mark: i'm mark crumpton with bloomberg's first word news. president trump says he is not happy with the cover mine is republican and democratic negotiators worked out to avert another government shutdown. he said he will hold a meeting later today to consider the deal. speaking during a cabinet meeting at the white house today, the president said "it is really obstructed by democratic lawmakers. that 1.3 has learned billion dollars for 55 new miles rioorder fencing in texas's grande valley area was proposed. the president wants to $5.7 billion. nato's the secretary-general

will respondiance to what insists are russia's violations of the cold war bandsf treaty that ballistic missiles with the range of 310 to 400 miles. is u.s. ambassador today seeking to reassure allies concerned about a possible nuclear buildup. >> america has started the process of withdrawing from the treaty unless russia does come ink into show it is verifiable compliance. our allies want to know what the future will be. the future will be that we will start the development of a defensive mechanism, and we will keep our allies informed all along the way. president vladimir putin has announced he is pulling russia out of the inf as well. macedonia today officially

renamed itself north macedonia, honoring an agreement to end a decades-old dispute with neighboring greece and secure its entry into nato. macedonia raised the nato flag at its main government building, and members of the alliance continue to ratify the agreement. the name change resolves a dispute with greece dating back to macedonia's desolation of independence from the former yugoslavia in 1991. french officials say almost three months of protests across by the yellow vests demonstrators have led to 1800 commercial convictions. the prime minister says another 1400 are awaiting sentencing. speaking to lawmakers today, he also condemned various anti-semitic acts over the weekend, calling them repugnant. those acts have not been linked to the demonstrators. global news 24 hours a day on air and on tictoc on twitter powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg.

♪ scarlet: from bloomberg world headquarters in a snowy new york, this is "bloomberg markets : the lows." caroline: we are 30 minutes from the end of the trading day. the dow jones industrial average 1.5%. basically mcdonald's is only off by less than 0.1%. every single other member is in the green. caterpillar, dupont, why are in a leading? they are treated exposed, and there is we will get some sort of china and u.s. trade deal. scarlet: progress on potential trade talks and border security helping us avert a government shutdown. both of those driving.

the last two days, it felt like we were just waiting. caroline: what is also up his the pound a little bit. a story of dollar weakness today. theresa may updating lawmakers on the progress or lock them of brexit talks. but this has been a risk on rally across the world. scarlet: dollar weakness is accompanied by a selloff in longer data treasuries. tlt off by 0.3%. let's get now to our top calls. this is a look at some of the movers. first is gilead. downgraded to market perform. price target cut to 68 from $89 a share. increased pressure on drugmakers . downgraded permit a price target now at $49 a share from $51.

analysts citing trends from the business and share gains over the past year and a half. finally, take two. price target reduced to $80 a share from $119. lackluster gaming sales have finally caught up with their high valuations. those are some of your top calls. caroline: let's stick with the corporate news fund. a strong finish for under armour as shares have been jumping after fourth-quarter earnings short some profits. that is despite the company's revenue warnings for the next quarter. here with more, sarah joining us from washington. your take on the numbers because it looks much relief about the turnaround. sarah: i think what investors were responding to today was the improvement on gross margin. last year, under armour ended up with a huge amount of bloated inventory. some of that because of a sheer lack of operational discipline.

some of it was because they made a of boring products that people do not want to buy. they had to unload a little bit into the operational or mark it down tremendously. a strong increase in gross margin this quarter suggests that working to the inventory is finally behind them. they did say they got to do fewer promotions in the quarter and less off-price sellin. that promotes stabilization. scarlet: inventory management is where it is at. under armour has made clear this is their third year of the three-year transformation or restructuring. where are we? did you see it as a company in the final innings of this restructuring? or is there more to do? sarah: i think there is more to do. we have seen clear examples of the fact they have learned how to be a mature business instead of a startup. they have a better organizational structure in place and those kinds of things, but when i'm still not confident for under armour is product innovation. they keep saying they have not made their defining product yet.

i think that is really true. they just started returning their focus away from athleisure to more performance oriented pieces and even promising things like innovation and fabrications and innovation in the footwear space. they have the curry sneaker in the hover sneaker that have done well for them but are quite far behind nike and adidas as well. you have to say to yourself destabilize things, but where is the next chapter of growth going to come from? that is the story we still do not know yet. talking next chapter among quite surprised how much the market shook off their warning about q1. sarah: yes, and i think that is because they said that that should improve through the back half of the year. for example, in q1, they said they were going to go back to more of this ought price selling because they saw good opportunities seasonally to do it. q4, it should go back to where it is this

quarter, so that is why investors were willing to overlook that. scarlet: under armour is targeting a very specific customer, performers as opposed qw --e casual athleisure wher wearer. is that a good thing? does it boosted their growth at all? it limits them? sarah: i think so, but someone will pay high ticket for items. they will pay high prices. $95 for leggings. $150 for sneakers. because they are really invested in their sport. a more casual athletic consumer is perhaps not going to pay those higher prices. the ceo has said he feels that focusing on those really serious athletes gives them more of a halo. even those less serious athletes when they see the brand messaging oriented towards serious performance athletes, they will respond well to that.

it will be a halo over the whole red. scarlet: kind of aspirational as well in other words. thank you so much, joining us from washington.coming up , shutdown averted. we have all the details on washington's tentative deal to keep the government friday and what the president has to say about it. this is bloomberg. ♪

scarlet: stocks rally today after congressional lawmakers in washington said they may have reached a border running deal. the agreement calls for less wall construction funding the president had previously argued for. the president weighed in on the possibility of a shutdown in a cabinet meeting earlier this afternoon. president trump: i don't think you are going to see a shutdown. if you did have it, it is the democrats's fault. i accepted the first one, and i'm proud of what we accomplished. scarlet: for more, we want to

bring in and out from anna from -- washington. talk us through what kind of the, tentative deal, republicans and democrats have come to and whether that is enough to change president trump's mind. >> this is divided governments of either side is going to be 100% happy with what the negotiators worked out. the appropriations committee was really proud of this deal because they sat down, did their hard work in this room yesterday, and they traded. what do you want ?what do i want ? to and take. both sides give what they want, but neither side is 100% happy. the president responded with the deal that he is not thrilled with it, but neither the his conservative allies in congress have said they will reject the deal or call on the president to veto it. caroline: we got hard tangible data that perhaps the shutdown did not complement restorative businesses.

how much are the markets speaking to worrying about the shutdown or is it a slideshow? >> it is a sideshow. the hard data has been relatively positive. as you expect, sentiment data on the south side as people weigh in on this.if we get through the rest of this week end the shutdown becomes passé and we agree to a deal, would be way behind the markets and we go into the second quarter barring any trading cups with really good steam going forward. jobs,t: hard data from but does that not tend to lag behind ashlee vance? can we -- behindashlee vance? -- actual events? >> we see cpi data coming out this week. we will watch to see if there is a pickup in inflation, which would be troublesome for the fed as they just walked back the right heart story" story.

-- rate hike story and growth story. caroline: has it become a bit of a redundant to will now after we have seen the pain inflicted on ratingstiment and the of the president himself. is he willing to go there anyway, or more to have an emergency means to bring about a border wall? >> that was something that was really striking last week and heading into this week. no one wanted to go into another shutdown. almost no one on capitol hill saying we should go down this path again. you heard from the president in the clip you played reflecting exactly that. we were willing to do the last shutdown but not willing to do another one and it will be the democrats fault. that pressure has kept appropriators at the table last night and forced them to come to a deal to be voted on friday. scarlet: and talk that mick mulvaney and chief of staff was

looking at different ways the president can move around money for his beloved wall. trying to come up with ways to get around congress.has that come to any fruition ? >> absolutely.that is what we are to report today, which pots of money can be identified as a candidate to be shifted to the border wall. the big question is whether or not the agencies that would be responsible for this happy transfer authority to do that or it would have to come back to congress with a reprogramming request. chuck schumer has said that will have to be approved by congress as reprogramming, but it depends which line items are talking about whether they have the constitutional authority or not to do that. caroline: thank you for your time today. great to get your analysis. meanwhile, let's have a quick look at the markets. 500,25% on the s&p basically having the best day since january 30. emerging markets continue up as

the dollar goes lower for once. scarlet: currencies, stocks all getting a bit of a lift. one of the more crowded trades of the year so far. crude oil moving up. wti at $53 in change. this is bloomberg. ♪

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caroline: this is counter to the close. scarlet: joining us as always at this hour is romaine. romaine: glad to be here. scarlet: i know you have been keeping your eye on small caps. romaine: they are lagging but what is most interesting is today is the day assuming we close at the levels we are at now where the russell 2000 comes out of the bear market or at least the 20% threshold and same thing with the small caps 600. they have been the star of the show for the last few weeks of this rally. it has been the small caps.

everyone focuses on the large caps today , but when you look at the gains, think about this. three of the top five gainers today have market caps less than $10 billion. mattel, ouse, i these are made cap or small-cap companies. caroline: it has been the story of perhaps the dollar strength and how much that impacts the international companies. were looking at the s&p 500, it seems like technicals. shooting up against the 200 a moving average. scarlet: 2743 is the average and we are right at the level. one and the industry group, is a pretty broad advance. 24 industry groups. 21 of them are in agreement. the best performers are semiconductors. there is a conference. romaine: there is a semi goldman -- there is a goldman sachs conference.

relatively bullish statement out of the executives as you expect. scarlet: on the downside, you have interest-rate sensitive sectors as well. you are not really looking at big declines, especially when it comes to utilities off by 0.1%. caroline: a selloff in terms of going risky assets away from those havens. scarlet: this is what it looks like on an intraday basis. opening higher and building on strength. a real breakout from the last two days where we were meandering along. caroline: relaxation over potential shutdown concerns and notably some hope over the u.s.-china trade deal. scarlet: we are moments away from the close.let's take a deeper look at the action today . at one of the worst performers on the s&p 500, and that is gilead sciences. the biotech company falling today after the company said a

drug to treat liver disease failed. not good. still, the company is committed to finding a drug to treat the conditions. it is not coming through its own trials of drugs.it must be looking at dealmaking, which is maybe why we are seeing the reaction in its two big rivals. viking therapeutics popping. interest of pharmaceutical falling. analysts saying it is viking therapeutics that could emerge as the prime m&a target for gilead. >> it is honest happy hours a good time to start talking about beer, but not a good time to be owner of molson coors brewing today. shares down about 9% for the worst drop since last may. this is after the company reported fourth-quarter sales of $2.42 billion, which fell short of the $2.54 billion that analysts expected. the company announced it would have to restate results for 2016

and 2017 because of his treatment of deferred tax assets. but it is the continuing story of week volume growth. volume's sliding for a fifth straight quarter, especially in the u.s.. volumes down more than 5% in the u.s. as consumers drink beers other than molson coors and drink more wine and spirits. shares are down about 38% over the past two years. really a nasty period for this company. abigail: let's take a look at one of the leaders of the day, and it is under armour.shares popping higher on the day. up about 7%, on base for its best day since october. they beat adjusted earnings estimates and reduced inventory. but earlier the stock had been down coming on a disappointing guide for the first quarter. investors looking past it, and it could be the short seller. we are looking at the short interest in blue.relatively high

at 17.9% . but down all the way from its year to go high of 35%. we are seeing a bit of a short squeeze here. if they continue to put up results that are good enough to get a short value, just might see the shares of under armour continue to climb, although still down from the all-time high back in 20. caroline: good context. thank you. as romaine was mentioning, forecasts extending. now.joins us what do you make of the rally? >> a couple of points. we are at the tail end of the fourth quarter earnings season. we have gotten a lot of guidance for the first quarter. some of it has not been great.if you are a money manager and use at out january, you missed out on about 7.5% return to the s&p 500. as running was saying, small caps performing even better.the

russell was up 14% . nasdaq up about 11%. if you missed out on that, you have to figure out a way in the next month at half to show your clients that you are interested because otherwise, you are lag,ng, and the more you the more difficult it becomes to make up any lost performance. you got that as a factor. the second thing is if you take a look at all of these extraneous events, the government shutdown and the confab over trade, the government was shut down in january and we had a great january. it was the best performance in 30 years. so i'm not sure the shutdown is necessarily such a big deal to investors.although that does sort of give you an excuse to hit the buy button. as far as trade talks go, the march 1 deadline, removing that from the issues that investors

face, that may be a factor. nevertheless, you still have the same issues and you have prices of oil about $52 a barrel. oil at the pump, it is pretty inexpensive. it is under three dollars a gallon in most places. as americans have more money in their pocket perhaps, this needs the economy is pretty solid footing. you are sticking with us because with about 2.5 minutes to go over the close, let's bring in rene. the last time you were here was the crazy day on christmas eve. things are a lot calmer this time around. >> yes. i noticed, yes. scarlet: what are the reasons we are seeing the rally, whether it is more comfort with trade talks in averting a shutdown? >> you have to go back to why we fell in december. scarlet: really? >> yes. how much of the december loss have we gained back?

a lot. but why did we've also hearted december? i have a much -- i do nothing much has changed since december. many risks all coming together at the same time when markets are extremely delinquent at the end of december. what we are seeing is a reversal of that. i don't think many people believed or a minority believed that we are heading into a deep recession. 20%, 19.6% when i was here. we fall 30% in the recession. that was unjustified. we are seeing the unwind of december. what does it mean going forward? it needs valuations are as attractive as they were in november. and the idiosyncratic risks are still present but rotating. one of the good things happening here is perhaps u.s.

policymakers are appreciating what is the impact of dysfunctional polic, what is the impact of creating so much uncertainty in policy that even small businessman -- small business confidence fell. romaine: how concerned should we be about a low volume in the about 6.4 billione talking shares trading, which is below the average whether you are looking at long-term or short-term. >> liquidity has been falling for a couple of years. breaking news. >> it's absolutely not breaking news, but the collapse of liquidity in december, meaning how much of a price drop it took to sell x amount of shares was dramatic. >> wasn't it because people were on vacation? this happens on christmas eve. you had junior traders [over

talk] and now they are back. caroline: but we're down in terms of volume. >> if you look at the performance of the s&p 500, we are all the way back to december fourth. never mind december 24. it's almost as if that portion of the market didn't happen maybe because of tax harvesting, and traditionally, the first quarter of the year is when people put money into their 401(k) and buy stocks. caroline: and s&p 500 best day since january. the nasdaq is the of performer. the dow jones basically has nothing in the red. scarlet: it's pretty incredible in terms of how broad the rally is. we are talking about the 200 day moving average earlier. 2744 looks like we close right at that level. another benchmark, at least on a technical basis. >> and a lot of people are now turning their attention to these longer-term averages like the 50 week.

if we could hold above those, that's would be more of a bullish signal. scarlet: and i'm looking at the sector breakdown, the only decline or is consumer services and real estate investment trusts. else, 22 groups, are in the green. caroline: it was risk on in europe, asia, and now in the u.s.. i've been keeping and i on the output updates we got from russia and the energy administration in the u.s.. inn as opec plus cut sharply january, the white bars at the bottom of the screen, it couldn't offset or couldn't counter the huge rise in u.s. production. those are the blue bars toward the top of the screen. the net difference is still in positive territory. that is the yellow.

out to say itame was reducing its estimates for the amount of crude this year on the u.s. production, but also on weakening demand, we saw oil raise -- erase half of its gains. mike? >> the rallying and oil is also which is theewz msci brazil etf. that is up about 3% today. the state oil company is helping to drive it higher, not only begin in oil prices, but the shares were upgraded to buy saying they should gain as the company boosted production and invests assets. also, a crack in the rally of the dollar as the markets turn more risk on is helping brazilian rallies today. the brazilian central bank came out saying data is indicative of

a gradual recovery in the economy, so brazil is firing on all cylinders. abigail: let's take a look at the 200 a moving average on the s&p 500. we've been looking at this quite a bit. overall, over the last year, a sideways range and the battle between the bulls and the bears. we now have the s&p 500 closing above the 200 day moving average by a little more than one point four the first time back in december. we see these attempts suggesting it is still resistance. even so, being slightly above or below the 200 day moving average gives little noise of this chart. keep in mind, the rsi is trending back up toward overbought levels. suggest momentum will

stop and we could see the s&p 500 fall back down into the range. scarlet: abigail and the markets team, thank you so much. we got breaking news from akamai earnings. seven cents better than the consensus estimate of one dollar. aboute for the quarter is $10 million better than expected. they've named ed mcgowan to secede a change at the top. caroline, this seems to be something we are expecting. caroline: this is a relationship they've had for about three years. they're looking to have an online's payment collaboration in japan that would go live in 2020. they are expanding the global open network, as they call it, and it is now a joint venture. scarlet: we want to bring back our guest, but before we do, we will stick with akamai because

on bloomberg technology at 5:00 p.m. eastern time, we have a conversation with the akamai ceo. that is tomorrow, so we look forward to that conversation. we have more perspective on the markets at the close. gentlemen, i want to show you something from earlier about the crowded trades and trades you don't want to be in or want to be in. take a listen. >> the wealth of trade is u.s. stocks versus the rest of the world. what we've seen in the recent past is that the rest of the world has done better than the u.s.. that's will reverse. secondly, you have an interest rate differential in 10-year between the u.s. and germany going higher, not lower. i would look into a different currency. scarlet: i like the point he made about going long on u.s. stocks, because we heard from bank of america lynch which heard something different --

which said something different. caroline: it's long on dollar. have thought it was mutually beneficial, but mutually exclusive. romaine: i think there's a play that the rest of the u.s. banks will tilt into the dovish tilt. caroline: is it all about going long em right now? >> i think it makes sense to be diversified. what happened for several years was a huge outperformance by the u.s.. it's really important on the medium or long-term point to be and to not lose sight of long-term objectives. the u.s., it is obviously the richest versus competitors, and that is that they are lesser,

challenged, and so on. the point is to be diversified. romaine: you talk about the idea of being invested, and one phenomenon is that people are chasing yield anywhere they can get it. you see people flood into government bonds outside of the u.s., some yielding negative. >> why would you loan your money aaa government guaranteeing that you're not going to make any money? [laughter] it doesn't make any sense. unlessgoing to lose it you can find a greater fool to take those bonds off of your hand. romaine: isn't there a trade in their or two at some point? some people think they can play it off one side or the other. >> you have to find the person that still has the job to do that because you will lose your job if you keep losing money. you have a situation where

growth in the u.s. is better than growth in europe. everybody buys that. you have a situation in the u.s. where growth in tech companies, for example, which led the rally in 2018, that's continues even though you have problems with apple and so on. take a look at netflix, they are up 34% so far this year. are not even through the first quarter and the stock is up 34%. we've been talking about momentum for how long? everyone gets on the momentum train and the machine starts to take over, and you have to show you are invested in what is really working. so far, that is working. you mentioned negative interest rates, i think there are like three or four countries in europe that have positive interest rates. else has got negative interest rates. it's not working. that is what is so amazing, it's

not replacing the european economy. caroline: and germany is promising to undo its promising from a physical perspective. what is driving down these meals -- the fields -- these yields? they could perhaps find more positive yields to go and hunt. >> the regulatory constraints are jumping out of the market of where it is supposed to be. if you are a pension fund, you have to match or liabilities. >> how can you match liabilities if you have a negative interest rate? pay yourou going to people and 10 to 20 years if you are not getting any yield? >> is called regulatory forbearance. >> so you go back to the bank and ask them for more money. [laughter] romaine: i want to pivot earnings real quick. we've seen earnings estimates revised downward, what is your take on that and how concerned should we be? >> we expect about 4% eps growth

this year. it could be higher if oil prices were to go up. if it does better, maybe 5%. what is a technical earnings recession? over 12ave 4% growth months, it is possible one or two quarters are negative? absolutely. it doesn't mean very much. pattern, if you look at earnings forecasts and how they convert to reality, it's almost always in one direction. what we have had last year was a convergence -- divergence from the forecast. i think the old patterns coming alarmed, it we be doesn't bother me. caroline: a great perspective. pande.ou very much vanay

out. you for coming meanwhile, let's keep the markets alive. is a bitrs reporting of a mess when you look at a justice earnings share -- earnings per share -- adjusted earnings per share. revenue is just above the estimate of $342 million. we are falling somewhat after hours. tripadvisor is maybe monetizing itself when we have the likes of expedia and the ever-growing likes of airbnb. but for now, we fall after-hours. scarlet: we will keep an eye on akamai. as well as that does it for the closing bell and for me. coming up, by amazon and google are asking device users every

ore you turn on the light make a request. the privacy concerns ahead. this is bloomberg. ♪

caroline: live from bloomberg world headquarters in new york, i am caroline hyde. romaine: and i'm romaine bostick. caroline: here's how we close, up on the day. u.s. stocks in the green. it was a risk on rally. romaine: the question is, "what'd you miss?" caroline: optimism on the upcoming u.s. china trade talks and a tentative deal to avert another government shutdown. , a victim of the longest government shutdown, sentiments

among small businesses. it's taking a toll on business owners in government contracts. can i tell you everything? amazon and google are asking smart home users to share streams of information, including when they turn on the lights. this is good to be the year's biggest ipo so far, virgin trains. they hope to raise as much as $538 million tomorrow. the offering was expected to price below the market did range, and now it has been delayed. let's go to jonathan levin, our miami bureau chief. deal innot just a big being a big ipo, but the name recognition attached to it was richard brandon -- richard branson branding. this project has taken a while to get off of the ground. what accounted for them pulling

back the ipo today? statement isy's simply that they found alternative means of financing and are going to go that route. we can take that with a grain of salt. theyarket intel tells us pushed this back and are considering opportunities to come back to the equity market at some point in the future. the fact of the matter is, even before we got this news, we knew it would be tough to prices at the level they wanted to do so. this deal would have opened equity capital markets this year and would have been the biggest ipo of the year. then, it was a very speculative investment at those levels to begin with. the company has about 580,000 passengers to show for itself in 2018. it's looking to get the levels of about 21 million. caroline: exactly. there is still plenty of

disrupting it needs to do the learner and more passengers and prove itself -- lure in more passengers and prove itself. what is its aim? jonathan: this is a company that says it aims to fill the space between two far to drive and too short to fly. two major population centers separated by about two to 300 miles. they already have plans to move into the orlando corridor and taking people from miami up to orlando, and eventually, at some points, they look to acquire assets that would lead to a rail between las vegas and the los angeles metro area. romaine: what is virgin trains doing that amtrak is not already capable of doing? jonathan: i think they are trying to fill the void where

amtrak is not already there. ,ere in south central florida twoak only operates about daily trips between miami and orlando. those trips actually take about five hours, maybe more. virgin trains said we will give you a unique experience, it is sort of a luxury high-speed experience. it will take you about two hours less to get there and we will run many more trips daily. brand i knows a well. they operate plenty in the u k -- the uk. thank you for the analysis coming from miami. activation and blizzard, we have been all across the gaming sector. fourth-quarter adjusted revenue is $2.8 billion shy of the 3 billion estimate.

the forecast for adjusted , below is $1.2 billion the estimate as well. in 2019, overall revenue is well below the 7.3 which is where estimates are. this is a company that cannot win over and you have the all-encompassing threat of fortnite. romaine: we are also getting other earnings it. there fourth-quarter revenue is coming and above estimates. their etf's matching estimates and they give a fiscal revenue forecast above estimates coming in at about $1.07 billion. share is downe about 3% after hours on the initial headline. we will take a little -- dig a little bit deeper to see exactly what investors are reacting to their. coming up, -- there. coming up, 1984 in 2019? we have the details on two silicone giant's plans together

more of your data. this is bloomberg. ♪ this is bloomberg. ♪

caroline: it's time for look at what stores are trending across the bloomberg universe. readers are reading a skip option on a $1.5 billion bond. isnwhile, bloomberg.com reporting on the mass smuggling of goods outside of venezuela. the government in caracas heavily subsidizes food and fuel. food shortages and hunger have become more common in venezuela. the government has blocked american aid shipments from coming into the country. tictoc is looking at tokyo's

plans for the olympics. organizers plan to force the gamesmetals -- forge the metals. they expect to have enough devices for all of the metals by march. you can follow all of these stories on your terminal, on bloomberg.com, and on tictoc on twitter. romaine: silicon valley is watching you. amazon and google are working to expand the amount of data they collect. the tech giants are also working to make their smart seekers an essential part of a connected home. for more, let's bring in our reporter who will tell us about this. i understand the idea of why they want to do it, but the trade-off with them becoming more interconnected into our homes is this idea that we give up more of our privacy or sharing more of ourselves with them. why is this a good idea? matt: from the companies perspective, they want to offer you more bang based on how you

are using your items at home. let's say nine days in a row you lock your door about 10 p.m., and the day you don't, they will be able to remind you. can make more useful services based on how you use your appliances. caroline: i'm device agnostic. alexa, andgle home, i know they are probably going to be watching this data. our people surprised? should they be surprised? matt: you kind of understand when you ask alexa to do something that amazon will know about that action. i think what is less intuitive and that some critics are harping on the company for is that when you woke up a device to alexa, say the television, anytime you toggle it, alexa will have a record of that. as they sort of dig

deeper into our lives by collecting this data, there's a certain responsibility that comes with protecting the data and not using it in a way that the public is not aware of, something silicon valley has not necessarily have the best track record with in the past year. are these companies giving any insight into how they will ensure the data is not used for something other than checking our locks? matt: they make the case that for are the gold standard security. as far as what they do a data, they don't offer specificity. there's speculation that it could be valuable in advertising , but they don't seem to foreclose on many possibilities. caroline: what i like is that some of the quotes that you have in your reporting, you quote a lot of companies that are concerned by this.

they say it is over sharing for the sake of over sharing. what did you learn from these companies that make these devices? are they pushing back against amazon, google in terms of data they want? matt: they think -- i think they definitely are. users don't want to be on the hook if suddenly all of their users have their data controlled by amazon, and if something goes wrong, they don't want that responsibility. companies that make smart home devices are looking at the space and are worried about their strength in the markets. bit of folkstle eyeing it. caroline: that's a great piece. meanwhile, i will stick with amazon. they are coming to the cello -- cochella. any essentials to a locker inside of the music festival. they will create a custom storefront for the event. this takes place over two

weekends in california. i'm interested by this because i halfr how much they will to splash in cash to get it. romaine: the real question is, what are you giving up her this? how much of it to you really want in your life? it's a difference of personality. caroline: it's kind of a neat amazon music,sh the entertainment realm, and i guess it's good brand fit. i don't mind if they know i'm going to a music festival and will give me some cream on the back of it -- sun cream on the back of it. i only want to go at daft punk comes back. it seems the gloom in washington is spreading to small business sentiment. we go over the latest eco-data. this is bloomberg. ♪ this isn't just any moving day.

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mark: i'm mark crumpton with bloomberg's first word news. senate majority leader mitch mcconnell is praising appropriators for reaching a tentative border security deal that funds miles of new barriers and finishes the remaining spending bills needed to keep government funded be on friday. >> as we speak, our colleagues are working hard to produce a legislative text. i look forward to reviewing the full text as soon as possible, and help the senate can act on this legislation. bloomberg has learned president trump has not decided if you will support the bipartisan deal. following joaquin "el chapo" guzman's conviction, his

attorneys told reporters they will of course appeal. the attorney said the evidence against his client was "utterly and completely overwhelming." guzman the outcome, could be in u.s. prison for life. --this is not a case he was presumed guilty. i don't blame you guys, but it's very difficult to get a fair trial in america when the press is so overwhelmingly negative. i understand there were stakes that was dramatic and that was the lore of guzman, but today, a lot of this contributed to a myth of what el chapo is. mark: the defense case lasted half an hour. guzman's lawyers did not deny rimes. they argued he was a fall guy.

macedonia officially named north macedonia to end a decade old's dispute and secure its entry into nato. macedonia raise the nato flag edits main government -- flag at its main government location. resolved afinally dispute with greece dating back to macedonia's declaration of independence in 1991. 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'm mark crumpton, this is bloomberg. caroline: let's get a recap of the numbers at the close. and beatp 1.3% fourth-quarter adjusted earnings per share. million -- was tell

was 10 million and excess. interestingly, they struck a deal. it was a three-year relationship musj ins j in japan -- japan. it's all about the blockchain's. tripadvisor remains down by 4.3%. a miss in terms of their earnings per share. they're looking better, as did revenue. romaine: you also have twilio down. the earnings came in slightly at about what analysts were expecting but they gave a first-quarter forecast that is coming in like, but this is a company with 60% revenue growth year-over-year. remember, it is up about 600 plus percent since they went public in 2016. and you have activision blizzard

-- less than 1%. caroline: the gaming companies have really been in the line of fire. romaine: let's turn to the economy. u.s. small business optimism fell to a two year low. nationalfrom the federation of independent businesses suggests the shutdown drama in washington weighed on sentiment. numbers.over the tim, how much concern should i have about these numbers? the significant redesign small business numbers are falling back down to the numbers right elected.mp was tim: let's not forget the small business administration. tax rebates plus not being given. small business owners were worried about that. that weighed on sentiment.

itthe medium to long-term, is not worrying yet, but we're likely to see rebound of numbers. even with the slowdown that has happened in europe, and china, the u.s. economy is about the domestic production and domestic demand. that looks solid this year. caroline: in the jobs data is looking good today. we have a little wiggle room for the labor market because there are plenty of people that have been out of work for a long time. tim: that's right. one thing getting missed in this discussion, even as you allude to indicators at elevated levels given where we think we are in the cycle given how tight labor market conditions are supposed to be, there is a skilled mismatch happening. that means there are workers who don't have the skill set needed in some of these jobs that are changing. we have higher tech jobs and things like that. even though we have a tight

labor market, folks are missing out on that romaine: one of your colleagues -- that. romaine: one of your colleagues at bloomberg economics said there are signals in the labor first suggesting we may have a long way to go before we get to some form of normalcy. tim: i think that's right. we're definitely in a place where inflation is muted, but we expected to pick up. the labor market is supposed to be good this year. we expect job gains to remain above trends, and wage pressure should rise with that. inflation is likely to hit in the back half, causing the fed to raise more times in the year. if we are talking about normal in the sense that we are getting -- edging toward neutral, i think that is right. the last three months or not indicative of where the economy is. caroline: when you look at the , therem in the markets is a relief rally going on because of the china trade, because of the shutdown.

is it more about the relationship with china and how much the economy or corporate have been hit by that's relationship rather than sentiment? tim: i definitely think they are pushing out the trade deadline and that buys market optimism, buys the rest of us time to get a broader deal in place boosting optimism. fed of it is that the overstepped a bit in december. markets were already jittery and became more jittery. they stepped back a little bit and said [over talk] caroline: you are saying we will get one or two rate hikes at the end of this year. the market is not pricing that in. tim: i think that's right. i think they probably overreacted a little to say don't worry we are on pause for a while. the data will show we will need hikes at the end of the year. romaine: tomorrow, when we get the cpi data, we are looking for something like 0.2%. intoo you translate that

the fed getting to two hikes by the end of the year? tim: 0.2% is where we were for the last couple of months or year, so that wouldn't necessarily be a disappointing number. inflation lags growth. last year, we had strong growth so it will take time for the speed to pick up through the economy. seeing growth strengthen in the middle of last year means we will see inflation in the middle of this year. as long as we stay above trends, we will see inflationary pressures go up. caroline: it's great to get your perspective. meanwhile, the u.k. is slower than expected in the final quarter of 2018. meanwhile, bloomberg tv caught up with david haro earlier today about this lingering uncertainty . -- in weakness in in uncertainty means lower prices despite positive

business developments. that becomes a reason to add to our positions. we have to make sure we have a good notion, good idea on what the transit value of a business is despite what is happening in the macro environment around it. these are inputs that go into process, and of price drops significantly and value does not, this becomes an opportunity. >> how clear is the length between intrinsic value? that is something you focus on. in the macro effects. the intrinsic value of u.k. companies going down, will adapt to the brexit vote? >> the share price certainly did. instances, you didn't see a major decline in intrinsic value. intrinsic value is a function of the cash flow stream of that business. all of the cash flow stream, today's, tomorrow's. this is the big opportunity for an active investor.

noise in the geopolitical atmosphere. atmosphere measures over medium and long-term prospects. when price divorces itself from this reality, it becomes opportunity. it's something like a brexit or the italians fighting with the europeans. any political instability is more noise than actually impacts the fundamental ability of a business to earn money. >> if you wind up seeing the value right now, where specifically is it? what stocks and what sectors? aref you look at where we weighted today, you see a heavyweight toward european financials. it's a broad mix of financials. what has happened is all of this political noise, every time it gets cranked up a couple sectors, people use this

as a way to play the noise by shorting it or selling these stocks. >> justifiably because a lot of particularly in italy. santander is in the hot seat. there's a reason it's a proxy. >> it's a poor proxy because you bring up npl's. is mpl situation in italy significantly improved. look at the npl's, they barely moved at all. this is the point i'm trying to make. there are aspects which impact the bank's fundamentals. this uncertainty means lower rates for longer. that delayed interest-rate normalization and that's generally not good. that the banks are not can you be able to grow because of uncertainty, this is

not good, but npl's are down. costs are down and fees are up. earnings are maintained at acceptable levels. growing at a slow rate. caroline: that was david herro of herro associates. in a bezel -- we will hear from representative next. this is bloomberg. ♪ s bloomberg. ♪

caroline: lawmakers have brokered a deal on border security. it's now up to the president to

see if it is good enough to avoid a shutdown. the president said while he is not happy with the proposal, he may back it. let's get with kevin cirilli standing by with a member of congress. >> where joined in studio with congressman riggelman. i was at the white house earlier today, when the president was making the remarks, saying he will have to wait and see on whether he gets on board. should he? >> we haven't even seen the final text yet. we haven't seen the final text of what the democrats proposed and what the bipartisan look would be for this bill. president trump doing his own markup. we are waiting for the final bill to see what drops and see what they give us as a final number for border security. abou miles ofillion, reduction in beds or

number of arrests. that's will below the $5.67 billion the president demanded for the wall. do you think the president will be able to sell this to republicans? is this enough money? >> i think it will be difficult in my district. i think we had over 1200 overdoses last year, and my district is huge. it's bigger than new jersey. for me, i don't think it is enough. i'm frustrated with the process, and in the meetings, there's a lot of frustration a cousin we don't know what the language will look like. more than 55 to be miles of fence? i don't know. that's will be a hard sell to my district specifically. kevin: so it's not enough for president trump -- if it's not enough for president trump, you think you should take this money and the clara national emergency? >> i would rather he didn't.

i would rather a congressional decision to this. we still have to friday. my district, iran on three was border one security but comprehensive immigration reform. before you do anything with visa reform, we have to have a secure border. -- with mynd background, there are ways we can do this. i find it frustrating the does i don't seaboard a security as being controversial. kevin: i want to talk commodities and your work on the financial services committee. it trending in the right direction that there will not be a government shutdown? >> i think it is still trending in the right direction based on meetings today. i don't want to give false optimism. and moderate core democrats with republicans pushing this, i think we are trending in the right direction. kevin: when you look at the uncertainty this is factoring into how businesses and traders

are factoring this into their decision-making, you couple in trade policy then and treasury secretary mnuchin and bob lighthizer headed to beijing, you come from a small business owner and these commodity prices do impact that industry. what would you like to see the president do in terms of trade negotiation with china? >> if it's looking good, my district is very agricultural. timber and tobacco are our top commodities. the timber guys are ok with this . tobacco, not so much. it's an interesting dynamic in my district. in talking to everybody, i believe we are on the cusp of a deal. i took a briefing last night and china is hurting more than you think. i think they have a 12% cut in car sales over the last quarter. this, i think they are coming to the table. i think president trump will lay off of this increase.

kevin: why -- this next tariff increase? kevin: why? >> i think he will do it. kevin: a lot of folks in the business community are concerned about the march 1 deadline. >> for us, we spent about another $400 and we have soybeans in our district. there's a lot of things in my district i want to take care of. , however,r free trade i think we are to a point where we need to close a deal with the chinese and move forward. kevin: are there a group of republicans in the house that are urging the president, pressing the president not to do the tariff increase on march 1? >> absolutely. you are looking at huge districts like myself. i'm in an interesting dynamic. in the south, when i say

agriculture, if you are used to pennsylvania county, i have a push.ve agricultural there are so many interesting issues that i have in the district that i have to look at. let's get something done with china right now, and let's move forward on the straight policy. met -- it has been busy. i met with people yesterday and we are getting an in depth look take eachnd we will piece to look at how it affects each district. i think it's a good first step. i don't think it's the final solution. riggelman, wesman appreciate you coming in studio. romain, back to you. romaine: that was their chief correspondent, kevin cirilli.

coming up, president trump's his stance on the trade battle with china. we will have the details, next. this is bloomberg. ♪ berg. ♪

caroline: it's that time. asia ahead. u.s. and china trade tensions might be easing. he is ok withlier extending the deadline passed march 1 if they can come to an agreement. are we surprised? >> not really. we heard from the white house advisor saying the president wants a deal. she also said he was really looking forward to meeting president xi jinping. it was not that much of a surprise, especially given the reason this could really happen in a meeting with xi jinping, it was more of a scheduling issue. the koreaneet

minister at the end of the month. talking we were just about how china was scrambling to make a deal, and now i think it is the u.s. scrambling to make a deal. what do you hear on the chinese side of things? are they waiting for trump to figure it out or is there a game plan? shery: we talked a little about this yesterday. has allsaying the u.s. this leverage because of the economy,of the u.s. but at the same time, we see the chinese economy and how policymakers controlled the whole economy. what thesusceptible to public says, but it's a different level of politics in beijing. at the thing time, the chinese economy is slowing down and it is not great news. yesterday, we heard about corporate defaults or missed payments when it comes to these two large borrowers. as you can see from this chart on the dtv library, -- gtv library, the pboc numbers, they

have not moved from a key lending rate since 2015. can seeop panel, you they tried other tools like the triple r reserve requirement. policymakers in china do have more options on the table. caroline: what about investors? how are they looking at china's deals? we hear from corporate america that they are still in china, yes it is hurting, but they are still in their. shery: yesterday, we talked to the u.s. chamber of commerce executive vp and he was telling us about the issues these companies face when they are trying to do deals with in china. take a listen. the chinese government likes to point to the fact that there is not one central government policy, but there are issues standards, conformity assessment, cybersecurity laws, and all of these issues make it andicult for u.s. companies

foreign companies investing in tech related businesses in china without being required at the local level to offer up technology that they don't want to otherwise do as part of the deal. shery: what was really interesting about his comments was that he was pinpointing to the force tech transfers which is one area that has not seen a lot of progress. when we talk about ip theft and protection, we've seen the chinese implementing new ip laws to protect foreign businesses. we've seen them set up ip disputes appeals court this year, but when it comes to forced tech transfers, there are many other issues at play. caroline: great perspective as always. thank you for your time. tune into "bloomberg daybreak: asia" at 6:00 p.m. eastern. cpiwhile, numbers on u.s. are coming out that 8:30 a.m. eastern. that's all for "what'd you miss?" "bloomberg technology" is up next in the u.s..

romaine: have a great evening. this is bloomberg. ♪ ♪

emily: i'm emily chang in san francisco and this is "bloomberg technology." next hour, thee debate over your data. amazon anda like google are expanding their information empires as they grow into our homes. toivision is planning dramatically slash costs after reporting fourth-quarter results that missed estimates and delivered a disappointing forecast. can they turn around amidst competition from