On friday, this after being burnt before by the fed chair. Onemonth ago until the brexit referendum. David cameron and George Osborne say britain will be plunged into a crisis of its own making. Morning, stories this though. Definitely, this bayer deal. Shareholders over the last few days have been selling the stock. They are not convinced this is the way to go. Is bayer doing anything to alleviate that concern this morning . Matt well, they will be holding a press conference or at least a conference call. And look, it is going to be a very difficult purchase to make. We have had so much scrutiny from regulators on deals in recent weeks. Inre was a cfo deal chemicals that was scrapped of the weekend. So, that is one difficulty. The other difficulty is that germans are not used to takeovers of this size. 62 billion will be the biggest purchase ever by a German Company, in corporate history. So, it is a lot to swallow, especially considering this is the first price offer. I had thought initially, maybe some burials would come in here. But the only other bidders possible could be basf, another German Company that does not typically do this kind of thing. I was speaking with our editor here in bloomberg berlin about this. We will hopefully speak with him lateron the air. But it is a difficult deal for german shareholders to swallow. 18. 38 . Stock is down it will be interesting to see how the stock opens this morning. Funnily enough, the German Market is opening a little higher this morning. Lets see how bayer and basf opens. 2 . Dax is up by this morning, matt, it looks like it will be a flat one. Matt lets take a look at what happened. Flat in asia. If you look at the broader index. But if you look at the individual pieces, you can see losses in japan. The nikkei was down. The concern in japan is of course, the strength of the yen. It is trading right now at109. 76. We had that above 110 last night, as i was watching this. This comes as the trade of the surplus swells. We had imports actually falling 23 and exports down 10 . That was basically inline with what we were looking for. You can see weakness in the bloomberg dollar index right now, down. 2 . Asnt crude came down 48. 16, iranians continue to put out as much oil as they can. They are not ready for an output freeze. Lets get to the bloomberg first world worlds. Reporter bayer has tabled a bid to purchase monsanto for 62 billion. The German Company offered 122 cash bid. With an all the proposed acquisition would be the biggest deal by a German Company. Later this morning, we will be speaking with bayers chairman, at 11 07 u. K. Time. Exports fell for the seventh consecutive month in april as the yen strengthens. This underscores the mounting abes efforts to revive economic growth. Oversee shipments provide 10. 8 in april, were 79. 9 drop estimated. Worse than the 9. 9 drop estimated. Screen, which reveals why the angry birds were so angry. Theangry birds movie took top spot from captain america civil war. Jobsame maker recently cut because of waning interest. Global news 24 hours a day, powered by 2400 journalists in more than 150 news bureaus around the world. You can find more stories on the bloomberg at top. Matt . Matt thanks very much for that. The u. S. Economy should be solid enough to merit an Interest Rate increase this year and the fed will not caved to political pressure to refrain from tightening during a president ial election year. So says San Francisco fed president John Williams. The mall, the boston fed president , who is a Voting Member this year, says he is getting ready to back tighter Monetary Policy as well. Janet yellen will be speaking later this week. Guy, and been very interesting listening to all of these fed speakers. Guy it has, but you know what, the market has been burned this way before. We have seen this set up before. You get along with the dollar and then yellen comes in. Lets talk to the strategist at ubfs Wealth Management. Why do i want to stay invested when the fed may or may not pull the trigger on the rate hike . We have seen this movie before. There are those that believe you can only stay invested if the fed remains dovish. Staying at home forever is not the default option. So, those actually believe a bit more in fundamentals. No data is getting better. Really, the output gap is tightening. Thethe fed wants to tighten domestic conditions. The country is growing. Why should we be worried about that . Sorry, you think jim is a live meeting. We are seeing a 28 chance, as far as the futures market is concerned. We have heard from so many fed speakers lately that june is a possibility. Rosengren is saying later this year. Is it too soon . Central bankers should never precommitment, quoting the ecb. That means every meeting should be a live meeting, whether you believe it or not. Fed was a bit uncomfortable of the market completely dismissing the prospect. We are still looking at the second half of the year for any moves. Guy i am sitting there and listening for these guys, but i am waiting for yellen. Because as i have said before, the set up for this is something we have been through before. Janet yellen has come in and poured cold water over this before. The have got to be in the back of traders minds. I think the markets in general are accustomed to the central bank introducing this kind of volatility. They are not sure who to focus on. I cannot recall any instances, apart from the one with the bob, where you get the chief of the central bank being o utvoted. That would probably do more harm than good. All of the fed speakers know that behind the scenes. But they are telling you, this data is looking better. To us and are going to be on hold forever. With the stronger dollar are tied with the g10. They will be much more worried about the destabilizing fashion. We have to look at the trade with china. Guy this is getting to some pretty interesting levels. It is. It looks like it is going to stay there. If you look at Commodity Markets overnight, they are taking quite a battling right now. Guy they are done massively right now. Everything is pointing to a softness in growth and demand. You have to look at the situation there and say, if you believe what people are saying in the front page article, they are serious about recutting capacity. Rates are already quite low and they dont want to cut them too much further. No more run offs, of course. They know the path is clear right now. Will other asian currencies follow . That is something we have to Pay Attention to as well. Geoffrey is going to stay with us. Next, we turn our attention to japan. Exports drop for the seventh month and a low. We check in with the worldss thirdlargest economy, next. Matt we have some breaking headlines from the bayer conference call. 122 peroffering 152 bal share. The ceo says he expects a positive response from monsanto, as far as this offer is concerned. Of course, it is an unsolicited bid. And typically, the first thing you get is a negative response. Bayer will have to come back theoretically, and offer a higher price. However, this ceo expects a positive response and expects everything on santa brings to the table. You wonder if that is a shout out to monsantos management. Of course, when the company gets purchased, the management fights against it because they dont want to lose their jobs. In any case, you can see the shareholders response to bayers bid. The speculation has been there over the last month, it has gone down 18. 4 . Now, lets get to the Bloomberg Business flash. Reporter well, matt, ryanair has forecasted that Earnings Growth will slow this year even as profits jumped. The largest discount carrier in europe expects earnings to rise 13 this year after a 43 surge in the 12 months through march. Airlines have cut ticket prices tice customers. But profit after tax in 2016, euros. To 1. 2 billion axa has is that it will stop investing in tobacco and will divest 1. 8 billion euros of assets in the industry. Bondobacco Industry Holdings are valued at 1. 6 billion euros. Said, smoking axa causes the biggest threat to Public Health in the world today. 11. 3 billion jet order from viet jet. Planes wasr 100 announced in the presence of barack obama, who is currently visiting the Southeast Asian country. Back to you. s exports fell for a seventh consecutive month in april is the yen strengthened. The underscores the mounting challenges that Prime Minister abe is facing to revive economic growth. Dropis worse the me 9. 9 that have been estimated by economists. Imports as well, fell 23 , leaving a trade surplus of 7. 5 billion. Forecast thats Earnings Growth will slow this year, even as profit jumped. We will continue to talk about that and the Airline Sector as a whole, the first, i want to go back to jeffrey yu. We jump back a second and talk to you about japan. The imports i think, that number was sort of massaged bite oil prices. By oil prices. But what do you think about that drop . This gives japanese finance impotence to, really intervene when the u. S. Does not want them to. J did nothing, they were making a big bet on u. S. Growth. Secondly, you mentioned export growth, or the lack of. That tells the what you need to know about external demand. Japan has always had an excess savings problem. This is a lot different from one import contraction is far worse the next for contraction. The cousin cannot recycle that. Because you cannot recycle it. Guy japan is a huge exporter at the moment. You look at the shape of the curve, it is japan. What happens next . Give me a sense of the policy in country and how that will impact ex country. Geoffrey if you look at some of development over the past year, fdi has picked up significantly. I think if corporate are not willing to invest their cash on shore, which is to be the case, i think that fdi will still flow. You will get higher returns that way. As far as the treasury market is concerned, it is not just japan right now. Matt i love there is a story on bloomberg. You can see the most read stories on the bloomberg. Up there is a story of Goldman Sachs managing a couple of corporate debt offerings that have negative yields. International traders still investing in this because they use cross currency basis swaps to in the end, get a 78 base points return. Are you hearing a lot about the cross currency basis swa ps . This is known in the markets. You can even see this on the Wealth Management side, to be honest. Thiss long as we have negative rate environment and Central Banks are pushing it, especially in europe, they will look at these things and say, are these the distortions being brought through to the market . Is a steady there stream of funding and people say, why not . Guy why are we talking about this intervention now at y9 . The gap right now versus the corporates benchmark, that is one gap. For japan, it is not about level. It is about pace. Now, as long guy so, kuroda is going to sit back and wait for yellen to do his harvard . Well, yes, but what happens if yellen does not do his hard work . Guy minutes away now from the market open. It looks like it will be a fairly flat story. Bayerl be th will be the big stop to watch. What are the implications on the back of this deal . Is good move all of the markets. The 62 billion bid for monsanto, that story is next. Guy welcome back. 8 52 inlondon and berlin. I want you to Pay Attention to what is happening with commodities right now. They have been crunched i asia overnight. Nyou could see a read across stocks. Iron ore you are continuing to see this money moving out of the markets. It is now having an impact on the real economy as well. Matt, the other started we are really focused on this morning. Bayer making, as one analyst put it, a onceinalifetime opportunity. Matt that iron ore chart for today, that looks like the chart from the bayer chart over the last month. Bayer is offering to purchase monsanto for 62 billion, possibly grading the world possibly creating the worldss biggest supplier of genetically modified seeds. The bloomberg managing editor for globals nest joins me now on set. Global business joins me now on set. We are hearing from the ceo that he expected positive response from monsanto. Typically, these deals get bigger after the first sell, though right . Exactly. Later today, they put up the sales. The price we have now is unlikely to remain. It will probably have to go higher, and they probably have to go higher. Guy i am going to jump in. Think there is a problem with your mic and we can quite hear you. The fx implication of a massive transaction like this, while it absolutely depends on how it is funded and how the euro market will take notice. They might have the multicurrency and credit facility. That is the norm. A lot of this will depend on shareholders and the geographical distribution of the company has well. But the net number might be a lot lower than the headlines will suggest. Immediately, you will see pricing in. If that is going to start to pick up, that could affect the fx market as well. Deutsche, vanguard, those of the major shareholders we are seeing in bayer. We will see how this one works out. I have not got the monsanto number, that we will get that for you later. It looked like the market will open flat in europe. The biggest story in t equity marketh is, what will happen with bayer today . We will bring you that market open momentarily. Guy good morning. Youre watching on the move. Im alongside matt miller in berlin. We are moments away from the start of european trading. Matt has your morning brief. Matt on this gorgeous morning in germany, bayer plans to cede for a monsanto takeover, offering 62 million in cash. And, hiking a hike. Fed president John Williams and Eric Rosengren out of boston talk up the chances of a rate rise, but traders will wait for yellen to speak on friday after being burnt before. One month ago until the brexit referendum, David Cameron and George Osborne say britain will be plunged into crisis if the country votes to leave the eu. If the ask roger bootle country is headed for a recession. Lets get to the market open. Guy looks like we have a fairly flat open. Lets get the numbers up. The picture at the moment looks like a fairly flat picture. London opening flat, paris unchanged. Waiting for the dax to open, looking for a bayer number. We are getting details out of france. The pmi numbers are just beginning to hit the tape. Rising to 51. 8. The french manufacturing pmi rising to 48. 3. The Services Number looks solid. The manufacturing number looks like. That number a little bit light. A number of things moving the euro around. The details of this market open. Nejra cehic has that. Nejra time digging into the Industry Groups on the stoxx 600 on the bloomberg. It is very much a next picture. Are seeing a Lower Oil Price today. Health care looks to be leading the gains, up 0. 4 . Is some of this down to this bayer deal . Lets look at the top stocks we are looking at. Bayer right at the top. If this goes ahead, biggest deal globally this year. Also would be the biggest takeover ever by a German Company. Bayer offering 122 a share. This was someone at the lower end of what analysts were expecting. Still talking a 62 billion deal. Shares were called slightly lower by some analysts at the open. We are talking about a 20 premium to monsantos last close in the u. S. Last week, shareholders in bayer punished the stock when we first heard they made an offer from on center. We will keep an eye on that. We are also keeping an i on ryanair. It forecast that Earnings Growth is going to slow this year after a spate of terror attacks and lower fuel prices have prompted airlines to cut ticket prices. Slowing Profit Growth is what they forecast. I wanted to look at Tobacco Companies. We did get news from frances biggest insurer, saying it will stop investing in tobacco. That is what were watching today. Matt . Matt absolutely, waiting for bayer to open here. Could take a little while for traders to get that stock open. Bayer has offered to buy monsanto for 62 billion. That deal would be the largest in german corporate history. The worldsate biggest supplier of Farm Chemicals and genetically modified seeds. Benedict is back with us. We had some microphone problems. I apologize. Tell us about the difficulty that you foresee here. Regulators have been blocking deals left and right across industries over the last couple months. German shareholders have been really worried, have been selling off the shares, in anticipation of this offer. There are huge complexities. You mentioned the regulatory side of things. Bayer is pretty positive. Weve got the banks to do the financing. We feel confident about this. We have a good Credit Rating level to support this deal. They feel safe on the financing side of things, but we should remember this is the opening shot. It will go higher. The offer was made more than 10 days ago, so a lot will depend react, soreholders the financing is one side. Then the political angle. Monsanto is seen as a difficult company to advertise in europe. A lot of people have negative views. Jin negative modifiedetically seeds, i feel like someone will throw me out just for saying it. Gmthey pulled out of research in germany a couple years ago because they felt the framework just wasnt as it should be. Guy the stock is opening down, pretty much in line with where we thought. As matt says, it has already been crushed. How are the bankers advising the defense team at monsanto going to be pitching this one . Are they going to say, go on the attack . How is this going to play out . That is the big question were all waiting