markets." david: here is what we are watching this hour. stocks are mixed today at of the fed meeting ahead of earnings. materials are pushing higher. lisa: which is central bank is why thein the rally -- ecb and not the fed may be playing a bigger role in the u.s. the services ecosystem -- the numbers to watch out for in today's earnings report. markets close in two hours. let's head to the markets desk were julie hyman has the latest. julie: on days like this when you have so many earnings reports, 10% reports today alone , it is not unusual to see a lack of big moves on major averages because a lot of the movement is driven by individual

stocks. that appears to be the case today. we are in a at the" he thought we are getting earnings after the close. higher.tocks trading on the downside, health care and consumer staples putting a bit of pressure on the major averages. as we get further into this earnings season, let's take another look at ea. quarters,the past forward quarters. . drop of .9% in sales in earnings, and decline at 7.8%. we still have a long ways to go. anderms of the highlights low lights within today's session, whirlpool coming out with sales misting -- missing estimates. sales in the

shortfall -- procter & gamble with numbers that initially looked strong. --rd-quarter revenue fell by it appears to be a sales issue weighing on the shares. up 9.7% after raising its production forecast. the earnings winnings and losers. they're coming you see bigger moves, but when you added up, you don't get big moves overall. since february 11, the s&p 500 has gained almost 15%. beginning ofthe earnings season, we have seen an increase in the s&p 500.

you look at the pessimism going in, it is interesting that we have seen that. we are seeing a bit of capitulation of the bears, perhaps. , the cftc report on hedge fund longs and shorts -- here is the zero line. above this line, net long. below the line, net short. overwhelmingly long sentiment. look at the long bull run that one it had, friday is officially becomes the longest bull run. lisa: you have the t-shirt ready? julie: i have hats. let's get a check on the first word news this afternoon. = u.s. and there's from both mark: u.s. senators

authorizing letters have new million dollars in grants and loans to replace flint's lead contaminated pipes. million. the senate armed services committee has approved the nomination of the first female officer to lead one of the militaries that's one of the o lead one -- tw of the military's war fighting commands. the nominations must be approved by the full senate. says he hadf prince no known will and she is theng paperwork --

57-year-old pop icon died last week at his estate in minneapolis. no word yet if the new england patriots will appeal the four-game suspension of quarterback tom brady. the federal appeals panel yesterday reinstated his punishment for the deflategate scandal. roger goodell was on bloomberg this morning. >> we are pleased with the court passed decision. they were very firm in their decision. it was within our authority and the judgments were based on solid facts. also commissioner goodell said an nfl franchise in london has potential. global news 24 hours a day, powered by our 2400 journalists in more than 150 news bureaus around the world. i'm mark crumpton. on thewith all the focus fed and possible rate hikes, there's been less talk about the

tremendous affect the ecb has had on the u.s., particularly in credit. next guest could help us break down just how much european central bankers have fueled the latest rally in u.s. corporate credit. brad rogoff is here with us now. inre has been a 3.4% rally u.s. investment grade bonds since the end of february. not that much has changed in the u.s. the big change has been europe. has the ecb been the whale? brad: i think it has had a huge effect. the fed has been quite dovish. that has had an impact. the fed has never come out and bought corporate bonds before. bought plenty of things, but ecb has not even bought them yet. the ecb will buy corporate bonds starting in june. we just got more details on it last week. sample setying their

-- it has had a huge impact. that market is continuing to tighten as well. i'm looking at the gap in yields between u.s. corporate bonds and european corporate bonds. since march when the ecb announced that they would be buying corporate bonds, you see that gap narrowing. to me that a lot of european investors may be coming to the u.s. trying to get some corporate debt ahead of that. have you seen a lot more interest from european investors? brad: absolutely. that difference is huge. think about the numbers, you are getting 1% on the average european corporate bond. what is happening is you are having people really squeeze out of european corporate bonds.

it doesn't make sense for certain european insurance companies. we often see this affect where they announce and you see a big impact. what actually happens, it is a lot more muted. david: who is buying corporate debt? sometimes, ifgle that makes sense. it has to be funds. flows have been good in corporate bonds. you have money you have to spend at some level. the stuff with paltry yields is still a good question. people who have money to spend on corporate's. lisa: what risk is there this

could reverse? let's a v ecb does not come through with as big of a corporate credit purchasing program. brad: we think the ecb will do what they said. beir purchase program will $80 billion -- they will run out because they bonds had set caps. they will need to buy corporate spirit they will buy about $10 billion a month of european corporate bonds. we don't think that is the risk. when you go back to risks, you have to start talking about fundamentals again. in europe, does this not spur growth and inflation? how soon with a run out? that's would they run out -- how

soon would they run out? brad: on a bunch of different sovereigns, they will be running theyainst their caps -- will hit those caps at that point, which is why you have to start this june buying corporate's you don't get there on all the sovereigns. lisa: leverage is ticking up in u.s. corporations. how worried are you that lower earnings will be a problem? brad: leverage is ticking up. we don't say it's overly concerning. m&a was a big part last year. we have an earnings season with down earnings. companies are not looking to actively deleverage through paying down debt. where a lot of the spread is left in financials.

delivering,l seeing but they're up in new risks highlighted -- there have been new risks highlighted. the trend is toward deleveraging. we are concerned enough on the fundamentals but we don't think there is more spread tightening and industrials, but maybe less from financials. brad: what is the most attractive spot in credit? brad: probably still triple b. it has underperformed single a because there been less m&a, less issuance there. it looks attractive against double b, too. david: thank you very much. join bloomberg television tomorrow for special coverage of the fomc announcement.

minutesp in the next 20 , making money on the great white way. john bright julio -- john breglio on the challenges of putting on theater in today's world. how will things change for results struggling economy? david: wti and brent crude rising today. more "bloomberg markets" coming up after the break. ♪

david: this is "bloomberg markets." time now for the bloomberg business flash.

breaking news out of spain. the country is set for elections as the kings those no leader -- sees no leader forming a majority. the parties have been unable to form a new government since december when elections ended inconclusively. the collapse in oil prices have to lose the mobil top credit rating it has enjoyed -- the aaa rating has been the selling point when it competes for drilling licenses. microsoft and johnson & johnson are the only american companies left with a aaa rating. lisa: pulling $1.4 billion from fund --'s main hedge the firm will have to meet requests by the end of june. upgradingd motor

plants to build 10 speed transmission. another $200 million into its investing $9 billion in u.s. plants over the next four years. julie hyman has a check on company stocks moving on analyst notes. julie: we have all the stocks moving on earnings today, but analysts are having an effect on various stocks. let's look at 3-d systems, that stock is down by about 2%. the analyst said the shares may be pricing into much hope for upside to earnings per share estimates. the stock has rallied 60% over the past six weeks. 3-d printing stocks tend to be very volatile, more than 20% of the shares floated sold a short

in this particular stock. add to the franchise pick list higherr jaffray's -- conviction after looking at the company's u.s. portfolio and the total addressable market and -- ings edward parker over there with by ratings and saying western digital will benefit from the ship to cloud storage. we have not seen that benefit as of yet.

market has been winning. pure storage can emerge as them -- the next major datastorage franchise. micron is the best performer in s&p 500 today. play next -- more discipline in the d-ram memory chip market. he says the cap x cuts point to a much more disciplined and focused on profitability over market share. those shares surging by 10% today. come everl ahead wonder how to become a broadway producer? we speak to john breglio. break, a look at revenues for broadway plays in the last week.

the lion king is tops. ♪

lisa: you are watching "bloomberg markets." no business like show business come especially on a broadway stage. how does one even go from a story idea to a fully executed standing ovation success? david: john breglio has are presented everyone from stephen sondheim to android late weber -- andrew lloyd webber. he joins us now. very nice to see you. talk to us about the role of the producer. when you get involved with the production. john: that is one of the reasons i wrote the book because most people have a distorted view of producer. they think it is a big fat guy

who has a casting couch. the really good producer from the moment they start with the idea to the moment the curtain comes up opening night, it is an incredibly difficult job. you have creative issues, you to keep a huge number of people working together who, many of them are egomaniacs. you have business issues, you up to raise money, you have to advertise properly. your to worry about critics coming up to worry about the the of theater and after show opens, it is almost as difficult to maintain it. most people don't have any appreciation for what a producer does. lisa: 90% of productions fail. what are the elements that make the 10%, the lucky 10% successful? john: look is a major issue. luckck is a major issue --

is a major issue. you have to be able to figure out those things that you can control. you can control your budget, you can control who is going to do the show, who is going to write the show. there are certain things you cannot control. ?hat is going on in the world in the falla show right now come everyone is upset because it is the presidential election. or the weather or critics. you cannot control certain things. you have to focus on the things you can control. if you have passion for what and you control as much as you can from experience, you have a shot. frombeen around doing this chorus line to hamilton. the ones that work, nobody knew it would work. that chorus line would be the biggest hit ever or that hamilton would be the

biggest hit ever ordered the book of mormon. if you believe in the show, you have to go with it. lisa: is the population of people going to the theater dwindling? john: no. in fact, the part of the population that is growing that is most important for broadway is tourists. international and domestic. that continues to grow. the part of the broadway audience that is in most trouble are new york serious play goers. ago, 40 years ago, people wanted to see the latest tennessee williams play. that is not the case anymore. they want to see high profile disney or big musicals and plays have a very, very uphill battle. unless they are in a play that

has tom hanks and julia roberts. david: i look at what is playing right now come you see michelle williams, jeff daniels, big hollywood stars. how long is that trend going to last? that has to continue to right now, the public does not seem to want to support plays that don't have some immediate marketability. they want to see stars. fund thatrman of a runs the tkts booth in times .quare i know what people ask for all the time. these people stand in line for an hour, two hours, sometimes three and they go up to the tracer and say, what stars are in the play?

they don't ask what is the best play or whatever. the tony what won award? our culture has become star driven. everyone wants to be a star. for me, it is very disappointing because you see a great, great -- you a young writer have to say to them, your plate is not going to get on unless we get a big star. it should be about the play, not the star. , thanksohn breglio again for joining us today. news on apple this hour. the government may keep the hacking method it used to get into the san bernardino shooter's phone a secret. we have the commodity close coming up. on the way out, here is a look at oil. ♪

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mark: the hacking method that unlock the iphone used by one of the san bernardino shooters -- the decision will leave apple in the dark on the vulnerability of its product according to the wall street journal. it was thought that they would have to turn it over to apple. the fbi director says the agency was still studying the software vulnerability. told georgetown university "we are close to sorting that out." the next week will determine whether donald trouble be the republican presidential nominee. -- donald trump will be the republican presidential nominee. democratic front-runner hillary clinton is expected to expand her lead over senator bernie sanders.

the five states holding primaries today are connecticut, delaware, maryland, pennsylvania and rhode island. in iraq today, a degree for protesters calling for political reform. protestersctory for calling for political reform. after massive protests and demonstrations by thousands of followers of the shiite cleric. the changes came after iraqi lawmakers interrupted a parliamentary session demanding the prime minister and speakers that down. a 27-year-old disabled syrian refugees carrying the olympic flame in athens today. he received the flame from the head of olympic -- greece's olympic committee. they're planning to let a group of five to 10 refugees compete marching behind the olympic flag. global news 24 hours a day,

powered by our 2400 journalists in more than 150 news bureaus around the world. david: commodity markets are closing in new york. let's take a look at today's biggest movers, starting with oil. wti crude rising over 3% today. signs the global surplus is gradually diminishing. ors looking to today and tomorrow -- raw sugar rising the most new week. reports of much-needed rain and investors weighing figures wednesday that could show sugarcane doubled from a year earlier. lisa: impeachment procedures to tust presiden tilde bruce f -- still never set rousseff.ma reusdilma

david: it is up to speed. in terms oflatest where this impeachment proceeding is headed? arehe immediate steps ahead that the senate will have to come to a vote over whether to accept the petition from the lower house to open an impeachment trial against the president. that most likely is scheduled to 12ur around may 11 or may and requires only a simple majority of the senate to accept a motion from the lower house. that is highly likely to occur. at that point, the vice president will temporarily assume the president's office. while the senate conducts a trial over the president rous seff, two thirds of the lower house would have to come to a

vote and except whether or not she will be permanently removed from office or not. david: where does the forecast dan now? -- stand now? christopher: we put the odds on the senate approving both votes. the simple majority one and the one at the end of the trial in two to three months at 80%. thes highly likely that senate will end up demoting the president. once the vice president is in office around mid-may, he will move forward on new economic reforms, he will have the power of the pen of nominations and government behind him. at that juncture, it will be hard for the senate to backtrack . something dramatic would have to happen. the only way we see this not moving forward is if the massive corruption probe implicates the party of the vice president or the vice president himself. our 20%what makes

probability that impeachment does not move forward permanently. lisa: amid all the political aangling, i was struck by bloomberg story that brazil's budget deficit, the biggest among its latin american peers. 80% of its budget are mandatory expenses like education and health. what can brazil cut at this point? i think the now, investment community will start to focus on the task at hand on the reforms that are necessary to overcome this fiscal crisis. the bad news is the nature of the fiscal crisis that brazil faces is structural. as a percentage of gdp has been gradually increasing over the last 15 years. the way you resolve this crisis is not by raising taxes and temporarily increasing revenue.

it is by approving constitutional reforms that rollback entitlement spending and pension and earmark spending provisions on health and education. that is tough because if you look at it from a political point of view, brazil is dealing with a phenomenon of middle-class expectations. the nature of the reforms really run counter to these new middle-class demand. the government is still dealing with the massive corruption probe that has more shoes to drop going forward. david: play out with a day after a film president dilma rousseff impeachment. what is the likelihood that michel temer will be able to tackle these issues in short order? christopher: the vice president

has a clear political survival strategy. chancerstands the only he has to survive politically is if he presents a government that is seen as the solution to the economic crisis. we expect a very market friendly economic team. the vice president's team, they are debating right now what reforms are they going to put forth. we expect them to put forth a relatively robust reform agenda. precisely because the country is immersed in such a deep political and economic crisis, the whole upper class is spooked. our expectation is the vice president could very well move on some components of these but more on elements that impact medium-term fiscal accounts, not that impose a short-term political cost on

voters. michel temer may approve reform for pensioners. imposing real losses in the minimum wage, that is tough. there will be a long, painful adjustment. given the challenges ahead, do you think the 15% rally in brazilian bonds and the 20% rally in brazilian stock market is down for a pretty substantial reversal at some point? christopher: we have to remember .hat investors were pricing in an unhinged political and economic crisis were a restructuring of petrobras'debt were in play. the fact that you have a

possibility of a government coming in and putting structural economic reforms on the table ,nd even if they do fall short if you are making progress, that is a world of difference than where we were in terms of expectations. i would not say the fact that michel temer under delivers in his reforms means we are in for a drop in asset prices. to the extent that some progress is made, that will be the apostate. the trick be how much and how much time you can buy. it may depend upon the global --look and whether or not that will dictate how much tolerance investment community will have for a government that will make some progress but will not turn the corner quickly. david: christopher garman.

coming up in the next what he minutes, my interview with yanis varoufakis. -- coming up in the next 20 minutes. for: what will it take apple to get a passing grade in today's earnings report? david: and look at the most active stocks in the nasdaq today. micron up almost 10%. more "bloomberg markets" coming up after the break. ♪

david: this is "bloomberg markets." business/he bloomberg . janus capital group says first quarter earnings fell 21% as market volatility took a toll on

assets. lisa: the new york times planning to streamline its international operations and will cut 70 jobs. the newspaper will relocate some editing and production operations in paris to locations in hong kong and new york. david: a big reward for giovanni -- chobani's and please, a stake in the company. -- employees, a stake in the coming. flashs your business update. was ayanis varoufakis central figure in last year's debt crisis and his government wrangled with european leaders over rescue plans for athens. ultimately, he voted against the terms of the third bailout package for greece and then quit. with yanist down varoufakis and started by asking

him about life after office. i. varoufakis: the reason why am no longer minister is because i would not sign another loan agreement that would give us another extended loan on conditions of increasing corporate tax rates, increasing rates in an economy where there is no credit. heart aches in my mind constantly is trying to come up with answers to the questions of what needs to be done. there is no way of mending greece without restructuring and recalibrating the european monetary union. a quote in your book, a debt is a debt but ian unpayable debt is not paid unless it is restructured. mr. varoufakis: you cannot

overcome insolvency. especially when the new debt comes from conditions of shrinking nominal incomes. this is the tragedy of greece over the last seven years or so. take general motors. it would not exist today if it's debt was not restructured. so far in greece, it was a catastrophic manner. david: how does the vote on the brexit changer optimism -- change your optimism? i will campaign in britain against brexit. it is a huge error on both sides --the argument as to whether

it is simply a question of whether the brits want to stay in or out. this is a completely false view. the european union is a work in progress. thisxit would speed up disintegration. giganticcreate a deflationary force, a vortex with intercontinental fear. the brits can vote to get out, but they cannot leave the mess that we left behind. david: you wrote about the role of central banking. you cannot have a central bank that is a political. -- apolitical. in light of what's happening at japan,, with the bank of

the european central bank, what you say in terms of how these entities behave? yet to be data and empirically based. can you be apolitical? of course not. the fed has a mandate of price stability and keeping unemployment below a certain level. how do you balance those two pillars? independence of the fed from congress and the white house. that the fed is making these decisions without any political agenda is simply slamming in the face of reality. money can never be apolitical. david: you can watch the full interview at bloomberg.com. lisa: julie hyman has the details. julie: cliffhanger -- it is

retail. the etf up 1.5% today. let's look at the movers within it. members, is one of the the supermarket chain coming in with earnings that beat estimates even though it's comparable sales actually declined. earnings per share beat estimates, net sales per you much in line with estimates and the shares were up 4%. we are seeing a big rally in anything that is automotive related. penske automotive group leading some gains today. the company coming out with growing atarch sales the slowest pace in 13 months. some positive sentiment coming back into the auto retailer market. sonic automotive also rising. bouncing back today.

shares of autonation and carmax rise in today's session. all of these are components of etf.xrt, the spider retail versus the at it retailing index, you will see a sharp divergence. the retailing index is down .1%. 1.5%.f is up index,look at the retail 23% of it is comprised by amazon alone. 17% is home depot. what is in the etf? bloomberg,mhd on the you can see what is in it. it is more equal weighted. amazon is the seventh largest stock, only about 1.3%. the largest stock is outer wall, a seller of kiosks.

just a reminder when we talk etf's, you want to check what is in the etf and what is driving performance. this is a broader basket. different types of retailers. lisa: coming up on "bloomberg markets," apple reports earnings today. we will speak to walter piecyk, next. ♪

lisa: this is "bloomberg markets ." it is all about apple after the bell and possibly everyday considering this company has a market cap that is the size of .wo peru's the company may reveal that iphone sales slowed in the last quarter. it is a buy. walter piecyk, thank you for

coming back. walter: verizon reported and t-mobile also reported and customers seem to be holding onto their phones longer. hoping thatement is the next phone, the iphone seven might spur additional upgrades. they are in different at this point. indifferentent -- at this point. there's nothing you can mental in this version of the phone. in this version of the phone. that should be discounted in the stock when they report tonight. this will be an earnings decline quarter. is there another quarter of revenue with earnings decline? is there a quarter after that? ultimately, you get to that next december quarter. this upgrade cycle may have an

impact there. you go into an apple store, there's lines around the block. what is behind the slowdown in iphone sales more generally? part the fact that you had a huge search for the iphone six. it brought the asp up. there was a hope that people who had these older phones would upgrade into the 6s. you had slight growth now, you are looking at declining growth. some of the sales last year got pulled in from china. that is being affected by the headwind. there could be a structural fundamental issue here that people might be holding on to their phones a bit longer now that they see it costs them an extra $25 a month. are you optimistic this

less expensive iphone will catch on? walter: i hope so. it sets a new price point. apple may be more willing to cut price. this is about profitability. , if it a bunch of units cuts your margins, that is not necessarily huge positive. they canpeful that expand the market, but again, it comes down to the price. the people driving the market are the higher end consumers paying the $800 you are seeing. are they going to be upgrading as quickly as they have in the past? innovation?bout we have more than one to $2 billion of cash on the balance sheet. how interested are you going to figure out what they will do with that money? that's $150 billion of cash. walter: there's been a lot of tech reports out today reviewing

gone over the past year. there is a lot of opportunity for them. that investors are looking into the category of show us what you have commission there's hope that these new services and money can get them in. with hister piecyk apple watch. david: coming up, more "bloomberg markets." ♪

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from bloomberg boxes world headquarters in new york, good afternoon. here is what we're watching. apple reporting earnings after the bell. we tell you the numbers to watch for the world passes most valuable company posting his results. plus come starting his two-day meeting to discuss its interest rate policy. committee passes economic outlook, has it changed? build a laureate speaks about the rest of the world. we are one hour from the close of trading. julie hyman has the latest. julie: going into the close, a tight range for the major averages. weighing all of the earnings news out, waiting for the news yet to come. ee nasdaq as it