>> we are looking at a more hawkish fed. >> we are in a chronic labor shortage that is not going away anytime soon. >> we keep having the problem of the recession coming back and hitting us again. it is called covid. >> we risk a policy error at this point. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. kailey: good morning on tv and radio. kailey leinz, damian sassower, and guy johnson in. santa claus has already come to this market. guy: he was always going to arrive at some point. it is being delivered on big volume. i think we will probably wait until the beginning of next year for we get an accurate gauge on what is happening. but the news this morning

relatively positive. certainly the news around the omicron variant looks good. we've got this new pill coming from pfizer. it is expensive, but at least can be delivered at home. i think that speaks to a better outcome may be in the new year for omicron. my question is, is delta still waiting in the wings? the doctors seem to be telling me that it will be. we are not done with delta quite yet either. kailey: we know delta is still a problem in the u.s., although omicron now makes up the vast majority of cases. we have to talk about the policy response when we talk about the virus, and the u.s. not heading towards lockdowns or really any kind of restrictions. damian: i wonder if this has anything to do with is in joe biden's weak ratings. what comes next for the democrats? what comes next for congress? we have to start looking ahead to the november midterms. it basically looks like it is going to be a republican house. kailey: we started this week was

a pretty ugly session. part of the question was what was going to happen with fiscal policy in the u.s. we still don't really have those answers, and yet it seems people have decided to look through that, at least for now. guy: next year looks really difficult, doesn't it? you are going to have a fed tightening. you still got high energy prices. you look back at history, certainly back to the 1970's, and history tells us recessions are caused by the fed tightening and/or high energy prices. can central banks, hen global central banks to deal with this inflationary narrative, tamped down inflation without causing a recession? i think that is one of the charges we will have to work airway through. growth is going to be good, but it is going to fade relatively quickly. let's talk about the markets. this christmas eve eve. we've got super light volume. it looks like we will get more traction on the upside when it comes to equities.

the euro is unchanged, but still north of 1.30%. i think the story is in the pound this morning. the pound propelling to a one-month high. we've got bond markets on offer a little bit, but not much. crude, we are bid a little bit, but i think the story is in european energy. gas prices coming down sharply, but still elevated is europe, facing the recession risk nest gear if we see energy prices remaining high through this winter into the summer and potentially into next winter as well. kailey: we will discuss that with our guests throughout the next couple of hours. when it comes to european natural gas, u.s. lng trying to take advantage of some of those prices. we are starting to see tankers heading out to western europe. you contract that on your bloomberg terminal. 8:30 a.m. eastern time, we start to get a pretty rapid series of economic data. we have initial jobless claims, durable goods, and that core pce

deflator, the fed's preferred inflation gauge. i think that is going to be particularly interesting as we talk about inflation. incomes adjusted for inflation aren't really keeping up, and at that point, would we start to have a conversation about that hitting spending? consumers have had savings to draw on. when those are all the way drawn down, what happens next? we will get a read on sentiment with u mich consumer sentiment at 10:00 eastern time. we saw a blowout with the conference board number yesterday. how much does this readthrough into this metric? closely watched are the inflation expo patients. finally, 2:00 p.m. eastern time, the bond market will close for trading. that means a shortened session for treasuries, although equity markets are going straight through until 4:00 p.m. eastern. guy: with, i suspect, volume peeling off as we work our way through. i think it is going to be interesting to see exact a what the inflation component is within that.

let's kick this all around. let's figure out where we are going. luke kawa, investment directions -- investment solutions director at ubs asset management, joins us now, of course, formerly of bloomberg news. i read your note this morning. pretty uniformly positive. where is the risk to that positivity? luke: i remember a bout a month ago, we were learning more about omicron and wondering, are we going to have to jettison our year ahead outlook? so far, some of the most positive news seems like we don't have to. where i would say the risks lie for the real economy, i think it is more a second-half story of we know a lot of demand right now in terms of new orders might be somewhat ephemeral, might be somewhat overstated based on the extent of supply chain pressures , so wondering if there's some kind of air pocket on the other side, but even before we get

there, there's a lot of replenishing of capex, of consumer spending. on the real economy, if you were worried on the markets, i would say the bigger risk is, as you have alluded to, more what happens when real rates start to rise. that will be a negative for multiples, a negative for valuations. this will definitely be offset by earnings growth that is going to be at least in excess of what we got during 2017, which i think was famously the year of synchronized global growth. we are expecting that even better coming in the year ahead. kailey: you also say that investors are underestimating that runway for economic growth, both in the equity market in the bond market. where is that mispricing the greatest? luke: i would say right now, the mispricing is probably the greatest in the bond market, but the bond market is going to require a lot more proof than the equity market.

the equity market i think we'll see these rotations to back in favor, and we have already kind of seen over the past month it changed back to value and back to more cyclically oriented sectors. europe and japan, and about the past 18 months or so. it has been all about pent-up demand. the next 12 months we think are going to be a lot about pent-up production and some of those supply chain stresses easing, and big places that have highly leveraged industrial economies and big current-account surpluses, lots of exports. europe and japan, as the auto situation gets better, they are going to be incredibly well-positioned to perform there. from the bond market, a bit of a different story. what i think we need to see going forward is to not only have central banks, not just the fed raise interest rates, but central banks in a relatively think rest fashion raise interest rates, the ecb start to move towards talking about

talking about rate hikes, and investors seeing that this is as if and to undermine the growth outlook. as guy was talking about earlier, the idea of high energy prices were monetary tightening causes recession. we don't see the amount of central bank tightening in the pipeline over the next year significantly curtailing demand. 2023 also looking like a good year for consumption based on how good 2022 will be, and our view. that is when reinvest -- that is when investors can start to reevaluate their view on how high the terminal rate will go. damian: kailey would like we do ask you how long it took to finish legend of zelda on saturday, but certainly i agree with you that china growth is slowing or get we have seen a pretty good correction in the equity market. is more in store for us? luke: one thing we have actually become more reengaged in is china relative to the rest of vm

because we do see that in terms of how valuations and multiples have corrected, particularly on a lot of the mecca cap tech names, it is asked the mecca cap -- the mega cap tech names, i do see scope for chinese assets in the near term to outperform their e.m. peers, which is something that does tend to happen, so you have a good bit of seasonality there. i think we do have to respect that as we talk about the growth outlook and how things are so different this cycle and better this cycle, one thing that is worse is the structure for chinese growth. that is simply not going to be as strong as it was in the past cycle. we believe that dm growth is going to more than offset this in the near term, but also want to point out that even on the structural, slowing chinese trend we are in, a lot of this in the near term has been

realized. chinese policy makers do seem to now be changing tacked and putting more of a floor or one the appearance of putting more of a floor under activity, in terms of some of the mustard around the property -- the messaging around the property market and the monetary policy tweaks. we would expect more wholesome recovery and mobility and consumption probably having to wait in till after the beijing olympics, but we do see stability in china. but on the whole, not a strong as it was last cycle. not going to be the global economic engine the way it was back then. kailey: luke kawa of ubs, thank you so much for joining us. guy, i keep forgetting that the a olympics are coming up fairly quickly. guy: the beginning of next year. and chinese policy seems quite focused particularly around beijing on those games. i think it is going to be interesting to see what happens after the games in terms of industrial production in particular because they want blue sky for those games. they don't want any smog.

we will see whether or not there's a dip, and whether there is a pickup coming later. damian: i am curious to see if it can compared to last year. the chinese new year, all of that notwithstanding, it is deftly going to be weaker this year in my opinion. kailey: we also have to consider covid-19 because you are starting to see china lock back down. she on -- xi'an, 13 million people back under lockdown. that news we got out overnight. we will continue to monitor the situation in china with the virus and continue to monitor these markets. up about 0.3 percent on s&p 500 futures. 4700 is where we sit on equities. 1.47% on the 10 year. on tv and radio, this is bloomberg. ♪ ritika: with the first word news, i'm ritika gupta. the supreme court will hold a special session in just over two weeks to weigh challenges to

faxing requirements for millions of workers. the court will hear arguments in the cases january 7, amid rising coronavirus cases, and it is an expert nearly fast timeline. the court is not scheduled to hear cases again until january 10. also officials say omicron could leave the population almost unprotected against covid infections. that is why they have hunted some people to offer forth -- offer fourth vaccine doses. the chinese city of xi'an has imposed a lockdown on its 13 million residents after testing identified 120 seven covid infections. residents have been told to stay in their homes and designate one person to go out every other day for necessities. it is china's biggest lockdown

since the beginning of the pandemic and will on -- in wuhan. intel's continuing access to the chinese market is crucial to its growth as it struggles with increasing competition. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. ♪

♪ pres. biden: i want to get as much as we can possibly get done , and i still think we will be

able to get a significant amount of what we need to get done done , particularly as the american people figure out what is in this legislation. it is extremely consequential. kailey: president joe biden trying to keep his optimism on the build but better plan. we likely won't get any further news on that until the new year, when the senate returns from the holiday break. these markets were spooked by the conversation around fiscal stimulus on monday, and following we have seen a rally. that looks like it will continue this morning on pretty light volume. s&p 500 futures up about zero point 3%. the 10 year yield up to basis points to 1.47%. we are getting a little bit of euro weakness coming through. a little bit of a lift for crude as well. let's get back to politics. , reordering, bloomberg ash annmarie hordern, bloomberg -- annmarie hordern, bloomberg washington correspondent, joins us now.

the administration has tried to put into place policy to make workers get vaccinated or have a test out option. now we understand the supreme court is going to take a look at that quite soon. annmarie: this was always going to head to the legal battles given the politics in america and whether or not the federal government can do this, especially when it comes to the private sector. if you run a business, the federal government is saying everyone needs to be vaccinated or get a test. now the supreme court is going to have a hearing about this. it is not so much about the actual idea of making sure businesses are doing it, but these up in court to be hearing the fact, is this part of a government that would be responsible for this, are they overreaching what they actually are allowed to do? so it is going to be very interesting to hear what the supreme court comes out with. this is one of the tools the federal government really wanted to harness, given the fact that already we have over 800,000

deaths from covid, and the fact that they are still struggling to get numbers down, especially in the wake of this new variant. guy: the president won't, but should we park build back better until early next year? annmarie: yes, of course. it is christmas and the new year. they did have this extraordinary meeting that senator manchin did attend, and i called this yesterday more of a first meeting for a family therapy session that any sort of breakthrough, but they will be taking it up in january, so until january, we can see what they come back with come up essentially a revised version of the president lynn mark legislation. -- the president's landmark legislation. guy: vladimir putin is very much focused on what is happening in ukraine at the moment. europeans are starting to get jittery. the european authorities have

been for quite some time. in terms of the way we should frame this from a u.s. perspective, what are you hearing? how concerned is the administration? what is the fear as we go into new year, maybe as we go into spring, and the weather starts to improve, round vladimir putin's intentions? is it all bluster, or is this actually a real threat? because europe maybe needs to get a little more worried if that is the case. annmarie: they just don't know yet. this is the entire game that president putin likes to play. he likes to keep his advertorial -- his adversaries on their toes. the u.s. and adminstration does not know if this buildup we are seeing in the artillery being built up alongside the ukraine-russia border, whether that is just putin trying to play politics, negotiating tactics, or whether or not he wants to make another player ukraine, similar to 2014, when he went in and annexed crimea.

that is the question. at the same time, the u.s. administration is going to take it very seriously. what we do know is that in january, there's going to be a security dialogue between the united states and russia, and likely as well some other nato members in europe. you heard it today, president vladimir putin is certainly not backing down until he gets that dialogue. there's a number of issues he certainly wants to be discussed that the u.s. think should not be, in terms of like the 1997 line and whether or not soviet states, nato should be involved in all not. this is all something we have to watch every day until potential he those geneva talks. damian: president putin is playing chess, and also playing checkers, i guess. what sort of concessions with the u.s. have to make to get putin to back off the ukraine? annmarie: it is a great question. we don't know exactly all of the

details. we do know that what russia certainly wants is that ukraine could never be part of nato. nato is not going to bar any nation in black-and-white that they cannot be part of the group. but potentially there will be some security lines that could potentially be drawn, given the fact that you do have this mass russia buildup. last time we had a russian buildup was the spring, and that really started to quell and dissolve when president biden picked up the phone and offered president putin that summit, which they did in fact have. this time the buildup is not stopping even though the two have gotten on the phone. kailey: annmarie hordern in washington, thank you so much. when we talk about geopolitics and russia, we also have to consider the political factors at play in the natural gas story in your neck of the woods in europe. russia is not going to fill the void. is there a strategic opportunity for the u.s. to do so? guy: the problem with the u.s.

providing some gas to europe, and clearly you can see ships on bloomberg maps heading out of the u.s. and into europe. prices are high here. so we are going to see some. but there's not enough liquefaction capacity in the united states to do what is needed to be done. there is some. there is more being built. but it is not there yet. so at the moment, europe still relies as the swing producer in terms of where we get our gas from from russia, and the then diagram, politics, geopolitics, gas all overlapping really quite severely at the moment. you wonder whether this is the underpriced risk for europe. recessions are caused by central banks tighten policy generally, and/or high-energy prices. europe has got super high energy prices right now. damian: i just have to go back to what ian bremmer said on "balance of power" yesterday.

he said this might not be an incursion into ukraine by russia. this might result in a formal annexation, something like we saw in previous instances. the accused the ukraine -- if they accused the ukraine of genocide against the russians, what would the u.s. be able to do to prevent it? your guess is as good as mine. guy: you look at what is happening, the administration in washington come up you look at berlin, what's happening in paris, highly unlikely certainly seems to be the story i get back when i talk to people about this. but the other threat that putin doesn't talk about is if ukraine prospers and is a democratic country, he has always made the point that former soviet satellite states can't exist in the same democratic framework that the west existed. if ukraine can prove that works,

that is a threat to vladimir putin's rule in russia. we will talk about that certainly a little later in the program. kailey: james foley, head of fx strategy at rabobank, is going to join us. we are up 0.3% on s&p. this is bloomberg. ♪

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kailey: on tv and radio, welcome to "bloomberg surveillance." it is the last day of trading in the u.s. before the christmas holiday, so volume is light, but traders are bidding equities higher. sb futures are up by about 0.3%, right under the 4700 level. the euro is weaker against the dollar by about 0.2%. on dollar $.13 is the handle we are looking at. the u.s. tenure at 1.47%. -- the u.s. 10 year is at 1.47%. guy, very poignant conversation you had with the novavax ceo earlier this week about when we would get efficacy data against the omicron variant for its vaccine. that stock is up about two point 3%.

analysts say it looks pretty good. guy: that was what we were hanging on for. stan erck didn't have that data at the point we had our conversation, so really key to see that coming through. this is a vaccine that is a more traditional vaccine rather than the messenger rna vaccines we have seen from moderna and pfizer. maybe this vaccine will encourage some people to go out and take the vaccine for the first time. maybe this will eat away at some of that vaccine hesitancy. certainly that is the hope. kailey: in order to get the boosters that provide the most protection, you have to get the initial shots first. novavax is in positive territory, as are some other stocks across the tribal complex -- across the tribal complex. norwegian cruise lines is up a little more than 2%. i have to make mention of tesla because elon musk is selling even more shares, the equivalent of $930 million. he's almost done with offloading

that 10% stake that twitter told him he should do concert tesla is up about 0.9% at this point. guy: i think we all feel like we are almost done. [laughter] kailey: so close. guy: let's talk about what is happening in the fx story. you mentioned the euro getting a little weaker this morning. of course, we've got a strong pound this morning against the dollar. this as it looks like we are potentially in the process of maybe just, and i imagine here, avoiding a lockdown -- and i am hedging here, avoiding a lockdown in the u.k. jane foley joining us now, head of fx strategy at rabobank. as we come out of 2021 into 2022, does this incredible tailwind we have seen from the dollar this year continue into next year? jane: i think it can continue

into the initial few months and maybe wait until the fed gets going with interest rate hiking that cycle. we've got your number -- we've got to remember there's an awful lot of good news priced into the markets. since that trend really did get underway in june, june was where the prospect of an interest rate hike in 2022 was initially put on the table. since then, the market has become more and more optimistic about the possibility of interest rate hiking, so there is a lot of good news. that is why we are sort of glued to that $1.13 handle in euro-dollar right now. i think we need this consolidation to get perhaps we need to pull back before the market can really make a decision about do we want to build on those long dollar positions, or what on earth could happen to do that. i think we can have further to go. i am not so sure if the movement up in the dollar can last the full year, though.

guy: do we understand the risks around european growth at this stage? one of the things that has flown under the radar as we have watched things that have happened with the fed, what has been happening with the fiscal programs in the united states, and omicron has been this gas price in europe. they are coming down a little bit as we see the arrival of some lng tankers from the united states, but they remain very high. we've got very little storage. we could potential he be in the same situation next year. could this be a growth threat for europe, where we are underestimating the impact this could have? jane: in many respects it really does not endorse the very cautious stance of the ecb. she is continuing to remain dovish, continuing with very supportive monetary policies. i thing this is one reason why she is justified in doing this.

we have already heard reports of small businesses, bigger businesses have a good shutter because of the additional cost that these energy prices bring, but also it is going to be a significant headwind to consumers. i think that risk is only going to be highlighted during the winter months. some countries have taken some action to reduce the bills for consumers. that will help, but this is certainly a significant headwind for business and consumers in the region. damian: i had a lovely chat with your colleague christian lawrence yesterday, and one area of disconnect was china, an area he tends to avoid at all costs. what are your views on the renminbi in 2022? jane: if you look at the chinese economy, we know it is slowing. it is fairly normal to see a currency weaken.

i think one of the constraints for china in terms of the exchange rate was the very strong ppi inflation numbers we were getting out, but they have appeared to start to moderate. if we do get some indication that inflationary pressures are moderating in china, i think at that point the authorities could be more comfortable in allowing the exchange rate for the chinese renminbi to weaken. so i think we are probably going to see talk of interest rate cuts if we don't see more interest rate cuts in the next few months, and that could be associated with more expectation that they would allow the renminbi to slip against the u.s. dollar. damian: one area devoid of surprise is turkey. the euro is now back through a lot -- the libra -- the lira is now back through 11. what are your thoughts on the lira come the new year? jane: there was a report making

cooking lesions about the level of foreign exchange reserves, and their calculus was that these had dropped by billions in a couple of days at the start of this week. the implication was that we had the speech from president erdogan in the course of the week. we had this backdoor interest rate hike, retail investors that were concerned, and the implication was that they made it intervention to really exaggerate the move because of the christmas period. the take away from that is that the intervention was done at a time which could make everyone look good, and that take away really does undermine the credibility of the turkish authorities even further. i think that unless we get an interest rate hike, the majority of investors will continue to sink in the turkish lira remains vulnerable.

guy: vladimir putin this morning, and his press conference, talking about turkey , talking about the impact policy is having, saying he doesn't want to repeat it in russia, talking about the need for rate hikes. that largely seems priced at the moment. but the real threat it strikes me for the ruble his geopolitical and what is happening around sanctions, what is happening on the ukrainian border. what is currently priced there, and terms of that geopolitical risk? jane: there's a lot of interesting topics you just brought up. the credibility of the russian central bank cannot in any way be compared to turkey. the russian central bank has a huge amount of credibility, so that is one thing. the other thing i think that is worth pointing out with respect to the russian ruble is that although we are talking so much

in the west about ukraine, was the geopolitical risks come about the tensions between russia and the u.s. or russia and nato, russia and europe, if we look at the ruble, it does seem to be more driven by the oil price. from that point of view, we haven't had a more geopolitical impact yet get clearly if we were to have an increase in tensions over ukraine, that might change. but that is not a driving factor. kailey: jane foley of rabobank, always great to get your insight. thank you so much for joining us. happy holidays to you and yours. i have to say, i am so glad damian decided to go with em in that conversation. the last time we talked to an fx guest, he came in on the dollar. what is that? damian: the dollar is what drives e.m. but let's talk about the dollar that rallies and pretty much all environments. that's typically not a good

thing in emerging markets. your guess is as good as mine where the dollar is heading next. my bet is that it is true bullish -- it is structurally bullish and it is a battle we will have to fight in the next year. kailey: the question is, once we get to the end of the taper and we start the hiking cycle, what happens to the trajectory of the dollar after that? guy: a lot will depend on what happens in europe. certainly that is going to be a huge factor. i think it is a sign that everybody needs to consider. i keep coming back to this. the equity market performers this year, you can bring it up and figure out what the currency adjustment story looks like. it is absolutely massive in terms of the impact it has had. euro stoxx 50 this year, if you are a dollar investor, if you

invested in europe this year is a dollar investor, you have made 10.63% in the euro stoxx 50. you have made nearly 20% if you are your invested. the fx story has had a massive impact on transit limit trade in terms of equities this year. kailey: guy johnson just proved the power of the bloomberg terminal. shameless plug. coming up, i am looking at the bloomberg terminal, which is showing futures in positive territory, about 0.3% higher. we are sitting at the 4700 level. we are not that far from record highs as we approach the christmas holiday in the u.s. we are going to break down economic data at 8:30 was matthews lose eddie -- with mettler cedi -- with matthew luzetti. this is bloomberg. ritika: former treasury secretary lawrence summers's warning of a testing pope over the u.s. economy in coming

years. with the risk of recession followed by stagnation. in an interview with bloomberg economics, summers says the federal reserve has been late on inflation and that delayed action could potentially tip the economy into a slump. a third dose of astrazeneca vaccine significant boosted neutralizing antibodies against omicron, according to studies of the university of oxford. two doses and a booster of the covid-19 vaccine made by china's sinovac did not produce significant levels of neutralizing antibodies to protect against the omicron variant, according to a new study of one of the world's most widely used coronavirus vaccines. more than 2.3 million doses of the vaccine have shipped out, mostly in china and the developing world.

a stake in jd.com worth more than $13 billion comes from beijing's punishing tech giants for anticompetitive behavior. it may by goodwill with the government. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. ♪

>> i think there is a reasonable likelihood that the russians will engage in some form of escalation.

they are going to be very tough sovereign debt sanctions, primary and secondary, nord stream 2 won't happen. but what if they don't ukraine? what if they formally annexed the territory they already have? kailey: that was eurasia group president ian bremmer on the rising tensions. we heard from russian president vladimir putin earlier today talking about the order and what he called nato getting a lot closer maybe then he would like. damian: he makes an excellent point, and one that we have flagged as well. when it comes to russia, look no further than ian bremmer. he was the guy to call the default. they did it willingly. so russia is kind of a slippery slope, but i absolutely see them going to annexation here. guy: it kind of makes sense from a technical point of view. from a strategic point of view, you create a buffer. if this is what putin is worried

about, you and i that region. it is not a big buffer, but it creates a buffer. it allows you to control the narrative a little bit more. but nevertheless, i come back to this idea that the threat ukraine poses is that if ukraine is successful as a democracy, that undermines what putin is doing in russia. that is a challenge the west has got to figure out. how do you keep these two balanced? if ukraine is successful as a democratic country, that is a huge feather in the cap of the west, but it is going to up the ante when it comes to vladimir putin. he is going to be tested by that in a way that i think he probably isn't going to be tested on the military battlefield because it basically undermines him at home. elections are always coming. i know they are a novel concept in russia, but i think if he's going to be put under pressure, ukraine could be part of that narrative. damian: ukraine cds spreads are

really widening off the back of this. you look at the former satellite soviet states, lithuania comes to mind, the baltic region, this is nothing new. the one country i think that is a pivot point for boudin is going to be belarus. we have seen what's happened there. these are real risks. russia is flexing its muscles. kailey: one we are talking belarus, russia, we ought to talk about nord stream 2 and the flow of energy to europe. it is something that makes this whole situation more politically tenuous, especially for the u.s. as european allies. i want to also bring our attention to a situation unfolding in baytown, texas. we should have live pictures freight have led -- pictures for a television audience. firefighters are working to extend wish at an exxon facility a fire that broke out at the u.s. four people have been injured in

that fire. it started around 1:00 a.m. local time. they have been working on extinguishing it. you were seeing a lift a little bit and gasoline futures. guy: the refinery, that seems like a logical progression to rock about when it is going to show up. the stockpiles have started to come down in the united six. if you look at the inventory data, demand is expected to continue to pick up. you do wonder whether opec is really going to be able to control this narrative. you do wonder ultimately whether the story is that shale comes back. it is trying to be disciplined now, but the shale comes back next year. kailey: oil is around the highest in a month. we are looking at a $73 handle

on wti crude. let's get to kriti gupta with our chart of the day. volume is pretty light. kriti: that is what my chart of the day shows, what we can expect when it comes to the equity market next week. everyone really just tapped out and starts to celebrate the holidays and not really focus on their portfolio, with the exception being the dramatic event in december 2018. the question is, do we see a repeat of that next year? i am here to show you, essentially it is a five day moving average of the equity market volume you have seen in the last 10 years. essentially, all you need to know is when the end of the year rolls around, you start to see a massive dip in volume. let's talk about what that means for the s&p 500 market returns. the last 10 years, the average return has been about 10% in this last week's. we have to talk about the kutty,

how big the market moves are for each dollar traded. right now liquidity is higher than it was even in october, so the question is is that continues drop next week, and if it does, does that mean any moves that might hit the stock market, do they look exaggerated ? guy: when you have a situation with low volume and you see big moves, certainly you want to be thinking about that. what does this tell us about what january is going to deliver? is there any correlation between late december and early january? kriti: seasonality has everything to do with it. a lot of this is going to come on the back of a very strong 20 to anyone. so if we are going by the historical trend, january could be a little bit rocky, especially in those first couple of weeks as you start to see traders and investors return to the desk and reallocate those portfolios. kailey: congress will be

returning, and i am sure this market will be paying very close attention to the ongoing discussions around the build back better plan. thank you to kriti gupta for our chart of the day. you can find that on twitter. something that was brought up to me in the break by damian sassower, it is the absence of tom keene and jonathan ferro, we have not talked about european for ball. i will leave that to you too. damian: let's talk about the tots, 2-1 over west ham yesterday. that is not nothing. where did nathan go? guy: i don't know is the honest answer to that question, but you think about what is happening in the wider world coming to be you can draw a conclusion on that. a lot of games are getting camp right now. boxing day is a football day here in the u.k. a number of games have already been canceled. there's talks are being games played behind closed doors which is a huge blow for the fan. -- for the fans.

that is hopefully again that will go ahead. i do wonder whether some of the london games could be at some risk. kailey: this is also an issue in american football. use high number of nfl games delayed. we played football on a tuesday in the u.s., which literally never happens because you see a number of key players testing positive with covid-19. when the broncos had no quarterbacks due to covid 19 protocol and had to play a wide receiver from the practice squad, that game wasn't delayed for us. i'm a broncos fan. i have some grievances. that is all i will say about that. we're looking at a positive session when it comes to s&p 500 futures, up about 0.3% at this time. we are hovering around the 4700 level. we are not far from record highs as we get close to the end of the year. santa claus has come to this market.

volume is light. we've got to keep that in mind. the 10 year yield is sitting at 1.4738%. we will continue our comfort station -- our conversation with sam stovall, chief strategist at cfra. this is bloomberg. ♪ ♪

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>> this cycle easily carries into the middle of this decade. >> i think we are late cycle at this juncture in the market. >> it has to be profitable growth. >> risks are definitely going to be the did -- going to be to the downside. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. kailey: good morning on tv and radio. this is "bloomberg surveillance ." kailey leinz, damian sassower, and guy johnson in for tom keene my jonathan ferro, and lisa abramowicz