More on that exclusive interview to come. Manus you are welcome to countdown. Anna a warm welcome to the program. It has just gone 6 00. Lets talk about the oil price. We are back up at 41. Both wti and brent equal with each other right now. Not often that you see that. No differential. Anna late last night, we had a member of opec talking about his expectations about the oil price, something moderate, but not high. That is even if iran does not agree to enjoy the growing group of companies that have agreed to implement some kind of production freeze. 15 out of the 16 nations are coming together in delhi doha. We do have a chart. This is Oil Production. U. S. Daily Oil Production is just coming lower. This is part of the strategy that opec would say. Wti is trading in the opposite direction. This is about many consequences. Have a look at this. Up for not had the ruble a wild. It has gone from being the most tortured soul of a currency to one with reprieve. You have a shift around the market potentially getting ready. There is sentiment out there that you could see the central bank come in and intervene because they are happy with this lower ruble. Dollar, do you believe the San Francisco fed, williams and lockhart, that maybe the fed could be more in play than we thought . The dollar iswhat doing. It is pretty much flat. Hawkish comments coming from John Williams and dennis lockhart. Lets get to bloomberg first word news. Good morning. The yields on 10year u. S. Treasurys grows the most in more than a week yesterday. That was after two Federal Reserve officials suggested the central bank may raise Interest Rates as soon as next month. There is evidence by the Economic Data to justify a further step at one of the coming meetings. A further step in raising rates, possibly as early as the meeting scheduled for the end of april. The European Central bank and the bank of japan are essentially trying to push down the value of their respective currencies with the use of negative Interest Rates. That is according to the view of mervyn king. The Central Banks are trying to push down the exchange rate. Are countries in the world saying, if the rest of the world was going normally, we would be fine. What is left . Push down the exchange rate. Not everyone can push down the exchange rate. Most countries are trying to do that at the expense of the dollar. Now the Federal Reserve is concerned about the strength of the u. S. Dollar. Preparing to defend his budget. Is talking about his deficit reduction. Brushing off decades of distrust, barack obama and to been president raul castro have shaken hands. Both men expressed hope for the improving relationship, but also highlighted deep differences. The relationship between our governments will not be transformed overnight. We continue, as president castro indicated, to have some serious differences, including on democracy and human rights. Firms haveancial shifted bonuses to increase female representation. According to a Government Commission review of gender diversity. It stopped short of calling for mandatory goals. The founders of one of the founders of intel has died at the age of 79. Grove played a key role in building it into the Largest Semiconductor maker. He was also a mentor to steve jobs and larry ellison. Bill gates said he was at the forefront of creating the whenever we spent time together, i always came away impressed by his brilliance and vision. Global news 24 hours a day, hard by 2400 journalists and more than 150 news bureaus around the world. Manus lets get straight into these markets. We are seeing a little bit of a hole from the chinese in terms of what they are doing about the fixing of the currency. Yvonne it is important, but we have fallen below that once again. We saw shanghai snap out of those seven days of gains, which was the longest stretch of gains we have seen for some time now. Shanghai now down. 2 . Mostly in the red. Not getting too much of a catalyst to push stocks higher. Some analysts say we need fresh news. With the exception of japan, which is coming back from a holiday. Nikkei endingthe to day close to 2 , close session highs. The weaker yen driving stocks, giving a boost to some exporters. Manufacturing pmi data showed contraction in march. It was the lowest reading that we have seen in three years. I want to talk about some tech news today. That was a big sector, newsgenerating issue. 9. 8 in taiwan after it was cut to sell. Nintendo surging after its smartphone at reached one million users. This is its first foray into Smartphone Apps. Dena, a company it is partnering with, is also rallying as well as they make the transition from consoles to smartphones. When you talk about the dollar rally, we do see that continuing today. It is the Malaysian Ringgit seeing quite a bit of strength. This level for the First Time Since august, strengthening 1. 4 . Anna thank you. Yvonne man in hong kong. Technology names in the asian session. Lets stick with the technology theme. Hearing hasne court been canceled after the fbi said it may be able to access data on the terrorist device without apples help. U. S. Government wanted apple to create software to override security features. Ceo tim cook remained resolute, saying he is not prepared to compromise the privacy of millions of users. We did not expect to be in this position, at odds with our own government. But we believe strongly that we have a responsibility to help you protect your data and protect your privacy. Weoh it to our customers owe it to our customers and our country. This is an issue that impacts all of us. Shrink from this response ability. Anna joining us now in the studio, david, Global Market strategist at j. P. Morgan Asset Management. We also have details on the apple story. The government canceled the court hearing. Really quite unexpected, wasnt it . Particularly the cousin came from the government side. They said the government wanted to test a possible message for accessing the data a possible method for accessing the data without apples help. Department did not identify who actually stepped forward with this new method for unlocking the phone. That is a bit of a mystery. If the method works, it could eliminate the need for this court case against apple to continue. We are talking about a landmark case that could redefine the boundaries between personal privacy and national security. That has been avoided, for now, until april 5, when the government will file a report. Manus he for the news broke, tim cook addressed the issue during the product launch. Saying it is for our protection in terms of using the product. He actually kicked off the launch talking about this case. He said we need to decide, as a nation, how much power the government should have over our privacy and data. Of course, what came out of it were no real surprises. A new, smaller iphone that would start at 399. He talked about a new ipad and cut the price of the new apple watch. The iphone will have four stainless steel finishes and a faster processor. Share price reaction was not great. Fairly muted. If history is any guide, the stock could improve in the shortterm. Since steve dobbs steve jobs died, apple has gained an average of 1. 5 a month after product launches. Three months after a launch, the shares tend to all 1. 8 . Tend to fall 1. 8 . Anna thank you very much. Lets get to david, Global Market strategist at j. P. Morgan Asset Management. Your thoughts on the tech sector as a whole . Clearly a lot hangs on these new launches. What is your big picture view . David when you look at apple, two of the things that markets are worried about, Pricing Power , low inflation, nominal growth, and liquidity. Pilehave a huge cash internally. This is a linchpin of a number of portfolios. I still like where the tech sector is going. It is leveraged to the strength of the consumer. The case for economies and markets around the world. Furthermore, if there is any spending,business spending designed to remove the need for further labor, technology is leveraged to both of those themes. I think it is a good place to be. Significanthing when you think of a company like apple. We wrote a case when that talks about the premium. Industrys90 of the smartphone profitability. They are taking a step in terms of changing direction. Evolution to come from the area . David you could take a bull case or a bear case. Apple is one of the most powerful brands in the world. We know what a powerful brand does. It allows you to have margins because people will pay up for it. Apple is going to run into the problem of large numbers at a high speed. They are taking a little bit of a risk. They had the colors. That was a bit of a flop. They are a premium brand. Manus cutting the price of the watches as well. I dont know whether this is a moment of desperation or appealing to the chinese market, which is huge. Manus one of our analysts in taiwan wrote a piece on bloomberg. Com which talked about why this would be better than is not beingse it pitched as a cutprice model. He says it is a midcycle release which builds on the features of the previous model. Spending a little less but you are not getting less for your money. That is the message. Away from the tech scene, what do you weigh the tech sector up against right now . What are you moving away from in favor of tech . David the big question in my mind is where are the financials going . They have had a rough time. In aare transitioning world where Free Cash Flow is maybe going to be king Going Forward. Utilitiesme of the look a little bit punchy at these levels. Most of the centralbank action we have seen is probably in the price for bond yields and bond proxies. There could be some vulnerable bonds. , until we getme past a few forces that are driving us, such as the reduction in manufacturing and energy globally that we are seeing from the oil price and the fallout from that, i understand why people want to stay slightly more defensive. Manus stay with us. You will hang out for the next half hour. Anna lets take a look at what is on the slate for the day. A slew of pmi data out this morning. Ifoour after that is the Business Confidence out of germany. Manus 9 30, we get inflation and ppi. Then we are back to germany. Anna in the u. S. , the political race for the white house continues. We have seen arizona, utah, and idaho. Manus up next, the chinese conundrum. Pressurening yuan puts on luxury brands. Our exclusive interview with the ceo of ferragamo. Anna welcome back, everybody. This is countdown. You are looking at a live shot of hong kong. The hang seng is a little weaker at this hour. Lets get to the Bloomberg Business flash. Shares in valiant pharmaceuticals surged the most in three months yesterday after bill ackman joined the board and their ceo was ousted. At the same time, valeant accused its former cfo of engaging in Improper Conduct and led to the Company Filing a financial misstatement. Schiller refused to resign from the board, saying he did nothing wrong. Deutsche bank may have its Credit Rating cut by moodys on concern that germanys largest lender will struggle to carry out an overhaul and improve profit. Moodys says through changing leadership and recalibrating its the outlook has only worsened for deutsche bank. Have fallentrograd in afterhours u. S. Trading after they posted a surprise fourthquarter net loss caused by unprecedented asset writedown and falling oil prices. That is your Bloomberg Business flash. Manus thank you very much. Ferragamo makes 36 of its revenue in china. Ahead of its annual investor meeting, the companys ceo spoke to francine lacqua. She asked if recent market turmoil and the slowdown in the chinese economy has had any effect on sales. , i believe there is not an immediate relationship with the stock market. There have been a lot of things about the number of chinese buying. I do not believe this so much, direct involvement. I think the Stock Exchange is still closer to gambling. Sometimes. Y moving what you feel is the mood changes. Strong impacta move. Macau, and in terms of the everybody convinced of 6. 2. E midterm growth still, you see the kind of confidence. Manus lets get davids take on everything. It is about adjusting the Business Model in terms of changes. We have had some significant shifts in terms of how the luxury businesses are doing in china. David indeed. This is part of the vanguard of changes that china has been trying to make, clamping down on the luxury spending. Of course, the impact of chinas slowdown on luxury does not stop there. That is kind of a sideshow. Chinas growth pushed up emergingmarket growth around the world. That created pockets of wealth. Those pockets of wealth were spent on luxury goods. That has been one of the key theers of the earnings in consumer global discretionary sector. Some of the expectations for those firms got out of control a year or so ago. Now we are seeing similar expectations of what they can deliver on earnings adjusted down. Anna where do you focus your concerns in that regard . Are you talking about other countries within asia or further a field afield . I think both. I think it is now pretty much in the price. We have seen the selloff in a lot of these emergingmarket which means the luxury goods become that much more expensive. You have seen areas of real , thee, such as florida brazilians are not there and the mexicans are not there. You have seen the rest of asia adjust to a less buoyant chinese luxury consumer. Chinass not mean that economy is going to fall apart. I agree with what the ceo was saying. The stock market and the economy are two different things. Entered atential he healthier phase of chinese growth. Less about wealth and luxury and more about services, employment, and the retail sector. Rebalancing is the critical point. I was in paris yesterday. One of my guests, who travels to china a lot, say that chinas response to the global recession has manifested itself. We talked about the two things being completely divorced. This is trading volume. You can see the interference. We have had the first drop in eight days below that 3000 level. We have rebounded by 13 . The two things are different. In the psyche of markets, what happens to the chinese equity market. Even though we say we should not pay much attention to it, it does david the first thing anyone checked before they came to the studio, you would check what happened in the shanghai stock market. Manus is that because of intervention . David a little bit. It was coming down from extraordinary highs. The biggest show is the currency. Can be a market significant part of the emerging market portfolio. I am ok with my fund manager picking a couple of things that they have conviction over. The bigger issue for Financial Markets is the currency because ramifications. We still think it will get another 5 6 down in this currency by the end of the year. Will not thinks that cause volatility in the markets, they are kidding themselves. Anna i read a great story about how the pboc managed the stock crash last year. Does that give you confidence that they talk to each other in that way . David i think it is heroic, right . [laughter] a good bit of positivity early in the morning. He would love to think that the world Central Banks do talk. They havehat publiclyavailable documents anna you are raining on my positivity. David stays with else stays with us. A short break. Hohey s woiit ghong, estcak . Hoestcak. Th lais p hceotas hke hyso wn arett ey llkelica hotkes . Cwithstomcain business rnan fid e. Ju ddst aus a czetomimeey e y towiour rofi pas splgeh pa an ud yo ll yeachstr somer eie esr a adylr ju ddst aus a czetomimeey e y diresevicfi pas splgeh pa. Or upder. Odintrg ucin pwifiwiro, fi hthatpsyow usur bs. Ines u doe t eth dvery. Nebusiss. Ascomcbu. Ss t builbufor sssine manus 6 30 in london, 7 30 in brussels. Lets get the bloomberg first word news. Good morning. The u. S. Government says it may not need apples help j hgrtoce coheg foda after the Justice Department said a third party suggested a way to access the phones data. Apple says it has no information about the claim but once the government to share details of the security vulnerability with the company if the case proceeds. ,pple has unveiled a new smaller iphone that will start at 399. That as the firm seeks to jumpstart sales by enticing more users to of grade, especially in highgrowth markets such as china and india. The new iphone has a fourinch screen and incorporates a faster processor that runs the larger iphone 6 s. The yields on u. S. 10year treasurys rose the most in more than a week yesterday after to Federal Reserve officials suggested the Federal Reserve may raise Interest Rates as soon as next month. There is evidence by the Economic Data to justify a further step that one of the coming meetings. Further step for raising rates at one of the coming meetings. Possibly as early as the meeting scheduled for the end of april. George osborne is preparing to defend his what it he addresses Parliament Later today. The u. K. Chancellor is facing a cabinet revolt over his deficit reduction. Iain duncan smith quit over the weekend. One of the founders of intel, andy grove, has died at the age of 79. He played a key role in building intel from a 1960s start up to the worlds Largest Semiconductor maker. He was also a mentor to steve jobs and larry ellison. Bill gates said, he was at the forefront of creating a personal computer industry. Whenever we spent time together, i always came away impressed by his brilliance and v