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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: They say if the Bloomberg daybreakurate podcast available every morning

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Speaker 2: on Apple, Spotify or wherever you listen. It's Tuesday, the

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Speaker 2: twenty seventh of August in London. I'm Stephen Carroll coming

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Speaker 2: up today. The CEO of mining giant BHP tells us

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Speaker 2: China's recovery is being hurt by the country's ongoing property

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Speaker 2: market woes. A relative cam returns to the Middle East,

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Speaker 2: but fears of an escalation remain after the weekend's violence.

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Speaker 2: Plus preparing The Economic Foundation's UK banks brace for a

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Speaker 2: lending boost on hopes that Labor can deliver on its

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Speaker 2: housebuilding pledge. Let's start with the undup of our top stories.

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Speaker 2: The world's biggest mining company is sounded a warning on

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Speaker 2: the strength of the Chinese economy. PHP says the country's

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Speaker 2: deteriorating demand outlook means iron Ore's supply will outpace demand

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Speaker 2: into next year. CEO Mike Henry pointed to China's property

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Speaker 2: slump as one of the main factors hurting appetite for

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Speaker 2: the metal in China.

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Speaker 3: A bit of a mixed picture. We're seeing strong growth

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Speaker 3: in a number of segments that are are important for

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Speaker 3: commodity demand in China, and that includes automobiles, machinery, infrastructure, shipbuilding,

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Speaker 3: but the property sector itself, which makes up about twenty

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Speaker 3: percent of steel demand, that is weak. It's been weak

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Speaker 3: for some time. We've seen lower or fairly low levels

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Speaker 3: of both sales and news starts. But the Chinese government

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Speaker 3: is enacting policies that are intended to address that.

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Speaker 2: HP boss Mike Henry says he still expects China to

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Speaker 2: hit its five percent growth target this year. The mining

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Speaker 2: giant CEO spoke to Bloomberg as the company reported an

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Speaker 2: underlying attributable profit for the year of little over thirteen

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Speaker 2: point six billion dollars. That's up two percent from the

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Speaker 2: year earlier and just above analysts estimates. The billionaire founder

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Speaker 2: of messaging up Telegram is still being held in France

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Speaker 2: over allegations he failed to combat crime on the platform.

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Speaker 2: Pavel Durov was arrested on Saturday as part of an

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Speaker 2: investigation by the s iber Crime Unit of the Paris

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Speaker 2: Prosecutor's Office. Bloomberg's Caroline Hyde says the case includes allegations

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Speaker 2: of enabling the sale of child sexual abuse material. This

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Speaker 2: is much more about the protection of children.

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Speaker 4: Versus sexual abuse, a particular formation of France, the area

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Speaker 4: the agency that has decided that they want to be

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Speaker 4: holding him for at least until Wednesday, whether or not

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Speaker 4: they indeed bring charges, whether they let him go free,

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Speaker 4: or becomes a witness to an investigation that's more deeply

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Speaker 4: into the protection of children against sexual abuse.

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Speaker 2: Aspinberg Technologies Caroline Hyde there Durov has repeatedly ignored requests

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Speaker 2: from democratic and authoritarian governments to better moderate content on

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Speaker 2: his platform. In response to the arrest, Telegram said in

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Speaker 2: a statement, it's absurd to claim that a platform or

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Speaker 2: its owner are responsible for abuse of that platform. Apple's

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Speaker 2: longtime chief financial officer will step down at the end

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Speaker 2: of the year. Lucamesterri will hand his role to top

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Speaker 2: deputy Kevin Perek after more than a decade. The company

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Speaker 2: has described the move as a planned transition, with Mestri

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Speaker 2: remaining at the firm in a reduced role overseeing information

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Speaker 2: technology and real estate functions. It's Apple's second management switch

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Speaker 2: this month, after last week's announcement that vice president in

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Speaker 2: charge of the app store, Matt Fisher will also be replaced.

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Speaker 2: Talks over at Gaza Seasephire continued in Cairo on Monday,

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Speaker 2: as relative cam returned to the region following Israel's bombing

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Speaker 2: of Hisbella missile launchers in Lebanon over the weekend. Despite

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Speaker 2: the brief hiatus from the violence, Natasha Hole from the

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Speaker 2: Middle East Program at the Center for Strategic and International

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Speaker 2: Studies says it may not last.

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Speaker 5: There was a very very heightened escalation in the early

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Speaker 5: morning hours of Sunday, but it's unclear if this was

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Speaker 5: escalatory or not. But military analysts are saying that this

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Speaker 5: was essentially effective in terms of deterrence. That said, Iran

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Speaker 5: still has not conducted its retaliatory strike for that assassination

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Speaker 5: the way that they had promised to, so it's unclear

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Speaker 5: if this is peace for the long run or if

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Speaker 5: this is just a momentary pause.

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Speaker 2: Natasha Hole from the Center for Strategic and International Studies

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Speaker 2: speaking there, the US's negotiations over a truce and Gaza

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Speaker 2: continued at a working group level on Monday after the

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Speaker 2: Hamas delegation on Sunday accusday Israel of procrastinating and setting

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Speaker 2: new conditions for a ceasefire. Prices in British shops are

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Speaker 2: falling for the first time in three years. Retailers reduced

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Speaker 2: their prices by zero point three percent in early August,

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Speaker 2: according to data from the British Retail Consortium. Shops are

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Speaker 2: trying to lure cautious consumers back after a cost of

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Speaker 2: living crisis. The figures come after Bank of England Governor

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Speaker 2: Andrew Bailey said at Jackson Hole last week it was

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Speaker 2: too early to declare victory over inflation and Britain's banks

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Speaker 2: are readying themselves for a lending surge on the back

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Speaker 2: of the Labor The new Labor Government's pledged to build

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Speaker 2: one and a half million homes over the next five years.

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Speaker 2: Bloomberg's Chrispit has the story.

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Speaker 6: Three big lenders have told Bloomberg they are betting on

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Speaker 6: a rise in UK housebuilding. Investec, Oak North and Shawbrook

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Speaker 6: also the government's new policies will drive steady positive improvements

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Speaker 6: in the market, they say. Lenders, banks and debt funds

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Speaker 6: are all moving into funding new developments. It comes after

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Speaker 6: Deputy Prime Minister Angela Rayner last month promised to make

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Speaker 6: it easier for developers to build on the green belt

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Speaker 6: and restore mandatory local housebuilding targets ditched by the previous

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Speaker 6: government in London. Chris Pitt Bloomberg Radio.

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Speaker 2: Now in a moment, we'll dig into those results from

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Speaker 2: BHP and bring you up to date on the developments

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Speaker 2: in the Middle East. But another story that caught my

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Speaker 2: eye this morning, the latest BusinessWeek daily newsletter, is asking

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Speaker 2: questions about the TV series industry and how true to

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Speaker 2: life its depiction of the finance industry is. If you

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Speaker 2: haven't seen it, it's based in the London office of

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Speaker 2: a fictional US investment bank and depicts harassment, abuse of staff,

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Speaker 2: drug use, disregard for securities, last securities law or clearly

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Speaker 2: things appt up for dramatic effect. But our senior investing

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Speaker 2: reporter Catherine Burton asked some on Wall Street how real

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Speaker 2: it feels, and apparently there is some truth to it.

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Speaker 2: One former partner, Goldman Sachs, told her, first of all,

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Speaker 2: that he loves the show, and secondly that the human

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Speaker 2: drama depicted is realistic. The gen Z junior bankers who

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Speaker 2: are unhappy about paying their dues and trying to get ahead,

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Speaker 2: and their managers who know they're only as good as

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Speaker 2: their next trade, and they're terrified that their ambitious underlings

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Speaker 2: will overthrow them. Another finance veteran told that Catherine Burton

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Speaker 2: that he stopped watching it because everyone on the show

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Speaker 2: is so unpleasant, untrustworthy and unlikable. In other words, he says,

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Speaker 2: the writers have captured the industry far too well. Well,

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Speaker 2: that's bringing more details now on those results from the

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Speaker 2: world's biggest mining company BHP, and in particular the warning

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Speaker 2: over the outlook for the Chinese economy. Our metals and

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Speaker 2: mining reporter Martin Richie joins us now from Shanghai for more. Martin, welcome.

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Speaker 2: What does the commentary from BHP tell us about the

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Speaker 2: Chinese economy?

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Speaker 7: Yeah, a lot more cautious commentary than I think we're

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Speaker 7: probably used to from BHP, adding to a kind of

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Speaker 7: flow of comment and analysis recently about weakness I think,

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Speaker 7: particularly in those metals that are very exposed to China's

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Speaker 7: property sector. That was really the key message. It was

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Speaker 7: about slow down in property. I was drawn to one

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Speaker 7: of the numbers he used, saying that housing construction was

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Speaker 7: now only twenty percent of steel demand. That's down from

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Speaker 7: upwards of forty forty five percent in previous boon times.

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Speaker 7: There are other sectors that are coming forward to take

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Speaker 7: up some of the slack in manufacturing and other areas,

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Speaker 7: but with housing on a down trend, that's a negative

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Speaker 7: for BHP, which gets so much of its earnings from

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Speaker 7: iron ore. On the positive side, though, I think copper

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Speaker 7: obviously the flagged sort of soft demand on copper at

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Speaker 7: the moment, but still pushing this idea of booming copper

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Speaker 7: demand in years to come from renewable energy and all sorts.

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Speaker 7: And I think the broader message was about sort of

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Speaker 7: pivoting BHP from its reliance on iron ore, not total reliance,

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Speaker 7: but iron was very dominant in it's in its portfolio

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Speaker 7: for many years towards more on copper. So we'll have

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Speaker 7: to see what more they do on that front.

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Speaker 2: Yeah, it's interesting to try and see what window this

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Speaker 2: gives us into those key industries in China. I mean,

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Speaker 2: how bad is the crisis in Chinese stale?

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Speaker 7: Well, if you listen to some of the messages that

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Speaker 7: will come out recently, it's it's very bad. You know,

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Speaker 7: you've get this combination of a very long protracted slowdown

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Speaker 7: in the property sector. But the difference between previous downturns

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Speaker 7: in that area is really no really, no real prospect

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Speaker 7: of major of a major turn around. You know, this

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Speaker 7: is a this is a kind of new economy that

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Speaker 7: we're going towards. Now, that doesn't mean that steel demand

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Speaker 7: is plunging. We're probably you know, we're down maybe ten

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Speaker 7: percent from a few years ago, and there are a

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Speaker 7: lot of areas that will still produce more that will

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Speaker 7: still need more steel. But with that, that gap is

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Speaker 7: hard to fill for commodities companies, especially ones that are

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Speaker 7: reliant on on China. Having said that, you know, the biggest,

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Speaker 7: the biggest, the companies that hurt most when iron or

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Speaker 7: prices fall are not BHP, which are very low cost producers.

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Speaker 7: They're the higher cost ones which will go out of

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Speaker 7: business to nouris and as iron or is down below

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Speaker 7: one hundred, below ninety, below eighty, so they have that cushion.

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Speaker 7: And that's also something that Mike Henry obviously alluded to.

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Speaker 2: Yeah, indeed, I mean this is it's interesting to think

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Speaker 2: about BESP as well because of a story that we

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Speaker 2: talked about with them earlier in the year too, which

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Speaker 2: was their attempt to take over rival Anglo American BHP

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Speaker 2: can try again on that deal in November, did we

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Speaker 2: hear anything from Mike Henry on that front.

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Speaker 7: I think he was asked about it in the Bloomberg

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Speaker 7: TV interview and I can just read you his answer

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Speaker 7: of Robata Mtuly, that's probably easiest way of doing it.

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Speaker 7: The plan a for BHP was never about acquisitions, and

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Speaker 7: it wasn't about that specific opportunity. It was about everything

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Speaker 7: that you see in this adult focusing first and foremost

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Speaker 7: and ensuring that we're getting the most out of our capitol.

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Speaker 7: So that doesn't really answer the question directly but another bid,

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Speaker 7: but it you know, it does show that it's possibly

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Speaker 7: a focus on organic growth, looking at what they can

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Speaker 7: get out of existing copper assets, how they can build

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Speaker 7: their portfolio that way if there isn't, you know, a

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Speaker 7: big acquisition.

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Speaker 2: Okay, Martin Ritchie, thanks very much for joining us our

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Speaker 2: Metals and Mining Reporter. They're bringing us up to date

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Speaker 2: on the earnings from BHP and what it tells us

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Speaker 2: about the outlook for the Chinese economy as well, given

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Speaker 2: their commentary around that country and particularly its demand for

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Speaker 2: those key metals arn Ora and copper. Martin. For now,

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Speaker 2: thank you to the Middle East. Now a relative cam

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Speaker 2: has been restored after Israeli bombing of Hesbela targets and

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Speaker 2: Lebanon on Sunday and the hundreds of projectiles fired in

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Speaker 2: response by the Iran backed militant group into Israel. This

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Speaker 2: while talks over at Gaza ceasefire have continued in Cairo.

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Speaker 2: Let's get the latest this morning from our reporter Galat

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Speaker 2: Alstein in Tel Aviv. Good morning to you, Gal, It's

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Speaker 2: great to have you with us. Have fears of further

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Speaker 2: attacks eased for now?

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Speaker 8: Yes, good morning, So I would say that the answer

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Speaker 8: to that question, in one word, would be yes on

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Speaker 8: the larger attack that was anticipated for weeks after Israel

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Speaker 8: took down on Lebanon based Chrisbella's military chief in their route,

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Speaker 8: Chris Bala, We're backed by Iran. Theved revenge that will

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Speaker 8: exceed the daily tit for test fire exchanges that have

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Speaker 8: been going on them in the Israeli Army for months.

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Speaker 8: Those are thought to be contained geographically and otherwise, so

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Speaker 8: that valve for revenge is thought considered to be mainly

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Speaker 8: over after the Sunday events that you just mentioned, And

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Speaker 8: at the same time, there is another threat of retaliation

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Speaker 8: against Israel directly from Iran, who seeks revenge for the

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Speaker 8: killing of a senior Hamas leader in Tehran recently that

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Speaker 8: is in a way been put on a back burner

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Speaker 8: after Iran signal that it won't be imminent. And at

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Speaker 8: the same time, the Youth Chairman of the Joint Chiefs

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Speaker 8: of Staff, General General Charles Brown, did visit Israeli yesterday

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Speaker 8: to discuss, as described in the statement, security and strategic

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Speaker 8: issues and the expansion of operational tools and regional partnerships.

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Speaker 8: As the US does maintain strong military presence in the region.

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Speaker 8: So to sum it up, there is nothing imminent that

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Speaker 8: we're aware of, and yet the Iranian retaliation threat is

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Speaker 8: in the air, as well as of course the ongoing

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Speaker 8: risk of miscalculation in the daily fire exchanges between Israel

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Speaker 8: and Grizabella that can spontaneously cause a flare up.

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Speaker 5: Yeah.

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Speaker 2: Indeed, because of course the situation does remain tense on

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Speaker 2: that border between Israel and Lebanon as well. An evacuation

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Speaker 2: order is still in place there for many residents.

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Speaker 8: Yes, that's correct. So, as you mentioned on Sunday, there

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Speaker 8: was a large Israeli preemptive attack that struck thousands of

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Speaker 8: Laune barrels and rockets in South Lebanon, and then Isbell

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Speaker 8: are retaliated by firing over two hundred rockets, missiles and

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Speaker 8: drones at Israel, and both sides have conveyed messages that

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Speaker 8: that specific large round is over for now. And that's

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Speaker 8: not to say that there is quiet across that front.

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Speaker 8: Yesterday was just another day of tit for tat, with

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Speaker 8: explosive drones launched at Israel last night and the Israeli

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Speaker 8: army attacking his Bala targets and militimes in Lebanon. And

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Speaker 8: as you mentioned, the evacuation of some sixty thousand residents

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Speaker 8: across Israel's north and that's just the official number. There

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Speaker 8: are probably more people who evacuated from there, So that

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Speaker 8: was extended the evacuation order through the end of September,

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Speaker 8: but has already been budgeted through the end of the

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Speaker 8: year through the end of December. So it's still very

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Speaker 8: much a war zone that's mostly contained to Israel's northern region.

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Speaker 8: It's skills into communities that were not evacuated, and of

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Speaker 8: course to the southern regions of Lebanon that has also

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Speaker 8: seen tens of thousands of civilians displaced for many months.

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Speaker 2: Gettis of course, all of this is connected to the

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Speaker 2: war that's continuing in Gaza. We did importantly and this

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Speaker 2: same as important signals. He talks take place on Sunday

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Speaker 2: after they at that exchange of fire, but continue at

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Speaker 2: a working group level on Monday yesterday as well. Are

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Speaker 2: there any signs of progress being made?

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Speaker 8: Right? So no, unfortunately there are no real signs of progress.

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Speaker 8: We haven't been hearing anything official. But the overall sensus

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Speaker 8: that the importance of these dogs at this moment is

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Speaker 8: that they carry on that is thought to in itself

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Speaker 8: be preventing regional escalation to some extent, and also, of

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Speaker 8: course it does maintain a chance that progress will be

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Speaker 8: made eventually. It is our understanding that course sticking points

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Speaker 8: like whether Israeli presence can be maintained across the Philadelphia Corridor,

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Speaker 8: which is along Gazza's border with Egypt, as well as

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Speaker 8: along another corridor called the Letsom Corridor, which separates Gazas

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Speaker 8: north and south. So these sticking points have been put

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Speaker 8: on hold in favor of issues that are considered perhaps

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Speaker 8: slightly easier to resolve or at least less explosive, like

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Speaker 8: the number and identity of Israeli high hostages that tro

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Speaker 8: will be released as part of a ceasefire, as well

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Speaker 8: as the identity number of Palestinian prisoners that will be

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Speaker 8: released in term from Israeli jails. So for now, these

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Speaker 8: are the issues that are trying to be resolved and

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Speaker 8: that are on the table. Talks do continue.

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