tv Bloomberg Markets Bloomberg June 30, 2015 10:00am-11:01am EDT
greek finance ministers say they will miss today's payment to the finance ministers. makes hishristie longshot presidential bid official. he is far behind at the polls. >> apple joins the streaming today with streaming music. it could change the way you listen to music. ♪ >> good morning. i am olivia sterns. >> i am matt miller. let's go to mike mckee for the june number. mike: it is very high. 101 .4. last month it was 104.6.
we also saw a number over 100 in january. it suggests that consumers's the -- that consumer see things better. we will look at the american view on jobs. it does have an impact on what onple think they happen thursday. it is jobs thursday. americans are more confident in the direction of the economy that may have then. t: a boosting consumer confidence is good names. i want to show you what is happening on the u.s. equity markets. they are bouncing back after yesterday's selloff. it is climbing into the last day of the quarter. the dow fell 350 planes. the momentum of this selloff is picking up. it is a different mood on equity markets this morning. it is up by one third of 1%.
the curious story to me is what is happening on the currency market. the fact that the euro has seen such little action due to the fact that greece is on the verge of leaving the eurozone. it is up a quarter of 1% against the dollar. matt: you would expect more movement was such a volatile political climate. it has been stuck there for a while. we will look at the other stories making news. seen from a number of perspectives, is almost every story. the government is asking for a new two-year ale out program hours before the payment to the imf saying that they will not make it. erik schatzker is in athens. k: the situation is changing fast. the
office of alexis tsipras is
tncluding a deb restructuring. it is time to make he'll marry attempts, and that's what this seems to be. in addition to allowing 1.5 billion euros to the imf the current bailout program will expire at midnight central european time. that is when greece will run out of money. feltmpacts will not be immediately, because the banks are on a mandated holiday, but from a financial perspective greece is out of options. that is why this emergency request is being made. it is not clear how this will play out. whether the european stability , an independent organization established in 2012, needs to establish the request, additionally buying the up toy extra time leading the
referendum on sunday, or it
is in confrontation with the ecb, it can be rejected out of hand. those answers will be coming over the next few hours. this is difficult to assess breaking news. it is difficult to assess the likelihood of success, but it changes the game in athens as we ?o toward what we are not sure. it may depend on a yes or no vote this weekend, or before. matt: erik schatzker is spending time in greece. olivia: other headlines, home prices are growing at a slower pace than expected. home values and 20 cities rose by 4.9% in april from the year before. estimates. the biggest gains were in denver and san francisco where they rose by 10%.
halfio home prices fell by of 1%. general electric has sold off another chunk of finance. they have agreed to by the buyout lending business. the price tag is 2.2 billion dollars. shrinking capital while refocusing the company on big industrial operations. matt: microsoft is getting out of and a net display advertising. aol is taking over the business and will use microsoft bing search engine instead of google. they will hire 1200 microsoft workers. my -- microsoft is selling part of bing to aol. the most expensive hotels in the world might be in san francisco. the average price for a hotel room in san francisco, where matthew miller was over the
weekend, the average price is $397 for a night, up 88 percent. the cost is being driven i the tech boom and the lack of construction. have you ever tried to get a hotel room in napa? i could not find a decent place under $500. matt: you need a b&b. olivia: they were still several hundred dollars. matt: was it worth it? olivia: no, but my friends like to get married in the most expensive places on earth. matt: governor christie barely registers in the national poll, but he is hoping a strong showing in new hampshire could help him. the iranian foreign minister is still confident negotiators can reach a deal on the nuclear program. he is meeting with secretary
kerry hours away from a self-imposed deadline. those stories, and more, coming up on "the bloomberg market day." let's not take a break, let's continue talking about greece. prime minister alexis tsipras practically is daring european leaders to take his country out of the eurozone. olivia: today the markets are a little quieter. u.s. markets are broadly higher. let's bring in a market strategist at j.p. morgan. it is great to have you. you said that the markets are not overreacting to greece because it is already priced in. >> we don't know what will happen, but this has been happening for so long. it is brinksmanship at its finest. alexis tsipras is trying to get the best deal without appearing week. i think the referendum on sunday is a major turning point.
it is a tossup right now where it will go. i'm leaning toward yes vote, meaning the population will say that they want to side with the european and be part of the european union. that will bind alexis tsipras' hands. olivia: you are saying the outcome of the vote will not rattled the markets? betty: it was one of the biggest s&p movements of this year. the market has now bounced back up today. in my mind, a lot of the volatility has been built in because we have been talking about it for so long. just like we talk about the fed every day. i think that is a buying opportunity in the u.s. and europe. i've heard that a lot. especially if there is a no vote. david cote talk was mentioning that. if you can get it, why not.
it doesn't matter greases out of the eurozone to that company. james: we have been saying this will be an increasingly stock pickers market. in situation like this, we have economic volatility and everyone sells at the same time, that is where you can get deals and bargains. matt: there was not much change in the euro. a yes vote does not do much, but if there is a no vote, implying that greece will issue ious in that as, isn't strain? move athe markets did little yesterday, but it is hard to tell. in the short term this will be volatile for europe and the euro , because we do not know the exit plan. the euro might be stronger without greece. it is a mixed bag when it comes to currencies.
olivia: what about asia? we have seen the chinese stock market, the second-biggest in the world. is that a bigger story than greece? james: it probably is. the trade proposals and greece are the big stories, but the shanghai is in correction territory. for fundamental underpinnings, but there aren't many. for us this is a tactical short-term played. a lot is driven by fund flows and the opening of accounts. the chinese citizens have no where else to put their money, and they are now opening stock market accounts. market, theynese can control regulators there whether it goes up or down, right? they have taken a little of the margin out, and have still boosted the market. today we were of 5.5%. isn't that good? james: they're trying to defuse
the bubble. to clamp down on margin requirements, but at the same time they are easing the system and lowering the reserve requirement ratio. they are trying, this is a balancing act that they are trying to forge in the market, and it is difficult. matt: it is an interesting time to be you. liu.a: james the: chris christie becomes 14th republican presidential candidate. we will handicap his chances with john heilemann from all due respect. ♪
olivia: welcome back to "the bloomberg market day." i'm olivia sterns. matt: let's look at which stocks are on the move in the first hour of trading. itbit is getting initiated at lpc by the analyst mark sue. shares are up 7.5%. it is interesting what he has outlined on fitbit. he says there will be a bigger international push and corporate wellness adoption. he says that revenues will grow 83% this year, and 29% next year
. he is saying that it is not a fad. there is a question about the stickiness of fitbit. do you buy it and put it in a drawer. he says that is a challenge, but additional health care monitoring convenience applications will drive engagement and that health-care corporations are spending $7 billion a year on wellness, and that should also support the bid . -- support fitbit. then before since the game today, not even counting today. that is impressive. i want to look at the bond insurers a day after we saw a plunge in the stocks related to the dead of order rico. they're down today, even though we have had a lot of analysts say that the declines were overdone yesterday, and perhaps
it was painting a to die or of the situation in puerto rico. it is down even more than yesterday. did you think of that headline or was it jamie? julie: i didn't even see the headline, it was jamie. i'm glad that you approve. matt: thank you very much. a new report says netflix is on the verge of beating the for the broadcast networks. within a year, netflix will have a bigger audience than abc, cbs, nbc, and fox. they spend less on content, and netflix is growing more than 40% a year.
matt: and then you on "orange is the new black." how do you have time to make that show and the show? a big merger bringing together an insurance broker and professional insurance is firm. they will combine with towers watson in an $18 billion all stock merger. they will be called willis towers watson and will employ $8 billion in revenue. you know there is no such thing as a merger. at partners joining and combination of equals. willis will own the majority, and their name will go first since they are the buyers. music goes online today. they are attempting to take on spotify and pandora. it is free for three months,
then it will be $10 a month for individuals and $15 for families . apple will buy you unlimited access to tens of millions of songs. matt: you get all the songs you need. taylor swift. she is not on spotify and she got apple executives to agree to pay. she is on apple music, not on spotify. it is a free trial. give it a whirl as of 11:00 a.m. you have to upgrade your operating system to get it. we will go back live to athens to figure out what the situation is on the ground. talk about chris christie. can you be the president of the united states after locking up the george washington bridge for 4 hours? olivia: we will be right back. ♪
matt: the greek people are finding out how tough capital controls can be. the lack of cash is impacting everyone from taxi drivers to pharmacists. >> my business? it is down 50%. down,ime it is 50% because we don't have any money. >> they don't take a taxi. an hour for the bus, because they are afraid with they will do with their money. if they have money for five days or more. next week we will be paid by
the government. if we are not, then all the pharmacies will be affected. next week, we don't know if we are in europe are not. we don't know if they will have the money to pay us. we will see. general, ath, was in fewer amount than we were expecting. the problem seems to be worse and worse. the last days, we have the same amount of tourists. they can spend with credit cards, they have the facilities, they have everything prepaid, they can use their credit cards with any amount, but not us. >> we are afraid for everything.
erik: it is not quite so melodramatic as the last comment might lead you to believe. be crunch time for the government, it is not yet crunch time for the greek people. they still have access to some money. the capital controls currently in place allow them to withdraw 60 euros a day. $66. her most of the people it is .nough to live on -- for most of the people, it is enough to live on. everyone is under the same restrictions, so you have to imagine allowances will be made. if the capital controls are in place were couple of weeks, and the banks are closed at the same time, meaning people only have access to that much money or less, it will be very difficult to keep groceries on the shelves of the supermarket. imports will dry out, and drugs
will run short. or have been privations allowing hospitals and pharmacies to make special requests for importing necessities, but that is when things will become difficult. i would say that it has been kind of, businesses usual. matt: a few weeks ago we did a story about a woman who is taking all the money out of her greek bank and putting it into hsbc. think,eryone, i would had the idea, i should take all of my money out of the creek bank. isn't it the case that people ,ave done that to a huge extent and put cash in other places? erik: yes. there is no question. there are still a fair amount of deposits and the greek banking system. a parliamentarian was here, and his spokesman said that he had into the bank.
this is the spokesman for opposition politician had been to the bank to withdraw his 60 euros. even the people who understand best of what is going on, have not taken the money out of the system. there is still a lot of cash in the banking system that people don't have access to. erik schatzker reporting from the ground in greece. olivia: matt, thank you for joining us. matt: i have to leave? olivia: i wish you could stay. matt: i will be back tomorrow. olivia: the latest on the nuclear talks with iran going on indiana. -- going on in vienna. ♪
do without. the first advanced economy to miss a payment to the international monetary fund. they will not make a $1.7 billion payment that was due by the end of the day. talks were rejected that greece would reject proposals offered by creditors over the weekend. we are the ones who say yes to the euro. to say yes, we have to have a valuable solution. the problem was that it was not viable. the bailout program expires at midnight. try minister alexis tsipras said it would be too expensive for european leaders to kick in greece out of the euro. uber is losing millions of dollars as it expands worldwide. generates $470 million in operating losses on $450 million in revenue. the time frame is not clear for
the loss. ofr is growing at a rate 300% annually. the obama administration will raise the wages of millions by requiring employers to pay them over time. this will affect workers making as little as $450 a week. for're not qualifying overtime because they are managers. many work in the restaurant business. according to espn, nicholson wired money to a man who has pleaded guilty to three federal accounts of money laundering. ecclestone has not been charged -- mickelson has not been charged with wrongdoing. come, apple music makes its debut. in 30 minutes, chris christie will officially enter the
crowded race for the white house. will bring you his announcement live at 11:00 a.m. eastern time on bloomberg television. those stories and more, coming up. negotiators were supposed to reach a deal by midnight tonight to curb the nuclear program of iran in exchange for the easing of sanctions. it doesn't look like they are quite at a deal yet. sides are still optimistic. here is the foreign minister of iran earlier today. >> i feel the negotiations have reached a stage where with political will, determination, and work, progress is possible. olivia: the two key obstacles are access for inspectors to nuclear sites, particularly military sites, and when sanctions will be rolled back. iran wants them lifted right away. i want to bring in a or mole
state department official that helped write the original sanctions. he now is at columbia university . jim walsh is a nonproliferation expert. richard, what is your read on what is coming out of the anna? -- out of vienna? richard: this is crunch time. this is a time where there will be final concessions about things like transparency and access, and how sanctions will be rolled back. it would be hard to go home and this they showed they were fighting to the last minute. theya: they like to say are better off with no deal that a bad deal. you say do not let perfection be the enemy of good. richard: the deal we need is one that holds the nuclear program away. they need a deal that provides sanctions relief. that deal can provide us with confidence that iran will not
bomb for a long time, even if it is not the best deal. olivia: do you think this is a good deal worth signing? surprised us in november of 2013, and they surprised a lot of us in april with the framework. i think they will get a deal. they have come such a long way. that means the last few things are very difficult, but they have gotten so far. it is important to all the capitals involve that they will .o what needs to be done this sort of agreement and principle has been there for a while, and i think it is good. i agree with richard that perfection should not be the enemy of good. we have lots of arms control agreements that have served u.s. national security, and i think this will be another. you study states that
are trying to acquire nuclear weapons and then change course. why do you think there's an opportunity or ron to change course? jim: that is the best question i've ever gotten. i think that it fits the iranian case. theyntel tells us that have the capability, but they have not made the decision. they are standing in front of two choices, down the bomb road, or staying away, the road.liferation this is the political chance to put them on a different track. the horses out of the barn, but we can make an agreement to put them on the path, like all the other countries that have started and stopped. richard: we created the incentive structure by providing the sanctions. it is time to use the leverage i giving them comprehensive relief. olivia: you are helping to
tighten the screws from 2011-2030 teen. -- 2013. as proofok at this that the sanctions of worked? matter how the iranians say they're not coming to the table for any other reason than to prove the principle of the nuclear program, they had an opportunity to do that for 10 years, and they only chose to do that when their economy was cratering. olivia: a week ago there is a press conference with president -- where the president backtracking.o be he said no access to military sites. you think this is backtracking or political bluster? richard: there is a debate inside of iran. the deal they have to sign on to
be acceptable in washington and other foreign capitals, it will require that access. they believe that giving that kind of access is a problem. they will have to move on it ultimately. olivia: but would you advise as terms of the pace of sanction release? richard: you use the sanctions leverage.get that if they are going slow and want to ease and, you have to slow down the sanctions. jim: i agree. that is what we have had in that agreement we have been operating on. you do something, i do something . you do more, i do more. that is how you have a successful agreement. olivia: does the deadline matter? pasti think they will slip today, that is what happened in
april, but i don't expect them to go on forever. i don't think any side politically is stronger as the days pass. in the u.s., congress will be on recess buying them more time, but they need to use this deadline to get it done soon. i agree with what he said except for washington. the message has been loud and clear that don't leave early or leave anything on the table. that applies to many different places, but for the u.s. negotiating team it is imperative to prove they were there until the last minute, otherwise there will be a sense to many compromises were made. olivia: great to have you both on. still on "bloomberg market day" it has been a volatile week for china. , couldn'te volatility matter more than greece? we will ask our market experts, next.
olivia: we are one hour into the trading day. it is time to get you caught up on the market action. i want to start with europe. mark is in europe. 270 $5 million was the value on the stoxx 600 yesterday . a further 83 billion have been valued on the stoxx 600 today. .esterday it fell by 1.7% today greece is ready to miss out on a 1.7 billion payment to the ims. the end of the second greek bailout is today. it happens as greece requests a
two-year bailout program from the european stability mechanism . there will be a teleconference call in two hours. the finance ministers will discuss that. the plot thickens. yesterday for the greek bond market. a yield on the greek 10 year rose by the most ever, jumping 420 three basis points and continuing to rise by further 40 basis points to 15.48%. the highest since november, 2012. i wanted to show you what is happening to the euro. it started yesterday by plunging 1.9%. if finished today by 1/10 of 1% higher. gains almost all of those today. this is a fascinating statistic. crisis, thegreek
euro has had its best quarter since march 2011 against the dollar. olivia: the power of stimulus. looking at u.s. stocks we are seeing a rebound from the deep decline from yesterday. the steepest decline for the s&p since april 2014. rebound today, it isn't huge, but all of the averages are up a quarter percent. looking at a bigger macro look, we have heard so many strategists who remain bullish on u.s. stocks in the face of what is happening in china, puerto rico, and greece, and the various bad pieces of news we have gotten over the last couple of days. dated june 20 6, 1 of the things that he is looking at is the gap between u.s. stocks and the german benchmark.
you can see the ratio between the two. he is saying that this cap is 15 percentage points. that is the third whitest on record. widest on record. a couple of reasons he is looking to be optimistic is energy company earnings who are poised for a rebound. he says that households are more willing to spend savings from falling energy prices. dollar risk is less of a concern because it has come down. he says small investors are bearish. olivia: thank you so much. we heard from adam parker, morgan stanley, a lot of people. bullish in the face of volatility. speaking of volatility, stock
markets are bouncing back in the hang seng was up 1%. the shanghai composite rallied more than 5.5% after plunging 5% yesterday. crazy. another story -- another side to the volatile trading in china, a bright spot. regulators have taken note. this wealthid construction in china we have seen, i think it is held up quite well. it all went up limits. 44%. consistent with the first-day performance. this has caught the attention of regulators, that the rate appeal listings that has sidelined a lot of cash that would have stayed in existing listings. the government is considering pushing back some of the ipos, including one from china nuclear engineering until market conditions improve.
this is still being deliberated. david ingles and hong kong. here are some of the top stories crossing the bloomberg terminal. the era of free checked baggage on jetblue is coming to an end. they will charge $25 for checked luggage. proudlys, jetblue proclaimed itself a holdout on fees and allowed one back to be checked for free. southwest airlines is now the only major u.s. carrier not to chart is a checked bag fee. general motors will not have to pay over flooding action switches. a judge in delaware has thrown it out saying the funds could not show that gm directors ignored red flags. blamed groups are more than 100 deaths and the forest recall of more than 2 million cars. the wireless industry has found
out how low it can go. sprint is replacing it $70 promotion with an $80 for motion including unlimited text and data services. a tv ad will feature david .eckham hold onto your cash. that is what bill gross is advising. he tells investors to keep cash in order to avoid ving to sell holdings during a panic. managers are expressing a design in the quiddity increasing losses for investors. cohost me is my for the next hour, pimm fox. pimm fox: one of the things that have happened is that banks and financial institutions have been forced to hold fewer amounts of risky assets, meaning that there is less collateral to
lend out in times of crisis. the point that bill gross is making is that if you have a large number of redemptions, particularly in a mutual fund, the mutual fund will have to sell holdings to meet the redemptions. what happens when it has to sell? it sells its most liquid holdings creating a cascading effect. the cascade begets more selling, and you get people who try to get out their money and can't. olivia: he is not alone. we have heard this concern from everyone and janet yellen and jamie dimon. we are expecting a macroeconomic convergence, the u.s. is tightening while the -- while europe has its pedal to the metal. the study says no, stay on the sidelines.
pimm: perhaps to take advantage of the liquidity price. someone's crisis is your opportunity. it is not to be unsaid, the black box, a mutual fund company, they are working to try to access additional money in times of crisis. example, borrowing money from sister mutual funds and increasing the amount of money that they would be able to borrow against holdings to meet redemption. it is not going unnoticed, and the industry is not responding. as far as investment strategy goes, if you have a situation in greece when you cannot get money out, people with money have an advantage over those who don't. olivia: are looking forward to seeing you in 10 minutes. breaking news out of vienna where the iranian nuclear talks are ongoing.
the u.s. has extended its agreement until july 7 to get more time for talks. secretary john kerry and his iranian counterpart are in vienna trying to hammer out a last-minute deal. ats self-imposed outline was midnight, but they are giving themselves a few extra weeks. the holdups are access to military sites for inspectors and the pace the u.s. will lift economic sanctions. the launch ofg apple music. will it crush the competition? find out, next. ♪
out of the streaming music industry. apple music will be free for three months, then cost $10 a month for individuals and $15 a month for families. will it cause users to jump ship to apple? is this a competition killer? it could be. you cannot ever count apple out. when you think about the fact that this new service will be on default music player millions of devices, in some ways you can't fight that. olivia: are there different features giving it a competitive edge? theory, they will have good interfaces across ipad iphones, and your computers. many services are good at one and not another. apple can negotiate better contracts with labels and get access to music that others can't. we know about taylor swift.
olivia: how about from a ? it isr's perspective the same as spotify for the price point? it will be just as expensive for me. the big thing with jay-z's tidal was that they would have better quality tracks. quality of be the same as itunes. they are selling the culture of music. they're saying they will have playlists generated by rolling or people in, house. they will have a social component. they wanted to be a place that you will learn about music, rather than a place you just listen. apple will take users away from pandora or spotify? or is the market for streaming music growing so quickly that they will not actually take away
market shares, they'll just build out their own? the will be curious after 90 day free trial, how many people cancel their spotify accounts, or how many stay with both. it will come down to how fun is the additional stuff that apple is providing. things thatof the is fun is that there is a human component. will be the at noon apple radio, the flagship 1.tion is called beats the dj will be handling that out of l.a. to start, then they have a dj in london and another in new york. i wonder what the first track will be. olivia: the beatles. >> that is a good guess. maybe taylor swift. hopefully not u2. can't wait to see. 11:00 a.m. eastern.
the polls. he is entering the republican race for president anyway. he will announce his campaign in just a few minutes. the finance ministers says it will miss today's payment to the imf and nobody quite knows what happens next. pimm: while there may be the most viable startup ever, that does not mean it is making money. documents obtained by bloomberg show, they are losing nearly half $1 billion per year. olivia: good morning. i am olivia sterns. fox. and i am pimm we are 90 minutes into the trading day so let's take a look at how they are trading. u.s. stocks are gaining and investors came in -- coming in after yesterday. the dow adds