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tv   Bloomberg Markets Americas  Bloomberg  April 26, 2019 10:00am-11:00am EDT

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york, 3:00 p.m. in london, and 30 minutes into the trading day in united states. from new york, i'm vonnie quinn. guy: from london, i'm guy johnson. welcome to "bloomberg markets." vonnie: high-frequency economic data. the university of michigan reading for april, building on that strong gdp number, 3.2% in the first quarter. that came in a little bit earlier. we will talk about inflation, core pce quarter over quarter just a little bit less than what economists were looking for. 10 year yield creeping back up 2.50 earlier on. some selling, clearly, and u.s. equities. the dollar index is down today. $98 for most above
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of the session so far. intel down, dragging tech stocks lower with it. some are saying this is just a pause in the chip cycle. 2.1 percentwn despite some silver linings in its corley report. in just a few minutes, we will speak with the ceo kevin johnson after that earnings report did show solid growth in the u.s. and china. guy: one of the big factors affecting european markets today is what is happening with the price of oil. crude trading up sharply. we've seen some fairly big clips going through in terms of what has been going on to the downside. people are selling crude. down by 2.14% at the moment. that is rippling through into some of the commodity stocks in europe. major oil stocks trading lower. that is a big chunk of very heavyweight names. big dividend names as well. we also got miners trading
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lower. the theme about the global slowdown is still absolutely represented out there. take a look at japanese industrial production data from earlier in the session. marriess up with -- it up with what we have seen from korea and other countries over the past few days. that is what is happening. stocks going nowhere. brent definitely down. also seeing movement in the german ten-year. that probably followed from the u.s. gdp number, which came through. you've got to kind of break it down, strip out the inventories, take a look at the trade numbers, and critically, take a look at that pce number. very weak for that inflation story, but decent growth being represented. that is pretty good from a fed perspective. nevertheless, we are seeing movement in the treasury market and german bund market. vonnie: back to the ipo market now. what will be this year's largest
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uber, is aiming for an $84 billion valuation. joining us is men deep sing -- is mandip singh. does this have to do with lyft? reporter: it makes sense for them to go with a conservative valuation. if i compare them to a company like flag, which is also going you know when they hit $1 billion revenue, it will be profitable. i think they are right to leave some room for these talks to go prices, and this seems to be reasonable. guy: travis kalanick, let's talk about him. would this have been possible under him? he's checking out a number of shares as a result of this.
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this is a proper company now that is on the public markets. it is a big step forward. i just wonder whether or not you think this would have been possible under his leadership. mandeep: i can't imagine how this company would have gone public under travis. yes, it would have happened, but i think that is where the new expertise comes in, the experience with expedia and how he kind of took the company from to where it is now. i can't say what would have happened if travis was there, but my sense is dara has the expertise to really manage this company. vonnie: the loss we found in the s-1 was $3 billion in 2018. that brings us to a total of, what, $10 billion in three years?
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what will they do to offset some of that operating loss? mandeep: uber is spending a lot on food delivery. they have scaled back on ridesharing, but they are really trying to scale this business as fast as possible. of $2around a rate billion right now. what we found out based on the filing is they are giving up 50% of their revenue as driver subsidies. just 1% of the revenue is going to writer subsidies. scalere really trying to these ancillary services to get this platform effect. for now, they don't have a good roadmap as to when they will positive.gin guy: why are they coming down the direct listing route? i assume it is because they don't need a big influx of cash
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as a result of this. i get there's probably some other consequences as well. existing shareholders can probably sell out a little quicker as well. walk me through the mechanics of why it is happening this way. slack has hid that inflection point of $400 million revenue. they know they are able to scale this to $1 billion easily. now it is about raising your profile and partnering with other companies in the enterprise sector, and the cloud, one of the things you will see is it is such a remarkable, pretty double model predictablerkable, model that once you have that customer base, you can easily upsell as you partner with other enterprise software companies. the ipo really helps slack build up that profile. vonnie: got to leave it there. mandeep singh, thank you.
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let's check in on the bloomberg first word news. u.s. economy grew faster than expected in the first quarter. it beat all forecasts in a bloomberg survey calling for two point 3% growth. the economy got a big boost from inventories and trade. that offset a slowdown in consumer spending. president trump meets with japan's prime minister shinzo after trade talks resumed between the two countries, focusing on agriculture and vehicles. the u.s. wants to reduce its trade deficit with japan and once greater access to the agricultural market. japan once a promise it won't be .it i auto tariffs north korea's kim jong-un is warring that the current
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d'etante is at risk. he told vladimir putin at the dispute with the u.s. could return to its original state. ford says the u.s. justice department is beginning criminal investigation into emissions testing. the automaker says it is cooperating, but can't say what the outcome will be. and in missions scandal has haunted volkswagen for years -- an emissions scandal has haunted volkswagen for years and cost it billions of dollars. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm renita young. this is bloomberg. vonnie: thank you. coming up next, we are going to be talking with starbucks ceo kevin johnson about the company's latest results and his strategy going forward. this is bloomberg. ♪
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♪ guy: live from london, i'm guy johnson. vonnie: from new york, i'm vonnie quinn. this is "bloomberg markets." holdingrbucks' growth strong in chinese and u.s. markets. david westin is joined by the company's ceo. david: thanks so much. kevin johnson, the ceo of starbucks, we had the earnings out after the bell yesterday. solid report. start with the united states. how did you do in same-store sales? how much was traffic, and how much was the price being charged? kevin: first of all, we had
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another solid quarter. really aboutle is delivering predictable, sustained results. this is another quarter that reflected that. in the u.s. we grew our collectibles. we saw slightly positive growth in transaction comp. the rest has been driven by slightly positive transaction premiumization and attach. david: how much of that is the changes you are making in the menu? you're shifting over to cold beverages, for instance. we are a beverage first company, so the beverage innovation we drive is a key part of the agenda. if you look at what we've done over the last few years, cold beverage present a little bit over 50% of our beverage mix versus hot.
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certainly our cold brew and nitro cold brew are key drivers of that. we have nitro cold brew in 50% of our stores in the u.s., with the plane to get fully deployed by the end of this fiscal year. we've also innovated around our espresso platforms as well. the cloud maki otto we launched last month -- cloud machiatto we launched last month has been a big success. it is also driving that continued improvement in transactions. david: it is also about how you get the beverage. obviously you moved online. you can order now online. how much has that improve your performance, and for that matter, are you going to delivery? in the retail segment today, the two transformative elements of modern-day retail are retailing in stores and extending to a
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digital relationship. through our rewards program, we have seen a significant growth in active rewards member. we posted 13% growth in active rewards members to 16.8 million in the u.s.. rewards members accounted for roughly 41% of total tender in the u.s. we've expanded beyond mobile order and pay to enable starbucks delivers. we now have starbucks delivers in the u.s. in roughly 1600 stores, continuing to grow and learn and tune that experience to customers to deliver a starbucks quality delivery experience. so delivery, mobile order, and digital is a big part of our agenda. david: it is also about china, which is been a very big driver for you. take us into what your experience is in china. where are you going in china? how much of your gross is adding stores, and how much is adding more sales in existing stores? kevin: china is our second
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largest and fastest growing market in the world. the u.s. and china are the priorities we have called out strategically. this quarter in china, we grew our store footprint by 17%. build 16 newath to stores in china every year. those new stores are performing financially better than prior generations, so great reception to the new store growth. our same-store comparable in china also accelerated at a 3% annual basis. we are super pleased with the fact we are seeing continued stores,wth in existing but complement that with 17% store growth in china and the total transaction growth is significant. we are very pleased with that. david: you have a competitor in china now. how is that affecting your business? how do you expect it to affect you going forward, particularly on margins?
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kevin: we've always had many competitors, since starbucks was founded 48 years ago. now we are at over 30,000 stores globally. we've always had a lot of competitors. china is no exception to that. the fact that there is a large and growing market for coffee and china means we expect more competitors to come into that market. certainly for starbucks, we've been in china for 20 years, and we really understand what makes a differentiated experience. the combination of what we do in our stores, the quality of our coffees, the handcrafted nature of our beverages personalized to our customers, and he connection that our partners make with customers is very important. you put all of that together, and we have no extended that experience in our stores to a digital mobile relationship. we signed a china digital partnership agreement with alibaba that was announced last august. the digital reach we are getting in china is significant as that
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partnership continues to expand. we feel very good about the experience we are creating in our stores, the performance of those stores, and the digital reach we get with china. i think we are well-positioned positioned for long-term growth in that market. david: we don't hear as much about europe. tell us about the nestle distribution deal. how is that coming? kevin: our global coffee alliance with nestle is a significant one because it brings the starbucks brand to food services, cpg channels, and brings starbucks coffee on the nespresso platform. in march we announce the first 24 on those platforms. we are coming into 16 new markets around the world through september. in the next wave, we are going to another 31 new markets. nestle is significant. this got 5 million points of presence in just about every
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market in the world. our partnership with them is really anchored around coffee, anchored around a common set of values, and really leveraging the nestle reach and strength to bring starbucks coffee to retailers, mass merchants, food services, and the world's most popular singleserve platforms with nespresso. david: you've got a remarkable position as head of starbucks. it strikes me that there is one thing that is almost unique about you, which is that your predecessor is running for president. with your experience of running starbucks and knowing howard schultz pretty well, what qualities does a ceo have it help in the white house? have that might help in the white house? kevin: howard transferred from starbucks last year. the leadership team here are staying very focused on running the business of starbucks. we are very pleased with this quarter.
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as the united states gets into this presidential cycle, we've been pretty clear that we stay focused on the business of starbucks, and we will let citizens comment on who they think ought to be president and why. youd: yeah, i didn't think were going to endorse or not endorse everybody. that's fair enough, kevin. [laughter] interesting stuff. i wonder what coca-cola is going to do with its coffee business now, and what that could mean for starbucks. vonnie? vonnie: we certainly did ask the ceo about it the other day. let's check global markets now with abigail doolittle. abigail: there's a bit of a risk off tone on this friday. take a look at the s&p 500 and nasdaq in the u.s., a small pullback. europe, the ftse 100 down about 3/10 of 1%. it all started in asia.
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the shanghai composite down for a second day, down 1.2%, having its worst tumble of the year. again, a bit of a risk off tone. really behind it here in the u.s., take a look at the stocks in the u.s. stocks indrop for the more than a month. some of the big decliners including intel. yesterday they beat first quarter estimates, but shares are on pace for the worst day since 2008 after they cut the outlook around data center weakness. that is rippling through the chip space. xilinx also had a disappointing quarter. what we are looking at here is a year today chart of the shanghai composite invite, and yellow the s&p 500, and purple the dax, and the emerging-market index.
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be interesting to see what the next session does bring. we may have a bit of a choppy trading week ahead, or next couple of weeks. something to keep in mind from a global dynamic flow. vonnie: thank you for that. still ahead, u.s. gdp numbers were a blowout. was it really as good as all that? we were looking to the details in the moment. this is bloomberg -- we will look into the details in a moment. this is bloomberg. ♪
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♪ vonnie: live from new york, i'm vonnie quinn. guy: in london, i'm guy johnson. this is "bloomberg markets." vonnie: it's time now for our etf friday moment. hedge fund usage of etf's is on the rise. q2 tell us more is james cyprus
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-- here to tell us more is james cyprus. what do we mean when we say it is on the rise? james: you have to look at gross positioning. typically we look at longs, but etf's are actually net short, so they have had $61 billion of positioning, according to goldman sachs, as of the end of 2018. $90 billion of that is net short. they actually guess that somewhere around 80% of the short positioning on u.s. etf's is coming from these hedge funds. this kind of speaks to the misunderstood nature of hedge funds. they are often going for risk-adjusted return, and will short these to kill beta and search for alpha or those idiosyncratic risks they are investing in. guy: they are hedge funds, after all. which ones are leading the way? james: bridgewater is the biggest, and they fall under the first category of what we found, these allocators.
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they create portfolios or use these etf's for portfolio completion, just to top off exposure. the second way is where they just hold one or two super liquid, super large funds and fund.em as a liquidity -- isird is etf markets etf markets. etf's: what kinds of could retail investors hop the trade on? james: hedge funds are using the most liquid for the largest etf'sfunds -- the largest that are known to be traded heavily. more recently we have seen somewhat smaller, somewhat more liquid funds. shares slipped into the top
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five, half the price of spy. hedge funds being able to give up some of that liquidity to save on cost. vonnie: we will leave it there. always a pleasure. withis james bloomberg intelligence. still ahead, we will be checking the markets. right now fractionally march or. we will speak to the -- fractionally shorter. we will speak to the intel ceo. this is bloomberg. ♪
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♪ vonnie: live from new york, i'm vonnie quinn. guy: in london, i'm guy johnson. this is "bloomberg markets." japanese prime minister shinzo
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abe arrives in the united states today. the president and prime minister will be playing golf and talking about trade. talks between the two countries are ongoing. the question is, which way are they going? let's bring in eurasia group's head of research operations from washington. these to get on pretty well. they are going to be playing a little bit of golf. does this relationship help abe get a deal done? meredith: it certainly does improve the atmosphere. that personal list chip with this particular u.s. president is important to getting key decisions across the line. during this trip to not only invest in his relationship with president trump, but also try to avoid any kind of this agreement. keep in mind president trump is looking to visit japan at the end of may. he's going to be back in japan at the end of june when tokyo is hosting the g20 summit. abe also has critical upper
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house elections in july. it is very important that the trip go well, and any potential u.s./japanese trade talks coming out of this meeting is also on the right path for him politically. guy: what is the right path? what is the most likely outcome in these talks? when you think we will get a result? meredith: certainly not an early harvest result by the first half of this year. more likely come our base case scenario is that you are going to see a limited trade deal before the end of this year. probabilityng 45% on that. we do think that you're going to see a limited trade deal for the end of this year that will
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expand u.s. access to japanese andets for ag exports, exchange for an exemption for japanese auto exports from potential u.s. auto tariffs. keep in mind, president trump must decide on the use of no auto tariffs next month. that is a significant date that prime minister abe has in mind as well. vonnie: obviously there's going to be a lot of signaling going on here as well. the u.s. is going to be signaling to other asian nations , thinking about china, clearly. abe is clearly signaling, too. we just had a kim jong-un and vladimir putin meeting on the others out of the world. what are the messages each leader will be trying to send to other messages? meredith: watch for them to compare notes on china and come up with some sort of language that would double down on their commitment to address the
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nuclear and security threat posed by north korea and the region. beyond that, we don't expect a complaint a breakthrough on any of those talks with the leader. is managing abe delicately, this relationship with trump at a time when many theapan are questioning depth and commitment of the relationship. , what wego well today would expect to see is perhaps trump and abe giving their blessings for some kind of trade framework, a roadmap resented to them by ustr lighthizer where you would see a list of the topics that have been agreed to be covered, as well as a time by which these negotiations would take place. if, for example, president trump is going to raise sensitive issues in the relationship, this
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would be difficult for prime minister abe and give us a negative sense of how this really chip is going to evolve moving forward. completes abe free to a completely bad are -- to negotiate a completely bilateral deal with the u.s.? actually, watch this space closely because prime minister abe certainly has not given up on trying to convince trump's washington to eventually sign onto what is considered the new economic elite club of the 21st century global economy. this is not an argument that trump's washington is willing to take on now, but abe and his trade talks is looking to prepare a pathway to keep the coming back to the tpp if it decides it is in its interest
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to do so. the other countries are supportive of those measures. guy: meredith, i think the spanish stockmarket is the worst performing stock market in europe this year. . is this weekend's election going to provide another reason to sell. meredith: the reason why you have such a negative performance is this is the third general election in just four years. according to our base case, we could be heading for a fourth general election in as many. at this point in time, eurasia group sees the incumbent socialist party led by prime ministers sanchez most likely to secure the largest number of , but the performance will not be enough to where he's able to have a successful coalition government negotiation. we see unsuccessful coalition
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talks which will last probably into june. keep in mind the parties will want to wait and see how they perform in late may. unsuccessful coalition talks will expand into june, but then essentially they will not be successful in forming a government. we would actually expect that the socialiste party wildly outperform expectations where it would be , we do see atmiss this stage unsuccessful coalition talks that would likely read to -- likely lead to a repeat of general elections this autumn. guy: it is amazing how polarized this situation is at the moment. let's talk a little bit about brexit. the president is going to be visiting japan. he's also going to visit the u.k. very soon. trip is anyway influencing theresa may's thinking? if trump turned up and said we
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are going to do a trade deal, that might tip the balance a. little bit. -- balanceheresa may a little bit. theresa may is looking for any little imbalance to get her deal through taylor: -- to get her deal through. we've been watching that relationship closely, and for an alliance relationship that traditionally has been so close, i think it is safe to say that from mr. may and president trump -- prime minister may and mr. trump, there is some rebuilding to do in that relationship. some of the statements have not been helpful for theresa may up to this point. innie: will we see u.k. european parliament elections? [no audio]
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meredith: -- into those negotiations, but we haven't seen sufficient progress yet to give us confidence that the u.k. will be able to avoid those critical eu elections. as such, the prime minister's leadership position is looking ever more perilous at this point. always, thank you. meanwhile, u.s. economic growth accelerated more than expected in the first quarter. a big boost from inventories and trade offset that slowdown in consumer spending. exactly how healthy is u.s. gdp growth? here with the answers is michael mckee. taking from the second
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half? michael: we are, and we are not. insumer spending really fell the first quarter. we notice that in january, the payoff from december when everybody shut their wallet, but ak was thet we inventories and trade numbers. see the biggest change since 2014 from those because what happened was companies bought stuff ahead of the trade wars, and stockpiled it. we saw a big rise in inventories . does subtract from growth in the second quarter. we will see if the consumer comes back and offsets that. guy: this was meant to be the weakest quarter of the year. we can't keep doing this, can we? michael: we can. gdpissue is whether the
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report can fix some of the seasonality problems we've had in the first quarter. every first quarter has been weak for years, and they have been working on it, trying to get some of those gremlins out of the data. it is hard to know exactly. this was certainly a change from what we have seen in the first quarters, but we also have these weird patterns with inventories and trade that haven't come up before, haven't come up for years. we won't know until we get through the year and see what the rest of the year brings. president makee a out of this number? michael: you are asking me if donald trump take credit for this? [laughter] michael: donald trump is going to make a big deal out of this, obviously. any politician would. it is the economists and the traders seeing through the numbers. if you look at what the inflation numbers in the report show us, a big collapse in
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inflation, 1.3% on a core basis. that scared people on wall street. what we are seeing now is bond yields falling because people are beginning to price in more rate cuts on the back of that. these are quarterly numbers, not as accurate as the monthly numbers, which we get next week. the fed is going to be watching this closely. if that continued, you might be pricing in a rate cut, but re-member what happened in the middle east. we are seeing oil prices rise, so that is going to take some of the sting out of that. it is too early to price in a rate cut. number?this a good the pce number is light, 1.3%. that is below where the fed would like it to be. you back out the inventory, backup betrayed. what are we left with here? michael: we saw weak consumer spending.
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is it first quarter seasonality, or did we really see things drop off? if that carries through, we should see a rebound in consumer spending. the rest of the year could be better. it is kind of hard to get a clean read on it, so right now .t is what it is, 3.2% the question for the fed is what happens with inflation. vonnie: thank you as always. year'sming up, it's the largest ipo. of course, we are talking about uber's valuation. this is bloomberg. ♪
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guy: live from london, i'm guy johnson. vonnie: from new york, i'm vonnie quinn. this is "bloomberg markets." on ipo's, we get more details from uber and slack. joining us from san francisco is reporter.s slack has more than 10 million daily active users at the end of january. only 88,000 of them are paying. how does slack and to become profitable? reporter: that's right. this morning, slack dropped its s-1, giving us insights into all of the financials they have been hiding for many years. a great time to see below the
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hood here. i think what is remarkable about this is that the revenue doubled in the last year. we are looking at $400 million in revenue with a net loss of about $140 million. the year prior it was about $220 million of revenue. to answer your question, they are definitely on the path to profitability if they are growing at that rate, doubling the revenue year-over-year and keeping their expenses exactly the same. guy: how much do people buy into slack in the recent rounds when it was a private company? what pick are we seeing here as it transitions to the public sector? their valuation has grown from $7 billion in august two about 15.6 billion currently does the shares most recently traded at about $26 a share.
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again, a lot of demand and interest in this company. one thing i really want to point out is that this is a direct listing, not an initial public offering. if they don't rely on underwriters and banks to ring the stock to the public markets, they simply list a share price on listing day and allow a pure exchange of the shares on that day. it is really important that they get a sense of demand leading up to the initial public offering, and they do that by opening the market for secondary shares, allowing their early employees and some investors to sell secondary to gauge the market for price. what they are seeing is that there is demand and interest around $23 a share, $26 at the highest. that is what we should expect to see slack go out at on listing day in about 30 days. vonnie: such an interesting way to do things, and sources have been telling bloomberg that slack says it's because it doesn't need the cash or the
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publicity. is that true? if it doesn't need the cash, why even list? olivia: exactly. there are a couple of reasons to go public. you want the publicity, you want to have a publicly traded company because it is easier to purchase other countries so you have a stock price -- purchase other companies so you have a stock price you can pin your value to. a direct listing is this unique way of going public, but you are not issuing any new stock, and you are creating liquidity for your shareholders, but not creating dilution, which comes when you create new shares. i think this made a lot of sense for slack. they have a lot of money sitting around. they don't need extra capital. they don't need to sell more shares. guy: it is also easier for those that are in get out. olivia: right. there is no lockup. guy: exactly. let's talk a little bit about
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uber. let's talk about how this is likely to go. what is your sense of the valuation they are putting on it? is it posing a question for the markets, or did you think the market is ok with it? olivia: that is a great question. what we found is they really came out quite conservatively. they had a share price range they announced from $44 to $50, which is quite conservative compared to what people were talking about several months ago. that is about an $84 billion valuation. previously they were talking about $120 billion valuation. quite conservative there. i think that is just the market response to the fact that their growth has slowed and they are seeing some interest, investors questioning uber eats' growth at the moment. still a lot of interest in that business as well.
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vonnie: olivia, thank you. guy: still ahead, we are going to be talking about oil. oil is being battered this afternoon. brent is down by 3% come but wti down by 3.5%. that's next. this is bloomberg. ♪
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♪ guy: from london, i'm guy johnson. vonnie: in new york, i'm vonnie quinn. this is "bloomberg markets." guy: it is time now for our stocks of the hour. big oil a big focus. chevron beating estimates, while exxon stumbled, posting its biggest refining lost in 17 years. emma chandra is here with more to find out what is going on. let's start with exxon.
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emma: there was a big miss. atnings-per-share came in of5 versus expectations $.78. they also saw production below 4 million barrels a day. refining really the weakest part, putting in its poorest performance in 17 years, a lost of $256 million, equivalent to $3 million a day. stockpiles a gasoline hurt margins, spending a lot on overhauls and repairing various refineries. one analyst really calling it a shocker. vonnie: of course, chevron also reporting weaker refining results. emma: they did. they also saw downstream results coming in less than expected. they did better than exxon, which is why we are not seeing the shares under quite so much pressure. the outlook for the refining business for both companies is better into the second quarter. chevron also missed daily
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production estimates, but earnings-per-share beat. a bright spot for both companies was the permian. both exxon and chevron reported strong growth in the permian. exxon's permian output is outperforming their own target, one of the key strategic priorities. the big question for them this week is whether they can hold onto that deal that they made to buy anadarko, which was all about expanding its permian e, but of course occidental has put in a rival bid. chandra,hank you, emma with r-star of the hour. it is time for futures -- with our stock of the hour. it is time for futures in focus. we are joined by phil from the cme. are we in this trading range for a while? phil: i think we will be stuck $60 and $70
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range. if you look at the supply side, we had a big boost in supplies this week. i think next week we will start to see those tighten backup in-line line with the five-year average. one thing i am watching is , the national average $2.83. they are continuing to creep up, and gasoline is going to be a shocker for a lot of people out there driving. vonnie: we are talking about the refining and the weakness in some of the companies that reported today. what else are you watching at the cme today? phil: we were kind of surprised we didn't see much more reaction to the gdp report. if you look at the deflator, that was a big miss. the fed has a lot of work to do for itself. we are seeing a robust economy, but no inflation out there, and i think that is why we saw gold prices reverse off that low. vonnie: exactly.
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yield 2.4982 right now. thank you for joining us from the cme. later this hour, we will talk aboutntel ceo bob swan the company cutting its revenue forecast as the stock absolutely tanks in trading, bringing some of the other chipmakers along with it on the philadelphia stocks index right now. it is down 1.6% off its lows of the session. nevertheless, the nasdaq the worst performer of the indices, mainly on those chip stocks. this is bloomberg. ♪
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♪ guy: 30 minutes left in the
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european trading day. from london, i'm guy johnson. vonnie: in new york, i'm vonnie quinn. this is the european close on "bloomberg markets." guy: oil is getting battered this afternoon. take a look at what is happening with brent. we were just talking to phil struble at the cme. crude certainly under pressure. that is rippling through into european markets. some of the big oil makers have been down for a few sessions now. they had a big start to the weeks since they are very tough going. european markets feeling that a little bit. he flat at this stage come up right at the bottom of the market, the european oil majors are going to get hit. mining stocks also down. states prettyited interesting. pce highlights this idea that the fed is going to be on hold.

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