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difference to the curb the two year yield is 445 and the 10 year yield is i close to 396 right now. that's a far cry from a week ago. wti crude at -- is up 2.5%. the red sea concerns are overshadowing supply easing at the moment you jon: we've been watching that in the canadian market as well. it's been helping energy stocks in canada and helping energy stocks in new york as well. exxon shares are up 1.8%. the tech rally continues if you look at the s&p 500 leaderboard with alphabet and facebook parent meta in the neighborhood of 185% so for this year. staying with technology, we been covering the adobe fallout with that deal not coming together. investors seem to be ok with that at least according to the intraday performance.

adobe is up about 2% and we are watching the story surrounding sun power which is been under tremendous power -- pressure with concerns about their future. with that stock sinking more than 35% today. vonnie: in the broader economic outlook, tumor fed officials pushing back against market expectations for rate cuts next year. austin goolsby saying he was surprised by last week's market reaction to the possible fed pivot and he told the financial times that the markets are a little bit ahead. they jump to the end part which is we are going to normalize quickly and i don't see that. we is how bloomberg opinion columnist bill dudley sees things playing out. >> we've had pretty steady growth yet the inflation rate has come down. the prospects of a soft landing have gone up the market is getting a little ahead of itself and this is how jay powell thinks things will pan out. he thinks the fed will be cutting rates nature but it's

possible they could be -- things could be used more stubborn for longer. jon: let's get some perspective. jennifer lee is joining us to what your take on how the market has been interpreting all of this fed speak? >> good afternoon and thank you for having me. on friday afternoon at the close, i sat back and i thought what the heck happened this week? you cannot blame the market for jumping all over powell's comments, saying they were lot less hawkish than many of us would have expected. you cannot blame the market for doing what it did which is rally everywhere and anywhere it seems. i think this is premature. it's interesting how are number of fed officials came out over the past couple of days to say -- to push back on the earlier

rate cut expectations. you still have a strong economy so it's too soon, or 5% annualized growth. we are not seeing q4 on ice just yet. we said decent -- we had decent retail sales numbers so i think this is premature with expected -- with expectations of rate cuts and we will get better data in the weeks to come. jon: what does that mean in terms of your own predictions now? what are you anticipating when it comes to monetary policy into next year? we have 100 basis points of rate cuts coming in the coming year, starting around midyear. i think the market is way too early. given what we are seeing what we saw from the dot plot and what chair powell has been saying, we will probably see about four

rate cuts next year. that is as of today or december and things could change depending on the data. as you all know, everyone is data-dependent and everyone is looking at the totality of the data so we will see how things play out but we are looking for about 100 basis points of rate cut next year. vonnie: the current estimate from the fed is 2.6% inflation. if we get core pce data that comes in lower than the fed anticipates, does that put pressure on the fed to lower in march? >> it would definitely add pressure. you will need more than a couple of months of better inflation data. whether or not it will be three or five cuts before we can start penciling in the rate cuts. the discussion was huge and the fact that they admitted and are talking about it. i think it will take a few months before we start officially calling for it but we

will be more than just inflation. it will also have to be slower economic growth but not just slamming on the grip -- on the brakes. vonnie: there was a line into the news conference that you can't put the toothpaste back in the tube. why are we seeing such a course of fed speakers coming out and backing off on what powell had to say? >> perhaps they thought that we should have fine tuned some of those comments more, perhaps they are thinking they weren't expecting such a market reaction. fed chair powell didn't say we would officially cut rates but he said the fact that we are discussing it, that was the biggest change in his tone. he admitted that rate cuts are in discussion. i think fed officials were ready to say stop this and make sure you get the right message out. i think you can see more fed

officials coming out and saying they need to calm down markets a little bit. jon: in terms of the data points you will be watching most closely in the months ahead, does it start outside of inflation or does it start with the employment picture? >> that's certainly one of them but i think consumer spending when we get the november figure at the end of this week will be important. certainly inflation and all different types of reflation measures come it's not just the one component anymore but looking how the university of michigan sentiment and how that pans out. the latest saw a decline in expectations. we will have to see more of that in order to be more comfortable with what rate cuts will be coming in the middle of the year and the information we saw this morning with the attacks in the red sea. that's adding a little more of a twist to this whole story. we will have to see how everything plays out. jon: thanks so much, we

appreciate your time as always. she serves as the senior economist and we want to get to some breaking news -- it's tied to the sentencing of trevor milton the founder of nikola. you might recall that we were awaiting this present sense -- this prison sentence time with the future of the electric truck maker. he is receiving four years for fraud based on the headlines that just are crossing now. i want to bring in ed ludlow who's been tracking this developing story. what more can you tell us? ed: nicolo founder trevor milton has been sentenced to four years in prison. it's significantly lower than the 11 year term the government was pushing for and the probation officials have recommended based on the one count of securities fraud and two counts of wire fraud of which he was found guilty in october, 2022. it's still a significant sentence.

as you said, trevor milton was found guilty of misleading investors over the progress his company had made in its early stages, the capabilities of its technology this is a trial that we had bloomberg have been following closely for a number of years. we first broke the news in june, 2020 that milton according to our sources had made misstatements about the capabilities of their early technology. for years is what the sentence is. u.s. attorney whose office led this trial is the same office they got a guilty conviction on sam bankman-fried. they have kind of promised to crack down on this white-collar financial crime area. this is their latest victory. vonnie: this is a signal potentially for how sam bankman-fried might be sentence. does it depend on the judge?

i'm sure they don't potentially see this as a win. ed: at the core of this case was whether or not retail investors in particular had been moved to take action by trevor milton's statements particular on social media. in debate around his sentencing, the reason the government stated it was important to have strict sentencing was to avoid any temptation by future actors to behave in the same way. that way the everyday investor would receive harm so that was the motivation from the government side of this case. they wanted to see strong action to deter any similar behavior in the future. jon: really appreciate you breaking that down. you will continue to track it and we will as well. that's the latest on that trevor milton sentencing at four years. turning back to the big debate in the markets now which centers

around global monetary policy into next year in canada, the bank of canada governor is striking a cautious tone saying it is too early to talk about interest rate cuts. amanda lange sat down with him and asked him about the path forward. >> we are certainly feeling more confident that monetary policy is working and increasingly the conditions are in place to get us back to 2% inflation. that is not yet assured. we are not there yet. there are a few more things we need to see to be more confident that we are headed back to 2%. we are watching those closely. >> it felt in your most recent announcement that you were kind of saying that we might be there but you caution. you don't want people to jump ahead and say it's all over, now we can look forward to rates coming down. what is the line you want canadians to hear from you on this? >> monetary policy is working

and it's working largely as expected. we know nobody really likes the way it works. it's squeezing canadians but unfortunately, that's what's needed to get this last bit of steam out of inflation. the other message is yes it's working and we have to keep let it working. it's important that we get back to price stability. that's the destination, that's what canadians expect from us and that's what we want to deliver. >> as you know better than anyone, canadians don't tend to think about rates. affordability is how canadians feel it is been a huge issue going on two years. this past year has been hard for many. there is a disconnect even while economists are starting to say this looks pretty good. we are feeling pretty good about where we are going but canadians are saying we don't feel good and confidence is down. does that make sense to you

because they are feeling the affordability problem that there will be a lag in her confidence returning? >> you are absently right. we can see this. yes, we've made a lot of progress to get inflation down. it was a percent last year but what are canadians feeling? they are feeling prices went way up and inflation has come down but prices haven't come down. even inflation is still too high. the economy is slowing, interest rates have gone up, none of it feels very good. an important message though is that we are at the end of 2023 and moving into 2024 soon and we expect that will be a year of transition so the first part will not feel good. as we get later in the year, i think we can expect growth to be picking up and inflation should continue to come down it should be getting closer to the target by the end of next year.

we are not there yet but we are getting there in the end is in sight. jon: that interview will air on taking stock at 6:00 p.m. eastern time this friday. coming up come more on a big steel story today, japan's biggest deal producer requiring u.s. steel in a $14 billion deal. this is bloomberg. ♪

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jon: this is bloomberg markets. time for our stock of the hour. we are watching shares of u.s. steel sirs today after japanese steelmaker nippon reached a deal

to buy them at $14 billion creating the second largest steel company a follows that u.s. steel had rejected the offer originally. on the labor side, the united steelworkers are pushing back on this one. i want to bring in joe on this. what we know about how this one came together? >> we knew there were multiple bidders in this entire auction. we knew they were there because they announced to themselves. we reported that stelco was there and we were aware there were probably some other bidders . the fact that nippon came out this morning as the winner, it was a bit of a surprise to the market. i don't think a lot of people had tagged them as one of the obvious buyers. of course, the price at which they bought it, $55 per share is

$20 per share more than what class authored back in august. -- cliffs offered back in august. it took people off guard especially being the japanese steel producer. vonnie: is the union powerful enough to derail this somehow even though nippon has said it will honor any agreements that have been made with the union? >> the legal part of this is the union now has the right to make a bid for the company that is better than the offer that has been put on the table. also have the right to transfer that bid to another party. what they have said to is that o get their exclusive right to bid to cleveland the option, they could make another bid and beat whoever one. it's unclear if that is actually going to happen at this point.

there is still a lot that has to play a but cliffs came out earlier today and made a statement that they are aggressively pursuing a buyback program and they congratulated and wished good luck to nippon and u.s. steel on closing the deal. that signal to us in the market that may be cliffs won't take them up on that. there is still a lot that is uncertain here. the steelworkers are obviously not too happy about this. i spoke to the present of the united steelworkers this morning and he said this is not going to work. then they came out with a very abrasive statement after the earnings call in which they said they didn't support it and they want government regulators to look closer at this deal. vonnie: thank you and fantastic reporting. coming up, big-name companies are holding shipments in the red sea which accounts for major part of seaborne trade.

details are next. this is bloomberg. ♪

vonnie: this is bloomberg markets. bp said it will hold all shipments through the nc after attacks on merchant ships escalated. the rep is critical for many economy's accounting for 12% of global seaborne trade. here is what the ceo of frontline, one of the world's largest super tanker owners had to say about the situation. >> the region has not been us a long time but now it's escalating beyond what we have seen. it's a huge current risk concern. vonnie: we have been covering this story. it's not just bp but we've had rerouting from companies -- from

other companies. the list goes on and on. how bad does this get? >> i think that's a good question and i think the ceo of frontline was absolute right to flag this as a potential risk. one of the big surprises when the hamas-israel were started was the involvement of the houthis and their continuing involvement is of great concern. jon: we should add that it felt like some oil market participants were getting used to the reality of war. until recently, we watched deterioration in the price of crude but this is putting more of a cost of business if you will on the situation. >> i think what it's doing is emphasizing the risk involved. right now, you have a lot of supply in the sense that demand is waning. overall, oil prices, gasoline prices been declining and that

has been contributing in a good way to the u.s. inflation situation and the soft landing. this injects a note of risk however. it doesn't necessarily crush those supply and demand trends that are dominating in the market now. you can see that wti crude is up a bit but is not going crazy over this. vonnie: we had lloyd austen in the region talking about a new maritime task force that has been in the works. what decisions can a task force like that make given that we already know there is u.s. naval assets and the regional ready? >> that was one of the strongest signals that the u.s. sent right from the get go that they were positioning in order to prevent a regional outbreak. lloyd austin sends a strong signal. he is in the region and tracking

it and there is a tremendous awareness that if the war increases and there is another front opened, if hezbollah which is backed by a rent as are the houthjis, if they get involved, you have a serious escalation. everyone is aware of the sensitivities will absolutely do what they can to ensure the safety of this critical shipping route. jon: thank you so much for that breakdown. we will continue to watch the headlines. we were talking about the oil price being higher today. perhaps not a huge move higher in energy but in the energy stocks, one of the considerations for the s&p 500's positive performance today, we are continuing to also see investors continue to give tech stocks a look as investors are shaking off perhaps some of those fed official rate messages. after seven weeks of gains for

the s&p 500, it's steadily moving back to its all-time high. we will track that closely. this is bloomberg. ♪ fresh, warm hot dogs! when i'm not selling hot dogs, i invest in a fund that advances innovations like robotics. fresh, warm hot dogs, straight out of my torso! one for you, one for you. oh, you're a messy one. cool, right? so cool. anyone can become an agent of innovation with invesco qqq, a fund that gives you access to nasdaq-100 innovations. hot dogs! fresh, warm hot dogs! before investing carefully read and consider fund investment objectives, risks, charges, expenses (jennifer) the reason why golo customers have such long term success and more in prospectus at invesco.com.

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overpowering feedback? >> i am scarlet fu. >> kicking off to the closing bell in the u.s. and take a look at this equity market and we do have yet another rally on our hands, the s&p 500 up. look at the nasdaq 100, big tech, up even more. scarlett mentioned that the fed pushback is not making a dent in the equity market.