anna: good morning. welcome to "bloomberg markets: european open." mark cudmore joins me in singapore to take us through the market action. the cash trade is less than an hour away. here are your top headlines. the u.s. says that fully vaccinated americans can ditch masks in most settings. in the u.k., prime minister boris johnson says he is concerned about the spread of a very, while singapore times

restrictions. signs of a strengthening u.s. labor market suits concerns about inflation, halting a three-day slide on wall street. elon musk doubles down on his criticism of bitcoin, digital currencies. welcome to "bloomberg markets: european open." 7:00 in london. mark is with us from singapore. what are the markets saying to you? mark: the markets are generally finishing the week in a positive tone. most equity markets doing well across the asia region, despite the factor has been a tough week for markets. it's finishing pretty positive. traders were incredibly distracted as we discuss the new virus restrictions coming in many countries, not least my

home country of singapore. anna: absolutely. let's quickly check out what's happening in markets in terms of the futures and gmm screen. let's have a look at futures for europe. the context behind this is that yesterday we saw gains in the united states, trying to draw a line in the sand between what's been a difficult start to the week for risk assets. we had a mixed picture in europe. this is the futures picture for europe. we expect to see some gains at the start of trade. expecting to see some gains coming through. what does the gmm say to you? the commodities part of it screaming out with negativity once again. mark: absolutely. for about the 20th time in the last month, it's commodities stealing the limelight again. we are seeing a massive collapse in commodities. up until a day or two ago, it was all about which commodity was surging the most. terrible day across-the-board for commodities yesterday and it has really followed through. particularly some of those metals that are getting whacked, because chinese policymakers are

stepping up their aggressiveness against the recent price surge. that's one of the big stories, the sharp collapse in commodities price. the other thing to draw attention to is that generally across the region, we have seen strong equity performances, with chinese equities surging again to finish the week, they are right back in the middle of that range. i'll been -- i've been thinking they were going to break out to the downside but they finish this week stronger. anna: it is worth reflecting on the different dynamics that we see around the virus and control of the virus in different parts of the world. the narrative is really diverging. in the weeks where we care about reduced mass work in the u.s., vaccinations, we have small flareups in the virus where you are and it leads to really strict lockdown measures being imposed. in the u.k., we are also talking about coming out of restrictive measures, but there is concern around certain variants. the story seems to be diverging

a but at this point. it is -- mark: it is diverging massively. traders talking about their plans are next week with indoor dining opening up and everybody talking about how great it is, making european travel plans. over in asia, it is a completely different story. in singapore today, we have effectively just gone back into lockdown, only announced an hour ago. group limits will be cut from five people to two people. we are ending indoor dining. we have had a great for the past 10 months. it's a worrying sign for the world that the region that looked like it had dealt with the best, looked like it was most ahead is going back into another wave. singapore has done pretty well in the vaccination from. it's ahead of most all of your. yet -- vaccination front. it's ahead of most all of europe. anna: i was looking at some of the stats.

singapore, 27.5 percent of the population vaccinated. 4.2 cases per million lead to talk of a knife edge and clampdown's and change of lifestyle for you, and all of the lockdown measures. compare that to the united states, where 41% of the population has been vaccinated. it's not staggeringly higher. it's not at herd immunity levels. we have 95 new cases per million. just like at the beginning of the pandemic, we are seeing different structures, different cultures playing with this differently and acting on this data very, very differently. mark: yes. i think this is a theme we will see emphasized over the next couple of weeks. as populations get vaccinated, supposedly, it is meant to severely cut down the numbers of hospitalized and those who have severe illness and fatalities

from the virus, but it will not cut down the case numbers as aggressively. a lot of people might get minor forms of illness. it will be a bit more likely and deming flew -- endemic flu. the one extra qualifier to add is that the difference in singapore this time around is that it appears to be younger people, school kids getting sick. that's very different from last time around. that's why there's a bit of an extra excuse for the caution we are seeing across asia. anna: interesting dynamic when you think about the efficacy of vaccinations. you can get up to date with all the insights from mark and his team, markets live team, go to mliv on the terminal and get all their thoughts. coming up, bitcoin is on a wild ride, as elon musk continues his attack on the virtual currency. we will take a look at what is making the dogefather sour on bitcoin.

we speak to the ceo of metro bank about his calls for regulators to strengthen the banking sector amid the pandemic recovery. as as boris johnson says he's anxious about the spread of a new variant in the u.k., credit derailed future -- could it derailed future reopening deadlines and the summer holiday? if you have any questions for any of our guests, please do send them to us. this is bloomberg. ♪

♪ >> this is going to be a travel rebound like we've never seen, i've never seen in my lifetime.

probably going to be a travel rebound unlike anything you've seen in a century. asia is a little behind. north america ahead, followed by europe, followed by the rest of the world. i expect asia to be a little behind. anna: the airbnb ceo talking about the reopening on the rebound he expects to see for the travel sector. the head of the u.s. cdc, centers for disease control, says fully vaccinated people can stop wearing masks in most settings, both indoors and outdoors. it is the most significant shift in guidelines since the start of the pandemic. the u.k. may bring forward second vaccine doses for millions of people to ensure as many people as possible are fully vaccinated. prime minister boris johnson says he is anxious about the spread of the covid-19 variant originally identified in india. his comments raised the

possibility the government may be forced to slow down its roadmap for reopening the economy. we are joined now by moz afzal, global cio of efg asset management. nice to have you on the program. i wonder how much you are thinking about the various narratives for the developing different parts of the world, the reopening story and full drive it seems in the united states. parts of europe looking to reopen. there is this variant of concern on the agenda. the asia story looking very different. how much is this influencing your strategy at this point? moz: at the moment, not much. i think the general narrative is the same. there will be differences, as we have seen already this year. one month, two months does not make much difference in the grand scheme of things. in our view, may be the reopening trade has probably extended a little bit in the short-term. remember, the reopening trade

really started back in november when we first learned about vaccine rollouts. just around that time, we had the u.s. election results. we have had a good five or six mods of people getting used to the idea -- months of people getting used to the idea. maybe it's a little overextended. we've seen that little bit this morning in the commodity prices. mark: even though it might be a little overextended in the short-term, it seems that most investors are not too worried by some of the stories we are seeing of the virus resurgence. is there kind of any change in dynamic that would get you worried about the virus again? or is it longer-term, it's an extra few weeks before we reopen, the overall trade is good. moz: there's the market perception and then there's the

economic data. the markets have already moved up. there are some dangers certainly for commodity prices, the banks, for example, that they probably overextended. if there is a bit of risk right here, as we have seen overnight from singapore, for example, those can really pull back. in the short-term, we got may the growth stocks that have been generally left behind over the last six months or so, maybe they are starting to come back a bit. we are thinking they are a little more balanced than they were earlier this year or certainly towards the end of last year. anna: you have talked a little bit about that, but if you think about the u.k. context, where we've got piles of savings and aggregate for the nation, a big pile of savings to spend or not

spend, and big assumptions have to be made about what people do with that. what are you expecting that to benefit that has not already been priced in? moz: i would be a lot more cautious there. i think one of the big challenges is that getting staffing, for example, is difficult. this is also the first real test for brexit, and whether people who are in that category who may be left the workforce or have gone back to europe or wherever, you know, getting them back. does that mean we will start to see maybe margin pressure in those very businesses because they cannot get staff back? i think there is some concern. in leisure. , i think there is a little bit more concerned than i think is really priced in. there are going to be some real challenges. i think the hands-down winner, certainly in my mind, is the

consumer -- trade will be more long-lasting. we have started to see impacts on housing, in the u.s. we have a bit of millennial trade coming through. millennials are looking to move into a bigger house, out of town maybe. i think that side will be a lot more extended. we are really focusing on that part of the consumer, for example, the reopening, where we think it's probably a little bit more durable. and also where the savings have pent up, you can't go to the pub to make up for the last 12 months. mark: what is your best expression combining that millennial trade, consumer durable trade and the reopening trade? moz: it would be those consumer retailers, home improvements, that sort of area is where we think, and quite frankly, that

sector for the last decade or longer has basically been ignored. that looks quite interesting, certainly globally. supplies back in china and japan, and obviously retailers in the u.s., probably the better ones, i would say. there's a much smaller group in the u.k.. anna: stay with us. moz afzal from efg asset management staying with us longer here on the european market open. let's get some of the top stories we are covering this morning. here with a bloomberg first word news update is laura wright. laura: thanks, anna. the situation between israel and hamas has escalated overnight. israel ground forces are shelling gaza amid more rockets from the region. the nation is also calling up reserve troops. more than 100 palestinians and seven israelis have been killed. hundreds of buildings across gaza are damaged or in ruins. bitcoin is hovering around $50,000 after more criticism from tesla's elon musk. he says he supports other

digital coins but is signaling bitcoin is environmentally unsustainable. in a separate tweet, he says he is working with the developers of dogecoin to make transactions more efficient. former u.k. prime minister david cameron is defending his intensive lobbying for the now collapsed greensill capital. during nearly four hours of interrogation by two parliamentary committees, cameron denied he was motivated by a big greensill paycheck. investigations are underway on whether senior members of the government gave the former prime minister any special favors. global news 24 hours a day, on-air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. annmarie: laura -- anna: laura wright in london. let's take a look at some of the things on our agenda. at 12:30 p.m. u.k. time, the ecb publishes the account of april's policy meeting, when christine

lagarde pushed back against suggestions that they were thinking of scaling back stimulus. a little bit later at 1:30 p.m. u.k. time, we will have the figures for u.s. retail sales for the month of april. what echoes of that strong cpi number will we see in the data? later, robert kaplan takes part in a discussion hosted by the university of texas school of business. a really interesting bloomberg intelligence report called kaplan: the lone hawk calling for tapering talk. stocks are back in the green. signs of a strengthening u.s. labor market ease some concerns over rising inflation. we will discuss next. this is bloomberg. ♪

♪ anna: welcome back to "bloomberg markets: european open." 40 minutes to go until the start of the equity trading session. looks as if we are going to end the week and slightly better form then we saw earlier on this week. gains of 1.1% on the msci asia pacific. looking at the nasdaq, and over the last -- looking at nasdaq futures, which do suggest we will see some upside. we are still underwater for the week. what are your thoughts about how we started, moved through this weekend how we are ending it, in what seems to be a slightly more positive mood? mark: given the data we have seen this week and given how we started this week, it's a very positive finish. we were a little bit nervous and markets, even before the inflation print. the inflation print came way beyond any of our expectations and therefore should have caused more turmoil. it shows that the buy the dip

sentiment out there is still pretty strong. a prissy positive finish for the week. we still have a lot of the session to go. anna: let's put what we have learned about the inflation story into context with our guest. asian stocks are rising today after a bruising with. above the forecast producer prices have reinforced concerns over growing inflationary pressures but signs of a strengthening economic recovery are helping ease some of those concerns. u.s. initial jobless claims fell by more than expect elastic, marking a new pandemic low. moz afzal from efg asset management is still with us. interesting to see the way the market responds to lower jobless claims. you would think that a different narrative could tell you, that adds to inflation concerns and makes people more nervous about inflation risk. but for whatever reason, the data is taken as a sign that the u.s. economy is actually recovering. this is all ok. how do you contextualize the journey we have been on this week? moz: it has been a roller coaster.

at the beginning of the week, i think market participants anticipated the stronger inflation print. i think and generally expected it, maybe you had a bit of a surprise on the upside. when you talk about big numbers, there's always that opportunity for overshoot and under should. that's the word we have seen consistently over the last 12 months. i think that overshoot came along. expectations have been pulled forward. i think as we enter this new phase, there are some nuances. one thing we have been looking at carefully is looking at u.s. 10 year treasuries and generally stayed in a range over the last month and a half. we have seen more recently, as the reopening trade has accelerated, if you like, the gilt market and the bond market breaking out to new ranges.

there are some nuances here that are actually quite interesting and kind of reflect the, you know, what's priced in already and what hasn't been priced in. mark: we've got an inflation tsunami at the moment but it still does not solve the issue of whether it's transitory or not. are you in the transitory camp or not? when do you expect that we will reach the conclusion on that question? when will we know? moz: it's the billion dollar question. we break it down into three parts. the first is the commodity price move. some of that is driven by the base effect, right. we have had oil prices even negative last year, commodity prices, deflationary forces strong 12 months ago. that has collapsed. when people talk about

transitory, that is the element they are talking about. what damage has there been to the supply chain? i break the supply chain into the labor supply chain and the components for supply chain. component prices are definitely going up. the labor supply chain is also a problem. getting people back to work due to childcare issues, for example, that are still prevalent, that's the second part. the third part, the real inflation, unfortunately, i don't have the answer for you. that's what we will see next year i think. once these things roll off, we really get to see, is this a new paradigm? have we changed what's happened in the last 10-15 years in terms of inflation? mark: i am going to have to put you on the spot. you have outlined the issues well. sounds like you're in the transitory camp. you might change your mind. when do you think we will find out the answer? do you think it's not until the start of next year or later this

year? moz: it will not be until next year. we have to let these numbers run off. expectations on the commodity camp are too high. we think they will taper off to the course of the year and then maybe the narrative will change. and then, we will really look at, what has changed? are we a new paradigm? that's a next year issue. anna: just today, steel down 6%, copper down 3%, incredible numbers. we will talk more about that in a moment. moz afzal, global cio of efg asset management, thanks for spending time with us here. coming up on the program, as the u.k. takes the next step in reopening, we speak to the ceo of metro bank about his calls for regulars to help strengthen the sector amid the pandemic recovery. what is he calling for? what is he expecting to see in the u.k. economic recovery

story? we will also get back to the story on commodities as well. this is bloomberg. ♪ ♪ ♪

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anna: half an hour to go until the last to the upside. u.s. futures point higher. let's think about one of the big drivers of the markets this week. that has been the commodities story. this has become something that can hijack today's trading destiny. let me ask you about the broader context around the size and scale of the moves we have seen in commodity markets this week.

mark: commodity markets have had an incredible year. it has really accelerated. it has been dominating the market screen and the gmm screen most days the past couple months. there is nothing that typifies it more than what is happening in iron ore. iron ore surged to a record high, crazy move. it was doing 5% or 6% every day for several days in a row. 10% at the start of the week. suddenly, at one point today, we are 20% down from wednesday's record peak. you are getting pretty close to going from a crazy record to a bear market. it is kind of crypto-like. it shows what a scale of a move it has been, we are back now around 195, this is a level which was not seen in history before last friday.

we are now treating 15% off wednesday. 15% down as above anything seen this week. it is a crazy market. anna: you see those headline saying we have not seen these level since wednesday. that does not sound very alarming, but it is quite interesting given the size of the moves we have. let's think about another sector in the u.k., the banking sector. the u.k. reopening story and the banks that go along with it. the ceo of metro bancorp on u.k. regulators to boost competition by relaxing rules for small banks. he has warned weakness in the sector will hit the u.k. recovery from the pandemic. we are joined now by the ceo of metro bank. give us your overall pitch. what is it you want you regulators to do to increase competitiveness from a regulatory perspective?

>> it is pretty clear we don't have competition in the sector. five years later we have 1.4% of accounts switching every year. that is a real cost to the economy. consumers end up spending billions more than they would if they had real choice. if we are going to bounce back better as an economy, we need the sector to be part of that growth. the sme sector has less choice and less opportunity than it would if the regulators created a more level playing field. for the mid tier banking sector. at the end of the day, my capital rules are the same as rbs or lloyd's or jp morgan. i am 1/10 the size. anywhere else in the world, our capital rules would be different than they are in the u.k..

even if there is a cost to that. if you want to wrap all the banks in cotton wool, there is a real cost to the economy. consumers spend more and smes can't access debt they need to grow. in our press release we were pretty clear as a midtier sector we could lend another 26 billion pounds in the sme sector if we simply aligned the regulatory rules with the rest of the world. i think it is a problem as we try to grow out of the pandemic. mark: are you worried about competition in the fintech space? has the pandemic changed your perspective on brick and mortar branches for banks? >> really fair question. i would say the fintech's and what i would call traditional banks are completely aligned. when we meet with the bank of england or we send correspondence into the bank of

england, they are signatories to that. this regulatory issue will affect all financial market -- organizations including the fintech. it is a real problem. in terms of branches, we are still committed. we think stores have a big part to play as we come out of the pandemic. our stores in west london have been busier over the last month and a half, two months, then they were pre-pandemic. our stores are still the center of activity. we think it is a great way to look after customers. we spend a lot of money on digital. we want customers to be able to use metro bank however they choose. we think stores have a role to play and we might be an outlier, but we are committed to it. anna: i wonder why you think metro bank needs to make this argument, i suppose, given the

difficulties you have had with regulators in the past. i know this is under other management. but difficulty with risk assessing mortgages was something that got you into trouble. does it feel as if metro bank is the right voice to be say we need less regulation in the sector given that you have had issues sticking to regulation? >> it is a really good point. i really wish i was not here this morning. i don't really enjoy having to put my head above the parapet. i'm not the only voice. the sector is speaking as one. any letters that get submitted are signed by 11 or 12 ceos, which is pretty unusual. the issue is that is time critical. the review of the regime is going on right now. the discussion paper solicited responses and there's going to be a consultation paper in the

next 45 days. this is the moment in time where if change is going to happen, it's going to happen now. if it doesn't, we are probably looking at a noncompetitive market for the next decade. it is a fair point on your part. i would prefer not necessarily to have to do this. but if we want an sme sector to be the engine to grow the economy, it needs to change. mark: fair response. one more tough question around that is in the context of have been reports that investors are very upset by your proposed compensation. what is your response to those investors? >> this is a moment rise of want to be flippant because i need to be careful. listen. at the end of the day, i fully appreciate everybody's perspective. it has been a difficult year for everybody. the bank included. metro bank had a really -- we

had a good year in a difficult environment. the reality is we kept all of our stores open throughout the pandemic. we created more new products than we have in the history of the bank. i get that the financial component is not very good and i understand we are in the middle of a turnaround. in the first year of a turnaround we were always going to lose money. the reality is i did not take any cash bonus so that i am completely aligned with shareholders. if the shares do well, the stock will be worth something. if the shares don't, the stock ramp will be worth less. i genuinely appreciate it, but we did not take cash bonuses so that we could make sure those working the tills in stores could get a cash bonus.

we have done what we can. it has been a tough year, but metro did a lot of good things this year and i think the bonus scheme is a recognition of that. anna: thinking about the broader u.k. economic story, i wonder if you can give us insight into the level of defaults you are factoring in for the u.k., for your customers. you have issued 1.5 billion pounds worth of government guaranteed covid business flows. as we look to the end of furlough, what assessments are you making around the rate of business survival or collapse? >> we put a fair amount of money aside and we are still being prudent. the reality is the mortgage bucket has not seen the level of actual default anybody anticipated. the market has held that much better. there are episodic issues, some of which has been impressed. those businesses would have had

trouble with or without the pandemic. the core has held up really well. in terms of activity levels, we see transactions at the tills starting in april. we are probably in the ve camp more than we are not. the reality is i don't know what stabilization looks like. it seems like we are coming off the bottom. anna: thank you very much. daniel frumkin. thank you for sparing us your time this morning. let's get your business flash. >> disney attracted fewer new streaming customers then expect it last quarter. raising fears it's disney plus platform may be losing momentum. reports of nearly 100 4 million customers at the end of last quarter shy of the 110 million expected by the street.

the results are a rare stumble for disney sending shares lower. beating expectations for bookings, reflecting pent-up demand for travel. the lingering effect of the pandemic are still on display. losses ballooned. >> this is going to be a travel rebound like we have never seen. probably unlike anything you have seen in a century. >> coinbase shares are fluctuating with revenue coming in just below estimates. the biggest u.s. cryptocurrency exchange is currently contending with a crash in the digital coin. it says not to over act the current bitcoin move. coinbase is planning more acquisitions. that is the bloomberg business flash. anna: coming up on the program, bitcoin on a wild ride as elon

musk continues his attack on the virtual currency. ♪

quickly forecasted bitcoin would hit 115,000 this august. it is essentially on pace to do that. it hit all the monthly milestones through april. i do think it could double the next five or six months. anna: interesting numbers, currently trading at $49,000. dan moorehead speaking about the outlook for bitcoin. the about-face from elon musk

still rattling these markets. mark: as respectfully as possible, i would say such predictions or projections, exact numbers, are arbitrary and random. they are not driven by fundamental drivers. it is about how much more money can come in. it is easy to go to 400% when the total market cap was only a couple hundred billion. now that a trillion, if you are saying it's going to double in value, it needs to go from $1 trillion to $2 trillion. it does not need an extra trillion dollars to come in, but needs to be valued at an extra trillion dollars coming in, and that is a much harder move. i don't see doubly happening. anna: it has been a volatile week for bitcoin after those comments from elon musk. he set up his criticism citing environmental concerns.

let's get more detail on this with another take on this fascinating story. your thoughts then on this u-turn we heard about from elon musk? it seems steeper than a u-turn. it was only a couple months ago they said you could use bitcoin to buy a tesla. what was your assessment of what he had to say and why? >> even by elon musk standards, i was going to say roller coaster, but i will go with u-turn. he was on saturday night live promoting dogecoin. he put out a poll whether tesla should accept dogecoin. he put out a statement saying tesla would not be accepting bitcoin until it moves to more sustainable energy. the last 24 hours, he has now said he's working with dogecoin

on improving transaction efficiency. we have seen all sorts of crazy stuff from elon musk. you have to wonder whether he has jumped the shark on this. if this is a hustle, it's not working for tesla. they hold $2.5 billion worth of bitcoin at the end of march. since then it has lost about 15% of its value. tesla shares are down about 15%. the performance on saturday night live over the weekend. mark: the best single piece i have read ever on bitcoin and the environment was this morning. there is this idea that people who say they are going to focus on renewable energy sources for bitcoin is disingenuous. can you explain?

>> in a sense, better late than never. a lot of people have been talking about crypto's carbon footprint for a while. the processing power happens where power is cheap. that is mostly in china. half of that is in changing region. the remainder is split pretty equally between -- those first two regions are very heavy coal powered. the latter two have a lot of hydra. even the hydro powered regions, bitcoin is ultimately adding demand to the grid. the operators in china are still now adding coal power plants to cope with increasing demand. 88 gigawatts is under construction at the moment. there was a study last month that looked at this. crypto is heading toward being 5% of chinese grid demand, an extraordinary number when you consider. it is 350 terawatts hours more

than the uk's annual electricity consumption, and that is providing a mock -- a market, which obviously is not a good idea. some of it will be powered by hydro and wind, but it is not like the u.s. where it is only big silicon valley companies that buy a contract for a new willpower. in china you buy what is on the grid. anna: those who want to speak in favor of bitcoin will say we have to compare that massive consumption of energy with how much the standard banking system consumes, and i will leave somebody better than me to do that. another point you raise, it is not just the mining of bitcoin that is energy intensive. it is the buy and hold strategy, or hodl. why is that something we need to consider from an environmental perspective?

>> this is almost a philosophical issue. if you go back to the original paper that laid out the idea of bitcoin, a central part of the philosophy was the bitcoin network does not just recognize and verify transactions. every time a new block is mined, it is verifying the ownership of every coin that has ever been mined. that is the whole point. one of the points elon musk was making was, we are not going to accept payments in bitcoin and we are not going to sell our bitcoin, we are just going to hold it. as long as they are holding it, he is part of this network. the value that is tied up in that only has value for as long as the bitcoin network is operating, as long as the hash rate is operating, as long as electricity is being consumed to keep it going. anna: thank you very much for joining us.

really great to get your insight into bitcoin and its environmental record. coming up, we will be back to focusing on the market open which is nine minutes away now. we look at your stocks to watch. the company raises its dividends. plan timor to talk about as we work our way toward the start of the final trading day of the

anna: seven minutes onto the start of cash equities trading and futures improving through the last hour or so. we see improvement in nasdaq futures as well. here's dani burger. >> sage group reporting earnings today. the company has struggled because despite the fact its software depends on people being

back in the office, it had a loss the first half, but it is improving the picture for the rest of the year, now guiding toward the top end of its range, boosting its dividends to percent to about six -- 2% to about six pence. we have hospitality opening up on monday in the u.k.. a lot of optimism over that. we did have boris johnson's comments about anxiety over the covid variant that started in india and saying all options are on the table. the other sector to watch is miners. this one has been in focus, but with iron ore and steel under pressure today, these stocks could also be under pressure. anna: thanks very much. dani burger with the stocks you should be watching. we will keep that in focus given the size and scope of the move we saw in commodity prices during yield session over in asia. i was looking at iron ore prices

down another 8%. copper down 3%. stunning moves in one day. mark: i think this is a real potential turning point. most people i talked to are commodity specialists and think this is a temporary pullback, the overall we will go on again. the idea that we will increase the intensification on the debate about tapering and therefore we are due a little bit of a multiweek pullback. overall, this bull market will continue later on in the year. thus the general sentiment. overall it is a positive session apart from commodities and crypto's a bit nervous as well. anna: a positive session despite the mood music or the asian session around the tackling of the virus. pretty negative, restrictions being introduced in some places. thank you for spending the past hour with us. i will be back with the market open up next, futures pointing to the upside, increasingly so.

we try to bring a close to what has been a modest week. ♪

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anna: welcome back to the european market open. a minute to go unto the start of trading. in the u.k., prime minister boris johnson says he is concerned about the spread of a

variant while singapore tightens restrictions. stocks rebound after signs of a strengthening labor market. and a wild crypto ride. elon musk doubles down on his pessimism regarding bitcoin as others chime in on the future of digital currencies. let's take a look at the futures for equity markets. in europe, we see upside. increasingly, things are positive this morning. u.s. futures have been turning more positive as we have gone through the early hours here in europe. nasdaq futures up 0.9%. it seems there is more positive data around jobless cases in the u.s. that was interesting to watch in the way of developing markets. european equity markets, futures suggesting we will be positive

and that is what we see. the ftse 100 up 0.5%. the ibex, up 0.8%. rod moves to the upside. we tailed off in terms of the earnings story. it is been a busy week for earnings and data. the cpi and ppi data and the reflections of inflation in the u.s. and globally very much part of the story this week and it has spooked markets. looking at how broad the rally is, we have many sectors in positive territory. travel and leisure is a best-performing segment. the only sector in negative territory is a basic resource sector down by 0.25%. that is no surprise given the ongoing selling we are seeing in some of those commodities. in the asian session and now into europe. european equity markets opening to the upside. the french market up 0.7

percent. let's reflect on where we are in the covid fight. u.s. is taking its biggest step yet in its return to normal. fully vaccinated americans can ditch their masks in most places. a different story in the u.k. as a government may bring forward second vaccine doses for millions of people to ensure it is many people as possible are fully vaccinated as johnson says he is anxious of the spread of the covid-19 variant first identified in india. let's talk to berridge patel. we have different dynamics around the virus in different regions of the world. u.s. seems to be full throttle with its reopening story and we are seeing that in the mask narrative and the vaccination of adolescents. and in asia, they also have lower vaccination rates and we are seeing some clamp downs and return to lockdowns in some parts. how do you think about all of those different and competing

directions when it comes to your own virus? and the path out of the pandemic? viraj: i think to be honest what we will expect in the next couple of years is a multispeed economic recovery around the globe. there are a lot of short-term factors distorting expectations but really, globally speaking, when you think about the topside in yields, there is room for correction in the short term given the constructive narratives around the reopening on the global growth and the outlook. it looks like a lot of good news is already priced in. these tactically could see moves around the inflation expectations. and certainly from our view, that creates a shuttered view. and we would be biased of any of the text selloff. anna: it does not seem like the

virus story is dominating the market narrative. it seems more around fears of inflation. what we are seeing around the virus, do you think it then gives growth a chance to come back? viraj: i think so. a key thing and driver of markets in recent months has been inflation expectations. i think that is the story. and i think the knock on effects in the equity market, look vulnerable in the short term basis. anna: i wonder what you make of the semiconductor space. it is part of the tech story that many people thought might benefit from a shortage of supply but maybe that has not been the case.

it seems we have seen plenty of option bets against the semiconductor sector and this was part of the text selloff we saw earlier this week. is that a sector that catches your eye or that tells you anything about the macro picture from here? viraj: from a first-order perspective, the rally in semiconductors and supply shortages is well-known now and we have seen that in the positioning perspective. the knock on effect in the automotive sector, we expect a good couple of months. that is the first place where our positioning models show vulnerability. anna: incredible charts on

option traders flocking to bet against u.s. chip stocks. an explosion of exposure on that front. viraj patel will stay with us on the program. coming up, stocks are back in the green signs of a strengthening labor market. we will discuss that inflation narrative next. this is bloomberg. ♪s is bloomberg. ♪

anna: welcome back to the european market open. eight minutes into our trading session and things looking positive. in terms of the sector breakdown, we were seeing some underperformers in the basic resources sector. elsewhere, moves to the upside. let's get some individual movers. dani: sage moving to the upside. seeing the full year profit toward the upper end of their guidance. i'd is inciting positivity. jp morgan raising their guidance on the stock as well. it is also interesting to see the next stock i have for you moving higher and that is the grocery delivery service, ocado. you have to wonder if people are

bidding this up in anticipation of more restrictions. including boris johnson's concerns. i wanted to pick out one of those basic resources stocks were talking about. i feel like i have talking about rio tinto every day this week because it has been under significant pressure at the slide in some the commodity prices like iron ore. it is not just rio tinto. the entire space. any sort of the materials, basic resources, energy and oil seem to be under pressure today. anna: rio tinto up 13% year to date despite today's negativity. stocks are back in the green today after a bruising week. above forecast producer prices in the u.s. but signs of a strengthening economic recovery are using some concerns.

jobless claims fell by more than expected last week marking a new pandemic low. viraj patel is still with us. i wonder how you look back on this week and what we have learned around the inflation story given the blowout cpi and the market reaction that resulted. viraj: it is important to remember that this month and right now, it is somewhat of a perfect storm for inflation. not only do you have the basic facts, but you have these one-off monthly numbers. and that is distorting short-term inflation outlook. this is a unique period for inflation. these dynamics are unlikely to persist. the short term challenge is that you will continue to see some of

this fall -- volatility. both of these will be challenging to gauge but broadly speaking, take a step back. we have paid for some of these short-term inflation expectations. they are pressing in. we think it is a good opportunity to focus on that narrative and that is the real story that offers some upside to the growth versus value debate. anna: we fade the inflation story you think. think a lot of what we are seeing is base fx. you don't think we will see inflation take hold in a more fundamental sense. viraj: it is very one-off. the challenges that we have not just base fx but a reopening to contend with them both will be transitory to some extent. it will be more spread out than

we are used to when it comes to base fx. that is the factor. not just the markets but central banks which make short-term reaction functions to policy uncertain. the key point is that when you look at the rising inflation expectations and when you look at some of the premium price -- premiums priced in, the further upside looks slim. that is the narrative. i think we will probably get a better read on inflation and data as we go through the rest of this year and the chances of us surprising even to the upside per where markets are currently priced is very good. anna: i wonder where that goes with the commodity story because i know in developed markets, the impact of commodity prices is limited in terms of how it relates to cpi. it is not the big driver. look at where commodity prices

are now versus where they were a year ago, there are base fx but i'm looking at popper for example. $462 right now, way above the levels it had that in 2018. surely, that goes somewhere. viraj: i think it will have some underlying price pressures. we are seeing that in some of the components. but the real thing for inflation expectations to sustain at this level in the short-term, when you look at a three year, you are paid more. you need another like higher in commodity prices and oil prices. that is not impossible but in the short-term given how far these commodity prices have rallied, the risks are -- when

you think about inflation in the short-term, the first leg move -- back then, we saw the rise in expectations. anna: ok, thank you for joining us. he will continue his conversation with us on bloomberg radio at 9:00 a.m. u.k. time so i look forward to speaking to him on bloomberg radio. coming up here on this program, president biden hales what he calls rate milestones as public health officials say fully vaccinated americans can stop wearing masks. we'll get the latest on the science. this is bloomberg. ♪

anna: welcome back to the european market open. we are 17 minutes into the start of the european trading session. things are looking positive. we are seeing gains, travel and leisure stocks doing well. disney attracted fewer new streaming customers it expected last quarter raising fears that the disney plus platform may be losing some momentum sending shares lower in extended trading. we spoke with the ceo of

chadwick starting the conversation about the streaming mess. >> we have now -- streaming miss. >> we have launched and have not been disappointed in terms of the uptick in subscribers in each of those markets. they have executed differently and different pieces of the world -- in different pieces of the world. regardless of that diversity of how we have gone to market, we have been thrilled across our general entertainment platforms which is the plus platform as well as our disney plus platform. very happy with it. and the uptick across all markets. >> you ran the parks for many years and we are hearing so much talk about a huge summers surge. -- summer surge.

how big a demand are you expecting? >> we are encouraged in terms of what we are seeing in current attendance as well as bookings. and in terms of the cdc requirements in terms of masked relaxation, we think that will put more people in our parks or like what we are accustomed to. future bookings are looking great. in walt disney world, they are ready back up to fiscal year 2019 levels, pre-pandemic. that would be the greatest barometer of all. in terms of the assurance that disney has built up with its guests that we will be responsible. there is a craving. i saw this on main street, not only for our guests but for our cast to come back and be part of this social experience.

to experience that magic with your friends and family. >> of course, as you mentioned, the big news from the cdc but we are waiting for children to be vaccinated. will you start letting employees go mask free and the park or customers in general? >> we are still digesting the guidance even a few hours ago but we do think that is in their future process, the near future which i think will make for a much more comfortable experience this summer. >> let's talk about florida. florida has lifted all restrictions. i am curious how far you are from one hundred percent capacity and will you get there before the end of the summer? >> there is a variety of guidance we have taken since the pandemic started. we have national guidance from

the cdc, health officials from the state, the governor of the state, local mayors and everyone comes to what seemingly is the same realization now over the last couple of weeks. that it is safe to reopen. people do not need to wear masks. social distancing requirements are evaporating right before our very eyes. and i think that gives us the ability to create that sense of community in our parks and bring back some of the experiences that we have had to put a hold on like parades and fireworks and meet and greets with our characters. that is part of the big disney experience and we are just thrilled that the cdc has come to this point even the increase in vaccinations, the decline in case rates and the general sense of people are now willing to travel and we see the consumer confidence in our research growing whether it is the willingness to jump on a plane

out mostly to be willing to come back to the park and feel comfortable doing that. anna: that was the disney ceo speaking to emily chang about the company earnings and the steps they are taking to keep their parks open. he is obviously enthused about the guidance from the cdc. the latest guidance from the cdc and the u.s. is good news for businesses such as disney. it has lifted post died in's of mask wearing for vaccinated individuals. president biden welcomed at the guidance calling this a historical and logistical achievement. the cdc coming out with this new guidance on mask wearing. what is your thinking on this because ever think the vaccination program started rolling out, there is only 41% of the population vaccinated in the u.s. a lot of people have been asking questions about what kind of rewards you would see for being vaccinated? is this one of them? >> of course it is.

everyone wants to get away from the more important thing which is social distancing which is impacted by the virus. but masking is one of those things that has been a problem for some people. i suspect this will make quite a few people happier. and get as back to some form of normality. anna: a lot of people hoping for a little more reality. some retail consultants saying it puts them in a difficult position. retailers won't know who has been vaccinated and who will not -- and who has knopp you are you will have to leave this to individuals. -- you will have to leave this to individuals. >> those that are vaccinated, when they are together, should not have to wear a mask. you are going to have to be putting trust in people which is what we have been doing anyway to a degree in terms of quarantines.

hopefully, people will not abuse it because they have learned that it will put us back into the same hole again. anna: thinking of things that make us nervous. boris anxious about the variant found in india. your thoughts on how much of a roadblock this might be or might not be in terms of opening here in the u.k. >> i am just as worried. the issue i see is a problem we have to deal with sooner or later is that if our decisions about how our roadmaps in any country are based on case counts of variants that can bypass the shield at the vaccination

gives seo, if that is what the new metric is, we have a new problem. the expectation is that vaccines would prevent severe critical disease but they may not be as good against some variants when it comes to mild infections. anna: do you think you would say that we are going to get outbreaks and as long as that is something that does not send people the hospital, we just have to carry on? >> that is one way to think about it but i think we need a lot more discussion and analysis as to how you manage these local outbreaks. can you actually have those regional tier systems back again? and you have to enforce them. i think it is a difficult roadmap ahead. anna: we will see at this conversation moves apace in the

coming days. good to get your perspective. bloomberg spoke to coin base -- coinbase president. we will hear him that exclusive interview. elon musk and his u-turn on cryptocurrency talking increasingly about the environmental impact. this is bloomberg. ♪s bloomberg. ♪

anna: welcome back to the european market open. a half an hour into our session. european equity markets pointing to the upside. it is broad-based. we see they ftse 100 up zero

point 6% despite some weakness in the mining stocks. the dax and the cac trading at a little less to the upside. the ftse gaining the most regardless which is interesting. retail and insurance to the upside. travel and sector was dominating to the upside in the early minutes of the trading day but that seems to have given way to a retail push. more sectors to the upside. some of those most beaten up bouncing this morning. let's get a bloomberg update. laura: the u.s. is taking the biggest step yet in its return to normality. public health officials say americans that have been fully vaccinated can ditch their masks in most places including indoors and in large groups. the president says it is a great day in the long battle with coronavirus. the situation between israel and

hamas has escalated overnight with israeli ground forces shelling gaza amid more rockets from the region. the nation is calling up reserve troops. more than 100 palestinians and seven israelis have been killed and buildings are damaged or in rowan. former u.k. prime minister david cameron is defending his intense lobbying for the greensill capital during nearly four hours of interrogation by two parliamentary committees. he denied he was motivated by a big greensill paycheck. investigations are underway over if senior members of the cabinet did the former prime minister any special favors. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. anna: laura wright and london. the largest u.s. current -- u.s. crypto exchange of plans to offer dogecoin.

emily chang spoke with the president of coinbase. >> the crypto economy is taking off and coinbase as a platform is taking advantage of that opportunity. it is cool to see this wave of activity not only from retail users but also institutions. we had seen it in droves before. what you're seeing is there is a lot more credibility in the space. we have high-quality institutions. >> you have been a public company for a few weeks now. a huge debut. a lot of volatility in the crypto space in general but also in coinbase shares. what has it been like being a public company and what you make of the volatility? >> it is a future. not a bug. we were operating as a public

company internally for so long, we are so used to this. we are looking at the long-term. these blips don't phase us. you are looking at the long-term opportunity and you buckle up and go for it. >> you are not providing much financial guidance. why is that? do you foresee a time that you might provide guidance? >> it is about, this is a new nascent technology shift much in the same way that the internet took a foothold and changed people's lives fundamentally. with this tectonic technology shift, you will see volatility. we are not going to play the game of short-term issues, we are playing a long-term game. i cannot foresee us doing the guidance thing because we think of this as an industry that has

an incredible opportunity. >> you cite the market uncertainty as part of the reason for limited guidance. what are the biggest question marks for you when you look at the market ahead? >> it is about how do we create the most user-friendly experience for folks? in many ways, i use the analogy of the old mobile phones. clunky interfaces. we are in that phase of crypto. we have to make it more usable and accessible. we have to have more regulatory certainty for more folks to get off the sidelines and participate. we are seeing so much participation now, we feel this is a great opportunity ahead of us. >> elon musk abruptly announced

tesla will stop accepting bitcoin as a form of payment. crypto markets losing hundreds of millions of dollars on the back of that tweet. what is your take on that? >> there is so many misconceptions about the space. only 75% plus of miners are using renewable energy to mine. i welcome elon and brilliant minds like his. we are seeing that we are moving to a proof of state mechanism. when they do that, that is the way we are driving more renewable energy. in any case, i want to say that i do think there are a lot of other industries and devices that consume a lot more energy than bitcoin so you have to look at it from the perspective of

christmas lights and dryers. we want elon to participate and i would not be surprised if there was something bigger behind that. anna: the president of coinbase speaking about the future of cryptocurrency. coming up on the european market open, count down to the holidays after months of pandemic restrictions. england is due to reopen indoor hospitality. there are still some rules on may 17 we speak about summer bookings from the ceo of international hotel investments that operate corinthia hotels. this is bloomberg. ♪otels. this is bloomberg. ♪

anna: welcome back to the european market open. 8:39 in london. gains moderating little across the european equity markets. we are seeing gains but not as strong as they were. similar for u.s. futures. nasdaq futures up zero point 6%. u.k. ministers may bring forward second vaccine doses for millions of people as johnson says he is anxious about the spread of the rearing it first

identified in india. -- the spread of the variant first identified in india. >> there are meetings going on today to decide what we need to do. there is a range of things we could do and we are rolling nothing out. anna: let's get more from dani burger. is boris johnson setting the groundwork for more restrictions? dani: he has broadly said he cannot rule anything out. the discourse has revolved around the vaccination program. do we need to have surge vaccinations? do we need to step up the pace of second doses? he has said there is no evidence that we cannot go ahead with the reopening of indoor hospitality on monday.

politically, it is difficult. those in his party do not want to see any backwards movement in terms of the roadmap. he says nothing is ruled out so there is june 21 supposed day when we get the release of some of the social distancing restrictions. besides that, it is difficult timing because with the reopening on monday, that could speed up transmissions and cause more virus cases to emerge. anna: you have been tracking the economic and corporate impacts of the slow reopening. dani: the latest data we got from the u.k., it is abundantly clear that the reopening helps the economic picture but more than anything, it is uncertainty that hurts corporations and companies. there is a cost to getting ready to reopen and over this past earnings season, we have heard

from company after company and the u.k. talking about how their forward guidance has a lot to do with the release of restrictions. greggs' shares rallied after the restrictions -- if there are more restrictions, they will have to secure more liquidity and very u.n. used the roadmap, the opening of restrictions into their fiscal year 2022 guidance. this is important for companies to figure out what the road ahead looks like in order to give investors weather forecast is ahead from here. anna: a lot riding on these decisions. england will reopen its indoor venues on monday and people will be able to stay in hotels after one of the longest lockdowns in the world. international travel will be allowed again with various restrictions based on whether the government rings a country

as green or red. there are very few green countries. the eu is looking into vaccine passports to restart it's a crucial summer travel. let's speak to somebody that perhaps hopes they will. simon naudi is the ceo of international hotel investments which operates carinthia -- c orinthia. let's talk about your immediate expectations. you are getting ready for the reopening on monday in the u.k. what are your hopes and expectations? simon: judging by the reactions we have been getting in terms of bookings, we are very bullish. a hotel does not just thrive on its restaurants but also its rooms so the opening of the u.k. to other markets is equally important. and look, it has been a tough

ride for the past year but we are still very optimistic and we look forward to the next few months. anna: there is some international travel allowed but it is very restricted. what are your expectations for what your customer base will look like? will it be a domestic customer base more so than it has been? simon: for sure in the immediate term. even in 2019, 20% of our guest were from the u.k. and 30% of our customers will be from the united states which is the next big market we are looking out for. and the rest will be from europe and the middle east. as the restrictions are lifted and is travel becomes easier and the issue of vaccine passports and testing become clearer -- nobody is expecting the rest of this year to be at the levels of

2019 but it is a start and certainly by next year, we will be back to where we were pre-ben deming in terms of the trajectory of guests -- pre-pandemic in terms of the trajectory of guests returning to the ok -- to the u.k. anna: policymakers are thinking about what they will do next and the prime minister says he leaves everything on the table. what words of caution would you give about your industry and its ability to survive if we saw delays to the timetable or local lockdowns? simon: it is a combination of things. across europe and in the u.k., we have had tremendous support from governments in terms of subsidies to keep our cash flows going and even the banks have been supportive. on the other hand, we do not want to rush to a reopening that

will lead to a closing down again. we had that experience last summer in some countries which is far worse. we support fully whatever the government directives are. we will follow them religiously. and let's take it step-by-step. anna: and thinking about the reopening story, how normal an experience will it be if people come to your hotel or u.k. hotels in general versus what they would be used to? what measures have you put in place? simon: hopefully, as normal as it always was except for enhanced cleaning regimes, social distancing. but people want to travel. there is a huge pent-up demand. we see this in our london hotel but also in some of the resort destinations. i am speaking to you from malta which is beautiful and sunny

today awaiting for the return of tourism here. we are very much looking forward to the rest of the summer and hope to give an experience that is safe and every country has its own rules and restrictions that we just follow the directives we are given. anna: you say you're speaking from malta and you have a hotel they are. you have hotels in prague, lisbon, hungary and parts of africa as well. as you look ahead to the summer, where are you most excited about and where do you think will struggle a little? simon: you mention russia. our hotel is in st. petersburg. a beautiful city. half of the guests have always been russian and that hotel is up and running and as busy as ever and even meetings are taking place and large --ish conferences.

hardly any case is recorded here and malta so we are literally waiting to see what the feeder markets will tell us. we are looking forward herein malta -- here in multi-. we will not see the numbers of 2019 but it is a good start. anna: you are looking forward. you operate at the luxury end. do you have any thoughts on whether it will be luxury that will bounce back or the more budget end of the spectrum? a lot of people, those that have been lucky enough to accumulate a pot of savings might be looking to treat themselves after a year and a half that we have had. simon: clearly, the expectation is that the luxury sector will bounce back on the leisure side of the business will bounce back before the budget sector. it is the shared view of many in

the industry. corporate travel might be more different because corporate travel will be more restricted as companies have cut budget and there are policies within companies on travel which are restricting certain travel from taking place but on the leisure side, we do see huge pent-up demand that will be coming back perhaps sooner than other parts of the market. anna: thank you, simon. enjoy that sunshine in malta. send a bit of it our way. coming up, too much too fast. the macro view of limburger -- of bloomberg market lives then ran. ♪

anna: welcome back to the european market open. we are 53 minutes into our trading day. the german dax up zero point 2%. still positive. the ftse 100 hope -- holding up fairly resilient despite the selloff in basic commodities.

joining us now is a bloomberg strategist. what is the link in your analysis between where we are on stocks, the underlying economic story? >> the process shows that the compounded annual growth rate on stocks is up 5.9% while the global trade of the u.s. economy has been 6.4% historically. what does that prove? capital gains and -- what we have seen in the past two years are gains of almost 30% and 60%, how do you get an appreciation of that magnitude when the economy is shrinking? investors should expect annual price appreciation of less than 5% on average in u.s. stocks in

the coming years. anna: does not have anything to do -- that does not have much to do with the assessments around how high interest rates go? is that taking into account a higher tenure -- 10 year? >> the higher the interest rate, the lower the stocks will go. i think if you get 12% of 225 on the 10 year yield, stocks will --. [indiscernible] anna: let me ask you about the question of the day. when ken cryptocurrencies reach mainstream investing? mark cudmore was speaking about

how iron ore prices have been trading like crypto in the last few days and that is fascinating. you think about how a lot of people might stay away from crypto because of the volatility and you look at underlying commodities that have been with us a lot longer and are part of the investment mainstream that are also very volatile. your thoughts on crypto? >> cryptocurrencies -- for them to become mainstream, two conditions need to be met. we need some intrinsic value and the other thing is that central banks need to embrace the idea. the big issue with all of the cryptocurrencies is none seem to have an inherent or intrinsic value. while people -- the transactions are based on what i can buy today and sell it at an even higher price tomorrow.

that is not to say that the underlying process does not have value and that is where the central banks come in. if it comes -- if they come up -- anna: thank you so much. that is it for the european market open. surveillance early addition is up next. keep focused on the markets. nasdaq futures up. misty london. this is bloomberg. ♪ s bloomberg. ♪

>> there are a lot of other devices. >> anyone who is fully vaccinated can participate an indoor and outdoor activities without wearing a mask or social distancing. >> we are anxious about it. >> this is "bloomberg surveillance: early edition" with francine lacqua. francine: good morning everyone. welcome to "bloomberg surveillance: early edition"