Market bets. And the loser is price waterer house cooper apologize for their oscar mistake as la la land is accidently announced as the winner in a spectacularer best picture mix up. Lets get back to our top story. Al shares in deutsche exchanges deal appears in danger of collapsing, this after the British Group said the European Commissions was unlikely to approve the deal. But why . Here from frankfort to talk us through the latest developments. Reporter the latest is that lsu is dejected to divest a part of the italian business which the e. U. Commission is demanding. The lsu putting out a statement saying they couldnt comply with the latest demand from brussels. This would actually not go through the regulatory business in italy and also that wouldnt really help their extending in italy. So thats exactly where we are now, that brussels is demanding further action from the lsu where the lse is not complying. I was hearing from sources close to douch berger that they could comply with the new demand and it looks like the merger is not getting through with the latest development. The new deadline is end of march when the e. U. Commission will come out with a statement whether they find a way to remedy the situation or not. But for now it looks like the merger between the lsu and deutsche is becoming a lot less likely. And deutsche burzer is completely surprised. Do they have a plan b for how to go forward . Would they try to go after another Exchange Provider . Would they go it alone . Well, probably yes. The big lan from the ceo is to make them big enough to compete with the likelies of the Mercantile Exchange or the Hong Kong Stock Exchange in asia. So thats actually the size he foresees for them. Hes of course very much behind that merger. The driving force, he says that a operator in the new financial times, as he calls it, needs to be bigger than just the stand alone player. If that merger falls through, its the third time theyre trying to merge or take over each other. Then we most likely see more action from deutsche in asia or elsewhere. And generalality shares have fallen following the banks decision not to take over a formal bid for the insurer. Saying it would not create value for its shareholders. So there are two deals that have fallen through very quickly over the weekend. Kind of reminds me of last week when the heinzkraft deal never happened. A lot of interest in deal making that moment. Were seeing real comeback. Here in europe weve been trading fairly flattish. Were just a little bit below the flatline on the stoxx europe 600 and the really big thing to watch out for happens tomorrow with President Trump giving the state of the union address. So we could hear more of plans about tax cuts and possibly deregulation and infrastructure. Thats what the markets would like more clarity on. Whether or not we get more details, but our European Equity markets and the upside, top left hand side of your screen, food and bevererage, Household Goods and technology up. 10 . And Warren Buffett in what he called a remarkable u. S. Economy. Saying a collection of conservatively financed companies are quote virtually certain to be worth more in the future and saying quote tide of talented and ambitious immigrants was a key ingredient to americas biggest achievements. Hell be speaking on squawkbox so make sure you stay tuned for that. Maybe the sage of london. The head of research at brun dauf dauf saying the 100 bil has been lost for investors the last couple years. Whats your defense . It has to be put in the same bracket as Warren Buffett. Its rare that. But certainly if youre doing some crude analysis, almost throwing darts, youre likely to find an underperformer. Those who arent seeking advice encouraged to take passive options, i would argue. But there is some low hanging fruit in active management, people like buffett and we could read off names if you like. But if Due Diligence and hard work is applied, theres still value found in active management. I dont know whether its miraculous. Yes, the stock markets are telling us exactly that story. Actually treasury yields have dropped to levels we saw well before the november elections. Whos right . Well, i think the bond market has played its role in allowing miraculous recovery. Its helped with the refinancing costs for several compoanies an they were at such a low level for such a long period that financial instability has been removed from our assessments of the u. S. Economy. But here we are with u. S. Businesses in reasonable shape and seeing bond yields move a little bit higher and maybe encourage them to actually start thinking about putting their Balance Sheets to work. Why do you think that european politics is a red herring . Its a bit of an aggressive statement. I think the ultimate fears we have about euro skeptic parties taking control are unfounded. I think political predictions have made people quite humble in 2016. And nonetheless, le pen should be comfortably beaten in the second round and you look to the netherlands and they would likely command the most votes but not get the level of support he needs to lead a government. So while the headlines are sure to create volatility, ultimately we dont see them as euro skeptic leaders. Most people wont completely rule out a lepen win. Even if she doesnt win, there does seem to have been a significant shift to the far right. Isnt that going to influence european momentum, markets . I think so. Theres a big political debate. The way politics is shaping up is that you have those in leadership sort of open and euro file and the opposition becomes euro skeptic. So further down the line, if you do have quite a severe recession, which can happen. Its not an imminent threat but they will happen, then t electorate seems to be in tthe opposition. And then you really could have another existential threat upon you. I dont think many investors will be as brave as you and certainly not the ecb either. They cant afford to raise rates as would be mandated by their outlook. Essentially their hands are tied, right . They dont want to derail recovery by talking too hawkishly. But it is starting to recognize the data is improving. Indeed there are muteinary inflationary pressures but not enough to begin tapering. And while we dont ultimately see these euro skeptic parties, we recognize the threat and theres certainly the headlines around the first round or getting the most votes but not taking power. Theyll recognize and talk rather cautiously in terms of its tapering agenda. What about u. S. Equities . We would be buying european equities into these political headlines we think will present selling opportunities. We think the u. S. Is right in the imminent weeks and months. And that might come as early as tomorrow. Always a pleasure having you on. Head of fund, research. Good morning. Regarding the lse deal, he says better not done especially after the brexit regulations, they come into effect. Im trying this alculine coffee at the moment. Slightly grumpy. You seem pretty nice. Yeah, well. Street signs europe cnbc. Com. And were on there directly as well. carolyn cnbc. And their shadow of a scandal. We found out whats hot in barcelona live from the mobile World Congress and next up were talking to the ceo. Shares in u. K. Home builder for seminar trading near the top. An increase for 2016. They have pledged to increase its dividends against a back drop of rising demands np companys ceo warns that a shortage of labor could curtail housing building going forward. The actual output is probably at the top end of where its ever been. Were actually building over 150,000 house as year. So were put in the sites to make sure we can build the demand were meeting to see. And that other end, weve got issues with training a lot of people. Weve got nearly 600 trainees in the business at the moment which is about 13 of the work force, so all the industries trying to respond but that is a pressure on us at this present time. Nokia shares have been getting a lift after it announced a range of new smart phones and its relaunching its old one. They spoke to the hme global group and asked why it decided to bring this handset back. Fans asking it and me ever thinking whether we do it or not and lets have some fun. Noek nokias a fun factor and it would create an overall halo that nokia is driving the next chapter. Karen joins us in barcelona. Some of us are really happy to hear that the basic phones are coming back, karen. Louislouisa, thats because e a smart person. Dumb phones are for smart people. Joining me now is the ceo of ee. Nice to see you. This spich off factor. We have so many smart phones, emails, every facebook, twitter, social media we can really have. But you say smart people want a phone that can do the basics so they can switch off their smart phone. This is about choice and a wide range of products. But were definitely seeing demand from the most connected customers that they want simplicity and be able to turn off sometimes. What does it mean . Is there a seat at the table for them . I think definitely theres a role for them in the market. They have a lot of credibility, a lot of customers, have a good nostalgia for that brand and i think theres a place here at the table for them, definitely. Youve been boldened in debate and whats the big focus for your group now . We have a huge focus. In the u. K. We have a network that is building out to 95 geographic coverage of the u. K. Up and down the country and we focus on geographic coverage first and foremost. And i think in a connected world that becomes really important to us. So im here to look at Network Technologies that can help us role out that network faster and more and more customers are using video more often on their smart phones and we have a unique position running the Emergency Services connection in the u. K. Which were creating for the 300,000 fire police and ambulance services. You were one of the key lobbyists against being dedicated to Emergency Services. He lobbied for a check so you could use some of the funds. Is that a misstep . Because the u. S. , canada, columbia, mexico, argentina, that iall have emergency spectrum. With new Network Slicing capability on show at this show, were able to create what is effectively a dedicated network ruthless preemption is the standard in other countries. If everyone is connected to a cell via a mobile phone, youre not going to kick off those customers to give calls to emergency serves. I think that would be an expectation with us running that network and its a fantastic program. And all eyes are on us to deliver this within the next year and weve announced Great Innovation with drones and balloons and Emergency Response vehicles too. A lot of press about helium balloons. It all captures our imagination but theres so many issues getting past regulatory hurdles. So whats the capability of using those innovative products. We have them working already live in our test environment, using satellite and i expect we can get a balloon up and running within the year and thats our ambition. In the uk . Absolutely. And this is part of our story, not just for the Emergency Services network but for Rural Communities in the u. K. , those areas hard to reach, difficult to cover and when we have situations like power cuts, were here to look at innovation, to build on that, to make sure we can keep customers connected. Thank you so much for joining us here at global World Congress. I know thats been pretty big after the u. S. Election, after all the hacking allegations. We toss it back to you in the studio. We like your quote. That smart phones are for dumb people. Ill take it. I wont expose that i have a really sophisticated phone at home. But its true about the switching off. Did you play smak back in the day on the nokia phone . I did. You need to go get one. Beautys in the eye of the beholder. We take a look though at some of the weirdest and wackiest phone designs. Youre seeing some of them on screen. But check out the full slide show and stay tuned for the latest news and interviews. I could never get my head around the oyster. I quite like that wup. One. President donald trump will use his first major speech to congress to his bundlet will include quote massive military and Law Enforcement hikes. They said welfare spending were not facing any cuts for now. Meantime private equity executive has dropped his bid to become President Trumps secretary of the navy. He said he could not satisfy ethics rules without having anned averse impact on his finances. This only a month after Army Secretary withdrew his candidacy for similar reasons and democrats still reeling from big losses in november have picked a new leader. Mr. Tom perez. Reporter after two ballots in atlanta, members of the Democratic National committee chose a former labor secretary tom perez. He beat Keith Ellison by 35 votes. Immediately he moved to unite the party, naming Ellison Deputy chair. If youre wearing any tshirt, i am asking you to give everything you got to support chairman perez. Reporter perez has a tall task ahead, replenishing the dwindling cash supply and state legislatures and congress. We need to make house calls, we need listen to people, we need to get back to basics. Reporter if he has anied a vaptage, its that the young presidency of donald trump has energized groups of opposition. I know we can win the battles ahead, i know we will when we put our valueser forward when we lead together. So now more than evwe need stay engaged in the field and online. Reporter with their former president ial nominee pledging her continued support in a social media video, democrats in atlanta say they see better days ahead for the party. Well, glancing at our european markets and in particular at our european debt markets, pushing lower and the bund yield a little bit higher this morning, having fallen around 30 bases points compared to 10 bases for the month. And indeed also check out World Markets live. It runs all the time throughout the entire european trading day. Hello and welcome. Youre still watching street signs. Your headlines today. Deal and danger. Deals in douch deutsche bors ere fall and they will not pursue a bid for the insurance giant, jenarality. And active managers have cost clients 100 billion in wasted fees with bad market bets. And the loser is. Price waterhouse coopers. It apologizes for the oscar mistake as la la land is accidentally announced in a spectacular best picture mix up. Good morning everyone. Lets pick things up with our top story. Shares in Deutsche Boerse off by 4. 7 . The lse off by 3. 2, after they said the European Commission was unlikely to approve the deal. The lse said the commission asked it to sell a 60 stake in fixed Trading Platform to satisfy antitrust firms. They said it would struggle to upload mts and that any sale would harm its business. How are the markets looking this morning . Well, we open pretty flattish and we hold on to a ftse and xetra dax and we are seeing a little bit some reaction to the bigger deals not happening or by the looks of things running into hurdles. Shares trading down in both of these big companies. When it comes to the fx markets and the euro dollar 1. 05. Shy of 1. 06. The issue is for how long that can continue. Meanwhile the deputy finance manager told the broadcaster that greeces creditors would avoid a socalled bail in. Theyre avoiding substantial forgiveness. Germany has been a long term opponent of such measures. And german chancellors party is neck in neck with the social Democratic Party according to the latest survey from the institute which found that both parties would win 32 of the vote if elections were held today. Now the spd has surged in poles since nominating martin shoals as its candidate but theres still seven months to go to befo before it only 30 of germans would like to see him as chancellor. But the the question is what sort of coalitioning the two parties would form. Shes been such a strong figure in germany, right and has had had had so much support. Speaking of support, macron is set to beat le pen. The consulting survey shows them securing 61 of votes while figueroa sees him winning with 58 . Macron has ben fitted from being backed by the former banker. At the same time fillon has slammed french government, siting a National Rally last week which saw people injured. They said france was witnessing a quote quasicivil war. When looking at whats been taking place in yields and bond yields, we have been seeing quite a movement of this flight to safety and as we were talking about the german tenure yields dropping quite substantially, a lot more than were seeing in the states and this real flight to safety pushing bond yields lower. Were seeing a little bit of lower. And good morning. How much do you think that the spread between the french and the german bund yields is going to widen up to the 23rd of april when we have that first round . I think wever already seen the spread move a fair distance. So when trump won that election, that was the capitalist for her to start increasing her chances to win and weve seen it raise to about 80 bases points and really because its very difficult to see anything that derails le pens campaign at this juncture. Shes almost like a trump character and whatever bad news gets shrugged off. The competition a bit like Hillary Clinton in that negative news, questions of their character has an impact on the polling. Le pen very likely to get through the first round and win it. At that point i think the markets might get panicky. What happens if she wins . If she proves the polls wrong and actually wins . I think the first reaction is that first round we probably see spreads of 120 150. If she wins, maybe 400. The real down side risk is redenomination o