tv Bloomberg Daybreak Europe Bloomberg July 14, 2017 1:00am-2:30am EDT
♪ heat praise trump on macron and suggests u.s. propositions to the paris climate deal is not set in stone. >> something could happen in respect to the paris climate upcourt. we will see what happens and talk about that over the upcoming period of time. wales scotland and shootdown theresa may's dropped break at law. asian stocks are set for their best week in march.
♪ anna: good morning and welcome to daybreak europe. manus: welcome to the show. ofhave the finance director the company hayes. it's a benchmark of europe and the u.k. and around the world in terms of wages. where should we start? she kept the dream alive. i will not sing the song. even though it's friday. anna: he doesn't sink before we go life. manus: i do. the emerging markets index. this is the potential golden cross flashing on the chart. what is that? 50 day moving average and 100 day moving day average, about to
close -- crossed each other. stocks gain more than 30% in the 11 months following, the last time we saw that was 2015. the market is saying we have a cracking run. there is a probable relief that janet yellen keeps the dream alive and she questions the veracity of inflation. anna: a lot to talk about in terms of yellen's affect on market. on the risk radar, let's look at where we are with the dollar after a couple days after janet yellen's testimony. gradual seems to be the mantra. inflation is what we will watch for. , that is what we are supposed to be looking at. seen insitory is inflation. that's the key question. s&p futures looks flat right now, but lots of banks reporting
later. it's been a dull quarter over the last week, which in turn turns to the revenue. that's the expectation. manus: those financials are going to be the driving force of the afternoon session. dollar-yen, again, i got lost in technicals. for theoubt the ability dollar to rally, that puts a cap on dollar-yen. and100 day moving average 200 day moving average are close to form a cross. the last time this happened was december, 2015. she is going to cry if i get more technical. 18%, oil down 1/8 of 1%, the iea has upped their demand quotient. rebalancing is less certain and that's the issue for the oil market. demand growth will be the strongest in two years.
down at link which is 46 and no change. the: let's move on and get bloomberg first word news with juliette saly. juliette: thank you. president trump says the meeting ast year 20 donald jr. and russian lawyer was uneventful. speaking in pairs during the press conference with emmanuel macron, trump denied the lawyer in question was connected to the russian government. i have a son who is a great young man, a fine person, took the meeting with a lawyer russia. it lasted for a very short period and nothing came from the meeting. it's a meeting that most people and politics would have taken. juliette: senate majority leader mitch mcconnell has released his new health care bill. he will try to gain conservative report right discarding earlier plans to repeal a series of
taxes on the wealthy. >> after numerous meetings with constituents and intensive conversations with members, our conference has updated the draft with additional provisions to make it stronger. democrats uniformly oppose the effort, mcconnell needs 50 out of 52 gop votes to prevail. theresa may's draft brexit law has received backlash from scotland and wales. it failed to give them sufficient powers and attempted to block the bill in their parliament. the u.k. acknowledge for the first time it will have to pay money to the eu on its departure. ecb president mario draghi will attend the annual symposium in jackson hole. this opens the possibility he could send a message on the bond rogue ramp as the euro era becomes less reliant on stimulus.
the gathering will take place in august, less than two weeks before draghi convenes the meeting of the governing council in frankfurt. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. you can find more stories on the bloomberg at top . it's a little bit more of a mixed session in asia today, that noting the regional index up for the fifth consecutive session on track for its --ongest session and smart since march. india has come off those record highs that it reached yesterday and you are seeing some coming through in japan up 2/10 of 1%. hong kong looking flat but holding on to the two-year high. much, janet yellen, we are continuing with the rally across asian markets.
it is india reporting season, a couple companies coming through. the revenue also raising its sales, sending his share price higher. we have seen prices falling in india. retailing in japan up by 4.3% falling the most since six months after coming through with its fourth-quarter profits. the key takeaway, we have had a great run up for asian markets and the regional markets at their two-year high. manus: thank you, juliette saly. it was the first day of donald trump's visit to paris and emmanuel macron managed to woo the president, saying they are each other's oldest allies. anna: president macron suggested that antiterrorism cooperation despite well-known differences.
speaking at a joint news conference, donald trump appeared to suggest his opposition to the paris climate the court is not set in stone. could happen with respect to the pairs climate accord. we will see what happens. we talk about that over the coming period of time. if it happens, it will be wonderful, and if it doesn't, that will be ok too. we will see what happens. manus: trump and macron will attend the bastille parade. we are live in paris. a good day to you. it looks as if there was a backslapping handshaking that was going on. i watched the news conference, which was very much the best moment for macron, taking france back to the heart of the global state side-by-side with the usa. morning, hen the
met angela merkel of germany, so it was a big day for macron, the two most important countries for france. macron hosted them on the same day. and in both cases, he came out looking good. with merkel, he seemed to have her backing up a little bit on her views on europe and with trump, i have not seen trump purring like that. he seemed to be under the spell of macron. but disagree on climate, they are working together on syria and antiterrorism. there views on trade do not seem to be that far apart. it was certainly a good day for macron. to workcron managing quickly and managing his relationship with trump. they have disagreements, but he manages to talk about those and acknowledge those and move on to the air is where they do agree. guest: i think the disagreements are important because he doesn't
pranced after him. he comes up very strongly and says, i am against your views on climate. we disagree, but we respect each other's opinion of it he has criticized -- opinion. he has criticized other things. that's part of it. he stands his ground and shows beliefs and says, these are the things we do agree and to the bigger point he always makes, france and america goes beyond who is in power at the moment. it's more than a 200-year-old relationship, the oldest alliance, they say. it's more than who happens to be sitting in the white house. trump goes for that. he's thrilled by the military parade today. he's taken with his to work with the paris monuments. gotten the trick of,
don't fire him too much, but flatter him just enough. manus: thank you very much. you have a great president, you will have a peaceful and beautiful paris, no mention of jim on this trip. .et's welcome our guest host he joins the team for the next hour. great for the cameras, this is the globalist moment. the reality is, he has to turn tax and health care around to drive growth higher. this is a moment of reproach for trump in europe? guest: good for the cameras, for the mood. paris is great for that. this will look good and feel good. anna: this test into macron's raise therying to franco german axis in europe as the u.k. steps aside come up
france clearly sees there is a role to step into here. france seems's say confident that they are talking of a game right now. guest: france wants to move forward. we are an economic recovery. the fear of autism taking over france is behind us. let's sit down with angela merkel and get on the front foot, away from the immigration crisis, away from the economic crisis. deliver sustainable growth and eventually much less unemployment. but yes, i think everybody feels confident that things are improving and emmanuel macron is the symbol of that to some degree. manus: things are improving and this is everything mario draghi will take with them. we understand he is going to jackson hole. the last time he was in jackson hole was in 2014.
he did not consult the governing council and talk about inflation being low all the way around. here we go. jackson hole. should this be a moment to shift the discussion on qe? tost: yes, but he will have be careful about how he shifts because he does not want the market to take the currency of 5%. this is the beginning of normalization of monetary policy. you go back to 2014, he hits up on a set of measures at the end of 2014 that took a range of his currency that have been trading 1.40, one .17. it's been a great success. he would not like to announce tampering with euro-dollar 1.18.
anna: he doesn't want to announce it. how does he stop the euro appreciating substantially as he steps away from qe? or is that not in his gift? is that up to other central banks whether the qe is coordinated with others? guest: how do you get that cake and eat it? i have been trying to get that right for years. week was a speech this where he went to great lengths to try to explain how qe had not weakened the euro. i was not terribly convinced by the argument and i'm not sure the markets are terribly convinced. but they will be trying to talk it down to limit the normalization. i do think at the end of the day, doesn't europe need these truly exceptional politics? not really. other you have all the
g10 currencies. forecasts, 23, 112, 113, coming along. so the market at the moment, suggests, we have topped out. would you concur with that? do you think the euro run is done? guest: know, we will see 120 at some point this year. it doesn't work like that most of the time. if you thought the way the forecast goes, the 125 is a good a measure of fair value of it they put ppp at 133. the big mac index is at 135. 118-ish.nge rate is at we havehe average where
been since we started. if you put all those in, i just think once you take your hand off what has been pushing it down, negative rates, qe put it down. it's going to jump up and you might drag it back down again. but the force is pulling it up. thank you. what about the politics here in terms of the french and the germans and the weight europe goes -- way europe goes? material part of the conversation from here or is this window dressing? guest: it's the start of the conversation of we are next. it's an awful fright in terms of what do we do and everyone the eurods that zone needs to get closer. you have to build foundations of a closer europe and banking
union is part of it and fiscal policies -- anna: less gross comes less crisis. guest: right. to mean's going anything, it's about sitting down and doing work when it is not terribly exciting. manus: thank you very much. --ing up, anna: it's harder than it seems. we will get an analysis next. this is bloomberg. ♪
congress. it happened over those two days. janet yellen said they conclude readings sayakened the central bank will fall short of the target. yellen responded to a question on the question of economic growth. >> i think it's something that would be wonderful. if you could accompany it, i would look -- accomplish it, i would love to see it. anna: sheet as a little skeptical. manus: the 3% is something that would be wonderful if you could accomplish it, but it would be quite challenging. 2% growth, various equity people have been through the door. you get double-digit earnings. share herpticismu sh
skepticism? guest: i do share her skepticism. the inflation target is more important than the dots. manus: this is the terminal rate proxy. it is fading. by 2020. where is the terminal rate in her mind? guest: the funds rate in most cycles is in the same place but not the same time as the yield. between 2.1 and 2.7, probably closer to 2.1 is where we are likely to get the end rate.
since trump arrives, we think we are going to get fiscal expansion jump. and since then, we are in a range. and we are a bit above of where he got there, but nowhere near three, somewhere between two point something, 2.5, somewhere in there is where the market is going. nothing happens to change that. else, theyanything are not going fast enough. anna: is this what drives the dollar? guest: i think so. the peak for the dollar was at the same time as the peak jump up in real 10 year yields. but if you look at what the dollar has done since, it has weakened because it has gone up elsewhere. theless useful it is for
dollar in everybody else's money. 2.7, 2.1ry yields are range -- manus: the differential narrows and it is not worth much for the dollar. executive. it means the dollar is not being driven by the u.s. as much as they were and where the u.s. were, where expectations about the fed are -- anna: how is the inflation data in adjusting people's expectations about how high the rate goes, how much more tightening we see from the fed? it could slow from 1.7 today from 1.9. guest: i think what you saw last you yields that as moved from 2.12 2.4, -- 2.1 to
2.4, this week with bond yields coming back down with janet yellen standing much more dovish, we are up 4%. the korean won is doing better. if we get a 1.7 cpi and sit there and think, we will get more of this inflation, the fed probably does not go in september because they will do some talent sheet reduction. the i think the winner is global hunt for yield. , and i am debate trying to take the hard data versus soft data. these are a couple surveys. the chicago fed in yellow and the -- they are all just tipping over. and the heart data is -- hard data is also on the tip as well. how much risk is that to the
dollar and to the market? guest: it still supports the idea in my mind that the dollar has peaked. it's not going down, it's slow, uneven dissents. -- dissent. i think there would be a risk if the economy slowed fast. if what happens is the u.s. well, slowly if you think the labor force is growing above 1.4%, and there is still productivity, we cannot actually keep 2% forever. thank you very much. i am still reeling from the imagery. are going to search that out. manus: we will have a bloomberg exclusive.
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delivers consistent network performance and speed across all your locations. hello, mr. deets. every branch running like headquarters. that's how you outmaneuver. ♪ manus: what a glorious day over there. of 3.34.r-yen is one -- 113.34 anna: asian stocks as well. we have seen five days of gains for the index, thing for its best week since march. a lot of money going into those asian equities. getting a bit of a boost from janet yellen. a goldencks nearing cross on a weekly chart. have not seen a technical
indicator like this in seven years. you just showed the price as 113.34. on the week, it is heading for a weekly day. does that mean we could see technical pressure perhaps some if you look at risk reversals, you see a skewed toward the dollar coming back a little bit. dollar-yen one to watch, especially the boj next week. $1216 and ounce. this is the moving average indicator and it has been below the line since june which could be a little bit of a bearish signal.
all comes of technical conversations around this. we will get to those in just a moment. some of the stories, the story is breakfast. the u.k. will have to pay for its divorce from the eu. the first time the government has said this on paper. the eu tork with determine a fair settlement with the state. these need to be resolved. one of my favorite lines in reference to boris johnson and the comments. i don't hear whistling, just blocks ticking. matt: a look --nejra: a lack --manus: a lack of strategic achievements. this could prove one of the talking points for president
trump as he continues his visit to france. a consensus for a 20.2 billion euros surplus could be challenged and of the u.s. could be by far the largest contributor. we're going to get a new registration for the block and we are going to see how the italian inflation data looks as it hit the tape later today. focusing on the banking story, jpmorgan kicks off season with advice on credit quality. the outlook could offer hence about how it is doing. see thep should also weaker trading environment. manus: work conference kicks off today. this is the regulators at all.
shadow banking, and overheating property market. good to have you on the program. what is different this year? what are we expecting? >> there is a lot of hidden debt and exposed debt. cautionary tales everywhere. theynsurance industry, how ran up going overseas. a lot of cautionary tales. what is likely to be a top the agenda, we don't have an agenda. we have to read the tea leaves in beijing with the financial czar in his cabinet and the various regulatory bodies. what he is likely to do, something for quite some time, that is giving the regulators, getting one umbrella agency to oversee the regulators.
you're a securities regulator. you also have the central bank. there is talk that there will be a new unit, a office of coordination. in number of people have talked arbitraget regulatory in china. those more risky products have been introduced in the last few years in the chinese economy. one of the big priorities. successorcould name a as a central bank governor. he is long past the retirement age for a high lever government official. -- high-level government official. scheme of chinese
gatherings or congressional gatherings, how significant are these financial work conferences? >> they are pretty important because every five years until you get the five-year plan, this is the financial proof -- blueprint for five years. there have been four of them previously. 1997, the asian financial crisis. issues a brief capitalizing -- of recapitalizing the banks. they put together a plan to recapitalize the bank but eventually list them overseas. bank, thetruction next meeting in 2007. for the crisis, you have the establishment on the well front of china. 2012 was a moment is here. the new leadership team is in place now. havenping, but also you
three years worth of unwinding. those were the risks they were tackling then. now you have all of the bubbling if x of the rampant credit gross -- effects of the rampant credit growth in the economy. anna: joining us there. the global strategist still with us on set here. it takes more than msci inclusion to get them back into buying asia. -- power plays three you around china at the excited are you around china at the moment? >> the problem is it is always the elephant in the room. the risk of that their debt brings to the global economy.
it is all tame at the moment. the chinese authorities have swept it under the carpet. the kind of stabilize the situation. stopped trying to depreciate currency and calm their relationship with donald trump more than anything else. it is not been as noisy this year as it could have been. >> which is deliberate and good. i don't know if it is all all of our problems. the debt is still there and the authorities set out on a mission to sort out the balance sheet, when they next need growth politically to make everybody happy. manus: pull some of these together on the currency. the weaker dollar continues.
ast does that do to the yuan a global currency and what happens? the use of art currency as payment for the risk is that it rises as the dollar falls. through your current thinking on it. >> i don't think it is going to rise much further. you have to remember it was not dollar,ing against the as the dollar rose against everything else we saw the yuan across their time zone. the effective exchange rate was a lot. life is getting easier for the
chinese. don't forget, that is pretty if you're in-yuan beijing. it is not as if it is not important. the exchange rate environment is becoming more helpful for the chinese at this point in time. it matters richly in berlin. -- greatly in berlin. >> nero was talking about a cross. anna: trying to find front of behind this point. what are your thoughts on where the assets go from here? this is about the currency. interestin on your
crosses, is that i have a death cross on dollar-yen is scary. manus: a golden cross on equities. >> i don't think i can have a dramatic rate higher -- lower in dollar-yen because manus: one is risk off and that is dollar-yen. anna: logic rather than what is in -- yeah. one is risk on and one is risk off. we are talking about so many things higher or lower. the best correlation you can get in markets is the dollar-yen. you can get a nice correlation between u.s. equities and
dollar-yen. what you see is that the dollar-yen likes slowly rising yields with global rising equities. that is a -- that is what emerging markets like. falling u.s. yields are good for bad things for the world. we are flirting with both sides of this. is too hot,ge that too cold, or goldilocks land? seen somewhat politics. so much drama on capitol hill and elsewhere. it has not created a great deal with a cannot believe i had to check myself to describe it in the past quarter having been dollar. -- dull. >> if we come back in with a 1.7% this afternoon we are
definitely not doing anything to boost volatility in the markets. i have 2% growth. i have have a percent productivity. i'm struggling to get inflation. trundle, trouble, trundle. the rest of the world trundles. of exceptional policies. they take the msci higher and the dollar-yen higher. manus: thank you very much. customer, a bloomberg you get tv on your screen as well. you have the functions, you can even join in and give him a harder time than i give him. there is a button at the bottom. anna: you can even watch with sound off. manus: why would you want to do that? program, forthe
♪ 6:47 in london. cable trays 129.62. the dollar weakness is probably more than strength. the hsbc saying that even if you have got a rate hike on the u.k., it would be sterling, negative among very little is going to help break that box 30. juliette: thank you. vanguard ceo will step down at the end of the year. he will be x -- succeeded by tim buckley.
it's all its size more than triple. mcnabb will remain chairman while buckley will take the helm on my first. -- january first. answering questions about emissions cheating. motorsg on to diesel allegedly with defeat devices. being used by several mercedes models. police raids on a number of sites across germany earlier this year. ceo has joined the rifle in expressing support for tree -- free trade. american drinkers could face higher prices if donald trump's tax on imports is enacted. >> there is a lot of talk not
much happening. tequila is a hard thing in the united states 100% agave. it is going from being a shot into a high-end. whatever comes will obviously impact all of the players and might impact the prices for everybody. i don't think the u.s. consumers first for such a amazing spirit tequila will bring. thank you very much. take the tequila house. wall street banks take second -- center stage with j.p. morgan signaling that trading revenue could drop i can-20%. manus: investors will try to look beyond this. they will ease regulation, boost growth.
intelligence analysts we bring them in. it is interesting, anna said it is a sluggish second quarter. we did not have the virulence of the fx markets. from the investment banking side, it can be a tough quarter. >> estimates are expecting a 10-20% drop in what we should bear in mind is the second quarter of last year was a very truck -- tough comparison. , brexit vote, elevated trading u.s. elections heating up at that time. it is a tough comparison. i don't think we should be overly concerned with this developments. clearly it is not positive. anna: that is one positive story. are there areas that are going to focus in on the regulation side of things? the way the easing of
regulations in the u.s.? --the regulator he drop> regulatory backdrop is something. there is going to be a big focus on margins and whether banks can because- expand markets loan rates have been slowing. we need expansion to offset some of that. >> you've seen a rates go up in the u.s.. it is all about -- we have seen not too much competitive pressure as well. there is a more positive outlook. the retail side in the united states, the market is so strong. integritying to be important. growth is a key driver of the bank retail operations. the outlook is looking positive
on that front. it is something investors are going to be looking at closely. anna: can't wait for the specifics. the easing regulation and that story. 3% growth is going to be challenging. banks enable them to lend more. 3%america can't get to growth without either lots of employment growth in the economy with a low employment rate, impossible, or more productivity. making it easier to do business. innovation, investing in new capital, these are things you want. tax regimes changing. infrastructure spending helps. the solution -- i'm not sure the solution of this is to make the cost of capital or banks have less capital, but tightening regulation around banks after the crisis is certainly not helped to make the world a better place -- a safer place.
i think the u.s. really needs is infrastructure spending and more innovation. is going to take time to deliver. stay with us. the bloomberg intelligence analysts. he conversations continues later today. banksl dig into those because bloomberg is going to speak to be wells fargo ceo all about the bank results at 9:00 p.m. u.k. time. 4:00 p.m. in new york. anna: the u.k. has a knology on paper that it will have to pay money to the eu on its departure. furious backlash in scotland and wales. manus: failing to give them sufficient powers, they threatened to block the bills. atre was a warning shot luxembourg.
he said this is all playing out in the media. the brexit discussions in the media. twice the lack of clarity. we are really making no progress. that seems to be he the impression with no clear focus from the u.k.. that is disconcerting but the sterling meanders on. > is depressing in a sense that there is a timeline. we started with a two-year clock. are a whole year into that taking, but from the votes it has taken us a year to accept what everybody knew all along. if you want to get divorced you will have to pay a bill. sorry about that. manus: that came in writing. that is the key story. anna: the first time on paper. >> this is going slowly. the uncertainty, i cannot avoid
making people, socially, professionally, whose businesses are seeing their books affected by the uncertainty of what is going to happen. as long as that continues to work, it will, what we need to do is get a transition deal because we are not going to get everything sorted out in time. not at this stage. anna: what is the market for drink -- factoring in around transition? a few months could be ok, we spoke to the bcc and they were talking about three years is the benchmark. people are on different pages on transition. >> people in the markets are thinking the fear is the politicians are over optimistic about how fast this works. whenever you talk to a trade lawyer and they have years of business their way, you start thinking it was going to take a
long time and the chambers of commerce are much more realistic. we need that much time. how is this going to play out if we can't get one together? brexit is not need to bring recession. you will get less growth then you will have otherwise year after year after year for a bunch of time to come. if you get a rate hike it is not going to change. england, theank of long-term value of the pound. levels that are quite frightening. -- 2008.eight lower the 1995. talk me through this, go. we have taken the pound down to where it has reached in 1992. the same level it reached after the global financial crisis. the sterling is cheap. a holiday is expensive. at that point it takes massive
manus: the lacrosse -- vivre la france. u.s. opposition to the climate deal is not set in stone. president trump: something could happen with respect to the paris record. we will see what happens . we will talk about that over the coming period of time. anna: scotland and wales should down the draft brexit law. manus: asian stocks are set for the best week since march. look ahead to the u.s. bank earnings.
welcome, our flagship morning show in the city of london. to the program. 7:00 in london and 8:00 in paris or berlin. that car sales growth has slowed a little bit. the brexit effect here. the headline story coming from bloomberg news. slower pace in a june. on the peak in the vehicle markets. registration increasing at 2.1% year on year. toyota and fiat posting the biggest gain. the strongest june since 2007. growth has lagged behind the 7.7% doctrine.
pretty decent. there is a brexit effect. buyers have been cautious because of the uncertainty. manus: a nice brisk opening to european equity trading. we will talk to the ceo very shortly. head -- this is what you're looking at. one is, paris, frankfurt. paris up by .2%. waiting for data in the usa. we are going to have a whole other conversation. asian stocks, emerging market stocks, all flying higher through the trading session. cfo next to us speaking about the earnings. the dollar index is pretty unchanged. yellen day two, gradual seems to be the message there. the cpi. if it is transitory, the
weakness, does that change the interest rates? futures look pretty flat. lots of bank earnings to come today. called au have what is potential death cross on dollar-yen. yanis stronger risk off. a golden cross in a emerging market equities. emerging markets trading higher. how do you square to way -- square it away? you are seeing a move to risk on. flat at the moment. demand will grow. anna: his take on some of the inconsistencies. 0.1%, asian stocks in general
heading for the strongest week since march. manus: as we start the trading --, mario draghi is going to the last time he went, he made an assurance of magnitude in 2014. this is interesting. yields are dropping, they are dropping in the oic as well. hole, 2014, he said he basically does not see inflation anywhere on the horizon. could this herald a different moments. moment? anna: here's julian starley. juliette starley. juliette: emmanuel macron it managed to the blue the u.s. presidents. -- woo the u.s. president. common positions from military
to anti-terrorism. speaking at a joint news conference, president trump even appeared to suggest opposition to the climb us -- climate accord. president trump: something could happen with respect to the paris record. we will see what happens. we will talk about that over the coming period of time. if it happens that will be wonderful. if it does not that will be ok, too. we will soon happens -- see what happens. juliette: he said the meeting between his son and a russian lawyer was uneventful you speaking with -- uneventful. he denied the lawyer was connected to the russian government. president trump: i have a son who is a great young man. he took a meeting with a lawyer from russia. it lasted for a very short
period.and nothing came from the meeting . most people in politics -- may's drafttheresa brexit law has areas backlash from scotland and wales. the attack plan for failing to give sufficient powers and threatened to block the bill. the u.k. knowledged for the first time that it will pay money to the eu on its departure. have rescindedls the global peace prize after his death from cancer drew criticism around the globe. the 61-year-old author was jailed in 2009 advocating an end to one party rule. the chinese government had been largely silent as human rights advocates issued tribute. in first two thy -- to die detention since 1938.
global news 24 hours a day powered by more than 2700 journalists and analysts in more , you can findries more stories on the bloomberg at top . is the final trading day of the week in asia. we are rounding out in japan and australia. really worth looking at the big picture today. we have had five sessions of gains. the regional index holding of april highs. the strongest week since march. still holding on to record highs, although india has come off of its high. the hang seng slightly up, holding on to the two-year high. a very interesting and rate week for asian markets from janet yellen. a lot in the union session as we see earnings come through. doing very well on its first-quarter revenue. down after its earnings and also a broker downgrade from mk you
the owner in japan falling the most in six months following -- falling the most is third-quarter profit. let's have a look at this chart. certainly back in town as we see the rally continue in emerging market indexes. it actually got this rare golden cross coming through for the first time since 2010. that is when you saw the 50 day moving average hit the 200 day -- 200 week moving average i should say. the last time was in 20 trend. -- 2010. i know you showed this before but it is a great one. imitation is the highest form of flattery. manus: i will take a couple met from anybody anywhere in the world. she has a golden cross. the two do not match up. thank you. 7%, full-year
operation profit ahead of consensus. he recruited firm says that growth declined in the united kingdom. manus: the finance director of hays. always a great bellwether and how the word looks. you have growth in aipac, climbing in the u.k.. talk me the nuances of u.k. and ireland. has the election and the brexit confident in the press hit you yet? >> when i came on one-year o -- are. -- are. at one point we lost 20%. that quickly stabilized. effectively we lost 10% around the exit. since november we have been flat as a pancake. very predictable business. a positive is with the elections in early june have had no
snatches at all. underlining, control across all companies. private sector businesses still doing some investments, a return on the 6-18 month timeline. you will be a brave company to go and spend a hundred million on the last investment project in the u.k. unless you had a phone call to somebody in government that you could say can you give me a guarantee. anna: we are looking at the export side of the economy and trying to work out what upside there is. a sweet spot in europe where we are still in the eu. weaker pound. exportms managing to services and the benefits they're getting from the weaker pound at the moment. we seeing anything in your numbers that tells us about the sector managing to weather the storm and export more? >> i do apologize. i think you have got some
pockets. the growth in legal firm is coming and how it is brexit based. clearly a lot of that is setting up business abroad. most companies in the service sector or manufacturing sector are -- have a very clear game plan. the positive results is since last november we have been sick unjustly -- sequentially flat. we'll be about zero. i'm not expecting that to change very much over the next 6-12 months. manus: in france we saw the theater of macron and trump yesterday. you often said that you have a dexterity in terms of where you deploy the capital. are you going to deploy more capital in france? how optimistic are you that macron will deliver change? how could that impact the bottom line for you?
>> i think it is more than that. the real positivity happens to-three years ago. ago.3 uears making about 12 million pounds this year. this is not eight macron impact. at the first couple of years in government when there was is that uncertainty, now you have got one on top. a photogenic prime minister in a good position, good mandate, that has to be business supportive. the positive is the result ready momentum there. now you have got political certainty. weis the whole of europe you have doubled the size of our business over four years, a very doubling.e map toward structural of term yet to be delivered. do you see real results
achievable? >> we will find out the next 3-6 months. you have to take the unions on. you have to make a series of laws to increase flux ability. the real question is when you have tires burning and everything else, will they hold their nerve? opportunity to push labor reform and push that through while you have support. you have to make sure he does that. if you does that you have a added it get to the french economy. france and germany together, lots of opportunity for investment. i said on the last show when manus was here, this is the most positive thing in the european economy since 2006 and 2007. manus: we talked about pay cut yesterday that hollande implement it. get ready for a few punch up in terms of wages.
>> we could put the whole of the world on this chart at it is not going to be too dissimilar. a little joke of the last two years. the underlying situation, we are very global economy. all companies are under continuous margin pressure. we are all having to reinvent ourselves, looking for efficiencies in business to improve margins or to at least protect the margin in play. what we do is, for your stock performance, look after them. we do not get that he would have had 10 years ago across the line, 2, 3, 4% inflation increase everywhere. what you now get is a low annual increase in very targeted
investment. i don't see that changing. in germany it is a before economy at the moment. -- beautiful economy at the moment. germany has just overtaken the u.k.. our largest profit generator. doubling profitability for 100 million euros to 200 million euros over the next five years. we are a dominant player in there. anna: thank you so much for joining us. up next on the program? manus: the brexit bill acceptance. for the first time on paper the u.k. hasn't knowledged they have to -- has acknowledged they have to pay up. not so much whistling from this government. this is bloomberg.
♪ anna: welcome back. the time is 18 minutes past 8:00. he euro is trading at 114.10. let's get a business flash here is juliette starley juliette: succeeded by investment chief tim buckley. largest moneyhe manager. more than triple as investors embrace the low-cost index funds. buckley will take on the helm on january 3 -- first. asking questions about possible admissions cheating. mergers on to diesel fitted with the so-called cheat devices.
question follows police raids on a number of slides across germany later this year. backing -- private equity firms, the set is -- the deal is to value at more than 100 million dollars according to a person familiar with the negotiations. sales making it the fastest growing in history. bloomberg business flash. the u.k. has knowledge for the first time that it will have to pay money to the eu. theresa may on the threshold to reach a deal for the brexit deal. the eu wants progress before britain's future can begin. anna: the global managing
partner and former head of the u.k. foreign offers -- office. great to have you on the program simon. we have heard a lot of contributor voices talking about something softer on the brexit front. still the government is committed to the speech. it seems to be prioritizing domestic control of the economy and trade. your rates. >> a lot of people are putting more emphasis on the economic issues for the future relationship. the relationship with single market and the customers union. we don't know whether that is going to come out. as you said in your introduction, that part has not begun. we are starting around issues on how that separates in the first
place. manus: trust for the u.k. is a rare commodity. idle as themain clock is ticking. those types of warnings and warnings from the financial reader of luxembourg, you think there is any side of making concessions that were not cognizant? >> the next round of formal process is starting. it is very early. i agree. you need confidence and trust on both sides in order to make that work. remarks to not always help on either side. i think we need to take this seriously. the other thing is, of course countries are talking to each other behind the scene. the core of this is in the formal negotiation. until we know where that is
going, around the edges. anna: everybody will tell stories of victory on both sides. this anybodyding has the upper hand and has ?chieved anything >> the european union side has the upper hand. there is a time limit and we are the people who are asked to leave. we asked to leave. concessions will have to be made on both sides through this negotiation. as you said earlier we have seen the british government accepting that there has got to be a financial settlement. significant -- is that significant that it has been put on paper? >> a formal recognition of a fact that was known. i think the british government
has previously recognized this was the case. can we reach the agreement on the basis of that assessment rather than having numbers around without any sort of evidence behind them? anna: what is the significance of the repeal bill? this is something that slows us down, does it trigger a softer brexit? what was the significance of it? >> the repeal bill is the mechanism by which we are going to make sure that brexit happens. with continuity for people and businesses in this country. if we don't have that by importing european regulation and ball into this country, we will be a nature to situation. what we have seen at the moment is domestic politics in this country after the election is more complicated than brexit. seven mps to agree
with the opposition side to put the problem -- put the government in a problem. it covers nuclear matters. now they're having to backtrack on that because we have not really but -- thought through the full implications. find: they are trying to some sort of fudged oversight in that regard. anna and i spoke to the chair of british commerce, at a marshall. he said he would be happy with a few months of the transition. optimistic. their members say three years being minimum. they need and want transition. months. it is optimistic. view there will have to be a transition because you cannot negotiate this agreement in two years. that is unrealistic it is going
to be not months. it is going to be years if we are going to have a smooth transition to a new arrangement. assuming that is negotiated. anna: what is the chance the whole thing collapses? you suggested there could be votes of some form within parliament that change the course of brexit or rejected altogether. what is the chance? >> there is a risk this will collapse at some point because we cannot reach an agreement on tricky issues. to do ishat we've got get on with it. and travel down the road of we best game. we don't know what the destination is going to be. manus: thank you very much. the former head of the u.k. foreign office and dick black service. anna: just over an hour and a half -- no, just a half hour. european trading.