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Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.

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Speaker 2: This is Bloomberg day Break Weekend, our global look at

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Speaker 2: the top stories in the coming week from our day

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Speaker 2: Break anchors all around the world. Straight Ahead on the program,

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Speaker 2: a look at key inflation data in the US and

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Speaker 2: what it means for the FED. I'm Tom Busby in

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Speaker 2: New York. I'm Stephen Carolyn London.

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Speaker 3: Where we're looking at how European efforts to attract foreign

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Speaker 4: I'm Brian Curtis in Hong Kong. We look ahead to

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Speaker 4: big tech earnings in China and whether they might provide

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Speaker 4: some momentum to recent games.

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Speaker 5: That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg

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Speaker 5: E Love the three Own New York, Bloomberg ninety nine

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Speaker 2: Good day to you. I'm Tom Busby, and we begin

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Speaker 2: today's program with some key US economic data out this week,

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Speaker 2: including CPI, PPI, and retail sales for April. What could

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Speaker 2: all this mean for Fed policy going forward? For more,

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Speaker 2: we're joined by Edward Harrison Bloomberg, Senior editor and writer

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Speaker 2: of the Everything Risk newsletter.

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Speaker 6: Well, Edward.

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Speaker 2: After a dip to three point one percent in January,

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Speaker 2: overall consumer prices in February and March little higher than forecast,

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Speaker 2: a troubling sign. What do you expect to see for April?

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Speaker 6: Yeah, Tom, great to talk to you.

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Speaker 7: I think what we expect on Tuesday, that's when the

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Speaker 7: CPI comes out.

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Speaker 6: The consensus is for three point six.

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Speaker 7: Percent for the core and three point four percent overall.

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Speaker 6: So core inflation has acted.

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Speaker 7: She's been running higher on average over the last year

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Speaker 7: than CPI when you include food and energy, and because

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Speaker 7: those prices have come down and that's dragging the total down.

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Speaker 7: But those numbers are really elevated relative to where the

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Speaker 7: Fed wants to go. Now, last month we had a

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Speaker 7: three point eight number for the core number. This month

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Speaker 7: we expect three point six. So three point eight terrible.

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Speaker 7: Three point six less terrible, but also not that great.

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Speaker 2: Well, moving in the right direction at least it's not

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Speaker 2: close to the to FED two percent target, but it

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Speaker 2: appears to be moving the right way.

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Speaker 7: That's exactly right. And I think that, you know, for

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Speaker 7: the FED, the real question is and I think J.

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Speaker 7: Powell got to this last week or the week before

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Speaker 7: last actually when the FED met, he was talking about,

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Speaker 7: we're not going to cut anytime soon. And so what

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Speaker 7: they're looking for are two preconditions. One is exactly what

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Speaker 7: you mentioned, Tom, which is that it's moving in the

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Speaker 7: right direction. So what we want to see is that

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Speaker 7: three point eight number come down. But we also want

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Speaker 7: to see that number be a lot lower. And so

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Speaker 7: that's the second precondition that we haven't met. If we

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Speaker 7: get to three percent, say, then I think you start thinking, wow,

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Speaker 7: maybe the FED has room to start cutting interest rates.

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Speaker 7: So three percent anything with a two handle, you know,

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Speaker 7: two point nine, two point eight, which we can't expect

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Speaker 7: next week, but potentially down the line we can expect that.

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Speaker 2: Well, let's talk about the factors for this stubbornly high inflation.

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Speaker 2: And I have to figure you tell me the rising

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Speaker 2: cost of housing, buying, renting, whatever it takes, is that

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Speaker 2: the biggest one.

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Speaker 6: Yeah, that is the sticky wicket. So to speak.

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Speaker 7: The real problem is, you know, this is something worldwide

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Speaker 7: that people are seeing, is that we're seeing a shortage

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Speaker 7: of housing. You could call this some that is a

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Speaker 7: outgrowth of the Great Financial Crisis, which was only which

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Speaker 7: was fifteen years ago. But the pain from that crisis

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Speaker 7: was so big for home builders that we had a

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Speaker 7: birth of building. And so now that the economy is back,

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Speaker 7: there simply isn't enough housing to absorb.

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Speaker 6: The demand for new housing. With this new.

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Speaker 7: Cohort, the millennials looking to now establish their own houses,

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Speaker 7: and so that means that both buying and renting houses

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Speaker 7: in the United States is going up and that is sticky.

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Speaker 7: That along with services inflation, are the two things that

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Speaker 7: are keeping the FED on hold for the foreseeable future.

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Speaker 2: But if we do see inflation moderating, and I don't

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Speaker 2: think that's going to happen anytime with housing, at the

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Speaker 2: same time, we're seeing signs that the US labor market

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Speaker 2: may be softening after April's jobs report. What does that

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Speaker 2: mean for the FED moving forward? If we do see that.

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Speaker 7: I think yeah, they're what they're looking for is the

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Speaker 7: so called soft landing. And when you can define the

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Speaker 7: soft landing as you know, a growth that is below

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Speaker 7: trend and their trend they would consider, you know, something

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Speaker 7: in the order of one point eight percent annualized. So

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Speaker 7: let's say you have one percent one and a half

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Speaker 7: percent growth and you also have inflation declining towards their target,

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Speaker 7: that would be considered a soft landing. And you know,

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Speaker 7: we saw the jobless claims last week. They were showing

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Speaker 7: us that we're moving in that direction. They were slightly elevated.

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Speaker 7: It wasn't a terrible number. It doesn't mean that the

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Speaker 7: economy isn't still making jobs, but it does give the

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Speaker 7: FED some thought that we're moving in the soft landing direction.

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Speaker 6: Well, let's hope.

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Speaker 2: Let's hope. Now, one other data point investors get this

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Speaker 2: Wednesday is retail sales for April. What do you expect

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Speaker 2: to see there? And you know, with inflation people pulling

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Speaker 2: back spending, what do you hope to see?

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Speaker 7: I would say that's the big wild card for this

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Speaker 7: week is the Wednesday number, because the prior numbers were

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Speaker 7: one percent a month on month increases. Even if you

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Speaker 7: take out autos, we had one point one percent. We

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Speaker 7: had one point one for the control group, which is

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Speaker 7: sort of the thing that people look at the most

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Speaker 7: and that's a very high number.

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Speaker 6: The expectation is it's.

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Speaker 7: For a mini increase zero point one percent, And if

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Speaker 7: we go above those numbers, it's hard to say how

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Speaker 7: the market will.

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Speaker 6: React based upon that.

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Speaker 7: It could be that because the number is zero point

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Speaker 7: two or zero point three, the market's fine, But those

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Speaker 7: numbers are above expectations, and so anything that shows that

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Speaker 7: the consumer is actually still hanging in there more than expected,

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Speaker 7: I think will be met with negativity by the market

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Speaker 7: because it would show that the Fed needs to.

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Speaker 6: Be on a hold for longer in order to bring

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Speaker 6: inflation down.

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Speaker 2: Well, well, we've got a lot to look forward to,

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Speaker 2: and our thanks to Edward Harrison. He's Bloomberg senior editor

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Speaker 2: and the writer of the Everything Risk newsletter. Well, we

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Speaker 2: turn now to corporate earnings, and this coming week we

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Speaker 2: hear from the home improvement retailer home Depot on Tuesday,

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Speaker 2: in the world's biggest retailer, Walmart on Thursday. So what

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Speaker 2: will the results tell us about the health of US consumers?

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Speaker 2: For more, we're joined by John Edwards, Bloomberg News US

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Speaker 2: Consumer team leader. John, Thanks for being here, great to

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Speaker 2: be here. Well, let's start with home Depot, the nation's

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Speaker 2: biggest do it yourself chain. What are you expecting to

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Speaker 2: see from Home Depot?

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Speaker 8: Well, last quarter they had their fifth straight decline in

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Speaker 8: comparable sales, and it looks like they're going to have

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Speaker 8: their sixth straight in this coming quarter. So we're looking

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Speaker 8: at sales probably being down about two percent as they

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Speaker 8: continue to just face this challenging environment. You know, consumers

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Speaker 8: are pretty resilt but also weary from the persistent inflation.

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Speaker 8: You know, it's obviously moderated, but you know it's it's

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Speaker 8: not deflation. So you know, people still remember when prices

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Speaker 8: were lower, you know, not that long ago, and so

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Speaker 8: they're pulling back, especially on their big ticket purchases, and

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Speaker 8: so Home Depot is going to continue to suffer from that.

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Speaker 8: But you know, it does look like there's some you know,

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Speaker 8: possible green shoots for them that that could you know,

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Speaker 8: perhaps lead to some outperformance. They had some they had

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Speaker 8: a decent discounting event, a sort of spring Black Friday

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Speaker 8: event that ran through April, and that might help them

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Speaker 8: a little bit on the sort of do it yourself

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Speaker 8: or end. And then of course there's their professional contractor sales,

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Speaker 8: which are a big focus for them and those are

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Speaker 8: probably holding up decently.

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Speaker 2: So well, this time of year is when you spruce

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Speaker 2: up the launch, when you start those projects, and when

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Speaker 2: you do even just spring cleaning. Now that has got

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Speaker 2: to help them. But is it higher prices, Is it

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Speaker 2: worries about the economy, about jobs that maybe holding things back?

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Speaker 8: Yeah, I think it's it's all of that. And you know,

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Speaker 8: of course the you know, sort of the housing situation itself,

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Speaker 8: you know, with existing home sales being relatively relatively weak. Yeah,

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Speaker 8: so we'll look to see if that starts to bottom out,

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Speaker 8: you know, but we're probably not going to see that

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Speaker 8: for this this quarter that they're going to be reporting.

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Speaker 8: So they're they're you know, analysts are saying that things

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Speaker 8: might start to look better for them toward the end

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Speaker 8: of this year into twenty twenty five.

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Speaker 2: Well, you talked about how the housing market impacts home deepot.

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Speaker 2: We know from Whirlpool that said people are not buying

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Speaker 2: these big appliances because they're not moving. Yeah, and these

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Speaker 2: got to be high margin purchases for home depots. So

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Speaker 2: is it just that, is it barbecue grills, is it

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Speaker 2: you know, is it everything?

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Speaker 8: Yeah, I mean, it's it's it's a bit of everything.

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Speaker 8: And you mentioned those big ticket purchases again, that is

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Speaker 8: exactly what people are pulling back on, in part because

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Speaker 8: they bought so many of those things during the pandemic

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Speaker 8: as they were stuck at home and spruced up their

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Speaker 8: homes because they weren't going anywhere else. And you know,

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Speaker 8: so now they have things that you know, last you know, three,

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Speaker 8: four or five years, and so they don't need to

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Speaker 8: buy another one. So that's that's one of the things

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Speaker 8: that they're running into still difficult comparisons. But you know,

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Speaker 8: again that focus on professional contractors is you know, sort

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Speaker 8: of something that they're increasingly you know, sort of aiming at.

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Speaker 8: And we saw that of course with their big purchase

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Speaker 8: announcement of SRS Distribution, you know, an eighteen billion dollar

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Speaker 8: acquisition that they announced last quarter.

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Speaker 2: So well, like everyone else, it's services. Services will will

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Speaker 2: lead you to the future, will Well let's move on

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Speaker 2: to Walmart. So what do you expect to see in

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Speaker 2: their results and their outlook for the.

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Speaker 6: Rest of the year.

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Speaker 8: Yeah, so Walmart is looking like you know, they uh,

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Speaker 8: you know, they will probably benefit from this environment as

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Speaker 8: as people uh, you know start to look for value

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Speaker 8: and and perhaps trade down from from higher priced retailers. Uh,

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Speaker 8: so we are probably going to see their same story

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Speaker 8: sales increase. It looks like the Easter season was pretty

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Speaker 8: uh solid for them. And uh again with that, you know,

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Speaker 8: sort of value seeking among consumers.

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Speaker 9: Uh.

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Speaker 8: You know, Walmart tends to do pretty well with that.

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Speaker 8: You know, they are you know, also looking at areas

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Speaker 8: beyond retail, uh to to seek further growth, you know.

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Speaker 8: And and they made an announcement of their own of

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Speaker 8: an acquisition of Visio, the the TV makers, and uh,

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Speaker 8: you know, some people were a little surprised, you know,

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Speaker 8: Walmart getting into making TVs, but this is all an

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Speaker 8: advertising play. You know, they have their internal advertising business

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Speaker 8: Walmart Connect and Visio of course serves ads to people

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Speaker 8: who have their smart TVs.

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Speaker 2: And so the idea and streaming TV service, that's exactly

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Speaker 2: it's all connected.

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Speaker 8: Yes, So so that's you know, that's so that's one

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Speaker 8: area that the Walmart is looking at to sort of

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Speaker 8: diversify and you know, continue to build even as they

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Speaker 8: you know, try to maximize their strengths with you know,

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Speaker 8: sort of general retail.

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Speaker 2: Well, a lot of big earnings coming up and our

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Speaker 2: thanks to John Edwards, Bloomberg News US Consumer team Leader,

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Speaker 2: and coming up on Bloomberg day Break weekend to look

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Speaker 2: at how European efforts to attract foreign investments are hitting

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Speaker 2: some turbulence. I'm Tom Busby, and this is Bloomberg. This

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Speaker 2: is Bloomberg day Break weekend, our global look ahead, the

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Speaker 2: top stories for investors in the coming week, and up

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Speaker 2: later in our program a look at some key tech

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Speaker 2: earnings in China and whether they might provide some momentum

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Speaker 2: to recent stock market gains. But first, European economies have

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Speaker 2: seen a strong start to twenty twenty four, with signs

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Speaker 2: of growth and economic activity picking up, and as the

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Speaker 2: European Central Bank prepares to cut rates, leaders are looking

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Speaker 2: to build on that momentum with foreign investments. French President

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Speaker 2: Emmanuel Macron will attempt to wu international investors at this

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Speaker 2: week's annual Choose France summit. For more, let's go to

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Speaker 2: London and bring in Bloomberg Daybreak eurobanker Stephen Carroll tom born.

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Speaker 3: In twenty eighteen to promote France as a business and

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Speaker 3: investment destination. The pace of Versailles serves as the opulent

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Speaker 3: backdrop for Emmanuel Macron's Choose France summits now in its

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Speaker 3: seventh year. It brings global CEOs together with top level

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Speaker 3: French officials to encourage them, as the name suggests, to

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Speaker 3: choose France, and it seems to be working. France recently

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Speaker 3: has come out on top again in Ey's FDI attractiveness survey,

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Speaker 3: at least by number of projects rather than value. But

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Speaker 3: that's led the French finance Minister Bruno Lemayer to pat

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Speaker 3: his government on the back for the economic reforms they've passed.

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Speaker 3: But as our Bloomberg opinion columnist Leonella Roah has been

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Speaker 3: writing recently that Pitch could be hitting some turbulence. Political

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Speaker 3: riffs between Paris and top corporate leaders seem to be

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Speaker 3: on the rise, a widening gap between the US and

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Speaker 3: Europe in terms of economic growth and approach to managing

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Speaker 3: the energy transition, as the French oil major Totel NLG

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Speaker 3: threatening to unchoose France by moving its stock market listing

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Speaker 3: across the Atlantic. Now, the economic outlook in France and

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Speaker 3: across Europe just isn't as bright as in the US,

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Speaker 3: and that's something that we've been discussing with Rafaela Tenconi,

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Speaker 3: chief economist at Ada economics.

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Speaker 10: France in relative terms definitely is in a better position

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Speaker 10: than Germany, but a lot of the growth, to be honest,

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Speaker 10: is in the periphery, you know, I mean, Italy is

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Speaker 10: surprisingly resilient, Greece is resilient, Eastern Europe is quite resil

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Speaker 10: I mean, given the weakness of the exports. In reality,

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Speaker 10: you know, the Union is not doing too bad. Of course,

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Speaker 10: the critical ingredient here is lower rates. If the ECB

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Speaker 10: does not cut rates, then we're stuck in stagnation and

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Speaker 10: then you will begin to see unemployment next year. But

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Speaker 10: it appears the ECB has finally come around to the

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Speaker 10: idea that one hundred basis points of using that's our review,

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Speaker 10: you know, this year is tolerable, if not desirable. So

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Speaker 10: that is enough to really reinnite lending activity.

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Speaker 5: And so to that.

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Speaker 11: Some of the fundamental challenges for Europe being low market

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Speaker 11: valuations in Europe versus the US, really even more deep

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Speaker 11: low valuations than we've seen in previous decades, and kind

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Speaker 11: of geopolitical challenges from Ukraine to Chinese Engene things visiting Europe,

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Speaker 11: and that's one of the kind of big issues that

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Speaker 11: has held back Germany. Do you see that changing the

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Speaker 11: low valuations too. We're also in a still an earning

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Speaker 11: secession in Europe.

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Speaker 10: Well, momentum is slightly more constructive because valuation are so low,

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Speaker 10: and I think in any case there is a delta

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Speaker 10: that is coming through. But structurally Europe needs to address,

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Speaker 10: you know, the single market, needs to deepen the Single market.

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Speaker 10: So I am for the first time in many, many years,

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Speaker 10: I'm encouraged to see genuine political backing. You know, there

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Speaker 10: was the letter report presented. Drug is also pushing for that,

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Speaker 10: and if the European elections in June go has the

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Speaker 10: opinion poll's signal, then you will begin to see deepening

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Speaker 10: of the Single market already next year, where retail participation

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Speaker 10: also will become a better ingredient. And that is very

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Speaker 10: important because as I said before, European households have too

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Speaker 10: much cash at hand. They're used to deflation. We are

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Speaker 10: no longer in deflation historically, so not having a function

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Speaker 10: in capital market, it is creating negative wealth effects.

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Speaker 3: So that was Rafaela Tenconi, chief economist at Ada Economics,

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Speaker 3: speaking to myself and Carline Hepger on Bloomberg Daybreak Europe.

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Speaker 3: So is foreign investment then Europe's ticket to economic acceleration.

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Speaker 3: I've been discussing this with Bloomberg's europe correspondent at large,

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Speaker 3: Alberta and Ardeli, and I started by asking him why

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Speaker 3: fire interact investment is so important in Europe right now.

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Speaker 9: I think if we look at the current geopolitical climate

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Speaker 9: and economic climate around the world, it's very significant. So

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Speaker 9: you have like a contest almost between the US, Europe,

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Speaker 9: and China trying to attract or lock in investment in

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Speaker 9: their respective geographical areas. And Europe is a bit struggling

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Speaker 9: in this sense right now because its strength has really

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Speaker 9: been this international rules based order. So Europe is strong

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Speaker 9: when everyone plays by the same rules. But in recent

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Speaker 9: times we've seen a protectists really shift in the United States,

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Speaker 9: China doesn't really play by those same rules, and Europe

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Speaker 9: is kind of stuck in the middle trying to figure out.

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Speaker 9: On the one hand, trying to defend and push for

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Speaker 9: the rules. On the other hand, is trying to change

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Speaker 9: its models to adapt to this new world. But this

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Speaker 9: takes time, and it's difficult in a continent of twenty

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Speaker 9: seven different countries with different politics, different views to come

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Speaker 9: up with a united position on how to deal with

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Speaker 9: these issues.

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Speaker 3: Yeah, and of course we've seen some of that play

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Speaker 3: out in the recent trip from the Chinese president visiting France,

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Speaker 3: Hungary and Serbia, notably with each of those individual governments

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Speaker 3: very keen to try and attract attention from China for investment.

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Speaker 3: Do events like Choose France help when it comes to

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Speaker 3: boosting a country's individual profile.

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Speaker 9: Absolutely. I think if you look at the specific French initiative,

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Speaker 9: what sets it apart from other similar initiatives, say in

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Speaker 9: other European countries, is really the profile of the event.

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Speaker 9: Because most countries have FDI forums or events to try

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Speaker 9: and attract business and investment, be it something specific like

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Speaker 9: a startups or emerging technologies or bilateral relations with a country.

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Speaker 9: The thing that's kind of different about the French initiative

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Speaker 9: is its profile, the pomp and so there's also substance,

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Speaker 9: but other events have substance. It really is the profile

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Speaker 9: that sets it apart.

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Speaker 3: Doesn't help to counter a negative image that France has,

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Speaker 3: and the present Emmanuel Macron has really struggled to try

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Speaker 3: and combat this of it being a difficult place to

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Speaker 3: invest in, a difficult place to do business, something that's

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Speaker 3: often leveled by international investors at many parts of Europe

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Speaker 3: because of it being a regulatory power house.

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Speaker 9: It does in the sense that so on the one hand,

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Speaker 9: there have been reforms in France corporation tax, they've been

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Speaker 9: tax incentsives for R and D. It's easier to set

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Speaker 9: up companies now, there's lots of they're trying to cut uocracy,

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Speaker 9: lots of the other difficulties remain, so communicating those changes

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Speaker 9: definitely helps. The other thing, which I believe is kind

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Speaker 9: of helping France is the fact that it has long

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Speaker 9: pushed this idea of European sovereignty, and that idea often

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Speaker 9: fell on deaf ears. But because of a changing geopolitical

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Speaker 9: context where the United States, for example, is taking a

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Speaker 9: more robust approach to try and onshore investments and rely

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Speaker 9: more on its own components and raw materials and so on,

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Speaker 9: Macron's view of the world has more appeal now than

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Speaker 9: it did, say a few years ago. On the flip

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Speaker 9: side of that is, many times other countries perceive what

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Speaker 9: when Macron says we must do more in Europe, etc.

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Speaker 9: He really means France, And there's a bit of skepticism

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Speaker 9: in other countries around this agenda.

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Speaker 3: Is there a lot of inter European competition for in investment?

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Speaker 3: You know, is France sort of slightly eating the lunch

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Speaker 3: of its neighbors as well and holding an event like this.

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Speaker 9: That's a very good question. It's actually one of the

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Speaker 9: biggest debates right now in Europe because, for example, if

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Speaker 9: you take state aid, there's a debate in Europe that

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Speaker 9: rules around state aid should be loosened so that governments

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Speaker 9: can invest more in critical sectors because that is the

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Speaker 9: only way to compete with China and the US and others.

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Speaker 9: The challenge with that approach, however, is that a country

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Speaker 9: like France or Germany they have resources that a country

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Speaker 9: like Latvia or Estonia don't have. So the risk is

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Speaker 9: that it distorts the internal European market. So right now

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Speaker 9: you have some countries which have focused very much on

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Speaker 9: the innovative, on the cutting edge, and they've really attracted

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Speaker 9: investments in those sectors, say drones in Latvia, for example.

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Speaker 9: When a giant compared to them enters that same space,

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Speaker 9: they can put up a lot more state aid investments.

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Speaker 9: So if you look at where chip manufacturers or electric

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Speaker 9: vehicle manufacturers are setting up shop, they usually tend to

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Speaker 9: go to France, to Germany rather than other countries. That's

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Speaker 9: a challenge.

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Speaker 3: This is something that Enrica Letter brought up also in

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Speaker 3: his recent reporter looking at reforms to the internal market

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Speaker 3: in the EU. Is there appetite at a European level

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Speaker 3: to try to counterbalance.

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Speaker 5: Some of that?

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Speaker 9: I think this reform of the single market, let's call it,

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Speaker 9: in areas such as defense, is going to be one

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Speaker 9: of the biggest debates once the new European Commission comes

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Speaker 9: into play and the challenges. The short answer to your

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Speaker 9: question is their appetite. In Europe. There is appetite, and

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Speaker 9: there is a realization that there isn't really a choice.

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Speaker 9: There is a war on Europe's doorstep. Europe has to

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Speaker 9: reform its defense industry and the way it functions. However,

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Speaker 9: there are lots of butts in this debate. So countries

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Speaker 9: will say, yes, we want to do this, however we

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Speaker 9: don't want to do, for example, joint borrowing. But those

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Speaker 9: voices don't often say, well, where are we going to

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Speaker 9: find at least one hundred billion euros to invest in

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Speaker 9: our defense industries if it's not through joint borrowing. Other

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Speaker 9: countries such as France. Yes, we must invest in defense,

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Speaker 9: but we must invest in only in European companies, supply chains,

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Speaker 9: et cetera, et cetera. So again it goes back to this,

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Speaker 9: do you really mean France when you say this, rather

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Speaker 9: than looking at what is the actual defense need that

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Speaker 9: Europe has as a whole. So it's a very complicated question.

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Speaker 3: As with everything in the European Union, it gets very complex,

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Speaker 3: and you've twenty seven people sitting around a table. How

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Speaker 3: much has the Inflation Production Act in the US and

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Speaker 3: that massive amount of spending changed the conversation around that

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Speaker 3: in Europe and an ad does it add to a

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Speaker 3: realization that something has to be done at a broader

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Speaker 3: level rather than an individual country level.

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Speaker 9: So it has changed the debate dramatically. So, first of all,

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Speaker 9: Europe was mostly caught by surprise in terms of the

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Speaker 9: specifics there was. Secondly, it had an impact on the relationship,

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Speaker 9: at least in trade between the European Union and the

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Speaker 9: United States. So had they not been Russia's war against Ukraine,

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Speaker 9: the EU would have sued the United States at the

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Speaker 9: w too, would have been a lot more assertive in

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Speaker 9: its response, And the only reason it didn't is because

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Speaker 9: it wanted to maintain unity around Ukraine. It has started

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Speaker 9: to respond, so it has loosened some state aid rules

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Speaker 9: in key sectors. It has worked very hard to try

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Speaker 9: ryan get some concessions from the United States, but these

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Speaker 9: concessions have been really limited, and it has created this debate,

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Speaker 9: as we were saying before, about can you remain a

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Speaker 9: pure champion of a rules based system when not even

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Speaker 9: your closest ally is prepared to play by the same rule.

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Speaker 3: Thanks to Bloomberg's europe correspondent at large Alberta and our deli,

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Speaker 3: I'm Stephen Carolyn London. You can catch us every weekday

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Speaker 3: morning here for Bloomberg Daybreak Europe, beginning at six am

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Speaker 3: in London and one am on Wall Street.

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Speaker 2: Tom. Thank you, Stephen, and coming up on Bloomberg Daybreak weekend,

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00:25:38,760 --> 00:25:41,679
Speaker 2: I'll look ahead to some key tech earnings in China.

438
00:25:42,080 --> 00:25:56,439
Speaker 2: I'm Tom Busby and this is Bloomberg. I'm Tom Busby

439
00:25:56,520 --> 00:25:58,200
Speaker 2: in New York with your global look ahead at the

440
00:25:58,280 --> 00:26:01,399
Speaker 2: top stories for investors in the coming week. China stock

441
00:26:01,480 --> 00:26:04,200
Speaker 2: markets have enjoyed a significant rally in the first part

442
00:26:04,240 --> 00:26:06,640
Speaker 2: of this year, and events in the week ahead will

443
00:26:06,640 --> 00:26:09,720
Speaker 2: help answer the question of whether that can continue for more,

444
00:26:09,840 --> 00:26:12,920
Speaker 2: let's go to Daybreak Asia co hosts Brian Curtis and

445
00:26:13,080 --> 00:26:13,760
Speaker 2: Doug Krisner.

446
00:26:14,359 --> 00:26:17,919
Speaker 4: Tom Chinese equities have bounced back from multi year lows,

447
00:26:18,040 --> 00:26:21,000
Speaker 4: and recently the major benchmarks entered a bull market.

448
00:26:21,160 --> 00:26:24,400
Speaker 12: To be fair, those benchmarks still are below their twenty

449
00:26:24,480 --> 00:26:27,920
Speaker 12: twenty one highs by some forty to sixty percent.

450
00:26:27,800 --> 00:26:30,320
Speaker 4: But there's no denying the recent recovery and it may

451
00:26:30,440 --> 00:26:33,480
Speaker 4: still have legs if China's tech giants can deliver on

452
00:26:33,600 --> 00:26:35,000
Speaker 4: their earnings in the coming week.

453
00:26:35,200 --> 00:26:38,600
Speaker 12: Heavyweights ten Cent and Ali Baba will both publish results

454
00:26:38,640 --> 00:26:41,440
Speaker 12: on Tuesday, followed by JD dot Com and Buy Do

455
00:26:41,640 --> 00:26:42,400
Speaker 12: two days later.

456
00:26:42,680 --> 00:26:45,359
Speaker 4: Those four firms alone account for more than a quarter

457
00:26:45,480 --> 00:26:48,800
Speaker 4: of the MSCI China Index. Earlier, we asked Julia Wong

458
00:26:48,920 --> 00:26:52,080
Speaker 4: from JP Morgan Private Bank if the tech earnings might

459
00:26:52,119 --> 00:26:53,879
Speaker 4: be a catalyst for further games.

460
00:26:54,200 --> 00:26:57,159
Speaker 13: I do think that investors' sentiment towards big tech in

461
00:26:57,280 --> 00:26:59,920
Speaker 13: China has already warmed quite a bit on their thing

462
00:27:00,119 --> 00:27:03,119
Speaker 13: that we know, like gaming, for example, the regulatory process

463
00:27:03,240 --> 00:27:05,440
Speaker 13: worked a little better, so all of that gradually has

464
00:27:06,240 --> 00:27:09,040
Speaker 13: dripped through to market and probably are in the price

465
00:27:09,080 --> 00:27:11,159
Speaker 13: at this point, So we do think that earnings, of

466
00:27:11,240 --> 00:27:13,440
Speaker 13: course are important, but you know, we do need to

467
00:27:13,520 --> 00:27:17,160
Speaker 13: see a sustained turnaround in their guidance for the next

468
00:27:17,200 --> 00:27:20,360
Speaker 13: few years for the market to do even better from

469
00:27:20,400 --> 00:27:21,160
Speaker 13: where it is today.

470
00:27:21,400 --> 00:27:23,840
Speaker 4: For a preview of what we might expect, we're joined

471
00:27:23,840 --> 00:27:26,800
Speaker 4: here in Hong Kong by Robert Lee, Bloomberg Intelligence Senior

472
00:27:26,800 --> 00:27:31,440
Speaker 4: Analyst and Sarah Jung Bloomberg China Tech Reporter. Welcome to

473
00:27:31,520 --> 00:27:33,400
Speaker 4: both of you. Thanks very much for joining us. Sarah,

474
00:27:33,480 --> 00:27:36,080
Speaker 4: let me go to you first. Is it fair to

475
00:27:36,160 --> 00:27:38,800
Speaker 4: say that the big tech companies do need to show

476
00:27:38,880 --> 00:27:43,240
Speaker 4: some progress for this rally in equities to move forward

477
00:27:43,560 --> 00:27:45,760
Speaker 4: or are there other sectors taking leadership?

478
00:27:46,359 --> 00:27:49,360
Speaker 1: Definitely, I think tech will be the heavyweight that will

479
00:27:49,400 --> 00:27:51,680
Speaker 1: determine whether or not we'll see this rally continue to

480
00:27:51,760 --> 00:27:55,720
Speaker 1: go forward. Obviously, because this industry spans so many different

481
00:27:55,760 --> 00:28:00,280
Speaker 1: areas online sales, advertising, games, it's definitely been you used

482
00:28:00,359 --> 00:28:04,159
Speaker 1: as a gauge of where the Chinese consumer sentiment is

483
00:28:04,880 --> 00:28:06,960
Speaker 1: and if we're really seeing a recovery that we have

484
00:28:07,040 --> 00:28:10,800
Speaker 1: been expecting this year. So it will depend very heavily

485
00:28:10,880 --> 00:28:13,600
Speaker 1: on how tents and Alibaba and also JD Dot common

486
00:28:13,640 --> 00:28:15,320
Speaker 1: by do report next week.

487
00:28:15,480 --> 00:28:18,320
Speaker 12: Robert, I'm wondering whether we need to consider the fact

488
00:28:18,359 --> 00:28:21,359
Speaker 12: that these companies may miss on their results. I mean,

489
00:28:21,400 --> 00:28:23,600
Speaker 12: if you look back at what happened, let's say, as

490
00:28:23,640 --> 00:28:26,560
Speaker 12: an example, ten Cent, I believe the numbers that the

491
00:28:26,600 --> 00:28:31,200
Speaker 12: company reported for the fourth quarter failed to meet expectations.

492
00:28:31,280 --> 00:28:33,080
Speaker 12: So what happens if there is a miss.

493
00:28:33,480 --> 00:28:36,119
Speaker 14: Most of these businesses are quite seasonal in nature, so

494
00:28:36,320 --> 00:28:38,120
Speaker 14: typically Q one, which.

495
00:28:38,000 --> 00:28:40,640
Speaker 15: Is what they're about to report, is a weaker period.

496
00:28:40,760 --> 00:28:43,240
Speaker 14: So the Q two guidance as things pick up on

497
00:28:43,320 --> 00:28:47,000
Speaker 14: a seasonal basis, is absolutely going to be key and crucial.

498
00:28:47,360 --> 00:28:49,640
Speaker 14: But I think taking a step back from that, the

499
00:28:49,800 --> 00:28:52,520
Speaker 14: China market has been an Hong Kong market of clearly

500
00:28:52,600 --> 00:28:57,320
Speaker 14: being decoupled from Nasdak and most other Western markets. For

501
00:28:57,520 --> 00:29:01,800
Speaker 14: some period of time, you have seen foreign investors participating.

502
00:29:01,880 --> 00:29:04,720
Speaker 14: They've been sat on the sidelines or for whatever reasons,

503
00:29:04,800 --> 00:29:07,640
Speaker 14: have not been actively in the market. So we're beginning

504
00:29:07,680 --> 00:29:11,320
Speaker 14: to see signs of investors and overseas investors coming back

505
00:29:11,360 --> 00:29:14,560
Speaker 14: to the market. So I think obviously fundamentals and guidance

506
00:29:14,680 --> 00:29:17,160
Speaker 14: is key, but I think a bigger thing to keep

507
00:29:17,200 --> 00:29:21,480
Speaker 14: this rally going is ongoing participation or growing participation.

508
00:29:21,080 --> 00:29:22,160
Speaker 15: By foreign investors.

509
00:29:22,720 --> 00:29:25,520
Speaker 14: You know, perhaps fear of missing out for example, because

510
00:29:25,760 --> 00:29:29,640
Speaker 14: as the index continue needs to rally, or assuming that happens,

511
00:29:29,760 --> 00:29:32,200
Speaker 14: then this fear of missing out I think will be

512
00:29:32,520 --> 00:29:35,760
Speaker 14: potentially a bigger factor that could draw more people into

513
00:29:35,840 --> 00:29:38,400
Speaker 14: the rally and you know, make it more self sustaining.

514
00:29:38,760 --> 00:29:41,960
Speaker 4: Perhaps, if we look at the consensus estimates, ten Cent

515
00:29:42,080 --> 00:29:44,280
Speaker 4: is for a cast you have a six percent increase

516
00:29:44,320 --> 00:29:48,720
Speaker 4: in revenue and Ali Baba just under six percent. That

517
00:29:49,080 --> 00:29:52,640
Speaker 4: Robert doesn't sound like the ten Cent and Ali Baba

518
00:29:52,880 --> 00:29:53,600
Speaker 4: of yesteryear.

519
00:29:53,920 --> 00:29:58,280
Speaker 14: Absolutely, both companies and the issues impacting Ali Baba are

520
00:29:58,320 --> 00:30:01,960
Speaker 14: perhaps somewhat different, and the competition that's suffering from low

521
00:30:02,080 --> 00:30:08,080
Speaker 14: cost disruptors like Timu for example, affecting Ali Baba. But

522
00:30:08,360 --> 00:30:10,800
Speaker 14: both companies are in a more mature phase of development.

523
00:30:11,360 --> 00:30:15,840
Speaker 14: Some of that reflects the slower economic outlook within China,

524
00:30:16,160 --> 00:30:19,400
Speaker 14: but they're mature businesses now. They're very large, broad spread businesses.

525
00:30:19,560 --> 00:30:22,320
Speaker 14: So you know, like a river entering the more mature phase,

526
00:30:22,320 --> 00:30:24,200
Speaker 14: you would expect the growth of them deliver to be

527
00:30:24,400 --> 00:30:27,120
Speaker 14: at a more modest level. But there are some structural

528
00:30:27,200 --> 00:30:30,960
Speaker 14: issues different for both companies that are also I think impacting.

529
00:30:31,920 --> 00:30:34,200
Speaker 15: Give you a quick example, saturated markets.

530
00:30:34,680 --> 00:30:37,680
Speaker 14: Again, when China's core markets were building out in the

531
00:30:37,720 --> 00:30:40,560
Speaker 14: first place, you had a multiplier effect which really drove

532
00:30:40,640 --> 00:30:43,600
Speaker 14: their growth. But now because the economy is very well

533
00:30:43,640 --> 00:30:46,120
Speaker 14: developed on the technology side and the markets are quite

534
00:30:46,160 --> 00:30:49,840
Speaker 14: well saturated, competition is more of an issue, and in

535
00:30:49,920 --> 00:30:53,480
Speaker 14: a slowing economy that is impacting, always a headwind for

536
00:30:53,640 --> 00:30:54,880
Speaker 14: the growth of both companies.

537
00:30:55,120 --> 00:30:58,520
Speaker 12: Sarah, I'm wondering whether we need to address the regulatory regime.

538
00:30:58,600 --> 00:31:01,719
Speaker 12: We heard from Julia Wangam moment ago. She mentioned games.

539
00:31:02,160 --> 00:31:03,920
Speaker 12: When I think of games in China, I think of

540
00:31:04,040 --> 00:31:07,239
Speaker 12: ten Cent. This is something obviously that the government has

541
00:31:07,320 --> 00:31:11,600
Speaker 12: had a hand in. Is that cloud lifted completely from

542
00:31:11,640 --> 00:31:13,640
Speaker 12: the market, or do we need to consider the role

543
00:31:13,680 --> 00:31:16,040
Speaker 12: that the government may play in the way in which

544
00:31:16,160 --> 00:31:18,360
Speaker 12: some of these companies are managed going forward.

545
00:31:18,560 --> 00:31:21,040
Speaker 1: Over the last few quarters, we've seen management from both

546
00:31:21,120 --> 00:31:23,040
Speaker 1: of these companies that we're talking about, ten Cent and

547
00:31:23,080 --> 00:31:27,600
Speaker 1: Alibaba say that the regulatory environment has stabilized to some extent.

548
00:31:28,120 --> 00:31:30,840
Speaker 1: But then again, you know, we also see that investors

549
00:31:30,880 --> 00:31:34,400
Speaker 1: are still reacting to regulatory changes. For example, late last year,

550
00:31:34,880 --> 00:31:39,280
Speaker 1: when they had draft gaming curbs the market just reacted

551
00:31:39,360 --> 00:31:43,480
Speaker 1: very strongly, Tensa and Nettie's and other gaming companies falling

552
00:31:43,560 --> 00:31:47,520
Speaker 1: quite substantially, and not only swinging back later or earlier

553
00:31:47,600 --> 00:31:50,480
Speaker 1: this year. So I think investors are still quite skittish

554
00:31:50,520 --> 00:31:53,880
Speaker 1: about this. But from the broader outlook point of view,

555
00:31:54,160 --> 00:31:58,880
Speaker 1: we have seen the regulation stabilized to some extent, even

556
00:31:58,960 --> 00:32:02,800
Speaker 1: as those those fear continue to linger and to shadow

557
00:32:03,080 --> 00:32:04,480
Speaker 1: over these companies going forward.

558
00:32:04,600 --> 00:32:08,840
Speaker 4: Sarah earlier Doug asked about campex and about expanding, but

559
00:32:08,960 --> 00:32:12,280
Speaker 4: there has been some room for cost reduction of late

560
00:32:12,560 --> 00:32:13,560
Speaker 4: for some of these companies.

561
00:32:13,600 --> 00:32:14,320
Speaker 15: Does that continue.

562
00:32:14,720 --> 00:32:16,640
Speaker 1: Yeah, We've seen over the past year a lot of

563
00:32:16,680 --> 00:32:21,040
Speaker 1: these companies focusing very heavily on cost reduction, including layoffs,

564
00:32:21,160 --> 00:32:23,959
Speaker 1: massive restructuring. I think Alibaba is a very good example

565
00:32:24,000 --> 00:32:27,160
Speaker 1: of that. After they're sort of chaotic year long restructuring,

566
00:32:27,240 --> 00:32:30,080
Speaker 1: we saw that now they're streamlining their focus to just

567
00:32:30,200 --> 00:32:34,240
Speaker 1: focus on their core businesses, so domestic e commerce, international

568
00:32:34,280 --> 00:32:36,720
Speaker 1: e commerce, and the cloud side business, and then to

569
00:32:36,840 --> 00:32:39,640
Speaker 1: just sort of shed some of their non core assets

570
00:32:40,000 --> 00:32:43,160
Speaker 1: as they would describe them. So definitely, these companies are

571
00:32:43,240 --> 00:32:46,440
Speaker 1: thinking still about how to streamline costs, how to focus

572
00:32:46,560 --> 00:32:49,120
Speaker 1: in on the areas where they can actually start to

573
00:32:49,160 --> 00:32:52,840
Speaker 1: achieve growth, especially as Robert mentioned, with the domestic environment

574
00:32:52,880 --> 00:32:56,840
Speaker 1: being so competitive, really looking overseas or to other new

575
00:32:56,920 --> 00:32:58,840
Speaker 1: areas to still retain.

576
00:32:58,600 --> 00:32:59,280
Speaker 10: Some of that growth.

577
00:33:00,240 --> 00:33:02,600
Speaker 12: Sarah mentioned that these reports may give us a little

578
00:33:02,640 --> 00:33:04,800
Speaker 12: bit of insight into the health of the Chinese consumer,

579
00:33:04,840 --> 00:33:07,040
Speaker 12: and I'm wondering whether we need to take a step

580
00:33:07,120 --> 00:33:08,880
Speaker 12: back and look at the macro. We know that the

581
00:33:09,560 --> 00:33:12,320
Speaker 12: real estate market, the property market in China has still

582
00:33:12,440 --> 00:33:16,720
Speaker 12: been a drag on consumer sentiment. Give me an understanding

583
00:33:16,760 --> 00:33:19,080
Speaker 12: of where China is right now and it's recovery and

584
00:33:19,440 --> 00:33:22,000
Speaker 12: how that may manifest in the numbers we see in

585
00:33:22,040 --> 00:33:22,640
Speaker 12: the week ahead.

586
00:33:23,000 --> 00:33:26,200
Speaker 14: Okay, so I think the e commerce players such as

587
00:33:26,280 --> 00:33:30,040
Speaker 14: p d D and Ali Baba probably more exposed to

588
00:33:30,160 --> 00:33:33,880
Speaker 14: the pressures that were within the domestic economy. But as

589
00:33:33,920 --> 00:33:37,680
Speaker 14: I mentioned earlier, you know, economic growth in China is slowing.

590
00:33:38,160 --> 00:33:41,920
Speaker 14: It still is outperforming most other developed economies, but it's

591
00:33:42,160 --> 00:33:45,800
Speaker 14: entering a more slow, slower face. And so what we're

592
00:33:45,840 --> 00:33:49,600
Speaker 14: seeing is rising competition, particularly again from these low cost disruptors,

593
00:33:49,680 --> 00:33:53,000
Speaker 14: the tmus and machines, both within the domestic China market

594
00:33:53,040 --> 00:33:57,280
Speaker 14: and overseas, which are undercutting the whole business.

595
00:33:56,960 --> 00:33:59,280
Speaker 15: Proposition of established players like Ali Baba.

596
00:34:00,000 --> 00:34:03,040
Speaker 14: Competitive dynamics I think has been in focus and will

597
00:34:03,080 --> 00:34:07,000
Speaker 14: remain so on the e commerce side for some time. Again,

598
00:34:07,120 --> 00:34:10,319
Speaker 14: given the backdrop of slowing economic growth and as you said,

599
00:34:10,360 --> 00:34:12,440
Speaker 14: the pressures from their property sector.

600
00:34:12,880 --> 00:34:15,279
Speaker 4: Robert, it seems like there's a lot more up and

601
00:34:15,360 --> 00:34:18,840
Speaker 4: coming competition for Ali Barba than perhaps there is for

602
00:34:19,000 --> 00:34:21,960
Speaker 4: ten Cent. Now, I note that you are expecting a

603
00:34:22,120 --> 00:34:25,319
Speaker 4: thirty two percent increase in net income for ten Cent,

604
00:34:25,880 --> 00:34:29,399
Speaker 4: and that is presumably I mentioned earlier that ten Cent

605
00:34:29,800 --> 00:34:31,919
Speaker 4: the average for it cash was only for a six

606
00:34:32,000 --> 00:34:35,759
Speaker 4: percent increase in revenue. That's pretty interesting. So how does

607
00:34:35,840 --> 00:34:38,040
Speaker 4: ten Cent get to a thirty two percent increase in

608
00:34:38,160 --> 00:34:41,400
Speaker 4: net income with revenues only up maybe six or seven percent?

609
00:34:41,560 --> 00:34:42,160
Speaker 15: Very good question.

610
00:34:42,520 --> 00:34:44,520
Speaker 14: I think some of that's a base effect, because again

611
00:34:45,160 --> 00:34:47,520
Speaker 14: Q one, compared to last year, the economy was just

612
00:34:47,600 --> 00:34:51,080
Speaker 14: reopening at that point and recovering after the COVID lockdown.

613
00:34:51,239 --> 00:34:54,239
Speaker 15: So base effect is one part of that, and a

614
00:34:54,360 --> 00:34:55,120
Speaker 15: Sarah refer to.

615
00:34:55,440 --> 00:34:58,160
Speaker 14: I think the companies across the board have ever been

616
00:34:58,840 --> 00:35:03,120
Speaker 14: cutting costs, managing costs, or keeping costs flat, so there

617
00:35:03,160 --> 00:35:05,400
Speaker 14: has been revenue growth in all companies and with the

618
00:35:05,560 --> 00:35:09,000
Speaker 14: sort of natural operational gearing that's there, then that will

619
00:35:09,120 --> 00:35:12,120
Speaker 14: drive some margin increase and hence drop through to the

620
00:35:12,160 --> 00:35:14,799
Speaker 14: bottom line. But for a company like ten cents, they're

621
00:35:14,800 --> 00:35:18,359
Speaker 14: pushing into short videos. Their AI business is still at

622
00:35:18,360 --> 00:35:21,239
Speaker 14: a very early stage, but they are applying their large

623
00:35:21,320 --> 00:35:25,359
Speaker 14: language models to help enhance their advertising offering, and there

624
00:35:25,440 --> 00:35:28,719
Speaker 14: is evidence of that coming through, and that's much higher

625
00:35:28,760 --> 00:35:31,840
Speaker 14: margin business. You've got a mix shift to higher margin

626
00:35:31,960 --> 00:35:35,840
Speaker 14: revenue streams. So combination of all three base effect costs,

627
00:35:35,960 --> 00:35:40,520
Speaker 14: moderation or cost rationalization and the mix shift towards high

628
00:35:40,600 --> 00:35:42,480
Speaker 14: margin is really what's driving that.

629
00:35:42,960 --> 00:35:43,240
Speaker 6: Sarah.

630
00:35:43,320 --> 00:35:45,680
Speaker 12: It wasn't that long ago when we were discussing Ali

631
00:35:45,760 --> 00:35:49,160
Speaker 12: Baba and the spin off of the logistics armed Sinow

632
00:35:49,239 --> 00:35:51,759
Speaker 12: Smart Logistics. Is there a sense now that that is

633
00:35:51,800 --> 00:35:53,400
Speaker 12: dead in the water, that we're not going to get

634
00:35:53,440 --> 00:35:56,840
Speaker 12: a breakup of these individual businesses within Ali Baba.

635
00:35:56,960 --> 00:35:57,120
Speaker 6: Yeah.

636
00:35:57,160 --> 00:36:00,319
Speaker 1: So that's the quite interesting thing because actually literally one

637
00:36:00,400 --> 00:36:03,440
Speaker 1: year ago, that's when Ali Baba was announcing a very

638
00:36:03,440 --> 00:36:07,480
Speaker 1: specific timeline for their massive restructuring and all the spinoffs,

639
00:36:07,719 --> 00:36:10,960
Speaker 1: including what you mentioned is the IPO of their religistics

640
00:36:11,040 --> 00:36:14,480
Speaker 1: arms Hi now spin off of their cloud arm and

641
00:36:14,520 --> 00:36:19,359
Speaker 1: then also of the fresh grocery arm Fresh Hippo. Of course,

642
00:36:19,440 --> 00:36:21,400
Speaker 1: all of those things have now been put on hold.

643
00:36:22,120 --> 00:36:24,000
Speaker 1: Dead in the water is kind of a good term

644
00:36:24,080 --> 00:36:26,520
Speaker 1: to describe it. They've they've just said, oh, the valuation

645
00:36:26,680 --> 00:36:28,800
Speaker 1: isn't where they want it to be, So that's not

646
00:36:28,920 --> 00:36:30,719
Speaker 1: what they're looking at right now, and that's not their

647
00:36:30,760 --> 00:36:33,880
Speaker 1: focus at the moment. And now we've seen Ali Baba

648
00:36:33,960 --> 00:36:36,320
Speaker 1: go from trying to spin off all their businesses to

649
00:36:36,480 --> 00:36:40,080
Speaker 1: really focusing on their core business As I mentioned.

650
00:36:39,920 --> 00:36:40,400
Speaker 2: It's hi now.

651
00:36:40,480 --> 00:36:43,360
Speaker 1: For example, they're buying the entire stake now in this

652
00:36:43,520 --> 00:36:46,720
Speaker 1: logistics arm to be able to better service their domestic

653
00:36:46,800 --> 00:36:50,279
Speaker 1: and international commerce side. So it's really focusing in on

654
00:36:50,400 --> 00:36:52,960
Speaker 1: these businesses because they're realizing that they've just been bleeding

655
00:36:53,000 --> 00:36:55,680
Speaker 1: money on some of these other, as they describe it,

656
00:36:55,840 --> 00:36:59,719
Speaker 1: non core businesses for example offline retail. And we've heard

657
00:37:00,120 --> 00:37:03,000
Speaker 1: things about them exploring different sales of some of these

658
00:37:03,400 --> 00:37:06,920
Speaker 1: businesses for example sun Art and other businesses that they

659
00:37:06,960 --> 00:37:10,239
Speaker 1: don't no longer see as profitable and necessary. So what

660
00:37:10,360 --> 00:37:12,759
Speaker 1: we're looking to hear this time from their earnings is

661
00:37:13,160 --> 00:37:16,240
Speaker 1: just a clear strategy direction for what's what we're gonna

662
00:37:16,320 --> 00:37:19,040
Speaker 1: see going forward now that they've sort of unwhound their

663
00:37:19,080 --> 00:37:23,439
Speaker 1: whole restructuring spin off sort of plan. What's the plan

664
00:37:23,600 --> 00:37:25,879
Speaker 1: now to make sure that they can maximize the value

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00:37:25,960 --> 00:37:27,120
Speaker 1: from their core businesses.

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00:37:27,640 --> 00:37:29,520
Speaker 12: I think we can agree that these earnings come at

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00:37:29,560 --> 00:37:32,040
Speaker 12: a crucial time for the Chinese equity market. Thanks to

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00:37:32,080 --> 00:37:34,360
Speaker 12: the both of you for helping us to preview the

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Speaker 12: week ahead and what we are likely to see from

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00:37:36,800 --> 00:37:39,560
Speaker 12: ten Cent, Ali Baba JD dot com and Buy Do.

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00:37:40,000 --> 00:37:44,520
Speaker 12: Robert Lee, Bloomberg Intelligence Senior Analyst and Sarah Jong Bloomberg

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00:37:44,840 --> 00:37:48,160
Speaker 12: China Tech Reporter. I'm Doug Prisner along with Brian Curtis

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00:37:48,280 --> 00:37:50,480
Speaker 12: in Hong Kong. You can catch us weekdays here from

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00:37:50,480 --> 00:37:53,600
Speaker 12: Bloomberg Daybreak Asia beginning at eight am in Hong Kong

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Speaker 12: eight pm on Wall Street. Tom.

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Speaker 2: Thank you, Doug, and thank you Brian. And that does

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Speaker 2: it for this edition of Bloomberg day Break Weekend. Join

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00:38:02,360 --> 00:38:04,640
Speaker 2: us again Monday morning at five am Wall Street time

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00:38:04,680 --> 00:38:07,160
Speaker 2: for the latest on markets overseas and the news you

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Speaker 2: need to start your day. I'm Tom Buzzby.

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Speaker 6: Stay with us.

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Speaker 2: Top stories and global business headlines are coming up right

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Speaker 2: now