Milan has seen a slowdown in new cases as wuhan prepares to lift its lockdown. Nejra welcome to daybreak europe. We have a lockdown in the u. K. The wuhan lockdown taken for the First Time Since january 23, and the fed pulls out all the stops, extending its Corporate Lending program. The fiscal stimulus package from the u. S. The movement from the fed brings a little life back to risk assets, some green on the screen in u. S. And european futures. We see gold extending gains. Goldman sachs says theres an Inflection Point after the selloff, and it is time to maybe move into gold. They are talking about the move from the fed easing the liquidity crisis that caused the selloff in the first place. Oil rising as well. The u. K. Is in lockdown after Prime MinisterBoris Johnson ordered sweeping measures to stop people leaving their homes for at least three weeks. Police will break up gatherings and have the power to fine individuals who break the new laws. I must give the british people a very simple instruction. You must stayathome. Because the critical thing you must do to stop the disease spreading between households, that is why people will only be allowed to leave their homes for the following, very limited purposes. Shopping for basic necessities, as infrequently as possible. One form of exercise a day. For example, a run, walk or cycle, alone or with members of your household. Any medical need, to provide care or help a vulnerable person. And traveling to and from work, but only where this is absolutely necessary and cannot be done from home. Thats all. These are the only reasons you should leave your home. Nejra joining us for the hour, the chief global strategist at nordia. Andreas, what impact could this imposition of the lockdown, with lay, will have on the u. K. Economy . Positive for the economy. We have seen this, in china, italy. It will lead to a recession, if you can call it that, a political decision to close. But we can get out of the woods within 46 weeks, thats probably the best case when we look to china. Nejra we see investors selling the pound. One reason, Dollar Strength is the other, the u. K. s laissezf aire attitude until now. What would you take around the pound now . Andreas i would sell it. Arguably sterling is better poised to deal with rising credit risk. What happens right now, a lot credit risks are being transferred from the private sector to the Public Sector in terms of lockdowns, and one way to reflect that is to sell the underlying currency. There is no real credit risk associated, but investors reflect that by selling sterling. The massive issuance should be expected by the u. K. And would lead to a selloff in sterling, and i would expect that to continue. Nejra andreas stays with us. Great to have you on the show today. Lets go to maria tadeo, who joins us from brussels. Give us the latest. The u. K. Delaying imposing these measures compared to the rest of europe. Whats the outlook now . A complete uturn from everything we heard until now from Boris Johnson, who at the beginning i am sure you remember saying he did not want to shut down the u. K. , that he did not feel going the italian lockdown,erence to a would be appropriate. Yesterday night, if you look at those measures, essentially telling people do not go out in the street unless you need food or medicine, very similar to what was done in italy at the start of the crisis, and now in france, germany. Politically, it is seen, as a huge uturn and the question at this point is why did it take so long . The only measures in place last week, closing schools, restaurants and pubs, only put in place four days ago. Yesterday, we had a sweeping range of measures coming in. What it does suggest is the curve was not improving, that perhaps the numbers the government was working with did not look good, and economically if you take italy has perhaps a benchmark of what could possibly happen, we know this will not be good for the economy, shutting down business. Nejra its interesting. Sweden is still one country in europe taking a laissezfair attitude, no big lockdowns, allowing gatherings, shops open, things like that. But you point to italy and spain as perhaps indication of what happens to the u. K. Next. Any sign of Inflection Points . Maria spain is running behind italy about two weeks. We still see numbers increasing, but the government said it clearly, this will probably be the most painful we get. Yet. But when you look at italy, its dramatic, cases have top 60,000, big numbers still. But when you look at increases daytoday in the north of italy, we now see the smallest increase on a daily basis for the second straight day yesterday. That is perhaps a signal we are getting close to the peak, and peak, numbers would start to go down. That is good news for italy, but also of course for the rest of europe, because that would signal where the end could be for the rest keeping in mind everyone is a little behind. Nejra maria tadeo in brussels. Great to have you with us. U. S. , House Speaker nancy pelosi has come out with her own 2. 5 trillion stimulus plan, an attempt to influence negotiations in the senate. It would grant a temporary reprieve for payments of mortgages, cars and credit card bills and would include aid to the airline industry. Annmarie hordern joins us from new york. Where are we with the stimulus stalemate . Rie another day that they were not able to agree on the stimulus relief bill in washington, d. C. The latest from politico, senator Chuck Schumer said likely, according to people familiar, we would see a bill on tuesday, and what is included in that, one thing the democrats have really pushed for, significant oversight on the 500 billion, the stabilization fund, and how corporations will use that money. We saw that in Nancy Pelosis bill, its really being used as leverage, no house numbers will come back and vote on that, but using it as leverage to get their point into the senate. On top of all this, we see the, this really implicating the markets. Yesterday, u. S. Equities ended the day lower on this. Theres been a lot of pressure to get this done, and more and more states are continuing to lock down. Yesterday we had massachusetts, indiana order shut downs. All the while, its clear the administration is having concerns and frustrations with this. President donald trump yesterday said that america was not built to shut down and it will not last 34 months, and then we heard James Bullard calling for the economy to be shut down for three months. Obviously its becoming very frustrating and controversial, you might say, in washington. Nejra annmarie hordern, thank you so much. The dollar weakness we see in todays session after 10 straight gains. Some optimism around stimulus, but mainly to do with the fed. Fedpresident said he called chair Jerome Powell to thank him for his efforts to fight slowdown by the coronavirus at break. The fed offered to directly finance u. S. Companies, jumping ahead of the government which is still struggling to produce a support package for american businesses and families. In a press conference, the u. S. President said the country is not built to be shut down. I am not looking at months. I can tell you right now. We will be opening up our country. We will be watching certain areas. We will be practicing everything deborah is referring to. We will be watching this closely. But you cant keep it closed for the next, for years, ok . This is going away. We are going to win the battle, but we also, we have tremendous responsibility. The hourining us for is andreas, chief strategist at nordea. Have we seen the last of the Funding Crisis and is the Dollar Strength we have seen behind us for the moment . Andreas i dont really think so. Obviously, the fed, its obvious qe want to go ahead with ternity, expanding the Balance Sheet to take steam out of the dollar. Im not convinced yet. Everywhere i look, the dollar looks expensive on other measures. S, the yen, in the libor dollar looks expensive everywhere. I look and i am not convinced they fed have done enough. What we need for Dollar Strength see economies back on track worldwide. As long as economies are in lockdowns, id assume the dollar remains strong, simply due to a lot of debt worldwide denominated in dollars. Nejra how can governments then perhaps offset the negative economic effects of lockdowns . Thats becoming a discussion now, something President Trump had been considering this week as well, perhaps alleviating the lockdown in the u. S. To limit economic damage . Andreas i essentially think its impossible. If we look at bullards plan proposed yesterday, he essentially said you need to do some sort of temporary universal basic income, close to the income level of employees in the economy, for at least three months. That is one way to mitigate the crisis, but it comes with large losses for capital owners, and thats essentially what we see across the board in asset markets these days. So it is not possible to mitigate the economic crisis unless you open the economy again, and i think thats why trump is looking to open the economy again, because he knows it will boost his election in november he knows he will lose his election in november if he doesnt open the economy in a couple weeks from now. Larsenandreas steno stays with us for the hour. First word news. China is lifting the lockdown on the epidemics center of wuhan. Transportation restrictions will be lifted and people will be allowed to enter and leave the province. The International Monetary fund says to expect a global recession this year, but the imf thinks that will be followed by recovery in 2021. Nearly 80 countries have asked the fund for emergency financing. The idea of a joint u. S. Saudi oil alliance is under consideration to stabilize oil prices, according to the u. S. Energy secretary. This suggestion comes as crude prices slumped amid the coronavirus pandemic and price were between price war between russia and saudi arabia. Coming up, ackman betys on a u. Recovery. The billionaire investor says hes upping positions in several american companies. The story you need to know, next on bloomberg. Nejra its bloomberg daybreak europe. Heres what you need to know. Bill ackman is betting on a economic recovery in the u. S. , telling Bloomberg Pershing Square covered its shorts and has reinvested in certain companies. We had a very large short in the credit markets. 97 of that was gone as of this morning, and we took the rest off earlier in the morning. We are all long. No shorts. Betting on the country. Here with more is my colleague, manus cranny. Good to see you. Tell us more about ackmans u. S. Recovery bet. Manus it was interesting that he lifted all his hedges. You think of the doom and gloom and despair from him last week and here we are, i am ripping off my hedges in the credit market, they are gone, and he is bet. N, a 2. 5 billion the nature of the bet is quite u. S. Centered. Lowes, berkshire hathaway, starbucks. The argument at the core here is these companies are fundamentally torn apart in valuation, that cash flow will return. He no longer has the short position. Whats interesting, when you lo minard, pre the fed announcement he said that bottom fishing is the most rldensive sport in the woi and went on to expand, may be capitulation had not happened. When you look at the different views, it is about what the fed is doing. Is it radical . Is it innovative . Perhaps the answer would be no, it is not, but when you look at the debate it is this. Waking up this morning, we have the fed narrative but also the political procrastination and prevarication on the fiscal side, and weigh that against the other aspect, the narrative coming from the u. S. Podium. So you have two powerful drawdowns on the market versus a powerful alpha. The question, will the alpha be drowned out by the other two procrastinators . Thats the issue for markets. Ackman is allin, hedges are gone and the names are quite interesting in terms of position. Im saying the fed, pg markets starting to feel a tsunami of liquidity, but jp morgan saying it may not be enough if the outlook worsens. In italy, the number of new coronavirus cases and deaths has fallen for a second day as germany seems ready to back a rescue plan. Berlins preferred option would be an enhanced credit line. They are not yet on board with the idea of jointly issued credit bonds. Andreas steno larsen is still with us. Lets first talk about the credit line via the esm, which could be a precursor to actually ich was never used during the crisis. Do you see that is the next logical step for europe . Andreas it probably is, but not the optimal solution. Eurobond would be a solution, but its a tough seven germany. Its typical of germany to try the first option here, with the program. I think its likely we see the esm in play over the coming its not the optimal solution. Common burden sharing is necessary in this situation. Nejra what would it mean for investing in europe if the landscape shifted that way . Credit price in more risk. Thats the move over the last five, six trading days. Have to take on more risk than the rest of the euro area in a bond situation. Nejra earlier, talking about the fed, you said they need to do more. What more do you expect to see from the fed . Some people out there say it may not be enough if the crisis gets eyve, but other say th throwing everything at this. Andreas my suggestion would be buy commodity futures. Thats one way to prop up expectations of inflation in addition to dollar liquidity. Its a good way to get dollars flowing around the global system globally, buying commodity futures. I know it sounds farfetched, but so did a 0 policy rates just a couple weeks back. So i guess that is my guess for the next step. Nejra you have a great note out, talking about the fact of the new realities of getting use to modern monetary theory and universal basic income. The landscape will shift in ways perhaps some of us cant imagine. Week,oking at pmis this what are you expecting to see out of europe . Andreas basically the worst figures since 2008. Italys pmi will likely look like chinas from february, under 35. In germany, id expect 40 readings, even worse than in 2011, 2012 in the debt crisis. So we will get a big test of whether we will get weaker pmis than postlehman, 2008. Nejra andreas steno larsen, markets, great to have you with us. There is Risk Appetite coming back into equity markets. Talking about a bear market. A low,equities hit dollar weakness dominating markets. We see oil gaining, gold extending. Coming up, pressure piles on as worsens. S in iran the u. S. Being blamed for blocking aid to the islamic republic. More on that next. Cehic in am nejra london. The fed pulls out all the stops, equities and futures gain, and the dollar loses king status at least for the day and gold and oil are rallying. Another impact from the coronavirus crisis, iran. The humanitarian crisis the coronavirus outbreak has caused is increasing pressure on the u. S. To ease sanctions. The republic leaders and some aid groups say the u. S. Maximum Pressure Campaign is worsening the disaster, while the u. S. Says it is ready to help and blames the countrys mismanagement. Is there a prospect we could see sanctionssed on eased on iran as a result of the crisis . Right now the rhetoric, if you can call it that, coming from the white house and secretary of state mike pompeo, has been very strong. He sounds is still quite determined to make sure the maximum pressure strategy the Trump Administration has been using against iran continues, and said a couple weeks ago they will continue doing that with sustained pressure. At the same time, in iran we had up until yesterday president Hassan Rouhani say they will not accept any aid or assistance from the United States. The rationale from the point of view of the government in tehran is that they dont want to accept something from the United States while the United States is kind of collectively punishing the country. Thats how they see it. He likened it to the Trump Administration offering a single glass of muddy water to the iranian people, while keeping them from accessing a freeflowing well of freshwater the rest of the world can access. So they dont see it as a genuine offer of help. They find it from their perspective, they think it is a very dishonest gesture, because they are still sanctioning iran, applying sanctions until last week. Nejra briefly, golnar, as russia, china and European Countries have been urging easing of penalties, what does all this mean for the leadership in iran . Golnar they are under a huge amount of pressure, as most countries are in the world, to face this thing. Irans relationship with china has been extremely important and key here. Unfortunately, its also been one of the reasons the coronavirus entered iran in the first place. Motevalli, thank you so much. Up next, the u. K. On lockdown for three weeks. We look at the impact on business. This is bloomberg. Nejra good morning from london, i am nejra cehic. Asian equities and u. S. Futures rise as the fed unveils unprecedented measures jumping ahead of congress as a government continues to argue over stimulus. President trump says the u. S. Is not built for a shutdown. The u. K. Becomes the latest to put its citizens under lockdown. Germany is ready to follow ready to help italy. And wuhan prepares to lift its lockdown. To daybreak europe peter carr lockdown whilets the u. K. Becomes the latest. The crisis causing countries to take unprecedented measures. We are seeing a little risk on coming into the markets as a result of that. Gains in u. S. Futures. A rebound from 2016 low in equities. Crucial, dollar weakness. Feeling a tsunami of liquidity. Jp morgan morning the measures may not be enough. Gold also continuing its rally. Goldman saying now is an Inflection Point and now is the time to purchase gold. Willentral bank says it dip its toe into the nearly 200 billion credit market. Here is dani burger with the details. David this was by far one of the bigges