>> welcome to bloomberg markets. let's get a quick check on what is going on in the equity market because we have decidedly a down day. s&p 500 lower by point 4%. nasdaq 100 a little bit more resiliency, still down by .2%. for both of those benchmarks, coming off about six straight weeks of gains, so taking a little bit of a breather as we await earnings season, getting into the heart of it as we await that fed decision and presidential election coming in 15 days. you are looking at the bond market, the selloff accelerating.

10 year yields currently higher by nine basis points. 4.17 on the benchmark treasury yield. volatility in the equity market building right now, still below 19 but trading a little bit higher on the day. let's get some mid-day movers on the equity side. we will do that with abigail doolittle. abigail: potential deal news. humana and cigna both lower. earlier, humana was higher from a report that cigna and humana were back and talks for a potential deal. this report came out late last week. this is the second time we have heard this kind of report this year, would create a very large company with more benefits spanning a greater degree of workplaces. market capitalization would be close to $125 billion. one analyst at mizuho is saying it's a matter of when, not if.

right now, investors not favoring it. weakness in the airlines, broadly lower. united airlines actually higher at this point, but don't talk, american all lower. southwest, there is talk about them trying to ease tensions around elliott with a proxy fight. united up slightly. spirit airlines up about 50% on the fact that it's been able to extend some financing. one pressure on airlines today, oil is higher. typically an inverse relationship. with oriole up, that is a weight on the airlines, ex united airlines. nvidia up 2.3%. some analysts and strategists are saying what will be key for nvidia and whether the strength can continue is the big tech earnings next week.

will they give more loft to nvidia? nvidia report november 21. interesting to note when we had that big selloff, a lot of shareholders selling, including ceo jen-hsun huang. since his selling stopped, it seems the stock has stabilized and has now captured a new record high. katie: thank you. let's keep the conversation going with mike regan. i thought you were a crypto guy now? mike: a little bit on this, that. katie: let's talk about the call of the day, probably of the week, coming from goldman sachs, basically saying we are going to get annualized novel total returns of 3% over the next 10 years for the s&p 500. you think about what we have seen, this very long bull market that we have been existing in. there was not a specific

catalyst he was calling out. mike: the main thing he is worried about is the heavy concentration in the s&p 500. you look at these magnificent seven stocks, more than a third of the entire s&p 500, if you are going by the traditional market cap waiting, it is with the seven stocks. historically, it is hard for single companies to keep up this type of sales growth and high profit margins. he extrapolates that for the entire index and says when you have this much concentration in an index, it will be hard for the index to perform well. this report is catching a lot of attention. it is kind of bowl to predict 10 years of stock market returns all at once. one think he does throw out for the bulls, maybe you don't play the s&p 500 but the equal weighted version. sounds boring.

he says if this concentration starts to fail, the return should broaden out, anywhere from 2% to 8% from the equal weighted version. not as bearish as it sounds on first blush, if you want to shitnto the equal weighted strategy. katie: let's talk au the contours of his call. he raised his year and s&p 500 forecast earlier this month. 12-month target is 6300 11% over the coming years. one more year of the good times, and then -- mike: another fascinating thing over that 10-year span that he wrote, interest rates -- he has five criteria on which the model is based. interest rates was an interesting one. 10 year yields at 4%. 72% in that pond will beat stocks over the next 10 years. katie: i am cooking on

something, so let me run this theory by you. this theory to me looks like i call for cash. if yields are going to stay high enough to outperform, that doesn't imply that the fed will be cutting rates to zero. why wouldn't i stay in cash? mike: if the fed starts cutting and yields come down, you get that price return, yield on the bonds. cash works until you hit that inflection point where you know that rates have hit a peak and will start to come down. tricky thing to time. another big story today, t. rowe price strategists saying brace for 5% treasury yields. if you want to get market timing on it, maybe cash is the better way until you know that inflation is under control, the fed will start cutting aggressively and bring those yields down. tough call to make. katie: we were speaking to eric johnson earlier on open interest. he has a two-month tactical call

on small caps, then you want to get out. let's talk quickly about carson block. he joined bloomberg earlier today, saying if you look at the passive bid in the market, all of the 401(k) assets out there, that should support stocks from here. mike: kind of a bizarro world when we have one of the most famous short-sellers saying to by the mag seven. a lot to be said about what he is saying. as long as unemployment stays low, you will continue to have a lot of people pumping money into 401(k)s. what do they tend to buy? mostly these index funds. regardless of the concentration, that is a perennial bid for the traditional market cap weighted s&p 500. hard to argue against him on that. he is not making calls far into the distance as they did with this 10-year call, so for him it

would have to be a matter of timing, as well. if you are confident in this unemployment rate staying down, job market remaining strong, carson block's point makes a lot of sense. that passive bid will continue to bid things up. katie: michael regan, thank you so much. great to see you. let's turn to politics. we are just over two weeks away from election day if you can believe it, and the race continues to intensify. for more, we are joined by kailey leinz. walk me through the next 15 days, what does it look like when we talk about both of these camps? kailey: it will be a frenzy of visiting the state that could decide the electoral college and the election in its entirety. kamala harris visiting all of the blue ball states, michigan, wisconsin, and pennsylvania with

liz cheney at her side as she tries to court moderate voters. donald trump was speaking in north carolina, another bout of ground we are watching. he will be traveling to some of the other states this week as well. it will be frenetic. it is not just the candidates on the trail. not just a but the obamas, barack obama and michelle obama will be alongside harris in the coming days. elon musk is out in pennsylvania not just holding rallies in support of donald trump but offering a million dollars in sweepstakes every day between now and november 5 for those registered voters who sign an online petition supporting the constitution and right to free speech and bear arms. at this point it will be about driving turnout, getting voters excited to go to the polls. we know that there are millions that have already done so. this election is already technically underway. katie: a lot of mobilization happening at this stage in the game. there is a great story on

bloomberg.com about harris and trump scrapping for those few undecided voters. how big is that cohort of voter? who is still undecided? kailey: it's a very small number. the vast majority already have their mind made up, whether they will support donald trump, kamala harris, or neither of these candidates. those that are still able to be influenced is small, even smaller in the seven battlegrounds that ultimately hold the keys to the electoral college. we could be really talking about tens of thousands of voters at this point which could be the margin. we are talking about all of these polls in these states showing them consistently within the statistical margin of error. even if we are talking about 1% of voters undecided, that could make the difference between a win or loss for any given candidate, which is why the mobilization effort is so important here. a big part of that is money. the latest fundraising figures

from the harris campaign and showed she raised 370 $8 million in september, about 2.5 times the 106 $2 million of the trump campaign raised. she is also outspending him by 3-1 on advertisements, on the ground again, things that could drive voter turnout. katie: we will see the return on that investment in about two weeks time. kailey leinz, thank you so much. our stock of the hour is up next. we are keeping our eyes on boeing as it enters a critical week with investors looking to see if there is changing winds for the aerospace giant. that is next. this is bloomberg. ♪

katie: welcome back to bloomberg markets. it is time for stock of the hour. we are looking at boeing as it enters a turbulent, critical week. shares climbing on news of a vote on wednesday that would and boeing's ongoing labor strike. that vote is expected hours after the company's earnings report. we are joined by gabelli funds portfolio manager tony bancroft. so excited to speak with you because i have spoken to analysts about bowling, reporters about bowling. really interested to get the investor take. needless to say, it's been a rough ride for boeing shares this entire year really how have you been investing around that, thinking about your positioning in the stock? tony: great to be here. as you said, it's been a long road for boeing this year. i think the big picture is the

secular tailwinds that are impacting the commercial aviation industry have not changed. if anything, have incrementally gotten more positive. demand is high, a decade of backlog or both of the oem and commercial travel continues to increase. boeing is at the center of it. there is obvious near-term headwinds going on now with the union contract, potential equity isace. most of the bad news overall is behind us. now we can look forward and get this contract hopefully done this week. if not this week, very soon, then move on and start looking ahead past these earnings. they have already been preempted on.

then start to see where the company is focused on next which is definitely the gap for the 737 max. katie: interesting to hear your commitment to the main. you mentioned deductibility fund. what would change your mind? we are already down 40% year to date. what we do need to see before you say it is time to trim, throw in the towel on boeing? tony: i have hung on this long. i think most of the bad news is out. probably not much more that we will see on the downside. obviously, this negotiation going on longer than expected. bowling i think has a good plan in place. i think in the long term it will do well. in the near term of course, more news in defense names taking

charge for this quarter preemptively. just seeing that. hopefully that will improve. overall, it's a good long-term value story and growth story for that matter for boeing and industry. katie: the new ceo is coming up on his first earnings call as ceo and has already been active in the past couple weeks. job cuts getting announced from boeing. talking about the need to be clear right here when it comes to writing the ship over at boeing. what would you like to see kelly or berg do when it comes to strategy? it comes up all the time, whether they should spin off the space business, for example. as a business, what would you like to hear? tony: the number one thing to focus on is the negotiation and then after that, definitely the

focus on getting the faa to lift the 38 per month rate cap for the 737. going past that you start looking at the defense business really some of that is just a runoff from an historic contract with how they did those, fixed price on the development side. that will eventually start running off and those contracts will prove. longer term as far as what you do with the restaurateurs -- no brain surgery here. boeing just doesn't have the comparative advantage on. anything that flies, commercial aerospace, defense business among both leaders in, one of the largest defense businesses in the world. one of the biggest commercial businesses in the world. anything that doesn't have to do

with that, they shouldn't be spending their time on. we have seen some news on that. long term, i think we have a good plan in place. once these jets start to be produced, it's a very profitable business, a lot of operating leverage in the business. the problem now is they are operating these factories which are not producing planes. they have had to deal with that, these jets not being delivered. once that gets cleaned up, it will be a pretty good business. katie: it is a long to-do list, but enjoyed the conversation, busy week coming up for boeing. appreciate you taking the time to walk us through it. that is aerospace and defense analyst tony bancroft. volatility still elevated today but will terror threats and election uncertainty keep the markets anxious beyond election day? we are digging deeper, next.

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katie: welcome back to bloomberg markets. tariffs have become a huge topic in the final weeks of the election season with wall street bracing for potential shifts in policy from a trump or harris administration, and any other pressure that could induce

volatility. for more, we are joined by abigail doolittle as well as steve selznick. i can look at the vix to get a sense of how this market is feeling about volatility but where else should i be looking, keeping an eye on anxiety around tariffs specifically? steve: great to see you. the vicks is a great place to start in terms of the market mentality. i'm not a firm believer that it is a fear gate, more of a proxy for the demand for hedging. it tells us there is still some demand for hedging and the race is not necessarily done yet. the next sector i look for witches to me the bellwether of all bellwethers, semiconductors. if i plot the semiconductors sectors as an independent variable, it moves the nasdaq,

s&p 500. correlation is not causation but that is the most politically fraught sector even beyond energy and industrial policy. those are the places i keep looking. abigail: how much do investors care about this election? the growth for this quarter, 3%. the quarter before, 10%. after, 12%. it seems to have some impact but yet it seems like we are not having all that much volatility into the selection at least not yet. steve: i think it is because we don't know what is going on. yes, the poles have moved, prediction markets have moved. i say this as someone who has a forecast. but there is still no consensus as to what will happen, in terms of all the parties -- are they going to control all the levers

of power or not? that is what the market gets concerned about. we cannot ignore in the earnings in interest-rate policy all of which are converging at the exact same time. i might argue that we are particularly not as concerned as we might otherwise be or maybe should be. katie: we have to get you back on for a longer conversation. we are just getting started but we are up against the clock. steve sosnick, thank you. quick check on the markets right now. look at the s&p 500, lower by .3%. if you look at the sector level, only one sector in the green, technology, currently hired by .4%. all 10 other sectors are in the red right now. real estate is your biggest loser, down by almost 2%. that does it for bloomberg markets. . this is bloomberg. ♪

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heads for its final two weeks. welcome to the fairness show in politics with 15 days until election day. new polling out shows the race is tired. i'm joe mathieu alongside kailey leinz in washington. welcome to the monday edition of "balance of power." i guess it's no mystery morbi we find the candidates back in the swing states today. kailey: no surprise for kamala harris, focusing specifically on the blue wall rust belt states of pennsylvania, michigan, wisconsin with none other than former republican congresswoman liz cheney by her side as she tries to reach across to those moderate republicans with just 15 days to go. with a record early voting turnout in states like georgia and north carolina, it's a good reminder that this election is well underway. joe: some people have already voted, which is important to consider the message and we are continuing to see it evolve even after some have already made up their minds. we will talk about that.