600 gaining. A lot of the focus is on earnings and the economic backdrop. 1134. Ollar 1 it has fluctuated but is very arrangedbound. Rangebound. Coming up, the World Economic forum in davos. We bring you all the biggest names in banking. Lets get straight to first word news in new york city. We begin with the new york senate approving Donald Trumps new freetrade agreement with mexico and canada. It handles the president and a major win ahead of impeachment. The overhaul of the agreement was a priority for mr. Trump. Mitch mcconnell called vote a rare moment of bipartisan cooperation. The white house broke the law in withholding aid the ukraine. Accordingting to an independent watchdog, saying the president should not have delayed money. This is a key part of the impeachment case against President Trump. , quoteg with them obsessed with the u. S. Trade deficit. This is according to bill hogan, saying americafirst policies are bringing about a priceless moment for global trade. This came during his threeday visit to washington. We must call out the narrative that the United States has an unfair trade relationship with the european union. In reality, the relationship is balanced and mutually beneficial. This cannot be stated enough. The facts are clear. Microsoft wants to go carbonneutral, carbonnegative, rather. They are investing billions to back technology that removes carbon from the atmosphere. It says efforts to merely admit less are not enough emit less are not enough. Global news, 24 hours a day on air, on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Francine . Francine thank you so much. Chinas gdp growth held at 6 , stabilizing after slowing to the weakest pace in almost three decades. Policy reduced pressure and stopped further deterioration. The outlook has much improved. Joining us for more is our Greater China editor. Is the data better than expected . Yes, it is a little. Layarticular the good news in the investment data. Sectorknow, investment in the private sector was sluggish in china. We saw a significant pickup and a lot of it from the manufacturing sector, which tells us a better demand from the Global Economy and probably even better consumption down the line. Francine how much will the trade truce affect that . Defaults have been increasing and concerns about other things. Jeff right. Obviously, a deal was reached in the middle of december. It is pretty difficult to tell how much that would have fed into sentiment so quickly. Obviously, it is a little bit better and would be a better basis for investment. Having said that, is a difficult road. It is not easy and there are already targets to be met. Tensions could flare up at any point, and if it does, you could imagine the investment environment will continue to be needed muted. Francine thanks, jeff. Is the head of Investment Strategy at jp morgan private bank. What does china hold for us this year . Less of a market risk than it was in the previous 18 months. Opportunity to administer diversification of equity exposure. Diversification of the asian market is one of our key themes for our client base. Toughing the market is but has been getting easier all the time. We have dramatically expanded our coverage, fund options, and i think calibrating standard growthe for tremendous focused on consumer and tech is our key agenda in that region. Francine this is a chart looking at the shanghai composite. Market,ook at the stock people have been saying it is divorced from the economy. Shows the annual return is roughly the same as nonmarginal gdp. David the chart shows long times of underperformance and dramatic rallies along the way. , it is at of markets market not to be messed with in terms of how much you want allocated in your equity portfolio. In many countries, we see longrun times of disconnect between the growth rate and equity market. Believe that emergingmarket equities are one of the most promising Public Market segments out there. You just have to invest in the right instruments. You could argue one of the most exciting developments is the ability of private companies and private equity comedies to exit with greater liquidity than they have in the past. It is another reason to engage in the private markets. For us, the growth was more challenging given the lack of the on shore market. Is this so that phase i does not go back to a war of words . David that would help every market in the world. I think one of the key lessons from the last 18 months of trade war has been the impact of such a conflict does not just affect those directly involved. Also, it is focused on some of the capital goods. It has had a Chilling Effect in business confidence. Absolutely, markets and economies could do without that. If we now proceed along the ,mplementation of phase one this is a reasonable success and we can talk about phase two. Francine thank you, david. We are getting breaking news across the bloomberg terminal. We have been following the situation closely. The u. K. Has considered routeszing some of these as the rescue. As part of the rescue. The u. K. Is considering subsidizing these routes as part of the deal struck with the countrysbiggest biggest carrier. Amidst a deferral of passenger duties. We will have more on what that means for flights of ryanair. Next up, phil hogan accuses trump of shortsighted tactics on trade. We will get the latest on his visit to washington. And we will be speaking to the Qatar National bank chief executive. Largest banks in terms of assets under management in the middle east. Dont miss that on sunday. Francine lets get straight to our business flash. Barclays cutting jobs as it seeks to rein in costs. They will mostly be in trading roles across its corporate and investment bank. They are due to report fullyear results in a february february. Bayer is close toclaims, almostt settled into september. No details on the possible terms of the settlement. Alphabet joins apple and microsoft, solidifying the tech giants as the biggest giants of wall street. That is your Bloomberg Business flash. Tradene the eus new chief has accused donald trump of electioneering, calling him obsessed with trade deficit and warning about the economic damage of addiction is protectionism. He urged them to work with the eu on open commerce. The objective is to try and reset the relationship and and findd each other Common Ground in relation to many issues. That was the eu trade commissioner phil hogan speaking exclusively to bloomberg. Still with us, david stubbs from j. P. Morgan. If you look at trade, its better between the u. S. And china. What if the u. S. Sets its sights on france and germany . That has been a risk for a couple of years with the president s comments. Late last year they were supposed to report on the issues. We had the white house basically burying the issue on china. Its possible it reemerges, i would suggest president has made the calculation with the election coming up. He does not want to get into any he isights and i suggest now focusing on market performance. Risks asprice tariff long as it is not in the long run. Francine is it finally the year when european equities outperform u. S. Once . Ones . David we are still in favor of the United States. It does not mean there is not european stocks to engage with. Ofre are plenty incomegenerating and cyclical stocks. We are trying to buy secular growth, often listed in the u. S. We do have a Macro Economic slowdown in europe. Its not clear the exceptionalism in america is going away. , we are nott could ready to make a massive call on europe this year. Francine we spoke about emerging markets, but if you look at 2020, what are your top three picks . Overall. David emerging markets have one of the highest potential total returns, absolutely. The stabilizing in trade should prompt em outperformance. Emergingmarket countries have had their and you have stable leadership. You might not like them, but you know who is in charge. Alongside responsible policymaking in Central Banks as well. We are engaging with clients in emerging markets. Francine what is your take on bubbles . The bond market is normalizing, what does that tell us . David we push back strongly against the notion of a bubble in the government on market. Bond market. Term, ands a specific as a key part, has a deficit in structural growth, and by definition, the bond market does not have that. Bonds are getting a little less expensive but we think they are there for a very good reason. The inflation pressures are not going away and could argue leak at worse. Arguably get worse. One of the biggest things in 2019 was the banks fully processing the environment. Francine you dont see a repricing of funds . David you could always have idents like the bond stock bund shock, but that was markets dealing with policies that were totally alien at the time. Have become more comfortable and Central Banks have committed to keep these policies on hold. Its a long way off and thats one of the reasons we have seen significant gains in the equity market. Francine david from j. P. Morgan stays with us. Coming up we get all the details and what that means for the markets next. This is bloomberg. Francine this is bloomberg surveillance. The senate has begun the formal process of impeachment for President Trump. The democrats will try to force a vote on witnesses, including Mick Mulvaney and john bolton. Meanwhile, an independent panel says the white house broke federal law when it withheld more than 200 million in security aid. This issue is central to the impeachment case against President Trump. Joining us for more is our ,enior writer, Stephanie Baker and david stubbs from j. P. Morgan. Do we have any idea how the trial will play out . Both sides will present their side of the case, trump and the house, and then senators will ask questions it is unclear how long that will last. Clintons impeachment lasted 16 hours it it could last longer this time. Stage, the republicans would like to hold a vote to dismiss the case and get to the crunch point where whether or not democrats could convince her publicans or introduce additional evidence. Francine what role does chief Justice Roberts play in this . Stephanie he could play a crucial role. Footstepsllow in the of chief justice ryan west rheinquist where he tried to remain hands off. I didknown for his quote nothing in particular and i didnt very well. Did it very well. In this case, the partisan divisions rstar. Stark. Re does justice tie, in . Rts way in weigh francine what about lev parnas . Be huge, it could because he has implicated , whichnt and mike pence changes the nature of the debate. He has also implicated william barr and i think that does change the nature of it if they are allowed to testify in the senate trial. Francine how are markets treating impeachment . David the consensus is that the president will not be removed so i dont think it particularly impacts markets. It is topped by the uncertainty of who the democrats choose in the primary process and how a campaign between that candidate and president will be shaped. Ver the summer get intoible we could a loselose situation with a very progressive resident and a bellicose president with his comments about international affairs. Those are risks for the year but are not manifesting themselves right now. Francine does it affect the polls or President Trumps popularity . Stephanie this is the issue of whether or not witnesses are called. Obviously, he will be acquitted. There is not a two thirds majority in support of impeaching him. But if the trial proceeds in a way that introduces more damaging evidence, perhaps it could change the polls. But throughout his presidency, his base has remained stable. There are small swing boats up additionalnd perhaps damaging evidence could influence those voters. Francine Stephanie Baker will join us later. David stubbs from j. P. Morgan stays with us. Milestone. This is bloomberg. Francine stabilizing chinese economy. It ends on an upbeat note in gdp stays steady. Chief pulls trade no punches on his washington trip as he cautions President Trump against protectionism and shortterm thinking. Alphabet joins the trillion dollar club. This is bloomberg surveillance. Actuallyil sales are much more important than in the past. Inectations are being priced of a rate cut on january 30. December retail sales are falling. That is quite significant and. 304 he pound at one 1. 3084. Lets get straight to first word news in new york city. We begin with breaking news. The u. K. Government is considering subsidizing some flighty art of the this airline rescue package. The owner has criticized it as a quote misuse of public funds. Chinas economy is stabilizing after slowing to the weakest pace of growth in three decades. Gdp rose the same as the previous months at has seen the first acceleration in investment since june. This signals further recovery could be underway. The u. S. Treasury will start issuing twentyyear bonds, expanding its mantra of securities as the government looks at ways to fund its growing deficit. Institutional investors are calling for riskfree securities. Donald trump has confirmed heman he plans to nominate Federal Reserve positions and move to the u. S. Senate for confirmation. Global news, 24 hours a day on air, on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. Francine . Oomberg. Francine get a look at your stopovers with Annmarie Hordern with annmaries hordern. Annmarie i want to start with richemont. They were able to make up sales in the crucial Holiday Season while they faced a decline in hong kong. The whole watch sector has been facing troubles in the hong kong market. 8 . No is down more than warning out init france. The strikes are hitting the bottom line, especially during the sales. Cd project is plunging today. They were the biggest gain or across the stoxx 600. Berpunk, ao do with cy new videogame. Theres a lot of anticipation but they would have to delay it. It will still be historic, but it loses a bit of credibility. Slightly after passing the 1 trillion valuation mark. Joining the club with microsoft and apple which respectively have 1. 4 at 1. 3 trillion valuations. Amazon has not quite join the club yet you can see the tech sector is the marketdriving force. S p is made up of these three stocks. Francine thank you very much. Lets get more on these tech valuations. So with us is david stubbs and alex webb who writes about tech for uber. Bloomberg. Does this change anything at all . Number. s just a being worth 90 billion instead of a trillion, its just a number. The thing that is quite interesting is the nature of the valuations. Google, by some arguments, is undervalued. Apple,es at the same as and traditionally they trade at a generous premium. Two thirds of revenue still comes from the iphone and google is able to depend on more reliable, recurring revenue. Haps there is concerns there are concerns priced into. Francine what are we going to see from google and alphabet . Alex the cloud is a huge priority. They have not managed to keep pace with leaders in the field which are amazon and microsoft. Is is the biggest and azure trying to eat at the market share. Google is way behind. They have made a few acquisitions to catch up in an effort to pivot away from the core advertising is this. There are the subject of huge regulatory scrutiny. Francine what does that mean for putting your money in tech or not . David this is one of the most common conversations we have. But if itoves tech, is just in u. S. Market cap, yo uhave ahuge concentration. Huge concentration. If you wanted to go internationally you have tech outside of the u. S. In asia and europe. If you do those things, size, geography and private markets. Keep the level the same but hedge the concentration at regulatory risk. Somethingis there below the Tech Companies that you like . Components or Something Else . David one of the most important innovations is a fund focused on vehicles and the supply chains. These are tech firms focus on a thematic one and we have a whole range of tech and internal funds focused on different niche is niches. We have tremendous enthusiasm amongst our clients for those. Francine if you look at regulators, the biggest concern, is there a regulator markets fear more than others . Alex Margrethe Vestager is up there. But the u. K. Markets authority is going to be certainly slightly more powerful. It is trying to build an expertise in digital advertising. Does, others will look at and potentially follow. Francine as you set out your opinion pieces, what are things we should be watching out for . Alex the regulatory, cma question, 5g and the way that affects the cloud space and the ,bility of telcos to push back bigthirdly, i think the way carmakers are reevaluating their approach to the threat of electric, Autonomous Cars and ridesharing. There has been a calibration there. Francine what does this mean for you, david . Is it to enter a great market with new multiples. David the pure ridesharing platforms obviously struggled in terms of investment. That is a revolution which could depress large parts of the automobile market because there is more efficient usage of their product. Most cars sit idle for the vast majority of time. Ridesharing raises the use of vehicles. For us, the threats we just heard about our driving a combination of changes. We were focused on investment in other ones. They require vast amounts of new technology and long, dense supply chains. Thats why we have dedicated Fund Managers focusing on it. Francine thank you both. David stubbs stays with us. Its a week before devins davos. Ourt miss our chief interview with the chief executive of microsoft, cisco, and facebook. Francine this is bloomberg surveillance. We have looked at the probability that the bank of. Ngland will cut Interest Rates this