david: welcome to bloomberg market. ♪ good afternoon. federal open market committee meets tomorrow morning. her economic growth outlook changed. plan unveiled the on oil. we will speak about what it means for the economy. some forecasting iphone sales to drop. julie hyman has the latest. down one third of 1% across the board. investorsing a lot of waiting for the fed to come out

later in the week. average is down about the same percentage this point. we have not seen the pressure on -- today.s a gay it is closed the lowest of the session. materials as well at into the commodities led selloff. telecom a little bit better today. after saudi arabia said there would be a completion of the expansion of one of his oil spills by the end of may. that would bring more supply to market or at least not disrupt the already existing production in the reduction rate in saudi arabia. down 2.2% right now for oil prices. one of the other things continues to be earning spare we are looking at xerox out with earnings today that missed estimates. those shares are plunging 12%. kkr missing estimates as well.

first data, the payments process are coming out with earnings that beat estimates. are higher. missing estimates in part because of its stake in first data. the shares have not performed well since the ipo. on the been tracking ea bloomberg earnings analysis. right now, looking for 134 of the 500 companies within the index that have reported them. as we take a look at what we have seen thus far for earnings and sales, holding pretty steady . still he decline of .6%. earnings per share down about 8%. we still have a long way to go with these earnings numbers. i can only imagine when gathered around the table beorrow, one thing they will look at is the weak dollar in today'session.

>> right. that is something a lot of investors have been talking about playing to earnings season. still talking about the currencies. here is the board of the euro gaining today. the pound is gaining as once again, the key to u.k. in the eurozone. investors are weighing the bank of japan potential action later this week as well. we are watching the dollar index, as we have been. we see a lot more investors get short on the u.s. dollar. down 1/10 of 1%. take a look, you can find this on mi chart. this is the hedge funds it short on the dollar for the first time in almost two years. here, you see we just crossed over into that. not only have they been bearish, but this indicates perhaps a level of future harish this as well.

well.rish as david: mark crumpton has more. mark: donald trump needs another track to to stay on become president. mr. trump can only afford to lose one. there are a total of 172 delegates up for grabs. if he can win pennsylvania, maryland, connecticut, and delaware, he could walk away with 92 delegates. withs in to the contest 845 delegates. . president obama made it official he sent more troops to help fight the islamic state. the president spoke after visiting a trade fair in germany. obama: a small number of operational forces are already on the ground in the area.

given this success, i approved the deployment of up to 250 ,dditional personnel in syria including special forces, to keep up this momentum. the cold-blooded murder of canadian hostage of terrorists in the philippines. 68-year-old john wrist tale of calgary alberta is one of quattro tour is kidnapped last september, who head threatened to kill one of the hostages if a large ransom was not paid by today. a deli -- a day of rally seven n.c. state house began with the delivery of petitions signed by 185,000 people. law that for debt entails protections for the lgbt community p or 200 people gathered on the grounds of the old capitol building in raleigh to hear speakers denounce house

bill to or hp two. he then carried 200 dozen cardboard boxes signatures into the capital delivered to the governor. in more than 150 news bureaus around the world. david, back to you. is in retreat 500 today but the index is still well above february lows. is this a bear market rally or the start of another bull run for stocks? my first guest was predicting the loss for the s&p dow, paul ramsey's chief investment officer joins me live from minneapolis. let me ask you, what led you to change or call here? >> i think it is a high risk market. the fact is, the internal strength of the rally that has

carried on for 2.5 months is carried just far enough and has exhibited leadership that is really inconsistent with a bear market rally. anything could happen. in the last two weeks, we have seen a broadening out for the high data groups. whichand brokerage firms have been lagging badly throughout the rally, have finally broken out. at an internal statistics. you had 73% of stocks in the new york stock exchange trading above the 30 week moving average. almost a figure that never occurs in the contest of a cyclical fair market. i still think this is probably a better fort speculators than investors. i say that primarily because of where valuations are. the s&p 500 trailing 12 months of earnings or about 8650. that puts the s&p here at 2080 and 24 times trailing earnings.

yes, earningsn is on the s&p are down but they're not really depressed. obviously, energy and materials margins in earnings have been down, but margins for the entire s&p are still historically quite high. it is actually a pretty good one. we think stocks are still quite expensive. >> your flying by her instruments now. how has your portfolio changed since you were last on the show? have got a lot of latitude in the two tactical funds to shift equity exposure between 30% and 70%. the major trend index, i alluded to find by the instruments, that is one of the instruments, it is now mildly bullish. when that is the configuration,

we must be at least 50% equity. we are at 54%. between 50 and 70. it is a powerful enough move that we should expect to see new highs on the s&p industrials. on the s&p looking for maybe a soft spot where we start later thisleadership year. change.to respect a we do track a couple of

indicators. is too high. in terms of the earnings impact, i think it is greatly overrated. i think it is also greatly overrated in terms of stock market leadership here at a lot of people will say, a weaker dollar, they will tend to favor the large cap multinationals relative to the small. one of the greatest -- greatest runs of all time in the late 1990's were the dollar is very strong. a lot of times, perceived economic impacts of a stronger or weaker in this case dollar can be overstated on market action. that is our belief. >> how is oil? we are seeing energy down on the s&p. setting the table -- setting the table today. how big of a weight is that, still? >> we think oil has bottomed.

the cyclical low in oil has bottomed. some may say we're stepping to a pullback. and not just oil. thee is a lot to say commodities have been one by one. industrial commodities started a bottom earlier than the stock market. it looks like it is for real. there is still a lot of that is a pretty good sign from a contrary in perspective. a lot of industry groups work has started to confirm the move in part -- in prices. we have not yet bought any groups and we refer to the models there. i think you probably will later in the year. in oil, 55 or $60 as a negative to the stock market by any means. david: thank you very much, doug. coming up, saudi arabia and

prepares for life be on oil. the plans to grow its economy appeared as we had to break, a look at the biggest leaders and laggards, white t-mobile shares are at the highest level since october. later, a big week for central banks. the fed and bank of japan announcing rate decisions. will they be enough to stave off global inflation? ♪

david: a major turning point for saudi arabia today as the kingdom unveils a blue stream for diversifying the country's economy. mohammed won't depend on

excessive governing and the can and will press ahead. the news sent stocks up the most in seven weeks. now is a former u.s. ambassador in saudi arabia and he joins me from washington. just to react to the proposal, how big a deal this is, how radically changes being proposed? >> it is radical but you have to understand this has been many years in the planning. when i was there in 2013, i knew that he started to put together a team of consultants to plan for what his brain would be. . , sopublic sector economy even though the oil prices had accelerated the need for change, the understanding of that was a parent many years ago and the

work of three to four years of work moving toward the development of a private sector economy. the man whous about celebrated the plan and proposes implementing it here? old, noted, 30 years the youngest son, but actively and i firstbusiness met him in 2011 when his father , in ae governor of riyadh -- he had many mentors in the government is clearly, the king is using him as an outreach to the youth of the country and 60% of the population, 30% or

younger, and to focus on the economy of the country and a move toward a private sector economy. >> bloomberg had about eight hours worth of interviews with the deputy and one thing that emerged was the interest in technology and the interest in the future of the country. how much of an outlier is he among the ruling >> in saudi does hes you see it? stand out as somebody different, pushing the country in a new direction? >> i think several things are going on here. i am reminded of the book, the kingdom, or you talk about the dealings inside the royal families. those who know don't talk in those who talk don't know. he was pressed to drive the economic changes within the country. there is some angst about the power as a young man that he has. it is very atypical for saudi arabia.

having said that, the other countries have shifted to a younger generation for leadership, notably the united -- and qatar. i have seen the shift happening in saudi arabia. does that mean the prince will leave that, but he will certainly be the centerpiece of the evolution toward the next generation. about theit more plan, i want to pull up a chart. you are seeing a juxtaposition of the price of brent crude. you see that going down in crude oilties of interest rate, going down, so clearly there have been motivating factors for this. can it be in a committed, the move away from oil? >> i do not think i can oversee the challenges associated with it. having said that, they had been modern economy.

as you know, they are adjusting, many of the subsidies, gasoline, focused on sets of these and electricity and water. in developing a private sector economy is, how do you affect and empower a young and highly educated class of young people to become entrepreneurs? you have a culture that does not celebrate failure like we do. there is no small business administration, no small business in government contracts. focused on entity entrepreneurs, and you do not yet have a culture of entrepreneurship. those of the challenges to deal through an money will not solve the problem. news that 200some plus troops will be sent to syria. here is a question about the region more broadly. we have seen isis with setbacks.

put this in context, the decision to send those troops, what decision could they make? >> in the near term, you will roll back isis. clearly from the president's statement, saying that the losses isis has not heard suggest that with a more robust footprint, we can accelerate that. it is only the first start. element, one is a rollback of isis in syria and iraq and the second one, reestablishing border security and internal security, these are for countries like kenya and nigeria and jordan, who face threats from isis, boko haram, al-shabaab. the other pieces you have got to win the war of ideas. that is where the countries of

the middle east play such an important role, that isis has defined itself as an islamic state. you have got to win the war of ideas with young people to delegitimize. david: thank you. we will be back with more after the break. ♪

david: jason kelly wrote a book which dives deep into the fitness center today. >> for equinox, it is happening on fitness clubs, happening in petite -- boutique fitness and soul cycle. early entry level, going quickly as well. >> what is your market share? let's it is big.

we are a private company and we do not talk in terms of private share. fitness fromury the boutique side and soul cycle and we are making great drive. >> one of the interesting things is the portfolio that has a monthly membership as well as the boutique experience. differences in terms of the consumer and the user of those products? >> i think the consumer is very similar. we are speaking to the consumer in a different way, not so much membership and >>, but from experience. it equinox member wants a full-service -- and cycle rider want something more boutique that inspires them in a different way. >>i love being in part of a but you get more and more stuff online. home, howa device at is that kind of eating into your business? all, we not see that at

see it as complementary. talk about the experience in the economy today and what is going on with retail. been abouthas always experience. cannot get it at home. it is additive and complementary and not in lieu of what we do. >> you see no pullback in any of that? >> going back to 2000, we do not see any slowdown. >> one of the most interesting things we have talked about is this recession proof element to the business. went into the great recession and -- bracing yourself like everybody else did. was flat at worst. was that a surprise? question was a little bit of a surprise that we talked about the new wealth and it is how people live their lives. it is interesting. , people arenvolved

talking about whether jim's and equinox were a fad business. this is how people lived. people today, it is part of their daily routine. people want to maintain that while on the road. yard, whenhe hudson does that come up? >> equinox hotel opens in spring. >> is that is -- is that a one off on the side? >> it is a part of the future, and we currently have six development sites around the united days in big plans for a hotel concept as well. david: thank you very much. still ahead, t-mobile reporting i had. more after the break. ♪

♪ david: you are watching

bloomberg markets with a bit of breaking news. anybody watch the warriors play last night saw steph curry take a fall. now it is been determined by the warriors, steph curry underwent a great onerevealed mcl sprain in his right knee. he will be reevaluated in two weeks time. the lasted the injury play of game for last night at houston and was diagnosed with a sprained right knee by the medical staff. not good news for courier fans -- four warrior fans. >> the five democratic primary scheduled for tomorrow could give a boost to hillary clinton's presidential bid. mrs. clinton cannot win enough delegates to officially clinched the now asian, a big performance could erase lingering doubts about whether she could pull away from senator bernie sanders. calling off to plant at public events and in the enough agreement to stand aside for ted cruz in the state.

he had planned to stay in event and indianapolis and noblesville he announced a deal to give ted cruz what he calls a clear path to indiana's may 3 primary. >> i do not see this as a big deal other than the fact i will not spend resources and indiana, he will not spend them in other places here so what, was the big deal? the brussels subway station targeted by suicide bomber has reopened. trains began rolling in this morning. 16 people were killed in the mark twain second attack. willerrorists other target likely not reopen until the summer. a foru gamest serve deflategate suspension. it overturns a lower court judges rolling.

so far there is no word on whether the patriots went to appeal. -- plan to appeal. be sure to watch bloomberg tomorrow morning as we speak to roger goodell about the decision and this week's nfl draft. local news, 24 hours a day. david: markets close in 30 minutes time. abigail: we had heavy nasdaq trading down modestly all day. the worst performer, underperforming the nasdaq overall. and no international, shares are down sharply. a bloomberg analyst says that endo already reflects those

concerns so this is already priced in. we see a bullish reversal that appears to be still underway if the stock can say above its average. from today's worst stock to the top stock, t-mobile stairs are higher.- shares are t-mobile is the most innovative of the big for wireless carriers to him and he expects the company to take share the first quarter. bullish and believes it will act as a catalyst for above the one that is bearish range. david: what we seem today with regard to the stock? abigal: shares have been mainly downcomer repairing some of the earlier losses here this is one of the --

the big deal with -- will be iphone shares. consensus is calling for 50.7 million units sold. suggests itort could be less than what analysts had been looking for, so that will be a big thing to watch and the stock is trading back into a range so we could see some volatility ahead. david: thank you so much. the ecb release their latest report on financial integration. europe's markets are increasingly cohesive but the regions banks are struggling to never be tough environment of negative rate. was next for the health of these institutions? principle, they are coping reasonably well, but clearly we

have challenges. because we had a crisis in the eurozone and we are still working on stopping some of those. nevertheless, it really depends on what your business motives. if you have a large overhang of rateits, these interest environments not really help so the more deposits to have on your books, that is the case the moren banks, there are challenges that you have. would it be better if some of the post crisis rules were loosened? is this a contradiction, and why can't some of the post crisis rules be loosened, he goes banks are saying they are finding it difficult to make money in this environment?

>> it is actually difficult to make money in this environment, no doubt about that. --o not think these policies they are targeting different policy fields. -- we have asible supervisionbank and we keep this organizationally they separate. we also have different instruments. in the long run i would argue these policy fields are complementry goes monetary policy is profiting from banks and banks are profiting from stability. let me say that i believe that the present monetary policy stand is justified, even where we are with regard to inflation.

at the same time i would argue that we need to maintain strong supervisory approach for the banks. there are so many empirical studies out there which, rightly i think, state that the better capitalized the bank is, the more loans they give and the higher quality of loans they give and the crotch area is also true. theave these -- and contrary is also true. it truly is difficult for european banks. there is a disagreement brewing between the single resolution board and the european commission on the level capitals and lenders need to protect against failure, otherwise known as mrel.

necessary.is the european commission, the total loss absorbing capacity. where do you stand on this? >> i know both positions and at in end of the day, banks europe need to follow both standards. we need to find a way how these can work together in a non-contradictory measure. that, let's remind ourselves that you can only go after 8%solution funds of total liabilities have been dealt in. sufficient loss of capacity and i would stand for the argument of the single resolution board that at least we need a percent of total liabilities.

8% of total liabilities. >> some say the eu ruled for contingent that here -- debt. they're asking for legislation that is less ambiguous. what would you advise banks rainout? -- banks right now? we do advise them not to sell the securities before there's clarification on them? >> this debate is as difficult as the structures themselves and i hear a lot of confusing things in these discussions. one thing is very clear, at least to meet. -- at least to me. they need to be explained. the intention of everything that will be done is it is clear that they have a very special rules which need to be understood and need to be explained properly.

this is not for the normal investor, but purely for professional investors. nevertheless, we do like the idea of them because it does absorb loss absorbing capacity and banks. so it is a helpful instrument to have, depending on how you sell it and distribute it. sting the central banks, the fed meets this week to discuss the state of the u.s. economy. up next we'll take a closer look at what economist do not expect them to raise interest rates this time a lot. ♪

♪ this time now for the

bloomberg business flash. just was a corp. profits. was the best performer in the service annexes morning. $2.78ue climbed 3% to billion. expects revenue to increase. red rock resort goes public tomorrow. they could raise close to $600 million making it the largest ipo on tap this year. the biggest windfall of that $335 million come from their casino management unit. for --k will buy payment the ufc. own

jerky medications has been approved to take over time warner cable. those conditions are said to -- harter. fed officials we meeting for the third time this year to discuss monetary policy. they are forecasting believe the benchmark interest rate unchanged. joe, it seems like from all indications there will be no rate hike. joe: there has been 80% chance of a rate hike any measure. -- 0%. it doesn't mean it will not be worth paying attention to. china, which we know has been a source of major anxiety for the world and the fed in particular, there doesn't seem to be any

risk and in your term of a hard landing or financial volatility. the question is, how will those be addressed in the statement? there is plenty to look at. david: what you going to be looking at? joe: i think the other thing besides the market volatility and anything you might say about foreign influence, what they say about inflation. there seems to be signs that inflation is gathering steam, a lowly last dpi report was a setback. on the other hand, she has said she is not concerned about it right now. over the last several years, there have been inflation scares,. where look like inflation was accelerating. said, we the fed has are not buying it. it will be interesting to see what the fed has to say, and that really is the missing piece.

on the employment side of the mandate, you could argue that they are totally there, it is the inflation part they are missing. david: what are we seeing their? phenomenon that q1 data has been weak year after year. at 0.3% for the first quarter, pretty mediocre data. but if you go back and look year after year, there does be a isnomenon where q1 significantly lower than the rest of the year. be,the question is going to is 2016 going to repeat the same pattern? will q2 data pick up meaningfully? if it does, great, if it does not, is a real slowdown? ahead to seelook when that could happen.

situated.eeting -- you canis a view always find an excuse not to hike. it does seem that the fed looks for those excuses. the vote is right around that if the u.k. stays in it will be a nonevent for world market. but if this mental financial center votes to leave the eu, then it could be systemic concerns, increase in market volatility, and there is this argument that the fed, if it were a coin flip, why not delay it for another few months ahead of that vote? david: the boj is more interesting. joe: i think that is the story. we have seen this impressive surge in the yen, although it that has come back up a little bit.

people feel like the economy there is flagging once again. there was a great new story this morning about the balance balance -- the massive balance sheet. that is something we are not seeing in the u.s. or europe, this direct acquisition of shares in private companies. we will be interesting to see what japan does, if anything, to further ease policy. there will be more work done on the negative rates aspect to encourage banks to lend. david: thank you very much. debate today. at the top of the hour here on bloomberg television. coming up, the close of trading just minutes away. here are the major averages as we head to break. ♪

♪ markets close in about 10 minutes. let's could check on the markets. about 20%ume is below. not much action overall and not much trading volumes. if you look at the s&p, it did make it slows earlier in the session and then recovered to some degree then bumped along. a pretty tight range for the overall session. i wanted to check on where their were more fireworks. we had that late breaking news

er being approved to acquire time warner cable. billion deal within the cable industry. we were also watching a prominent ceo switch. he's going to start later this month. it was higher earlier, with the hiring of that ceo. he is a veteran within the industry, then shares turned lower. creating a ripple effect across the from a suitable industry, particularly -- pharmaceutical industry. we are also watching another potential big deal. share, just over $800 million.

finally, a quick check. as a look ahead, we are looking ahead to the fed meeting which begins tomorrow here. if you look at interest rate futures, no chains is predicted within the next couple days. you do see an increase to more than 50% probability by the november meeting here will be meeting. latestapple reports as results. it is still the world's most viable company, but shares have been struggling. they are about 21% down from last year. what most people will be focused on here are the iphones. 65% revenue or more in any given quarter and it a much higher percentage of profits.

for apple it is all about the iphone and everyone is trying to guess where we are in that product lifecycle. are we seventh-inning, ninth-inning, third inning? where are we? apple has a history of surprising new devices in the sense that they are very good at keeping under wraps what they are working on. but the reality is this is a phone that has been around since 2007. they have done a great job with it, going forward a new to do a lot more product line extensions and they need to make that tough migration from a hardware company to services, a little bit of software, and i think content. david: forum where you sit, our apples -- our reports of hitting its peak premature? with everyone is waiting

bated breath to see with the iphone seven looks like. that will be out in september, will be my guess. who knows what surprises they have in store. there's talk of a new dual camera system with a telephoto lens. what i'm looking for is a significant enhancement in the screen technology to oled. surprise was the move to the larger form factor, which we saw with the iphone 6. that is behind us now. i think apple needs to get the watch to work, they need to get apple music to work, they need to get apple pay to work. of stuff tolot begin to contribute more meaningfully to revenue going forward. david: it strikes me as such a big event. -- such a big't

pivot. they have a line of computers, tablets, smartphones and music players. what is left? they were speculating about a car now. in my mind, the apple brand is so strong, so global, i really think they can leverage that together with the itunes that needs a facelift in my view but i think they could do it. to getn leverage that into content distribution and ultimately content creation. maybe have a winner. david: thank you. a quick look on the markets at the way up, all down about one third a percent. ♪

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>> crude oil declining from a five-month high. joe: the question is, would you you miss?at'd apple reports earnings tomorrow after the bell. how far have iphone sales really fallen? exclusive an interview with the ceo later this hour. >> we begin with market minutes. an eventful week but we do not feel any of that today. the s&p 500 slipping from a four-month high as oil slides. energy shares by far the biggest losers. the only group to fall more than 1%.