1 00:00:03,120 --> 00:00:07,720 Speaker 1: Broadcasting live to New York, Bloomberg even to Washington, d C. 2 00:00:07,920 --> 00:00:13,200 Speaker 1: Bloom to Boston, Bloomberg twelve hundreds, to San Francisco, Bloomberg 3 00:00:14,040 --> 00:00:17,800 Speaker 1: to the Country series General one ninety and around the 4 00:00:17,840 --> 00:00:21,799 Speaker 1: globe the Bloomberg Radio plus Bloomberg dot Com. This is 5 00:00:21,840 --> 00:00:26,079 Speaker 1: Bloomberg Surveillance. Good party. It is seven thirty on Wall 6 00:00:26,160 --> 00:00:28,479 Speaker 1: Street on Michael McKee along with Tom Key. There is 7 00:00:28,520 --> 00:00:32,520 Speaker 1: a lot going on, sort of merger Monday today. Let's 8 00:00:32,560 --> 00:00:35,959 Speaker 1: get right to it. Starwood accepting an improved bid from 9 00:00:36,040 --> 00:00:40,200 Speaker 1: Marriott International now thirteen point six billion tops the offer 10 00:00:40,200 --> 00:00:42,880 Speaker 1: from the group of investors led by China's a Bang 11 00:00:43,040 --> 00:00:47,960 Speaker 1: Insurance Groups. Star Woods shares up three percent in early trading. 12 00:00:48,120 --> 00:00:50,720 Speaker 1: W L Ross Holdings will buy Nextico Solutions from the 13 00:00:50,720 --> 00:00:54,120 Speaker 1: private equity group TPG stock in cash, an enterprise value 14 00:00:54,120 --> 00:00:56,480 Speaker 1: of one point six seven billion. By the way, w 15 00:00:56,560 --> 00:00:59,840 Speaker 1: L Ross will change its name to Nextio Solutions to 16 00:01:00,000 --> 00:01:03,840 Speaker 1: b l Ross shares not trading yet, but they were 17 00:01:03,880 --> 00:01:07,319 Speaker 1: down just tenth of a percent on Friday. Sherwin Williams, 18 00:01:07,360 --> 00:01:10,680 Speaker 1: the largest US paint retailer, gonna buy its competitor Valspar 19 00:01:11,000 --> 00:01:14,800 Speaker 1: nine point three billion dollars in cash right now, Sherwin 20 00:01:14,840 --> 00:01:19,360 Speaker 1: Williams shares down two percent. Valspar shares up twenty seven 21 00:01:19,480 --> 00:01:23,360 Speaker 1: percent so far this morning. Also Intel getting downgraded to 22 00:01:23,560 --> 00:01:27,080 Speaker 1: underperformed for market perform at Bernstein twelve lone target price 23 00:01:27,080 --> 00:01:29,959 Speaker 1: of twenty six dollars a share they closed at eight 24 00:01:30,040 --> 00:01:34,960 Speaker 1: on Friday. Right now stock down one point seven percent. Now, 25 00:01:35,040 --> 00:01:36,959 Speaker 1: let's check out with Michael Barr and get the latest 26 00:01:37,000 --> 00:01:39,560 Speaker 1: world and national headlines. Michael, Mike, thank you very much. 27 00:01:39,600 --> 00:01:43,080 Speaker 1: President Obama will meet today with Cuban President Raoul Castro. 28 00:01:43,360 --> 00:01:46,760 Speaker 1: This is a historic visit, and it's a historic opportunity 29 00:01:47,200 --> 00:01:49,720 Speaker 1: to engage directly with the Cuban people and the forge 30 00:01:49,760 --> 00:01:53,360 Speaker 1: new agreements and commercial deals, to build new ties between 31 00:01:53,720 --> 00:01:56,320 Speaker 1: our two people's uh and for me to lay out 32 00:01:56,360 --> 00:01:58,760 Speaker 1: my vision for a future that's brighter than our past. 33 00:01:59,040 --> 00:02:01,760 Speaker 1: The President and you, bumb will attend a formal welcoming 34 00:02:01,760 --> 00:02:04,480 Speaker 1: ceremony and meeting with Castro at the Palace of the 35 00:02:04,520 --> 00:02:07,720 Speaker 1: Revolution and a state dinner in the evening. South Korea 36 00:02:07,800 --> 00:02:10,800 Speaker 1: says North Korea has fired at least four short range 37 00:02:10,800 --> 00:02:14,560 Speaker 1: projectiles into the sea. It's an apparent response to ongoing 38 00:02:14,639 --> 00:02:18,680 Speaker 1: South Korea US military drills it sees as a provocation. 39 00:02:19,160 --> 00:02:22,400 Speaker 1: Today's launches came three days after Soul said North Korea 40 00:02:22,720 --> 00:02:26,120 Speaker 1: launched its first medium range missile into the sea since 41 00:02:26,120 --> 00:02:30,079 Speaker 1: early A group of about forty millionaires in New York 42 00:02:30,120 --> 00:02:32,560 Speaker 1: State have sent a letter to Governor Andrew Cuomo and 43 00:02:32,639 --> 00:02:35,320 Speaker 1: of the lawmakers in favor of higher taxes on the 44 00:02:35,360 --> 00:02:39,080 Speaker 1: state's wealthiest residents. According to the Associated Press, the letter 45 00:02:39,360 --> 00:02:42,359 Speaker 1: is calling for higher taxes to address poverty and rebuilding 46 00:02:42,400 --> 00:02:45,400 Speaker 1: the infrastructure. Global Things twenty four hours a day, powered 47 00:02:45,400 --> 00:02:51,040 Speaker 1: by our journalists. I'm Michael Barr. Thank you, Michael. Now 48 00:02:51,240 --> 00:02:54,519 Speaker 1: it's time for the Ray Katina Auto Group Bloomberg NBC 49 00:02:54,680 --> 00:02:57,840 Speaker 1: Sports Update with John stash Our John Mike. It was 50 00:02:57,840 --> 00:03:00,079 Speaker 1: the biggest comeback in the final minute of an n 51 00:03:00,120 --> 00:03:03,520 Speaker 1: C Double A tournament game ever. Northern Iowa led Texas 52 00:03:03,560 --> 00:03:06,160 Speaker 1: A and M by twelve with under forty seconds ago 53 00:03:06,280 --> 00:03:09,840 Speaker 1: by five with fourteen seconds left, back came the Aggies. 54 00:03:09,880 --> 00:03:11,720 Speaker 1: They tied the game. They ended up winning in double 55 00:03:11,800 --> 00:03:15,680 Speaker 1: overtime ninety two to eighty eight. Heartbreak for Northern Iowa, 56 00:03:15,840 --> 00:03:17,799 Speaker 1: who had won its game Friday on a shot from 57 00:03:17,840 --> 00:03:21,680 Speaker 1: half court Xavier knocked off by Wisconsin sixty sixty three 58 00:03:21,720 --> 00:03:25,200 Speaker 1: and a Bronson Canick three pinner at the buzzer. Oregon 59 00:03:25,240 --> 00:03:27,600 Speaker 1: had the rally to beat St. Joe's sixty nine to 60 00:03:27,840 --> 00:03:31,000 Speaker 1: sixty four. Nicks played without Carmelo Anthony to a migraine. 61 00:03:31,040 --> 00:03:34,280 Speaker 1: Sacramento took advantage up sixteen after the first quarter of 62 00:03:34,280 --> 00:03:37,280 Speaker 1: The Kings won eighty eight to eighty Robin Lopez twenty 63 00:03:37,360 --> 00:03:39,880 Speaker 1: three points, twenty rebounds. The Lost Devils used a new 64 00:03:39,960 --> 00:03:43,880 Speaker 1: goalie in top Columbus two one. In Scott Wedgwoods NHL debut, 65 00:03:43,960 --> 00:03:46,120 Speaker 1: Jason Dave won the bey Hill Golf by shot. Indian 66 00:03:46,120 --> 00:03:49,040 Speaker 1: Wells Tennis Victoria as a rank up set. Serena Williams 67 00:03:49,040 --> 00:03:52,200 Speaker 1: Novak Djokovic won the final six two six love with 68 00:03:52,320 --> 00:03:56,400 Speaker 1: the Bloomberg NBC Sports Update, I'm John stap Shandler. Thank 69 00:03:56,440 --> 00:03:59,160 Speaker 1: you Johns. Right now, we are looking at a market 70 00:03:59,160 --> 00:04:01,920 Speaker 1: on this merger mondy that is just barely higher. SMP 71 00:04:02,040 --> 00:04:04,200 Speaker 1: features up by a point a tenth of a percent, 72 00:04:04,320 --> 00:04:08,680 Speaker 1: down features by sixteen points. That's also a tenth higher. 73 00:04:09,120 --> 00:04:12,080 Speaker 1: Europe unchanged, at least on a broad basis, the stock 74 00:04:12,120 --> 00:04:20,400 Speaker 1: six hundred is not moving right now. Welcome back to 75 00:04:20,520 --> 00:04:24,520 Speaker 1: Bloomberg's avalance. I'm Michael McKee along with Tom Keene. We 76 00:04:24,560 --> 00:04:27,719 Speaker 1: are looking at a dollar index on the day that 77 00:04:27,960 --> 00:04:32,640 Speaker 1: is unchanged at point one zero nine. But the dollar 78 00:04:32,800 --> 00:04:35,760 Speaker 1: is higher against the yen one fifty, not going to 79 00:04:35,880 --> 00:04:40,440 Speaker 1: be welcomed news in Tokyo. The euro is a little 80 00:04:40,480 --> 00:04:43,920 Speaker 1: bit higher one twelve seventy three, which is not something 81 00:04:43,960 --> 00:04:48,000 Speaker 1: they want to see either. Time now for the Bloomberg 82 00:04:48,120 --> 00:04:50,520 Speaker 1: n j I T STEM Report, brought to you by 83 00:04:50,600 --> 00:04:53,800 Speaker 1: New Jersey Institute of Technology, partnering with government and industry 84 00:04:54,000 --> 00:04:56,680 Speaker 1: to apply the university's world class research assets to innovate 85 00:04:56,720 --> 00:04:58,919 Speaker 1: and spur economic growth. Learn more at n j I 86 00:04:59,040 --> 00:05:02,400 Speaker 1: T dot e DU. Here's Bob Mood Michael Good Morning, 87 00:05:02,400 --> 00:05:04,400 Speaker 1: coming up on seven thirty five on Wall Street, and 88 00:05:04,440 --> 00:05:08,000 Speaker 1: here's what's making news in science, Technology, engineering, and math. 89 00:05:08,400 --> 00:05:11,200 Speaker 1: After weeks of sniping back and forth through legal briefs 90 00:05:11,200 --> 00:05:14,440 Speaker 1: and news interviews, Apple and the US Justice Department are 91 00:05:14,520 --> 00:05:16,800 Speaker 1: due to face off in the California courtroom this week. 92 00:05:17,080 --> 00:05:19,840 Speaker 1: Apple has asked the US magistrate judge to drop an 93 00:05:19,920 --> 00:05:23,000 Speaker 1: order to help the FBI hack into a terrorist iPhone, 94 00:05:23,200 --> 00:05:26,960 Speaker 1: and a hearing is scheduled for tomorrow There's word meantime 95 00:05:27,000 --> 00:05:30,479 Speaker 1: that a bug has been found in Apple's encryption, albeit 96 00:05:30,600 --> 00:05:32,919 Speaker 1: one that The Washington Post reports likely would not have 97 00:05:32,960 --> 00:05:36,200 Speaker 1: helped the FBI in the Southern California case. Still, Johns 98 00:05:36,200 --> 00:05:39,960 Speaker 1: Hopkins University researchers report a flaw in Apple's Eye message 99 00:05:40,000 --> 00:05:43,320 Speaker 1: platform that could enable a skilled attacker to decrypt photos 100 00:05:43,320 --> 00:05:47,360 Speaker 1: and videos sent as secure instant messages. Johns Hopkins computer 101 00:05:47,360 --> 00:05:50,360 Speaker 1: science professor Matthew Green told the Post, it scares me 102 00:05:50,440 --> 00:05:53,520 Speaker 1: that we're having this conversation about adding backdoors to encryption 103 00:05:53,839 --> 00:05:57,680 Speaker 1: when we can't even get basic encryption right. And BMW 104 00:05:57,680 --> 00:06:00,520 Speaker 1: wants to see its work on self driving vehicles start 105 00:06:00,560 --> 00:06:03,360 Speaker 1: paying off. Now. It hopes to use the early technology 106 00:06:03,360 --> 00:06:06,760 Speaker 1: it's developed to squeeze out cost savings on the factory floor. 107 00:06:07,040 --> 00:06:10,080 Speaker 1: The car maker is testing suitcase size robotic trolley's to 108 00:06:10,120 --> 00:06:13,200 Speaker 1: move car parts around, and while self driving cars may 109 00:06:13,200 --> 00:06:16,640 Speaker 1: not be ready for years, BMW says this automation efficiency 110 00:06:16,720 --> 00:06:20,640 Speaker 1: drive should help cut costs by five percent per car annually. 111 00:06:21,080 --> 00:06:24,479 Speaker 1: And that's this morning's Bloomberg and j I t Stem report. Michael, 112 00:06:24,720 --> 00:06:26,320 Speaker 1: thank you, Robert, Well, it's a good thing you brought 113 00:06:26,400 --> 00:06:28,719 Speaker 1: up Apple, because That's what Brian White is here to 114 00:06:28,720 --> 00:06:32,400 Speaker 1: talk about as senior equity analyst at Drexel Hamilton's. It is, 115 00:06:32,440 --> 00:06:34,120 Speaker 1: of course today when Tim Cook is going to go 116 00:06:34,160 --> 00:06:36,640 Speaker 1: before the public and introduce a new iPhone. But before 117 00:06:36,680 --> 00:06:38,479 Speaker 1: we get to that, let me just go back to 118 00:06:38,720 --> 00:06:41,320 Speaker 1: something Bob was talking about, and that is this whole 119 00:06:41,640 --> 00:06:44,040 Speaker 1: Apple versus the Justice Department case. I'm not going to 120 00:06:44,120 --> 00:06:46,440 Speaker 1: ask you to tell us how judges are gonna rule, 121 00:06:46,520 --> 00:06:51,320 Speaker 1: but is there a risk to the stock price in 122 00:06:51,440 --> 00:06:55,720 Speaker 1: this whole dispute? You know, the stock has actually acted 123 00:06:56,080 --> 00:06:59,960 Speaker 1: fairly well as this dispute is unfolded, So I don't 124 00:07:00,160 --> 00:07:03,440 Speaker 1: see a risk really as an analyst here um and 125 00:07:03,640 --> 00:07:06,320 Speaker 1: in the risk of the stock price. But you know, 126 00:07:06,400 --> 00:07:09,600 Speaker 1: I think there is bigger discussion for the tech industry, 127 00:07:09,600 --> 00:07:11,440 Speaker 1: and I think that's why Apple's taking the stance that 128 00:07:11,520 --> 00:07:17,680 Speaker 1: has taken. Long term, How should investors think about it, Well, 129 00:07:17,800 --> 00:07:21,200 Speaker 1: I think, um, you know, I think it's uh, it's 130 00:07:21,240 --> 00:07:24,520 Speaker 1: something that would have an impact across all tech companies, right, 131 00:07:24,600 --> 00:07:27,920 Speaker 1: so it would set a precedent either way for all 132 00:07:27,960 --> 00:07:30,160 Speaker 1: the big tech organizations. And I think that's why a 133 00:07:30,160 --> 00:07:33,080 Speaker 1: lot are coming um in supporting Apples. But again, I 134 00:07:33,200 --> 00:07:37,320 Speaker 1: I don't look at this as a material event for 135 00:07:37,360 --> 00:07:40,640 Speaker 1: Apple's stock price. I think it has bigger implications. All right, well, 136 00:07:40,640 --> 00:07:43,400 Speaker 1: there's a good phrase to pivot to the new iPhone. 137 00:07:43,880 --> 00:07:47,360 Speaker 1: Uh does it have material implications for Apple's stock price? 138 00:07:47,520 --> 00:07:50,040 Speaker 1: It seems like they're filling in a hole rather than 139 00:07:50,240 --> 00:07:53,800 Speaker 1: moving the ball forward. Yeah, so it's it's a great question. Um, 140 00:07:53,880 --> 00:07:56,640 Speaker 1: this event today is more of a stepping stone to 141 00:07:56,680 --> 00:08:00,400 Speaker 1: the iPhone seven launch in September. I do see an 142 00:08:00,400 --> 00:08:04,200 Speaker 1: opportunity for a mid market Apple playing with the iPhone 143 00:08:04,200 --> 00:08:08,080 Speaker 1: in the mid market. Um. Typically they discount older products, 144 00:08:08,200 --> 00:08:11,240 Speaker 1: older iPhones to play in this area, or they release 145 00:08:11,320 --> 00:08:14,840 Speaker 1: the iPhone five C in September, which did not go 146 00:08:14,920 --> 00:08:17,600 Speaker 1: so well. It wasn't cheap enough. Um, some of the 147 00:08:17,640 --> 00:08:20,720 Speaker 1: features were older. I think today you'll get something that 148 00:08:20,840 --> 00:08:24,720 Speaker 1: might be four five hundred dollars versus sixty nine for 149 00:08:24,760 --> 00:08:27,880 Speaker 1: the iPhone Success today, and it will have some of 150 00:08:27,880 --> 00:08:30,360 Speaker 1: the updated features of the iPhone Success, but it will 151 00:08:30,360 --> 00:08:35,280 Speaker 1: be smaller at four inches. Is this a major development 152 00:08:35,280 --> 00:08:38,520 Speaker 1: for Apple or incremental? I think it's incremental. You know, 153 00:08:38,600 --> 00:08:43,800 Speaker 1: they probably don't even totally know how many units they 154 00:08:43,840 --> 00:08:46,520 Speaker 1: could sell into this market. Mid markets a huge area. 155 00:08:47,160 --> 00:08:50,000 Speaker 1: And I look at the middle class. There's one point 156 00:08:50,120 --> 00:08:52,439 Speaker 1: four billion people being added to the middle class this 157 00:08:52,520 --> 00:08:56,440 Speaker 1: decade are coming to Asia. So I think those that 158 00:08:56,520 --> 00:09:00,000 Speaker 1: can't go out in quite afford success or don't want 159 00:09:00,080 --> 00:09:02,360 Speaker 1: spend that much, this might be a good phone for them. 160 00:09:02,400 --> 00:09:05,200 Speaker 1: And often you'll see that in developing countries. Some people 161 00:09:05,240 --> 00:09:07,480 Speaker 1: just like a foreign phone, right, and so there's a 162 00:09:07,480 --> 00:09:10,800 Speaker 1: market for that. Do we see any Uh. Apple likes 163 00:09:10,840 --> 00:09:12,720 Speaker 1: to develop software at the same time as they bring 164 00:09:12,840 --> 00:09:14,920 Speaker 1: us a new phone, and we see any software changes 165 00:09:14,960 --> 00:09:19,480 Speaker 1: coming today? Um, you could see some software updates for 166 00:09:19,520 --> 00:09:23,680 Speaker 1: the Apple Watch potentially, Okay, Um, I don't think on 167 00:09:23,679 --> 00:09:26,959 Speaker 1: on the iPhone you'll really see some major updates today. Yeah, 168 00:09:26,960 --> 00:09:29,240 Speaker 1: I think it'll be more of an iPhone and iPad event. 169 00:09:29,440 --> 00:09:31,480 Speaker 1: Do we see that in the fall with a with 170 00:09:31,559 --> 00:09:34,719 Speaker 1: an iPhone seven is a more likely. Yeah, definitely. You'll 171 00:09:34,720 --> 00:09:37,640 Speaker 1: get the updated iOS, so that'll be announced probably in June, 172 00:09:37,960 --> 00:09:40,080 Speaker 1: and then you'll get the update in September with a 173 00:09:40,080 --> 00:09:42,480 Speaker 1: new iPhone seven, which I think, you know, iPhone seven 174 00:09:42,760 --> 00:09:44,840 Speaker 1: should be a big deal. You know it's uh, it's 175 00:09:44,920 --> 00:09:48,760 Speaker 1: it's the rounded numbers which come every two years. That 176 00:09:48,840 --> 00:09:51,079 Speaker 1: are really the big iPhone releases, and that's a lot 177 00:09:51,120 --> 00:09:54,120 Speaker 1: to look forward to. About thirty seconds left. Stock is 178 00:09:54,160 --> 00:09:57,400 Speaker 1: at one oh five, a little change today ahead of 179 00:09:57,440 --> 00:10:00,480 Speaker 1: the announcement, but where does it go the rest this year? 180 00:10:01,400 --> 00:10:03,360 Speaker 1: I think you want to own the stock here. You know, 181 00:10:03,400 --> 00:10:06,200 Speaker 1: we have a two dollar price target. UM it's trading 182 00:10:06,200 --> 00:10:08,719 Speaker 1: at nine times X cash. It's growing EPs thirty nine 183 00:10:08,760 --> 00:10:10,800 Speaker 1: percent a year. You can look at the SMP, it 184 00:10:10,960 --> 00:10:13,240 Speaker 1: gets grown five percent a year over the last eight 185 00:10:13,280 --> 00:10:16,400 Speaker 1: years and it trades at sixteen times. So Apple is 186 00:10:16,480 --> 00:10:18,959 Speaker 1: very inexpensive here, Brian White, thank you very much from 187 00:10:19,080 --> 00:10:23,679 Speaker 1: Drexel Hamilton's the of course, Tim Cook and the Apple 188 00:10:23,720 --> 00:10:27,079 Speaker 1: folks will be out this afternoon it's like one o'clock 189 00:10:27,080 --> 00:10:31,920 Speaker 1: our time with their latest announcement of the new mid 190 00:10:32,040 --> 00:10:38,400 Speaker 1: range iPhone and possibly as uh Brian says, something to 191 00:10:38,720 --> 00:10:41,680 Speaker 1: fix up the software, advance the software in the Apple 192 00:10:41,679 --> 00:10:44,320 Speaker 1: Watch and we'll have full details for that for you, 193 00:10:44,440 --> 00:10:47,600 Speaker 1: of course on the Bloomberg Advantage with Corey Johnson and 194 00:10:47,679 --> 00:10:51,319 Speaker 1: Carol Masster this afternoon. Right now we're looking at as 195 00:10:51,320 --> 00:10:54,319 Speaker 1: I said, uh, Apple price it's unchanged at one oh 196 00:10:54,360 --> 00:10:58,679 Speaker 1: five an SMP that's up one point uh tenth of 197 00:10:58,720 --> 00:11:05,920 Speaker 1: the percent. Bloomberg surveillance isn't brought to you by Westchester Suburu. 198 00:11:06,000 --> 00:11:08,079 Speaker 1: Visit Westchester suburu dat com