taking, specifically around the investment bank, when you look at the amount of money they are putting in, the capital, q3 average value, at their investment bank, the lowest since published data in 2004. what does that tell us? it tells us a lot about the strategy they have adopted. rolling back on the previous strategy. are they recharging too much? the right amount? >> that is an important question. it goes into the hole issue. if it is revamped, being attempted, cutting at the right corners. that is a very valid question. fourth quarter seems to also be. the first quarter, basically, trying to implement the new strategy. bank isseem like the
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taking its foot off the gas pedal. if the concern clearly is there arehis cost-cutting drive, they cutting too much? damaging the franchise? cutting at the right spots? manus: they will want to see a substantial move and address some of the issues. --you are not going to reorganize the bank. great step of the day. maybe anna found it or a producer. shout out for all of her. oliver. twice the size of the greek economy. billion euros 400 in assets. a huge slab of the economy.
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stocks below their fell you. -- value. someone say this is the opportunity of a lifetime. we have graphs for our viewers. how do you look at it? the low book value? or for there to go? or further to go? >> it indicates some issues around the bank industry. growth the question of story had facebook. manus: these guys are below par. bank, --tsche .> there is very little growth maybe shrinking in fact.
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it becomes a dividend play. many of these, deutsche bank and barclays -- manus: there'd dividends are the same class as deutsche. ratio --to book anna: 0.037. as you point out in your notes, this is the market telling the banks to do something different. >> very clearly they have large operations. fixed income is very capital consumptive. it does not seem to be there for the time being. manus: she is not going back to the marketplace. she has emerging market risk.
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family ofook at the europe and u.k. banks, how do you look at the risk reward? >> the u.k. banks? manus: russ mcewan, he has knocked off more money. people questioning his ability to deliver a dividend. the u.k. banks, it is turning prospectively forward into essentially a dividend story. the regulation is constraining the banks very strongly in what they can do. credit, not great. once we come through all these legacy issues like rbs is trying to do on accelerated basis, we expect them to be nice steady -- >> growth in the u.k. economy
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relatively good. what about, a quick word on the peripheral banks. we saw a lot of nervousness around the periphery of europe nonperformingl of loans. the fate of some of those peripheral banks. that is something that has legs to gain momentum? or something with the formation of a bad think in italy is being dealt with? >> for me there are concerns with banks. extreme and overdone. the new reality is banks can fail. bondholders can take losses. that is very clearly the case. at the same time, asset quality in italy if anything has been stabilizing over the last six months or so. to suspect for some reason, the
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ecb having done the quality and then toss test, come in and demand huge amounts of new capital seems a little -- manus: thank you for coming in. the managing director. anna: the interview with cfo, middayk's london time. manus: let's take a look at another event we are going to keep our eyes on. investors and analysts predicting south africa will hike just rates by 50 basis points as the revenue and reserve bank fights. anna: let's get to johannesburg. a reporter is standing by. will there be a hike there? how big? >> good morning. well the market is expecting a
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rate hike, we have seen the chancepricing in a 64% of a basis point hike. over 100% for 25 basis points. the markets saying the reasoning hike, the 50 basis point having such a highly chance, the market is expecting the reserve bank will try and hone in the rand and have a more aggressive approach to monetary tightening. there any sign of the rand returning to help? you must have every twist in the world running to cape town at the moment. the value is extraordinary. reporter: manus, yes. the rand has reached record lows. even earlier this month. beenollar rand trade has getting negative returns over
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the past years. 5.7% just thiswn year. increases may not be enough to pull the rand out of the slump it is facing. investor sentiment is going to play a pivotal role on whether the rand can carry through and not reach anymore record lows. anna: thank you very joining us from johannesburg. you are going to make people in europe uncomfortable. january in london. manus: i would rather be on the beach with a very large glass in my hand. anna: if you can't get there, we will take you to winter in europe. it has been amazing, the phenomenal rise. up next, a slew of earnings here in europe. h&m. manus will be loading up the
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terminal, looking at those numbers. the facebook surge after hours. that could play into the u.s. futures. a little stronger at the start of trading day. see you in a minute. ♪
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to global risks lower the chance of a hike in march. anna: deutsche bank drama. the largest german lender reports the first loss since 2008. itus: as facebook figures out, and other record propels the stock higher. i amme to "countdown." manus cranny. we have a raft of results. anna: results coming through. looking for numbers from diageo, -- >> you are going to keep an eye
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on those. the fourth quarter sales. that is a mess. the dividendin -- comes in in line. operating loss, swedish krona, narrows. 202 swedish krona. loss, 385.ted a president and ceo maclachlan is going to be on. in at 124sales come billion swedish krona. anna: i can't see it contribute. let's talk about another business. , the number one
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distilling business. their number comes in at 5.6 billion pounds. broadly in line of the estimate, 5.7 billion. operating profit come a 1.7 2 billion pounds against an estimate of 1.7 8 billion. organic net sales growth, that is a factor. dividend coming in as expected. the stated strategy has been to focus on emerging markets, away from china, where they have seen a crackdown. other parts have been to the four. as the ceo has been talking about, 20% of sales would come from emerging markets. always interesting to see how they are doing. first time organic net sales. the estimate was 1.6%. that does look to be ahead of estimate. a lot of challenges for the business in the u.s.. have some of their drinks lost
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youth appeal? ofwill talk to the ceo little later. he will be joining us on the in "on the -- move." manus: what constitutes youth approval? they see western european markets going to-3% in 2016. they see 2% growth in eastern europe and the u.s. market growing by 3-4%. quick check on futures. futures indicated lower. by 45 points. a repricing. through aftering hours. that potentially, adding to some
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of the sentiment. anna: the s&p, price-to-earnings ratio. compared to the average in the last 25 years, trading below the average of the last 25 years. let's go to caroline hyde. caroline: deutsche bank has avoided a fourth-quarter loss in its investment bank. as revenue fell. the bank posted a net loss. sincerst annual loss 2008. do not miss our interview with the deutsche bank cfo at noon u.k. time. janet yellen and her colleagues have opened of the door to a change for the u.s. economy outlook. slower pace of interest rate hikes. they say they are closely monitoring global, economic, and financial developments well
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assessing applications for the labor market. facebook shares soared after delivering another quarter of record revenues. they beat estimates, 1.6 billion euros -- users logged on. revenue came from mobile devices. ubs has some words of caution for investors, betting the shanghai composite will opt at 2500. so sands of companies -- tocks sword. ared -- stocks soared. get how markets are performing. shery ahn standing by.
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less time we talked, things look to mixed. some markets recovered from earlier losses. so far, china not looking great. the composite in shanghai declined for the third consecutive day. now, the lowest level since november. another rough day for the home saying -- hen sang index. it did give up gains. same thing happened for the pan with the nikkei finishing down. retail estimates missing. caution among investors as we have the bank of japan decision as well as the sensitive price data coming out tomorrow.
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it finished higher, 2.5%. missed estimates. new zealand stocks slightly higher, 0.1%. we have the central bank keeping rates steady at 2.5 cent but signaling they may cut rates further to boost inflation. in hong kong way so keep an eye on the macau casinos stocks because analyst are giving them the thumbs up. china, upgraded by jpmorgan. it different story for smartphone makers in asia with ripple's results showing through the markets in asia. and anna? manus: thank you very much. shery ahn in hong kong.
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anna: janet yellen says they are monitoring developments. here are what some leading voices told us. >> there is a concern inflation will not get back to the 2% goal. they started to move because they were reasonably confident they would get there. what we have seen, changes in expectations that have come down, the markets are not so sure about that. that might actually slow them from moving forward. >> they changed their balance of risk assessment. shifting the language from having a view to remind us they are going to look at these things and that is going to imprint -- impacted their balance. >> we think it will be more aggressive in july and september. the firsth in
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part. the fed is taking a longer view in terms of inflation. manus: our next guest says the central banks are right to be restrained. he is the global head of being priebus strategy. our last guest said it was a dovish statement. i like the statement that it was a soft backpedal. they are worried. >> which central bankers do, if the markets are jittery, they say calming things. what we had is another poor performance from stock markets. is, is this is a
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signal for a slowdown or just what you would expect at the start of a tightening cycle? all financial assets reprice because the discount rate is going up? why would that be unusual? that is perfectly reasonable. veryfore the price is sensitive. >> it has been a global story. the way the u.s. story has influenced all kinds of asset classes. we are seeing some of that unwind. >> that is absolutely right. that is why the selloff can be so severe. they have spent the last number of years pumping cash into the
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system. are to take a complacent they have been pumped up. the question for the fed, if that is going on, it may still affect the economy. doingthe markets might be the job for them. >> they have changed their view from three to two. the worst month for stocks according to the papers.
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the worst month since when? august. it is not such a big fall but i guess the thing is, what happened in august? manus: our brains are not wired for this kind of drop. of the value of your wealth white, you would be stressed. iped, you would be stressed. is frome got for you high to low. .lobal sovereign yields let's talk about that first of all. oil is not coming back. global sovereign yields. they are at their lowest level. .88%. you are going to clip my wings and say this is nothing to get
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too concerned about. aboute through the story sovereign yields. there has been a flight to quality. the whole world is flocking to bonds. rotation outbeen a of risky assets. last five years when rates have been locked down at zero, that has been the only story. there is a sector rotation. the idea that rates might be on the move, dynamically, means this is not the only game in town. if i may. preparedre is one i earlier. >> this is the real yield. we have had aad collapse in nominal bond yields. movedal yield has not
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that much. that is because yes, the market is worried. it is worried about inflation. oil is going down. the real yield is still well above what it has been since the end of the taper. in is back you saw how low those real yields went in 2012. since then, we had the taper tantrum. we came back down. that has not yet altered. the worry for me is the market goes, you know what? we the fed would be on course. the bond market can change but the market, they
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are saying, real yields are not going back down. anna: good to get your thoughts. manus: up next, we are going to speak to a company that calls itself -- you will like this -- the oil world taxi driver. find out why. ♪
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anna: welcome back. let's get the bloomberg splash with caroline. caroline: deutsche bank has reported a fourth-quarter loss. overall, they posted a net loss. the first annual since 2008.
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do not miss our interview with the deutsche bank cfo at noon u.k. time. facebook shares soared in extended trading after delivering a another quarter of record revenue. estimates beat expectations. they continue to sell more targeted ads. >> video is an important part of the facebook experience. and you doing to invest here is important to allow people to share and consume some of the most exciting content. now, 100 million hours of video i watched daily on facebook. caroline: that income fell 39%. well below analyst average forecasts. iny have joined apple
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warning of a slowdown in 2016. h&m missed analyst estimates. pretaxpresta missed4 -- estimates -- unseasonably mild weather in germany also contributed to the weaker profit performance. bloomberg business splash. manus: with oil hovering around a 12 year low, let's speak exclusively to the ceo of one of the owners of an oil supertanker. welcome to bloomberg. great to have you with us. tell us about your numbers. you are one of the few people we get to speak to that say, i love cheap oil. >> it is absolutely true. essentially we sell freight as a
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commodity. we sell oil in the largest units. the way we do it, negotiating a lump sum. the cost of the fuel in moving the cargo from the loading pointed to the discharge point is our cost. as that cost has fallen, we have been able to net back to a better net result. anna: you have achieved your highest quarterly cents 2008. oil prices helps your business. is one of your risks that we see the volume fouled away? if the oil majors start to cut back on the amount they are shipping, that it would undermine the business? >> yes. undoubtedly, that is absolutely right. at the moment, we are not seeing that. surprise, despite all the addictions. when you make oil cheaper, it gets used more. oil became an alternative asset
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class during the low interest rates and qe. it drove oil to $100 a barrel when there was low demand. that was very destructive for our business. when quantitative easing ended, oil price fell in 2014. demand went up. it went back to its right position. that was really important for us. it drove demand significantly. the iea said there would be no material impact as a result of the price fall. anna: it does --'s demand close to what gets shipped? >> sometimes you are close to a field or you move it by pipeline. they predicted that 900,000 barrels a day would be consumed additionally. they ended up completing the number at 1.6 billion barrels a day of growth. they revised the figure six
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times. the prediction this year, oil prices come off another 30% in the last two or three weeks and they have not affected that in. they are predicting 1.2 million barrels of growth for this year and we think it is higher. anus: that gives us independent assessment of the demand side in terms of the price. help us with the other story. storeds oil being offshore. we heard it in the iranian story. what demand have you seen for that? help us with that story. in a number comes of different parts. completely story is separate. this is about sanctions. they have a fleet of about 40 seat partakers -- supertankers. have alwaysips, 17
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been in service. a number of countries are not covered by sanctions. china, japan, south korea, have been able to trade for oil. 17 of the ships have been active. the rest have been in storage. that is the iranian story. for our story, a year ago, the talk was how you could do a carry trade just by buying the oil, and then closing out on the paper trade when your time came. a lot of people took ships during that time to read 30-40 ships were taken with the anticipation be read by the time they got them, the structure had fallen out. the ships never went into storage. the story of the year has been all ships move slowly at the moment. there is a hugely just ask problem. oil is everywhere. people want it off the field so they can carry on producing. they seal the ships relatively speaking slowly. 8-90% slower than in a normal
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market. oftenhey arrive, they find port congestion. that is unusual for oil. we might find in china and the middle east, we are waiting a week at ports. that is settling down the volume is. getting the space to unload. manus: going back to the demand equation, we have been told. history is china will pick up and excess supply. they will store in tough times. where does that buying come through? they are going to get it wrong again? who is buying? parks everywhere. europe went up with 300,000 barrels of daily consumption. at this price, people always said it was linked to gdp. it is not. it is linked to price. it is a consumer product.
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people drive more. that has been the impact in europe and the u.s.. china has been important. it is not economic opportunism. they are playing catch-up, not having enough storage in the system for the amount of demand growth they have had. that is a dangerous situation. anna: briefly, weight in on where you think the oil price go. taxi drivers are never short of an opinion. where do you think oil will go? -- i think the sensible view is, there was always a risk but it cannot he more than a few dollars. muchntage falls cannot get greater when you are this low. the risk must be to the upside to read you could regain $10 in no time. it is not a threat to our business unless we were to break out.
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and a: thank you for joining us. manus: "on the move" team is next. join the team. ♪ the only way to get better is to challenge yourself,
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and that's what we're doing at xfinity. we are challenging ourselves to improve every aspect of your experience. and this includes our commitment to being on time. every time. that's why if we're ever late for an appointment, we'll credit your account $20. it's our promise to you. we're doing everything we can to give you the best experience possible. because we should fit into your life. not the other way around. jon: hello and welcome to "on
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the move." we are 30 minutes away from the market open. the investment side if they still does not look good. >> it is the first major bank for europe. deutsche bank we knew would be bad. not realize the detail that would come out of the investment bank in terms of the level of underperformance. every major division is down. that is not what john cryer ne


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