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Speaker 1: Good morning. I'm Brian Curtis and I'm Doug Krisner. Here

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Speaker 1: are the stories we're following today.

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Speaker 2: US consumer confidence rising in December by the most since

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Speaker 2: early twenty twenty one. The Conference Boards Index increased to

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Speaker 2: one ten point seven from a revised reading of one

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Speaker 2: oh one in November. It comes as Americans grow more

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Speaker 2: upbeat about the economy and the labor market, But the

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Speaker 2: Conference Board's chief economist, Dana Peterson says there are still

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Speaker 2: some concerns.

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Speaker 3: We actually ask consumers for right ends, and the write

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Speaker 3: ends still continue to complain about inflation, both food and energy.

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Speaker 3: Their concerns about politics were a little less intense, but

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Speaker 3: they are concerned about interest rates. But interestingly, in December,

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Speaker 3: the number thinking that interest rates were going to continue

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Speaker 3: to rise of the next year actually lessen. So it's

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Speaker 3: still inflation. I still think that's the big story for consumers.

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Speaker 2: Dana Peterson, and more on that, the Conference boards outlook

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Speaker 2: for high prices did improve. I expected inflation a year

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Speaker 2: out fell to the lowest level since late twenty twenty.

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Speaker 1: Now look at the latest FED speak we heard today

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Speaker 1: from the head of the Philly Fed, Pat Harker, and

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Speaker 1: he was saying the FED should begin to cut rates,

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Speaker 1: although not immediately now. Compared to other recent FED speakers,

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Speaker 1: Harker's comments were more supportive of a rate cut in

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Speaker 1: early twenty four You know, markets have been betting on

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Speaker 1: the FED beginning to ease in March. Now. Harker will

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Speaker 1: not vote on policy next year, even so, he will

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Speaker 1: be a part of discussions during the next FOMC meetings.

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Speaker 1: Harker did not specify when it would be appropriate for

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Speaker 1: the FED to begin cutting rates or how many rate

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Speaker 1: cuts he sees in the new year.

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Speaker 2: Brian Well Micron Technology says the second quarter revenue will

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Speaker 2: be five point one to five point five billion dollars,

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Speaker 2: and that whole range was higher than analyst estimates of

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Speaker 2: four point nine to nine billion. Micron is the largest

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Speaker 2: US maker of memory semiconductors. We gain reaction here from

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Speaker 2: Dan Morgan at Snovi's Trust.

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Speaker 4: It reiterated to give further evidence that the rebound that

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Speaker 4: began in the really the February of twenty twenty three

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Speaker 4: in the chip industry is definitely gaining momentum. We're starting

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Speaker 4: to see that in the memory space.

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Speaker 2: Stan Morgan, the boom in artificial intelligence spending is also helping.

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Speaker 2: CEO Sanjay Morotra said that there is strong demand for

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Speaker 2: the expensive memory used in data centers to help develop

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Speaker 2: AI software and just kve having a look at micro

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Speaker 2: and Technology stock and how it's trading in after hours

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Speaker 2: at the moment of four point three percent.

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Speaker 1: Warner Brothers Discovery has held merger talks with Paramount Global.

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Speaker 1: We are hearing these discussions are preliminary and they may

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Speaker 1: not lead to an agreement. Earlier, Axios had reported Warner

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Speaker 1: Brothers Discovery CEO David Zaslov had met with the head

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Speaker 1: of Paramount Global, Bob Bkish here in New York. That

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Speaker 1: happened sometime today. Bloomberg's Paul Sweeney breaks down the why

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Speaker 1: behind a possible deal between these two media companies.

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Speaker 5: The logic behind a lot of these media executives today

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Speaker 5: is I can't get too big here. There's not a

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Speaker 5: scenario where I don't need more scale because again, my

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Speaker 5: competitors are Netflix and some of the big technology companies.

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Speaker 5: Disney's probably in a good spot there, that's what most

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Speaker 5: people feel like, but everybody else has to really think

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Speaker 5: about what to do. And David Zaslov is a deal.

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Speaker 1: Maker that is Bloomberg's Paul Sweeney Now. A combination of

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Speaker 1: Warner Brothers Discovery and Paramount Global would unite famous Hollywood properties,

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Speaker 1: including the Paramount and Warner Brothers Film and TV studios.

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Speaker 1: It would also put a number of pay TV and

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Speaker 1: broadcast stations such as HBO and CBS under a single roof,

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Speaker 1: and a merger would likely face intense scrutiny by federal regulators,

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Speaker 1: who have challenged numerous combinations under the Biden administration.

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Speaker 2: Ran Well City Group has decided to exit the distress

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Speaker 2: debt trading business that story from Bloomberg's Charlie Pillett.

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Speaker 6: It is part of its latest retrenchment in City Group's

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Speaker 6: effort to reshape the firm in pursuit of higher returns.

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Speaker 6: According to people briefed on the decision, the move comes

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Speaker 6: host City Group undergoes a strategic overhaul under CEO Jane Frasier.

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Speaker 6: The decision to exit the business will remove one of

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Speaker 6: the key players in distressed debt markets and follows a

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Speaker 6: recent decision by the bank to also get out of

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Speaker 6: municipal bond trading and underwriting in New York. Charlie Pellet

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Speaker 6: Bloomberg Radio Well Sales at.

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Speaker 1: China's Byte danc are said to have passed one hundred

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Speaker 1: and ten billion dollars this year. We have more from

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Speaker 1: Bloomberg's for Shad Salamat in Hong Kong.

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Speaker 7: So to say by Dance has matched the thirty percent

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Speaker 7: growth it managed in twenty twenty two. That's when the

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Speaker 7: company reported sales in excessive eighty billion dollars. Total sales

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Speaker 7: this year would potentially be greater than its rival ten Cent,

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Speaker 7: and that's despite economic turbulence in China and elevated scrutiny

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Speaker 7: in key markets such as the US and India. It's

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Speaker 7: unclear how Bydowance performed in profitability this year, as internal

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Speaker 7: numbers have not been independently who did it, but this

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Speaker 7: year's scales that just bite downs has become one of

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Speaker 7: China's largest corporations by revenue in Hong Kong. I'm rashon

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Speaker 7: Salamic Bloomberg Radio.

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Speaker 2: All right, now it's time for Global news. The US

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Speaker 2: and Venezuela completing a major prisoner swap. A batch to

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Speaker 2: with that story in the nine to sixty news moment

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Speaker 2: in San Francisco.

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Speaker 8: It yeah, Brian right to us the Senate, close ally

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Speaker 8: of President Nicholas Madura in exchange for the lease of

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Speaker 8: ten Americans that have been a prisoner and prison as

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Speaker 8: well as the extradition of defense contractor known as Fat Leonard,

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Speaker 8: who is at the center of a massive Pentagon bribery

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Speaker 8: scandal as well. President Biden says political promises.

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Speaker 9: We've laid down specific requirements for a democratic collection.

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Speaker 6: He's agreed all.

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Speaker 8: Biden also asked today about the Colorado Supreme Court ruling

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Speaker 8: taking Donald Trump off the ballot. There asked whether Trump

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Speaker 8: was an insurrectionist he saw it.

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Speaker 1: On on whether the fourteenth gun of the five I want

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Speaker 1: to coordinate that decision.

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Speaker 6: But he's certainly supportinate the insurrection, no question about it.

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Speaker 9: No there.

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Speaker 8: So Trump's future now rests with the US Supreme Court.

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Speaker 8: He shaped in the Colorado case, and he today as

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Speaker 8: well said the Supreme Court should hold off on intervening

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Speaker 8: in the federal criminal case in Washington, d c. Regarding

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Speaker 8: overturning the election, Harvard University law professor Lawrence Tribe on Bloomberg.

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Speaker 8: Not surprising, he says, but maybe not smart.

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Speaker 10: The Court of Appeals has no special expertise. Whatever it

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Speaker 10: says is going to be subject reviewed by the US

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Speaker 10: Supreme Court anyway, there's no reason to wait. His own

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Speaker 10: arguments are the reason not to wait. And of course

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Speaker 10: it's hugely important that it he decided so that voters

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Speaker 10: know when they're going to the polls whether they're voting

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Speaker 10: for a convicted felon or for someone who was longly accused.

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Speaker 8: Now the crux of the case there is whether he

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Speaker 8: has immunity. Special counsel Jack Smith asking for a fast track,

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Speaker 8: Smith seeking to ensure the trial can start March fourth. Politically,

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Speaker 8: Bloomberg's Mike Dorning says it could help Trump the short term.

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Speaker 9: It benefits Trump at a really critical time in the

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Speaker 9: publican nomination process. We're a few weeks away from those

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Speaker 9: first early primaries in Iowa, New Hampshire, South Carolina. It's

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Speaker 9: the last chance for Republican to knock him out. And

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Speaker 9: now he's got the party rallying around him. He's the

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Speaker 9: center of attention. He's even got his rivals taking his

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Speaker 9: side on.

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Speaker 8: This, and other states are definitely affected by what's decided.

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Speaker 8: Michigan Arizona also have similar cases to the Colorado looking

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Speaker 8: for president. So a couple of things swirling around today

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Speaker 8: and a new Quinnipiac poll has Biden and Trump in

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Speaker 8: a dead heat at forty six forty seven percent, with

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Speaker 8: Robert Kennedy Junior sucking away twenty two percent of the

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Speaker 8: vote evenly from both. China's President she Champaign has told

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Speaker 8: US President Joe Biden that Beijing will reunify Taiwan with

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Speaker 8: mainland China, but the time has not been decided. Bloomber's

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Speaker 8: Kaylie Lyons reports a fine line to walk for the US,

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Speaker 8: whose technical position has had to support the One China.

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Speaker 11: Paula see As really underscores how difficult the Taiwan issue

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Speaker 11: is for this administration, which still technically abides by the

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Speaker 11: One China policy, tries to exercise strategic ambiguity when it

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Speaker 11: comes to Taiwan. But President Biden has also been on

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Speaker 11: the record saying that the US would come to Taiwan's

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Speaker 11: defense if attacked. Attack, of course, would implicate that it

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Speaker 11: is actually attempt to take it by force.

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Speaker 8: A conversation apparently occurred in San Francisco at APEX and

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Speaker 8: now I first been reported by NBC in Reaction today.

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Speaker 8: The first or hearing of it. Global News twenty four

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Speaker 8: hours a day and whenever you want it with Bloomberg

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Speaker 8: News now in San Francisco. I'm at Baxter. This is Bloomberg.

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Speaker 2: This is Bloomberg Daybreak Asia. Brian Curtis and Paul Allen.

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Speaker 2: Our colleague Vincent Signerella joins this. Vince's Bloomberg macro strategist

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Speaker 2: with us looking at market. So a fairly big sell

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Speaker 2: off there into the closed Vince. Some traders who are

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Speaker 2: talking about expiring zero day options that that may have

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Speaker 2: helped accelerate the sell off because it came up kind

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Speaker 2: of abruptly, although investors know that the market has been extended.

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Speaker 2: Anything in particular, catch you rye, Yeah, today, I mean

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Speaker 2: to be honest, today the games were on a little

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Speaker 2: bit of shaky ground.

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Speaker 12: You could feel some exhaustion in the market. We were

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Speaker 12: barely in the green for most of the day, and

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Speaker 12: then late in the session a few traders were telling

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Speaker 12: me about those same day options somewhere in the naghbor

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Speaker 12: to eight to ten thousand, depending on who you talk to.

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Speaker 12: The exercise price was either forty seven fifty five forty

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Speaker 12: seven sixty on the SPX, but big size and what

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Speaker 12: it did was trigger the delta hedge and the cash

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Speaker 12: for a one point nine billion dollars so off, So

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Speaker 12: you kind of had a sleepy market, not really doing

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Speaker 12: much A few days before Christmas, traders not really like

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Speaker 12: totally on top of their game, paying attention maybe an

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Speaker 12: hour or so before the close, and a SmackDown going

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Speaker 12: into it, and that's what took it out. But you know,

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Speaker 12: I just keep it in minds like you're saying, same

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Speaker 12: day expiries, We'll see what happens tomorrow and the rest

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Speaker 12: of the week, and with PCE coming up, I don't

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Speaker 12: think it changes the game. I think it just was

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Speaker 12: sort of a one day situation.

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Speaker 13: Yeah, you mentioned with a sleepiness there. I had a

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Speaker 13: volumes look. Compared to a typical holiday leaden.

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Speaker 12: Period, I think they're kind of more of the same.

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Speaker 12: I think it may be a little bit elevated in

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Speaker 12: this case because we've seen such great gains coming through,

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Speaker 12: so there's a little bit of enthusiasm. You've got some

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Speaker 12: fomo going on, and then you have some profit taking

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Speaker 12: going on. I mean, for a trader at this stage

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Speaker 12: of the game, nothing you do at this point of

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Speaker 12: the year is going to do much for your bonus,

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Speaker 12: so you tend not to do much period. You're just

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Speaker 12: kind of covering corporate business and doing what you have

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Speaker 12: to do. There's not a lot you can do to

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Speaker 12: help your own books, so they don't really kind of

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Speaker 12: get too excited about things.

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Speaker 2: You can understand a little bit of indecision among some

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Speaker 2: when you look at the data. We had consumer confidence

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Speaker 2: pretty solid there, up up to that level of north

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Speaker 2: of one oh seven. At the same time, you have

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Speaker 2: factory activity in the US that has been contracting now

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Speaker 2: for more than a year, and so it's a little

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Speaker 2: tricky to try to figure out. Especially when you see

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Speaker 2: a dropping bond yields like today, you start thinking about, well,

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Speaker 2: maybe somebody sees a lot slower growth out there, your

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Speaker 2: thoughts on where the economy is moving and whether whether

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Speaker 2: or not that's in sync with markets.

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Speaker 12: I think you make a good point. I mean, first,

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Speaker 12: you know, first of all, we're not really a manufacturing

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Speaker 12: economy anymore, so slower factory growth isn't the endgame, if

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Speaker 12: you will. But at the same time, I think what

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Speaker 12: we've seen is delinquencies are increasing, revolving creditors that record highs.

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Speaker 12: Consumer likely is getting close to tapped out, probably will

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Speaker 12: be in the first maybe second quarter of next year.

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Speaker 12: So slower growth is definitely on the horizon, but I

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Speaker 12: think that plays into maybe a little bit more aggress

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Speaker 12: is said in terms of rate cuts, So it's you know,

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Speaker 12: a little six and one half a dozen to the other.

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Speaker 12: I don't see wheels falling off. I think it's going

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Speaker 12: to be a nice slow decline. You look at inflation

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Speaker 12: in the UK today, that was very encouraging. I think

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Speaker 12: central bankers keep pushing back and saying we're not going

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Speaker 12: to cut as aggressively as you say we are. But

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Speaker 12: I think the most important thing is don't count how

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Speaker 12: many times they're going to cut or you think they're

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Speaker 12: going to cut. The fact that they're going to cut

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Speaker 12: is what you really need to hold on to, and

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Speaker 12: that the quantitative tightening cycle is basically over. And if

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Speaker 12: it takes a little longer to get to where you

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Speaker 12: want it to be, that's fine. It'll just be a nicer, slower,

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Speaker 12: steadier pace of perhaps growth, earnings and risk assets.

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Speaker 13: Yeah, this idea of cutting rights, I mean that does

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Speaker 13: suggest the economy would require stimulus. I mean you mentioned

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Speaker 13: things sort of backing off a bit, but you know,

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Speaker 13: how much stimulus does the economy require?

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Speaker 10: Really?

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Speaker 13: I try it is getting a bit out of themselves

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Speaker 13: here in terms of this right expectation.

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Speaker 12: Yeah, I think way ahead of themselves, looking for three

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Speaker 12: next year and five actually the year after is very, very,

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Speaker 12: very aggressive. But again, I don't think it's an issue

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Speaker 12: of stimulus so much with the central banks. I think

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Speaker 12: it's an issue of a fear of overtightening, and they're

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Speaker 12: trying to get back to this neutral sort of balance

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Speaker 12: where they're not tightening, but they're not necessarily easing. They're

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Speaker 12: just feeding the economy what it needs to keep going.

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Speaker 12: They don't want to ease over ease either. They don't

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Speaker 12: want to see inflation pick back up again. But they're

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Speaker 12: very much now in the camp of, well, if we overtighten,

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Speaker 12: we could crater global growth, and that basically is the

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Speaker 12: exact opposite of what we saw during the pandemic or

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Speaker 12: post pandemic, which is not what they want to see.

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Speaker 2: On the corporate front, a couple of interesting possible mergers

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Speaker 2: Nippon Steele moving on US deal with a massive premium,

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Speaker 2: and then hearing via Axios that Warner Brothers, Discovery and

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Speaker 2: Paramount Global are talking anything catch your eye in either

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Speaker 2: those stories or others like that. That kind of clue

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Speaker 2: you into the confidence in markets.

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Speaker 12: Well, you know, it's interesting, a lot of people are

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Speaker 12: talking about M and A picking up next year very

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Speaker 12: very aggressively. You talk to firms like you know, Molus,

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Speaker 12: which is one of the leaders in you know, a

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Speaker 12: small firm, the leader in M and A field. Everybody

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Speaker 12: expects this big jump at M and A. And I

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Speaker 12: think you make a good point that speaks to confidence.

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Speaker 12: You're not going to be going out as a corporate

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Speaker 12: CEO buying another company or looking to merge with another

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Speaker 12: company and likely taking on debt or diluting shares if

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Speaker 12: you don't think things are going to progress positively. It's

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Speaker 12: I think it's a good sign. It's a good sign

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Speaker 12: for global growth.

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Speaker 2: Yea, all right, Vince, thanks very much for joining us.

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Speaker 2: Vincent Signorella Bloomberg macro strategist with us. This is Bloomberg

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