The s p 500 30 below the 30 day average. It goes to what mike was saying about how a good jobs report lends to sector rotation in equities. Romaine we should point out that some of the other asset classes, we did see the dollar higher on the week, oil down on the week, and very low volumes today, but looking at etfs, volume was about average. We did see a lot of activity there. Joe small caps. Romaine thats right. Lets dive deeper into the action right now. Renita, get us started. Im watching iron ore, which sunk to its largest drop in about two years. It is ending the week actually up the most since june 21. Most Metals Commodities definitely took a dive. The bloomberg Commodity Index also lower and the dollar higher. Which makes commodities that are priced in the dollar more pressure than usual. Taylor . Taylor for me it is all about bond deals. We are taking a look at the price action we are seeing on bond yields. We are now rising nine basis points on the day. That is our biggest oneday move since april. At one point this number was looking like 9, 10, 11 basis points. At that point, it was a record. We are seeing a lot of diverging opinions. I was speaking earlier with kumar. He was saying the 10 year is now looking at 150. I asked a followup question. He said no way the 10 year is going to end of 2 . A lot of diverging opinions on direction. Todayasis point move certainly catches my attention. Romaine thanks, taylor and renita as well. Still with us is oliver as well as bloombergs michael regan. Youer, i want to go to first. Right now we are at about 2. 04 on the 10 year yield. Are we getting to some fair value consensus . Oliver i think the treasuries continue to be in a range. We havent had moves that are pretty outsized. Weve been around the 2 mark for quite some time now. Oront see it going to 250 150 unless something really remarkable happens. If you are a bond investor, you stick to the short end of the curve, high quality, and use it as volatility mitigating rather than anything else. High yield is up nicely. Return forretty good fixed income given where we are. Joe mike, i want to get your take on this. Everybody screams all day, cant believe these low rates and negative rates around the world, but they are still doing their job in the portfolio. Risk parity. Theyve done well. Even at these low rates, kind of fulfilling their word. Mike it is trickier in europe when you are basically betting buturther negative rates, the 10 year yield did pick up a lot. The twoyear rose more. That way off the lows of curve, but we still have the three month above the 10 year treasury yield. A lot of people i talked to, the main case for the fed to ease in july is to get rid of that inverted yield curve. , a little bit flatter yield curve. Mike, youve been paying attention to assets, treasuries, 1400,hich dipped below as well as some sectors that have looked a Little Pricey as of late. Mike that goes back to this idea of maybe there was some rotation today. One thing i looked at earlier was utilities that are now trading above 20 for the first time ever. That is a monthly chart. It doesnt show back in 2000. This is basically the most expensive Utility Industry since the Industry Groups were broken around 1990. It looks to me, people got very defensive in the stock market. It looks like a crowded trade above 20 for a utility. Romaine oliver, when you look at the market, what areas do you see more attractive than others . Oliver we like growth. If there is an absence of growth, if you can find companies that are improving margins, they tend to outperform. We continue to be a well basis as wellctor as industry basis. Theres some great values in europe. We are concerned about dollar moves as well as the economy over there. Joe i was just going to say, u. S. Seetside the value and the consistent story has been underperformance. Goes back tou. S. Winning. What ultimately changes that regime, where you get durable outperformance . Oliver economic performance. It is about gdp growth and earnings growth. Islong as europe effectively growth, is to 1 gdp going to be tough for european equities to outperform u. S. Equities. We like to look at equities from a country basis more as to where the revenue stream is. Total, the french oil conglomerate, gets more of its revenues from north america than exxon mobil. You want to keep that in mind. From a pure investment perspective, as long as the u. S. Continues to outperform on a gdp basis and as long as theres a strong case to be made that u. S. Based companies have better , theres fullh logic as to why they are outperforming. Scarlet i want to get your take, oliver, on technologies. Sonsre talking about sam preliminary results and how concerning that is, considering that it is a barometer for the Global Technology industry. How much do you read into Something Like that and what it tells us about trade tensions playing out . Oliver much like the earnings report, it is important to look at the overall trend and not just pick out a single data point. Technology has performed very well. It is the strongest performer year to date. There are still some areas that are growing rapidly. As a longerterm investor, there might be a blip, but the expectation is that over the next two years that continues to be a favorable area for investors. There are names within that one of them is microsoft. Romaine lets broaden this out. We havent talked about earnings in aggregate. Q1 came in better than some people thought. Q2 is sort of shaping up to be what . Mike could be negative. The estimates are pointing to a negative growth in earnings for the second quarter. Companies have a habit of beating those estimates. But i think the risk is that analysts are optimistic about the fourth quarter, expecting a bottleneck of growth. As those get ratcheted down, you might see some volatility in the market. Any sort of resolution on the trade front, people would look past any softness or weakness in earnings and get to the other side of the tunnel. Thatptimist would say todays jobs report suggests maybe we can get that pickup. , want to thank our guest oliver, as well as our very own mike regan. That does it for the closing bell and for me. Whatd you miss . Is up next, where the team will continue to focus on the jobs report and what the fed does next. From new york and from london, this is bloomberg. Romaine live from bloombergs World Headquarters in new york, im romaine bostick. Joe and im joe weisenthal. Romaine u. S. Stocks falling today, treasuries tumbling, on the news that u. S. Hiring picked up. Joe the question is, whatd you miss . Romaine jobs deliver. U. S. Hiring rebounded in june. Bank saga rolls on. The ceo presents a sweeping overhaul of the lender over the weekend. In greece, the election of a pro business government expected to extend the rally in the nations debt and equities, at least for now. Joe meanwhile, National EconomicCouncil Director larry kudlow speaking with bloombergs Jonathan Ferro, the question on everyones mind, what is the case for a rate cut . I dont think there is a phillips curve tradeoff between strong jobs and higher inflation and Interest Rates. I think more people working and succeeding is fabulous. I think the evidence shows that the inflation rate is rockbottom. Looking at some of the market figures on the way over here, not only do you have an inverted yield curve, which i think is troublesome for the longerterm, but the breakevens on the inflation, the fiveyear, jonathan, is 1. 5 . That the fed uses would be about 30 basis points less than that. So that is way below the feds target and what most people want and that is the reason i think they should take back the Interest Rate hike. Im not encroaching on fed independence. Im just reading the market tea leaves if you ask me. Im just saying i think that is the case. Economy,ak global taking out an insurance policy is not a bad thing. I think the debate is how lower rates will help, whether the price of credit is the problem in the United States or europe, and most people are answering no. How will a lower rate help address the issues you outlined . I just dont want anything to interfere with the strong prosperity cycle. That is my principal point. I think as market signals have been suggesting, the Interest Rate story looks unbalanced. It is not that im going to inject stimulus here. Im not looking at that old model. Im just saying that when 10 year treasury paper is trading well below the fed funds rate, i think that is a message to the fed that the target rate is too high. And i think they are looking at that. Im not sure that our views are much different from the feds views, but that is my basic point. It is not so much about stimulus as putting more balance into the Financial Sector and the yield curve. Joe that was bloombergs Jonathan Ferro speaking with larry kudlow earlier today. Joining us for more on todays jobs report, martha gimble, Research Director at the indeed hiring lab, and International Team of economists. Martha, thank you for joining us. Your take. Rious larry kudlow doesnt believe the phillips curve relationship exists between unemployment and wages. It feels like a lot of economists are coming around to that view. When you look at the data out there including todays wage numbers, is there a case that it is just not that simple . Martha i think theres been a lot of discussion about the phillips curve over the last two years and in some ways it is a similar story. Weve had so much room to grow. We are still waiting for wage growth to pick up again. We saw a lot of fiscal stimulus last year and that helped accelerate wages. We are seeing that starting to be withdrawn and that wages are starting to hold steady. Romaine do we need to see that wage growth completely across the spectrum . If you go into some of the ,ndustries that have lagged those industries do start to see some sort of wage growth. Im wondering why that gets discounted. Martha i do think there is always going to be specific factors in different industries. You have seen different wage dynamics in industries where there is a threat of workers quitting. That being said, if you look at wage growth in lowwage industries, high wage industries, in general you are not seeing that continued acceleration. Joe you tweeted out some charts today breaking down the report, some of them really caught our eye. I want to talk about the volatility in goods producing jobs versus services. Privatesector Services Growth is really steady. Goods is way more volatile. What is the approximate cause of this . Ofthat just reflection Global Economic weakness . Martha i think so. That is a sector that is susceptible to headwinds from trade war and was really outperforming last year. Seen sort of this resiliency in consumer spending, but we saw that one of the laggards was in the retail trade. Explain what is going on there. Martha retail trade has been struggling for a while. And a lot of that is the threat of competition from ecommerce. When you have a sector like retail that is struggling in an economic environment like right now, that is hugely different for workers. Despite the job losses, we havent seen a jump in the Unemployment Rate. Joe at the beginning of our conversation, we were talking about Larry Kudlows assertion that the phillips curve doesnt really make any sense. Before we can talk about whether that model makes sense, we want to have some idea of how to measure labor market tightness. The Unemployment Rate only gets us so far. At primes to just look age workers, people who arent at retirement age, and you are looking at prime age population employment and you want to see that going up, but it is not. Martha yearoveryear it is still going up, but the rate has been slowing down. That maybe suggests that we are starting to tap out on the people we can pull into the labor market. People this idea that are coming off the sidelines, is that not the case . People are still coming in off the sidelines, but there may just be fewer than a year ago. We had gangbusters job growth and at one point the labor market has pulled in all the people it can pull in. Joe i always hate when people caveat every report, but we did get a bad report last month. This month, a lot better than expected. At some point, do you just average it altogether and not get hung up on what anyone says . Martha if you look at the threemonth average, we are getting a clear message from the labor market that job growth is lower than it was last year. But we are still seeing very solid job growth numbers. Romaine always great to have you here. Always great to have your charts. That is martha gimble. Coming up, greece heads to the polls on sunday. How the pages are being turned on a popular experiment. We are going to talk about that later. This is bloomberg. Romaine greece is heading to the polls this sunday following the prime ministers recent defeat in european parliamentary elections. Meanwhile, the pages are being turned on a populist experiment. Lets bring in maria from brussels. I sort of understand why tsipras is falling out of favor, but can you give us insight into his main competitor and what he is bringing to the table . This is a fascinating story. Im sure you remember, this was a shock to the system. Greece almost tumbled out of the euro. Four years after, the greeks are expected to vote for im actually headed to athens. We interviewed him. This is as mainstream and establishment as it can get. He is from a political dynasty in greece. He is pro, centerright, and he said, i want to grow the economy and cut taxes across the board. The greeks are saying goodbye to the populist experiment and returning to the mainstream. Joe i remember when tsipras was first elected and there was a lot of anxiety in how he was going to play with the rest of europe. Assuming he loses, his relationship with the rest of europe is pretty good these days. Hes not going out as a major antagonist. Totally. Hewas seen as a rebel when held the referendum and im sure you remember varoufakis showing up to brussels, defying everyone. All that is gone. Someonehas now become who is much more tame and when you talk to people in brussels, they think hes just like another politician. In greece, that has kind of killed his election performance. A lot of greeks tell me there is no difference between tsipras and someone like mitsotakis. Frankly every kind of breakthrough that he promised, he has failed to deliver. Looking at the market reaction, the markets seem to be thinking that mitsotakis is going to be the winner. Youve seen a huge rally in equities and in the bond markets. Im wondering, is this going to be a close contest or pretty much a done deal . If you look at the polls it is pretty much a done deal. The question is whether this is that to be a supermajority sees him in power. In terms of the market, everything has been priced in. Mitsotakis has said, i want to cut taxes, to renegotiate targets, and attract foreign money. The question he may face is that the European Commission is already saying the greeks are lacking and they need to speed up. That could lead to some tensions, but that remains to be seen. Romaine thank you for joining us today. Coming up, democratic president ial candidate Elizabeth Warren is winning respect in an unlikely place. We will explain what that means. This is bloomberg. Lets get the first word. The Justice Department hasnt yet decided how or whether it will move ahead with lands to include a question about citizenship on the 2020 senses. That is according to a government filing. A federal judge in maryland has given the u. S. Until 2 00 p. M. Eastern time today to say whether it wants to include the question. The u. S. Was vague and offered little clarity. President trump is reaffirming his views that a fed Interest Rate cut would help the economy grow more quickly and says central bankers dont know what they are doing. The president spoke to reporters at the white house today. It would be like a rocketship. But we are paying a lot of interest and it is unnecessary but we dont have a fed that knows what they are doing. The comment came on a day when the u. S. Reported nonfarm payrolls growth in june of 224,000. That is the most since january. Stream of aftershocks has shaken Southern California following the strongest earthquake in 20 years. The quake struck thursday in the mohave desert, northwest of los angeles. Multiple injuries have been reported. Emergency crews are also dealing with gas leaks and reports of cracked roads. In greece, hundreds of firefighters are battling wildfires. Officials say a man has been arrested on suspicion of starting one of the blazes by burning dry weeds near his house. That is band from may through october. Global news 24 hours a day on air and at tictoc on twitter powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Joe as the race for the white house heats up, joe biden beginning to draw contrast with his rivals. The 2020 candidate making his case following a fairly rough debate performance. Lets bring in kevin, a democratic strategist who advises the Democratic National committee. He joins us from washington. I think conventional wisdom is that biden is still the front runner, but a pretty damaged front runner after that debate performance. In your view, does he have what it takes to reset and strike back . Great question. Thanks for having me on. The debate performance was a little rough. He spent the next day kind of explaining himself in chicago and hes been doing damage control ever since. He is sitting down with chris cuomo. Theyve been teasing that interview tonight. Speaking about kind of coming back on the bussing issue. Question, you are seeing his polling take a dive as Kamala Harris and Elizabeth Warren are inching up on him in these polls. Romaine kevin, when we talk about some of the voters, particularly the black voters, there does seem to be a divide in terms of generation, wi