WEBVTT - Bracing for Nvidia's Q4 Earnings

0:00:02.520 --> 0:00:07.040
<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio news.

0:00:10.880 --> 0:00:14.280
<v Speaker 2>Welcome to the Bloomberg Daybreak Asia podcast. I'm Doug Chrisner.

0:00:14.840 --> 0:00:18.480
<v Speaker 2>Tomorrow after the Bell in Video will deliver its highly

0:00:18.520 --> 0:00:22.320
<v Speaker 2>anticipated fourth quarter results. This is the world's most valuable

0:00:22.360 --> 0:00:26.000
<v Speaker 2>company and without a doubt, it's been the biggest beneficiary

0:00:26.079 --> 0:00:28.120
<v Speaker 2>of that big surge that we have seen in spending

0:00:28.160 --> 0:00:32.400
<v Speaker 2>on artificial intelligence over the past two years. Still there

0:00:32.400 --> 0:00:36.280
<v Speaker 2>are questions about whether data center operators will ease their

0:00:36.320 --> 0:00:40.400
<v Speaker 2>expenditures on artificial intelligence. Joining me now for a closer

0:00:40.400 --> 0:00:44.960
<v Speaker 2>look as Daniel Newman. He is the CEO of Futurum Group. Daniel,

0:00:44.960 --> 0:00:47.960
<v Speaker 2>it's always a pleasure. Thank you for joining us. You

0:00:48.120 --> 0:00:51.720
<v Speaker 2>have called in Vidia's earnings kind of a national holiday

0:00:52.000 --> 0:00:54.480
<v Speaker 2>in its own way. Make that case for me.

0:00:55.160 --> 0:00:57.440
<v Speaker 3>Well, we've seen over the last eight quarters it's become

0:00:57.800 --> 0:01:01.440
<v Speaker 3>the pivotal moment in the market, and over the last

0:01:02.040 --> 0:01:06.280
<v Speaker 3>two or three quarters you basically see the entire reflection

0:01:06.480 --> 0:01:09.080
<v Speaker 3>of what's happened with the other mag six companies kind

0:01:09.080 --> 0:01:11.680
<v Speaker 3>of culminate with this last report that comes out of

0:01:11.680 --> 0:01:15.320
<v Speaker 3>in Vidia, and unlike a lot of the other big earnings, Doug,

0:01:16.360 --> 0:01:20.319
<v Speaker 3>you'll see media folks like US analysts talking about this,

0:01:20.480 --> 0:01:21.800
<v Speaker 3>not just for days leading.

0:01:21.640 --> 0:01:24.000
<v Speaker 4>Up, it's weeks.

0:01:23.520 --> 0:01:25.800
<v Speaker 3>Of talk about what is going to happen and is

0:01:25.840 --> 0:01:28.000
<v Speaker 3>in Vidia the bell weather of the future of AI

0:01:28.160 --> 0:01:28.760
<v Speaker 3>in trade?

0:01:29.520 --> 0:01:32.040
<v Speaker 2>So the stock was down today about two point eight percent.

0:01:32.600 --> 0:01:34.920
<v Speaker 2>Over the last five trading days, I think we're off

0:01:34.959 --> 0:01:38.200
<v Speaker 2>about nine percent, and today and Video broke below that

0:01:38.240 --> 0:01:41.399
<v Speaker 2>two hundred day moving average. I know you're not a technician,

0:01:42.120 --> 0:01:44.080
<v Speaker 2>but is that a troubling sign.

0:01:44.880 --> 0:01:49.600
<v Speaker 3>I think this is the most pessimistic view I've seen

0:01:49.720 --> 0:01:55.920
<v Speaker 3>from the broader equities markets. Communities insist in video, though

0:01:56.240 --> 0:01:59.280
<v Speaker 3>it is every tech company. If you were a fast

0:01:59.360 --> 0:02:03.120
<v Speaker 3>growth liar like a Palenteer, you didn't see nine percent pullback,

0:02:03.160 --> 0:02:07.840
<v Speaker 3>you saw thirty percent pullback. In Vidia has accelerated and

0:02:07.880 --> 0:02:10.760
<v Speaker 3>pulled back, And of course it's felt like almost every

0:02:10.880 --> 0:02:13.680
<v Speaker 3>Sunday there's some piece of news. It's out to take

0:02:13.720 --> 0:02:16.400
<v Speaker 3>down the markets, it's taken down crypto, it's deep seek,

0:02:16.720 --> 0:02:18.720
<v Speaker 3>and so all these things are happening right now, and

0:02:18.760 --> 0:02:21.600
<v Speaker 3>it's kind of left in Video just right around where

0:02:21.600 --> 0:02:24.120
<v Speaker 3>it was six months ago. It's kind of just bouncing around.

0:02:24.600 --> 0:02:25.359
<v Speaker 4>But I'm not worried.

0:02:25.639 --> 0:02:28.639
<v Speaker 3>I think the trades very much intact very early ray So.

0:02:28.639 --> 0:02:30.919
<v Speaker 2>You mentioned deep seek there. I'm curious to get your

0:02:31.000 --> 0:02:33.680
<v Speaker 2>take as to whether or not the development of that

0:02:33.919 --> 0:02:37.800
<v Speaker 2>R one chatbot really kind of forces the market to

0:02:37.840 --> 0:02:42.280
<v Speaker 2>recalibrate this notion of how much spend is necessary to

0:02:42.320 --> 0:02:46.520
<v Speaker 2>get some of the most advanced AI without committing a

0:02:46.560 --> 0:02:49.360
<v Speaker 2>great deal to you know, some of these advanced chips.

0:02:49.600 --> 0:02:51.800
<v Speaker 3>I think you think it did the opposite. I think

0:02:51.880 --> 0:02:56.320
<v Speaker 3>upon initial reflection of what we read and what we

0:02:56.400 --> 0:02:58.320
<v Speaker 3>saw come out of that team and out of China,

0:02:58.680 --> 0:03:01.640
<v Speaker 3>it did look that way. But what we've found is

0:03:01.639 --> 0:03:04.560
<v Speaker 3>that through all of these sort of we've found the cheaper,

0:03:04.919 --> 0:03:08.600
<v Speaker 3>dirtier way to do AI moments, it actually turns out

0:03:08.639 --> 0:03:11.280
<v Speaker 3>that we need more compute, and it's going to happen

0:03:11.360 --> 0:03:14.560
<v Speaker 3>for a couple of different reasons. We will certainly see

0:03:14.680 --> 0:03:18.960
<v Speaker 3>techniques put into place that will enable more efficient compute

0:03:19.000 --> 0:03:23.960
<v Speaker 3>out of existing llms, that will develop and create more utilization.

0:03:24.440 --> 0:03:28.720
<v Speaker 3>But in the end that additional utilization is going to

0:03:28.720 --> 0:03:32.160
<v Speaker 3>scale exponentially. And so you've heard Sati Nadell and others

0:03:32.160 --> 0:03:35.280
<v Speaker 3>talk about Jevan's paradox. But we are at you know,

0:03:35.400 --> 0:03:38.720
<v Speaker 3>we are aggressively building out the infrastructure of the future.

0:03:38.760 --> 0:03:40.520
<v Speaker 3>But in terms of consumption, and this is why a

0:03:40.560 --> 0:03:43.320
<v Speaker 3>lot of people call AI a bubble, we are very

0:03:43.320 --> 0:03:46.480
<v Speaker 3>early in consumption. You know, Microsoft spending eighty five billion

0:03:46.800 --> 0:03:49.960
<v Speaker 3>on infrastructure build out in data centers and they are

0:03:50.000 --> 0:03:53.560
<v Speaker 3>able to show around thirteen billion in revenue. That model

0:03:53.600 --> 0:03:56.840
<v Speaker 3>doesn't work over a long period of time. So when

0:03:56.880 --> 0:03:59.560
<v Speaker 3>does that turn a corner where that eighty five billion

0:03:59.600 --> 0:04:02.080
<v Speaker 3>is going to re turn more than eighty five billion

0:04:02.200 --> 0:04:04.200
<v Speaker 3>in a short period of time, like the period of

0:04:04.240 --> 0:04:06.320
<v Speaker 3>time in which this technology stays relevant.

0:04:06.400 --> 0:04:09.360
<v Speaker 2>So I'm glad you're mentioning Microsoft there, because on Monday

0:04:09.400 --> 0:04:13.120
<v Speaker 2>we had a report from TD Cowen indicating that Microsoft

0:04:13.200 --> 0:04:16.800
<v Speaker 2>has canceled some leases for US data center capacity. And

0:04:16.880 --> 0:04:19.479
<v Speaker 2>with this news a lot of concern over whether or

0:04:19.480 --> 0:04:23.920
<v Speaker 2>not this company is securing more AI compute in terms

0:04:23.960 --> 0:04:26.560
<v Speaker 2>of capacity than it needs in the long term. I mean,

0:04:26.640 --> 0:04:28.280
<v Speaker 2>that seems to be a real question.

0:04:29.920 --> 0:04:31.760
<v Speaker 3>Yeah, this is another one that I think got a

0:04:31.800 --> 0:04:35.799
<v Speaker 3>little overblown. And let me tell you why the channel

0:04:35.880 --> 0:04:38.719
<v Speaker 3>checks not wrong. There is some cancelations going on in

0:04:38.760 --> 0:04:43.240
<v Speaker 3>the market, but what was not appropriately calculated in that

0:04:43.320 --> 0:04:48.600
<v Speaker 3>report was Microsoft's overbuying. And so a number of analysts

0:04:48.680 --> 0:04:50.400
<v Speaker 3>out there, and I've read some of these reports that

0:04:50.480 --> 0:04:53.080
<v Speaker 3>looked at these channel checks actually determined that if Microsoft

0:04:53.200 --> 0:04:56.039
<v Speaker 3>had not pulled back a little bit on some of

0:04:56.080 --> 0:04:58.719
<v Speaker 3>its build out, it would have been well above the

0:04:58.720 --> 0:05:02.159
<v Speaker 3>capex commitments that analysts have. So the capax is very

0:05:02.240 --> 0:05:04.640
<v Speaker 3>much attach. And actually Microsoft came out and said that

0:05:05.080 --> 0:05:09.280
<v Speaker 3>now these are you know, decade plus long buildouts that

0:05:09.360 --> 0:05:12.360
<v Speaker 3>are taking place. And while I do expect some EBB

0:05:12.360 --> 0:05:14.160
<v Speaker 3>and flow, and I do expect at some point these

0:05:14.160 --> 0:05:17.680
<v Speaker 3>returns have to come from all of this infrastructure investment,

0:05:18.200 --> 0:05:19.640
<v Speaker 3>I think the trade still intact. And one of the

0:05:19.640 --> 0:05:22.440
<v Speaker 3>thing that's worth noting about Microsoft is there is a

0:05:22.480 --> 0:05:25.680
<v Speaker 3>little bit of this movement with Stargate and the role

0:05:25.760 --> 0:05:29.760
<v Speaker 3>of open Ai, and then of course Microsoft's relationship with

0:05:29.760 --> 0:05:32.160
<v Speaker 3>open ai is pivoting. As open ai is looking at

0:05:32.200 --> 0:05:34.680
<v Speaker 3>its own chips, it's looking at more of its own infrastructure.

0:05:35.120 --> 0:05:37.600
<v Speaker 3>And so these kind of projects that are going on

0:05:37.720 --> 0:05:41.400
<v Speaker 3>in tandem are also going to impact Microsoft's builds a

0:05:41.400 --> 0:05:44.640
<v Speaker 3>little bit because Microsoft was such a provider to open

0:05:44.680 --> 0:05:45.760
<v Speaker 3>ai in its early era.

0:05:46.200 --> 0:05:47.720
<v Speaker 2>I'd like to get your view on what we heard

0:05:47.800 --> 0:05:51.200
<v Speaker 2>yesterday in terms of Apple's commitment to invest over five

0:05:51.279 --> 0:05:55.880
<v Speaker 2>hundred billion for new AI projects, particularly in Texas. A

0:05:55.920 --> 0:05:59.520
<v Speaker 2>lot of this is focused on the construction of data

0:05:59.560 --> 0:06:02.280
<v Speaker 2>center tech technology. Is this a bet that you would

0:06:02.480 --> 0:06:05.000
<v Speaker 2>want to be behind? In terms of what Apple is

0:06:05.040 --> 0:06:06.200
<v Speaker 2>doing right now?

0:06:06.240 --> 0:06:08.440
<v Speaker 3>It's really in vogue to build in the US and

0:06:08.600 --> 0:06:11.919
<v Speaker 3>President Trump that's a big focus of his. Tim Cook

0:06:11.920 --> 0:06:15.640
<v Speaker 3>and Trump. President Trump have been meeting. Clearly they've made progress.

0:06:15.760 --> 0:06:17.920
<v Speaker 3>I think there's a lot to be excited about the investment.

0:06:18.120 --> 0:06:21.279
<v Speaker 3>I'm a Texan. I love seeing companies come and build

0:06:21.320 --> 0:06:23.960
<v Speaker 3>in Texas. Having said that, I have a lot of

0:06:24.040 --> 0:06:27.280
<v Speaker 3>questions about Apple, It's AI strategy, its ability to execute.

0:06:27.400 --> 0:06:29.960
<v Speaker 3>It has made commitments in the past to build large

0:06:30.200 --> 0:06:35.560
<v Speaker 3>factories and production facilities in Wisconsin and other places that

0:06:35.640 --> 0:06:39.400
<v Speaker 3>haven't quite come to fruition. It's great when they announce,

0:06:39.520 --> 0:06:42.680
<v Speaker 3>it's better when they build, and it's even better when

0:06:42.720 --> 0:06:46.760
<v Speaker 3>they start to produce higher and create economic value through

0:06:46.800 --> 0:06:49.800
<v Speaker 3>these commitments. But it's a positive in its sentiment.

0:06:50.480 --> 0:06:52.120
<v Speaker 2>We had news here in the US late in the

0:06:52.160 --> 0:06:56.680
<v Speaker 2>day Monday on the Trump administration sketching out tougher versions

0:06:56.720 --> 0:07:00.680
<v Speaker 2>of those export curbs for semiconductors to China. This was

0:07:00.720 --> 0:07:04.920
<v Speaker 2>something that was initiated by the Biden administration. It seems

0:07:05.000 --> 0:07:08.599
<v Speaker 2>like the Trump administration wants to get tougher when you

0:07:08.680 --> 0:07:12.120
<v Speaker 2>look at US China and this war that may exist

0:07:12.280 --> 0:07:15.679
<v Speaker 2>in terms of the development and the adoption of certain

0:07:15.720 --> 0:07:18.520
<v Speaker 2>AI platforms. Is this something that the US is going

0:07:18.560 --> 0:07:21.040
<v Speaker 2>to win hands down or is there a real risk

0:07:21.400 --> 0:07:23.480
<v Speaker 2>in terms of what China is doing that we have

0:07:23.560 --> 0:07:27.679
<v Speaker 2>to be from the Western perspective on GUARD I would.

0:07:27.600 --> 0:07:31.640
<v Speaker 3>Characterize any underestimation of China and it's resolved to lead

0:07:31.680 --> 0:07:35.960
<v Speaker 3>the world in anything it does, as a mistake. I

0:07:36.000 --> 0:07:41.000
<v Speaker 3>believe that China will push the boundaries, including obtaining GPUs

0:07:41.040 --> 0:07:43.840
<v Speaker 3>potentially through gray markets, and we know there's some question

0:07:43.920 --> 0:07:47.280
<v Speaker 3>around that with deep seek. Having said that, I think

0:07:47.320 --> 0:07:53.080
<v Speaker 3>the West has found a largely an agreement, whether that's

0:07:53.640 --> 0:07:56.800
<v Speaker 3>the Dutch with ASML, whether that's Japan and Korea, whether

0:07:56.840 --> 0:08:00.720
<v Speaker 3>that's Taiwan, the US to have limited access to the

0:08:00.800 --> 0:08:05.480
<v Speaker 3>most advanced semiconductors as well as the machinery and some

0:08:05.560 --> 0:08:09.320
<v Speaker 3>of the materials required to build them. I mean, economic

0:08:09.400 --> 0:08:12.640
<v Speaker 3>prosperity for the next multiple decades is going to be

0:08:12.680 --> 0:08:14.840
<v Speaker 3>based on the parts of the world that are leading

0:08:14.880 --> 0:08:16.960
<v Speaker 3>in AI, and that's not to say other parts of

0:08:17.000 --> 0:08:20.120
<v Speaker 3>the world can't succeed. But I genuinely believe that President

0:08:20.120 --> 0:08:25.320
<v Speaker 3>Trump understands that winning an AI is critical to his presidency.

0:08:25.360 --> 0:08:28.800
<v Speaker 3>It's critical to the national security of the United States

0:08:28.840 --> 0:08:31.200
<v Speaker 3>and the West, and I do think that him and

0:08:31.240 --> 0:08:33.600
<v Speaker 3>his team are going to be steadfast to make sure

0:08:33.840 --> 0:08:36.680
<v Speaker 3>that the US does not lose its AI advantage under

0:08:36.679 --> 0:08:37.160
<v Speaker 3>his watch.

0:08:37.679 --> 0:08:41.200
<v Speaker 2>So we were talking about the AI startup and Thropic

0:08:41.320 --> 0:08:44.439
<v Speaker 2>finalizing of funding round worth about three and a half billion,

0:08:44.800 --> 0:08:47.440
<v Speaker 2>and we were told when we discover that news that

0:08:47.520 --> 0:08:50.199
<v Speaker 2>it would give Anthropic, this is the company behind the

0:08:50.280 --> 0:08:54.280
<v Speaker 2>chatbot claude evaluation of around sixty one and a half billion.

0:08:54.600 --> 0:08:57.400
<v Speaker 2>Does that seem about right to you? Are these numbers

0:08:57.440 --> 0:08:58.520
<v Speaker 2>a little inflated?

0:08:58.520 --> 0:08:59.800
<v Speaker 4>Do you think so?

0:09:00.480 --> 0:09:02.680
<v Speaker 3>It's hard to believe when you do the comps of

0:09:02.720 --> 0:09:06.520
<v Speaker 3>the well established companies that do not have sixty billion.

0:09:06.640 --> 0:09:09.079
<v Speaker 3>I mean, you know that Intel's floating around one hundred

0:09:09.160 --> 0:09:11.520
<v Speaker 3>and guess it has its problems, but it has a

0:09:11.559 --> 0:09:15.520
<v Speaker 3>fifty plus billion dollar products business and fabs all over

0:09:15.559 --> 0:09:19.319
<v Speaker 3>the world. And this company's like open AI and Anthropic

0:09:19.679 --> 0:09:22.679
<v Speaker 3>do it, you know, sub five billion dollars of revenue

0:09:22.679 --> 0:09:27.040
<v Speaker 3>and they lose money, so it is difficult at times

0:09:27.480 --> 0:09:31.120
<v Speaker 3>to understand. But I think any of us yourself myself included,

0:09:31.320 --> 0:09:33.960
<v Speaker 3>who've been around long enough, No, there's a difference between

0:09:34.320 --> 0:09:37.480
<v Speaker 3>kind of disruptive secular trendsetters and how those companies are

0:09:37.520 --> 0:09:43.800
<v Speaker 3>valuated and sort of long established enterprises. But having said

0:09:43.840 --> 0:09:47.160
<v Speaker 3>all that, I think the llms are rapidly being commoditized.

0:09:47.240 --> 0:09:48.040
<v Speaker 4>I think open.

0:09:47.840 --> 0:09:51.199
<v Speaker 3>Ai has real threats in some of the big incumbents,

0:09:51.600 --> 0:09:55.360
<v Speaker 3>including Google and open source like a meta And I

0:09:55.400 --> 0:09:58.960
<v Speaker 3>do think these valuations are quite frothy and without a

0:09:59.160 --> 0:10:03.839
<v Speaker 3>large IPO for a real uh you know, uh current

0:10:04.200 --> 0:10:06.360
<v Speaker 3>to take it to take it out to these valuations

0:10:06.400 --> 0:10:09.080
<v Speaker 3>in terms of revenue and profitability, I do think it's

0:10:09.160 --> 0:10:11.440
<v Speaker 3>risky for investors that are coming in these late rounds.

0:10:11.800 --> 0:10:13.760
<v Speaker 2>Dan, we'll leave it there. Thank you so much for

0:10:13.840 --> 0:10:16.479
<v Speaker 2>joining us and helping us look ahead to the earnings

0:10:16.840 --> 0:10:19.920
<v Speaker 2>Wednesday after the bell from Nvidia. Daniel Newman is the

0:10:19.920 --> 0:10:23.200
<v Speaker 2>CEO of Futureum Group, joining us here on the Daybreak

0:10:23.200 --> 0:10:34.080
<v Speaker 2>Asia podcast. Welcome back to the Daybreak Asia Podcast. I'm

0:10:34.120 --> 0:10:37.360
<v Speaker 2>Deek Chrisner. Stocks and Asia are moving lower. This is

0:10:37.400 --> 0:10:41.160
<v Speaker 2>after a disappointing print on us consumer confidence, and this

0:10:41.240 --> 0:10:43.960
<v Speaker 2>in turn is fueling concern about the health of the

0:10:44.000 --> 0:10:47.800
<v Speaker 2>American economy, the world's largest. We heard from Daniel Lamb,

0:10:47.800 --> 0:10:51.240
<v Speaker 2>he is head of equity strategy at Standard Chartered Wealth Solutions.

0:10:51.600 --> 0:10:55.440
<v Speaker 2>He spoke earlier with Bloomberg scherry On and Heidi Stroud Watts.

0:10:55.760 --> 0:10:58.400
<v Speaker 1>We're seeing in Nvidia sort of at the cheapest levels

0:10:58.480 --> 0:11:01.679
<v Speaker 1>going into earnings in about a year. Given the importance

0:11:01.760 --> 0:11:05.160
<v Speaker 1>of this software the broader market, could it really salvage

0:11:05.679 --> 0:11:08.840
<v Speaker 1>this equity rally that we've seen in the US, especially

0:11:08.880 --> 0:11:12.800
<v Speaker 1>after the Magnificent seven fell into correction territory Now.

0:11:13.559 --> 0:11:17.239
<v Speaker 5>Well, there are new factors at play nowadays in the markets.

0:11:17.640 --> 0:11:22.000
<v Speaker 5>So the DEEPSEK is a big factor. If you look

0:11:22.000 --> 0:11:27.280
<v Speaker 5>at the gap between Chinese equities and the mascor country

0:11:27.280 --> 0:11:31.680
<v Speaker 5>world equities, the Chinese equities are still trained at forty

0:11:31.679 --> 0:11:34.640
<v Speaker 5>five per cent discount, which is more than month standard

0:11:34.679 --> 0:11:40.640
<v Speaker 5>deviation away from the ten year average. So basically what

0:11:40.679 --> 0:11:45.120
<v Speaker 5>we're seeing is that there has been rotation of funds

0:11:45.160 --> 0:11:47.040
<v Speaker 5>from US equities.

0:11:46.480 --> 0:11:47.560
<v Speaker 4>Into Chinese ones.

0:11:47.760 --> 0:11:51.840
<v Speaker 5>So that's what's been happening in terms of the variation

0:11:51.960 --> 0:11:56.640
<v Speaker 5>that highlighted, and also the possibilities that China tech had

0:11:56.679 --> 0:12:00.600
<v Speaker 5>to offer. So before people were seeing that the US

0:12:00.679 --> 0:12:01.920
<v Speaker 5>tech is the only game in town.

0:12:02.040 --> 0:12:03.640
<v Speaker 4>Now things are a little bit different.

0:12:04.080 --> 0:12:07.480
<v Speaker 1>This is what the broader markets think. But Daniel, when

0:12:07.520 --> 0:12:10.400
<v Speaker 1>I look at your notes, you're actually pretty neutral on

0:12:10.480 --> 0:12:12.880
<v Speaker 1>Chinese equities and you still prefer the US.

0:12:13.240 --> 0:12:13.480
<v Speaker 4>Why.

0:12:13.960 --> 0:12:17.360
<v Speaker 5>Okay, So there are few things so Chinese equities overall

0:12:17.360 --> 0:12:21.520
<v Speaker 5>we're neutral, but within Chinese equities we are favorable on

0:12:21.640 --> 0:12:27.600
<v Speaker 5>the technology stocks. So it is a story of high

0:12:27.800 --> 0:12:33.679
<v Speaker 5>end versus lower end. So previously US technology the only

0:12:34.640 --> 0:12:39.120
<v Speaker 5>game in towne but now things need to be differentiated

0:12:39.760 --> 0:12:43.600
<v Speaker 5>because the Chinese deep seek shows that they're capable of

0:12:43.840 --> 0:12:48.840
<v Speaker 5>entering that tech space applied at the lower end level,

0:12:49.920 --> 0:12:54.360
<v Speaker 5>and basically people have to take account of that. In

0:12:54.440 --> 0:12:56.920
<v Speaker 5>the longer term, what we see is that the US

0:12:57.200 --> 0:12:59.880
<v Speaker 5>is still going to be dominating in the high end.

0:12:59.840 --> 0:13:02.160
<v Speaker 4>Of the tech space, right They're gonna take.

0:13:02.040 --> 0:13:05.240
<v Speaker 5>That and keep that. But then the Chinese, you know,

0:13:05.240 --> 0:13:08.080
<v Speaker 5>they do have a share of that. Okay, So right now,

0:13:08.120 --> 0:13:11.599
<v Speaker 5>because of the expensive valuation in the US tech, you

0:13:11.920 --> 0:13:14.120
<v Speaker 5>probably will see a little bit more rotation to come

0:13:14.559 --> 0:13:16.720
<v Speaker 5>in the near term, but in the long term we're favorable.

0:13:16.880 --> 0:13:18.560
<v Speaker 6>I wanted to ask a bit more about what you

0:13:18.600 --> 0:13:22.040
<v Speaker 6>say is sort of opportunistic moments in China, right, what

0:13:22.080 --> 0:13:23.720
<v Speaker 6>are you looking for the part at this point?

0:13:24.840 --> 0:13:27.680
<v Speaker 5>Well, at this moment in time, we've seen a big

0:13:27.760 --> 0:13:31.040
<v Speaker 5>rally in the Handsing index right from just below nineteen

0:13:31.080 --> 0:13:36.360
<v Speaker 5>thousand to above twenty three thousands, So that's pretty fast

0:13:36.400 --> 0:13:39.720
<v Speaker 5>and furious. So in the near term there could be

0:13:39.800 --> 0:13:43.080
<v Speaker 5>some correction, especially with the chip restriction news coming to

0:13:43.120 --> 0:13:43.559
<v Speaker 5>the US.

0:13:43.640 --> 0:13:45.920
<v Speaker 4>But then our point is.

0:13:45.800 --> 0:13:49.600
<v Speaker 5>That if you know they can make something like deep Seak,

0:13:50.120 --> 0:13:54.160
<v Speaker 5>then the box been opened, right. There are the possibilities

0:13:54.200 --> 0:13:59.880
<v Speaker 5>available for different Chinese technology sectors, So that's what will

0:13:59.920 --> 0:14:02.680
<v Speaker 5>be keeping the market going about China tech. Probably there

0:14:02.679 --> 0:14:05.559
<v Speaker 5>will be you know, some correction, but then hangs in

0:14:05.720 --> 0:14:08.280
<v Speaker 5>to about twenty one thousand and six to twenty two

0:14:08.280 --> 0:14:12.800
<v Speaker 5>thousand is good level of entry for the longer term investors.

0:14:13.440 --> 0:14:16.200
<v Speaker 6>For a longer term investor, taking a look at Indian

0:14:16.200 --> 0:14:18.079
<v Speaker 6>stocks and fifty to fifty is trading near the lowest

0:14:18.160 --> 0:14:22.240
<v Speaker 6>level since about June house the sort of sentiment there,

0:14:22.400 --> 0:14:24.520
<v Speaker 6>do you think that now kind of presents a good

0:14:25.920 --> 0:14:27.000
<v Speaker 6>value point to re.

0:14:27.160 --> 0:14:31.880
<v Speaker 5>Enter well in terms of variations back to five year

0:14:31.920 --> 0:14:35.040
<v Speaker 5>average for Indian equities right now.

0:14:35.280 --> 0:14:39.160
<v Speaker 4>I believe that the long term opportunities still exist. The

0:14:39.200 --> 0:14:41.240
<v Speaker 4>government's budget has.

0:14:41.160 --> 0:14:45.000
<v Speaker 5>Been stimulatory in various areas, so that's encouraging.

0:14:46.080 --> 0:14:49.160
<v Speaker 4>The earnings is still reasonable. But then at this moment

0:14:49.160 --> 0:14:49.920
<v Speaker 4>in time, I think.

0:14:49.800 --> 0:14:53.360
<v Speaker 5>People are just more focused on the China story right

0:14:53.400 --> 0:14:56.120
<v Speaker 5>now because it's been very quiet for a long long

0:14:56.160 --> 0:14:59.280
<v Speaker 5>time in China, so people are focusing on that. But

0:14:59.360 --> 0:15:01.720
<v Speaker 5>Indian equality, we do believe that on the twelve on

0:15:01.760 --> 0:15:03.360
<v Speaker 5>horizon there's upside from here.

0:15:04.160 --> 0:15:06.080
<v Speaker 1>On the other hand, it's been pretty noisy when it

0:15:06.080 --> 0:15:09.080
<v Speaker 1>comes to Japanese equity markets, just because of the interest

0:15:09.160 --> 0:15:12.760
<v Speaker 1>that we've seen from global investors. What will a stronger

0:15:12.840 --> 0:15:15.640
<v Speaker 1>Japanese yen mean for the equity markets here and that

0:15:15.800 --> 0:15:18.120
<v Speaker 1>rally that we saw last year, can it continue into

0:15:18.120 --> 0:15:19.000
<v Speaker 1>twenty twenty five.

0:15:20.040 --> 0:15:21.480
<v Speaker 4>I think Japanese.

0:15:21.080 --> 0:15:24.560
<v Speaker 5>Equities you've got to be more differentiative, right, So we

0:15:24.640 --> 0:15:29.800
<v Speaker 5>have a neutral overall, but in terms of the sectors,

0:15:30.520 --> 0:15:34.360
<v Speaker 5>areas that we like will be the financials because we

0:15:34.400 --> 0:15:36.440
<v Speaker 5>do see that the Bank of Japan is going to

0:15:36.440 --> 0:15:40.840
<v Speaker 5>be pretty much the only central bank that will be

0:15:40.920 --> 0:15:48.440
<v Speaker 5>tightening this year and stronger and STPU curve is favorable for.

0:15:48.520 --> 0:15:52.960
<v Speaker 1>The financials Daniel Lam, head of Equity Strategy Stander Chartered

0:15:53.040 --> 0:15:54.200
<v Speaker 1>Whilst Solutions.

0:15:54.240 --> 0:15:59.560
<v Speaker 2>There Thanks for listening to today's episode of the Bloomberg

0:15:59.640 --> 0:16:03.280
<v Speaker 2>day Break Asia Edition podcast. Each weekday, we look at

0:16:03.280 --> 0:16:07.760
<v Speaker 2>the story shaping markets, finance, and geopolitics in the Asia Pacific.

0:16:08.000 --> 0:16:11.320
<v Speaker 2>You can find us on Apple, Spotify, the Bloomberg Podcast

0:16:11.360 --> 0:16:14.720
<v Speaker 2>YouTube channel, or anywhere else you listen. Join us again

0:16:14.760 --> 0:16:18.080
<v Speaker 2>tomorrow for insight on the market moves from Hong Kong

0:16:18.200 --> 0:16:22.600
<v Speaker 2>to Singapore and Australia. I'm Doug Prisoner and this is

0:16:22.640 --> 0:16:23.160
<v Speaker 2>Bloomberg