>> it is 3:00 p.m. in new york. welcome to bloomberg markets. roadbloomberg headquarters, i am betty liu. vonnie: and i am vonnie quinn. janet yellen warning to not overreact to the weak jobs report. she was saying gradual rate hike could still be appropriate as the good outweighs the bad in the economy. u.s. stocks are kicking off a week now in green at the s&p is trading at the highest level since last july. and a bloomberg exclusive. vonnie: our interview with jack results for his chinese officials. why he is calling on china to improve monitoring policy communications. we are an hour now from the close of trade and i want to head back to the market desk where ramy has the latest. we are near the highs of the session. ramy: that is right.

the down the s&p looking like they are at session highs are than half his just off of its session highs right now. the most by 8%. all of this coming off of the back of janet yellen speaking in front of the reserve today. we saw a leg down and five at talk but she said the u.s. jobs report is disappointing. something we saw last friday, as we should not take that one significant point in time, that it is much bigger in terms of a larger fabric. let's look at what is happening with the s&p 500. you can see a clearer picture, what i am just talking about. we see the markets turning around from the losses we saw on friday, generally across the board there, and at the 12:30 hour, that is when shery ahn was speaking. after that, we saw a rebound and we are near session highs up about .6%.

the markets are shrugging off any negativity they thought might have been coming from chair yellen. to note we att 2111. the closing record high as 2130. we are within 20 points or so less than one percentage point of hitting that. let's talk about interest rates. as he deals with the tenure and the treasury. you can see similarly a leg down in terms of the yield. we are sort of right now. the yield is 1.72%, up only to pick -- two basis points. happening at what is with the bloomberg dollar spot index. then a flat but you can see a downward trend since 24 hours ago. down here, we can see this when janet yellen was speaking. how about commodities? ramy: it is interesting.

i want to show this cool chart. what you are basically seeing here, if you can see it, the white line here is the bloomberg commodities index and everything anyway 20th, it is now in the bull market of 20%. you can imagine the blue line right here. we are seeing across the board, rising. generally, in terms of industrial metals, gold, aluminum, and copper and gold is also. check with's get a mark crumpton. president obama plans to formally endorse hillary clinton has early at this week to a person in with the president's

plants. of the endorsement has not been set, but the president is scheduled to speak at a democratic fundraiser wednesday in new york city. mrs. clinton is expected to clinch the nomination on tuesday after six states including california and new jersey hold nominating contest. donald trump is dismissing critics of his comments that a judge of mexican heritage cannot be partial in a case involving him. said, "all i am endorsement has not been set, but the president is scheduled to speak at a democratic fundraiser wednesday in new york city. mrs. clinton is expected to clinch the nomination trying too is figure out why i am being treated so unfairly by a judge and a lot of people agree with it. the judge is presiding over one of the lawsuits against the defunct trump university. the department of justice officials are in north charleston today for a listing session. the doj is trying to inform the police department following a fatal shooting of an unarmed black motorist by a white police officer. the shooting was captured on video. last month, the doj announced a

two-year agency review and city officials requested the action after the april 2000 and shooting of walter scott. the officer has pleaded not guilty to federal civil rights charges. and in their 90's and emily's of fallen soldiers are commemorating d-day of normandy 72 years ago today. they are holding small ceremonies and moments of remembrance along clips with thousands of u.s. british canadian and french troops landed as dawn was breaking june 6, 1944. global news powered by our 2400 journalists and one 150 news bureaus around the world. i am mark crumpton. back to you. betty: thank you. in her speech today, janet yellen signaled that higher rates may be warranted without giving precise timing. -- quietellen'speech

period. -- ing us now j.p. morgan asset management chief 1.4 trillion dollars management -- asset management. saying yellen was expressing only limited comments and he read her comments as pretty dovish, in fact. try not to contradict. i think it is an interesting consternation. they actually had golden opportunity to raise rates probably in july. they got a little spooked saying people did not think june was on the table. there was a can or did effort by them to raise expectations and buy lots of fed speakers. they got away with it. this was interesting. the market presented it quite well.

runle were scared we would the early part of the year. a lot of volatility. the markets were saying to the fed, go ahead. we are ok with that. they pull that off. june is off the table. it is one data point. it is hard to know what to make of it in terms of market reaction as well. betty: now the question is, though it is one data point and and we couldevised

do a better jobs report in a few months, is it hard to raise rates having given that data report? alreadynk it would have been a little questionable given the grexit pull just a week later. that would have already been a little tricky. july looks more likely. that would have been nice. they will have one more data point pier 1 way to know about what they're talking about, what is grexit and what if we do get the volatility that would take them off the table in june? it would slide probably off the table anyway. they have more in that direction in the u k. you have to be careful. the polls are hard to read. the last couple have suggested a need, though if you look at the longer moving averages, you can

see the reaction in the currency. sterling has taken a little bit of a hit. vonnie: what does it mean to the strategy at this moment? whereo places like asia they are having at least currencies or parts of asia are having a rebound? >> slightly counterintuitive. we were cautioning anyway. that fits us quite well at this point. counterintuitively, i think a weaker outlook, is it moves that way, actually present -- probably benefits u.s. secretaries. our most preferred equity market, it is a slightly counterintuitive thing. .he highest quality

it probably makes you more positive on the u.s. people are pretty surprised by that. further,et to a little we made underweight emerging-market assets. the dollar, if it moves off the back of the fed, we can see that in trading today, actually benefiting equity. it is also complicating some of thee other markets in the country like japan, france and's, which now, what does it boj?for the >> the outlook has been quite difficult to read. everyone is expecting a big policy announcement in july, coordinated with a fiscal push, which seems to have gone a little bit off, which would have been great for the ecb and the

boj, which could have left it to the fed. is off the table, it makes it more difficult. equities,ved japanese kind of not taking too much of a view on that point. i do not think it is prudent. thank you. much more is ahead on bloomberg markets. an exclusive interview with jack lew in beijing. is moving in the right direction but still has a way to go in performing its economy. that is next. ♪

betty: i am betty liu. vonnie: i am vonnie quinn. betty: you can see that we continue the rally, with the leg lower your in the markets. we are now looking at janet yellen''s remarks today that may be a bit dovish. vonnie: getting ready for the round in about 15 minutes. indeed. u.s. treasury secretary jack lew and secretary of state john kerry are in beijing this week meeting with their counterparts in the chinese government. territorial disputes. david talks exclusively with

treasury secretary was about -- treasury secretary jack lew about what he wants to a college. challenges that are quite of the moment on structural reforms in china. the ownthe good news is economic future to be bright, they would have to deal with capacity that has a corrosive effect on future growth if you let the problem wenger. but it is a hard transition. -- problem wenger. but it is a hard transition. linger.lem but it is a hard transition. socially, it is a challenge for

you talk to economic policymakers and they are confident they can train people who are 15 and younger. think you have to provide income support for people who are later in their careers. threading the needle is hard. you do not have a choice. if you have access capacity and you are grinding down your future will -- future growth, that would not be good either. they made the policy commitment to make the changes. they now have to implement and execute not just -- but at the provincial level as well. the line between government enterprises and excess capacity is a hard line to see. some of the provincial governments are the home -- the owners of the capacity. >> what do you make of the global and market reaction of what we with the current over the last few months? are investors overreacting? all, what i think

it gave rise was -- would perceived by -- not asrs to be connected to the global financial system as the economy. is very much interconnected. you think growth is dropping. that the world saw a policy that was, by the government, meant to be removed by the market exchange rate,

because of economic weakness. i think it settled out. and underscores how important it china becomes more adapted at communicating its pass an analysis of the economy, because the world whatarkets are hanging on china thinks will be the next step in the economy. >> i had many conversations in august and the week of disruption and markets. i was on vacation that week. i was on china for much of my vacation urging them to first ask them to explain what they

i understood what they perceive their action to be, i immediately said that is not with the world thought. but thethem a few days deputy governor of the central offered -- went out and offered. he made -- he gave a long interviewer he explained the view. you think about communicating government policy, we knew all too well in the united states it is not just something you do once. every day, the world is wondering, are things the way they were yesterday? are you on you? it is something you have to keep -- betty: jack lew speaking with david in beijing. grexit still ahead, the referendum just more than two weeks away. volatility in european stocks could spy.

some trading tips when we come back. ♪

♪ this is bloomberg markets. vonnie: timeout for options insight. of m joining me is jim camp holdings. we are near the highs of the session. we did see it down one fed chair yellen spoke of philadelphia. what is your take? we are pushing past any lack of clarity here. fed funds jim: futures now have less than a full 25 basis point rate hike thee didn't through

february 2017 contractor that seems to be what markets are reacting to. something we thought was interesting, there are only about 13 million contracts of listed options trading. plenty of time for people to talk. we have had a number of calls incoming about that. it is technical. i think we have a graph to show. friday, u.s. equities is lower well, environment as might be pricing in sleepy summer weekend. we turnaround today and the market is whipping to the upside and higher as well, at least in spot. a bit of a shift lower going out about six months, certainly what you would expect on this type of day. something worth pointing out. classy talk a lot about grexit , that theret polls

is a 43% chance about what might happen versus a chance that it won't. there is a discrepancy there. who are you following? jim: we do recent cross-section monitor looking at 40 of the most actively traded in the u.s. options terms, and one thing that really jumped out is the tremendous amount of activity at ew g, the german msci exchange rated fund. you might question why there, and not a project more closely correlated with the u.k. and the answer is liquidity most likely. that is another msci product, much lower than the options activity. a couple of things, as far as the market view, something to volatility isd

very low though in the british is 21% of the highs level in about seven years since the financial crisis. the polls you talked about displaying a little concern. ramy: you say it is the goto product, more than 200% here. jim: we want to position for higher applied volatility essentially and to be long, a significant move to either direction post referendum and we want to go out to the july 22 expiration a week after the regular expiration. you by 26.5 strike call. you pay about $.90 for that. what you are saying is the applied volatility walks up into the event, you win, a significant move up or down with the structure, you win as well.

you just think there will be more volatility. ramy: on grexit, what is your view? i would lean with the equity markets that have a more benign outlook on the referendum and whether or not the u.k. will exit the eu a little over two weeks for that. all right. thank you very much. betty and vonnie, back to you. betty: still ahead, so far, 2016 has proved to be a tough year for him and day. consider all the deals that have come in done. company wills start to pull -- ♪ get ready for the rio olympic games

by switching to xfinity x1. show me gymnastics. x1 lets you search by sport, watch nbc's highlights and catch every live event on your tv with nbc sports live extra. i'm getting ready. are you? x1 will change the way you experience

nbcuniversal's coverage of the rio olympic games. call or go online today to switch to x1. scarlet: you are watching bloomberg markets. alix: mark crumpton has more

from the newsroom. mark: hillary clinton goes into tomorrow's california primary, meaning just 23 more delegates to clinch the democratic nomination according to the associated press. and foura, new jersey, other states hold primaries tomorrow. proponent,linton's senator bernie sanders, held a news conference in california a short time ago. sanders: if the turnout is high tomorrow, we will win. if the turnout is very high, i think win by big numbers. if the turnout is low, we will probably lose. my request to the people of california, to those people, who are prepared to stand up and fight for real change in this country, is please come out and vote tomorrow. mark: senator sanders says donald trump's attack on a

judge's heritage is reprehensible. one of the lawsuits against the defunct trump university. afghanistan's condemning of the killing of two journalists -- award-winning photographer david and an afghan interpreter died sunday in an attack. werether journalists traveling with them, but they were not hurt. he had covered iraq and afghanistan since 9/11. appeals from t does have -- death room -- death or a attendance. says he is ineligible to be executed because he is intellectually disabled. dillane was sentenced to death after a defense expert testify that black people were more likely to commit acts of violence. hostess brand is voluntarily

recalling donuts. they may have peanut residue not included in the ingredient list. some hundred thousand cases of dingdong's, and various donuts. says it has received notice of two allergic reactions involving the recalled products. ne 24 hours a day powered by our 2400 journalists in more than 150 news euros around the world. back to you. -- news bureaus around the world. back to you. the new york city startup hasn't been discussing the feasibility of going public with the next 12 months. scarlet, it was valued at more than $2 billion back in 2015 here that is a private funding round. it has not committed to exploring the possibility. scarlet: have you ever used it before?

good in the kitchen with a pot. scarlet: nonetheless, the fact that this company, valued at $2 billion at 2015 going public could say better things about their health. the stock market of the bullishness we have seen. alix: in the market, absolutely. markets close in just under 30 minute and abigail doolittle is live with more. abigail: we're looking at a rally for the nasdaq. the index is up, largely erasing friday'losses here one of the top percentage performance today the nasdaq really helping out our shares after a bullish mention in barron's this weekend could return 20% over the next 12 months, including dividends and a turnaround transition could be held by revamping store design and also cutting costs. the one-year chart does suggest a turnaround and one of last year's worst nasdaq stops --

stocks could be underway. the shares could just traded sharply higher from here. just on the year but on the day, the stock had been down more than 1% earlier. higher by nearly 1% now, all of this after hong kong's down did jamiengraded, analyst lives citing a loss of earnings potential. nonetheless on the year, another stock down sharply last year, shares up 40%, recently putting in a bullish cross. the last time we saw bullish: cross was back in 2012, head of a lot of buying momentum, and in fact, the stock more than doubled. another big turnaround story in 2016 for the nasdaq. what else stands out from

a performance standpoint? travel: the online agents, check advisor, priceline, all of this needs to be set off by bullish comments on trip advisor. michael's saying he sees bullish potential from revenues and margins from trip advisor in the second half of the year after a relatively rough first half on the rollout of the instant book. he sees the possibility the stock could rise by more than 30% from current levels. another bullish possibility. alix: thank you abigail. 2016 has proved to be a tough year for the m&a market. staples, all dead deals. facing many hurdles this year. political uncertainty and regulatory risk among the challenges. we spoke earlier with the head of global m&a hello with the --

as well as the executive editor -- coverage. >> the biggest factor is the lack of big deals. we have seen 13 transactions above $10 billion per share and last year, same time, it was like 21. the real question is why. is a number of factors. markets volatility and a challenge of the regulatory environment, and less equity activity. the stock of the seller and the stock of the buyer has gone up. was alluding to, we had a lot of deals blocked. regulators look like they are product -- applying more scrutiny. pushing back the really big deals you're talking about? asked i think it is. they have been more proactive than they have been in the past. specifically around taxes, there is tax legislation aimed at allegan's transaction.

a lot more proactive on the regulatory side. seen a handful of industries that are and game consolidation. for the same reason, the transactions have a lot of regulatory overlap. it has made ceo's is a little more reticent than to go in and try to do this you transactions. >> situation where they are looking in considering a deal, and their lawyers say, that is a great idea and strategically, they make a lot of sense. now is something going on that was not going on the year ago. >> a little more conservative given what they have seen. the biggest risk for the companies is what happens if the deal does not get done? the deal that announced in the fall of 2014. it just came apart in the spring. that is a long time for them to be in limbo. a breakup fee they get

paid for one way or the other, it helps down to the to be out for 12 or 15 months or 18 months with that kind of uncertainty, that is what is getting ceo's's pause. >> saying we're going to hold off on that. is that a sign that the m&a cycle is tapping out? you interpret what was there when people draw comparisons to a 2007 earlier 2008? robust than it was a year ago. limited -- lots of capacity with the balance sheet. rationale to do transactions and drive topline and bottom growth, -- that is why think to slow down. >> what do you look at to signal the coming end of the signal --

coming end? >> tough to note publicly is a slowdown in the pipeline. all the dialogue between companies and ceo's's are still there. matter why thet companies are getting involved in m&a? before we got on air, even talking about how cost-cutting versus the actual growth, there are two different strategies and you're seeing a shift. >> the trend we are seeing this year is a focus on topline growth. a wave of them last week. i think the big shift, if you look at the transactions we saw last year, they were cost driven to take up the cost. coming together with nokia or dell. we are seeing a lot of higher

business being acquired by oracle. that is a bit of a perceptible shift the companies are using this for topline growth. withat was glenn, along bloomberg's jeff. scarlet: coming of next, could generaln policies -- electric? we will discuss next. ♪

scarlet: i am scarlet fu. .lix: i am alix steel

what does this say about the current state of the workforce when ge is considering swapping annual races at a five-point rating scale for its employees. the first question here, why is ge doing this. what is compelling the company to make the move? >> for them, they say this is a logical next step. if people are being reviewed in different ways and more often, does deciding what to pay them once a year make sense? get people do not want to paid in salary. they might want to get paid in other ways, effects ability that does not make sense to wait until january to bring that in. scarlet: i was speaking earlier the steve about many of changes spirit take a listen. >> i have been with the company for 20 years. the cultural transition in the last couple of years is one of the most significant i have seen since i have an with the

company. it started with some moves, but what i would say is fast works, how we launch products quicker. it goes from no revenue to 2 billion in one year. the new way of thinking, contemporary, to employees. >>scarlet: how would it work?

to give an employee a sense of how it is rated in the company? the fast works program and everything they are doing, they are having these employees and will probably know in the next couple of months what they will do it for now, no real details. we thought it was interesting they were discussing the idea here it is worth the story. does that mean other companies will follow suit? how much of a model is he? click you expect other companies to begin looking at this, even now with the idea out there, we will start talking about maybe this is thing to consider. ge is that kind of company. alix: all right. great story you can catch the story on bloomberg.com. alix: investors have written off any chance global reserve will raise interest rates this month.

in his speech today in philadelphia, janet yellen signals they may not be wrong. scarlet: it was what she did not say that lends credence to the view. joining me now is joe weisenthal and our cohost of what did you miss. the phrase was in the coming months. specifice was nothing in it. i found all these instances of lines like, to be sure, on the other hand, and a few other ones. it was a very noncommittal speech. anything, she is optimistic for a while.been she thinks inflation will return to trend. she thinks the labor market is going in the right direction. she had to knowledge the reports of basically did not commit to one or the other era -- other. alix: when we got her statements, -- the second you

started actually talking, they started to slowly all. statements looked more like towing the party line but as she spoke and got more into the details, you're like, wait, one hand in the other hand. joe: we have seen the divergence in the last week and a half in equities and yields. we sighed earlier in the spring where equities have been rallying and bond yields have been heading lower on the tenure. when this happened in the spring, there was a lot of talk on whether they converge. i wondered whether that will come back up again and whether they are expected to rejoin with the other is thinking. scarlet: we will talk about this with michael later on. we will also speak with andrew left. joe: i am excited about this one. it means total bankruptcy for the stock, basically says it

is a liability dupont transferred onto the stock and wiped out completely. it is a straightforward call, not all complex compared. this is really straightforward. reports come out saying they totally dispute the report. looking forward to it. see you back in 15 minutes. ofrlet: coming up, the close trading is moments away. take a look at major average it -- averages. up two thirds of 1%. the s&p at its highest last july. a stealth rally there and the bloomberg commodity indexes up entering a bull market. scarlet: it is official. commodities for a bull market.

♪

alix: markets close in about 10 minutes. as we look at the nasdaq up higher than it was in 2016. ramy: it looks like we are on track to close near the session highs of the day. this is where we can't right now. do was up .6%. the s&p and the nasdaq up similarly by up a little more than .5%. bit of ae a little janet yellen slump when she spoke at the noon hour. actually interpreting her be more dovish than she first heard. to move up by 2% over some time frame. let's hop in and i want to show you a final snapshot of what is happening in terms of the wii's .ector health with the sector energy is up the most, the biggest leader up by nearly 2% for most of the day. this is happening with rising wti crude materials.

financials, not too far behind. you will remember that is the biggest laggard on friday after that horrible jobs report. utilities was the biggest leader p or you can see the utilities is now the biggest laggard, down .2% there. let's take a look at what is happening with crude now. it is up near session highs and one quarter percent. this number is the first time it has risen more in a pass in science of global oversupply, potentially receiving. thes take a look at some of biggest percentage gainers in terms of equities that deal with oil. transocean is up 14%. it is the biggest jump in nearly two months. 10% in national oil, also 9% there. it is not only that they are the top oil equities, but they are the top s&p equities right now. let's look at food commodities.

it is not just industrial commodities are it is also food. it is partially because of the weather. with wheat, more rain is happening with russia causing problems of 2% there. corn futures up 2%. let's take a look at interest rates and specifically with the you yet -- the u.s. 10 year. you can see the drop we saw. a little bit of a slump during janet yellen's speech, but you can see we were up near highs of the session, up three basis points. finally, if you want to hop into my bloomberg one more time, let's take a look at what is happening with the w.a.r. p unction. after all that has been that and done, this is where we stand. june meeting.e very slim chance.

a few minutes left in the trading day, let's trade -- going to an interesting trend. since the bottom. the traditional smp. that blue line, canvas become a real thing that investors can play? we are joined now. the index has not necessarily been a surefire winner. it is a new development. >> last year was pretty unusual when the equal weighted s&p was not performing as well as the normal s&p. this has been a bull market for most of the first six years. basically, everything has risen. you did not that last year. you saw facebook and apple and really leaving the gains. you look at the top 10 biggest stocks last year. they gained a fair amount last year, around 20% while the rest of the market fell.

is not the case so far. the top 10 performers this year is actually about half of what the rest of the market has done. it is quite a difference and it only makes sense that this is a bullish development on a day we are approaching you highs here. >> absolutely. how much of this is tied to etf's? it is somebody different ways. is a broad definition you can use. the index fund measures the weighting of stock on measures other than size. when you have an equal weighted index, while that is a perfect set up, they do not care how much money you have or how much your market cap is. they will look at something different. they do everything the same size. the reason why it is important is the breath of the market.

names not have the five leading to widespread rally. that is why it is so bullish. >> exactly do you have people saying when last year was only five stocks doing well, it mass the entire week as of the market. stocks are not doing so well, maybe we do not have a healthy market. also, february lows, everything has risen. definitely a bullish signal for a lot of folks who say, when everything can rise, we usually have a healthy market. thank you for the setup. we are looking for the dow and the nasdaq in the green. alix: the s&p advertised low since last july. that wraps it up for bloomberg markets. what did you miss his next. ♪ -- is next. ♪

we are moments away from the closing bell. i'm scarlet fu. joe: i'm joe weisenthal. alix: and i'm alix steel. ♪

[closing bell] s&p 500 in wti oil at their highest levels since july. joe: the question is, "what'd you miss?" janet yellen saying that the economy is making progress, but she did not say when we could affect that rate increases and why jews are off the table. t-mobile, wanting to hand out shares to every subscriber. in just a few minutes the ceo will sit down with number to explain why. joe: we really talking to the outspoken short seller who has another company in his crosshairs. we begin with market minutes. the s&p 500 closing at its highest level since november. the nasdaq climbing to its 26 in high with