tv Bloomberg Markets Bloomberg January 20, 2016 3:00pm-4:01pm EST
told >> it's 3:00 p.m. in new york, 8:00 p.m. in london and 4:00 p.m. in hong kong. welcome to "bloomberg markets." good afternoon. i'm betty liu. it has been a whirlwind of a day so far. mass selling across all the major indices. at one point the dow down up to 565 point. we're coming off our lows of the session, particularly with the nasdaq. we want to get to the markets desk. >> it has been a day of superlatives, for sure, but we are in crawl back mode. the s&p 500 is down by about one point 8%. the dow is down by about 2.2%. the nasdaq crawling back, down by about only .1%. at one point at the worst point of the day, these were all down on the order of 3%.
the dow is still on pace for its worst january on record. will be keeping an eye on what is happening here. let's also look at what is happening year to date with the majors. intraday, the s&p 500 is down 2% . if we can pull up the majors, i did want to talk about that because those are much more accentuating in what is happening with the pain, gear to date, especially since last friday. we saw the dow and s&p were down 8%. date especially since last friday. hop into my bloomberg terminal. i want to show you the function that shows the dow jones monthly price change by percent. you can play along at home if .ou type in the code i want to direct your attention to the right side of the screen. the blue bar is what i'm
focusing on. 9.9% is the negative percentage change on the dow. this has not happened in at least a couple of years or so. this is showing how much of a selloff is happening with the dow, as well, of course, as we were talking about with the s&p, as well as the nasdaq. betty: oil suffering one of its worst of clients so far, right? >> oil -- it's just bad. how many times have i said this? it keeps going. let's look at what is happening with oil. .xplain 7% here if you are long on oil, that for you. if you are short on oil, this is good. $26 handle,he $26.50. with crude falling, you can expect the s&p energy sector is also falling. the s&p energy sector is down by about 4.5 percent.
you can see scraping the lows throughout most of the day, but off the session lows we saw around 12:30. i want to get to some safe havens. the yen right now is strengthening and has been, down to 1.16 against the dollar. the u.s. 10-year yield is down eight basis points. still under that psychological 2% mark. gold futures up 1.3%. love our bloomberg comparisons -- that oil is cheaper than milk when you look on the futures market. >> milk does a body good. oil, not so much. betty: let's get a check on the headlines. mark crumpton has more from our headlines. is inpresident obama detroit today, touring the north american international auto show after the best year ever for car sales. it is kind of a victory lap as
mr. obama works to establish his legacy, including the bailouts of general motors and chrysler during the first months of his presidency. u.s. defense secretary ash ministerss a defense from six nations have agreed to step up the fight against .slamic state secretary carter says the countries have plans to take that key cities in iraq and syria from the militants. carter also announced 26 nations as well as iraq will meet in brussels next month to continue negotiations. attorney general loretta lynch is defending president obama's executive actions curbing guns. appearing today before a senate panel, she told lawmakers the president took lawful steps to stem the gun violence that kills and injures tens of thousands of americans each year, but republicans pushed back. the subcommittee chairman accused the president of "grandstanding" and engaging in anti-gun theatrics.
finallyts say they have solid evidence for planet x, a true ninth planet on the fringes of our solar system, thought to be almost as big as neptune and orbiting billions of miles beyond neptune's path, distant enough to take 10 to 20 years to circle the sun. as two caltech, researchers call it, has not been spotted yet. they based their findings on mathematic and computer modeling and anticipated's discovery via telescope within five years -- anticipate its discovery via telescope within five years. 2015 was near a quarter of a degree warmer than the last global records set in 2014. a quarter of a degree may not sound like much, but on a planetary scale, it is huge. most previous records were measured by hundredths of a degree. global news 24 hours a day from
the bloomberg first word desk. betty, back to you. more now on today's selloff. we are climbing back from our lows of the session. our next guest says we are in the midst of a cyclical should'sn in which we evaluation falling back to longer term attractive levels. -- we should see valuation falling back to longer term attractive levels. good to have you with us. hang on. i know we are having some microphone trouble. were going to get you a new microphone in a moment so we can hear what you had to say. in the meantime, as i mentioned, we are coming off our lows of the session. the nasdaq is down now just .5%. we can hear you. ok. tell us -- does any of this remind you of 2007-2008?
>> absolutely not, and this is the key message we are sending to clients. this is a very different environment. you had a lot of leverage in 2008-2009. the consumer was levered, the government was levered, the banks were levered. we have really deleverage the whole system. really, what we are looking at is a repricing of markets. the biggest concern is global growth. we are trying to figure out where is global growth. china has been a concern. you are seeing selloff in the global space. topline growth, revenue growth has been slowing, and you had the fed raise rates. it's natural for the market to reprice the price-to-earnings ratio or what we call the p/b ratio.- the p/e you want to be in large cap, high-quality companies and reduce our exposure to small caps. spreads andg credit
high yields expand. we do not want to be there. we want to reduce and be an high-quality bonds. betty: where are we in repricing? mary ann: the average stock in the market is already off 25%. small caps are off 20%. transports are off to percent. some of the larger cap stocks have held up market averages. the market is going to try to hold, and if that does not happen, the next support within the market is about 1600. the risk is that you do get another 10%, but you are only halfway through. the question is -- where are we in the cycle? we call this a cyclical bear market. we think we are in the early stages -- betty: the early stages? ok. it can last for 13 should you see market
pullback to around that 1600 level, this is the best buying opportunity clients are getting. .etty: that is quite a big call the markets were gaining even before 2013. what did you call that? mary ann: it was all a bull market. terms cyclical and secular had to do with the trading patterns. we broke about the highs of 2000 and 2007, so we are in a totally different period. we think markets can trend higher over the coming year, and there's great value being priced within the market. is i am to read this correctly, perhaps look out for another 10% correction or so -- if i am to read this correctly. you are calling that the buy of a year. lifetime.of a our long-term price objective on the s&p is 3500. over the next 10 years, we think
there is significantly more upside to the equity markets van there is down side. it's about looking at the long-term. this is episodic volatility. bouts of violent volatility are bringing opportunities for clients to reposition portfolios, and that is how we want to look at it. when we value stocks versus bonds, stocks are so much less -- cheaper compared to bonds. here is a very important statistic -- every time the s&p yield is about the 10-year treasury yield over time, stocks go up. now,u look at it right that is what is happening. these are some of the key long-term signals we are looking at to buy the markets. betty: bill gross was on earlier saying that this stock market basically shows a failure of central-bank policy. what do you say to that? mary ann: i would not go that far.
i think the market is trying to reprice growth. china is really concerned with setting gdp somewhere between 5% ande sent and 6% -- 6%. we are trying to tell clients that 70% of gdp growth comes from the consumer, and the consumer is doing very well. this decline in oil always benefits the consumer. it is about what they are doing with excess cash -- they are saving, paying down debt. we may not have seen the effect yet. it takes a few quarters. .ary ann: it takes a few they are not doing retail, but they are eating out and paying down debt. betty: what do your charts say about where oil is headed? mary ann: everybody has been talking about the $20 to $25 handle, and you are almost
there. you are in the range where oil should begin to stabilize, but the question is -- what happens after that? this magnitudef -- remember we were over $100, and we are talking about $20 now, it's going to bounce along the bottom for a time. we're not looking for it to rise rapidly, but over time, we would expect it to get back up -- betty: because we expect it to work through that supply? mary ann: that is correct. you will eventually stabilize, and you have to work off that supply. betty: thank you so much. good to see you. this selloff,on which is moderating now at a pretty rapid clip, particularly for the nasdaq. as i mentioned, that has climbed up the most among the averages. we will have much more. here is the doubt, also climbing back from its lows of the session -- here is the dow. ♪
betty: welcome back to "bloomberg markets." we are about 45 minutes away from the close of trade today. first look at the s&p, which you can see was down over 3% and now is making up almost half of those gains at this point. same thing for the dow, which was off up to 565 points today. it is also cutting its losses in half. we were at one point headed towards our worst close since early 2014. finally, with the nasdaq -- this tech wasremarkable --
one of the worst performers and now is the second best on the s&p, but on the tech-heavy updaq, we are almost making all of those losses for the day. selloffts continue to for the day, how will that impact mergers and acquisitions after the record year last year? what about access to credit to finance some of those big time in many deals? earlier, erik schatzker spoke with a ceo from doorposts -- from davos. >> many are planning for slow growth. what happens is you, the camera and people portray their best side. in public, you will hear people's optimistic hopes for the world, but what you see in m&a is people's realistic thought that they have to take cost out of the system, any cost they can.
in the junk markets and the lower end of the junk markets, it's very difficult to raise money, and if you are in certain industries, impossible. erik: oil? ken: energy, and retail is getting harder and harder. i think the credits are going through kind of a reset. the difference between high-grade credit and low grade credit two years ago was ridiculous, and i think you are now going back to normal. if there is a repricing happening and some borrowers are being shut out, what impact will that have on him in a this year? we have not seen any downturns in the conversations. i will say that. erik: really? ken: the amount of discussion about what today -- what to do,
i will not say it is better, but it has not stopped. there's a chance we could see 2016 be as good a year as 2015? you measure on how it. there were large transactions that were difficult to replicate. number ofk about the transactions, possibly. it was fairly flat on number -- i do not have it right on the tip of my tongue, but i do think you will see more companies find ways to take cost out and up their credit and do things to solve problems as a result of a slowdown in the economy. k: will we see another hundred billion dollars transaction? ken: i don't know the exact -- erik: you have been talking to a few people. ken: in the day is about taking up cost, and in order to take up enough cost, you have to merge with a fairly sizable company relative to yourself, and that's one of the reasons you have seen
so many megadeals. betty: that was the ceo of moles and company speaking to erik schatzker in davos. quick note -- the nasdaq index .as turned in the green, up .3% it has been very rapid, the gains we have seen since about 1:00 p.m. today for the nasdaq. remember that at one point, it was down over 3%, a loss of 163 points, so we have made that back and then some in just the last couple of hours. the equity markets not the only ones seeing a lot of volatility right now. bond buyers taking fewer chances on risky debt and demanding 16.6% on extra yields to on the lowest rated u.s. corporate bonds. lisa wrote about this phenomenon for bloomberg. bartels was telling us to look at the high-yield market and how they are repricing their
risk right now, the spreads are widening, and that's what we are talking about. lisa: exactly. conclusions are perhaps a different than what she was talking about because historically, credit has led equities. in this cycle, it has been no different. high-yield started spilling off meaningfully last year around august, september. the drop in the overall high-yield market in the world sixped 7.7% in the past months, which is substantial, especially for credit. betty: we should have been listening to the credit markets, then. lisa: right, but if you listen to the credit markets now, they are still going down and somewhat sharply, and you are seeing these divergences that portend more pain ahead. if you look at what we were talking about, the lowest rated bonds yet, they have gotten particularly hammered. the triple c bonds are yielding on average more than 19%, almost double where they were at this
point last year. that is an incredible amount of yields. some of these, you could get your money back by clipping .oupons for two years the big question is and the big --r that is keeping up trip keeping up credit traders at night is -- are we headed toward another recession? right now, these markets are flashing recession. perhaps they are overreacting, but you are seeing tremendous like qualities that have persisted for so long. we are now at the whitest estergence -- the wid divergence. it's puzzling. is this a technical factor? is it more selling, or is it more significant? this is really what people are looking at, and they are quite concerned. eye onwe will keep our that, and i know you will. we will stay on the markets. much more ahead. ♪
>> stocks staging a strong rally at the end of trading. -- and joining the has -- u.s. markets clawing back from their lows. i believe we are now at about the 28 level. last time we saw numbers like this was when we were in august. with that said, the fix -- the vix falling. what do you make of that? in august, that was after almost three years of being an environment of structurally low volatility. you cannot overstate the
importance of appreciating what that means. our theme has been to shift to a more defensive posture portrayed since 2015. cannot say this was entirely unexpected, but certainly, the magnitude of this event can and is being debated. we were talking about how people are always honing in on talking aboutt the spread and the intraday on the s&p. what did you want to hone in on? jim: the realized movement on the s&p 500, something to look at, something to track, the spread between the high and low on the s&p 500 intraday. the quiet multiyear period that followed was about .9%. since august, the number has been about 1.5%. the volatility
people are seeing is sustainable for years. >> we'll have about 40 seconds. yahoo! -- why yahoo! and what do you want to do? value will be realized one way or another. , whichn 13% of alibaba reports next week. yahoo! on february 2, and the bottom line is either via baba or the structuring -- the restructuring expected when yahoo! announces, we think they will move more than 7%. we just want to buy calls out right. >> thank you very much. more "bloomberg markets" next. please do not go away. ♪ the only way to get better is to challenge yourself,
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"bloomberg markets" special report on this wild market day we are seeing. we are joined by our team, alix steel and scarlet fu. what about this comeback? biotech leading the way, tech doing the worst, and now they are one of the best performers. what's going on? rlet: it's really impressive, and i pointed this out earlier, when we started to see stocks pare their losses, is that oil has not participated. we are off the lows of the session, but still down for wti. to decouple, the worst performers on the dow, but that decoupling allowing the nasdaq some breathing room and allowing it to move into positive territory. betty: we will talk more about that in a moment, but speaking about the nasdaq, i want to get to abigail, who is live at the nasdaq with much more.
abigail: another day of wild intraday volatility at the nasdaq and the big turnaround you are talking about, and it was led by biotech. greeniotech index with earlier this afternoon and now sharply higher, and the reason why the nasdaq is in the green has to do with the other averages. by real buying, or is it the brief reprieve of selling exhaustion? looking at one stock that has not turned around at all, micron, the worst percentage and down in the nasdaq nearly 30% year to date on top of last years 60% losses. micron was a turnaround darling idea by many analysts at the end of last year. so far, that thesis is not panning out. behind that turnaround, celgene is a big point of influence
after credit suisse initiated coverage and an outperform 149ng at a price target of dollars. so far, celgene is outperforming the nasdaq biotechnology index. betty: thank you so much. what a ride it has been. we were reporting that nasdaq lows today,at its but now it is in the green. all the big tech giants had big, big declines, some of them moving below their 200-day moving average. one unusual winner was twitter. at one point, this talk was up nearly 10% -- at one point, the stock was up nearly 10%. what gives? let's talk to an equity research analyst at sgm capital and also ,ur bloomberg editor at large cory johnson.
i think there were rumors about twitter being bought, and news corp. came out with a few comments that they were not interested, but it sounds like some people are thinking twitter is in play. victor: i'm surprised it took this long for the rumors to start to circulate, but i think twitter is attractive at these levels. i think it is a unique asset. on a monthly basis, it touches all that 800 million users around the globe -- it touches 800 million users around the globe. at this level, it is definitely attractive. what kind of company would be most attractive acquiring twitter? victor: i think google makes the most sense. not for lack of trying, though. twitter mixable platform for them, giving them access to social media, which google has largely missed out on.
aen facebook as well, but traditional media company could come in as well. cory: the thing is trading at 50 times projected sales -- 50 times projected earnings, numbers that they missed on occasion. they are seeing virtually no growth in the u.s., dramatically slowing growth internationally. twitter today may be all twitter is ever going to be. twitter has a bevy of investor concerns today -- i will be first to admit that. user growth challenges, employees selling stopped, employees departing since jack dorsey came on board -- that was not supposed to happen, by the way. most of that is priced into the stock right now. it's trading at a significant discount been where it used to. cory: it is cheaper than it was. victor: also cheaper than facebook. cory: facebook is infinitely
larger than twitter and its growing users faster than twitter is, even though it is infinitely larger. victor: facebook has proven itself. there was a time when facebook was suffering from the same investor skepticism we are seeing with twitter. i think they will overcome it. it will take time. i think investors could use this pullback to buy into the stock today. betty: it's easy to talk about twitter on a day like today when all other stocks are down, but in reality, is this a case where we have seen a lot of elling, it down 53% over the past year -- we have seen a lot of selling, it's down 53% over the past year. decade,over the past whenever there is any sort of pullback over the macro market, internet stocks tend to over index on the downside, and that's what i've seen. if this passes, which i assume it will over the next several weeks, i think these stocks will bounce back. i focus on stocks with solid
management teams, solid balance sheets, the stocks that benefit from secular gross drivers as well as a particular market share within their particular vertical. amazon fits that, but there are other names within the space , which haveom meaningful upside potential. qvc, which is a tv shopping truly an internet name, i have covered it for a decade, but it has leveraged the internet for sales. the broader pullback, i think, opportunities for investors who missed the run up in the stock will be able to get back in. there was this comeback in the nasdaq, right? we are well in the green right now. what do we read into a day where we are taken down by oil, and then tech is helping us lead the
way back? what does that say about the characteristic of this market? pretty jittery to be sure. i actually have another chart to show you. going to pull it up. it gives you a flavor of how while they day it has been. so far, we've seen a 538-white swing in the dow jones industrial average from two to in the-- 538-point swing dow jones industrial average .rom peak to trough he gives you a sense that this volatility is just increasing and we have not gotten to a point where it has leveled off yet -- it gives you a sense that this volatility is just increasing. that is the public tech market. what about the private tech market? cory: one of the things that happened when the dot-com companies blew up in 2000, 2001, was that they were customers of each other.
.echnology for technologists today's technology boom, including a lot of private companies, are selling technology to a lot of private companies, not just other tech companies. we had a company on last week with a software service company with a billion dollar backing, yes, another unicorn, but they are selling to fortune 500 and orton 5 -- fortune 500 and fortune 1000 companies. that is their customer group. this is not the technology market of 1999 because the customers are very different. the technologies are being employed across all the industries, not just other tech companies. >> that is an interesting point. we see more sustainable models in the private space, yet, i feel cost have not done well when companies have come out when companies are looking for funds -- ipo costs have not done
well when companies have come out looking for funds. victor: i have spent a lot of time talking to ceo's of private companies. it is challenging. they are admitting that it is getting more difficult to raise capital. we're starting to see that behind the scenes. i think the companies that mirror the same secular trends you see in the public market -- for example, facebook -- have benefited from these trends i've talked about. those are the companies that i think will be the ultimate winners over time and be successful at raising capital and getting that valuation after becoming public. cory: vc's have pulled back a lot. a lot of venture capitalists just walked away in the fourth quarter. unicorn,menon of the while we seem like we are hearing about it more, it's actually that vc investments were down in the fourth quarter. ,etty: thank you, cory johnson
pretty much cut our losses and half. health care is an index that has turned in the green, and speaking of the green, look at the nasdaq -- it is a little bit off of the highs it hit a moment ago, but it is struggling to stay in positive territory. it's time for a look at the biggest business stories in the news right now. glencore has shortlisted a handful of groups to go to the next stage of its agricultural unit. it is seeking to pay down $12 million in debt. more fallout from the volkswagen in missions scandal. -- emissions scandal. a suit accuses the company of andptive trade practices air-quality violations.
according to a filing last month in connecticut, a billionaire entered into a credit agreement with morgan stanley. the financing documents reported today by "the new york times" do not disclose the size of the credit line or interest rates. businessour bloomberg flash update. time to go inside the terminal or more insight into today's market day. you have some charts for us. scarlet: we were talking earlier about stocks have recovered but oil prices have not so much. i was looking at the energy sector. the xop, which tracks oil exploration and production companies, is up right now, just barely. i was surprised to see that. one thing about energy stocks overall is that they are way oversold. come inside the bloomberg terminal, and you will see what i mean. the top panel here is the share price, and there has in a lot of pain since the start of 2015.
it is down 50% since january 1, 20 15. this is the relative strength index on the bottom. pay attention to the green line, which indicates a stock is oversold, versus the red line, which indicates the stock is overbought. when the line gets to oversold condition, it should indicate it is right for rally. we have gotten here before. this point in 2015. a second and in 2015. again in august, earlier in december, and again earlier in january. has not actually rallied in a sustainable way. the question is -- what will it take? there's no worse time to try to pinpoint that them now, right? >> but the idea that you are just buying it for an oversold bounce is different than buying it for a long-term fundamental play where you need oil prices to stabilize at a fundamental level.
we talk a lot about how the high yield space is blowing up, which is focused in energy, but if you look at investment grade spreads, how much investment demand -- how much investments demand, you can see it's blowing up everywhere. it is busy, but it's worth it. this yellow line is energy. we know spreads will be blowing out with energy. this blue line is communication, and it's quite high as well. the red line is materials. that seems to make sense, but it's really, truly all sectors. this is health care. senior financials. the purple line is utilities. the idea is it is getting more expensive for all companies to borrow. were talking to someone for medical market asset management yesterday, and he said that investment grade widening is truly one of the biggest risks in the market and how it percolates through other assets. we could be much further along in the cycle than the fed or
investors know. betty: it's one thing for high-yield credit spreads to be blowing out, but when investment grade spreads start widening as well, that's when you have to think there's something more to this. i know you guys are going to take over bloomberg markets coverage. we are a little bit over 12 minutes to the closing bell. we are moments away from the close. ♪
dow industrials earlier lost about 450 points. over 3%, so about 500 points. scarlet: we have more than cut that loss and half right now, but oil prices continue to stay lower. they have not in much of a recovery. the pairing of losses and stocks kind of happening on its own. alix: s&p energy stocks down about almost 3%, but at one point, they were down 5%, so even though oil is the biggest loser in the s&p, they are still paring their losses. i do want to bring in mike and oliver. what did you make of -- what was today? today was today capitulation? so ugly thatten
people are trying to pick off a bottom. that august low or an low from 2014, it's enough to stem the bleeding and a session like this. who knows how long that will last and if we will see even lower lows? i've and harboring on about that harpingel -- i've been on about that 1867 level, and it blew past that. when it blows through a level like that, it's kind of anyone's guess how are it's going to go. blew through the october 2014 lows, too. ofbut then it did pare some its losses. mike: people see these new lows and think you cannot get much worse. ifld not be surprising to me these are the lows of the cycle. you showed on the chart
earlier, for the s&p to get is such an an rsi rare thing, and it's very rare for it to stay below that level. it is a momentum indicator. it often triggers a very sharp rebound. the fact it is not closing there is interesting. inside theme bloomberg terminal. this is the s&p 500 on an intraday basis, showing the highs and lows throughout the day. backve that support line in august, back in september, and here we go -- we blew through that level today. a triple bottom is fairly rare. even if you get it, you do not hold onto it for long. you can see an interim bottom, 5% to 8% rally, but then we are going right back.
we are not done. all of nothing has changed since 9:30 this morning as far as the big picture goes -- oliver: nothing has changed since 9:30 this morning as far as the big picture goes. we have talked before about how there's a lot of outstanding shorts, even from the august selloff. people are looking for a point to where they find valuations compelling. a lot of the weakness this year has been people realizing their stocks have been up for a long time. they have done it on the back of qe and they want to see if those prices adjust to more regular levels. level,ey had a certain they are obviously going to buy -- when they hit a certain level . , andcompanies are rallying of course, we are also in earnings. get a couple of companies that have strong signs -- i don't
think that's what we were seeing today. i think it's a lot of technical and short covering happening. today. pretty weak bit in the little afternoon. seems like a lot of people saying here's a certain level we blew through. we are not going to be able to hold that bottom or whatever it may be. in terms of the big picture, nothing has really changed at all. while you were talking, i just pulled up the chart. the relative strength index of the s&p 500. come inside the terminal. the upper panel is the share price. if you go to the bottom panel, i'm going to expand it, the red line indicates overbought and the green line indicates oversold, meaning it's priced for a rally. we are bumping along that green have gotten there before in august. we went quite low, but we are bouncing quite up. you can see we quickly hit in overbought conditions in early
november. mike: tells you what you need to know about the momentum shifting quickly from one side to the other side of the boat. as this goes on, to me, it's interesting how many indexes we keep picking off. today entered a bear market. it's only about a percentage or two away, so we are pretty close. scarlet: good observation. emily chang has a look at some of the biggest tech movies we are watching. aily: the nasdaq buyers and fleeting the turnaround today. keep in mind it had a pretty. -- the nasdaq buyers index leading the turnaround today. chipmakers also leading the come back.
the maker of touchscreen technology for mobile devices and computers potentially closer to a deal with a tiny group of investors, a deal that values the company at $4 billion. there has been a lot of m&a in the chip industry. the market rewarded the companies that got together, so this potential deal could be a sign that there is more m&a in this space to come, but let's take a look at some of the movers that fell more than the average. one of those has been square, down 8% over the last couple of days. one of its biggest competitors came out with a new card reader that could eat into square's market share. it's a card reader that small businesses could use, and we may .ee investors unsure twitter has also been down for the last couple of days, yesterday hitting another all-time low. we saw twitter shares popped today on a report about a possible takeover by news corp.,
which flatly denied that report, but lingering concerns about if twitter can re-accelerate its user growth and if jack dorsey is the person to do that. looking at bigger tech stocks -- apple, google, netflix paring back some of their losses as we head into the close. investors looking for safety, it seems, on what has been a crazy day. scarlet: crazy day indeed. we will be checking in with you again shortly, but as we count down to the close, you mentioned that it is earnings season. we are just getting into the thick of it, but it kind of seems like an afterthought. oliver: there's a lot of things going on in people's minds right now. again, as we have pointed out in the past couple of earnings cycles, it has been a pretty volatile ride. justther thing i was
thinking about in terms of looking at what is happening for the larger picture, a lot of the focus has been on what is happening in the bond market and the higher yield bonds and what that indicates about stocks. we were talking with some folks bearish in the long-term, but right now, they say they think we are a little bit oversold, and they think it's because we have surpassed the losses. , but you can see the stock has shot over that in terms of losses. if you're someone that looks at corporate bonds, you might see a little bit of comfort that it has gone way past those losses. together, itg it seems like we had these losses today, we had markets come back today and we could see some kind of downs presumably tomorrow based on what you are seeing, but that's not necessarily the
longer term trade. there are still fundamental issues that have not been resolved in the market -- oil, china, the head -- the fed's continuing tightening. that could continue to reverberate. mike: it almost feels like some sort of tantrum to me before the end of the month. some sort ofe want dovish words from people in the fed right now to say they are not going to be that aggressive. i feel like the market screaming out like a problem child. the fed has been radio silent on most things, not saying much about what had to do with the rate increase. alix: we saw the fed going hold in september, although some say that the bar for a hike is quite low because you have already started. volatility inthe stocks, and it's amazing how it has gone to the fed funds. the other thing, when you look
at what is happening in the sector, banks have [bell] anchor: ed we have. closing in the red. some negative territory. , almost sixfalling points, whereas the s&p lost about 21, 22 points. the nasdaq had fallen as much as 565 points. really, when you look at where we are, the s&p 500 closing at the august lows, going back, ?hat, 7, 8 months there are segments of the market that have already fallen into a market, including the russell 2000, which tracks small caps.