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Speaker 1: This is Bloomberg Daybreak Asia for this Friday, January seven

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Speaker 1: in Hong Kong, Thursday January six in New York and

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Speaker 1: coming up this hour. US GDP growth slows mildly as

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Speaker 1: the markets look ahead to the feds next policy decision.

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Speaker 1: Intel gives a dire forecast for the current quarter, with

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Speaker 1: sinking demand for PCs and China malls, an export band

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Speaker 1: that could help the nation maintain its dominance in solar tech.

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Speaker 1: The fight over the death ceiling is intensifying. The US

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Speaker 1: moves to protect Hong Kong citizens from being forced to

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Speaker 1: go back and callstaband TikTok in the US are intensifying.

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Speaker 1: I'm too these Pelegrity with Global News. The women's final

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Speaker 1: is set at the Australian Open. On Dan Schwartzmen, I'll

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Speaker 1: have that story more coming up in Bloomberg Sports. That's

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Speaker 1: all straight ahead on Bloomberg Daybreak Asia on Bloomberg eleven

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Speaker 1: three on New York, Bloomberg Washington, d C, Bloomberg one

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Speaker 1: six one, Boston, Bloomberg nine sixties, San Francisco, Sirius x

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Speaker 1: M one nineteen and around the world on Bloomberg Radio

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Speaker 1: dot Com and via the Bloomberg Business app. Good morning,

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Speaker 1: I'm do Prisoner and I'm Brian Curtis. Here are the

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Speaker 1: stories we're following today. Let's take a closer look here

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Speaker 1: at the slowdown in the US economy. The US economy

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Speaker 1: beating expectations in the last quarter of two and he

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Speaker 1: posted the kind of mild slowdown that the FED actually

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Speaker 1: wants to see as it attempts to tame inflation. However,

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Speaker 1: economists see some risks ahead in three. As Doug alluded to,

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Speaker 1: Lindsay A Piegs is one, She's chief economist is stephile

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Speaker 1: we are teetering towards a recession. And now, of course

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Speaker 1: the fourth quarter number does look pretty good, particularly against

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Speaker 1: the backdrop of an even stronger rise in the third quarter,

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Speaker 1: But when we look at what's happening with the consumer,

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Speaker 1: which is the backbone of the US economy, we are

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Speaker 1: seeing a clear loss of momentum. Now, all eyes are

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Speaker 1: on a key FED decision that's coming up on February one.

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Speaker 1: The FED is expected by traders to high rates by

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Speaker 1: another twenty five basis points that officials are signaling that

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Speaker 1: rates will stay high through the rest of the year

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Speaker 1: until until inflation is beaten. We're still in the flow

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Speaker 1: of quarterly earnings. They are thick and heavy, and today

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Speaker 1: after the bell it was Intel delivering a dire forecast

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Speaker 1: for the current quarter. We have more from Bloomberg's Charlie Pellet.

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Speaker 1: Intel was hurt by sinking demand from PC customers and

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Speaker 1: tough competition in the lucrative market for server hardware. The

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Speaker 1: chip maker said first quarter sales will be ten and

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Speaker 1: a half to eleven and a half billion dollars. That

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Speaker 1: compares with an average Hannleist estimate of fourteen billion dollars.

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Speaker 1: The outlook reflects the myriad challenges facing Intel, which was

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Speaker 1: attempting to stage a comeback even before the market for

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Speaker 1: PC chips, it's main source of revenue, fell into a slump.

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Speaker 1: In New York. Arlie Pellett Bloomberg Daybreak Asia, Charlie, thanks

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Speaker 1: very much. An Intel down nine point seven percent again

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Speaker 1: in after hours, Well, we're hearing that China is considering

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Speaker 1: an export ban that would help the nation maintain its

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Speaker 1: substantial dominance in solar manufacturing. The ban is being considered

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Speaker 1: for technology used to make solar wafers. Wafers are ultra

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Speaker 1: thin silicon squares that are pieced together into solar panels,

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Speaker 1: and China accounts for nine percent of global output. We're

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Speaker 1: told to move is still in the public consultation phase

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Speaker 1: now and no decisions have yet been made. Well, companies

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Speaker 1: linked to the Indian billionaire Guatamadanni will fight back against

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Speaker 1: being called bogus. We're told these companies are ready with

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Speaker 1: a detailed response to accusations from a US based short seller,

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Speaker 1: that being Hindenburg Research. That firm says that the companies

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Speaker 1: owned by and Donni engage in brazen market manipulation and

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Speaker 1: accounting fraud. The Addonni Group says the assertions are devoid

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Speaker 1: of facts. Here's Bloomberg's PR Sungai. Yesterday, Adani Group CEO

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Speaker 1: himself came on the television. He had sent out a

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Speaker 1: statement and he had come on a video and circulated

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Speaker 1: the video widely to say that this is all off,

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Speaker 1: you know, malicious and malified, integens, et cetera. Adani Group

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Speaker 1: legal had also said the same thing and they are

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Speaker 1: also setting up various calls with investors to Alena Fias

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Speaker 1: that is Bloomberg's p R Sunji. By the way, we

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Speaker 1: are told the Adani Group will reply to some of

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Speaker 1: the issues from Hindenberg's report in an eighteen page presentation

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Speaker 1: titled Myths of short Seller. Donnie will publish a more

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Speaker 1: detailed reply on Hindenberg's one page do cier that will

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Speaker 1: happen tomorrow. Brian Toyota will elevate the head of Lexus

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Speaker 1: to replace longtime CEO Akio Toyota. Kochi Sato is Toyota's

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Speaker 1: chief branding officer and the head of its luxury car division,

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Speaker 1: and we'll take over that role on April one. Toyota,

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Speaker 1: who has held the since two thousand and nine, will

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Speaker 1: now become chairman. Toyota has been the best selling automaker

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Speaker 1: for much of Toyota's tenure. However, in Tesla overtook the

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Speaker 1: company and market value with its lead in fully electrical vehicles.

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Speaker 1: Bloomberg's Craig Trudel says the new CEO will be tasked

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Speaker 1: with navigating the company shift to clean energy. It is

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Speaker 1: going to be a challenge for the new CEO to

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Speaker 1: sort of take the company from hybrids and plug in

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Speaker 1: hybrids to we really need to take fully electric vehicles seriously.

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Speaker 1: Established more of a presence, and Toyota is spending thirty

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Speaker 1: one billion dollars to roll out its thirty EV models.

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Speaker 1: By so walked us through a lot of what we

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Speaker 1: saw in the GDP report that is both good and

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Speaker 1: also suggests a few issues down the road. But all

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Speaker 1: in all, the FED would probably be happy with this report.

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Speaker 1: I think you're right about that. The one thing that

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Speaker 1: I think that would concern the FED is that if

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Speaker 1: risk appetite gets to be a little too much, financial

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Speaker 1: conditions begin to loosen just a bit. I think we

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Speaker 1: are still at a very fragile point in the FEDS thinking,

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Speaker 1: obviously we've got the rate decision, uh next week. You know.

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Speaker 1: In terms of the earning story, we were talking a

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Speaker 1: lot about the quarterly results that we've been hearing in

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Speaker 1: guidance for the current quarter and beyond, Bloomberg Intelligence saying

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Speaker 1: that analyst estimates for profits this year will continue to fall,

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Speaker 1: major regions showing negative revision momentum. So that doesn't bode

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Speaker 1: well when you consider the earning story. It's a big

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Speaker 1: question though, to to ask ourselves, can we see massive

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Speaker 1: job losses and layoffs coming? It doesn't feel like, at

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Speaker 1: least at this moment. I wanted to mention the visa

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Speaker 1: and MasterCard reports seeing cards spending slow. It's interesting because

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Speaker 1: originally spending stage strong because of the big transfer payments

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Speaker 1: from government. Then consumers had seemed to spend most of

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Speaker 1: it and started maxing out their credit cards. Now we

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Speaker 1: hear from Visa and MasterCard that it's actually slowing now

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Speaker 1: that kind of spending. So what comes next, recession or

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Speaker 1: soft landing? Well, look at hasbro preliminary adjusted EPs below

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Speaker 1: estimates and check this out. The company is going to

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Speaker 1: cut about fifteen percent of its global workforce this year.

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Speaker 1: I would tie that to your uh, your line of

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Speaker 1: thinking here on the strength of the consumer. Yep, absolutely

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Speaker 1: becomes very very interesting going forward. Okay, it's time for

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Speaker 1: global news. The US moves to protect people from Hong

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Speaker 1: Kong from being sent back, and President Biden slams Republicans

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Speaker 1: in his first major economic speech for three for more,

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Speaker 1: we get to the Bloomberg newsroom and Denise Pellegrini Denise, yeah,

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Speaker 1: thank you, Brian And President Biden, Well, he is accusing

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Speaker 1: Republicans of exploiting the death ceiling, and he says he

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Speaker 1: doesn't understand the GOP's in fighting. What in God's name

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Speaker 1: with the Americans give up the progress we've made for

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Speaker 1: the chaos. They're just I don't get it, all right,

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Speaker 1: And that's Biden talking to union workers in Virginia. If

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Speaker 1: Democrats and Republicans don't come to an agreement over the

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Speaker 1: dead ceiling, the U S could default. And Republican Senator

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Speaker 1: Tom Tillis of North Carolina wants spending cuts and he

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Speaker 1: says Biden's current stance is just not productive. There's no

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Speaker 1: question that there are opportunities to cut the current right

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Speaker 1: of growth and spending in Washington. And it's on us,

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Speaker 1: as Republicans controlling one of the chambers and Congress, to

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Speaker 1: put forth an offer and expect Boden to step off

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Speaker 1: of his I'm not negotiating stance and get to work

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Speaker 1: so that we can do good for the American people.

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Speaker 1: Until us there on Blueberg Balance Power, the Biden administration, meantime,

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Speaker 1: extending a program that protects Hong Kong's citizens here in

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Speaker 1: the US from being deported for another two years more

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Speaker 1: than that from Blueberg's Nathan Hager. The White House made

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Speaker 1: the move on the program, known as Deferred Inforced Departure

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Speaker 1: for certain Hong Kong citizens less than two weeks before

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Speaker 1: it was due to expire. This now means Hong Kong

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Speaker 1: residents would have been deported for overstaying their visas will

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Speaker 1: now be allowed to stay until January. In a statement,

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Speaker 1: the National Security Council says this demonstrates President Biden's strong

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Speaker 1: support for the people of Hong Kong in the face

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Speaker 1: of increasing repression by the Chinese government. All right, thank you, Nathan. Meantime,

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Speaker 1: Chinese company in the cross fire. As the US rams

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Speaker 1: up sanctions on Russia over Ukraine. The Treasury Department is

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Speaker 1: now slapping sanctions on Space City China and a European subsidiary,

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Speaker 1: accusing the company of giving satellite images of Ukraine to

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Speaker 1: the pro Kremlin mercenary Wagner Group. The I m F

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Speaker 1: is considering a massive aid package for Ukine as much

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Speaker 1: as sixteen billion dollars, US and Germany sending more tanks

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Speaker 1: to Ukraine, and Jane Harmon Freedom Health Board chairman and

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Speaker 1: former congresswoman from California telling us the US may be

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Speaker 1: sending even more after this if we are committed in certainly,

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Speaker 1: Lloyd Austin, who's a very impressive Secretary of Defense, says

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Speaker 1: we are to helping the Ukrainians win this war. We've

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Speaker 1: got to provide them with the and Russia launched a

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Speaker 1: new wave of attacks earlier today, build a band TikTok

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Speaker 1: gaining steam in Congress. FCC Commissioner Brendan car telling Bloomberg

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Speaker 1: Television the Biden administration could deal the final blow. I

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Speaker 1: think it should be the precedent for this. We've used

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Speaker 1: Scifius before to unwind the purchase of Grinder based on

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Speaker 1: having connections back to a Beijing based entity. India has

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Speaker 1: banned TikTok across their entire countries, so I think that's

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Speaker 1: the right direction to go here. And sciphius, of course,

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Speaker 1: the Committee on Foreign Investment in the United States, and

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Speaker 1: James Dolan is now threatening to ban alcohol at New

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Speaker 1: York Rangers hockey games. Dolan, of course, is the chairman

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Speaker 1: of Madison Square Garden Entertainment. His threat in response to

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Speaker 1: that state investigation into how he uses facial recognition at

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Speaker 1: his properties to keep political enemies and people. Maybe he

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Speaker 1: just doesn't like the claim is out. Global News twenty

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Speaker 1: four hours a day on airn and Blober Quicktake, powered

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Speaker 1: by more than journalists and analysts in more than a

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Speaker 1: hundred and twenty countries in the new So I'm Denise Pellegrini.

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Speaker 1: This is Bloomberg. This is Bloomberg Daybreak Asia. I'm Brian

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Speaker 1: Curtis in Hong Kong along with Rashad Salat in Singapore,

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Speaker 1: and our guest is Dana Doria, co ce Io and

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Speaker 1: group president at evest Net Solutions. Dana, the market action

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Speaker 1: seems to be clouding this question about when is labor

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Speaker 1: going to crack. The market might be sluffing that off,

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Speaker 1: but you know, is that coming? Should we be? Um,

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Speaker 1: well not yet. We certainly just had another initial jobless

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Speaker 1: claims falling this week, so yeah, I mean look, and

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Speaker 1: yet we do, of course have all these headlines of layoff,

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Speaker 1: particularly in the text actor, but really you know, getting

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Speaker 1: expansive headlines around layoffs, so you know these things it's

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Speaker 1: going to happen, right, It happens with a lag. It

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Speaker 1: usually isn't immediate. It takes some time, you know, from

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Speaker 1: the start of a tightening cycle to start seeing you know,

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Speaker 1: real numbers in terms of layoffs. But I've that we

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Speaker 1: get there. We know markets are leading indicators. Um, we're

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Speaker 1: all we're all anticipating that there's decent odds of recession.

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Speaker 1: If not um this year, then certainly in the next

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Speaker 1: couple of years. So um, yeah, I do think we're

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Speaker 1: going to see that. It's not happening now. And I

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Speaker 1: think a lot of the numbers that are coming in

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Speaker 1: now are you know, markets are kind of interpreting to me. Okay,

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Speaker 1: the FED is going to feel good about inflation speaking, Um,

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Speaker 1: there's there's too much in the way of concerns about

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Speaker 1: a recession. So in fact, we will get the pivot

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Speaker 1: um and it's still early to be kind of trending

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Speaker 1: that way. I think danea that I mean, we're talking about,

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Speaker 1: you know, a huge lag. This is unprecedented how long

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Speaker 1: it's taking for monetary policy to be is showing whether

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Speaker 1: or not it has any efficacy. And you know, on

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Speaker 1: top of that, you look at the GDP figures. I know,

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Speaker 1: as a Doug was saying early it's the backward looking indicator.

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Speaker 1: But certainly this if this medicine is not working, um,

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Speaker 1: well what happens next. I don't know that I think

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Speaker 1: it's not working. I do think that, you know, think

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Speaker 1: about how quickly those those rate hikes took place last year.

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Speaker 1: I mean just you know, very sudden and abrupt um,

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Speaker 1: and we are seeing inflation peaking right, wage growth, yes,

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Speaker 1: that's that's remaining sticking, and I think that's where the

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Speaker 1: concerns still are. But we're seeing a lot of signs

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Speaker 1: that you know, we have peeked on inflation elsewhere, and

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Speaker 1: so you know, to a certain extent, afety go ahead. Well,

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Speaker 1: I mean, I think the obvious question is, doesn't this

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Speaker 1: mean that the FED stays higher for longer? We've got

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Speaker 1: a lot more pain ahead. Oh, I I don't think

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Speaker 1: there's a question about that. I mean, you know, the

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Speaker 1: thought that there's a pivot. I shouldn't say there isn't

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Speaker 1: a question. Um, that's too strong. But I would say that,

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Speaker 1: you know, hike and hold is probably more likely than

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Speaker 1: some sort of big pivot. Um. I think the Fed,

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Speaker 1: you know, the good news is at least it looks

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Speaker 1: pretty well priced in twenty basis points the next two meetings,

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Speaker 1: and you know, the market can kind of prepare, right,

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Speaker 1: you know, investors know what's coming. It seems that at

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Speaker 1: least the data gives the FED the opportunity to not

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Speaker 1: kind of have to react unpredictably. But but you know that,

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Speaker 1: so that's what the markets get. I don't think the

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Speaker 1: markets get a pivot at least until the second half

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Speaker 1: of the year. Well, Dana, how does this then all

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Speaker 1: play into your investment thesis? You know, I've said, Um,

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Speaker 1: I've always maintained kind of look over the globally diverse

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Speaker 1: by look overseas. I think we're seeing that, you know,

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Speaker 1: kind of more than ever at the moment. Right. So,

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Speaker 1: and if if you ever needed, you know, a good

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Speaker 1: example of why you shouldn't sort of predict and say, well,

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Speaker 1: you know, I mean, it wasn't long ago that everybody

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Speaker 1: set up Europe's in for a terrible recession. Um, you know,

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Speaker 1: the the gas policy, the war between Russian Ukraine is

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Speaker 1: going to cause tremendous strain on the European economy. And

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Speaker 1: now here we are and it looks like europe a

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Speaker 1: voice recession altogether. Why because you know the weather is mild, right,

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Speaker 1: So what does that tell you about kind of taking

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Speaker 1: your money out of half the global economy? Um, you know,

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Speaker 1: and stay in US only, uh, you know, based on

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Speaker 1: just these predictions. So, I do think valuations favor looking

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Speaker 1: overseas at this point. If you haven't been already and

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Speaker 1: we're seeing that, it would have paid off had you

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Speaker 1: been doing that. Yeah, and particularly in China, you don't

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Speaker 1: have higher interest rates, you have lower interest rates. But

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Speaker 1: I want to go back to the FED. If it's

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Speaker 1: hanging its hat on the job market cracking, that could

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Speaker 1: be very dangerous because it means that, you know, like

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Speaker 1: if you look at the Visa and MasterCard data, spending

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Speaker 1: is already slowing. That's actually what we want. We don't

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Speaker 1: want job losses. We want the spending to slow down,

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Speaker 1: the economy to slow down and not overheat. We don't

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Speaker 1: actually want job losses, but they seem to want it. Yeah,

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Speaker 1: it's but but that's such a very difficult needle to thread, right,

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Speaker 1: the idea that you know, um, you can sort of

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Speaker 1: take us to a soft landing that we're gonna tamp

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Speaker 1: down demand, but we're not going to hit jobs. I

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Speaker 1: think trying to engineer that puts the FED in danger

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Speaker 1: of a sort of a stop and goal policy that's

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Speaker 1: worked out much Burst Path. This is Bloomberg day Break Asia,

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