With Second Quarter volumes that may fall as much as 25 . Ap mollermaersk, the shipping company, said Second Quarter volumes will take a huge hit. You see a top german judge, one top german judge says the ecb is not the master of the universe and must be held accountable. This is Angela Merkel and Emmanuel Macron agreed to open the france germany border. U. S. Medical advisor Anthony Fauci ways in on the Market Sentiment, warning against reopening too soon. Stanley druckenmiller adds to the downbeat tone, saying the equity risk reward is the worst hes ever seen. Finally, a loss in the First Quarter. Putting aside one third of one billion euros for virus provisions. We speak with the chief Financial Officer between or lot in the next three minutes view minutes on the effect of the coronavirus. Ap mollermaersk, First Quarter revenue beating the estimate. 10 billion. 9. 57 billion in the First Quarter at maersk. The estimate was 9. 36 billion. The ceos who we are going to speak with momentarily. Operating earnings rose by 23 . Quarter is where people are focused after the lockdown said in in the Second Quarter. Volumes may fall by as much as 25 , according to maersk. The company has planned further reductions for the remainder of the year. We will talk to him in just 30 minutes time. Lets get into the u. K. Breaking across the bloomberg terminal, numbers for the First Quarter. The u. K. Economy strength shrank by 5. 8 in march. Thats a month on month figure. The estimate was for a drop of 7. 9 . Thats just for the month of march. If you look at the whole quarter, it shrank by 2 in the First Quarter from the previous quarter. Thats the month on month number. The economy shrunk by 1. 6 in the First Quarter versus a year earlier. A host of figures pointing downwards as you would expect. But number for march, 5. 8 retreat month on month. An estimate for something bigger than that. We went into lockdown on the 23rd of margin u. K. We had Something Like normal conditions. The lockdown tension was building. Life was not that normal. Overnight numbers from the brc, the worst april since records began. Shows a drop in march of 53 in terms of spending. The clues were all there that we were going to have something pretty devastating for march and a lot more so for able. Shrinking 5. 8 y in the month of march. Better than estimated but it is still a sizable contraction. Lets get into the conversation about these markets. We are joined by our emerging markets strategist for bloomberg, simon flynn. Economy, people are watching these figures for march and for the First Quarter. Thats all very well but we know that the merce worst is to come. Simon you are absolutely right. We had awful pmis in april. Its reasonable to expect that the q2 gdp contracts by double digits. Significantly worse than these q number q1 numbers. Route, we have very tough looking brexit negotiations in the second half of the year. Its difficult to see anything other than a really jacket, jagged, sawtooth recovery for britain. Matt what do you think about the prospect of more tariffs . This is an issue with britain and the eu. Maybe an even bigger issue with the u. S. China relationship and the global economy. Simon yes, definitely. Certainly u. S. China is most important for potential tariffs. I personally put the risk of before thearound 30 president ial election. Of course, tariffs make almost no economic sense for either side. There is a political imperative that donald trump has to Pay Attention to. If hes concerned about his poll perceiving to be tough on china, theres a risk. Heading into the november elections. Focus onres a real how long these lockdowns last. The global risk story, really interesting to see. James bullard talking yesterday about how he sees lockdown in the u. S. Lasting more than 120 days. That risk is something that looks more like a depression versus a recession. This is the kind of difficult decisionmaking that is ahead for the u. S. It is warned that lifting lockdown measures to early would be disastrous. I guess that markets are still hooked to this kind of detail around the u. S. Lockdown. Simon absolutely. That was the major region why markets reason why markets had such a tough overnight session. This morning by Anthony Fauci that we could see a significant increase in infections if we exit lockdown times prematurely. That will be my major focus. To some degree, for developed markets, it is better to make a down payment in terms of lockdown extended rather than reopening prematurely, having second waves of infection, and then increasing shutdowns. Matt thanks very much for joining us. Bloomberg emerging markets strategist simon flynn talking to us about some of the most important issues of the day. Setting up for trade. That fed story is pretty amazing. Large has come out strong on the lockdown. To its drawing on the need ease it up. There we go. We are going to continue covering this market for you. A lot going on today as the equity route rolls around the world. This is bloomberg. This is bloomberg. Matt welcome back. This is the european open. We are 50 minutes away from the cash open. Lets get the bloomberg first word news. Your top stories on the bloomberg terminal today. The European Central bank isnt a master of the universe, thats a quote. To the germanng judge who drafted the opinion on the banks quantitative easing program. He told the german newspaper, the court isnt making a huge demand of the central bank. Its just asking for it to take responsibility for the qe program and explain it to those negatively affected by it. Easing of the uks lockdown begins today with what Prime MinisterBoris Johnson has called baby steps towards reopening the economy. And england, people will begin to spend unlimited Time Outdoors and those who cannot work from home are being encouraged to go to their jobs. Meanwhile, the government has extended its furlough scheme until october. That total cost to reach 84 billion pounds. Twitter says its employees will be able to choose to work from home permanently when the coronavirus outbreak finally receives. The Company Staff is unlikely to reopen its physical offices before september. After that, most can work from wherever they want. Put employees around 5000 people in 35 offices around the world. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. Anna . Anna lets get the latest on the disease stateside. Has warned against reopening the economy in the u. S. Too soon, telling a senate panel that communities doing so risk new coronavirus outbreaks. There is a real risk that you will trigger an outbreak you might not be able to control. Back. T, it will set you not only leading to some suffering and death that could be avoided, but could even set you back on the road to try to get economic recovery. It would turn the clock back rather than going forward. Anna joining us now from new york, annmarie hordern. Great to have you on the program. Worst welling on what Anthony Fauci had to say. It was some of his commentary that spooked the markets a little bit. It took the edge off of some strength and led to selling. A little bit of risk reassessment. What did he have to say to the Senate Committee . Annmarie it was a different tone than what we saw 24 hours before that when President Trump claimed, we have prevailed. These are his top health at sports experts. They are warning of possible new outbreaks. It weighed on the markets. Communities look to ignore the federal guidelines for reopening and are in danger of new outbreaks. Thatys theres a real risk you could trigger an outbreak that you would not be able to control. There was a tone of caution from dr. Anthony fauci. Our data set showed last week, 20 states are working on lifting restrictions that dont meet those white house guidelines hes talking about. They are moving forward anyways. Thats what hes cautioning about. We heard from robert redfield. He said we are not out of the woods yet. A different tone than what we heard from the administration. This was in front of a Senate Committee. You might democrats and republicans. There was a moment getting a lot of play between fauci and ron paul of kentucky. It got testy. Tall was paul was concerned about schoolchildren not going back to school. Fauci said, we have to be careful and not think that children are completely immune. Ron paul said, fauci should not be the endall beall on this issue. Fauci responded to that specifically. He said hes just giving his best scientific evidence. Matt thanks very much. Issue thatn the looks to have set equities on a downturn, starting in the u. S. We are seeing it come around asia and european futures. Coming up, commerzbank took a 479 million euro hit to deal with the fallout from the coronavirus crisis. We will find out more in our upcoming interview with the chief Financial Officer of commerzbank, bettina orloff. This is bloomberg. Welcome back to Bloomberg Markets. This is the european open. We are just about 40 minutes away from the start of cash equity trading. It will be a down day. Futures down about 1 acrosstheboard on European Equity indexes. In frankfurt, commerzbank took a 479 million euro hit to deal with the fallout from the coronavirus crisis. Joining peers in marking down assets and boosting reserves to deal with bad month. The frank for based bank said more than half of its 326 Million Euros in credit provisions were directly related to the outbreak. We are joined now by the cfo out of frankfurt. Thanks so much for joining us. Let me ask you about the other part of this hit. In the 295 Million Euros. Alue of customer derivatives explain what that means. Dr. Orlopp its twofold. Widened on the customer derivatives. Thats one side of the story. The other side is that we had crosscountry topics on the treasury side. Matt investors are always trying to gauge what is the picture now, what is it like in this quarter. Surely you will take bigger loanloss provisions again in the Current Quarter. Are we likely to see another big number in the reduction of customer derivatives . Mean, we are pretty confident that we will see a recovery. We have already seen that in the past weeks. That is one part of the story. It is attributed to the coronavirus crisis. Approximately 11. 4 trillion euros until yearend. Side of on the one lockdown, which is important. Matt what are you expecting in terms of loans . Have somewhat of a ushaped recovery, there are bound to be a lot of bankruptcies or delinquencies at the very least. What is your expectation for this year due to the pandemic . Dr. Orlopp i mean, we looked at our portfolio. We have a well diversified portfolio. We will see hits. We should not forget that we have the benefit to be in germany. We have the most comprehensive Government Program possible. We will see hits, specifically the ones who had troubled Business Models beforehand, also increasing increasingly having problems. That is why we forecast something around 11. 4 billion. This is more than we predicted at the beginning of the year. It is quite an increase in comparison to our original guidance. Matt absolutely. You already planned cost cuts. You have a plan in operation right now. Last year, you announced you would cut 20 of the branch network. I wonder what you your thinking is currently. More people, even germans, are switching from cash to digitalization. A lot of people are doing their banking from home or remotely rather than going into branches. Do you see that plan being accelerated to reduce your widespread branches in germany . Dr. Orlopp we absolutely will. We are seeing a change of Customer Behavior at the moment. High in ourltime mobile banking up. 50 above the 2019 average. Behavior is changing. We are analyzing the situation. Also the impact on our Business Model. We will adjust to it. Customersent that will stick to this behavior even if the crisis and. We will take that into account. Matt you are planning to unveil new cost cuts at the end of the summer. Youve hired mackenzie to review your Business Model as well. Has that changed during this crisis . About a changeg to the strategy at the end of august, beginning of september still . Dr. Orlopp we announced it already in february when we talked about our 2019. We are looking into more costs again. We will definitely increase our profitability target. Corona has added some new life on it. We will incorporate that. We will update you for the summer. Tot have you been able reduce the stress on your staff due to the Government Programs that we have seen . We heard from Deutsche Bank today that they are going to reduce their headcount now as the worst of the pandemic is past. Is that true at commerzbank as well . All, imp first of really proud of our staff. Working0 of our staff remotely. Operations were fully stable. We still have lots of customer respect toth corporate clients. Our customers will remember that after the crisis is over. We are having our strategic plans. We launched a Cost Reduction program in september. We have a plan for that. We just sent out the letter for which we have just started. Eligibled out to 2000 employees and colleagues. We expect the feedback on that in the summer. Onwill start negotiations further headcount reduction in september this year. Matt let me ask you about your one ratio. Youve said that you expect it to be at least 12. 5 by year end. That is pretty punchy. How do you come to that . Dr. Orlopp first of all, our original guidance was 12. 75 . Tolowered that down to 12. 5 take into account the relief we got from ecb with respect to our buffer and the guidance they gave us. They have a pretty comfortable situation. 13. 2 capital ratio. That gives us a lot of leeway to stand by the side of our clients and support them in whatever they need to do over the next months. Matt thanks so much for your time. Really appreciate it today. The cfo of commerzbank. We wish you well. Up next, shipping slowdown. Mollermaersk these volumes falling as much as 25 in the Second Quarter. We speak to the ceo, next. This is bloomberg. Staying connected your way is easier than ever. Youre just a tap away from personalized support on xfinity. Com. Get faster internet speeds with a click. Order xfi pods to your home in a snap. Or change your Xfinity Services with just a touch. All in one place. Youre only seconds away from all of that on xfinity. Com. Faster than a call. Easy as a tap. Now thats simple, easy, awesome. Matt welcome back to Bloomberg Markets. We are 30 minutes away from the start of cash equity trading. Theave 1 or more losses on major indices in terms of futures here in europe. Of course, we had a big loss in the u. S. Yesterday. The market fell the most it has in at least a week, more than 2 on the s p 500. Markets in some asian equity indexes were down as well. They have since recovered. That is important to point out. We do see gains in the asian equity indexes that are open, and as a result, we see futures not hit quite as hard in europe, still down by 1 . Let me tell you the top stories you should be watching. The European ExecutiveCommission Vice president will ecs travel and tourism roadmap. German chancellor Angela Merkel will give an update on the coronavirus pandemic can answer lawmakers questions. Topics are likely to include plans for relaxing the lockdown. Also, corporate rescues, including that of Deutsche Lufthansa and automakers subsidies, as they are taking a big hit. In the u. K. , Boris Johnson will pmqs, his first since changing the lockdown rules. Later, fed chairman Jerome Powell discuss Economic Issues via webinar, hosted by the Peterson Institute for national economics. Finally, an address for the european are limits on the parliament on the blocs recovery plan. Speaking of automakers, makinggens has resumed volkswagens luxury arm lamborghini has resumed making cars again. Lamborghinis ceo spoke with bloomberg about the demand for luxury cars as more countries are reopening their economies. I thick there is one thing we need to consider. As you are saying, we are 95 exports. China is growing rapidly. One important factor, we did not receive any customized orders. I can say for the majority of our customers that there is not a problem of liquidity. The environment for purchasing luxury goods like a car. If everything is closed, it is hard to buy. In south korea, the demand is soft. Week where i would say again. Pen [indiscernible] i can believe that the segment that will be good after the first month or week is the [indiscernible] we need to understand how we can deflect in order to foresee bigger demand next year. Good, but its very is important now that the markets react the right way. We launched this week a [indiscernible] we had a great success. We hope it is a reality. Stefano come up when do you anticipate italy will be out of recession stefan