Resigned, posting on twitter it has been an honor to serve the president and the country. He will remain at that position until next month. The u. S. Government is banning citizens from traveling to north. Orea this is after all a warm beer died. Otto warmbier he fell into a coma in a north korean prison. And washington and five other powers world powers sided with tehran after a pact of seven nations. Moroccan demonstrators, frustrated over inequality and corruption clashed with police at an unauthorized protest today. Police surrounded the city center and fired tear gas. Scattered into sidestreets. Global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. Im Alisa Parenti. This is bloomberg. Julia live from bloomberg world in new york, im julia chatterley. Joe and i aim joe weisenthal. Scarlet fu is off today. Were counting down to the close of trading. Julia financials under pressure. Industrials, too. Joe but the question is whatd you miss . Spicer is out and Anthony Scaramucci is in after a shakeup at the white house. I love this country. I love the president. It is an honor to be here. Julia the nations greatest lenders are raking and 30 billion, raking i and 30 billion, just shy of 2006 levels. And investors may have a new away fromstay pakistan. We explain. Joe Abigail Doolittle is standing by. Things, joe. We are looking at small declines heading into the close. ,e have the dow, the s p 500 and the nasdaq all lower on the day. The nasdaq headed toward weekly gains. The dow is headed toward a weekly decline. Noting this is the first day in for we do not have a record high for any of the major averages. At oppenheimer, one analyst is encouraged by the number of synchronized runs. He is a Technical Analyst and he has been very, very right in my view at least over the last to give years, having a bullish view on nearterm pullbacks, but this chart may suggest there could be more of a. Ause happy 30year season, but you have the 30your season, but you see the s p 500 has had a tendency to pop higher in the first up and then drop. This year we certainly have the pop. Permissive says the strong he believes there could be a pairing of gains of the s p 500 in the second half of july. It as far as what is moving on the s p 500 today, ladders and leaders, looking at one of the laggards, ge down after the cfo said company profits, outlook for profits is likely to hit the lower end of the range. We also have colgatepalmolive trading higher, and that finally microsoft, interestingly they put up a debtor than expected fiscal firstquarter. A betterthanexpected fiscal first quarter. And then finally, not a very clear risk on risk off picture, but it probably looks a little more risk off on the day, perhaps on the week. We had the 10year yield down to get basis points for the second week in a row. That tells us haven bonds are rallying. Trading slightly higher. And the fix is slightly lower. The vix is slightly lower. Julia thank you very much, abigail. Whatd you miss . Anthony scaramucci has been named White House Communications director. This comes after sean spicer resigned as press secretary. He will leave his post in august. For more, lets talk to our washington reporter. Great to have you on the show. Looking at that press performance, the contrast with sean spicer was pretty acute. He looked calm, confident, smooth is probably the word i would use. How is this announcement and his performance in the press briefing being discussed in washington . You are exactly right. I think he used the right word. Performance. It was differently seen as a performance. Anthony scaramucci was performing not just for the press, but for the president himself who is known to watch these briefings. A couple occasions, he looked directly at the camera and spoke to the president. He apologized for negative things you said about the president. He said he loved the president. He praised him effusively talking about his skills as a politician and communicator, even his athletic prowess. It was clear he was performing not just for the press, but for the president and he was going to try to turn the page from the bungles that sean spicer had run into at that very podium, making a number of gaffes. It appears that if me scaramucci has much stronger control of language and of the ability to get a message across, and it remains to be seen how he is in the press it shop. Have been very as reports and outlets that scaramuccis a sentient into the white house was opposed by some in the white house, perhaps reince priebus, the chief of staff. What about this appointment is so controversial internally . To mr. When we listen scaramucci at the press conference, he basically said he is working directly for the president , in terms of having a hierarchy. He is putting himself on the outside of the oval office. He is saying he is not working for any of those politicians who have struggled for power over the last few months in the Trump Administration. That is one of the reasons we are hearing sean spicer chose to resign because he would not have that top position within the communications operation. Instead it would be Anthony Scaramucci reporting directly to the president. I think the fact that theyre up in so many power struggles within this white house, ringing i and a new face, someone closer to the president who has the ear of the president and the support of the president is a controversial move and will shake up the balance of power within the white house. That is what you have seen resistance from other top officials as this power dynamic shifted. Julia scaramucci did make the point several times in the press briefing he is not taking over yet. He will spend a few weeks getting used to everybody and getting up to speed with all of the issues. He was asked about health care, taxes. Just on that, what he is to say about the Health Care Debate and the possibility of a vote next week i think theramucci president will get a win and Health Care Just because ive seen him in operation the last 20plus years. The world turns back to him. He is generally a wonderful human being. I think as members of congress it to know him better and get comfortable with him, he will leave them to the right things for the american people. I think i will get health care done. Julia perhaps this is more about his relationship with donald trump than the prospects for health care next week. Talk about that. We have the potential for a vote or debate on health care next week. We have the deadline today, of course, for a decision from and paulump jr. Manafort whether they will accepted the request to testify next week, never mind of your policy. What will next week look like . Toluse there is a ton going on in washington that scaramucci basically try to avoid getting into the specifics during his press conference. On health care, it is not clear whether the senate will push through, get enough votes to support a bill next week. There is a bill that is supposed to go forward on tuesday. Its not clear what the senators will be voting on. That is something that is still up in the air. We could see something next week, the president s son, donald trump jr. Testifying before the senate. That caused a lot of consternation within the white house, the fact that the son of the president has been swept up in the sprawling investigations about russia. That is something that very well could bleed over into next week. That could become a dominant news cycle position. We will have to see whether that happens, whether or not donald testifies or whether it has to be compelled by subpoena. That is also on the table. Our White House Reporter in washington. Market equities have had a tremendous twice 17. We will be to Jeff Macintyre from Brandywine Global investors on what is driving this push. From new york, this is number this is bloomberg. Julia whatd you miss . It has been a great year for em equities. The benchmark index has been up 20 this year. Field . Re risks in the for what is driving the allocation to em and the bond disconnect, and which countries are most attractive to investors we have the Portfolio Manager for Brandywine GlobalInvestors Management great to have you on the show. Great to be here. Julia before we answered todays question is, lets take a step back. This is a sweet spot for markets, but youre suggesting your allocation from credit to emerging markets, i guess, on valuation . We are. When you talk about the sweet spot, for the first time in a long time, we have what i call sort of cord needed Global Growth. When you look at different regions you have growth, north america, asia, em. Its not super strong growth. Developed centralbank that is what i mean by the sweet spot. We were talking about Central Banks. They were starting to get worried about the valuation. Storyline is not as concerning to you . It is more risk. Feel better listening to yellens congressional testimony the other day that they get this. They will get back on that sort of asset inflation. Its going to reinforce disinflationary pressures and this is the idea you want to get away from that. If you look at the currencies in emerging markets, too, track it over a fiveyear things will look undervalued. Chest but to me, that is a key part of this. Youve got to look back. To me, that is a key part of this. Youve got to look back. If you look at 2010, yes, the s p 500 at a huge rally. If you get out, you would have missed the multiyear rally. This is not a oneyour development. This is a multiyear process. You brought is this really interesting chart that compares emerging markets currencies that is the teal line heard that fell a lot through 2016. Improved, but not huge. There has been significant tightening in the swaps. Much less concern about credit risk than there was a few years ago. As you point out, there is a disconnect where currencies do not seem to reflect the improving reception countrys of the value. Yes, and that is important. The countries relative to be bond, to the cds, offer compelling value. Joe is the best way to play it in rock currency or foreigncurrency debt . What is the best way to play at . The best way to the best way to play it is in a diversified approach in local currency bonds. Em currencies to rally. Just as a quick note, there are positive things happening in em, but negative things happening with the u. S. Dollar. Julia yeah, im going to come back to that. Joe, youre getting excited. Why the disconnect. Perception, why are they not looking at that . To me, in some ways, it is driven by market sentiment. We know that there are structural problems. But over time, this is going to converge. They will drive this off the sidelines. There are equity markets. Look at this chart. This is the turkish market as well. The caseerformance in of the blue line. Yet these guys have inverted yield curves. What is that telling you . I am a big bond investor. We like to see that. This is coming from stagflation. Low growth and inflation, the small the smart Central Banks would break the inflation premium. What volker did in the late 1970s and late 1980s. Then you can focus on positive growth. Julia so that is yielding. And the longer curve driven by inflation should continue to do what it ought to do. The short rates should come down. Do you like specifically in the em world . We like mexico. Bigger one of our politicians because of the trump effect. Its still very positive. They are still looking at cutting rates in the nottoodistant future. Has a ways to go. In brazil, there is political risk. When you look away from the the deficitssk, are shrinking. We need to have a conversation about shining. Julia do it. Wed have a conversation about china. Julia do it. In our view of commodities julia very quickly, i want to tie this back to the dollar. And i loosely what the central bank is doing, the ecb seems to be more of a driver than global bond deals. Ast factor in those surely weaker dollar here is more important, too . You go back to 2015, 2016, it put pressure on em. Debt in u. S. Ues dollars. The strong dollar puts pressure on commodity prices. We have seen a reversal of that. I think the more constructive view is constructive growth away from the u. S. And thats , thats net positive, capital leaving the u. S. In search of yield. But i think the administration does not want a strong dollar. He has brought the dollar down. Julia that is excuse for the dysfunction that we see. [laughter] u. S. Moving on thank you very much for joining us. My pleasure. Julia now is time for the bloombergs newsflash. Scripps network is said to be in acquisition talks. Discovery and file, are looking to buy the company. The deal could be announced as soon as this month. Jetblue is looking for partners to help at new yorks Jfk International airport. Says the location has the potential to have great value and they are targeted for opening in the mid2020s. The Parent Company lvmh is trying to capitalize on the china rebounds in following from the corruption crackdown. It has also been revamping its digital strategy. That is your Bloomberg Business flash. Take a deepup, we dive into the bloomberg. If you have a bloomberg terminal, youve got to watch tv. This is from earlier. You can see the breaking News Headlines on the right. Its interactive. You get the news and the individuals at the same time. Charts, emails, you can message us directly. Just go to tv on your terminal. From new york this is bloomberg. Julia im julia chatterley. Whatd you miss . Amill tell you what, i practicing on the conversation we just had on emerging markets currencies. Why . You can question whether the rally we have seen will continue, but what i am showing you hear in the white line is premiumear real yield between the emerging markets and g10. As you can see what i am showing you, the white line increasing. That is the premium for emerging markets continues to increase and we have seen the highest level for emerging markets currencies since 2015 look at the blue line. You can see for all of the pickup we have apparently seen since that low, as you can see there, in the blue from 2016, oh, boy, based on the real yield differential, they could have a lot further to go. Combine them with the cvs spreads indicating narrowing volatility for these countries julia someone is lagging. Joe you can look for an opportunity there. And i saw some today about how stocks are doing so much better than gold these days. Heres a really big picture of the s p 500 versus gold. Its basically a measure of how many ounces of gold you need to buy the s p 500. Back back during the bubble it was five ounces. Crisis level post for stocks. When people like stocks, that means that they like human ingenuity. When people like gold, they are bearish on rocks. Julia humans are cheap. Joe humans are cheap. Julia we are headed toward the market close. This is bloomberg. U. S. Stocks sinking today, all movements being lowered, Energy Shares leading declines in the s p. I am jewish heavily. Joe i am joe weisenthal. Scarlet fu is off. We want to welcome you to the closing bell coverage every day from 4 00 to 5 00 p. M. Eastern. Julia we begin with market minutes. Getting into negative territory. A lot of individual movement, i want to start with the energy 0. 9 , which is lower by and obviously we had oil under some pressure today. We have that meeting over the weekend of the opec members. They said the opec supply will be the highest this year for the month of july, so raising concerns. The global glut persisting longer than anticipated. You have drilling names seeing a significant net pressure. 5 lower in trading today. Look look at the Financial Sector as well, and is a real positive move. Red,verall sector in the the story of earnings overall, capital one beating expectations. The company squeezing through the stress test and conditional approval for the shareholders. Backinly investors off the , they like that. Financialve synchrony and E Trade Financial also gaining in the session. Some stocks that we want to pick up as well in terms of what we are seeing with reaction, General Electric clearly disappointing. This is the last quarter before they bow out the new president the old president. Ultimately weighing on the performance. What can the next ceo due to address . We have lots of investors on the sideline, the stock down 3 today. Microsoft announcing movement. 0. 6 . Ere down 6. 7 there some questions about the expense line. A look at thee u. S. Government bond market to end the week with the 10 year yield, yields down a little bit across the board, 2. 24 on the u. S. Tenure. 10 year. Lets look at this chart to get perspective. We are close to 2. 4, now in the middle. We have the fed meeting next week, no one expecting a height. The odds are below 50 in market pricing, so we have seen the decline in yield. We will see what next week brings us. Julia we have been talking about dollar weakness with the fed, and the weakness we saw in the trading session filtering into today as well. Somewhere in the currency, headlines coming out. The dollar weakness story, positive euro story continues. That began again after mario draghi did not talk about currency strength. They were making the argument this was about positioning and some shorts being pulled back rather than adding. The jury is out for that one also seeing sterling higher. If you want to point out emerging markets, we have seen broader weakness across emerging markets which fits with the broader risk appetite. And some of the opponents, the out performers from earlier on thehe week, this one is worst performing. The polish lawmakers have concerns out of brussels out of the political theater and the polish parliament set to defy International Allies and protests. That would affect more sway over the judiciary. They have gone from being the best emerging market currency to being the secondbest. Ch has thecrown cze crown. Joe lets take it the commodity market. Oil tumbling, concerns with rising opec supply down to. 6 , gold getting a little bit with the treasury bid, up 6. 6 . Toton is selling off, thanks some selling out of chinese reserves and iron or is down 2. 3, one of the commodities sensitive to china and other e