bloomberg's mark barton joining us as we wrap up the trading hour. certainly a bit more calm than last week. mark: yes, european stocks bounced back from their biggest low-end for years. but the markets are little changed. the european close starts right now. betty: we are going to take you from new york to london in the next hour. our markets are just hitting their lows of the session. mark: betty, you know i love my narrative, and this is spoiled binary -- this has spoiled my narrative. i'm not happy. there i was 20 minutes ago telling you how we have diverged from the age and markets.

let's put it in perspective, betty, even if we finish around these levels, we are coming up at 6.7% losses last week, the biggest in four years. somee are seeing fluttering of gains across the european markets. .emember the dax fell all those fell he most since august. the dax, as i said, the fifth worst performing stock .erformance in the world as i speak, betty, the dax turns lower. and the volatility index, it since 37%, the most april. it is not as good as it was earlier, but little changed. quite a difference to what happened last week. betty: it's interesting how your narrative changed in the last

half-hour. mark: i'm blaming you. betty: and i am blaming you, mark. ok, we had the south african rand, the president, jacob zuma, coming out, really complaining the market should not have move -- reacted to his move. when he got rid of two finance ministers in the space of two days. 2.3%.t that, up it is at a record low. mcquarrie bank says a combination of stocks and margin calls caused mass capitulation by japanese retail investors. mcquarrie says that they are forced to end their "romance" with the currency. this is the worst performing emerging markets currency this year. last year it was the word worst performing -- the third

worst-performing emerging markets currency. throw in rising interest rates, throw in an economy that is on tenterhooks right now, is what, you've got reasons for a slump in the rants to a record low today. -- a slump in the rand to a record low today. speaking of instability, let's talk crude oil prices. reaching the low of the session, down almost 4%. a lot of that volatility is -- crude traders. word on net longs in the wti crude traders, you can imagine, people are bailing out. courtney donohoe has more for us from the news desk. courtney? courtney: good morning. we start with el chapo. do not expect to see him in the

u.s. anytime soon. they have begun the process of extraditing him to the u.s., but it could take a year. hours after the arrest, actor sean penn revealed he secretly interviewed el chapo in northern mexico, which triggered questions about how mexico and dolby manhandled -- the manhunt. the supreme court will hear whether public unions can select fees from those who do not choose to become workers. union say they can require workers to pay for the cost of collective bargaining. the standoff at an oregon itslife refuge has entered second week. the mother of the group for leader is calling on supporters to send supplies. spoke toea's leader

those responsible for building what north korea is calling eight hydrogen bomb. he says that the bomb is meant to prevent a u.s.-led invasion. and david cameron was to clear the way for a national vote on whether to withdraw from the european union. to cut itsts the eu trade barriers and limit welfare payments to immigrants. global news 24 hours a day powered by 2400 journalists in 150 bureaus around the world. on courtney donohoe. betty? betty: courtney, thank you. china seems unable to catch one single break. composite pushing at 16. mark, the currencies, capital outflows, it only seems to be intensifying with each passing

day. to help make sense of china's meltdown, here is what he had to say. there is no real news. , the way reminds us that you structure market rules can increase or decrease volatility. in awe are seeing here, sense, is the consequence of market rules that were not as well-designed as they could be. mark: joining us, our chief investment officer -- are we better off withoutthe circuit breaker? a gravity that fell just short today. it will probably be down 7% today. i think anything that can move

liquidity -- mark: the reference rate had barely changed, and still we have the market selloff in china, 5% decline going on. the policymakers are communicating this in a clumsy way. i think the markets are drawing conclusions that are a bit pessimistic that. i do not think this is a hard landing the policymakers know about and they do not want us to know about, but i think the blur jumping to that conclusion getting the are not comedic edition they may get from the fed or the ecb. betty: if we chalk it up to there was a communications problem, nothing fundamentally wrong with china from economy, has the damage been done already, though? is there no way to take that back? it is similar to august.

the manufacturing data firms a little bit. , it is moving into more of a services economy. , they areod news is more than offsetting job losses in manufacturing, and those should promote future consumption, which is very important to engineers. i think china has a clear agenda. it's just being miscommunicated. slow isthere is a valuation of this year, but it will be managed. what we did see later ron, patrick, some policy responses. their rates and they wanted to keep that money in-house and stabilize.

you expect a similar policy response from china? guest: there will be a policy response. i'm not sure that they will use the same toolkit they used in the third and fourth quarter last year. i think there will be cuts, reserve requirements, fiscal stimulus if needed. what china is going to do is make sure it's headline growth is a different question. i think they will achieve that. i think they will give confidence to markets and more clues about what the agenda is. patrick, you are long on the european stock market, you have been shorting european food and beverage. how has 2016 been for you? guest: we are getting more wrong than we are getting right so far. probably a lot of people are. long europe, short u.s. is

something we are doing. europe is cheaper. we are long on industrials in europe. we're short on the consumer staples that are trading at 20 times earnings. there's so much slowdown. nestlé selling into emerging markets. consensus has profit margins expanding, but i think that will be a difficult environment if we have the big corrections and emerging markets that are pushing industrials down. havinge certainly are corrections and emerging markets currencies, aren't we? is this a broad brush come out of the producing currencies -- are they all the same now? guest: commodity producing china is very well positioned. i think that gives us a little

perspective about what china is doing at the same time. mark: and oil? oil may be set up for a bounce. it is so overwhelmingly negative right now. i would not be surprised if you get to $30 and you get a bit of a bounce. but you do have production not slowing it all. mark: patrick, good to see you. patrick armstrong. betty? betty: much more from both of us in the next half hour. -- the european close. the south african rand tumbling the most since 2000 eight, as mark mentioned. we are live in johannesburg with the latest. can oil prices hit a floor? we have the head of commodities at bank of america merrill lynch with his oil predictions for twice 16. ♪

mark: welcome back to "bloomberg from london and new york. this is "the european close." i'm mark barton in london with betty liu in new york. time for the bloomberg business flash. volkswagen's chief executive has .roposed fixes he has a meeting with the environmental protection agency on wednesday. he is trying to break an impasse over the suspected recall of almost 600,000 cars sold with software that allowed them to cheat on emissions tests. rose the mostfic in a year at london's heathrow.

the number of passengers was up 2% to just short of 75 million. the reason -- airlines are using bigger jets to get around these numbers on flights. gest mortgage lender in the u.k. is said to keep a restriction on cash bonuses. lloyds inking groups will not list the limits until the british government has sold all of its shares. they plan to divest the in cellg 9% stake lloyds shares to the public this year. and that's the latest business flash. he, let's focus on equities, u.s. stocks losing a bit of steam, yeah? we are influencing the trade in europe and you can blame -- not us, but crude oil prices. i want to head to the markets seeswhere julie hyman

lowering and oil. julie: take a look at this trend line. below $32 a barrel there. $31.78 is the price at the moment. this is thlowest since at least 2008. does not seem that there is any particular catalyst. the sentiment is overwhelmingly negative. forecasts are still above where it is right now. --e a look at my terminal this measure sentiment on oil. read is bearish, green is bullish, the middle portion is neutral -- red is bearish, green is a list, the middle portion is neutral. take a look at the s&p 500 intraday here. as betty mentioned, we have seen this correlation between oil and stock prices. stocks are taking a little bit of a leg up from the bottom, but

not as positive as things or earlier. one stock in particular i want freeport-mcmoran copper & gold, and just looking at the data, it gives 20% of its itdings not from oil, but has diversified. that has not been good for the company. the shares are down a shocking 18.5%. and finally, celgene, we got news that it has a new ceo, the president and chief operating officer. he is getting promoted. are down.e the shares the company also came out with a forecast for the full year that leaves room for it to miss analysts estimates. mark? mark: julie, let's stick with the health care industry, still ahead on bloomberg television. a company for up

$32 billion. details on the megamerger, just ahead. ♪

betty: you are watching, as you just saw there, the european close. i'm betty liu with mark barton. let's get to a huge pharma a deal, shire's acquisition of baxalta. look at the investor reaction. both companies negative, shire down 7%. the combination will make the companies a powerhouse of rare disease treatment. let's bring in drew armstrong. we indicated that this was going to happen, so tell us exactly how this got through. : this has been in talks for

months. i think back in the summer shire came out saying it had interest in acquiring baxalta, when it had been out for, i think 30 days? they had a time of cash. and the offer was raised by saw. 2 billion from what i cash is the main consideration here getting this thing done. betty: what does baxalta bring to shire? they, like shire, have gone after specialized treatments for diseases that affect small numbers of people. can be scientifically difficult. it's not like they're going some high cholesterol or common cancer. when you go after diseases that have a big- do not population of patients, you can command higher prices, it's a little easier to sustain as a

business model and is immune from the pricing pressures we have seen from the rest of the industry over the last year or two. betty: it seems to make sense for the companies. why are the shares down so much? drew: we may be entering back sayold order, when they they are going to spend on something, the stock does go down. that used to be the way it worked. it does not anymore in biotech. you say you will spend $50 billion, and everybody stock goes up. betty: maybe some rationality? drew: and we have been talking about this forever. it's not like this is shocking news and you will see the stock pop on that. we've known this is going to happen. we reported it, others have reported it. betty: another angle is the tax angle, right? drew: there will be a tax energy.

u.s. has the highest corporate tax rate in the world. 35%. the combined companies will pay about 16%. and when you talk about building up dollars in income every year, that makes a huge difference with the tax synergies to have a company overseas at a lower rate. betty: all right, thanks so much, drew armstrong, our bloomberg helped editor. mark, i know the european shares are about to close, but you are closely watching these out the african rand -- the south african rand. mark: what a story. amogelang mbatha joins us. what a plunge. what does it mean when it comes to policies for south africa's central-bank. does it mean that they will be more aggressive in their monetary policy thinking? amogelang: hi, mark.

thatitely coming through be moreet have -- as to aggressive. bank of america merrill lynch coming out saying they are expecting these south african reserve bank may have to hike rates as much as by 50 basis weeks and two -- in two time from now. that would definitely be a bigger move them may have made in recent years right now. definitely be rand's depreciation adding to some of the appreciation they will be facing two weeks from now when it makes its decision, mark. zuma and, amo, president made a bit of a pr offensive over the weekend, defending his actions, saying the rand or the market overreacted to the sacking of finance minister nene

. how has is your offensive gone down in south africa? mark, the analysts have come out criticizing that comment, his saying that the markets overreacted is showing that he does not really anderson and there is a trust level -- understand there is a trust level between lenders and governments and the sentiment is closely linked to what we are seeing with the rand. especially when we see record lows. analysts definitely seeing that there will need to be clear fiscal policy strategies so it or help stabilize the volatility we are seeing in the rand at the moment, mark. mark: great to see you on a day when the rand sank 9% intraday against the dollar. it is now down, betty, a mere 2%. only 2%, mark.

i know the markets are about to wrap up trading europe. how are we looking? littlee are looking changed, betty. we were up earlier on the stoxx 600. ofcould close in the region a 10th of 1% lower. not as bad as last week where sank 6%, 600 billion euros of value disappeared last week read we did not sink as ian stocks, have we? betty: you would have thought we would have straight on follow that move. what has followed that move -- oil prices. the lowest level since december 2003. much more on oil. ♪ the only way to get better is to challenge yourself,

and that's what we're doing at xfinity. we are challenging ourselves to improve every aspect of your experience. and this includes our commitment to being on time. every time. that's why if we're ever late for an appointment, we'll credit your account $20. it's our promise to you. we're doing everything we can to give you the best experience possible. because we should fit into your life. not the other way around. betty: welcome back to bloomberg markets. i'm betty liu. just finishing

their first trading day of the week. mark barton joined me this whole half-hour. end at thewe might low of the session. it doesn't look like that is where we are selling. mark: we were lower by 2.5%. we were up about 1% earlier. we have come down. by shanghai composite fell 5.2%. this is the worst performing global benchmark in 2015. the stoxx 600 last week sank by the biggest decline in over four and a half years. that puts it all into perspective. individually, the ftse down by .4%. we talked about this $32 billion deal. shire the big fall are today. er today. last week autos fell by 12%.

little change in the dax index. the fifth worst performer in the world. it sunk by 8.3%. that is a big improvement by last monday. week, the v stocks index rose by 37%. today, little change. we will close a little bit lower. it's a big change from last week. could we diverge from what happened in china overnight? betty: that's the big question. we know the south african rand did not. they have been affected by these worries about china. mark: look at that. the south african rand falling by 9%. the biggest decline since october 2008. a combination of stops and margin calls caused mass capitulation by japanese retail

investors. to be honest, this is a big decline in emerging market currency this year. it sunk last year because of political instability, because of lackluster economic growth, and rising u.s. interest rates. and of course, sinking commodity prices as well. prompt the weaker rand. it could prompt the south african central bank to be more aggressive when it meets later this month. heightt a 25 asus point when it meets later -- basis point tight when it meets later -- basis point height when it meets later. betty: incredible move. ist emerging-market rout facing some of the companies who do business overseas. i want to look at the nasdaq. we are on a losing streak.

the eighth straight session for the nasdaq in decline. this is the longest losing streak since january 2008 for the nasdaq. jpmorgan coming out with a report noting that it is earning season now in the united states. we are kicking off with alcoa after the close. jpmorgan sing the fourth quarter is going to be messy. we are looking for any kind of direction. let's check in with courtney donohoe. thetney: the trial of second baltimore police officer charged in the killing of freddie gray has been delayed. set to start today. it is now on hold until a state appeals court decides if officer william porter must testify against him. his case ended in a mistrial. freddie gray was killed by police. his death led to days of

protests. the democratic presidential candidates -- in iowa, bernie sanders has narrowed hillary clinton's lead. the iowa caucuses are just three weeks away. the same poll shows clinton cutting into sanders's advantage in new hampshire. -- said today that the "cruel sanctions against iran" will end soon and that the coming year will be one of socioeconomic revival. sanctions will be lifted once the nuclear deal takes effect. london's subway system is facing a series of crippling strikes. outsport workers will walk in a dispute over pay. planning a weeklong job action in a separate

dispute. i'm courtney donohoe. betty: thank you. one of today's big stories in europe and in the u.s. is that continuing plunge in oil and commodity prices. million have been wiped off the 61 company bloomberg world oil and gas index this year. lowest level in a decade. it is trading at its flows level since december 2003. mark: joining us now from new york is francisco blanch. good to see you. >> how are you? mark: one of your peers today said that a rapid appreciation of the dollar could see brent as low as $20 a barrel. is it true that the difference between $55 and $35 is primarily

the dollar when it comes to price action for brent crude? the don't think it's just dollar. there's a lot of things going on in crude. awould say that before we see turn in commodity prices and necessary condition -- not a sufficient condition, but a necessary condition is a turn in the dollar or at least a stabilization. weakeningn keeps on and the chinese market keeps on rolling over, commodities are not going to go through an easy time. a second condition is the eases off ai rout little bit. for the last month and a half we have been left with the impression that saudi will not accommodate at all any incremental iranian barrels that are about to hit the markets. and the iranians are not going to back off either.

we could end up with a big surplus of oil in the next couple months heading into refinery maintenance season. mark: are investors close to showin throwing in the towel? are we close to that point or not? >> we just put out a piece this morning entitled, can oil find the bottom? we make the case that there's a few things we need to see before that bottom forms. we have seen a couple of them. wti and brent coming close together. this means u.s. production is declining and domestic wide sweeps are becoming a tighter market. frankly,eed to see, some better news out of china. a weaker yuan and potentially government fiscal package could help do that over the next month or two. i also want to see a more stable

u.s. dollar. continued rallies doesn't help. we are starting to see the conditions for a bottom. but we are not there yet. demand andsee strong that may not come until the summer because the winter, unfortunately, has taken a huge amount of demand out of the oil market. betty: it has. as i'm watching the oil charts, let's bring them up. we are so close to breaching that $30 barrel level. remember, one of the things we have not seen yet is inventories reaching maximum storage capacity. downrice of oil has come in parallel across the forward structure. i think as we come down from here, the forward prices going to become more stable.

most of the pressure is going to come from the very front, which priceshe volatility of into the 20's is going to be a lot higher and ultimately i think we're going to find the floor somewhere in the mid to low 20's. at this point it's very much a ondi iranian price war going in my mind. it doesn't make a lot of economic sense. i guess politically there is very little common ground for those nations to come together and stabilize the price. and 2008 it, 2001, andalways opec that came in saved the market at the last minute. we may need to see a little bit of that. betty: exactly. we are not seeing that from opec. certainly a lot of what is happening does not make economic sense. it makes political sense for each of these countries. given that, is the commodities rout going to be dependent on

oil and where it bottoms out? talking about more than just oil. we are talking about copper prices. a variety of resources. isn't all predicated on where all predicatedit on where oil goes? is a very important component, but there are other things going on. we have seen copper mines shutting down. we have certainly seen other activity in other commodities. we have seenore shutdowns of productive activity. veryber that as prices get low, we will see companies going into distress. in the second half of last year, we had the highest number of u.s. oil and gas companies filing for bankruptcy in a very long time. we are starting to get to a point where companies are coming distressed and operations are shutting down. once we get a cyclical recovery

in demand, we will find a much tighter supply-side. you were talking before about the south african rand coming down very hard today. we need some stability in emerging markets. that may require a more dovish fed. which at this point we don't see. the commodity to invest in in 2016 has been gold. it's the best performing commodity. but as we know, it has been hit for three consecutive years. gold's yearg to be or not? that is in the hands of -- our view has been as the fed hikes three times throughout the , it will puts year

pressure on the price of oil. but for the time being, the drop in equity values and the pressure that is building on the fed to slow down the pace of hiking is ultimately helping gold rally. so the reason gold is rallying is because people are saying, there's a risk of recession. there is a risk that the fed may not be able to complete those four hikes a year this year and next year that the economists are predicting. if that changes it will be very positive for gold. nothing will help gold more than a move toward qe4. which is far from where we are today. mark: great to speak to you again. francisco blanch. lynch, you know what it

means. battle of the charts. there have been many winners in this year's financial markets so far. i have a chart which shows which four. don't spoil it. don't look at that chart. it's going to give it away. the best returns. don't look at my chart. ♪

betty: you are watching the european close. i'm betty liu with mark barton. just beforeittle, we get to you, the nasdaq -- 83 of the stocks on the s&p are hitting their 52-week lows. >> it's a volatile day over here.

the nasdaq is on track for it eighth losing down day in a row. this is its longest losing streak since january 2008. we have the nasdaq biotechnology index back in a bear market. it is accelerating this week. it raises questions. will the nasdaq biotechnology index reach september lows? health care being 16% of the composite index, will be bear market in biotech spread to the broader market? one bright spot. apple shares are up today. it does appear that the stock may be catching support last seen around september 2014. betty: thank you so much. one of the most-watched stocks of course, apple. you guys are always watching the

battle of the charts. it is time for our global battle where we take a look at the most telling charts of the day and what they mean for investors. marke mixing it up because is craving the competition today. mike mckee is joining us. economics editor at bloomberg. mike: we are going to be talking about -- betty: hang on. i think i'm supposed to go to mark. looking at is, what are the best performing assets of 2016. there has been a lot of turbulence caused by china. i'm looking at the best-performing asset. we are starting with equities. the best country to put your money in is the champ of 2015, jamaica. the jamaica stock exchange market index. it rose by 97% last year. what a rise. betty: rum and reggae. mark: get the daiquiris out.

let's party. the champ is the japanese yen. it has risen 2.1% against the dollar. for itsr it sunk longest ever losing stretch. what's interesting when it comes to the japanese yen is speculators have turned bullish on the currency for the first time since 2012. let's get to the bond market. the best-performing sovereign bond market is the u.k. sovereign bond index. we have right of between the u.s. and the u.k. areomists and traders pushing back their view as to when the u.k. will raise interest rates. and commodities, you know who is winning. it's gold. we talked about it with francisco blanch. get your bob marley out. it's all about jamaica. betty: this might be their comeuppance to the markets.

mike, you have your chart. ike: the chinese have been accused of starting a currency war and they say they are being misunderstood. because we are valuing the yuan against the dollar and we shouldn't be doing that. going to they were start valuing it against a basket of 13 other currencies. and if you do that they say, we are not starting a currency war. because the yellow line here chose what happened to that basket of currencies. it has gotten stronger and stayed strong. the orange line is the yuan against the dollar. and that shows the decline. they say, go with the yellow line. betty: they say, that's proof. mike: in the future, that's the way to look at it. betty: mark wins the battle of the charts because you weren't

ready yet. still ahead on the european close, riding in style. we look at porsche. it is showing off its latest sports car at this week's detroit auto show. ♪

mark: this is the european close. i'm mark barton with betty liu. porsche is showing off its latest version of the iconic 911. matt miller is standing by with porsche board member. take it away. matt: thanks very much. just announcing the new turbo and turbo s. from now on are going to be turbocharged. how will you differentiate? >> this is the fastest, the most powerful, the most luxurious 911

of the range. it is the top-of-the-line turbo. all the 2017 generations have the turbo. a 540 horsepower for the normal one and for the turbo s, 580. 60 in under three seconds. in terms of entertainment, we have introduced a modern system. google street view. rear camera. you don't expect that in a porsche. matt: how much importance as the

technology side taken? we have seen a lot of automakers. how key is that for porsche, which is really focused on the driving experience? on makingvery keen sure we don't overstepped the boundaries between assisting the driving and making sure that the driver still is engaged in the driving. that is critical. driving a porsche is essential for us. we are making sure we are not going in the wrong direction. we're working all these new technologies. driving is on the mind of everyone today. we are still working on this. you had a record year in 2015 for sales in north america. to head been promoted sales and marketing for the whole company. do you think we can do it again here? >> it was a big honor for me.

we justus, because between us now, don't repeat it please, i am missing the united states very much. we have a great team in the nuts states. united states. matt: is 2016 going to be another record? goal. it is important that the brand stays exclusive. that we have this ownership experience. the driving a porsche is something special. matt: i wish i could spend more time with you. i have to hand it back to mark barton. mark: that's right.

good to see you. later, mattk to you miller, live from the north american international motor show. we will have more from detroit. eight consecutive days of decline for the nasdaq. that is some losing streak. betty: it makes me want to get in one of those porsches and just leave. we will see where we end up. we are coming off of our lows of the session. it's going to be a pretty volatile session. we will see. mark: see you all tomorrow. ♪

betty: it is noon in new york. welcome to bloomberg markets. ♪

betty: from bloomberg world headquarters in new york, i'm scarlet fu. alix: and i'm alix steel. decline in china stocks and oil prices keeping the pressure on u.s. sales. nasdaq posting its largest losing streak since 2008. is feeling the backlash from the volkswagen emissions scandal. how they intend to bring consumers back. mexico begins the process of extraditing el chapo to the u.s. and actor sean penn is under investigation for his interview with the drug lord. we will go with -- go to mexico city for the latest. scarlet: l