Bloombergs European Headquarters in london. Im francine lacqua. Lets get to the markets, Global Equities holding near a high for the year. 600. Is a picture for stoxx i wanted to show you automakers. Folks like an volkswagens market share reached a low. We have been talking about it all week. It did see a little bit of weakness. A sign of relief for governor kuroda. Lets get straight to the bloomberg first word news with nejra cehic. Nejra thanks, francine. Goldman sachs is said to be advancing on its biggest costcutting pushing years. According to people with knowledge of the effort, Ceo Lloyd Blankfein is calling for the push which includes firings and curbs on travel and entertainment expenses. Bonds are inyield the midst of their worst twomonth selloff since 2014. Investors say they have yet to fully price in the risk of default. Speaking in washington, the governor of immediacy set of corporate debt burden is heavy, is not veryrage high. Federal reserve bank of atlanta president Dennis Lockhart said he will no longer push for a rate increase this month. Speaking to bloombergs kathleen hays, the fed official said there are still opportunities and ray to make a move. You look at the calendar, there are enough meetings remaining this year that if the data were to suggest it is the appropriate policy to have three moves, to moves, three moves, both are possible. It is going to depend on how the economy evolves. Least nine people were killed when a magnitude 6. 5 earthquake in southern japan caused the strongest shaking ins for 2011 disaster. The quick yesterday also injured more than 750 people. There were no reports of damage to japans only operating nuclear reactors. Global news 24 hours a day powered by our 2400 journalists in more than 150 news bureaus around the world. Think francine thank you so much. Inwill go to enda curran just a couple minutes to talk china. We had news that chinas economy stabilized in the First Quarter. Gdp rose 6. 7 in the first three months of the year. March saw industrial output and resale sales pick up. Lets introduce our guest, patrick spencer, vice chairman of equities at bayard. The company has over 150 billion in assets under management. When you look at china, should we be less worried more fundamentally they still have a lot of debt, so if the chinese economy doesnt management in the right way, it could go pearshaped . Essence, theyve doubled their gdp in dollar terms, so it is a Phenomenal Growth engine. Like every growth engine, it has to slow a little. The slowing seems to be bottoming. He looked at the export numbers this week which were quite startling. Numbers overnight saw money supply also and housing was up 6 in the quarter. The stats are suggesting that things are bottoming, which is encouraging. People in the market want to see stability. There is a lot of gears that the central bank can still pull huge reserves. Reserves in china were up for the first time in five months the other day. Huge reserves, more gears on the Interest Rate front. Shadow banking has always been a problem, but growth i think stabilizing. Francine lets get to our chief asia correspondent in hong kong. What do you make of the figures . Enda i think it is definitely adding to the stabilization. Quite a turnaround. As recently as january, china was viewed as a global pariah. This growth is still being driven by a huge surge in credit. That is an economy where debt has grown at a next natural rate over the last couple years as they unleashed massive stimulus. There are concerns that policymakers are pushing reforms to one side in favor of nearterm growth, doing whatever it takes to hit their growth target and concerns that may be china is storing up bigger problems down the road. It is paying for growth in the near term. I think that is a concern. Francine we are just getting some breaking news out of the pboc on credit cards. We had a great chart on bloomberg just a couple days ago, showing that a lot of chinese are still avoiding credit cards. The title of that chart was plastic isnt so fantastic pure,. Theyve set a floor limit on credit card rates. They are setting an upper limit on credit card rates on overdrawn balance. How does this come into play with how much money is leaving the country . Growth is stabilizing. Do we still have the concerns about outflows or has that been laid to rest . This i think it is part of stabilization narrative. We have seen capital outflows ease of somewhat. We saw the reserves take higher. Overnk however the threat capital outflows hasnt gone away. Look at the trade numbers this week. We saw another anomaly pointing to fake trade invoicing, pointing to people trying to get cash out and secure hard currency elsewhere. The capital outflows story hasnt gone away. The one to watch would be the fed. If janet yellen wants to signal another rate hike, that would change pressure on capital outflows. It hasnt left the scene altogether. Francine the other big unknown is the rebalancing. Are we seeing a rising share of gdp coming from consumption . Enda if you look at todays numbers, retail sales have looked quite well. That is not bad when you consider what was happening on the stock market, the confusion over the yuan, the rush to get money out, the conversation zombiethe cutback on stateowned enterprises. Through all of that, consumption seems to be holding up relatively ok. Consumers work in these industrial sectors. You have to say that it is showing signs of revitalizing even if it is not enough. Francine thank you so much, enda curran, our chief asia economics correspondent. Patrick, you were saying that you are seeking a rebalancing. The economy is stabilizing in china. What doesnt it mean for your Equity Investments . Are you diversifying . Patrick i think the important point about currency and the dollar, is the beginning of the year, theres been a lot of skeptics saying that in shanghai, the imf agreed that they will work the dollar lower. I suspect what is happening is, if you look at all the world global pm eyes, china pmi was quite strong, so i expect what is happening is growth is coming back. We talked about the exports earlier. That bodes well for equities in general. Francine how do you marry that with one the imf is saying . They are cutting growth forecasts. Is it growth back a lot more than we expected . We wouldnt be expecting it to be higher. Patrick we have to be careful about the growth. What we dont want is stagflation. We dont want inflation coming back and no growth. Goldilocksalmost scenario, where growth is ok, but not fantastic. Maybe 2 , 2. 5 . That is slowing. I think what has happened is , as i say, it is a goldilocks scenario. We dont want it to be too much. And not to sue slow. , sort of much more injection of stimulus. I think we are in a good place. Francine in a good place. You are one of the very few guests that have said that. We will talk more. Patrick spencer. Stay with the pulse. Plenty coming up, including the Panama Papers trail, takes us to spain. We are live in madrid. Then the analyst who beat the polls. The man who correctly predicted the outcome of the u. K. Elections gives us his take on the brexit vote. And Ceo Lloyd Blankfein sent to rein in costs. Francine lets get straight to the Bloomberg Business flash with nejra cehic. Nejra Goldman Sachs is sent to the embarking on its biggest costcutting pushing years. People with knowledge of the effort, Ceo Lloyd Blankfein is calling for the push which includes firings and curbs on travel and entertainment expenses. Pharmaceuticals is working with investment banks to review options after receiving interest in a number of its businesses. The drugmaker had previously said that it might dispose of certain noncore assets as it seeks to pay down some of its 32 billion in debt. The company is working to return to stable footing after a disastrous run that site stock lose almost 90 of its value. Volkswagens European Market share has reached a fiveyear low. The companys brands, including new, accounted for 23. 4 of registrations in the three months ended march. Car buyers snubbed the german automaker and termed to bmw, Fiat Chrysler, and daimler. Francine thank you so much. The Panama Papers have claimed another casualty. Hosing manuel Jose Manuel Soria claimed [indiscernible] for more, lets speak to our european government editor. Denied any involvement in the firm. Honest, as, to be completely catastrophic pr gaffe. He came out at the start of the week with these unprompted comments, saying that anybody named the papers had to give immediate explanations. Anyone who didnt have an explanation was hiding something. Barely minutes later, he himself was named in the papers. He came out with this aggressive, categorical denial of all the facts being reported and spent the rest of the week backtracking until we get to where we are this morning with his resignation. Francine that is a pretty disastrous week. How will this affect the complex political situation . This is a disaster for the pp and acting Prime Minister mariano rajoy. There has not been much suggestion that soria did anything illegal. It is simply the outrage over the contradictions. Joys party is riddled with corruption. Soria is now going to become a symbol of the corruption which his opponents are going to use to better the Prime Minister atm now until the deadline the start of next month and most likely through to the elections in june. Francine thank you so much. Scandal unleashed by the Panama Papers continues to unfold, political risk, just one of the global risk factors. Christine lagarde warned there is plenty to worry about. There is plenty to worry about. But as i have said and has been repeated several times, we are on alert, not alarm. We believe that the Global Economy can actually repair legacies, can regain its bigger, and become more inclusive. Responsesrrent policy need to be faster and need to go deeper. Alarming l right, or other, but not alarming. Lets go to patrick spencer. Christine lagarde almost shares your view that it could be a lot worse. You are more optimistic. You think theres a good deal to be done in equities. Patrick i do. Central banks can do what they want. They can buy equities if they so choose. I listened to lagarde last night and i think she framed the environment with regard to central policy. We talked about the goldilocks scenario. She was saying that yemen will be data dependent. There are going to be gradual rate increases. The communication around those increases are going to be frequent. She is going to have a view to international events. I think she framed an environment of that core deluxe scenario. We havent got the strong growth, so you are not going to see a huge amount of Interest Rate increases. Francine for me, this feels reassuring. You dont have real growth. They are rationalizing. That is a good thing. But they may be costcutting to a point where they hurt themselves. Patrick but companies, it is all about confidence. The cash is there. The u. S. Especially, which drives the engine of the world, is two thirds consumer. They are in pretty good shape. , slowing,obs, auto but they are in good shape. That will drive the u. S. Economy. Eventually, you will get normalization. We havent got a blueprint for this. They are going to work it out. They are just feeling their way through. The consumer is strong. Capex will come back. The banks are awash with cash. I think what you are seeing is growth which will benefit equities and the famous old saying, keep it simple. You get 2. 2 in u. S. Equities and the seeming european equities. Francine we are getting breaking news out of opec. This is a chart of the hour. This is the production of various countries in 2001 when we found they had an agreement to freeze production. Were just hearing from the Iranian Oil Minister that he wont attend those talks to freeze production. This is our chart of the day. It shows that despite all these countries deciding to freeze production, russia still pumped oil and that was the same case for norway. Very few left a couple months after deciding to freeze production. Were hoping that there may be a cut in production are a freeze in production, but the Iranian Oil Minister saying he wont attend. What does it mean for Oil Companies . Theres very little money to be made. Apex andd to cut cp dividend. Patrick last night, i was watching carlyle, the big private equity company. I think it was, baker hughes, buying a lot of assets. That happens at the bottom of the cycle. What you get in the cycles is, companies tend to cut costs. The next thing they start to do is cut capacity. That is what youve been seeing in the last 18 months. You are coming to the end of the bottom of that cycle. It is like catching a falling knife. Maybe Oil Prices Going little lower. Saying that inventories would be in balance because of the cuts in shale was an important milestone. You look at all the stocks, the oil stocks are outperforming. Francine from a very low base. Patrick correct. Chesapeake was up 30 . Francine patrick, thank you so much for now. Can russian opec take credit for the oil rally this week . The Iranian Oil Minister will not join the other ministers in doha. We are back in a couple minutes. Francine welcome back. We had breaking news the last couple minutes that the Iranian Oil Minister wont intend the doha freeze talks on sunday, but who will attend in his place is the iranian back governor. Opec governor. We know that iran has said in the past they want to pump as much as they can to get back to the production before sanctions, but maybe theres an agreement amongst the others. Posed for a second weekly advance. An output freeseas top of the agenda. Almosts a global glut vanishing later this year. Patrick spencer is still with us. Patrick, you said, a lot of the Oil Companies share prices increased significantly, but from a low base. There must be better valued stocks out there. Patrick sure. In terms of the u. S. Market or generally . Francine give me your three best shots at making money this year. Patrick it has got to be in equities. Ive been in equities for 30 plus years. It is still the only wealth creator left in this business. Francine with negative rates, youre not wrong. Patrick certainly, that pushes you more into my point that i was trying to make earlier. In the u. S. , youve got 2. 2 yields on the s p, 1. 8 in 10year treasuries. Ply put, that is going to you talk about negative rates. Cash is being structurally attacked through negative Interest Rates. Holding cash doesnt do you could anymore. Youve got to go back into a wealth creating machine, which is equities. U. S. Equities, 2. 2 . Bonds, 1. 1 . Markets are always up the following year when you have this disparity. Francine patrick, thank you so much. Welcome to the pulse live from bloombergs European Headquarters in london. Im francine lacqua. Lets get straight to the bloomberg first word news with nejra cehic. Economyhinas stabilized last quarter, meeting expectations. Growth calvert is in march as a surge raised for us questions over the sustainability over expansion. Industrial output and retail sales also picked up last month and beat analyst forecast. HasPanama Papers scandal seen the ousting of another european figure. Spanish industry minister Jose Manuel Soria has resigned after links to an offshore company. He first denied any involvement with the business, then backtracked as new revelations showed he was involved in a firm registered in britain. A little over a week since his predecessor was ousted, icelands new Prime Minister is pushing ahead with economic reforms. Explained how his country is taking the final step to removing the capital controls that have been in place ands the 2008 financial crisis. If we are successful with these conditions weve put in place and we fulfill them, i envision that we will have removed capital controls on households and corporations, and the pension fund will have been let out with more funds than theyve been able to do up to this point, and we will also have in place precautionary measures needed to protect the general public and the national interest. Global newsnejra 24 hours a day powered by our 2400 journalists in more than 150 news bureaus around the world. Francine thank you so much. European markets are in the red this morning. Lets head to bloomberg with mark barton. Mark stocks in europe are falling for the first day in six. They are set for the first weekly gain in five. China once again setting the tone. We had First Quarter growth of 6. 7 , matching estimates. Asset investment and retail sales picked up in march. Theres the index today and all its main constituents, down by 0. 4 . This is the yen this week against all its Major Trading peers. It has fallen against most of them. These currencies have risen against the yen. It is headed for the worst week against the dollar since the boj unveiled its negative Interest Rate strategy on january 29. The dollar rising over 1 against the yen this week. That lessened the speculation for the boj to intervene in the market. We had kuroda speaking yesterday in washington. He said he had no plan to bring up the forex markets or currency intervention. Are penciling in more stimulus from the boj. One of the big corporate stories today is from car four. Shares are up 3. 9 . Frances biggest retailer reporting higher firstquarter revenue. Growth compensated for a decline in china. Happy anniversary or not for the stoxx 600. A year to the day, the stoxx 600 hit a record high. 600 hasen, the stoxx fallen by 17 . Lets look back at the past two peaks for the stoxx 600. Look what happened thereafter. 50 in thell of over ensuing years. 50 housing bubble,