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Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News.

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Speaker 2: Good morning.

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Speaker 3: I'm Nathan Hager and I'm Amy Morris. Here are the

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Speaker 3: stories we're following today.

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Speaker 4: We begin with a big deal in the financial industry.

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Speaker 4: Capital One Financial is buying Discover Financial Services. We get

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Speaker 4: the details from Bloomberg's Doug Prisner.

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Speaker 5: It's an all stock deal valued at thirty five point

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Speaker 5: three billion dollars, and it creates the largest US credit

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Speaker 5: card company by loan volume. Historically, Capital One is catered

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Speaker 5: to subprime customers who carry a balance on their cards

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Speaker 5: each month. In recent years, the bank's been trying to

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Speaker 5: attract premium customers. Discover is long focused on prime customers

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Speaker 5: with better credit ratings. This deal comes after major declines

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Speaker 5: and Discover shares during the second half of last year.

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Speaker 5: It followed a warning on lapses in compliance. The issue

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Speaker 5: ultimately led to the resignation of then CEO Roger Hawkschild

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Speaker 5: in New York. I'm Doug Prisner Bloomberg Radio. He Doug,

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Speaker 5: thank you and checking shares of both companies. Discover Financial

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Speaker 5: shares are up more than eleven percent this morning. Capital

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Speaker 5: One is down more than five and a half percent.

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Speaker 3: And the financial industry is also in focus in Europe,

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Speaker 3: shares of Barclays up more than four percent. The British

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Speaker 3: bank is going on a major cost cutting drive and

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Speaker 3: returning billions to shareholders. We get more from Bloomberg Financial

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Speaker 3: reporter Tom Metcalf.

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Speaker 6: The big number is ten billion pounds both by dividends

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Speaker 6: and buybacks, and that's coming through I think between twenty

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Speaker 6: twenty four and twenty twenty six. So yeah, that is

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Speaker 6: a nice focus on returns and obviously they're sort of

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Speaker 6: very much embracing that. The other thing is is really

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Speaker 6: relation to the investiator bank. That's in many people view

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Speaker 6: why the shares might be a bit depressed just because

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Speaker 6: it takes up something like sixty three percent of risk

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Speaker 6: weighted assets for the whole group and what the bark

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Speaker 6: is sent today as expected, we're going to see that

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Speaker 6: reduced down or we're going to try and make that

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Speaker 6: reduced down to about fifty percent. And that's not by

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Speaker 6: necessarily cutting the investment bank, but that's by really focusing

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Speaker 6: on the retail side of things.

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Speaker 3: Bloomberg Financial reporter Tom metcalfs as Barclays is also overhauling

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Speaker 3: its operations and reorganizing into five new divisions. Those will

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Speaker 3: consist of its UK retail bank, a UK corporate bank,

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Speaker 3: a private bank and wealth management arm, an investment banking division,

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Speaker 3: and a US consumer bank.

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Speaker 4: Well, we also have earnings out of the Asia Pacific. Today,

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Speaker 4: amy shares of BHP are down about two percent. First

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Speaker 4: half net income plunged eighty six percent from the year

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Speaker 4: before after oversupplying the nickel market forced the world's biggest

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Speaker 4: minor to write down the value of key assets. We

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Speaker 4: talked about the results with CEO Mike Henry.

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Speaker 7: Balance sheet remained strong, with netded at twelve point six

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Speaker 7: billion dollars and all of that has allowed us to

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Speaker 7: declare an interim dividend of seventy two US since per share. Now, yes,

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Speaker 7: we have had a couple of exceptionals, including in our

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Speaker 7: nickel business. Now, by way of a bit of context,

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Speaker 7: the nickel business is the smallest by some margin business

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Speaker 7: within the BHP portfolio.

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Speaker 4: And beyond nickel, BHP CEO Mike Henry says, iron ore

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Speaker 4: remains the company's most important revenue earner. Prices for steelmaking

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Speaker 4: material surged twenty eight percent over the reporting period and

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Speaker 4: remain historically high, and that's prompting major producers like PHP

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Speaker 4: to consider development of once stranded deposits.

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Speaker 3: Back here in the US, earning season is nearing an end,

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Speaker 3: but it's not over yet. This week's big focus comes

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Speaker 3: tomorrow when high flying chip maker and Video releases results.

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Speaker 3: Bloomberg's Charlie Pellett says it'll put a big spotlight on

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Speaker 3: artificial intelligence.

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Speaker 2: The stock is up almost fifty percent this year. Sarah Hunt,

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Speaker 2: chief market strategist at Alpine Woods Capital Management, says there's

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Speaker 2: a lot riding on this report.

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Speaker 8: This is the big question. Yes, this is great technology,

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Speaker 8: can you monetize it? And Vidia is the poster child

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Speaker 8: for that because it's the demand for those chips that's

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Speaker 8: fueling everybody's usage of all of this. If they have

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Speaker 8: any kind of wobble that anyone can say, well, maybe

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Speaker 8: this isn't as fast and as quick as we thought

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Speaker 8: it was going to be. I think that the whole

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Speaker 8: story comes into question.

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Speaker 2: It's lofty valuation means there's little room for disappointment in

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Speaker 2: New York. Charlie Pellett, Bloomberg Radio.

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Speaker 4: All right, Charlie, thank you. Let's turn to geopolitics now,

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Speaker 4: starting with developments in the Middle East. The US is

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Speaker 4: preparing to warn Israel not to attack the southern Gaza

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Speaker 4: city of Rafa. This is coming in a draft text,

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Speaker 4: and we get the details from Bloomberg's Ed Baxter.

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Speaker 9: This is a UN Security Council resolution warning against a

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Speaker 9: Rafa assault, as well as calling for a temporary cease fire.

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Speaker 9: The resolution would say that an offensive would result in

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Speaker 9: further harm to civilians and further displacement, including potentially into

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Speaker 9: neighboring countries. The draft says that could have serious implications

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Speaker 9: for regional peace and security. Up to now, the US

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Speaker 9: has been reluctant to back cease fire proposals and stood

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Speaker 9: strong with Israel, but now apparent Biden administration frustration with

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Speaker 9: Prime Minister Benjamin nettan Yahoo, who says he plans to

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Speaker 9: go ahead with the assault if hostages aren't returned by

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Speaker 9: Ramadan at Baxter Bloomberg Radio.

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Speaker 3: All right, thank you, Ed, And we should note that

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Speaker 3: Ramadan starts in roughly three weeks on March eleventh. Meantime,

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Speaker 3: Russia's in Ukraine goes on, and this morning the Ukrainian

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Speaker 3: Air Force says it shut down all twenty three drones

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Speaker 3: and missiles fired from Russia overnight. Our regional governor says

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Speaker 3: three people were hurt. The war continues without fresh assistance

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Speaker 3: from the US and now. President Biden says he is

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Speaker 3: willing to meet with House Speaker Mike Johnson to discuss

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Speaker 3: stalled aid for Ukraine and Israel. He says the death

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Speaker 3: of jailed Russian opposition leader Alexi Nevali adds to the

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Speaker 3: urgency of the moment.

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Speaker 5: The way they're walking away from the President Russia, the

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Speaker 5: way they're walking away from NATO, the way they're walking

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Speaker 5: away from leading our obligations.

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Speaker 2: He I guess you're shocking.

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Speaker 5: I've been for a while.

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Speaker 2: I've never seen you like it.

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Speaker 3: President Biden says he's considering new sanctions on Russia over

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Speaker 3: the death of Alexi Nevali, but with sanctions already on

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Speaker 3: Russia over the war, it's not clear how much more

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Speaker 3: the US can do.

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Speaker 4: Man Russian President Putin may be violating UN sanctions with

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Speaker 4: his latest move to boost ties with North Korea. According

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Speaker 4: to state media, Putin gave North Korean leader Kim Jong

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Speaker 4: un a brand new car. A Kremlin spokesman says it's

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Speaker 4: an Oorus. It's a Russian made alternative to Mercedes. Luxury

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Speaker 4: vehicles are on the UN Security Council's list of banned

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Speaker 4: items for export to North Korea, but there's little the

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Speaker 4: Council can currently do to punish Putin.

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Speaker 3: And in China, the weak property market remains a major

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Speaker 3: concern for authorities, and now China is ramping up support

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Speaker 3: for the property sector with one of its biggest rate

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Speaker 3: cuts ever. Bloomberg Daybreak Asia anchor Brian Curtis has more

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Speaker 3: from Hong Kong.

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Speaker 10: Chinese banks cut the five year loan prime rate by

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Speaker 10: twenty five basis points to three point nine to five percent.

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Speaker 10: It was the first cut in the rate in eight

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Speaker 10: months and the biggest ever. The one year rate was

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Speaker 10: maintained at three point four to five percent. Now, the

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Speaker 10: move on the five year raises expectations of more aggressive

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Speaker 10: measures in the coming months. The lower rate will allow

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Speaker 10: more cities in China to reduce the minimum mortgage rates

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Speaker 10: for home buyers, although we have to say the reaction

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Speaker 10: in the markets today was underwhelming. In Hong Kong, Brian Curtis,

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Speaker 10: Bloomberg Radio.

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Speaker 4: And that's time to take a look at some of

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Speaker 4: the other stories making news in New York and around

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Speaker 4: the world. For that, we're joined by Bloomberg's Michael Barr,

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Speaker 4: Good morning, Michael.

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Speaker 11: Good morning, Nathan. Former President Donald Trump is now comparing

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Speaker 11: the sudden death of Russian opposition leader Alexing Navaldi to

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Speaker 11: his own political problems. According to Trump, Navaldi's death has

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Speaker 11: quote may be more and more aware of what is

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Speaker 11: happening in our country and that rigged elections and grossly

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Speaker 11: unfair courtroom decisions are destroying America. Presidential rival Nikki Haley

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Speaker 11: jumped on Trump for refusing you condemned Vladimir Putin.

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Speaker 4: I don't know why he keeps getting weak in the

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Speaker 4: knees when it comes to Russia. But I'll tell you

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Speaker 4: what Russia is not getting weak in the knees.

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Speaker 11: Haley spoke on the campaign trail in Camden, South Carolina.

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Speaker 11: President Joe Biden is said to have raised forty two

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Speaker 11: million dollars for his re election campaign and the Democratic

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Speaker 11: Party in January. The president now heads the West Coast

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Speaker 11: for events with deep pocketed donors. Biden's campaign and says

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Speaker 11: the president ended January with the one hundred and thirty

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Speaker 11: million dollar war chest for his re election effort. Nearly

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Speaker 11: the entire California coastline is under flood advisories affecting about

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Speaker 11: thirty seven million people. Days of heavy rain in the

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Speaker 11: drought stricken state has left the soil saturated, causing the

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Speaker 11: risk of dangerous flash flooding in the Bay Area of

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Speaker 11: The rain washed out part of Highway eighty four in

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Speaker 11: Almeda County, causing traffic delays. Caltrans spokesman Bartney.

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Speaker 7: The pavement slips down right or becomes unnavigable, so we

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Speaker 7: can't have people driving on.

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Speaker 11: Residents of San Francisco say they are afraid for the

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Speaker 11: homeless because of the flooding. Supporters of a ceasefire between

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Speaker 11: Israel and Hamas held a rally in Paterson, New Jersey.

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Speaker 11: One of the attendees included Reverend Barry Graham, pastor at

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Speaker 11: Canaan Baptist Church of Patterson. We see the death, we

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Speaker 11: see the destruction, we see little children being carried out,

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Speaker 11: and I can't understand how anyone of good faith could

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Speaker 11: stand and not be convicted by what they see. Other

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Speaker 11: attendees said the US cannot remain complicit. The anger from

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Speaker 11: the New York Archdiocese continues over the funeral of a

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Speaker 11: transgender community leader at Saint Patrick's Cathedral in Manhattan. The

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Speaker 11: Roman Catholic Archdiocese of New York condemned Thursday's funeral of

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Speaker 11: Cecilia Gentilli. Tintilly, who was fifty two, was known as

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Speaker 11: a leading advocate for other transgender people, as well as

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Speaker 11: sex workers and people with HIV. Her funeral drew hundreds

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Speaker 11: of enthusiastic people to the church. Kathy run, a communications

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Speaker 11: director for the National LGBTQ Task Force, told ABC seven

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Speaker 11: it was more celebratory than we normally see in a

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Speaker 11: Catholic church, and actually it was kind of refreshing.

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Speaker 12: I think when one of the eulogists, you know, used

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Speaker 12: the word for prostitute in Spanish, and I looked at

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Speaker 12: the person sitting next to me and said, wait till

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Speaker 12: they translate that.

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Speaker 11: In a written statement, the past here of Saint Patrick's,

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Speaker 11: the Reverend Enrique Salvo, said they had no idea our

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Speaker 11: welcome in prayer would be degraded in such a sacrilegious

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Speaker 11: and deceptive way. Global News twenty four hours a day

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Speaker 11: and whenever you want it with Bloomberg News. Now, I'm

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Speaker 11: Michael Barr. This is Bloomberg.

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Speaker 4: Nathan all right, Michael, thanks time out for the Bloomberg

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Speaker 4: sports Update brought to you by Tri State out of

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Speaker 4: Years John stash All Ranks.

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Speaker 13: Nathan Jack Vaughn joined the Brooklyn Nets as an assistant

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Speaker 13: back in twenty sixteen. Four years later, the Nets fired

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Speaker 13: Kenny Atkinson, Vaughn philed in. Steve Nash was then brought

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Speaker 13: in his coach and Vaughn went back to being an assistant,

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Speaker 13: and then early twenty twenty two, Nash got fired, Vaughan

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Speaker 13: returned his head coach, held the job until yesterday. Fired

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Speaker 13: with the Nets twenty one and thirty three. Their most

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Speaker 13: recent game was a loss in Boston by fifty points.

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Speaker 13: Assistant Kevin Ollie takes over. He coached Yukon of the

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Speaker 13: National championship a decade ago in Tampa. Full Yankee team workout,

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Speaker 13: including the prize offseason pickup Juan Soto. He's only signed

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Speaker 13: for this upcoming season.

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Speaker 14: For me, I'm just focusing in twenty four I'm here

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Speaker 14: to play baseball. I'm focusing on playing this year and

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Speaker 14: try to win as much as you know we can

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Speaker 14: and being a championship to New York.

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Speaker 13: Yanke you GM. Brian Cashman recently admitted the odds are

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Speaker 13: this is a one years situation, but for now Aaron

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Speaker 13: Judge will have another star joining him in the lineup.

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Speaker 15: I'm excited. I'm excited.

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Speaker 10: You know.

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Speaker 15: It's he's a generational talent.

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Speaker 11: You know.

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Speaker 15: We give up quite a few, you know, special pitchers

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Speaker 15: in the package. But I think everybody, everybody in Pinchtrofts

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Speaker 15: is looking forward to having won Soto Grissom, you know,

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Speaker 15: due all those guys you know in Pinchtrops. So it's

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Speaker 15: going to be a fun years.

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Speaker 13: Also from baseball, Red Sox signed the leader William Hendricks

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Speaker 13: for two years. He may not pitch much, if at all,

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Speaker 13: this season due to Tommy John surgery. The Giants signed

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Speaker 13: thirty seven year old Pablo Sandoval for if he makes

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Speaker 13: the team a third stint in San Francisco, part of

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Speaker 13: three World Series Championship Teams Series MVP back in twenty twelve,

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Speaker 13: sand of bal hasn't played the Major se The Lerner

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Speaker 13: family has owned the Washington Nationals since six two years ago,

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Speaker 13: they put the team on the market. Now they're taking

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Speaker 13: them off. William Byron won the rain del A Daytona

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Speaker 13: five hundred hockey. The Ruins beat Dallas four to three

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Speaker 13: and a shootout the Stars at the Garden tonight to

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Speaker 13: play the Rangers of one seven in a row Minnesota

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Speaker 13: Big Vancouver with a football like score of ten to seven.

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Speaker 13: The Wild scored seven goals in the third period. John

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Speaker 13: Stashaway Bloomberg.

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Speaker 16: Sport from coast to coast, from New York to San Francisco,

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Speaker 16: Boston to Washington, DC, nationwide on SYRIASXAM, the Bloomberg Business

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Speaker 16: app in Bloomberg dot com. This this is Bloomberg day Break.

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Speaker 2: Good morning.

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Speaker 4: I'm Nathan Hager on a morning where we have two

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Speaker 4: big stories in the financial sector. Capital One is buying

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Speaker 4: Discover Financial and a thirty five billion dollar all stock

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Speaker 4: deal that will create a credit card juggernaut. And Barclays

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Speaker 4: is embarking on a major cost cutting drive with a

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Speaker 4: goal to return at least twelve billion dollars to shareholders

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Speaker 4: in the UK. For more on these stories, we're joined

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Speaker 4: by Bloomberg's Charlie Wells. And Charlie, let's start off with

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Speaker 4: this Capital One Discover deal. What is the goal here

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Speaker 4: for both these companies to engage in this massive tie up.

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Speaker 1: Well, the goal here really is to compete. And I mean,

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Speaker 1: you know, there have been such intense credit card wars

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Speaker 1: in the United States over the past few years. And

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Speaker 1: what really happens here is Capital One gets size, they

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Speaker 1: get size, and they get the technology that comes from Discover.

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Speaker 1: So what is so unique about Discover is that they

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Speaker 1: have their own payment networks and that is something that

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Speaker 1: is actually very enviable for a lot of credit card

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Speaker 1: companies because it gives them a lot of control over

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Speaker 1: how much they can charge merchants. Now, what's also interesting

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Speaker 1: about Discover and what is really attractive for Capital One.

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Speaker 1: We know that Capital One has been trying to get

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Speaker 1: more prime borrowers over the past few years, and finally

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Speaker 1: with Discover, they're getting a huge tranch of those prime

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Speaker 1: Discover borrowers.

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Speaker 4: That's a really interesting point because in their history Capital

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Speaker 4: One and Discover have both catered to a very different

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Speaker 4: type of customer, haven't they.

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Speaker 1: That's exactly right, and look, Capital One largely subprime. These

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Speaker 1: are the sorts of borrowers who tend to have balances,

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Speaker 1: you know, on their books at the end of the

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Speaker 1: statement period. Over the past few years, we've really seen

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Speaker 1: a lot of marketing, you know, celebrities like Jennifer Garner,

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Speaker 1: Samuel Jackson in commercials asking that question what's in your wallet,

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Speaker 1: whereas Discover, you know, they have that more prime borrower.

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Speaker 1: And what's great about prime borrowers for credit card companies,

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Speaker 1: they tend to spend more and they tend to be

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Speaker 1: more loyal.

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Speaker 4: And on the opposite side of the coin, Barclays sounds

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Speaker 4: like it's going to be spending less or at least

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Speaker 4: cutting costs with this major cost cutting drive, and it's

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Speaker 4: going to involve a pretty major restructuring as well.

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Speaker 1: That's exactly right. So this is Barkley's first major strategy

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Speaker 1: update since twenty sixteen, and it is a really big

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Speaker 1: test for the ceocs than kind of Krishnan. And what

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Speaker 1: is actually happening at Barkley's is really this pressure to

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Speaker 1: improve share price performance. So Barkley's has lagged a lot

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Speaker 1: of peers, and the goal here really is to kind

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Speaker 1: of bring expenses under control, to return capital to investors

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Speaker 1: via share of buybacks and dividends, and to simplify the

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Speaker 1: bank in a lot of ways, to overhaul its operations,

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Speaker 1: reorganizing into five new divisions UK retail Bank, UK Corporate Bank,

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Speaker 1: a private bank, and a wealth management arm, as well

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Speaker 1: as an investment bank. Decision and a division excuse me,

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Speaker 1: and US Consumer Bank.

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Speaker 4: So how could a restructuring like this get Barclays toward

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Speaker 4: this goal that it's put out there of a twelve

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Speaker 4: percent or more return on equity in the next two years.

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Speaker 1: It's difficult, and I think a lot of this points

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Speaker 1: back to that investment banking division, because that just soaks

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Speaker 1: up so much capital that Barclays has, you know, at

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Speaker 1: the expense of other parts of the business. You know,

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Speaker 1: what we're seeing at Barclays is a little bit of

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Speaker 1: an increased focus on the retail business. So you saw

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Speaker 1: in recent weeks that it announced it would acquire a

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Speaker 1: lot of Tesco Plc's banking business, and that is a

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Speaker 1: very high street bank here in the UK, and that

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Speaker 1: seems to indicate an attempt to go into some of

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Speaker 1: these to these parts of banking that you require less

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Speaker 1: capital but could be potentially more lucrative.

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Speaker 4: This is Bloomberg Daybreak Today, your morning brief on the

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Speaker 4: stories making news from Wall Street to Washington and beyond.

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Speaker 4: iHeartRadio app, and on Bloomberg dot Com. I'm Nathan Hager,

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Speaker 4: and I

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