♪ >> good morning. welcome to bloomberg markets the european open. this is what we are watching. trashing the tpp. president-elect donald trump lifts the executive actions. will it really make america great again? when doves cry. 100% ford december. u.s. equities hit all-time

highs. will europe keep the party rocking? screaming,signals what is the right trade right now? we will talk about that. >> at. we are less than one half-hour until the open of european trade. take a look at european you just. speaking of keeping the party , gains of almost 1% on the ftse and the dac. the highs we had yesterday on , threer inch marks indexes and one average should continue to carry through asian markets into europe this morning. morning washis getting close to calling me pedantic but we will discuss it later. equity markets rally. likely to rally further. positive story.

s&p 500 of 7/10 of one percent. japanese yen down. swiss franc, down. your down to tenths of one percent. metal rally high. iron ore up. think rising. led rising. we will be talking about copper a great deal. oil looking positive ahead of opec. let's find out what else is going on. >> thank you. u.k. labor party jeremy corbyn says business leaders and trade unions expressed concern britain is headed for a hard brexit. jeremy corbyn warned of the impact of such a move. >> the idea of what i suppose ,ould be called a hard brexit much more than half of our traders with europe so it would

be very, very damaging indeed. >> in european central bank resident mario draghi said more urgent is needed. he pledged to maintain the stimulus.ney he spoke to the european parliament in strasbourg. japan has lifted tsunami alerts after the earthquake. urging residents to flee to higher ground. five residents injured. some bullet train services suspended. operations normal mostly. and a coach fired. coming under pressure after two painful losses in the opening qualifying matches for the 2018 world cup. in a statement they said quote the growth of the team left us convinced we need to go in a

different direction. global news 24 hours a day powered by more than 2600 journalists and analysts in more 200 countries. imagine that. ask president-elect donald trump outlininged a video executive actions that his quote administration can take on day one. these include scrapping old regulations, including some on energy and getting rid of the transpacific partnership. >> on regulation i will formulate a role that says that for every one new regulation, too old regulations must be eliminated. so important. on energy, i will cancel job killing restrictions on the production of american energy including shale energy and clean coal, creating many millions of high-paying jobs. that is what we want. that is what we have been

waiting for. on trade, i am going to issue a notification of intent to withdraw from the transpacific ownership. a potential disaster for our country. instead, we will negotiate fair bilateral trade deals that bring jobs and industry back onto american shores. trump, the president elect. market reaction? let me walk you through a couple factors. up. chart ties it 100%. probability we are not pricing. the is the word here on right-hand side. you can see 100%, 100 percent. the front part of the curve are reacting. back to me maybe being a present and not educated in the idea that the fund is less liquid and eight better guide, that is in the 90's. not all 100 percent.

>> ignore both of them. of course it will. joining us to discuss this to get the house view for 2017 is the global cio at ubs. p overseas investment strategy that encapsulates $2 trillion in assets. good morning. eggs good morning. thanks what is going to be the biggest tax for the market? donald trump or janet yellen? >> janet yellen is now the focus because it is the sum total for everything the fed sees on the horizon and terms of everything in the global economy. in pricing and some of these political do virgins is that a fed us and lay ahead. >> what are we trying question how are we pricing in the trade story? donald trump is not going to go into this in asia.

you have to wonder what he is going to do on the trade front. how much of that positive news is in terms of what he is likely to do on day one? >> i think the market is looking in hopefully of out a lot of the things donald trump can do but as you pointed out, some of these other promises are coming through. i do not think the underlying bluefly of seen in the equity market, the reason the fed is considering hiking, has much to do with donald trump. it has to do with the continued strength in the u.s. economy. so we have to separate these a little bit. >> one of the things jim bullard told me, st. louis fed president, is that tax cuts, fiscal stimulus, and reduced regulations will have a faster affect. a shorter to medium effect whereas trade will be a longer-term drag. not felt immediately.

where do you think investors should go first to take advantage of short-term gains fiscalx cuts and stimulus? >> we have been overweighting u.s. equities and overweighting high-grade bonds like the 10-year. you can stick with that now. not because necessarily that, again, the policies are going to innge that much but because particular, u.s. earnings look like they are going to be improving. only because the commodity trade is unlikely to fall apart like idid last year. we are starting to see that earnings growth pickup in the united states and that is a factor under our bullish call on the u.s. many of theso companies from the u.s. and on the ftse get earnings from overseas. are we going to see european multinationals post better

earnings as the u.s. economy picks up? >> well i think there are some differences. the ftse is getting about 70 percent of its earnings from overseas. the u.s. economy is more insular. where i think they combine, if you're going to play european equities when i was is focus on gettingmpanies that are increasing earnings from emerging market consumers because we think that emerging markets are likely to improve because they have been hit so bad over the past couple years and again they are going to benefit from this commodity turnaround. drags talking to mr. monty a little while ago. a few reports ago. he talks about the fact that clients were paralyzed. nervous. they do not want to commit to trade. do think the game has changed? are we in a new world? our clients willing to step out and step into these markets or they still so nervous about what they see in front of them in terms of what is happening in italy, france, germany?

tofirst, i am not going disagree with our ceo. >> but the world has moved on. and ourspoken recently investor forum and he makes good points about the way the client see the world. nervous.still they up and together many different political and economic events over the course of 2016 and are skeptical that everything is going to work out so well in 2017 and that is why we titled our 2017 a look "the " because so many of our clients are saying, we see the gdp ratios. political unrest. cap this come together in a way that is positive and what are the signs that things are going negative? we tried to walk people through scenario and play along on our cio website.

when everybody thought the world was coming to an end at donald trump's initial election, you saw the markets go down. it you also saw that chance of a wayrate hike getting priced out, right? so you have so many forces together in a three-dimensional chess game. the only thing we know is different economies will take different paths forward. >> all right. hang on. you will stay with with us. we have more to talk about. on the european market open. we will continue to look into ubs's 2017 outlook. coming up, donald trump's plan to bailout. he says he will issue his intent to withdraw from the tpp on his first day in office. we will discuss what that means for asian. also, that ecb president warns the challenges facing europe has increased. we will hear what mario draghi

has to say about the long-term impact of brexit. and to jeremy corbyn raises his concerns about the country's decision to leave the eu. how damaging could exclusion from the single market be? the former secretary joins us to discuss that and plenty more. this is bloomberg. ♪

>> 15 minutes to the market open. here is what you need to know. >> the long-running pilot strike dispute over pay. it will affect short and long-term flights. it will come today after two wingactions at the euro division. inre will be job reductions western australia. a spokesman said the outlook remains allengg for the division but would not say how many positions would be cut. after theys came said 500 jobs would go. and abigail johnson will succeed fidelityr at investments. she has been ceo since 2014 and well maintain that role. the move comes as the money

management giants face intense competition from vanguard and others. a carpark dispute with a resident in beijing. the company apologized after these that aroused critical commentaries in chinese media. that is sure bloomberg business flash. >> thank you. we were going to show a chart that shows the three main indices and the average. matt miller thinks he has a better chart. so we will show you that chart. miller, what is the better chart? matt: so first off, i do have the four benchmarks all rising to record highs. we titled it "party like it's

1999." issue with you take anyone calling the dow industrial average and index. gdp ratios, i think the interesting point of this new trump agenda is he wants to orse spending $1 trillion spend an extra trillion dollars and it is going to be difficult. this setup is one of the reasons it will be difficult. this is the reagan era. into bush, because both republicans. 50ht here at debt-gdp, percent. at the end of barack obama, 105 percent debt-gdp. so we are fully leveraged and then some. leverage it isof argued on our balance sheet, it

grow.ficult to i know ubs expects something like 2.4% gdp growth in the united states next year. are you concerned about this debt to gdp level. >> absolutely, that level creates more uncertainty and makes the future more volatile because it increases confidence but i think what the market has reacted to is that this fiscal spending 10 increase. -- can increase. and the productivity we may get out of it, and that was something that the fed official was talking about yesterday, could increase. so, first on this spending, you know, japan did a lot of fiscal spending to try and stimulate its economy and it did not work. at the beginning of the obama

administration we were talking about shovel-ready projects. there is a belief at this time more project can be launched because we have a republican sweep and both the president and the congress can try to focus on getting projects through. it also they have talked about kind of a more public-private partnerships not just spending programs that are not going to necessarily have a productivity boost in the teacher. so that is one of the changes we see. certainly, what this has really done i think, the most important thing, is remember it was not that long ago where the central bank claimed that this has to shift. we're at the limits of monetary policy and the governments will not pick it up. now this has shifted the narrative where we have a government that is saying, yes, we met -- maybe at the limits

but we want to shifted to fiscal policy and markets a see a way forward where we do have a different path. >> so making the transition away from monetary policy, mario draghi does not feel like he is ready to shift away from monetary policy. this is going back to the 1990's. it is pretty clear that direction of travel. that has being down. muscle memory must teach me that is going to continue. what is going to change the narrative when it comes to s, made itields? pops a little in the states and maybe it is the short-term story but i am not ready to commit. what has been a very long-term trajectory for the bowl market. it stabilizeay these rather than shoots up. all we've learned from these different episodes is how interconnected all of these bond yields are.

there is a limit. even if things are going well the united states, there is probably a limit to how much they can rise there when inflation and other factors are keeping it so low and other parts of the world. >> stick around, still time to spend. minutes away from the market open. 10 minutes way, nine minutes away to be resized. cutting jobs in australia. a challenging outlook. that is interesting. the supply side is still a story in the metals market. we will talk about that next. this is bloomberg. ♪

♪ greg's all right, it is just about seven minutes to go until we see markets open across the continent and in the u.k. i want to take a look minutes from the open at some of the beps -- stocks that may moving. you may want to keep an eye on left on-site in germany as pilots prepare -- on lufthansa in germany as pilots plan to strike for short and long haul flights. that is concerning to me because i am trying to fly to frankfurt tomorrow. so i guess i will look at the berlin or some other option. the cockpit crew once raises. the flight attendants have

already taken raises. this is for the union or the cockpit crew. the flight attendants are the euro crew. look for delays even at heathrow tomorrow. jump on a about to plane to saudi. i hope his not find lufthansa. what you expect to hear about the oil market? market: there are two big questions as we go to the gulf now. first, saudi remains the producer. how do they think short-term about where they want oil prices to be. with all that oil in the ground, did they see that as an appreciating or a depreciating ast? >> what do think the answer is? >> i think they are hedging their bets on it being and -- and appreciating asset.

>> thank you for sharing your valuable time with us. the global cio at ubs. next.sh open is coming up we expect europe to continue partying like it's 1999. stocks are set to rise. this is the open. ♪

guy: good morning, welcome. i am guy johnson. matt miller in berlin. we are moments away from the start of trading. mr. miller has your morning brief. tpp, donaldng the trump lists the executive actions he will take on day one in office, but will this make america great again? when doves cry. 100% for december as u.s. equities hit all-time highs. it will europe keep the party rocking as markets open?

commodities continue to heat up as goldman sachs turns positive with short-term signals screaming overbought. what is the right trade right now? guy: medal struck talk about where this market is going. europe pushing equities higher this morning. that is the trade judging by the future. let us take you to the european open. we did rise a little bit into the auction yesterday. there is the ftse 100, opening up. 0.3%. up i we expected to open by 0.7%. some of the oil stocks to watch out for. rising, but not as much. 0.7%.you go, up let us break it down, find out what is moving the markets. >> thanks, i am starting with the gilt market. the 10 year treasury yield pretty much on changed -- put much unchanged.

yields have been moving lower in europe and it looks like 10 year going became way. down two basis points. we are at 1.40%. we saw energy stopped and material stocks leading the gains in asia and europe yesterday. it is those materials that are outperforming here, up 1.4% almost. with copper hitting its highest and since july 2015 and goldman sachs turning overweight on commodities for the first time in four years. energy stops up 0.9% with oil price up as well. it is green pretty much across the board here. up 0.6% on the benchmark overall. stxe 600 rally. i wanted to show you this chart.

things might not be gd if you're looking at european earnings, but they could be wors they have been worse, because analysts are at their least pessimistic. profits are going to drop 2.4% on average this year, but it is an improvement from the 4.5% reduction in october. let us move on and see some songs we are looking at this morning. i am starting with kingfisher. first quarter total sales beating estimates. kingfisher says it remains confident in its ability to deliver its plan. i am looking at compass group as well, the world's biggest catering company. the ceo has been saying this morning that anything spared, we will get back to shareholders. he is not concerned about inflation. sales numbers beat estimates as well for compass. these are the two stocks we are looking at at the open. guy: i want to take everybody to stops on the other

move as well this morning. we mentioned the fact that the miners are reasonably well there's. up 5%. glencore, 3.73. rio, 3.2 percent. the miners are definitely on their front foot this morning, matt. matt: so are the indexes, and one average. from yesterday's close, check out the chart i have got here, guy. arty like it is 1999 is phrase you will hear a lot of today. we started using it last night, not really in reference to prince himself, may he rest in peace, but to all four of these u.s. benchmark hitting a high, the first time they have been a together since 1999. thewhe line here, the purple mine here and the pink line pink -- line here and the

line here. i can just show you we are toting poster and closer 19,000 on the dow jones industrial average. right now, i guess it was normalized, actually, we are 18,956.at we could hit 19,000 today. uy: let us bring in the the chief investment officer. >> everyone is putting it down to economics and i heard you discussing the gdp. you can take into account the demographics. manish: they are going to do fiscal spending. working age population. if you compare where it was a 1981, the u.s. working age

population was rising at a 2% clip, and now it is a 5% clip. ,f you look at what a trump president-elect trump has said about on authorized immigrants, they make up 5% of the labor. that is too much of fiscal spending making the market moved to farm too fast. -- too far too fast. guy: we will see how congress deals with that. maybe we will get homeland investment. that brought back a lot of money and helps out the big caps, the russell, and helped by banks. how much cash have you got? almost 30% cash in the portfolio. this is something i had raised before the trump election. the market value that. you may not get the trend correct. you do not have somebody, this is like somebody who is not political.

you are not able to interpret what this person will the clarcor do something. for you to think were the dust is going to settle is key. the market is running far ahead. up inone risk coming terms of the italian referendum which is a big thing. both are saying there is going to be a no. if you want to -- for the market to continue rallying. if it is no, it opens a whole can of worms. that is going to cause a lot of consternation. guy: what about risks to the upside? matt: you are holding 30% cash, and blackrock did a study showing that the world investors are holding 50 to $70 trillion in cash. is that something that is going to spur that cash to come back into risk assets? manish: i think it will. foronally, i can speak

myself, looking at confirmation, you know, because remember, president-elect trump does not until januarynt 20. a lot of his reforms will have more impact. in 2018, everything happening up front. i am looking for opportunities for the cash to play when there or somell selloff disappoinent, and there is bound to be something because clearly, people have interpretations to what his advisers are saying. i'm waiting for those opportunities. i am not bearish market, that i in the risk sentiment respect to the referendum and the election cycle is negative. for --ot as much allocations. matt: when you will that money in cash, what currencies are you putting it in? talked to mark from ubs who says they expect the euro and pound to appreciate against

the dollar in 2017 because interest rate increases are not going to keep pace with inflation increases. manish: for me, we are more dollar-based. i do see that the euro-dollar could appreciate slightly, and the market is pricing at 100%, nearly 100% probability of a rate increase in december, but we also have to see that given how -- there is a tightening of financial conditions. some job for the fed is being done by the market, which means you will not really see the fed raise rates at the same clip as some are exciting. i think that is -- as some are expecting. going onlking about the back of the dollar rally which is already 19% up over the

last four weeks. i don't see how much or how further it can continue. there is definitely room to appreciate. guy: i am getting this chart ready. let us close that up and get it ready to go. dax is trading. not a great deal of volatility at the moment. it has got its direction and is going to stick with it. manish: i would be a buyer. i think that, you know, people are not taking into account what the italian referendum could really do. if it comes, even two weeks ago, the prime minister renzi was saying he is not going to resign. hisas expressed doubt it government can survive. that opens the question, look at the nonperforming loans on italian bank balance sheets. it is almost 40% of the whole eurozone number we are looking at. it look at the italian gdp growth since 1999.

it is paltry compared to what we have seen. there is a resentment. it is also about how he wants to change the legislation because he wants to cut down the power of the senate. some people are not voting. it is how he wants to govern. there is a good chance you might get fetid in that and that may have consequences. defeated andget that may have consequences. guy: how is the u.s. president-elect trump trashing tpp going down in asia? farage ishere, nigel ambassador to the united states. the relationship with vince cable. too many doomsayers. why the premium on political risk in europe could be excessive. all of that is still to come. this is bloomberg. ♪

guy: we are 30 minutes into the session and europe. let us look at the equities. we are up by 0.6% on the 600. the london market is outperforming, because the minors are outperforming. matt: i am taking a look here, guy, at the individual movers on txe 600.

this gives you a couple of different views. percentage change, you can see the big gainers are the miners. if i percent gain, but bhp billiton, glencore, all rising. steelmakers up as well. if you take a look here in this dropbox at index points, who is 600,g the most to the stxe glencore is at the top, but you get hsbc in there. some of the banks are adding some. shell and bp also putting up because they are such big companies, pushing up the index a little bit. we do see some oil and gas companies as well as some of the metals and mining companies making the moves this morning. let us go to the bloomberg first word news desk and hear what is going on around the world with sebastian salek. labor party jeremy

corbyn expressed concern that britain is heading for a hard brexit. corbyn warns over the impact of such a move. >> the idea of what i suppose would be called a hard brexit, much more than half of our trading's with europe, it would be damaging indeed. sebastian: mario draghi said more urgent action from government is needed to address the structural weakness of the euro area. he also pledged to maintain the ecb's current monetary stimulus. he was speaking to the european parliament in strasbourg. japan lifted all to nami alerts -- tsunami alert. reportedle have been injured and some bullet train services suspended, but toyota plants in the region were operating as usual.

this is bloomberg. thanks very much. donald trump, the president elect, says he intends to withdraw from the transpacific partnership agreement on his first day in office. trump's comments follow last week's meeting with japanese prime minister shinzo abe who said there is no point to the tpp without the u.s.. mr. trump: on trade, i am going to issue our notification of intends to withdraw from the transpacific partnership, a potential disaster for our country. instead, we will negotiate fair bilateral trade deals that bring jobs and industry back onto american shores. matt: for more bloomberg's chief asia economics correspondent joins us from hong kong. this?gnificant is a failure of the tpp if it actually happens? over, it ises fall

a blow to a number of the governments in this region who put significant political capital into it. you only have to think of shinzo abe who flew to meet resident pleadedump and no doubt for tpp along the way. vietnam whoose in put a lot of capital into hoping tpp would bring down terrorists .nd and how market barriers ariffs andown ter market barriers. guy: china sees this as a great opportunity? edna: i guess that is the flip side of it. entertage left u.s., and china.

there is this alternative trade talk that has been talked about. asea an aussie on lead -- n-lead deal. if that one gets off the ground, it does not have all the bells and whistles that tpp has. the tariff production is less and the barriers internal markets are not taken down as much as they would have been with tpp. it shows you how governments in this region are going to have to increasingly turn to china for leadership if president-elect trump cut back on trade in favor of bilateral trade deals rather than the big multilateral deals might tpp. guy: thank you very much. maybe a golf driver doesn't buy you much in trump town these days. it certainly seems that abe's

meeting did not bring much. how much do i need to worry as i look at my asian investments, about what is happening with the relationship between the u.s. and asia and the fact that china , the hegemonic push, is going to continue. it will have the ability to drive its side of the fence, it's story of the u.s.? is on the back of the trump victory. i continue to maintain that. not perish, but i am not going in at this time because i expect -- will rise. only when we see -- you will start thinking maybe emerging markets are going to come back. people are going to come and by the asset class. the asset class.

there is time to think what he is planning to do. that is the key. i want to just jump in here because you made a good point about china seeing this as an opportunity. we have a great function on the whichctr breaks down world trade. from the u.s., the biggest trading partner is china, $626 billion in trade with china. then, canada and mexico, until you get to japan. if you plug china into the drop-down box, you can see its biggest trading partners after japan and south korea. these asian relationships are much more important and they will be able to take a much from advantage of them. do you think we are seeing increased isolationism whathe u.s. if you look at

steve bannon, -- for the u.s.? manish: if you look at steve bannon, he says america needs to bring these jobs and production batch of the u.s.. i don't know if it is possible to reverse this policy because clearly, it is not that the u.s. created the asian economy. it is also the u.s. relied on cheap labor and funding, especially funding in terms of u.s. treasury, who owns the u.s. treasury, an and benefited from that. china,n opportunity for no doubt about that. as you have seen, they are trying to drum up support for a local trade deal and u.s. made a big mistake by not becoming part of the foreign policy. u.s.-china cooperative relationship is in the interest of both the parties. if u.s. tries to be difficult, china wills -- than

go out and make its own opportunities. australia is talking about doing a trade deal with china. it is an opportunity for china, but not without pain. guy: europe is an even bigger trade for them. fantastic function, but what you can do, just add a few things together. you have got the netherlands, united kingdom, a whole bunch of countries and their makeup europe, and if you think it -- you think about how the relationship with europe works going forward from here, and europe is not talking about any of these deals. matt: that is a very good point. as long as you count europe as a block. are we going to continue to count europe as a block? guy: i think you should. probably should put europe as a block.

if you think of europe as trading regions, it becomes a more important factor in this. anyway, mario draghi is probably thinking about this as well to be honest. matt: absolutely. i was making a little bit of a joke in light of the fact that you are leaving and of course, we see what happens with the referendum in italy in just a couple of weeks and then you have french elections, and who knows how long the eu stays one whole lot. speaks about how this will have long-term it impacts and calls for fiscal ask him. -- long-term impacts, and calls for fiscal action. this is bloomberg. ♪

guy: welcome back. you are watching the open. mary abu dhabi says brexit and donald trump's election will mario draghierm -- says brexit and donald trump's will have long-term effects. dollar inearly, every the stimulus will be harder to come by. i don't expect a 12 month extension of qe. guy: you think about how that is going to operate in the markets. how do i worked that one with treasuries doing what they are doing? thesh: if you look at inflation numbers, you have 0.5%. clearly, you are going to see

deals with a relative because i don't think it will change much. guy: it was great to see you. singh. we will talk to fence cables. vince cable. ♪ seeing is believing, and that's why

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with high-speed internet up to 10 gigabits per second. you wouldn't pick a slow race car. then why settle for slow internet? comcast business. built for speed. built for business. matt: welcome back to "bloomberg i amts: european open," matt miller in berlin and guy johnson in london. take a look at "the board after the u.s. big benchmarks hit record highs altogether for the first time since 1999 including the russell 2000 and the major three. we see big gains for european stocks as well. driven by oil and commodities, right? absolutely spot on.

matt, you were bringing this up earlier on, and that is what is happening with fidel, -- with the dow. as matt has been indicating, it is an average. it has only got a handful of stocks, many industrial. up here ands box you get a fair value calculation in this column. what that tells us is we are 0.155 to be opening up by at this point. that should take us up to the 19,000 level, which means you can see another headline this morning. today, we have been talking about party like it is 1999. 19,000! matt: there are no hat. it is only for the big, round numbers. we will get a hat for 20,000. guy: i will hold you to that. matt: i will have a batch made

here in germany, for sure. guy: made in germany, ok. what is going on in terms of driving is we are seeing the commodities moving higher. what else do we need to be looking at? partying likeout it is 1999. it is a party in the commodity market today as well. goldman turning over weight on commodities for the first time in four years. copper at its highest close. the miners rallying here. anglo american at 520%. bhp up 4%. glencore rally and in the oil and gas base, some are performers because we are seeing week high.hree- this is after it reported an oil discovery in the barren sea. tois commodities you want watch in individual stocks and the best performers.

i am looking at compass group today, a little bit of a different story. basically, four-year sales were a b. it will spend -- were upbeat. it would spend money on acquisitions and anything spare is going to be given back to shareholders. in earlier, we spoke to the compass group ceo richard cousins and he told us the company is not overly concerned about inflation and is positive about the future, saying he does not believe the trump presidency will have much of an impact on the business. >> they want our quality and service and at a sensible cost as well. our scale, low cost of the structure means we can deliver that for them. beat asividend was a well yet we are seeing the stock down 3.4%. guy: thank you very much indeed. i am going to go get a business flash. let us talk to sebastian salek

about what we need to know. sebastian: pilots said to strike tomorrow. longuld affect short and services in germany. flight attendants at the groups euro wings division. the u.k. treasury has sold more shares in the weight banking loyd's banking group. 20 billion pounds was injected into the bank during the financial crisis. it seeks to cut its remaining stake in lloyd's. u.s. investigators are investigating why -- that is according to people familiar with the matter. u.s., u.k., and israel, pleaded guilty to conspiring to the fraud the u.s.. bank declineded to comment.

be job reductions in the iron ore business in australia. it said the outlook remains challenging for the division but would not say how many positions will be cut. comments came after abc reported $500 would go. johnson will succeed her father. she has been the ceo there since 2014 and will maintain that role. edward johnson is retiring and will become chairman emeritus. the move comes as the giant faces intense competition from rivals including then guard and blackrock. and blackrock. the company -- spatat arouse anger -- the arouse anger. that is your bloomberg business flash. take anotherd to

look at european equities here and in light of, you know, the highs we hit yesterday in the on., on the dow, on the s&p, the nasdaq, the russell 2000, we are a ways away from that here in germany. the dax is far off of its 12,000 in 2014, 2015.k i believe the ftse high was also around 1999 and we have not got that back to that yet. we are also not looking at volume that we have seen recently. this is a critical function. put your sector up here. in can the average volume green. projected volume in the bloomberg is always spot on. it is just not going to make it. we are seeing lower volume and you can break it down into sectors and see where that lower volume is from.

morevolume in banks and volume in basic resources and utilities. it is a very interesting function that helps you break down a lot more than the price action. in, with thatit hand that comes across? matt: just the hand? that is the adams family. [laughter] guy: that is what we are watching here. cousin it has the here. i am mixing up my adam family characters. the thing, i think, is what -- matt: yeah. guy: we like to provide a little bit of variety in our programming. s.tt was breaking on the sv that is where the real gain the coming through in europe this morning. materials definitely the big gain as we are seeing the miners doing pretty well through some of the oil stocks doing pretty well. this on the back of big gains. iron or, copper continues to be

-- we work our way towards november the 30th. i will keep my hand out of this shot. i think we should probably step away from that. next, the premium of where we built that in terms of european assets. we will talk to a man from gadfly. this is bloomberg. ♪

matt: welcome back. imf miller in berlin. guy johnson with me in london. my hand, you will see a lot throughout the program as well. this is the european market open. it seems like the road ahead is lined with banana peels, but one examined -- when examined in isolation, the threat seems less daunting. mark joins us now. thank you so much for your time. how can traders o afford to be complacent with so many risky situations ahead in europe? trump,fter brexit and traders are risked to look for risk premiums.

they look for it everywhere. the one certainty about europe is there it is always political uncertainty so it seems like fertile ground to find disasters. i argue that even though the italian constitutional referendum and the french and -- dutchions provide elections provide clear risk, europe will likely get through these things without major turmoil. guy: we will probably get through it. that seems to be the story of the last few years. referendum is interesting because yes, maybe, the government does come a little bit on start, but maybe what we end up with is some sort of caretaker administration which in the past has not been a bad story. is it possible to put a positive spin on this? mark: absolutely. i think the mp's in the italian parliament know their seats are not safe if there is another election so they have no incentive to call a general election so even if renzi steps

down, most likely, there will be no technocrat government which will continue to general election by a year. even if there is a general election and the five party is leading in the polls, it is unlikely to get the majority of support leading europe as people fear. matt: we were making light of this earlier although it is not funny, there could be serious problems in france and holland as well if elections go wrong. what makes you so confident they will not. ? mark: the freedom party in the netherlands is leading the polls there, but it is unlikely he will form a majority. i think we can be more relaxed with the dutch one. the french political system has inbuilt safety.

while marine le pen is likely to lead the first round of voting, it is likely she will lose in the second round of voting. every candidate from the center-right will beat her in the second round of elections. those polled have been reliable thus far. we can rest easy. bloomberg daybreak's mark cudmore. next, not down with tpp? president-elect trump says he is going to scrap the partnership on his first day of office. this is bloomberg. ♪

guy: 46 minutes into the equity's assessment. minas and particular well bid this season. why are commodities rising? president elect donald trump has put out a video to update people on his transition to the white house and his policy plans. he says he's going to bring jobs back to america by scrapping the tpp, the transpacific partnership. i am goingon trade, to withdraw from the 10 pacific partnership, a potential disaster for our country. negotiate fairl bilateral trade deals that bring jobs and industry back onto american shores. guy: donald trump speaking overnight, updating everybody on

what his plans are. joining us now, since cable. -- vince cable. he will discuss what a 21st century industrial strategy can do to rebalance the british economy. good morning. global trade seems to be coming on picked or at least -- unpicke d. how does the industrial strategy form itself? needs the u.k. a new way of thinking for many years. written has operated with a very short-term -- britain has operated within short-term cycles. you need an industry perspective. sectors likeervice universities. you need, i think, partnership, public/private sector, innovation, research and development training, access to finance. i think mrs. may, we had our

differences come up but i think she understands that and is keen to get back to the framework of industrial strategy we had during the coalition years. guy: wouldn't it be easier to have a strategy if we knew what our membership or non-membership with the eu was going to look like? vince: that is the problem. we have a problem of what has been called "radical uncertainty." guy: you cannot have a long-term industrial strategy without uncertainty. in theif you are aerospace industry and you are trying to build the next generation, you cannot sit around waiting for these issues to be resolved. guy: what you need to know? we arei think what getting is a sense from theresa may that she wants a brexit light, soft brexit. keeping probably the customs union. that is more controversial. i'm sure that is what the

industry has been promised. maintaining as much stability as possible albeit with the one thing she had to have politically which is some degree of control over migration, not necessarily the full whammy, but as much as possible. matt: mr. cable, can i ask, i am confused as to how it would be possible for the u.k. to expect membership to the single market or entry to the single market without accepting also free movement of people. it seems like it is something the europeans will not negotiate on. vince: that is the central that is of doctrine and what the europeans say, however having spent five years dealing with the european union as a minister, i had responsibility for trade. it is more complicated. market,nd pillar of the services trade, does not operate on single market principles.

the germans for example largely opted out of most free trade and services. so, i think the british view would be that they have taken up the tough negotiating position and are standing on principle, but in practice, we can hope for at least some degree of flex ability, and that is what i would -- flexibility and that is what i would be wanting to start for. matt: the car industry is being ,ased so largely in the u.k. the european car industry that of it isw much european countries selling into the u.k. so the u.k. can assemble those cars. for example, when he's on puts together a car that has a turbocharged v-6, they are coming over from germany, right? vince: there is a high level of integration in the supply chains on the import content of most totish vehicles can be 40%

50%, though it has been falling over the last few years. that is why the customs union is so fundamentally important because if you had to impose a errorist on -- a widget --every guy: i want to come back to a function we were using earlier on. this is u.k. trade and where it all blows. the bulk of it goes to germany and then the united dates first and second. there is a view increasingly it seems within the cabinet that donald trump is going to be great for u.k. trade. indeed, we can have nigel farage as our chief diplomat. "it with you there because that is not the view of the foreign office. medicine talk about what you think we could be seeing in terms of trade going forward --

i think we need to take it easily in terms of time. there is no way the british can negotiate bilateral trade deals with anybody until the issues with the european union have been resolved. guy: eating that is actually going to -- do you think that is actually going to? vince: why would donald trump, once he puts aside the rhetoric, want to set aside considerable political capital to have a separate agreement with the u.k. writer than the europeanunion -- rather then the european union? the u.k. is not a major partner for the united states in economic terms. what can they offer us to make a significant difference to where we are? scarlet: guy: the politics is

very important because he made a lot of brexit. he used the word, the rise in use of the word brexit. he sees it as being the precursor to what he has achieved in the united states. vince: indeed, populism has been a common element in the u.k., the u.s., and other western countries. to the big jump nitty-gritty of what you do with standards and trade negotiations. all of the problems we have had in europe, for example, in negotiating for many years, a trade agreement with canada. it illustrates some of the difficulties when you get into the nitty-gritty. vince, it is one thing to talk about regulations with the car industry. have the mexican disease in the u k everyone was promised would the brexit.n after

for example, the fisheries in cornwall and other coastal areas , do you think we will see those regulations listed as a result of the brexit and the domestic economy thrive in the u.k.? vince: it will take years and years to get a new fisheries arrangement. it is a good example because if voters british brexit what are the awful things about the european union, fisheries would come close to the top of it. that in 2012, a new fisheries agreement was negotiated and it was not too bad. everybody accepts there has to be restrictions to prevent overfishing in areas like the north sea. those problems remain. this is not a frontline issue years would be 5, 7, 10 before a new kind of arrangement came through and one has to think about new investment over that very long time period. guy: to wrap this conversation up, talking about your dealings

with the european union, what do you think their perception of us now that trump has happened is? do you think there is a shift? atyou think they are looking the endless world, heaven knows what they are doing? watchingink they are us incredibly nervously, thinking, "we are next." vince: there is a deep sense of anger and hurt because the single market was a british creation. i mean, the whole idea of free trade and services and goods and free movement of labor was a british idea. and yet, it is the british who have walked away from it. i think that causes massive anger and frustration. what the europeans are trying to do is manage their own very difficult populist uprisings in italy, france, germany. at the same time, having a

calibrated reasonable response to the u.k. it is not in their interests to have massive friction with the u.k.. common sense will prevail. guy: that wraps up the open. surveillance is coming up next. from matt miller and i, good morning. ♪

francine: trade-off. don't plans to shred the transpacific partnership deal his first day in office. will china fill the void? things markets know with certainty about the trump presidency. all four major benchmarks making records. in a world of disrupted trade couldents, theresa may negotiate a better deal for britain. this is "bloomberg