vonnie: welcome to bloomberg markets. we have risk on rallies as we hit noon in new york. a repricing in the bond market after core consumer prices eased in december. we are back in the green for the year for the s&p 500. we are off our highs on the session. the nasdaq 100, the key performance metric in these markets, up 1.7% and we have given up 12 of those basis points. we are at 4.67 on the market. the dollar index did strengthen below 1.09. we are back above 1.09 now. the nasdaq gave up 15 basis points this morning since the

data came out, putting march ever so slightly back on the table. if you take a look at individual movers, we've been concentrating on banks today because earnings season has gotten underway and with some flare. citigroup up more than 7%. it says it will repurchase $20 billion of its stock in the coming years and showed improving revenue through all five of its main business lines. goldman sachs profits doubled in ceo david solomon says he sees a more constructive environment under incoming president donald trump and that is sending their shares up more than 5.5%. jp morgan traders saw a record quarter fixed income in particular helping revenue up 21% for the trading division. it also had the highest annual profit in the history of american banking once again. jp morgan up 2%. the bitcoin related stocks are seeing their own rally as bitcoin takes another run at

$100,000. coinbase up 6.5%. getting back to the inflation data and what it means for the federal reserve. last week bank of america economists made the bold call the fed cutting cycle is over. earlier we can't up with the firm to see if today's cpi data change that forecast. >> i don't think it changes our mind. it is a good number. .2% on the core pce. we were below consensus on 26 basis points. if you look over the last three or four months we are running around 2.5% which is where the fed thinks will be at the end of this year. by the fed's admission inflation is stuck around 2.5% and on top of that the labor market seems to have stabilized. that was the primary reason they were cutting. we do not see any reason for them to keep cutting going forward. vonnie: joining us with more on the cpi and the federal reserve is bloomberg's michael mckee.

nothing completely fell off a cliff in terms of prices but there was movement in the same direction we have been seeing movement in. michael: that was the good news. it was a softer report which turns out to be good news for the bond market. we saw the cpi come in hot. .4% higher for the month but that was mostly energy. on a year-over-year basis 3.2% for the poor, which is down .1% from the last four months. the fed can call that progress. the biggest increase is gasoline and natural gas. airfares and used cars, all things we expected. medical care, health insurance, parol, and for those of you following the political debate, eggs did not rise as fast as in prior months. what does this mean for the fed indicator, pce inflation?

it looks like it may be better than people had anticipated. yesterday we got some surprise increases in ppi categories that feed into pce but today's numbers walk that back and that red arrow in the lower right-hand corner might go away. the other two indexes have been pulling pce up but if it does not go higher that is good news for people thinking the fed might be done or could start again cutting interest rates. right now cpi did not tell us that what happened but as i mentioned we had the markets on watch for everything and they have been so nervous. this was the excuse they needed to go in the other direction. you sought immediately after the cpi report. the first fed cut had been priced september. now july. caroline: isn't it -- vonnie: isn't it insane the way the markets can reprice in seconds?

breaking news. israel and hamas have reached a cease-fire deal according to people familiar with the matter. we will go straight to washington, d.c. to hear what we know. what are people familiar telling us? >> after a lot of back-and-forth we are being told there is a deal. there had been a last-minute snag where hamas had put new demands on the table, including the complete evacuation of israeli forces but that appears to have been resolved and for the first time since november 2023 it looks like we have a deal. a lot of detail still to be confirmed. for the time being this is expected to bring a halt to the fighting. vonnie: we will want to hear from the white house and from the actors in the region. have we any idea what it might mean, how many days of a cease-fire, a permanent cease-fire, are there hostage

negotiations with this as well? nick: we are still waiting for those details. we did just get a social media post from president-elect trump. no doubt his team played a role in pushing this across the finish line and you can be certain israel would not have agreed to a deal unless there was an agreement around the release of at least some of the hostages who are remaining in gaza. the question is how many and when. the question looking forward, if there are violations to the cease-fire, what will that mean for its overall viability because we have seen there have been violations. we will have to see whether this sticks. vonnie: this is all just a few hours after national security advisor jake sullivan said hamas had been rebuilding and was practically as strong as it ever had been. nick: u.s. officials and biden

administration officials have been saying for the last day they have been on the brink of a cease-fire and they see this as the only way to resolve this problem. antony blinken said yesterday they believe that hamas has been able to recruit as many people as it has lost since october 7 of 2023. essentially saying to israel it is impossible to eradicate this group. their numbers remain undiminished and you will have to go through with a cease-fire because as those recruitment numbers show it feels like there is not a clear-cut military solution to the problem. vonnie: it has been 15 months of fighting so far. can you bring us up-to-date on how many negotiations have been ongoing, who will take credit for this cease-fire. they are in mind we still don't know if this is just a temporary cease-fire, just a cease-fire through the inauguration, and what will happen after trump

becomes president. nick: success has many people taking credit for. we know the biden administration and the incoming trump administration were involved in these conversations. trump's envoy for the mideast has been in the region. qatar played a crucial role. it does appear the pressure president-elect trump brought to bear on this did provide some form of accelerant. the common argument was prime minister netanyahu listened to trump more than he would listen to president biden. trump could essentially tell him it was time to do a deal as he had been signaling. it does feel at least in this case like president-elect trump will take a victory on this one. vonnie: thank you. we will wait for official word from the white house and other actors and see what this involves. the markets rallying already

today. it is hard to tell if there is any cease-fire premium built in but we will see throughout the day. back to the inflation data from earlier and u.s. economic policy. we are joined by former kansas city fed president. he was chair of the fdic and also played a supervisory role for banking while he was at the kansas fed. thanks for joining. does today cpi data put a cut or multiple cuts back in the cards? tom: different people take different interpretations but i thought the cpi was up 2.9%. core was slightly down. overall inflation is not coming down. that is the message i got from it. as i look at the economy more broadly i think we are in what i will call a modest inflationary boom.

we are coming off a strong 2024. you saw the bank earnings. strong earnings there. i think our investment in the fiscal side is stimulative. i am all convinced that inflation will come down. you look at interest rates. the inflation rate -- let's give them the benefit, 2.5%. if we want to take that number with the policy rate of 4.1 he 5%. real interest rates are not substantially high. that does not strike me as a tight monetary policy. given the recent cuts it is more of an accommodative monetary policy. there is a lot of stimulus and i think we will see more inflation. i do not think it will come down quickly and that is what the fed has to think about.

vonnie: we had been thinking about a rate increase after the jobs report. is that still on the table? thomas: at this point, no. the numbers are not going up that much. there'll be a lot of pressure not to lower interest rates. i do not think it is on the table immediately but if inflation numbers stay at this level if they stay at this level they are more likely to go higher than lower. then i think there will be pressure to raise rates should that happen. whether that does i don't know but there is a lot of momentum in this economy so i'm not counting on more inflation. vonnie: does that put us in the said position of wishing for a weaker employment report, social malaise in everything that goes along with it. if that does come along with president-elect trump tolerate that? thomas: it does make things uncomfortable given how things are.

what you hope is things will settle out. the economy for stay at a good pace and have improvements in productivity that help with the inflation number but that will take time. the fit is projecting 2.5% by the end of the year. i think there is some chance the economy has to slow. we have to see some slowing in the labor market and wage gains which are still 4%. not a booming economy. i think that is can we moderate sufficient to give everyone confidence and have the numbers show inflation coming down so we can cut rates. at the moment if we can keep rates where they are that may be a good thing. our economy can adjust to that. these are not are usually high rates in historical context. if we can stay where we are we might be you good shape going forward and have inflation come

down gradually and patiently. i do not know what the odds are given how much stimulus i see in the economy. vonnie: you know so much about the new role created after the great financial crisis. we know michael barr is stepping down february 28. what you anticipate that role will do going forward? there is concern there will be changes to the capital buffer roles, bringing down the 19% to as low as 9%. i say concern but from other quarters that would be good news. thomas: the banking industry would be very happy to see that and allow them to continue to lever up. the return on equity would be great and there would be a lot of support for that. as far as financial safety and stability, in an inflationary environment we know the banks have good trading revenues and so forth but they have quite a bit of loan increases that are

nonperforming, especially in commercial real estate. from the safe and sound point of view you want capital ratios to remain strong, especially as you see deterioration in the long portfolios. that will be the debate. whoever takes that job in whatever agency, how much can you trade off your confidence in the safety of the industry and the soundness of the industry even though they are showing good earnings how long will those last and what are the lists given the problems in the loan portfolios? vonnie: you are also fdic chair? what do you expect under the new administration as far as crypto guidance and guardrails for retail investors? thomas: whoever takes the fdic will be much more open to deregulation and much more open to cryptocurrencies and the banks role in that.

how much may be an open question. certainly there will be easing of the regulatory environment and i think that bodes well in one sense for banks earnings going forward but it also raises the ability of those banks to take on more risks and therefore we have more risk down the road should they become less well-capitalized and a little more risky. vonnie: looking forward to our next conversation. we will know more by then. former kansas city fed president. back to that breaking news. our own and reorder helping to break the story that israel and hamas have agreed to a cease-fire, bringing a temporary halt to the war in gaza according to people familiar with the situation. the agreement pauses more than 15 months of fighting that has all but destroyed gaza.

talks had centered on the release of hostages captured during the 2023 attacks on israel that's triggered the conflict in exchange for hundreds of palestinian prisoners. we will bring you more headlines when we get them. this is interesting in regard to president-elect donald trump. we are fewer than a few days out from his inauguration but before he is sworn in the process to approve members of his cabinet has gotten underway. both sides of the aisle are looking ahead to the confirmation hearing for labor secretary nominee. she has been making the rounds on capitol hill this week and even meeting with representatives from fast food chains to discuss things like wages and unionization. for more and what to expect from the incoming and ministration, i am joined by bloomberg opinion contributor catherine edwards. let's start with the potential new labor secretary. she is known to be prounion. the former representative lost her battleground race in oregon.

will that be good news for the working class, will the unions continue to have a voice under a president trump? catherine: we are in a historical moment in which supports for unions and unionization is cresting across the united states. supports for unions polls extremely well amongst americans. taking a step hand-in-hand with that public support as opposed of the trying to retrench and fend off a wave of unionization is welcome. you would like to see the american people will rule out. vonnie: the other thing you pointed out his labor force participation for women 25 to 54 has been going up and reached a record, 78.4% in the last year. what policies do you foresee under president trump that might keep that number there assuming women do still want to work outside the home? kathryn: the composition of

labor force participation told several different stories. what i focused on in my column is the fact that women who have children under five, women who have kids that they would have to pay for child care or find some type of care arrangement, their labor force participation has been following as overall primate participation for women has risen and that is because the support for the child care industry that had ramped up during the pandemic had been wound down and as the government for grants away from states and childcare providers the rationing of that care went up, the cost of the care went up and accessibility of the pair went down and children -- and women with children under five were leaving the labor force. vonnie: you anticipate we will see anything that might bring those women back into the labor force? kathryn: the private provision of childcare is a market failure. it has been getting more expensive and less available over the past 35 years and will

only continue to go in one direction. this market has no ability to become cheaper or more plentiful because the care of children is expensive to provide for businesses. the only change that will come for childcare is when the federal government steps up and does the job it should be doing decades ago to help more women and more families find care arrangements. caroline: -- vonnie: what does it mean if you break down the amount of women in the labor force into different demographics. kathryn: this is an abundance hypothesis. we want more workers in the economy. the size of the u.s. economy is well predicted by the number of people working in it. using a worker is losing a bit of the economy and losing a taxpayer. thinking about the consequences of labor force participation, they accumulate over time. a woman who has a one-year-old kid has been trying to work, she

cannot afford it, she drops out of the labor force, that can be a one-year decision, a five-year decision, or a 35 year decision. that is a loss of contributions to the economy and income tax revenues and family income the government is walking away from. it is an investment. it does cost money. it is not free. it has untoward dividends for our economy to have accessible affordable high-quality childcare, three things most families will tell you they have a hard time finding. vonnie: thank you so much for joining us. that is bloomberg opinion contributor kathryn edwards. coming up, citigroup releasing fourth-quarter earnings. this is bloomberg. ♪

vonnie: this is bloomberg markets. citigroup reported fourth-quarter results before the open. shares are more than 7% after the bank reported a beat on earnings and plans for a $20 billion buyback. for more let's bring in todd gillespie with bloomberg news who calibers -- it covers all things citigroup. quite the turnaround. jane fraser deciding capital plants are something she wants to implement. >> absolutely and this is something shareholders have been begging for. citigroup only gives clarity quarter to quarter. to have a $20 billion figure -- it is still not perfect. it is a multiyear plan and starting off with $1.5 billion this quarter. that will be underway.

generally speaking for the bank. it is a sweetener right now as jane frazier slightly rolls back her medium-term return on tangible target -- vonnie: she was really ambitious with this turnaround but she seems to be convincing markets and obviously it was a record haul for all of the banks. did citi perform? his morale good? todd: for sure. the underlying numbers are also good when it comes to revenue. revenue is good across wealth, u.s. personal banking, and i want to say one more but i will check that later. basically the underlying numbers are solid but the cost base for

the bank is still sticky. that is what they are desperately trying to bring down. vonnie: i want to turn to another story that is part of our weekly segment focused on retirement. the bank cutting back its 401(k) a compliment -- contributions for its highest earning employees and out as a plan to retain talent if it is cutting back things like 401(k) contributions. todd: this is the plan the bank has to lower the cap it is offering in terms of the 401(k) matching for its u.s. employees who are earning at least $200,000 a year. this is for its highest earning employees. that is going down from $21,000 to $12,000 a year. this is a plant that for the bank links to what we are saying just now. the bank is trying to limit its expenses. it needs to manage appealing to top talent and has maintained

flexibility for its workforce. a lot of people are still allowed to work three days a week at citi. there are gives and takes for employees at the bank. we are looking at people who are top traders and top investment bankers and financially savvy people themselves. they want to know the bank is backing them when thinking about their long-term plans so this is a disappointment for some of them and the bank is not sugarcoating that. vonnie: that is todd gillespie with bloomberg news. israel and hamas have agreed to a cease-fire deal, bringing at least a temporary halt to the war in gaza according to people familiar with the situation. the agreement pauses more than 15 months of fighting. we will bring you all of the latest including official confirmation of this as soon as we get it. coming up, we are continuing to look at the themes moving markets higher today. this is bloomberg. ♪

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>> welcome to >> get a quick check on market now. it is a risk on rally today and we are back in the green for the major indices for the year now. the s&p 500 up 1.5 percent, just off its highs of the session. practically everything is rallying including treasuries. look at the 10 year yield, down almost 13.5 basis points. it was down even more than that after cpi came in soccer this morning. the dollar index is back above 109 but we did move below that and we had bitcoin rallying as well so let's get to some of the day movers on the equity side. >> i am taking a look at quantum computing stocks because if you remember, they were down at the start of the week after you had mark zuckerberg as well as the

ceo of nvidia pushing back on the optimism but if you look at today, morgan stanley had an optimistic outlook, saying this was the year for quantum computing so you're seeing a big rally in that quarter of the market with quantum computing up more than 30% on pace for its best day since mid sambar. stocks of more than 1000% in the last 12 months but another pocket i am keeping a close eye on is builders firstsource, thinking about voting material source providers here and those have been benefiting and it is one of the best-performing stocks. it was at one point that's when this morning. there's m&a activity that is going on in that particular sector of the market right now so that is why you are seeing a big boost there. also if you look at the stock, it is tending to have fibonacci support levels so that is something to continue to monitor here and moving over, looking at what is happening in the retail space, lululemon is something that if you're looking at the symbol -- it is down about 3% on

pace for its worst day since mid december here. if you are looking in that corner, it had upgrades when you are thinking about the sell side estimates when it comes to wells fargo as well as morgan stanley, more optimistic on that because they have a better-than-expected margin during this conference they are having with investors so far this week but nonetheless, it is down because there is broader decline in the apparel group in the s&p 500 so that is why you are seeing that pressure today. >> thank you so much. the israeli shekel is actually improving just back to the breaking news. israel and hamas have deal, bria temporary halt to the war in gaza acit cost more than 15 monf fighting. joining uslancof power cohost kailey leinz. we did anticipate there might be some kind of announcement. we have not got an official announcement yet but the by then white house has been working very hard behind the scenes. kailey: not just abide in white

house but the -- the biden white house but the incoming trump administration. not just israel and hamas but other mediators like egypt and qatar who have been involved in this process for months now. this cease-fire agreement has been reached, has been long and hard fought to try to bring a consensus around what this agreement ultimately will look like. what had been reported earlier this week as officials were signaling that this was what -- getting closer to a reality. 33 hostages would be released. that are currently being held by hamas, prioritizing women, children, people who are injured, and people over the age of 50. israel would be releasing hundreds of palestinian prisoners from its prisons. we have not gotten confirmation yet but we are waiting to hear from the israeli side and the hamas side and we could expect to hear something from the white house as this has been long understood to be one of the

primary objectives joe biden wanted to achieve before leaving the oval office just five days from now and he's going to be giving his farewell address at 8:00 p.m. eastern time from the oval tonight and we can expect he will be talking about this, trying to take some credit as we are seeing donald trump to as well. he just posted on true social that this cease-fire agreement could only have happened as a result of his victory in november. >> what is the political appetite for a temporary cease-fire versus a permanent cease-fire in israel, for example? and also the prospect of hundreds, maybe more palestinian prisoners being released? >> we expect that palestinian prisoners would be released as part of this deal in return for release of the hostages and we are awaiting the actual numbers surrounding that while we look for confirmation from all of the signs at play here but you are exactly right. this is a question of whether it can become a permanent cease-fire after this war has been ongoing since october 8 of 2023. when we consider this notion that it really is about the day

after, what happens if israeli troops leave gaza permanently question mike if the idf pulls out, who is in charge, knowing israel has made it clear they do not want hamas to have control? their goal from the get-go has been the complete eradication of hamas although the realization doesn't seem to have sunken and recently that that is going to be hard to achieve because at the end of the day, it would be trying to defeat an ideology rather than just the fighters themselves so it is a matter of what it will take to get to a permanent stoppage of hostilities. that would really be a second phase of a cease-fire agreement and we have seen this kind of outline constructed in the past and deals we have not yet reached, this notion that you have to begin with some period of time and allow for the exchanging of hostages and prisoners and during the course of that time, however many days, if it is six weeks or longer, try to work out the longer-term solution here. >> kailey leinz and washington, d.c., thank you so much. you're looking at live pictures of tel aviv where it is just

after 7:30 in the evening. turning back to markets now, we are joined by equity strategist at morgan stanley michelle weaver who joins us in studio. we have been talking about the trump trade. are there other things we should be aware of that would be useful to us over the next several weeks? >> absolutely. i think ai was one of the most important themes in 2024 and we have been thinking about how that story could morse in 2025 so in 2024, it was really all about the ai enablers, the companies that were providing the infrastructure for ai, so semiconductors, data centers, industrial companies providing components to the aid of centers, power companies, but when we think about where the story goes in 2025, there is a lot of opportunity within ai agents. >> where does opt the last couple of weeks since jensen huang said it's going to be years before they are useful. >> its really more about

software. if we think about the way companies have been using ai so far, it has largely been about chatbots. you put a question and it gives you an answer. ai agents can do more complex reasoning. ok, here is my list of sales data. go through, find prospects, manage a campaign. he can do much more complex, broad work there. >> give us another theme that is perhaps out of the ai sphere then. >> did mention the incoming administration. i would say the other thing we are watching over the next few weeks is tariffs. that has been a substantial overhang on the market and we have seen that really impact sentiment within the market. when we think about what happened after the 2016 election, you saw a very big, very broad boost to sentiment. when we look at a bunch of different key sentiment metrics in 2016 before the election, the 46th percentile, so about average. they jumped up to the 67% to one month later.

we went from the 32nd percent of only the 34th placental one month later so we saw a much shallower, less broad boost to sentiment and tariffs are one of the key reasons for that and we are really watching to see more messaging around tariffs. >> what happens if we get incremental and marginal tariffs month after month after month, which is, you know, what the administration is floating right now or thinking about? will that have a difference then all the tariffs placed on china or canada or mexico, whatever it may be, and that once? >> absolutely. if it is more stage process, that gives companies more time to think about what they are going to do in that situation. if you are a multinational u.s. company and you have exposure to one region, you can just reroute those goods from the country being tariff to that other region rather than bringing them to the u.s. so were able to manage that risk. if the tariffs come on at once, that is a much different story for companies risk management.

>> is it a little concerning that right now, we have a market that looks like nothing could go wrong, everything is rallying, we are in the green for the year suddenly, but the last few days, it was the absolute opposite story and it looked like a fragile market, a run for the hills market. >> it has all been about yields so far this year. we identified 4.5 on the 10 year is really a key level the market has been reacting to over the past few years. we have seen equity returns exhibiting a negative correlation to yields so that exactly its claims what is going on today. we had a softer cpi print. yields down, equity markets doing great. we are still in a very yield sensitive environment and so that is the key factor we are watching. >> what about the dollar? we have seen a strengthening dollar and it continues to strengthen even when yields are giving back some of the rise. the dollar is up on the index. >> we are really thinking about how that is going to impact the coming earnings season. if we look at what the dixie

did, that was about a 9% increase so we think that companies are really going to be discussing this during their fourth quarter earnings calls. it is not something we are concerned about at the index level. the s&p has 30% foreign revenue exposure so we don't think it is going to be a damper on index level earnings but it could drive dispersion at the single stock level. >> we have to leave it there. fascinating themes out of morgan stanley and that is michelle weaver joining us. >> thank you for having me. >> israel and hamas have agreed to a cease-fire deal, bringing at least a temporary halt to the war in gaza according to people familiar with the situation. the agreement would posit more than 15 months of fighting. we will have more on this throughout the day. stay with us. this is bloomberg. ♪

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>> this is bloomberg markets. i am vonnie quinn. time for our stock of the hour. the u.s. banks reporting earnings this morning including j.p. morgan. it's traders saw a record quarter for fixed income trading in particular and that helped trading revenue overall, up 21%. equity trading revenue was a little bit lower than that. joining us now for more on the banks reporting today is david conrad, analyst at kbw. david, this has set the tone and we obviously have several banks in already. goldman, j.p. morgan, citigroup, for example. can we expect the rest to blow us away as well?

david: i feeldavid: pretty good about bank of america and morgan stanley tomorrow. those are the strong retrievers. what we have seen so far as you mentioned, strong trading and investment banking was up almost 50% year-over-year for jp morgan. you know, i also say jp morgan is fairly asset sensitive so the expectations that the fed won't cut rates quite as much as we originally thought this year, that created a lift and i expect -- that was the same for wells fargo. we think that is a good readthrough for bank of america but may be so when we get to the super regional banks. vonnie: south of the major banks, it is looking good for the more regional banks. it might not be looking so good. what about consolidation for some of those banks? might that be on the client? david: -- on the cards? david: we are seeing a report right now that is so strong. we are a little bit less optimistic for the super regionals. you know, because they have a lot of hedge performance.

we may not see the same and they are most likely the buyers. so we would actually skip down to the smaller banks that will probably enjoy a more of the premium and consolidation phase this coming year. vonnie: let's go through some of the banks we saw today and some of the results. jp morgan did extraordinarily well. it's stock is getting awarded but not by as much as the likes of goldman and citi, for example. the incoming trump administration, it will be a better time for those banks. is there anything that could get in the way of the banks raking in the money over the next few years? david: you mentioned it with your prior guest. tariffs and rates would be what we are really watching. you know, interest rates did back up here which created a little bit of volatility in stocks. both the results and the 10 year and five-year rates coming down today, you know, both worked in concert to bright -- drive out performance but what we have

seen is high-yield credit spreads are down 120 basis points over the last, you know, two or three quarters. that is what we are focused on. if those credit spreads stay tight, we think the capitalets y well but that is our key risk variable. vonnie: how are you looking at jane fraser's turning around at citigroup? it seems to be all guns blazing and she might be pulling back in areas but she seems to be giving presents to investors in other areas in order to make up for that. david: it was a very solid quarter. i think the guide looking into 2025 and 2026 was definitely above expectations. and a lot better than what people feared. i think they pullback our rotc guide from 11% in 2026 to a range of 10% to 11% but keep in mind, you know, consensus was around 9.5 so even the low end of the range can lift estimates

and the 10 to 11 builds a little bit more credibility and more of a stage process that i think the market is more comfortable with. vonnie: david, is it always good for the banks to have volatility or is there any concern that there might be just too much or the wrong kind of volatility depending on what happens between the administration and the federal reserve, if anything, or if new appointees, places like treasury or, for example, at the fdic? david: there definitely is a goldilocks volatility that can be frustrating at times. too little is bad for trading and good for banking but outsized volatility brings a very chalky market and sometimes makes it more challenging for the trading side so you kind of need that bit in the 30 range, plus or minus to really get the best results from both sides of the house. vonnie: we have been about 20 in the last week or two for the most part, we have been just

below 20. curious as to your thoughts on morgan stanley going forward and you said you were positive on bank of america, t. david: thank of america has a really good quarter because it is benefiting some of the asset sensitive names and we are also seeing the deposit come down a little bit better than what we thought and both of those are tailwinds for the bank of america. morgan stanley, we saw it with really strong growth in equities in goldman sachs and morgan stanley and goldman fight for the leadership in the equities position so i think equities result is good for morgan stanley. you know, wells fargo modestly beat the wealth management revenue line item but overall, banking well in equities and should do pretty well. vonnie: if we look at the banks that are little bit smaller, fifth and third command do we anticipate any major moves

between any of these banks? david: i think there are going to be positive results. keycorp is unique because they have investment from nova scotia bank. they are restructuring their balance sheet so expect a pretty good lift there. they do have a regional investment bank. we expect them to enjoy some of these benefits at a much lower rate that we see for the money center banks. when you look to the rest of the super regionals, it's going to be good. we would expect a little bit more positive optimism from the nii perspective. the issue is i don't think it will be quite is good as what we are seeing today. positive trends, maybe a little bit more subdued, and then the group does have an overhang of acquisition risk overall. vonnie: thank you so much for your time today. a big day for the banks. david conrad at kbw.

we are monitoring. israel and hamas have agreed to a cease-fire deal, bringing at least a temporary halt to the war in gaza and this is according to people million with the situation. the agreement posits more than 15 months of fighting and you are looking at live pictures of gaza where it is just after 7:30 p.m. in the evening. we have more on this throughout the day. this is bloomberg. ♪

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>> this is bloomberg markets. i am vonnie quinn. let's take a quick look of these markets now because we are seeing a major rally on our hands, bringing us back into the green for the year. it really put the gun under these markets once again so we have for example the nasdaq 100 up 2% at this point. we have the s&p 500 up 1.6% and the dollar index still strong. it is about 109 but it is off its high points of the era.

and then in terms of energy, we have wti rising. it is about 78 and change but natural gas is about four dollars as well. the major move came in treasuries where we saw a giveback of many of those basis points that have been put on following the jobs data and as markets reprice their expectations for fed interest rate cuts this year, if you take a look at the two year yield, you will see it gave back nine basis points. when it comes to the 10 year yield, it gave back more than 15 basis points and it is now at 4.66% and we are actually seeing the market reprice the whole year so we have been pricing only one cut and not towards october probably at the earliest. now, that cut may come in july according to these markets but we have seen how quickly they reprice and let's get back to the breaking news now. this is according to people familiar with the matter. israel and hamas have agreed to a cease-fire according to them,

bringing what would be at least a temporary halt to the war in gaza which of course has been ongoing now for 15 months since october 8 of 2023 after the awful attack on october 7. mike shepard now joins us, senior editor in washington, d.c. mike sheppard, very briefly, what kind of conditions are we anticipating? mike: we are expecting the release of some of the remaining hostages. it it is unclear who is left and who survived. we are respecting a positive hostilities between hamas and israel that have gone on for 15 months since hamas invaded israel on october 7, 2023. it is important to note that hamas has been designated a terror organization by the u.s. and european union and we are waiting to hear more details and a formal announcement. vonnie: these are live pictures from gaza and palestine where it is 8:00 p.m.

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>> from the world of politics to the world of business, this is balance of power. live from washington, d.c. >> a cease-fire deal in the middle east announced just hours before joe biden's farewell

address. welcome to the fastest show and products as negotiators announced a breakthrough. the question is which ones? i am joe mathieu alongside kailey leinz in washington. thanks for being with us on the wednesday edition of balance of power as we bring you political coverage from the nation's capital and this is remarkable timing here knowing the biden administration has been working on a cease-fire. they told us at bloomberg that we are on the brink of a deal but now, do trump is also taking credit for this news. kailey: taking to true social, describing an epic cease-fire agreement would never have happened had he not been elected in november. regardless of whether or not that is true, his incoming administration has been working in tandem with the biden administration on this effort. obviously, this is the result of what has been months and months of effort in which we have seen multiple head fakes. we had reporting that we have been close to a deal before only for no agreement to result and we have