The two handle for wti, the brutal level as the dollar continues to tread lower in the market. Guy . Guy long food, short travel seems to be the trend in europe. Like you in the United States, we are off our lows in your. We did not get the squeeze friday. The stoxx 600 is still down. Every single sector is negative territory. Health care, food and beverage, and basic resources, where we are seeing the least losses. Insurance, travel and leisure, construction are the biggest losses, another big selloff in the btp market in italy and we begin to see volatility pushing ever higher. We are off our lows on the day but european volatility shows no sign of letting up on the outside. Lets get back into one of the big stories weve been covering over the last hour. Proposed,an union has this coming from the European UnionCommission President , a temporary restriction on nonessential travel to the European Union for 30 days. She informed g7 leaders of the band during a Conference Call earlier today. Lets get the latest on this with maria tadeo from brussels. A couple of things occurring. Why is it taking so long for this to happen and is it response to what we saw from the United States . But what isuld be, clear is european officials are trying to take more measures to prevent the virus from spreading. They realized that the center for the virus has clearly moved to europe. We have seen those numbers rocket in italy but also spain, france. We are seeing governments take more draconian measures to try to stop it as it moves along those lines. Trying to contain the virus. I do want to point out what ursula von der leyen just said, it is guidance from the European Commission. It could only happen if european leaders agree. The timing is interesting because tomorrow european leaders will have an emergency call. They will get together and if they deem it necessary, they will go ahead with the ban. This means if youre trying to visit europe, planning on getting on a plane deciding to come on holiday in europe, which seemed unlikely anyway, you would be prevented from getting on the plane and coming here unless there is a very strong exception for that. You are thinking health and medical equipment. As at this point it is just guidance. The final decision will come down to european leaders. Alix what is the consensus . How broadly are they discussing this and will they agree . Maria there is a number of issues at stake. When you speak to officials, they are aware the situation is now very serious. They are aware the situation is not just about italy, it is really affecting every member state on a different scale, but the virus has been spreading around europe. They will also tell you the economic repercussions will be very serious. They do see the european economy shrinking by 1 , and they will tell you a recession at this point is the base case scenario. Everyone is keeping a close eye on Emmanuel Macron. He is expected to speak before the french people at 8 00 european time where he could announce a shutdown in france. This is significant because it would be the second, third, and fourth biggest economies in europe shutting their lights off business. That would be a dramatic escalation but at this point nothing has been confirmed. Theres a lot of speculation as to what Emmanuel Macron could announce but nothing certain at this point. Guy how much cooperation is there between european leaders . Every country seems to be doing slightly different things. Italy, france, spain, germany, all taking slightly different approaches. How much commonality will come out of the call tomorrow . Maria it was obvious last week the eu was saying we are working together, theres a lot of cooperation. If you look at each individual nation, they were all taking very different steps. ,ust to be honest and clear Member States thought the italian response was an exaggeration and now they are doing the same a week after. This is what they are seeing the European Commission try to step in and coordinate. You are also seeing Emmanuel Macron push for the g7 call happening today because he was the one who put that idea on the table. The french are willing to see more coordination among Member States if it is not working last week. You are also seeing ursula von der leyen saying let me participate in the call and lets try to Work Together in a way that is much more disciplined. Guy thank you very much, indeed. Maria tadeo joining us from brussels. Alix form on the stock market is ian hartnett, absolute Strategy Research chief investment strategist. Good to see you. Andrew sheets at Morgan Stanley said valuations look pretty good. I may take on a little but of rest. Is this the time to take on risk . Is thist we are saying will be a multi phase down leg for Global Equities. In the initial phase we will try to establish Technical Levels and you can see equities versing bonds looking very attractive. If you look at absolute valuations in the equity market, we are still at a 10 discount on a Global Equities relative to the 10 year average. In2012 we got to 30 and 2008 we got down to 55 . I think we will try to build a rally. There are attractive looking levels. There will be attractive looking stocks after the big selloffs we have seen, i am not sure this is the end of the game if we are right and you have a multi phase selloff on a multifaceted crisis. Alix is there anything we can see from governments that can help accelerate these phases and get a bottom . Ian the key is we are now out of ammunition on a policy front. The fed blew everything over the weekend. This is absolutely all we can get. Perhaps you can see a bit of etf from goldman, you can see Corporate Bond buying, but now it is all about how you stabilize things from the fiscal side and the willingness of the fiscal authorities. So far, a lot of what we have heard about 1 to 1. 5 of gdp is probably not going to be enough when you look at 2015 or 2016 and look at the scale of the chinese stimulus. We still need to see much more coordination and much more determination from goldman to turn this thing around and it is hard to fight a virus with monetary policy. It has to be fiscal as well. Guy any levels you are looking at . Ian we have been saying the starting point has to be 2016, the 2016 lows. That strikes fear into the hearts of u. S. Investors because we are still a long way down to go on that. That 2016 level, the reason we are pointing to that is because our now cast of economic activity, before we had the oil price shock, we are down at the levels. Until we reach this kind of levels, notwithstanding the low Interest Rates, we are in a zero rate, zero growth world if that is what you have to cope with. Lows is in the 2016 where we should be looking. Even Something Like boeing that has had a terrible performance, it has still not yet gone down to the 2016 lows. That is the wording thing. It is the u. S. Market the needs to find a base, not the rest of the world. Guy you talk about the zero growth world. What sort of earnings number should we be looking for this year . Ian we came into this with a hawkish view. We were already talking about 10 eps growth. That is before this oil shock and the coronavirus shock. We have now penciled in 20 year on year eps decline. That will be very similar to what we have seen in the aftermath of the tech bubble. Not quite as bad as we saw in the gmc, but these are horrendous numbers. That is why i think you will see multiples discount a higher level of discount. This is why we have not been so excited about the narrative about the fact that bond yields will bear you out. In a world where Economic Growth is slowing, and a world where Interest Rates are being cut aggressively, that is telling you there is bad news out there. Equities do not do well until you stabilize after a period of time. Duration in terms of length of time rather than bond duration, that will be playing a role. We will take time for investors to feel confident. We still feel that what youre seeing is the liquidation of funds and that is one of the reasons why we are not convinced this is the bottom for this, even this technical rally. Alix ian, youve been on the zero growth, zero rate story. What you do . Are you in cash . Are you buying gold . Ian the things you go to gold, at the moment people are liquidating. They are trying to find any liquid asset they can liquidate to hit some of their margins. Shortterm we have seen the gold,. We would still be positive on gold. We would still be positive on cash. I would still be positive on u. S. Treasuries, even up. 8 . The pressure there is for yields to come lower, and in the equities base you will lose less defensive stocks. As i mentioned, there is probably still for more downside scope to the industrials, some of the more sickly sensitive areas of the markets. In the past it tends to be more consumer focused and less industrial that tends to hold up well it is thing like Agricultural Products rather than Industrial Metals where you can hide in these kind of markets. One of the things weve all only thingat the that goes up and bear markets is correlations. It is hard to find a place to hide. Guy stay with us. Plenty more to come from ian hartnett. Lets check in with the Global Markets and see where we are in the session. Lets go to kailey leinz. Kailey i have good news and bad news. The good news is we are well off the lows of the session. The bad news is we are still down between 6. 5 and 7 on the major averages in the u. S. More pain for the small gaps the small caps. A little less with the stoxx 600 outbound down to just 4 . This is an equity market that is fearful of the spreading coronavirus and spooked by the 100 basis point cut from the fed. Will it be effective . What does the fed know the market does not know . This is well off the lows of the session. We triggered our Circuit Breaker immediately after opening this morning with a loss of 8 on the s p 500. That then went to 11. 5 before we recovered. This is not the only day we have seen that kind of crazy volatile session. We triggered the Circuit Breaker in three of the past six sessions. Also getting one on monday and thursday of last week. It underscores the heightened volatility we are seeing right now. Something interesting i want to we have seen stocks selloff five times faster than they did during the financial crisis. Earnings revisions are not keeping pace. If you take a look at the terminal at gtp go at gtv , into thousand eight stocks fell followed by a 40 decline in earnings estimates. That would mean earnings revisions wouldve had to be revised lower by 14 . Instead what we are seeing in blue is theyve only gone down 1. 5 . That could signal analysts are still too optimistic about this equity market. As for individual equities in which you are seeing optimism, take a look at the packaged food space. As coronavirus concerns are spreading in the u. S. , people are rushing to the grocery store. I can tell you this from experience. All of the Grocery Stores around me have empty self empty shelves. Jeffries is saying food at home shales good rise in the next month. That is giving a boost to Companies Like can aggro, james smucker. Guy late last week the fda gave roach a green light for emergency use of its highvolume coronavirus test. President trump talked about the decision at his News Conference friday. Using federal emergency authorities, the fda approved a new test of the virus. We did this within hours after receiving the application from roche, a process that would normally take weeks. We expect up to a half a million additional test will be available early next week. We will be announcing locations on sunday night. I want to thank roche for their incredible work. Guy joining us from switzerland is the ceo of roche. Octor, the president talking as if this is happening quickly. Your tests are being brought in as quickly as humanly possible. You must be frustrated. It has been clear this virus will travel to europe and the United States. How frustrated are you this did not happen earlier . I am quite proud of what we have achieved, not only as a company but also in an excellent collaboration with the fda. We started to develop this test for hyper platforms in january. We developed the test in record time. Due to a very good cooperation with the fda we got emergency approval on friday. We have shipped the product and the tests are now available in labs across the u. S. Not you are saying it could have happened any faster . We started right away and we developed this test. There are other tests available in the market. There is an enormous demand for tests. We cannot yet meet supply. I am very glad we could make a big difference with his new test , which was actually approved in record time. Alix when you take a look out to april, what should we be doing today and not two weeks from now to get ahead of things . Dr. Schwan the most important method at this time the most important matter is the individual responsibility of all of us to stop infections and to flatten the curve. It is about social distancing. It is not it is about washing your hands. That is the most effective way to stop the spread of the virus. Alix are we doing a good job of that . Dr. Schwan good enough job. I think it is high time for all of us to take this very seriously and make our individual contribution, all of us. Can i come back to the question of the testing . Thereve been some that have suggested the older testing you used in asia could have been available earlier in the United States and earlier in europe. Is that the case . It is a lot about the ins dr. Schwan it is a lot about the installed platform in the system. That is part of the challenge. We have to ramp up the installed base of machines so we can do the testing. That is also the reason automation is so important. You cannot imagine you also need a lot of people, you need Human Resources to make it work. With this new offering, i am very glad we can bring important relief to the overall system. Guy in terms of the machines you have that are going in now, you have the 680 and the 880. Is there a 980 . Is there a faster way of doing this . The cobit 8800 is the fastest machine available in labs. Alix can you tell us where the next firepower is going . If you have the fastest machine, what is after that . What can you innovate to combat this in the future . Dr. Schwan the bottleneck is the rampup of production in this stage. Crisisse, following this roche will including look at higher systems for the future. The development of such platforms will take many years. At the moment the focus is to run as many tests as possible on existing platforms that means we have to ramp up the supply of testing. Alix here is a question from a bloomberg viewer. They wanted to know what your opinion was with respect to the fact that testing in switzerland is only for over 65 people in severe cases. Is that the right way to do that or doesnt need to be more broadbased irrespective of age . Dr. Schwan it is not a matter of age. What matters is you are termstizing patients in of showing signs and symptoms. Do they have fever . Do they have a shortage of breath . Is there a suspicion they have been infected with the coronavirus . That is how we have to prioritize patients. Let me also say we have to prioritize testing because there are not enough capacity for broadbased testing. That is not only the case in the United States, that is the case worldwide. Says we are beyond the point at which testing is useful. Do you disagree with that . Dr. Schwan i violently disagree with that. If they know whether somebody is infected or not, we can take action. We can isolate those people, we can treat those people. Likewise, if we know somebody is not infected, we save resources in Health Care Systems for those who are in need. In terms of mutations, is there an expectation within your company, within your scientists that we are going to see a mutation . The u. K. Is having a strategy that we need a herd immunity to point where reach a the virus can stabilize. Is there any sign this virus is mutating . Any expectation the virus will mutate . Dr. Schwan i am not aware of any mutations having occurred already. We know that viruses, if you , it mutates,flu that could also be the case for the coronavirus. Thatieve it is important we can react accordingly in case the virus starts to mutate at some point. Alix if we take a look at china, where things seem to have stabilized, the fear is that it not be a vshaped, it will be a w, where you go back to the worst but there will be incidents and issues and you go back to work and it becomes a slow grind. Are you noticing that at all. Once we clear this comedy things get better fast . Dr. Schwan all of that is speculation. What matters is we slow down infections and then we will see how the virus evolves and then we have to react accordingly. I believe it is too early to judge how the virus will evolve and how the spreading of the virus will evolve in the respective geographies. We do still see case studies like china and south korea, italy, the u. S. Taking more drastic measures. Have you seen one that works better . Doubthwan there is no that if you stop people interacting with each other, the virus in the spread of the virus slows down. Let me put it into very theoretical terms. If you could avoid human contact worldwide for two weeks, the virus would be finished. It would have no place to go. This is only theoretically. It shows you that if you slow the spreading, of course you can flatten the curve and that is critical at the moment because this gets a leave of the Healthcare System to cope with the patient r