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Speaker 1: Global business news twenty four hours a day at Bloomberg

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Speaker 1: dot com, the Radio plus mobile app and on your radio.

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Speaker 1: This is a Bloomberg Business Flash. And with the Bloomberg

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Speaker 1: Business Flash, I'm Don Tucker. The US Index futures said

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Speaker 1: they remaining lower after slide sparked by the Bank of Japan.

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Speaker 1: They refrain from further stimulus measures overnight. We also data

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Speaker 1: today showing the US economy expanded in the first quarter

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Speaker 1: at the slowest pace in two years. American consumers ranged

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Speaker 1: in spending. Companies also tighten their belts into response to

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Speaker 1: weak global financial conditions and the plunge in oil prices.

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Speaker 1: Data showed again American economy growing less than estimated at

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Speaker 1: the beginning of the year. They're also signs that inflation

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Speaker 1: picked up now. Among companies moving on corporate news, Facebook

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Speaker 1: jumping in leven percent. It reported sales and profit that

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Speaker 1: Blue Pass handless estimates business meant work in video ads

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Speaker 1: on its main mobile app. Also, Sat Jude Medical Surging

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Speaker 1: About or sat Avid Labs agreed to buy it in

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Speaker 1: a deal that values the maker of heart devices at

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Speaker 1: twenty five billion dollars. And once again as we check

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Speaker 1: a futures, this morning, despite a number of these merger announcements.

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Speaker 1: This this Thursday morning, S and P futures right now

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Speaker 1: they are down thirteen points, that's down seven tenths of

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Speaker 1: a percent down. Futures down at one hundred thirty nine,

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Speaker 1: and the nast day futures fifteen points lower. And we

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Speaker 1: update the markets for you every fifteen minutes during the

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Speaker 1: trading day right here on Bloomberg Radio. I'm John Tucker.

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Speaker 1: Not back to Mike Bloomberg Surveillance. Hey, John, it's a

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Speaker 1: forty eight on Wall Street. The following is from Bloomberg

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Speaker 1: View Opinions in comment Jerry from Bloomberg Columnists, I'm Jonathan Bernstein,

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Speaker 1: a columnist from Bloomberg View. Ted Cruz has named Carly

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Speaker 1: Fiorina as his running mate three months before the Republican

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Speaker 1: Convention and with several states yet to hold their primaries.

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Speaker 1: It's less a strategic move than a desperate one. Fiorina

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Speaker 1: has no government experience and lost badly in our only

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Speaker 1: previous attempts for elect of office. She brings no constituencies

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Speaker 1: or Republican aligned interest groups with her. Her national favorability

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Speaker 1: numbers have been consistently below water, adding a Scott Walker

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Speaker 1: or Marco Rubio to his ticket would have been a

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Speaker 1: strong sign that the party was still resisting Trump and

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Speaker 1: the supporting Cruise was the only way to do so.

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Speaker 1: Adding fi Arena, it's showing a weekend besides good presidents

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Speaker 1: as well as good presidential candidates resist the urge to

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Speaker 1: make important commitments in order to win news cycles. Bottom line,

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Speaker 1: Cruise needs to win in Indiana this coming Tuesday, but

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Speaker 1: he's still behind in the polls right now. It's hard

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Speaker 1: to see how this gambit changes anything. I'm Jonathan Bernstein.

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Speaker 1: For more view, please go to Bloomberg View dot com

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Speaker 1: or view go on the Bloomberg terminal. This has been

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Speaker 1: Bloomberg View. Bloomberg View commentaries can be heard hourly weekdays

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Speaker 1: on Bloomberg Radio. Well, it has been a very busy day,

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Speaker 1: David Gura, a lot of deals, uh, And we were

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Speaker 1: just talking with Nerman arvisch about business investment being a

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Speaker 1: little light and then we get some today China Eastern

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Speaker 1: Airlines announcing it to kind of fifteen bowing seven eight seven.

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Speaker 1: Boeing says they're valued at about forty eight forty at

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Speaker 1: four billion dollars at the list price. Maybe they get

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Speaker 1: a discount UM China Eastern also helping Europe out. Mario

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Speaker 1: drag on the phones call now get a get a

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Speaker 1: cheap now the twenty Airbus A three fifty planes. And

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Speaker 1: then the big news for the folks up in Canada,

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Speaker 1: Delta gonna buy seventy five at least seventy five of

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Speaker 1: the new Bombardier smaller jets. So uh some big news,

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Speaker 1: big investments in the airline industry today and that has

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Speaker 1: those stocks on the moon Bowing shares down nine tenths

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Speaker 1: in pre market trading. We're still about forty minutes away

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Speaker 1: from the opening of the markets, but Bombardier gets an

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Speaker 1: almost eleven percent gain out of the news that Delta

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Speaker 1: is coming on board with them. One of the weirder

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Speaker 1: stories this morning price Line. The CEO of price Line

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Speaker 1: has been cashiered, as they say, for a they say

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Speaker 1: a relationship with a non direct report. That's all they're

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Speaker 1: telling is Darren Houston has resigned. They are that they've

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Speaker 1: put a new, uh well an old person into the job.

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Speaker 1: The former CEO, Jeffrey Boyd, will take over on a

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Speaker 1: short term basis. Uh so UM price Line shares right

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Speaker 1: now down one point four percent they started training again,

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Speaker 1: the spokesman here for for Price Line commenting this resignation

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Speaker 1: was not related in any way to the company's operational

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Speaker 1: performance or financial condition. No relation, no, no issues related

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Speaker 1: to accounting or financial reporting either. Again, the spokesman for

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Speaker 1: Price Lines saying there on the Bloomberg story, and of

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Speaker 1: course we've got the big deals, Abbot buying a St.

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Speaker 1: Jude's medical St Jude up percent. But what's been interesting

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Speaker 1: is to watch Abbot shares go down as the hall

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Speaker 1: with the journalists has been underway, journalists and investors has

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Speaker 1: been underway. Now. Abbott said that they would uh that

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Speaker 1: this would hurt earnings in two thousand and sixteen through

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Speaker 1: two thousand eighteen, but in two thousand twenty would add

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Speaker 1: uh five million dollars and what they call synergies. But

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Speaker 1: apparently short term investors are looking, you know, kind of

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Speaker 1: down the road, or they're not looking down the road.

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Speaker 1: So a lot going on in the markets today, and

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Speaker 1: yet we're still seeing as we keep mentioning futures lower

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Speaker 1: in the United States, S ANDP features out by fourteen

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Speaker 1: now seven tenths of eight percent, and Europe down the

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Speaker 1: stock six hundred off by call four points one one percent.

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Speaker 1: All that being blamed on Japan and the Bank thereof

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Speaker 1: not doing any They were supposed to stimulate the economy

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Speaker 1: and they did they did not do so. They did

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Speaker 1: not add any statements, some saying that they're going to

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Speaker 1: UH sooner or later, and they may be forced to

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Speaker 1: because the end at one oh eight thirty six is

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Speaker 1: by about three percent weaker against the dollar against the euro,

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Speaker 1: about the same trading for one two ninety two. The

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Speaker 1: big question is did the Bank of Japan disappoint or

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Speaker 1: were people leaning the wrong direction? And our expert on

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Speaker 1: that is John Vale with Nico's Securities. John, a lot

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Speaker 1: of people leaning the wrong way when when the Bank

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Speaker 1: of Japan announced that that they weren't going to do anything,

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Speaker 1: it appears yes, uh, and we were surprised to buy it. Uh.

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Speaker 1: And obviously the stock market and the currency market reacted

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Speaker 1: UH negatively to the surprise. I don't really know why,

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Speaker 1: to be honest, UH, he didn't go ed. Usually he's

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Speaker 1: on the more proactive side. There's a chance that he's

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Speaker 1: waiting for UH the G seven summit to happen in

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Speaker 1: Japan in May UH and and doing something after that.

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Speaker 1: As a sign of Japan's leadership after the summit is over. Uh.

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Speaker 1: But yes, I do think we have more easing ahead.

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Speaker 1: It's just that this time he didn't feel it was

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Speaker 1: the right time to do so. In your note you

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Speaker 1: said that the bo J should proceed on a logical

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Speaker 1: and well telegraphed fashion. We've seen that happen here. Um,

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Speaker 1: it's mixed this time. Yeah. He It's always hard to

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Speaker 1: know what to say about this, but I tend to

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Speaker 1: think that Kronasan and the b o J should be

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Speaker 1: a little bit more forthcoming going forward. His reputation has

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Speaker 1: been to shock the market. He's from the foreign exchange

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Speaker 1: background at the Ministry of Finance where and he thinks

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Speaker 1: that the only way to actually get results is to

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Speaker 1: actually shock the market. Um. But this I think going

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Speaker 1: on going forward, I think it's got to be a

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Speaker 1: little bit more forthcoming, although it's very hard to do.

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Speaker 1: It's very hard to do because there's so much pressure

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Speaker 1: on him. Um. Frame for us, what's happening in the

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Speaker 1: economy in Japan as a result of stimulus are two

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Speaker 1: separate stories on the Bloomberg today. They really come down

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Speaker 1: to the way you define things. The story that notes

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Speaker 1: that since Corona began his stimulus efforts, the pace of

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Speaker 1: lending has picked up significantly. And there's another story that

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Speaker 1: said the pace of lending has picked up, but basically

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Speaker 1: from nothing, and the the amount of lending in the

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Speaker 1: economy is very low because there's not a lot of

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Speaker 1: demand for businesses don't want to borrow to invest, and

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Speaker 1: that banks are seeing their deposit base rise much much faster,

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Speaker 1: their their liabilities much much faster than any assets. So

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Speaker 1: is stimulus is is abbynomics working or not? Well, it

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Speaker 1: is working, but Japan is not an emerging market. I mean,

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Speaker 1: it's a very mature economy. We shouldn't expect miracles. It's like,

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Speaker 1: uh see, if you're in the college counseling process, like

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Speaker 1: I am with my son right now. Uh and you

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Speaker 1: promise your kid was saying, your kids, it's getting b

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Speaker 1: pluses and their prospects aren't very good for for doing

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Speaker 1: very well in your college. Uh selection, and your parents say, okay,

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Speaker 1: we're gonna get you into Harvard, all right, And so

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Speaker 1: if you work hard, it's stilus there. And that's what

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Speaker 1: I've been obviously. It's all about it is like trying

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Speaker 1: to get companies to borrow more and try to get

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Speaker 1: everybody more excited. Uh. And it's working to some degree.

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Speaker 1: But instead of getting into Harvard, you get into some

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Speaker 1: other Ivy League school and you should be proud of that.

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Speaker 1: Getting into an Ivy League school might not be Harvard,

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Speaker 1: but it's an Ivy League school. And and inflation used

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Speaker 1: to be zero in Japan for economics. Now it's core

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Speaker 1: inflation is now unning close to one percent. So it's uh,

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Speaker 1: they've definitely made progress. It's just people expect miracles and

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Speaker 1: that's wrong. Demographic still huge this year. It is. I mean,

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Speaker 1: it's I don't think it's a defining issue, but it's

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Speaker 1: definitely a headwind. They're counteracting it with technology and robots

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Speaker 1: and some immigration. Uh, so it's it's uh difficult for

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Speaker 1: a mature economy. John Vale is with us from Nico Securities.

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Speaker 1: We're talking about the Bank of Japan will continue, Uh

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Speaker 1: that question. I got a question about this whole Ivy

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Speaker 1: League because there's a anyway we'll talk about that coming

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Speaker 1: up in just a moment. Bank of Japan certainly disappointed

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Speaker 1: no one more than investors in Japan. The Nike finishes

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Speaker 1: down on the day by three point six percent. That

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Speaker 1: six and twenty four points. Big run up in the

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Speaker 1: nick coming into the decision is people perhaps spending on

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Speaker 1: a little bit more than they got right now, that

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Speaker 1: declined spreading throughout the world. SMP futures off by thirteen.

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Speaker 1: We're a half hour away from the opening of trading

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Speaker 1: here today. Down futures down a hundred and thirty three.

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Speaker 1: This is Bloomberg surveillance on Bloomberg Radio worldwide. This is

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Speaker 1: Bloomberg surveillance. So some cross wires going on on both sides,

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Speaker 1: both the Fed and the marketers having a hard time

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Speaker 1: understanding each other. No one advocates a regressive tax system,

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Speaker 1: and yet that's what the United States has wound up with.

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Speaker 1: Most forward inflation reputations are still lower than where they

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Speaker 1: were at year end, and even at current levels they're

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Speaker 1: quite low. Bloomberg Surveillance your link to the world of economics, finance,

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Speaker 1: and investment on Bloomberg Radio. Good morning, It's nine o'clock

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Speaker 1: on Wall Street Time. Michael McKee. David Gura is with me,

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Speaker 1: sitting in for Tom Keene, who continues on his vacation.

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Speaker 1: We're still playing the wear in the world. Is Tom

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Speaker 1: Keen game, and so far nobody has managed to locate,

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Speaker 1: which is probably a good thing because he would be

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Speaker 1: if if tourists were all over him trying to get

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Speaker 1: his autograph while he is trying to relax. The Forex

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Speaker 1: brief brought to Interactive Brokers. Winner of FX Weeks two

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Speaker 1: thousand fifteen award for the best Retail Forex trading platform

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Speaker 1: is that ib AT I b k R dot com

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Speaker 1: slash four X. Well, if you're gonna talk four x today,

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Speaker 1: you're going to talk yen. The Japanese currency is three

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Speaker 1: percent stronger against the dollar one O eight thirty nine

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Speaker 1: and pretty much the same percentage against the euro one.

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Speaker 1: It's not the only big mover on the day, much

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Speaker 1: UH centers on central banks. The New Zealand Central Bank

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Speaker 1: also on hold today and that currency has strengthened one

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Speaker 1: point at six percent. And we were talking about this yesterday,

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Speaker 1: David and on Blueberg surveillance on television. We're watching oil

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Speaker 1: prices rise. West Tech is over forty five heading for

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Speaker 1: one now and Brent crude crossed forty seven yesterday, seven fifty.

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Speaker 1: Who may not be long before they get to fifty

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Speaker 1: dollars And you can hear the applause from north of

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Speaker 1: the border, up in Canada all the way down here

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Speaker 1: in New York. A Looney continuing to gain strength, up

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Speaker 1: another quarter of a percentage point today. That is the

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Speaker 1: Bloomberg for X report. Now we turn to the busiest

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Speaker 1: man at Bloomberg today, Dave Wilson. Um. The good news

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Speaker 1: for our clients, the bad news for you is that

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Speaker 1: we never run out of red ink for those red

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Speaker 1: hot headlines on earnings on corporate news. It's just been

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Speaker 1: an amazing morning. Absolutely, it is the busiest day of

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Speaker 1: first quarter earning season today. And on top of that,

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Speaker 1: you have what might be called to take over Thursday

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Speaker 1: going on. Uh. Let's start with the earnings, specifically Facebook,

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Speaker 1: the stocks up about eleven and a half percent in

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Speaker 1: early trading. The social networks first quarter profit toped analysts,

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Speaker 1: average estment and Bloomberg survey by the widest margin in

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Speaker 1: about two years. Revenue also beat projections, and Facebook moved

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Speaker 1: to solidify CEO Mark Zuckerberg's control by proposing a class

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Speaker 1: of non voting shares. Uh. Now, let's turn to deal making.

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Speaker 1: You've got St. Jude Medical, the maker of heart devices,

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Speaker 1: accepted a twenty five billion dollar takeover offer from Abbot Labs. Now.

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Speaker 1: Abbott said it has the financing to buy St. Jude

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Speaker 1: and the medical device testing maker A Layer, which the

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Speaker 1: company has agreed to purchase for five point eight billion

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Speaker 1: dollars a leer higher on that news. On the other hand,

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Speaker 1: Abbot's down about nine percent in early trading. UH Metivation UH.

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Speaker 1: This is a developer of cancer therapies and the stocks

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Speaker 1: up seven percent. It's become a target for Francis Santa Fee,

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Speaker 1: which meant an unsolicited offer of nine point three billion

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Speaker 1: dollars in cash. So far it's been spurned, and that's

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Speaker 1: why Santa Fee went public with the proposal. Ab Vy

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Speaker 1: is down three and a half percent. Maker of the

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Speaker 1: heart right to Druke Humera agree to buy a developer

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Speaker 1: of cancer treatments. Stem Centrics is a closely held company.

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Speaker 1: Deal that at five point eight billion dollars. And then

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Speaker 1: one more deal text Torah, which is a provider of

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Speaker 1: internet based software for the construction industry. This stock is

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Speaker 1: up thirty and a half percent. Company agreed to a

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Speaker 1: six d and sixty three million dollar takeover by Oracle. UH.

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Speaker 1: Some noteworthy earnings really quickly here Bristol Myers SQUIB up

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Speaker 1: two and a half percent their first quarter profit beating estimates.

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Speaker 1: They raised their full year earnings forecast as well. Sell Gene.

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Speaker 1: On the other hand, of Biot Technology Company down two percent.

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Speaker 1: They cut their earnings estimate for next year to reflect

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Speaker 1: a stronger dollar. Ford Motor up one and a half percent.

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Speaker 1: They're adjusted first quarter earnings sixty eight cents to share,

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Speaker 1: beat the average estimate by twenty cents. The online payment

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Speaker 1: company PayPal up three percent, first quarter results being estimates,

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Speaker 1: MasterCard down one percent as first quarter expenses, whereas twenty

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Speaker 1: five percent, Via Calm down three percent. There a new

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Speaker 1: UH fell for the fifth straight quarters to company that

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Speaker 1: owns MTV and Comedy Central, among other things, and Syman

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Speaker 1: tacks down eight and a half percent. The Maker Security

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Speaker 1: Software said President and CEO Michael Brown will leave and

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Speaker 1: their fiscal fourth quarter profit and revenue trailed estimates. Tay Wilson,

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Speaker 1: thank you very much. That's Bloomberg Stocks saitor David Wilson

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Speaker 1: joining us here. We gonna bring back in John Valley's

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Speaker 1: the chief global strategist at Nico Asset Management. Talking about

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Speaker 1: the Bank of Japan it's decision we should do a

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Speaker 1: surveillance correction here I said the securities and John you

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Speaker 1: you corrected me going back, you heard it here? All right, Chan,

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Speaker 1: let me ask you about the market reaction that we've

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Speaker 1: seen here and what it tells us about the faith

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Speaker 1: that the markets are putting into central banks right now. Well,

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Speaker 1: they're key, especially for form exchange traders, and uh, they're

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Speaker 1: definitely quick to pull the trigger. They don't think about

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Speaker 1: the fact that it Bank of Japan could do something

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Speaker 1: even larger in June. Uh. So, I think it's over

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Speaker 1: reaction in the markets. To be honest, is so is

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Speaker 1: the Bank of Japan uh pushing on a string in

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Speaker 1: terms of trying to gin up demand for credit in

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Speaker 1: the market that doesn't want it. Well, as I hinted earlier,

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Speaker 1: the goal of abonomics is to try to incentivize people

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Speaker 1: to borrow. Now, maybe it's impossible, I don't think so,

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Speaker 1: for instance, even in Europe or getting companies to borrow.

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Speaker 1: So that's a pretty good example that you can get

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Speaker 1: a mature sort of economy that's a little bit uh

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Speaker 1: depressed in in its its psychology to actually start growing again.

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Speaker 1: Um So, I think there's still hope. I don't think

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Speaker 1: it's pushing on the string. And for instance, the statistics

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Speaker 1: came out also that after the negative interest rate policy,

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Speaker 1: which everybody who pooed so much, it actually did stimulate

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Speaker 1: bank lending to UH individuals, and that mortgage demand is

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Speaker 1: actually quite strong now because more mortgage rates have have fallen.

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Speaker 1: So it is happening, and if it happens anywhere, a

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Speaker 1: lot of it's going to actually happen in the real

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Speaker 1: estate market. I think it's already some real estate prices

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Speaker 1: are starting to rise quite a lot of commercial, commercial

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Speaker 1: and some luxury areas. But for the middle class it

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Speaker 1: really hasn't really risen that much yet. But I think

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Speaker 1: it actually could start rising as people see that it's

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Speaker 1: almost they get paid maybe to to borrow to buy

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Speaker 1: a house. Maybe in the future, who knows. What did

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Speaker 1: you make of the central part of this Bloomberg story

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Speaker 1: from a few days ago, indicating that the Bank of

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Speaker 1: Japan was considering here offering a negative rate on some

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Speaker 1: loans to commercial lenders obviously didn't happen this time around,

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Speaker 1: but sort of incentivizing the commercial banks to lendon. I'm

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Speaker 1: really really surprised that they didn't do that because that

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Speaker 1: would have really helped clear some of the air. One

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Speaker 1: of the reasons why the negative industrate policy was considered

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Speaker 1: to be uh questions they flop, but that it did

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Speaker 1: hammer bank shares because they were afraid of what would

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Speaker 1: happen to their profits. Now, if you did sort of

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Speaker 1: what the ECB has been doing in terms of giving

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Speaker 1: some negative rate uh lending to banks, that would have

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Speaker 1: alleviated that and the stock prices up, and that would

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Speaker 1: have moved the stock market up. That would have helped

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Speaker 1: the wealth effect and stimulate consumption. So I don't know

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Speaker 1: why they didn't do it. Maybe they're not ready. Maybe

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Speaker 1: they have now decided that they really want to be

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Speaker 1: really well prepared before they do anything, and I think

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Speaker 1: that's probably wise. And uh there's also a very small

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Speaker 1: number of people who actually are deciding the policy within

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Speaker 1: the Bank of Japan, and they might not be able

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Speaker 1: because they wanted the surprise factor right here tofore. That's

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Speaker 1: another reason why I'm I mentioned earlier that they should

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Speaker 1: be a little bit more open and telegraphing. Is that

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Speaker 1: that so they can plan these things better and make

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Speaker 1: sure that the banks understand how they're going to proceed,

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Speaker 1: Because like I mentioned after the negative indust rate policy,

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Speaker 1: there was a lot of confusion. The banks were shocked

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Speaker 1: and everybody was a bit shocked, and it just wasn't

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Speaker 1: really the market was not prepared for negative interest rates,

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Speaker 1: John Vale, Nico Asset Management. Than you get that correct.

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Speaker 1: I don't want to put him back on the south side. Uh.

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Speaker 1: Thanks for joining us, David. I'm gonna get out ahead

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Speaker 1: of one. It's not really me, but I'm looking here

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Speaker 1: at looking through the stock market and DreamWorks the shares

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Speaker 1: in the premarket halted this on the heels of announcement

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Speaker 1: right ahead of it. Dream The NBAC Universal announces DreamWorks

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Speaker 1: Animation acquisition, so take over Thursday, as Dave Wilson announced,

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Speaker 1: it is happening. I'm looking for the terms here. Under

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Speaker 1: the terms um an equity value of repoint a billion.

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Speaker 1: DreamWorks shareholders will receive forty one dollar in cash for

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Speaker 1: each share of DreamWorks Animation common stock. So it looks

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Speaker 1: like it's an all stock deal as near as we

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Speaker 1: can tell, and values DreamWorks as you point out, at

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Speaker 1: three point eight billion dollars UM. We're just barely seeing

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Speaker 1: some reaction to Comcast shares. They're down two tents of

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Speaker 1: a percent. Watch for more news in that regard. DreamWorks

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Speaker 1: is not trading at the moment. And again, um, the

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Speaker 1: deal is going to put Jeffrey Katzenberg in charge of

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Speaker 1: something called DreamWorks New Media. I guess a news it

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Speaker 1: will be a division of Comcast. And this is something

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Speaker 1: he's tried to do before, to offload uh, offload Dreamwork.

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Speaker 1: So in achievement there for Jeffrey Kathenberg. Alright, this is

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Speaker 1: Bloomwork surveillance on Bloomberg Radio, and you cannot turn us

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Speaker 1: off because Lord only knows what's going to happen next

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Speaker 1: in the next five minutes here on Bloomberg Radio. All right,

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Speaker 1: let's check in with Michael Varr. Now I'll get the

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Speaker 1: latest world and national headlines. Michael, Mike David, thank you

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Speaker 1: very much. The International Committee of the Red across this

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Speaker 1: warning that the northern Syrian city of Aleppo is on

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Speaker 1: the brink of a humanitarian disaster as a result of

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Speaker 1: renewed fighting. Syrian Monitoring Group and the First Responders Team

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Speaker 1: say in the past twenty four hours, at least sixty

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Speaker 1: one people have been killed, including dozens killed in air strikes,

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Speaker 1: a residential building and an internationally supported hospital. President Obama

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Speaker 1: says the movie The Big Short was wrong. Wall Street

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Speaker 1: has changed. President Obama, speaking to the New York Times,

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Speaker 1: says he sees a major shift in how Wall Street

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Speaker 1: is regulated. The Big Short was about the two thousand

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Speaker 1: and eight economic meltdown. House Committee last night narrowly approved

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Speaker 1: a measure that would require women to register for the

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Speaker 1: military draft. Global News twenty four hours a day, powered

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Speaker 1: by our journalists. I'm Michael Barr, Mike David. Thank you

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Speaker 1: very much for the breaking news in the last moments.

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Speaker 1: DreamWorks Comcast deal is going through. Comcast pays forty one

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Speaker 1: to share values DreamWorks at three point eight billion dollars.

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Speaker 1: Market drivers brought to you by Elbow Beach Bermuda in

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