>> welcome to bloomberg markets. stocks are turning negative as oil is tumbling pulling down energy shares in the session. let's get a check on these markets. the s&p 500 down on the day. looking at a decline off session lows but still down about one half of 1% near session lows. the nasdaq 100 now negative about 4/10 of 1% lower. the bloomberg dollar roughly flat on the day seeing gains after a reversal earlier in the day. crude, a 74 handle. more than 3.4% lower on the day.

this is the lowest levels we have seen on crude since february of this year. opec saying crude production would be steady well key members of the group are flouting quotas. we will keep an on all the moves. we want to bring you midday movers. david ellison of sky dance media is said to be making an offer of paramount that includes an option for non-sharing -- nonvoting shareholders to cash out a portion of their stock for $15 a share. the decision is in the hands of the chair of the matriarch of the family. we are keeping an eye on berkshire hathaway. a-shares were among dozens of stocks that were briefly halted this morning due to a technical issue that has been resolved at the new york stock exchange. last week trading data from multiple exchanges including the s&p was not being fed into outlets for most of thursday morning. we are going to discuss the technical glitches at the new york stock exchange with

bloomberg's katherine doherty. what do we know so far and has the issue been firmly resolved? >> the issue does seem to be resolved. there are a lot of questions as to why this happened, how it happened but what we know as of today, the issue is stemming from the industrywide price bands. these are supposed to be protection so that stocks are not sliding one way or the other up or down. these price bands were not put in place for certain stocks allowing them to have these volatile swings which is what these protections are supposed to prevent. sonali: otherwise known as limit up, limit down. how did this affect stocks in particular? katherine: berkshire hathaway, we sell in an 9% drop to it as of today those shares are back trading. they are nowhere near where the share had slid two. the pricing seems to be updated or closer to what it had been

trading at as of last week. we also saw supposedly and abbott laboratories, those were other two shares that were halted. not only did we see swings but some shares were halted which we often see in times of high volatility. this is not an unusual protection or measure taken by exchanges but it does seem to be a system error and not something that was implemented because of high activity which is what you would normally see in times of high volatility. sonali: do we know if part of this is because of the shortening of settlement times? everyone thinks tea plus one might be behind some of what we have seen in the last week. do we know this is related to that? katherine: it is the question i keep getting. this is the third system error that has been referenced by an exchange in the last i believe starting from last tuesday. last monday was a holiday. it is something as of today it being the third system issue, a

lot of folks are saying is now this coincidence everyone was saying a tie to an actual error that is due to people us one? earlier and folks in the marketplace are saying it is a timing coincidence. it does seem to be the coincidence is a big question mark because when you see something like this happen, it has not happened in the last six months so why this week you have seen the errors happened? sonali: i trust we will learn a lot more in the coming days. let us katherine doherty. we thank you for your reporting. on the economic front, we have to talk about yields heading lower today, about u.s. factory data shrinking in may at a faster pace than anticipated. a measure of orders fellow in the most by two years. we will discuss this with chief economist frances donald. does this justify the move you're seeing in yields? >> we did feel it was a bit of

an outsized move even though we are in the disinflation camp. we are in the recession is underpriced camp. that was a big move in yields for what is some decimal points. watching manufacturing we feel is going to be incredibly important. a lot of eyes on their employment report on friday, future inflation. manufacturer is supposed to be this tied that lifts the global economy. that data had been looking better the last couple of months. some of the no lending stories. if it retreats and there were some signs of it happening, we lose the big upside that was supposed be lifting the economy. that might be why we are seeing the market clue a little bit on this data point. sonali: how closely do you have to watch of the data on manufacturing as it pertains to how quickly this economy might soften overall? this frances: is the really big challenge. you might remember at the end of 2022, 1 hundred percent of economists are calling for a recession in 2023 because all of

the manufacturing data was tipping into recession. historically when manufacturing goes under, so does the whole economy. we all know know recession materialized in the united states. manufacturing and services now much more disconnected in the post-covid economy. that broke a lot of economic models. we are trying to get a sense of whether the economy and mentor fracturing are we coupling or whether they are running on different cycles. the big difference between those calling for soft lemmings, hard landings or no landings will come back to how are they incorporating the manufacturing impulse into their outlook? sonali: even if you see yields moving lower today, you look at the fed swaps and you have a flip of a coin. when you look at the potential to cut rates for the fed in september, do you think that will be firmly possible at this point and if not, what are the big risks?

frances: the fed does not have the economic data it needs to justify a cut yet. think it will be there by september but the fed is populated with people who have biases and concerns. we are coming off this huge price level shock. they may want to wait longer than that. the fed needs to see the employment market weaken a little more. manufacturing tells us where the market should be in six to 12 months from now. we don't know whether they are going to have enough by september. it comes down to a coin toss. the market needs more information or is awaiting for friday's big jobs report. that will move markets one way or the other. sonali: how do you feel about the jobs report on friday? when you look at the data, what are you looking at most closely the on the absolute number? frances: i'm looking at a host of job market data. including job openings. that has quit rates and hire

rates. those are beloved numbers by the federal reserve popularized by janet yellen. we will look at the challenger job cuts. the nonfarm payroll number continues to surprise to the upside. we might have statistical issues at play. might have increases in population. if you want to get a sense of where jobs are going, i don't think you can look at friday's job report. when we build our dashboard, all signs point to a much more exhilarated slow down into the second half of this year. sonali: what else could that slowdown look like? when you look at the markets, there are a lot of worries about the u.s. consumer under the surface and a lot of debate on how strong the consumer is. what do you think? frances: i think the consumer is very bifurcated. two things can be true at the same time should you can have a consumer that looks good because wealthier incomes are benefiting . lower income consumers are not. we see this in survey data. we see this in company reports.

we know there is a huge bifurcation at play. we have to figure out as economist how do we wait those income classes and we can say on aggregate the consumer may look ok but there are lot of trouble spots underneath. that is why you need active management that is going to know which stocks can outperform in the post-covid bifurcated environment and which ones are going to do worse. sonali: we thank you so much. hope your week is off to a great start. it is a busy week ahead not only with jobs data at the end of the month but the ecb decision this week as well. frances donald. coming up, we are going to talk about gamestop considering it's 2024 run after another red opposed invigorates retail traders. it is our stock of the our next. this is bloomberg. ♪

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sonali: this is bloomberg markets. it is time for the stock of the hour. taking a look at gamestop shares after the investor known as roaring kitty is driving a rally in those shares. billy lipshultz is here to explain why the renewed excitement around the meme stocks especially when it comes to gamestop. how much did he say he bought? bailey: he said his position is worth $116 million so close to five x that was the last time he was that unread in love 2021 so i substantial increase. in the common stock as well as call options. worth about $65.7 million. if he could exercise it, that would add 12 million shares to that steak and be on paper a

tremendous windfall. sonali: it is safe to say he has gotten quite wealthy in the meantime. bailey: very different from the initial meme investor, the retail trader who on paper not many investors are worth north of $116 million. sonali: you are seeing the retail really come into play. what else is being affected? bailey: we are seeing amc. another of the other stocks caught up in the craze. the stock open 75%. now it is up closer to 27%. and there be something to drive the follow-through? we saw a post on next last month, the stock tripled but you raised the gains in the coming days and weeks. the question now is going forward, will there be something else to drive the stock higher? sonali: as you note in your story, just how far a lot of the stocks have fallen since they reach their last set of highs. how much were retail investors left holding the bag in 2021 the

last time we saw this? bailey: if they lean in to the hold on for life model, you're looking at a stokley game see down 99%. while there are a lot of investors who may be cheering hookah in early this year, if you blow in 2021 and held there the january peaks, you're sitting on tremendous losses. that is what we have been seeing investors on the fidelity platform taking advantage of these rallies to erase losses or take gains. sonali: there a lot of questions about how deep this activity goes. and this happened last time around when we spoke to citadel securities, they could be accounting for 25% of the market. we have any indication it is that large a set of investors this time around? relent bailey: it is a little early to tell. the big question and this is something we talked about in may was you look at the trading

volume, you look at some of the trading numbers. 113 million shares traded, that does have the figure prints of quantitative or momentum traders. tell investors are longer sitting on the millis checks. you look at volume, the question is who is driving it. sonali: the big money chases the small money chases the big money. iq for keeping an eye on the retail traders. we are talking about how nvidia is leading the pack of companies. we are going to switch gears back to the debt markets and how it pertains to companies because nvidia has earned more interest income than they paid in debt expense. it reported a $359 million interest income for the first quarter. more than enough to cover its quarterly interest expense of $64 million. we have the perfect person to break it down. nina trotman who reported on this. we are out of this busy earnings season and you are so close to

how a lot of these companies think about capital management. what happened with nvidia and is it unique among companies? >> during the past quarter web video was able to achieve, when else among the companies in the s&p 500 was able to achieve given that they not only as you pointed out generated way more interest income than they had interest expense on their debt but they generated enough to cover 98 million which is unique among companies and s&p 500. sonali: why aren't more companies looking to clip coupons? >> there is a fair amount of companies generating income with rates being higher than before. we are seeing companies spending more on evidence. even though the company plans to increase by 150%. if you look at the amounts of the alphabets or meadows paying in dividends what entity of his pay is not very much. it is an achievement by the companies, treasury and finance department but at the same time

their limitations as to how much they pay on dividends. sonali: what is the outlook for more short-term investments? ? if you think interest rates going to start decreasing as early as this year, you still hold onto cash knowing it is worth more than it was today five years ago? nina: compared to five years ago, certainly so. what we're are hearing from treasury advisors is companies will continue to generate returns in money market funds and other cash like investments because the amount that is flowing into these funds is expected to increase as the economy keeps growing. expectation is very much once interest rates decline you will see a better return in money market returns even that you prolong to the effect a little bit. sonali: much investors -- how much are investors catching on? where are they wanting companies to put their excess cash? nina: it depends on who you speak with on the investor side.

there are companies that manage money market funds and are happy about this. more than 6 trillion in money market funds. there are others whom energy bond funds who are saying once rates come down, corporate bonds as the place for corporate treasurers to put their excess cash. we are hearing from treasurers they are risk-averse when it comes to corporate cash so a fair amount stay in money market funds but others might move into corporate bonds once rates come down to sonali: a lot of questions about what higher for longer means for a lot of these companies. thank you so very much for your reporting. coming up, wall street's hottest trade is having an ugly moment. we are going to take a look at one firm tied to the world of private credit next. this is bloomberg. ♪

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sonali: this is bloomberg markets. it is time for the wall street beach where we look at an ugly moment for wall street's hottest trade and that is private credit. joining us is carmen arroyo to talk about what happened in one incident with a company associated with vista equity partner. what exactly happened here that threaten some of the investments? carmen: what happened is this to purchased of this company in 2021. it was a time when there were a lot of lbo's happening and they

financed the purchase with a direct loan from a club of lenders. since then the company has not performed well and they had to pay an interest payment on the loan. the company could not do it or it did not want to do it or basically had to find ways to make up for the interest payment. with the company did is take out certain assets, intellectual property and put it in a restricted subsidiary weakening the lenders claim to those assets. sonali: the whole thing about private credit was it is a small group of lenders. the private equity firm, private credit firms know each other. what happened here? is this showing that market is not as ironclad as they say they are in relationships? is this the issue? carmen: i think this has shocked the market. no one expected to see something like this. bible build exercise miniatures are common in the public markets. they are not common in direct

lending because of what you said. -- relationships are important documents are much tighter. it is an unusual thing to see. it is not the same as in the broadly syndicated market. the way this was done was in restricted subsidiary so it is still tied to the covenants of a prior loan. vista was petting the lenders in other situations. sonali: on one hand this is fairly unique for the private credit market which has changed a lot in the last couple of years. we have seen similar types of situations. this asset stripping you are talking about. where have we seen at? carmen:carmen: the most famous one is the j. crew one where it was a drop down and asset stripping of the intellectual property. that set a precedent. a lot of other firms have followed that i the broadly syndicated market should that had not happened in private credit yet. it is an unprecedented thing.

sonali: do you think as things get rough or we could see behavior start to change in the private credit market given we are seeing the private equity sponsors take more aggressive moves? carmen: we could see something like that especially because a lot of the lbo's are done at a time when interest rates were not that high. we still have to acknowledge the documents and direct loans are much tighter than the bsl once. it could have been i don't think it is unexpected should i doubt we are going to see as aggressive moves. sonali: it will be interesting to keep and i on these situations as they play out. . carmen arroyo taking a look at one of the hottest stories we have on the day. a quick update on the sky dance offered to paramount global. the offer includes an option for nonvoting shareholders to cash out a portion of their stock for $23 a share. the decision is largely in the hands of sherry redstone who owns 77% of the stock should you

are seeing paramount global shares higher on the day by more than 7.6%. of course highly watched deal and a lot of twists and turns as we watch the way larry ellison's firm sky dance is planning to merge and a complicated deal with paramount. before we let you go, a quick check on the markets. a down day. the s&p 500 down 6/10 of 1%. the nasdaq 100 lower on the day. around one half of 1%. the sustained bid in the two year yield after the ism data five basis point move lower to 482 on the day. the 10 year standing at 440. a busy week ahead. that does it for bloomberg markets. this is bloomberg. ♪

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> from the world of politics to the world of business, this is balance of power. live from washington, d.c.

joe: the trump campaign pockets millions more on the verdict as lawmakers return to washington today with retribution in the air. welcome to the fastest show in politics. happy monday. we are just beginning to feel the impacts of the verdict in the nation's capital. kailey: one of the impacts is a massive fundraising boom for donald trump. 52 $.8 million in the 24 hour period. that was more than joe biden and the dnc raised in the entire month of april. joe: we thought 34.8 was the number we had the end of last week. it keeps on going. donald trump on a west coast fundraising swing is going to be meeting with mega donors, probably pulling in a lot more money. as lawmakers come back to town, they have plans. asked senator mike lee or marjorie taylor greene.