Gap with its peer group . Unfair and punitive. That is what Canadas Foreign Affairs ministers calling the lumber levy. Matt very much looking forward to that conversation considering how hot this story is right now. You look at futures. We are looking at slight gains, the price looks better on the wti screen. After little gains yesterday, they jump on monday. We are looking for gains again today. Check out the bund spread from treasuries. 96 going back to 1999. If you zoom in since then, you can see that we have come down substantially and we are now down below 2 again for the second time. The spread is getting thinner between buns and treasuries. Guy whether we will see that tighten up significantly, it is something we will watch carefully. Money is flying into European Assets right now but mainly equities. We will talk about on throughout the program. New zealand up nicely overnight. The nikkei up 1. 1 in asia. Many of the European Markets strongly bid. Off itsnese yen is highs. Why do you need a safety trade went through one happy about the direction of travel of their long equities . There are so many questions to ask about this rally. What is the momentum question mark lets get a bloomberg first word news update. Credit suisse has announced plans to raise 4 billion in the Rights Offering abandoning its intention to hold a partial ipo. The lender ran into opposition from analysts and investors who questioned the merit of splitting a business that generates more pretax profit than other units. Credit suisse announced firstquarter net income of hundred 96 million for swiss francs beating analyst estimates. Click under normal circumstances , that should be it. Alwayss always part, we said complete restructuring. About 900 million of restructuring costs to go through, continuing costcutting. Is in abanko santander fitting from the return of political stability to brazil with the rising real driving a jump in firstquarter profit. 1. 8 7 billione to euros beating estimates. Profit from the biggest market jumped 77 from a year earlier ther the president boosted economy following the impeachment of dilma rousseff. Theresa may will host European Commission president sean klug jean claude junker. It will be the first meeting with vanier. German ll face jeremy corbyn. Softened yourhas position on europe. Speaking on the countrys mostwatched television station, she refused to be pinned down on whether she wanted to leave the euro, a position she has championed in her campaign. Used a appearance to her parents to attack centrist rival emmanuel macron. Are we going to vote for someone who has a global ub as a whole . Society the policy is fratricidal. I said it. Fratricidal because it is aiming to rise up committees against one another, drive employees against one another, especially with the directive of hosting workers he will not question. Returnsemmanuel macron to the campaign trail after criticism that a victory a victory dinner he often his team was inappropriate and premature. Attackedist candidate le pen for what he calls her brutality. Madame le pen, her formulations, her town, her gesture, i see much more brutality than on my side. Brutality chooses its side. A brutal project, heinous project, a project of rejection is not on my side. On the other hand, i not presenting a project of a joyful liberalization. A naive one. I just take we are a part of the world. France is part of it. Sophie stock market valuations have become divorced from reality at the likelihood of tax policy changes to drive Company Earnings has slipped, so says David Einhorn in a letter to clients. The nasdaq closed above 6000 for the First Time Ever yesterday. He warned previously of inflated equity prices caused by central bank is in. The firm said tax reforms pushed by donald trump could be a boon for Economic Growth and favorably affect [inaudible] global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. You can find more stories on the bloomberg at top. Guy thank you. Up on that einhorn idea. Details on what has been the great driving forces of the trump rally. The u. S. President said the tax reform and will be announced. It will include a 10 tax on the more than 2. 6 trillion in earnings that u. S. Companies have stockpiled offshore, mainly tech companies. Sachssg asked goldman chief economist about tax reform. Backs we expect something that deficitit not decimat neutral. Boost rs not modest boost to growth. Guy lets get another take on this, bringing in mark cudmore. Lets talk about this tax plan. We had a debate about this this morning. What is this that is driving this equity rally and what will keep it on the rails . The french have had a good go at it, they boosted us up. Do we need a tax plan to keep us going . Mark i am not sure we do. What has driven this is that global data continues to be strong trade there is an uptick in growth expectations around the world. The u. S. Is the one lagger. It is not growing as quickly as people hoped at the start of the year. The rest of the world doing well. We have moved beyond all these geopolitical risks whether it is European Election risk or north korea or syria and the russianu. S. Detente, whether it is trade wars, we seem to be moving beyond them. People have excess cash and they need to put it to risk to use. The tax man could be a massive boost but he might also deliver nothing and there is the chance that the market goes, we want to see congressional of people first. What you promised may not be what comes into law and therefore we will not get too excited. This is a market that wants to rally, investors want to chase it. Mark they will want to see something by next year. They will want to have something there but for now as long as you headlines aggressive from trump, isnt that a catalyst to boost this market higher, especially the u. S. Market . Mark i think so. We see this real positive headlines and they will spin them the way they want. When you have this speech you can choose what you take from it and what you think is most relevant. It is a speech about proposed plans, it is not hard data. Estors can choose to sit what to fit their narrative. U. S. Stocks are going up, they will probably make record highs soon. The worst case is we get a bit of a negative shock. Is worried for a few days but it means a delay of a few days. A few days later we will be focusing back on the positives from tonights speech. Whatever happens it is the amount matter of timing before we focus on the positives. Guy lets talk about technicals. Ice line in the mliv the positive momentum signal we have, it has returned for the s p 500 so that is important. It needs confirmation. Give us a sense of what the sense of it is now. Valuations are rich but momentum is a massive factor. Mark went of the hard things is we are in 1 of the record high and s p index. It is hard for a trader who is not long already to have access cash. To admit to themselves i am underexposed, and i want to buy and now before the record high. When we break into that new range and break that record high, where is the resistance . Nothing you can cling to. Psychologically, trumps speech can give him the excuse to go, i am going to buy now the for the break but technically we want to see the high break sometime in the next few days then give us the next big leg higher. Time. Thank you for your you can follow marks insights and his Teams Insights on the bloomberg mliv blog. Very keen right now as we are getting deeper into earnings the season and they break down the tea earnings as well. If you feel like you need to catch up, that is a easy footnote for the market. Coming up on the show. We are live in zurich where we have been speaking to the Credit Suisse ceo. Reportedk income that income beat the streets estimates. This is bloomberg. Matt welcome back to the European Market open. Credit suisses income has eaten estimates. It is raising 4 billion in a Rights Offering and has abandoned plans to launch a ipo. Ceo ine lacqua to the zurich. Has been a good quarter. If you think about the work we have been engaging in. Up 18 and costs are down 11 . That is what we have been trying to do, drive the costs down and preserving the franchise and the revenue power of the company so we are profitable. We finally had a quarter. Is able tot the bank produce today. Even taking into account all the losses we are profitable. See that is across the board. That is for we have done in the quarter. That is across the board. We have good profit across the board. Global market up 29 . 15 and capital down 12 . This was the target we had given. Francine the International Wealth management could have been stronger, are you disappointed there . Guest no. We really did well. , wee is one of the profits sold city airport. Management and Wealth Management was up 400 . Better not wish for a quarter. We had a number of tailwinds. In credits we had when hundred 33 increase which i think will be market beating because markets have been very constructive and supportive. It is a good quarter. The numbers speak for themselves. That means the end of the restructuring. We started at 73 billion. That is enough to close it down. Francine why did you decide to theo the markets instead of ipo of the first unit . That ise were seeing something that we got right. We needed 9 billion of capital. Internal one for measures. 224 billion in 2017. We have thfuel and e the ipo as an option. That was entirely under our control and we have not yet proven the value of the concepts we are talking about. We feel now that with the progress for five quarters we raised 27 billion last year, another 12 billion this quarter. We believe we have been demonstrating the quality of the power of this platform and beating the competition. Capital. Ply raising hen weore palatable and w were thinking in october 2015, we had two big things ahead of us. A big writedown and [inaudible] we had a goodd, range of outcomes. In decembert january, completely reset the dials. We can look at our Capital Planning without huge uncertainty. When you look at it and that context, we have no downsides. In the coreive strategy. It was something we were willing to consider given the more it magnitude of [inaudible] ae other thing is huge improvement in the business. Profit is up 15 in two years, the company had been prepared to be ipoed. Having looked at both, a straight Capital Raise is less [inaudible] we dilate the shareholders bless and keep 100 of a good cash flow of a very good business. Us live. Ncine joins will this new strategy go far enough for investors . I feel like this bank is constantly cutting heads count headcount are restructuring, and worrying about capital. Francine a lot of the analysts are saying that they may have to raise more capital and 12 months. Saidis something that he when not be true but i feel as always quite realistic. He said if the tent trend continues, there is no geopolitical shock or risk their fine in terms of Capital Raising. He was also at pains to tell me this was part of the plan. They always wanted to reach this amount of Capital Raising level. Swissends on the [inaudible] our go straight to the capital market. Guy the last year, Credit Suisse was a big underperformer. Do you get any sense that he feels he can close that gap because investors are a ticking clock here. Francine yes, that is a good point. He is targeting the share price again, he has always told me that the share price if it were going up a lot more, it would make his life a lot easier. If you look at the share price and he sometimes comes in and interviews with his share price the last 12 months, it was at a record low last year and he has brought it up. This is probably a personal victory for him. Guy the rest of the Banking Sector has gone up a little bit more. Francine lacqua speaking to the Credit Suisse ceo. Fantastic interview, always a pleasure to hear what he has to say. Useful insights into what is going on. We are minutes way from the european open. We will take a look at what [inaudible] are doing. Watch, keringk to sharply higher. The open seven minutes away. Matt we are minutes away from the open. Lets get some of the stocks you need to be watching this morning starting with kering. They own brands including gucci. Sales growth is surging. First quarter revenue exceeding analyst estimates. Because of sales of gucci and you said laurent yves saint laurent. I know so much about these luxury brands. Geico on that talk about santander. Credit suisse has been an interesting exercise, fascinating to watch. Santander has been a paradigm of stability in so many ways. The brazilian real helping out, the u. K. Economy and the fact that has not cratered yet. Data are flowing. The numbers are good. Is sharply higher. The opening is next. Guy let us have about where we are going to go today. To be honest, youre not going to get the kind of momentum you had over the last few days. Plenty of things happening. Look at what is going on in the states for the trump plan. We are going to Pay Attention to that. Nevertheless, stocks continue to move higher. That is what we are anticipating. We are not up by much, but we are up by a little bit. You have seen what happens. Higher. Nding i think it is significant. As close as we are, from those records in the united states. Matt. Matt investors piling into the dollar out of this tax plan, so keep your eye on it. Any currency that have gained a lot into this runup. Here is the euro. Over the last three months, the euro has done quite well. I left this chart wider because it shows you the gap higher monday and the super surge we have seen since then. Dollar,y in the something worth paying attention to. The ftse openings offer this morning. No clear sense of direction either way. We are not going anywhere in a hurry right now. We need a new context of that big rally. We have seen some reason to sell. Momentum indicated in the states is positive right now. Something to Pay Attention to. Money is flowing into european equities fairly aggressively. Such a big move. People are going to take a look at what is going on in more detail. That is the open. We are softer in london. Here is manus cranny. Manus very good data do you o you. Look at euro yen. 4 rally in three days. Look at eurodollar as well. A little bit less. The real momentum is in euroyen. European stocks this morning, just a tad lower. Keep a tab on Credit Suisse. What it trees going for the Credit Suisse going for the r rating. The jewel in the crown so to speak. There is the first flash on Credit Suisse, down. Who will be the supporters of it . Im sure hes done his fieldwork before he went for that particular announcement. This is the flow you were talking about, guy. The biggest inflows into europe. Europe is up by 7 on the euro. The s p 500 up. What could unseat the momentum in the equity market rally . One is trump from a global perspective in terms every touch edition. Overseas currencies. Impact . T really have an second is the ecb. That they be shifted from their rhetoric stands at the moment . Let us have a look at the momentum. If you are wondering whether the this is ae 1999, perspective for you. Theres the bandwidth at the moment. Inhere near what it was back 1999. Less thanentum technology on the upside . The shanghai composite closes for the day. Im sure you do not want to see my little chart. As to who im talking to, what we are talking about. There you go. The shanghai composite closes. A nice rally turning around. That is going to be good news. What are the chinese doing . Taking their money outside the country, building up dollars. You begin to understand. Se strengthening their checks. Again, you are seeing the chinese buildup their port of dollars. Of dollars. De if you cannot get it out of the country, lock it up in a bank near you. Guy. Guy thank you very much indeed. Those are some of the details. Let us take a look at some of the individual movers and what has been going on this morning. This is the stoxx 600 breakdown. Here is the downside. This is a lock maker. I want to point out a couple of things through this stock is no up on the month by 6 . It is down by 2. 89 after the 2. 89 drop. This is set up as an trade nestle with a break this morning. Today cks go ask the three stocks go xd today. Just Pay Attention to that when you are thinking about how to market is going to perform over the next 2448 hours. On the upside, the real highlight for me is santander once again really delivering that stability. By theain being rewarded market. Santander up by 1. 08 , just providing clarity on what is happening next. It is the stability story, what is helping. Lvmh continues to remain well bit as well. Thanking sector in more detail. Credit suisse and santander beating their First Quarter earnings this morning. Here is how it opened up. Softer. It is going to have a Capital Raise. We also get a standard chart a result of little bit later on this morning. Joining us on set to discuss all of this, bloomberg banks editor chiefl moore and a Investment Officer at cross bridge capital. Let us get with the details. I want to start a little bit with cf. Let me just show you a chart, cf versus the european banks. This is taking you back to the beginning of the 10 year tenure. On the way up, lagging and quite a lot. Does todays news start to close that gap . Is that enough . Reason for the gap was pricing in some sort of Capital Raise, be it through selling the swiss bank, which they have decided not to do, or through a share sale, as we are seeing today. Over the last few months, investors have started to price that in. That could kind of set Credit Suisse up to have this question behind them and really go forward more on the earnings story rather than a capital story. Cuts, i think, 1400 jobs in the First Quarter and