>> stocks in the red. bloomberg markets starts right now. we do have read on the screen. this is not how we opened earlier. the stock get down on the s&p 500. the nasdaq underperforming. a battle between your tech stories. we will dive into it. check out the bond market. intraday volatility you want to keep an eye on. 10-year down. i want to follow up with the dollar because as we start to see tiny moves in the bond market preparing itself the

deflator number tomorrow, the dollar kind of sharing the same sentiment, only stronger by about .10%. looking at nymex crude. how much of it will snap back if it is following with the equity market in terms of sentiment? earlier, an exclusive interview with bloomberg morning stocks could be vulnerable to a macro shock. >> we saw the market repriced to cheaper and the differential between very expensive and very cheap stocks come in fairly dramatically distill an extremely high differential. that is the part you have to keep in your head. yes, i do believe this will continue. i just feel stronger about diversifying and making sure you have exposure to this. there is always a chance the trend reverses for three months before he continues again and

people pay net. almost every correction we have seen of dislocations have had massive rallies back toward crazy within them. i have learned to be scared of that but i will go out and say you want this now. >> diversify and hop in the market seems to be the message. joining us for more insight is seen uber of invesco. -- kristina hooper of invesco. now is the time to hop in? >> it is critical that investors be well diversified. there is never a perfect time to hop in until we look in the review mirror. i would not say throw everything into equities, but it is important to have adequate's poster to equities but be broadly diversified within. that means exposure to the international space, especially emerging markets. he will diversified within fixed income. a lot of great opportunities after the pain we went through

last your with a tightening cycle and also round out that diversified portfolio. >> speaking of that cycle, we are looking at a peak policy rate for july priced -- priced at 5.5%. it is interesting jamie dimon referenced it. talk about how this factors into the equity market. is it christ to perfection -- is it priced to perfection? >> i don't think it is. what we are seeing is a moving target. every day that market is assessing all the risks. the risk of fed over tightening and the impact on u.s. economy as well as just where the terminal rate is going to be. we have a lot of factors at play. some days that makes stops look attractive -- stocks look

attractive and sunday's unattractive. what we know is this is a period in which equities are reassessing recession risks likely are going to positively reprice recession risks from the data we have seen unless the fed really does a surprise and get a lot tighter. that means the stock market, even if we see some retracing in the next few months, is likely on a road to a sustainable recovery. >> speaking of recovery, it feels like the story of recession has kind of input to the side. it felt like it fueled a lot of the tech trade until you get to today where it feels like in preparation for that pce deflator numbers, selling tech seems to be that trade of the day. what do you do with some of these big tech names? >> it depends on your time horizon. if it is three months, and that is not a very good period of time to be holding some of these big tech names, but if like most people you have a longer time

horizon, should be comfortable and perhaps look for buying opportunities in the next few months as we do likely see some pressure coming on from the expectation of rising rates and certainly concerns that inflation is going to be higher than expected, that it is more persistent, that many had hoped. >> that's narrow this down. let's go to the next three months. that will take us to april or may. if we are starting to price in a few more hikes, sector by sector, what is the defense of trade and that you're looking at potentially 4% yield on the tenure? what sector do you go to? >> it is very much not sector-specific. what we're going to see is the quality trade perform well. i think some cyclicals will start to perform well as a discount out 6, 9, 12 months and

economic recovery that is likely in the offing after we do have some kind of a landing. i think we want to focus on quality. look for some defensive areas like the areas of technology that have significant secular growth that are not going -- that are not as highly valued so they won't be as vulnerable to rate increases. in general, this is going to be a more idiosyncratic environment as we have seen from the earnings reports thus far. >> you mentioned defensive and tech. i feel like would you put this together, biotech comes to the forefront. what do you do with health care? >> that is an exciting area, especially biotech most of certainly we are seeing more investment in the space, a recognition there can be some significant returns. i do think there should be some patience.

it is likely to be a fairly defensive space and hold up fairly well. >> something we will keep our eye on. kristina hooper of invesco, we want to thank you. moderna be one of the movers we have been watching, tumbling in the session. came out with earnings this morning and the stock sitting at the lowest level since october. they fell well short of analyst estimates. it does not take into account some of the other drugs they're working on. joining us to talk about it, kailey leinz. walk us through the story. >> there are two parts. one is the forecast and the other is earnings missed by pretty wide margin. analysts were looking for 4.67. the sell side is pointing at higher costs. on the subject of forecast, the sales view for the covid-19 vaccine, they held it steady at $5 million.

the street was looking for more like $8 billion. they did say there is the possibility were orders will come from markets like japan and europe and the u.s., but the fact the number has not change would suggest things are slowing down and this speaks to the covid future is very much an a question. covid is still around. i think we all know people who have had even any recent weeks, but deaths and hospitalizations are lower, therefore, vaccines seem to be waiting. the biden administration is going to abandon control of it, turn it over to private companies and insurers to figure it out going forward. we understand moderna is looking at pricing between $110-100 $30 for these vaccines once we get a privatization. but that is a giant question mark hanging over the story. >> and demand your saying across

the vaccine makers giving the boost you're talking about. let's talk about their diversification strategy. their cancer vaccine also in the headlines. >> it is about focusing on a diverse pipeline in a post-covid world. they are trying to use that existing mrna technology in other ways including that cancer vaccine. it is accommodation with immunotherapy in trials. in december a shows it does reduce the fatality rate of melanoma. as a result, the company said yesterday they have got some recognition from the fda with a breakthrough therapy designation, essentially, and acceleration. it is designed to expedite drugs that look promising and serious conditions when preliminary clinical evidence is suggesting it will have a promising future. that is essentially what happened with the december data. the company say going forward they will do a final stage trial from an dilemma -- for melanoma

in 2023 and expand that as well. it will be key for this stock going forward. if your main business, customer is going by the wayside, it is going to be about that pipeline. >> diversification. kailey leinz breaking it down. we thank you. let's go to john highland. >> keeping close tabs under their weapons after president vladimir putin suspended his country's participation in the new start treaty. secretary-general spoke of the risk of an arms buildup. >> this is a reckless decision because we need arms control. we need transparency. so we call on russia to reconsider and to respect and to fully implement the new start agreement, including the inspection regime which is

extremely important. then we will mostly monitor what they do. >> the nato cheap reiterated concerns china was considering providing russia with military aid, when "this would be a big and serious stake." at least six are dead and more than 40 missing after a coal mine in northern china collapsed. chinese state news reported police are investigating the cause of disaster and have detained potential suspects. it could end up being the deadliest mining accident in china in years. the national transportation safety board is out with a report on the ferry train crash in ohio that says a wheel bearing appeared to overheat before the derailment and sensors failed to detect it. toxic chemicals were released into the air. here in new york city, new criminal charges have been unsealed against sam bankman-fried accused of fraud last year. the accounts include commodities and securities fraud. it is unclear when he will return to manhattan for arraignment.

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>> this is bloomberg markets. we talked about global central banks raising these rates, fighting inflation. a lot of it driven by

commodities and food. hostess brands offers a little bit of a window when it comes to food, wages, prices. its stock has been surging this week. eight out of 11 say it is a buy. with this is the president and ceo andy callahan. we talked about inflation. how is that feeding into your pricing strategy? >> first of all, great to be here. it has been a great week for us. we wrapped up 2022 with our third consecutive year of double-digit revenue growth and 9% ebita most update a guidance of another year of growth in a double-digit profit. we can get into all that, but related to inflation, nearly 20% total inflation for the year, some quarters had 20% or above.

we have to pass some of that on to consumers and certainly that played into our year. we were aggressive about that because we are funding our innovation come our marketing that is really driving our growth, but we are sensitive to that. we partnered with our customers and were already sensitive to consumer value that we deliver. we do it as a last resort. we look at productivity and other efficiency initiatives to offset that is much as we can. we are still able to grow through that because we are really at an accessible price point and consumers are looking for high-quality and snacks. we have enabled a bounce that well. >> of feel like looking at the raw ingredients that go in your products, those prices have not been coming down as traumatically. what does that mean for your margins specifically? are you worried about margin compression? >> we balance margins but once again it all starts with the consumer -- sustainable growth.

we did absorb some margin compression. we are taking the long view. it has to happen through a process of balancing our value opposition, our consumers. and our ability to recover over time, which is not just pricing. we believe we have all the pricing and into marketplace we need despite another year of high single digit inflation growth as you outline. we're going to work to continue to keep the growth value, the consumer partnership as we work to offset that margin over time. kriti: let's stick with our margin subject. it is also about labor. that is proven sticky in this environment. 2800 employees at hostess brands. talk about their salaries. are you seeing more pushes for higher salaries? >> we are-focused. it is salaries but also the

total employment proposition. we work to improve their benefits, we partnership with national alliance for mental illness, we have improved their 401(k), we have shared bonuses. we give that back even to our hourly employees in the form of bonuses. we recently moved -- we don't have a large percentage of our workforce but within those we partner with them and give them wages that went flawlessly as we continue to invest it. our wage strategy is to make sure we have the right proposition for our employees including our hourly wage which is at or better than the minimums in every marketplace and well above the national average. kriti: 700 $50 coming as part of that bonus package for a lot of your employees. it is interested you mentioned the non-salaried approach, the mental health piece of the equation as well. talk a little about the growth plan. much of your business, if not

99% come is in the u.s. are you planning to expand internationally? >> we believe organically, with so much growth in the u.s. right now, we focus on our ability to do that and the short term. first of all, we compete and are broader $65 billion snacking segment. snacking has grown greater than food. indulgent has grown 20% faster than not indulgent snacking. we have two leading brands, hostess -- and a better for you cookie that are both well positioned to access that growth. that is what we focus on. we really have a playbook that seems to be working as you look at our past results. we think we're just getting started without long run wave growth. our ability to do that, we are well-positioned to do that. we innovate. we are innovators. we have driven 44% of the

innovation in our category over the last year, which is over double our fair share index. we are talking to consumers, attracting new millennials, keeping with our investment quality. we just launched cast bars off the heels of another launch. we are focusing on the domestic market and there's a lot of opportunity. kriti: good to hear, andy callahan. always a pleasure to have you on the show. stick with us. still ahead an economy in crisis. nigerians head to the polls. why the presidential election could be a game changer not just for africa's biggest economy but america's biggest corporate players. this is "bloomberg." ♪ seems high. seriously? it's just a bike. wait. they make a treadmill with an intuitive speed knob? yeah. want to try? 92% stick with it, so can you. start a 30-day home trial today. terms apply.

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kriti: some of the biggest

companies in the world are i nigeria so next big growth market. the presidential election could be a game changer for unilever, coca-cola, etc. jennifer, always a pleasure to have you on the show. walk us through wife an american equity investor should care about what is happening. >> outside of the fact is this africa's biggest economy, you take a look at the workforce that is here and what we have seen the past few years, what a lot of experts have told us is under this current administration, outgoing administration, there is not been as much business-friendly practices. that has resulted in foreign investment dropping to new lows in 2022 what investors in the international community and what young people on the streets were speaking to us were looking to see is a candidate who can come

in and enact policies that will support economic growth. what that looks like depends on who you speak to. this country has one of the highest unemployment figures. young people are making up a number of people are not educated, not in school. brain drain is something we are seeing happening across the country, leaving to go abroad. this is projected to be the third most populous nation by 2050 behind china and india. so when we think about the growth potential come the economic potential for this region, for the continent as a whole, and really for international communities and corporate like those that you mentioned, nigeria is intra-goal. having an economy on track is really crucial. that is why a lot of investors are going to be paying attention to who exactly is going to be the next president and whether or not they're going to be able to actually get the economy back

on track, especially considering the turmoil it is currently in right now. kriti: in the last minute we have, you mentioned the population story, third most populous country when it comes to growth markets. is that the only piece of the equation? how does a multinational corporate look at the fact the currency as at an all-time low, the oil prices you've seen benefit a lot of companies in europe -- countries, excuse me, in europe don't necessarily benefit nigeria. how do you square the two? >> oil exports in particular makeup 90% of exports for this country. when we think about moving forward, any sort of growth potential for this country, it will require some economic diversification. we are looking to see which candidate is going to be able to bring some diversity into what it is that this country is doing, but as you noted, oil is still so integral to this

economy so dealing with the slumping oil production that we have seen is key. that looks like dealing with a lot of the oil we have seen but also figuring out what to do with the subsidies that have taken up a number -- much of the revenue the government is even making from production. we're hoping to also see this country start to refine its own oil, so to be able to profit from that. not just sticking with oil, but other means of output and really sort of utilizing this economy and this workforce that is so crucial to west africa and to the continent as a whole, especially consider this being a key point for the supply of goods across the continent. kriti: something we will be watching, especially talking about refining. simply the idea the big oil companies could all be looking to nigeria for those prospects. you can read more about nigeria today's bloomberg big take on the terminal and our website. markets are still in the red.

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>> welcome to the bnn bloomberg and bloomberg audiences. i am john hyland. spain may boost tanks they sent to ukraine from six to 10 according to the spanish premise or, or santas, -- pedro sanchez, who is visiting kyiv. a divided government may be back in washington but that doesn't mean there aren't issues where lawmakers can find common ground this year. several bipartisan ideas are getting early attention including legal protections for loans to legalize marijuana businesses, a $35 per month cap on insulin. boeing plans to end production of the fighter jet that -- audiences. the company will quit making the teen super hornet in late 2025 after it hands over the last one to the u.s. navy. more than 2000 of the jets have been built over 40 years.

the f-18 has been eclipsed by lockheed martin's f-35. 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 am john hyland and this is bloomberg. >> welcome to uber markets. kriti: and i'm kriti gupta. there is green on the screen that has turned around all the gains. when you look at the equity market. the s&p 500 down .3%. a lot of it driven by tech versus tech. your oracle is on one hand and your microsoft, apple, tesla on the other, we are going to drive into that divergence in just a little bit. 389 on the 10 year yield, lower by two basis points. a lot of positioning ahead of

that pc deflator number tomorrow. it feels like a lot risk-off cross-asset ahead of that data point that as we see that kind of small marginal moves, marginal volatility in the bond market, the dollar follows. nothing to write home about yet. nymex crude, we have to check out our commodities. the 75 handle higher by just shy of 2%, john. john: we look to a lot of these companies for signs of what is happening within the economy and you do see some of these stock reactions reflecting some of those cautious comments. ebay with weaker guidance. those shares are off about 6% right now. dominoes down within 12%. same concerns. netflix cutting prices by 50% in more than 100 countries. obviously, the global nature of that business being reflected in that decision from the

subscription company. he mentioned nvidia. it is up 13% right now but again, here is a company that is able to ride that ai wave and not every player is able to do that right now. kriti: it's interesting, the macro versus the micro. they discussed the fed's path forward. take a listen. >> everything about what the said is doing to tighten policy is going to be longer for longer. more rate hikes, a higher terminal rate. >> it is hard to fight that mantra of hawkishness. persistence finally, the market is listening. >> the markets have had to come to terms with the fed -- at this time around, strong sentiment that they will need to stay higher for longer. >> digesting the higher for longer risks from the federal reserve.

>> they may be keeping rates higher for longer. >> not enough yet. jon: let's bring in mike mckee for a deeper dive. just looking at an equity market, softer for a fifth day here. a lot of the voices pointing to getting our heads around the most aggressive tightening campaign by the u.s. federal reserve essentially in a generation here. >> the markets are coming towards the fed. the date are pushing them in that direction. longer for longer because what we got now is a much longer period of time in which we are going to be talking about how high does the fed go? i don't think they know. that is the problem. they are looking for some movement in the labor market and they are not getting it. we saw jobless claims, 190 4000, lower than anticipated during the week that we just passed.

and we are wondering what is happening. we know that there are some technical factors. if you are getting severance, you are not going to be eligible probably for jobless claims and that may go away and we may see things change. we are not see much of a crack in the labor market so the fed is worrying about that and in the minutes, inflation is job one. >> when we look at the data, there was a jobless claims data and a little bit more worry or reaction to the gdp revision and the personal spending numbers. >> what happened is the government applied the seasonal adjustment factors.

it did change significantly in a way that you usually don't see in a revision to gdp. the moves are not that big. it does look like we had faster inflation and you have to live with what you got. the issue is what is the trend going to be? we are going to get tomorrow some new pce inflation numbers for the month of january that will give us a better picture of where that is. kriti: michael mckee, our correspondent, always a pleasure. let's continue the conversation, picking up where mike left off. he joins me right here on set. the pce deflator numbers we are getting tomorrow, what can we expect? how big of a deal is this in terms of what the fed is going to do next? >> it's very important. basically sending the message, defeating inflation is job one. it is the precondition for anything else.

this fed has been more resolute than any fed in a long time in dealing with the inflation problem that they were responsible for leading out of the bag. and so, the inflation data are important. in a discussion panel that is unbanked call, the title is taming inflation. based on new york fed research. in the actual inflation numbers with this revision today is probably around 4.5%. whatever measure you use from 2%, i think the market makes the mistake of seeing a peak in inflation. we are going back to the old regime. we are not going back to the old regime and its going to come at a cost. it's going to come at a cost of higher interest rates. ultimately, it will come at a

cost in profit margins and i think that is what the stock market is beginning to grapple with. jon: we have definitely seen that was some of the outlook from companies reporting results today. to your point. if you have to map out your current expectations of how many additional rate hikes we see from here and at what point the fed decides that maybe they need to take a pause after that more aggressive action, what are your own expectations? john: our expectations have not changed for quite a while. which was a peak rate of 5.25% to 5.5%. that's the range. the market has now moved to price that. market has moved quite a way to price that in. and then for the fed to net rates sit there and substitute time for an additional rate hikes so what is the fed strategy? they broke interest rate incisions down to three components of how fast -- last year was how fast.

they dialed that down to a quarter-point. how high? well, officials about 5% and i think the market is pricing incorrectly probably another move beyond that. i think the fed is going to sit. they will get sufficiently restrictive. they are moving towards it and stay there. for a period of time. particularly when you look at the real interest rate, real yield at around 1.5% and i left the office. that is really signaling by the standards not of the 1970's but certainly by the standards of the last 20 years relatively high real interest rates. the markets move into this view that the fed will keep policy restrictive for a long time so they will have to defeat inflation. kriti: which brings us to the peak policy rate. we are looking at 5.5% inching closer to 5.6%.

jamie dimon, a ceo of jp morgan, talked about 6% not as base case but potentially 6%. is there a scenario where we get there? john: very easily a scenario where we get to 6%. that is if inflation doesn't continue to move lower. the fed -- i think the economy is likely headed towards recession. that's not because of how tight the fed is now. it's because of how easy the fed was when it let inflation out and invariably, defeating inflation problems, we have not had for a long time in the recession so if inflation is resistant to an interest rate of 5.25% to 5.5%, the fed will do more. they are going to see how long it takes and the good news is compared to where we were a year ago, when we had zero rates, compared to now, the fed funds rate of 4.75%.

we are much, much closer to that. the surprises for the markets on the right side are not going to be that great. kriti: sounds like you are dismissing the no landing scenario altogether. john: one can never dismiss. we have to be humble and recognize the state of our knowledge. cannot completely dismiss the no landing scenario but i do think it has become fanciful when we can get an inflation problem with the magnitude we have had back to price stability. without going through a recession. i think that is a fanciful thing. there was peace and news in the gdp report today, particularly wage and salary income was revised substantially higher in the third and fourth quarters so consumers are in a stronger position than they were but i do think that if you look at the signals in the bond market, i used to -- i moved to the u.s. in 1989. i worked -- he developed the new york feds yield curve model for

predicting recessions which is the spread between three months and 10 years and that is heavily inverted. 10 year yields yielding a lot less in short-term risk and that has always correctly signaled the recession so if we don't have a recession, it's going to go against a signal that worked in every recession and every time we had it, we had the recession for the last 50 years. kriti: it is kind of terrifying. it is still anyone's call whether we hit a recession or not. thank you as always for your time and your insight. coming up, wayfarers talk tumbling in today's session, following 30%. it is its biggest slide ever. stick with us. this is bloomberg. ♪

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kriti: this is bloomberg markets. and kriti gupta. our stock of the hour, wayfair falling the most on record. it comes at the company reported a worse than expected loss and a 19% drop in active customers. joining us now is a person from bloomberg intelligence. always a pleasure to have you on the show. wayfair, a discount retailer when it comes to furniture and investment pieces. why is it losing so many active customers? >> it is more than the active customers. i would say they did lose some but it's the revenues. it is the revenues that are tracking down 10% despite easier comparisons from last year. that is the biggest concern here but if you look at the bigger picture and you think about where wayfair sits today, $12 billion in annual revenue, about 2% of the total, which is $800 billion today. it is small and there's plenty of opportunity to grow so i

would say, yes, there is negative news in the short-term but longer-term, there is a lot of opportunity for this company to grow and it is getting close to ebitda profitability this year so that is very encouraging. jon: you know, if we think about where that revenue growth comes from, what insight can you share on that? obviously, everybody had their own story about buying furniture during the pandemic which powered the business and certainly powered the stock which is nowhere near were -- where it was back then. how do they get people interested in buying some of their core products again? >> a lot of it comes from repeat customers more than 75% of their orders are from repeat customers and that goes to show you the stickiness of the business. can they acquire more customers? absolutely. the lion's share of their business is driven by current customers that continue to purchase wayfair so that is a good sign. the business is sticky. they do need to see consumers

spend more on the home tier. we all stocked up more for homes. we spent more on our homes, and now that budget has shifted, you are starting to go out more. you are just preferring to fling. but given the age of the housing market, given how much investment is still needed at least in the u.s., i think there is a long tail wind here for wayfair. in the short end, it's choppy. you're not sure where the macro is going to go. we don't know what consumer spending patterns will look like that that is really why you see the stock plunging this morning. it is the near-term outlook is very choppy and uncertain. kriti: 30 seconds. you mentioned the housing market. is wayfair essentially a bet on the housing bubble? a lot of people are waiting to pop, not just in the states but in canada as well. >> it does lean towards the home industry but it's about remodeling and refinishing. it is not buying that home which is where we think there is a bubble. jon: thank you very much for the

context on the story of wayfair. we will continue to attract that stock. kriti was mentioning what is happening with housing and we are watching that in canada as well. a new report noting canada's explosive population growth is causing rents to surge. we will talk to the president of a realty company, next. this is bloomberg. ♪

jon: this is bloomberg markets. i am jon erlichman with kriti gupta. our number represents the number of international migrants to canada over the past 12 months. by far the largest influx since the mid-1970's. that figure pushing canada's

annual population growth rate to an average of 2.3% over the past year, fastest since 1972. the population surge -- the official immigration number is actually undercounted. joining us with more perspective, the president of a realty company who keeps tabs on the canadian housing market. on the one hand, you have higher interest rates which keeps people interested in mental properties or prices go up but then there is the story of so many new canadians. walk us through this? >> absolutely and that is what we are seeing on the ground. the rental market is unbelievable and part of that was driven by people hitting pause on their home search but a lot of that more recently is this big boom in both immigration and nonpermanent residents. many of them tend to go to the rental market first. not everyone is rushing to buy a home. this is really pushing rents out. in toronto, rents are up 20% per

year and we are seeing similar across the country as well. kriti: connect the story for us when it comes to things like immigration policy with the construction market not just for the next few months but for the next few years. what does that look like? john: completely disconnected and i think more people and more economists are raising the red flags. you have the federal government really driving up population through immigration for nonpermanent residents without coordinating with the housing sector. depending on which reports you are reading, ontario, our biggest province, needs to build between 1.5 to 2.5 million homes over the next 10 years to keep up with this and this is, you know, three times the level we are actually building so this is the challenge and this is why we have been seeing both rapid growth not just in rents but in house prices over the next few years. jon: we spoke earlier this half-hour about the fact that interest rates went from basically zero to where they are right now.

when interest rates were as low as they were, there were a lot of concerns about the subject of housing affordability which any politicians in canada had made a priority, but given what has happened to both rates and obviously, we just highlighted the rental market, where is affordability today? john: it is significantly worse than what it was when rates were low and the reason is even though prices have declined in many markets across canada and around 20% in the toronto area, the fact is when you look at housing costs today, even though prices are lower with rates where they are, it's actually more extensive today than if you bought at the peak of the market so it's more expensive to actually buy a home and of course rents have surged so housing affordability is significantly worse today than what it was a year ago. kriti: put that into context for us when it comes to foreign buying. are you starting to see more people hopped into the canadian housing market or perhaps exit even faster even that the bubble has not quite popped yet?

john: the interesting thing is we haven't seen a lot of people exiting the market. this has actually been putting pressure on the housing market. typically in down markets, you expect to see investors exit the market quickly. they are usually the first one to list properties for sale and we have not seen that in the gta, in the toronto area, and that kept the ceiling on the number of listings and has made the housing market in toronto quite competitive even with sales at 20 year lows and that's because you listings are at 20 year lows and that the most interesting dynamic we are seeing in the resale market right now. jon: putting the pieces together, one of the things about the canadian economic roadmap, new canadians have been key to the growth story of the country. if the housing affordability is less so than when interest rates were at zero, how big a dialogue does this end up being for all the government officials that

are trying to grow the economy for the long term? john: it's a massive issue and i think it is becoming, you know, more central to a lot of the debate in canada. the challenge of course is, you know, we are ramping up our population. in a period now where we know housing starts are going to be trending down over the next years. new sales are trending down which means the starts will be trending down which is going to be putting probably even more pressure on our housing market and of course, we are going to see if our policymakers can even keep up with their population targets. at some point, you're seeing people just leaving markets like toronto because they are unaffordable and moving to smaller markets in search of housing affordability effectively. kriti: certainly something we will keep our eye on. thank you as always. a crucial issue. i want to get a quick check on these markets. the s&p 500 down .1%. do we end the day in positive territory?

more markets coverage ahead. stick with us. this is bloomberg. ♪ when you automate sales tax with avalara, you don't have to worry about things like changing tax rates or filing returns. avalarahhh ahhh

romaine: finding the balance on this thursday afternoon. s&p 500 still below 4000. strong rally we had to start the morning now a distant memory. romaine bostick alongside sonali basak. getting ready to start the close trade >> the s&p still down on the day. romaine: keeping an eye on some of the technical days. a few weeks ago we were talking about the big break on the moving average grade those averages being tested to the downside.