Higher. The nasdaq is up. 7 . Quite a turnaround from earlier this morning. 33. S p 500 at 29 the 10 year backup of 70 basis points. 24. 44. L trading at lets get a deeper dive into the Market Action with taylor riggs. Taylor mostly and improving picture across the screen. We were in much worse territory at least on the russell 2000, nasdaq, so we are starting to improve, go into positive territory. 2000 and raising a lot of those gains but still off. 1 . Take a look at the nasdaq biotech sector. Big outperforming today, up 3. 5 . Biotech is leading the way in thisbiotech is leading the way n this pandemic, in terms of finding a treatment and vaccine, so you are seeing that outperform. Gilead, their remdesivir product is hitting hospitals to treat covid patients. The u. S. Will get about less than half of the 1. 5 million vials being given out in the next week or so. Taking a look at the yield picture, you have a lot of treasury supplies coming online. Treasuries rising and you are getting a steepening of the curve. The Banking Sector is still lacking. Citigroup, bank of america, jp morgan. It is the lessconsumer facing banks that are down less than 1 today. I think this has to do about the consumer picture that we are facing with banks. Vonnie thank you for that. Much appreciated. March exploded the basic tenet of bonds, strategies posting their worst returns since 2008. Some investors are seeking an answer and private alternative assets. Joining us now with her view on private credit is susan kasser, go head of private credit at neuberger berman. Progress of the private credit markets, from where we had all of those dislocations in march, two now. What have you seen . Susan thank you for having me. Initially, the most attractive opportunity was to move from a truly structured private credit and take advantage of the selloff in the market. Focusedortunity exclusively on the highest quality companies, noncovid care,d, software, health that opportunity has closed for now but it was a very attractive opportunity when markets were at their lows. Vonnie if that is the case, what happens now, where are the opportunities . You say be patient, but how many months is patient . Susan that is one of the beauties of the private market. Inestors in trust managers that arena with longterm locked up capital with multiyour investment periods. They expect you to take your time and to be tactical and patient. Most private that is used for lbo activity. To a trickle at the moment, not gone, but definitely down. Private equity firms have the benefit of time, five years of investment on average, and is sitting on 450 billion of dry powder. When they come back to new activity, that will generate significant opportunity for private that investors to invest. Vonnie what kind of industries and companies are we talking about . It is pretty few and far between the industries that will come out of this better. Susan thats a good point. The new lbos we are seeing now are around software, particularly around infrastructure, health care payments, erp software in particular. We also see companies that actually helps consumers and businesses address the challenges of reopening. Remember, in private debt markets, we are talking about companies that could be quite large, 8 billion in revenue, or they could be quite small, 100 million in revenue. There is a tremendous opportunity set. The idea here is to use your ability to be selective over time to cherry pick interesting companies. Companiessee 10 trying to help supermarkets address safety for their consumers going forward. That doesnt mean that all 10 of them will be equally interesting opportunities. The dry powder, you say 450 billion. Where did that come from, given so much value was destroyed . Susan one of the benefits also about private markets, private equity and private debt, is the benefit and the cost of illiquidity. Investors are entrusting managers with longterm lockup vehicles. Managers are making illiquid investments. Although there is valuation, there is not the kind of mark to market volatility you see in the public markets. So you do not see the kind of overreaction to the up or down that you would see in public markets. There are many reasons that investors, pension funds, insurance companies, High Net Worth individuals, endowments are interested in alternatives. Many of them is the premium for the complexity in liquidity, but also having part of your investment in a portfolio that downss subject to ups and. Vonnie the new issues are coming to market. You specifically say that you dont want anything covid exposed. Why not . Would you not get better rewarded for those companies . If the death toll, hospitalizations are going down, and at some point, there would be a vaccine, is that not a place to be for five years . Susan excellent question. It is important to focus on what a particular fund has communicated to their investors as far as risk and return tolerance. Buyrly, opportunities to what we believe are covidresilient in the market at a point of time of significant dislocation in early march, that is attractive with adjusted returns. It may be lower returns but also lower risk. Other investors are happy to take on a bit buy risk. Cherry picking through possible covidexposed companies that consumer,value to the a fortress Balance Sheet with liquidity, and can withstand cash flow for two years, and that is certainly an interesting opportunity. That is a very exciting opportunity for some investors. But it is important to segregate risk return tolerance by investors based on the communication you have with them when you raise these vehicles. Vonnie fascinating conversation. We will not to talk to you again soon. Susan kasser, cohead of private credit at neuberger berman. Lets bring you some headlines out of new york city. New york city had four times a number of vets as expected during the covid19 outbreak, according to a new study, including thousands of other debts that may not be attributed directly to the coronavirus, but its a fax on Health Care System , city services, and other factors. It takes into account march 11 through may 2. During that time, a total of 32,107 debts, 24,000 more than the city would have expected. Deathsly, 5293 excess may have come from other causes. That is a story that we will continue to dig into throughout the day. Lets get a check on the other first word in mind. The white house is recommending all nursing home residents and the tested for the coronavirus in the next two weeks. The white house says it will help states that need it. Nursing homes and the elderly have shown to be especially susceptible to the virus. In italy come the number of new Coronavirus Infections has declined for the fifth straight day. The country where europes outbreak began now has 219,000 cases. More than 30,000 people have died, one of the highest death tolls in the world. Last week, officials in italy began to ease lockdowns gradually. Is upjohnsons government with a roadmap for recovery from the coronavirus. It calls for britons to wear face coverings in enclosed spaces and says they should prepare for the new normal to last a year or more. People are being urged to continue to work from home. Outi arabia is cutting oil to the lowest in 18 years. , their plan to pump 17. 5 billion barrels a day. That is a Million Barrels less than the official target and the latest opecplus agreement. The saudis are hoping to prop up a recovery in global markets. Global news 24 hours a day, onair, and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im Mark Crumpton. This is bloomberg. Vonnie this is bloomberg markets. Im vonnie quinn. Automakers have seen the sales drop drastically as people shelter in place. Alix steel spoke to the autonation ceo earlier about how the industry is performing. Business was cut in half with shelter in place, sales down 50 . We had to take action to protect the company to see us through the crisis, we had to furlough 7000 associates, almost 30 of the company. But we were deemed essential everywhere we operated. If you think about it, we are. All the doctors, nurses, firemen, if they had difficulty with their vehicle, it had to be fixed. Then a drum beat from customers, and this is what they said. They want a safe environment within which to do business, and we have extensive protocols for that. Wantso, they said they personal space in mobility. They want their own personal cars where they decide who is in and they control the safety of that environment. We see an automotive recovery that is underway. Sales have developed from 50 down to 20 down by the end of april going into may. There is pentup demand. The customersom for personal safety. Financing is available and cheap, contrary to the great recession. And we need the plants to restart. We need more inventory than we have at the moment. I fully support the reopening of plants. Elon musk should be able to reopen the tesla plant in San Francisco. I dont understand how you can fly a plane from new york to San Francisco but cannot open up a plant with 30 of the workforce. The automotive recovery is underway. And im glad that you brought up inventory. Recovery starts, as your company sees better sales, where are your holes . Side, no new vehicle doubt, pickup trucks. Rike, which stirke reduced vehicle availability, and then the shutdown. Bestp trucks performed the through this whole disruptive period, down only like 10 . If they can restart the pickup first nts [indiscernible] the point is, America Needs to gradually, safely resume economic activity. Im glad that you mention that you would be the first in line, give me all of your trucks. How does that shortfall in supply effect inventory and pricing . Expectation for personal mobility and safety is the number one priority. We canont have it new, offer them something preowned. At the moment, very flexible, willing to change. Availability on the preowned side is very good. But you cannot leave these when you have an automotive recovery that is underway. There will be twists and turns, surprises in 2020. Should beby 2021, it a good year for automotives. Vonnie that was the automotive nation ceo. Mike pence is back at the white ,ouse after isolating discovering that a staffer tested positive for covid19. Reporting andty alert on the bloomberg, that it has 24,172 excess deaths as the outbreak accelerated. This is happening as new york city mayor de blasio says the city is likely to continue its lockdown until june. Futures new york states is being outlined by governor cuomo. As soon as friday, he plans a regional opening of the state, focusing on Industries Like landscaping and construction. That he cuomo saying will be guided by the science, looking at the lowering of new infections and death rates. In russia, where cases and new infections have been rising, Vladimir Putin deciding to lift the national restrictions, ending them, and leaving the decisions up to regional leaders. Prime minister Boris Johnson as well outlined the plan for that nation as they leave lockdown. He says in phases. That means continued social distancing, as well as wearing face masks. He is trying to get people back to work but safely, and he is encountering pushback from labour unions and leaders. Shops could reopen next month in has, pubsss macys attracted investment. Was struggling before the coronavirus but because of covid19, many of the brickandmortar Retail Stores are still closed. Seeking mores is sources of financing. Retailers,aking of we appreciate that. We will be watching for more with the announcement of the openings. That is our coronavirus update. This is bloomberg. The Johns HopkinsBloomberg School of Public Health is launching a free getne Training Program to volunteers. Nyenswah is part of the school of Public Health. Thank you for joining. Explain how it will work, how he will convince people who enjoy their liberties to be a part of the Contact Tracing program. Thank you for having me. Covid19reat program, Contact Tracing, highlights how tracing is a key component of Health Strategies to slow down covid19. Contact tracing is not a new Public Health tool, its been around for a long time, including with ebola. Stopis intended to secondgeneration of covid cases. During the outbreak ebola, one of the important tools was Contact Tracing. Vonnie you will need approximately 100,000 tracers. How will you convince people to take part in the program, to willingly engage . Tolbert the reason it is important, this is a serious way this is the, and way Contact Tracing was done in west africa and around the world with ebola. 100 of people coming into contact with covid19 need to be traced. It is an online tool that we developed with john Hopkins Bloomberg school of Public Health. We feel strongly that this is a way forward in combination with social distancing. Contact tracing has been very effective. Vonnie one of the concerns is between a lag time diagnosis and having the disease and being able to pass it along. Is good and effective Contact Tracing, if you have already been in 14 different areas, had contact with 10,000 people, and then you test positive. Why Contact Tracing is important to combating covid19, number one, we want to find who thosecases, know contacts are, investigate them, make sure we are tracing their contacts. Clear,ng i should make one less contact can keep this virus going. With theortant, phones,cation of mobile people can be tracked. We can accelerate Contact Tracing. We did it in west africa, liberia. We were able to train vonnie im sorry to cut you off but we have to leave it there. Johns hopkins is affiliated with bloomberg. Mark im Mark Crumpton with bloomberg first word news. British Prime MinisterBoris Johnson has unveiled his plans to reopen the country. He told the house of commons today restrictions will ease in phases. The first step will take effect this wednesday, including a return of work are those who cannot return work from home. He warned the u. K. Is not yet out of the woods. Begun our dissent from the peak of the epidemic, but our journey has reached the most perilous moment, where a wrong move could be disastrous. At this stage, we can have no further than to announce the first modification of our measures. The plan also calls for people to wear face coverings in urgeded spaces, and he and britons to prepare for things to last for a year or more. Statistics show traffic jams on germanys highways doubled last weekend from a week earlier. Congestion in london and madrid is also on the rise. Nations are slowly lifting restrictions that have been in place since march. Officials think many use the weekend to visit family that they have not seen in months. New york citys lockdown is likely to continue until june. The state has been in lockdown since march. Governor andrew cuomo has said some regions of the state will be able to reopen beginning may but that will likely not but that will likely not include hardhit new york city. Iran reported 45 deaths from the coronavirus in the past 24 hours. The total number of fatalities is now more than six he 600. Iran also saw 1700 new cases locked beingpite a reimposed in large areas of the country last week. Health Officials Say the rate of new infections is alarmingly high in tehran. Global news 24 hours a day, onair, and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im Mark Crumpton. This is bloomberg. Amanda im amanda lang in toronto. Welcome to bloomberg markets. Shery im shery ahn in new york. We are joined by our bloomberg and Bnn Bloomberg audiences. Here are the top stories we are following from around the world. U. S. Stocks wiping out early losses with the s p 500 now on track for a third consecutive day of gains. Health care and tech leading the way as the index rises to its highest level so far this month. President trump pushing to reopen the economy, even as the administration battles a coronavirus outbreak at the white house. Vice president pences press secretary confirmed positive for the virus. Saudi arabia announces a oilrise move to slash output to the lowest in 18 years. The kingdom is cutting production by another one Million Barrels a day, on top of what it already promised opec allies. Lets get a check on the markets. We have seen a bit of a turnaround, including the effect of oil. What had been a move higher, we see a leg down. Energy actually weighing on the s p 500. Showinghat market, tech some leadership, health care as well. A record high, helping to power that nasdaq higher. Jpmorgan and citigroup both trading lower today. The big question still remains around the path to reopening, at what pace we heard that new york would open up as soon as friday. Those are the kinds of questions that investors are trying to parse through. Is that the right approach . Wendy hartman is with Buckingham Strategic Wealth. Ofm curious for your view just how much investors can and should parse out the daytoday moves of the pandemic, the Health Crisis, and the openings, as they try to make decisions around investing. Wendy thank you for having me today. Ts an interesting question from an investors point of view, it is difficult to predict. With a Health Crisis that has turned into a financial crisis. Forecasting, knowing what will be ahead is a challenge. We are continuing to see headlines each day that help give guidance. Fridays unemployment rate, while that was a dramatic headline, still better than expected. We saw a green day in the market based on that headline. There are headlines coming out even continued this week. Retail sales coming out on friday. As Companies Continue to report, we will get insight as to how investors think about it shery . We have seen the market being supported by big tex, pharma. Could we see a change in leadership in the markets, given the reopening happening now, perhaps a boost to hospitality and travel industries that have been really badly battered by this pandemic . Wendy sure. To share some perspective of that, we saw earnings coming out today. , butinly under expected living through this Health Crisis and a pandemic, as we look ahead, there could be pentup demand, but it will all depend on how americans are feeling about travel, how safe it will be. There could be a pentup demand. Hotel, travel, leisure is an important part of the economy. As people feel safe to hit the roads, the air, the impact that will have. Amanda where do you come down for clients on fixed income . There will be some support from fed activity and in the fixed income markets, but is it just risk aversion . To provide some perspective, we really looked at the fixed income portions of the portfolio to dampen in the risks. We use words such as the bedrock of the portfolio. We are not necessarily looking to the bond part of that, more to the equity side, to bolster those portfolios. We have seen the Federal Reserve intervened with fiscal policy, keeping rates low. Rates could be low as we navigate our way out of this. At a time whenly we could see even more conflict with china, could we see these uncertainties pressuring rates . Not only you expecting the Health Issues but also the geopolitical problems to have an impact most in the market . Its a really interesting question, and an interesting perspective. When we think about interest rates, where it could go into the future, trying to look ahead from those points of view, i think there are a lot of data points, other things that will be coming on the horizon. Coming out onan wednesday to talk about the Current Issues hitting the economy. In terms of a deal, look at it, all different countries, from that perspective, that will help to give us the data points to think about it from a global perspective. Shery we look forward to the fed chairs announcement. Thank you so much. Wendy hartman, Buckingham Strategic Wealth president. Coming up, and interview with gary kelly. Discussing recovery of demand and consolidation in the industry. This is bloomberg. Shery this is bloomberg markets. Im shery ahn in new york. One move today that drew investors attention was saudi arabia surprise announcement to slash output to the lowest in 18 years. The kingdom is trying to spur the country from an Energy Crisis that has devastated its finances. Joining us now is catherine nye. Really incredible the turnaround we have seen in the last two months, going from a price war, to voluntary cuts. Absolutely. Thanks for having me. If you remember the beginning of march, this is when the opec deal fell apart. Over the weekend, we went from 50 oil down to 30 on monday. Now we have everyone going from, are we going to cut, to let me cut over and beyond. One piece of the puzzle will be the demand side of this. We dont know how long it will take to get back to the precrisis levels. Your sense of what the expectations are among opec, opecplus members . There has been a big debate. Oil traders are looking at a couple months to a year. As economies restart, there are fears that we will never get back to that level again, and that is concerning. On the face of it, diminishing supply and natural declines because of the way Natural Cycles work, economic cuts. Willxpectation that demand return is definitely a fear. We see this even today after the quick bounce back in oil where we are trending lower again. A market is still cautious in terms of whether we will see that rebalancing that everyone is calling for. Shery we will see wti june futures expiring next week. Will we see a repeat of what we saw in may . Catherine that is the billion dollar question right now. A lot of the passive money, the etfs that were stuck in the past month, indices, those are no longer in the front of the curve. A lot more restrictions by brokerages and banks to make sure that people who are not professionals should not be up front. Theoretically, that should mean less chaos. Watches, there should be more of a process. This is kind of a wild world in oil like now, uncertainty with the next blow by the coronavirus, anything is possible. Great to have your view on this, catherine ngai. As the economy gradually opens up, driving the demand for oil, we also expect airlines to return to something resembling normal. How long might that take . Bloomberg exclusively spoke to the southwest ceo, gary kelly. Demand is still very, very modest. We are seeing gradual improvements in air traffic. Our load factor last week was probably around 20 , at best. At least on southwest, we are not looking our airplanes full anyway, to allow for physical distancing. You will not see a full airplane. The good news is, we are beginning to see a recovery. Our government has asked us to remain open for business throughout, so we never shut down, but we have reduced a lot of our flights. We are working with the government to hopefully implement temperature screenings, so that we dont have ill passengers getting onto , airplanes, a number of cleaning procedures we have implemented. Hand sanitizer is available. We are asking employees and customers to wear masks. Air filters on board creating hospitalquality air. It is a multilayered approach to make the environment as safe as we can make it. 20s isfactors in the not ultimately sustainable. How long do you think it will take to get load factors back up of survival . Do you think that some routes will not be viable with these sales . Gary because we are in a recession, we will have to see a very gradual return of business traffic. That is very typical in a recessionary environment, exactly what we have got. Talking about International Travel earlier. International travel will also be slow to return. I think it will be years before we get back to 2019 traffic levels. Consumer,f the historically, in recessions, consumers travel, they watch their budgets. They will be looking for low fares. Lowfare carriers, like southwest, will see more demand in an environment like this. Overall, it will take several years for the traffic to recover. All of your preparation seem things coming back five years down the road. That, ifes longer than there are too many airplane seats looking for too few customers, is there a round of consolidation that takes place . What is the Tipping Point for you to consider Something Like that . Gary again, all of that is premature. We are just making sure we keep southwest healthy and we survive this crisis. How long it takes to survive is the essence of your question. We will need to not just survive but then thrive , are all open. Airways in airtran 2010, so it is something that we are willing and able to do. That is not the preferred course at this point. You make an excellent point. In this kind of environment, if in fact travel demand is lower, there will could be some consolidation. If so, we want to be prepared for that. Right now, we are doing everything we can to minimize our spending, focus on safety, focus on health, and make sure we have plenty of cash. We have done all of those things. Was gary kelly, Southwest Airlines chairman and ceo. California takes on the gig economy in a crackdown on uber and lyft. A will talk to the leader of Client Services organization. This is bloomberg. Erg. Amanda live from toronto, im amanda lang. Were hit with a lawsuit in california over the treatment of their workers. Thes an ongoing thing with classification of their workers, whether their employees are employees are contract staff. John chaney is the ceo of professional Staffing Services firm. This is a story that many of us have watched. Not only will it directly affect these companies heavily but it has repercussions across the gig economy. Could this be a game changer . Yes, very much so. Economy is the fastestgrowing segment in the u. S. Right now, now 10 million workers out of the 150 million workers in the u. S. , so very significant. Unfortunately, the way Gig Economy Companies have organized themselves, they have all invaded u. S. Labor laws, shirked responsibility to their workers. This is an important step for the united states, americans to reassert whether or not worker norms that we have had in our country for the last 100 years, whether we want to have them or see them slowly euros. ,t is a very important case important for america, has very big ramifications. Shery we have seen california implement ab5. What are your thoughts on having such legislation to be able to regulate this industry . Ab5 is a very good law. ,ig economy companies, uber lyft misclassified their workers, refused to pay taxes on labor laws. As a result, california passed a law specifically to include them. Uber reviews to follow this law. Now it takes the attorney general to sue them to enforce these laws. Payment minimum wage, overtime, does not pay for workers comp. , they dont pay into unemployment insurance, payroll taxes, sick days. This is a horrible thing for the workers, who dont get these benefits, but it is also an unfair competitive advantage for anyone that competes against these gig companies. It doesnt you have to be ubero r lyft. A 15ular company will have to 20 cost disadvantage against any of these gay companies. The law is good for to the viewer reasons. It protects the workers as they should be protected, and all americans have expected for the years. It also creates a level Playing Field. They Gig Economy Companies have a big advantage over everyone else. We should note, this is too. Sue in canada, it is not as though protections for employees are not on the books. Our employee laws are very strong, as are in the u. S. , but you have to agree youre talking about employees. Once we make that change, we can agree, the cost for these businesses may go up. They may have to charge more for their products. There is a whole knock on effect that will affect other people. Do we need to concern ourselves with that, or should the policymakers be looking at just protecting the workers . No, we need an equal Playing Field for workers and companies. Right now, they get a subsidy by taxpayers by not having these laws apply to them. Right now, their prices are unnecessarily low. That is unfair for the workers who do not get paid enough, unfair for the competitors have to pay these taxes. They have to come up to the same Playing Field as everyone else. Great businesses are able to pay their workers decently and give value to customers. When i think of a starbucks or walmart or mcdonalds, i think of companies that have workers, but they are able to at least follow labor laws and pay these workers a fair wage. At the same time, give customers great value. Are unable to do that. These are smart folks, they can put their wits together to be able to come out with value for customers, as well as a reasonable wage for their employees. Shery will the gig economy grow after covid19 with all the people losing jobs right now . So many people. Will,i believe it especially if they cover their employees and treat them fairly. The biggest threat to the gig economy is actually a Conscious Consumers saying, i dont want Gig Economy Companies because they dont treat their workers well. If they solve this problem, they will grow. There are also a lot of places where you could use gig economy workers for source work, not just through delivery. Shery we are out of time, but thank you for joining us, john chuang. From new york and toronto, this is bloomberg. W . W . Uhiono scarlet fu. Romaine im romaine bostick. Monday have closed on morning, may 11, the rally continuing today. On pen significantly lower all of the major indices, the s p 500 at one point was down almost 1 . It has bounced back in a pretty to ce way here, continuing creep ever so higher, up. 3 of a percent. Were seeing seeing a a lot of gains led by the healthcare sector. Cardinal health and a few other in that space moving significantly higher and seeing the s sales force and downside, its mainly from the aterials companies and the financials like j. P. Morgan, citizens and citigroup. Biotechs having a real interesting day here. News completely unrelated to a special fed