york, 3:00 p.m. in london, and 30 minutes into the friday trading session in the united states. from new york, i'm vonnie quinn. guy: from london, i'm guy johnson. welcome to "bloomberg markets." vonnie: we have fresh housing data to add to this morning's economic data. this is housing data for january. existing home sales slightly beating. nevertheless, down month over month. , aterms of what that means an annual rate, it is 5.4 6 million. housing data aside, the pmi data showed a little weakness, and that sent equities lower than they started out the session. let's take a look at where we stand now. the s&p 500 down 0.9%. right after the pmi data came out, 30 yield long bonds hit a record low. we are seeing that reflected as well in the 10 year, although not at record lows. we are through that resistance 1.48%, now down to 1.46% and

change. gold continuing to rise. guy: curve flattening a big piece of the landscape. euro-dollar spiking on the back of pmi data, i think the weakest number since 2013. i think we don't get ism until the week after next in the united states. euro-dollar with a $1.08 handle. we just had a $1.07 handle earlier in the session. wasgerman ten-year significantly on offer. pmi data out of europe much better than anticipated, so we have seen a turnaround when it comes to the german ten-year. 0.7%s in europe down 0.6%, depending on which market you pick. we are and again negative week in europe for equities. vonnie: coronavirus outbreak also accelerates outside of china. japan seeing outbreaks with no direct links to china, and the

preliminary markets perching -- markets purchasing managers indicating -- in february. deputyinel is with us, cio from state street global advisors. 0.5% thise yield down year alone. what is it telling you that the s&p 500 is very close to a record, and bond yields are at records? should we take this is a positive or negative sign for the u.s. economy? lori: coming into 2020, we thought we would see a bit of improvement in the global economy, but we thought we would see some slowing in the u.s. it is not surprising that investors are grappling with how to be positioned against that muddling through trajectory. when you throw things like the coronavirus into the mix, you're going to have a lot of distortions of the data. we think this is more representative of investors just

trying to find safe haven to write some of this out. vonnie: where else can investors go? do you see yields falling even further? we obviously saw a huge amount of movement in the yen this week , as well. it seems like every safe haven is being gobbled up. lori: we would certainly think the bond markets are overdone here. we are certainly short of duration, savoring credit. there are some other potential safe havens. gold has been a position we held for quite a while because we think is benefit their, and there's a lot of opportunity cost. we are also looking at other defensive sectors. real estate is been a place where you can get reasonably good income, but also have defensive properties. guy: what about cash? do you think we should be increasing our cash portions? lori: at the moment, we are actually not. we had been deploying cash into the equity markets coming into the year. we have been underweight places

like europe and emerging markets, but we have gone to overweight in europe and used cash to do some of that. guy: what do you see from here? you talk about the fact that markets look a little stretched. which is more stretched, the bond market or equity market? lori: our view is that bonds are more overdone then equities. a lot can happen. certainly, the comparisons to sars suggest we are having a bit of a bump in the road, and then coronavirus will dissipate and provide momentum into the economy. but given that we haven't yet seen the peak in new cases, it is hard to know. but if we were to put our money where our mouth is, we are still favoring risk assets, including equities. vonnie: where do you go for equities now that emerging markets look to be may be slightly more risk friendly than they had been? it looks like it was their time, but now with the coronavirus outbreak, does that put the brakes on that thesis? lori: we have remained

overweight u.s. we think the momentum in earnings is better in the u.s., the economic backdrop continues to be supportive, and with a more accommodative fed, it is hard to see the u.s. having a significance tumble here. we have been starting to build positions in europe, where we thought relative valuations were very attractive. we had just started to increase our weight to em, but as you say, that is the epicenter of where there's a lot of stress in the system right now, so we remain cautiously optimistic on emerging markets, and we think the long-term trajectory is quite good, but we would be careful about adding to positions now. vonnie: so you are actually modifying behavior slightly, as our businesses, clearly. we had central bankers really downplay the impact of the coronavirus. philip lane was on the other morning with michael mckee, saying they are not anticipating it to go much beyond q1. presidents including

jim bullard also downplay the importance of the coronavirus. do you believe the fed is hoping it won't have to make a move, and will that pan out? lori: the fed has said repeatedly they think that policy rates are just where they should be given where we are in the cycle. they are slightly accommodative. we hold them to their word, and we don't think there's any pressure for them to act. but they also keep referencing they are keeping an eye on global developments, including coronavirus. i think the good thing, and this is obviously a small silver lining, is that there's no impairment issues here. once people can go back to work in china and once there is mobility in the supply chain again, it is not like the tsunami we had in japan a couple of years ago, where you had physical infrastructure impaired, and it took a little while for that to come back online. the good news is we believe there is still just deferral of the activity and not actually impairment. guy: that is just for the

manufacturing sector. this is a services sector story, though, isn't it? ,ori: that's absolutely true but again, we think china is taking a number of steps to try to mitigate that, whether it be looking at things like tax deferrals or tax reductions, certainly monetary support, potentially even fiscal support. so you are absolutely right, from a service sector standpoint, that is going to be a bit of a clip. but the chinese new year would have been a time when certain activities would have been depressed anyway. guy: people talk about this being a temporary phenomenon. do you think it is going to be a temporary phenomenon, and you think that temporary means that it is basically contained within q1? lori: we haven't yet peaked on the virus cases, so it is a little hard to know for sure, but at this juncture, we would say it is going to be a temporary phenomenon, that we

set ourselves up for a better second half of the year because some of that pent-up demand will likely to be deployed in the second half of the year. assuming we don't see another significant deterioration in the numbers and we follow the normal trajectory, where the virus starts to abate going into the warmer weather season, we would see this as largely temporary. vonnie: thank you for your comments today. at stateel, deputy cio street global advisors. let's check first word news. here's ritika gupta. ritika: the u.s. plans to sign a peace agreement with the taliban a week from tomorrow to end the war in afghanistan. the deal is still contingent on a seven-day long partial cease-fire that begins on me -- that begins at midnight. once it is signed, talks will begin between the taliban and afghanistan government. china has adjusted the number of

cases of coronavirus for the third time this month. that raises more questions about the real ability -- about the reliability of the data. that wellsas learned billion set to pay $1 in investigations into consumer abuses. federal officials will announce that the bank will be fined $3 billion to put in into a scandal that led to the departure of two wells fargo ceos. campaign will take over youtube on election day and a few days before. they bought the coveted ad space atop the world's biggest video website, like a super bowl tv ad. about 3/4 of u.s. adults say they use the site. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in

more than 120 countries. i'm ritika gupta. this is bloomberg. guy: thank you indeed. coming up, we will continue the conversation. joining us next here in london. this is bloomberg. ♪

♪ guy: from london, i'm guy johnson. vonnie: from new york, i'm vonnie quinn. this is "bloomberg markets." let's get to those markets now. abigail doolittle is with us. abigail: we are certainly looking at a risk off tone. the s&p 500 in the u.s. headed to its first down week in three

weeks. the nasdaq down 1.4%. hang seng was down more than 1%. crude oil, brent crude down more than 2%. investors out of risk assets today. renewed fears around the economicus, plus weak data in the u.s. has sent the 30 year yield down to its lowest level. really pretty incredible at 1.9 percent. if we go into the bloomberg and take a look at one force of pain, the u.s. market data in the u.s., take a look at that. a contraction for the services and overall composite come of the lowest level since 2013. investors really not liking the fact that the coronavirus does appear to be affecting the economic data in the u.s. finally, some of the big movers on the day, both to the upside and downside, deere put up a great quarter. those shares are sharply higher, up nearly 10%. procter & gamble is the next

best mover from a points boost. the worst mover for the s&p 500 in sympathy with oil, and we have the shares of microsoft another tech companies down. guy: thank you very much, indeed. stocks lower this friday, partly on fears that the coronavirus is now spreading outside of china and also on that poor economic data we have seen out of the states. joining us to discuss all of this, eric cantor, vice r at millicent co. -- formeris and co. and house republican leader. do you get a sense that deal pressure -- that deals are coming under pressure, that things are have pending -- that things aren't happening?

clearly, fromthat the signals of the markets today, there is concern that not only these meetings are taking place, but that the supply chain interruptions are in front, but we are still seeing a very robust optimism taking place in the dialogue that we are having with our clients. i think certainly in the u.s. with the strength of the economy and the monetary policy still in existence, and then you come here to u.k., and when i post era -- and in a post-brexit where a socialist corbyn government is set aside, that kind of optimism and desire to do strategic deals and transactions is still very much in the offing. guy: let's talk a little bit about what they are saying. you sound pretty positive. i am just wondering if the consensus you are hearing is

that the coronavirus is a temporary phenomenon that is going to blow over, and as a result of which, we are back to business later this year. eric: again, i don't know. no one has a crystal ball here. macrothink from a standpoint, you know that china is going to impact the global economy, and you know that the u.s. economy needs growth in the global economy to continue its growth trajectory overall as well. all of it fits together, but right now, what i'm seeing is the conversations we are having with clients here and the u.k., as well as throughout europe, and certainly in the united states, do not indicate an overriding pessimism connected to the virus. vonnie: larry kudlow is convinced that the china tariffs really add to u.s. exports, so there will be a boom. does that happen?

or is it really a turning inwards? eric: we will have to see. we are in an election year, and i think that there is a lot to have to take place, negotiations to transpire, in order to get to phase two. my hunch is there's going to be a lot of talk and optimism about an actual deal prior to the election. i am not sure it does happen, but right now, with things being think that is enough that the trade risk vis-a-vis china is definable at this point, so we will have to continue to watch it. on the trade issue itself, you know that there's a lot of discussion, a lot of work out of the administration that we want to be able to deal with europe as well. notion this ever present of automobile and supply chain tariffs, and creating an even playing field. but even more, if you want to take an optimistic view, i think the prospects of the u.s./u.k.

trade agreement are very good. i think the administration wants to see that happen prior to the election, and i think that prime minister johnson would like to see or would have a u.s. agreement under his belt in order to deal with the europeans. it certainly would give him more leverage. vonnie: you can tell us more about what you are doing in london in a moment, but first, you brought up the u.s. election. i am curious to your thoughts on who takes over the lead spot that is not the bernie sanders wing of the party. from the election standpoint, i do think this is president trump's election to lose. the economy, as you know, is doing very well. people at home are feeling much more optimistic about their future. the democratic party seems very fractured to me.

i look at it, and it is reminiscent of what happened in our party four years ago, when you had this huge primary field. the difference being the democrats and how they are proceeding with their primary election, they are proportionally allocating their delegates towards their convention, whereas in the republican party, donald trump was easily able to garner the majority of delegate votes because we had mostly winner take all system when the states had their primaries. president trump, then candidate trump, had the plurality of the support, but took all of those delegate votes. i think they will be fractured for quite a while, which will be an advantage to the president. guy: you talked about jeremy corbyn. he is still the leader of the labour party, but not for much longer. one about senator sanders? if he was the nominee, do you think the market would become a little bit more relaxed -- less

relaxed? people seem to be assuming it is going to be ok, that he is not into -- not going to end up in president. if he were, would he be curtailed in his ability to change the comic system because of the senate? eric: first of all, from a macro standpoint, if bernie begins to look very serious to be the democratic nominee, which, after nevada, south carolina, and super tuesday, i think he likely will, people are going to take note and get more serious. but what we are telling clients in terms of the kind of deals they are looking at, number one, i feel that what we know is they are much more strategic in nature than to have to be influenced one way or another right now. but what we are telling them is if you have a regulatory risk, meaning if you are an industry that is going to face, god forbid, a president sanders, he will have the ability to promulgate new regulations that could be very hostile to certain industries.

hand, there are businesses and sectors worried about statutory changes, what we are telling clients is there is probably very little possibility of that really happening in any big way because it is so difficult to see washington coming to consensus in a divided government. my sense is we are still going to have a divided government in washington. you are not going to have a unified government in charge. guy: where would the opportunities be? we could come up with a big green deal. there would be infrastructure spending, a lot of money coming out of central government. the republican party seems pretty comfortable with the deficits right now as well. wouldn't there just be a lot of spending? eric: remember, though, the power of the purse belongs to the congress, and if you have a democrat in the white house, i don't believe the democrats will control all of congress. so let's say that the republicans still maintain the senate. there would be an inability for bernie sanders to do his new

deal because the republicans would be there to object to this leftward lurch he is about, but he will, to my point on regulations, have the power of the pen. he will be able to threaten the health care industry, financial services, oil and gas, tech through executive order. obviously, there is always going to be in our system a challenge to his exercise of executive authority, but then the courts will have to decide, just as they have been playing that role during the obama administration and the trump administration. vonnie: briefly, obviously there's a bit of a focus on britain right now. that is most likely why you are there. tell us what you are pitching to clients in britain, and whether more m&a activity, more restructuring, more recapitalizations will happen outside of the u.s. and europe in the next 12 months. are: i think what we

telling clients is now is a great time because there is andpect for further ties enhancing the relationship between the u.s. and the united kingdom, but what we can see is now with this sort of burden lifted, that there is not going to be a jeremy corbyn socialist government in place, what we are seeing is a lot more desire for board rooms, management, senior management, and clients to say we can go invest in capex, entertain m&a ideas because we are actually in an optimistic mode now, having shed the corbyn threat. guy: nice to see you. thanks for stopping by to see us at bloomberg, eric cantor. this is bloomberg. ♪

vonnie: it is time now for etf friday. morgan stanley is acquiring e*trade in a deal worth $13 billion.

here to discuss his bloomberg intelligence etf analyst james seyffart. the main takeaway, any etf's that would benefit from this? trend this consolidation is being driven a lot from high cost to low-cost. firms are being forced to either be competitive on scale were differed g8 services. there's a lot of vertical integration going on, so they are expanding into areas they don't usually go into and competing across multiple different areas. vanguard is adding advisory services, goldman going into online banking and retail services, just like morgan is doing here. all of those things are playing out. ofnie: james seyffart bloomberg intelligence, etf friday.

♪ vonnie: live from new york, i'm vonnie quinn. guy: from london, i'm guy johnson. this is "bloomberg markets."

let's check in with the bloomberg first word news. tomorrow,week from the u.s. and the taliban will sign an agreement will in -- agreement to end the fighting in afghanistan. the deal will still hinge on a weeklong reduction in violence set to begin at midnight. iranians voting for a new parliament today. more than 7000 potential candidates were disqualified ahead of the election, including 90 sitting members who wanted to run for reelection. the election comes at a time of economic uncertainty in iran. u.s. sanctions have strangled the nation's ability to sell its oil abroad, pushing its economy into recession. prime minister boris johnson sailed through his new government's first pager economic health check as he prepares to lead the nascent -- the nation through a potentially bumpy exit transition. several figures this week confirm signs of a so-called

boris bounce. a pickup in growth following the conservative election when. the treasury is also on track to borrow less than forecast. germany's economy is getting hit by the coronavirus. export orders have plunged and manufacturers worry about the impact of the disease on their supply chains. a new survey also shows expectations for output over the next year have fallen. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. vonnie: thank you. staying with the economic fallout from the coronavirus outbreak, china's auto industry is feeling the impact. subsidiesmay extend for ev purchases beyond 2020 in an effort to revive sales. we are joined on the phone by tom orlik, chief economist of bloomberg economics. just another in the list of things that presumably, chinese officials are considering.

tom: that's right. i think the signals coming out of china suggest the balance of concerns remains on containing the health risks from the virus and bringing the outbreak under control, but we are seeing more indications from china's policymakers that they also want to guard against a big drop in growth. saying thattburo they needed to ensure that demand at home and abroad remained robust. that is the backdrop of some early data. business surveys, korean export numbers showing alarming drop in china's growth in february. guy: i've just seen a headline coming up from the world health organization, which is now concerned about the virus increase they are seeing in the chain dong -- in the shandong

region. how problematic would that be for many factoring? -- for manufacturing? in inland province is china, and it is not really central to the operation of the economy. most of china's major industrial centers, major export centers, or on the coast. that is where shandong would fit in. shandong is one of china's biggest provinces, in terms of output. it is engaged fully with the global economy because of its coastal location. , think this is breaking news as you mentioned, and we will have to dig into the details, but certainly, if we were seeing outbreaks in china's coastal , etc., thathandong would raise concerns not just

about the impact on china, but also impact global risks. vonnie: it seems there are two states of mind here. chinese factory owners say their employees are all going to be back to work by the end of this month. u.s. central bankers say it is really not that much to worry about. we just had jim bullard saying similar things, and philip lane from the ecb. then there is the reality of it, where people seem to not know what is going on. they are not going to back to work. there's more outbreaks every day, including in japan, where there isn't even a direct link to china from those outbreaks. tom: right. i think we are going to have a really critical moment in the next week. since thetwo weeks end of the chinese new year holiday. china imposed a two week quarantine on the hundreds of millions of people who traveled for the chinese new year

holiday. so next week is the week where they are going to be going back to work. i think at that point, there's two diverging paths for china. there's a positive path where people get back to work in factories start operating, and concern starts to come down. there's also a risk that when people get back to work, we get a new stage in terms of contagion, and then some of those risks which the ecb and the fed have so far been playing down could start to materialize. guy: we are going to leave it there. thanks very much, tom orlik of bloomberg economics. iranians are voting today for a new parliament, expected to become more hard-line and conservative. we are getting headlines out of the who briefing in geneva. the who headline relating to iran, saying that it is concerned about the increase of virus cases in iran.

diwali --s gold armor --omberg's gold armor diwali otevallig's golnar m joins us. >> this is basically the last thing officials needed. from some reports from our own reporters on the ground, we are concernhearing the because we have the first deaths announced last week, two more deaths this morning. they are putting a further dampener on peoples appetite to come out and vote. vonnie: is this election going to change anything in iran? golnar: in looking at other parts of the executive, is noticiary, parliament

as powerful as many of those, to be honest. but it is a very vibrant debating chamber. at the end of the day, it is about an election that gives people a chance, at least on the surface, to vote. the issue with this election that is an issue for himself raised is that many people -- thathot sun rouhani -- hassan rouhani himself raised is -- that hasople been the main complaint with this photo part. guy: do you think it will change the way iran deals with the outside world? many people were surprised that the killing of general soleimani didn't elicit a bigger response. i wonder what a more hard-line or conservative parliament, whether the nature of the relationship changes.

golnar: it is a very interesting question, and it is very complicated. the very targeted killing of qasem soleimani and the maximum pressure strategy the u.s. has embarked on a general has very much doubt when hardliners in -- has very much galvanized hardliners in iran. because of that, the hardliners are now more empowered than they normally would be. at the same time, that would suggest that on the surface, we will have a much more belligerent edge on the country. we will have numbers of parliament who work, back in 2015, very opposed to the nuclear deal, who are some of the most ardent voices against any kind of negotiation with the u.s. with those guys back in parliament, of course, we are going to reenter that kind of mood of having a country generally controlled by find more -- by far more orthodox

right-wing voices. anthe same time, there's argument to say with all branches under one political banner, it is much easier to make a unified decision about engagement with the u.s., which is something that could happen further down the line in back channels. it is quite a complicated situation when you look beneath the surface. guy: we are going to leave it there. nice to see you here. otevallig's golnar m joining us on elections in iran and the coronavirus cases. the who saying it is very worried. the briefing is currently underway on the coronavirus. a couple of things worth bringing about. the first is what is happening with the shandong region, which the who is now highlighting. that is a more economically sensitive region in terms of china's relationship with the wider world. if you want to watch what is happening in geneva, you can do so. live go on your bloomberg

on yourlive bloomberg terminal will take you to it. his bloomberg. ♪ -- this is bloomberg. ♪ >> although it is another opportunity to contain the outbreak, we still have a chance to contain it. but while doing it, we have to repair

♪ guy: from london, i'm guy johnson. from london, i'm guy johnson. vonnie: from new york, i'm vonnie quinn. this is "bloomberg markets." it is time for our stocks of the hour. here's abigail doolittle. abigail: today we have two stocks, featuring sprint and t-mobile. sprint shares are up sharply after they revise the terms of their long-awaited merger with t-mobile. as for those adjustments,

t-mobile owners will get about 11 shares of sprint for every share they own, up from 9.75. the combined company will have about 80 million subscribers to put them on par with at&t, a little less than previously --ught, and has sprint thought, as sprint is losing its customer base recently. it has been a mainly uphill ride for t-mobile, but sprint has been down for much of the last year on regulatory hurdles. once the deal was approved, however, sprint has made a leap up and arising by about 55% since the deal was first announced. t-mobile is also up over that time, which tells you investors think this merger makes sense for both parties. finally, who will be the big owners of the combined company? that would be deutsche telekom at 43%, various holders at 33%, and softbank at about 24%, a

nice feather in that firm's cap after some recent struggles. vonnie: thank you for that. street --ising the deere surprising the street. the u.s. farmer in a better position than the street had anticipated, particularly this quarter. why is that the case? let's bring in bloomberg opinion's brooke sutherland. how is the market stabilizing? brooke: i think what deere is seeing is optimism on the u.s.-china trade deal, and some of these agricultural purchases will start to bring some of these farmers to the market. they have been sitting on the sidelines because the demand hasn't been there, there is so much uncertainty. how do you justify buying these extensive pieces of equipment? one caveat is that deere did not mention the coronavirus, still calling for flat overall equipment sales in asia. the degree to which that shifts will be very interesting to watch. very important on the call, they talked about how they are

concerned about their supply chain, and they are going to spend about $40 million to expedite so that they can have all of the parts they need in their various international operations. said thatresident farmers should go out and buy bigger tractors, and bb that is what they are now doing. in terms of the trade deal, there has been some concern that farmers will struggle to meet the demand laid down in that trade deal. is there a sense that come from deere and elsewhere in the sector, that the u.s. sector is capable of delivering? optimismeere said among farmers is still subdued. there are some of the questions as to whether those agricultural purchases will actually come from china, and whether the u.s. can meet demand. deere would tell you that they can. they have been pushing this precision ag offering meant to make the equipment much more efficient and capable of processing a variety of different products.

that is what their advantages. that is what some analysts think will give them an edge of our competitors. it will be interesting to see how that plays out. but there are so many variables here, which may cautiously optimistic on deere, but still a lot of questions over there longer-term outlook. vonnie: increasing competition from south america and the black sea. we also have a survey showing more than half of u.s. farmers plan to not spend on equipping this year, and we have excess inventory. that seems like a lot of challenges. brooke: it does. you have seen us across the manufacturing sector, where we see signs of stabilization, but what exactly does that mean? there was hope for a sharp recovery on the back of this deal, but there's not necessarily the element for that to happen. if you think about this downturn, it is relatively mild compared to some of the other recessions we have seen, specifically the oil price downturn in 2015 and 2016. i just don't know where the order growth is going to necessarily come from, whether

agricultural equipment, some of the other factory machinery to justify this optimism on a rebound. what you are seeing today with the stock reaction to deere's results is that the company is being relatively conservative and realistic, but investors are running with it, and they have been running with it with all of these companies. make a point does that potential he negative event? calhounre does say catch a break? not until theyy get that 77 max flying again. they are stuck with that plane. there is just a steady stream of bad news, the latest being that they found foreign debris in the engines of some of the stored 737 max. rags, tools, goggles left behind by various workers. those planes are not flying, but that is sort of a sign of potentially a bigger problem at

boeing given that there was a similar issue with their tanker for the military, and reports of potentially similar problems for the 787 dreamliner. at all comes back to quality control, being disciplined and executing. at least we are finding out about it now and not several months from now, when they are trying to be transparent, but being transparent is one thing. working through these issues is another. vonnie: brooke sutherland, thank you as always. guy. note, "ev'samming on the brink of change," the future of electric vehicles and he passed to mass adoption, plus the challenges facing consumers and the automakers. it is a special program tonight at 9:00 p.m. new york time. this is bloomberg. ♪

♪ vonnie: live from new york, i'm vonnie quinn. guy: from london, i'm guy johnson. this is "bloomberg markets." palladium is one of the hottest precious metals right now, up this year 38%, but coronavirus pressure starting to ripple through the auto sector could create a stall in this rally. renita young has more details. renita: palladium is used to curb toxic emissions from gas fueled engines. stock prices recently had an all-time high on increased demand and tight supplies come

about what goes up must come down. a slowdown in china's auto industry could tap the brakes for palladium. china is the world's largest auto market, and its height massive sales slump of 22% in january. meanwhile, auto factories across china have halted some operations due to auto parts shortages. auto sales in china are expected to decline further. global mining company anglo american ceo told his investors that palladium prices have room to retreat in the short term. atrecious metals analyst standard chartered bank said it could create a short-term bottleneck and a temporary dip in demand for palladium. the auto industry accounts for more than 80% of palladium demand, so the key question for precious metals investors may be just how deeply the coronavirus will impact the auto industry, and therefore palladium prices longer-term. guy: thank you very much,

indeed. let's get to what is happening in the wider markets. let's get to the vice president of callus investment at the cme. joe, the u.s. 30 year long bond just hit a record low yield. i am curious to what people at the cme are suggesting what could happen next. do we get lower yields from here? >> i think we are going to have to wait and see. right now, we are not anticipating it. we priced in this kind of move potentially with the coronavirus. but again, i don't think we are going to see a huge pop above 1.65% as far as price on the 30 year at this point. i still think there's challenges ahead for that, and we are going to have to see this demand delay versus demand destruction case play out as we start to see mixed pmi's globally. guy: just talking about what is happening in the precious metals market.

the market is still crazy for gold. are you a buyer? ae: i'm neither a buyer nor seller at this junction. i think it is a little frothy at this level. now the current situation, talking about potentially inflation down the road, not surprised that gold has been hitting these highs. guy: great to see you. have a great weekend. joining us from the cme. vonnie: it is time for your latest bloomberg business flash. tesla has got the legal go-ahead to resume clearing of forests in germany. a berlin court has overturned an injunction that blocked the electric car maker from building a factory there. the ruling avoids the threat of a lengthy delay for the project. private equity giant kkr is making a bid for telecom italia's landline unit. they may by as much as 45% of the unit.

it would value the business at up to 8 billion dollars, and could lead telecom italia to go ahead with a long plane spin off. you were just looking at warren buffett. he's releasing his annual letter tomorrow. investors, as usual, we waited very closely. which berkshire hathaway rose at a slower pace than the s&p 500, the stock's worst performance in a decade. more forwe will hear the weekend. that is your bloomberg business flash. deere is the highest performer right now in the s&p 500, up 7.6%. the best performance, followed by nickel west. the s&p 500 is down a full 1% as we see long bond yields at record lows. the 10 year just falling off a cliff today. the other indices are following the s&p 500 lower.

right now, the u.s. 10 year , and we have.4561% gold futures up. the vix future is above 17. a very risk off day. guy: absolutely. in europe, we are just off session lows when it comes to the equity market. equity markets on offer, bond markets certainly bid. you see a squeeze into euro-dollar that is certainly a factor. the pmi data out of the united states certainly a factor behind that squeeze. the pmi data out of the euro zone, europe more broadly, reasonably positive today. not that positive, but not as bad as feared. european equities, though, softer. this is bloomberg. ♪

guy: fears grow that coronavirus is now spreading around the world. today, we are hearing dime -- we are hearing dime will -- we are hearing from daimler, coke, and

others. the u.s. composite pmi data comes in at its lowest level since 2013. plus, the storm clouds gathering over the shipping sector as a result of the coronavirus. we will have some analysis coming up from jeffrey's a little later -- from jeffe ries a little later. we are counting you down to the european close on "bloomberg markets." ♪ vonnie: it is friday. the coronavirus is spreading, now in countries with no direct link to china. a lot of market jitters out there. companies are mentioning it in europe, and we are seeing the s&p 500 down 1%. we had the market pmi data from