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tv   Bloomberg Markets  Bloomberg  November 3, 2015 3:00pm-4:01pm EST

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petty: good afternoon. here is what we are watching at this hour. stocks are extending their raptly as the s&p hits the highest level since china's surprise evaluation of the one -- the yen back in august. the economy is improving as consumers drive purchases, is it a sign the fed will drive rates higher? from streaming to digital to sports, it is a challenging time for traditional broadcast companies. an hour away from the closing bell this tuesday. i want to head to the markets. julie hyman has the latest and it is kind of a field good -- feel good right now. >> most definitely, we are seeing a rally today, getting closer to the records for the
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major averages. pre-much at the highs for the session, the dow has been leading all day but the s&p and the nasdaq are holding their own. we have got a couple of different helpings. investors are looking ahead to commentary from a number of people the federal reserve. we got the jobs report friday, a commodity recovery, a lot of fuel for the rally. 500, it is less than 1% away from the record close. this is a six-month chart and you measure the margin between the record close back on july 20 and today's trading. the record close. take a look at the imap here. we're seeing energy continue to
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leak gains. energy has been the best laterming first since august. someials helping to lead of the gains. technology is the largest group, all of that contributing to the gains we are seeing. >> he forget earnings. however earnings been so far? s&phis has been for the 500. this is the growth in that. 500, we haves&p seen sales declined by 20%. both of the numbers are better than analysts had anticipated at the beginning of the season. and earnings per share decline of 6.9%. it is not unusual for companies to come out better than anticipated. it should happen every quarter.
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idea numbers do get an during these earnings seasons. stocks are frequently being reacted to in forecast, not just with reporting on the quarter. betty: thank you. withr-- with ramy. ramy: the russian plane in egypt slowed suddenly according to a flight tracking website, flightradar 24. final 26et in the seconds print the new data is consistent with reports from egyptian and russian officials .hat say the plane is a car moscow does not consider it a matter of sensible that the sharp aside remain in power.
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previously balked at the suggestion of the syrian president should be removed. state fightersic in syria. that is at request. the cheating scandal indicates card.itional putting the economic risk from the finding at $2.2 billion. under the u.s. clean air act, volkswagen may be available as high as $18 billion, facing additional costs filed in the u.s. as well as europe. the u.s. federal government is adding automatic braking to the five star safety system. this is designed to help consumers identify the most important safety technology to look for in a car. with 2018 models. it is election day across america. polls are open across texas where voters are considering seven proposed amendments to the
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state constitution and marijuana is on the ballot in ohio. must decide whether to legalize pot and if so, who gets to grow it. this comes as colorado decides what to do over there. the firstlook at alert news. you can find the latest on bloomberg.com. betty, back to you. betty: thank you. to speak publicly tomorrow, they could give more clues on a rate hike in december. janet yellen is first up, testifying on capitol hill in the morning. a press briefing being held in the afternoon. in the evening to round out the night. i want to bring in the chief investment officer of trust who joins us from boston. fedsay the markets want the to be one and done. that is what the markets are looking for?
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collects i think so. we have had a cloud hanging over our head as far as fed policy. as they had some verbiage that time,long with that for a i think the market responded to it very favorably. betty: what number or set of economic numbers do you think though market is relying on? is it a jobs report or something else? >> a two minutes are inflation and stability as far as the economy is concerned. we know that jobs are good. even though we have come down in the last quarter as far as month over month creation of jobs, it is still healthy. hopefully, this friday, it will be the 185 category, which would be good for the market place in general. inflation feels subdued and in control. moveed does not have to from an inflation standpoint.
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we are getting close to the resistance as far as unemployment and that sometimes fit triggers the fed to move rates. overall, it is not compelling that they move rates based on the market right now. you see the s&p by 2200 at the end of this year? >> we were looking good there through may and june and july when we read 2130. then the third quarter happened. the third quarter took a little bit out of that. but the recovery we have seen today in the last month or so has been astonishing. a five 44%ill take gain for the levels to get there. we could do it over two months. we could stick to our guns and be optimistic it could close by the end of the year in the s&p 500. betty: what could drive us there given we are expecting the fed to raise rates?
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>> i think it will be a shot in the arm for the market in that the fed will basically say the economy is strong enough to withstand increased interest rates. like i said, if they do the announcement, they say they will the next move. that would be favorable for the stock market as well. betty: what about those ringing it ishands who say outstanding a far we have come from the bottom back last month. are getting stretched again, near record levels again. >> right. you said it earlier and i thought it was correct, the statement you made about earnings. earnings are coming in ok. if you look at the energy sector, they are strong. right now through the morning when i looked at it, the energy sector in a year-over-year basis, we are up for earnings in
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the quarter. that is not that we are on track for energy to be on about seven or 8% for 2015. those are good numbers and as i stock prices generally follow earnings growth over time. speaking away from stock prices, but bond prices, bill gross came out with the investment outlook. he basically says the fed should do the switch. so they should stop buying long-term notes and be selling long-term treasuries and buying short-term treasuries to get the yield curve to not flatten. is that a good idea? >> one of the key leading indicators of the economy is the yield curve. when they look at recessionary traits in the marketplace that cause a recession, they generally cause recessions.
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get a more positive shape than the yield curve, that means you have inflation expectations growing down the road and in the near term, you have probably got a more stable to growing economy. i am concerned because we are starting from low rates and i told be a little hesitant see the fed push us into negative short-term interest rates, which they could do based on the buying power. betty: thank you so much, the chief investment officer. much more is ahead in the next 20 minutes of bloomberg markets. the media is making headlines today. cbs reporting after the bell and networkng a brand-new called vice land. tag is almost $6 billion. how will this change the gaming world when it comes to games on
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your mobile phone? thise seeing job cuts earnings season p or what does it mean for the health of the global banking system? we will dig into that in a moment. ♪]
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betty: good afternoon welcome back. i am betty liu. here is a look at some of the biggest business stories in the news right now. vice media is launching a new tv channel with amd network. it will focus on gay culture and marijuana industries, the music industry. the channel will debut earlier next year.
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vice will supply the programming in overseas technical operations. investigated two hundred million dollars in vice land page on stewart and hp are getting together. the cable network agreed to an exclusive four-year -- it includes short form digital content. stewart was the host on comedy central for 16 years of the daily show. morean know is get business news at bloomberg.com. for more on the media, isbs scheduled for third corning -- third-quarter earnings. the company is expected to earn 80 cents per share. the bloomberg intelligence analyst joins us now from princeton with a preview of cbs.
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are so many things going on right now in the digital world. cbs, what will be the main questions for investors? thats is a media company is very heavily exposed to advertising. is the biggest question on everyone's mind, how are the ad growth trends and what does that mean for the tv advertising market in general. we see in niemiec tv advertisements through the first half of the year. willositive commentary restore investor confidence. they have other companies, discovery reported fairly strong was else. we will wait and see what cbs has to say as far as advertisement results are concerned. >> right. discovery is not enough to give us a sense overall of the advertising market. there was a huge media selloff
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in the summer, prompted somewhat by disney and comments from bob eisner. what the cbs going -- what is cbs going to say that these networks are going to keep up with a digital age? quite exactly. investor panic, most executives came out and said that was an over reaction. it was certainly overdone. the trepidations surrounding court cutting and whether the health of the tv ad bundle is being imperiled and what we have seen as far as results are concerned, is that the cable subscriber numbers are pretty strong. that has been a fairly encouraging sign. from the skinny bundle,
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it might have eased a little bit. cbs has actually hedged itself pretty well. toy have low looks leisure the tv bundle and they have been very proactive and come out with multiple streaming products. launched an oh tv offerings for short time. they seem to be in good shape. speak to me about disney and the deal with vice. was this a need to do deal because they needed to show they are in fact touching millennials ? >> absolutely. something we have been tracking is broadcast tv. was -- saw last season with broadcast was a 10% decline in viewership. that decline becomes more
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.ronounced this deal is targeting the younger folks. we saw them do a similar deal last year when they acquired a youtube channel focused toward the younger audiences come toward millennial's, and bice is going after millennial's, those eyeballs. thank you so much. really appreciate you joining us. eldeste is -- he is the son of warren buffett and following in his father's's footsteps when it comes to philanthropy. my interview with howard buffett comes out today. he has a foundation that has already given away $775 million in africalobal hunger and we spoke about the differences between charity and philanthropy. >> we try to avoid philanthropy
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if we can. if you look at what we are doing building threee hydroelectric plants. that is an investment and the people who benefit are the who will continue to receive income, people benefit from it, obviously from their homes, and then dennis -- businesses will be built. an investment and charity kind of comes into play when there is not an opportunity to make an investment, when you feel there is something you should do and you are compelled to do it. >> he tells me he only asks for his father's investment advice if he is not sure about something and only if he is prepared to take the advice. crush.head, candy the company is being taught by blizzard at a 20% discount.
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what does this say about the mobile gaming business next? ♪
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betty: welcome back to a match made in gaming heaven. activision, the maker of call of duty, agreed to buy the company behind candy crush for five million dollars. the bill gates up activist portfolio -- they say it is high time the company got into mobile. >> we think now is the right time to enter mobile gaming in a meaningful way. players can enjoy anytime, anywhere. question running us from l.a. is the bloomberg news reporter chris. activision have to buy
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their way into mobile gaming? they couldn't do it themselves? >> they have been trying. you know there are only a few megahits and there is no question that candy crush is a megahit. gaming,player in mobile a huge amount of players already gathered. betty: it is huge. give us a sense how big? >> almost half a billion monthly in the facebook and youtube category. of course, they are keeping them paying for a product they could sample for free. quite what is interesting is the
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stock is actually up on this. what do you make of that? >> there is a little back-and-forth. people tried to figure out what is going on. saying this deal does make sense. a lot of candy soon after halloween. it puts the piece of the overall puzzle. activision is really big and consul and computer games and now they have a big position in mobile games. inty: they brought blizzard 2008 and had some problems integrating the company. learned fromthey the purchase of blizzard and how they will apply that to king digital. >> that deal gave them a huge presence in the computer games
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and the online world. over thegoing steadily past seven or eight years. them -- flow allowed ,here it was world of warcraft he sees a parallel to that in mobile, they took a business that was mature and they built upon it. i think that is what he will try to do here. >> this leaves people questioning what about other mobile games and other gaming companies? zynga comes to mind and how popular farmville was several years ago. you spoke with mark and talked to him a little bit about the deal. tell me what he said? >> the other developers will report earnings today. he says he does not need to do a
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deal because he feels his portfolio gains are enough. the ceo of king told me yesterday that this is the next step. we will see what can happen in the next 10 years. it is a good example where a game is really hot and then no one is talking about it anymore here at what you do next? chris, thank you. still ahead, look around the world are there are trouble spots everywhere from the global banking industry. a look at where the financial sector is headed. ♪ the only way to get better is to challenge yourself,
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and that's what we're doing at xfinity. we are challenging ourselves to improve every aspect of your experience. and this includes our commitment to being on time. every time. that's why if we're ever late for an appointment, we'll credit your account $20.
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it's our promise to you. we're doing everything we can to give you the best experience possible. because we should fit into your life. not the other way around. betty: live, you are watching bloomberg markets. i am that a loop peerless check the headlines this afternoon. ramy has more from the news
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desk. that downed russian passenger plane over the weekend. out are hoping to figure what caused it to crash. american satellite systems detected heat around the plane before it broke apart, which could indicate an engine exploded or a bomb went off. 24 people on board were killed. years in meeting 66 the making. the first such gathering. the meeting will be aimed at .trengthening across the taiwan no joint declaration is expected. in the u.s., paul ryan says republicans need to offer the nation a new and bold agenda. he laid out some of his agenda at the first press briefing today which followed a closed meeting with gop lawmakers and
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said the u.s. is heading in the wrong direction. in a generational, defining moment and we do not believe the country is heading in the wrong direction. we do not think it is spirit we think the president has been leading it in the lot -- in the wrong direction. we think they will continue to lead it in the wrong direction and we feel we have an obligation to the citizens of a country to show them how they can do things differently to tackle the problems before they tackle us and to get things fixed. >> he also says the house will be operating in a more inclusive and open fashion. attack the high price of drug prescriptions in an upcoming forum. the cost of specialty medications represent 1% of medication but they made it to 32% last year. evented to attend the november 22. in kansas city, their party in
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1985. live pictures right here of a rally in advance of the parade. celebrating the team's first world series title in her years and only the second in their history. about 200,000 people are packing the parade route in 2010. the best-of-seven series, four games, to-one. that is a look at the first alert news right now. you can find the latest on bloomberg.com. where is mark crumpton? he is still recovering? cannot liking the pictures we just saw. thank you. the markets closed in less than 30 minutes p julie hyman has a check of some of the biggest earnings losers they are missing on the pig rally. julie: this is what we see season.arnings some of the worst performing stocks in the s&p 500 includes
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business and technology information. down the most in 13 years after matchedany's earnings estimates but sales missed estimates. it's all revenue fall year-over-year partially due to currency. shares take a big hit. then there is bradstreet, that stock is also seeing a big , financial information is down more than 6%. the company's earnings is topping estimates. revenue below what analysts had been anticipating. investors need to get used to more deferred revenue, that it has more ongoing contracts with clients where does not book the revenue right away. some of it is perhaps due to that transition. we have been watching aggregate material stocks, construction materials effectively. bigger decline
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here. sales missing estimates. it says in particular its nonresidential construction business is suffering, about 30% of sales, substantial. it says it should improve slightly and 2016 and earnings there beating estimate -- estimates and revenues missing. the company saying gradual recovery for demand continuing across most, faring better today. betty: major news out of the banking industry. bad loans,000 jobs, and emerging markets hurt earnings. credit suisse announced a major job cuts. while profits rose to just over $2 billion.
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wealth management declined. the bank also ship -- shook up management positions and as itck profit margins deals with a slumping european economy. earlier, sergio sat down in zurich. quarter. a challenging in addition, think about the seasonality in the summer. you go from an environment in which the fed was turning out to do exactly the opposite. a big change in the sentiment and what happened in china and the political front. i'm glad that not only did we manage the risk of the bank effectively but we also managed in the good times with clients their risk and that is the biggest success for the quarter. >> pronounced the leveraging in asia. should we be concerned for 2016? >> not really.
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the journey for growth is still in tact. it is more volatile for everything that happened but i we will continue to have a substantial part of the growth coming from asia. a more challenging environment going forward, but we are well prepared. revampedment banks, and restructured. where did the return and equity come from and is it sustainable? >> it is very sustainable. you look at the last 12 quarters. had a minimum of 15%, always about 20%. in good and bad market conditions, we are very focused with our resources to serve clients and become very effective and successful as a
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business model. about targets. today, the market will say you are delaying your return on by 2018.rget of 15% what is the response? delay.echnically a >> the response would be to say and feelkely to beat pretty confident to see a target of 10%. we will get closer to 15% this year. i think we are not delaying it. we are adjusting our return on targets. we want to stay in the banking industry. they have had the credit grade .ut by s&p
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less likely to help them in a crisis that we are learning goldman sachs is facing a justice department investigation security.ions the rationale behind the warnings here. ofthey are doing what a lot credit rating has done over the last few years. ofe out the assumption government support for the ratings. there has been, after the crisis, they started to factor in a likelihood that they would get bailed out again. a lot have started to remove the s&p, this is after the new rules designed toich are stop a government bailout from happening.
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the underlying credit of the banks has gotten better as they improved capital ratios. the assumption of support is coming out. betty: you heard hillary clinton last week on the colbert show saying, let them fail. >> right. there is not a lot of political will to step in and save the banks. betty: not really that big of a deal? >> think the credit markets saw this coming and it has been going on for a number of years. you have the s&p saying some of the underlying operating subsidiaries might get upgraded, which shows a little more optimism about the underlying business apart from the political issue of ale outs. betty: what about goldman and the new legal issue? >> goldman does not dispose of a lot of details around this thing. a list of activities currently
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being reviewed by government agencies or regulators. this quarter, they added a few words in there, auctions, authoring's, and certain types of trading. we think this relates to, bloomberg has reported by the justice department looking to collisions in the treasury market. there had been civil suits on the issue where investments said the dealers had colluded to increase prices of treasury auctions. we reported about some agencies looking into this. believe lead you to this is not just a goldman issue but an industrywide issue. it is something we will have to wait and see on. you so much, michael moore, who covers the banking here at bloomberg news. much more is ahead on bloomberg markets. october was a great month for auto industries. ust do robust car sales tell
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about the overall health of economies. saidrow, chair yellen, it dudley, and vice chairman fisher, what are investors waiting to hear? plus, erik schatzker sitting down with the ceo to talk about all of the mergers in pharmaceuticals and the latest trend in the industry. ♪
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good afternoon. time for a look at the biggest business stories in the news right now. of $600 million in alternative assets to reduce exposure to private equity funds according to people with knowledge of the matter.
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held by alio is subsidiary that manages employee post retirement plans. working with an advisor and a deal may be completed by the end of the year. he u.s. government is finding the corporation $79. the traffic safety and ministration will be able to add up to $130 million in penalty if it does not obey the term of a five-day yield. muchcould explode with too force, spewing shrapnel into passengers. beut 23 million airbags will -- have been recalled. volkswagen said in the wake of the company's diesel scandal, an additional 800,000 cars have irregular emissions outputs. 2.2 billion dollars under the u.s. cleaner act. -- clean air act. it will be fined as high as $13 billion.
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losses filed in the u.s. and europe. can always get more business news at bloomberg.com. staying with autos, a strong month for u.s. auto sales. toeral motors saw sales up odette postedally percent.ing 13 joining me now, the cohost of what did you miss. if we are eating out but buying our cars? i said just think it is hard to look at the current numbers and feel to negative about the economy. cars are expensive and you will not go out to buy a car if
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you're feeling concerned. various surveys are out there. people think this was the best month since the crisis. i think when you look at the concerns of the u.s. economy, they may be a little overblown, hopefully. betty: wasn't this long overdue? is onerage age of the car the road. >> cars were depressed on economic collapse. i think things like car sales and housing are part of what is u.s. economy and what has allowed the recovery to last so long. housing, in this case, it did not. one reason why the
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recovery has been elongated. we will get the jobs report this friday. trend, if you look at the last few months, you saw some deterioration. i do not think it is useful. that would probably be reaching too much. the general trend, they moved up and you can go back a long time, more than a couple of decades. , it isdo not have a job a good thing. >> great to see you and thank you so much, joe. coverage, full speaking about cars, of tesla's's. investors will look closely at how the new model is going and if it is rising fast enough to
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deliver tesla's target of 50,000 automobiles by the end of the year. heading closee're to trade as we had to break. how the trading is going at the close. ♪
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betty: welcome back. i am betty liu and stocks are cruising -- closing to julie hyman has your market check and we are seeing a big rally and it is losing a little bit. quite losing a little bit of steam but it was like we are close to record closes for the major averages. the s&p 500, still about 1% or less from the closing record in july. the dow and nasdaq cap and gaining. the dow has been a leader on the day. we have been watching the nasdaq closeday, set to
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potentially at a record. going back to 1999, you see the trajectory of the nasdaq 100. the composite is not quite there but the 100 could close at a record today and it looks like it will make it there. i have been looking at the price to earnings ratio of the index and while we're seeing the s&p the highest is potential, the nasdaq 100 remains far below what happens historically in terms of peak valuations. is what is at what higher on the day, it is now up by 2.5% and tech has been gaining oil prices have been helping. he also had energy earnings but oil prices have seen a big rebound. energy has helped propel the s&p higher in the latest leg up
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since august lows. 1.7% in the four-day drop is the biggest in two ears time. a quick check on the 10 year, a lot of investors are waiting. testimony before congress tomorrow. we see the yield on the 10 year 2%. though she is scheduled to speak on financial regulation, congress people can ask her whatever they like. there is the hope or the fear that she will say something about the trajectory. >> right. that will move the markets. thank you. as she was talking about the markets rising to the record, and the fed is in focus, janet yellen is testifying on the hill. we have got the fed president holding his press briefing tomorrow and stanley fischer is speaking in washington to round
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out the day. what will they all say. economist josh will help us read the tea leaves. we're speaking with a strategist earlier in the hour who said the market just wants the fed to be one and done and leave them alone. theyu think that is what are hoping to hear? >> that is what the fed is hoping to accomplish as well. they downgraded to hoping to have them only one meaning left. they can pull the jobs we have got report on friday and the month of october so fark, look a little bit on the weak side relative to september. september was a week number and whether or not the data will enable the fed to achieve the liftoff, one and done, that may be 2016.
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>> why is the labor data softening? to be seen.ins stuff takes time to filter through the economy. there has been concern about the on all of the concerns about global growth and financial volatility. you have to remember not all of that fed into the sentiment of employers or managers in the september support. we could be given information on how that had been received. we have seen consumer surveys a little bit lower than they were before the events in august. the october report will tell us whether or not we will see something parallel amongst higher managers. betty: dudley and yelling, they are all on the same page? >> they are committed to presenting a unified front. when you are already sitting on the fence, they're going to be
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pretty tightlipped and they will want to force the message in the october statement and say, we would like to raise rates and we expect to, but it depends on how the data turns out for us. there is always a risk something big could come out but that is not a guaranteed. one other thing tomorrow i want to pay attention to. frankfurt, which is pretty interesting because there is always talk of diversification of monitor policy. he has actually been very outspoken as being very dovish and not presenting a unified front that we have come to expect. she could have interesting things to say as well. unifiedpoil the whole front you talked about. you personally, what do you want to hear out from yellen tomorrow? >> the most we can realistically a stronger or weaker jobs report. give muchure she will
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more details must she takes december off the table. betty: thank you so much. good to see you, our bloomberg economist. that does it today. will forget erik schatzker sit down with the blackstone ceo about all of the things going on in the pharmaceutical world. ♪
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we are moments away from the closing bell. i am alix steel.
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joe: i'm joe weisenthal. ♪ >> u.s. stocks closing higher. the nasdaq at a record. joe: "what'd you miss?" >> we break down the latest earnings, including tesla and cbs. guest tell us while he -- why he is bullish on romania and kazakhstan. >> a very interesting time for the ferguson of -- pharmaceutical business. >> we begin with the markets. we extended gains. energy was the star sector, up 2.5%, 3.5 percent gain

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