>> good afternoon everybody. tracy: here is what we are watching this hour. >> we start with the u.s. economy expanding in the fourth quarter war than previously thought. did a grow in the wrong places? there are still plenty of tools for china to stimulate growth. is evaluating the yuan one of them? >> chris christie coming out in support of donald trump. it raised how much of a boost before the candidates are ready for super tuesday? we are going to head over to the markets desk for julie has the latest study with a look at honeywell and united technologies. julie: ongoing. we just got headlines a few months ago from united

technologies again rejecting this offer from honeywell for $108 per share. honeywell shares are down about half a percent. it was halted ahead of this coming out and they have now resumed trading. they have taken a little bit of a leg down but not much change. this is the history of this. i made a quick chart of the past week for these two companies. honeywell is in green and united technology is an white. on monday there was a report by cnbc the two companies were in talks. they could not get anything done because there were concerns about regulatory hurdles, antitrust approval for the deal. than this morning we had a deal being made public from these two companies. the offer made public from honeywell for united technology for $108 per share. now united technologies says

there are regulatory hurdles that are significant. there are antitrust hurdles that are significant. and the offer grossly undervalues the company. that is the latest. we will keep you posted on if we now get another tally from honeywell and a higher offer. the fact we are not seeing a higher price from united technology implies investors don't necessarily think it will be a higher bid. we take a look at the major averages. they have been bouncing around all day. looks like it will be the tightest range this year for the major averages. we have had a late session breakout. that has not yet materialized today. for the month to date you look at some of the major averages and the action we have seen, the s&p has broken its two-month losing streak. the nasdaq, if you look at its performance on the month, is not quite there. is the worst performance --

performer of the three major averages. >> i don't look at the equity trade without looking at the energy trade. what are we seeing today? julie: if you look at oil prices, we have seen more of a consistent gainer. it has since turned lower. it's been bouncing around in today's session. you can see they are correlated on that level. natural gas as well. yesterday we saw it fall to its lowest since 1999. it is still at that kind of a level as we continue to see declines. the dollar has been gaining strength. that has been putting pressure on commodities after this morning's economic data coming up better than estimated. rounding out commodities, we have got to check on gold and copper. gold heading lower today as more of a risk to some extent trade and dollar strength. copper hanging onto gains because we had commentary at a

chinese officials that maybe we will see more stimulus. >> think he so much. let's check in the bloomberg first word news. mark: that he so much. as carol mentioned, a stunning development on the campaign trail. governor chris christie is endorsing donald trump for president. at a joint press conference in fort worth, texas, he said trump is the only candidate qualified to be president and the only one who can beat democrat hillary clinton. ofernor christie dropped out the race after a poor showing at the new hampshire primary earlier this month. the white house says in many for the vacancy on the u.s. supreme court. it will not be announced for tuesday when president obama will meet with the senate leadership. majority leader mitch mcconnell, chuck grassley, harry reid, and ranking member patrick leahy will all sit down with the president at the white house. gunman have forced the way into a hotel in the somali capital of

mogadishu. a bomber rammed his car into the syl hotel entrance and then gunmen enter the premises after an exchange of gunfire with hotel guards. early reports indicate three dead and 17 wounded. the hotel is located across in the presidential palace in mogadishu. the islamic extremist group a\ l-shabab claimed refunds ability. to record before the beatles hit stardom is going up for auction. .he 1962 recording was made it had been in the loft of a member of another liverpool band. the demo record is expected to bring in at least $14,000 next month. ♪ global news 24 hours a day powered by our 2400 journalists in more than 150 news bureaus around the world.

carol, tracy? leadersonths economic have been calling for better key medication for the people's bank of china. in shanghai the governor said "china still has some monetary policy space and will double instruments to address possible downside risk." >> here is what the president of the world bank had to say about china's offensive. >> i think what you are seeing today is a much more aggressive approach to communication. the central bank governor had a press conference today, during part of which he spoke in english. he is very good sign communicating directly inning was with the global market. >> joining us now is betty mendel from j.p. morgan asset management, which oversees $1.7 trillion.

talk to us about the market environment right now. we heard from china overnight. we all keep waiting to see what might be the next move. what do you expect out of china? >> by way of context, there have been a number of stresses in risk assets since the beginning of the year. one was definitely china. uncertainty about the currency is how they will manage matt -- manage that. an layered onto that you have concerns over u.s. growth. the oil price plunging. you have the fact that the fed was lifted off of zero and there is some nervousness that would constrain their flexibility going forward. when i think about all those factors that the markets are weighing, i feel most will end up being a femoral. china will not. in china you have a situation where -- >> we talk about china so much in the lack of transparency or

how they change policies from week to week. it feels a little bit more consistent. do you have an idea? >> i think it's fair to say they are struggling. the policy dimension to prop up more than trying to camp down a going economy. into symmetry that is new to them and they're trying to figure out how it works. i think about the deceleration of the economy. i think about policy is having reasonable ways and means to address that. they have fiscal policy, arrows they can fire, they have monetary policy space. they continue to cap reserve requirements. policy stance, you think that is relatively market neutral. but simmering under the surface are these other factors such as how to they manage the exchange rate? there is an extraordinary amount of uncertainty about how they will do that probably even from

their perspective. and you have the fact that the policy insurance they have been using to prop up the economy are somewhat anachronistic. spigot and credit devaluing the currency, that is the old business model. that is supporting credit-fueled investment and the internal sectors of the economy. a stable model is one in which consumption and domestic demand lead. it's a big turn. those will bubble up to the surface periodically over time and probably caused some hiccups in the markets like we saw last august and dramatically at the beginning of this year. >> i'm sure a lot of people would agree that the u.s. economic data looks good, but talking about the china risk what are the chances that china and's the u.s. economy down with it? >> you have to think about the channels by which they are uncertain about their management of the exchange rate and how it

transmits to the u.s.. it's fair to say direct channels through trader relatively small. thinking about the explosion of -- global economy, about 9% export to roughly 9% of the gdp the majority of that goes to developing markets rather than emerging markets. in emerging markets china is only less than 1%. roughly insulated in a direct sense when you want to be a little bit more concern is the fact that financial conditions reflect uncertainty in china had tightened dramatically every time you get a risk sentiment coming from china. >> it's important that the consumer keeps spending and providing support. what about the elections? our team put together a interesting chart and look at the vix and the amount of stories on bloomberg that have to do with donald trump. the white line is the trump story count. and the orange line is what

happens with the vix. people are nervous about what is to come in terms of the white house. or could be, maybe. >> you have to be careful about correlation and causation. that is a pretty tight fit between trump and volatility. should they make investors nervous? >> we get a lot of questions about is the fed going to be deterred from changing tack on policy in an election year. it's certainly in the case of -- theyi think there is will be fiercely independent of the political process. the fact it confuses some uncertainty into things is hard to get around generally. >> we have seen stocks come bouncing back up over the past couple of days. is that a sustainable rally? >> this is the key face we chase

as asset allocators. constructive, moderately constructive fundamental view which will continue to reassert itself. you see good data out of the u.s. think theso -- we conditions we have seen punctuating last year in the beginning of this year is going to continue to surface. ben mindel,el -- thank you for weighing in on the markets. >> as we head to a break there is a live shot of donald trump in fort worth, texas. about half an hour after getting that endorsement from governor chris christie of new jersey. you are watching bloomberg. >> if you look at what happened in california with the 14 people killed by two people that were radicalized, she probably radicalized him. how about this country?

we cannot even get the cell number. i like safety. i want security. when it comes to terrorists, we have got to knock them out. bigly.g,

♪ welcome back to bloomberg. west head to the market desperate julie has a check on some of the movers on this friday. go -- costco. same source sales remain softer against expectation. the stock was cut the neutral. resource says the comparable sales in january my been due to the super bowl shift

and less negative weather impacts. you see a little bit of an effect in february. to see the shares down by 3%. also, affecting clorox to neutral. this one over at stern agc. this has to do with valuation. however, the analysts say the could rise inck expense of birch. those shares down by 3%. into it -- intuit, came out with earnings of thes -- beat estimates. the shares are down 5%. there is someays concern about the company's cash flow. said there is some concern about it having a cash flow to cover that dividend increase. questions about their balance sheet as well. that is perhaps was -- what is

weighing on their shares. utilities are lower in treasury rates move higher. electric power trading over today. tracy: we are going to cut to a break. more bloomberg markets coming up next. ♪

♪ carol: welcome back to "bloomberg markets." after almost two years after the traders, nowded some idea of what really wrong. jpmorgan says the problem was something else. alexandra skaggs is your with the details. what are they saying? >> they are saying the move originated in the cash market, which is really interesting because it sort of shows how that market's trading changed. carol: is in it different to

what the government originally said about the flash rally? alexandra: they put up a whole report and they do not make any concrete conclusions. they just sort of -- we look at the futures market and at some of the cash market. it was 76 pages with no concrete decision or conclusion. he wanted to be very liquid and not have any quarks and it. alexandra: it is interesting that futures, if you're looking at futures trading, it is going a lot more smoothly than cash. tracy: we hear a lot of talk in the markets not a about liquidity. if the treasury market isn't liquid and people are worried about treasury market liquidity, what hope is there? alexandra: it gets to the question of what you mean by liquidity? if you went to buy or sell a treasury note, you can do that. you might end up moving the

price more than you want. you might have issues moving large sizes of trades. it shows the cash market -- there was a fed report out a while ago that says more than 60% of investors still use the phone. can this era of technology and things become so automated. alexandra: it shows the different paces in which the market is moving. carol: the regulatory environment cap -- kept up. alexandra: the question about what environment there is is a good one. the treasury is looking at it just now for the first time in almost two decades. they are taking a look and deciding what they even want to look at. at actualking regulation, there is not much to speak of. tracy: does this at any applications for the actual u.s. government debt funding profile? that is difficult to

tell because people love buying u.s. government debt. carol: good to get an update on this. alexandra skaggs from bloomberg news. let's turn now to the g-20 meeting in shanghai. we are concerned about china's slowing growth. bloomberg surveillance anchors talking with bob over at kissinger associates. they asked him what might be accomplished in shanghai. >> it will give the chinese a sense of how the rest of the world views what is going on there. i think that the mature policy makers in china, the finance minister, the governor of the central bank, will have an opportunity to explain in much greater depth to their fellow ministers and governors what is going on in china. what is the long-term view in china of where they are going. even ifclarify things, it will not produce your medical results. tom: this was a bloomberg

summary of g-20 real gdp. there is no question they gain over the decade. this successful gain. g-20 in pittsburgh with that optimism. i remember the london meeting with gordon brown. then it falls apart. are in g-20 economic recovery or is there still a fragility? >> i think there is a fragility. there is unlikely to be concerted effort by the g 20 countries. i think the imf's prodding them to do more. the fact that the chinese have announced they have more room on both monetary and fiscal policy is encouraging. on the other hand the people will be looking for whether to fund -- fundamental market reforms will continue to move in the right direction. tom: this is so important. yesterday they said there was no room for fiscal adjustment within germany. >> he is saying we have to stop doing so much.

when you to focus on structural reforms. they said that four or five years. when you look at the g-20, and we are looking at live pictures of a lot of these finance ministers coming together, bottom line, do we need an agreement on currencies and will he get it? >> i think a detailed agreement like the accord like some of speculated on will be very difficult. i think with monetary policy being less useful for most countries, and in many cases there is very little room for monetary policy and fiscal policy. for many countries it is the same way. for some countries the devaluation of the currency is the default stemless position since they cannot use monetary and fiscal policy as readily as in the past. the worry they all have is there could be competitor devaluations. i think it will be a major effort among them to talk through this and try to get some agreement. countries will not use exchange

rate the evaluation as a means of stimulating their economies or begging my neighbor or risking getting into a currency war. i think that's the risk. it depends largely on china, whether it will be stable. if it is relatively stable, and they have every interest in rmb, it caning encourage capital exports. if they do with they are planning to do, it will help stabilize things. francine: will be able to find an agreement or something that sticks? mark carney the latest one to warn against it. everyone is evaluating. the ecb. even possibly the u.k. it's china, it's japan. >> i think in the asian region people look at china because it is the biggest economy. if they allow their currency or the market to push their

currency down, other countries go down in order to avoid losing competitiveness. it is certainly not china's fault all this is happening. many countries are using currency devaluation for a variety of reasons to stimulate growth and exports, which in turn stimulates growth. every country has to avoid using the exchange rate as the way -- as the default position for similar to economy. china just happens to be the biggest. that was the vice chairman of kissinger associates this morning on bloomberg television. still ahead on "bloomberg ," one of the biggest corporations --"bloomberg markets," one of the biggest corporations is giving up the fight after the death of antonin scalia a.

tracy: let's start with the headlines on a very busy day.

we have bloomberg first word is with mark crumpton. mark: a very busy day indeed. chris christie endorsing donald trump for president. they are campaigning today in texas, one of 11 states holding primaries or caucuses on super tuesday. governor christie says mr. trump is the most qualified candidate. >> there is no one better prepared to provide america with the strong leadership that it needs at home and around the world that donald trump appeared the: he ended his bid for presidency earlier this month after a poor showing in new hampshire. hillary clinton has a three to one lead over bernie sanders in florida. mrs. clinton leads the vermont senator 59% to 33%. she also holds a commanding lead in south carolina which holds its democratic primaries tomorrow.

the pentagon is launching more cyber attacks against islamic state. the surge began surely after the defense department called on commanders to ramp up the fight against the militants. the pentagon says it will have teams -- gianni infantino is the new president vote.a after a the vote comes after soccer's governing body approved reforms aimed at ending corruption. u.s. and swiss authorities are still investigating fifa. global news 24 hours agape hour-by-hour 2400 journalists and more than 150 new spears around the world. daylobal news 24 hours a

powered by our 2400 journalists. three days before the firm approached united technologies with a purchase offer -- interesting timing. >> absolutely. if every 15, he sold the shares. bidebruary 19, they took a and on every 20 seconds when the 22nd ist's fit great when we got news -- on february 22 is when we got that news. does he have any position at all? >> that accounted for half the directly.held directly,res he held it was half. tracy: is it possible this was

done through a prearranged trading agreement or program? >> that was not disclosed in the filing that announced the sale. we asked for comment but they did not tell us that it was done through a prearranged sale plan . carol: honeywell and united this has been going on for a year, this back-and-forth. david cody is a smart man -- david cote is a smart man. you have to wonder what is behind it. >> we can trace the filings and the numbers but we do not know what went behind that or not. tracy: what do you think the next step in the saga is based on today's news? guess,uld hate to take a but we know he sold 36 million

and of the deal and acquired shares tend to go down upon announcing an acquisition offer. carol: we have to be very careful, but when folks see this kind of story, they often think that's will regulators be looking into insider trading here? told by a source that this is the sort of thing they might look into. they've looking similar situations before. carol: interesting. shares,uick look at utx they are down 1% here. the company is not saying anything? fore approached the company comment and they declined. carol: have we seen this before?

>> i certainly have not . carol: thank you so much. of dust one less case dow chemical's settling an antitrust case. "growingw saying political uncertainties due to recent events with the supreme court and increased likelihood for unfavorable outcomes for business involved in class action suits have changed our risk assessment of the situation. carol: fascinating. tell us the background we need to understand about antonin his past terms of rulings. >> he was one of the business friendly justices, particularly on class actions.

the last two significant class actions included walmart in 2011, he wrote a 5-4 decision limiting class actions and one involving comcast if years later. -- a few years later. without him, it will be hard for businesses to win those -- what is their attitude toward businesses going forward? the caseuld still make that without scalia it is still a friendly court. -- the fourals liberals are not that liberal on business. look at class actions and an , thisike arbitration could potentially make a real difference. if president obama or a democratic president gets to appoint the replacement for

justice glia -- justice scalia. for them to quickly wrap up this settlement despite having fought it in court for some time. >> has they said, things have changed at the supreme court. dow also has that merger out there with dupont. they have another reason in the background of making that clear that this is not something that will stand in their way with that merger. tracy: do you expect to see other companies follow suit? it isn't certainly possible or companies will make different decisions about how hard to press something in court. withinly in the short-term an eight member court come until justicewho is replacing scalia come it is a less favorable environment at the spring court for businesses. -- at the supreme court for businesses.

this could just be a short-term thing. we don't know how this whole tsonga will end. -- whole tsonga will and -- saga will end. tracy: have we heard anything about a successor? we've had governor brian sandoval of nevada, his name was run up the flagpole and came down quickly. josh earnest says it will be at least the middle of next week. soon.d not expect it to -- too soon. up, chrising christie's endorsement of donald trump is one of the real estate developers highest profile ones yet. carol: tim cook addressing the

iphone controversy with shareholders at their annual meeting. tracy: warren buffett is writing his annual letter to shareholders. what will he say about berkshire hathaway's poor performance last year? carol: marco rubio at a rally in oklahoma city. this is bloomberg markets. ♪

carol: welcome back to bloomberg markets. tracy: we want to turn to politics for a moment because chris christie is throwing his support behind donald trump. making the surprise endorsement at a trump event in

fort worth, texas this afternoon, calling him the best choice. >> america must have a strong leader again that can restore american jobs and restore american confidence and donald trump is just the man to do it. carol: joining us from charleston, john heilemann. are you surprised by this endorsement? >> i think the world is surprised by this endorsement. it did not leak, no one expected it, no one wrote about it. chris christie took his share of shots at donald trump while he was in the race. you kind of understand the logic in the sense that christie really has zero respect for marco rubio, took marco rubio on hard. christie's view has always been rs arehe first-term senator'

not up to the job of being president or taking on hillary clinton. question aboutf why he chose to overlook john kasich. christie and trump are very temperamentally similar, both brawlers. christie putting aside some that she may just look to trump and say this brawlers like me is the only one in the party that can beat hillary clinton. for the moment, we have to take him at his word. tracy: do we expect this endorsement to have much of an impact? >> think it will have a huge impact. rubio is trying to

consolidate the mainstream of the republican party and say we have to stop donald trump. all the establishment has to come to me. chris christie is a card-carrying member of the republican establishment. , northeastmoderate governor of new jersey. when he decides to not go with the rest of the establishment and back donald trump, that is a watershed moment in this race. with newhe phone jersey powerbrokers saying donald trump could beat hillary clinton. we have to get behind him. figure as big as christie to be making that argument for donald trump is a huge turning point in the race. carol: i can't help but feel chris christie does not want to go home into his day job. what do you make of the timing of this announcement coming right after that debate last night?

>> i think the timing is very good for donald trump. figure out some way to change the storyline after every debate. that's the masterful element of how he plays the media. he figures out a way to say to the media, that is not the story, this is the story. this is masterful in that regard and terrible news for marco rubio. because today was set up to be a day when all we were talking about was how marco rubio manned upde up to -- and took on donald trump. now, we're talking about how donald trump put marco rubio in his pace and got an

establishment endorsement. wayp trashed rubio in a that was really something to see. tracy: we have big events coming up tomorrow for democrats. what are we looking for there? >> the south carolina primaries tomorrow. an important primary after you come out of the early states. state that looks like a lot of democratic electorates. huge african-american vote, more than 50% of the electorate in 2008. for hillary clinton, that is good news. she has been here all week long toing to run up the score deal something that looks like a death blow to bernie sanders and say i will run up the score in

south carolina and get a huge portion of the african american vote. they will vote in super tuesday states on monday. -- on tuesday. is tos a sign of what come. that is her message. bernie sanders, knowing that, has spent most of his week out of the state looking towards the super tuesday states. going to oklahoma and missouri in minnesota and illinois. sandersa sign that knows he is in for a drumming here. the question is how bad it will be for bernie sanders tomorrow. is there some small chance that he will come closer to hillary clinton than people expect? was the crowd behind christy endorsing trump?

at a presse conference, i don't think anybody was blowing at the press conference. i don't know about the rally. carol: good to know. john heilemann, thank you so much. tracy: don't miss "with all due respect." we will have a preview of tomorrow's south carolina democratic primary. let's head over to the markets desk were julie hyman has the latest. julie: wanted to look at some movers we are watching. sun edison is one of them. rating --avorable ruling in a delaware court. this in regards to the billionaire's effort to block their acquisition of vivid solar -- vivint solar.

terraform power is trying to buy some assets -- now that this deal has been approved or not blocked by the delaware judge, we are seeing shares of both of those companies surge. there's still some lingering questions about sun edison's broader business prospects. shares having a very big day. having a big day, herbalife. companies thatse have come up against hedge fund magnets, in this case, bill ackman. he has called this eight pyramid scheme, has a billion dollars short bet against them. the've been in talks with ftc which might end up resolving the investigation. herbalife cautions that this could still have a material effect on the company depending on the outcome of these talks.

there's a lot of optimism surrounding that announcement. , those at jcpenney today shares rising after the company's profit and sales topping estimates, they are up by 15%. the ceo's attempt to turn around jcpenney are starting to bear some fruit. same-store sales up 4.1% for the quarter. we are also looking at craft kinds come another stock that has been gaining in the wake of earnings. heinz.kraft carol: coming up, silicon valley versus the government. the continuing battle over privacy. how this case will play out. this is bloomberg markets. ♪

tracy: we do have breaking news from credit squeeze. -- credit suisse. overhaul that is chief executive officer has been working on -- this is according to people with knowledge of the matter. we will continue to monitor that for you. a busy couple of weeks for apple and things do not appear to be slowing down. tim cook addressing the company's battle with the fbi and apple shareholders meeting earlier on this friday. us to talk about what it means for apple's legal fight is cory johnson. what happened at the meeting? y: the shareholder meetings are not usually much to write about. institutional shareholders are rarely at such events. given the news flow this week, it was an interesting one for tim cook to appear and appear he

did. he was asked about it and did in -- talkingis was about apple's first amendment issues here. he felt the issue of privacy was very important. m&a,so talked about falling share prices, falling nasdaq might be good for them and enable them to be some readers and acquisitions. this mergers and acquisitions. he told the audience that it was their right to oppose the government on this overreach, as he called it. any reactione seen to their legal filings so far? cory: silicon valley is backing apple in this.

last night, we had the ceo of chegg also saying that he supported him. had that apple absolutely to challenge the government on this. facebook, google, twitter, all these companies backing apple. that kind of support is only continuing. public opinion has slowly been moving to apple's side. as people have learned more about it, about 50%. how much of that legal filing -- i know you went through it all. is playing out in the court of public opinion? cory: it clear come assisting -- this is ament

legal document but was clearly written forcefully. carol: thank you so much. cory johnson with the latest on apple. check out "bloomberg west " right here on bloomberg tv for more on that. let's take another look at the markets which have turned negative on the s&p and doubt just a little bit -- nasdaq holding onto a slight gain there . the closes about 60 minutes away. is about 60 minutes away. ♪

,> is 3 p.m. in new york welcome to ne bloomberg markets.

scarlet: from bloomberg world headquarters in new york, good afternoon. i am scarlet fu. here is what we are watching. 28 between gains and losses on the final trading day of the week. oil heading to its highest level on the month. economic numbers paint a brighter number on the u.s. economy. gdp for the fourth quarter coming in ahead of estimates. hisen buffett will release annual letter tomorrow morning. what will warren buffett say about investing, what will you address and how will he address the slump in berkshire shares? first, we are about an hour away from the close of trading for the day in the week. stocks are mixed right now with the dow lower by 72 points. the s&p 500 down by