tv Bloomberg Markets Americas Bloomberg August 2, 2019 10:00am-11:00am EDT
markets. have we pivoted? mr. kudlow: no. i will go back to what you said. we have had a hack of a year. the indexes are up 20%. i think that is foreshadowing a i think that foreshadowing a very strong economic growth period into 2020. it's been a fabulous stock market. and encouraging to me, in terms of the key sectors, the industrial sector, transports have had a terrific come back. i noticed chips and semiconductors, too. that tells me that any pause in the economy in hard goods last year, undoubtedly related to the monetary tightening by the fed, that may be coming to an end. that's why i'm pretty optimistic when i look at today's job numbers and see all of these, literally hundreds of thousands of people returning to the labor force. something very good is cooking
out there. jonathan: the president said he is not concerned about the negative reaction for markets. is that a change in stance from the white house? kudlow: know, as i understand that he is just responding to the media response. a day or two in the stock market doesn't make a trend. jonathan: last week was really confusing. outrolled out -- you ruled fx intervention , and then the president said he hadn't ruled it out. kudlow: he said having a strong dollar, there's a reason it's so good. having a strong dollar is having a strong dollar. having a strong currency shows what an amazing country. i stand by those remarks. i thank him for making them. we haven't ruled out any currency intervention. , and theem here
president has said many times, it is not that our dollar is strong and reliable and dependable. we love that. money is coming here from all over the world. we are the hottest economy. where the only real major country with solid growth and investment returns. the problem here is the president is concerned, correctly in my view, that other countries may be manipulating their currencies, perhaps to get some short-term trade advantage. we don't like that. we want a level playing field. the g20 arrangements have always called for currency stability, as secretary mnuchin would attest. that is the issue. we worry more about what the others are doing. we are perfectly happy to have the u.s. dollar as the center of the world's economy. we are the world's reserve currency, and we aim to keep it that way. jonathan: with that in mind, ton can we expect you
label these countries as currency manipulators? secretary mnuchin has expanded his watchlist. that is a treasury function. i will leave it to him. he's a very smart guy and a great leader over at treasury, so we will follow that story as it unfolds. jonathan: larry kudlow, thanks for catching up. the national economic council director joining us from the white house. here on bloomberg tv, we are back for some final thoughts. anastasia, your thoughts. anastasia: i think larry kudlow ruled out a lot of the worst case consequences, so i think there is a constructive message to be had, and the bar does seem to be pretty low for china to agree to some of these agricultural purchases and potentially move us forward. i think the pullback we are seeing in the markets could be a buying opportunity, so anything that positions a little further
toward september is how i would think about this market. jonathan: michael collins. michael: you really have to think about the knock on effects. weaker investment spending can lead to weaker hiring and consumer spending. i think we are starting to see more evidence of that trajectory. the final word is the fed policy works for confidence channels, and i'm not too confident about what is going on in the u.s. economy right now. jonathan: i don't think you are alone. guys, it's been fantastic to catch up with you through the morning, post payrolls and post that tweet on trade as well. the scores look like this this morning. the morning to you all worldwide on this payrolls friday. equities are lower by seven tons of 1% -- by 7/10 of 1% on the s&p. looking like this in the treasury market. yields 1.87 on a 10 year maturity.
in foreign exchange, risk aversion there to see with a stronger japanese yen. ,ollar-yen down one half of 1% 1.06 -- 106.76. this was the countdown to the open. this is bloomberg tv. ♪ vonnie: is just after 10:00 a.m. in new york, three a clock p.m. in london, and more than 30 minutes into the u.s. trading session. from new york, i'm vonnie quinn. guy: from london, i'm guy johnson. welcome to "bloomberg markets." vonnie: economic data broke just a few them's ago. michigan sentiment data coming in just shy of what economists were looking for. current conditions dropped, but expectations were higher than the previous reading. , nondefenseint out
the most important bunch of that data, came in at 1.5%. slightly disappointing. it was down from the previous reading of 1.9%. we just heard larry kudlow talking about china tariffs, saying he didn't want to front run the story, but that there might be something coming out of beijing today, and that there was a whole month before new tariffs were supposed to come into place. it sounds like it is still all up in the air. the s&p 500 has lost almost 100 points from its most recent high. it is down 7/10 of 1% today. some individual stories making that happen, but also these terror threats. the tenant -- these tariff threats. the 10 year yield still at 1.87. the yuan reached almost 6.98 offshore. the pboc sent a very direct message today, setting fixed income rates stronger than 6.9, saying it favors stability over
any minute galatian of the currency. offshore, there is a big spread -- any currency manipulation. offshore, there is a big spread. guy: european stocks are down, playing catch-up. the dax down nearly 3%, the cac down 3%. the german 30 year went negative. the entire german curve a little earlier this morning was negative. we bounced a little bit in terms of yield since then. prices fading. the havens are certainly catching a bid. euro swissie leading by half a percentage point. vonnie: a lot of factors weigh in markets this friday. trade concerns, along with economic data. u.s. employers adding 160,000 jobs last month, just to have expert patients. the unemployment rate holding -- just shy of expectations. the unemployment rate holding. joining us now is michelle
natwest markets managing director. a whole month before the new tariffs come into play. how are markets supposed to trade today with trump tweets, the jobs report that didn't particularly disappoint, a fresh batch of economic data, and fomc talking about midcycle cuts? what are markets supposed to think? michelle: markets have to recognize we are in for a lot of volatility and ongoing uncertainty. this is i think the legacy that will linger. this latest escalation in the trade war, these tariff threats, even if they were to be resolved in short order, which i think we are sort of skeptical about, it harkens back to what we saw with mexico, the sudden about-face that came when the mexico tariffs were out of the blue threatened.
here we have the president talking about instituting new we saw theay after trade negotiations characterized this. markets,m line is for it is very hard to take any longer-term assumptions. because at any point, there can be a tweet that changes the situation or some piece of news that radically alters the backdrop. this is what i worry about in terms of the economy. even if we get a short-term resolution, the lingering uncertainty that at any moment, something new could be thrown in is something that i think it's going to keep an air of caution here on the part of business that will lead to some cooler activity. vonnie: and then of course, there's another threat. easternan event at 1:45 both to address europe and potential europe tariffs. that is the big other threat
looming, isn't it? michelle: all across the world, we are worried about less re-trade, less globalization. in no way do we feel comfortable that these issues are going to go away. even when we talk about the u.s. , when things seem to quiet down between the u.s. and china, we saw the president turn his sites to europe. does a lot of ongoing uncertainty, and i just keep coming back to that. safe.sses need to be we had a good jobs report this morning, 164,000 new jobs created. that is on pace with the year to date trend. but this is down from jobs growth of over 200,000 coming into the year. so i think we are seeing some evidence that companies are getting a little bit more cautious on both the investment side and the hiring side, and it
is a direct result i believe of the uncertainty that they face. guy: have we reached the point where has reached a bottom? companies have cut back on capex as much as they can. the next step they have to make is cutting back on hiring. michelle: we certainly haven't reached the bottom on what can happen on the side. we seen capital spending flat over the first half of 2019. 2016, we saw early four consecutive quarters nearly of decline. very weak readings, even in the middle of an expansion. so you cannot rule out the potential for firms to cut back further. i do want to reiterate, but larry pointed out was true. we had some very good numbers for june, even with the dollar division to 1.5% gain for capital goods orders.
all is not lost, but you are right. lastmpanies were to invest and move more to hiring, one of the arguments there is that gives companies more flexibility if things turn down to shed workers. they may have that flexibility or that shift we have seen, where hiring was seeming to dominate investment. that may be one of the ways companies give themselves the flexibility to respond in an uncertain world. guy: the market went yesterday from pricing september at 60% to pricing it cut -- to pricing a cut at 90%. an the fed now avoid a further rate cut? michelle: i think the fed would acknowledge it is all going to be dependent on what evolves over the next six to seven weeks. our view is that the fed will cut rates again in september.
supporttalked about the that the economy has felt from the loosening and financial conditions as the fed has shifted from talking about raising rates to now cutting rates. if they don't deliver on the easing that has led to the easier financial conditions giving the economy support, then that support is going to evaporate. our view has been, even with the markets were somewhat skeptical, that the fed will ultimately be forced to follow through with the rate cuts. vonnie: we had two different reactions in the last 24 hours. equity markets were rallying, , and then the tweets came and we see the s&p knock nearly 100 points off of its high. the bond market is rallying, however. we are seeing that really continue today. what is one market seeing that the other is disagreeing with? michelle: i think what was happening yesterday was you
could tell in terms of the improvement in the bond market that there was an ongoing belief that we were going to get the fed cutting interest rates. evidentling i think was . it doesn't matter if the fed chair today is convinced. the bond market was betting very strongly that the market will need to move. that was providing a little bit of support for equities. but now when you've got the threat of an escalation in a that might threaten a more serious downturn in economic outlook, of course that is a positive development for bonds, but you can understand why it is quite negative for equities. guy: we will leave it there. stay with us, though. michelle girard joining us from natwest, where she is the chief u.s. economist. we just traded at session lows.
the ftse 100 is down, but the dax now down over 3%. look at the cac, down by nearly 3.5%. earlier on, we saw the entire german yield curve trading in negative territory. yes, the 30 year when negative. that is an interesting indicator ahead of what is going to be a fascinating september for the ecb. more market coverage next. this is bloomberg. ♪
where this market are globally. here with the details, emma chandra. emma: the places to look on where the pieces of the market puzzle have changed over the last one to four hours, the fed, u.s. jobs data, and tariffs. it appears that escalation in the trade war is having the biggest impact. the hang seng closed earlier, down 2.3% in the red. you mentioned european markets at session lows. the stoxx 600 down 2.3%. the s&p 500 looking to move towards a 1% fall. today the s&p 500 is headed for its fifth consecutive down day come on pace for its worst week since the december selloff. meanwhile, the vix, the measure of volatility headed for one of its longest stretches of gains since october of last year. that is really reflected in bonds, highlighting the german bunds here today.
we saw for the first time the full year -- the full yield curve fell into negative territory. the 10 and the 30 year yield falling to all-time lows. in terms of the movers, i want to mention apple. exposedhe most trade exposed ons supply side. effective earnings earlier this week. guy: with us still is michelle girard of natwest. if theing to decide tweets yesterday were directed towards the fed or china. michelle: i think these were
geared more towards the chinese. the president likes to make threats to gain concessions, so this is consistent with that behavior of trying to move the ball forward, trying to make sure china understands it can't just wait this administration out, but let's face it. the extent that it in anyway puts more pressure on the fed to , that thesome extent fed is there to sort of have the economy'sack or the back while the president is fighting its fight with china, it makes it certainly easier to go down this road. guy: so the fed is under attack a little bit from the president, let's put it that way. michelle: yeah, ok. i don't know that they are under attack, but clearly the fed has stated a willingness to do what it needs to do to keep the economy out of recession. that gives the president more actions that might
put the outlook more at risk because the fed is committed to doing what it needs to do to offset. thehat way, i think president gets more free reign to fight the tough fight with china. vonnie? vonnie: the trade deficit widened, but only very slightly. we are talking about $100 million with china. are we seeing any impact yet in the pocketbooks from these initial tariffs? michelle: no. the impact has been pretty limited. at the ways, if you look trends, you would almost argue sortthe tariffs have been of supported, if you will, with imports from china looking to be a little weaker, exports staying stronger, and general over the
last six months. than think more broadly just the trade balance with china is the extent to which there has been an impact on the overall economy. the answer is really no, but that is because the tariffs that have been put in place, the administration has gone out of their way to avoid impacting the u.s. consumer. the tariffs that have been put in place were really on goods that were capital type goods. nothing that would be felt by the u.s. consumer. the fact that we aren't seeing much of an adverse impact by what is in place now doesn't necessarily mean that will continue to be the case going forward because of course, if we put tariffs on the additional $300 billion in goods, consumer goods are going to be affected and consumers will feel that. that is i think something that
markets are focused on now, that it is going to be very hard do not see a more noticeable impact if tariffs are broadened on all goods coming in from china. vonnie: we are seeing a bit of a bounce back some agricultural commodities. stocks like mattel and hasbro are down 5% apiece because they are the things that would be included in the next round. can i ask about the disparity between what officials seem to think will happen and what markets and irregular consumer seems to think would happen? today you had the offshore yuan trading at 6.97. on the other things, you have larry kudlow acting like, don't worry about it. there's still a month left. there's something coming out from china today. officials seem to think it is all going to be fine, but why would they expect markets to believe them? michelle: i guess a couple of things.
let's get the bloomberg first word update. here with the details, kailey leinz. kailey: china promising to take countermeasures if the united states goes ahead with planned tariff hikes. the commerce ministry says president trump's announcement violates his agreement with president xi regarding the trade war. the statement said, "all the consequences will be borne by the united states." in the coming weeks, the united states plans to test a new missile. that would've been prohibited under a landmark arms can coal -- landmark arms control treaty , signed bys today president reagan and mikko gorbachev. -- by mikhail gorbachev. the european union has narrowed the field of candidates for the top job at the international monetary fund. christine lagarde resigned this month to lead the european central bank. the imf's next leader will
confront a world economy at its weakest since the aftermath of the financial crisis. bank of england governor mark cohen calling out mark gary his former -- out cohn after his former colleague jumped into the debate over brexit, telling him simply, "he's wrong." 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. i'm kailey leinz. this is bloomberg. vonnie: big energy beats. chevron and exxon posting better-than-expected earnings today, thanks in part to the oil output surge in the permian basin. meanwhile, oil headed for a week of declines, posting its biggest one-day drop in more than four years on the back of trump tariff threats yesterday. today, oil is recovering just slightly, but still trading in the $55 a barrel range. let's bring in tina davis,
bloomberg managing editor of commodities. exxon can't catch a break. they beat, and as soon as the market opened, they are downhill. tina: they are obviously feeling the wider effect of what is happening as markets digest all of the trade talk that's been going on back and forth, and larry kudlow appears on multiple stations to talk about what the next steps are for those negotiations. for both chevron and exxon, the good news was production numbers. both of them are doing a lot better in the permian, where they are focusing a great deal more. these are big oil companies that missed the boat the first time around, so they are coming in with a lot more money and projections for growth going forward. where they missed, overall the revenues are down year on year, and that's because we seen the oil price drop in the first and second quarters this year. two or three years out, do
these companies have the reserves necessary? tina: if you look at astonishing figures on both of the slide decks for exxon and chevron, you see exponential growth in the permian. if you're talking about exxon, this is a complete ahead almost nothing in permian five years ago, and now they are talking about 1.5 million barrels a day by 2025. that is a huge run-up. chevron is just about the same. chevron bought a bunch of assets in the permian and sat on them for a while, and now they are investing a lot more heavily. what you may be seeing also is some criticism in the market about how much spending is going on by these companies. obviously the smaller e&p's have been hit on cash flow. how theyconcern about will trace these production numbers. vonnie: we should point out that exxon's net income is still down about 21% from last year, so it has been a tough year. one-time items as well. bring us the headliners.
i know there was a termination fee which helped exxon. ofa: chevron is sort laughing all the way to the bank after abandoning their deal to buy anadarko. a huge part of their earnings is that nice chunk of change they got from cashing that check. in exxon's case, they also made about 500 million dollars because the province of alberta lowered its corporate tax rate this summer, so we have seen the tax rate come down 4%. this resulted in a great deal of earnings for exxon, which has a huge footprint in the alberta will fields. -- alberta oil fields. guy: more and more managers and sovereign wealth funds are refusing to have stocks like these in their portfolios. what effect is that having? tina: we haven't seen a great effect yet. it is going to have a long-term effect if you limit your pool of potential investors. that can't be dismissed
entirely. if you look at what the europeans have done, there is more impetus now for the u.s. majors to make themselves into a slightly greener product to make sure they don't lose mazer investors and investors that have esg concerns and environmental concerns going forward. have we seen an effect so far? i don't think so. we have seen good results and earnings and stock performance from the majors. but going forward, i think it is a long-term concern. vonnie: we are seeing wti today at $75.21, up 23%. we have seen a major week for commodities in general. what are they supposed to make of these trade headlines? tina: we did see the bloomberg commodities index have its worst single day since november yesterday, mostly because of oil's reaction, really strong reaction to the trade headlines. one of the things we are taking away from that is that it is coming, for investors, a lot more focused on the demand side
of things. for oil, supply and demand has been a concern, as we seen from what is happening in iran and venezuela that are -- iran and venezuela, etc. now the focus seems to be more heavily weighted to the global economic scene and the trade were continuous unabated -- the trade war continuing unabated. guy: as these companies push into the permian, presuming that gives them a lot more flexibility to follow up -- a lot more flexibility. to follow up on vonnie's question, if you are exposed to shale more than the big long-term projects these comedies would have traditionally been exposed to come up resume of they have more flex ability to turn production on and off, manage cash flow and capex a little more. are these becoming different companies if they get more exposed into shale? tina: i think you could argue that the oil market is slightly
different because of the huge expanse in shale production. we saw last year, in terms of aerall start to finish, was 0.2% change in wti in intermediate oil prices over the course of last month. that is the lowest rate of change we have seen and oil market. for a long time, people have been saying that shale is going to but i ceiling and floor on oil prices, something opec has tried to do in the past. we talked about lower for longer after the 2014 collapse, and now it seems to be that, excluding yesterday's wild gyration is one exception, but if you're looking at overall pricing, it may just be kind of a more boring oil market going forward. vonnie: never boring. bloombergs tina davis is always on top of it all. guy: u.s. secretary of state mike pompeo is criticizing china
for trade practices in increasing pressure from the trump administration. bloombergs haslinda amin spoke exclusively to the secretary of state earlier today. pompeo: for decades, china has taken advantage on trade against the united states and countries in asia. it is time for them to stop. president trump has said we are going to fix this. to fix it requires determination, and that is what i think you saw this morning. the president is determined to achieve this outcome. what we are asking for is really easy. indeed, the chinese agreed to it at one point, and then walked away from the deal. haslinda: what is it? is it while way -- is it huawei at the crux of the deal? the pompeo: this is about central idea of how trade will
be conducted around the world. is it ok for a nation to put on enormous tariffs when the other counterpart won't do that? is it except will to put tariffs and barriers on american companies investing in china when the united states is wide open to those investments? it is really simple. it is the golden rule. it's what you teach your kids. do unto others. we want fairness, evenness, reciprocity. these are core concepts. when that happens, asia will thrive, south east asia will thrive, the united states, the global trading system will survive. but it cannot be the case that a nation uses protectionism to protect its own goods and uses predatory tactics to deny other economies the chance to grow. haslinda: at what cost? we are seeing pmi's around the world already easing. we are seeing companies revising downward growth projections. yes, the u.s. is in a good position leading global growth come about with president trump growth, but with
president trump saying he will hell"- he will "tax the out of china -- sec. pompeo: there are negative implications for every business in the room, but we will fix this. focus fromhat is the the committee on foreign investments in the u.s., which will play a huge role? there are about 173 chinese companies worth about $750 billion actively listed in the u.s.. just chinese companies in the u.s. could you be sending a nehese co are interested in putting money in your country? sec. pompeo: we welcome capital
that comes to america, every day, all day. what we want to make sure is the basis on which that capital flows into the united states. we want to make sure that american capital that wants to come to china can do so on a fair on diva and basis, and that capital doesn't pose a national -- fair and even basis, and that capital doesn't pose an actual security threat. it is whatever nation will do to protect its own sovereignty. our messages to come to america and participate. don't subsidize. don't create champions with political objectives. make them economic objectives, and when you do, many chinese companies will come to america and be very successful, and we welcome that. guy: that's haslinda amin speaking to the usa area state mike pompeo -- the u.s. secretary of state my pompeo, reinforcing some of the messages we heard from the president. we are trading at session lows on both sides of the atlantic. circa 3% since
the president's tweets yesterday. a lot of red on that screen right now. we have seen significant bond market moves as well. strong bid being attached on both sides of the atlantic. volatility picking up a little bit, but not by much. both sides of the atlantic down hard. european markets down by over 3% as they run towards the close. this is bloomberg. ♪
it is time for our etf friday segment. recently they had a new record. seyo tell us is james ffart. reporter: in july, we had etf's breakthrough a 20 basis point level. the asset-weighted fee for u.s. etf's was below 20 basis points, so every dollar invested in u.s. etf's is paying on average 20 basis points. this is just the overarching trend from high-cost and low-cost. all of this is like a self-perpetuating cycle where investors are putting money into cheaper products, issuers issuing these products are lowering fees on existing ones and launching products with lower fees. it is a self-perpetuating cycle as investors move around. guy: the question i am supposed to ask is how low can this go. i am wondering if it is zero. presumably, we can't make money
at that point. james: there are a couple of products that aren't getting much assets that are zero or below zero that will pay you to invest. basically, we don't see the trend stopping anytime soon. if you look at assets or where the money has gone, year, 90% of basis point level. if you look over the last year, it is around 10 basis points. we see it possibly going to 10 basis points in the next 10 years, but we don't see the trend stopping anytime soon. vonnie: what does it all mean for the industry? james: from the investor side, it is obviously a good thing. there's also a lofty medicine returns. a couple of decades ago, we've gone from a 1% fee down to 10 basis points in some cases. that is a huge deal for investors over the long-term. how we are going from 10 to seven basis points.
not a big deal for the average investor. for institutional names, it means a lot. on the other side, asset managers have to match what investors are doing. investors are going towards a satellite approach where their money is going to cheaper data, and 10% to 20% is going to other products. . high active share, high-octane equity asset management. we also see a kind of bucking in the trend in actively managed fixed income funds. advisors and investors seem to view fixed income investors is worth more money than equity vector managers. seyfert -- james fart with bloomberg intelligence. emma chandra is in london. the global readthrough is key to
these results. the parent of ba, long-haul destinations really helping iag in this quarter. ba is one of the few airlines to report rising profit. the iag overhaul, one of the best-performing companies out of the major airline companies in europe this year. the ceo really putting that down to the diversity of the portfolio. the company also maintaining its bullish outlook for the year ahead. i should point out that iag shares this year still lag air france klm. guy: so there's a threat looming. turbulence on the way. that is coming in the form of a strike. british airways pilots, they don't normally strike, and they are about to. these results kind of highlight
the risks. the numbers look great. the airline is on track. does he really want to mess it up with a strike? emma: that's why a number of analysts have questioned the company maintaining this bullish outlook for the rest of the year. iag of course losing that core battle earlier this week to prevent a pilot strike. talks are still ongoing, and there's still 14 days the pilots union would need to get a strike , so that would give them plenty of time to strike within the summer season. it is a very popular time to travel. ba estimates a part of strike would cost about 140 million pounds per day. nevertheless, the other airlines in the portfolio would take advantage of that. whether or not it would make up for what a pilot strike would cost them. also, the economic environment is a bit of a concern for iag. we know we have people concerned about global growth outlook, demand outlook, and we certainly
saw weakness in the cargo numbers in this earnings report. guy: and they just launched their new business class seats as well. emma, thank you very much indeed. vonnie: it is time for the latest bloomberg business flash now, a look at some of the biggest business stories in the news right now. -- secondpital quarter withdrawals of 849 million dollars, bringing assets below $10 billion for the first if -- atears, at talks och-ziff. alphabet's google is trying to fend off more scrutiny. it will require competitors to enginesave its search included on android devices.
a deall soup has inked to sell international operations to kkr. deal completesn the asset sale plan announced last august. the company trying to pare down debt. that is your latest bloomberg business flash. still ahead, rounding out a big week dominated by central banks and trade headlines, we are speaking with david riley, riley, asset bluebay asset management chief investment strategist come on how he is positioning, particularly in his outlook on rates. this is bloomberg. ♪
joining us from the cme is bought by a chino -- is bob iac chino of path trading partners. busy.t has been good morning. the jobs report specifically has been taken two ways, leaning more one-way than the other. the slowdown we are seeing in the hourly work week is a bit troubling. as i learned from taylor riggs this morning when i was watching jonathan ferro's show come of the overnight rates in germany actually all touched negative. that is very troubling to the fed, and become a nation of the wage growth we are starting to see. fed react based off of potential tariffs threats driving inflation? can.ot sure they i still expect another rate cuts, but i'm not sure that this particular jobs numbers gives the markets the comfort they
need to fix this inversion. oil.e: let's talk about we've seen a very volatile week. a barrel of wti up 2.5%. what's in store for next week? speculatives a repricing. speculators were definitely leaning long, worried more about geopolitical and the results of trade. it is obvious at this point that the trade results are more important. citigrouporgan, saying that the demand will actually grow next year. und 40 cap dollars. vonnie: -- around $45. of pathbob iaccino trading partners, thank you for joining us from the cma today -- the cme today. guy: we are playing catch-up all day. now i get a sense we are moving
beyond that. the dax down over 3%, the cac down over 3.5%. lvmh, big china focus, under pressure. iag one of the standout stories. emma chandra bringing us that story a couple of moments ago. we are trading at session lows, and the entire german curve under this zero a little earlier on in the session. that piling pressure on the fed and the ecb. this is bloomberg. the european close is next. ♪
european trading day. from london, i'm guy johnson. vonnie: in new york, i'm vonnie quinn. this is the european close on "bloomberg markets." guy: what a week it has been. european equity markets, the pressure is on. i think we are getting a little beyond that now. we are trading at session lows. cac down over 3.5%, the dax down 3% plus. the german 30 year just beginning to move away from the negative line it hit a little earlier on in the session. we are negative eight basis points, as you can see, so seeing a positive market here today. the entire german curve was negative earlier on in the session. puts pressure on the fed and the ecb, and on a lot of things at the moment. euro swissie also catching a bid today. that is something to pay attention to. the smb is another institution that has pressure piled on it.