Worst performance in the hamburg election since 2002. Unicredit ceo rules himself out of the running for hsbcs top job. To leavey is expected barclays at the end of next year. The european open sent to be dominated by talk of what is happening in italy. Lets get to the futures. The extremes of selling we are expected to see. We did see negativity during fridays session in europe and the u. S. The change in case numbers in italy. The measures being taken by the authorities to try and stamp out this outbreak. We will keep an eye on that and bring you all the latest headlines. Lets have a look at what we see on be aware that the ftse futures in italy looking really negative. Lets have a look at what is going on on u. S. Futures. This is set to go increasingly global, it would seem. It looks as if the negativity will carry through europe and into the u. S. Session. Ets look at the gmm we had a lot of negativity before we got news out of asia. The malaysian Prime Minister has resigned. Another reason to sell in malaysia. The malaysian stocks, currencies, and bond markets. Even aside from that, heavy volume coming through even on a day where china is out of action. A lot of that focus is on south korea and italy. Australia and the currency markets, Australian Dollar near an 11 year low. Because the japanese markets are getting close, treasury markets open up right around now. This is what we see in sovereign bonds. Reaction to the malaysian story. Also worth mentioning what is going on with kobani markets. The bdi crude down by 2. 2 . By 2. 2 . Ude down cudmore from mark singapore. I am looking at where the u. S. 10 years opening. Is ouras closed, so this first look, if you like, for this week. Gold,going into havens, bond markets. I wonder how low these treasury yields can go . Will the record for 2016 be in target for traders. A structural bias tends to be little bit more bullish than many in the macro community. I think this move makes sense. Yields shouldy rise substantially at any point given that there is no sign of inflation for a long time. Now that we know we will have a being hit to Economic Growth this year, this is a period where it makes sense for bonds to do well. That may not last as long but i think even when the risk aversion is over, it is likely that yields backup significantly. Looking at what is happening with the alltime lows, touching on the 30 year. The yield very much in focus. Let me go to the european picture. 3. 6,tse future down by 3. 7 this morning. Where you are, the focus has been on south korea. Exercise thene an where exactly we see an intensification of this virus geographically, and selling the risk assets in that country. That was the case in south korea and seems to be happening in italy as well. Mark i think it is important to emphasize that japan was closed today so we may see japan back at the forefront tomorrow. Japan is people are worried about the situation in japan given the spike at the end of last week, especially in the context of the terrible gdp. And negative february pmi print as well. There is a great risk of recession in japan. On the virus front, japan will be back there with korea. Chinese markets may be able to perform here. Hase is an idea that china gone through the worst of this virus. Spike hasews flow gone through the dramatic. It is also because the Chinese Government is made particularly clear over the weekend that they will escalate stimulus. Chinese markets have always traded more often chinese stimulus than Economic Growth. We know the economy will be hit in china. Stimulus will support the stock market. Korea and japan are the forefront in asia. Italy obviously in focus. Aboutwe have been talking treasury markets reacting. 10 year yields dropped the lowest 2016. The a lot of questions being asked. About what fiscal actors canoe. Can fiscal stimulus impact. We talk a lot about what monetary authorities expect to do. Exalted a lot about how perhaps monetary how exhausted perhaps Monetary Policy is. This has obviously been a longrunning debate, particularly in europe where people have been looking to put pressure on germany for some time. Are there signs that it is being delivered . In some countries, it is. There are certain countries that are always proactive, they are being proactive. Tovincing other countries open the purse brings the pursestrings, it is not clear yet. Will this be enough to repair damage . Thursday economic damage and the market damage. It may be easier to repair the market damage than the economic damage. It often seeps directly into markets and may bypass the real economy, or at least the impact on the real economy may be more subdued. The counterargument, fiscal stimulus more than Monetary Policy should feed the real economy more. Much of the damage to the coronavirus is in the services sector. Cutou dont get your hair because of the coronavirus, you dont get it cut 20 is often oftenhe cut twice as when the virus ends. Anna that is really interesting, something we will look to the start of european trading for what that means in an italian context. Italian futures down 3. 7 this morning. We have course solidly taking action to cancel a number of events over the weekend, bday sporting or cultural. Her member, you can join our debate, get involved in our question of the day. Can fiscal stimulus cancel out virus impact . The service sector, it is maybe a little bit immune to that kind of stimulus. Up next, we will get your stocks to watch. Overarching theme will be coronavirus. Luxury stocks, airlines, anything italy focused on the clampdown. Few stockso get you a specifics included a spanish company. This is bloomberg. Welcome back to the european open. We are still some 45 minutes away from the equity trading day but we already know something of what it will look like it will be negative, especially in the italian market. A be rise of the number of cases of virus in italy. A big focus on the clampdown measures, the extent to which it will weigh on the Italian Company the italian economy. Impact theey do to economy . The focus in asia has been on the korean market for similar reasons. We see gold prices going higher, Energy Markets once again. Oil prices down by 2. 5 . Treasuries, selling and equity prices, no surprise we are seeing money find its way into some of the safe havens of the treasury market. 30 year in focus after record lows friday. 10 year yields dropping to their bidst since 2016 as haven continue to be the main theme. It will be a market all about the big picture. In jewel stock stories to focus on stock stories to focus on. From samsung. Tory asml is part of the supply chain. Revenue of asmls coming from samsung. South Korean Companies being hit hard today. Samsung being one of them, especially this weekend when an employee tested positive and they had to shut down a plant. Eye one will keep an that one. We will certainly keep an eye on the tech sector and anything else deeply embedded in the globalization story. , a spanish stock. Almirall is guiding for da, below thet consensus of about hundred 6 6 millionuros. 30 euros. The reason they give, one of facing a lotugs is of pressure from the generic market. They have their own authorized generic to be launched soon. The net income line just about beat expectations for last year. They are looking at doing a. Haps some other m they paid around half a billion euros for some technology. They could be looking to do some a soon. The headline will be on a miss for the ebitda. But they do expect that to be a oneoff impact for this year only. Anna thank you. You can focus on all of the stories via our equities team. Lets get to the banking sector. Some really interesting movement or lack of movement. Confirmed the ceo is not in the running to take the helmet hsbc. Thirdender embarks on its of overall in a decade. Sticking with u. K. Banking, barclays cto says he expects to leave the bank by the end of 2021. Instability at the top of u. K. Banking, perhaps. Joining us with all the details, bloombergs European Finance at esther, wolf larson. Editor, wolf larson. Where does this leave hsbc and unicredit . Its is better news for unicredit. He has really been the person to turnaround the banks. That may be one italian stock in the positive territory. Markssbc, question continue. Ustierve to wonder, if m withdraws, where does that leave ceo. Quinn, the the question marks continue. Anna in terms of the hsbc surge, are there really external candidate still in the running, this iesco ls noels to lose . Was that it was a two horse race. They say they may be searching until august for a candidate but if it is true that they only looked at two and one has dropped out, you have to wonder about what will you do with no quinn . Anna thanks very much for the update, European Finance editor ross larson. Coming up, the rotavirus dominates the g20 meeting in react in riyadh. The events in italy and the reaction will be the focus of equity trading today. Futures, i think we will see a little bit of a move to the downside. Futures down by 3. 8 . Ftse futures down by 1. 7 . Elsewhere, questions being asked. This also be reflected in treasury markets, into safe havens. Treasury yields on the 10 year, the lowest since 2016. This is bloomberg. to theelcome back european open. 21 minutes past 7 00 in london. European futures suggested negative moves at the start of trade. Futures as we wait to see how investors assess the latest rampup coronavirus breakout in italy. Dominatedic fallout the g20 meeting this weekend in riyadh. Market has basically the view that glass is halffull. The world will pass that stress test. One quarterorary impact on gdp and trade, and we will rebound. That is also in our projections. But it is the optimistic scenario. There are much larger downside risks. Crannyloombergs manus joins us now. Take. As axel webers but with everyones glass halffull at the g20 meeting. Manus i think there is a certain amount of sort of stoicism. All ready for the next evolution. A crisis is never a crisis until you can see it, touch it, feel it, smell it. That draft of the Coronavirus Crisis and its impact economically is moving towards europe. Could landed, and it travel more aggressively north, south, and to the west or to the east to the west, i should say. Remains over at period of time, the equity markets you could say are playing catchup. The bondekly close on market from last week. The other conversation, at the oecd, he talked about a lot of topics but he was a strong proponent of the surplus countries need to spend. He did not name names. It was a great interview. Welcome back. It was very wet in london last week. Anna i was elsewhere in the u. K. Where it was very wet, if not wetter than london. Butmuch rain in saudi certainly a lot to talk about with comes to the Global Economy. Lets talk with janet, globally economist. Weber, hearing from axel saying the markets class is halffull. He said that at the weekend. Things are a lot more dramatic. Ftse futures down 3. 7 . Orchidshink the stock the stockmarkets are going to maintain this glass halffull approach as we see the Coronavirus Spread into europe . We think that the equity markets are kind of complacent about the current situation. Many are expecting the virus to be contained by china or globally by the end of february. It is now spreading the rest of the world. Concerning,more because china, they have the power to quarantine the whole region. If you are talking about cases like in italy, you are talking people in movement of the european union. There is a real risks to the already fragile european economy. We saw the high, it was complacent. The natural reaction to what is happening. Assessmentuch of an can you make about the chinese economy . What kind of impact does that have . Janet i think it is a bit too early to say. Q2, you rebound because of demand and investment. Tment has definitely slumped. We have seen recovery in the highfrequency data. It is a modest recovery at this stage. Over 50 of factories are actually restarting actually, the capacity is still low compared to where they should be. The risk is more towards the downside, especially with global uncertain. I think china will need to restrict travel. I just think the situation is getting a bit worse than people have been anticipating. Takes axt, cdu battering. Angela merkels party. We bring you the latest. This is bloomberg. Good morning oh no, here comes the neighbor probably to brag about how amazing his Xfinity Customer Service is. Im mike, im so busy. Good thing xfinity has twohour appointment windows. They have night and weekend appointments too. Hes here. Bill . Karolyn . Nope no, just a couple of rocks. Download the my account app to manage your appointments making todays Xfinity Customer Service simple, easy, awesome. Ill pass. Anna welcome back to the european open. 30 minutes from the start of cash equity trading. I am anna edwards. This is the picture for equity futures. There was an Asian Session down by 1. 3 percent. The move in the kospi could be moved to italy because the focus in asia. Let us have a quick look at what is going on in the bond market. The slide into the havens continues. The italian story is different. , thes on u. S. Treasuries tenure the lowest since 2016. European yields also going lower. Money is going into fixed income in the bonds market. But the italian yields are up. Let us stick with europe and talk about what is going on in germany where Angela Merkels party has plunged to a historic low in hamburg. Leader for the cdu has come under fire for trying to steer the Succession Process. The party will gather in berlin in an attempt to seek a way out from the political crisis. Daniel schafer joins us now. Great to have you with us. What do the hamburg results mean for the cdu . Daniel it is quite the opposite of a positive experience. ,t has been a historic defeat 11 point 2 , the lowest since world war ii for the cdu in hamburg. In parts the end result of what happened in another german state a few weeks ago where the cdu threw in its lot with a Rightwing Party to elect a premier in this region. And that cost a huge controversy theultimately the fall of and also impacted the hamburg elections. Anna what about the Succession Process then . How will that play out in the cdu . Daniel the Outgoing Party leader is struggling to get the struggled to get the process going. A number of Senior Party Officials who said this is taking too long. The whole Succession Plan and process, before it even started, was already on a bad footing. Today, she is planning to meet the cdu leadership and she is also going to talk to the press at 1 30 p. M. Today to unveil her new plan for the succession at the top of the cdu and therefor also how to find the successor for Angela Merkel as german chancellor. Anna daniel, thank you so much. Daniel schafer from frankfurt with what is going on in hanover. Janet mui the global economist from cazenove capital is still with us. A colleague showed a graphic from germany and it shows there is an expectation in the markets that will fall but we will not see them go into a budgetary deficit. Is that your expectation as well . A little bit of a giveaway but nothing as extreme as the italians have been calling for or other parts of your. Janet our consensus is that for germany, they are quite fiscally conservative so they always have a budget surplus. For them to employ the surplus meaningfully to boost the fiscal easing is quite difficult. It is not their mentality. They are savers. Agingre facing demographics problems which they will have to deal with at some point and having that surplus fiscally conservative and responsible for the country going forward. Especially now with the party and political turmoil and the question of succession. I think it will be even harder for germany to unite and implement any necessary easing. Anna do you think germany needs to ease fiscally . Is it what is the reasoning for germany to do more fiscally . I with think they need to stimulate the economy a bit more because they are already flirting with a recession. Fiscal stimulus, if it comes much later, it will be too late they signal a recession. Germany sinks into a recession, it is likely that surrounding economies will suffer. By that point, it is usually too late. The risk of the corona virus spreading in europe could be a potential reason why they would do it as well as the interruption to the supply chain. Currently the data is still ok. There is still knows ingestion that there is a negative hit. If the German Government rings last year, the worst it is unlikely that they will do more as the data begins to recover unless the coronavirus gets much worse. It is interesting that the italians are not asking for any suspension of the shenzhen rules. Schengen roles. Can fiscal stimulus do anything to affect the coronavirus . Servicesot support the for the economy that much. Is there a sense that fiscal policy cannot do enough in this situation . Janet i think people are going to be more concerned about their health and safety at the foremost. Pushiscal stimulus could some things if the companies are really struggling. The government can help them which should help with sustaining the Employment Situation which is crucial to the services center. Services sector. There is a limit to what the fiscal stimulus can do. Be hits to confidence will too severe for people to spend comfortably. Anna we are already seeing that. Janet, thank you so much for your thoughts so far. Janet mui from casimir capital will stay with us. Italy is the epicenter of the coronavirus in europe causing the cancellation of several events including carnival. We are live in rome up next. European futures are points lower. There is a particular focus in italy. In ftse nets futures. This is bloomberg. Anna welcome back to the european open. 7 40 in london. In rome, the epicenter of the for the focus coronavirus is right now. The caseload is climbing. And as a result, we expect investors to focus on the italian market when they open. Expects to leave at the end of last next year according to the financial times. He is currently under an investigation. Barclaysistracti