WEBVTT - Bloomberg Daybreak: October 25, 2022 - Hour 1 (Radio) 0:00:03.000 --> 0:00:06.240 Live from the Bloomberg Interactive Berger Studios. Is this Bloomberg 0:00:06.320 --> 0:00:10.200 day Break for Tuesday, October two coming up this hour. 0:00:10.520 --> 0:00:13.600 Stocks are steady as investors await an onslaught of big 0:00:13.640 --> 0:00:16.960 tech earnings. UBS shares gain the most since June. We'll 0:00:16.960 --> 0:00:20.079 talk with the Banks CEO Rieshi Sunak is set to 0:00:20.079 --> 0:00:22.960 become the UK's third prime minister in his many months, 0:00:23.079 --> 0:00:25.720 and Adidas is set to cut ties with Kanye West 0:00:25.880 --> 0:00:28.840 and rest in an attack in the New York subway system. Plus, 0:00:28.880 --> 0:00:32.600 it's debate night for Democratic Governor hokel and a Republican 0:00:32.680 --> 0:00:36.960 challenger Lees heldon. I'm Michael Barr. More ahead, I'm John Stash. Sports. 0:00:36.960 --> 0:00:39.680 The Knicks bat Orlando. The next lost in Memphis. The 0:00:39.720 --> 0:00:45.000 Bears beat the Patriots in Monday Night Football. That's All's 0:00:45.000 --> 0:00:48.680 trading ahead on Bloomberg day Break on Bloomberg Eliven Free 0:00:48.680 --> 0:00:51.920 on New York, Bloomberg ninety nine one, Washington, d C, 0:00:52.400 --> 0:00:56.680 Bloomberg one oh six one, Boston, Bloomberg nine sixties, San Francisco, 0:00:57.160 --> 0:00:59.920 Syrius x AM one nine team, and around the world 0:01:00.160 --> 0:01:03.640 on Bloomberg Radio dot Com and via the Bloomberg business Side. 0:01:07.640 --> 0:01:10.840 Good morning, I'm Nathan Hager and I'm Karen Moscow. US 0:01:10.880 --> 0:01:13.920 stock index futures are lower this morning. We're coming up 0:01:13.920 --> 0:01:15.479 to five oh one on Wall Street, and we check 0:01:15.520 --> 0:01:18.160 the markets every fifteen minutes throughout the trading day. On 0:01:18.240 --> 0:01:21.160 Bloomberg S and P Future is down about nine points down, 0:01:21.200 --> 0:01:25.160 futures down eighty Nastack futures down thirteen. The decks in 0:01:25.240 --> 0:01:28.919 Germany's down half percent, CAC in Paris up three tenths percent, 0:01:28.959 --> 0:01:30.920 and the foot Sea one hundred is down four tenths 0:01:30.959 --> 0:01:34.160 of a percent. Ten year Treasury up seventeen thirty seconds. 0:01:34.160 --> 0:01:36.960 He had four point one seven percent. They yield on 0:01:37.040 --> 0:01:40.160 the two year four point four seven percent. Nine Max 0:01:40.200 --> 0:01:42.319 Screwed oil is down eight tenths per cent or sixty 0:01:42.360 --> 0:01:44.520 nine cents at eighty three dollars eighty nine cents a 0:01:44.600 --> 0:01:47.200 barrel comes called down four tenths per cent or six 0:01:47.240 --> 0:01:50.280 dollars forty cents at sixteen forty seven sixty an ounce. 0:01:50.680 --> 0:01:53.840 The euro point nine eight five nine against the dollar. 0:01:54.040 --> 0:01:57.320 Nathan Karen. Stocks are coming off two straight days of games. 0:01:57.400 --> 0:01:59.920 Yesterday saw a broad based rally, with more than eighty 0:02:00.040 --> 0:02:03.720 percent of stocks in the SNP five index closing higher earnings. 0:02:03.760 --> 0:02:06.840 Optimism and speculation the Fed will slow its space of 0:02:06.880 --> 0:02:10.160 interest rate hikes helped fuel the one point two percent gain. 0:02:10.280 --> 0:02:13.600 Ben Kirby is co head of investments at Thornburg Investment Management. 0:02:13.960 --> 0:02:16.359 You know, when you look at the surveys of bowls 0:02:16.520 --> 0:02:19.320 versus bears, there's way more bears than there have been 0:02:19.400 --> 0:02:21.480 in a in a long time relative to bowl so 0:02:21.800 --> 0:02:24.560 that at least augers I think for the potential for 0:02:24.560 --> 0:02:27.360 for a snap back. Um, how sustainable that is as 0:02:27.360 --> 0:02:29.640 the economy slows again, That's that's kind of big question. 0:02:29.800 --> 0:02:32.880 Thornburg Investment Management's Ben Kirby thinks we're nearing a peak 0:02:32.960 --> 0:02:35.320 for interest rates. Well. In Asia, Nathan, it was a 0:02:35.400 --> 0:02:39.400 volatile session following yesterday's historic sell off. A benchmark Tank 0:02:39.440 --> 0:02:42.240 index in Hong Kong bounce between gains and losses and 0:02:42.280 --> 0:02:45.840 eventually closed up more than one percent today. That index 0:02:45.880 --> 0:02:49.200 plunge more than seven percent yesterday on the prospects of 0:02:49.280 --> 0:02:52.040 more market and friendly policies during President she j and 0:02:52.120 --> 0:02:55.359 pings their term well, while President she stacks his country's 0:02:55.400 --> 0:02:58.480 top post with allies. Karen White House advisors are working 0:02:58.520 --> 0:03:01.360 on a meeting between the communist leader and President Biden. 0:03:01.560 --> 0:03:05.440 Amy Morris has details from our Bloomberg newsroom in Washington. 0:03:05.760 --> 0:03:09.320 State Department spokesman Ed Price says she's moved effectively. Tearing 0:03:09.320 --> 0:03:12.400 down divisions between party and state won't change the US 0:03:12.440 --> 0:03:15.840 approach to China, a strategy that includes competing on security 0:03:15.880 --> 0:03:18.960 matters while cooperating where they can on global issues like 0:03:19.240 --> 0:03:23.120 climate change, global health, and counter narcotics. National Security Council 0:03:23.200 --> 0:03:25.920 spokesman John Kirby says they're working on a possible meeting 0:03:25.919 --> 0:03:29.040 at the G twenty in Bali next month. Even as 0:03:29.080 --> 0:03:32.120 there are fewer voices at the top two questions, she's 0:03:32.160 --> 0:03:37.120 more restrictive policies in Washington. I'm Amy Morris, Bloomberg Daybreak, right, Amy. Thanks. 0:03:37.120 --> 0:03:39.520 In Europe today, Richie's Sunac is said to become the 0:03:39.640 --> 0:03:42.320 UK's third prime minister in as many months. And let's 0:03:42.320 --> 0:03:44.040 go live to London and get the very latest with 0:03:44.120 --> 0:03:48.000 Bloomberry's un pots. Good morning Ewen, Good morning Karen and Nathan. 0:03:48.040 --> 0:03:51.320 It's just seven weeks since Lisztroust travel to meet Queen 0:03:51.320 --> 0:03:54.960 Elizabeth to become Prime Minister. Later today, the UK will 0:03:55.000 --> 0:03:58.680 have another new leader. Former Chancellor Rishi Sunac will meet 0:03:58.760 --> 0:04:03.080 King Charles this morning after winning the supports of Conservative lawmakers. 0:04:03.120 --> 0:04:05.440 His first task as Britain's new Prime Minister will be 0:04:05.440 --> 0:04:08.440 to appoint his top team as he seeks to reassure 0:04:08.480 --> 0:04:12.119 nervous investors. Jeremy Hunt is likely to remain as Chancellor 0:04:12.360 --> 0:04:15.320 in charge of the nation's finances. In London, Immune posts 0:04:15.520 --> 0:04:17.520 back day break, okay you and thank you. Let's get 0:04:17.520 --> 0:04:19.640 back to markets nowhere. It's a busy day for earnings. 0:04:19.680 --> 0:04:23.200 Shares of HSBC OR down more than six percent this morning. 0:04:23.200 --> 0:04:26.360 The bank reported higher than expected charges for possible loan 0:04:26.440 --> 0:04:29.800 losses in its third quarter. While HSBC joined other banks 0:04:29.800 --> 0:04:32.520 in posting profits the beat estimates, its low lost provision 0:04:32.560 --> 0:04:35.960 was almost a third higher than a Bloomberg compiled consensus. 0:04:35.960 --> 0:04:38.640 Well on the flip side, shares of UBS SIRR up 0:04:38.640 --> 0:04:40.960 one and a half per cent. The Swiss bank reporting 0:04:41.040 --> 0:04:43.919 better than expected profit in the third quarter as higher 0:04:43.960 --> 0:04:47.520 interest rates helped offset lower client activity. We caught up 0:04:47.560 --> 0:04:52.280 with UBS CEO Ralph Hammers, was volatility. Volatility in the 0:04:52.560 --> 0:04:56.320 foreign change markets where we profited a lot actually this quarter, 0:04:56.640 --> 0:04:59.960 which will also see that volatility leading to further sure 0:05:01.480 --> 0:05:04.679 with our emphasis with our clients right on the well side, 0:05:05.320 --> 0:05:09.080 and that in certainly is actually it translated into the 0:05:09.160 --> 0:05:12.240 need for further guidance our clients right, and again we 0:05:12.279 --> 0:05:16.000 need more guidance. EBS CEO Ralph Hammers made the comments 0:05:16.000 --> 0:05:18.919 in an interview with Bloomberg's Menace Cranny Here. More of 0:05:18.960 --> 0:05:22.279 that conversation coming up shortly right here on Bloomberg Daybreak. 0:05:22.400 --> 0:05:24.279 Back here in the US care in a busy week 0:05:24.320 --> 0:05:27.600 for tech earnings kicks off this afternoon, with both Alphabet 0:05:27.680 --> 0:05:30.880 and Microsoft reporting. We get a preview on Microsoft from 0:05:30.920 --> 0:05:35.359 Bloomberg's Jeff Bellinger. Bloomberg Intelligence says the software giant could 0:05:35.360 --> 0:05:40.760 potentially surpass the four consensus for sales growth. Microsoft is 0:05:40.760 --> 0:05:43.320 seen as the company that stands to benefit the most 0:05:43.400 --> 0:05:47.039 from the growing digital shift as clients upgrade their technology, 0:05:47.440 --> 0:05:49.600 But the company's earnings come at a time when there 0:05:49.680 --> 0:05:52.880 is foreign exchange pressure and there are concerns about weakness 0:05:52.920 --> 0:05:56.240 in its PC business. Microsoft is in the process of 0:05:56.320 --> 0:06:01.320 laying off about one thousand workers across multiple division. Jeff Budinger, 0:06:01.480 --> 0:06:05.080 Bloomberg Daybreak All right, Jeff, thanks, While another corporate news 0:06:05.120 --> 0:06:08.520 this morning looks like Adidas is cutting ties of Kanye 0:06:08.600 --> 0:06:12.560 West to get the details from Bloomberg's Lisa Matteo. Bloomberg 0:06:12.600 --> 0:06:14.960 News has learned the German sports company plans to end 0:06:14.960 --> 0:06:17.840 its partnership with the rapper and designer following a rash 0:06:17.839 --> 0:06:21.080 of offensive behavior. West, who now goes by Ya, has 0:06:21.080 --> 0:06:25.280 made controversial statements, including anti Semitic social media posts in 0:06:25.320 --> 0:06:29.560 recent weeks. The Adida's decision follows weeks of deliberations inside 0:06:29.600 --> 0:06:32.279 the company, which, over the past decade has built the 0:06:32.360 --> 0:06:35.560 Easy Line together with Ya, into a brand that's accounted 0:06:35.600 --> 0:06:38.480 for as much as eight percent of Adidas's total sales. 0:06:38.720 --> 0:06:42.200 According to several estimates from Wall Street analysts, Adidas would 0:06:42.240 --> 0:06:46.360 joined Gap and Carrying's Balenciaga fashion label and prematurely cutting 0:06:46.360 --> 0:06:50.440 ties with West. Lisa Matteo Bloomberg Daybreak All Lisa, thank you, 0:06:50.520 --> 0:06:52.840 and shares of Adidas are falling on the news of 0:06:52.920 --> 0:06:56.240 its break up with Kanye West. Shares are down more 0:06:56.279 --> 0:06:59.440 than three percent in Frankfurt, and futures are moving a 0:06:59.480 --> 0:07:02.200 touch low are now caring, with SMP futures down nine 0:07:02.200 --> 0:07:05.640 points now down, futures are down ninety two and NASTACT 0:07:05.720 --> 0:07:09.320 futures are lower by sixteen points. Ten Your Treasury is 0:07:09.440 --> 0:07:12.640 up sixteen thirty seconds the old four point one seven 0:07:12.640 --> 0:07:15.560 percent yield on the two year, four four seven. Straight ahead, 0:07:15.600 --> 0:07:18.280 your latest local headlines and to check of sports. This 0:07:18.520 --> 0:07:24.720 is Bloomberg South five oh seven on Wall Street. You've 0:07:24.720 --> 0:07:27.440 got some fog sixty three degrees in Central Park. It's 0:07:27.440 --> 0:07:29.920 slow on the cross Bronx between Third and Webster because 0:07:29.920 --> 0:07:32.960 of construction. Details coming up in traffic. First Michael Barr 0:07:33.040 --> 0:07:34.560 with more on what's going on in New York and 0:07:34.640 --> 0:07:37.800 around the world. Good morning, Michael, Good morning. Nathan Man 0:07:37.960 --> 0:07:40.400 is in custody in New York City for last week's 0:07:40.480 --> 0:07:43.840 violent and unprovoked attack on the subway. Writer forty one 0:07:43.920 --> 0:07:47.360 year old Lamal McCrae, who police say has an extensive 0:07:47.360 --> 0:07:51.000 criminal history. It's now accused of shoving thirty two year 0:07:51.000 --> 0:07:53.679 old David Martin onto the train tracks at the Brooklyn 0:07:53.680 --> 0:07:57.280 Subway stop last Friday. Martin survived, but his family says 0:07:57.320 --> 0:08:01.160 he's traumatized and suffered a broken collar boom. The attack 0:08:01.240 --> 0:08:05.640 prompting the NYPD to step up its presence at subway stations. Meanwhile, 0:08:05.720 --> 0:08:09.840 commuters are now searching out places along railings on the 0:08:09.920 --> 0:08:20.600 platform where they feel they can't be assaulted. The m 0:08:20.600 --> 0:08:23.440 t A is now also trying to gain the authority 0:08:23.440 --> 0:08:26.640 to ban people with convictions that include violent crime on 0:08:26.720 --> 0:08:29.920 the ground from using the subway system. There was a 0:08:29.960 --> 0:08:32.920 tragic accident and the subway in Manhattan. Authorities say a 0:08:32.960 --> 0:08:36.480 commuter was struck and killed by a one train at 0:08:36.520 --> 0:08:40.720 fifty ninth Street Columbus Circle yesterday afternoon after getting caught 0:08:40.760 --> 0:08:43.319 in the doors. Officials say the twenty year old man 0:08:43.480 --> 0:08:45.960 was dragged by the train after a piece of clothing 0:08:46.280 --> 0:08:49.800 got caught him the subways doors and then was fatally struck. 0:08:50.320 --> 0:08:53.600 Its debate night between New York Democratic Governor Kathy Hokel 0:08:53.640 --> 0:08:57.080 and a Republican challenger, Lees Eldon. The two are expected 0:08:57.120 --> 0:09:00.760 to debate such topics as crime and the state's bail 0:09:00.840 --> 0:09:04.000 reform laws. Hocal and Selden will hit the podiums at 0:09:04.240 --> 0:09:08.800 seven pm. Florida's Governor Rhonda Santists declined to say whether 0:09:08.880 --> 0:09:14.000 he'll run for president as Democrat Florida Governor h Charlie 0:09:14.080 --> 0:09:18.120 christ Rother debated ahead of next month's elections. Governor to Santists, 0:09:18.160 --> 0:09:21.760 defendant laws passed during his term that restricted the teaching 0:09:22.080 --> 0:09:26.320 of racial and gender issues in Florida schools. I'm proud 0:09:26.360 --> 0:09:28.480 of our history. I don't want to teach kids to 0:09:28.559 --> 0:09:30.800 hate our country. I don't want to teach kids to 0:09:30.840 --> 0:09:33.840 hate each other. And the way to stop discrimination on 0:09:33.880 --> 0:09:37.160 the basis of race is to stop discriminating on the 0:09:37.200 --> 0:09:40.920 basis of race. The debates airing on wp e C 0:09:41.559 --> 0:09:44.040 Global News twenty four hours a day on air and 0:09:44.160 --> 0:09:46.880 on Bloomberg Quittake, powered by more than twenty seven hundred 0:09:46.920 --> 0:09:49.880 journalists analysts more than a hundred twenty countries. Michael Barr 0:09:49.880 --> 0:09:57.520 and this is Bloomberg, Nathan. Thanks Michael. It's five oh 0:09:57.600 --> 0:09:59.760 nine on Lall Street. Time for the Bloomberg Sports Upday 0:09:59.760 --> 0:10:02.520 for you buy tri State Abbey. Good morning, John Stanshow, 0:10:02.600 --> 0:10:04.760 Good morning, Nathan. The Jets, having won four in or All, 0:10:04.760 --> 0:10:06.800 perhaps tuned into the Monday night, came to watch the 0:10:06.920 --> 0:10:09.920 Patriots two of the jets next three games versus New England, 0:10:09.920 --> 0:10:12.640 who got surprisingly blown out at home by Chicago thirty 0:10:12.679 --> 0:10:15.480 three to fourteen. The Bears scored the last twenty three 0:10:15.480 --> 0:10:17.960 points they had rush the Pats two hundred forty three 0:10:18.000 --> 0:10:21.439 to seventy a fourth four turnovers. Mac Jones returned to 0:10:21.520 --> 0:10:24.120 his ankle and dream I got bench for rookie Bailey Zappy. 0:10:24.480 --> 0:10:26.680 Bill Belichick said he's not sure who his quarterback would 0:10:26.679 --> 0:10:29.720 be Sunday at MetLife. That Jet win in Denver was costly. 0:10:29.840 --> 0:10:32.120 Rookie running back Breze Hall towards a c l guard 0:10:32.120 --> 0:10:35.640 Elija Vera Tucker towards triceps both done for the year. 0:10:35.679 --> 0:10:38.600 The Jets coach dropt salis the NFL, uh you know, 0:10:38.679 --> 0:10:41.040 the sex amount of Michael Carter has proven that he 0:10:41.040 --> 0:10:43.760 can carry the load, and uh Ti Johnson has done 0:10:43.760 --> 0:10:46.560 a really nice job and with our offensive line, because 0:10:46.840 --> 0:10:49.560 offensive line we've been you know, it's been all year 0:10:49.640 --> 0:10:51.720 with guys shuffling, and just got a lot of faith 0:10:51.760 --> 0:10:53.040 in the guys that are here to be able to 0:10:53.080 --> 0:10:54.920 step in and continue to do the job that was 0:10:54.960 --> 0:10:57.320 done before before them. And the Jets last night made 0:10:57.360 --> 0:10:59.160 a train to get a running back. They sent a 0:10:59.240 --> 0:11:02.920 late round draft pick acquire James Robinson from Jacksonville. That's 0:11:02.920 --> 0:11:04.920 where the Giants just won their fourth in ROBA. They 0:11:04.960 --> 0:11:08.040 saw three offensive starters go down knee injuries to guard 0:11:08.080 --> 0:11:11.040 Ben Bretticent and tackle Evan Neil and I injury. The 0:11:11.080 --> 0:11:14.400 rookie Titan Daniel Bellinger. None will play this week in Seattle, 0:11:14.760 --> 0:11:16.880 but all could be back later in the season. At 0:11:16.880 --> 0:11:19.400 the Garden nixt pet Orlando won fifteen one oh two. 0:11:19.480 --> 0:11:22.600 Julius Randall twenty five points. Jalen Brunston had twenty one 0:11:22.640 --> 0:11:25.800 in r J. Barrett twenty in Memphis thirty seven points 0:11:25.800 --> 0:11:28.760 for both Kevendurant and Kybrie Irving, but thirty eight for 0:11:28.880 --> 0:11:32.439 both John Morant and Desmond Baine. And the Grizzlies Methan 0:11:32.480 --> 0:11:35.040 nets one thirty four one two. The Devil's lost to 0:11:35.120 --> 0:11:39.000 Washington six to three. Johns Dashwarck Bloomberg Sports, Nathan, thanks 0:11:39.040 --> 0:11:41.800 john S and p. Futures down nine points down, Futures down, 0:11:42.720 --> 0:11:45.960 futures down thirteen points ten. Your treasury is up fifteen 0:11:46.000 --> 0:11:49.240 thirty seconds yield four point one seven percent Feld on 0:11:49.280 --> 0:11:53.240 the two year four point four seven percent. UBS shares 0:11:53.400 --> 0:11:56.920 up nearly five percent in Zurich on the back of 0:11:57.240 --> 0:12:00.080 strong earnings for the Swiss Bank. Will speak with the 0:12:00.080 --> 0:12:07.839 CEO Ralph Lalmer's next. This is Bloomberg. Bloomberg Sports is 0:12:07.880 --> 0:12:09.920 brought to you by Audie. Don't let someone else drive 0:12:09.960 --> 0:12:12.120 off in the Audi model. You've always wanted to visit 0:12:12.160 --> 0:12:14.760 your local price state Audie dealer to get behind the 0:12:14.760 --> 0:12:17.840 wheel of yours today, or visit Autie Offers dot com 0:12:17.920 --> 0:12:24.839 for more information, markets, headlines and breaking news twenty four 0:12:24.840 --> 0:12:27.920 hours a day at Bloomberg dot com, the Bloomberg Business 0:12:27.920 --> 0:12:31.600 Outland at Bloomberg Quick Tape. This is a Bloomberg Business 0:12:31.600 --> 0:12:40.319 flash and I'm Karen Moscow futures are lower this morning, 0:12:40.320 --> 0:12:43.360 with SNP futures down ten points down, futures down ninety 0:12:43.360 --> 0:12:46.520 eight and nasdack futures down fourteen ten year treasury of 0:12:46.640 --> 0:12:49.080 fourteen thirty seconds, he had four point one eight percent 0:12:49.120 --> 0:12:51.000 and they yield him a two year four point four 0:12:51.120 --> 0:12:53.800 seven per cent. Nim X screwed oil down one point 0:12:53.840 --> 0:12:56.320 four on a dollar sixteen at eighty three dollars forty 0:12:56.360 --> 0:12:59.040 two cents a barrel, comic school down four ten percent 0:12:59.120 --> 0:13:01.600 or seven dollars twenty since at sixteen forty six nine. 0:13:01.720 --> 0:13:05.120 Announce the euro point in nine eight six four against 0:13:05.120 --> 0:13:08.160 the dollar, the yen one point eight nine. That's a 0:13:08.200 --> 0:13:10.760 Bloomberg business flash. Now here's Michael Barr with more on 0:13:10.880 --> 0:13:13.240 what's going on around the world. Michael, Karen, thank you 0:13:13.320 --> 0:13:15.839 very much. Rashi Sunac is due to be installed as 0:13:15.880 --> 0:13:18.720 Britain's third Prime Minister of the year by King Charles 0:13:18.720 --> 0:13:21.720 the Third. Then his first task is appointing a cabinet 0:13:21.800 --> 0:13:26.000 that can wrestle with the UK's economic and political crisis. 0:13:26.040 --> 0:13:29.280 Sunac was selected as leader of the governing Conservative Party 0:13:29.320 --> 0:13:32.520 after the brief term of Liz trust In St. Louis, 0:13:32.559 --> 0:13:35.480 a former student broken to Central Visual and Performing Arts 0:13:35.559 --> 0:13:38.319 High School, fatally shooting two and wounding six others. The 0:13:38.400 --> 0:13:41.400 nineteen year old gunman was reportedly killed by police in 0:13:41.400 --> 0:13:44.280 the NBA the next one and the Nets and Celtics 0:13:44.320 --> 0:13:47.520 lost in hockey The Capital's Beat the Devil. Six three 0:13:47.880 --> 0:13:50.719 Global News twenty four hours a day on air and 0:13:50.880 --> 0:13:54.360 on Bloomberg Quicktake, powered by more than twenty seven hundred 0:13:54.440 --> 0:13:58.160 journalists analysts more than one hundred twenty countries. Michael Barren, 0:13:58.240 --> 0:14:01.360 this is Bloomberg Anthem. Thanks, It's five nineteen on Wall 0:14:01.400 --> 0:14:04.440 Street Live from the Bloomberg Interactive Broker Studios. This is 0:14:04.480 --> 0:14:06.560 Bloomberg Daybreak and we now like to bring you an 0:14:06.559 --> 0:14:09.959 interview with the CEO of UBS, Ralph Hammers. He spoke 0:14:10.000 --> 0:14:13.600 with Bloomberg's Manus Cranny after the Swiss Bank beat third 0:14:13.640 --> 0:14:17.080 quarter estimates thanks to higher interest rates. They talked about 0:14:17.120 --> 0:14:20.360 the results, the outlook for the bank and for the economy. 0:14:20.960 --> 0:14:23.240 Every time you sit down, it talks like huge volatility, 0:14:23.320 --> 0:14:27.160 de leveraging and client sentiment. But let's let's trim it 0:14:27.160 --> 0:14:31.200 down a bit. Huge volatility, and yet you see pretty 0:14:31.200 --> 0:14:36.720 substantial inflows on the generating in I'm three generating assets. 0:14:37.000 --> 0:14:41.080 Where did it come from? And are you surprised? Good morning, 0:14:41.120 --> 0:14:43.480 menus and and indeed, I think you're heading at the 0:14:44.240 --> 0:14:47.960 right point here. So was he volatility? Volatility in the 0:14:48.000 --> 0:14:51.680 foreign change markets where we profited a lot actually this quarter, 0:14:52.040 --> 0:14:56.960 which also see that volatility leading to further certainty with 0:14:57.080 --> 0:15:00.120 our investors, with our clients right on the well side it, 0:15:00.720 --> 0:15:04.480 and that in certainly is actually it translated into the 0:15:04.560 --> 0:15:07.040 needs for further guidance, and ninety percent of our clients 0:15:07.040 --> 0:15:09.680 are in again we need more guidance. And if they 0:15:09.720 --> 0:15:12.080 want more guidance, that's why they bring their money to us, 0:15:12.080 --> 0:15:13.800 and that's why we sort of post to flow so 0:15:13.840 --> 0:15:17.440 strongly coming into our franchise this quarter, seventeen billions of 0:15:17.720 --> 0:15:21.120 you fee generating assets globally, seven billion in Asia and 0:15:21.200 --> 0:15:24.680 six billion in the media and four billion in the US. 0:15:25.680 --> 0:15:29.600 Clients are in full fear tin hat moded moment. I 0:15:29.640 --> 0:15:32.080 don't think they're in full fear. These clients there are 0:15:32.120 --> 0:15:36.040 also rational. Clearly they're looking at things and they want guidance, 0:15:36.040 --> 0:15:39.000 but in the end they do stay invested. They're looking 0:15:39.000 --> 0:15:42.720 for further cash opportunities and further alternative opportunities to invest 0:15:42.760 --> 0:15:45.040 in as well. So it's all about, you know, how 0:15:45.080 --> 0:15:48.000 to diversify the portfolio and how to get more exposure 0:15:48.040 --> 0:15:50.920 to to cash and near cash and increase the yield there. 0:15:51.240 --> 0:15:54.000 And that's what we've seen. But there are more on 0:15:54.080 --> 0:15:57.000 the sidelines and not so much completely withdrawing from the 0:15:57.040 --> 0:15:59.760 market and the other outlets you do three this number, 0:16:00.160 --> 0:16:04.000 the seven numbers, and the guidance. Isn't that interest income? 0:16:04.280 --> 0:16:07.720 It's the banking story of this year and next talk 0:16:07.760 --> 0:16:10.040 me through the guidance. What will you do in names 0:16:10.120 --> 0:16:14.040 this year and what's going to drive it into So 0:16:14.120 --> 0:16:16.960 you actually see quite some pick up on that interest 0:16:17.000 --> 0:16:20.160 income dis quarter already. That is on the back of 0:16:20.520 --> 0:16:24.720 further improvements in the way we manage our clients money 0:16:25.920 --> 0:16:29.960 from from sweeps to deposits and other alternatives. We saw 0:16:30.040 --> 0:16:32.840 and I going up fourteen per cent between P and 0:16:32.880 --> 0:16:36.120 C and g w M and the fourth quarter regarding 0:16:36.120 --> 0:16:40.040 a continuation of an increase of of n II up 0:16:40.080 --> 0:16:43.000 to the two d million. But even beyond that, given 0:16:43.040 --> 0:16:45.320 the fact that we don't only have expostures to U 0:16:45.400 --> 0:16:48.320 S dollars with our clients, but we also have large 0:16:48.320 --> 0:16:53.119 amounts of deposits from clients in Euros and Swiss Franks, 0:16:53.160 --> 0:16:57.680 we actually expect more website on those currencies next year 0:16:58.680 --> 0:17:00.760 and on that rate. The debate is this is whether 0:17:00.760 --> 0:17:03.480 it's peak inflation, peak rates. Where do you sound on 0:17:03.520 --> 0:17:06.560 the US rates, which has been the alpha of this year, 0:17:06.600 --> 0:17:09.320 Where can we get to in dollar rates? Well, we 0:17:09.400 --> 0:17:12.359 expect that the fat will fertile hike maybe to five 0:17:12.720 --> 0:17:16.040 five and a quarter and to really fight that inflation 0:17:16.560 --> 0:17:19.640 um maybe at the cost of a slight recession, if 0:17:19.680 --> 0:17:22.680 at all, but that you know that danger is there. 0:17:23.560 --> 0:17:26.800 We think it's okay. On the US side, we do 0:17:26.920 --> 0:17:29.840 expect for the high ext two too in a quarter, 0:17:30.240 --> 0:17:32.800 and on the Swiss Frank side we expect photos to 0:17:32.960 --> 0:17:34.720 one in a quarter. Can I charge you a little 0:17:35.359 --> 0:17:40.720 represented in the US it delivers a mild session. Well, 0:17:40.760 --> 0:17:43.760 I mean, there's always this terminology is it a deep 0:17:43.760 --> 0:17:46.719 percession model recession? Is it two quarters the three quarters? 0:17:46.720 --> 0:17:49.240 It doesn't really matter. I think for the U S market, 0:17:49.320 --> 0:17:52.320 we've always seen that market to dynamics, so the rebound 0:17:52.359 --> 0:17:55.840 will also be good. The jobs, the job numbers are 0:17:55.840 --> 0:18:00.040 still good, the household numbers are still good. So know, 0:18:00.240 --> 0:18:04.480 I do think that further further increases in yields will 0:18:04.560 --> 0:18:10.119 not be so detrimental to the economy. Ask you you 0:18:10.240 --> 0:18:13.040 fee generating assets of a seventeen billion dollars, did you 0:18:13.040 --> 0:18:14.920 have a credit swite moment? Was there a month to 0:18:15.000 --> 0:18:18.800 move from credit suite into uvs? Tell the world well, 0:18:18.840 --> 0:18:21.760 and we were not going into how our competitors developed. 0:18:21.760 --> 0:18:25.840 And I don't think we need competitors to help us there. 0:18:26.520 --> 0:18:30.200 From that perspective, we have a global wealth business. Wealth 0:18:30.280 --> 0:18:34.600 is what we do. We we have very strong client 0:18:34.680 --> 0:18:37.239 relationships and clients are just bringing more money to us 0:18:37.280 --> 0:18:39.480 for the guidance that we can give and also the 0:18:40.040 --> 0:18:43.640 spread and the certification we can advise on. No signifigance 0:18:43.760 --> 0:18:46.720 credit suites in flow moment. As I said, you know, 0:18:46.760 --> 0:18:49.119 this is not for us to go into that. But 0:18:49.880 --> 0:18:52.960 I think the unaligning trend is really more driven by 0:18:53.400 --> 0:18:57.080 clients looking for guidance than anything else. Good Bye back. Sarah, 0:18:57.200 --> 0:19:00.240 you CFO guided us that a conference recently has lies 0:19:00.280 --> 0:19:02.320 in need that the botback will be more than five billion. 0:19:02.359 --> 0:19:05.600 What would it be, Well, it really depends on how 0:19:05.600 --> 0:19:08.439 to market development and also the liquidity in the market, 0:19:08.520 --> 0:19:10.120 because there was a limit to what we can do 0:19:11.400 --> 0:19:14.040 year today. Last Friday we were at four point six. 0:19:14.080 --> 0:19:16.960 We will continue at the same level of speed, so 0:19:17.800 --> 0:19:20.520 we should be getting certainly over to five million towards 0:19:20.520 --> 0:19:23.960 the five and a half. And that was UBS CEO 0:19:24.080 --> 0:19:27.320 Ralph Hammers speaking with Bloomberg's Manus Cranny. Stick with us. 0:19:27.320 --> 0:19:29.320 We'll bring you more of that interview later in the show. 0:19:29.680 --> 0:19:32.560 You can also watch the full conversation on Bloomberg dot 0:19:32.600 --> 0:19:36.720 com and on the Bloomberg terminal. And following the earnings 0:19:36.720 --> 0:19:40.560 from Ubs, the shares are up more than four percent 0:19:40.720 --> 0:19:44.800 right now in Zurich, SMP futures are moving lower now 0:19:44.880 --> 0:19:49.080 down ten points, STOUT futures down, NASTACK futures are down 0:19:49.119 --> 0:19:52.960 by twelve points ten Your treasury is up fifteen thirty seconds. 0:19:53.040 --> 0:19:55.840 Yield four point one seven percent. Yield on the two 0:19:55.920 --> 0:19:59.600 year four point four seven percent. Nim X crew down 0:19:59.640 --> 0:20:02.359 one PO two right now at eighty three dollars fifty 0:20:02.440 --> 0:20:08.040 nine cents of barrel. This is Bloomberg. Bloomberg day Break, 0:20:08.040 --> 0:20:09.840 brought to you by the New York Community Trust. Your 0:20:09.880 --> 0:20:11.760 name will live on as a champion of the causes 0:20:11.840 --> 0:20:14.200 you care about for years to come through a charitable 0:20:14.200 --> 0:20:16.679 bequest to the New York Community Trust. Learn more at 0:20:16.680 --> 0:20:25.399 Philanthropists dot NYC. Broadcasting live from the Bloomberg Interactive Broker 0:20:25.520 --> 0:20:29.200 Studio in New York, Bloomberg Living Freedom to Washington, d C, 0:20:29.400 --> 0:20:34.080 Bloomberg to Boston, Bloomberg one O six one to San Francisco, 0:20:34.160 --> 0:20:37.399 Bloomberg Own sixteen to the Country Sirius XM chent A 0:20:37.480 --> 0:20:40.359 one nine Tea, and around the globe the Bloomberg Business 0:20:40.400 --> 0:20:44.480 app and Bloomberg Radio dot Com. This is Bloomberg Daybreak 0:20:50.240 --> 0:20:52.439 and it's five thirty on Wall Street. Good morning. I'm 0:20:52.520 --> 0:20:55.680 Karen Moscow, I'm Nathan Hager. Bloomberg Daybreak is brought to 0:20:55.720 --> 0:20:59.159 you by se I. Imagine your asset management firms operational 0:20:59.200 --> 0:21:02.439 infrastructure at a competitive advantage. Let se I show you 0:21:02.520 --> 0:21:05.840 how at se i c dot com slash I m s. Well, 0:21:05.840 --> 0:21:08.159 we're just about four hours away from the open of 0:21:08.240 --> 0:21:09.840 US trading, Let's get you up to date on the 0:21:09.880 --> 0:21:11.880 news you need to know. At this hour, stocks are 0:21:11.880 --> 0:21:14.959 coming off two straight days of gains. Steady earnings and 0:21:15.000 --> 0:21:18.680 hope for slowing rate hikes help fuel the rally. Robert Stimpson, 0:21:18.800 --> 0:21:22.879 chief investment officer with Oak Associate Funds, says, recession or not, 0:21:23.080 --> 0:21:26.960 traders should expect shoppiness ahead. Our recession doesn't matter for 0:21:27.040 --> 0:21:30.080 stock They simply do not like a slowing economy and 0:21:30.119 --> 0:21:32.000 that is what we have. So whether it's a mid 0:21:32.040 --> 0:21:35.960 cycle slowdown or a soft landing or a recession, stocks 0:21:35.960 --> 0:21:38.920 tend to struggle when the economy is slowing, and that's 0:21:38.920 --> 0:21:41.240 the environment we're in. So the last week may have 0:21:41.280 --> 0:21:43.320 been better, but we do think it's going to be 0:21:43.480 --> 0:21:46.960 well into next year before stocks get further signals that 0:21:47.040 --> 0:21:50.800 have sustained advance is really possible. Robert Stimpson with Oak 0:21:50.880 --> 0:21:54.120 Associate Funds believe stocks have not bought them just yet 0:21:54.320 --> 0:21:57.680 any time. In Asia, Karen Hong Kong's benchmark Tech index 0:21:57.720 --> 0:22:00.560 bounced between gains and losses but close up more than 0:22:00.600 --> 0:22:03.479 one percent today. It follows a more than seven percent 0:22:03.560 --> 0:22:07.360 drop yesterday over concerns Chinese President Shijn Ping's third term 0:22:07.400 --> 0:22:11.360 will bring unfriendly market policies well. She is stacking China's 0:22:11.400 --> 0:22:14.439 top posts with allies who are less likely to counter 0:22:14.600 --> 0:22:18.480 restrictive policies Nathan, but White House advisers say they're still 0:22:18.520 --> 0:22:21.639 working on a meeting between the communist leader and President Biden, 0:22:21.920 --> 0:22:25.320 possibly at the G twenty in Bali next month. Over Europe, 0:22:25.359 --> 0:22:28.280