Surveillance. I am Francine Lacqua here in london. Looking some at oil, the oil recovery is at risk because of a resurgence of covid19. That is having not a direct impact for the moment. We did see a bit of downward pressure. The u. S. 10year yield pretty much unchanged. Eurodollar a good one to look at, because we saw a bit of data with the european economies. You can see the euro stoxx 600 actually trading sideways, but we did tr see the chinese trying to do their bed. Bit. Thelets get straight to bloomberg first word news in london with leighann gerrans. Hi, leighann. Leighann good morning, francine. The finance minister, Paschal Donohoe, won the ballot. Recoveryhe spanish minister. Action. Is having against fran in the long france in a longrunning feud over tech. Ballpark ofn the 500 million to 700 million in goods. The items targeted would include , andh wines, teas handbags. Poland, president andrzej duda says he will never allow compensation for jewish property lost in world war ii. The controversial topic is resurfacing days before the president ial runoff election. Duda has shifted further to the right as he faces tough competition from the warsaw mayor. And President Donald Trump has to give up his tax returns, but it is unlikely they will be in the public eye before the november election. The Supreme Court has rejected that he has complete immunity while in office. S blocked congressional action, returning the case to lower courts. Global news, 24 hours a day, on air and quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. I am leighann gerrans. This is bloomberg. Francine . Francine leighann, thank you so much. Now, the United States has reached another troubling milestone and the coronavirus pandemic, as a daily cases top 60,000 for the first time. It comes as the World Health Organization is keeping an open mind on whether airborne transmission plays a major role in the spread. Generalabout markets in globalederik ducrozet, strategist at pictet Wealth Management. Partly of course it is the resurgence of cases. What are they, you know, pricing and right now . They are i think what starting to price in is a transition to a new world, a world after. For instance, we might see a World Economy running permanently at the lower capacity rate. It is not so much that we see a thatd wave, it is the idea with this kind of risk and outbreaks everywhere, including we may neverates, see the possible future return to 100 of full capacity, whether it is in the manufacturing sector, the labor market. Look at the u. S. Data this week. Samell, it is still the picture of the labor market permanently hit by this crisis. This is, i think, the main reason it is priced into the markets and also why we see some consolidation this week. , whatne so, frederik does that mean for where you see values . The story i hear from a lot of cheap executives is that the pandemic is accelerating trends that were there before. Frederik that is absolutely true. There has been no change in leadership markets. It is dragging the markets higher. The idea, you remember, the last fed meeting, the Interest Rates remain low for a very long time, that the fed is probably not starting to address high valuation in markets. It is forcing the socalled growth rates to continue. This is not a sign that any massive move will happen in markets. Having said that, you talk about stimulus, some sectors, some companies will likely benefit more than others if we get the second wave, also a fiscal stimulus. In this case, we look at europe more than the u. S. , in our case. Francine so what you like in the u. S. Right now . For what, you know, what asset class do you like . Do you go to fixed income, because it feels safer, or do you also look at equities in certain cases . Both,. K we look at obviously we look, including fixed income. Angels, thefallen companies that were in relatively good shape, and this case, we look at the strongest ballast Balance Sheet before both thes, helped by government and the fed, which, in the case of the u. S. , is buying corporate bonds. That has been one idea. Otherwise, you look at longer duration and sometimes higher risk, because that is the new world in which we are. Yield, you extract have to take some risk. There is no freelance in this case. Francine what do you think of the markets overall . Frederik we have to be very cautious in using exposure overall. Having said that, there are two main changes over the last few weeks. First, the dollar has started to depreciate, and this is a trend we see continuing at a slow base, perhaps, that is something that helps emerging markets as an asset class overall. In chinese changes equities, so we have to adjust to this. We have a number of firms and strategies that look at the best companies, including tech, the highest quality stocks as well, because we think there is more, perhaps, in the mediumterm band the recent surge in interest that we have seen. I think that single from the government and the staterun media has been very clear about the idea that the bull market in equities will be important, well beyond the pandemic. So that is another topic we are looking at. Francine we also heard, you know, about an hour ago that china acted to call some of the federal to frenzy. That is what you are referring to, frederik, and it is now this 8day surge. Are you expecting more of, Government Intervention . Has the the press now Monetary Policy toolkit, right . Because this has been a very strong signal. It is an important communication. We see flaws from inside, which is not only about retaining investors, that could lead to higher volatility, perhaps even a risk of a bubble. It is not only about that. We have seen traditional investors fighting there, and shortterm risk, too high perhaps, and beyond that, the mediumterm signal has been supportive in general. Francine frederik, thank you so much, Frederik Ducrozet from pictet Wealth Management stays with us. We will talk about the ecb with frederik. Later, singapore decides. The citystate heads to the po lls. We are live from singapore later in the program. This is bloomberg. Gram. This is bloomberg. Francine economics, finance, politics. This is bloomberg surveillance. I am Francine Lacqua here in london. Lets get straight to the Bloomberg Business flash, heres leighann gerrans. Hi, leighann. Leighann hi, francine. Global banks are at risk of being caught between beijing and washington over hong kongs new security law. The legislation has taken many businesses by surprise, perhaps especially article 29. Or hostilesanctions activities against hong kong and china. Companies that break that rule will be fined or losing their license, potentially their business. Injuries reported by the contraception device essure. A safemarked as alternative, but the fda put restrictions on the device amid mounting complaints. Tesla skeptics are underscored by elon musk. Thebillion according to Research Firm equity partners. It is a candidate for a short wheree, when they are shortsellers are forced to close their position, driving the price even higher. And that is your Bloomberg Business flash. Francine . Francine thank you so much, leighann. Now lets focus on europe. Putting one of their own in charge of the finance ministers meeting. In a secret balance of 19, wonands Paschal Donohoe the vote. He defeated other candidates. Ll with us, Frederick RoseFrederik Ducrozet from pictet Wealth Management. What does that tell us about the difference between small and medium countries . Are we reading too much into it . Frederik well, i do not know. Maybe the finest ministers comments about these small countries carrying small weight backfired somewhat. There is a relatively small circle of finance minister, but it does suggest that the fight between the socalled small members and larger members of the euro area is, you know, being reflected at all levels of decisionmaking. Obviously, the new summit next week will be the opportunity for smaller countries, netherland in particular, which is not a small country, but smaller than germany and france, to express their opposition to a number of members. So it does suggest that the beginning, rather, the end of the battle. Francine we have had a number of interviews with highprofile guests, including the italian finance minister, and, you know, one of the commissioners from the eu, and they keep on saying actually that they are confident that this Recovery Plan will be voted for. But what bargaining tools today have with the more frugal countries, to make sure that it actually goes ahead . Frederik i am confident, too, eventually, that we will come to an agreement, because it is in everyones interest. And i am sure that those four Companies Feel like that as well. The problem is that the dutch crime minister dutch Prime Minister is facing reelection next spring. So that is europe. We have been there before. It also makes me more confident is there is room for compromise, because it is so complicated. You have to worry about grounds versus laws, about the , that also makes of the possibilities and room for compromise, so hopefully there will be some sort of compromise. There have been some talks, this week, before eventually in the second step on the principal for this recovery. Francine frederik, does it make a difference if the Recovery Plan is voted on now or at a later date . Frederik you see signs, encouraging comments on from all sides, saturday next week, we , which also puts the pressure back on the ecb to, perhaps, remain supportive of markets in the meantime, but if you see very hard lining positions from some of those countries on the amount of grounds, net transfers to the companies, sectors, and countries that need it, then that would be a huge disappointment. What are and, well, you expecting the ecb to do for the coming months . We know the great bloomberg story written by our reporters in frankfurt who says there will be a boost by december, because this recovery is so much more patchy than maybe we initially thought. Agree,k yes, i do september may be more than december, but lets not forget the ppp, the emergency program, looks more similar than the regular qe program, and the sense that it is also designed to address the lowinflation outlook. In that sense, we do not expect inflation to go back to 2 . I expect the ecb to do more. Shortterm, i think it needs to do a couple of things. First, avoid claiming victory, which is the impression you get from some of those comments over recent days, that the ppp has been successful. Yes, it is stabilizing markets. Yes, volatility in the bond market is coming down, but it is not the time to claim victory. Maybe next week we will sound a bit more dovish, cautious, highlighting the uncertainty around the outlook. Then there are banks, which is another technical topic, but i would expect the ecb to increase the multiplier now that you have beingiquidities distributed across countries, including italy, that will support the Banking Sector at large. Francine how much is the Banking Sector suffering from negative rates, even with extra tiering . Frederik without tiering, without everything, they Banking Sector is paying, if i may, on ing, the, but with tier ecb will reduce close to 0, actually paying back some money to the Banking Sector for a short period of time, but the equities at 3 trillion or more for the moment is going to stay with us. This is going to be a permanent income, ands net that is why it is important to address it not as business as usual, and that is why bacon continues to transmit the monetary stimulus to the real economy. Francine frederik, thank you so pictetrederik ducrozet, Wealth Management. President trump must turn over his tax returns to new york authorities, but it might be a very long time before they become public. Details, next. Retail investors have been growing as a more significant part of the market for a number of years, and, you know, selfdirected individual directors and a lot of the empowerment that has happened has been the trend for a while, but we certainly saw another piece that functions over the last few months, as you said, in 2019, retail, by our estimations , and because we have a big percentage of the retail volume, we have a pretty good sense of how much retail comprises of the market, was about 4 , but toward the end of last year, with the zero commission changes that started to get introduced to the market, we did see that start to increase to about 15 . And then if you fast forward to this year, with a lot of the covidrelated voluntary volatility, we have seen that more toward the 20 , and even on peak days, closer to 25 of the market. Francine that was joe mccain, he head of Execution Services at citadel securities, joe m ecane, head of Execution Services at citadel securities. President trump must comply with requests for information. That means it will likely stay out of the public eye until after the election. Joining us now is bloombergs Annmarie Hordern. Annmarie, break this decision for us. Francine, it was a split ruling, so this will not be expeditious. The first was a backing ford president trumps tax records. 200 years ago, a great jurist of our court established that no citizen, not even the president , is categorically above the common duty to produce evidence when called upon in a criminal proceeding. We reaffirm that prince of wales we reaffirm that principle today. This is a victory for the manhattan d. A. , so they can get their hands on president trumps tax returns, but that does not mean the public will see them. The Supreme Court blocked for now the house subpoenas, so in that prison, this could be a win for donald trump, and there was an opinion piece in the new york times, saying that he won because this, will shield his financial records before the election, but he blasted the courts, calling himself a victim of political persecution, in a number of tweets yesterday. Francine, the bottom line that came out of the Supreme Court yesterday is that the president of the United States is not above the law, nor does the president have absolute immunity. But when it comes to congress seeking his records, it is limited in its role over the president. Francine annmarie, thank you so much, Annmarie Hordern without ruling. Voters will not see any potentially embarrassing documents from his banks and accounting firms. A push to reopen businesses ahead of the coronavirus only has modest gains, we focus on latin america and the wider picture with Yacov Arnopolin of pimco. This is bloomberg. Francine economics, finance, politics. This is bloomberg surveillance. That get to first word news with leighann gerrans. Leighann the Coronavirus Crisis in the u. S. Is showing no signs of abating. Cases have top 60,000 for the first time daily cases have topped 60,000 for the first time. Australia is tightening travel and reviewing its quarantine rules after a recent spike of cases in melbourne. Singapore heads to the polls today as a ruling party since two extend its 65 year rule of the state. Are beingecautions taken, including temperature screening and the use of disposable gloves. Key issues include jobs and the economy, which are set to contract as much as 7 this year amid the Coronavirus Crisis. In poland, president andrzej duda says he will never allow compensation for jewett property lost in but were 2 four jewish property lost in world war ii. He has shifted further to the right as he faces tough competition from warsaw mayor rafal trzaskowski. And human rights abuses in the province of shenzhen, a major escalation in the white house spat with beijing. American officials have strongly chinased detention. Steven mnuchin says the u. S. Will use all his financial power to hold them to account. Global news 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more im 120 countries, leighann gerrans. This is bloomberg. Francine . Francine thank you so much, leighann. Brazils aggressive push to reopen businesses before controlling the rotavirus pandemic is so far yielding modest gains. Industrial output and rental, retail have recovered only part of their losses with restrictions on commerce. Brazil is one of several nations in latin america still near the peak of their outbreak. Joining us now is Yacov Arnopolin from pimco. Such a pleasure to speak to you. When you look at exactly what is going on in emerging markets, it is difficult to generalize. Broadly, do you worry that latin america is being hit really hard by the virus, that the lockdown was not stringent enough, so they dont feel a lot of pain so they will feel a lot of pain for longer . Yacov thanks for having me on. I think a relevant question, the reality is we are seeing starkly different outcomes in different countries. Which has notuay, had a lockdown, yet the rate of naturallyis very low, the economy effect is going to be more muted, less pronounced. Wee again we look at brazil, are concerned about the rate of infections, how long the crisis will be. How difficult is it to generalize right now, and if you cannot generalize actually, we never generalize but does it depend on how a leader is handling lockdown, how a leader is handling testing with covid19 . How have the metrics changed depending on h where you put the money . Yacov leadership is important. The crisis was handle