Rejected. The eu is expected to approve a brexit delay as a fasttrack deal is blocked by mps. A fresh election could be in the cards. Softbank swoops in. Wework accepts a 9. 5 billion bailout from the Japanese Investment firm. The company is now worth less than 20 of its valuation in january. Semiconductor stocks fall on weak forecasts from Texas Instruments as the trade war bites. Good morning. Matt we are less than a halfhour away from the european open. Taking a look first at the treasury yield, you can see we have come higher and are now going lower. May a riskoff day. Take a look at what the futures trade is showing us across europe. Ax futures down ftse futures so far have been little changed. Dax and cac futures are both down substantially. You can see the parisian equity twox futures down more than thirds of 1 . In terms of u. S. Futures this morning, a sea of red. S p, dow jones, and nasdaq all off. What does the set up look like in terms of brexit after last nights big boat . Vote . Anna the question is whether we are headed toward an election, or when. A withdrawalto get agreement before then or are we just going to go to the election . Either path seems to require some kind of delay. It looks unlikely we leave on the 31st of october. Even with parts of the government talking about no deal, many guests we are talking to are suggesting the possibility of no deal is really reduced now. Certainly at the end of october. Is on whetherus we see a general election. You see the reasons one he might decide to call that, but you can also see why he might decide to go for a new timetable, one that takes some kind of delay from brussels and works with that to try to get a Withdrawal Agreement from parliament. Lets talk with maria tadeo, who is live from parliament with us. We heard from donald tusk he is going to recommend an extension, but then it is a question of how long and how they go about this. What is next . Right. Is to the question of will the eu grant more time, that is pretty much a nobrainer. The eu has made it clear they do not want to know deal brexit. They do not want to force a no deal brexit. The key breakthrough the Prime Minister is close to getting this deal, so they do not want to push him into no deal. Granting more time is pretty much a given. The debate is whether or not this is going to be a short extension, perhaps a matter of weeks. That is what Emmanuel Macron has pushed for. Pilelieves this will pressure on mps to get the deal done. Wayaps it will go all the to january 31, 2020. Perhaps it will include the possibility to allow the u. K. To leave before that if they get a deal done. The question is not about time, but just how much time. Much. The question how thank you very much. Bloombergs maria tadeo joining us out of brussels. Marketus in the conversation, mark cudmore in singapore. . Hat does this look like to you can we discount almost fully the chance of a hard brexit . That is fair at the moment, but im not sure its going to save sterling from weakness. Hard brexit was not priced at a high risk anyway. It was a growing tail risk. What we are heading toward is more uncertainty. Thats not a great backdrop for u. K. Economy that is already showing signs of severe struggle. It is expected to be one of the slowest economies in the world next year. The forecast is 1 , assuming theres not a new deal brexit or tail risk. Overall, the uncertainties of brexit negotiations is bad news for sterling. Anna very good to see you once again. Do markets sense that Central Banks are near the limits of what they can do . This is an ongoing conversation we have been having into the extent to which Central Banks can really be the difference when it comes to the Global Economy right now. Think this is going to be a reoccurring theme. Im particularly interested in the moment that we are in the midst of most Central Banks and acting aggressive easing. We are seeing yields not just refuse to go lower, but start to climb. The u. S. Is a great example. The fed is about to cut rates next week. Hey, centralt banks are easing aggressively, but it is not driving yields down, it is a crawler he. Maybe it will it is a corolla ollary. Orr it has been bouncing around. Wondering where the next breakout is. When people start losing faith in Central Banks, the major proxy driving that risk asset strength, if people start believing centralbank action is weakening, this is bad news for equities and it is bad news for bond markets as well. There any chance it is not we are feeling the depth of a recession right now, but we are getting continued bad news from automakers. Germanys gdp is set to come out early next month. We could have a recession there. Is there any sense you could get a fiscal package maybe out of berlin . Maybe even concerted fiscal action from governments . Imf,e news flow to the that seems less likely now. Germany is getting backing for not being more aggressive on the fiscal side. They are doing some measures already in there is no need for anymore. While we are heading slowly into growth, most people trading in learningoday, they are in the last 15 years or so. The last crisis is 2008. That was a dramatic one. It went sharply. A very bad worldly year later. Recession and financial crisis have been set in. Thats not always the way it is. If you look at the u. S. , there was a Global Growth recession to some extent in the early to thousands around 2002. That was a more slow one. A slowdown of the economy. A much more gradual recession. Germany is at the forefront of that pain. It is exposed to the brexit story. Epicenter. At the the economy is doing terribly. Government going to provide the fiscal stimulus it needs to bail it out . Probably not until too late. Anna you make me almost nostalgic for a good oldfashioned recession. Let me ask you about the earnings season. The story is Texas Instruments weighing on tech stocks. Is that indicative of this season for you . Do you believe it is better than that . Some of the earnings have been quite good. Very good overall. The bigger story is probably the fact we had seen estimates slashed for this quarter. We had 2020 estimates still so high. Those estimates are now coming down. That is the bigger story. We are not going to see Earnings Growth next year. We knew this quarter was going to be bad. It has not been as bad as feared. It does look like we are in this prolonged period of not just lack of Earnings Growth, but recession. Earnings has been taken away. It may be a while before people recognize register the next year is going to be much lower again. Certainly it is no longer a support for having higher prices. Cudmore, things for joining us. Mark is a bloomberg mliv managing editor. We are asking on the blog the question of the day. Do markets sense Central Banks are near the limit of what they can do to spur growth the . Reach out to us. Lets get the bloomberg first word news now. The top u. S. Envoy to ukraine has directly contradicted president trumps assertion there was no quid pro quo behind his phone conversation with the ukrainian president. Claim inaylor made the a 15 page statement to house investigators. The president meanwhile has tweeted that the impeachment inquiry is, quote, a lynching, but added, we will win. Says chinaal times is drafting a plan to replace hong kongs carrie lam with an interim chief executive. The report cites unidentified people briefed on the deliberations. It says lams successor would be installed by march if xi jinping carries out the plan. The interim chief executive may not stay for a full fiveyear term. Assia and turkey have struck deal to create a buffer zone in northern syria. President erdogan talked with Vladimir Putin for more than six hours before announcing the agreement. Includes joint patrols and coordinated action with Syrian Forces to remove kurdish fighters from border areas. The kurdish ypg fought for years beside u. S. Forces, but turkey labels them separatists and terroristic. Haschilean president announced a series of Financial Aid packages in a bid to calm ongoing mass protests. The measures include a workers, a 20 increase in pensions, a scrapping of electricity price hikes, and higher taxes for the rich. Peopleernment says 16 have been killed in five days of rioting and violent clashes. Global news, 24 hours a day on air and tictoc on twitter powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Thank you very much. Next, softbank to the rescue. Wework accepts a bail out at a valuation of less than a billion dollars. Whats next for both parties. And for staff. Bloomberg radio is live on your mobile device or dab Digital Radio in the london area. Matt 15 minutes away from cash trading. Futures are down half a percent or more. Ftse futures are little changed. Wework has accepted a 9. 5 billion rescue package from softbank. Deal gives the japanese investor and 80 stake in the company at a valuation of less than a million dollars. 8 billion. It also sees the founder give up his board seat, but get two proxy seeds and walk away with a package including as much as 1. 2 billion dollars in stock. A half 1 billion credit line and a 185 million in consulting fees. What is the first thing that pops out of you from the softbank set up . You just ran through some of the weirdest numbers out of this deal. The fact i think is really quite gets 18 ofsoftbank wework, but they dont control it. Thats according to their own statement. Ause they dont have here shareholder controlling vote and they dont control the board. Instead, they will treated as an associate. The treatment will be different when you consolidate the top line, the bottom line. The Balance Sheet then becomes your Balance Sheet, but when you treat it merely as an associate, you avoid a lot of that. Accounting tricks going on there. Its not illegal, but thats what they are going to do. Amazing things coming out of the deal today. Anna that allows it to be treated differently in the south bank accounts. What about the broader implications for the future of wework or the sector . Wework, this is the start, not the end. Now softbank, which has control of the company, they have replaced their own coo as executive chairman of the board. It is their job to turn it around. It is their job to take that cash and make something of it, including reining in the spending. To look at all the long term leasing deals and see which ones work and which ones dont. Softbank goes from being a vc to being a pe. Now there have to be turnaround. From the broader perspective, this is not the first. Uber and lyft have both ipo and neither are profitable. Unicorns 200 or 300 around the world, none of which are profitable. Investors will be thinking, are they really worth of that . The answer will be no in many cases. Matt thanks very much for joining us. Bloombergs Technology Correspondent out of asia. We are minutes away from the open. Next, we will take a look at your stocks to watch, including swedbank. Lenders hit by rising costs related to Money Laundering allegations. This is bloomberg. Anna welcome back to Bloomberg Markets, the european open. Boris johnson could push for an election after mps blocked a plan to russias brexit deal into law, forcing a delay beyond october 31. Against u voted you had been tempted to back some form of brexit, so why did you decide not to vote in favor of the government in the first vote yesterday . I have taken the view we should respect the referendum result, but it needs to be a deal that protects jobs and livelihoods. I came to the conclusion having looked at the small print of the deal on the table yesterday that it was going to regulations, wos rights, environmental standards, consumer standards. It is difficult to do a freetrade deal with the European Union if the European Union thinks you are just going to be undercutting social and environmental thats why i came to the view we need to amend this deal to have a level Playing Field commitment. Anna some of the 19 of your labor mp colleagues who voted for this deal yesterday have suggested they only voted for it , similar to you, with a view to amending it in the next days. Is that a legitimate reason to vote in favor . It is a balanced judgment. I felt the signal you send by voting for something, which is going to open the door potentially to that sort of bonfire of our protections and standards, was just something i could not support at the second reading stage. I have profound respect for colleagues who took the reality is now it has quite a majority. Anna if it comes back, would you vote for it . If we can have a Prime Minister who stops behaving like a spoiled brat and actually comes to the table and says, lets have a timetable motion that is respectful of parliaments need to scrutinize the deal properly. Thats what was rejected last night. Then i think we can have a Committee Stage where we look at amendments. How we can anchor rights and standards more effectively for a level Playing Field. Colleagues are tabling amendment on the customs union, on how to avoid a cliff edge. Lets debate that and see what we get at the end of the third reading. The more amendments we get, the more likely we will support it. Anna do you think corbyn and johnson are going to be talking about the new timetable rather than pushing into a general election . I really hope so. Anna do you think that is likely . Affect Boris Johnson decided to pause rather than to pull it was a very important signal last night that he may well be open. He got quite a convincing majority for that second reading. You could potentially see that as a majority. When we go into the committee majority, he solid may well feel if we have a new timetable, a new program motion, he would have a decent chance of getting it over the line. I hope there will be constructive dialogue between whip and with chief the government chief whip. Anna coming up, the market open. We are bringing it to you live on bloomberg tv. Politics the perspective, keeping an eye on any conversations between various leaders in westminster about whether the timetable can come forward or we push toward the election. Toward the election. Futures point downward. Devices are like doorways that could allow hackers into your home. And like all doors, theyre safer when locked. Thats why you need xfinity xfi. With the xfi gateway, devices connected to your homes wifi are protected. Which helps keep people outside from accessing your passwords, credit cards and cameras. And people inside from accidentally visiting sites that arent secure. And if someone trys well let you know. Xfi advanced security. If its connected, its protected. Call, click, or visit a store today. Away from the cash open. Dani burger is standing by. It is all about politics today. Look at what the pound is doing. Holding onto yesterdays losses after parliament shut down Boris Johnsons plan to rush his brexit deal. Those proceedings are back in limbo. Hong kong equities underperform the rest of the market. The Chinese Government is planning to replace carrie lam. When it is not politics, it is all about earnings, Something Like 20 of the s p 500 reports earnings this week. Startingee the s p 500 to show some of that weakness. Speaking of weakness, look at these futures. Always a little bit alarming when we see Something Like the dax declining the most. Some signs of macro concern. Just a few seconds and the city until the markets open. The first market we are going to get is the u. K. , which is important because we have the latest brexit development. It is flat. That partly might be because the risk of a no deal brexit largely looks to have been cleared. That might help contain some of the losses we see in the u. K. We cannot ignore the fact that yesterday when the vote was happening, it had an Immediate Impact on the market. Some of which is carrying through today. Buying. A lot of haven the dollar doing better, swiss franc doing better, the yen is trading at a oneweek high after that vote. Throughout the rest of that market, something bigger might be clouding, it might be the macro outlook. France, spain, netherlands all turning downward. It might be the earnings that have markets concerned. Tomorrow, we get more readings on data on europe that need to be strong considering yesterdays s p global cut their outlook for markets when it comes to growth. Lets see how some of the sectors are doing. This is going to be really interesting mostly because today is largely going to be a factor story. It is a scary look. Red across the board. Some of the sectors to point out. Industrials looking very weak today. This is selling of more of the cyclical names, perhaps buying more defensive. It is really hard to see any green on the board. Maybe a bit in energy. Otherwise, it is really the factor story we are seeing. Investors dont want to hold riskier stocks. We can also see Something Like financials doing worse after bank earnings. Then we can see some Technology Weakness as well. We had Texas Instruments downgrading their earnings outlook. That might be really hurting chip stocks today. Matt, what did the individual names look like . Matt we do see for the most part stocks down for the most part. You can see 468 losers. There are only 100 winners. Among them, you have British American tobacco, one of the big gainers, up 1. 2 . It is a very defensive stock. As are a lot of the others that are big gainers. Diageo as a gainer this morning. Nestle as a gainer. Unilever as a gainer. The defensive stocks certainly are the big gains. No