>> we are bankrupt. just kidding. with a little joke in the market isn't laughing. is the worst over? camtek find its footing? beijingchina standoff, slaps higher tariffs on 180 u.s. products. china still wants to talk, u.s. goes silent. david: i'm david westin. alongside with alix steel. alix: it's great to see you. david: easter monday, it is snowing outside. alix: happy april, it is snowing. there is some defense if you are an equity trader, otherwise it's a calm a market, features off about nine points after the worst loss for the s&p. euro-dollar is flat. equityis closed and

markets are off-line. make ruiz still rising, at one point brent is over $70 a barrel and the best quarter since 2014. you know what happened in the third quarter 2014? after that, we will tell off a cliff. fell off a cliff. david: time now for the morning brief, we look ahead for the week. the new york fed will be out with the libor, the secure overnight financing rate. or sofr. it's job stay come with the unemployment rate likely falling below 4.1%. and friday is the deadline where u.s. trade representative lighthizer weighs in on the intellectual property proceedings, which may trigger another round from china. we're joined by lisa abramowicz.

the first topic is the mess we saw in the first quarter. but january aside, march and february were terrible. come inside the bloomberg and you can see it. the first quarterly loss was 2015 and the question, mike, is the worst over? mike: i have no idea. and i think it's a good answer because we seem to be going back to the way people used to trade, markets go up, markets go down. we have this long period of stability which was brought about by a feeling that nothing could ever go wrong if you get to a trade from the fed's point of view, that is what you would like to see. variouspeople pricing stocks for their own individual risks rather than just assuming that markets will always go up. alix: it was a really interesting look at morgan stanley, a were saying it's not that springidence tends to be strong for equity. he looks at ordered million

dollars -- $4 billion in dividend payments that could get recycled back into equity markets. this is one technical factor underpinning what could potentially be a stronger period . david: tax cuts may mean earnings go up. early fory be too that. we're talking about first quarter and we didn't start to in the tax refunds out lower taxes until mid-february. we may be seeing historical slowdown in the first quarter that we have seen. if we are to see stimulus, we're going to see it. as narrative comes which we the economy going, which heightens the interest in all the economic indicators this week. david: the second story is about elon musk and tesla. yesterday was april fools' day and elon musk said it's funny. he put out a tweet the tesla despite intense

efforts to raise money, including a last-ditch mass sale of easter eggs, we are said to report the tesla has gone completely and totally bankrupt. so bankrupt, you can't believe it. david: i'm not sure investors found this quite as funny. alix: they are like what you doing? mike: they had a very bad week that ended with a recall. announcement,ll the tesla bowl said tesla is testing our patients. when we were the recall news we asked ourselves do we still believe in the story, and that is the question for investors, as a company that's not making money and basically says in the out years, we are going to get there and build enough cars and people are going to like our cars and buy them and the question is, can they produce enough cars and enough buyers, which is testing investor patience. lisa: tesla to disclose some details about the fatal accident and now they have angered the ntsb come the national

transportation security board that says you guys can't do that. it's an ongoing investigation and we don't like that you disclosed information. you can add this to the concerns of how they are managing their pr and financial conditions right now. alix: it also raises the question in terms of production for their vehicles, at what point are indications so low that -- mike: they come out with the latest monthly figures and bloomberg has a really interesting thing they have come up with. an experimental tesla model three tracker, on the internet. you can see it here, basically what they are doing is looking numbersumbers -- vin and how many of those are published, to estimate how many sales they're getting per week. tesla says they we get over 2000, about 2500 or week built and in the tesla tracker is showing about 1190.

lisa: they are expecting a huge ramp up at the end, it will be viewed as an unsustainable push. pattern.is is a alix: also, don't joke you are bankrupt. david: third story involves china. when china came out with this list of products they are going to put a tariff on, this what we have. dried fruit, ginseng, nuts, wine, and pork. it's $3 billion worth, about the same amount we import in steel and aluminum from china. in the wto, you can, if you feel like you have been wronged by tariffs, you can impose tariffs of an equal amount. in theory, not until the wto judges have been wronged, but they are not waiting for that. thebig question on that is u.s. is supposed to publish his list of $60 billion in tariffs

against china for intellectual property theft. --s china do $60 million? $60 billion? they are try to target things that have political import to the president and republicans. david: this is all small beer. it's 15% or 25%, we're talking about $350 billion trade deficit. lisa: last week, the market was moreg tariff talk has been bark than bite and people are rushing back expectations for a trade war. this sort of discussion leads to a possible error, where you could end up in an accidental trade war that doesn't necessarily have a purpose other needing one chest. in the market is not prepared for that, for some kind of escalation. it has been resting back what it sees as simply talk. therein lies the issue. alix: you know it's missing? soybeans. i feel like china, if they were

serious, they would hit soybeans. mike: they are holding that in reserve for intellectual property tariffs. biggesta is the second exporter of soybeans to china and argentina has a drought going on. g #btv 100 here, argentine production is falling off a cliff. if there aren't any soybeans to send from argentina to china, china may not be able to sanction u.s. soybeans, which is why soybean prices have started going up incident down on fear of the tariffs. it's a complex problem. there was interesting article written by a news director from radio stations in a small town in iowa over the weekend. in which he said people are not paying attention to the trump scandals, people are not paying attention to stormy daniels. what people are paying attention it'ss crop prices and going to hit home. if china does anything else to the article for people, maybe trump quickly loses the voters

of iowa, not because of all the washington stuff we focus on the because of the economy and the things that the tariffs lead to. that is sum to watch. president said we will take care of the rust belt and the manufacturing people, but he forgot about the agricultural people. they are really a big exporter from iowa to china. he is really hitting a lot of his heartland. lisa: even with manufacturing, a lot of the tariffs president trump is talking about would bolster big tech companies and would speak to how some of the big companies already are doing well in the u.s., with intellectual property. or hollywood. hollywood stands to do well should there be some sort of crackdown on intellectual property theft. alix: iowa has the lowest unemployment rate and not enough jobs, what is the material impact going to be on a state-by-state basis? mike: they are in agricultural state that relies on agricultural workers, many of whom are undocumented and the

president wants to cut that off. david: we are talking about iowa because it is where the presidential race starts. the president is already thinking about -- he already announced his campaign. that's why we are talking about iowa, otherwise, i'm not sure we would be. mike: it is politically important it would send a signal of his polls went down. bloombergael mckee of and lisa abramowicz, you very much. the second quarter begins today and so, is the worst over? .e break it down with art hogan as is bloomberg. ♪

alix: welcome to the second quarter. after the worst three months for global equities since 2015, come inside here and you can see where we were in the third quarter a couple years ago. now we are in that negative territory under the month of february and march, $2.3 trillion was raised from equity values here in the u.s. joining us is art hogan from b riley sbr. how are you position for the second quarter? mr. hogan: it's a turbulent ride, we had a tale of two markets and we took off significantly in the first couple of weeks of january. a couple of different fears of policy mistakes kicked in some major volatility, more

volatility in three weeks of february than we saw the entirety of last year. we think the concerns over policy mistakes when juxtaposed against strong fundamentals that case for market that can gradually work its way higher. we have more questions than we have answers on the major concern of trade policy. fed is behind is living the concern about trade policies largely the largest concern the market. alix: rbc had a survey that the 43% of that still think that stocks are expensive. what do you think? in december, the sb 500 was trading at 18.5 times announced ratings 16.5 times, leaving earnings are going to grow anywhere between 18 and 20% -- 18% and 20% and that continues for most of the quarters.

when you look at companies, it's been very positive. you haven't seen a lot of estimates come down for 2018. that's the positive. looks multiple points cheaper as it did as early as december. that's were a strong financial argument comes in. it's concerning how much of that is adversely affected by the stakes that we make with tariffs and trade wars and nafta and all sorts of a cadre of trade concerns. if we can navigate our way through those and the choppy waters we are seeing, i think we on start focusing financials. earnings reporting season comes up in a couple of weeks. david: we want to move from the market overall to what happened with tech and amazon at the end of the quarter. a large part of the story in the second quarter was amazon seems to be out of the fray and then the president got involved. he made no signal to the fact he doesn't like amazon and over the weekend, he decided to tweet a

little bit more. he tweeted specifically that the u.s. postal service will lose $1.50 on average for each package it delivers for amazon and added that the post office scam must stop and amazon must pay real costs and taxes right now. for more, we have gerrit de vynck. get a presidential of administration due to amazon? the president has talked about amazon for a long time and the washington post for a long time. does not like jeff bezos, but by specifically talking about the usps, you can see a potential policy your putting pressure on the postal service to renegotiate whatever contract it has. we don't know the terms of that contract, it's an independent government department and it can set its own contract with private actors like amazon. if the usps has somehow managed to renegotiate some kind of contract and pulls more profit

out of amazon, the rest of the market could move in costs will go up. david: the u.s. postal service loses money overall. do they lose more money on amazon than they do other people's packages? gerrit: amazon says the usps is profitable on his contract. we don't know specifically how much. it seems like they are making a bit of progress. with a noteame out defending amazon saying amazon does not trade on short-term earnings estimates anyways, so even if the sales tax went up when they got hit on the margin in some capacity, that is not why investors buy this stock. david: we all believe that amazon could just decide to turn this bigot on and make money if they wanted to. does this really -- turn of the spigot on and make money if they wanted to. does this really matter? gerrit: it makes it more, get it to turn on the spigot later down the road. amazon traded the way it is because of a dominance in

whatever industry wants to go into. alix: but you need tech to get back the money we lost in the last two months. bloomberg's gerrit de vynck and r hogan, you are speaking -- art hogan. making possible bankruptcy and april. but investors don't find that funny, with the price of the stock and bond falling. more next. this is bloomberg. ♪

leinz:his is -- kailey this is "bloomberg daybreak." the company isn't saying how much it paid, but it says the deal inspired an enterprise valuation of $9.5 billion. alibaba only -- already owned 33% of ele.me. bahrain says it discovered its biggest oilfield sends a began producing fruit in 1932.

the smallest energy minister in the persian gulf says the shale oil and gas well with discovered of its west coast and bahrain's official news agency says the find dwarfs the country's current reserves. a sensemusk still has of humor after the worst month for tesla shares in more than seven years. electric carmaker ceos said april. it's joking about the company going bankrupt. despite quote a last-ditch mass sale of easter eggs. shares of tesla fell 22% in march and movies cut their credit rating into junk status. is taylor. alix: he says i'm going to miss them up and sent out a tweet. david: he reminds me of another very wealthy person in washington who doesn't want any checks or balances. very wealthy and they want to do whatever they want to do. alix: but he doesn't have any bond or stock that's going to have a big impression on that. david: he has a whole country. alix: the entire s&p at the end of the day.

elon musk may be joking about tesla bankruptcy but one thing is no joke is what's happening to the company's credit. benchmarksla's falling off a cliff and now we see the price slipped below $.87. joining us now is molly smith, corporate finance reporter. walk me through the drop. investors loving tesla bonds. been from thes start wondering why would you buy a company that makes no money, especially in bond world, when you only care about getting paid back. it's all you are negligent investor and carrier -- it's not like you are an equity investor. fearslly put all these right in the center spotlight again. we come this week on the production figures which everyone has their eyes on. david: this is a real consequence if you own a tesla bond. real consequence to tesla, because the need to raise more money. they need to go back into the

market. molly: it makes you wonder how are they going to do it next? yuan has been so creative -- elon has been so creative in raising money and that's what investors are looking at next. they seem to think a secure bond sale would be next, leading some of the bonds against the factory where all the value would be for the bond holder. and it would give you some more comfort going into that. alix: is that kind of bond for the giga factory? molly: this would just be a secured bond sale. right now, in unsecured, you are not really getting -- you have a claim on nothing. the only thing that's below you is the equity, which isn't doing that great either. david: they have been able to stay ahead of the sheriff by selling the option to buy the model three. if the numbers come out there, if they are disappointed once again, it's one of a harder and harder to get the next group of people, whether it's on trucks or cars, to put up money against

the possibility of getting a car or truck. molly: that's when the struggle so far. how do you sell the story that the dream is out there and elon is out there, he is selling the charm to investors. but there still has to be proof of concept, are you going to hit that target of however many model threes a week that it's going to be an right now that is the main question. is this going to be a massive vehicle or can you really had those numbers? alix: molly smith. .lso joining us is art hogan this raises questions in terms of the tesla bond, is an idiosyncratic issue or what we see in aftereffect reverberate in the junk bond market as well? mr. hogan: great question. one of the things we have been thinking about and the fixed income market is how much pressure comes to the fixed income market as we see interest rates gradually rise area tesla has been looked at as a completely separate situation. , difficulty ind

getting number three is out -- model threes out. they need to raise capital. is a company that has a massive vision for the future, but in the current era now, has a lot of issues with keeping enough capital on the balance sheets to be ongoing issue. i think that we think about tesla, you have to separate that from the rest of the high-yield bond market. i don't necessarily a symptom of something larger, but something we will keep a close eye on. the triples go into b market, there was a piece this morning you saw about how dramatically the amount of triple be outstanding has gone up. shows the1 which yield on the triple b's right now. it's jumped up quite a bit. is that indication that we should be concerned? mr. hogan: i think that one of the things if you back that chart up and look at all of 2015 and 2016, they were probably yielding much lower than they should have an creating some

issue. i think all that had to do with the fact that in 2015 and 2016 and most of 2017, we are searching for yield and any cost. that's what we saw most of the bond surrogates in the equity markets get overpriced, whether it was utilities are staples or telecoms. i think that danger in the midgrade fixed income market is the same thing. i think it is getting rationally priced now. alix: art hogan is staying with us and also, issuance, tons of issuance of triple b's will have an influence. we are watching tit-for-tat, china enacts tariffs in response to president trump submittal tariffs. we discussed. this is bloomberg. ♪ retail.

under pressure like never before. and it's connected technology that's moving companies forward fast. e-commerce. real time inventory. virtual changing rooms. that's why retailers rely on comcast business to deliver consistent network speed across multiple locations. every corporate office, warehouse and store near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver. ♪ alix: this is "bloomberg daybreak." welcome to the second quarter. trader,re in a goodie you are playing defense. a you trade anything else, you are probably napping.

-- if you trade anything else, you're probably napping. the vix remaining elevated over 21. its test quarter since 2016. european markets are closed for the day. yields moving modestly higher here. below 50's it really took flattening pressure last week. the dollar also flat on the day. i am watching crude. across 170. way i am interested in this because of bahrain. you never want to see a headline like "lots of oil here" if you are a bullish oil trader. david: when i read it yesterday, the first person i thought of was you. i asked if it was real, because it sounded like a huge deal. let's get an update on what is

making headlines outside the business world. kailey: in north korea, you could call it k pop diplomacy. kim jong-un angled with stars of concertet after a rare in pyongyang. the surprise visit comes one historic visit. the president threatening again to pull out of nafta if mexico does not stop people and drugs from flowing into the u.s. the president also says border patrol agents are not able to do heir job because of what calls ridiculous liberal laws from democrats. china is urging more trade talks with the u.s. agency says the u.s. did not respond to its request for consultation on new u.s. steel and aluminum tariffs. global news 24 hours a day, powered by more than 2700

journalists and analysts in more than 120 countries. i am kailey leinz. this is bloomberg. david: thanks. china made its next move, ofosing tariffs on a range products like ginseng, nuts. that is about equal to the steel the u.s.num products is taxing now. joining us is erin ennis. a this chart villagers the overall issue with the u.s.-china trade deficit, and at the same time, it does show that the total deficit is $350 billion, and that tariffs will total about $3 billion for the product it is this just a symbol? erin: probably not as much a

symbol as an equal and opposite reaction to what the united states is doing. the estimate of what the cost of tariffs are on chinese steel and aluminum that the administration is pursuing separately is equal to roughly $3 billion, thus the tariffs china is putting on is an equal and opposite reaction. david: is this perhaps going to a compass what he wants? he says -- is this going to accomplish what he wants? curtail thectually imports of steel and aluminum, even if he does hurt the united states and agricultural products, has he accomplished his goal? imports the concern is of steel and aluminum, we are doing a good job preventing it. the terrorists are quite high, and china, the number 11 importer of steel into the habit states, and low in aluminum as the -- putting tariffs on

imports of chinese products in this category will not do much for what we import. alix: when we talked to investors, they say we will have to wait and see how this plays out. however, this is the backdrop of a global, synchronized recovery seeming to slow in europe. can you pair these? question.is a great that is the right way to look at it. in terms of thinking about trade deficits with individual companies and making unilateral tariffs andtting possibly starting trade wars, all of that protectionism wraps itself around bad economic theory. what the unintended consequence could be is we have an economic slowdown right when we are getting developed juries -- countries and expansion. we could win the battle and

lose the war, because what we are dependent on is global economic growth. when you think about the fact that 50% of the s&p 500 has more than 50% of its revenues internationally, we do not want to slow the global economy down. what is more important in this narrative is nafta. the conversation coming out -- the statement coming out over the weekend is dangerous. nafta negotiations are the most important thing right now. we can figure things out at the negotiating table with china, but right now, we have to renegotiate nafta. david: is there any risk -- let me put up a chart. g #btv 9974 -- alix: your rattling off the chart name. david: i am a whole new guy. this is china pmi. you can see there are well over

51. it is showing they are still expanding over china. is it likely anything we do will slow them down? erin: certainly there is a risk that what we do with our largest trading partners could have an -- what willt are happen. the chinese telling the pakistanis that they would continue to import as much product as they have, even though it is largely inputs. that suggests the chinese think they can whether a storm -- ew ather a -- weather a storm. alix: but china still has some big levers they can pool. -- pull . and potentially devaluing the yen. what are the chances china could take that action? isn: the issue with soybeans a real one, as are other large

categories of u.s. exports. aircraft probably the second largest category after agriculture products. the risk is there. whether there is sufficient volume in the markets for all those products china is currently buying from the u.s. is an open question. we should keep in mind that we put $3 billion worth of tariffs on the chinese, and china responds in kind. the u.s. administration says it is looking at $50 billion in its case on intellectual property rights -- that is a much larger risk. you will have to have much higher product values to make that value. alix: our markets are properly priced for that? particularly the vix. ccrv looks at the vix curve. the orange is where we are now. the green is very were a month ago. yes, we have seen more volatility in the near term then the long-term. what do you make of that? art: you ask the right question in terms of where we would go

from here. the one you did not mention and the one we should be talking about -- we have a lot of treasury issuance coming this year. china is a large holder and has been a large fire. when we think about how much the market is priced in, i do not think we have gotten to a point where the market has christ in an all out trade war with china. the reason is we had been a pattern of the trump administration making announcements, and then backing off and heading to the middle ground. very much like we saw in steel and aluminum tariffs. it started off as a blend -- blunt and she meant against all of the countries in the world. it is a difficult needle to thread. investorst about what and companies are doing in cross-border interactions? is the possibility of trade

disputes affecting business behavior? erin: i do not think we have seen affect is this behavior yet, but that day is coming. the reality of a $3 billion tariff that hits a couple of sectors like agriculture and steel, that is different than broad tariffs on a wide friday of imports from china that china would respond to in kind. what we're hearing from companies is they are waiting and seeing. definitely a strong desire for dialogue rather than moving towards tariffs, but we should anticipate that if dialogue does not happen and if china and the u.s. are unwilling to even sit at the same table, we are talking about a whole different world. david: i do not want to let you go without going back to the issue you raised -- nafta. right now, the president more just to in nafta, tweeting this morning that mexico has to do ,omething about the border shutting down the parade of

people coming across. why are we worried about that now? that was the hope in the marketplace, that negotiations continue. word was coming out that negotiations continue, but we are heading in the right direction. then you get this off the cop comment -- off-the-cuff comment. the nafta agreement should not be mentioned in the same sentence as building a wall or having security with mexico or daca, for instance. unfortunately, there was a lot to unpack and the off-the-cuff statement. hopefully, this is a process that continues to move forward. it will be much more important near-term with our largest trade partners, mexico and canada, versus where we will end up at the end of the day with china. hogan,erin ennis and art thank you both. equityhile you have

traders on the defense, we wind up having big movers and the market as well. humana up 7% in premarket. walmart down by 1%. could they be in early stage talks for a merger? $50deal could be valued at billion. very interesting number coming out. will it give it enough firepower to combat other mergers in the health care industry? humana has a big portion of medicare patients. have been watching tesla. shares down for five straight weeks, marking the worst time for this company since 2010. what can elon musk due to restore confidence -- and not tweet that the company is going bankrupt in an april whole -- fools' joke. unless people think --

unless we have not talked about his other tweed, about him being valid drunk with tequila -- being found drunk with tequila. alix: what are you doing? david: aspiring to be a standup comic. as the future of deutsche bank's leadership comes into question, a failure -- a familiar face may come on board. turn to radio. you can hear them in new york, boston, the bay area, washington, d.c., and across the u.s. on sirius xm radio. this is bloomberg. ♪

♪ kailey: this is "bloomberg daybreak."

i am kailey leinz in the hewlett-packard enterprise greenroom. coming up, paul christopher, wells fargo investment institute head of global market strategy. ♪ your bloomberg business flash. walmart and humana may be facing different threats with the same solution. a person familiar with the matter said the two are considering a closer relationship. amazon has taken aim at walmart by siphoning customers out of its stores pay meanwhile, humana's rivals are creating deals to create one-stop shops. police across the country have rules for drivers to use electronic logs. 28% thisges are up

year. and steven spielberg has given warner bros. its first number one debut of the year. science-fiction thriller "ready the boxne" topped office in the u.s. and canada. warner bros. ranked fifth in ticket sales among the major ticket sales going into the weekend. alix: thank you. return to wall street, covering three things wall street is is about. first, deutsche bank repairs to shake up its -- prepares to shakeup it board. harts fund is-- ein down. is peggyining us now collins. -- who may goth on to the supervisory board of

deutsche bank. >> he is a storied person on "wall street journal workout goldman sachs. took merrill lynch through the financial crisis, and it looks toe he will be tapped shakeup the supervisory board at deutsche bank to try to help save the bank. it has struggled to claw itself back. there is a lot of reports that ceo cryan -- investors and people in the company are not happy with what he has been doing. david: if you want an experienced banker, john saying -- thain is one of them. peggy: he is known in terms of merrill lynch when it was getting bought by bank of america. he got a lot about press the time, but then he was at cit and executed a turnaround. alix: if you are john thain, are

you happy sitting on an advisory board? i certainly do not know. i know john thain some. but i am not sure if it is either/or. it would not be the first time they brought someone on board -- that is what happened with ford. was brought onto the board and ended up being ceo. peggy: and this board essentially overseas people on the board and management. alix: and we love talking about hedge funds. that leads to our second topic, which is david einhorn. 14%. losses so far -- you think you would have done better, especially since stocks got him at the last two months. thursday and friday, we

were thinking he would do better, because some of his bubble basket of tech stocks really suffered in march. amazon.com, netflix, but it still came in down 9.1% in march, bringing him to a 14% loss for the first three months of the year. david: it is not just tech. negative on. he is shorting tesla. alix: so is this long for him? peggy: he is -- some of his long picks have not done well either. he is kind of getting hammered on both sides. february, he said in a call with investors that this is the worst performance the fun has ever seen, but we really -- he really stock with the growth strategy -- he stuck with the growth

strategy. this has really weighed on the firm. alix: what i find interesting -- we love to talk about hedge funds. in reality, the first quarter should beware hedge funds outperform. they do not necessarily need to be the benchmark, but this is why you own hedge funds. when you have all of this volatility, the vix spiking up to 30, and have these losses, that is why you should be investing with these guys. david: he is known for making big bets, particularly on the short side. peggy: on the short side, it has been hard for hedge funds. they are the ones who are supposed to be doing better when the overall market is down. alix: down at the 1% in march -- that is better. if you are buying a bunch of material stocks. david: third story -- ubs. we know ubs for wealth management. they are number one in the world in that he had now, they decided we would like a better deal from

you money managers. peggy: this is really interesting for me. i thought to myself this is another ripple effect of this dramatic fee pressure people are seeing across the industry. wet you're seeing ubs say is consolidated wealth management division's across america and globally, and we will take that and say to find and edgers, you need to cut us a break, because we are basically the amazon of wealth management. we are seeing this across the board in terms of money managers. for a long time, money managers had regional funds on their platform, and it was a detente in revenue share, but we are saying this -- seeing ubs put pressure on. david: everyone ones -- wants to get into wealth management big time. is there a competitive

disadvantage if they really try to shave too much off the fees? do they run the risk of a fund manager saying we will not work with you anymore. peggy: my instinct is to say no. the pressure on sees is so widespread. and because there has been some consolidation among the biggest players of wealth management. we have seen deutsche bank contract. globally, people are in a position to go after asia, the new frontier. but there is pressure from main street investors to investors like ubs. david: thanks so much. bloomberg's peggy collins. coming up, $5 million payment -- sorry, 5 million people have their header card information compromise. hudson bay says they are the latest to get their data breached. alix: and check out tv .

watch us online and click through our graphics. go to tv on your terminal. this is bloomberg. ♪

♪ i am: this is what watching today. hudson's bay. a story broke over the weekend that as many as 5 million people who have credit cards from hudson's bay have data breached. the target was 40 million people. under armour had a thing with their fit process. this is sinister, because they have all of the credit card information, and they are selling it to people. people can buy -- in fairlness fraudulentaces any transactions, we will cover for you. a good point.e

it is not the fact that this is happening. it is how the company manages it. it orx did not disclose did not have a good rollout, and investors freaked out. do not know yet -- they admitted there is a problem. they say they are fixing it. but a lot of information is coming from a third party called gemini advisory, a security firm. it is not coming from hudson's bay. alix: good thing i do not shop at saks. up, one take on the first quarterly loss we have seen since 2015 -- this is bloomberg. ♪

♪ alix: more bankrupts -- just

kidding. you with an april fool's joke. -- elon musk with an april fools' day joke. and camtek find its footing? china standoff. beijing slapping higher tariffs on u.s. products. david: welcome to "bloomberg daybreak." i am david westin, alongside alix steel. a good day because alix is back. alix: good to see you. but we are not in d.c. on an easter egg hunt. david: this has not started yet, as i understand it. it is a vast thing. lots and lots of kids do this. alix: imagine taking a toddler there -- she would have no idea where she is. just throw stuf. that, you can do actually. the kids will be kids. it is sweet. it is a nice tradition. they do it every year. alix: if you are a market

participant and an equity trader, not as nice. you are on the defense. other asset classes are at home. euro-dollar on the high end, up by 1/10 of 1%. print. how we yields higher in the u.s. on the margin, up by about two basis points. two-ten curve is also steeper, but it is, as they european markets close on oil. david: tomorrow, the fed will reveal its candidate for sofor. rateith the unemployment 4% friday?all below

and there may be another round of responses from china. , ax: after a volatile start new quarter begins. for is the quarterly change the s&p, down 1.2%. has not seen a law since the third quarter of 2015, when we closed below 5%. joining us is luke kawa. and paul christopher. great to see you both. walk me through the anatomy of the first order loss -- quarter loss. us fromch stocks kept having a bigger loss. when you couple that with the consumer discretionary linked to amazon, netflix. one inow, i think encouraging sign, if you are a , yields were- bull down thursday. they were down on the week for

the 10 year. if the banks, struggling with lower yields, and utilities moved up together. of exhaustionsign in the banks. alix: good point. in health care, energy, and financials -- where would you buy the dip? paul: definitely in financials and health care. we also like this a good calls. industrials and consumer discretionary's. industrials had a tough time in march because of trade war talks. so on the one hand, what happens with the trade conflicts -- on the other hand, what happens with the tax cut affects on earnings, which would you pick? paul: tax cut affects on earnings would be stronger. they were not noticeable in the first quarter. that is because we are just

getting started with the aid hundred billion dollars total fiscal stimulus. that should weigh heavier and the second quarter. alix: tech -- fundamentals versus sentiments. over the weekend, the president had a pair of twitter messages -- he said the u.s. postal service will lose $1.50 on average for each package it delivers for amazon and added a post office scale must stop, amazon must pay real costs and taxes now. tech had been the underperformer the last couple of months. if you come inside the bloomberg , earnings estimates are still good for these companies. the white line looking at 29% earnings growth, despite the fact we have seen a recent pullback. which wins? luke: that will be the question of this quarter. at theselooking earnings but maybe earnings down the road. amazon, apple,om

when we look at not just earning estimate for now but the quarters that follow. by the end of the year, for the apple consumer group, revenues taperg to 2.2% and really off in the years to come. maybe in this quarter and in the near term, fundamentals went out. appleg further down, both and semis, revenue growth is not expected to be that strong. david: take us into the tech phenomenon. first, you had facebook. then you have the president weighing in about amazon. is it all our regulatory issue -- is it all a regulatory issue? paul: it is going to be a question of regulatory issues and competition from other sources as well. also, people will have to figure techhether or not these and the extrapolation

into how it affects our alive, will it continue? doubt that reason to now. that is not unusual with the disruptive change in the economy. for traders, it is going to be a tough environment. the trajectory is still positive. the earnings, we think, will be good and these will be buying opportunities in tech. david: earnings were good, but what about valuation? it was fully bought before. do you think now it is a bargain? paul: we are happy to be market weight in tech. we thought valuations were a little rich, but we love the earnings story. we will have to see how quickly investors come to a new balance between the forward look, the expectations, the extrapolation, and the realities of competition , regulation, and other things that have to be factored in. alix: there was a report out --

in a survey, 43% still say markets are expensive, opposite what you would have thought with the recent selloff. luke: it is surprising. i do not know if going from 40 times two 30 times to 20 times, but if you look at the premium or forward pe of tech versus the , it is a large premium, but it is nowhere near as bad as it has been in the real growth overvalue scenarios, where we really need tech to carry the weight and expect them to carry the weight. but there seems to be a disconnect. serverth that with the best survey saying that expeditions for early growth were out -- a 20% correction rally completely

flip-flop. alix: that brings us to volatility. this is the volatility returning to the first quarter. the most in the first quarter since 2011. are we going to continue to see the vix climb higher? is it the new normal? you want it to be. one thing that was interesting was it was localized to equity volatility. but family management point out this was the first quarter since q3 2008, i believe, that both stocks and bonds, the bloomberg u.s. aggregate index, fell in the same quarter. it was like there was nowhere to hide. that is kind of reflected in how bad it was for stocks. that is the question -- does this pick up, and do earnings suit the market and make it a smoother ride? david: let's come back to this

specific question. wage prices cut into margins, which could affect earnings -- how dangerous is that? and what about the fed? paul: we think wage growth will remain a nine below 3% going forward, at least for this year. that is a low ability to -- into margins. eat as far as the fed, there was some uncertainty around chairman powell's first meeting and press conference. that is not unusual. you have a new fed chairman. all of the words have to be parsed, and they are looking for nuance all the time. the main thing investors should focus on with chairman powell is he is much more data-driven and less prone to be philosophical then chairman yellen. that is a good thing for investors, because if the data remain solid on the economic side with low wage growth and low inflation, that will mean a

very gradual fed. we think the market can extend into new highs as a result of both. , thanks.ke kawa coming up, tesla racing the clock. the carmaker trying to ramp up model three production before quarter reporting. this is bloomberg. ♪

♪ kailey: this is "bloomberg daybreak. i am kailey leinz with your bloomberg business flash. alibaba is buying start up ele.me. $9.5plies a deal of

billion. alibaba already owned 43% of ele.me. a u.s. trucking shortages about to get worse. police have begun enforcing rules requiring most big rigs to use electronic devices to record driver hours. those will prevent drivers from fighting hours on paper logs. that means more trucks are likely to be parked when drivers hit their 11 our daily limit. and elon musk still has a sense of humor after the worst month for tesla shares in more than seven years. the ceo sent april fool tweets joking about the company going bankrupt, despite a "last ditch sale of easter eggs." last week, moody's cut tesla's credit rating further into junk status. david: let's keep talking about elon musk. he may be joking about tesla

going bankrupt, but the fate of the company keeps going back to the basic question -- how fast can it produce cars? hasuction on model 3 improved, but it is a far cry from the target of 2500 cars a week. joining us now is jamie albertine. he has an overweight rating on tesla. good to have you here. first, give us a guess about when we will know the numbers. when will we get new production numbers? can you hear me? jamie: yes. good morning. david: so when do you think we will get numbers on model 3 production? jamie: today or tomorrow is what most people are expecting. it usually comes a day or two after the quarter is over. david: are you resigned to the fact we likely will not see 2300 a week -- troy 500 a week? jamie: i am.

our expectation is that the whisper number is somewhere in the 1700 or 1800 per week range. to the extent that they can show they are making significant weekess from the 1000 per number, it is good news. david: i am much of a have ever made their numbers in production. jamie: elon tweeted yesterday -- in very poor form -- so if you can figure out what makes elon t out youran figure question. they are embarking on something that is truly a lot more complicated and involving been even they assumed a few years ago. the automation in this facility beh the model 3 is going to best or near best in industry. difficult toidance provide. again, trajectory is what matters. they are well on their way to

2500, making their way to 5000 sometime in the back half of 2018. david: if they come out between 1700 and 1800, it will that be enough for the market. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. shows around one third of their debt outstanding. it was cruising in the high 90's. then after the downgrade, it has gone down to 87, trading at $.87 on the dollar. 1700, 1800, will that be enough for the marketplace to give them more cash? jamie: there are two questions. the first is if they hit 1700 or 1800, will they need to raise capital, and how soon, and will they be able to? i think being within striking distance of 2500 near term, there is not a great need to raise capital. but the bond action is the most

notable of all of the headlines. if you look at news of versus noise, that is definitely news. i am not a fixed income focused strategist, but there is a lot of noise around other issues that may not be tesla specific. you the way, if they hit their numbers, that is the first and foremost focus for investors, and that will solve the capital questions people have today. albertine, thank you. paul christopher is still with us. in there are libor issues the debt market, but it sure looks like tesla buyers are responding to the moody's downgraded. is it an idiosyncratic issue or does it spread in the high-yield market? paul: there are some issues in the high-yield market. there are some bbb's. there are a lot of companies that raised cash through debt. some of them have lost credit ratings.

there has been a lot of volume of debt. what we're seeing now is from bbb's on down, a tick higher in yields, in spreads, and when you put that with the libor, the widening of that spread, some people have started to suspect may be there are funding problems going forward. we think that is premature and is sort of a reflex reaction to memories of 2008. but once we get to recession in a year or two, those will be critical issues that will probably lead the recession. alix: but many also say they move we have seen higher in libor is a short-term phenomenon and will not continue. can you say the same for bbb's? paul: probably not. you will see those leading indicators heading higher ahead of the next recession, but it does not have to continue in a straight line, wider spreads, back to the -- between now and

then. we see the 10 year come down more. and loweree the bbb's yields come down, just in the normal course of the economy's function to europe there was a big inflation shock in the early part of february. that is why bond prices for the quarter as a whole seem lower. we will not have that inflation shock continuously through the remainder of this cycle. alix: paul christopher -- david: paul christopher will be staying with us. coming up, more on humana's possible deal with walmart. this is bloomberg. ♪

♪ david: consolidation is the order of the day in the health care industry, with cigna buying express scripts and cbs -- cvs buying aetna.

now, humana could reach a deal with walmart. joining us now over the telephone is steven halper, cantor fitzgerald managing director covering research, i.t., and health care. he has a neutral rating. explain this deal to us and how it fits with all of the other deals being done in the health care industry. steven: sure. and thank you for having me on the show today. our comment this morning is if c vs can buy aetna, i guess walmart can acquire humana. is andding aside, humana attractive asset, with 19% share of medicare advantage across the country. there is some obvious synergy, as walmart can conceivably try to drive humana membership to

walmart stores. remember -- walmart is a major player in prescription pharmacy already. they have about 5% of prescription market in the united states. david: you already have cigna with express grips -- scripts, maybe humanas, with walmart. where does that united health? steven: united health is already well diversified within the insurance markets. it also has made significant investments in its optum unit. we do not believe united is going to be acquired. in fact, our view is, over time, as we published in our research reports, is that united has been so good at acquiring different businesses in order to achieve the nice diversification. to some degree, humana is mainly

focused on medicare advantage. it is a strong growth market, and that is why we believe walmart would be interested in humana. that being said, united is already larger than humana and the medicare advantage market. alix: what kind of premiums could we be looking at here? steven: it is hard for us to try to estimate what sort of premium it would be. the stock, currently, trades above our price target of $2.50. and our price target is based on fundamentals. if you go back to in a half years ago, -- two and a half years ago, aetna was going to buy humana. things have changed. humana has done a good job of eliminating losses from individual plans. there are media reports suggesting a 20% premium on top

of the 2.68. but at 23 times earning estimate, that seems expensive. again, that is speculative. we cannot assign any probability of that getting done. alix: but this chart shows why you may pay it because of the exposure to medicare. paul christopher is still with us. does this make you want to go out and short all hospitals at the end of the day? paul: no. we still like health care overall. we think this is a source of competition for some of the that tech driven companies will get into the consumer discretionary and health care space. this is how competition ramps up. it will give investors something to think about in terms of big tech and those companies going forward. alix: paul christopher, you are sticking with us. 145 deals so far in healthcare services this year. david: and you wonder about

amazon -- berkshire hathaway jamie dimon, and whether that they be triggering this. alix: and does amazon affect how you have to pair up, although i wonder if a lot of health care manufacturers shop at walmart. david: i guess a lot of health care people shop at walmart. alix: let's call it tit-for-tat. china slapping higher tariffs on more than 100 products after the u.s. ignores their request for more trade talks. this is bloomberg. ♪

alix: this is "bloomberg daybreak." i am alix steel. s&p futures down by 11 points.

dow jones up triple digits. the vix remaining elevated, over 21 at this point. the nasdaq the biggest loser. you have most european markets closed. 10-year yields moving higher by three basis points. more selling on the market -- margins. below 50 after the curve got pummeled last week. it is a mixed dollar story. commodities moving higher, not participating in the risk-off deal. she is here with first word news. experimental space station has fallen back to earth over the pacific ocean. get mostly burned up during reentry.

it's scattered in pieces over the southern pacific. kim jong-un mingled with the stars of "red velvet" after a rare concert in pyongyang. his surprise appearance comes a month before the historic summit. he is also preparing for an unprecedented meeting with president trump. north korea will be on the agenda when president trump meets with prime minister shinzo abe later this month. the white house says they will discuss the international campaign to maintain pressure on kim jong-un's regime. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. david: thanks very much. we will get u.s. jobs numbers on friday. investors may be more focused on u.s.-china trade relations.

the tariffs are expected to total about $150 billion. we welcome back michael mckee and paul christopher is still with us in st. louis. let me start with this chart. this is the trade deficit with china. yellow is the overall trade deficit. the blue line is how much we import. , whether it iss $350 billion or $50 billion, doesn't have any material effect on the trade deficit? >> it does not. especially the tariffs the u.s. and chinese have exchanged over steel and aluminum. $60 billion would not be much either. it is a question of the individual impact on states in the united states and with

companies. if they impose tariffs on apple products coming out of china, apple gets hit hard. we will be interested to see t the price will be. they said $.25 tariffs on pork products. people in iowa will be interested in what happens. david: you mentioned apple. it raises the question whether we measure if the right way. the apple phone gets designed in silicon valley and manufactured around the world. and yet, we bring it in as a nominal value. michael: trading relationships around the world have changed because of the production change. apple designs the iphone in the united states. components are made around the world.

they are brought to china and put together. the value out on an iphone is about 4%, but it counts as an import from china. the issue is how you measure that and how you measure services. we don't have good figures on that. service surplus with china and the rest of the world. that is not measured properly even though we have become a service economy. it is difficult to just look at the goods deficit and say this is all there is. alix: paul, how do you hedge this? paul: the tariffs? alix: yes. paul: short-term, there is not much you can do or want to do considering there is not much impact on the overall economy. there might be some sector impacts. some sectors will do well while others do not. a portfolio should have small and mid-cap exposure.

they will do well. if you are looking for one way to hedge, take small and mid-cap exposure to long allocation weight. this will probably have adjustments over time. the chinese will find other ways to lower the cost of assembling components. that will help to offset the tariff itself. this has happened in apparel for a long time now. alix: it is the appetizer. the main course is what the u.s. will do about intellectual property. here is what the commerce secretary had to say last week. >> the purpose of the whole thing is to try to curb the problems we have found with intellectual property rights. forced technology transfers, forced partnerships. that kind of thing. forced licensing. cybersecurity breaches. all sorts of problems designed to penetrate the intellectual

property rights of american high-tech companies. tox: what is the u.s. going unveil this week? michael: they will have a list choosing from 36,000 products of things they could put caps on -- tariffs on. china put out a list of things they could put tariffs on in retaliation for steel, and they followed through on that. it gives the chinese an idea of what is coming, so they put together their own list of retaliatory tariffs. wilbur ross is right. the rest of the world agrees china is playing unfairly. the general feeling is a multilateral approach where everybody puts pressure on china would work more effectively than a unilateral approach which is what the president has chosen because the chinese can come back and put tariffs on us. if they had to put tariffs on the world, they would be in trouble. it is at the core of a

lot of chinese economic development. to think we will put tariffs on even $50 billion, 25%, is going to change their behavior is far-fetched it seems. jinping is in charge. he will not want to be seen as backing down in the face of u.s. pressure. they put together this list of high-tech products you want to lead the world in -- they want to lead the world in. they have been stealing intellectual property to get there. that is what the u.s. will be putting tariffs on. that means the chinese will look at our high-tech industries at well -- as well. david: the president says he is doing this to help industries. are there winners, places you would be more inclined to buy in u.s. stocks because of these tariffs? paul: the small and mid-caps have outperformed during march

because people expect those mostly domestically oriented companies to benefit clearly while the trade skirmishes continue. it is not clear where else you might see small tariffs imposed going forward. that becomes more of an issue. if you think those tariffs are going to be significant going forward, we don't necessarily think so, we think the chinese are already moving in the direction of moving away from big, polluting, nonprofitable manufacturing industries. they would make concessions to the u.s. on buying more u.s. products. we don't think this will turn into a trade war with china. if you are looking for a way to hedge or something else to buy, take those small cap exposures to where you would like them to be in the long-term. alix: this is happening on the backdrop of what some are concerned about, weakening global growth. look at this pmi globally.

the white line is the u.s. holding up well. european, disappointing data. backdrop.e if we are no longer in a global synchronized growth story as we thought we were six months ago, how does that factor into the trade conversation? michael: it makes people nervous about earnings potential going forward. the world will not fall off a cliff. some figures may slow down. we are expecting the ism numbers in the united states to come out weaker today. you will see a gradual cooling off. that is something to keep an eye on. the impact of these things. the good news is china says it still wants to continue negotiations. does the administration? interesting question. alix: indeed.

if we see some leveling off of economic data, where do you want to be? you want to to be in europe and japan. do you still want to be there or will the u.s. become more attractive again? peaking in maybe a some of these -- alix: it looks like we had technical difficulties. do you have more assets coming into the u.s. like we saw a few months ago? michael: investors at least have something to that on. that is fiscal stimulus, that it will boost growth as the year goes on. even if we have reached a peak in a natural cycle, maybe we get an extension europe and asia do not get. david: michael mckee, thanks for being here. paul christopher, it was great to have you. ahead of tonight's ncaa championship, who is playing? michigan and villanova.

we lead with michigan on this program. we will speak with lee berke, c.e.o. of lhb sports and entertainment. tom from 9:00join to 10:00. it can be heard across the united states on sirius xm radio. live from new york, this is bloomberg. ♪

alix: this is "bloomberg daybreak." i am kailey leinz. coming up later, the causeway management c.e.o.

and now to your bloomberg business flash. mark zuckerberg says it will take a few years to solve facebook's problems. it is not true facebook only cares about people who pay. facebook has been hit with controversy. since hitting its peak on every two, the market value has fallen by about $100 billion. there is a missing are both buyers and american car dealerships. sales to those with subprime credit scores fell by 9% the first two months of the year. deliveries were flat among those with the highest credit scores. merchant auto sales may have been the worst in five months. we will find out tomorrow. steven spielberg has given warner bros.'s first number one debut of the year. "ready player one" took in more than $40 million to top the weekend box office in the u.s.

and canada. that is your bloomberg business flash. david: thanks so much. march madness comes to an end tonight between michigan and villanova. last year, the tournament generated nearly $1.3 billion in advertising revenue. how will this year stack up? from lhbs is lee berke sports. give us a sense on the tournament and how it has done in the ratings. >> extremely well. a lot of cinderella stories. a lot of buzzer beaters. sister jean. all driving ratings, all very successful so far. david: how does this finals stack up? michigan is not a big market but has huge alumni.

>> southeastern michigan, detroit, a large market. villanova a large market. two big conferences. you have a lot of solid teams going up against one another and solid fan base is that can drive ratings. david: it is a lot of fun for a lot of us doing the brackets. our cbs and turner making money? >> they profess that they are. david: every network has claimed they made money on football, basketball, baseball. >> they put their money where their mouth is. they did a renewal of the deal in 2016. eight years, $8.8 billion. $1.1 billion a year. 64 games. for are paying $17 million rights fees per game. they are willing to do it because they feel they make it back in advertising and fees. david: $17 million a game.

that is not just for the finals. that is for the whole tournament. what do they have to clear per ad? >> probably $400,000 per 30-second unit. here is something to be aware of. you have a partnership between cbs and turner. turner has this on three separate networks, primarily v.s, but also tnt and trut map untilnot on the they started putting on ncaa games. driving sub fees as part of their overall financial relationship. cbs to watch to michigan. it was not there. i went to turner. in the past, you had early games on turner. semifinals were on turner. >> they are taking up part of

the financial burden. for a long time, cbs had this solo. they said they needed a partner and turner stepped up. david: there is a fundamental difference in bookkeeping. broadcast network has to make revenue per game. cable can say it goes into the sub fees. onht now, it is helping us the price we are charging at&t. you cannot figure out if they are making money on it or not. >> >> since the deal started, cbs has gone all access with over-the-top service. that has been tremendously successful for them. they have approximately 2 million subs. they are getting sub fees going forward. that is a way to potentially cover the cost as well. david: let's turn to golf because the masters starts thursday. there is a big name back in the masters. that is tiger woods.

how big of a difference does he make to sponsors, readings, cbs? >> he drives the overall viewership and success of this tournament and the industry. a lot of golfers may not want to play against him, but they are thrilled he is back because he drives ratings. everyone wants to see how tiger is doing and how successful he is going to be. you have a lot of great golfers coming together for the tournament. this upcoming weekend that will drive ratings and help the industry in general. david: they need him to make the cut. >> absolutely. they want him there saturday and sunday. david: a great sports week. we are reaching for michigan, right? alix: yes! are you going to have no sleep tomorrow? david: i don't think i can do it. i will watch the first half. it will be hard to miss. alix: we will be tired tomorrow. david: lee berke, thank you for

being here. alix: take a look at sporty movers. fitbit getting crashed premarket. morgan stanley says the new devices are not enough to offset the drop in legacy products. they say the company could keep burning cash. under armour slightly lower today. another data breach over the weekend. they say no financial data is at risk. goldman sachs and lord and taylor also reporting a breach. coming up, first energy filing for bankruptcy. it puts the trump administration in the hot seat. they have to decide if they will l and nuclear power plants. you can click on charts and graphics and interact with us. check it out.

this is bloomberg. ♪

alix: i am watching the bankruptcy of firstenergy. this is the debt maturing in 2021. trading around $.21 on the dollar. the company wants money from the

government for their nuclear and coal plants. they want to force the and the largest grid operator in the u.s. to take coal and nuclear plants. david: didn't president trump say i going to save companies like this? alix: the government said we want a subsidized nuclear and coal plants. you had the nuclear regulatory agency say no dice. the grid is overpowered so you need to keep them online so you have a reliable source of energy. departmentory said no dice. that becomes an interesting line to toe for president trump. david: how does that work out when he is worried about the workers? alix: exactly. if you look at pjm prices, they

have been coming down. but if you subsidize them, prices would shoot up for customers. you don't want that in an election year in 2018. david: how does a bankruptcy judge sort out whether the government will come in and save them? alix: exactly. future investors as well. i'm interested to see how the white house and markets handle it. definitely watch pjm today. catch this thursday at 1:00 new york time. we will be talking about all things commodities. i swear it will not just be energy. we will be talking to experts, investors, traders, and executives. david: there is nobody better on commodities then you are. alix: a deep dive. plus the commodity and trading angles. up, peter and mike will

join jon ferro. if you are an equity trader, you are playing defense. by nasdaq the hardest hit .7%. the vix off the highs of the session under 21. in other asset classes, you're seeing yields move higher by about three basis points. euro/dollar flat. oil slipping into negative territory, flat for the day. it feels calm. europe is closed. watch tech. this is bloomberg. ♪ retail.

under pressure like never before. and it's connected technology that's moving companies forward fast. e-commerce. real time inventory. virtual changing rooms. that's why retailers rely on comcast business to deliver consistent network speed across multiple locations. every corporate office, warehouse and store

near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver. jonathan: i am jonathan ferro. 30 minutes until the start of trading. this is the countdown to be open. -- this is the countdown to the open. ♪

coming up, china's retaliatory tariffs kicking in. markets waiting for the white house's next move. the president taking a swipe at nafta. the market not in the mood to be made a fool of. 30 minutes away from the opening bell. futures softer. treasuries grind higher by three basis points. to euro/dollar getting up $1.23. it has been two years of calm. wall street repairing what could be a bumpy q2. >>