>> your got american express set to report on executive l. it will take a look at the turnaround plan following the loss of cosco as well as big layoffs. betty: donald trump has searched to the top spot. h'll get insight from doug ye. scarlet: good afternoon everyone. betty: let's begin with a look at how markets are trading. an upset stomach for bowles today. the s&p, the dow and the nasdaq trading lower. this is incredible. a company that says they have grown revenue by 30% plus still

sees a stock selloff. scarlet: the rules are different with apple. the stock is pretty much near intraday low. betty: also what is dropping is crude oil. nymex now hovering at $50 a barrel levels down 1.5%. inventories came in as they do every week up 2.5 million barrels. it shows inventories keep piling up. aboutt: no question demand. plenty -- 20 of supply. let's take a look at what is going on in the bond markets. a weaker stock market so you would expect to see a stronger bond market and you have that at the longer end of the yield curve. higher prices means lower yield. the two-year, holding around 70 basis points and is actually higher which means prices declining. in currencies you mentioned the selloff in commodities. take a look at what is going on

here. the yen stronger versus the dollar. dollar yen at 124. this is the japanese yen versus the other major currencies. what you really see is the yen plus strength versus commodity currencies. dollar, aussie dollar, canadian dollar. a lot of movement to save havens like the japanese yen. this has been putting pressure on some of these countries. betty: a stunning reversal of viewson the global -- of on the global economy. scarlet: it all comes down to when is the federal reserve going to make the move to raise interest rates. betty: for years the housing market was a big part of the problem as america tried to

bounce back from the great recession but new figures show it is now a part of the solution . sales of previously owned u.s. homes climbed to an eight year high. the national association of realtors says closings increased by 3.2%, a rate of nearly five -- 5.5- 5.5 million billion. pay increases in hiring our sparking the housing recovery. while low mortgage rates are helping those shopping for homes, they face supply. sales are up by nearly 10% in the last 12 months but listings have risen by 4/10 of 1%. oil inventories rose last week keeping the price of west texas intermediate crude around 50 dollars a barrel. oil's rebound from a six-year low slowed down on signs the glut will persist. a stronger dollar is putting pressure on oil and other commodities. scarlet: the banking system increase is getting more

support. the decision came from the european central bank. the ecb is raising emergency liquidity assistance for greece by almost $1 billion. alexis tsipras sat down with taking leaders while parliament debated the second phase of austerity. creditors want more reforms. the new finance minister is urging lawmakers to pass the plan. have for thee will negotiation of the new deal, two weeks, three weekends so it is important to finish with this procedure of prior actions so we can start negotiations this friday. i am asking you to accept the demand of the government for this procedure. the prime minister is counting on lawmakers to pass the plan. members of his party opposed a new round of tax increases. the country's biggest home-improvement chain is getting bigger. home depot is buying interline

brands for about $1.6 billion in cash. into my markets says distribute -- goldman sachs, capital partners and p2 r. betty: at&t's plan to buy directv getting the processing -- the blessing of regulators. urging --airman is the fcc wants the company to work harder on expanding broadband use. amazon is expanding home services program to 15 cities. home services is a challenge to user review sites such as yelp. customers can use it to find people to paint their homes, install home theaters or give guitar lessons. in march, amazon home services open in new york, los angeles and seattle. those are your top stories at noon. scarlet: the shine is off for apple as investors digest third

quarter results. the company posted record profit but iphone sales and revenue forecasts missed estimates. the stock is posting it biggest post earnings drop in more than two years and is still getting punished. faith. no time to lose >> unfortunately it is something that happens with a lot of successful companies when they start to train investors to expect this big upside. i think it is a curse on days like today but ultimately it is an opportunity. for investors who believe in what is going on, the bigger picture, market share gains with the iphone, if you believe in that you have to put up with volatility but ultimately there's an opportunity to own the story at a discount. betty: apple drags the entire sector lower today. here to talk about apple's not so shiny quarter and its impact

on broader markets is tim higgins who covers the company from san fran and mike reagan to get some perspective. as we were talking about a few moments ago, this is a company that just reported record profit. china sales up over 80%, revenue up 33%, cash at $200 billion. is this not the most confounding reaction to a great earnings report? tim: it is almost classic apple. they beat expectations the shares soar and the rare occasion they do not meet expectations they get punished in the market. part of it gets to the investor belief and looking at these numbers to say how the iphone line is going to do over the next 18 months or so. there is concern that iphone sales have peaked at record levels and this is only downhill. betty: what are the indications? have they peaked?\

tim: the company sees a lot of potential in china. they feel like there is a large percentage of people who own old iphones but have not upgraded and they say they are turning android customers at a great level. they feel there is a lot left in the product. some of the issue as we get into september, later this holiday season will be the next iteration of the iphone. by all accounts it will not be a revolutionary device, more evolutionary, kind of the pattern it follows after a big launch such as what happened last september. investors and analysts are wondering if they can match the record level of sales they had in the holiday season last year which really drove a lot of the success they had. scarlet: the world's biggest company. people are talking about a $1 trillion market cap for apple. it is heard by the law of large numbers.

it continues to post astounding numbers nonetheless. apple is a victim of its own success. mike: a strange phenomenon that happens when you get to be a company that big of a share of the market. we had a visit from doug ramsey and he calls it the 4%'s club. when a stock is so big it accounts for 4% of the s&p 500, it has a hard time going higher than that. you discussed buying at a discount. apple has been trading at a discount for a few years now. if you look at the ownership among hedge funds and mutual funds, they own a lot of apple but they are not up to 4%. big institutional investors are wary of making one stock too big of their portfolio. it gives you risk to one company , one single product. it is a remark will stock.

it has all the profiles of the gross stock and trade luck a value stock. betty: does that mean the traditional parameters by you would buy it -- gene munster says it is a discount now. does that mean traditional parameters do not apply to apple? mike: so many do not apply to apple. it -- some of the laws of big companies, large numbers apply. once a company gets that big it is difficult to continue rallying. it consumes too much of a share of the market for people to become double with holding 10% of your portfolio in apple. scarlet: as we talk about apple missing estimates, the question is whether this myth is like last year when investors were quick to shrug it off and move ahead bullish projections for the company or is it more like 2012 when concerns about the iphone's long-term growth not

the stock off -- knocked the stock off? tim: the part of the reason there are such great interest in how the apple watch was going to do in the first quarter -- apple did not release unit sales results of the watch. they said they were not going to and did not. they want to have the opportunity to grow it and not give competitors insight. if you back out some of the increase in reveling -- revenue, analysts are estimating there was 2.5 million sales. at the low end that would not be meeting expectations. the suggestion is maybe the watch is having a slow rollout. maybe it is not deemed as beloved as previous apple products. there is concern apple is having a harder time innovating going forward. scarlet: what are you hearing in terms of what the company needs to do to ensure the apple watch becomes an iphone as opposed to an ipad that had a good start but has seen six straight quarters of falling sales? , sources tell us

apple is working on a larger screen ipad perhaps will come out later this year. it will perhaps appeal to the business community looking for a laptop alternative. tim cook is bullish on the future of ipads. once they figure out the upgrade cycle a lot of people will want to upgrade. for the watch, the feeling is the apps are not there yet. a lot of apps that the punch has not been improved in the market yet. they're coming out with an -- thatto the software notwatch has -- that have been improved in the market yet you by all accounts it is doing better than the first few months of iphone back in the day. it took a while for iphone to ramp up to become the ubiquitous product it is now. the apps community took a while.

apple andside of seeing that we see microsoft down, ibm tanking yesterday, is this the tech bubble bursting even if it is really not a bubble in the public markets? -- itapple was forecast is always the main event in tech earnings accounting for pretty much all the earnings growth we see out of the sector for this quarter. long-term prospects are pretty good. i looked at numbers on compounded annual growth rates in earnings going for the long-term, three to five years. the tech sector forecast to produce 4% earnings growth over the next three to five years, which is not quite the highest consumer discretionary and health care arts but to do better. -- health care are expected to be better. betty: thank you so much. next halfahead in the

hour. nado.er sequel to shark we will talk to the head of the studio that produces the film. scarlet: kent donald trump's popularity in the polls last? ♪

scarlet: welcome back. betty: let's get a check on how the markets are trading.

julie hyman has a lot more on some of the performers including intuitive surgical. julie it is up more than 10%. the maker of the da vinci surgical robot. we have been talking about earnings movers today. earnings beat estimates. worldwide da vinci procedures growing by 14%. as analysts point out, gross margins improving at the company as well. that is helping shares as they surge in today's session. we have been talking about chipotle. the church rectory has been interesting because it -- the trajectory has been interesting. rising 4.3% in the quarter. shares rebounded, trading near record today. after the company said it was going to buy back shares. it says sales trends are

improving this quarter. seen the company had slowing sales in two dozen 13 and then we saw -- in 2013 and then we saw a rebound to double-digit growth. slowdown back to the single digits for chipotle. it has been raising prices. s shortage asarnita well. scarlet: headlines just crossing right now that halliburton is facing a u.s. antitrust hurdle over purchase of baker hughes. a purchase that had been valued -- $37.5million billion. betty: stocks down on this. scarlet: lowered in the last couple of minutes. moving into the red. it was previously barely higher. baker hughes taking a big hit.

julie hyman, you have been looking into this for a while. you have monitored this deal along with other transactions in oil services. julie: the plunge we are seeing in both of the stocks. much has not been as consolidation as you might expect in the energy complex after we have the decline in oil prices and concerns about the u.s. shale business. interesting here is that this big deal we have talked about now might see regulatory hurdles. scarlet: apparently the government is concerned the oilfield services industry would become too concentrated after combining the number two player and number three player. halliburton has proposed selling off assets to appease concerns but officials are not convinced that would be enough to restore competition. now down by 9/10

of a percent. baker hughes, off by 5.4%. out,: as julie is pointing we thought we would see more consolidation among the players but we have not. the governor is taking -- the government is taking a hard look at what assets will be sold in relation to deals like this. what conditions -- they are putting stringent measures. judging from the stock reaction, this is not good news for shareholders who are betting on this deal but it looks as if they believe this is something that is going to take a big leap. scarlet: this is not a done deal with the doj has done this. this is according to our reporting. given what happened with comcast and time warner cable, you wonder if the company might decide to walk away. we do not know that that is going to happen. perhaps that might be a next step to consider. betty: we have the directv

merger. that looks like it is going to head to fruition. much more ahead, cloudy with a .hance of sharknado scarlet: betty was totally into it. the third in the sci-fi channel's franchise. the producer will be joining us. ♪

betty: this is bloomberg market day. scarlet: killer shots are back with sharknado 3 oh hell no. >> i can sense these storms now. these sharks have a sent.

cent. >> sharknado's reported up and down the east coast. four is inarknado the works. now bests joins me joins us now. you cannot have planted this better. mick fanning fending off a shark attack. paul: it cost us a lot to pay the shargh but it worked out for us. scarlet: i understand the title of the movie and then you figure out the plot and the characters. some of the movie names you have produced in the past, mega , threeversus gatorroid headed shark attack. someone said sharknado and come up with something?

basically. thank you for saying our movies have plots. we are strong believers that for our types of movies you should know exactly what the movie is based on the title alone. betty: what is your expectation with tonight's premier? paul: i predict we are going to break the internet again. become aharknado has collective event for the world. even though we are not all in the same room watching it, everybody is participating through social media and having a great time. i think wednesday night is going to be another big night for sharknado. betty: so modest. i was telling scarlet, i think i was watching sharknado, the original one. and marathon in anticipation of tonight. , fun toiness of it

watch. have you spent more money as each film has come out or are your margins still pretty high with these films? paul: we definitely have spent more money as the films have come out. i'm happy to say that the first two were profitable. i would love to be able to tell you relatively they performed financially as well as they have in social media but they have not. contrary to wha people believe my toilet is not made out of solid gold. scarlet: how far along to you think sharknado will go? 5, 10, 12? paul: we are planning for 12. we already have the ideas. betty: thanks so much. ♪

♪ ♪ ♪

get excited for the 1989 world tour with exclusive behind the scenes footage, all of taylor swift's music videos, interviews, and more. xfinity is the destination for all things taylor swift. scarlet: welcome back to the bloomberg market day. let's get a look at the top stories making headlines at this hour.

isafrican-american officer the new top cop in ferguson, missouri. taking over as police chief from thomas jackson could this be was torn by by-line's last summer after an unarmed black teenager was killed by a white police officer. a federal investigation found systemic racism in the police force. congressional leaders and the white house talking about changing the way the u.s. taxes multinational corporations. both parties appear open to the positions on the matter. when issue being discussed, whether to get rid of the u.s. tax system of taxing companies on their worldwide income. the greek debt crisis is still a cloud on europe's economic horizon. theportfolio manager thinks immediate future looks bright. erro talked about it earlier today. >> this is a good time to be

looking at european financials given loan evaluations and where we are in the earnings cycle. betty: a positive sign for greece, the european central bank is stepping up its support for the country's banks, raising emergency liquidity assistance by a billion dollars. facingrton's takeover resistance from u.s. antitrust officials according to a person familiar with the matter. justice department lawyers are worried the oilfield services industry will become too concentrated if the number two and number three firms combine. stocks of both companies tanking in midday trade. warren buffett says it ain't true, he is not buying his own greek island. he denied reports that he and an italian real estate agent by the island of st. thomas southwest of athens. was made premature -- they will sell the greek island to buffett sooner rather than later. that is a look at the top stories at this hour.

much more ahead in the next half hour. we will look at how the slowdown in china could afford -- affect corporate earnings. american express set to report earnings after the bell. we will look at the company's turnaround plans following the loss of costco, their biggest layoffs at big american express. criticism of donald trump is flying after his recent criticism of john mccain. polls tell a different story. show himt poll results as the favored candidate for the republican presidential nomination. by a long shot. 24%. in today's op-ed in the wall street journal, the deputy chief cantorf to eric that if you are

going to get rid of trump, you have to take him seriously. serious scrutiny has been scanned. his undoing could be in the details. what if everyone treated him as the thing he is not come a serious minded candidate for president of the united states? doug, you say if you are going to treat him like a child, he is going to act like a child. the to: absolutely. it's one thing to talk about insoles and calls for apologies and phone numbers. we are all guilty of that. , theyoters need to hear need to hear specifics. i'm hopeful that we will have an example or in opportunity tomorrow. he is visiting the border. a good opportunity for reporters to ask them specifically, how are you going to pay for this wall you talked about? is this an open bidding process or closed bidding process? what will you do with the millions of people who are here illegally?

we have not heard any specific plans from him. until we do, we are going to continue with the name calling and insults and all the circus that is in a cup which anything. betty: what is the question you think could nail him? doug: we have already seen it. we saw it in iowa when he was asked about religion. he gave a flippant answer, talking about his little wine and little cracker. a lot of evangelical voters in iowa and south carolina don't like that. i've never asked god for forgiveness once -- the republican primary candidates talk about their faith a lot. the way he handled that is the first crack in the dam, but it's up to reporters and republican candidates to decide to challenge him specifically on these issues. betty: i'm really confused by the polls. we just showed one that had donald trump leading everybody else by 24%. a poll says trump is at the

bottom of all the candidates so far. he has a negative favorability rating in virginia and iowa. what is going on here? >> no surprise that republicans have problems with polling. donald trump has the highest negatives of anybody running. even higher than hillary clinton. he is somebody getting all this attention. attention is great and can bump up poll numbers come but scrutiny is what is needed. one thing trump should talk about, why did you donate to hillary clinton's campaign? why did you say barack obama was going to be a strong leader? it's not a path to the republican nomination. know: not something people that she has made comments like that in the past. -- he has made comments like that in the past.

rupert murdoch has been tweeting updates storm -- up a storm about donald trump. when his donald trump going to stop embarrassing his friends, let alone the whole country? which i'm sure is the sentiment among many republicans, such as yourself. why isn't anybody taking a bigger stand? >> every candidate needs to do what they can for themselves strategically to rise up in the polls as much as they can. a lot of this attention has been a problem for marco rubio who gave a great education speech that nobody paid attention to because we were talking about donald trump. rick perry gave a speech touching on race that nobody paid attention to because we are talking about trump. as the debates come, the first in cleveland, you will see candidates go after him specifically. ats incumbent on reporters the border to not just to say

what do you think about lindsey , but whathone number are you going to do to stop the problems with stagnant wages in this country? what will you do to reform our health care system? that is where we will see the emperor not only doesn't have any close, but doesn't have any answers, either. another conservative columnist in the early times writes there is an interesting ineluctableump's fate when you have a competition between two brands, a better brand tends to win. what trump is showing us that brands matter initially. eventually, voters vote for the -- they will not like clinton and go for bush. what is the lesson here in this whole trump thing right now? >> the lesson is the more

attention you can get, it proves the point to a certain extent that there is not such thing as bad publicity. unfortunately, it has hurt a lot of republican candidates and hurt the republican party and helps hillary clinton. she is not being a part of the conversation right now. a poll came out just today that shows hillary clinton is suffering innkeeper postdates, but we are talking about phone numbers and insults. -- in key purple states. betty: clearly, you have skin in this game, you have seen your election cycles come are you disappointed with how it has turned out so far? >> ultimately, as long as we take it seriously, pin him down on specifics, it will not

matter. go back to the shutdown that we had a couple years ago, it was a bad thing for the country, pretty embarrassing thing for republicans, it ended up not hurting us in the november elections in 2014. once we get rid of the circus and move past it, donald trump is playing the role of a bad professional wrestler who is trying to incite the crowd and that is working for him right now. when we are talking about serious issues and debating next summer and next fall, republicans will be in a strong position. scarlet: it might even be over by the first debate in august? betty: right now, he has no reason to get out. we are starting to see the beginning of the end of donald trump and the way to do that is through specifics. make him talk about what he is not couple with, what he doesn't want to talk about. specific policy, specific issues. if you want to be a candidate,

make them talk about what they don't want to talk about. that, we will see him start to go away. betty: thank you so much. ahead, can a secret menu pop-up sales for mcdonald's? some of the unusual items you can get at mcdonald's off the menu. that is next. ♪

betty: welcome back to the

bloomberg market day. let's get straight to julie hyman who has the big market stories. season as we had disappointing earnings from apple and microsoft. we are out of the macro driven market for now. and into the stocks driven market. the nasdaq down the most with those big disappointing tech earnings. take a look at the bloomberg terminal and the imap, the various sectors in the s&p 500, technology down the most, telecoms also taking a hit. oil and gas seeing a big decline. at the intraday movement in the s&p 500 energy index, it's interesting. aboutg drop that happens 15 minutes ago. that's when we got the headline

that there was some antitrust scrutiny coming for halliburton 's acquisition of baker hughes. u.s. enforcement officials concerned that the tie up could hurt competition. you can look at these stocks individually as well. look at baker hughes, now down 8%, a big drop after these headlines started coming out. is even if some ofton sells off its assets in order to get approval for this deal, the smaller players who by those assets might not be able to compete with the likes of talking-- while we are commodity related names, we have to talk about gold again today. still trading at a five-year low, down another 1% today.

it has fallen for 10 straight sessions, the longest decline we have seen since 1996. the fundamentals not changing on gold here. the outlook is for rates to go higher. inflation to remain in check. spelling a lot of trouble for gold. we are hearing from jeff curry who says he expects gold to paul $1000 -- to fall below $1000 an ounce. it a lot of bearish sentiment on gold at present. doesn't seem like there will be any change. betty: thank you so much. now, a look at the top stories on the terminal this afternoon. hbo simmons headed to according to the new york times. hbo will be the exclusive tv home for simmons.

his contract begins in october. a talk show will debut in 2016. he is among several high-profile departures from espn. developers proved they could remotely seize control of a moving car. the hackers demonstrated their software -- they were able to disable the accelerator and ,reaks and tune in the radio even though they were on a couch 10 miles away. a bill just introduced in congress aims to keep internet connected cars from getting hacked. some breaking news as walmart will start closing some of its 24 hour supercenters for a few hours each night. across ourt coming terminals. walmart is ending their overnight hours at some of their stores as part of a revamp of the company.

that is a look at some of the top stories at this hour. staying on retail, the secret is out. in a recent ask me anything session on reddit, a mcdonald's manager reveals that mcdonald's customers can order secret items. there is no official secret menu, but they welcome customers being able to be creative with their own years. some of the more popular choices , the land, sea and air burger. mcchicken and fish fi let. -- apple thymic flurry pie mcflurry. mcdonald's reports their earnings tomorrow. which one would you like, mark? how can i help you?

mark: you can get an egg mcmuffin with two burger patties on that. betty: exactly. mark: i'm interested in a free cardio evaluation. does this strike you as odd? betty: no. we went to mcdonald's a few years ago. i remember at the time, the head said to me, did you know that you can order up any combination you want? it's all customizable. mark: he just menu, betty liu. betty: it's hard to do it, but you can do it. story -- apparently, they tell a television on girl who was at starbucks and she wanted a certain kind of rapid

you know -- from apuccino. it shows you are really into the restaurant chain if you take the time -- betty: makes mcdonald's seem a little cool. mark: mcdonald's has been having problems with mobile app. people want to order stuff and they are trying to work some kinks out with that. betty: this raises some of the issues -- their menu is too cumbersome. it backs up the kitchen, the franchisees are unhappy. mcdonald's has been suffering all around. in japan, they had the beef issue. in china as well. here in the u.s., again -- i

think it's ironic that people are excited about a secret menu when they been talking about mcdonald's serving unhealthy food. mark: it seems to be doing well -- the secret is going to have to be consolidation of the menu. mcdonald's and other fast food chains will have to do that as well. one person who is disappointed -- every year when they come out -- they haven't had the make in an in a while -- mcrib while. he went to a mcdonald's on 3rd avenue and bought five of these things. they have had various product innovations. mark: is that what you call it? i can't make it at home. speaking of product innovation, the gop has a favorite bank in

virginia. in mclean, virginia. phil mattingly will join us to talk about this connection between this bank and the republican party. betty: a bank that nobody uses, except for republicans. mark: phil has an interesting story to tell us. betty: i will see you in the next hour. much more ahead on the bloomberg market day. releasingxpress their earnings after the bell. what will they do after losing their partnership with costco? ♪

betty: welcome back to the bloomberg market day. merck express reports second results after the close today. consumers into spending as amex is the first

credit card network to report earnings this quarter. we will see how the company's up after costco announced open amex for visa. guess who also dumped the company? are we going to get any sort of clarity on this impact from costco? >> analysts sure hope so. analysts are expecting not so great quarter profit and revenue. some of that is strength in u.s. dollar hurting profits abroad, lower gas prices meeting consumers are spending less areme -- credit companies getting less fully met the pump. american express, analysts want how the endcolor on of the costco relationship is affecting the company. particularly expenses. they will spend a lot investing in other products and marketing to get those costco shoppers to stay with amex. analysts hope to get a preview

and a sense of that today. betty: are they going to? will amex break that down specifically? mark: not sure. affects the company in several different ways. and theevenue side annding, that is not seeing impact until closer when the end of the relationship ends next year. the spending in the expense games are set to pick up later in the year. analysts are hoping for some sort of indication. we will be listening in on that call for more color in terms of what they are planning. betty: are we going to get some clarity from visa about this relationship with costc o? >> visa is tomorrow. until nexttake over as

year. we won't be able to get a sense of that until they -- until that actually begins? any commentary and additional details that both of these company's can provide about what they have planned is something analysts are hopeful for. it is still a ways away. betty: thank you so much. , it is a big earnings week. we will have results coming out sands.alcomm, las vegas stay with us. ♪

mark: this is the bloomberg market day.

a small bank in virginia you've never heard of is doing business with nearly every major republican presidential candidate. betty: the new trend of buying cyber insurance to protect against hack attacks. a business that could grow to $10 billion by the end of the decade. betty: halliburton's takeover of baker hughes is in jeopardy. the government may block the transaction, sending shares plunging. good afternoon, i'm betty liu. mark: i am mark crumpton. thank you for joining us on the bloomberg market day. worldtocks around the leading wall street lower following disappointing second-quarter results from apple and microsoft.