Transcripts For BLOOMBERG Bloomberg Markets 20161111

The nasdaq has been turning better today. Its been bouncing back. And the s p 500 were still sealing a little bit of decline for that average. Lets look at this push and pull were seeing in todays session. As some of the attention shifts back to individual corporate news. Invideo coming back, the Strong Demand for the core offers and new markets to shares with that huge gainer trading at a record today. Disney are also gaining because earnings missed estimates but the company is forecasting that growth is going to be reinvigorated going into next year and beyond. It despite something of a shortfall at espn. Apple shares, not rising that much because of their size. One of the biggest index point contributors today. On the down side on the flip should, withholding back the s p 500 in particular are stocks like exxonmobil, following along with oil prices today. Facebook continuing to show weakness in technology. And pfizer as well. They have had a roller coaster this week. They had two big up days. The company today saying its considering speg assets from its established drug business. Thats what were seeing today. Talk about the week a little more. The s p 500 in terms of its weekly performance, a big up week. 3. 6 . Of correspond a lot of that gain come of course a loft that gain coming on wednesday and thursday. But a lot on wednesday alone in the wake of the president ial election. And its result. As scarlett mentioned, the next cab peso has been in focus mexican peso has been in focus as well. This is the dollar versus the pesos, up 10 over that time. That is the biggest drop for the peso against the dollar in a week going back to 2008. As this election is perceived as being negativive for next cow. Its also manifested itself in mexican stock. You can look at the mexican benchmark index, it is down 3 1 2 this week. There are also a number of Mexican Companies that trade in the United States. You got group televisa. The cement company cemex. That in stark contrast to the many Building Materials and construction firms that went up in the u. S. And Cocacola Femsa down 13 . Scarlett thank you so much with the markets. A check on the bloomberg first headlines this afternoon. Mark has those. Mark thank you. Vice president elect mike pence is now leading Donald Trumps Transition Team. He replaces Chris Christie, two of his former aides found guilty last week in that bridgegate scandal. The story based on a report in the new york sometimes citing sources close to the team. President leekt trimp reportedly wants to use pens washington experience to move the process along. An executive committee, which will include members of congress, will advise pence. Repealing the Affordable Care act is the top priority for republican voters. Thats according to a new Morning Consult post election poll. 74 of republicans say they want president leekt trump to rescind the law once he takes office. Building the wall, mr. Trumps Signature Campaign issue, is the lowest priority for voters. For his final time in office, president obama led the nation in observing veterans day. The president laid a wreath at the too many of the unknowns at Arlington National cemetery. In his remarks mr. Obama said of those who have served and are serving in the u. S. Armed forces, quote, we owe you our thanks, our respect, and we owe you our freedom. Russia could be on the verge of creating its own internet, independent from the worldwide web. Thats according to the countrys Communication Ministry which says the kremlin mike make the move to tighten control over cross border data exchanges. The ministrys pln also calls for regulating domains, i. P. Addresses, and points of traffic exchange. Global news 24 hours a day, powered by more than 2,600 journalists and analysts in over 120 countries. Im mark crumpton, this is bloomberg. Scarlett thank you so much, mark. Earning season is winding down. One big name were watching is jcpenney. The Department Store chain cut its forecast for sales this year to as little as 1 growth from a previous estimate of up to 4 . The forecast highlights the struggles that c. E. O. Faces in trying to rebuild the standing. Earlier on bloomberg markets, the head Much Research spoke about penny sales shortfall. Sales growth as you know are down. 8 for the quarter. Some of that had to do with weak afairly sales which is not what you want to see. Some of that had to do with disruption related to rolling out 500 or roughly half of its stores with appliances. Which is part of a multiprong strategy for them to turn around her sales. Talking about this turn around. I want to look at bloomberg. This is the same store sales chart going back to 2011. This captures the big declines that the company had seen in same store sales. And then the journey since then which has been sort of rocky, right . What do you think jcpenney now needs to do to get the momentum going a little bit more strongly . They are focused on three strategies. Most all big box retailers are focused on now and need to be, they are also focused on their private label, which has differentiated them in the past. Its roughly with exclusive stuff 54 of their sales. And they are looking to take that up to 70 . As they make that march forward, it will help their gross profit margins. Its the product for their customer. Just as revenue per customer, that comes with initiatives as onlynn r to it as buy and pick up in the store which went live in august of this year. There is high attachment rates associated with that as consumers come in to pick up their product. It goes from there. But thats the core. Often retailers, Department Store retailers, theyll use anything as an excuse to tell us they are having a tricky time whether its the weather or whatever. We had an election this week. We now have a new president elect. What does that tell us about what does that mean for future spending patterns . Its always difficult to assess that except to say i believe its about consumer onfidence. Thats yet to be seen. Its also about what they have in their pocket. Last year we had lower gasoline prices at the pump and probably helped on the margin for consumer spending. If there are lower taxes for the average american perspectively, which is j. C. P. Target, targeted customer, that certainly would be helpful. If there are Lower Health Care costs for consumers, perhaps that will be helpful, too. Very early to tell, but i think those are two factors which could play into a consumer that continues to respond as it had in 2015. What are we to take away from this from macys, nordstrom, about the Holiday Season . Can these retailers get through the Holiday Season without heavy discounting . Its absolutely going to be an intense, competitive environment. There is no way around it. I think what does help, though, for retailers, a couple of things. One, inventories, as you well heard, are very much in line. There are some competitors of jcpenney that are reduced their inventories, kohls being the most notable down about 9 year over year. Macys has well controlled their inventories and reduced them. The list goes on. That puts less of a promotional potential for the quarter. Also last year, weather is unpredictable. It could just be its warm this year as last, the good news is that youre comeping against an easier year. The final point which on the margin i think adds some modicum of value there are two extra spending days this year, 28 versus 26. One of which is a saturday. Quickly as well. Amazon has renewed its push and strengthened its push into apparel specifically. For many these Department Stores, how much of an issue is that going to be . Amazon has already taken a decent chunk of their business in other areas. The buzz is to be unamazonable. I think it does play to jcpenneys priorities to increase their private label product away from branded. I think it would give them a differentiating point. Amazon is truly a major competitor. There is no way around it. They can show some skews that are different than the macys and kohls and jcpenneys of the word. Lower price points, different skew, and it will attract a customer and gain market share. The thing in jcpenneys case they are differentiate because of the private label they continue to focus on. Scarlett that was stephen, head of research at r. P. Press. He was speaking earlier. Coming up, buying the mexican peso when its down makes sense. Well get the insight on the wild week that was on the f. X. Market. Scarlett this is bloomberg markets, its time for the Bloomberg Business flash. A look at some of the biggest business stories. Kenneth cole is closing almost all of its retail stores. So they can focus on ecommerce and international markets. Kenneth cole has about 63 stores, most outlets. Some of the worlds top trading firms have agreed to build a faster Data Transmission network between chicago and tokyo. Thats according to a person familiar with the matter. The move would accelerate trading between two of the Major Centers of finance. The joint venture is dubbed go west. Plans call to comprise existing towers and lines under undersea ables. Lets turn to the world of currencies as this wild week starts to wind out. Global investors had quite the week tracking all the winters and losers. One notable big leezer is the mexican faceo. It tumbled far and fast after trumps win. Yet the peso is still a winner. The mexican peso is a great opportunity because the volatility is incredible. If you can catch it at a low level, you can probably make a loft money speculating on the curncy. Scarlett here now to discuss this weeks action in currencies is vin. Hes a strategist who writes for bloomberg and had decades of experience. The peso has been volatile but what its been doing is weakening. Vin within the trend its been spurts of 50 to 70 big figures where its gone up, come back down. I think mark is referring to, what im sure, if you catch those that flow, and you can ride it up to 70 big figures, its great trading. Scarlett and it was pointed out. If you come inside the bloomberg and look how the mexico peso has been trading. Clearly when the line goes up, it means the dollar strengthening. If you max it out, you can see that for the most part this is a trend thats been going on for decades. Since 1971. Even if you go to the last five years we have seen the peso weaken. How much of this is really due to Donald Trumps protectionist rhetoric versus the fundamentals. Vin what youre seeing from the trump effect has maybe the last 300 to 400 points. Underneath that is, as you say, the fimentsfuments arent there. This is the trend. Even even positive news that would come out if trump said no wall and things of that nature, you clearl trade back down probably to about the 1750, 1800 level. Im not sure we go lower. Scarlett taking us back to where we were in march or something. Shouldnt the weak currency help mexican economy . Shouldnt we start to see that show up in the trade numbers . Vin it depends. If the currency weakens too quickly, whats likely to happen and what is expected to happen next week is the central bank will raise rates. The people that i have spoken to, the smart money is saying 50 basis points is built in. If they only raise by 50 basis points well see the currency weaken more. Buying power locally is being taken away. It takes a while for the currency effect to wind its way into the economy. As you have seen with brexit its not instantaneous. Between now and then the economy will suffer. Scarlett speaking of brexit, one of the big winners this week, or since trumps victory on tuesday night, was the british pound. Soaring against the euro. I think its the best week in a couple years, right . What accounts for that . Is that just a kneejerk reaction following people having to readjust their positions . Or is there reason to believe vin its a byproduct of the eurothan the pound. The ear row is feeling the weight of the weight of the political risk. When you see talk of Infrastructure Spending in the u. S. That raises the spotlight of one not federate hike but possibly multiple heights. While you have an e. C. B. Easing next month possibly. When you see a may win, trump win, a populist vote, this tide is rising. You have french elections next year, german, the antieurois leading. You also have an italian referendum coming up where novote could see the end. There is a lot of political weight as well as the monetarypolicy. Thats leading to that cross selling. Scarlett you talk about the political risks. You laid out what the fed may or may not do next month when it meets. To what extent would the fed need to consider things like the italian referendum when it meets next month . Up until now its been very data focused. If anything the inflation metrics out there suggest that the fed should raise rates and consider raising rates more in 2017. Does it need to pause . Or at least be more curbs in its cautious in its approach because of the political land mines . Vin theyll be aware of the italian referendum for sure. I think this time domestic policy will super seed any important pressure. Nless super seed supercede any important pressure. Its not going tonight mexican 35euso scenario. That wont slow the fed. Scarlett thank you so much. Still ahead, the u. F. C. Making its new york city debut this weekend. Connor mcgregor challenges Eddie Alvarez. Well talk with the chief operating officer. Scarlett this is bloomberg markets. Mashweekend one of biggest arts stars will be headlining the u. F. C. Debut at Madison Square garden. Were talking about connor mcgregor. Hell fight Eddie Alvarez tomorrow night at the queard. This will be the u. F. C. Trip to new york since a ban on the martial arts was lifted earlier this year. Joining us now is lawrence epstein. Thanks for coming in. In new york take it took the u. F. C. Anywhere from eight years to some people say 19 years to become a reality. Can you give us a ballpark figure of just how much it costs . It cost us several Million Dollars in outofpocket cost, but cost us millions of dollars in time for Senior Executives like me and other members of our team to get this thing done. We worked on this protect for about a decade. Couldnt be more excited to finally see it be a success. We got our big event this weekend. Scarlett culminates on saturday night. When you factor in everything, gate receipts, media exposure, qualify for us what this first ever new york city fight means for the u. F. C. . First of all its the biggest event well do. Our gate will be in excess of 17 million. Biggest we have done has been around 11 million or 12 million. Thats an unbelievable number for us. Payperview will be our biggest event of all time. All the metrics indicates that. There is this brand enhancement well get out that we couldnt get in any other city in the world. New york is one of the biggest cities in the u. S. , but its also one of the most important cities in the world. The reverberations from this event will literally be heard around the world. This fight will be seen in about 1. Billion homes around the world. About 150 different countries. Its going to be a big brand statement for the u. F. C. And our athletes. Scarlett give us a sense of the u. F. C. Fan base. Who is your diehard fan . Who is your fast yet growing fan . Our diehard fan base is that 18 to 34yearold male. Its changing a lot with the add van hollen of athletes like rhonda rousey, you have a lot of women coming into the sport and enjoying t as far as the individual graphics, the africanamerican demo is growing quickly. Faster than the rest of our fan base. As is our hispanic market. The great thing about the u. F. C. Is not just u. S. Story, its a global story. We look at marks like brazil or ireland where mcgregor is from or the u. K. , there are a bunch of different stories out there showing were growing there. Scarlett are you planning to stage fights there . Were going to do 42 events this year, and 42 next year. 25 will be in the u. S. The remainder will be in places like i just mentioned, london, exland, or northern island, or dublin, tokyo, several events in brazil. Were a global sport. Thats something that makes us different than anybody else. Scarlett truly globe. I think for a lot of people who might not know about professional mixed martial arts. They think back to wrestling and its manufactured and prewritten. Prescripted. This is not that. There is nothing prescripted about this. Its one of the actual things, we studied a lot about our fan base, what are the things you love about the u. F. C. . Consistently number one is unpredictibility. We have no idea what will happen. Thats one of the things thats exciting about the sport. Anybody can win. Scarlett anybody can win. Lets talk about one of your big wins which was this year when you led the u. F. C. To w. W. E. , what kind of changes to the business moddle is the new ownership looking to make . First thing we get a chance to leverage the incredible have. Ce that w. M. E. I. M. G. Now we have part of an organization that has about 7,000 employees. Went from a company five offices globally to a company that has 50. Weve got first of all a much bigger footprint. Second, they have tremendous expertise in so many areas we need to help us grow. Content, sales around the world, sponsorship. The creation of stars. W. M. E. Is the leading Talent Agency in the world. They develop stars in music and actors and movies and television. They are going to do the same thing for the u. F. C. And help us enhance us. Scarlett connor mcgregor, u. F. C. Fighter we mentioned, do we expect to see him in the mainstream of professional sports through global endorsements, personal essays . First of all i think the answer is yes. He already is. Connor has turned into not just a u. S. Phenomenon and but globally. I think its a great example of the u. F. C. A guy from the republic of ireland who has captured the imagination of brazil, u. S. , and the list goes on. Connor is breaking through. Espn for example is covering everything involving this fight. Media outlets around the world are. The endorsements are coming for him. The movie opportunities are coming for him. Hes already breaking through. I think hes going to get bigger and bigger. Scarlett last question, hes become more outspoken about his rights as an athlete at the center of the u. F. C. Do you think that where some people say that the u. F. C. Needs to do a better job of working with athletes tkeep them happy. Were proud of our relationship with our athletes. We have made dozens and dozens of millionaires and were proud of what we have done from everything of paying at the highest level to providing health care, to providing all the or things we provide to our athletes that treat them like free throw profegsals. Scarlett thank you for joining us. Chief operating officer for the u. F. C. They have their debut fight in new york city. Still ahead, the commodities close, oil falling to a sevenweek low. There you see crude losing 2 1 2 , 43. 53 a barrel. Scarlett bloomberg World Headquarters in new york, this is bloomberg markets. Commodity markets are closing in new york. Get a check on some of the biggest movers with julie hyman. Julie im focusing on three things today. Crude oil which is falling back after iran and iraq said that they had raised production last month and that saudi arabias production is still nearly at a record. That raises questions about the opec Production Cut agreement, which already was sort of in question. Crude oil is trading below 44 a barrel. We have copper futures coming off after a big run this week. Were going to talk more about that in a moment. And gold futures lower once again as well. Lets look at the weekly moves in these various commodities to give us a better picture whats going on. Crude oil has been bouncing around. Its down 1 1 2 a week overall but its had a roller coaster ride. Copper futures have had a monster rally. The biggest week ever, 14session rally in copper. On speculation that a Trump Presidency will bring Infrastructure Spending as part of that demand for copper that goes into construction. And gold as we have seen in the socalled safety trade, unravel in the wake of the election results. Things like the japanese yen and gold have paid the price for that. As for that move in copper to focus on that specifically, the magnitude of that move really took traders by surprise. So today getting punished a ittle bit, heres one chart. This is r. S. I. , relative strength indicator. Its a momentum indicator. When you have a monster rally like we have seen in copper prices, it gets to overbought levels on the momentum indicator. The pullback today is something of a reaction to that. Essentially a lot of folks have said that big rally in copper was likely overdone given the fundamentals. Scarlett you see the material stocks falling as well. Thank you so much. Meanwhile, the biggest players in the Energy Industry are now preparing for new policies under president elect donald trump. We spoke with the chairman and c. E. O. Of Conoco Phillips. First thing we talked about is the lower the prime rate in our National Portfolio doesnt take a lot to modestly grow the company. Its interesting. I have been in the business for 35 years. I always worried where production is coming from. Dont worry about that in our company today. We have clarity, we could go flat production for a decade but only spend 4 billion. Thats not an aspiration. We can spend a little more money. Were going to return the money back to the shareholders for growing dividends and flexibility share repayment, purchase program. Then we can put money to a low cost, high margin taxable supply inventory of amazing locations. Not only conventional locations, but unconventional. We can grow. Were going to deal with whatever returns the highest value. Were differentle of were not trying to chase were not going to chase the cycle down. 30 years of decline rate is pretty incredible. Again. Do you need to buy we have plenty of opportunities. We have 18 billion barrels of resource captured in our company today. That means we can make investments, generate an aftertax rate return of 10 , and only need a 40 oil price to deliver that. For 4. 5 million, we can maintain flat production for a decade. Thats the uniqueness of our company. Thats the Value Proposition we bring. Thats how we compete again. A 40 break even. The way the industry is being able to reduce their break even is incredible. Part has been the cost structure. Do you feel like the lower cost that you saw we look at our portfolio. We made some very significant structural changes. As these Major Projects hold off, we made a decision to get out of the exploration and development game. We made structural changes to our company. We have gone from nearly 10 billion of operating costs. This year we laid out a plan for 6 million. Dramatic reduction over the last year and a half. We look at our plan we would tell that you 20 to 30 of that may not fit. The structural changes we made in the k well see reinflation in the business as we go forward and prices start to recover. Were prepared tore that. We have to manage the margins. Capital is not your friend. Whats right or wrong about this story. Reducing risk, highlighting your reserves, improving your balance sheet. Are you seattle sething yourself up to be bought . This is the persuasion for somebody to come you did the right stuff. Ill take you to the next level . I hear that. I get that question. Its a reasonable question. What i tell people is the best defense is a good offense. We have to do what makes sense for our company, portfolio, and shareholders. The proposition we outlined in the street today in our Analyst Meeting is one about were about growing the dividend, compap discipline. That growth can be per share or organic and strong balance sheet. Thats how you weather the storm, the cycles in our business Going Forward. Its informed that we think prices will be lower and more volatile over time. You have to get your break even down. If other people see a lot of value in that, were going to keep doing what we know works. What we know returns the most value. You would think about it . You have to. You have to consider everything. No. Weve got a great plan as an independent company. Were differentiating ourself in the space. Were going to have a unique offering to the e. N. P. Kind of investors thats dramatically different than the other companies in the world today. Scarlett that was Conoco Phillips c. E. O. Ryan lance. Lets get to loombergs first word news. Mark. Mark Vice President elect mike pence is now leading president elect Donald Trumps Transition Team, replacing embattled new jersey goff christoforous tifment a federal jury convicted two of his former aides in the bridgegate scandal. Mr. Trump reportedly wants to use mr. Pences washington experience to move the process along. An executive committee, including members of congress, will advise pens. House Speaker Paul Ryan and senator Majority Leader Mitch Mcconnell are both urging residentelect trump to select priebus, both leaders say the National Committee chairman is the best choice. Mr. Trumps campaign chief is also said to be a candidate. In ohio, jurors have told a judge they cant reach a decision in the trial of a white former Police Officer who shot and killed an unarmed black man near the university of cincinnati. The panel is trying to reach a verdict on either murder or voluntary manslaughter charges against ray, who killed 43yearold sam bose during a traffic stop in july of 2015. A judge has told the jury to keep deliberating. At least three earthquakes have rattled parts of oklahoma today. No major injuries or damage was reported. They follow a magnitude 5 earthquake that hit a key oil hub in the northern part of the state on sunday. Scientist vs. Linked oklahomas increase in earthquakes to the underground disposal of wastewater from oil and gas production. Global news 24 hours a day powered by more that 2,600 journalists and analysts in over 120 countries. Im mark crumpton, this is bloomberg. Scarlett thank you so much, mark. Coming up, c. E. O. s from General Electric to apple and starbucks are trying to reassure employees that they support Workplace Diversity after Donald Trumps victory. Are they sending the right message . Scarlett this is bloomberg markets. Over the past 24 hours c. E. O. s of Major Companies from apple to starbucks have been sending letters to employees urging unity in addressing how business will move forward after the 2016 president ial election. Is this strategy necessary or does it deepen the divisions among employees . In todays walk the talk i put that question to shelly, founder and c. E. O. Of the female quoshent. I think this is an emotional time. I think were all in an emotional aftermath. Thats whats happening. This election, i call it the flipping point, everything you expected was flipped. So the unexpected happened. And when things like that, with that disruption it leaves people emotionally afraid. Grub hub c. E. O. Was very vocal and probably emotional in his memo to employees. He told his employees that anyone who has been insulting would be fired. He then backtracked to claire fy. Whats the right strategy for a c. E. O. If they do see or feel that this election increases the intolerance in their company . This is the time. The time is now when we do reinforce messages of diversity and incluesive and incluescy ofity and unity and compassion and empathy. What we want to do is beyond talking and the letter is one for reinforcing everyone. But its the actions that happen now. We have backwards in diversity and and i hope this is a call for action for us to pay closer attention and start creating new solutions for change. Scarlett certainly a lot of folks who supported Hillary Clinton feel like they might potentially be under attack. There are plenty of voters who supported donald trump and work at companies where their c. E. O. s are fairly vocal if their support of Hillary Clinton. Have c. E. O. s been so vocal . I have never seen c. E. O. s writing letters to their employees before in any election. I dont think this is so candidate specific. It was more emotional specific. It was a reaffirmation, a recommitment, a pledge for diversity. Within corporations today. And a no tolerance policy for anything other than that. Scarlett the tech elite in particular was very, very vocal about its support for Hillary Clinton. They dote nated money. They appeared at fundraisers with her, for her. They went out of their way to tout what they thought were her progressive values. Do you think that do you see the values at their own companies in practice . I believe social progress, social values, compassion, empathy are very important values for most corporations today. And i think that Mark Zuckerberg said it so well, from facebook, he said that progress is not a straightline. Its not linear. And that it is up to all of us to Work Together to advance equality, to advance incluescy ofity if we want to see it happen. Its not a one person show. It might be two such words. One step forward, one step back. Scarlett because technology as an industry was so vocal in its support for Hillary Clinton and opposition to donald trump, there is some speculation that the industry is more vulnerable in a Trump Administration. Do you think c. E. O. s, phrma, big banks, are reacting differently . Or thinking differently as a result . Our president elect, donald trump, talked about the economy and his whole campaign was about the pocketbook and making it better and about change. I think if he does walk the talk, he will ensure that diversity is it is a business impair tifment it is good for business. It imperative. It is good for business. It will help our economy. For that alone he is going to have to put his money where his mouth is and really reinforce diversity is very important inside all our corporations today because it does drive business change. Scarlett at the same time we know the 59 million americans they are not trump biggists and misogynist, they had a direction they felt a president clinton would not be able to address. Couldnt square that with her. How do executives who want to be pushing forward a Progressive Agenda be mindful of these sensitivities as well . I think sharing the information. This is a safe place for women. This is a safe place for lgbt. This is a safe place for all gender, all race, all cultures, all religions. This is a safe place. I think it needs continuous confirmation. I think it also needs the writing is on the wall. Show us that you are a culture of diversity by hiring that way. And sharing your success stories. Scarlett and that was my conversation with shelly zalik, shes the founder and c. E. O. Of the female quoshent. An update after that letter by grush hub c. E. O. , grub hub shares tumbled. Grub hub shares tumble. This is a little bit of an overdone reaction and he sees this as a good buying opportunity. President leekt donald trump announced his Transition Team this hour. Vice president elect mike pence will chair the team and executive Committee Members will include names including ben carson, new jersey governor Chris Christie, former House Speaker newt gingrich, among others. Washington correspondentent joins us from the white house on this news. If i remember correctly, Chris Christie was in charge of the Transition Team before he was essentially swapped out and mike pence was put in his place. Why mike pence . Donald trump is tapping people that he trusts. People that have been close to him, he can rely on, mike pence has those relationships on capitol hill having been a congressman. Hes proven himself to donald trump to be someone who is reliable and trustworthy. Stuck with donald trump through the access hollywood tapes and he trusts mike pence and believes hell be able to bridge that gap between donald trump someone who has never Held Public Office and capitol hill who he has to work with to bring forward the sligs that will allow him to get his agenda in place. Scarlett i get he wants to use mike pences washington experience. I wonder if this is a matter not relying on Chris Christie who does have baggage because of the bridgegate trial. Chris christie took a much lower position in the campaign once the trials were Going Forward and the trials concluded with the convictions of his top aides. Now i know donald trump doesnt want that attention on his campaign and on his transition. Thats one reason Chris Christie is still on the Transition Team but a lower position than he was earlier. Scarlett and also named to the executive committee are Donald Trumps three oldest children. Donald trump jr. , erik trump, and identify vanka. My understanding is they were supposed to be taking care of the business once donald trump got to the white house. Is that still the case . Yes. Donald trump made it very clear that he thought his children were going to run his business and not have a role within his administration. Thats a major change that were seeing with this new release. It shows that donald trump wants his children to be part of his administration, the planning. He trusts his children and he believes they are well equipped for the job. It will be interesting to see how donald trump works through the conflicts of interest between his business and his administration now that his children are going to be intricately involved in his administration while also running the trump organization. Scarlett do we have any idea, any update on how his businesses will be run . Yes, by his children, but directly or through a blind trust . His lawyers have said its going to be a blind trust, but they have also said that its going to be his children that are going to be running the blind trust. There are some questions about how blind the trust actually will be if his children are involved. Thats something that Trump Administration will have to work out over the next 70 days. How to make sure there arent as many conflicts of interest as many people are saying there are now. Scarlett the big question for everyone, especially those in the market, is trying to determine how much of candidate Donald Trumps platform will become president Donald Trumps agenda. Mitch mcconnell the Senate Majority gave some indication what the senate plans to work on. He basically is saying that the standard republican policy is going to be what donald trump focuses on. Things like donald trump is saying he wants infrastructure reform. Mitch mcconnell is saying things like tax reform will be high on the agenda. Obviously the Supreme Court pick will be very important. And republicans have been itching to do tax reform for a long time. That will be very high on the agenda. As well as repealing obamacare, something republicans have wanted to do for years now that donald trump will be the president , theyll have the opportunity to do that. Scarlett thank you so much. Our white house correspondentent joining us from the white house. Emerging market carry trade. The early list of losers with the donald Trump Presidency. We have more. Scarlett this is bloomberg markets. Emerging market bonds and stocks feeling the pain in the wake of a donald trump election this week. Both assets falling to four month lows as investors speculate the incoming president s Spending Plans may push up u. S. Inflation and Interest Rates. Its something well be digging into when our coanchor, joe wisen tall, joins me. I wonder if people are dumping. Joe there seems to be two components of the trade. One is were seeing Interest Rates rise in the United States. That makes high yielding foreign assets less compelling. There is a gap between the yield when that gap goes down, youre taking a lot of risk, so you are not getting paid as much to take that risk. There is an automatic selling aspect there. Then you combine that with the fact that trump continues, theoretically, this turn against globalization, lower tariffs, more global trade, more integration, a lot of that stuff is at the part of the bull case on emerging markets. Not just right now but over decades. And so the degree to whatever extent his policies can be implemented on that front also makes emerging market assets less attractive. Scarlett if youre looking at emerging market bonds, if they do take on u. S. Dollar bonds, those become more expensive. Joe later in the show were going to play an interview with our colleague, sid, who is talking about how you could see dollar liquidity issues in these economy, sort of a response to the higher Interest Rates. Already some of these countries have been talk about dollar shortages, higher rates and the u. S. Will exacerbate that further putting strains on the economy. Scarlett you are looking at the emerging market index. Thats the stock index. Its down joe 3. 3 for the week. That includes huge rallies on monday and tuesday. So almost misleading if you were to look at a threeday chart. At one point today the e. , m. E. E. M. , down about 8 1 2 . Over the last three days, since the election. Its actually much more brutal than that chart. Scarlett this is a good way of showing it. Joe there have been those red bars at the end, major outflows from these popular meerging market e. T. M. s, both on stocks and bonds. Well show some more of these charts that show how rapidly some of these flows have happened. The very flip side of this chart is, huge surge into the s. P. Y. , s. And p. 500. Scarlett what a lot of people are saying now is that the risk of version trade linked to donald Trump Presidency is not looking at the s p 500 as a barometer, its looking at asian currencies. India and indonesia had to intervene to support their currencies. Joe this is the problem with all these things. Everyone thought that u. S. Markets are going to get smashed and everything. We could definitely say in retrospect, it would have been more helpful. Scarlett everyone saw the trend and came up with something to match t joe and i will discuss this further on whatd you miss . In a couple minutes. Well speak with tommy show at 3 30 p. M. Eastern time. We have a lot of questions for him about what donald trump will do to financial regulation. Or in this case perhaps deregulation. Lets get you check on where the u. S. Stock market stands as we head into the final hour of trading for the week. The bhond markets closed for veterans day. You would expect to see less volume. The dow currently little changed after a fourday advance. The s p 500 getting back some of its advances while losing. 4 . On the week it is certainly still higher. Nasdaq bouncing back from a selloff yesterday. This is bloomberg. Scarlet i am scarlet fu. Welcome to bloomberg markets. We are live from bloomberg World Headquarters in the next hour, plus we are covering stories in san francisco, washington, and china. After Massive Gains this week, the stock market is coming back down. Global investors worry about the applications of a donald Trump Presidency. It is the biggest shopping day in the year in china and another recordbreaking day for alibaba. President elect trump sets his agenda, where does it leave wall street . We will speak with a ceo at the bottom of the hour. We are just 60 minutes away from the close of u. S. Trading. Julie hyman is here. The bond market is closed for veterans day, and it feels that way in the stock market. Julie things have called down considerably this week from the volume and price action. Nasdaq justwith the up nine points as the dow is very little changed, not even a 500 isint, and the s p still down. 4 percent. In the last hour we talked about commodities. We talk lets talk about stocks. Russell 2000 is up by nearly 10 on the week. This appears to be a function of the idea that domestically Oriented Companies might fare a trumpnder under administration, although there is also a lot of talk about repatriation of products that would benefit International Companies as well. Even though the bond market is closed today, it is worth mentioning what a huge week it was. Are is a look since they not open today, we made a chart of this. The 13 basis point on the five year. 10 year and 30 year, each of them a basis point gain. Were is a perception that will see increased stimulus by a trump government that would mean increased inflation as well. Finally, currencies. I want to look at emerging market specifically. This is on the bloomberg. Analyze looking at the dollar versus 24 emerging market current seas. The dollar rose against all of them except the colombian peso. Fared then peso worst, down 9 on the week. There is concern about the effect on emerging market economies of perhaps a more protectionist administration in the United States, but as with all of the other things we have been talking about this week, a lot of it is conjecture at this point. Scarlet julie hyman, thank you so much. Lets get you headlines with mark crumpton. Donaldresident elect trump has named his Transition Team. Vice president elect mike pence will chair the team. Committee members include ben carson, Chris Christie, newt gingrich, and jeff sessions. The team also includes tech entrepreneur peter thiel and children asmps well as his soninlaw. To leaveple are set the democratic National Committee. Former vermont governor howard dean says he wants his old job back. He was dnc chairman from 20052009. Keith ellison is expected to make an announcement on monday, and Martin Omalley says he is taking a hard look at the top job. Harry reid says white nationalists, russian president vladimir putin, and islamic extremists are celebrating trumps while innocent, americans are wracked with fear. He added that does not feel like america. President obama later wreath at at tomb of the unknowns Arlington National cemetery. Told the u. S. , he forces we are you our thanks, our freedom. Global news 24 hours a day covered by more than 2400 analysts in over 120 countries. Scarlet thank you. Since the election of donald trump, stocks have rallied and bonds have tanked. Is this a sign of things to come . Ask a chief investment officer. He joins us from san mateo. Great to see you. You had anticipated some volatility following the election of donald trump. Is this the volatility you had stocks went on a tear and didnt really slowed down until today whereas bonds have been selling hard . When you think about Election Night and the predictions about , it wasocks would open expected to be more similar to brexit where we did see a steep decline. I think investors were looking at that as a buying opportunity and ultimately, when we got to the open markets the day after the election, many were ready to buy. I think outlook for growth is ultimately what drove markets higher. What i do think is interesting, you mentioned the volatility in the bond market and the yields that we have seen, but with an equities, we have had quite a in leadership. Sectors that had been performing well in a low growth environment like consumer staples, certain utilities and real estate offstment trusts, they sold quite a bit. Sectors that could benefit from an improvement in the Growth Profile of the u. S. Economy Going Forward, financials and industrials performed well. Even the healthcare care sector was up quite strong. It was quite a deviation in sector performance. Scarlet even the healthcare car was up quite strong. I am glad you mentioned the staples. These bond proxies are all getting slammed. How are you adjusting in your fund . That is one of the more interesting things about the ,pportunity for yield today particularly when you think about it relative to markets 10 or 20 years ago. , traditional bond proxies like utilities offer yield, but other sectors, Like Technology for example, can offer a tract of. Can offerund in attractive yields. At Franklin Fund in particular. More than 50 trillion were sitting on the sidelines prior to the election, according to black rock. With some of that cash put to was some of that cash put to work or was that people taking money out of bonds and putting it into equities . Its a little bit of both. There is a dynamic of investors wanting to buy and seeing any pullback as an opportunity. Bonds have had a tremendous run, they were the beneficiary of a decline in Interest Rates. Even the shift in Central Banks had already happened preelection. We will see those globally start to migrate higher. Fiscal stimulus will accelerate that in the short run. Scarlet one sector where we still dont know what the president elect is going to do is financials. He has adopted some republican dogma, some democratic dogma. We are not sure where he stands. The Trading Volume has certainly picked up over the last week. Do you think trading will get a and be a boon to the financials . Especially with the Federal Reserve likely to raise Interest Rates in december and perhaps picking up the pace in 2017 . Theny time you see volatility that we have, that can drive some of the volume. It can be a positive for the sector. , a yield curvey improvement and interest margins, and possibly some improvement in the level of regulatory focus or scrutiny that has been on the industry is also being discounted by and contributing to the rally and financials. I am glad you mentioned the yield curve. Come inside the bloomberg. It is now at 120 six basis points. Three months ago it was 81. Thisuch further will steepen . Its a good question. I think when you look back three months ago, you are timing that pretty close to the postbrexit situation. Close to the yields when we sorrow real compression. When we saw a real compression. I think we will have to stay of inflationary pressures. Just the simple math and some of the lows in commodity prices, oil in particular, we are going to see increases Going Forward. That could contribute to a further steepening of the yield curve. Scarlet thank you so much, equity cio at franklin templeton. , a massive single shopping day with almost 18 billion dollars in single sales racked up. The alibaba president is with us next. This is bloomberg. This is bloomberg markets. Im scarlet fu. Time for a look at some of the biggest business stories in the news right now. It to the nexte round of bidding for central and according tots people familiar with the matter. There are about a half dozen bidders in the next stage of the operation. His profitstt saw increase by the trumps victory. 5. 8personal wealth grew by Million Dollars. He jumps to number two on the billionaire index. He is now worth 70 billion, but of course, his candidate lost. The new yorkbased retailer s closing all of its brick and mortar stores. It plans to focus on ecommerce and will continue to sell merchandise through participating retailers. Alibaba reports recordbreaking sales for a single day, november 11. The oneday bonanza dwarfs cyber monday and black friday combined. Chang spoke with alibaba president mike evans about the companys single day gala in shing ching china. China. Zhen what were really focused on are the hundreds of thousands of selling on the platform and the experience they are having connecting directly to consumers. We are also very focused on and experimenting with new ways for them to interact through vr, live streaming, and all sorts of ways that we have not tried in the past. Has been fun, engaging, educational and tremendous for consumers and brands. For us, having an opportunity to see the strength and resilience of our platform, processing orders at one hundred 70,000 per second, processing payments at , this is a second great test for resiliency. We are going to need a platform with these capabilities in order to build alibaba globally. One of your goals this year was to attract consumers outside china. They make up of sales this year . Move this year, we are making a big push in Southeast Asia where we bought a platform. Thats going very well. Our express business continues to sell products from chinese Small Businesses to more than 200 countries globally. That is going well. About brands from all over the world selling things to china, it is also about Chinese Companies selling to consumers. Emily the last time we spoke you told me the chinese economy is slowing but not slow. How does alibaba buck the trend of a slowing economy . It is highly unlikely we will continue to grow at 60 each year. That would be very, very difficult to do. We are at can see, least 30 plus percent higher than we were last year and it looks like we will see about 18 bottom line. But the real opportunity is that we are only penetrating about of the china Retail Market online. There is huge potential growth in that china market, together with everything we are planning to do as part of our Global Expansion initiative. We see tremendous opportunities for growth in the future. Emily president elect trump has said he is going to end trade agreements around the world. The alibaba chair has urged him not to adopt an isolationist stance. What would a Trump Presidency and some of the policies he is indicating mean for alibaba and for china . China is a great country. The United States is a great country. Thats speaking as a canadian who is not a citizen or resident of either. These are the two largest economies in the world, and for them to Work Together is what will be necessary not only for the benefit of both countries, but for the rest of the world, and i am confident that is the direction well beheaded headed. Emily bloomberg reports that trumps trade policy may be the biggest threat to alibaba. How would alibaba respond to potential trade terrorists, sanctions, or even a trade war . Remember that we currently do not sell that much product in the United States, but if you number onew who the beneficiary of the 1111 is this year, the u. S. Has the number one the largest number of brands selling to chinese consumers and consumers around the world. It is hard for me to imagine why we would not want that to continue. It is great for brands. It is great for retailers like macys and cosco. It is fantastic for job creation, wealth creation, and all of the thing that trump and many president s are focused on. Still ahead, twitter has been beaten down this year. This is bloomberg. Scarlet time now for options insight with julie hyman. Julie joining me is the chief strategist. Happy friday. We are seeing a little bit of calming down of the trade this week. I am curious what people will be looking for next. Obviously, this was a big event through to get through, the election. We have now gone through it. What do we expect . Craigs it took people a few hours, but people realized that a Solid Financial Foundation is in place. Low. Loyment is gdp is at 3 . Record profits, record balance sheets, unemployment below 5 . Its a good base to build on. Earnings season now is positive for the quarter. Growth quarter years. Arter for two now, looking toward 2017, we could have doubledigit earnings growth, and that could really set this market up. Julie so, you are looking at the backdrop. I assume that means you think we will continue to see a mutated fix. We have seen this game before. Every time it pops above 20, it gets whacked back down. It is back in that range. We are remaining below the five year range. Downside to the vix, more upside to stocks. Julie lets talk about twitter. We have heard some of the takeover chatter die down. Do you think its still a possibility . I this is an Options Strategy will be teaching at columbia next week. This is looking at takeovers. Somebody could come in and take over twitter. It has been trading between 1420 for most of this year. 26 was the ipo price way back in when. The way to play a potential takeover is to buy a january call and finance it by selling a june 20 call. Doesnt cost anything. What we are looking for is if and we pay acomes theseemium, both of options would have an Intrinsic Value so you would come out ahead about three dollars. Julie there is a six month in this calendar spread. You are looking to do is have something happen in the nearterm. A typical calendar spread you buy a longterm option and sell covertterm option to your bases. This is strictly for a takeover play. You have risk and you have to close this out before the january option goes on the board. Pay nothingt, you for the spread and no harm no foul. If it does, you earn a three dollar premium. Julie well be right back. Seeing is believing, and thats why were opening more Xfinity Stores closer to you. Visit us today and learn how to get the most out of all your services, like xfinity x1. Well put the power in your hands, so you can see how x1 is changing the way you experience tv with features like voice remote, making it easier and more fun than ever. Theres more in store than you imagine. Visit an xfinity store today and see for yourself. Xfinity, the future of awesome. Speed always wins. Especially in my business. With slow internet from the phone company, you cant keep up. Youre stuck, watching spinning wheels and progress bars until someone else scoops your story. Switch to comcast business. With highspeed internet up to 10 gigabits per second. You wouldnt pick a slow race car. Then why settle for slow internet . Comcast business. Built for speed. Built for business. Mark Vice President elect mike pence is now leading Donald Trumps Transition Team, replacing embattled governor Chris Christie. Mr. Trump reportedly wants to s washington experience to move the process along. House Speaker Paul Ryan and senator Majority Senate mcconnelleader mitch are both urging trump to select reince previous as white house chief of staff say the Committee National chairman is the best choice. Steve bannon is also said to be a candidate. A spokesman denies a newspaper report suggesting brazils Vice President may have received an Illegal Campaign donation. A court is investigating alleged irregularities in the financing of the 2014 campaign. South sudans civil war risks becoming a genocide according to the united nations, which cites recent examples of ethnically , civilians being targeted with machetes, and villages being burned to the ground. Verge ofuld be on the creating its own internet independent from the World Wide Web according to the countries Communication Ministry, which says the kremlin might make the move to tighten control over cross border data exchanges. It would also call for registering domains, ip addresses, and points of traffic exchange. Global news 24 hours a day powered by more than 2400 journalists and analysts in more than 120 countries. I am mark crumpton. This is bloomberg. Scarlet we are 30 minutes from the close of trading here in the u. S. I am scarlet fu. Joe and i am joe weisenthal. The Dow Jones Industrial average still on track for its best we can almost five years. Gained 1. 3ks trillion dollars this week. Investors are considering what a Trump Presidency means. We will be hearing on the future doddfrank. Meanwhile, bond traders bet that trump policies will boost inflation and Interest Rates. Carnage in developing nations where concerns about trumps policies have sent currencies to record lows. Where the look at major averages stand as we head toward the close. Bloombergs Abigail Doolittle is standing by. Majorl the three averages have been right around even all day. The dow is fluctuating between gains and losses. Not a lot of action today for it. Stocks, but on the week is a different story. And thenmassive rally not surprisingly, a big selloff in bonds. This is represented by the 10 year yield having its biggest spike ever, about a 21 gain. We are returning to the more traditional relationship between stocks and bonds. Stocks have rallied and safe havens have fallen off. For the dollar index, rising rates do help the dollar. Lets dive into the bloomberg. Bloomberg dollar index. On paper, its its best week , a real move higher in the currency markets. We see that all the way over to the side. Despite the fact that we have the dollar up very nicely on the week, above a 200 day moving average, which is bullish, there is a possible head and shoulders pattern forming here, something that is typically bearish in the longterm. On, aing to keep an eye contrarian view. ,s for what drove stocks higher we have the financial spider etf having its best week since 2009. 40 926. We see a longterm uptrend. We also see the area of conjecture and to the side. Beenrecently, it has trying to break out of that range and buyers have been trying to overtake the sellers. On the week, we have a massive spike higher, suggesting the buyers have in fact taken out the sellers and more strength is ahead for the financial sector. Joe thank you very much. Election of donald trump has seen banks rallied to levels not seen in years thanks impart to the belief that he will bring less regulation to the industry. What will less regulation bring . Tom, we know donald trump wants to get rid of doddfrank. He also thinks banks are too big to fail. To that end, he wants to bring back glass seagull. What is your understanding of the kind of changes donald trump would want to make to the financial industry. I have seen a lot of comments. Ishink what is most probable elements of the two bills we have seen in congress over the last year, the house and the senate, typically, those bills due to things. They increase the tearing of regulation. I think global banks are still likely to get a lot of regulation, maybe with a little bit of easing. I think we are to see midand room. Cap banks get more they want to address the banks the cost the crisis. We talk about regulation as if it is an abstract saying where you can turn a dial and get more or less, but what there is an idea that if they can rollback regulation there can be more lending and more business what specifically do think could be pulled back to encourage that . Two things. Rector of thent Consumer Financial Protection Bureau does not report to a governing body or get his budget from congress. He essentially operates under his own direction. Is talk about whether he can or cannot be replaced by the president. Scarlet has he had that much impact . The Consumer Financial Protection Bureau has had a lot of influence on the industry. You have to go through the annual stress test. Its a lot of work and a lot of money. Banks slow down their growth before they get the 50 billion. Its not good for the economy to slow down growth to avoid the extra expense of getting there. There are unintended consequences. Joe and does all of her pointed out yesterday on the show as liver pointed out yesterday on the show, its really that banks that are small cap financials that look to benefit. Smaller banks get more spread income then bigger banks and so they are bigger beneficiaries. So, does he modify his views somewhat or does the Republican Controlled Congress moved to his direction . Both the senate and the house have passed these bills. They are amending doddfrank. Doddfrank is a 2000 page bill. You are not going to unplug it and start over again. I think that slows the economy down, the uncertainty. Better off making it better. In the six years since it passed, there has been no appetite on the democratic side to make that happen. Now at least it will be reexamined. The trumps it in white houses interest to dismantle it completely . Have seen in other bills that have been introduced to date are lets put a bipartisan governing authority over it and have congress set the budget. Thats the first step. It intothey merge another agency, Consumer Protection is not going to go away. I dont think anybody wants to see that happen. They have 1500 employees right now and the agency was born in 2010. Where is this headed . Scarlet at the same time, the agency is leading the effort to find wells fargo over its scandals. And that has populist support. What one is happy about happened at wells fargo. They would be in trouble whether there was a cfp beer not. Cfpb or not. Joe in trumps fine all ad of the cant in trump on spinal out of the campaign, he went after the elites of finance in trumps final ad of the campaign, he went after the elites of the financial agency, but they seem to be happy about how things have developed. Are they being too naive . This is my own observation. The team that dealt with the crisis was still in their position for the last eight years. It was very hard to transition from lets stabilize and think about growth. Now we are starting over with a new team that will be more growth focused. I think that is what wall street is embracing. Scarlet does that mean they take some of what he has also said less seriously, sledging slamming hedge funds or private equities and saying they dont take pay enough taxes . There have not been an extraordinary amount of details in the proposals we have seen. A lot of it is still in the pump, but lets wait and see. Of energyere is a lot for change, getting it right, fixing it. When you look at his Transition Team, most of them are very experienced people. Lets see what they come up with. Joe but the truth is we dont really know. Snow, but they are looking for signs. I think the biggest sign is that we needed a reexamination and a fresh look. Its incredible that doddfrank was passed over six years and has never been amended. Theres no way anyone thought that was perfect on the first attempt. Scarlet there is a headline in the wall street journal that president obama said he would consider leaving imparts certain parts of obama care. I think if you start all over, you are going to put so much uncertainty and take so long to pass a piece of that, that like could slow down the economy. My sense is there is a lot of energy to get this economy growing again. Scarlet thank you. Coming up, bob iger of walt disney shares his thoughts on this weeks election surprise. Joe bob iger weighed in on what presidency could mean for disney. He spoke about the medias controversial role in the election. So far so good in terms of what i will call transition, even though its very early. I think the president elect and president obama have approached this smartly. Be cordial, be open, understand that the most important thing is america, not one party oranother another, so lets be gentlemanly about it. That instills confidence in our country and faith that the , even if your ideology is not necessarily represented in the next president of the United States. Its too early to really predict will be foricies this new administration. Its way too early to speculate publicly. We have been talking a lot and about the need for a new tax policy. The Corporate Tax rate is the highest in the world. It needs to get fixed. It needs to get lowered. We need to close loopholes. The sooner the better. I think its going to be addressed, but its too early to say. You are a student of the media. You have lived your entire professional career in the media. Its not too soon to start asking the question of the role in the media in this election. This is a different media than even four years ago, or eight years ago. Certainly, donald trump took full advantage of that, both in terms of being able to get access to the cable channels, and also on social media. Is the media starting to think about its role in future elections and what role it should be playing as the Fourth Estate . Or is a lot of handwringing about the media this week and its role in the election. Think that handwringing is missing the point, and the point its missing is that the media today doesnt look anything like the media of yesterday. We are living in a world where the sheer definition of media not the definition of what the industry creates, but what people create is extremely different than what it used to be, how we get our news, what we consider news, how information travels, how fast it travels, its vastly different. I would argue that the media played a positive role in this campaign in the sense that it was ever present, which media is today. ,t was eyes on, cameras on everything exposed, everything subject to scrutiny by the new. Edia did the media get it right in terms of predicting the outcome . No, and i think that deserves some scrutiny. How did they get it wrong . I dont think the way the campaign was covered is something that deserves criticism. We can always be reflective of it, thats fine. But media today doesnt look anything like it did five years ago, 10 years ago. Its just different. Those whos time that follow the media from a critical perspective except the fact that the media they are following today accept the fact that the media they are following today is vastly different from the media they use to follow or that they think they are following. Alibaba is celebrating another record sales day. Sales have hit 17. 8 billion. It is the single biggest shopping day of the year for alibaba. Indias biggest feud is taking another ugly turn. Musclere being taken to outchairman of tata permanently. Than 10lost more billion in market value. Is adopting new tools in response to allegations of discrimination. The social network will no chooseallow marketers to ethnic or racial groups when placing ads related to housing. Use ofk will disable any ethnic marketing. That is your business flash update. Joe up next, with the u. S. Election out of the way, europes focus turns to a series of votes in the coming months. Brexit and one thing the u. S. Election have taught us this year, it is that polls cant always be trusted. We will show you two ways of tracking italys vote for Prime Minister next. This is bloomberg. Shares onechnology thursday moved at a rate last seen in the aftermath of the bubble. Sought old Economy Companies because Donald Trumps Infrastructure Spending would certainly give those companies a boost. At the same time, we saw ,echnology shares back off facebook, amazon, netflix, google, all backing off quite a bit. What resulted was the biggest of virgins between the dow and the nasdaq since 2001. Showseen horizontal line dow outperformance. The circle their shows what happened yesterday. Thanks to dan curtis, by the way, who put this together. The last time this happened was 2001. Which would make sense, when the tech stocks were leading the way down. Bloody days for the nasdaq back then. Is, g of the virgins speaking of divergences, people are looking for the next geopolitical trouble spots and where a vote might go against the status quo. In early december, we have a referendum in italy on a change to the constitution that would make it easier to pass laws. Matteo renzi has said he would design if it didnt go his way. No is holding a pretty solid lead. A few undecideds say they would not vote for this change and oft it could lead to the end moderates. Lets look at the market of locations of this. I have a chart. Red is 10 year yields between italian debt and spanish debt. Peripherale the countries which are arguably similar economically. 2012 was the last time italy had to pay this much more to borrow relative to spain. Spain, it took a year for them to finish their president ial election, but people are not worried about their politics in spain. They are very concerned about italy, and you should keep an eye on the italy and spain spread because it is widening. This is a sign that people are sniffing out italy as the next major spot that could suffer from a geopolitical blow. I wonder how much of this is selfinflicted. Say heid not have to would step down. Exactly. Its bringing out the enemies. Torlet about four minutes go before the close. We do have the s p 500 down. The dow has moved slightly higher. Adding 44 points. Is that another record high for the dow . Rebounding as well. This is bloomberg. Scarlet we are moments away from the closing bell. . Hat did you miss commodities tumbling as traders parse the implications of a donald Trump Presidency for the worlds biggest economy. Fu. Scarlet joe and i am joe weisenthal. I want to welcome our viewers on twitter. You can watch closing bell coverage of every day on twitter from 4 005 00. Lets begin with our market minute. The dow turned around and closed at another record high. Market was closed. There was no Economic Data released today. Record high, the for the dow is the best since 2011. S p 500 saw its best week since 2014. After anhtly quiet extraordinary week in world events