Those arrive in london today, and the pound appears to gain after jumping to a sixweek high. This is surveillance. Eldinusef gamal in dubai. Toew fiscal stimulus impact mitigate the impact of the coronavirus. Reflecting that degree of caution, a little bit lower at the moment for the s p 500. At the same time, european stocks are falling for a fourth straight day. What is happening in the states is the bund rally is likely to pick up momentum again as the focus shifts away from global input to some of the deteriorating domestic fundamentals. Think along the lines of the german confidence data we got, the yields near the sevenmonth lows we had. Benefiting from the larger dollar risk aversion. It is very much strengthening over the past month, and at the goldt, the philadelphia and silver index up about 1. 4 . Lets check in on the first word headlines for you and toss it out to leighann gerrans. Hi, leighann. Leighann good morning, yousef. Growing signs an agreement is insight. Negotiations will begin in london later today, with the aim of an accord by the middle of november. It comes less than a week after Prime MinisterBoris Johnson suspended the discussions, saying the eu was not willing to compromise. Bloomberg theell person who had died in the trial and brazil had not received the vaccine. The partner, oxford university, says it has no concerns about safety. In the u. S. , the vaccine problem warp speed says it expects trials for Johnson Johnson two restart as soon as this week. The u. S. Is adding media restrictions on another fixed publications and must meet requirements from those imposed consulates. And secretary of state mike pompeo says they do not want to put restrictions on what the outlet can publish. Instead, they want to make it clear to American People they are controlled by china. Andy International Monetary fund says asia faces a long road to recovery, even as china leads the rest of the world. It seems output in the asiapacific region likely under prepandemic trends, warning of significant Downside Risk with the most vulnerable being hit the hardest. Global news, 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. I am leighann gerrans. This is bloomberg. Yousef . Yousef thank you very much for that. Our top story, House Speaker nancy pelosi, her camp is saying that she and Steven Mnuchin have made more progress on a stimulus package, with the pair set to speak again today. Canl, Senate Republicans raise objections, adding to all the election turmoil, american intelligence officials are warning of foreign interference with the vote. Confirmed that some Voter Registration information has been obtained by iran, and, separately, by russia. This data can be used by foreign actors to attempt to communicate false information to registered voters. Yousef a bit of a wobble to the Global Financial markets. Lets get some immediate reaction. Joining us this morning is marija veitmane, senior multi as a strategist at state street. A probability of a contested outcome in these u. S. Elections. Marija yes, good morning, yousef, good morning, everyone. I think youre right, they as theed election highest risk for the markets. It has come down, and with respect, that is with the build up joe biden has in polls. So, yes, we will see that change. Longerterm, that is the big risk for investors in the shortterm term to get to the election. Over, we can get back to what drives markets in the longer term, Interest Rates, and that is where we really try focusour a concern our attention, so it is really getting through the next couple of weeks. Yousef i mean, i am looking wasugh what ms. Pelosi saying, the speaker the house of the united states, saying it will be a bill that is bigger, better, and retroactive. As far as you are concerned, it does not matter whether we get it before or after the election, but the market would beg to differ with that. Like a yeah, i think shorter volatility, absolutely, is going to be very, very high in the next couple of weeks, but if we think about kind of oflding a portfolio for kind mediumterm outlook, that is what we know right now is that we will have a bill. Expansionary politics, and that is what is , is aly kind of more better thing to focus on is how expansionary policy will be in the future, other than trying to kind of secondguess the shortterm volatility in the market. Yousef in terms of the recommendations you are making to clients at the moment, ricky sandler, a Hedge Fund Manager who needs no introduction, he is bringing the argument out again that it is time to rotate into value, and he points out that value stocks are trading at a steeper discount bensons the dotcom bubble. Hese names. To buy t would you subscribe to that . Marija i respectfully beg to differ. I think we talk about Growth Stocks every year, and every single year i was up but what about valuation, what about valuation, a year ago, two years ago, three years ago. Growth stocks have been rated and rerated. Is an even the milestone in terms of their valuation, but for us, there have been three key reasons for growth, one is a slow kind of worry, and even Earnings Growth. Overall Earnings Growth is fairly moderate, but with a lot more earnings, potentially, in those Growth Stocks that we are seeing in technology, in Consumer Discretionary sectors, health care sectors, and very little in financials, energy stocks. They expected Earnings Growth next year. The earnings level is expected to be below precovid level, so that is the concern. Secondly, Interest Rates are expected to stay very, very low for a long time. Points ofhas 10 basis recovery in treasury, rally stocks, but you do need to see a lot stronger recovery in bond yields, and that is very difficult to imagine right now. Yousef yeah. Marija in the third reason is kind of pandemicrelated that we saw. Yousef sure. Marija a very close link between growth stops and quality stocks. What we see with Growth Stocks is they have very strong balance sheets. More predictable Earnings Growth, and that is what investors really like. Yousef marija, if i could just interject here, because we are a little bit tight on time, and i want to get your view as well on u. S. Treasury yield, because we saw them move up to a fourmonth high, and even though that was a notable level, it was still a distinct range in a succinct range in the bigger picture. What will that be, the range, or is this doomed to fail, given the yield curve control that might be taking place . Marija i think you are absolutely right. We dont expect Interest Rates to go substantially higher from here. I think the big issue is that we know that the fed had told us that they are not going to be accessing for many, many years. That is the future curve pricing, that there is no rate hike for the next 5, 6 years, or quite aimal, so that is big cap on where i can go to, but more for the financials is what you need to see for yields going higher is very substantial economic recovery, to get inflation, to get growth, and that will naturally cause rates to go higher. That is maybe on the cards with a vaccine, but we have yet to see any kind of substantial development there. So it is still too early to talk about. We are not expecting higher rates, substantially higher rates. Yousef a lot of thoughts and insights there, marie out. Thank you for making the time. We appreciate it. That is marija veitmane, senior multiasset started at state street. They saysh bank seb, they are seeing limited on asset quality interview with the companys ceo is coming up, and plenty more. This is bloomberg. Yousef economics, finance, politics. This is bloomberg surveillance. I am yousef gamal eldin in dubai. Lets get to the corporate earnings season and see what is happening with the banking giant, scandinavias biggest. Is swedish bank seb weathering the coronavirus betterthanexpected. There are 550 million. The bank saying it has maintained its profit level despite the challenging environment. Joining us now is Johann Georgie Johan torgeby, the ceo and president at seb. Johan, what drove the resilience at the bank . Johan there was a healthy underlying performance with the income coming up 5 compared to last year. In our bank, we pride ourselves to have the best because control possible, so those are showing some kind in the recovery in a tricky situation. However, i need to point out below the credit loss line, we are still down significantly compared to last year, but it is not due to lack of activity or clients supporting the recovery, it is more that we do see and have to for see have to foresee, expected credit losses going up. Yousef you said you were impressed by the policy actions being taken by the continent to mitigate the impact of covid19. We are preparing for the winter. Infections are rising. Are you preparing for a bigger economic fallout as a result . We arei would not say preparing. We are doing some kind of scenario analysis, where this is a very possible outcome, so i think if we were to look at it as a game or something, we just played the first set, and we survived it. Now we do not know what the second one will bring. We are very wordy and therefore a little bit more cautious on the elevated level, and the opinions, they go in a different direction here around different banks, but we choose a more cautious approach. And i am still impressed by, particularly what has happened on the bankruptcy side in this part of the world, so the staggering statistic is that in september, we saw more than 30 lower bankruptcy among smes in this country, so i think that must be explained by Good Government support, otherwise we would have had more. Yousef has lending growth kept up with your expectations . What are some of your insights that you have been able to glean from them . Johan well, in a way, it has surpassed our expectations. That is that we have seen an increase in Corporate Lending and the demand for having liquid cash available for a rainy day. That was, however, mostly in april, march march, april, may, and we have seen a tailoring off of the coronarelated demand. This is the type of financing you put on the boards as a corporate but you do not necessarily draw on it, but you have it there for availability. We are at an Inflection Point right now where that demand is tailing off, and in the spirit of restarting the economy, working capital need, which is more of a real, Firm Requirement for capital is now coming in, but we are still in the early days. Yousef yep. Johan, you have reaffirmed a recent decision not to impose a dividend in 2020. What we are seeing with some of the other european lenders as there is more and more of a push on a call to reintroduce dividends. Is that likely to be part of the conversation for you for 2021 . Johan very much so, and just to be very clear, the board has confirmed the plan not to call it during the calendar year of 2022, to propose a dividend for 2019. Technically there is still a window between the first of january and the avm for 2020 with late in march. There is some flexibility. Generally speaking, we will definitely join forces with everyone who would like to reinstate dividends in a prudent, responsible way going forward. Looked at your cost to income ratio, johan, and clearly the bank has been able to make a lot of progress. What i am wondering is, to what extent do rising compliant charges threaten to hold you back from the kind of progress you have made, as you go into the new year . Very yeah, it is a relevant question, and to understand my answer, i think you just need to understand that for more than a decade, we used our cost control strategy in order to improve because income, provide a little bit of income growth, and keeping cost control. We have costs around 22 billion, 23 billion dollars, and within that scope, we have flexibility over the past years to invest quite significantly in the areas to fight Financial Crime, compliant systems, etc. We did miss our Cost Division by a couple hundred tolion, which we attributed mainly increased investments in compliance. We do reiterate our cost target for 2021, but we are investing quite significantly in order to make sure that capabilities are improved. Torgeby, wen appreciate your time, just running us through some of the ideas that are driving your thinking, of course the ceo of seb. Coming up on the program, facing the music in nashville. Trump and biden go head to head in their final debate tonight we will discuss that, next. This is bloomberg. Oomberg. Yousef facing the music in nashville. The president and joe biden go head to head in their second and final debate tonight youd after a chaotic first to become of the events should have more substance on policies. It should be focusing on american families, race in america, climate change, national hearing, national security. Joining us now is peter trubowitz, professor of International Relations at the London School of economics. How will they recalibrate their strategies to make sure that they iron out any weaknesses ahead of the countdown . Both trubowitz well, they faced challenges, it seems to me to do i think trump faces more mistakes this evening. He needs to close the gap in the polls with biden, and he is really running out of time. He has 12 days to election day. In the debate gives him the last moment, i would say, to convince the remaining undecided voters to break his way, and that means really convincing these voters that his performance in the first debate, that was widely too combativeng and on president ial, was a oneoff. It is worth remembering that president s have come back from losing the first debate before. Obama did, you know, against romney back in 2012. I think that is what trump needs to do tonight. You know, i think there are a number of things that he can do to try to turn things around, and, you know, i am happy to elaborate on those. Timef i mean, last we spoke, you said that white, noneducated voters could boost the incumbent president. How much of that is going to play a primary role for him in the coming hours . Prof. Trubowitz well, i think that those are the voters that he needs to reach, and theres probably, you know, even though the percentage of undecided voters is fairly small at this point, that some of those voters that we are talking about, these bluecollar, noncollege educated voters fit into that category. I think he needs to somehow reach out to them, and, you know, i mean, theres a lot of talk about he needs to be less combative, he needs to let biden make bidenbe make some kind of epic blunder. What he needs from these voters as some kind of a sweetener and sign off independent independence, and one thing he could do that would be interesting as if he tries to push a stimulus package. And whether Senate Majority leader Mitch Mcconnell is for it or against it, just kind of lay down that marker. Think he needs to that is a group of voters that they are trying to drive. He needs to reach out to them. Yousef yeah, peter, we will have to leave it there. We will see how the debate plays out. That is peter trubowitz, professor of International Relations at London School of economics. The debate is happening at 1 30 a. M. London time tomorrow morning. In the meantime, markets are trading lower amidst reports of potential meddling interference attempt from russia and iran. That is according to a top u. S. Intelligence official. About. 5 europe down already. Look out for u. S. 10year yields as well. Plenty more right around the corner. From dubai and the rest of the world, this is bloomberg. Yousef economics, politics, finance. Im yousef gamal eldin in dubai. Over the u. S. Election meddling claims, switzerland is the quasiliaison for u. S. Interests. Iranians are responding to claims from a u. S. Official that there were attempts to interfere with your selection, not only from iran but also from russia. Other stories, first word news with leighann gerrans. Leighann there seem to be further progress on a stimulus deal in washington. Senate republicans are continuing to raise objections about the size of the package. A spokesman for nancy pelosi says democrats in the white House Democrats and the white house are getting closer to legislation. Coronavirus hospitalizations have hit the highest point since late august. New york account double from early september. Now across the country, 37 states are reporting increased hospitalizations with according to Johns Hopkins university, the hardest hit region is the midwest. Nigerians are defying a curfew after Security Forces cracked down on protesters in africas most populous city of lagos. Hundreds of people have returned of hisstreets allegations of police brutality. They have chased cars and set tires on fire. Many have died amid the violence. 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. Yousef the ec . Tosef the u. K. And e. U. Are resume talks over a postbrexit j deal. David frost tweeted the negotiators will arrive in london today for discussions. Deal as showna gains since. Ian, where do the talks go from here . Do we have any particular guidance . We reckon theyve gotten about three weeks now to get a deal. That is certainly what the negotiating teams have been told. They are meeting in london today , and they are probably going to be either carrying on in london next week or back here in brussels. Basically what happened yesterday is that the e. U. Said fair enough,