Italy german spread, all narrowed. Some of the biggest moves we have seen in the market. Convergence is absolutely clear. Lets see what the detail is in terms of what is happening with the greeks. The greeks are going to receive a little more liquidity in terms of emergency funding. 10 points or 11 points coming off the london market today. Dividend housing Marks Spencers doing a little better. In london equity markets are opening a little higher despite china seeing a slowdown in manufacturing numbers. Lets get to some individual stories we are keeping an eye on. Deutsche bank is said to be nearing a 2 billion euros settlement. Ubs said 1. 5 billion in settlement. That was their record. Some companies had 6. 5 billion dollars. Will they settle with regulators . Stock up 1. 4 5 . I suppose the issue is to get big litigation out of the way and crackdown on reorganizing your bank. They had a sales number at novartis that was interesting. Operating numbers will be ahead of what they were originally. The stock up 2. 2 percent. We are waiting for ericsson to open their margins. They took a 600 million kroner restructuring charge. Mobile youre going to see a little softness. They got competitive in terms of alcatel and no kia nokia coming together. These are three eyes three things to keep an eye on. 75, 55 is where it trades on the downside. The Central Bank Says there is room to remain in this lower band of rates. They may have room to cut rates. That is where you see the big move. The new Zealand Dollar down 1. 5 . Back to you. Thank you very much. Three minutes into the open. The ftse 100 a little bit firmer. The dax is higher by 47 points in frankfurt. Some data out of france. Im getting used to saying this. The pmis come in. Manufacturing in contraction at 48. 4. Services coming in at 50. 8. The composition pmi coming in just an inch above expansion territory at 50. 2. A little later we will get a reading on german manufacturing. We will get the same reading for the eurozone as a whole and the u. S. At two 40 5 p. M. We will bring you those numbers as they cross. Pmi data across the planet, we had some readings of manufacturing activity. Both missed estimates. Shanghai composition on a skyward trajectory despite the data. It is up more than 110 . Lets begin with the data. We are joined by brian from tokyo. Lets kick it off with china. This pmi figure is not very reassuring about the direction of the chinese economy, is it . Brian no the chinese economy is decelerating. What was disturbance disturbing is the weakness. That is part of the larger goal to wean china out of debt fueled investment led growth, and it is really being felt at the economic level. Jonathan we get excited about what the peoples bank of china does. We know the bank of japan gets very busy. I am looking at japanese manufacturing slipping into contraction. What are the details, and what can policymakers do . Brian the manufacturing weakness is centered on domestic Japanese Companies that arent getting a big currency boost like the Big International exporters. That plus a week consumer economy has cap japan in the slow growth mode. Kept japan in a slow growth mode. Whether they are going to dip deeper into a more intensive qe program or try other things to get the economy moving again. Jonathan i think there will be a temptation to look at these data points and talk about a regional slowdown. Is that a step too far . Is this a real domestic story for china and japan that they have their own problems internally . I think so. In china you have Economic Policy makers at war with themselves. They want to slow things down shift from debt fueled investment to a more balanced growth pattern. They are afraid of going below 7 . Japan is calling out of deflationary environment and a recent recession, and they are very particular issues on both sides. Jonathan a big thanks for joining us. Lets get the investors take. We are joined by the chairman of the investment committee. Stephen, great to have you with us. We cant talk about china without talking about the chinese equity markets. Forget the data. Its only a bubble if you have not got a position in a bull market. Whats your position on china . Everything is a bubble because it is all about Monetary Policy. That has confounded pessimists that when you have aggressive easing and things like reserve requirements then you change the game. That is what has happened in china. Its hard to see that changing. For china specifically, when you see a weak data point everyone gets excited, and they say what is the bank of china going to do next . We know there is putting more space to cut the rate. At the same time bad loans nonperforming loans. How much space is there to get aggressive with rates . Its a tradeoff, isnt it . I think there will be more easy money to come. We have seen from the figures overnight that the fundamentals are deteriorating rapidly. Its going to be a tough one, hard for investors on the other side of the world to see a lot of clarity. The lag time of what the peoples bank of china have done, when do you brian expect to see that . Typically, Monetary Policy has a lag. We have started easing the back end of last year. It probably wont be until 2016 that we see some sort of pick up. You have some savvy investors who are saying where you play this is looking at some commodity resource stocks that would be absolute trash. This is a perverse situation. The chinese stock market has doubled, yet all those companies that do business with china have been absolutely trashed. There is an argument that if you see a genuine pick up in Chinese Business activity next year and maybe sometime this year, there are good Access Points being incredibly low prices. Jonathan do you agree . I do. Longterm investing is about understanding markets are volatile and there are opportunities for entry and exit. The commodity super cycle story which a lot of people believed in, has unfortunately exploded. A lot of people lost their money on that. Maybe the emerging markets story in china is the ultimate story. It will come back at some stage. Jonathan the debt overhang is pretty much present. You have seen a dollar dominated bond in china and a default in china. Do you expect more of that to come . Some people think this is a good thing, a little discipline. We shouldnt be strangers to debt defaults. Overhangs of substantial depth debts are not exclusive to china. We have seen when monetary authorities are sufficiently robust as they had been in europe then Monetary Policy does work. For investors taking longerterm views, perhaps they may have missed the shanghai move. Perhaps the way to trade that was with commodity stocks. Jonathan coming up facebook does not like the dollar. We will talk about that. And it is another multibilliondollar settlement on the horizon for big banking . Just maybe. We will talk about that a little later. The ftse 100 higher. A big move on u. K. Stocks. Another inversion deal. I will try to bring you more details later on the show. We are back in two. Jonathan u. S. Companies lets talk about them. Facebook and ebay cited as a cause for concern. Those sales hit by a stronger dollar, so much that facebook missed analyst estimates. We are seeing many of the exporters in the u. S. For the First Time Since 2012 growth missed forecast. Sales up 42 . It could have been 49 growth if you strip out the effect of the stronger dollar. Clearly it did have a significant impact. If you are looking at the numbers, they were pretty stellar overall. We were seeing Strong Revenue sales. We see a significant uptick. Quality, reach, this is what they are seeing in advertising. Mobile makes up three quarters of their advertising business. We all want to be on facebook on our phones. The Company Wants to target us the a are smart phones as well. 4 billion videos are watched per day on facebook. We are all logging on more. We are seeing 1. 4 4 billion of us have a facebook account across the world. Nearly one million of us are looking at it every single day. User growth advertising growth, and they are hiring like crazy. Cap increased their headcount 48 in the last 12 months. Cap have more than 10,000 working for them across the board. It seems people are more worried perhaps about the stronger dollar. The most important thing is boosting underlying business. Many are convinced by Mark Zuckerbergs vision for the future. Ebays future is one to be worked out. They beat analyst estimates. Sales, profit both grow despite the stronger dollar. We did see growth for both, even though we saw a loss. Cutting growth, thats why they are able to reinflate profit. In two 2400 jobs went. Investor splitting themselves up. The smooth separation of the paypal unit from the Online Market will occur in the third quarter. That is clarity. Everyone wants to know when that might happen. Shareholders have had them under such a strain saying we want to do splits apart. There is more value in new separated. There is a fight for ebay going forward. Paypal is bigger than ebay. Paypal brings in more revenue in the quarter, so when they part ways, what then for the value of the marketplace . How does it cut back the presence of all the other retailers going online . What can it do to lure us back . Jonathan Stephen Isaacs is still with us. He is the chairman of the investment committee. The underlying numbers at facebook, the dollar takes a bite out of sales. You look at the move, and it is trading up 43 times estimated earnings. How do you play these stocks . This isnt exactly a cheap stock. You have the fact that Mark Zuckerbergs shareholders are a secondclass, and they are hiring like crazy. They are out of control. It looks i get fantastic stock. If you buy here, you need a huge amount to buy here. They are picking winners. This is a detailed game where you need absolute stockpicking skills. Thats a skill some people have. Jonathan the market is dominated by huge macro top down. Now we are talking about the u. K. Situation as well. I have asked people about the u. K. Situation. They tell me and matters, but no one has told me how to play it. Can you invest around it . Stephen i dont think so. The market didnt move. Its only over several years that you get the impact of less business friendly politics. I think thats arguably the case now. I happen to believe miliband will win. I think the polls are right. I dont think he will win the majority but they will form the next government. Jonathan why unfortunately . Stephen from a business point of view, higher taxes, greater regulation, discouragement, all of those are going to reduce the talent pool and make entrepreneurs less excited about investing in the u. K. Jonathan is it possible that labour came and spend, spend spend and created a little bit of an economic boom in this country . You are talking about the end of austerity. That is why it is dangerous to play this. This is negative for sterling. It is a binary view. The tailwind of some of the measures the tories took an office will still be there, much as when tony blair came in. He had a fantastic tailwind that lasted almost 10 years. You already talk about longer terms of productivity, the speed limit of the economy i think will be changed with the new administration. Jonathan thank you very much for joining us. Still to come we will get the latest dealers of the trader accused of participating in the 2010 flash crash. More on that after the break. Jonathan good morning, and welcome back. 23 minutes into the open. Here in london, a huge stock move. Up 35 . The British Company being bought up by arris group. It is a small deal compared to some we have seen but it matters because they are incorporating into the u. K. To try to save taxes. Its an inversion deal. We havent talked about them in a while. You thought they would stop. They have not. I will bring you more details. The british trader contributing to the flash crash. Conditions of the veil include that he sleeps at his parents theyll his parents home. What else to we know about his parents conditions . Its not clear that he has posted it yet. One condition is that he ponies up about 5 million pounds. That is the exact amount he has in one of his trading accounts. His lawyer says he has that money, but its not clear the court was able to confirm transfer of funds. There are a lot of interesting conditions of this bail. One is that he forfeits his passport. He has to be at the family home between the hours of 11 p. M. And 4 a. M. He has to be sharing the home with his parents. One of the conditions one condition is he is not able to interact with the internet at all. The next big hearing will be in august where he is going to say, i want to stay here in the u. K. Back to you. Thank you very much. The best line i have heard is it is like trying to pinpoint a land ranger. I dont doubt that people try by leveraging, which you can do. I think the hope is you might in theory be able to influence the market. You are talking about the worlds most liquid stock market. I think its a fantasy to suggest one day this man was the cause of it. Its about making an example. I think they will probably extradite. Its very sad for him but there you go. Coming up we are just minutes away from german manufacturing data. That is three minutes away. Will germany deliver . Find out after the break. Jonathan good morning and welcome back. We are in bloombergs european headquarters. Lets get to that data out of germany. German manufacturing coming in at 51. 9. That is a miss. Services pmi comes in at 54. 4. That is a miss. The composite comes in at 54. 2. That is also a miss. We were looking for 55. 6. Lets bring you up eurodollar. We had a miss across the board for french pmi data. The Services Number a miss. The come positive a miss as well. We are seeing a similar story in germany. Eurodollar just missed session lows. Lets get some more detail on the german pmi number. Hans nichols in berlin. Usually germany is the one that outperforms. This data is not so good. Hans surprisingly, theres a miss on the manufacturing. The manufacturing miss was the greatest of all three. It is manufacturing we expect to be stronger because of quantitative easing. In the last 34 weeks, weve had mixed economic numbers out of germany. There has been concern about the slowdown in greece. For the most part, the view was the German Economy would be able to withstand that. On tuesday, you had the new gdp figures updated from 1. 5 to 1. 9 . The other data is troubling. Earlier in the week, we got the eew number the z. E. W. Number. That was disappointing. A lot of attention is going to be paid to that number. Jonathan data disappointing. I imagine the railways disappointed of you people this morning. What is going on . Hans weve got a 23day strike. The passenger strike is going on until the end of the night. Huge, massive lines all throughout german rail stations. The local news have been playing it all morning. About two thirds of longdistance trains in germany are running. They will likely return to the negotiating table tomorrow. They seem to be at loggerheads. A lot of trains were canceled. Some people were taking the bus. Some local stations reported that bus fares went from eight euros up to 16 or 21 euros. You can still get around, it is just going to cost you more on the bus. The commute times are a lot longer. That will affect productivity. The freight side of this story could affect the economy. Jonathan hans nichols, a man who does not take public transport. He is chauffeur driven. Thank you very much. Lets take you from berlin to frankfurt. Deutsche bank is poised to settle u. K. And u. S. Investigations into benchmark interest rates. According to someone familiar with the matter, it will run the bank about 2 billion euros. For more, lets get over to shane in frankfurt. How does that figure compare with georgia banks with deutsche banks total Legal Provisions . Shane we know what they set aside last year. About 3. 2 billion euros for total litigation. They say they are expecting costs about 1. 5 billion. That is roughly half of what they set aside. What we dont know is what the 3. 2 billion is for and what the 1. 5 billion is for. Weve heard that a libor settlement could come as early as today. Most people are assuming the vast majority of the 1. 5 billion they are expecting will be for libor. We cant really know that. So many other things are also open at deutsche bank. They have investigations into forex dealings, assetbacked securities alleged u. S. Sanctions violations and so forth area it is still open. It is a decent legal cost in the first quarter. Jonathan busy because they are in the middle of a strategy review. What does the timing of the settlement mean if we get it eminently given the bank is in the middle of this review . Shane for management, they kind of want to get this out of the way. Investors and analysts are saying the same thing. Weve heard that tomorrow the Supervisory Board can meet and look at the options presented by management. Next week, they are presenting firstquarter earnings. If they get a libor settlement today or as soon as possible they could get this off the table, go to the board, present their new strategy boost profitability at the bank, and put down some solid numbers next week and the situation could look very different. The timing is important here. Jonathan shane, thanks for joining us this morning. If we get the details, we will bring them to you here on bloomberg tv. Busy morning of economic data. We had a miss on french and german manufacturing this morning. Numbers for the eurozone just a little later today. Still to come, we talk novartis, the worlds biggest Pharma Company reporting results that beat expectations. Could it have the most to lose . We will discuss that after the break. Jonathan welcome back. This is on the move. We are at session lows on the dax. The ftse 100 is up by 0. 05 . So many stocks to talk about. Caroline ive got one big mover for you in germany. It is goldfinger. It was once germanys secondbiggest builder. It is an Engineering Services company. It is down 14 . Ubs says they called it earlier. They said it is going to fall below 50 euros. Down it goes. Major profit warning is what analysts are saying. They are saying that profit will be below last years. Weaknesses in oil and gas hitting them. They made the new appointment of a chief executive, bu