ings simple, easy and awesome. >> here's bloomberg's first word news. there's some encouraging news conditions of some of the wounded in saturday's synagogue massacre in pittsburgh, pennsylvania. still three people hospitalized, two in the intensive care unit and one in an additional standard unit. the two in the intensive unit better now, no longer requiring breathing assistance or medications to support their blood pressure.

doctor says the third person is a police officer who suffered multiple gunshot wounds. he's said to be in stable condition. in the meantime, robert bowers been indicted on 44 federal counts, including hate crimes. says pipee department bomb suspect searched for addresses of his targets online had photos of many of them on his cell phone. prosecutors also say he began plotting his attack in july while living in his van. says he ultimately mailed 15 improvised explosive critics ofprominent president trump and to media outlets before his arrest. of 100 potential targets was found on his laptop. marked thety today first anniversary of the truck attack on a lower manhattan bike path that killed two americans, a belgian and five argentine tourists. led toiversary has also an increase in security for the city's big halloween parade greenwich village.

>> after the news spread of this the people in the city responded in extraordinary fashion. was one of the most moves things i've seen in my life. in fear,f living people came out in droves to would not bey moved, they would not be changed, they would not be intimidated. >> the truck's driver was shot by police after crashing into a school bus and is awaiting trial on terrorism charges. prosecutors are seeking the death penalty. america's 9-1-1 emergency system was developed for landlines, but about 80% oft says 9-1-1 calls in the u.s. come from cell phones. the country, of you can't reach 9-1-1 by texting. congress is considering two bills that could speed adoption of text to 9-1-1. officials stress that a phone call is still the best way to reach them. textinge cases where

would be preferable, for instance, if a person has a aarning disability or when call might attract the attention of assailants. global news 24 hours a day on air and at tick talk on twitter. powered by more than 2,700 journalists and analysts in over 120 countries. this is bloomberg. ♪ ♪ bloomberg world headquarters in new york, this close.mberg markets the >> we have about 30 minutes on the end of the trading day right markets. sunny in the the s&p 500 up 1.6%, tech charge.the of course, we had facebook coming up, their numbers did well, pushing up the new york exchange fang plus index on four percentage points and dollartingly, the

remains king today. we have got really a pushing up of the dollar. thatntinue to add in particular direction. we, of course, are anticipating week, butlater in the the adp playing the part. >> let's see if there's any red there. you have the vix coming down a little bit. it's below 21, but for the aboute in october it's 19.4. you contrast that with 15 in january through september and, a course, china has been source of concern for investors. the backdrop there, disappointing data showing manufacturing slowed to a two-year slow, but beijing is promising more stimulus. is lifting chinese stocks trading in the u.s. >> so much to keep a close eye got some stocks we're keeping an eye on on because time for our top calls, the big movers. arts up, electronic citingded to $110, limited catalysts at the gaming company.

a price target of $17. the analysts say the companied years,ggle to grow for less licensing disputes with apple are resolved. ad finally, g.e. updated with $13 price target, citing conviction that the ceo can lead turn-around. up by more than a percentage point and there are your top calls. than a week toss go, mid-term elections six days away and campaigns are in their final push. trump heading to florida today to rally his base as part of an eight-state final swing but republicans fear that their kavanaugh bump has faded the voters they need are losing enthusiasm. welcome on this, we chief global political analyst, usually based in london visiting us in new york today. great to see you. as you mentioned, in your note, elections usually don't move markets all that much, but there's a lot of focus on these midterms. should we trust the

polling that we could get a blue wave in the house, but the senate will stay republican? very important question. most people haven't forgotten has thee united states most professional polling industry in the world and we are polled countryy in the world and yet the margin pollsor for opinion which, after all, are trying to anticipate human behavior can be as three to five points, so trusting the polls i would know ourselves how we want to vote? because that's really what's going on. in washingtonas talking to strategists and thesters from both sides of aisle and what i concluded is nobody has very high conviction about this race going into the last few days. ceos, thedo the strategists, the people that you're speaking to, line up portfolio ahead of this, ahead of the potential? ourselvesd we brace

for the potential outcomes and what that does for the markets come next week? >> the way i would describe this as more of a political signal than a market signal, right? would, i think what you by if both houses sort of surprise went or stayed rather with republicans, i think the market would rally because what are looking for out of u.s. elections is more drugs, stimulus. i don't think they're going to get it. the base case according to polls a divided congress. that's usually considered the most benign outcome for and indeed, americans tend to like this outcome, but that's why i say it's a political signal rather than a market signal because a divided mean is is going to think some difficulties and a ahead so it'sn surprises that markets react to. many investors willitate on the this.nes for it's really -- you know, in my ceos, we'res with

talking about the midterms as a signal of what the trump does in the next leaders, and world many of whom are involved in trade negotiations with administrations, they're trying to work out whether trumpism and trump will be around one year something happens, two years because he's a one-term president or to get ready for six. >> and how they respond to that and we'll get into that a little bit later on with the global outlook. i wonder, though, what you think of the argument that no matter what happens in the mid-term elections, indeed no matter what happens in 2020, the u.s. deficit will continue to the u.s. will continue to issue more debt because for all the talk that republicans are fiscal hawks, it is playing out. what does that mean for investors? because voters don't seem to anymore. >> and this is fascinating, if we cast our minds back to only a few years ago, when tea party republicans and that caucus was really a force to be reckoned

with in congress and, of course, obama's hopes of rejected,ere firmly but if we cast our minds back a little bit further it was george w. bush who presided over the biggest expansion of the deficit time with the medicare prescription drug benefits so it really seems to be about who's and who hasending the majority. sureg said that, i'm not the largesse that led to the tax year will be followed by the middle class tax cut that we hear from president trump. you're not expecting tax 2.0 even if we did see as you the surprising outcome of republicans keeping strength in both houses? litmus, that will be the test for the tea party as a concept really, whether they are to get there. my sense and from my washington this

week, neither a second tax cut nor infrastructure spending of any significance anyway is whether it's an, or bothcongress chambers stay with republicans. disappointed with what happens in the second half of the term. >> taking those drugs away as you called them. city's chief global political analyst is going to be sticking with us. europeet her thoughts on next. europe next.

>> now, a possible end date in sight. today, british and european progress iniled negotiations. the u.k.'s lead negotiator predicted a deal could be finalized by november the 21s 21st, saying, despite our differences we are not far from

this issue. on a letter written a few days ago. the press has got hold of it. buy it?e every week there's a new headline and the pound moves on it, but everyone's getting a numb. bit >> well, it's time to start paying attention because the down to marching 29th, when the u.k. will deal and a with a transition agreement or without. me if i remaine bearish, despite what we hear majesty's government, because i really think that the big risks on the front are on domestic political side. a deal-making machine. brussels makes deals, that's best, and it's not difficult to imagine what a deal looks like. let's say that dominic raab is right and there's a deal.

still has to go before parliament, before the lords. there's potential for all kinds wildcard risks, such as it gets taken to the supreme court other developments. so what's really difficult for and for the government is how difficult it's any kind ofto make majority of british people happy with this outcome. british people are divided. >> it's not just that they're divided between leave and for remain has only edged up a couple of points. about half of the levers are not brexitith either type of and either tab. 75% of your population not being happy is a lose-lose. in there's almost a feeling white hall and in the house of commons of waiting for something to happen. >> waiting for a shoe to drop. drop, ofthat did

course, this month was angela she's going to step down and she won't run for chancellor in 2021. you, we were all talking about this earlier. the term ends in october as well so there's going to be a lot of change on the landscape here, and i think people maybe have taken it for you, we were all talking grantee in europe were going to stay static. is her fourth term.n office fos she has outlasted i think just about any elect official in the advanced economies we could name, advanced democracies, anyway. so we've got used to her. mario dragi was the economic unionop for the european then merkel has been the political back stop because she's been much more than a chancellor. she has presided over the greek crisis,the ukraine dealt with putin in a way -- find me another european leader

that kind of gravitas, and i think her approach to using her background as a quantum physicist is phenomenal, breaking everything in tiny pieces. >> and she's been doing that for years and we'll see how it all steps down.fter she tina fordham, city's chief global political analyst, thank us so much for visiting today. >> thank you. all right, as we head towards the close we are looking at a market that is extending its from yesterday cutting from its october losses. >> indeed from new york this is bloomberg. w york this is bloomberg.

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>> this is the countdown to the close. in as always joe at this hour and it's interesting because in the last 34 minutes or so we lost a lot momentum here. >> don't want to overstate it, still in the green across the but this morning was

really looking like it was going to be a spectacular day for some beaten downfa stocks and they're still up, but it's gotten like a little less last 20 or 30the minutes. amazon, look it's up 4.5%. a good day, but it only gets it back to where it was two definitelyd b., it's well off the highs from this morning. so not all that much conviction here.ebound >> for me, the stat that stands out is this is the only time throughout the whole of october days ofve seen two back-to-back gains, which is really phenomenal when you think about it. applies.i think that >> we have a long way to go. if you look at the industry g.m. front and, center pulling up the auto and by 4% and,index, up as you mentioned, a lot of those tech names, software and hardware, media and entertainment, those are your netlux, microsoft, they are all gaining. see big gains across the board for a lot of the tech components. flip side, safety,

defensive names, real estate utilities,trusts, food beverage and tobacco, red rightll in the now and they were deeping towards the close. >> a risky move, particularly echoed in thehat bull market. >> absolutely. here's what it looks like when up, there's that major indexes, it seems to have halted for now and as caroline upnts out the nasdaq still by better than 2%. the s&p and the nasdaq first sok-to-back gains this month there's something to be said for closing the month out on a fairly good note. was.t what a month it $8 trillion wiped out of global markets. >> let's take a deeper dive into the equity action with our reporters. screen of green on the today especially sector-wise. on the month, what a month it is. here.ifferent story this is the group ranked return function in the bloomberg on the we see that nine of the 11 s&p 500 sectors lower, just utilities and consumer staples, defensive sectors up

top and we actually have four sectors that are down 10% or more, correction official corrections just in the month of october. thoseals and industrials, on trade tensions. we had consumer discretionary down 11% on amazon and home depot and energy down in sympathy with oil, which is also down more than 10% in the month is a risk offthis picture for the month of october and the biggest movers, the helpingon the s&p 500 to explain why the index is on pace for its worst month since of 2011, september amazon down 20%, its worst monthly performance since 2008 that disappointing holiday quarter forecast. microsoft, decent quarter. this tells you that there hasn't been a ton of activity outside of today and home depot down 15%, ahead of their earnings month, soing out next that is in sympathy with all that weakness that we've seen for the homebuilders. slice it sector-wise and stock-wise, october shaping bearishly.

>> i'm looking at the energy patch. more weakness, very much weakness. mcdermottg at international, a texas-based oil energy services company. reported earnings that were highly disappointing, its deepest cash flow deficit in years. its shares plunging today, the most in 16 years, down more than 40%. its bonds also plunging. of course, this brings total thanto date losses to more 60% and highlights how there can oil path that goes well beyond the decline in crude prices that we've seen so year.is >> well, lisa not a good day for gilliad either, those shares down 5% today, $5 billion wiped out just today. that all on concerns of a program from the united health customersfering prepaid debit cards to use cheaper drugs for hiv and that's a big threat to gilead which makes some of the best hiv been relyingnd has

on them to boost its growth, but just toot here is concerned about that slowdown and the next catalyst is the new ceo, a new vision, a new strategy to pull this share out rut.e >> breaking it down in terms of individual stocks to keep an eye on. tech, also ending the month on a high note. leading the rebound after one of the worst months. did -- look how netflix is up six percentage points. a second day of green? >> it's a great question really. why today? than $1 million. >> a trillion dollars question. but i think investors, there specific reason. a lot of people are going back to the fact that these are stocks that are just so beaten selloff so now, some nice gains. faang blamest the plus a couple of others, it's 10 every single one of

them is higher today. if you look at the gains from yesterday and today, it's the best two day streak since 2016, but if you look at the month it's also still the worst month since 2016. so two days compared to a month. >> do people have any reason to something's changed or is this just sometimes bounces can happen in the middle of a longer downturn? bouncesld say sometimes can happen. there was no real news, nothing that came out. facebook earnings, people are buying the fact that they're focusing on instagram and video and stories, but i don't think that's really enough to turn the entire space around. this is more company specific so it looks like people are just now, that we've seen so much pain. >> you are sticking with us aboute right now with three minutes to go before the -- a we want to bring in down trend. we're seeingnk

today is the fact that valuations have come in. favorable.lready investors feel more comfortable with the trajectory of these companies. concerns have been alleviate asked frankly, they're a group of companies, the tech space where results continue to be time and time again, analysts underappreciating those businesses. we're seeing it this quarter. we're likely to see it down the road. get apple, of course, earnings tomorrow. how much of a bellwether will we now stop to look at individual earnings and look more at the opportunities in terms of valuations? think valuations is a great starting spot. i mean, we've had a pretty selloff here in the market. for those people with the conviction that they had, this provides the entry point that they're looking for. we do not see a recession on the horizon. think investors should be in stocks over the next several months. >> and just on the tech for all we talk about them basically every day, you think investors still don't really appreciate them? interesting is's

when you look at a tech company trades the same as a staples company so the question is if i own a staples modely with the business that is under pressure -- does,ebook does, apple amazon doesn't. >> when you look across the tech space in general, the majority of them have profiles, valuations that look very similar to those staples companies, but yet the prospects of those companies are significantly stronger. growth rates, three to four ames what you're seeing in staples name. >> approaching two minutes before the closing bell. what asset class is leading the way here? equity is certainly among the most volatile, but do you look at credit, the dollar? >> that's an excellent question. we look across this space, the volatility that we're seeing is pretty much limited to only equities. we're not seeing issues within hig redit space, within and equities, one

that we believe is unwarranted and we should get that back as time proceeds. >> what about the volatility seen?ion that we've >> the volatility situation that we've seen yesterday after the close, even though we had a a prettywas still crazy day. today, it was a little calmer, mostly higher. you see jumping around at the end, but it looks like it was more of a stable climb than we saw yesterday. but i would say the large consensus, the broad consensus is that the volatility is not going to go away. have midterms next week and just because we have two days of gains doesn't mean we are out of did sees of what we over the past month. >> are the midterms just noise? >> for the most scarlet: but the fed is not noise and will be meeting next week. front and center is whether or not they raise interest rates and if that is a drag on the market. >> what is nice to think is the

fed is normalizing because the economy is strong. it is taking this opportunity to re-normalize policy against the strong economic backdrop we are in. therefore, we view it as an opportunity to move up. the economy is strong and equities thrive in that market. the closingre's bell and recovery and recovery in stocks. a second day of gains. the nasdaq up by better than 2%. the s&p hire as well. we saw a little -- higher as well. caroline: it's interesting the nasdaq closes up more than 2% and that is the longest losing streak since september the 28th. joe: i got a little jittery at the end. tick byyou look at a tic jar, there is selling in the last couple of seconds. 2% is good relief for the bulls. even still, it feels like people are not totally sure that

november will be much better than october. caroline: it has certainly been a brutal month. we at a trillion dollars out of a global market in october. lisa, what have you been watching? >> even the markets are rallying, equity markets and inflation expectations continue to come down. if you take a look at expectations, over the next five has fallencan see it back to where it was at the beginning of the year. from about 2.2% at the big of this year. what is driving this? a lot of people are pointing to oil. oil prices are falling to the lowest level since august continuing the slide today perhaps because of the dollar strength, but also because of concerns about the lack of demand because of growth or more supply people have thought. this seems to be part of the driver, but the decline in expectations has outpaced the decline we secret values.

abigail: needless to say, october has been in a struggle remote for stocks. take a look at these declines for october. the s&p 500 is on pace for his worst decline since 2011. the nasdaq, tech heavy, on pace for its worst monthly performances november 2008. the degree of selling pressure we have seen is matching lehman in the midst of the financial crisis. buyers want out. this chart suggests we could see more of the same. this is a long-term, monthly chart of the nasdaq 100 -- nasdaq composite, skews me. -- excuse me. over the last five years, we have seen an uptrend and the buyers control marked by this white trendline. the nasdaq almost in a bear market at the time, and september down and now we have

the nasdaq on pace for its worst monthly performance since 2008. the chart may suggest the climb will continue as we move down to where the uptrend. time will tell. nasdaq, month for the the really bad month for homebuilding companies. stocks in the s&p 500 -- as in the spider etf is down 11% this month. there are a few factors contributing to this. first is concern over slowing economic growth in the united states, and then of course high yields make borrowing more expensive. datally disappointing has been trailing estimates for months. the good news is that people put in about 111 million into this etf yesterday.

the entire marketing, great perspective. on today and the month of october. it was a volatile month for stocks. equities ended in the green, but not enough to wipe out the losses for the month. here's a recap of some of the fears of investors in october. >> these markets are dealing with cross current. >> more headwinds such as increased inflation and rates. >> fears about global growth. >> earnings growth and revenue growth are slow. >> estimates for next euro too high. -- next year are too high. >> tightening central-bank policy, fiscal stimulus speaking. >> continue tightening by the fed. >> volatility starts to go up as a function of the fed getting into more hawkish territory. >> we've moved into high volatility regimes. >> we also have the situation in italy. >> there is only one true systemic geopolitical risk. >> it has to be the tensions

between the u.s. and china. --y are not >> all of this is starting to get into thiese numbers. >> that means equities will have a tougher time. >> we saw headwinds to fight through. scarlet: still with us is patrick from credit suisse. you made the case that valuations look to appealing -- look appealing and optimistic. we heard a wall of worry whether it is earnings, fat, volatility, u.s., china, what does that mean for the traditional santa claus rally and if stocks can overcome these concerns? patrick: what investors do every day is look at the risks. the question is are these risks new? no. are they different than what we have seen before? there is not really a sizable shift in any of those issues. we're not seeing it show up in

the numbers. revisions, they are not coming down. for those saying the numbers are falling, we're not seeing it yet. the issues at hand are not to driving the fall in estimates that everyone thinks. --: so when people look at ultimately the markets will do with the fundamentals dictate. the could be a long lag and overshoot in both directions, but when it comes to earnings and comes to anything in the real economy, anything on the policy landscape, you just don't see anything? patrick: it's not that i don't see anything. you are asking the if it is worse now than it was six ratio. joe: right and you don't see anything? patrick: i've not seen any of those issues metastasize into greater problems. the economy is expected to slow for the better part of the year. we understood earnings were going to pick this year. that's because of the tax policy and bump up in the u.s. economy. those are not new things people are focusing on.

those have been in the estimates and they have not changed. caroline: i feel at the noise around the fed is getting louder weather is trump on twitter or analysts coming out like wells fargo worried about the fed as we get these market jitters. is that your number one risk going to november, december? what is? patrick: in relation to the fed, my number one risk is wage inflation. it is something we have been falling closely at this -- following closely. washe start of the year it 2.2 or 2.57. it has helped the fed re-normalize interest rates in a very normal way. scarlet: so the riskier is that it starts picking up once again? patrick: yes. the labor market is very tight. we would expect wages to move higher. they haven't and, therefore, but has not been the problem we expect. it is the one thing i'm solely focused on.

scarlet: there's a lot of divided thoughts on where the market is and whether it offers good value or there is more downside to come. technicals come into play and get extra attention. how do you full that into your analysis? does it prompt you to make a decision one way or another? patrick: the crux of my question is "are we headed into a recession," and the variables we look at, everything says not in the near time. we still have a yield curve not inverted yet. those are the preconditions that typically receive a recession. they are not tear. absent a recession, you want to be in equities. joe: if you want to predict the downturn in time the market, you have to predict a recession and no one can do that. patrick: it's not that you can't predict a recession. joe: but people are pretty bad at predicting it. patrick: but there are signals at mattel you -- signals that tell you we are getting low an economic cycle.

we don't expect a material deceleration in the ism. has remained historically strong. caroline: what then would you look for to be appointed which you shift asset classes? point, given the sentiment we seen, equities don't become the by? patrick: we would need to see the yield curve invert. that is the classic signal that we have moved into a recession. when i couple that with other indicators, i would like to see the ism slow and wages accelerating. there are several which i would like to see at the same time. if you ask me for one, it would be the yield curve. patrick, thank you so much for joining us. we have earnings. bookings third quarter

million which is ahead of expectations. fourth-quarter earnings is coming in shy. it seems people are looking at the forecast and down goes the stock after hours. meanwhile, fitbit is up 12%. overall revenue is ahead of expectations. also adjusted earnings per share are much better than the loss expected. scarlet: we will continue to keep an eye on all of those stacks -- stocks. me and for ther closing bell. this is bloomberg. ♪

caroline: live from bloomberg world headquarters, i'm caroline hyde. here's a snapshot of the u.s. stocks closing higher today. the first backed by gains all month. joe: the question is, "what'd you miss?" caroline: more tricks and treats for the global economy. the risks of a fed blowback and worsening trade war may be here to stay. the blue wave sweeping to wall street. areamerican securities opening up their wallets the democrats. and betting on the new iphone investment, we will be watching for signs of apple products following the new phone launch. we are in the halloween spirit here in bloomberg so our

question of the day is a little spooky. what scares you about the markets? >> the fed clearly. bull markets never die of old age. they are usually murdered by the fed. >> there's only one truly systemic geopolitical risk, and that is the relationship between try not -- china and the u.s.. so far, it has been skirmishes. does deteriorate in the full-blown trade war, there are no winners. this is two great superpowers crushing. >> it has to be the tensions between u.s. and china. tradek they are not just related. the one issue most people in the u.s. on both sides of the house appreciate and agree on is they need to have a different stance with china than they have had

over the past 20 or 30 years. >> the most fearful things are companies are probably most -- more financially levered than investors understand. i think we have not seen the shakeout in that space. joe: turning to the economic risk, we bring in our economic chief economist, tom orlik. the big show for economic data is this friday with the jobs report. what is it going to tell us about the state of the economy? tom: at this point, joe, the key question for investors looking at the jobs report is is it going to do anything to unsettle be aed from what seems to fourth move this year in december. the question our u.s. team has in mind is where is the fed going to come out in this tussle

between robust looking economic data, low unemployment, signs of wage growth picking up. and deteriorating financial conditions. you come back to the big question on what could well,ilize the market is, the fed pays attention to the current economic conditions and less attention to deteriorating financial markets. potentiallyh could be a destabilizing factor at the end of the year. caroline: so the fed having a deaf ear to that is one key issue and another issue is the deteriorating relationship between the fed and the head of the white house. tom: that's right. independence, whilst we talk about it a lot, is a tradition that has been honored more often in the breach than in the observance. if we go back to the lbj era, president. -- by the

even the hero of quelling inflation was told not to hike interest rates heading into the 1980 for -- 1984 election period. now, if you look at all the pressure trump is trying to exert on the fed, not so much that the fed will crumble to the housere, but that what view could shift public sentiment, market sentiment, and that sets up a conflict with the fed, and adds to the market stress. joe: i want to go back to the data. our last guest was saying one of the main things that would concern him from a market standpoint would be accelerating wage growth. we got employment cost index today. where does it stand? it feels like we have hints of accelerating wage growth and setbacks. what are expecting to see you're going forward? tom: i think certainly we've

seen some signs of wage growth picking up strongly. i think one point to look for in the upcoming wage data is a base effect. moves atignificant this year and that will be playing out in the weights numbers which we look at for october. i continue to focus on some of the secular drags on wage growth. things like the role of the gig economy and the diminished role of trade unions. things like lower costs for investments. my view is that even ifmployment comes down, even the hidden slack comes out of the labor market, the secular forces are still going to be dragging on wage growth. i'm not expecting it to surge higher. caroline: a great take from tom orlik there. that's a great piece on the bloomberg should you want to read more about what keeps our team sleepless. let's get back into the earnings.

aig, anditbit, zynga, we see the after-hours performance. let's dig into a little. fitbit was up 12% at one point in this seems to be a company posting gains. scripts, the common basically down back in line with expectations. adjusted earnings per share $2.43. 7/10 of 1%. joe: my reaction, mostly mild with all of these except the fitbit one, the big mover after hours. caroline: always a volatile stock. meanwhile, coming up, wall street is betting on a blue wave. why the financial industry is crossing the aisle with their campaign donations and what it

means for the next two elections. this is bloomberg. ♪ ♪

caroline: wall street has long contributed to candidates in both parties, but this year it is giving more to democrats than republicans. jesse westbrook joins us for the story. we seeime in a decade it, even the bankers are getting more generous even though they are not giving more to democrats. what are they hoping by setting themselves up in terms of onside before they turn the house blue? jesse: i think you have to differentiate a couple of things. the shift in more money from the industry is probably more people who on wall street don't like

trump. it could be as much as climate change as immigration as it is about bank regulation. and theanies themselves banking industry, it is about mitigating the headline risk they would get from a democratic-controlled house of representatives. to changeot going much. trump still has all of his regulators in their. they will continue the steady drift of rolling back rules. you don't want democrats spouting off constantly about we need to break up the big banks, we need to take away the punch bowl from wall street's risk-taking. so you want some friends if you're going to be dealing with a blue wave. joe: so the basic idea is if the democrats are going to win. this will not began to but a lot of people think they will take the house.

jesse: we do know about politics that money buys sympathy. whether people done in washington want to admit it or not, if you take a big check from somebody, it is harder to then go around and say the next day on tv or in an op-ed that we need to break up wall street banks if you taken a lot of money from those banks. joe: just getting back to the question of democrats versus republicans, is there a clear shift overall from money going to republicans to democrats? jesse: i do not think there is a clear shift going on overall. the securities industry and investment industry has given more to democrats than they have in years past, and much more to democrats than they have to republicans in years past. opening,id in your banks separate from the investment industry are still

giving more of their money to republicans, but there has been a shift as well. caroline: who'd we need to look out for in terms of the power over the regulatory bodies? there are key democrats who might rise to positions of power , that the bankers potentially have their eyes on. jesse: maxine waters would be in line to run the house financial services committee which oversees the bank regulators, deals with banking issues, but i have to reiterate, you can drag , sece fed regulators regulators, to testify all you want, but you cannot change what they are doing. legislative gridlock will continue in d.c. and we're not --nis c dodd-frank ripped up not going to see dodd-frank ripped up. congress is a no man's own for doing much of anything. regulators are going to continue to carry out trump's, agenda and that will probably be good for things.

joe: ultimately, even if nothing is going to happen on the regulatory side or legislative side, you have to give money to everyone. jesse: [laughter] i guess it is always that's compared to keeping your powder dry. in politics, there is not much benefit to keep your powder dry. caroline: jesse westbrook, we thank you. the etf industry has something for everyone including those who invest according to their political association -- affiliation. here's one from the etf iq vault. the point rich gop stock record etf has a ticker that would make president trump proud. the acronym for make america great again invests in political action committees and are highly supportive of republican candidates. top industries are energy, industrials, and financial with

names such as marathon oil and others. what is notable is what is not included, tech companies. the expense ratio is not cheap at 65 basis points. in thets a green light traffic light system with a notice for its equal weighting which results in increased volatility. what is interesting about this is it is called maga for obvious reasons. tech is not involved in this etf , however, some people use a new acronym for tech witches maga -- which is maga, microsoft, amazon, google, and alphabet. joe: that's interesting. particular when they are opposites.

this is bloomberg. ♪ loomberg. ♪

mark: i am mark crumpton with first word news. president trump is criticizing house speaker paul ryan dismissed his call to end birthright citizenship for the children of non-us citizens born in the country. the presidents b tweeted that the "speaker should be focused on holding the majority instead of giving his opinions on birthright citizenship, something he knows nothing about." mark: ryan says the president " obviously cannot end birthright citizenship through executive action." sarah huckabee sanders was asked about the speaker's comments. >> the big issue that you have

to look aat is the reason we are in this position in the first place. democrats in congress have failed to fix our broken immigration system and the president is looking at all options. he will make a decision about what is best to secure our border and maintain law and order and our country. mark: birthright citizenship is guaranteed under the 14th amendment to the u.s. constitution. the suspect in the pittsburgh synagogue massacre has been indicted by federal grand jury. -- they charge robert bowers with 44 counts including a grimes. prosecutors seek to -- including hate crimes. prosecutors seek to go after the death penalty. he is being held without bail. the chairman of emergency medicine at the university of pittsburgh medical center says three shooting victims who remain hospitalized are doing well. congregants two cupboard

of the tree of life and one police officer. >> the prognoses are good for all patients, but each of them will have a different trajectory and will likely require a series of ongoing care. while they much better, i suspect there is still a lot more care to be delivered. mark: more funerals continue today for the 11 victims of saturday's attack. new york city is marking the first anniversary of the truck attack on a bicycle path that killed two americans and five argentine tourists. the anniversary has led to an increase in security for the city's annual halloween pray tonight -- parade tonight. the truck's driver was shot by police after crashing into a -- school bus. a former federal investigator says a mafia hitman is a suspect in the prison slang a boston crime boss james whitey bulger.

a longtime investigator spoke on unlimited -- eminem in because he is not allowed to discuss the case. he was an informant who provided information on the mafia. they are investigating the victim's death as a homicide. global news, 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. joe: general motors beating estimates for the 14th straight hikesr thanks to price and strong catlike sales overseas in china. gm cfo joined bloomberg and weighed in on sales. >> it is clearly a volatile environment that we are watching

closely. we continue to execute on things we can control. we have been focused on costs and you see the cost discipline coming through this quarter. joe: for more on this, let's bring in bloomberg news detroit bureau chief, david welch. it seems like it has been a good quarter for the u.s. automaker. they released good, relative to how investors have perceived these companies from most of the year. david: that's right. for did not have a great quarter. they beat expectations. sort of a question of low expectations and pretty solid performance. in g.m.'s case, it is low expectations and a strong performance. they beat by 62% share which is a lot even though some of it was from a lower tax rate. the rest of it was selling cars that make a lot of money. the medium-size suvs that selected prices, they raised

their average transaction price by almost $1000 per vehicle and, $4000 per vehicle above their competitors on average. that is good money. new pickuphe trucks coming out in the old one has been discounted pretty heavily. as the new and comes out, that will have better transaction pricing. that adds up to better margins. lower overall volume, but great profitability because of the kind of vehicles they are giving. caroline: even despite a half billion dollar loss on crude. i'm interested in the headwinds they outlined whether it comes to currency headwinds, commodity cost headwinds, how much will that spill into what we see in the numbers in terms of auto sales later in the week? david: if we look at auto sales tomorrow, most of the analysts i'm talking to are saying it will be a solid month. that is where everybody has been

putting sales month by month. probably not spectacular gains for anybody, but strong enough sales of the cars where everybody will be making pretty good money. gm will not report sales, we will have to dig those numbers up on our own. well,l probably do pretty sort of more of the same we have seen from them, witches selling a lot of high dollar, high-margin vehicles but not having a highlight gain in sales. we will see profitable business. i think that is what the rest of the industry will do as well. it will be later in the year when we see the big year-end discounting in sales. i think october numbers will be pretty solid stuff. joe: i feel like whenever we cars, there is -- it is the european companies getting squeezed. how to the fortunes of the u.s. players differ or similar to what we see from the european manufacturers? david: european manufacturers are more subject to anything going on with trade wars.

if there are tariffs, on imported vehicles, they get hit. if the chinese put vehicles -- tariffs on vehicles imported, they can get hit there too because they make a lot of vehicles in the u.s. and export around the globe. u.s. companies, because of the good deal of mexico, trade war stuff is not hurting them quite as much. that is a big differentiator right there. the european car companies should b do well in the u.s. because luxury vehicles are still selling. and that is also in china, the part of the market still doing well. gm is a great company to look at this because it is bread-and-butter core. brand ande domestic entry-level brand had a worse quarter in china because the interior cities, smaller cities, the economies having getting hit there. the german luxury bands -- brands are doing well. caroline: one to watch.

david welch talking about gm, the second-best performer on the s&p today. apple is the last of the faang stocks to report their quarterly earnings tomorrow. for more, let's bring in mark gurman. we had the fanfare of the event in brooklyn with new ipads, max, as we're looking back to the newer generation of iphone x to drive the previous quarter. mark: that is absolutely right. everything they announced, that two umax and the new ipad, will have zero impact on what we hear tomorrow. the big picture for tomorrow is x.e iphone x s and xs ma joe: what do analysts expect and what will be the number determining whether investors will like it or not? mark: apple's guidance was between 60 and 62 billion for the fourth quarter. we're looking at estimates around 61.4 billion, so flat

right in the middle. it should appease investors and analysts alike. what they want to know is the number for q1, the holiday quarter. right now we see estimates around 92, 93, upwards of $94 billion which would be a record for the holiday quarter. all eyes will be on that. caroline: all eyes remain on the iphone because this is a company that keeps talking up the services side of the business trying to persuade us that perhaps the cash cow can change. mark: it is still the iphone company. what really has people optimistic is services category. we are looking for the first $10 billion quarter for services. why that is so fascinating is because apple has been talking up services so much in all of these calls, events, website, but truth be told they have done nothing new in services and about 2, 3, or four years. the fact that they are making so much from a business that they

have not added anything new to is impressive. think about when they start coming out with new services or updating older services. joe: what kind of services might those be? mark: two once set for next year is a news subscription service is aes set for next year new subscription service and the other service would be their video content efforts integrating into the tv after they have been shipping in the iphones for two years. joe: i know this is a cliche question, but is anyone watching apple original content? i know it exists and i read an article of the other day in a magazine about someone getting paid a lot of money to appear in an apple show, but is anyone consuming the content? mark: so far, apple has had only a couple of shows, fewer than three, one is carpool karaoke which is not terrible. it is not quite successful either. it has become popular in pop culture. they had another show about app development, kind of like a

shark tank ripoff that was a failure and not resonate with consumers. their batting average after two shows is a 500. they're working on dozens of new shows. we will have this conversation again in a year or two bank from now and we will have a better idea. mark gurman, always great for you to break it down for us. coming up, after a spooky october, the possibility for rebounds are everywhere. get the gtb terminal function ready because march arts is up gtv -- gtb terminal -- terminal punch and ready because smart charges up next. this is bloomberg. ♪ this is bloomberg. ♪

caroline: time for the bloomberg business flash.

verity's capital is said to be near a a deal. elliottamiliar say wants to increase the stake in their health care technology company. shares rose on the news. but the price being discussed could not be immediately learned and negotiations are ongoing. do you tell people how much money you make? according to a new survey may depend on your age. all most twice as likely as baby boomers to share the salary with their coworkers. they're more comfortable dipoles in their pay to other people in their life. almost two thirds of people surveyed chair how much -- sure how much they earn with their family. -- share how much they earn with their family. it's time for smart charts where we dig into the timely topics with the top technicians. mark: joining me today for smart -- abigail: joining me today is mark newton from noon advisors.

-- when you joined us for another segment not too long ago, turkey futures, you suggested shorting the nasdaq 100 futures. here is now a chart of the nasdaq 100, the actual index. are you taking a different stance? mark: that has worked out well worstter one of the months since 2008 in the nasdaq, we see a trick-or-treat today more of a tree to the metric. a very constructive move in the index. the nasdaq moved up above this prior low it's made in october. that is constructive. there were some signs over the last couple weeks, better breath, momentum, rampant pessimism. we did not see a capitulation at the lows but once everyone said we needed to have it, it was less likely we would get it. my thinking is we get right up near 7280 initially, potentially near 7500.

i would use a minor dip to buy. abigail: i have two questions, we have this broken uptrend and that tells you the sellers are trying to take over, and you also have the gap. is that a breakaway gap or could we see it go back up and down? mark: specifically because we have gotten over prior highs and broken this downtrend, we are likely not going to fill it. point taken to the deterioration, but the longer-term trends are still intact with the nasdaq. the s&p did in fact break its two been your trend -- two-year trend. you have to be tactical of this standpoint ed: certainly -- standpoint. abigail: growth has been under performance value -- performing value recently. this is the russell 2000 growth value index overall doing well.

mark: as you see, we see a big breakdown of growth, but the longer-term trends are intact going back. it is really going to important -- be important on any snapback that we get over this prior low we saw. former support becomes resistance. we see a lot of near-term damage. it is time to sell? the growth rate is still at fact -- intact. on this longer-term trend in terms of the ratio growth to value, that would be a larger concern. abigail: that would be something to be concerned about for sure. one area that has lagged, the financials. you think we are on a cusp of a breakout. talk to us about that. mark: i often use ratio charts to look at sectors, and what is interesting here, based on specifically what happened with the xls getting over 26, ratios of xls breakout above this entire downtrend that started

since the spring. that is very constructive at a time where everybody in the world with stock financials should move up with rate and have not. we have seen to have bottomed out and we see capitulation and last couple of weeks with the xls and a meaningful bounce. it looks to be five ways down. the bottom line is, when you see relative charts making improvements like this and breakouts, it pays to think we will have a decent bounce in financials. abigail: super quickly, because everybody thinks we may not, what worries you hear considering that downtrend? mark: if this fails in the next day and we do not fall through as expected and we take up these lows, that would be a bigger concern. we need to rally to continue over the next few days and into midterm elections. if we do not see the follow-through, this could have been a lot stronger, that would be a concern. we're not in the capitulation at

the lows. abigail: and typically want to see that. mark newton of newton advisors, thank you for joining us for smart charts. caroline: thank you. a flashback to 2008, junk bonds. high-yield had its worst october in eight decades. we sat down with the father of junk bonds. >> and you are working for leading prestigious from then, but it is said you discover the idea or helped to propel the idea that investing in what is called high-yield bonds was a better investment than investing in let's say investment grade bonds. is that more or less it? >> it is. one of the ways i was able to convince the firm was that i took a look at the stocks they were recommending. most of the companies were not investment grade. here they are suggesting you invest in the equity of businesses but not suggesting

on can buy preferred stocks other parts of the capital structure. if we look at it today, the rating agencies, about the lowest you can be rated before you go bankrupt and you get a d, is a triple c. let's think of three firms in the news today. , the company is worth tens of billions of dollars and does not have a lot of debt relative to its equity. it is rated triple c. tesla, talking about doesn't have a lot of debt relative to its equity, it is rated triple c. theyu can go to we work, are rated triple c. what i discovered is quite often the future in credit is rated low, even though it is the future and the real risk lies in companies that we think of as establishment or have paid

dividends for a long time. that is michael there and catch the full interview on this week edition of the david rubenstein show. coming up, china's leaders want to avoid a flood in stimulus. a worst economic picture is putting on the pressure. this is bloomberg. ♪ ure. this is bloomberg. ♪

caroline: time for asia ahead. agingata is pushing toward stimulus measures it was trying to avoid. yesterday we were talking about approach, this approach china has on taking pmi's. shery: they had to talk about it. it was hours after their latest pmi data came out. good. not looking the manufacturing growth slowing to the lowest level in two years. we know if you see this chart on librarylibrary -- gtv

it is already not great compared to the u.s. and europe. you now see is slowing even further adding to concerns of what is happening in the chinese economy. the yellow line being china. caroline: still above 50. shery: yes. a barely managing above to stay above 50. 50.2 this month. because of this, they had a meeting with president xi jinping and came out with a statement saying they are looking at all of this and they want to be more preemptive and take action in a timely manner. joe: does this mean we are getting closer to something big or are they still going to be targeted on tax credits and things like that? shery: right now, i think they want to put out the rhetoric that something big could be coming, but the challenge to that is as we know, debt is already huge. we are talking about 260% of gtv the chart on the

library. including corporate debt which has started to stabilize until last year. starting this year, it started to rise again. they also have this image. in ande president came talked about not wanting to rely completely on this credit fueled wrote -- route. joe: is there another way? shery: right now, yes. there,d pieces here and of course we have seen those export rebates and have seen those tax cuts or talk about tax cuts. there could be a couple of things they could do. just except the fact he will get slower growth -- just accept the fact that you will get slower growth. caroline: a look at they go? with a ever let it slip below 6%? shery: bloomberg economics say if you get 25% tariffs on all of chinese goods, you will go toward 5%.

the spring of 2019 will be a tough one. another way to go, as we have been emphasizing. joe: could this weakness give any impetus for president xi jinping to make a deal with trump on the stuff trump wants? shery: that is what president trump wants. the slowing economy pushing him to come to a deal. he also has to save face. he has this made in china policy he wants to push through so that would be a politically difficult decision. caroline: shery ahn, you don't want to miss her. "bloomberg daybreak: australia" and "bloomberg daybreak: aisa." avril reports earnings after the close tomorrow -- apple reports earnings after the close tomorrow. that is all for "what'd you miss?"

"bloomberg technology" is up next. joe: have a great evening. this is bloomberg. ♪

i am emily chang in san francisco. coming up in the next hour, a look into facebook's future. will investors get on board or is it a gamble on videos and stories? a hotly debated ballot issue in san francisco, funding for the homeless, has the tech community and city divided. we will speak with one of the most outspoken advocates for new ballot measure. and apple'