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tv   Bloomberg Markets European Close  Bloomberg  July 1, 2019 11:00am-12:00pm EDT

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30 minutes left in the european trading day. i am guy johnson. beenadictory messages have kicked out by -- equities, and we have the miners at the front end of the charge. technology doing well in europe. stoxx 600 is up by .9%, but we have -36 bits on the german ten-year. the bund is rallying really strongly i wonder if that has something to do with who could potentially be the next head of the edc be -- of the ecb. one thing worth noting, the smi is trading strongly today. day one, effectively being cut off from the e.u.. taylor: you're totally right you want to talk about mixed pictures, the u.s. equity market is telling us a different story. i wonder who is right. the equity markets or the bond markets. equity markets were at record highs, and continuing to breach
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the june 20 record we had of 29.54. -- at 2944. now at 2966. to $14s fallen back down per ounce. we take a look at what that means for the two tens. inare spending a rate cut july. trying to get a lift, yields going out to 10 years. the story, as you know, always continues to be about trade in china. you are looking at dollar weakness relative to you on strength -- two yuan strength. asiango over to our conversation, particularly over there with hong kong, we know in the last two hours we had protesters breach the legislative council for our global audience in hong kong. we had an update by sophie, on
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the ground for us. this is as they mark the 22nd anniversary of turning back over from the u.k. to china from hong kong's perspective. we will continue to get more updates from her in about 10 minutes' time, where we will be live from hong kong. guy: absolutely. we are watching it very carefully in hong kong. let's get back to what is happening with the markets. local -- global equities rallying. we are also having something, a rally going on in the bond market as well. mixed messages from global markets per stephen gallo joining us now. what do we take away from the message? equities up as well. -36 on the german ten-year. to me the bonds market has it right. if you look at the minimal amount of r&b strength that we saw early on today, they went with a simple trade.
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the headlines were, this is a good result. everything is fine. we are going to keep talking. but personally, i think the bond market has it right. the bond market is more fearful. the bond market does not trade like it is a cease-fire. it is not. it is neither of those things. it is an agreement to temporarily not punch each other in the face for a little while longer. but really the core issues here. there are very deep-seated issues that will not rectify quickly. guy: so you believe the bond market, the derivative trade-off in your world? stephen: we have been so wrapped up with the g20 and the fed, the amount of r&d rates pressure that has been going on, onshore and offshore, as been pretty intense. if you look back over the course of the last few weeks or months or so, none of the news coming
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out of china has been good at all. one bank at least, a small bank going into receivership or they continue to pump liquidity into the system. they are obviously scared of going too aggressively, but they have a leverage problem and they are doing much of what we saw the ecb do over the course of the last five to seven years. they have a leverage problem, a debt problem, and they seem to be attacking it regularly. that went off the radar screen. in our opinion, you have to buy rmb on dips, and what has happened in china is that regulators have managed to control the balance of payments and they are manipulating rates in a way that is not necessarily going to be a chaotic thing if further.eakens taylor: i posed this question to erik nielsen, and i cannot figure out who is right here. the bond markets, like you
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mentioned, are telling us a very different story than what the equity markets are telling us. the record highs on the s&p, and the -36 basis points on the german ten-year. who blinks first? you are absolutely right, the bond market has it right. we think yields go lower. 10 year yields will hit new record lows during this cycle. an overall, it is a matter of time before geopolitical risk, particularly on the u.s.-china trade impasse pick up again. i sort of tend to agree with the stock market in the sense that there really is not much of a trade here. the dollar is going to struggle for a while in terms of making new highs for this cycle, but we think what will happen is that once the fed delivers the first cut of the cycle, which we think will be in july, that is when you start to get worried again because you want to look
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elsewhere. the ecb is going to be starting its easing cycle roughly the same time. -- thatwill roughly be is a negative issue for the euro. and then once the first cut from the fed is out of the way, we think a lot of investors will go, "well, it is just a rate cut." problems in the global economy are a lot deeper than a simple rate cut from the fed will resolve. so that is where we think you will want to look to get long on the dollar again. after the rate cut is delivered from the fed. taylor: you talk about long dollar. that into dollar-youan. we see dollar weakness. i imagine president trump is relieved about that coming off the g20. we talked earlier about hitting that key seven dollars threshold. do you have a call on dollar-yuan?
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isphen: our six month view seven in dollar r&b. like i said to guy a few moments ago, the thing investors need to get real about is that the control that regulators and china are exerting over the economy, that they are exerting over the financial system, that they are exerting over the balance of payment, means the chaotic disorderly decline in in 2016, is less likely. that means there is less confidence that the r&b can weaken in an orderly fashion. president trump loves to lob grenades, and he is going to use the weakness in other currencies versus the dollar from time to time as a weapon in the trade wars. but ultimately, the white house and the u.s. treasury have to realize that the american-first -- the america-first agenda, the initial onset of it, will lead to a stronger dollar.
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the issues in the global economy , the structural issues are much deeper than the ones in the u.s. currently. guy: do you think buying gold is a good idea as well? stephen: it is just the story of the negative yielding debt out there and what central banks are doing. gold will ultimately outperform in europe, and in r&b terms. -- r&d terms. going to stays with us. we need to talk in if human is about what is happening with the european leadership story, what ultimately that means for the ecb. it could be a factor behind what we are seeing in the bond market today. strategy,llo, head of joining us in a few minutes time. taylor: i want to get to some of the protests we are monitoring in hong kong, emmons traders -- demonstrators hacking their way into ledge co.
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sophie kamaruddin -- we have spoken a lot in the last few , and we are a few hours into this, where protesters are inside the building. at 11:00 p.m. tonight, hong kong for us.ap this up what was the significance of this breach? sophie: after a long day of protests, this is where we saw the extradition rallies last of a, reaching highs million protesters. today there has been a height of activity. in the last half-hour, protesters here prepare for the police to move in, as they are as vies to -- as they are advised that they would. they said they will use a suitable amount of force. against this backdrop of increased activity, the organizers of the official july 1 rally, the civil human rights front, in a joint statement with lawmakers, said they had reached out to the chief executive to
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, which had dialogue reportedly been rejected. they are saying that she is responsible and should be held in the public view to reach a conclusion when it comes to responding to the demands. today'shie, what is protest being classified as? arrests, how are the protesters been classified? do we have any official line as to whether this is a riot or what exactly it is? sophie: there has been a few voices that have come out to condemn this today. you had fernando chung, the vice president of the labour party, saying today plus activity, the violence we have seen, that justifies the government having to stop clashes. today there has not been an
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official classification of the demonstration as such, it again, the police are moving in today. we will see how that engagement unravels or unfolds come and whether the designation of a riot may then be applied, guy. taylor: thank you. that was sophie kamaruddin in hong kong, as they approached midnight over there. i want to get a quick check on where we stand in the u.s.. we have been talking about record highs here. 54 -- 2954ne 20, 29 level. we were off the highs, coming off a little bit, but continues to lead the way, up about 1.1%. it is risk-on as the 10-year in the u.s. continues to remain unchanged at 2%. this is bloomberg. ♪
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taylor: live from new york, i am taylor riggs. guy: from london, i am guy johnson. this is the european close on "bloomberg markets." here is courtney donohoe. courtney code there has been a dramatic escalation of protests in hong kong, demonstrators smashing their way into the city's legislative building, thousands more flooding the streets. riot police retreated, avoiding another violent confrontation for now. the protesters are trying to get the government to ruth draw -- to withdraw a controversial extradition bill. the says it has exceeded cap on its stockpile of enriched uranium. iran claims the european countries have not lived up to their pledge to provide economic assistance. ae u.s. reimpose sanctions
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year ago. critics say president trump's meeting with kim jong-un shows how little north korea has seated on its nuclear program. mr. trump came the first sitting u.s. president to set foot inside north korea. he and kim met at the demilitarized zone and agreed to restart nuclear talks, which have gone nowhere since the president walked out of a meeting with kim in february. deutsche bank is preparing for the large makeover in your. the german lender may reduce the debt count by more than a fifth. by up to 20,000 jobs. is likely to hit the investment banking division the hardest. global news 24 hours a day, on air and tictoc on twitter, i'm courtney donohoe. this is bloomberg. taylor? taylor: i want to get a check on the global markets, a little bit of a lift here given some of the
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trade boosts we saw over the weekend. along with the stoxx 600 in europe, we see lots of green on the screen, investors relieved there is a trade truce between the u.s. and china, and perhaps the tensions will not escalate anymore. this toxics hundred up .9% for a third day in a row, -- the stoxx 600 up .9%, up for the third day in a row. cap the outperformance for the stocks, chip sector, up 2.9% per lots of demands come from from the supply chain and china. we go into the bloomberg. let's take a look at the opening gap for the stocks going all the way back to 1995. these are the gaps up, these are the gaps down. upthe open, the stocks is 4%.
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will it be a breakaway gap to the upside, or will it fail? the highs over the last four days, up 10%. going back to 2010 off of those highs. interestingly, not sitting in the risk on picture, perhaps that we basically have unchanged basically in the u.s. the german bund. investors are seeking the safety of the german bund, amazed that it is yielding -36 basis points, paying the german government to part their money. ofyou go back to the period central-bank accommodation, bonds rallied as stocks rallied with central-bank support. navy we are seeing a repeat of that. let's take a look at oil over the last 20 days. it extraordinary, up 11%. some of this has to do with tensions between the u.s. and iran. on the other hand, we have a truce to some degree in the trade tensions between the u.s. and china. perhaps some traders are hopeful that the demand for oil will be helped out by the trade truce
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and the softening of what is between the u.s. and china. guy: abigail, thank you very much indeed. talking about what is happening in the bond market, the european central bank could be headed for its first ever female president. central contenders include imf managing director christine oecd's chiefthe economist. back with us, stephen gallo, cmo capital markets, european head of fx strategy. we do not know yet. we're waiting to see what is going to happen. but the market is basically signaling that the ecb will have to deliver more and much more. -36 on the bun market. how much is the ecb going to cut this year? stephen: i think it is a matter thosee before they reel
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policy maneuvers out again. a does not matter if it is woman, mickey mouse. the european zone -- the euro zone defies all logic. technically it should not be there. like mario draghi said in 2012, it is whatever it takes it i don't know if whatever it takes is a good idea, but he was worried about the bumblebee. guy: but the bumblebee flies. stephen: but it should not fly, and here is the problem. keeping it together will have enormous cost on the ecb, and everybody is going to be miserable. guy: christine lagarde, or whoever it is, what are they going to do? stephen: supporting the euro zone is going to have dramatic costs, and we think it will come in the form of euro weakness and political tension. it is going to be one of the of ash one or the other. either way, it is not good for
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the currency. possible it will be good for the bond market, but the risk premium they are taking out has to show up somewhere. we have been drawing investors' attention to the balances. one of the reasons they are there is because of a lack of investment in the domestic economy. one of the reasons why the periphery has occurred within account surplus overall is because of the lack of domestic demand. so the economies are weak and still slack. investment is not all staying inside and being put to work in a domestic economy. taylor: you talk a lot about euro weakness. even though the fed is cutting rates, we expect mario draghi or whoever takes over the ecb next to cut even further. do you assume in your model that we get euro-dollar parity? how much deeper does euro go?
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at 1.10 in have it three months, and then it stops. that is where i am going to stop for now in this conversation. 1.10 in three months. we like selling the euro. action in the next several days will be important for how we trade it over the next couple weeks, but ultimately if we go euro-dollar -- overall, the broader, bigger picture, we like euro lower versus the u.s. dollar. taylor: are the incoming candidates dovish enough? stephen: i think the question is, are they pragmatic enough. one of the things from a market perspective, from a euro zone survival perspective, answering the question, how much more life can we buy the euro zone?
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that is one of the strong points that draghi has and is taking with him. i think probably when you look look atnders, when you a contender like ali rain, you see a pragmatist. that is probably where we are headed in our view per that is the lazy consensus. we probably side with the lazy consensus. ultimately, politicians should be taking the tough decisions, but they cannot because there is not much unity and there is a lot of fragmentation. so a lot of the heavy burden is going to be shifted to the ecb. do you think today is about pricing out -- i am curious about today's move. stephen: in euro-dollar? guy: you would meet a guy who would intentionally keep a lid on things a little bit more. is that what today's move is? stephen: i don't know. the data will leak and everybody
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can see for themselves. there is not that much hope here for an organic euro zone recovery. the external factors are very weak from a european perspective. the low delta tale risk scenario, if we were to get public imports on fiscal policy, whether from germany or the euro zone in aggregate. if we were to have that, there is a likely test there is a higher likelihood -- there is a higher likelihood that he would take a much higher spot in the ecb. stephen gallo, joining us. thank you very much indeed. ♪
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guy: not long until the europe closes up for the day. it is certainly up. ftse, daca, and -- ftse, dax, all trading higher. the european closes next. this is bloomberg. ♪
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guy: 30 seconds to go until the end of regular trading in europe. a positive session underway.
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the bill of outperformance in norway. europe trading strongly, around 1%. ftse trading just north of 7500 .nd up around 76 points some of the health-care stocks doing well, the miners are doing well, the oil stocks helping out. dax trading of 1%. the smi trading above normal volume. this is day one of being cut off from the european exchanges. seems to be going ok. i think it will be a longer-term story to see whether this had a real effect. let's turn our attention to the second -- the sectors. risk on mode for european equities. technology the gainer. chip stocks doing well. oil and gas is a heavyweight. trading up 1.4%. carecial resources, health
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, an interesting mix in terms of the breakdown. health care trading strongly. between high beta and low beta, defensive, less defensive. at the bottom of the market, not much. there are a few sectors in negative territory. let's turn our attention there. one sector we find ourselves with, that is food and beverages. that is a more defensive area. that is a more bonds like proxy name. the bull market is rallying. not seeing a similar story. in terms of the bond market, you are seeing the bond names less well traded despite the fact that we are seeing a rally in the european market. talking about the european market, the real action has not been in the equity market. it has been in what is going on -- this is the bund now back into record territory.
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you would've thought of the market was risk on, you would be seeing this going in the opposite direction. yields have gone down. on prices have got -- bund prices have gone up. does not quite fit. taylor: we are seeing a similar theme in the u.s. it is all about record highs within the s&p 500, better than the 2954 we had on june 20. session ands of the the risk on means dollar strength relative to a weaker yen which is the classic safe haven trade. you pull that open into our bond world, 10-year gilts unchanged. equity markets higher and you are not seeing a selloff in the bond market. that ten-year holding it at a 2.01 and a little bit of the crude story. we did get an extension of the opec cuts and you are seeing brent get a list. not quite hitting $65 a barrel.
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if we flip up the board, it is about the technology sector. we are getting a truce on the trade front. thenasdaq and the sox highest since may. best one-day gains since june. that means the vix is below a 15 handle. flatten.ontinues to still creating a very flat yield curve. guy: absolutely. you mention crude. let's get back to that story. opec plus agreeing to extend production into next year, nine months according to delegates at the meeting. news, butigher on the just beginning to fade that rally, up .3%. horton is that the opec building in vienna and joins us now.
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the saudi's and the russians pulling all of the strings. amory: that is exactly right. baked into the market considering the fact that even in june when they sat they werede together, talking about the need for further cooperation. they said a rollover is in the bag. they need to work out the logistics. we had president clinton signaling they need to work out logistics, similar to what we saw in 20 16 in when is there is. these communications are coming from high-level and the leadership levels of the countries and not even from an opec member. russia is part of the opec plus group. oilur strategist in the team says, they have finished their takeover of opec, russia. vladimir putin is the absolute csaries are now -- energy
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now. taylor: i wonder what do they want. we cannot break $65 a barrel on brent. what are saudi and russian opec members really want to see? annmarie: it is obvious the saudi's and other nations will likely be targeting price alone -- will be targeted to much higher oil prices, $80 or north. brent is not even up a dollar, it is up less than a dollar. this is a day we had a truce between beijing and washington, an extension of an opec cut for nine months and we had the iranians going over the limit of enriching uranium, highlighting tensions in the gulf. why isn't oil spiking more? the market does not think the deal goes far enough and everyone seems to be worried
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about 2020 demand. the fact that opec will cut into 2020 when the russians in st. petersburg were saying they want to take this wait and see approach and now the were willing to going to 2020, is demand looking that bad? the iea warning us there will be -- you wouldsupply expect to see higher prices. how week is demand in 2020 is the big question. if you look at the global pmi, it has been uniformly week. be expectations but it is still down on the previous month. the manufacturing story is not good. i'm wondering how much talk you heard about that, despite what is happening with the cuts they are still behind the curve? annmarie: this is the story of today and why they extend these cuts. they said the market is still on
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balance but we have heard that since november 2016. the oil minister said he thinks the market will be balance by december of this year but they say this every six months. this is clearly a slowing of demand story. not just the global growth concerns in the trade war concerns, it is the fact that we have the behemoth of u.s. shale coming onto the market, pipelines in the permian, and new fields in norway, brazil, canada. this is shrinking opec share. guy: thank you for much indeed. annmarie horton joining us from outside the opec building in vienna. taylor: another story we have been following his deutsche bank. present's plans for job cuts as soon as this week. bloomberg has learned that as many as 20,000 positions are on the chopping block, many within the equities trading division.
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in the company's new york office, signs of impending layoffs are easy to spot. we are joined by bloomberg's sonali. i want to talk about the size and scope of 20,000 layouts. on friday we were talking about how it was global. is this more targeted toward the u.s.? sonali: this is definitely a global restructuring. the u.s. is just an important base for the investment bank. if there are cuts at the u.s. investment bank, we can expect a bigger retreat. 20,000 across the world may be far more than the investment bank. guy: i've a chart which shows the risk that is being priced into deutsche bank and from a credit point of view, it is going down. the market likes what it sees is feels that maybe deutsche
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getting a grip on the situation. what does deutsche need to get back to if it is to become a normal bank? door wethroughout the have had great reporting from our colleagues in germany. are they going to be focusing more on the retail consumer? that is a question. did have arica potential for $5 billion in a , somethingse deutsche bank wants to avoid. it did not seem to be factored into the stock. guy: we are just getting headlines. let's bring them to the audience. 1300che bank to cut around regional operation roles by 2022. the deutsche bank retail has, -- i do not memo know if it has gone out in a memo, we have seen a memo which suggests around 1300 retail jobs
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will go. in terms of the bulk of the cuts, they are likely to be in , maybe more of a focus cib.e c in the sonali: the retail cuts are a big question mark. know is whatant to the bank looks like in the next two to five years if they are cutting retail jobs, investment banking jobs, and where the jobs will come from. part of the rationale between not merging with commerzbank at do with thousands of job cuts. taylor: thank you. as we've been bringing you headlines of deutsche bank cutting 1300 of the real kill cutting 130022 -- retail jobs by 2022.
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a lot of moving parts as we await that july 8 deadline when we expect to get more news on deutsche bank. guy: that news could come over the next few days. it is interesting you focus on what is happening with that asset management side of things. all of these european banks hoping the asset management side of things will be what rescues them. they are hoping that part of the business does well. interesting in light of what we have seen with hto -- with h2o over the last two days. just getting the settlement in europe. not much movement in terms of price action. followinghigher sideways trade for european equities market. those are your closing prices. do not forget to tune into the cable show at the top of the hour if you want to continue with the action. jonathan ferro is back in new york. he will be joining me on the other side of the pond. dab digital radio in the london
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area and around the world on all of your bloomberg devices. ♪
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taylor: live from new york, i'm taylor riggs. guy: from london, i'm guy johnson. close" --he are being this is "the european close" on bloomberg markets. courtney: a dramatic escalation of the protests in hong kong. protesters smashing their way into the city's legislative building. thousands more flooding the streets and riot police retreating, avoiding a violent confrontation. the protesters trying to get hong kong's government to withdraw a controversial extradition bill. nationsdefying european
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who urge you to stick to the terms of the nuclear deal. iran says it has exceeded the cap on the stockpiles of uranium set by the agreement. that europeplained has not lived up to his pledge of an economic lifeline. the deal was designed to prevent iran from building atomic weapons. a mixed message from the new economic report in the u.s.. factory activity fell by less than forecast, but new orders fell to the lowest level since the end of 2015. two american billionaires making 10 figure donations. donating 4.6t billion dollars in berkshire hathaway stocks to five charitable organizations. since 2006, he has given away 45% of his holdings. -- theton donated recipient has not been disclosed, but the walton
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separate yearly donated to the walton family foundation. global news 24 hours a day, on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i am courtney donohoe. this is bloomberg. taylor: thanks. as you were mentioning, some hong kong news. i want to get back to the big protests we have been monitoring in hong kong. sophie is across the road from the building. sophie, we approach midnight in hong kong. can the protesters classified today as a success? it depends on what the interpretation of success is. earlier, when they broke through the barriers and gained entry to the building, one could see that as a victory for those protesters but the police have indicated they would move into clear the protesters. we have seen some of this beenity, the crowd has somewhat as protesters are
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seemingly leaving of their own pollution being police have said they will use a critical amount of force to empty the area. the police have condemned the action of rioters who force their way into the building, but the protest itself has not been classified as a riot. in an official government response, the government did note the protest was conducted in a peaceful manner and condemned the actions of radical protesters. there is not been a direct response from carrie lam who has been called upon to resign. ae had rejected a request for meeting with the organizers of the july 1 rally. -- guy: you are saying the protesters are beginning to leave. was there a concern the police may be heavy-handed? there was a concern this may happen.
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given the recent caution we have seen from the authorities, i'm curious about that kind of thought process. sophie: these demonstrations have occurred and there is a call for an independent inquiry into the clashes that took place on june 12 when the police deployed 150 rounds of tear gas using rubber bullets against demonstrators who were in the streets protesting against the extradition bill and calling for the resignation of the chief executive. today we have seen a scale back in terms of police presence. that was part of how one could say the protesters were able to gain entry into the building, they were impeded any clear presence of security or police forces. we did see a clash between police who used pepper spray against protesters who attempted to disrupt the annual flag raising ceremony held at the waterfront in hong kong. guy: great reporting.
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thank you for staying up so late for us. taylor: time for our stock of the hour. shares of rail company genesee & wyoming are trading at a record , jumping 9% after brookfield asset management agreed to buy the company for $6.3 billion. kailey leinz here with more. kailey: the total deal is $8.4 billion, but the $6.3 billion in stock is equivalent to $112 a share. that is a premium to where genesee closed on march 8. that is when the rumors first emerged they were exploring a sale. that has finally come to fruition. genesee is a short line freight operator. lines,n the connecting they have about 120 freight railroads worldwide and they do not compete with the larger guys like union pacific, but they run the short lines, really happy or the -- really heavily oriented
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to the u.s. that is what brookfield is trying to get into. guy: what does brookfield see in this deal? kailey: rail is pretty hot right now. the shares have had a healthy rally. genesee sat that out somewhat. their operating ratio is actually the highest among their peers. on that metric you want to be lower. their operating ratio is 85%. they are implementing that method that could improve the ratios. you could see bigger profits. when you look at their freight category balance, something i want to note is they are heavily exposed to cold, almost -- heavily exposed to coal. that is a at the nation for why there's a bit of hesitation as to why this deal is happening. guy: coming up, it is time for the global battle of the charts. you can find all the charts at
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gtv . this is bloomberg. ♪ xfinity mobile is a wireless network
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guy: 53 minutes past the hour which means it is time for our global battle the charts. you can find all of these on your bloomberg by running gtv . kicking things off is john hyland. the firstlooking at half of the year with stocks and bonds rising in tandem all the way back to 2010. we saw the best total returns for stocks and bonds since 2010. the question is what happens going into the second half of the year. today you saw the s&p hit a new intraday record as bond yields remain unchanged at 2%. what is to be expected, will this be the bonds for the bulls. in theson said earlier last five occasions since 2013 when he saw stocks and bonds rallying in tandem, you saw stock bulls win out over the
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bond bulls. fomc meeting at the end of the month with investors pricing in a rate cut, but it all comes into the jobs data we have friday. you can save this chart by running gtv on your terminal. guy: nice chart. taylor? taylor: for me it is all about -- or me it is all about the global pmi data. i will look at the market data we had at 9:45 a.m. eastern. my team continues to be u.s. versus the rest of the world. the u.s. continues to get it done. it is coming in better-than-expected with a 50.6 print relative to expectations of a 50.1 print. ,he data says everyone else euro, u.k., china, continues to be an retraction territory. we have spoken to erik nielsen of unicredit talking about this. what catches my eye is the u.s.
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continues to remain in expansion territory, coming in better than estimates. the equity market seems to agree u.s. versus the rest of the world. you can find this on my terminal at gtv . guy: i wonder whether taylor's chart will prove that the bond market is right rather than the equity market and take the point that both are -- i take the point that both the rallying, but i think there's a good connection between the charts. the data out of the states not amazing, but better. the rest of the world looking top. taylor riggs is the winner. taylor: good cohost. good cohost. guy: have to play the game. nice win. balance of power is coming up. david westin will be joined by michael pillsbury, one of the hudson institute's china experts to talk trade and what is happening in hong kong.
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a quick look at you as markets. from an equity point of view we are seeing a rally. the bond market is going sideways, drifting sharply in europe. -36 on the german ten-year. it does not look like that amazing a rally. what we got out of the trade story largely baked in. equity markets positive without rally being feted. fetedt is david -- being b -- being faded. pictures out of hong kong amazing. are the police going to go in or will protesters take their leave? from taylor and me, have a good afternoon. this is bloomberg. ♪
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david: from bloomberg world headquarters in new york, i'm david westin. welcome to "balance of power," where the world of politics meets the world of business.
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on the brief today, michael mckee on the trade truce. from brussels, maria tadeo on the european union continuing to struggle for successors, and sophie kamaruddin from hong kong on the drama playing out with protesters occupying the legislative council building. we had our own trauma playing out on saturday with president trump and president xi meeting. what came out of it? michael: what wall street expected. president trump and president xi said we have agreed to continue negotiating. no details on a time frame, just the idea that they will talk again was good enough for wall street. emphasized that is part of the agreement he will allow wall way to buy parts from u.s. manufacturers. he put it is a good thing for american companies, but a lot of


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