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Speaker 1: This is Bloomberg day Break Asia for his Tuesday June

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Speaker 1: thirteenth in Hong Kong, Monday June twelfth in New York

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Speaker 1: and coming up today.

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Speaker 2: Markets are way key US inflation data in front of

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Speaker 2: the Fed's next decision.

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Speaker 1: Google and Microsoft face new competition issues, and.

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Speaker 2: Oracle's cloud business benefits from AI demand.

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Speaker 3: Miami Max's upsecurity for Trump surrender tomorrow. China deny spy

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Speaker 3: base in Cuba, US blames Trump administration for not stopping it.

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Speaker 3: New York Police commissioner to resign. I'm at Baxter with

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Speaker 3: Global News.

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Speaker 4: That's all straight ahead on Bloomberg Daybreak Asia, the business

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Speaker 4: news you need to start your day in just one

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Speaker 4: fifteen minute podcast available on Apples, Spotify, the Bloomberg Business App,

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Speaker 4: and everywhere you get your podcasts.

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Speaker 1: Good morning, I'm deg Prisner and I'm Brian Curtiz. Here

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Speaker 1: are the stories we're following today. FED officials with their

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Speaker 1: eye on the key inflation data tomorrow in the United

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Speaker 1: States and that meeting of course.

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Speaker 5: This week will get the CPI.

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Speaker 1: Dated at eight thirty in the morning, Wall Street Time,

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Speaker 1: Bloomberg's Michael McKee has a preview.

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Speaker 6: Economists say consumer price inflation slowed in May, led lower

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Speaker 6: by falling energy and automobile prices. This inflation in rent

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Speaker 6: may finally show up, holding down the core rate. Meanwhile,

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Speaker 6: base effects high inflation a year ago mean a big

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Speaker 6: drop in overall inflation this year. At least that's the forecast.

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Speaker 6: If analysts are wrong, however, watch out higher than anticipated

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Speaker 6: inflation will change expectations for the FED policy decision due Wednesday,

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Speaker 6: with officials divided over whether to raise rates or make

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Speaker 6: no change. An inflation surprise would lead to big market moves.

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Speaker 6: Michael McKee, Bloomberg Daybreak Asia.

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Speaker 2: After the bell, we heard from Oracle. The company reported

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Speaker 2: fourth quarter sales rising seventeen percent. So we have a

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Speaker 2: top line of thirteen point eight billion dollars that is

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Speaker 2: one hundred million above estimates. Revenue growth was led by

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Speaker 2: oracles cloud applications and infrastructure businesses, and a boom in

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Speaker 2: generative AI may be boosting demand for its cloud technology

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Speaker 2: going forward. Here is Bloomberg's anarog runner.

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Speaker 7: AI workloads require a lot of power, a lot of

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Speaker 7: You could say, you know the engine and storage to

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Speaker 7: run those, and you really can't do that. I mean,

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Speaker 7: I would say only a handful of companies around the

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Speaker 7: world would be able to do this internally in their

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Speaker 7: own data center, so you really need a public cloud

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Speaker 7: to run that. So, whether that's you know, Microsoft, Amazon, Google,

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Speaker 7: and now most recently Oracle, which is really making strides

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Speaker 7: with their cloud product, I think all of these companies

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Speaker 7: will benefit as people develop more AI application.

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Speaker 2: That is Bloomberg's anerog Ruana Now. So far this year,

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Speaker 2: shares an Oracle are up more than forty two percent

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Speaker 2: stock right now in late US trading, Hire by three

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Speaker 2: point four percent ran Well.

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Speaker 1: The Federal Trade Commission has sued Microsoft in federal core.

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Speaker 1: This was in an effort to block Microsoft's big acquisition

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Speaker 1: sixty nine billion dollar acquisition of Activision Blizzard.

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Speaker 5: Bloomberg's and Kate says the story.

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Speaker 8: The FTC wants a transaction put on hold until the

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Speaker 8: agency's in house court has a chance to rule on

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Speaker 8: the deal, with that trial schedule to begin in August.

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Speaker 8: The Microsoft Activision combination faces tough antitrust scrutiny in the US,

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Speaker 8: and the UK ruled against the takeover in April, determining

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Speaker 8: that titles like Activision's Call of Duty would bolster Microsoft's

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Speaker 8: edge over rivals in the small but growing cloud gaming market.

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Speaker 8: Microsoft is appealing that decision, which is globally binding in

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Speaker 8: Washington and Kate's Bloomberg day Break Asia.

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Speaker 2: Meantime, Google is set to be hit with another round

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Speaker 2: of antitrust charges by officials in Europe. That story from

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Speaker 2: Bloomberg's tom Busby.

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Speaker 9: Google, already facing more than eight billion euros and fines

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Speaker 9: by officials in the European Union, may soon be facing

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Speaker 9: billions more. As early as Wednesday, a so called statement

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Speaker 9: of objections expected to be filed by officials there, targeting

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Speaker 9: Google's biggest money maker, its digital advertising unit. The new

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Speaker 9: charges from the European Commission, the EU's anti trust watchdogs,

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Speaker 9: takes aim at the alphabet unit's ad tech business model,

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Speaker 9: which collects user data which then allows advertisers to target

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Speaker 9: specific ads and to sell adspace and technology directly to advertisers.

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Speaker 9: Google has not responded to the Bloomberg's request for comment

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Speaker 9: tom buzzby Bloomberg Daybreak Asia.

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Speaker 1: Google did trade higher in the session today, up on

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Speaker 1: one point two percent, but that was slight underperformance than

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Speaker 1: Asdek itself put on one.

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Speaker 5: And a half percent.

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Speaker 1: Well in upcoming testimony, US Treasury Secretary Janet Yellen will

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Speaker 1: cast the IMF and the World Bank as important counterweights

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Speaker 1: to China.

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Speaker 5: Bloomberg's Joan Wong has that from.

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Speaker 10: Hong Kong, Yellen will tell the House Financial Services Committee

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Speaker 10: the International Monetary Fund and the World Bank reflect American

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Speaker 10: values and that they can counter China's influence in the

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Speaker 10: developing world. And the prepared remarks, Yellen says the institutions

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Speaker 10: provide real resources to counter non transparent, unsustainable lending. Yellen

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Speaker 10: will be looking to garner congressional support for US financial

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Speaker 10: b acting also slenders, but she's likely to be countered

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Speaker 10: by Republicans and the back and forth. Later today, our

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Speaker 10: time could get testy and Hong Kong. I'm joined Walt

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Speaker 10: Bloomberg day Brogasia.

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Speaker 1: I'm Brian Curtis along with Doug Christners. So Dog, we

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Speaker 1: hit the balance scale out this week to weigh up

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Speaker 1: inflation versus recession, at least from the Fed's point of view.

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Speaker 1: And you know which one weighs on the economy more.

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Speaker 1: Which is the bigger concern most likely? I would guess

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Speaker 1: it's inflation, and we'll get the information on Now we'll

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Speaker 1: get the dot plot the commentary by Jerown Powell, The

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Speaker 1: Fan of the Grateful Dead.

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Speaker 2: You know, David Kelly, the chief global strategist over at

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Speaker 2: JP Morgan Asset Management, was putting his finger exactly on

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Speaker 2: that issue, the FED having to weigh progress on fighting

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Speaker 2: inflation against the risk of recession. Now Kelly feels that

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Speaker 2: the numbers that we will see going forward here will

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Speaker 2: not support any further tightening. And if he is right,

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Speaker 2: he is saying now that the investment environment in which

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Speaker 2: we find ourselves could support lower long term interest rates,

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Speaker 2: a lower dollar, and further gains and equity prices.

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Speaker 1: We keep thinking that we'll add an inflection point and

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Speaker 1: that you know, we'll get information I We've got the

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Speaker 1: CPI and the FED this week, and that you know

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Speaker 1: that will really tell the story, and then you know,

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Speaker 1: nothing really changes all that much.

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Speaker 5: We just keep grinding higher.

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Speaker 1: I thought it was interesting that you had the big

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Speaker 1: strategist from the biggest institutions all out on the same

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Speaker 1: day today Goldman Sachs David Costin says he thinks the

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Speaker 1: gains will continue because some of the other sectors besides

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Speaker 1: tech will catch up. Morgan Stanley's Michael Wilson harkened back

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Speaker 1: to the nineteen forties when the S and P five

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Speaker 1: hundred rallied twenty four percent before then returning to a

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Speaker 1: new low. And you also had Marko Kolanovitch over at

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Speaker 1: JP Morgan saying this is going to fall apart. The

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Speaker 1: move higher in cyclical stocks is likely to prove fleeting,

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Speaker 1: as many of the same arguments, the lag effect of

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Speaker 1: the of the interest rate hikes and the fact that

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Speaker 1: we've had so many already that that will threaten the economy.

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Speaker 2: And speaking of stocks that are particularly sensitive to the economy,

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Speaker 2: look at energy today. Now we had the Goldman call

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Speaker 2: we were talking about this yesterday on the program, with

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Speaker 2: the cut in the forecast for Brent crude now about

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Speaker 2: to eighty six bucks by December. By the way, this

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Speaker 2: is the third time in the last six months that

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Speaker 2: Goldman has revised lower its forecast for oil. Today in

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Speaker 2: New York. This is not Brent, this is WTI. We

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Speaker 2: were down nearly four and a half percent. We closed

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Speaker 2: around sixty seven to twelve, and that took with it

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Speaker 2: that lower oil price took a lot of the energy

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Speaker 2: stocks down as well.

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Speaker 1: And energy really hasn't rallied. I mean it's just kind

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Speaker 1: of missed out on this bowl. It's one of the

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Speaker 1: most underweight sectors. If you avoid recession, is that an

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Speaker 1: area where you can play catchup. We'll have to wait

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Speaker 1: and see.

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Speaker 5: Lot is still out there. It's time now for Global News.

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Speaker 1: Miami says it's ready to handle crowd control as Donald

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Speaker 1: Trump surrenders to police tomorrow. At back to with Global

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Speaker 1: News from the nine to sixty news room in San Francisco.

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Speaker 3: Ed, Yeah, right, Brian, they say they're ready. Authorities are

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Speaker 3: downplaying any threats as well. Polite trief Manny Morales says

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Speaker 3: no perceived crisis coming.

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Speaker 11: There has been a lot of post none that I'm

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Speaker 11: aware that can cause any concern of any type of credibility.

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Speaker 11: But make no mistake about it, we're taking this event

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Speaker 11: extremely serious. We know that there is a potential of

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Speaker 11: things taking a turn for the worst, but that's not

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Speaker 11: the Miami Way.

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Speaker 3: And Mayor Francis Suarez says, Carrot and Stick.

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Speaker 12: Obviously believe in the constitution, believe that people should have

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Speaker 12: the right to express themselves.

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Speaker 5: But we also believe in law.

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Speaker 11: And order, and we know that and we hope that tomorrow.

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Speaker 4: Will be peaceful.

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Speaker 3: Yeah, Meanwhile, reports are Donald Trump boarded his private jet

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Speaker 3: for Florida earlier today alone now tomorrow, after the arrangement,

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Speaker 3: Bloomberg's Nancy Cook says, Trump goes back to Bedminster for

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Speaker 3: a rally.

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Speaker 12: What he's going to do around eight to fifteen at

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Speaker 12: night is give remarks. I'm expecting those remarks to be

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Speaker 12: shorter than the remarks he gave after his first indictment

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Speaker 12: when the Manhattan DA indicted him. And then he's going

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Speaker 12: to have a fundraiser at Bedminster. They're hoping to raise

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Speaker 12: two million dollars, and his.

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Speaker 3: Legal team will be working on other potential indictments that

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Speaker 3: could be coming down the pike. China today denying US

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Speaker 3: claims that it is has spy operations in Cuba, Chinese

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Speaker 3: Foreign Ministry sportsmen of Long Win Being saying that it

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Speaker 3: is false information. Says over the past few days he's

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Speaker 3: seen inconsistent information coming from the US. Now he is

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Speaker 3: right on the last point. The US has denied the

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Speaker 3: Wall Street Journal report last week and yesterday admitted there

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Speaker 3: were bases in Today, the US behind National Security Council

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Speaker 3: Coordinator John Kirby went on the verbal offensive.

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Speaker 5: This is not a new development.

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Speaker 1: That China has been trying to achieve some intelligence gathering

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Speaker 1: capabilities in Cuba and frankly elsewhere in hemisphere.

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Speaker 3: And defends the administration's reticence to talk about it, saying

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Speaker 3: it does no good publicly and causes harm to talk

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Speaker 3: about these kinds of sensitive matters in public. Meanwhile, Secretary

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Speaker 3: of St. Anthony Blinkin today says the Trump administration did

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Speaker 3: not do enough to counter the Chinese efforts to boost

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Speaker 3: intelligence gathering overseas after discovering that Beijing was operating in

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Speaker 3: Cuba in twenty nineteen. And Blinka also says that China

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Speaker 3: is not directly giving military aid to Russia at this point.

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Speaker 5: Today, we've not seen.

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Speaker 4: That line acrossed.

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Speaker 5: At the same time, we have concerns about private.

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Speaker 3: Companies, but says it is being closely monitored. Pennsylvania's governor

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Speaker 3: has declared disaster in Philadelphia after the collapse seven of

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Speaker 3: an I nine five overpass caused by a tanker fire,

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Speaker 3: and the Transportation Secretary Pete Budachich there today says it

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Speaker 3: has wide ranging effects.

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Speaker 6: This is not just about commutes, This is also about

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Speaker 6: supply chains. About one hundred and fifty thousand vehicles a

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Speaker 6: day and a good percentage of at its truckings.

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Speaker 3: And says all the way from Philadelphia up through New York,

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Speaker 3: but also south to Washington, DC supply lines. New York

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Speaker 3: City Police Commissioner Keyshaw Sewell is going to resign. There

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Speaker 3: had been talked for the past several days that she

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Speaker 3: had lost power and was having to clear all policy

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Speaker 3: moves through Mayor Eric Adams office. She has sent out

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Speaker 3: an email to her staff. Global News powered by more

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Speaker 3: than twenty seven hundred journalists and analysts in over one

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Speaker 3: hundred and twenty countries in San Francisco. I'm Ed Baxter.

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Speaker 3: This is Bloomberg.

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Speaker 1: I'm Brian Curtis, along with Rashad Salamat and our guest

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Speaker 1: is Lamar vieer portfolio manager with Vier and Company, to

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Speaker 1: take a look at markets. Lamar, thank you for joining us.

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Speaker 1: Does it feel like people are chasing here a little bit?

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Speaker 13: Certainly in some sectors. I mean, we think what's the

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Speaker 13: rebound in big tech has probably gone a little too far,

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Speaker 13: a little too fast. But you know, we still think

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Speaker 13: there are some pockets where you can get some quality

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Speaker 13: a reasonable prices. So you got to got to kind

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Speaker 13: of be picky and choosy as you look at the

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Speaker 13: opportunities out there.

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Speaker 14: Absolutely, but you've got to be abso to be a

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Speaker 14: cognizant of us some which are cheap for a reason.

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Speaker 13: Correct, that's right. No, we we definitely don't think you

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Speaker 13: want to be buying into value traps, but there are

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Speaker 13: you know, like I said, it's it's when you get

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Speaker 13: the big tech to megacap guys, they've they've really just

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Speaker 13: the pendulum has swung right back to what we would

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Speaker 13: argue is a little overheated. There's a lot of folks

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Speaker 13: that will just buy those, or even just buy an

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Speaker 13: index fund and not realize that they're buying a really

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Speaker 13: a tech dominated fund and and really piling into some

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Speaker 13: of the richer evaluations out there.

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Speaker 1: I mentioned the comment from Marko Kolonovich at JP Morgan

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Speaker 1: about cyclical stocks that ultimately the gains will be fleeting,

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Speaker 1: and that the lag effect of the of the rate

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Speaker 1: hikes that we've already seen and the fact that we

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Speaker 1: may see more. I mean, there's no, there's no notion.

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Speaker 1: I don't think at the moment that we're stopping here

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Speaker 1: pausing maybe, but do you agree with that or do

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Speaker 1: you think that there is room for you know, there

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Speaker 1: to be more bread than the market.

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Speaker 13: I think I'm more in team Goldman, I guess than

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Speaker 13: team JP.

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Speaker 1: Morgan is okay, so you're a little positive then, yeah, exactly.

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Speaker 13: We think, you know, there's there's some room the rest

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Speaker 13: of this year, and we're actually, uh, we we think

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Speaker 13: there's still some good opportunities, specifically in the consumer sector.

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Speaker 13: So we think the consumer from everything we're saying, you've

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Speaker 13: got Wall Street on the one hand, terrified that the

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Speaker 13: consumer is getting ready to fall apart, but every single

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Speaker 13: bit of data we've seen has really been positive. So

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Speaker 13: you know, the Fed obviously has done some tightening. It

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Speaker 13: looks like they're not going to do anything, uh you know,

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Speaker 13: on Wednesday. But you know, we think that the consumer

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Speaker 13: is strong and and you know, with with most of

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Speaker 13: the data points that we're looking at, we think there's

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Speaker 13: there's still some room to run and some decent opportunities.

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Speaker 14: And here I mean yes, if you look at the

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Speaker 14: top ten industry groups on the S and P five hundred,

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Speaker 14: consumer cyclicals and consumer staples and even discretionary and not

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Speaker 14: amongst them, does that surprise you?

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Speaker 13: It does? But you know it's tough the way we

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Speaker 13: categorize sectors we find to be less and less relevant.

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Speaker 13: So you know, calling Apple a tech stock is fine,

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Speaker 13: but it's arguably just as much or more of a

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Speaker 13: consumer stock, So it becomes very arbitrary, especially like we

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Speaker 13: said with big Tech. You know, is Netflix really a

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Speaker 13: technology stock? I would argue it's more driven by consumer

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Speaker 13: trends than what's going on in technology. So I think

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Speaker 13: the consumer sector is a lot bigger than we're given a.

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Speaker 1: Credit if we do manage to avoid recession. You probably

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Speaker 1: heard me mention with Doug a few moments ago that

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Speaker 1: energy could prove an interesting bet in that it's underperformed.

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Speaker 5: Do you see it that way?

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Speaker 13: We're actually not very bold on energy, and partially that's

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Speaker 13: because you know, the global supply is pretty high relative

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Speaker 13: to the demand. But but more importantly, you know, we

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Speaker 13: we kind of tend to shy away from energy just

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Speaker 13: because it's it is so difficult to predict what's going

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Speaker 13: going with the prices of oil and gas, and it's

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Speaker 13: we we think you're much better suited or much better

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Speaker 13: off picking the things that are a little more predictable

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Speaker 13: and where you can feel a little more comfortable in

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Speaker 13: your in your bats is about.

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Speaker 14: You know, okay, that's energy. But on the other side

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Speaker 14: of energies, of course, the decombonization. How does that inform

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Speaker 14: some of your investment decisions.

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Speaker 13: Well, that that is definitely part of it. As you

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Speaker 13: look at you know, the rise of the electric vehicles

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Speaker 13: and so forth. There's there's certainly going to be a

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Speaker 13: lot of pressure on demand down the road. Now, I

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Speaker 13: think it's still going to be a while before that

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Speaker 13: really has a meaningful impact, but it's being excited about

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Speaker 13: the long term prospects. Yeah, it's a little cloudy.

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