percentage point or two. you see that reflected in s&p futures, up about 1% on the day. not much going on in the treasury market. as a lot ofclines folks unwind some of those haven bids. take a look at what is going on yuan, a little bit stronger than that key seven level. pre-much everything rebounding as the sentiment shifts to a slightly more positive tone than what we had just a couple of days ago. exchangefor the global -- sonali: first we have some news coming in. we have phillips missing estimates, falling $0.04 short of what analysts were looking for. conocophillips here, keeping their dividend steady. shares before market rising a little bit still. we were looking for them to have results better than their peers. all of the oil companies have had a rough quarter. romaine: we are seeing that capex spending coming in pre-much in line with what analysts were much ing -- in pretty line with what analysts were expecting. some encouraging signs off of what is kind of a bad earnings season for big oil. sonali: absolutely. good for everybody else, the. romaine: time now for our global exchange. we will go from des moines, iowa to hong kong, london, and new york. we begin in iowa. the winners from the first democratic presidential nomination contest, we don't know who they are. the iowa democratic party officially delayed those results due to what it called inconsistencies in the reporting process. candidates spoke to supporters while waiting for formal results. have anders: i imagine, strong feeling, that at some point the results will be announced. [cheers and applause] sen. sanders: and when those results are announced, i have a good feeling we are going to be doing very, very well here in iowa. [cheers and applause] romaine: joining us from des moines, david westin, the host of "bloomberg: balance of power," as well as "wall street week." a lot of candidates seem to be declaring victory. winner going to get all of this sorted out? david: we have no idea is the simple answer. we all came to des moines to get the first reaction of real voters of who should be the candidate for the democratic party, and become a not knowing -- and we come away not knowing. there were problems with an app in the precincts to tally these things. as we came to air last night, while we were supposed to be getting results, we got word that there were going to be delays, they had problems, and there were reports of inconsistencies. in the meantime, vice president biden's campaign writing a letter to the democratic party here saying, we want to sit down with you and have something to say about what happens before you release any official results. at this point, we don't know when they will announce results. the irony is these candidates have to go on to new hampshire a week from today, and in between there's the state of the union address that might suck some of the oxygen out of the room. sonali: what are our expectations for what donald trump is going to say? david: we think he's going to declare. victory, basically. . . that he's done an awful lot of good -- owing to declare victory, basically. that he's done an awful lot of good. that he strong economy deserves a little bit of credit for. it is not clear how much he will say. apparently he will talk about middle-class tax cuts. he thinks there are more bilateral trade relationships he wants to work on in the future. one of the big questions, can he restrain himself from crowing a bit on what appears to be an acquittal verdict likely coming down tomorrow? it is unclear how much will be on impeachment as a peers -- as he appears before the very senators in the trial. historically unprecedented. romaine: don't forget to tune into bloomberg later tonight for special coverage of president trump's state of the union address at 9:00 p.m. eastern time. sonali: now we go to asia with the latest on the coronavirus outbreak. the latest cases have top 20,000. hong kong reported its first death, confirming the second fatality outside mainland china. -- joining us is rishaad salamat. what do we need to know about the latest increase in outbreaks? its 20,600 people now confirmed to have this coronavirus. we've got 139-year-old male with underlying health issues dying here in hong kong. but this whole region is on watch, in essence. macau gambling hub, just about 20 minutes by ferry across there, it is closing its casinos for the next two weeks. it would result, according to many studies, and something like revenuesine in during the biggest earner of the year. macau.s confirmed in the economy reeling because of the hong kong street protests, the trade war, and all of the uncertainties that did throw up. china has suffered nearly all of the fatalities in , and the restince in neighboring provinces. people talking about a 3% growth rate for the first quarter, far from the 6% that had been penciled in. sonali: thank you for joining us. romaine: bp surprising investors with a dividend increase, bucking the trend of what had been a relatively bleak earnings season for big oil. >> 2019 is probably one of the strongest years we have seen in both our oil trading and gas trading in the last decade, and you have seen that come through results, particularly upstream, but also in terms of the downstream. romaine: joining us from london is bloomberg's, reordering. a relatively -- bloomberg's annmar hordern. a relatively good earnings report. what was driving this beat today? annmarie: especially when you look at the other big oil majors reporting, it was a good farewell note for ceo bob dudley. tomorrow, bernard looney will take over officially. did big standouts where the net income profit, beating even high analyst expectations. in october, they warned it was to premature to talk about the dividend, but they did raise it slightly. finally, they are trying to get rid of debt. that is the story for these big oil companies. say they are going to do another $5 billion worth of disposal. all of that together was quite a solid report for bob dudley. as i said, he will be leaving after nearly 10 years. really his entire career was marked by the deepwater horizon crisis. bernard looney will be taking the reins tomorrow. he has a big challenge of showing the public that they can move towards a greener transition, but at the same time being able to deliver back to investors the dividend. that's what they care about. romaine: thank you, bloomberg's annmarie hordern. sonali: alphabet reported fourth quarter revenue that missed analyst estimates. numbers on youtube also disappointed wall street. joining us is matt bloxham, bloomberg intelligence analyst. what do we need to know about alphabets big miss? it was the disclosure they gave that analysts have been at muchng for on how they generate from youtube and cloud services, and that was a bit of a mixed bag. youtube generated about $15 billion in revenue in 2019. we don't quite know where analysts were, but there's a clear sense that that was a bit light of expectations. the company was pointing to optimism about their ability to continue to grow that in 2020. cloud services was better received, about $10 billion , which i thinke was encouraging for analysts. that business is looking to take share from the likes of microsoft. of amazon'sbout 1/4 business, so they may need to continue to make investment to gain share. it sets up 2020 quite interestingly for a much bigger round of competition between amazon and google, with amazon going into the core advertising business of google whilst google goes into their cloud services business. i think it is going to be tougher for both of these companies in the market over the next 12 months. sonali: thank you, matt bloxham of bloomberg intelligence. romaine: we end on disney coming out with earnings after the bell later tonight. paul sweeney is the cohost of "bloomberg surveillance" on bloomberg radio and has the key things to watch. for: i think the big issue investors, they are going to focus on the streaming business for the walt disney company. disney is really pivoting from the traditional media model relying upon the cable-television bundle to distribute its programming to streaming. we are talking about disney+, espn+, hulu. those will be the future for the walt disney company. when will these streaming business actually turn a profit? the company has disclosed it is not going to be for another three or four years. investor focus will be on profitability of that business and the subscriber growth. also, investors are going to be focusing on the coronavirus and the impact that is h aving on the theme parks in shanghai and hong kong. we know they have been never could fully impacted -- they have been negatively impacted. finally, the film slate. they've had a great run of movies in theaters. this quarter they had "frozen ii," "the rise of skywalker." what does it look like going forward for the film business that has been such a growth driver? romaine: our thanks there to bloomberg's paul sweeney. sonali: we are trying to figure out how and why tesla has done it. shares have tripled in a little more than three months. the market cap is now about 50 billion more than that of volkswagen. still, tesla's model three is one of the top cars in europe, and even skeptics are giving up the notion that anyone can top tesla anytime soon when it comes to electric car technology. and while, it's been -- meanwhile, it's been a great year for elon musk. according to the bloomberg billionaire index, he's now worth $41 billion. coming up, more on your morning trade and analysis on the markets in today's first take. this is bloomberg. ♪ ♪ romaine: now for the bloomberg first take, where we give you the news and get the trade and analysis of the markets. joining us is vincent cignarella, voice of the bloomberg macro squat on your terminal -- micro squawk on your terminal, and joining us is stuart kaiser, ubs head of equity derivatives research. we've seen the fed inject a lot of liquidity into the system. crisis that china can manage right now from an economic perspective? stuart: they are doing their best. there's a worry that china is now a bigger part of the economy 2003, when sars was a big risk. china has basically doubled their share of trade, global tourism, etc. it's compared to 2003. equities are more expensive now. that has been the most common playbook people are following, but there are important differences. i think people are just looking at the trend in new cases or new illnesses announced. you've got these websites that are basically real-time showing it. people are following very closely. china is doing every thing that can for both the health and a monetary policy perspective to support the markets, but it is a major issue. it is not going to go away in the immediate term. now?i: what happens or stay away dip for a while? stuart: we are still recommending being structurally long chinese equities. the million-dollar question, perhaps quite literally. we are still positive on a structural perspective, but definitely uncertainties around that. our economists took down their growth forecasts in china. our global growth number for the first quarter went to less than 1%, so it is a major impact on the short-term growth story. hopefully, if everything gets resolved, it will be temporary, and you want to own chinese equities in the long run. romaine: if you look at the price action in the markets in asia, a lot of people seem to be shrugging this off, or at least not panicking. vincent: i think markets are starting to take this in stride. selloff esther day -- we saw selloff yesterday the took the dow down. you see all the equity futures up 1%. stuart said it perfectly. do you buy now or later? in the long run, asia is probably the best growth sector over the next couple of years as far as global growth is concerned. regionalchina, but the economic cooperative package that china signed with some 14 other nations, between 30% to 40% of global gdp. it is definitely going to be the place to be. it is going to be good for markets in latam that export raw product, and australia as well. but in the short-term, all global growth is going to go down, and asia is going to suffer the most in the near term. be moreowth is going to adversely impacted, and markets are going to be more adversely impacted. sonali: we had big news yesterday about the oil demand shock. how is that going to feed into commodity markets? stuart: commodity markets have already been the most negatively impacted, whether industrial metals or the price of oil. we have opec, not. there's -- we have opec coming up. there's some discussion that saudi may try to cut production. there are some real structural issues with oil over the long-term. people are short or underweight anyway, so people are looking for excuse to get shorter. we have been supporters of selling upside on oil through the options market. that has largely played out over the last couple of weeks. it is a major issue, but if you look at where our forecasts have changed the most in china, it is much more on the consumption side. a lot of the industrial part of the economy would have been shut down for lunar new year anyway, but the longer you keep people in homes, you are really impacting consumption more directly. romaine: with regards to that, our people sort of reading what is going on with the coronavirus as a supply shock or a demand shock, or both? vincent: i think it's both. you have the demand shock which then makes the supply shock a result. you have oversupply because of lack of demand. do as stuart is saying, we have this consumption issue, but at the same time, in the industrial sector you are looking at a delay. so the second quarter could be a really robust quarter for asia, and china in particular, if this becomes more and more under control. you put it in perspective. it is no small shock when there are 20,000 people infected with coronavirus. diedyear, 600,000 people of the flu worldwide. in context, it is not as big a hit as markets are making it sound. sonali: we were talking about demand shocks, but are there any specific supply-side chocks? -- supply-side shocks? stuart: when opec meets, we will see if they try to do something on the supply side. the biggest supply shock over the last decade is really fracking and shale. that still exists, and that has been one of the structural challenges in addition to esg concerns facing the oil industry. we will see. saudi is generally viewed as the swing producer. what they say is generally going to be what determines that. romaine: earnings season is here. has it been everything you hoped and dreamed for? vincent: i think it has been modest. we will see what disney does today. it's been hot and cold each sector. earnings are definitely going to be the key. the market is reacting positively to what china has done from a central standpoint, throwing the kitchen sink at the virus and at their economy. but at some point, you can't just keep looking at central banks. you have to make money. it has to be earnings. sonali: vincent cignarella, thank you for joining us. stuart kaiser of ubs investment bank stays with us. you can find all of the charts we just used and more by running gtv on your terminal. centcan browse re features and save the charts. gtv . this is bloomberg. ♪ viviana: you are watching "bloomberg daybreak." foregin with a farewell bpce a bob dudley. the giant bucking the industry trend by posting quarterly profit that beat estimates, also raising its dividend. the company is planning $5 billion more in asset sales. bp says it received a nice bump from its in-house energy trading unit. shares of alphabet are falling. google reporting quarterly avenue that missed estimates. search advertising growth slowing down, plus sales numbers on youtube disappointed. to stem the spread of the coronavirus, macau taking new steps. almost four dozen casinos will be shut down for 15 days. so we'll movie theaters and some bars. a casino worker was confirmed to be a new virus patient. that is your bloomberg business flash. romaine: what's going on in macau? kind of a big deal here. we are seeing a lot of hong kong shares of the companies with the most exposure to macau moving wynn, galaxy .ntertainment, mgm they are picking this from february 15 and go 15 days forward from that. you're talking about a potential 15% revenue loss for gaming. gamingy is this a huge hub, but just as a destination for vacation. a lot of people go there and don't necessarily gamble. sonali: not to mention the impact overall. are big global brands. how much does this macau shut down impact their overall waiver new -- overall revenue? romaine: coming up, the iowa caucus, we don't know who the winner is. this is bloomberg. ♪ ♪ romaine: welcome back to "bloomberg daybreak." i'm romaine bostick, in for alix steel today, who is on assignment. the markets are on the decidedly risk on mode. we started out in china as a down day, but quickly rebounded to finish higher. s&p futures, dow jones futures, and nasdaq futures all above 1%. the sentiment also relatively positive. the day, 600 higher on and the csi 300 up as well. ofling returning is a lot people unwind haven bids to yuan . that appeared to satiate investors for now. we are seeing quite a bit of rebound in the commodity space. barrel.ude, $51 a copper, something you don't see everyday, and up move to .6% on the day. if you want to look -- see every 2.6% on theove, day. at $878. some analysts are raising their estimates to $1000 a share. just a few months ago, this was trading just below $300. have analysts believing there will be life on mars. [laughter] romaine: in iowa, they are still awaiting the results of the democratic caucus. glitches have delayed the results, but did you know there was another caucus, a republican one? president trump easily won the republican caucus in that state, where he faced only token opposition. bloomberg spoke to donald trump, jr. he had some comments about former vice president joe biden and what he needed to achieve in that state. butt's where it all starts, it's a dry run for the general. we went to get our teams going. but we want to show the people who took a chance on us in 2016. it was a lot different than. my father was making promises like every other politician. most of those people probably got used to know whenever delivering on those promises. now it is different. a big part of being here is also saying thank you to those people who took a chance on us, and we are going to need them again in the general. kevin: you talk about the policies. usmca is big here. in terms of the economic message from that perspective, how important is trade policy on that front? >> i think it's huge. my father came here and said he was going to do those things. remember for years ago, you can't renegotiate nafta. every economist, democrat, frankly, every republican, no way you are going to be able to do anything about it, and he did , as democrats are pushing the russia hoax. he signed a trade deal with china and other things. you can't get that done. guess what? he used economic tactics to force them to the table, and he gets another thing done as the democrats are pushing the articles of impeachment. that's the difference between the democrats, who are doing nothing, and trump, who is getting things done. delivering on promises despite zero assistance and unprecedented incoming. kevin: there was it, credit presidential candidate -- there was a democratic presence will candidate who is a populist, who your father ran as a populist. bernie sanders, lisbeth warren. what do you say to them -- elizabeth warren. what do you say to them? >> i guess they will say that, but i don't know how you are a populace and you don't go for trade deals that are a huge leap forward. the difference is the american people have seen my father deliver on trade. bernie sanders has been in office for 30 years. we can't name a bill that he's actually done. talk is cheap. action is a different story. we have a track record of a compliment and success where we are actually doing these things. the populism thing i get. that is probably why people let need to pelosi are doing everything they can to screw bernie out of this thing. it's obvious. the last time the democrats rigged a primary, it worked out perfectly for us, so i am more than happy to let them interfere. listeningou were just to donald trump, jr., the trump organization executive vice president, speaking with bloomberg's kevin cirilli in iowa. sonali: still with us is stuart kaiser of ubs investment bank. what do we think about this rise of in terms of what it means for markets? stuart:late last year when warrs pulling well, the markets cared about that. is view is the election really a series of short-term catalysts. we don't think structurally, the election will create a much more volatile year. when you have the caucuses and caucuses andashed primaries in march, dashed caucuses and primaries in march, and then the debate season, with think it will be -- romaine: are you seeing people in your universe really make investment decisions based on this this early out from an election? we have seen in past elections a lot of people with these dark predictions for what the markets will do. we saw that with trump in 2016, obama in 2008, and so on. at the end of the day, everything sort of certs itself out in the market manages to carry on. stuart: i agree with what you're saying exactly. last year, people tried to trade the primaries six months to a year ahead of time. policy grows and the stability of the u.s. government is what is positive for equities. you do need to manage around short-term events, but big picture, equities are a gross asset. they get impacted in the short term by risk. but things should carry on. we are seeing people hedging a bit around these events, but anerwise, i think it's been onward discussion. romaine: potential changes in health care, dental changes in regulation. i interviewed a nobel prize-winning economist to talk about the idea that may folks don't have much to worry about because you have a congress that could still be republican, and that would blunt some of the impact. take a listen to what he had to say here. >> in practice, but i think is that even if bernie sande elizae nominee and win, they will in practice be forced to aoderately progressive program. even if a centrist like biden or amy klobuchar wins -- well, the democratic party moved left, and the policies pursued progressiveor democrats be in distant which will. i don't think it matters which one. romaine: this sentiment seems to be reflected by a lot of people we talk to. . at the end of the day, the economic trajectory of this country doesn't shift you norma from president to president. as long as you have some division in the parties come up people to do work out. stuart: that's subjective right. if you think about a bernie sanders or elizabeth warren candidacy, what's the odds that they win the election and that democrats control the senate that would allow them to do these more aggressive policies, there's a lot of folks in the democrat accent you might not also support some of the policies they have. to your point, the current president is a little bit outside the norm in terms of policy. ingress has managed to rein some of his worst tendencies. it's the institutional structure of the government, not simply the president, that is important. night: i just heard last that the markets would rise if elizabeth warren or bernie the democratic candidacy because trump would win anyways. [laughter] sonali: we have volatility creeping back up here. to what degree does that become a problem? stuart: i think there's two pieces. shorter-term volatility has increased quite a bit on the china news. china volatility is at its largest premium to fair value in more than 20 years. in terms of the election, we are watching how much premium is being placed on hedging a portfolio, and secondly, the medium-term volatility three to six months out. how much is that elevated in anticipation of election events? sonali: what is the big election trade, if there is one? stuart: we have been recommending tactically trading these events using some sort of hedge on the s&p, and when appropriate, owning volatility products three to six months out that don't take a directional are, just benefit if they is volatility -- if there is volatility in the market. romaine: do you still go long duration when yields are where they are now, with the potential to go lower? stuart: it's a good point. they are not doubling down at these levels, but also not pulling back on the recommendation. i don't think we are ready to fade the move, but probably not chasing it either at this point. playing thanks for along here. stuart kaiser of ubs investment bank, thanks for joining us today. don't forget to tune into bloomberg television tonight for special coverage of president trump's annual state of the union address. that begins at nine a clock p.m. eastern time -- at 9:00 p.m. eastern time. sonali: now let's get an update on news outside the business world. viviana hurtado is here with first word news. saysna: cable in hong kong a 39-year-old man with an died with illness has coronavirus. macau ticking new steps to stem the spread of the virus, asking casino operatorse weeks. new tariffs would be slept on products from countries accused of having undervalued currencies. . past administrations of orting calls to take similar actions. in the opening round of post-brexit trade talks, british prime minister boris johnson taking a tough stance. he says he is willing to accept significant tariff trade barriers with the european union, but that could crush him politically. if u.k. fails to get a free-trade deal, those would be at risk. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm the beyond a hurtado. -- i'm viviana hurtado. this is bloomberg. sonali: coming up, it appears that bernie sanders has a quiet fan club among the financial elite. more on that next in today's wall street beat. if you have a terminal, check out tv . watch us online, click on charts and graphics, and interact with us on your bloomberg terminal. this is bloomberg. ♪ ♪ viviana: this is "bloomberg daybreak." changes to theig rates u.s. merchants pay to accept their cards, hoping to persuade or people to abandon checks. the company is abandoning charges for new businesses such as ride-hailing services, according to a letter visa sent to banks. for the second time this fiscal year, sony raising its profit forecast, reporting strong demand for the image sensors that power smartphone cameras. revenue from sony's playstation division dropped while consumers wait for a new gaming console that comes out at the end of the year. and investment bank houlihan low hired to help the trump administration free freddie mac and fannie mae from government control. during the financial crisis, the mortgage giants were seized by regulators. they've returned to profitability and repaid the cost of the bailout, plus billions in dividends. that is your bloomberg business flash. romaine: thank you. let's turn now to wall street beat, where we cover three things wall street is buzzing about this morning. onst up, the bernie brokes wall street -- the bernie bros on wall street. bernie has some secret bankers who support him. then, a goldman tech leader makes a surprise exit. and degeneration of greed. a hedge fund says this time may go down in history as a generation of greed. joining us to talk about all of these stories is bloomberg's shree natarajan. ost's talk about the bernie br on wall street. is this a real thing? it is a bit of a surprise, but i guess it speaks to the issue that we will hear more about going into the election in november. in the come of the terrible skew we have with the wealth. i don't thing a lot of lost readers are saying get behind bernie because he is going to be the president, but more in a -- but moreant of an acknowledgment of the underlying issues. let's be clear, we really need to caveat this. i don't think any other serious democratic candidate probably has a bigger fan club on wall then bernie sanders, but not every criticism of wall isn't valid. romaine: i'm sure there are plenty there. we are going to get a lot of emails on this. in all seriousness, the reporting that we did do suggest these people are putting their money where their mouth is. they are actually making significant donations and fundraising efforts for bernie sanders. as you point out, still overwhelmingly, a lot of the folks on wall street are supporting other candidates. sri: it still seems to be a closeted fan come. -- fan club. a lot of the donors say there are more people willing to support him this time around then 2016, which i find truly fascinating. sonali: i want to turn to this goldman sachs story. we've lost a lot of people in the goldman trading desk. why does this person matter? sri: last week we were out at goldman-s big show -- at goldman's big show. was a key player of that team, supposed to be overseeing a lot of changes. to see him leave in the midst of those initiatives is what is a big surprise. have jim esposito running this trading desk. what is their plan? sri: i think everyone inside goldman will tell you the whole idea of making sure tech transfer made in is the centerpiece of their rating strategy going forward, that is not going away. but if using about the palace intrigue inside goldman sachs with the new management and the number of senior trading leaders coming in, that was seen as part of the change of guard. this one is different because adam korn was seen as part of the nucleus. he was supposed to be part of the next generation of leaders. that is why we are a little puzzled by this move. romaine: he was part of that circle, one of the younger leaders as well. do we have any idea what the replacement is? sri: we lost quite a few innovators in the last year. electronic --e x the electronic engineering had a year ago. the chief technology officer left. at the same time, there's been firepower from the outside. it's not like you have empty chairs walking around goldman sachs. romaine: that's get to our third story. lee ainslie at maverick capital had some interesting comments with regards to the generation of greed, and seems to link this idea to deficit spending. sri: it is also fascinating the language he is using around generational greed. a couple of weeks ago, the chief executive officer of morgan stanley said it was the end of the boom and bust cycle and said, have you seen the end of fear and greed? that speaks to what lee ainslie is talking about. a lot of the elements of his speech were fascinating. he listed some any factors that could lead to problems such a slowdown in earnings, gdp shock, or anything else that could come from the outside. he said when you look at growth stocks, it tends toward 1990 time -- toward 1999 and any other time, and that is a dangerous comparison. sonali: he said that he sees some kind of need for a wealth tax. it seems like there is a big disparity on how wall street feels the government should intervene on how much they are making. sri: this goes back to why you have bernie bros on wall street. it is not overwhelming recognition come of it at least a creeping recognition that there are problems with the system. not everyone can agree on the solution around it. romaine: that's a good point. lee ainslie isn't out here by himself. a lot of money managers have talked about, not being benevolent, but the idea that you need an economy that functions properly for everyone in order for them to make money and further their business interests, and they recognize that. but are we going to get there? sri: there's also possible self-interest there. if you don't go out and offer useful solutions, they are going to come after you with a pitchfork. sonali: thank you so much. today's off the beaten street, change is coming to the venerable cfa exam. era of taking the test with the pencil is ending starting in 2021. it will be administered electronically four times year and have tony 5% fewer question -- and have 25% fewer questions. last year, only 40% of people had passed. romaine: it was kind of grueling. four times a year? didn't i did my mba so i have to deal with it. romaine: i thought the reason they did it once a year to protect the questions. sonali: did the iowa caucus happen online? romaine: it did, and it was a disaster. coming up, how currencies will be affected by the coronavirus outbreak. and if you are heading out and jumping into your car, tune into bloomberg radio across the u.s. on sirius xm channel 119 and on the bloomberg business app. app apple works -- that works. from new york, this is bloomberg. ♪ ♪ sonali: time now for our trader's take. joining us is vincent cignarella, voice of the bloomberg audio squawk. listen to vence on bloomberg by typing in squa . what are we looking at? vincent: this came from a trader yesterday, and i would encourage folks if they have ideas of where they think things are going, feel free to email me. this is where traders are looking to hedge virus concerns. currencies, the mexican peso and buying the japanese yen. the blue line is the average 12 month closing price. you can see your entry level is right around here, and this particular trader i was speaking to is looking for a real fade in this all the way down to a lower band, which would be about an 8% move. romaine: what would be the general rationale behind this? vincent: that we are seeing a risk rally today, but that this hasn't peaked. we've got at least a couple more weeks for more news to come out, and the real concern is we seem closing of borders in hong kong and china. if this should break more into hong kong, the epicenter of the financial world in asia, this could perhaps bring these worries back on again. and let's face it, china is in lockdown. it is going to slow their economy, and there are a lot of slower growth stories yet to be heard in asia. sonali: are there other currencies looking at fears? vincent: ozzy is rallying overnight on the rba talking about -- the aussie is rallying overnight on the rba talking about dental rate cuts. romaine: our thanks to vincent cignarella. coming up on the program, matt johncan -- matt miskin, hancock advisors market strategist. this is bloomberg. ♪ everyone uses their phone differently. that's why xfinity mobile lets you design your own data. you can share 1, 3, or 10 gigs of data between lines, mix in lines of unlimited, and switch it up at any time. all with millions of secure wifi hotspots and the best lte everywhere else. it's a different kind of wireless network, designed to save you money. switch and save up to $400 a year on your wireless bill. and save even more when you say "bring my own phone" into your voice remote. that's simple, easy, awesome. click, call or visit a store today. can you help keep these iguys protected online?? easy, connect to the xfi gateway. what about internet speeds that keep up with my gaming? let's hook you up with the fastest internet from xfinity. what about wireless data options for the family? of course, you can customize and save. can you save me from this conversation? that we can't do, but come in and see what we can do. we're here to make life simple. easy. awesome. ask. shop. discover. at your local xfinity store today. ♪ sonali: welcome to "bloomberg daybreak" on this tuesday, february 4. romaine: quite a day. we are seeing more of a risk on day than what we saw heading into friday and even into monday. seeing a little bit of a rebound in asian markets, something we didn't see yesterday. sonali: people shaking off those coronavirus fears. we are still waiting for iowa caucus results coming out. let's see if this rally holds up. don't forget, we have more earnings later today with disney and a lot of data out of the u.s., including on factory orders. let's take a look at the top stories you need to know at this hour. >> i certainly would not agree with the allegation that we are not addressing this public health concern adequately. romaine: hong kong reports a death from coronavirus, the second fatality outside mainland china. people nowundred confirmed to have this people now -- 20,600 confirmed to have this coronavirus. this whole region is on watch. shutne: in macau, casinos down for 15 days to prevent spread of the virus. sen. sanders: i imagine, have a strong feeling, that at some point, the results will be announced. [cheers and applause] romaine: and attempt to modernize the presidential cost us -- the presidential caucus system leads to debacle in iowa. david: it was all problems with an app to tally these things. there were some sort of delays, some sort of problems, and we got results that there were going to be delays, and there were reports of inconsistencies. romaine: democratic hopefuls left waiting for the results. the integrity of the process called into question. alphabet revenue missing estimates as revenue slows. >> it was this disclosure they gave which analysts have been asking for, some additional information about how much revenue they generate from youtube. romaine: new disclosures for the youtube and cloud computing units provide a couple of bright spots. and a bleak earnings season for big oil finally offered something for investors. >> 2019 is probably one of the strongest years we have seen in oil trading in the last decade, and you've seen not come through the results, particularly in upstream in the fourth quarter, but also throughout the year in terms of downstream. romaine: trading revenue helps bp beat estimates and boost its dividend. the pace now turns to the deleveraging effort. let's take a quick look at what has been happening in the markets. we are seeing a bit of a risk on move. s&p futures moving up decisively, up around 1.2 do -- of around 1.2% an hour away from the start of cash trading. your 10 year yield at 1.5%. a lot of folks unwind those haven assets. yuan fixed above that seven mark. 6.9951 is what you're looking at for the day. here,luminum, and copper something we don't see often, an up dayfor copper -- an for copper, up about 2.3%. coronavirus cases have risen above 20,000, and hong kong has confirmed the second fatality outside of mainland china. joining us from hong kong is rishaad salamat, coanchor of "bloomberg markets: asia." what do we know so far about what is going on today? 20,600 is the number affected, and more than 400 have died, two of them outside the mainland. most were concentrated in the epicenter of where this all started, hubei province, and wuhan as well. what is going on at the moment, there is the fear of contagion, and none more so than in macau, where they have 10 confirmed cases. they are closing their casinos for two weeks because of this, and that all starts tomorrow. this lockdown could lead to a 50% fall in revenue in the first quarter. we are at the moment seeing how this is the biggest fall we have d,en in revenues in this perio the biggest fall we have seen since 2015. on top of that, we have never seen a closure of casinos for this long. it is the world's biggest gaming hub. in hong kong, we were reporting a short while ago a death here, a 39-year-old male. he hadn't visited the mainland, but had underlying health issues. china now with six further cases, including a man in a serious condition. romaine: rishaad salamat, thank you very much. sonali: joining us in new york hancockmiskin, john investment management strategist, and joining us here is melda mergen, columbia deputy global head of equities. can you markets shake this off here? matthew: the news here is just so sad to see. and we think about china and the impact on global economy, it is 20% of global growth, and it is the biggest engine of increasing growth. it is a lot different than the sars epidemic in 2003. back then, it was about a $2 trillion economy. about $8 trillion. when we are seeing the quarantine we are seeing now, that will lead to a shut down and i, growth. that is going to trickle into the broader economy, and i think that is why treasuries are rallying like they have thus far this year. -- melda, a lot of this is about the chinese growth story and will it ultimately become a global growth story. what is your thesis right now for that global growth story? melda: i agree with matt that it is a real human tragedy, and we can't lease side of it. but when we look at the economic impact, it is not going to change the long-term expectations in the global growth in terms of waiting for a recovery in 2020. we are expecting some delay, as matt said. it is the second-largest economy, so you can't ignore the fact that they are going through this tragedy, but generally, we are still exciting recovery as we have seen in 2019 the leading indicators start bottoming here. room tomuch more overstock, so we are still investing -- we are still exciting that to happen in 2020. of the china is 1/4 world manufacturing sector. how can this be disruptive to supply chains? matt: it is definitely disruptive. when you look at the pmi data, manufacturing surveys, if there is any good news out of this, which there really isn't, january was starting to see improvement in the manufacturing sector. lower rates around the world started to push stimulus into manufacturing and the overall economy started to rise. global pmi up. more likely than not, you get a tick down into february, but if this can muddle through in the first quarter and then start to make a, we can manufacturing recovery happen in 2020, and that is really what the markets need to grow any multiples we are reaching in a pe basis. romaine: we got a little taste of that yesterday with u.s. leasts coming out at briefly. that seems to be the expansion here. when you look at the rebound it needed in any factoring, what actually drives that? is there some real catalyst for this, or are we just talking about cyclical recovery? matt: i thick it is a broader synchronized global growth backdrop. 2019, powell even mentioned last week he started seeing signs of a 2019 type recovery. that was the euphoria of the markets. everything was awesome. you had international equities rallying, u.s. equities rallying come abroad recovery in pmi's. we start the year like that, and then this happens. throwing from in the towel on that yet. sonali: obviously we have a risk on appetite today, but what can offset that? melda: i still think there will be headline risk. we know from the previous experience, once the case numbers are peaking and decelerating where the market starts getting comfortable and recover from here, it is hard to time it, but i don't think it is going to be this week or even next week, given the long-term incubation with this specific virus. so there's going to be a lot of volatility in the market in the coming weeks, but again, long-term effect of this virus, we don't think to be significant. there's a good set up for the industrial recovery and economic growth picking up from here. but we still think any news right now is going to get the market changing. romaine: when we talk about this potential pickup and the support that the fed and other central bank's around the globe can provide, how much space do you think they have, and what do you think they're going to do? melda: i think they don't have to change the course, but reaffirming and making sure the market hears them out, that they are going to keep the course, is going to be the key message from them. we are not inspecting them to do more aggressive moves from here. sonali: matt, do you agree that the longer-term impacts are not calculable? do you believe there are significant risks in the longer-term? at this cycleook here, we've almost had three bounce, we, if pmi's think this is a more modest bounce. you don't see the same magnitude 2012-2013.r we are starting to see momentum stocks really rip. we are sticking with that playbook and being disciplined about risk is really important at this point in the cycle. miskin and melda mergen staying with us. we do have some movement premarket. tesla shares briefly topping $900 a share in the premarket. we also got quite a few earnings out, and big movers here. royal caribbean missing on their guidance, but still moving higher. sonali: coming up, the winner is -- we don't know yet. the iowa democratic party delays the results of yesterday's caucuses. we will look at the market risk from political uncertainty next. this is bloomberg. ♪ >> whether it's bernie, whether it's elizabeth warren, whether it's klobuchar, they've been stuck in d.c. joe has had iowa to himself. if he doesn't win tonight, it is very indicative of his campaign. i think you got to win big. sonali: that was donald trump, jr. speaking with bloomberg chief washington correspondent kevin cirilli in iowa yesterday. we are still awaiting results of the democratic caucus in the state. kevin joins us now from des moines. what do we need to know without any news yet? kevin: well, we don't know what happened. it really is quite remarkable. i've been speaking with sources and staffers all throughout the night to get a timetable of when we are going to get these results. the iowa democratic party is saying we could get them today as they want to make sure that all of the votes are counted, all of the caucus precincts are reported. they are blaming an application, the first time they've used this app. precinct captains have had to call in the results. bundlerenior democratic put it to me, it is a big mess. the iowa democratic party says "we found inconsistencies in the reporting of results. this is not a hack or an intrusion." this is really drawing questions about, from the campaigns, what really comes next. with nokia winner, it now points to all -- with no clear winner, it now points to all in on new hampshire. joe biden's campaign had their general counsel submit a letter to the idp. "we believe that the campaign deserves full explanation and relevant information regarding the methods of quality control that you are employing." so right there, already questions about what went wrong in iowa. we are going to be talking about this even after the winner is announced, whenever that may be. romaine: this is all of the talk around all of the proverbial water coolers today. i am sure donald has had something to say about this. has a? -- has he? kevin: let's pull up a tweet from the president. "the democratic caucus is an unmitigated disaster. nothing works, just like they ran the country. remember the $5 billion obamacare website? the only person that can claim a very big victory in iowa last night's trump." the president set to deliver his state of the union address tonight. i am told by sources at the white house he will deliver an optimistic tone. pay attention to see not how he talks to his base tonight, but if he is able to connect with suburban america. he needs to win back those suburbs he lost in 2018 if he wants to get reelected. chaos line, political really starting here in des moines on what could have been a day for some candidates to project momentum, now casting a shadow of confusion with the state of the union in a few hours and the likely acquittal in the senate for impeachment tomorrow. sonali: thank you for joining us. romaine: still with us here, matt miskin of john hancock investment management, and joining us by satellite, melda mergen of columbia threadneedle. melda, obviously a lot going on with politics with the democratic caucuses, state of the union tonight, and impeachment vote tomorrow. strictly from an investment perspective, how much of this plays into your universe right now? is an important week in the political environment and economic environment, so we pay a lot of attention, but it still comes down to looking at the companies specifically and their fundamentals. we did a lot of work to understand the policy stance for the candidates and make sure that our portfolios are not exposed one way or another, so that is how we play this year until the election. sonali: matt, how are you adjusting your portfolio to account for this very divided election? matt: i don't know. that's the simple answer. but we are looking at the pmi data we talked about, the earnings data, the fed. but as it relates to policy right now, we are going to think the economy and the markets will have more of an influence on the political environment than the other way around. that is what we are watching. romaine: we came into the trump administration in 2016 expecting pretty big policy changes. we got them to a certain extent with the tax cut and a lighter hand with regards to regulation. do you have any sort of expectation that the trajectory we have been on with regards to washington policy would change after the november election? matt: not really. the way we look at it, yes, there's been a lot of good things for the market and the economy that have come through the system. we think that's done a lot of the heavy lifting in the last couple of years, but now that has filtered through the economy. that's why the fed cut three times. that's kind of gone on fumes in terms of its response. but what's the next thing? we need the economy to stand on its own two feet and gain some organic growth, regardless of the political outcome. sonali: i understand we are looking at fundamentals here. why did we see so much fervor around the health care and technology sectors at the end of last year? do we not expect those things to continue, those kind of worries? melda: there are very specific policy stances at the tail of expectations, so i think the market is reacting to those headline news, but the policy stance is one thing for the presidential candidate. it is another thing to pass that through congress and make it a real law. we think it is really overdone, especially in health care. romaine: on the broader issue when we talk about the economy and this idea of needing to stand on its own two feet, a big element to that, in some people's minds, is fiscal spending or some kind of plan that can divorce us from being completely dependent on the fed and low policy rates. do using that is necessary, and if so -- do you think that is necessary, and if so, what do you need to see? melda: 70% of the gdp in u.s. is consumer, so the consumer is the most important indicator for the health of the economy, and it is doing well so far. the fiscal policy with think is necessary in areas like infrastructure because we need investment in those areas, but specifically for growth to accelerate from here, i don't think it needs to be the primary driver. sonali: we were talking about three rate cuts. does the fed have steam go wrong should something go wrong -- does the fed have steam should something go wrong between now and november? matt: i think they do. we had 1.9 8% on the 10 year with not that steep of a curve. now you get exhaustion us shock in the fed is put it you get exhaustion us -- you get exogenous shock and the fed is put into a corner. if the fed is looking at that, they really want that to re-s epen. re-ste they may have to look at that in election year. romaine: we see that three-month-10 year slightly inverted, and the five-year hanging on the precipice. matt miskin of john hancock investment management and melda mergen of columbia threadneedle stick around. tune into bloomberg television tonight for special coverage of president trump's annual state of the union address. that is going to begin at 9:00 p.m. eastern time. from new york, this is bloomberg. ♪ ♪ ♪ viviana: this is "bloomberg daybreak." conocophillips forecasting this year a decline in oil production. the company announcing plans to return more money to investors. it's boosting share buyback plans by $10 billion. opposite problem of many shale oil producers, too much cash and too little growth. shares of alf falling -- of alphabet falling. search advertising growth revenue from plus youtube disappointing. citigroup suspending a junk-bond trader in london who earns more than $1 million a year. his crime, repeatedly failing to pay for food from the bank's cafeteria. all of this according to "the wall street journal." how is your stash from the bloomberg pantry doing? romaine: i was stocking up, but maybe i should take a few less fig bars. we don't really have the details here and don't want to speculate, but there does seem to be coming from citigroup's perspective, this idea of integrity. sonali: so for the outside experts, you want to eat your food in the office, folks. romaine: what are you having for lunch today? sonali: i might eat out today after this one. romaine: she's buying. [laughter] romaine: coming up, nearly 50% of s&p 500 companies have reported earnings. we will take a look at the beats and misses. that's coming up. this is bloomberg. ♪ romaine: this is "bloomberg daybreak." i am romaine bostick in for alix steel. we are seeing a risk on move coming into the market. s&p futures up 1.3%. green across the board for a lot of the companies. tesla driving tech stocks higher. up 20% yesterday, up 16% in premarket. the only real red flags on the market are alphabet moving lower and 17 also moving lower -- centine moving lower. not as -- not enough to overcome the upside we are seeing. dow futures higher. europe, you saw the rebound in mainland china. 158.re taking we should also point out in the currency space seeing a significant rally in the pound. a rebound rally. that is pushing the u.s. dollar index down a little bit lower. crude oil rebounding. seeing a rebound across the board in the commodity space. copper, 2.3%. sonali: half of the s&p companies out so far with results. set to reportsnap today. still at this are matt miskin and melda mergen. you love this growth rally. what are you buying? quality is aike factor across the global equity market. return on equity, better balance sheet, focus on margins. that brings you up in cap. it does bring you tech. looking at earnings results, it was a tough year last year. that is tapping off with a tough quarter in the fourth quarter but some of these companies are growing up 10% or 20% in the tech space and they are getting hit on it. we will take it and we will look at the underlying fundamentals. what we are starting to get concerned about is momentum. momentum is starting to run and there's not a lot of fundamental support. that is where we think the risk on the market is on the line. romaine: when you look at some of the reports we have gotten in some of the forecast into 2020, what you make of it so far? melda: coming into this earnings season, the bar was low. it was not hard to clear and most of the companies cleared. there are no big surprises for us. we are listening closely to management guidance and their expectations of 2020. there is a lot of that recovery headlines and stories in the market and we want to make sure the management can avert that. that is where we are focusing. sonali: that is a great point. what can derail this rally? what are downside risks? matt: we are looking at the top line growth and the bottom line, the margins. there is a war on margins. what we are seeing in terms of street expectations for 2020, starting at 3% earnings growth for q1 which is ok given that everything going on, it is great it is a lower bar. it's a quench laced steps up and by the end of the year we will see 13% earnings growth. 6%, revenue growth growing the one high on the top end, but on the bottom they expecting margins to increase. how do you get that done? we have seen hiring come down. interest rates are lower, borrowing costs are lower. but where else would you get the margin expansion? it is hard to get in the market is running on that. romaine: that raises the question about the difference between the large-cap companies that have the power over margins. amazon being the poster boy. then we have mid-cap companies that do not have that flexibility. how does that shake out? mid-cap stocks are ok. these companies have grown up out of the small cap universe. get ho funding. small caps are risky. if you look at the debt to equity of small caps, the russell 2000, it is growing at a 45 degree angle. what they are levering up to get that return on equity, that is not a healthy way to do it. if you look at asset turnover in and largequity medium have that more than small. sonali: less than exciting numbers out of the oil sector. what are the areas of the economy -- what earnings are you looking at that are negative? i would say specifically on energy, we are looking at capital discipline. earnings are disappointing but the companies are doing a lot of things to make sure they are much more disciplined. was mentioned, it the valuations at the market level is hard to justify. there are so many companies we can see the valuations may be looking stretched with a lot of earnings growth. we are still investing in those companies. romaine: when you talk about those types of companies, are you looking to companies more tied to the consumer spending side of the economic equation or more toward some of the business or potential business spending increases some people are anticipating? melda: you cannot eight nor consumer -- you cannot ignore consumer, especially if it is domestically oriented. that is where we are paying attention. the companies who know their customers, who are creating solutions for their customers are having strong earnings and topline growth. we are focusing on those companies. then of course the management, governance, and discipline of how they allocate capital and how shareholder friendly, those are the other factors we take into account. sonali: the earnings we have seen, was it the fed? was it tax cuts? have we outlived the quds -- of we outlived the juice? melda: the u.s. is -- matt: the u.s. is still doing pre-well. whether that is fumes of policy intervention, perhaps. the u.s. is still chugging along well. to the international side and you look at the revenue , those companies that have more revenue exposure outside the u.s., those are struggling. right or wrong, whether it is stimulus or not, the u.s. decides where the earnings growth is and that is where we gravitate to the u.s.. morene: long-term you want u.s. focused revenue breakdown or do you want to see more international exposure? matt: we look at the exposure on international that looks attractive. inr the last decade earnings the united states have outpaced international counterparts by a large margin cured when someone asks why is international underperforming, it is because the earnings are massive. if that continues, we are staying the course. we are willing to change. sonali: obviously -- romaine: obviously a lot of this time to global trade. remember the phase one deal. ,att miskin and melda mergen standby. we will get back to you in a moment. sonali: let's get an update on what is making headlines outside the business world. viviana hurtado is here with first word news. viviana: i was political spot -- iowa's political spotlight turning into a nightmare. the state will not release results from last nights's caucuses until later today. the state found what they called inconsistencies from some local precincts. official said they were struggling to use a new phone app. for only the second time, the death of a coronavirus was reported outside mainland china. the victim was a 39-year-old man with an underlying illness. china says number of confirmed cases is now more than 20,000. at least 425 people have died. to stemking new steps the spread of the virus. it is asking casino operators to shut down for a couple of weeks. the trump administration clearing the way for a controversial plan involving new tariffs. they would be slapped on products from countries accused of having undervalued currencies. past administrations avoiding calls to take similar actions, concerned it could lead for tit-for-tat currency wars. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am viviana hurtado. this is bloomberg. sonali: still with us are matt miskin of john hancock ofagement and melda mergen lumbee a threat needle. we are looking at trade and how is the coronavirus impacting u.s. china trade discussions. matt: you are already seeing headlines china would like flexibility around the trade deal. mid-january the trade deal was signed. the coronavirus happened days after that and started to spread. it is going to be hard to handle the numbers. does this mean there is a real acceleration of that risk? it is hard to say, and you would not overplay the risk. i think it is pretty understandable what is going on in china and why they cannot buy as much goods, especially the oil market, commodity market. you have to be patient. we are saying as long as the fundamentals are good, stick with that versus the trade deadline coming back. romaine: when we signed the phase one trade deal, there was a lot of hope that at least some of the disruptions we have seen in the supply chain and the global trade would write itself -- would right itself or start to. what are you anticipating with normalization of global trade? melda: it is hard to predict, but definitely phase one gave people less uncertainty about the future. what we heard last year from a management teams where they were thinking about their capital expenditure decisions and they were delaying it so that phase one gave them more confidence. it is also true that even chinat the trade deal, set some policies around what the trade deal is trying to get, like the intellectual property rights and other things. i think that will continue to be their focus with or without the trade deal. sonali: house this playing into your investment thesis? the uncertainty? matt: we continue to gravitate more toward the u.s.. quality factors is our number one idea. with fixed income, we have moved up and quality, investment-grade corporate, duration five and a half years. what we love about the 60/40 portfolio is there's actually diversification benefits. the 12 month correlation with the s&p 500, -.5. that is about as good as it gets. we are saying that could be the revenge of 60/40 at john hancock. we are happy going into this year. melda, i will give you the last word. clients want to know what your thoughts are. what is the main thing you tell them? melda: we tell them to be patient. there will be so much headline risk this year with election and unexpected virus spread, but we can pick the stocks at the stock level, and create portfolios that can deliver their outcomes and meet their goals. stay patient. romaine: melda mergen, thank you so much for joining us, and matt miskin of john hancock investment management. sonali: coming up, tesla is on a tear. shares extending their rally, setting it up for a second record-setting day. more on that in today's bottom line. remember, bloomberg users interact with charts shown using gtv . browse charts to catch up on key analysis and save charts for future reference. this is bloomberg. ♪ viviana: this is "bloomberg daybreak." i'm viviana hurtado with your bloomberg business flash. we begin with visa. the company planning big changes to the rates u.s. merchants play for accepting cards. it is hoping to persuade more people to abandon checks. the company suggesting its charges for new businesses such as ride-hailing services all according to a letter visa sent to banks. for a second time this year sony raising its profit forecast. the japanese company reporting strong demand for the sensors that power smartphone cameras. revenue from sony's playstation division dropped. demand has fallenconsole that ce end of the year a new report says apples push into streaming tv is failing to resonate. the note from bernstein estimating fewer than 10 million consumers have opted for their free trial of apple tv plus. that is 10% or fewer of customers. unlikepple only -- amazon prime, apple only offers original shows. sonali: time for the bottom line, where we look at three companies worth watching. the first is tesla. $900 afterres above a 20% surge on monday. shares up as much as 16% premarket. it has spurred an analyst downgrade at new street research. people leave it might be too high. it has gone way beyond its peers. do you want to short it now? that is the question. romaine: we will find out. there was bloomberg reporting that asked is this a short and kind of threw water on that, saying there is not a lot of evidence. sonali: momentum is in its favor right now. we know you are watching alphabet. romaine: alphabet came out with earnings last night. they beat on a lot of the main metrics but there was slow down in that growth. 70% growth right, down from 20%. the real issue is they are now trailing facebook. they broke out there youtube numbers and pretty strong growth there. they were a little bit light than what companies were expecting. you've seen the shares move lower. this is still a juggernaut. you are talking about a company with a double digit growth rate not as high as the double growth right people thought. sonali: one dark mark on the faang. the third company is royal caribbean. for more, brooke sutherland of bloomberg opinions joins us now. romaine: the pride of kansas. a royalyou cannot take caribbean cruise ship to kansas, unfortunately. nor can you take it to china. they have canceled eight cruises through march 4. they announced planning procedures to limit the impact and say they will test all passengers who travel to and from china but also anybody who has a chinese or hong kong passport, even if you've not been in the country, which is an interesting twist and how people are managing the outbreak. they did come out with their guidance for 2020. that was not as bad as analyst had feared. issues with the coronavirus? brooke: it did not. not as bad as fears. it did not include the coronavirus. sonali: what is the longer-term impact? brooke: from these canceled cruises, they think a 25% impact. the question is do you make that up in the back half of the year? if you are a passenger who booked a cruise, are you going to reschedule or is that just lost revenue? is that permanently gone for royal caribbean? i think the outlook for their cruise industry is strong. can contrastan with peers like carnival and have newer ships and charge more money to put passengers on those ships. the outlook looks good. now you just have a complicating factor of the coronavirus. romaine: if we look at the impact of the coronavirus, you've seen the travel industry take the brunt of it, whether cruise lines, airlines, hotels, resort. we have heard macau is effectively shutting down for 15 days. you wonder, does that have a material impact on a company like a royal caribbean or some of its peers? brooke: they did issue a warning in january and said we do not know what the longer-term impact will be on the china consumer. they do not know what the rate will be, if there is less demand from the chinese consumer for cruises, then you have to lower your prices. does that impact your margins or your yield? they do not know at this point. that is why you are seeing them not give definitive guidance. that is something we are seeing from all of the manufacturing companies. they are not willing to put a number on this because nobody knows how bad it will be. if it is more short-term or longer-term impact. sonali: are we seeing estimates or do we just not know how bad it can get? brooke: you are not seeing anybody put numbers on it and you cannot blame them. everybody is surprised by how quickly the virus has escalated and efforts to contain it are having a significant impact on the overall economy. with royal caribbean, they did come out with their guidance for 2025. that is providing a bit of a boost. they are saying they are looking to double their earnings per share from the 2019 levels to about $20. you want to talk about longer-term impact, they think they will get past this and get in a strong position. also talking about cutting their carbon footprint by 25%. romaine: how do you do that with a boat that size? brooke: i wonder if that factors into the i am a world? fuel more efficient and if the ship will try to measure up. -- if they adopt the imo rule? brooke: it is still a debate. ball not sure if that will raise -- people not sure if that will raise the long-term rate. facing pressure from consumers to be greener. romaine: you take cruises? brooke: i have in my life. i do not know that i would right now with the coronavirus. sonali: have you taken cruises? romaine: i have never been on a cruise. i do not like being in crowds of people. brooke: there was the carnival ship that got stuck off the coast of italy with 6000 of your closest friends while they extra jaded -- while they extricated someone who had the coronavirus. romaine: did they keep the bar? brooke: may be drinks? romaine: -- maybe free drinks? romaine: our thanks to brooke sutherland. coming up, we will have more on tesla surge and whether it is time to start getting cautious for tesla investors. if you're jumping at your car, tune into bloomberg radio heard across the u.s. on sirius xm channel 119 in the bloomberg business app. from new york, this is bloomberg. ♪ romaine: time for technically speaking. we are with bill maloney, the chartered market technician and the voice of bloomberg's equity squad. he joins us right now. what is up first? taking a look the s&p 500? bill: futures are up. we talked about how 30 to 48 and 3250 was resistance. potential resistance in this then 3300. and first resistance around 3286. sonali: i know we are also looking at the stock of the morning. tesla breaking through 900 premarket. what if we got? bill: it jumped 20% yesterday, the biggest move since 2013. closed at 91. that is a bit extreme. soaring at the premarket. it hit 900. when it came in this morning it was at 800. it started to be in these gaps. it almost feels like amazon and qualcomm during the late 1990's during the internet bubble. the stock is moving in these gaps on the open. when something is moving parabolic and these gaps, you are not early. romaine: a lot of euphoria around tesla. we had earnings from alphabet that were not quite what investors were looking for. we are seeing the shares move lower in the premarket. bill: down around 3.5% in the premarket. it was in this uptrend from the june lows. look for support at the top of the trend around 1420. if that fails you are looking at hundred round figure. sonali: bloombergs bill maloney, thank you so much. that does it for "bloomberg daybreak: americas." open, lisan the shalit of morgan stanley wealth management. this is bloomberg. ♪ amazon prime video is on xfinity x1. so when you say words like, "show me best of prime video" into this, you'll see awesome stuff like this. discover prime originals like, the emmy award winning the marvelous mrs. maisel, tom clancy's jack ryan, and the man in the high castle. all in the same place as your live tv. it's all included with your amazon prime membership. that's how xfinity makes tv... simple. easy. awesome. ♪ i'm feeing good right now [ fast-paced drumming ] jonathan: from new york city to our audience worldwide, i am jonathan ferro. the countdown to the open starts right now. ♪ jonathan: coming up, chinese stocks stabilizing, u.s. equities bouncing back, oil convenes ans opec urgent meeting. iowa descending into chaos, emma kratz still waiting for results. 30 minutes until the opening bell this morning. foremocrats still waiting results. 30 minutes until the opening bell this morning. treasuries down, yields higher, up seven basis points. the euros slightly weaker. let's begin with the big issue, confidence building in chinese officials. >> china has shouldered the capacity to quickly boost activity. >> a variety of different stimulus. >> a lot of policy stimulus already in the pipe. >> a lot of levers internally. >> chinese monetary policy. >> we have a lot
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