Transcripts For BLOOMBERG Bloomberg Markets European Close 2

Low currencyhe volatility. The british pound is stronger, but very fractionally, up 0. 2 versus the u. S. Dollar before the election. Incremental moves on trade. Lets get to the latest now. Bloomberg reporting that u. S. Tariffs set to take effect on sunday will be delayed, according to chinese officials. Meantime, House Democrats said they will back the usmca trade deal and are planning a vote next week. Rep. Pelosi there is no question that this trade agreement is much better than nafta, but in terms of our work here, it is infinitely better than what was initially proposed by the administration. Vonnie House Democrats declaring a win there. For more, lets bring in bloomberg trade reporter shawn donnan in washington. Todays developments on the trade front, how incremental are they . Shawn i think we got one really important big step on usmca. It is a remarkable day in what is a highly partisan washington, when we see a bipartisan agreement on a trade deal. Trade politics are always tough, and the democrats today backing donald trump, although insisting that they really fixed a trade agreement that they called fundamentally flawed when trump brought it to them back over the summer. It gives you a sense that politics is still very much alive and well. That is a big deal. We will see a vote through the house next week that clears the way for the senate to possibly vote on that before christmas, although perhaps more likely early next year. That is important for businesses in north america in that it will remove that specter of uncertainty thats been hanging and its future for the past couple of years, since donald trump took office. The second piece is really the more market moving news that we have seen, which is the chinese tariffs. These tariffs december 15 are due to take effect still. They are on smart phones, toys, other consumer favorites. It is about 160 billion dollars in products from china that are on the target list. Said he had ap phase one deal with china that would essentially remove those tariffs, but we still havent seen that firmed up, and we are in the final stages of those negotiations. We are seeing signals from both sides that they need more time, and therefore they expect a delay. We had chinese officials overnight telling our colleagues in beijing that they expect a delay. Weve also heard from sonny perdue, the u. S. Agriculture secretary, who said he thought a delay was likely. Wilbur ross also in an interview saying that he didnt think december 15 was a hard deadline that we should be paying attention to. So a lot of moving targets, a big day in trade, and that is important. Vonnie in some senses, is the president being forced into a corner with all of this rhetoric ongoing . Can he allow these extra tariffs to take effect on sunday . Wouldnt it be a very odd thing to do . Shawn we will see. We do know that the president has not yet made a decision on this, and that that decision will come later this week. Now, hasor a long time been looking for a way out of these tariffs. These are a legacy of the escalation that we saw over the summer that cleared the way for the negotiations, the resumption of negotiations, focused on an interim or partial deal to stop any further escalation. The reason that hes been trying to back away is that hes got a lot of advisors around him, and a lot of people in the business community, wording that these would be a huge disruption for the u. S. Economy going into an year. On as we have seen today with the usmca, donald trump likes to do deals. He still wants to do a deal with china, it appears, rather than escalate things further. Vonnie larry kudlow is speaking at a wall street journal event right now. Some of the headlines crossing, he says that the reality is december 15 tariffs are still on the table, and there is no definitive decision. So as you say, we are still counting down to that day, and we will see if it happens or not. Back to the usmca for a moment because nancy pelosi did laud it as something revolutionary, if you like. She talked about the lack of enforceability in previous agreements, and said that was fixed this time around and is now a template for future agreements. What agreements might we be referring to . Might we see another round of renegotiations . Shawn i dont think she is talking about the usmca, but there are other negotiations out there. Theres an ongoing negotiation with japan. President trump and Boris Johnson in the u. K. Have talked about the possibility of a u. K. U. S. Trade agreement. Donald trump i mean, none of this is going to happen in Donald Trumps first term. We have an election next year. But there is no doubt that what nancy pelosi is talking about here today is a very different kind of trade agreement. Theres a lot more protections in here for u. S. Industry and for u. S. Workers, which is something the democrats have pushed for. Weve got another remarkable endorsement today from the head of the aflcio, richard trumka, who has been someone who has made a career of criticizing nafta, and here he is endorsing its successor today. So it is a big day in trade, and the change for trade policy. We will still have to wait and see what that means for future trade agreements, but this is a very different trade agreement. Vonnie thank you for that. I do want to point out that mexican stocks are rising. We are not seeing a huge impact in currencies as of now. The mexican peso is relatively steady versus the u. S. Dollar, but mexican stocks are rising right now. U. S. Markets are paring gains on Larry Kudlows comments that there is no definitive decision yet on the december 15 tariffs. He did also mentioned that on the chinese side, rolling back some of the current tariffs is definitely one of the only things on the table, as we already knew. Lets get to these now and other geopolitical events affecting markets. Patrickus in london is armstrong, cio of plurimi wealth. We havent even gotten to the fed statement and the ecb later this week. Monetary policy obviously more of a direct impact on markets then perhaps trade. What are you particularly watching for this week . Patrick this week it is trade and the fed. Probably the biggest driver of the Fourth Quarter rally is what the fed is calling nonqe. Theyve been adding 75 billion dollars to their Balance Sheet everyday since september, and that has added ample liquidity to markets. When youve got liquidity in the markets with no yield on bonds, that money flows into equities, so that has pushed multiples higher. I think the headwind comes from the risks from trade, and if we are meeting progress, and we seem to be making progress on trade, we may get an extension from the 15th tariffs, pushing that out to next year, i think that we lose one of the headwinds for equities. So the path of least resistance probably higher for equities, but still very expensive, particularly in the united states. Vonnie what does that mean going into the end of the year . We are just a couple of weeks away from the final trading sessions. Would you be trading at this point, or picking up profits wherever you can . Patrick we are trading. We are selling some profits weve got on american companies, and been adding that to japan as our preferred region. The s p 500 is trading at 13. 5 ebitda. Lue to multiplen was the same the s p 500 and japan fell to in 2009, so allocating to countries that arent trading at alltime highs. Japan we thing is going to be very good, as good as anywhere else in the world. Youve got the olympics coming up that might draw attention to Japanese Equities as well. Annie the ecb obviously point of focus, and Christine Lagarde is going to be making a state and about Monetary Policy, and probably reference fiscal policy in europe as well. What will be the biggest driver for european markets into next year . Patrick the one thing i think europe might not get enough positive attention about is actually wage growth is relatively strong in europe. 2. 6 , looking at 2. 5 , which is a bit behind the u. S. At 3. 1 , but there is less inflation in europe, so real wage growth is actually quite strong. That may provoke some consumption. European culture, german citizens dont spend as much as maybe north american citizens do, but that is one area where europe can surprise to the upside. Christine lagarde is going to have to use all of her political skills at basically trying to unlock some fiscal stimulus. Draghi said over and over again that Monetary Policy is at the point where it is losing its effectiveness. Christine lagarde will be aware of that, and pumping some form of fiscal stimulus from the countries that can afford it will be the key driving european recovery. Vonnie how much will germany be on board . At what do we actually see these countries putting their money literally where their mouth is our . Are . Ere their mouths patrick it is difficult to tell. You will see governments financing some green projects, environmental technologies. I think there is a political will to bend on things that can improve the environment and technologies there. But as a culture and by law in germany, you cant run those deficits. The company is teetering on recession. It has been all throughout this year. Next year it might improve a little bit if we get a trade deal, but if we dont get a deal between the u. S. And china, or if trump turns his attention to europe, that would probably be a catalyst it would not allow the worstcase scenarios to happen. You would probably have some fiscal offset intermediate there is a big trade negative. Have to ask you vonnie vonnie about the u. K. Election. British pound vonnie have to ask you vonnie have to ask you about the u. K. Election. British pound up against the u. S. Dollar. What happens in the election . Patrick we think it is a reasonable possibility you end up with a Hung Parliament or some kind of coalition. The polls right now are indicating a conservative more dirty a conservative majority. It is very difficult to say. Base case, we trust the polls come but take it with a grain of salt. Conservative majority slight positive for the pound, but we think it is premuch priced and now. Vonnie thank you for all of that. That is patrick armstrong, cio at plurimi wealth, joining us from our london studios. Lets get a check on global markets. Heres kailey leinz. Kailey its been quite an interesting session. Investors really getting whipped with every headline as they weigh the usmca trade deal and a fed decision tomorrow. The s p 500 is holding onto a marginal gain, up less than 0. 1 percent, while the dow has plunged into the red by four points. The nasdaq is still higher by about 0. 25 , while the stoxx in europe is down by about that much. If we look at an intraday chart of s p 500 futures, we were in positive territory, then deeply negative before the market opened in the u. S. We got a big leg higher on a report that china think the u. S. Will delay those tariffs set to take effect over the weekend, but that was put a little cold water on by mick mulvaney, the president s chief of staff, who said that pins on how talks go. We did see a leg lower on Larry Kudlows comments saying there has been no decision made on those tariffs, but so far, the bull has been prevailing. What is leading those gains at the moment our technology stocks, specifically semiconductors, which we know are heavily exposed to china. You are now looking at the stocks index up by the better part of 1 . The better performers include Nxp Semiconductors and micron. I want to push forward as to what we can see into the end of year. Take a look at gtv. On the top panel is the weekly move in the vix index, everybodys favorite stocks fear gauge, and on the bottom is the moves within the s p 500. For the past two weeks, these two have moved up together in tandem. The last time they moved up two can take it weeks was in may, and that was followed by a 7 decline in the s p 500, so it could be a foreboding signal going into the end of year. Vonnie thank you for that. That is kailey leinz with our market check. Do remember the function gtv on your bloomberg. It allows you to browse all of the charts featured on bloomberg tv, catch up on key analysis, save your favorites for future reference. This is bloomberg. York, imve from new vonnie quinn. This is the european close on bloomberg markets. Lets check in on the bloomberg first word news. Heres courtney donohoe. Courtney democrats of unveiled two articles of impeachment against President Donald Trump on abuse of power and obstruction of congress. Rep. Nadler President Trump engaged in unprecedented, categorical, and indiscriminate defiance of the impeachment inquiry. Courtney the full house could vote on impeaching the president next week. President trump has harsh words for fbi director Christopher Wray after the release of the federal watchdog report on the origins of a probe in foreign meddling in the 2016 election. Wray said the Inspector General didnt find political bias in the investigation. Trump said with that kind of attitude, he would never be able to fix the fbi. Up to 14 people now feared dead in that volcano eruption off the coast of new zealand. Six people are known to have died. Eight others are missing or fear dead. Planes have flown over the volcano on white island, and have seen no signs of life. The british economy unexpectedly stagnated in october. That marks three months in a row of no growth for the First Time Since 2009. Gdp was unchanged following two consecutive months of decline. Output was dragged down by a steep drop in construction. Some of that was blamed on bad weather. Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. Im courtney donohoe. This is bloomberg. Vonnie thank you. As we just heard, House Democrats today announcing two articles of impeachment against President Donald Trump, charging him with abuse of power and obstructing efforts to investigate his dealings with ukraine. Joining us from washington is bloombergs Anna Edgerton. What reaction have we had from the white house so far . The white house has dismissed this process as illegitimate and baseless. They have said the democrats have no viable candidate for 2020, and that is why they are Going Forward with this process. , kratz say they have been left no choice by the president s actions democrats say they have been left no choice i the president s actions, and say they have to hold the president accountable for his actions in ukraine. Vonnie the senate seems to have cleared its calendar for january, which would indicate that is what the senate will be up to in january. What does that mean for the rest of the legislating calendar . Anna under the constitution, Everything Else has to stop during an impeachment process. The senate will be at work six days a week on the impeachment process, which means that the five democrat senators running for the 2020 nomination are going to be stuck here in washington rather than on the campaign trail. The senate will also have to consider the usmca, the revamped nafta deal which the house has to pass by next week, so they could try to slip that in before impeachment. If not, it could get stuck until after the impeachment process. Ofnie one of the effects this is that they might not get more legislation done, but that the senators will be in washington, d. C. As opposed to on the campaign trail. Could that have an effect on the elections . Anna absolutely. It is definitely a handicap for the senators who will be here. They have said they will do video town halls, try to send out surrogates to stay in touch with voters, especially in crucial early states like iowa, new hampshire, and south carolina. It is unclear how long they would be stuck here. The best estimate is six to eight weeks. But if the Trump Administration presents a really robust events, that could drag on robust defense, that could drag on ungur. Vonnie for whom is this process good . Even if the president is tried and it is decided he should be removed from office, first of all, is that even a realistic scenario . Short of that, who benefits from this . Anna to answer your second question, no, it is very unlikely that the president would be removed from office. To remove him from his office, that would take a 2 3 majority in the senate, which would mean 23 republican senators crossing over against the resident, and right now, Senate Majority leader Mitch Mcconnell has said that is inconceivable. It is not really a good thing for anyone. It is not good for democrats because democrats have to prove they are doing more than just investigating the president. I guess the only argument that this is good for the constitution if you do believe that the president has committed such a grave offense that he has violated his oath that he took as president. That is the only reason to go forward with this, to hold him accountable for that, because impeachment really is the only consequent for a sitting president. Vonnie thank you for all of that. That is bloombergs Anna Edgerton in washington. This is bloomberg. Vonnie live from new york, im vonnie quinn. This is the european close on bloomberg markets. It is time for your Bloomberg Business flash. Is in a closely watched fraud trial in the u. S. Accuses the state of being swayed by environmentalists and billionaires who want to vilify exxon. Deutsche bank turning to its Investment Bank with its biggest Restructuring Plan in decades. Fixed income trading is up this court or from last year, so it has raised the outlook for its securities business. I am positive, and i am encouraged with the moment and we have. I think we took Swift Management action in the Investment Bank to focus on our key strengths, and that seems to pay off. Vonnie christian sewing, the ceo, there. Ofannounced plans to cut 1 5 the workforce. Optimism is rising among House Democrats<\/a> said they will back the usmca trade deal and are planning a vote next week. Rep. Pelosi there is no question that this trade agreement is much better than nafta, but in terms of our work here, it is infinitely better than what was initially proposed by the administration. Vonnie House Democrats<\/a> declaring a win there. For more, lets bring in bloomberg trade reporter shawn donnan in washington. Todays developments on the trade front, how incremental are they . Shawn i think we got one really important big step on usmca. It is a remarkable day in what is a highly partisan washington, when we see a bipartisan agreement on a trade deal. Trade politics are always tough, and the democrats today backing donald trump, although insisting that they really fixed a trade agreement that they called fundamentally flawed when trump brought it to them back over the summer. It gives you a sense that politics is still very much alive and well. That is a big deal. We will see a vote through the house next week that clears the way for the senate to possibly vote on that before christmas, although perhaps more likely early next year. That is important for businesses in north america in that it will remove that specter of uncertainty thats been hanging and its future for the past couple of years, since donald trump took office. The second piece is really the more market moving news that we have seen, which is the chinese tariffs. These tariffs december 15 are due to take effect still. They are on smart phones, toys, other consumer favorites. It is about 160 billion dollars in products from china that are on the target list. Said he had ap phase one deal with china that would essentially remove those tariffs, but we still havent seen that firmed up, and we are in the final stages of those negotiations. We are seeing signals from both sides that they need more time, and therefore they expect a delay. We had chinese officials overnight telling our colleagues in beijing that they expect a delay. Weve also heard from sonny perdue, the u. S. Agriculture secretary, who said he thought a delay was likely. Wilbur ross also in an interview saying that he didnt think december 15 was a hard deadline that we should be paying attention to. So a lot of moving targets, a big day in trade, and that is important. Vonnie in some senses, is the president being forced into a corner with all of this rhetoric ongoing . Can he allow these extra tariffs to take effect on sunday . Wouldnt it be a very odd thing to do . Shawn we will see. We do know that the president has not yet made a decision on this, and that that decision will come later this week. Now, hasor a long time been looking for a way out of these tariffs. These are a legacy of the escalation that we saw over the summer that cleared the way for the negotiations, the resumption of negotiations, focused on an interim or partial deal to stop any further escalation. The reason that hes been trying to back away is that hes got a lot of advisors around him, and a lot of people in the business community, wording that these would be a huge disruption for the u. S. Economy going into an year. On as we have seen today with the usmca, donald trump likes to do deals. He still wants to do a deal with china, it appears, rather than escalate things further. Vonnie larry kudlow is speaking at a wall street journal event right now. Some of the headlines crossing, he says that the reality is december 15 tariffs are still on the table, and there is no definitive decision. So as you say, we are still counting down to that day, and we will see if it happens or not. Back to the usmca for a moment because nancy pelosi did laud it as something revolutionary, if you like. She talked about the lack of enforceability in previous agreements, and said that was fixed this time around and is now a template for future agreements. What agreements might we be referring to . Might we see another round of renegotiations . Shawn i dont think she is talking about the usmca, but there are other negotiations out there. Theres an ongoing negotiation with japan. President trump and Boris Johnson<\/a> in the u. K. Have talked about the possibility of a u. K. U. S. Trade agreement. Donald trump i mean, none of this is going to happen in Donald Trumps<\/a> first term. We have an election next year. But there is no doubt that what nancy pelosi is talking about here today is a very different kind of trade agreement. Theres a lot more protections in here for u. S. Industry and for u. S. Workers, which is something the democrats have pushed for. Weve got another remarkable endorsement today from the head of the aflcio, richard trumka, who has been someone who has made a career of criticizing nafta, and here he is endorsing its successor today. So it is a big day in trade, and the change for trade policy. We will still have to wait and see what that means for future trade agreements, but this is a very different trade agreement. Vonnie thank you for that. I do want to point out that mexican stocks are rising. We are not seeing a huge impact in currencies as of now. The mexican peso is relatively steady versus the u. S. Dollar, but mexican stocks are rising right now. U. S. Markets are paring gains on Larry Kudlows<\/a> comments that there is no definitive decision yet on the december 15 tariffs. He did also mentioned that on the chinese side, rolling back some of the current tariffs is definitely one of the only things on the table, as we already knew. Lets get to these now and other geopolitical events affecting markets. Patrickus in london is armstrong, cio of plurimi wealth. We havent even gotten to the fed statement and the ecb later this week. Monetary policy obviously more of a direct impact on markets then perhaps trade. What are you particularly watching for this week . Patrick this week it is trade and the fed. Probably the biggest driver of the Fourth Quarter<\/a> rally is what the fed is calling nonqe. Theyve been adding 75 billion dollars to their Balance Sheet<\/a> everyday since september, and that has added ample liquidity to markets. When youve got liquidity in the markets with no yield on bonds, that money flows into equities, so that has pushed multiples higher. I think the headwind comes from the risks from trade, and if we are meeting progress, and we seem to be making progress on trade, we may get an extension from the 15th tariffs, pushing that out to next year, i think that we lose one of the headwinds for equities. So the path of least resistance probably higher for equities, but still very expensive, particularly in the united states. Vonnie what does that mean going into the end of the year . We are just a couple of weeks away from the final trading sessions. Would you be trading at this point, or picking up profits wherever you can . Patrick we are trading. We are selling some profits weve got on american companies, and been adding that to japan as our preferred region. The s p 500 is trading at 13. 5 ebitda. Lue to multiplen was the same the s p 500 and japan fell to in 2009, so allocating to countries that arent trading at alltime highs. Japan we thing is going to be very good, as good as anywhere else in the world. Youve got the olympics coming up that might draw attention to Japanese Equities<\/a> as well. Annie the ecb obviously point of focus, and Christine Lagarde<\/a> is going to be making a state and about Monetary Policy<\/a>, and probably reference fiscal policy in europe as well. What will be the biggest driver for european markets into next year . Patrick the one thing i think europe might not get enough positive attention about is actually wage growth is relatively strong in europe. 2. 6 , looking at 2. 5 , which is a bit behind the u. S. At 3. 1 , but there is less inflation in europe, so real wage growth is actually quite strong. That may provoke some consumption. European culture, german citizens dont spend as much as maybe north american citizens do, but that is one area where europe can surprise to the upside. Christine lagarde is going to have to use all of her political skills at basically trying to unlock some fiscal stimulus. Draghi said over and over again that Monetary Policy<\/a> is at the point where it is losing its effectiveness. Christine lagarde will be aware of that, and pumping some form of fiscal stimulus from the countries that can afford it will be the key driving european recovery. Vonnie how much will germany be on board . At what do we actually see these countries putting their money literally where their mouth is our . Are . Ere their mouths patrick it is difficult to tell. You will see governments financing some green projects, environmental technologies. I think there is a political will to bend on things that can improve the environment and technologies there. But as a culture and by law in germany, you cant run those deficits. The company is teetering on recession. It has been all throughout this year. Next year it might improve a little bit if we get a trade deal, but if we dont get a deal between the u. S. And china, or if trump turns his attention to europe, that would probably be a catalyst it would not allow the worstcase scenarios to happen. You would probably have some fiscal offset intermediate there is a big trade negative. Have to ask you vonnie vonnie about the u. K. Election. British pound vonnie have to ask you vonnie have to ask you about the u. K. Election. British pound up against the u. S. Dollar. What happens in the election . Patrick we think it is a reasonable possibility you end up with a Hung Parliament<\/a> or some kind of coalition. The polls right now are indicating a conservative more dirty a conservative majority. It is very difficult to say. Base case, we trust the polls come but take it with a grain of salt. Conservative majority slight positive for the pound, but we think it is premuch priced and now. Vonnie thank you for all of that. That is patrick armstrong, cio at plurimi wealth, joining us from our london studios. Lets get a check on global markets. Heres kailey leinz. Kailey its been quite an interesting session. Investors really getting whipped with every headline as they weigh the usmca trade deal and a fed decision tomorrow. The s p 500 is holding onto a marginal gain, up less than 0. 1 percent, while the dow has plunged into the red by four points. The nasdaq is still higher by about 0. 25 , while the stoxx in europe is down by about that much. If we look at an intraday chart of s p 500 futures, we were in positive territory, then deeply negative before the market opened in the u. S. We got a big leg higher on a report that china think the u. S. Will delay those tariffs set to take effect over the weekend, but that was put a little cold water on by mick mulvaney, the president s chief of staff, who said that pins on how talks go. We did see a leg lower on Larry Kudlows<\/a> comments saying there has been no decision made on those tariffs, but so far, the bull has been prevailing. What is leading those gains at the moment our technology stocks, specifically semiconductors, which we know are heavily exposed to china. You are now looking at the stocks index up by the better part of 1 . The better performers include Nxp Semiconductors<\/a> and micron. I want to push forward as to what we can see into the end of year. Take a look at gtv. On the top panel is the weekly move in the vix index, everybodys favorite stocks fear gauge, and on the bottom is the moves within the s p 500. For the past two weeks, these two have moved up together in tandem. The last time they moved up two can take it weeks was in may, and that was followed by a 7 decline in the s p 500, so it could be a foreboding signal going into the end of year. Vonnie thank you for that. That is kailey leinz with our market check. Do remember the function gtv on your bloomberg. It allows you to browse all of the charts featured on bloomberg tv, catch up on key analysis, save your favorites for future reference. This is bloomberg. York, imve from new vonnie quinn. This is the european close on bloomberg markets. Lets check in on the bloomberg first word news. Heres courtney donohoe. Courtney democrats of unveiled two articles of impeachment against President Donald Trump<\/a> on abuse of power and obstruction of congress. Rep. Nadler President Trump<\/a> engaged in unprecedented, categorical, and indiscriminate defiance of the impeachment inquiry. Courtney the full house could vote on impeaching the president next week. President trump has harsh words for fbi director Christopher Wray<\/a> after the release of the federal watchdog report on the origins of a probe in foreign meddling in the 2016 election. Wray said the Inspector General<\/a> didnt find political bias in the investigation. Trump said with that kind of attitude, he would never be able to fix the fbi. Up to 14 people now feared dead in that volcano eruption off the coast of new zealand. Six people are known to have died. Eight others are missing or fear dead. Planes have flown over the volcano on white island, and have seen no signs of life. The british economy unexpectedly stagnated in october. That marks three months in a row of no growth for the First Time Since<\/a> 2009. Gdp was unchanged following two consecutive months of decline. Output was dragged down by a steep drop in construction. Some of that was blamed on bad weather. Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. Im courtney donohoe. This is bloomberg. Vonnie thank you. As we just heard, House Democrats<\/a> today announcing two articles of impeachment against President Donald Trump<\/a>, charging him with abuse of power and obstructing efforts to investigate his dealings with ukraine. Joining us from washington is bloombergs Anna Edgerton<\/a>. What reaction have we had from the white house so far . The white house has dismissed this process as illegitimate and baseless. They have said the democrats have no viable candidate for 2020, and that is why they are Going Forward<\/a> with this process. , kratz say they have been left no choice by the president s actions democrats say they have been left no choice i the president s actions, and say they have to hold the president accountable for his actions in ukraine. Vonnie the senate seems to have cleared its calendar for january, which would indicate that is what the senate will be up to in january. What does that mean for the rest of the legislating calendar . Anna under the constitution, Everything Else<\/a> has to stop during an impeachment process. The senate will be at work six days a week on the impeachment process, which means that the five democrat senators running for the 2020 nomination are going to be stuck here in washington rather than on the campaign trail. The senate will also have to consider the usmca, the revamped nafta deal which the house has to pass by next week, so they could try to slip that in before impeachment. If not, it could get stuck until after the impeachment process. Ofnie one of the effects this is that they might not get more legislation done, but that the senators will be in washington, d. C. As opposed to on the campaign trail. Could that have an effect on the elections . Anna absolutely. It is definitely a handicap for the senators who will be here. They have said they will do video town halls, try to send out surrogates to stay in touch with voters, especially in crucial early states like iowa, new hampshire, and south carolina. It is unclear how long they would be stuck here. The best estimate is six to eight weeks. But if the Trump Administration<\/a> presents a really robust events, that could drag on robust defense, that could drag on ungur. Vonnie for whom is this process good . Even if the president is tried and it is decided he should be removed from office, first of all, is that even a realistic scenario . Short of that, who benefits from this . Anna to answer your second question, no, it is very unlikely that the president would be removed from office. To remove him from his office, that would take a 2 3 majority in the senate, which would mean 23 republican senators crossing over against the resident, and right now, Senate Majority<\/a> leader Mitch Mcconnell<\/a> has said that is inconceivable. It is not really a good thing for anyone. It is not good for democrats because democrats have to prove they are doing more than just investigating the president. I guess the only argument that this is good for the constitution if you do believe that the president has committed such a grave offense that he has violated his oath that he took as president. That is the only reason to go forward with this, to hold him accountable for that, because impeachment really is the only consequent for a sitting president. Vonnie thank you for all of that. That is bloombergs Anna Edgerton<\/a> in washington. This is bloomberg. Vonnie live from new york, im vonnie quinn. This is the european close on bloomberg markets. It is time for your Bloomberg Business<\/a> flash. Is in a closely watched fraud trial in the u. S. Accuses the state of being swayed by environmentalists and billionaires who want to vilify exxon. Deutsche bank turning to its Investment Bank<\/a> with its biggest Restructuring Plan<\/a> in decades. Fixed income trading is up this court or from last year, so it has raised the outlook for its securities business. I am positive, and i am encouraged with the moment and we have. I think we took Swift Management<\/a> action in the Investment Bank<\/a> to focus on our key strengths, and that seems to pay off. Vonnie christian sewing, the ceo, there. Ofannounced plans to cut 1 5 the workforce. Optimism is rising among Small Business<\/a> owners in the united states, according to the National Federation<\/a> of an up and it business. More business of of independent business. Or Business Owners<\/a> say profit is up and it is a good time for expansion. That is your latest Bloomberg Business<\/a> flash. Lets check u. S. Markets now. Lots of News Headlines<\/a> this morning, but overall, indices are relatively unchanged. The dow down a point, the s p up just or than a point, and the nasdaq up 0. 2 . The vix below 16. In europe, just france and italy right now are higher. We have the dax in Germany Office<\/a> its lows, but down about down 0. 2 the ftse 100 as well. Some negative data out of the ukase adjusting the economy is stagnating, at least in the most recent quarter. This is bloomberg. Here, it all starts with a simple. Hello hi how can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone wifi up there . Uhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your local xfinity store today. Beyond the routine checkups. Beyond the notsoroutine cases. Comcast business is helping doctors provide care in whole new ways. All working with a new generation of technologies powered by our gigspeed network. Because beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected. To do the extraordinary. Take your business beyond. Vonnie coming up on the european close. Most of the major indices are in the red. A couple of standouts, including the cac 40 in paris, up. 1 . Italy is also higher and spain. Rest of the major indices reacting to softer data, Economic Data<\/a> or forecasting data. We also have data on Grocery Store<\/a> chains and so on that is weighing on those indices. Thats look at some of the individual indices. The ftse 100 off its lows but finishing the decade down point finessing the day down white 25 . 5 . Dation down data suggesting economy in britain is stagnating. Grocery store stopping grocery short Grocery Store<\/a> shopping is soft. Airlines possibly responsible, the big announcement of a greenville package in europe and the airlines will suffer from that. It remains to be seen whether taxes imposed by europe will be adopted by the airlines to pass on to customers. As of right now, they are reacting negatively to that. The cac 40 still up. 1 . Said it willover get out of diabetes and Heart Research<\/a> and stick with things like cancer research. The drug therapies have a wider margin. Up for one of the best performances in the stoxx 600. Major one of many major European Airlines<\/a> lower. Supermarkets down 2. 9 , showing perhaps the consumer is not spending as much of the supermarket. The british pound is not moving much right now. Give it another couple of days. We will see what happens. It is trading at 1. 3175. Lets take a look at where we stand in the u. S. Points,500 up three 3138, still up. 1 . The 10 year yield has moved 1. 84d, but it is around where it has been for some time. Currency volatility is extraordinarily low, given everything that is going on, including passage of usc mie of usmca next week, the signing up at by the three countries today according to the mexican president , and incremental moves by china. Lets have a look at a couple of u. S. Stocks on the move. You see autozone is the best. Erformer, up 7. 25 suppliers are also doing well. Advanced auto parts, for example. A great set of earnings out of autozone has people pleased. We have a couple of Technology Companies<\/a> doing well. Some ofownside, we have the insurers and health care providers. Cigna and cbs two cigna and cvs two of the worst performers. Medicare part d likely to have an impact on the company. Deutsche bank ceo trying to convince shareholders his strategy is on track. He says he is encouraged by Bank Momentum<\/a> but warns of headwinds from lower rates. He speak he spoke with bloomberg earlier in frankfurt. We have seen in august and september the furthering decrease with regards to the Interest Rates<\/a>. A conservative management has to take that into account. We talked swift action in terms of passing on negative rates to our clients, in particular on the corporate side but also in the ultra high. We have initiated other mitigating action. We see from the first five months in this bank how much potential is there on the revenue side, but also on the cost side. All in all, looking down the road for the next three years, we are hitting all the goals and the first five months. The comfort we can achieve despite these challenges, our 8 return on equity in 2022, therefore, we are confident we can achieve that, recognizing clearly the challenges but with the track record we have, we have seen no reason to adjust. You talk about passing on the costs and in the release you say youve taken substantial measures to offset negative rates. Can you elaborate on what those measures are . Flower ofind of a measures. Three or four weeks ago we started to pass on negative Interest Rates<\/a> to certain client segments on the corporate side or the ultrahigh net worth. We focus far more on an optimized advisory for our clients to change deposits into other investments until we have been every successful. The inflows we have in Wealth Management<\/a> but also in the private banking. A lot of good work has been done , also to make sure our clients are benefiting. We do get benefits from the ecb tearing and we have started to increase the one or the other loan books segment in order to offset. Mitigatinglower of measures and it shows us there is potential to offset. Vonnie Deutsche Bank<\/a> ceo christian sewing speaking with matt miller earlier. We are joined now by bloombergs steven arons in frankfurt. What was new about what christian was saying today . N it was not a revolutionary announcement, but he made clear how difficult it is to achieve the revenue target. He put a bigger question mark over the profitability target and reaffirmed the 2022 profitability target, he also said it is becoming more ambitious to achieve it because Interest Rates<\/a> make it harder to make money in the euro area. That is becoming a bigger problem for Deutsche Bank<\/a>. He said their intensifying efforts to pass on the negative rates and still hope to offset that impact from the ecb Interest Rates<\/a>. Vonnie exactly. He did talk about pinning more growth hope on the Investment Bank<\/a>. Why now, and one of the job cuts we are anticipating from that portion of the bank . Steven that was a very interesting element of todays presentation. The Investment Bank<\/a> has long been the problem child of Deutsche Bank<\/a>. They have tried for many years to turn it around. Now they are reporting positive momentum in that position. It seems that this has given them confidence to say it will grow. Back in july when they first unveiled a Restructuring Program<\/a> , they only saw 0 , no growth in that division, and they have increased that to 2 . This means they will probably invest more in the bank. The Investment Bank<\/a> said later on that the front office cuts in this division are largely over. Steven arons in frankfurt, thank you for that. And the u. K. , the election is in the final couple of days. Boris johnson says brexit will not happen unless his stories when. Unless his tories win. With the latest is bloombergs Jess Shankleman<\/a>. The gloves are off, but is it getting any clearer what the outcome of this election will be . Absolutely have to wait until friday morning or late on thursday night in the u. K. To find out what the results are going to be, but interestingly today, bookmakers have shown an increasing number of people betting on there being a Hung Parliament<\/a> after Boris Johnson<\/a> had a particularly bad day yesterday over his reaction to the crisis in the National Health<\/a> service. Today they are trying to get back on the front foot, criticizing labor. Everything to play for in the final few days as undecided voters try to make up their minds about whether they vote with their hearts or their heads. Vonnie normally elections are on issues. This time around it seems like brexit has been so dominant for the last three years that some of the issues have not been as important for those campaigning. That is not the case today. Jeremy corbyn is going hard with the nhs. Will that be the deciding factor or will brexit stay the deciding factor . Jess youre absolutely right. This election is unique. It is almost like a second referendum done through the guys of a general election. That is confusing because in a referendum one persons boat leads to one resolved, whereas one persons vote leads to one resolved, whereas in the u. K. System people are looking to voting tactically to work out ways of stopping a conservative brexit plan or whether that might mean holding their nose and voting for a party they would not usually support. Toemy corbyn has been trying turn the conversation away from brexit because brexit has traditionally been a story the conservative party has touted is is where Boris Johnson<\/a> strong and Jeremy Corbyn<\/a> is seen as weak. Vonnie seems like it is leading to a lot of infighting in the parties. Even the liberal democrats seem to be fighting, a leader of the party criticizing someone for saying something untoward to her. Parliament,a hung does brexit remain the only issue on the table for that next andrnment or does the nhs other issues get looked at . Issue ofxit is the this election. It is true that united parties tend to attract more voters because voters are attracted to parties who seem like theyre going together and in one particular direction. What Boris Johnson<\/a> does seem to do is appear like the tory party is united. Whether or not that unification continues to hold if he wins remains to be seen. Vonnie exactly. Thank you. That is bloombergs Jess Shankleman<\/a> in london. Tune into our special coverage of thursdays u. K. Election after the polls close. Anna edwards, guy johnson, and Jonathan Ferro<\/a> would bring you the latest after the polls close at 5 00 eastern time and 10 00 p. M. In london. Lets check in on first word news. Courtney House Democrats<\/a> of introduced two articles of impeachment against President Trump<\/a>. He is accused of abuse of power and obstruction of congress. The argument why dont you just wait amounts to this why dont you let him cheat in one more election . Why not let him cheat one more time . Why not let him have foreign help one more time . Judiciarythe committee will vote on articles of impeachment thursday and that steps the stage for a vote by the full house next week. Nancy pelosi gave President Trump<\/a> a major win on capitol hill and announced there is an agreement on a modified trade deal between the u. S. , mexico, and canada. She called it a victory for americas workers. President trump tweeted the agreements we get rid of what he calls the countrys worst trade deal, nafta. Chinese officials expect the u. S. To delay a threatened tariff increase at for sunday. Bloomberg has learned both sides will work on cutting import taxes in place and that will avoid negotiators having to choose which among thousands of products can be exempted. White house Economic Advisor<\/a> larry kudlow said he cannot confirm any tariff delay. Those tariffs are still on the table. Remain,hort strokes negotiations do not pan out to his liking, those tariffs could go back into place. They could not, but they also could. There is no definitive decision on that. Courtney since last year the u. S. Has added 25 on 250 billion of chinese goods and a 15 on another 110 billion of imports. Global news 24 hours a day, on air and on quick take by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. I am courtney donohoe. This is bloomberg. Vonnie lets check where european stocks have settled the session. 40 up. 2 , mainly thanks to sanofi, the drugmaker. The dax down about. 25 and the ftse 100 down. 33 . The ftse may been italy was the best performer in europe, up. 7 on the day. This is bloomberg. Vonnie time for the bloomberg quicktake. House and Senate Negotiators<\/a> have reached a tentative agreement to spun face force, the first new ministry to fund space force. It will be the first new Ministry Service<\/a> in seven decades. The pentagon has called for aggressive capabilities to defend u. S. Interest in space, that would include systems to disrupt and destroy an enemys capabilities. Space force would sit in the air force, similar to how the marine force sits in the navy. The main threat to the u. S. Is the ability to disable satellites from the ground. In 2007, satellite used a missile to destroy one of its old satellites. Destroying us by satellite means the flow of realtime intelligence from a place shuts off. U. S. Intelligence has been working on ways to protect satellites from space. Some in congress are calling for weapons that could destroy Ballistic Missiles<\/a> from space. That is todays quicktake. Our stock of the hour is netflix. Ld on the golden globe nominations did nothing to offset one analysts concern. Taylor riggs has more. Taylor we are hearing from the analyst at needham, downgrading the stock to underperform saying the company is at risk of losing 4 million subscribers if they do not create a lower Pricing Service<\/a> supported more by ad revenue. I want to take a look at the share prices of disney process of the disney plus launch. They have been the clear outperform her. Netflix plans have not changed. Action from needham today means there are 29 buys, sellsds, and seven on the stock. Hoping lowerpriced add supporting revenue, if the company were to come out with that, would support the Balance Sheet<\/a>. Apple and disney have been some of the cheaper options. Netflix most popular Monthly Service<\/a> is 13 a month. Has been the more expensive option. A lot of people are prepared to see how netflix continues to do as we see the heating up in the streaming wars. Vonnie how has subscriber growth in it netflix relative to peers . Taylor in the u. S. You saw growth slow last quarter. That has been concern, given that a lot of the growth has been on the international front. Analysts hoping maybe this would help turn that around, given more and more competition is heating up. Domestic users are more profitable. You will need to see that grow relative to the international subscribers. Vonnie thank you. That is taylor riggs. She will be back on bloomberg tv at 5 00 eastern from San Francisco<\/a> with bloomberg technology. Coming up as our global battle of the charts. This is bloomberg. Vonnie time for our global but of the charts. You can see them on the bloomberg by running gtv. Kicking things off is ritika gupta. Ritika my chart shows the u. S. Is getting the upper hand over china in the trade war. The shanghai composite relative to the s p 500. You can see the downward trend, the yellow line, over the past years. If we go back to march, chinese shares outperformed u. S. Shares in a big way. They have struggled to find momentum. U. S. Shares have soared. Why the switch this year . Trade is obviously a big factor, but it is also the diverging Monetary Policy<\/a> stances. The feds dovish tilt has supported u. S. Stocks but in china they are taking a more prudent approach to stimulus. With the u. S. President ial election next year and the fed indicating it is in no rush to cut rates further, markets could be volatile in 2020. It will be interesting to monitor the direction of this white lie next year in relation to the yellow trendline. If it goes above the yellow line it could be quite a bullish signal for chinese stocks. You can check out my chart on gtv. Onnie ritika gupta a phenomenal chart and a phenomenal presentation. A hard act to follow. Follow we will. Bloombergs john hyland. John i am looking at the s p 500 and the vix index. They have been moving in tandem. 80 of the time they move in opposite directions. You can see the top panel is the weekly change in the vix index and the bottom panel is the weekly percent change in the s p 500 and the blue line is the s p 500 index level. Citigroup had two strategist writing one technical indicator shows the vix index is pointing higher. In may you saw the s p and the vix moving in tandem and it was followed by a 7 decline in the s p 500. You can see this four red bars. The s p has been trading within points of its record highs. It is just under 1 and youve had 38 trading days without it going higher or lower by 1 . Something to keep an eye on. Tomorrow you have the fomc Rate Decision<\/a> and sunday the looming tariff deadline for the u. S. To impose new tariffs on chinese goods. Something to keep an eye on as there are a lot of market catalysts. You can find the chart by running gtv. Vonnie indeed you go. I will be going back to gtv after this and having a look at both of the charts. Something tells me the standard is getting higher and higher. It is so high today that im going toward a tie. Both ritika gupta and john hyland when todays battle of the charts. Congratulations to you both. Do not overdo the celebrations. Coming up in the united states, we have balance of power with david westin on Bloomberg Television<\/a> and radio. He will be speaking with the director general of the wto Roberto Azevedo<\/a> after his press conference. This is bloomberg. David from bloomberg World Headquarters<\/a> in new york to our tv and radio audiences worldwide, i am david westin. Welcome to balance of power, where the world of politics meets the world of business. On the brief today, Josh Wingrove<\/a> from washington on democrats moving forward on the nafta successor agreement. On nancy pelosi moving forward on impeachment, and from london to raise rafael on the last days of their prison election. Teresa rafael on the last days of the british election. Sh the three countries are about to sign in about an hour and this clears the way for a vote next week in congress. All expectations are it will pass. We have been going backandforth for quite some time. Nancy pelosi managed to squeeze some changes out of the Trump Administration<\/a>. The administration gets the trade deal, she gets to say she made it better. 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