Speaker 1: Good morning.
Speaker 2: I'm Nathan Hager and I'm Karen Moscow. Here are the
Speaker 2: stories we're following today.
Speaker 3: We have three.
Speaker 4: Major policy decisions on tap, including from the Fed. We
Speaker 4: get a preview now from Bloomberg's Michael McKee.
Speaker 5: The Fed has signaled it has at least one more
Speaker 5: quarter point rate increase to go, and a still tight
Speaker 5: labor market is expected to lead them to go ahead
Speaker 5: on Wednesday. Futures are pricing in a ninety six percent
Speaker 5: chance of a move For investors, the real question is
Speaker 5: what next. Fed officials said in June they anticipated two
Speaker 5: more rate moves. What did they signal after their meeting?
Speaker 5: And let's also think the ECB is close to ending
Speaker 5: its tightening cycle one more move and then on hold.
Speaker 5: European markets are still pricing in cuts and President Christine
Speaker 5: Legard will try to wave those off. In Japan's still
Speaker 5: a long way to get to where they want to be.
Speaker 5: Inflation is up but projected to fall, so investors see
Speaker 5: less than a ten percent chance of a rate move.
Speaker 5: They may talk about ending yield curve control, but have
Speaker 5: no plans to do it yet. Michael McKee, Bloomberg Gay
Speaker 5: break All right.
Speaker 2: Mike, Thanks, well, expect moves from all three central banks.
Speaker 2: That's the call from Ahammadalarian, chief economic advisor for Alliance,
Speaker 2: and a Bloomberg opinion columnist.
Speaker 6: All three are going to hike by twenty five basis points,
Speaker 6: but that's where the communality will end. I think the
Speaker 6: FED will come across as stubvish, the Bank of England
Speaker 6: will still be quite hawkish, and the ECB will be
Speaker 6: in the middle in terms of the Ford policy.
Speaker 2: Guidance and when it comes to inflation, Bloomberg Opinion columnists
Speaker 2: Muhammadalarian says the FED will ultimately have to settle on
Speaker 2: a new target rate around three percent and as compared
Speaker 2: to the current two percent inflation target.
Speaker 4: It's also a busy week for earnings, Karen. About a
Speaker 4: third of the companies in the S and P five
Speaker 4: hundred roll report this week, and we've already heard from
Speaker 4: oil giant Chevron. Bloomberg's Doug Krisner has the details.
Speaker 7: The results reflect record shale oil output in the Permian
Speaker 7: Basin adjusted EPs, we're three dollars eight cents higher than
Speaker 7: the Bloomberg consensus. However, net income fell to six billion dollars.
Speaker 7: It's the fourth straight quarter of lower results for Chevron.
Speaker 7: Net income is fallen to nearly half the level of
Speaker 7: last year when oil price is surged after Russia's invasion
Speaker 7: of Ukraine. Now Chevron is on a quest for record
Speaker 7: shareholder returns and the company is waiving the mandatory retirement
Speaker 7: age for chairman and CEO Mike Worth in New York.
Speaker 7: I'm Doug Chrisner, Bloomberg Day Break.
Speaker 2: All right, Doug, thanks well, another corporate news. Elon Musk
Speaker 2: is making another change at Twitter. He's hoping X marks
Speaker 2: the spot of profitability for the social media company, and
Speaker 2: we get the details from Bloomberg's John Tucker.
Speaker 8: Say goodbye to Twitter's Bloomberg logo. It's being replaced with
Speaker 8: a stylized x X dot com. Now readdirects to Twitter
Speaker 8: dot com. Elon Musk hans at affinity for x X
Speaker 8: dot com was the original name for PayPal. It's in
Speaker 8: the SpaceX company name. It's in the name for Tesla's SUV.
Speaker 8: The abrupt change comes as Twitter faces a steep decline
Speaker 8: and ad dollars and a new rival, it Meta Platforms
Speaker 8: Threads x is envisioned is an AI powered global marketplace
Speaker 8: including payments and banking alongside audio, video and messaging. You
Speaker 8: knoww York. I'm John Tucker Bloomberg Daybreak.
Speaker 9: Thank you, John Well.
Speaker 4: It's been a tough summer for Hollywood, between the labor
Speaker 4: strikes and disappointing blockbusters, but an unlikely double feature this
Speaker 4: past weekend is giving cinemas something to smile about. Barbie
Speaker 4: earned one hundred and fifty five million dollars in its
Speaker 4: box office debut, and it came out the same weekend
Speaker 4: as Oppenheimer, which brought an eighty and a half million.
Speaker 4: About two hundred thousand movie fans bought tickets to both
Speaker 4: films on the same day that Barbenheimer phenomenon helped theaters
Speaker 4: turn in their best weekend since Marvel's Avengers Endgame in
Speaker 4: twenty nineteen.
Speaker 2: Lot of more serious know here, Nathan. Let's turn to politics.
Speaker 10: Now.
Speaker 2: Are US China relations remain largely in focused? Secretary of
Speaker 2: st Anthony B. Lincoln says the rest of the world
Speaker 2: is eager to see ties improve between Washington and Beijing,
Speaker 2: and Bloomberg's Ed Baxter has that story.
Speaker 11: Blanc and says he's hearing from all over the globe
Speaker 11: concern about how it will be managed to.
Speaker 12: Make sure that we sustain these lines of communication, that
Speaker 12: we continue to talk, and that we work on, as
Speaker 12: I said, both dealing with the differences and seeing if
Speaker 12: we can cooperate. That's the way we're approaching it. I
Speaker 12: think it's the responsible thing to do.
Speaker 11: Blak And on CNN says both will continue to say
Speaker 11: things the other does not like, but the relationship will
Speaker 11: be based on how it is managed going forward. In
Speaker 11: San Francisco, I'm at Baxter Bloomberg daybreak.
Speaker 4: Thanks, and we've had a significant and confusing election result.
Speaker 11: In Spain.
Speaker 4: Prime Minister Pedro Sanchez has denied his political rivals a
Speaker 4: majority in parliament after his Socialist party performed better than
Speaker 4: expected in yesterday's election. The Conservative People's Party won the
Speaker 4: most seats in Spain's parliament, but the Socialists also saw gains.
Speaker 4: We get more from Bloomberg's Maria TODAYO in Madrid if you.
Speaker 13: Focus on the winner, and if I see that as
Speaker 13: a conservative party, they won the most votes, but also
Speaker 13: the most speak The problem that they have is that
Speaker 13: that is not enough in Spanish politics. ME and the
Speaker 13: winner will not take you into government if you don't
Speaker 13: have a majority. Last night is that there are huge
Speaker 13: pockets of Spanish voters that will go out of vote
Speaker 13: to prevent what they proceed as the farm Right entering
Speaker 13: a government.
Speaker 4: Bloomberg's Maria Todayo says Pedro Sanchez will remain Prime Minister
Speaker 4: for the time being, but he may have to call
Speaker 4: another election later this year. This is Bloomberg. It's time
Speaker 4: now to take a look at some of the other
Speaker 4: stories making news in New York and around the world
Speaker 4: with Bloomberg's Michael bar Good morning, Michael.
Speaker 3: Good morning, Nathan. It's not just New Jersey filing a
Speaker 3: lawsuit against New York City's congestion pricing plan. Staten Island
Speaker 3: plans to file a lawsuit as well. Borough president Veto Facila,
Speaker 3: like officials at the Garden State, are pointing to the
Speaker 3: environmental studies saying will cost more for people in Staten
Speaker 3: Island and hurt the borough's environment.
Speaker 5: To sit here and then say to the people of
Speaker 5: Staten Island that you're going to pay more and your
Speaker 5: air quality is going to be worse doesn't make any sense.
Speaker 3: Audio courtesy of ABC seven. Many Staten Islanders can't take
Speaker 3: the ferry and could end up paying even more to
Speaker 3: get into Manhattan. Below sixtieth Street when the congestion pricing
Speaker 3: plan kicks in. In a statement from the MTA, contrary
Speaker 3: to any claim that there was insufficient study, the environmental
Speaker 3: assessment actually covered every conceivable pretend potential traffic, air quality,
Speaker 3: and social economic effect. An unsettling discovery reported at the
Speaker 3: house of the accused Gilgo Beach serial killer Rex Huerman
Speaker 3: on Long Island. According to the New York Post, police
Speaker 3: told a neighbor that investigators found a sound proof room
Speaker 3: in the basement of the home and believe at least
Speaker 3: one victim was killed there. Officials have been searching inside
Speaker 3: the home to determine if any of the victims wherever inside.
Speaker 3: Souffolk County Police Commissioner Rodney Harrison says Hewerman's appearance of
Speaker 3: normality was a cover that hit his true nature.
Speaker 13: He lived a double life.
Speaker 10: You know.
Speaker 13: He had a family and a wife and two kids.
Speaker 5: He had a good job in being an architect, but
Speaker 5: what he did at night, he was a different human
Speaker 5: being and a dangerous individual.
Speaker 3: Suffolk County Police Commissioner Rodney Harrison says that they've been
Speaker 3: using cadaver dogs, ground penetrating sonar, and an excavator to
Speaker 3: scour Hureman's backyard. The current heat wave has been setting
Speaker 3: records across the country. Tens of millions of Americans from
Speaker 3: California to Florida are struggling to cope with scorching heat,
Speaker 3: like this man visiting Palm Springs. It was one hundred
Speaker 3: and twenty yeah, and it's klt like somebody just lit
Speaker 3: a match in in front of us. Now. The heat
Speaker 3: wave is forecast to expand into the Midwest and northern plains.
Speaker 3: Israeli Prime Minister Benjamin at Yahoo was released from the
Speaker 3: hospital today after an emergency heart procedure. It comes ahead
Speaker 3: of a key vote in the government's judicial overhaul plan
Speaker 3: that has divided the country. Global News twenty four hours
Speaker 3: a day, powered by more than twenty seven hundred journalists
Speaker 3: analyst over one hundred twenty countries. I'm Michael Barrd. This
Speaker 3: is Bloomberg Nah.
Speaker 4: Thank you, Michael. Time now for the Bloomberg Sports Update.
Speaker 4: Good morning, johns Stasho, Good morning Nathan. Two games Subway
Speaker 4: series starting tomorrow and the Bronx. The Yankees come off
Speaker 4: a sweep of the Royals. The Mets off a loss
Speaker 4: last night in Boston. Carlos Carrasco started and got only
Speaker 4: seven ounce and he was gone, having given up five
Speaker 4: runs ten hits.
Speaker 14: His era is near six. The Red Sox went on
Speaker 14: to win six to one, as the Mets got only
Speaker 14: six hits, all singles at the stadium, something that had
Speaker 14: not occurred in a very long time.
Speaker 11: Well, once again, it'll be a three to two from
Speaker 11: Lyles to Rizzo swung on head high in.
Speaker 10: The air, to right, all right back to the wall,
Speaker 10: and it is gone. Waters went back as far as
Speaker 10: he could go. Anthony Rizzo has not homers is May.
Speaker 14: Twentyth on WFA and forty five games without a homer,
Speaker 14: so sure enough, Rizzo's teammates gave him the silent treatment
Speaker 14: when he got to the dugout. The homer part of
Speaker 14: a four for four day for Rizzou. Yanks beat the Royals,
Speaker 14: who are forty five games under five hundred, eight to five.
Speaker 14: Luis Savarino got just his second win. Perhaps more significant
Speaker 14: than the victory. Before the game, Aaron Judge, facing live
Speaker 14: pitching for the first time since the tow injury in
Speaker 14: early June, Cooperstown Induction Day and into the Baseball Hall
Speaker 14: of Fame goes Scott Rowland and Fred McGriff. Roland made
Speaker 14: it despite getting only ten percent of the vote the
Speaker 14: first time he was on the ballot. McGriff never voted
Speaker 14: in by the writers, but earned entry through the Veterans Committee.
Speaker 14: Brian Harmon not exactly a Golf Hall of Famer. He
Speaker 14: had only won two tournaments, none since twenty seventeen. The
Speaker 14: odds on him winning the Open Championship at Royal Liverpool
Speaker 14: where one hundred and twenty five to one, but a
Speaker 14: near wire to wire victory. Harmon ended up winning by
Speaker 14: six shots. Finished thirteen under par, four straight under par
Speaker 14: rounds four way tie for second. Rriy Ay tie for sixth.
Speaker 14: Johns Stashnewer Bloomberg Sports.
Speaker 9: From coast to coast, from New York to San Francisco,
Speaker 9: Boston to Washington, DC, nationwide on Syrias Exam, the Bloomberg
Speaker 9: Business app, and Bloomberg dot Com.
Speaker 4: This is Bloomberg Daybreak. Good morning, I'm Nathan Hager. It
Speaker 4: is the start of a very busy week for markets.
Speaker 4: We have a Federal Reserve decision coming in two days,
Speaker 4: ECB and Bank of Japan policy decisions as well, and
Speaker 4: a big batch of earnings on the way. Including some
Speaker 4: of the megacap tech names that have driven this year's
Speaker 4: rally in stocks. Let's bring in Lori Calvacina for a
Speaker 4: look at this market at the start of this week.
Speaker 4: Laurie is head of US Equity strategy at RBC Capital Markets.
Speaker 4: Good morning, Laurie. Good to have with you on with
Speaker 4: us as always, what do you think is going to
Speaker 4: be the bigger driver for this market this week? The
Speaker 4: central banks or the earnings?
Speaker 15: Well, thanks for having me as always, Navian, And I
Speaker 15: think that's actually a fabulous question to start the week
Speaker 15: off with, because I think it's going to be all
Speaker 15: about earning.
Speaker 2: You know.
Speaker 15: One of the things our rate strategy team has talked
Speaker 15: about on the said is they think the FAED narrative
Speaker 15: is likely to stay kind of boring for a while.
Speaker 15: And I think equity investors have already come to that
Speaker 15: conclusion that we're probably going to get one more hype
Speaker 15: that's probably the end of it. We'll have to wait
Speaker 15: and see, of course, that they do want to fight
Speaker 15: on inflation one. So I think that's you know, sort
Speaker 15: of settled in a lot of equity investors' minds. But
Speaker 15: I think there's a real questions on this earning season,
Speaker 15: whether or not these big cap tech companies are going
Speaker 15: to continue to dominate sort of the excitement and enthusiasm
Speaker 15: around earning, or if it's time for this market to
Speaker 15: broaden out and see some of the other sectors generate
Speaker 15: through incremental excitement, which I think, if it happens, could
Speaker 15: really spark a shift in leadership that a lot of
Speaker 15: people have been hoping and looking for.
Speaker 4: Grace is a couple of questions. I'll start with the
Speaker 4: first one, whether the excitement we've seen around the artificial
Speaker 4: intelligence craze. I mean, anytime a company mentions AI, it
Speaker 4: seems like they get a little bit of a spike
Speaker 4: in their stock number. Is this the earning season where
Speaker 4: these companies are going to have to put some meat
Speaker 4: behind some of that frenzy.
Speaker 15: Well, I think that frenzy. I think even a lot
Speaker 15: of companies who are talking about it, it's something that's
Speaker 15: talked about as you know, sort of a longer term
Speaker 15: kind of driver, at least some of the more legitimate conversations.
Speaker 15: I think that companies do have to be careful there though,
Speaker 15: because one of the things I've heard over the last
Speaker 15: couple of months, and we really did see that AI
Speaker 15: conversation spark in our spike in really May and June,
Speaker 15: that's when it really came on the scene. There's a
Speaker 15: lot of pushback from investors, you know, at least the
Speaker 15: ones I talk to. We're companies who aren't really that involved.
Speaker 15: We're trying to make a bigger deal of it than
Speaker 15: it really is. So I think companies want to be really,
Speaker 15: really careful not to over hype it because, to be honest,
Speaker 15: I think it just irritated a lot of portfolio managers.
Speaker 4: Okay, And in terms of the breadth question, are you
Speaker 4: starting to see more breadth get into this market? Do
Speaker 4: you think that can last?
Speaker 15: You know, it's funny. We have a bunch of trades
Speaker 15: that we monitor in our weekly which comes out on Mondays,
Speaker 15: and we look at things like banks versus NESC one hundred,
Speaker 15: regional banks versus mess stack one hundred, small versus large,
Speaker 15: all the sector trades, and you're starting to see a
Speaker 15: lot of stuff shift now, the attempts by the banks
Speaker 15: and the small caps to really kind of fight back
Speaker 15: and show some leadership. It's been kind of simmering under
Speaker 15: the surface for a while. A lot of these trades
Speaker 15: had stalled at kind of twenty twenty extremes, so I've
Speaker 15: kind of gotten beaten down as much as they tended
Speaker 15: to back then relative to some of these other baskets.
Speaker 15: So I think these are you know, sort of lions
Speaker 15: that are waiting in the brush to pounce. But so far,
Speaker 15: you know, we are starting to see it. In July
Speaker 15: at least, we are starting to see some of that
Speaker 15: rotation happen. So we'll see if earnings gives it an
Speaker 15: excuse to keep going. That's the big question for me
Speaker 15: these next few weeks.
Speaker 4: How do you think earnings will potentially justify some of
Speaker 4: the valuations that we're seeing in some of these stocks,
Speaker 4: particularly the megacaps.
Speaker 15: So I think that valuation it's a tough moment in
Speaker 15: time to discuss valuation. Certainly, the growth part of the
Speaker 15: market looks overextended at this point in time, and I
Speaker 15: think that is one of the things that could to
Speaker 15: give give room for this leadership rotation to happen. You know,
Speaker 15: I don't think there's a lot of a lot of
Speaker 15: parts of the market that look too cheap, at least
Speaker 15: on absolute multiple, but if you look at things like
Speaker 15: growth versus value, you're back to past peak. So I
Speaker 15: think one of the things we tend to see in
Speaker 15: these big recovery trades, and I do think this feels
Speaker 15: like a recession recovery trade, even though we didn't have
Speaker 15: a recession last year, I think one got priced in.
Speaker 15: But at any rate, we tend to see, you know,
Speaker 15: kind of one part of the market dominate, and then
Speaker 15: the second half of the rally will be fueled by
Speaker 15: kind of a catch up trade. I've been really intrigued
Speaker 15: by what's going on in healthcare because I think you're
Speaker 15: starting to see some signs of a catch up trade there.
Speaker 15: I think financials had really been held back, not just
Speaker 15: by the banking crisis, but near term recession fears, and
Speaker 15: we're seeing those really ease up. So I think that
Speaker 15: gives us some room for some of that catch up,
Speaker 15: which basically will allow certain multiples to rerate a bit.
Speaker 4: Got about thirty seconds left here, Laurie. We are seeing
Speaker 4: the S and P five hundred just about two hundred
Speaker 4: and sixty points away from breaking out of the bear
Speaker 4: market low from last October. Is is this a new
Speaker 4: bullmarket or are you looking for more choppiness ahead?
Speaker 15: So I don't want those terms bullmarket, bear market rally.
Speaker 13: I know that sounds.
Speaker 15: Strange coming from a strategist, but you know, I think
Speaker 15: people got stuck in this bear market rally. Oh, it's
Speaker 15: not real kind of mentality. We were never thinking that way.
Speaker 15: We've always thought this was a messy post crisis normalization period,
Speaker 15: similar to two o three and twenty ten, twenty eleven
Speaker 15: coming out of the GFC in the tech bubble. If
Speaker 15: that analogy holds, this is about the moment in time
Speaker 15: when you should come out of the rut. Basically, those
Speaker 15: messy normalization periods last things out a year and a half,
Speaker 15: and that's where we are at this point in the
Speaker 15: timeline to the pandemic.
Speaker 1: This is Bloomberg day Break Today, your morning brief on
Speaker 1: the story's making news from Wall Street to Washington and beyond.
Speaker 2: Look for us on your podcast feed at six am
Speaker 2: Eastern each morning, on Apple, Spotify, and anywhere else you
Speaker 2: get your podcasts.
Speaker 1: You can also listen live each morning starting at five
Speaker 1: am Wall Street time on Bloomberg eleven three to oho
Speaker 1: in New York, Bloomberg ninety nine to one in Washington,
Speaker 1: ten Bloomberg one oh sixty one in Boston, and Bloomberg
Speaker 1: nine sixty in San Francisco.
Speaker 2: Our flagship New York station, is also available on your
Speaker 2: Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty plus.
Speaker 1: Listen coast to coast on the Bloomberg Business app, serious
Speaker 1: XM Channel one nineteen, the iHeartRadio app, and on Bloomberg
Speaker 1: dot com. I'm Nathan Hager and.
Speaker 2: I'm Karen Moscow. Join us again tomorrow morning for all
Speaker 2: the news you need to start your day, right here
Speaker 2: on Bloomberg Daybreak