Chinas economy contracts for the First Time Since at least 1992 after the coronavirus lockdown but industrial output numbers offer signs of encouragement. Stocks push higher as President Trump outlines steps to reopen the economy despite data showing 5 million more americans filed for unemployment. Plus hedge funds suffer a volatile march. And the worst ever losses posted. We will see this morning what u. K. Asset manager things. Breaking headlines on european car sales plunging 52 in march. European car sales more than getting cut in half in march yearoveryear. The biggest drop on record. We will be sure to talk a lot about cars today. Hsbc upgraded bmw shares to a buy. Anna a lot to talk about in terms of the car story an interesting to see the plans are around reopening car production. Let us talk about man group. The World Largest publicly traded hedge fund. Net inflows for the First Quarter, 5 million. Standing at 104 billion u. S. Dollars. These numbers are coming through. They are talking about negative fxects and other negative and other movements. Final dividend, Share Buyback program proceeding as planned which is interesting. Are callingsses into question buyback plans and share programs. On the market volatility around the virus. Dani burger pointed out the pressures. Coming a week or so after they had to close two hedge funds because clients were pulling out money and there was not patient money in there. Matt do not miss our interview with luke ellis from man group shortly after 9 00 a. M. U. K. Time. Let us get to the bloomberg first word news. Top stories from the terminal. Chinas economy contracted for the first time in decades in the First Quarter as a coronavirus outbreak shut down large parts of the economy. Gdp shrank six point 8 from a year ago, the worst performance since at least 1992 when quarterly data started. That missed forecast for just a 6 drop. 16 over theopped same. President trump has outlined plans to restart the u. S. Economy with some employers being encouraged to abandon restrictions in the next four weeks. The white house has been eager to let the country return to work after a total of 22 Million People file for unemployment aid in the last week. The u. S. Currently has over 150,000 Coronavirus Infections. Our approach outlined three phases to restore our economic life. We are not reopening all at once but one careful step at a time. Increased Coronavirus Infections suggest no let up as european leaders weigh in on lockdown measures here. New cases of the virus climbed in spain, italy, france, and germany. The u. K. Announced it is extending its lockdown by a further three weeks as its confirmed cases topped 100,000. In china, the official death toll has been increased by 40 . The extra numbers from wuhan were due to late reporting at the height of the outbreak. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. This is bloomberg. Anna . Anna let us get into the market conversation and bring our colleague into the conversation. Asian stocks climbing. Up 2 or 3 . Come tentative steps to restart the American Economy. Theased approach president giving governors the ability to see that. Traders looking past a lot of chinese data. Let us get into that conversation with mark cudmore joining us now from singapore. Interesting to see markets have dataquickly put the china come of the weakest in decades in terms of gdp into the Historical Data box and decided we do not need to trade around that now. We sit here in europe with information such as the car sales plummeting more than 50 . Will there be the same resilience or ability to say we knew this was coming . Mark for the chinese data, it is not that u. S. Equity futures have gained, it is just that there has been very little impact and that goes to what you are talking about everyone is saying we know that unemployment is surging, that is not where the debate of the market is between bulls and bears. Shorttermows the shock is violent. The debate is how long the shop well last and what will the secondary impacts be of those shocks to consumption and unemployment. And retail sales massively missed next rotations expectations. That is the general theme we are seeing. Areherrings factories reopening. It does not help if you do not have the consumer there. Boostnot that great of a getting extra supply if we dont have the demand to match. The data is negative. Car sales in europe not surprising. I think it will slightly erode sentiment. Last year was the first year in nine years that global car markets in march was not the record month. Clearly, march will not be a record month this year but it is also slightly deceptive. We did have this delay. Usually march is positive. This year they will not be buying because of the coronavirus but there may be a surge in cars afterwards because people will prefer private transport as opposed to public transport. Cars may make a strong recovery in the second half of this year. Matt i was talking to a friend on wall street yesterday, admittedly a person that does well in banking that he said look, i am refinancing my mortgage and looking to purchase a car. Interest rates will be rock for a while now and these are the times to do this kind of thing now. Will consumers have this feeling more broadly . In germany, we reopened Car Dealerships on monday. Mark it is a hard argument to judge. Where we may be slightly worried a perfect example of how traders being slightly disconnected to what is happening on main street and away from Financial Centers there are people not getting stimulus checks promised, there are people struggling to feed themselves, there are people that will not have jobs to go back to once stimulus runs out which will be a problem. Unless all the jobs come back in the next few months which is unlikely. The financial industry, the journalism industry are good examples of exceptionally fortunate industries that can work remotely and they are not seeing that much damage. The risk that analysts in that sector are having is that they are underestimating the impact. I think the lingering impact on the consumers will be bigger than what some are seeing. Reopened buty have factory workers are not dining out at lunchtime. Lunchboxes andng this is a reopened economy. Consumer behavior has still changed. Will it be permanent . We dont know but the limbering lingering impact will be around for quite a while. Anna and even more so when you think about the reliance on Service Industries we are in western societies. Let us take a quick look at the numbers. Funds under management dropping by 11 quarter on quarter. The economy being resilient in unprecedented circumstances. It is worth noting ahead of the open but also because we will be interviewing nick ellis from that man group. Stay with us for that interview around 9 00 u. K. Time. Up next on the program, we will talk about what is happening with the fed and central banks. The Federal Reserve has offered a pessimistic view for the outlook of the u. S. Economy cautioning that a recovery will be strong will be slow to take hold. Our exclusive interview with the dallas fed president. This is bloomberg. Matt welcome back to Bloomberg Markets. This is the european open. We are a little over 45 minutes away from the open of cash trading in europe and the u. K. Todays top corporate stories from the bloomberg terminal. Jobs andd is cutting breaking with wall street. Sources tell us the private Financial Services firm will terminate hundreds of roles across the division. This would herald the deep cuts among Financial Companies since the crisis began. Cantor fitzgerald says it is being prudent in an uncertain environment. Climbingiences shares after reports of coronavirus patients being treated having rapid recovery. A trial in chicago was given to patients. The most patients were discharged from the hospital. Gilead had 4000 patients in the trial. That is your Bloomberg Business flash. Anna let us talk about the measures being taken stateside. President trump has unveiled guidelines on reopening gradually the u. S. Economy. The socalled opening up america timeline could allow companies to abandon their social distancing measures. Putting the onus on governors. The recommendations lay out a threephase process. Allowing for reimposing measures if infections start to flare up again. Let us get a market perspective on the latest developments in the fight against coronavirus. Good to see you once again. You have been suggesting recently that we continue to think there is positioning for a strong dollar being sensible. What does that look like now . Measures being taken to open up the economy. What would it take to change that dollar positive view . We see the dollar responding the most to this crisis and to risk sentiment. Recently, the dollar has weakened following the very aggressive policy response by the lockdown in many countries. A reason toever remain defensive. There is still on step there is still substantial uncertainty. Worsecession will be much than the 2009 crisis. And we do not have clarity on when we will be able to be released from this lockdown. Even when we will, it will not be a move back to normal. It is more likely to be [indiscernible] a very deep recession with a very weak recovery. As long as the uncertainty continues, we will remain risk of verse and we will be positioned defensively. Matt why do you think the recession or the recovery, i should say, will be so weak . You have so much for you have so much activity from the fed and the u. S. Government springing into action like never before and a president that really does not like having a strong dollar. The white house will try to fight against that, surely. A number of free zones. Look at the boundaries. And the exit plans. And itll be very gradual is not really a move back to normal. Or as there is a cure vaccine and the threat remains from the virus, we are not going back to the same situation. From lockdown, there will be some economic recovery but we are not going back to what it used to be. Second, the high uncertainty Means Investment will remain depressed which will have longterm implications. Investment growth will remain low. Alivel keep the economy during this time but it will not be a enough to really change the behavior of people as long as they are afraid of the coronavirus. From this point of view, it is unlikely that we will see the strong recovery we usually get after a natural disaster, for example. And the longer we are in this situation, the more we will have permanent damage in some parts of the economy. Permanentking of the damage, how do you expect europe to fair . To fare . Given the strong dollar, do you expect the euro to underperform . If not burden sharing, we could see some flare up in spread. What does that mean for the euro . We are more concerned about the eurozone. No matter the crisis, there will be a huge debt for the public and private sectors. In the case of the u. S. , we can think of a different scenario. , wehe case of the eurozone do not expect the ecb to keep buying bonds forever. And countries on the periphery theyitaly and spain will have years of austerity ahead of them. The plans in the eurozone so far i amress liquidity fully in agreement personally with president macron. Only [indiscernible] unless we move in that direction , fx at bankead of g10 of america, merrill lynch. Thank you for joining us. Boeing shares soared yesterday plans torm announced resume production in seattle. We will hear from our own interview with the ceo competitor from airbus on the challenges ahead for the company and the industry. This is bloomberg. Same view is basically the it was two weeks ago. I think we will have a substantial contraction in the second quarter. We have said publicly, annualized as much as 30 . And multiplied i four by four. We think we will grow in the thirdquarter and continue to grow in the fourth quarter. I would probably say today that peak unemployment may be closer to the mid to high teens come higher than i said before. And we still believe we will end the year with an and with an Unemployment Rate like 8 10 . In that range. The challenge going into 2021 will be to work that Unemployment Rate down. Ofthere seems to be a range views among the board and fed president s. Mary daly saying this could dragged into next year and another president saying this could be a sharp v where do you put yourself on this spectrum . Challenge, going into this situation, we had sluggish manufacturing and sluggish fixed investment. A lot of that had to do with weak global trade but we had a strong u. S. Consumer. A low Unemployment Rate. Household Balance Sheets were in reasonably good shape. That was 70 of the economy. The challenge is as we come out of this later this year and if the Unemployment Rate really is a percent10 , you will have a weakened consumer who will save , morebe more careful reluctant to spend and that will be a headwind for the economy and it may take a while and i mean into 2021 for the consumer to get his or her footing back. And i think that will be dependent on how weekly we can run down this Unemployment Rate to lower levels. Do i think it is going to be a v . I think the consumer situation makes me think we will have a recovery and it will be a solid recovery in the second half of the year from the levels where we are at. We will still have a 4 or 5 contraction but the question will be the pace of growth and what is the state of the u. S. Consumer . Those are the questions and those are the issues i am most worried about. The psychology of the u. S. Consumer is not simply to be more conservative but to be concerned about their personal safety. How willing will people be to go back out to restaurants and to go to spend will there be some concern because of safety . There are three levels of issues. Personal safety. That is why ubiquity of testing is so critical. If you had widespread taste , iespread testing at scale think that would do a lot to give consumers confidence to go into the workplace, to go into restaurants and other public gatherings. That is dependent on how available is rapid testing. Jobother issues our insecurity. I saw a survey from the new york fed saying Something Like 70 of all workers are worried about their jobs. Losing their jobs. There is that insecurity. The last issue is what has happened to the consumer financially and particularly that segment of the population, which is sizable, which does not have much savings and lives paycheck to paycheck. This will make it so they are even more cautious. Those are the three big issues that affect the consumer. Beyond the routine checkups. Beyond the notsoroutine cases. Comcast business is helping doctors provide care in whole new ways. All working with a new generation of technologies powered by our gigspeed network. Because beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected. To do the extraordinary. Take your business beyond. Anna welcome back to bloomberg. Rkets european open just under 30 minutes to go onto the start of European Equity trading. We will at least start looking generally pretty positive. Lets talk about what is to come on the agenda, whats on the radar for today. U. K. s handling of the coronavirus pandemic comes into focus with moodys set to announce its outlook on the countrys rating debt rating. The debt built in various economies. At 10 00 a. M. London time, we will get the euro areas inflation readings for march. We will also discuss u. S. Measures to irrigate mitigate the virus impact on the economy. Dont miss our exclusive conversation with the cleveland fed president. What does she make of the latest announcements . That interview after 2 00 p. M. Matt . Matt we have been talking about the airline industry. Clearly, it has been slammed by the coronavirus pandemic. Aircraft manufacturers are one of the first to bear the brunt. Boeing announced it will resume. Production of. Commercial airplanes. The airbus ceo spoke to us earlier to outline the challenges his companies facing. Here he is. We have to face a very unprecedented situation and we are facing that now. The situation of the airlines, our customers is a very difficult one. Most of them have their planes, to a large extent, on the ground. That is unprecedented on the global scale. Therefore, we have to adapt. We have changes on the supply chain. We are combining all of our debt to move forward. What we have done last week was to define a new production rate, a new production planning ane to be able to give the right production the right numbers information to our partners. We have to adapt to the new situation. What are you hearing from customers . So united in the United States a little bit earlier on saying that demand for travelers essentially zero demand for travel is essentially zero. What are you hearing . There is a large diversity of situation around the world. The situation is not the same country by country, airline by airline. What we have done to speak proactively to customers individually to find solutions one by one to their concerns. Actually, the situation is today what it is, you mentioned the situation of united. We have a similar situation with other airlines. It is a very complex situation. It is a lot of work for all of us to adapt and find the right way forward. There is still a lot of uncertainty on when airlines will be back to service, when we will be back to normal and what will be the shape of the recovery. That is what we are working on at the moment. What do you think of the state data being given to certain carriers . I think the priority is on rescuing the airlines. They are the first hit by this pandemic. Obviously, no passengers or very little passengers flying. The priority, my perspective is to support the airlines going through this very difficult situation. Supporting the airline is also the best way to support the world supply chain. We are looking very much on our customers, the airlines, as well as the rest of the supply chain to keep