tv Bloomberg Daybreak Europe Bloomberg June 12, 2018 1:00am-2:30am EDT
♪ anna: good morning from bloomberg's headquarters in the city of london. i am an edwards. -- anna edwards. >> these are your top stories today. ana: trump and kim share historic handshake, expressing optimism that they can and decades of -- end decades of hostility. theresa may urging lawmakers not to weaken her hand with parliament, with brussels and parliament vr flagship legislation. madame lagarde ones of
increased risk for the economy amid the acrimonious g7 summit. ♪ ao everybody here in europe. mrs. -- this is "bloomberg daybreak: europe." my colleague joins us from singapore on this historic day. we see amazing pictures of a trump and kim walking together in the gardens of the hotel in singapore where they are meeting. we understand that some sort of an announcement is due shortly? >> that's right. an announcement any minute now. trump says that the meeting was fantastic. in a lot of progress was made, a lot more than anybody anticipated. on the way to the meeting trump was pretty optimistic already.
he said they have overcome a lot of challenges to be here come a point that was also made and here, a point that was also made and shared by kim. this is a historical summit for the two leaders. expressed bynce trump that we will get this signing, some sort of agreement, we do not know what exactly. markets have reacted tentatively. a slight uptick in the msci asia-pacific. kim did not speak, but trump making these very brief comments to gathered media. the msci asia-pacific up 0.2%. we saw a movement in weakening yenhe yen it as it were -- as a result of trump's comments. the pound very much in focus for us right now as well.
1% thisnd losing 0. morning. for what they say about the cnion as well. all of that takes place in the theater in the u.k. parliament in the next couple of days. there is negativity around u.k. assets. let's talk about the futures picture. this is what we see from the u.s. futures at this hour, looking as if we will be in a slight holding pattern, with an upward bias coming through. also the u.k. politics story, and we will be talking about the oil price. talking towill be the cfo of equinor asa, that is hans jakob hegge >. this is the new name for statoil. he will be joining us from paris
at 6:30 a.m. u.k. time. let's get a bloomberg first word news update. singapore, donald trump has said that an announcement on the summit with kim jong-un is imminent. his comments come after the leaders met and had a working lunch on an island. they had expressed optimism about their discussions earlier. pres. trump: we had a great discussion, tremendous success, we will be tremendously successful. a terrific relationship, i have no doubt. top economicmp's adviser has suffered a mild heart attack. the u.s. president tweeted that larry kudlow is in the hospital and the white house says he is doing well. he has been a longtime confidant to trump and accompanied him to last week's g7 summit in quebec.
the ims managing director christine lagarde has said it to the global economy are rising amid signs of a trade war. clouds are getting darker each day, especially in the wake of the acrimonious g7 summit. that is where president trump turned on his allies and accused justin trudeau of the bank dishonest -- of being dishonest. u.k., teresa day has stamped down one rebellion s of her party and urged potential rebels to back down on another. that is as she edges toward a deal for brexit. gave his backing to a compromised amendment on customs arrangements with the eu. the governmentf has staved off our challenges as
landmark legislation goes to parliament today and tomorrow. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. kong withver to hong a check on the markets. >> thank you so much. you're looking at the equity benchmark here. i will take you through each of these. have a look at the equity markets today, they were mixed and swinging all over the place from that meeting. this is the hour that they actually met. when they closed the doors, yanis started to strengthen -- yen started to strengthen. the good thing is that when you look across the currency markets, the yuan is stronger and the yen is weaker. you put those two together and you get this across that we are watching -- this cross we're
watching. if this starts to point up than that means we are in trouble. that is clearly not the case right now when you have the japanese yen weakening against the south korean currency. when you look at the options market and the equities space, we are looking at the cost me 200 index.ospi that is trading lower as we speak. in other words, traders are betting that we are not going to go anywhere near term on korean equities. that could change, though, because this meeting is not over. anna: thank you very much. let's get back to our top story. we are very much talking about how much impact on the markets this will have. donald has said an announcement on the summit with kim jong-un is imminent.
we don't know what it will contain, of course. one of our correspondence joins us now. we don't know what they are going to announce, do we? >> no, we don't. we don't know whether this is just presidential yet tricks on theatrics onts -- both presidents' parts. he says they are going into the signing momentarily and more progress than anyone could have expected. one interesting part is that when he walked past with kim when he walked past the cameras, one reporter asked him if there has been any progress on getting north korea and kim jong-un on committing to denuclearize asian -- denuclearize asian --
denuclearizion. he did not give an answer to that. yours --is as good as your guess is as good as mine on what is going to be announced. donald trump seemed pretty optimistic. it does seem that what is important is that reference to i.d.the id -- c.b. >> that is the state department parlance of our complete, irreversible, verifiable denuclearize ace -- denucleari e ion. that is a lot to ask kim jong-un to absolutely sign on to write away. north korea is in favor of if
they are going to go with what they say is complete denuclearizion, they see it as a slow progression overtime. donald trump and the white house team have said that before we can start making other concessions, such as sanctions relief, we need this first. mike pompeo said very clearly yesterday in a press conference, saying that we can give assurances to the north koreans, and we will give assurances -- unique assurances that we are not looking for regime change in north korea. that is something of course kim jong-un wants to hear from donald trump. bloomberg's chief north asia correspondent, exactly where the meeting is being held. joining me now in singapore is david carden, good to have you
with us. for both sides. david: we have clearly gotten past the first hurdle. >> are you surprised? david: i'm not surprised. both of these leaders needed to get past the first hurdle, but defining success will be different for each. >> trump has said he is about to sign something -- kim has said he was going to sign something, but we don't know what. what do you think it is? sort: simply to have some of framework going forward to have a conversation that ultimately gets us to a place where there is stability in the region. obviously it is going to be a process. i don't think anybody thought otherwise. the idea that something was going to happen immediately is a fantasy. this meeting could have gone sideways pretty quickly.
what we don't know is what was accomplished in the meetings prior to this summit. it looked like there was progress made it to allow them to sign some sort of agreement today. anna: good morning to you, david. some u.s. media reporting that perhaps we will get something acknowledging that talks are in progress, pledging to go forward -- keep going forward. with that they considered material enough -- will that be considered materially enough -- material enough? do we need something that talks directly?i.d. david: that depends on what we define as success. onsuccess is defined solely the nuclear ris -- denuclearizion, then there problems.
we have a population in north korea that has serious issues. in order for us to ultimately move forward, i think we are going to have to address some of those issues. manyve a populationhat of which do not have the security. what have a population were almost 40% of its children are stunted. we have real capacity issues involving north korea's opportunities to move forward. president trump said all too casually that you look forward to north korea joining the global economy, and having great success. i think there is a lot of issues that,re going to imperil and i think we are going to have to address those. is the moston important objective, but it is important to look away from that right now. anna: mike pompeo said that is
the goal, under which international sanctions when not be lifted. -- will not be lifted. david: it is a real conundrum. if you demand that there has to before anyrizion sanctions are lifted, you really limit north korea. the gdp of north korea as best we know is around $1000, per capita gdp. to simply say, we are going to beforedenuclearizion anything can possibly happen is something that north koreans are going to be unable to accept. what kinds of trade-offs can be made on it progressive basis --
a progressive basis? i believe that at the end of the day if the united states stays by the fact -- or to position that north korea has to denuclearize before this -- it does anything with regards to sanctions, or anything at all, i think it will be problematic. we will look at the longer-term picture in the next hour. before thisot event about how important the chemistry would be between these two gentlemen. from what you have seen so far today, does it seem as if the chemistry is right for some sort of deal to take place? david: that's very much what i meant when i said that we have gotten past the first hurdle. i think there is evidence that the chemistry has been good. i think both leaders lean that direction in any event, because
i think that both need this. at the end of the day the real issues are what can we do in the way of going forward. there are many substantive issues that have been intractable for some time now. anna: do talk about some of the can -- can you talk about some of the concessions that the u.s. would be willing to give north korea? how important is that? david: it is essential, existential for north korea, and i think it is particularly existential for the leader. they need more than words. they need something that leads them to believe that the words --. inan foresee a situation which there were to be international investment encouraged in north korea. that there could be a conference
of some kind that leads to redevelopment. if korea -- north korea is working with those kinds of partners, i think it would be very unlikely for there to bnef -- to bnef or to make a regime change -- to be any effort to make a regime change. at that point the private sector and other public sector partners would not countenance anything , as longegime change as there is confirmation that north korea is keeping its part of the bargain. anna: we are showing some pictures of earlier of the two gentlemen meeting and shaking hands. we are showing love pictures -- live pictures of the room being set up.
we do not see very much of china. how long is it china willing to sit on the sidelines of this process that they probably, crucially had a lot to do with? david: i would not say they have been on the sidelines. we don't know exactly how this has been functioning. china understood that the status quo was not sustainable. something had to change. i believe it china has been a proponent for those sorts of changes. it is unclear what china wants to s at this point, but that is also chair of it japanese, and the rest of the people of south asia. we obviously wish these talks well. it is going to take that kind of broad consortium, that brought engagement for there to be the types of services that north korea needs. what does kim want?
does he really want to see his country emerge in a way in which that kind of outside investment and engagement would be welcome? there are challenges internally once the north korea population begins to see that the outside world is very different than what has beenescribed. that is a conundrum for the leader to address. anna: how much of this -- support does kim have in terms of denuclearizion? david: it is difficult to say. >> he has removed top leadership in the military. topd: he has removed leadership and also people have been a threat to him. -- his approaches to leadership have been murderous. it is not to say that he is not prepared to move forward from this place, if he really does have the best interest of his people at heart. if.n, that is a big
i believe his interest in maintaining power is real. a country open up control and power that you have he may bvet it ise? necessary to do so, and he ma believe that it is not necessary to do so. i think the way forward is very difficult. anna: david, talking about the people of the korean peninsula, we saw the north and south korean leader already meeting. they have already done some talking. said that he had a sleepless night. what do you think success will look like from the south korean perspective in this very short time? and then longer, into the future, i guess? a continued comby the united states for the security of south korea and
engagement, in order to make certain that there is no disruption in this long-term relationship between the two countries, which has been extraordinarily important for both. i think it also makes lessening of tensions in the north. short-term, simply lessening the kind of tensions that ultimately are destabilizing. sometimes will talk about the uncertainties being something that have played to president trump's advantages in this negotiation. my view is that uncertainties are destabilizing at the end of the day. south korea needs assurances from the united states that we are therto stay. anna: how about the official end to the korean war? how significant is that? david: if you think about the end of world war ii, where there
were formal signings, and real investment in japan and europe to rebuild a shattered world. simply endg wars without doing that, has not proven to be very productive. world war i ended with any kind of -- without any kind of financial investment by the world in europe. we had the rise in the nationalism and populism that give us world war ii. treaty is a very important symbolic measure. it may be something that we see today. very well be the case that we are going to see some signing with regards to this. it is hard to know, but i think we are headed in that direction. i hope we remember the lesson that world war ii taught us, that not taking care of the stability of the combatants, that we do not want to leave that behind. it is important for us to make
sure we do not have renewed tensions. anna: i know you have drawn comparisons between that interwar period in the united states. he talked about the importance of sig also big able to provide security -- being able to provide security, financial leadership. is this something trump sees as something he will work on -- he and the administration will work on for decades into the future? question.ellent understood that we have to make the world one to live in. it required that kind of commitment. a world order or architecture was created after world war ii which has service exceeding
well over the last 70 years. unprecedented peace and prosperity in many countries around the world. if you are going to maintain that kind of architecture, which i think is essential, then we denuclearizione in the context of this effort. it president trump is committed to long-term peace, he will insist on that kind of international engagement. we have seen what just happened at that g7, we have seen the fact that he has not appointed ambassadors. we have not seen a commitment to multilateral engagement. we have seen a walking away from international agreements, and the like. these things are concerning with regard to his approach going
forward with regard to this particular crisis. it is unimportant and essential and -- an important essential goal, but we have to look past this and ask if the president is going to take steps to serve the international order. hope that the president will bring other parties into this conversation, and that in my view would be success, as opposed to simply saying we signed a peace treaty and we are going to talk about denuclearization. carden, thank you so much. he stays with us with his expert analysis as we bring you live pictures from singapore. let's get back out to bloomberg's chief north asia correspondent. singapore, overlooking
the venue for this activity is taking place. we see life pictures of the room being prepared for the signing. we still do not know very much about what they will sign. havingfact that they are a signing ceremony is good news, right. at least for the two participants who will be presumably signing. a lot of the warnings from the white house leading up to this re, what are willing to walk away if kim jong-un is not willing to commit to some form of timetable for denuclearization. obviously they have found some common ground to at least have some kind of signing ceremony. they both can take this signing ceremony as a sign of victory.
pure theatrics, if you will. unless that signing ceremony is going to be something completely concrete. we simply do not know. i am looking at the timetable for kim jong-un to leave. we have had various reports about the time he is leaving. south korean media is reporting 747 thatsame air china flew him from pyeongchang to singapore is currently on its way right now from beijing to singapore. -- i ame to arrive tracking get on an app. it is the same exact airplane with the same air body number. it is on its way and will be fiveand five hours -- in hours.
at least we have a little more clarity that we are going to see kim jong-un leave this evening. anna: anything to read into that? initially he met to leave tomorrow -- was supposed to the tomorrow. that was supposed to be the second day of talks. >> right. i think in the lead up to this summit, we have been hearing from the white house that they have been ratcheting down expectations. they are saying that perhaps three,uld need two, four, or upwards of five meetings to get this ball really rolling towards the conclusion that the united states wants. that is why i offer a little bit breaution as to the adth and depth of this
signing. i think it is speculation whether there could be any promises made in such a short time about sanctions relief, troop reductions in this part of the world. there could be a declaration th they will work toward the formal ending of the korean war, changing the armistice to a peace treaty. already donald trump has said that is probably the easiest outcome right now. markets, you are right to caution. the markets seem to be keeping their optimism in check. u.s. futures almost entirely flat right now. msci asia-pacific picked up just it -- ticked up just a little bit. this could have gone badly, in the sense that trump said he would know within a minute if
there was going to be the possibility of a deal between he and kim. clearly he saw something in it and now we find ourselves waiting for this signing. >> absolutely. they had all the time in the world leading up to how they wanted to show the wheir body language in those opening minutes while they were still on camera, before they went behind closed doors. initially it was kind of awkward, a little stiff. they realized, let's do a couple more handshakes, a few more smiles, talk some more. it got off to a slow start. the encouraging sign for me is working lunch together, took a stroll through the garden, walked past the cameras. believe me, if they had bad
blood they would not be walking past the cameras like that. the fact that they are saying they are on their way to sign something is a positive development that they did reach some kind of common ground, at least in the initial stages of what should be a lengthy process. is ultimate goal clearization for the u.s. giving theorea security pledges from the united states. anna: thank you so much, bloomberg's correspondent with us from singapore. more from him shortly and we continue to bring you these let pictures -- live pictures, the room been prepared -- being prepared.
joining me now is nannette hechler-fayd'herbe, the head of investment strategy and research at credit suisse international. .till with us as david carden great to see you. -- we are waiting for these events to unfold in singapore. what is your angle on what we see here in singapore? clearly there is a long-term picture of geopolitics and on.uclearizati nannette: i think there is a lot of symbolism at the moment in what is developing it singapore -- in singapore. there are aspects for civil society that may be brought forward. for markets, it was not very
much anticipation really, in terms of what markets could expect. sentiments could certainly be surprise positive. equity markets have been very much driven by sentiment since the beginning of the year. i think markets could take it what are some of the sectors and some of the economies that should be invested in? we see how the yen weakened two days in a row. there are opportunities out there. nannette: absolutely. the fact that the yen it has -- has weakened a bit shows you that the market is leaning toward a more positive sentiment.
and terms of the opportunities, justure, if you look at the south korean equity market, for example, which has been a bit strained in the past month, that could be a positive, given certainly opportunities in infrastructure, on the construction side. the construction sector i think on balance is going to move toward the positive on regional equity markets. anna: so there are implications. sometimes you need a long-term horizon to see geopolitics play out in markets. one of my colleagues was writing about this. geopolitics often operate at geological timescales. there is a lot for markets to focus on, the central banks.
is there any fallout that this might create or fallout that the g7 might create? nannette: for sure. at the moment there has been so many sources of concern as well as market movement. thelopment is geopolitical andnature and -- in nature may have a positive spin on markets, in particular risk assets. there are just plain economics going on, which markets have been distracted from over the past month. the federal reserve is due to take its next interest rate decision this week. have fully priced , so the fed is likely to do i don't really think that there is going to be much surprise. actually, the ecb could be more important for markets through
what it means for european bond yields and what it means for the euro. we have some headlines out of . someone from china's foreign ministry saying that the trump-kim talks creating new history. it comes back to the issue of trust. what i'm good if they sign an and good if well they sign an agreement here, but history has a shown that perhaps north korea cannot be trusted. it is about the future. >> it has walked away from past agreements. and is also true the circumstances are somewhat changed now. in the past when those agreements were signed, it was not in possession of a nuclear weapon and the missile technology that it has. that is a bad development in
every respect, but nonetheless it has changed the situation in fundamental ways. north korea believes it has sufficient reason to be more confident and is prepared to extend itself further than it had in the past. what kind of assurances can we give it? broughtal parties being intos convsation are i believe the kind of assurances that north korea should try to obtain from us. it seems exceedingly unlikely that there is going to be the sort of regime change that is of concern to him. -- kim. anna: another thing that has changed is the handover power from his father to kim. how much will we look back on history and say that that was perhaps a defining moment? how much is it the same regime that it was under his father? david: i can look back on past
history from this perspective, but i cannot look back on the present from historical context. we will see. --re is presidents of instances of kim jong-un operating differently. he was educated in the west. maybe he is more open to engaging with the west as a consequence. he may not have felt that he was able to do that from the first day. he now believes he is on a new level playing field as a consequence of the nuclear technology that he now has. if it is all about him, if it is all about maintaining his power, and not improving the lives of the north koreans, then i am not sure there is a lot of reason for optimism. anna: we talked about china being the invisible hand.
china would not want north korea and the u.s. to have a great relationship either? david: i think china clearly wanted to see a lessening of tensions. they would welcome any kind of lessenin of tensions. any agreement that does that would be very welcome. anna: sorry to interrupt you, david. of lie lived pictures pictures of president trump and kim jong-un. pres. trump: we're assigning a pretty comprehensive document. we have had a great term together, a great relationship. i will be giving a news 0, and we will2:3 discuss this at great length.
in the meantime i believe they will be handing it out. on behalf of chairman kim and myself, we are very honored to sign the document. thank you. [speaking korean] pres. trump: would you like to say something to the press? [speaking korean] translator: today we had a historic meeting and decided to leave the past behind, and we will sign a historic document.
the world will see a major change. i would like to express my gratitude to president trump to make this meetingappen. thank you. pres. trump: thank you very much. >> ok. anna: there we have it. trump calling it a very important document, but very little on the substance of what that document entails.
about auto warm warmbheir?o pres. trump: you will see everything in just a little while. the letter that we are signing is very comprehensive. i think both sides are going to be very impressed with the results. a lot of goodwill when into this, a lot of work -- went into this, a lot of work, a lot of preparation. i would like to thank secretary pompeo, and all have is counterparts -- all of his counterparts. >> [speaking korean]
pres. trump: thank you very much. it is fantastic. [applause] pres. trump: thank you very much, everybody. we will see you little bit later and we are very proud of what took place today. i think our relationship with north korea and the korean peninsula is going to be a much different situation than it has in the past. we both want to do something. we both are going to do something, and we have developed a very special bond. people are going to be very
impressed, people are going to be very happy, and we going to take care of a very big and dangerous problem for the world. i want to thank chairman kim. we spent a lot of very intensive time together. i would say that it worked out for both of us far better than anybody could. i think far better. i watched the various news reports. i would say far better than anybody predicted, and this is going to lead to more, and more, and more. it is a very great honor to be with you. thank you to all of your representatives, very much. korean]king
pres. trump: thank you very much, everybody. trump sayingnt that there will be a press conference shortly. members of the media firing questions at them, but they are keeping tightlipped. hesident trump saying that is signing a very important document with north korea's kim jong-un. kim jong-un said they are signing an historic document and have decided to leave the past behind them. very strong words coming from them. trump saying that he and kim developed a very special bond. they have shaken hands in number of times today, haven't they? clearly that relationship and development -- in development.
he said the relationship with north korea will be very different and they have developed this very special bond. linda comes to us from singapore. >> that's right. i want to bring in the chief north asia correspondent. what do you make of those words coming from trump as well as kim? both pretty much saying that it is an historic document that they have signed. >> absolutely. strong wordsy coming from a donald trump, and even very interesting words from kim jong-un. they want to leave the past behind. donald trump a little bit more -- had a few more words to say. he said they developed a special bond, and spent a lot of time together over the course of the last few hours. a lot of goodwill, donald trump says, went into the signing of
this agreement. he says the korean peninsula will be a much different situation than the past. kim jong-un says this was an historic meeting and the world will see a major change. that is quite a good sign. he expressed gratitude to donald trump to make this happen. he was asked, you could hear the reporters shouting some questions to donald trump about, did kim jong-un offer up any sort of timetable for denuclearization. he did not answer and said to wait for the press conference later this afternoon. he asked him -- was asked about the american college student detained in north korea, who was held, and subsequently died. he did not answer that question. i don't have the details yet of
what they signed, but both of these gentlemen are spinning it quite positively for both parties. mutually beneficial is the key take away there. i don't want to read too much into the symbolism, as the gentleman came out of the door to start signing, we got a giant thunderclap. the wind has picked up and it is about to rain here. i will tell you that. anna: we know that we are looking ahead to a press conference a little bit later on. interesting to see trump talking about he and kim having developed a very special bond. quite amazing language when you put that up against the acrimony that we saw at the g7 summit with traditional u.s. allies. >> that is right. donald trump wanted to have a he has builtso muchl.
political capital, saying that he is going to have a summit with kim jong-un, and it is going to be beneficial to the united states. we don't know what concessions he has given, if any, or concessions that kim jong-un has made with regards to his nuclear program. mike pompeo yesterday said they could offer up some unique suggestions as far as providing pyeongchang with security guarantees. that was obviously a main concern of the north koreans, that donald trump and the united states would not go back on its word about regime change. much like critics of donald trump have said, he has gone back on commitments from the g7. he has pulled the united states out of the paris climate accord, deal, whatclear
>> the world is waiting for one handshake. we must have seen about 10 by now. david, i want to bring you back in. trump has said he has developed a very special bond with kim. are you buying that? can you develop a very strong bond within a couple of hours? david: we all have some special bonds in our life, but very few happen in a couple of hours. they were predisposed to have this special bond because they both need an ome. by saying that they have a special bond, that creates diplomatic space for them to move forward, and provides the kind of assurances that kim must need to move forward. it is not surprisingly, but i think they were -- it does not
surprise me, but i think they were predisposed to have that special bond. the applause is a function of the fact that it is happening at all. that is a kind of reassurance that the relationship is becoming at least somewhat more normal, and more certain, as i go back again saying that uncertainty is destabilizing. by saying that you have a good relationship, you move some of that uncertainty. anna: maybe the applause came from those who do not know, but i just hopeful. trump saying that he will meet ,ith kim jong-un many times probably just tried to tell us that he thinks he has a strong lationship. maybe this could tell us that they are setting the path for continuing negotiations. it would be unfair to expect it to be done on day one. >> are going to be the rain --
beat the rain? anna was asking you, trump has said he will meet with kim several more times. is this a sign of more negotiations to come? david: yes. a lot more work needs to be done behind-the-scenes, as well. there has not been the type of work done to make sure there is a long-term agreement. there is more work to be done. anna: strong language used though, right? they talked about leaving the past behind, they talked about that the world will see a major change. are you encouraged by the words used? david: yes, i am encouraged.
i think it remains to be seen just how far this can go. i think the parties have to be committed to something along the described before for it to have a long-term beneficial affect. head of investment rategy and research at credit suisse international is still with us, nannette hechler-fayd'herbe. we don'tt is that they are signing. there could be some positivity in markets, do you think as a result from this? but we have to wait for the details. think definitely the general macroeconomic backdrop is good. there will be reassurance not only politically that there is positive news, and that there is not only reason for hope on this very important political front, but in fact things are running
really well in the economy. i believe certainly is also credit suisse's view that equities are the place to be. they are likely to benefit from it. probably within the equities space, in fact emergent market equities could stage a rebound. anna: emerging markets could stage a rebound, in contrast to what we have seen. christine lagarde of the imf talking about the darkest, biggest cloud for the global economy was a deterioration in confidence. she did not mention trump by name, but it was not hard to see the u.s. administration being referenced in what she was talking about. the markets is still learning a lot about what a trump presidency means, i guess. be atte: i think that must
distinction between all of the talks and rhetorical, and what is going on -- rhetorics, and what is going on in real facts. in real facts, trade is going up. this is all part of the cyclical upswing. altogether, for the time being, it seems as if the economy is still on a very good track. slowdown in the distant future, but for now it seems to us that we are having a ackdrop. bs anna: thank you very much, that was nannette hechler-fayd'herbe. david carden stays with us. we have been witnessing some historic events today. -- president and trump and kim jong-un of north korea signing a document.
ofistine lagarde warns [indiscernible] the g7 summit. anna: good morning, everybody. this is nannette is "bloomberg daybreak: europe ." the signing of a document of o not know the contents by kim jong-un and president trump. we are waiting details, coming at 2:30 p.m. local time. trump has said he will hold a press conference to give the details. he said the details will come.
important to note that with have said they have developed a very special bond. anna: a special bond. the -- president trump talked affecty about his meeting with kim. shaking hands and singapore for the first time. of handshaking since that moment. press conference for the details. with that in mind, let's check the markets. are keeping expectations in check my investors keeping a level head. things are looking positive than they did in u.s. futures in our or so ago. we are expecting a bump at the start of the european trading day. keep an eye on the u.k. specific story around the pound. risk radar. the show you where the asian session
has got to. we have gains coming through in the asian session. events -- unless the events in singapore run away with themselves. we see some yen weakness coming in, that is the bign of a risk on atmosphere in markets. a little bit of yen weakness and us,d inglis was telling something of a symbol of how conversations are going and singapore. the pound against the dollar, we are down .1 of 1%, down again on the pound. it is a key day for the brexit conversation. we wanted to talk last hour but we stopped with the advance in singapore. where looking ahead to a number of key votes in the house of commons. government- will the , will that be important going into the summit at brussels? the manufacturing data disappointed yesterday. let's get a update.
said heonald trump has has signed a very important document with kim jong-un. he added that is content would the revealed at a news conference later today. the comments come after the leaders held a historic one-to-one meeting and a working lunch on the island of sentosa. trump's top economic adviser suffered a mild heart attack. larry kudlow is in hospital and the white house says he is doing well. kudlow has been a long time confident and a tent -- accompanied him to quebec. the meeting led to him backing up the president's irritation with allies, notably, canada. the imf's managing director christine lagarde said threats to the global economy are aring -- are rising in the
clouds of a trade war. getting darker in the week of the g summit -- g7 summit. that is where president trump , justin trudeau of being dishonest and weak. hashe u.k., theresa may damped down one rebellion by members of her party and urged rebels to back down on another. she edged toward a deal in exit that could hold her divided party together. david davis gave his backing to a compromise amendment on arrangements with the eu it was not clear the government has staved off a possible challenges. legislation goes to parliament today and tomorrow. global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. you can find more stories on the bloomberg at top .
kong, dave has your market check. last 30pan closing up, minutes of trade over in south korea. it will be shut tomorrow. the hour of trade on chinese equity session. have a look at the topsy-turvy session. you look at these things and to make a long story short, we see the mood turn a little bit lower, a bit more risk-averse the last few minutes or so. perhaps they might have to do with the uncertainty surrounding what they did sign and we will get a better indication when the press conference starts three minutes or no. --e a look at the dollar one dollar won. closer to a three-week high. things those two together, you get that. that is pointing down, that is good. bit more inttle trouble there. if you want to get a better
kospiof sentiment, the index is below. the price of the option as it reaches 320, that level or 1% from the current level in two days' time, that is the price, the line that tracks the price to it. a little high this morning but traders do not think that will happen. we will be trading sideways for the next 48 hours or so. this could change over the next 30 minutes. depending on what comes of the press conference in singapore. that too. -- back to you. the recent hours, they concluded their historic summit. let's rejoin stinko -- stephen
engle. what can we expect in the next few hours in singapore? is what ietails, that want. what important document, what is in that document, and what did they agree upon? i am sure that monday and -- wereis celebrating they cordoba now he is nervous as well. arejapanese and russians asking the same thing. what have they promised each other in that document? two comments he made, we are ready to leave the past behind. the world will see a major change.
we are seeing major changes in the world. two days after donald trump is calling the prime minister of , their closest neighbor and ally, we can dishonest and hauling jim gone -- kim jong-un a worthy negotiator, a talented man, and someone he has developed a special bond with. clearly, the world has changed. watched that pivot from the g7 and we spent the weekend comparing images with the shy hot -- shanghai cooperation organization. we wait to see what the next few hours have in store. we're waiting for the details and we see these two gentlemen depart, probably to meet again at another point. trump was talking about he will meet with north korea's kim many times. here, maybe make a
trip to the minibar, and off to the airport where air china 747 is on its way from beijing to pick up, presumably, the same aircraft, take him to pyongyang. the summit, i am going to go out on a limb, is over. we will hear from donald trump and it is the details. the devil is in the details of what has been promised. i am assuming they gave some security guarantees. we do not know how much kim jong-un has talked about denuclearization. earlier on, when the cameras were rolling, we did hear someone from the u.s. side ask kim jong-un a question or something related to denuclearization. he did not answer and when donald trump was asked, did you make progress on denuclearization? he was asked that reportedly,
shouted by various reporters, and he did not answer. saying wait until the press conference. that is what we will do. patiently waiting for those details. a: you have been skeptic. he said you would be impressed. have you changed your mind? a skeptic.am not i am a journalist. i have lived in asia nearly 30 years, 28 years. i have heard promises made and promises broken. and i am old. i hear these things over and over and over again and i go, ok, let me see the proof, it has to be in the pudding. not necessarily the lobster bisque or whatever they had for lunch.
sorry. i am a little bit skeptical because there have been a lot of promises made by the north koreans and they have broken them, and this is a different tack me from the united states as well. i will give it the benefit of the doubt, but imain skeptical. what did ronald reagan say, he said "trust but verify." thank you very much. on sentosa island. ambassador to asean is still here. you look through -- at this through and economists -- an economist's eyes. this has the ability to shake your world or are you watching because of the east dividend it
could deliver and the importance of geopolitical events? guest: it is a momentous occasion, it is very important. we have not seen much of an impact on markets. impact will, we will expect that to be relatively muted, particularly for the global economy. is alearization, if there peace agreement between the north and the south, that is extremely positive, very progressive. i do nothing we will see much of an impact on the markets. we will not see much impact feeding through to regional theomies, and less to global economy. anna: maybe your colleagues have to get more knowledge of the korean economy. heard from ben bernanke
and from the imf about expectations of growth being ok in the next couple of years but moment as ben bernanke talked about or looking a little less robust was what the imf was pointing toward. are you looking for that kind of trajectory for the global economy? guest: we are in a good position, we have pretty decent growth across europe. the u.s. economy is doing very well. strong growth in the u.s. looks set to continue for the rest of this year. for next year, some of the tightening we have seen happening already across the major economies is likely, in our view, to moderate growth. we are not looking for a downturn in 2019. we cannot ignore the fact that the u.s. economy is looking very mature. the expansion now carries on for
another year. -- longest expansion in 100 years. that does not necessarily mean it has to come to an end but some of the support for the economy is starting to fade. may be looking after 2020, it will be -- growth momentum will not be so strong. haslinda: we watching thea ecb, the fed, the doj. re that should be the one to -- that should be the one to watch. guest: markets have factored in there will be a rate hike tomorrow from the u.s. it would be interesting to see what happens to that statement. will they signal a more neutral policy, will they change the economic forecast? we expect they would lower the tweakoyment forecast,
higher the inflation forecast but what will the fed say about future red -- rate hikes? we are expecting a hike in september and december. the dot plot is going to be particularly closely watched. the ecb, we not quite sure what to expect. play us a they would cautious hand. some of the comments we had from the governing council suggested the ecb is ready to make a more public statement about what happened at the end of qe in september. will they continue to expand bond purchases in the fourth quarter? qa -- qethere will be carrying on but at a lower pace. we may get a clear signal about that on thursday. at this thursday's meeting.
are getting reports his way jong-un is on to the saint reg. the summit with trump is over. i want to bring in the former abbasid are two -- ambassador to asean. . lot of progress has been made the issue is reliability and the that hiso ensure systems are not perfect. guest: it is hard to know what capacities he does have. it is the risks are extraordinaire really great. the parents itself is concerning and we are not entirely sure where he is but there is some proof that he has capability and in the near term, will have increasing capability unless something is done. so much, thank you form
on the markets. headlines, inse line with his pictures that we have seen for the last hour and a half, let's have a look at the markets. the european stocks futures are higher, point three of 1%. flat is positive but not running away with themselves. , 2.960 year yields percright now. let's take a view on the politics. the u.s. politics of what we have seen taking place. bloomberg's senior executive editor joins us. the chief economist for standard and chartered inc.. your thoughts on what we have have the theater of the seen taking place between trump and kim. it looks as if we are getting with the details of these announcements. the u.s. and north korea to join efforts for a stable peace raging.
we are looking for the details. guest: the devil is in the detail. donald trump love to the stage. no one is talking about which is bob mueller and for his domestic political audience, this is nirvana for him. the devil is in the details, and that will take months, if not years to work out. anna: we had an interesting conversation with david cardon. he was making the point that the u.s., the level of u.s. involvement in the process that follows could take a number of erent paths. your thoughts on what you have learned watching the trump white house, how committed he wants to be for the process from here. very: it is a transactional president we have. if the japanese, south koreans can give him something for innging him, bringing them the process, i am sure donald trump will be more than glad to have them involved. i do think the details of how
this agreement is executed is shownmething he has interest in. he is interested in the ability to say he has to win, and he has. he has accomplished something that was unthinkable year ago. haslinda: when you talk about the details, what are you hoping to see? guest: how are the broad principles of denuclearization going to be implemented, or how is it going to be verified? are they going to destroy weapons they currently have? those are very important details. i doubt if they are in this document. as we work our way through it, there may be a systematic process that will get underway. that is the kind of thing you need to see. we are getting further lines coming from this document. korea joiningh
ranks. at is what north korea is pledged toward. documentls of this coming, and we wait for the price conference -- press conference. is focused on other things. boe, thet vote, the doj, what has the power to upset markets? a lot are priced in around the fed. guest: markets are expecting central raise rates. there is a great expectation they will signal four three hikes. less clarity about what will come out of thursday's meeting. we're hoping there will be some details about what happens after september when the current qe purchase program is going to be ending. we do not know whether we will
get confirmation that fast. for the brexit vote, today and tomorrow, could be some surprises. the government is vulnerable to losing on a couple of the dawes amendments. that would signal the u.k. was andng toward a customs unit several opportunities for surprises this week. our conversations have been slightly overtaken by global events. u.s.-north korea to cooperate for development of relations. north korea pledged to work toward complete denuclearization. thank you to you as well. bloomberg's senior executive editor, giving us expert insight intohe white house and what trump is making of these events. thank you very much. we are on standby.
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