e. scarlet: every etf's a new way to look at things and the ipi can update its parameters. we are looking at the indexes holding onto gains, at least for the s&p and nasdaq. not clear whether the dow will finish higher or not. volume has picked up as well. for the dow, 22% above the 20 day average. nasdaq has closed at a record high. maybe not. no, it did not make up yesterday's losses. not so fast. we are looking at the russell 2000 underperforming a little bit. i made all of this, let's not forget tesla has done incredibly well. it is up 4.1% on the day. over $100 billion. joe: he has to hold it for a

little while. it cannot just be one-day. scarlet: let's dive deeper into the action with our markets reporters. >> i am thinking about the dow transport. they are underperforming in a significant way. this is a charge, down on friday. the real declined yesterday, down 2% on the virus outbreak and he fears it will spread and curtail international travel. down 0.7%. ,his is the major averages putting an all-time highs. you want to look at divergences. we see the dow transports over the last year stuck in a range. above the top of the range, now heading down onto it, look at the rsi or momentum indicator, slightly in overbought territory last week. transportsthe dow continue to decline. if that happens, it may suggest the major averages could cool off. the divergence i am focusing

on is between stocks and bonds reminds us of the start of 2019. it is not how we were acting and the second half of last year. chart.ake a look at the you will see the bottom panel, the two are the most negatively correlated since the time period of lot june, the aftermath of jerome panel -- jerome powell saying the federal act as appropriate. most strategists are saying the juxtaposition with the rally and equity markets becoming increasingly untenable and any attempt to time this correction is met with negative carry. here is why. the highflying parts of the equity market this month have been duration sensitive. the ipo etf closed at a record high yesterday. utilities is a deal sensitive.

we set, most overbought in history. expensive software stocks got run over in last year's big rotation of values, that looks to have petered out. those are up 10% this year. >> i am looking at shares of texas instruments. it looks like revenue for last quarter was $3.35 billion. better than expectations. we are still looking at consecutive straight quarters of -- that forward guidance in the first quarter, next quarter, , $3.4g at revenue billion. that is versus estimate of $3.2 billion. analysts are happy about pushing shares up. interestingly, if you want to look at a chart here, despite the declines in revenue growth, still trading near record highs. so his evaluation of the stocks

index, relative to the s&p 500. so much of these stocks as texas instruments kicked us off, leading a lot of the gains, setting a high bar. joe: thank you. bannister,us, barry head of equity strategy in bloomberg cross asset reporter sarah ponczek. we are starting to get into earnings season. we are starting to get enough data and a lot of the thesis was that in 2020, we would see an earnings acceleration that would justify what we are seeing in equity prices. i am curious what you are seeing so far is enough to give you a read on if the fundamentals of 2020 will arise, accelerate in line with what people are

expecting or wishing. back on 2019,ook we were $10 below the street on s&p 500 earnings estimates and the street came down to us. we made a mistake by underestimating the degree to which the p/e ratio would go up on the rate cuts. the market it did better than we thought last year. this year, if we have a continuation of disappointing earnings, my estimate for the 167, that continuation of an earnings recession would weigh on the market at some point. scarlet: one is that point? we see declines right now to look at the upside of everything. barry: if you think about the yield curve, the yield curve inversion, using a 50 day moving average of the curve, which

filters out the noise, it has never given a wrong signal for a .ecession if i were to see a lack of earnings lift off and return to a curve flattening, particularly a bowl flattening, it would be a sign that the second half could look week on the growth fund and there would be a disappointment in the market. we cannot carry on with liquidity forever. we need growth. scarlet: it has helped for a while. , there has noticed not been a lot of buybacks. it is down 7% from last summer's peak within the s&p 500. ticking away a source of demand that was helping push stock prices higher. what does that say if companies are not plowing money into their own shares? do they think their stock prices are overvalued? sarah: maybe buybacks have been

coming down if you look at the amount done per share. we are also coming off of record. you look back after the tax cuts, the amount of buybacks we did see companies performing were at record highs. it is probably natural for us to see this tempered a bit as the windfalls from the tax cuts. it does tell you something, the fact that even if we are seeing buybacks started to temper, we are seeing companies not continuing to buy as many shares as they did in the past. the fact we are seeing a resilient market. that speaks to the fact that this is a market that wants to go up and even if you do not have the support of companies and buybacks to catch any falling knife, this is a resilient market. joe: let's talk about sectors. for five minutes in october, there was this talk about a

rotation from big tech to cyclicals, maybe the phase one trade deal drove part of that. that has not been sustained. tosee big tech continuing soar and today we see the nasdaq outperforming. do you like cyclicals? is there an opportunity for some rotation or do people pile into what is working? within the s&p 500 sectors, utilities, consumer staples, communication services are the only ones that i would call defensive. everything else is cyclical. technology is part of cyclical. a more rapid cycle. energy is a in its own way. very dollar-sensitive. if the dollar index were to fall, for a variety of reasons, energy would surely rise.

industrialsals, tend to be later cycle. they require better gdp. the financial stocks need a curve steepen or and a bowl flattening would be very negative. i think the broader cyclical on brother, which has been led by tech since october, does need to do out, branch out, as we go through this year. otherwise, it is terminal. scarlet: what are you hearing from market participants about the risks that are out there? ,taly and political chaos there it is not chaos, confusion, whether they will have to set up a new government or not. the government -- the conversation coming out of davos with the climate change and the virus where we do not know what is to come. sarah: whenever i talk to investors, i talked about the biggest risk for markets. one is earnings not coming into

where they are supposed to be, expected, or not hitting single-digit gains this year, that would be an issue considering where evaluations are right now. where they are supposed to be, they say inflation coming back, maybe the fed would have to step into play, that is not expected. to fed is seemingly stopping pump up their balance sheet. at the same time, they typically say an external risk is on no one's mind. we have to this year with iran and with the virus. neither have been large enough to kick the stock market off its path. shows you there are these external risks out of their that are not top of mind that could come from the four and catch people off guard. thanks. our that does it for the closing bell. at the impact -- economic impact of the buyers as

china seeks to contain it. this is bloomberg. ♪

♪ scarlet: live from a bloombergs headquarters in new york. here is a snapshot about how stocks close on the day. we finished higher for the s&p and the nasdaq. at the dow pulls back slightly. joe: the question is, "bloomberg markets: the close -- the question is, "what'd you miss?" earnings bronner,

texas instruments setting the tone for the chipmakers and a broader tech. aiming to silence experts accused of -- the saudi crown prince of hacking jeff bezos phone to muzzle the newspaper he owns. economists warning china's economic could be at risk if authorities fail to contain the virus sweeping across asia. health officials raise to gauge the danger of the virus. cases have stretched to five additional countries including the first diagnosis in the u.s. what is the latest you are looking at? has delayed that declaration. we are expecting them to reconvene. i not also rated -- also -- china raised the number of deaths to 17.

authorities have , tryd off rail services not really trying to contain this virus. scarlet: companies that have operations in china are also responding. taking extra measures. >> especially when it comes to travel. ford, all restricting travel to the city. not to mention tencent. on year holidays are coming friday, which is why this is concerning. you will have thousands of chinese people going overseas. tencent, who ann dowd red packets -- who hands out red packets, they will stop doing that in person. joe: the story of china's economy, it has been weak for a while. there have been hopes the try deal would help. we have seen the strengthening

of the currency. how much to the measures being taken to address this threaten that recovery? >> we can compared to what 2003.ed in we have see the chinese economy stabilize. now, factoring the sars outbreak, 17 years ago, the chinese economy was different. this is what is concerning. we are talking about the impact on the global markets during sars with commodity prices falling. it is the structure of the chinese economy. back then, it third of the share of the economy was a small. now you are talking about china being led by consumption, terrorism, leisure. if you have this virus and fear of the spread of this virus, that can hit the economy. even if it is contained within china, the chinese economy

against the world economy has grown exponentially since 2002. back then, we are talking about 8.7% of global gdp. now it is almost 20%. 1/5 of the world economy. even if it is contained, the global impact can be big. the china gdp numbers, a percentage of the world gdp, at the white light is the market, the financial markets growing. scarlet: i suppose it is good news in a way that this happened before lunar new year began. already inere transit, imagine how difficult a task would be. >> a lot of people that have spoken to people in the city, our reporters, talking about people still planning to visit their family. this is a traditional, big

holiday for chinese people. these airlinesed tickets, plane tickets, the likelihood is a will try to travel. we can take relief that the chinese government is looking at all of these transportation methods to try to weed out and contain this coronavirus. joe: tomorrow, we get another world health organization meeting. weifficult topic because expected them to make some announcement today and they said we are meeting tomorrow. , and we doayed it not know what is taking so long. they could come out with a declaration that this is a public health emergency of international concern and what this would mean its potential recommendations for restrictions on travel and trade. scarlet: thank you so much for

staying on top of this story. theavel halt because of outbreak of the coronavirus. for more on these stores, do not miss daybreak a stronger and daybreak asia. we had earnings as the closing bell rang. it texas instruments, first quarter revenue, if you take the midpoint of their range, it was slightly above analyst estimates. perhaps not high enough for investors because of stock has lowered in after hours trading. this is bloomberg. ♪

♪ we have texas instruments reported earnings 20 minutes ago. outlook is slightly better

than what analysts anticipated. first quarter revenue from $3.12 billion to 3.3 billion dollars. slightly higher than what analysts were looking for. ended, aisas for the quarter tt -- let's bring in a bloomberg intelligence senior analyst. texas instruments shares falling in after hours trades even though the numbers were better than expected. is this not high enough? anand: we are coming off a year where the stocks katie 60% -- stocks gained 60%. perspective,tation it is pretty high. a volatile semiconductor revenue company. this is a steady as she goes. we seem to have turned a corner

from a revenue perspective. for texas instruments. if you look at auto sars, it will be flat, better than 0% this year. we seem to have a china-u.s. trade deal, phase one, on a relative basis, that is positive. all of those should have b.i. sales bottom and go up from here. joe: we have been having you on every quarter to talk about chips for years. a point you made it a while ago, we used to think of chips as a cyclical boom bust cycle, inventory accumulation, what we have seen in recent years is this secular shift. more tips and more things. when you look at results like texas instruments, is there any evidence of that slowing down? that many people shift in more chips and everything? anand: semiconductors are the

new industrials. they are the building blocks of this generation and the generation beyond. block building technology, we need to have diversity, we need semiconductors everywhere. you are seeing that secular strength plane through. if there is going to be volatility, but cycles of dramatic expansion, those are behind us. we are starting to see shallower cycles. we are seeing quicker inventory corrections. the supply chain has become more efficient, very efficient. i think that volatility has been taken out. you are seeing investors say, this is a broader play for me, this goes everywhere. growth,a gdp plus 2% margins are expanding because they are efficient. when you look at it that way, it is a great way to play the

broader economy. scarlet: what does this mean for a company like intel? anand: intel is more a in its focus. less handsets now. it is going to be more focused. intel has specific challenges from an execution perspective relative to amb, which has been executed beyond belief. i want to see some of those challenges, if intel wants to hold its own. scarlet: thank you. red light about how semiconductors are the new industrials. it is a new year, perhaps there are new opportunities. the opportunity now may be to protect the gains raised in the last year. you will want to check out this week's there is an etf for that. year of the rat is upon us, the about brings a focus on wealth and surplus.

a tail risk etf seeks to maintain wealth by getting downside market risk. infestsunder tail, it infests -- since they gained a value whether u.s. stock market falls. it is not about -- not all about option. it is invested in a treasury bond. the fund attracted sunday $5 million in assets. because tail is meant to hedge against rising volatility, the fund will often produce negative returns in years with rising markets or declining price swings. that is what has happened with tail in the red since launching in 2017. light with oneen warning for its actively managed status. food for thought but when ever they does eventually go down. iq at 1:00ch etf

eastern time. of previously owned u.s. homes jumped in september. there is a record low number of houses on the market. historically low interest rates continue to attract riders, an annualose 3.6% to of 5.5 million. tesla's market value climbing past a volkswagen for the first time ever, more than 100 billion dollars, a threshold that will trigger a payout for elon musk, but only if he can sustain it for months. on paper, the report could be worth $300 million. that is your business flash update. coming up, analysis suggests jeff bezos had his phone hacked by the saudi crime -- saudi crown prince. this is bloomberg. ♪

mark: the house impeachment managers today began prosecuting their case to remove donald trump from office, accusing the president of a corrupt scheme that undermines the integrity of u.s. elections and puts the country's national security at risk. >> when you focus on the evidence uncovered during the investigation, you will appreciate there is no serious dispute about the facts underlying the president's conduct. and this is why you will hear the president's lawyers make the astounding claim that you can't impeach a president for infusing

-- for abusing the powers of his office, because they can't seriously contest that that is exactly what he did. mark: chairman adam schiff opened the arguments by invoking alexander hamilton and the concerns of the nation's founders about foreign influence over the u.s. government, corrupt bargains, and uncontrolled demagoguery. michael pompeo says he would be happy to testify if he is forced by law to do so. pompeo told bloomberg's hasington correspondent he not been following the trial unfolding in washington. init almost never comes up meetings with my counterparts. there is too many important things going on in the world. america is a close partner with countries in the caribbean. they are such good friends and allies.

they see the noise in washington but it is not something they would raise. mark: secretary pompeo also tells bloomberg the u.s. is committed to supporting ukraine and stamping out corruption in that country. he denies that president trump attorney, rudy giuliani, overshot -- oversaw a shadow foreign policy toward ukraine. china is taking steps to contain a respiratory violence that has killed 17 and second hundreds. the city of wuhan will expend all outbound -- will suspend outbound flights and rail services as well as other transportation like buses and subways. officials say citizens should not leave the city against -- unless necessary. there has been one diagnosis in the united states. the u.s. and france have struck a deal on a global framework for digital taxation that inverts a transatlantic trade war.

france agreed to delay a tax on multinational digital companies until the end of 2020. the u.s. will refrain from imposing punitive tariffs on french goods. the french finance minister spoke with bloomberg before the agreement was reached. >> we are ready to push for the until the end of the year with the view of finding an international solution at the end of 2020. if there is not, we would get rid of the national taxation and replace it by an international solution. mark: the u.s. have threatened tariffs on french wine, cheese, and other products if they went ahead with the digital tax. global news 24 hours a day, on air and @quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm mark crumpton. this is bloomberg.

new analysis suggests that saudi crown prince mohammed bin salman hacked the phone of jeff bezos in 2018 with a whatsapp message that contained code and breached the billionaire's phone. for more, let's bring in matt day in seattle. extraordinary story. or 2018, how19 modern it is. crown prince whatsapping with the richest person in the world, hacking his phone by sending him a link. what is the evidence? what have they discovered that suggests that mbs was behind such a hack? matt: mr. bezos hired a security consultant who gave him -- consultant and gave him a blank check to figure out who hacked into his phone. there were indications things had gone missing. they got to work doing a

forensic analysis, had people looking at it day and night. what they found was after this whatsapp exchange with mohammed bin salman, an unsolicited message comes in. after that, large volumes of data start vacuuming out of the phone. there is no direct view to the potentially malicious code that would be at fault, but they did note the very suspicious timing element of that message arriving and suddenly a lot of data leaving the phone. scarlet: why would the crown prince want to hacked jeff bezos's phone? matt: his security consultant has raised the well-known crackdown by bin salman on saudi dissidents, among them jamaal khashoggi, working for the jeff bezos-owned "washington post at the time, later murdered by saudi agents. it was before that, but the , from jeff bezos's

security consultant's perspective, they may have been looking for leverage against political opponents. scarlet: what about the technical -- joe: what about the technical aspects of the hack? what are the concerns it raises about whatsapp and the use of that phone as a vector for hacking someone's phone? and other security questions that this has brought up, if this is even possible. matt: the fact it is possible at all is a warning sign for everybody. if the world's richest person can have things escaped out of his phone without his notice for some months, that is a big red flag. it enhances this by craft that can be done on smartphones, at times without even your knowledge. the security consultant report indicated there was no obvious download to bezos that would suggest something that was occurring. scarlet: any response from saudi arabia on these findings? matt: they have denied it.

they asked for a full accounting of the evidence behind this, which presumably with both united nations investigators saying they believe this report is credible. they leaked the text of the report to vice news. i have not seen any response to their fuller findings. scarlet: incredible story. matt day in seattle. it is stuff you can't make up. joe: it is a very modern story. scarlet: it is -- if you were to write a tv show or movie based on this, you would say no way. mike pompeo says has a lot has found a home in venezuela, along with other countries. he sat down with kevin cirilli to discuss what role that organization plays in the region . >> when folks think of hezbo

llah, they think of syria and lebanon, but it has put down roots throughout the globe. multiple countries having designated "star wars: rise of skywalker -- having designated hozbollah as a security threat means we can work together to stamp it out. backed terrorian organization has found a home in america's backyard. >> it is something we have been talking about for some time. when you see the scope of what the islamic republic and iranian tried tos done -- they kill someone in the united states, assassination campaigns in europe. when we say iran is the leading destabilizing force in the middle east and throughout the world, it is because of this activity they have spread as a cancer around the globe. kevin: in germany and berlin,

you met with world leaders, including german chancellor angela merkel. i am sure you talked about iran, but europe has not always followed the same strategic route as the united states when it comes to iran. did your meetings with european leaders move the needle in that direction? >> we have a different view on the right way to proceed to ensure iran never gets a nuclear weapon, that their missile program is contained, and terror program is pushed back. we just share a different view about how to proceed. if you see what iran has done in the last few weeks with nuclear distortion, threatening to leave the mbt, i talked with my european counterparts. they have taken a step under the jcpoa to invoke the dispute resolution mechanism. i think the world can now see that this rogue regime has no intention of complying with the

tenets of what that agreement contained and the world must unite to ensure iran never has a nuclear weapon. i saw president macron say that yesterday. we need to work together to achieve it. kevin: how did you get iran to come to the united nations to work with the international community? aside from the sanctions and various military response options. >> ultimately the people of iran will get what they so richly deserve, a regime that behaves consistently with the values of the iranian people. in the end, the iranian people will demand to their government -- you see the protests, you see it when they walk around american flags that were put down by the american -- by the islamic republic's leadership to walk over. people go out of their way not to do that. this is about a regime that has treated its own people terribly.

even now the iaea is trying to figure out how nuclear material got to places that iranian leadership said it would not be. this is a global risk. president trump started his remarks the night after an american response by saying, iran will never have a nuclear weapon, it is our primary purpose, but we have a broader objective. we want them to behave like a normal nation and reenter the community of nations. joe: that was our exclusive interview with mike pompeo. from new york, this is bloomberg. ♪

scarlet: there is a market developing for hemp, but investors lack an accurate read of supply and demand to price

the goods. julie lerner wants to change this. her company panxchange launched the first suite of benchmark hemp prices as well as the only investment-grade industrial hemp trading platform. the problem you are solving is there is not enough transparency in pricing and you bring that pricing to light. >> absolutely. if i may make a small correction, we have been offering these prices for the year. in farm bill came out december 2018. with less than a month, we issued the first suite of benchmark prices. joe: is your vision that at some point this becomes a benchmark -- a futures market and we see industrial hemp traded like with oil futures? >> absolutely. market, it is the fastest moving in that direction. people want a derivative to price hedge with. scarlet: what's the difference

between cannabis and hemp? this is a question i am sure you get pretty often. a lot of people use it interchangeably without understanding the difference. >> technically it is the same plant. by sight and smell, it is identical. it farm bill in 2018 said if has less than .3% thc, it is industrial hemp. joe: i have heard when it comes to cannabis, there are many different strains and people have different cultivation's and it is very different in many different ways. would that make it so you can't really do the same thing? even if we were to have national legalization of cannabis in this country, that it would not lend itself to a commodities market in the same way? >> that's exactly the case. the issue with cannabis is that commoditization are terms -- in cannabis, you have

the redheaded stepsister and all of these cute names, which is branding. it doesn't tell you anything about potency, how much indica. for that reason i don't think cannabis will be an exchange traded derivative the way hemp will. scarlet: you provide an accurate read on supply and demand. what do supply and demand look like right now? >> this has been a challenging year with regard to getting those numbers. usda does not even have those numbers. they were going by planted acres this year. there are some people that took a stab at demand and they did it by market value. that's great if you are a consumer packaged good company, but that market value -- they are predicting they will go over $20 billion in the next few years. that's exciting, but when you backed that off to actual

physical supply, it does not look as good because you are talking about a retail product -- one ounce is your tinctures, your typical product -- 500 to maybe 1500 milligrams of a cbd product in it. that bottle retails for $60 to $90 on average. it is very misleading when you back it off to actual physical demand. in our december report, we took three different scenarios on how to get our arms around demand. one of them was taking public data. they made it to $95 million in revenue on less than 500 acres of hemp. joe: what are the mechanics of deriving an index? there is no exchange so you can't just go down to the floor. different producers deal with different suppliers. how do you feel you can come up confidently with a number that represents the market? >> i am glad you asked because

we take that number very seriously, especially in an industry so young. we had investors calling us, saying i am seeing your prices in the deck. these are farmers talking about, do i go, do i mortgage the house? we take this role very seriously. ete first thing we do is v our clients. de only take prices from vette producers and users. the next thing we do is follow the european price reporting agency guidelines. every number is documented, weighted. what trades on our platform has the highest weight. a bid on offer would have a lower weight on that. joe: fascinating stuff. our thanks to julie lerner, panxchange founder and ceo. time for smart charts, where we look at topics through the

charts. abigail, you are looking at a market you have never looked at on smart charts before. abigail: i was surprised when it was suggested, but it is a great chart, and to present it is walter zimmerman. >> cobalt is what prevents lithium-ion batteries from blowing up. abigail: important. >> when electric cars got popular, it spiked from 23,008 on.the 95,008 a t at the top, everyone was saying, there is no cobalt, china owns all of it. battery makers realized, we need a battery without cobalt. tesla is very close. minds that were not profitable down here were wildly profitable up here. the bubble burst and it fell to 25,000. abigail: a big boom and bust.

let's take a look at gold. that had a big boom and bust. do you think that could happen again? >> absolutely. to 1046, 618 retracement was 1608. it hit 163030 and got hit pretty hard. here -- this is da leg up, this completes the b leg up. the downside is the test of these lows over the next few years. guestl: you are the first in the last year and a half to have a bearish view on gold. what are you looking for for confirmation? >> if it takes out this prior low, that would be enough. this is a clear five way move down. cd this is a clear a, b, pattern.

abigail: the real crash, palladium. i think even to the novice eye, it is clear we are going to have an issue for palladium and this parabolic uptrend, which is really quite extraordinary. here it is. >> this i am calling the reincarnation of cobalt because we are hearing the same thing up here at 2480 that we heard in cobalt at 95,000. china owns all of it, there is nothing left. , iyou do a wave analysis have the 2550 area for a high probability t working on the price patterns coming off that low. abigail: it looks like a parabolic uptrend that could easily reverse. walter zimmerman, thank you for joining us. from new york, this is bloomberg. ♪

endedt: u.s. stocks marginally higher today as investors considered the economic implications of the coronavirus in china. earlier the vice regulator of consumer securities regulators sat down and davos to discuss the outbreak as well as the phase one trade deal for the u.s. >> obviously it is a challenge, but if any country can deal with this kind of challenge well, it must be china. i have no doubt that our government and people will be able to deal with it in a timely manner and the damage to the economy will be limited. >> do you worry that it comes ahead of the new year celebrations? butt is unfortunate timing, you cannot control the breakdown of a virus. effect it poses is

inconvenience, particularly to wuhanom will hand -- from . >> let's get to the phase one agreement between china and the united states on the market side. i am going to get your sense of where this is headed. by april 1, 2020, china will eliminate the foreign equity cap for securities companies. is that right? >> yes. >> china will eliminate the foreign equity cap for fund management companies by april 1, 2020. >> of course. >> one outstanding concern, there is a rule that caps foreign holdings of listed companies in china around 28%. >> 30%. >> can we do something there, achieve something? >> i think there is a potential to raise that cap to more than , because there are a few

other countries like japan, korea, there cap is around 50%. why shouldn't china do similar things? of course this has to go through a quite long process in our decision-making system, but in principle that's possible. >> how quickly? >> that depends on how many companies are hit. right now we only have about two or three companies that hit that limit. but we have 3800 companies listed. we will see. it is a good thing about china. our decision-making is responsive to the demands, requirements, needs. we always take their needs into account. scarlet: that was the vice chairman of china's security regulatory commission. don't miss the reports after the

bell tomorrow. joe: i will be watching jobless claims, out at 8:30 a.m. eastern. scarlet: that does it for "what'd you miss?" "bloomberg technology" is up next in the u.s. ♪

riggs in fortaylor emily chang and this is "bloomberg technology." the united nations links saudi crown prince mohammed bin salman to the 2018 hacking of jeff bezos's phone. we will have details and calls for an investigation. plus, smaller and cheaper. apple suppliers will start assembling a new low-cost iphone next month. ip