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tv   Bloomberg Markets Americas  Bloomberg  March 13, 2019 1:30pm-2:00pm EDT

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felonies uncovered as part of special counsel robert mueller's investigation into russian election interference in 2016. a judge in washington sentenced him today for illegal foreign lobbying and witness tampering. he will serve 43 months on top of the 47 months he has already received. the combined sentence was short of the 34 years he could have received. are warning the crisis in syria is not over. and are calling for large-scale support for more than 11 million people in need. the unc it -- it says $3.3 billion is required to help meet needs plus $5.5 billion to support jordan, lebanon, and turkey, where most syrians take refuge. a conference is set for tomorrow in brussels. in venezuela, protest fatigue may be setting in. a rally for juan guaido through a small crowd. so did a pro-government demonstration. millions of venezuelans are struggling for necessities.
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a nationwide power outage has choked off water surface -- service. highest courts has reinstated former new england patriots aaron hernandez's murder conviction. the court rejected the legal principle, after he killed himself in prison. hernandez was found guilty in 2015 of killing a football player. the 27 euros former football star was found dead in his prison cell in april of 2017. global news, 24 hours a day, on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. ♪ shery: live from bloomberg world
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headquarters in new york, i'm shery ahn. amanda: live in toronto, i'm amanda lang. we are joined by our bloomberg and bloomberg audiences. here are the stories -- shery: keira the stories we are following. a more uncertain brexit. theresa may's deal thrown out again by parliament and theticians are forcing government to take a no deal exit off the table. we will have the latest. deal or no deal? trade talks between the u.s. and china are at a critical phase, but mixed signals from the white house and beijing are raising concerns that a final agreement to end the trade war is nowhere in sight. boeing's crisis. canada is the latest country to ground the aircraft. the pressure mounting on the faa to follow suit. we will have the latest. let's get you started with a check of the major averages. u.s. stocks rallying. the s&p 500 at the highest level in four months. gaining ground for third consecutive session. every sector in the green.
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we have positive data showing the order for business equipment rebounded in the month of january. by the most in six months. rose less than expected. the dow up 7/10 of 1%. really positive sentiment out there. even boeing managing to hold onto some small gains after being pummeled in the last two sessions. we are seeing the pound rally right now. we head to another brexit vote. traders thinking potentially the u.k. parliament will vote against a no deal brexit. and opt for an extension of the deadline. amanda: i want to show you two stocks being hit. the two largest carriers in canada, air canada and westjet. this comes after the announcement from transport canada that we will ground all nine andx eight and not allow them over our airspace. you are looking at a big hit for
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air canada on an intraday basis where it stood earlier. one of the issues here, of course, is thousands of people fly canada. -- fly daily. 9000 to 10,000 people fly a day. they will work to try to sort out new planes, new routes, and help passengers. it will cause turmoil. it leaves us straight to where the faa is. mark garneau, our transport minister, former astronaut and trained pilot, made the announcement this morning and noted one of the reasons canada changed its mind was new information. satellite data that does point to some similarities. he says it is too soon to say, but similarities between the incidents at that you feel be in crash five months ago. it leaves this gaping question of why the faa is not moving and how much pressure there must be on it if it has the same data? like they doks have the same satellite images but they think this is still inconclusive.
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on the a lot of pressure faa. especially when you have these historically key allies including canada, the u.k., australia, banning the 737s. it says a lot about what pressure they are putting on the faa. really putting the u.s. aviation administration in the spotlight. and its credibility being questioned. amanda: absolutely. credibility, of course, as the leadership in the u.k. under pressure. battle lines being drawn. at issue, a new deal brexit. prime minister theresa may suffered an overwhelming defeat on her divorce deal yesterday. with u.k. lawmakers voting again today on whether or not to leave the european union without an agreement or put an extension in place. here with the implications is heather conley, senior vice president and director of the year program who joins us from washington. i want to start with -- there are so many possible outcomes.
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we should note that once again, uncertainty has to be the name of the game ahead of the evening vote in the u.k. is there an expectation of what will happen here? even suree are not what the house of commons is going to vote on in the next few hours. there coming on with you, is a question of whether that amendment that the house can vote on to block a no deal exit will proceed? the principal sponsor of the amendment under great pressure by theresa may's government had decided to hold it. at the speaker of the house, john burke out, who we all have come to love for his order, take --e is meaning maintaining that that goes forward with other sponsors to we will have to see. the government is pressuring all mps to refrain from voting on this. we will see what happens. the uncertainty grows by the hour. shery: where does what happens this week put the balance of
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power between the u.k. government and the parliament, and what does it mean for the brexit process? heather: you are right. we are seeing a transition away from government controlling this hands is going into the of the parliament. that is the sovereign in the united kingdom. the house of commons is deeply split. they do not have a majority path now for any past -- forward. an interesting point made by michael go, the environment secretary that was speaking on behalf of theresa may because her voice is gone, he said that the government may allow what they call indicative votes. meaning the house of commons will start voting to see where that majority actually is. this is an important sign that the government is starting to loosen the reins and parliament is beginning to take this over. it really does mean chaos. we are not sure what they can vote on. parliamentary procedure will be key. speaker of the house is about to be demonstrably important to the
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future process. amanda: meanwhile, there is a real deadline. one option on the table, an extension of the deadline. if that becomes bogged down and that is not something that is actually -- there no resolution or extension, what is the scenario with businesses having to complicate -- contemplate managing? heather: this is what is terrifying. tomorrow's vote on thursday will be about seeking an extension if in fact the new deal amendment passes today. but we do not know what time frame we are asking. ishink the u.k. government going to ask for very limited time period. they want a few weeks to sort this out. thatnk the eu will extend for a few weeks. the problem is we are not sure there will be any more clarity in the next few weeks. some are suggesting there are two routes to go, the u.k. should revoke the article 50 q that is complicated because it has been ruled by the court of
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justice that once you revoke it, you cannot put it back into place. we don't know. the u.k. can request the extension, all 27 eu members have to approve it. the french are certainly playing harder to make sure they understand why exactly this extension is required. what could happen if there is no extension, there is an accidental crash out on march 29 because the parliament can't at the its majority come eu does not want to provide an extension, and march 29 really becomes the hard brexit deadline we all fear. shery: thank you so much for joining us. heather conley, senior vice president and director of the year program at csi ask with the latest on brexit. the u.k. is not the only country trying to iron out a deal. the u.s. and china are still inching toward a trade agreement. republican senators are set to meet with president trump later today on the subject. here with more about what to expect is senior trade reporter
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sean -- shaun donovan. we have been talking about a potential mar-a-lago reading between-- meeting president trump and president xi p required we seeing this happening? there are we in the negotiations? shaun: welcome to the world of trade. these things move slower than brexit talks. hearing and we are seeing is the crucial end game seems to be upon us. the end game could last some said as rubber lighthizer yesterday. that meeting between president trump and republican senators which will take place in 90 minutes is part of the administration managing the domestic politics of this. it is not just china they will talk about. they will talk about steel and aluminum tariffs, possible auto tariffs. what might happen with eu talks and japan. clearly, there is a domestic political environment that trump needs to manage and that
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environment is pushing for a tough deal. at the same time, the chinese are keen to avoid xi jinping hopping on a plane and going to mar-a-lago and being embarrassed if president trump decides to do what he did in hanoi with kim jong-un and walk away from a possible deal. embarrassed,ing of it is perhaps unfortunate timing that we have the annual report on human rights by country today. pompeo is saying that china is in a league of its and, calling them out on human rights abuses. can it really be kept on related? how much of a slap will that be and may conversations more difficult? shawn: i think this administration and we have heard that from secretary pompeo today, has put less of an emphasis on human rights in its relationships with other countries. at the same time, that divergence highlights what we are the concerns in the occurrence -- in the security and diplomatic community about dealing with china and that is
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the military rise of china. aina as a rising superpower, long-term strategic rival to the united states. versus the shorter term issue of a trade deal. that tension is there inside the trump administration. it is they're all over washington. it is part of the reason trump needs to come up with a good deal with china if he is when to be able to sell it here at home. amanda: always great to have your thoughts. thank you for that. as we havel ahead, discussed, canada has grounded the 737s next eight and nine. that leaves the u.s. as one of the remaining holdouts. we will have more on that after this. this is bloomberg. ♪ erg. ♪
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shery: this is "bloomberg markets." i'm shery ahn in new york.
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amanda: i'm amanda lang in toronto. in of the big pieces of news this country today, but it is global in nature, the granting of calling max -- of boeing max eight and nine in canadian airspace. following many other countries. but leaving the u.s. and the federal aviation authority on the outside of what is now been the move to ban the planes. it is interesting. i want to show you a look at what boeing is trading. i wonder whether you think we have seen in the absence of new priced in.amage it seems to have leveled off from the worst of the last few sessions. shery: we are just coming off of the today lost --
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parts in red are actual sovereign states grounding the flights. the problem right now is not just the grounding of the 737s. what happens to new orders? we know 79% of boeing ordered backlog by units. and we are also hearing from norwegian air that they want compensation for having to ground their flights. this will continue to snowball. amanda: meanwhile, many experts expressing concern and a lack of understanding about the faa. listen to former ntsb. >> i think it is a huge mistake for both boeing and the federal administration. sending theally wrong message to the world, concerning aviation safety and our interest in maintaining our leadership on that issue. have aviation reporter ben katz with us.
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is this a matter of time before the faa has to move or can it remain in hold out here? ben: i think this is the critical issue. and the critical question. will the faa come under enough pressure in order for them to take their own decision to ground the aircraft in the u.s.? that would be a really significant take. and the european safety agency already taking these steps followed by so many countries, you have seen them up across the world deciding to ground these planes. there is definitely pressure building up on the faa. shery: any idea why the faa has taken an approach in its holding out? because there is so much criticism out there saying this will really hurt their credibility. is ai think this again really important issue to dig into. i think it comes down to the fact that in the past, the regulators find evidence first
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-- make sure that they are that they know what the issues are before groundings. some of the other regulators around the world, they think the similarities to the lion air crash that was a few months ago in october is efficient enough to warrant concern and enough concern to do the groundings. i think there is a question whether the faa is treating this ethiopian air crash as an isolated incident, as opposed to linking them and thinking of the potential for a trend here. amanda: one of the interesting things about this, if you can use that word, for boeing and the aviation authority, is it that more time passes, it harder it is to recent -- to reverse course? doing it immediately come a what have looked benign, the longer they wait, it looks like they have discovered something new and it raises more alarm. becausebecome too late, it would send the wrong message? ben: i think what we are
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watching now is what happens with the black boxes. ethiopia has retrieved the black boxes yesterday. they are discussing talking about sending it to your. they have approached germany, asking germany to look at that. as soon as the data comes out, if the faa were to answer the question, if the faa were to reverse course or take action, if the information from the black boxes shows a connection to what happened with lion air in indonesia, they will absolutely, i'm certain, take action that the others have taken. or at least give new guidance or advice. definitely, that is where we are keeping our focus now. what evidence and what information comes out of this black boxes. shery: we are hearing from norwegian air that they want compensation for having to ground these 737's. do we know at this point how big the business impact could be ongoing? -- be on boeing? this is kind of a fluid
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situation. we are not entirely sure yet what the actual cause is. of the ethiopian crash. only once we know whether or not boeing is responsible do we get into the question of compensation. norwegian is being clear, this is an airline that has been on the cusp of bankruptcy for the last few months. if not come even longer. cash, aroundaround the additional expenses is something that they cannot afford to wait for. i think that is why we saw them coming out early saying, knowing, if this is up to you guys, we are looking for compensation. but there is the bigger question about what this issue and the communication and handling of the issue has done to boeing's relationship with airlines around the world. there is a story on the terminal looking at the various airlines reconsidering their boeing 737 max orders in light of this event including lion air and indonesia which is being very openly -- very frustrated with
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how boeing has reacted to the crash in october. shery: thank you so much for that. ben katz from london with more perspective on boeing. coming up, credit fierce sinking to an almost five year low, even as the dallas fed wars of -- warns of poor liquidity. that story next. this is bloomberg. ♪
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credit marketing -- market seeing reasons to be positive, declining since december and january highs. this is federal banks warn about damaging downgrades. let's get a look into the upswing in credit with our reporter. a key pillar of this story is the fed turning dovish. what else are credit investors watching? a really big story people are watching now is the china and u.s. trade talks. that is the number one concern according to a bank of america survey released earlier in january.
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thatw this a narrative, people were worried about china and u.s. trade and obviously the fed rate hike stance. both have seemed to been subdued as far as the china-u.s. trade talks are concerned. it seems like people were expecting positive news. they are saying it is priced into the market. we are really looking for any news on that. be not just for a positive headline, but a real solidified trade agreement and that could continue the credit rally. if a negative headline could turn things around. thata: one of the things is so interesting about what is happening in credit is that we had great fears in certain parts of the market attracting attention, including parts being securitized in ways people are theing their leverage in system. we are seeing central bankers, fed heads out there talking about concerns about this. yet the market participants fears seem to have abated.
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is a driven by price because their returns have come back to them so they are happy to be a? kriti: absolutely. backing up and touching on the conversation about triple be touched ain the news, lot by bloomberg reporters and investors as well, that is a valid concern. it willwill see is that be more of a concern, if we do see the u.s. economy going to a downturn or recession. that is when those fears ramp-up, when the question of cash flow and the ability to pay back debt really emerges. along this rally has come with bond issuance as well which is rare. kriti: absolutely. those two are usually not necessarily inversely correlated but not something easy happen at the same time. what we are seeing is a borrowers market. we are seeing companies issue debt at favorable cost. they are hoping that this will continue. amanda: we will have to leave it there.
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thank you so much for that. for bloombergr users, you can interact with the thets you have seen, using function gtv go. you can catch up with anything you have seen on your bloomberg screen and television and a see the analysis that goes behind it. from toronto and new york, this is bloomberg. ♪
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mark: british prime minister theresa may is not giving up on her brexit plan despite two defeats in parliament.
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lawmakers will vote today on whether to leave the eu in two weeks with no deal in place. the other option is to delay brexit in the hopes of giving better terms. the prime minister has warned that a delay could lead to a second referendum on the issue or no brexit at all. u.s. aviation safety officials versus the world. the federal aviation administration standing by its calls not to temporarily ground the boeing 737 max following the second crash in five months. have joinedd india other authorities grounding the plane. you the appeal will send the cockpit data to europe to be analyzed. officials will send the cockpit data to europe to be analyzed. state county court read the sentence to a

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