kriti: big tech reading s&p 500 games -- gains, outperforms and the nasdaq. bloomberg market starts now. a quick check of the markets, do not let the surface fool you. s&p 500 higher by 2/10 of 1%, the outperformance is in the nasdaq, big tech leading all the way. is this a defensive trade or our earnings worthy of the gains? we will ask kristina hooper of invesco in a few moments. 3.45 on the 10 year yield, higher by five basis points.

it really calm month of april -- eerily calm month of april, the fed meeting is in seven days. the bond market and the currency market on two different pages, as the yields go higher the dollar should fall. that is not what is happening. down to the tune of 2/10 of 1%, something that is not giving a tailwind to the commodity complex. trading with a 76 handle. one of the big stories we continue to monitor is the first republic story. take a look at shares and how much it is moving, a drop of 54% on top of the carnage from yesterday. we have a big bid to see what can be done to salvage the company, or not. you are seeing the stock -- investors in the stock -- something we are monitoring,

shares down about 54%. earlier today, the jp morgan cio discussed the importance of a bank like first republic under the current regional banking uncertainty. >> it is somewhat naive to say that this is just limited to first republic. if you step back and think about it, this should never have happened. this after the most heavily regulated s industry on the planet, banking. the regional banking system is quite vital to the u.s., so i think it is a crisis. kriti: joining us for more on today's market moves is kristina hooper with invesco, i want to pick up where bob michele left off. it has been one month of eerie calm after two months of banking turmoil. how much of the credit crunch narrative is baked into the markets? kristina: i certainly think there is some of the narrative baked in, that is the big result.

that is the major take away from what we have seen in the banking crisis, credit conditions are tightening and are likely to continue to tighten significantly. kriti: when we talk about tightening significantly, what does that mean for the federal reserve? i think 25 basis points of a hike baked into the markets when you look at the may meeting in seven days -- it looks like we are getting scarily close. what does that mean when you look at the trajectory throughout the summer? kristina: with the fed needs to do is take a step back and recognize how significant the tightening of credit conditions will be in terms of furthering its goals. it is not necessary to hike much more, if at all. while there is an expectation the fed will hike rates 25 basis points in seven days, i think there is a good chance we get no rate hike at the may meeting. kriti: that would signal some

sort of panic in the markets, does that set up the s&p 500 for some sort of downside, what is the signal? kristina: we are lucky we have a press conference after every meeting, that is the opportunity to explain the rationale behind hitting the pause button. there are a lot of reasons why the fed could do that they do not suggest there is cause for panic at all. kriti: lucky to have a fed presser, i love that. that is the contrarian statement of the morning. perhaps saying the job of the federal reserve is done, we do not need more hikes, the inflation story will come down. when you look at the earnings story, a lot of the macro topline numbers show that sales are decelerating, you are seeing a slowdown in the consumer, whether it is microsoft alphabet or someone like ups fedex. when you start to see corporations like the ones i named able to weather the storm,

is that a good thing, is that sustainable? kristina: first of all, what is a good thing is that the sales are decelerating. that is what the fed wants to see. is it a good thing they can weather the storm? i think so. we want to see is some level of resilience in the face of rate hikes. how much more pressure, how much more damage can we all would stand the economy goes into recession? we typically have a 12 to 18 month lag between when policy is implemented and when it shows up in the economic data. we have some cumulative rate hikes that still have not arguably hit the economy or earnings yet. i am comforted to see the resilience, because i know it is going to get harder before it gets better. kriti: the resilience is largely coming from price hikes, he saw that in fedex, ups, even in

chipotle earnings. the higher cost consumers are able to weather. to what extent does that make the fed's job harder in terms of making prices sticky for long-term? kristina: it certainly makes the fed's job a bit harder, but i do not think it is all just price hikes. we are seeing some very significant layoffs as companies try to cut costs. it is a much bigger picture than just price hikes. yes, it does make the fed's job harder. but with the fed is focused on is services x shelter inflation. we are seeing significant progress in if the fed were to sit on its hands and wait, we would see more progress. kriti: david coston at goldman sachs was on bloomberg television earlier this week and said this is a great earnings season, but not as great historically. do you agree? kristina: i think that is absolutely true. i do not think it is a great earnings season, period.

we are seeing companies that are largely beating earnings expectations, but those are very downwardly revised earnings expectations. i think we just have to not look at earnings with rose-colored glasses. this is not a great earnings season, but it is to be expected, given what the fed has done. kriti: the carnage of last year baked into the equity market, thank you as always. crucial insight and we are knee-deep in the earnings season. coming up, illumina is ready to cut costs after reporting results. fighting for a seat at the table, making it hard. we will speak to the ceo, francis desouza joins us next. this is bloomberg. ♪

kriti: shares of illumina dropping after it announced it would cut $100 million in costs after pressure from kyle icon who accuse the company of destroying value through its acquisition, they are now ordering illumina to divest saying it would destroy competition and innovation in the u.s., that is just the start. francis desouza joins me on set. but a start with the earnings story specifically. to be fair, a big beat on it comes to clientele and specifically your gene sequencing machine. it is coming from an unlikely source, not your traditional academic institutions. walk us through that. francis: it is interesting to watch the launch of our flagship

sequence, the most powerful on the market. we announced in the fall and started shipping it in q1. what has been exciting as the demand coming in. we announced that we had orders for over 200 sequencers, that is the biggest book of demand we have had for any sequencer we have launched in history and we are celebrating our 25th anniversary. the other exciting thing is to see how manufacturing has ramped. we said we would launch between 45 and 60 sequencers, we shipped 67. most interesting is what you touched on, where the demand is coming from. we got interest from large academic research centers, which we expected. we got a lot of demand from clinical customers. we sell to clinical customers, hospitals, diagnostic services labs. but they tend to be a slower adopter in terms of adopting the new sequencers, they wait until

it has been out for a while. but 40% of the orders came from clinical customers. it is exciting to see they are embracing it and looking to the power to allow them to get into new service offerings. kriti: the pricing pieces interesting. on of these machines goes for $1.2 million, which is a lot of money. let's talk about pricing per genome. 2007, 150 thousand dollars, you've brought it down to what? francis: $200. kriti: get the clientele are price-sensitive, over a 100% drop in pricing. how do you retain the client base after you've made so much progress? francis: what is exciting about the market is that we believe we are tapping into a very large market, $120 billion market that is enabled by bringing the prices of sink wincing down into making genomics more accessible.

today, 4 million people in the world have ever had their genomes sequenced once. looking to the future, we believe a majority of people will have themselves sequenced several times over the course of their life to manage lifetime health, understand what diseases they are susceptible to, what drugs would look best, what drugs would hurt them. we believe we will go from a world were very few people have been sequenced to sequencing being part of routine life. to make that happen, we've been focused on driving the price down. we've taken prices down to $200 a genome and we are not stopping. we also focused on getting reimbursement for the tests, so people can get access without having to pay for themselves. our teams have helped give reimbursement for genomic testing for over one billion people around the world, for things like cancer therapy,

noninvasive prenatal testing and diagnosing babies. kriti: i imagine a lot of that is coming from the developed world, you've yet to target emerging markets in terms of affordability. it feels like this is a lot of pressure when it comes to actual margins in the next five years or so. francis: the 200 orders i talked about, even before we started shipping, these orders came from 30 countries across five continents. we are starting to see genomics penetrate beyond just the developed world, we're seeing countries in the middle east and asia embracing genomics as part of their health care system, primarily around diagnosing genetic diseases, treating cancer patients. the other thing that is fundamentally enabling his we redone our entire chemistry associated with the sequencer so

we can ship it to customers without requiring gyri -- dry ice. the canal bridge and a mix into their country, without having to send samples out. that opens up the market. kriti: as i am listening to you talk, it sounds like an amazing product and plan. the stock does not seem to believe that. five years ago, it was $500. it is now trading at 211 is what i'm looking at now. how do you plan on re-instilling confidence when it comes to shareholders? francis: our focus right now is to drive growth in the business. the new machine achieves a few things. it catalyzes the upgrade cycle, which is good in terms of driving revenue. it continues to expand the market for genomics. the lower price point opens up

new clinical markets and research opportunities. we have customers talking about doing larger experiments from a research perspective to understand how genomics drives cardiovascular disease, neurological conditions. we want to drive growth through new offerings and secondly -- we touched on this yesterday, we want to continue focus on expanding operating margins. we announced an initiative to take 100 million dollars in costs out of the company by the end of the year and expand the margins to 25% next year, than 27% the year after. driving growth and making sure more of it continues to fall to the bottom line will be helpful in terms of investors. kriti: $100 million of costs and operating margins, something that should be rewarded by a stock market that is trading on the marginal success. yet shares are down about 3% today. at the core of the cost costs is

pressure from carl icahn. i want to read a quote of something he said, when it comes to one of the acquisitions. if illumina wins the appeal, the company will be saddled with years of massive operating losses and unproven technology and no synergy between the businesses. if illumina loses the appeal, the ceo is once again completely obfuscating the almost existential risks that will occur. he will have you believe the defenseman process will take only months, that is the understatement of the century. those are some powerful words from carl icahn, walk us through the timeframe. he is saying it would take only months, why is he wrong? francis: they have developed a blood test that has been on the market since june 2020, a blood test that is available today and

partnered with institutions like the mayo clinic and cleveland clinic. they've done over 85,000 tests in the market since the launch. it is a proven technology and there are large studies that show the efficacy of it as well as the performance metrics. they also have a partnership with the nhs in the u.k., they are running a study for 140,000 people. it is a technology that is well spent, has big studies behind it. working with some of the leading cancer institutions in the world. in terms of the synergies between them, it is a blood test. it can help a person know if they have one of 50 types of cancer. it catches them across early stage to late stage and that is important, because cancer kills 10 million people every year. 600,000 people. kriti: but the defenseman process is what shareholders want to hear about.

francis: here is the reality. on its own, the blood test is launching into countries by 2030, the u.s. in u.k. as a self-pay test that cost $950. here are the synergies. kriti: i want to hear about the timeframe, because that is what shareholders want to hear. francis: we created a defense to chair workstream -- divestiture workstream that will lead a timeline that goes into next year. we are running the appeals they get to a decision by the end of this year, beginning of next year. we should be done with regulatory uncertainty as we get to early next year. that is first half of next year. kriti: how long does the process take? francis: it is starting now and should wrap up in that timeframe, by the first half of next year. kriti: so around 12 months.

it's talk about the actual legal process. european regulatory bodies seem to be coming down hard on the tech space. we heard this morning about the activision deal getting pushback from the u.k. regulatory authority and pushback against facebook and a horde of other tech companies. ai, heart software. to what extent is that flowing over to the biotech space? francis: the process we are in is in european courts, we are wrapping up the process with the european commission and headed to the european court of justice to look at an appeal. the european commission has waited on an acquisition between two american companies, they have no business in europe, no employees. so this is the first time the european commission is seeking to block a deal where the target company has no active business in europe, that is what we are challenging. we want a ruling around the

jurisdiction the european commission has on two american companies were the target has no plan business in europe and the process by which it was done. kriti: it sounds like, at the end of the day based on the stock performance and analyst read through, there's a lot of fatigue around how illumina is handling the situation, something that fostered this move from carl icahn. how much pressure are you facing to end this? francis: we are moving as fast as possible. there is no shortcut here, nobody has a shortcut. you have to work through the process and it winds up early next year. all the things we can do with the european commission, we are committed to getting through this as expeditiously as possible. unfortunately, there is no shortcut through the process.

kriti: why not find a buyer and help the shares out? francis: the european commission is for having anybody from talking to buyers until the divestiture order comes out and they lay out the path. there is not a path where you can call buyers and running quick process, you have to work through the european commission process. kriti: i am sure that is taking a lot of time out of your schedule. illumina ceo joining us to talk a pretty crucial story, stick with us. this is bloomberg. ♪

kriti: this is bloomberg markets, time for the wall street beat. we have a warning on credit. an interview, he said i think there is going to be a huge problem in private credit and you next year, some investors talk about how great it is to be able to buy 11% yielding secure

loans, as if it is an amazing environment. tell that to the companies that have to pay so much more in interest expense. his words, not mine, but some crazy comments when it comes to these fears. here to discuss more is claire boston. it is clear he is joining a chorus of people warning about the private credit crunch. the way he is trading it, the way he is hedging against it, walk us through that. claire: he is someone who is playing the market, this is one of the more complicated places, very much a hedge fund specialty. it is interesting but he is doing now, trying to find the big mispricing's. one thing he is doing is looking to buy some of the riskier areas like financials while selling on things he thinks are safer. he talked about apple. no one in the market thinks apple is going to the fall soon, but it could be an interesting place to hedge. kriti: that was my exact read,

who bets against apple? it is like betting against the u.s. government, with a few caveats. how successful is the hedge, it feels like he is a contrarian. claire: when he was talking to bloomberg about the apple trade, he is looking to take a position where banks are looking to de-risk. can i take the other side of a trade when we are in a risk off environment? he is expressing the view that the apples of the world are going to be ok. kriti: something to keep in mind as we talk about the ripple effects in real estate and the loan origination from community and regional banks facing pressure, claire boston, thanks for the coverage. the s&p 500 trading flat, the real action is in the big tech stocks in those companies claire was just talking about. mastec higher by 1%, 10 year yield at 3.45. inching its way closer, not

taking the dollar with it. our markets coverage ahead, this is bloomberg. -- more markets coverage ahead, this is bloomberg. ♪

john: walt disney company is suing governor ron desantis, alleging he is retaliating against the company and threatening billions of dollars in business. the lawsuit accuses the government of orchestrating a targeted campaign of government retaliation amid an escalating dispute over a board that the governor appointed to oversee government services at disney world. kevin mccarthy made changes to the debt limit bill. tax breaks have been restored, that was a demand of midwestern lawmakers and the measure will accelerate requirements for medicaid. china's president told volodymyr zelenskyy the only way to achieve peace in ukraine is through negotiations with russia. in their first conversation

since the invasion, he also told the ukrainian leader that china will send an envoy to visit kyiv. ukrainian officials called the conversation an important dialogue. global news, 24 hours a day, on air and on bloomberg originals, powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. jon: welcome to bloomberg markets. kriti: a lot is going on in the macro space. jon: there certainly is, let us walk you through the equity and fixed income story on this wednesday, looking at a somewhat flat s&p 500. we might not be in the green if it were not for the technology stocks, we are seeing the nasdaq performance show 1% gain on the day overall. the 10 year yield issued below

3.5%, the two year yield a shave below 4%. we are getting some news on the bank of canada, they recently started sharing minutes from their recent meetings, much like the u.s. federal reserve. the bank of canada has been on hold with rates for the last couple of meetings, because they were concerned about canadians having too much debt without higher interest rates. we just learned that as officials consider raising rates in april due to stronger-than-expected growth, they ultimately decide to keep rates unchanged, given inflationary trends showing signs of easing. we will watch that story as we get ready for kriti: the fed decision next month. part of that decision is reevaluating the banking turmoil, which brings us to crucial movers. first republic shares are tanking again, down 21% on the day. even as you have a lot big banks infusing liquidity, it is not enough. shareholders are running for the exits.

another stock is visa, they came out with earnings. they saw more cross currency payments, more people are traveling, visa gets more money out of it. as we see the rest of the market pullback, visa shares follow down about 3/10 of 1%. also tracking moves in the tech space, you talked about the outperformance and the nasdaq and how the s&p 500 may not be positive if it was not for a name like microsoft. higher by 8%. artificial intelligence pushes the shares higher. there is a lot of pain on activision blizzard, microsoft getting the no go from the u.k. regulatory authorities. shares tanking by 11%. jon: a notable decline. another stock we are watching is the canadian mining giant tech resources, which surprised many by canceling a vote to spin off the coal business. the ceo saying the plan going forward is to pursue a simpler

and more direct separation, which is the best path to unlock value for tech, shareholders. glencore had been pursuing its own teck resources plan to acquire the business, they rejected proposals remain a nonstarter, with the same flood structure in material execution risks identified by our board. andy bell has been tracking the story and covers the commodity sector. teck resources, once again, saying no to glencore. but clearly, they got a reality check from investors on the way by which they wanted to split up the business. andy: teck is still in play. they have a lot of the multiple voting chairs, they say they are open to a transaction, just not with glencore. they do not like glencore with its checkered history of fines for bribery or settling

settlements for bribery. it is a classic example of keep it simple. they announce this elaborate spin off of the coal, where the coal would go on funneling cash flow back to the mining for years. called a greenwashing, they are spinning off the coal. still pocketing loads of money. jon: a lot of people today have been recognizing that as perhaps the issue they have to go back to the drawing board and figure out. in terms of the value of the metals business -- at the end of the day, that's been part of the story here in tech shares rallying in part because of bloomberg's reporting that there could be other players interested in the metals business. they are saying they'd like to get some kind of deal that separates the coal business and shines more light on the metals business. andy: they're going to do in a

simpler way. it is interesting that they misread the market, they announce this elaborate, complicated divorce that would leave the two operations entangled for years. there is no doubt there is widespread interest about compromise. it is much easier these days to just buy other people's compromise as -- instead of try to build your own. kriti: all over a crucial story that is turning from just a canadian story to a global story, we think you as always. the railroad company south of the border, norfolk southern,'s's profits took more than 380 million dollars worth of charges related to the derailment in east palestine, ohio in march. our senior transportation analyst is all over those numbers. now that we have the number, we have the cost. can investors breathe a sigh of relief? put this into context. lee: it might be premature to

have the sigh of relief, just because the fixing of the issues that were created by the february palestine derailment are still out there. norfolk southern is still remediating the land, they are making sure the property area where the derailment have been disclaimed. not only clean from an epa standpoint, but clean for the community that is there. they are not able to operate their trains as efficiently as cleanup continues. those costs are going to bleed into the second quarter. the good news is that it looks like the company is doing everything under its power to r ight the situation, following the derailment. it remains to be seen. i think the expectation going into the quarter was the expenses were going to be more than $387 million that the

company announced today, which about $55 billion were cashed. the impact was really felt across the network and you can see that in some of its fluidity measurements, we measured trade speeds. a, they did improve in the first quarter -- year-over-year, they did improve in the first quarter. kriti: when we talk about margins when it comes to the railroad operator, put this into context relative to the rest of the industry. it feels like you look at the margins of railroad operators like norfolk southern relative to trucking companies like jv, railroad operators are doing better. is norfolk southern saying the same thing? lee: when we look at norfolk southern's margins, we've got to take out the impact from the accident. when you do a takeout -- when you take out, it impacts it

year-over-year. a lot of that has to do with inflationary pressures they are facing. railroads in general tend to be more profitable from a margin standpoint, relative to trucking . truckload, some of the best operators, if they are operating in double-digit margins, that is a well-run company. railroads can operate anywhere between 35 percent and 45% margins. it is a much more profitable business. that being said, it is highly intensive, repairing return on capital. there might be somewhat simpler numbers. you are talking about miles and miles and fixed infrastructure that not only has to be put in the ground, but has to be maintained so we avoid the things we saw in february in ohio. kriti: the operating ratio weighing in on the shares, norfolk southern shares down by 1.7%. lee klaskow, thanks for walking

us through the earnings picture. coming up, the u.k. puts microsoft $7 billion takeover of activision blizzard in jeopardy. this is bloomberg. ♪ [office sounds] ♪upbeat music♪ ♪♪ ♪when the day that lies ahead of me♪ ♪♪ ♪seems impossible to face♪ ♪a lovely day (lovely day)♪ ♪(lovely day) (lovely day)♪ ♪(lovely day)♪

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>> in order to win the appeal, microsoft has to show that the u.k. authority had no legal basis. it cannot win the appeal by saying it is a lousy decision. this would be better for

everybody. clearly, they have some legal basis. kriti: this is bloomberg markets. eric gordon earlier on bloomberg speaking about the u.k.'s decision to block the biggest ever gaming deal, it is also the hour. they vetoed microsoft proposed 69 billion dollars takeover of activision blizzard, both companies pledged to appeal the decision. for more, let us ring in jennifer. it is not a surprise, antitrust and tech goes hand in hand. it is an environment globally were big tech is not allowed to make the acquisitions it was allowed to make five or 10 years ago. walk us through the consequences for a company like microsoft, what messages it sending? jennifer: it is sending the message the regulators are saying what they are going to do and they will do what they say,

they are suspicious of big tech and will scrutinize deals and are particularly going to protect deals that are affecting upcoming markets and innovation. the next biggest thing and digital. they are altering to make up for lost time. there are a lot of regrets, particularly in the u.s., for having deals like google doubleclick and not looking to the future. so now, it is a most like they are going the other direction. they're going to be careful, look at small deals that big tech platforms make. jon: to get into the legality of it, if one side is saying there is too much control and the other is saying no, we would not have too much control, what are the determining factors? jennifer: here, i think this is all about remedies. i do not think any of the regulators -- u.s., u.k. or e.u.

-- would disagree there is a viable theory of harm. maybe microsoft with this company could have too much clout over a gaming market. gaming services provider market. the issue is, once upon a time, remedies could easily fix this kind of concern. the companies would make a promise, we are not going to keep our games from our competitors. we are going to make them widely available. for years and years, this was sufficient and worked for this kind of deal. but the last couple of years, they said we do not want to accept this behavioral remedy and that is what happened with the u.k.. microsoft said we will make the games available, we will not exclude anybody or harm competitors, but that was not good enough. kriti: what will it take, what are they looking for? jennifer: they're looking for a remedy that completely replaces any competition loss a virtue of the merger, that is hard to do. it would've been the best call

of duty, microsoft is not going to do that, the whole point of the deal. so they were in a difficult position. sometimes, a licensing deal can do it, because it is considered structural. you are handing over rights to another company, but not the kind of deals that microsoft was doing where it maintains the rights, the pricing, the ability to affect the way the game performs on somebody else's hardware. so i think that companies really cannot go forward if they think they are going to win the day with a behavioral remedy, they have to have a structural remedy. deals that are not vertical in nature but just to companies that compete and could selloff division to get rid of the competition, that deal may still be able to go forward. jon: what does a company like activision supposed to do? we saw the stock market reaction, the processes are very long and staying committed to, the language has to be appropriate for the moment.

but there is the immediate reaction we see in the markets, people trying to figure out what happens next. jennifer: the companies have said they will appeal, that is a long slog with an unlikely successful outcome. it is difficult to overturn a cma decision. they also have a long process in the u.s. because they are about to go to litigation in august against the ftc over this deal. i am not sure the deal can survive that. if activision is looking to be bought, the need to look for a company that is not as strong and clout. microsoft strength and clout was what was one of the uk's biggest problems here. it is not that activision cannot get itself sold to some other company, it is going to have to be a company that has less power in that area. jon: really helpful context, jennifer rie breaking it down. we will continue to watch the microsoft activision story. coming up, the new legal fight between disney and florida's governor, this is bloomberg. ♪

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jon: this is bloomberg markets. we have been covering the developments with disney suing florida governor ron desantis, alleging he is retaliating against the company for speaking against his policies and threatening billions of dollars in business. caroline hyde joins us with more

details. you've been talking to a lot of industry players about the disney development, what have you been hearing? caroline: it is a history lesson, this few dates back a year or so to disney itself taking a stand against a very controversial bill that ron desantis put through in terms of education, many opposed that bill, calling it the don't say gay bill. all of this in many ways was leading to the ousting of the previous leader of disney, who bungled the handling. disney speaks out against ron desantis, ron desantis decides to take charge of the minutes of the authority -- the municipal authority that oversees day-to-day operations at the park. disney out maneuvers them, manages to reduce the power of the municipal authority and be here last week that ron desantis is thinking about building prisons near the theme park.

all of this has meant we have a lawsuit filed in a federal court in florida, because they think this is bad for disney's business, which is the biggest taxpayer and all of florida. kriti: it is worth mentioning that ron desantis is expected -- he is not formally announced, but expected to be a contender for the presidential election. a quote from disney sainted targeted campaign of government retaliation orchestrated at every step i governor desantis as punishment for disney's protected speech now threatens disney's business operations, jeopardizes economic future in the region and violates its constitutional rights, that coming straight out of disney's press office. mary the politics here for ron desantis, what incentive does he have to do this? caroline: when you are looking at the overall percentage of where the alignment of florida voters go, many do not want to see combat between a governor and companies, they do not want to see business implicated.

but for ron desantis trying to make headlines, gain ground against donald trump, he might well run for the 2024 presidential election, he thinks this is winning him overall votes on the far right. ron desantis, we understand from his own public relations response, has been they think this is another example of disney trying to operate outside the bounds of the law. bob iger and disney weighing into a political furor, you know why disney does it. many feel the employees it is responsible for its own key network of people and therefore a key talking point for them is they feel their rights are not being heard at the moment by the new ways in which ron desantis is looking at parental rights in education, the fact you cannot instruct on sexual orientation or gender identity in schools. they are trying to answer to people that they feel

responsible for. jon: you talk about the employee base that disney has in florida, you've also been covering on bloomberg technology the reality that disney is navigating through a challenging time with their own workforce and the cost cuts they been committed to. caroline: this is a time of company row -- company morale. the theme parks have been outperforming, the key area of concern is the amount they have to invest in the overall disney plus offering, the fact that you and i consume, in a different way. that has been a key focus. we are going to hear from meta after the bell, they too have been shedding key percentage of their own employee base. but they've got to stand up for a key area of morale when they are having to undermine it by letting people go at the moment across florida and across

corporate disney in general. kriti: the last 30 seconds. when you talk about disney shares -- should cover this on bloomberg technology all the time. it is no longer just an amusement park media presence, it is a streaming platform, absolutely. does this matter for the stock? caroline: no, does not seem to. when we broke it down on air, it was out of a 10th of a percent. i think people will have to wait and watch to see how it plays out. i am sure many a shareholder did not like economics and politics entwining this way when it comes to corporate america. kriti: it is still down 1/10 of 1%, we thank you as always for walking us through the disney story. when it comes to broader markets, the markets are dropping. perhaps the negative tilt you are seeing a disney shares is a reflection of what you are seeing in the broader s&p 500, down to tense of one person in underperforming shares of disney. even some of the gains in the nasdaq getting paired.

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>> here's the first word. whilst this the company is suing former -- florida governor ron desantis. lawsuit filed today accuses the governor for having a target campaign of government retaliation. the accident that dumb chemicals on a small town that cost the railroad company $387 million in profits. the united nations sheep is urging the international comm