alyx: from bloomberg world headquarters in new york, good afternoon. here is what we're watching at this hour. stocks are mixed to start the trading week. the final week of the first quarter. . janetr stocks rise yellen will give remarks about the economy tomorrow as new numbers are out on personal income and spending. what clues will she give about the next rate hike? at pandora.eup ceo brian mcandrews is out. tim westergren returns to the top job. so far the move is not music to ears.street's for more on today's activity we want to head to the markets. julie hyman has the latest. on this extremely light volume day. julie: we do know it is vacation week for many kids out of school so that means some folks are away.

also, we have had a strong run of gains for the major averages. five straight weeks of gains. so now we are sort of hovering. there is a positive momentum as the s&p and dow gained slightly. the nasdaq down very slightly. if you look at the s&p 500 over the past week, it is not just today that we have seen this. there has not been that much of a change. down about 10 -- about 7/10 of a percent. even take a look at volume again today. if you look at the bloomberg, volume versus the 20 day average for all of the groups in the s&p 500. all of these bars are down particularly energy. more than 40% drop in volume. utilities, financials and health care seeing a 40% drop worse is the 20 day average. it is across the board. it is not -- it does not just feel like, it is lower than typical trading activity. alyx: is there a flight to safety in this light trading day or light across the board? julie: there is.

you would think with little activity in stocks there would be little activity elsewhere and that is true on a relative basis but if you look at gold it has come back from the lows. little change but you see this slow grind higher throughout the session. the treasury market, if you take a look at what is going on with the 10 year in particular, we are seeing buying as the yield drops down to 1.87%. the vicks is worth checking on to see if there is any activity. interestingly, even though there is very little change in stocks, you would think that the vixx would be down, it is a bite 4.4% today. alyx: julie hyman. let's get to first word news. mark crumpton has more. is planning trump to make his first campaign visit to wisconsin tuesday. senator ted cruz is positioning himself to win the state a week

from tomorrow. it will be the first primary since senator cruz begin collecting the backing of establishment republicans including jeb bush. 730 nine has delegates. senator cruz has 465. john kasich has 143. georgia governor nathan deal has vetoed a bill protecting opponents of same-sex marriage. a number of major companies have threatened to take their business elsewhere if that bill became law. intel, and disney, time warner. gay groups have filed suit against the carolina's new antidiscrimination law. critics say the law discriminate against transgendered people by requiring students to use bathrooms assigned to their biological sex. it also prevents local governments from extending protection covering sexual orientation and gender identity. federal appeals court judge merrick garland, president obama cost choice for the supreme court, is meeting with two more

senators today including joe donnelly of indiana and ben cardin of maryland. a meeting with illinois senator mark kirk, the first republican to sit down with judge garland. the senate leadership is refusing to consider judge garland's nomination saying the next president should choose a successor to the late justice antonin scalia. the supreme court has rejected an appeal by former illinois governor rod blagojevich in prison on corruption charges. tact hiseft in conviction. global news 24 hours a day powered by our 2400 journalists in more than 150 news bureaus around the world. i'm mark crumpton. alyx: thanksgiving so much. janet yellen is speaking at the economic club of new york tomorrow and many will be listening for clues as to whether the central bank will keep holding off on its next

rate increase. the latest data clouds the picture despite gains in the course he i -- the core cpi. tepid inflation growth. the gap between the two is .65%. michael for rowley joins us now from washington with more. what do you think is the tipping point to close that gap? hard to i think it is say. medical care inflation has been weak and that is one of the reasons the core price index has been running software then the core cpi. in terms of yellen tomorrow, she did speak a week and a half ago. was pretty dovish. since then we have gotten data that besides that cpi, generally on the soft side. a bad durables, weak consumer spending. i do not see a major region -- a major reason why the message should change. alyx: the difficulty with the gap is if we get some sort of

snap back in court pce and catches up the cpi, does that mean we are looking at a substantial overshoot of inflation from the fed target? michael: i'm not sure we are looking at an overshoot yet. yellen did make the point in her press conference a week ago, the latest cpi readings have a few factors that reflect some transitory noise. we had some low ones. recently had some high ones. we and the fed are still looking for core pc that remains low 2% even if some of that medical care inflation does pick up i would be surprised if we are above 2% on the court pc measure by year end. that is a risk for the fed. when you hear more hawkish members of the committee like john williams, they are concerned we could see some catch up and that could happen quicker than we expected. that is the risk they are taking.

alyx: when you have a look at the data and inflation today, the lumpy data of personal spending and the other data that has been relatively soft, does that mean some kind of victory lap for yellen or not so much? michael: i don't think you want to declare victory over soft it validated think some of her concerns which led her to be more cautious regarding rate hikes. i would suspect that relative to a week and a half ago, there is nothing that would make her -- not much that would make her less concerned about the trajectory of growth. after today, being marked down for the first quarter. does not feel like this great momentum heading into the second quarter. she probably -- those concerns of hers are validated. alyx: the other part that has been happening in the economy, port -- corporate profits down 11% in the fourth quarter. it is really down still over 7%. on the flipside you have the

unemployment rate holding steady. typically they tend to move relatively in tandem. do you think this gap can sustain itself? michael: i think what you are seeing in the process numbers is related to what is going on in the labor market. the labor market is tightening putting upward pressure on labor costs. it will make profit growth harder to come by. as you mentioned, there was the bp settlement. what is not transitory or probably more likely to be sustained is that with the labor market tightening, the pressure from high-yield labor cost will continue to pressure profits. alyx: do you think we have seen peak margins for companies? michael: probably. alyx: we have yellen tomorrow, friday the jobs report. what is the most important number in the jobs report considering that the fed has

made it known it looks at overseas data, inflation expectations, somehow more than other data. michael: i think for friday it is probably still the nonfarm payroll number. becausethat is partly we are sitting here at the tail end of what is setting up to be another disappointing quarter so i think there will be questions about the momentum of growth. of course, average hourly earnings has been a focus of the market in recent months for good reason. if i had to pick a number it would be that headline jobs number which tells you about the momentum of the economy. alyx: is there an argument that janet yellen wants a slower growth of employment? once the unemployment rate to stay at 4.95%? she had herhink if choice we would see those jobs numbers continue to come in 200000 and above. that being met with a rising participation rate. which is to some degree been

what she has seen in recent months. the best of all worlds. that kind of growth, more people in the job market, but you are not creating a lot of risk. i think what you've seen in the -- three toonths six months is what you would like to see continue. alyx: good to see you. eroli.l fo tomorrow, janet yellen will be speaking at the new york economic club on tuesday. you can follow her remarks. she will respond to questions from economist alan blinder and glenn hubbard. all of that coverage begins at noon on bloomberg tv. coming up, pandora cofounder tim westergren is returning to the job and shares are dropping on the news. we look into why the news is hitting a sour note with wall street. our banks poised for a rebound? be too beaten may

down to pass up. as we had to break, yields on the 10 year and the two year treasury bond. intoe seeing a movement the bonds today as yields continue to fall. 10 year yields, still close to 1.92%. definitely a comeback from the february low.

alyx: this is bloomberg markets. it's time for the bloomberg business flash. more trouble for valiant. michael pearson has received a subpoena from the senate special committee on aging. he is due to testify april 27 as

part of an investigation about rising drug prices are you the same committee that questioned executives from touring pharmaceuticals. beef is making a comeback. for the first time since 2006 americans will eat more red meat and they did in the previous year. agricultural department says the average american will eat little more than 54 pounds of beef, about half pound more than in 2015. beef has gotten cheaper, protein centric diets are becoming more popular. in california, lawmakers and labor unions have reached a tentative agreement to raise the mental wage from $10 to $15 per hour. that would make it the highest statewide minimum wage in the u.s. the minimum would not hit $15 until the year 2022. that is your business flash update. julie hyman has a check on some of the company movers today. .ulie: consumer and retail group that is doing well today on a relative basis. facebook and netflix.

$150rice target was raised at evercore isi. analysts saying facebook is poised to benefit from expanded messaging services and the importance of messaging applications. at the same time the information is reporting that facebook messenger is preparing in-store purchasing. those pieces of news kind of go together. netflix according to reports, if you look at its catalog of movies and shows we have seen a drop of about 30% over the past couple of years. .hat means a decrease in cost also the same report saying the company may further raise its pricing. shares are up better than 2.5%. getting into retail, dollar general is one of the best large-cap retail growth stories. though shares are up about 2.5%. came to this conclusion after seeing this and the company

areessed and says margins poised to stabilize or possibly expand in the coming years. also looking at other retailers. bloomberg intelligence is reporting the numbers are in for the first couple of weeks of march and that numbers were strengthening across retail. same-store sales up .4%. particular strength and children's apparel because of the timing of the easter holiday and also in sports apparel. we are getting lululemon's numbers after the close on wednesday. avon.k of the company cut itself into two parts, reached a settlement with investors. it will stave off a potential board fight and those shares are higher by 7% right now in the wake of that agreement. alyx: thanks so much, julie hyman. pandora is changing its tune

when it comes to who will lead the streaming media service. ryan mcandrews is leaving as the company ceo after 2.5 years. he will be replaced by tim westergren. pandora's stock has been singing the blues down over 50%. does westergren have what it takes to turn the beat up company against spotify and apple music? let's ask cory johnson who joins us now from san francisco. typically when we wind up seeing a shift in management at a beleaguered tech company that stock tends to rise. while we not seeing that today? corey: the plan was not working. plan this company had was not working. a big change. tim westermann was seen as a guy retired from the company. when he was ceo before the company went public, enormous crisis ease every few years. a big flight of talent out of the company.

the giant project they had catalog music in a new sort of way and compared that led by westergren himself, and musician, seen as tilting against windmills with this project. pandora was left with a legacy problem is still have not fixed. they pay so much more money for the content they put on pandora stations than competitors are paying. a competitive disadvantage and it is starting to affect them. last quarter the company was expected to make five cents per share, guided toward positive results and lost money in the quarter. havecrisis of pandora may emanated from the change in the stock prices. alyx: why bring him back? he has been through these crisis ease -- cory: he has been through these crisis is. a significant shareholder as well. perhaps they see him as the guy who can pick a direction, stick to it and lead them through. it raises a question of what could be a future.

what projects might the last ceo have spent a lot of money on that might require them to change course? they did reaffirm guidance but when you see the market reaction there's a question about whether or not they will be able to deliver. where the restructuring and so on might rear its ugly head. alyx: it seems like pandora has two strategies. still looking to find a buyer but it wants to quadruple sales. which one is arrested or in more apt -- is westergren more apt to take on? has beeniness growing his expertise. growth has slowed down. two years ago you had a company growing in size every year now growing at about 6% topline. that slowing growth to paraphrase warren buffett, you can see who is swimming naked when the tide goes out. you can see problems in the pandora business model. tim westergren is going to have to fight that on wall street

which he has not had a lot of experience with as well as making those changes internally. alyx: thanks so much. cory johnson a bloomberg news. still ahead, news of an alleged $95 million fraud scheme at pjt partners. we will have the latest details when we return. ♪

alyx: this is bloomberg markets. the managing director of pjt partners was arrested and charged with defrauding investors of more than $95 million. andrew casperson allegedly invented fake financiers come a set of false e-mail addresses and misleading domain names. shares are plunging on the news. take us through more of these accusations. >> this guy works for cartel

group, a part of pjt, working on the yahoo! deal. hedge funds and private equity firms. anywhere between 25 -- it adds up to $95 million that he potentially defrauded investors of. he set up a special purpose vehicle. pjt learned of missed doing's in mid-march and alerted the attorney general's office. he was fired this morning. when did this occur -- alyx: when did this occur? sonali: we are trying to find that out now. anywhere between october and now. he was hired in 2013. parkhill was still a part of blackstone and it is hard to understand if this is partially blackstone's problem or pjt's. blackstone is so much bigger. we are seeing pjt shares very much affected. alyx: what specifically is he

being accused of? sonali: he set up a special purpose vehicle called irving place. he set of a vehicle, false e-mail addresses. it is unclear where the money came from. he used it for his personal use. how no one really knew between then and now where the money was going, i am not -- it is not quite clear. alyx: is there any implication that there are others in this? sonali: right now, no. he is the only person involved in the fraud at parkhill group. pjt conducted an investigation and found it was isolated to him but a number of investors. alyx: do we know what the next steps will be? sonali: they are working with authorities. how much -- whether they will have to settle or not is a big deal right now. pjt had $400 million in revenue last year. . $95 million suit potentially

it is unclear whether they will have to deal with the settlements or whether this is a caspersen thing alone or if blackstone will be involved. alyx: what is the next step in the investigation? sonali: to really find out whether this was -- we did not know whether pjt will be involved in this or not. i would love to know who had invested in these funds and to what degree the investors were working with caspersen and how they are going to get the money ultimately back to investors. alyx: $95 million is definitely something. sonali: the new york attorney general's office and also the fcc are involved. -- the fec are involved. alyx: shares are plummeting so we will keep our eye on this story. thank you very much. sonali basak. a quick look at the chart of the

hour. i can pull it up in my terminal in just a second. let me get it for you guys. you can take a look at the bloomberg, the chart is called junk revival. western digital has a $5.6 billion bond offering. they believe the biggest of the year. part of the reason why is the rally in oil prices has in essence opened up the junk-bond market again allowing some of these guys to access it. so lera as well as charter communications. still ahead, had investors beaten out banking stocks too much? ♪

alix: from bloomberg world headquarters in new york, welcome back to bloomberg markets. i am alix steel. let's get to bloomberg first word news. mark crumpton has that from the

news desk. mark c.: police and belgium are asking for the public health -- 's help to identify to suspect. they have already identified the two bombers. meanwhile, the death toll of the attacks rose to 35 after two people died in the hospital. authorities are assessing prepare work at the airport before deciding when it will reopen. in syria, syrian troops have recaptured the ancient city of palmyra, famous for its ancient ruins. castro is weighing in on president obama's historic trip to cuba. it comes in the form of a long letter, recounting what the former leader sees as a history of u.s. aggression to cuba. letter wasrd

released by the state. new travel advisory for turkey . the high concrete threat is the second highest level israel can issue. it raised the level after three israeli tourists were killed in a suicide bombing earlier this month. global news 24 hours a day, powered by our 2400 urnalists in more than 150 news bureaus around the world. i am mark crumpton. thanks so much. banks really taking on the chin. the s&p index is about 6% down for the year. guest says that bank up.ks are too beat

what do you like? >> i think investors here are fighting the last war. not only are they scared of the slight economic downturn, but they remembered 2008. that is the opportunity. you have folks throwing out the baby with the bathwater. weldman sachs selling -- think you would buy those, hold them for 2-3 years, and make 50%-70% on your money, a good return. alix: it has been really ugly for banks. you look at citi, goldman sachs, morgan stanley -- everything bought him to about the february low. the s&p neutral on the year, but the bank stocks cannot seem to catch up. they are down for the year. it was described as a perfect storm, signaling out goldman

sachs and morgan stanley. >> you are right in the short-term. that is the opportunity. every investor knows, investor eratic.is very six months later, the tight changes. you would probably look for those groups that have flight, or have nothing -- but have nothing fundamentally wrong with them, like energy. here, you have a group, earnings may be down, but stocks are down -- in morgan stanley's case, 40%. the earnings will come through sooner or later. most important, we are not in a situation. alix: the question is bank they findity, and how that, not six-month, but 2-3 years down the road.

what you are not talking about is do they have enough capital? are they going out of business? these are the ways we had six years ago. these are the worries that investors are thinking about. all morgan stanley has take do is get back to tangible. belowthese guys have been tangible for a while. by using now -- >> not really. morgan stanley got to $41 per share last year, i think, august. all they have to do is return to , and there we will make 40% on our investments. what is the downside? of theey go to half value? i don't think so. again, we are long-term investment. i'm not saying there will be -- they will be a great stock two

months from now. alix: do you make at the station between u.s. banks and european banks? >> we sure do. we think u.s. banks fixed their problems pretty well from 2008-2009. european banks kicked their problems down the road. bond issues -- we are fortunate to not have those problems. would you be looking for less exposure to rising interest rates from the side, or doesn't really matter? >> i think you can play the ball down the middle of the fairway. you can combine goldman sachs, jp morgan, morgan stanley. i think you will do just fine with any of those. this is a rare opportunity, especially in the market, doing so well lately, to buy something cheap. alix: what would do it for you

to have the same opinion of european banks? >> i would have to see major restructuring, see what is on the balance sheet, and more transparency. alix: good to see you. up in the next 20 minutes of bloomberg markets, in today's global business report, we take a look at a japanese business giant. they are buying assets from dell for $3 billion. as we head to break, we will look at some of the biggest gainers today. marriott, starwood among them. ♪

alix: this is bloomberg markets. i am alix steel. stocks fluctuating today. the nasdaq is the only index and the red -- it just slipped into the green. let's head to the nasdaq where abigail doolittle has the latest. abigail: we do have some volatility around. as you mentioned, the nasdaq did just move into the green territory, boosting the index to day, i.t. research increasing its subscriber numbers. this is a bit of a flip for .nvestor corey barrett the numbers there could be at .isk plus, the possibility that

shares could move up on the olympics, of all things. alix: interesting. what is the drag? abigail: the biggest point track all day has been microsoft. the stock is down 1%. on the lack of any fundamental news. in tell is believed to take shares from apple at qualcomm. it pushes to move into the mobile space hard. also worry about profitability, as they try to sell modems to apple at a cheaper cost, as costs are rising. qualcomm is one of the worst-performing stocks in the nasdaq for 2015. it is about flat for the year. i am alix steel. this is your global business

report. here is what we're watching. japan may be looking for a fresh round of stimulus in coming months. the plan to supplement the bank's efforts is a done deal. dell plans to sell to ntt. foxconn may be ready to sign deal. we begin with japan. the prime minister may sign a -- front it stimulus heavy stimulus project. economist believe they will make a decision on another cells tax increase before may. much hasoblem is so been thrown at the economy for

summary decades to get on track, and even though we know it was originally to push the structural reform in particular, it could raise the female participation rate -- i doubt we see anything that makes them that excited about seeing that anytime soon. alix: dell is continuing its restructuring plan. it has agreed to sell to japan's ntt. ntt is paying a little more than $3 million. meanwhile, sharpen foxconn technology are looking to close their deal after months of delays. foxconn agreed to by the struggling japanese maker for $5 million. the takeover has been delayed. foxconn is likely to renegotiate the amount it will pay. clickow for a bloomberg take, where we provide context

and background on issues of interest. the 2016 nuclear summit kicking off in washington. north koreas plan to be on hydrogen bomb will the discussion. >> there are some things that north korea does not have. human rights, political freedoms, or enough food to feed its citizens. here is what north korea does have. i'm nuclear weapons program -- a nuclear weapons program. here's the situation. on january 6, 2016, a 5.1 magnitude earthquake was detected here. it was a result of north korea's fourth nuclear test in a decade. one nuclear experts are skeptical of the claim that it -- theed a hydrogen bomb

united nations and the u.s. once again responded to the threat with even more sanctions. sanctions.to dial up >> from kim il-sung to kim un,-il to kim jong-il north korea has been ruled by dictators since 1948, each deepening the country in isolation. the u.s. currently has 3500 troops stationed in south korea. here's the argument. this could all just be attacked -- a tact, but north korea has ofong history increasing hostilities, and then decreasing. it leads the u.s. and the world into a tricky situation.

most about my situations allow for a characteristic -- a care stickick -- carrot and approach, but in north korea, neither work. the most realistic option is stronger sanctions or the downfall of the kim dynasty. neither are ideal. that is your global business report. for more stories, visit bloomberg.com. u.s. banks may be a better shape in europe, but that is not saying much. christopher whalen joined the team earlier today. >> writing about the european central bank and their latest assets, itup of looks like they will start paying european banks to lend.

>> you have been great about writing about this a realness. i think people who defend banking have a respect for your work. with that, what this mario draghi have to say to get european banking to catch up to the instruction of american banking. >> it is the same problem that the fed has, to get the politicians and fiscal authorities in the game. the decision that angela merkel made to not restructure european banks is why the unemployment chart look so bad for europe. they did not have the political consensus to move forward with anything like the way we restructure the u.s. banking system. today, he is left is the only player on the field willing to do something. >> to the extent that the u.s. can do fiscal stimulus in any kind of way, for europe, it is almost impossible, right? the governments are barely

keeping it together to stay in power. >> that's right. , the than aig and citi industry cleaned up its own mess. the bond markets continue to function. european banks are trying to get the corporate debt markets back in some kind of shape so they can finance growth. they have a lot of bad debt on their books, at least what they admit to. >> i say this with respect to what europe has been through in the last two weeks -- you open your book with a definition of the american dream. is there a european dream? >> not yet. they have never had a cohesive vision. the whole european experiment has been about not having another war. tie them all together, and then we will not have another conflict. look at what is happening -- between immigration, the lack of growth, the rise of

populism. the donald trump's are all over europe. you can see them everywhere. it is driven by the same uneasiness -- -- het is your to do list has come out with broderick unchanging competition. if you change competition, you walk up the door. >> i think they have to get the bank operations back in some sort of order. they have to deemphasize the transactional derivative part of the business, and see if they makemake a banking work -- the banking work. it is the basic inking part that does not make money. they depend on capital markets swaps, things of that nature, and it has come back to bite them. everybody going to be in

rough times? at what point -- >> i don't think so. this goes back to the question keepingre central banks rates low, or negative. i think recently need to put in come back into the system, allowing me to borrow at zero. it is not a way to fix things. you need cash flow in the system again so they can have capital and buffer to clean up messes and move forward, and expand the balance sheet. >> is mario draghi doing exactly the right thing t? >> no. there are zero rates because there is no demand for credit. we need to get and come back into the system. >> and profitability. >> exactly. alix: that was chris whalen on bloomberg surveillance be a coming up, a great time to get

into infrastructure credit markets. we will discuss. also, some of the top active stocks today. ge, in particular, trading at its highest level since may 2008. so many people were tweeting about it, it triggered an alert. ♪

alix: this is bloomberg markets. i am alix steel. a structured credit becoming more attractive in today's markets? a senior profile manager seems to think so. on bloomberg , we asked him why he is so for best -- focused on structured credits. >> we think structured credits look fantastic, compared to other things. to be excited about anything wrong, but if you look at structured markets, which

include legacy subprime, commercial securities, and collateralized operations, they -- a lot of liquidations took place at the end of last year, so we see, it is very attractive to cost flow. they have very predictable power over how they will behave for the next 6-12 months, and also 3-5 years. be like an efficient markets and cash flows that we can predict. on a relative basis, we think that market looks attractive. alix: in capital letters, it begins with an l -- liquidity. when you look at structured credit and securities you are with thebout, possibility of more volatility through 2016, you see it being stronger? >> we think so.

the quiddity is one of the reasons why prices are as low as they are. you have a lot of people selling . the wall street dealer desks are no longer there. if a bystander steps down, another bystander has to step up. you're getting arguably cheap prices to take risks that are definable. and another bout of volatility, could prices go lower? of course. look at where equities are. they have rebounded. high-yield bonds are back to november levels. trust the market signals at all, it is saying that it has high-value now. alix: one market that has gotten totally wrecked is valeant. it is hard to avoid exposure there. how do you reconcile? we prefer other ceos that can

tolerate commodity losses. on the credit or equities side assume they will not default. ghey do have underlinein businesses. if they do default, the recovery level should be high. this is not a company that does not have revenue. this is an issue of corporate governance, bad pr, terrible practices with overbilling. have augh that you would bad recovery value. we think the fall probability is still low, but if it happens, the recovery will more than compensate for most of the leveraged loans. i want to bring in my , tracy alloway. you are a credit market geek. what do you think? of it makes sense.

we did see credit prices on a lot of structured credit file. what he is saying about the recession, if you don't think it is imminent, this is good value. it is true, there has been poor selling -- yes, yes. you can flip it on the other side. maybe for selling is not necessarily a chance to go bottom fishing. ?lix: who will be the buyers you need someone with deep pockets, with a long outlook, and what happens if there is shortselling again. there has been talk of structured credit not being suitable. , talkingwill be back about jim sweeney. stay with us for that. we will be right back. ♪

lexus 1 p.m. in new york, 6:00 a.m. in hong kong. welcome to "bloomberg markets."

♪ from bloomberg's world headquarters in new york, i'm david gura. consumer prices rising in february as consumers are men cautious about opening their wallets. what is driving the rally in crude? mostly short sellers liquidating positions. is that were oil is headed next? long-delayed shanghai disneyland is off to a great start. sold off in a matter of hours, disney has become a great presence in mainland china. the markets desk now, julie hyman has a look at the latest of the end of march. three months? holiday week for many. not much movement in the major averages. here you have the year-to-date numbers as well. because we are in part not

seeing much movement today. the s&p 500 down just lightly. the dow jones gaining three quarters of 1% on the year. the nasdaq remains alive heard -- remains the laggards for the year to date. upside,ownside and the telecom utilities and consumer staples, all gaining on the year . those other groups that are supporting the gains that there have been. health and financials stocks have been lower on the year. that has really been putting pressure on the major averages. a lot of strategists right now have been talking about how stocks are not going anywhere. one last week called it the bunny rabbit market as they look ahead to easter bouncing around but not going anywhere. bloombergk at the 687. this is a chart that we looked at last week, and it bears repeating as this has been a continued theme. the s&p 500, back to the , isnning of last year

virtually unchanged. this is as the economic data indeed has disappointed versus what economists have been estimating on a regular basis. this is the zero line for the citigroup economic index. it's economic data that has mystics -- estimates. some strategists saying that we will see an improvement on this. shouldmple of that, they spur better performance. david: what about the other assets, year to date? julie: we have talked about oil and gold going in opposite directions, recovering enough now year to date that it is up 6%. gold is still stronger as we have seen some concerns in global economic pictures. we will get more on gold in just a few moments. finally, the 10 year. taking a look there, as we have seen the yield go down to 1.7% as we have seen some buying of

treasuries this year. the irony here is that we continue to see rates moving lower as there is still anticipation that we will get at least one interest rate increase somewhere down the line. i use a much, julie hyman. mark crumpton has the first word news. mark: the georgia governor vetoed the religious exemption bill aimed at protecting same-sex marriage proponents. coca-cola and other big-name georgia companies joined the national football league and prominent hollywood figures in urging the governor to reject the legislation. suithile, they filed against the new north carolina antidiscrimination law, saying that it discriminates against transgender people, requiring students to use bathrooms assigned to their biological sex, preventing local governments from extending protection covering sexual orientation and gender identity.

the race now for the white house, bernie sanders has raised more than $4 million since sweeping caucuses in washington state, hawaii, and alaska on saturday. a campaign spokesman says that it is one of his largest intelection halls -- hauls the post primary season. in wisconsin mrs. clinton plans to address out donald trump would likely shape the court if he is elected president. she wants senate republicans to hold hearings on the supreme court nominee. judge merrick garland. ruth bader ginsburg plans to hit the stage the summer, making a cameo appearance in the production of shakespeare's merchant of venice. the noted theater lover will play, you guessed it, a judge.

global news, 24 hours per day powered by our 24 hours -- 2400 journalists in 150 news bureaus around the world. david: consumers are off to a slow start. while personal income picked up senior u.s. economist joins me with more. let's start with consumer spending, a slow but steady acceleration. >> it was in line with expectations in february, but it was revised down significantly in the month of january, which basically puts consumer spending on a slower path for the quarter as a whole, not an encouraging development. it clearly raises the bar for a fed hike in april. david: picking apart the numbers

a bit, i know that the savings were higher. pick this apart in terms of what this means in terms of what consumers are feeling right now. yelena: it is about whether consumers are ready to spend. clearly it is not such a great signal for consumer spending in the months ahead, in march. especially if income is not going to write. safe, butentiment is the income is not that great, so what are we going to spend? this is not such a great signal going forward. gas prices still low, relatively speaking. consumer spending that money. does data bear that out? seen it thatven't much, but consumers are spending. we are still seeing some growth. consumers might also be paying off their debts.

so, we will see. i think the most important thing is to see how income grows this quarter going forward. that is going to be the driving force behind consumer spending. in this respect the payroll report this week is really key to watch. david: let's look ahead to that and what you are expecting to come out of it. yelena: the overall number is important. the bloomberg consensus is looking for some think stronger. details will be important. especially income numbers. earnings in the average work week, this is something to watch closely, to see if the consumers will be the driving force behind growth this year. something that: didn't get enough attention last week, the market was closed, gdp numbers came out. yelena: two takeaways. growth was revised slightly as

it was driven by upward revision to consumer spending in both durable goods and services. probably a more important take away is that corporate profits showed another decline. worrying.nd of it's a warning signal for the policymakers, the economy might not be able to sustain too much tightening this year. have: lastly, you and i spoken about housing a number of times in the last few weeks. ending home sells came out. a bright spot, better than surveyed. what does that tell us about the state of the economy writ large? people talking about recession less, it seems like. housing has been held up as an example of what's been going right. yelena: i think that housing the hold steady as we have seen the same moderate growth this year. the numbers earlier this year in housing showed us some volatility. which is kind of ok to see during the winter months.

going into the spring season, though, we focused a good rebound on pending home sales, which is an encouraging sign that existing home sales might be on a stronger footing going forward. david: leading indicator there. .q so much, yelena tomorrow -- thank you so much, yelena. janet yellen will be responding to questions from the columbia business school. live coverage begins at noon right here on bloomberg television. coming up in the next 10 minutes, the price the process copper in china has fallen to a record low. we will tell you why. and we will hear from the indian prime minister, fighting back against critics who say that the companies -- country's economic growth is only due to the cross -- crash in global oil prices. 1.5 percent,ling raining on course for the best month overall since october of 2013.

this is "bloomberg markets." time for the bloomberg business flash and a look of the biggest stories in the news right now. mike mcpherson received a subpoena from the senate special committee on aging as part of an investigation about rising bread prices. no other witnesses have been announced. this will be the hearings -- the third committee hearing since the stepping down of the replacement seat -- replacement ceo. a revised takeover for starwood but by end bank, the new offer is valued at $14 billion. last week they accepted a revised $13.6 billion takeover

bid from marriott. brian mccann drews is leaving the company with tim westergren returning as ceo. the changes effective immediately. people with knowledge of the matter said that they are working with morgan stanley to reach out to potential buyers. management trying to quadruple sales, more than $4 billion by 2020. time for a bulletin now, at the markets desk belichick on the movers on the market. at gold ining particular, i mentioned it in the last block today. however today it is can of muddling along, down one quarter of 1%. looks like gold traders, folks who trade options in particular are not optimistic that we will continue to see the run that gold has been on so far this year. if you take a look at the may options, we $1245 have seen a big decline over the last week. the one-year chart, if you look

here you can see the drop we have seen in those options as investors are betting that we will not continue to see gains from gold prices. the economic data that we got recently, including the gdp revision on friday, is not giving much fodder to gold as a refuge trade, right? a trade against the concerns of economic growth in the united states. if you look at gold prices in the last month, you will see that the run that gold has been on has come to a halt. it is down about 1% over the past month or so. at the same time if you look at holdings in gold funds, there is an index that we have that tracks that. you will see that we have seen some holdings go up as the price of those -- of the gold falls. we have continued to see investors invest in gold. the next thing to watch this week, janet yellen will be the federalorrow, reserve chair will be speaking

at an event hosted by the economic club of new york with more information that could inform gold prices and the markets in general. of course, we will have more on that. julie hyman with of metal balloon. thank you so much. the processed copper war in china dropped to the lowest in the year as chinese imports of or an unrefined copper fell by the most since last april. declining if there is a shortage of oil in china, i want to bring joad go. for those of us that don't know metals that well, what kind of process does copper have to go through? refinement.nt and in other words, china is often buying or deposits that they have to have refined into a refined metal, right? data, we've our own seen these rtc's falling off with a bit of a shortage and supply coming from -- coming from abroad into china where

processing fees go down when you see if shortage. essentially because the people that process it want to make sure that they are keeping their processing facilities as of monday as possible. so that when there is a shortage, they will pay less. david: i recall reading recently that a lot of people think that there is a lot of stockpiling of copper going on? joe: there has been so much movement and this has been an interesting part of the discussion. really what people have been watching is the stockpiles pulling out of the london metal exchange, going into shanghai. the question is, what is actually going on there? people are actually trying to figure out what it might mean. it does not necessarily mean that this copper is disappearing and that there is certainly a huge demand. right now the supply deficit forecast, the balance that many analysts are calling for out

there, surplus, global surplus, going to 2020. honing in on china, a bit of good news. are we starting to see any changes that would affect the copper market? obviously they are keeping an eye on what goes on day today. we saw a pretty good number coming out of china with pending home sales as well. long-termf the outlook, not many analysts that we are speaking with now say they are extremely bullish, but certainly if you start to see better numbers coming out of china, that's always going to be positive considering that china is a consumer of half of the world's copper. rio tinto, is that a forecast question mark this something that can cut back much more? joe: we just put out a chart today showing that the new projects coming online, survey

of 45 new projects show that the cost of production for those new projects is about $1.40. suggesting that you would continue to get more production companies,of these which i'm not necessarily sure helps on the supply deficit. the question of how far they can cut? if it's at a dollar and $.40? they could continue to produce for a while, i suppose. thank you. still ahead, diving deeper into the march jobs report and what it could mean for the next fed policy movement. coming up.

david: this is "bloomberg markets." we have a quick check in the markets, looking at the major indexes. 1%,dow, s&p 500, up 1/10 of

three points at 1039. the nasdaq is pretty much even. this week is chock-full of economic data, including the monthly jobs were. how will it play to the possibility of a fed hike? >> we are bringing him in in just a moment. --are -- david, this is thank you so much. jason is with us. ,is book out, recession proof it is doing really well on amazon. it's funny, corey and i talked about this, at the beginning of the year peoe were talking about recession and a kind of went away, but you say it's coming. jason: we think that there is a .igh risk of recession carol: is it because it is long overdue at this point or what? jason: you have some risks that there has been an over extension of credit to oil and gas. this was red flagged last

november. look at the manufacturing data. u.s. manufacturing has been in contraction for the last five months. industrial production year-over-year has been negative. the last than that happened was in, immediately before or after a recession in 1952. this is a problem and you are looking at some of that data and there is risk for financial services, posing a potential risk to the whole economy. david: there's a suggestion that manufacturing has gotten better. what do you make of that? jason: that's right. the dallas fed report came out, you seen a lot of different improvements. the question is -- is this the exception or the new trend? given what has gone on for so many months and the concern in the marketplace, from a corporate strategy standpoint you are still hearing the fed talk rate hike game. meaning that the weaker dollar that we saw last month or this

month in march that may have been bolstering manufacturing, it could quickly go away and we are suddenly back in it. we have talked a lot about how the consumers holding up the economy at this point. you started talking about auto sales and how that's been really propping up that consumer spending overall outlook. is that true? ha experiences and restaurants? we see a lot of spending on that. be the case, but isail spending on autos lower than any time during the 2001 recession. you've got retail cap recession levels. what happens as the credit cycle kicks in, as you hear people in financial services liking to say -- you see a constriction of credit with subprime auto loans getting reduced and suddenly you have least fleets coming back in

in the middle of the year with auto sales down. that's the only thing that's been propping up retail sales to keep the level stable from a year-over-year change. you see a reduction on auto sales and in a reduction to access for subprime autos it will weigh on the consumer spending component of gdp. >> there was a quote out a few months back about the duration of those loans and leases, that they should be extended to unheard of numbers, for the average lease tends to be up to 72 months and beyond. people will be driving these cars long after they become clunkers. that'sthat -- jason: right. this is one of those red flags that already out there. a warning from the occ and fdic about leveraged lending and oil and gas is part of the share national credit review. the warning signs are very clear. they put them out there.

what's really disconcerting to me is -- and the fed was part of shared national credit review, you have seen no mention in any fed statement since the issue was warranted about the recession going on in the u.s. or the industrial recession. even if we do see a bump in the month of march, where we do expect it to be about 50, it could still just be a dead cat bounce because of seasonal factors. what about the housing market? we do still see some -- support there. that doesn't give you some optimism? jason: the level we are at right now is more equivalent to the trough of the recycle since 1950, chapter 2001. we are still at recession levels for housing starts. this ayou were calling

sleepy monday, but not according to jason. seconds -- 10 seconds left, when does this happen? a modest recession, 1.5% for the year. jason, thank you so much. his book is high up on the amazon list, it's called "recession proof." david: a reminder, tomorrow janet yellen speaks to the new york economic club, responding to questions. live coverage the ends at noon right here. still ahead, don't call it a twist of fate. narendra modi tells us what he thinks is fueling india's success story. ♪

from bloomberg's world headquarters in new york, you are watching "bloomberg markets." mark crumpton has our

first world news -- first word news at the news desk. mark: police are asking for help in identifying a suspect seen of theo suicide bombers brussels airport. authorities posted surveillance video of the suspect on the police website and they have already identified the two brothers. meanwhile the death toll from the attacks rose to 35 after four people died in the hospital. making abefore decision on when the airport reopened. a suicide bombing in pakistan appears to have targeted christians celebrating easter. the attack at a park killed 72 people. 300 others were wounded. an offshoot of the talib and says they are responsible. the pakistani prime minister has called for a united fight against terrorism. nigerian soldiers have rescued 54 people reportedly held hostage by boko harrumph militants. haram is in its

seventh year of a violent campaign to impose violent sharia law on the most populous nation in africa. the chinese president was welcomed at the start of a three-day visit to the czech republic. talks were held at the country's seat west of prague. it is the first time a chinese president has visited the european nation and 67 years. global news, 24 hours per day, powered by our 2400 journalists in 150 news bureaus around the world. global oil costs are helping to curb inflation in india's to dollar trillion economy. -- $2 trillion economy. not just luck is driving the success. in new delhi they have a discussion they are host -- they are hosting a discussion.

>> india is one of the world economy's brightest spots. inflation. a low balance of payments. and a high rate of growth. this is the region of good policy. not good fortune. let me elaborate. between 2008 and 2009, crude oil fell deeply from a peak than $50. less this was a steeper fall in

between 2014 and 2015. 2009-10, the indian and inflation rate was substantially worse. line, with higher rates bigger for all three. 2016, all three have improved from our lower base. economies emerging also depend on imported oil. prices are the driver of woulds, those countries

be showing similar results. but they are not. we have not been lucky. with global trade or growth. us in termst helped of export stimulus. we have not been lucky with monsoons, our weather. 2015 have both had droughts. by droughts were compounded hell storms. production has remained much lower and inflation much than in the lost comparable -- last comparable drought year.

for india to be at the top of is an growth tables unusual situation. obviously there are some who find that difficult to digest and come up with an imaginative and facts.l idea fact is that indian economic success is the hard-won result of prudence, sound policy, and effective management. that was our exclusive conversation with the indian prime minister, narendra modi.

what is driving the rally in oil prices? might be all about the short seller. we will explain. plus the first disney foray into mainland china off to a bank -- off to a big start. of things to come? a look at media stocks today, including disney, time warner, and comcast. more after the break. ♪

david: david time for the bloomg business splash. the managing director of pj t partners, convicted of

defrauding investors. prosecutors say that andrew casperson stole money from sony private equity investments and alleged that he lost millions in options trading. he was fired for cause on monday. revlon has turned to a veteran to revamp the cosmetics company, saying the garcia will be the next ceo with their chief operating officer for global innovation and growth. in january the group that owns 37% of revlon said that they were considering strategic alternatives for the business. janet yellen will speak tomorrow in an event hosted by the economic love of new york, stating that she will respond to questions by alan blinder and glenn hubbard. we will have live coverage of the speech at noon, right here on bloomberg television, bloomberg radio, and bloomberg.com. your business flash update. let's go back to the markets desk.

looking at the winners in today's session, since we just passed easter, let's talk about banks. coming out with earnings ahead of estimates, shares surging by 9%. sales beating estimates coming in at nearly $450 million. average feet cost per dozen eggs was down 5% euro or year while prices rose.ng they have still fallen over the past several years, but year-over-year still higher. the ceo sounding a cautious note , saying that a inventories continue to build with market prices remaining volatile till the industry has more clarity on future supply levels. we are also getting more from the ftc trial involving staples and office depot as they try to delay the deal between these two companies so that they can be further reviewed. but there have been some setbacks during the trial. in the latest according to our bloomberg intelligence analysts,

basically the retailers are making a so far relatively successful case that there is competition in the market from the likes of amazon and others. setbacks have affected the credibility of the case. these stocks rallied last week and continue to rally. we are also taking a look at the finish line, with the company coming up with earnings last week and analysts weighing in today. including karina friedman, who raised the stock to a by and said that sales came in better than estimated, even with continued supply chain headwinds. there is also positive commentary coming out from the new ceo of the company perhaps being too pessimistic or conservative with the forecast for fiscal 2017, saying the fourth quarter was a good first that for the company with it bringing stability back to the business and all of that contributing to the 13% surge we are seeing today in trading.

interestingly enough, bloomberg intelligence today said that the first two weeks of march with comparable sales for all of retail, numbers looking good for sporting goods retail. thank you so much, julie hyman. ofde is up 50% in february 2011, but enthusiasts are opting to sit out on this rally. joining us to explain why, our bloomberg investigative reporter on energy. talk to me about how people are betting and why this is so surprising. >> the bulls are nowhere to be found. when you look at commodity trading advisors, bullish bets are down. in the meantime you have a huge short covering rally a record number of shorts bought back as people thought that that would -- it would fall. it is a longer run than we have seen in the past on this scale. david: what does this tell us

about the psychology of what they are thinking? >> that they were either cashing out because oil went as far as they thought it was going to go it tells us that some people got .cared out of those shorts that does not seem to be a lot of conviction by money managers that this is going to last. they are not putting her money on the line that we have seen yet. david: that is indeed a parlor game for many as to whether they are starting to pick up. is this shedding a on what the majority of people think about that? >> if they are keeping money in their pockets, that tells you a bit about what they are thinking. there are many elements of uncertainty here. elements, talking

about the freeze. is it hard to price and what that might do? >> it's an extract or with the degree to which people are , freezingicing it in production at what is already a record high rate in iran. the question of how much real impact that will have is debatable psychologically. just about a week ago we had the head of the international energy agency talking about how a lot of this is to blame with too much u.s. supply. in light of that when there is talk of a freeze, how likely is that to do much of the problem here is as people see it resting in the u.s.? >> you seen the production go down after years of record growth, partly because the natural decline will rates of the wells take over, they start

to raise themselves out without a lot of new drilling. it's a very high cost boom and they are running out of money. you are seeing them more and more up against the ropes in terms of missing interest payments. without money to drill driving the growth in production you can expect to see no activity picking up in the u.s. anytime soon unless prices really go back up and stay back up. david: going back to the , -- beginning, what has been selling? >> only two other times have we seen a seven-week consecutive run of shorts covering their bets. the nearest one is sort of half the size of this one, kind of telling you something. during the seven weeks you also saw a rally in prices. differing types and on one of

them you saw a crash back down and another when you didn't. much, thank you so asjyly. chinese themee park tickets sold out? the answer may surprise you. disney shares down more than 7%. more coming up after the break.

you are looking at pictures here john kasich at a rally in west salem, wisconsin. the next chapter in the presidential campaign is in wisconsin. primaries there in april. you can watch more if you want on the bloomberg.

today with late trading on low volume. looking at the nasdaq, pretty much unchanged. 1% atp 500 is up 2/10 of three points. the dow jones is up about one quarter. where should you place your money? earlier jonathan golf joined bloomberg and he said focus on stable growers. jonathan: we are adding 200,000 per month, which is what we are expecting for friday. companies are growing revenues more than their expense base. why? they have large fixed overheads. as we continue to not be in a recessionary environment, they continue to take their picks overhead and spread it over more units of sales. back? jonathan:

it's not huge and it's just not a disaster. in that environment if companies can squeeze a bit more out of margin and buy back 1.5% shares in get something like a 6.5% an eps environment on an economy that is really uninspiring. that is enough to fuel this thing to keep going. that is really what we have. again, just winners and losers. i would not be a value investor if i had a choice. latest notet your in what you said to put her money in, there are opportunities here. you say to focus on secular growth and stable growers. so, secular being what? biotech? david: companies driven by some -- jonathan: companies driven by some kind of intellectual property, things related to the court -- to the cloud. stable growers are companies that are boring, mid to low growth with a lot of visibility

and less volatility. we are talking about fewer consumer staples brands. a number of insurance companies are on the list. defense contractors. the guys who haul waste, waste management companies. those kinds of names continue to grow and they don't need a good economy to be able to grow, they simply need a good economy that isn't moving in reverse, which is where we are. well, it is the hottest ticket in town, the new theme park in disney shanghai selling of hours after going on sale at midnight. the first park in mainland china , three times the size of hong kong disneyland. 50 million visitors expected to walk through the gates. that's paul sweeney from bloomberg intelligence joining us now. paul, what does disney have planned? we hear a lot about the surging middle class in china looking to travel the massively and abroad. give us a sense of what they

want to get out of this park. paul: this is a huge investment on the part of disney. several billion dollars in capital. they say that this is as important as it was to open up disney world a generation ago. it is of course a play on the growing, burgeoning middle last in china. increasing the disposable income . disney has certainly been there with their films in the past, but it has not been there with resorts that have historically been a great business for disney. one could argue with statistics that no one does the resort business better than disney. china is a place they have to be. dare i invoked: euro disney? that was a while back. what has disney learned in terms of building the theme parks? paul: i think that one of the biggest things that they learned

from paris by their own admission was -- keep it local. keep local characters, local traditions, local customs. it's not just importing orlando to paris. it's really -- try to take advantage of some of the unique attributes of the local community and local customs. it's a difficult balance, one that they were much more tuned to this time around. talk about how integral the theme park business is to model.usiness getting people to go to movies, theme parks, rides and things based on those. paul: historically no one has done that better, to expand or extend the brand or character. they have done it time and time again. they certainly are going to do it coming up of all the marvel characters. with the frozen story that has

been such a success for them. they have done it consistently better than anyone else and this is a big part of it as they have made some very big investments in their film business. billions of dollars in pixar, marvel, and lucas films. it's not just about the films by themselves, though they have all been extraordinarily successful films, but extending it to their parks, resorts, and television properties as well. we saw the governor of ofrgia veto a piece legislation that a lot of companies, including disney, called discriminatory. let's listen to what he had to say when he vetoed that legislation this morning. >> our people every day work side-by-side without regard to the color of their skin of their fellow mate. or the religion of their coworker might adhere to. they are simply trying to make

life better for themselves, their families, and their communities. that is the character of georgia. intend to do my part to keep it that way. you cover a lot of media companies. disney was among those pushing for this veto of the legislation. describe the pressure the governor was under here. almost all the large media companies came out and put pressure on the governor to get rid of this bill. they have established themselves as a big film and television production location outside southern california. i have been very progressive andt giving tax incentives they have been very successful for all parties involved. i think that that's a business at certainly the media companies want to preserve, preserve that relationship.

i think that again that allowed them to really apply some meaningful pressure to the governor. david: a lot of ceo's are speaking out on issues like this . using their platform across the country in states dealing with laws like this. certainly for some of the larger companies across the world, they have to be sensitive to their workforce, the business condition, and what they believe is good business for their business. david: all right, paul, thank you. janet yellen speaking at the new york economic club tomorrow and addressg remark she was questions from alan blinder. don't miss our coverage right here on bloomberg tv and bloomberg radio. ♪

david: it is 2:00 in new york, 7:00 p.m. in london. reporter: welcome to "bloomberg markets." ♪

david: from bloomberg world headquarters in new york, good afternoon. lisa: here is that we are watching this hour. david: u.s. stocks are fluctuating as the dollar continues to rally against the yen. but taking on higher interest rates could actually be true. lisa: pandora makes management changes at the top while he considers its future. the name to the cofounder as chief executive. investors do not like what they hear. david: why the largest rough diamond producer is seeing a glimmer of hope despite a rough global economy. let's go to the market desk with the julie hyman. julie: we are looking at the market that is not moving very much. volume is down sharply versus the 20 day and 100 day