Dubai to london. In hongg, and the kong, a Record Number of candidates cast their ballots. Bloomberg spoke to the said Party Founding leader to get her take away from the election. Now the ball is in the governments court, and really have to respond to the five demands with an independent inquiry into recent events. Theres also the demand of universal suffrage. The government at least has to say that they are listening. Alix for more, bloombergs yvonne man. Joins us now. How does this affect what is happening on the streets . Yvonne all eyes will be on chief executive carrie lam as she speaks Tuesday Morning to reporters here in hong kong. She has delivered a lot of these press conferences before under increasing pressure. Before, that pressure has translated into a democratic exercise. 2. 9 Million People showed up to cast their ballots, a record turnout of 71 . It was a landslide victory for the prodemocracy camp. These district elections are pretty low level. These counselors dont have a whole lot of political power. But this election this time around was seen as a defective referendum on the governments handling of this political crisis thats gone on for nearly six months. The key question you just heard, will she actually concede and meet some of the five demands the protesters have been abandoned . The ball have been demanding . The ball is officially in her court. What happens, any efforts to create chaos and disrupt stability and prosperity in hong kong will not succeed, shes said. Alix we turn now to trade. China is raising penalties on intellectual property violations as it tries to address one of the key Sticking Points in trade talks with the u. S. Putting me on the phone from hong kong is enda curran. What are the details of what we know about this ip theft penalty . Specifics arethe that china wants to make it easier for victims of ip theft to get compensation, and they also want to look into bringing up the threshold for criminal punishments. On the surface, this kind of measure goes to the core of some of the u. S. Demands in the trade negotiations. Beyond the merchandise goods, the u. S. Has been pushing concerns over ip protection for its Companies Operating in china. On the terms, this fits the emerging meredith the emerging narrative that we remain on track for a trade negotiation. That xiadly, we know jinping spoke of the need for cutting a deal based on equality with the u. S. President trump pushed back against that terminology. Negotiators from both countries have been talking to each other, but we dont have details about when or where an agreement might be signed. The ip move by china is clearly a sign that talks remain on track, but we are still unsure about the details. Alix thank you very much. We go now to the middle east, where turkey is beginning to aa rated hex system radar detection system, a move that risks touching u. S. Sanctions. What is the surprise from overnight . Can you talk us through the significance . Reporter on the face of it, it could look like another Incremental Development in the s but theems from russia, significance is there was widespread speculation that turkey would keep the Missile Defense system in the box, sort of, in order to not antagonize the u. S. And risk sanctions. This shows that actually, turkey is going ahead with that, and why is this significant . It risks action from congress, which has championed sanctions against turkey. We saw the lira reversing gains. We saw stocks drop. Now everyone is watching for rid of a reaction will come out of washington, from the ministration or capitol hill. Administration or capitol hill. Alix thank you. Tois johnson aims consolidate his lead ahead of a general election. Alix alix hings joining me now from london is edward evans, Bloomberg Brexit editor. Did we learn anything with the conservative manifesto . Edward no, this is really about mitigating the risks. That manye manifesto blamed lost the election for brings may, so it nervousness with the conservative party ahead of the elections. Yes, there are tax cuts for some in there, there are pledges for 50,000 more nurses, and for more infrastructure, but look more deeply and you will see some of these pledges are balanced out. The tax cut on National Insurance is balanced by an increased corporation tax, but every extra pound Boris Johnson is promising to spend, Jeremy Corbyn is planning to spend an additional six. The big thing is brexit. Boris johnson makes it clear this is about getting brexit done, getting a deal for parliament, and getting a trade deal by the end of next year, something that many observers suggest would be very difficult. Alix thank you very much, bloombergs edward evans. It is merger monday. A lot of deals on the people. Lvmh agreeing to buy tiffany for billion, 16 the largest luxury deal ever. With more is annmarie hordern. It is a hugearie day for retail. This is the biggest in the luxury space. It started at 120, but they were able to think this deal at 135. To really get bid control and expand their portfolio in jewelry. They are dominant in clothing and cosmetics, but ranks third globally for jewelry. With tiffany, they could possibly unseat richemont. Another deal this morning in the finance space, Charles Schwab. They are going to have a huge sway over the brokerage industry if they are able to have this deal with td ameritrade, about 26 billion this deal is worth. That is about 5 trillion of assets with these companies. There could be some red flags for antitrust regulators. And novartis buying up a u. S. Company based in new jersey medicine. How they expand their portfolio is really through acquisition. Medicine has a very promising cholesterol drug. We seen medicine stock triple with this excitement of the drug that many people say is really important. Alix thank you very much, annmarie hordern. Something else i am watching is uber. That stock down almost 5 in premarket. Londons Transit Authority refused to grant it a new license. The reason, rider safety. It is still concerned that unauthorized drivers can manipulate the app to carry passengers. There are more than 45,000 drivers in the city. Currently, uber can still operate while a Magistrates Court considers the decision. Coming up, more on your morning trade and analysis in the markets in todays first take. This is bloomberg. Alix time now for bloomberg first take. Joining me from our inhouse team a wall street veterans and insiders are Gina Martin Adams, Vincent Cignarella, and also joining us is vinay pande, ubs Wealth Management head of trading strategies. Happy monday, everybody. We made it. We got up. Thats the first thing. [laughter] goingpotentially, we are to have ip penalties. What do you think about that as a traitor . As a trader . Think it is a good step Vincent Vincent i think it is a good step. We are just too far away from the election to close a deal completely yet. We also have a lot of hurdles yet to go. But the ip thing is a huge talking point for the president to take this forward to say we did get a little more from china. Its the face he has to put on it. We need to get a little more because we are coming in under loaned to begin with. This is a big step forward to make it appear that we are getting a better side of the trade, and that will sell politically down the road. Alix is this an excuse to buy risk . Gina i think it is. I think the signal is more important than the reality. Ultimately, i think investors will say, what does this really mean . Will there actually be any action as opposed to just words . But it is a signal that we are moving in the right direction, and that is all that matters for the market right now. Both gina and vincent are broadly right. There is very high uncertainty. Because of the fine balance of think, fromnty, we a short to medium term point of view, it is neutral for your strategic allocation. Moree didnt to be much longterm oriented, and our Investor Survey we disconnected should this nearterm nervousness about geopolitics, trade in particular, elections and so on, but high confidence. N the future there are incredible opportunities further out, and things to focus on at a time like this. Vincent it is hard to disagree with you going into the end of the year, to take a little off the table. Its been a good run lately. You dont want the hiccup of december from 2018 all over again. Going to be plenty of opportunities in 2020 to get on board this trade because theres going to be a lot of volatility, i think. Thats one thing we can be sure of with this trade deal, is that vol is going to be there. Alix but technically, there is no volatility. Vincent but i think it will. I think thats one of the trades we will see pickup in 2020 as this deal comes to fruition in the headlines float around it. Alix does anyone care about phase two . Gina no. [laughter] gina its a great question because supposedly this is going to have some followthrough, but the fact that we have taken so long to get to phase one means we cant even think about phase two. I think that longerterm investors are saying, how do we get to phase two in an Election Year with an impeachment . But with everyone so shortterm focused, it is just getting to phase one and the end of the year. But that does present a risk coming into the early part of the year. You say, ok, now what . Where are we going to go from here . You start to thing about policies, frexit on our minds at the early part of the year. It all comes crashing back on you. But for now, it is progress. Vinay and phase three, if there is one. Alix no doubt it is important. Vinay but it is not just a matter of being important conceptually, which it is. You cant have a portfolio that is dependent on your gas about a political your guess about a political outcome because we have no idea how it will end up. We think, in the near term, you should be more consumeroriented. You should be with companies that are more inward looking because globalization, this incredible move we saw over 15, 20 years, has either stalled or is maybe in reverse. So your portfolio has to reflect reality. This is not a thing to do over the next 10 years. This is something to do now. So you have to act upon it, and we are acting upon it. Alix i feel like the problem is that if youve hedged, that hasnt worked when it come to politics. As a trader, how do you find something that is not exposed . Vincent you dont trade politics, per se. Can seeithstanding, you the values of trading cable in brexit, but i think one of the things weve looked at in terms of the positive signs in trade, what china is doing right now, this is very much the Financial Stability situation in china. China recognizes that only local level, it would probably get out city and state wide debt basis. The states and municipalities had a similar situation. Look for fiscal stimulus, and theres no where to find it. This is china prepping for a fiscal stimulus move down the road should the wheels fall off on trade, and even if they dont. They will be in a strong position to stimulate their own economy and potentially the global economy. So i think it is a positive to go about the road into 2020. Alix i guess the other part of this is that big ball of money, that if we take it out of china, does any of this move out of the u. S. Into europe and emerging markets on a sustainable basis . Gina i think it is starting to. You had breakouts in canada, and europe. It is starting to move to developed markets beyond the u. S. As risk tolerance is coming back. It is not moving en masse to emerging markets, but there are pockets of strength. Russia has been on fire. Russian equities are breaking out higher. Or are pockets of strength in emerging markets coming. I think developed market strength is broadening beyond the u. S. As we start to look forward to slightly better growth in the year ahead. It is all following Monetary Policy moves. The other thing when you think about the longerterm view is what is happening with Monetary Policy, that is the policy that really moves risk tolerance. This catullus he is important, trade policy is important, but policy is important,. Rade policy is important vinay these markets will catch up. It is a good time to go neutral if you are a very aggressive trader. Belong thepaid to u. S. And short everything else. I think that has probably run its course, and we should be broadening out. Vincent i totally agree. Weve been talking about the end of the dollar bull run. I think 2020 is going to be an em story. Yield inll be seeking attractive markets that can go higher on a more positive trade deal. That probably will see growth move from the u. S. To not necessarily other developed markets, but i think more to emerging ones. Alix you had goldman and i think you had jp morgan and i think Goldman Sachs betting on emerging markets. Thats going to be why you are going to want to buy them. Why nots year, th this year, though . Gina it has started to become a trade this year. We saw increasing pmis in the summer months. But it built in other developed markets, not yet in emerging markets. It is a pick your spots story, and that is because the dollar has not totally turned over. The dollar is really hanging in there. For emerging markets to outperform, youve got to see the dollar turnover. Vinay its already begun. If you look at what benefits first from rate cuts across emerging banks, emerging market bonds have done very well. Sovereign debt in dollars in emerging markets has done extremely well. These countries are much better funded than they were 20 years ago. That is something we are acting on as we speak. Alix cable, are you trading it today . Vincent vincent im always trading cable. Thats haunted me for the better part of 40 years. [laughter] vincent im not a fan of sterling closer to 1. 30. Thats definitely not where i want to be buying sterling. Alix Gina Martin Adams and Vincent Cignarella, thank you very much. Vinay pande will be sticking with us. It reminder, any charts we use throughout the show, go to gtv on your terminal. Check it out and save all the charts. This is bloomberg. Viviana you are watching bloomberg daybreak. Its a multibilliondollar deal that will reshape the retail brokerage business. Charles schwab agreeing to buy td ameritrade, valued at about 26 billion. Schwab is capitalizing on the industry shock it created last month by cutting commissions on u. S. Stock trading to zero. Schwab was americas original discount broker when it was founded almost a halfcentury ago. It is the largest luxury goods deal ever. Lvmh agreeing to buy tiffany for more than 16 billion. That will raise the french companys profile in jewelry. 37 deal values tiffany above the price on october 26, when bloomberg broke the story of lvmhs initial approach. Novartis agreeing to buy 9. 7 billion for the price. 9. 7 billion. The price is a 47 premium for medicines. That is your Bloomberg Business flash. Learned carlrg has icahn plans to nominate a slate of 10 directors. About 3 in oxley is of the company. Hes unhappy about the companys takeover of anadarko petroleum. Shares have fallen 41 . Many people i have talked to our unhappy about the deal and the levers, but not necessarily into how carl icahn is handling it. Coming up on this program, ubs global Wealth Management calls 20 a year of choices. We will talk about what those choices are all 2020 a year of choices. We will talk about what those choices are. It looks like we are treading water. Movement, the european Retail Sector up 21 . We have a lot of supply coming on in the twoyear, particularly the bond market, but the twos continueshe twostens to flatten. Commodities not feeling any uplift from trade, treading water around the. Happy monday, everybody. This is bloomberg. Alix this is bloomberg daybreak. A quick check on the markets. Equity futures tread water a bit. Nothing to write home about here. Part of the story is luxury retail. Watch that space as we head into the open. Twostens continuing to flatten. The cable rate the performer former in the g10 space. Have Jeremy Corbyn gaining in the race against the conservative party. Ubs Wealth Management writes, year ofbase case, in a choices for policymakers, the base case is greater than usual. With a still is vinay pande. I feel like with every outlook, it feels really binary. That in assetage or location in Asset Allocation . Vinay good question. The first is if you are a hostage to the uncertainty described, the truths we have listed, you are either going to be right or wrong. Insightave very special into what is going to happen on all these fronts alix good for you. [laughter] vinay we dont. To neutralize your exposure to these outcomes, focus on where the strength is likely to be. Avoid the sectors that are more challenged. Consumer discretionary had some news today. Its an area we like. Munications is an area we Like Communications is an area we like. We are a little more defensive. Round technology in fixed income, we are a bit overweight. We like emerging market bonds denominated in dollars. Hise have solid five its cash solid finances, and we think that is attractive these have solid finances, and we think that is attractive. Across the board, in a diversified way, owning emergingmarket sovereign debt in dollars is a good idea for u. S. Investors. Inflationse, we think breakevens are incredibly low, and they are suggesting the fed is doomed to failure. It is a little early to give up on the central bank yet. I think for that reason, we like tips. Nominal fixed income is were flipping a very poor outcome which may or may not transpire. Alix in that scenario, you dont need 3 inflation. You just need inflation to not go lower. Vinay exactly correct. Alix when you take a look on a regional basis, say when youre looking at communications and consumer discretionary, is it u. S. Versus europe versus em . The pain trade for u.