tv On the Move Bloomberg September 1, 2015 3:00am-4:01am EDT
-- futures climbed to 7%. futures down by 92 point. that's futures down by 168 points. less than a market open. reporter: yes, indeed. a drop in august for the stoxx 600, the worst month since 2011 for you european stock volatility above you as volatility and yesterday we saw but infinish flat negative territory. let's see how markets are finishing. them moving lower. the ones that have opened so far. ftse 100 was closed for a bank holiday yesterday. it is down 0.9%. cac is down. gaugee manufacturing dropped two of your low.
a look of what else we are dropping. -- 82 year low. currencies, what we have seen is a move towards the safe haven. yen strengthening against the dollar. the swiss franc is strengthening against the dollar. what we have seen as the euro becomes a safe haven. the correlation between the euro yen act of the highest since 2007. that is the currency. i cannot get back to you until i have a look at oil. i want to look at wti first. a three day bull rally up and three days. the biggest three-day gain in 25 years coming off of the now a little bit. same-store for brent crude. last week, we saw brent drop below $45 a barrel for the first time since 2009.
it is now $54 a barrel. back to you. jonathan:. early rules. the ftse 100, the city getting back to work. is down by over one percentage point. big moves and asia. not in japan -- and not in china but japan. reporter: i wish i had better news but a down day across of the region. what looks to be a volatile september. disappointing data from china driving it's a lower. japan where we had the yen rising due to the safe haven buying. investors getting out and fire safe assets. gold advancing as well. significant drop for the japanese market. the index falling. on the upside in the japanese session today.
currencies are moving across the region. trade center the and the shanghai, the big story. 1.2% decline. it was worse earlier, we were down as much as 4.8%. speculation that the government buying -- a lot all speculation at that the government is coming in and buying up stocks. meantime in hong kong, property shares on the upside. telecom and china mobile is up. investment, estate a 1% gain. major property development and we of seen energy -- energy stocks rather in hong kong. a bit of pressure even though oil has been rising. look at what is happening with the majors. h shares.
a reversal as the day went on. this what you have. petrochina, all falling today. and we also see macau related casino shares hauling as well. the forecast is macau is significantly lower in the common months and that is one -- coming months and that has want to watch. not as many high rollers. we will watch that and what promises to be another busy week. jonathan: zev acord, thank you. the dax any you're proceeding off of the losses in asia and weak pmipmi number -- number. bhp is down. miners, exposed to the chinese story. monetary easing, no remedy for china slow down.
the factory gates at the lowest level despite the people's bank of china cutting rates five times since november. bloomberg intelligence tom orl h ch joins us. not exactly paint a pretty picture. what does it say about the success of the government stimulus effort so far? tom: that is completely right, not a pretty picture coming out today in china. 50 number is the drop below four the official pmi. capturesial pmi really what is going on in china. the firms that should really be .alancing act and ratchets up clearly, they are not. since november 2014, the cuts you mentioned at the cut in the reserve and that ¥3.2
trillion bail out package. all of this has not been able to restore the sector. jonathan: outside of manufacturing and the services, website big, robust growth and -- ands and with the sea we can see signs of weaknesses as well. how does it change the story on unemployment? do we have a read? tom orlik: it is a bit of a black box. of the lastst, much year, the narrative of china has been weakness in the factory but do not worry because the services are doing better. that is preventing a big increase in unemployment. the august numbers are changing that story little bit and not in a very positive way. the official non-manufacturing pmi services sector shedding jobs.
services sector still adding jobs but at a fractional rates. that story about the services sector saying being robust and offsetting, that story may not have the happy ending. a month, west haven't talking almost exclusively about what is happening with the exchange been pretty -- we have talking almost exclusively about what is happening with exchange rates. can you talk is what has been done? tom orlik: a school for our reporters, news that the pboc may be imposing reserve takingments on a banks for positions on the exchange markets. the obvious interpretation of the china central bank is moving the exchange rate toward the markets. they still want to see it have full control. they want to impose controls and
how it functions. jonathan: thank you for raking get down. tom orlik joining us from beijing. if your were -- wondering what's behind china's rout, a admitted tos wrongly reporting china security regulators are studying an exit from support measures. and his video, he expressed regret for causing "such great damage to the country." we are joined by our guest, andy lynch. lynch, spreading vicious or the hardhe press data? andy lynch: more on the data.
farmarkets have gone up so and it was exhibiting traditional signs of classical bubble territory. lots of new people entering the stock market. [indiscernible] handed out stock tips. the classic bubble territory and bubbles always burst. there are good things happening in china. the economy is probably still growing a little bit. of 150%. jonathan: less divorce and the stock market and i will pull out a quote of yours. -- let's divorce the stock market and i will pull out a quote of yours. a mr. inside of an enigma, what is happening in china right now? :ndy lynch
it is difficult to tell. there are questions about the chinese government. even when premier league -- premier li and did not necessarily follow the chinese statistics as things like electricity data. [indiscernible] it has slowed down sharply. probably still growing not growing. let's turn to europe. [indiscernible] jonathan: a considerable drop i'm look at the companies where the growth would close from
china. how on earth do you have a balanced equity portfolio in an environment like this? andy lynch tom orlik -- andy lynch: we are going to european domestic stories. unemployment is coming down. story it hastic been since 2008, 2009. and there are more domestic stories and reducing exposure to the companies that are very dependent on chinese. jennifer: it is not disaster in china but a lower -- jonathan: it is not disaster in china.
thinking about realizing losses, stops when we are down deep in the red, what do you say to them? andy lynch: my advice is [indiscernible] it is a long-term game. you do not put money into equities area -- equities. [indiscernible] college fees. if it is 10 years out, great. the potential, return. [indiscernible] short-term, stay away. long-term, stick with it. jonathan: short-term, how short it short-term? reboundingthe debts and we open lower today off the back of dreadful data, are we
about to test of the lows? is this a bear market? the lows of last week? andy lynch: it is quite possible. the market might have another led to down. let down. with talked about china and they have a lot of debt and that needs to be paid. overhang on the globe economy. short-term for me is less than 12 months. long-term is three plus years. my [indiscernible] i am recently happy [indiscernible] jonathan: i will ask you more after the break. andy lynch will stay with us.
oil is the month with the biggest three-day rally in 25 years. at the economy and where the gdp number has fallen 26% and german jobs. the jobs report. 40 minutesabout time. the city a london getting back to work. the dax is off the lows for the session and we are down by 1.7%. the cac 40 is lower. ofer off with the back dreadful pmi data out of china.
jonathan: good morning and welcome back to bloomberg tv. i am jonathan ferro. let's bring you up to speed with some of bloomberg's top stories. chinese stocks, the biggest to tolerable since 2008. an official gauge dropped to a three-year low. august atal pmi for 49.7 and contraction territory and down from 50 in july. german chancellor angela merkel said of failure of sharing refugees could harm the eurozone. meet the spanish
prime minister to discuss the issue later today. australia has left interest rates unchanged at a record low 2%. the currency pushes lower commodity prices. widened in deficit the second quarter to 19 billion aussie dollars. the largest since 2009. it is all about china. a problem for australia a european equities. by almost00 is lower one full percentage point. minors leading the early losses area the biggest drop, monthly drop since august 2011 down a .5% extending losses in today's session. the dax is down by 1.8%. backf this coming off the of the official pmi in china for manufacturing dropping to a three-year low. switch up the board and the fx market quickly.
dollar, a against the stronger dollar. aussie dollar, originally pushed higher. a stronger aussie off of the back of the rba decision. a flat aussie. wti is lower by 3.2%. a big three-day search, the biggest three-day for crude and 25 years. 27% higher. it had been at a 1999 low. it is down by 0.8%. a week, big story. it might have been inconceivable for oil to drop below $50 a barrel and still be in a bull market. that is exactly what has happened. opec says it is time to achieve "fair and reasonable prices." let's bring in james. moveil glut, i look at the
and i see this big what you can call a short squeeze. i will ask at the fundamentals have changed? has it? james: i do not think so. web seen new data from the u.s. sure production is lower. opec has made these statements yesterday about talking to other producers and that is new. an official position of theirs. they have been trying to for a long time. they had a meeting in november before the end of a new strategy that led to the price drop. they spoke to russia and mexico and nothing came of it. jonathan: do you think it will have an emergency meeting at this time? james herron: personally know. -- bi,\- no.
an emergency meeting might make things worse. saudi is willing to cut production. one of venezuela and algeria said they want an emergency meeting, they want to discuss other production not ours. jonathan: sitting around the table. to bring you back into the conversation, andy, you were talking about your two year old. if you want to invest in you see these big, you have a choice, the stock is in there too cheap or the evidence is getting cut? andy lynch: when it comes to crude, i think the dividends are not going to be sustained. not particularly because of what is happening short-term oil price wise but 10 or 15 years ahead, i think most certainly will be -- energy, crude oil demand.
the stock falling. it has to stop falling. otherwise [indiscernible] valueesult of that, the of oil majors is actually very outtionable until they come with a new strategy to start investing cash flows and generating now into renewables and things that will give them a future beyond 2050. jonathan: i want to highlight is is pretty you said crude and $47 a barrel does not actually matter if we got to the $85 as a sector? it is pretty dreadful unless they move away from those products? andy lynch: there will be other investments. looking to squeeze out. and that is fine. that on a regular basis. we are told byat
climate change and the carbon, we cannot continue to consume oil at the rate we are. the rate consumption has to come smaller cash means pot. jonathan: the rate of consumption has to come down. the big story, has it rolled over in a way many people thought? thet of people wait for rate count, it has started to rise again, has it fallen? is that what people are saying? : it is going higher. whether production is doing the same as hard to answer. runforecasts for the long is the growth at least in u.s. production will slow. companies that have created
this industry in a matter of 10 years. trying new ways and developing new technologies. the technologies are still coming through to make it possible. who knows? jonathan: a difficult question to answer. and that 12 must previously what was up collapse in crude prices and we thought it would roll over. nothing substantive to and 50 and we thought it was switch over. your view of the majors is pretty truffle, what about u.s. sha -- pretty dreadful, what about u.s. shale? andy lynch: a lot of the operators and they have around the world, the level of debt. if you look at the way it is it tog, you can expect
get fully repaid on that debt. that is a very dangerous place. always getting their money back before of a chance to get my hands on the cash. the fixed income might stay away. jonathan: is that spreading? how much time are you spending looking at credit right now? andy lynch: [indiscernible] side trying toe figure out what is happening. more as a sector level because i funded bye many are bilateral bank debt. having bonds out there. to me, it is more problematic sectors, the fixed income market saying i can take and apply the portfolio in general.
jonathan: gentlemen, thank you. andy lynch and james herron. macau's losing, streak. how can things get worse? we would do that after the break. the ftse 100 is open. the city gets back to work sending the ftse down. some of the biggest mining majors pushing the stock index down. they come back a bit. 2 points on the back of a pretty dreadful pmi reading out of china. is fueling the losses and the early part of the session. stay with "on the move." we are back after the short break. ♪
jon: good morning and welcome back to" on the move." 20 july from bloomberg's european headquarters in london. let's see how equities are shaping up in the early session. low of at a session 2.25% down. deep in the red. if you want to read about one thing today it is that chinese pmi number. a three-year low for the chinese manufacturing numbers. that is sending us lower this morning. with one of the best performers in the stock
600. a swedish company that makes medical products for neurological projects among other things. its four-year outlook. at rwe down 1.5%. it is not one of the worst performers but this stock has dropped 48% this year. it has been dragged down by a slump in electricity prices. it is germany's largest power producer which means it will be booted off the euro stock 60. that is the blue-chip index. it has been on it for 17 years but as of center 21st it will no --ger be on their cash there.
this is also off that euro stocks 50. other oil and gas stocks have been writing -- rising. we are seeing crude oil had down today but that comes after three-day rally. the biggest rally in 25 years. jon: equity markets are trading off the back of the chinese fallout. trading not very well. gaming revenue has plunged once again, this time by 36% which ofks the 16th straight month losses. things do not look good for the world's largest casino market. tim joins us now from hong kong. break this down for us. is it all about chinese economy or chinese regulation?
>> it certainly plays into both of those contexts. there is some good news and bad. the good news is that we were flat sequentially. you want to look at that from a relatively positive standpoint, that is fine. but the underlying one is an important shift toward mass-market away from the i.t.. t. di this is not a good situation and set of this is the restrictions and the anti--extravagant mentality of customers that don't want to be finger pointed.
that is all playing into why we have seen such a fallout. jon: 15 straight months in drops -- when do we start to see a bottom? this is: part of clearly about visitation but an underlying aspect that does not get enough focus is -- if you go to macau, you don't see anything new. they haven't opened a new resort for almost three years. it is a construction zone with seven massive construction sites in place. macau natives saying i am being overrun by chinese. massmarketed facility that opened and an
early 2016 a few more of these mass-market resorts. that is the key, if we get a little breath we could see and macau --nd recovery in we could see in flexion and andvery -- inflection recovery. jon: not everyone is suffering due to chinese exposure. today, the reserve bank of australia announced that it will leave interest rates on hold. michael heath joins us live from sydney. what is the extent of china bistro impact on australia? china's impact on australia? how much? guest: is a bit of both but
china is australia's biggest trading partner, and is the most dependent developed economy on china. people are using the rba is a guide for what might be happening in china. the rba noticed a further softening in chinese economic conditions and also noted the volatility and global stocks daily driven by china but it was much more descriptive than prescriptive. get a betteryou'll reading today with the release of current account information and a lot of that was driven by a drop in trade volumes and perhaps another noted that key commodity prices were much lower. the other part that it left out
was due to lower demand in china. the central bank knows that the public is very attuned to what is going on in china. in many respects it is a blend , but china is absolutely crucial. jon: thank you very much. i remember when i was in australia politician read drew a map of the world and put australia physically closer to china. look where it got them. coming up, this drug maker joins forces with google. how they plan to battle diabetes after the break.
jon: welcome back to bloomberg tv. i am jonathan ferro. let's get a look at some of the top stories. chinese stocks have seen the market's biggest two-month stumble since 2008. concern grew over the government's intervention. the pmi for august came in at 39.7 and down from 50 in july. the biggest three-day rally in five years. oil futures slid as much as 4%
in new york. highest in aits month after opec said it is ready to fall to other producers to boost prices. booted from the stoxx 600 index. it was hit harder by german's electricity prices which are at their lowest in more than a decade. crisis,n save banks in we can save refugees. that is from angela merkel who says a failure to help refugees could put eu travel at risk. hans nichols joins us from berlin. how is angela merkel making her argument?
hans: she is making a three-part argument. the trade-commerce argument said the area could be at risk if you do not have a distribution system and is also making a humanitarian argument and to the german public she is making a historical one. that germany has an obligation to refugees and that germany should be proud that so many want to come here. those fiveght, trains that flew through austria and arrived in munich. some 800 new refugees. looking at the asylum applications, they are accepting thousanding a hundred -- 800,000. compare that to other countries -- much lower. 6000, greecend
6000 -- excuse a, italy is 30,000. leaving behind some of the raw numbers your hearing from inside the regional government. you need to make the distention between economic migrants and refugees from war-torn countries. if you are harsher on the economic migrants, you can have a lot more space for migrants from places like syria. syria tops the list for both countries. you start to see a little difference. spain has a much bigger economic migrant problem, germany too. then you get back down to the war-torn countries. she is kind of shifting her rhetoric. if you fail on this question of refugees, its close association
with the rights of citizens threatens to fall apart. europe as a whole must move on this. the current situation is not satisfactory. angela merkel is saying something she will have -- saying she will have something ready to propose in december. jon: it is a tragic situation but the brutal reality is it becomes a political football. what does it mean for germany? how is merkel navigating the politics domestically? hans: she is trying to shift the conversation more internationally saying you need all countries to do their part. we look at the number of applications, germany is way out in front. numbers. 2014 the only country that is close is sweden. on a per capita basis, sweden
has a much higher percentage and angela merkel will try to turn this. as we know from numerous conversations on greece, it is very difficult to get concrete action out of brussels. jon: thank you for breaking down that important situation across europe. a big question, how ready are you for the future. caroline hyde is there and joined by men -- man looking at new ways to fight cancer. caroline: thank you very much. i am in the mclaren center by heathrow airport at the ubs global leadership debate. we will be discussing everything from trends in energy, technology and medicine. professor robert horovitz is from m.i.t., but is a nobel prize winner for working -- work in oncology and cancer.
you've worked together with individuals in cambridge, but it is a huge personal price that people pay with cancer and an economic price as well in terms of the sheer scale of money you feel is being paid for cancer. , it affectsall patients and caregivers. the economics not be so obvious. $835number i saw was billion for the year 2008 in the u.s. alone. that is an enormous cost in terms of workforce and death disability. unmatched by the rattle -- rather miniscule investments that have been going into the research that will lead to the breakthroughs for this
horrible disease. caroline: tell us about the excitement we may see in the moment. are we starting to see these trends make a difference? cures areonal cancer things like radiation and chemo. the problem is they kill not healthycer cells but cells and sometimes even patients. what is needed is something with much more specificity. today there are a number of breakthroughs. the first is the human genome project which is very much driven from this country and the united states and from the human genome project we now know all of the genes in the human genome which means it has been possible
to identify all of the genes in a particular cancer patient. knowing the specific genes that are abnormal and a cancer means that those genes can be targeted. that has really taken the world of oncology by -- people know that cancer is not infectious. if i put cancer cells into an animal the animal would not get cancer. the reason is the animal has an immune system. occasionally, a patient with cancer will recover and what is happening in that case is that the immune system is somehow able to recognize the cancer. biologists try to figure out what it is that keeps the immune system in general from attacking cancer cells and has learned to unleash that innate
ability to attack cancer in a patient. caroline: where should we be looking in terms of future trends. should we be looking at certain geographies where these steps and breakthroughs are being made? >> there unquestionably reaping rewards. i do not know that they are necessarily geographic system is -- specific anymore than industry and science are geographic specific. but the breakthroughs are coming from a combination of the science and the technology at an ever-increasing rate and basically, there are multiple ways that we now think about and are able to affect cancer. block the growth of cancer cells and we can cause them to die and that biology was
what sent me to stockholm some years ago. we can also prevent the progression and the spread in new ways and all of these areas, coupled with new science, is what is leading to breakthroughs. caroline: thank you, very much. it is not often you get to speak to a nobel prize winner. that breakthrough is getting ever closer. jon: an important topic. but keep it on technology. sanae has teamed up with fe, looking at new ways to battle diabetes. reporter: this is about helping patients and doctors battle disease. about making doctors from reactive to proactive and preventative. it will be smart delivery
devices and smart measurement devices. devices that monitor glucose and can upload that to the cloud. teamed up with other contacts working on lenses with tiny sensors. reason there is such a focus on diabetes is it affects 382 million people worldwide and we have to mention the cost of that -- about $245 billion a year in the u.s. alone. jon: thank you for breaking that down. up next -- a lot of data coming through. the italian pmi slips the french pmi deeper into negative contraction territory. unemployment data after the break. ♪
this world down lower by 3%. it is the morning and it is about data. chinese manufacturing coming in at a three-year low. you kate manufacturing a little manufacturing.k. a little bit later. unemployment faces 6.4%. so that is 7000 slightly better. a manufacturing pmi coming in slightly better than expected. let's get more of those german .umbers much more on how this labor market plays into the refugee story. what can germany due to absorb these new refugees. i guess the pmi number is coming
in a little bit better than expected. weake is weak, italy is ,nd germany -- while not robust seems strong and seems to be modeling through the crisis -- muddling through the crisis. one quick thing, the overall rate did not change and when you look at what happened last week, we had a surprise increase in the total number of unemployed. --some ways, the pmi number even though this is revised and the final rating is a little bit more important to me than the unemployment line. jon: 56 minutes into the trading session in europe. we kickoff september on a low. the stoxx 600 lower, the tax at a session low -- the dax at a session low. you can follow me on twitter. for more on the market. best of luck with the rest of
china's manufacturing myths slumps to a three-year low. stocks have their biggest two-month slide since 2008. the biggest three-day rally and a quarter of a century. chancellor holds a news conference this hour on the crisis facing europe. welcome to "the pulse," live from bloomberg's european headquarters. i'm francine lacqua. chinese