selloff, they are all well into the green. netflix is making a comeback. some changes that may put investors on it. olivia: we will hear from robert shiller on his outlook for housing. good afternoon, i'm olivia sterns here with alex deal. we want to take a look at the markets. were looking at a rebound of 100 points but we are off the highs of the session. part of the reason is this oil chart that we're looking at. you saw oil rollover a little bit. oil stocks have been holding up, but oil coming under pressure and dragging the market with it. olivia: that always trigger

is the question of our markets leaving equity market. our commodity markets leading the equity markets? i am looking at treasuries. the move index function, which measure volatility in the treasury market, thanks to alix steel for pointing this out. this shows the volatility has spiked so much in recent days, the last time we saw this was the flash crash from last october. let's talk about some volatility. you have to come inside by bloomberg terminal and look at a two-day intraday chart of the yesterday around 10:00 a.m. at spikes to about 52, and it is now down 45% since then.

vixevery 7% decline in the ca 1% rally in the s&p 500. that inverse correlation somewhat is playing out today. olivia: it is hard to keep track of. talking about volatility can live to look at the currency market because it had a crazy move today. 110 -- 1:10 a.m. it the biggest drop in 30 years. currencies are not supposed to act like this. that raises a lot of questions of do we have liquidity in the currency markets. olivia: we have a lot of dollar strength off of the back of this. nasa the stories making headlines at this hour. the u.s. budget deficit will be

lower than previously forecast begins octobert 1 brady the shortfall will shrink to $426 billion this year , down to 14 -- $440 billion. situation will get worse by 2018 because of more entitlement spending. olivia: new home sales rebounded in the month of july. that is the biggest gain this year. it comes after new home sales now almost percent in june. is expectedew homes to keep growing because of stronger employment, low mortgage rates are at a lack of homes that are available. alix: on prices in 20 u.s. cities rose in june, and ashley prices rose 4.5%. a limited number of available properties help to prop up prices. susan. our professor,

>> this has been a rebounding markets on the price site for a number of years. this sales and construction starts have been up for the last two months. this is start, sales, and prices are on pace to increase, adding to the recovery. housing is a bright spot. alix: all 20 cities showed a near over your game, led by 10.2% increase in denver. i want my apartment to be worth more in five years. in ferguson, missouri are withdrawing thousands of arrest warrants for minor traffic offenses. they're looking to restore confidence in the court system. ferguson has been torn apart by racial unrest the killing of an unarmed black teen by a white police officer. on that high-speed

youtube video of islamic preaching that urged violent acts just before carrying out the attack. authorities are opening at a judicial investigation into the terror related act. olivia: the national rifle association and other gun rights groups are suing apple, the city of seattle, over an attack earlier this month. the council voted to impose a tax on each firearm purchase in the city. there will be to send tax on each round of ammunition. cl says it will defend that in court. still to come in the next half hour of the bloomberg market day, much more. eight weeksis in war. how his tirade is helping at hurting the republican party. we will dig into the stockle movement of the

of netflix. all of that and much more coming up. alix: u.s. stocks are rallying after posting this is today drop since the financial crisis. chris is a partner and head of technical analysis over at strategic research partners, and he gives us his take on the market. >> we think is a little early to call all clear just yet. the good news is that it is very oversold. everything yesterday was climactic in nature. volatility, deborah stocks making the lows, number of stocks making averages. that means that the bar is a lot higher. of internalee a lot

improvement going forward. today's rally, not impressed with it internally, advancing stocks only recently chronic sites by about four to one. i need to let better rescues. what are the chances that we are going to see a v-shaped recovery? the snap back that mirrors the decline? >> a more appropriate playbook is what we saw in 2011. we had the primary low in the correction in august, and it took two months to three months before we undercut that low in october. for set a better stage the rally at the end of the year. the seasonal wind is still in play here, we should proceed with caution over the next several weeks. the 50,charting against 100, and 200 day moving average . alix: where are we in that cycle? >> the takeaway, would be about

, when we are waiting for is the whimper. we need the undercut the retest or the time over there after the damage that we have seen. remember that the moving averages right now, the 50 and the 200 on the s&p 500 chart are starting to flatten and rollover. the trend is starting to change here, and as a consequence of that, the threshold on a rally has to be a lot higher than it was two years ago. olivia: i'm chart here that says we need to get more negative. how do you measure sentiment? >> when we look at the survey data, one thing that has not been capitulated yet is the survey work. the chart week on a busy survey from consensus thing just incorporated would give us a good signal into thousand 10 and 2011. we do not have it yet. i would like to see attitudes and has let's get more dire. alix: can we talk about the fix for one second -- vix for one

second? at mecklenburg terminal. we have a new enormous spike up, we're just over 30 on the vix. that was a huge spike we saw over the last few days. looksmax and out, it rather puny. well below the levels we saw in 2009 and 2011 eight what are you expecting? us what istells happening at what will happen. the move in the vix of the last -- the last three days, the largest rate of change over the last few years ever. to restrain short-term bounce. i do not think it tells us a lot about what we can expect me on that bridge when volatility stores to go, it tends to stay elevated for a time. i would not be surprised if they they raise longer -- stayed higher longer. can you compare what

happened this week to what happened in 2011? why does volatility spike in august of 2015? there is no single thing we can point to for the giant change in sentiment this week. whether it is china, where weather is russia, or oil, you can go down a list but with the bigger takeaway is with respect to the volatility is when you look at the 2011 correction, it is a bang and then it is a whimper. it is an initial public volatility and then you get the lower levels of market would have much less drama, with much less climactic selling. i think that is what we are setting up or as we move into september and october. alix: volume for the dow up by 41%. this day average or's voestalpine else. olivia: still to come, much more

including donald trump and a tweet war. how his tirade is hurting and helping, possibly, the republican party. ♪

olivia: welcome back. alix: we want to go straight to julie hyman with a look at the markets. is it is a busy day, but it will somewhat utter because of what has preceded. rally across the board, although it has abated as we head into the afternoon. we saw it go lower about an hour and a half ago. but since things things remained relatively stable. as 2.9%. as much we have cut that advance in

about half. this rally remains a fairly consistent set across the board. best time.movers is it is the largest gain in the s&p 500 about 15% written biggest one-day gain in about three years time. the company came out with earnings. generally we are seeing a reflective bounceback. there are some stocks that are moving on more fundamental news this is an example of it. the turnaround of the company has been cutting costs, but no revenue growth is appearing. of thes a combination reflective bounceback and --damental news to cells and had been sold, we are saying it is worth coming in to me look after the drop we have seen.

apple is down from its highs of the year. he can see here it is up 22% -- it dropped 22% through yesterday's clothes. it now it is snap it back from that. we're looking at the thanks snapping back to, and we have some analyst commentary on them. we heard from mike earlier today after he said that jpmorgan was the lebron james of baking. it has good offense and defense. here, the general commentary, whether you were talking about apple other banks that it is worth coming in after the big declines we have seen. they declined, it is not all roses today. we're seeing more of the next actor than we were on the downside to their was more uniform selling that it was buying. here are a couple of examples of stocks that are down. these are after utilities companies, after the washington

dc public utility commission said it was not going to approve .he acquisition we have had several states of proven, but it looks like it may be a spoiler in this case. alix: thank you. olivia: now to this top stories crossing the terminal at this hour. you are looking at pictures from islamic state social media sites showing destruction of an ancient temple. showed this 150 miles north of damascus. alix: unbelievable photos. pittsburgh carnegie mellon university, the company will provide university research and recruited areas such as robotics and artificial intelligence.

it is the second-largest provider of i.t. services. olivia: fourth ranking senate democrats said she will back nuclear accord with the run. batteries president obama within five votes of the total needed to keep congress from blocking the agreement. she said she had frank conversations with mr. obama and joe biden and secretary of state john kerry. not a perfectis deal, and there are several elements i would like to be stronger. those are your top stories at this hour. presidential candidate donald trump is added to get. it appears it is trump versus fox news, trump versus anyone who disagrees with him. alix: is his constant haranguing actually benefit other candidate i trying out their own floats -- flubs? what is the latest today? whoast night megyn kelly,

asked him talk questions of the presidential debate returned from a vacation, and mr. trump took to his twitter account and went after her ready hard. he retreated tweets from others are used language many surprised he retreated. and fox news has come back at donald trump, who is come back hard at fox. contrary to some people's impressions that both sides would bury the hatchet after their first go-round, they are at it again. interval republican candidate would not there pick a fight with fox news because so many republican voters tune into the channel, but mr. trump feels like it is apparently no problem. olivia: that is what i am wondering. is this wise for republican candidate? crucial to get their support? >> in place by different rules. he is not subject to the normal

physics of donation politics. the spots will continue to cover him, they will looking for their shows, at in the laws of supply and demand, he has something fox once, and he feels that will give him what he needs from fox. every day we only talk about trump. does this turn the spotlight off the other presidential candidates, that they do not get their own vetting process? >> have some pretty serious candidate of their who are making the mistakes day-to-day that are not nearly getting the attention they would get if donald trump were not in the race and were not dominating the media coverage. that is a mixed blessing. we will discuss this on all due respect. it is an interesting dynamic. candidate,a major

scott walker made it pretty been mistake on friday, but that was the day he was speaking in alabama to thousands of people. walker skated through. long-term it may not be good for him. we have been making a big deal about how it seems that jeb bush is starting to talk tough. he is, swinging and recent comments from new hampshire. do you think that donald trump is putting the right kind of fire underneath him? >> the bush people feel they have no choice but to do it anyway that will be an official -- beneficial. be biggest problem will not donald trump, but can he reinjured his himself to the country is something besides the third was, and they were successful governor of florida. not just attacks on trump, not just offenses against tromso tax, but flushing out the bush

position on things like immigration. that is why you will see over the next few weeks as he unveils things like a deficit reduction plan, a plan on taxes, a plan on growing the economy, that he will use the opportunity to engage trump and to suit his own purposes. just as you were giving us that explanation we were showing a video of him being asked to sign a picture of himself with his brother. a nice visual there for the dilemma. into with alle due respect at 5:00 p.m.. and they will be speaking to presidential chill -- residential candidate donald trump tomorrow. netflix may be bouncing back today well into the green, but we will uncover some surprising fact that may put investors on edge. ♪

pastor ron a netflix binge

and purge. why has it become the poster child of the fab five? cory johnson joins us now from san francisco with more. you said binge and purge is like my life. i netflix? alix: it is all about me and for three or day four hours. cory: i just wanted to check. alix: moving on. cory: i think that netflix is the most illustrative stock of the last 15 months. what you have seen in the markets in the last few days, and in the last year is all about links, and how netflix

empathize all those trends. it was the biggest decline are on the s&p 500, and it is now rebounding today as it is doing with the rest, twice as much. cough,market catches a netflix catches a fever. we have seen that over the year and over the last few days it reflects the characteristics of what momentum traders really like about today's stock market. olivia: do we know anything about the nature of the investor face of netflix? is this more actual individual know thatdo we netflix in particular is held by a lot of all the rhythmic electric -- algorithmic electronic funds? cory: casual consumers who use of love the service find something they think is an

appropriate investment vehicle. concept and they teach their business model to emphasize growth and to emphasize topline growth rather than turning a profit and getting free cash flow. they want to be like amazon, and not berkshire hathaway. what they did is increase their expenditure on content, you saw them tilting up new shows. they have had some dramatic failures as well. with the increase in marketing spent on topline growth is no profit. alix: thank you. olivia is sadly leaving made. -- me. ♪

♪ ♪ ♪ 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. to theelcome back bloomberg market day. let's get to a look at the top headlines this afternoon. americans are growing more optimistic about the economy.

the conference board's consumer confidence index came in higher than expected. a larger household income or most confident, and those under 35 or more confident than those over 35. the world's biggest electronics chain sold more tvs, phone, and major appliances than expected. they said they would dedicate more space to apple products. here is the conference call. by there very excited early momentum of apple watch in , and we have an accelerated and expanded rollout. bex: the apple watch will offered until best buy locations by the end of september. john mack has a new mission, he is trying to persuade

general electric to move its headquarters from connecticut to new york. he is a former advisor to the new york governor did andrew cuomo. they said they might move because of a state tax law change. fromwitter is shifting measuring the effectiveness, which is raising eyebrows. twitter told the sec it would track was on to as, and that answer satisfied regulators. i do not set your watch by men. the 156-year-old clock chimes it's 15 minutes, and if deep chimes to mark the hour. but now the famous clock at parliament has recently been slow by as much as six seconds. reirs are in the works.

those of the stories making news this hour. more signs of progress in the housing market. oaccording to the case schiller index they rose by 20% in june. earlier on market makers, erik schatzker spoke with robert shiller and morgan stanley investment advisor about the prospects of a u.s. recession and the role housing might play in causing one. >> i have not been predicting a recession in 2016. i would not be surprised if there was one, but i doubt the good be strongly connected with the housing sector at this time. pope francis have been going up and it is a better market for building houses. if there is another recession it would probably come from consumer confidence liking, from . general loss of confidence i

data tells us things about human behavior, which is your specialty. decisions faced with a on september the 17th whether to raise interest rates or not. evidence tonough justify a rate increase ? > next month? >> that will be on their mind when they make the decision. if it does look like they did yesterday it would postpone it, and i would do the same. now thanking better just this morning. it is hard to predict what they will do in a couple of weeks time. >> why should the market be important to the side? tell the fedt policymakers about the state of mind about the actor? worrying about

the state of mind of the economic actor with the market turmoil we have seen. as you know, big stockmarket move as have been connected in the past two major recessions. the fed has to take account of the psychological principle. we could see more aftershocks from what we have just seen over the past 10 days. those aftershocks can shake confidence, and they can get people into a panic mode. at that point it would be emergency time if it happens. the fed would have to take action and keep rates as low as possible. >> the professor is right, and the films being attention, they would never raise interest rates, because every time that you were on thverge of looking like money supply is going to be tighter, the market is going to act in a way that will never raise rates. that is crazy. you really believe, progressive, that janet yellen is watching

the stock market tick by tic to make a determination on this relevant fed move? >> i am not a next bird janet yellen's inner thinking. but i cannot imagine that any fed chairman would not be concerned by the action we saw in the stock market in recent days. it was a wrenching experience. it is the kind of thing, that even if it is not on their agenda or their philosophy, a realistic person would take note of that. this was quite an event that we saw in the stock market over the recent days. alix: that was robert shiller and gary kaminsky speaking with erik schatzker. at theto take a look markets right now because we are seeing a significant deterioration into the close. if you take a look at the s&p, it is now well-off of the highs of the session and now of only by nine points.

trading very closely to the neutral territory. joining me to discuss is my coanchor joe weisenthal. i am's growing lutheran -- scrolling through the headlines trying to figure out what .appened around 1:30 p.m. joe: it is a really pathetic market. we came in this morning with high expectations, and at one point it looks like we would recoup all of yesterday's losses. but after the early morning and has just been soggy and really ugly. say: some traders might this is a dead cat bounce. joe: it is not surprising that michael regan had a thing today which is when you have some of , theseig flash events dramatic moves, it is not uncommon for the market to revisit those loans that at the time seemed sort of crazy, but you end up traveling back down

there. alix: let's talk about the vix for a second. it hit over 55 trading yesterday, and now we have have to that the volume is so extreme . joe: what is even crazier if he you look at the volatility of the volatility. it is at its highest level ever because there is so much uncertainty. at one point yesterday morning there were issues with people getting pricey on it. it shows a level that people have seen in recent days. olivia: when you look at what sectors are selling off, it is the risk your sectors that are doing better. energy still in positive territory despite oil losing some steam. you would associate that with the fed hike rates. what changed over the last few days? >> it is surprising but perhaps also encouraging.

will in terms of what we see over the next few days, it is hard to find the catalyst vicewe will see the fed chair speaking, and we will be parsing those words. but are we going to get any clarity about them? joe: they came out saying that tension of bristol on the table. they said the big wildcard will be can vice chair fisher talk about inflation, or that the commodities ruin headlines, deflation will leak into it. in terms of catalyst we will continue to watch china for the rest of the way, what happens with the market, will it help to .tabilize things alix: we do want to get more on the markets and julie hyman is looking in depth of what is happening before the closing bell. julie: take a look at the s&p 500 on the day.

we are now very little changed here. you have the intraday chart of the s&p up less than a point right now. we mike turner negative on the day, even as we are watching it right now. it looks like that could happen. so really there has been a rallyic stage of this over the last half hour or so. it has been accelerating over the past few moments rate really fascinated action that we have seen because of going into the season to an session today said that perhaps indeed we were due for some kind of bounce. but once this correction had happened, and it looks like we negative,-- touch the a very small dip into the negative. essentially, .01%. it now we can see it on this chart traded down a 10th of 1%

right now. there have been warning signs whole thing.e this is the percentage of stocks advancing overall in the stock market today, divided by those that are declining. you can see the number right now is about 1.2. when i attempted an hour ago it was about 2.7, 2.8. contrast that yesterday when there were working .5 stocks advancing for every one. hasbreadth of the valley been much narrower. i also want to take a look at the imap on my louvered terminal to take a look at some of the sector movements that we are seeing here. free, utilities, they were suffering. and now we committees and

utilities are down now. -- they're are only two groups of the s&p that are higher. consumer discretionary and information technology. it has been a fascinating day here. alex we were joking about how quieters going to be and we could grab lunch. but now we will see what happens . the s&p is holding onto a very small game, but only a few moments left in the session it is unclear that it will stay that way. long new ones to be overnight with anything that could happen? do you do whenat you are a traitor and you see stock deteriorate and you are ins?le to hold those ga it is very discouraging.

he say there's a balance, and they go back to the level since yesterday. whatsically tells you that we i today was a searing event. the recently cannot get any readout is not particularly encouraging. alix: it's not just stocks that are selling off some it is also the dollar. the dollar index is lower by about 1%. typically the dollar has been is a haven, and this is often the case. it has been the euro and the yen. joe: this is the big story. in the past, you expect to see the dollar strengthened. on our show yesterday we had howe court -- point in the that new correlation, that down

on disk risk -- risk off is in. alix: gold is still down by about $13 on the day, while off the lows of the session as we have seen the way in the thing with commodities, julie hyman is going to that oil. julie: as you talk about the correlation between the dollar and talks, we are not seeing across the other asset classes rate if you look at oil intraday, which i have up on bloomberg terminal, it is no higher on the day. we a little bit of volatility here. but we have not seen anything nearly as dramatic as we have been stocks. it is interesting that is seen to be limited to stocks, even though over the left past several days we have seen cross asset volatility. perhaps seeing some movement in the dollar as well. if you look at the dollar index for example, it is taking something of a leg lower to not seeing it.

closed at this point, but not be saying much of a move in oil or the other commodities. you are seeing it was sharply in the dollar. if you take a look inside my bloomberg terminal, you are looking at the bloomberg commodity index versus the s&p on a normalized basis. it has heldhow up despite stocks and commodities deteriorating. that is a big difference that -- big difference. joe: historically you are right. who knows, if they were to me by the pa pretty ugly situation and they will inevitably mean it does seem like something is rogan. but there is a huge gap working for them. alix: one to is where people are

buying no surprise is the treasury market. it is still about 6%. as we've seen stocks deteriorate have seen a little bit they did in the overall treasury market. sensitiveup the more one to any kind of shift in expectation for when we ha seene fed hike rates. joe: we have seen a dramatic decline in the expectations of the september rate hike. or even if you just: economist. we have the fed chair stanley fischer who was on a panel on latter-day -- on saturday. jackson hole is the question now. tons of people will be there saturday, paying attention to the speech.

alix: this morning it did not seem like we're going to have any selloff today. goldman sachs say the s&p is down about 11% from its high, and on average, it takes about six the eighth days to reverse from inspired. their implication is that it will crack i saw a lot of research along the line. saying goldman sachs has held its line long enough. there was a note from ages vc looking at the entire world. the stock market saying it looks like the stock market has run its course. werefew of the strategist sliding off. alix: one of the stocks that are leading the way? the percentage of

new york stock exchange stocks that are closing above the 200 day moving average. this is not calculated to days, but as of yesterday that number was pretty paltry at around 17%. look at how steep that the client has been at how much we have deteriorated just the past year alone you cannot he held up by 17. that are above a certain technical level. he just shows you, management of has slammed margaret some of them have had their portfolio damaged by this upward trend. alix: still up on the day 505, but we are looking at it to your rating is going to neutral. joe, you will be back in 13 minutes to help me, the close we do have much more for you on the markets. julie, what are you looking at?

40 sixif we fall straight day, that will be the first time that has happened in july of 2012. we do not know here whatever --the nasdaq: don't again, but has been a former throw the session. as a look at my s&p 500 seeing 381 declines now, to 121 games. the brand has just turned on its head. microsoft, ge, johnson & johnson, they have the heaviest weight on the has -- on the this is an

interesting reversal and when i cannot see for -- say i have seen in a long time. joining me now for more bloomberg, lisa abramowicz. my, was there a catalyst to the e analyst -- to this? joe: the progress that we saw yesterday, people come in and cover their shorts. money come in, but that is not likely to economy to reassess the lows that they saw. when it hits a loan like that, they almost always expected to come back and retest that low. maybe a slower pace in a few

days. not dramatic plunge down and we saw. really no news to account for this. it was just clear that the enthusiasm for this rally kind of faded. alix: when you treasury market, there are data specialist in the short-term treasuries. --any of this related to the >> the implied volatility searched to its highest since february. that is interesting to me. the other thing that is interesting is you see this basicallyng on, and what you are seeing people are expecting a rocky road ahead.

riskier assets at a time of intentionally limited liquidity, you are seeing a bond trading volume below average but below where they were last year. people are not going to go there. alix: talking about the asset classes, take a look at this bloomberg commodity index which is off by about 38%, and also enter barnett high your credit spreads. that has widened by about 30%. activity has been holding up. not know how closely you need this index is to mirror each other. as lisa will tell you, the credit is a leading indicator for stocks for many reasons.

but the issue commandment of the sick and explain this better, the thing i do not get about this is that so much of the high-yield credit problems are energy-related. oilously, the huge drop in has caused a lot of companies to load up on this during the boom time. so from a systemic market thing i am not sure, is that is big of a deal as cutting conditions in the financial crisis that centered on more actual banks. i do not know at what point it's spreads. people looking at that. a lot was selling is been concentrated in the energy debt. i took a look at action yesterday. the lot of the selling is coming from the energy sector, that said, you are seeing a little bit more we just to see that

things are a little bit more cautions with their lending. we are starting to to see some problems in the privately placed .he market we are seeing business development companies where the shares are selling off in a massive way. they are not raising money quickly. that funding goes to smaller companies. there are signs, and there was in some tightening of credit conditions. about, butconcerned to what extent i do not know. is all like we experiencing .nother 2007, by any means t julie, which ones have been leaving the s&p 500 to the downside. julie: the momentum stocks we have been talking so much about. i am running the function which

tells you which stocks you can gain and fall the most and which .ould have the most influence microsoft, fargo, verizon, johnson & johnson, they --e to be facebook, gilead, disney, which has been really beat up recently, it has a little bit of a strange reversal. the other is just purely percentage. you see some of the same direction. best buy and netflix, as alex pointed out, they're are still gaming. some of the top 10 are the same. it is perplexing, or unusual

that you would not seem easier momentum stocks lead on the declining -- in terms of the declining weight on the s&p. alix: the overall sector, it is the same story. they are all lost 2.5%. that is where you think you want to go, and then there is a panic what does that mean to you? just for day-to-day basis, it is clearly, if you look at all the industry groups throughout this, there has not been in of dispersion between the declines. leader, i look to the group's leading from about 250, which was when the artwork started to roll over. not much more than the other group. onemarket as growing at he's at this time. everybody solves one thing at there not a lot going

on between sectors. that is true then he drank and i can play maddock moves in the dramatic and climactic moments in the market. >> the high-yield market as well as junk-bond etf. >> my chart is a big question mark right now. you just got your head when you have no idea. alix: thank you probably make it to the close -- for helping me get to the close. we are following this market deterioration into the close. much more on what you miss.

.

alix: we are moments away from the closing bell.

unbelievable day. u.s. stocks erasing gains. joe: the question is, what'd you miss? another wild ride, stocks surge after friday's slaughter. they dive at the end. when will things cool down? alix: plus which countries have lost the most money. we have the charts. joe: and the china factor. is all of the panic real or imagined? alix: we begin with markets. s&p down 1%. this is the longest losing streak since 2012. the longest in three years. you're looking at five days selloff for the dow.