1
00:00:03,040 --> 00:00:06,520
Speaker 1: This is Bloomberg Daybreak Asia. It is Wednesday, February twenty

2
00:00:06,559 --> 00:00:09,800
Speaker 1: second in Hong Kong, Tuesday February twenty first in New

3
00:00:09,880 --> 00:00:12,800
Speaker 1: York and coming up today. US stocks sell off on

4
00:00:12,920 --> 00:00:16,000
Speaker 1: fears the FED isn't close to ending the tightening cycle.

5
00:00:16,280 --> 00:00:20,160
Speaker 1: Retail giants Walmart and Home Depot give gloomy profit forecasts

6
00:00:20,160 --> 00:00:22,720
Speaker 1: for the year ahead. Fears of a price war between

7
00:00:22,800 --> 00:00:26,599
Speaker 1: China's tech giants grows as Beijing wind's back it's crackdown

8
00:00:26,680 --> 00:00:30,000
Speaker 1: on the tech sector. Joe Biden and warsaws as Ukraine

9
00:00:30,040 --> 00:00:32,720
Speaker 1: will never fall and that Vladimir Putin has lost standing

10
00:00:32,720 --> 00:00:36,040
Speaker 1: in the world. Poutin backs away from arms control agreement,

11
00:00:36,320 --> 00:00:39,680
Speaker 1: reports that Shijianping plans to visit Moscow in coming months.

12
00:00:39,840 --> 00:00:45,280
Speaker 1: I'm at Baxter with Global News. That's all straight Ahead

13
00:00:45,320 --> 00:00:48,720
Speaker 1: on Bloomberg Daybreak Asia, the business news you need to

14
00:00:48,760 --> 00:00:52,400
Speaker 1: start your day in just one fifteen minute podcast available

15
00:00:52,440 --> 00:00:56,200
Speaker 1: on Apples, Spotify, the Bloomberg Business app and everywhere you

16
00:00:56,240 --> 00:01:02,360
Speaker 1: get your podcasts. Good morning, I'm Dead Prisoner and I'm

17
00:01:02,360 --> 00:01:06,319
Speaker 1: Brian Curtis. Here are the stories we're following today. Traders

18
00:01:06,319 --> 00:01:09,120
Speaker 1: will be looking to Wednesday's FED minutes for clues on

19
00:01:09,160 --> 00:01:12,039
Speaker 1: the Central Bank's rate hiking path, Let's get that story

20
00:01:12,080 --> 00:01:15,200
Speaker 1: from Bloomberg's Michael McKee. The surprise is gone now that

21
00:01:15,240 --> 00:01:17,840
Speaker 1: the presidents of the Cleveland and Saint Louis fedbanks have

22
00:01:17,920 --> 00:01:20,399
Speaker 1: said they saw a case for a half percentage point

23
00:01:20,440 --> 00:01:23,080
Speaker 1: increase at the February first meeting. If there were a

24
00:01:23,080 --> 00:01:25,800
Speaker 1: significant number of others who felt the same way, that

25
00:01:25,920 --> 00:01:28,520
Speaker 1: could influence views of the Fed's next move, given the

26
00:01:28,560 --> 00:01:31,680
Speaker 1: strong data we've seen since then. Moreover, at his post

27
00:01:31,720 --> 00:01:35,200
Speaker 1: meeting news conference, FED Chair j Powell teased a discussion

28
00:01:35,280 --> 00:01:38,080
Speaker 1: on the path forward for rates that we'd learn about

29
00:01:38,080 --> 00:01:40,440
Speaker 1: when the minutes were released. What might have been said

30
00:01:40,480 --> 00:01:43,080
Speaker 1: about how high rates will need to go, how fast,

31
00:01:43,319 --> 00:01:45,639
Speaker 1: and for how long. A lot of that will depend

32
00:01:45,680 --> 00:01:48,520
Speaker 1: on how FED officials felt about the prospects for inflation.

33
00:01:48,920 --> 00:01:52,520
Speaker 1: Another discussion to watch in the minutes, Michael McKee, Bloomberg

34
00:01:52,600 --> 00:01:56,280
Speaker 1: Daybreak Asia. So onto the big retailers. We begin with Walmart.

35
00:01:56,360 --> 00:01:59,600
Speaker 1: The company reported sales and profit above expectations for the

36
00:01:59,680 --> 00:02:03,360
Speaker 1: last quarter. Shoppers appeared to flock to those stores during

37
00:02:03,360 --> 00:02:06,640
Speaker 1: the holiday season to take advantage of Walmart's low prices.

38
00:02:06,640 --> 00:02:09,920
Speaker 1: Even so, the retail giant warned of tougher times ahead.

39
00:02:10,400 --> 00:02:15,239
Speaker 1: Walmart is now forecasting a second straight decline in annual profit. Here,

40
00:02:15,240 --> 00:02:18,839
Speaker 1: as the company's chief financial officer, John David Rainey, you're

41
00:02:18,840 --> 00:02:22,480
Speaker 1: seeing that our value proposition and certainly resonating with consumers

42
00:02:22,560 --> 00:02:25,720
Speaker 1: right now. But there's a lot of macro uncertainty again

43
00:02:25,760 --> 00:02:30,040
Speaker 1: as we look across the consumers across the globe, but

44
00:02:30,120 --> 00:02:33,400
Speaker 1: certainly here in the US, balance sheets are getting thinner.

45
00:02:33,480 --> 00:02:36,000
Speaker 1: You're seeing savings rates decline, and we really haven't been

46
00:02:36,040 --> 00:02:38,560
Speaker 1: in a position where we've seen the FED tighten at

47
00:02:38,600 --> 00:02:41,200
Speaker 1: this rate. And so as we look forward and give

48
00:02:41,200 --> 00:02:44,080
Speaker 1: guidance for the full year, we're adopting a cautious outlook

49
00:02:44,120 --> 00:02:46,360
Speaker 1: and we want to make sure that we're responsive to

50
00:02:46,400 --> 00:02:48,959
Speaker 1: whatever environment that we're going to find ourselves at. John

51
00:02:49,040 --> 00:02:53,040
Speaker 1: David Rainey, there, the CFO of Walmart. The news wasn't

52
00:02:53,080 --> 00:02:55,960
Speaker 1: a lot better for Home Depot, the home improvement retailers

53
00:02:56,000 --> 00:02:59,040
Speaker 1: now forecasting a profit decline for the full year. The

54
00:02:59,080 --> 00:03:02,560
Speaker 1: companies cited certainty tied to those higher interest rates now.

55
00:03:02,600 --> 00:03:06,560
Speaker 1: Home Depot said that could keep Americans from moving and

56
00:03:06,960 --> 00:03:10,680
Speaker 1: renovating their homes. Bryan Companies in China and around the

57
00:03:10,680 --> 00:03:12,919
Speaker 1: world have been warned that they will be punished by

58
00:03:12,960 --> 00:03:15,520
Speaker 1: the US if they keep doing business with Russia. That

59
00:03:15,600 --> 00:03:18,639
Speaker 1: story from Bloomberg's and Kates. The Treasury Department says the

60
00:03:18,680 --> 00:03:21,919
Speaker 1: cost of violating the Biden administration's sanctions against Moscow will

61
00:03:21,960 --> 00:03:24,720
Speaker 1: be steep, and that corporations and banks risk being cut

62
00:03:24,720 --> 00:03:27,560
Speaker 1: off from the US at its partner's financial systems. A

63
00:03:27,639 --> 00:03:30,760
Speaker 1: year after Vladimir Putin invaded Ukraine, the sanctions have had

64
00:03:30,800 --> 00:03:34,000
Speaker 1: a devastating impact on Russia's gas exports and imports of

65
00:03:34,080 --> 00:03:36,560
Speaker 1: high tech goods, but they have yet to seriously diminish

66
00:03:36,600 --> 00:03:40,280
Speaker 1: Putin's ability to wage war. In Washington and Kate's Bloomberg

67
00:03:40,360 --> 00:03:43,240
Speaker 1: Daybreak Asia, the big tech firms in China appear to

68
00:03:43,240 --> 00:03:45,480
Speaker 1: be on the verge of a price war. We have

69
00:03:45,560 --> 00:03:48,800
Speaker 1: that story from Bloomberg's Von Men. China's internet and e

70
00:03:48,920 --> 00:03:52,040
Speaker 1: commerce firms are beaving up efforts to outdo each other.

71
00:03:52,520 --> 00:03:55,480
Speaker 1: Media reports suggested jad dot Com was planning a one

72
00:03:55,520 --> 00:03:59,280
Speaker 1: point five billion dollars subsidy campaign to compete against Ping

73
00:03:59,360 --> 00:04:03,000
Speaker 1: Dual Door. Elsewhere, net Ees and miHoYo are upping their

74
00:04:03,000 --> 00:04:07,640
Speaker 1: battle against gaming leader ten Cent as competition rises, concerns

75
00:04:07,640 --> 00:04:12,080
Speaker 1: over margins grow, and equity investors have taken notice. JDM

76
00:04:12,080 --> 00:04:15,360
Speaker 1: Pingdodo fell ten to eleven percent in New York and

77
00:04:15,400 --> 00:04:18,920
Speaker 1: Ali Baba was down nearly five percent. The selling helped

78
00:04:18,960 --> 00:04:22,440
Speaker 1: push the NASDA Golden Dragon China Index down two point

79
00:04:22,520 --> 00:04:26,520
Speaker 1: nine percent in Hong Kong. I'm Ivan Mann Bloomberg Daybreak Asia.

80
00:04:27,000 --> 00:04:30,120
Speaker 1: Microsoft is promising that Call of Duty will not be

81
00:04:30,240 --> 00:04:32,800
Speaker 1: collateral damage as it tries to get approval for its

82
00:04:32,800 --> 00:04:37,080
Speaker 1: planned purchase of Activision Blizzard. The story from Bloomberg's Denise Pellegrini.

83
00:04:37,279 --> 00:04:41,039
Speaker 1: Britain's anti trust watchdog has suggested Microsoft agree to divest

84
00:04:41,120 --> 00:04:44,160
Speaker 1: Call of Duty to deflect criticism that buying its owner

85
00:04:44,200 --> 00:04:47,520
Speaker 1: Activision would stifle competition. But Call of Duty is one

86
00:04:47,560 --> 00:04:50,680
Speaker 1: of the most lucrative game franchises in the world, and

87
00:04:50,760 --> 00:04:54,520
Speaker 1: speaking after a European Union hearing, Microsoft president Brad Smith said,

88
00:04:54,720 --> 00:04:57,960
Speaker 1: no way. We don't see a viable path to sell

89
00:04:58,120 --> 00:05:01,640
Speaker 1: off the part of this company, Activision Blizzard that makes

90
00:05:01,680 --> 00:05:04,120
Speaker 1: Call of Duty. Microsoft did manage to flying two more

91
00:05:04,120 --> 00:05:06,880
Speaker 1: opponents of the merger today. It cut deals sharing Call

92
00:05:06,960 --> 00:05:09,599
Speaker 1: of Duty with Nintendo and also in Vidia's chief force

93
00:05:09,800 --> 00:05:12,479
Speaker 1: in addition to the antitrust concerns in Europe. Here in

94
00:05:12,520 --> 00:05:15,480
Speaker 1: the US, the FTC has already sued to block microsoft

95
00:05:15,560 --> 00:05:19,040
Speaker 1: sixty nine billion dollars deal. Denise Pelligriny Bloomberg day Breakasia.

96
00:05:20,000 --> 00:05:23,240
Speaker 1: I'm Brian Curtis, along with Doug Krisner and Rashad Salamat

97
00:05:23,279 --> 00:05:26,640
Speaker 1: will join us in a few moments. Now it's time

98
00:05:26,640 --> 00:05:31,039
Speaker 1: for Global News. The US President Joe Biden marking the

99
00:05:31,040 --> 00:05:34,200
Speaker 1: one year anniversary of Russia's invasion in Ukraine by saying

100
00:05:34,200 --> 00:05:38,000
Speaker 1: that Vladimir Putin will never find victory. Ed Baxter has

101
00:05:38,000 --> 00:05:40,800
Speaker 1: Global News in the nine sixty news room. Ed. Yeah,

102
00:05:40,880 --> 00:05:44,040
Speaker 1: that's exactly right, Brian Biden, in fact, saying, rather than

103
00:05:44,120 --> 00:05:48,120
Speaker 1: gating power and control, Putin's lost power and global standing,

104
00:05:48,320 --> 00:05:51,159
Speaker 1: President Putinsk front it was something today that you didn't

105
00:05:51,160 --> 00:05:55,240
Speaker 1: think was possible a year ago. The democracy of the world.

106
00:05:55,320 --> 00:06:00,320
Speaker 1: I've grown stronger, not weaker, But the autocrat to the

107
00:06:00,360 --> 00:06:03,400
Speaker 1: world have grown weaker, not stronger. And a message to

108
00:06:03,560 --> 00:06:07,000
Speaker 1: NATO there should be no doubt our support. Free grain

109
00:06:07,080 --> 00:06:10,440
Speaker 1: will not waiver, NATO will not be divided, and we

110
00:06:10,440 --> 00:06:13,839
Speaker 1: will not tire. Now, Biden, aiming for the Russian people,

111
00:06:13,920 --> 00:06:16,680
Speaker 1: saying the US and Europe do not seek to destroy

112
00:06:16,839 --> 00:06:20,279
Speaker 1: or control Russia. But freedom. There is no sweeter word

113
00:06:20,520 --> 00:06:24,520
Speaker 1: than freedom. There's no nobler goal than freedom. There's no

114
00:06:24,640 --> 00:06:28,040
Speaker 1: higher aspiration than freedom, and that the US will not

115
00:06:28,120 --> 00:06:32,080
Speaker 1: allow a Russian victory in Ukraine. Bloomberg's Amory horndern in

116
00:06:32,240 --> 00:06:36,080
Speaker 1: Warsaw says, a unifying message for NATO was followed a

117
00:06:36,120 --> 00:06:39,120
Speaker 1: message to the Polish people as well as these neighbor

118
00:06:39,240 --> 00:06:43,800
Speaker 1: neighboring countries around Ukraine was about this ironclad commitment to

119
00:06:44,120 --> 00:06:47,280
Speaker 1: Article five. This is something that would be very much

120
00:06:47,279 --> 00:06:50,800
Speaker 1: so welcomed by the Polish people. Yeah, and NATO countries

121
00:06:50,839 --> 00:06:53,440
Speaker 1: defending each other if under attack. Now, Earlier in the day,

122
00:06:53,520 --> 00:06:57,400
Speaker 1: Vladimir Putin pulled out participation in the nuclear agreement. He

123
00:06:57,480 --> 00:06:59,560
Speaker 1: threatened that there would be a response if the US

124
00:06:59,560 --> 00:07:02,680
Speaker 1: were to get long range missiles. We've seen throughout the

125
00:07:02,720 --> 00:07:06,080
Speaker 1: prior twelve months a little bit of hesitation from the West,

126
00:07:06,120 --> 00:07:09,560
Speaker 1: whether it was high Mars or another advance on a

127
00:07:09,680 --> 00:07:13,000
Speaker 1: military system. Now, Putin did say he would abide by

128
00:07:13,240 --> 00:07:16,920
Speaker 1: weapons limits, and the US is providing Ukraine long range

129
00:07:17,000 --> 00:07:20,560
Speaker 1: GPS guided bomb made by Boeing that is capable of

130
00:07:20,640 --> 00:07:24,880
Speaker 1: hitting targets forty five minutes away, and in the same

131
00:07:24,920 --> 00:07:28,560
Speaker 1: train of thought, China's President Hijunpeng is preparing to visit

132
00:07:28,640 --> 00:07:32,040
Speaker 1: Moscow for a summit with Vladimir Putin and coming months.

133
00:07:32,280 --> 00:07:35,600
Speaker 1: Wall Street Journals saying probably in late spring or early summer.

134
00:07:35,920 --> 00:07:38,880
Speaker 1: The story says that she will push for multi party

135
00:07:38,920 --> 00:07:42,240
Speaker 1: talks on peace in Ukraine and to reiterate what it

136
00:07:42,280 --> 00:07:46,000
Speaker 1: calls no nuclear weapons be used, and China's foreign ministers

137
00:07:46,080 --> 00:07:50,640
Speaker 1: urging the world to stop drawing parallels between Ukraine and Taiwan.

138
00:07:51,040 --> 00:07:54,240
Speaker 1: The statement urges countries to stop fueling the fire and

139
00:07:54,880 --> 00:07:58,720
Speaker 1: stop shifting blame to China and stop touting Ukraine today

140
00:07:59,000 --> 00:08:03,160
Speaker 1: Taiwan tomorrow. In the US, the Supreme Court Justice is

141
00:08:03,200 --> 00:08:07,400
Speaker 1: expressing awareness about opening Internet companies to lawsuits coming from

142
00:08:07,440 --> 00:08:11,280
Speaker 1: harmful user posts. The issue is whether Section two thirty

143
00:08:11,360 --> 00:08:17,200
Speaker 1: would be weakened, potentially opening the floodgates two lawsuits. Global

144
00:08:17,200 --> 00:08:19,680
Speaker 1: News powered by more than twenty seven hundred journalists and

145
00:08:19,680 --> 00:08:22,840
Speaker 1: analysts and over one hundred and twenty countries. In San Francisco,

146
00:08:22,920 --> 00:08:26,760
Speaker 1: I'm at Baxter and this is Bloomberg. This is Bloomberg Daybreakcasia,

147
00:08:26,800 --> 00:08:30,200
Speaker 1: Brian Curtis and Rashad Salamat, and our guest is Schoo,

148
00:08:30,360 --> 00:08:35,120
Speaker 1: financial advisor and managing director at UBS. So the short

149
00:08:35,240 --> 00:08:38,800
Speaker 1: end of the yield curve back to the yearly highs

150
00:08:38,920 --> 00:08:42,160
Speaker 1: of four point seven two percent, the long end not

151
00:08:42,400 --> 00:08:46,199
Speaker 1: quite buying in yet to the idea that yields to

152
00:08:46,200 --> 00:08:48,880
Speaker 1: a race to the upside. The high there was four

153
00:08:48,920 --> 00:08:51,480
Speaker 1: and a quarter and we're at three ninety five. But

154
00:08:51,520 --> 00:08:53,600
Speaker 1: the stock market feels like it's cracking now do you

155
00:08:53,640 --> 00:08:57,680
Speaker 1: agree with that? Well, you know, we always thought that

156
00:08:57,720 --> 00:09:02,680
Speaker 1: the rally this year it's not as sustainable, um, because

157
00:09:02,720 --> 00:09:06,000
Speaker 1: inflation is not completely under control. Uh. I mean, it's

158
00:09:06,040 --> 00:09:08,720
Speaker 1: still far from the said target two percent. So the

159
00:09:08,800 --> 00:09:13,160
Speaker 1: latest UH data suggesting is too early to expect as

160
00:09:13,840 --> 00:09:17,160
Speaker 1: pivot from the said and raped may stay higher for longer.

161
00:09:17,520 --> 00:09:20,320
Speaker 1: So um, you know. And it was great that the

162
00:09:20,320 --> 00:09:23,280
Speaker 1: speed of the rally of the year was was very fast,

163
00:09:23,320 --> 00:09:26,559
Speaker 1: but it's probably going to slow down a bit until

164
00:09:26,640 --> 00:09:31,520
Speaker 1: we have inflation more under control. This is it isn't

165
00:09:31,520 --> 00:09:33,880
Speaker 1: as year, But I mean the point being, do we

166
00:09:34,000 --> 00:09:36,880
Speaker 1: have to now wait? Really full a semblance of perhaps

167
00:09:36,960 --> 00:09:39,320
Speaker 1: calm well could be the other way round, of course,

168
00:09:39,520 --> 00:09:44,600
Speaker 1: until the FIRMC minutes. Yes, I mean, I think it's

169
00:09:46,080 --> 00:09:50,280
Speaker 1: we're always invested. I mean we're not going to wait

170
00:09:50,320 --> 00:09:54,120
Speaker 1: any you know, connected on the sidelines, but you know,

171
00:09:54,440 --> 00:09:56,760
Speaker 1: until we have that or data, until inflation is more

172
00:09:56,840 --> 00:09:59,800
Speaker 1: under control. Uh, you know, we have our portfolio pretty

173
00:09:59,840 --> 00:10:03,600
Speaker 1: well that vertified um and and kind of just see

174
00:10:03,679 --> 00:10:06,480
Speaker 1: what will happen with inflation, if that's going to eventually

175
00:10:06,520 --> 00:10:10,440
Speaker 1: be eventually going to modoring. It would feel almost like

176
00:10:10,480 --> 00:10:13,800
Speaker 1: this is a great time for some equity investors in

177
00:10:13,920 --> 00:10:16,960
Speaker 1: that when interest rates are close to zero, you know,

178
00:10:17,000 --> 00:10:19,400
Speaker 1: everybody can get into business, and you know, you can

179
00:10:19,400 --> 00:10:22,120
Speaker 1: be a disruptor pretty easily because the cost of capital

180
00:10:22,200 --> 00:10:26,280
Speaker 1: is is nothing. Now it's much more difficult. So if

181
00:10:26,280 --> 00:10:29,960
Speaker 1: you're a company that has an entrenched position, is this

182
00:10:30,040 --> 00:10:34,000
Speaker 1: a good time? Yes, I mean, this is definitely a

183
00:10:34,000 --> 00:10:37,320
Speaker 1: good time to be very selective. And you're absolutely right

184
00:10:37,400 --> 00:10:40,240
Speaker 1: with you know, rates or at zero, anybody can get

185
00:10:40,320 --> 00:10:43,120
Speaker 1: into business. But uh, you know, and that's why we're

186
00:10:43,200 --> 00:10:47,960
Speaker 1: very very selective with equity opportunities um and, Uh, you know,

187
00:10:48,000 --> 00:10:53,120
Speaker 1: we still prefer defensive, value oriented stocks, but of course

188
00:10:53,160 --> 00:10:57,199
Speaker 1: there's always opportunities in in uh, you know, consumer stables

189
00:10:57,240 --> 00:11:00,320
Speaker 1: and healthcare still just a bigger trend for those those

190
00:11:00,360 --> 00:11:04,400
Speaker 1: type of sectors are good and in including very selective

191
00:11:04,760 --> 00:11:08,920
Speaker 1: technology stocks as well. Tell me here as well, you

192
00:11:08,920 --> 00:11:11,120
Speaker 1: know you under preferred to should say if you at

193
00:11:11,160 --> 00:11:14,559
Speaker 1: least prefer the financial technology. No, financials shortly should be

194
00:11:14,600 --> 00:11:16,680
Speaker 1: doing better than what they are, given that we have

195
00:11:17,200 --> 00:11:20,000
Speaker 1: at least now interest rates as opposed to zero and

196
00:11:20,280 --> 00:11:23,079
Speaker 1: tech because well we've got to beaten down so much

197
00:11:23,160 --> 00:11:27,920
Speaker 1: last year, right, Yeah, absolutely, I think our concern with

198
00:11:28,040 --> 00:11:31,120
Speaker 1: financials is the recession risks. I mean, of course a

199
00:11:31,120 --> 00:11:33,160
Speaker 1: lot of people took that off the table, a lot

200
00:11:33,200 --> 00:11:37,000
Speaker 1: of investors. But if unemployment rate rises, earnings will take

201
00:11:37,040 --> 00:11:39,960
Speaker 1: a hit. And additionally, thanks apodit rates are rising, which

202
00:11:40,000 --> 00:11:44,040
Speaker 1: could criminate interest income growth. So we are careful on

203
00:11:44,120 --> 00:11:49,000
Speaker 1: financials and also still very careful on technology because you know,

204
00:11:49,080 --> 00:11:52,320
Speaker 1: if that is going to continue to raise rates, even

205
00:11:52,320 --> 00:11:54,559
Speaker 1: if it's at a slower pace, there's a greater potential

206
00:11:54,559 --> 00:11:57,319
Speaker 1: for a drag for growth sectors, and that includes technology

207
00:11:57,320 --> 00:11:59,800
Speaker 1: as well. What do you make of the price wars

208
00:11:59,840 --> 00:12:04,760
Speaker 1: now in Chinese technology companies, particularly internet and e commerce firms.

209
00:12:05,360 --> 00:12:07,880
Speaker 1: It seems like a new wrinkle that now all of

210
00:12:07,920 --> 00:12:10,880
Speaker 1: a sudden. We have to worry about their their margins.

211
00:12:10,920 --> 00:12:17,240
Speaker 1: And this has nothing to do with regulation, right absolutely. UM,

212
00:12:17,360 --> 00:12:21,160
Speaker 1: I think with China it's you know, the prize wars

213
00:12:21,200 --> 00:12:24,560
Speaker 1: are inevitable. I mean, it's going, it's going to happen.

214
00:12:24,960 --> 00:12:30,160
Speaker 1: But and but we're still very positive in China despite

215
00:12:30,160 --> 00:12:33,760
Speaker 1: the reason equity setback. We do feel like you know,

216
00:12:33,800 --> 00:12:37,480
Speaker 1: with the reason reopening in China. You know, we're very

217
00:12:37,520 --> 00:12:41,880
Speaker 1: preferred on emerging market equities. UH, specifically within Chinese equities,

218
00:12:41,880 --> 00:12:45,560
Speaker 1: we like direct beneficiaries of reopening and not include sectors

219
00:12:45,559 --> 00:12:50,360
Speaker 1: such as pharmaceuticals, medical equipment, and transportation. Um. Internet is good.

220
00:12:50,360 --> 00:12:52,880
Speaker 1: There is a prize war. Um, there's gonna be winners

221
00:12:52,880 --> 00:12:55,719
Speaker 1: and losers. So it's just you have to be I mean,

222
00:12:55,720 --> 00:12:58,280
Speaker 1: investors have to be very selective. You're going to get

223
00:12:58,320 --> 00:13:01,160
Speaker 1: into Internet. But we still for more of the direct

224
00:13:01,240 --> 00:13:06,320
Speaker 1: reopening beneficiaries and China is still our most preferred Asia

225
00:13:06,440 --> 00:13:09,520
Speaker 1: strategy right now. Tell me something though, you mean you

226
00:13:09,559 --> 00:13:11,719
Speaker 1: do with a lot of the high net worth individuals

227
00:13:12,520 --> 00:13:15,240
Speaker 1: in US, Hong Kong and China here as well, can

228
00:13:15,240 --> 00:13:17,920
Speaker 1: you tell me how that mood has changed in recent months,

229
00:13:18,040 --> 00:13:21,600
Speaker 1: especially since the reopening and number two, What is the

230
00:13:21,600 --> 00:13:27,000
Speaker 1: biggest the most common question they're asking you. Yes, I mean,

231
00:13:27,240 --> 00:13:30,079
Speaker 1: this is really a good question. I mean, I think

232
00:13:30,280 --> 00:13:35,560
Speaker 1: high net worth investors are definitely more optimistic this year.

233
00:13:35,640 --> 00:13:39,200
Speaker 1: I mean, last year was mostly every you know, a

234
00:13:39,200 --> 00:13:43,000
Speaker 1: lot more conservative, a lot of more cash management. Investors

235
00:13:43,000 --> 00:13:45,800
Speaker 1: are afraid to put cash awarp because they were just

236
00:13:45,840 --> 00:13:50,160
Speaker 1: so much uncertainty. But this year especially seen inflation, even

237
00:13:50,200 --> 00:13:53,120
Speaker 1: though it's still high, the moderate a bit, seeing that

238
00:13:53,160 --> 00:13:57,280
Speaker 1: the economy is still intact in China's reopening, that that

239
00:13:57,400 --> 00:14:02,800
Speaker 1: provided more certainty than before. So investors are more optimistic

240
00:14:02,880 --> 00:14:05,199
Speaker 1: in in putting a little bit more cash to work,

241
00:14:05,880 --> 00:14:08,840
Speaker 1: but still very very cautious because there's still a lot

242
00:14:08,840 --> 00:14:14,160
Speaker 1: of uncertainty out there. And in terms of you know,

243
00:14:14,200 --> 00:14:18,679
Speaker 1: just investors top question on their mind, it's still you know,

244
00:14:19,240 --> 00:14:21,840
Speaker 1: the lag effect of the ray heikes. You know, the

245
00:14:21,880 --> 00:14:24,560
Speaker 1: investors are very worried about if there's going to if

246
00:14:24,600 --> 00:14:27,520
Speaker 1: this is going to drag out, if a recession could

247
00:14:27,560 --> 00:14:31,160
Speaker 1: still happen. So I think, you know, there's that optimism,

248
00:14:31,200 --> 00:14:34,640
Speaker 1: but there's also a lot of caution as well. But overall,

249
00:14:35,320 --> 00:14:37,880
Speaker 1: there's more cash put to work this year than than

250
00:14:38,000 --> 00:14:41,200
Speaker 1: the day last year, we've burned off a lot of

251
00:14:41,200 --> 00:14:45,160
Speaker 1: the froth. I suppose in some of the equity markets.

252
00:14:45,200 --> 00:14:47,760
Speaker 1: Interesting that the DAO is now negative for the year.

253
00:14:48,040 --> 00:14:51,080
Speaker 1: The Nasdaq is still up about ten percent. Do you

254
00:14:51,440 --> 00:14:54,320
Speaker 1: expect I mean, if you're looking now at say the

255
00:14:54,360 --> 00:14:57,120
Speaker 1: next six months or so, is the dividing line whether

256
00:14:57,200 --> 00:15:00,240
Speaker 1: or not we go into recession or not or what's

257
00:15:00,280 --> 00:15:04,440
Speaker 1: the main dividing line? Um. I think it's whether we

258
00:15:04,560 --> 00:15:07,560
Speaker 1: go into recession. And I think the biggest dividing line

259
00:15:07,800 --> 00:15:10,440
Speaker 1: it would be, you know, the said policy if said

260
00:15:10,560 --> 00:15:13,600
Speaker 1: is going to continue to high rates, because a lot

261
00:15:13,640 --> 00:15:16,440
Speaker 1: of the rally was driven this year because there's that

262
00:15:16,560 --> 00:15:19,440
Speaker 1: optimism that ray hikes are going to slow down or

263
00:15:19,440 --> 00:15:21,920
Speaker 1: it's going to stop, and but now you know, it's

264
00:15:21,960 --> 00:15:25,880
Speaker 1: kind of reality hits that it didn't. Inflation still not

265
00:15:26,000 --> 00:15:29,080
Speaker 1: under control and said it is very likely and actually

266
00:15:29,320 --> 00:15:32,680
Speaker 1: stress the fact that they are going to hips are essential.

267
00:15:33,040 --> 00:15:37,000
Speaker 1: So there's I mean that greer potential draft for growth sectors.

268
00:15:37,080 --> 00:15:40,040
Speaker 1: So yeah, you know that we have most of the concern.

269
00:15:41,160 --> 00:15:44,040
Speaker 1: This is Bloomberg Daybreak, Gasia, your morning brief on this

270
00:15:44,160 --> 00:15:47,040
Speaker 1: story is making news from Hong Kong to Singapore and

271
00:15:47,200 --> 00:15:50,160
Speaker 1: Wall Street look for us on your podcast feed every day,

272
00:15:50,400 --> 00:15:54,080
Speaker 1: on Apple, Spotify, and anywhere else you get your podcasts.

273
00:15:54,280 --> 00:15:56,960
Speaker 1: You can also listen live each day on Bloomberg eleven

274
00:15:57,000 --> 00:15:59,600
Speaker 1: three zero in New York, Bloomberg ninety nine one and

275
00:15:59,680 --> 00:16:02,920
Speaker 1: wash Ington, Bloomberg one oh sixty one in Boston, and

276
00:16:02,960 --> 00:16:06,800
Speaker 1: Bloomberg nine sixty in San Francisco. Our flagship New York

277
00:16:06,840 --> 00:16:10,640
Speaker 1: station is also available on your Amazon Alexa devices. Just

278
00:16:10,920 --> 00:16:14,720
Speaker 1: say Alexa play Bloomberg eleven thirty plus listen coast to

279
00:16:14,760 --> 00:16:18,880
Speaker 1: coast on the Bloomberg Business app, Sirius XM Channel one nineteen,

280
00:16:19,280 --> 00:16:23,160
Speaker 1: the iHeartRadio app, and on Bloomberg dot Com. I'm Brian

281
00:16:23,240 --> 00:16:26,080
Speaker 1: Curtis and I'm Doug Prisoner. Join us again tomorrow for

282
00:16:26,120 --> 00:16:28,800
Speaker 1: all the news unique to start your day right here

283
00:16:28,880 --> 00:16:32,800
Speaker 1: on Bloomberg day Break Asia