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Speaker 1: This is Bloomberg Daybreak here for this Thursday, the twenty

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Speaker 1: sixth of January in London. Coming up this hour. Back

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Speaker 1: in the driving seat, Musk says Tessler could deliver one

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Speaker 1: point eight million cars this year. A crisis of confidence.

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Speaker 1: UK business sentiment drops to its lowest level in more

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Speaker 1: than a decade. When the chips are down, Bloomberg learns

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Speaker 1: Britain semi conductor industry will get a cash boost from taxpayers.

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Speaker 1: Morgan Stanley's unwelcome notification UK Texas Abroad and Elon Musk

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Speaker 1: wants an equity raise. Those are the stories we're looking

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Speaker 1: at in today's papers. I'm James Walcock. Plus try turning

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Speaker 1: it off and on again, Mayhem at the n y

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Speaker 1: s C open trace to leaving a backup system running.

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Speaker 1: That's all straight ahead on Bloomberg Daybreak Europe on DAB

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Speaker 1: Digital Radio, London, Bloomberg eleven three oh New York, Bloomberg

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Speaker 1: Washington d C, Bloomberg one oh six one, Boston, Bloomberg

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Speaker 1: nine six, Francisco cyrus XM Channel one nineteen and around

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Speaker 1: the world on Bloomberg Radio dot com and via the

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Speaker 1: Bloomberg Business Set. Good morning, I'm Stephen Carroll and I'm

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Speaker 1: Caroline Hedger. Here are the stories that we're following today

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Speaker 1: to bring us some breaking corporate news. In the German

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Speaker 1: software giant s a P, it's announcing that it's to

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Speaker 1: explore a sale of its stake in qual Tricks and

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Speaker 1: to conduct restructuring this year, affecting two point five percent

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Speaker 1: of its staff. This as the company is seeing it's

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Speaker 1: twenty three none i FRS operating profit coming in above

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Speaker 1: the previous estimates eight point eight to nine point one

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Speaker 1: billion euros. That's above the estimate which was eight point

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Speaker 1: six five billion for twenty three Okay, another breaking a

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Speaker 1: news line this morning from SEB. The bank fourth quarter

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Speaker 1: net interest income at nine point seven to billion Swedish

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Speaker 1: Krona is beat on the estimated nine point five three billion.

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Speaker 1: We're getting quite a number of earnings this morning, including

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Speaker 1: from others, so will have Volvo, LVMH and more out

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Speaker 1: of Europe today. Let's get to our top stories this morning.

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Speaker 1: Shares in Tesla have risen and after hours trading as

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Speaker 1: the electric car giant beat expectations on profit and sales.

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Speaker 1: Tesla now says it's on track to deliver one point

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Speaker 1: eight million vehicles this year. CEO Elon Musk says the

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Speaker 1: thirty seven percent rise is a conservative projection. It was

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Speaker 1: a smoothier actually. You know, without big supply chain interruption

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Speaker 1: or massive problem, you have the potential to do two

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Speaker 1: million cars this year. We're not committing to that. I'm

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Speaker 1: just saying that's the potential. Speaking to investors, Musk added

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Speaker 1: that twenty two was a difficult year due to shutdowns

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Speaker 1: at Tesla's China factory, higher borrowing costs and logistical issues. Now,

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Speaker 1: business confidence in Britain has sunk to its lowest level

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Speaker 1: since the global financial crisis, according to a survey of

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Speaker 1: accountants with more his Bloomberg's You and Parts. It's the

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Speaker 1: lowest reading since two thousand and nine. The survey by

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Speaker 1: the Institute of Chartered account in England and Wales says

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Speaker 1: the business sentiment fell to a reading of minus twenty

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Speaker 1: three last month, a big drop from minus seventeen in November.

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Speaker 1: The group found that the construction firms are the most

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Speaker 1: downbeat when it came to their economic prospects, and companies

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Speaker 1: in the retail, property and manufacturing sectors all reported problems

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Speaker 1: accessing capital. These findings are echoed by a separate survey

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Speaker 1: from the Federation of Small Businesses, which found that morale

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Speaker 1: was plummeting amongst smaller firms in London immune parts of

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Speaker 1: Booby Daybreak Europe. Bloomberg understands the UK government will provide

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Speaker 1: direct taxpayer funding to support British semiconductor companies, and overall

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Speaker 1: figure for the investment hasn't been agreed with the Treasury,

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Speaker 1: but is expected to be at least a billion pounds.

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Speaker 1: Speaking to us here on Bloomberg Radio, David Lammy, the

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Speaker 1: Shadow Foreign Secretary, says the UK must partner with the

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Speaker 1: European Union to secure its supply of semiconductors. It's not

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Speaker 1: the case that the UK can do this on its own.

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Speaker 1: It can't do this on its own. But if we

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Speaker 1: are seeing major allies in a protection of posture, if

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Speaker 1: we are seeing a world that's more multipolar and potentially

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Speaker 1: more dangerous, that it is important for all companies to diversify.

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Speaker 1: David Lammy's comments come as continued global chip shortages contributed

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Speaker 1: to one to the worst year since nineteen fifty six

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Speaker 1: for car production in the UK. Now, let's turn our

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Speaker 1: attention to the United States, because it's joining Germany in

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Speaker 1: sending main battle tanks to help Ukraine repel Russian forces.

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Speaker 1: America is sending thirty one of its M one Abraham's tanks,

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Speaker 1: while Germany will supply fourteen Leopard two tanks. Announcing the move,

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Speaker 1: President Joe Biden said that Putin has made a major

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Speaker 1: miscalculation about the West. I've been saying this for a

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Speaker 1: long time. The expectation of the part of Russia is

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Speaker 1: we're going to break up. We're not going to stay united.

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Speaker 1: But we are fully, thoroughly, totally united. President Biden added

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Speaker 1: that the delivery of the vehicles will take I'm it's

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Speaker 1: understood that the first batch of Leopard tanks from Germany

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Speaker 1: could arrive within three months. Massa says it will rein

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Speaker 1: stays former President Donald Trump's Facebook and Instagram accounts with

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Speaker 1: the details his Bloomberg's ad Baxter. This ends two years

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Speaker 1: of being banned. Meta says from the beginning it was

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Speaker 1: for an undetermined amount of time, and that the public

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Speaker 1: should be able to hear what their politicians are saying,

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Speaker 1: the good, the bad, and the ugly, so they can

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Speaker 1: make informed choices at the ballot box. At the same time. Now,

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Speaker 1: Meta says it has changed oversight rules that can cause

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Speaker 1: another suspension of violated with more severe penalties. Meta says

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Speaker 1: it will restore the accounts in the coming weeks. In

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Speaker 1: San Francisco, I'm at Baxter Bloomberg Daybreak Europe. Now. The

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Speaker 1: New York Stock Exchange has blamed manual error for the

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Speaker 1: world price wings and trading halts on Tuesday's market open.

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Speaker 1: Bloomberg understands that an employee failed to properly shut down

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Speaker 1: the company's disaster recovery system before the open, causing the problems.

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Speaker 1: More than one thousand three D trades and some eighty

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Speaker 1: four stocks were affected. Those are our top stories this morning.

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Speaker 1: I mean, it's obviously had a huge consequence. Is one

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Speaker 1: of those things that you just kind of think, like

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Speaker 1: it's so easy not to, you know, not to power

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Speaker 1: down and power back up again at the right point.

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Speaker 1: I think I professionals like to call it a para

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Speaker 1: cycle on again. Okay, you've got the lingo. Yes, Look

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Speaker 1: it took them hours though to find it, and it

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Speaker 1: was this one protocol in this data center quite a

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Speaker 1: long way from the n Y S. So this is, yeah,

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Speaker 1: a glitch in the system. Pretty seriously with the best technology,

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Speaker 1: human error is still an issue you have to watch

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Speaker 1: out for. Let's just bring you up today with a

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Speaker 1: couple of other corporate headlines we've gotten this morning. Plenty

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Speaker 1: of companies reporting st Microelectronics seeing their first quarter net revenue.

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Speaker 1: Big beat for them, four point two billion dollars. The

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Speaker 1: estimate have been for three point eight one billion. That's

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Speaker 1: the forecast for the first quarter in net revenue from

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Speaker 1: st Micro. They're also expecting their net revenues for the

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Speaker 1: follier of twenty three to be between sixteen point eight

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Speaker 1: billion dollars and seventeen point eight billion. Yeah. There's also

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Speaker 1: on a slightly lighter note, perhaps this will help me

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Speaker 1: a few weeks ago. Do you remember when I told

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Speaker 1: you that I had to do a driver a driver

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Speaker 1: test again. Well, there's now an app for car admin.

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Speaker 1: Lloyd's Banking Group has put four million pounds into Cora,

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Speaker 1: which apparently is an app focused on inner cities. So

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Speaker 1: it's an all in one place where drivers can kind

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Speaker 1: of manage their insurance that mot all of the charges

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Speaker 1: that you get in London. Yeah, fascinating, I mean it

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Speaker 1: seems like the sort of thing that could actually relieve

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Speaker 1: quite a lot of the admin around owning a car.

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Speaker 1: Interesting seats already back by Jagger Lando over his venture

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Speaker 1: arm as well. So that's you see Lloyd's joining in

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Speaker 1: on that one. Yeah, absolutely coming up next though more

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Speaker 1: banker WhatsApp fines UK tech moves to America and he'll

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Speaker 1: swap you one hundred and forty characters for three billion dollars.

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Speaker 1: Now off the paper review on bluebirdday Break Europe. The

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Speaker 1: news you need to know from today's papers them Exchange

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Speaker 1: World CUX joins us now with a look at today's papers.

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Speaker 1: Lots of front pages focusing on the decision to send

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Speaker 1: thanks to Ukraine The Eye for example, the headline their

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Speaker 1: allies send tanks to hold back Putin as Ukraine war escalates.

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Speaker 1: But James, you've been looking at some of the other

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Speaker 1: stories in the papers today, the Times talking about a

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Speaker 1: fresh blow to the UK's tech ambitions. Yes, Steven, So

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Speaker 1: it's all about how a sense you're the foot see

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Speaker 1: two Information Events Group they are looking at listing in

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Speaker 1: the US. This is a big problem for the UK government.

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Speaker 1: In last year's Awtin statement, Jeremy Hunt outlined ambitions to

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Speaker 1: transform the UK into the next silicon Valley, and it's

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Speaker 1: been a wider problem for keeping tech in the UK broadly.

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Speaker 1: I mean, there's the big discussions around ARM right now,

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Speaker 1: the ship company we've just been talking about sort of

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Speaker 1: the Chip story this morning, how the UK wants to

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Speaker 1: subsidize it. Investors, governments, regulators and the public all expect

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Speaker 1: the domestic company to normally list in its sort of

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Speaker 1: like home country. But tech is that exception where it

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Speaker 1: moves to the U S where it has a big capital.

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Speaker 1: It's often seeks to kind of go to that sort

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Speaker 1: of pool because it doesn't have to be as localized.

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Speaker 1: But for the UK's ambitions to make itself a global

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Speaker 1: tech superpower, it really wants to keep these kind of

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Speaker 1: emerging giants that it's trying to home grow staying in

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Speaker 1: the UK. And so although there are big discussions, are

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Speaker 1: and that would be one to watch in the future,

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Speaker 1: essentially is already paving the way by moving the way

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Speaker 1: to the U S. I'll pick you up on that though,

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Speaker 1: because big discussions, I mean, that's the question, are they're

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Speaker 1: really big discussions. The government has said that they really

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Speaker 1: want the soft Bank owned ARM, which is based in Cambridge,

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Speaker 1: to list in the UK. But the problem is we

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Speaker 1: haven't heard from the other side. We don't know whether

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Speaker 1: that's really a possibility for you know, from SoftBank's perspective.

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Speaker 1: So yes, that's I think that's the issue the government

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Speaker 1: would like big conversations. Look. Moving on from that though,

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Speaker 1: Um this issue that the Lawsuit Journal picks up on,

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Speaker 1: Elon Musk is exploring raising up to three billion dollars

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Speaker 1: to pay off Twitter debts. Yes, as if there wasn't

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Speaker 1: enough sort of complexity around this kind of Twitter story

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Speaker 1: already they are reporting, and it's worth saying that Haw

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Speaker 1: has been confirmed. This is a kind of people familiar

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Speaker 1: that Ellen is discussing selling up to three billion dollars

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Speaker 1: in new Twitter shares, and that would be kind of

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Speaker 1: as away of refinancing some of the debt that Twitter

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Speaker 1: and back sensioned him have taken on. Now, the original

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Speaker 1: price these shares were taken private act was fifty four

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Speaker 1: point twenty dollars per share. Apparently he wanted that original valuation,

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Speaker 1: but he's facing quite an uphill valuation from sort of

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Speaker 1: upper battles are trying to keep it there from sort

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Speaker 1: of investors. Now, I know a lot of listeners are

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Speaker 1: quite skeptical of why are we talking about Elon Musk,

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Speaker 1: Why are we talking about Twitter? Yes? Again, but this

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Speaker 1: is fascinating because a lot of may US banks firepower

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Speaker 1: to back other deals is tied up in this debt story.

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Speaker 1: More than Stanley, the lead bank, have eight hundred million

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Speaker 1: dollars tied up, and then Bank of America, Barclays, a

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Speaker 1: m U f G all have about six hundred millions.

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Speaker 1: So this monster of a deal is actually tied up

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Speaker 1: a lot of other capital that could otherwise be used

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Speaker 1: to finance other things. Okay, sta'ts in the Wall Street

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Speaker 1: Journal Morgan Stanley. Next, this isn't the Financial Times. Morgan

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Speaker 1: Stanley hits bankers with one million dollars and penalties from

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Speaker 1: messaging breachers. Now, I mean, this is longer the story,

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Speaker 1: even before the pandemic. But the working from home explosion

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Speaker 1: really made in a problem for regulators about how we

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Speaker 1: track what bankers and traders are doing off sort of

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Speaker 1: official designated platforms and on sort of personal messaging apps.

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Speaker 1: Two years ago, regulators made that problem a bank problem

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Speaker 1: with almost a billion dollars in fees. Now banks are

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Speaker 1: making it your problem, ranging it from sort of a

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Speaker 1: few thousand dollars to more than a million dollars per individual.

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Speaker 1: Morgan Stanley is putting out penalties to your bonus packets

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Speaker 1: and your future pay packets if you break their rules,

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Speaker 1: and that depends on, say, the number of messages you've

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Speaker 1: sent your seniority as a banker, and whether you have

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Speaker 1: kind of prior warnings on it. Now, they're not saying

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Speaker 1: stop using WhatsApp completely, they're running training sessions of like

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Speaker 1: when say a harmless conversation may move into say, let's

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Speaker 1: set up a meeting, and that's kind of the point

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Speaker 1: where they would say you should bring this back onto

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Speaker 1: official channels otherwise you risk being sort of caught liable

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Speaker 1: and then being fined by the bank. Okay, so that yeah,

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Speaker 1: it's not just so it's not just the social media

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Speaker 1: rules maybe that banks have, but yet they're fines. It's

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Speaker 1: not sort of firing people. So I think that's also

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Speaker 1: an interesting it's kind of not breaches, but it's actually

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Speaker 1: finding people for for not doing the right thing maybe

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Speaker 1: through these messaging apps. Yeah, very interesting FT story. Thank

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Speaker 1: you so much James Walcott for taking us through the

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Speaker 1: newspapers this morning. Well let's turn into one of the

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Speaker 1: key data points we're watching out for it later and

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Speaker 1: be the fourth quarter GDP figures from the US, Bloomberg

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Speaker 1: Economics expect to see growth of two point eight percent

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Speaker 1: and an annualized right to figure boosted by consumers spending

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Speaker 1: on services from more. Let's bring in our executive editor

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Speaker 1: for Asian Markets, Paul Dubs and Paul, great to have

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Speaker 1: you with us. What are the key thing things that

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Speaker 1: we are watching out for in today's data? The survey

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Speaker 1: estimate at two point six percent growth Bloomberg Economics as

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Speaker 1: two point eight percent. Yeah, absolutely, so we're looking at

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Speaker 1: a bit of a slowdown from the last quarter, but

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Speaker 1: at the same time fairly robust headline figure at least,

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Speaker 1: you know, and I guess you know, the way that

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Speaker 1: the market is reacting to the data at the moment,

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Speaker 1: the better. It is the worst news for markets in

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Speaker 1: a way that's still tied to this idea that you know,

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Speaker 1: if the data can remain robust, then the Federal Reserve

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Speaker 1: will need to continue to tighten and then hold interest

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Speaker 1: rates higher in order to in order to cause more

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Speaker 1: other of you know, sort of bring down the inflation

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Speaker 1: pressures in the economy and get things back on and

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Speaker 1: even keel there as well. So so in terms of

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Speaker 1: the headline at least, as it's all about where we

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Speaker 1: price relative to expectations, and then you know the market

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Speaker 1: will run with it from there. Yeah. Um, so there's

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Speaker 1: a big US days dump to day g dps obviously backward,

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Speaker 1: but we also get jobless claims later. What should we

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Speaker 1: expect there? Yeah, well, and this is part of that

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Speaker 1: whole conundrum for investors right now when they're looking at

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Speaker 1: the economic data and they're sort of throwing things forwards

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Speaker 1: a little bit, you know, as as you were saying,

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Speaker 1: we've got a very strong and robust consumer and a

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Speaker 1: very strong robust labor market, but the companies themselves are

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Speaker 1: feeling that they're under pressure. And if you look at

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Speaker 1: the survey data, is we can pointing to a big

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Speaker 1: slowdown as well. So people will be looking at the

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Speaker 1: labor data the claims are pretty carefully. We've seen a

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Speaker 1: little bit um or of a relaxation recently, you know,

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Speaker 1: kind of like a bit of a more buoyant picture

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Speaker 1: in the job space. So today's forecast is for is

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Speaker 1: for an increasing claim so a little bit more pressure

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Speaker 1: coming back in there, and they will play into that

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Speaker 1: sort of dynamic that the people are trying to get

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Speaker 1: their heads around when they're thinking about how fast the

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Speaker 1: economy is slowing and how far it's likely to slow. Um. Okay, Paul.

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Speaker 1: In terms of the Bank of Canada's decision yesterday and

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Speaker 1: the market reaction, the bank says it's got to it's

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Speaker 1: hiked rates, now it's going to hold. What should we

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Speaker 1: take away from that and the potential influence that might

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Speaker 1: have on the Fed? Yes, So I think the thing

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Speaker 1: that is really important and significant to hear the first

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Speaker 1: of the central banks kind of like being pretty emphatic

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Speaker 1: in the fact that they want to stop now and

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Speaker 1: take a rain check, see how things are going. You know.

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Speaker 1: I think for the for the FED, we're definitely pricing

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Speaker 1: for a twenty five basis point hike UM in the

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Speaker 1: coming week and then maybe one more after that before

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Speaker 1: we slow. But that's not fully in the price now.

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Speaker 1: So people are starting to look forward to that moment

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Speaker 1: when the FED stops hiking. As well. The fact that

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Speaker 1: the Bank of Canada is confident enough in the slowdown

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Speaker 1: and inflation to make that stateman today. UM will certainly

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Speaker 1: have read across for the US markets as well, Paul,

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Speaker 1: thank you so much for being with us. That is

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Speaker 1: our executive editor for Asia Markets, pauled Dobson Looking ahead

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Speaker 1: to the US GDP. Let's get you an update then

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Speaker 1: on our top stories and world news. His bloom Bags

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Speaker 1: James Hawcock, Good morning, Good morning. China says the number

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Speaker 1: of COVID related deaths and severe cases at hospitals has

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Speaker 1: declined by more than seventy percent from peak levels in

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Speaker 1: early January. As of Monday, official daily fatalities at hospitals

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Speaker 1: to eight hundred and ninety six, down from a high

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Speaker 1: on January four of more than four thousand. The true

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Speaker 1: number maybe hundreds of thousands higher than the official figure,

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Speaker 1: which only counts deaths in hospitals. And global smartphone shipments

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Speaker 1: have suffered their worst quarterly drop on record in the

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Speaker 1: final three months of last year. Shipments declined by eighteen

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Speaker 1: point three percent in the December quarter, in a clear

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Speaker 1: sign of cooling consumer demand. The news signals there's more

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Speaker 1: pain to come for manufacturing hubs like South Korea and Vietnam.

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Speaker 1: In the US, there is growing support from politicians to

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Speaker 1: completely banned TikTok in the country. Republicans armed to Josh

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Speaker 1: Hawley has induced legislation to prohibit the Chinese own company

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Speaker 1: from all devices nationwide. The concern from lawmakers is that

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Speaker 1: TikTok and its parent Bite Dance could share information on

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Speaker 1: US users with Chapneys authorities. This is Bloomberg Daybreak Europe,

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