Monte paschi get more time to complete its Capital Increase . And finally, when court and Qatar Sovereign Wealth Fund join forces to purchase an 11 billion stake in rosnet. Is Ivan Glasenberg back in deal mode, matt . Matt absolutely fascinating story, that. Of course, Global Markets are going to be captivated by mario draghi, but it what deals are going on in oil. At 1 45 p. M. Local time in frank for and at 2 30, when he holds his press conference. The three main things to Pay Attention to from draghi will be number one, how long does he qe program and how much will he spend . Will the hold out 80 billion euros a month . How will he buy bonds in countries where he has already reached the limit . He will hit the limit in germany by midsummer at this pace, which he will if he extends at the rate he has been buying so far. Number three will be, how will he taper . When is it going to start . How will the pasth be, shallow or steep . Investors will be looking at all of that very closely. Guy we will be looking at that very closely throughout the program. Some great guests will be joining matt as he worked our way towards that decision, which of course, we will bring you. So, what are we looking at on my bloomberg . Lets talk about equity markets. They had a solid session yesterday, but today on the fair value population, we bid up again. Teh fhe fair value graduation is called up by 0. 4 this morning. Lets get this to move. We can show you the gmm. There you go. That is the ftse 100 yesterday. The best day in three months. Germany, up by nearly 2 . Down,eature is this drop allowing you to put a time component into this. This is since the italian referendum. Look at the dax, up 4. 5 . T up 4. 5 . The banks are a big part of that story. We will discuss that throughout the program. In the meantime, here is the bloomberg first word news. Reporter thank you. Chinas exports rose last month, snapping a sevenmonth losing streak in dollar terms. Overseas shipments increased by 0. 1 from a year earlier. Rose 6. 7 ,imports versus a projected 1. 9 decrease. That is the biggest rise in two years and leaves 44. 6 billion in trade surplus for china. Matteo renzi formally resigned late yesterday, but the countrys president will not let him leave. Sergio said he would delay accepting the resignation as he begins talks with the italian Political Parties this afternoon. Renzi is stepping down after suffering defeat in the referendum on constitutional reform. We obviously have to go through an internal transition that i think will be hard. It will be very hard, as we have to be transparent, which is neither for a Great Democratic Party to stand out, but that will lead to come after we have tackle the crisis of government that is about to formally begin. Reporter the u. K. Prime minister has won lawmakers backing to trigger article 50. This came after she gave women the chance to scrutinize her plan first. Today is the fourth and final day of the Supreme Court hearing into the governments handling of brexit. A guage of u. K. House prices rose to a sevenmonth high in november. The Royal Institution of chartered surveyors said the index rose to 30, the struggles reading since april. Global news 24 hours a day, powered by 2600 journalists and analysts in more than 120 countries around the world. This is bloomberg. Matt . Matt guy let me pick up. Mario draghi is expected to extend the ecbs qe program. The question is, will he taper after that, or keep goign . Or keep going . Euros,tays at 80 billion he could do it for so long, but at 60 billion euros, he could do it for even longer. So, what clues are we looking for today . What is the set up, matt, going into this . Matt i mean, first of all, that is a very good point, guy. If he goes, say, a thinner, but longer qe, down to 60 billion euros for i nine months or a ye, will investors read that as the beginning of tapering already . Will that be a plus for the euro , but a problem for the italian bond market. Earlier Joerg Kraemer told me that could be a concern that devolves back into a sovereign debt crisis, which nobody wants to see, the least of which, draghi. The other question will be about the capital key, how many bonds can he still buy, even if the buys over the capital key . One of the solutions could be that right now they only purchase between the maturities of two years and 30 years. If they change those rules and they allow themselves to buy less than two year durations, that will change the denominator and then change the ratio, allowing them to purchase more bonds, even if they are not at the very front of the curve. Guy so much to think about. The mechanics of this are very difficult to think about. Our guest. To where is the upside for mario draghi today . It seems there is a potential for december the third disappointment. The market is disappointed. Is there an upside surprise that draghi can deliver . I think we have to remember that Central Banks are very vain. They will take credit for the fact that fiveyear european inflation is not 1. 7 to 20 , getting towards a target of 2 . 1. 8 , getting to towards a target of 2 . Inflation expectations is rising, which is what they have been trying to do with the qe program. To some extent, the market will be disappointed if they are looking for the usual dovish draghi. And the fact that the market has responded in almost the reverse way we expected, allows dragh draghi to take some credi. Matt we will not just here about qe and extension, but also about draghis excitations were growth and inflation. Do you think that the italian referendum plays into those expectations . Where do you see his forecast coming out today . Of course, the forecast is written in stone, in terms of the research being done, but the interpretation is up to the ecb and draghi. I think that will be that the market once again, could take one of these negative scenarios. He will see that is very positive and a confirmation of their policy. Of course, i totally disagree with that policy, but that is how he will see it and the wording he will give us today, that they remain confident and will stand by italy. And he will be asked about the italian banking crisis, of course. He will say that its up to the authorities in italy, but the ecb is doing what it can. I think we will get a very confident mr. Draghi and ecb talking to the point that the fundamentals are breathing steadily, but the metals are improving steadily but the fundamentals are improving steadily. The donald Trump Victory and his, you know, possible stimulus boost has already led to a 2 trillion rotation out of bonds and into stocks. Also, to an incredibly strong dollar. Has that affected Mario Draghis policy prescriptions, or should iit . It showed in the sense that the u. S. Dollar has been a resurgence currency of the world. So, the dollar getting stronger means the potential growth rate for the u. S. Goes down, which means it goes down for the world. There is very Significant Impact they will look at, but again, he will not talk to the point at all. Icsrall, i say the trumpenom is very much about expectations. To a large extent, i think we will have, in economic terms, it is net neutral. If you look at the import barriers and labor market and the rest, that is. The market is having a good december. The momentum always exceeds what we expect in trading terms. This will be the trump ability to change. The cabinet he is building, advisers have been trying to tell us that trump will be very different as president than as a candidate. I think we have seen that trump the president will be very much like trump the candidate, unfortunately. Guy he will talk about that more later on, but you spoke of the exuberance. This is the spread widening. Do you think draghi will be concerned about this . He is talked in the past about financial fragmentation within the eurozone. Again, we will come back in touch on that in a moment. Nevertheless, do you think he is comfortable where the bond market is . Yes, and unfortunately, i think he thinks it is a lot of the doing of the ecb. Which i think is actually wrong. I think it is more of a mechanism transpiring from the Monetary Policy. Guy where would the spread be, do you think . 300 plus. Guy and what he be comfortable heh that . And would become to with that . Know, but i think as italy gets worse, it increases the odds of a pained european decision. The fact that germany sort of remains always very skeptical, they could be forcing italy could be forcing their hand. I think that is his concern over all. Guy we will come back again and focus on italy throughout the program. Big decisions still to be made in that country. We will have full coverage of the ecb decision. 12 45 london time. We will also of course, have the press conference for you as we listen to mario draghi. Coming up later in the show as asks italys president matteo renzi to remain in the top spot for a little while longer. Plus, glencore dealmaking returns with a wager on oil and putin. We have the details on the rosnet deal. David cole will be joining matt in frankfurt. The ecb and euro, that conversation coming up at 8 40 u. K. Time. This is bloomberg. Guy lets check in with Juliette Saly and the Bloomberg Business flash. Reporter glencore has confirmed this morning that it is in final stage talks to purchase a 19. 5 stake in rosnet. The 11. 5 billion deal also involved qatars sovereign wealth fund. President putin announced on Television Last night that the agreement had been struck. The chairman of bloomberg lp, the parent of Bloomberg News, is a senior independent nonexecutive director at glencore. And documents disclosed by Deutsche Bank provide smoking gun proof that lenders, including ubs, hsbc, and the bank of nova scotia, rigged the silver market. Plaintiffs submitted a filing yesterday, eight months after german banks summit a lawsuit over claims that the manipulative gold anselmo prices. Every that it is representatives of the banks did not immediately respond to the emails. Guy thank you very much. Monte paschi has asked for more time from the ecb to complete the 5 billion euro Capital Raising plan to january 20. This is as it struggles to attract new investors. Moodys has changed the italian credit from negative to stable. Chart to nice little show you this morning. This is something that has crept up on us. This is the italian bull market. The raging bull, not lamborghini, but the ftse. We have taken ourselves all the way back to the brexit levels. In terms a big moves, of the actual point, but that is a 20 move. Steve jakobson, please explain to me how italian assets have bounced post this referendum. As far as i can tell, italy remains within an economic and political mess. Unfortunately, i only have a degree in economics. This is the greater fool theory, and a huge decision in the italian equity going into the referendum. Italy is now going deeper into a recession. It will have a bureaucratic government, probably all the way through 2018, when the next election is due. That election will put them into a leading position in italian politics, the five star. We are talking about 54 governments since world war ii. The ability of doing a nonperforming loans reduction in an environment with less capital i mean, you have the negative spiral of not having the ability to raise capital and the state cannot intervene. Enjoy the moment is my advice for the investors in italy. You have to remember, in trading, momentum is the strongest component and it tends to overextend its time relative to fundamental value. In other words, you can have the market trading way above or below its actual value, but ultimately it will have to mean rebirth. The firstrate will be the first trade will be against germany and other spreads. I will do more studying on the behaviorals side of things. Guy we all need a degree in psychology right now. This is kind of entertainment in some ways. Book ofblack swan 2017, 1 of the big calls is by italian banks. As you point out, if you go back and read those over the last few years, the big outliers have turned out to be true. Rublet year we had the and brazilian market. Last year we said the emerging market was the very thing you did not want to trust. Saying ear, we are and i think it is kind of a deduction of crisis as well because what we are really arguing is that the italian Banking Sector is at such a level, visavis the brexit talk. That can force italian banks into a situation that will spill into the rest of the european Banking Sector. One of the most vulnerable will be the german sector, forcing germany to cave into a more supportive role. Er since outperform or the italian referendum. Which proved again this was not the story about the fundamentals. Not,er you like it or whether you are liberal or not we have to agree that germanys policies are taking europe apart. If you look at what merkel has been saying, she very much believes in a eurozone. She wants to be the one who consolidates the european story. And i think she has a huge chance this autumn. Helande, as a candidate, gives france a change. That means these deals can actually make the italians get the rescue by being part of a bigger problem. Borrow a very trump, he will be three times bankrupt, but president of america. Guy steen is going to stay with us. Your stocks to watch include glencore this morning. We will tell you why in just a moment. This is bloomberg. Guy welcome back. 54 minutes past the hour, five minutes to go until the market opens. We will be talking to the ceo within the travel sector. Estimates were missed on a four year revenue. We will see how the stocks reopens this morning. The ceo, coming up first here on bloomberg. Another stock to focus on this mornings glencore. There is some confusion about where we are with this deal regarding rosnet. Nevertheless, it appears as the russian president has gone on president and talked about it. Anyway, watch that stock story. We only just got back to the point of which, Ivan Glasenberg was talking about doing dividends. We will see how this one turns out. Futures are pointing positive at the moment and the european cash open is coming up next. This is bloomberg. Anchor good morning. Welcome. It you are watching bloomberg markets, the european open. Im alongside matt miller. He is in frankfurt, where it is called. Moments away from the start of european trading. Here is your morning brief. Draghi callrio equates on the ecb . We search for clues on when it will end. The italian job. Topeo renzi tuesday in the spot for a little while longer, but will monte dei paschi complete its Capital Increase . From russia, with love. Joining forces to buy an 11 billion stake. That in deal mode. Let us talk about where we are tracking these European Market to go. We saw a rally in a close and intoally getting a bull market. Let us see exactly where we are going today. We are expecting these lines to point upwards this morning. London beginning to push up. It will be interesting to see minors to do today. We are taking the focus to continue on what is happening in italy for the ecb. It is the big story. The details, let us go to manus cranny. For thed after record dow and the s p. Have i jump the koolaid . Manus the rally was set long before trump came to pass and we are perhaps over focusing on the reflation trade. European equities are rallying. The euro is up 1. 75 on the month so far this month. European equities rallying. Are storming ahead. Forgive me. This is the western european complex you want to look at. Europe in terms of evaluation to the United States of america is at the cheapest since 2009. You are looking at 14. 2 in the thepean union and 15 in United States of america. We have had a rally. Those that differential, that doesbegin to close . That differential begin to close . The value has been wiped off the bond market. One of the worst performing bond markets has been yes, these are march 2017 futures. 124 is where we have been trading. Prices rising in the latter part of the last number of days. Market. E the gilt equities are up and rising. One woman in the house can break down the details. Good morning. Here are some of the movers i am focusing on today and starting with unicredit. After it agreed to sell its 32. 8 of its bank unit two ensure nejra this is part of the italian lenders plan to boost capital and it looks like investors are liking it. Im focusing on qe, europes biggest tour operator. Pretty much unchanged at the moment. It was a beat. Operations as well as the fouryear results from those continued operations. On a conference call, in terms of brexit, the ceo said he does not see a negative impact from brexit and also, bookings indicate a good summer for the 2017 season, but a little bit of a muted reaction to those results at the open. I wanted to take a look at ocardo not moving too much at the moment. Agreeing that International Deal is a marathon not a sprint. The Sales Numbers for the full year was a beat for ocado. The Health Care Stocks were the worst performer on the stoxx 600. In asia andally dip the u. S. After President Donald Trump declaring himself an opponent of high drug prices, but they seem to be holding up in europe. Matt. Matt thanks very much, nejra. In standing at the ecb frankfurt waiting for Mario Draghis decision first and press conference later. Three main things we will Pay Attention to from the ecb today. Number one, the extension of qe. How long and that was level are we going to see qe extended . Number two, the rules around the bond buying, are they going to have to change the rules to allow them to continue . Number three is the tapering. What is that tapering going to look like . A kind of trajectory will it have . Mario draghis qe will look a bit like the ecb building this morning shouted in fog. He wants investors to know it is there and solid but they are not exactly sure wher