Transcripts For BLOOMBERG Countdown 20160126

Im anna edwards. Were getting numbers coming through from phillips. Fourth quarter revenue came in at 71. 4 billion euros. Broadly in line with what the markets were expecting. Growth of 2 . Of course the focus is on the part of the business that philips is going to keep. They tried to sell to a Chinese Business but the u. S. Stopped them from doing that. Who are they talking about to . What kind of price are they looking for . How has that business performed . What can they tell us about the falling apart of that deal . Their ablingte ability of being able to sell that part of the business and the broader lighting section. Market turbulence and how the china theme is playing out. The numbers surprised everybody overnight. Despite all the turbulence and speculation about china, they raised their guidance. They will earn between six and 640. The earnings per share up by 46 . Their orders for at the mobile business doing better. The Energy Business doing better and of course currencies. They seem to have faced adversity in their fiscal First Quarter it would be that last part of 2015. How sustainable are these improvements. And the oil price. Rethinking a rebound. In equities and rethinking that in the oil market. What you have got here is an addition to yesterdays collapse. We dropped by 6 yesterday in w. T. I. Volatility in crude is thighest since 2009. I can tell you this, the highest open interest is in this target here. 25. The betting is by the options where the s is highest trade is 25 on record. The w. T. I. 46 above the 100day average for brent. A lot of interest of course on days where we see money is moving and markets retreating a little bit into safer havens. Lets look at whats happening. Were at 1. 18. 118. The general currently more tight in the global stock market than at any time since it was free floating in 1973. We have talked about retreating of the yen in timors trouble. That makes the bank of japans job a lot harder. U. S. Government bonds have returned 1. 6 . This is the best return since january of last year. Money going into these sovereign bonds. Money in yen and none bonds. Well keep an eye on the ruble. Where we get day the fed delivering the the countdown at the fed. How dovish are they going to be . Good morning. Good morning, anna. Asian stocks have reversed a twoday rebound. Oil is back below 30 a barrel. Ahead of weekly u. S. Government data which is expected to show crude stockpiles expanded for a second week. Prices are now at the highest since 2013. Some bank of japan officials are said to be anticipating a close call at this weeks policying on whether to expand record timulus. The governor kuroda used his trip to davos last week to play down the impact of the turbulence on japans economy. The participants unable to attend in person can take part by a video conference. A Hedge Fund Manager whose chinese stock bets returned more than 6,000 last year said investors should sell their shares asap. His advice now is hold, cash, ait and watch. Thank you very much. Ts get straight to asia David English is standing by. We have reviewed and reflected. It looks like asia is taking these markets lower. Absolutely. It seems to be that two days was really long enough for investors to sell into the rally. We put together a twoday string and it disappeared just like that. That is how asia looks. India and australia. Every Single Market is in the red across asia now. I wish i had something new to say. A lot of it is down to oil prices. Trying to wrap our heads around it. What the tangible net impact would be really on global growth. There is also an element of according to one analyst. Some of the interest in some of these markets has come down. There is an element of that yesterday at the moment, were seeing declines here. I want to single out as well and you guys were just talking about the yield in the 10year treasury. Have a look at whats happening ith the yield in the 10year j. G. B. 1 10 of 199. 22 basis points. There is a lot of risk aversion at the moment. Money going into j. G. B. s and the japanese yen. Down about 3 on the shanghai composite. A fairly large injection of cash from the pboc. 6 billion. Takes it roughly to about 240 billion. They want to keep the money market rates in check for the chinese holiday. Back to you guys. Thank you very much. Lets bring in jane. Great to see you this morning. So much to talk about. Lets start with an asia focus to the conversation. Were seeing the pboc flooding the Financial System in days past and today and leading up to the lunar new year, concerns about liquidity in the system. Are they doing anything unusual this time around given the amount of volatility around the china story . A lot of the activities are unusual. The Market Conditions have been unusual. I think what they are doing in terms of spreading market liquidity, you can say that is normal. There are concerns about the new year. They want to keep things calm. I think really that is at the crux of everything they are doing now, trying to calm conditions. If we look at the amount being moved last year, over the whole of the year, we had about a 6 decline. That compares with double digit declines. Against the dollar. Against the dollar and yet that compares with double digit declines in the rupee, etc. The decline per se wasnt rouge in terms of currency move yfment but look at the market reaction. They are quite aware that even relatively confined movements has the power to create an awful lot of shock waves throughout the market. That is what they are trying to control. Last week we had davos and had a whole lost of voices talking about it. These are amazingly talented people. Do not underestimate what it is. One of the channels, we have the yuan combain. This gain. This talks about the Exchange Rate of the yuan in the bank of japan and the e. C. B. We have a chart tr the yuan. Nominal effective Exchange Rate. They are pushing against it every time the bank of japan has stimulus. They are battling against e. C. B. They are. They are. They have been accused of being an instigator of currency wars. They are late to the party. Really because of the defacto dollar pegged, it has been dragged higher in recent years and that has added to the disinflakes nationry pressures in china. What they would probably like to do this year is correct some of that to allow their effective Exchange Rate to come back. If they manage to do that, which would be by allowing it to weaken against u. S. Dollar and other currencies. What would that lead to capital flows . Jane, stay with us. Well come back with you to discuss it this morning. Lots happening in the Foreign Exchange market. Will stay with us on the program. Lets get to our first interview of the day. We can speak with the companys c. E. O. Who joins us from munich. Great to see you. Great conversation with us last week in davos. Today you raised the guidance. Still the market is going to say look, a huge chunk of change comes from the oil and gas business. Lets go behind that and find out what your view is have we hit peak frenzy in terms of our negative view on cap exin the oil business . Good numbers, by the way. First of all, good morning. Thanks as you have seen the numbers not only in fiscal year one but also in the fiss cal q 4, 2015, we have been off to a good start. S have been up 22 . Our revenues have been up 4 . A stropping achievement. It is different than what the market cease. We have a lot of potential. Ing our program and with that help, we can be pretty confident that we can than anticipated. So we feel good about it. We continue to work hard and we believe that we can do better than what we have said. The upgrades to the bottom line for the e. T. S. , some analysts are raising questions how sustainable that is over the rest of the year. A lot of benefit youre deriving is cutting pension costs. How sustainable is this performance youre alluding to . Well, if we hasnt been confident about what we do, we would not have raised the forecast. At the time, which people obviously think to be a bit early. But you know, we see how we do in our own innovation program. We do see how we go about productivity. Also to see of course there is a lot of headwind out there. More geopolitically than maker economically. We also talk to our customers and we see that a lot of customers would like to work with us. They see that they are making a lot of Good Progress and we can help them improve their business n terms of efficient si. Be a true digital company. That pays off now. As you look into the 22 yearover year, that is by a strong signal that were doing well in the market. Our customers feel good about what we do together. Part of the structure for you, this is the first time you have been able to raise the guidance. Youre buying for just over 1 billion. If we look at the Software Side of your business, it is 3. 7 billion in revenue. Where is that going to be taken to . Are you going to do more deals . If i said to you by 2020, because vision 2020 is how you change the company. Give me a soverpbes what digital sferses and software are going to be in terms of revenue by 2010 2010 . You have quite a cash pile there of 13 billion euros. More buy backs on the cards there . More deals . How are you going to use that cash effectively . It is a good problem to have, to have money on the side. That makes us flexible. It gives us a lot of opportunities to give to our shareholders, whatever we believe is best for the company and the shareholders. Also for society. This is what they are going to do. If i look at 2020, the company, make it more focused in this what we are good at doing and also about creating a system, we call the e. A. D. System. A. D. Were lining our businesses elect fick ain of aches. Electrification. Creating and using the data through Data Analytics and make it meaningful and very fast growing and profitable business growing out of it. It is second to none in the industry. What they actually do is nothing ut making our company digital. It has been one of the most Successful Division also in the ast quarter. The c. E. O. Of siemens, upgrading the numbers for 2016. Lets move on to another corporate report. Philips Beat Estimates for the past quarter and continues to see comparable sales growth in year. Joining us now is the companys c. E. O. Great to see you. Thanks very much for coming to talk to us here at bloomberg. Lets look at the structure of the business. Congratulations on the number which Beat Estimates. But i want to focus on the part of the business you were trying sell to a chinese company. What can you tell us about who is still in the running to buy that company and how much do you hope to get for it . Good questions. Im disappointed that deal with our Chinese Party didnt go through but we have other interested parties that are now knocking on the door and we are engageing with them. It will take some time. I expect that it may take us into the second half of 2016. A the value realization in new deal may be somewhat lower than the original deal. That is as much as i can talk about. You mentioned that we had a good First Quarter. I agree with that. We saw 15 order intake growth in our health care division. Warding. Hat is very re we had big customers from canada and france and grened aa in spain and all signing up for multiyear deals. This is the strategy that we are taking in becoming a Health Tech Company in the driving Better Health outcomes for large populations and i find it very rewarding. The market is going to pick up and focus on the phrase that you just used that the evaluation is going to be lower. I mean krks you guide us in lumileds business. Im not going to that. That is why i branched out from the lumileds question. Im not going to get any further with that, lets move on. Timing is valuable in these enter views. Hy not put lumileds and liting together . Some people asked us that we believe stronger that the upstream component Business Needs to consolidate and it is best done on a standalone basis so we will stick to our strategy to look for buyers for lumileds. We are very successful with our trategy to apply digital and l. E. D. Lighting. With more and more deals smart Street Lighting for example in san jose. We teamed up with erikson to make the street poles smart and allowing radio transmission to come from our lighting poles. This is the integration that customers are looking for. Our l. E. D. Business grew by 26 in the quarter. I think that is a fantastic result which you get by focusing on the application on the end markets. Were not going to recombine lumileds and lighting. When you look at the future of lighting are you leaning more towards the sale which you talked about in the past or an i. P. O. S are tricky because of the Market Conditions. On way are you leaning lighting . We have consistently said that we will look at both and currently we are engage with potential investors. We are getting statements of interest coming through. With the schedule separation. At the same time, we continue full force in preparing for the ideal. You can hear from my enthusiasm that we believe were on the right path with lighting. We saw 150 basis points Operational Results improvement just underlining that not only do we make money with conventional lighting but we can also improve profitability in l. E. D. Many people say l. E. D. Lamps is a tough market but we are showing strong sales growth and Profit Improvement at the same time. I think when the dust settles on the conventional decline, people will see in Philips Lighting a very strong digital Lighting Company in the consumer space in the office space, outdoors in the industries. Flected that is being re in the strong interest that we are getting from potential investors. Lets talk about china. The perennial issue for everybody in three days in davos. It was wall to wall, everybodys perception of china. Give me your take. When was the last time you were there what are you customers telling you . What is the time like . Is it really slowing down . Or how much is it slowing down . Is it slowing down . It is slowing down. I think that is the reality near term. But you know, it is a country with a huge population, with several trends that bode well for our core business in health technology. We know that more hospitals will be built. We know that chronic disease is i understand all of those comments, but the what the market and everybody in the world wants to get a handle on, youre the c. E. O. Of a vast company. Whats happening on the ground in china, succinctly . We had a good rebound in the Fourth Quarter. A strong intake. Good sales growth. But that came on the back of several weaker quarters. I think what we are seeing is a more bumpy road in china where growth is still possible, maybe not every quarter but certainly over one or two years, im optimistic about our opportunities in china. Can i ask you briefly about the u. S. Market . A lot of fixation on the political backdrop in the united. Ates right now obviously health care, you work in a business that crosses that political line sometimes. How are you feeling about what you seeing in the United States at the moment . Im confident about the opportunities in the United States. Plus on the health care side as well as on the consumer and lighting side. In health care, we saw strong order intake grothse at 20 . I think we are leaving behind us the pain from the recovery so that is working well. Large deals. I met last week the c. E. O. Of kaiser nernlta. We are permanenta. We are strongly aligned linking Health Care Providers to Community Health care. Our digital platform is team with a way to connect health care with consumers. Consumer behavior can help lead people to healthier lifestyles. This transformation triggered by in fact care as initiated by president obama is moving in the direction. And i believe we will see a systemic transformation of the Health Care Market in the United States and it is brought on with our strategy where we provide solutions. Thank you so much for joining us. Im sorry to interrupt you there. Joining us live from amsterdam. A quick word on these markets. Speaking of china, you have the composite here down 5. 25 . This is again another plunge for the Chinese Market despite the chinese adding really quite significant capital to the market rate. Liquidity i should say to the marketplace in the overnight market. You seeing the chinese concerned about the shanghai composite down. Lets check in on the commodity space as well. The other key issue has been whats happening with the oil market. Sub 30. Global Commodity Prices are here. Nymex down. Dont forget 25 is where the interest is. Jane is still with us. We heard from Goldman Sachs recently they think investors are allowing the oil prices to dictate too many asset classes. And the equity market too. There is now a very straightforward correlation. You can understand from some equity markets, the correlation. The Lower Oil Price is a generator of growth. Really there is going to be a point where that relationship does flip around, particularly for some equity markets. Good levels of growth should s. E through from oil price i would say perhaps in europe, that was one of the disappointments last year. At the same time, that should come through at some point in the new year. Were watching for it. Stay with us. Up next, it is the road show continuing to pace the details on the deal. They are all coming through slowly, slowly. There you go. The great powers meet, italy and iran. More on these deals and sanctions. When youre on hold, your business is on hold. Thats why comcast business doesnt leave you there. When you call, a Small Business expert will answer you in about 30 seconds. No annoying hold music. Just a real person, real fast. Whenever you need them. So your business can get back to business. Sounds like my rides ready. Dont get stuck on hold. Reach an expert fast. Comcast business. Built for business. Manus it is 6 30 in london. 7 30 in brussels. Asian stocks have reversed a twoday rebound as oil slipped back below 30 a barrel. That is ahead of weekly u. S. Data expected to show stockpiles expanded for a third week. It isanghai come positive down around 5 . Composite is down 5 . Officials expecting a close call at this weeks policy meeting on whether to expand record stimulus. Sluggish wage rises have dimmed the banks outlook. Kuroda played down the impact of recent market turbulence on japans economy. Interest rated policy will proceed as planned today and tomorrow. So far participants unable to aend in person can take part by a video conches. Offices were closed yesterday following a severe winter storm which disrupted travel in the region. Chinas plan to slash crude Steel Production capacity could eliminate 400,000 jobs. That is according to a state run industry consultant. That comes after china announced it would cut production up to 150 million tons without specifying a time frame for the ove. From the bloomberg first word desk. Manus lets get into those markets. We have dropped more than 5 in the shanghai composite. Oil at 30. The markets have huge positions, for put options. Anna the shang zen down the most. 5 danny 9 . 5. 9 . Caroline . Caroline quite phenomenal moves again. Tocks at skyhigh levels volatility up again. We saw the initial rally yesterday phased. Down comes oil. Below 30. 29. 58 if youre looking at brent. It really is showing such similarities when youre looking at world stocks at the moment. This is the allcountry world index versus brent. The correlation seems to be increasing. Such similar trensd when you and at how stocks fall off how oil falls off as well. The correlation of 120 days at the highest level since 2013. This is an interesting one. The correlation between the yen and overall the selloff in oil as well. Youre seeing overall dollaryen tracking the drop in stocks as well. Youre seeing that wrap in with oil as well. We have volatility back manus we have had some of the numbers from the manufacturing giants. We just had a chat with them through philips and siemens. Great interviews. Siemens, europes biggest Industrial Group at the moment really managing to outperform, raising their forecast. You saw them upgrading their overall view. It was for 14 at least. Upgrading their forecast. How long will these positive areas last . The fact that they have a weak euro and are continuing to cut costs and they are seeing lower than expected tax and payments for pensions. Looking at philips, better than expected results. Not so good in they are having to raise their forecasts. Having to ease up with the lighting and units. Sales up 8 . Earnings up 13 . Well have to see how the spinoff and the focus on medical philip. Tinues to go for anna the first stop of a dealmaking tour around europe. Manus yes. Press conferences. The photo graphic moments, they are all there. During the visit to praise the nuclear deal that has been seen by the sanctions on iran lifted. The nuclear deal could stand as an example for problem resolution. The question of security for our region cant be resolved with military solutions. We need to work through the political channels and for this, we have to work together. Iran and the european union, particularly italy. We are ready to work together. This trip could not only reinforce our bilateral relations but also help to find peace for our region and the world. That is our mission. Anna Ryan Chilcote is following the story for us. Good morning. Tell us about the deal and what this means for oil. Ryan there were an awful lot of deals, part of that 20 billion euros for natural gas and talk about purchasing aircraft in iran. Think the big accent here has to be on oil. All you have to do is look at the fact that the iranian president sat down for incident we are the c. E. O. Keep in mind iran has the worlds fourth largest reserves. This is an untapped country. I caught one the c. E. O. Before he headed to that incident we are the iranian president. Capex cuts about 15 this year in europe are really going to hurt the big oil companies. Listen. We remain on the same level as last year. Cuts between 15 and 20 . That is going to affect deeply our future. Longterm cycle, the production, if you want to of course you have to cut. That is what is industry is doing. Ryan it is not just about iran. G into it is about buying iranian crude. It is what they are discussing with the iranians. The greeks got in on the act last week. Obviously the italians looking to follow suit. Manus iran is looking to reenter the national market. The fellow oil rich nation, libya, they are slipping away. Ryan that is right, ma us in. People surprised, surprising everyone by establishing peace and producing than they are now. I was speaking with the head of their national oil company. They are on the verge of becoming a failed state. They lost 60 billion he reckons o their civil war and they are going after infrastructure and exploiting the differences between the two sides in the civil war in the west and the east. Have a listen. Reducing effect on of answer production . Of an effect . Years ago before ryan cron libya produced just over 1. 5 billion under gaddafi. Now the head of the n. O. C. Said they could double that if they could have a couple of days of peace to about 700,000. Back to you. Manus thank you very much. Ryan chilcote with what is going on in the oil market. Great to see you here in the studio. Lets come to you on the subject of oil. It seems to be as we heard from Goldman Sachs, too many asset classes. How much does everything come down to oil prices at the moment . I dont think it does come to the oil price. We have seen iran come to market, probably surprised everybody by how quickly they have done it. We have ian iraq production go up as well. It is actually all about the u. S. Dollar and oil itself. We have seen significant u. S. Dollar strength has driven oil low. You are talking about 20 a barrel for oil. It is on the back of a much stronger u. S. Dollar which is significantly overvalued at the oment. Manus jane, lets bring you in. The Federal Reserve raised the Interest Rate by. 25 . Many would argue that janet yellen is losing that game. This dollar is continuing to rally. Jane the markets expecting they could ease again. The e. C. B. In march. Bank of japan, another sbeck speculation they could ease. We have australia later in a couple of weeks. They could all ease again. This is falling to china. If china were if they believe that china were to allow it to deappreciate then it means the china in the currency war, all banks have an incentive to ease further to prolong their easing cycles. The dollar could go up by default. That of course puts the ball in the u. S. Court. They could say look at u. S. Inflation indicators. They have done the heavy lifting. Lets talk about some of those currencies that are very much linked. Where are we seeing this big volatility coming through . Manus your wcrf function. Look at that. The ruble. 30 . The rand, 21 . You go into those direct correlations. Ironically, look. . Anna that was your point earlier. Very small moves in the chinese currency can have greater impacts on markets. Jane if you look at the currencies at the top of that chart. Look at russia, africa, brazil. S are not playing the currency war. You want low inflation. Thats why you try to get your currency lower. These are on the dark side if you like, of the currency war. They have weaker currencies which has brought in too much inflation. Stagflation. Hat is a horrible situation. Will they hike Interest Rates . Not a nice outlook for them. Manus if we go back to the perennial con none drum which is if we all have this much more money in our pockets en, when are we actually going to spend it because the u. S. Consumer is faultering. There have been little cracks in terms of optimism. How do you look at it in terms of this great boon that were boom that were supposed to have for oil . Er is more the consume focused on unemployment and job security which is slowly improving. This is very much a positive for the marketplace. If you start to see good earnings numbers as well, that inspires confidence in the s. Nings number really driven by growth and cost cutting. That tends to improve sentiment. Oil will have an impact but it will be quite marginal very early on. We have seen a very quick move over a short period of time. Anna january was a pleasant experience. Hold on to your chair ride kind of experience. It was incredible wsm we have een the v. I. X. Index up. I read this morning, the feds are pulling mount of perhaps suggesting that investors are looking for something calmer, that Central Banks will come to rescue. I think we are in far calmer february and march. When you have volatility as high as we have seen it in january, you sit and watch. This is not a time to buy or sell. You find the major participant in the marketplace, when the v. I. S. Is in excess of 30, it is fast money, trading money, we are in the business of investing for longterm. Do not participate. Just ate wait and see what happens just wait and see hat happens. Anna thank you very much. Ours are staying with us on the program. Manus up next, as the east coast thaws, will the fed freeze . Will the fed freeze . We look to the day ahead. One day out from the fomcs Rate Decision meeting. Anna welcome back. 6 48 in london performed quick word whats happening in the equity session in asia. Were seeing significant weakness in the Chinese Market in particular. You can see that the shanghai composite now down more than 6 . The risk to the china rating has increased on the growth outlook. Manus china life is one of the big movers on the shanghai come positive its. The lowest since july of last year. Lets check in on u. S. Equity futures. The dow down. 4 . S p down. 4 . You are seeing the u. S. Equity futures go lower. London, the only ones open at the moment are of course here in london. Down by 1. 08 at the moment in ondon. Philips reported estimated profit in the Fourth Quarter as demand for medical gear if the u. S. And china increased. 742 million euros. The Company Last Week canceled a sale of its lighting components unit after opposition from a u. S. Reck regulator. The separation of that business remains on track. Siemens has raised it outlook for the full year. They are confident they can ride out a slowdown in china and a sharp drop in oil prices. They have been helped by lower than expected tax and pension payments. It is the first time their c. E. O. Has raised the outlook since he was promoted from finance chief in august 2013. A jpmorgan unit will pay to resolve claims it took advantage of its status as Lehman Brothers ried to unfairly extract cash. S two of ment involve the three major piece s of litigation jpmorgan left over from the 2008 bankruptcy. That is your Bloomberg Business flash. Manus thank you very much. Today marks the start of the feds twoday policy meeting. No action is expected this month. It is all about the volatile philadelphia that is plaguing the markets. Anna the chances of hikes from less deral reserve seem likely. At the World Economic forum in davos, we asked our top guest what is they expects. If you mean cut rates, i would be stunned. Stunned . Stunned. I would be very surprised if crease. An in i think potentially they tighten once more this year. But im not a believer that they tighten four for times. March is off the table. April is shaky. Maybe by june. I think the forward market was way too worried about fed action. The fed probably made a mistake in september. Growth has disappointed. Going to go lower rather than higher. I think it was necessary for the fed to do. The feesd credibility in some ways was on the line. If they didnt do it then the feds credibility was in some ways on the line. If they didnt do it then, when would they . She has laid it out very clearly, unemployment continuing to maintain these levels. We may have a full handle on unemployment. That is extraordinary. Were not talking about that. Also inflation to get to 2 with those lower rates. Anus janet yellen had a bad case of insomnia last week. Two people who can make soverpbes whether she got the message. The whole world seems convinced. What an effort to get off the bonds, 25 basis points. Dont raise rates any further. Jane i think they backed themselvess into a corner. It was something they had to do. You have the minutes. It suggests it was a close call. Since then we have had a variety of fomc members. There is still moderate inflation in europe. The dollar has strengthened and done a lot of heavy lifting. I think really from n economic terms they didnt need to hike in december. They did it for credibility reasons. To hike again this year . Maybe not. Will they . Maybe not. Anna you dont think four, three, two, one. I dont think two or one. The first rate hike we got was a signal to the market that quantitative easing there is no reason for it to have been done for an economic perspective. Were expecting no rate hikes in 2016. You will end up with u. S. Dollar weakness. You already have the dollar 20 overvalued ver u. S. Is the euro. The dollar can only go in one direction from here which is generally weaker because of Interest Rate expectations. Further hikes in the u. S. Seem unlikely. That was echoed in davos. Manus any question to you, if i looked a 10year Government Bond yields, trading lower. We lost another 1 10 of 1 . There you go. Is it boring . The bonds delivered a moderately good return for january. Are you considering bond also in the portfolio . You just always have Bond Exposure in your portfolio. It is an insurance policy when things go horribly wrong. As we have seen in january. Bonds have performed well. But they are incredibly expensive at the moment ands unclear about whether Interest Rates are going to go up or down. You have to keep that in the back of your mind as well. The reality is look at bond yields relative to the yield you get on cash in a bank. They often carry over cash at the moment. That is the way longterm investors are looking at Bond Exposure. Anna we had one of the comments about the fed in december talking about credibility, how credibility was on the line. That has been said many times. Mario draghi said, he is mentioning this word in relation to what they are able to deliver on inflation. He says that their credibility is really on the line. Meeting our objective is about credibility. If a central bank sets an objective , it cant just move the goal post when it misses it. What does that tell us about march 10 . Jane i think he is very clear. There is a strong possibility that he will ease again. Anna he or they . Jane that was the interesting thing. We knew december he didnt have the unanimous decision. He didnt have the whole of the committee behind him. Which is why the market didnt react in the way that perhaps he had hoped in december because the market began to think, we havent got a unanimous decision behind it. The committee doesnt all want to ease again. Maybe therefore he is going to be prevented in some way from easing again. He comes on next week on the news wires extremely dovish. We have misses on the eurozone inflation. Oil prices are lower. One real problem in terms of the oil price and central bearnings is inflation expectations. If people keep thinking inflation is going to remain low. That is a big issue. Manus lets bring you back in. Rom the investment perspective the cavalry were coming last thursday and friday. These markets flew. They literally spun oufert control in terms of a rally. You could not get enough stuff in your bag before the close of business. Does that change how you look at Equity Investment . Not at all. That is based on oversold markets and earnings that drive share price appreciation. Not sentiment. Not geopolitical events. Look at where the markets are. Anna thank you very much. Stay with us. Stu for spending the last hour with us. Up next, well talk about. Asyjet manus were going to break their numbers down. That is where the inflation is going to come in. Easyjet numbers top of the next hour. Bend me shape me, any way you want me as long as you love me, its alright bend me shape me, any way you want me youve got the power, to turn on the light shape the best sleep of your life. Sleep number beds with Sleepiq Technology adjust any way you want it. The bed that moves you. Only at a sleep number store. Rethinking the rebind, a twoday rally is caught dying as stocks in asia selloff. Oil tumbles below 30 a barrel. Saving face. Mario says credibility is at stake. The feds begin its meetings with investors dousing a fourhike 2016. Recent terror attacks affect asyjets results. Easyjets results. Welcome to countdown. Anna time for some news. Today we have numbers out of easyjet. Theyre giving us, first off their view on their pretax forecast in the air. It remains in line with the market. The overall message is one of no change in terms of their expectations. First quarter passengers carried. 1 . Waiting for more details on the probability of the business because of course Big Questions around how this industry is benefiting from the oil price. The oil price, how much does that benefit been hedged away . And how much has that benefit theyre passing straight to consumers an theyre experiencing it to the full extent themselves. Easyjet said they are passing these drops on to consumers. First quarter total revenues come at 930 million pounds. Theyre saying that their cost per seat decreased by 3. 7 . Well keep an eye on all of his. Manus the shanghai composite over 6 that has set the tone. Weve got european rally indicated low. Off by 70 . The dax, 95, 98. So we are seing this aggressive move or it has come under pressure again. Crude volatility has come back since 2009. Take a look at the bottom of your screen. Youve got crude trading at 2. 8 . Down. Rt of the day is happened in manus 1973. I ran the story. I did. Anna weve got risk aversion hase going on in the mark. Lets get to caroline. Oil slipped 30 a barrel. They expected to show crude ockpile expanded for a third week. The shanghai composite is down 6 . And its now at its highest since 2013. Me bank of japan officials discuss on whether to expand. Effect to r used his play down the impact on japans economy. Meanwhile the Federal Reserve says its meeting to decide the Interest Rate policy will proceed as planned today and tomorrow. Theyre unable to attend in erson. The federal government was closed yesterday with the disrupted travel in the region. Hinas plan to disrupt Steel Production may fuel social instability. The warning come after chinas council announced it would cut roduction. Global news, 24 hours a day. More than 100 leads around the ord. Manus caroline thank you very much. Lets bring yrks ogi dejuan back into the conversation. Capacity rising from cost on to the demise. Just looking back probably the group of Industry Leaders in 2015. Traveling ledger was one of the best performing one of the best performing groups on the stock 600. Easyjet wasnt there in terms of their performance. But this whole sector. Its a very expensive perspective. We seen kind significant sterling weakness. Course, the fear is further terrorist attacks. How ur point its ok about hard they have. And then they talk about how their Second Quarter revenue is down. Down mid single digit across the Foreign Exchange due to egypt. Due to paris. And yet were searching around for these opportunities which counter the weakness in the oil price and counter taking money away from their oilrelated bet and put it somewhere else. This has got to be an industry that benefits. Hetching is distracting that some players implement and some dont. You would like to think that they will benefit this industry more son so than others and it should spill through into their earnings numbers. They had 8. 1 growth. Thats a really impressive number and very good to see in this environment. One name that caught my eye this morning were talk about starting. Were talk about the guilt. The market is setting itself up today for potentially whats called a fail option. Theres not enough to demand for british Government Bonds. , are you trimming back . Are you saying that . The reality of the situation is its extremely unlikely. And the market expects that. Youll see market volatile till as well. But actually we just a just saw that as a buying opportunity. Valuations in the u. K. Look reasonable. That is also a positive as well. The markets swat down 5 sprs to 5 1 2 . Theyre doing 78 . So the u. K. In terms of the commodity and in terms of the mining. Absolutely. Programs it will be more pain to phenomenon they should say stay away from cats or scotland exposure. But oddly on the polling, therefore its a vinyl you cannot get domestic u. K. The biggest area. So to actually get domestic explow sure, they do it through the markets. 51250. Thank you. Lets check in on the asian market. Its sounded buy prends. Theyve been tracking him. And its broader than that in the session. Absolutely, i think whats been happening in the Chinese Market we just closed off shop there. Happened in the last 30 minutes or so when things really went from bad to worse. We started the day and everything went quiet. Equities are down. The damage on the regional. 7 . Arks about 1. 6 , 1 during our time here. You j. J. B. Aapproaching that record low so thats how he looked look. I was just doing some rough brush on my head and just before e went to the error. You put the damage. I was just wiped out. Roughly to the about 290 u. S. Dollars. We are approaching chinese new year. They had a system to keep money market rates steady. They will quit a team. Holland so there is some concern there. Theres the outflow. They came up with an timent of just how much money flowed out out of the chinese economy. One one trillion dollars are deepings. Theres not a lot of good news. Weve hat 167 trading days i believe so far. Only four of them have been in clear. The rest look like this. Anna they say investors should sell their stock in china. So far this important. His advice now . It holds cash. Lets get some final stares. And joe macky last week. And they wrote up another story saying coming back. O the damage isnt done yet. I think marcus is yor sold. This is a time to study comp. Were looking the china story we say its positive. China is a domestic story. Its not sloge down. Its not melting down. E reason with 12 p. A. s ive een a lot of that. There was an inclusion into the it. M. F. Basket. Ive had issuances in europe. They implement the exchange connect. And vice versa. These are all very positive steps to a domestic economy that will slowly but surely improve. Theyre learning and theyll learn quickly. You see that as a short term teething trouble for you for the chineseer quity market. They have direct exposure or do pry. Et it some other you must have exposure to china n any balance. Were talking about a flrs 10 billion economy. Remember the u. S. Was to serve and put it in connection. The u. S. Is you just under three in a row. Can keep that exposure. And if you did it on a g. D. P. Basis, exposure will be much higher than portfolios held across the board. One of the discussions i had is through the currency but into russia. Inexplicably the correlation between the oil and that is pretty darn high. But it looks like were going to ve another rough ride on the root. They have a Central Bank Meetings this week. Would you take exposure if you would to have safety in the bricks. Where would you like to get some exposure. We like china for the reasons that we mentioned. We like india because of the surface they have surred. Remember hes going to follow him and going forward. Then you have to become more constructive. You have to become more destruct i in general. Ask for russia. Its very difficult to get the box. Im desperate to find one. We like russia. Based on valuations. The reality to the situation is unbelieve situation. They just let it go. They probably a good things. And there will be an exposure to russia. When europe starts to improve as well. Anna shes been feeling some of analyzing some of the stocks. We report live from one of the tech conferences. Were talking about cyber security. 7 13 in london. There it is waking up in london this tuesday morning. It is 8 17. This is the picture that were expecting to develop across the europeaner quity market. Down by 1. 2 . The handover has come from the composite. Zen down as well. Manus were only 1 in london. Take your eyes to the top of the screen. S. Er quity futures down by 6. 42 . The s p 500 down 7 . The earnings ratio is the lowest 25year average. Money coming ott of the oil complex as well. Weve got oil. Again, the big focus is the 25 put option there. You go. Move on the llar move. Our side of the day on yen 81. 88. Nna caroline has the details. Caroline and better than expected profit. The earnings worth 14 million euros. He remains upbeat despite weakness in china. We had a very good rebound in the Fourth Quarter. The strong order intake and good sales gross. Of hat came in the back that. Youre seeing a bumpy growth where growth is not possible. Certainly over one or two year. Im optimistic about our opportunities in china. Anna easyjet has missed First Quarter revenue estimates. Our sales were down and affected by the down passenger jet in egypt. Siemens has raised its property but for the whole year. It can ride out a slowdown in china and in oil prices. The cre oh told bloomberg that although the business is facing challenges, its having good headway. More here politically. We also talk to our customers and we see that a lot of customers would like to work with us. Ey see, that we could help them. Improve the business. File an extension by the efficiency. And be through a difficult company. Thank you very much. You probably thought about your computer being hacked. Maybe even your mobile phone. That makes it click. People dont select. Hes probably got a car in tel aviv. Good morning, el yod. C. E. O. Costar which specialize in karl hackin. First of all, we saw last year the jeep being hacked. They were able to consider the airconditioning. How easy is it, the hackers to hack a cub . I wouldnt say that its something that i can fit in. It happened during growing. Chinaead coach so g. M. Or or certainly something that you can be aware. Cyber hackers are getting more and inner excited about the world of our cars which usually wasnt even connected to this as well. Theres something that gets me more and more precipitation. Its quite clear. How do you stop hackers from hacking cars . They thought about cars. Can we all agree how are we going to get the hat . Thats a really good point because certainly for florida and for the stagger company. I pushed it four is it. Were the most important thing. As the stick approach toer understand it. The vehicles are getting more and more connected by different area. They will have a cinematic setting. Were in gem. And the price could not connect the drive. S that the same, i think some of the concepts of similar was there a lot of different things. Were talk about completely different propo calls. The columbine which is different. So the challenge n terms of on cancel for me. We have a very big slip. Its god one piece they usual sli pretty much only wy five which is is the main interest. So we have funny during her morning pressure. Many different attacks. There must be something in our quarter. Well meet you on the wiggest side. Tell me whats blind that deal. Whats checkpoint bring to august check its a part shership. Sbn. Every Network Activity will go there. And to. And its stocked to a critical mission. While checkpoints are sablet n you crant. Never itching that you guys. And well not mutt you into the same car. Sheer. I think 13 million. Why dont i just buy you instead of signing up with them. Thiss a question that i much thank you very for joining us this morning. We will talk to c. E. O. Of the ny sus security. Theyre going to help keep them out. We look forward to it. Lets just tell you what it is it is. She will lost against the dollar that we saw previously on the session. Looks dra madic. Some of the flavors and some of them are commentators. Couldnt be possibly by his on widge. You let. It theres a real shift that rally has broken are for feds woday meeting begins in 2008. Mark carney will testify to parliament on. And then this afternoon well. Et to peermy day sha and so were going to get those earnings. Theyre going to break this evening. Yeah, absolutely. 7 26 here was ricks. That will do it for us here on countdown. We leave you with the on the move team. The only way to get better is to challenge yourself, and thats what were doing at xfinity. We are challenging ourselves to improve every aspect of your experience. And this includes our commitment to being on time. Every time. Thats why if were ever late for an appointment, well credit your account 20. Its our promise to you. Were doing everything we can to give you the best experience possible. Because we should fit into your life. Not the other way around. Welcome to on the move. 7 30 in london. 8 30 in frankfurt and paris. Im guy johnson alongside jonathan ferro. Jon, what a morning. Asian stocks fly. The shanghai plunge over 6 and crude tumble to 35 bucks a barrel. The Central Bank Must fulfill its inflation mandate. Its credibility is on the line. Tapped Federal Reserve holds its first meeting of the year when they take a hike off the table