tv On the Move Bloomberg March 29, 2016 2:30am-4:01am EDT
guy: welcome to "on the move." we are counting you down to the european open. i'm guy johnson alongside hans nichols. he is back in germany here here is what we are watching. the dollar, will yellen put the whole back in her cage which he speaks in new york guy: that is the question -- new york? that is the question. react?l the yen modi on the offensive. the prime minister hits back at critics who say that he has gotten lucky with prices.
good morning. i think there are two stories when you talk about. what is happening with his hijacked aircraft. it has landed in cyprus. people will be asking questions about egyptian security and zoomable he the hijacker has had some access to the cockpit. post 9/11, that is a big no-no. hans: that is the surprising story. we don't know if they got the cockpit but we know they have landed. although they were able to diver the plan, that doesn't mean they were able to get inside whatever reinforced doors. we are going to see whether or not yellen is going to reiterate her dovish position. the dovish position is the one that is on the table. the get what those governors -- forget what those governors and presidents have been saying. guy: it is turning out to be quite a battle. my question is can should be more dovish?
dovish, the is as dollar is not going to move much . it is interesting to see where market is priced in. we are 28 minutes until european equity market open. the legacy from the states looks great. -- alexey from asia was in great. -- the legacy from asia was not great. but he pulled up .8%. -- the ftse pulled up .8%. a fairly robust start to the post-easter trading session. hans: the could playoff what is happening with the yen. -- that could playoff what is happening with the yen. a look at other things. the shanghai composite is over -- is down over 1%. the brent really pushing close to that $40 a barrel. let's get more now with camus
utha.- kum kumutha: u.s. -- apple has dropped -- it unlocked the phone with an unnamed third party and without compromise in any data at apple says the case should have never been brought. police have shot a man after he pulled a weapon at a u.s. capitol checkpoint. officials have identified him as 66-year-old larry dawson of tennessee. they say he was previously known last october, arrested for disrupting house proceedings and yelling he was a prophet of god. he was taken to a local hospital where police say he is in critical condition. egypt air has set a flight from alexandria to cairo has been hijacked. according to the ri k, the plane has landed at the airport in cyprus. we will bring you more on that story throughout the morning.
belgian police trying to identify a suspect linked with two suicide bombers. released footage of the man and appealed for information about him. that is a number of people killed in last week attacks -- last week attacks rose to 35. the video -- the third bomber was released from custody yet -- eradicate radical ideology from his country. that is after a taliban suicide bomber killed more than 70 people including many women and children at a park in lahore. "must take this war to the door of terror suspects before they are able to hit." global news, 24 hours a day, powered by 2400 journalists in more than 150 news bureaus around the world. you can find more stories on the bloomberg at top . guy.
guy: thank you very much indeed. economy likely to be at the top of the agenda. yellen's address comes as the dollar -- reports shows personal spending barely increased in february. this is the number that the fed looks at you they do not have the inflation numbers they need. the backdrop and pimco saying they believe they will see -- yellen is front and center. they do see upward pressure and inflation on the horizon. i think we need to listen to janet yellen your she is the most important voice in the room. will see if she is able to snuff all of this out. really, that was we story after she gave that super dovish speech a couple of weeks back. guy: let's bring another voice into the conversation. you are focused on asset classes.
you look at the big picture stuff. she is the most important such a banker in the world. everybody is hanging on to every word. that is paying too much attention to these changes in data. it is really the longer term trend that is more instructive. both modestimes inflation in the u.s. headline inflation and core inflation is up every five years. average hours, you're starting to see wage inflation close to cpi there. after that starts to look, the economy is still moving robustly. although it is slower than we would like. try to figure out how to get the big calls right. dollar has been the story with what is been going on with oil and broad commodity story.
you look at japan equities, is that the first step? simon: it is. currency is the big market move of any class. that is key. you can see the effect it has had on japan. you have seen the yen strength hen.-- yen strength a dollar strength plateaus, that is good for lots of other things. you might see stability through the commodity set. it relieves pressure on the yen currencies. it relieves pressure on chinese outflows. i think there is positive. hans: you win the award for insulting central bankers before me saying janet yellen is the most important. i don't know how mr. draghi would feel.
i would leave that to you. normally i am the one that offends them. how we wait with the central bank -- john williams is not a voting member. how much should we wait with nonvoting members? do we somehow discount their views because they are not voting? simon: it depends on the track record of what they have said. how accurate has that been? they aren't nonvoting then they are not going to have too much effect. it is interesting to take lots of different information, but you have to decide what do you focus on, give credibility to and discount. -- i've much of your
seen a couple of headlines so we will come back. egypt air is confirming that flight ms 181 has been hijacked. we will see a statement come through shortly. let's talk to our middle east editor, elliott golf can. kine.liott got was an: wednesday and it internal flight -- we understand it was an internal flight from alexandria to cairo. the plane was hijacked and landed in cyprus. read about an hour ago. there are different reports coming out -- cyprus right about an hour ago. there are different reports coming out. saying thereorts was one hijacker. television, i
hijacked -- the hijacker has not made any demands. i spoke to an airport that said arehts heading to monica not being diverted to tel aviv, but the pilot chooses themselves were to be diverted to. there could be a number of airports around the region. in terms of the hijacked plane, it is on the tarmac. we have yet to see any demands from the hijacker himself. what is been a very worrying situation for those with loved ones and friends on board this flight. it raises more questions about egypt -- egyptian airport security. many people believe to be a shutdown and [indiscernible] tourism which is a big
guy: welcome back -- hans: welcome back to on the move. this get to the bloomberg business flash. kumutha: good morning hans. the u.s. has dropped its case against apple after successfully hacking into the iphone of one of the san bernardino terrorists . it a lot the phone with an unnamed third party. and without compromise in any data. apple says the case should've have never been brought in virgin america has said to -- -- brought. virgin america has said -- richard branson put it up for
sale according to people familiar with the matter. discussions between virgin america and the two bidders are ongoing. it could be announced as early -- a deal could be announced as early as next week. the owner of the sheridan, westin and w hotel brands says it has received a $14 billion offer for china's insurance. valued at $13 billion. that is your bloomberg's business flash. guy. guy: commodities including oil and copper at the risk of -- recent advances in improved on the metals. that is from barclays. investors rush for the exit. is going to be interesting to keep this one around. you are right and you got your timing right, you have made a
ton of money. you look at some of the ,aluation stories on oil stocks i think they are more stretched than they have ever been. simon: in the oil space, the problem is the american shale guys come in [indiscernible] it is not too far off the new marginal low production rates. is they aremic backed by debt. you have to keep paying your bonds -- you have to keep in your bonds. that has a different dynamic given that supply can come more quickly and suppress that price. hans: when you look across the globe, how we understand the differentiate -- and differentiate between the emerging markets.
what you see potential value guy: -- where do you see potential value? simon: it is more in depth than that. it is at a company level, rather than country by country. the external managers we use, for example for more opportunities in india than base, and that is in the hardware/software, not necessarily internet linked. beyond i.t., also in financials. finding opportunities there, especially in the services area. it is more specific. as we know, you can split the e.m. companies into commodity anducers and non-producers the genetic divergence they have experienced recently. guy: simon nicholas joining us.
he will stay with us. moments away from the european open. it is the battle of the charts. we will walk you through -- i've got a nice little chart from the treasuries. a lovely morning in london. that is what you want to see after a rainy easter weekend. we are going to take a break. see you in a moment. ♪
guy: we are nine minutes away from the market open. let's update you on what is happening with the egyptian airliner. and egypt aircraft has been diverted -- and egypt aircraft has been diverted to cyprus. the 81 people on board. details are very sketchy at the moment. that are some reports that the hijacker is wearing an explosive else. that is unconfirmed -- an explosive belt. that is unconfirmed. the aircraft is in cyprus. let's update you on how asian trading has been taking place.
session been a choppy to do since we have heard that news filtered through from egypt. these losses and china etc. -- these losses in china exacerbated. holding on to today's lows. this picture was brighter there. we have seen hong kong come back online for the first time since the easter break. there's been -- property stocks. a good day for korea. up.hang seng the first gain there in five sessions for korea it in japan, the nikkei 225, down by the fact that 1500 stocks traded -- dividends taking a lot of shine. a pretty terrible day in australia. 1.6%. everyone
is awaiting janet yellen's speech later. we have seen a lot of focus coming through into currencies. the offshore chinese is weak. 6.50 159. the kiwi along with the korean -- ahead of yellen's speech. guy. guy: juliette saly joining us. you into the battle of the charts. i am going to start. it is my prerogative. hans nichols can go second. i take you to this chart which is one relating to the treasury. what it is showing is we have a situation where increasingly money is being taken out by sovereign welfare -- wealth fund and being replaced in the treasury market. we do not have accurate data. the data that we saw here is
proxy that they use to determine hedge funds. we saw a sharp spike. that we about this is could see more volatility in the future. significantly more. around events like today with janet yellen speaking. hans: that is a fair point. i'm not going to preach judge -- .'m not going to prejudge this i build discharge in mind with some of his predilections. looking at individual countries and you look at these are inflows into emerging markets. these are week by week data. you see a strong trend. more money. investors are liking and showing an appetite for risk. looking at individual stocks in emerging markets. that is my attempt to flatter
you. we'll see if that cheap trick works. the decision is yours. the second chart. it has been the opposite with outflows being massive. business dollar weakness has been supportive to em currencies. it is a risk on move to start to see flows back in. and stability coming back the dollar being weak or, you have seen some em currencies respond -- being weaker, you have seen some em currencies respond. start putting some money at work, whether it is bonds followed by equities in the end. [indiscernible] tuesday morning, when for hans nichols.
guy: good morning. you are watching "on the move." alongside hans nichols. the vulnerable dollar. will yellen put the back in the cage? japan.hifts in react?l the yen the indian prime minister hits back at critics who say he got lucky with lower oil prices. hans: most futures are pointing up. nobody is about more than 1%. the dax. is getting close thes head out there to
european open. let's get to nejra cehic with the touchscreen. nejra: we sell losses with asia. asian stocks dropped for the first time in three days. with the losses in japan and china. we did see european equity futures pointing higher. we are still waiting for some of these markets to open. we will come back to that in a second. you can see the ftse 100 opened a pretty much unchanged, as well as the cac 40. we have been watching the dollar. the bloomberg dollar index had six days of gains last week, the longest run of rains in two months. f gains in twos in two months. this does largely hinge on the jobs data we will get this friday. of course, any further dollar gains will be based on expectations of a fed rate hike,
and also any other comments you might get particularly, from yellen today. wti there is down more than 1%. this is on its fifth day of decline. rent crude is down for a fourth day. we are seeing a weaker oil price we will the weekly data get on wednesday, which is expected to show that u.s. stockpiles have stayed at that record high, the highest level since 1930. let me take you back to the equity market open to see if we have seen any movement. the dax is up .6%. the cac 40 is a .7%. we are seeing this ballot in europe after the losses and asia. guy: thanks. i want to take you to the sector story and show you what is happening. you are not getting the big rotation we have seen in other sessions. the telecommunications and financials sectors are rising.
people have rotated money out of health care. they started putting money back into health care. that story looks like it is being unwound a little bit. i want to show you this chart. i have not had time to label it so i will put it on the screen for you and show you what is happening. this is easyjet at the open of trade this morning. you can see a fairly sharp spike in easyjet in the wake of what is happening. circling. is bit of a puzzler, but maybe that is just the open reaction. is: i guess the argument they are not flying to egypt anymore. maybe that is the trade people are taking on this morning. i could be totally wrong about that. hans: that is a thread the needle trade. that shows some real confidence in their strategies. let's get to the japanese prime
minister. he is holding a news conference later this morning. it comes after a slump in retail sales. figure seven at the or a fell 2.3%, more than double the forecast. was helped by the leap year's extra shopping day. this is putting more pressure on the central bank to get in more fiscal stimulus and monetary stimulus. let's get out to brian fowler in tokyo. but as the data leave us in terms of a general assessment? brian: as you said, the data today implied weak domestic demand. this is a big problem for prime minister abe. profitsknow, the record are the last couple years were supposed to start a virtuous cycle that led to more spending and more domestic investment. that is not happening.
we just finished the ways negotiations and those turned out to be quite underwhelming this time around. you can expect that consumers are going to be reluctant tos spend in the coming months. they have less money. abe is in a pretty difficult position right now. brian, can we talk about the position he finds himself in. should he, as someone is suggesting, spend the money he is getting from the windfall on high speed trains, rather than hanging onto it? icause if he hangs onto it, guess that is a kind of net negative for the economy. how much pressure is he under to spend that money? brian: that is a very good question, very timely. we actually expect mr.abe to touch on that today. the purpose of this press conference is to celebrate the passage of the budget for the
coming fiscal year, but we also to talk about expert fiscal stimulus. we think nursery spending will be a big part of it. a few weeks ago he took a lot of heat for a blog post that sparked a lot of interest. he was questioned about it in parliament, by woman who said working women in japan cannot get real jobs because there is not enough they care for their kids. so, we expect that to be a big part about what mr.abe talks about today when he talks about fiscal spending. hans: i am glad you brought up that nursery point. maybe you can helmet understand these articles. so much of the coverage in japan talks about their declining nursery and the declining demographic challenges. why is it that only now there is a discussion about added teachers for nursery schools? brian: that is a good question,. a very good question. there is no question that
especially in tokyo -- the population in tokyo keep in mind, is actually growing and the rest of the country is declining. tokyo is a unique economy unto itself. the demographics actually have an increased population and a very healthy birth rate i think in tokyo, well, relatively healthy. is there is aw push to get more people to participate in the labor force. you are running up against very long health limits in terms of day care. we have people of bloomberg -- we of women who struggle. they can't get back to work because they can't get their kids into nurseries for months and months. there is a long waiting list. it is something we all experience. guy: brian, thanks very much. brian, all mixed up in women omics. invested in japan? >> yes.
guy: why? power, ifbe came to you have understood what he wants to achieve, then it has not been an easy trade, but it has been something whereby the weakness of the yen -- that was the first start initially. you can see the market is up 100% from one he became her minister. he currently has only weakened by about 30%. there is a lot more going on and that is about the earnings growth. it is one of the few markets that has gone up so fast. compared to the u.s. certainly and europe, it looks much cheaper. it has the strongest earnings growth of any of the major developed markets. from that perspective, the fundamentals still look attractive. are thosesimon,
fundamentals attractive in japan across all sectors? break it down for us, where you see opportunities. >> it is not across all sectors. clearly, the weakness of the yen has benefited the exports. there are very many companies that are still in a zombielike stage. the opportunity in the country and finding the right external managers, as far as we are concerned, to extract rom that. guy: just a final question. let's talk about brexit. your view on this is, just extract yourself from the problem. simon: it is going to create unrest. we know the markets don't like this. having looked back at the scottish referendum, at some of
ourtrends in the markets, investors are largely sterling-based. it seems like the opportunity was to extract some of the assets from the u.k. and the sterling base. guy: where do you have your goods centered? >> mostly the u.s. and europe. guy: thanks for joining us. hans: up next, the u.k. education secretary has joined the in camp. we look at the new arguments in the run-up to britain's eu referendum. that is coming up next. ♪
guy: you are watching "on the move." let's get to bloomberg first will news. kumutha: a flight has been hijacked and been flown to an airport in cyprus. twitter thataid on it is negotiating with hijackers after the pilot was forced to ms181 whene flight the person was said to have been wearing an explosive belt. police shot a man after he pulled out a weapon at the u.s. capitol checkpoint. officials have identified him as 66-year-old from tennessee. he was previously known to force after he was arrested
disrupting tells proceedings and yelling that he was a prophet of god. he is in stable, but critical condition. the prime minister has about two eradicate ideoloes after a taliban suicide bomber killed more than 70 people, including many women and children, at a park. authorities must "take this for to the doors of terrorist outfits before they are able to hit our innocent countrymen." a day,news, 24 hours powered by our 2400 journalists and more than 150 news bureaus around the world. you can find more stories on bloomberg at top go. guy: the u.k. education sector has waded into the brexit debate. says quitting the european union could harm a future prospects.
250 business leaders, including hsbc, are ino of favor of leaving the eu. we are joined by david lee. with politics do and the conservative party. david: absolutely. it is a result of the conservative party's need. theink the need for conservative party to continually appeal to its base is what is causing this referendum. and cameron has almost a knowledged just as much. guy: are they recognizing the fact that large portions of the population are unhappy with the status quo at the moment. look at what is happening in the united states. bernie sanders is doing better
than what many anticipated. a largehere is clearly constituency of the voters within the u.k. that are quite unhappy with the eu, the media, and the u.k. is very much an outlier. yeah, there is a risk there. there is a reason why the conservative party is split on this issue. an awful lot of its members favor that. hans: if the conservative party is so divided, as you say, is there any chance that having this vote will break the fever and then they can be reunited? in some ways, it seems to me like this is the donald trump phenomenon in the states. if you think donald trump will go away at the end of this election, it seems to be a misreading of the undercurrent.
is this similar to the situation in the u.k.? david: absolutely. u.k."the "leave the campaign was defeated, it was used as a foundation to build the party and presented as almost as a victory. willnk the brexit vote very much want to continue to withthe issue around -- cameron scheduled to step down before 2020, the conservative activist base would elect the next leader of the conservative party. they will choose somebody almost certainly. hans: does it get bloodier i the june 24 election in the conservative party? am i going to have to cancel my seats in wimbledon? david: i think it could be a
little bit more delayed than that. it might take a little bit of time to wind down. or no, it is a yes, there will be a lot of movement one way or the other. guy: but if we look at the u.k., they have a huge deficit. it needs this kind of political instability to not be a permanent feature. is what you're are saying, it is going to be a political feature? david: i think the best case scenario at the moment for the post-referendum world with regards to the u.k. and the eu, is if the u.k. votes to remain in the eu.
it should go back to the state it was 10 years ago with a very large minority. investors will see that. they will realize that the referendum has not solved everybody because referendums very rarely do. this insecurity you just spoke about will remain. guy: do you think other nations, other politicians in other nations, will look at it and say, the u.k. got close, we can take it to the finishing line. or do you think they will look at it and say, the u.k. voted to stay, we are going to get back in our box. david: i don't think either of those, really. are those who will, if it is a close to feed for the brexit camp, the want to say, that's unfortunate. perhaps, vote, but we are not going to push our
country like that. it would be lovely if we can push a little bit more, but we need the u.k. to take the exposure for itself. ave confidence in their ability to get over the line, but there is an acknowledgment fo r the u.k. as a bs for the rest of the country -- as a base for the rest of the country. i think they will be other votes if the u.k. decides to leave. hans: i am trying to look for some confidence. i misspoke previously. i meant a seat, rather than a box. is there any optimism given? likelihoodink the still remains that the u.k. will vote to remain.
i think it will be quite narrow. 5% scenario is a little bit optimistic on the part of the remain camp. it has proven to be a very pragmatic organization. i think if any degree of clarity comes out of this, and to an extent even if it doesn't, they will get back to the business of governing. which is pretty much a suspended while this referendum campaign goes on. guy: david lee, thanks for stopping by. the only box at wimbledon is the royal box and if i can get you there, we will have a good day. copper about to plunge? we will look at the indications, including falling premiums on the charts. that story, up next.
china have sunk to $50 a metric ton, the lowest since november of 2012. the indicates weaker demand. it might signal that there might be fewer purchases, which means imports could drop. back at her global copper prices. according to one analyst, the drop in premiums signals the end of a buying spree. that has driven shanghai stockpiles to a record. could the impact global copper prices? hans: walkway to the supply side of the equation? a: bloomberg intelligence have been a really interesting report about this where they said that copper producers have actually been undaunted by low prices for the metal. they have actually seen to be adding 4.5 million metric tons by 2020.
assuming that these announced copper projects are actually on track for completion and ramp may exceed demand in the global market for the next five years. copper and other commodities has recovered from multi year lows it hit in january, but will that last? we have a note from barclays saying that copper may slump to the low $4000 a metric ton. $4925.we are looking at 49 is ating copper, oil risk for steep declines. he is warning that prices may tumble as people rushed for the exit. guy: fascinating.
i need to update everybody on what is happening with the aircraft, the egyptair flight that has now landed in cyprus. we are getting state tv talking about it. this is the egyptian state tv talking about it. board of themain on aircraft, but there are buses next to the aircraft. the hijacker has released 30 to 40 people on the aircraft. there were about 80 people on the aircraft. half of the people on the flight have been released. are goinging that we to be getting some live pictures from this event very shortly. european travel stocks are not reacting. easyjet is really popping to the upside. i think this has more to do with
guy: welcome back. you are watching "on the move" and we are definitely on the move this morning 30 minutes into the trading session. we're back from the easter break here in europe. european equities are trading to the upside. it really doesn't move coming through. the stock 600 is up by .8%. the cac is up over 1%. the negative legacy we actually got out of asia actually just not being represented here in europe. it will be interesting to see what the u.s. does later on. financials are trading quite strongly. people are rotating out of
the health sector this morning. here is nejra cehic. nejra: i am going to little bit against the grain here because we are seeing stocks rising, but i picked three of the decliners on the stock 600. we are starting with volkswagen. we are seeing the stock off a little after reports from dpa, citing supervisory board members. folks like an may suspend -- volkswagen may suspend its dividend. that is rising in the wake of that diesel emissions scandal. the reports of it possibly suspending its dividend payment. down 1.5% after the company said in a statement on friday that it is facing two class actions in the u.s.
this is for the eastern district of michigan, alleging anti-competitive practices in supply. faurecia trading lower on that. finally, i highlighted randgold resources. by the way,oducers, the only industry group at the moment posting losses on the stoxx 600. guy? hans: i will pick it up from here. the indian prime minister has given a strong defense of his country's economic performance. he spoke at a bloomberg event in new delhi on monday. india is one of the world's economy's brightest spots. we have low inflation, a low a high of payments, and
level of growth. we have good policy, not good fortune. hans: the speech was a rebuttal to critics who say he is gotten lucky with lwow oil prices. management representative from cross match management. i will ask you. does modi have an argument other than the oil one? >> i think he does. if you look at food inflation, which is one of the main reasons india has a very high inflation rate, which is not making room for the bank of india to cut rates -- if you look at the inflation targets that have been met, we had an inflation target of 5% in march of 2017. we are meeting that in one year in advance.
45% of the cpa is food. in 2012 and 2013, we had a very high food inflation. it was down to higher minimum support prices. so, a lot of it was policy driven. i would give him credit. there are a lot of smaller changes on the ground as well. insuranceuch as life and the general expansion of banking facilities to the people. credit, deserve a lot of i would say. the i want to take you to lamaca, where we have live pictures now. the flight was hijacked and flown to the airport in cyprus. these are live pictures. negotiations appeared to hav e been successful in part. many people have been released from the aircraft, though many still remain.
we will continue to monitor events as we see them unfold in cyprus and continue to bring those pictures. let's get back to cross bridge capital. sorry for the interruption. let's talk about what he has and has not done. the "he got lucky" argument is not the right want to focus on. people are going be able to operate in different regions. companies internally, will be able to do the same thing. he has not done this, why not? >> that is down to the politics. if you look at india, we have had for the first time, a center majority government. having said that, economically thinking, i don't think we have
a center or right thinking. everything is left. if you look at small changes -- i give you an example of the real estate bill passed one month ago. that is changing how the developers used to behave. they would go about raising prices on property. smaller changes happening on the ground. youbig ticket issue, as mention, hazmat happened and that is because of politics. guy: so, indian politics is deep. it is difficult for outsiders to fathom. we are in a position where the big event hazmat happened. will it ever happen? will indian politics continue to frustrate those who want to see this big ticket items?
>> i will say it will continue to be a challenge. but i would say that that shouldn't be an excuse to not make the small changes the government is making. the government is not waiting for it to be passed. if you look at, in a cyclical terms, we are 18 months from the biggest rally he will probably see him in market. to me, the rbi and an inflation is a big thing. if you look at inflation numbers, they are still 80 points higher. we have room to have at least three rate decisions this year. was a big, this topic. i think you will see a lot of
changes coming. ofmust have seen that 75% world bank lending happens from state owned banks. now, a lot of businesses are used to sing their bank loans being rolled ove.r -- over. the private banks are doing very well at this time. if i may say one more thing, government has made a special body. so, there are a lot of small changes happening on the ground. when need to not just look at the big changes. if you are not worried about big inflation, does that mean we don't have any upward pressure on prices from wage gr owth in rural areas and doesn't that in turn, feet into d into instability? >> i good say that if you look
at the finance commission, which has given a good supplement to government employees, i would rather have that as opposed to just inflationary changes. drought we years of had, the food price inflation is still running only at 5%. so, there is enough supply of the food, enough to cause a price rise. any increase the are talking about -- i would see that posted for consumption. so, the is going to show you that we should see that for the economy. guy: i am not going to let you go without following up on your comments on the stock market. we are 18 months away. >> i would say 18 to 24 months. i say that because there are many small changes happening on
the ground. guy: ok, fine. give me a sense of the magnitude of the rally be are talking about. 18 to 24 months away. every time hened, goes to around 7000, it is a buy. it has fallen to 6800 in the past. the market is going to play a role. businesses that start focusing. guy: we are at 76 now. where does this belly take us? -- this rally take us? >> it will easily get over that level. guy: joining us from cross bridge capital. we are going to take a break. up next, we continue to monitor
this point, and this is according to a theeswoman i think for the egyptian authorities, saying foreigners on board and the hijacker is an begich and national. details remain -- the hijacker is an egyptian national. at thisremain sketchy point. these are live pictures of people being let off the airport. some people are being taken off ft as negotiations continue. let's get you the latest on everything we know with the bloomberg business flash. saidha: virgin america is to have received takeover offers from jetblue airways and alaska air after the carrier backed by richard branson put itself up for sale. discussions between virgin america and the two bidders are
ongoing and a deal could be announced next week. the stakes have been raised again in the battle for starwood hotels. the owner of multiple hotel branches say an improved $14 billion offer from china has been offered. marriott has spent four months pursuing starwood. 250ael ganengen is among leaders backing the u.k.'s leave from the european union. support for the brexit is in contrast to the bank's current management. that is your bloomberg business flash. guy? guy: thank you very much
indeed. the u.s. government dropped its case against apple. caroline hyde is here with more. how did they do it? not give usey will any clue and that must be frustrating for apple. yesterday they said they will be dropping this case. we heard they found this so-called third-party. apple at that point, said, we want to know high you get around our encryption. it seems they have managed to do it. this will take a bit of a battering to apple's so called prowess. it seems they have a third-party that managed to break into an syede 5c used by farook, the bomber behind the san bernardino attack in california. another case involving potential encryption needs and brooklyn.
it revolves around a drug case. will they once again, be able to break into that iphone that was used? ios9.sed ios7 or hans: it seems both sides have egg on their face. one, the iphone is clearly hackable and two, the u.s. government clearly can't do it without relying on a third-party. who do you think actually won this battle? caroline: i think both can claim victory because apple was not forced to write new cod e. they did not have is that as president, which they thought would be a dangerous one. they did come out with this statement that said they were rejecting the fbi's demand from the beginning. clearly, they can claim that they did not have to write new code and they did not have to bow to the demand of the u.s.
government. but you are right, this is a bit of a pr hit. their encryption has been damaged and they will want to find out how. they say they will continue to increase the security of their products. of egg there is a lot being thrown, as you said. at one point, we had the u.s. department saying, you let the chinese government access thousands of times last year data. apple then came back and said, you asked us double the amount of times than the chinese government. both of them are trying to claim that each of them are really taking the moral lower ground overall. it interesting whether or not the u.s. government has cried wolf and will not be able to do this again. have they aggregate of the justice? releasing another head of a court say "yes, we are going to force apple to help you?"
guy: you are looking at a live shot coming from lamaca airport. this is a live shot of the egypt air i graph. -- egypt aircraft. we are looking at the latest information coming out of egypt air. we have fromeets the carrier are that negotiations with the hijacker the release ofn all th all of the passengers, except for the crew and five foreigners. the airport has now been shut down as we await for the ongoing negotiations to hopefully, result in a safe outcome for everybody. we will continue to monitor events and bring you the details. hans: guy, thanks for the update. here are the highlights for your bank holiday shortened week.
we will be watching this for clues as janet yellen addresses the economic club of new york tomorrow. thursday, we see eurozone inflation and german unemployment data, followed by u.s. initial jobless claims. japan before have the big, one, non pharm payrolls. we don't have to wait now for bloomberg's first word fx strategist, richard jones. hourrd, at some on godly of the morning we were talking about how janet yellen needs to renew her dovish stance. will this lead to the markets thinking the doves are once again in control? richard: that is the interesting thing. will she repeated the line that she did when she testified to congress earlier in february?
or does she echo the sentiments coming out of other members of the fed we have heard over the past week. they are talking in a more hawkish tone. that will be the interesting thing for me. does she resume her dovish tone she had in february, or does she echoed what her colleagues have been saying recently? doveish,she does go does she need to double down on the dovishness? think, given what we have heard from some of her colleagues lately, i think if she just repeats what she said in february, that will probably be dovish enough for markets. i think you will probably see everybody waiting for the payroll number on friday. as long as she is not too hawkish, you will the price action continued. are you ignoring stanley
fischer? that is what the market is going with here. yellen his dovish enough and a sticking with the dovish wing of tghhe fomc. if that is the case, i can't exhaust stanley fischer. can exhaust stanley fischer . richard: it depends what the data does, guy. that is what is driving things. the dovish wing of the fed now, including chair yellen, is waiting for the day, in terms of the internal debate. i think the fact that the dovish wing has started to dominate since the turn of the year is something the data will have to dissuade them from taking that pact. already some hawkish members of the fomc who say we need rate hikes inn
april. i think the dovish side of the fed will overrule them. guy: the yen has been on a losing streak lately. walk me through the yen trade. richard: it is one of those things where central bankers around the world -- and in japan as well -- are lamenting the fact that they are not getting help on the fiscal side. if we do get something that is fiscal stimulus, i think it probably suits the japanese authorities. i think the yen will weaken from their. -- from there. guy: stay with bloomberg television. we continue to monitor events as they happen in lamaca, cyprus. i am talking about the time difference and we will talk a little bit next about what is