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tv   Countdown  Bloomberg  February 3, 2016 1:00am-2:31am EST

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can chinana make a bid for the pesticide maker? asian markets tumble for a second day. below $30 a barrel, eroding confidence in global grade. and searching for answers, shares fall after hours as marissa mayer unveils the latest turnaround effort. is this her last chance? ♪ anna: welcome to "countdown"
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i'm on edwards. mention this and i headlines, china has made an offer. per share, that is in cash flow to that compares to a monsanto offer previously which not all ins francs cash. not always comparing apples to apples. remain a global company centered in switzerland. -- thepany could management will stay in place. perhaps the company will be delisted. we will wait for confirmation on that. they're saying that the existing management will continue to run the company. we're getting numbers out of them in terms of how they perform. $13.4 billion against an estimate of $13.5 billion. a 2.7 $7r coming in billion. a little bit above estimate on that. they are also saying the
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full-year diluted is coming in at 17.7. they enter into agreement on february the second. they're saying this morning at the syngenta offer is equivalent previously, the offer had been at 4070 for the month. that wasn't all in cash. this testing to be more cash. getting confirmation this morning that china makes a cash offer to buy syngenta. this makes it the biggest chinese takeover we have seen so far. we have seen the chinese equivalent overseas in recent years. of course, in various appliances and entertainment. let's break off from this conversation and taco little bit about the oil price. that has been moving asian equities around.
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+++ let's show you this is what is been happening at the u.s. shale boom. we have the wti forecast according to analyst for the expect that to be in the fourth quarter. coming through the red line, that is the new news i want to show you this morning. a survey shows the community saying they expect to see to the ti prices at $46 a barrel in the fourth quarter. that would be an increase by the end of 26 -- 2016. if you're looking for some to support, perhaps you can rely on that forecast to do that. that won't help you in the overnight process, at the very top left, wt i had 29.73 right now. that u.s. benchmark losing a little bit more ground overnight. but each digest already this morning. let's get the bloomberg first. crude is trading below
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$30 a barrel again after a fresh selloff on asian stock markets. plunged, thees most in two weeks with some of the losses in hong kong. oil saw its biggest two-day drop it over seven years. ,rude stockpiles increased exacerbating a global issue. analysts are suggesting low prices will climb by 50% by the end of the year. they could reach 40 60 is a barrel during that. -- $46 a barrel during that. the bank of japan says it will look into the a report that does the board was discussing a negative interest rate policy. that is just minutes before the surprise market announcement. on the governor and his colleagues were in the closing stages of a policy meeting. the first low-key transmitted case of the zika virus has been confirmed in dallas county.
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that came a day after the outbreak and its potential association with birth defects was declared a global public health emergency by the world health organization. a patient became infected after having sexual contact with the sick person would returned from a country with the virus was prevalent. meanwhile, it is forced a new car's a they said the new name will be announced in a few weeks. zuckerberg be in the fourth richest person is facebook shares fended off plunging stock market. deal founder of the largest ocean our cap a $50 billion fortune by the close of regulation. that vaulted him above jeff bezos on the bloomberg billionaires index. anna: secular much, let's get
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up-to-date with the asian equity section. david inglis is standing. is happening with oil, not a pretty picture. it seems that equity market not taking the positively. absolutely, it is a very bad day. one of the terry bad days to be an equity investor. north of thread billion in market cap and the northeast. we heard from the governor about selloff three hours back. driving its point, they remain committed. the current conditions don't -- they are open to being creative. below zero further are a possibility, and really driving his point. yields are continuing to come down in japan. we can't imagine how low these guys could get. they are continuing to find new
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floors. across a lot of these different maturities, we get lower and lower. 13, of what happened to the eighth year on the yield curve in japan. is actually below zero. let me point out of this -- have a look at the nikkei, the worst market in asia are hong kong and japan. you have two measures of volatility here. 20% today. up that would be the biggest jump going although it back to the chaos in the summer. have a look at what is happening on the hong kong, a similar of about 16%. an overview of the equity markets, all right. a singleong kong, not spot it up on the hang seng. single one is up. again, quite a bad day.
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at the moment, we are at session lows. thank you very much. joining us there from hong kong. let's get further analysis on that syngenta story. offered toecting and come through along with the results for stubbing up an offer from china. it looks to be worth a little bit more. it is an all cash offer. that was what the last offer was, and even higher than the previous one at 400 49. also, be jim he offer last year from on center which came in at 470. we can see why this is going ahead in terms of the numbers. what we're talking about is a than $43h more billion. that is the biggest ever
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acquisition by a chinese company. what the company has to get out syngenta gets more access to emerging markets and of course it is come under pressure after the merger. but can china, this is not just about the company -- this is also but the chinese national interest. into boosting agricultural output and acquiring foreign companies in order to do that. with any dealhere is over whether there would be any antitrust opposition. interestingly, that doesn't look so likely. simple because syngenta combining with the existing agrochemical business would still only result in a 19% market share. perhaps not so many disposals needed for syngenta. in many ways, this deal was more favorable for syngenta and the one with monsanto.
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he mentioned antitrust concerns, other concerns the regulators might want to get involved with -- they are talking about things getting into the food chain. u.s. authorities might want to look into things like that. constitute critical parts of u.s. infrastructure. that adds another level. nejra: absolutely. this will end up on the desk of foreign investors most likely in the u.s.. why? any authorities look at is deal that could pose a threat to national security. of course, we're talking here about the food chain. also, it is about syngenta having operations in the u.s. business unitso in the u.s. also, with some of these deals, it is about whether any of these businesses are near any military or sensitive site the u.s.
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as far as we are aware, suggested does have a unit around 80 miles from a site in louisiana. the could be questioned over that as well. other than as a blocking the deal, it is hard to say. certainly, that could be a stumbling block. anna: interesting what will happen there. thank you very much. let's talk about a swiss company making headlines. estimates, and crucially planning a share buyback. that is up to one billion swiss francs. interestingly, they saw positive growth compared to the previous year especially in mainland china. if you're looking for positives out of the china story right now. let's get more the oil story this morning. crude is trading at $30 a barrel.
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ryan, good morning, what are we expecting? that was the biggest fall in seven years? extraordinary, and 11% drop monday and tuesday. the concern is that the supply glut only continues. we will see, but the forecast is that inventories in the united states are set to rise. data for, that is based on a forecast we got from api yesterday. also, a bloomberg survey we did the day before that. people now are beyond that conversation about whether the russians will team up with opec and cut supply. everybody has now dismissed that and are returning to the picture we looked at before. anna: interesting. oil is the trait of the year. this picks up nicely to what analysts are saying about the rest of the year. ryan: it is time to buy that storage tank and start storing
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your petrol in the backyard. [laughter] i was thinking about it. a dozen than they have analyst that we spoke with estimated that the price of crude blew from $32 a barrel only are right to $48 a barrel by the fourth quarter. that would be healthy 50% rise. if you look, from the first quarter to the third quarter they see it steadily rising. it's sort of, last week i think we were heckling glencore saying maybe they were too quick and those. something andw this is a good time to get into storing oil. it is almost as if goldman sachs and the others were channeling bob dudley yesterday. we talk about how he sees the ves, in the hal
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second half he sees a u.s. shale production coming off. , the energy the eia statistics u.s. government, they see u.s. crude production falling by about 620,000 barrels. you can see that just starting to taper off. i like the graph you have here. that is inventories versus the wti price. it is just continuing to climb here. there it is, what to expect? a drop include production, that we would see the inventories coming down. if that the graph is correct, we see that inverse relationship and in you, you can see the oil price rise. anna: we will see some less london petroleum. just had some earnings out. a loss on the net income. they continue to witness extreme volatility. we would get their thoughts. a later.your dat
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there, thenvices justdata and the pmi filling in the gaps. mortgage applications and employment. up next we keep that with theion going conversation just after a short break on countdown. ♪
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"cou welcome back, this is ntdown." those came out of the top of the hour. joining us now is the ceo of the business. great to have you on the program. let's stop a talking about your comments this morning that you made with your earnings release.
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you continue to witness extreme volatility in oil prices. what is your call for the rest of the year? we talk about how analyst see something in the mid 40's for oil for wti by the fourth quarter. what is your expectation? morning, iine: good think as i said previously, for the first half of 16 a think we will continue see volatility in the market until the oil side in supply-side will settle. the second half we will see some improvement. will seehe impact we on the investment in the industry. also said the battle for market share is approaching its final conclusion. is that a comment on the sound is versus the shale drillers? alexandre: i think that is exactly what you just said, there's been a battle for market
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share. i think we have seen dramatic reduction on the number of rigs in the u.s. we've seen a rejection -- reduction in bavaria. the off shale industry is 30% of total production is going to massive production and cost. we will see venture the impact of that on their investment. anna: you expect supply and demand to come into balance. it sounds as if that time is not very far off. bp yesterday and he was talking about the second half of this year when things should be more endowment balance. would you agree with that timeframe? alexandre: it is always difficult to predict, i would agree that there will be a supply balance and it will change. we will see the opposite eventually because of this investment in our industry. timing wise, it is difficult to figure out exactly. i would expect that we will see the impact.
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that is in the second half of 2016. anna: he said your cost of operation performed below $10 a barrel. that means your profitable at anything about $10 a barrel? those $10 on our breaking costs. that is what we pride ourselves. on stream aght greek field and we operate with 50% equity. this field is a new facility and low breaking costs. a megaproject, and an operating cost of that will continue to increase from $10 level to below $10 which is an ideal position to be in. it is amenable to the oil price will go to $10, no. for: that is good to hear many people, i'm sure. you are a business focused on exploration.
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is there a time when you can secure better rates from suppliers? should you be going out and doing more exploration? course you have to take the opportunities as they come. there are benefits to the low oil price. one of the new just mentioned, re-grades. yet to be optimistic and realistic about what is happening around you in the world. and we will be going out continuing organic growth stories. we will continue to explore and taking full benefits of the market today. it is a balancing act between expiration and development. they recently acquired 4% of your business, are you expecting them to take any further ownership and to the stand in a position to block any other interest in your company? question: i think the
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if they will take more is something you have to ask others. i believe not, secondly, i think it is a testimony that they're prepared to buy a premium on the equity market it is because they know that assets very well. they got a high regard for those assets. i see that as very good news. at this point, they cannot block. you said that you come in terms of your operations, once you take advantage of low rig rates, what about deals of your own? it is not part of our main strategy, but we will be optimistic if we see interesting deals that are strategically interesting for us. we would certainly look at them. anna: thank you for the much for joining us.
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yahoo! ceo morris meyer has long argued that she can for the struggling web business back on the path to grace. could you finally out of options? she said she would consider part of the core assets up for sale. staff has been cut, and offices have been close. she's optimistic about her plans. >> i never believed more in this company. product,ople, and the and the inherent value of what we do. to be clear, it is a strong plan and a bold plan. we have the full support of the board. anna: caroline joins us to bituss the overall a little more. some dramatic news perhaps coming out of yahoo!? caroline: it is a bold plan, it had been well expected. it is not living up to many expectations. you are seeing 15% potential cut and overall employees. it is about 1500.
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they're getting out of games, and smart tv. they expect to cut costs by $400 million by -- per year by the end of this year. it is not all quite music to investors years yet. we will focus on the main business, the mobile and video and native social platforms. they are reversing spinoffs. they're taking the target business off. that would be done by 9-12 months. what they are worrying about and have already put on the table potentially is the more extreme version of events. consider a complete sale of this business. she is considering putting the company's core assets up for sale. they're open to any transaction or any proposal. caroline: if there were to be a sale, who might be interested? caroline: i think some of
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already raised a hand in this. keep an eye out for verizon communications. remember,ed up aol, and would be quite a good fit. yahoo! still does have a lot of rivals. the sill of one billion users, more than that when you look at news and sports products. that could fit nicely into a telecommunications verizon already offers. also, private equity could get involved. remember, 3.5 years at the helm for mercer myers. she is already slashed jobs. but the really desperate thing investors want to see is more drastic action, changed of the top and management. anna: talking with the management, caroline, thank you. we willh bloomberg, speak with marissa mayer don't miss that conversation on
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bloomberg a little later on during programming. falls below $30 a barrel. is there a future for fracking in the u.k.? ♪
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"co: welcome back, this is untdown." nejra: china has offered to buy syngenta. to plan to take over the sea make it comes as the state backed company extends its shopping spree. the cash offer be the biggest acquisition yet by a chinese firm. below $30 is trading a barrel, triggering a fresh selloff on asian stock markets. they had similar losses in hong kong. oil saw biggest two-day drop in more than two years.
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-- seven years. and was are projected oil prices will climb by 50% by the end of the year. reach $46 a barrel during the fourth quarter while brent will trade at $48 in the same time. that is compiled by bloomberg. the king of spain has asked the socialist leader to find a solution to the company's political stalemate. lending moral approval to the negotiations. that is following consultations with the leaders of all parties. the locally transmitted case of zika virus in the cut that of u.s. has been confirmed in dallas county. that confirmed after the outbreak was declared a global public health emergency. a patient became infected after having sexual contact with a sick person who let returned from a country where the virus was present. mark zuckerberg became the
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world's fourth richest person as facebook chairs -- shares fended off plunging stock prices. that defaulted him above jeff bezos on the bloomberg billionaires index. global news before hours today powered by our journalists and news bureaus around the world. is amazing how rich one can become overnight. let's talk about the spanish bank. would tell you what their numbers say about the performance was at the net profit coming above estimates for the fourth quarter. at 824imate was set euros, that is moving in the right direction. their capital ratio also fully loaded racial 10.3%, an
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improvement over september's number. numbers coming in better than estimated. capital for a much in focus in this sector as a whole. the concern was whether the situation would dampen the performance and lasting america. this is a business where capital the commission is key. there has been a disappointing level in the third quarter. rebuildatching as they their capital organically over at bba. that is the spanish banking, let's check of the life market action with caroline hyde. that a weakness in the oil price once again wreaking havoc across asia. is, it isit really the thrust of what is driving the markets lower. having its worst two days in seven years. we didn't realize these considerations could still be happening. that this volatility could still be so extreme. down more than 11% over the last two days.
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brent is still trading at a relative premium. certainly, we are the beauty i had $29, that is we saw an uptake in the oil market climbing 4 million barrels in the u.s.. that was for a much on the investor's minds. this is dragging down the topics at the moment. drop in thegest japanese benchmark in two weeks. we're seeing that currently down about three percentage points today. nomura's down by 11%. the reason is that the numbers were disappointing. they're having a target to overseas parts of the business. down stocks in japan. look at futures for the u.s. and the u.k., both signaling a down day once again.
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meanwhile, the flight continues. money going from the u.s. treasury and going into australian bonds. tracking down the yields of the moment. keep an eye on australian bonds. that is the picture being painted for stocks coming up for the rest of the day. we could see it down by some money moving out of the riskier asset moving into the safer assets. thely leading some of improvements there. falling by a two basis points. the search goes on -- eight basis points. the search goes on. up .3%, this is the world currency rancor we have a bloomberg. phenomenal, it was only on friday we saw that injection of stimulus and the cutting of deposit rates. the yen has made back half of its decline since friday.
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anna: thank you very much. let's get more breaking news. the pharmaceutical business of course operating out of denmark. focusing for a much on diabetes, their next number looks to come in just a shade below estimates. 8.26et profit coming in at danish krone just low of the 8. 45 estimate. they're planning to buy back some of their shares that could be some interest to those invested in that business. they won't yet set long-term margin targets. they see long-term target staying at current levels of the 44%. not a bad performance over a five-year time. business inis
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telling of a sweet spot catering to those with diabetes that need insulin delivery systems. with the u.s. oil back below $30, what does the future hold for fracking companies? let's speak to the ceo of one of them. he joins us now in the seuss -- studio. your company several for from the headlines. an update on where you got to in appealing against local governments. francis: we're applying to drill some wells in the appeal process as you say. that appeal starts next week. it start on tuesday in blackpool. it is quite a lengthy process. we would expect a decision problem more towards the middle of the year. anna: perhaps a decision is it possible you still start proper activities -- fracking
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activities -- by the end of this year? francis: we hope to start drilling by the end of this year, fracking by 2017. anna: how far behind your expected timescales are you right now? did you think you'd be doing more fracking and more drilling rather than politics? francis: yes, i think the risk was quite a bit different than what i thought. i would say that on average, with about two years behind schedule. assuming we do get approval, which is an assumption. we are confident we have a very strong case. about two years behind we hope to end -- and have some resolve. have been some local objections. that is given quite a bit of attention to how the industry relates the local community. maybe trying to give some benefits of the drilling activity to the local community.
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do you think that is where the balance is wrong in the u.k.? otherwise, it would've resulted in a different outcome? it is like in thing you start a new, particularly infrastructure projects. hsh seen this with peter and two, it takes time for the to develop. there is local versus national balance to be had here. proved to be successful it is a huge national resource. as well as a big thing for lancashire. we have to strike that balance. talkinge government is with the shale well-funded saying it could be worth one billion pounds back in november of last you. is that enough? francis: the resource come of the month of gas and the ground is very large. we think there are hundred trillion cubic feet there. but we don't yet know is how
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much we can get out of the ground. if they prove successful, then those kind of numbers are potentially to be had. anna: we have seen objections to fracking in the u.s. what do you learn from what you the u.s. example of how communities have been brought on board? i appreciate all commuters have not been. are seeing inou the u.s. is a revolution over time. it really in the environmental safety performance of the companies. there are some companies that did not do it very well to begin with. i would think now that the u.s. certainly has improved considerably over the last 10 years. in the u.k., if at a long history of oil and gas experience. we are widely acknowledged to be one of the best regulation industries in the world. anna: we're talking but gas here, why do we talk about oil.
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what to do you think, when you look at the weakness we have seen in energy prices of late, how does that sit with your longer-term forecast? isncis: what we're seeing very simple in some ways. it is supply and demand. now in the oile market were clearly there is excess capacity and excess supply. that is resulting in this volatility. if we look at where we are operating which is the u.k. gas market, the prices have come down. what we see in terms of supply and demand balance is domestic supply is running at an alarming rate. we are importing about half of our gas. by 2030 come all forecasts are that will be about 80%. what we need is imported lng and are confident that we will be able to compatible with imports from africa and the u.s. to line anna: what kind of prices do
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need to see to make a profitable? alexandre: i suspect it is run five dollars a barrel compared to the u.s., i think they would need to see north of five or north of six. thatis if we prove commercial flowrates we get into develop in the economic industry. anna: if level stay right now, does that pose a threat to the business going ahead? francis: i think commodity markets are never just about planning. we don't control the price. what we control is cost, and we have to get our cost competitive. we are at the early stages. to put ahe opportunity cost structure in place that will be competitive. i think we have seen how remarkably resilient u.s. shale has been to oil prices. i think a lot of people thought that $50 oil would be driven out of the market. it is so going even today. it will come back. anna: are you surprised at how
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stubbornly shale industry has been in the u.s.? how many conversations do you have? francis: one of our key investors was a big investor in the u.s. we do have contact with u.s. markets. i met holy surprise, i think the real story of this unfortunately has been the impact on the north sea which is a much higher cost producer. we don't here for a much about the job loss. it is one of the jewels in our crown. unfortunately, it is being decimated by this. anna: you are not in a position if you get the green light and are planning that the rules going a favor that you have a wealth of talent pool to pick from. thecis: not just us, but u.k. is uniquely positioned in
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europe because of the heritage of aberdeen. the store else in europe that has that capability. the u.k. could lead to europe. anna: if anybody's going to frack in the u.k., you're going to get there first? they may do a virtual well first, but we will be the first to have a horizontal well. anna: thank you so much for joining us this morning. gears, aia shares have slumped after china may face restrictions on the buying of overseas insurance. this was a very active story for the london market yesterday. we saw prudential temporarily suspend trading. let's get more from sherry who joined the stuff from hong kong. first, take us through how exactly people are using these insurance policies. this is all about how insurance policies are used by chinese
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consumers, not so much about whether foreign businesses have the right to supply chinese customers. right, what a mainland chinese people have been doing for a long time is coming into hong kong and buying insurance policies as a way to get the money out of china. and use yourhere union pay credit card and can buy a million-dollar hong kong insurance policy and have that money outside of china. it is a way of skirting their currency controls. money free toyour cash out of your policy, or buy real estate in sydney or vancouver or london. that is a way that even the insurance regulator last year could be a potential threat of the money laundering in hong kong. the restrictions that china seems to be now putting into place are restricting the amount
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of money that you can spend buying an insurance policy for the particular the, using your union pay credit card or debit card. anna: it seems like you're in u.k., we saw this yesterday, that some of the names is the internationally insurance providers are going to be scratching their heads and trying to work out what extent this threatens the business model that it is built on. providing more of this financial service to the chinese. break down these restrictions and which ones could be hit the hardest. sheridan: we've seen the major beneficiaries of this rapid buying of policies being aia in particular, and prudential's operations here. even a lot of the smaller banks as well as part of their wealth management services do also offer these types of insurance products. they are in some ways a fancy and othernnuities investment products that are wrapped into an insurance policy.
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that is not to say that people are generally looking for health insurance or life insurance or premiums. it is much higher than it was back on the mainland. that is one reason to do it, also the fact that you can get your money out of china. it is protected once it is hong kong. it can't be seized by creditors in the event of bankruptcy. or if, the chinese person were to be investigated anticorruption crackdown, that money is still shielded here in hong kong. that has really been driving and really benefit in the major insurers here in hong kong. that is why they're getting hit not just the units here but also worldwide. it does account for quite a lot of their sales globally. anna: thanks for breaking down at complex story for us. we will see a prudential shares perform a day after that news
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was digested by the markets. debate, with the brexit effective rate hike? ♪
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let's getome back, the bloomberg business flash. buy's china offered to agenda for more than $40 billion. it comes as the state backed company extent it shopping spree. the cash offer will be the biggest acquisition yet by chinese firm. swatch the port authority 15 earnings that missed and -- reported 2015 earnings that missed analysts estimate. it waser of watches said hurt by slumping demand in hong
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kong and the strength of the swiss franc. shares have slumped in hong kong after bloomberg surfaces -- survey said they could buy overseas insurance. authorities are stepping up to slow capital outflow. bloomberg intelligence estimates $1 trillion last year. yahoo! fell in extended trading after it is considering strategic options for cutting 50% of its staff. the company said it will read -- use more resources. toissa mayer is facing calls step down as investors questioned her strategies to boost growth. we will speak with her on bloomberg this afternoon. that is your bloomberg business flash. now the bank of england will keep interest rate on hold until after the eu referendum. that is what officials say. there are now looking at an august rate hike, not february
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as previously predicted. .unt nichols joins us now -- hans nichols joins us now. lots of people here have been talking with how you wouldn't want to increase interest rates during a time of such uncertainty. that markets aren't really expecting any kind of interest rate. couldthgat co -- that already be priced in. one is the oil story which isn't going anywhere. two, you wouldn't want the mbc reverse itself. you would actually have to go ahead and have a rate increase than a referendum and have it go the other way with the u.k. leaves the eu then in the position of turning around. when you take a look at their inflation numbers, they say it will come in at 0.3. those are almost continental numbers if you think about it. then, this idea what you will have to happen in terms of a
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reverse that puts you at an august rate as mentioned. we have an of the story out from bloomberg intelligence, just what the shock of the u.k. come would be if there were an exit. it would hit confidence, currency, really a triple threat. take a look at this graphic, here is what they are saying. you can see an effect of the pound of. you can see interest rates going down. the one thing that would not, is would have inflation that an ugly picture for the u.k. economy. this is a projection, economists are saying it is a projection, this is the best guess on what could happen. this is a concern that it would have a negative impact on the economy. everyone is now reverse engineering that is saying this is what would happen. anna: thank you very much. a report yesterday
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meeting with a great deal of reaction. more to come on that as we go. the caviar market has judicially now in russia and iran, there's a new player -- japan. paul allen reports on an experiment that took three decades to come to fruition. paul: say hello to the world's atest caviar supply -- kept a constant 17 degrees of a fish farm in japan. the end product of a long experiment. the sturgeon was give them of the soviet union in 1983. we got it from the government institution and started studying sturgeon farming. aul: in those early years, they had little idea what they were doing.
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they just stuck to what they knew best. fact, we didn't know how caviar was produced overseas. we just started eliminating up purity's. -- impurities. aul: the hard work is paying off. the surgeon front now yield up to 300 kilograms of exit each year. it all ends for a badly for the fish, the consequences of having the equivalent of black gold inside their belly. a 20 gram jar retails for more than $100. preparing for sale is time-consuming and labor intensive. japan needed to comply with the washington convention which prevents the overfishing of sturgeon. they can now join the elite club of caviar exporters. paul allen is his
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understated normal self. up next, more on china's offer. it bears to make m&a history. ♪
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♪ anna: reap what you so. chemchina offers to syngenta and what would be the egg is ever a. the oil effects. tumble for thets third day in a row. searching for answers. ofres follow after hours bristol-myers -- marissa mayer's -- ♪ welcome to the program.
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this is countdown." i am anna edwards. to be some of the latest forecasts. currently trading at 29 .85. blue.hale boom in joining it for six dollars a barrel. asset in theedian endless space when you ask them where they think the oil price will be in the fourth quarter. that suggests we will see a movie in the price upwards. petroleum, we will be talking to -- london petroleum, we will be talking to them today. seeing reaction from the u.s. producers. they could drive a rebound. interesting to see that is what the market thinks. fallen to a 12 year low
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in recent weeks. let's talk about where we are going to open on the equity markets. that move in the oil price had an impact on equity markets over in the asian session. vicious suggest we will be weaker here in europe. suggest we will be weaker here in europe. a lot of m&a to talk about in the markets. not least of which, syngenta and chemchina. caroline: chemchina has offered to buy syngenta. the plan to take over the swiss pesticide maker comes as the company extends its shopping spree. the cash offer would be the biggest acquisition yet from a chinese firm. u.s. crude is trading below $30 a barrel again. a fresh selloff on asian markets. japanese shares plunged more two weeks.e most in
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oil has seen its biggest two-day drop in almost seven years. --. industry data shows exacerbating the global surplus. analysts are predicting oil prices will climb by 50% by the end of the year. brent will trade at $48 a barrel in the states. the bank of japan says it will look into a media report that says the board was disgusting a --ative that's a negative rate.sing a negative they were in the closing stages of a two-day policy meeting. the first locally transmitted case of the zika virus has been confirmed in dallas county. that came a day after the a globalwas declared
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public health emergency by the world health organization. the patient became infected after being infected dust at -- after having sexual contact. zica is due to make its debut today. a new name will be announced in a few weeks. the zuckerberg has become richest person. the 31 euro founder of the largest social network has a $50 billion fortune. that catapulted him. bloomberg news. anna, back to you.
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anna: let's check in on the live market coming out of asia. things were looking pretty negative. by in something negative rippling through the asian session. ana: it was all about oil today. bp and lotsts from of oil companies selling off. the oil stocks being in the biggest the klein. in japan, we're in a busy earnings season. numeral reporting a drop in profit. we saw their shares tumble and that led toward -- falling as well. anna: we've seen some of the insurance businesses weaker in the hong kong session. as a result of that story we
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covered earlier with your colleague out of hong kong regarding the chinese insurance businesses. thank you for joining us. anakin tanaka joining us. a quick word on what is been happening on the bond market. let's show you the german two-year-old desperate german two year yield dropping. -- german two year yield dropping. showing what we have seen in show many -- in so many durations and elsewhere in europe. stimulus continues from the european central bank. whether --tinues debate continues whether we will see more stimulation -- more stimulus. bono, great to see you.
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europe, we have seen conversations continue as to whether this will be the big game of 2016. no surprises seeing more of those developed market yields coming your desk coming lower. how does this impact -- coming lower. portfolio moved into emerging markets. everyone was searching for them here now, at this time, the ability of lower yield rates to anchor lower has diminished. you can say monetary policy is running into returns. been levering up for a long time. as a result of that, their group is coming down. their earnings have been very weak. their balance sheets has become infected. the slowdown is having some impact on bm as well.
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the oil sector. if you look at things outside of the oil sector, in the u.s., things are relatively strong. europe is doing ok but inflation has not picked up. if you look the u.s., europe, inflation expectations are coming down sharply in the market. that would be worrying the fed and ecb. anna: we will hear more talk from mario draghi. betweeng that link emerging markets and developing markets. a lot of people look at what happened with the fed. a lot of the problems in emerging markets were coming from the developed world. they say a lot of the problems that are being created by emerging markets are being created at home and those emerging markets. bhanu: you can barely see it on
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the chart. beenroblems in a.m. have -- in e.m. have been made in e.m.. is suffering because china is slowing down. commodities is slowing down. it doesn't have a plan b in terms of growth. from here, you're seeing weaker balance sheets. bearishness, we have not seen in the catharsis of the exit. that's why emerging markets, despite being in a spot, are not very cheap. anna: then you have to think about what the fed does next. d.c. the fed becoming more dovish. if so, what impact would that have on emerging market wealth? bhanu it is important to place
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the horse and cart and the certain -- in the right order. happen ifonly volatility rises much further. that will only happen if emerging markets are suffering more. if the fed was to become more dovish, you would have already seen emerging markets selloff. once we get to that point, perhaps emerging markets rally. let's be careful what we wish for. we look up in six months time, the fed is more dovish. by that time the emerging markets have sold off 20%. -- bhanu as we come out of a world where monetary policy rules, we are steadily but slowly going into a world where normal things apply again. where good things -- where good news is good news.
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anna: do you think we are exiting a world where monetary still going : monetary policy is still very important. it is driving assets. the market is taking back the fed hikes. the market is not expecting more fed hikes this year. the nikkei is down 3%. the ability of an incremental easing to push of asset prices is diminishing. this is not a zero and one change. the ability to monetary policy to control asset prices -- marketsead of emerging -- the head of emerging markets at ubs. later, we've got pmi coming out.
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get numbers from germany, france, u.k. and the eurozone. rolling into the afternoon, in terms of u.s. data, we get services pmi. -- it is 7:12 in london. up next, the bti just below $30 a barrel once again -- up next, the bti drops below $30 a barrel once again. ♪
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anna: welcome back. 7:15 in london. let's get to bloomberg's business flash with caroline. caroline: chemchina has agreed to buy syngenta. it comes as a state backed
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company extends its shopping spree. the offer would be the biggest acquisition yet by a chinese firm. sales declined for the first time in six years. operating profit declined 17%. was hurt by watches slumping demand in hong kong. slumped in hong kong. that is after bloomberg sources said china may place restrictions on the buying of overseas insurance. slow outflows. apb fourth-quarter profit missed expectations. the company says growth in china was slow in 2016. to $204me decreased 70% million. that included a half billion
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dollars. tradinge wti crude is near $38 a barrel after the biggest drop in two years. that is the biggest move into days. for people to say oh well these things happen, it shows you how far we have come. ryan: the volatility has been so extra never, if it had been pointed out, i'll i am not sure that's i am not sure i would've noticed it. -- i am not sure i would've noticed it. this is a big drop. biggest since 2007. not bad for 48 hours. every time we get one of these drops arises, somebody has to blame it on something. this time it is the inventory report. we are getting a forecast. we get the api forecast yesterday.
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it shows people think last week inventories in the united states rose by 3.8 million barrels. but we areole lot already at a record level last week. for beingher argument concerned about this supply glut. .- supply glut continuing that is what people were trading on. let's see what happens when we get the number from the eia this afternoon. " we saw -- anna: we saw more rate action. -- they done something similar in europe. what are analysts saying about where the oil prices? ryan: the oil price is set to rise if you listen to the dozen and a half analysts that we surveyed. they all think on average the oil price is going to go up sort
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of sequentially over the year to a whopping $40 a barrel by the fourth quarter. $48 a barrel by the fourth quarter. last week when we were heckling , maybe going court maybea little bit more -- when court knows a little bit more about this industry than we do. there is the consumer option which is to put the storage tank in your backyard. petro is going to go up. that is interesting. it is a most as if the analysts are channeling bob dudley. this is what he was saying yesterday that ok the first half of the year is going to be choppy. is because we have this iranian oil coming on market. the second half of the year he
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this non-opec production specifically shale production coming off. yet a says the u.s. production will drop 620,000 barrels a day. that is not the 2 million barrels a day of oil glut that we have now. it goes a long way to the other part of the supply demand equation is because oil is so cheap, because people are paying $1.50 for gasoline. fuel. are buying more not just obviously for the cars or suv's, which they are buying like they're going out of style, but factories so the demand to go up as well. anna: this is wreaking havoc across the emerging markets world. whether it is nigeria or the selfies considering selling off
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their crown jewels. whether it is the russians talking about selling off assets. what about the emerging markets worries you the most? bhanu: china. that is partly where much of this is coming because the oil price is a sentiment of lack of demand. changing technologies in a sector which consumes oil more than any other sector. that is one of the reasons why i think analysts have to be humble about being able to predict the oil. it has not yet reached havoc in emerging markets in the same way it has in the u.s. high-yield market. if you look at emerging markets credit which is
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where many investors -- it is not in the equities, it is in the credit space. that is why you have not seen the defaults. it is what do hurt the sovereign even chilly good -- sovereign eventually. the sovereign biggest to suffer, unlike the u.s. high-yield market. it continues to come down. here you are copper much in the credit of mexico, malaysia, russia. compromising the credit of mexico, malaysia, russia. the infection is slower but it is much broader in emerging markets. that is something that is not in the prices yet. i think we're going to continue to see that pressure. they don't want to devalue anterior.
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-- devalue nigeria. the currency does have to move. anna: one of the currencies have been talking about is south africa. there we are seeing a country started to coke with the declines in prices. would you see that investment story going? where do you see that investment story going? -- south africa is a big oil consumer. that is exec he what south africa is not prepared for good metals prices are declining. the currency has gone from 6.5 to a solid 16. the market is still quite long to afghan bonds. the markets are going to do you rate in both of those assets. the currency is going to continue to go. beautiful country but not a
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great shape for the economy. anna: bhanu, thank you very much. yahoo!'s ceo marissa mayer has long argued that she can put the struggling web business on the path to growth. could she said she is considering putting the core assets up for sale. she is optimistic about her plans. >> i have never believed more in this company. the people and products of what we do. to be clear, it is a strong and bold plan. one we are embarking on with the full support. anna: bold plan she says, caroline. caroline: inherent value in their assets.
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investors do not agree. we saw the shares falloff. we didn't see quite the optimism that marissa mayer was trying to talk. dramatic changes. really moving to where the activist investors are trying to push her. she says she will consider the sale of the core assets. are there assets maidens business did the video, the social platform. she is also taking drastic steps to try and secure this part of the business. about 1500 people to go to the closing officers, including that in dubai and mexico. $4.5 billion impairment charge really underlines the struggle this does is has had for more than 3.5 years. leading it, she has been making up acquisitions. now she has to write the value by $250that company
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million, struggling to keep up with facebook and google. drastic changes but overall, the activist investors not only one her to sell the overall heart of the young business, take away from the asian parts. notably they want her head. she is desperately trying to protect her job. anna? anna: caroline hyde with the latest on yahoo!. sick with bloomberg -- stick we are going to be talking with the yahoo! ceo. chemchina set to purchase syngenta $443 billion. the acquisition will be the biggest ever by a company in china, really under scoring china's ambition into food security.
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on the move this up next. we will have a weaker start to trade. on the move will be talking to the north's ceo. ♪
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>> welcome to on the move and we're counting down to the european open. i'm guy johnson alongside jonathan ferro. busy morning. jonathan: busy morning. the wti back below $38 a barrel. the first downgrade since the depression. guy: other big headlines coming up. talking about the service data. data out of japan and china. italy. get spain and 8:59. story,n: the other big


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