Announces and 800 million euro Share Buyback program. It expects fullyear profit at the upper end of its forecast. Guy another busy day, another interesting week in prospect. Lots of corporate reporting numbers this morning. Lots of Macro Economic news as well. Lets get the bloomberg first alert news with Caroline Hyde. Caroline chinas official factory gate signaled a record six month in a row of contraction. The official Services Index also fell while a private pmi survey signaled the industry shrank for its 11th straight month. Slumps in the wake of the chinese data. Nigeria boost production for opec. Leftesident donald tusk the meeting with David Cameron late last night, saying there is no deal yet. The pair have instead agreed to postpone by 24 hours the publication for a template of a compromise plan. Hsbc will impose a hiring and pay freeze this year. Ceo Stuart Gulliver outlined a threeyear plan to pare back a sprawling Global Network by eliminating jobs. That is as he pushes to improve earnings. Back to you. Uy thank you very much indeed we are 27 minutes away from the European Equity market open. Fairly mixed. Asia was fairly mixed as well. Shanghai down, took up tokyo up. Paris is negative and the dax is rarely flat at this stage. U. S. Futures looking negative as well. A fresh record low yield. Jonathan not just in germany, but in japan as well. The japanese 10year yield, a yield of six basis points this morning. All time low. Silly in thetting bond market. The copper price down by 1 this morning. Manufacturing in china sliding to a threeyear low on the pmi reading overnight. The euro in a really tight range. Guy payrolls friday. It will be interesting to see how that plays out. We will think about that one. Central banks, despite the fact that we have no major meetings in february, are going to be front and center. First europe, now in japan. The negative Interest Rate that has sently the japanese curve towards record lows. The 10year is very close to a negative rate. Nearly half are now negative. Compare that to germany. 70 of the sovereign bonds are now negative. It has impact not only on Central Banks, investors, banks as well. Hearing from the ceo of julius baer. We will get that interview cut, spliced, and diced. Talk to gabriel. He says negative rates are here to stay. Do we understand the implications of that if that is the case . Not really. Us totoo new to allow gauge what it means. A couple of years ago, everybody knew that Interest Rates cannot go negative. If they go negative, they could not go more than. 5 because everyone goes into cash. Cash. Is no rush to negative Interest Rates should spur banks to lend so that they or requiredies reserves. That is not happening. We do know that negative Interest Rates work on the currency. That almost certainly is what the bank of japan is taking about is thinking about. Possibly combined with we have to do something. This is something. We have to do that. That was a long answer. The short answer is we do not know exactly how it plays out. Jonathan do we Start Talking about the cost of storage . It is not even that. The cost of storage is important. Remember, the cost of storage is relevant for banks if they were to move into cash. Bloomberg is not going to move into cash and suddenly Start Holding millions of dollars, euros, yen in its different offices all around the world because the costs would be prohibitive. There are things you cannot do with cash. You can go down and buy a pint of milk. If you buy a maserati and pay in cash, you would happily have someone asking, where did you get this money . It is not just the cost of storage. It is a convenience. It is the security. I am beginning to think that the rush for cash is a red herring. We might see a rush into other assets that we think are likely to keep their value. Chart of the bank notes in circulation in the eurozone and it has gone up. Probably a red herring. This is a chart that has been inclining for quite sometime time. In terms of how you should ,nvest assets at the moment what do negative rates mean . Do they mean that you hold more physical cash . Do you hold more cash in your assets . It has meant that plenty of people have decided to buy relatively low risk, high quality equities. That is one of the implications the authorities hoped would be achieved. We need a significant distinction between the climate in the eurozone and what is going on in japan. Japan, there is an absence of demand tomorrow. A negative rate is not going to achieve anything. We do not have businesses that want to borrow. In europe, negative Interest Rates will drive borrowing because Consumer Sentiment is on the rise. Gabriel, jump in, please. Gabriel i would agree with you. But in the eurozone, the acceleration in the growth of wrought money, which is more important than credit, but also in the growth of credit, started well before they cut interest inus. Could minus to m they accelerated the broader credit growth in the eurozone and credit growth is still weak. James but it began in april 2014. The quantitative easing started in march of last year and the negative Interest Rates were june of last year. It would help a little bit, but it is adding a tailwind. I still think the impact is likely on the currency. We talk about the implications of the policies in the u. S. Quantitative easing took the fed Interest Rate from the equivalent of 3 to 0. Will we see them hike their rate . Are we going to see the u. S. Moving to negative Interest Rates . That is a huge question. Jonathan what do you think the chances are . Gabriel i think it is reasonable if we do not see economic recovery. I worry that the fomc statement was still very domestic in focus and not enough about the Global Economy. I would rather see the fed have a greater focus on what is going on in the big world, particularly with regard to u. S. Oil. About Jonathan James bevan and Gabriel Stein are both going to stay with us. Coming up, another conundrum for chinas policy makers. We look at what new pmi data tells us about the state of the countrys economy. 20 minutes away from the open. Futures around europe pretty much dead flat. Guy 43 minutes past the hour. Welcome back. You are watching on the move. Here is Caroline Hyde with a bloombergs nest flash. Caroline julius baer reported lowerthanexpected earnings after a settlement with the u. S. Over american tax dodgers and weaker client activity in the second half. Hsbc will impose a hiring and paid brees this year as part of its drive to cut as much as 5 billion in costs by the end of 2017. Stuart gulliver outlined a threeyear plan to pare back a Sprawling Network by shutting moneylosing businesses and eliminating jobs. Ryanair has announced an 800. Illion euros Share Buyback at the same time, the Budget Airline said profit after tax increase to 103 Million Euros to the end of december. That was below analyst estimates. After the Buyback Program, we will have given back 4. 1 billion to shareholders. As long as we continue to be profitable and have cigna can cash in the business, we will look to do more buybacks. Thanks very much. Chinas official factory gate signaled conditions deteriorated for a record sixth with pmi falling to a threeyear low in january. What exactly does the data tell us about the state of the chinese economy . Does it tell us anything new that we did not know already . Good morning. It is a pretty negative news coming out of china. Basically, the economy is still weak and has not seen signs of improving. Also, inamed on manufacturing sector, theervices government is pinning a lot of folks as a way to win the economy away from exporting and manufacturing this service is gauge also dropped, which bodes ill for both sectors of the economy. Does today change anything when it comes to expectations of further policy stimulus . It puts the government in a dilemma. They can try to ease Monetary Policy in order to stimulate growth. If they were to do that, they might spur greater unit depreciation, outflows, something that they have been trying to manage. It is a difficult decision for them. The other side might consider a fiscal stimulus, maybe expansionary fiscal policy. That also carries with it a great deal of risk, particularly s the debt side, where china total debt ratio continues to climb. Jonathan thank you very much for joining us today. Lets welcome in our guests, james bevan and Gabriel Stein. , on friday, there was a line that caught my attention. The bank of japan makes a move. Cnyr as the currency pair jpy is concerned, it increases they willhood that make a move. What do you make of that argument . Gabriel there is a risk that we will have localized currency wars in asia. I do not want to put a percentage risk on it, but it is there. I do not think we will have it globally because the Federal Reserve and the bank of england dont are not as concerned about their currencies as the others. That is actually beneficial for the world. The issue for the chinese is that, in the case of japan, they need the week weak yen. For the chinese, that is not necessarily the same case. As greg was saying, the weaker yen will spur capital outflows and you get a vicious circle. They are trying to control that. It might not be quite as straightforward that the peoples bank is further. There will be some easing. Will we cut rates . Perhaps not. I would be more concerned about other regional Central Banks trying to match the japanese move downwards if not necessarily into negative. The moves that we are seeing from the Central Banks are going to generate growth find curious to know how you think of this in relation to oil. James if you were talking about commodities, i would say that copper has failed to rally before oil. Seen such low manufacturing pmi data coming out of china. It is the overhang that we saw in the boom. Think there is a risk that if the pboc gets the rnb to fall, the debt that was taken on during the great boom, that is going to be quite painful. And capital outflows from china 1. 1year reached about trillion. That is a huge number and needs to be watched carefully. , whato copper, oil happens with growth here . Is it the shortterm . How does it work in terms of what the objective is . It is managing inventory run off, we understand that. Globali do nothing the growth is going to be as bad as people suggest. I do not subscribe to the view that we will have a global recession. I am not going to stick my hand up and say this is dreadful, we need a lot more growth in the system. Growth is patchy and uneven. I think we will get a shift in the oil price in due course. So a weaker dollar and stronger oil are two things that will have to move handinhand. Jonathan if we are not going to get this global recession, what do you see happening in china and manufacturing. Ofixth straight month manufacturing pmi declines. Where is the bottom for you . Gabriel if i knew. Our view is that things will turn around or cease iterating at some time by midyear. True thattainly is the risks to the World Economy are skewed to the downside. Having said that, i agree that there will not be a global recession. Those fears are massively overblown. We are in a state where all news is perceived as bad news by markets. They want to see bad news. That can change at the drop of a hat. Jonathan lets cross over to Caroline Hyde for your movers. Higher, here in london, and in frankfurt as well. On thee significantly higher side is ryanair. Even though they missed estimates, we have seen them give money back and we are seeing continued growth. Ryanair earnings doubling other earnings in the fiscal third quarter. That was 103 Million Euros, just shy of estimates. Nevertheless, 800 Million Euros of a Share Buyback. And the decline in jet fuel prices getting a bit of a boost. Mainly on the upper side of calls coming in for ryanair. Also being higher is bt. The biggest broadband provider in the u. K. Pushing into mobile and paytv. They are still managing to woo the clients when it comes to their internet product. Shares slightly on the downside. Look out for this french company. With thell to do Company Supplying oil and gas companies. No wonder they are hurting. They are having to Fund Restructuring in europe and brazil. They are raising one billion euros partly in new shares. Keep an eye on julius baer. Could fall on the back of a miss. Guy thank you very much indeed. James bevan and Gabriel Stein still with us. Reported numbers. How damaged are they going to be by this dollar that we have been talking about . James we should have seen a 10 hit. We have not seen that because of cost containment. I am quite positive. Years, we will get two 5 of s p 500 rates. This translation effect from the stronger dollar to the bottom line is fascinating. Hedged, 95 of 62 by dollars 62 a barrel. It is getting diluted somewhat even if it does benefit the company. They have huge amounts of volatility. Because of their cost efficiency, they can make money when others do not. Jonathan james, what do you take of that . Do you take the broadbrush approach to equities . The devilry is in the detail. One has to understand the Global Positioning of the company the profit. The prophet at the same time, you have to be on a momentum strategy as well. Guy do you think that the virgins is going to be the story of 2016 . Gabriel i would hope so. Yes, the dollar will go higher. Guy how much . Gabriel i dont have it in my head, but i will say that it is our favorite equity region, eurozone followed by japan. The u. S. Comes way below. Guy because of the qe story . Gabriel rising Interest Rates, profit drivers dissipating, high valuations. You look at the situation in the eurozone and japan, you have everything going for them, including potentially positive growth surprises in the eurozone. Jonathan Gabriel Stein and james bevan. About 4. 5 minutes away from the open. We are talking about the potential for a stronger dollar. The probability for a right a rate hike. It is not all that obvious. Guy it is not that obvious. The market priced in an awful lot of tightening. Havef these things affected the credit story for the united states. The market looks like it is going to open rarely flat. The open is up next. Jonathan good morning and welcome to on the move. Guy johnson has your morning brief. Guy following factories. Chinese pmi signals deterioration, equity markets fall in shanghai. Crude reality. Loania is in talks for a in the African Development bank. The message with other countries. A Budget Airline sores announcing a Buyback Program with for your profits at the upper end of the forecast. Jonathan 15 seconds away, higher across the board. A session high going into the european market. Caroline hyde has the touchscreen. Caroline that rally we saw could continue european stocks today, focused more on the stimulus coming from japan rather than the negative repercussions of manufacturing in china. Chinese stocks fell on a threeyear loan for pmi manufacturing, a japanese stocks did manage to gain on the back of that warm wind from the bank of japan. Cac 40 up ashteing the well, moves on the equity market up. Remember, we have manufacturing data across the eurozone and u. K. Later today. Will that continue to fuel optimism here in europe, as we are expecting growth across the board . The china fact is being felt in other areas. Metals training lower, copper off after we saw a manufacturing slowdown, service is not getting as much as they had previously. Were also seeing the demand side of the equation, so too d oes the supply side of the equation because we are seeing oil lower after opec is ramping up their supply. Lets have a look at gold. There is a bit of risk aversion, money continuing to move into bonds. We are still seeing these fields push lower, global sovereign bonds at the lowest borrowing cost in 12 months. Yields come down on the u. S. , on france, continuing on the tenure side of the trade. Lets have a look at stocks to watch. Some earnings coming in, thick and fast. Upnair up, managing to ramp profits. S up, wooing sale sup in the broadband potential. Vallourec could plunge on the open, a Guest Service company money,s to raise concerns being hit by europe and brazil restructuring. Jonathan thanks very much. How does asia trade . A fairly mixed session. Haidia after a terrible january, it was a continuation of that rally that started on friday when the bank of junapan another add to the 3 rally we saw at the end of last week. Exporters are getting a boost, the yen staying close to a sixweek low, giving a nice boost when it comes to the electronics and automakers. We did have the other piece of news during the day, the drive for chinas pmi. The official index dropped to a threeyear low. We did see that play out for the aussie dollar. A bit of a proxy for the chinese slowdown. Down, though it had been up. We had korean stocks keeping of 1 head up by 7 10 despite horrible export numbers. Has put pressure on the yuan as well. Korea, the export oriented requirement, something of a canary in the goldmine when it comes to the global slowdown. The addi