tv Bloomberg Markets Bloomberg March 2, 2016 10:00am-11:01am EST
♪ vonnie: we will take you from new york to london in the next hour. a result we are watching, a historic super tuesday for hillary clinton and donald trump. the front runners strengthen their grip on the party nomination. apple versus the fbi, both sides face-off before congress. now the attorney general of the u.s. and apple's top lawyer plead their cases as the world waits to see if the battle will change the face of security and privacy. vonnie: michael peterson just back from medical leave, -- understand the performance of valeant.
julie hyman has the latest on the markets. after the uplift we had to a major agger -- average, we are seeing a bit of a downdraft, that a huge one but if you look in the sectors on the move, financials in the green, but that is the only group. we have utilities declining the most as bond yields continue to go up. a pretty diverse group in terms of what is falling, but i did want to point out there were -- the worst performers in the s&p 500 were those like monsanto. brown-forman cutting its forecast. dollar tree, which was out with its earnings and actually rose following those numbers, but analysts are weighing in and
saying they were not that great and downgraded to neutral. there is a little bit of company news moving things around. mark: of looking at -- are we looking at a poor day after a giant game? -- gain? julie: we are still lower by about 70 points, but we have had this and norm is ounce from the lows of the year. one of the other charts we have been looking at if you take a look at the terminal is the number of stocks in the s&p 500 trading above their 200 day average. as you can see, it has come way down. are trading above that level, so less than 50%, but we had this big bounce in the number of stocks. to measure this movement upward that we have seen. oil prices are part of the equation as well.
aey are taking a pause about 30% rally from the lows of the year. this was after and in the -- industry report. we get the governing -- government report in about half an hour. finally, also the dramatic movement we have seen in bond yields in the past couple of days. 1.68% for the 10 year and that at the mention has been putting pressure on utilities. interesting moves across assets both yesterday and today. mark: we have given up all the gains here. we were up as much as 9/10 of 1%. look at the main benchmarks in europe. 600, touch and go whether we will see that fit consecutive day of gains at the close. if we do, it will be the strongest stretch as the appetite for risk continues after china stocks rallied the
most since november over speculation the government will announce measures to boost growth. have a look at some of the currencies. i was looking at the pound against the euro because it has been rising for five consecutive days. sterling after falling last week with lowest level since everywhere he 2015, amid concerns over the upcoming british referendum on eu membership. that is the question many are asking. vonnie: let's check in on the first word news. ney: a powerful earthquake has struck off the western coast of sumatra. some measurements have -- i could cause widespread -- that could cause widespread disruption.
the front runners now appear to be plotting the race as if they run against each other. donald trump and hillary clinton each winning seven states on super tuesday. ted cruz has 161 delegates, marco rubio has 87. 1001 of theton has 2300 delegates needed. both clinton and trump sounded as if they are looking ahead to the fall. >> it is clear tonight that the states and this election have never -- the stakes in this election have never been higher and the rhetoric we are hearing on the other side has never been lower, trying to divide america between us and them is wrong and we are not going to let it work. >> ima unifier. hard toind that believe, but i am a unifier.
once we get this finished, i will go after one person, hillary clinton, on the assumption that she is allowed to run. day on thenext big calendar, march 15 with primaries in i've stayed. new jersey newspapers say governor chris christie should resign over his endorsements of donald trump. they added that if he does not quit, they -- citizens should put in a effort to impeach him. he was backing the billionaire without trumpause represents the best chance to beat democratic front runner hillary clinton. the supreme court hears a case that has the potential to affect millions of women. justices will hear arguments in the first major abortion case in a decade. lawcase involves a texas that imposes strict requirements on abortion providers. law hass say the
already caused half of the state's abortion clinics to close. global news 24 hours a day hour-by-hour -- hour-by-hour 150 news bureaus across the world . -- you have raise hundreds of thousands of dollars for the clinton campaign over the years, and he is with us on -- not a clean sweep for hillary, but seven states is a great night for her. do you assume that bernie sanders running but does not have a chance? he is prettyely, well-funded, so it is hard to imagine him just falling away. opinion,as now, in my there was a dramatic change after south carolina and nevada and now with super tuesday, i think we certainly are looking better and better every day and
yesterday is a perfect example. some say bernie sanders could do damage by forcing hillary clinton to go to the left. >> whatever damage if you want to call it that he has done has been done already. bernie sanders is a one trick pony. he says the same thing every single day in every single speech, so he is not going to come up with something new. we all know about what he wants to do, and hillary is not going to deliver or promise anything she cannot deliver. she is not going to give free education or retire everybody's loans or give free health care because the country cannot afford it. i think she is paying attention to all of those issues and the concern about the income inequality, which she has brought up. whatever bernie's input is, i think we have had it. mark: who does hillary clinton
fear most? it does not seem to be trump, it is either ted cruz or marco rubio. >> i can't speak for hillary. if you are asking what i think, i don't think she should be afraid of any of them. i think the other side is a zoo. i don't think there is any thinking person who would say that anyone of them is the kind of person we would like to see as president. hillary is the only person at thetable who has intelligence, the experience to really be a president. vonnie: there is a question on whether she should spend money now, whether her super pacs should spend money to target trump specifically or something more generic. >> at the moment, we are really focusing -- i would be focusing on donald trump. the delegate at count, it is not that dramatic. he has not clearly gotten it and
we will see what happens in florida and ohio and that will be specific. by the 15th of march, we will know how clear it is, what he seems to be the person to approach. i think hillary is sticking to her message, which has been very consistent. i hope she is not going to let herself be distracted by any of these people who are so irrational in their approaches. -- rallying african-americans, rallying latinos, rallying women. is that the same formula that hillary clinton will need to defeat trump if he does when the republican nomination? >> i think it is more than that. super tuesday was concentrated for the most part in the south where a lot of the population
you're talking about, particularly the african-american population is located. sure, she wants to when the latino and african-american group, but i don't think she has given up on youth either. it bothers me that younger people don't really appreciate what she stands for what she has accomplished and what her message is and hopefully, over the next several months, they will come to realize that she is not only a person that can be trusted, but that she has their interests at heart and she is not pandering. vonnie: so far, she -- bernie sanders outpaces her with voters under 30. will she need to release the -- >> that is a tough question. we all make speeches. who can remember all the speeches we made and what we said at different times. place,u're talking one
you certainly want to make people feel welcome and that you know who they are. i am certain that hillary did not do anything in any of these speeches that something she would be embarrassed about, other than the fact that she may have accommodated a different office -- different audience. i heard one speech she made to an investment bank a couple of and it was a very bland and broad speech about the economy. why should she be the only person -- i don't think anyone has ever heard donald trump yetk for or if we have had to hear him speak rather than blabber on. if everyone releases the speeches, i guess she will not have any choice. vonnie: we want to talk about what you are investing in next. still ahead, a roller coaster for the market so far. the fodder -- father of venture capital is. next. ♪
vonnie: you are watching bloomberg markets. i am with mark barton in london. let's go to abigail doolittle in the nasdaq. >> as we all know, it has been a rough start for markets in the u.s. this is certainly taking a toll on the ipo activity. there have only been five ipo's so far. four health care companies and one financial company. the nasdaq is very optimistic, looking forward. they have a strong pipeline and applications this year that are double those of last year as apparently many of these companies and their advisors are waiting for singles to go public. ofnie: is there some kind
market gauge that companies use as a determination of whether to go public or hold off? >> i spoke to a spokesman from the nasdaq and he says what these companies and advisers watch is the fear index. about 20, they hold off but below that level. , they become a little more comfortable another signal the nasdaq looks for is the return of these companies to the road, and the nasdaq remains confident and optimistic about the second quarter and second half on ipo market -- activity. the wave of cost cutting in silicon valley and raises the issue of volatility for venture capital. for a look at how these are responding, let's ringback a fourth -- 40 year cross career adventure -- venture capital. there is something to the eluate
in correction in startups last year, but still, bc firms invested rafting -- roughly $16 billion in companies, last year. what is the outlook? >> i think the real question is going to be going forward, what is going to happen to the unicorns. i had dinner last that with my said theer who unicorns are starting to develop another horn and they will look like towels pretty soon. -- look like cows pretty soon. about that was a powerful statement in terms of what we might he happening going forward. unicorns are the ones that should be going public and right now, the ipo market is frozen. it would be pretty hard to raise money at the levels they are at. the real problem is in the later stage, the growth phase of the market, where people are setting
into realistic valuations and relative performance. i don't think there has been that dramatic change in the early stage, the a rounds they call them. butably too many companies, there is no definition. -- definition. -- ellie office we see about 35 oblique, not a month and you can add that up over a year. the number of companies being formed, the entrepreneurial energy of this country is just blooming. mark: how hard file is europe -- how fertile is europe looking? how is it for startups from where you are sitting? >> we have several investments, unexciting payments company in london. we have another company in
estonia. we were just about to make an end -- an investment in berlin, a company -- a virtual reality company. europe is not where it was 10 or 15 years ago. is one of the hottest startup areas in the world, today. it is very hot. third ores not hold second place to anybody. place to an exciting be and we are looking at -- we have a company called skin links in london. we have a lot of companies out of london who moved here. vonnie: is this the year that we see these unicorns growing a second horn? >> that was the amusing part of that comment. we have to see. billion, valued at $40
where are you going to go? there are very many people who will acquire any company at -- especially at any appreciation. as far as i know, there have been virtually no ipo's in this market and also, it is important that in order to go public, you have to open the component and show what is your growth rate and not just revenue, but how much are you actually losing, because thatuch -- is what's usual and up until now, investors have told that whole of losses and what is happened and was referred to by your partner in london is, the problems have been where people are looking at some of these companies that are further along and saying wait a second, you can talk all you want about growth rates and revenues, but you are losing $2 million a
month and investors just aren't going to fund this forever. at some point, you have to start -- where is the beef? you have to demonstrate and bring this to the bottom line. we are definitely at that stage and there is a second and third look being paid to these companies that perhaps started three years ago and are at a more advanced stage and show results. mark: allen, thank you for joining us. it has been great chatting to you. still ahead on bloomberg couple ofusy day, a rough days for this company, valeant. can the chief executive right the ship? ♪
days for valeant. they delayed filing an annual report and was subpoenaed by the sec. was called pearson out yesterday, saying he needed time to understand the company's performance after his two month absence. is here, our in-house valeant expert. what are analysts saying right now? joe: this is really interesting. canceled, the company its earnings call, but then quietly told a bunch of analysts get on this call and then we asked about it and they canceled that call. yesterday, they made a couple of one-on-one calls between the ceo to what appears to be a select handful of analysts who are all pretty bullish on the stock and
had some one-on-one conversations where he told them he needs time to get back up to speed because he has been gone. he is in position and is going to be -- he said some positive things about the company, the stock was down around 9% or 10% and then these bills are they coming out to reverse those losses and close down less than 1%. it seems to of had an effect. vonnie: even hillary clinton getting in on the action. joe: she did, on super tuesday she put out an ad saying she will go after valeant pharmaceuticals. she has been hammering drug makers and people like marketing -- martin shkreli. i don't know if she was looking at what was happening in the markets, but it is one more hit by her on the drugmakers. mark: can michael pearson turn
the ship around? joe: there is a question of does this guy -- is he the cause of millions problems and also the salute -- valeant's problems and also the solutions? an sec investigation, 20% down on the week monday and part of tuesday, it is a lot. vonnie: still ahead on bloomberg television, yesterday's hearing on the hill between apple and the fbi. we talk about the next move on bloomberg markets. ♪
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it is not so sunny in london or new york. we will update you on food inventories where julie hyman has a look at the markets. julie: we have the industry report last night and it looks built in inventories is much larger than had been anticipated. was thelion barrels weekly client in inventory, about 2.5 million was what was estimated. hub, 1.2n's largest million barrels, we saw a decline in gasoline inventories, but not as much as inventoried -- as anticipated. face, badike on the news across the board in terms of this number and indeed, we are seeing the total inventory numbers climbing to a record.
if you take a look at crude prices, we are seeing a drop off in crude. here is the intraday price, down about 1%. it has been climbing coming into this report and now taking a leg down. it always tends to take time for investors and traders to digest these weekly numbers. thented to bring up one of charts that we have been this is the weekly change in inventory. build0.4 million barrel is certainly the largest that we have seen on this chart which went back at least six months on a weekly basis. the last time we had a weekly build this large in these crude inventories, this is not good news for the oversupply in the analysts a time when
are already saying it will take some time to work down the glut that already exists. even if we do have this production freeze that everybody is talking about, it will still take a long time to work down the oversupply. sure buthat is for also natural gas is at a 17 year low. how is inventories for crude oil impacting natural gas? the common thread is oversupply, there is just too much of the stuff. natural gas inventories on wersday at 11:00 a.m., so could see more movement at that point as well. in the meantime, i might as well call up crude oil behind me once then and we are seeing decline deepen, now down to
percent. -- now down 2%. while we are talking, i might as well put up what's going on with ae s&p 500 because we see move and that is what is happening as oil is making its low, so are stocks in the u.s. we are seeing that exact cliff on the stoxx 600 energy index right now. the oil sector has turned negative because of that you must inventory data. let's check in with courtney donohoe. courtney: hello. general says the cease-fire in syria has mostly worked. they say government and rebel forces need to show the good faith so humanitarian aid can be delivered to those living in the
areas under siege. there may be an new clue in an early two your search for the missing malaysia airlines flight. according to reports, authorities say a part was found along mozambique. -- is askingission for $760 million in emergency aid to help greece and other countries in europe tackle the refugee crisis. the proposal to tap the european union budget would be over three years, starting with $360 million this year. vonnie: thank you so much. in the last 24 hours, some of the biggest players in the fight between apple and the fbi came out to defend their positions and putting u.s. attorney general loretta lynch.
we asked winship it could be a middle ground -- we asked lynch if it -- if there could be a middle ground. >> law enforcement at any company in the court -- that is what we go to to arbitrate these subpoenas. we have a difference of opinion as to what the law or compliance means. we go to court. that is what we think is the current state of affairs and that is where we think this will play out. there is also the middle ground of discussing this in the large him -- in the larger forum of ideas. having a discussion about what it means to have both privacy and security. we do it all the time. people expect it of us. >> in the court, a brooklyn judge just roll that apple does not have to do this in a separate case. does that undermine your argument or change your strategy? >> it does not change our
strategy or reliance on the court. in that case we were disappointed with that decision. we will be resubmitting into a judge in a few days with additional information. i will also note that was the case where we were working very well with apple and they had agreed to help us with that regular device, an older device that is not involve encryption on it -- or anything like it until the issue became public and then they filed papers in opposition. we feel there is a path to discussion, to working on all of these issues as they come up. says there is no middle ground that does not put everybody at risk, that it is not just about one phone, but it is about everyone's phone and the future. >> in the present, we see how we balance privacy and security every day. until recently, apple was able to comply with our request and they have some of the strongest security out there and we have
not seen that parade of horror in suit in those cases, either. we have seen it done, we have finance and health care companies, all important sectors of the economy encrypted data to protect all of us, but they also maintain the ability to manage that data to keep us safe. mark: u.s. attorney general loretta lynch speaking exclusively to bloomberg. this morning, emily chang talk representing apple in this current dispute. >> i think that congress should consider the alternatives. they are put in that position in order to do that, think about solutions to these difficult problems. that is what this debate was all about, the government does not have the authority to require tole to redesign its iphone
disable the characteristics that it put into the system, which is what its customers wanted, there is no legal authority for that now. there has to be some discussion about how to solve this problem if there is. when you cannot conscript a private company such as apple to do something to change their products. they have civil rights to prevent that sort of thing. >> i spoke to loretta lynch who said let this be decided in the court. under any circumstance, would that satisfy apple? >> i'm amazed that she would say that. it would not solve anybody's problem. you might have one court going one way, and another court going another way. the fbi director himself said this is a problem.
he said it is one of the most difficult problems he has ever faced as the director. before that, he was deputy attorney general. this is something that congress needs to debate one way or the other. if you do on a case-by-case basis, you will have different outcomes in different cases in different parts of the country. the director says they have 13 other cases in which they are trying to do this in federal courts. the manhattan district attorney said he had 205 iphones he wanted into. you can multiply that by every jurisdiction in the country. a case-by-case solution is no way to go about this and i am amazed that the attorney general would say that. vonnie: that was apple's attorney speaking yesterday on bloomberg tv. emily chang joins us from san francisco with more highlights from these interviews. >> hey there. we took that one step further
and i said, are you saying there is no middle ground and he said he does not see middle ground. apple says there is no way to compromise that would satisfy them. a lot of fascinating arguments that he put out. loretta lynch also challenged that this somehow violates apple's first amendment right because apple is not a target, they have not alleged that apple has done anything wrong. another interesting argument that we discussed is the government has invested millions of dollars in building technological capability across the notice states from gps to save internet. apple has benefited from all of that, what if the government did a condition that it had to comply with law enforcement in order to benefit from the technological innovation? take a look to the response. extreme,d hate to get but it reminds me of the 13th amendment. the u.s. government made it
illegal to have slaves. that is obviously an overstatement and i don't mean to mean that literally, but the government cannot conscript private citizens. the government can't say in order for you to use technological information that might have been produced and put in the public domain by the government, you have to agree to work for the government. that does not work. i don't know where that could come from. >> another interesting thing that is not being talked about, ted olson himself watches wife -- lost his wife in 9/11. she was in the plane that hit the pentagon. thatst shows you the links you can take in this argument and you have to separate the rationality's from the emotion. today is the deadline for the companies to file in support of apple. apple is supposedly having a
product reveal sometime in mid march. that is what all of the apple blogs are saying. it will be interesting to watch where this goes. in formert's bring senior adviser for innovation to secretary of state hillary clinton and also author of the best time seller -- new york times bestseller. do you see any middle ground between the two positions? don't, i spent too many hours in the white house situation room debating scenarios like this and 90% of the time, the government is in the right and the technology company needs to comport. in this case, what the fbi is technically asking apple to do is to hack its own product, literally rebuild ios with security flaws so that they can given it and i think that
the very reasonable goal of trying to get the communications of this terrorist, what they are doing is creating a series of secondary effects that are wrongheaded. the: if apple does let hypothetical -- if it does open the back door to the fbi, what does it mean? what does it mean for the chinese or the russian, for the other nonstate actors? >> that is the right question to ask. of appleree days hacking its own product and building a backdoor for the fbi, you know who else will walk in? unit 61398 from the people's liberation army from china and a bunch of other nonstate actors will follow soon after. we live in a world of 16 billion connected internet devices. in four years, that number will be 40 billion.
need stronger encryption -- cryptography and the idea that we would build backdoors is dangerous. as the joke goes, it is not a cloud, just somebody else's computer. what if we have a court that does not have a full bench of justices? >> it looks like apple is pretty done in. the fbi director is dug in as well. these are not happy conversations they are having. i could see this going to the supreme court and anticipate that it could be deadlocked. will ultimately have to go to congress and therefore, the american people. vonnie: we will continue to keep an eye on this. this is the deadline for other companies to file their brief. break, you canhe
mark: live from london in new york, i am mark barton with vonnie quinn. we are 45 minutes from the market close in europe. we were higher earlier, went down because of that u.s. inventory data. for the fifth consecutive day, it will be touch and go whether we finish higher for the fifth consecutive time since october.
yield has been pushed higher in the u k and germany and italy. big votes of confidence taking place in spain this afternoon. will the socialist leader get the vote of confidence he needs? unlikely, so say the specialist out there. quick peek at the level of sterling against europe, looks like it is rising for the fifth consecutive day. since july 2015 that happened, so that is an interesting move in the currency markets. vonnie: if you take a look at the euro versus u.s. dollar, several different kinds of traits going on and another reason why the euro is staying down against the dollar is the strength of the u.s. data in the last few days and the idea that there might be more divergence ahead. gold is up about half a percent.
sales for existing businesses will increase in 2017 at more than twice this year's pace. the production of chemicals is expanding. honeywell just dropped a proposed 90 -- $90 billion offer to buy united technologies. sporting goods chain sports authority has filed for bankruptcy protection. they said they expect to get a $595 million loan that will allow it to keep operating. with authority has talked with other sporting goods chains about selling some of its stores. that is the latest is this flash. we have our eyes on the newest member of the maserati family. i hope you are watching because this is a big one.
bloombergiott from news has a first look. >> maserati has finally debuted its suv. this is the first suv from the tie-in brand and is made to go up against new suvs from the --es of bentley, jaguar maserati hopes its -- blues -- blows some new life into the brand. it will take some doing to be the excellent -- but wanted does come with a distinctive look and feel. it comes with a twin turbo gasoline engine or 275 horsepower turbo diesel engine.
it will hit 65 mile per hour in 5.2 seconds. even better, it comes with full off-road capability, not that you will actually use it and the lowest center of gravity in its class. there are five levels of grandparents also next are one oneparking -- plus an extra for parking. a large frameless door window. the back window is tapered and streamlined through the rear. on the inside, maserati has included hand wrapped leather plus enough seating in rear room for five adults. it looks and feels like what you would expect from the maserati family. in may on sale in europe ended september in america.
that was hannah elliott reporting on the new maserati from the geneva motor show. you can read more about luxury cars at bloomberg pursuit. a new development on the debate according to ibm. showske referendum poll 41% of stroke -- correspondence want to stay in the european union,. 41% want to leave. it interesting because we have seen different polls. if the media polls in a british newspapers and british media in general are closer than that. mark: that is why you have seen such a huge volatility in the currency markets. you should separate telephone poles and internet polls because the telephone poles have been
putting the and campaign ahead, but it's the internet polls that are far closer to. putting the lead campaign ahead. if you look of the odds right now, there is a roughly 35% britainhe bookmakers of boasting to leave the eu, -- before the referendum in 2014, we have 128 days of uncertainty ahead of us. european markets close in 34 minutes. one of the many questions will be answering. ♪
this is the european close. vonnie: we are going to take you from new york to london to capitol hill in the next hour. after their big super tuesday wins, hillary clinton and donald trump focus on each other, but is it too early to count the other candidates out? mark: italy's finance minister huge a brexit could have negative consequences for the eu. vonnie: and a crucial vote underway in spain. the acting prime minister is mocking the efforts calling it a farce. we will look at how it all could end. are half an hour from the close of trading