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tv   Bloomberg Markets European Close  Bloomberg  December 29, 2020 11:00am-12:00pm EST

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alix: live from new york, i'm alix steel, counting you down to the european close on "bloomberg markets." brexit deal, the good and the bad. >> the european parliament will vote at the end of february or the second week of march. this is still to be decided, and talks are ongoing with the commission of the number states, but also the british side. alix: europe pushes out the timetable to approve a deal, while u.k. stocks fly higher. the eu and china near an agreement on investment, seven years in the making, and could be a steppingstone to a trade deal. and waiting for the next vaccine. u.k. should approve the astrazeneca treatment soon as the market seems to fade the vaccine news with each shot. let's check in on the markets. this is an important day, the first time where u.k. assets have a real ability to react to that brings a deal reached on christmas eve, and the result is
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that equities are flying higher. most every sector, particularly materials and industrials qamar really exposed to trade. ftse 100 up by almost a full 2%. yesterday the cable rate was lower, and everyone was kind of strachan -- kinda scratching their heads why. we are reversing those losses on sterling today. eurosterling pretty much flat despite the fact they are getting a nice pop against the dollar, hitting its highest level in all of this year, and buytrade is going to be gilts. it is definitely a risk on trade for the brexit deal. the question becomes, can it last? what individual sectors could still be? a lot of question marks over that. the u.k. is poised to approve the covid-19 vaccine developed by astrazeneca and the university of oxford, given the country get another powerful
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tool to fight the pandemic. want to get some more insight on how the markets are dealing with that. torsten slok, chief economist at apollo global management which has three and $16 billion under management, joins us now. what do you think the market ?ensitivity is now we out the third kind of vaccine shot to get this approval industry vision. -- approval and distribution. n: brexit has become clear, the fiscal stimulus has become significant likely rhythm what it was just a few weeks ago, and with those two things away, we are still spending a bit of time on those issues, but with less of a risk, the focus is indeed on the vaccine rollout. so far, over the last two weeks, since we started doing vaccinations, only 2 million people have been vaccinated in the u.s., so you can quickly figure out that at that rate, they are going to take a lot longer than the market is
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expecting at the moment. the focus will be on the acceleration we are seeing in january in terms of the number of you getting vaccinated. ultimately, will we see the economy come back faster than what everyone at the moment has been expecting for quite some time? alix: does that mean the catalyst is actually to the downside now when it comes to vaccine news? torsten: it has been a little bit surprising that we have seen this slow speed of progress in the number of people being vaccinated. 2 million in the u.s. over the last two weeks is not particularly impressive, so it is the case that we need to monitor very carefully the speed with which vaccinations are rolling out. that being said, the upside risk for consumers is very strong. the economics is clearly that income is getting better with fiscal stimulus, the wealth levels from home prices and what is going on in the stock market is very high, and the pent-up demand in the economy both from savings and checking account,
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also savings when it comes to household savings over the last eight or nine months is also very significant. so the outlook is very promising, so there are good reasons to upgrade, but at the moment, it is really critical that the vaccine rollout is going very quickly, and should come very soon to meet the expectations from the markets here. alix: so if we do get the vaccine rollout, do we see higher yields? where do we see them? i am trying to get a read on what do we have priced in markets and how much juice is there left. torsten: this is a really important discussion. the traditional way of answering that is how do yields come with higher inflation? the fed is clearly saying we were not see higher inflation in 2021. if i take a look at my bloomberg screen, consensus expectations are 1.7%, so that says that we do not expect high
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inflation in 2021. that doesn't mean that long rates cannot go up. lung rates can go up for other reasons. it can go up because of more treasury issuance, because of the dollar going down. it could also go up generally speaking because this sediment is that we are normalizing, and rates have to normalize to the levels that we had of the beginning of this year, but it is very important to discuss why is it we would inspect long rates to go up because inflation clearly is not the fed's expectation or the consensus expectation because it should be some of the other reasons why long rates should be moving higher. alix: does that mean any sort of movement on that end won't be synchronous? that it will be idiosyncratic more to the usi versus we are vaccinating, it is a global recovery, we are going to get back to pre-2020 gdp, all yields go higher? torsten: that is really important also because with the rollout of vaccinations and this bike we are seeing in the number of cases at the moment, it is
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very clear that those countries that have the virus most under control is china and the neighboring countries, where we have seen more normalization than elsewhere. those regions that first get things under control should be expected to also see rates go up more and normalize more muscle in that case, the pecking order here is that china has normalized first. the u.s. is now probably the second part of the global economy that will normalize. then we have europe and ultimately emerging markets coming along, so with that delay in the sequencing, you should also expect to see rates go up in the u.s. consensus from the bloomberg screen expects tenure rates going into this year will be 1.25%. that is not much higher than where we are today, and that is probably because of the outward inflation being so dampened, so the answer to your question is there's a clear list of where we will see recovery first, that should probably also be driving
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differences between how quickly rates go up around the world. alix: does that mean the better the recovery equals the better the fiscal multiplier, equals we could see central banks and governments in those corresponding countries tap the brakes a little bit? torsten: i think that is a glassy right. i don't think we will see any central bank's around the world tight monetary conditions, even in china and in asia, and deftly not in the u.s. and europe? -- the u.s. and europe. that being said, we should not forget that we started out this year with 10 year rates at 1.90%, and with that backdrop, we should also think about, even if we have some normalization, we should expect to see tenure rates go up, but i do think the dampener here will be the lack of inflation and also the very clear message from the fed that we do not see any reasons to hike rates forget to 2023, so we need a spectacular recovery.
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with think about how my jobs have been more permanently destructed. in the restaurant industry, we have seen 17% of restaurants close in the u.s., about 110,000 businesses that have closed. those are not going to come back very quickly. that is why a lot of the jobs that we still need to create, we need to create about 10 million jobs before we get back to the level of employment we had in february. a lot of the jobs we have lost are probably not going to be john -- going to be gone at least through 2021, so the long answer to that question is i think was to have dovish banks through 2021, and for investors that means demand for yield, investing in impacts funds, themes that still benefit from the broad hunt for yield and broad resilience, even in an environment where growth is going to come back relatively slowly compared to what we would like to see.
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alix: ending on europe here, presumably you have the european recovery fund headwind removed. that is going to go forward. the brexit deal is now done. there could be a potential deal with china on investment. in theory you're going to get a -- getand in europe biden and europe working together over tariffs. why aren't we gang busters into europe right now? why are we still -57 basis points on the 10 year in germany , and italy at 55 basis points? torsten: i think there's a number of reasons for that. unfortunately, we are also seeing a spike in the number of cases in europe. the second reason is the rollout of the vaccine is probably going to be slower and europe for a number of reasons, and that means it will be lagging the u.s. recovery. the final and probably most important reason is that the u.s. has shown significant willingness to do fiscal expansion. europe has also shown that in a somewhat different way with jobber session schemes, but europe has not been able to do
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the same type of fiscal expansion for a number of reasons that we have seen in the u.s., and that means that overall, the european outlook is unfortunately going to be somewhat weakened, so therefore the backdrop is if you're looking at where the recovery is going to be at the moment, the short answer is china will probably come first, then the u.s., and europe will be number three and that renting. that means we probably have to therefore get used to rates in europe staying lower for longer, and potential even longer than what we have in the u.s. alix: good stuff. torsten slok of apollo global management, we are going to get his thoughts on the global trade rally, coming. . up next is the deal really -- the global brexit trade rally, coming up next. is the deal really done?
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alix: investors poured into u.k. markets on the first full trading day since i brexit deal ended years of uncertainty weighing over the nation's economic future. analysts at jefferies raised everyone the u.k. stock market to bullish, quoting, "we estimate the u.k. market relative to other markets could increase by 5.6% to catch up with dm equity flows since the brexit referendum in 2016." torsten slok with apollo global management is still with me. we did see investors really fully in 2016. what do you think of that? torsten: it is a huge relief for markets that brexit is now looking like it is more in the rearview mirror here. there are still some finer details to work out, and there certainly could still be a few bumps on the road, but it is very clear that the market has spent so much time on this topic for so long a time that it is not a surprise that there is a relief today and markets.
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more broadly speaking, the connection between the u.k. and europe, and the way the european union works has involved, as we have found out in the last few weeks, a lot of different aspects that are very difficult to disentangle, so therefore, the short answer to that question is that i thing a lot of people who have been very worried about bridget for many years are now looking with fresh eyes at the u.k. situation, and with that backdrop, it makes sense to have the view that this is no longer if thing we need to spend as much time on as we have done over the last four years. alix: you have technology, staples, the homebuilders for example doing really well. today, the banks seem to be underperforming, pretty much flat on a really upmarket. i am wondering what areas of the market do we still not have clarity that is underpriced and hasn't been priced in yet? be the: there will
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relief where people are saying if the u.k. is going to go through this, it might have lower growth. we are now going to see sterling with higher. that could have and petitions on different sectors across those that are more export oriented, but broadly speaking, the prospect for u.k. growth are better than they have been for quite some time, simply because this uncertainty has been removed. now businesses can start to plan for a longer horizon, and with that backdrop, you would expect that the growth rate for the u.k. begins to look better than it has done for the last few years. alix: where does this leave the boe? boe becauses is the brexit has been a 100% political decision, and a lot of their policy making choices at the boe would normally be driven by what has happened to inflation and unemployment come about at the moment, the bank of england of course has been stuck in a situation where it has been
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difficult to do much other than talk to the weakness of the economy, particularly at the bank of england. we are also watching very carefully how economies respond and how this misses respond. how are businesses going to react? are they going to do a lot of capex spending or hiring? you would expect that would certainly help in terms of the bank of england with what the future path of the recovery looks like here. alix: when we did the pecking order in the last segment, where does the u.k. fit into that now that you have this brexit deal, potential catalysts or headwinds removed? torsten: they would probably fit in between europe and the u.s., so the u.k. would be in the middle because they have the exchange rate and sterling freedom, if you will, that can give them a boost potentially, but that being said, a lot of
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the uncertainties here have to be eliminated, and we need to see how companies respond to the brexit deal. but broadly speaking, it is clear that this is something that will be helping, but they are still hit by the virus. unfortunately, u.k. also has the issue of the new strains appearing in the south, and all of that feeds into the near term outlook. so the answer is they are probably close to europe and are probably not going to see the same speed of recovery we see here in the u.s. alix: torsten, really get to catch up. happy holidays to you. thank you very much. coming up next, the eu and china very close to a major investment deal. we are going to talk with ryan hart, chair of the european
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alix: live from new york, i'm
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alix steel. this is the european close on "bloomberg markets." china andnd europe -- europe are close to a deal that would open up investment. joining us is run heartbeat a cofer -- is reinhard buetikofer. you seem skeptical about the deal. why? reinhard: there are a couple of reasons, both on the substantive size and on the -- the substantive side and on the procedural side. where thereerstand is this into view rush, this into your frenzy to conclude the deal without affording enough time to sort out all the concerns. , the ambassadors of the eu memory states met to discuss the deal, and the italian ambassador complained that his capital had not seen
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the final text. just cast aside. the polish ambassadors said maybe we should afford some time to have consultations with the incoming administration that was also cast aside. the french and the dutch said may be we should look deeper into issue of forced labor and human rights. that was also cast aside. this is really stunning, i must say. then of course, there are notablyive issues, most on neighbor protections. china is famous for not having conventions, ilo notably on forced labor. the european parliament, just before christmas, voted a resolution with a huge majority demanding that guarantees on
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forced labor should be included in the deal, which it is not. so i am indeed skeptical, and i must say that no deal that the eu concludes is a deal until the european parliament says it is a deal because the european ofmission needs the consent the parliament, and that is not just a formality. alix: the story in the market is that this is going to be a precursor to a pre-trade deal. should it be, and will it be? reinhard: that has been a claim from the chinese side for many years, that they wanted to strike a free-trade deal, and the european union always pushed back, saying until we have concluded the investment agreement, we don't even talk about that. i would assume that this will now be presented at the next stage. however, if i look at the change
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in public perception of china, if i see how the decision of the majority of the european parliament has developed, i skepticalighly whether there is going to be an easy ride. i don't see that yet. alix: to that point, who might not approve it? which countries? suspect, this is, as i and eu only deal, which means that it just pertains to union competency, a majority of the council and a majority of the parliament. if it is a deal that also toludes issues that pertain member states' competency, you would also need ratification by each and every member state parliament.
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that is what i do not expect to happen. not a as i said before, it is not a given that the european parliament would give it consent. make very tough scrutiny of the whole deal. alix: where does this also leave the u.s., particularly when you are going to have a different administration dealing with china and europe? reinhard: some people around europe say what is the big issue . president trump signed his own bilateral deal without consulting with the europeans, so why can't we do just the same? i would argue against that. we now have the opportunity of forging a stronger transatlantic cooperation on china, and we have already started doing that with the trumpet adminstration. we will certainly want to continue doing that with an
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incoming biden adminstration, so why should we rush at this moment? i haven't seen a good reason for that. alix: what country stands to benefit most from this? is this a germ anything because of the trade relationship when it comes to china? , europeanon average countries export about 3% of their overall exports to china. the rate for germany is between two and three times that number. so clearly, germany has a higher into investment relations and trade relations with china than any other european country, and certainly a few german companies, particularly in the automotive sector, have invested a lot into china. they have put a whole lot of their eggs into the chinese basket.
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and of course, they hope to be benefiting a lot from this deal. alix: thank you very much. really good to catch up with you on this. i appreciate it. thehard buetikofer, head of european parliament's china delegation. as we head to the close here in europe, here's where we set. we are looking to close off the highs of the session. the dax also looking to close a little bit softer. the cac off of its highs as well. arc its trade a little bit heavy after reopening -- markets trade a little bit heavy after reopening in force this morning. we will break down more in the close, coming up next. this is bloomberg. ♪
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alix: market closing now in europe, and a headline crossing, dealthe e.u. parliament
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-- that the e.u. parliament approved a post-brexit deal. the marketus to close. this is the first time we really got a true reaction with the brexit deal when it comes to u.k. assets. they were closed when the deal happened and they were closed yesterday as well. 1.6% offoff the high, the e.u. parliament news. the small caps did really well, up almost two full percentage points. what ended flat was financials, not getting much of a boost either way. financial services left out of this deal, negotiating upon all of that part of the problem. the other part is what is happening in the bond market in the u.k. you can see money moving into the gilt market, meeting yields lower about four basis points. that is never going to help a bank when you have lower yields in the yield curve does not go anywhere.
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in the currency market, you're a-sterling is down by one point -- by .1%. yesterday sterling fell on the brexit deal, and many were scratching their heads saying why is that? now reversed today, the euro getting a stronger. -- getting a stronger boost from the weaker dollar. you are seeing this continue to move higher on part of the dollar weakness, but it is also the best performing g10 currency overall this entire year. speaking of, the lira was on it strongest winning streak as well, outperforming all other em currencies, part of that also the weaker dollar story, also the aggressive central bank raising central rates. pretty deep into the individual sectors and stocks that are moving on the brexit deal in the u.k. and we have a look at that as well as the european markets.
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emma: as you said, we saw the u.k. stocks outpacing their european counterparts today. over the past week we are seeing that the ftse 100 really played catch up over the course of the week, a gain of about 2.4%, for the gain of the stocks it's hundred, the cac, and the dax, all higher. 600, the cac and the dax, all higher. significant.still given the underperformance of u.k. stocks. remember, the ftse 100 down from 12% this year, and if we take a look at a chart, we can show you it is one of the big global laggards over the course of the year. the blue and the white, the ftse 100 and the ftse 250. u.s. stocks really cheap. what we're hearing from strategists -- can we call it the end yet? of the brexit saga. the end of the brexit saga could be that trigger to take a closer
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look at the ftse 100. a lot of stocks, and a lot of sectors in the green. one of the biggest movers on the ftse 100, gaining 4.4%. this a big u.k. home improvement company. when you get into the 250, you are seeing the likes of london and portland, and gains of 2% to 3%. tesco, the big supermarket chain in the u.k. also putting in again today, along with the likes of morrison's. affected by the trade deal given how much food crosses the border. of the biggest customers is the u.k. small pop today, but a much bigger when yesterday trading for the first time since christmas eve on the trade deal yesterday. let's look at some of the biggest losers on the ftse 100. talking about the u.k. banks,
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significant losses today kept it down 3%, 4%. the trade deal good for them, but not good in the sense that it did not address financial services. there were nervous remaining about what kind of a court will come between the u.k. and europe eventually on financial services. finally, a quick look at the car industry. the car industry in the u.k. really owned by foreign companies. looking at a few of those there, there is concern that the brexit deal is too late for those as many of those companies already talked about moving operations out of the u.k. alix: thanks so much. we want to dig deeper into the auto sector. the brexit deal may be too little, too late. down, our european auto reporter. craig, it too little, -- is it too little, too late? craig: you definitely have the case with honda. they have a plan in england, in
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swindon, that is closing next year. they have pulled out already. you have nissan, a company that has the biggest plan in all of the u.k. that made some news recently. it is coming out that they had decided against building an electric vehicle here, that they are just going to build in japan instead. that is the second time in the last couple of years that there has been a sort of negative decision made with regards to a production decision for their plan in this country, and there is real concern that this is a plant that is massive, one of nissan's largest globally. nissan was really worried about the fact that brexit was potentially going to render that massive factory not competitive, and set from its business case. it is definitely a sigh of
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relief that we have a deal, but it is definitely a last-minute one, and it sort of give the industry a scare and they had to make some decisions in the meantime. alix: the big issue is the rule of origin. so a certain amount of components have to be made in the u.k. leave a seem to lea lifeline for electric vehicles. you would think that that might be a win -- i say that tentatively because it seems like that necessarily isn't going to stop the automakers from leaving? craig: i think with that it is definitely a win. it is something that they really had to do. it was not really a sort of choice in the matter unless you wanted to basically penalize electric vehicles for having so -- dof the supply chain you want to disincentivize people from buying cleaner cars? i think both the u.k. and e.u.
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negotiators did not want to see that happen and the industry didn't either. the question is how quickly can they localize that supply chain. you mentioned the 45% content rule. that will ratchet up over the course of six or seven years. it is a question of whether the industry is able to sort of hit that timeline. we think it probably is the case that it will because you are talking about local content being about the u.k. and the e.u., and there is a lot of battery production going into europe in the next few years. reporter,mberg's auto thanks very much, craig trudell. let's stay with brexit, the auto sector. ceo chain federation chemical chain federation with over 500 warehouses and 30,000 vehicles. shane, it is good to talk to you. on what we saw before, we got a deal preparing for the end of the year with a lot of
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stockpiling. we saw anecdotally a lot of arches, ports being crowded, border crossings, and tons of trucks mile-long -- is that the future, or do we avoid that? chain: i think the jury is still -- shane: i think the jury is still out. it will move but it will probably move a lot slower. paperwork between the u.k. and european, very different from the first of january. we have got a lock to work through, but as professionals get problems solved, that is what they do. alix: and the incident near dover, you had clashes with some of the truckers, and they could not because of covid tests, cetera how do we avoid that in some capacity when it comes to the brexit deal? shane: collaboration is how you deal with that. the great thing is we have a
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deal. now that we know that the governments are working together, there is a common interest to revolve -- resolve those issues. the officials on the border being able to deal with those queries and concerns and help get them moving. as long as we keep things moving, we will make it. alix: what do you think it looks like now versus six month ago. like i'm a trucker and i'm driving up. then what happens. going into france from the u.k., it is the same as going anywhere else in the united kingdom. from the first of january, it is a foreign export like going anywhere else in the world, so that requires a significant amount of bureaucracy and paperwork. it will be slower and more expensive, but we have to learn how we go between now and the next few months. it will take some time to learn how to do this. alix: do you have a sense,
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companieswho are the and border agents staff to deal with this? shane: that lack of implementation means that we have not had time to scale up within the government. that is a big risk area, not having enough people with the skills to process this massive increase in border exporting and importing. that will be going in a weeks time. alix: how long does it take that to develop? shane co. it could take years. it will be rocky. there will be ups and downs, there will be fluctuation, there will be times when it works well and times when it doesn't work so well. period, alix:tion i wonder what the repercussions
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are. do you anticipate shortages of certain items, certain things? do you anticipate higher prices as we are having to deal with that? what do you think? shane: it will be the -- it will be a common nation of those things. coming in from other parts of is more complicated. a lot more paperwork involved, more friction in the trade, and that means there will be cost inflation. who bears that cost is the big question. there are a lot of people in the industry trying to avoid that being the case, but ultimately -- talking about the astrazeneca vaccine -- how are things going in terms of transportation? you are the guy who is going to be transporting in the pfizer vaccine, and unique cold temperatures to do that. shane: it is going well.
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we have already distributed to half a million people already with the pfizer vaccine, and where seeing the astrazeneca vaccine coming on stream hopefully this week. we know what we are doing. scale,n unprecedented but we will deliver that, no problem. alix: good, so that we can take care of. i appreciate that. shane brennan, thank you for joining me. cold chain federation ceo. this is bloomberg. ♪
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ritika: this is bloomberg european markets, the european close. at 2:00 p.m. in new york, seven a clock p.m. in london. this is bloomberg. ♪
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let's check in on first word news with ritika gupta. the house is daring the senate to follow in his footsteps on getting stimulus payments to most americans. democrats and some publicans theoved a measure to up $600 payment to a $2000 check. this is backed by president trump. four point 6 million people in 16 countries have received of the covid-19 vaccine, according to data collected by bloomberg. two doses are required a week apart. the u.s. has administered the most doses, more than 2.1 million. but dr. anthony fauci says the is lagging in its vaccines. pierre cardin has died. he was a visionary, dressing the
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famous and the masses. his brand was a wide range of products, everything from bath towels to fragrances. he was 98 years old. francine: economics, finance, politics. this is "bloomberg surveillance." i'm francine lacqua, here in london. global news 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries, i'm ritika gupta. and is looking to fold financial corporation into a company to be more like a bank. beijing could take a larger stake. questions enter how much the oversight is. is our bloomberg wall street correspondent. let's pretend it is holding company for some is that so bad? >> it depends on how you're looking at it. on one hand you have a business that is fast-growing and this put some rains on the business.
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regulate and was going to come anyway. what is scaring people here is -- one of our bloomberg opinion colonists made the point that it was not that columnist said it was not so bad when -- it is still able to grow. the financial times had done a great analysis that said it is a difference between 40 times versus 10.atio from that perspective, it could be a big barrier as to how much it is worth in the near term. alix: i'm trying to see where this leads with private equity. there are big names involved in the company that didn't get to cash out with any ipo, and if they have to rerate for growing it 10 times versus 40 times, what are they thinking about right now? >> it is a fear but it was always a fear. it was worth $150 billion a couple of years ago. that is way more than any u.s. financial technology giant, so it is already a big valuation.
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we thought that they would exit with a 40% to 60% return. that is not going to happen. however, that said, it doesn't mean they will not get a return at some point, and they still on paper are one of the most valuable financial services companies in the world that trumps the size of morgan stanley and goldman sachs and citigroup. alix: will it change the way they look at future investments in china, particularly if there were is one based around a personality? a long i do want to take view on this because if you are an investor in chinese technology, particularly chinese financial technology, the long view is this is a fast-growing sector with a lot of demographic trends that will be good in the long term. credit business can have a lot of to grow, even with the hamstringing on it. that is the view you have to take with these kinds of companies. it is not like alibaba and
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tencent have not had their issues in the past, but again, it is not great as it is happening in conjunction with what was going to be the world's biggest ipo. another statistic for chinese ipo's, it is still going to be a record year. is even without an alix: give us a sense of how much role jack ma himself played into ruling the private equity landscape. sonali: a lot, right? when you invest in these companies -- the number one thing, what is stopping somebody else from getting into this space? with alipay, you had see them waiver in market share. jack ma really is the vision here, and his ability to oversee a sprawling empire -- remember, we have had financial services giant in the past that have gotten into significant issues when it came to financial services. there is trust in jack ma to diversify. alix: really interesting.
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cannot wait to see how that plays out. you.i basak, thank we appreciate that. this is bloomberg. ♪
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ritika: time for the bloomberg business flash, some of the biggest business stories in the news. for the first time in almost two years, the boeing 737 max is making a commercial flight in the u.s. american airlines is flying it from miami to new york. the 737 max was grounded in march of 2019 after two crashes killed 340 six people. it cost boeing tens of billions of dollars in fines and damages. u.s. housing prices rose in october for the most into any 14 -- since 2014. the index was up over 8% from the previous month.
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the index measures prices in 20 large u.s. cities for stuffiness, seattle, and san diego led the way. it is the same story as it has been four months with mortgage rates driving up prices. goldman sachs raised its price target from $47 to a street high view of 70. revenue growth as the parent of snapchat. it willggested that outperform initial guidance for the fourth quarter. that is the latest bloomberg business flash. alix: thanks so much. house democrats and some republicans are reproving a measure bashar approving measure for the coronavirus -- are reproving a measure for the coronavirus relief bill. joining us is laura davidson. laura, mitch mcconnell is in a tough spot. what is he going to do? laura: he will go out and do his normal start of the senate speech. he so far has been very mom on m on the sizey mu
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of the check. anything he says today will give an indication of where he's going. senator chuck schumer, the top democrat in the senate, is pushing a fast-track vote to approve the checks. some republicans -- schumer is hoping he can do that in the senate as well. it looks unlikely the way they work. how does mcconnell deal with president trump, very angry at him for not backing him up in terms of overturning election results, to his base, not looking like the guy who is not giving people money? what is the procedure? how can he get out of this procedure really? laura: he can sort of deflect the blame a little bit. if another senator does not have quite the same political stance that mcconnell does come he can inflict that, blame it on the
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clock, say it is not enough time to get this done. it is an interesting power struggle forming between trump, the outgoing president, and mitch mcconnell, fighting to keep his senate majority leader spot. with the runoff election week in georgia, kelly loeffler and david produce said they want those $2000 checks, siding with mcconnell. if they were to win reelection, they would be working with mcconnell and relying on mcconnell. trump will no longer be in office. this is an interesting divide among republicans. alix: an interesting point because i wonder if they do get reelected, can we see a $2000 to melissa check being passed -- $2000 stimulus check being passed? tricky.t is it depends on where republicans are and if they win. it is unclear that this has the support to get through the senate.
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you have republicans who are saying that this is too much and this -- and don't have the tenure to join with democrats. alix: she is open to $2000 checks. it is an interesting hour, watching what mitch mcconnell has to say. laura davidson, thank you all of those news headlines are not affecting the news headlines at all. you had the nasdaq, the s&p, the dow higher. much anywhere.g 2% hitting another record intraday-of the dollar much weaker here. your-dollar the highest level that euro-dollar the highest level all of this year. happy tuesday, everybody. this is bloomberg. ♪
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david: from the bloomberg
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,orough in washington dc worldwide, i'm kevin cirilli. >> welcome to "balance of power." kevin, let's get right to the world of politics and economics and let's do that with abigail doolittle. it looks like a mixed day. abigail: it is certainly mixed, slightly jittery, even bearish at this point as we open with solid gains for the dow. the russell 2000 is down for the third day in a row. yesterday, retreating from a record high, a bit of a concern on the close. the russell 2000 really underperforming today, down 1.7%. at this point, the s&p 500 and nasdaq have been fluctuating between small gains and losses. a jittery tone. the fact the russell 2000 has been down for three days, the first three day losing streak going down back


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