WEBVTT - Bloomberg Daybreak: October 18, 2022 - Hour 2 (Radio) 0:00:03.360 --> 0:00:06.560 Live from the Bloomberg Interactive Brooker Studios. This is Bloomberg 0:00:06.640 --> 0:00:10.760 day Break for Tuesday, October eighteen two. Coming up this shour, 0:00:11.119 --> 0:00:15.480 stocks extend yesterday's rally on Wall Street. Callman Sachs wraps 0:00:15.560 --> 0:00:19.160 up bank earnings. Letz Trust's apologizes but vows to stay 0:00:19.160 --> 0:00:21.759 on as UK Prime Minister, and the White House could 0:00:21.760 --> 0:00:25.040 release more oil from its emergency stock pile. It was 0:00:25.120 --> 0:00:28.320 debate night in several key races, plus a new policy 0:00:28.400 --> 0:00:31.200 from the New York Seditation Department is making the rats say, 0:00:31.360 --> 0:00:34.840 Oh rats, I'm Michael Barr Morris. Fight ahead, I'm John 0:00:34.840 --> 0:00:37.480 Stashoward Spurt. The Yankees and Guardians were rained out. They'll 0:00:37.479 --> 0:00:39.960 play Game five at four o'clock today. The Rangers beat 0:00:40.000 --> 0:00:45.040 the Ducks. The Chargers beat the Bronco. That's all s 0:00:45.080 --> 0:00:48.360 train ahead on Bloomberg day Break on Bloomberg. He Live 0:00:48.440 --> 0:00:51.960 in Free on New York, Bloomberg one, Washington, d C, 0:00:52.440 --> 0:00:56.720 Bloomberg one oh six one, Boston, Bloomberg nine sixties, San Francisco, 0:00:57.200 --> 0:01:00.240 Syrius XM one nineteen and around the world Old on 0:01:00.400 --> 0:01:07.560 Bloomberg Radio dot Com and the Bloomberg Business app. And 0:01:07.720 --> 0:01:10.520 good morning, I'm far at Moscow. I'm Nathan Hager. Bloomberg 0:01:10.600 --> 0:01:13.360 Daybreak is brought to you by SEI. Asset managers don't 0:01:13.360 --> 0:01:15.560 get results that are off the charts when their solutions 0:01:15.560 --> 0:01:18.360 are off the shelf. Learned how SEI is operating platform 0:01:18.400 --> 0:01:21.720 can turn infrastructure into a competitive advantage at s E 0:01:21.920 --> 0:01:25.119 i C dot Com, Slash Tech and futures are higher 0:01:25.120 --> 0:01:26.960 this morning six o one on Wall Street, and we 0:01:27.040 --> 0:01:29.520 checked the markets every fifteen minutes throughout the trading day 0:01:29.600 --> 0:01:32.399 on Bloomberg. Right now, SNP futures are up about fifty 0:01:32.400 --> 0:01:35.840 points down, futures up three hundred fifteen, NASDACK futures up 0:01:35.920 --> 0:01:39.400 one five ten year treasury down to thirty seconds, yield 0:01:39.440 --> 0:01:41.880 four point two percent, and the yield on the two 0:01:41.959 --> 0:01:45.200 year four point four four percent, and NIMEX screwed oil 0:01:45.360 --> 0:01:47.440 is down about three tenths of up percent to eighty 0:01:47.440 --> 0:01:50.440 five one cents a barrel Nathan Well Karen. The rise 0:01:50.480 --> 0:01:53.680 in futures follows yesterday's powerful rally on Wall Street. The 0:01:53.800 --> 0:01:56.640 SNP five hundred game two point seven percent, while the 0:01:56.640 --> 0:02:00.080 tech heavy nasdacs surged three point four percent. David the 0:02:00.280 --> 0:02:03.360 senior investment strategist at Peapack Private Wealth says it was 0:02:03.400 --> 0:02:05.720 only a matter of time for a bounce. We don't 0:02:05.760 --> 0:02:09.119 know whether we've seen the bottom in the secrecal downturn, 0:02:09.320 --> 0:02:12.400 but we do know that the conditions are primed for 0:02:12.880 --> 0:02:15.120 better returns going forward. I mean, we start with the 0:02:15.160 --> 0:02:17.840 fact that we're down twenty five percent year to date 0:02:17.960 --> 0:02:22.920 on the broad market. On the NASTAC that alone should 0:02:23.160 --> 0:02:25.960 with the appetite of all bargain hunters. David Deeds at 0:02:26.000 --> 0:02:29.200 Peapack Private Wealth notes the sp closed above a key 0:02:29.240 --> 0:02:32.919 technical support level yesterday. Still Nathan stocks have further room 0:02:32.919 --> 0:02:35.680 to fall. That's according to the latest fund manager survey 0:02:35.760 --> 0:02:38.760 from Bank of America. Their respondents expect stocks to bottom 0:02:38.760 --> 0:02:40.679 in the first half of next year after the FED 0:02:40.720 --> 0:02:43.920 finally pivots away from hiking rates. Right now, according to 0:02:43.919 --> 0:02:46.440 the survey, investors have six point three percent of their 0:02:46.440 --> 0:02:49.520 portfolios in cash, as the highest level since April of 0:02:49.560 --> 0:02:54.680 two thousand one. Participants are underweight equities in Europe. Today, Karen, 0:02:54.680 --> 0:02:57.079 we are hearing from Liz Trust, the UK Prime Minister, 0:02:57.160 --> 0:02:59.880 says she's sorry for going too far, too fast after 0:03:00.120 --> 0:03:02.920 new Chancellor gut it. Most of our economic plan. We 0:03:03.000 --> 0:03:07.880 have made mistakes. I'm sorry for those mistakes. But I've 0:03:07.919 --> 0:03:11.800 fixed the mistakes. I've appointed a new chancellor. We have 0:03:12.080 --> 0:03:16.440 restored economic stability and fiscal discipline. What I now want 0:03:16.480 --> 0:03:18.840 to do is go want to deliver for the public. 0:03:19.160 --> 0:03:21.560 Prime Minister List Trust made the comments in an interview 0:03:21.560 --> 0:03:24.320 with the BBC. One other note this morning, the Financial 0:03:24.360 --> 0:03:26.760 Times is reporting the Bank of England will likely delay 0:03:26.840 --> 0:03:29.640 its planned sale of government bonds on October thirty one, 0:03:29.800 --> 0:03:32.600 but the Bank of England is refuting that report well 0:03:32.600 --> 0:03:34.639 back here in the US, Nathan, We wrap up earning 0:03:34.720 --> 0:03:37.800 from the big banks today with Goldman Snacks reporting this morning, 0:03:37.800 --> 0:03:41.040 and here with the preview is Bloomberg's Jeff Bellinger. Goldman's 0:03:41.080 --> 0:03:44.080 revenue and profit were boosted by investment games in the 0:03:44.160 --> 0:03:47.720 third quarter last year. Bloomberg Intelligence expects to hear that 0:03:47.760 --> 0:03:50.560 the numbers were lower in the just ended quarter, which 0:03:50.600 --> 0:03:53.440 saw a slide and banking fees and a stock market 0:03:53.480 --> 0:03:57.760 performance that likely weighed on its asset management business. Investors 0:03:57.760 --> 0:04:00.280 will be interested in what executives have to say about 0:04:00.280 --> 0:04:04.000 the future. Bloomberg reported last month that Goldman was beginning 0:04:04.000 --> 0:04:06.400 the biggest round of job cuts since the start of 0:04:06.480 --> 0:04:10.400 the pandemic, and just Yesterday, Wells Fargo analyst Mike Mayo 0:04:10.520 --> 0:04:15.680 said Goldman is planning a major reorganization. Jeff Bellinger, Bloomberg Daybreak. 0:04:15.880 --> 0:04:18.440 Thanks Jeff. Goldman's earnings come a day after Bank of 0:04:18.480 --> 0:04:21.920 America reported its highest quarterly net interest income in at 0:04:22.000 --> 0:04:24.680 least a decade. We caught up with CEO Brian moynihan, 0:04:24.680 --> 0:04:27.440 who says the U. S. Consumer is still spending. Their 0:04:27.480 --> 0:04:30.159 credit quality and a credit quality Bank of America in 0:04:30.200 --> 0:04:33.320 our consumer books is very strong. Across the board. The 0:04:33.360 --> 0:04:36.640 payment the delinquencies are much slower. They weren't pay pandemic, 0:04:36.920 --> 0:04:39.120 much lower they were in any average five best year 0:04:39.160 --> 0:04:41.760 type period. And yes they moved a little bit off 0:04:41.800 --> 0:04:44.000 the floor, but they're still much lower they've been. So 0:04:44.480 --> 0:04:47.359 consumers are spending, they have money, they're employed, you can 0:04:47.400 --> 0:04:50.760 see the unemployment numbers, and they have good credit. Bank 0:04:50.760 --> 0:04:53.360 of America CEO Brian moynihan made the comments in an 0:04:53.360 --> 0:04:56.880 interview with Bloomberg's David Weston meantime, Nathan, we're seeing many 0:04:56.920 --> 0:05:00.279 companies try to diversify their leadership ranks, but that effort 0:05:00.279 --> 0:05:02.680 it could be getting harder as women leave top tier 0:05:02.760 --> 0:05:05.800 jobs at higher rates than ever before. A report from 0:05:05.880 --> 0:05:08.200 Mackenzie and Len and dot Org finds that for every 0:05:08.200 --> 0:05:10.920 woman who gets promoted at the director level, two women 0:05:11.000 --> 0:05:14.200 choose to leave. A lack of affordable childcare as part 0:05:14.240 --> 0:05:16.800 of the reason. Also, a gender pay gap that had 0:05:16.839 --> 0:05:20.159 been narrowing before the pandemic is now stalling. Well, let's 0:05:20.160 --> 0:05:22.640 turn to Washington now, Karen. The White House is watching 0:05:22.760 --> 0:05:26.320 energy prices closely, and we're told the Biden administrations making 0:05:26.320 --> 0:05:29.160 moves to ensure the price of gas doesn't go even higher. 0:05:29.360 --> 0:05:33.120 Amy Morris has the details from our Bloomberg newsroom in Washington. 0:05:33.480 --> 0:05:36.240 Energy Department officials have been quietly meeting this week with 0:05:36.279 --> 0:05:39.279 oil companies to let them know what to expect. Sources 0:05:39.320 --> 0:05:42.000 tell Bloomberg News officials are prepared to release up to 0:05:42.040 --> 0:05:45.320 fifteen million barrels of oil from the nation's emergency stockpile 0:05:45.400 --> 0:05:48.400 to keep prices steady. We also expect to hear plans 0:05:48.400 --> 0:05:51.360 from the Biden administration this week about how to replenish 0:05:51.400 --> 0:05:54.760 that stockpile. Also, the administration is looking at limiting fuel 0:05:54.839 --> 0:05:58.320 exports to keep more gasoline and diesel inside the US, 0:05:58.320 --> 0:06:00.719 a more dramatic step that sort to say would not 0:06:00.839 --> 0:06:05.080 happen before the midterms in Washington. I'm anymore as Bloomberg daybreak. Okay, 0:06:05.320 --> 0:06:08.520 thanks in checking all prices now, Nimex crews dropping a bit, 0:06:08.560 --> 0:06:11.080 down two tenths per cent at eighty five twenty nine 0:06:11.120 --> 0:06:13.719 cents of barrel. Brent is down one tenth per cent 0:06:13.760 --> 0:06:17.640 at ninety nine cents. Well in the geo political stage 0:06:17.680 --> 0:06:20.719 this morning, Nathan, China and Taiwan are in focus the 0:06:20.839 --> 0:06:23.200 US as Beijing can move to seize Taiwan and a 0:06:23.279 --> 0:06:26.760 much faster timeline and previously thought and Bloomberg said, Baxter 0:06:26.880 --> 0:06:30.240 has the story. Secretary of State Anthony Blincoln is responding 0:06:30.240 --> 0:06:33.080 to Shi Jumping's addressed to the People's Congress over the weekend. 0:06:33.400 --> 0:06:35.839 B Lincoln says there's been a change in the approach 0:06:35.839 --> 0:06:38.920 over the past several years towards Taiwan, but says now 0:06:39.080 --> 0:06:42.520 China has made a fundamental decision that the status quo 0:06:42.760 --> 0:06:46.600 is no longer acceptable and that Beijing is determined to 0:06:46.680 --> 0:06:51.880 pursue reunification on a much faster timeline. Having said that, 0:06:51.920 --> 0:06:55.599 b Lincoln says there's eagerness to cooperate on share interest 0:06:55.880 --> 0:06:58.279 given that she will be serving a third term in 0:06:58.400 --> 0:07:01.680 San Francisco. I'm at Baxter Bloomberg daybreak at Baxter. Thank 0:07:01.760 --> 0:07:05.039 USMP futures right now are up forty nine point staff 0:07:05.080 --> 0:07:08.000 futures up three seventeen. NASTAC futures are hired by a 0:07:08.040 --> 0:07:11.480 hundred eighty six points ten. Your treasuries down one thirty second, 0:07:11.520 --> 0:07:15.160 the yield four point zero one per cent. Straight ahead, 0:07:15.160 --> 0:07:18.280 your latest local headlines and a check of sports. This 0:07:18.640 --> 0:07:25.040 is Bloomberg six oh seven on Wall Street. Now. We 0:07:25.080 --> 0:07:27.600 are at fifty degrees in Central Park. Got a crash 0:07:27.680 --> 0:07:31.240 northbound Bronx River Parkway. It's closed at Allerton Avenue. More 0:07:31.280 --> 0:07:33.320 coming up in traffic. First Michael bar with more on 0:07:33.360 --> 0:07:35.320 what's going on in New York and around the world. Michael, 0:07:35.360 --> 0:07:37.560 thank you very much. Nathan, New York City announced the 0:07:37.600 --> 0:07:40.640 new policy meant to keep the streets cleaner and free 0:07:40.680 --> 0:07:43.800 of rats. With trash bags piled on the curbs at night. 0:07:44.200 --> 0:07:46.440 There are new rules on when you can take out 0:07:46.480 --> 0:07:50.840 the garbage. Sanitation Commissioner Jessica Tish the biggest swing that 0:07:50.920 --> 0:07:53.760 you can take at cleaning up our streets is to 0:07:53.880 --> 0:07:57.480 shut down the all night, all you can eat rat buffet. 0:07:58.400 --> 0:08:02.200 I want to be clear, the rats are absolutely going 0:08:02.240 --> 0:08:06.280 to hate. This announcement, Sanitation Commissioner Tish said buildings can 0:08:06.280 --> 0:08:08.680 put their trash out no earlier than eight pm, and 0:08:08.720 --> 0:08:13.960 there will be more collections overnight. New York City arts organizations, 0:08:13.960 --> 0:08:17.560 including the Metropolitan Opera and Carnegie Hall, announced that they 0:08:17.600 --> 0:08:22.400 will make face masks optional beginning October as COVID nineteen 0:08:22.440 --> 0:08:25.920 cases continue to decline across the area. The group added 0:08:25.920 --> 0:08:29.120 that it will continue to encourage the practice of masking 0:08:29.560 --> 0:08:34.240 and vaccinations, which also remain optional. Georgia Governor Brian Kemp 0:08:34.280 --> 0:08:38.840 faced Democratic challengers Stacy Abrams and Libertarian candidate Shane Hazel 0:08:38.880 --> 0:08:43.199 for a televised debate sponsored by the Atlanta Press Club. Abrams, 0:08:43.200 --> 0:08:46.240 speaking last night, as governor, I intend to stand up 0:08:46.240 --> 0:08:48.120 for the right to vote. I will always acknowledge the 0:08:48.120 --> 0:08:50.880 outcome of elections, but I will never deny access to 0:08:51.000 --> 0:08:53.840 every voter, because that is the responsibility of every American 0:08:54.000 --> 0:08:56.840 to defend the right to vote. Kemp responded to Abram's 0:08:56.880 --> 0:09:00.520 accusations of voter suppression during his time as governor. I'm 0:09:00.520 --> 0:09:04.480 the person that created the online voter registration system in 0:09:04.559 --> 0:09:08.400 the state where any Georgian convert registered of the twenty 0:09:08.400 --> 0:09:11.480 four hours a day, seven days a week. Abraham's lost 0:09:11.520 --> 0:09:13.800 to Kemp when they first ran against each other in 0:09:13.800 --> 0:09:17.720 the twenty eighteen race for governor. Democratic Representative Tim Ryan 0:09:17.800 --> 0:09:20.680 and Republican J. D. Vans meant for their second debate 0:09:20.880 --> 0:09:25.680 to replace retiring Ohio Republican Senator Rob Portman on NBCs 0:09:25.880 --> 0:09:29.920 w FM JTV. Vans accused Ryan of voting for tax 0:09:29.960 --> 0:09:33.480 increases and criticized his support for the Inflation Reduction Act. 0:09:33.720 --> 0:09:37.319 It raises taxes by twenty billion dollars on working people 0:09:37.360 --> 0:09:39.280 in this state and in this country, and then at 0:09:39.280 --> 0:09:42.040 six seven thousand, I rst agents to go after them. 0:09:42.240 --> 0:09:46.040 Bryan replied, advances accusing him of being a follower of 0:09:46.040 --> 0:09:49.360 how speaker Nancy Pelosi. You keep talking about Nancy Pelosi. 0:09:50.080 --> 0:09:52.319 If you want to run against Nancy Pelosi, moved back 0:09:52.320 --> 0:09:55.160 to San Francisco and run against Nancy Pelosi. You're running 0:09:55.160 --> 0:09:58.560 against me. Poles projected race as a virtual time global 0:09:58.600 --> 0:10:01.240 Neames twenty four hours a day on airand on Bloomberg 0:10:01.320 --> 0:10:03.679 quick Take, powered by more than twenty seven hundred journalists 0:10:03.679 --> 0:10:05.840 and analysts in more than a hundred twenty countries. I'm 0:10:05.840 --> 0:10:12.640 Michael bar This is Bloomberg. Nathan. Thanks Michael almost six 0:10:12.679 --> 0:10:14.640 ten on All Street Time for the Bloomberg Sports Update 0:10:14.640 --> 0:10:16.920 with John stoesshown All right, Nathan. Second time in this 0:10:16.960 --> 0:10:19.520 series where the Yankees and Guardians have been reined out 0:10:19.520 --> 0:10:21.520 at the stadium, Unlike last week when the game was 0:10:21.559 --> 0:10:24.240 called early in the afternoon. The fans were there last night, 0:10:24.240 --> 0:10:26.680 but at nine thirty they called it's a game. Five 0:10:27.160 --> 0:10:29.319 is at four o'clock today, and with the day off, 0:10:29.360 --> 0:10:32.840 the Yankees are changing starting pitchers. Out is Jamison tan 0:10:32.960 --> 0:10:36.080 and in is Nestor Cortez, picking on three days rest. 0:10:36.080 --> 0:10:38.679 The Guardians could do likewise with Shane Bieber. He was 0:10:38.760 --> 0:10:40.959 the sty young winner just two years ago, but they 0:10:41.040 --> 0:10:44.439 say they are sticking with Aaron Savali the winner today. 0:10:44.559 --> 0:10:46.480 Quickly off to Houston for Game one of the a 0:10:46.640 --> 0:10:51.559 LCS tomorrow. The surprising n LCS Phillies and Padres starting 0:10:51.600 --> 0:10:53.880 tonight in San Diego, two teams who failed to win 0:10:54.040 --> 0:10:57.439 ninety games to decide the penned after three n l 0:10:57.520 --> 0:11:00.000 teams that won over a hundred games, including the Mets, 0:11:00.400 --> 0:11:02.560 were outst Week six wrapped up a f C West 0:11:02.559 --> 0:11:04.720 game in l a went over time Chargers beat the 0:11:04.720 --> 0:11:07.880 Broncos nineteen sixteen. Third great win for l A. Denver 0:11:07.960 --> 0:11:10.600 now two and four and the red Hot Jets visit 0:11:10.679 --> 0:11:12.760 the Broncos on Sunday. I mean one a f C 0:11:12.920 --> 0:11:15.559 teen was a better record than the Jets at the Garden. 0:11:15.640 --> 0:11:18.080 Rangers and Ducks. Good start for the Blue Shorts, especially 0:11:18.120 --> 0:11:23.720 with the man advantage. But theres the candile. It stacks 0:11:23.760 --> 0:11:27.240 it up. Let's start to that down low pro chack 0:11:27.280 --> 0:11:32.719 aproch about a Jets these stars. It was about a 0:11:32.840 --> 0:11:35.760 Jet shutting up tro check for the first power play goal. 0:11:36.240 --> 0:11:40.000 If time pro check to Sabanda, chat to the Rangers 0:11:40.000 --> 0:11:42.720 and seventy the later is the banner. Jet scored another 0:11:42.800 --> 0:11:45.760 power play goal. Rangers beat Anaheim six to four, their 0:11:45.880 --> 0:11:48.280 three and one NBA season tipping off tonight, a couple 0:11:48.320 --> 0:11:51.280 of games Nixon Nets get going tomorrow, John stash Ower, 0:11:51.320 --> 0:11:54.679 Bloomberg Sports, Nathan, Thanks John. Sp futures right now forty 0:11:54.720 --> 0:11:56.839 six points, South Feutures of tune to ninety five dance 0:11:56.920 --> 0:11:59.199 A Futures up a hundred seventy three points. We'll talk 0:11:59.200 --> 0:12:03.160 about this market next with HSBC chief multi asset strategist 0:12:03.240 --> 0:12:08.560 Max Kedner. This is Bloomberg Bloomberg eleven three oh weather 0:12:08.679 --> 0:12:12.720 clearing cooler today, highs in the upper fifties, sunny, mid fifties. Tomorrow, 0:12:13.240 --> 0:12:17.120 might hit sixty by Thursday. Right now it's fifty in 0:12:17.280 --> 0:12:24.880 Central Park. Markets. Headlines and breaking news twenty four hours 0:12:24.920 --> 0:12:27.880 a day at Bloomberg dot Com, the Bloomberg Business Out 0:12:28.000 --> 0:12:31.760 and at Bloomberg Quicktake. This is a Bloomberg Business Flash 0:12:37.520 --> 0:12:40.120 and I'm Karen Moscow. And futures are higher this morning, 0:12:40.160 --> 0:12:43.000 but SMP futures of fifty points down. Futures have three 0:12:43.080 --> 0:12:46.559 number twenty nine, and ASTA futures have on four the decks. 0:12:46.600 --> 0:12:50.240 In Germany's a one point one percent tenure treasury that'll change. 0:12:50.280 --> 0:12:52.280 He had four point one percent that yield on the 0:12:52.320 --> 0:12:54.520 two year four point four or four percent. N i 0:12:54.720 --> 0:12:56.559 X screwed oils down a tenth of upper cent or 0:12:56.600 --> 0:12:58.880 eleven cents at eighty five dollars, thirty five cents of 0:12:58.920 --> 0:13:01.280 barrel co mix well that a third of percent, or 0:13:01.320 --> 0:13:04.720 six dollars at sixteen fifty eight thirty announced euro point 0:13:04.960 --> 0:13:07.240 eight four three against the dollar. British found one point 0:13:07.280 --> 0:13:09.600 one eight eight to the end one nine point oh 0:13:09.720 --> 0:13:12.520 six and Intel's mobilize says it sees its ip ot 0:13:12.559 --> 0:13:15.240 the price between eighteen and twenty dollars per share, according 0:13:15.280 --> 0:13:17.920 to a filing. That's a Bloomberg business flash. Now here's 0:13:17.960 --> 0:13:20.320 Michael Barr with more on what's going on around the world. 0:13:20.440 --> 0:13:23.880 Michael Karen, thank you very much. Ukrainian President Zelenski says 0:13:23.920 --> 0:13:26.520 his country needs more help to defend itself from the 0:13:26.600 --> 0:13:30.480 Iranian maid so called Kama Kanze drones the Russian army 0:13:30.520 --> 0:13:33.679 has been using to attack civilian infrastructure. At least eight 0:13:33.720 --> 0:13:37.600 people were killed during yesterday's strikes. A suspected serial killer 0:13:37.640 --> 0:13:41.559 in Stockton, California, scheduled to be arraigned today. Authorities say 0:13:41.679 --> 0:13:45.280 forty three year old Wesley Brownlee is accused of terrorizing 0:13:45.360 --> 0:13:48.800 the community for months, hunting for his victims, and often 0:13:48.880 --> 0:13:52.400 waiting in the dark. In baseball, the Yankees and Guardians 0:13:52.400 --> 0:13:55.640 will play their deciding game five of their a LDS 0:13:55.720 --> 0:13:59.320 this afternoon at four pm Eastern time. Rain postponed last 0:13:59.440 --> 0:14:02.360 night's game. Wenday Night football, the Chargers beat the Broncos 0:14:02.400 --> 0:14:05.959 in overtime nineteen sixteen. In hockey, the Rangers, Bruins, and 0:14:06.200 --> 0:14:09.760 Capitals all one. Global News twenty four hours a day 0:14:09.920 --> 0:14:12.800 on here and on Bloomberg Quick Take, powered by more 0:14:12.840 --> 0:14:15.320 than twenty seven hundred journalists and analysts are more than 0:14:15.360 --> 0:14:18.480 a hundred twenty countries. Michael barn This is Bloomberg Nav 0:14:18.679 --> 0:14:21.360 all right, Michael. Thanks at six nineteen on Wall Street 0:14:21.440 --> 0:14:24.760 Life from the Bloomberg Interactive Broker Studios. This is Bloomberg 0:14:24.880 --> 0:14:27.720 Daybreak and we're joined now by Max Kentner, chief Multi 0:14:27.760 --> 0:14:32.440 Assets strategist at HSBC. Great to speak with you this morning, Max. 0:14:32.520 --> 0:14:36.880 As we watch futures continue to rise following yesterday's bounce 0:14:37.000 --> 0:14:39.280 on Wall Street, is there room for this rally to run? 0:14:39.320 --> 0:14:43.000 Are you fading this one? Yeah? Good morning, So I 0:14:43.160 --> 0:14:46.480 think I would be very very definitely fading this one. 0:14:46.480 --> 0:14:49.440 I think there's quite a quite a distinct lack of 0:14:49.600 --> 0:14:52.720 pass through really and then follow through if you if 0:14:52.760 --> 0:14:55.560 you look at the cross affit picture really because yeah, 0:14:55.680 --> 0:14:58.000 equities are all credits, breads are a bit a bit 0:14:58.120 --> 0:15:01.480 pint tighter. Fine, But actually what the market of what 0:15:01.600 --> 0:15:04.040 the equity market has played in particular yesterday and this 0:15:04.160 --> 0:15:06.600 morning is it is much rather the sort of return 0:15:06.680 --> 0:15:09.400 to goldilocks. I hope for a pit pivot again, but 0:15:10.240 --> 0:15:13.600 the difference to what we've seen perhaps in June, July, August, 0:15:13.840 --> 0:15:16.360 was that this was based on lower real yields, right, 0:15:16.360 --> 0:15:18.160 and it was sort of lifting old boats led to 0:15:18.320 --> 0:15:22.120 temporary reprieve leen led to you know that the led 0:15:22.200 --> 0:15:25.640 to gold spiking temporarily. All of that is missing right now, 0:15:26.160 --> 0:15:28.520 right again, is moving at all? Gold is sort of 0:15:29.120 --> 0:15:31.880 here or there. Right, It's it's fairly flat. Actually a 0:15:32.000 --> 0:15:34.320 real rate. If we look at long dated real rates 0:15:34.360 --> 0:15:37.400 in the US, again, they're pretty flat, right, They've been 0:15:37.480 --> 0:15:40.640 pretty flat in the last a couple of days. So 0:15:40.840 --> 0:15:43.440 it's really just the equity market playing a lot of 0:15:43.520 --> 0:15:45.680 hope paths around. You know, the news out of the 0:15:45.840 --> 0:15:49.080 UK yesterday, that's all. That's all got to temporary relief rallies. 0:15:49.400 --> 0:15:51.120 But in terms of if you have a three to 0:15:51.240 --> 0:15:54.640 six months view, I would be definitely fading this one now. 0:15:54.720 --> 0:15:57.600 Since you mentioned the news out of the UK and 0:15:57.840 --> 0:16:01.560 the I guess when you can't a pivot away from 0:16:01.640 --> 0:16:05.120 trust anomics, you see that as temporary. I mean, what 0:16:05.320 --> 0:16:08.440 what would it take for us to have a little 0:16:08.480 --> 0:16:13.440 bit more UH stability sensing coming out of the out 0:16:13.480 --> 0:16:17.200 of the UK situation? Yeah, I guess the the near 0:16:17.320 --> 0:16:20.000 term volatility is extremely high in the UK right, and 0:16:20.080 --> 0:16:22.160 then we we just don't really have a handle on 0:16:22.280 --> 0:16:26.120 all these political decisions, whether she's going to remain Prime 0:16:26.160 --> 0:16:28.800 minister or not, or you know, whether there's going to 0:16:28.840 --> 0:16:32.800 be a peace or members of the government resigning. What 0:16:33.000 --> 0:16:35.080 kind of pressure that will put on this This is 0:16:35.120 --> 0:16:39.920 all sort of the political speculation that will put volatility 0:16:40.600 --> 0:16:43.560 really really still high for the pounds and for guilt 0:16:43.680 --> 0:16:46.880 now finnally enough, Actually, UK equities, if you look at 0:16:46.920 --> 0:16:49.200 the large camps or the foots you one hundred, have 0:16:49.400 --> 0:16:52.320 been pretty okay during this period, and they've been pretty 0:16:52.360 --> 0:16:55.040 okay actually here to day, because of course we know 0:16:55.200 --> 0:16:57.640 there's value in the market, right, there's more of a 0:16:57.800 --> 0:17:01.040 whole new market, it's more of a defensive markets, and 0:17:01.240 --> 0:17:03.280 of course it benefits from that lower sterling. So so 0:17:03.360 --> 0:17:06.600 finally enough, actually, UT equities, the large caps from a 0:17:06.680 --> 0:17:10.320 global perspective look pretty okay. But until we can really 0:17:10.359 --> 0:17:14.600 sort of sound the all clear on guilds, on on pounds, sterling, 0:17:15.040 --> 0:17:17.920 I think we will need to not only see less 0:17:18.000 --> 0:17:20.000 noise on the political front, but we'd also need to 0:17:20.080 --> 0:17:23.440 see you know, more convincing news on the structural front, 0:17:23.480 --> 0:17:26.720 because let's Let's remember that among sort of detailed currencies, 0:17:27.440 --> 0:17:31.119 the pounder in the UK is probably facing the least 0:17:31.280 --> 0:17:35.119 favorable death dynamics this year and next year, and that is, 0:17:35.200 --> 0:17:37.440 you know, that's the much more important one from a 0:17:37.560 --> 0:17:40.040 let's say, at three to six months perspective, if you 0:17:40.080 --> 0:17:45.160 look at the pound disregarding really the political volatility. Turning 0:17:45.200 --> 0:17:47.800 back to the US market, we got the latest monthly 0:17:47.840 --> 0:17:51.159 fund manager survey from the Bank of America thinking that 0:17:51.480 --> 0:17:54.560 we might not see bottom here on Wall Street until 0:17:54.800 --> 0:17:57.879 sometime in the first half of next year, when the 0:17:58.000 --> 0:18:00.440 FED finally starts to pivot. When are you thinking the 0:18:00.520 --> 0:18:04.440 Fed pivots, if not from a higher interest rates to 0:18:04.640 --> 0:18:08.480 at least slowing down the increases. Yeah, But the funny 0:18:08.520 --> 0:18:10.560 thing is every everyone talks about a pivot. So far, 0:18:10.640 --> 0:18:14.080 everything we've seen was a pivot higher right, so far 0:18:14.560 --> 0:18:17.639 so far. The actual funny thing is that whenever we 0:18:17.760 --> 0:18:19.600 were talking about a pivot, it was like, well, maybe 0:18:19.640 --> 0:18:21.360 the FED funds is going to pick up three oh, 0:18:21.440 --> 0:18:22.880 and now it's three and a half. Now it's all 0:18:22.920 --> 0:18:25.560 and off. But the point for me is that the 0:18:25.680 --> 0:18:28.280 FED is really only going to pivot in my view, 0:18:28.680 --> 0:18:31.720 when things are going to go horribly wrong, not just wrong, 0:18:32.000 --> 0:18:35.320 but really and I have to emphasize that horribly wrong. Right, 0:18:35.680 --> 0:18:38.159 So it will not be sufficient if we see you 0:18:38.280 --> 0:18:41.720 one to three months of a bit worse than economic data, 0:18:41.800 --> 0:18:44.240 right and oh maybe we're going to go into refreshing now, 0:18:44.680 --> 0:18:47.560 that will not be sufficient, right. It will only really 0:18:47.680 --> 0:18:50.399 pivot and it will only really start to cut right 0:18:50.640 --> 0:18:55.400 if we see an aggressive downward drift in in activity data. 0:18:55.760 --> 0:18:58.120 And that of course is not good for risk asses either, 0:18:58.400 --> 0:19:00.680 which means to me, I think the bottom really only 0:19:00.800 --> 0:19:03.840 is in for for equities if it we're starting to 0:19:03.920 --> 0:19:07.440 see the correlation between equities and rates go negative again, 0:19:07.720 --> 0:19:11.400 i e. When people really start to become genuinely concerned 0:19:11.400 --> 0:19:14.600 about a recession. Just thirty seconds left here, what is 0:19:14.680 --> 0:19:18.159 your bottom? Where do you see the SMP going? So on? 0:19:18.359 --> 0:19:20.760 Our focus for end of this year three thousand, five hundred, 0:19:20.800 --> 0:19:22.800 but we have said we could reach at low as 0:19:23.040 --> 0:19:25.400 low as three thousand two hundred, because that would put 0:19:25.520 --> 0:19:28.359 us with a bit more valuation pressure. Still, it would 0:19:28.400 --> 0:19:31.720 mean that you know, we're probably gonna start to close 0:19:31.840 --> 0:19:35.240 this gap that exists between long dated real rates and 0:19:35.440 --> 0:19:38.640 valuations right now. So to us, there is as much 0:19:38.680 --> 0:19:42.200 scope pest to three thousand, two hundred. That the buying 0:19:42.400 --> 0:19:45.280 buying territory, and of course we did close higher yesterday 0:19:45.320 --> 0:19:48.440 at thirty six seventy seven. Thanks for this, Max, great 0:19:48.480 --> 0:19:51.000 having on with us this morning. Next Kettner, Chief Multi 0:19:51.040 --> 0:19:55.560 Assets Strategists at hs VC Futures this morning moving higher 0:19:55.600 --> 0:19:58.280 once again with SMP futures of fifty four point, Staff 0:19:58.280 --> 0:20:01.040 futures up faded at fifty five Nasty futures up a 0:20:01.160 --> 0:20:07.760 hundred ninety six points. This is Bloomberg Blomber eleven three 0:20:07.760 --> 0:20:10.760 oh Weather clearing cooler today with highs in the upper fifties, Sunny, 0:20:10.920 --> 0:20:16.000 mid fifties for tomorrow, sunshine upper fifties for Thursday. Right now, 0:20:16.040 --> 0:20:23.080 it's fifty degrees and cloudy in Central Park. Broadcasting live 0:20:23.280 --> 0:20:27.200 from the Bloomberg Interactive Broker Studio in New York. Bloomberg 0:20:27.240 --> 0:20:31.280 E Living free to Washington, d C, Bloomberg to Boston, 0:20:31.400 --> 0:20:35.240 Bloomberg one O six one to San Francisco, Bloomberg sixty 0:20:35.359 --> 0:20:38.000 to the country, Sirius XM to A one nine team, 0:20:38.119 --> 0:20:41.240 and around the globe the Bloomberg Business app and Bloomberg 0:20:41.359 --> 0:20:50.320 Radio dot Com. This is Bloomberg Daybreak and it's six 0:20:50.400 --> 0:20:52.639 thirty on Wall Street. Good morning. I'm Nathan Hagar and 0:20:52.760 --> 0:20:55.359 I'm Karen Moscow, and we are just about three hours 0:20:55.440 --> 0:20:57.879 away from the open of US trading. Let's get to 0:20:58.000 --> 0:20:59.959 the five things you need to know to start your day. 0:21:00.160 --> 0:21:04.280 Brought to you by Interactive Brokers. Interactive Brokers charges Martin 0:21:04.359 --> 0:21:06.400 loan rates from three point five eight percent to four 0:21:06.480 --> 0:21:09.159 point five eight percent rate subject to change. Learn more 0:21:09.240 --> 0:21:12.400 at i v k R dot com slash compare. First. 0:21:12.520 --> 0:21:15.680 US futures are rising after adding to yesterday's big rally. 0:21:15.840 --> 0:21:19.320 Still expect more of volatility ahead. That's according to Samir 0:21:19.440 --> 0:21:23.840 samana with Fols Fargo. What I'd really like to see 0:21:23.960 --> 0:21:25.960 is for this market to try and find kind of 0:21:26.000 --> 0:21:28.640 a bottom and from that standpoint just maybe even trade 0:21:28.720 --> 0:21:31.800 sideways for a few days. I think these constituted three 0:21:31.840 --> 0:21:34.040 percent up and down days, I think it continue to 0:21:34.080 --> 0:21:36.600 spook investors. I think maybe the best course of action 0:21:36.640 --> 0:21:38.880 for for markets from here, given what the FEDS trying 0:21:38.920 --> 0:21:40.760 to engineers, just to go sideways for a few days. 0:21:40.960 --> 0:21:43.840 Well S Fargo Samir Samanas says daily swings of two 0:21:43.880 --> 0:21:47.239 to three percent indicate fergility in the market. Overseas can 0:21:47.280 --> 0:21:49.920 In the UK, government's trying to continue calming markets after 0:21:50.000 --> 0:21:51.920