midday in u.s. stocks. the 10-year note touching a record low earlier before bouncing, now at 1.39%. let's go to michael mckee in washington for those minutes. are looking for guidance and future fed moves, you will not find it in these minutes. committee thata is groping to figure out what the prospects were poor the u.s. economy. -- for the u.s. economy. grexit gets surprisingly little mention in the minutes. an acknowledgment the vote could be a risk, but no detail on what members thought the risks might be or what policy might be appropriate. get surprising little mention in the minutes. just 38,000 jobs were created. many participants felt the distorted bykely

the verizon strike and statistical noise. some suggested the lower rate of gains could be a suggestion of a general slowdown ahead while others blamed weak hiring on the inability of employers to find employees. almost all the participants judged a surprisingly weak may increasednt report their uncertainty of the labor market. there was also a uncertainty about inflation. for the fed to reach the 2% target. some thought the progress could be very slow. other concerns, the slow pace of business investment and the prospect of slower growth overseas affecting the u.s. economy. participants agreed it was advisable to avoid overreacting to one or two labor market reports.

they would need to accumulate additional information. the minutes note and remember most membersat held to their previously announced triggers for raising rates. a pickup in growth, progress towards full employment and an inflation rate on track to the 2% guidance. while it is a terrible cliche to end a story by saying the outcome remains to be seen, that pretty much sums up the fed minutes for the june meeting. there was no discussion in the minutes of jim bullard's new economic framework. several participants expressing concerns the committee's communication efforts had failed to fully important the public. -- inform the public. vonnie: we were looking for a dovish set of minutes. market participants were interested in these. what dovish signals?

mike: you don't see many dovish or hawkish signals. you see a lot of confusion and inability to agree on what might be going on, particularly in the labor market. again, not much expressed in terms of detailed concern about about, but some questions what was going to happen to the labor market going forward and whether or not we would finally see signs of inflation. julie: is there any mention of s thatw much hated dot represent the feds forecast for interest rates? there's been questions about the utility of them, even fed members raising questions about them. was there any talk in the minutes that this is something that was discussed? mike: no, maybe it fell under communication fed -- no discussion of jim bullard and his new economic framework. he left his dots in place and

provided no long-term guidance. no clarity on that, either, julie. vonnie: does this put september back on the table? mike: it does not take it off the table. we get more labor market information on friday. they would want one or two more reports to give them some idea of what was going on. september could still be on the table. vonnie: no change so far. look at how the markets are handling the fed minutes. as mike portrayed it, these minutes are going back to data dependent. investors have a lot to digest today, not only the fed minutes, but also in the morning, we did have those service providers expanding more than expected in a sign of a healthy economy here. markets were in the red earlier, in the session, now turning

positively in the green, gaining momentum around noon, now climbing. dow almost.3%, the as much and the nasdaq surging .5%. losses in thee previous session, it is back in , stillen, gaining .3% seeing it trade around 16 times earnings, one of the highest valuations around the world. above its own three-year average . take a look at gold, we've seen investors flock to save havens, now singled -- now seeing gold climbed .8%. the dollar is doing well. it was unchanged before we had those fed minutes. ground, .2%.ing

out a ratee priced increase until at least 2018. we are seeing bond yields across asia, across europe falling to record lows. debtrillion of government across the world trading below zero, yielding below zero. the 10 year yield currently rising .9%. , 123er record low today earlier in the session. we are climbing from those low yields. futuresook at the fed compiled by bloomberg on the terminal. a bit of a lag when it comes to these traders pricing and the probability of a rate hike. traders have priced out a rate hike for the and of this year. -- and of this year. vonnie: more on fed minutes in

just a moment. of course, you can find this .tary on tlive ramy: president obama says he will slow down the u.s. withdrawal of troops from afghanistan. in place 8400 military personnel by the end of this year to help afghan forces cope with a precarious security situation. the decision on making today ensures my successor has a solid for continued progress in afghanistan as well as the flex ability to address the threat of terrorism as it evolves. : u.s. troops will continue to focus their efforts on counterterrorism missions. hillary clinton is on the campaign trail. trumpss donald background in a leading city is

a clear demonstration of what he might do to the american economy. "if your governor would start doing his job instead of following donald trump around holding his coat, maybe we could get new jersey's economy moving again." a court has convicted seven -- the defendants were sentenced to prison terms ranging from six to nine years. they were convicted for the roles in military training and other activities. spanish court has sentenced international football star messi toessy -- lionel 20 months in jail for tax fraud. he's unlikely to miss any games under spanish law, people can avoid serving time for a sentence of under two years if they have had no kernel record.

.- no criminal record global news 24 hours a day, powered by 2600 journalists and analysts and more than 120 countries. julie: still ahead, we will have more on the minutes from the fomc june meeting. here is a check across asset classes. the s&p 500 holding steady with a gain of .3%. the dollar index little changed and crude oil gaining almost 2%. this is bloomberg. ♪

vonnie: this is "bloomberg markets." julie: back to the breaking news

now, the june fed minutes. joining us is michael mckee washington and john bellows in california. you, both. seeing mucheally difference in the markets since before the minutes. thehere anything you saw in fed's commentary that would lead you to change your view of what the fed is going to do next? john: of course, the minutes provide the context before the brexit vote. the world has changed somewhat. the context before the brexit vote, i would highlight two things. brexit, they were highlighting the increase in uncertainty due to the slow job growth. some fomc participants were

flagging downside risks to their economic outlook. peopleans there's some at the fomc sitting around the table saying it may not be appropriate to raise rates in the future, we have to be thoughtful about this and see how it goes. that was all before the brexit vote. brexit has added to the uncertainty, increase the concerns. you can see what the federal reserve has moved to a wait and see posture ever since. why is there so much confusion about the job growth? there was a strike factor, but we were able to put a certain number of jobs on that. mike: for so long, we saw job creation at a standard level for 12 months or more much 200,000 jobs created a month. that is unusual, not the normal pattern in a recovery, normally,

au get a sawtooth pattern and 38,000 jobs report would not be remarkable in previous recoveries. there is auggest greater economic slowdown underway or is it statistical noise? that's what they were debating in this meeting. the decision was, we don't know, so let's hold off for now. john: it is hard to do sting was between those two things. orcould be a natural slowing it could be that underlying investment and demand is slowing. that is a different and more concerning situation. given that heightened uncertainty and the inability to distinguish between those two things, i think the fed is right to be cautious and slow down. let's say you do get

180,000 jobs added in friday's jobsreport and the next report following that is also positive and we get more positive economic data like today's nonmanufacturing report, the fed'sway on decision-making process no matter what the u.s. data shows? john: i think it does because there is an increased uncertainty. that will have an effect on business spending and household spending. that can have a meaningful drag or be a meaningful headwind for economic growth. material fall in inflation expectations. this is something we've been focused on. the market is telling the fed, you will not meet your inflation

target. the fed to take that seriously. the fed cannot have confidence in the inflation outlook as long as inflation remains so challenged. he will be interesting to watch the next few months of data. i would also watch inflation expectations. that will be determinative for the fed as well. vonnie: have you seen much discussion about the long-term mutual rate? mike: there is nothing about that. the staff notes it may have come down a bit, but no discussion among the participants as noted in the minutes. you are left scratching your head as to what they think about that and whether that affected everybody's decisions to bring down their long-term interest rates. most participants we've talked to had to have to just did that was the case, but nothing in the minutes about it. vonnie: what will be the subject of discussion next time around? more jobs related or more brexit related?

mike: can you hold that question for a: 31 on friday morning -- 8:31 on friday morning? wages,t to look at the if they continue to come in with a relative bias towards moving higher, they may not want to raise rates at the july meeting, but there will be that they will be talking about it in a more proactive sense. they say they are data dependent. still very early days on brexit. we will have a lot more information in mid-september about the global impact of this. they will be watching the data just as everyone else is. you probably don't want to make it fed fund futures bet right now.

john: there will be a lot of discussion about the downside risk. some fomc members are already flagging downside risk to the outlook. that will be an increasingly big part of that. for a fed that is cautious and does not want to do anything to disrupt the economy or markets, those downside risks are important to think about. it sounds like you would still be a buyer of treasury. john: we've been overweight interest rate risk because we think central bank's will be accommodative and inflation will below. banks will be accommodative and inflation will be low. interest rates falling to record lows perhaps has moved too far. we have taken down some of that overweight. we still have a bias to having interest rate risk in the

portfolio. but we have reduced out of respect for how far yields have fallen. bellows and michael mckee, thank you so much. vonnie: coming up at 3:00 p.m. eastern, bill gross joins us with his reaction to the fed minutes and his latest investment outlook. julie: still ahead, how kickstarter manages to keep its investors happy without going public. ♪

vonnie: this is "bloomberg markets." julie: time for the bloomberg business flash. first up, u.s. chemicals joinedturer barrow has final rounds of interest -- the

private equity firms are expected to hand in final offers this month. frankfurt is the favorite destination for banks considering a move out of london after brexit. the report says 77 percent of respondents expect relocations within two years and london could lose 80,000 jobs. u.s. trade deficit grew in may by the most in almost a year. meanwhile, u.s. exporters are still dealing with slugging sales -- sluggish sales overseas. kickstarter just did something that tech startups rarely do. the company is quietly paying its investors dividends. you can read about it in the latest bloomberg businessweek.

, but typically, investors get equities. how is this different? ? an venturely capitalist would invest in a firm -- kickstarter is not going public. started paying small dividends and these investors may recoup their money that way. julie: kickstarter has profit. it is not putting the cash back to investors. josh: kickstarter has been turning a profit. aually what we see with venture backed startup is they don't want to make a profit in the short term because they are hoping that one company that

will be worth astronomically more, they want you to pour everything back in and kickstarter says we are a sustainable business. is that the right thing theirdoing and do main backers support that approach? josh: the investors i talked to ere comfortable with this. union square is the only big firm that is backing kickstarter. a lot of their investors are individuals who aren't looking to maximize returns, they got into it because they like the idea. julie: is it hard for kickstarter to attract talent without offering equity? how does that shakeout?

josh: the idea of equity as a recruiting tool is something a lot of tech startups are doing right now. it has been one of the reasons you go to work for a startup, hopefully they will be the next facebook and you will be rich. right now, there's question about whether or not those promises will pan out. there's interest in kickstarter, you will get something. at some point, the investors will have to be disclosed. will they have to go public? not taking on new investors. they are making money they can invest that way. vonnie: union square is typically out after 10 years. what is the exit strategy for union square here? josh: that is a bit unclear at this point. they say they will eventually have to sell. the dividends will make

kickstarter more attractive for whoever else comes to them. julie: an interesting company to be following. story inead the latest the latest edition of "bloomberg businessweek." path is interesting as well. vonnie: here is a look at oil. a bit of a comeback this afternoon. at $47.81. eight dollars. this is bloomberg. ♪

e vonnie: this is "bloomberg markets." julie: commodity markets are closing in new york. let's see what is moving today.

shery: oil bouncing back, just climbing because of some technical support as well as slightly weaker dollar. let's take a look at the price of grain. corn moving, down 2.4%. the contract is down for a sixth day in the longest run since march. we are seeing milder weather in the midwest. soy prices are down today because of those better weather conditions. let's take a look at the next chart -- we are talking about gold. gold prices up .6%. is at the highest since march of 2014. flocking to safe havens, helping

push prices higher there. we also have higher gasoline prices to date. this is only after plunging to the lowest level since april seven. , talkingsaw the surge about oil prices because of that as aical support as well weakening of the u.s. dollar. there -- up 1.6% there. after that drop of 5% yesterday. julie: the biggest drop in about four months. i want to bring in mark shenk. this afternoon, the api will release its inventory data. what is the outlook for the inventories?

tok: we are looking for them continue falling. if they don't, that would be a huge surprise. do, what is the anticipated reaction in the price? this time, we've been training on a lot of things other than the fundamentals. what happens with the dollar, headlines about what the u.k. and europe are doing move the market a great deal. if we get a larger than expected net decline, you could see prices rebound. i want to take a look at a chart i have on the bloomberg for folks who have be out terminal, this is looking at crude production versus inventories. -- for folks who have our terminal. both of them are trending lower. in theory, the fundamentals of oil have been improving to some degree.

where do these levels have to get before it does take precedence over the macro out there?out mark: in the second half of this year, it looks like we will have a more balanced market. u.s. production continues to rise. we are finally seeing a correction. last low prices we saw year and early this year are finally having an impact on production. you report on prices every single day. we've been in the $50 range for a long time now. what could be the catalyst that would break us out of that range to either side? mark: the fundamentals on the downside -- once we see the overhang in u.s. apply start to

dissipate, we could break down. if the fears about the european recession come true, that would also send us over. orcan never plan on war unrest, but oil does come from places in the middle east, africa, south america, places that are very unstable. is anything going on with opec at the moment? it looks like they have lost relevance for the time being. are the most important player, they want to see market share return in their direction. vonnie: there was a time we were very focused on the spread between brent and wti. now, it is very small.

a dollar and change. what does that mean to us these days? right now, we have been market on both sides of the atlantic. when you have a problem on one side, you have the spread line. vonnie: pretty much telling us it is the same story on both sides. gold continues to go ever higher. mark shenk, bloomberg news oil reporter. let's check in on the first word news at this hour. tennessee senator bob corker is taking himself out of consideration to be donald trump's running mate. he informed trump of the decision yesterday. he said the vice presidency is a highly political job and that is not who he is. ofl ryan wants the director to deny hillary clinton

informationassified during the presidential election. the department of justice is launching a civil rights investigation into the fatal shooting of a black man by two police officers in baton rouge. the shooting was captured on video. terling was outside a convenience store. he had allegedly threaten someone with a gun. the two police officers have been placed on administrative leave. the white man accused of killing nine black parishioners at a south carolina church after a have thedy wants to federal charges against him dismissed. they said they would drop the request as long as they do not pursue the death penalty. global news 24 hours a day, powered by 2600 journalists and analysts and more than 120 countries.

this is bloomberg. julie: still ahead, hillary clinton taking aim at donald trump's business record. of the hour cometh the interview with bill gross on bloomberg television and bloomberg radio. ♪

vonnie: this is "bloomberg markets." julie: let's get a quick check on the markets. looking pretty steady, taking a bit of a leg up after those minutes. 0.43% gain. the 10 year yield up a basis

point. all the action happening this morning. the reaction to the minutes, there is practically none at the moment. those minutes did not produce -- julie: crude finishing higher ahead of the inventory data. vonnie: time for the bloomberg business flash. hedge fund managers see no almost a effects on -- quarter of the money lenders expect a positive affect. none said banks will be negative. julie: henderson global investors suspending its $5

billion real estate fund over liquidity issues. it is the fourth asset manager britain'sfter decision to leave the european union. vonnie: vanguard attracted $140 inlion in new client money the last half of last year. that is your bloomberg business flash update. hillary clinton's is suspected to -- julie: hillary clinton is expected to announce her running mate soon. john hickenlooper says he and hillary clinton recently discussed their search. >> especially if you look at the challenges this country and the world faces right now, if you

are someone who is asked, you are one of the people who can make a difference and your country needs you, of course you take it seriously. we spent most of the time talking about workforce transitions and workforce training. how do you more rapidly transition people from old careers into new careers? julie: deliver was speaking with david gura. you heard what he had to say, it was pretty vague. does this mean he is indeed one of the top contenders here? and yet: vague ?hocking, right back ou

exceedingly vague or else -- i think he is on the list because they talk about the vice presidential race. foreems to speak with ease someone who might be number two -- vonnie: what would he deliver for hillary? margaret: colorado is an important state. he's had this experience as a scientist and business person. the quasi-cool factor of having -- he is a white voterstting ease among looking for a traditional presidential or vice

presidential candidate. he certainly has the selling points and he is in an increasingly diverse state. trump side to come it seems as though it is a race for people to say they are not in contention. bob corker today, joni ernst saying she is not in contention. when do you think we will find out who his people are going to be? margaret: trump may be sooner than later. we expect it to be before the contention -- convention and we are running out of time. there is the conventional wisdom about who is leading the top of both of these lists. or chris mike pence christie.

in hillary clinton's case, it may be tim kaine or elizabeth warren. these tend to be people who are not only potentially exciting to the base, but potentially solidifying, giving a comfort level to those base odors you want to have turnout. headline saying mcconnell anticipates a frank exchange with trump tomorrow. hillary clinton was speaking in atlantic city today. hillary clinton: remember what he promised. "i'm going to do for the country business."for my believe him and make sure he never has the chance to bankrupt america the way he bankrupted his businesses. vonnie: just how nasty is this

campaign going to get? margaret: they are playing it isll, they want -- only expected to intensify as he advertises. you will see a tuple strategy on the part of the campaign -- the clinton campaign. turn the narrative away from the private e-mail server. on the other hand, to try to hit trump where he would like to be strongest, his appeal to the independent voters, swing voters, the notion that he has extensive experience in business. it is the gut feeling of the clinton campaign that they can go after that. if they can pick apart his , this wouldctices be a point of weakness for him.

here is going to go after in terms of how she led as secretary of state, they will go after him as far as how he conducted himself in business. julie: the drawdown of troops in afghanistan will be more slow than had been anticipated. president obama leaves this issue for whoever his successor is going to be. is this a topic on the campaign trail? we have not heard as much about afghanistan from the candidates as they have talked about a lot of other issues. margaret: part of president is to leaveking hillary clinton in good -- to ,ave drawn down those troops the white house believes he and his advisers believe might have imperiled u.s. foreign policy and security and clinton would

inherit his legacy, she would be forced to contradict him or defend him. they are hoping on a political level and policy level this puts her in good step going forward. the budget request, how transparent the white house is about those requests and how republicans respond. on another level, whether donald trump now believes this is an issue he can turn in a negative light on hillary clinton or whether president obama has neutralized issue. this is not what he wanted for his legacy. as he said himself today, when you are carrying out policies, you have to react to the facts on the ground. ry: we are taking a look at

consumer stocks because they are among the gainers today. nonmanufacturing composite index surging. at the highest level since november, not only recouping those losses in may, surging to 56.5. we are seeing consumer stocks gaining. apparel's upcoming gaining for -- pvhth session out of gaining the most this month. auto dealers rising. the sector moving in tandem with the broader market. home builders also gaining today for a fifth session out of the last six. stocks the ones to

watch today. coming up, apple drop stupid place in china smartphone market. drops to fifth place in the chinese smartphone market. ♪

vonnie: this is "bloomberg markets." apple appears to be losing ground in china. the tech giant dropped to fifth in chinese smartphone shipments in the last court. cory johnson joins us in san francisco. it is from 12% down to 11%. cory: it parallels what we've seen from apple in the past. apple commands a massive market share and sees that bleed off as

competitors come in. we are seeing local homegrown competitors, chinese companies selling into the chinese market, cheaper phones powered on the android operating system. is it worth it? whatever apple is sacrificing in china to hang on to margins, is it worth it for apple to do that? cory: apple's experience in china has been so important for apple, it has been their greatest source of growth over the last few years. as that market has developed, we've seen competitors double around the edges of it. -- gobble around the edges of it. this is idc numbers showing even less market share. only 8% share.

if you go beyond that and start to look at where the revenues are, because apple's products tend to be more expensive than their competitors, 35% of the top line. we don't have country specific profit, but we know it's running at better than 30% profit margins there on their worst day. imagine the competitors are looking at single digit margin, they go from a percent market -- 8% market share or 11% to 80%ng to this report of the profits for the industry and at the end of the day, it is the profits that matter. apple is walking home with more money than anyone else in the game to a massive scale compared to their competitors. staywill enable them to

there and be there and develop more and come up with more and more innovation. have these numbers, we don't know what apple is targeting in china. it is a luxury, luxury product in china. apple is not going after the regular joe schmo on the street. the part of the business that fulfills their desire to make cool stuff, which means by definition it will have to be profitable for them so they can put more money into r&d and come up with more cool stuff. a business that can lead to more stuff in the future, whether it is more products, more growth, more profit for employees.

julie: aside from absolute market share and profit, what about trajectory? do we know how many units they are selling in china? at what pace is it going up? if they are selling fewer phones, that doesn't help. cory: we don't know and that is what will make this quarter interesting for apple. it could mean greater unit volume but lesser in terms of revenue because it could be cannibalizing the more expensive phones. julie: for more, tune into "bloomberg west." coming up next, bill gross. ♪

>> clock p.m. in new york. >> welcome to bloomberg markets. ♪ -- it is 6:00 p.m. in new york. >> welcome to bloomberg markets.

♪ >> from bloomberg world headquarters in new york, good afternoon theater i'm vonnie quinn. julie: and i am julie hyman. here is what we're watching very vonnie: bill gross joins us in just moments and says central bankers need to take a lesson -- may be coming soon. julie: the minutes of a june meeting reveal janet yellen and policymakers have interest rate holds because of a slowdown in the jobs market. vonnie: before the timing of higher interest rate. let's has straight to the markets desk were shery ahn a has been keeping and i and things. out anad the fed minutes hour ago and also have the report