Pulse. I am francine lacqua. Lets get straight to these markets. We are seeing a relief rally that we saw yesterday. That is continuing into the early hours of the trading session in europe. From 1. 4 i want to focus on the back because overall the gains are 2. 6 if we did have a downgrade by moodys. Volatility down a touch. Pound 1. 3389. Barclays getting 3. 4 . If you look at five trading session chart, it looks very different. They were really slammed on friday and monday. Some of them lost 50 of value of the deal. Inning lets get straight to the bloomberg first word news with nejra cehic. Nejra coordinated attacks at istanbuls International Airport have killed at least 40 people. The Prime Minister says Islamic State is likely to be responsible. The attacks which injured 200 people in off at about 10 p. M. Local time. Turkish Airlines Says the airport has reopened for flight. The president of france has targeted a keep color of the financial industry as he called into question the city of londons status at a clearinghouse speeding at a meeting, Francois Hollande says the brexit book shows the u. K. Has turned the back on the idea of Free Movement of people. You lose the advantages that come with it. Slide in the runup to the eu referendum, bank of england governor warned that a vote for brexit which riga a recession. Now it seems it is on the way. Threecourse of respondents to a survey conducted after britain devoted to leave say the economy will dip into a recession for the First Time Since 2009. An majority predicts the bank of england will add more stimulus, including cutting Interest Rates in the third quarter. As manythird time in days, japans top Decision Makers have met to discuss the impact of the uks decision. After this mornings meeting, shinzo abe told reporters that he will mobilize all possible measures following the brexit vote. At the same time, Harry Tito Kuroda says the central bank can add funds to the market as needed. Global news, 24 hours a day, powered by 2600 journalists in more than 120 countries. You can find more stores on the bloomberg at top. Francine. Francine the pound resumed its decline after rallying from yesterday. In brussels, Prime MinisterDavid Cameron to express regret over the results as european leaders says there was no turning back from brexit. Cameroninal mr. Maintains that is a job for his successor. Britain should seek the closest possible relations as britain leaves the eu. Close relations over trade, cooperation, security while britain is leaving the european turn its back not on your. On europe. Francine Ryan Chilcote is an brussels. Business with for france. Ryan and frightening the u. K. At the same time. Whether the u. K. Will be up to maintain its during operations in europe. It is a profitable business. It has been a hub, london has for a while peter last year, the city of london, the financial district one a big victory over the ecb in a court in luxembourg that allowed it to continue those operations. What the french president is saying is if you leave the eu, then in two years time, and the u. K. Officially exits, you will not be up to do that, because he would love for france to take up that business. Francine ryan, the mccammon is coming back to the u. K. 20th is when other eu leaders gathering today on the agenda brexit. Brexit, group hug, group therapy. Today is perhaps more important than yesterday. Yesterday, met with a lameduck Prime Minister who can i do what they want him to do which is to start the active negotiations. What they can do amongst themselves as a group of 27 is decide what kind of European Union they want in the future. That is going to be a robust discussion. All 27 are politicians and they want to be reelected. They are well aware that back at home there is some of the same euro skepticism, some of the same questions about how good the eu is that they need to address. I think we are going to see a push for reform to a lot of the countries have been clear that they would like to see the eu change, maybe become more of a Political Club or deep in financial integration. Begun. Petition has and they will continue as the u. K. Gets its own political house and your. In order. Francine all of the latest news in brussels. More, jane lets get foley. Tim cook you have to look at the nuances of jane you have to look at the nuances of sterling and currency markets in the markets are believing that Central Banks will be delayed in terms of what fed can do. They are taking everything with stride. The be very cautious market is thinking Central Banks were going to ease anyway probably are. This is the bank of japan, maybe the ecb and maybe some others, new zealand. The market but pricing in that the fed wont hike and of the bank of england will. Why would the bank of england ease. The reason would be we are try to stave off recession it that is clearly off recession. That is clearly not a positive factor. Thats a majority government. Now what we have got . Political uncertainty. Thats not something to be celebrated. A huge amount of Political Uncertainty with respect to the Financial Services industry. Industry part of the in relation to how we we have not seen the lows yet. Francine you say the markets are focusing on the wrong thing. You see how they price in all of this political turmoil. Jane a huge amount of Political Uncertainty. It is difficult to see through that. One thing is very certain, uncertainty is bad for investments. Currency. Bad for from that point of view, it is thiscult to envisage rebound from sterling getting any less. Francine are we going to see action . Of coordinated there are problems internally. Jane if we were to see cornet thats a real price and volatility. Hopefully we will not get to that point. Will there be intervention in japan . The probability has arisen. Francine jane, thank you so much for now. With us and will be talking a lot more about the dollar. We will be bringing you our interview with the foreign secretary, philip hammond. Joins the ideas festival. You will see that at 10 30 tonight u. K. Time it u. K. Time. Forget next year, the fed rate rise will be in 2018. That is according to the markets. The economists foresee a recession and expect house prices to drop 10 at end of this year as ihs retalks real estate. Here in turkey, officials blamed Islamic State for the latest terror attack. What does it mean for the global fight against terrorism . Francine you are watching bloomberg. Lets get to Bloomberg Business flash with nejra cehic. Nagel france income cornet the tax into stumbles International Airport have killed 40 people. The countries Prime Minister has said Islamic State is likely to be responsible. The attacks was also injured 20 people went off in rapid succession at the airport at around 10 00 p. M. Local time. Turkish airlines is the airport has reopened her flights. Reopened for flights. Brexit may cost carmakers 2. 8 billion through 28 32018. Through 2018. Vodafone is wearing his options at the u. K. Voted to leave the eu. The company says it will consider moving its headquarters elsewhere unless the country negotiates continued access to the Single Market. That is the Bloomberg Business flash. Francine . Francine forget december and the next year. The fed is not hiking until 2018. The brexit derailed the tightening timeline. Jane foley, head of ethics strategy. Ethics strategy. Were pulled it back to 2018. Jane the market tends to overreact so they could come back. Important data from the u. S. Today. I think people are going to more heed into competent surveys the come up after the events. To try and work out how much impact it does have on the economy. Of course the u. S. ,t is another headwind certainly september is off the table. We have not discarded the idea of a december Interest Rate hike yet. Francine is because the u. S. Economy stronger . It wont trigger a worldwide recession . Jane it is a headwind. On the back of it, particularly it is growth prettily if growth in europe slows down on back of it. We do think it is too difficult just yet to preempt all of that and work out what is going to happen in the u. S. U. S. As yellen has been clear, we have been seeing growth. We have seen disappointments. One big factor will be the dollar because if the dollar keeps on strengthening, francine d believe we will see do you believe we will see a dollar rally . Jane it is quite likely. Dollar is the political it erupts further in europe. Extent seen that to some against the u. S. Dollar. Really poured elections next year in germany and france. The less for years, look at the european parliamentary elections in 2014. We could have more that in the wake of brexit. Maybe not. Certainly, i think the dollar is going to test given the uncertainty given the uncertainty. Francine what does this mean the for the bank of japan . Asian banks have done so much in the last couple of months and they are not going to back down now. Jane we have seen the yen stronger. That is not going to be welcomed by the japanese. The currency is not just the single problem. At least immolate demand went inflation is shrinking how do you stimulate amand when inflation is shrinking . And sugar currency is not going to help. The question is react to the mystic fundamentals and risk appetite. Risk appetite is low, it is going to be difficult for them to push against it. A large fiscal package from japan. Probability will the yen selloff in this environment . I dont think so. Francine jane foley, thank you so much. We will be talking about to the next. Up next, we update you and talk to about this talk to you about Political Risks. And talk to you about Political Risks. Francine terror attacks have killed 40 people into stumbles main International Airport. More than 200 others were injured. He focuses on Political Risk in europe. Jane foley is still with us. Iq for joining us. How did you read these terror attacks. It is always a huge tragic loss of life. I we expecting more attacks of the sorts . The risk is very tangible this is the fourth attack and assemble along since the beginning of the year we saw two more major attacks and ankara. Threatlear that the isis is within the country and outside the country. The risk is there. Islam is significant because istanbul stumble airport is the third busiest and europe and almost 61 million passengers every year. We have seen a systematic attempt by isis. Significant. Francine is it unusual that they have not claimed the attack yet . Claims their attacks in turkey. It is not unusual. All fingers. 2 isis. Francine this is an attack not only on human life but also tourism in turkey because it is a big part of their gdp. Absolutely. A good year brings 30 billion in revenues. A significant decrease because of the bad relationship with russia. In may alone, it was down 35 . If there was a chance of recovery in the second half, these chances are over. Francine is there a direct link between the fact that i. S. Is losing ground in the middle east . And more attacks are frequent and violent . Cooks there is a need to keep the franchise alive. There is a need to keep the franchise alive. They need to attract people and money. Target becauset there is presence of isis in turkey. The forces are overstretched. Threat. E the isis francine an attack like this will it alienate some of their fighters because it is during ramadan . I dont think so. Say look at target, they are normalizing relationships with israel. They are arresting our brothers in turkey and so on. The attack is well justified. And isis supportable look at this. Francine jane, looking at the markets, it does impact currencies and the way that politicians deal with the countries relationships with investors. What will the currency does what is theprospect what prospect for the currencies . Sensitive to flows. We know the economic. Mpact, the human impact this is a nail in the coffin for the tourism industry. Weve seen a low with the lira. From an economic point of view, clearly this is negative. Forcine what does it mean president aragon president er dogan . Turkey has been enduring attacks of all sizes. All of the people the minister of interior, the Security Forces, nobody is assigned it the public is starting to a wonder about this assigned. The public is starting to wonder about this. A dream of a constitutional change to allow for executive presidency. The support is that you need a strong man to run a country which is under threat from within and outside. Because to be careful the question mark about the ability of the Security Forces to tackled this threat. It is happening in central places where this is not supposed to happen. Francine jane, if you go back to theres all of this consolidation of power, this will not play out well with International Investors if we dont see something Going Forward which is more like the systems we are used to here in the west. Jane if we consider, there is a lot of fear. These are terror affects attacks, people look inward. This is not great for investment flows, Political Uncertainty. Again, it is bad for global growth. Francine is their relationship for change between turkey or the eu . Does it change the perception of citizens in the eu and a time we see fragmenting . I dont think it does it it does. Ause they were targeted apart from that, turkey is an important player in the region. Europe still needs turkey to deal with the migrant crisis. There is a need for the tackletion effort to terrorism. Francine is there any way of protecting airports . Meaning there is plenty of security. The last two weeks the Police Presence was intensified. What is not possible to do is control the cars basically because given the size of the airport, the airport is not given is not designed to do that. The security is really well done. You need to prevent the people from getting into the airport. Francine thank you so much. We are back in two. Well talk more on turkey and brexit. You guys be good. Ill see you later [ bark ] [ bark ] bye. See ya pal. Ever wonder what your pets do when you leave home . [ laughing ] aw you cutie pie. Aw. Aw. Aw. Aw. [ barking ] [ washing machine running ] partys on know what your pets are up to with xfinity home. Xfinity. The future of awesome. See the secret life of pets, in theaters july 8th. Francine welcome to the pulse. I am francine lacqua. Lets get to the bloomberg first word news. Nejra coordinated attacks in istanbuls airport has killed at least 40 people. The Prime Minister said Islamic State is likely responsible. Also injured more than 200 people and went off in rapid succession around 10 30. The airport has we open for flights. The friends the french president called into question londons clearing hub. Showed the brexit vote the u. K. Has turned its back on the principle of Free Movement of people and added that when a country abandons one of the eus key pillars, you lose the advantage that goes with it. Mark carney warned a vote for brexit would trigger a recession and now it seems it is on the way. Almost three quarters of respondents conducted after britain voted to leave the eu say the economy will slip into recession for the First Time Since 2009. The majority predict the bank of england will add more stimulus including cutting Interest Rates. Japans top decisionmakers have met to discuss the impact of the uks decision to leave the eu. The Prime Minister told reporters that he will mobilize all possible measures following the brexit vote. The bank of japan governor said the central bank can add funds to the market as needed. Global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. This is bloomberg. Francine i will get on to the referendum and just a couple of seconds but what we know so far is that markets are believing that Central Banks are here and ready to act, which is why we are seen yields on a lot of sovereign bonds ever lower. Ireland dropping to a low. We may touch a few more Technical Levels across the European Countries and we will talk treasuries in the next hour. David cameron has left brussels after his last summit as european leaders rather for the second day of brexit talks without him. Angela merkel says she sees no backing out of brexit. Fuchs. Peak with michael always great to have your perspective on these things. Clear,ancellor was very there will be no renegotiation and probably no access to the Single Market. What are renegotiations going to look like . Michael first of all, the u. K. Has to trigger article 50 and as soon as this is out and has been made, we have to form a team to negotiate. There will be no free access to the Single Market anymore. This has to be renegotiated and to say it bluntly, there is no free lunch. You have to do something or pay something and except terms and conditions which is obvious, look at the countries like norway and switzerland. They all have their rules and regulations with the market. It is the same for the u. K. In the future. Kin