alix: this is the bloomberg market day, i'm alix steel. we have stocks falling for a second day, you have the dow up but let's put this into perspective. at one point, the dow jones was up by 180 points at its session finished lower by 37 points. anding a five-month high

that bond route coming to a little bit of applause here in the u.s. joejoined now by weisenthal. if we dig a little bit between within the s&p, you saw energy have a big run and you saw telecom flip into positive territory while materials and health care really lagged. the energy story is interesting -- energy, which everyone thought was finished and was going to crash and here it is again, a solid day. a rotation outg of safety names like health care, financials into riskier place -- riskier plays. joe: that coincides with the reversal we saw in the treasuries. health care is an interesting

day in that respect. alix: we have this pond selloff and then today, the question being hosed is what is this? is it a sign we are seeing inflation in the market? is growth starting to prop up or is it purely a technical trade? bank of america says there's something going on here. joe: there is this idea that it started in europe and the idea europe is coming out of its deflationary time, but it seems to be something more because it has been so global and it's not just the fixed income. thing that there hasn't been a dramatic reversal on is the sovereign's. alix: we had the new york fed president saying today that the fed's first ratings increase will usher in a regime shift that will stir financial markets.

you don't want a fed official they that. joe: it is interesting because it coincides with some of the warnings janet yellen gave last week. the fed is not signaling a rate somethat it is using language that could make markets a little more cautious. we have seen tremendous volatility in the bond market to the highest level since that you have tond wonder how that winds up affecting other asked that's. assets. is startingd market and people are trading the currency market as a way to move against the bond market. somethingworthy and we haven't seen, the equity market tick yet.

alix: we also have some m&a heating up. we have seen a lot of chatter. we've seen a lot of analysts saying aetna is going to be cigna.humana or some m&a speculation coming there. also that it could be bought -- and i bring that up because it is an industrial bellwether. you have a big bellwether deal and the m&a continuing in these all other sectors. year, we have been talking about health care and the pharma sector. someone is making a bid for someone or out bidding and when else.

and what happens when the fed ends up raising rates. let's get the money at lower rates and what are the effects? be something where there is energy to borrow now before the fed raises rates. the event of the fed raising rates is not going to be the big market event people expect. it will be the pace of rate increases or how far they go to the terminal rate. velocity to your point than anything else. do you think the m&a has been mass -- has been masking any weakness in the stock market? we have had the m&a which could be supported. joe: there is probably that idea that there are so many companies and pay -- in play and they have some dry powder. alix: good to see you always.

speaking of stocks moving today, newshares jumping on the it is being acquired by verizon. look at that job. the deal gives verizon aol to technologies that should streaming service and its mobile advertising abilities. the chairman and ceo of aol, tim now.rong joins me congratulations on the deal. a big day for you guys. >> am really excited to partner with verizon. it is a big day all around. we have been reading reports that it will be its own entity. how will you run it and how is your relationship with the verizon ceo? guest: the deal is targeted at a few different things. was constructed around

that and with conversations we with micksat down adam and we have an egg -- we had a great discussion about that inserted talking about operational things that led to a deal. my role is to help drive the future of businesses around driving digital content and video. i'm committed to being there for an extended time, for multiple years and i think we are excited to take our assets and put them together and we will be running a division of the company which --one of the future arrows future places where we expect to get that from. i think we will bring a lot of energy and focus and the verizon people, we have been close to for a long time and we are good partners with them and have been for five years. we are really excited to go over

there and we will be connecting to the innovation group and we are looking forward to getting a deal done and finalized. brand group is getting a lot of content -- duty a lot of attention -- whether it's engadget, techcrunch or huffington post. what is verizon's interest in that it might we see the expression of those rands in different ways? tim: we have been building brands that are global in nature. great distribution platform and partners in distribution across the internet and what you will see from our group is more investment in the brands, more investment in video and scaling audiences. has done the same thing,

nfl content and premium content on one side and video content delivery network on the other side. the strategies are similar and verizon is a big believer in content. here for right side content and platforms that measure -- that mirrors verizon's visit -- does this. cory: i wonder when you look at the platform business, this is something that has been happening somewhat under the radar in terms of acquiring the full staff for the minute they have an idea and wanting to it doeshow well measure. do you think that spurred the timing of this deal?

tim: i think the results we , verizon new what the strategy was and i don't think the deal is predicated on individual data trading. it was predicated on what the assets and strategies were. another egg part of the deal is when you look at the results that did show, a lot of them .2 video and mobile. companyis a much larger with larger success in terms of delivering content and ads and services. you are taking one of the largest in a companies and aol and one of the largest companies in the world with verizon, put them together and it's going to to do thatability and aol has done a good job of building the company up. that's why we are doing the deal with verizon.

jumped on thek news, trading over the purchase flight -- over the purchase price. tim: my focus and concern right now is basically running the company day today, integrating and planning with verizon in terms of getting ready with the deal. as any company does, there's a responsibility to shareholders but i think we have done a very good job fulfilling our responsibilities to shareholders -- our stock the last five years has been s&p 500 and we have turned the company around. investors got what they paid for and i think to go forward if someone wants to get involved, our plan is to make sure we deliver what shareholders are delivering in this deal. alix: thank you for joining us

on this day. tim armstrong and thanks to cory johnson. "bloomberg market day" will be right back. ♪

alix: welcome back. for more on the after-hours markets action, want to go to julie hyman at the breaking news desk. with: go daddy coming out the first earnings report since its ipo on march the first and it looks like earnings are coming in better than estimated. it lost a penny smaller than estimated by analysts and ,evenue, which was up by 17.5% estimate. revenue and earnings, looks like eating estimates. the company also talking about some forecast for the second

quarter. being revenue is going to $395 million. analysts estimates was on the lower end of that were cast. firstdy, looks like the earnings report on a relative aces is a strong one. also numbers coming out from a big drug distribution company topping estimates by $.20 a share. estimates,sing almost in line but a little shy of estimates. 19%, and the company coming out with a forecast for the full year. we are also waiting for earnings from zillow and we will bring those to you as a cross stop let's get to the top stories at this hour -- secretary of state john kerry is wrapping up a press conference with the russian foreign

secretary and met earlier with vladimir putin. it is the first time they have had direct talks in two years. john kerry posted on his twitter page after speaking with putin that he had frank discussions with the russian president on key issues. senate democrats get in the way of president obama's transpacific trade deal. voted 52-45, 8 those shy of the 60 needed to proceed. any democrat a the trade agreement would hurt u.s. -- would hurt u.s. jobs and wages. secondth toll from the earthquake in nepal is at 42. more than 1000 are injured. was in parliament session and a camera captured the moments when the earth first began to move and captured leaders dashing to the exits.

the you not -- a united states marine helicopter assigned to relief efforts has gone missing. a defense department official says it disappeared near one of the villages hit hard by a quake on tuesday. u.s. treasuries erase earlier declines following a slide that pushed 10 year yields to a five-month high. what does this say about stocks in the global bond route? let's bring in a multi-asset class chief invested officer -- chief investment officer. earlier,aking with joe talking about how the global bond selloff has not been infecting u.s. stocks. why? guest: what you have seen as severe volatility in the bond markets and volatility is all in a pretty moderate range. growthrs are reassessing

prospects in the u.s. where they are moving those growth expectations, realizing the translated ton europe, translating to a significant change in bond prices. what has gone on in bond prices valuationsundamental we expect in the bond markets, we just do not expect to have them in three weeks. are we seeing a re-rating between u.s. growth coming down and where is the best investment? i like the picture of european growth coming up, but i think we will see american growth come up off of this week first quarter. in a stock market oriented world , where the united states goes a little higher toward a 3% trend to aurope recovers positive number which in itself youd be a huge success, start to see a transition into emerging markets.

ratesrt-term interest stay low, they don't have to stay at zero. imagine the discounting mechanism was short-term interest rates. you can make abled case for stocks and many markets. have seen ahough we rush of money into the u.s. stocks -- where is the value? 12 month think on a horizon, stocks will be higher. even if they tick up a little bit, where we see attractive what is tied to the economy after this slow patch, we like that. we think there are pockets in emerging markets as well. i want to find out where

the risks are in the market and what you need to avoid. you are watching "bloomberg market day." ♪

alix: this is the "bloomberg market day." .y guests are still with me you just heard the case before the break about small caps and risky assets. what is your call? we talked about it during the break -- you've got a picasso indicator -- rising prices, low, low interest rates that drive all asset prices higher. the mechanism of pricing an asset is a discounting mechanism of an interest rate. that's the most enduring component and interest-rate are

low and they are going to stay low. dirty basis points, the 10 year yield is not a major trend change, and i would be interested to see if it goes the same way. if you have this negative interest rate policy in place for a trillion euro in the second largest reserve currency in the world, it's going to be there for another year and a half and is going to suppress yields and it up asset prices. do you agree? guest: that is our base case view. that central banks have their thought on the scale globally, wereuring the break, we talking about what are the risks and what are you concerned about? our fear is what if the swiss forecasting a secular deflationary environment of stagnation with low to

moderate growth. alix: that's something that comes up in the oil chatter quite a bit. is it new demand or is the supply falling off? that makes a difference. to answers impossible without enough time to look backward and i don't know how to get up there and look backward. on the point of interest rates, we have central banks that can set and interest-rate anyway they want. when you look at the yield curve aced on the actions of the central bank, you could say safely that's not a forecast for the weakness. whether i agree or would do it differently is not the issue. alix: what are the risks as you see them? guest: major change in central bank policies that go from

leaning toward easing and very gradual exit too hard tightening, to fighting inflation which has not yet arrived. that's a huge game changer. what about emerging markets? we worry about the taper tantrum , but it doesn't seem to be reflecting that kind of thing. guest: emerging markets are facing a number of headwinds. weaker growth around the world hurting manufacturing, so it is rare and appropriate emerging markets have struggled for a while. we think china is not falling off a cliff. maybe it stabilizes at 6.5% growth. think you can take that risk out of the equation when you are thinking about emerging markets and, given the selloff we have, there's interesting opportunities there.

guest: fully agree. we are overweight in emergency room -- in emerging markets and we favor asian emerging markets heavily and other places in the world, very carefully. we have chosen to express the view heavily toward the debt side. hardrily on -- primarily currency sovereign bonds, we think that's an attractive position. we are more neutral on the equity side of the equation. alix: is commodities a risk? guest: commodities is almost the next essential risk. it is pricing in the secular deflation story. was at 49 and overshot low, at 60, it may have overshot the other way. i think you will see some more volatility once again igniting some of these slowdown fears. for staying with

me. a great pleasure tsee you as always. tomorrow, it up, but the heavy coverage of retail sales out in the morning with earnings from jcpenney. i'm alix steel. good night. ♪

announcer: from our studios in new york city, this is charlie rose. -- charlie:m is here. he retired from the cia after 33 years of service. he played a central role in some of the most pivotal events and recent history. he was with president bush on september 11, 2001 and was in the white house situation room the day osama bin laden was killed. he writes about his experiences and counterterrorism missions in a new book called "the great war