France and germany and others remove travel receptions spur tourismu. To and britains nonessential shops opened today as well. Stocks fall on fears of a wave of rhinovirus infection. Over 20 u. S. States see a pickup. Tokyo sees the most cases in over five weeks. Beijing reports another outbreak. Plus, bloomberg learns of an internal plot at nissan to take months beforeown his arrest in japan. The information comes to light and is due to face a trial in tokyo. Just under one hour away from the start of cash equity trading. Lets take a look at how far down futures have fallen, right now looking at 2. 5 drop on the stoxx 50. The benchmark index. Futures down a little bit more than that. Teachersok at u. S. As well. S p 500 emini contracts approaching 3 losses. Nasdaq futures off. What does the gmm look like . Anna ill get to the gmm in just a moment. Pricel giant revising its assumptions and expecting to take a charge in the second quarter. They see a noncash impairment and the write offs. They are assessing the carrying value of the groups. That reassessment from charges has arisen. Charges estimated to be in the range of 13 to 17. 5 billion. Ranks inee how that terms of interest levels for investors in bp specifically. They are reviewing their intent to develop some of the exploration prospects. As i mentioned the redhead mind just crossing the bloomberg. Back to the gmm because you rightly on the futures and what we are seeing in terms of the european equities market. Low expectations. U. S. Futures also really weak, as you mentioned. Down by more than 3 on the dow. Weakness coming through strongly in the Asian Session though some of these markets down considerably. Japanese market down by 3. 5 . A south korean market down by more than 3 . A real risk off move. Money going into the dollar as a result. Classic riskoff pivot. Doinge the u. S. 30 year particularly nicely this morning in a phase where the bloomberg dollar index shows a move to the upside. It is interesting to ask where the second wave conversation goes next because at a time there we saw the first wave hitting developed markets, there was a big link between expectations of a real decline in Economic Activity and the extent to which that looks the same this time or looks frank, can that link be broken by testing and chasing technology . Can it be broken by a nuanced, targeted approach from policymakers and law down measures not having to be the big sledgehammer we saw the first time around . That will be key as we move through the summer. Matt very interesting stuff. Adjusting to see the dollar index down, dollar index up today in the face of so many new calls, fresh calls for dollar weakness as the safe haven trade unwinds or that was and remains the case for people like Stephen Roach. Lets get to the bloomberg first word news. These are todays top news stories. China is racing to get control of a coronavirus outbreak in beijing after the biggest rise in cases since mid april. The citys largest fruit and Vegetable Market is surrounding housing and has been shut down. It is the largest test of the countrys strategy to contain the virus since the pathogen first emerged in wuhan. Things are looking up for the u. S. Economy according to the white house economic director, larry kudlow he told thes state of the union that growth in the u. S. Is recovering and there is a very good chance of a vshaped recovery. President Donald Trumps chief Economic Advisor rejected a more cautious outlook by Jerome Powell, saying the Central Banks chief comments had been really morose. Shop with confidence. That is the message from Boris Johnson. Review of aing a two meters social distancing role as he tries to encourage consumers to grow and by nonessential to go and buy. They fear keeping the distance requirement will hurt businesses. Atlanta has become the new focus of the nationwide black lives matter protest. That is after 27yearold black man was fatally shot by two White Police Officers while fleeing during arrest late friday. The citys police chief resigned hours after the killing and the officer was fired. Three dozen people were arrested after protesters set fire to the wendys restaurant where the shooting took place. 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. Lets talk about these markets. Risk assets start week on a new note as european and u. S. Stock futures fall on the latest plandemic news and fall increasingly. The dollar climbed against major peers as investors gauge the second wave of coronavirus infections. Lets get to dani burger. 20 states in the u. S. , tokyo, beijing, tocsin second waves. That is flicking the market to quite a large degree this morning. Dani it absolutely is. Everybody has a plan until they get punched in mouse. In the mouse. We looked at what equities were doing. Theyrisk assets, how can continue to rally from here when we look at the ground . The picture, the economic picture . When we start to get the narrative shift in the markets, and this is what it is about, the narratives starting to change in markets. That is when you can get this in differing of opinion and you can get the frost taken off the top. Its not really clear whether this will be a sustained downturn or if it is just fast money getting washed out at this point. One of the things we can look at is how thin a lot of the liquidity has been. Volumes are not exactly robust so far this morning and on that big thursday, we really saw the selling pressure was intenses onto the down side. A sickly buyers had disappeared from the markets, so that lack of liquidity really drives these losses. The day that perhaps does not necessarily warrant a huge downturn turns into one because there is really no one on the other side of the bed. When you have these factors starting to stack up, you can see the effect snowball. A lot of traders i have been speaking to this morning told me that what is really missing here perhaps is sound fiscal policy that in 2008 to 2009 selloff, the big 5 down days really reflected a mismatch between what was going on in the economy and the response from different fiscal players. Perhaps they are looking at states starting to reopen, lack of support may be for smaller players. And at the same time, the virus. Ount starting to go up looking at the weekend trading figures, it was down the entirety of the weekend. Once we get markets open, you get this to be, really negative attitude. As i say, because theres not a ton of conviction out there, because the liquidity is not that strong, it has yet to be seen whether this is a sustained downturn. Manus matt to that point, we see some interesting typical safe haven plays. Down gold, for example, down right now, looking at bitcoin right now, down to 9000, just over 9,000 right now, so it is not every safe haven that is getting. As i am sure you know and i am sure stephen knows as well, the aote originally comes from former heavyweight champ, mike tyson. Everyone has a plan until they get punched in the mouth. Letse on to continue with our market coverage here. The second wave versus reopening. Wass that balance that dani talking about. The downside is winning the battle for the key market narrative. We will discuss next with the head of Investment Research. This is bloomberg. Anna welcome back to the year. Market open. 45 minutes to go until the start of the European Equity trading day. European futures point down by more than 2 . U. S. Futures weaker on dow futures paid with that in mind, lets talk about where we are. Stocks turning lower after fridays reprieve. U. S. Futures under pressure. Of thef a second wave coronavirus seemed to be overwriting positivity that the european economies are beginning to reopen. In the u. K. , nonessential retail shops are opening their doors. That is basically that is not food or pharmacy related. Crossborder travel is being actively encouraged to germany, france, and others ahead of the peak summer season. Joining us for more is the bank of americas head of Investment Research his work focuses research. His work focuses on the trends of the new consumer to the changing global order. Lets talk about some of those trends. Broad picture. Good morning to you. I wonder how much your themes stand up to a second wave. Your investment seems that you are working on or dealing with at the moment. Are they robust enough to deal with a second wave . First of all, definitely yes. We are talking about the next couple of years, two years to three years, and we think that coronavirus is going to shape a lot of the trends. The megatrends will impact our life in the long term. Second wave is part of it. This is not going away. It is going to reshape everything. And we are going to have to live with coronavirus sidebyside with us. The economy is going to have to adjust to that. Society is going to have to adjust to that. People will have to adjust to that. Maybe even a third wave. Matt what are the themes then that you want to bet on, that you want to invest in, knowing or planning for a second or even a third wave to come . Haim first of all, we think the coronavirus is going to shape up and change a lot of the things. It will accelerate megatrends we have been talking about for a long time. First and foremost, we already started being geopolitical pressures when the two superpowers, china and the united ways, are taking advantage of the coronavirus to increase influence and to reshape lowball economies and the influence in Different Countries had as a result of that, we are going to see a restoring of activity. That is a trend we have been talking about for a long time. Where we start to see that, that is going to atac war. Morell see more and investment in technology. We always start to see that come down to infrastructure. Down to broadband, semiconductors. Will gong around that faster. We are going to see a complete reassessment of the health care market. Health care from here on will be a new economic trend, new economic power, geopolitical power, so that is something that will be completely reassessed and we will see a new consumer. We are going to be digitalized. We will work more from home. We are going to focus more about sustainability. All of that will reshape the new consumer. Anna absolutely. Plenty of trends to be watching for. You talk about Big Government crafting a new social contract in developed markets and you rely on some of the market analyst of your community at bank of america to do this for one third of your analysts see a drop in some shareholder rights, a rise of the stakeholder economy instead. For better or worse, how should shareholders navigate that . Haim shareholders need to understand they have a new stakeholder in the government. It is not necessarily whether they will buy direct stakes in companies from here onward. They will be new stake holders whether it is regulation, intervention, new compliance rules, new governments rules. You said that right. One third believe the shareholders rights are going to change for the coronavirus and if you add to permanent give or take 60 of americans believe shareholder rights will change post coronavirus. That is a strong statement and each and every industry, does not matter which sector, country, or space, need to understand that from here onward, it is unique stakeholder. Matt we are going to keep you with us. We have more to speak with haim israel, the head of Investment Research at bank of america. They with us for that. Coming up, from the emergence of the Gen Z Consumer to our new focus on i. T. Spending, we will toback with haim israel shape a post coronavirus world. This is bloomberg. The conditioning to buy the dip is very deeply embedded. We could see a downtrend of 15 at some point. Yesterday, while the market was due for a pullback, i think the tone of that was also too harsh. Where equities bottomed out and how fast and explosive they rebounded, they currently got overextended and a lot of that has to do with the feds money policy. As the market was selling off, it seemed like everything was going to rally because the fed was behind you. The fed is behind you but they are not going to rescue everybody. Not everybody is going to make it so you have to be a lot more careful. Even with all the policy response, it will take a while to get back to the longterm Growth Potential of the u. S. Economy. It is going to be a checkmark. It is not going to be a sharp v. We are concerned the market has priced in a really positive bounceback and Economic Growth that may not materialize. The those were some of guests on Bloomberg Television reacting to the stock rout. While european and u. S. Stocks rose on friday, we can see futures are back down pretty sharply today. Looking at almost 3 losses on European EquityIndex Futures and if you look at u. S. Equity Index Futures, you get to the 3 level. On the Dow Jones Industrial average emini contracts. So that is what we are working with right now. Lets get back to our guests. Haim israel is with us from bank of america. I have a key question to ask you about on this point. Anna was pointing out that the bloomberg dollar index was rising again today and i saw a number of calls, fresh calls from morgan family, repeated opinion piece from Stephen Roach on the bloomberg saying they expect the dollar to weaken as the safe haven trade unwinds. What do you think about this incredibly important variable . Going tothink there is be globalization, polymerization between Different Countries, and we are going to be reshoring of activities, and that is going to string than economies, economies which are going to be more influence by automation that could bring back a lot of activities. That also brings back the United States and other countries as well so that will have a direct impact on the economy and that money flows. About , and you talk talking about the effects of this longerterm, you talk about the effects. Perhaps we are going to end up with two different text fears. Is that something you can invest natureor is this by its limiting your Investment Opportunities in tech . Haim what we are seeing right now is the two superpowers. In order to fight for geopolitical influence, you do that behind a computer. The key weapon is going to be technology. It will be investment in new infrastructure. It is going to be a processing power, data, and so on. There are going to be infrastructure, everything around 5g and so on. We also are big levers in data. Storage, cloud computing, and so on. We think part of it is going to come from processing power. So those are key centers we think that will benefit. We will see acceleration in investment in technology partially being driven by governments because this is going to be a key interest from here onward. Matt do you have a regional take at all . You mentioned the superpowers. We see the u. S. Increasingly isolating itself in terms of global trade. Last week, i thought it was interesting that Angela Merkel in berlin was reaching out to xi jinping and li keqiang in terms of trade, trying to in a bridges where the u. S. Has been burning them to some extent. Haim i think that also the United States understands that the road for a for a Global Economic power, growth for investment in other countries, we have seen the u. S. Equivalent to the chinese the one belt, one road project of china. It is still in an early stage, not the same magnitude as the united they. We are seeing a change in terms of Global Infrastructure spending. We have seen china and the United States are way above other countries in terms of r d expenditures, in terms of infrastructure, in terms of patterns we are seeing. They are way ahead of japan, well ahead of europe. And we continue we will continue to see those continue to gather more and more investments going forward. We do understand that the Global Infrastructure is being spent right by china. It will have a lot of advantage going forward. Accelerating investment a lot. Europe has been a rock and a hard place in terms of infrastructure. They have u. S. And chinese infrastructure, which they are relying on for r d expenditures. Caretrends are in health and a few other sectors, but when it comes to technology, u. S. And china are by far the latest. Anna i wanted to ask you about health care and how investible this is. You talk about it as a resource for governments. I wonder if that is something that lives longer than our concerns around a coronavirus vaccine. Definitely. First of all, and understanding that globally, we spend roughly 10 of global gdp on health care , give or take 8 trillion dollars worldwide, but it is completely inefficient. Today, we are throwing away give or take between 20 to 40 of this number just because of inefficiencies. Are printinghich money and increasing deficits cannot increase this investment but from the other side, they do understand that the road for Global Recovery and their influence goes through a Strong Health care system. Look at countries which are managing to open up their economy because of a Strong Health care system. We do believe the solution will be found out by health tech, infusion of technology in health care, and that will be the way going forward. Matt thank you so much for your time this morning. Appreciate your insight. Fascinating stuff from haim israel, head of Investment Research at bank of america. Coming up next, we will talk about easyjet and travel. This is bloomberg. You doing okay . Yeah. This moving thing never gets any easier. Well, xfinity makes moving super easy. I can transfer my internet and tv