Huawei. The s p 500 down 0. 9 . Dire Economic Data followed by confidencey good data, according to the Michigan Consumer sentiment data. But we are checking the innards of those data to see what is going on there. The 10 year yield at 63 basis 28. 53, up crude at a good 3. 5 today. Lets get to europe. Germany plunging into recession, gdp falling 2. 2 in the first quarter. Bloomberg has been speaking with executives of German Companies about the pressures caused by the pandemic. Have a listen. The times are turbulent and they are complicated. The real question everyone is asking, how quick will be recovery come . The uncertainty remains. There is still very much uncertainty, so from that point of view, we remain kind of cautious. I think it is too early to call an end to the globalized world. We assume a ushaped in area into year end. We are presuming recovery on the one side, which is important. We dont know exactly how the restart and the unraveling of the current lockdowns across the world is going to work. There will be a time after corunna. After corona. I always say to my people, the night is darkest before the dawn. In our lets bring correspondent out of brussels, maria tadeo. Germany is a lot better than the u. K. , but the slump is pretty phenomenal. Talk to us about the context of it in terms of other European Countries gdp data. Maria you are looking at 2. 2 contraction. This is the biggest economy in europe. We always look at germany because it does have big implications for the rest of europe, and it is true that you are seeing an economic hit. This is not good for german industries, and probably not going to be good for exports. At the same time, we are going to see the fallout into q2 because the lockdown was already in place, and the easing of the lockdown is being done very gradually in europe, precisely because the governments here are worried that we could see round two of coronavirus, and that could be even more detriment to the economy. But when you compare germany to the italian contraction, to the french, the spanish, those declines were in the region of four to 6 viviana as a compare of 4 to 6 , so as a comparison, germany is doing better. The french lockdown was not as severe as germany, and also came out later. The were able to keep economy going for longer. Vonnie finance ministers our meeting as we speak. What can they come up with . What do we anticipate they might say . Maria we are still waiting for the big stimulus package that they have not really been able to translate into anything significant on paper. Theres been amounts that have been floating around for 500 billion euros, but the problem is that european leaders do not really agree on this. Finance ministers meeting today actually dont have a lot to work with, and we are not really expecting anything to come out of this. What is interesting, however, is the state a discussion. Theres countries that will be able to prop up their companies and bailout a lot of the companies. Weakeru hear from European Companies is they dont want to be in a position where they are not able to defend their own industries, and this could potentially create a twotier recovery. That is the concern, that you can see weaker countries and then strong countries, the european economy early split. Not a that is definitely new idea by any stretch, but a very dangerous path to go down, as we know. Talk to us about this story we have been breaking over the last hour or so, that lawmakers are looking to maybe remove some redtape and scale back regulations that had been being put in place since the financial crisis. Maria yes, and this is such a uturn from what we had been seeing from european authorities. I am sure you remember, it is very new. This took a long time to be able to enact. We already knew the industry was not happy with it. They actually felt that this increased the cost of doing business, and there was a lot of paperwork was essentially a burden for some of these companies and banks that had been for a while now saying that it should be revised. We now understand there is a discussion perhaps to roll back some of the elements to allow these companies and institutions to be able to feed more into the real economy, to be able to kickstart the recovery here in europe and do it quicker. It is something that actually feeds into the narrative we are seeing from the you now, saying the old rules should not really apply in this situation because it is such an exception, and this is such a huge shock for the eu. Vonnie is it possible the ministers will Say Something about that after todays meeting, or is that not on the agenda . Maria they could be asked about it, and this is something that we understand is not really official. It is not in a stage that is ready to be signed off. They could be asked about this today. They could also signal, perhaps not going into detail, that they are at least willing to reconsider and perhaps cut down the redtape if that means europe could have an advantage over competitors, but it also means that some of these countries that have been so badly hit could actually get going much quicker. This is really something that would not find a lot of opposition to remove some of the hurdles, if that means the recovery would happen quicker because ultimately, that is the goal here, that we can get back on track quick. Vonnie speaking of back on track, i want to move to britain because brexit negotiations are ongoing, too. We are now seeing rhetoric heating up once again. Michel barnier out in the 80 talk our in the 8 00 hour saying he is not optimistic about brexit talks. We are at boiling point once again. Maria and this is a negotiation that is definitely not on track. The two sides are now saying all of the sticking points that were problematic just a few months ago, they continue to be. Negotiations have been ongoing, but we havent actually made any progress, and that goes all the way from fisheries to what to do with a level Playing Field but the europeans are pushing for, and the European Court of justice, which politically is very toxic and very complicated. The two sides today took a really pessimistic tone. They say while we are running out of time, they are not really changing the redlines. U. K. Has repeatedly said it is not going to ask for extra time to get a trade deal, and that means perhaps that by the end of the year, we could be in a situation where there is no trade deal at all. Theres still another round of talks scheduled in june. That is seen now is a make or break moment, but you do have to factor that these negotiations are difficult to do just from a logistics perspective because they are not able to travel. The teams dont see each other. They dont come to brussels. They dont go to london, precisely because of the coronavirus. The whole timeline has become really unexpected because nobody could predict that we would be in this situation, where you are not even able to be in the same room. Vonnie maria, thank you so much. Over thebe a busy bee next few months, no matter how much europe stays in renting orchids to reopen area that is bloombergs maria tadeo stays in quarantine orchids to reopen. That is briggs maria tadeo that is bloombergs maria tadeo. Hasking news now, brazil lost another health minister. He has stepped down as the Global Pandemic continues to wind its way through brazil. The Health Ministry is reporting yearly 14,000 new coronavirus ,ases in the 24 hours yesterday and again, this is the Second Health minister that has stepped down in brazil. As you can see, the brazilian real taking a bit of a stance on that one. Strengthening, in fact, and then weakening again. Lets check Global Markets now with taylor riggs. Taylor starting in the u. S. , you are seeing a little bit of weakening after yesterday. We were weaker, and then you had some rally into the close. One exception to this is the russell 2000 after Consumer Confidence came in a little better than expect, so some of the smallcap domestic stocks are doing better, but overall, some of the major averages are getting hit i a slew of that. Retail dropping by the most on record, production dropping 11. 2 . I want to flip up the board and really highlight retail sales. As you can see, dropping 16. 4 in the month. Wells fargo says every category but four had the worst month on record. The only categories that didnt have record drops were vehicles, restaurants, building materials, and on store retailers. Perhaps and nonstore retailers. Perhaps some improvement showing signs that we might be bottoming out. I want to take a look at some Department Stores because they are actually doing better than expected, despite the fact Department Store sales fell 29 in april. Dillards, for example, analysts are looking at the good in the quarter and ignoring some of the ugly that they had. Analysts are really happy that they are aggressively promoting Products Online and cutting prices to bring down that inventory. Finally, we continue to take a look at the sox, the big underperformers today. Foxconn overnight said that revenue in the Second Quarter was going to be worse than the first quarter, so that pressured a lot of the chipmakers. Then again this morning, the u. S. Announced rules to crack down on huaweis ship supply. This is further escalation against the chinese company. It could further freeze out huawei in getting the chips it needs to make a lot of this equipment. Vonnie definitely castigate definitely casting a pall over these markets. Coming up, u. S. Retail sales plunging 16 14 in the headline number in april. 16. 4 in the headline number in april. What will that mean . This is bloomberg. Vonnie live from new york, im vonnie quinn. This is the european close on bloomberg markets. Lets check in on the first word news. Heres ritika gupta. Ritika House Speaker nancy pelosi going ahead with a vote today on a 3 trillion democratic only virus relief bill. The measure has no chance of getting signed into law, but pelosi is counting on parts of it generating pub look support, such as aid to states and more payment to individuals. That could force Senate Republicans into negotiations for another round of stimulus. China is denying it tried to cover up details of the coronavirus outbreak. Beijing said today it didnt know until january 19 how infectious the new disease was. China says it released that information the next day. The Chinese State sounding the rm about the coronavirus according to documents seen by bloomberg, italy will allow citizens to move freely between its 20 regions starting june 3. Retail stores and other businesses will reopen may 18. Another bad month for retailers in the u. S. Sales fell by a record amount for the second month in a row. In april, they plunged to a worse than expected 16 point 4 . The coronavirus cap Stores Closed and americans at home. Plus, unemployment has been soaring. 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. Im ritika gupta. This is bloomberg. Vonnie thank you. After this mornings dismal retail numbers, wall street is searching for a data point that will spark optimism and point to better times ahead. Is it out there . Joining us to discuss is yana barton, equity Portfolio Manager at eaton vance. Can i ask you about the confidence data this morning . It was surprisingly strong. This is something we didnt see at first blush . Yana i think as before, we stated that it is a sentiment figure, so it is sort of a soft line versus a hard number, which is the retail sales. So ultimately, i think right now the market is reacting to the retail sales number, which obviously has been very poor, the 16. 4 decline. That being said, i think there are some bright spots. I think the ecommerce and online, nonstore share continues to be the bright spot. If i just maybe take a minute to highlight how strong that is and how important that category is, it is massive. Just theink about ecommerce in general in the u. S. , it is still about 16 billion of a 5. 5 trillion pie. Even with the accelerated trends month over month and over the past two months, you still have a long way to go, and globally it is 25 trillion. So i think the stocks of companies that are providing the goods and services and the backbone to structural ability to do Digital Payment and delivery and infrastructure will continue to do well, and that is probably the bright spot i would take away from the retail sales number. Vonnie the nonstore sales category, which does include online sellers, was up 8. 4 , but is hard to know how much is pulling from other retailers and how much will be a permanent shift and permanent growth of that pie. You are suggesting it is permanent. Yana yeah. My household is one of millions, but certainly the change in spending dynamics that have taken place today, just as you think about grocery and other deliveries, i think we are kind of entering this Digital World across the board. Think about working from home. Think about how our kids are getting their education, from a social perspective, others. Maybe we can say that not all of it is going to be permanent. I certainly believe that a significant portion of it is here to stay, and i think, more importantly, i think it highlights the importance to focus on growth while the markets will continue to be jittery as this unevenness and a twotiered economy takes hold. I think investments that highlight higher growth, both in terms of revenue cash flow and earnings streams, will remain in demand and command a premium. You have seen that to date in sector leadership, and i think that will remain in place. Vonnie you are obviously running that fund, the equities ,ortfolio, at Eaton Vance Growth opportunities wise. Are you looking at traditional Growth Companies like alphabet and some of the tech names . Are you looking at new companies . Give us some ideas. Yana i think you bring up a really great point, which is growth is coming in all shapes and sizes, and it is not only to traditional growth areas of the market. While Information Technology remains the backbone of it, we are finding phenomenal Growth Opportunities with the health care space. Health care is a perfect example. While it has done relatively better relative to the s p 500 to date, there are areas of the market like life science and med Device Companies that have been left behind relative to the biotech side of the equation, so that is an opportunity for us to capitalize on. And then Communication Services and some of the Consumer Discretionary names, again, while the Consumer Discretionary space was hit the hardest, obviously, given its exposure to leisure, hotels, restaurants, and other areas of the market, there are a lot of other opportunities that we believe here,ansitory, a pause and will remain places to be. For us, across the board, even in industrials, which is more cyclically oriented, there are areas of the market offering that sort of logistics, efficiency, and Asset Intelligence insight, and sort of Smart Technology that is shunned by the market right now, just because everything is being grouped as one area of the market, and we think that is an valuationprovides the support and longterm secular opportunity for us to capitalize on. So across the board, lots of opportunities. Vonnie what about the likes of uber . What happens to a company like uber . Yana a company like uber that happens to be an investment within our focused strategy is one of those sort of new type of logistics companies. It is a tech company or a traditional Transportation Company . It is a hybrid. I also think a company like uber that has the cash and Balance Sheet and liquidity position, and a variable cost structure, certainly at an advantage versus those that have nondiscretionary and more of a fixed cost structure within traditional transportation areas. So again, that is a company from the longterm perspective that has done a ton of work lately. It is one that, again, we think over the long term means a winner. Vonnie i do want to ask very briefly, you have a lot of retailers in there like dollar general, tjx, some of the lowerpriced retailers. Do they thrive in an environment when peoples wallets are cashstrapped . Yana i think there will always be a place for specialty retail. We are in a world right now where usually, the leading indicator to us is earnings stream. We are just at the later stages of earnings reports, and we will see a lot more from Retailers Next week, but i think you will see pockets of strength where those that are providing the omnichannel or double ways of or multiple ways of grabbing the consumer through online or isk up curbside, whatever it , the convenience aspect of it will remain in demand. So i think there is a place for it, and the retail again is not just food and clothing. It also happens to be within the auto space and other areas of the market where theres less of a condition every span. Vonnie thank you for your time today. Yana barton of eaton vance joining us there. This is bloomberg. Vonnie live from new york, im vonnie quinn. This is the european close on bloomberg markets. We are just about five minutes from the close itself. Lets take a look at where european markets are trading. We are higher on the session in spite of dim Economic Data out of germany which showed a contraction of about 2. 2 in gdp. The dax has been the laggards throughout the session. The cac 40 has been the laggards throughout the session. The ftse 100 up 1. 7 . This is bloomberg. Vonnie lets take a look at where european markets are trading as we head towards