from bloomberg world headquarters, good morning. here is what we're watching this hour. the latest on when the fed may raise interest rates. we've already heard from dennis lockhart the biggest weekly gain since august. why they say the worst in the collapse is over. and trying to fold coldwater on the 100 million offer from bud. we are 90 minutes into the trading session riddles go to our markets desk. julie is watching the indexes. julie: they are holding on to the gains.

the fact is about double of the other major averages as the s&p 500 is on track for its best week in nearly a year here. intangible commodities. extent changing to some today. take a look at my terminal. we have seen a consistent trade where health care has been down and energy has been up. that flipped today. health care is one of the best-performing groups. energy is now down. topstrial's are now the we have been watching the biotech roller coaster. it is not seem to be news low pushing and pulling it around. right now we are seeing is

higher. even though oil is higher it took a hit lower. right now oil is up five and more percent. betty: when was the last time we zink?d about sin >julie: having his best game since 1989 in a single session. like so many other commodities it has been battered this year. way that leave the leads the way in commodities. we have more from artist desk. >> we start with the university shooting in arizona.

when the fight was over, one person was dead. student groups got into a confrontation, the constitution turned physical, and one of our students, stephen jones, 18 years old produced a handgun and he shot cointreau for other students. one of our students is deceased. the other three are being treated at the medical center. >> the shooting took place outside of the door. president obama is likely to get a mixed reception when he needs survivors of those killed in last week's shooting. not everyone is happy with his sit. gun rights supporters plan to protest. the recession is on the way. when? this comes from the carlyle group cofounder. he was a guest on bloomberg ago today. >> we have a recession every seven years or less.

so at some point in the next year or two you can expect a recession. i do not think we are here now, i do not think there's any indication of it but you do expect some slow down. i do not think we are to grow in more than 2% in the united states this year. the u.s. would only have waters rose for a wild. the obama administration is ended their program to train syrian rebels. they cannot produce enough ground forces to take on islamic state. last month only for five of the u.s. trained rebels were still fighting. the tunisian national love the first of the arab spring movement four years ago.

dennis look at our news. betty: thank you. they were more worried, indicating liftoff was unlikely. lockhart today said that he feels the fed should lift rates this year. the company economy remains on a satisfactory track. speak for myself, i see a liftoff decision later this year at the october war december fomc meetings is likely appropriate. reaction, i want to bring in our economic editor michael mckee. also joining us from boston is our chief u.s. economist.

what is going to change in the next figures? >> we have a lot of data. the question is does the data show us a problem with the dollar were inflation? inflation is going to get a little bit better because while prices will be going back up again. price of lastil november and december you see a little bit more inflation, and a little bit less of the effect that we have seen. this is all short-term. october's off the table. december still a very life possibility. president williams yesterday they want to raise rates. offy: they want to get zero. what struck you about this? >> what struck me about his

comments is that he tried to keep october in place. that hashis is a fed market expectations that are shifting that left off -- liftoff and now this dovish fed has to talk tough to keep the expectations back in 2015. faster inflation rather than lower inflation. it is not symmetric and they have a law of the tools at their disposal to slow the economy or rein in inflation.

they can raise rates, they can raise rates faster, but on the other hand, if they are looking to add additional stimulus you do not have a lot of policy tools available. they ruled out negative break earlier this court. rates earlier this morning. the possibility of delaying rate increases or revisiting quantitative easing. --y have a very a semester asymmetric response. athink they still have balance of risks around the economic and inflation outlook. balance, soy nearly they're not there yet. you, what about partly sick out to you? >> -- really stuck out to you? they are in the review here those, and they are looking

further forward ahead. it is not about when we liftoff, it is about how far and fast we go. janet yellen has a just did that maybe they want to run as an economy that is a little bit hotter and let inflation go a little higher. a number of participants noted that eliminating slack along streams.ader they would worry about inflation taking off, but with it so low, it looks like she has some board or this. it will be interesting to see if it means even lower for longer. someone who wants the fed

not to do anything to delay any liftoff is going to have that stands. andas on bloomberg ago, this is what he had to say about the economy. america'st is recovery is anemic. if you look he owned the five point whatever percent unemployment rate of the true unemployment rate, people working hartline just part-time come is well over 12%. reflected in the wage since -- wage stagnation that we have seen. that was joseph. on inf meeting is going peru. does he have anyone listening? >> i think janet yellen is on the same page, talking about lingering labor. i think most of the core of the committee is still standing

behind that view as well. was theyork president one who was talking about letting the economy run hot and i think he is going to reiterate these things. there is no rush to liftoff. one concern i have is that the the postd about liftoff trajectory. imported you cannot ignore the significance of the first move. you always want to find out the checkpoints. what are the checkpoints to december? the jobs report? we know that the foreign part of the economy trade has not been doing well. inventories have been too high. what fed officials are focused on right now are the domestic economy. we will watch the cpi report as they go forward. obviously, in november jobs report is going to be very keen.

we do not have to go back over 200,000, but we need to keep seeing progress that would be a good thing for those who want to raise rates. if we saw the implement rate declined a little bit more, or , if thent job progress snow continued to decline the can keen to check that box and it keeps december on the table . >> the atlanta fed president watching the he is consumer data between now and the december meeting. i think the consumer data, it is important to the economy right now. i think the jobs numbers are really the most important determinant. i disagree with like a little bit here. if we slip below 2000 i think they are going to err on the side of caution. betty: what if the markets tank?

>> of course we need financial stability. we do not want any negative impulses affecting the economy. that is one of the reasons i think potentially, the risk is that it pulls has not fully percolated into the economy and the october numbers could be even worse. the markets are not going to tank, they may go down over there not going to take a less something happens. you really bad job that is the reason they like. betty: have painted themselves into a corner? the whole idea of being data dependent. everyone is so fixated on with the numbers say that it is hard with them to coexist that even if they feel it is the right thing to do. >> i would are they have not painted themselves into a corner because data is weak.

betty: we will continue this. thank you. much more ahead in the next 20 minutes of the bloomberg market day. we will tell you why packaged have been aes that good investment now need to pick themselves. -- protect themselves. and apple pay is coming to starbucks and macao see, chilies. we will look at how they are trying to boost their noble -- mobile payment system. ♪

betty: good morning and welcome back to the bloomberg orchid day. it is now time for a business flash. walmart's retiring at the end of the year and passing the baton to breath big. he currently serves as cfo of the international unit. and speaking of cfos, this brand-new cfos says that the wireless carrier is bloated. he wants to cut operating costs by 10% to save $2 billion. he will also reduce equipment spending by as much as $9 million. is upexas intermediate

10% this week, trading under $50 a barrel. there's speculation that increased demand will ease a worldwide glut. then you can always get more business news at bloomberg.com. let's go back to our markets desk where julie hyman has a check on company movers. alcoa, taking off the earnings season. estimatesd analyst and we saw the price of a limited full it for a fourth straight quarter. michael kors as well today, sales trends decelerating throw the month of september. betty: thank you. still ahead, investors have traditionally flocked to packaged food companies like general mills in times of turmoil, but that safety net may now be gone we explore that with bloomberg radio. ♪

betty: let's get another check and how the markets are trading right now. let's go to cory johnson and carol massar. >> we're going to talk about packaged food companies. we welcome all of our companies viewers on bloomberg television. we went to the package food specifically because they have been a safe haven. we are here with our restaurant food analyst. typically it is a place where investors go weather is a lot of volatility in the markets. forhat has been the case decades. it has attracted investors in times of market distress and volatility, yes. >> what are we seeing now? >> that could change.

valuations are as high as they have ever been in packaged foods ratiosht now the ebita are 4% higher than the 10% your average. m&a has driven a lot of hot money into the second and driven valuation multiples of. -- up. ing on theiro invest own to the struggling growth in u.s. supermarkets. >> what you're are saying it was all the m&a that we have been seeing. they will be potentially acquired method at the same time you talk about growth in emerging markets. the rise of the dollar is not going to help these companies selling packaged goods, we do not have supertight mortgage -- margins. >> is a grade point.

it has been a big headwind for these companies. the more that they spend overseas, the more of a risk it becomes. -- it could be more u.s. centered companies. foods, exposed mainly to the u.s. mainland and europe. multinational the players. >> we have seen a lot of pressure to consolidate them into doing deal in this space and improve their specific and -- business environments. >> the problem is sales are growing so slow here in the u.s. there has a lot of pressure to invest in some of these organic food companies. are we seeing better metrics

in terms of margins? >> they are a little bit lower because it is harder to source the organic and non-gm foods. these companies are growing center of the store brands are flat to down. 20 of those companies that are rewarded for working so hard . that is going to turn around and bite them. radio that is bloomberg speaking about food companies. we are breaking in with breaking news on credit squeeze. reporting the ceo of the company is considering selling

options. there is a range here. seeing the shares move lower in u.s. trading because of this. if you tend to sell stock that eludes -- down to the value. that presentation is scheduled for october 21st. the company has not made a final decision on the amount that might be raised. pressure tois under raise capital. we could see the share sale coming from credit squeeze some time later this month. betty: we will be watching much more ahead is a have been trying to restructure and revamp this bank amid recent turmoil. thank you, julie.

still ahead on the bloomberg market day the battle of the beer giants keeps on. what they are doing to rally shareholders against $100 billion takeover offer from the maker of budweiser. much more on this big m&a deal the beer sector. ♪

betty: live from bloomberg world headquarters, you are watching the "bloomberg market day." let's start with the first word news. we start with president

obama and russian president vladimir putin. president obama says russia's military action in syria is n's hold on puti leadership eroding. mr. obama portrayed their decision to launch airstrikes syria as a desperate move. the obama administration has put an end to that training program for syrian rebels. a sign the program cannot produce enough ground forces to take on islamic state in syria. the pentagon says only four or five rebels were still fighting. , one college student was killed and three others wounded in an early morning shooting. it happened in northern arizona university when two groups of students got into a confrontation on campus. a freshman has been arrested. >> we awake this morning to a terrible tragedy on our flagstaff campus.

we are shocked and deeply saddened by the circumstances that bring us together this morning. vonnie: the shooting took place in a parking lot outside in northern arizona university dorm. a new sign joe biden may be inching closer to a white house run. staff briefed people representing biden this week. they will discuss the primary calendar, filing deadlines. the last thing people in south carolina want or need. a week after a storm brought historic flooding, more rain is on the way. the rain will start tonight in some parts of south carolina getting up to an inch. that is a look at our first word is pretty can always find the latest at bloomberg.com. betty: let's get back to one of the big stories dominating

washington today. who will be the next speaker of the house? is the republican leadership in disarray? joining us is a republican from ohio, which is also john boehner's home state. you just had the closed-door yourng with members of house -- what came out of it? did any conclusion come out of this meeting? >> no conclusions today. it is clear that there are a few people who can unite our conference and become speaker pretty easily. the person ong most people's lips this morning. he has the ability to bring us together. he has not decided that she originally said no and now be reconsidering this may be reconsidering. .- he originally said no

we talked about how important it is to come together for the future of our country. it will all work out, we just have to work through a process. betty: we are just getting a statement right now from paul ryan's office that says he is still not running for house speaker. >> i don't think he is running. anybody that would be running for the job right now may disqualify themselves. that doesn't mean he may not be able to be convinced. that is a developing story. betty: you think it is just semantics right now? >> i don't think he wants the job. he will need to be convinced that he is called do this job. i don't think he wants it, i don't think anybody in their right mind wants the job right now. it's an important job and we need somebody who can bring everyone together. there's a few people who can do that and paul is one of them. betty: how do you convince him?

>> a lot of people are talking to him. we will see how it goes. betty: given that is is the second piece of news here, your shockinghn boehner washington with that news that he is leaving. now, this from mccarthy. people say the republican party ing what a messor the party is and how they are being dominated and controlled by one faction of their party. >> our party is full of rugged individuals all throughout the party that feel different ways, either ideologically or on strategy. what really divides us is not even about ideology, it is about strategy and tactics. we are working to mend those divides to make sure that we build a vision and a focus and strategy that will move us all forward together. betty: there are others

interested in this job. -- jasonan j fits chaffetz and webster as well. why wouldn't they make good speakers? >> i just believe that neither of them can unite our conference. we need somebody who can bring everybody together. everybody can agree on. they each represent portions of our conference, but we need to but he can represent our entire conference. that should somebody who can represent our entire conference. betty: what will ryan be able to do differently? >> it is in all of us to make it work. the first thing we need to do is look in ourselves and say what can i do to make it work better. all 247 of us need to ask that country of ourselves -- that question of ourselves first. that will move us forward.

it's about how we can come together as individuals. there is no monolithic group. onjust need to come together enough stuff to say we agree on 80% of this. let's move forward with that 80%. noty: maybe paul ryan does want the job because he thinks the tea party has too much influence. don't know why he doesn't want the job. there are a few people who can unite us. he is one of them. i would like to see him take another serious look at it. there are things you don't want to do but things you need to do for the team. we all played team sports before. there are times when you have to throw, you don't get to carry the ball. need sometime when we you like paul ryan to carry the ball. there are others. betty: like who?

>> i think there's several people, like tom cole, patrick that couldke conaway do the same thing. they are not household names, they don't have established national fundraising. paul can help us on the campaign side, help us on the administration side and bring us together. he does a lot of things that the other people cannot do. that's why i believe he is the best choice. betty: is raising the debt ceiling in jeopardy here? >> i don't believe so. every time we have done things like raise the debt ceiling, it has been a group of republicans and democrats who come together to do the right thing and make things happen. we need to raise the debt ceiling but we need to maybe get a couple things done in

combination with that to make it a thing that is good for the country. nobody wants to default on our nation's debt. we need to continue to make structural changes and so we can continue to improve things overtime -- over time. we cannot stay on the same course. raising the national debt is about yesterday's bills. it's about things we have already agreed to spend money on. we do need to make sure we start spending less money and move towards spending less money. i voted for the debt ceiling. this time, as long as it is a reasonable package that moves us forward on reducing the debt. betty: thank you for joining us today. steve stivers of ohio. much more ahead. we take you straight to the nasdaq for a look at today's biggest movers come including the ipo making its trading debut

this morning. apple pay is looking to take a bite out of the mobile payment market. will the addition of new retailers like starbucks help things along. when will the fed raise rates? the million-dollar question. we continue today get into yesterday's meetings -- minutes. ♪

betty: welcome back to the "bloomberg market day." h.me for our business slas insurance companies will be taking a hit from those wildfires in northern california. $2 billion in

economic damages. state farm is the largest home insurer. credit suisse may sell stock to raise a billion dollars. -- $8 billion. under pressure by swiss regulators to raise capital to protect against another financial crisis. a plan to allocate more resources in asia. sabmiller doubling the amount of cost cuts and has planned. been urging shareholders to push forward to negotiate a deal. you can always get more business news at bloomberg.com. european markets just now closing for the day and for the week. for a look at today's action, want to head to london where mark barton is standing by.

mark: six days of gains for european stock markets, the best run since the end of july. investors bet the fed will not budge on u.s. interest rates this year after the release of that september minutes. 4 million euros added to the stoxx 600 in the last six days. -- 4 billion euros. 600 rose for the ninth day. that has not happened since y2k. 19% after the 29% slump. pimco says the worst may be over for commodities as producers scaled-back output. oil companies have enjoyed the best week in seven years. automakers have reason the most in almost four years.

a bit of data that stood out today came from the u.k.. construction output fell at its fastest pace since 2012. britain posted a larger than expected trade deficit in august, indicating a false -- could persuade the bank of england to keep interest rates lower for longer. how about a look at the big movers across europe today? sabmiller pledging to cut costs to combat the ab inbev takeover. -- bill winters is planning to cut almost a quarter of his staff to reverse a two-year profits like. -- profit slide. glencore, another 7% rally.

the glencore resurrection has been absolutely astonishing. last monday, shares fell to a 66.67 pence. how do you double your money in nine days? by glencore shares nine days ago. the company has convinced investors -- they will cut zinc production by a third. record high for zinc. have a good weekend. betty: an easy way to make some money if you time to write. it right. pimm: we are still trading. a bit off the highs of the session right now for the nasdaq. the nasdaq composite up about 10 points. earlier about initial

public offering for an electronic card and payment maker. they make cards for american express, bank of america. they priced their ipo last night, started trading this morning. they cut the amount of shares offered in the offering amount. they wanted to raise $300 million, and appraising $150 million. the stock is up 20%. the ipo looks to be pretty good. , looking atlines capacity and load factors, a record september for american airlines. the stock moves higher by 5%. increasing load factor by 7%. of energy input means more money for the airline. w beingover deal, uti

.cquired by dsb of denmark stock is up 45%. a lot of action on the nasdaq today. betty: thank you so much. pimm fox at the nasdaq market site. customers at starbucks and kfc will be able to pay for items with a few taps on apple pay. the service has not been posting stellar growth numbers. from chang joins us now san francisco with the details. i have not been following all the moves of apple pay. i was at a starbucks recently and thought they had apple pay. i was surprised they did not. finally done have this. emily: a starbucks has its own digital aspect doing pretty well. you can order your coffee ahead of time. it will be interesting to see

how important this is to starbucks and apple. earlier this week, we had not seen a lot of traction from apple pay. at the mobile conference, said apple pay will be rolling out in select starbucks stores by the end of next year. 7500 stores come also going to kfc. they are adding on more restaurants, bigger retailers. the question remains, just how much traction is apple pay getting? tim cook said 2015 would be the year of apple pay. you still have customers who don't understand it. they don't see it. you have retailers who say apple is not promoting it enough. betty: we want to see more traction here. i'm sure shareholders do as well. from apple to paying for a service, netflix.

for a lot of people, raising it by one dollar across the board is not going to turn anybody away. people are asking, what took them so long? emily: just 18 months ago, they raised it by one dollar. now, they are raising it by another dollar. a little part of me was like, i don't want to paid extra dollar. this pay the extra dollar. i want to see house of cards, i love narcos. netflix has enough confidence to raise the price. the original content has been a big part of that. content isal incredibly expensive and they need to fund that somehow. e, thehis price rais subscribers will not mind paying for this come we can give you more original content.

they are continuing to expand. investors had a positive response. betty: thank you so much. i binge watch netflix. , we take a look at the options affecting the markets right now as the s&p heads for the best week so far this year. ♪

betty: good morning and welcome back to the "bloomberg market day." let's get a look at the markets. julie: let's start with the overall market. stocks are capping off a pretty good week with another gaining day. for its500 on track best week that we have seen in about a year. continuing this rebound that's been going on.

what is the options market make of it? as we have had this rally here, what kind of hedging activity are you seeing in the options market? >> it's interesting that you asked that question. we are seeing quite a bit of hedging activity today. alcoa reported earnings yesterday kicking off the quarter. we have had a rally over the past two weeks. the market is unchanged today. inare seeing a bid volatility which tells me market participants are looking for protection today. regardless -- even that we have had this huge move higher, it seems like participants are looking for protection of these highs. julie: i know a lot of technicians were looking at the moving average -- we are remaining above it today.

are you seeing significant bets etf's?calls on the s&p much are not seeing too unusual overflow across indices. it's interesting where we are seeing the money flowing. this rally has seen a lot of inflows into defensive stocks, real estate -- financials showed a net outflow. areet participants expecting the market to head higher into the end of the year. julie: interesting. you mentioned alcoa. which traditionally kicks up the earnings season, the stock is down after getting hit by earnings. aluminum prices continue to be lower. this is not the end -- >> this stock was below eight dollars near the end of august. tosaw a huge move up only

report a dismal quarter. i saw a lot of institutional put buying happening. traders are expecting further downside in alcoa, $9.50 by december expiration. julie: what would you are trade be to benefit from that sentiment? >> i want to buy the exact same line of puts i'm seeing these institutional money flowing today. the december 10 strike put 450 three cents. they are treating a bit higher now. $.53. a couple months ago, this was below eight dollars. julie: an upside catalyst come of the company will be spinning off its aluminum producing business.

one would think that could potentially help the stock higher. would think that but we are seeing a lot of selling happening this morning. even after we had a huge move lower, players are still betting on a significant move to the downside through december. we are expecting aluminum prices to continue to slide. growth in china was a major concern for them. i don't think the positives will outpace the negatives they have going against them right now. julie: thank you so much. alcoa, down about 5% today following earnings that missed analyst estimates. ♪

>> welcome to the "bloomberg market day."

good afternoon. happy lunchtime clima. i am alix steel. scarlet: here is what we are watching this hour. hints of a rate increase. pimco says falling commodity prices are largely behind us. is the worst really over? we will ask the executive vice president who is making that call. scarlet: getting ready to show audiences his best steve jobs. already getting some oscar buzz. alix: for more on today's activity, we want to head to the markets desk where julie h