WEBVTT - Bloomberg Daybreak: February 4, 2022 - Hour 1 (Radio) 0:00:01.400 --> 0:00:04.600 Live from the Bloomberg Interactive Burger Studios. This is Bloomberg 0:00:04.680 --> 0:00:08.559 day Break for Friday, February four two. Coming up this hour, 0:00:08.960 --> 0:00:13.040 Tech shares rebound, is Amazon earnings boost sentiment, Facebook owner 0:00:13.200 --> 0:00:15.640 Meta comes off the worst one day crash and the 0:00:15.800 --> 0:00:18.040 history of the staff market. It's a big day for 0:00:18.239 --> 0:00:21.400 data as investors await the January jobs report and the 0:00:21.480 --> 0:00:25.280 crisis in golfing. UK Prime Minister Boris Johnson gets even worse. 0:00:25.560 --> 0:00:29.480 President Biden visits New York City on gun violence, plus playtiffs, 0:00:29.480 --> 0:00:32.199 have suit Governor Kathy Oakell over New York States Green 0:00:32.280 --> 0:00:35.760 District and plan I'm Michael barn Or a had John's 0:00:35.800 --> 0:00:38.400 dashower and sports St John's with a win at Georgetown 0:00:38.400 --> 0:00:40.880 and a strong denial for the Giants and the Brian 0:00:40.960 --> 0:00:46.760 Flores lawsuit. That's all straight ahead on Bloomberg day Break 0:00:46.960 --> 0:00:51.800 on Bloomberg Gilimen TREEO New York, Bloomberg one, Washington, d C, 0:00:52.200 --> 0:00:56.560 Bloomberg one O six one, Boston, Bloomberg nine sixty, San Francisco, 0:00:56.920 --> 0:01:00.200 Sirius x M one nineteen and around the world on 0:01:00.360 --> 0:01:07.479 Bloomberg Radio dot com and via the Bloomberg Business Act. Well, 0:01:07.560 --> 0:01:10.759 Good Friday, morning. I'm Nathan Hagar and I'm Karen Moscow 0:01:10.800 --> 0:01:13.640 and US Dock Index futures are climbing in the wake 0:01:13.680 --> 0:01:16.120 of Amazon earnings. Were coming up to final one on 0:01:16.240 --> 0:01:18.400 Wall Street, and we checked the markets every fifteen minutes 0:01:18.440 --> 0:01:21.640 throughout the trading day on Bloomberg Guess and the futures 0:01:21.680 --> 0:01:25.280 up twenty nine points down, futures up seventy three, NASDACK 0:01:25.360 --> 0:01:29.280 futures up one ninety two. The decks in Germany's down 0:01:29.280 --> 0:01:31.920 eight tenths of upper cent. The ten year treasury up 0:01:31.959 --> 0:01:34.480 three thirty seconds. He had one point eight two percent, 0:01:34.560 --> 0:01:36.640 and they yield on the two year one point to 0:01:36.840 --> 0:01:40.440 one percent. Comas gold is up half percent or eight 0:01:40.440 --> 0:01:44.200 dollars thirty cents at eighteen twelve forty. Unnounced the euro 0:01:44.319 --> 0:01:47.880 one point one four six six against the dollar. Nathan Well, Karen, 0:01:47.920 --> 0:01:50.800 what a difference of day makes right? Facebook sent the 0:01:50.920 --> 0:01:54.880 nastac plummeting yesterday, but this morning it is a reversal, 0:01:54.920 --> 0:01:58.400 with futures getting a huge boost thanks to Amazon's earnings 0:01:58.440 --> 0:02:01.080 after the bell. Shares of the e commerce giant are 0:02:01.160 --> 0:02:04.960 up nearly thirteen percent. The rally comes after Amazon posted 0:02:05.040 --> 0:02:08.880 blockbuster profit and raised prices for its US Prime membership. 0:02:09.320 --> 0:02:11.919 Ed Ludlow has the details from our Bloomberg nine sixty 0:02:11.960 --> 0:02:14.760 newsroom in San Francisco. The annual price of Prime will 0:02:14.840 --> 0:02:17.520 rise by twenty dollars to a hundred and thirty nine dollars, 0:02:17.520 --> 0:02:21.160 the first increase since two thousand eighteen. Executives touted the 0:02:21.200 --> 0:02:23.840 slate of life sports content to come a new series 0:02:23.880 --> 0:02:26.880 like Lord of the Rings. Beyond benefits like shipping discounts, 0:02:27.080 --> 0:02:29.720 Amazon was also able to negate higher input costs and 0:02:29.800 --> 0:02:32.880 labor challenges in the quarter, with monster profits. Some of 0:02:32.919 --> 0:02:36.040 that tight to gains on its investment in ev maker Ribbean, 0:02:36.440 --> 0:02:39.200 the cloud and advertising unit, which was broken out for 0:02:39.200 --> 0:02:42.400 the first time, also performed well in San Francisco. Ed 0:02:42.440 --> 0:02:45.239 Ludlow Bloomberg daybreak. All right, and thank you. But we're 0:02:45.240 --> 0:02:48.240 also seeing a major bounce back and two stocks that 0:02:48.320 --> 0:02:51.720 took up pounding yesterday. Snap, which lost almost a quarter 0:02:51.760 --> 0:02:54.519 of its value, is searching more than forty eight percent 0:02:54.639 --> 0:02:58.000 this morning. Pinterest is up sixteen percent in early trading. 0:02:58.120 --> 0:03:01.520 And again more from Bloombery stug create snaps fourth quarter 0:03:01.520 --> 0:03:05.760 of sales increased to one point three billion dollars daily 0:03:05.800 --> 0:03:10.519 active users of the company's Snapchat mobile app top forecast. Separately, 0:03:10.600 --> 0:03:14.280 the earnings from pinterest were above estimates, quarterly revenue jump 0:03:15.040 --> 0:03:18.240 compared to last year, and these games sparked a turnaround 0:03:18.240 --> 0:03:21.520 in social media stocks in the extended session, following a 0:03:21.639 --> 0:03:25.320 route triggered by the disappointing earnings from meta platforms. In 0:03:25.360 --> 0:03:28.240 New York, I'm Dick Prisoner, Bloomberg Daybreak, All right, Doug, thanks, 0:03:28.240 --> 0:03:30.600 speaking of that sell off tied to Meta turns out 0:03:30.639 --> 0:03:33.120 the one day crash now ranks as the worst in 0:03:33.240 --> 0:03:38.200 stock market history. Bloomberg's Charlie Pellett explains the Facebook parent 0:03:38.280 --> 0:03:42.720 plunged twenty six percent and erased about two hundred fifty 0:03:42.760 --> 0:03:46.240 two billion dollars in market value. That is the biggest 0:03:46.280 --> 0:03:50.000 wipe out in market value for any American company ever. 0:03:50.520 --> 0:03:55.720 Michael Nathanson with Moffett Nathanson titled his note Facebook the 0:03:55.760 --> 0:03:59.360 Beginning of the End in New York. Charlie Pellet Bloomberg Daybreak, 0:03:59.400 --> 0:04:01.360 All right, Charlie, thank you about the plunge and Meta 0:04:01.400 --> 0:04:05.320 shares has one potential silver lining for CEO Mark Zuckerberg. 0:04:05.320 --> 0:04:07.520 And let's get the lightish lie from Bloomberg's rend A 0:04:07.600 --> 0:04:10.240 young Good morning Nana, Good morning Karen. The big question 0:04:10.400 --> 0:04:13.760 is if Facebook users are flocking to TikTok, then should 0:04:13.760 --> 0:04:17.160 it be considered competition and if so, the more challenging 0:04:17.240 --> 0:04:21.400 landscape adds muscle to fight a pending government lawsuit against Meta. 0:04:21.680 --> 0:04:25.600 Since Meta's earnings miss yesterday, CEO Mark Zuckerberg has continued 0:04:25.640 --> 0:04:29.279 to cite competition from TikTok as a threat. That claim 0:04:29.320 --> 0:04:32.680 is at the heart of the FTC's antitrust lawsuit against Meta, 0:04:32.920 --> 0:04:37.080 which says it's a monopoly with no true competition. Meantime, 0:04:37.080 --> 0:04:40.200 Bloomberg sources say Zuckerberg is telling staff to focus on 0:04:40.240 --> 0:04:44.520 growing Facebook and Instagram's short video product Reels, which is 0:04:44.560 --> 0:04:47.920 a copycat of TikTok. Live in New York. I'm gonna 0:04:47.920 --> 0:04:49.920 need a young Bloomberg day break, all right, we need 0:04:49.920 --> 0:04:52.600 to thank you yesterday's Facebook led sell off saw the 0:04:52.680 --> 0:04:57.240 NASDAC plunge three and three quarters percent yesterday. The volatility 0:04:57.279 --> 0:04:59.880 is not a surprise for Morgan Stanley, Chief US equ 0:05:00.160 --> 0:05:03.000 strategist Mike Wilson. You know, we've had this narrative fire 0:05:03.080 --> 0:05:06.720 and ice, and we think it it's gonna be icier. Um, 0:05:06.800 --> 0:05:09.000 you know that doesn't mean recession as we negative payroll 0:05:09.080 --> 0:05:11.680 numbers for the next five months. But the idea that 0:05:11.720 --> 0:05:14.479 we're not gonna have some payback here from what was 0:05:14.520 --> 0:05:17.919 the spectacular, you know, kind of rebound during the pandemic, 0:05:18.360 --> 0:05:21.200 we think his naive. Morgan Stanley's Mike Wilson made the 0:05:21.240 --> 0:05:24.280 comments on Bloomberg Surveillance Catch the program on Bloomberg Radio 0:05:24.320 --> 0:05:27.560 and Television at seven am Wall Street Time. Well, yesterday 0:05:27.600 --> 0:05:30.120 it was all about corporate earnings, Nathan, and today we 0:05:30.200 --> 0:05:33.400 focus on jobs. The government's monthly payrolls report is at 0:05:33.440 --> 0:05:36.440 eight thirty am Wall Street Time. Consensus calls for a 0:05:36.480 --> 0:05:39.200 gain of one or twenty five thousand jobs in January, 0:05:39.440 --> 0:05:42.040 but plenty of predictions call for a much lower number. 0:05:42.120 --> 0:05:45.240 Bloomberg's Michael McKee explains this may be one of the 0:05:45.279 --> 0:05:49.760 most interesting and inconsequential jobs reports in many years. The 0:05:49.760 --> 0:05:52.480 omicron wave that's spread through the country in January likely 0:05:52.520 --> 0:05:56.760 caused many companies to pause hiring plans and many workers 0:05:56.800 --> 0:05:59.640 sick with COVID. Likely we're off payrolls during the month. 0:06:00.040 --> 0:06:03.040 Economists anticipate the weakest hiring in a year, and many 0:06:03.080 --> 0:06:05.960 think the economy may have lost jobs during the month. 0:06:06.360 --> 0:06:10.080 The unemployment and participation rates are forecast to be unchanged, 0:06:10.480 --> 0:06:13.120 but it's not likely to matter to markets or the Fed. 0:06:13.240 --> 0:06:15.799 The Central Bank has made its next policy moves clear, 0:06:16.279 --> 0:06:19.960 and investors will discount bad news as temporary. Looking for 0:06:20.000 --> 0:06:24.440 a payrolls rebound this month. Michael McKey, Bloomberg Daybreak. All right, Mike, thanks, 0:06:24.440 --> 0:06:27.360 We now turned the politics overseas, the crisis and golfing 0:06:27.440 --> 0:06:31.080 UK Prime Minister Boris Johnson's government has gotten worse. Let's 0:06:31.120 --> 0:06:33.200 go live to London and get the latest from Bloomberg's 0:06:33.200 --> 0:06:36.640 Max Ramsey. Good morning, Max, Morning to you, Nathan and Karen. 0:06:36.680 --> 0:06:40.320 Really a significant escalation of the challenges facing Boris Johnson 0:06:40.360 --> 0:06:43.560 with the resignation of four of his closest aids. We're 0:06:43.560 --> 0:06:45.880 talking about people in the Prime Minister's in a circle, 0:06:45.920 --> 0:06:49.320 including his chief of staff and communications directed. But most 0:06:49.400 --> 0:06:52.279 damaging has been the resignation of his policy chief. She 0:06:52.360 --> 0:06:54.440 really hit out of Boris Johnson because of her remark 0:06:54.480 --> 0:06:57.720 he made attacking the Labor Party leader Kere Starmer. This 0:06:57.839 --> 0:06:59.760 all comes in the wake of what's being called in 0:07:00.080 --> 0:07:03.839 to party get these lockdown breaking gatherings in Downing Street, 0:07:03.880 --> 0:07:06.960 and it's only been getting more serious full Boris Johnson 0:07:07.240 --> 0:07:09.920 Live in London, Max Ramsey boom back daybreak all right, Max, 0:07:09.960 --> 0:07:12.040 thank you, and in the oil past today geo political 0:07:12.080 --> 0:07:14.680 tensions and a fast tightening global market has crewed on 0:07:14.760 --> 0:07:18.320 track for a seventh weekly gain straight ahead your local headlines. 0:07:18.400 --> 0:07:24.160 This is Bloomberg all right here in thanks five oh 0:07:24.160 --> 0:07:26.680 seven on Wall Street. Rain fifty five degrees in central 0:07:26.680 --> 0:07:28.720 parks are gonna drop through the day, and already we 0:07:28.800 --> 0:07:31.120 got a bunch of accidents north Founder to eight seven 0:07:31.120 --> 0:07:33.680 between exits thirty six and thirty seven. Details coming up 0:07:33.680 --> 0:07:36.280 in traffic. First Michael Barr with what else is going 0:07:36.280 --> 0:07:38.360 on in New York and around the world. Good morning, Michael, 0:07:38.520 --> 0:07:41.080 Good morning Nathan. The Tri State area is in the 0:07:41.080 --> 0:07:44.920 path of a winter storm Bloomberg. Needirelogious. Rob Carolin has 0:07:45.000 --> 0:07:47.880 the latest. Michael. We have a pretty wild contrast across 0:07:47.920 --> 0:07:50.160 the Tri State area. In the Hudson River Valley, temperatures 0:07:50.160 --> 0:07:53.000 have already fallen to around thirty two up around Stewart 0:07:53.000 --> 0:07:55.240 Field in Poughkeepsie. That cold air is going to be 0:07:55.320 --> 0:07:57.560 pushing southward into the city and that will change our 0:07:57.600 --> 0:08:00.840 precipitation over to some freezing rain for a before it 0:08:00.880 --> 0:08:03.400 goes over to sleet later this morning. To be very 0:08:03.440 --> 0:08:06.200 careful as the morning goes on, because Rhodes will become icy, 0:08:06.520 --> 0:08:09.680 especially those elevated surfaces as that colder air pushes down 0:08:09.720 --> 0:08:12.160 from the north. Winner Weather Advisory and effect from eight 0:08:12.240 --> 0:08:15.560 this morning through seven pm this evening, Michael, Thanks Rob. 0:08:15.680 --> 0:08:18.880 New York Mayor Eric Adams talked about curbing the surge 0:08:18.880 --> 0:08:21.640 of gun violence in the city during President Joe Biden's 0:08:21.680 --> 0:08:25.680 visit yesterday. It's enough, enough is enough, because we know 0:08:25.840 --> 0:08:29.360 we can do things about this, but for the resistance 0:08:29.400 --> 0:08:33.240 we're getting from some sectors of the government and the 0:08:33.280 --> 0:08:38.800 Congress and the state legislatures and the organizational structures out there. 0:08:39.400 --> 0:08:42.679 Mayor Adams talked about his new police unit to combat 0:08:42.720 --> 0:08:46.560 gun violence that replaces the controversy of old anti crime unit. 0:08:46.960 --> 0:08:50.880 We're not bringing back the anti crime unit of This 0:08:50.960 --> 0:08:53.480 is not going to be a plain closed unit. This 0:08:53.640 --> 0:08:56.640 is an anti gun unit with the officers are going 0:08:56.720 --> 0:09:00.600 to have and modified police uniform and they're going to 0:09:00.720 --> 0:09:05.120 be an unmocked bigs. Mayor Adams spoke on ABC's Nightline. 0:09:05.400 --> 0:09:08.440 Fourteen plaintiffs are suing New York Governor Kathy Hockle and 0:09:08.520 --> 0:09:12.360 state Democratic lawmakers. The lawsuit in the New York Supreme 0:09:12.400 --> 0:09:17.280 Court claims that the state's new congressional and legislative maps 0:09:17.320 --> 0:09:21.840 are unconstitutional. HOCAL has signed off on new maps that 0:09:21.960 --> 0:09:26.360 give Democrats a heavy political advantage over Republicans. Republican officials 0:09:26.400 --> 0:09:29.080 meeting in Utah have advanced the resolution that would formerly 0:09:29.160 --> 0:09:33.400 send your representatives Liz Cheney and Adam Kinzinger for their 0:09:33.400 --> 0:09:36.959 perceived disloyalty to former President Donald Trump, the GOP won't 0:09:36.960 --> 0:09:39.640 try to expel them from the party. New York City 0:09:39.679 --> 0:09:42.680 public school cafeterias are going vegan today as part of 0:09:42.679 --> 0:09:45.480 a new policy from Mayor Adams that starts this week. 0:09:45.760 --> 0:09:49.200 Public school students and queens had mixed reviews. I'll be winning, 0:09:50.120 --> 0:09:54.559 but it's Adams is a vegan himself. Global News twenty 0:09:54.559 --> 0:09:57.199 four hours a day on air and on Bloomberg Quick Take, 0:09:57.240 --> 0:09:59.720 powered by more than twenty seven hundred journalists and analysts 0:09:59.720 --> 0:10:03.319 and when a hundred twenty countries. Michael bar this is Bloomberg. 0:10:03.720 --> 0:10:10.959 Try anything once. Thank you. Michael's five ten on Wall 0:10:10.960 --> 0:10:12.760 Street Town with the Bloomberg Sports. I'll take good morning, 0:10:12.840 --> 0:10:15.480 Jock Stead Showery alright, Good morning, Nathan. Two days after 0:10:15.520 --> 0:10:18.320 the Brian Flora's laws suit, the Giants responded with a 0:10:18.360 --> 0:10:23.240 strongly worded statement. They called Flora's allegations disturbing and simply false. 0:10:23.320 --> 0:10:25.960 They say they took Flora's candidacy to be their next 0:10:25.960 --> 0:10:28.920 coach serious and deny they had already made the decision 0:10:28.920 --> 0:10:32.120 to hire Brian day Ball before they interviewed Flora's worth, 0:10:32.160 --> 0:10:35.640 noting the now infamous Bill Belichick text meant for day 0:10:35.679 --> 0:10:37.959 Ball they went to Flora's took place even before day 0:10:38.000 --> 0:10:41.000 Ball had his interview. The Giants reacted to that text, 0:10:41.000 --> 0:10:43.880 saying they have no affiliation with Belichick, he does not 0:10:44.040 --> 0:10:46.520 speak for them. Day Ball and the Giants name Mike 0:10:46.600 --> 0:10:49.400 Cafk their offensive coordinary has been the quarterbacks coach in 0:10:49.520 --> 0:10:52.960 Kansas City, Doug Peterson, who coached Philadelphia their only Super 0:10:53.000 --> 0:10:56.280 Bowl win and named the new coach of the Jacksonville Jaguars. St. John's. 0:10:56.280 --> 0:10:59.360 With a ninety to seventy seven win at Georgetown, Julian 0:10:59.400 --> 0:11:02.640 Chempagny only seven points Patrick Ewing's Hoyas oh and nine 0:11:02.640 --> 0:11:05.120 in the Big East Top ten teams met out West 0:11:05.160 --> 0:11:08.440 Arizona beat d C L A seventy sixty six. NBA 0:11:08.520 --> 0:11:10.800 Warriors beat the King's their eighth win in a row. 0:11:10.840 --> 0:11:13.520 Clay Thompson's best games since his return twenty three points. 0:11:13.559 --> 0:11:16.640 Trey Young scored forty three Atlanta put an end to 0:11:16.720 --> 0:11:19.960 Phoenix's eleven game win streak. The Nets have lost six 0:11:20.000 --> 0:11:22.320 in a row. Plate tonight at Utah, James Harden named 0:11:22.360 --> 0:11:24.960 the reserve for the upcoming NBA All Star Game. Kevin 0:11:25.000 --> 0:11:27.280 Durant not the only Injurednet. Joe Harris has been out 0:11:27.320 --> 0:11:29.559 for some time, and now there's word Harris may need 0:11:29.600 --> 0:11:32.880 a second ankle surgery. To All Star Games this weekend, 0:11:32.960 --> 0:11:36.680 both in Las Vegas, NHL tomorrow Pro Bowl on Sunday, 0:11:37.080 --> 0:11:40.320 Opening ceremonies this morning in Beijing. Sight of the two 0:11:40.320 --> 0:11:43.800 thousand and eight Summer Olympics and now the Winter Games. 0:11:43.880 --> 0:11:47.080 John stash Eward, Bloomberg Sports, Nathan all Right, John thank 0:11:47.200 --> 0:11:51.240 USMP futures up twenty two points, Nowtout features up thirty one, 0:11:51.280 --> 0:11:54.839 Nestsect features leading the games on this Friday morning, up 0:11:54.840 --> 0:11:58.720 a hundred sixty eight points. On the heels of positive 0:11:58.840 --> 0:12:01.560 Amazon earnings. Talk about it next to Matthew Blocks him 0:12:01.559 --> 0:12:08.560 of Bloomberg Intelligence. This is Bloomberg Bloomberg eleven three oh 0:12:08.559 --> 0:12:11.000 weather winter Weather Advisory Today. This rain will change to 0:12:11.080 --> 0:12:13.760 sleet and snow, temperatures falling through the day. By tomorrow 0:12:13.800 --> 0:12:16.640 mostly sunny, upper twenties will be in the low thirties 0:12:16.640 --> 0:12:22.480 by Sunday, currently rain and fifty five in Central Park markets. 0:12:22.559 --> 0:12:25.640 Headlines and breaking news twenty four hours a day at 0:12:25.640 --> 0:12:29.080 Bloomberg dot Com, the Bloomberg Business Out and at Bloomberg 0:12:29.160 --> 0:12:39.400 Quick Tape. He's a Bloomberg Business Flash and I'm Cameron Moscow, Usta, 0:12:39.520 --> 0:12:42.680 Indis future is rallying as earnings optimism returns to the 0:12:42.720 --> 0:12:45.880 technology sector. Contracts and the tech heavy NASDAC up more 0:12:45.920 --> 0:12:48.520 than one per cent this morning as e commerce tighten. 0:12:48.640 --> 0:12:52.679 Amazon jumps about in early trading after posting a big 0:12:52.679 --> 0:12:55.080 beat on cloud computing profit and raising the price of 0:12:55.120 --> 0:12:58.400 prime and memberships. A hawkish chorus from central banks is 0:12:58.440 --> 0:13:00.760 weighing on stocks in Europe, and we check the markets 0:13:00.800 --> 0:13:03.960 every fifteen minutes throughout the trading day. On Bloomberg, SNP 0:13:04.160 --> 0:13:06.760 futures are up twenty one points down futures up twenty 0:13:06.800 --> 0:13:09.880 nine and NASDAG futures of one eight. The decks in 0:13:09.920 --> 0:13:12.880 Germany's down one percent. The ten year treasury of four 0:13:12.920 --> 0:13:15.160 thirty seconds, he had one point eight one percent. They 0:13:15.200 --> 0:13:17.480 yield on a two year one point to zero percent. 0:13:17.880 --> 0:13:20.360 NIMEX screwed oil is up one point six percent of 0:13:20.400 --> 0:13:22.719 a dollar forty seven and ninety one dollar seventy four 0:13:22.800 --> 0:13:25.360 cents of barrel. Comics called up half percent or nine 0:13:25.360 --> 0:13:29.040 dollars fifty cents. At eighteen thirteen sixty announced the euro 0:13:29.160 --> 0:13:31.559 one point one four six nine against the dollar. British 0:13:31.600 --> 0:13:34.320 found one point three five eight and that's a Bloomberg 0:13:34.360 --> 0:13:36.760 business flash. Now here's Michael Barr with more on what's 0:13:36.760 --> 0:13:39.920 going on around the world. Michael, good morning, Good morning 0:13:40.000 --> 0:13:42.640 care In a major winter storm that already cut electric 0:13:42.720 --> 0:13:45.640 power to about three d fifty thousand homes and businesses 0:13:45.679 --> 0:13:49.319 from Texas to the Ohio Valley is aimed at Pennsylvania 0:13:49.480 --> 0:13:52.400 through New England. Ice and snow is expected to turn 0:13:52.559 --> 0:13:56.319 roads into skating rings. The crisis in Gulfing Boris Johnson's 0:13:56.360 --> 0:14:00.360 government deepened as four top aids quit. Among those quitting 0:14:00.360 --> 0:14:04.680 as UK Prime Minister's chief of staff Dan Rosenfield made 0:14:04.679 --> 0:14:08.440 the fewer over the party Gate controversy. The US leeds 0:14:08.480 --> 0:14:11.840 after the official opening day of the team figure skating 0:14:11.840 --> 0:14:15.079 event at the Beijing Winter Olympics. In the NBA, the 0:14:15.120 --> 0:14:18.360 Warriors won global news twenty four hours a day on 0:14:18.400 --> 0:14:21.840 air and on Bloomberg Quicktake, powered by more than twenty 0:14:21.920 --> 0:14:24.960 seven under journalists and analysts more than a hundred twenty countries. 0:14:25.320 --> 0:14:28.600 Michael Barr and this is Bloomberg, Nathan Alright, Michael. Thanks, 0:14:28.600 --> 0:14:31.119 It's five nineteen on Wall Street Live from the Bloomberg 0:14:31.160 --> 0:14:34.360 Interactive Broker Studios. This is Bloomberg Daybreak. At the end 0:14:34.400 --> 0:14:38.200 of I think it's quite clear to say has been 0:14:38.240 --> 0:14:41.640 a wild week for tech earnings capped off by Amazon. 0:14:41.800 --> 0:14:44.760 Right now, the shares are up nearly thirteen percent on 0:14:44.760 --> 0:14:47.600 a big earnings beat in the cloud actually saw it 0:14:47.720 --> 0:14:53.000 drop in online e commerce sales, but cloud business does 0:14:53.040 --> 0:14:55.240 seem to more than have made up for it. Let's 0:14:55.240 --> 0:14:57.560 get more now from Matt Blocks, some tech media and 0:14:57.600 --> 0:15:01.520 telecom analyst at Bloomberg Intelligence. Matt, great to speak with 0:15:01.560 --> 0:15:03.760 you this morning, and it was really interesting to see 0:15:03.760 --> 0:15:07.000 the spike in the share price for Amazon after they 0:15:07.000 --> 0:15:09.400 announced that they were going to raise the price of 0:15:09.440 --> 0:15:14.000 prime memberships. What's your read on this earnings? Yeah, I 0:15:14.040 --> 0:15:17.120 think I think that's definitely the bit of news that's 0:15:17.160 --> 0:15:21.280 helped them out because their revenue growth outlook for the 0:15:21.320 --> 0:15:24.680 first quarter of two is actually a touch below where Alice. 0:15:24.720 --> 0:15:27.000 We're looking at Alice, we're looking for about nine pc growth, 0:15:27.040 --> 0:15:28.920 and they gave a range of three to eight. So, 0:15:29.440 --> 0:15:31.800 you know, I think people have taken confidence from the 0:15:31.880 --> 0:15:34.680 fact that that price increase about twenty dollars a year 0:15:34.720 --> 0:15:37.280 or fifteen percent or so on the price UM. I mean, 0:15:37.880 --> 0:15:40.320 on my accounts, only had about maybe three billion or 0:15:40.360 --> 0:15:43.160 so of revenue, which had given the scale of Amazon, 0:15:43.440 --> 0:15:47.880 isn't very much, but it's high margin revenue and it 0:15:47.960 --> 0:15:53.240 will help to compensate for inflationary pressure on wages and 0:15:53.360 --> 0:15:57.040 logistics costs, energy costs, um. So I think in terms 0:15:57.080 --> 0:16:01.360 of the profit outlook for the core on retail business, UM, 0:16:01.520 --> 0:16:03.880 that definitely helped. But you know, I think, as you mentioned, 0:16:03.920 --> 0:16:08.360 you know, the cloud business still growing very nicely, up 0:16:08.520 --> 0:16:11.840 forty year on year and with a very good margin, 0:16:13.320 --> 0:16:17.320 and the profits from that business outweighed the losses from 0:16:17.360 --> 0:16:21.160 the retail business in Q four. Obviously they invested very 0:16:21.160 --> 0:16:23.320 heavily and their flag they're investing heavily in the in 0:16:23.360 --> 0:16:26.200 the retail business to make sure that people got their 0:16:26.240 --> 0:16:29.520 goods and that they had enough staff to to manage 0:16:29.520 --> 0:16:33.240 the warehouses. Is that where the core businesses now for Amazon? 0:16:33.440 --> 0:16:36.040 Is it the cloud? I mean, obviously the the online 0:16:36.080 --> 0:16:39.400 retail business is the is the most visible side for 0:16:39.440 --> 0:16:42.800 Amazon for the consumer. But is the cloud really where 0:16:42.800 --> 0:16:46.200 it's at for Amazon? Um? Yeah? But do you know what, 0:16:46.240 --> 0:16:48.480 and I think maybe another reason why the shares are 0:16:48.480 --> 0:16:50.480 doing well today is that I guess you know that 0:16:50.840 --> 0:16:54.560 there are three places that's absolutely that the cloud is 0:16:54.720 --> 0:16:59.600 key to UM growth and profitability. But you know, online 0:16:59.640 --> 0:17:02.320 retail is always going to be UM, you know. And 0:17:02.360 --> 0:17:04.760 they've got a call business for them and linked to that, 0:17:04.840 --> 0:17:09.480 they have this new advertising led to the business, which 0:17:09.520 --> 0:17:12.919 for the first time they gave some more details on. 0:17:13.040 --> 0:17:17.199 So in the fourth quarter that generated just shy of 0:17:17.400 --> 0:17:21.560 ten billion dollars of revenue, up thirty two per year 0:17:21.600 --> 0:17:27.240 on year. By comparison, Meta generated about thirty three billion 0:17:27.280 --> 0:17:29.199 dollars of sales, so it's about a third of the 0:17:29.240 --> 0:17:34.400 size UM of metas, so not an insignificant business at all, 0:17:34.720 --> 0:17:36.600 and it's going to continue to grow. And it's a 0:17:36.720 --> 0:17:39.840 different kind of advertising to the stuff that meta gets, 0:17:40.080 --> 0:17:42.440 which I think people will see as more sticky. It's 0:17:42.600 --> 0:17:45.720 um it's what a lot of people kind of call 0:17:46.240 --> 0:17:48.639 kind of trade budgets. So it's more the stuff that 0:17:48.680 --> 0:17:50.760 if you know, if you're a marketing team and you're 0:17:50.760 --> 0:17:53.760 wanting to promote your product in a real bricks and 0:17:53.800 --> 0:17:56.840 mortar store, you would put under the line marketing dollars 0:17:56.920 --> 0:17:59.720 behind that. And that's the kind of business they're picking 0:17:59.800 --> 0:18:04.719 up as companies and brands look to advertise their wares 0:18:05.400 --> 0:18:08.800 across the Amazon footprints. So that's a really healthy business, 0:18:08.880 --> 0:18:11.720 be high margin for them, and adds a third leg. 0:18:11.960 --> 0:18:18.040 It's a very diversified platform. Obviously, investors are buoyed a bit. 0:18:18.040 --> 0:18:22.080 I think by the lift in the price of Prime memberships. 0:18:22.160 --> 0:18:24.119 Is there a risk though, that it drives some prime 0:18:24.119 --> 0:18:26.320 members away to see the price go up by by 0:18:26.320 --> 0:18:29.680 that match. I think there's there's a risk. I think 0:18:29.720 --> 0:18:32.879 that they obviously asked us yesterday an analyst core. I 0:18:32.880 --> 0:18:37.760 think the company's viewers that they don't see customers churning 0:18:37.760 --> 0:18:41.679 away because of that. I think there's um um, you know, 0:18:41.760 --> 0:18:44.399 some credence to that. I mean, they have spent a 0:18:44.480 --> 0:18:48.480 lot of money over the last couple of years, improving 0:18:48.520 --> 0:18:53.080 the quality of the prime offering, both in terms of 0:18:53.200 --> 0:18:57.600 accelerating deliveries in the US and internationally, and beefing up 0:18:57.640 --> 0:19:00.080 things like the music service and the video service. So 0:19:00.200 --> 0:19:05.040 you get a lot of value for that membership. Um, 0:19:05.080 --> 0:19:08.639 it's only going to four a month dollars, you know, 0:19:08.680 --> 0:19:11.960 which when you compare it to things like Netflix, UM, 0:19:12.000 --> 0:19:14.480 actually pretty good value still, and they haven't put the 0:19:14.480 --> 0:19:16.160 price up for quite a few years, so I think, 0:19:16.200 --> 0:19:20.360 you know, it's such a central part of most people's 0:19:20.400 --> 0:19:24.359 lives now, I think they'll be at a UM limit. 0:19:24.520 --> 0:19:27.840 Any subscribe to losses may maybe even continue to grow 0:19:27.920 --> 0:19:30.560 that prime base. All right, Thanks for this, Matt, as 0:19:30.560 --> 0:19:33.400 we continue to watch the share price of Amazon grow 0:19:33.560 --> 0:19:36.719 this morning, up more than twelve percent in the pre market. 0:19:36.840 --> 0:19:40.080 Matt Bloxham is a tech, media and telecom analyst from 0:19:40.080 --> 0:19:43.880 Bloomberg Intelligence five twenty four on Wall Street. Now, as 0:19:43.920 --> 0:19:47.160 we turn two jobs, getting ready for the January payrolls 0:19:47.160 --> 0:19:49.040 report to come out just a little more than three 0:19:49.080 --> 0:19:53.160 hours time. Already, there have been quite a few warnings 0:19:53.240 --> 0:19:56.199 that this could be a tough payrolls print thanks to 0:19:56.200 --> 0:19:59.480 the omicron variant. Let's bring a Jennifer Lee, now senior 0:19:59.480 --> 0:20:02.920 economis at BEMO Capital Markets. Of course you probably saw 0:20:03.000 --> 0:20:06.720 this week Jennifer, the Labor Secretary, Marty Walsh, and President 0:20:06.720 --> 0:20:10.400 Biden warning that we could see a slump in jobs 0:20:10.440 --> 0:20:12.880 growth in the month of January thanks to oh Macron. 0:20:13.080 --> 0:20:16.200 Pretty wide range in terms of what economists are thinking, 0:20:16.240 --> 0:20:18.359 we're going to see this morning. What's your view of 0:20:18.359 --> 0:20:21.480 what we're going to get? Straighting, let's get you have 0:20:21.520 --> 0:20:23.000 to date on the news you need to know at 0:20:23.000 --> 0:20:26.200 this shower. US futures are bouncing back in a big 0:20:26.240 --> 0:20:29.560 way after yesterday's sell off. It to do in large 0:20:29.560 --> 0:20:33.440 part to Amazon, which is surging at twelve percent following earnings. 0:20:33.440 --> 0:20:35.879 And Ed Ludlow has more from our Bloomberg nine sixty 0:20:35.920 --> 0:20:38.880 newsroom in San Francisco. It was a strong holiday court 0:20:38.920 --> 0:20:42.720 of for Amazon, despite supply chain disruptions, labor shortages and 0:20:42.920 --> 0:20:46.120 rising input costs, and really beat on the bottom line. 0:20:46.119 --> 0:20:48.760 It was monster profit, but the author house moves were 0:20:48.840 --> 0:20:52.159 driven by a boost in price to Amazon Prime. It 0:20:52.160 --> 0:20:54.800 will rise by twenty dollars to a hundred and thirty 0:20:54.880 --> 0:20:57.480 nine dollars in the US, and all the cool executives 0:20:57.520 --> 0:20:59.480 are really at pains to point out that this isn't 0:20:59.480 --> 0:21:02.600 just about discount on shipping. There's more value add like 0:21:02.640 --> 0:21:06.000 a pipeline of live sports content on new series like 0:21:06.160 --> 0:21:08.560 Lord of the Rings which should be coming this year 0:21:08.880 --> 0:21:12.320 and love Loo Boom Bang News San Francisco. Alright, ed, thanks. 0:21:12.320 --> 0:21:15.200 We're also seeing a bounce back in Snap and Pinterest 0:21:15.240 --> 0:21:20.240 shares following their earnings reports. Snap is surging fifty, Pinterest 0:21:20.400 --> 0:21:23.600 is up sixteen, well, Nathan, as all follows the worst 0:21:23.720 --> 0:21:26.040 one day crash and the history of the stock market. 0:21:26.040 --> 0:21:30.400 Facebook parent Meta plunge percent yesterday, are raising two fifty 0:21:30.480 --> 0:21:33.800 one billion dollars in market value. There could be a 0:21:33.800 --> 0:21:36.600 silver lining for CEO Mark Zuckerberg, though, and we get 0:21:36.600 --> 0:21:39.720 the details live with Bloomberg's Rendy to Young. Good Morning, Rendy, 0:21:39.880 --> 0:21:42.840 Good morning Karen. The big question is if Facebook users 0:21:42.840 --> 0:21:46.520 are flocking to TikTok, should it be considered competition and 0:21:46.560 --> 0:21:49.760 if so, the more challenging landscape adds muscle to fight 0:21:49.760 --> 0:21:53.840 a pending government lawsuit against Meta. Since Meta's earnings, miss, 0:21:53.880 --> 0:21:57.919 CEO Mark Zuckerberg has cited competition from TikTok as a threat. 0:21:58.440 --> 0:22:01.199 That claim is at the heart of the FTC's antitrust 0:22:01.240 --> 0:22:04.560 lawsuit against Meta, which says it's a monopoly with no 0:22:04.800 --> 0:22:07.960 true competition. Live in New York. I'm gonna need a 0:22:07.960 --> 0:22:10.040 young Bloomberg daybreak, all right, we need to thank you. 0:22:10.119 --> 0:22:12.320 Turning to the economy, now we do get the payrolls 0:22:12.359 --> 0:22:14.960 report for January this morning. Consensus calls for a gain 0:22:15.000 --> 0:22:17.720 of a hundred twenty five thousand jobs. Bloomberg's. Then he 0:22:17.720 --> 0:22:21.320