Under formal investigation for the allegedly peddling. Ofre was 15 hours questioning in paris. We can go to the french capital conna. Ak to carolyine connan. Good morning, anna. In 2012his immunity when he lost that election against francois hollande. He is not been charged yet. Just being placed under formal investigation. He is accused of writing a highranking judge by asking confidential information in as government advisor in month ago monaco. There was another investigation into illegal financing of his political campaign. , it is being said that he knew that it was going to be tough. Nicolas sarkozy has denied any wrongdoing. Some of the political allies are accusing the leftwing party. To prevent his comeback. With widelyozy respected to make his comeback as soon as this fall to regain their leadership of the right wing party that has been damaged by political infighting and in the longterm, to possibly run against president hollande in the next president ial election. Thank you. Caroline connan reporting from paris. Lets take a look at the markets. S p foundow and the new records in yesterdays trade. Signaling perhaps a bullish start. Can that rally be sustained . Manus cranny is here. Good morning. Whether itys worry her else all of the voices heralds all of the voices. It is an old rally. It is five years old. Small caps rally and transport rally. They all took flight. I like what mohammed said in his recent piece. Re ready for liftoff . Are we ready for liftoff. I think we should focus on this. Financial booms sprinkle fairy dust of delusional riches. Is that where we are . The march of these markets . It is valuation versus reality of profits. Were just about to get the curtain raiser on profits. It has been more than two years since they were utah saw a drop. It is alums equity rally in 85 years. In 85 years. Lly there is a theory or have transport and industry both cracking along together. Stats. Amazing low volatility, what does that tell us . I am a great believer in options. Im a great believer in pain. A little bit of value to protect you for the long time. Exposed. Eft very er said if you have a look at the volatility, crashing below the 20 level, go back to the last big rally everyone remembers. Volatility is not a bearish signal they say back in the 1990s that the s p actually perform when volatility was low. My challenge is that oppenheimer would say that is all very well. 1990s, nonein the of our Central Banks were slamming the market. Challenge, myy humble challenge. , what are thenth markets telling us . Be worried. Pricing in a very different decision in the u. S. And the u. K. Five are marching ahead. That is concurrent with the view that it would rise. The fed, look at the tenure and the fiveyear. U. K. Are below the the u. S. Will go later than the u. K. , but what we got yesterday in terms of manufacturing, autos, etc. , the bond market might be a little filter. Early becauseday friday is a holiday in the u. K. Thank you very much. The acquisition is part of a wave of colonization best consolidation sweeping the industry. Airline hine joins us now. Good morning Caroline Hyde joins us now. Good morning. This will not stop taking place question might exactly this will not stop taking place . Exactly. Maybe it should not come as a surprise. Sheve been trying to wants a Single Market for telecommunications. She wants to break down the. They unveiled that they would be. Lashing costs more than half the price now if you want access our data. If you will be imposing that sort of look for that market and youre going to be breaking down there is, you have got to be aware youll break down barriers in terms of m a as well. It will not get the Revenue Streams from us traveling. They need revenue from somewhere else. At the same time come injecting money into building out the network and improving it, we want more and more facebook on our phone. You need improvement and infrastructure. Please allow us to consolidate and make transactions. Otherwise, this is a round peg in a square hole. T is worth remembering why have you got 27 fone will get from ono market share and cost savings of 2 billion euros. He will also be 1. 9 million customers. They need to be a bigger force in spain. Are they going to be investing in more mergers and acquisition . Vodafone has been trying to get ande other Revenue Streams something a little more attached to the ground. Yes, it data. He doesnt want to just access your data. It via television by vodafone and in your home. He wants vodafone to be an ecosystem for us. Companies. Up these he has been making purchases in spain. The next area he could be looking at is an elite. It is the third biggest market after germany and the United Kingdom comes italy. In italy, there is an erosion in revenue and the amount of customers. Many have started to think maybe they could go back and try to get ahold of fast web good to try to buy it in 2011. They do not manage to get their hands on it. They analyze wind. This is not just vodafone. We have had liberty global. There is also a Cable Company. Consolidation is a theme. Caroline hyde, but the latest on vodafone. Lets get an update on what happened at jpmorgan. Jamie dimon has announced that he has cancer. He started treatment and will run the company as normal. N says that his concert was caught quickly cancer was caught quickly and is curable. Jpmorgan became the largest u. S. Bank and shares have climbed 45 over his tenure today. Coming up on bloomberg, we will get the reaction to the simmons latest figures said latest figures. We talkr on the pulse about the state of the u. K. Housing markets. Program, should the alarm bells burying . Be ringing . We might be in recrisis territory in markets. Time for todays company news. Bmw plans to invest 1 billion in a new factory in mexico. This plan will be bmws second in north america and mostar start production in 2019. Uw is the last of the top three luxury car makers for plans to build cars in mexico. U. S. Sales grew last month. Sales of the a3 sedan that has a starting price of under 3000 attractive younger buyers. And a possible bidding war for club med shares. They say they plan to make a bid evaluating the holiday company. Welcome back to countdown. I am anna edwards. The 10th in london is a quarter past 6 00 this wednesday morning. N london is a quarter past 6 00 this wednesday morning. How long will it last . Joining us is my guest. See you. At to lets talk about these new highs on the u. S. Markets. The rally is now five years old. How old can get . We are sure everything is fine. He will have low rates forever. We get these kinds of assurances. We have the suspicion that now. N put in place we have money being printed in japan. There is a strong bet therell be money printing in europe toward the end of this year. We have incredibly low volatility. Tell me about the historical context. We have heard mixed views on whether it is a precursor. There have been occasions. It was just before the asian crisis. Just before the dot com collapsed. There is a similar complacency. We had similar low levels of volatility. Why is that dangerous . Is it a precarious place to be . Complacent. Feels everyone hunts for yields. Spreads incredible low on the credit. You have a general feeling of complacency through the markets. It is harboring any hovering. How low can they get . What are they telling us if they get lower . It will not see another 50 basis points. Certainly in greece and in spain in italy, we have dutch bonds yielding the lowest of 500 years apparently. A good run in had risky markets, maybe equity markets, it is a time to slowly divest. Im not a predictor of doom, but leave some chips on the table. You are not predicting doom. It does make you feel a bit nervous. Just how riskaverse would you suggest people become in the second half of the year . To awould choose a period safer level of investment so to speak. Would you want to reduce your risky exposures and holdings every month . We mentioned peripheral bond yields. You think there could be more quantitative easing. What makes you think that . It has been as low as 0. 5 . It will start to pick up. Wouldnt they have done it now with the unemployment situation . What is it that will be finally the thing that tipped them over the edge . Never underestimate the inertia of the ecb. Is getting them to be unanimous and dropping is doing up draghi is doing a fantastic job so far. Cutting rates negative for instance. Personally, i do not see why we have to stop at those basis points. There is a great experiment for the ecb. 10 basis points. Lets see what happens. Do you think anything they have been doing so far will be . Think Interest Rates and inflation adjustment 12 months up to april, we thinking to account weaker inflation . They havent necessarily been paying less. Have been very careful with their balance sheets. There is a complete paradox. The push and the poll. Exactly. Nick beecroft, more from him when we return. You are watching countdown. Welcome back to countdown. I am anna edwards. I am here with nick beecroft. Nick, lets talk about if there were to be a correction, where there be a change of direction . Where is the spark going to come from . Where is the spark going to come from . Property prices fell in china. You can get it by back on house. If you could get a house, they would buy it back from you and 40 higher than you pay for it now in five years. That is an Interesting Development in chinese properties. Right. What would you make of china . I am pretty sanguine on china. This is a country with enormous reserves. We are seeing the tweaking of stimulus. Reducing reserve requirements, etc. The authorities are all over it. Im very sanguine about china. If there is going to be a catalyst, what it is it likely to be . With the exception that major Central Banks maybe the fed are behind the curve. Yellen could say the figures are just noise. Shut up follow that and follow me. Wouldrice for the markets be a sudden change of direction on the part of the fed that rates will have to go come sooner than expected. We seem to be in a period where markets have been hanging on every word of janet yellen. Are we getting to a point where data will be in the driving seat . They have had us in the thrall for a number of years now. They have been on top of the markets. In the u. K. , it has been a tough first year. With a threshold on on employment. We are told that rates will be low forever. Then the bank of england was a price the market is expecting that is contradictory was surprised the market is expecting that is contradictory. If you like losing the grip of the markets at least the direction of inflation has been down. It it has. What we need to do is watch earnings like a hawk both in the u. K. And the u. S. That is the first sign of any trouble on that front. Great to get your thoughts. Nick beecroft joining us from capital markets. Coming up, vodafone is the to increase its share of spains mobile market. That is coming up. Welcome back to countdown. I am anna edwards. Lets head out to manus cranny for the fx check. Today. Dollar just below i will bring you some shocking news from the french Prime Minister. This currency is overvalued. Bad for industry bad for growth. The ecb needs to go further. That was the moment in time he spoke with this morning. That information hit. Janet yellen speaks with the imf. Says to sell or fade those rallies. Something from barely 24 hours ago. It is having a great run. This morning we come back. A little bit worse than the market and it ended. Keen an eye on that. Finally come a lets have a look at australia here yesterday it was a something moment. There it was. We had the manufacturing surprised. We get Construction Data today good will see what impact that has. Thank you very much. These are the Bloomberg Top headlines. Is under formal investigation for allegedly peddling influence according to agencyds french news in. Sarkozy denies allegations. Ukraine, minister from russia, germany, and france plan to meet after president vowed to take region from the violence torn east. The a showing teenager is the first man in a decade to reach the quarterfinals in his debut. Spains is edging into mobile market with its 10 billion acquisition. Now. Wner joins us thank you for coming in. Lets talk about this ono deal. Likely to be approved . Morning. I think it is likely to be confirmed. The competition if you issue makes it tricky across the market. It is not like the u. S. Where theres a unified policy. Tell me about that. I spoke to people who have been suggesting that they do want to treat the whole of europe is one big space in terms of competition. There are many more smaller players there are in the United States. What would there be competition issues. Want to make it a flat market as they should be. They want to make it a flat, economic playing field. How do they achieve that while allowing competition . These same time, allowed mergers to make Financial Sense of the Companies Involved . The issues are significant at the moment. Theyre concerned about the amount being invested in the network. We have to scale up in order to continue to force on upgrading their networks. Regulators be worried about the balance sheet. Isnt it up to them to talk about which Risk Appetite they want . Explain to me why. They have a responsibility by definition. The purpose is to make sure gdp grows in terms of their responsibilities across the union. If you dont have competition they want them to prosper. If you dont have competition, that means you dont get gdp growth. He economy stagnate your face is a huge challenge for the companies countries that are still developing their infrastructures. Is it the right move for companies to move away from being a wireless provider into a Cable Company such as ono . It is a bit of a misnomer. It is only the last part of that network that is mobile. What they are doing is it is not a change. They buy is a good idea. The reason it is a good idea is because in the end, it is better to go along fiberoptic. It is a more economically efficient process. The fundamentals are there to move toward a fiberoptic cable and the Cable Operators have most of that. The issue with the building is it might look attractive, but it is a time issue. By the time you put down your table, you may find it has been innovation in the optics, etc. , etc. Yet the other issue of getting the right away. It is not getting cheaper. , arecompany Like Vodafone they taking on too much debt to do these big acquisitions . Is there a price worth paying because they need to invest in and for structure . That level is not insurmountable. I think it is around 2. 1 or 2. 15. Im not sure it is that big of a problem. Telcos have a remarkable ability to generate nothing but cash when they choose to do so. People look at longtime contracts. If you want to stop spending on your network and just squeeze the company for cash, that is quite possible to do. Not sure it is that big of an issue. It is something to watch clearly. What are the weak points for vodafone . Say that the profits will be 11 lower than they were previously because of price wars. Where are the weakest points . Were not so worried about the net income level. That in itself is likely to decline somewhere else. The issue is there now on the downside. They are concentrated in one geographical mass. It is politically fragmented. That is the issue. A number of those economies are moving slowly, if growing at all in real terms. That is their challenge. They do have a geographical advantage of having network in the same space. What we are all hoping is for a playing field. Europe has to keep innovating and growing. The regulator has to keep helping. Christopher, thank you. Great to have your thoughts. Lets move on. Virgin atlantic turned 30 last month. It is celebrating with a highfashion makeover. Westwoodd new vivian crew uniforms last night they unveiled new Vivian Westwood for uniforms last night. These uniforms are not the only signs of a revamp at the airlines. They will get dreamliners in september. Itll be interesting as to what those will look like. I did ask if they could give hints on what inspiration would be. Both the uniforms and the new planes are so important for virgin. The brand is essential in terms edginessng the hip, the of the brand. They didnt look about punk. Vivian westwood designs them. You could see her influence. Crews walk virgin seven miles per flight. You can see how the shoes have to be appropriate. You mentioned you were looking for clues as to what theyre going to be buying. There are number of aircraft. Absolutely. They will be getting a dreamliners. They are considering another order that they will consider. They are keeping their options in for the dreamliner stretch and the 777. Says it is not an essential issue. They can extend the lease. Again, this is about keeping the brand fresh. It is great to have new uniforms and all of that stuff. When you are the passenger, you care about entertainment, deceit, the food, the inflight experience. Those are the things the food, then fight experience. Those are the things customers care about. You do notsaying have your finger on the popculture . [laughter] lets talk but his goal to make the Company Profitable again. He has been there for 18 months. How is he doing . Losses. Have had their he has bedded in a relationship with delta betted in a relationship with delta. He has definitely been influential in getting that to work. Their service is facing some issues. The summer will be interesting. You have Norwegian Air that is starting services from gatwick today, we will have to see if the demand is there to keep prices for virgin. Thank you. It seems like two letters are all you need for an app to go viral. We have a preview of how the yo app works. Yes. After the break, i give you all app. Etails this little there you go. It is about everything and nothing. It took about eight hours to build. I will be telling you what it is all about after the break. Welcome back. Time for todays world cup news. Theyll jump has secured its spot in the quarterfinals. Has secured its spot in the quarterfinals. Cameroons football investigation is looking into allegations that a player fixed games at the world cup. Cameroon lost all of its matches and was eliminated with the worst record. Resilient football fans are collecting beer and drink cups sold at the side of the world brazilian football fans are collecting beer and dr