Welcome to the pulse live from bloombergs European Headquarters in london. Im francine lacqua. Today is all about the u. S. Jobs data and whether it can give us an indication of what janet yellen may or may not do in june. This is a picture for the msci index. Down 0. 2 . We are down on the week, the biggest weekly loss since february. Yen rising a touch ahead of that key american jobs data. Haven,u look at yen as a weve seen it increased this week. Lets get the bloomberg first word news with nejra cehic. Nejra the aussie dollar has dropped and bond yields have fallen to a record after the rba reduced its outlook for core inflation. The quarterly statement sees underlying inflation of 1 to 2 this year. Disinflation will be a key challenge for incoming rba who willphillip lowe, succeed Glenn Stevens in september. U. K. Voters have given their first verdict on Jeremy Corbyns leadership of the labour party. Early results suggest sustained losses across england and in elections to the Scottish Parliament. The bright spot for labor may be the london mayoral race. Khan has run a probusiness campaign, distancing himself from the leftism of corbyn. Japan may not be able to ignore the yens growing strength much longer. Prime minister shinzo abe says hes ready to respond to excessive currency moves, saying he may raise the issue at the g7 talks. The Exchange Rate must be stabilized and japan would carefully watch and respond to these movements as necessary. A weaker yen has been a linchpin of abenomics. Oldman jobs is cutting jobs in cuttingrity unit, roughly 10 of workers according to people with knowledge of the situation. The dismissals in new york and london build on cuts that had targeted about 8 of fixed income personnel last month. 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. Francine jobs data in the u. S. Will the number keeps the possibility of a june rate hike alive . Four regional fed president s said yesterday they are open to the increase, but investors arent buying it. Fed futures around 10 , down from 20 just a few months ago. Economists predicting 220,000 workers were added last month. Can the data to what the officials cant . In terms of the projection, i think wrp has risen. We will get more on that shortly. Lets bring in Stuart Richardson, chief Investment Officer and Founding Partner in wealth management. Great to have you on the program on job stay. How much importance is the jobs when you look at Janet Yellens thinking . We look at risk, china still a risk, brexit is a risk, so are they really live for the june meeting . Stewart in terms of importance, still an important number, but probably less than it was 6, 12, 18 months ago. Theyve pretty much meant their target. To all intents and purposes, they have met their target quite some time ago. I think what is increasing in importance now is the inflation data coming through. With what has happened with oil in the last two or three months, i think everyone expects inflation data to pick up the pickup. Francine does it make june a live meeting or do you think june is off the table . Stewart i dont think they will go in june. I think what regional fed president s are talking about is keeping the narrative. Aey have to talk about positive narrative and build that narrative. With yellen, cheese on the dovish side. I think she wants to see more data across the global spectrum. The global risks, although they downgraded last time, they are still in her mind. That would be the benign narrative. The less benign narrative is the fomc is divided and theres a much greater desire to raise rates, whereas we think galen is dovish. We think yellen is dovish. Justine so we should trust the markets. Even the chance of one rate increase is 50 this year. A little bit less than 50 . And a 10 june live meeting. If they were to raise, what we had a huge turmoil or temper tantrum . Stewart a few days of position adjustment. I think the market is comfortable with weaker inflation. To suddenly try and exceed the market pricing, you would see an adjustment about where the fed is going. Theyre going to francine it is only a couple of days, right, before we have the referendum. Bullard saysough hes not concerned about brexit, im pretty sure it is going to be on there. Francine at least look at it. Stewart they have a great excuse not to do anything in june, partly because of brexit, together with at the moment still in line cpi. As long as inflation doesnt jump in the june meeting, i think they will not move. Francine thank you so much, Stuart Richardson. We will be talking about some of the market volatility next. Stay with the pulse. Plenty coming up. Donald trump backs briggs it calls brexit while abe for britain to stay in the European Union. Plus, north korea calls a congress. We are live in pyongyang. Then, turkeys turmoil. What does political upheaval in turkey mean for europes deal over the migrant crisis . We will bring you the very latest. Francine welcome back. Lets get the Bloomberg Business flash with nejra cehic. Monte de paschi are higher after posting firstquarter profits that beat analyst estimates. Bad loan provisions looking for a buyer to shore up its finances fell. What income fell to 92. 3 million euros. That compares with the 23. 4 million euro average estimate. Arcelor mittal firstquarter profit dropped 33 as the worlds biggest steelmaker contended with slumping prices and a decline in iron ore. The company has maintained its fullyear earnings target. Arcelor mittal shares are lower this morning. Shares plunged as markets reacted to the doubling of its recall in the u. S. 40 million airbags will be added to the recall. Will collaborate but says it is not aware of any substantial risk from the products in question. Tole and sap are teaming up deliver software. It opens a new avenue for apple to reach businesses when sales have tapered. Sap will develop hundreds of apps designed for apples operating system. The Companies Say the deal has the potential to attract millions of Software Developers and sell millions of devices. Francine thank you so much. Japanese Prime Minister shinzo abe has come out in support of britains staying in the eu. Spoke at a bilateral meeting with Prime Minister david cameron. Japan clearly would prefer britain to remain within the eu. It is better for the world that britain stays in a strong eu. We want to see britain in europe be influential on the global stage, contributing to peace and stability, including in asia. Francine Presumptive Republican nominee donald trump has also weighed in on the subject, saying immigration in europe is one reason the u. K. Would be better off exiting the eu. He made the comments on a fox news interview. Meanwhile, a nationalist set for a third consecutive victory in Scottish Parliament has voters delivered mixed results in the final electoral test it for next month brexit referendum. Assessment from rob hutton. Still with us is Stuart Richardson. Thank you so much for sticking around. Rob, how much do these results tell us about brexit . That is the question everyone in the city is asking. It is hard to read too much into this. Next month. Brexit heres what you can read into this. The brexit would be a revolution. Last night, we had the biggest vote outside the general election. 43 Million People entitled to vote, lots of vote cast, and very little change. If this is a country on the brink of revolution, theres no sign of it in these results. We just had the final scottish result. Snp remains in government, has gone back slightly. The big bad news for the labour party is they have gone into third place the hind the conservatives. Francine a wider political takeaways, is it all about scotland . If they lost some states, they are still powerful enough. Stewart certainly. Nationalism, independence has not gone away in scotland at all. That said, in scotland, if you are voting for a revolution, the snp had a majority. It has just edged back from that. Perhaps voters want things to stay as they are. Francine does it mean anything for Jeremy Corbyn . Rob that is the problem. Jeremy corbyn needs voters not to want things to stay as they are. Jeremy corbyn said this is a chance for voters to decide which side theyre on. It is hard to explain how precedented this is. An Opposition Party has never lost seats. Local elections are your chance to kick the government. Voters always take that in britain. It looks as if the conservatives are going to gain seats. We havent had all the results. That may change. Jeremy corbyn has asked the voters, whose side are you on . Francine very quickly, then i want to look at the market implications, but what about the mayor election in london . There is one guy against it and one guy for it. Rob i think you have to say, if you thought that khan should be mayor but you also thought britain should leave the eu, would that make you vote for Zac Goldsmith . Maybe, but i expect the london mayor election will tell us something about london, about the candidates, but im not sure we should read too much about brexit. Many times a day do you get asked about brexit . Stewart too many. Francine every hour . Stewart the problem is not much has changed in the last month or two. The market looks like we are going to remain in. When you look at the different polls, it is much closer. Mostly still to remain in, but much closer. At the same time, weve seen the u. K. Economy softening. Voters aret a lot of quite confused. They are getting very mixed messages about the potential extent of the economic downturn if we come out, but we know what europe is like and we are not sure we like that that much. I just dont think a lot of people know. Arecine if voters confused, what are investors doing . We dont even know what the boe will do. It is probably the most interesting Monetary Policy experiment. Stewart when they turn up in the voting booth, they kind of whatto say, just vote for we are comfortable with. Our point of view would be we probably remain in. We see some relief rally in u. K. Assets, including sterling. Then the hard work begins. We already see the economy slowing down, which is partly u. K. And brexit, but also part of the global slowdown. Global trade still remains in the doldrums. We know that the government is continuing to squeeze on austerity. It is quite a long road out for the u. K. Finances if we remain in. If we come out, then it is going to be interesting. This is a very binary outcome for the market where we just dont know what the answer is. Francine markets hate uncertainty. President obama shows up. Shinzo abe shows up. Then trump speaks to fox and says, you should leave. Do voters take this into account . Rob the interesting thing about this referendum is a lot of voters dont even know why they are being asked the question. They dont have a particular toolkit to decide how we should be in the European Union or not. That is not a question ive had to think about before. If you talk to people who study referendums, the shortcut of voters use is who is on which side. The government campaigning for in would be very happy. They put out a poster last night. Here are all the people say we should stay in, obama, both clintons, new zealand, abe, everyone. Given the way trump is widely regarded in the u. K. , i think they would be happy to have trump on the other side. Look at people you respect. What do they say . Then you can make your decision. Francine great insight. Thank you so much, rob hutton and Stuart Richardson stays with us. Up next, the countrys most important political meeting in 36 years. We are in pyongyang live as the conference gets underway. Global stocks are feeling a little bit of pressure. This is your market check. Everything today is about u. S. Jobs data and what that means for the fomc when they meeting june. Stocks in europe down 0. 5 . People are trying to position themselves i had of this american jobs data. The yen rising in touch. It will shape the u. S. Interest rate outlook. Still with me is stewart richardson, chief Investment Officer and Founding Partner at mg wealth management. This is the s p chart back to 2011. I think what is being debated the most is, can this continue to run, or is this it . Monetary policy is coming to an end. Stewart technical point of view, to a lot of people, us included, it looks like a 2100 last ceiling on the markets. Looked a couple weeks ago we would try to run through that. That was a bit of a goldilocks environment. We had the dollar softening, Interest Rates remaining below. The market prepared to ignore deterioration in fundamentals. Got a a sudden, weve very different outlook. I think this is down to the performance of the dollar. It is broadly built on these gains with the emerging market and Commodity Currencies being the weakest of the bunch. I think this is a sign that there are worries around the world despite the three months of better performance from risk assets. No change in the big picture problems around the world. Francine stewart, thank you so much for now. Importantas most political meeting in 36 years gets underway today. Tom mackenzie reports on what to expect from the seventh Party Congress. Tom north koreas leadership is putting on a show and everyone is expected to be in lockstep, even the kids. The seventh Party Congress is likely to cement kim jonguns grip on power. Analysts see a new Central Committee will be appointed and key loyalists will be given top positions in the party. It is a chance for the leader to present a united front to his people and the world. We hope to report on the economy, but our government minders instead took us here, pyongyangs childrens palace. For them, this is proof that kim jongun is fulfilling his promise to improve peoples living standards. Policy is to do that at the scene time as developing Nuclear Armed missiles. Across town, we were driven to an old armory, a reminder of the armys central and continuing role in north korean life. Weve been taken to see some military history. Bys rifle apparently fired kim ilsung and his wife, and later his son, kim jongil. They all apparently it fullsize. Lseyes. L hitting economic targets will be harder. A new middle class has sprung up in parts of pyongyang, but much of the population remains poor and middle nourished. Sanctions against north korea are the toughest in 20 years. Hit Commodity Prices have what little the country does export and the government continues to rely on china for aid. Most will have to wait for the curtains to come down on this piece of a pageantry before we get clear insight into north koreas future. Fromine we will have live Tom Mackenzie at pyongyang through labor day. Up next, could the eu migrant agreement fall victim to the powerplay in turkey . That. Nalysis of our top story of the day is u. S. Jobs data. Stocks retreating before that data. Yen gaining, aussie weakening, all about inflation. [ soft music ] e. T. Phone home. When you find something you love, you can never get enough of it. Change the way you experience tv with xfinity x1. Shoah, ha ha. Ew artist. Show me top male artist. My whole belieber fan group. Its not a competition, but if it was i won. Xfinity x1 lets you access the greatest library of Billboard Music awards moments, simply by using your voice. The Billboard Music awards, live sunday may 22nd, 8 5 pacific, only on abc. Francine welcome to the pulse live from bloombergs European Headquarters in london. Im francine lacqua. Lets get the bloomberg first word news with nejra cehic. Dollar hasaussie tumbled and bond yields fall into a record low. The Central Banks quarterly statement sees underlying inflation of 1 to 2 this year, down from the forecast in february. Disinflation will be a key challenge for the incoming governor, who succeeds in september with few policy weapons in his armory. U. K. Voters have given their first verdict on Jeremy Corbyns leadership of the labour party. Early reports suggested sustained losses across england and scotland. The bright spot may be the london Mayoral Election where polls suggest khan is likely to defeat goldsmith. Khan has run a campaign distancing himself from the leftism of corbyn. Japan may not be able to ignore the yens growing strength for much longer. Prime minister shinzo abe says hes ready to respond to excessive currency moves, saying he may raise the issue at the g7 talks leader this month. Abe says that japan would watch and respond to movements as necessary. A weaker yen has been a linchpin of abenomics. Goldman sachs is cutting more unit,n its securities roughly 10 of workers. That is according to people with knowledge of the situation. The dismissals in new york and london built on cuts that had targeted about 8 of fixed income personnel through last month. Global news 24 hours a day powered by 2400 journalists in more than 150 news bureaus around the world. Francine thank you so much. Markets lower this morning. Lets head to the bloomberg with mark barton for your asset check. Falling,cks in europe on track for their second weekly decline and biggest weekly drop since february. Those are the industry groups, just one trading higher, real estate. The index is down by 0. 5 . We are waiting for the u. S. Jobs report. This is our u. S. Function telling us what economists are forecasting. This is the figure that matters or one of them,