Below 60 estimated by analysts. That is a ninemonth low for that reading among u. S. Homebuilders. We are seeing potential buyers staying away here. We see progress in the real estate market. This is a stutter with in that. This is typically not a big market moving number. We are seeing the rally in u. S. Stocks that does remain intact at this present time. Particularly buying in asia and initial buying and oil, though that has faded to some degree. Take a look at the imap on bloomberg here. A rebound in information technology. Thingsbeen one of the that has held back stocks this year. Financials are coming back as well. If you look at the angst, we are seeing a rebound continuing today building on fridays gains. A backtoback rally for u. S. Stocks. Goldman sachs and citigroup also building on fridays gain. I mention oil prices. Lets look at oil now. We have seen the rally earlier ay on the city to for decision to freeze production by saudi arabia and russia. We will talk more about that in a moment. Were hopes, at least. How realistic is another question, but hopes there would be a production cut. It means oil is not holding onto the gains. Brendan we are looking at a twoday rally. Does that mean we have found the bed . The senior equity strategist over at wells fargo was out saying perhaps we have seen signs of what she is saying is capitulation of the markets. Has perhaps found a bottom. One other chart she is looking at is investor sentiment, news iiter sentiment as measured the association of Investment Advisers here. This and bullish sentiment in white here. Was lowerh sentiment before market bottomed in 2010 and 2011. Those are lower now, lower than in the two times we saw the market bottom and then rebound. In other words, it could be a sign that we are starting to see capitulation. The top line is the s p 500. She is looking at some Technical Levels and other things pointed her in that direction. You. An thank we will head over to the first word news desk with vonnie quinn. That ets keep some headlines, new Satellite Photos show china has expanded island Building Activity in the south china sea. It shows a base under construction. Asian leaders in southern california. The u. S. , and taiwan, among those who complain about chinas actions. Mr. Obama will hold a News Conference today. Duringe will be provided what did you miss. The Islamic State facing a major budget crunch and struggling to meet expenses. Inasked residents blackmarket american dollars and released detainees for the price of five 200 other measures have eroded from their finances. Bars and energy drinks. Tragedy and russia. At least six people are dealt are killed including two children. The government released drone footage of emergency workers. Of a fivestory building came crashing down. An investigation is underway to determine the cause of the blast. Crash inon train southern germany last week was caused by human error. 11 people died and four were injured. The singleline track 40 miles southeast of unit. Pope francis is in mexico where he announced the exclusion of indigenous people. The pope has two the city in an area played by gang violence. Global news 24 hours a day powered by our 2400 journalists around the world. Brendan we will get to the big story right now. Saudi arabia and russia agreed to freeze oil output at current levels. Prices initially gained but then back down, the s p fluctuating negative on the day. Joining me to explain the deal alix steel. Look at that. We can call ourselves what we want. Deal, pseudodeal, where are we . Alix it does not mean it cannot become a real deal in the future. In saudi arabia. Already freezing production at current levels. Plus, cutter would have a difficult time ramping up reduction anymore. In essence, they are agreeing to something that already happened. Facto, they have to freeze it. That is why i am saying state deal. The materials are happening in the margate. The real test can come in the summer were saudi arabia ramps up consumption to meet domestic demand. When it does not, that is on the freeze could actually mean something. It will not really work unless we had other major producers participating. Iran and iraq are the ones were waiting for. Iran has said they will not freeze production until they ramp up to presenation levels. A want to export 1. 5 billion Barrels Per Day by march. Iraq has not said it had it would cut back at all. Why would they want to do that when they neither money . Brendan lets look at the terminal. There is a function. If we jump into the terminal, we can look of the dashboard of where we are. I will click on something you alerted me to earlier today, the total crude Oil Production out put. What we are seeing is a little bit of a flattening just barely in the last month. Is that significant . Is a little lower by a couple hundred thousand Barrels Per Day. We wind up having an oversupply of 2 million Barrels Per Day. The stock gold for the First Quarter was over 2 million Barrels Per Day. A lot of oil needs to be taken off the market for this to mean anything. Get thee hike would shale producers in the u. S. Back to work him because they can say, great, i can hedge now. My breakeven is better now. That is another risk. Saudi arabia will not want to do that. Brendan on the desk, we will take a look at more oil. Mike, you know, alex just called this a fake deal. Is it a fake deal . Mike i agree because expectations were that russia and saudi arabia would not increase outputs anyway. Saudi arabia and iran and iraq and russia. Iran and iraq only meeting tomorrow. There is no sign iran will do anything. They put out some signals today but they have been saying in the last month or so, we are going the other way. The market has been chattering about this for a month. The market wants to see a cut. This could be bearish. It does seem like the first step is to figure out how to talk to one another. Are we looking at the possibility that saudi arabia are open to Communication Channels and have recognized they have the same interest in this. Is that something . Mike there was a highlevel delegation during 2015 from saudi arabia and russia, going over next month. Russia has softened their position a little bit. They would not even consider you having a discussion. Have signals you are willing to talk about. Brendan to the point just made, were looking at how do u. S. Producers respond. If this even achieves a basic floor on pricing, that is good for you as producers. Mike a floor at 30 give or take would still cause steep budget cuts among u. S. Producers this year. The issue is almost the other way. Hypothetically, say we get a 5 cut talked about a couple weeks back, i do not think that will happen but hypothetically, if it at 50 andill be back heartbeat and in a couple of weeks, i would say. Then it will not go down this year. Brendan the mediumterm outlook for the price of oil, and did that affect that all . Mike mediumterm being a few years out . Forecast m now the that based on brent. Global rebalancing is on the way. Stretchmaybe a bit of a. That is something we will be doing for the next two hours. Is your focus on demand and not supply . Mike we want to keep our eye on the ball with demand. Still supply side, specifically the u. S. , that is key. Do you have to focus on politics more than you used to . Always focused a lot on politics. Company by company, on Equities Research side, really, what do the spending cuts really mean, that is a level of detail we have always gotten into in the past. I am curious about opec. Will we ever see opec again . Mike i think we do. First, we get rid of the overhang. As the markets tighten up, that is the queue for the saudis and start spending again they want a goldilocks world of 70 or 80 and do not want to go back to 100. Brendan mike is the head of oil research globally. Much more coverage of the story throughout the day, including an interview with jeff, head of Commodities Research at Goldman Sachs coming up at 4 00 p. M. Eastern time right here on Bloomberg Television. Brendan justin anson and skill justice antonin scaliass unexpected death shifts the balance of the Supreme Court. Lets ring in greg, who has covered the Supreme Court for 18 years. He joins us now live from washington, d. C. I was taking my son to basketball rises and then everything changed. I want to talk about what is in the president s right now. It is unlikely he will state who but who do nominate, we think is on his short list given the restrictions . Greg i think it is a complicated choice. It could be someone who ultimately ends up basically as a sacrificial lamb. People the president will probably be considering at least in part include a lot of the younger judges he has that on a federal appeals court. Isudge here in washington born in india. , he is in california black, also in his late 40s, he will be on the list as well. President wants to compromise, a judge has been on the court much longer, and then there are outofthebox nominees like the attorney general, i do loretta lynch, someone who has been talk about a good deal. She would be the first lack woman on the Supreme Court. Brendan these are people who have all been confirmed by the senate in some way before. The politics are important. Greg they certainly are. They had a benefit with the thele i mentioned, at least ones nominated recently, that they have invented, and christina was confirmed unanimous we by the senate and obviously went through a difficult confirmation process and got through. And know what they have they know these people can stand up to a senate hearing. I have heard a lot of people talk about who seems to be the top of everyones shortlist. But his record on the d. C. Not one of a is flaming partisan. He seems to be more of a consensus type candidate. Is it possible to describe him that way . Based on what we know. There iss there are some things that make the democratic race skeptical. He has been a business lawyer, he represented exxon. Credentials. Ss he was supported in the obama administration, so that is an indication this administration has some trust in him. Walk me through the precedents of nominating the Supreme Court justice in the last year of august. Differently. Ed is there such a thing as a president not nominating last year or it is the basis . Time the last the last we had a vacancy on the supreme and nomination that could be made, was back in 1968. Someone then, there was still in place. Earl warren would not move until a consistent successor would be formed. Find a time where, on election day, new president was elected with a vacancy on the Supreme Court, and that was abraham lincoln. We are low on time but i want to take a look at the docket. What is the court looking at right now . Forecourt means they cannot set a nationwide precedent but they can confirm conservatives want the court Public Sectors Workers do not have to pay for union representation, that they have a freespeech right. It looks like the court would say that here that will be a huge decision. It is hard to count to five votes there. Other cases that could be affected include the power plant case when the court eventually takes that up, probably next term. They have abortion and affirmative action and immigration. A lot of cases could be affected. There has been a strategy i heard thrown at the which is that they have been very eager to move cases through the courts to lose on the way to get that 53 Supreme Court it are any of those that kind of strategy right now that might have backfired . Do not know they will backfire in the sense that, for example, in the union fees case, it right now looks like a fourforce it. If true, that would mean basically nothing changes. So they tried and it did not work here there are other cases where conservatives might well lose. The abortion case, just as on abortion clinics, the result of the case may not change. It just may be instead of a fiveor decision for abortion rights, and a end up being a 53 decision. Washington. G in plenty is still to come on that issue. We will continue to come back to you and we will hear more later on this story one president or you can a press, watch on Bloomberg Television radio and at bloomberg life go. Stick around after the presser. Lumber Politics Team will talk about Bernie Sanders on with all due respect. Brendan time for the Bloomberg Business flash, a look at some of the biggest business stories in the news right now. An audacious idea. City analyst say they should by aig and turned into a lab for innovation. Aigs eeo compared his company to google and that the insurer may sell or spinoff off some of its units. Phasing out its universe tv service and pushing customers to sign up for directv. At t has quit holding, part of the plan to compete with paytv. Property developments are calling it a one time onceinalifetime deal. Three Properties Located in an area of rockland in high demand, one right next to the brooklyn bridge. The buildings may bring up to 900 million. Wet is your business flash will head to julie hyman, who has a check on company movers. Julie i mentioned stec is coming back today to tell a look at a couple of examples of that. This group is also one of the big reasons stocks have underperformed this year. They are widely held and have been dragging down on major averages. Also, we are looking at some of cornell companies, looking at earnings and raising its forecast for the full year. It has been seeing issues in his turkey segment and it says the turkey production is on pace to norma normalized levels to the end of the second quarter. Strategic 190 million Capital Investment plan. Those shares are also on the rise. Meat companies are doing well today and were looking at the drugmakers today. Bristolmyers could gain 25 . The company is unfairly weakened recentbroader selloff in months, the company says. It also announced a collaboration with the cancer if it to on drugs. Also, it is said the fda has approved two supplemental medications for hepatitis c. Other of those shares are rising. Brendan you sent me down a rabbit hole. Im looking for various ways you can prepare spam on the internet. Will sendecipes and i them to you. Still ahead, the health of the Housing Market. We will look at how housing is holding up. Vonnie three americans inducted in baghdad last month have been freed. Reportedly handed over to the u. S. Embassy in baghdad. Iraqi officials said they expected one of two powerful shiite militias was behind the kidnapping. Former president george w. Bush is campaigning toward jeb in south carolina. Mr. Bush did not mention donald trump by name. He did say that the loudest person in the room is not always the strongest. A planned parenthood clinic reopened in Colorado Springs about three months after a gunman attacked. Three people were killed, nine others were wounded. In the case calls himself a warrior for the babies are co getting rid of mosquitoes spreading the zika virus, one of those, genetically genetically modifying the male mosquitoes. This has been criticized in the past. The missing malaysia jetliner is missing a milestone. Weeks from becoming the biggest unsolved mystery in a most it decades. The hunt may and in the indian ocean in june. Discovered was thousands of miles from the search area. The i am vonnie Quinn Brendan . Recession obsession. To be easy. All you had to do was look at the bond market. Investors are thinking the bond market is not doing what it used to do. Here with me is the Bloomberg News treasury reporter. Hello. The yield about curve. Looking at this article, let me see whether i understand it. The yield curve is flat and gives us no information therefore whatsoever. A step back. The yield curve for years has been the best single predictor of where the economy was heading. What people are saying now is that that has changed. It has changed because of centralbank policy. It has changed because Central Banks have kept rates at zero for so long. Then you get inflows from foreign investors. Factors helped keep treasury yields very low. People are saying the yield curve will not invert. Before a recession and since the 1970s, the yield curve has inverted. Shorter term yields move higher than longer term yields. People are saying that will not happen because of where the fed funds rate is for an extended time. Brendan it used to be the basic yield curve looks like this. If it is inverted. Shorter term yields move higher than longerterm yields. Brendan if it is flat, could that mean we are just going to be in a low growth environment for a long time . Susanne and that is what people think. They say the yield curve is flat and it is not indicating recession. People are saying, because it is not adjusted, for fed funds being so long so low for so long, that is why it is showing a flat yield curve. Bank of america says using an internal model it uses to adjust to the nominal curve, bank of america is saying it is inverted. A likelihood of a recession in the next 12 months. You have got bank of america saying this. Td is using their own variables, saying there is a 50 chance. At 10 andt jeffries goldman at 18 . You have got all of the wall street analyst ratted just, these are the experts and they are not agreeing on whether we will see a recession or not simply because the yield curve is not doing what it has traditionally done. Brendan we have got a function on terminal that does a far better job at my inadequate to human arms. The yield curve, if we are theng forward over time, yield curve is slowly flattening but there is not that Much Movement at all. If this is what is going on, one of two things is possible pair one is low growth and the yield curve is right. The other is they are no longer sending us useful information