Russia, Vladimir Putin, Jack Sweeney discussed on Bloomberg Daybreak Europe

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A good morning to you and thank you a second bit to create a safe passage for over 200,000 civilians trapped in the southern city of Mario pole failed over the weekend this morning Russia says there was a fresh agreement for a temporary ceasefire to enable a humanitarian corridor in several cities The town of urban just outside the capital Kyiv has endured sustained shelling by Moscow's forces Russia's president Vladimir Putin has reiterated the war will continue until Ukraine accepts his demand and halts resistance This is lowering the hopes for a diplomatic resolution Now a decree signed by president Vladimir Putin will allow Russia and Russian companies to pay foreign creditors in rubles The decree establishes temporary rules for sovereign and corporate debt is making payments to creditors from the countries that quote engage in hostile activities against Russia Russian corporate bonds denominated in foreign currencies have plunged to deeply distress levels in recent days as investors do weigh the impact on sanctions and finally a teenager from Florida who sought to fame tracking Elon Musk's private jet is turning his sights on two yachts of Russian billionaires Jack Sweeney started tracking the aircraft of Russian oligarchs at the end of February Now he is also following their yachts as a tycoons come under increasing sanctions pressure following Russia's invasion of Ukraine 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 I'm leann gerrans this is Bloomberg Anna Thank you very much Leigh Anne Let's get to our last conversation of the hour Tatiana grill Castro joins us co head of public markets at New Zealand very good to speak to you Tatiana We're sitting here looking at commodity prices going considerably higher gas prices across Europe taking out new highs oil prices not at new highs but certainly an incredibly elevated levels One two $7 a barrel is what we trade on Brent We've been as high as one three 9 overnight How quickly are you having to rethink strategy as a result of these high commodity prices relevant relative to recent history Yes good morning and you are quite right I mean we really have to reassess the portfolios again because it is high energy prices high commodity prices Supply side disruptions are all those things what impact that may have on demand and consumer confidence So all those things we need to reassess that the first level of assessment clearly because we have to get started and to the relatively quickly is generally always capital structure how well capitalized the company is I know a lot of people now look at banks and what impact that may have We see actually banks very well capitalized We don't expect anything similar to what we saw in 2008 And because they have much higher capital buffer than they had during the financial crisis And all the exposure to Russia is actually very manageable for the bank And so because they're so over capitalized it wouldn't cause any we don't expect them to cause any significant issues But clearly there is always also potential unintended consequences We see more broadly sectors all sectors across the board as they retrieve out of Russia there are no buyers of those assists who have to write the most completely And that we also saw in the bond market as you say there's a lot of concern of will you get paid what currency will you get paid in Will you be able to receive payment may cost a technical default And all those sort of uncertainties are overshadowing the market at the moment Bank share prices today and what they're doing I mean some of these moves quite stunning in just one day This takes you back to the financial crisis the types of moves we're seeing here Tatiana I mean something like UniCredit down by 14% we see commerce bank by 12% erst a group 12% I mean and 11 Some banks like rice and you know there's actual exposure to Russia substantial to talk about there Other banks yes there is some but you wonder whether the selling is overdone I see stock gen down by ten and a half percent today Are these have we overdone the selling of the banking sector do you think On a fundamental basis yes it clearly is a case of people wanting to get out of those names and nobody's stepping in So fundamentally it does look over them but that doesn't mean they couldn't get a little bit worse because what we are expecting actually you go to safe haven So there is clearly in sovereignty but also just in cash So investors may be worried or asset managers worried that there could be outflows So you just want to reduce your exposure and given the level of uncertainty there is a really many who think that this is the right level because there are things So there's a lot of technical pressure at the moment Okay I mean is there anything authorities should be thinking about doing here looking at the extent of selling we're seeing on the banking sector Tatiana We've heard from some individual banks about their levels of exposure hoping that that will kind of put a line in the sand is that what's going to help here or should it be some an ECB voice or government voices talking here to try and calm nerves about banks What should be the course of action What should what would calm things down Yeah as you say I mean the individual companies coming out and stating the limited exposure that they're having especially bank It seems investors aren't really listening So it is really a matter of sort of shoot first ask later in that regard I mean just reduce your exposure and then we assess So yes that would warrant potentially a fiscal and a monetary response And that's something that we are considering at this stage Maybe less around banks but if we continue to sell off the could also be okay but more broadly as we said earlier energy and commodity prices the impact that has on the board economy So you could see actually a fiscal response may be very targeted with the response over the next week or so And also monetary policy we all expected the ECB to exit quantitative easing and to start raising interest rates and there made have to have a little bit of a different approach because clearly inflation is rising that may vary in higher interest rates but at the same time volatility is also so great that may warrant quantitative easing So it could even be that they do both in parallel So we'll have.

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