Quickly after the crisis, as u. S. Jobless claims could hit in even bigger number than last week. And daily fatalities continue to rise in spain and the u. K. , as france proposes an economic rescue fund. Lets get the markets. Sixttle weakness in asia, a percent drop for the s p 500 over the last two days. Futures are positive, though, up over 1 , and european futures pretty much unchanged. Its difficult to look at fundamentals, for where equities go. A lot of people looking at technicals, saying there is a range we could fall into in the next few weeks. Is10 the 10year yield steady, but if we see a renewed selloff in equities could more money move into treasuries . The bloomberg dollar index is steady today with yen weakness. Have we found a floor on oil . We are bouncing back a little above 21 a barrel for wti. Now, a classified u. S. Intelligence report seen by bloomberg says china conceal the extent of the coronavirus outbreak within the country. U. S. Officials suggest beijing intentionally under reported total cases and deaths from the disease. The outbreak began in chinas Hubei Province in late 2019, but the country publicly reported only 82 thousand cases and 3300 deaths, according to data from Johns Hopkins university, half as much as the u. S. , which has the largest probably reported outbreak in the world. In a daily press briefing, President Trump echoed that view. Their numbers seem to be a little on the low side, and im being nice when i say that, relative to what we witnessed and what was reported. Coronavirus deaths in the u. S. Continue climbing sharply in the states of new york and new jersey, their governors releasing data showing doubling fatalities in the last three days. The new york death toll reached almost 2000 victims, while new jersey reported over 350 deaths. Orders and employment at u. S. Theyries contracted, as grapple with pandemic related demand destruction. The latest jump in supply shows. Joining us, our guest from dansk a bank. Thank you so much for joining us. We have seen a bad couple of days for the s p 500, but a lot of people saying we have not yet had true capitulation in the equity market. Do you expect that in the next couple of weeks . No. I think the capitulation on march 13, the 16th, 20th of march, i think were care the worst volatility through the worst volatility and two reasons for that. First, the fed has been very aggressive. And secondly, if you look at the number of new cases of the virus, it is peaking. So i think from an equity point of view, not saying it will fall or we will not have down days, but in terms of volatility and lows, it is a fair chance we have seen the lows. Looking at the s p. And in terms of volatility, i dont think we go back to where we were. Nejra interesting. The s p 500 would have to fall another 9. 4 to get to the level it hit on march 23. So if you think that perhaps we are not seeing a big capitulation to come in equity markets from here, what does that mean for fixed income . My question, if we see a further selloff in equities, does the money move to treasuries, does the 10year yield retest the record low of 31 basis points given what you just said . What you answer no would you answer no . Thomas i think fixed income is a little stuck. The 10year in the u. S. Trading around 60 basis points, there is massive q. E. Support. But i do think that would keep it stopped there, so you continue to see it stabilize, a little higher, but fixed income will be stuck around 60 basis points. Ijra forgive me, thomas, lost you there for a moment. We are having a few audio issues. I did not hear the end of your answer. But let me ask you about the u. S. Treasury play. Last week, we got that number that shocked the market and sell resilience in equities following that. U. S. Equities are higher right now, futures. Will we see the same reaction if we get a number north of 3 million today . Thomas yes, and thats a good point you are raising. That was interesting, we saw that number, for five or 10 minutes the market reacted negatively, but turned around. To some extent we know these data will be so awful, that we have never seen them before, but to some extent the market is aware of that. We know we are having a deep recession now, but at the same time you see Central Banks really stepping up, doing unlimited q. E. And credit easing, when it took them nearly four years during the Global Financial crisis. Interesting. So, we might see resilience in the u. S. Session today after jobless data. In terms of what is being priced into markets, whether a recession, a doubledip recession, a depression, all kinds of calls are out there for lshaped ushaped, recovery, the latest is actually a nike swoosh. What is priced into the market if that is possible to gauge in terms of recovery . Thomas thats a very good question. We are discussing that a lot. Say thewe see it, lets equity risk premium for example. There, you can say we are at lows, but not substantially beyond one standard deviation. The market is pricing a very alsorecession, but its important to note the market is not pricing a long recession. The market is to some extent buying into the story, that you will have some kind of recovery in the second half of the year and you have economies opening. What is the balance of risk here . The balance of risk, i would say if you look at it from a mediumterm perspective, i think equities in three to six months from now will be higher. I think the base case has to be that you have a very deep recession, but some kind of recovery in the second half. For whatever reason, if the virus comes back or we cant open economies, i dont think the market is focusing on that, the market is saying that cannot be the base case. Nejra ok. Certainly we saw jeff gundlach, howard marks, jim rogers focus on that much more pessimistic scenario yesterday. We will carry on the conversation with thomas for the rest of the hour. Great to have you with us. Thomas harr from danske bank stays with us. E. U. Nations are setting out competing visions of how to deal with the coronavirus pandemic consequences, as governments are at odds over how to cook cushion the economy. One key disagreement, mutual rising debt, which is popular in hardest hit countries like italy and spain, but germany and the netherlands are pushing back. In the u. K. , almost one Million People have claimed universal credit welfare payments in the last two weeks, up from 100,000 in a normal fortnite. The benefits are designed to help people if they become unemployed or are on low income. The surge coincides with when the u. K. First imposed dramatic restrictions on business and the public. President donald trump will meet with Oil Executives reeling from a massive drop in prices, as saudi arabia unleashes a record volume of crude, escalating a price war with russia. The president says he expects those countries to settle differences, saying they are negotiating at i think they will come up with a deal. The Federal Reserve is letting wall street banks take on more leverage, to deal with the severe lack of liquidity. The fed is making clear the move is for banks to expand Balance Sheets as appropriate, not so lenders can increase capital distributions like dividends. Global news 24 hours a day, on quick take powered by bloomberg powered by more than 2700 journalists and analysts in over 120 countries. Coming up, we hear exclusively from bank of america Ceo Brian Moynihan on why he expects the u. S. Economy to bounce back once the Coronavirus Health crisis is resolved. This is bloomberg. Manus this is bloomberg daybreak europe. Manus cranny in dubai with nejra cehic in london. A quick check on the markets. Downs innged close italy and germany, there is concern about the duration of the coronavirus hit. Our guest host has said he expects a deep contraction in the Second Quarter, then a recovery. Brian moynihan, optimistic. Theing at the money, in Second Quarter do you want to be long dollar or yen as your protective trade . Do we test 1. 3 . Leverage,tends the wanting wall street banks to extend leverage. After the rus, sians finally admitted they cannot produce oil at these prices. Bank of america Ceo Brian Moynihan said he expects the u. S. Economy to bounce back fairly quickly once the Coronavirus Health crisis is resolved. Take a listen. Brian as we went through january and february, we saw with Consumer Spending money at table ster rate doubledigit rate since 2019, so the economy will probably grow faster than people projected. Into march when you saw the situation, even with the impact in march, we will still see Consumer Spending in the aggregate on march, this is not a small sample, up for march, not a lot but two or 3 , and yeartodate up almost double digits. That is faster than last year versus the year before. Path, buty is on this as he watched march play out it has changed dramatically. So what the Federal Reserve did, starting a lot of liquidity programs to stabilize the markets, Congress Passing a steaming this bill to keep people employed. At bank of america, we told our teammates they have a job here and that is important. To the extent we keep people employed, keep cash going to households, that will be terrific and keep a baseline of the economy growing. The other question is how to help Small Businesses do that, and a program has been announced, beginning friday. The key to that, how do we get that money out quickly . The banking industry, on behalf of congress and the president and the administration, they developed a set of regulations. They are in process, they are starting to publish them. We just ask customers to be patient. My advice, go back to their bank who they already have a lending relation with, that kind of documentation. Work with those banks. We have customers come to us, and we will come through if they desire into the program, and it will be very good because they can continue to pay their employees. That is what it is designed to do, and also cover some of her cover some overhead to help Small Businesses. We are activating thousands of people to help take applications, a huge digital presence, and if everyone can do it in orderly fashion, it will be very good for the u. S. Economy. All of us in our own ways are trying to live daytoday, week to week and get through this crisis. Some economists are talking about possible demand destruction, permanent reduction in consumption because of the crisis. As you look at it, is there a risk of that . How large a risk . Brian at the end of the day, one of the things thats great, if you think about the throughput of the u. S. Economy, with the amount of stimulus, amount of fiscal support coming, amount of monetary support, if you look at economists, 25 down in the Second Quarter and working their way up, the sheer amount of dollars, 5 trillion, is overwhelmed by the amount of support coming into markets. All that is geared to getting faster. Theres no structural issue in the economy. It is a Health Care Crisis, and if you mitigate that you will see on the other side of this a rebound, what are economists say. As people adjust the Second Quarter down more due to unemployment, people are guessing that will happen this week, they will be a deeper downdraft, but most economists, economists, believe on the others of this is a reversion to where the economy almost gets back to the same size sometime next year that it was prior to this, which is a pretty fast turnaround. I think that thats the core belief. Because you arent changing anything fundamentally about the business cycle, whats going on. You are saying, if you get by this virus, it works. If you look at china right now, you see the data getting stronger. Are on the fact they others of the situation, and you are seeing, we are seeing when i talk to our commercial clients, the factories they work with are at 65 , 75 , seeing goods and shipments coming out of china, seeing factory start up even in some places that were most affected, people going out and shopping. The question, when the consumer feels comfortable going out, going to restaurants, going to shopping, doing things like that. That will come when the healthcare crisis is solved, and that obviously, theres a tremendous amount of talented people and the best health care in the world working on that every day. When that happens, that is when the behavior will come back and it is just a matter of how fast we can get there. Nejra that was bank of america Ceo Brian Moynihan. Lets continue with that theme of the shape of the recovery. Economists are serving up a menu soup. Phabet set to be the deepest recession since 2009. Here to discuss is dani burger. What letter it is supposed to look like, an l, w, u, n for nejra . One thing for certain, calls for a vshape have gotten fewer and fewer because this recession is so different from any other. A recession without a purpose. In other words, there is no excess buildup in the system, no bad debt that needs to be washed out through a session recession. Instead, the pace of the economy is almost totally dependent on what the virus curve looks like. Have slant upwards and more and more cases it could have lasting and dire consequences to the economy, but if the curve is able to be flattened, that means we can restart parts of the economy. Again, it was healthy before this recession, and we could see a sharper rebound. This is where you get the calls for the economy and stock market to come back more quickly, similar to what you see in china with pmis bouncing back pretty quickly. This is something ubs agrees with, the quality ushaped they call it a ushaped recovery, saying it will happen in the Third Quarter of this year or between the Third Quarter and the First Quarter of next year. I want to point out that the markets are doing not just what strategist are saying. Markets, notat necessarily a slow recovery or even a quick recovery. Instead, looking at december 2021 futures, more than a year out. 38 ently they price in a decline in dividend yields from the current level. I no means does that recovery in arnings, that oftem means not recovery in the economy, either. Quite a dire shape the market is pricing in when you look at those measures. Still a lot of uncertainty, so whether you are a bear or a bull on the current recovery, there is a lot to fret about. Manus thank. Not much v about those numbers, is there . Exclusive our interview with the ceo of qualcomm. Thats next. This is bloomberg. Manus this is bloomberg daybreak europe. Im manus cranny in dubai. London. Hic is in a red headline, china is to start buying oil. We know the storage bins are getting pretty full, could run out of storage by may, and that would take oil comfortably below 20 according to bank of america. Extendednd italy have lockdown measures until after easter, and spain reported its deadliest day yet with 864 fatalities and confirmed cases topping 126,000. German chancellor Angela Merkel said infection rates had gone down slightly but cautioned it is too early to relax strict rules on public interaction. She also said working with german auto officials to find a way to restart assembly lines, there are concerns some cash strapped may not survive the pandemic, which would spell disaster to the countrys fine tuned and supply chain when it comes to restarting operations whenever that is. It comes as european leaders still struggle to come up with a joint response to counter the Economic Impact of the virus, with competing visions from france and the netherlands. Officials find it unlikely thomas harr from danske bank is with us. You have the ecb firing bazooka after bazooka, and yet there is no common fiscal response. This is what they say runs the risk of a new sovereign debt crisis, if sovereigns do not one up with joined thinking fiscal response. How big a risk is it that we get another sovereign debt crisis . Thomas i think for me, you can differences the key compared to 201112, what the ec b has done. They reacted much faster, where they took years during the last crisis. But i do agree, there should be a common response, because you shock, so you should have a common instrument like the ecb has done. This is not only the debt to gdp problem, but you should say, commonuld see a response. Its not only about a new debt crisis, but if you have a new prolonged European Growth crisis, and that is where i think a common fiscal response, whether it is esm or something else, i think it makes more sense. Nejra yeah. Response,common whether it is coronabonds or esm credit lines, what is the Market Pricing for is most likely . Is looking atrket some kind of esm measure. Littleket is still a skeptical about coronabonds. Esm saying head of that would take years. But there is, the key is of course as always the germans, but you saw the french propose and also the dutch Prime Minister propose a much smaller deal. The numbers circulated were Something Like 26 billion euros, way too small. But there is hope something would happen at the Euro Group Meeting in the next week. But i think coronabonds, how you call it, is unlikely. Nejra thomas harr from danske bank stays with us. Coming up, we hear what the boston fed president had to say about when we can expect the coronavirus lending plan for small and mediumsize businesses we discuss more on the markets next. This is bloomberg. Manus good morning from bloomberg middle east headquarters. Daybreak era. Your top stories this thursday morning u. S. Stock futures rise after the s ps worst drop in two weeks. New york and new jersey debt doubled in three days. U. S. Officials suggest china concealed the extent of its outbreak. Bank of americas ceo expects the u. S. Economy to bounce back quickly after the crisis. Todays u. S. Jobless claims could post an even bigger number than last week. Italys death rate eases as growth in new cases mo