Points and now is maybe 100 points higher. Part of that had to do with oil. Oil really lost steam in the middle of the day, kind of tracking stocks down a bit with it. But the nasdaq, that was a big winner of the day. In part because of apple ,onceding its best rally rallying to a threemonthtracy you mentioned oil just then. I want to bring in currencies because we are seeing a move in the dollar off the back of yellens dovish stats from yesterday. Fiveyour local man off the back of that we have the emerging market currency rally specifically being led by the russian ruble at the moment, which is really having a big, big jump against the u. S. Dollar, and of course, the brazilian real. Alix we had volatility in the currency market but not really in stocks. This cool chart comes from Oliver Renick and it basically looks at the close to close absolute value of the daily move in the s p. That redline their means a 1 move. March has just seen three days with at least 1 change versus february, which saw 10 moves of 1 , and january has 13. Really interesting way to illustrate. Tracy im so glad you brought that up because we will be talking the difference between stock and volatility later on in the segment. Alix there you go. How about treasuries . Tracy all right, bonds were interesting today. Lots moving in treasuries, off the back of yellen. We saw treasuries falling because we had this rally in risk assets but the action today was outside the u. S. If we go all the way to ireland, we saw ireland actually selling its firstever century bond, a bond with a 100year maturity for yield of 2. 35 . Alix oh, my gosh. Tracy Something Else yielding 2. 35 last year, u. S. 10year treasuries. Alix investors would rather put their money in ireland for 100 years. Tracy amazing turnaround. Think back to the eurozone prices. I wish yields on the 10year or Something Like 12 or 14 i wish yields on the 10year were Something Like 12 or 14 . Alix fixed by higher into the inventory numbers. To a 3. 5 gain. Part of it was the dollar. It rebounded from the fivemonth low. Also, there was doubt that any kind of production freeze would be nullified. Kuwait and saudi arabia are starting a production again in the neutral zone. What do you believe, what they say are what they do . Tracy exactly what the market doesnt want to many hint that the supply what is going that the supply glut is going to continue. Alix you can follow all of the tricks using the function at the bottom of your screen. Im looking at crude positioning tracy of course you are. Alix and how that might influence prices in the short term. Here is what we have. We have the white line, hourlong sp our long specks coming into the market. You can think of these as etf investors. The green line art merchantlong positions and they are very, very low. Traders are actually shorting quite a bit. They are hedging the inventory that is stored right now by selling contracts short. These are the very strong positions we have on the market. Says anyn over at citi unwind of these three things can cause volatility in the market. For example, if the hedging unwinds, do you buy back the short positions . The merchant positions can spike up and boom, you have a rally. Same thing with the specs. This will wind of dominating oil prices. Tracy it could go either way based on position at. Hat is an interesting chart im looking at something slightly different. I have on my screen what i will call the dash for trash. In the early part of this year we had a huge assault for riskier assets junk bonds, leveraged loans, limited partnerships, the pipeline operators in energy, and emergingmarket currencies. Take a look at the chart. You can see how strongly evident has rallied off of the back of that. A lot of that has to do do with the dovish statement we saw from the fomc in march and yellings yellens speech will lend that were in the district alix do you want to see that . Tracy the big question is what has actually changed in terms of the fundamentals compared to the start of this year. We have a lot more central bank stimulus, but other than that alix that is not going to help the u. S. They im not saying fight fed put in terms of the fundamentals, maybe. You can see all these and more on twitter. Here is Oliver Renick. Ey, oliver we just showed the dash for trash chart. Why you seeing something similar in terms of stocks and Risk Appetite . Oliver perhaps. We were asked earlier about Short Interest in stocks and where people are getting short and to some extent they can be short in this market. There has always sleep in a lot of covering and whether that is something that can sustain or keep prices going upwards as a result of people covering the positions i think is starting to become a harder case to make. If you look at what is been the past couple of days, it has been a market that is slowly gone up, up, the bulldged market we have talked about it and the strength in the market has been a good example of that. Yesterday we look at this big statement from yellen, which was extremely dovish. Brought up the idea that if you get deep into the tech, the possibility of reversing here at these are these tools that we have that worked previously and have been floating that out there in the markets like it a lot. We have a chart looking and basically the fed funds expectations for june versus the s p. We have written about this type of thing before where you see the market and the expectations move pretty closely together but basically, if you look at that overtime, the market gets weaker, the s p gets weaker, the fed funds move with it in terms of what the market expects. Expectations for the fed hikes have been a lot lower than what the fed has indicated throughout the year and when you look at what has happened in terms of just the past 48 hours here, you basically have the fed funds expectations for june going way down from 40 to 20 and the market getting a nice boost. I think that signals to have a market that is very much reliant very much like the news, whether or not it has been the source of all the gains in the past month, again, you can make the case either way here but it is clear that when you see the big moves and the way spreads across, it tells me the market likes having those lower rates and they have been in line with what the fed is saying. Alix yellens dovish this was predicated on a lot of potential risks to the u. S. Economy. All we got to the old marketplace where bad is good news . Oliver . Sleep bad news was we missed their jobs number or the wages are creeping up more than expected but if the bad news is the bad news we are looking at with the Global Economy really slowing down and earnings just collapsing, then i think that is that is that ultimately does that is bad news that ultimately that that is bad is that ultimately wont be good news. If they are doing that based on weakness here or at overall concern about global growth, i think that is that event. If you look at i think that is bad. If you look at this table, earnings expectations with disorder, it is astounding. Ive been on vacation and when i connect i didnt like how far expectations came down for the quarter. Alix this is a big fear, the profit recession idea. The earnings keep getting ratcheted down. Quarters with weak Earnings Growth contraction, rather. Now you have a quarter you where you are taking 9 contraction and Earnings Growth. If you look at what sectors have flipped the most, i went to last joan and somewhat analysts were expecting for q1 16 at the time. They were expecting a 7 gain in earnings on the quarter versus 9 now. For the second, they were expecting energy and materials and industrials to be positive earnings at this point. Guess what, we are nowhere near that. We are looking at a contraction of 22 , 100 down from the year before. Moreover, it is happening in a bunch of other sectors, too. Six out of 10 have flipped in terms of analyst expectations for positive earnings to negative earnings, and tech is a big one of those and think that is concerning. Alix what about retail . The u. S. Consumer is supposed to be the power house of the economy. Is that holding up . Oliver in terms of profits it is not looking totally great. ,n terms of the Economic Data there is a lot of people who will make the case that things are Getting Better and wages are starting to creep up. People will have more money to spend. That is one of the sectors that has been a big concern for the markets because things were getting week in january and february and people were moving towards the defensive stuff and out of those discretionary names. They wanted to be in the stables and utilities in the telecoms, the only stuff that led the first two months of the year and close to three. It is hard to really say from the Economic Perspective how much how much strength there is going to be from the consumer , but from the Equity Perspective you need to see a lot more strength in those names to inject a lot of confidence into the sector. Alix thank you so much, always nice to have you on. Youre talking to lots of people and following the market closely. Coming up, u. S. Treasury secretary jack lew sounding the alarm on the brexit. For global economies have recently. U. K. Leaves the eurozone. Mark i am a mark crumpton. U. S. Secretary general ban kimoon says u. N. Secretarygeneral ban kimoon says the United Nations is very appreciative of political efforts to address the refugee crisis. He discussed a deal with turkey on a newly arrived refugees who will be sent back while the eu recitals more refugees. I think it is clear we need to be seeking solutions, Solutions Based on shared responsibility. I have been calling for countries to Work Together in the spirit of shared responsibility. The key to this agreement is implementation. Mark he spoke during a joint News Conference in stockholm with the swedish prime minister. The paris Prosecutor Says a french citizen arrested last week has been charged with plotting what is called an imminent terror attack it Officials Say the suspect participated in a terrorist group with plans for at least one attack. He is also to serve processing and transporting arms and explosives and holding fake documents. The airport in brussels, belgium, will remain closed to passenger flights at least until thursday afternoon. It has been out of operations since last weeks terrorist attacks. Once the airport reopens, arriving passengers will be sent to a hangar to collect the bags. Global news 24 hours a day powered by our 2400 journalists in more than 150 news bureaus around the world. I am mark crumpton, tracy, alix . Alix thanks, mark. Whatd you miss . Thatt is going to be for the economy, running to secretary jack lew in a charlie rose interview. Youetary lew i dont think will be good for the u. S. Economy or the Global Economy. Charlie what is the impact . Secretary lew partially economic in terms of trade and economic relations and partially geostrategic in terms of holding onto unity and in a world where one of the things that drives the economy is the uncertainty of geopolitical risk, it was interesting at the g20 minting the risk of the brexit is something that people were talking about charlie talking about it in china when i was there over the weekend. Secretary lew is that something you can measure with the economic index . No. But the unease and economic consequence . Yes. I see all caps customs about what it means for the british economy and european economy. All kinds of estimates about what it means for the british economy and european economy. Charlie and youth unemployment. Secretary lew huge youth unemployment. Anything in the wrong direction would be destabilizing. Catch the entire interview tonight on Bloomberg Television at 7 00 p. M. Eastern time in the u. S. Here on Bloomberg Television. Tracy the british referendum date is months away but investors are finding ways to hedge the brexit risk. Bank of america is recommending selling the eurodollar as a cheaper way to short pounddollar. This is pounddollar volatility, now i do record high. That means the pound has tumbled 2. 3 this year. For the process of integration or disintegration in europe, it also raises the risk to some degree for the Global Economy as a whole. We dont think it is going to happen but people are concerned going into june. Alix tracy is one of the Conspiracy Theory lovers from looking at mycy i am going to wear tinfoil hat on the air. [laughter] no, janet yellen talked a lot about china and the Global Economy. If you look at the chart we prepared, you can see Market Expectations of Interest Rate rises moving closer to defend sorry, i should say vice versa, basically Relationship Building in the market and fed expectations. Is janet yellen and the fed now the central mike of the world now the central bank of the world . Not the central bank of the world as a whole but they do important things. Shanghai puts a seal on something and the fed has been a lot more open about viewing the dollar as an important part of u. S. Monetary conditions. They have done that for about a year now. They are also much more conscious like the bernanke fed of the way that could tighten conditions Dollar Strength could tighten conditions for the rest of the world. That is important. A variant quinton part of this is much more confident about reaching its unemployment target. At the same time, they worry reaching the inflation target and i suggest that is because they think we have a series of Global Factors that push down inflation even if the u. S. Economy is fine. Alix which implies that janet yellen is willing to tolerate inflation to stave off deflation and the rest of the world, which it seems like a world central banker kind of move. Karthik he does to some degree, except were not close to that. Core pce is 1. 7 . Goingd projections see us 2 years and we still dont get to 2 . Perhaps some parents of conspiratorial fashion they are thinking we could overshoot but i would suggest it is the other way around. They believed is inflationary portions for the rest of the world are Strong Enough that they will hold down inflation even if you have u. S. Wage increases, and since 1994 uf had a strong correlation. Speaking of the Global Economy lets go back to brexit for one second. You think that if the u. K. Remains in the eu that could be bad for the u. K. Economy. Karthik for politics and economics, and that is because of the concessions that might be made to the you take that to the u. K. To stay in. It is based on the underlying idea that what europe needs financially more than anything else it involved some degree of neutralization, some degree of federalization, some kind of risk transfer. All of these steps bring forward were raise fears of european superstate in british minds. Our argument is that those things become harder, if britain is in, because they keep pushing for more repatriation. Conversely, what is given to britains acceptance that the eurozone is a multicurrency area. The idea that the ever closer union is not the fundamental process in europe. That makes the argument is needed to stabilize the euros and much more harder politically within the eurozone countries. If we have a fed meeting weeks before the referendum in the u. K. , do you think janet yellen is the ground being like, guys, we have to hold off because there was a big risk for the Global Economy and for your . And for europe . Karthik that i am not entirely persuaded about. One of the things that is not appreciated by the market is the large difference between the financial dollar and the tray dollar. If you look at the dollar index that everyone except on that is eurosercent euro 70 and sterling. Trade weighted dollar is only 20 euros and sterling. What you get in the immediate aftermath of it is some pressure on the dollar, some pressure on the euro. Is it enough to hold the fed back . Im not sure. You would see more traumatic events. Potentially a significant in bank debt those of things you need to look at. To see yellen hold off yet again , or you need to see confluence of other events occurring. If the fed is inclined to be more dovish or not, i have yet to see that. Stock and currency volatility is now at the lowest on record. Next, a chart you cannot miss. Tracy im tracy alloway. Whatd you miss . The difference between stock and fx volatility is the lowest on record. Curiop dive is a market presented for your enjoyment because i dont know what it means for markets. Here is the vix volatility index. Market expectations of future volatility in the s p 500. My below it, i think it is Deutsche Banks current volatility index. Measure of expectations. You can see that the spreads between the two is now at a record low. Again, i dont quite know what to make of that. It does suggest me that fx volatility remains reasonably high. Maybe the currency wars to live on to some extent . Alix it is about centralbank action at the end of the day. Than inhave more juice the equity market that is what we are seeing. Tracy im short brexit risk is an elegant alix isnt helpin. Alix good point. Im looking at brazil. The curve of the swap that will expire in 2017. This is the market telling you what the Interest Rate will be in brazil. The markets have we rated down by as much as a full percentage point cut by the end of 2017. Basically, markets are telling you that Dilma Rousseff is going to go out and be impeached and the central bank will have the juice to be able to do Something Different and help fight the recession by lowering Interest Rates. That green outline is what the expectations were on march