alix: we are melissa way from the closing bell. this is the bloomberg market day, and i'm alix steel. ♪ you are looking at stocks deteriorating a little bit as we head into this close. the dow now off by 82, and the s&p off by 13. you are looking at a dow closing at a two-month low, the biggest three-day losing streak since march. we are looking at stocks closing

for the dow around the session low. joining me now is joe weisenthal, bloomberg markets editing manager. part of the story was stocks like airline stocks weighing it down. as transport goes, there goes the dow. joe: and it was interesting to see one of the biggest companies in the market have its biggest day of the year. -- apple conference alix: you thought it was boring? and it goes down earlier and it sort of ended flat. it was not one of the more memorable ones. what i was looking at, of course, is deutsche bank. it is kind of the story of the whole weekend.

the stock went higher on reports of the ceo shuffle. the goldman sachs pointed out this morning that it was skeptical, saying this positive reaction we saw today could be short-lived. the struggles with the company are really about structural issues rather than management related. at the end of the day, there is return -- a- a real real lack of return on equity investment. joe: and there is interesting subplot here. you have another huge player its balanceinking sheet, some another entity that can absorb less. and it's interesting to see this story of deutsche bank. , the german dax is one of the hottest markets of the year in the meantime. receiving this whole qe trade and the dax is down 10%.

alix: and there was a note out from bank of america saying of all of the countries we are seeing improvement, that is one area we are not seeing it will stop they have exposure -- seeing it. to severalxposure places. story-- joe: suddenly the about germany seems to be changing a little bit. alix: a story that is not changing, greece. the greek finance minister spoke today. take a listen. varoufakis: history will take you down is a failure of the political class and the european union. alix: if you think the crisis in

greece will end soon, think again. joe: we should revisit it in a couple of weeks and see where things are. meanwhile, a developing in -- development another area, turkey had an exciting election. it was quite a shocker. the party of president air to erdogan didident air to not do how people expected. and we saw the turkish lira plunging against the dollar to the lowest level of all time. submarket soria was amused by my the turkish company that makes the riot trucks that are used to control riots, crashed. it was down by 21% at one point. a massive crash in the company that makes the riot trucks. i found that to be fascinating.

alix: the ideas that we will see more democracy and more stability. joe: long-term, it's good, but investors hate uncertainty. alix: it has been set in the past that this bodes reasonably asl longer-term and perhaps a destination it will be more attractive and turkey will be able to draw more money and, in essence, propped up its economy. joe: and here with us to talk about this is scott wren from st. louis. and here in studio, lisa abramowicz. scott, let's start with you. turkey, do you care? is this something you are watching and is this important? what do you think when you see bigs like this in a emerging market? scott: it matters in terms of what is going on in the middle east. a lot of fires over there and

with political uncertainty, it's definitely something to be concerned about. but not what we are watching day today when we are looking at equity decision strategy wise. joe: lisa, what about you? contagionhere a triple down in these kinds of incidents? lisa: i think it was mohamed el-erian who said it's not fair to paint under one brush anymore under "emerging markets," because there is this bifurcation within the emerging markets with the winners and losers. venezuela,rkey, certain countries that have really struggled. and then you have mexico that has been everyone's favorite for a long time. you are seeing some outflows for emerging markets for the first time in a while. perhaps it has to do with writing benchmark yields. alix: and this strategy that we are looking at on the screen. talking about bond volatility.

are starting to shrink. they were at a high of about $12 trillion last august and are now shrinking by about $400 billion. the result is that there is literally less money from government of can recycle into the bond market. lisa, what does that do for the liquidity issue, or lack thereof? for: it's a big concern people. basically, this has been one of the bright spots. people said that emerging markets will not be that bad because they have hard currency reserves they can use to pay back their debt, you know, record volume of dollar denominated debt should they have to. the problem is, as their currencies we can in response to a stronger dollar, will they have sufficient reserves to bolster their currencies as well -- this record volume of debt? joe: scott, what is your take on this? do you worry about the bond of

liquidity issues and whether this will be exacerbated by the decline fx reserves? scott: i do worry about that. ofm my perspective in terms equities, performance this year -- and i'm talking about dollar-based performance -- i would still say large u.s. cap -- large-cap u.s. stocks and then developing natural, and -- anderging markets developing national, and emerging markets in third place. all of the emerging market debt , andis owed in dollars lisa is a godly right, the market is going to be worried if the dollar strength -- lisa is absolutely right, the market is going to be worried if the dollar strengthens. that's where the market gets worried. and worrisome markets generally selloff.

-- generally sell off. will the dollar hurt these emerging market? as far as the payback of their debt. and the emerging markets, i'm -- i don't think it's too much say we had a collapse there. and wait for getting back to somewhat more normal than where it was. stocks emerging markets are at the bottom, but we don't need emerging markets to buy our stuff. we are interrelated. scott: that is right. when you look at the earnings puzzle, 47% of revenues come from overseas. we need china to buy our goods. we need emerging markets to do ok. we do eurozone to grow. and i think it will grow 1.3% or something like that. those are all parts of the earnings puzzle that we try to

put together to come up with the or earnings number. we need the rest of the world to participate. will beit will, and it modest, but it will be slowly moving in the right direction. lisa: one thing i found interesting is today we had more data coming out of europe that was better than it did. and excitations are for to keep writing -- keep writing. -- rising. inflation expectations are picking up. as discussed point, people are seeing signs of inflation around the world and not just in the u.s. joe: i want to turn to stocks. we keep having the debate about whether we are in a bubble and stocks are overvalued. here is a quotation from bob doll.

scott, what do you make of that? are we entering a phase that is not as good for that? scott: stocks were undervalued for a long time and docs have moved a long way in the past five or six years. -- and stocks have moved along the past five or six years. i would argue that the book of the market has stayed here. we need earnings growth. 2017,ear probably through we will see 6% to 10% total referring -- total returns this year, and our biases at the top of that range. i think the bull market need to advance as earnings move forward. i think we will see that. stocks right now are pretty close to fair value, and then are the reason we all out. -- and that is part of the reason we stalled out. scott, thank you.

he will be staying with us. lisa abramowicz, thank you. ♪

alix: welcome back to the bloomberg market day. i'm alex steele. but get you caught up on the stories making headlines this hour. a grand jury has indicted a former police officer on murder charges after the shooting of a black man was captured on video. north charleston police department fired officer michael video several days after showed him shoot the man eight times as he was running away. speaking at the news conference, german chancellor merkel said "we are ready to intensify

efforts of the situation requires it." here is president obama speaking. president obama: there is strong consensus that we need to keep pushing russia to abide by the terms of the minsk agreement. we need to support and encourage ukraine to meet its obligations under minsk. and until that's completed, sanctions remain in place. alix: the g7 sanctions will remain in place unless president vladimir putin honors the peace deal he helped to broker in ukraine. has secured and showtime service will begin in july and cost $11 a month. it will allow viewers to watch without signing up for traditional tv.

yea, homeland. and netflix is teaming up with actor brad pitt. the company will produce "or machine," a satirical -- "war film witha satirical brad pitt. those are your top headlines. from st. louisw is scott wren, senior global equity strategist at wells fargo investment institute. is negative on the year, but you are looking at 6% to 10% total returns. where are we getting this? earnings growth will be what drives it. a better economy here. better, but a little bit better will drive it. and europe will also drive it. right now, looking at earnings estimates, and coming into the least in our opinion

the convinces estimate was too low. it was certainly too low in the first quarter. the consensus estimate was too low. it was certainly too low in the first quarter. virtually every quarter i think we will see the consensus move up. the full year number is going to be higher as a result. there is a lot of uncertainty out there right now. and as you may choose, this market selloff makes people nervous, as it naturally would. and i think greece will be kicked down the road for a later date. given that we are pretty much essay or value, we are just trying to find our way. ofre is a little bit low-volume tray going on, but earnings and a better economy, and the fed not doing a lot is what will take this market higher. you mentioned the bond selloff. let me get your take on what leon cooperman said over the

weekend. he said, i think the market is ok, but it's not cheap, but not price to perfection. and what point does that trickle down and affect stocks? european bond market was an absolute bubble, at least in my opinion. the you is -- the u.s. domestic market, by year-end our range is 2.25 up to 2.75. we might lean to the other end of that particular range. i think that is ok, because we are in a normalization process. the bond market and the fed and the equity market will have to digest is. this is a multiyear process. if we are going to grow 2.8%, which i think we will this year -- that is our gdp number. 2.25 andyield is at

that is to you low -- that is too low. you would expect that the on market would trade a little lower and yields would rise a little bit. but i far as a big selloff, i'm not sure what would trigger that. there is less windy, no doubt. and that is why i think we can , nomore -- less liquidity doubt. and that is why i think we can see more volatility. but we certainly want to stay invested in equities. alix: i should point out that we are looking at a doubt that has not had a negative years since 2008. the one thing that stresses you out? allt: usually, they're kinds of things that keep me up at night. alix: pick one. scott: chinese growth. me. is what worries we see that drop off quickly and will we see a financials is an issue, a banking issue, a buyout loan issue in china?

-- a bad loan issue in china? that is what is keeping me up at night. scott wren, good to have your perspective. coming up, we will hear from general electric cmo. do not miss it. ♪

alix: welcome back. i'm alex. general electric is getting into the business of storytelling. is reeling in the social media. betty liu spoke to the general electric cmo, beth comstock, from the summit in montauk. guest: we like what we are able to do because you are able to singular way.ry we were the first on instagram

in 2011. it's a beautiful the photography you can use to bring to life about how ge things are made. recently, we've been doing much more with snapchat, even with micro-messaging platforms. i think social media right now is pretty exciting. i am particularly excited with where full throttle -- where virtual reality is going. we have been able to create an immersive experience for the customer, for the fan to be able a jet what happens inside engine. this is what happens inside your brain. i think that's really exciting. betty: on. media platforms, how do you measure success? us, a lot of it has and around ge's efforts to get into data analytics and ge

becoming a software company around the industrial side of the world. for us, to use social media to go after's bios -- to go after cio's who are making engineering decisions, and to go after we want to come right code at various ge businesses. it really depends, and often you will look at one platform that can serve a multitude of needs and audience is -- audiences. right, as you say, needs at ge. -- anyone move the needle moved the needle the way and add 10 years ago would have four ge? hard tot's say any one platform, but in concert you are looking for amplification.

to make a 32nd -- second tv ad more impactful. it's the same thing you are trying to do brand marketing. betty: you worked at nbc. bet a big part ofh: given how maybeant storytelling is, ge should have kept nbc. : i don't see a lot of that coming into the mix. moreou will see storytelling going forward. betty: brian grazer and ron howard are producing this with you. is this some sort of new model?

by which ge will advertise? i can point to ge's history in the late 1950's and andays and -- and 1960's there was ge theater. that is how ron howard got his, in a ge theater. great time in history when we have been part of the stories. for us, it has been part of the stories. us tellgoing to help great science stories. that was betty liu with general electric chief marketing officer that comstock in montauk. thanks for watching the bloomberg market day. i'm alix steel. have a wonderful day, everybody. we will see you tomorrow. ♪

>> from our studios in new york city, this is charlie rose. we begin with a reported hack of millions of personnel records from computers across the federal government. it may be the largest reach ever of u.s. government networks. china istors suspect behind the attack, and accusation china denies. davidn this, we turn to sanger, the national security correspondent for the "new york times." let me start with the basic question, how serious is this? how much damage does it do? david: