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tv   Bloomberg Markets Americas  Bloomberg  November 7, 2016 12:00pm-3:31pm EST

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david: from our world headquarters in new york, straight from london to washington and hong kong in this hour, one day left until election day in america. hillary clinton leading donald trump by 3% in the national poll. don't worry if the stock market goes crazy. it says nothing about annual returns. what should investors think about in financials come wednesday morning? here we are, 12 hours away from election day. vonnie: but who's counting? [laughter] >> we are in positive territory today. from nine straight sessions of decline, this is the best day for the major averages, going back to march 1. definitely seeing a relief rally
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today after the announcement i fbi director james comey. that there would not be any charges associated with the e-mail server investigation. as david pointed out, hillary clinton has kept her lead in the polls. the imf, for example, which looks at the various industry groups outside the s&p 500, you won't find any read on the wheel today at the moment. we are seeing a broad-based rally. increased bond yields today. health care shares performing quite well. i wanted to dig into that, a little bit. one of the best performing stocks on the s&p today is biogen. it's gaining after the company said that their drug helped a wider group of patients with a deadly muscle disease in a late stage study. it showed success in a smaller group of patients, now a wider group.
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stocks from both companies are rising. iona, up 20%. there are indications from the election. we are seeing the hospital related specialty care providers up today in universal health services. benefiting from continual care act subsidies, lcs financial credit suites making comments to that effect. you don't only want to watch these today. watch them tomorrow, wednesday, and going forward based on what could happen with the aca. health care shares rallying, volatility coming down to some extent. this is a spread between my -- between one month implied volatility. spiking on friday since its highest -- to its highest since the u.k. vote for brexit. coming down to some extent today, seeing a few of these
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hedges being taken down off the market. we are seeing a broad stock rally, with risk assets rallying generally and people keeping some of these hedges in place against the possible outcomes on tuesday. vonnie: julie hyman, thank you for that. now let's check in on the bloomberg first word news. market: it is the final day of the presidential campaign -- mark: it is the final day of the presidential campaign. beginning in sarasota, going to pennsylvania and michigan before finishing with a late-night rally in grand rapids. starting in pennsylvania, then michigan, finally north carolina. she will be joined by her husband bill in north carolina, obamal as by president and mrs. obama.
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the justice department says it more than 500 staffers to 28 states on election day to monitor the polls. that's 35 less than four years ago. personnel will be sent to 37 jurisdictions to watch for attentional civil rights violations. curtailed by a 2013 supreme court opinion that got it a key provision of the voting rights act. new jersey governor chris christie is controvert -- contradicting the testimony of two former aides that were convicted last week in the george washington bridge lane closing scandal. in an interview this morning with charlie rose, governor christie insisted he had no recollection of being informed of the events as they happened and he questioned the logic of those involved. >> one of the most abjectly stupid things i have ever seen.
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think about it. you know me. at thisty good political game. i'm up by 25 points in a blue state. i decide that i going to create a traffic jam in a town that the democrat town that i need to win? his aides were convicted of creating traffic chaos at the gym to punish a local mayor who refused to endorse chris christie's 2013 reelection bid. marissa may insists that brexit judgese obstructed by are lawmakers. saying that while others may see to limit negotiations, the government will get on with delivering the decision of the british people. these are her first public remarks since the ruling that parliament should start in on negotiations with the european union. news, 20 four hours per day, powered by 2600 journalists .nd analysts in 120 countries
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i mark crumpton. this is bloomberg. vonnie: thanks. this is the final day of campaigning for both hillary clinton and donald trump. pennsylvania, florida, new hampshire, michigan among the final states being visited by the candidates. bloomberg now is our politics are corner, steven yaccino. when the electoral college doesn't win the popular vote, what does -- what happens it'sion mark steve: important to note that this is not a national election, right? it's state-by-state. she still has a much bigger advantage over donald trump when it comes to the electoral college. , to yourells us question, is that no matter what, no matter who wins, this country is divided.
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this country is distrustful and upset. the scenario that you survive -- described would only further exacerbate that. even if that didn't happen, we know a majority of people that we polled want to accept the outcome no matter what. they will keep fighting the matter who wins. they don't see either of these candidates as representing them. this is a serious governing chant -- challenge for whoever wins. this is an ambitious travel schedule. yesterday the news broke at 3:30 , the fbi saying that their conclusion about hillary clinton's e-mails are no different from the conclusion in july. are they talking about that? steve: they are. it's time for everyone to gang up on the fbi. the clinton campaign came out after they made the announcement and were very critical. .emocrats ganging up on comey
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saying that they were never worried, they always knew that this would be the outcome. republicans at the same time are saying -- raising questions about whether or not the fbi could have been given -- doing a diligent scrub of those e-mails to figure out what was in them. they said that to be fair, only e-mails sent to and from hillary clinton -- they didn't go through all of them. left in theay election. we are still talking about this. environment of what the whole race has been. people turning up their nose a bit. it's going to be tough going forward, no matter what. vonnie: what are the odds that we don't hear of concession speech -- you're a concession speech tomorrow night? trump, we don't know the odds. whether he does it in his concession speech or refuses -- vonnie: would hillary give one? steve: i believe that she would,
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if that was the outcome. i think that donald trump probably will. the question is whether or not it will be a concession speech or if you will use that opportunity to redirect the message he's been spreading on the campaign trail. bloomberg politics reporter, steven yaccino. night, the election, no one will be getting any sleep for the next few days. david: counseling caution, all of forensic -- oliver renick. he joins us now to explain his take on this. looking back at the referendum vote and the way that markets reacted then, you are wondering what's going to happen. why are markets -- why should they not be as worried? oliver: history shows us that there's no connection between the day after the election and what happens in the next year.
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the long-term portfolio manager -- you alwayss talk to these guys, it's always -- stay bullish, short-term moves. but it's very true. even though talking about one day sets a precedent for a long-term move and that sounds ridiculous, this is what people trade on and there are a lot of folks out there who are going to look at this and try to project out. january, we talk about the january effect for small caps. let's talk about the santa claus rally in december. it's all sort of idiosyncratic in the market from time to time. it shows that people pay attention to the short-term moves, extrapolating on what it could mean. it's oftentimes a flawed process. what about stocks?
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oliver: the volume of the situation is interesting. there's been a fair amount of swinging back and forth in the market. volume picking up quite a bit. it's been very dependent on these big announcements. everyone is keying into politics right now. it's higher, then it slows down when there is a earth of information. -- a dearth of information. we come in,morning, stocks are up around the world and it's this very risk on atmosphere. it's the question of how much of a relief rally will be in the market. bloomberg politics polls are out this morning. today, it seems like a consensus trade giving you room to bounce as a result. david: ok, steps in line with what the polling is showing, just a little bit of a difference there between clinton and trump.
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to what degree has the market priced in clinton's history? oliver: hard to say. you have to try to think about what's going to happen in the market based on the instances in which there has been this clear market move. for example, sunday night, obviously a 2% move and we've gone back to look at the debate in which trump started losing some ground. you can try to project that out, but there is not a lot of mathematical grounding to say that we moved to percent today and if trump wins, we will move expert percent. -- x percent. looking at how it's going to affect the economy at the end of the day, probably write on screen. whether or not it oils down to sectors, in the long term that's a reasonable thing to expect. we've looked at what the sectors should game. care, industrials,
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whether there will be fiscal spending, but in the short term i think it will be across the board a kind of selling. it won't be like -- if trump wins, let's go buy stuff. it's just going to be a lot of red. david: thank you. vonnie: coming up, october was a big month. what does that tell you about ceo confidence wes and mark the greenhill ceo, next. this is bloomberg. ♪
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♪ vonnie: this is "bloomberg markets." i'm vonnie quinn. david: every monday week zoom in on the m&a business with analysis from the players behind the deals. we look at a record-breaking
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month for m&a, the highest volume in dollar value ever. jeff mccracken, executive editor from global out -- global m&a at , whoberg, and scott bok worked on the save a lot deal and metal nine. jeff, take it away. jeff: yes, we have scott here. it's been an interesting month. people,iewed a lot of the month leading up to the election might slow down. people might be concerned that this is a volatile situation, but obviously they were wrong. turned out to be a record-breaking month. do people just assume they already know the outcome? why did we have such a crazy there's the: element of various deals coming together at once. about a month ago business people got a general sense of how the election was going to come out. clinton in the white house and the republicans in at least one
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house. i think that part of the flurry of deals that we saw with our firm as well, came from confidence that it was all going to work out ok. scott: what's your position -- jeff: what's your position, if you will? how's it going to play out tomorrow? scott: the conventional wisdom now, and it has been this year for some time, the clinton would win the white house. republicans would win the white house and the senate -- republicans would win the senate. it's what everybody wants. it's the status quo. everybody knows clinton and her policies. they may not be huge fans, but it is the status quo in terms of what business really needs. jeff: we have had eight days in a row of down markets, and today after the second comey letter, ceos and investors are hoping and expecting hillary to be the victor tomorrow. scott: exactly.
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they hate uncertainty. there's a lot of uncertainty around trump and what his might be.roblems it's given the all clear signal here during the markets today. will see a lot of m&a activity going forward. jeff: how do you think this impacts the regulatory landscape. -- landscape? the at&t and t-mobile deal that got blocked a few years ago. how do you think that the hillary or trump administration will block the landscape? scott: the largest deals, from the 10's to the $50 million deals, will be risky. not just in terms of some economic calculus. but just in terms of just politics. quickly you saw the at&t deal that we spoke about, negative for trump and clinton, it's a
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part of our political system right now. number one by number two, it's an atypical deal. at&t is venturing outside of its normal area by buying time warner. scott: correct. but you are right, a classic review would have been no problem in the deal whatsoever. go through.uld but with politics? who knows. this for a been doing a few years. we talked about the u.s. and how it became yet again the dominant place in m&a. the u.s. and europe are closer, if you will, then today. what's happened in europe, in the u.s., to make it so that's the act -- outcome? scott: the european market is about as big as the u.s. market. what's interesting is if you 90'sat peak periods in the
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, 2000's, there's more activity. it's during this more turbulent time, when people appear to be worried about things, when the europeans seem to just fall back and put things on hold, where in america it seems we have a bit of a culture investor mentality. even the healthiest companies, if there is uncertainty, maybe this is my moment to do something big and strategic. you see more of that here than in europe. last week american axle spent about 1.6 million dollars purchasing a company a thing called metal nine. as to what it means going into next year, you mentioned industrials. generally speaking, it's been slower this year. quite they don't get headlines. you don't read or hear quite as much about it on bloomberg or in other publications.
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emerson recently in a $4 million deal, we had done three acquisitions for all, that had culminated in a separation of that company into two pieces. that market has struggled with low growth. i think they will keep on consolidating. it's not the big, flashy deals. it's just grinding out consolidation in individual sectors. jeff: lack of growth is only going to encourage these kinds of deals, whether we talk about these companies growing in asset or in acquisition. anticipate these big deals? there was a lot of news this year about honeywell or et ask, doing deals that didn't happen. , doing deals that didn't happen. scott: i think the market, sort vast forvironment is environmental transactions. there's some degree of growth,
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but not that much. i think it's good enough that the businesses are in reasonably good shape. but not good enough that you could get much growth on the top or bottom line without consolidation. year you see ar lot of tech m&a, health care m&a . not as much in the industrial space. some of that might be the nature of those businesses. i sometimes wonder about the culture, if you will. the people that run companies in the midwest being just more cautious and not wanting to take rate risks. is that fair? i think there's an element of that. i grew up in michigan. a battleground state. they want to do things that are right down the middle. that are not some grand strategy , but across the middle of the plate in terms of their sector and not being too risky for the balance sheet. that leads to deals like one billion, 2 billion, 3 billion. i think in cincinnati,
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detroit, wisconsin, the ceo's that exist in those areas are just cautious. they don't want to risk the farm , if you will, betting the company on a big deal. you'll want to see a lot of them putting themselves on the block. correct.at's the industries haven't changed that much. if you look at places like telecom or media, this venture medic change and that has caused a lot of the big picture transactions and industrials. jeff: appreciate your time, scott. scott: thank you. jeff: back to you, david. vonnie: i will take it, jeff. jeff mccracken and scott bok, ceo of greenhill. david: watch tomorrow night for coverage of the presidential election, kicking off at 7 p.m. we will have what it means for the markets in particular. markets are higher, the
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dow is up 1.9%. 340 points, the s&p 500 being led by health care, among other sectors. 2.1%, a rally as well for the composite index. the vix, 8.168, down from the friday index, higher than the basket of currencies. the yen is one of the currencies that's weakening right now. but of course, it had strengthened quite substantially. keeping an eye on the mexican 2%, dollaris down wise. to 18.64.ing taking a look at the lira, weakening by another 6/10. on in thethings going world as well. china, for example, with a reserve decline and the offshore
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yuan at 6.921 right now. the weakest it's been. james comey said that he was going to stick with the conclusions he made in july. let's get more from julie. are talking about, we are seeing this rally today, the largest since march 1. saidi director james comey , he was not going to bring any charges in the personal e-mail server investigation of hillary clinton and her staff. at least not at the moment. we are seeing this relief rally in the wake of the declines we've been seeing. if you look at the bloomberg and the 10 day, or nine day, i should say, slide we have had in the s&p 500, i'm looking at the 10 day chart here. you saw that slide and the bounce we are seeing today, down 1% in that. of time.
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that period of time. the bounce, bringing us back to some extent. taking a look at the big movers on an index basis, microsoft, jpmorgan, exxon mobil, because of the size they are contributing individually the biggest to the game. finally, some of the things that we were getting during that time are falling today. the dollar, gaining against the japanese yen. gold as well. vonnie: julie hyman at the markets desk, thank you. coming up, we've got financials with l forar partners. this is bloomberg. ♪ capital alpha partners. this is bloomberg. ♪
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david: live, from bloomberg world headquarters in new york, i'm david gura. vonnie: and i'm vonnie quinn.
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let's start out with headlines this morning. mark crumpton has more. mark: donald trump plans to keep up a break that campaign pace through election day. florida, north carolina, pennsylvania, michigan, and new hampshire. hillary clinton is also going full force, she will be joined by her husband, president obama, and the first lady. she will also be campaigning in grand rapids, michigan, pittsburgh, and raleigh, north carolina. janet we know died earlier today frommplications parkinson's disease. we know, nominated by president bill clinton, sharply criticized in her first year for ordering the deadly raid on the branch davidian compound in waco, texas . she also got involved in some of the clinton administration's other controversies, including whitewater, the monica lewinsky scandal, and authorizing the return to cuba of young elian gonzalez.
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she was 78 years old. into, forcesraq trying to clear the islamic state from neighborhoods in most all. because so many are staying in their homes, the iraqis cannot rely on airstrikes for the coalition. the islamic state has held muscle for over two years. that twoly ruling independent activists elected to the hong kong legislature can hold office with thousands of demonstrators holding the highest court to protest the move. it could break international confidence in hong kong. news, 24 hours per day, powered by 2600 journalists and analysts in 120 countries. i'm mark crumpton, this is bloomberg. vonnie? vonnie: thanks. another quick look at u.s. stocks and how they are
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performing. cisco, up 10%, you can see the s&p is up 2.1 percent there. the dow is up 1.9 percent. it points on the gain, but was below 18,000 obviously on friday after a string of declines. the nasdaq is up 2.4% now from where it is now, 61 to 64. let's open it up to abigail doolittle, who has more. abigail: it certainly is a risk on day. docs are clearly -- clearly in trading beingice inversely yield, nine days in a row with lots of investor jitters. some investors have been comparing or wondering if the upcoming election could in fact bring a brexit type selloff. some well-known investors we are talking about? selloff,n, pullback,
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typically announced and take most investors by surprise. it will be interesting to take a look at the s&p 500 and the 10 year yield, with stocks and bonds into the s&p and the election to see if there are any similarities. going to bloomberg, we take a with 30 days4820, of trading into the election and the brexit. there's a nice uptrend until the big selloff that caused the s&p 500 to slide bearish late below the 200 -- bearishly below the moving average. good -- moving into the election over the last a few days, we have seen a downtrend and just last friday the index bounced off the moving average. suggesting that we were caught offguard for the exit, but have been -- brexit, but have been preparing for more risk around the election, perhaps suggesting
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that we will continue to see some sort of relief rally. when we cross asset class with 4821.and 10 year yields, once again on the bottom we have the brexit. the 10 year yield the climbing into the event, for the most part, where the investors are looking for safety. a modest rally off of that, but what gets interesting is on top, the election. you can see the 10 year yields climbing higher. bonds have been selling off into the election. investors right now are more and perhapshe fed the fed action later this year, if they do raise rates in december, could be a bigger influence on the market overall. vonnie: abigail doolittle, thanks for that. david: investor anxiety mounting over the outcome of the election. this after a nine day climb in
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the vix on friday. joining us now with four things that investors in financial should think about right now is the capital alpha partner, ian katz, joining us from washington, d.c. looking at lake who -- who might home the treasury department, who are the names being floated? why will that be so important in the near term? think theury, i favorite is lyle brainard, who used to be a treasury under the secretary for national affairs and is now a fed board governor , goingold clintonite back to being an economic advisor at the white house during the bill clinton era. the clintons well. her resume is impressive. i think that most people would see her as moderate. she is not an elizabeth moran type progressive. she is somewhere down the
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middle. beenf the things i've telling folks is that we think the fcc is going to be very important. the fcc is working on rules for asset managers. it sets a tone for enforcement on wall street. we think that they do have a favorite if clinton wins. but it's not a shoe in. ginsburg has a shot at that position. treasury, i would say he's the favorite for either one. the fcc is the one we think folks should be looking out for. tell us where the decisions need to be made. fcc, changes at the sec -- how long before we start to see trickle-down in the economy? could take a while. with the fcc, it could be more immediate. you might see rulemaking for the
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asset managers that could take effect over the next year or so. the treasury is a little bit different, because it is essentially an arm of the executive branch that goes out and supports the white house on economic policy. it's a little bit different in nature. it's not a regulator, per se. it tends to coordinate the work of the other regulators. there the effects might be more gradual, but i think you will see some rules being done pretty quickly. keep in mind that the regulators .an more or less do their thing whereas in congress there is this huge divide, huge discord between the parties. there's a real chance that not much gets done over the next several months in congress. there's going to be a lot of bitterness when this is all done. but the regulators can do their thing. david: a minute ago you brought up senator warren. i wonder one -- what other names you might be thinking about? you hillary clinton, if she becomes president, senator warren says she is vehemently
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opposed to those who have had experience in the financial sector beforehand. what role in she going to play and how will that complicate things? ian: our thinking is that elizabeth warren will be very influential. particularly at the sec and at the cfp be, which is her -- cfp b, her baby. hillarythink that clinton will just lie down and do whatever elizabeth warren wants. she will center around on some issues. be a favoriteot of elizabeth warren, but i don't think that that alone will stop hillary clinton from choosing brainard if she wants her. to the federal reserve board of governors, daniel true low -- daniel true low --
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trillo,, what might happen with that? ian: of course, we don't know, it's tough to predict, but trillo has been in the job for a while. he has been the regulatory czar. he is somewhere around 80%, 90% done with the work that has been on his plate to do with regulation. he's pretty close. for that reason we think he's likely to step down next year. president, the next could choose the vice chair of supervision. the obama administration has not picked anyone for that job. it, the fact of, for years now. if he steps down it would give an opportunity for clinton to pick someone for that job that would loosen up -- there are a couple of fed nominees that have
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been held up. to see that pic done by the administration. is filled byion the clinton administration, presumably those two fed nominees could go through the senate and we could sort of see a package deal by the fed next year. you areounds like working under the assumption that hillary clinton is going to win the presidency, seems to be that is what you are thinking. if donald trump are to win, what about his takes? vonnie: it gets tougher -- ian: it gets tougher there. there is less known about trumps views and they tend to be harder to predict. that's probably an understatement. that his finance , hisman, steve nation campaign has put out word that he would be a likely trip --
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likely pick for treasury secretary. about the sec and other positions. if he were to win tomorrow, there would be a lot of scrambling. i would expect that some of it might even be done by the trump people. i'm not sure that they have it all lined up. all right, ian katz, thank you. a reminder to tune into bloomberg for complete election coverage tomorrow night. we will be joined by david gura. inid: happening now pittsburgh, hillary clinton is speaking at a campaign rally there. hillary clinton returning to pittsburgh for the second time in just a few days. there in and over right now. right now.r
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you can catch them both now on bloomberg.com. this is bloomberg. ♪
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welcome back to bloomberg world headquarters, in new york. i'm david gura. vonnie: and i'm vonnie quinn. alan greenspan has seen his share of change during his career. he joined in this morning and we asked him how the fed could function in this political environment. by statute and buy history, the federal reserve is
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politically independent in the system. the system has managed to function fairly effectively throughout a number of similar circumstances that we are going through today. theboard of governors and chairperson, what they do at this stage is they have all happened historically. it's been disregarded. when i was at the fed as , i received a huge lower of requests to interest rates. not a single one to raise them. , if yout is clearly take what the politics are telling you, that is not the way to run a financial system. so, i think they just have to disregard this stuff.
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>> what's so interesting about this global populist movement is that this situation is not unique to the u.s. we have seen it here and in the u.k.. is it surprising to you that we are having a conversation about the independence of central banks? troubling, somewhat that the whole interest of what central banks do and what the economy is going to do is -- has , it'sdamentally changed very hard to forecast what's going to happen. know what the fed has to do. that is nothing. danger ins there a that? in this sense -- there seems to between the chasm elites in the economic world and the people who feel disenfranchised. this is not just the united
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states, this is europe as well. at some point the fed does need political support, in a sense. otherwise we will have curtailment of international trade with other factors exonerating what the fed is trying to nurture. the: it's not the job of fed to put a position where we would like it to be. leadersto the political of the country. the fed cannot compromise based on the principles or function of the central bank will disappear. if there is a concern, and indeed there should be, it's not the job of the federal reserve to change it. it's the job of the senior political force, from the president on down, to act accordingly. when i, for 18.5 years at the fed, that's essentially what the issue is about and i think it worked fairly well.
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current fed chair is asked to serve another term, the usually duck out early. if donald trump asks janet yellen to serve another term, do you think she will stick it out to prove the point you are making? alan: i think it's up to the individual. all, i don't like to discuss hypothetical issues when we don't know what the facts are. -- when we will know what the facts are very shortly. govern.ciple is to those are very clearly, unambiguously, independent disregard thethat letters i used to get. a other words, if you took vote by the populace as to how should function,
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everyone would be in favor of printing more money. >> one important principle is the independence of the central bank. another is the benefits for everyone. from global -- globalization to free trade. where has the failure been, in showing those benefits to the people at the bottom of the chain? that's basically the political system. it's not the job of the federal reserve to enunciate economic principles. it's the job of the president, whoress, and all of those specifically are oriented towards finance to do it. of thenot the job federal reserve. it's the job of the federal reserve to explain how markets work. to explain how free-trade is a lobby itt it does not
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from those particular plans. vonnie: that was alan greenspan, from this morning. david: tune in for complete coverage, starting tomorrow night at 7 p.m. eastern, the election. ♪
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this is "bloomberg markets," i'm vonnie quinn. david: i'm david gura. this is your global business report. the german economy might have hit a soft patch. plus we get a peek at ferrari earnings. gold lost its luster? we examine the metal today. and,ing with chairman
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numbers unexpectedly falling in september, confirming that the economy went through a soft patch in the third quarter. manufacturing has picked up and companies have boosted hiring. the top new york official says he's boosting compliance efforts after a crackdown on illicit money moves. they are facing a $250 million penalty from new york regulators. state officials have pursued foreign banks over violations in anti-money laundering controls, yet it's unusual to levy a penalty like that against a china controlled lender. three earnings beat estimates at the super car from fiat chrysler at the start of the year. widen the dealto with models that have wider engines. it is time now for our bloomberg's quick take.
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for today's investor, it seems gold has lost much of its allure. , is it just as drop or is it a change in human appetite? it demonstrated again, first of all, through tightening in the u.s. presidential race. gold is down 25%. ed equityil rock markets. the gold record high of $1921.17 came in 2011 as the economy struggled in the wake of the financial crisis. looking at the threat of faster inflation and weaker currencies, expanding the money slide by buying bonds. late markets rallied in 2012, investments began to tumble in the background. in dollar has pegged gold
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1970, rising to $850 per ounce in the 1980's. prices slumped in the following two decades around the world to shrinking reserves. the financial crisis center the metal higher in 2008. sent the metal higher in 2008. more than any other investment, it acted as a neck a chamber for economic growth and fears with guesses about what the central bankers are thinking. they say there is fewer reasons to own it now because central banks have engineered an economic recovery without sparking hyperinflation. with what it's worth in the arsenal of investments, growth is far from certain, limiting gains and interest rates. investors who fear another as soon asgold
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possible. for more, head to bloomberg.com for more stories. david: coming up in the next hour, tina fordham joins us from london to tell us about the election result impact on the global stage. this is bloomberg. ♪
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david: it's 2:00 a.m. in hong kong. good afternoon, i david gura. and i'm vonnie quinn. welcome to "bloomberg markets."
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♪ from bloomberg world headquarters in new york, we're covering stories from toronto to washington and london this hour. in tel aviv as well. less than 24 hours until americans had to the polls. we speak to citigroup's chief political analyst on what the u.s. election means for the rest of the world. alan greenspan weighs in on what this u.s. election means and coming days. and next week's shares are soaring after shareholders endorsed oracle's bid over the weekend. that's for a $9 billion acquisition. halfway into the trading day, i'm sure those shares are moving. julie hyman is here with the latest. julie: i want to look at the math of what's going on in the united states in terms of asset
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classes. , the country market monitor. over here we have equities and broadly in the green. thebrighter the green, greater the standard deviation away from the typical move that we see. -- brighty green green. unusual moves we are seeing in stock markets today with all three major averages in the u.s. rising by the most since march 1, which was tuesday in the primary season. as we see this bounce for the nine day moving -- losing streak for the markets. this column is currencies and all of these are currencies that are falling versus the u.s. dollar. most notable is the one at the top, the japanese yen, which has been a flight to safety trade in recent days. that's getting flipped on its head today. also, some bounceback and commodities. crude oil rising after an earthquake in oklahoma. there's a concern that may have affected supplies, especially in cushing. over here, we're seeing rates
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the red because the standard deviation is not as large. we are seeing losses in the price and an increase in rates. selling in treasuries is what we are seeing today. in terms of individual stock movements, at last check, only 14 stocks in the s&p 500 were down today. those that were contributing individually the most to gains include microsoft and amazon within technology. there's a big lift intact today. financialsother arrived with rates today and i mobile getting a bounce along with oil prices. i also wanted to take a look at volatility, which we have been talking so much about recently. this is the vix on the top and -- vvix, the volatility. they've come down today, they are still well above the five-year averages. there's the aligns on these two charts, for the vix we're talking about 18.9.
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elevated, thisy volatility reflects that even though we are seeing a risk on sort of rally today, there are still some headings going on and some trepidation about the outcome of the election. that: julie hyman with market update. let's check in on bloomberg first word news this afternoon. mark richt and has more. clinton enters the last day of the president of campaign after getting good news from the fbi. director james comey told congress the agency is sticking by the finding than clinton did not commit a crime in her handling of e-mails the secretary of state. on october 28, comey told lawmakers the fbi was examining new e-mails possibly linked to the investigation. republican nominee donald trump denounced the move, he says clinton is being protected by a rigged system. the final bloomberg politics poll of the campaign shows tonton as a narrow lead, 41%
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44%, in a race involving third-party candidates. white house press secretary joss artist president obama continues to have confidence in director comey and views him as a man of integrity, a man of character. his comments came a day after comey sent that letter to congress about secretary clinton's e-mails, saying the view was compled and the bureau was standing by its recommendation that no charges be filed. jury selection has been postponed until tomorrow in the federal case of a white man charged with the fatal shootings of nine black parishioners at a charleston, south carolina church in june of 2015. the judge said he had a request from the lawyers for 22-year-old that had- dylan roof his right to a fair and impartial trial. --me mister none yahoo! says prime minister netanyahu says they will not attend colleges with palestinians. he has called on the palestinian
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president to meet for talks and he has refused unless israel conducts a prisoner release that netanyahu canceled. global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. vonnie: mark, thank you. after tomorrow, we should know who the next president of the states will be. joining us to discuss ahead of the november 8 vote is tina fordham. tina joins us from london. one of the things you say if this is still a back run front raise. you never see one coming, but how likely is it that we get the thing like this?
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tina: we have to focus on election day and the kind of things they can develop. it's quite possible that we don't get a result in time for the market open, certainly in asia, possibly in london, maybe even in new york. if there needs to be a recount in any state. that's the most benign outcome. and it would need to be quite a close vote in a swing state i think for that to transpire. -- threatshad threat of terror attacks. the fbi announcement may be temporarily has taken one thing off the table, between the possibility of electoral irregularities and the possibility of a terrorist attack in the possibility of even foreign intervention, which the fbi's investigating, we have three big wildcards, if not black swans. you may not change the outcome, but it may mean extensive uncertainty. have we heard the last squawk from the black swan that is hillary clinton's e-mail scandal? ms. fordham: a friend of mine
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uses the term as brown ugly duckling is little baby black swans. i don't think we have heard the last squawk, to carry that metaphor too far. i think we have a stay of execution for the swan, because i understand, and i think it's an obvious point, that the probably alsoase contain content that is likely to be the subject of future investigations. however, that is different from the potential for impeachment risk, which of course, depends very much on how the congressional control goes, whether it is divided or a republican-controlled congress. vonnie: you think there is still the risk of an impeachment? i think it's a non-negligible risk, especially filler hillary clinton presides over republican controlled congress. the fbi still investigating the clinton global initiative. vonnie: what is your base case? we downgraded the
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probability of a hillary clinton victory to 60%. still the base case. hillary clinton in the white house and a divided congress. a lot is going to depend on the so-called down ticket voting and that depends on turnout. one of the interesting points has been just how many people have come out for early voting. which maybe just as how much americans want to get this all over with. david: we was picking with oliver renick about the difficulty of a market price with the clinton victory. we do say they have? been theam: that's base case, which is why we saw the selloff on friday with the first announcement from comey. and then there's the relief rally that we saw today. markets are having a lot of trouble pricing this election in the first place. let's also remember what kind of trading sessions we normally get after a u.s. president election. two days a real volatility following obama's victory, but
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in the s&p went on to some of its best years ever. vonnie: how do emerging markets perform? we don't want them into one basket anymore, but the peso has been a big mover, the korean you on has been watching this election very carefully. and even as like the euro and the frank, the rest of the world. ms. fordham: in a sense, i think europe gets hit quite hard by what happens in the u.s. elections, but in different ways. given, for example, european reliance on the u.s. for security and defense considerations. under a donald trump presidency and changes in nato, that might be a considerable issue. for emerging markets, we talking about latin america and mexico and the prospect that nafta is torn up, donald trump has been clear about that. i do think free-trade and additional trade agreements under other presidents or presidential scenarios are very limited.
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and we don't see trade deals being proved in the lame-duck either. we really talking about the mexican peso is a proxy for a trump presidency and that prospect seems to have diminished for now. although, a 40% probability is more than a tale risk. there is a plausible path for donald trump to become president. david: that is through the electoral college system, reports for many months were that hillary clinton her campaign and faye the closest attention to figuring out that calculus and donald trump had not. it's a campaign that's been fueled by a lot of populism. how do you expect that to play out? what is the legacy of the campaign going to be when you look at the electoral college? ms. fordham: i'm cautious about making this kind of forecast myself and rely upon the people who have teams of number crunchers. why look at the projections of the moment for the electoral college, i see an awful lot of states that are within the margin of error, at 3% to 5% in polls.
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to me, that's very close. i can call on whether they lean republican or democrat are also based on turnout projections and what we can see so far in early voting, although that's not a perfect indicator is that the constituencies coming out to vote for hillary clinton look different than for barack obama and with that ultimately means is waiting those variables for pollsters becomes very difficult. i think we take the current projections in the electoral college with a real grain of salt. vonnie: governance in the united states for the next four years, what does it look like? ms. fordham: it looks pretty crummy, i think. this is one of the things that we have warned of, that the advanced economies, you know i also covered brexit, we had a busy week with brexit last week also, are starting to look very difficult to govern, where margins of victory are very narrow, where polarization is high, in the u.s., we election every two years, for
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republicans, if they lose the white house this time, will be positioning to hammer democrats in the 2018 midterms. how do they go about doing that? do you have another debt ceiling showdown in march? probably. we're hearing obduracy statements from members of congress like chuck schumer about areas where in principle, there are shared desires to make progress like infrastructure and corporate tax. i think the reality is going to be much more trying. david: we talk about brings it in just a minute, tina fordham will stay with us. tune in tomorrow night at 7:00 p.m. for complete election coverage starting at 7:00 p.m. wall street time with me and megan murphy, the washington bureau chief. this is bloomberg. ♪
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vonnie: this is "bloomberg markets," i'm vonnie quinn. david: i am david gura. david davis was pressed by lawmakers to produce new details on the uk's stance for leaving the european union. >> the point of no return was passed on june 23. implement the decision to leave the means following the right processes. we mustered -- we must leave in the way agreed to by law, which means following article 50 in the treaty for the european union. vonnie: we're back with --david: we're back with tina fordham. to the point of no return change up to court decision in london? ms. fordham: it didn't go into reverse, but it probably slowed down quite a bit. vonnie: that's a good answer. i guess the sentiment of the
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question is, is it possible for this thing to be stopped or no? ms. fordham: we don't see breversal as a likely phenomenon. there's very little support for it in the first place. while i think investors jumped the gun a little bit by thinking that the decision from the high court in the u.k. on triggering article 50 and involving parliament might mean that it would never happen, we think is it delays the prospect of withdrawing, it also exit that much harder for premise or may and david davis and the others to formulate a strategy, because now they got to run it past parliament. david: what happens before this goes to the supreme court, in terms of what operating in this blog go back in? -- this political vacuum? ms. fordham: there's not a lot that part of -- that parliament can do.
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they are signaling what they want, and that's what this really matters. you have two thirds of mps in the british parliament who are pro-remain and/or represent pro-remain constituencies. they are think are very unlikely to block triggering article 50, but what they are going to do is put pressure on the government to avoid what's called a hard brexit, which is particularly to do with the u.k. withdrawing from the single market. this is a real spanner in the works, for the prime minister. vonnie: you mentioned that the low among thet is populace. still -- they still believe that what was sold to them is going to materialize, and soon? ms. fordham: i think that's a different question. if you look, it was about the conditions under which you would think that brexit was not a bad
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decision. it unemployment going up meaningfully and on a planet a fairly historic low. it's food price inflation, these kinds of things. they just haven't transpired yet, but they might, come first or second quarter or the middle of next year, which is why i think things get tougher for the prime minister around that time. i think she feels the same way. she wanted all this to be done 2017-20 19 withdrawing then hold new elections in 2020. now that timetable is looking a bit different. david: you look at political risk in the u.k. and europe, let's tie this back together. look at thes it to brings a vote when you consider what could happen in the u.s.? brexit vote ise a watershed moment, and thinking about political risk in the advanced economies. 20i first are doing this, years ago, which in at emerging markets and political risk.
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the idea that the two biggest sources of political risk this year, we flag it in january, would be brexit and the u.s. elections is a ordinary place to be. both of these phenomenon are likely carry into next year, plus we've got french, german, dutch elections and all of that impacting the kinds of negotiations and the kind of deal of the u.k. might get. ,ell it's not exact correlation of course, brexit is a reversible. and whoever is the next u.s. president can be voted out of office in four years time, what it reminds us of is i think there has been a breakdown or break in the correlation between what is perceived to be in voters rational economic self interest. markets always get that wrong. for 10 voters in the u.k. thought leaving the european union would not impact negatively their personal finances. i bet a lot of trump households feel that way. vonnie: not voter ignorance, but
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voter entrenchment is part of it. there are many different things that play into it. tina, in the case of the british voters at least, is there going to be a mass realization at some point that this is all not possible? what britain wants is effectively almost impossible? ms. fordham: there might be. as investors, who you blame for things going wrong? rhetoriclready see saying if brexit is in good way we hoped, it will be because of the french and the germans and the dutch and the norwegians and the others not giving us a good deal. there's already some distance in going on for many negative economic consequences. the simple reason that we don't see a lot of this regret happening right now is because markets after an initial selloff have been pretty kind to the brexit phenomenon. brexit hasn't happened yet. continues torowth take along nicely.
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as it does in the u.s., for that matter. but that's where i talk about this sort of disconnect. perhaps the economic outlook not being so tough maybe gives people more comfort in sending a protest message and taking a risk on a nonmainstre political actors were decisions. fordham, citigroup chief global political analyst joining us from london. vonnie: still ahead, nestlé and oracle. this is bloomberg. ♪
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david: this is "bloomberg markets," i am david gura. vonnie: i am vonnie quinn. aacle shares are up after
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squabble over the price. we are joined by cory johnson in san francisco. i'm not even kidding, what role the wikileaks play in the steel? -- this deal? cory: they may have had a significant impact, oracle offering to buy netsuite, even as larry ellison was the largest shareholder of netsuite. the belief is they weren't getting the best price possible. oracle stepped back, larry ellison said we are not going to powershares, we want to enable better corporate governance. tiaa-cref was left as the largest holder shareholder. --n came the d.c. leagues
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leaks. and we saw from colin powell, the four also -- former secretary of state. onto the board of salesforce and on the border salesforce, he receives some documents about netsuite and a lot of other companies that salesforce was considering acquiring. amongst this deck of slides about potential acquisition candidates, colin e-mails showed salesforce is not likely to make a deal because of larry ellison's outside stake. tiaa-crefout after protested the price. they said this actually is not going to get another bid. no one else out there, including salesforce is likely to make an acquisition with larry ellison controlling so much of this company. it might be the best price we receive his company. as a result, deal on the table was a deal they were willing to take. david: what does oracle get in acquiring netsuite? fundamentally, a strong
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cloud-based enterprise software company that's focused on a lot of the current customers that have been difficult for oracle to acquire in their cloud business. smaller businesses, customers were very agile in making short-term decisions about their software decisions. they seem really beloved by their users. oracle has got that. cory johnsonnie: is joined by carol massar around 30 minutes. that's for "bloomberg markets," on bloomberg radio. david: the biggest movers as earnings season draws to a close. we saw surge after nine-day slump. this is bloomberg. ♪
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these medicare advantage plans can combine your hospital and doctor coverage with prescription drug coverage, and extra benefits all in one complete plan for a low monthly premium, or in some areas no plan premium at all. other benefits can include: $0 co-pays for an annual physical and most immunizations, routine vision and hearing coverage, and you'll pay the plan's lowest prescription price, whether it's your co-pay or the pharmacy price. or pay zero dollars for a 90-day supply of tier 1 and tier 2 drugs, with home delivery. don't wait, call unitedhealthcare or go online to enroll in aarp medicarecomplete. vonnie: live from bloomberg world headquarters in new yorkdavid:, i'm vonnie quinn. david: i am david gura.
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mark crumpton has more from the newsroom. mark: the final bluebird politics poll before the election is out shows hillary clinton with a narrow lead. nationwide surveys has been at 44% and donald trump at 41%. in a race involving third-party candidates. that is within the poll's margin of error. that survey was taken this past weekend. the poll also asked her publicans and those leaning that way with the party should do it trump loses. 62% say republicans should become more moderate and tone down harsh rhetoric or start from scratch and rename or reinvent the party. trump kicked off his campaign with a rally in sarasota florida , criticizing the fbi for not charging clinton in connection with her newly discovered e-mails. from said quote, now it's up to the american people to deliver justice at the ballot box. trump plans to continue a breakneck campaign with rallies
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in five states. secretary clinton has appearances in three states. the multistate information sharing and analysis center is working with the department of homeland security to prevent hacking attacks on election day. a monitoring network has been set up in 49 states. more than a dozen analysts are working around the clock, looking for threats against election and voter registration systems. russia is said to be on board with an opec agreement to limit crude oil production to help rebalance the market. that's according to secretary-general mohamed burke readyho says members are to churn out there. he says cooperation will help bring the market back into balance. rush is due to join opec for talks in vienna this month. global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries.
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i am mark crumpton, this is bloomberg. vonnie: mark, thank you. it's head over to julie hyman for a check on the markets. ,ulie: the rally is continuing but what's interesting is not only are we seeing the biggest one-day increase for the major averages since march 1, it's also been remarkably steady throughout the session. in recent days, we have seen a lot of chopped back-and-forth, even on days that we saw during the nine session losing streak for the major averages. there were times during various sessions where stocks were actually positive. it was a lot of bouncing around. today, we are not seeing that through the same extent. stocks rallied out of the open and have stayed there. what's fascinating about the last couple of weeks is that the election has overshadowed all else going on in the market. things like earnings season, like the jobs report, like the fed. i wanted to come back to earnings season in particular. we are nearing the close of it. 420 80 four to 29 companies in the s&p 500 have reported. you can look at this on ea if
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you are a bloomberg customer. this is a snapshot of the growth we've seen in earnings and sales trade on the top line, sales growth is a 2.2%, earnings growth at about 3.2%. some of the best performers have been with discretionary, health care, financial as well as utilities. interesting here. we tend to see companies beat analyst estimates. but it does look like the so-called earnings recession came to a close last quarter. theory bed in underpinning stocks. in terms of today's session, a couple of earnings winners that we had better notable include dean foods, which saw milk volumes drop but not by as much as in recent quarters. though shares of 2%. cisco, the largest north american food is your bitter first quarter profits beating theirtes as the expanded presence in europe. of ferrari on the strength the raised to this is 16 profit
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target -- 2016 profit target. it saw initial deliveries of a vehicle. some earnings stand out in the election is important to the markets, but some other stuff that is also underpinning some of the gains. vonnie: julie, thank you. david: more insight and analysis on the market, let's bring in mike regan. what accounts for the steadiness? was amazing that the nine-day set up coming in today, it was like the risk appetite was slowly on a dimmer switch and dialed down to nothing. unlike anything most of us have ever seen, the nine-day streak, the longest slump since 1980. but only 3.5%. we've seen were single days in the market, but that steady back away from risk and then all of a sudden, risk is turned back on like a light switch, rather than the dimmer. what's fascinating to me is the groups leading the rally today.
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it's health care and financial stocks. the whole market is going crazy. everything is up, but in the lead or health care and financial stocks, which other groups you would not expect to see doing well with a hillary clinton presidency. i think there is a sense that maybe it's that goldilocks scenario where she wins, but she doesn't sweep congress and there is gridlock that would probably be the best case scenario. vonnie: it's like fear was building up until the jobs mixture of others a good and bad data points. it looks like there was a narrowing of the margins. now, maybe the market is thinking the outcome is obvious. the fbi announcement is a big thing, but those poll numbers were starting to converge during the end of the week. it site trump have the momentum, the worry would be that he would get a little bit ahead in the polls over the weekend. we didn't see that. they sort of stabilized with
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hillary up to two points and in addition to the fbi, clearly, the fbi coming out and saying something more about those anthony weiner e-mails i think was the main risk that everyone was worried about. that takes that big risk off the table. vonnie: the other factors --david: the other factors here at play, the correlation between the mexican peso in the u.s. dollar, have we seen a correlation between stocks and polling throughout the election? tighter -- amuch got much tighter the last week or so. we got really fascinating is how tightly the site -- the stock market was correlated together. stocks were rising and falling together, as the falling of the last week. index dcj, implied correlation looks at options prices much like the vix looks to suss out implied volatility. this looks to suss out implied correlations and it just shot higher last week. under the notion that it was a market event. it was an industry groups that would benefit, people were
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backing away from the entire market. vonnie: i am loading it. so our listeners can see. there it is, jc j index. mike: that shows you how tightly correlated the s&p 500 became with all stocks moving in the same direction at once. a big drop today, but still a pretty elevated level. stocks are now all rising together. gadfly, which you write for, that was last week. that index shows, the vix shows that concern was pretty widespread. vonnie: tina fordham was telling us that one of the risks that we don't have and have a result of the time markets open, at least asian markets anyway, into the u.s. on wednesday. how big a risk is that and what happens to those people?
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mike: i think we see another risk off event. obvious the, the polls are favoring hillary right now. inre has been a dwindling confidence in how accurate polls are after brexit and after some of the surprises in the primaries, especially on the republican side. i think any contested election, i would expect a risk off mood to return. mike regan, columnist for bloomberg gadfly, for that commentary on the bloomberg. thank you. vonnie: new voter --david: newsletter david -- new voter data from the canadian election. could this work in the u.s.? this is bloomberg. ♪
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david: this is bloomberg markets, i'm david gura. vonnie: nine vonnie quinn. europe should be a high priority , burns isxt president a former undersecretary of state for political affairs as well as former ambassador to nato and greece. on bloomberg americas daybreak, david westin asked why europe should be in america's national interest. global country. our next president has to pay attention all parts of the world. i think the issue where we can be most active is helping to contain vladimir putin. following the invasion and annexation of crimea in 2014, the division of ukraine, his earlier invasion of georgia in 2008, putin on a north-south line is trying to redefine the european continent to the south and west of the russian federation. nato is going to be moving under u.s. leadership, italian troops
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into estonia, and lithuania. i think firming up that position , and also rebuilding u.s. military capacity in europe. i hope that would happen. best way to contain putin and help give the europeans some stability, so they can deal with these other problems a really of their own -- need european solutions. david: you refer to the volcker -- the baltic states in the same sentence as european -- as jordan. latimer putin seems to be an opportunist when it comes to these things. he will move and as he did in ukraine when he sees an opportunity. how concerned should we be about the next 90 days? that should be concerned he will try and test us during this transition. one of the things that's going to come up his financial sanctions. the energy and financial sector sanctions that have been put on russia by the european union. they have to be extended by
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consensus vote, meaning every country has to vote for it to that happens in mid-december. president obama is going to push very hard for the europeans to continue the sanctions, because putin hasn't met the conditions to lift the sanctions and hillary clinton, will very strongly support the continuation of the sanctions. i hope she's going to be the president. it's donald trump, i think all bets are off, given his unorthodox and i think very weak and very dangerous views about russia. you declared yourself on the hillary clinton versus donald trump issue. how european leaders see this? do they have a preference? >> we can say with some degree of certainty that vladimir putin and the russian government would like donald trump to be elected because they perceive that he will basically withdrawn american forces from europe. trump has been denigrating nato, he will make nato weaker. he won't be the strong american leader in europe that europeans are accustomed to.
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it's clear that the russians, by their actions and words, support a donald trump candidacy. every other european governments, david, i talked to a lot of them, desperately want hillary clinton to be elected because they want stability and they want to traditional american leader and a leader who is sophisticated enough to understand how the united states can be effective in that region very i think for most west european and east europeans, trump is a real danger to them. david: -- vonnie: that was the former undersecretary of state for political affairs and former ambassador to nato and greece. david: a look at the biggest business stories in the news right now. the sec is investigating whether big banks have been mishandling securities for american depositary receipts, the wall street journal cited people close to the investigation who say the probe will not necessarily result in an enforcement action. the sec sent subpoenas to for banks, citigroup, deutsche bank, and j.p. morgan chase.
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tesla says it will lend for use of its worldwide network of charging stations. cars ordered after jittery first of next year will get 1000 miles worth of credit to supercharge and stations. owners have to pay fees after the credits are used. tesla did not specify the amount but it's a charging would cost less than filling up a comparable gasoline powered car. in a documentary film the chronicles bill ackman's efforts to take down herbal life get a wider audience thinks it is to region deal, betting on zero reached theaters early next year via a gunpowder and sky distribution. movie debuted in april at the tribeca film vessel. the says the company is a pyramid scheme, the company denies it. that is the bloomberg business flash. vonnie: in politics, donald trump could draw a few lessons from canadian prime mr. justin trudeau. a new study says that a wave of minority support helped justin trudeau to power a year ago. election data says a surge of latino voters in the u.s. is
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backing the democrat party. , mark bunting joins us. explain to us what type of hispanic vote that justin he won it., and how labor forcesed the survey to get a much clearer picture as to who voted for just a drill last year during the election. we knew that his voters were mostly younger, pro trade, pro-immigration. many of them identify themselves as feminist. however, based on the labor force survey, what they're are saying now is that recent immigrants, indigenous people and millennials really helped to sweep mr. trudeau and the liberals in the power. for example, recent immigrants in terms of their voter turnout, it jumped 14% from the 2011 election to about 70% total overall.
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immigrant turnout for the vote last year with 76%, indigenous peoples, 15% more of people from that group. and trudeau really courted minorities, and part of his campaign was to bring more syrian refugees into the country. he did just that, and that clearly resonated with a lot of people. david: help a strong parallels of they exist between what happened in canada in 2015 in the u.s. president to raise that's going on now. democratsnow that the tend to get more of the minority vote. they have, historically. wheels another many people think the donald trump on the republican side has alienated all sorts of the minority voters. muslims, in particular. and that his support among hispanics and african-americans is believed to be quite low. angus reid is a polling company, they are looking at the early voter turnout in the united states. they are estimating that is the stands now, clinton has about
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66% of the hispanic vote, and well ford really do her in various states that have high hispanic population, such as florida, arizona, nevada. clinton has about 86% of the african-american vote, apparently, according to angus reid, lower than what president obama had the last couple of times around, but still very high. and 64% of all nonwhites. on the trunk side, he has very strong white working-class voters support. mostly older, mostly male. younger, people 54 years old and under tend to support her. people 55 years old and older tend to support trump. the point we are making here is moreclinton is certainly in that room mold in terms of trying to appeal to minority voters. it's fascinating the differences between canadian and american voters. honestly, huge differences.
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only one in five canadians are foreign-born, for example. highest in the group of seven. trudeau campaigned on increasing intake of syrian refugees as well. mark: he did do that. .2 5 million immigrants coming to canada every year, and it wasn't that hire hire, our economy would be about one third slower, less dynamic, with fewer , but also inions the fiscal update recently, the government decided to bring in some rules that technology companies were asking for, and that is you can fast-track a skilled worker into the country now in about two weeks. used to take several months and technology companies and other companies that require skilled workers were complaining, saying we are missing out on all sorts of skilled people who are going elsewhere, the u.s., for example and silicon valley because we can get them into the country weekly enough. mark bunting for
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bloomberg tv canada, thank you. upid: the man who has taken the task of trying to get republicans to at least consider i'm a friendly policies. this is bloomberg. ♪ -- climate friendly policies. this is bloomberg. ♪
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david: this is "bloomberg markets," i am david gura. a donor trying to shift republican stance on climate change is learning how little that money buys. we talked to zach miner about his profile of jb is on. -- j phase in. local rookie, a successful business guy who sold company for about $200 million. decides toars old, devote everything, basically. all the time and most of his the republicans
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to shift on climate change. it's like is one issue. he shows up in washington last summer and start spending money and trying to move the party. my story is sort of about all the obstacles he faced and how much he had to change to try and find amid a way to work. >> he came in with the mission of trying to get it on the republican platform about global climate change. >> he really wants to change the party. in the first idea he had was let's start with the grassroots and maybe the problem is that -- they're notrs hearing conservative voices talking about this issue. let's talk to them about the digital ad campaign, facebook and google to try and get their attention and tell them about the science. but just to not work. people do not pay attention to it. >> which part of that spectrum to the start at? did he start as a staunch
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climate supporter and advocate of these ideas? or did he start as a hard-line republican and then married these ideas with that? >> he's been a republican forever, his dad was a big wheel in republican circles in charlotte, north carolina, where he is from. kind of a local powerbroker. he grew up in his experiences the business -- in the business world confirmed that his a small government, pro-business kind of guy. but then 15 years ago, he started to get interested in climate change and he is the kind of guy who asked and resulting research. >> he sounds like he had to convince himself through various means. whoeard from business men were concerned about this. he did his own research. he was able to bring himself over to this knowledge, but what were the impasses that he saw within the republican party? was it strictly ideology?
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was the money behind it? why was it so difficult to get people to have this experience? put ads ont when you facebook about climate change, liberal people agree with it and conservative ones to shut down, even if it's coming from trying to be presented in a conservative voice, to be above the partisan fray? i talked to this really interesting professor at yale. that isthis thesis persuasive, when it comes of these hot button issues, there's nothing you can do today that will stop climate change or not. it's all very abstract. peoplees like this, when think about the science, they are really trying to present a version of their identity that is acceptable to the people around them. liberals are just as guilty of this on various issues, where
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they reject the scientific consensus if it's on the other side. when it comes to the storage of nuclear waste, is a scientific consensus that it's really not that scary. liberals all think there a scientific consensus that there is. it's the same thing on climate change for conservatives. david: you can read that story in the latest issue of bloomberg businessweek. even here more every saturday and sunday on bloomberg television and bloomberg radio. stockman on why both candidates will not be able to stop a recession. after 3:40 p.m. eastern. this is bloomberg. ♪
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7:00 and london. i am scarlet fu. i am matt miller. welcome to bloomberg "markets."
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live from bloomberg world headquarters in midtown, manhattan. covering stories from mexico city, washington, d.c., and new delhi. stocks rallying ahead of presidentials. election. equity investors need to brace for volatility after the next president is elected. what could a trump presidency mean for our neighbors to the south? we are still asking the question, and we are's -- they are still worried he would try to build the wall. a look at loyal and the upcoming election meeting. doing tocompany is deal with the global glut. julie hyman joining us with the latest look at what is going on
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in equities. major averages are rising the since march 1. that was a primary day. a big bounceback today. a percentage point below where we would need to be. since march 1. that was a primary day. a bigvolume about in-line with t we have seen. we continue to look at election. of the one thing blackrock has done is crunch the correlation among various sectors, depending on whether clinton or trump is up in the polls. election.ike the one thing clinton victory has been most correlated to consumer durables, capital goods, and auto stock, and conversely, when trump is gaining we see things like insurance, banks, and drugs perform better.
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means universal. you will see that everything is up to date. all of the groups in the s&p 500. despite theigher fact that this does seem to be a rally on the idea hillary clinton has a better chance of winning. someockets that may do better than worse. japanese yen gaining in the recent weeks. looking potentially at 100 54 the yen. >> a check of first word news.
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>> the presidential campaign and the candidates will cram in as many spots as they can. donald trump will hit five. meanwhile, the final nationwide poll it shows clinton has a never lead over trump. i race involving third-party candidates. president obama is making mx licit pitch to michigan auto workers. he says donald trump does not care about their future. campaigning in ann arbor outside detroit. he said they have earned through saving. auto industry early in the obama credit -- presidency. chris christie pushing back.
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in an interview with charlie rose, governor christie insisted he does not remember receiving up late from anyone about the traffic chaos unfolding at the time. >> all he said to me was there was traffic at the george washington bridge and the mayor was not getting phone calls returned. i have to tell you, i have no regulate -- recollection. >> former aides were convicted last week in connection with the scheme. another aid earlier pleaded guilty and was the prosecution's star witness. india whereis an she clash over immigration. he wants the u.k. to take in more indian students who want to study their. policy ofrts the requiring indian students to return home after their courses. that has caused a number -- the
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number two fall by 50%. global news 24 hours a day powered by more than 2600 journalists and analysts in over 120 countries. this is bloomberg. stocks taking the dayto read a little bit and rise breaking the nine day fly, the longest in decades. after the fbi cleared hillary clinton in the latest probe. alan greenspan told daybreak america's there is still plenty of uncertainty, even if hillary clinton wins. think the markets understand what type of future there is out there, and that is causing a considerable amount of uncertainty with either possible nominee.
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i do not think this is a strictly analytical approach. there isn't any. do not think this is a strictly analytical approach. there isn't any. we will have to send our way along. --joining us, oliver ran it all of her redneck. we are seeing gains in stocks, 2% gains. put this into context for us. >> you mentioned this is coming off of nine days of the kleins. overall moving down. seems like the race will be tight. >> before you were foreign. .- were born >> what is interesting is it is such a big move and across all of these different asset classes. are we done with the clinton if she wins?
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there is not any doubt in our minds that if there is an upset, she is up by three points, the surprise would be the trump win. is the converse true if clinton wins? it becomes a harder but at this point. >> the bond market is certainly at an inflection point. you have been writing about how the bond market has exploded since obama took office. >> the outstanding debt in the treasury market has doubled since the beginning of his .residency now that interest rates are set to rise, that has become an urgent trends. 2016xpense will triple by according to some estimates. >> the question is, will interest rates continue to rise? we know the fed is considering
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one rate hike in december, and then maybe two. they told us for this year and we got maybe one. is this an inflection point for bonds? the 10 year yield is maxed out. it obvious he has been coming since all of her was born. or do we see this continuing to fall? >> a lot of bond traders are starting to anticipate the reflation trade. they are seeing this pick up after waiting for price groth to come to play. if inflation picks up the same actinge people are asked it too, we may be looking at more rate hikes than anticipated. >> alan greenspan talked about this. inflationly stages of
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that are now developing take hold, you could get a fairly away from the .xtraordinarily low yields i think in the area of four percent-5% and eventually. >> there is the keyword, eventually. reactionthe knee-jerk and then what happens eventually. >> more likely than not it will be a big move in either direction. provide relief to the market. dailys move twice the average move. still a coin flip in terms of what will happen.
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when president obama was elected, markets sold off. 5% over two days. >> i hate to make this all about you, but if you look at every single election in your lifetime, we have had gains 12 months after the election day in almost every single one with the exception of the birth of the.com bubble. >> that is a good point. this speaks to the very idea of the story we wrote. this is trying to bring perspective. this is the point, generally stocks go up. this has much more to do with the economic and market cycle. in terms of turning points,
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there is a market that is the second largest in history. will hit have anything to do with policies or naturally it is coming to a close? >> there are a lot of versus. them, the shift away from disinflation. the fed it right now is the largest holder of treasury market. huge impact on a the price of bonds. >> the ecb is the biggest holder in europe. they have in some countries more than 30% of the issued debt. >> great to get your perspective. programming note, tune in electionor our special
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coverage starting at 5:00 eastern time. 7:00 eastern for our bloomberg election special with david gura and megan murphy. tomorrow.ll coverage we will continue to talk about it a little today. >> halloween a major rally in stock, take a look at where the industry's dance right now. dow industrials gaining 352 point. this is bloomberg. ♪
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scarlet: this is bloomberg "markets." i am scarlet fu. matt: i am matt miller.
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time for a look at the biggest business stories in the news right now. windstream holdings buying earthlink holding. and all stocks deal. the combined company will have a national network with 100 45,000 cable toeither off the provide internet and voice services. the bank of china's top officials says he is boosting compliance efforts after back down on illicit money moves. bank of china facing a two under fifth $2 million penalty from new york regulators. and moneyviolations laundering controls. it is unusual for a u.s. entity to level a penalty against the china controlled lender. debt tollion in new refinance three sets of senior
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note. days after the fertilizer company posted a loss in bonds fell to record lows. they will use the proceeds and pre-pay $1redit to billion. they have struggled with waning waning commodity prices and farm income. the world's largest contract chipmaker has surged 32% this .ear it now accounts for a 16% share of taiwan's entire equity market value. it is luring investors with as demand for iphones fuels orders. that is your bloomberg business flash. scarlet: going to abigail
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.oolittle nine stocks higher for everyone higher. care.e focusing on health lift to day.big this is a top percentage performer for the nasdaq. linked together on the news that a late stage trial for a jointly develop drug for a muscle ailment is showing, saying results toward a broader view. this would increase revenue
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impact. this could help upside potential for 2017 revenue and earnings estimate for bio jen. health care is the biggest and best performing sector for the nasdaq. the biggest drag is also a biotech name. this could be a bit of a whipsaw.from friday's friday it was up as much as 14% as some thought the company dropping out of an m&a conference, that there was m&a potential ahead. the company delayed the filing of the 10 q and could the restatement. the stock clearly down today. this is a different stop there. on the year down an amazing 37% year to date. >> thank you.
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donald trump has voted to tear wall on and held a bid the u.s. border with mexico. the contingency plan should donald trump win the election. this is bloomberg. ♪
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matt: this is bloomberg "markets." i am matt miller. i am scarlet fu. mexican investors are feeling more confident about the hillary clinton victory tomorrow. mexico has been concerned about a possible trumped victory. now is the mexico's and joins uschief for the election. we have been talking about the term proxy.
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how long has it been that drop -- proxy? >> you could say after the primaries it was all there. this has been the proxy had for many other situations willfully. even for brexit or any situation where emerging-market -- emerging-market assets are sold. currency.most liquid they get traded after hours. so it is the choice for many investors. anytime there is uncertainty, they go to the peso. kicked off his campaign by saying some of the currency. they get tradedmexicans illegalo the country are rapists.
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instantly racist undertones against latin american and mexican people coming into the , that has a lot to do with it. >> definitely. one can be trade. also immigration. when trump is talking about putting a special tax on those sending money back home to the house -- home country, that also affects it. investors.ar and not only mexico, but outside investors. >> i have a chart of the mexican peso. we have converted it so you can see when the peso declines in value, it goes down. it is not just trump. it is a pretty consistent downtrend. if the mexican peso being driven
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by cyclical concerns when there is a clear momentum over the past five years? >> you have to take into consideration other factors. oil is one of the main factors. mexico used to be a big seller of oil. now it is not selling as much. that's has an effect. then you also have the mexican economy has disappointed dictations. -- expectations. a lot of investors were really excited about mexico. >> while a trump win may be a negative or a number of negatives, a clinton win would .t just rang relief not exactly an upswing in the value of the pace though --
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peso. , the valuery wins may be another, the value may be another 3% because it has been gaining. then the will be another local factor. the chance of a downgrade. if trump loses, the downside could be a higher 40%. that is how much the peso could fall. >> how precarious is the president's position right now? , andt with donald trump that did not do well for his poll numbers. at a record low for any mexican president. he is still pulling a little bit beyond the record low. he wanted boths candidates to meet. he said i sent invitation to
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both at the same time. expecting really trump to say i will go next week. the problem was he is in a very difficult position. trump wins, this could be your next-door neighbor and most powerful partner. it did not help what the hillary campaign. >> thank you for joining us. looking forward to having you .ere all week of programming notes, tune in tomorrow for special coverage with a two-hour all due respect. ♪
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wrotet: from bloomberg
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headquarters in new york, this is bloomberg "markets." i am scarlet fu. we begin with gold falling as investors move away from safe haven assets and move into safer bets. all down 1.8%. industrial metals rising. copper rising. climbing for the first time in seven sessions with the risk the assets getting a leg up. wti higher right climbing for te in seven now. brent also moving up. are right at the $45 per barrel average. this comes after we saw prices retreat. following the failure to agree on output numbers. pumped out a record number in october.
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members looking to reduce production but still having difficulty figuring out who will cut what and by when. staying with oil. energy companies meeting at the meeting.n country -- speaking to the ceo of italy about his outlook for the year ahead. >> we have to maintain production. development.ith low operating cost. >> we are good at $40.
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number for you to our the requirements? >> number is to cover the investment was operating cash flow. our effort is to reduce it. the breakeven high are looking forward. we have a fair amount of growth at three something percent. overall number is about $50. >> talking about the marketplace. meetingoing to the opec november 30. could the market rebalance this year?
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>> i think we are very close. was 1.7.d demand closer.etting 2017 could be supply and demand. getting more efficient. even.r break what is the message for how secure isy? the dividend? normally we talk about the strategy presentation. what i can confirm is $50 is ok. not a high price, but something
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and 65.ains between 55 that is enough. enough to develop and continue to invest the business. >> we will take a positive message. , whatkinds of numbers would an opec cut mean that come by much do they need to cut market?ly support the >> we talk about $65. we talk about fundamentals. this is important for the financial investors. they like to know they are taking care of the market.
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a very strategic role. we have a floor. quite important. was the ceo speaking with manus cranny. a check of headlines on first word news. says they clinton choice for president cannot be clearer. she described donald trump as a loose cannon. she added if she was elected, she wake -- would wake up every to and the white house and think about what she can do to knock down barriers in create opportunity.
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mr. trump criticized the fbi's decision not to charge secretary clinton and connection with her newly discovered e-mails. he said now it is up to the american people to deliver justice. he has rally scheduled in five states. clinton has appearances in three states. own ohio restraining order against trump's campaign. the court rejected an application from the ohio democratic party. climate negotiators in morocco. the implementation of the paris agreement that became international law friday. this could be affected by tuesday's presidential election. donald trump said he would cancel the deal if he wins. 100 nations have officially pledged their support. is how toyour it he
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hold countries accountable. dayal news 24 hours a powered by more than 2600 journalists and analysts in over 120 countries. this is bloomberg. scarlet: one day to go until the election. hillary clinton leads donald trump in a bloomberg not -- bloomberg poll. this is bloomberg. ♪
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matt: this is bloomberg "markets." i am matt miller. scarlet: i am scarlet fu. looking at the biggest is the stories in the news right now. approving a new contract that will boost pay by almost 30%. it will also include retirement benefit.
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the southwest airlines pilots association and airline associated for more than four years on the steel. nikon cutting domestic jobs according to the nikkei newspaper. nikon focuses on medical devices and associated for more than four years on the steel. nikon cutting domestic other de. facebook agrees to suspend use of data of u.k. users for whatsapp for advertising purposes. this after they threaten to take action if the company used data without consent. that is your business flash update. >> going to the markets desk. >> we continue to see stocks hold at the highs of the session.
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a lot of trepidation still surrounding the election. today a bit of a relief rally. i also wanted to check on the individual stocks. club's is up nearly 16%. court marketplace did for the second straight quarterly loss. today they announced will buybank of canada as much as $1.3 billion in consumer loans. in terms of individual movers, we are looking at first data.
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this is the handling of card transaction essentially. the overall revenue rose by the same amount. the index has 245 members. there is one that goes back to the election related movers. that is cyber security firms that are rallying today as there are stories, including one by bloomberg news that there are concerns around cyber security can -- concerning the election. on speculation they will get more business surrounding the election or at least increased visibility. >> the u.s. presidential election is less than a day away.
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is lead over donald trump both candidates make their final appeal to voters. wayne. us is alex whenever we do the polls, we're talking about the popular vote. it seems that hillary clinton had a bigger mean as far as electoral votes are concerned. >> she can have only a slight lean nationwide, but can still rack up the landslide win. all she needs to do is win battleground states by a small margin. when in the electoral college will be more significant than a popular vote when.
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>> how early is early? >> i think they called the polls by about 8:00. put the kids to bed and follow them not to shortly after that. lexi has to win there. much of the landslide to you think we could be looking at. obviously the race could be close. what is the chance it is a lopsided race? whatwhat is the chance it is a lopsided race? what state does donald trump have to lose to make that happen? >> i think she wins 200 to his 216. , a might lose in washington weird story going on. donald trump us to win florida, ohio. hold his edge in arizona. probably needs to pull ahead in north carolina, probably
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virginia. pennsylvania, michigan, and a couple of the fairly dark blue states. each candidate controversial on their own and for their party. do we know this ale reporting >> democrats and vice versa? the last numbers i saw trump was only drawing 85% of its own party or so. pretty low for a major party candidate. >> if the independent voters that will really mean the selection, or at least will make it close. notlections like this, unusual for the unaffiliated break for the outsider candidate, the change candidate, not part of the incumbent party. lex what have we learned and what the six it just about hasout tuesday? >> turnout
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been real high and early voting. slight edge ina florida, which does not necessarily mean they won't win to his way. turnout has been a real concern. the black vote in particular. there were signs over the weekend that that improved. , looks like that state is already practically out of reach for donald trump there was such a heavy democratic turnout. thank you very much. i am sure you have been a very busy beaver, and i know the next couple of days will be very trying for you. >> programming note. tomorrow special election coverage. a two hour with all due respect. following that up at 7:00 eastern with the bloomberg election special.
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coming up next -- >> we will continue to talk politics. he is known as a partisan attack dog. plotting to reach across the aisle. his ambitious as >> we will continue to talk politics. long and aggressive. will he be able to get anything done cap go we will discuss next. ♪
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scarlet: this is bloomberg "markets." i am scarlet fu. matt: i am matt miller. if hillary clinton becomes our next resident, chuck schumer has big plans to reach across the .isle on the agenda, overall with international corporate tax is, immigration laws and more funding for scientific research. joining us is the bloomberg congressional reporter the joe weisenthal.
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talking about your forecast for the election. less than 24 hours away. how do you think we will see starting toout? >> look like hillary clinton is going to win, but she may not have the coattails she needs to win the senate. she could lose the senate and have the republicans keep it, which could be a disaster for her. so that is the real nailbiting you are seeing in democratic serve. worried about the states where the polls have been on the edge. the democrats want to turn it around and make sure people get out to vote for the down ballot democrats that are challenging incumbents in places north
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carolina, missouri. right now it is kind of a jump ball for the senate. >> if the democrats take the senate narrowly, will that be enough to put a hillary clinton nominee on the supreme court? the way the rules work right now is you can filibuster the supreme court nominee. but several democrats have already told me in interviews they would not allow republicans to filibuster indefinitely. i respect if the republicans try to hold up clinton picks, they would go nuclear and change the
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threshold. move.imate power the rest of the agenda because republicans probably would retaliate. >> hillary clinton with the senator for new york or eight years. she did have a relationship with those across the aisle. aremany of the senators still in the senate and can convince the republicans to work haveside her? >> she does relationships in the senate. there are a number that have talked about trying to reach across the aisle in the matter who wins. there is the potential to break
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the logjam. graham of north carolina has been eager to turn the page from donald trump after tomorrow. we could see some of that. republicans are worried about primaries. mete could be impeached proceedings in the house. it will be a messy scenario. that is why you see people like schumer say let's have a bipartisan pragmatic agenda. >> he is working with paul ryan on that. everybody wants to do this but never seems to get done. what stops them from working together? >> one of the big things is everyone knows there is millions of dollars part
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overseas. profits that apple and others do not want to pay a tax on by bringing it back. you can potentially use that for a larger, global tax reform deal. people like mitch mcconnell want to have a big tax cut package that would lower individual income tax rate. others,ut a deal for suddenly you do not have the lobbying. that is part of the equation. you also have democrats that are taxkeen on giving back credit to some of the biggest corporations on earth. you are looking at how clearly there is a risk on rally right now. it is pretty much green across the board. one equity markets in particular
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that has done very well, and that is italy. i think it is interesting, electionfter this tomorrow, the next big vote is the italian referendum. if trump wins, and he was talking about how if trump wins, and whatimagination they think about political possibilities after brexit will really start to open up, where else will we get both the go against the status quo? it really would not surprise me if early ascus in on it the next trouble spot. wonder if trump wins tomorrow whether we will expect the risk off scenario. take? brexit is
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clear-cut. >> its at stake in italy? is only about constitutional reform. hasver, the prime minister indicated he would not step down. movement,he five-star that is an anti-euro movement. people would start to wonder whether the country was one of the largest debt loads in the world could head for its own exit. >> it has become a referendum whether he likes that or not. scarlet: we will beast begin with david stock in, the former budget director, today. ♪
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how much you qualify for, the ways to receive your money... and more. plus, when you call now, you'll get this magnifier with led light absolutely free! when you call the experts at one reverse mortgage today, you'll learn the benefits of a government-insured reverse mortgage. it will eliminate your monthly mortgage payments and give you tax-free cash from the equity in your home and here's the best part... you still own your home. take control of your retirement today! >> it is 3:00 p.m. in new york, 12 p.m. in san francisco and 8:00 p.m. in len did not. i am matt miller. >> and i am scarlett fu. welcome to bloomberg markets.
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>> we are live from new york for the next hour. we are covering stores from pittsburgh, to london and beijing. u.s. stocks snap ago nine day losing streak. treasuries and gold are falling. are the markets giving us any clues about tomorrow's proceedings election? alan greenspan tells is how he thinks marketses and the fed will react to our next president. plus, white house budget director david stockton will talk about the nation's economy. >> we are one hour from the close of trading. jue hyman is here with the latest. he was doctor it was you were at the open. >> when stocks were bowses around between gains and losses frequently. today we are still near the highs. not quite, but near the highs of the session on this biggest rally since march 1.
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that snap-back from the big declines from we have had. looking in it, in more detail, inside the bloomberg. you have the big slump that was 3.1%, and the gain in today's session. to gapping higher and staying higher throughout the course of the day. i want to dig into volatility tilt a little bit. volatility has been spiking as risk assets, including stocks, have gone down. one of the things we are watching is the put to call ratio. do people expect volatility will come back, or now that we have seen this drop, is it here to stay? what you see here is that we are steegmans a higher number of -- seeing a higher number of puts versus calls there.
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is an expectation that the volatility will continue to come in, at least by this particular proxy. the other thing you can look at is the vix. both of these had spiked to their highest since the u.k. vote to exit the e.u., and they are coming down today. as you can see from the yellow lines here, they are still above the five overaverage. so it looks like there is still this volatility that is in the market. there is still hedging activity going on even as money is coming back into risk proxy assets today like stocks, and like the u.s. dollar for that matter. there is still trepidation. it is certainly not gone even though on the surface of it we have this big rally in today's session. >> julie, thank you very much. you'll you'll -- julie hyman looking at election day volatility. mark crumpton ton is with us in the news room. >> president obama made an 11th
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hour appeal to voters in michigan today on behalf of hillary clinton. speaking at the university of michigan in ann arbor, the president who carried the state in 2008 and 2012 urged his audience to make sure that history repeats itself. >> i ask you to do for hillary what did you for me. i ask you to carry her the same way you carried me. if you are willing to embrace hope again, then we will finish what we started. we will elect hillary as president. we will remind the world why the united states of america is the great estimation on earth. yo, we can. let's get to work. >> tonight the president will be at a rally in philadelphia with secretary clinton. they will be joined by former president will clinton and daughter chelsea, first lady, michelle obama, and rockers, bruce string steen and jon bon jovi. as for donald trump, he is
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campaigning in raleigh, north carolina. he kicked off his last day of campaigning with a rally in sarasota, florida, where he criticize the the f.b.i.'s decision not to charge hillary clinton in connection with newly discovered e-mails. trump said it is now up to the american people to deliver justice at the ballot box. trump plans rallies in five states. secretary clinton has rearnses in three states. outside groups trying to influence control of the senate poured in $52.3 million in last-minute campaign money last week. that is according to a campaign finance institute analysis of federal reports, which says the cash is going towards races in five states viewed as pivotal to securing a majority in the upper chamber. those saints include, wisconsin, pennsylvania, nevada, new hampshire and missouri. in delly, the most polluted city on the planet is taking unprecedented steps to ease bad
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air quality. as protestors dimon straighted, they shut down schools for five-day and put a pan on construction. those sectors could be most at risk if the government can't clean up the area. >> the wikileaks founder is going to be interviewed today. sweden's granted assistance.egal global news 24 hours a day, powered by more than 2,600 journalists and analysts in over 120 countries. i am mark crumpton ton. this is bloomberg. >> it is all about the u.s. election today, as julie was telling us. ago recent surge.
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the f.b.i. cleared hillary clinton on the latest e-mails. michael jones, investment dwroops chairman and c.i.o. joins us. we will get to your concerns in a bit, but first off, to what do you tribute today's recovery in equities and other risky si sets? was it the clinton thing or a bounce after the sell-off? >> probably a little bit of both. financial markets are making it crystal clear they do not want to see a president trump. when the f.b.i. investigation opened, markets started slumping, when they closed they wernts up markedly. to your point, after nine days of going down, the markets are pretty stretched, and it is ready to bounce on the first sign of good news. >> where do you see the markets going after i think is the question a lot of people are asking now?
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hillary clinton, an electoral victory i don't think anyone didn't believe that over the past couple of weeks. what is her affect going to be on the stock market? >> well, i think we need to be careful. in a world where polls have proven so unreliable, completely writing off the chance that trump could reveil in this election. ut jumping on, think there are two scenarios for clinton. one we call a partial victory and one empiric victory. a partial victory is she twins the presidency and the senate, she doesn't get the house. that we probably have prolonged grid electric. she is going to have to do some compromising, but she is going to be able to control appointments to the supreme court, and that is a nice lever she will have. that is a scenario for the markets to continuing higher, but having a hard time breaking
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it now highs. if the scandal of the last week causes the senate to flip and she isrequesting to be dealing with a republican congress, that gives a big up side to financial markets because you get the best of both world. you get business friendly policies, but you don't have to worry about a loose cannon in the oval office. >> how are you positioning yourself for this expected partial victory for hillary clinton? >> in our opinion, i don't think you can write off trump given the unrelyability of polls. a bad scenario would be a hung election, which is some states that are key battle grounds, might be within the margin of recount. we know that trump will not concede. that is a cowen side scenario for financial markets -- that is a down side scenario for risk market. we don't expect it, but we have a risk management plan for that
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outcome. if we get the hillary victory, the senate and house stays in republican hans, but she stays president, we are going to put a lot more money to work because that is a big up side for the markets. if trump wins, probably going to be a birthday day and month in the markets. ut we think ultimately the marks would calm do not and expect business friendly policies. >> first of all, i wonder what your risk management scenario is, or what your plan of action is in that case? >> we have a series of stop losses that i am sure my compliance department would prefer i not disclose. that if the market cannot hold several key levels on the s&p series 500, we have a of risk reductions we will be taking offer the portfolio. if there is a hung election, if we get into hanging chads again, then we will need to
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reduce risk in the portfolio simply because gore-bush, the market fell 8%. that was a fairly orderly process compared to what would happen with a candidate that has made it clear that they won't con steed and a supreme court that is now evenly divided 4-4. that means that it could go on ch longer than the bush-gore controversy, and that means the impact on the global economy and financial markets could be much more severe. >> you have written you look to be opportunistic if the markets drop on any sort of election surprise. >> it would be by the dip on a trump win. i think people might over react to how much damage he could possibly do, and i think we would want to take advantage of that. i think in a hung election scenario, if we got a big sell-off, we would want to see the market find support probably close to the first quarter lows, at around those kinds of levels.
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it would be scary and painful, but that would probably be a buying opportunity even in the face after rung election. because at the end of the day, the u.s. constitution and the u.s. electorate or strong enough to resolve peacefully any electoral dispute, even with a candidate that stubbornly refuses to concede and a hung supreme court. >> thank you. the investment group chairman and c.i.o. you want to tune in tomorrow for your 0 election coverage. it is a special that begins at 5:00 p.m. it is a two hour special with mark and john heilman. we follow that up with david and megan with our 2016 election special coverage. >> mcelroy ahead on the election -- more ahead on the election. it will be the first change in administration since the financial crisis. alan greenspan weighs in on what challenges are ahead to the nexus us president.
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this is bloomberg.
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markets. bloomberg i am matt miller along with charlotte charlotte. >> alan greenspan has seen his share of change in government. he joins bloomberg america this morning. ey asked him how the functional political environment set against the fed chair. >> i don't think the markets understand exactly what type of future there is out there, and that is causing a considerable a lot of uncertainty with either possible nominee. i don't think this is a
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usually strictly analytical approach to solve this. there isn't any. we are on ground not covered previously, and we are going to have to fend our way along. >> it is ground not covered because we have a lot of behavioral regulation as well as other things. will this be the first test of whether that behavior approach is effective? >> no. i think we know right now it is not working. it hasn't been working from square one. going back to dodd-franck, for example there, is only one thing that is working, the one thing that is a wise thing to do with the significant increase in capital requirements for banks. nothing else has done anything her, as far as i can see, to reduce the liquidity in the financial city. >> there is an aferingt that
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risk taking capital has been eroded off the back of regulation. in your mind is the market able to efficiently price risk still, and if not, what needs to change? >> well, to the extent that we are with drawing a number of the highly technical issues that exist in the financial system, we have removed a lot of them. and as a consequence, there is less ability to respond. unfortunately, that is the politics of this. so i don't know exactly how it's going to come out, but i would very much like to go back o square one, repeal d.o.d.-franc, come in with a repeal e -- dodd-franck. and i second there is very little either you need to to in
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the regulatory system that wouldn't be solved with that simple regulation. i am thinking in terms of 20 or 30% capital requirements. everyone tells me that will cause the banks to go into serious trouble. history tells us no. that the rate of return on equity in banks is competitive with all other aspects of the economy, and we have data going all the way back to 1869 which confirms this. all i can say is that the sooner we do something here, the better. >> alan, i want to turn back to the markets again quickly. last time you were on, you said that the bull market in treasuries was unsustainable. since then the dip has continued to be the theme in other countries like germany and japan. how long do you think the bond bull market can go on? what is background going to burst it?
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>> well, it may very well be the fact that we are moving into very early stages of inflation acceleration. that could be the trigger. it has always been a very unusual bond market. we have never seen anything else like this at these low rates for a protracted period. we have never seen them, period. the result of this is we have no way of getting a historical handle on how to handle this except to say that is only one long-term direction in long-term interest rates, and that is up. >> i want to turn back to the presidential election. there is going to be a new president one way or the ear come january. what are the options open to that president in dealing with the economy? putting aside what they should do, what can they do given the state of the economy and the government? have to k they first
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identify the problems. if you listen to debates both in the primaries and both primaries, nobody is addressing the fundamental issues that need to be addressed which as i have said before on this program many times. entitlements are rising and checking off gross domestic savings, and ultimately gross domestic development, and it is a major cause of the reason why output per hour of productivity were so flat not only in the united states about, throughout the developed world. >> alan, thus far we have geten through this by borrowing more and more. what are the factors that will keep us from continuing on that path? >> it can go on for a remarkably long period, until those who are lending the money revolt. i see no sign of that yet.
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t if the early stages of inflation where are now developing take hold, you could get a fairly soon major shift away from these extraordinarily , i s on 10-year notes think up in the area of 3%, 4%, to 5% eventually. that is what has been historically not only for hundreds of years, but thousands of years. this is an extraordinary period in which rates have been held down merely by the fact that government has set in motion a set of circumstances which enforce that. this cannot go on indefinitely. >> that was former fed chair alan greenspan speaking on bloomberg television. >> still ahead, the next president will face challenges with vladimir putin's russian.
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we will look how to trade russian stocks in the aftermath. this is bloomberg.
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>> this is bloomberg markets. i am julie hyman, and it is time for options inside. joining me is jim of m.k.m. holdings. we have been talking a lot about how volatility ran up in the past couple of weeks. it is coming down a little bit today. you are a student of history. we have had a look at the volatility curve this time around versus some of those past shocks. by that measure? >> mush adieu about nothing. just to frame it sicklyally, we have been looking for higher volatility. yes, implied volatility lifted into this election. we had a graph on friday versus
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the average of the last three shocks. january-february of this year, brexit and also august of 2015. when spot vix peaked we were there. we are basically nowhere. we inverted mildly, front end got up to 21 or so. obviously back into the 18's ally a quick claps -- collapse, even more so relative to brexit. who knows what the next 48 hours will bring? the next graph is s&p 500 10-day realized volatility. this is the standard deviation over the last 10 days. as of friday it was about 3.%. you can go back as far as you care to look in equity markets, and it is about as low as it can get. really implied terms, in
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perception, highly volatile then. nling actual terms, a non-event so far. >> so in other words as we say traders are hedging, bracing themselves for the unknown. yes, they are bracing themselves, but not as much as they have been around other shocks to the market? >> you could certainly say that, although i will-pound out anecdotally, institutional clients came in and rehedged again today. looking out for december. not just the election, but you get opec at the end of the month, and the fed. and december catches all of that. moving on to the trade of the day. obviously there has been a lot of ret rick around russia, although one -- a lot of redick rick around russia. -- a lot of rhetoric around russia. >> we are looking at r.s.x.,
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russian e.t.f., and we are coming at it from energy side. implied volquez at this time across the energy space is historically low. w.t.i. crude is down 15% from recent highs. there is volatility. it is not really showing. what we want to do is go out to december. you by a 17.5 to 19 advantage. you buy both of those expecting volatility. >> leave it there. back to you guys. >> thank you for that. still ahead. ormer white house budget director david stockman talks to us. wow, x1 has netflix?
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♪ grace and frankie, hemlock grove, season one of...! ♪ show me house of cards. finally, you can now find all of netflix in the same place as all your other entertainment. on xfinity x1. we're opening more xfinity stores closer to you. visit us today and learn how to get the most out of all your services, like xfinity x1. we'll put the power in your hands, so you can see how x1 is changing the way you experience tv with features like voice remote, making it easier and more fun than ever. there's more in store than you imagine. visit an xfinity store today and see for yourself. xfinity, the future of awesome. >> im mark yum ton. time now for bloomberg's first word news. the u.s. supreme court has turned down a request from ohio democrats to issue an order aimed at preventing trump
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supporters from harassing voters on election day. leader ginsberg noted that stay law already forbids voter intimidation. the case is part of efforts by democrats to head off what they say is vigilanteism by the trump campaign and its backers. tomorrow the justice department will send more than 500 election monitors to 38 starts. that is 35% fewer monitors than to your years ago. federer poll watches has been curtailed pause of a 2015 supreme court ruling that gut add key provision of the voting rights acts. white house press secretaries says president obama continues to have confidence in f.b.i. director james comby and views im as a man of integrity and character. he sent a new comment about hillary clinton's e-mail than and saying the f.b.i.'s review is complete and stands by the recommendation that no charges

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