Rest of 2017 . With Central Banks, shifting into neutral. The sweetest central Swedish Central Bank signaling the end sparkhreeyear effort to inflation. We will get a decision at 8 30 a. M. London time. Cash is about to open. We are half an hour away from the stock start of stock trading. We are getting an idea of where we will start the day and the fair value points to a negative start. 51 . Y. 5 of 1 . I want to move on, we will see what the yens reaction to the news, hes of piece of north koreas missile they launched was an icbm. We will see what the experts have to say. But we have got is the yen down up by. 5 of 1 . Interesting to see how this works its way through the session, looks to be firming against the dollar. The aussie dollar is down, some people had anticipated the rba would follow a more hawkish stance. That has not been the case and the aussies down. Begins strengthening now, continuing to strengthen on the back of this news that north korea said it fired an icbm. The aussie stock market trading higher. Yesterday close to the session with europe. Italy of 2 , the stocks 50, the euro stocks is down. That starty unload we had yesterday. Lets get a bloomberg first word news update. Erroneousin the u. S. , prices of some nasdaq stocks flooded traderss dream screens. Wall street closed early for the fourth of july holiday. The Exchange Operator said the issue was caused right data providers and it was conducting a regular test of its pricing fee leading some providers including bloomberg lp, the parent of Bloomberg News to show exaggerated moves that never occurred. Microsoft said it is working with providers to resolve the issue. Oil has how the gains after the longest winning streak this year. After data showed opecs crude production rose to the level of the highest level in june as members of the cartel boosted output by 260,000 barrels a day. Half of the increase came from libya and meiji era nigeria. Chair janet reserve yellen was hospitalized over the weekend in london for a Minor Infection but she has left and is heading home. She was admitted on friday and released yesterday. She is returning to washington and expects to resume her schedule is planned this week. The chinese president is in russia for talks with president putin. Describing current relations between the countries as the best in history. To a chinese news agency, moscow and beijing oppose the deployment of missiles and agreed to settle the peninsula issues through dialogue. Global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. Is number. Guy lets get back to the north korea story, north korea saying that it fired the missile it fired was a new variant and it was an icbm, capable of being intercontinental. Angle you gethe further down range in terms of the way the ballistic curve works and the implication is they have more range than the 30 plus minutes the rocket fired for. The icbm caused no safety arm for a new bring nations. They may be a slightly different view being taken in some of those neighboring countries right now. Probably a different view in the u. S. Lets get a sense of what is happening here at how much further we are in the story. Asia correspondent Stephen Engle joins us now. What does the announcement, the confirmation that this was an icbm mean for the larger north korea story . Tephen this is potentially a game changer. We have been waiting to see when they were going to develop an icbm. We had heard they developed engines that were capable all of. Eing fitted into icbms it is equipped with a nuclear warhead, and can travel a minimum of 3500 kilometers. This test firing earlier this morning into the sea of japan on the way toward japan with less than 1000 kilometers. The key point was the trajectory as you mentioned and also the altitude. The altitude they are saying pyongyang went as high as 2800 limiters. Columbus ares. That could give a range of 6000 kilometers. Alaska is 5500 or 6000 pyongyang,away from from north korea. Seattle is 8000 kilometers away. The continental u. S. About 10,000. Not necessarily that far yet. Potentially a game changer, something that tim johnson un jongil and kim jong and his generals can beat their chests about. We have seen the tweets from the president of the u. S. , what also we getting . Stephen this is before the confirmation from pyongyang. Trump saying does this guy have anything better to do, maybe a little bit tongueincheek and may be too much levity given the magnitude of this. Perhaps china will put heavy moves on north korea to end this nonsense once and for all. We have heard from the south , saying theyent will urge north korea to stop his provocation. Also shinzo abe said the threat obviously korea, is even this mornings test of the icbm is as gliding. The on the be minds of leaders as they gather for the g20. We do not know what they can still do to rein in north korea. Guy thank you for the update. Stephen engle joining us from hong kong. This ets have ignore ignored this. Tos turn our attention another story. The reserve inc. Of a story has left benchmark Interest Rates low, the at a record decision comes a week after the bank of england, bank of japan at a signaling the time for starting to move in a different direction and hiking rates. Janet yellen has said the finding is on track. In some ways not following through on what we have an seeing from other Central Banks, whether or not there was coordination or not. The rba does not seem to be part of it. Bloomberg reporter james thornhill. James there is little doubt the market was expecting slot a slightly more hawkish tone in line this sort of things we have been hearing from the bank of england and canada. What we got was a neutral statement. Very little changed from the previous statement and the aussie dollar sold off accordingly down. 75 of 1 . There is always a bit of misplaced optimism given the well documented concerned the rba has, they are anxious not to feel that strength in any way and perhaps stall and make a recovery in australia. For 2017, candone we all go home and look at Something Else or is there something that could still may be forced the rbas hand here . More likely they will be on. Old they inserted a line on week growth. Weaker growth and high levels of household debt. Those are the things on the downside that the rba will have its eye on. The analysts who were looking who are isolated in this market, looking for a hike at the next move it not until the first half of next year. One in threeg in chance of a hike by next march and that seems to be the consensus right now. Guy great stuff, thank you very much indeed. James thornhill joining us on the rbas decision. Not really going with the crowd. If you are a bloomberg customer you can watch this show using tv. I urge you to use this function. You can also select a Regional Video stream. You can also go and use this sidebar. A number ofyou with different aspects of what we offer. Breaking news obviously, part and parcel of what we are looking at that there is the up its on the market. Then there is the breakdown of who is on the air and then some of the charts we are using, the functionality that is available. It can pop the charts out into them withberg and use your conversation with clients. Theres a bunch of stuff, the index stuff, gmm, who is on air. This bit of it is really fantastic, and it opens a channel to us so you can let us know what you think of what we are doing. We are missing and what we should be talking about. That is all there on tv. This is better. Macrons vision for france. Addressing a special joint session of parliament calling for a political revolution. We are live in paris with the details next. This is bloomberg. Guy welcome back. We are paying attention to one of these ongoing stories. There is a lot of movements around that. Qatar is a big supplier of gas to the uae and they are saying they will not cut off gas to their gulf neighbor. Look to increase it further down the road. These economic linkages which exist within the gcc remain important despite what is happening in terms of the political story. I suspect the gas is for a much part of parcel of what is happening here and that is an increasing theory doing the rounds. In the gcc. Saying heres juliette saly. Juliette Banco Santander said it still last month to take over Banco Espanol will have little effect for the year. It willest funder said sell 1. 6 4 billion shares at 485 euros each. Executives have told a london court they will plead not guilty to charges they conspired to commit fraud over 2008 hundred and with qatar. They are the most senior u. K. Inc. Executives to Face Criminal Charges ends the financial crisis. Case relates to fees and loans barkley made available to qatar in a deal that raised 12 the and pounds. The head of the Italian Banking Association said the liquidation recapitalizingnd monte paschi was a turning point. They also discussed consolidation. Will probably end up less groups0 banks or banking active in italy. And the consolidation of the sector is already in place. We cannot assume additional consolidation. Consolidation at the european level could be welcome. That is your Bloomberg Business flash. Guy the french president Emmanuel Macron is working to place his country in the age of enlightenment. Rebuilding the spirit of ambition across europe. A two france to take initiative and i want to do it. In the month to come thanks to the close relationship i have established in particular with the german chancellor, before the end of the year, everywhere in europe we will launch to credit attendant conventions conventions toc unite people. New age of enlightenment. He is raising the bar. Caroline, the highlights, he is talking about a new age of and heent thought is raising expectations. It is about the vision of france. He talked about the new humanist project revolution that would restore confidence from the french people. Its mounts in announcements on the Institution Side area he gathered his 900 mps and versailles telling them he will cut their numbers by one third. He also wants to introduce representation in parliament instead of the system we are seeing now, something that could give a lot of votes to parties including the national far right party of marine le pen. One more announcement, he is going to end the state of emergency that france has been living in since the terrorist attack in 2015 by the end of the year. That hisinly intellectual and philosophical vision of france. Guy why did he choose to deliver the speech the way he did and in the location . This is a big step up in terms of no more protocol. Caroline yes, and the u. S. You have the state of the union every year and this is kind of the model that macron is trying to follow. The congress does not meet frequently only to revise the constitution. Sarkozy did itt once in 2009 at the height of the financial crisis and france hollande france will did it. He went to show he can also use the congress to reinforce his powers, reinforce the image of a powerful president. That means there are some dangers to this. For example, the far left wing decided not to attend this congress. Press who was talking about macron as a jupiter, the king of gods, also parent comparing him to the sun king, with the monarch who may moved to versailles in the 17th century. Guy thank you. I want to recap what has been happening. North korea saying that it has missile with aa significant increase in range capable of hitting targets significantly further away. Lets show you what the Exchange Market reaction has been. A little bit of volatility surrounding that event. This is something that is coming from one source which is north korea. I suspect there are Rocket Scientist who are going over what this looks like, though launch angle, etc. , trying to produce what the capability of this device is. Well continue to monitor it and bring you the latest news and we will leave you with a live shot of new york my it is independence day, u. S. Markets are closed. Atwill be sunday of things plenty of things to look at stateside including the boston pops. The market is closed. The open is seven minutes away. This is bloomberg. Guy a few minutes to go until cash opens. The u. S. Is closed for the holiday. U. S. Investors concerned that the huntsman transaction which clarence is trying to push through under valance clariant. Es of some of the activists. The top line looks i get is looks like it is delivering nicely. It does seem to be taking the idea that you could push prices through consumer a little harder and further. This topline story which speaks to that area the other stock to mention is santander is talking about its recent acquisition. It was part of the bank rescue. It does not think that will have a meaningful impact on its numbers going forward. That stock has had quite a run. The market is about to open. We think it will be a negative start down i. 501 . This is bloomberg. Guy catches about to open, but the u. S. Is closed. On the fair value calculations around the world at the moment, bloomberg points to around a halfpoint drop. We are expecting maybe a little fade off, but not a big one. In some ways, todays session is a nonevent with the u. S. Out. In terms of stocks to Pay Attention to, keep an eye on. Larion, santander markets drop a little at the getgo. To figure out what some of the big events over the last few days actually mean in terms of Central Banks and the clearrd not giving us a steer on that. Lets see how markets are opening. We expect open down by around. 5 , the picture we will be seeing. London. London may do a little better, but not by that much. London down by. 3 . I expect the cac will open a little softer than that when they come through in just a second. Keep an eye on clarion. Down third gilts are open, what else do we need to know . The same global issue to deal with. Yes, a slow gradual recovery but they dont see it in Wage Inflation. Centralresettings of bank rhetoric, are you getting ready for one of the biggest policy missteps we have ever seen . By. 5 despite the fact ubs is overhauling the european operation. Deutsche bank expanding for the spanish operation. The markets are lower decidedly because of geopolitics and the Missile Launch from north korea. It was a ballistic missile. Technology stocks have pressure in the asian session. Financials down by. 5 . Industrials down by. 4 . We need a war or a recession to remove us from this bandwidth in low volatility in markets. Market, the German Government bonds market, what is the reality that happened there . Open interest crashed. Interest crashed to 100,000 contracts in three days. You are seeing an aggressive restructuring of derivatives market. Story, note, look at the of writer quotes it 95 global duration derivatives are probably losing money. The u. S. Bond market is out for the fourth of july. Market put on 23 basis points last week. We will see what happens as the fiscal levers may have to deliver more latitude and leniency. That is the debate in the fiscal space. Im off to digital radio. Guy enjoy yourself, manus cranny. This is your move screen, mov. Anglo softer this morning, rio is off, glencore trading softer. If i make this an index point story, it is down by 1. 33 , as well. Hbc softening from yesterday. Happening you what is for an index point of view, crh, the clarion story popping to the top. Clarion is trading higher on the back of act vests saying maybe its deal with huntsman undervalues the structure of the ratios undervalues the clarion stock and we think it may rethink the whole business going forward. Up nearly 4 on the back of that. Its talk about what else is going on. Lets talk a little bit about the bond market. Yields, ino, 10 year u. S. , germany, the u. K. , you can see this chart going here. That is no longer the case. As Central Banks think about normalizing policy lets debate that premise as well will they do that . Should these yields converge . Which one of these is wrong . The convergence coming through here and the divergence happening here. Clear, separate line. Germany white, u. S. Blue, u. K. Yellow and china in the purple. With us on set, the senior independent class advisor. Mark cudmore is the author of that chart. He is an mliv macro strategist and joins us. Were nearly a week on from Central Banks coming through and appearing to coordinate policy. The question is, are we going to see a significant reconversions of these lines. Faulk, i will start with you. Are any of those lines wrong . Marks line is that we dont say all of the mark. I could argue they are all wrong. Is any longer than the other more wrong . We will say. The four bond markets you described, we have some issues at play as well. U. K. Has a separate brexit story. China seems to be a different part of the cycle. Wehink the u. S. Yields are still trying to find out if the fed is making a mistake or not. Inope last week, way back 2008, idiots like me said if you start qe, how do you get out . Draghi, in one day, we saw the confusion. I meant that, no i didnt mean that. I think we will have to get used to that. Guy mark, is that a satisfactory answer . Certainly f all, i sympathize with the fact that you eu will be hard to unwind and i stand in the camp that i dont think any of these Central Banks will significantly unwind their Balance Sheets. They will start the process or grow slowly, but i will be interested if bob thinks bund yields are so much lower than treasury yields. Growth, avery good slightly different story but the u. S. And european fundamentals are converging rapidly. And the asset prices are converging when it comes to bond. I wonder why he thinks the european bond yields are so low when it comes to german ones . Bob i think there is some element of a safe haven of belief in germany. Hat reflects there is an other element that reflects that perhaps structurally, a belief that the eurozone is a low growth area and a low nominal gdp area. I dont know if that is true, but these things are flowing through. In the u. S. , part of the repricing of the bond market reflects that there is this a jewel fiscal tax reform hope which ultimately should lead to more supply, which