Skip to main content

tv   Bloomberg Markets Americas  Bloomberg  April 2, 2020 10:00am-11:00am EDT

10:00 am
york this thursday, 3:00 p.m. in london, and 30 minutes into the trading session in the united states. from new york, i'm vonnie quinn along with my cohost guy johnson in london. this is "bloomberg markets." a lot of data to look at today. here it is, x transportation. reading for that. durable goods orders is also coming in exactly as the previous reading for the final data in february. this is pretty irrelevant. it is february data. we are obviously looking to the march and abril data -- and april data for a reading of the economy. we got unemployment filings of 6.4 8 million. means we are looking
10:01 am
at a 10% plus number for on them limit on friday. the dow jones is down zero point 3%. the s&p is positive by just a point. the nasdaq is down by four points. very little movement right now, at least around these indices. the dollar index is stronger today at 100.18, as the said continues to -- as the fed continues to invent ways to get money into the economy, the latest to get banks to breach their leverage ratios. what is going on in europe right now, guy? guy: as you say, the dollar is creeping up, which means the euro is going down. the euro a big component of the dxy index. the dollar regaining a bit of traction right now despite the fed efforts. european stocks down by about 0.6%. the only sector in positive territory is the oil and gas
10:02 am
sector, given the climb we are seeing in crude prices. brent is up by 5% on expectation for the president that a deal can be done between the russians and the saudis. euro-dollar now with a $1.08 handle. down at the bottom, you've got a bit of an offer today when it comes to the german ten-year. the german government now indicating they will see a potential 5% contraction when it comes to the german economy this year. vonnie: let's get to michael mckee now, who joins us to talk about jobless claims the fed programs. michael mckee is the international economics and policy correspondent for bloomberg news. this is greater than any surge we have seen in history. michael: there's no comparison. there's no way to even put it in historical context. 10 millionot about additional unemployed people whiche had two weeks ago,
10:03 am
implies we have gone from a 3.5% of them limit rate to about 10% in two weeks -- three point 5% unemployment rate to about 10% in two weeks. show up in the numbers tomorrow. income won't drop as that would imply, but will the economy suffer? probably, because even if you are getting the money, a lot of people will save portions. they will pay their rent and buy food, but not do a lot of the discretionary stuff over the next couple of months. guy: perversely, this number is really good news. hear me out on this. the automatic stabilizers are taking in. states are able to process high volumes of people coming through their doors to make these claims. that means the system is working in a way that we want it to.
10:04 am
i appreciate you got to look really hard. actually, it is quite a good number in that at least the money is getting to the people that need it. michael: well, we certainly hope so. there are anecdotal reports that a lot of people are still trying to file and running into problems. the states didn't ever anticipate anything like this. the offset to what you're saying is that somebody has to pay those additional unappointed benefits. that is going to put a hole in state budgets and the federal budget. hopefully the government is going to pick up most of that, the federal government, so that the state budget deficits don't get any bigger. the real question that comes out of all of this is when the virus goes away, how many of the people on unemployment now are going to have jobs to go back to ? that puts the focus on the business assistance programs that were -- that congress
10:05 am
passed. vonnie: i think the only silver lining i saw was the comment that this is necessary to save up to 2 million lives. that was the only positive offset i could see. talk to us about the new fed program freeing up banks from the lending ratio shackles. michael: to put simply as possible, the leverage ratio compares your assets to your capital, and it came in after dodd-frank. treasuries are counted against that, even though they are theoretically risk-free. now the fed is asking dealers to take on a lot more treasuries as part of repo operations and is part of these lending programs. so the fed is saying you can relax those for the next year bonds,asuries and agency
10:06 am
not for anything else. that should enable banks to take more risks to be able to put these things on their balance sheets help put the fed in its transmission policy. vonnie: michael mckee, the fed whisperer for us, thank you. let's check in now on the bloomberg first word news. here's viviana hurtado. viviana: china rejecting the u.s. intelligence community claim it hid coronavirus numbers. five agencies concluded that beijing under reported both total cases and deaths from the disease. china's foreign ministry says u.s. officials just want to shift the blame. now to capitol hill, where senate majority leader mitch mcconnell would move slowly on considering a fourth stimulus bill. senator mcconnell telling "the washington post" he would ignore efforts by nancy pelosi to get talks going. he says he is concerned about how congress would pay for another wave of spending. spain reporting its worst day
10:07 am
yet in the coronavirus pandemic. there were 950 fatalities in the last 24 hours. that has pushed the death toll past 10,000. spain now has more than 110,000 confirmed cases. it is the second-most severe outbreak in europe after italy. the price of oil surging today. china plans to start buying up oil for its strategic reserve. president trump says he thinks saudi arabia and russia will resolve their differences to ease the price war. in the first quarter, oil plunging 66%. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm viviana hurtado. this is bloomberg. much,hank you very indeed. let's take a look at where we are with markets around the world. the buck is catching a bid. this may just be re-highlighting some of the strains within the system, and the fact that maybe the fed's actions have not gone far enough.
10:08 am
that is causing a little bit of concern in stocks today. stocks and negative -- stocks in europe are negative. in the states, they are coming off earlier highs. euro is af which the big component, is trading up by 0.5%, back north of that 100 line, which is a big line in the sand for the market. we will carry on with the fixed income coverage in just a moment. this is bloomberg. ♪
10:09 am
10:10 am
♪ vonnie: live from new york, i'm vonnie quinn, along with guy johnson in london. this is "bloomberg markets." the number of americans playing for an benefits more than doubled to a second straight record, highlighting the devastating impact of the coronavirus pandemic as
10:11 am
shutdowns widen across the country. for more on that and the treasury market, we are joined by bill o'donnell, citigroup global markets managing director and expert on the treasury markets. bill, the last few weeks, explain how they have change the treasury market for somebody who has been trading in this and watching it for a couple of decades now. know, it wasou just a few short weeks ago that our treasury market was suffering from some huge dysfunction. that was before the fed announced a lot of the recent acronyms that are credit support programs, as well as their willingness to expand quantitative easing and their balance sheet to essentially unlimited levels. as they stepped into support the u.s. treasury as well as the mortgage-backed securities dealer that relieved balance sheets, and of course,
10:12 am
those balance sheet's were shrinking as the biggest banks were going into quarter end. it was a perfect storm for the banks. it was a perfect storm for the treasury market area but the fed has stepped in and they've become a shock absorber, and have definitely returned dealing conditions back to a semi-normal state again, including with the actions last night to loosen some of the regulations, as one of your prior speakers mentioned. vonnie: exactly. the leveraged loan ratio that banks now don't need to meet, it's been widened. more,s the fed need to do or is this just a matter of time , a waiting period until things get back to normal in the treasury market and liquidity conditions are more healthy? i think there's a lot more to do. certainly, we have been seeing waves of secondary supply hit
10:13 am
the treasury market. that's come from a multitude of different sources, from deleveraging among investor entities like hedge funds that have thrown a lot of treasuries into the market, central banks sellingn heavily, as evidenced by the collapse in the fed's own holdings, and we have also seen anecdotes and evidence of a lot of asian players, especially japan, coming into their march 31 year end, crystallizing long-term gains and a lot of their bond holdings, including treasuries, that have put new supply on the market. but then you also have to consider the primary market supply that has already started to pick up in the t-bill market. we end many others expect coupon supply to start rising substantially in order to fund all of these support programs that congress and the white house have approved.
10:14 am
that thatk significant increase in coupon supply could come as early as next month, and therefore, i think the fed will certainly have to play a role in trying to absorb a lot of that supply potentially on their balance sheet, either through continued qe purchases, the possibility of maybe a new operation twist if the curve starts to steepen because the backend of the curve doesn't have the same kind of support from the policy rate that the front end of the curve has, and possibly even enacting rate caps if the situation at the long end of the curve gets out of hand. if it does get out of hand, the concern of the fed would be household long-term loan rates and those for corporations will rise and potentially damage any kind of recovery in the future. let's talk a little more
10:15 am
about the front end of what is happening here. what we are certainly witnessing credit.tch of shorts on a bunch of european companies are urging the ecb to frontload its purchases of short-term credit right now to improve the liquidity situation. is that the gap in the market right now, the front end of the credit curve? what needs to be done to address it in the united states? well, the fed has already taken some steps both with the money market funds, as well as commercial paper and presumably the cd market, and a sickly blown the dust off of prior -- and basically blown the dust off of prior crisis era programs to step in and act as a buffer for those markets to keep them functioning, at least on the
10:16 am
private side. so the steps are there, and i think we have now started to see at least a little bit more stability in the all-important libor-ois, as the market begins to anticipate the beginning of the launch of these programs and others that are hopefully going to get these private markets, especially in the front end, functioning once again. so the fed has taken aggressive reallyand now it is just down to timing. if i'm not mistaken, beginning next week, a lot of these programs will be launched. i wouldn't be surprised at all to see the credit markets in the front end start to function a lot better in the days and weeks ahead. say, we are starting
10:17 am
to see some stabilization now. we've got the move index up on the screen, trading at 83. i think the long-term average is something like 65 over the last five years. would you be selling volatility right now? would you expect these markets to calm down even more? does the current 83 look a little high to you? guy: yeah, and for many of the same reasons that i said at the outset. if you look at implied volatility levels, which the move index does essentially contain, implied vol levels have come off the peaks we saw roughly a week or so ago. but i think there is more downside risk, and i say that simply because what i see in our is that baseets interest rates were treasury rates appear to be hot in this -- appear to be caught in this.
10:18 am
you have the supply i talked about hitting the market. on the other hand, you have the secondary market supply, but also primary market supply like bill issuance and coupon issuance coming down the pike. on the other hand, you have the fed and the balance sheets in the middle standing as a shock absorber. the outcome we for see for u.s. base rates or treasury rates is that they are going to remain range bound, very similar to the kind of tight ranges that we have seen this week. that should act as a notable depressant on implied volatility levels, so i wouldn't be at all surprised to see indices like the move index move even further south from here. vonnie: you have said the fed has been acting as a shock absorber, and it's been useful and has stabilized things to an extent. what are you worried about that is coming down the pike, potentially? where are the corners of the
10:19 am
market or the actors that might be in trouble? bill: i'll stick to my own homework at the u.s. treasury market. i thickets going to be very interesting to see whether the fed, with their balance sheet and their qe, i.e. the treasury and mbs purchases we've seen every day now, is going to be enough to absorb the primary market supply coming from the u.s. treasury themselves. so far, the demand for bills has been off the charts, so this massive increase in bill issuance in recent days has been readily and easily absorbed. it will be very interesting once they start to list coupon supply if the feds to see , via operation twist, and potentially even via
10:20 am
imposing rate caps, is going to be needed down the road. that is what we are going to be focused on. it is next month's business at the earliest to see what treasury is going to do with coupon supply. but that is coming down the pike . these programs have to be funded. treasury supply has to go up. it is just going to be very interesting to see what happens when that supply hits longer duration space and what the fed response to it is in order to keep base rates contained. vonnie: bill, amazing as always. our thanks to you. that is bill o'donnell, citigroup bubble markets managing director and treasury strategist. coming up later on "balance of power," we will hear from vice president mike pence on the latest on the coronavirus pandemic. this is bloomberg. ♪
10:21 am
10:22 am
10:23 am
guy: from london, i'm guy johnson, with vonnie quinn in new york. this is "bloomberg markets." let's hand things over to kailey leinz. kailey: of course, we are coming off the worst start to a quarter ever yesterday, and today we are trying to rebound, though it is not a very firm rebound. at the moment, we are higher on three major averages in the u.s., between 0.6% and 0.8%, perhaps getting a bit of a lift from crude, up more than a percent today as china looks to boost stockpiles with cheap oil. but it has been a very volatile session. we saw strength in futures trading overnight and well into this morning, but things started going the other direction when we got jobless claims data this morning. shortly after that, all gains were erased. while we are back in the green,
10:24 am
they have been fluctuating between gains and losses since the market open. that print was far worse than 6.65e expected, a record million people filing for unemployment last week, more than double the prior week, which was revised up to 3.9 one million. over 10ngs the total to million, showing how devastating the toll of the coronavirus crisis has been on the u.s. economy. i want to go back to the move we are seeing today and oil. it is translating to some big moves for energy stocks. energy is the best performing in the s&p 500 i far today, up more than 5% overall. energy players across the spectrum are getting a lift. that includes majors like exxon, higher by 3%, but also services companies like schlumberger, valero. it is really the e&p's outperforming.
10:25 am
some rx is up by about nine rx -- cimarex is up by about 9% today. these are leading the s&p. vonnie: kailey leinz, thank you for that. it is time for your latest bloomberg business flash, a look at some of the biggest business stories in the news right now. boeing will offer voluntary buyouts to its entire staff. it is a bid to adapt to coronavirus crisis that could depress the aircraft market for years. in a note to employees, boeing's ceo david calhoun says it is important the company start adjusting to its new reality. southwest will become the second u.s. airline to apply for federal aid. in a filing today, southwest says it is looking for possible grants that could boost liquidity and provide job security for its employees. merrick and airlines is already said -- american airlines has already said it will have to up billion in aid.
10:26 am
jamie dimon back to work today after heart surgery. , he is, like so many working remotely today. he underwent emergency heart surgery march 5. that is your latest bloomberg business flash. still ahead, we discussed the impact of the coronavirus .andemic jason gardner will join, ceo of marqeta. this is bloomberg. ♪
10:27 am
10:28 am
nowadays you do more from home than ever before. the xfinity my account app puts you in control with digital tools to give you the help you need when you need it. get fast and easy answers with personalized help 24 hours a day, 7 days a week. change your wifi password to a phrase that's easy to remember. even troubleshoot your services on your own.
10:29 am
we're working to make things a little easier for everyone. download the xfinity my account app today. ♪ york, i'mve from new vonnie quinn, along with johnson in london. this is "bloomberg markets." the coronavirus pandemic is
10:30 am
putting a spotlight on mobile payments as people adhere to social distancing guidelines. for more, we are joined by jason gardner, ceo of marqeta, unicorn with backing from goldman sachs paymentrs, that makes infrastructure for companies including instacart and cabbage. also doing is bloomberg's cinelli ballot -- bloomberg's sonali basak. sonali: thank you for joining us. at a time when groceries and deliveries are surging, what types of volume increases are you seeing amongst your clients? haon: thank you for ving me. in the first week, we saw about a 40% increase in delivery, and in the past week and 82% increase in on-demand delivery. it has been an interesting time. sonali: if you are seeing 80% increase, are those volumes
10:31 am
sustainable, or is this just a point in time issue related to coronavirus? behaviors areve incredibly hard to change in either direction. today you will find senior citizens making their weekly purchases on instacart, including my 83-year-old mother-in-law who has never used instacart before. you may have started using for safety reasons, but once you see the convenience, it is hard to go back. delivery has changed the way americans shopped, and i believe it is here to stay. guy: guy in london. we are all trying to understand how the virus is spreading. can you tell from the data on what purchases are being made how quickly it is spreading, to what areas, and what effect it is having once people get locked down? jason: we have an interesting view. where we feature and that is
10:32 am
very much a leading indicator. we have seen an increase in contactless. contactless can be online, through apple pay, android pay, samsung pay. it can be through contactless cards. it is well-known that cash can carry the virus up to 24 hours. there is this feeling that cash is dirty. now we are seeing where it is actually safer to do contactless transactions, prior rarely because people are not -- transactions, primarily because people are not traveling and are working from home, and obviously the shelter-in-place. if they are going to the store, they are using contactless, which has been recommended. we are not seeing where, in certain areas, where transactions are increasing through the effects of the coronavirus. however, we do see a significant increase in online transactions and contactless. vonnie: can you give us more
10:33 am
insight into why cabbage had to cut off lending to small businesses unannounced a sickly? small businesses -- unannounced basically? small business is found them selves trouble. how do something like that happen? don't have a good view into cabbage's decisions to hold back loans. industry in lending small and medium businesses have been massively impacted i the coronavirus. we have seen these last three weeks have been incredibly occult for small business. certainly, the world changed significantly three weeks ago. i think we are seeing the impact of that. companies are making the most informed decisions they can to keep their business going, keep small and medium business intact. we are also seeing where government has been implement in
10:34 am
the stimulus act, and we are seeing money hopefully begin to slow to small and medium businesses that float. we are certainly seeing the impact here in oakland. close upof restaurants shop. marqeta has implemented an initiative where we have raised $50,000 thus far to fund local restaurants to service the most needy, working with a number of nonprofits to make sure people have food. sonali: we want to go back to winners and losers here for a second. you said cash is dirty. if people are ditching contact credit cards, how does that impact the likes of google and apple pay? jason: we are seeing a massive increase already. increase int 10 contactless.
10:35 am
cards are also contactless. tap and today in-store device to initiate a transaction or insert them if you like. we've already seen a precipitous fall in the use of cash, primarily here in the u.s., europe, australia. places where cards are used more. asia, where ain lot of transactions are initiated via phone, qr code or other ways, cash is still predominantly king. overseas, that has significant lead declined. i think because of the coronavirus, people are going to move more to contactless. we've already seen in the coming contactlessards and increase by 30% year-over-year with asia. we are already seeing cards increase 5% year-over-year in the u.s., and 7% year-over-year in europe. i believe that is going to increase now based on what we
10:36 am
are experiencing today. what other trends do you see accelerating as a result of this? the trend toward the cashless society has been happening for a while. is there anything else happening that you see accelerating within the industry , even if it is in the weeds in terms of the payment space? jason: what's going to happen is, as we have seen in other recession types, and obviously we don't know if this is going to be av typed -- going to be a u-typerecession or a recession, but we are going to see is a lot more investment into companies looking to build new-car car products and service new constituencies, and certainly come up with a number of new business ideas. this is a time where we see a lot of entrepreneurs begin to think about new business ideas.
10:37 am
as we've seen over the last few years, certainly within europe, revolut here in the u.s., chime, almost a wholesale dismantling a financial services, the legacy financial services. i think we are going to see more of that. i think we will see a number of new business models that service a number of new constituencies, and potentially a new type of contactless,nline, mobile becomes the predominant player versus cash in a number of industries. sonali: real quick, you also have a very interesting view of silicon valley at this point in time. we are seeing venture funding potentially dry up significantly. what are you seeing in terms of the ability to maybe raise new capital, or those around you raising new capital? jason: it is definitely interesting times.
10:38 am
are looking at their current portfolios, to makeat their cash sure they have enough to get out of the current situation. we see downtrends within the economy, they begin to pull back. what is interesting is vcs typically follow the public markets. if we see a precipitous fall in the public markets in regards to stock prices, vcs follow after that. but it usually takes time. now it is happening almost instantaneously. pencils are being put down around term sheets. vcs are focused on their portfolios. we are definitely going to see funding drying up for earlier , versus later, where we are seeing sustainable growth around their business models. vonnie: thank you for joining us today. that is jason gardner, market a ceo -- jason gardner, marqeta
10:39 am
ceo. our thanks to sonali basak as well. we now have brent crude trading up 23%, w ti 28 percent, after the president tweeted this. ,just spoke to my friend mbs who spoke with president putin of russia, and i expect and hope they will be cutting back approximately 10 million barrels , and would be substantially more, which, if it happens, will be great for the oil and gas industry." i also want to point out that right after that tweet cross to the wires, we had a headline from the saudi news agency that saudi arabia is looking for an opec+ meeting immediately. stat beingeting requested by saudi arabia. this is having a massive impact on oil prices, and the price of oil stocks as well. we are seeing them surge. guy, you have more breaking news. let's guy: guy: talk about what is at -- guy: let's talk about
10:40 am
what is happening in european backing. unicredit, the union agreeing that there will be job cuts. more bad news for italy. the banks are having to look to make cuts. some of this is already in trade, of course. we have seen consolidation in this space, but timing is everything sometimes. 5200 job cuts are going to come. not great news for unicredit. unicredit operates in italy and various other countries around europe. job cuts across europe, it seems. that saudi news come of the trump news, absolutely amazing over the last few minutes. moredetails than that -- details on that in just a moment. this is bloomberg. ♪
10:41 am
10:42 am
10:43 am
vonnie: this is "bloomberg markets." coming up later today, we will speak to the verizon chairman and ceo. this is bloomberg. ♪ guy live from london, i'm johnson, with vonnie quinn in new york. this is "bloomberg markets." we have seen over the last few minutes a huge surge in the price of crude. president trump tweeting that the oil markets are going to see a huge cut in output. he says, "do spoke to my friend mbs, the crown prince of saudi arabia, and president putin of russia. they will be cutting proximally 10 million barrels." let's ring in now to this conversation bloomberg's annmarie hordern.
10:44 am
let's talk a little bit about what we know. is this actually going to happen? the russians are sounding a little bit more cautious, but it looks like president trump is banging heads together. annmarie: it certainly does with this tweet. one thing i would say is that we are also hearing from the kingdom, calling for an urgent opec meeting. -- thegdom once this wants this meeting. i would say it's not a done deal yet until you get alexander benk inside the room with solomon -- with bin salman. you have seen this impacting oil producers in the permian. we are joined now by the texas railroad commissioner. thank you so much for joining us. i am sure you just saw the news of this tweet. what do you make of it? i think it became clear from
10:45 am
saudi arabia that they want everyone to share the burden of cutting production. this tweet,aving does this signal that all three major producers are willing to cut? guest: when you say all three major producers, you mean russia , saudi arabia, and the united states? annmarie: yes, of course. guest: this is happening already. this week, the texas railroad commission received a request from some texas producers to begin to prorate production here in texas. most of us feel like any one entity acting alone cannot balance this market. i put out some data just yesterday showing the market is already millions of barrels a day oversupplied. that was before we got the recent layoff numbers from the united states we got this morning. i think we are now probably closer to 24 million barrels a day oversupplied. the world oil suppliers are feeling the crunch, and in order
10:46 am
to balance this, it is going to absolutely take a global response. likerie: industry groups american petroleum institute, the american oil and gas association, have criticized your plan to progression. -- two pro ration. how do you get all of the producers on board? ryan: one of the things i think has been missed a little bit in the headlines as opposed to the deep innerworkings, no one has actually proposed proration yet. what we said his let's have a conversation on how we bring these different groups together, and if we are going to prorate, what is that going to look like? some groups said we don't even want to talk about this, which seemed really shortsighted, and i think that was in the first week. since then, a lot of people has said this is continuing to get really bad. maybe we should have the should have the conversation. so we are seeing positions
10:47 am
soften on this as people see the magnitude of this problem. vonnie: we've reported on bloomberg that two other commissioners at the railroad commission have voiced concerns about pro rationing. would you be outnumbered? ryan: no one is ready to have a vote today. only two of us have made statements that we are both cautious, we are both free market people, but we also recognize the extraordinary circumstances, and we should look at any option to bring stability to global energy markets. we are very close to the same place, but we will not take a vote until we get all of the various opinions and options. i don't know if you heard this, but we are not pushing for an april 14 open meeting where we would hear testimony from producers, and his two groups,
10:48 am
and economists all over the world about how we might do this and we are waiting to see what we learn and what ideas we get a little less than two weeks before we make any moves. you spoke a few months ago about the huge effort that would be needed to balance the market. americans aren't driving. the europeans aren't driving. the economy is in lockdown, and demand is nonexistent. how big an effort do you think you are talking about here? how much of a supply cut to get think we need to see to balance the market? ton: i think if you wanted balance the market today, we've got to bring probably 20 million to 25 million barrels a day off-line. that is going to happen one way or the other because storage is filling up.
10:49 am
if we get to june 1 and there's no more storage left in the world, than the markets will balance because you can only produce as much crude as being consumed. i think the question is not whether marcus will come into balance. the question is will it be done in a strategic, thoughtful way, or in a reactive way. i am a proponent of the first, that we take a more thoughtful, global approach to reacting to this extraordinaire circumstance. annmarie: one thing i think we should mention, putin, according to his press person, says he has not spoken to the crown prince. i am wondering whether this is too premature. if we were to see 10 million barrels a day come off the market, demand destruction is immense. do you think it will do anything to prices? ryan: to be quite blunt, i don't think it is going to push prices up anywhere close to where they were before covid-19, but if you pull 10 million barrels a day out of the market, that extends
10:50 am
the life of intermittent storage. it says instead of filling up storage around the world in two months, be it takes four months. if the world gets back on its feet and we pull out of all of this shelter-in-place, perhaps that gives us enough time to bring things under control. yes, i'm thinking we will bring prices up, but it don't think we are going to see wti at $45 or $50 a barrel anytime before the end of the year, even if we do see 10 many of barrels out -- 10 million barrels out. vonnie: fascinating times. thank you for joining us today. that is ryan sitton, texas railroad commissioner, and annmarie hordern as well. this is bloomberg. ♪
10:51 am
10:52 am
♪ from london, i'm guy johnson, with vonnie quinn in
10:53 am
new york. this is "bloomberg markets." vonnie: time for futures now. no better time to look at oil futures than now, with president trump's tweet a moment ago, followed by the report out of saudi arabia it is looking for an urgent opec+ meeting. joining me over the phone is bill baruch of blue line futures. brent is at $29.03. wti is above $25 a barrel. we are seeing a massive rally. the president is calling a hope on its petitions that there will be a 10 million barrel a day decrease. how much do you place in the president's word? will saudi arabia and russia agreed just because the u.s. president wants them to? bill: you know, i think there are going to be a lot of details to iron out here. ultimately, i was talking to our clients earlier today that we could see a move towards $30 on headlines, and i think that is going to be a fade the
10:54 am
rally opportunity. if you don't act now, you may miss that opportunity. there's a lot of resistance at $28 that we are testing into right now. i want to see this play out. i am not saying oil can't get above $30 in the near term, but without a drastic change to current landscapes, that includes at least a 10 million barrel a day cut by opec, we are not going to see this thing rally above $28. for now, i think there's opportunity to fade this, but i'm open minded to what will develop here. vonnie: so you're saying cell, notbuy -- saying sell, but. we are not -- saying sell, not buy. we are not going to see $30. is that what you are saying? bill: i think you get a fade the rally opportunity on this. if we see some of the
10:55 am
details that opec irons out, we could see $30 tested. this market in general has a lot of headwind. what is the demand going forward? a lot of the hard data remains to be seen. we are getting jobless claims today, and really the jobless allude are going to to how poor the data will be for march and april. there's a lot of question marks out there. then the 3.5% of all air passenger travel is down -- 93.5% of all air passenger travel is down. i just don't know what the demand structure is going to look like 30 days from now when we have some more certainty. vonnie: these clients you spoke to today and others, what is your best trading idea for them right now? bill: we are looking farther out. we are getting exposure in gold and silver. that's on the futures side.
10:56 am
i think we are going to see a bit of a commodity revival here with inflation. i think crude oil will benefit from it down the road. i don't think so much in the near-term. i do think gold and silver will trade very well in the back half of the year. that is on the futures side. on the portfolio structures, we do manage portfolios as well, it is about what you're protecting. theerday in the last day of quarter, we cut all of the exposure there, but i think it is continuing to manage what you have in the markets and digest the data as it comes out. vonnie: bill, thank you. bill baruch of blue line futures. this is bloomberg. ♪
10:57 am
10:58 am
10:59 am
11:00 am
from london, i'm guy johnson, with vonnie quinn in new york. we are counting you down to the european close right here on "bloomberg markets." clearly, the news over the last half-hour has been coming from the crude market. the president of the united states weeding that we could see 10 million barrels a day coming off of the market, and indication from the saudis that we are potentially looking at an opec+ meeting. the russians sounding a little cooler. equity markets are often earlier lows. 0.8%. now up by the energy sector doing all of the upside heavy lifting. we've got the energy sector here and gase, the oil sector up by 7.75%. brent crude off earlier highs. we did initially bounce north of $30. we are 24.3% to the good right now. another basis point


info Stream Only

Uploaded by TV Archive on