grips chinese tech stocks as concerns pile up. new lock downs in two provinces. let's look at the futures. despite the bloodletting in chinese tech. you are seeing very much that will be the top story for us. the modest optimism that remains in focus for us. the ftse 100 is flat. stateside futures pointing up as well. the ftse 100 counting down year-to-date. european space in the s&p remaining down. the ftse 100 down 3% year today. let's switch it on and see how

things are playing out across asset. we continue to look at the inflationary effects of the war in ukraine and how that will be weighed. markets pricing and a hike coming in wednesday. here is where the pressure is being felt most acutely. this is specifically to the ukraine story. this is part of the fact of concerns around the outreach from moscow to china for military support but it's important about regulatory concerns. you are seeing losses more than 11% across those chinese big tech names. this illustrates how that compares. the ruble remains under pressure. this is 6% gains for the dollar. as you look at the potential around diplomacy. $108 around lowered by more than

3% on brent. let's switch it in then and have a look at the terminal that shows what's happening. the implications of the humanitarian crisis and how that plays into the markets. but in terms of what's happening, just a snapshot for technology, it is pronounced, of the selloff we are seeing. the chinese tech sector bring you down below the valuation, so the entire chinese tech, evaluations lower. just to illustrate the pain. panic selling, let's get back to what's happening on the ground. the pressure on moscow appear to be growing. we've lost access to almost half of the reserves.

america and china will hold their first high-level in person talks since russia's invasion of ukraine. the white house's warning beijing not to help moscow evade sanctions. >> we will not stand by and allow any country to compensate russia for its losses. there will absolutely be consequences for large-scale sanctioned invasion efforts or support to russia. we will not allow them to go forward and be a lifeline to russia for the economic sanctions for any country anywhere in the world. >> let's bring in maria. what can we expect from the talks. they will be held in private is what i'm hearing. maria: every day we think about the ukrainian people that's now stretching in, you see what's happening in parallel today, one that eluded to the american

delegation meeting with the chinese delegation, this is happening just a few hours after that story broke that russia had turned to china for military assistance. we talked about this on the show for weeks. by becoming very complicated to find on the ground for russia, the longer this goes on the more expensive it becomes for the kremlin. when know the economy is under huge pressure for this meeting, one of them is a request for assistance does not mean china has to granted or is an interest in granting it. that warning, but helps russia circumvent sanctions will phase repercussions. the other thing is also happening will be that video conference the ukrainian delegation now. we know the conference also met in person.

the reality is we haven't seen anything that looks like a cease-fire. the ukrainians on saturday so there had been a change in tone from the russians. this is not just about ultimatums but they are now beginning to listen. that's perhaps a shift in these stocks. tom: maria with the latest between the u.s. and china. joining us now is kieran, a multi-asset strategist. good morning. it's the base case that you get a cease-fire this summer. the left -- let's hope that happens in a quicker time frame. how are you building defensiveness into your portfolio. >> the outlook has been broadened. what we are thinking about is how do you deal with less tail risk.

like health to the u.s. dollar and also how we can incorporate options to try and mitigate our downside risk and where the upside opportunities as well for things like cybersecurity, potential winner and longer-term and something that we will refocus on security as a result of this. tom: there's a temptation to take cash put it on the table and wait for some clarity. is that advice you are giving to your clients at this point? kiran: it depends on the quantity. people think about what are spending needs that have that held in cash and shorted bonds. this is not embargoed you want to be forced to be selling assets. at the same time we think the general long-term strategy is best to be staying invested because geopolitical crises tend to not have a long-lived

negative impact on market. so we still think it's better to be invested in some hedging into your portfolio. tom: what is the level of concern about the credit risks at this point and how the oil price and commodity price feeds into that. working for balance sheets on the record levels. kiran: it depends on what level we get to and the volatility. i think that's pretty manageable level on brent. in terms of the impact on the economy and the credit. the level of volatility, it's been relatively calm the last day -- last few days. that raises concern that you might see margin calls and count -- challenges because they put in hedges in volatility.

we haven't seen too much risk in the credit space. if there are more volatile prices we may see that. tom: does that online -- aligned with your thinking? kiran: we had prior to the crisis a six to seven rate hike setting price. people are thinking what to do about this. they can do much about it so they will have to hike as they plan. that is realistic for the fed and we are looking for the ecb at the end of the year. tom: what is propelling the u.s. dollar and leading that support? is it a safe haven move? kiran: i think it's part of what receipts is attractive in portfolios at the moment. on the higher value side it is

still attractive at the moment because it's the potential income ahead and the qualities. >> when does it start to feel overly priced for the dollar. when do you say that's enough. kiran: it's not too much lower than where we are today getting below 108. plus we see it will be time to be building in the euro rather than the dollar. tom: kieran will be staying with us after the break. we will be looking at china and the news on china, this is remarkable. a major covert outbreak in the chinese city. multiple banks into that. we have more on that next.

stay with us. this is bloomberg. ♪

tom: welcome back to the open. 12 minutes into your european trading day. gaines across the board on european stoxx 600. stateside pointing to gains for

the nasdaq and 9/10 on the broader s&p. the biggest ones are being felt in china particularly hong kong. a couple minutes ago across the terminal, of the stock aged 7.2%. relentless in chinese technologies continues unabated. let's get more on the ground with acosta who is always in the weeds on this. a massive selloff in tech stocks. break what's driving this. >> it's been completely brutal. we saw this across the week. the golden dragon index was to chinese tech stocks on two consecutive days. in the 22 years in existence and we've seen that follow-through,

there's multiple factors at play , the financial decoupling story , owning china in your portfolio has become increasingly risky as xi jinping moves closer to the lines with putin and the concern there china is risking sanctions and the impact that had on russia. they were both extremely low. with -- went to zero almost overnight. extreme concern as well. a big tech hub in china across the border from hong kong. 17 million residents for a week because of covid, concerns covid will spread in china really complicate the economic recovery this year. more regulatory concerns, the wall street journal reporting

wichat is facing a record fine because they said they violated money laundering rules. potential delisting concerns. the fcc is really pushing ahead with its auditing, the chinese companies are unwilling. when you combine all of this, it just keeps piling up and i would say tomorrow may be a key -- another key day for china because we could get an interest rate cut. covid zero is looking like an increasingly difficult pulse for china. can you get economic growth without stimulating the economy, economists are saying no and they have to do a lot more than it has done to really support that. tom: joining us at a hong kong,

to what extent can they support given those headwinds for the chinese economy. it is remarkable. let's bring back kiran. interestingly when you look at china and you're weighing it up against exposure globally, it still remains one of the preferred regions at least within the asian space. have you second-guessed that? >> if you're looking at a diversified portfolio of equities, it is an allocation on the global scale. when you look in the asian markets we think china is relatively well positioned going forward. firstly relatively cheap, significantly in recent days and over the course of the past year. we talked about that 5.5% growth

target and think about how are they going to achieve on that. as we get into the second half of the year of the going to need to put in extra fiscal or monetary stimulus that's getting withdrawn for the markets. we are focusing on some of the potential beneficiaries for things like metals and mining, which could benefit from the government trying to get up to that growth target which is clearly difficult. >> there's an expectation that monetary and fiscal support could offset some of that pride -- that. kiran: they may continue to. if you look at some of those cyclical areas of the market they may bring the rate growth up. we think it is a relatively attractive market. >> you've stayed clear of

chinese tech at this point? kiran: a broadly neutral sense. it is pretty cheap. it is undoubtedly cheap. when are these regulatory headwinds both china and the u.s. going to ease and maybe that takes the tensions that that space is going to ease. tom: coming through in the months ahead. as there throw out to the broader em space, but the beneficiaries on that additional support. kiran: you see some support flowing into other countries. em is eventually pretty good which have benefited from a higher commodity prices and we start to see that stimulus supporting things like infrastructure that can also support the australian dollar

we've been looking at recently. there will be some flow through but we will get the primary beneficiaries. tom: this remarkable switch seeing some of the focus away from energy dependence on russia filling out the capacity here, how and what is the theme around investing? do you have a roadmap in place for that transition? kiran: it goes back to what i was saying earlier about security, green tech, renewables, the whole space spans well beyond that international security as well. that whole space -- security will be as countries and companies shift their focus away from supply chains and more toward security and i think this will add to that focus. tom: did we avoid a recession at

this point? kiran: commodity prices of the thing to look at. you need to get lots and lots of headlines. if commodity prices can stay below the $120 a barrel we probably can avoid recession and we start to stay above that level then we are going to see recession in europe. tom: in the earlier section, what about hedging. kiran: the u.s. dollar, we are looking at kind of expensive to buy the option at the moment with the general price of the fixed index. we have the strategies the best way to hedge, we see the u.s. 10 year drop significantly on what they are having in the context of the portfolio, we would wait for volatility for explicit hedges and portfolios of the moment. tom: thank you for coming on.

multi-asset strategist at ubs global wealth management. the european stoxx 600 gaining 7/10 of 1%. stay with us. this is bloomberg. ♪

tom: we are 23 minutes into the european training day, gains broadly on the index that really stands out is the dax up more than 2%. more muted set of gains up to tenths of a percent. decent moves, the diplomacy around russia and ukraine seems to be moving at the edge, it is a little bit of optimism around that. you've the meeting between the security advisors in the u.s. and xi jinping's top diplomat in rome. around the diplomacy you've got that gaining again, the exposure to rush of air and the fact that possibly some level of diplomacy is starting up gaining 5% about 60 basis points or so. some exposure to chinese tech

particularly tencent leading to pressure down almost 8%, seeing chinese tech absolutely hammered , the beating of china's tech sector has been closed down for a week. the headquarters is in that city. almost 8% as you can see, you had rbc capital, surprisingly optimistic. the outlook for 2022 very solid 2021 results from rbc capital. individual stocks we are bringing to your attention. let's get the bloomberg business flash with laura wright. laura: a multibillion euro hit to full-year earnings for regulatory measures. the french utility has already had that this year with the

output dropping to its lowest in more than 30 years due to repairs and maintenance. the decision to force her to sell more power at a deep discount to keep them shielded from soaring prices will had earnings by 10.2 billion euros. bloomberg has learned china is planning a passive increase in coal mining. the economic planning body told them it wants to boost domestic production capacity by about 300 million tons. it also plans to build a 620 million ton stockpile. china produced over 4 billion tons of coal last year. that's your bloomberg business flash. tom: coming up, accelerating russia's shift towards an isolated internet. the troops poured across the border, the russian government began its internet shutdown.

we will bring you the story next. the markets across europe gains of 5/10 of a percent. this is bloomberg. ♪

tom: welcome back to the open. here are your top stories. calling on china, the u.s. says russia asked for beijing for military aid in ukraine. negotiators from russia and ukraine are said to hold further talks today after a weekend where moscow increased aerial attacks on areas closer to ukraine's border with poland. plus panic selling, concerns pile up.

new covid lockdowns announced in a tech hub. let's check in on these markets. what are we seeing across the benchmark. we will break it down, the ftse 100 is now range bound, that index remains lower by about 3% year-to-date where to outperform european stocks. today it's facing a dragon the ftse 100. autos near the top in terms of sectors and certainly the results, of the bullishness in fact the outlook for the dax. broadest european stoxx 600 was a gains of 5/10. it started to look a little bit more positive over the weekend. we talked about the stocks later today and the meeting between the chinese and the americans to see if anything comes of that as well. oil is up today and that's

playing into what's happening across the commodity space. auto gaining 3.5% followed by construction materials. top performing sectors in terms of the picture. followed by health care, energy also lower. 108 was the last time i looked at the brand. the picture around the geopolitics of the war in ukraine. the russian invasion has sparked a turning point for prudence break from the western internet. facebook and twitter have been blocked by the russian government. others like microsoft are curtailing their operations in the country. it allows trying -- russian to turn more closely to the chinese model to insulate them from the west. the ceo of solar labs joins us. the company that makes software

to circumvent online censorship. they have deep insight into the cyberspace picture and run human rights and censorship in russia. what is the situation in russia. how is the census have changed in the media space just in the last three weeks? >> thank you. basically we have tremendous changes. we see the russian government now blocking resources which they did not block before. facebook and instagram became available for all russian citizens and none of them are able to access it except vpn services. we also see massive restrictions are imposed on the social networks other than instagram. so twitter or facebook, of those social networks not only blocked in russia but also recognized

and basically if you are a signed in use are there and have an account on facebook or instagram, under the russian law , a russian prosecution may recognize you as a terrorist which make it dangerous for people to use those social networks in russia. tom: what are those talks? you mentioned the vpn service. have you seen an uptick in demand for vpns or the risks just too great given what you've just outlined? >> we see the great use for vpn services there. people are looking for tools to bypass those restrictions despite the fact the regulatory services are under attack and for example vpn services are not acceptable in russia. services based on others are

fully accessible in russia. it's much more complicated to get it banned so the government does not have enough resources to keep that and we see the demand for these services is growing and we see generally speaking blockchain technologies are now trending in russia and since people are getting banned from visa and mastercard they still have to transfer money throughout the border to other countries, they are using blockchain technologies for that and we see the same use for blockchain to provide them more free access the internet. tom: we talked about the fact russia may be moving towards a chinese form of the internet, of the way they put in place restrictions. china took decades to build out

the great firewall that they have. is the technology now available close enough to break through these restrictions? is it possible for russia in a short space and time to build those restrictions? >> it will be possible but it will be much worse than in china because they will have additional consequences which they haven't predicted, have not prepared for it. banning let's say oneweb service at the moment trying to make it accessible for russians they might ban accidentally other web services which should not be and that's the only thing. tom: i want to draw on your experience working with the opposition in russia. you are based in estonia now. you worked with alexei navalny, of the figurehead of the opposition movement largely in russia. what is your sense of the scale

and scope of opposition in russia to this war? >> generally speaking, i personally don't know any people who are in favor of the war with ukraine and i do not personally know any people who are cherishing it or saying this is something russia should do. everyone is condemning the war with ukraine. gathering lots of people for rallies in moscow and st. petersburg, people are taking to the streets and telling the government basically they are not liking what's happening and are against the war. we can consider those people also as victims of putin's regime. we see the people going out to

the streets with signs saying no war and they are going to prison for that. tom: are you able to have any communication with navalny and is he still able in his incarceration to rally the opposition? >> yeah. that's really interesting because despite the fact he is in prison he is still able to manage the process and to lead it. he asks everyone to go out to the streets, his trusted persons who visit him in this message was heard and there were quite a lot of people going out to the rallies and as they announced the rallies will take place every single day from now and that's going to continue until the war ends. tom: i was in barcelona at the

congress a couple weeks ago, executives are saying they haven't seen major cyberattacks by the russian state on ukraine or nato allies during this conflict and there was a level of surprise but that hasn't happened. there was an expectation given its history that russia would launch cyberattacks. do you have an explanation for why that hasn't happened? are they holding it still is a potential part of their arsenal? >> actually i have. there were several groups of hackers who used to work for governments and were cooperating with russian cybersecurity agencies and so on and they were conducting some cyberattacks on western world and for now they changed their minds when they saw the war, they saw the people putin was bombing were peaceful citizens of ukraine and they just tried to pull away from it

and do not want to interact with the regime any longer. as a result we see many of the hackers who used to be in the hands of putin as an instrument are not doing that any longer. i just personally think that those people who were involved in the cyberattacks will no longer work with putin's regime. tom: interesting insights, we appreciate that. ceo of solar labs. helping to build out software as well around protecting citizens from some of the censorship tools. thank you. oil was falling again as iran -- a missile strike in iraq. talks on the nuclear deal

stalled. more on the geopolitics up next. this is bloomberg. ♪

tom: welcome back to the 43

minutes on the european trading day. just coming off earlier highs. the ftse 100 down by the 10th of a basis. top of the list in terms of sector support, basic resources down. oil this morning. from small calls to sidelines the opec-plus producer. the suspension of iran nuclear talks also weighing on the markets. anthony, just walk us through where things stand on the iran negotiations? anthony: the negotiators who have been meeting in vienna have been discussing ways to get back into the deal that donald trump pulled the u.s. out of, they've all gone back to their capitals so they are there, conversations

with the government's to see what they want to do and what the iranian side is that this is down to a diplomatic and political decision now, so the negotiation work has been done, there is a deal they are to be signed but they need to governments to come together and see what they are willing to concede on and where they are willing to make those final adjustments that will get the parties together. that's what we are hearing from diplomats and negotiators saying there could be a pause. if there is some movement from the capital and washington but gets them back together in vienna to really finalize that deal, of course you got some interference from russia rejecting parts of the deal and that's where you've got this delay. tom: some additional

complexities there's already a challenge set of conversations around iran in the nuclear deal and then of course whether they will get it across the line you're saying it's not dead in the water yet. when it comes to oil prices today the action we are seeing lower by about 2.5%, what is underpinning that move for slightly lower prices? anthony: the name of the game is volatility after we saw huge swings last week we are seeing them start down this week and there are many other factors to come into that. this week it looks like there is also talks going on between the russian and ukrainian side about the conflict there and the potential way to that russian invasion we also seem to report the u.s. and china are supposed to talk, china is supporting russia in its invasion of

ukraine, one of the members of the group that is negotiating the iran deal so any kind of talks there, it looks like oil is grasping for any type of positivity to come out of these discussions and that's bring the price down. that is all bullish for oil. we've seen iran launching missiles into iraq, those talks are stalled and that doesn't get us that oil back in the market, that should be pushing oil price higher. roche is a bigger producer than iran, so russia being bigger -- out of the oil market is bigger. we are grasping for positivity from those talks now. tom: wti at 105. brent at 109.

anthony, thank you for that insight. laura: the u.s. and china set to hold their first high level in person talk since invasion of ukraine. the national security advisor will meet with the communist party policy member in rome later today. president biden's top advisers have been working to increase pressure on china. u.s. officials say russia asked china for military assistance for the war in ukraine. a chinese spokesperson said he was unaware of any suggestions china might be willing to help russia. beijing is repeatedly called for negotiations towards a cease-fire but it stops short of condemning the invasion. you governments are said to be discussing sanctioning the owner of chelsea football club along with more than a dozen other prominent russians. they met to discuss a fourth round of sanctions and trade

restrictions to the energy and mining executives as well as media leaders that could be targeted. china sent 17 million people into lockdown for at least a week with residents ordered to undergo three rounds of covid testing. bus and subway systems have been shot, businesses except those providing essential services have been closed, nationwide virus cases double over the weekend. iran says it powered up a missile strike and has suspended talks on restoring diplomatic ties with saudi arabia. that's days after iran halts negotiations to restore the 2015 nuclear deal. 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. tom: thank you very much. we reflect on the 18 minutes of

chaos that broke the market last week. that is next. this is bloomberg. ♪

tom: welcome back to the open. you are seeing gains of around 5/10 of 1%, euro-dollar is

stronger. 10% in today's session. the european officials are drawing up other sanctions, hoping to finalize that today. crossing the terminal part of that package may include an export ban to russia on cars valued at over 50,000 euros. milling and export ban on cars to russia. we'll get you more details when they come through. let's turn to bloomberg's take which looks at the 18 minutes of trading that broke the nickel markets when the commodity price went vertical. plunge into turmoil, not seen since the crisis of 1985. joining us now is jack. how serious than was that. how serious could the impact for financial sector from what we've

seen across the space and how dangerous is this or was this moment? jack: this is probably one of the biggest moves we've ever seen in any commodity market. prices went up 250% in the space of about 24 hours and really with this caused a huge amount of pain was in margin calls. any company involved in that industry often hedges their price exposure with a short position. when the price goes up they have to pay cash in margin calls in the margin call across that was insane on monday night and will be even -- was even worse on tuesday. but what we are talking about is many billions of dollars of margin calls across the metals industry causing a huge amount of pain. this morning in our story, 45 of

the brokers would have failed. i think we did come pretty close to the edge. tom: it is remarkable. what happens next? any clarity on what the roadmap is next for this market and when you expected to reopen. jack: the real driving factor behind this is a short squeeze from the position of its giant chinese company owned by this rather amazing and very risk hungry entrepreneur, i think the key to getting the nickel market reopened will be a resolution for this position. struggling to make margin calls to his bank last week, that's one of the key reasons behind the initial squeeze the took place, so we need to see some

kind of deal either for him to reduce his position over him to get financing from somebody in order for the market to be able to reopen in so far we don't know when that's going to come. tom: jack, thank you for joining us, breaking down what happened last week and when trading may gain back for that market. a remarkable extraordinary week. tying into the commodity space and the centrality round oil. india and officials there saying considering buying discounted russian oil, that's according to reuters. just to clarify, india importing 80% of its oil considering buying discounted russian oil. let's check in on the market. gains of around 5% across the european space. u.s. futures, gains of a similar amount. a little bit of optimism around

diplomacy for russia and ukraine grade chinese tech being absolutely hammered. this is bloomberg. ♪

>> we are breathing rare five air in terms -- >> the markets will also feel the volatility for time to come. >> the bigger picture is you are looking at systematic risk. >> it will be a seismic shock that has hit the system. >> this is "bloomberg surveillance: early edition." anna: 9:00 a.m. in london, 5:00 a.m. in new york, 5:00 p.m. in hong kong. our top stories today. pa