WEBVTT - Bloomberg Daybreak: July 12, 2022 - Hour 2 (Radio) 0:00:02.920 --> 0:00:06.240 Live from the Bloomberg Interactive Berger Studios. This is Bloomberg 0:00:06.320 --> 0:00:09.960 Daybreak for a Tuesday, July twelve two. Coming up this hour, 0:00:10.280 --> 0:00:13.360 the Wall Street stock sell off continues this morning. The 0:00:13.760 --> 0:00:16.520 A says the worst of the energy crisis maybe ahead. 0:00:16.680 --> 0:00:19.280 We are tracking the latest developments in the Twitter elon 0:00:19.400 --> 0:00:22.560 must saga, and the January six Committee focuses on far 0:00:22.760 --> 0:00:26.040 right groups and what former President Trump knew about their plans. 0:00:26.320 --> 0:00:28.680 Officials want people in New York City to mask up 0:00:28.680 --> 0:00:32.159 again indoors. Plus, funeral services were held today for former 0:00:32.240 --> 0:00:35.599 Japanese per Minister Rombe. I'm Michael bar More Ahead, I'm 0:00:35.640 --> 0:00:38.080 time Stash Howard. Sports matchers are pitched the Mets to 0:00:38.120 --> 0:00:40.440 a big win in Atlanta, and pied Delonso will be 0:00:40.560 --> 0:00:45.680 in next week's home run Dirt. That's all trading ahead 0:00:45.720 --> 0:00:49.280 on Bloomberg Daybreak on Bloomberg eleven three, on New York, 0:00:49.479 --> 0:00:54.160 Bloomberg one, Washington, d C, Bloomberg one O six one, Boston, 0:00:54.440 --> 0:00:58.880 Bloomberg nine sixties and Francisco Syrius XM one nine team, 0:00:59.080 --> 0:01:02.000 and around the world on Bloomberg Radio dot com and 0:01:02.160 --> 0:01:08.920 via the Bloomberg Business App. Good morning, I'm Nathan Hagar 0:01:09.360 --> 0:01:13.440 and I'm Karen. Moscow and US futures are lower this morning. 0:01:13.440 --> 0:01:15.440 We're coming up to six oh one on Wall Street, 0:01:15.480 --> 0:01:17.600 and we checked the markets every fifteen minutes throughout the 0:01:17.600 --> 0:01:20.200 trading day. On Bloomberg, U S and P futures down 0:01:20.240 --> 0:01:24.080 about twenty eight points down, futures down two twenty three 0:01:24.080 --> 0:01:28.040 and NASDAG features down two. The DAGs in Germany's down 0:01:28.040 --> 0:01:30.240 eight tens of upper cent in the ten year treasury 0:01:30.600 --> 0:01:33.560 ye thirty seconds, he'll two point nine one percent, and 0:01:33.600 --> 0:01:36.399 they yield on the two year two point nine percent. 0:01:36.720 --> 0:01:39.880 Nathan Well Karen futures are adding to yesterday's losses, which 0:01:39.880 --> 0:01:42.920 saw all three major indexes fall. The hardest hit was 0:01:42.959 --> 0:01:45.920 the NASTAC, which dropped two and a quarter percent. Still, 0:01:45.959 --> 0:01:48.880 Alan zaffron Co, CEO at I e Q Capital says 0:01:48.920 --> 0:01:51.760 growth stocks may be the place to invest. We are 0:01:52.200 --> 0:01:56.280 looking forward at a slower growing economy, given what's happening 0:01:56.280 --> 0:01:58.639 with the FED, given what's happened with a more heightened 0:01:58.680 --> 0:02:01.880 inflationary environment, and so it is a setup for growth 0:02:02.000 --> 0:02:05.400 stocks to outperform value stocks looking forward for quite some time. 0:02:05.600 --> 0:02:07.920 I e Q Capital's Alan's afer and says the upcoming 0:02:07.960 --> 0:02:10.840 earning season will be key for the markets well, Nathan. 0:02:10.840 --> 0:02:13.440 The Wall streets sell off spread to Asia overnight. Both 0:02:13.480 --> 0:02:16.560 Japan's and NK and Hong Kong's Hang Sang Index stramre 0:02:16.600 --> 0:02:19.400 than one percent. I'm making the recap from Bloomberg Daybreak, 0:02:19.440 --> 0:02:22.920 Asia anchor Brian Curtis in Hong Kong. Asian stocks fell 0:02:23.040 --> 0:02:26.960 on concerns over the economic outlook, high inflation, and China's 0:02:26.960 --> 0:02:31.240 issues with COVID. The text actors struggled, sparking weakness in Japan, 0:02:31.360 --> 0:02:34.320 Hong Kong, and China. The dollar pushed higher, up near 0:02:34.400 --> 0:02:37.519 the levels that we saw in the panic over COVID. 0:02:37.760 --> 0:02:40.639 The euro has edged closer to parody, with the greenback 0:02:40.720 --> 0:02:45.400 sapped by Europe's energy crisis and fears of recession. Treasuries gained, 0:02:45.440 --> 0:02:49.160 taking the tenure yield well below three percent. Bonds also 0:02:49.240 --> 0:02:53.640 rallied in Australia. You know, Hong Kong, Brian Curtis, Bloomberg Daybreak, Brian, 0:02:53.680 --> 0:02:56.359 thank you. Oil is moving lower this morning. West Texas 0:02:56.440 --> 0:02:59.120 Intermediates down two point three percent to a hundred one 0:02:59.160 --> 0:03:02.880 dollar sixties extensive barrel. A COVID resurgence in China is 0:03:02.880 --> 0:03:06.560 adding to concerns about a global economic slowdown. Fatty Barole, 0:03:06.680 --> 0:03:09.799 executive director at the International Energy Agency, says the worst 0:03:09.840 --> 0:03:13.680 of the energy crisis maybe ahead. The world has never 0:03:13.840 --> 0:03:19.799 witnessed such a major energy crisis. It is interwoven by 0:03:19.880 --> 0:03:24.680 many factors, including the geopolitics, and I believe we might 0:03:24.720 --> 0:03:28.280 not have seen the worst of it yet. I e 0:03:28.400 --> 0:03:31.480 A Executive director Fatty Barol says this winter in Europe 0:03:31.480 --> 0:03:35.200 will be quote very very difficult. Well making investors are 0:03:35.200 --> 0:03:38.960 closely watching for the release of June's Consumer Price Index tomorrow. 0:03:39.000 --> 0:03:40.680 The White House is keeping an eye on it. You. 0:03:40.920 --> 0:03:44.320 Press Secretary Karine john Pierre said the inflation data will 0:03:44.360 --> 0:03:48.000 be highly elevated, but she also notes it's backward looking. 0:03:48.400 --> 0:03:51.920 June's CPI data is already out of date because energy 0:03:51.960 --> 0:03:55.880 prices have come down substantially this month and are expected 0:03:55.920 --> 0:03:59.280 to fall further. White House smokes showman Karne John Pierre 0:03:59.360 --> 0:04:01.960 says fooding gas prices continue to be impacted by the 0:04:02.000 --> 0:04:05.640 war in Ukraine. Economist surveyed by Bloomberg expect June prices 0:04:05.640 --> 0:04:08.520 to jump eight point eight percent compared to last year. 0:04:08.800 --> 0:04:11.200 That would be a fresh forty year high. We're also 0:04:11.240 --> 0:04:14.400 continuing to follow the saga between Elon Musk and Twitter, 0:04:14.600 --> 0:04:18.440 Karen after shares fell more than eleven percent yesterday. Let's 0:04:18.480 --> 0:04:21.520 get the latest live from Bloomberg's Rinity Young. Good morning, Grenita, 0:04:21.560 --> 0:04:25.360 Good morning Nathan. Twitter lawyers are calling Elon Musk's termination 0:04:25.440 --> 0:04:27.680 of his forty four billion dollar deal to buy the 0:04:27.720 --> 0:04:31.400 company invalid and wrongful. They wrote it in a letter 0:04:31.440 --> 0:04:34.160 to his attorneys, and it's a preliminary step in the 0:04:34.279 --> 0:04:37.120 legal battle over the deal now. Musk agreed to buy 0:04:37.160 --> 0:04:39.719 Twitter for fifty four dollars and twenty cents a share, 0:04:40.000 --> 0:04:43.800 but he terminated the agreement because he believes Twitter misrepresented 0:04:43.880 --> 0:04:47.440 user data, claiming the number of spambots on the platform 0:04:47.760 --> 0:04:50.800 is much higher than the five percent the company has disclosed. 0:04:51.080 --> 0:04:54.640 Bloomberg sources say Twitter aims to file suit early this week, 0:04:55.040 --> 0:04:57.760 and the agreement specifies in any legal dispute over the 0:04:57.839 --> 0:05:01.240 deal must be heard in Delaware, Live in New York. 0:05:01.279 --> 0:05:03.520 I'm we need a Young Bloomberg day break. All right, 0:05:03.560 --> 0:05:05.400 we need to thank you well. One other note on 0:05:05.480 --> 0:05:08.120 the world's richest man this morning, Elon must says Donald 0:05:08.120 --> 0:05:11.400 Trump should quote sail into the sunset and forget about 0:05:11.480 --> 0:05:14.520 running for president again. In a series of tweets, must 0:05:14.520 --> 0:05:18.040 claim that Florida Governor Ronde Santis would easily defeat President Biden. 0:05:18.279 --> 0:05:20.560 He also told this one hundred million followers that there 0:05:20.600 --> 0:05:23.720 was too much drama when former President Trump was in office. 0:05:24.120 --> 0:05:27.320 Speaking of drama, Karen Testimony on last year's attack at 0:05:27.320 --> 0:05:30.080 the US Capital rolls on in Washington and up next 0:05:30.120 --> 0:05:32.280 the House January six committee will focus on the role 0:05:32.320 --> 0:05:36.040 of extremists in the insurrection, Bloomberg said, Baxter has the story. 0:05:36.279 --> 0:05:39.760 Committee member Jamie Raskin says it will continue building on 0:05:39.800 --> 0:05:42.000 the case that Donald Trump had a hand and trying 0:05:42.040 --> 0:05:45.359 to overthrow the results of the election and led to 0:05:45.400 --> 0:05:48.920 the advance that day on January six, Raskin says, you 0:05:48.960 --> 0:05:52.520 will focus on what's become known as Team Crazy, a 0:05:52.560 --> 0:05:55.800 group of people around Trump, Sidney Pale, Rudy Giuliani among them. 0:05:55.880 --> 0:05:59.120 Raskin says one of the meetings was unlike anything in 0:05:59.160 --> 0:06:02.800 American history reap now. The committee has also announced postponement 0:06:02.839 --> 0:06:05.880 a Thursday's hearing because it is getting so much new 0:06:05.920 --> 0:06:10.039 information on White House ties in San Francisco. I'm at 0:06:10.080 --> 0:06:13.359 Baxter Bloomberg Daybreak and thank you in corporate news this morning, 0:06:13.360 --> 0:06:16.760 San Francisco based Gap has fired at CEO Sonya San 0:06:17.120 --> 0:06:19.200 was dismissed after two and a half years on the job, 0:06:19.240 --> 0:06:21.960 and we get the story from Bloomberg Shirley Pellett. The 0:06:22.000 --> 0:06:26.440 apparel company is struggling to leave operational challenges behind it. 0:06:26.839 --> 0:06:30.640 Chairman Bob Martin is taking over immediately as CEO on 0:06:30.680 --> 0:06:34.880 an interim basis. GAP shares aren't down fifty percent this year, 0:06:35.080 --> 0:06:37.320 compared with a thirty percent dropped for the S and 0:06:37.400 --> 0:06:41.840 P five retailing index. Single took over in early twenty 0:06:42.160 --> 0:06:45.960 right before Covid royaled the business and demand. Prior to that, 0:06:46.000 --> 0:06:48.720 she was in charge of the company's old Navy brand 0:06:49.279 --> 0:06:52.720 in New York. Charlie Pellett Bloomberg Daybreak. All right, Charlie, 0:06:52.720 --> 0:06:55.280 thank you, and job cuts are coming at Microsoft. The 0:06:55.680 --> 0:06:58.279 layoffs effect less than one percent of the workforce and 0:06:58.360 --> 0:07:01.040 span a variety of groups in it in consulting and 0:07:01.160 --> 0:07:04.280 customer and partner solutions. Microsoft says the cuts were not 0:07:04.400 --> 0:07:07.839 spurred by economic factors. Back in May, the company also 0:07:07.880 --> 0:07:11.640 slowed hiring it its windows and office groups. SMP futures 0:07:11.640 --> 0:07:15.200 down twenty seven points. Nasdaq futures down seventy two straight 0:07:15.240 --> 0:07:17.600 ahead your latest local headlines in the check of sports. 0:07:17.960 --> 0:07:24.800 This is Bloomberg six oh seven on Wall Street where 0:07:24.800 --> 0:07:27.280 at sixty nine degrees in Central Park. Problems headed to 0:07:27.360 --> 0:07:30.280 New York Airport. There's an accidents southbound Rouge one at 0:07:30.320 --> 0:07:33.520 Third Avenue. Details coming up in traffic. First Michael Barr 0:07:33.560 --> 0:07:35.040 with what else is going on in New York and 0:07:35.080 --> 0:07:39.160 around the world. New concerns about COVID. Michael, that is correct, Nathan. 0:07:39.200 --> 0:07:41.760 The Department of Health is continuing to urge New York 0:07:41.840 --> 0:07:45.600 City residents to wear masks in all public indoor settings 0:07:45.680 --> 0:07:49.440 and in crowded areas outdoors because of an uptick in COVID. 0:07:49.760 --> 0:07:52.920 It comes as the latest mcron variant B A point 0:07:53.000 --> 0:07:56.600 five has become the dominant strain in the US. This 0:07:56.760 --> 0:08:00.360 New Yorker says people got lacks about masking. I think 0:08:00.600 --> 0:08:03.080 the city is the government's gonna have a hard time 0:08:03.160 --> 0:08:06.720 getting people back into nest. Meanwhile, about two out of 0:08:06.760 --> 0:08:10.120 three people in the US are fully vaccinated. Harvard Medical 0:08:10.160 --> 0:08:14.200 School professor Dr John Brownstein says the evolution of variants 0:08:14.240 --> 0:08:19.080 unresponsive to immunity from previous infections means we are likely 0:08:19.160 --> 0:08:21.280 going to have to give up on the idea of 0:08:21.280 --> 0:08:24.960 her community. You see this virus evolved quicker and quicker, 0:08:24.960 --> 0:08:27.840 and we'll probably see another variant in the fall. So 0:08:27.880 --> 0:08:31.720 the main question really is can divert really serious outcomes 0:08:31.760 --> 0:08:37.240 like death and hospitalizations. Epidemiologist Dr John Brownstein is also 0:08:37.280 --> 0:08:41.240 the Chief Innovation Officer at Boston Children's Hospital. Police in 0:08:41.240 --> 0:08:43.280 New York City are looking for a man they say 0:08:43.400 --> 0:08:46.360 is targeting homeless people in a string of stabbing attacks. 0:08:46.760 --> 0:08:49.199 The latest victim a twenty eight year old woman attacked 0:08:49.240 --> 0:08:52.200 early yesterday. Police say the same man can be seen 0:08:52.280 --> 0:08:55.839 on surveillance cameras in all three locations where homeless people 0:08:55.880 --> 0:08:58.440 have been stabbed in the last week. The first stabbing 0:08:58.600 --> 0:09:01.440 was on July thirty four year old man resting on 0:09:01.480 --> 0:09:04.040 a bench was stabbed and later died from his injuries. 0:09:04.360 --> 0:09:07.200 Three days later, a fifty nine year old homeless man 0:09:07.240 --> 0:09:11.200 was stabbed in the abdomen. Japanese people have bid their 0:09:11.240 --> 0:09:15.920 final goodbye the former Prime minister Shinzo abe. Family funeral 0:09:16.080 --> 0:09:19.240 was held at the Temple days after his assassination that 0:09:19.480 --> 0:09:23.000 shocked the nation. Abbe, the country's longest serving prime minister, 0:09:23.120 --> 0:09:26.240 was gunned down Friday during a campaign speech. The first 0:09:26.280 --> 0:09:30.400 image from NASA's News Space Telescope is the deepest view 0:09:30.480 --> 0:09:33.960 of the universe ever captured. The image from the James 0:09:33.960 --> 0:09:37.679 Webb Space Telescope was unveiled at the White House President 0:09:37.760 --> 0:09:41.319 Joe Biden. Light from the Oldest Galaxies, the oldest documented 0:09:41.400 --> 0:09:45.600 light in the history of the universe, from over thirteen 0:09:45.840 --> 0:09:49.880 billion let me say it again, thirteen billion years ago. Today, 0:09:50.000 --> 0:09:53.280 four more galactic shots will be released from the telescope. 0:09:53.480 --> 0:09:55.640 Global News twenty four hours a day on air and 0:09:55.840 --> 0:09:59.160 on Baloomberg Quick Take, powered by more than journalists and 0:09:59.160 --> 0:10:02.240 analysts and over a hundred twenty countries. Michael Barr and 0:10:02.280 --> 0:10:05.520 this is Bloomberg. Nay, such a cool picture. To thank you, Michael. 0:10:10.360 --> 0:10:12.400 Almost six ten on Wall Street. Let's check in with 0:10:12.480 --> 0:10:15.160 John Stanshar for the Bloomberg Sports update. All right, Nathan, 0:10:15.200 --> 0:10:18.320 the Mets pain max sers are forty three million dollars 0:10:18.320 --> 0:10:20.400 a year. They're doing that for games like last night 0:10:20.400 --> 0:10:23.280 in Atlanta. The Mets lead over the Braves once ten 0:10:23.320 --> 0:10:25.560 and a half games at Dwindle to one and a half, 0:10:25.559 --> 0:10:28.840 thanks to Atlanta's twenty nine and eight records. Since June one. 0:10:28.920 --> 0:10:30.720 They've got the best offense of the National League, but 0:10:30.760 --> 0:10:33.800 Scherzer shut them down, allowed only one hit over the 0:10:33.840 --> 0:10:36.080 first six and as he struck out nine shots are in. 0:10:36.080 --> 0:10:39.480 The Mets beat the Braves four to one, especially this 0:10:39.720 --> 0:10:41.800 time of year. Uh. You know, they're a great team 0:10:41.800 --> 0:10:43.360 over there, and you want to come out there and 0:10:43.400 --> 0:10:46.400 play your best baseball. Uh. And you know when you 0:10:46.400 --> 0:10:48.960 you can collect wins against them, and you know, it's 0:10:49.000 --> 0:10:50.800 kind of a measuring stick win and you know it's 0:10:50.960 --> 0:10:54.160 it's a good feeling. So um. You know, but like 0:10:54.200 --> 0:10:56.400 you said, we're in when getting game here in July, 0:10:56.559 --> 0:10:58.320 we gotta come out there and played, you know, great 0:10:58.400 --> 0:11:00.640 months of Jove. It's got a home for Luiski or 0:11:00.679 --> 0:11:02.960 Mayo rb I double from Pete Alonso. Pete will go 0:11:03.080 --> 0:11:05.520 for the home run derby three. Pete, he's never not 0:11:05.600 --> 0:11:07.880 one a winner the last two the Braves. Ronald the 0:11:07.960 --> 0:11:10.199 Cuna Jr. Will be one of his competitors next one 0:11:10.240 --> 0:11:11.960 day in l a lest of the Field. Not yet 0:11:11.960 --> 0:11:15.280 No Yankees Tonight host the Cincinnati Reds as the British 0:11:15.280 --> 0:11:18.560 Open gets ready to tee off Thursday. St Andrew's so 0:11:18.720 --> 0:11:20.840 much talk about the new Live tour word that the 0:11:20.920 --> 0:11:24.880 Anti Trust Division of the Justice Department is investigating whether 0:11:24.920 --> 0:11:29.400 the PGA Tour used anti competitive practices against the Live Tour. 0:11:29.480 --> 0:11:32.520 The PGA says it expected this and is confident there 0:11:32.559 --> 0:11:35.520 was no wrongdoing. The guys who jumped to Live Dustin 0:11:35.640 --> 0:11:38.960 Johnson Bryson, the Shambo Brooks captor. They are playing the 0:11:39.000 --> 0:11:43.280 Open Championship, as is Tiger Woods, John Stashanward, Bloomberg Sports name, 0:11:43.480 --> 0:11:46.480 thank you, John SMP futures down twenty two point, staff 0:11:46.480 --> 0:11:50.959 features down, nastac features down forty five. The dollar continuing 0:11:51.000 --> 0:11:53.480 to strengthen this morning. The euro hit parody against the 0:11:53.520 --> 0:11:57.000 dollar earlier this morning. Look at the impact what it 0:11:57.040 --> 0:11:59.920 means for markets. Jane Foley, head of f X strat 0:12:00.160 --> 0:12:03.880 just at Robbo Bank joins us. Next. This is Bloomberg 0:12:07.520 --> 0:12:09.959 Bloomberg eleven three oh weather partly Sunday today, chance for 0:12:10.000 --> 0:12:12.800 afternoon showers and storms. Some could be strong going up 0:12:12.800 --> 0:12:16.280 to near ninety sunshine near ninety tomorrow. Right now sixty 0:12:16.360 --> 0:12:24.160 nine degrees in Central Park. Markets, headlines and breaking news 0:12:24.240 --> 0:12:26.839 twenty four hours a day at Bloomberg dot Com, The 0:12:26.920 --> 0:12:31.040 Bloomberg Business Outland at Bloomberg Quick tape. He's a Bloomberg 0:12:31.120 --> 0:12:40.120 business flash and I'm Karen Moscow. We have some headlines 0:12:40.160 --> 0:12:43.520 crossing the Bloomberg Peloton Interactive to stop building its bikes 0:12:43.520 --> 0:12:46.719 and treadmills at its own factories and rely solely on 0:12:46.880 --> 0:12:50.040 partners for manufacturing, marking one of the most dramatic steps 0:12:50.080 --> 0:12:53.360 he had to simplify its operations and reduce costs. Shares 0:12:53.400 --> 0:12:56.439 her up in early training about eight tenths of a percent, 0:12:56.920 --> 0:12:59.640 also watching shares of PepsiCo, raising his outlook for the 0:12:59.679 --> 0:13:02.600 second time and as many quarters, saying it expects revenue 0:13:02.640 --> 0:13:05.840 to grow ten percent this year as consumer demand remains resilient. 0:13:06.200 --> 0:13:08.920 Those shares are up nine tenths of a percent this morning. 0:13:09.160 --> 0:13:12.040 Futures this morning are falling, with SNP futures down about 0:13:12.040 --> 0:13:14.280 twenty one points and down futures down a hundred eighty eight. 0:13:14.360 --> 0:13:17.600 Nastack features down forty four, the decks in Germany down 0:13:17.640 --> 0:13:19.839 seven tenths of up percent. The tend your treasury of 0:13:19.920 --> 0:13:22.400 twenty thirty seconds yield two point nine one percent. That 0:13:22.520 --> 0:13:25.400 yield on the two year is at three percent. Nieme 0:13:25.480 --> 0:13:27.760 X screwed oil down two point six percent on two 0:13:27.760 --> 0:13:30.439 dollars seventy three cents at a hundred one dollars thirty 0:13:30.440 --> 0:13:33.000 six cents of barrel. Comex school. This it will change 0:13:33.000 --> 0:13:36.320 is seventeen thirty two sixty announced. Now. The euro is 0:13:36.360 --> 0:13:38.840 at one point zero zero one six against the dollar, 0:13:39.080 --> 0:13:41.319 British found one point one eight four one and the 0:13:41.400 --> 0:13:44.720 yen one thirty six point eight nine Bitcoin this morning 0:13:44.720 --> 0:13:47.440 lower down three point six percent at nineteen thousand, six 0:13:47.520 --> 0:13:50.880 hundred seventy dollars. That's a Bloomberg business flash. Now here's 0:13:50.920 --> 0:13:53.600 Michael bar with more on what's going on around the world. 0:13:53.679 --> 0:13:56.520 Michael Karen, thank you very much. Another public hearing today 0:13:56.559 --> 0:14:01.200 behind the Congressional committee investigating the deadly January sixth insurrection. 0:14:01.640 --> 0:14:04.560 Is hearing will focus on the involvement of white supremacists 0:14:04.640 --> 0:14:07.560 hate groups in the attack on the Capitol and feature 0:14:07.600 --> 0:14:11.719 testimony by former White House Consul Pat Saboloni, whom investigators 0:14:11.720 --> 0:14:16.000 say collaborates former White House aid Cassidy Hutchinson. People in 0:14:16.080 --> 0:14:18.480 Japan have bid their final goodbye to former Prime Minister 0:14:18.520 --> 0:14:22.040 Shinzo Abe. Family funeral was held at the Temple days 0:14:22.080 --> 0:14:25.520 after his assassination that shocked the nation. In baseball, the 0:14:25.560 --> 0:14:28.560 Mets one the red sox, A's and giants lost. Global 0:14:28.560 --> 0:14:30.800 news twenty four hours a day on air and on 0:14:30.840 --> 0:14:34.560 Bloomberg Quick Take, powered by more than twenty hundred journalists 0:14:34.560 --> 0:14:37.320 and analysts more than a hundred twenty countries. Michael Barr 0:14:37.360 --> 0:14:40.080 and this is Bloomberg. Nathan all right, Michael, thank you. 0:14:40.120 --> 0:14:42.280 It is six nineteen on Wall Street Live from the 0:14:42.280 --> 0:14:45.920 Bloomberg Interactive Brokers studios. This is Bloomberg daybreaking as we 0:14:45.960 --> 0:14:49.240 continue to see stocks sell off this morning. A lot 0:14:49.280 --> 0:14:52.240 of this story has been the flights of safety. Bonds 0:14:52.320 --> 0:14:55.920 are on the rise, and the dollar continues to strengthen. 0:14:56.240 --> 0:14:59.600 Joining us more for more on the currency picture this morning, 0:14:59.640 --> 0:15:03.000 where and by Jane Foley, Executive director, head of FX 0:15:03.000 --> 0:15:06.040 Strategy at Robbo Bank. Jane, good morning. I know you've 0:15:06.080 --> 0:15:10.040 probably been watching very closely for euro dollar parody. We 0:15:10.160 --> 0:15:13.520 did reach it moments ago. It looks like the euro 0:15:13.680 --> 0:15:17.120 is starting to bounce back just a bit against the dollar. 0:15:17.360 --> 0:15:22.960 What does euro dollar parody mean for this market? Well, 0:15:23.040 --> 0:15:26.280 it's a big psychological level and probably a big level 0:15:26.280 --> 0:15:28.720 for the options market, but I think for the ECB 0:15:28.920 --> 0:15:32.480 also clearly, if you have a weeker year, then that's 0:15:32.520 --> 0:15:36.560 not particularly great for your inflation, particularly when you're importing 0:15:36.720 --> 0:15:38.920 a lot of energy, and of course energy is what 0:15:39.000 --> 0:15:42.400 this story is all about. Yesterday, as you'll be aware, 0:15:42.440 --> 0:15:45.400 we had the taking down of the nord Stream wine 0:15:45.760 --> 0:15:49.720 at one pipeline for cleaning, for maintenance, and politicians and 0:15:49.760 --> 0:15:54.320 speculators alike. Oh, I mean that Putin won't turn that 0:15:54.400 --> 0:15:57.080 pipeline back on a scheduled ininten days time, or at 0:15:57.120 --> 0:15:59.680 least if he does, then maybe it flows through. It 0:15:59.720 --> 0:16:02.040 will be lessons and then we'll have less gas in 0:16:02.080 --> 0:16:04.040 Europe for the winter, and then we'll have recessions. So 0:16:04.600 --> 0:16:09.600 really whether or not we can drop through parity very 0:16:09.640 --> 0:16:12.120 much depends on that decision that pipeline and what happens 0:16:12.120 --> 0:16:15.280 in ten days time with with Putin and and gas supply. 0:16:15.600 --> 0:16:18.160 So there is this risk of recession a bigger concern 0:16:18.240 --> 0:16:20.000 for the Eurozone than it is for the dollar, and 0:16:20.080 --> 0:16:23.080 your for the US and your view, yes, I think 0:16:23.080 --> 0:16:26.800 it is when we have been forecasting recession over this winter, 0:16:26.840 --> 0:16:28.760 for for the for the eurosin for it for a while, 0:16:28.840 --> 0:16:31.400 and I think perhaps more commentators have seen this. But 0:16:31.440 --> 0:16:35.080 it's very much dependent on energy, because if you got 0:16:35.080 --> 0:16:36.600 back just a couple of weeks ago we had the 0:16:36.600 --> 0:16:41.840 German Economy Minister warning that we could see rationing in 0:16:41.560 --> 0:16:44.000 in Germany and that would be amongst some of the 0:16:44.040 --> 0:16:49.680 big industrialized, hungry energy hungry UH companies, and that would 0:16:49.680 --> 0:16:52.360 be obviously to protect the gas supplies or the energy 0:16:52.360 --> 0:16:55.840 supplies for for consumers. And clearly if you had someone German, 0:16:55.960 --> 0:17:00.520 Germany's big energy being rationed in terms of energy, that's 0:17:00.520 --> 0:17:03.040 what would bring out slower growth and the recession risk. 0:17:03.120 --> 0:17:05.760 And you can translate that also to Italy, another big 0:17:05.800 --> 0:17:10.200 industrialized economy here here in Europe, and recession then would 0:17:10.200 --> 0:17:12.960 would highlight, as it always does in your highlight the 0:17:13.280 --> 0:17:16.879 differences between the Eurozone countries and focus on on the 0:17:16.960 --> 0:17:20.480 highly debted nations. And then we have more conversation around 0:17:20.520 --> 0:17:24.159 fragmentation and also how big a window does the ECB 0:17:24.320 --> 0:17:26.480 have too high interest rates? If if if there is 0:17:26.520 --> 0:17:29.120 this risk of recession going into the winter. So that's 0:17:29.240 --> 0:17:33.280 all combined into a negative scenario for for the euro 0:17:33.600 --> 0:17:36.840 at a time when safe haven flow is really supporting 0:17:36.880 --> 0:17:39.960 the dollar. Well, what are the options for the ECB 0:17:40.160 --> 0:17:44.320 at this point? Could we see intervention sooner to try 0:17:44.359 --> 0:17:47.399 to head off some of these concerns? Well, we're not 0:17:47.440 --> 0:17:50.480 going to see ext intervention, but we could, we could 0:17:50.520 --> 0:17:53.320 have intervention to try and store up confidence. And and 0:17:53.600 --> 0:17:55.600 this is this is where it gets very, very tricky 0:17:55.640 --> 0:17:58.920 for the ECB, because we have this higher inflation print. 0:17:59.000 --> 0:18:01.480 We know that they want to eve into this era 0:18:01.680 --> 0:18:04.760 of tighter monetary policy. They've already signaled that they'll be 0:18:04.840 --> 0:18:07.840 hiking interest rates twenty five basis points this month, maybe 0:18:07.880 --> 0:18:11.480 maybe to a fifty basis points in in September. But 0:18:11.560 --> 0:18:14.480 at the same time they're worried about fagmentation. They want 0:18:14.520 --> 0:18:19.280 to hold together market confidence and and that involves some 0:18:19.320 --> 0:18:24.159 degree of protection for these highly indebted countries, but in 0:18:24.200 --> 0:18:26.200 a way that goes against the grain. I mean, it's 0:18:26.200 --> 0:18:28.000 a bit about saying, well, yes, you know, we want 0:18:28.040 --> 0:18:31.200 to tighten monetary policy, but nobody can fail. And that 0:18:31.400 --> 0:18:34.640 is perhaps a little bit counterintuitive, and certainly it means 0:18:34.640 --> 0:18:39.080 it's a very tough line for the ECB to walk 0:18:39.160 --> 0:18:42.399 in terms of getting this policy right. And because of 0:18:42.400 --> 0:18:45.760 the complications for the ECB policy, again, you know, the 0:18:45.800 --> 0:18:49.280 market is looking at this and worried about this, and 0:18:49.280 --> 0:18:51.639 this is all weighing on the Euro. Only about thirty 0:18:51.640 --> 0:18:54.520 seconds left here, Jane but does a stronger dollar effect 0:18:54.560 --> 0:18:57.800 anything for the Fed? Well, it does. I mean a 0:18:57.840 --> 0:19:01.440 stronger policy is part of the mode a tree tightening policy. 0:19:01.480 --> 0:19:04.840 So you could say the more the dollar stensons, the 0:19:04.960 --> 0:19:07.680 less they already have to do in terms of actual 0:19:07.760 --> 0:19:10.760 policy measures. You could argue that a stronger dollars does 0:19:10.800 --> 0:19:13.440 some of the heavy lifting already, so orders play into 0:19:13.840 --> 0:19:16.600 how much the market is likely to forecast for interest 0:19:16.680 --> 0:19:19.560 rate hikes during the cycle. Thanks for this, Jane, great 0:19:19.600 --> 0:19:22.560 having you on with us this morning. Jane Folly, executive director, 0:19:22.880 --> 0:19:26.080 head of FX Strategy at Robo Bank, where a lot 0:19:26.119 --> 0:19:29.440 of the story this morning is euro dollar parody. Right now, 0:19:29.480 --> 0:19:32.520 the euro is trading at one point zero zero one 0:19:32.640 --> 0:19:35.520 seven against the dollar. We did hit parody between the 0:19:35.560 --> 0:19:39.240 year on the dollar earlier this morning. SMP futures are 0:19:39.320 --> 0:19:43.240 down nineteen points. Now futures are down two Nasdaq futures 0:19:43.240 --> 0:19:46.480 are lower by forty points, and we continue to watch 0:19:46.600 --> 0:19:50.040 inversion between two year and ten year yields. Right now, 0:19:50.080 --> 0:19:53.560 the tenure is up thirty seconds, with the yield almost 0:19:53.600 --> 0:19:57.000 two point nine one almost two point nine two percent. 0:19:57.040 --> 0:19:59.359 I should say it is at two point nine two uh. 0:19:59.560 --> 0:20:02.439 The two year yield is at three point zero zero percent. 0:20:03.000 --> 0:20:09.600 This is Bloomberg Bloomberg eleven three oh weather partly sunny, 0:20:09.600 --> 0:20:12.040 maybe some strong storms later this afternoon on our way 0:20:12.080 --> 0:20:15.440 ups in your ninety degrees high, your nineties sunshine Tomorrow 0:20:15.720 --> 0:20:18.480 could see an afternoon shower Thursday, right now seventy in 0:20:18.560 --> 0:20:26.160 Central Park. Broadcasting live from the Bloomberg Interactive Broker Studio 0:20:26.280 --> 0:20:29.440 in New York. Bloomberg E Loving Freedom to Washington, d C, 0:20:29.640 --> 0:20:33.320 Bloomberg N one to Boston, Bloomberg one O six one 0:20:33.440 --> 0:20:36.920 to San Francisco, Bloomberg nine sixt to the country Sirius 0:20:37.040 --> 0:20:40.240 XM Channel one nineteen and around the globe the Bloomberg 0:20:40.280 --> 0:20:44.720 Business and Bloomberg Radio dot com. This is Bloomberg Daybreak 0:20:50.600 --> 0:20:52.840 six thirty on Wall Street. Good morning, I'm Nathan Hagar 0:20:53.200 --> 0:20:55.680 and I'm Karen Moscow. We are just about three hours 0:20:55.720 --> 0:20:57.800 away from the open of US trading. Kind to the 0:20:57.840 --> 0:20:59.760 five things you need to know to start your day. 0:21:00.119 --> 0:21:03.840 To you buy Interacted Brokers. Interactive Brokers charges Martin loan 0:21:03.920 --> 0:21:06.520 rates from two point eight percent to three point eight percent, 0:21:06.880 --> 0:21:09.560 rates subject to change. Learn more at ibk R dot com. 0:21:09.600 --> 0:21:12.840 Slash Compare First U s futures are lower, adding to 0:21:12.960 --> 0:21:16.720 yesterday's losses, which saw all three major indexes slump. Mike 0:21:16.800 --> 0:21:19.640 vocal Sang, chief investment officer at cap Trust, says, at 0:21:19.640 --> 0:21:22.760 this point, it's unclear how markets are pricing in a recession. 0:21:23.200 --> 0:21:26.199 This recession has been so anticipated that it's far to 0:21:26.240 --> 0:21:28.760 believe the market hasn't discounted most of it. Maybe the 0:21:28.800 --> 0:21:31.399 surprise will be that it's that it's really really a 0:21:31.480 --> 0:21:34.320 negative and difficult and deep recession. We don't think so. 0:21:34.560 --> 0:21:36.760 It also could be that we don't really hit a recession. 0:21:36.760 --> 0:21:38.560 We're like a stone skipping off the top of the 0:21:38.600 --> 0:21:41.320 pond and moving on and back up again. That's the 0:21:41.400 --> 0:21:43.040 question I think, and I think we're going to know 0:21:43.119 --> 0:21:45.680 a lot more about that as we had into earning 0:21:45.680 --> 0:21:48.320 season later this week and then the next couple of weeks. 0:21:48.400 --> 0:21:51.280 Mike vocals Sang a capped Trust as forward guidance from 0:21:51.280 --> 0:21:53.959 companies will be watched closely over the next few weeks. Well. 0:21:53.960 --> 0:21:56.720 The Wall Street sell off spreading overseas. Karen Japan's NIEK 0:21:57.000 --> 0:21:59.720 and Hong Kong's Hang Sang Index both felt more than 0:21:59.760 --> 0:22:02.760 one percent overnight. I made concerns about inflation and COVID 0:22:02.800 --> 0:22:05.879 and China oil is moving lower to West Texas Intermediates 0:22:05.880 --> 0:22:07.480 down two and a half percent at a hundred one 0:22:07.560 --> 0:22:10.760 dollars forty six cents of barrel. Investors are looking ahead 0:22:10.760 --> 0:22:13.480