Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg
Speaker 1: Daybreak Europe podcast. Good morning, It's Monday, the tenth of August.
Speaker 1: I'm Stephen Carroll in London. Coming up today. A brighter
Speaker 1: economic outlook and stronger earnings are changing investors' views of Europe.
Speaker 1: Iran promotes a former military commander to its top security
Speaker 1: role as Tehran rules out direct talks with the US.
Speaker 1: Plus luxury cars, boy bands and stacks of cash. What
Speaker 1: an extravagant twenty million dollar wedding says about Zimbabwe's new
Speaker 1: generation of tycoons. Let's start with a roundup of our
Speaker 1: top stories. Europe's economic outlook is set to improve in
Speaker 1: the coming months after proving surprisingly resilient to the effects
Speaker 1: of the Iran War. After a stronger than expected second quarter,
Speaker 1: a Bloomberg survey of analysts has now raised its Eurozone
Speaker 1: growth forecast to zero point eight percent for the year,
Speaker 1: up from zero point five percent in July. That resilience
Speaker 1: is also showing up in European stock markets, as companies
Speaker 1: across the continent deliver their best earnings growth in four years.
Speaker 1: The stock six hundred is up eleven percent this year,
Speaker 1: and on a forward earnings basis, is now at its
Speaker 1: smallest discount to the S and P five hundred since
Speaker 1: twenty twenty two. Madelin Runners, senior portfolio manager at DWS.
Speaker 2: This one was one of the best earning seasons that
Speaker 2: we have seen in Europe for quite a while. And
Speaker 2: it's a pretty promising picture because, yes, expectations have been
Speaker 2: higher than in recent quarters, but they're still not quite
Speaker 2: as high as, for example, in the US, so there's
Speaker 2: still more room for upside surprises as well as expectation
Speaker 2: beats and raises.
Speaker 1: Madeal and Honnors. Sentiment has reflected more broadly, with surveys
Speaker 1: showing that many fund managers have shifted from underweight Europe
Speaker 1: to overweight. Iran has named hardline former Revolutionary Guard commander
Speaker 1: Mohsen Rese as its top national security official. The move
Speaker 1: comes as Iran says an agreement with Oman on a
Speaker 1: shipping route through the Straight a Wour moves is very close.
Speaker 1: Our Middle East correspondent to Bier Abu Omar says Tehran
Speaker 1: has ruled out direct talks with the US for now.
Speaker 3: Ron maintains that Washington is not a part of those discussions.
Speaker 3: Despite what we've heard from President Trump and the Vice
Speaker 3: president about them being part of those discussions. Iron maintains
Speaker 3: that mediators, assumingly Qatar at this point are the ones
Speaker 3: that are delivering messages. We also understand that Qatar is
Speaker 3: doing its own draft to start mediating to have those
Speaker 3: wider discussions, but for the time being, her moosse Sase paralyzed.
Speaker 3: Pretty much a text continue to happen, and we don't
Speaker 3: have a formalized draft between Ron and Rman about that deal.
Speaker 1: A bia Aba Omar, speaking there as President Trump says
Speaker 1: he's prepared to allow economic pressure on around to mount
Speaker 1: rather than launch a new military offensive. Speaking to Axios,
Speaker 1: Trump claims the US is quote low keying it and
Speaker 1: semi negotiating with Tehran, which he says is in very
Speaker 1: bad shape economically. Remarks follow weeks of threats of massive
Speaker 1: air strikes that Trump that has then repeatedly called off.
Speaker 1: The alleged leader of an Irish organized crime gang has
Speaker 1: been extradited to Dublin from Dubai. Daniel Kinahan landed in
Speaker 1: Ireland yesterday, where he was charged with directing the activities
Speaker 1: of a criminal organization at a special court sitting Arlands Tschakmiehill.
Speaker 1: Martin highlighted the joint efforts involved in the extradition operation.
Speaker 4: I pittribute to the authorities in the United Arab Emirates
Speaker 4: for the strong cooperation with Ireland over recent years in
Speaker 4: this field.
Speaker 1: More generally, it's Arland t shok Mee Hill Martin. Following
Speaker 1: the court here in, Kinahan was remanded in custody at
Speaker 1: a high security prison in Port Lisia, ninety miles southwest
Speaker 1: of the capital. His next court appearance is scheduled for October.
Speaker 1: Hiring in the UK is turning a corner after its
Speaker 1: longest slump on record. Data from the Recruitment and Employment
Speaker 1: Confederation shows the number of people getting permanent jobs holding steady.
Speaker 1: That's after forty five straight months of declines, but the
Speaker 1: organization warrants that any recovery would depend on the decisions
Speaker 1: new Prime Minister Andy Burnham makes in his October budget.
Speaker 1: AI bootcamp courses they're surging in popularity as workers race
Speaker 1: to learn new skills. The news comes as new research
Speaker 1: shows the number of employers who expect entry level recruits
Speaker 1: to be AI competent has tripled in Brooks Ta out
Speaker 1: of Bio has more.
Speaker 5: Before the launch of chat GPT, just two percent of
Speaker 5: the professional certificate market was focused on AI. Now, short
Speaker 5: term AI training programs, often called boot camps, have exploded
Speaker 5: to nearly a third of the credential market, according to
Speaker 5: Workforce Database for Velio Labs. Some businesses are even willing
Speaker 5: to foot the bill to prepare their teams for what
Speaker 5: they see as a fast approaching future. According to the
Speaker 5: National Association of Colleges and Employers, anxiety about AI has
Speaker 5: surged along with demand for quick training programs. Meanwhile, universities
Speaker 5: are beginning to offer AI courses to everyone from C
Speaker 5: suite executives to software engineers as they face declining enrollments
Speaker 5: and threats to their business model. In London, to You
Speaker 5: added Bio Bloomberg Radio.
Speaker 1: And a multi million pound energy project was diverted in
Speaker 1: Britain because of Harry Potter fans. The four hundred and
Speaker 1: thirty million pounds green Link interconnector joins the UK's national
Speaker 1: grid to Ireland's and came online last year. Brooks James
Speaker 1: Wilcock has the story.
Speaker 6: Modern technology can sometimes feel like magic, but listening to
Speaker 6: green Link's form of project managers Simon Ludlam talk on
Speaker 6: the Energy Revolution podcast about building it.
Speaker 7: It may be more of a curse. Apparently we're going
Speaker 7: to go straight through Dobby's grave, And said, Dobby, who's Dobby?
Speaker 7: And they said Dobby, Dobby. I don't know Dobby, and
Speaker 7: so fored Dobby and Harry Potter you pointed out very
Speaker 7: clearly where his grave was and that the cable's going
Speaker 7: to go directly through it. And I said, well, it's
Speaker 7: a fictitious character in a fictitious book. The whole thing's fictitious.
Speaker 7: What are you talking about, No, sod, it's very very serious.
Speaker 6: He was speaking there to the Energy Revolution podcast. As
Speaker 6: Britain wrestles with how costly and complex it has made construction.
Speaker 6: Every UK mega project since nineteen eighty has been over
Speaker 6: budget and the majority have been delivered later than planned.
Speaker 6: The challenge for Britain is how to make infrastructure as
Speaker 6: popular as its fictional characters in London, sadly not Platform
Speaker 6: ninety three quarters James Wacock, Bloomberg.
Speaker 1: Radio, and those are your top stories on the markets
Speaker 1: this morning. The MSAL Country World Index upper tenth of
Speaker 1: one percent this morning. Global stocks hovering near record highs.
Speaker 1: The Nikki and Tokyo by nearly two percent. European stock
Speaker 1: features just pointing ever so slightly higher this morning as
Speaker 1: we're watching the dollar on the Bloomberg Dollar Spot Index
Speaker 1: up a tenth of one percent, on the Japanese en
Speaker 1: weakening further one hundred and fifty eight thirty two against
Speaker 1: the dollar. Oil and gas prices are slightly higher as well.
Speaker 1: Brent Krute is just close to eighty four dollars a barrel.
Speaker 1: Well in a moment, more on that brighter picture for
Speaker 1: Europe's economy and markets, plus what a lavish wedding in
Speaker 1: Zimbabwe tells us about those who hold power in the country.
Speaker 1: But first, another story that caught our eye this morning
Speaker 1: on investing in YouTubers. Bloomberg opinion Columnst. Lionelle A Round
Speaker 1: has been speaking to the founder of the investment firm Nugget,
Speaker 1: which is putting five million pounds into British YouTubers, believing
Speaker 1: they're an underserved asset. Nugget founder Jarathan Friedland has picked
Speaker 1: creators like only Scran's John O. Yates to back. His
Speaker 1: firms offer a mix of capital, investment and access to
Speaker 1: tools to these creators for them to boost growth. And
Speaker 1: he's not alone in wanting to invest in these creators.
Speaker 1: The so called creator economy covering platforms like TikTok and Instagram,
Speaker 1: is projected by Goldman Sachs to grow to four hundred
Speaker 1: and eighty billion dollars by twenty twenty seven. That'll be
Speaker 1: up from two hundred and fifty billion dollars in twenty
Speaker 1: twenty three. Now, Lionel writes, this does feel like a
Speaker 1: genuine tipping point for creators, as the more frothy and
Speaker 1: fake influencer accesses fall by the wayside and regulators clean
Speaker 1: up the space as well. It's also being driven by
Speaker 1: the increased dominance of YouTube as a video platform. But
Speaker 1: Lionnel points out, when it comes to an investment point
Speaker 1: of view, the difficulty about niches as their tricky to scale.
Speaker 1: Nobody's clear about how you can necessarily scale investment in
Speaker 1: what can be a very fickle Internet space. The concerns
Speaker 1: that investors might have what if bad creator behavior could
Speaker 1: damage a brand, burnout if it's all based on one
Speaker 1: person or even ai, and will money getting in behind
Speaker 1: these creators destroy their niche outlook? Perhaps the arrival of
Speaker 1: investors could taint them as well, So a minefield for investors.
Speaker 1: But a really interesting read this morning about who is
Speaker 1: putting money into this space. We'll put a link to
Speaker 1: it in our podcast show notes. Well, let's bring you
Speaker 1: more now on the brightening outlook for the European economy
Speaker 1: and stock market in spite of the continuing geopolitical turmoil
Speaker 1: in the Middle East. Garfield Reynolds, who leads our market's
Speaker 1: live team in Asia, joins us now from more Garfield,
Speaker 1: we're looking at this Bloomberg survey of analysts showing zeros
Speaker 1: and economy proving more resilient to the effects of the
Speaker 1: Iran War. How much of an upgrade is this, Well.
Speaker 8: It's a pretty substantial one. The interesting thing is is
Speaker 8: that a lot of it is about that second quarter,
Speaker 8: which was when the war happened, or at least when
Speaker 8: the biggest impacts from the war happened. That's when crude
Speaker 8: oil prices jumped substantially. That's when there was a lot
Speaker 8: of concern about what the impact was going to be
Speaker 8: on the global economy and especially about Europe, which after
Speaker 8: all is fairly dependent on energy. But instead, I think
Speaker 8: you're partly helped by the massive release of stockpiles of
Speaker 8: oil and gas and also the lingering impact of Europe's
Speaker 8: shift towards spending significantly more on defense, and that of
Speaker 8: course is a shift that got an extra boost from
Speaker 8: what went on what's going on in the Middle East.
Speaker 8: Europe is surprised by the just how strong its economy is,
Speaker 8: which also is something that matches the lots of things
Speaker 8: that are going on the global economy in general, partly
Speaker 8: because of the impact of AI, partly because of those
Speaker 8: efforts to smooth the impact of the war. The global
Speaker 8: economy is chucking along reasonably well, and Europe is standing
Speaker 8: out as part of that.
Speaker 1: And this is also translating into a boost for European
Speaker 1: stock markets despite the limited exposure to the AI trade
Speaker 1: that's been driving driven driving stock markets higher elsewhere as well.
Speaker 1: Can that momentum last if we look towards the rest
Speaker 1: of the year.
Speaker 8: Well, there's the potential for that momentum to actually accelerate,
Speaker 8: because what we're what's going on at the moment is
Speaker 8: precisely that investors are taking into account the potential that
Speaker 8: the companies and countries sectors that are going to reap
Speaker 8: the benefits of the AI boom are not necessarily those
Speaker 8: that make AI as much as they could well be
Speaker 8: those who buy it or those who buy it in
Speaker 8: an intelligent fashion, those who might have more potential to
Speaker 8: benefit from doing things. There was a piece recently about
Speaker 8: the impact of AI showing up in parts of the
Speaker 8: US as garbage companies were seeing their profits increase because
Speaker 8: they were finding ways to increase efficiency. Now, I'm not
Speaker 8: trying to make any analogy about what sort of companies
Speaker 8: there might be in Europe that would do well, but
Speaker 8: there are lots of ordinary bricks and mortar, whether it's consumers,
Speaker 8: whether it's factories, you know, regular businesses in Europe. There's
Speaker 8: no reason why they can't benefit at least as much
Speaker 8: from AI as some of the shinier examples in the US.
Speaker 8: And they aren't busy spending the enormous amounts of capex
Speaker 8: that the hyperscalers are, which those hyperscales and that capex
Speaker 8: those other things that in versus are more concerned at. Now,
Speaker 8: what they're looking for are where are the places that
Speaker 8: are going to reap greater benefits, quite possibly without spending
Speaker 8: as much money as somebody like Meta is for example.
Speaker 1: Yeah, really interesting stuff. Garfield, thanks very much for bringing
Speaker 1: us details of our latest Bloomberg survey, but also that
Speaker 1: outlook for stocks and how the AI trade plays into
Speaker 1: the outlook for European shares as well. Garfield Reynolds there,
Speaker 1: who leads our market's live team in Asia. Stay with
Speaker 1: us more from Bloomberg Daybreak Europe coming up after this.
Speaker 1: Let's get a Zimbabwe next, where an extravagant wedding that
Speaker 1: happened in May is revealed the new generation of tycoons
Speaker 1: who wield power in the country. It's an illustration of
Speaker 1: how much has changed at a president Emerson man and
Speaker 1: Gagwe since he came to power in twenty seventeen. Our
Speaker 1: senior Africa reporter Anthony's Cuisine joins us now for more. Anthony,
Speaker 1: Who was that this web and what does it show
Speaker 1: us about the group of people who run Zimbabwe?
Speaker 9: I meanes the guest list of the wedding was basically
Speaker 9: a who's who of all the power brokers who do
Speaker 9: business with government through state contracts, gold traders because that's
Speaker 9: been a big boom industry in Zimbabwe and also most ministers,
Speaker 9: senior government officials, people in the treasury. So really it
Speaker 9: was the political and economic elite of Zimbabwe and what it.
Speaker 1: Does show is that.
Speaker 9: A country net for decades under Rob mcgarby was run
Speaker 9: very tightly by a clique of former war veterans who
Speaker 9: fought in the guerrilla war against the Rhodesian government. They're
Speaker 9: beginning to get a bit older. Some of them are
Speaker 9: no longer active, some have passed away, and what we
Speaker 9: are getting now is a bunch of younger, business oriented
Speaker 9: tycoons who are wielding a lot of power and are
Speaker 9: now entering politics. They have senior positions in the ruling
Speaker 9: party and as the story today shows, they actively bankrolled
Speaker 9: a campaign to extend the president's time in power, which
Speaker 9: is advantage to themselves as under the current regime they
Speaker 9: are getting a lot of government contracts.
Speaker 1: More broadly, how does this regime under President Managagua differ
Speaker 1: from that of Robert mccaby.
Speaker 9: Look, Rod mccaby's regime was much maligned because the economy collapsed,
Speaker 9: there was some corruption and a few scandals, but mccavey
Speaker 9: was very ideological. He was a Marxist and he keept
Speaker 9: a very very tight control over the ruling party, ruled
Speaker 9: it with a mind fist and generally cabinet members does
Speaker 9: not step out of line he was a very disciplined man.
Speaker 9: Teetotler kept himself very physically fit right until the end
Speaker 9: of his life, and he absolutely abhored flagrant displays of
Speaker 9: oscentatious displays of wealth, you know, driving expensive cards, holding
Speaker 9: wedding like this where you know the list of gifts
Speaker 9: exceeded twenty million dollars.
Speaker 1: What state is Zimbabwe's economy in now?
Speaker 5: Then?
Speaker 1: Given that it has course been subject to such a
Speaker 1: long period of crisis, so what is economy is a mess?
Speaker 9: It is the longest defaulting country to the World Bank,
Speaker 9: for instance, since nineteen ninety nine or two thousand round
Speaker 9: above there it hasn't paid its debts. It's twenty billion
Speaker 9: dollars odd in debts in our unemployment is enormous. Roughly
Speaker 9: a quarter of the population has left for economic reasons.
Speaker 9: Many of those now live in South Africa or the UK.
Speaker 9: And generally for an ordinary Zimbabwean it's very, very difficult
Speaker 9: to get ahead.
Speaker 1: State infrastructure has largely collapsed.
Speaker 9: So you know you have in a city like Arari,
Speaker 9: the capital, people provide their own water, they provide their
Speaker 9: own power, and the streets are largely unserviceable. Aside from
Speaker 9: a few main highways, so it's in a very poor stick.
Speaker 1: Thanks for listening to Bloomberg Daybreak Europe.
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