Transcripts For BLOOMBERG Bloomberg Markets European Open 20

Bayer is learns that in the process of selling the roundup lawsuit, up to 85,000 suits could be resolved. We are just under one hour away from the start of your cash trading day in europe. A much ameliorated session in terms of liquidity. European stocks futures little bit higher by. 8 . The narrative is clear. It is the easing of the locked down from australia to japan. Japan is expected to lift the state of emergency. That along with the north of italy having almost zero infection rate, the lowest since early march, really changes the narrative. What is the pathway to reopening europe . The dax is up. A oneoff emergency fund. The narrative has changed. Stop futures are higher around europe. To the german data. Let me bring it to you. The gdp for germany quarter on quarter, this is the final reading, by the way, collapses by 2. 2 in the quarter on quarter. The year on year down 2. 3 . What is interesting in regards to germany, there is the dax over 1 , bloomberg expects the economy to contract by over 5 . The fiscal response is probably the most important one. 250 billion euros. This is the gmm. The japanese markets are higher, and on the currency side, you have citigroup joining jp morgan, being slightly off in terms of the emergingmarket. Seeing commodities rise. Thisas ramped up by 75 month, but you can see on the f export some of the em fx, a little bit more under pressure with the south korean won getting battered again. Lets get you up to speed. 7 02 in london. 8 02 in paris. The first word headlines. Protesters in hong kong have held their biggest rally in months. Police arrested 180 people after using tear gas and a water cannon. It follows chinas move to crackdown on dissent in the city. A new National Security legislation. It has been described as the biggest loss of autonomy for hong kong. China took control in 1997. China is warning that some u. S. Politicians are pushing the nation into a new cold war. The comments came from the foreign minister, who said the u. S. Should give up on its wistful thinking of changing china. The relationship between washington and beijing has worsened in the past few months. The white house has repeatedly blamed china for the coronavirus outbreak. Johnsons senior aide is facing growing calls to resign. Dominic cummings allegedly broke lockdown rules, traveling 250 miles. His family were supposed to be selfisolating. The government says the trip was to take care of his fouryearold child, calling the action sensible and defensible. 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. Lets mix up these markets. Asian stocks rallying. Traders weighing more signs on the economies reopening around the world versus the u. S. China tensions. Simon flynt is our emerging markets strategist for bloomberg news. Simon, if you look at the em currencies base, that is worried by china but if you look at the equity space, that is absolutely, resolutely focused on the narratives about reopening and the dissipation in covert cases. Good morning. Simon good morning. You are absolutely right. I mean, i do think the announcement made at Chinas National Peoples Congress will have an enduringly negative impact. They under delivered on economic stimulus, and they overdeliver it on geopolitical tensions. I think this is a story that is going to run for weeks, if not months. And the yuan, i mean, we had a red headline, the since 2008. Look, macquarie and a number of others are all saying this is , the control and contain worst case outcome. What does it say to you and is it a process of control . Simon in terms of the remember the fixing remember the imbi fixing, it was stronger than the bloomberg survey. We certainly had a few days last been more it had substantially below, but again, it was not efficiently different from expectations to be sending a strong signal. It looks like, for the time being, that the chinese are willing to accommodate some weakness and that is perhaps surprising. Maybe this is commensurate with the very large Market Reaction you wereeen, as suggesting earlier. The introduction of the hong kong National Security law really is very substantial change in geopolitical terms, and with respect to the fall and fiscal expenditure. His was actually quite significant. I was reading some barclays research, for example, suggesting that the consensus derived mostly from bloomberg was affecting a real fiscal deficit that had been around 10 of gdp, as barclay counts, and a of gdp. 8. 4 percent very significant geopolitical and economic events, and for the time being, it looks like china is accommodating somewhat through the fixing. Off. simon, lets close to imagery, again, going out the world is demonstrations in a covert world on the streets of hong kong. My guest in the last hour said we are seeing from the extradition risks last year that this new risk for hong kong putting legislation through without going through the legislature is a new paradigm shift. Does that shift the narrative on the hong kong dollar peg . No, i simon simon dont think so. The hong kong dollar peg has survived some exceptionally severe crises and this is nowhere near as significant as that as of yet, so no, i think not. Having said that, yes, the process will probably continue. Today was calmer, is my understanding, particularly as we approach the june 4 anniversary. That will almost certainly pick up, and then of course, you have the september ledge co. Elections in hong kong and this is the first big electoral collapse since the collapse in the progovernment vote in november 2019, so things look worse, but to answer your question, i dont think any hong kong dollar peg. Simon, for bloomberg news, the latest on the new flows across the markets this morning. Coming up, tensions we escalate between beijing and washington. Chinas foreign minister said some u. S. Leaders are pushing relations close towards a new cold war. What does that mean . We will discuss that next with a head of Economic Analysis right here on bloomberg. Manus welcome back. To the European Market open. A. M. Euro stoxx 50 is up. 9 . Things are improving in the north of italy. That is the key. What will germany and france do in terms of stimulus . The frugal four of the e. U. Proposal. One off to your emergency fund. The narrative is shifting from the likes of austria and the likes of those Northern European states in terms of what they are prepared to countenance for europe. Let me get you up to speed with your business flash this monday morning. The top corporate story hitting the news about today. Bayer looks to have made progress, having claimed its roundup weed killer causes cancer. It reached vulnerable verbal agreement. 10ayer bayer part ofs billion plan to end the costly in june. Tle, sources tell us that it is poised to replace its chief executive. Named as the carmakers new boss later this week. Aston martin has said this month fundsd to raise more and cut costs. Ryanairs warning on the collapse and air travel. The airline is left with more than fix hundred cap and crews in spain. That does not mean they are going to lose their jobs. Europes biggest Lowcost Airline is looking at lower pay to reduceime work layoffs. They are looking at 40 of usual capacity. That was your Bloomberg Business flash. Tensions are rising on the streets of hong kong. You have investors seeing profitable stocks in china. Capital,us of mobius spoke to bloombergs alix steel about the chinese opportunities. Theres no question that tensions are rising, and of course, these tensions have been going on for quite some time. In the beginning, with this trade war, and a number of other factors, so we cannot expect to let up in this kind of tension. Nevertheless, there are lots of stocks in china that can be purchased that are very profitable and growing despite all the problems we have seen, so i think we have to take it stock by stock rather than making a general picture of the chinese market. Understand how that plays into what the government is going to do in terms of stimulus. Mark number one, we are looking at stocks that are not going to be impacted by the trade war. That is number one. Number two, we are looking at rocks that have a global footprint. You have many of these chinese stocks alibaba is the obvious one. In addition to having this incredible market share in china , and then number three, we want stocks that have very, very strong balance sheets, and at this stage, we have to have companies that are able to gainre other companies and the market by doing so. Can you give me some names . All you wind up hearing about our Chinese Companies and how much debt they have and how much help they will need from the government, so what are these names . Mark for the normal investor, names like alibaba would be the obvious one, but there are a number of others similar to that in that category. I cannot give you names because we may be buying. I do not want to be in that position. Generally speaking, any of these tencent,e alibaba, these are companies to be looked at. Alix fair enough, if some of those companies, the big ones, like alibaba, gets delisted from the nasdaq because of these trade tensions, does that affect how you think about them at all . Alix not really. Mark not really. Congress will pass the bill about Accounting Practices. The Companies Listed in new york have to follow u. S. Accounting. That will not be a problem for these companies because they are already doing international accounting. It will be very easy for them to come up with the right Accounting Practices so i do not see that as a big problem. I think what you have got to see ofany problems in the face banks as regards to technology. That is an area to be very cautious. Even there, if you look at a company like tsmc, they will be able to survive any problems with the market in china simply because they are a Global Company and supplying people many of thecluding u. S. Manufacturers. Alix are you worried we are going to see any supply chain shift that we were talking about accelerate because of the rhymers or does it not matter as much if you are looking at the right kind of companies that would be more immune to Something Like that . Mark this is already taken place. You must remember it is not only the American Companies that have a supply chain problem, but it is the Chinese Companies as well. They have to now look afield out of their own area to find out where they can get their supplies, and they are not going to be sanctioned by the u. S. In one direction or another. The interesting thing that is happening is many chinese manufacturers are moving outside of china to manufacture in other countries so that they can get under the u. S. Trade area. Though thats another thing you have to look for, and we are looking at such companies, companies that are strong in china, moving globally, becoming more the Global Supply chain company. Mark mobius is from capital partners, cofounder and partner. Coming up on the show, europes largest economy shrinks the most in more than a decade in the First Quarter as germanys coronavirus lockdown hits activity. We discuss right here on bloomberg. Manus welcome back to the open. 7 19 in london. This is how the futures are looking at the moment. You have got a strong zone across the complex. Toer with a deal to sell up 80,000 of their lawsuits. You have this narrative around the world from italy, australia, to japan, about reopening, reengaging, allowing people to congregate. That changes the consumer narrative. That changes the overall l, u, maybeom towards a v. The ftse is closed today. It is a national holiday. Up 1. 8 . Lets talk about germany. Just had the data through. The economy shrank by over 2 . Could much expected. The final reading affecting the disruption from measures to control the spread of the coronavirus. The euro areas biggest economy held up. The lockdowns came a little bit later and they were less stringent, but the Second Quarter is likely to record a bigger hit. Christopher is the head of macroEconomic Analysis at saxo bank. Great to have you with us. The contraction was 2. 2 percent, the final reading of the First Quarter. The question that comes to mind, we expect bloombergtv contraction of around 5 in germany, but we are looking at the stimulus of nearly 8 of gdp. Is the remedy big enough for the pain of contraction . Christopher good morning. I think what we need to expect in the coming months, especially the Second Quarter, the pain will be deepened in the German Economy. We expect the complexion than the Second Quarter could be around 7 , which is already kind of huge compared with the overall crisis, and for the world, we expect the complexion to be around a percent, but at the end of the day, germany will cope with the situation much better than much of the other countries, especially italy. As a matter of fact, what we know is germany has massive stimulus. This could be another step in terms of stimulus, which is the good news. The management model in germany the deal with workers and employers, they are working all together. It is usually a good way to protect people. On the whole, i would be much more optimistic over the German Economy than the other economies. That. 5he narrative trillion euro package, that is being debated about getting europe up, running, and recovering. The frugal four, as they are referred to, are talking now. Austria, denmark, the netherlands, and sweden. They are talking about a time limited emergency fund. The narrative has shifted from the austrians. You take part from that . Heart from that . Is that why we have seen a substantial response from markets this morning . Christopher everyone over the countries that are against the Franco German proposal. As a matter of fact, this is bad news. We know it will take a lot of time before we manage to convert the Economic Situation. Variety between france and germany on one side, and italy and spain. All three areide, benevolent, especially, but do not want to move forward. Would be one of the economies that will exist my biggest fear is that we will end up with lots of political bargaining in the coming weeks, which will have a negative impact on the Economic Situation. It will take longer to recover when any of their country United Kingdom yes . Variousook, you look at moments in history, whether it was europe raising rates into the crisis. I mean, splendid moments of misunderstanding the situation, from lehmans to a whole variety. In the world does not have time to really prevaricate endlessly about what needs to be done, does it . And europe certainly does not. Christopher completely. We know the situation on the ground. We know it will get worse before it gets at her. Politically, we need to tackle the Economic Situation quite fast, meaning germany and france, but also the netherlands, needs to find an agreement and have a peaceful package that is big enough to tackle the situation. The problem is theres too much political noise, too much political discussion. We have to move fast in a period of crisis. Christopher, thank you very much. Yes, the graveyard of policy error is quite full. Christopher dembik, head of macro economics, analysis, over at saxo bank. Thank you very much for being with us this morning. Up next, we are going to talk about the china National Peoples congress. The discussion. Was the stimulus enough . That is the question. Barclays has a note out this morning. We talked about it on the mliv team. Npcfiscal response from the was simply not enough, but of course, there are other moves afoot in regards to the political swagger by xi jinping over hong kong. What does it mean for global geopolitics . That is the question. There is no gdp number from the npc, and of course, that has many ramifications for those that benchmark lowball growth to the target set by china. Beijing forive to the political ramifications, the Economic Impact of an npc that was quite explosive, to say the least. 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. Manus 30 minutes away from the start of cash trading around your. The u. S. Is on vacation and the u. K. As well. Memorial day in the u. S. And may day in europe. The debate about the stimulus construction. Australia reopening. Gatherings, more than 20. Japan, the state of emergency being lifted. Shiftingbout narrative to normalcy whether it is in the u. S. Through to japan and australia. Is way over the sinou. S. Discombobulated and that is an overstatement. The ecb president will unveil the Central Banks stability review. The last release warned about the side effects of negative rates but hopes of policy normalization have not disappeared. There is a longawaited recovery fund. It will lay out the proposed measures to support Member States in the worst recession in living memory. Later in the day, the fed will debate the beige book giving a snapshot of the current conditions. And the age close speech closing the National Peoples congress in beijing. Stimuluss are seeing measures being held in reserve. First day of the meeting dispensed with the explicit target of gdp growth but otherwise stuck to a path of moderate support to the economy. Let us get to beijing now. We have my colleague and cohost of National Security<\/a> legislation. It has been described as the biggest loss of autonomy for hong kong. China took control in 1997. China is warning that some u. S. Politicians are pushing the nation into a new cold war. The comments came from the foreign minister, who said the u. S. Should give up on its wistful thinking of changing china. The relationship between washington and beijing has worsened in the past few months. The white house has repeatedly blamed china for the coronavirus outbreak. Johnsons senior aide is facing growing calls to resign. Dominic cummings allegedly broke lockdown rules, traveling 250 miles. His family were supposed to be selfisolating. The government says the trip was to take care of his fouryearold child, calling the action sensible and defensible. 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. Lets mix up these markets. Asian stocks rallying. Traders weighing more signs on the economies reopening around the world versus the u. S. China tensions. Simon flynt is our emerging markets strategist for bloomberg news. Simon, if you look at the em currencies base, that is worried by china but if you look at the equity space, that is absolutely, resolutely focused on the narratives about reopening and the dissipation in covert cases. Good morning. Simon good morning. You are absolutely right. I mean, i do think the announcement made at Chinas National Peoples Congress<\/a> will have an enduringly negative impact. They under delivered on economic stimulus, and they overdeliver it on geopolitical tensions. I think this is a story that is going to run for weeks, if not months. And the yuan, i mean, we had a red headline, the since 2008. Look, macquarie and a number of others are all saying this is , the control and contain worst case outcome. What does it say to you and is it a process of control . Simon in terms of the remember the fixing remember the imbi fixing, it was stronger than the bloomberg survey. We certainly had a few days last been more it had substantially below, but again, it was not efficiently different from expectations to be sending a strong signal. It looks like, for the time being, that the chinese are willing to accommodate some weakness and that is perhaps surprising. Maybe this is commensurate with the very large Market Reaction<\/a> you wereeen, as suggesting earlier. The introduction of the hong kong National Security<\/a> law really is very substantial change in geopolitical terms, and with respect to the fall and fiscal expenditure. His was actually quite significant. I was reading some barclays research, for example, suggesting that the consensus derived mostly from bloomberg was affecting a real fiscal deficit that had been around 10 of gdp, as barclay counts, and a of gdp. 8. 4 percent very significant geopolitical and economic events, and for the time being, it looks like china is accommodating somewhat through the fixing. Off. simon, lets close to imagery, again, going out the world is demonstrations in a covert world on the streets of hong kong. My guest in the last hour said we are seeing from the extradition risks last year that this new risk for hong kong putting legislation through without going through the legislature is a new paradigm shift. Does that shift the narrative on the hong kong dollar peg . No, i simon simon dont think so. The hong kong dollar peg has survived some exceptionally severe crises and this is nowhere near as significant as that as of yet, so no, i think not. Having said that, yes, the process will probably continue. Today was calmer, is my understanding, particularly as we approach the june 4 anniversary. That will almost certainly pick up, and then of course, you have the september ledge co. Elections in hong kong and this is the first big electoral collapse since the collapse in the progovernment vote in november 2019, so things look worse, but to answer your question, i dont think any hong kong dollar peg. Simon, for bloomberg news, the latest on the new flows across the markets this morning. Coming up, tensions we escalate between beijing and washington. Chinas foreign minister said some u. S. Leaders are pushing relations close towards a new cold war. What does that mean . We will discuss that next with a head of Economic Analysis<\/a> right here on bloomberg. Manus welcome back. To the European Market<\/a> open. A. M. Euro stoxx 50 is up. 9 . Things are improving in the north of italy. That is the key. What will germany and france do in terms of stimulus . The frugal four of the e. U. Proposal. One off to your emergency fund. The narrative is shifting from the likes of austria and the likes of those Northern European<\/a> states in terms of what they are prepared to countenance for europe. Let me get you up to speed with your business flash this monday morning. The top corporate story hitting the news about today. Bayer looks to have made progress, having claimed its roundup weed killer causes cancer. It reached vulnerable verbal agreement. 10ayer bayer part ofs billion plan to end the costly in june. Tle, sources tell us that it is poised to replace its chief executive. Named as the carmakers new boss later this week. Aston martin has said this month fundsd to raise more and cut costs. Ryanairs warning on the collapse and air travel. The airline is left with more than fix hundred cap and crews in spain. That does not mean they are going to lose their jobs. Europes biggest Lowcost Airline<\/a> is looking at lower pay to reduceime work layoffs. They are looking at 40 of usual capacity. That was your Bloomberg Business<\/a> flash. Tensions are rising on the streets of hong kong. You have investors seeing profitable stocks in china. Capital,us of mobius spoke to bloombergs alix steel about the chinese opportunities. Theres no question that tensions are rising, and of course, these tensions have been going on for quite some time. In the beginning, with this trade war, and a number of other factors, so we cannot expect to let up in this kind of tension. Nevertheless, there are lots of stocks in china that can be purchased that are very profitable and growing despite all the problems we have seen, so i think we have to take it stock by stock rather than making a general picture of the chinese market. Understand how that plays into what the government is going to do in terms of stimulus. Mark number one, we are looking at stocks that are not going to be impacted by the trade war. That is number one. Number two, we are looking at rocks that have a global footprint. You have many of these chinese stocks alibaba is the obvious one. In addition to having this incredible market share in china , and then number three, we want stocks that have very, very strong balance sheets, and at this stage, we have to have companies that are able to gainre other companies and the market by doing so. Can you give me some names . All you wind up hearing about our Chinese Companies<\/a> and how much debt they have and how much help they will need from the government, so what are these names . Mark for the normal investor, names like alibaba would be the obvious one, but there are a number of others similar to that in that category. I cannot give you names because we may be buying. I do not want to be in that position. Generally speaking, any of these tencent,e alibaba, these are companies to be looked at. Alix fair enough, if some of those companies, the big ones, like alibaba, gets delisted from the nasdaq because of these trade tensions, does that affect how you think about them at all . Alix not really. Mark not really. Congress will pass the bill about Accounting Practices<\/a>. The Companies Listed<\/a> in new york have to follow u. S. Accounting. That will not be a problem for these companies because they are already doing international accounting. It will be very easy for them to come up with the right Accounting Practices<\/a> so i do not see that as a big problem. I think what you have got to see ofany problems in the face banks as regards to technology. That is an area to be very cautious. Even there, if you look at a company like tsmc, they will be able to survive any problems with the market in china simply because they are a Global Company<\/a> and supplying people many of thecluding u. S. Manufacturers. Alix are you worried we are going to see any supply chain shift that we were talking about accelerate because of the rhymers or does it not matter as much if you are looking at the right kind of companies that would be more immune to Something Like<\/a> that . Mark this is already taken place. You must remember it is not only the American Companies<\/a> that have a supply chain problem, but it is the Chinese Companies<\/a> as well. They have to now look afield out of their own area to find out where they can get their supplies, and they are not going to be sanctioned by the u. S. In one direction or another. The interesting thing that is happening is many chinese manufacturers are moving outside of china to manufacture in other countries so that they can get under the u. S. Trade area. Though thats another thing you have to look for, and we are looking at such companies, companies that are strong in china, moving globally, becoming more the Global Supply<\/a> chain company. Mark mobius is from capital partners, cofounder and partner. Coming up on the show, europes largest economy shrinks the most in more than a decade in the First Quarter<\/a> as germanys coronavirus lockdown hits activity. We discuss right here on bloomberg. Manus welcome back to the open. 7 19 in london. This is how the futures are looking at the moment. You have got a strong zone across the complex. Toer with a deal to sell up 80,000 of their lawsuits. You have this narrative around the world from italy, australia, to japan, about reopening, reengaging, allowing people to congregate. That changes the consumer narrative. That changes the overall l, u, maybeom towards a v. The ftse is closed today. It is a national holiday. Up 1. 8 . Lets talk about germany. Just had the data through. The economy shrank by over 2 . Could much expected. The final reading affecting the disruption from measures to control the spread of the coronavirus. The euro areas biggest economy held up. The lockdowns came a little bit later and they were less stringent, but the Second Quarter<\/a> is likely to record a bigger hit. Christopher is the head of macroEconomic Analysis<\/a> at saxo bank. Great to have you with us. The contraction was 2. 2 percent, the final reading of the First Quarter<\/a>. The question that comes to mind, we expect bloombergtv contraction of around 5 in germany, but we are looking at the stimulus of nearly 8 of gdp. Is the remedy big enough for the pain of contraction . Christopher good morning. I think what we need to expect in the coming months, especially the Second Quarter<\/a>, the pain will be deepened in the German Economy<\/a>. We expect the complexion than the Second Quarter<\/a> could be around 7 , which is already kind of huge compared with the overall crisis, and for the world, we expect the complexion to be around a percent, but at the end of the day, germany will cope with the situation much better than much of the other countries, especially italy. As a matter of fact, what we know is germany has massive stimulus. This could be another step in terms of stimulus, which is the good news. The management model in germany the deal with workers and employers, they are working all together. It is usually a good way to protect people. On the whole, i would be much more optimistic over the German Economy<\/a> than the other economies. That. 5he narrative trillion euro package, that is being debated about getting europe up, running, and recovering. The frugal four, as they are referred to, are talking now. Austria, denmark, the netherlands, and sweden. They are talking about a time limited emergency fund. The narrative has shifted from the austrians. You take part from that . Heart from that . Is that why we have seen a substantial response from markets this morning . Christopher everyone over the countries that are against the Franco German<\/a> proposal. As a matter of fact, this is bad news. We know it will take a lot of time before we manage to convert the Economic Situation<\/a>. Variety between france and germany on one side, and italy and spain. All three areide, benevolent, especially, but do not want to move forward. Would be one of the economies that will exist my biggest fear is that we will end up with lots of political bargaining in the coming weeks, which will have a negative impact on the Economic Situation<\/a>. It will take longer to recover when any of their country United Kingdom<\/a> yes . Variousook, you look at moments in history, whether it was europe raising rates into the crisis. I mean, splendid moments of misunderstanding the situation, from lehmans to a whole variety. In the world does not have time to really prevaricate endlessly about what needs to be done, does it . And europe certainly does not. Christopher completely. We know the situation on the ground. We know it will get worse before it gets at her. Politically, we need to tackle the Economic Situation<\/a> quite fast, meaning germany and france, but also the netherlands, needs to find an agreement and have a peaceful package that is big enough to tackle the situation. The problem is theres too much political noise, too much political discussion. We have to move fast in a period of crisis. Christopher, thank you very much. Yes, the graveyard of policy error is quite full. Christopher dembik, head of macro economics, analysis, over at saxo bank. Thank you very much for being with us this morning. Up next, we are going to talk about the china National Peoples<\/a> congress. The discussion. Was the stimulus enough . That is the question. Barclays has a note out this morning. We talked about it on the mliv team. Npcfiscal response from the was simply not enough, but of course, there are other moves afoot in regards to the political swagger by xi jinping over hong kong. What does it mean for global geopolitics . That is the question. There is no gdp number from the npc, and of course, that has many ramifications for those that benchmark lowball growth to the target set by china. Beijing forive to the political ramifications, the Economic Impact<\/a> of an npc that was quite explosive, to say the least. 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<\/a> 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. Manus 30 minutes away from the start of cash trading around your. The u. S. Is on vacation and the u. K. As well. Memorial day in the u. S. And may day in europe. The debate about the stimulus construction. Australia reopening. Gatherings, more than 20. Japan, the state of emergency being lifted. Shiftingbout narrative to normalcy whether it is in the u. S. Through to japan and australia. Is way over the sinou. S. Discombobulated and that is an overstatement. The ecb president will unveil the Central Banks<\/a> stability review. The last release warned about the side effects of negative rates but hopes of policy normalization have not disappeared. There is a longawaited recovery fund. It will lay out the proposed measures to support Member States<\/a> in the worst recession in living memory. Later in the day, the fed will debate the beige book giving a snapshot of the current conditions. And the age close speech closing the National Peoples<\/a> congress in beijing. Stimuluss are seeing measures being held in reserve. First day of the meeting dispensed with the explicit target of gdp growth but otherwise stuck to a path of moderate support to the economy. Let us get to beijing now. We have my colleague and cohost of Bloomberg Markets<\/a>, tom mackenzie. Good to see you as always. Where are we in the u. S. China relationship . Is it as bad as bad can be . Is it deteriorating . And at what speed . The issue is a multitude of areas the relationship is deteriorating particularly around the flashpoints of hong kong and taiwan. We have a response from the Chinese Ministry<\/a> to the broad report that the u. S. That the white house delivered to congress. A critical report. Broad strokes criticizing china on anything from the intellectual property to the china south sea. Ministryse foreign pushing back on a number of the issue saying it is Wishful Thinking<\/a> for the u. S. To think it can change china. Pushingaid the u. S. Was the two countries to a new cold war. He also brought up taiwan warning the u. S. Not to cross beijings red line. Upended diplomatic tradition by congratulating the winner of the election. There was also criticism over the Chinese Military<\/a> and its sales to taiwan. In terms of north korea as well, there was criticism from china on the way that the u. S. Had handled those negotiations and hong kong is the next front in terms of the deteriorating relationships between these two countries. Chinese officials over the weekend were trying to are sure that this new security law announced friday would not autonomy of the city and not undermine free speech and freeze press in and free press in that country. Something the prodemocracy protesters take issue with at the very least. Manus yes, it certainly is. Look, in terms of the other major story we are tracking in markets. The evolution in japan. Triedrmalcy that is being to be achieved. And then you look at brazil and it is a different narrative. Tom it is simply because of the brazil andections in the very unfortunate death toll. The way that the alsbo lsinaro government has mishandled see really the way the virus has unfolded in that country and the lack of restrictions in place. Railingo himself against some of those restrictions. The Trump Administration<\/a> is now putting travel restrictions in place to try to shore up whatever gains the u. S. Has made in trying to curtail this virus. And in the u. S. Coming your seeing a different picture in terms of blue states and red states. Those that voted for trump in 2016 and those that did not. And some of the motivating factors for donald trump to push for the opening of the economy as soon as possible. The data shows that in the red states, there are more job losses then infections versus the blue states but the dynamic is starting to change. The question is whether donald pricewill pay a political for rushing the reopening of the u. S. Economy. They have also put in restrictions to try to restrict travel between the u. S. And brazil. Tom, thank you very much. Tom mackenzie. Antichina protests return to the streets as tom was saying in hong kong. We spoke to the councilmember earlier. For thee vicechairman progress in hong kong. Take a listen. , we sawfirst of all those violent protests yesterday as you saw from the tv. Just an ordinary man was beaten up by a group of protesters. It was very cruel. This is very violent behavior. s daycond day is people opposed to this nationalistic law. One of the reasons is perhaps they do not understand the nature of this law. Actually i believe the majority of the hong kong people do not to worry or be concerned because if you are not committing crimes like terrorism or if you are not engaged in Something Like<\/a> sedition or engaging in these seditious acts come you need not worry. It is only those that engage in crimes they would be concerned. Areoreign investors concerned that with the new law, mucs the pullback of so depend so much independence. What about the argument that beijing is willing to trade hong kong station to consolidate control . Disagree with that point of view. First of all, i make that very clear. The enactment of the National Security<\/a> law, its purpose is to make sure that we have a safe environment in hong kong to protect National Security<\/a>. Violence w, the if it continues to carry on, we will lose our safe environment and knowing will be willing to invest in hong kong in the long run. , they have at macau done their National Security<\/a> legislation and Foreign Investors<\/a> continue to invest there. It is to make sure we have a safe environment. If people have concerns about this National Security<\/a> law, i , the details of the National Security<\/a> law remain to be seen but once we have the details, i am sure the Central Government<\/a> will come out and explain to everyone. Upthe way things are shaping and obviously we have to see how this plays out is that this will be introduced it is being snuck in, in other words. Now, would you be in favor of something being introduced in a similar way . If it was not this . Because a lot of people have expressed their concern that it is being implemented without consultation with the hong kong people as well. And that is a valid concern to have. What would you say to those people that beijing is railroading this through . Lden it is in article 18 of the basic law that a Central Government<\/a> does have the right to incorporate the national law into the basic law. And by way of promulgation come it would be implemented in hong kong. In accordancene with the basic law and i dont see anything wrong there. Legislativeong kong consult, holden chow spoke with bloomberg earlier. More on the in brussels. Down inon the bog brussels. China has become much more aggressive from on the international stage. We should not be calling this a trade war anymore. This is exactly the type of confrontational developments on both sides of the relationship you would expect in a cold war. Not only the american but ites have a problem is the Chinese Companies<\/a> as well. It captures the challenges of the relationship this year even as the two sides try to keep the phase one deal in intact. Both joe biden and President Trump<\/a> have advocated a relatively hawkish position towards china and china trade. The u. S. And the u. K. Will be taking the lead on this hong kong issue. What you hear is we have to draw a line and this time, the line has to be firm. Reacting to the escalation on the u. S. China trade tensions. These are the top corporate stories we are tracking. They are reviewing their management team. Replacing the chief executive with the head of dai mlers. A new boss could be named as early as this week. This comes asays they need to cut costs. A warning of a collapse in air travel. This does not mean they will all lose their jobs. Europes biggest Lowcost Airline<\/a> cutting pay and parttime workers are on the agenda. Operations. Restart alibaba is rejecting Revenue Growth<\/a> but it is still at 27. 5 . G sales Online Shopping<\/a> began a bounce back in march but the tepid outlook demonstrates the worlds secondlargest economy still has not shaken up the economy shaken off the impact of covid19. Let us stick with the corporate stories. Bailout haseuro been bogged down in discussions with brussels. Joining us now is the senior joining us. Dikt there were talks a week ago about the bailout. What is holding it up the shareholding, the construct . What is the pushback . Ikt probably a little bit of everything. The devil is in the details. It is in the hands of brussels and the European Commission<\/a> where the watchdog is taking a closer look at the deal. The German Government<\/a> could have this out with lufthansa. They are looking at how long might germany remain a shareholder . We arend people what talking about we are saying the German Government<\/a> is potentially taking as take of as much as 25 and that gives it a quite robust sway over the company. We are talking about what the rules would be in terms of m a Going Forward<\/a> . With lufthansa have to purchase the aircraft they have ordered . That is what is going on right now in brussels. It sounds like the German Government<\/a> and lufthansa have come to an agreement but the holdup is now in brussels. We are hoping in the next couple of days there is a Supervisory Board<\/a> meeting tomorrow by lufthansa and we hope they will be able to decide by them. Manus what are the contours of this rescue plan . What does it look like in terms of the German Government<\/a> . The size and construct of their participation . Benedikt the plan is that the German Government<\/a> takes a big stake in lufthansa. It is something that the government has said is without alternative. There was a point a couple of weeks ago where the lufthansa said we do not like this proposal and we dont want the government to take such a big stake. This was an airline privatized not that long ago. Some people at the company now,he ceo first and foremost witnessed the privatization of the company then and now turning back the clock is rather painful for him. So he tried to resist as long as he could the government taking a big stake but it has become increasingly clear as the crisis wears on that there is no alternative to the government orchestrating this bailout. The question really is how long might the government stay in their . The government does not want to be an exit investor. They want to have an exit strategy. That is what we are talking about. Whatever might happen, we will end up most likely at this point at least with the government as the single biggest shareholder and the big of the Biggest Airline<\/a> in europe. Pushbackere is the from the competitors . Michael oleary is not a direct competitor in terms of longhaul what he is vocal in the extreme in regards to this quasicheck given to the likes of lufthansa that would allow them to undercut those coming into the crisis perhaps in a healthier position. Is their marriage in that argument . Does it garners strength . Michael oleary is always vocal and he is spitting fire over this. Very unhappy to see these government al outs take place. We have seen them in france. He has said he will take legal action against the bailout of air france and says he wants to do something similar for lufthansa. His plight long before coronavirus appeared on the scene that you should never allow airlines. Nit he weak die, crass terms. He says they are not there to prop up artificially. Only a couple of airlines have the right to live and do their longhaul operations and the governments should not start meddling in these local markets. And prop up their National Carrier<\/a>s. Because he says it is quite simply unfair. Receive 9 lufthansa billion from their government and ryanair is forced to lay off workers and cut back. Just fighting not with one hand tied behind our backs but both hands and that is grossly unfair. If you look at it from the outside, you would think that he has a point but there is always a political dimension that says you cannot have your National Carrier<\/a> as it were go lost. This is a national emblem. This is what carries business into the world and brings business back into germany so there is a big political dimension behind saving these airlines. Manus absolutely, thank you so much. Bailouts inairline perspective. Our senior editor. A quick mention of bayer. We brought you the headlines that they had reached deals with a big proportion of their lawsuits. The stock going 4 higher. Bbayer said they will address all of the current cases including those currently held in abeyance. Other money is being set aside to address the lawsuits involving roundup. We will take into some of these market moves in just a moment. European equity futures called higher this morning. This is bloomberg. We the European Market<\/a> are just a few minutes away from the start of cash equity trading. Was moving higher by 4 on a journey to resolve its legal problems. It has reached a verbal agreement to settle a significant proportion of its u. S. Counter lawsuits. The stock is ramping higher. To our consumer reporter who covers the company. This would be quite a substantial progression, would it be . Absolutely it would be. It would be the biggest hurdle or cloud hanging over bayer for multiple years now this roundup litigation in the u. S. They lost three trials and we are reporting there are 125,000 outstanding suits. Until they can put this behind them, they cannot get on with their lives. And the vision they had in mind when they purchased monsanto. Manus ok, let us see if that endures on the back of that headline. Short and sweet. Coming up, it is the market open. Futures moving higher by 1 . It is all about relief from the lockdown versus geopolitical distress. This is bloomberg. W . W . Uhiono manus we are one minute away from the start of cash trading in equities. For memorial day and the u. K. Is closed for a bank holiday. The markets are dealing with a little bit of liquidity. The fx markets are worried about politics. Headlines. A new cold war. The u. S. Should give up its thinking on changing china according to the foreign minister from china after the violence on the streets of hong kong. Asian markets shrugged off the prospect of further escalation. Ith Mainland China<\/a> in the green, european futures. The market is up for a stronger trading day ahead. In other contexts, bloomberg has learned that bayer is in the process of selling a large proportion of its roundup lawsuits. Changing the narrative. Open to a deviation in the objection they had last year to your. Ting it is about the reopening narrative driving force in equities versus the fx narrative which is concerned about geopoliticals. Here we go with the gmm. Up she goes. Shifted theirr reasoning in terms of what they are prepared to do. Skeptical ofs expansion and debt neutralization but they are now talking about a time limit. That is the european context and narrative. The global narrative is about japan removing state of emergency. The north of italy having the cases since the end of march. Australia allowing museums and parks to reopen. The narrative will move from the elongated u to the v. That is when the narrative begins to change. But if you look at the fx market, it is worried about sinou. S. Relations which are quite literally in the trashcan at the moment over trade and hong kong. European markets are opening higher despite the tensions between the u. S. And china. The u. K. Is closed. One lady patiently waiting for us from Union Bancaire<\/a> privee is Eleanor Taylor<\/a> jolidon. Fx markets are worried but resoluteaders are a bunch, arent they . What do you reckon . Eleanor well, i think equity markets are hoping we are going to see an improvement in terms of the numbers on covid infections and deaths and they are expecting the economy to bounce back terry likely on the basis that we have not destroyed anything. There are a number of companies that can quickly hit the switch in order to carry on their activities because we have ed workers asrlough opposed to putting people out of work. There is also an expectation about whether people will be able to return to work. There is a lot of optimism that that is all going to work. And along the passage to recovery, we may have. That are slightly less positive and there may be pushback on that more optimistic scenario that the markets seem to be registering at the moment. Ghedbly whether the furlou workers will return to the same level of employment that they left and whether some of them may have decided in some countries that it is preferable to be unemployed than to return to their jobs. And whether there will be the same level of demand when we return after the lockdown period. There is also a big question mark at the moment. The rereading up the rerating of risk between china and the u. S. Many say this is bellicose rhetoric. Paradigme what the fx says. Like a test, dont they . Thequestion is is this chinese trying to control a deteriorating yuan . Is there a heightened geopolitical narrative . Eleanor well, i am not a Foreign Exchange<\/a> specialist i any stretch of the imagination. Yes, it is political rhetoric. Two gentlemen running the two countries involved who are very keen on strong rhetoric when they exchange opinions. It has to bes dead that realism usually comes back. You have a Large Manufacturing<\/a> base in china. Yes, certainly, there has been incidents. And there has been some manipulation or encouragement by the Chinese Authority<\/a> to give a message on the economy which would favor their political discourse. Whether that will be a lasting situation, whether that discussion continues to be considering that we are in an Election Year<\/a> in the u. S. Makes it more open for debate. In termss too violent of language, that could have an effect on the u. S. Economy and that may not be a situation that the u. S. Administration wishes to encourage. I think there is a lot of politics as opposed to economic rational discussion. Sometimes they come together. Manus let us extrapolate. I know you are not an fx specialist but an equities specialist. You have a certain thinking on tech. What you have is potentially, potentially u. S. Tech, china and the rest of the world tech, access to capital. That is one of the narratives we saw be put on the table last week. U. S. Tech would be left in a much more robust position. Theuote Colin Reinhardt<\/a> pandemic is the last nail in the coffin. Access toto consider capital and u. S. Policy in that regard . Eleanor i would say that tech is an extremely wide sector so it depends on what tech you are referring to. If there are going to be limitations in terms of capital and the ability of manufacturing happening in china for some western companies, i would expect a lot of that to be replaced by korean or japanese players which would be more detrimental to u. S. Tech then perhaps is the desire of some of the regulation beginning muted at the moment. Considering whether Chinese Companies<\/a> could is problematical but i would think it is also not taking into consideration the amount of capital which is available in other parts of the world and indeed in asia. Again, it seems to be strong effecge which may have ts which are not being soft at the moment sought at the moment by the administration in place. Manus eleanor, thank you so much. Eleanor Taylor Jolidon<\/a>, my guest host this morning will stay with us. Coming up, 9 billion euro bailout. This is bloomberg. Manus welcome back to European Market<\/a> open. We are 10 minutes into the trading session. About 0. 5 andp the rest of europe trading higher. Nearing a component some kind of a settlement on the roundup story. 0. 6 . Is up by there is a shifting narrative on the stimulus. Good news regarding the north of italy having the least number of covid cases since this all began. Business flash. Top of your corporate agenda. Bayer looks to have made progress in its claims with roundup. Sources say it is a verbal agreement with about 85,000 up claimants of the against the company. It is part of the 10 billion plan to end the battle. The company is likely to announce settlements in june. Is looking at its management team. Tobias could be named as the new boss as soon as this week. Toon martin says it may need raise more funds and cut costs. Europes biggest Lowcost Airline<\/a>. It is looking for a solution including parttime workers. It plans to restart operations of itsg july 1 with 40 usual capacity. And that is your business flash for this monday morning. Lufthansas 9 billion euro bailout has been bogged down in talks with brussels. Sources tell us the discussions are meant to ensure swift approval was the deal is finalized. Eleanor Taylor Jolidon<\/a> from Union Bancaire<\/a> privee is my guest host this morning. Bailout from four lufthansa and a shift from the frugal four in terms of a Stimulus Fund<\/a> from europe. Is classic view is america triumphing first and fastest and europe is the laggard with much dysfunction. Still holdld adage sway in this narrative of stimulus we are seeing come to are . R come to bea eleanor not so much. The traditional markets are having periods of strong Value Creation<\/a>. Than the u. S. Market or the swiss market. Since the great financial crisis, in fact what we have had is the fact that europe has significantly failed to create value. Or the companies in europe have failed to create value in the same way that Swiss Companies<\/a> and u. S. Companies continue to have Value Creation<\/a>. Is partly because of the makeup perhaps of the different markets. More cyclical content certainly in europe than perhaps what you would find in the u. S. And lower exposure to technology than you have in the u. S. Than European Market<\/a>s. As we see ourselves coming out of covid19, it is probably going to be the value creating companies which are more able to bounce back faster then some of the more Cyclical Companies<\/a> notably companies that are in need of slightly above average adp in order to perform. And that is what i would be a little bit concerned about regarding the European Market<\/a>s as we exited covid19. Manus and that is where you sve your skill toward kew. Tothere any hesitancy at all the dividend story when you talk about that Value Proposition<\/a> . Are you hesitant on some of the dividends or do they hold true . Naturallyf i did not invest in dividends for may come a dividend is useful as a signaling factor for a company to say look, thank you for investing with us. We want to thank you as longterm investors by giving you dividends. We have a decent cash flow of allowing us to do so. Dividends to not be very large but to be stable. I prefer to invest in a Company Creating<\/a> value rather than biting a company because of a high dividend yield. There are a number of companies that may be stretched when it comes to paying their dividend. They may not be able to generate additional cash. Skewve also seen a slight which is interesting as we emerge from covid19 with the way governments and regulators are talking to companies saying if you take help from us and the taxpayer, please tell us how you allocate your cash Going Forward<\/a>. And we have seen banks and indeed some Insurance Companies<\/a> in various countries being told to be thoughtful or even to cut their dividends. I dont invest behind dividends. When i talk about Value Creation<\/a> im talking about a return on , stability regardless of economic environment. You veryeanor, thank much. Inging up my pension and be careful of that dividend tracker. Eleanor Taylor Jolidon<\/a> will stay with me. Coming up, the money is coming. That is the message from rosengren. The company should be receiving main street loans in the next few weeks. This is bloomberg. Manus 20 minutes into the start of the european trading day. It is the European Market<\/a> open. I am manus cranny. Bayer is up 4 . Ryanair is one of the main movers in the european complex. Up 0. 6 . There you go. These are the names we are talking about. It is not like me to be ahead of the boards. There is always a first. Is ark warning that there scale of a talent for the likes of ryanair. Jobs in spain. Looking at a variety of reasons or opportunities to try to keep people parttime working and lower wages. It is all about the destruction of value in business. That was the message from Michael Oleary<\/a> on the news i was watching. Down. Ia there is a dispute and they may the right to operate according to some reports. The fed the boston fed president , rosengren said money will be sent out in two weeks. Up to 600 billion to small and mediumsized companies. The fed has come under increasing scrutiny over the slow launch of the Program Announced<\/a> in march. Eleanor Taylor Jolidon<\/a> is with Union Bancaire<\/a> privee, cohead of global equities. This is about main street getting another like on the nine stool. How important is this money in terms of activation on main street . Eleanor it is important. I have heard some people say one of the reasons the stock market continues to perform strongly despite what will be a fair amount of economic pain for main street is that they are different in terms of their base. I have a different view on that. Straight ise main often a cost precisely the main street is often a customer. That we do need to continue to support the main street in order to ensure the whole of the economy can recover. Are what the actual numbers , whether it is enough or not enough is somewhat open to debate and perhaps not even the subject which is important. The important subject is that we are seeing governments and Central Banks<\/a> wishing to continue to support the economy to do what it takes in order economy can pick up as we emerge from the lockdown. Theme ofu have your creating value already espoused. Swiss docs and north american stocks are your preference for creating value. Can you dissect that for me in the u. S. Narrative . Eleanor the clear beneficiary at the moment are the companies that will benefit from the covid19 situation which would perhaps lead us to the health care companies. , it is going to be the companies which can benefit from the changing way we run our lives which explains why some of the big tech giants are performing particularly well. Different ways of working. Microsoft and other Cloud Solutions<\/a> and amazon obviously with the clear polarization of the companies which are in very good health at the moment in the u. S. And the companies which sheetsestionable balance and a questionable outlook in terms of demand. Yes, there are shortterm advantages from covid19 and as we emerge, we will have a slightly different life which means again that we will be thinking about companies that are going to be of importance to the consumer or to their customers. Marketsghtly changing if i go to switzerland, im thinking of companies that could provide a better quality of work are likely and those to be benefiting from the situation as well. Clearly, the recipe in order to be a value creator in general is to be a company that works with growing market either geographically or in terms of the demand of those markets. Are these Companies Investing<\/a> properly in their products to make sure they have highvalue . That the product is relevant in todays world . Arelastly, the companys respectful of the reputation of their company and behaving in a way that the consumer is going to feel comfortable working with this company . Those are the types of companies we believe generate higher Value Creation<\/a> regardless of where they come from. Beautifullyor, stated. That is my guest this morning, Eleanor Taylor<\/a> jolidon. From Union Bancaire<\/a> privee. In switzerland. This is bloomberg. There are times when our need to connect really matters. To keep customers and employees in the know. To keep business moving. Comcast business is prepared for times like these. Powered by the nations largest gigspeed network. To help give you the speed, reliability, and security you need. Tools to manage your business from any device, anywhere. And a team of experts here for you 24 7. Weve always believed in the power of working together. Thats why, when every connection counts. You can count on us. Manus welcome back to the European Market<\/a> open. 30 minutes into the trading day. Technologyal estate, and construction all doing a little better. There is one global narrative this morning. This is the stoxx 600 this morning come up 0. 5 . It is about real estate. Technology begin led to higher. Those are some of the stocks driving the market higher this morning. Let us take a look at the individual sectors. On the downside is chemicals, telecoms. Along with those are the laggards of the session. Looking at those chemical sectors keep an eye on some of those movers because that is all around the reopening narrative. Let us get the bloomberg first word news for you this monday morning. In the u k, the Prime Minister<\/a> Boris Johnsons<\/a> most senior aide is facing growing criticism. Cummings allegedly broke the lockdown rules traveling more than 150 miles. His family was supposed to be self isolating but the government says the trip was to seek child care for his fouryearold. Calling the action sensible and defensible. The u. S. Is barring entry for most nonu. S. Citizens from brazil. Brazil has reported the second highest number of covid19 cases. Follows bars on individuals. Not goods. Israel, the Prime Minister<\/a>, trial begananyahus yesterday. He was read the charges. Leaders longestserving gave a defiant speech in the courthouse rejecting the allocations and accusing his opponents of trying to topple him. And German Companies<\/a> we will come back to the german story in just a moment. It is about the german consumer. I will take you about the gdp numbers that came in for the final rating. Personal consumption collapsing by 0. 3 . And a contraction in investment. Take on quite a bit of board their with regard to the german data. Let us bring you up to speed on the global picture. 345,000 deaths. Japan is set to lift its state of emergency. In the u. S. , there will be some travel limited from brazil. The country with the highest second highest number of cases. The anchor of Bloomberg Markets<\/a>, rishaad salamat. There seems to be an equity narrative focused on this good news story regarding the lifting of restrictions around the world. in germany, the cases are slightly higher. And in italy, there was political pressure. I really want to get to what has been going on here in hong kong because we have a situation where it is a new hardline approach. It has been taken under the cover of the government being more occupied with what is going on with the coronavirus than what is happening diplomatically. This hardline approach here in Hong Kong China<\/a> has made a onmatic move to crack down protesters in the city. There was a large rally with protesters after months. They gathered on sunday in the shopping area and police were waiting for them. And they went in hard using Water Cannons<\/a> and tear gas. Many arrests were made. Full idea ofad a what was enacted. It is being seen as the biggest erosion of hong kong independence. Tensions intened a tense already situation between washington and beijing. Manus how does it feel to live their . You have to live there . You have lived there are nine, nearly 10 years. Is this really that probable for you living there . Rishaad is it palpable . On the streets, nothing has changed but it is the prospect that is the problem. Hong kong has always been seen as a pawn in this worsening relationship between china and the u. S. We had the blame game over overer the coronavirus where the coronavirus started. There were questions of human rights. This new National Security<\/a> has the white is caught between a rock and the hard place. The administration has to balance harsh penalties being aimed at beijing and not impacting the vital interests of the United States<\/a> or the hong kong people. The debate in washington seems to be about a narrow approach which involves targeting businesses or individuals. Congress could enact the hong kong human rights and democracy act. Requiring the secretary of state to certify whether hong kong i. E. Nts special treatment its autonomy has been eroded to a certain extent that it is no longer a separate it is no longer separate from china. Going back to your question, that is something that people in hong kong do not see themselves as. They see themselves as something completely different from the rest of china and this is why people are taking to the streets again because they do not want in the same way as other parts of the marital as other parts of the mainland. Manus rishaad, my colleague and cohost of Bloomberg Markets<\/a> asia. Reached aituate of verbal agreement on a big share of the estimated 125,000 lawsuits over its roundup weedkiller. The stock is climbing this morning. We bring you the details. This is bloomberg. 8 40. It has just gone this is the state of play on the european stocks. Euro stoxxon the 600. A confirmation in a lot of the gdp numbers. If you dove into that rating number, you are seeing a contraction for the fourth order in a row. Paris is up by 0. 6 . The ftse up i 0. 5 . By 0. 5 . Se up narrative of reopening shifting the markets along with the potential of stimulus. One of the voices and institutions that has its finger on the pulse is bnp paribas. The bank says the pandemic will also permanently change the way it views its workforce with potential changes to real estate and travel. Head says that. Is affecting its return to office plants. Staffhave 95 of our working from home and the bank is open for business moving full speed serving clients. A return to the office is something we are planning on with a lot of consistency and focus. I would say you should expect it to be gradual with four phases. We willt hours first get our staff back and then we will assess how the pandemic will evolve. We will follow state guidelines while engaging with employees. Their feedback is important to us. I see three concerns coming from that. The first is around commuting. The second is around testing. There will be different kinds of testing. And the third one is social distancing ones back on the premises. Some of the other banks have been looking at things like setting up a temporary offer in the suburbs, for example, or only bringing capacity back to 20 or 25 . Can you give us some specifics about what you are looking at . Havech Business Model<\/a> will their own criteria in terms of timing. Paribas, ies to bnp dont expect for phase one more than 15 back on promises. Rush or no absolute urgency to get back on promises because the bank is really functioning very effectively. Had you told me to it half months ago that we would be operating successfully with 95 of the staff working from home, i think i would be hardpressed to believe you. Alix no kidding. Been hardpressed to say i was broadcasting from might homes though im with you on that. I wonder how that comes out on the other end, structurally. Are you looking at a smaller rental place or office space . There was a bombshell yesterday from facebook saying that would be their way forward. Your highlighting another is whatt point which kinds of structural changes we will be experiencing. Working from home is going to be a trend to this day and there workinglateral from home is going to be a trend to stay and there will be a collateral footprint. I do believe as well we will be reviewing business travel. We are getting used to doing this so digitally. I see the structural changes coming for my clients this time. There are changes for the supply chain for the economy. Time when the ployment rate is that, i know you are i head of the u. S. But you will have insight into the rest of the world as well. Are you looking at which region is poised to recover the fastest . Being a global bank, we have a view on asia and europe but specifically, i am u. S. And eurozone. Cross. Robably a a softer, slower recovery than what we would probably have hoped for initially. Economies see a contraction in the u. S. Around 6 . Eurozone, 8 . There you go, softer and slower recovery than anticipated. Looking at equity markets doing something completely different from bnp paribas. Been storming through the market this morning. They are starting to resolve their legal problems of reading to bloomberg sources. It has reached a verbal agreements to settle a significant proportion of their u. S. Lawsuits. 0. 4 . Is up is our consumer reporter tracking the story. The money. To how large can we expect these payouts to be . The on hows on good the case is for the individual plaintiffs. We are reporting for the first time that there are actually 125,000 plaintiffs in the u. S. Who have lawsuits against bayer regarding roundup. The company has publicly stated since april that there were 52,500. We are reporting another 75,000. These are cases that have not officially been filed but that are part of the resolution talks. Reportinge are also has a plan for about 10 billion to resolve all of this. 8 billion to give to current claimants and setting aside another 2 billion for people that might sue the company in the future that have already used the product. There is a finite amount of money to be dispersed to the 125,000 claimants. When i say that i mean when a final resolution is reached, we are saying a good number of those are in verbal agreements with the company but that is not everybody. Veryo you think reticent in litigious environments to say we are near the end of this particular roundups log up but can we say the end of this particular roundups saga but can we say that . Obvious paths no out of this short of winning a lot of court cases. The number of plaintiffs were piling up why the month and so the company succeeded in not going back to trial. That was the first big positive. They have engaged in aggressive negotiations with a smattering of plaintiff attorneys in the u. S. There are all sorts of parties involved. For bayer, you can imagine a game of whackamole going on. They have signaled in recent months progress being made but we are getting clarity on the clarity onut getting the matter has been difficult. We are shining more light on this today. It definitely feels like we are inching towards some sort of a place where bayer can move on with their lives. Sous tim, thank you much tracking the bayer story. Coming up, europes largest economy shrinks the most in more than a decade. In the First Quarter<\/a>, germanys lockdown hit activity. We discussed the data with our teamve with our mliv leader. This is bloomberg. Manus welcome back to the European Market<\/a> open. I am manus cranny. We are seven minutes away from the start of surveillance. Eye of catching the christine. Reopening versus movement in the fx market. What catches your draft . That is a good way of putting the issues. On the one hand, there is a lot focus hand Economic Activity<\/a> that is been so depressed in the last couple of months but we are getting all of these newold risks in the form of u. S. China tensions and the hong kong tensions as well playing into that. You have these factors setting off some of the hopes pinned on the reopening process. It is a question of who are the economies and nations that will be most exposed to that balance of risks here . Manus we are getting a little bit of a dove. This is interesting. We are going to get the data and expectations. People warning me that pmi will jump from the knees. Will notther soft data be something to wave of the banners about. Private consumption decimated by 3 in germany. On its own, it is probably helpful in terms of giving us another look at future sentiment. This is a forwardlooking indicator as opposed to the first order gdp from germany First Quarter<\/a> gdp that we saw from germany. It gives us a sense of where consumers and businesses lie in terms of their mindset at the moment and whether there is a sense of optimism for the future once we are past the lockdownreopening process and we are getting the economies restarted again is there optimism there lay in beyond the horizon . That will be an important component in getting the animal spirits going and perhaps giving us hope for some kind of a recovery towards the end of this year and early next year. It will be important in that sense. A gauge of what companies and individuals are looking forward to past billy long lockdown period. Manus we never got to the game of jenga in emerging markets. Everyone has to go to bloomberg. Com to see what that is about. Thank you to our mlive leader on europe. Shift from thee four frugal. The other is the global reopening from tokyo to australia to the issues around covid19 in northern italy. The subplot in the fx market is sinou. S. Relations. How that plays out we have to wait and see as it is memorial day in the u. S. Into cehic takes you surveillance right here on bloomberg. Nejra a new cold war. China warns the u. S. Of a further risk of relations. They start the week higher. Buyer settles. Bloomberg learns a deal on substantial sources. And Boris Johnson<\/a> faces criticism","publisher":{"@type":"Organization","name":"archive.org","logo":{"@type":"ImageObject","width":"800","height":"600","url":"\/\/ia801901.us.archive.org\/0\/items\/BLOOMBERG_20200525_060000_Bloomberg_Markets_European_Open\/BLOOMBERG_20200525_060000_Bloomberg_Markets_European_Open.thumbs\/BLOOMBERG_20200525_060000_Bloomberg_Markets_European_Open_000001.jpg"}},"autauthor":{"@type":"Organization"},"author":{"sameAs":"archive.org","name":"archive.org"}}],"coverageEndTime":"20240716T12:35:10+00:00"}