Speaker 1: Global business news twenty four hours a day. If Bloomberg
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Speaker 1: this is a Bloomberg Business Flash and I'm Cameron Moscow.
Speaker 1: US dot Indise futures are a little change this morning.
Speaker 1: Let's go to the First Word Breaking news desk for
Speaker 1: today's morning call, and here's Bill Maloney. Good morning Bill,
Speaker 1: Good morning Karen. That's right. US futures are now trading
Speaker 1: little changed as crew features fade from their highs. Down
Speaker 1: futures hied by eight points, recipes are unchanged, and Nazak
Speaker 1: futures are lower by two. Shanghai plung six point four
Speaker 1: percent overnight as money market rates surged, while up markets
Speaker 1: are trading higher Land by two percent, gains in France, UK,
Speaker 1: Italy and Spain on the US economic front. At eight fifteen,
Speaker 1: fed's Lockhart speaks in Atlanta at a thirty initial jobs
Speaker 1: claims and durable goods orders. At ten thirty natural gas
Speaker 1: storage change, and at eleven o'clock Kansas City FED after
Speaker 1: Dibilis night's salesforce boosted your views trans Ocean Beat and
Speaker 1: Restoration Hardware Q four Polimer EPs missed estimates, shares her
Speaker 1: down twenty percent pre market regard airings this morning, Domino's Pizza,
Speaker 1: an Vesti on beat, Coles EPs beat, revenues, war in line,
Speaker 1: and Best Buy Q four EPs beat, although comps sales
Speaker 1: missed estimates. Finally some ye early while Sheheet upgrades and downgrades.
Speaker 1: Advisory board race to Bibs, sold over at Deutsche Bank,
Speaker 1: Cooper Tire raised to neutral versus Celicalman Sachs Charter race
Speaker 1: to ovod a JP Morgan, and finally Restoration Hardware cuts
Speaker 1: a sector way to keep bank and cut to neutral.
Speaker 1: Over at Robert Baird Live from the First Breaking News
Speaker 1: Desk on Bill Maloney, Karen, all right, thanks Vailla to
Speaker 1: hear live breaking news over your Bloomberg type squawk and
Speaker 1: go on your terminal. That's s Q you a w
Speaker 1: K go and s a Bloomberg business flash, Tom and
Speaker 1: Mike Karn, thanks so much. Bloomberg surveillance. This morning is
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Speaker 1: more and Investco dot com um slash high conviction, giving
Speaker 1: us perspective on the United Kingdom economy. All of the
Speaker 1: uproar over a brexit is John Wraith of UBS. John,
Speaker 1: if you were to have on one on one with
Speaker 1: the Chancellor of the Exchequer or the Prime Minister or
Speaker 1: other elites of England trying to keep the nation within Europe,
Speaker 1: what do you think you would hear? What's the number
Speaker 1: one sales pitch from elites to do no harm? Um? Well,
Speaker 1: I mean you know that the the argument has raged
Speaker 1: in one sense or another for many years in the
Speaker 1: UK about the relationships with the EU. I mean, I
Speaker 1: think you know that the British people generally want convincing
Speaker 1: that staying in it's going to be better economically, um
Speaker 1: in the medium and long term. And that's something which
Speaker 1: is an argument that not hasn't always been been clear.
Speaker 1: And obviously, as we've been talking about already today, over
Speaker 1: recent years at least the UK has been growing much
Speaker 1: more dynamically and rapidly than the rest of the EU
Speaker 1: and so near the Eurozone, so that that argument is
Speaker 1: a difficult one to make, which I think explains why
Speaker 1: opinion balls have been have been pointing to such a
Speaker 1: close outcome. One of those things like trying to convince
Speaker 1: people trade is a good idea because it's easy to
Speaker 1: find a picture of the guy who's out of work,
Speaker 1: and much harder to the dispersion of benefits. Yeah. And
Speaker 1: you know, again, as as with everything to do with
Speaker 1: this reference, and there's two sides to every argument. And
Speaker 1: there are a lot of voters in the UK who
Speaker 1: feel threatened by the open access to the UK labor
Speaker 1: markets for other EU citizens. But but equally there are
Speaker 1: some who see the sort of efficient labor that they
Speaker 1: bring with them and the wider economic benefits that arguably
Speaker 1: are delivered. So you know, these things we'll keep raging.
Speaker 1: And that's one reason why we and most people think
Speaker 1: that the debate is going to remain up in the
Speaker 1: air until the day of the vote itself, which will
Speaker 1: will probably continue to undermine sterling among other things over
Speaker 1: the coming months. Uh. We always talk about a currency
Speaker 1: being weak or strong, as if strong was good and
Speaker 1: weak was bad. What's going to be the impact on
Speaker 1: GDP in the UK from a weaker sterling? How long
Speaker 1: is the jcurve effect? Yeah, well, I mean that's that's
Speaker 1: one of the ironies in this is that as long
Speaker 1: as the fall in the pound is reasonably stable and orderly,
Speaker 1: it's actually got a lot of benefits to bring to
Speaker 1: the UK. We're in a situation where global demand, as
Speaker 1: we discussed before, is potentially slowing, and therefore, you know,
Speaker 1: for for for trading markets, having a more competitive currency
Speaker 1: might help tap into that lesser overall demands. Um. The
Speaker 1: UK also, in common with a lot of other countries,
Speaker 1: has inflation well below the central banks target and and
Speaker 1: a and a weaker currency should raise imported inflation, so
Speaker 1: that there are certainly some benefits to the lower level
Speaker 1: of sterling. But it does smack of a loss of
Speaker 1: investor confidence and some overseas investors taking or slowing their
Speaker 1: investments into the UK because they're worried about the outcome.
Speaker 1: So you as long as it doesn't become a protracted
Speaker 1: and rapid for starting to call into account into question
Speaker 1: the current account situation, then you know there's certainly it's
Speaker 1: certainly not all bad to see sterling weaker. For sure,
Speaker 1: this um going to change the calculation for the Bank
Speaker 1: of England at all. Well, they're very careful at the
Speaker 1: moment not to sound to opinionated one way or the other.
Speaker 1: They obviously can't comment on such political events as a referendum,
Speaker 1: other than to say they're aware of it, and they
Speaker 1: did say that they think it's one of the reasons
Speaker 1: behind the weakness of sterling. But they will wait for
Speaker 1: the outcome and they will react accordingly. And if, as
Speaker 1: in our view, the UK stays in the EU recovery continues,
Speaker 1: lost momentum returns, then we see they'll very quickly tell
Speaker 1: the market that it's got too dubbish and too concerned
Speaker 1: about the outlook. Fifteen seconds, what's your calling Europe when
Speaker 1: you're just a dovetail that was sterling. Um, Well, we're
Speaker 1: more upbeat on the outlook for the for the Eurozone
Speaker 1: than than the consensus. We think growth fair is going
Speaker 1: to be a bit quicker. Um. As far as the
Speaker 1: sort of euro sterling exchange rates concerned, we see it,
Speaker 1: you know, potentially ending this year, not far from current levels,
Speaker 1: but big, fairly volatile in the interim. January is exceptionally valuable.
Speaker 1: Thank you so much. What a primer on all that's
Speaker 1: going on, you know, the Kingdom. And I need to
Speaker 1: give a shout out to Francine McQuire who was way
Speaker 1: out front of this, Michael. She told me in Davos
Speaker 1: before Darva's time, it's gonna be a huge deal. You
Speaker 1: Americans don't get it. She was totally right, big deal.
Speaker 1: I'm not sure Americans didn't get people. Excuse me, I didn't,
Speaker 1: But then I didn't get red stacks. I mean, it's
Speaker 1: almost the time a year where I have to try
Speaker 1: to gauge at I done with the Red Sox in
Speaker 1: late April or early day. I'd give them to me.
Speaker 1: They maybe have fixed gotten the team better. That's the
Speaker 1: pound euro cross, euro sterling. We'll quote that some more.
Speaker 1: I'm so I've been remiss not to quote that. What
Speaker 1: I can quote flat euros yields are infractually one seventy three.
Speaker 1: I'm gonna call it a quiet tape. Oil churrance there
Speaker 1: thirty two on American oil Brent cr right now down.
Speaker 1: Uh since Michael mentioned euro sterling uh point seven eight
Speaker 1: nine four pence, it's like Michael Pence Nobel laureate, they
Speaker 1: had one twelve fifty three. Stay with us, We're pun friendly.
Speaker 1: On Thursday. Bloomberg surveillance coming up there, with all due respect,
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