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00:00The Closing Bell, Bloomberg's comprehensive cross-platform coverage of the U.S. market close, starts right now.
00:09And right now we are two minutes away from the end of the trading day.
00:13Romain Bostic alongside Katie Greifeld taking you through to The Closing Bell with a global simulcast.
00:18We're joined right now by Tim Stenevich in the radio booth.
00:21Nora Melinda in today for Carol Master.
00:23Welcome to our audiences across all of our Bloomberg platforms,
00:26including our partnership with YouTube's Tim Stenevich on a day where the market decidedly on the back foot,
00:32a little bit of a breather from the record run that we've had.
00:35Yeah, a little bit of a breather.
00:36We're off our worst levels of the day, but still seeing some red on the screen.
00:40Interestingly enough, it's risk on when it comes to crypto.
00:44A new record for Bitcoin up above $118,000 per Bitcoin.
00:49So you're not concerned about trade tensions.
00:51Risk on, but we're seeing a market that ended lower.
00:54I'm looking at financial stocks being the worst performing sector in the S&P 500 as we close on this Friday.
01:00Yeah, we'll see how that changes next week, though.
01:02Of course, we know it's bank earnings kicking off.
01:04We have the six majors to get through.
01:06And it feels like, I mean, you take a look at the sell side, you take a look at investors.
01:10They seem to agree that the stars are aligning for financials.
01:14Yeah, the stars are certainly aligning for financials, which, of course, at least as a group,
01:17we're trading near those record highs coming in to this week.
01:21And don't forget, we also get Netflix as well.
01:23So a little bit of a preview, maybe, onto the consumer side of the equation.
01:27And I do wonder about expectations, Tim and Nora, this idea that are investors prepared for the best?
01:32Are they prepared for the worst?
01:34Or are they just kind of somewhere in the middle?
01:36I think they're somewhere in the middle.
01:37I mean, look at the expectations a few months ago about what tariffs would do.
01:41That really hasn't materialized.
01:42And now the commentary seems to be, OK, well, just wait a few more months and we'll see it materialize.
01:47All right, well, we get the closing bells here in New York.
01:50A bit of a mixed day and a bit of a mixed week for financial markets coming off record highs
01:55or near record highs with the Dow Jones Industrial Average closing out the day lower by almost 300 points
02:01or about six-tenths of one percent.
02:03That's going to amount to a drop on the week of about one percent.
02:06The S&P 500 down 21 points on the day or three-tenths of a percent.
02:11That's also going to lead to a loss on the week.
02:13The Nasdaq Composite and the Nasdaq 100 each losing around 40 points or so on the day,
02:20both closing out the week in the red.
02:22And there's the Russell 2000, which had been the outperformer for the last few sessions.
02:26Now the underperformer down six-tenths of one percent for the day.
02:31A decidedly down...
02:32Excuse me, 1.3 percent on the day.
02:33Excuse me.
02:34Oh, that's even worse.
02:35Yeah, even worse.
02:35Aw.
02:36Decidedly down day for the major indexes.
02:40And look at that.
02:41The S&P 500, only 110 stocks in the S&P 500, moved higher today, 390 declined.
02:47All right, let's take a look at the sector level.
02:49You did manage to see some green, of course, when it comes to energy,
02:53when it comes to consumer discretionary, managing to poke into the green.
02:57This is a prettier picture, actually, than when I checked this board at about 940 this morning.
03:01And you had every single sector in the red.
03:04But still, overwhelmingly, financials, health care, materials, consumer staples, all dragging this index down.
03:10Okay, I managed to find some gainers today.
03:12I want to start with Levi Strauss.
03:14The share is higher by 11.3 percent today.
03:18They hit the highest level in more than a year.
03:20This after the company came out yesterday and boosted its net revenue forecast for the full year.
03:25A big question a lot of investors had was what has been and what will be the impact on the company from tariffs.
03:31Yes, Harmeet Singh, the company's CFO and chief growth officer, he told our Bloomberg News team that it'll be about $25 to $30 million through the end of the year.
03:40We actually had him on our program a few hours ago.
03:44And I asked him specifically about moving production, moving manufacturing to the United States,
03:49because that is exactly what the president wants to see.
03:51It doesn't matter if it's in Vietnam or China or Indonesia or where it is.
03:54The president wants to see it here in the U.S.
03:55He was decidedly firm in his answer that is not going to happen for Levi Strauss.
04:01He mentioned that 98 percent of apparel that comes to the United States and that is sold in the United States is actually manufactured outside of the U.S.
04:07And they're not going to change that here when it comes to Levi Strauss, though.
04:12He's still working through tariffs and even making last minute changes based on the news that he hears from the president,
04:17even up to late last night after earnings, he mentioned.
04:21Also, Performance Food Group shares surged higher today.
04:24Bloomberg News reported that the company has attracted takeover interest from U.S. Foods Holding Corp.
04:29It's a potential deal that would create a food distribution company with a combined sales of roughly $100 billion.
04:34This is according to people familiar with the matter.
04:36Shares higher by more than 4.8 percent today.
04:40The company would become the number one U.S. food service distributor with 18 percent of the $371 billion market.
04:48This is according to Bloomberg Intelligence.
04:49We should note there is no certainty that these deliberations will lead to transactions and representatives for U.S. foods and performance food declined to comment.
04:59And finally, this is a former micro cap that is now a small cap after today's move of close to 40 percent.
05:07Unusual Machines.
05:08It's a drone tech company based in Florida and drone related firms rallied today.
05:14This after Fox News reported that Defense Secretary Pete Hegseth has issued orders to ramp up production and deployment of drones.
05:21Unusual Machines higher today by close to 40 percent.
05:24Josh Sullivan over at Benchmark says the memo focused on three main goals, bolstering U.S. drone manufacturing,
05:30delivering thousands of low cost drones to the military and integrating drone operating into training.
05:36Once again, shares higher by close to 40 percent, Nora.
05:39Well, we've got a few names in the red, as expected, with the market closing lower today.
05:43I'm looking at shares of PayPal.
05:45That was the worst performing stock in the S&P 500 today.
05:48And we're seeing a lot of other fintech companies like Block and Affirm also falling as well.
05:52And that all came after a headline that we saw earlier as we were heading into the close with J.P. Morgan telling that these fintech companies,
06:00that they're going to have to pay up for customer data.
06:02That could amount to hundreds of millions of dollars for access to customers, bank account information.
06:07So we're seeing those fintech companies falling, but also credit card firms like Visa, MasterCard,
06:13also lower with the move really threatening to upend specifically the fintech sector's business models.
06:19Another stock I'm looking at is Albemarle.
06:21That's ticker ALB.
06:23$8.3 billion company.
06:25It's a lithium producer based in Charlotte, North Carolina, and it was cut to neutral to sell from neutral, excuse me, at UBS,
06:32with its price target trimmed to $57 from 64.
06:35We have the analyst here encouraging investors to, quote, fade the bounce, as he expects lithium prices will remain lower.
06:44And one more stock we have for you, Boyd Gaming, ticker BYD, but not the BYD you're thinking of.
06:49It's a casino operator in Las Vegas, Nevada, $6.5 billion in market cap, and it was cut to neutral from positive.
06:58They're really pointing to the stock's valuation after selling its 5% ownership in FanDuel to Flutter.
07:04And this is all from Susquehanna Financial.
07:07They're also citing the renegotiation of its market access agreement.
07:11All right, let's take a quick check in yields here.
07:13A little bit of a subdued day, but a lot of activity.
07:16When we talk about what happened on the week, a push higher once again across the curve, a second straight week where we see yields move higher.
07:22But more importantly is the complexion of that move, a definite slant to the upside, a steepening, a bare steepening of that curve,
07:29with most, of course, of the sell-off coming on the longer end of the curve, that 30-year yield, up about eight basis points on the day.
07:36And on the week, it's more than nine basis points higher than where it was last Friday.
07:41What have I told you?
07:45Go on.
07:45They're with us here.
07:46Come on.
07:47What if I told you you could go somewhere and get some really good bagels, some really good pizza, some nice steaks?
07:55Okay, you got my attention.
07:57And it wasn't New York City.
07:58Okay, now you lost me.
07:59I just wouldn't believe you, Tim.
08:01You're not going to say, like, Jersey or something.
08:02No, no, no.
08:03No, we can't do that.
08:04Watch out.
08:04Katie's right there.
08:05Yeah, sorry.
08:05Katie is right there.
08:07I just moved there.
08:08Apparently, London food is having a moment.
08:12New York food is having a moment in London.
08:15Kate Crater wrote a story for Bloomberg.
08:18She covers food all over the world.
08:20She's been in London these past few years.
08:21And she writes about some restaurants in London that are really serving a lot of food that we focused on here in New York and that New York has become known for.
08:30And it's actually really, really good.
08:32We're talking steaks, burgers, martinis.
08:34They have apparently got it all over in London.
08:37And it's interesting because they're saying that even though it's a high tourist season here in New York, things are a bit quieter than usual.
08:42I don't really feel that when I'm walking through these streets at all here, Tim.
08:46But apparently that's the case right now.
08:48So, I mean, the idea with this, though, too, I mean, we talk about this idea.
08:51And this is this is just sort of the part of the show where I get to dump on the British, because it's like all their good food.
08:58None of their good food is actually British food.
09:00It's just it's like I mean, you get some great New York food, as you just talked out.
09:03You get some great Indian food and South Asian food in there.
09:07You get all this great stuff there.
09:09What happened to like British food?
09:10I just like it's like peas and toast, the bangers and mash, the fish and chips.
09:15There's some good there's some good stuff there, guys.
09:17Yeah, I remember going to some local food, a local hotel there.
09:20And I was. Yeah, you can get blood sausage.
09:22That's not really up my alley.
09:25That's great for these British people who are enjoying New York food.
09:29That's good. And Brexit hasn't affected any of this.
09:31Not that I know. OK.
09:32Wow. Anyway, do you want to talk about airplanes?
09:35Sure. Talk about airplanes.
09:37OK, let's talk about airplanes.
09:38There's an interesting story on the terminal Delta, apparently, is stripping engines from new Airbus jets in Europe to use them on grounded planes in the U.S.
09:48This is according to Bloomberg reporting.
09:50This. What do you mean stripping from airplanes?
09:52That's exactly what it sounds like.
09:54Yeah, they're stripping the engines off and using them to get those grounded planes up.
09:57You might think. So these are planes they own.
09:59This isn't like the guy who comes down my block to steal, like, you know, carburetors or whatever.
10:04These are brand new planes.
10:05Yeah, brand new planes that they haven't taken delivery of in the U.S. because they don't want to pay the tariffs.
10:10But they have this fleet of grounded Airbus A320s that have these Pratt & Whitney engines that have worn out quicker than they were supposed to wear out because of a metal shavings issue.
10:20Oh, go on.
10:20From Pratt & Whitney.
10:21So what they're doing is they're taking these engines off.
10:24They're throwing them.
10:25They're bringing them to the U.S.
10:25They're putting them on the planes here.
10:28We talked to Sid Phillip about this a little earlier.
10:30He said it's actually a pretty easy thing to do.
10:32You could try it at home.
10:34Well, you like the ingenuity there, right?
10:35I mean, the idea that, you know, when you run into these issues.
10:37Yeah, absolutely.
10:38You know, give them credit there.
10:39And the idea that you can just take those and move them on.
10:41Why not?
10:42Why not?
10:42Yeah, why not?
10:43Do you know what they're doing with some of the tariff to get around some of the tariffs, too, on the planes, right?
10:47Did you hear about this?
10:48No.
10:48I was hoping you'd tell me.
10:50The detour.
10:51Sid told us they can fly some of the widebodies to Japan.
10:54And then they're considered used aircraft to bring them to the U.S.
10:57I mean, Ed Bashan has been very clear that he's not going to pay tariffs on these Airbus planes that are made in Europe.
11:03A good workaround.
11:04Yeah, good workaround.
11:05Yeah, until the president finds out about it, but sure.
11:07All right.
11:07We got to go.
11:08Guys, have a great weekend.
11:10You too.
11:11It's really good to hang up.
11:12Happy Friday.
11:13You too, Tim.
11:13Have a good Friday.
11:14Nice to see you, Carol, for another third day here.
11:17Nora's here all next week, guys.
11:19All right.
11:19Wait, Carol's off next week?
11:21Yeah.
11:21Yes, she is.
11:22All right.
11:22We got to go.
11:23That's going to do it for our cross-platform coverage.
11:24The market closed on Bloomberg TV, Radio, YouTube, and Bloomberg Originals.
11:28We'll be back on Monday, same time, same place.
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