WEBVTT - Bloomberg Daybreak: July 19, 2022 - Hour 2 (Radio) 0:00:04.280 --> 0:00:07.560 Live from the Bloomberg Interactive Burgers Studios. This is Bloomberg 0:00:07.640 --> 0:00:11.480 day Break for Tuesday, July two. Coming up the shower. 0:00:11.840 --> 0:00:14.960 Apple joins the list of companies putting a lid on hiring. 0:00:15.320 --> 0:00:19.520 IBM shares drop on earnings. Netflix reports today. President Biden 0:00:19.600 --> 0:00:22.840 is said to be considering declaring a climate emergency, and 0:00:22.920 --> 0:00:25.959 gas press fall for a thirty five straight day, hitting 0:00:25.960 --> 0:00:29.520 a two month low, a massive thunderstorm and flooding rains 0:00:29.600 --> 0:00:32.360 rink havoc on parts of the city. I'm John Tucker. 0:00:32.640 --> 0:00:35.640 That's story straight ahead. I'm John stas Shaller and sports 0:00:35.680 --> 0:00:39.200 Peter Alonzo dethroned Juan Soto won the home run derby 0:00:39.320 --> 0:00:41.720 m l A where the All Star Game takes place tonight. 0:00:44.479 --> 0:00:48.680 That's all strain ahead on Bloomberg Daybreak on Bloomberg eleven three, 0:00:48.720 --> 0:00:53.120 on New York, Bloomberg one, Washington, d C, Bloomberg one 0:00:53.159 --> 0:00:57.680 oh six one, Boston, Bloomberg nine sixties and Francisco Syrius 0:00:57.680 --> 0:01:01.200 Exam one nineteen and around the world on Bloomberg Radio 0:01:01.320 --> 0:01:08.080 dot Com and via The Bloomberg Business. Good Morning, I'm 0:01:08.160 --> 0:01:11.120 Nathan Hagar, and I'm Karen Moscow and US stock in 0:01:11.200 --> 0:01:13.280 Next Future is on the rise this morning. We're coming 0:01:13.319 --> 0:01:15.160 up to six oh one on Wall Street, and we 0:01:15.240 --> 0:01:17.760 check the markets every fifteen minutes throughout the trading day. 0:01:17.880 --> 0:01:20.600 On Bloomberg and SMP futures are up about twenties six 0:01:20.600 --> 0:01:23.080 points in Our futures up a hundred fifties seven and 0:01:23.200 --> 0:01:25.840 Nastack Future is up about seventy three. The ten year 0:01:25.880 --> 0:01:29.080 Treasury Little Change yield two point eight percent, and they 0:01:29.160 --> 0:01:31.880 yield on the two year three point one six percent, 0:01:32.240 --> 0:01:36.240 and NIMEX screwed Oil is down three tenths of a percent. Nathan, Karen, 0:01:36.280 --> 0:01:38.720 we begin with a growing number of companies clamping down 0:01:38.720 --> 0:01:41.039 on hiring. It's a trend showing up in firms from 0:01:41.040 --> 0:01:43.840 tech to banking. Let's get the latest live from Bloomberg's 0:01:43.880 --> 0:01:47.000 Rnda Young. Good morning, Rnita, Good morning, Nathan. Bloomberg. Sources 0:01:47.040 --> 0:01:50.320 say Apple is putting a lid on hiring to limit spending. 0:01:50.720 --> 0:01:53.880 Leaders have not adopted a company wide policy, but this 0:01:54.000 --> 0:01:58.120 more cautious approach mimics moves by Amazon and Microsoft, and 0:01:58.160 --> 0:02:00.960 it's more evidence that even Silica and Valley is worried 0:02:01.000 --> 0:02:04.960 about an impending recession. Now, Goldman Sachs also plans to 0:02:05.040 --> 0:02:09.400 slow hiring to reign in expenses. CFO Dennis Coleman says 0:02:09.560 --> 0:02:12.800 Goldman could also reduce the pace of replacing staff it 0:02:12.840 --> 0:02:17.160 loses because of attrition and will reinstate annual performance reviews. 0:02:17.760 --> 0:02:20.520 Live in New York, I'm rened a young Bloomberg daybreak. 0:02:20.600 --> 0:02:22.480 All right, we need to thank you. We're also seeing 0:02:22.520 --> 0:02:25.280 a tepid outlook from another big name and tag. Shares 0:02:25.320 --> 0:02:28.200 of IBM or down about five percent in early trading. 0:02:28.400 --> 0:02:31.440 The company has lowering forecast for free cash flow this 0:02:31.520 --> 0:02:33.800 year due to the impact of a strong dollar and 0:02:33.840 --> 0:02:36.919 the loss of business in Russia. Bloomberg's Charlie Pellett has 0:02:36.960 --> 0:02:41.919 more the revision overshadowed results the top analysts estimates, signaling 0:02:41.960 --> 0:02:46.560 the demand from mainframe computers, consulting, and cloud services remains 0:02:46.600 --> 0:02:51.239 strong amid concerns of a pullback in tech spending. IBM 0:02:51.320 --> 0:02:54.639 set of estimates free cash flow of ten billion dollars 0:02:54.639 --> 0:02:57.320 this year, at the low end of a previous range 0:02:57.320 --> 0:03:01.040 of ten to ten point five billion dollars. Chief financial 0:03:01.040 --> 0:03:03.960 Officer Jim Kavanaugh said the reduced range is not a 0:03:04.000 --> 0:03:08.120 result of a broader business slowdown. In New York. Charlie 0:03:08.120 --> 0:03:11.359 Pellett Bloomberg, pay break, all right, Charlie, thank you. Earnings 0:03:11.400 --> 0:03:13.840 continue to roll in with ten companies in the SMP 0:03:14.480 --> 0:03:17.840 reporting today. This afternoon, we hear from Netflix. Bloomberg's Tom 0:03:17.840 --> 0:03:20.480 Busby has a preview, well the keeper investors will be 0:03:20.560 --> 0:03:24.079 subscriber losses for the second quarter, which the streaming giant 0:03:24.160 --> 0:03:27.640 predicted good total two million in its previous earnings report 0:03:27.639 --> 0:03:30.840 in April, when it announced its first ever subscriber losses. 0:03:31.200 --> 0:03:33.600 Also have note whether the blowout success of the latest 0:03:33.600 --> 0:03:37.400 season of Stranger Things may have helped Netflix keep some subscribers, 0:03:37.720 --> 0:03:40.640 and it's new crackdown on password sharing now when effect 0:03:40.680 --> 0:03:43.800 in five Latin American markets. Bloomberg and Census calls for 0:03:43.840 --> 0:03:47.360 earnings per share of two dollars cents revenues of just 0:03:47.440 --> 0:03:51.680 over eight billion dollars. Tom Busby Bloomberg, daybreak, all right, Tom, 0:03:51.720 --> 0:03:54.080 thank you. None of the latest, and Twitter's legal dispute 0:03:54.080 --> 0:03:57.560 with Elon Musk. Twitter is dismissing Musk's complaints that he 0:03:57.600 --> 0:04:01.360 does not have enough information about space AM and robot accounts. 0:04:01.600 --> 0:04:04.920 The company calls it a relevant sideshow and wants a 0:04:05.000 --> 0:04:07.240 judge to hold a trial as soon as possible over 0:04:07.360 --> 0:04:11.240 Musk's cancelation of his forty four billion dollar takeover. Watching 0:04:11.280 --> 0:04:13.720 Bitcoin rise this morning, Karen, but it's off its highs 0:04:13.760 --> 0:04:16.240 for the day. In fact, earlier Bitcoin almost hit twenty 0:04:16.279 --> 0:04:19.599 three thousand. The cryptocurrency has struggled to escape a nineteen 0:04:19.600 --> 0:04:22.480 to twenty two thousand range as investors licked their wounds 0:04:22.520 --> 0:04:25.599 from the recent route. Martin Chavez from six Street Partner 0:04:25.640 --> 0:04:29.720 says the time has come to finally regulate the crypto market. Regrettably, 0:04:30.160 --> 0:04:34.960 we usually wait until some calamity before there is regulation, 0:04:35.320 --> 0:04:38.680 and the questions always with this calamity big enough or 0:04:38.680 --> 0:04:41.279 does there need to be another leg down before we 0:04:41.320 --> 0:04:44.600 have the appropriate regulation. Martin Chavez at six Street Partners 0:04:44.600 --> 0:04:47.120 made the comments in an interview on Bloomberg Television. We'll 0:04:47.120 --> 0:04:49.240 have more on the future of bitcoin throughout the day 0:04:49.320 --> 0:04:52.520 as the Bloomberg Crypto Summit gets underway in New York. Well. 0:04:52.600 --> 0:04:55.679 Turning to the global economy now, Nathan, pressure is building 0:04:55.680 --> 0:04:58.560 on the European Central Bank. Sources say the ECB may 0:04:58.560 --> 0:05:01.719 consider raising interest 's by more than expected this week 0:05:01.920 --> 0:05:05.839 because the worsening inflation backdrop. Sources sat the central Bank 0:05:05.880 --> 0:05:08.560 may raise rates by fifty basis points on Thursday. That's 0:05:08.600 --> 0:05:11.640 double the twenty five point Hi get outlined just last month. 0:05:11.760 --> 0:05:13.760 Well back here in the US, Karen prices the pump 0:05:13.839 --> 0:05:16.719 keep dropping. In fact, they've fallen for thirty five straight days, 0:05:16.800 --> 0:05:19.440 hitting a two month low. Triple A says the nationwide 0:05:19.440 --> 0:05:22.160 averages just below four fifty a gallon prices have fallen 0:05:22.200 --> 0:05:24.880 more than ten percent. S it's hitting a record last month. 0:05:25.279 --> 0:05:27.880 Climate Change and Focus at the White House Nathan President 0:05:27.920 --> 0:05:31.760 Biden is reportedly considering declaring a climate emergency as soon 0:05:31.800 --> 0:05:34.920 as this week. Details now from Bloomberg's Amy Morris from 0:05:34.920 --> 0:05:38.200 our ninety nine one newsroom in Washington. Senator Jeff Murkley 0:05:38.240 --> 0:05:41.680 of Oregon says climate legislation has no chance to get 0:05:41.680 --> 0:05:44.640 through Congress. Instead, he says the president should use the 0:05:44.640 --> 0:05:48.040 full powers of the executive branch to declare an emergency, 0:05:48.320 --> 0:05:50.800 which would give him the authority to redirect funds for 0:05:50.839 --> 0:05:54.560 clean energy projects or restrict offshore drilling, and could even 0:05:54.560 --> 0:05:57.920 curtail the transport of fossil fuels. And Now sources they're 0:05:57.920 --> 0:06:01.359 telling the Washington Post that Biden is expected to announce 0:06:01.400 --> 0:06:04.840 additional actions aimed at curbing emissions as soon as this 0:06:04.920 --> 0:06:08.440 week in Washington, I'm any Morris Bloomberg daybreak. All right, Amy, 0:06:08.440 --> 0:06:10.839 thank you. Let's turn to Capitol Hill now, where computer 0:06:10.960 --> 0:06:13.280 chips are in focus. The Senate wants to quickly pass 0:06:13.360 --> 0:06:16.200 fifty two billion dollars in grants and incentives for American 0:06:16.240 --> 0:06:19.919 semiconductor makers. Senate majority leader Chuck Schumer says Democrats and 0:06:19.960 --> 0:06:23.160 Republicans are hashing out the final details. The legislation is 0:06:23.160 --> 0:06:25.599 a scaled down version of a larger bill intended to 0:06:25.640 --> 0:06:29.360 make the US technology sector more competitive with China. Supply 0:06:29.440 --> 0:06:32.400 chain issues are also in focus this morning, Nathan Treasury 0:06:32.400 --> 0:06:35.240 Secretary Janet Yellen is calling on so called to trust 0:06:35.320 --> 0:06:37.920 in to US allies to help fix the supply chain 0:06:38.240 --> 0:06:41.159 seeing in South Korea. Yelling called on US partners to 0:06:41.200 --> 0:06:45.039 strength and trade relationships with what she calls friend shoring. 0:06:45.640 --> 0:06:51.400 Freensuring is about deepening relationships and diversifying our supply chains 0:06:51.920 --> 0:06:56.159 with a greater number of trusted trading partners. The purposes 0:06:56.200 --> 0:07:00.200 to lower risks for our economy, and there's tread race. 0:07:00.200 --> 0:07:03.200 Secretary Johnny Yellen singled out China as a country on 0:07:03.200 --> 0:07:07.080 which the US and others should be less reliant futures 0:07:07.120 --> 0:07:10.440 this morning on the rise, SMP futures up about thirty 0:07:10.480 --> 0:07:13.440 points down. Futures have a hundred eighty nine nsday futures 0:07:13.480 --> 0:07:16.440 up eight five Straight ahead, your latest local headlines, plus 0:07:16.440 --> 0:07:23.920 a check of sports. This is Bloomberg. Thanks Karen six 0:07:23.960 --> 0:07:26.560 O seven on Wall Street, seventy three degrees in Central Parks. 0:07:26.560 --> 0:07:28.920 We get ready for a heat wave and we're still 0:07:29.000 --> 0:07:31.800 dealing with an accident investigation on the westbound Belt Parkway. 0:07:31.880 --> 0:07:34.520 More coming up in traffic. First John Tucker with more 0:07:34.520 --> 0:07:36.440 on what's going on in New York and around the world. 0:07:36.560 --> 0:07:39.040 John may feel a powerful thunderstore I was swept over 0:07:39.080 --> 0:07:42.800 in New York City yesterday afternoon, swamping highways, flooding trade lines, 0:07:43.520 --> 0:07:52.680 casting the evening commune into sudden disarray. Heavy rains caused 0:07:52.680 --> 0:07:55.240 a massive sinkhole to open up in the Bronx and 0:07:55.360 --> 0:07:58.120 swallow a VAM. New York City is completed in the 0:07:58.160 --> 0:08:00.400 first phase of at one point four or five another 0:08:00.440 --> 0:08:03.160 project of fortifying a section of Lower manhapt along the 0:08:03.160 --> 0:08:06.920 East River that was devastated by Hurricane Sandy. The East 0:08:06.920 --> 0:08:10.800 Side Coastal Resiliency Project will elevate park land along the 0:08:10.840 --> 0:08:15.360 East River stretching two point four miles, and temperatures in 0:08:15.400 --> 0:08:18.720 the UK set to hit a record today at Bloomberg's 0:08:18.880 --> 0:08:22.800 Advance that joins US now from sweltering London. Good Morning John. 0:08:22.840 --> 0:08:25.320 Today is said to be the hottest day on record 0:08:25.480 --> 0:08:28.080 in the UK, with temperatures as high as one hundred 0:08:28.160 --> 0:08:31.960 and seven degrees fahrenheit's That follows the warmest nights on record, 0:08:32.000 --> 0:08:35.440 with temperatures no lower than seventy eight degrees in some places. 0:08:35.840 --> 0:08:38.720 Brutal conditions have already struck India, parts of the U 0:08:38.840 --> 0:08:41.240 S and Western Europe this year, but they are a 0:08:41.280 --> 0:08:44.240 particular challenge of places like Britain, which are not used 0:08:44.240 --> 0:08:47.040 to extremes of hot or cold. In London, I'm you 0:08:47.120 --> 0:08:50.000 in Potspin, Big Daybreak and the January six Committee will 0:08:50.040 --> 0:08:53.439 be extending its inquiry. That story this morning from Bloomberg's 0:08:53.520 --> 0:08:57.600 head Baxter Cherry. Bennie Thompson says information keeps coming in. 0:08:57.960 --> 0:09:00.960 He says it includes a secret service text. First, he 0:09:01.000 --> 0:09:03.800 says the committee will put out a scale back interim 0:09:03.880 --> 0:09:07.240 report in September, which is when it was scheduled to end. 0:09:07.720 --> 0:09:10.199 He says now he will not predict a date when 0:09:10.240 --> 0:09:13.280 the final report would be issued. The committee will hold 0:09:13.320 --> 0:09:16.760 another public hearing Thursday, and then Thompson says they will 0:09:16.840 --> 0:09:20.480 decide where to go from there. In San Francisco, I'm 0:09:20.520 --> 0:09:23.760 at Baxter Bloomberg Daybreak. It will take almost a lifetime 0:09:24.000 --> 0:09:28.120 seven decades for US colleges and universities to achieve racial 0:09:28.200 --> 0:09:31.480 parody among its freshman classes. That according to a new 0:09:31.520 --> 0:09:34.600 studied by McKenzie and Company, they analyze data for more 0:09:34.640 --> 0:09:38.720 than three thousand institutions with enrollment of about two point 0:09:38.760 --> 0:09:42.480 four million first time students, enrollment among black and Native 0:09:42.520 --> 0:09:46.800 American students actually declined in some cases. Global News twenty 0:09:46.800 --> 0:09:49.160 four hours a day on air in a Bloomberg Quick Take, 0:09:49.240 --> 0:09:52.679 power by more than journalists and analysts in more than 0:09:52.720 --> 0:09:56.800 one twenty countries. I'm John Tucker and this is Bloomberg. Nathan. 0:09:56.920 --> 0:10:03.520 Thank you, John six o nine on Wall Street time 0:10:03.559 --> 0:10:06.199 for the Bloomberg Sports Update, which on stas Thanks Nathan. 0:10:06.240 --> 0:10:09.000 It's ironic that Juan Soto won the home run derby 0:10:09.000 --> 0:10:11.560 in Los Angeles because he is very much in the news. 0:10:11.679 --> 0:10:14.080 The twenty three year old star of the Washington Nationals 0:10:14.120 --> 0:10:18.040 just rejected a contract offer of fifteen years and four 0:10:18.120 --> 0:10:20.719 hundred and forty million dollars in. The Nats, who had 0:10:20.720 --> 0:10:23.520 been saying they were not going to trade Soto, are 0:10:23.600 --> 0:10:27.600 now entertaining trade offers. The Mets and Yankees both believed 0:10:27.600 --> 0:10:30.440 to be interested Soto's under his current contract until after 0:10:30.480 --> 0:10:34.600 the fourth season. By winning the Derby, Soto earned a million. 0:10:34.720 --> 0:10:37.840 He beat Seattle's Julio Rodriguez in the final. He won 0:10:37.880 --> 0:10:40.240 a half million. As a rookie, he only makes seven 0:10:40.320 --> 0:10:43.000 hundred thousand from the Maritors. The one year old Rodriguez 0:10:43.200 --> 0:10:45.120 put on a show over the first two rounds with 0:10:45.280 --> 0:10:49.640 sixty three home run semifinal losers were the Mets Pete Alonso, 0:10:49.960 --> 0:10:52.560 the two time defending champ, and forty two year old 0:10:52.600 --> 0:10:54.880 Albert Pools, who was in the field in this the 0:10:54.920 --> 0:10:57.920 final season of his Hall of Fame career. Clayton Kershaw 0:10:57.920 --> 0:11:01.720 I headed the Cooperstown someday. Surprisingly, he's never four started 0:11:01.720 --> 0:11:03.360 an All Star Game. He'll be on the mound for 0:11:03.400 --> 0:11:06.000 the National League tonight in his home part. I really 0:11:06.000 --> 0:11:08.600 didn't think anything of it at the time. I was like, well, yeah, 0:11:08.600 --> 0:11:10.880 I'll be fun to do it or whatever. But um, 0:11:10.920 --> 0:11:13.000 now that it's finally here and I get to uh, 0:11:13.120 --> 0:11:15.520 start that game tomorrow night. It just uh, it means 0:11:15.559 --> 0:11:18.080 a lot, and it means lots of my family, and 0:11:18.679 --> 0:11:21.560 we're excited. Charlie's excited, My kiddos are excited. So we're 0:11:21.600 --> 0:11:23.920 gonna we're gonna have a good time tomorrow and hopefully 0:11:23.920 --> 0:11:26.880 I don't screw it up too bad. Speaking yesterday, Tampa Bay, 0:11:26.920 --> 0:11:29.640 Shane McClanahan starts for the a L. There are six 0:11:29.720 --> 0:11:31.920 Yankees on the a L roster. Aaron Judge and John 0:11:31.960 --> 0:11:34.400 Carlos Stanton will start in the outfield that mets. Jeff 0:11:34.440 --> 0:11:37.160 McNeil is the n L starting second basement soccer in Mexico, 0:11:37.640 --> 0:11:41.880 US over Canada one nothing the Clintsos spot in the Olympics. 0:11:41.960 --> 0:11:44.800 John Stashiaward Bloomberg Sports Nathan, Thank you John. Right now, 0:11:44.880 --> 0:11:47.360 SMP futures are up thirty points, STUFF futures up two 0:11:47.640 --> 0:11:50.720 D one, NASAC futures higher by eighty six points ten. 0:11:50.800 --> 0:11:52.680 Your treasury is a little changed right now. The yield 0:11:52.679 --> 0:11:54.679 two point nine eight percent yield on the two year 0:11:54.800 --> 0:11:59.000 three point one six percent. More to come, including on 0:11:59.160 --> 0:12:03.440 Apple's high rings. Slow down with Bloomberg Tech columnist Alex Wab, 0:12:03.559 --> 0:12:08.960 This is Bloomberg Bloomberg eleven three oh weather sunny and 0:12:09.000 --> 0:12:12.000 hot today, tomorrow and the next day. We're getting into 0:12:12.000 --> 0:12:14.199 a heat wave here with highs into the low to 0:12:14.400 --> 0:12:22.559 mid nineties right now seventy three and second part Markets 0:12:22.640 --> 0:12:25.719 headlines and breaking news twenty four hours a day at 0:12:25.720 --> 0:12:29.119 Bloomberg dot Com, the Bloomberg Business app, and at Bloomberg 0:12:29.200 --> 0:12:38.280 Quick Take. This is a Bloomberg Business Flash and I'm 0:12:38.360 --> 0:12:42.760 Karen Moscow. Stocks are stabilizing as investors assess the outlook 0:12:42.760 --> 0:12:47.080 for global growth amid Europe's deepening energy crisis, hawkish central banks, 0:12:47.080 --> 0:12:49.760 and slumping earnings estimates that all are swalling against all 0:12:49.800 --> 0:12:53.080 the BITS group at ten piers. US stock index futures, meanwhile, 0:12:53.120 --> 0:12:55.040 are higher in the wake of another reversal for the 0:12:55.200 --> 0:12:58.560 SMP five hundred yesterday on Apple's plans to slow hiring. 0:12:58.640 --> 0:13:00.720 If you check the markets every fifth teen minutes throughout 0:13:00.720 --> 0:13:03.439 the trading day on Bloomberg Guess and p future is 0:13:03.480 --> 0:13:06.120 at thirty three points down. Futures have two hundred fourteen 0:13:06.520 --> 0:13:09.719 Nasdack features have ninety eight. The decks in Germany is 0:13:09.760 --> 0:13:12.199 it will change ten your treasury, that'll change yield two 0:13:12.240 --> 0:13:14.640 point nine eight percent. They yield on the two year 0:13:14.760 --> 0:13:17.599 three point one six percent. Nine x Screute oil is 0:13:17.600 --> 0:13:19.360 down a tenth of upper cent or twelve cents, and 0:13:19.400 --> 0:13:22.000 a hundred two dollars forty eight cents of barrel Comic 0:13:22.080 --> 0:13:24.160 School is up a tenth of upper cent or two dollars. 0:13:24.160 --> 0:13:27.520 At seventeen twelve, twenty announced the euro one point to 0:13:27.760 --> 0:13:30.319 five two against the dollar, British found one point two 0:13:30.400 --> 0:13:33.079 zero two one and the end month thirty seven point 0:13:33.120 --> 0:13:35.840 to five six Bitcoin is at one point eight percent 0:13:36.080 --> 0:13:38.880 at twenty one tho eight hundred seventy dollars. That's a 0:13:38.880 --> 0:13:41.640 Bloomberg business flush. Now here's John Tucker with more on 0:13:41.760 --> 0:13:44.840 moss going on around the world. John and Karen sent 0:13:44.880 --> 0:13:47.040 a Democrat searching the White House to the clear a 0:13:47.200 --> 0:13:51.600 climate emergency. The House committee investigating the January says attack 0:13:51.679 --> 0:13:53.960 on the Capitol, which had planned to finish its inquiry 0:13:54.040 --> 0:13:57.560 by September, will stead keep operating beyond that because more 0:13:57.600 --> 0:14:01.040 information keeps coming in at shun vowing to take a 0:14:01.120 --> 0:14:04.880 resolute and strong response to any Taiwan visit by House 0:14:04.880 --> 0:14:09.720 Speaker Nancy Pelosi. Sports the National superstar Juan Soto winning 0:14:09.760 --> 0:14:13.040 the home Run derby at the Baseball All Star Game. 0:14:13.600 --> 0:14:15.920 And we have global news twenty four hours a day 0:14:15.960 --> 0:14:18.280 on here. Get on Bloomberg Quick Say Power by more 0:14:18.280 --> 0:14:21.440 than seven hundred journalists and analysts and more than one 0:14:21.520 --> 0:14:25.600 hundred twenty countries. I'm John Tucker. This is Bloomberg. Nathan Alright, John, 0:14:25.600 --> 0:14:27.880 thank you to six nineteen on Wall Street Live from 0:14:27.920 --> 0:14:31.200 the Bloomberg Interactive Broker Studios. This is Bloomberg a daybreak. 0:14:31.280 --> 0:14:33.480 Let's get back to our top story this morning, the 0:14:33.560 --> 0:14:36.920 growing trend in the tech and financial sectors, with now 0:14:37.000 --> 0:14:41.880 Apple adding itself to it, slowing hiring and spending. Let's 0:14:41.880 --> 0:14:44.200 bring back Alex Web for more on this. Bloomberg Quick 0:14:44.240 --> 0:14:47.960 Take anchor tech columnist for Bloomberg Opinion, Alex. As you know, 0:14:48.040 --> 0:14:51.480 we saw tech stocks lead the declines yesterday on that 0:14:51.560 --> 0:14:54.480 news from Apple. What kind of slow down could we 0:14:54.680 --> 0:15:00.080 be looking at from the iphonemaker. Ultimately, this is the 0:15:00.120 --> 0:15:03.440 corollary of the inflationary environment that apples in the business 0:15:03.440 --> 0:15:08.480 of selling thousand dollars a pop electronic devices. As discretionary 0:15:08.520 --> 0:15:12.920 income gets increasingly squeezed, is easy to see how that 0:15:13.040 --> 0:15:15.560 might affect spending on Apple devices. Now we've seen the 0:15:15.600 --> 0:15:19.960 other tech companies cutting jobs, and that's largely been to 0:15:20.000 --> 0:15:23.440 do with the broader economic conditions, which mean that the 0:15:23.520 --> 0:15:26.400 first thing companies cut is their marketing spend. Apple is 0:15:26.440 --> 0:15:28.120 a little bit different. It is very much to do 0:15:28.200 --> 0:15:34.120 with direct consumer appetites for their products. Yeah, so this 0:15:34.240 --> 0:15:36.520 is a raising the question in the market once again 0:15:36.560 --> 0:15:40.520 about not just the inflationary pressures ALEX, but whether we 0:15:40.560 --> 0:15:43.360 could potentially be heading into a recession here if we 0:15:43.440 --> 0:15:47.240 do start to see more of those consumers who have 0:15:47.400 --> 0:15:50.880 come to rely on iPhones and other products from Apple 0:15:51.080 --> 0:15:55.800 not necessarily to upgrade as they're getting squeezed. Even further, 0:15:56.880 --> 0:15:59.920 we've seen over the past five six years a gradual 0:16:00.000 --> 0:16:03.680 all um increase in the amount of time that keep 0:16:03.760 --> 0:16:07.520 people keep their phones. Maybe five years ago it was 0:16:07.560 --> 0:16:09.880 only every sort of two years or so that people 0:16:09.880 --> 0:16:12.880 would upgrade to the to the latest hand set. That's 0:16:12.920 --> 0:16:16.000 now extended to three years, and the jet sensor, the 0:16:16.040 --> 0:16:19.320 general direction of travel is going further than that. Now. 0:16:19.520 --> 0:16:24.239 Apple has managed to diversify its revenue quite substantially into services, 0:16:24.280 --> 0:16:27.320 you know, things like Apple TV plus, Apple Music, Fitness 0:16:27.320 --> 0:16:30.640 plus all these things where it gets more dependable income 0:16:30.720 --> 0:16:33.440 over longer period of time, and the other huge benefit 0:16:33.440 --> 0:16:36.080 of that is it ties consumers more keenly to their 0:16:36.080 --> 0:16:40.160 Apple devices. So there is still expectation that people will upgrade. 0:16:40.160 --> 0:16:43.880 The risk of them churning into trading their iPhones for 0:16:43.920 --> 0:16:47.800 Android devices isn't necessarily any greater right now, but it's 0:16:47.840 --> 0:16:50.320 just generally that people maybe aren't going to be spending 0:16:50.320 --> 0:16:52.960 as much on electronic devices as a whole. So it's 0:16:53.000 --> 0:16:55.320 the thinking then that as Apple starts to think about 0:16:55.360 --> 0:16:57.920 what it's doing in terms of it's spending, that it's 0:16:57.960 --> 0:17:01.920 going to make another pivot one again from services or 0:17:02.000 --> 0:17:06.280 from goods to services as part of its overall strategy 0:17:06.760 --> 0:17:10.000 that has been going at at at a real clip anyway. Um, 0:17:10.119 --> 0:17:14.320 they it's they're trying. Several years ago the revenue came 0:17:14.320 --> 0:17:16.800 from the iPhone. Now it's less than six so they 0:17:16.840 --> 0:17:21.520 have succeeded in doing that quite well. The other point 0:17:21.560 --> 0:17:23.120 that you can make here is, look, they are not 0:17:23.720 --> 0:17:27.520 freezing all spending. They are slowing spending in some divisions 0:17:27.560 --> 0:17:31.000 and slowing headcount um slowing hiring in some divisions. And 0:17:31.359 --> 0:17:33.320 you could also look at it as a way of 0:17:34.240 --> 0:17:37.639 sometimes companies use um these sort of economic environments as 0:17:37.640 --> 0:17:40.480 a cover as an excuse, there's a reason to go. Actually, 0:17:40.800 --> 0:17:42.840 let's just rain things in a little bit. We've maybe 0:17:42.840 --> 0:17:44.560 got a little bit out of control over the past 0:17:44.600 --> 0:17:46.199 few years. I'm not saying that Apple has got out 0:17:46.200 --> 0:17:50.119 of control, but it is a good opportunity just to recalibrate, retrench, 0:17:50.600 --> 0:17:53.359 and not get the sort of massive blowback from your 0:17:53.359 --> 0:17:55.600 employees that might otherwise be the case. With this in 0:17:55.680 --> 0:17:58.600 the context alex of what we've seen from other companies 0:17:58.600 --> 0:18:01.560 as they've been announcing slow downs in hiring and spending 0:18:01.600 --> 0:18:05.000 as well, particularly Netflix, is that getting ready to report 0:18:05.040 --> 0:18:08.560 earnings after the closing bell today. When you think about 0:18:08.560 --> 0:18:10.800 any of these companies, you look at the lifetime value 0:18:10.800 --> 0:18:13.560 of your customers. And for Netflix, there had been an 0:18:13.560 --> 0:18:18.760 expectation in growing perception that it was really a utility 0:18:18.920 --> 0:18:22.120 that if anybody was interested in watching, you know, sort 0:18:22.160 --> 0:18:25.600 of televisual content, they would have Netflix and that was 0:18:25.640 --> 0:18:28.399 the base layer upon which you would then add other 0:18:28.640 --> 0:18:31.199 streaming services if you so desired. What we started to 0:18:31.600 --> 0:18:34.720 see is that's not necessarily the case. It is losing subscribers. 0:18:35.240 --> 0:18:37.480 Um is. The expectation is that it loses two million 0:18:37.520 --> 0:18:41.360 subscribers globally the only region which will add subscribers is Asia. 0:18:41.640 --> 0:18:44.600 The inference of that, which is that's about one percent 0:18:44.600 --> 0:18:46.920 of their total subscribe account. But the inference is then 0:18:46.960 --> 0:18:50.240 that like maybe Netflix is discretionary spending, it is not 0:18:50.320 --> 0:18:52.840 a utility. And so you know, there's a function of 0:18:52.880 --> 0:18:55.960 the greater competition in that space, but which in turn 0:18:56.000 --> 0:18:58.399 then means that Netflix is content. Perhaps isn't as appealing 0:18:58.440 --> 0:19:01.240 as people thought it was once. Yeah, interesting to think 0:19:01.240 --> 0:19:05.720 about the competition growing for Netflix, including from Apple TV 0:19:05.840 --> 0:19:09.119 Plus as they're dominating the news this morning with the 0:19:09.160 --> 0:19:12.879 reports of a hiring and spending slowdown over at Apple. 0:19:12.960 --> 0:19:15.240 Thanks for this, Alex, as always great having on with us. 0:19:15.280 --> 0:19:19.240 Alex web Bloomberg Opinion, tech columnist and anchor at Bloomberg 0:19:19.320 --> 0:19:22.600 Quick Take course. You can check Alex out anytime Bloomberg 0:19:22.680 --> 0:19:26.879 dot Com, Slash quick Take Right now, SMP futures up 0:19:26.880 --> 0:19:29.480 thirty two points down, futures up two hundred five NASDAC 0:19:29.520 --> 0:19:33.159 futures higher by ninety seven points. The tenure Treasury right 0:19:33.160 --> 0:19:35.480 now little changed for a yield of two point nine 0:19:35.560 --> 0:19:38.600 eight percent. Yield on the two year right now three 0:19:38.680 --> 0:19:42.200 point one six percent. NIMEX crude moving a bit lower 0:19:42.200 --> 0:19:44.320 down a half percent, or of fifty six cents to 0:19:44.400 --> 0:19:47.919 a hundred two dollars four cents a barrel. Just to 0:19:47.960 --> 0:19:52.200 add more on Apple's hiring and spending slow down and 0:19:52.800 --> 0:19:55.840 even higher interest rate hikes coming from the e c 0:19:56.000 --> 0:19:57.960 B this week. We'll tell you more about that as 0:19:58.000 --> 0:19:59.639 we get the five things you need to know to 0:19:59.680 --> 0:20:08.119 start or day. Just ahead on Bloomberg Daybreak Bloomberg eleven 0:20:08.160 --> 0:20:11.399 three oh weather sunny and hot, low nineties today, mid 0:20:11.480 --> 0:20:15.840 nineties tomorrow, mid nineties Thursday, with a chance for afternoon 0:20:15.920 --> 0:20:18.679 showers and storms by then. Right now seventy three in 0:20:18.720 --> 0:20:25.840 Central Park, broadcasting live from the Bloomberg Interactive Broker Studio 0:20:25.960 --> 0:20:29.119 in New York, Bloomberg E Living Freedom to Washington, d C, 0:20:29.320 --> 0:20:33.040 Bloomberg N one to Boston, Bloomberg one O six one 0:20:33.119 --> 0:20:36.600 to San Francisco, Bloomberg NOME sixty to the Country, Sirius 0:20:36.760 --> 0:20:39.919 XM Chado one nineteen and around the globe, the Bloomberg 0:20:39.960 --> 0:20:45.280 Business at and Bloomberg Radio dot Com. This is Bloomberg Daybreak. 0:20:50.119 --> 0:20:52.359 It's six thirty on Wall Street. Good morning. I'm Nathan 0:20:52.400 --> 0:20:55.280 Hagar and I'm Karen Moscow. We are just about three 0:20:55.320 --> 0:20:57.560 hours away from the open of US training time for 0:20:57.600 --> 0:20:59.680 the five things you need to notice. Start your day 0:20:59.680 --> 0:21:02.800 broth to you by Interactive broker Simple ib k are 0:21:02.880 --> 0:21:06.040 Global Trader app. Deposit in your local currency and trade 0:21:06.040 --> 0:21:08.520 stock in the US, Europe and Asia. Start your free 0:21:08.520 --> 0:21:12.520 trial at ibk r dot com slash Global Trader. First, 0:21:12.560 --> 0:21:14.639 you begin with the growing number of companies putting a 0:21:14.680 --> 0:21:17.119 clamp down on hiring. It's a trend of showing up 0:21:17.119 --> 0:21:19.840 in firms from tech to banking. They get the latest 0:21:19.880 --> 0:21:23.440 live from Bloomberg's Ranita Young, Good Morning Radia, Good Morning Karen. 0:21:23.560 --> 0:21:26.679 Apple is joining its fellow tech giants and putting a 0:21:26.800 --> 0:21:30.480 lid on hiring. Bloomberg sources say Apple wants to limit 0:21:30.560 --> 0:21:33.480 spending and job growth at some of its divisions, although 0:21:33.560 --> 0:21:37.760 leaders have not adopted a companywide policy. This more cautious 0:21:37.800 --> 0:21:43.040 approach mimics moves by Amazon and Microsoft. Meantime, Goldman Sex 0:21:43.160 --> 0:21:46.880 also plans to slow hiring to reign in expenses. CFO 0:21:46.960 --> 0:21:50.679 Dennis Coleman says Goldman could also produce or reduce the 0:21:50.720 --> 0:21:54.680 pace of replacing staff it loses because of attrition, and 0:21:54.800 --> 0:21:58.920 will reinstate annual performance reviews Live in New York. I'm 0:21:58.960 --> 0:22:02.000 Rennita Young Bloomber Daybreak. We need to thanks sticking with tech. 0:22:02.040 --> 0:22:04.760 The war of words continues between Twitter and Elon Musk. 0:22:04.800 --> 0:22:07.760 The company's calling Musk complaints about spam and robot accounts 0:22:07.760 --> 0:22:10.680 and irrelevant side show. Twitter wants a trial soon over 0:22:10.760 --> 0:22:14.320 must cancelation of his takeover Nathan and crypto markets. This morning, 0:22:14.320 --> 0:22:18.280 Bitcoin is continuing its rise, nearly touching twenty three thousand. 0:22:18.320 --> 0:22:21.879 Shila Warren, Crypto Innovation Council CEO, has more on the 0:22:21.960 --> 0:22:24.160 recent rally. You know that we're waiting for a calamity. 0:22:24.160 --> 0:22:25.719 I find that a bit dramatic. I mean, I think 0:22:25.760 --> 0:22:28.400