.ondon markets noting back-to-back gains. for the month the european close starts right now. ♪ betty: we are going to take you from new york to london in the next hour. all, your map says it which is that we have all sorts of different directions. mark: we were up over 1%, just a bit of 1%, we are heading for back-to-back games for the first time in over a month. that a substantial if we achieve that. two of this years worst performing groups are leading today's advance, basic resources and oil companies.

bp is the best performer in london, up by 4%. we had a nine day losing streak for these -- for the stoxx 600 oil and gas index. continue torformers be the auto stocks. those stocks that are opposed -- exposed to china. noting, over the last seven years, every time the euro stocks have fallen by more than 7% in the week as it did last week, it follows with a subsequent16% in the three months. that is a fascinating stat. will that be decimated by concerns about the global economy and high u.s. interest rates? but if wee concern, are true to form, we could see a 16 percent rally in the next three months. betty: could be a buying opportunity.

. insurance company a gone, what dutchind the move? -- n, what iscompany aego behind the move? mark: they have bought back millions of euros of their own shares. they want to cut costs and increase return on equity -- boost return on equity to 10%. it wants to lower expenses in the u.s. and the netherlands by 200 million euros by 2018. take gets two thirds of its income from transamerica. aiming to boost asset management and0% within three years seek venture partners to increase its business as well. it is the second biggest gain in europe, up by 9.6%, maybe a stock to keep your eye on. betty: maybe, indeed.

we are watching oil prices here and they're coming back just a bit after those inventory numbers. we are also 90 minutes into our trading session, so let's head to the markets desk where julie hyman is watching oil. oil,: let's take a look at it has come back after bouncing up from the dip that we saw, now up about 1%. this is after that crude inventory report did show a smaller than estimated bill in inventory. it depends on who the estimates are from. analysts were looking for a larger build, although traders were looking for a decline. either way, we did see a build in refined product. all of that right now is still equally a little bit of a bounce, maybe the inventory report was trying -- priced in potentially. the mirroring the s&p has been

doing a oil prices, it is off the low of the session, not in the positives for the day. are lower, sohem following oil in terms of the trajectory, but still not positive here, there are a lot of big movers today. with williams company, the pipeline companies agreed to be bought by energy transfer equity is. december it is down for a sixth session, energy transfer is down for the seventh straight session. it is a $38 billion deal. a not sure we have a check on prices for these companies, but they do continue a sharp decline. 11% --mpany down williams company down 11%. ford and gm both giving outlooks after the close and even though on the face, ford looked like it was relatively positive, the

also announced a special dividend, but it looks like traders are focusing on the outlook before reading it, gm also returning cash to shareholders. it looks like the read on it is more positive. betty: thank you so much. let's check in on the bloomberg first word news. morning, we begin with a rod, they have released 10 american sailors it detained overnight. the pentagon says the sailors departed on two small boats they had been operating with a lost contact. entereds the boats iranian waters because of a broken navigation system. been well, a decade of sanctions on iran may come to an end by monday. see iaea is inspected to report on friday that iran has met its commitments under a new nuclear accord with world powers. that is what iraq is saying. lifted, theys are

would get access to as much as $50 billion frozen in overseas accounts. turkey says one person has been arrested in a bombing. the government is not saying anything else about the suspect, the suicide bombing killed 10 biggestn istanbul's tourist area. mark: it has been a bit of a turbulent year so far for markets around the world from u.s. to europe. to china stocks have plunged, but the big question is, what does the deep dip say about the underlying macroeconomic environment? betty: is there a recession looming? robert kaplan gave his take on what it all means when he sat down with bloomberg's economic ever -- economic editor, his

first national interview since becoming president of the fed. >> markets will go up and down, this has been a tough start to the year. it says a lot about the turmoil in the markets in china, reflective of their underlying issues. and also says a lot about our companies in the u.s. while exports make less than 20% and manufacturing is less than 20%, it is a much higher percentage of the profitability of the s&p 500. when you see weakness, outside the united states and china, it affects our companies, affects their proper -- profitability and affect the market to a greater degree than it might affect the underlying economy. and monetary policy maker, you have to watch these market moves , but you have to realize that they may or may not reflect what is going on under the underlying

economy in the united states. they could go down for two weeks and and rebound as they did in august and september. areunderlying fundamentals still strong, so you have to watch and understand it, not over read or overreact. it takes time to figure out what the market is saying to us. reported overent 0 jobs were created in december, on friday, monday, the markets tanked. investors in the market are reacting to corporate profits and expectation of corporate profits. i'm mindful of the fact that corporate profits in 2015 were down in the s&p. there is not been a lot said about it, but they declined and in the first couple of weeks of the year, so the estimates for corporate profits for 2016 have been revised mewhat down.

it is as much or more reflective of prospects around the world as it is about the health of the u.s. economy. i'm not surprised that the markets are going to pay attention to other things. the job numbers helped, it helped bolster confidence in the u.s. economy. we will have to see. the markets may not react to information in a day or a week, but over time, they normally weigh all this information in a think you will see a strong u.s. economy reflected. >> what are the prospects for the rest of the world and for china and their likely impact in 2016 on the u.s. economy? the forecast for growth outside the u.s., i would call sluggish. they will improve a little bit in 2016, that it is very uneven. in a country like that as well, brazil, russia that are exposed to commodities are actually in

recession. that is going to continue in 2016. india is a bright spot. china is dealing with a number of issues that are not typical -- cyclical. they will take years to deal with. overleveraged, overcapacity and an aging population. it will take many years, so i think the u.s. and the world is going to have to get used to lower rates of chinese growth and i think the world is adjusting. it has implications for commodity prices and it will have some implications for u.s. gdp. companiese world and and the markets are trying to digest all of that. >> robert kaplan was very well known at goldman sachs and harvard, but as a policy maker, they don't know where you are coming rob. would you characterize yourself

as a hawk or a dove? >> probably as a centrist. what i mean is time quite open -- i quite open -- i am quite open to looking at new information. i don't rate unemployment versus inflation. i don't come in with a preconceived point of view as a hawk or a dove, i probably more focused on diagnosing what to do and how to do it. i would call myself a centrist and i think you will see me at times advocate positions that sound hawkish and at times giving in on the facts on what my analysis is an advocate positions that seem dovish. betty: that is a centrist. looking at a live

picture of secretary of state john kerry speaking in washington at the national -- he has made some remarks about the release of the american sailors by the iranians, saying he is pleased of the sailors were safely returned. he thank the iranian authorities for the cooperation and said the peaceful and quick resolution critical.omacy is by all indications, the american sailors were well taken care of i the iranians,. ahead as the european markets close. we are looking at a story of ge cutting jobs. mark: after it bought from france's -- the company is now cutting 6500 jobs in europe. we will have all the details just ahead. ♪

betty: you're watching the european close, it is time for the business flash, a look at the biggest business stories. shares of general motors are higher today. there are increasing their forecast for annual earnings and listing the stock by bancwest -- buyback plan, raising dividends. they say sales will keep growing in north america and china, but at a slower pace. ge will move its headquarters to boston according to the boston globe which says the announcement will come tomorrow. ge has been in connecticut for more than 40 years. last summer, they threaten to leave after the legislature raised taxes on companies and wealthy individuals. that is your bloomberg business flash for this hour.

mark, we know that ge is making the headlines in europe on jobs. mark: they're planning to cut about six and a half thousand jobs. in alex webb. alex, thank you for joining us. where of the of these cuts going are theplace -- where bulk of these cuts going to take place? >> they break down france and germany because they have strong unions, so 1700 and germany, 770 in france. mark: is germany the reason for these cuts? demand for the gas and steam turbines and cost. right?s that

can you still hear me -- it seems like we lost in. -- lost him. what matters is when ge said it would buy the energy business, it made this promise not to lose jobs in france. they are sticking by that pledge ultimately, to create a net, 1000 jobs in france. to win government support, it had to make that pledge. even though it is cutting these jobs in france, it will eventually create a net amount of jobs. we cannot get back to alex, so hold that thought. will ge up by by its promise to create jobs in france? ge had promised to create 1000 jobs and realistically, it

has to create 1800 jobs. and promised to ensure that every job it destroys it will re-create. industry minister was very straight on talking points in paris, saying that they will stick to it by the letter. mark: this is something that is happening in the energy industry, isn't it? bp announced cuts yesterday, so i suppose that's -- this could be the beginning of the new trend with slumping energy prices. this has nothing to do with the sliding price of oil. >> this is a separate issue. the thing you have to look at that ge really wanted was access install power punt -- install power plants and turbines -- installed power plants and turbines. manufacturing process

-- capacity to maintain lucrative service and maintenance contract elements. betty: i imagine that these job cuts are a pretty big shock to the french government. the investing trinity was expecting job cuts of this scale, about 14% of the workforce in europe. for the french public, it probably comes as a surprise. very careful about being wary about wanting to sell to a u.s. company. -- that isoften very why they came out and said they will be very strict about this and ensure they stick to the promises. betty: thank you so much, alex webb from munich. still ahead, we are going to russia in light of lower-than-expected oil prices. russia must now cut -- cut spending to prevent a deficit. we will hear from their finance

minister. courtney: -- ♪

mark: this is the european close. oil pricesc fall in is posing many challenges for the russian government. it needs to cut spending and boost revenue to avoid a deficit. interview, wee caught up with russia's finance minister to see if there is a solution to the oil woes. >> you have said that if the government does not cut the budget by 10%, russians can expect a crisis like the one the country had in 1998. explain that. if the finances are not adjusted to the new conditions we find ourselves in, we can expect a deficits and inflation overhand, as was the case in

1998, if we don't take the right decisions regarding our financial needs. revenue the budget parameters were cut by 10% relative to gdp. that occurred because in real terms, the budget trend, this happen all on its own, out of our control due to devaluation and the depreciation of costs, including salaries and infrastructure cost. we should not make the same mistakes. we must revise the budget to meet the new conditions. >> there are an awful lot of parts of the budget that cannot be cut. the military, the social sphere. would it make sense to change the rules and cut in those areas as well? decided to we have not cut defense spending, we will see how the situation develops.

what i want to say is that in 2016, we will make it through the year, but we have to sing -- we have to think beyond that. we have enough reserves and resources for the year, but this year, we need to make decisions that will allow us to balance the public finances in 2017 and beyond. ryan joins us from moscow after that interview. 1998 and that was a pretty ugly time overall for the entire world. was a very ugly time in russia. remember august 17, 1998, referred to as black tuesday. it was a day when they began to default on their debt in the currency fell threefold. inflation was out of control, unemployment was ripe.

finance minister invoking the ghost of 1998 to say their budget is based on oil prices of $50 a barrel. if they don't cut their budget by 10%, the budget deficit they hope was going to be 3% is going to be at least double that, then they will be able to control the situation. budget byutting the this 10% -- is that going to be enough to rescue budget spending -- to rescue the budget? >> is not and he was clear on that. he indicated that it would do about a third of the job. in addition, they need money for privatization and they need their reserves. he said the one reserve fund they are using to get them through this year.

they can live through this year with budget cuts, maybe the ruble will we get a little bit, but he is very concerned about next year, the year after that. what he said is in what he indicated is that at that point, pretty much anything is on the table. a lot of the budget is protected. social spheres, salaries and pensions, that kind of stuff could be discussed as an option, going forward. mark: thanks for joining us. we are minutes away from the european close. stocks could close higher. ♪

when you're on hold, your business is on hold. that's why comcast business doesn't leave you there. when you call, a small business expert will answer you in about 30 seconds. no annoying hold music. just a real person, real fast. whenever you need them. so your business can get back to business. sounds like my ride's ready. don't get stuck on hold. reach an expert fast. comcast business. built for business. betty: welcome back to bloomberg markets. 11:30 a.m. in york and 4:30 p.m. in london. which means the markets are just settling down and closing for

the day. it has been a mostly higher day. i know you guys struggled to keep some of those gains. mark: we were up 1.8% at one stage. what is significant is the stocks have not risen were to test for two consecutive days. groups led the charge today. basic resources, oil and gas companies, bp share price reflects that. up by 4.7%. stoxx 600 gaining. a lot of merger talks. think of pop a lori -- banco shares higher. , whenhe last seven years

the u.s. stocks 50 has ball in by 7% or more in last week, in the following three months, it has rebounded by 17%. will history repeat itself? betty: only time will tell. you and i talked about this earlier. saw a nicensurer jump on a buyback announcement. mark: they are buying back 400 million euros of shares. that's the first reason shares had their biggest increase in three years. shares of saying the lowest in almost four years last week. it has been a bit of a turnaround for this company which owns transamerica in the united states. it wants to see return on equity of 10% and lower expenses in the u.s. and the netherlands by 200 million euros. it wants to grow asset management by 20% in three years.

it increases its asia business as well. upper 5% higher, the biggest increase in almost four years. betty: you know what i'm watching here. oil prices. we are tracking oil at very closely. oil very closely. bouncing back to the lows of the session after those inventory numbers came in. not as big a buildup you might expect. there were some expectations that we might see a drawdown in inventories. that is perhaps why you saw that negative reaction. stock market coming back as welker we are still lower. -- let'sck in him not check in on our first word news. >> belgian officials say they have located three apartments used by the paris attackers. the brussels rooms where bombs were made was just one of their

hideouts. they also had to apartments and towns south of the capital. one was used by the suspected ringleader who was still on the run print lebanon is no longer welcoming syrian refugees. lebanon has accepted one million refugees from syria since the civil war started five years ago. the open-door policy has been dropped. more than 400 syrian refugees forced to go back last week and the change means of syrians who stay are breaking the law. they are notn and taking any chances this time around. mexican officials say they are constantly moving el chapo from cell to cell. the prison has 24 hour video surveillance which covers every inch of his cell. the selke escaped from had a

blind spot near the shower. he escaped from had a blind spot in the shower. fresh flowers and photos of those killed inside filled the cafe's front door. 130 people died in november's terror attack. global news 24 hours a day powered by our 2400 journalists in 150 news bureaus around the world. betty: thank you so much. uncertainty and volatility in the market is like a nail in the coffin for investors. has information on what is going on. through a hugeng amount of volatility. i don't see anyone being immune from volatility. ,etty: it seems for the moment things are turning a corner. we've risen by the second

consecutive day. that has not happened since december 17. let's chat with james bevan all about these things. hi, james. a relief rally. statu buy into that lovely i said earlier. it has risen by 16%. are we heading for a big rally or not? james: i worry about these extrapolations. we have the worst record ever for the first week in january for the s&p 500, even worse than 2008. for me, it's all about fundamentals. what we saw at the beginning of the year was a degrading of securities when it was a significant down drop in the earnings numbers. i'm absolutely of the view that we are still in a bull market.

we've had a correction from which there will be a sustained rally. mark: the outlook for earnings as much aseriorated the selling implicitly discounts. james: i see this as an excellent long-term buying opportunity. prices will had lower before they had up for a sustained period. i don't believe we are heading for a bear market. betty: why is that? sign: i see absolutely no we will face a global recession. report revenue growth of performing and quite good earnings numbers and that will allow entities to demonstrate continued value added against cash and bonds. it is not buyers in the conventional sense. it will be the companies themselves. betty: more buybacks, then.

someone who's been a bit more bearish about the global economy, a very prominent voice is larry summers. we had him on early this morning he talkederg ." about the impact of the fed rate hikes and where he sees those rate hikes. >> i be surprised if the world economy can comfortably withstand four hikes. basically, markets agree with me. that's why, despite the statements being made in the markets are not expecting -- made: it's are not expecting made, the markets are not expecting 4 hikes. james: i don't believe the u.s. economy will justify such a shift. at thehave mr. fisher

federal reserve saying earlier this week that there would be more than four hikes. they keep the market guessing rather than provide too much weed information that can be used in speculation. that can bermation used in speculation. a very different view on the streets. a cut if the u.s. economy does not strengthen materially. one rate hike, maybe a cut. you talk about buying back -- buybacks. why do you think they will be the big driver of eps? shares have had their biggest jump in three years. you talk about the gravy train pulling into the station. is the buyback gravy train coming back to the station? james: there are two very different sorts of buybacks investors need to consider.

ofst, there is a buyback commercial engineering, raising debt, change the nature of the balance sheet, which magnifies earnings-per-share and increases riskiness. there's the other sort of buyback where a company produces excess cash. if it is a free cash flow yield in excess of the cost of cash, logically and reasonably is in the interest of shareholders for those shares to be bought back. we need countries like japan where so much cash is held on the balance sheet to the disadvantage of shareholder value. mark: they are undervalued. buy the beneficiaries of the ongoing surprise in european domestic demand. be wary of european cyclicals. what are you overweight right now? james: i'm overweight good

quality growth companies. i'm not one of these people who believes we will have a significant cyclical recovery. they are still under waiting cyclicals. -- underweighting cyclicals. it is a risk because the uncertainty is there. the incremental return on your investment is still poor. it is the companies that can participate in better economic conditions. bp, vodafone, those are the names -- mark: china, the carmakers, do you short them? james: i'm not in favor of higher -- having high exposure to china. think you for joining us. -- thank you for joining us. 4:40 in london. coming up, the battle of the charts. been inhas the decline

commodities and commodity related equities? i have an explanatory chart for you, next. ♪

betty: welcome back to bloomberg markets. live from london and new york, this is the european close. i'm betty liu. mark: i mark barton. -- i'm mark barton. , six current and former bankers will go to trial in september. on charges they tried to rig a benchmark interest rate. the accused worked for barclays and deutsche bank. they denied that they tried to manipulate the euro interbank trade.

mueller had a meeting with u.s. regulators today. california regulators rejected bmws proposed engine fix -- bw's proposed engine fix -- volkswagen's opposed engine fix. theid not comment after decision. that is the latest business slash. betty: we will take a quick look before we get to your favorite movement, the battle of the charts. we have abigail doolittle live at the nasdaq. we are still on declines in the market. abigail: another volatile day at the nasdaq. we opened higher on the composite index, now trading down by .5%. led by health care, the biggest sector weighting. another non-biotech health care stock down sharply

come express scripts. shares plunging after health-care insurer anthem, its biggest client, has threatened to leave unless express scripts produces $3 billion in cost savings on drugs. the selling action has caused gas through its moving averages as investors worry about the possible loss of 14% of revenue. turning to the other side of the ledger, one stock that has been trading higher, microsoft. shares up on an upgrade from morgan stanley to overweight from equal weight. they are bullish on the possible acceleration and earnings growth. due to the durable office franchise. the new price range suggests this stock may finally crack its current record of $60 set back in 1999. betty: thank you, abigail.

abigail doolittle at the nasdaq. time for our global battle of the charts. we take a look at the most telling charts of the day. what they mean for investors and for viewers, you can access these charts by running the function featured at the bottom of your screen. kicking things off, welcome back to joe weisenthal. joe: everybody knows how miserable the greek economy has been. within all this volatility we've been seeing lately, there's been some good news out of greece. i've got a pop up. sorry about that. i'm a little rusty. this manufacturing number at its highest in two years cpi getting out of deflation, at its highest level in two years. production returning to positive territory recently. last summer, people could not be more negative on greece.

some of the data is going in the direction you want. digging itself out of an extraordinary whole. -- hole. betty: they all converged to one point and rebounded together. joe: the last summer, you had all the political turmoil, the banking stuff and the referendum. since then, there's been a bit of a pump. -- bump. they have sat me down to try to contain my excitement. it is not going to work. i'm examining the commodities route. let's start with the bloomberg commodity index. , 22perennial favorite materials. if a big, fell to a 1991 record yesterday, fell to a 1991 record low.

where commodities go, miners follow. that is the orange line right there. the gain in the leading mining companies. -- to a 2004 low yesterday. we cannot do commodities without doing the oil and gas industry. the green line is the bloomberg world oil and gas index. which on tuesday fell to a 2004 low. in gauge has sunk by 8% 2016. it is headed for a 30 year of decline. what will happen now? that is the big question. hedge funds are positioning for more losses. materials --f raw not of raw materials since 2006. the relative strength index for

the world mining index shows both of these gauges are oversold. chair,fore i fall off my listen to the words of the director of the fulcrum asset management. she's given up trying to call the commodities bottom. have you given up? joe: i will never give up. i will keep calling it every few weeks. you've had a two-day winning streak. you took us to jamaica earlier this week. i will give it to joe because i'm thinking about greece and olive oil and wine. joe: i did greek colors. betty: there you go. mark: you forgot uzo. betty: still ahead, the iconic photography of annie leibovitz.

>> she is a global icon, they are a global bank. women 2016s, traveling to 10 cities over the next 12 months. join me for a conversation with annie leibovitz. ♪

betty: in today's pursuits, the iconic photography of annie leibovitz is on display in a new show in london. 100n 2016 features over portraits of icons like gloria adele andell -- hillary clinton. we began by asking about women as role models. >> women have bigger and stronger role models? >> absolutely. she is helping people, helping women come along.

she is not that different from me in that respect. i felt nervous about playing that role, how to help women go to that next step. this work shows how diverse women are. you've seen before. >> hillary clinton was in the last series. each of -- you photographed her as first lady. she is now running for president. is america ready for a female president? >> absolutely. there should be no -- is america ready for hillary clinton? that is another question. let's elect hillary and move on. it's inevitable the way obama was inevitable. i think she is the best qualified.

i worked with her from when she was first lady, when she ran for the senate, when she was secretary of state, and now, running for president. i will spend some time with her this year. she will present the whole other side of things and with her experience now, she is the best qualified. >> social media will run the selection like we've never seen before. media, for her theaign, should it be politician hillary or the real person? >> you are seeing the real person. she is trying hard to be the real person. past, sometimes you would

see some sort of strange hairdo on her. she doesn't care about that stuff. she doesn't have the time to care about that. she's being more careful about how that is presented. the issue has been, which is not in front of cameras or people -- when she is not in front of cameras or people, she is like a real person. she is trying to bring that real person more out. her strategy to start this can't helpry early but bring out the real person. betty: that was photographer annie leibovitz. mark, i've got something here. can you see it? powerball. mark: is that my ticket? betty: this is actually our hairstylist's ticket. he said to me, i want it back.

our lottery is now worth $1.5 billion. if you lost money in the stock market, you might be able to win in the lottery. what would you do with $1.5 billion? mark: how much is it after-tax? million? i need a room where no one is allowed in it. where i can lock the door, listen to david bowie, watch my films and live in peace. this money would buy me peace. i need peace. what about you? betty: that sounds great, but we have no chance. in 292 million. ♪

>> it is noon in york and 1:00 5:00 in hongk and kong. welcome to bloomberg markets.

from bloomberg world headquarters in new york, good afternoon. here is what we are watching at this hour. stocks taking a turn for the worst again, dragged down in part by oil. oil prices making a sharp reversal, although crude now relatively flat after new data showed an increase in u.s. stockpiles. bruce sits down for exclusive interview with erik schatzker. his thoughts on the u.s. economy and why he says it's the perfect time to invest in china. larry summers advises the fed not to ignore current market turmoil. he says investors are sending an ominous signal to policymakers and should prepare for the worst. for more on today's activity, let's head over to the markets desk where julie hyman has the latest.