Welcome to bloomberg daybreak europe. Manus we have a stacked lineup for you, a little bit of a nordic flavor and will kick it off. Anna nordic numbers coming through, the bank in stockholm sweden, and theyre waiting with the head or decision. More on that in just a moment. Well get to the secondquarter ofbers, above estimates 18. 8 . The Net Interest Income 1. 18 billion, below the estimate of 1. 21. This,ne was looking for will the domicile stay or go . They now say they will make the final decision in september about the domicile. Now saying it will be a little later. That sweden considered they will consider joint banking unit. Copenhagen also tutoring joining the Banking Union. Finish be a danish or destination . Us in about 15n minutes time. With battling it out oracle and elsewhere. 500 Million Euros is what youre getting with the Share Buyback. Forecast,f revenue they are raising the overall revenue forecast based on the foritional, the full year operating profit will be between six point 8 exploit 87,000,000,000 euros. You get a guidance which is uplifted and the backdrop to this, the balance between bring in on the cloud business. And to what extent the euro, and we will talk about this through the next hour and a half, the noneuro revenue business is only 55 of the business. To what extent is the ceo concerned about the value of the euro . You will have that conversation at 11 30 a. M. U. K. Time. Anna lets get to the risk radar in the asian session. Asian stocks up for the night day, all eyes on u. S. Stocks read no change in the doj, which is seen as broadlys 40. We put the aussie dollar in as well. We had seen us urge earlier on on the jobs were for but then it retreated a little bit away from that. Manus and the eurodollar just off highest levels. Its how much is invested in todays News Conference with mario draghi. The market is net long for the first time in three years. Speculators, if you dont get a older locks scenario, does he stay a little bit hawkish to keep september and play . Could see the market cascade back down. All eyes and years on mario draghi today. Anna secondquarter net income coming in below estimates. Lets get the bloomberg first word news with Juliette Saly. Donald trump associate republicans they should stay in washington until they repeal obamacare. The move sparked renewed negotiations todays after efforts to enact a new Health Care Law collapsed. A group of about 20 senators met last night to hash out possible steps forward, including a measure proposed by mitch mcconnell. U. S. Senator john mccain has been diagnosed with the type of rain cancer that was discovered when doctors remove a blood clot above his left eye. Glioblastomad a and he has been recuperating at home since the procedure to President Trump said his halted prayers are with mccain what president obama said he is an american hero. President trump has said that he would not have appointed attorney general Jeff Sessions if he had known that sessions would recuse himself from overseeing the Russian Election meddling investigation. He called the decision very unfair to the president. In interview with the new york times, trump accused Robert Mueller of running an office rife with conflicts of interest. China has agreed with the u. S. To start constructive cooperation to narrow its trade deficit. The statement from the Chinese Foreign ministry came after highlevel negotiations yesterday with the worlds two biggest economies unable to produce a joint tenant. The talks got off to a tense start as wilbur ross upgraded china over trade imbalance in both governments canceled their Closing Press conferences. The french finance minister has said the u. K. Must per estimate to the repayment of funds it does to the european union, citing 100 billion euros. Said we want our money back. He added that talks on the refund less form the basis of brexit negotiations. Global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. Stories on there bloomberg at top. The rally continues on low levels of volatility in asia. Asian stocks up for the night consecutive session. We are seeing the msci asia the index at a level weve not seen since 2007. Cap ask of japan stood expected. The asx 200 looking at a good as well although the aussie dollar has clawed back a little as well. Unemployment picking up slightly to 5. 6 . Watching,tocks are still a lot of focus on the deal out of hong kong. Deal. Partner joined the Morgan Stanley saying the injection is very positive. Its up almost 16 . The Energy Producer looking good, the biggest jump in seven months on the upgraded output. Some weakness in some of the korean stop. On lcd panelnote prices coming under little bit of russia. The aussie dollar retreating, have a look at this chart. The aussie dollar trade weighted index remaining stubbornly high. It has risen 6. 5 since the start of june. Weve heard from the hsbc economist saying the Interest Rate hike usually as about 5 to the currency. Cash rate which is at a record low of 1. 5. But the stubbornly high aussie dollar creating headaches for the rba but not able to through the benchmark today. Manus thank you very much. Took no stepspan to dial back there aggressive monetary Stimulus Program even as the other banks around the world are looking for the exit. Anna it didnt acknowledge it was too optimistic on the 2 inflation target. Us tokyo. Ays joins very good to see you. They did it for the sixth time, so im not sure anyone was apprised. Someone say theyre more realistic on inflation. Maybe not yet realistic enough. What did the boj say today . Japan kept all of its policy tools in place, paddle to the metal on stimulus, unlike other Central Banks. You still insist it will hit the inflation target even if it takes longer than they would. As the date for when that will 2 target for the fiscal year starting in 2019, no sopranos just thought they would wait. Its a delicate issue for the bank of japan, finally acknowledging it will take longer. 1. 4 makes theom optimistic on growth. They see the economy expanding modest modestly. , they have to do that to buy the bonds to keep the 10 year note yield a zero. ,any people telling us today bank of japan officials and others, that even this is still optimistic. Lets listen to it former bank of japan member. Lets they have become a littt more realistic. Today i think the boj [indiscernible] is still we think that this unrealistic. The bank ofe sure japan governor will be peppered with all kinds of questions along these lines, are you still optimistic when the target is 2 and inflation is zero point do were. 4 0. 4 . Manus thank you very much, Kathleen Hays in tokyo. Lets get to our guest, chief economist at japans macro advisers. Thank you so much for joining us this morning. Target,in the inflation probably until march 2019. What does that do to the credibility . Time he would delay and extend and pretend. What do you make of this extension . I guess he must be regretting that he made the promise of a 2 inflation target in two years time. Having said that, the last four years, do believe the japanese economy is growing strong. There is a labor shortage everywhere. I have a sympathy to the governor on this point. Anna you point to the upside, but lets focus on the thing he has promised to achieve and has struggled to come and that is around inflation. What is the risk with the current strategy that after he starts to heaven adverse impact on the Government Bond market, that he is forced to change his policy . Right. There are a number of areas. Its pretty bad timing. I think it would be best if the government delayed it again. Another more important risk is ministerlity of prime abe. The Prime Minister and the government have been strongly backing the aggressive stance on inflation. But there goes the support for bank of japan. I think without the strong backing up the government, the bank of the payment start to feel it cannot maintain the current aggressive stance. That is the biggest risk. Manus theres another element of risk, the bank of japan may materially entry into the market just 10 days ago. It struck down on the tenure governor boniors of the market and went up the belly of the curve. Sending af japan is clear message, they are absolutely focused on the. 1 in terms of yields. Is at risk, giving the shifting global rate environment . Its absolutely the opposite. Its a great opportunity for boj. That betweenrate the yen and dollar euro will benefit the bank of japan because the yen will be obviously weakening. We could see reemergence of a carry trade for the Global Investor borrowing in and investing in interest yielding currencies here that could weaken the yen and get inflation. Thats also for the japanese stock market. Boj being the only central bank to keep one dated easing, that is a great opportunity for the bank of japan. Anna the other thing they are buying is etfs. With the booing see weve seen in global stock, a difficult is it becoming to explain the involvement of the central bank in the japanese stock market . I think the stance of bank of japan is very clear that buying thek is a part of conference of effort to raise the price. The more the bank of japan buys anything, the price should go up. We should take the stop per is purchases part of the company to plan for boj to keep printing notes and stock is just one of them. Manus lets go back to the dollar in come the possibility of another carry trade reemerging. If i look at the dollar weakness, is the yen risk that donald trump does not deliver ay second half of the year on fiscal plan and the dollar remains under pressure . That is the real risk, or part of the risk, isnt it . Takuji i wouldnt say that. Riskarry trade could cause if it becomes excessive too fast. But the bank of japans primary is to get things that are not above anything. Its great opportunity to let the end we can. Government can defend against other policymakers that they are doing Monetary Policy. I dont think it is a risk for the boj. I would emphasize its one of the last opportunities for the bank of japan to reflect the japanese economy in the next three years. Anna and you think it is still possible with the current plan . Estimate that the boj keeps pushing out further into the future, theyve moved the target six times in terms of when it will achieve it. I do you look at their inflation targets . But they are realistic estimate of where they think inflation will the or is it just a means to increase expectations in the market . Takuji i think it is becoming realistic. Yearsis given itself two to let the economy grow and let the inflation rise. Inflation, i2 think it is realistic. I do think you made a big 2 take 2013 to use the word in two years. I think that was unrealistic and as imply, it does hurt the credibility of the bank of japan. This. Balancing act is the growth story and the political story, you mentioned abe and the growth trajectory from the bank of japan. Is the economics at risk or could it materially change if there is a new Prime Minister . It depends on the next new Prime Minister. The common nation of expansion is structural reform, this standard Economic Policy to get any economy out of deflation. If we get a sensible Prime Minister, they will listen to economist, i hope, and when they choose the correct policy, i. Hink it will be very similar we will see it they are listening to the economists out there. Coming up on the program. Manus we havent earnings piece for you. We will speak to a ceo who gives us his first thoughts on the day. Thats coming up. This is bloomberg. Anna welcome back to bloomberg daybreak europe. To scandinavia. The bank missing the lowest analyst estimates. Casper joins us now from hong kong in his first interview of the day. A very good morning to you. We will start with a decision about the headquarters of the business and whether you decide to move that. Give us a bit more insight into what you will be considering in september. We understand that neither denmark or sweden will have made a Firm Decision by september. How are you able to say that will come in timber . Casper will come in september . Casper we decided to not make the decision yesterday. In anot a simple decision think we are getting ready to make that decision. It is an important thing. Bank andmultinational the four markets are all part of the single market. And fairredictable regulatory environment. Importantg union is element here and we need to assess that. Anna if the decision by the danish and swedish government is that you dont know the interest of timber, i guess your by september, i guess your takuji i think weve come far no to make that decision. Think its right to take these extra few months and then make a decision but i think we are ready to make the decision in early september. Manus when you see what happened in spain and italy in the debateesolution, of issues in the spirit of the law and the actual law, the risk of a nordic lindner becoming part of the banking unit, does that fit comfortably with you . I think when you look at the spanish case, i think that was handle in line with the new regime that is put in place. About bailoutst but theyll ins. When we go forward, it is important to have a level Playing Field for everybody is think thisd i provides a. Manus theres a proposition out there that you are thinking about this. Critics would say you are andntially hedging yourself using your weight and heft to extract perhaps better terms in the best possible deal. Thats potentially what your critics and some people would say. How do you relate to the charges from your critics that youre just swinging around your size and scale you are arbitrage . Casper im calling for a level Playing Field and being treated the same as my european peers. Im calling for everyone to be treated the same and not arbitrage. That is both an assumption in accusation which is plain wrong. Anna on the subject of the headquarters, we talked about the banking unit and that is clearly part of the story. What else do you see need to see movement on to convince you to stay in sweden . Casper i dont want to start speculating on what will happen between now and then. We have come a long way in our assessment and im confident we are in a position to make that final decision in september. Manus lets get to the nittygritty of the business. The headline is you missed the lowest estimate, 700 40 million. The numbers, the market will question the numbers. Give us a sense of what is going on behind the business. I should we interpret this . Casper we had a stable or in the second order it would not our best order. There are some specific Second Quarter issues there but we are in line with us year. When we look at the first half of this year we are ahead of last year but percent. We have a Strong Commission line and what is characterizing the order is our cause. We predicted we would have high costs in the second order in the first half of 2017. So that actually comes as planned. The reason is going through a tremendous transformation program. We have always said that. Cause scorethe coming down in the second half of 2017 and we still maintain that is what is highlighted second order, according to what we had expected as well. The you had talked about need for investment, tell me about the margins you are able to generate at the moment and how the competitive it environment influences those margins. Is there less competition out there at the moment . Casper our lending margins have been stable. On our deposit margins, that is also positive, so we both and it will hold those margin and they have been improving. Of course we will work hard to continue that trend. Outlookn terms of the for the economy, looking at some of the gdp has, we seem to have turned a little bit of a corner there. Give us your assessment of the economy terms of what is going on, how is the corporate environment . Give me your perspective. Inper for the first time six or seven years that ive been with the bank, the ceo more aligned, synchronized picture in the nordic region, growing in a healthy way. It is not really been seen yet in loan demand, but overall, the economic backdrop for the future foreseeable future is expect that i would to also be seen in the business down the road. Anna thank you for your time and we look forward to speaking to you in september orbit for. Thank you very much, the first interview of the day. Early or ar too glass of cognac. They are confirming their guidance. Cointreau confirms their 8 dance saying sales rose beating the street. They are confirming the fullyear outlook. Montreal is mad. Anna we have a read headlines crossing the bloomberg about for your net profit and the estimates for that. Originally it was 1719,000,000,000 dollars coming in, they raised their fullyear outlook. Theres a number of warnings out there from the central bank, so to speak. Are you seeing what is going on . They see positive development and horizon lending. Fixed income commodities in currencies was a key area. 5. 60 9 billion is a little bit below the estimate we have out billion. Ch was 5. 70 5 they have done incredibly well. He spoke to the ceo last time around and said they are the power health terms of fixed income commodities. We will have another conversation with the ceo joins us, total income of 11. 74. From the numbers french advertising giant under a new ceo at his business. Organic growth coming in again sent estimate of. 5 . Commentary about the rest of year coming from the ceo, he says it is too soon to speak about 2018 targets. He said that the ceo specs improvement in organic growth to continue in the third order. Last month he succeeded worries levy maurice levy and made it into the world are you advertising agency. 45 minutes of conversation, they will announce the Monetary Policy decision. Caroline, our reporter in frankfurt. Thank you for joining us. , heook three weeks ago lit a torch paper of written in the bond market. Is today going to be as exciting . You have to bring goldilocks to a News Conference like this, not too hot, not too cold. The answer to what everyone is looking for is what will happen to the Bond Buying Program after december. I dont think we will get an answer on that today you are into are certainly of economist. The earliest point or they would make a formal announcement is in september or later. So looking forward to the fault. In the background we reported that the ecb staff is looking into options for what they might do in the future. Taper, will they reduce one step at a time . At the moment, we will not it an answer on that every we expect it to be a white meeting. Meeting. A quiet at the last meeting in june, the ecb did discuss removing the language in its Monetary Policy statement on qe. They currently pledge to increase the program if necessary. Economists are split as to whether that might happen this time. It is an option, but as you said, policymakers may choose to be cautious this time around, but there is always a risk conference which we look forward to and you might drop some hints as to what kinds of discussions the governing counselor has. Is there anything in the News Conference you think you might go for as a surprise . It is a balancing act. Will be dancing on the head of the 10. Job fornot an easy mario draghi. He has to manage to sound optimistic on the economy and at the same time, not sound like hes going to be too hasty about reducing qe. Something that could come out in the press conference, if they say that actually started discussing how they might end qe, that would be news. So for they been saying they havent had the discussion yet. Side on theobably side of caution and not try to shop the markets too much. Will bring you all the time,s at 12 45 p. M. U. K. Followed 45 minutes later by Mario DraghisNews Conference. Manus lets turn our attention to china. There has in an agreement to narrow the trade deficit. The statement came after highlevel negotiations broke up yesterday with the worlds two biggest economies unable to produce a joint statement. Anna lets bring in malcolm scott. Good to have you on the program. There were some they comments from both sides but still no joint statement, the fact that we got this announcement from the chinese just a few hours ago, some of where we are on this. Leading into the talks, treasury secretary nugent said they wanted concrete steps from the chinese. The commerce secretary opened the remarks with some browbeating of the chinese, talking about the need to address the surplus. It wasnt the greatest way to set the tone of these. Youally on these dialogues aim for a joint segment and a joint press conference. The press conference was scrapped and no joint statement came. We have these rather vanilla statements, one from the u. S. Side and one from the chinese. The u. S. One talks about acknowledging the shared objective to reduce the trade deficit for both sides and to work cooperatively to achieve that. Certainly nothing concrete in that statement. Manus a lot of our guests suggest it really is a the mature brains, janet yellen who was present, Stephen Schwarzman was there as well, the head of black rock, and wilbur ross. But youy are talking, have to ask the question, are we back on trade war watch . We seem to have gone back a few steps here. About three months ago, almost a bromance seem to have emerged , somen district trump concrete steps as well, not all just words. To initial services the secondut now day, and things of not gone so well. Were back to the stage where analysts are little more on edge. Maybe the long feared trade war that people have for it about since mr. Trump first came on the political scene, maybe we are back to worried about that again. territory, malcolm, thank you very much. Between nce of difference of opinion, that start with talk of a trade. Its important that the u. S. Stake out its position in terms of pacific types of products or services or markets that are now closed to u. S. Companies and how they need to be opened up. The u. S. Needs to press china for a timetable and commitment, a very measurable commitment to opening up so many sectors of the chinese economy that are now closed to u. S. Participation. China is americas number one export destination outside of canada and mexico. And the twoway trade between china and the u. S. Reporting create millions of jobs here in america as well as millions of jobs in china. Sell are made in usa goods and services to china, the more jobs we create here at home, and it meets so many needs and demands of the chinese frommer and companies china. These are the propositions we need to keep pushing. What is the most successful way to push those solutions . Is it just through this kind of dialogue, is it true sanctions and tara tariffs and other measures . Do you use the carrot and stick both, or is one more successful than the other . It will only lead to a trade war, because if the president were to follow through on his of 55 tariffs of all chinese goods coming into the u. S. , theres nothing to stop china from doing exactly the same thing on u. S. Owing into china whether it soybeans are weak or be, medical equipment, automobiles. That would really hurt the u. S. Economy and raise the price of goods that American Consumers in thee every single Day Department stores, Hardware Stores and things like that. Jobs. Ld also eliminate so many of the jobs in america are export related now, and china is a huge market, so that would have a major impact on the u. S. Economy read in a trade war, everyone loses. About the idea of the u. S. Cooperating with him of the other nations in whose interest it would be to get china to stop some of these actresses . Do you have any optimism to stop some of these . There are many opportunities for u. S. Cooperation to make treatsina opens up and Foreign Companies fairly and gives them an equal opportunity to compete in china. We believe in competition and we ofieve the superiority highquality American Products will do very well in china if given a chance to do so there. Anna that was gary locke giving his take, divergent from the administration. Manus nobody wins in a trade war. Never a truer word has been said. Everything you need for your trading day, you can join in and ask questions on the conversation. You can also get me looking very confused. What are those noises in my head . Up, boosting the euro as well as yields. How much will mario draghi reveal later today . We will discuss that next. Manus 1 47 a. M. In the city of new york. Flat on the u. S. Equities. Draghiention when mario delivers his message to the market. Lets get the business flash and hong kong with Juliette Saly standing by. Good morning. Juliette sap has raised its outlook after a sales job. The German Software firm projecting sales of 23. 7 billion euros for the year. It announced a Share Buyback of about 500 Million Euros this year. We will speak to ceo filmic term it in his first interview of the day at 11 30 a. M. U. K. Time. India has approved the sale of a ,take in the state run refinery according to a person with knowledge of the decision. The deal will make oil and Natural Gas Corporation the number three refiner. Oilplan to create an indian giant for consolidation and mergers was first outlined in february. Bank of america is told Investment Bankers to stop working on transactions with one group amid growing concerns about it debt levels and rate structure. U. S. Banks will joins other firms in steering clear of advising and financing the deals. Representatives for bank of america, citigroup, and Morgan Stanley declined to comment. And a new macroeconomic hedge fund to be run by a portfolio manager. He ran a portion of the main fund. The macro funds expected to start in the fourth order. That is your Bloomberg Business flash. Toughmario draghi faces a out act this afternoon when he announces the ecbs latest Monetary Policy decision. You may have to readjust expect haitians it policymakers want to make any changes at the next meeting. Manus that brings us to Michael Osullivan joining us from credit squeeze where he is the cio from credit suisse. Shes called goldilocks, she keeps skipping around, but the piece this morning is that mario draghi has to tread of very fine line. I love what you said in your piece, there are central bankers out there who want to publicly talk about tapering. Will he be dancing on the head of a pin, as one of our guest said today . He has some he different influences. There are people in the governing council who dont necessarily like qe. Companies in germany dont like it either. They will be aware of the fact that the recovery in the eurozone has come about largely because of the week euro. Frankly i think if he could cancel the press conference at todays meeting, he would do so. I think the risk in the market is if he doesnt explicitly address the recent strength in the euro, the market me take that as a green light to push the euro higher just a little bit. Although you could make the point that the strength of euro is more about dollar weakness. Anna interesting you think he would prefer to cancel the press conference. I wonder how many times he feels like doing that. Some saying they expect him to sound as dovish as possible today. Many saying he wants to keep quite dovish given what is happening to the euro of late. Does that dovishness live on . Michael i dont think he has to sound dovish. When he then comes to the sick are meeting and they approached topic of tapering, the transition would be all the ardor. Many ofnd point is that the developed world central bankers, i dont think its coordinated, or has it is synchronized in terms of their conversation. Think they want to bring about an end to accommodation in terms of slowly bringing it in. Weve seen the bank of canada raise rates and the bank of england have its own internal debate about raising rates. Other Central Banks in norway in sweden have been first what we saw is interest. I think you will strike a middle round between dovishness and being too hawkish. Manus essentially what he wants to do is avoid another spike. We saw the bund market quite aggressively react. 8 for theeady for end of the year. Im looking at the forecasting function on my bloomberg. Thats what he wants to avoid. The equity market take. 8 on the bund . It is interesting because theres a tradeoff between equities and bonds in the correlation has intensified recently. I think a number of things will happen. You may have the ongoing trade between i technology which may selloff. People will put money to work in financials. Financialsopean continue to look quite interesting. The other issue is what happens to many of the strategies that have then suppressing volatility. Yields have come down and bonds have rallied. Money margin, put more into equities. If you get a bit of selloff of the bond market, some of these will sell equities which could spot volatility a higher from these extremely low levels. Anna when you look at the policies of ecb in relation to the bank of england, how far behind the boe do you think the ecb should be . If you just look at the unemployment numbers, you would expect the bank of england to be way out in front. What should the time lapse be . I think the ecb has succeeded in being less publicly tortured than the mpc. Contralast month you had veiling statements from the it looks like theyre ready to make a speech sometime toward the end of this year or the beginning of next year. Ecb has been more unified. Point tohe ecb could the fact that the output gap in the euro is still more generous terms of there being fewer inflation pressures than the u. K. , which is had to contend with a very weak currency over the course of the last year and all the consequences that brings for inflation. The work of recent statements from the bank of england has been to take the. Dge off week sterling so it contributes less to inflation at the margins. Manus from the currency market to the bond market, there is a for. E that the data is to too poor. Worse. A will get that will make it harder and perhaps it is mispriced. There is a risk for the u. S. And the u. K. , probably more the u. K. Continues withk the desire to normalize and though youo so, even run into a patch of weak data. Anna michael, thank you very much for your time this morning. Ecbill bring you all the latest decisions and the press conference later on. We will talk about corporate earnings, next. So we need tablets installed. With the menu app ready to roll. In 12 weeks. Yeah. The world of fast food is being changed by faster networks. Data, applications, customer experience. Which is why comcast business delivers Consistent Network Performance and speed across all your locations. Fast connections everywhere. Thats how you outmaneuver. So new touch screens. And biometrics. In 574 branches. All done by. Yesterday. Banks arent just undergoing a face lift. Theyre undergoing a transformation. A data fueled, security driven shift in applications and customer experience. Which is why comcast business delivers Consistent Network Performance and speed across all your locations. Hello, mr. Deets. Every Branch Running like headquarters. Thats how you outmaneuver. Its monetary stimulus and delivers a timeframe for the inflation target. Get the ecb decision. Anna u. S. China talks. Agreeing to cooperate on the trade deficit for the u. S. Commerce secretary scolded china over the impact. Manus health care debacle. To President Trump tells Senate Republicans they repeal obamacare, a move that could leave 32 miller million 32 million more americans without insurance. Manus youre welcome to bloomberg daybreak europe. Anna a has gone 7 00 a. M. In linden london. We have numbers from easyjet. They carried over 3 million passengers. 93. 1 , they have increased the capacity, Third Quarter increasing capacity of 9. 5 to 24 million seats so they are carrying more passengers, their load factor is up, this is a nice set of numbers. Thirdquarter revenue 1. 39 billion pounds so those are the top lines, the guidance in terms 2017, pretax profit will be in the range, 382 400 million 400 20 Million Pounds, that is the guidance for this year. Anna unilever are giving us the numbers, they say the top revenue has committed in at 7. 7 billion euros, a little shy investment of 27. 8 3 billion. Underlying sales up 3 . Focus is on the profitability. What can they deliver, it has been a tumultuous six months including the failed approach. Rom kraft heinz they had been worrying, analysts recently because possible bid, seems they stepped away from something moved them away from it. Lets talk about in terms of the strategy and where it goes and where the potential bid intensity is focusing demand in regards to profit. Underlying sales coming in at 3 . 3. 1 . Timate was for just a touch below. In april they said they would do their margarine spreads division, this was in response to that bid approach, it could fetch 6. 6 billion euros. We will see whether they have updates and we are for fullyear guidance from the business. They said organic Revenue Growth had been between 3 to 5 . We will watch for that. The easyjet numbers, the past couple of weeks we saw shift, the average estimate was 375 Million Pounds but this is a shift upwards. His is one of the last numbers this is an upgrade to the target, 380 tod 400 20 Million Pounds. The consensus was 375 which had risen by 1. 6 over the past four weeks. We did some polling into these numbers. Not only is it and upload in terms of the load factor and the total number of passengers up by 10. 8 but it is an upgrade for the yearend. S. A. P. Of greater their numbers we are year and so seeing this momentum, it is one of those themes that will come through and easyjet setting up there european alternative hub in the anna. On target for their trading margin. Giving us numbers, growing in line with capacity and capacity is up by 8 or 10 . We will be speaking to the ceo of spinner, his first interview at 7 30 a. M. U. K. Time. Manus all the equity markets are indicating higher. A lesser commitment and attacked to keep their Quantitative Easing Program running as it is, you have equity markets higher and new records yesterday evening in the u. S. , the equity markets remained solid. We will get into the momentum behind these markets in just a short while. Anna the risk radar showing us the ninth asian stocks are up for the ninth day. Alltime highs. The world index showing record highs. We have the estonian dollar in their as well, a bit of movie it movement. Backing oil from that little bit. The euro in their as well. Manus what is he going to say this afternoon, will it tries the euro higher . The market is net long for the first time in two years so this gives you a sense of the momentum behind the euro. In terms of the speculative positions, they are the most bullish of the euro cents 2011. Enough, not hawkish surprise. Dovish shall we have a look at the bonds . Anna we have all of that conversation around the ecb. Watching if he is not too hot, not too cold. It does not create any kind of interest surge in yields. That is the focus. Lets get the bloomberg first word news with Juliette Saly. Juliette thank you. U. S. President donald trump has told Senate Republicans they should stay in washington until they repeal obamacare. The move sparked renewed negotiations two days after gop efforts to enact a new Health Care Law collapsed. A group of 20 republicans met at the s night with white house officials to hash out possible costs including reviving a measure proposed by mitch mcconnell. U. S. Senator john mccain has been diagnosed with a type of rain cancer that was discovered when doctors removed a blood clot above his left eye. Tissue tested after the procedure last friday refold revealed a glioblastoma. Has been cooperating recuperating at home. President obama said he is an american hero. Has said heump would not have appointed attorney general Jeff Sessions if he knew that sessions had recused himself from overseeing the Russian Election investigation. He called the decision very unfair to the president. Accused [inaudible] with the u. S. Ed to start constructive cooperation to narrow its trade deficit. The statement from the ministry came after highlevel negotiations broke up with the two biggest economies unable to produce a joint statement. 10 talks got off to a start. Both governments canceled their Closing Press conferences. Finest minister finance minister [inaudible] speaking at a hearing at the National Assemblys economic we want oure said money back. He added that talks on the rate of exitt form the start negotiations. And reassuring businesses about her brexit plan as theresa may begins here first serious consultation. Having spent her first 12 months in office attacking industries for overcharging customers and not paying staff enough she is now trying a more conciliatory reproach. Global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. You can find more stories on the bloomberg at top. The sessiony of coming through in asia. Ae regional index of four ninth straight session, the longest run of strength we have had since april 2015. The original Index Holding onto those levels. We have not seen them since december 2007. The nikkei closing higher by. 6 of 1 , clear of the 20,000 point level. The boj pushing out its deadlines for the inflation target. Australias market closing higher by. 51 . We had unemployment pick up slightly by. 6 and chinese stocks well bid, the kospi at record highs. A new partner join the bid for billion wonder. Lg display to the downside in korea after a report on lcd panel prices falling. Have a look at this chart as we talk about the aussie dollar. It done not get through the 80 did not get through the 80. Ent. 80 at 1. 5 . Rate is it has risen 6. 5 in june. Analyst at hsbc saying that is the effects of a rate hike. Normally it makes the currency move by around 5 . ,he aussie dollar very strong stubbornly strong and having a bit of a negative impact or not what the rba is wanting for the overall economy but it does seem to hit this level of resistance around 80 u. S. Cents. We have not seen it that high for two years. Manus thank you. Japanected the bank of took no steps to dial back its aggressive monetary Stimulus Programs. The central bank did acknowledge that it has been too optimistic on when it can achieve that holy grail to prevent 2 inflation target. Kathleen hays joins us from tokyo. Good to see you. Where the the boj governor is due to speak in half an hour. The doj is more optimistic on growth and some would say moralistic on inflation. More realistic on inflation. Kathleen what caught my eye is catching the eyes of all the reporters in this room, our lumber keiko team, the top reporters from all that tokyo. Nd Japanese Press maintaining all its policy tools, and has to maintain quantitative easing, yield curve control, buying bonds, even buying etfs because it is determined to get to that 2 inflation target. It had been negative, it has made progress. Finallynotably did acknowledge it has to push out the day when it can meet that inflation target. Theyre looking at the fiscal year starting around april 2019, that is a year later than they had forecast in the cap the cpi forecast to 1. 1 from 1. 4 . Abouters are going to ask that. Breaking big is stories about etf, the bank of japan is getting more concerned and the Tokyo Stock Exchange is the governord, will be asked about that. The final question, if youre inflationry to hit 2 and continue aggressive andcies, is a sustainable, one final thing. The rest of the world is trying to head for the exit. How is that going to play out for the bank of japan . These are the questions that will be asked in about 20 minutes. Manus thank you. We are waiting for those lines to come through. Lets focus in on one of the reports we have had. We are pleased to talk to the cfo joining us from copenhagen. Well done on the numbers and as we look through them, is this sustainable, is there enough in the numbers to sustain this kind of trajectory . Jacob good morning and great to be here again and thank you for the comments. We are pleased with the quarter. It is a continuation of that we have seen for a number of quarters now and good lending growth across the nordic countries. Continuede and a strong loanloss impairments progress. Pleasingt has been a quarter but it is a continuation of what we have seen in a numr of quarters. Especially pleased with the capital built, Building Seven basis points. And overall, very pleased but we do not think there are any it is a in the quarter, continuation of that we have seen for a number of quarters. Grow your continuing to despite years of negative interests. How much better are you getting with dealing with that, is the situation you can assume continues or do you see change ahead . Jacob it is the right question to ask area and we are on a list a bit of an experiment. In terms of expectations, we do not have of view as to whether rates will suddenly start moving in the foreseeable future. We plan our business force, this Interest Rate environment is to attain for a number of years so we are not assuming any help from rising Interest Rates area to a look at the way we are dealing with it, i do not think we are doing anything different in recent quarters. We are making sure we are there to support our customers. It drives customer activity in a number of areas. In terms of the Business Model it has been a gradual change over the last couple of years, making sure it is still valid and delivering in this type of environment. We are not expecting major change, we will keep working hard on mitigating in a negative any negative side effects. Manus you describe yourself as being [inaudible] well. Ing quite im looking at the breakdown of the numbers. Net trading declines from 2. 14 billion krone and last year. Things not as aggressive for you there, how is the flow, how are the clients holding up . You are the you are winning market share, even if the number has dropped finally. Jacob that is the right question and we still deliver that performance. When you look at the quarter, across the board, no doubt that the entire sector is lower, and we are pleased with the number we came out with. When you look at the trading income last year be aware that underlying we are better than last year on the trading income. Q1 was incredibly strong, you know that across the board. Holding market share so we are pleased with the performance. Need they decided they more time and copenhagen is somewhere that they are considering all of these links to Banking Unions to some extent. The andant to see ferment that you operate in being part of Banking Unions, do Banking Unions hold the cachet despite the diversion ways we saw the spanish and italian banks being with recently . Jacob that is to questions, we have no view. They need to do what they think is sensible and we will take note of that. In terms of Banking Union in general, they view is positive. It could make sense for them to be part of the Banking Union, there is a number of things that needs to be considered in terms of the danish banking market. Generally, the idea of the notion of the Banking Union is something we are positive towards. You mentioned the recent of elements in spain and italy, we think that when you look at what happened in spain, that is an example of the system working well. Situation before it becomes critical to the system. That has not changed our view on the Banking Union but there is a lot of analysis that needs to be done before anyone has a view on them joining or not. Manus your central bank is quite prolific in terms of the ascending and the noise they are making. They say there is a risk. Risk, ofdustry is at missing several warning signs that were pointed towards another crisis, there is a very a reason to watch out for speed blindness. Haveave a great story, you record after record, but where are you, are you speed blinded, what are the bumps in the road that we are not talking about . Is raisingral bank some central issues. We are watching the markets which they are referring to. We are watching the Property Markets when you look at the danish Property Market which i guess is their main concern. It has not risen to the level you have seen in other european countries. The market still has a legacy from sorting out the last financial crisis. The Property Market has had a strong rebound. We are monitoring that closely, were focused on our credit quality and maintaining our standards. We acknowledge prices have gone up. We do not see a bubble as such emerging and the danish housing market. Where watching any subsequent. It is the right thing to be vigilant. We are vigilant, we are not income place and to run these issues. Were making sure we maintain strong credit quality is weak euro as we grow. Are you stepping back a little bit, are you getting more aggressive in terms of the term he used and this loanloss provision are at abnormal times. It is beyond normal. Are you stepping back, are you taking any measures to priced differently, do you think these loanloss provisions can extend at these levels . Jacob there is no doubt that we are we agree that having reversals every quarter which we continue to have on a quarterly basis, and the longterm it is not a sustainable thing. Aching is about taking risks in a reasonable way and that leads to credit losses. That is the banking model and we do not think that has changed. We are in an environment where our clients are employed, there is no implement in our markets and they are paying close to zero Interest Rate area reversal is a natural extension of that. At some point that will come to an and and we are clear about that. That, high loan losses in the foreseeable future but at some point we will normalize and that is fair. Our growth in sweden and norway has been focused on certain segments but we have been focused on these Association Agreements especially with the association of academics as an example in sweden and norway. We are trying to be selective in the way that we grow. The high growth rates are driven by the segments and as a final note, we also tightened our lending last year in sweden and norway. Where focused on this we are focused on this all the time and it is something to state fragility around. Anna thank you, jacob aarupandersen. We are getting some breaking the numbers coming in in line with estimates. Pretty much in line. Indicated sap has 1 lower. Raised their numbers at 23. 3 billion, they have gone for stock i back, they are raising their overall numbers. 1. 1 , lets see how it opens at the start of trade. Anna we will keep an eye on stocks that have reported numbers. U. S. China relations at the latest on the American Health care debate. Talks have ended badly with both sides canceling a press conference and unable to raise release a joint statement. Janet yellen was part of it, wilbur ross, mnuchin was there. Wilbur ross opened up with a salvo which paraded the chinese. Thearaded berated chinese. Some Good Progress after the bonding that took place between president s trump and xi. It looks like the honeymoon was over. The marriage will continue and talks will continue, it is not look like an overall trade war is breaking out but the progress they made did not seem to solidify here. They could not agree on a joint statement or a joint press conference. They put individual statements. The things have changed in second meeting. That markets a to be aware of. Yesterday we were talking about how the Health Care Legislation seems to be dead in its current form and that we got a new cbo score coming through and further talk from trump about whether senators need to remain in washington over the summer to get more work done on this. What is the latest on health . Get ast of all, we did cbo telling us an estimate of how many additional americans with those their health care under the current bill. This would be the straight repeal. They would be an additional 23 million americans who would Lose Health Care by 2026, another 10 million from the previous bill. That makes it hard for some senators who might be on the fence, particularly moderates to vote for this because they have to go home and explain these votes. Knowing that, the president met with some key senators, republican senators, had them over to the white house and said, you need to do this, if you do not do this, if you do not repeal, that is saying that you are fine with obamacare. Giving them a bit of a warning and saying you should cancel your recess, your august recess rather than go home without having done this. It is very hard, very and clear what the path forward is. Manus i would love to meet a politician anywhere in the world that would give up their summer recess. Thank you for joining us this morning, Jodi Schneider in hong kong. Lets talk about the markets. There is one thing that gets us in an up the mood. The brexit parameter is a bit rainy. S. A. P. Lifts their target due to stock buyback, stocks lower, firsthalf profits down by one per 6 1. 6 . Anna the story around the headquarters, theyre waiting till september to make a decision on that one. They feel they will be able to do that. That is what they told us earlier on. Eps beating estimates, prices increasing, part of the story at unilever. They have been under pressure to deliver after that sales bid kraft. Aft ceo, we have another sap the first interview at 11 30 a. M. , they are doing a stock buyback. Those are the questions for bill mcdermott. Guy johnson is next. Guy good morning, welcome, it is thursday morning, youre watching bloomberg markets, the european open. Cash is about to open in europe, well see how the equity session develops. Matt miller not here today. I am guy johnson. Say nothing. Mario draghi, candy and is to stay silent on the Central Bank Stimulus exit plans . Keeps itsntral bank exit plans unchanged. Governor