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Speaker 1: Good morning.

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Speaker 2: I'm John Tucker and I'm Karen Moscow. Here are the

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Speaker 2: stories we're following today, the.

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Speaker 1: Massive year and rally in bonds. In fact, the world's

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Speaker 1: debt market on track to post its biggest two month

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Speaker 1: gain on record. Bloomberg's Cretigoda has more other reasons behind

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Speaker 1: the move.

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Speaker 3: It's a complete when eighty in the markets. As investors

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Speaker 3: around the world become more and more confident that inflation

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Speaker 3: is actually in the rare view mirror, it's creating a

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Speaker 3: massive bet in the bond market that is really unseen historically.

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Speaker 3: The momentum that you're seeing in just the last two

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Speaker 3: months has really created this idea that maybe you might

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Speaker 3: see rates go even lower in twenty twenty four, not

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Speaker 3: just from the Federal Reserve, but from market participants as well. Swaps,

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Speaker 3: the measure through which traders make bets on the Federal

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Speaker 3: Reserve and other central banks around the world, well, they're

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Speaker 3: pricing about one hundred and fifty basis points of rate

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Speaker 3: cuts right here in the United States and the UK

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Speaker 3: next year. It's almost one hundred and seventy five basis

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Speaker 3: points in the Eurozone. As investor confidence bills, the central

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Speaker 3: banks have done their job, RIGHTO.

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Speaker 1: Brigs Quitty Goop, who says the Bloomberg Global Aggregate Total

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Speaker 1: return indexes risen nearly ten percent over November and December.

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Speaker 2: Well, we turned to equities now, John, and European stocks

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Speaker 2: are hovering near a two year high after the rally

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Speaker 2: seen across Wall Street in Asian markets, and we go

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Speaker 2: to London and get the latest with daybreak, europe banker

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Speaker 2: Stephen Carroll, Stephen.

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Speaker 4: Thanks, Karen and John. European markets started out the day

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Speaker 4: with gains, but that positive sentiment has petered out for now.

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Speaker 4: The stock six hundred has dipped into the red, along

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Speaker 4: with the benchmarks in London, Paris and Frankfurt. Energy among

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Speaker 4: the worst performing sectors, Oil majors falling as crude prices retreat. Now,

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Speaker 4: trading volumes across Europe are less than half their thirty

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Speaker 4: day average, but the European benchmark is up almost thirteen

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Speaker 4: percent this year, and it's still hovering at its highest

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Speaker 4: level since January twenty twenty two. In London, Stephen Carrol

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Speaker 4: Bloomberg Radio.

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Speaker 1: All right, thanks Steven. Oil retreating from a one month high.

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Speaker 1: Traders say key technical gauges their flashing weakness amid thin

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Speaker 1: holiday trading, supply risk posed by Yemen based hoothy rebels

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Speaker 1: haven't abated, even as incidents in the Red Seas start

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Speaker 1: to slow down. The shipping giant hapag Lloyd says it

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Speaker 1: will keep its vessels away from the Red Sea, despite

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Speaker 1: the launch of a US led task force to protect

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Speaker 1: the key trade route. Sylvia Westall is Bloomberg's managing editor

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Speaker 1: in the Middle East.

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Speaker 5: This idea of having a protection for shipping in this region,

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Speaker 5: it actually already exists, as actually already forces based there.

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Speaker 5: So I think some of the companies are a bit

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Speaker 5: confused as to what it will really entail.

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Speaker 1: Bloomberg's managing editor, Sylvia Westall says spot rates for a

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Speaker 1: container shipping have jumped twenty six percent over the past

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Speaker 1: four weeks. As we check Brent Crue, the international benchmark,

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Speaker 1: it is down thirty one cents at seventy nine thirty

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Speaker 1: four a barrel.

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Speaker 2: And John Bitcoin is about forty three thousand dollars. It's

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Speaker 2: been quite a run for the cryptocurrency we get more

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Speaker 2: with the Bloomberg's Eddie.

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Speaker 6: Vanderwald prices went up from about sixteen thousand in the

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Speaker 6: end of last year to more than forty three thousand

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Speaker 6: at the moment. That's a rally of one hundred sixty percent,

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Speaker 6: which you know, in bitcoin land is not uncommon. We

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Speaker 6: do see these big up moves, but usually that is

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Speaker 6: you know, associated with a lot of excitement and a

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Speaker 6: lot of media attention and so on.

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Speaker 7: We haven't seen that this year.

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Speaker 6: What we are seeing though, is as the expectation of

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Speaker 6: lower rates in the US and elsewhere probably comes to fruition.

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Speaker 6: Next year, money becomes cheaper and there's more speculative money around,

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Speaker 6: and some of that can flow into into assets like bitcoin.

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Speaker 2: And Bloombergy Eddy Vanderwald says optimism over our possible sec

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Speaker 2: approved bitcoin ETF is also helping fuel gains.

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Speaker 1: Meanwhile, Caaren Well Kathy Woods Exchange Traded Funds has executed

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Speaker 1: a massive shakeup in its bitcoin related holdings. More from

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Speaker 1: Bloomberg's Jeff Bellinger.

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Speaker 8: The Arc Next Generation Internet ETF sold all of its

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Speaker 8: remaining shares of the Grayscale Bitcoin Trust, according to data

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Speaker 8: compiled by Bloomberg, and on the same day, our investment

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Speaker 8: management data show that it bought more than four point

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Speaker 8: three million shares of pro Shares Bitcoin Strategy ETF, making

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Speaker 8: it the fund's second biggest holder. Wood has been trimming

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Speaker 8: her holdings in the Grayscale Bitcoin Trust in recent months,

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Speaker 8: even as bitcoin rose to its highest levels since April

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Speaker 8: of twenty twenty two. Jeff Bellinger Bloomberg Radio.

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Speaker 7: All right, Jeff, thanks well.

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Speaker 2: Apple putting its latest smart watch models back on sale

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Speaker 2: and its US retail stores a's after it went accord

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Speaker 2: ruling pausing a US sales ban on its newest models.

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Speaker 2: Mark German covers Apple for Bloomberg in California.

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Speaker 9: And sin So, what happens now the Apple stores in

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Speaker 9: the US did, about two hundred and seventy of them

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Speaker 9: began resuming sales of the Series nine and Ultra TiO

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Speaker 9: that are at the very center of this patent dispute

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Speaker 9: with Massoow Thursday about noon Pacific time, the Apple Watch

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Speaker 9: Ultra TiO in series line will return to the online stores.

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Speaker 9: You could buy the model that you'd like from their

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Speaker 9: online store and then staring on Saturday, all Apple stores

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Speaker 9: in the US nationwide will begin car the alteratt series

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Speaker 9: sign again.

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Speaker 2: And Bloomberg's Mark German says the ruling now buys the

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Speaker 2: company sometime and it's ongoing patent dispute with medical device

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Speaker 2: maker Massimo.

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Speaker 1: In geopolitical news, the Biden administration that is announced to

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Speaker 1: another aid package for Ukraine. Bloomberg's Baxter has the story.

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Speaker 10: It is two hundred and fifty million dollars in weapons

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Speaker 10: and equipment and the final package of the year. It's

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Speaker 10: drawn from Pentagon stocks, including ammunition for artillery and air

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Speaker 10: defense systems, as well as anti armor munitions and more

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Speaker 10: than fifteen million rounds of small arms ammunition. The DoD

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Speaker 10: as well says that Javelin anti tank systems and Stinger

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Speaker 10: Ata aircraft missiles will be offered. Secretary of State Anthony Blinken,

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Speaker 10: in a statement, said it is imperative the Congress act

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Speaker 10: swiftly to advance our the US national security interests by

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Speaker 10: helping Ukraine defend itself. Ed Baxter Bloomberg Radio.

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Speaker 2: All right, John, thanks time now for a look at

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Speaker 2: some of the other stories making new around the world.

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Speaker 2: And from that we're joined by Bloomberg's Amy Morris Samy.

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Speaker 2: Good morning, Good morning, Karen.

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Speaker 11: A coalition of mayors is asking the federal government to

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Speaker 11: provide more support to manage the influx of migrants arriving

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Speaker 11: by bus or plane from Texas. Mayors from New York City, Denver,

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Speaker 11: and Chicago all say they need help as Texas Governor

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Speaker 11: Greg Abbott sends more migrants to Democratic led cities.

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Speaker 7: Chicago Mayor Brandon Johnson all of.

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Speaker 12: Our cities have reached a point where we are either

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Speaker 12: close to capacity or nearly out of room. Without significant

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Speaker 12: intervention from the federal government, this mission will not be sustained.

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Speaker 11: In addition, New York City Mayor Eric Adams has issued

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Speaker 11: an executive order which requires thirty two hours notice from

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Speaker 11: charter bus companies transporting migrants to the city. President Biden

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Speaker 11: is justifying US attacks on targets in Iraq.

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Speaker 7: Bloomberg's Nancy Lyons reports.

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Speaker 13: In a letter to congressional leaders, President Biden says that

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Speaker 13: Christmas Day attacks on three installations linked to an Iran

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Speaker 13: backed insurgent group were necessary to prevent further attacks on

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Speaker 13: US military personnel. Biden writes that the strikes were intended

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Speaker 13: to quote degrade, and disrupt attacks on the US and

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Speaker 13: its partners, and to deter Tehran's proxy forces from conducting

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Speaker 13: further attacks. The US and its allies are trying to

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Speaker 13: keep the Israel Hamas conflict from escalating into a broader war.

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Speaker 13: In Washington, Nancy lyons Bloomberg Radio.

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Speaker 11: Residential candidate Nikki Haley is refusing to say that slavery

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Speaker 11: led to the Civil War. During a New Hampshire town

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Speaker 11: hall yesterday, a voter asked Haley what was the cause

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Speaker 11: of the Civil War, and the former South Carolina governor

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Speaker 11: and ambassador to the UN gave a lengthy response about

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Speaker 11: the role of government and the rights of the people,

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Speaker 11: but she never mentioned slavery.

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Speaker 7: What do you want me to say about slavery?

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Speaker 2: I love, argued my question.

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Speaker 11: Next question, the voter who asked the questions that he

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Speaker 11: found it astonishing slavery wasn't even mentioned. US Representative Lauren

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Speaker 11: Bobert says she's changing districts in Colorado. It's the right

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Speaker 11: move for me personally, and it's the right decision for

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Speaker 11: those who support our conservative movements. Alberta Republican announced on

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Speaker 11: Facebook she'll move to the fourth congressional district, trying for

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Speaker 11: the seat vacated by Ken.

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Speaker 7: Buck, who won't be seeking reelection.

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Speaker 11: Global News twenty four hours a day and whenever you

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Speaker 11: want it with Bloomberg News.

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Speaker 7: Now, I'm Ami Morris. This is Bloomberg Karen right Amy,

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Speaker 7: thank you.

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Speaker 2: What we do bring you news throughout the day right

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Speaker 2: here on Bloomberg Radio. But now, as Amy said, you

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Speaker 2: can get the latest news on demand, and that means

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Speaker 2: whenever you want it. Just subscribe to Bloomberg News Now

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Speaker 2: to get the latest headlines at a click of a button.

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Speaker 7: Get informed on your schedule.

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Speaker 2: You can listen and subscribe to Bloomberg News Now on

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Speaker 2: the Bloomberg Business app, Bloomberg dot com plus apples, Spotify,

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Speaker 2: and anywhere else you get your podcasts. Time now for

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Speaker 2: the Bloomberg Sports Update. Here's Dan Schwartzman. Dan, Good morning,

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Speaker 2: Karen Stunner in Denver.

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Speaker 14: As the Broncos have decided that nine time Pro Bowl

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Speaker 14: quarterback Russell Wilson will be benched starting a Sunday's game

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Speaker 14: against the LA Chargers, Jared Stidham will get the start.

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Speaker 1: Head coach Sean.

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Speaker 14: Payton says it's all about getting a spark on offense.

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Speaker 12: Rather than get into the specifics, because I think that

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Speaker 12: would be unfair today.

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Speaker 8: It's more about what we're We weren't doing effectively enough offensively,

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Speaker 8: and you know, when we were getting two or three turnovers.

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Speaker 15: It's one thing, but.

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Speaker 2: You know.

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Speaker 12: Ultimately our job is to get the ball in the

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Speaker 12: end zone, and we've got to be more efficient doing that,

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Speaker 12: all of us.

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Speaker 14: That's Curtisyebroncos dot Com. Wilson starts the first year of

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Speaker 14: a five year, two hundred and forty two point six

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Speaker 14: million dollar extension next year at thirty nine million bit

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Speaker 14: guaranteed for twenty twenty four. If Wilson can't pass a

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Speaker 14: physical in early March, thirty seven.

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Speaker 7: Million more will be guaranteed.

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Speaker 14: Week seventeen of the NFL season gets under way, the

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Speaker 14: Jets on the road in Cleveland facing the Browns. Cleveland

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Speaker 14: is ten and five, Jets come in at six and nine.

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Speaker 14: Trevor Simeon gets a star for New York Joe Flaco.

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Speaker 14: He is a quarterback for the Browns. The finalist for

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Speaker 14: the Pro Football Hall of Fame class at twenty twenty

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Speaker 14: four half in announced. First time candidates include Julius Peppers

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Speaker 14: and Antonio Gates. In the NBA, the Philadelphia seventy six

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Speaker 14: ers remain hot. They knock off the Magic in Orlando

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Speaker 14: one twelve to ninety two. Meanwhile, Milwaukee a big one

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Speaker 14: forty four to one twenty two win over the Brooklyn

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Speaker 14: Netsianna Santa Tocompo thirty two points, ten rebounds and eight assists.

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Speaker 14: That's your Bloomberg Sports Update.

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Speaker 8: I'm Dan Schwartzman.

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Speaker 15: From coast to coast, from New York to San Francisco,

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Speaker 15: Boston to Washington, DC, nationwide on Syrias, exam, the Bloomberg

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Speaker 15: Business app and Bloomberg dot Com. This is Bloomberg day Break, and.

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Speaker 1: I'm John Tucker. Good morning. The world's bomb market on

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Speaker 1: track to post its biggest two month game on record. Meantime,

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Speaker 1: SMP five hundred flirting with a record. Let's get you

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Speaker 1: set up for the trading day ahead. We're joined now

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Speaker 1: by Tim Craighead Bloomberg Intelligence Senior equities strategists. Hey, equities guy,

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Speaker 1: Let's start off with Yeah, the debt market. Investors seem

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Speaker 1: convinced central banks have won their battle against inflation. What

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Speaker 1: could possibly go wrong?

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Speaker 16: Tim, Well, I'll tell you it's very apropos to start

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Speaker 16: off with a bond market if you're talking talking about stocks,

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Speaker 16: because that's what striving stocks right now. There is no

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Speaker 16: doubt about it. To the degree that we've seen, whether

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Speaker 16: it's US, whether it's Europe, around the globe, a big

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Speaker 16: rally since late October he had equities. It's all about

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Speaker 16: bond markets. And if you look at expectations of central

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Speaker 16: bank policy and use the FED as the bell weather,

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Speaker 16: we've gone from expecting no rate cuts over the course

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Speaker 16: of the next six to twelve months to where now

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Speaker 16: you're looking at fifty basis points in six months and

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Speaker 16: one hundred basis points in a year. And this is

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Speaker 16: the issue. John. If this doesn't play through, if we

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Speaker 16: have a change in reference for some inflation spike or

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Speaker 16: something along those lines over the course in the next

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Speaker 16: month or two, then this run we've had into year

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Speaker 16: end across all asset classes is due for one of

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Speaker 16: these abrupt, volatile changes like we saw a couple of

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Speaker 16: times in twenty twenty three. That's the risk.

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Speaker 1: Hey, looking back on history, how unusual is it to

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Speaker 1: see bonds and equities rally at the same time and

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Speaker 1: what does that indicate.

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Speaker 16: It is interesting in that if you look whether it's

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Speaker 16: in the post pandemic period where you can really dig

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Speaker 16: into this microscopically over or longer term, quite often you

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Speaker 16: do see one versus the other. And it's the same

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Speaker 16: in the equities market, where you see either earnings driving equities,

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Speaker 16: or you see valuation driving equities, and you know the

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Speaker 16: corollary there is valuations quite often in stocks are driven

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Speaker 16: by what's transpiring and interest rates. And you know the

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Speaker 16: point that you're making here, it is unusual. We've seen

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Speaker 16: stocks and bonds rip over the course of the past

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Speaker 16: two months, and granted we're from a depressed level where

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Speaker 16: you remember back into the depths of the cell off

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Speaker 16: in October, it was all about uh longer for a

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Speaker 16: higher for longer from a from a policy rate standpoint,

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Speaker 16: and then all of a sudden we started seeing better

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Speaker 16: inflation prints and that whole psychology changed, which allowed the

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Speaker 16: run up in bonds, which allowed the run up and valuation.

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Speaker 16: You look at the pe on either US or European

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Speaker 16: markets and they've they've ramped up a couple of points.

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Speaker 16: That's a big move, and it's all because of the

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Speaker 16: change in bonds. So I think you can find narrow

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Speaker 16: points of time like this where you see a big

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Speaker 16: swing and interest rates that does have an immediate impact

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Speaker 16: in the equities market. And it's all about the valuation connection.

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Speaker 1: All right, specific to equities, what right now is the

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Speaker 1: bar for earnings moving forward? It's a pretty low barrow,

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Speaker 1: I would imagine in the US.

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Speaker 16: Yeah, and I think you're right, and it is a

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Speaker 16: difference between the US and the European markets. From a

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Speaker 16: US perspective, we had an earnings recession through late twenty

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Speaker 16: two into first half of twenty three, and we've started

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Speaker 16: to see positive revisions coming over the last six months

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Speaker 16: as we went through the mid year earning season into

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Speaker 16: the third quarter reporting season, and estimates are still ticking

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Speaker 16: up in the US. If you look over here where

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Speaker 16: I'm at in London and Europe, we actually had much

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Speaker 16: better earnings performance over the course of twenty two into

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Speaker 16: the first half of twenty three. You'd be surprised. If

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Speaker 16: you look to the chart on forward earnings expectations for

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Speaker 16: Europe versus the US. Europe far outperformed over the course

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Speaker 16: of the last eighteen months, but the last three months

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Speaker 16: it started to change. We've had negative estimate revisions here

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Speaker 16: in Europe and that's likely to continue into the next year.

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Speaker 16: We think that's a big risk factor for the first

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Speaker 16: half of the year where we are seeing a tick

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Speaker 16: up in the US, and a lot of that's because

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Speaker 16: of the TMT space, which was really the cause of

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Speaker 16: the earnings, recession in the US starting to actually come alive,

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Speaker 16: and we don't have that crutch. Here.

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