london as we wrap up the trading session. we have climbed back quite a bit from the lows. but we are still down for a second day. investors are twiddling their thumbs ahead of the release of the policy statement. the european close starts right now. betty: we are taking you from new york to london in the next hour. nobody wants to take a big position ahead of the fed meeting. mark: exactly. it was fascinating to see what happened when the inventory data came out of the united states. crude supply climbed. 600 move withoxx the price of oil. we have seen it down by as much

said, theas you statement is just in a few hours time. a daya day nominated -- dominated by earnings. we have the world's biggest chemical company, check out the shares, down by 2.7%. -- it took a big charge due to lower crude prices. , want to show you novartis that is down today. it also missed earnings estimates. unit.e of revenue and the we also have the strength of the dollar hurting the value of global sales. betty: we had some of the worst performance here. did we get better news for shareholders today? mark: so-so.

-- help banks offload the debt and you would think that would be a good thing but look at the reaction in italy. this deal won't count because priced backing will be at market rates. look at what is happening to the royal bank of scotland, one of the big recliners. a 3.6 billion dollar hit to the value of its assets. more moneyng aside for past misconduct. what this does is overshadow the efforts to reinstate the dividends. actuallyny hasn't given the dividend. of course, that was bailed out by the u.k. government. we keep hearing this again and again. betty: legacy issues in deed. one legacy issue is the case on libor.

five x brokers accused of helping a convicted traitor break the benchmark interest rate has been acquitted i a london jury. liberations on 86 person are underway right now. by thejoined now investigative reporter. this must be a big setback for the fraud office in the u.k.. >> absolutely. it is a huge surprise. dayjury came back in one after deliberations having had a four-month trial. that says a lot about the prosecution's case. had a lotoffice has of botched investigations in the past and have seen some progress in the last year with a number of successful prosecutions including tom hayes.

seem to have taken a number of steps back now. betty: where did the prosecutors go wrong? >> you can never go -- you can never know with a jury trial. it comes down to gut feeling about the individuals. that a four-month trial can, back after one day with a result is informative. has been a sprawling and complex trial. what does this mean for the liber investigation? >> we have the parallel u.s. investigation and they have to do something to knock the confidence and affect the future prosecutions. have a number of other trials down the line coming up. those of visuals are about to face the u.k. court in the coming months. mark: thank you.

theinutes until the end of wednesday session. betty: in deed. 30 minutes past the inventory data that came out about oil. want9 million barrels, i to get to the latest on oil prices and the markets with julie hyman. julie: i don't even think i can say wednesday the way he said it. it is the middle of the week so we get the inventory data i did takes some time for it to shake out. crude turned positive now, even though we saw larger than estimated inventories. data we gothe trade from the petroleum institute, the market seems to have braced for it. we had a buildup of 11 billion barrels -- 11 million barrels.

there is relief in stocks as a result. take a look at my bloomberg terminal. we have oil versus the s&p 500. that is in white. so we have recovered although it is still not entirely recovered all the way today. and here is a correlation that we have shown periodically. you can see, as we head into january, it does just keep climbing. the three major averages in the wake of the sharp.ry data seem particularly for the nasdaq. i'm going to get more into that in just a little bit. the dow and the s&p are also being dragged down by oil and earnings. now on thes check in bloomberg first word news with courtney donohoe. courtney: the leader of the

now in custody. they were stopped on their way to a community meeting and shots were fired at one of the supporters were fired -- were shot. says he will skip thursday's debate in iowa. he says he has been treated unfairly by fox news, who is holding the debate. instead, he will be at a fundraiser for veterans. and with all due respect will be leading up to the iowa caucuses. herecoverage will be right on bloomberg television at 5:00 eastern. the attorney for the affluenza teenager says he is heading to the u.s. to face charges. he and his mother were detained

in mexico last month. he used the affluenza defense in a drunk driving crash in 2013. the refugee flow to europe won't slow down this year. as many as one million people will seek refuge in europe this year, that is similar to last year. the fighting in syria and iraq theort -- is thought to be main cause. and thousands of holocaust survivors gather today in auschwitz. dayal news, 24 hours a powered by our 2400 journalists. i am courtney donohoe. betty: thank you. we will have our special edition of bloomberg markets with scarlet fu and tom keene -- that will be at 2:00 in new york and 7:00 in london on bloomberg

television. you do not want to miss their coverage. ♪

mark: welcome back to bloomberg markets, live from london and new york. this is the european close. betty: markets are anxiously awaiting the latest statement from the fed today. we will bring that to you live. no expectation on any great move that we want to know what they are thinking. is howhe big question the recent global market volatility impact the interest rate hikes. joining us now is richard jeffrey. it manages about $42 billion in

assets, thank you for joining us today. within the fedke statement for a stock market rally to occur after? richard: i suppose what the markets are looking for is reassurance that the fed is not going to stamp on growth. regulatedcrease the slow growth. that is what the markets are looking for in the statement but to be honest i don't think there is a great expectation today. it just keeps the debate simmering. mark: and the debate is simmering quite actively. as you look at the fed funds futures, are you veering more towards the fed or are you on the side of said fund futures? somewhere in the middle, isn't that the best

place to be? there are visioning raising rates by a quarter percent. but there is a downside if they don't achieve that rate. and i think we may see two or three rate increases this year. four are unlikely. and we do know that when you get --es of unstable and he times of instability, it forces the fed hand. we talked with mohamed el-erian yesterday who continues to say that we have to be weaning ourselves off of central-bank policy. and we haven't done that yet. i want to know if you have a reaction. >> we have lost the central banks as our best friends. the minute there would be volatility we would get a statement out of federal reserve to calm things but that is no

longer happening. stabilizer and oil has lost the stabilizing effect. you losestabilizers the more volatility you get. betty: it is hard to break up but we do have to make up at some point. i think the fed should have started to raise interest rates a while back. normalizeen growth for quite a long time now. is right for the federal reserve to normalize monetary policy. the problem that we have is that inevitably, the economy hits bumps in the road from time to time. and when you hit bumps in the road, it is nice for the authorities to be able to take action to try and smooth the way through. and that action is normally edging interest rates lower, it

even if it is for a short time. they can't do that now, there policy locker is empty. it is sensible for the federal to start edging up interest rates but it would have been sensible to start a year ago. betty: right, that is what a lot of people are saying -- a moved too late. we are looking at asia points. we want to figure out where the economy is heading. you can look at economic data and what we are seeing in earnings. we had apple results last night that show global growth slowing down, they are having a hard time selling their products in china. what do you think apple tells us about the global economy? richard: i think some of the emerging economies -- it does tell us that there is weaker growth in those areas but don't forget, you are talking about a market and economy that has

become saturated with apple goods. there is an interplay there with a business that is product specific. economies areng slowing down but i'm not convinced that the western world or western industrialized economies are slowing down. i think we are's -- i think we are likely to see more growth then 2015. the slowdown is in the emerging economies. mark: apple is the big corporate story but the big corporate story here is shell. the question that has been simmering in the background is, has it paid too much given the 50% slump? if oil prices remain where they are today then they are going to have to work very hard to make this acquisition

function properly. but in all probability, oil prices won't stay where they are. medium-term we expect them to trend higher. mark: the breakeven rate is $50. shelld: i'm sure that would claim otherwise. i think that if we take a long-term view they will get this to work. but it may be harder than they think. mark: the stoxx 600 fell last week to these lowest level and the strategists still said we had 20% upside from the low of this year because of the ecb and the improving domestic economy. richard: i am reasonably positive that i'm not sure about 20% upside.

one of the problems investors have at this moment is tuning into the implications of slowing growth in the western world. and i think a lot of people think back to the three recession time when the economy grew and it was exciting. that wasn't normal. that was abnormal. that is why we had such a deep recession afterwards and the financial crisis because it was abnormally strong. 2%.al growth is closer to and that will have profound implications with the kinds of returns they will be getting out of risk assets. part of the problem that you see at the moment is people tuning into that. mark: i want to ask you a question on inks but we have is not all of our time. jeffrey, stilld ahead on bloomberg -- the

extensive oil and gas assets are dragging down. how is a company weathering the storm with the oil price plunge? ♪

betty: live from the bloomberg world headquarters in midtown manhattan and london, you are watching the european close. in europe. 4:21 here betty: we are almost to the close of trading in europe but we are trading heavily in new york. i want to get a check with julie hyman. julie: apple is the big mover of the day. it posted its first sales decline in more than a decade, talking about declining demand for iphones.

this was hinted at by a lot of talk from analysts and supply chain checks, they have fallen by about 6% and it is set up for the worst day since last august. we will be updating you on that as we watched throughout the day. we have seen a lot of weakness in technology, not just today but this year. thatsoft is not part of acronym but it felt today. also that is also declining. apple is not the only one with disappointing earnings. boeing is a big part of the story. it will miss analyst estimates by more than one dollar, share will see lower deliveries on its jetliners. those shares are down a percent. just another roundup of the earnings news that we heard about -- taking a look at u.s. steel. not only looking at shares

bonds are it's clenching as well. 34%,are seeing a yield of an incredible number. shares are down 13.5%. it reported its third biggest quarterly loss on record. the health insurance company, it is declining after seeing higher cost as it picks in moment will go up this year. we are seeing at&t down a little bit on a revenue miss even though profits beat estimates. and -- is down today after its forecast also came in short of what they had been anticipating. it also announced a new seo and about 800 job cuts. the parent company is being acquired by dell. speaking of deals, a quick check

on one in the oil industry. l got shareholder approval bg.cquire both trading higher in london trading. betty: thank you. that was julie hyman. for more on that story, we have exclusive insight into that $51 billion deal. -- push for support on that deal. >> we support it because this is what you want a management team to be doing in an environment where oil prices are declining, making opportunistic acquisitions. the key thing is for the shareholders, substantially goodning -- you have

access to natural gas assets in australia. you solve an awful lot of problems at a time where it is relatively cheap to do it. ultimately, the value of this deal is delivered over decades. so the stock price today or next week may not be the most relevant benchmark for it. but share market value over decades, with a business like this, that is why we support it. >> is this deal representative of what we will see later in 2016? >> we are seeing a number of deals with smaller companies but -- wene is gargantua's will see more of that. you will certainly see more where companies become distressed. barrel,shell is going to outlast competitors.

the other big majors have not made acquisitions, you don't see a flurry of them. ultimately, the worst time to sell your company is when oil hits its trough. mark, the european close is moments away. towards are inching gains. we are literally down by .09%. if we finish higher, it will be the fourth day in five days. we are waiting for the fed policy statement. ♪ 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 here with mark barton. let's get a check on the news. courtney donohoe has more.

secretary of state john kerry could not get china to see things his way on north korea. china resisted appeals to oppose -- impose tougher sanctions on north korea. china has been opposed to any moves that may destabilize the regime of kim jong-un. it wants to restart talks with the north koreans are it the next stop for hassan romney is france. scheduled to meet with french president francois hollande. he will seek a deal to buy more than 100 planes from airbus. iran's navy warning that a u.s. airship to leave an area where it was conducting drills near to narrow strait according officials. the u.s. denied that its operations in the region were effective. global news 24 hours a day powered by 2400 journalists and more than 150 news bureaus around the world. betty: thank you.

european markets are finishing the day. where are the markets settling? mark: we could be finishing higher for the fourth day. look what happened earlier in the session. it was the movement in the oil price later in the afternoon that helped push the stoxx 600. today dominated by earning the likes of apple, boeing. bsf, the big chemical maker in the world. shares fell by 2% earnings amid estimates because of its oil and gas division. it took a 600 million euro charge due to the lower oil prices. it does anticipate that prices of oil will remain at the low level in 2016. sweden, so much to tell you about. ericsson, the telecoms acquit and maker, 6% lower today. --sing estimates let w network sales in emerging markets continuing to be weak.

it rebound in mobile broadband spending appears -- did not appear. two of the many earnings numbers we have had today in europe. betty: i know european banks have been a big focus so far not just today but the whole year. are things bottoming out for financials? mark: it is question of italian lenders will be asking because they have been among the decliners. it will do it on focusing later. check out the big news out of italy today. italy agreed with the european commission, the executive arm of the european union, to help bt.ks of load their de disappointing news for the state hold lender in the u.k. down by 2.5% today. the big news was it to the 3.6 billion euro hit to the value of its assets and also it set aside

more money for past misconduct. more questions about its ability to pay dividends since the height of the financial crisis. this lender was bailed out by the government. .hat we said earlier, legacy legacy issues continue to weigh on banks like rbs. betty: let's stay on banks for a bit longer. today, francine lacqua had a chat with the chairman of banco santander. they talked about the bank's interest in italy and what it is like competing in a volatile u.k. market. >> we continue to invest. we are investing a lot in digital. we are doing many -- a third of account openings are online. we have good mobile banking app. over one million mobile banking users. i think the u.k. is an

attractive market. i think europe is stronger than the u.k.. stronger.is also createve these customers and will continue to create more jobs if we are in europe. if the u.k. is in europe. i also think europe has to be more competitive and we welcome that the u.k. helps us be more competitive. that's what i have said and that is what i believe. ultimately it is for the british people to decide. francine: there are rumors you are buying rbs branches. ana: we're focused on organic growth. .his year, we bought portugal we can deliver good results for shareholders are you growing top line, paying dividends and finding growth organically. we will look at inorganic

opportunities. we looked at brazil in 2015. we are going to be very disciplined. we did not do those transactions. if we analyze, and we could analyze some other options, we will always be very disciplined. francine: there was a rumor about santander looking at -- pluswe are in nine markets europe, consumer finance. italy is not one of them. we do corporate business but that is not one of our 10 markets. having critical mass is important. 10%.st of these markets spain and portugal, we are at 15%. critical to compete in this environment. botinchairman ana speaking with francine lacqua. let's turn to managing editor of

finance elisa martinuzzi joining us. this big deal has been struck between italy and the european commission yet italian banks continue to decline. does that tell us that this deal might not be enough? elisa: i think it does. it has been long in the making and anticipation was high. having said that it is very much a watered-down plan compared to what the talks that had gone on initially. it is not a bad bank asked such. it is allowing banks individually to structure their bad debt in a way they can get guarantees from the government at a cost. this is supposed to be making the bad debt more palatable to investors who should be willing to pay a higher price. do, it will also widen the pull of investors that

can invest in this type of debt which might make economic sense but because of the structure it has not been able -- they had not been able to sell this kind pension to 1 funds. mark: essentially or seemingly ruling out a bid for mont today talk in the m&a banking industry isn't there? a year ago almost to this day the prime minister pushed through a radical reform that was supposed to push through a wave of consolidation among second-tier banks, corporate lenders. that has yet to happen. the creation of -- the agreement with europe will facilitate those discussions among the banks now that they have more visibility and what they can do with bad loans. time is running out for the lenders to combine.

there are some deadlines set by the laws in terms of when they need to turn into joint stock companies at which point they become in play. mark: thanks for joining us on this big day for italian banks. live from milan. mark, your markets have closed but stocks are on the move here. incredible here that we have seen this clawback from the lows of the session on the dow and s&p, and nasdaq. nasdaq faring the worst among the averages. a lot of the big tech stocks hit today including apple. abigail doolittle has more live from the nasdaq. abigail: all true what you just said. the selloff that the nasdaq is still happening. it is not being led by the biotech index with the mbi down even to the nasdaq largely on strength out of biogen.

beatingfourth quarter estimates. the company made $4.50 per share up 20% year-over-year as its top ms drug had a record quarter. the management just a few weeks ago at the jpmorgan health care conference gave cautious comments. in a way they sandbagged the street. we have the stock surging today but still down about 40% from its peak last year. off on aares are boston globe report that the massachusetts attorney general says gilead may face legal action unless it lowers the pricing on its hepatitis b drugs. betty: thank you so much. abigail doolittle, live at the nasdaq. biotech drugs, fourth-quarter earnings missing estimates. revenue plunged in its alcon eye care unit. the company's new or drugs and pipeline.

mark: here is what the chief executive told us on bloomberg about demand for its new drug. >> if you look at the innovation machine novartis is in the pharmaceutical division, we have generated a number of new medicines that are growing significantly. parte offsetting a large of that patent expiration. mark: bloomberg intelligence analysts santa rosa sam fazeli. does it fit into the novartis world? sam: great question. exact question was asked on the call by one of the analysts. the real answer is no. there is no obvious crossfield. apart.e farm

this is a medical device business. they are saying they want to be businesses that are the leaders in those fields. anything in the health care world could fit that description for novartis. if that is the method they used to assess whether this is a fit, it is a fit. if you look at the strategic fit , i don't think anybody can put a positive spin on it. mark: the key growth drive is in the form of business -- the pharma business, how are they faring? sam: kos -- it is on its own in the moment in the space it is going after in terms of the way it works. there is competition coming up the road. , a miserly sale of $5 million in the fourth quarter. that is not really the sort of numbers people were looking for. part of the negative feel around

the stock is driven by that. they have given a bunch of explanations for this. some of it does make sense but that was one of the drugs -- one of the things we can follow on a weekly basis to see if bear overcoming the barriers they are facing. a lot of hope factor for that particular drug. people are forecasting $5 billion in sales. we need to go faster than this. betty: what about countering the trend against higher drug prices? sam: an excellent question, especially with the discussion that happened last night. if you listen to them with regards to price pressure, price pressure in their generic is this that is a low price business in the fourth quarter or you can put try to tease out where that is coming from.

i'm not sure we got a lot of detailed answers. this price issue is not something that is new to the pharma industry. it is certainly something we need to think about as new products come along with big price tags. markets forng the licensing deals as low-volume ration create more opportunity, what can we expect? sam: novartis, johnson & johnson , i'm sure someone can come up with a nice axiom for all of this. everyone is talking about it. valuations have come down that we have got to be careful. when valuations come down so fast over a quarter, three months, are you really going to want to sell? does the world need to get a lot worse? i don't think the data will tell us acquisition in terms of volume go up during bad times if you want to call this a bad time. mark: great to see you. sam for zoellick. four: -- same for zoellick. bigill return to today plus

banking theme. the u.s. versus europe. who really is on top? the charts never lie. see for yourself after the break. ♪

i want to point out to you guys how far we have come. we have climbed from triple digit losses on the dow in the last hour. now we are up 45 points. the s&p has recovered all of its losses. nasdaq, coming off of its lows of the session. oil prices continued to climb after that inventory data showed a buildup. this is about an hour ago that we got those numbers. let's not waste any more time. it is now the global battle of

the charts where he take a look at some of the most telling charts of the day and what they mean for investors. you can access these charts by running the function featured at the bottom of your screen. kicking things off is joe weisenthal. joe: i want to talk about ireland. a report came out examining the crisis from several years ago. and lots of places. i want to talk about how much of a change their has been. the yield curve today where yields are almost negative out to four years versus the yield curve five years ago at that same level. yields were so much higher. it shows the incredible progress ireland has made since the worst areas of its crisis. now another one of these incredibly low flat yield curves we see around the world. a few years ago it was not. betty: mark, you were promising

something special. mark: what is going on with european and u.s. bank stocks? that is the question i'm posing today because banks in europe are the worst performing industry group year to date. this is a chart -- a year-to-date chart. any mina number below 100 is a negative figure. the green line, the stocks 600 183 billion euros. on track for its worst month since august 2001. only one bank stock has risen this year. i will give you so much money if you guess which one. i won't even waste my breath. betty: what low expectations you have. mark: i can't waste time with you thinking. even i did not know that until i looked it up. european investment banks are being pummeled by deutsche bank.

hurt by a slump in revenues. rising costs tied to compliance. the big decliners have been italian lenders. alisa told us about them in the last section. record, european banks are valued at nine times estimated earnings which is the lowest since the summer of 2012. what about financials in the united states? they are on track for their worst month in four years. this index has fallen by 11% this year. the second worst monthly performance since 1990. last month investors were bullish on u.s. financial because of higher interest rates. we know what has changed. fewer rate hike concerns from the energy sector. analysts are revising down forecasts for earnings from this industry as well. the u.s. financials are valued at 12.8 times earnings near the

lowest in almost three years. is it time to buy? betty: we will find out and we make it more clarity after the fed meeting later today. i think mark took away some of your airtime, joe. joe: i agree. betty: joe wins for reminding us about ireland. mark: i am half irish. i don't mind. well done, joe. betty: that is our battle of the charts. still ahead on the european changing. times are it used to be that cell phones were not allowed in four and five star restaurants but now it turns out everyone -- foreign five star restaurants now turns out everyone likes to take pictures of the food. i apparently now you can do that at high-end restaurants. we will be back. ♪

betty: intimate's pursuit, mobile phones in restaurants -- in today's pursuit, mobile phones and restaurants are no longer taboo. you could not bring them in. them.ots are warming to a big reason is social media. we love to post our food on social media including me. i'm guilty of it. i am one of those people. joining us now is richard vines. richard, you are no fan of these phones either. you want to call police on these people. they said, how did you get this number and told me it was a legal so i gave up on that. i used to load mobile phones -- i used to loath mobile phones.

betty: what are they saying? richard: i started out to do a story about chefs hating mobile phones. each when i spoke to said they are ok. nobody uses them for conversations anymore it is all texting. they use more photos. social media is good for restaurants. a king of restaurants in new york saying he liked it. mark: what is the etiquette in fine dining restaurants? you speaky do not let on your mobile during your lunch. richard: if you tried, you get a look which means they will put it -- i do not recommend it. they accept photos. the chef said he takes photos and restaurants now. a really big change. there used to be a note on the menu not to use them but they kind of to some extent trust

people. mark: i like what the iv do if they see someone answering their mobile phone. what is their way of dealing with it. richard: they glare at them and hand them a piece of paper saying please take this call outside. it used to be banned especially photographs. the do not want people snapping. but now all the celebrities take pictures so they have to accept it. betty: do the chefs find it helps at all? i think richard does not have is your peace and. -- his earpiece in. mark: he can hear you now. betty: do the chefs feel like people posting on social media actually help traffic to the restaurant? richard: chefs are eager as much as any of us best chefs are egotists as much as anyone read they encourage us. you might try and take a picture but they don't mind as long as

you keep your flash on. mark: isn't dining about engaging with your partner in the restaurant itself? where has that gone? richard: i wonder. i get calls and texts and e-mails in this story about mobile phones so i hardly spoke to the person i was with. i did not look at my food that much. i think it is a shame people are other phones all the time but that is not the restaurant's problem. that is a life problem. you're probably texting on your first date. betty: i'm on my phone and i'm texting to richard right now. richard: i think i'm getting the message. mark: see you all tomorrow. have a good night. ♪

>> it is new ne noon in new york and 1:00 a.m. in hong kong. >> welcome to bloomberg markets.

alix: from bloomberg world headquarters in new york, i'm alix steel. david: i am david guerra. alix: janet yellen and company, will they acknowledge the turmoil threatens their upbeat view of the u.s. economy? david: facebook stock is down about 8% this year. last quarter results justifying the selloff? alix: is the united states rivaling switzerland? we will to you why the u.s. is becoming the goto place to stash wealth. david: let's head to the markets desk where julie hyman is back. volatility is over. julie: that is why, obviously. we have seen major averages come back