Super markets spree Grocery Sales as british shoppers spend more to stock up amid the lockdown loreal looses ground after the french group scraps its guidance and warned that coronavirus will have a bigger impact that previously expected. Chinas factory activity has restarted and apparently rebounded in march after disruption was disrupted bit Virus Outbreak the pmi has risen to 52. Anything above 50 is expansion the number in february came in at a record low of 35. 7. Highly significant but much better than expected analysts had been forecasting a contraction. Well get to emily report we are seeing the Hong Kong Market close out a session on a tuesday with positive gains. With the form of the official pmi for march. The hang seng index closing up 1. 4 at 23,503. The latest pmi for march better than expected with a 17point jump to 52 back into expansionary territory coming off a record low in february coming out quick to say that they are cautioning that the readings do not dignal a stabilization but comes off a very low base. That is something that they are cautioning about the nonmanufacturing number is 52. 3 in february, 29. 6, you put these two together, a composite number of 53. Similar to that in the private sector, well get a reading tomorrow morning hong kong time. Februarys reading was 40. 3. So in contractionry territory. We are looking for a number of 45. 8 well see whether or not it does a big jump when we talk about manufacturing, we look to h hon hai. They are a big supplier to apple. The 2019 record card dropping to 3. 8 billion this is a thirdyear decline revenues were alltime record high of 177 billion the company said they had revolved the production shortage the company had to get everything back on line and back at capacity now diversifying outside of china investing 25 million into vietnam and india as these two will become Regional Manufacturing hubs for hon hai as well. Closing down under 70 per share. Back to you. Thank you, emily we are just hanging out here for numbers to come through from huawei it is fascinating what emily was saying there even though that pmi number looks terrific, it doesnt actually reflect underlying activity per se. Merely the fact that factories are beginning to retool and workers are going back to the factories. In that sense, it is a positive but doesnt tell you an awful lot about this stage in the chinese economy. On huawei, weve got the results now for huawei they say revenue through the middle east and africa grew 0. 0 for 2019 falling 13. 9 . A pretty big step back there in terms of cash flow, huawei says 2019 cash flow for operating activities was up. They came up 19 for the full year at 858 billion yuan. Lets take a listen to what he has to say an increase of over 13 huawei has pursued and maintained a capital structure the overall capital remains stable the the research is fundamental to huawei. Every year, we invest more than 10 in research and development. Rarchd d in 2019 was 131. 7 billion or 18. 9 u. S. Dollars. Accounting for 15. 3 of annual revenue. Over the past years, r d investment exceeded 600. We have more than 96 r d staff globally making up more than a total of head count. Huawei has been respecting the intellectual rights. That is the rotating chairman speaking of the results that they just delivered. Lets get to arjun, what is your takeaway from these results . Reporter you had revenue up and net profit came up about 9 billion to 5. 65 rise which contrasted more than 25 rise and 28 rise in 2017 significant slowdown on the profit side. I caught up with the rotating chairman there you heard he revealed that the results were in line with some of the projections but ultimately missed internal targets. The final target for the year was what huawei was projecting back in february 2019. However when the year was going good, they decided that those intern th internal projections would rise. In may, those had been thrown on the entity list that restricted the access including googles operating system that was a huge hit and essentially led to a 12 billion revenue shortfall for the year where most of that came from is the Consumer Division. Over 10 million came from the sho shortfall of the Consumer Division lets listen to what he had to say. Translator huaweis 2019 results were basically in line with our initial expectations but missed our initial targets we missed those set in 2019 which was 858 billion yuan in april, we realized our business were growing fast we adjusted and raised our target to 135 billion u. S. Dollars. As you know, huawei was put on the entity list. We didnt adjust afterwards. We didnt meet our revised targets which was 135 billion we were short by 12 billion this was the result of the u. S. Sanctions. What is encouraging, despite the challenge, we achieved pretty good results from our hard work and support from Business Partners the reason im talking about the Consumer Division, it has become the largest revenue that was the networking. Those remain pretty robust and huawei was doubling down on the china market nearly three out of five phones were sold out of china that showed you the focus it put on the Chinese Market after the blacklisting talking about the coronavirus here where you saw businesses shut, factories shut a lot of manufacturing for its network and equipment does happen here in china i spoke about the impact from the coronavirus. It is a bitterly to tell what the impact will be this year given it will spread to the rest of the world he feels short term, the company could deal with it you could see some significant fallout. Lets listen to what he has to say. Our production has fully recovered. If the coronavirus pandemic drags on and cant be contained globally we are bound to run into difficulties over the long run supplies across the world have daily briefs to us their ability to keep production going is crucial to huawei we have taken measures to help suppliers and disrupt productions. On the whole, youll find huawei pretty happy given how tough a year but 2020 is not going to be easy you have the cfo facing extradition on trial in canada and the u. S. Continuing to put them on the blacklist and the Trump Administration likely to ramp up pressure on the Chinese Technology giant throughout the rest of the year thank you for that from Southern China lets talk about the European Central bank here. Some comments coming through from visco he says the ecb is ready to raise the size of asset purchases, change the composition. Just a couple of lines to reinforce the sense that everything is on the stable when it comes to the ecb providing support. If you want to get involved in the conversation, follow us on twitter at street signs cnbc and get directly at geoff and to me at juliana wed love to hear about what you are doing at home. This black swan that it is being described as our next guest. 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Go to xfinity. Com moving to get started. Welcome back to street signs. European markets are extending gains this morning, quite a large session coming here. The cac up 2. 6 . In italy, the ftse mib up 3. 4. Some green shoots now with the number of new cases coming through. The country is on look down now through easter we could have some encouraging signals there. Ftse 100 up more than 2 a few sectors are in focus this morning. Every sector is trading higher lets look at the banks. Deutsche bank is trading higher. We are seeing gains for some of the uk banks barclays is up as well ecb has advised banks to withdraw their dividends and buybacks and they have a responsibility to support the economy throughout this crisis we are getting announcements from the number of lenders travel and leisure is a strong sector air france is up we have seen massive moves in these travel names airlines at the Top Performing very well. The accommodation part holding up not quite as well but green across the sector here autos in focus overnight, we had better than expected data on the manufacturing front. Official data for march that came in after that plummet we saw the month previous investors looking at the month with a bit of caution. The reopening is providing support. Autos being one of them. The likes of the fca, daimler and bmw all trading up shell says it will write down up to 800 million due to a sharp drop of oil prices the energy giant doesnt expect the Virus Outbreak to impact demand over q1 it added liquidity remaining strong and had access to 40 million of incredible funds. The swiss bank may reign in bonuses. They will decide on the 2020 dividend proposal despite calls for swiss authorities for lenders to suspend payouts commerzbank will suspend due to active around the coronavirus. The recommendation that lender suspend dividends until at least october. Fitch has cut its rating to triple b while putting deutsche bar bank on a negative outlook loreal has suspended its 2020 guidance. What can you tell us about what they have told the markets today. It is rare to see loreal trading towards the bottom of the stoxx 600. A negative sursurprise you are right the negative growth we have seen is luxury in asia pacific. That is two segments under pressure from the luxury front we have seen, carrying and revising their guidance and would be impacted 10 to 20 and asia pacific has been a great driver it was up 30 last year. They make about a third of their revenue there. Sales are very much impacted since the beginning of that year when i spoke to the ceo in february saying, with the previous epidemic, sars or mers. They had a quick rebound this has turned into a Global Pandemic more than half of the sales come with shops closed in the region, the impact could be wider. The revision coming from loreal. They have invested heavily in commerce they have a big boost in online sales and are helping to offset sales on the high streets where there was a slowdown from shoppers e commerce was at 50 . They are hoping this would offset a little bit the impact there. Expected to see a bit of a gradual recovery that would help to offset the shutdowns in europe and north america that has been one of the good drivers for loreal. They are hoping see this mitigated. This division from loreal sending the shares at the bottom of the cac this morning. Thank you lets refocus here on some of the oil prices that weve seen moving off the back of news of fresh talks, perhaps these oil prices bouncing off 18year lows on news that President Trump and putin held a call to discuss further talks over how to stabilize crude markets following the recent declines that alongside some of the news from shell about the lack of impact around First Quarter demand helping with the bounce here we are pleased to have with us gill prince. He believes the coronavirus is a black swan event that could impact markets for an extended period of time but also sees some opportunity here. He is the cio of edmund reasonablechild. How do you analyze when is the right time to reenter markets if you are currently not stocking a losing trade weve seen a black swan it has led to a panic, actually and from there, weve seen some relief rally, technical in nature where investors have the responsibility to reassess the holdings maybe well see the rebalancing and bargain hunting. There are, yes, some opportunities into the market for the brave investors that can see through the valley, i would say . When we talk about the opportunities in the market, the dividends are under conversation they are under pressure to withdraw we talk about banks, aerospace and others how do we welcome those. Melrose shares up. Talking that it is positive and warns off shares of could have vent breeches but on the other hand it draws investors in the first place. We have the strategy of looking for highyielding stocks today, we need to be more than ever, very selective on the companies we select. The dividend itself is not enough we need to look at the Balance Sheet and what makes a true quality company. Typically, you should focus on the companies that have recurrent cash flows and reserves that can navigate through that difficult environment. You talk about in your notes about how this crisis presents opportunities for companies to implement esg, the real topic this year. It has proven to be for companies that lose ground when it comes to esg and comes under fire the way they are handling the s part, the social aspect. Adidas and the ability to freeze rent payments. Do you see the ability to see tides shift and break out when they have an opportunity to really show their true colors . I think the current evens are quite positive in general. When you look at the performance of funds, it has been resilient. Those have led to select Quality Companies and to avoid some sectors that have been hit the hardest like airlines, energy and autos. So, yes. I believe that esg would want to have portfolios and should benefit from the situation when we select the esg companies, it is very difficult to avoid or to differentiate between two esg companies and probably the kind of situation will help us make that differentiation. Let me ask you about products weve seen etfs suspended because there isnt the underlying liquidity justifying to continue to trade the product. A lot seem to be having some issues around pricing. For those who thought they were quite racy and sexy before this crisis, youve got all these three times short oil products and so on. Where do you think we go in terms of these products once we come through the other end will they remain popular or do we see people trying to hunt out a good Old Fashioned fund manager. Definitely, there is place that will have a preference for active managers. That kind of situation, they could be more reactive and should see the opportunities provided they are of true benchmarks for etfs, it is based on the index. Actually, there is a lot of sophisticated etfs they carry more weight than we think. There is still a place for etf after all of that for sure simple etfs or the liquid underlying, there is still place or demand for that that is still perfectly right, i would think. Thank you for that. Coming up, the clash over corona bonds continue. Sheaing shared debt instruments would take too long to create. Good morning you are watching street signs. These are your headlines. Lets get into the markets. We have a big bump here. The u. S. Futures extending gains. Steep losses in march amid the Coronavirus Crisis putting europe on track for the worst quarterly declines in 18 years oil and gas stocks lead. U. S. And russia agreed to talks to bring calm to crude markets and discuss saudi arabias increase to production huawei as trade and Technology Tensions weigh on the Technology Giant telling cnbc the Virus Outbreak is a major threat to its outlook. Translator the coronavirus drags on and cannot be contained globally and some suppliers stop production, we are bound to run into difficulties over the long run. Loreal loses ground after the group warns the coronavirus will have a bigger impact than previously expected. Lets kick off this hour. This is the february retail sales data down 46. 7 volume from a year earlier. Retail sales by value down 44 from a year earlier. The government in hong kong says the year on year fall widened sharply in february and was the steepest for a single month on record the numbers were already weak as a result of the ongoing protests but a lot of people have been in quarantine from the end of chinese new year, the end of january. You wont see a great deal of improvement coming from march, even though we are seeing people back on the streets and some of the dim sum restaurants back open so that is a blessing. It is even if it is at half capacity green across the board there. The dax leading the way again. The key outperformer yesterday when the stoxx 600 grew 1. 6 higher we are seeing those gains extended that positive movement continuing with every sector trading in the green in europe travel and leisure, the key outperformer this morning. Significant bounceback in airlines oil and gas as well. That sector up 4. 4 . The u. S. Saw strong gains in all indices. We are looking at decent numbers with the dow with a 180point rise at the open if those numbers hold like weve seen, if those levels hold, well see positive mow men momentum putting that on the gain for the dow and the s p 500 as well. The latest statistics, the cases has risen to 782,000, the death toll has climbed to more than 37,000. The u. S. Has suffered the deadliest day of the pandemic yet with deaths increasing to over 3,000 cases in spain have surpassed those in china the Spanish Government has tightened restrictions to stem the spread china also saw a rise in new infections reversing four Straight Days of declines. France has recorded the highest death toll as patients have flown to germany 418 patients died at the hospital bringing the total number of lives lost to more than 3,000 it is believed that number will peak later this week italy has extended the Strict Lockdown measures to a least easter any easing of the lockdown would happen gradually arguing that the country is at the most acute out break they suffered 840 deaths in the last 24 hours but reported a decline in the number