tv Bloomberg Markets Americas Bloomberg May 30, 2018 1:30pm-3:30pm EDT
disputes is a joke. forum inat the oecd paris and said the wto mindset is that anything and exporter chooses to do is find. a panel of experts working with the organization of american states has accused the venezuelan president and his government of committing crimes against humanity, making his first public remark since the report was released. the secretary-general tells bloomberg exclusively that sanctions should be imposed on the oil producer. >> the second thing we are doing is working with member states in to referconvince them this report to icc. work thesening to from now until september. mark: they will first need to
review the material before announcing any formal investigation on president maduro or his government. -- may be limited outside venezuela. india and pakistan have agreed to abide by a 15 year old cease-fire agreementer years of fighting over the disputed border at kashmir. this -- signals a potential and relations between the nations. the cease-fire was originally drawn up in 2003. both countries claim kashmir as entirely theirs. says that former president george h w bush is in good condition but will need several more days of treatment. he was taken to the hospital -- after he experienced low blood pressure and fatigue. he arrived in maine on may 20 after being treated for a blood
infection. his wife died last month. global news, 24 hours a day on air and on tictoc on twitter. powered by more than 2700 journalists and analysts in more than 120 countries. scarlet: live from bloomberg world headquarters -- shery: life from bloomberg world headquarters. --top: we are joined by stories we are following. shery: green on the screen. stocks rallied more than 1%. badno deal is better than a deal. justin trudeau says he would let rather than accept
hardline demands from washington. plus, a new home on the canadian securities exchange. we talked to adam bierman about going public. a quick check of the major averages. 1.3% while the s&p 500 is being led higher by financials. treasury yields rebounding above 2.8% while the nasdaq is up about 1%. vonnie: and i'm looking at the canadian dollar, after the bank of canada did not increase for the -- meeting in a row. the statement did appear to be more hawkish than anticipated. one strategist is saying that it
is a warning shot that the july rate hike is a solid possibility. negotiations over trade are ongoing as well. canada's foreign minister is saying there is no timeline, and she will not be tied down to any kind of timeline, that she will stick to the goal of a good deal. let's also take a look at some of our other partners' currencies. peso, though an bit stronger, and a weaker stronger in today's session but still at the 640 handle. , causeway ketterer capital ceo. she joins us from los angeles. i want to start with italy. one of your holdings, a value holding, is one of the italian banks. we had another value investors say it is time to buy more. >> i would agree with that. my colleagues and i like that. bank, and they
have a large business in germany and central europe. namely poland. the best part of unicredit, which exemplifies what happened with many european financials yesterday and in this still tough time for value investing in 2018 is that stocks very -- vary. tangible book value, there is significant u.s. bank anywhere near that valuation. to get a good business recapitalized, raising payout for investors, well-positioned, operating across europe. and it is cheap. note, the charts on the g tv library show plummeting, also -- deeply in oversold territory. what happens if the ecb bond
buying conclusion gets delayed because of these uncertainties in italy and spain? may not just be the other way around. we think the european central draghi, willrio likely want to leave having curtailed this negative short-term rate policy and stabilizing the euro zone. part of what is happening now in response to the concern about italy is the weakening of the concern -- weakening of the euro versus the dollar, which helps the central bank. -- we havecelerate two major central banks, the u.s. in a tightening mode and the european central bank tapering its monetary expansion pretty much in sync. that bodes, ultimately, quite well for, we think, value stocks. there will be so much less indiscriminate hiding and
chasing of the last gasp of growth. are you actually adding to positions in the current volatility? it might go away soon. to stick with the income stocks, the ones that can return more capital to shareholders. about 2018ferent from a value perspective is that we can get low beta. funds lowerd mutual sensitivity toss equity markets, which we believe is needed in this late cycle environment. such as which ones and where, geographically? telecommunications in asia would be at the top of the list. lowest beta. kddi inould include
second-largest mobile -- company has been buying back to percent of their shares outstanding this year. next year.o it again great business model, offering e-commerce and payments along with telecommunication services, and you get those stocks at 11 times next year's earnings, a 3.5% dividend yield for japan. company'ss largest -- 800 million customers, well-suited for 5g telephony. these are such that -- companies with such financial strength that you can't miss. shery: thank you. coming up, cannabis gets a bump. we speak with medmen ceo adam bierman ongoing public.
vonnie: this is bloomberg markets. shery: cannabis company medmen goes public in canada with a valuation of $1.65 billion as marijuana companies look to other countries for growth. joining us is adam bierman. first, give us your reasoning going to canada and not the united states. >> we cannot list in the united states, the public market share will not have us.
likeund toronto, and everything we've done in the last 8.5 years, we've taken advantage of the opportunities that present themselves. employees, have 800 18 licensed facilities. what will this new capital allow you to do? >> it does not change much. we continue to be consistently focused on the mission at hand, the most important market at hand. vonnie: can you focus? just kidding. if we were to get unfocused, it would have in the last 8.5 years. we happen to be in the three most important marijuana markets on the planet earth, california, new york, las vegas nevada. nothing really changes except for the first time, investors get to own a piece of the largest u.s. we'd company --
weed company. it will create more evangelists singing from the mountain tops that this is a permanent industry. -- said $75 billion+ in the u.s.. vonnie: what do you think the potential value of the market could be in the united states? adam: like anything we do, why not? why not create more marijuana users as a substitute for alcohol? why not have it be the exit to the opiate crisis? i think there is so much potential untapped. vonnie: we saw cannabis growth recently list on the new york stock exchange. do you see the trend of these companies coming to the united states, and would you consider migrating to the u.s.? of course. ultimately, i would love to ring the bell in new york. and as prohibition ends, i think
that opportunity will present itself, but it is not a distraction right now. we are happy to be public in canada. shery: are you opening shops in canada? adam: we have a joint venture with a group listed on nasdaq. we are opening retail in canada. vonnie: you said you are not actually going to do anything with the capital, except to add to existing facilities. >> we will continue exit -- continue executing on our planned. nothing fundamentally changes. m&a are youkind of looking for? are you looking for retail, facilities to grow, raw materials? >> every market we are in, we are vertically integrated. a factory where we grow cannabis and manufacture marijuana products. and we have retail stores in the best locations and markets.
we bolster the assets we have as we continue m&a. we have real infrastructure in new york, and we will bolster on top. if your neighbor, new jersey, is about to legalize, that is a market. shery: how favorable is the landscape right now? is the word.tic on one hand, two thirds of americans want legal pot. of medicalfavor marijuana. from a federal perspective, we still have this illegal. the contradiction between federal and state laws allows for tremendous opportunity. vonnie: what does it give you being the first movers? mover,ot the very first but at the same time, you want to do the most, and this is a commodity. what differentiates the product you sell? >> i think we've been fortunate
and have executed in our first mover position. we locked up the best retail positions in the best markets. the eventual motives retail. >> what is your market share right now? >> global market share, i think it is too nacent. in,he three markets we are we represent over half the addressable market in the united states, the dominant player in all three markets. vonnie: what does that mean after -- as far as figures? >> check-in after our first call. adam bierman is medmen ceo and cofounder. and stayingrade with canada, justin trudeau says canada would rather see nafta die than accept the u.s.'s hardline demands. he said he would only sign a deal that is good for his country, but all three parties
should look for a compromise. we continue to believe deeply there is a win-win-win opportunity for canada, mexico, and the united states. we are continuing to work constructively with the united states and mexico to do that. we know that trade is a powerful lever to create opportunities and jobs and growth. we understand there is an in largebout trade segments of the population that don't feel it has worked well for them. that is why, as a country, we've been working hard to make a case for trade, that we can sign where weve trade deals that issuesrated like protection of the environment, gender equality, workers rights are integral in
treating the success of trade deals to create growth. >> how you think it will affect the summit if the united states just slaps tariffs on canadian steel? >> i think that is a step back on what the -- what it is focused on. the g7 is fundamentally a to talk about- e economic cenges we have across theone shared developed world. how do you reassure people that all the changes we are going through in our workplaces, from automation to ai to greater trade deals and globalization in general, how were these factors going to ensure that the growth is fairly shared by
everyone? in any trade deal, there are always ways to look for compromises, ways to understand we can get to a win-win-win. but i have also said clearly that i will stand up for canadian interests. i will only sign a deal that is good for canada, and no nafta is better than a bad deal, and we've made that very clear with the president. speakingstin trudeau with bloomberg's head of economics. republicans pitch their tax plan as a boon to the middle class. companies using their savings to create jobs and raise wages. after the fourth quarter has cleared, that's not exactly where the money is going. ♪
bloomberg business flash, a look at some of the biggest business stories in the news. andman sachs has unveiled application that could help protect companies from corporate waivers. they have been developing the jupiter program to erase the company's vulnerability to activists. says it will foot the college built for its u.s. workforce. can can5 million employees pursue an associate or bachelor's degree in business or supply chain management at three nonprofit schools. this is part of walmart's latest -- to improve employee retention and engagement. the u.s. economy grew at a softer 2.2% in the first quarter. original reports called for 2.3%. slowdown in- consumer spending and build up
in inventory. total the economy's output of goods and services. that is your business flash update. we move on to our next story. vonnie: taxpayers giving america's companies $30 billion .n their first quarter they are not spending the money the wake president trump said they would. how they spent their savings in the first quarter. what did you find? $30 billion, where did it go? biggercally, the pie got and they are spending in similar ways. the republicans and the president pitched this as a way to spur investment in the country. what we are seeing is that buybacks,penditures, things a company would spend on increasing cash reserves, all increased to ratios that are
similar to previous years. buybacks are at an all-time high, but the market cap and s&p are the same. lot, but are up by a as a ratio to cash flow it is about the same. so while they are spending more on these things because they have more money, there has not been a shift at all in corporate behavior, which is the way this was pitched. if you are a republicans or democrat, you can maybe take victories on either side, but the short story is nothing has changed. shery: you can see that it has not changed the way corporations spend, but would you say it is too early to tell? this tax passage just opened in december. >> that is one of the caveats. quickly can you expect these changes to affect corporate behavior? and a lot of -- isreporting has been
doing this, but the big picture that it is all up because they have more money, it could take years to figure out if this has caused a change. we haven't heard anything since those one-time bonuses in the beginning, including quarterly conference call outlooks, which we are through for the second quarter. if not now, at all? happen.uld one thing we saw in the compensation of wages in the first quarter, they increased a little more than in the fourth order. some people are talking about the bonuses. be seen how much will be floated to the employees. another big caveat is the economic cycle. low unemployment, a tight labor market? will they be reducing wages anyway? it is difficult to tell exactly what impact the tax cuts have. shery: what about capex?
look at the ratio of what they are spending versus their cash flows, it is similar to the five-year average. again, if you say are at an capex areigh -- say at an all-time high, it takes years to plan. what you said, the pie is bigger but the proportions are the same as before. you can catch all of our interviews on the bloomberg by typing in the function tv . markets continues next. ♪
let's get a quick check on the markets as we await those headlines. s&p 500 up by 1.3%, recovering from yesterday's decline. bonds have recovered -- bonds are backed it 2.85%. headlines have just crossed, the one i'm focused on is the federal as reserve -- the federal reserve says -- expanded . the economy is doing better, but clearly, the question for toestors and for the fed is really dig down into the intensifying inflation pressures we've seen at the start of the year and whether that continues in march and april. the federal reserve will be using the data collected from the beige book for their meeting in june. julia: we didn't get that last time, the fact that we are seeking a tightness in the labor market.
acknowledgeg -- that the labor market remains tight, that worker shortages remain, that the outlook is upbeat. i'm looking to see if we can find anything as far as inflation. we would also like confirmation of -- picks up. scarlet: i'm looking at some of the anecdotes that jordan picks up from the beige book. broadway theaters reportedly raise their prices more than 10% from one year earlier, and -- in boston says higher fuel prices shipping costs. we can see it percolate through different parts of the country, certainly in austin and new york. julia: gains remain modest in most districts. shery: let's check in with julie
hyman. julie: we are seeing a steadiness, not much a reaction to the beige book report. it's sort of fleshes out but doesn't give us anything that is absolutely new. to still support the thesis that the fed is going to raise rates in june, based on the picture of an improving economy, a bit of an uptake from the view we saw from the last beige book report. dow and s&p are neck and neck in gains, butrcentage in terms of small caps, growth is outpacing them both. that has been characterizing recent action where we see the russell reach new levels as the larger cap averages have not maintained their records. we are also seeing swings coming back to the s&p 500 to some extent.
we had things quiet down several as larget seeing volatility. then yesterday, back to back moves of more than 1%. it -- holds true, if a look at the treasury market to see what kind of reaction we are seeing in the bond market. a broad retracement is what we are seeing. big 15 basis point drop in yields yesterday, regaining another seven basis points. this clears to be holding steady in the wake of the beige book reports. ,'m looking at the intraday pretty much a stable move in the wake of that report. this appears to be mostly a sort of reaction both. one of the individual groups we are watching includes the apartment real estate investment trust.
the thesis being that as we see rates going back up, this could be negative for homeownership and people taking out new mortgages, and would instead benefit renters and companies that own rental properties. they are on the rise in today's session. if you look mortgage applications, i have the data on my bloomberg, mortgage averages were down -- mortgage applications were down for the -- straight week. were the driving force behind yesterday's session, and they are playing a big role once again today. julia: let's get your first word news update with mark crumpton. mark: a turn of events in ukraine where russian journalist and prominent kremlin critic -- showed up alive and well at a news conference. national police have said that he was shot and killed yesterday .
ukraine says it staged the murder in a plot to ensnare potential killers after claims that russia offered to pay $40,000 to have him assassinated. authorities say those behind the real assassination plot have been apprehended. friends and relatives of the 72 victims of last year's inferno --the london -- tower have pay tribute to loved ones. -- to prevent similar tragedies. was born two months prematurely after -- recovered and is with her husband today. >> -- to continue this, my wife.
she's made of the hardest material i know of. without her strength and courage, i would not be here. mark: one of the criticisms following the fire was the revelation that the building's exterior was retrofitted with flammable -- emergedibilities have to form a new government, an option he says he would like to give a chance to see if a political compromise could still be possible. the former imf executive had been order to form a and renewedvernment elections, three days after the antiestablishment five-star movement and the anti-immigrant league party walked away from their last attempts to form a coalition.
global news 24 hours a day and twitter, i'm mark crumpton, this is bloomberg. , contained or contagion? after betterlizing demands than expected, but political chaos is not going away anytime soon. establishment and antiestablishment parties continue to bump heads, leaving people to wonder whether the fallout will be contained just in europe. here to discuss is ashwin alankar. were you surprised by the basis we sawglobal yesterday, particularly when it comes to u.s. fixed income? ashwin: i was not so surprised. we all have this natural fighter flight instinct, and yesterday instead of fighting, we fled.
the key question to ask ourselves is, is this deja vu of european sovereign debt crisis? our fears of painful contagions spreading globally or not? we believe they are not warranted. as a starting point, let's look at what the markets themselves are telling us about the future state of the world. a great place to get that forward-looking information is , verytions market where quickly, the price of a call option gives you great information about future upside and the price of a put option gives you great information about potential downside. today's pricing of calls and puts, they are painting a gloomy picture when it comes to european equities, or the downside risk to european relegated to any
potential upside. pricing ofes to the the attractiveness of non-european equities, the picture is optimistic. you are seeing the trade-off between potential upside versus potential downside, very favorable outside europe. this divergence is not consistent with contagions. at the cashlook market and you see how to year yields on the italian conference have come down quite a bit. are we saying that the market is mispriced or accurately priced if we don't think this is a 2011 type situation? and in order to justify seeing a full hike priced out of the u.s. market this year, that feels like an overreaction based on what you are saying. ashwin: yes, i think yesterday was an overreaction.
i do believe that when it comes arehe bond markets, they driven structurally more by economics, by inflation, by gdp. political uncertainty comes and goes. i'm not so worried by yesterday's reaction, by today's reversal. we have to ask ourselves, why do the crisis isay more contained than in, say, 2011? it is obvious that fundamentally, the european economy -- the non-european economies are in a much better position than in the past. more importantly, i do not believe we should ignore the stark difference between monetary conditions, between the past and present, and most notably the fact that the ecb is holding a much greater share of peripheral european debt today than it was at any time during the 2011 crisis, thereby
limiting supply to foreign holders of that debt and private holders. that do?oes what is the mechanism and how does it act? it acts as a way of quarantineing any potential -- any potential lows. if you can't get your hands on that debt, it can't hurt you. that is one of the major reasons we believe this crisis will be more contained than in 2011. scarlet: it is clear the conditions are different. if today's auction is any different, there's plenty of demand for the five-year and 10 year debt. keeping this in mind, how do you position yourself? what is the trade when it comes to european sovereign debt or fixed income overall? ashwin: i think the trade is you have to be careful when it comes to peripheral european debt. you have to be careful when it comes to the euro.
political uncertainty is here to stay for the short-term. you don't want to get in the way of that political uncertainty. realize that mark to market losses or gains can be very violent. the key question when it comes to fixed income markets now is, what is the trajectory of real yields that is, treasury when you strip out inflation going forward? we strongly believe those yields will rise, structurally. we are not afraid of the fact that they are rising or of the level they sit at. but what has is concerned is the path they take. if real rates rise in a chaotic, , that is very different than if they rise in a calm and organized fashion. thate fact -- so the path interest rates take is what you
soundbite." flying back and forth. put some logic to this, kevin. who is saying what, and what matters? kevin: the trump administration doubling down on their notion of taking an aggressive stance with this ongoing bilateral -- as wilbur ross is set to go to china as early as this weekend. we should note that this comes on the heels of president trump announcing he would like to increase by 20 5%, up to $50 billion worth of tariffs on chinese technological goods. that has really let to a divide between steven mnuchin and peter -- mnuchin said that the trade war was "on hold." >> that was an unfortunate
soundbite. basically for two reasons. we are havingat with china is a trade dispute, plain and simple. they engage in a range of unfair a $270ractices, run-up billion trade surplus with us which costs us one million factory jobs per year. kevin: not only is their divisiveness within the white house economic team, but back-and-forth between the u.s. and china. the chinese foreign ministry spokeswoman saying that every flip-flop in international relations simply depletes a country's credibility. this comes as the president is facing trade pressure on six fronts from china, south korea, -- eu, japan julia: we keep coming back to the issue of trust and credibility. what are we thinking as far as the talks in beijing in the next
two days, and the talks set to take place on june 2? are these still on? kevin: all of this appears to still be on, but these talks are fragile to say the least. we should know that in the interview with bloomberg news, justin trudeau saying he doesn't even want a deal on nafta if it is not good enough for canada. it would not necessarily be a bad thing for the base of the trump movement, because there's so much doubt with regard to some of these trade agreements. julia: too many voices. our thanks to kevin cirilli. i believe the garden is being cut, if you can hear that noise in the background. scarlet: remember how many people showed up at beijing? julia: different views,
julia: this is bloomberg markets. thelet: it is time for bloomberg business flash, a look at some of the biggest business stories in the news. black rock advising the university of california on private equity deals, -- black rock has even assigned an executive to the investing office in oakland. they are expected to double their investment in private equities to over $9 billion this year. salesforce provides software ondemand and beat -- growth across all units.
several wall street analysts raised races on the stock. -- is expected to benefit from -- itsrgan deciding to sell women's health and antibiotic divisions. conducting a strategic review of business. they areest own for their wrinkle treatment botox. shares have fallen 32% in the last year. that is your business flash update. amazon ceo jeff bezos says the company will handle increased government scrutiny with flying colors. annual meeting in their hometown of seattle. investors,s -- activists, and protesters. we are just looking at the five-year chart of amazon's share price. he's not doing badly and neither are shareholders.
yet some people out there would like to see those roles separated. how welcoming is he going to be of that view? >> there was a group here protesting outside. some of them had signs that said bezos needs a boss. on the half ofke the proposal saying that amazon should not be structured this way with the board chairman also serving as ceo. recommended that shareholders bump that proposal --n, and it lost money 7% lost 27%. the main argument of the board of trustees was to look at amazon performance. we've done so well under the existing structure, don't mess with success. right, don't fix it if it is not broken.
the appears to be broken is way that alexa is reporting conversations people are holding in their homes. i know this is a minor story and that it only happened to one couple as far as we know. of it raises the question what this technology will be used for in the future. as this,? -- has this come up? spencer: it seems to a faded over the weekend, where a couple in oregon was having a conversation. they heard from the person saying, unplug yourlexa device, you've been hacked. deviceexplained that the picked up a series of missed messageke up and sent a to a certain person. it was a frightening and alarming event, especially since the private conversation was sent to a third party, but it did not come up in the meeting today.
it is something amazon has to minimize going forward. theirid talk about devices and the popularity of the alexa voice-activated platform. they will have to prevent these things from recurring if people will have confidence in these devices. julia: fortunately, they were talking about wooden flooring. it could've been worse. talk to us about some of the government tensions. the president has been vocal about what taxes amazon's pays -- what taxes amazon pays, and postage in the post office. was that discussed in the meeting? if so, how? spencer: briefly, the notion of .ntitrust concerns came up someone broached the topic with bezos directly. the framework is that amazon is the world's biggest
online retailer, expanding at expanding, how big can it get? listen, we ares, huge now. we have grown from 30,000 employees in 2010 to nearly 600,000 today. we should expect and welcome government scrutiny. that amazon will make sure that when the scrutiny comes, it will pass with flying colors. don't worry about it, expected to be there, but we will pass with flying colors. scarlet: thank you so much. the fireworks spectacular, one of america does it most beloved traditions. details just ahead. ♪
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scarlet: one of july for's most patriotic traditions is the boston pops at the banks of the charles river in for the second year in a row bloomberg will host the event as a major media partner and a sponsor. this year seems to be better than last year, with all staff lineup.an all-star way of alix steel into the conductor of the boston pops. >> think is so much, so great to talk with you, keith. we are looking for to july. tell us about the celebrities who will be performing this year. keith: we are excited about this year, and of course excited that bloomberg will be our partners once again and we will see you on the stage. this year, in addition to the amazing boston pops, which remains the center of our celebration, we are rich in -- we are welcoming rachel platinum song, stage, her huge
fight song, which made a lot of people very happy. we love what she is going to bring for the fourth of july. we also have the indigo girls, classic rockers. and really exciting, rita marino, she will be joining us as part of our tribute to leonard bernstein. she won the academy award for her portrayal of anita in "west side story." >> i'm a musical theater lover, so that headline got me excited. talk to me about the fact that it is all women this year, that seems like a fun idea. what is the significance of that? weith: leo is trying to -- always try to give diverse entertainment, things that will appeal to the wide and diverse audience that we have, but this year has been an interesting year in the way that women's voices have been heard, perhaps in ways they had not been previously.
it was not accidental, but we think within this group not only are they all female, but more importantly they are incredible entertainers and did they come from a really wide variety of musical styles and endeavors background -- and diverse background themselves. >> you have modern singers, musical theater, talk to me about what went into that collaboration as well. keith: well, it is a ways for us. we have half a million plus sitting live on the banks of the charles, watching the concert, as well as we hope millions more on the bloomberg network, and on bloomberg.com. and that audience ranges from babes in arms to grandparents and everybody in between, and a huge friday of americans from all walks of life. what we try to do is make sure there is a moment in the concert that everybody says, that moment was for me. if i can do that, i know i've done my job. >> fair enough, the highlight
last year was mitchell, he was an incredible singer and a wonderful experience. what was your highlight for last year and what do you expect it to be this year? tough-- keith: that is a one. some of the great things last year, one of them was our new relationship with you guys and all the fun we had together doing this great birthday party on the banks of the charles in boston. besides stokes, whom i have known for years, i enjoyed getting to know andy grammer, really upbeat positive energy kind of guy and we have had him back since then because of the little child we had together 11 months ago -- trial we had together 11 month ago. >> what about this year? keith: that is like deciding between your children. what up we have put together. the indigo girls are lovely and
i have worked with them before, they are great. i met rachel platinum just a couple of months ago and what a sweetie. i love that song. it is my eight-year-old's favorite song so maybe i have to prefer her. and rana is such a fascinating talent. i think the lineup is strong. as fellow music theater geek, i have to say getting to work with rita moreno who has been a legend for half a century, she is probably my favorite. >> and still performing fed one reason why -- still performing. one reason will be featured is because of the tribune to leonard bernstein. what went into that thinking this year? >> he was born 100 years ago this august in lawrence, massachusetts. theme with the boston line into harvard and he lived in roxbury and then moved to brooklyn and other parts of boston, so he is
also, on top of that, boston pops was one of the first concert he came to. conducted by arthur fiedler in 1933. the first time he stood at a podium in front of an orchestra was with the boston pops in 1941, so we feel we have some claim to really join with the rest of the musical world and celebrate perhaps the most influential american classical musician ever. >> really looking forward to it, see you in a couple weeks. we are getting ready every here. we are excited. keith lockhart, the conductor of the boston pops. scarlet: thank you. mark your calendars. bex, with others, will hosting at 8:00 p.m. eastern on the fourth across our multimedia platforms, bloomberg radio, bloomberg.com, boston.com and a boston globe.com. julia: you sound super excited.
[laughter] scarlet: i am. julia: now an update with mark crumpton. mark: president trump signed a right to try act today, allowing terminally ill americans to test medication that has not been fully approved by the food and drug administration. meantime, the president says he expects news from the u.s. drug industry within the next two weeks. >> i have some big, some of the big german companies -- drug companies in two weeks, and they will announce voluntary massive drops in prices. mark: the right to try act also expands access to life-saving treatments, years before patients would normally have been able to access them. president trump is going after his own attorney general again. in a series of tweets, he said he wished he had a picked somebody other than jeff sessions. expressed hisly frequently --
expressed his unhappiness that he recuse himself from the investigation. today, additional records about the deadliest mass shooting in modern u.s. history. for the courts order the release of public records, including police body camera video, dispatch logs, witness accounts and officer reports from the october when shooting that killed 58 people, and wounded hundreds of others on the las vegas strip. the authorities maintain that the shooter acted alone, but are yet to determine a motive. in pakistan, residents struggling to keep cool as the temperatures hover around 111 degrees fahrenheit. officials have set up cooling stations to provide relief for commuters. the heat wave comes as many in the mo -- in the country are observing ramadan. global news, 24 hours a day on air and on tictoc, powered by over 2700 journalists and analysts in more than 120 countries. i'm markrumpton -- crumpton. this is bloomberg.
come the we see investors are reassessing the action today with a rebound rally for stocks and a pullback for bonds. in fact, the reverse of yesterday's trading session when stocks dropped and bonds rallied. but the year yield dropped in a big way, today we see a higher anwe are iersely the yield. d very adjusting about yesterday's trading action, the yen was much stronger than stocks. take a look at the chart, you can view the chart using the function. we are looking at blue, the 10 year yield, white is s&p 500 going into the brexit. on brexit, a huge haven bid. 10 year yields dropped and the days.0 shed 5% in two yesterday we had the equivalent drop for the 10 year yield, but the s&p 500 dropped 1%, so one question could be whether or not there is more selling ahead for stocks. to talk about this, we want to gan.g in eric du
think you for joining us. you only trade -- this chart said -- you said remind you of the german bund. we will have your chart here. eric: yes, so it was interesting when you sent out your tweet yesterday about the rather we had in u.s. treasuries -- rally we had in u.s. treasuries, we believe this is a macro dynamic flowchart and we were not surprised by this, because of the breakout we saw in the bid on february 16. you can see clearly here, range extension up, settling for the highs. one of the largest days in quite some time. and we, as time progressed, mid-march, april, then again may 18 and may 28, so another breakout. you can see the chart here to the upside. so the bund precedes the
bonds in the tenure and we use it as an indicator for stock volatility. >> it tells you that treasuries are likely to rally on a risk off and stocks would trade lower. let's bring in some other macro signals by taking a look at some of this, the five-day chart. in youhe german dax, and love the s&p 500. there is friday. eric: ironically the last time i was a was may 9, crude led the way higher in the s&p. so today, or rather yesterday, crude led it the way down. last friday we had a slide, about three dollars, this is crude on friday. we saw the move down. we had the holiday, however the dax and nikkei were open. you saw them come from the crew to move. s&p 500 opened on tuesday. confirmed what we saw in crude. and we saw the new lows after europe went home yesterday, the level was approximately 2696, we
got short. there was capitulation to the downside, recovery before the close. we were flat, waited for a new day. and clearly, being nimble, this allows us to adjust the narrative of the market and that is what we did and today we are long. >> let's take a look at the chart, so you can get more granular with the levels. here is yesterday and today, talk about a roller coaster. crude last friday lead you to go short, now today you are long. eric: today, is significant rally off of the lows in the s&p, crude led the way higher today. there was not a significant move in the global equity markets, so what better market to use than the s&p. it opened higher, held unchanged. we literally started anticipating a further move up, hfter we traded 32010 -- throug
2710. if you looked at the chart, you would see that this level was a serious point of support. we gotthen resistant, through and off to the races from here. >> great analysis by eric. how to trade the s&p 500 futures. julia: great work. time for the stock of the hour. after thence surging, american cancer society updated guidelines for prolonged cancer screenings that trim the age to 45 years. columnist dave wilson joins us with now. good to have you with us. where did he go from, to what extent has that's why did up -- has widened this up? dave: the cancer society recommended that people start getting the colon cancer screenings at age 50, now talking about five years earlier. it reflects an increasen colon
cancer and also rectal cancer. ,nd mrs. exact science's pet and it is designed specifically to find out if people are predisposed to having these kinds of cancers. sort of a natural beneficiary of the recommendation. scarlet: so the cancer society makes the recommendation, but does it mean more business for a company like exact science, who has a design for this? dave: up with them in a good position. this test was approved in 2014 and you see that the revenue has risen on a quarter to quarter basis, every quarter since the test was first sold. and they are posting losses now, but analysts are looking for profits to start flowing in 2020. this means 22 million more americans would be in a position to have the screening. so you figure that this company
is in a position to benefit from that, perhaps more than others. withe talking about tests samples, you do not have to do prep work, you do not go to a doctor's office, there is a convenience to it you do not have with other tests. julia: so a huge argument the company makes, people are embarrassed to go to the doctor and this is a test they can do at home themselves. we have a history with this company. tackled by -- a long time ago. may of last year. david: this is a company that has been growing, and it has always been equation of whether the shares are outpacing the growth, and that is why citroen get interested. since theis up 90% conversation. scarlet: more now. got it. great to chat with you. coming up, my conversation with
scarlet: this is "bloomberg markets." let's turn to the business of sports.. the nfl got down to business last week, when the league revealed a new policy on the national anthem. how are the teams going to enforce the rules? i put that question to al guido, president of the 49ers. it was a wide ranging conversation and i began about talking about the new partnership with a soccer team, think of it as football meets football. al: we are believers in what they are doing, they are a historic brand. unfortunately they have gone through ownership changes and we just bought back the stadium, which was key for us. they have a built-in fan base that is very passionate, 40,000
fans every game for a championship level team, so we believe if we can bring the things we learned inside of the nfl within the stadium, the fan experience, then strategically, yes qamar our games are different, but generally with the fans want are the same. they want a tremendous experience. that is looking like what we will do with them. scarlet: this will be felt on the field, just not financially? al: we are putting capital into this ownership, it is not just strategic. we are working with the ownership group about infrastructure. and our goal, like every team in the division league, is to get to the english premier league. to do that you have to be really smart, because it is not as easy as it might be in the nfl, where you benefit from being a bad team, by getting a better draft pick. english soccer is actually different. it is hard to get up, but once you get up, the question is how do you stay. scarlet: you may have to trust the process. let's talk about the new ruling,
what does this mean for the 49ers specifically, what kind of preparation as a franchise are you making in anticipation of the proposed constitutional amendment passing in california? al: i am gambling. first and foremost, it starts with our league. roger goodell said the most important thing is the integrity of the game. that must be paramount. if there's ever a point where they do not believe in the integrity of the game, then we will have lost our way. on our side of the ledger, the question becomes, what technology of a structured to we have in the stadium. and if gambling becomes legal, can you operate it at scale? they were the current partners outside of that space that might be there? we have a strategic operation inside of the 49ers, the largest business in all of sports. we are working right now on all the pillars that would be impacted within our stadium and within our content, within the betting side, so for us we are excited about this. we would like the federal
government to take a stance on this, not just the state level. scarlet: you are referring to the national framework. al: yes, federal governing, instead of state-by-state. we hope it happens. scarlet: talk about the national anthem policy, because with the specific rules, it states that teams can punish players however they see fit. how do the 49ers plan on handling this, given the city's progressive leanings, and the fact it was colin kaepernick who led the way in choosing that moment to protest against social and justices? al: we have been at the forefront of this, not just, cabinet, but our owner. he abstained from the vote, because he thought there was a better process to this. million back$10 into the community in the bay area to enhance and talk about communicating social justice causes. our relationship with the police force has never been better. the money we are investing on
that site is fantastic. so i cannot speak for the leak, but we are turning protested the progress. we need open lines of communication. we are doing that on a daily basis. scarlet: a lot of critics say that too much has been conflated in this debate, including patriotism and whether players are being patriotic. they say the nfl brought this on themselves, by using patriotism as a marketing tool, complete with military flyovers. is there an argument to be made that the best chance the 49ers can take is to be as apolitical as possible? al: there is an argument for that, certainly. when they did the other day with the ruling, you know, we should not profit during that time. if we mandate the players stand, than the concession stand should not be open when we are selling food and beverage, because that is hypocritical. we will take the stance, if that moment is important, and should
be important around the entire stadium. scarlet: are the 49ers discussing not doing paid military marketing? al: we have not and we do not on a consistent basis. we do not believe it is part of our business model. i will say to the broader question, we believe it is important for us to be in the community. we do not believe it is just important to be a football team. we are a large part of the community on a daily basis. our players' kids go to school there. so we are involved in education, we are involved with the police, with the military. team, we are a 365 not just playing 10 home games and moving out of town. scarlet: that was al guido, president of the 49ers. julia: thank you. the fed haseased its proposal for easing of open roles tring limits and vote is being held today at t meeting, that kicking off a 60 day public comment period. calls for the removal of a major
assumption that was included in the original rules, that say that any position that letters hold for fewer than 60 days are considered propriety. i think the key line from this, that attempts to broaden and a simple fighting to tailor the rules without negatively affecting the safety of banks. the question is, will the viewers believe that? i was doing a quick business flash? no. scarlet: a look ahead. we have ideals report. activist investor jonathan -- is making another bid. he has the support of two key shareholder advisor groups. how will that unfold? next. this is bloomberg. ♪
julia: i am julia chatterley. scarlet: i'm scarlet: i'm scarlet fu. welcome to bloomberg markets. julia:♪ julia: we are live in bloomberg world headquarters in new york over the next hour. regainingkets assets in italy encouraging economic data help steady nerves. around the world, pushing back against the president posits tariff -- proposal. influentialhe most figures in central banker -- banking is not a central banker. from trading, let's check on julie hyman. >> exactly. briefly after facebook
and saw heading sideways on their. very slight upward trajectory is taking them to highs after they indicated the fed was seeing more strengthening in the economy, particularly in manufacturing. yesterday, weling have four stocks falling for everyone rising in the s&p 500. 31 stocks in the s&p at the moment. you look at the imap and see the groups higher today, tech is up the lease and still gaining. pretty substantial here financials, health care, real estate, cymer staples, all of those up by at least 1% in today's session. is the interplay between assets calling some of the gains today. if you take a look across assets here, you see the move in the 10 by 15 basisown
points in a single session yesterday. it is not regaining as much as earlier in the session. the basis points helping financials. the dollar somewhat week down by half of 1%. that appears to be helping oil prices. that was in turn helping oil stocks, the energies of you are just watching. part of the reason for the really dramatic treasuries action is shorts on treasuries are still very high. this was brought to the editor of the live blog on bloomberg and this was the commercial futures position in the 10 year treasuries. the line between net long and net short. positions in the 10 year treasury market going into the political crisis. that is why you saw short covering in the market that exacerbated the move yesterday.
a quick -- a quick look, a dramatic move, beating estimates managing its inventory and gross margins approving shares of 25%. out with ancoming and gross margins and sales up 28% in the first quarter. we have out with an and gross margins and sales up 28% in the first quarter. we have got michael kors, the margins on the flipside. that action generating less revenue than anticipated. outfinally, she goes as well. first-quarter earnings also missed estimates and its second comparable sales down in the low to mid single digits. scarlet: a mixed bag for retailers. thank you. let's get to mark crumpton. mark: thank you. the white house announced a series of final steps leading up to the planned june 12 summit with north korea's tim cook --
kim jong-un. kim young told will meet with secretary of state mike pompeo .his week with talks japanese prime minister abe meeting in washington on june 7. a delegation meeting with korean officials in the demilitarized zone on the peninsula and a second team is courtney majestic's singapore, the venue of the summit. the former trump advisor steve bannon calls angela merkel's migration policy incompetent. he told the german weekly that eukel's exposed other countries migrants. an action party -- that vilifies her, is on the right track. emmanuel macron says he hopes europe can work out their fight on tariffs. macron spoke with caroline in paris.
>> i do my best at what i can do. >> the prosecutor's office in st. louis will drop a felony charge of computer data tampering against governor eric now that the governor has announced his resignation. attorney kim announced that decision today a day after the surprise announcement that he would step down effective friday. a donoraccused of using lists from the veterans charity founded. the mission continues for his 2016 gubernatorial campaign. global news 24 hours a day on air and on tick tock on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. scarlet: thank you. second time's a charm?
no. that is the third time. after jonathan hoping he does not have to wait as long. shares are down about 17% this year as u.s. prepares for the annual general meeting. chinese now is at hammond. chances are better this time? >> they did last time. last time with very similar proposals. strategic reviews, maybe doing something with management. last time, he lost a vote -- came outbecause and they made concessions. he narrowly lost the vote. this time, he will potentially come back and win it we do not know yet. an interesting and is i was heking through proxies and was going about 1.8% of the shares because that is what he but since then, he
sold down his position quite a lot, by about one quarter. he will vote a lot of shares he technically does not own at this point which is interesting. >> we know why? >> we don't. i was messaging him earlier to get clarification but we don't care what is interesting is pushingtivists had been .he company to do a sale this would have been a different complexion tomorrow. they are also out now so you really have -- you're left with a small position. will get -- it will be tight. >> some of the best properties in the market space, we know this is a transitional sector in particular. the fact that they are down 17% this year enough of a catalyst? maybe we will accept the change? >> that is the argument. he has done these before. tons of people and a lot is going on.
what explains it, it can only be management. from that point of view, he has a case at he has made the art that consistently for about two years. point to his track record when he was an analyst and get this. a crazy number, 23 consecutive ratings on the stock when the stock rent from 20 to 40 -- 20 to 47. he doesn't understand the business. shareholders have conflicting analyses. >> i like with julia said. it is in transition, a polite way of putting it. a lot of these guys are fighting for their survival. >> they are. you are right. british. an industry with a ton of pressure.
the bigger trend was that people just do not like them as much as they used to. shoppers of the younger generation -- fortnight hereay they don't go to the mall. fortnight here they don't go to the mall. >> the other thing is you see a lot is you see a lot of activists getting into the space. it used be more special. really the only game in town. the mainstream activists have piled in and that is causing a lot of headaches from the management team and a lot of m&a. we have seen a lot come into play. in if heeone else step does not make it to the board? >> it is probably unlikely. the fact that he has probably explored options and nothing has happened, it is difficult. >> an element of stubbornness. dealss the bloomberg reporter. ,he fed government meeting
associates explains why he believes this is a value opportunity. >> quite clearly, prices have moved in a different direction in value. whenever that happens, it provides opportunity. europe in particular especially over the last decade, we kind of ounce to from problems to issues to crises. really opportunity for those who are long-term value seekers to make money. the value does not at all move in the same direction as price. when this faction's, you can position yourself appropriately. opportunistic an time to try and take advantage emotion.rkets again, the changes in value are not as all anywhere near -- not at all anywhere near the price. >> give us an idea of where you
are taking those opportunities? is it italy,is it italy, specifn financials where you already had positions? >> i think when you look at european financials, this is ground zero of price destruction. especially u.s. dollar terms were you had a week euro, but witness price destruction, which has not corresponded to value destruction, take italian banks. we believe it is an extremely high quality financial institution. there is a strong capital position extremely well managed. they are dealing with the that debt they didn't have in portfolio. really turned things around in the last four or five years. this yields it or 9% today. trades in price-to-earnings multiples, it is probably off
the course of 20% in the past week as the result of these issues that the market presumes will hurt. tesla is a default on italian debt and perhaps italy is leading in the euro, which we is an extremely low probability. is an extremely>> that was davg earlier on bloomberg. >> thank you. business business stories in the news. down earlier this month after joining business business stories in the in 2016. they did not respond to a request for comment. the ceo referred to courtney as a rock star. black is advising the university of california on deals. the agreement allows blackrock to buy stakes in competitors
such as blackstone group. blackrock could
even assign the executive to the investing office in oakland. expected to more than double investment in private equity from around $4 billion to over $9 billion this year. thethe college bill for u.s. workforce. the retail passes 1.5 million employees will associate all bachelor degrees in management at three nonprofit schools. , and engagement. that is your business flash update. we will talk more about this on what did you miss. >> we're talking about the fed power player. he funds the influential think tank that is now home to formal fed just former fed officials.
we're joined now with more. how did the
story come about? york were covering the new fed presidents search. , the sanjohn williams francisco fed president, to head up the fed hit when it happened, the brookings institution came out with a strong response which made a lot of sense. they are all friends with him and it was perfectly logical. it is the first time that this guy, the nexus of the power of the fed, he funds a center home to former officials. essentially, he did. he did not go out and recruit them himself. a former wall street journal editor and the leader of the hudgins enter, heavy-handed recruiting both janet yellen the for her. the farmer most recent fed
shares. we thought it was pretty >> one of the obvious things for me was the criticism for the nomination here. i.e., it is the same old story, and older white man instead of something different. reinforces groupthink. you have all of these familiar faces. >> it was a question we were trying to answer with the story. the center itself has been criticized occasionally of being an echo chamber where the fed has accepted it to be right. of people say no, this is a form for transparent the date it out on webcast programs where the public can access them. there is a segment of the
population that thinks it reinforces the consensus. it certainly is not challenging it the way we see them do. >> birth of a feather flock together. great story. pretty fascinating. let's move on. you can go to g tv . you can find all of the exciting charts you can see on bloomberg tv. keyk on them to catch up on analysis and save charts for future reference. awhats on tap today, i love this chart from abail earlier. great colors let it -- nevermind the interesting infmaon. a great comparison, the fact that the stock selloff that we saw was not as intense as the rally we solid treasuries yesterday. on, if you look at the charts, look, the opportunity is just presenting itself.
>> time now for options insight was julie hyman. julie: mimi today fractions in sight, alone -- volatility came back for one day yesterday. yesterdayou seeing and what is the follow-through? we are still seeing a continuation of a market low-end complacency is still out there. has been spoken about and it has escalated over the weekend but people inc. it is contained. they're trying to kick the can down the road now. basically, the effects, we spoke three weeks ago and people are still not in the position, exposure is still lower and it is pretty neutral. so we great decent spike
are thinking people are not really long bond right now. still doing a lot of overwriting. >> what kind of activity are you seeing? >> option volumes are a lot lower and banks are being a lot more aggressive. customer strategy analysis, and we are fighting hard to win the battles but we are seeing people be more aggressive to capture the share and potentially lose money. tesla isng of which, a the options play or looking at today and you are looking at a calendar play. if there is a trade on this, i'm sure people thought about it as it is a scrutinized company. how are you looking to play the clash of sentiments around that?
>> we have been looking at tesla for a while. a huge battle name. is a bit of a no man's land and we're for sing on the short side for three reasons. if you look at even three weeks ago in california came out with a solar panel announced and, it stops going up on good news. we are seeing a neckline resistance. oppenheimer has a performance rating on it. it should be good resistance and we're using support. around and that is why we are seeing this on foot here. it is an iced trade and we are ok selling the call. finances through the short policy with the fractured $59 price could be resistance coming out depending on the hedges. we're using september because
there is high-end competition displays and i do not think people are pricing that in. we're still on one time in is --ber here it september. and we want to have time here, we do not know when or how it will happen, but it does -- if it unravels and given elon's potential mental health concerns, there are enough things that could happen and it could collapse quickly. >> got you. and assertive directional trade but with little time to play out. thank you very much. back to you guys. >> thank you. coming up, an exclusive interview you do not want to miss. joining bloomberg taber get it
:00 eastern. a look at the markets quickly. no one is calling back today. equity markets rallying in a session versus the losses we saw yesterday as far as the nasdaq is concerned. can see the s&p 500 up 1%. canning halfback, 1.9 is the , more than 2% today and adding some base's points. >> there is no need for a safe haven today. >> exactly. ♪ ♪
mark cohen islamic state says man who killed people mark cohen islamic state says man who killed people tuesday is a soldier of the caliphate. meantime, the attack, which killed two female police officers, a terrorist murderer. reportedly murdered another person t night before and was also serving a prison sentee and was on an authorized leave. wilbur ross calls the wto updated and says the amount of time to resolve this dispute is a joke. secretary ross spoke today at a form in paris and says the mindset is that anything a next order chooses to do is fine. the prime minister for macedonia name for his country will be put to next year. one year since he took office, he said that athens