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tv   Bloomberg Markets Americas  Bloomberg  May 10, 2019 1:30pm-3:30pm EDT

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on $200 billion in chinese goods, and beijing promised to retaliate. talks wrapped without a deal but steven mnuchin described the discussions as constructive. china's top negotiators said the talks went fairly well. earlier today, president trump said there was no need to rush a deal. the pentagon says it is reallocating $1.5 billion to help pay for construction of 80 miles of wall at the u.s. mexico border. the money is being drawn from savings and numerous defense programs, including ones that support the afghan army and other security forces. in march, the pentagon transferred $1 billion from army personnel budget accounts to support construction. france's ambassador to the united nations said the security council is concern over the recent escalation in fighting in syria's northwestern province. he told reporters at the u.n. today that after eight months of relative calm, military
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operations have resumed, resulting in a this placement of civilians. >> we need to send a very clear message to all those who might be tempted by an escalation. happens, is that if it then you will have a humanitarian catastrophe there. will destroy you the perspective of a political process. violences past week's threatens a crumbling cease-fire agreement reached between turkey searussia at the black resort of sochi last september. it agreement averted a potentially devastating assault by the syrian government. in houston, a powerful storm has done heavy rain and golf ball-sized hail on the city, flooding streets, and forcing officials to close schools. there is no relief in sight. another round of storms is
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forecast for tonight and early saturday. houston is prone to flooding because the city has insufficient drainage and has experienced rapid development reducing wetlands. global news 24 hours a day, on-air, and @tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. >> live from bloomberg world headquarters in new york, i'm vonnie quinn. amanda: live in toronto, i'm amanda lang. welcome to "bloomberg markets." here are our top stories that we are following from around the world. uber's ipo is off to a slow start, a rare decline for a high profile ipo as the ride-hailing firm the incidence next chapter
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as a public company. u.s. and chinese officials wrap up high-level trade talks, avoiding a negotiation breakdown, even as president trump boosted tariffs on $200 billion worth of goods from china. bag full of dirty cash. an update on a money-laundering scheme fueling a housing boom in canada. quick check on the major averages. we are seeing markets, session ,ows, have been trading weaker fearful or run as trade negotiations and comments from president trump. commentary from steven mnuchin and his chinese counterparts. we are still seeing the s&p 500 tracking for what could be the worst week of the year. we did see rate sensitive stocks higher as betting about tariff fears meant that the federal reserve may mean it is lowering before raising rates. a quick look at those sectors hardest hit by tariffs.
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five of the top 10 are tech-related. if they stay in place, it will be rough for the sectors. vonnie: exactly. of theking at uber, one biggest micro-stories of the day, went public about three dollars below its ipo price. now down less than 1%. dara khosrowshahi really expressing the fact that they are interested in long-term investor that will buy and hold. snapshot.ust a he painted the day as a massive success, they were able to come to market at all. amanda: of course they did come to market. parent some of those losses. earlier, emily chang spoke to the ceo dara khosrowshahi on the floor of the stock exchange about the move. >> you cannot pick when you go public. you can control how you execute as a company. are you building a great
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service, are you bringing in happy consumers all over the world? we are going to focus on what we can control. profitability is a very significant priority for us. the great companies of the world can grow, but they can grow off of a base of their internal capital. that is absolutely the goal for us. we don't want to be dependent on public markets for capital. he is a huge shareholder, has been responsible for creating enormous value. i don't think this company could be where it is without travis' efforts. amanda: let's turn to morningstar's senior analyst. one thing that is clear, not losing money but it is not offering a profit anytime soon. the amazon model, if you will. what is the expectation of what you are willing to stomach here? >> we have modeled it in a way that we think uber will become
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profitable by 2024. certain things that they can take advantage of. they have a huge user base in terms of riders, which is attracting drivers. they have created that network affect. moat source as we refer to it. whether it is rise or food delivery, increasing on the top form. the cost per transaction will go down. we think the acquisition cost of each rider will also decline. all of that will lead to wider margin expansion and profitability probably by 2024. vonnie: you say the driver base is the moat. if that's the case, how do they retain these drivers that are striking, protesting, in some cases, having to sleep in their cars to make a living wage? >> that's a good question. it is tough. the network effect i described is on both sides.
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, andemand side, the rider, the supply side, the drivers. you have, thes more opportunity it means for drivers to make money. in some of the demand that drivers have, it remains to be or lyftther either uber will settle with the drivers. it also remains to be seen how , ormunis or government state or federal levels will approach this. we think both uber and lyft will be able to find a solution for this. given the demand continues to be high for their services, we think they will still benefit from either providing a higher take rate or actually stabilizing the pricing on their services. one more thing, we have seen
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indications of pricing stabilization. if you paid attention to lyft's q1 earnings call, they are seeing signs that prices are stabilizing, more rationality behind pricing. amanda: back to the comparison between those two. raisech can uber due to its pricing, pass on the higher driver pay to the customer, if it is competing with lyft? are they head to head combustor -- competitors, or is lyft out in front? >> in the u.s., we see them as competitors. it has become a duopoly in the u.s. there is more rationality behind where either side does not necessarily see the benefit of discounting the pricing too much, too aggressively cutting prices. then, that brings about stabilization in pricing.
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both parties are realizing, it we stabilize prices, both companies in this so-called duopoly will benefit. vonnie: thank you, ali. it has certainly not been a smooth ride to the ipo for uber. missteps along the way, mainly tied to former ceo travis kalanick. the current ceo dara khosrowshahi had a message for his employees ahead of the trading debut. as we move he wrote, from a private to a public company, no doubt our jobs will become harder and all eyes will be on us. the markets will keep their version of the score and value of what we build but our true north will be determined over the long-term. joining us now for more is the managing partner of green briar partners, and former head of communications for the americas at uber. what would you advise now, do they have a reputation problem
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still? >> thank you for having me. the first thing that will happen is all the current and former employees will take a break. today is a day to reflect on how much has been accomplished in the past eight years and to look forward for the company. the question is does the there is a next -- yesterday impact what happens tomorrow? like so many companies before will be on how things impact the stock price, not just rumor and speculation. amanda: there is a lot of bad pr that is current, especially around drivers, their treatment, also brewing regulatory issues that we have alluded to. on the driver side, how damaging the driver is not making a living wage? >> the driver protest, initiallyn that was discussed ahead of that protest, are very different.
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for the most part, drivers like working on the plot or. about its drivers, they are the lifeblood of the business. they are the ones that help to build the company from the ground up. those challenges are temporary. as the company grows and matures, they will find a way to stabilize their relationship. vonnie: now that uber is a public company, how much more shareholders and institutions have on the way that uber governs itself? what i'm really asking is, should travis kalanick be on the board? >> travis is ultimately responsible for creating a brand that has impacted almost every corner of the planet. although there has been challenges in leadership, the fact remains that the team he built is largely there today. if you look at the bell ring today, most of those employees have been there from the start. i think we have the best days ahead of us.
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today is just a good foundation for what is next. amanda: we have alluded to the regulatory hurdles that face uber, costly when you consider musicality by municipality, state by state, country by country. how big of an obstacle is that? >> fortunately, there is a long history of companies both here and abroad that have been challenged by regulations. if you look at some of the big telecoms, utilities, they are heavily regulated, and they have worked overtime to make sure those regulations do not impede their ability to be profitable. i think we will see something similar in uber's future. it is a young company and the future looks bright but we should expect continued challenges and discussions about regulations in municipalities, states, governments across the world. that is the nature of politics and business. lane, obviously a
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positive message you are putting out there about uber, but it is a public company, has other a i'm curious, what do they do with $8 billion raised? >> good question. we will see over earnings how the markets are reacting to the business and the decisions it is making. no doubt the board will continue to be important to the direction that the company charts. but time remains to be seen. only a few hours into the trading. there is a lot more that we will learn about the business in the years to come. amanda: in terms of where you think this company can go, we have seen a lot of innovation around parts of the business, uber eats being the biggest. are there other opportunities ahead for uber? >> that is one of the most
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important comments we can make today. it's about time that we started looking at uber as a platform company. we should not be comparing it to other industry players, whether in the ridesharing space, micro mobility, or food delivery space. uber does it all. whether we are talking about autonomous vehicles or helicopter taxis, it is up to uber to create value in its platform. that is what investors are interested in. as a former employee and current shareholder, that is what i'm interested in. amanda: we appreciate it. coming up, a loll in the trade war. talks between the u.s. and china are being characterized as constructive. we will bring you the latest, next. this is bloomberg. ♪
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amanda: this is "bloomberg markets." i'm amanda lang in toronto. vonnie: i'm vonnie quinn in new york. amanda: u.s. trade talks. steven mnuchin described the talks as constructive. china's liu he described the talks as going fairly well. now there are reports that they will hold teacher meetings in beijing. for the latest we have sarah mcgregor from washington following all the developments. a bit of a yo-yo in terms of the implications of the trump tweet. no hurry to get a deal and then constructive talks. what do you make of what you are hearing? >> as you said, talks are wrapped up in washington. the negotiation did not collapse but there still is no deal, that is what we know officially. what our sources are telling us, and the comments from steven mnuchin that the talks were constructive, glosses over the fact that sources are telling us that the u.s. has given china three or four weeks to come back and reach an agreement, or donald trump go ahead with his threat to add more tariffs on $325 billion of chinese goods, virtually all imports from china to the u.s. while we have good news that the talks seem to be a thing, they will progress, there is this at a threat now. vonnie: we are hearing from the that china and the u.s. will hold a future meeting in beijing. future does not really paying it down, but it sounds like there is an avenue to getting a deal. from what happened
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this morning, from the president's tweets, that china was not backing down, and would just accept what they were offering? what our sources tell us -- and these are sources who are secretly speaking to us. they did not come with a lot of concessions, anything to really give the u.s. any idea that they are any further along in the talks. of course in the past week, the u.s. that china reneged on some of the commitments it had made, changing the laws to conform to some forced technology transfer, ip. even if it is one more week or one more month, it is hard to imagine how they will find common ground on these big issues. we have more breathing room now, but it is hard to see how this will play out at the very moment. amanda: can we take comfort from the fact that the north america free trade renegotiations, that
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the president tends to react badly for changes in negotiations? par for the course. everyone negotiating the deal says nothing unusual. is it possible that they are making more progress than the tweets would suggest? >> absolutely. the usmca is a perfect example of that. trump constantly threatened to walk away from that deal, still is, unless he can get congress to pass it. some of these threats have to be taken with a grain of salt. but what we know is that trump escalated tariffs on midnight on friday. threatening to escalate further on virtually all chinese goods. this is real. this is the kind of thing that can really impact economies and deteriorate trade talks. vonnie: sarah mcgregor, thank you. following all the trade ins and outs. coming up, thousands of canadian properties-identified in a dirty
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money probe that estimates about $5 billion was laundered. this is bloomberg. ♪
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47nda: it is estimated some billion dollars of dirty money was laundered across canada last year. of that, $5 billion may have been laundered in real estate in vancouver. natalie is with us now. one reason why people care so deeply about that story is the expectation that that may have raised prices 5%. money laundering is not a victimless crime, it has an impact on the economy. >> that is right. the latest figures are really startling. more than $7 billion may have flowed through the provincial economy, not just in real estate but in luxury cars, casinos.
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the panel that came out with a report yesterday estimated that the impact on housing prices in , could have raised prices by as much as 7%. that is based on the fact that that figure of $5 billion accounted for 4.6% of total transactions in the province last year. it is really insane some of the properties identified in the dirty money probe, penthouses, ski chalets in whistler, holiday retreats. where is this money coming from? great question. i bet the regulators in law enforcement would love to know that. one of the factors that did go into modeling this exercise was trying to exercise where flows can be. obviously, because of vancouver and bc's ties to east asian
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economies, some of that is believed to be coming from china and other economies out there. but it is very difficult to ascertain exactly how much, in part, because it depends on the kind of crime statistics disclosed in that economy. that said, some of the anecdotal evidence shows this money is coming in pretty much from everywhere. mexican cartels. there was one example of a $3.5 million island that was linked to a $90 million investment scam in india. basically, bc has been open to all. amanda: quickly, we should note bc was the third biggest offender. alberta wa and toronto were the others. do we know where the rest of it goes? >> short answer is no.
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the point is, this is clearly a candida problem, not a bc problem. there is a reason canada is her first two in law enforcement as snow washing. circulated through its somewhat upright economy and comes out somewhat pristine. this is a nationwide problem. vonnie: thank you, natalie. a phenomenal story. i would urge everyone to read it. you can catch all of our interviews on the bloomberg with the function tv . it is uber day. you can catch the interview with dara khosrowshahi there. this is bloomberg. ♪
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♪ mark: i'm mark crumpton with bloomberg's first word news. president trump says trade talks between china and the united states are continuing in what he describes as a very congenial manner, despite new tariffs the
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u.s. imposed today on $200 billion of chinese imports, and beijing has promised to retaliate. a memorandum was signed of space cooperation. commerce secretary wilbur ross primehey shared the evil -- equal blame with china for the u.s. trade deficit. single half of our trade deficit comes from automotive, and the other comes from the geographic area, and that is called china. so in order to reduce our trade deficit, one of the big objectives of this dealistration, we needs to with china as an entity and we need to deal with automotive as a product line. secretary ross gave president trump a report on the auto situation a few months ago, when ross said he expected the president to make a decision on
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the contents of the report by the end of the 18th of may. iran says there will not be any talks with the united states a day after president trump said he would like iran's leaders to call him. a top military commander said there will be no negotiations with america. the u.s. has been rationing up -- ratcheting up economic pressure on iran and sent an aircraft character to the region. charges will not be filed against the suspects of denver school shooting until next week. they were scheduled to appear in court today, but the hearing has been delayed. an 18-year-old male student and a 16-year-old female are accused of opening fire on two classrooms at the stem school highlands ranch, killing one student and wounding eight others. the district attorney's office is considering whether the younger suspect will be charged as an adult. no motive has been determined. global news, 24 hours a day, on air and at tictoc on twitter, powered by more than 2700
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journalists and analysts in over 120 countries. i'm mark crumpton, this is bloomberg. caroline: it's 2:00 p.m. in new york, 7:00 p.m. in london. live from bloomberg's world headquarters, i'm caroline hyde. scarlet: and i'm scarlet fu. caroline: the u.s. benchmark remains on track for its worst five-day performance of the year, and the dollar weakens after consumer prices rise. debbie downer -- uber falls on its first day of trading, leaving the company's market value below its last private funding round. and that's a wrap. the u.s. and china leave this week's trade talks without a deal after president trump added -- added onion tariffs to 200 billion dollars
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worth of chinese goods. will the chinese retaliate? markets seem to have shrugged off the concerns about the trade war and the new tariffs, because we have come way back off our lows. the worstopped 1.6%, week in 2019. but it is a little change. caroline: we did see a rally in china. shanghai, sure, the big state related funds are doing some of the buying, but we saw asia and europe rally. the u.s. was the downbeat area, and they are shrugging it off today. scarlet: the national team starting to support chinese stocks, and the etf that tracks those stocks of .5%. that tracks oil services is slumping to a four month low, because of headlines that iran might target u.s. oil production infrastructure. we will keep an eye on that and keep an eye on uber. caroline: not a good day to be going public. scarlet: let's dive into today's
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action with our market reporters. about the am thinking s&p 500 on the week. we have a big reversal on the on towards the upside, but the week, still the worst week for the s&p 500 of the year since december of last year. trade tensions weighing on it, and the s&p 500 this time last week of 18% on the week, so investors taking ships off the table. this chart that we have looked at so many times, look at this chart to see how it is performing. it suggests more weakness could be ahead. it goes back to december 2017, and we see this entire time period is arranged between the bulls and the bears. no side is winning as the stock 2600, 2800, 2900 on the upside. this week back down in that range, at one point yesterday and today below the 50 day moving average. take a look at the rsi momentum indicator, moving back down. we could see the s&p 500 dropped down until at least the middle
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of the range, maybe even more. this chart for the s&p 500 is near to medium term bearish. i want to go back to the trade discussion here. although we are seeing a rebound in the broader indexes, there are some individual movers that are suffering. this is not just about the tariffs being put into place, this is about sentiment and long-term planning, capex planning. caterpillar is an lamenting of that issue, because a lot of their entities and customers have to make decisions long-term. caterpillar down about 6%, deere having one of its worst weeks since october. the ceo of cnh industrial was on bloomberg yesterday, and basically said that the current trajectory of the trade talks could be catastrophic. he is referring to this general idea as to what it is not -- as to it is not what is happening now, but whether there is some certainty to the long-term picture. right now that doesn't exist.
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i want to look at the far makers here. this is the bloomberg nowcultural spot index, down to its lowest levels since 1972. when you think about the pressure that has been on farmers and a lot of those folks and caterpillar machines, they are not getting the prices they need, trickling down into farm income. eventually, that trickles into pushing down their orders and profitability for a lot of those companies. we so? -- lisa? take a look at the yield curve. it is continuing to flatten today. at one point going about one basis point from zero, from in version. this is the yield curve that the federal reserve looks at to gauge whether we are heading closer to a downturn. typically, an inversion proceed the downturn in the economy by about 12 months. this is a gap between 10 year and three-month treasury yields. there is a bit of a bearish
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indicator today, cpi, core inflation coming in today. lower than people expected for the month of april, edifying what the federal reserve has been talking about, which is they see no reason to hike rates didif anything, today you see markets price in a greater likelihood that the federal reserve would be compelled to cut rates at some point within the next 12 months. definitely some cooling sentiment around global growth as the trade negotiations gets drawn out. great setup. let's talk more about trade, because the u.s. and chinese trade negotiations ramping up today without a deal. steven mnuchin described the talks as constructive. we are joined now by shaun donovan and catherine gray feld. john, first to you. no deal, but no breakdown. what is the mood music like in washington? shaun: there is the public mood
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music, then there is the mood music inside the negotiating room and the u.s. trade representative's office, and that is gloomier than the public face put out there by treasury secretary steven mnuchin. he has been often calling talks productive, doing it last week , orr they left beijing constructive, and that has masked some harder differences in the negotiating room. we are told over the last two days, these negotiations basically got nowhere. the only thing that we have ended up with is a threat from the u.s. side for more tariffs in the next three to four weeks on chinese goods. the rest of chinese imports, $325 billion that president trump has been talking about, if the chinese do not bend in some way. and according to people who have been briefed on what happening in the negotiation room, he showed no sign of bending.
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he is going back to beijing with a message and some heinz takes negotiations -- high-stakes negotiations that will becoming back. no went to the trade wars -- no and to the trade worse today in washington. scarlet: no to the trade wars, end tothe market -- no the trade wars, but the market shrugging it off. china has threatened to retaliate, but they have not specified how. have a couple different options here, one of them to weaken its currency. >> it is probably unlikely that try to see china go dollar for dollar on the u.s. tariffs, given they have to raise a 25% tariff on all of their u.s. imports. that is why people are thinking, should they retaliate? which they vowed to do. soybeans,d to currencies, treasuries, they have options here. is washington,
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bracing itself for a reaction from china? is trump acknowledging the effect it has had on his hallowed share price rally? shawn: we have seen an interesting dance from the president over the past few days. you have to look at twitter and his presence there this morning to see him try to do two things. one, a p tough on china and say he was holding the line and praising the benefits of tariffs on the u.s. economy, that is a new theme we are hearing from him, and also by mitigating some of the economic damage for farmers, promising he would use the income from tariffs to buy up the crops of farmers and maybe shift that oversees to of thee starving poor world, in what would be kind of a remarkable move towards a real state directed purchase scheme, the kind of thing we normally see china do. balance, oreing him oe a really hard balance
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here between the domestic politics, which are pushing him to be hard on china, and the domestic economics, which come from business and farmers and so on who do not want him to do too much damage at home. scarlet: speaking of toeing the mentionedatherine treasuries. china might have some options there, because it is the biggest owner of u.s. treasuries. talk about that possibility? katherine: it is a nuclear option. it would absolutely get trump's attention. china owns 1.2 trillion dollars worth of treasuries. if they were to sell a significant portion of that, that would absolutely disrupt the u.s. bond market. at the same time, that would be painful for china. it is such a big holding that they probably cannot get rid of it all in one go, and were they to sell a portion and cause ales,ke in the u.s. s
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it would reduce their remaining holdings. china has the largest toward of currency reserves, and there are not a lot of good options for where else they could go outside of u.s. assets. scarlet: perhaps that is why they have not come back with a response just yet. katherine greifeld, thank you so much, along with shawn donnan, joining us from washington. credit suisse's chief equity derivatives strategist is with us now. mandy, the indexes have come back to unchanged, and the nasdaq is holding onto a loss of one point 25%. was there any indication in derivatives that suggested we would make up for today's losses? marketshe scheme in the throughout this year was complacency. we highlighted as late as last week emerging market volatility was at a one year low. week'scan say is the headlines, markets were not expecting it. given the price action, i would say investors are still fairly
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complacent and fairly optimistic around risks of trade. caroline: we haven't seen enough buying of protection, from your perspective? mandy: we have seen more. emerging-market vols have spiked, we have seen emerging volatility in vix options, which is a big change versus q4 of last year, so vix options this -- hit over two point this weekend over 2.4 million contracts. scarlet: we are not going to get a resolution to this next trade the -- to this trade war in next day or week. what does this look like going forward as people reprice the fact that it is going to take a while? mandy: you will see some normalization of the volatility, given that the immediate catalyst is removed, but medium to longer term uncertainty has gone up. we will have to see what the ramifications are from an economic perspective. i would expect a normalization to occur, but
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maybe longer dated, medium to longer dated dollar tilde the being slow to normalize -- longer dated volatility being slow to normalize. caroline: we were talking about it slight inversion in the vix curve, to some extent, and the last time it happened, before q4 fell off. does anything signal in the current market situation that we could be headed to that sort of situation? are we going to see some breakdown of liquidity, particularly in the equity market? they: never say never, but position this time is quite different. client positioning is different. in q4, investors were in a weak position, crowded in tech as it sold off, causing massive deleveraging. there was not room to buy protection. this time, positioning is actually fairly light. fundsors -- most hedge are up on the year but still trailing the s&p, so they are not willing to allow the stock to give up that upside -- to
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sell out a stock to give up that upside, but they are spending premium on hedges, which is why we are seeing more demand for option hedges, rather than dumping futures or stock. scarlet: interesting. what are you seeing in terms of people underestimating as catalysts for more volatility going forward? we talked about trade not being something we expected, but what else could shake people out of their complacency? mandy: the biggest catalyst would be a change on the anroeconomic front or economic fundamental. i do not expect a big change in the near term, given that harris and -- itt tariffs will take time to work through the systems. it is the biggest driver, so everything is secondary to that. caroline: mandy, it is great to get you here. suisse. of credit up next, consumer spending on
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mother's day is expected to hit an all-time record. what the national retail federation is saying. ceo ashear from uber's h-share's start trading on the new york stock exchange. what he is saying about the road to profitability. and back in the game. the comeback plans for the xsl. this is bloomberg. ♪
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caroline: it's time for our top calls, a look at the key movers on the back of analyst recommendations. , being downgraded to a neutral with a $42 price target, citing disappointing earnings. analysts say traffic has increased, and [inaudible] currently down 15%.
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down,t, -- traded improving cash flow at $20 to deliver room to run. finally, bank of america upgrading ford to a by with a $14 price target. analyst john murphy citing -- in the north american market, along with restructuring assets and its global redesign. ford of almost 1%. scarlet: we are also keeping an eye on auction house is gearing up for the annual new york spring sales coming next week. works by monet,'s is on, roscoe monet, says on, and roscoe for sale in the next coming weeks. $1.3 billion. that is how much these works are
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expected to fetch when they go at 70's, hammer christie's, and philips. the new york spring sale is perhaps the most important auctions of the year, and competition for top work is fierce. this is key to driving interest, traffic, and can help the selling points across the board. at southwark these, this year's desk at southwar -- at sutherby's, this piece -- >> only 25 in the world, only four sold this century. this will be the highlight of modern expressionist painting. >> and how much in dollar terms? >> $55 million. >> that is so high. >> in my mind, that is a great value. >> who is likely to buy this piece? ormost likely an american someone from the eastern rim, but i do not rule out someone
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from europe or the middle east. soethby'ss -- attracts both buyers and sellers. they have increased the size of their space and dramatically altered how works can be displayed. lit well,art is presented well, curated well, the narrative around it is told well. the narrative can be with the collector, a collection that the and the story will be communicated better and people will pay more for the art. >> in recent years, sellers have turned to guarantees or minimum prices when auctioning their art. this year, those are down at sotheby's, suggesting new confidence in the health of the art market. another leading indicator is why those main options wrapped up earlier this year. >> wine sales are doing very, very well. art and jewelry are doing well,
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and wines recently did fantastically well. we feel very good about that. >> you are happy about this season and the year ahead. how far? on thee are focused season, we feel good about that. we are optimistic on the year. theigh numbers when auctioneers shout going, going, gone. scarlet: that was tad smith speaking with emma chandra. in the last couple of minutes, we have seen indexes go back into the red once again. we started off lower, crawled our way back, but did not hold on. caroline: the worst five days for the year. we are up slightly in volume, particularly for the nasdaq. ♪
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caroline: let's get you a quick check of the latest business flash headlines. for anr-busch has filed ipo of its asia unit that could raise at least $5 billion.
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hong kong offering help the world's largest beer maker reduce debt and drive acquisitions in the industry for growth. shares of the brewer of sam adams hit their highest price ever today, after announcing their acquisition of dog frisch -- dogfish head brewery. is slowingeer boom down. and the federal reserve's message that neutral inflation won't last, it is getting tougher. he consumer prices rose less than expected in april due to andless used-car clothing prices, missing estimates. and from consumer prices to one of the biggest consumer holidays in the u.s., mother's day. spending in the u.s. is expected to reach $25 billion this year. jewelry willrently be the number one thing
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purchased. i was also looking at experiential. we are going to be taken out for a nice outing, flowers, gift cards, clothing, but i do not think i will be getting many of them. scarlet: why is that? caroline: i got a picture for u.k. mother's day, but i am looking forward to u.s. mother's day. scarlet: oh, we have different days. i am surprised restaurants are not included in that spending chart. -- if you are like my family, it will be pushed off later in the month. my mother hates having brunch on mother's day because it is so crowded. push it later into the week. we have a lot to cover with you, including uber's first day of trading. this is the number. ♪
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at comcast, we didn't build the nation's largest gig-speed network just to make businesses run faster. we built it to help them go beyond. because beyond risk... welcome to the neighborhood, guys. there is reward. ♪ ♪ beyond work and life... who else could he be? there is the moment. beyond technology... there is human ingenuity. ♪ ♪ every day, comcast business is helping businesses go beyond the expected, to do the extraordinary.
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take your business beyond. mark: i'm mark crumpton with bloomberg's first word news. the chairman of the house judiciary committee says that shall counsel robert mueller will not appear before his panel next week. new york democrat jerrold nadler
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says negotiations continue with mueller and the justice department about the testimony and says the panel will subpoena mueller if necessary. democrats are clashing with the justice department over access to mueller's full report on the trump-russia investigation. u.s. and chinese negotiators held trade talks today and are increasing pressure after president trump raised tariffs on 200 billion dollars of chinese goods and beijing promised to retaliate. talks wrapped up without a deal, but treasury secretary steven mnuchin described the discussions as productive. china's top negotiators and the talks went fairly well. earlier today, president trump said there is no need to rush a deal. the latest weapons test in a -- inkorea suggesting north korea suggesting kim jong-un's regime has a new missile that poses threats to u.s. troops. twice in the last week, north korea has launched solid fuel
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short-range ballistic missiles that appear to be a local variation on a russian weapon. the missile could strike south korea and many of the 28,000 american troops there. global health officials are warning that if a tax on health crews in congo don't stop, the ebola outbreak there could become much worse. filings has escalated in the past nine months, crippling efforts to vaccinate those at risk, treat those who are sick, and bury the dead. or than 1000 people have died in this most recent outbreak. global news, more than 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton, this is bloomberg. caroline: from bloomberg's world
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headquarters in new york, this is bloomberg markets: the close. i'm caroline hyde. scarlet: i'm scarlet fu. debutaking it public today, and stumbling out of the gate, below its $46 a share offer price. emily chang spoke to uber's ceo from the floor of the new york stock exchange. the global player, the leader, and we are also getting into a number of different transportation cap tories -- categories. certainly, some people look at , theyd they went through go through tough openings, but i think for both companies, going thesecar ownership, all car use cases are enormous market. long-term, they can succeed, and i am sure we can as well. think you are you going to get losses below $1 billion a year?
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marketsve plenty of that are contribution margin positive, and i do think going forward, we can grow the business and improve margins. emily: lots of pages of risk factors, one of them which you may never be profitable. how much of a priority as profitability? >> profitability is a very significant priority for us. great countries of the world can grow, but they can grow off the base of an internal pathway, so to speak, and that is absolutely critical for us. we do not want to be dependent on public markets for capital. this was an important capital raise for us, but we believe that our business can and should be profitable over time. emily: let's talk about drivers. there was a big drivers strike this week, thousands striking around the world. they say they do not make a living wage. is there a way you could
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implement a living wage, a long-term plan to keep drivers more engaged and make them happy? you have over 3 million drivers and creators on your platform, it works out for some of them and it doesn't work out for others. what we do have to make sure is that the platform is a little too variable right now, and we want to make sure it works out for all of our partners, and that is what we are working towards. they are their own bosses, they can get on and off the platform anytime they want to. there is an enormous amount of flexibility, but also variability. we want to make sure every driver can be their own entrepreneur, and that the opportunity works out for them. we are adding, like son markets in -- like in some markets in europe, benefits like for pregnancy. on the things that our drivers and couriers wants, and long-term want them to get better and better. caroline: that was emily chang,
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speaking with uber's ceo. from dara saying the profitability is a priority now. is that at odds with the fact is thee company's vision amazon of mobility, and it has to invest in itself for a while to come? said a lot of things there. of course he will say probability is important, but he did say they are still going after car ownership. he did point to a couple of other metrics, contribution margin, cash flow as being sort of short on some targets before profitability. there is certainly going to be a lot of investor pressure to show earnings, to demonstrate that the business model can work, but i think if we were -- if over -- if uber chases those short-term
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profits, they will leave this opportunity, $2 trillion spent onthe united states per year cars, $20 billion are spent on over and lift. trillion dollar opportunity is going after the people in the suburbs, convincing people they do not need a primary car in populated areas. that is where he should be -- focusing.let: scarlet: that is something out of amazon's playbook, because jeff bezos has done this very well. how many ceos have tried to do what bezos has done, growing margins but saying hey, trust me on profitability, but failed? i can count one, and that is jeff bezos. but uber is one of those potentially once in a decade company like amazon was.
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hopefully they will not follow a we have playbook, finished our phase of losing money and we will focus on earnings. hopefully they will follow the bezos playbook. bezos did not say that he couldn't be profitable selling books, movies, electronics, let's consolidate and sell -- to our investors. instead, he kept doubling down, he kept plowing money back into gradually convincing us that more and more of our retail wallet should be spent through amazon. that is what dara needs to do with cooper, convincing people that more and more of the thousands of dollars they spend every year on personal transportation should flow through the uber platform. that is the long game. the disadvantaged are a has relative to jeff bezos is that he is not a founder-ceo. in some way, lyft has the
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advantage. john zimmerman and logan green do not have just the founder-ceo voting but they have control. it will be a harder road for uber, but they should not take their eye off the ball. it will have to be growth, growth, growth, behavior change, not profits or earnings. caroline: these companies are in some ways coming to the market too late, but should they have held off for longer? scarlet: good question. arun: i think they held off as long as they could. cooper was one of those companies that changed venture capital in that they sort of defined the breed of company that would raise the tens of billions of dollars before going public. they brought the private equity market, the venture investing in ways that are affecting wework, airbnb, and capital in china. but i don't think they have any time to sort of shield
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themselves any further rum the public market, because they have gotten so big. in some ways, perhaps it was a mistake to inflate the evaluations so much in 2015. i teach my undergraduate apprenticeships, there are risks to pushing your evaluation too high, too fast, because future raises become difficult. i normally don't think of $68 billion versus $76 billion. i'm thinking $10 billion or $20 billion. but it is a challenge. scarlet: clearly there is a lot of that has to be done in the meantime. the question to you, how many years can a growth company lose money before investors start to get impatient? or does it depend on the backdrop of a benign economic environment and the stock market climbing to new highs? arun: the key is to demonstrate momentum. amazon changed the playbook. you could have asked this question in the late 1990's, and
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no one would have said it is ok to do it for a decade or more as long as you are creating a $1 trillion company. now that we have that in the backdrop, the key is for uber to demonstrate they are meeting those aggressive growth targets, they are not spending the money competing for market share with lyft, but expanding the user base, the number of use cases, making steady progress towards the atomic, painting a picture of your is the goal post, it is 10 years away, but we are making steady and measurable progress and here, our contribution positive, so we could be profitable if you wanted us to, but we are not being forced to lose money. scarlet: so the metrics illustrating for itself that it does identify. arun sundararajan, thank you. arun: thank you. sticking with tech, the sectors best performing this year -- there are different ways to's life and dice it. in this weeks there's an etf for
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that, we highlight one fund that targets the cutting edge of innovation. >> the ishares exponential technologies etf trades under the slick ticker xt. it is considered one of the pioneer etf's when it comes to investing in companies tied with innovation. morningstar's definition of exponential tax -- companies with significant exposure to products that displace older technologies, create new potentialnd have the to generate significantly positive economic benefits. the fund is valuate stocks across nine tech themes, from big data and nanotechnology tenor neuroscience, robotics, and then tech -- and fintech. when it comes to allocation, the spoke fund is weighted more pharma,in biotech, big narrow tech, and computers. half -- the half
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its waiting in the u.s.. qualcomm, lam research,, and you tell a electric. it has grown to $2.5 billion, more than four times its size since launching in march 2014. and it has outperformed the broader u.s. market since then. with an expense ratio of 47 basis point, xt gets a green light in the bloomberg intelligence traffic light system, with a warning for its weighting.e scarlet: you can catch etf iq every we get 1:00 p.m. new york time. this is bloomberg. time. this is bloomberg.
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caroline: let's talk bonds, because investors are betting that emerging-market assets will be the worst hit if global trade tensions continue this summer. here with more perspective is lisa abramowicz. lisa: this is important to watch, because emerging markets are more closely correlated with china, as well as global growth. the implied volatility and increasedarket debt the most this year. this is the index of the jpmorgan emerging-market currency volatility index. thealso saw skittishness in $5 billion exchange traded fund that tracks local currency emerging-market debt.
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outflows since june of last year, and some of the longest streaks we have seen in a long time. you just have to think, what are some of the longer-lasting ramifications here, whether it is supplied change the -- supply chains, a merging markets don't have the same kind of trade relationships with developed markets, and also the potential for the dollar to yet again become a way to pay currency. what does that mean for the local currency denominated debt? it could be a bit of a problem going forward? scarlet: thank you so much, lisa. let's get to our stock of the hour, a decidedly less secure after its earnings. symantec cutting its first-quarter outlook after matching the street the last quarter. this is a move that may have cost the ceo his job. here with a look is dave wilson. that is a hefty decline. is, and it isinly not the first one. a year ago, the stock fell 33% in the day.
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the company disclosed a probe into their accounting, and they managed to settle that -- but here is the thing. in november, their president, michael fay, decided to leave. in january, their chief financial officer decided to leave. he is now leaving because they finally found his successor. he stayed on until they found his or placement. now it is the ceo's turn. you have this management turmoil amongst backdrop of results that in this case did not go over so well. that is certainly true for the fiscal fourth quarter. they could not beat on earnings, they could not beat on revenue, and by the way, the amounts they -- build the customers down 17% of a year ago, especially weaker in the corporate area, where accounts were about half the revenue. theyine: and we saw how performed on the year versus competitors, seriously underperforming. why aren't they billing more? it is interesting.
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they now have an interim ceo, richard hill. he talked about how the move was the cloud at symantec -- for the customers, it was much quicker than semantic thought it would -- been symantec thought it would be, so they had to play catch-up, and other companies came in and stole some of their business. caroline: give us a perspective daveat you think -- wilson, with a perspective on one of the worst performers in the s&p 500. scarlet: this is bloomberg. ♪
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scarlet: now to the business of sports. the excess alcon of the spring football league that vince mcmahon will relaunch and 20 secured deals3 with fox and espn.
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the tire comes after another spring football league folded quickly within a year. so what is the case for another spring football league? president and the ceo. here is what they said. >> we have the blessings of both time and resources to prepare properly. vision ofve the great vince mcmahon, and the perfect commissioner in the form of oliver luck. so reparation for our launch next february has been underway for months. it will continue for a few months more that we have left, but we are going to be ready to go and it is all going to be the results of good business planning and having the right people at the table, including this new partnership with elevate. scarlet: we will get to elevate in a moment. what is the biggest lesson the xfl learned from 2001? >> at this point it is focused
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on the fundamentals. it was a different point in time, the sports and the digital media industries were different. the football industry was different. this time around we are focused on the fundamentals. it is about bringing more football to the avid fans and others who love america's most popular game, and it will be about bringing people closer, opening up new points of access that have never been open up before. scarlet: operationally, will it owned by will teams be the leak, or will teams be owned by independent entities? >> we have eight teams to s by the league. we will have a business operations center in stanford, where we are headquartered, and it is their job to make sure each to has everything they need to be successful. scarlet: so what is the go to market strategy for selling these tickets for eight different teams? at the end of the day, the
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sports industry is driven by ticket sales and eyeballs. >> it is all driven by the fans. --ave known jeff really jeffrey for a little while, being in the business. what people are imagining on the field, we are thinking about off the field. jeffrey said, what is access to the players? how is a fan game day different as to what might be in the nfl? how do we use our digital and social channels, data to drive fan engagement? our partners and our big partnership with ticketmaster and live nation around content, we are going to take all of those learnings. a great part is our breadth. -- every a group single leak in every single brand. we will take learnings from how we go to market, but how we engage with fans is the real important piece here.
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it is advantageous given we are partnering with the league, we know the team presence and the coaches -- how do we give those fans something they can't get in any other league? with jeffrey's help, support, and vision, we will be able to provide behind-the-scenes touch points for every single one of our customers, whether they are at the youth level or corporate level. isrlet: it sounds like this not going to directly compete with the nfl. how much active cooperation will there be with the nfl? >> it is not about corporation at this point, it is our being a complement to the nfl. our focus is on providing more the 38 million avid football fans that want more after the super bowl and bringing to them a unique brand reallyball, but this is a complement to the nfl season, not a competitor to it. we are focused on doing things our way and complement in what the nfl does. scarlet: can you give me any
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hard numbers? the aaf had about $530,000 in , when it went bankrupt. how much do you need to do this right and turn a profit here? >> i do not have any hard numbers today. vince mcmahon has made a substantial commitment to standing up and launching the league, and giving us the opportunity and the resources we need to get to a point where we turn a profit. this is not going to happen in the first season or two, it is going to take some time, and our job is to really make sure that we are utilizing his resources as efficiently as possible. scarlet: so you are looking past the first year. are you setting aside runway money for year two or three? >> absolutely. caroline: a great conversation. scarlet: thank you, it was fun. caroline: and it is a pretty fun right if you are in it -- not so much for the nasdaq holders.
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underwater, but going green on the s&p and the dow jones industrial average. but it wasalmost 2%, the biggest pull on the s&p 500 and knocked it off by three points on its own. bitcoin, a great stat on bitcoin . it is the best run we have seen in particular for bitcoin since 2017. scarlet: so back as an encore related assets. and we are keeping an eye on uber, ipo-ing at $45, and has not traded anywhere near that level today. it did get at $45 as it opened, but since then it has been under $44 for most of the trading session area from new york, this is number. -- from new york this is bloomberg. ♪
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mark: i'm mark crumpton with bloomberg's first word news. the federal government reported 163 point billion -- $163 billion surplus, but even with
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the flood of tax receipts, the deficit so far this year is around 37.7% higher than a year ago. trump administration projected in march that this year's deficit will hit $1.1 trillion and will stay above $1 trillion for four straight years before starting to decline for the rest of the decade. says it isn reallocating $1.5 billion to help pay for construction for 80 miles of wall at the u.s.-mexico border. the money is being drawn from savings in numerous defense programs, including one that supports the afghan army and other security forces. in march, the pentagon transferred $1 billion from army personnel budget accounts for wall construction. france's ambassador to the united nations says they are concerned over the fighting in a northwestern province.
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after eight months of relative calm, military operations have resumed in syria, resulting in the displacement of civilians. >> we need to send a very clear message to all those who might be tempted by an escalation in syria. the worst is that if it could happen, you will have a high monetary and -- a humanitarian catastrophe there. on top of it, you will destroy the perspective of a political process. week movie violence threatens a crumbling cease-fire agreement reached between turkey lastussia in sochi september. the agreement diverted a potentially devastating assault by the syrian government to retake its city. in houston, a powerful city has dumped heavy rain and golf ball sized hail on the city, flooding the streets and forcing officials to close schools. there is no relief in sight.
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another round of store cast -- is forecast for late night and early saturday. houston is prone to flooding because the city has insufficient drainage and has experienced rapid development that reduced wetlands. global news, 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton, this is bloomberg. caroline: if 3:00 p.m. in new york, 8:00 p.m. in london. i'm caroline hyde scarlet:. scarlet: i'm scarlet fu -- caroline hyde. scarlet: and i'm scarlet fu. caroline: the dollar weakens after inflation rises less than expected. year -- downer.
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uber falls on its first day of trading, leaving the company's market value below its last private funding round. and that's a wrap. the u.s. and china leave this week's trade talks without a deal after president trump added tariffs to $200 billion worth of chinese goods. will the chinese retaliate? carlet: the s&p and the dow are in the green, the nasdaq barely down. caroline: and look at the vix, 19, 20, 20 one handle earlier, right back down to 16. everyone is bracing themselves, perhaps even up break down -- a breakdown between china and u.s. talks. scarlet: and you are seeing selling in treasuries, pushing the yield higher as well. the dollar has, for the most part, been weaker following the
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report, and that is the case against the south african rand. caroline: and election results seem to be coming out. the african national congress headed towards a victory, but it is about the factions within the a in -- the anc. scarlet: we will have more on that later on when we turn our discussion to emerging markets. in the meantime, let's get it check on what is driving today's market action. romaine gets us started. romain: i am watching uber. it is the most active stock on the day. we have been bouncing around ever since. 41.06 was the low end. we hit the $45 mark once, but that was a block trade of 100 shares. we have not seen any activity in that level. 44saw a trade come in at dollars $.75, but let's take a look at the volume. sharesan 150 million trading, a turnover value on the day of about $6.7 billion. that is well ahead of the
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at $5.9 we saw for lyft billion. we also see some names like pinterest, zoom, and trade web. this is also tied to the size of the ipo as well. and we look at alibaba and facebook, the two biggest ipos we had prior to today, during this bull run, turnover on both of those stocks on their first day of trading was about $25 billion for alibaba, $23 billion for facebook. thinking about the risk assets, not just stocks, but commodities as well. this is the bloomberg commodity index over the past month. on pays now for its worst week of the year, similar to the s&p first weekwn for the in a row since november of last year. we should care about this because stocks and commodities ultimately tend to trade together as risk assets.
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commodities often selloff for our bought earlier because they are less liquid, so they are harder to get into and out of. year in white, the s&p 500 in blue. last year, they were trading in a similar fashion. -- the commodity index was ahead of the s&p 500's all-time high, but take a look at the huge divergence that we see. the s&p 500 darting to follow the motto the index down. it will be interesting to track this. best case scenario, they meet in the middle, or it might be more bearish for the s&p 500. sara: it has been a rough week in the u.s., but it has been even harsher overseas when you look at chinese stocks. i want to take a look at the ftse chai for -- ftse china a 50 index. tracks the largest china a-shares companies.
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strip out today. the large gains that we saw before chinese date funds intervened in the market, the index was down 8%. that would be the worst week in over a year. there is an exchange traded fund that tracks the index as well, x fi. yesterday, we saw $100 million exit the fund, the largest single day outflows since 2016. back to you. is a greatarah, that jumping off point. we are going to delve down more into emerging markets, and the bull case for the emerging markets, which cerro was highlighting, some -- which sarah was highlighting. joining us now is our emerging-market debt fund portfolio manager. lovely to have you with us. some of the volatility has calm to today. the dollar is weaker and money is going back into emerging markets, but overall, how much
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does this rock investors in the emerging market space? does, but they fact that china and the u.s. engage in trade talks are a positive thing in the medium-term. i think short term, any wobbles that are caused because of trade should present a buying opportunity, because the political, economic, and financial market considerations are that we should have a deal in time. how long? our expectations are by g20, there should be enough momentum for a deal, and that will be positive for the markets. scarlet: how do you and other emerging-market investors look at the news flow? do you pay attention to what is coming out of the u.s., or do you look at what china is saying? >> absolutely. we have to pay attention to both. since president trump came to power, there has been an increased focus on the tweets, because emerging markets are at the receiving end of some of his
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tweets, especially as it concerns trade. at the same time, we have to pay attention to what comes out of china. certainly, but does it feel like the united states becomes more like an emerging market in the comments from the president can change on a dime? you have to treat it in a way that maybe you didn't four or five years ago. >> i think you are absolutely right. although the market is getting increasingly conditioned to some of the tweets that come out, unless there is a tweet that is truly market moving, where we were 90% closed in terms of closing the trade deal, talks are off and tariffs are back on, i think that certainly covers the stumble in the market. outside of that, we have to sort -- howss how to to find to find the policy signal within the noise, so to speak. scarlet: and -- caroline: and other areas of the market, vanguard, for example,
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saying indonesia, these markets could be hit. where do you see opportunities in credit to buy? >> broadly emerging markets, the macro environment, but the global central bank accommodations. that is certainly positive for the markets. i think the dollar has been more range bound outside of the recent set of the dollar, so that is very helpful. outside of the recessionary theth shock, i think valuation story in emerging markets versus both u.s. credit and u.s. equities looks quite attractive. certain places that we continue to like, again, selection in emerging markets is very important. one of them is south africa. we just had elections there, and although the full results won't be out until tomorrow morning, the early indications suggest that ramaphosa will have a sizable enough victory or margin
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of victory that gives him the political capital to move decisively forward in some of the structural and institutional reforms that are badly needed for the economy. how long before that starts to take shape in the corporate debt you are looking to purchase? there is certainly a story to drive these cap african assets, but when do you see these fundamentals to back it up? >> a large part of it is confidence coming back to the economy. animals, spirits, and the south african economy -- you have noticed over the past few years, the growth has been extremely sluggish, right? off confidence and private investment. i think the confidence boost, he will come back in a strengthened position where he can overcome some of the internal party opposition as well as the left party opposition.
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before, it was still below may be what the market expected, and i think that should enable him to move forward on even some of the anticorruption and -- that became news to south africa over the past few years. scarlet: coming up, after winning the bidding war for anadarko, the board of occidental faces its shareholders. and we hear from our interview with stacy coming him on the significance of uber's ipo. and the nation's biggest retailers begin reporting earnings next week. how trade tensions could hurt the group's outlook. from new york, this is bloomberg. ♪
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scarlet: time now for social climbers, the stock making waves
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in social media today. iphone agrees to acquire buckeye partners. the u.s. owner and operator of -- price tag, six point $5 billion. shares of buckeye are up at the moment, and over the past two days, up by 25%. next, viacom's revenue falling below $3 billion for the first time since 2010 while a resurgent paramount pictures robust perfect games -- drove s.s profit gain trading falling in its debut today after opening at the lowest ipo price. shares of the company opened at $42 while the stock was down 8%. those are your social climbers. caroline: we will be sticking with the uber theme, because movers public debut was not as pretty as many had hoped. we are here with ed hammond. how much is this going to put
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off the wannabes, the waiting in the wings, the airbnb's and weworks have been saying, we are looking for an ipo at some point. it was a bad day. ed: it was a bad day and it has been a bad market this week. , but --t as bad as lyft caroline: [inaudible] ed: and they had the benefit of pricing this into the weekend, so they get a few days of calling off. but for the really big private tech companies and you mentioned if you, there is not a big enough picture. scarlet: and we have a headline here from the president. he has called the china talks constructive, and says they will continue. so silence from the white house for much of this trade negotiation, but just right now with indexes at session highs, the president called the discussions, the white house discussions with china constructive, and says they will
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continue. will evenmaybe uber touchscreen. we are still at $42 a share, down 5.7%. if you are one of these big private companies, you don't have a choice. you can't stay private forever. the idea of someone coming in and acquiring you is not taken lightly. you do not want to look at these people on a day one or a weak one rating, but uber did price break. they watched what happened with said, let's pull in the reigns, which they did. scarlet: you also have to shed some light on anadarko and everything that has been happening there. for anyone who has been trying to keep up, it has been a soap opera. what is the latest? ed: it is a great one to cover. it looks like it is basically done. they agreed to deal with occidental for $76 a share, came in, bute oxy
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there is a different composition sh and muchore ca less stock. in the pink on this chart, we have where chevron was, 32% of of the premium affected price for anadarko. then you have this long period of spin where chevron excepted, and the eventual offer they took from off the dental, which is above a 60% premium. there have only been two oil fields coming in at that. -- two oil deals coming in at that. saying they should not have agreed to deal with chevron, but they got a next extra 22.5%, about $30 per share. that is meaningful. end offace of it, at the this process, anadarko can turn around and say, we got a good price, we are not taking any board suits and are rolling the company into oxy, and
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oxy can get the best synergies from anyone. caroline: so we have been tracking the deal flows coming from this, all important private planes. we understand that occidental's private jet landed in the netherlands. ed: most recently it was in the netherlands. we are 99.9% sure they were there talking to shell. we don't quite know what they were discussing. or have been some theories, potentially middle eastern assets they were talking about divesting, but the team has been upfront about not using the plane to go cut deals. -- they use the buffet deal using the plane, the total deal using the plane. caroline: are they doing this on purpose? ed: if they think people don't know what they are doing with the plan, they are very foolish. they know we are looking at the plane and hedge funds are
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looking at the plane, they probably want us to be speculating about what they are doing with the plane. scarlet: bloomberg's ed hammond, thank you so much. we have the headlines to recap. we see stocks moving. caroline: once again, good mood music coming out of the white house, trump calling the china talks constructive and says they will continue. many believed that there was not a complete breakdown in talks. --are up 5/10 of a percent .5% across-the-board. caroline: we are still -- scarlet: we are still down in the week for 2019, but it says more about the complacency and gains we have seen for most of this year. caroline: from new york this is bloomberg. bloomberg.
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abigail: happy friday to you, matt. it has been quite a week, especially today. we had big losses earlier today. the s&p 500 down 1.6%, but now
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in the green. the last time i saw it, up about when 5%, -- about .5%. there has been lots of volatility. what do you think is next? are up to about 22 .5, abigail, then backed off an incredible turnaround. the news was not that much better. you talked before the break about the latest tweets from trump, but there is really a standoff in the u.s. trying to -- u.s.-china trade negotiations. we are imposing the higher tariffs. the only silver lining and why the market is rallying is at least everyone knows where everybody stands. is there, but so far, the economists have been wrong into the market and economy has done better than expected under the cloud of the trade negotiations and potential deterioration of the talks. abigail: it sounds like you think there could be some downside risks ahead that's
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traders are night -- that's traders are not pricing in. are you suggesting we could see more of a pullback, and to what degree? >> look at the yield curve. we had a little bit of a soft pocket inversion on the three to five-year range, so still, so much money on the sidelines. the vix kind of traded down quite substantially to about 16.5 this afternoon. plaisance he came back pretty quick. maybe that is ominous for next .eek, i don't know but an impressive recovery in the face of bad news today. abigail: it has been an interesting day and an interesting week -- interesting time period. let's turn to your trade, boeing. talk about volatility. are revisiting the trade we talked about a couple of months ago, when boeing was 375, 380, when the news of the
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disasters of the two air crashes came out, and we suggested selling the august 3 50, 400 august 350, 400 strangle. about is now back down to $350, and the premium has come out over the past couple of months, so now the strategy is to take advantage of this winning trade -- already about $13 -- buy back that august 400 call, and roll it down by selling the august $375, trading the massive credit in the boeing position. you for joining us. caroline and scarlet, back to you. scarlet: let's get you a quick check of the latest business flash headlines. gopro, surviving investors -- surprising investors with a better sales forecast. the estimated sales will rise as much as 10% this year.
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gopro has cut prices on popular cameras an attempt to widen its appeal. and a pay package north $9 million. this in his first full year, heading into the overhaul of the university's ailing 39 billion endowment. forard has drawn criticism generating mediocre returns. and college campuses are contending with an ugly problem. people like it because they can posted that post it in their -- post it in their instagram feed. caroline: a glitter kanaan is fun for your feed, but not good for the environment -- a glitter cannon is fun for your feed, but not good for the environment. not good for the environment.
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bloomberg's word news. president trump says today's constructiveere and candid. will continue. talks resumed after presidents raised tariffs on $200 billion in goods. aging promised to retaliate. mr. trump said there is no need to rush a deal. sei did states and china try to resolve the trade dispute, philip hammond is weighing in. he was asked if he is of the opinion trade wars are winnable. >> i don't think that


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