from bloomberg world headquarters in new york, good afternoon. the u.s. consumer turns cautious . the slowdown mean for markets in the federal reserve? and linkedin goes all in on its mobile app and we unpacked the companies are earning and see why analysts are bullish on the stock step late -- stock. are one hour from the close of trading. let's head to the markets desk. julie: we are capping off the month with the worst two-day drop since february. in part because of her and in part because of some economic data.

got some consumer spending numbers that did not meet estimates. all three major averages near the lows of the session. amazon in point terms is one of the things that is keeping the s&p 500 from falling more after the company reported a record net income but the other card stacked against it. sciences coming out. apple declining having its worst week since june since 2014. in percentage terms, i want to look at the big tech losers in today's session. you have seagate coming out with numbers that missed estimates. with rivalsng along is numbers suffered from demand from apple iphones.

then we have the energy clients easy in today's session. going into this running season, energy was predicted to be the biggest drag earnings wise and that is proving to be the case. phillips 66 out with numbers that missed estimates and it's pulling down many of the other refiners and is generally seen from the client and energy today. red on thet of screen for the day. how about for the month? , let's startp 500 there and look at its return month to date. .10%.only at about oil prices, if you look at how they have formed, we see much more of a gain. we talked about the daily directional correlation but in terms of percentage magnitude, there is not that correlation.

the dollar on the flipside setting up for a negative month. the dollar index down by 2.3% and we have a watched the 10-year note which is having its first negative month of the year. the yield has gone up this month going into the fed. there does seem to be an increasing outlook for increasing inflation. david: thank you. julie hyman at the markets desk. let's go to mark crumpton in the newsroom. governor mike pence endorsing ted cruz for president. ted cruz needs a victory in byiana after getting swept donald trump earlier in the week. >> i have come to my decision and i'm not against anybody but i will be voting for ted cruz in the primary. mark: the endorsement marks a setback for mr. trump. indiana's primary is tuesday.

passengers on a cruise ship in virginia have been sacked in sickened with nova virus. 159 crew and passengers became ill. the ship operated by fred olsen cruise lines [in april 16. there are more than 1400 passengers and crew aboard. rejecting anourt emergency appeal to stop texas from enforcing its voter id law. the justices said they could revisit the issue as the november elections approach. the law has been in effect for recent voting even after a trial down --- judges drag it judge struck it down in 2014. whethern iran deciding moderates or hardliners will control parliament.

it was a setback for those opposed to last year's nuclear deal with the u.s. and others. a news agency is reporting between hardliners and reformists escalated into a shouting match but wounded four people. -- that will good for people. you are looking at live pictures. police and protesters assembling gatheringn francisco, outside the california republican convention where donald trump is set to speak. last, 20 people were arrested protesting a trump event. you can watch the event live on live go. global news 24 hours a day powered by our 2400 journalists in more than 150 news bureaus around the world, i'm mark crumpton. david: the dollar slumping and consumer confince in the

economy is at a seven-month low. is there any solid way to make money in this volatile market? kevin karen is they market a markett -- strategist. looking at a note you wrote, you caution we are at serious risk for stagnant growth. guest: we have a couple things. we have productivity, which has come down significantly over the last several years and steadily. at the same time, we look at the labor force and even though the percentage of people working is increasing, the labor force is growing slowly. so you have the case for a slow growth rate, which is something that will not be welcomed as a long-term development. hopefully, that runs around but those trends seem challenge. we have to be cautious of the near-term outlook because some

of the more recent trends in data had been relatively negative. david: give us some of your tactics. guest: essentially, coming into the year, we saw at risk fromnuing, spilling over 2015 into 2016. we had constructed a barometer to gauge that and we had been over weight bonds. we got the wider spreads gave us an opportunity. we have shifted money into high-grade corporate and when we look around the world globally, we prefer to be more dollar centric than non-dollar centric. if you look at emerging markets, they have underperformed for so long, i think we cannot ignore them anymore. we actually we, introduced emerging markets into the portfolio with a longer-term

higher expected return mostly because of evaluation disparity. twod: this chart looking at ratios, u.s. market cap to gdp and pretax corporate profit to gdp. profit at the pretax come you see it taking down in 2015. guest: the two things are obviously very important for equity holders. when you look at profits, it's measured as gdp in that relatively high. that becomes a drag for us if that begins to revert back to normal levels. that is something we need to overcome maybe with individual stock picking, looking at companies that don't have that headwind. market cap to gdp, it's not a perfect measure of valuation but it gives us a general sense if the equity market is priced richly overall or higher than average in comparison to underlying gdp.

we need to see a pickup in underlying growth. we are hopeful that will happen later in the year but we don't yet see it in the data for the -- data. bloomberg look at the commodity index over the last few months, you see that taking up since january. how is that changing things for you? guest: the fed backing away from more aggressive tightening has given the dollar an opportunity to take some of the steam off its rally. consequently, all global commodities have had the ability to get a lift. oil would be a prime example. at the same time, out of china, we see an attempt at more stimulus by china. what that does is encourage the idea of pickup in global growth later in the year and the combination of higher demand for commodity and a softer dollar is exactly what the doctor ordered

as it relates to commodity. david: today, we got so much information on the consumer will start how concerning is it that we see spending down? guest: it's something you have to watch. the consumer data by and large has not been that bad when you look at overall wages, growth in employment. you see numbers that are very, very low. jobless at weekly claims and those are the lowest they have been. those trends have been increasing steadily. 2.25%e employment is up year-over-year. things likeat other automobile sales, though have come back a bit. are fading.s profits are pressured. all of those things congeal to be something that has to be watched as we move into the second part of the year. for thingsood chance

to pick up but we need to be mindful that risks are elevated given the weak data we see around the world. david: thank you. we appreciate that. coming up in the next 20 minutes, linkedin shares surging after major earnings beat. shares getting wrecked. how much of a drag is it on the nasdaq? luster consumer. what explains the drop off and what does it mean for the fed? ♪

david: this is "bloomberg markets." let's get a quick check of the major indexes.

down.p 500 the nasdaq down 40 points. let's take a look at the dollar. kevin mentioning that we can dollar headed for its close in almost a year. bloomberg now for the business flash. a look at the biggest stories in the news. america is rolling out putting itself up for sale after discussing strategic out since -- options. the business bank has been facing pressure to sell but determined it's a bad time to sell. comerica made the decision after meeting with advisers to discuss the feasibility of finding a buyer in the current market. michael pearson got a big incentive in january 2015 to boost the share price of valeant pharmaceuticals, a potential payday of $2.7 billion.

the new ceo takes over on monday. ranget list of things to the listing of the india business. that's according to people with knowledge of the matter. the offering could take place next year. was alsobank reportedly selected to work on the share sell. bloomberg business flash update. linkedin shares shot up more companyafter the reported first-quarter earnings that beat estimates. the company reported a 50% growth of jobseekers. emily chang spoke to lincoln ceo jeff weiner today.

guest: it is still early days. i think everyone would like a self navigator and our sales solution business to replicate the success in gross trajectory of recruiter. our talent solutions business is more than of $2 billion. it is a hard out to follow but i think we are off to a strong start. emily: given that linkedin is becoming more of a mature company, do you think you have the right people in place or do you need to hire more enterprise, sales-focused people who can take the business to the next level? guest: i definitely take we have the right team in place and it's really a portfolio of products at this point. we have high growth products, durable growth products, and we will continue to invest in those high growth opportunities. we will be focused on margin expansion and i think we have

exactly the right team in place to make both of those things possible. emily: how would you describe the macro environment? we have seen other big tech companies take a hit due to currencies come other issues. what do you see? anyt: we haven't seen material impact to the business. as a matter of fact, after the first quarter -- or going into the first quarter, we talked a bit about some challenges in asia-pacific. in q1, we saw strength across all of our business lines. didn't really see any material impact based on macroeconomic forces. emily: you guys saw a record number of jobseekers come up 50%. you are talking about an

importt growth strategy there and adding new things. will we see things like job salary data? tell us more about that strategy. more focused much today on the active job seeker use case on linkedin. historically, it was largely about passive candidates, enabling recruiters. that was made possible by virtue of the engagement, the fact people were updating their profiles when they warned explicitly looking for jobs. over time, we have been focused on rounding out the offering to get to active job seekers. we overhaul the desktop experience, launched a new job seeker mobile app. -- we can create a better experience for you. as a result, it has become one of the fastest sources of

engagement across our platform. we will continue to invest in providing more job liquidity, more job comprehensiveness. today, we are at about 6.5 million jobs. and we have got far more the number of jobs in our index. it's a matter of time before we bring those online as well. we will improve the relevancy of our job matching capability and over time, we would like to introduce new insights and data and salary could be an example of that. emily: given how complex linkedin's business is and yet there is no natural competitor, how do you keep your self competitive when there are startups that you may have never heard of trying to attack you from the bottom? so, we maintain a sense of urgency first and foremost with regard to our mission. we are a very purpose-driven company and every member of our team once to accomplish our

mission to connect the worlds professionals and make them more productive and also believes in our vision to create more economic opportunity for every member of the global workforce. that matters more than ever today in a world becoming increasingly divided through socioeconomic stratification, where we see a growing skills gap in youth employment. that provides us a great deal of urgency and we want to continue to execute to make that possible. weiner speaking with emily chang earlier today. still ahead, consumer spending is the biggest driver of the u.s. economy and today, numbers coming in below forecast. what it could mean for growth for the rest of the year coming up on bloomberg television. ♪

david: time now for options

insights with julie hyman. julie: as we see stocks have this steep two-day decline, i want to bring in dan denning of kkm financial joining us from in chicago. we have had this steep two-day selloff in stocks, the steepest since february. and we see the vicks take up as well. what is going on here, are there any kind of options activity giving you insight? guest: there are. i the inside he is definitely coming back to the marketplace. you are seeing some covering of short position. options sellers got used to the last month where the volatility was reduced so you are seeing some covering their putting on the vicks. we also see volatility on the vicks options spiking higher. julie: the 50 day moving average the nasdaqached for

composite, the nasdaq 100, the s&p 500 index. a lot of technology shares losing momentum here. guest: the nasdaq poised to close lower month by month. pointed out correctly. you are seeing some of the leadership failing here as we move into a newmont and the fact you see the nasdaq close below the opening of the month is an indication that sentiment has changed the momentum to the downside. emily: your trade today has to do with iw and. why are you choosing to smoke is -- focus on this? the small sector of 22% from the february lows. the leadership is there owing. some of the distress you are

seeing in the tech sector will spill over and do think the small caps are vulnerable to any weakness in the leadership. will roll over much more significantly. i am looking at a's red to protect against -- at a put to protect against further weakness. i'm looking at the july 12 106 foot spread -- put spread. i think we can go to 106 in short order. if we see further weakness in the general market as a whole. more than halfway through earning season and we have seen some of the trading being driven by earnings. what are the chances that things could sort of looked up from here, that some of the remaining reports we get could turn sentiment around? always aat's possibility. this market has shown tremendous resilience over the last couple months and the expectations are

that there seems to be significant bearish at this level. the trend of economic front moving into this quarter, those things will way on this market and i think valuations will end up lower in the next quarter. julie: thank you so much. as a mentioned, the s&p 500 is unchanged on the month. energy, material, financials have done well. information, technology have been on the way. we will be right back. ♪

david: a light shot of police and protesters outside the height of regency outside of san francisco. several hundred protesters

gathered outside the republican convention where donald trump was scheduled to speak at 12:00 california time. the motorcade getting to the site but we see protesters right at the door of the hotel. outside a trump rally in california last night. start event expected to soon. john kasich expected to speak at the convention tonight and tomorrow, senator ted cruz will speak around lunch time. you can watch this event live when it starts. go to mark crumpton standing by in the newsroom. mark: u.s. attorney general loretta lynch says the justice department hasn't set a deadline for the investigation into former secretary of state hillary clinton. she made her comments to donald hunt during an interview on the

charlie rose program. we will do a full and independent review of everything that comes to our attention. we don't make predictions for the time because that potentially cuts off the independence of that. we've predict the timing of any of our matters. the entirean see interview tonight on charlie rose on bloomberg at 7:00 and 10:00 p.m. new york time. vice president wide and is en route to washington following talks in rome with the italian prime minister. -- white house did reveal didn't rebuild what was on the agenda but italy, the u.s., other countries are struggling to deal with the instability in libya. mr. biden also had a private meeting with pope francis as they prepared to give separate remarks at a conference on regenerative

medicine. puerto rico's health secretary says the island has recorded its first eco-related debt. a 70 rural and died from a drop in blood platelets in february. the u.s. territory has seen more than 600 zika cases. doctors without borders said the death toll from this week's bombing of a hospital and nearby tolding in syria has risen 50, including six medical staff and patients. the organization warned the are in dangernts of being completely cut off in but without medical care. and strikes international condemnation. global news 24 hours a day powered by our 2400 journalism one 150 news euros -- news bureaus around the world. back to you. david: the nasdaq is down 1.6% for the month. we go to abigail doolittle at the nasdaq. down one .6%nasdaq

and down you with 3% on the week. it will be the nasdaq's worst weekly decline in 12 weeks. what may stand out the most is a difference between the dow and the nasdaq on the year. the dow is up more than 1.5%. 5%.nasdaq down about this chart out as a divergence between these indexes and it could that be? as to whether or not the tech prove whetherill the rally out of the february lows could continue or if we will see a new leg lower. dragging the most this week, apple. shares down more than 10% stop the iphone maker did miss sales estimates and offered a well below consensus. this, carl icahn did tell cnbc yesterday he sold a nearly three-year stake in

apple in february. this has brought apple down to the buying support. the recent lows. the question from here could be whether or not those lows will hold or could there be another leg lower for apple? david: amazon forced higher today after that earnings report. the web services numbers were huge. how is the stock on the wii? abigail: the biggest boost this week. also earnings in sales. earnings they beat by 88%. $1.07 per share, beating consensus by $.57. on lots of bullish activity this here. jpmorgan now holds a price target of $915 per share, suggesting amazon could for from here.

down shares of amazon are more than 5% from their record high. david: thank you very much. flurry of economic news today, including personal income and spending. what do the numbers say about the state of the american consumer? joining me is joe weisenthal. let's take these in-kind, let's start with the consumer spending. the consumer income numbers were fined, basically right in line. consumer spending was disappointing and the savings rate, the gap between the two of those coming at the highest level since february 2015. all of the data so far this year particularly has been pretty mediocre and this confirmed that. there is hope may be there has been something wrong with the measurements but this confirms q1 was not a particularly impressive start for the

economy. david: consumer sentiment. joe: this was interesting because it takes down a bit. not a huge deal. still pretty lofty. what was interesting was the gap between consumers characterization of the current situation and the outlook. there was no deterioration in how people feel right now. there was rising concern about what will happen in the future. which consumers expressed ongoing anxiety about the election as a reason why they are getting nervous. it would be impossible it seems that could be something that would cause you asked. david: i mentioned the deterioration based on how people feel right now. they feel all right? joe: they feel all right right now. much hasn't been deterioration. probably the market rally we have seen since february has

helped a lot but right now, they are doing ok. it is their assessment of future conditions where we see the weakening. lotd: we were talking a about inflation. do we get a sense of what people's expectations are? joe: they never really change. [laughter] weirdt seems kind of because they tend to be pretty disconnected from reality. their expectation seem to always be about a percentage point to high but they don't seem to change much. some economists put a lot of stock in sumer expectations of inflation and they would like to see them rise of the believe consumers expect higher inflation and he will buy more and that will drive. david: energy, how is that playing into this, gas prices for instance? thingsat is one of those that goes back to the savings rate with all of his expectation that lower gas prices would feed into higher spending but

instead, so far, that has mostly been going into higher savings. one theory a lot of economists put forward was that people didn't believe low gas prices were permanent. there has to be a permanent state for them to change their behavior. now with oil picking up a bit, we will see how it reads through to gas prices and generally's aching, higher gas prices lead to lower consumer productivity. david: the fed meeting this week was about inflation and less about the labor market. what does the index tell us? joe: last summer, right around this time, we got a series of hot index print. a year ago, we got someone that looked like it was taking off. there were a lot of really excited geeks watching the economic data like this is the time wage growth is really

happening and i was among them. thosestead, we have seen head back down. that is kind of disappointing. it's not terrible but it looks like a sign we were getting a real breakout in pay. it's still not totally there yet. david: last question. how important are the consumer spending figures to policymakers when they are looking at the u.s. economy, how much credence are they giving them? joe: i don't think that much. fed lookinget -- a at employment and inflation. outside of the fed, there is no such thing as policymakers. theoretically, but it's an intellectual exercise but nothing would actually happen. it doesn't seem like something the fed pays that big attention to.

that is what would really catch of the attention of policymakers. david: thank you. we will take a look at the live shot of california. this is the site of the california republican convention. donald trump scheduled to speak at any moment. protesters at the doors where the event is taking place. donald trump scheduled to speak theore -- any moment at california republican convention. there was a's reach last night with a heavy protest presence. you can us that live on your bloomberg. just type lives go. ♪

david: time for the bloomberg

business flash. accordion health care working with greenhill companies to seek private equity. the canadian drugmaker has contacted by out forms to gauge interest in a possible takeover. talks are still in the early stages and the firms may choose not to make an offer. year's top national football league prospects are going to the los angeles rams, the eagles, and chargers. its investment in football by signing endorsement contracts with a 15 members of the rookie nfl class. one. armour has just no word on how much in a key is paying the rookies. the big looking into cases of prop -- improper expense reports adding.

that is according to people with knowledge of the matter. the investigation has led to the departure of several bankers get by in the past excellence, and the three managing directors. business flash update. let's turn back to our top stories. exxon mobil topping. >> some of the basic ingredients and chemicals are things like natural gas, anything -- methane. crude oil has gone higher so that spread has widened and that is a little link to the chemical returns the companies are delivering. global demand for stuff is actually pretty good. we saw last year a crisis of

prices. prices crashed for most commodities but in terms of quantities consumed, is been quite ok. and it seemsy well some companies are doing ok. of thert about a lot energy companies squeezing cost out of the equation to create a better situation but it's still costing exxon a lot to get oil out of the ground. >> if you chart extraction cost, it's pretty dramatic. this shows that extraction cost hasn't come down with the price of crude. this only goes to 2015. the price of crude will be up another 25 percent and you actually see down 33%. ask you, when we look at extraction cost, that is askederent number than

next we have seen about a 20% ostuction in c operating. it could be a multi-your timeframe. what we are doing is part of the reason why we are seeing these across the board. andf i look at a comparison chose to slash its dividend, it has the highest reserve replacement ratio. it will maintain capacity. cuts.e seen big capex what will be the c of these cost cuts from the companies maintaining dividends versus

those that acted early and have a high reserve replacement ratio? the pullback in investment is going to affect production down the road. exxon, they're already gunning for their production to be flat or the end of the decade. even hitting that target will be difficult given the pullback we have seen an investment. exxon's cash flow is stable enough to not only support the existing dividend but do have a progressive dividend and we did see that this quarter. i think finding the right balance between shareholder distributions and investment is an orton ring and i think in a sans case that while they could disabilityg more, dividend is important and i see no risk in it at all. david: francisco went down to

talk about oil. guest: demand is very strong and we had a bumper year in 2015. we continue to have strong demand despite a warm winter. supply in the u.s. is falling pretty quickly and globally. in the second quarter of this year for the first time in three years, we will have a combination of lower supply and robust demand leading to a change in dynamics in the second half of the year. the market is looking stronger. i don't think it's -- i think there's a seasonal story, a cyclical story but if you look at the fundamentals. barrel, do we stay at that level for some time? guest: i think the oil market will be volatile for some time to come. you will have to keep listening to me for longer. [laughter] i don't think we will see a

stable market because i think the saudi's have very little incentive to stabilize prices as they did a few years ago. francisco blodgett earlier today on bloomberg go. tradingp, the close of is just minutes away. let's take a look at the major averages. the dow down 49 points. the nasdaq down .6%. the s&p 500 down about half a percent. and a look at the dollar headed for its lowest close in almost a year. more bloomberg markets coming up here after the break. ♪

david: this is "bloomberg markets."

amc entertainment topping earning estimates. also record revenue in the first quarter. revenue just shy of estimates. joining us is the chief executive, added mayor and. let me -- adam aron. it's very nice to be with you. we are very excited about the acquisition. by dividing the second and fourth largest movie theater in the u.s., amc, assuming the transaction is consummated, will become the largest movie theater exhibitor in the world. in terms of its status, we have two major hurdles to get through. the shareholders need to approve the transaction and the justice department needs to approve the transaction. we are quite optimistic that this transaction is going to get

approved and will happen in 2016. david: have you had conversation with the justice department? joe: we have started our conversation with the justice department. they are very professional. we have experienced working with them, completed an acquisition of star plex cinemas in december of 2015. we are looking forward to with the justice and if they have concerns, we will satisfy them but we are optimistic. david: i wonder if you are looking outside the u.s., if you think there may be some international expansion in the future. joe do think there's an opportunity to look outside the united states. our shareholders and board of directors have looked to me in the eye and encouraged me to think boldly and broadly about the future of amc. we aspire to be the biggest and

best movie theater chain in the world. if there is opportunity abroad, we will take a look. the earnings report today mostly good. i wonder if you can give us your forecast for ticket sales. do you forecast them going down a bit in the second quarter? guest: before we jump off the first quarter, the first quarter was so spectacular -- you might indulge me and give me a bit of a victory lap because we had a record everything in the first quarter. our revenue up 17% year-over-year. our eps was up 383% year-over-year. eps was 45% ahead of consensus. we would love to be able to deliver those numbers into the future. looking ahead, there may be some

challenges in the second quarter. there were some huge movies that opened up in the second quarter last year but usually look at a company like and see with a with ant -- like amc viewpoint of 90 days. if you take a long-term look, starting with the summer movie season, the movies that open in july, as we look at the next 2.5 years, we are looking at an incredible run of blockbusters coming out of hollywood studios. we are projecting that 2017 and 2018 will be industry records so we are quite bullish about the future prospects. david: thank you very much. adam aron, the ceo of amc entertainment. less than water minutes before the close of trading. .6%, 1.5% forn the month. look at the california

republican convention where donald trump is scheduled to stick. protesters outside the hotel he is scheduled to speak at any moment. there were protesters at last night's event. more bloomberg coming up. coming upu miss?" next on bloomberg television. ♪

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>> big tex terrible, horrible, no good, week of fairy bad earnings