Minutes. Thank you. Gaining two percent. Peter long purchased this morning. Arecord operating profits dividend to shareholders. Quite nicely. Up 30 this year. Will talk about that. About the french. Well go to Caroline Hyde who is in paris. I have been speaking with the president of paypal. Talking about how the company is revolutionizing how we shop. When no longer need cash or cards. You will need your smart phone in your pocket. Theill be talking about future investing in startups especially in france. An asset manager. Crucially speaking to microsoft as well about cloud computing. That is coming up past 10 00 london time. Thank you so much. Corporate news. We are watching that great interview with mark carney. China is in focus today. It trailed estimates. Auto sales beat. Overall, the robustness of the metadata. Fascinating, three federal chiefs are speaking. And laborout tapering gains. Fischer from dallas saying the need to taper not at that. Highs. Uities at mark carney on his focus for easing. N terms of Interest Rates really running the risk of premature withdrawals of stimulus as johnny said. China data, disappointing. European equities, a little softer. In terms of Industrial Production here in france, you saw a decline in terms of industrial numbers. The manufacturing numbers were better. The details. Any reflection on the chinese data. It is. The map has shifted. On on the down side. Rio all a declining. It could be at the start of trade in terms of what is driving the market. In terms of where to go question mark where did it go . Cutting jobs. Fairly nonreaction. Eight. Lloyds selling another of st. James place. 625. No really reaction there. The equity markets are lower. A gain on that news. A gain on eads. Lower. Ecord profits if your shareholder, that is quite nice. Well talk about the prop the problem even though egypt is open. Just drifting a little but lower as a london comes in from the session. Of theo to the rest production numbers from the u. K. As the morning goes on. Generally, the dollar is lower. Albeit, a tiny. Trading a little but lower on dollar index. Back to you. Thank you. O ons head over to jon ferr mark carney. What he had to say about the Housing Market in the u. K. . Absolutely. The Biggest Issue and our country. Housing. If you have a house, and the value of your house. If you do not able to get your foot like many people. This is what mark carney had to say to charlie rose in an exclusive interview. If you look at the Mortgage Rate today appear to precrisis, it is rocksolid. Back in 2007 at that point, 60 of the mortgages, you could less than 10 down. You had to put a lot more down. Standards have improved dramatically. This is a Housing Market. It is firmly value. Not just in london. Relative to incomes. And with and relative to historic levels. Within the context of households. It paid down about 30 Percentage Points of debt relative to the last five years. That is good. A from out of debt. More in fact that american households. You look at that situation and say, there is welcome recovery butthe u. K. Housing market, lets be prudent. Lets act early and it sure it continues to evolve a constructive ways. We at the bank of england have taken steps. Five simple words describe our approach we are open for business. Thats a different issue. [laughter] we leave others to that. Rocksolidtgage is compared to precrisis. A hard comparison to make. It probably is not. He could be a little bit concerned not only about the Housing Market but to the wider economy. That is the key point. A man worried about a provincial withdrawal of stimulus and the risk that may fall into his hands. You have to raise rates if he goes out of hand. That is an issue for him. That is why he wants more mortgage leading. Aboutnot overly concerned the house in the risks and a way that amplified by his concern about not raising rates too soon. That is mark aris message. Carneys message. You can catch the full interview on charlie rose. They look a look on what else is coming off. More on the job cuts. Boomoth the latest numbers. Ups said ism that better than google maps. We are on the move. s i am francine lacqua. This is on the move. Our next guest thinks there is good value and equities in health care and financial stocks. For more on that and her outlook, lets welcome lucy make donald. Mac donald. Great to have your the program as always. What is the difference in 2014 . Some of the groups you Like Health Care and technology. Technology has not been a great area this year apart from some like social networking being very strong. Broadly, it is not been one of the leading groups. Going into next year you can see some of the Larger Companies like an apple needing to recover and microsoft going to a new phase of recovery. That will make the sector will cover broadly. That is an area where you can still see absolute values and a market that has been difficult to find. That second area that has been interesting next year for Different Reasons is industrials. Because as mark carney said, we really need to see the coming through. The big guns to come through. We need to see it come through. For companies that we saw in the last few months, we are seeing glimmers of hope. In that area. We particularly like automation, energy efficiency. And some areas of aerospace as well stop the niche. We are beginning to see some pickup of the top line. Go back to technology. I am looking at all the Technology Companies. You like microsoft. It is a company being overshadowed. Is there somebody like to see at the top . We are watching it very intently. Unique to see somebody in place before we really make a decision. We are invested a but until it is a top stop. We want to make sure that we get to the right leader in place. However, looking at what they have done involves a certain amount of work to restructure the company and focuses on the business which is where we think they should be focused on. That has seen growth. And it is very profitable. Happened, was what whoever is in charge. We really want to make sure whoever is in charge. We are speaking later on to be had of microsofts cloud. One of the people considered for the internal job position. Internal or external . Well, it is ae very difficult job to manage. A large organization. Whoever is able to do that needs to clearly be a technology and visionary. Finding that one person might be difficult. You also like amex. Technology company or more financial . We see commies these trying to rebrand themselves. Us they are Technology Companies with the trucks. Areaex is an interesting between the financials and technology. That is digital. All very interesting. Going into the next couple of years, that is growing very quickly. We let the processing photo amex is also, in travel related consumer place. I think it is in many areas, we see growth in the next year. What about eads . They have seen recovery. We like travel. We prefer online travel. Business is tour quite competitive. They have a very strong position within it. We like the overall industry. We think their part is competitive. We prefer to the enterprise aligned. We think it is better for the country. Thank you. We will be talking about defense. And eads plans to cut 6000 jobs. Steepest cuts in five years. They are combining defense and security. The very latest. Will the restructure be enough to ease concerns about agenda link defense spending . You can see theres been a reaction and the share prices. Up a little bit in a following the market. That will be very interesting question to put to lucy who was talking about looking at some of the defense and aerospace areas in terms of investing. One of the things that is happening if it does appear that eads is really going to refocus the business on airbus and aircraft business. They had plans to ease the businesses out. Other Defense Space would represent the other half. Since the failure of the merger that was blked that wouldve been able to help them with their defense business given the fact that the systems as such a Strong Player and in the United States and saudi arabia. It really does look as if all focus is going to take place and now on the airbus business. Continue to grow. Airlines are having to get rid of older fleets. As for the share prices, it is going up for the year. Eads up 71 . Not a bad performance. Thank you so much. Lets get back to lucy macdonald. You like defense, but not in this kind of area. Aerospace, not so much and defense. Defense spending will continue to attract in this year. Area where many of our clients have ethical issues with investing. For us, we need to have a really good reason to be there. However, civil aerospace, we think is quite are a good growth. You prefer suppliers . Would prefer suppliers. We like utx. Smaller companies. That is aereo. A little boat a little bit more nichey. The whole area has been strong. What of your favorite picks or not . Yes, we still like it. Talk to me about financial. 2014 is what we get the quality review. Are the concerns will see liquidity crunch or will we raise more capital . Are you confident that we see growth in europe, financials is the place to be . I think we are seeing progress toward getting to a safer place. That is was winning. The asset quality review backstop and capital raising. That is what we need to see. In whichever order. That is what we are going to see. That is was will be waiting for. It is not space yet. Will still be volatile. You want to rethink the quality. However, it is one area. It is difficult to find absolute value in it. That is one area you can still see, theres potential outside especially a europe. You want to have some exposure there and as we go through the quality review and capital raising, it raises the valuation. It will become more interesting. Your take on the periphery countries . Can you pick in the periphery countries . Are thereue would be that Many Companies there that you have to take this sovereign risk to be invested in . There are not that many would you look. Coming companies and greece you want to invest in and spain . Maybe two or three. Not that difficult to avoid them. It is different. You are playing a sovereign risk. We are looking for companies that we think a compete globally and provide services and ssl around the world and gotten a good competitor advantage. In many of these countries in europe, there are not that many. Thank you. Donald, up next, tui travel. The latest numbers when we return. Welcome to on the move. I am francine lacqua. These are companies on the move. Nokia is nearing a deal. The company is willing to pay at least 300 Million Euros to allow the shifting of access to microsoft. They were frozen this year in a tax dispute. Siemens is said to be considering a deal of its medical unit. It is not considered to be a core business. The chief executive is evaluating the portfolio of the largest engineering. Novartis is considering swapping Animal Health unit of one with assets rather than selling. Face change is one of several options exploring. Of you several options that are exploring. The allergy medicine is said to be attractive. Announced record profits earlier this morning. Manus is here to break down the numbers. What drove the numbers . The right product and squeezing margins higher. Your speciality products. Unique. They said we interact and wont more. That fills the margins. That is doing better. Also doing quite nicely and the u. K. And nordics. It is where they are beginning to build the margin. If your shareholder, you get a nice up left on the dividend. Ift on the dividend. They are carrying more people in the u. K. And nordics. Hey are building the margin they had a pretty good set of numbers recently. We are seeing margins above 1 . And if it works and they are selling more holidays directly to you on the web and that is really about delivery mechanism and it does not cost them as much. East germany, that is their biggest markets. They sought numbers follow but they boosted their margins overall. That had probably the past, what to do they say . Still economic issues. Egypt, where a lot of french want to go to my that are open for business. They took restructuring charges. They are tackling that. What did say about the way we book . Saidsion like travel she likes travel. We are progressing to that model of everything online. Unique holidays take more interaction. It is investing in peter is going along. Deliver analyst calls. Mobile is a critical issue. Mobile is incredibly important. Some of the smartphones and tablets. Ourre developing all of websites for both mobile and tablets in terms of optimizing them. That is very important because you cannot use the standard size in terms of a pc. We are doing a lot of work. We are seeing a huge demand for these devices are being used rather than pcs. Upbeat. Fairly thank you so much. Well continue to look at technology. That is coming up next. Welcome to on the move. I am francine lacqua. Bloombergs European Headquarters and the london. Your top headlines. European Central Banks review of effectwill have limited on ratings. They will how an time to strengthen capital. According to s p. That will assess the health of over 100 banks and supervise year. N the upcoming german softened its opposition to handle bank for years and in the eu. The finance minister would give the European Commission a role in saving closing banks. He had previously rejected the plan. Agnes ministers are racing to come to an agreement before next week meeting. Bank of England Governor Mark carney weighed in on the Banking System and an interview with charlie rose. As the european situation is vastly improved in terms of risk. The dynamism is not there. The dynamism will not be there or began to appear until the worst of ecb is doing of fixing the Banking System over the course of the next year is completed. You think they can do that . They needed to do that in a fully recognize. Using ke ha the full interview with governor mark carney on charlie you can catch the full interview with governor mark carney on charlie rose later today. Thousands of South Africans are making their way and the life of Nelson Mandela and were expecting many leaders across the world including barack obama and leaders in brazil and india will pay tribute to mandela today at the stadium. With the continue to monitor these pictures will potential monitor these pictures and breaking any news and show you speeches we will continue to monitor these picture and bring you any news and show you speeches. Lessor, chief european economist. Lets welcome chief european economist. It is a relatively calm to say the least. If 2014 going to be more of the same . Tofrom a crisis situation politicization state of situation, we are looking at the effect from stimulation policies that took place this year that were successful in realizing the market. Unfortunately i must the negative side effects. We demand. The biggest challenge for 2014 will be the backdrop and in the banking sector. You talk about too low inflation, are you worried about deflation . The risks in the region we are seeing potentially a very large output gap and rapidly rising that is strong warning. Not acclimated which i am very concerned about. The currency is moving against. We are certainly seeing signs that it is much higher than where it is currently emerging. What you was concerned about ecb units or sovereign bonds will react or banks . A mix of everything here. The other side of the coin of deflation is built into the system. Termss very japanese in of the rebalancing of the economy. To buy domestic bonds. That is the next step. That is where it will be critical if the supervisor let the banks continue to hold more of the sovereign bonds. It will remain. If they present their concerns as we have heard in the last few weeks about concentration risks of sovereign bonds, theres an issue there in terms of how stable the markets can be. The share of foreign buying this been it is not really great. As civilization has, from spain and italy from domestic buying. From spainulation and italy from domestic buying. The Sovereign Bank mixes and in the context, a very important to how the race will be addressed. Talk to me about currency. Is europes too high . Could 2014 be the year when and that ease qe . Expectationsdefied and nicotine to do so. If you look at the eurodollar, stronger growth. Taper around the corner. Not so. You look at the yen and it is moving lower. Clearly, something going on. Or have the expectations of relatively low inflation. Maybe the current account with europe going toward a surplus and boosting the currency. In that as you said, it will push the ecb in another territory. We have seen it. I expect micromanagement measurements to take place. Maybe when i see the qe side of things if the recovery accelerates. Certainly, the pressure will stay for the will stay. What is your take on mark carney in the bank of england . U. K. Is firing on all cylinders. There are firings i had. Its a getting ahead of itself. The speech we got out of carney last night which we started the conference between aboutrnanke and sommers stagnation. He is on the scene which is important on whether we are in the liquidity trap. It would mean the natural rate isinterest, really rate, lower. He is arguing against that and the u. K. , but certainly the fact he is spending so much time on this shows the caution he has about Interest Rate policies. At the same time engaging on the house market to try to save time before lifting Interest Rates. Very tough. Not only Interest Rates over the horizon and the economy actually is quite strong at decisions up jacques, thank you so much. Since the 10 years conference began in paris. What is in store for the next decade . Caroline hyde joins us from this years conference. The tech world is a different place compared to 2003. It was like and becoming more competitive. Francine, think of the maya mental news that happened in terms of te