with russian officials in the oval office. he spoke to reporters at the white house. >> what the president discussed with the foreign minister was wholly appropriate to that conversation and is consistent with the routine sharing of information between the president and any leaders with whom he is engaged. >> received from an intelligence partner? >> i will not be the one to confirm that kind of information that could jeopardize our security. mark: yesterday, he initially dismissed the story is false but added today no one felt the conversation was inappropriate. the kremlin called the report complete nonsense. former acting attorney general sally yates has underscored last week's testimony about former national security adviser michael flynn. she spoke to cnn's anderson cooper. >> you warned the white house staff.

>> yes. >> did you expect them to act quickly? >> yes. >> there was urgency to the information. >> yes. mark: he did not want to fire him until 18 days later. another round of protests in venezuela has left at least three more people dead and many others injured. buildings were set on fire, tear gas was unleashed during the unrest, occurring on a daily basis for seven weeks. the president shows no intention of conceding to his opponent's demands. the violent demonstrations have left more than three dozen people dead. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. ♪

julia: live in new york, i am julia chatterley. scarlet: i have scarlet fu. joe: i am joe weisenthal. we are 30 minutes from the close of trading. julia: oil easing from all-time highs. joe: what did you miss? scarlet: working to contain a report that donald trump shared intelligence with russian officials. in washington, meeting with the .urkish president can they see eye to eye on strategy in the middle east? retail, home with depot doing well. we look at numbers in the numbers don't lie. let's look at were the major averages stand at the close. abigail doolittle is standing by. >> as has been the case in recent trading sessions, we

don't have a lot happening into the close. the dow and the s&p 500 are down. .- down the nasdaq was higher for another record close. this may stand out considering the increasingly legal nature in d.c.. investors do not seem to care. and this man thinks it is because investors are focused on the earnings season, just that much stronger, and confidence. will be interesting to see if it shifts. one sector on move, the health-care stocks. at the lows,group down 2.5%. this as the department of justice will have until the end of the day to file complaints of overcharging of medicare. we also have this company down. it will be interesting to see one moving more. and for the s&p 500, the fact it chart,lled, this is a

year to date. it is worth noting there have only been three moves greater than 1%, so the calm everyone is talking about. the yellow line is a quarter of a percent up and down, very small. worth noting 13 of the past 15 have ended with less than a quarter of 1%. , even ascomplacency the real world macro suggests investors would not be quite as complacent and the media would take a chunk out of that. but it has to do with the earnings season. that's finally take a look at this relative to the vix. there is divergence here. you see a long-term chart. is new record lows. in blue we have the economic policy of certainty index. this is the headlines that measure uncertainty. we see recently near the election, it had been near

all-time highs, starting to move back down. isthe political situation turning to pick up, but still the vix is low. it will be interesting to see what causes this complacency to finally break for investors. julia: it is funny we are talking about it so much. it seems endless. and as marc was reported, the new york times is saying israel talked about classified information donald trump mixed to the russians. this reveals the intel was about the islamic state plot to use laptops as weapons on commercial flights. for the latest, let's bring in bill fairy, who covers security for bloomberg and the senior white house reporter. thatmargaret, this intel it came from israel as is being reported, donald trump has a foreign trip coming up that includes this country. what does that mean?

reporter: it is right. it it is in keeping with the new york times story, they are coming out with a statement saying israel is completely confident entering information sharing with the u.s.. no one officially confirming what the stories are reporting, all of the pieces fitting together so that president has confidence from the israeli government ahead of his trip, but what h.r. mcmaster's said today is important for two reasons. house house [please stand by] conversation with absolutely about. and the white house and they can bring this story up under control, perhaps shifts the

emphasis to why the intelligence community is leaking information about what donald trump is doing in his private meeting. scarlet: and the response partly is ever more concerned with the leaks coming out of the executive office. are the leaks in this administration at this point worse than the past? >> i don't know if it has been worse. it is a rough start, and that is definitely the line they are taking that rather than some of the substance of these allegations about what trump may have said to russia's foreign minister and ambassador, they would like to focus on the fact that they say the leak itself to the media is what really put national security at risk more importantly than anything trump may have said to the russians. but as the line they are trying to push. certainly he will be trying to figure out who was in that room that had knowledge of the

conversation, who took a phone call at the nsa or other agencies that were aware of his number stations, and they will try to put that list together. julia: i have seen many words used to describe donald trump, ill disciplined, incompetent, but i want to bring you some tweets that trump put out actually earlier saying as president, i wanted to share with russia and openly scheduled white house meeting that i had the absolute right to do. the facts pertaining to terrorism and airline flight safety, humanitarian reasons and i want russia to greatly step up their fight against i.s. and terrorism. he has a point, we don't know whether or not in providing some element of information to the russians this is what happened. he got intel back, so there is a lot of criticism. please. >> it is a terrific point, and h.r. mcmaster wanted clarity.

he says for this conversation, whatever trump told surging lavrov -- sergey lavrov, the context was their shared interest in curving the islamic state and terrorism across borders. the president was invoking in the octoberation 2015 terrorist attack on a plane that claimed responsibility, that ended the lives of more than 200 russians. it was in that context of the laptopsnversation about and airline safety record. you will hear catchphrases from the white house. as you mentioned, trump saying it was his right to do that. h.r. mcmaster's been talking about it was wholly appropriate.

right, bill perry's and margaret talev. thank you so much. up, a counter screening company, suffering after research issued negative analysis on the company's cancers screening projects. the person behind that report. this is bloomberg. ♪

julia: see if the company's home screening kit can show the number of load doctors. extremely confident in the near and long-term growth of column guard. a man from los angeles. you have made this point in 50tement every person over needs to get a colonoscopy, but the facts don't hold true. world, isn't-best this a better option than nothing? alternative for

many people. alternative for many people. [please stand by] from the u.s. ptf, where they made a statement that you do not get any kind of: testing whatsoever, then sure, there are people. the answer in that case is the best test is the one you are going to do. but that does not mean this can ever replace a colonoscopy. the truth, if you are 50 years old, it is the second leading cause of death in men, third among women. get a colonoscopy. there is no question about it. but we are seeing, it is quite dangerous. as stock prices go higher, and ceo, ceoant -- the right out of central casting, very glib and has all the h, buts, looks very ceois he is in las vegas. thes telling people to make

biggest gamble they can ever make. they are talking that he thinks scientists could replace colonoscopies and become the standard of care without any science fact data behind it. as a shortbers seller, i fight against these type of companies. the response is yes, but we are printing cash. in this case, they are not. one more thing, only in the united states can this business model even exist. i think the u.s., new zealand, and brazil are the only three countries that allow for mystical companies to market directly to consumers. this is a market, get a colonoscopy. julia: you have made some points, and i can tackle each of them and ask your views. they produced a study in the new zealand journal saying this -- one of the cheaper

tests. the colonoscopy was 95% in detecting cancer, so you are right in the sector, but if i look at the statute from colorguard, they have a 67 compliance rate, nearly double of colonoscopies within a year with a physician's referral. is it out of the question, when there isn't compliance and people are getting colonoscopies, isn't this the better option? >> you can make the same argument them with a sit test which cost 35 or $40. so looking at a $500 test, and 25, if we don't use any of them, can we argue they are the same and you can use any? i say not. if you will not get any test at all, get a: guard, something to be tested, but go get a

colonoscopy. it is not a replacement. this is not a front-line treatment. be, it issay it could intellectually dishonest. their own science shows with the model, they disclose the fact it is inferior to sit testing and colonoscopy. practice were science because people are lazy? no. doctors will not prescribe it. joe: as you point out, the regulatory,gained -- it has fda approval. what will be the catalyst? decidedlast month, unh it would -- then they said they would not cover it. so they are not in a good position. what will make my short work?

the real question is what will make that company work. they will lose money. it is a $4 billion company, there are no signs that can replace colonoscopy. right now you will see if you look at my report orders are flat, so right now it is already showing it. if they want to get general practitioners, the low hanging the first 60,000 or 70,000. they already have it. [please stand by] >> one thing you point out in your research is physicians are not prescribing the test.

they follow reimbursement by insurers. so if that is the case, shouldn't exact scientists be reaching an inflection point as more patients are covered, leading to more colorguard test? >> they are reaching an inflection point. they have a lot of covered lives. they don't break out orders for positions. they also want to go ahead and discount what i said about the middle part -- medicare. when a company doesn't disclose, it means they don't want you to know it. so if you can show it is flat rate now -- doctor, you your would have to ask for a colorguard. that is the way medicine should be practice. companies would say they are protecting access to medicare as far as they are concerned. opposite.f argue the there are a number of things that don't tie up. if i look at revenues in the

three months of march, the 140,000 tests.m new health care providers, ordering that guard. doesn't that have concerns about this not being -- is six years old has doubled his weight in three years. how heavy will he be when we are 50 years old? is that what they will look at? they go through tv, you will see the commercials. they lose money doing it. it is not the way science is done. pharmaceuticals, you create a better strap, or you have a better value, doctors have a better. it is not i create a mouse trap, i will buy commercials and get people to ask for it. if you have a big marketing stent, you are coming off this, you will have big growth. the stock went from three

dollars to $32. it is on its way back to three dollars. julia: and when will you pull the plug if you are wrong? not wrong. am this is market decisions or not. this is a lot bigger than kevin conroy. this is cancer. this is a big market. no one will disagree with the fact where testing is going in for five years, all blood-based dna testing. i know they say it is not happening. so if that is the case, this is what you call. this can be account found in short. -- a compound in short. i have the science, the they finallyand hit the point that the worst physician, the model itself is not scaling. you cannot buy enough commercial to have people not get colonoscopies. julia: everyone should look at the task force.

i love researching these things. there are some contrasting views. great to have you on, to give your perspective. the research founder, thank you. boomand the postelection and the values of the dollar have been editing in 2017. -- ebbbing -- this is bloomberg. ♪

♪ scarlet: i am scarlet fu. heading to the close, stocks are holding their record highs, the u.s. dollar is weaker, and that may be a theme going forward. donald trump prefers a weaker dollar because it makes exports more competitive, but investors are investing in less momentum in the dollar. you are looking at leveraged bets on dollar strength outstripping dollar bet decline. 77,216.

that is the red line. this is the position of the dollar, the lowest since going year.o august 2016 last that was before the u.s. election when the consensus among investors was hillary clinton would cruise to a u.s. presidency, it clearly a lifetime ago. things have changed a lot, the dollar momentum has waned. scarlet: what about the rest of the year? treasuries, looking at chinese purchases. you can see they are holding. and you can see the government debt act in march is the most it has been for two years. perhaps good news as far as china is concerned with the red line, and capital outflows perhaps stabilizing, selling the past two years, supporting the currency and boosting the economy. perhaps we can say this is an encouraging time for china's outflows. but then in two months, it could

change. like a reversal for much of 2016, so that is encouraging. here is so encouraging news, we got the atlanta fed's gdp now tracker. it is holding up. the fact that after today, the data is 4.1% from q2, a major switch from q1, which was disappointing. this doesn't tell you anything about the overall trend of growth. gdp is oscillating back and forth. this is in part two inventory onees and think the correct to another -- things that correct one period to another. scarlet: looks like we got some weak q1 to come because of it. market close is next. take a look at the major indexes . less than four minutes, i believe it is a record high for the nasdaq, up.

the dow jones industrial average of little changed, this is coming off record highs. joe: i hope it goes as high as the euro. this is bloomberg. ♪

♪ >> "what'd you miss?"

record high, s&p 500 briefly touching a writer before edging lower in afternoon trading and the dollar is raising it is election rally -- its poster at -- postelection rally. tuning in live on twitter? welcome to our closing bell coverage every day. scarlet: we begin with our market minutes. news&p 500 did touch a record in intraday trading. closing down slightly. it made the 2400 mark. we say that in just. there was economic data but it didn't seem to sway investors one way or the other, did it? in terms of the industry groups, on the rank returns, tech once again is the best performer, sounds like a broken record

here, but it happens day after day. utilities down, telecoms and real estate's, the most defensive names who are the laggards in the s&p 500. depending on the retail that you pedal, home depot, the biggest home-improvement chain did just fine. comparable sales beat analyst estimates and the stock closed at a record high. the owner of marshals and tj maxx had a comparable sale in the quarter but it did not rise as much as expected. the dow was a bit of a ofappointment, losing 14% its value after comparable sales missed estimates. twitter got a big -- a bit of a stone, returning to the full. his focus will be on company culture, which sounds a bit like he is going to focus on boosting morale. >> does that mean more users?

scarlet: question they will want to know. at governmentlook bonds, nothing at the two-year, we had been lower earlier in the 2.32,he tenure ended in but it was a bullish day for onozone debt, lots of buying the periphery, optimism about how things are going there. a couple of random countries and bonds, italy, a two-year yield moving down sharply, portuguese two-year yields catching a nice did. -- bid. >> we are just off the highs from earlier in the session, off 1% with the dollar weaker, we struggling after those allegations over the classified information leaks with russia. giving your quick look at what's going on in the sterling versus the dollar, we have the u.k.

inflation data, initially showing a rise in sterling. seemingly not enough to spare the bank of england, rate rising with a lot of uncertainty over the brexit negotiations. this one is uncertain. we have to look at the forward here, 20 year or 17 year lows, r.b.i., central banks surprising last month with little indication that it would stop withikes of investors india looking like a buy here. trade, the best carry knocking indonesia off the top spot. finally, on the commodities front, cotton falling over 4% today. we have been talking for the last couple of days about the surge that cotton has been on based on strong overseas demand. boiled down a little bit, people obviously waiting for signs

about u.s. inventory and talk of attention opec cuts, but the questions in the u.s., are still a thing, and those are today's market minutes. >> let's take a deep dive into the bloomberg and you can find all of the following chart. given my groaning earlier, guess what i'm talking about. volatility again. i know, i know, we missed it. looking at flow into high-yield credit, it has stolen the wisdom great analysts, who wrote notes earlier about the lightning growth prospects for europe, looking at the move that they had seen in the wide shot there, with the tightening of credit spreads for the european high yield. he looked at the correlation between the vix in the high-yield in europe.

it is the volatility measure in europe, i should point that out. 0.86%, just making the point that if we do see a pickup in volatility, the vix close-out, then it looks fungible. a good reminder that it fits with the other stuff going on. it's not out of whack. let's bring in: a guest to give us some perspective on this. i want to bring in rui de fi gueiredo. perplexed bydered, the vix volatility measures across asset classes eating low? or is it confirmed by other metrics in which things are not out of whack? rui: there is no question that volatility is at a historical. it's problematic and likely to move up over the next six to 12 months. i think that the economy

globally is looking for a new equilibrium, from a policy dominated environment to one byt is much more driven normal cycles and with that i think we will see volatility pick up once again. scarlet: so, the dollar weakness has come up again. julia mentioned it. why is that creating a drag on other asset classes? rui: the dollar, in some sense, rallied a lot in the last 12 to 18 months around the back of the election. sort ofre starting to consume the fact that things are not changing as quickly as they would and the dollar really overshot or it should be. it is going to continue to get stronger, but on the inside may joe: one of the extraordinary aspect of this market, besides the low volatility, people are saying there's no volatility anywhere,

no stone left unturned. how do you think about the diversification of risk in that kind of environment? it's a great question. certainly one that our investors are asking us all the time. looking at valuations across the board, equities, fixed income, even real estate, everything seems to be not just overvalued, but if the expected returns going forward are going to be more muted, where do you go? in this kind of environment you have to be more upper -- opportunistic and nimble, both in moving around asset classes and in terms of geography and individual securities. the environment, this is the flipside of the vix being low, it's a good environment for that. across asset correlation, even within the s&p 500, the correlations among individual stocks have fallen way down. of singlede of a lot

and 80 is there's more opportunity to be more active. is there's more opportunity to be more active. >> is that a valuation story or a politics story? more of ald say valuation story. across asset classes, there are obvious reasons to be in equities versus fixed incomes in terms of risk reward, but the valuation picture outside the u.s. is much better than it is inside the u.s.. not to say that u.s. is an unattractive market. earnings in every single one of those reasons, the u.s., japan, europe, really, really gaining momentum, but valuations in the u.s. have not caught up as fast. i know that you are concerned about china. you like europe and japan, but that government mandated deleveraging, why?

everyone seems to not worry that it's going to lead to a crisis like it did in years past. why is that? why is it contained this time around as opposed to in the past, when the fed was talking about international rui: i wouldn't say that there is no chance that china would have an impact on the global economy, that if you look at all sources of credit, money supply, credit stocks, they are all. -- all down further. one interesting fact is that if you look at retail car sales in china, giving you the demand perspective, they are probably going to be down for the first time since 2009, so that all indicates that there is a risk. scarlet: you definitely have to do that. joe: we will have to remind her selves in the next one. going back your call that international markets are more compelling than u.s. markets,

that's not an uncommon view these days. guests will point to europe and flat forhaving been the last decade, or the em.amentals for you -- what gives you the confidence question mark rui: -- confidence? rui: the main story in europe is that if you look at the relative , price-earnings, price-to-book, it's still the case that europe is below or more heavily discounted the new u.s., with earnings accelerating , evenaster than the u.s. arguably loosening fiscal policy and a reduction in political uncertainty. that all means that the trend will continue. japan means there's more diversity amongst investors, so i think that's more of a hidden jewel in some sense.

it has been 25 years that japan has been fighting inflation, so it's always dangerous to call a turn in a 25 year trend, but if you look at the fundamentals in , we might be at the stage where we see the inflection point. values are again discounted relative to historical levels when japan isn't doing that well , so we think that japan looks attractive on a relative basis. >> it's been fantastic to have you. rui de figueiredo works at morgan stanley investment management. scarlet: jack-in-the-box, reporting second-quarter results . the second-quarter adjusted earnings per share beating highest analyst estimates, but still, looks like the full-year outlook might be trailing the estimates. nonetheless, looking at the share price reaction you are looking at a pop in the stock, .p i 6% in extended trading

it was down earlier, but folks have reacted to the positive news. >> news from urban outfitters in their first order, etf coming in at 13 first -- $.13. the estimate was $.15. that excludes the 15 sent store cost. -- $.15 store cost. $769million revenue, million expected. we are expecting slight growth. first quarter retail is down 3.1%. the estimate down 2.3%. this is another retailer that seems to be disappointing. got a number on the growth margin here in the fourth quarter, 31.5%. estimate on this, 32.6%. a disappointment on the gross margin as well, shares under

30% of theth revenues coming from online, it is expected to be more resilient. still, it struggles. joe? joe: coming up, insight on president trump possible eating with president erdogan of turkey. this is bloomberg. ♪

mark: i'm mark crumpton, time for first word news. president trump invited -- welcomed president erdogan want to the white house for the first face-to-face talks. president trump said that the united states and turkey must terrorist threat together. >> we again seek to face this threat together.

the turkish people have faced a horrible terrorist attacks in .ecent years, and even recently we offer our compassion to the victims and we offer our support to the turkish nation. mark: the president also noted that the country's work alongside each other at nato. on thathave more relationship coming up in just a few moments. "the new york times" sites a current and former american official who said the classified intelligence disclosed to intelligence officials by trump was divided by israel. "the times" reports that is raising the -- israeli officials would not confirm. raising the possibility that the information could be passed to a iran, israel'sto

enemy and russia's ally. mitch mcconnell tells reporters that he has not lost confidence in president trump. his comments come one day after that washington post -- "washington post" or that report. mitch mcconnell said he would like to see less drama from the white house. missed out ona the wildcard entry for the french open because of her doping ban. person,he told her in that it is his responsibility and mission to protect the game and the high standards of the game. she returned last month after a 15 month ban for testing positive for a banned substance. global news, 24 hours per day, powered by 2600 journalists and . i'msts in 120 countries mark crumpton, this is bloomberg. joe: president trump posted

president erdogan at the white house today. now, let's get some more insight now from someone who knows firsthand about delicate diplomatic relationships. nicholas burns is a professor at the harvard university school of government and former under secretary of state and served as u.s. ambassador to nato and greece. and he was the director of soviet affairs under george h.w. bush. professor burns, thank you very much for joining us. a lot of news right now on the diplomatic international run, but let's start at what got a little bit ignored today, the business of the visit of president erdogan to the white house. what does trump do with the turkish relationship? nicholas: it's the second strongest military in nato, it's a big crisis in the middle east, the syrian civil war. the challenge from isis? turkey is right in the middle of that.

turkey is going to, of course, be essential in the effort to bring a peace conference together to ultimately end that war. 12 million homeless. turkey is vital for us there and in nato. butlet: you say this, donald trump decided to arm kurdish fighters in syria. what kind of damage has that done to relations with turkey? nicholas: the turks don't like that. they don't want to see us arm the syrian kurds. but i think that both the obama and trump administration's have found that the syrian kurds are the best fighters on the ground aligned with us. thatw do you get around idea of financing terrorists? how do they rage those tensions into a coalition that can affect an element of change as far as the islamic state is concerned? it's a key issue, but we have much more at stake with

the turks. we have an entirely destabilized region there in the middle east right on the borders with turkey . and then you have the question of nato. they will be there together next week. these are the strongest military's to block russian ambitions, i think there is enough to balance the rest of the relationship. 1 -- leaders, like brca president erdogan one and others around the world look at trump and think they can trust him, as a result of what's happened in well,st week? nicholas: that's a question they ask of any american leader. all of these countries need to have a relationship with us. credibility is essential, your word is essential. here's why this episode of the president giving highly classified information to the russian foreign minister is so important. it gets to credibility.

our allies in europe apparently hadn't been briefed on this. it's very sensitive. you need people around the president who can's truth to power and counsel the president on what he can, cannot, and should not do. onelet: president erdogan said that he recognized trump, that he is more similar to him than other leaders area and by welcoming him, did trump not give him international legitimacy instantly? nicholas: he did. is turkey even a democracy anymore question mark more journalists are in jail there been any other country in the world. it's pretty much one party one-man rule right now. by inviting him so early in the presidency, donald trump is even in a major gift. scarlet: all right, nicholas burns, you are sticking with us, you're going to discuss the trump administration's effort on the report that the trump administration shared about highly sensitive intelligence.

this is bloomberg. ♪

♪ scarlet: we are back with nicholas burns, professor at the harvard kennedy school of government, previously serving as the u.s. ambassador to nato in greece. professor, we want to get your thoughts on the containment of damage from a report the president trump revealed highly classified information to russian officials. what do you think was behind this? incompetence or something more semester -- sinister? nicholas: i don't think it's anything more sinister. i think if the president not understanding how the president -- presidency is conducted. in this case we don't give this kind of information a must think about it and decided is our interest. the president can do this, he has the legal right, but the

question is, is it smart? logical? what does it say about his character, maturity? did it have the intended effect? trump,e fair to donald we don't know if he received information for what were shared. it's true, that seems plausible. earlier we heard the head -- h.r. mcmaster describing the conversation as wholly appropriate. everyone seems to have a lot of respect for mcmaster. people don't think of him the way they think or have some others in the administration. what do you make of that characterization? i think general mcmaster is an honorable person, and honest person. that's his interview and his job is of course to defend the president and our government. i just think we don't know everything was in a conversation. we obviously want to get the russians on our side to fight harder against the islamic state, but we also have to be careful about information given

to us by allies. we have to talk to those allies before we share the information. brief europe probably before you brief the russians. i don't think that this is an issue that will define the presidency. it's an issue for which the president can recover, but he has to be careful, prudent, itnk before he says things. he was boasting? you don't really want the president doing that in him -- in a meeting with the russian foreign minister. >> you have worked for two former presidents. how much time and preparation did they put into statements question mark press briefings? nicholas: enormous time. room, reading the president, reading the secretary of state for the press conferences. they took extreme care to decide what to say. they would bounce ideas off advisers, they would take criticism if somehow the formulation wasn't right. we're the biggest power in the

world. people really listen to what the president says. they parse his words. i think the president needs to realize he has this power of the careful, a little bit more deliberate, self-contained and disciplined. >> is he capable of it? nicholas: well, he's 70. one has to wonder if this is who he is after life of working, but this is a big job and he has to adapt to it. >> quickly, what is he getting right here? nicholas: he was right to bomb the syrian air base. he has been right about north korea, suggesting that china needs to do more. the president has good people around him, we all hope that he succeeds, but this is a rocky start. >> thank you for that, professor. up next, an excerpt from the interview with mitch mcconnell and his thoughts about the trump intelligence disclosure and who should be the next fbi director, as well as the future of tax or form.

when and how is it coming? stay with us. this is bloomberg. ♪

♪ time i'm mark crumpton, now for first word news. president trump's national security adviser says that information that president trump shared with the russians was "wholly appropriate" and aced on what was called open-source reporting. general mcmaster told reporters that the president's revelation in no way compromised methods or intelligence sources. >> i was in the room. the secretary of state was in the room, as you know. the deputy advisor for national .ecurity was in the room none of us felt in any way that that conversation was an appropriate. the president tweeted that

he felt he had the authority to tweak backs appropriate to terrorism and airline safety with russia. according to two committee aides, a meeting was scheduled before the washington post story yesterday about the president's meeting with russian officials in the oval office last week. in other news, they met separately today with the u.n. envoy regarding peace talks in the war-torn country that got underway in geneva. the meeting was brokered by the u.n. special envoy. however, the engineer has been overshadowed by u.s. state department decisions that the syrian government built a crematorium in one of its most notorious prisons to cover up dozens of daily executions there. syrians say that the story is not true. the new french president threw his weight kind the city's bid

for the 2027 olympics. he met in paris with the delegation for the international olympic committee. they will decide in september paris or los angeles will host the games. powered by 2600 journalists and analysts in 120 countries, i'm mark crumpton. this is bloomberg. ofrlet: let's get a recap today's market action. the s&p 500 touched a record high in intraday trade, falling back a little bit closing at 2400. your round number, joe. joe: love it. scarlet: economic data really didn't do much to change the town, the tenor of the market overall. "what'd you miss?" >> mitch mcconnell says no, he hasn't lost confidence in president trump. this comes after today's white house scramble to contain the political damage from "the washington post" report that the president revealed highly

classified information to the russian foreign minister and ambassador area earlier kevin cirilli sat down with mcconnell, who weighed in on the story. sen. mcconnell: i read "the washington post" story and general mcmaster's response, which tends to rebut the story. i think we could do with a little less drama from the white house on a lot of things, so that we can focus on our agenda, which is the regulations, tax or form, repealing and replacing obamacare. kevin: i want to talk about that, but first and foremost a lot of attention right now on who the president will be electing to replace james comey. have you spoken to the president about this question mark sen. -- toell: i have -- have the president about this? have.cconnell: i

i recommended merrick garland. i think it would make it clear that president trump would make it clear of continuing the tradition of having an apolitical professional. sen. mcconnell: do you think -- kevin: do you think that he needs democratic support to legitimize the nominee? sen. mcconnell: it would be good to have democratic support. if he picks someone with a background in law enforcement, with no history of political involvement, a genuine expert -- the reason that i mentioned garland, he's an example of that. it would serve him well, serve the country well, and lead to a more bipartisan approach. kevin: before we get the policy, i wanted to mention this tweet last week about james comey hoping that there are no tapes of their conversations. in have expressed confidence the republican-controlled committee investigating this, but should they have access to those tapes if they exist? sen. mcconnell: senator burr and

senator warner are handling that investigation and will decide what they need. in the meantime, the rest of us not directly involved in that, i think we need to concentrate on what comes next. we need to have a great choice for you director. i anticipate the president will do that and move on. kevin: how has all of this drama has described influence your ability to get ahead with health care reform? so many republicans across the country elected a republican controlled congress to fix health care. sen. mcconnell: there were tense meetings in the senate. the bill finally passed the house. it wasn't easy in the house and it won't be any easier in the senate. week we are intense discussions with virtually all the members of the senate. my goal is to get to at least 50 votes to repeal and replace obamacare and those discussions are underway. kevin: do you have a timeline on that? sen. mcconnell: well, we can't

take forever. the private health insurance market is collapsing. insurers are pulling out of markets. i don't think that we have forever to address this, but i will be putting a strict timeline on it. is nothing more personal than health insurance. can you guarantee that whatever packages fast, no one will lose coverage? sen. mcconnell: although we know now is that what we have currently is a disaster, it's unacceptable and we need to do better than the status low. another big issue is tax or form. you said that it has to be revenue neutral. tax cuts, seemingly there could be tension on division. what is the timeline question mark are you competent -- competent we could have, rants of tax reform by the end of the year? sen. mcconnell: well, it will have to be revenue neutral. we have an enormous debt. it will have to be revenue neutral. i don't want to put a strict

timeline on it. the last time tax reform was done, it took several years, but we certainly want to try to complete that. and make america more competitive. that is what it is about. we didn't have one year at 3% of during all of obama. one of the most controversial issues has been the border adjustment tax. what are the chances of the border tax being involved in all of this? it probablyll: wouldn't pass the senate, but the way that we are trying to go forward is that the secretary of the treasury and myself are trying to reach an agreement or proposal that we can all agree to start with. and of course, it will start the house. we will at some point. border adjustability is a pretty controversial thing in the senate. we will see what is in the final thing that we agree to.

>> a la senate majority leader mitch mcconnell keep -- speaking to kevin's a really earlier today. coming up we will speak more about the border adjustment tasks that senator mcconnell was just discussing. this is bloomberg. ♪

scarlet: i'm scarlet fu. "what'd you miss?" report earnings before wednesday's opening bell. earlier this month it was her order that brian cornell did not get a bonus and got his pay cut by a third after a year of disappointing sales. let's look at target in today's numbers don't lie. comparable sales have an pretty much off target.

last quarter they were at their worst number in three years. for the quarter that just ended, same-store sales fell even more, down 3%. in response to flagging sales, target will cut prices, refurbish its stores and open more small locations. make a mistake, that will be painful. they said they don't expect profit to grow again until 2019 at the earliest. this strategy is generating some backlash. investors fear that target may and this of its cachet concern is showing up in its p/e ratio relative to walmart. you can see the premium for walmart shares growing over target us is that line grows -- goes up. as target makes investments longer-term growth and reduce prices, its margins will likely suffer. one area where the investments are paying off his digital sales. their move to improve the online platforms has afforded it

growth. the moves, however, have not been enough to convince investors. target stock is moving at levels we haven't 2014. target has quadrupled combined spending on lobbying in the first quarter of the year as they work to defeat the u.s. border adjusted tax proposal. we will be following earnings on that tax before wednesday's opening bell. julia: scarlet just mentioned the border tax. steve mnuchin spoke about this issue. in an exclusive interview, mitch mcconnell plant -- painted a pretty bleak picture for the tax. sen. mcconnell: it probably wouldn't pass the senate. are trying to go forward, the secretary of the treasury, the weaker and myself are trying to reach her proposal that we can all agree to start

with. and of course, it will start in the house. we haven't reached that agreement yet, but we will at some point. julia: we learned in the past hour that the house committee hearing on may 23 book focus on this tax. here to discuss the issue, and retail earnings, lindsay roop -- lindsey rupp. lindsey: the sense we are getting coming out of that meeting, they are saying that they don't want that tax, but they are saying that they are concerned about how complex it is and they want to work with industry. retailers have indicated that it is a non-starter for us. theret doesn't feel that is much moment behind this tax at this point. i know that there are people in congress who think it is a good idea, but it is not looking good for it. our retailers feeling better about their physician about tax reform than they were several

weeks ago? sen. mcconnell: what we have isn hearing from retailers that it is not dead until it is dead. that said, government has said that they want to pay for the tax cuts. they haven't really reiterated another plan. they say that as long as it's not this way, they don't care how they overhaul the tax code i mean dashcode. code., they care -- i mean, they care, but. scarlet: some say that perhaps emotion is getting the best of them. take a listen to what they said yesterday. >> it's a bit of a self-serving .is errico specter it will be difficult and challenging with good business people will figure their way out through it. julia: the likes of boeing, ge, pfizer, they are all pro what you sell being important.

scarlet: absolutely. [laughter] for those who believe that there should be some changes, i mean, is there any concession? any room among the ceos to admit that they could roll with changes and just need to adjust? sen. mcconnell: they are really doubling down on the hard-line that this is an unacceptable and of negotiation. if you are an apparel maker, if you are gap, you import most of your goods from overseas. gap is already struggling in the fundamental shift without people buy clothes. they cannot afford another huge cost increase. joe: another important aspect of tax reform, are there other important things they are focused on? or is it this or nothing? sen. mcconnell: they also want to see the corporate rate go down, but this is what they are is ending the bulk of their time lobbying on and they are all

paying close attention. julia: urban outfitters is continuing their trend in a shift to e-commerce. i think they're going to have a tough time. they have set themselves a relatively low bar, but if they can beat it, it would be appreciated. they have had disappointing earnings. even tj maxx was disappointed with its numbers. depot, still finding a way to get it done. can we presume that it is because of the home improvement sector? sen. mcconnell: the home market is pretty old right now. most homes are about 30 years old, so people are willing to spend on that aspect of their lives. but things like apparel, or a price war with walmart or amazon, things get dicey.

, thank youy rupp very much. coming up, wall street executives and lobbyists may be .ecoming more positive we take a deeper look, next. this is bloomberg. ♪

joe: "what'd you miss?" instead of covering over president trump's big bank breakup talk, wall street executives and lobbyists are getting more confident about ditching boules that have annoyed them for years. for more, let's bring in bloomberg's max abelson. max, executives on wall street feeling pretty good. what, specifically, did they expect to see happen to me that regulatory burden? max: the best way of saying it?

everything they're worried about trump doing, which is trump's big threat that he would wake up the banks, they don't think that will happen. the big-ticket items that they want -- volcker rule, stress tests, capital, they think they will get all of those things. look, nobody knows what's going on in washington right now, but wall street could not be happy or what they think is to come. scarlet: because many of their owner in positions of power, right? donald trump's appointees have all worked for big ranks. the fcc chairman, the acting comptroller, and randy crawls is apparently the top pick for regulator for the fed. do we presume that all big bank alums speak this way question -- think this way? will anyone think outside the box? max: first of all, you hit it on the head. it's important to point out that

dodd-frank is the law of the land. if you want to repeal it, you have to do it in the legislative branch, in the house. their ownouse has got problems, but the reason that wall street is so optimistic is that they think that those alumni of the old banks are going to make life easier for them. i have to say, we already have signs, thanks to the excellent orting from bloomberg news, that those alumni are going to do the things the banks want. two quick examples of that are steve mnuchin, who said last monday, i feel was may 8, that they would be instructing five different agencies to start taking a look at the volcker rule. , i there was another example believe noriega told "the wall street journal" about, he made it clear where his heart lies, wall street is expecting deregulation, not a huge new glass-steagall. but as has been pointed out there, there are some

paradigm shifts where instead of the administration and regulators hammering heads against each other, they would work together. will the taxpayer and will the consumer ultimately benefit here? or will the banks benefit more? i have been talking to a professor who studies banking loans and has been doing so for three decades. he is legitimately worried. i talked to him after i talked to a wall street executive that was practically gleeful. and then i got on the phone with the banking law professor who said -- look, i'm really worried that taxpayers are going to have to bail out the banks again and that the laws were not significantly change. but he is referring to is a new glass-steagall, a separation in the investment of commercial banking. he's really worried that there will be another financial crisis that taxpayers will have to be on the hook for.

it's a real question. wall street is happy, but we are not sure what that is going to mean. maybe it will be great for the economy. maybe everyone will be rejoicing. or maybe, you know, five years from now after another crisis we will be looking back at this is a turning white. as you pointed out, dodd-frank is the law of the land. it will be difficult to change that. anything that we can watch for on the regulatory front? trump signed a bunch of executive orders earlier on. loosening things up around the margin. is the more the can be done on that front? weisenthal, you always know what to ask. the answer is that what is happening right now is that in washington, d.c., just in use in niche, who we mentioned a moment ago, steven mnuchin, and craig another former wall street executive, they took over the treasury department and are in the middle of a multi-month examination of wall street regulation. who are they talking to?

they are talking to people from banks. they are talking to other people , but we have reported that bankers have come in to meet with them. what we need to look at, guys, is that in june the treasury is going to come back to donald trump and say -- here is what we think should happen. that is going to be a momentous occasion. listen, maybe they will come back and say that we need to break up the banks. maybe they come back and say that the world will be safe unless we divide this from investment banking. that would mean, of course, that the wall street executives i talked to our delusional with hubris. but i don't think that's going to happen. i think they are going to come back with regulations that are exactly what wall street wants and we will soon find out. joe: all right, bloomberg's max abelson, ray reporting. thank you very much. julia: however concerned you are, as max mentioned,

ultimately these law professors are the guys who understand liquidity and the damage that has been done to it and how you can, hopefully, i just these capital requirements outside of dodd-frank or whatever goes on in order to improve things for the consumer. you can fight back and tell me i'm wrong. pretty remarkable from this administration, a bunch of bankers and the administration talking to bankers, doesn't seem to fit. julia: doesn't to so great confidence, i guess, but you can argue that there are issues like deregulation that need addressing in the market. now, a look at some of the big -- biggest is this stories in the news right now. leaving this social media company and two months after selling his start up to [indiscernible] in a blog post he said he would be focused on company culture and would not be replacing another executive. shares of twitter jumped following the announcement. bloomberg news is among

twitter's partners. former ceo mark fields is taking steps to shore up the stock price and profits. person familiar with the plan says that the automaker will still retain the tech talent it has recruited to develop driverless and electric cars. that is your bloomberg business flash. scarlet: coming up, what you need to know to he ready for tomorrow's trading day. this is number. ♪ -- bloomberg. ♪

>> earnings from target, cisco and 10 sent. -- and tencent. we will have emerging markets groups. that does it for "what'd you

♪ >> you are watching "bloomberg technology." a check of your first word news. securityserver -- adviser h.r. mcmaster says the

information shared by president trump with russian officials , andweek was appropriate the safety of a key intelligence source was never compromised. mcmaster initially dismissed the story as false. the new york times, citing a current and former american official, says the class of fight intelligence was divided by israel -- the classified intelligence was divided by israel. president trump is scheduled to travel to israel next week. mitch mcconnell recommends merrick garland as fbi director after mcconnell played a part in blocking president obama's attempt to confirm garland to the supreme court. mcconnell says the gop could use less drama at the white house. president trump welcomed the turkish president to the white house. countries, hetwo says, must battle the islamic state together.