>> we are moments away from the closing bell. this is the bloomberg market day, i am alix steel. alix: you are looking at markets finishing lower on this day, snapping a two day winning streak. the dow off by 85 points. at one point the dow was down by points at its two session low. the s&p, a big reversal, its all-time closing high but

pulling back since then, ending off by about 10 points. a big story is also those yields, the 10 year yields comes with a high level so far this year. breaking news, federal reserve board announcing five former private bankers and senior managers are barred from employment in a banking industry. all were previously indicted for helping americans evade taxes. i want to bring in peter cook for more of the details. dates back to 2000 11, the case the federal government brought against helpingweeps bankers americans of eight income taxes. all the individuals have been indicted by the justice department in 2011. the fed is taken the additional step of saying they cannot work in a banking industry. there are banned from the banking industry under the fed's guidelines. this is one more punishment.

all five of the folks identified have not yet turned themselves into face justice in the united states. this is just one more step of the federal government to go after them. perhaps than a most recognizable, for anybody following this case, is marcus -- he was the head of american offshore banking for credit sweeps. the individual worked within that department helped americans evade their taxes. they settled with the government, paid a hefty , try to adjust the concerns brought forward by the justice department, by the u.s. government. there are still some left over issues and one of them is the status of these individuals. the fed is taking these actions that have been discussed previously by the federal reserve but taking official action to ban them from the

banking industry. not clear what this means for them because they are still abroad. some breaking news on an old issue involving bankers. alix: i am joined by managing .ditor joe weisenthal it was a bumpy day for stocks. the s&p touching the closing high and pulling back, ending by denver points -- ending down by 10 points. the 30 year treasury today went over 3% for the first time in a while. whatis a continuation of we saw last week and several days ago. alix: and the idea of taking inflation off the table, maybe we are seeing a little bit of growth. by thet upgraded european commission. perhaps we have better growth globally. do people buy it?

is this an inflation trade or is it they will take more money off the table? joe: there are signs european growth are better than expected. those signs have been here for the entire year. some talk about china stepping up its stimulus efforts. therefore removing that they are for removing some of the deflationary forces on the economy. -- they are for removing some of the place very forces -- removing some of the deflationary forces on the economy. alix: we will take a look at overall stock markets. we had that major rally at the end of last week and we are seeing a bit of pullback here. we are seeing small caps rally but not enough to offset the rally, the deep decline in energy stocks. the s&p is grinding lower all day. joe: it is hard to get to

exercise to about today's selloff. clearly u.s. stocks in many places have been on a huge rally. given the selloff we have seen in interest rates and in parts of the fixed income market, it is impressive how well equities are holding up area alix: i want to go to a -- holding up. activists today are raising full-year earnings forecast to include allergen contribution. speakingnd president to bloomberg in an exclusive interview earlier today. >> these businesses depend on people to execute. they depend on people to make sure that their business continues to gain traction and have momentum and discover new .rugs when you set up a hostile situation you create bad blood and it takes years and years to integrate bad blood companies. most integrations fail.

alix: is interesting cousin seems like he is creating a new category, where you be -- where you see big pharma getting outpaced by the gains in biotech. maybe i can cut costs and use the money for r&d. it is pretty impressive. joe: he is calling out what we have seen in pharma and the last several months. there is someay headline about some proposed deal, some hostile takeover bid. it is an and extraordinary volley of deals and attempted deals. alix: some breaking news if concerning cap -- breaking news concerning cap -- concerning gap. julie: for april they sold 12% and were estimated to be down only 7%. those are the u.s. numbers. global sales were down 15%.

it looks like the issues are in all of the company's various brands. the book sales were down 15%. old navy fell 6%. cap namesake sales fell. that all of this weighing on the shares. the cloudt to mention company we would exit paid coming out with earnings. $.20 per share is what we're looking at. $.19 is what analysts had been anticipating. revenue is coming and short of estimates, very slightly. analysts were looking for about $481 million. for the second quarter says revenue growth will be 1.5% to 2.5% in constant currency turns. context is that shares have almost doubled over the past year. there has been a lot of speculation about whether the company might potentially be bought.

touted a strong computing customer base and focused on the higher end of the market. these numbers coming in line with estimates. that doesn't look to be good enough with traders here as we withhose share off -- traders here as we see those shares selloff. a $2.1 billion. merger, the deal values was in a at 2652 per share. a at $22.52oss at rosetta at $26.52 per share. , noble added 1800 drilling locations in two of the three biggest u.s. shall oil fields. int includes 50,000 acres

eagle ford. joining me is joe weisenthal and --omberg intelligence peter i'm the biggest groupie of you guys. peter: i'm excited to talk about rosetta. alix: is this the moment we have been waiting for? peter: let's keep in mind one transaction and one deal doesn't make a trend. this is the first big one in the space and we have a lot of observers asking the question is this the first of many? we are about to find out in the days and weeks ahead. shalls the turnaround of -- is this the sign that things are back? peter: oil prices have come off the bottom. exploration production companies raised their guidance and have been more often thinking about output in 2015. what that might do in terms of oil prices is add more supply,

which may pressure prices going forward. alix: this 38% premium, what did you make about the pricing behind this? peter: a lot of this is dependent on their reserves. is iny reserve for them eagle for it. these are the most prolific places in the u.s.. there is obviously a premium to be had for a very good acreage. joe: what are some other companies that people are now looking at? peter: the big question, of course. the key thing to look for is good acreage and we comments sheets. -- thateage entails sheets refer to people with liquidity problems. joe: can you give us some names? alix: unfortunately you probably can't. issue was oil prices fell and companies were being rated at a higher oil price.

peter: that is the big conundrum in this space. they are too wide. this is the first time where they actually met. or oil companies overvalued are vigor countries not willing to pay that much for it? alix: what was the catalyst for this one? is it saying rosetta isn't going to go alone and thought it was going to get. peter: it adds two key assets to the u.s. portfolio. this is a company looking to grow u.s. resource base. alix: a pleasure to meet you. thanks for helping me break down this bond market day. onhave a lot more coming up bloomberg market day. we changed our programming. stay with us.

alix: noble energy announcing ats purchase of rosett resources. noble will add 1800 german locations in two of the three biggest u.s. shale oil fig -- oil- wheel feels fields. she is director of ocean and energy management, joining us on the phone. the other huge news in the shall getting the green light potentially start drilling in the arctic.

sector the way for other companies to do the same? it is an important step forward for shell. approvale conditional have requires permits and approval from several other agencies. it is a good step for them. alix: 20% of the world's oil could be underneath the arctic. abigail: everyone in this adustry agrees that they play good one. my expectation is companies will wait and see how shell prevails. alix: what kind of price, how much does it cost to drill in the arctic and how quickly could oil come out?

abigail: it is obviously more expensive than established spaces. two ratesing to have of their over the summer if they received all of their permits. they are doing exploratory drilling. there are six exploratory wells. tina moore this summer and of summers. reserves itind some will obviously take more years for them to develop those. yearuld be a five or 10 commitment on their part before production is up and running. alix: it is not as if they are going to start drilling tomorrow. talk to us about what else they have to do to make this a viable project. abigail: he conditionally approved their exploration plan area a have to get permits to drill from the bureau of safety and environmental enforcement.

they have to get other authorizations under the protection act and endangered species act from the u.s. fish and wildlife service. and then there are a couple of permits from the state of alaska that are still outstanding. alix: take you so much for your perspective on this potential deal. abigail hopper, director of ocean bureau energy management. you have the global bond routes sending the 10 year yield to a 2015 high on friday. all of this comes as the u.s. gets ready to auction billions of dollars in coupon bearing debts. joining us now is the global head of fixed income strategy at j.p. morgan private bank. to aboutuy to talk this global route we are seeing in the bond market. what is the catalyst and where does it go? >> i think the deal that was

just spoken about in terms of noble and rosetta points to another part of the bond market that is doing really great. that is the u.s. high-yield market. the high-yield market has held up very well in spite of the backup in treasury and is actually up 4% for the year. there are some parts that are doing worse and some doing better. is the risk-free assets, the sovereigns, the u.s. treasuries, that are doing worse because the rates have gone up. the credit markets in terms of high-yield are actually doing fine for investors. alix: what is the risk of greece , say you have central banks rising? phil: that would be our concern going forward, a repeat of 2013. with the tapered tantrum of 20 roseates arose an off -- -- the rates rose enough to appoint where esau a selloff.

-- where we saw a selloff. one of the reasons it hasn't is one of the reasons why i'm a bit more constructive on rates settling down. if credit markets had decided i'm out of here because this is going to be a permanent thing, we would be more worried. one of your prior people spoke about technical. perhaps it is and we are going to find out in the next week or two. alix: what is the best sector? i look at the energy. phil: that is a little dependent on oil prices. in terms of u.s. credit markets, one of the ones we like a lot are u.s. banks preferred. terms of bank prefers, they are technically dividends paid they are very advantageous from a tax perspective. to see thentinue bond route unfurling here. the global head of asked income

strategy at j.p. morgan private bank. coming up on bloomberg market day, we are going to talk to the ceo of noble energy and that $2 billion deal. he will talk to david silver coming up next. will talk to david stover coming up next.

alix: welcome back to the bloomberg market day. it is that first deal involving a major u.s. company since oil noble collapsed area energy buying rosetta resources in a stock deal valued at $2.1 billion. on the phone for an exclusive interview is noble .nergy ceo david stover thank you for joining us on this merger monday. why now? why was right now and a 38% premium the right time and price?

down --t all comes comes down to do you find the right opportunity and can you reach an agreement at that point in time? right now there was an to put us into two new unconventional plays in texas. it is two areas we have been looking at for a couple of years now and developing some understanding of that. it just happened you have the conversation that allowed you to pull this together and set it up so there is running room for shareholder basis. an opportune time to pull it together. been a big spread between the bid and the app. the sellers want higher prices and buyers want lower prices. what was it about this current environment that enabled you to

come to an agreement with rosetta? david: it is mainly around the the deal.and and all stock transaction, like you said. that enables both companies to benefit in the larger combined company, the ability to do that potential toupside any price movement as well as .rice protection is somewhat the timing but it is really the nature of the assets you are combining. alix: what to next? block.e a 56,000 acre our going to see some -- david: our focus right now is integrating the two companies and focusing on the execution of what we see in these asset basis. themselves right now

they are very material and have a lot of running room. could they lend themselves to additional opportunities, we did that kind of thing in the basement -- in the basin. one of the key elements is larry did a transaction in 2005 and layered beyond that. these types of things, if you get a foundation in here and a leadcore area, they could to future opportunities. the focus is on executing. the: david einhorn called players mother frack spurs and that they are not producing the free clash for -- free cash flow they would like to see. david: at think you have to look at the opportunities that are in front of you.

one thing we talked about on this asset base is we can still --nificantly crow this asset significantly grow this asset. whatever the position this is a good time to get into these assets. alix: when taking a look at the oil price, do you think the next move is up or down as we trade below $60 per barrel? think -- david: i don't think any of us could predict that if we wanted to make sure we could strengthen our part leo that critics -- that could withstand fluctuation in price from either direction. that is why we like a diversified asset lease. it is all about managing risk. alix: thank you so much for joining us. buyout.lations on your david stover, ceo of noble energy on its $2 billion acquisition.

that does it for the first market day. we will have many great days coming up. the wonderful evening. -- have a wonderful evening. ♪ . .

announcer: from our studios in new york city, this is charlie rose. ernest tony's is here, the secretary of energy for the united states. he has been negotiating with his iranian counterpart. he's a professional -- a professor emeritus at m.i.t.. he's taught there for 40 years and led the -- led the department of physics. he served in the clinton administration's undersecretary for energy and in the white house office of science and technology policy. for all his reasons and more, i'm pleased to have