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tv   Bloomberg Markets European Open  Bloomberg  February 15, 2019 2:30am-4:00am EST

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anna: good morning, welcome to "bloomberg markets: european open." we are live from our european headquarters here in london. alongside mattds miller in munich for the securities conference. matt: good morning, the markets say the devil is in the details. stocks falling around the world, weak economic data shows no sign of an end. talkshina trade wrapping up with little progress. cash trade is less than 30 minutes away.
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anna: going nowhere, the u.s. and china they'll to narrow the gap on key trade issues. futures.ll with u.s. another defeat for may. the u.k. parliament voting against the prime minister's brexit plan. she prepares to compromise with brussels. completing the turnaround, rbs announces the first special dividend in a decade after strong profits in the fourth quarter. matt: good morning. a half hour away from the start of european trading. i am in munich for the security conference which could be the scene of another showdown between the u.s. and china, and the treatment of huawei will be high on the agenda as the country's five for influence and technological dominance.
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we see futures, you have futures there, and i assume they are pointing down. anna: absolutely. we will be across that technology interplay as it manifests itself at the conference. meanwhile, futures point, down by 0.2% to expected to pick up where the asian session ended. a negative session there, chinese markets weighed down by trade. and the lack of progress. ppi hasese data, the itestors worried about what does to chinese profitability. in terms of fx markets, the pound is clinging to losses yesterday. holding around the 128 level. the big picture is around trade and the u.s. administration and the emergency measures conversation.
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all of this is weighing on the asian session, and on the session here in europe. mark cudmore joins us. he is in singapore. today we are asking the question of the day whether an extension of the china-u.s. trade conversation will be positive or negative for global equities. in the short-term it seems negative. i suppose it depends on details that might influence as the day unfolds. that is absolutely right, the idea that this is a negative development has not helped by reports that both sides are far apart. overall, if we get to the weekend, if there is a understanding, i think equities will be fine with it. my answer to the question of the day, this is an ok development.
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as long as trade talks do not escalate, people will realize the world is not that bad a place, and equities will do ok. the devil candy in the details, and the fact that the sides are far apart means there is a chance we do not just a delay, but a sign that things are deteriorating. matt: barring that, i wonder how important the build of the president to set to sign to avert a government shutdown, and the state of emergency he is expected to declare to start building his wall. that if at alls to markets? mark: it is a good question, at the moment it is not that important because people are confused about how to trade it. it is great news that a shutdown will be averted. when there is a government shutdown, it is negative for the economy. it drives down growth.
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the emergency bill to fund the wall, that is worrying, the u.s. has trade deficits and the spending is marginal. will increase tension in u.s. politics, that is a hard thing to trade in the short term. the overall conclusion, it is not much of a market story in the immediate basis, but a negative on a medium-term basis. let me ask you about the data out of the united states. ,n the midst of the shutdown and the aftermath, we got tired data on the u.s. consumer retail sales. , -- not so in the bond markets. different reactions from different asset classes. i think we have seen that the versions for the last month or so. equities rallied strongly since the start of the year. yields have not followed that
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higher. that is a good sign in that we are in a goldilocks scenario. we are in this world where there is no sign of runaway inflation, and growth is not collapsing. investors put money back to work. they took too much money out in december. people are putting that money to work and chasing yields. they are putting it back into the stock market. one of the biggest reactions we saw in retail sales was disbelief in the market. i have not had time to go through the data, but i trust the experts, they think it is too distorted. elements.e are other hand we had 2.6% whichelds down
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seems to suggest investors want the safety of u.s. government debt. au can buy more than ¥110 for dollar amount why do not we see the japanese currency strengthening on these awful retail sales numbers? is it that there is no inflation in the u.s.? i think it makes sense to weaken. we are not in a bad scenario. risk assets have been doing well. it makes sense for the yen to weaken. it makes sense for yields not to run away to the top side. inflation will not run away soon. the key points of how the trade and react to inflation, inflation is the most important thing.
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people are entrenched in want liquidity, but that is not the big driver here t. a set ofunlikely to be hikes soon because there is no runaway inflation. it makes sense that treasuries are doing ok even if the yen continues to weaken. back inldilocks perhaps the building. thank you mark cudmore, bloomberg strategist. you can join the debate. get involved with our question of the day. we would love to hear from you. word updatefirst from debra mao in hong kong. parliament has thrown out theresa may's plans to renegotiate brexit. lawmakers in her own party
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refused to vote for the motion abstaining in protest. they demand changes to her divorce deal. they try to take no deal off the table if they cannot secure an agreement. president trump the legislation needed to avoid another government shutdown. he is set to sign the bill even though he is not happy with it. trump is also planning to use executive authority to spend $8 billion on the border wall, which will provoke a lengthy legal battle over presidential powers. iran has plans to build a new headquarters in new york -- amazon has plans to build the new headquarters in new york. they fear opposition from local residents and politicians. movesblankfein says against amazon are anti-progress and anti-democratic. india has suffered its worst
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terrorist attack since modi came to power. the death toll climbed to 41 after a military convoy came under attack. a pakistan terror group has claimed responsibility. prime minister modi is under pressure to approve the military response against his neighbor. global news, 24 hours a day on air and at tic-toc on twitter, powered by 2700 journalists and analysts in more than 120 countries. this is bloomberg. thank you very much, debra mao with the first word news. up next, a showdown between the largest economies with whil -- radio is bloomberg live on your mobile device or dab digital radio in the london area.
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this is bloomberg. ♪
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matt: welcome back to "bloomberg markets: european open." we are 50 minutes from the start of trading across the continent and the u.k. i am here in munich advocacy or conference.rity
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the u.s. and china could be set for another showdown at the security conference. huaweiton's treatment of will be in focus. the issue of burden sharing in the funding of nato will be a big discussion, as well as the discussion of the europeans protecting himself in some way, and their power position on the international stage. -- thank you for your time this morning. i have jazz on my mind. matt: let me ask what your take is on the huawei showdown. what do you expect between the u.s. delegation, and the big one in munich since the congress
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began in 1969, and the germans who need some of this technology. >> we saw members of congress and the vice president coming, there will be a full-court press on this question, building networks and europe. is the issue, the americans think this is a security threat. toy will be pressing hard keep the germans from going in that direction. bringingse are here their high-powered delegation, and they will make the argument that this is about free trade, and why shouldn't chinese companies compete with the americans? if they are better or cheaper, their technologies should win out. that should be a big fight here. germans on another issue have built up a reliance on natural gas that they cannot cut off of. as a result, it seems from
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president trump's perspective that they are willing to ignore any atrocity by the russian leaders in order to get their gas. the you expect that to be an issue? james: the pipeline is still a major bone of contention. it is hard to say that the germans would ignore any atrocities. they are out in front on sanctions against putin on the ukraine issue. they have been tough on putin. they will say, they will build the pipeline and liquid natural gas facilities to buy american fracking gas. they will press diversity and suggest that is the way forward for them, and keeps them able to keep up a hard line against putin. matt: they will build two lmg
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gas. here to buy u.s. what about the contribution to nato question mark that has been a topic here for many years, but it is becoming more stark, the fact that europe needs its own military force. james: the europeans have come to realize they cannot take american support for granted. if you think back to the obama administration, they were pivoting to asia, pulling some troops out of europe and traditional american support back. asking the europeans to do more. trump has accelerated that. the europeans have gotten that message. it is a refrain we keep saying, 2% is the way to move forward. i think the europeans are trying to go forward. we saw a major announcement by the french and germans about the
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next-generation fighter aircraft, a multibillion-dollar project. expect members of congress to ask the europeans to do more. that is the message they will be bringing. matt: will we see a large u.s. presence here? it has been announced, but they were saying a lot of people i'm a including nancy pelosi's office, is dependent on whether or not there is a shutdown. will there be important congressional and military leaders here? 6:00, ihis morning at got a text message that they were on their way and will be late. they are passing the budget resolution last night. it will be a big group. we will see what they bring for a message. james davis, looking forward to your next album. dean of the school of economic and political science at the
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university of st. gallen. for the bloomberg business flash, debra mao in hong kong. berkshire hathaway has shaken up its portfolio. in apple and stake exited its stake in oracle. it spent 2018 buying banks and insurers, to make it major fiveholder in four of the lenders. estimates,ine with the german insurer said it is starting a 1.5 billion euro buyback program. ofit is a combination stronger predictive performance, and we combine this with growth and capital management. bra: that is your bloomberg business flash. anna: debra mao for us there in
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hong kong. minutes away from the start of equities trading, and then we will look at the stocks to watch at the opening. european equities point lower at the start of trade. delayed tradefor between the u.s. and china, a lack of progress weighing on market sentiment this morning. this is bloomberg. ♪
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anna: welcome back to "bloomberg markets: european open." seven minutes until the start of cash equity trading's. interesting stock stories to keep an eye on. we are looking at autos, and dani burger is focused on rbs. 11% on the premarket as the company is agreeing to a takeover bid. offer whichde an was rejected from the company, and it is a 4.9 billion euro takeover offer. elizabeth, i am here in
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munich, i just shook hands with -what is the story with the automakers today? >> another disappointing day for european automakers. we have numbers this morning for the fifth month in a row a decline. it looks like what started last year was handwringing about unit tests causing production bottlenecks and a broader slowdown. we have a technical recession in italy, germany narrowly avoided one last year. all of this with looming brexit. they will only meet a forecast if they do not get a hard brexit. anna: brexit looms. dani, on rbs, the bank giving a gift to markets and investors.
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speciale gift in a dividend, the first time they have done this in a decade. investors love the dividend play in europe so that should help shares a lot, and confidence they can weather the brexit storm. drop us beating expectations, 570 billion pounds. overall a positive report from rbs. you for joining us. if you want to know the latest stock story that we are keeping an eye on, though on your bloomberg terminal or the mobile app. futures point downwards. nvidia.numbers out of maybe trade tensions and concerns ways on this morning. keep an eye on premier foods. they had been trying to sell their ambrosia brand.
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a buybacke also -- also in the offering. this is bloomberg. ♪
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♪ >> a minute to go until the start of the last cash equity trading day of the week. welcome to "bloomberg markets: european open." let's take a look at how some of these markets are positioned as we have 51 seconds to go until the start of friday's equity session. the euro weaker this morning. we had some dire data out of the united states yesterday. set a fairly negative tone for much of the u.s. session, although we saw a divergence in performance across much of the asset class. some weakness in oil prices. brent not doing badly compared to the last three months or so. this is the all-important equity picture coming in from china. china weighted down about concern around delays in trade
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talks and concerns about the pricing environment in china for chinese corporates. the ppi number looking at little week. futures suggest we will be weaker at the start of the trading day in europe. overwhelmingly it is concern around the trade and a lack of progress around trade. no immediate statement coming from either party in china with regards to those trade conversations as well. that leaves markets a little bit confused, or concerned, or awaiting guidance. in the midst of all of that as we wait for some guidance on what happens next in trade, when will these parties meet again, when will we see a decision taken on whether the deadline will be extended across -- past march the first, we trade along that. the futures were suggesting we were going to see some divergence at the start of the trading day but we do not have an early finger on the dax.
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if we only lost this much at the start of the trading day, that would be quite a good deal of progress compared to the picture in the futures market about an hour ago. the cac up by a touch. things look fairly mixed, flat to mixed, i should say, across these equity markets right now. energy markets look. pretty weak, financials. industrials weaker, staples looking pretty positive though. health care looking at little mixed, as do utilities. let's get to some of the movers this morning. some interesting stories to keep across. vivendi the biggest gainer, up by 5.4%. up by 4.8%.ia we brought you a story that the state lender plans to increase its stake there. nestle moving higher. ubisoft entertainment the
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biggest gainer across the stoxx 600. that is the movement to the upside. if we have a look at the downside we have a ms the biggest loser, down by 2.7%. as we were talking about concerns around maybe what's going on with trade weighing on tech rather than being lifted by those nvidia numbers. i see some of the automakers a little bit weaker this morning. matt? matt: actually really fascinating to see european markets open up pretty flat. not so bad this morning. that is as little progress was made in u.s.-china trade talks that really weighed on stocks in asia overnight. global growth concerns resurfaced. of course, the retail number out of the u.s. was absolutely awful. joining us now is john roe, head of a multi-asset funds at legal and general investment. what is your take on the global
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economy as we get more signs of a slowdown? john: i think investors are seeing that there is a lot built-in for a slowdown anyway. it really comes down to whether or not china rebalance. the u.s. picture looks better than what people thought a month or two ago. it really comes down to how does the -- does china do? and can europe avoid a recession? which looks likely. you should get enough stabilization to push a u.s. recession out to at least 2020. you would leave a pretty positive backdrop for markets. anna: let me ask you what's going on in the u.s. domestically. ne are all keeping an eye o the state of the data. we have this retail data plunging the most in nine years. many people saying that there are glitches here. the glitch that stole christmas.
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does this tell us anything useful about the state of the u.s. economy? john: i think the problems of the shutdown make it so difficult. it's like you -- the problems you have every year, like with china and the chinese new year. just like we have seen some erroneously large numbers as well, like the jobs data coming two months in a row. people are not putting too much behind those data points in the u.s.. toda -- year to date we are looking at gains of 10% on u.s. equity indexes. not so much here in europe. i think about 5% or 6% depending on which index you look at. what do you think about stocks? how we already priced in all the success we are bound to have an 2019? -- in 2019?
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john: we don't think so. we are about two thirds of the way we started at the start of october -- we were at the start of october. against that backdrop we have also got a couple of technical factors start to kick in. if this rally holds, we will start to see the cta strategy by back into equities -- buy back into equities. you will ct test see these cta trend -- you will see these cta trend following strategies start to -- we will sell on strength. what really worries us about that is that it is a consensus view. a lot of people talking about that there will be a global slowdown. that's always concerning. the one scenario that nobody is talking about is that melt up
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scenario. that kind of is always a worry. end with a bang not a whimper. the underpriced scenario can optionally -- actually be the melt up. ask, well, i just want to where are you buying? where are you selling on strength? are you focused on u.s. equities? i'm concerned about the u.s. exchange rate -- are you concerned about the u.s. exchange rate? john: we bought a lot of credit last year and in january. adding to risk assets at that point is not look further -- does not look attractive. we think sentiment is so positive that it is a bit primed for weakness. we do worry that if we got a
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stronger dollar that could undermine the risk rally. , if u.s.ation inflation comes through, that will force the fed back into action, which will compete -- completely undermine we have seen a 2019. anna: john roe stays with us. we will bring you the stocks on the move so far this morning, including rbs, after the break announces a special dividend for the first time in about a decade. q4 profits coming in above expectation. we will talk more about that. this is bloomberg. ♪
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♪ welcome back to "bloomberg markets: european open." 10 minutes until your trading day -- into your trading day this morning. a fairly flat session across europe. despite the gloom predicted by the futures markets, we are fairly flat on european equities. u.s. futures still point quite decidedly weaker. let's get the individual stock movers this morning. >> here is one of our big movers to the upside today, telecom islia italy's state lender said to be interested in doubling its stake in the telecom company. part of the requirements for the italias that telecom needs to spin off its landline business. analysts say it's worth 15
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billion euros, so certainly positive for the shares. rbs losing some of the steam it sought earlier this morning. it opened by 1%, now up only 0.2% after they announced -- 0.3% after they announced a special dividend, the first in a decade. saab analysts see a mixed picture -- analysts see a mixed picture from the saab earnings. 's ceo saying he does not plan for anymore job cut programs in 2019. matt: thanks very much. you look at some of your individual stock movers. parliament has rejected theresa may's brexit approach once again. lawmakers voted against the supporting the prime minister's plan to negotiate with the eu. the u.k. officials are now preparing to compromise on their
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demands for a rewrite of the exit deal -- brexit deal. joining us now is bloomberg's london bureau chief. parliament essentially voted against theresa may having the mandate that parliament gave theresa may just a couple of weeks ago. what are they doing to their p.m.? dayhis is kind of groundhog again, isn't it? parliament is continually contradicting itself in terms of what it wants. last nights amendment, which was deleted -- defeated, was nonbinding. it shows that prime minister theresa may has utterly failed to bridge the gap between and the european
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research group that would have supported her negotiating tactics with brussels and the softer eu exit part of her party. that is leaving her looking more isolated than she was before now. anna: tell us a little bit about what this means for her talks with the eu. it's almost as if what is happening behind you in westminster is peculiarly disconnected from the conversation happening across the channel, isn't it? >> absolutely. that's an ongoing trend, where what's happening in parliament differs completely with what's happening in brussels when the talks with the european union are happening. meeting did not change the dynamic that much. theresa may's next challenge is to get something out of brussels. she is now adopting more plans to deal with brussels but she still has to come back to
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parliament, which will be a problem. they are now saying they do not need that. even if she finds agreement with the european union, we go back to westminster, and again she has to face the challenge of trying to get that passed lawmakers in the houses of lawmakers in past the houses of parliament. matt: what is the next hurdle theresa may faces? will it be in parliament? will we get another comparables bowlsent -- cooper amendment? >> if she has not achieved what she set out to achieved, which is changes to the backstop, her deal faces a further defeat. parliament is going to take control of the negotiations and she will be left out. then you have the question of, what theresa may will do in her position when she has promised
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brexit and it will have failed to the deliver it at that stage. she has two weeks to find a compromise. if you find a compromise with the union, difficult to see how that would win support within her own party and the wider parliament. will it be a cooper spelman amendment? february 27 looms on the horizon, doesn't it? bloomberg's london bureau chief lived for us in westminster. still with us is john roe. so many possibilities, so many roads still remain open. this process of shutting down the various possible outcomes. things seem to be -- outcomes does not seem to be moving very quickly. do you have anything that is remotely like a base case on brexit? plus i base case is an eea
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style deal, so similar to norway. mp's,ou work out the that's the only one that might be able to get enough mps to vote for it on a purely what do they believe in approach. neither leader of the party want that. theresa may and also jeremy corbyn would both really rather have something more similar to the theresa may deal than an eea deal. and theresa may's case, it plays more to the hard-line of her party. in jeremy corbyn's case, he wants the ability to use state aid. he also believes passionately in restricting the movement of people. to do that he needs to be not in the eea. it's kind of that fine line. can she get jeremy corbyn to allow a free vote or support a revised proposal? because he realizes the
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alternative is a norway style deal or even a referendum. why it'st's cap's into important whether we get parliament retaking control of this brexit. matt? matt: the whole thing is such a guessing game, right? it's fun but you cannot really invest on it. are there u.k. assets that you can invest in that are not touched by this uncertainty surrounding brexit? john: i think you can invest in the brexit risk. i think sterling has significant more upside to rally than as downside to fall, because over 400 mp's have said they will not support a hard brexit so it's unlikely we get the outcome. there is a decent chance we get a second referendum or a norway style deal, either of which will lead to a significant rally. they are being depressed by this risk of a prolonged brexit outcome. probably sterling is the cleaner
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way to play it. anna: meanwhile, expectations for when the bank of england hikes being pushed out because u.k. inflation dipping just a little bit. when you expect the bank of england to move? i guess -- suppose it comes down to where we started, with the base case for brexit? john: they do want to get another hike in, but clearly the present uncertainty makes that difficult. there is this a bleak picture in china and europe where it's just drifting lower. that creates no inflation pressure, no need to hike, but could bring the risk of deflation back to the table. oft: john roe, legal -- head multi-asset funds in legal and general investment. could spain's prime minister call an early election as early yesterday? we will talk about -- as early
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as today? we will talk about that and it growth, or the lack thereof, next. this is bloomberg. ♪
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♪ anna: welcome back. this is "bloomberg markets: european open." we are 21 minutes into the trading day. a fairly flat session in europe. how long will that last? u.s. futures point downwards.
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the spanish prime minister could call a snap election as early as today after parliament rejected the government's budget. erdogan john roe -- john roe still with us here on set in london. ,o in terms of the risks political risks in the eurozone, how do you compare spain and italy against each other? for a long time italy was the focus of our political risk conversations. we saw that with spreads on italy wedding versus spain -- widening versus spain, but now spain coming up the rails. john: spain has been the poster child and not getting involved in the populist side of european politics. no far right party there until recently but no of course we have seen the government collapsed and a likely new election, probably in late may. against that backdrop, a 22% increase in the minimum wage from very low levels is very high and a clear nod to populist
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politics. against that backdrop we need to see that there are two bad outcomes that could come out of that spanish election. one could be a shift to the left, and other be a far right coalition if this far right party were to be the king maker in this next election. matt: that's exactly what it looks like is going to happen. how much does it matter though, against the backdrop of the strong growth you are seeing in the spanish economy? john: that is what continues to differentiate it from italy. it has much lower starting debt, stronger growth, and unemployment coming down at a faster pace. that is very much the strength against it. we see a lot of this as noise. we tended to buy these political flareups when they happen. we already own catalonian bonds.
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when they have the independence referendum. what this really reminds us about is discontinued fragmented nature of europe -- this continued fragmented nature of europe. you get is continued blowups and everyone is a chance for something to go more seriously wrong with italy the most likely to pass. anna: we saw that germany narrowly escaped falling into a recession. it's still a week picture, isn't it or a deteriorating picture? how concerned are you about the economy? john: you have to be. it's growing at capacity so it does not have to grow very fast. if it grows too fast it puts pressure on the european project. actually from a european project perspective, it's almost good
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news, because it does take away some of the risk of the overheating. it reminds us of the links into china and asia. that link being more of a concern, we have seen that slowdown there, and that being an issue, particularly around the threats to autos that will come out on sunday with the report in the u.s. as well. it's not a good picture for germany but it does at least [audio drop]
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john: -- from that perspective, the longer he is preoccupied with china on the longer he does not want to open a battle on the other front, the better for the auto sector. i think what you would like to get is a deal with china, an extension of 60 days, then he has got 90 days to decide what action to take against european and japanese automakers. anna: thank you very much. general, legal and investment management had of multi-asset funds joining us in london. let's have a look at which of the sectors are moving around in this session. the session not moving very fast but the auto parts sector definitely a laggard, down by 1.2%. the biggest laggard by far, financial services.
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to the upside, we have media trading 0.5% higher. scott 24 is the biggest gaining stopped at scout 24 is the biggest gaining stock -- scout 24 is the biggest gaining stock across the stoxx 600 this morning. this is bloomberg. ♪
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>> 30 minutes into the trading day, let's get your headlines. u.s. and china failed to narrow the gap, stocks in europe failed to find a catalyst. u.k. parliament votes against maze brexit plan, she now prepares a compromise. completing the turnaround, rbs announces the first special dividend in a decade after strong profit in the fourth. but the stock drops. miller in'm matt
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munich at this purity -- security conference at our european headquarters. i spent enough time in the cold outside westminster, but yes, i'm very appreciative. let's look at the markets, evenly divided. u.s. futures still look negative, and yet we plow a flat line this morning on european equities. half the sox going up, half going down. in germany, up by 12%. they said their takeover approach is no secret as to why that's moving higher. 7.2%, it looks like the state body is considering doubling investing. also that airbus is higher, getting another day of
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gains for the airplane maker after it scrapped its a 380 project. let's look at the downside and pick up on a few of the threats to the downside. here, down by 8.1%, the biggest loser. another internet business in germany goes down, down 4%. some of the carmakers also under pressure, konstantin tell, , bmw volkswagen, adding those together, it is by far the biggest losing sector. we have got eu registration numbers looking weak. let's get a first word news update. the u.k. parliament has thrown out theresa may's plan to renegotiate brexit and have given a mandate to change the divorce deal.
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bloomberg has been told they do not need to reopen the divorce agreement and can accept other ways to address the concerns spirit -- concerns. few signs of progress in u.s. trade talks. time is running out to reach an agreement that would avert an increase in u.s. tariffs by march 1. president trump says he's open to blank the deadline, it may a meeting between trump and xi jinping to form a deal. trump is set to sign the bill, even though he is not happy with their bloomberg has learned trump is also planning to lose -- use executive authority to spend $8 billion on the border wall. risks provoking a lengthy legal battle. is trump administration considering its next step to choke off the power of nicolas maduro, and may block for entities from dealing with the
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venezuelan oil company. also bracing for a bankruptcy announcement by a venezuelan controlled oil refinery. amazon is canceling's new york headquarters, and comes after fierce opposition from some local residents and politicians. the former goldman sachs ceo says the move against amazon was both anti-progress and antidemocratic. florida volkswagen is closing in on an agreement to join forces on self driving cars. one is a possible framework to invest in a high. the automakers discussed of valuing the company at about $4 billion. global news, 24 hours a day on air and on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg.
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matt: thanks, debra mao in hong kong. china's increasing need for energy could be satisfied sooner than expected, that's according to a report which showed demand growth slowing to 16 of the level of the past two decades. employers toce look elsewhere? spencer, me first ask where they would look elsewhere for energy. >> china's energy demands are slowing, but it is still a big market. 1% growth of a big market is still a significant amount of energy. but we thought it suggested even bigger is going to be india,
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where economic growth continues to reign strong. india becoming the world's largest growth market for energy. anna: good morning to you. so that is the picture in terms of where the demand comes from. how much of you consider the global trade dispute and how much that weighs on demand? or do you just look through that ? >> we had a special scenario this year where we think about the trade impacts. less open, it will affect the global economic growth. over time, it builds up, leading to weaker overall energy demand. another point that is important is that, in this world of trade disputes, importing lots of energy, you start to worry about the security of that energy.
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they start to produce their own domestically produced energy, and they tax somewhat like china, they move away from oil and gas and towards domestically reduced renewable energy and coal. anna: it speeds up the adoption of alternative energy sources. it speeds up the production of domestically produced energy. if you are china, india, you've got an awful lot of coal as well. matt: i am interested in the mix, spencer. here in germany, that is a changing picture, but it is changing slowly and is ethical to find alternatives to in china, for example, what is the breakdown of their energy supply? how much they get from coal, how much did they get from nuclear? today, about 60% of china's energy comes from coal. it is still coal dependent. or try to move away as rapidly as they can.
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the scenarios we looked at to make its down to about 45% of to do that, by 2040 they have to grow every other fuel rapidly. but also, huge growth in nuclear energy, and by 2040, nuclear energy is as much of a whole is the block put together. also strong growth in natural gas. china, big effort to move away from coal, but to do that, massive growth. anna: interesting, of course you have to make assumptions when you do these forecast. questions, butes tell me about paris goals and whether we get close to the goals set by the paris climate accord, based on your analysis. of the rough trajectory we are on, we are not
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on a trajectory towards meeting those goals. to get on those goals, we need carbon emissions vary substantially over the next 40 ,ears that subjective we're on we continue to educate. one of the key messages is we need to do far better in terms of climate. anna: even if many of us in the west switch to electric vehicles and the like, that's not enough. >> the thing of of electric vehicles is there very important terms of local air quality, you could put literally a billion vehicles on the world -- road are powered by renewable energy and it would not move the dial in terms of carbon emissions. one of the key parts where you have got to make progress is the power sector the carbonized the power sector. we need government to really focus their efforts. missingen you look at
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the crime -- climate change goals, do have a correlation between degrees celsius and gdp percentage point growth? how does that affect the economy? >> we don't to get into that about how itood may feedback into gdp growth. i don't think we really have the expertise to get into that issue. anna: thank you very much, a fascinating report. storiest to our stock we're watching this morning. some real individual movers for you. not only individual movers, but the extremes of the european market the biggest gainer, the german online classified business, excepting a sweetened deal. details of that 4.4 billion euros, also at 46 euros a share.
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,e are now trading above that so certainly some enthusiasm above that story. this is after zalando was cited as the top sure idea, saying that the cash conversion is one of the worst in the industry. the third-largest shareholder and usg has exited the position. sold was to 35 pence a share. -- 2.35 pence a share. should catch up, it will be quite low for a standard like. -- like aberdeen. matt: thanks. they have provided over the worst performing stock
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index in the world, but will he be reelected as weekend? -- this weekend? this is bloomberg. ♪
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anna: welcome back to the european open. we are 22 minutes into the trading day. session across markets
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, future still point down, but paring the losses a little bit. enabling us to preserve the flatline in europe. matt: interesting to see. so little size in such a lack of direction. africa's largest economy and oil producer is headed to the polls this weekend, the race between the president and his main challenger comes to a head on saturday with that vote. for more on the ramifications of the general election for the oil-rich nation, we're joined from lactose aired -- lagos. how important is this into the nigerian economy? how important is this vote to investors? >> thank you. election is very important because nigeria is the biggest economy in africa.
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the election is between the two andenders, the president his challenger. then saying the president will win, while others are saying the challenger will win. anna: good morning to you. tell us about the atmosphere. i know the parties have signed the forms to suggest they want a calm election with no violence, but how have things developed? >> so far, things have been called. except for stampedes recorded in various parts of the country are in campaign rallies. arlier in the week, people at election rally for party --
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buhari talked about winning the election without contesting. it has been gaining, of course, it is the world's worst performer. what are the gains down to? it has gained a $.60 since is low in january. now investors see an opportunity. has also said the stock market is going to keep up the gains if the president wins the election. tokaythank you very much run up toake with the the election set to take place weekend.this we got inflation data earlier on. let's see what is happening in our stock of the hour.
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24, but agreed to an improved bid from a number of parties. let's look at where we are trading, share prices down 24, up by 12.2%. been a very volatile stock, we often see it at the top of the bottom of the stoxx 600, and now we see it taken out in this process. we have been looking at the details and we are in frankfurt. it just helps show some of the metrics or the recent moves around this company. give us the latest on what has been agreed to hear. >> the consortium made an offer last month for 30.5 euros less share and was rejected, saying is too low. they have raise the offer, making the total offer 4.9
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billion euros. as a here from the company, they're find that offer. if that is the end, we will see. what is really at stake here? what are we talking about in terms of the size and scope of the market and its clients? is the leading company for appetizing, in terms of housing and cars in germany. his kind of a very well-placed business model. analyst out there sank even the 46 euro bid is rather at the low end for the company in terms of valuation. there ision now is, if another bidder willing to step in, the analyst mentioned in my not be a private equity firm, but rather an industry here -- peer, it might be on the agenda
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that they look at this. anna: and it is trading above the offer price. thank you. forget, bloomberg customers can interact with the charts we use here. gtd go is the function to use, you get to see all of the charts we use and catch up on the functions we are putting into the bloomberg tv program. g tv is the function to use. this is bloomberg. ♪
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anna: welcome back to the european open about 53 minutes in to the trading day. increasingly positive as we go through the session, despite the headwinds from the asian section where things were way down by delays to trade and a lack of progress. we were raided down by that any u.s. features, which have been negative, but regardless, we are plenty flat. let's talk m&a, something lifting stocks in the region. dsp says it has raised its bid to 180 swiss francs per share,
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they did that on february 6, but is the first we're hearing of it. this comes hot on the heel of other news from panel been. they have been evaluating interests as they evaluate the interests. inthey have been involved conversations while weighing up the latest from dse. --y put forward this tina panalpina share price. -- sessiona ship chart, you can see the price is moving higher as a result of this. stuff, we willng keep everyone updated as to what goes on in those days. let's take a look at what's hot or what is not.
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hedge funds had until last night to report the third quarter investment via 13f filings. bloomberg's dani burger has been digging into the data. >> but start with what the filings told us about today -- pay. here, the top great managers collectively made $3.7 billion. group, jimid of the simons, his fortune increased by $1.6 billion as for the holdings themselves, we have some big names. buffett completely exiting his oracle stake, also, apple tiger global slashing amazon state by a third. spotify another big loser in the report. managers leaving at a breakneck pace, including steve cohen. we arerall themes working at some of the fourth
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quarter is really about protections in performance and seeking safety. fundsere short-term debt and no here are the inflows for both. in the fourth quarter, you can see that 13 billion gets added, likely fueled by hedge fund additions spared that does look -- additions. bloomberg's a dani burger from what we learned on those filings. let's find out what matt has learned at the munich security conference. matt, is the u.s. there in numbers? matt: they will be here a little later. we are not only mike pence speaker losey and donald trump. selectione strongest of speakers coming to the conference since 1969 they'll be
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pushing for europe to contribute ,ore to your -- nato funding but also showing solidarity with allies. this is bloomberg. ♪
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>> president trump plans to use executive powers to get money for his border wall. we can manufacture data in china raises concerns as trade talks end with little progress there. escape from new york, dropping plans for a second when reporters in queens. -- headquarters in queens. francine: good morning, everyone. good afternoon if you're watching from asia. welcome to "bloomberg: surveillance video


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