Bloomberg, Dave Wilson, Elena Papina discussed on Bloomberg Businessweek

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Twelve fifty five ounce and west Texas intermediate crude fluctuated between gains and losses on changed right now at forty five eighty eight a barrel. I'm Charlie pelletan. That is a Bloomberg business flash. You so much Charlie Pellett. You are listening to Bloomberg BusinessWeek carolmassar, my co-host Jason Kelly taking a few days off here during this holiday season. Coming up though, folks, we're definitely on Washington watch. And we are headed seems like four government shutdown, but we'll see a few hours to go and we'll see whether or not the folks in Washington and what happens with the president of. We'll see if we get somebody to move forward. Roles are going to talk all things retail. It is the last holiday weekend before Christmas. So we'll get a check on some of the trends that we've been seeing and what the activity has looked like and also another chapter in the career of DreamWorks founder Jeffrey Katzenberg, Gina who he is really well known to the folks on the west coast also making some inroads in Silicon Valley. We'll tell you exactly what he's up to. And then we've got the investor who made billions betting on macro strategies. Well, known name we're talking about George Soros. He's paring back on that strategy big time. And then we're going to wrap it off at the cost of the twelve days of Christmas. In the meantime, we gotta talk about the fifth day of trading because it's a rough one again, certainly one for the bears. So let's get into it with our team here in our Bloomberg interactive brokers studio Dave Wilson in the house wearing a lovely Christmas. Tie. Is it musical not? Here's a cold. But it's die cut. So you really highlight? The ornaments that way, it is it actually looks like ornaments. Dave Wilson of cars are stock that our Bloomberg news along with Elena Papina not wearing a holiday tied nor a holidays are ugly Christmas sweater. But I'm not gonna be there. Alina Pena's equity markets reporter at Bloomberg news. Dave Wilson, let's start off with you. I think going into the session today were already down about four or five percent and those major equity averages and we're building on that downward momentum. Here we are. And I'm just checking out because you go back to last Friday. We have the possibility of the fifth decline of one percent or more India S and P five hundred and six days, and as it stands, you're you're talking about, you know, the biggest drop over that timeframe since February of this year. So going back to the last time, basically the market. So that had a connection. Right. You might say and this time around was fired because early on I mean, stocks were doing okay because you had a lot of trading related to the expiration of stock index futures index options and also what's going on today. All right on individual shares. Yeah. I mean, the triple witching is it's called which will play out again a little bit at the closing bell. But beyond that, I mean what really struck me is that when you saw stock. Kind of take a hit just how badly the fangs did they were sort of at the front of the pullback you might say. And I'm just looking now Apple's down two and a half percent Facebook four and a half percent lower amazoNcom four and a half percent lower net. Flicks five and a half percent lower and Google's parent. Alphabet down two point six percent. You're looking to class as share so and I'm just saying random here. Just picking one of the things I picked up apple it is down thirty four percent from its high on October third. So it's been a pretty impressive pullback. It certainly has. It's interesting though, you still have Amazon and Netflix higher for the year, but the rasta turn lower especially Facebook down about twenty eight percent as we speak. So they're headed for the first losing full years since the company went public back in two thousand twelve puppy commodity, and on all of this you to or watching the equity markets, what's of interest to you. It is interesting that the best form in sector this year. Well, the is down for the year. But the sector that's down. The lease is utilities. When was the last time this happened? This happened in two thousand eight so all the FANG stocks all the technology mega cabs. I get an absolutely killed during this selloff. And now we are seeing the index under after an index fallen into bear market, the S and P is close. There was a little bit of a optimism early in this session when we opened higher we were up. About one percent at some point. We're back down to the red a lot of uncertainty. Not a good way to end this week before Christmas. So let's just remind everybody that last year in terms of the s&p five hundred we were up about nineteen percent in two thousand sixteen. We're up about nine and a half percent. Go back to two thousand thirteen we were up almost thirty percent. I mean, we have had quite a dramatic run-up Dave as money has been cheap. You certainly have the central Bank by keeping rates low encouraging folks investors, specifically to go into riskier assets as somebody said to me in an interview yesterday saying, you know, we've all gotten a bit spoiled. You can't expect this low rate environment cheap cost of money environment to continue. Absolutely. And you can really break down this year's performance in the stock market to two periods. The first nine months of the year where you basically saw technology companies that consumer discretionary category retailers and a whole lot more. Which led the bull market all the way back to March two thousand nine there were at the forefront and this quarter. It's been all about trying to play defense in the midst of these losses. You mentioned utility stocks. That's one example, real estate is another consumer Staples food beverage tobacco that also fits the theme. So it's been a real transition. And now the question is whether this is something that's just sort of a one shot deal. And we go back to where we were once you get to twenty nineteen or does that really become sort of the beginning of trend suggesting that investors or a little bit skeptical about where the economy goes from here. One thing for certain is we've had more volatility. Maybe it's a little bit above normal. I don't know about that. But we certainly have had more normal volatility. More swings in the market. I mean, if you had I don't know we've into cash at the end of September on the S and P five hundred you would have been up nine percent for the year, which would many people would say that was a pretty good year. And if you think about it, that's absolutely crazy. I just talked to one trader who said he has thirty percent of his per follow following cash right now, that's the most since two thousand eight so people are really taking a step back at this point. And people are looking to see what's going to happen next. If you think about this year on a broader perspective think about how we started this year in late January and February such a dramatic sell off. Right. People lost a lot of money all the retail investors that piloting in January as the markets had did you for a moment? And all those people who feilding later over the summer as the s&p was making you highs in September. They just now crashed again as the markets is down sixteen percents. Senses Hines cameras and not a good way to start the year. And not a good way to end the year. I do wonder Dave in terms of valuations in terms of our earnings outlook at some point do smart investors, just say, well, wait a minute. You know, based on what does earnings outlook is for this particular company. It's pretty cheap right now that may be the bowl and be a cheerleader. But I just. Logically. You have to look at the market that may very well be the case, but you have to kind of take a step back, and look, and I had this chart the other day talking about the drop in the price learnings ratio for the s&p five hundred that the only times basically that you've seen bigger declines are years when there were bear markets own nine hundred ninety four when it was really a bear market for bonds. And stock kinda got caught in that. So you put it all together at the very least, you're not paying the kind of prices. You were going back twelve months for shares here, and hopefully, we'll get some more insight as we get more earnings. Hey, folks, thank you so much Elena. Pena equity markets reporter at Bloomberg news. Dave Wilson are stocks. That are Bloomberg news. He's going to be along later on quick check on the Bloomberg markets by the day, one number that tells us a lot this number today sixty days Japanese, prosecutors rearresting Nissan's former chairman Carlos gone on fresh more serious allegations in financial misconduct. And so it looks like could be a few more days that he's spending in jail. All right right now, let's get a check on.

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