Im Francine Lacqua. We track the markets and policy. We look at statebystate, the difference between joe biden and donald trump to figure out what will happen overnight. What is clear is we are getting quite a lot of volatility. Volatility spurred on because there is concern there will be civil unrest if certain votes are not counted. There is concern out there in the press we could see civil unrest if the candidates of whoever does not win actually sees people go out in the streets. Stock climbing globally for a is americanbut it president ial election day so currency traders are taking the brunt off for the increased volatility. I spoke with one senior banker yesterday who said in terms of the trading floor, they will have pretty much full staff overnight to see what happens. When i asked about havens, it is difficult, he said, what would constitute a haven. A bit ofee the vix, elevation earlier on. The pound dollar. , for the moment we are looking at some of the currencies. Lets get the first word news with leighann gerrans. U. S. , as wellthe as nearly 100 million early pallets voters have already voted on election day. Some towns in New Hampshire have a tradition of owning at mid night. It was a big win for joe biden in the town, getting all five votes. Millfield to the south was a victory for President Trump with 16 of the 21 votes. Twitter says it will not let election candidates claim victory themselves. A winner to be cited. Sources say that two National News outlets state officialso, poste go viral and accounts with a lot of followers. Tweets that do not follow the guidelines. A shooting in vienna last night has killed three people and injured around 15. Police shot one of the Gunmen Police shot one of the gunmen. He was acting alone or with others. Despicable terror attack with the interior minister saying the shooter was a supporter of islamic state. Here in the u. K. , Prime MinisterBoris Johnson says there is no alternative to imposing a lockdown. He is revealing plans for whole rooto ouo be tested to boot t the disease. France has reported a record in daily cases. Global news 24 hours a day on air and on bloombergquint take, powered by more than 2700 journalists and analysts in more than 120 countries. Im leighann gerrans. This is bloomberg. Francine . Francine thank you so much. President trump democratic nominee joe biden conclude that lastminute blitz of campaigning in critical states. Almost 100 million americans have already cast their ballots. Biden currently leads naturally in the polls nationally in the polls. Later in the program, we will discuss the election means for investors but lets focus on americas relationship with its allies. Our first guest was British Ambassador to the u. S. For four advisore is now senior to chatham house. Is it aok at given that joe biden wins this. If you look at the dynamics of the electoral college, it could be a different outcome. Good morning. Thanks for having me on. Are we betting on a Biden Victory, i would say most people watching this closely in britain is a lot of people. Quite nervous about the actual results because although the National Poll gives joe biden a Pretty Healthy lead and has been constant for many months, the fact remains that in some of those battleground states it is quite tight. There are issues about whether those will be counted. There are issues potentially about voters being discouraged coming up on voting day. Said, if you look at the favorability ratings, you look at the polling, you look at the battleground states, it ought to be a Biden Victory that i dont know anybody in the United Kingdom watching closely that is taking that. We are all waiting to see what happens. Francine what are the swing states that you are looking for . And what happens if we dont have a clear outcome. Do you worry about civil unrest in the u. S. . Peter on your first question, we would love to have an early result. We will be watching carefully what happens in florida which will be as usual very close. E likely to give us a result in the early hours of tomorrow morning. Texas would be an extraordinary when. Probably not quick to happen. It has become a tossup. Arizona, which tends to give an early result. The are the really key states in the three midwest states that trump won somewhat unexcited, michigan, wisconsin and pennsylvania. Pennsylvania the most in porton what and no one really expects to get a result on that until later in the week, seems to me, but i am no expert on that. I think we are watching for the interesting ones, the ones that will give us an early result. I think that will be the most interesting. The second half of your question francine all right, let me ask you again, when you look at some of the things we should be worried about, civil unrest, does that change the dynamic between the u. K. And the u. S. Depending on who was at the white house . If there is a biden presidency, does it mean Boris Johnson will likely have to wait for a trade deal . Unrest, we share the same concerns that many people in america do. We worry to see people boarding up their shops. We worry about people taken the law into their own hands to supervise other peoples voting. We are a bit concerned and there has been some pretty inflammatory talk on the trump side. Lets hope that is misplaced and not a real threat. On the other question, on what does it mean to the united thatom, it is no secret Boris Johnson has felt a Certain Affinity with the donald trump. There are similarities. Their approach to politics, their approach to desire for applause and so on. I think they have got on extremely well. It is not the case the relationship between Vice President biden and Boris Johnson. I think in terms of trade and brexit and so on, yes, from the point of view of the current british government, they would be pleased to have a president another four years who says he loves brexit and who has said that he would like to give the United Kingdom a freetrade agreement. Im one of those that havent saying that a freetrade agreement between the u. K. And u. S. Will not change the price of brent. It will not make a difference to the trade. It will not make difference to gdp. Im more worried we might have the United Kingdom leaving the European Union with no deal which means our trade with other countries will be less advantageous. When you ambassador, look at the policy of joe biden on foreign policy, on how he would deal with climate change, what would actually change between the u. S. And china if he becomes president . That what would happen is a President Biden would put the United States back at the heart of the paris accords and the International Negotiations on climate change. President trump took america out of it and it had it had in effect until 2021. That can be changed. With china, i think one of the things that President Trump has done is to pull the cord on a lot of people saying china has had a good run. China has had a good terms of trade. We treated it as a developing country with all sorts of advantages in terms of how would could trade, but actually it is not a developing country. It is beginning to be the lunch of working people in many different countries. I think that has become a pretty bipartisan issue in europe, which believed strongly in freetrade. It has become an issue in america. My guess is that a President Biden would also take a pretty firm line with china but would probably not do so in the unilateral way and he wont be doing a policy of lets have lots of tariffs because that raises the prices for american consumers. I think he will want to work with allies on ways of engaging with china rather than doing it all by himself. When you look at some of the things that could change under joe bidens administration, is it energy, technology . Is it Something Else domestically . Policy, i suspect, will be a bit different. We had biden saying whatever trump says, they are not going to ban fracking. Need too said we transition away from fossil fuels, which i think is a responsible approach to take, although it does not go down well and some of those key battleground states which are strong on fossil fuels. Coal, oil and gas. I think that would be very welcome. More generally, my guess is that a President Biden will be saying to himself we are not going to just reset the calendar as it four years of donald trump never happened. We are going to have to address all of the issues that have left tens of millions of americans feeling abandoned, left behind, ignored, and what are we going to do to address those concerns . That is partly policy towards china, partly about stimulus, recovery and partly about how you address the covid issue. Beating up very hard on the president with his approach towards covid. America along with britain has been suffering pretty badly and governments have been slow with some measures they need to be taking. I think that will be a high priority. I thought that a President Biden would want to address the concerns of many of the people who voted for donald trump and who would want to vote for himself or whoever democrat it is next time around in this very difficult situation where so many middleclass incomes have been stagnant for the last decade or so and people feel pretty unhappy. Foreign policy, there are number of issues that will be a bit different. Russia will be closer. We talked about china. I think on the middle east, you will see President Biden will be different. He will be firmer on saudi arabia on human rights issue. He might want to stand up to some of the issues going on in turkey, a country he knows well but he has been worried about some of the things happening in terms of freedom of speech and human rights in turkey. In different parts of the world, i think there will be a different approach and many of them, he would be in line with President Trump. He will not be talked about taking america out of nato which will be a very reassuring change of emphasis for the europeans. Francine thank you so much for joining us today, former u. K. Ambassador to the u. S. Coming up, plenty more on the u. S. Election. It is voting day today. We will start have coverage throughout the day, and starting at midnight london time, we wrap it up. We will have the latest of all the Market Action as well. Coming up, investors, how are they positioned as we head into election day . We will focus on the outcomes, including the possibility of a disputed result means for investors. This is bloomberg. Francine almost 100 million hd so far. 100 million voted already, and more are going to vote today. They vote for biden is a vote to eradicate your oil industry. My message is simple. The power to change the country is in your hands. Tomorrow, we can put it into a president who fans the flames of hate all across this country. I am running against a very sleepy guy. We cannot let the sleepy guy fool us because he happens to be a corrupt politician. Time for donald trump to pack his bags and go home. This election comes down to a very simple choice. Do you want to be ruled by the corrupt and selfless political maniacs you are dealing with . Or do you want to be ruled by the American People . Focus on whats the election means for the markets. Wall street opens for its election day session with futures pointing to a positive start to trading. Markets probably position for a biden win, but investors are alert to the possibility polls can be wrong again or we could see disruption with contested results. Joining us is john norman, from j. P. Morgan. Perfect day to speak to you. First of all, what exactly are we looking at, because at the national level, joe biden is pretty far ahead of donald trump but if you look at the electrical map, electoral map, it could be pretty tight. John i think we are looking at election and that favors a democratic sweep but it is definitely not fully convincing and conclusive because the margins have been narrowing somewhat in the National Polls. Some of these senate races are not as wide in terms of favoring the democrat as people would like to see if they are biased towards a sweet. Theres always a wildcard risk over the next 48 hours. Francine what happens to markets . What exactly is the Market Pricing in right now . A blueiden presidency or wave with the democratic majority in the senate . John i think the markets are generally pricing in a sweep. That is one you can rationalize the fact that clients are long risking the market even if they are not long in size. There has been some outperformance over the past come of days in some of the market very exposed to sweeps like smallcap stocks. Theres at least a view that biden will be the president even if hes not backed by a democratic senate. That is one of the reasons why asian assets have been waiting for several weeks. Certainly, clients are invested for the idea of a biden win. They are little less completely invested in the idea of a democratic sweep, but that is the positions are suggesting right now. Francine how are you expecting the evening to pan out . Once the polls close in the u. S. I have been reading a number of press articles saying we could initially csee a red sweep because votes in person are counted more quickly and then we get the million votes that are leaning towards democrats. Is this a scenario markets should be aware of . John i think clients are generally aware of how fluid the aftermath of the election can be. We refer to this as election day, traditionally, a lot of folks have been referring to this as election week. I dont think people expect any finality in the next 24 hours. They recognize there are votesences in in person and postal votes. There is important states like pennsylvania that are not going to start counting the postal votes until election day. This could go on for 2, 3, maybe more days. That is one of the reasons why even if clients have a bias towards a certain outcome like a sweep, they realize there are uncertainties. They realize the shape of the race will evolve as the different states deliver their results. And they are more likely to position more fully only after something is made official. There is going to be followthrough. If you get a sweep outcome, clients have been keeping some exposure and reserve, feeling like a situation will oscillate over the next couple of days. Francine what happens if we dont actually have an election resolved this week, the next two weeks . Do markets just selloff because we are expecting social unrest or can you find havens in this kind of scenario . I dont think they selloff instinctively because there is no official result. It could be a number of days, and number of weeks before we get an official result. You can distinguish between an unofficial result in highly suggestive result. A result highly suggestive a suite emerges in the next couple of days, yet those results are not official because some votes are being challenged in particular states. I think as long as the margins are big enough in a range of swing states, i think the markets will trade with what the in official news is. Really, the more problematic scenario is where even the unofficial result are highly unclear whether or not this will be a Biden Victory versus a trump victory, and whether or not this will be a sweep versus a nonsweep. I think some of the traditional havens are the ones to go with. You want to be in some of these nondollar assets like the japanese yen. I think because the treasury market has sold off this month, you could see a move lower in treasury yields, a rally and treasuries which may be people had given up on as a haven trade. There are some options here. I favor the yen, i favor treasuries. Francine thank you so much. John normand from j. P. Morgan stays with us. We will look at some of the emerging market and focus on currencies. With the u. S. Election on the horizon, what do the results mean for European Assets . We discuss that next. This is bloomberg. Francine this is bloomberg surveillance. I am Francine Lacqua in london. It is u. S. Election day. The stock markets climbing for a second day along with u. S. Futures hours before the american president ial election. Currency traders bracing for a bit of volatility. Looking at treasuries slipping along with the gauge of the dollar. The measure of expected swings in chinas currency rising to the highest and more than nine years. Traders hedging against the volatile yuan after the u. S. Election. Im also looking at sterling jumping as the vote in the u. S. And its aftermath looms. Next, europes finance ministers discuss covid19. This is bloomberg. Francine economics, finance, politics. This is bloomberg surveillance. Im Francine Lacqua, here in london. Lets get to the bloomberg first word news with leighann gerrans. Leighann it is election day in the u. S. The latest polls show joe biden is leaving President Trump nationally as well as in key states. The Button Campaign says the surge in early voting will help the democrats, but trumps up a team argues that voters heading to the ballot box can easily wipe out the early advantage. Opec plus is inching closer to its january output hike. Russia is keeping its curve for the next three months. As oil markets we can. Planned to add almost 2 Million Barrels a day may not be such a good idea. Australias Central Banks cutting its key rate as yield curve targets and its bank lending facility. It is also announci