WEBVTT - Bloomberg Daybreak: May 12, 2022 - Hour 1 (Radio) 0:00:03.440 --> 0:00:07.000 Live from the Bloomberg Interactive Brooker Studios is Bloomberg day 0:00:07.000 --> 0:00:10.520 Break for Thursday May twelve two. Coming up this hour, 0:00:10.800 --> 0:00:14.600 the Wall Street sell off spreads overseas global team coverage 0:00:14.600 --> 0:00:18.400 straight ahead. Cryptocurrency has resumed declines as bitcoin nears twenty 0:00:18.480 --> 0:00:22.400 five thousand. Investors await another reading on inflation, and Disney 0:00:22.440 --> 0:00:25.560 shares to drop on the company's growth. Altbook. Governor Murphy 0:00:25.600 --> 0:00:29.120 seeks to require New Jersey insurers to cover abortion costs. 0:00:29.160 --> 0:00:31.840 Plus reactions to the US send its vote to block 0:00:31.880 --> 0:00:36.160 abortion rights like along more ahead, I'm John Stashow. In sports, 0:00:36.200 --> 0:00:38.560 the Rangers survived. They beat the Penguins to force the 0:00:38.600 --> 0:00:41.239 game six in Pittsburgh. The Mets lost another win for 0:00:41.280 --> 0:00:47.400 the Yankees. That's all trained ahead on Bloomberg Daybreak on 0:00:47.520 --> 0:00:51.640 Bloomberg eleven three on New York, Bloomberg nine one, Washington, 0:00:51.760 --> 0:00:55.360 d C, Bloomberg one oh six one, Boston, Bloomberg nine 0:00:55.400 --> 0:00:59.240 sixties and Francisco Sirius x M one nine team and 0:00:59.320 --> 0:01:02.040 around the world Old on Bloomberg Radio dot Com and 0:01:02.200 --> 0:01:09.080 via the Bloomberg Business Oppy. Good morning. I'm Nathan Hagar 0:01:09.400 --> 0:01:12.240 and I'm Karen Moscow, and we're watching US dock index 0:01:12.280 --> 0:01:16.000 futures fall this morning extending yesterday is sell off. We're 0:01:16.000 --> 0:01:17.640 coming up to five oh one on Wall Street, and 0:01:17.680 --> 0:01:20.120 we checked the markets every fifteen minutes throughout the trading day. 0:01:20.160 --> 0:01:23.520 On Bloomberg, SNP Future is down about twenty five points down. 0:01:23.600 --> 0:01:26.600 Future is down a hundred forties six, and NASTAG futures 0:01:26.600 --> 0:01:29.400 down a hundred thirty three. The decks in Germany's down 0:01:29.400 --> 0:01:33.279 two point two percent. The tenure treasury of thirty seconds 0:01:33.360 --> 0:01:35.600 yield two point eight three percent, and they yield on 0:01:35.640 --> 0:01:38.880 the two year two point five seven percent, and NIMEX 0:01:38.920 --> 0:01:42.360 screwed oil is down about two and a half percent. Nathan, Yeah, 0:01:42.400 --> 0:01:45.839 we're going to continue watching this inflation fueled sell off. Karen. 0:01:45.880 --> 0:01:48.800 It's got US stocks beginning this session at their lowest 0:01:48.920 --> 0:01:52.400 level since March of last year. The hotter than expected 0:01:52.400 --> 0:01:55.440 print we got on consumer prices yesterday is sparking fears 0:01:55.440 --> 0:01:58.440 that the Federal Reserve may have to unleash even further 0:01:58.560 --> 0:02:02.320 tightening and that it tipped the economy into recession. Michael 0:02:02.400 --> 0:02:05.880 Darta is chief economist and macro strategist at MKM Partners. 0:02:06.560 --> 0:02:09.880 That's still a major problem for this bond market a 0:02:09.960 --> 0:02:13.239 major problem for this Federal reserve, and as we're seeing 0:02:13.360 --> 0:02:16.760 a major problem for the valuations that support the S 0:02:16.800 --> 0:02:20.960 and P five M CAM Partners Michael Darda says the 0:02:21.000 --> 0:02:24.600 Fed missed the boat on inflation. The tech having NASDAC 0:02:24.720 --> 0:02:27.440 humbled more than three percent yesterday. It's now lost more 0:02:27.480 --> 0:02:29.760 than a quarter of its value so far this year. 0:02:29.800 --> 0:02:33.919 Austin Graph is a portfolio manager at Truemark Investments. You're 0:02:33.960 --> 0:02:37.560 seeing a continuation of kind of what we've seen throughout 0:02:37.600 --> 0:02:40.320 the entire year so far, where you're seeing some of 0:02:40.360 --> 0:02:43.120 the high fliers the last few years and the growth 0:02:43.200 --> 0:02:48.000 names training off Truemark Investments. Austin Graph notes Apple is 0:02:48.040 --> 0:02:51.040 down about twenty percent from its recent high. In fact, 0:02:51.040 --> 0:02:53.720 the iPhone maker has now been surpassed by Saudio Ramco 0:02:53.840 --> 0:02:57.519 as the world's most valuable company. Well, Nathan, yesterday sell 0:02:57.560 --> 0:03:00.200 off is spreading overseas and we begin our Globe bull 0:03:00.240 --> 0:03:03.520 team coverage now with the Bloomberg's You and part Live 0:03:03.560 --> 0:03:06.240 in London. Good morning You, and good morning Karen and Nathan. 0:03:06.280 --> 0:03:08.880 Plenty of read on traders bloom blow screens this morning. 0:03:09.000 --> 0:03:12.160 Europe Investors taking fright at that stubborn US inflation. The 0:03:12.200 --> 0:03:16.240 Stoftie hundred down two point one. Mining stocks the worst 0:03:16.240 --> 0:03:19.280 performing sector, down more than four percent, but real estate 0:03:19.320 --> 0:03:21.919 and carmakers also near the bottom of the table. All 0:03:22.080 --> 0:03:25.080 twenty industry groups lower this morning. As to the markets, 0:03:25.120 --> 0:03:27.160 the foot Sea here in London one of the worst performing, 0:03:27.280 --> 0:03:29.880 down two point three percent. Live in London, I'm you 0:03:29.960 --> 0:03:31.919 and parts in Big Daybreak, May you and thanks. We 0:03:31.960 --> 0:03:35.160 saw the same selling pressure overnight in Asia. Let's continue 0:03:35.200 --> 0:03:38.800 our team coverage now. Bloomberg's Juliette Sally joins us from Singapore. 0:03:38.840 --> 0:03:41.200 Good morning, juliet, Good morning, Nathan and Karen. The m 0:03:41.320 --> 0:03:44.080 c I Asia Pacific Index fell to June twenty twenty 0:03:44.120 --> 0:03:47.360 lows is new COVID cases in Shanghai damp and prospects 0:03:47.360 --> 0:03:51.080 for reopening. Investors also appearing to be unimpressed by Premier 0:03:51.160 --> 0:03:54.720 Leese comments urging officials to use fiscal and monetary policies 0:03:54.720 --> 0:03:57.880 to stabilize employment and the economy. Hong Kong shares came 0:03:57.960 --> 0:04:00.480 under pressure as the city and defened dip end its 0:04:00.520 --> 0:04:03.960 currency for the first time since twenty nine. In Singapore. 0:04:04.040 --> 0:04:07.200 Juliette Sale bloom Bag Daybreak Delianne, Thank you, But we're 0:04:07.240 --> 0:04:11.040 also seeing cryptocurrencies continue their sell off. This morning, we 0:04:11.080 --> 0:04:13.880 get the latest on that line from Bloomberg's Randa Young 0:04:13.960 --> 0:04:16.560 in New York and morning Ranida, Good morning Karen. Bitcoin 0:04:16.680 --> 0:04:19.960 is trading at its lowest level since twenty twenty. At 0:04:19.960 --> 0:04:23.320 one point this morning, it touched just over twenty five thousand, 0:04:23.640 --> 0:04:26.680 and right now it's trading at close to twenty eight thousand. 0:04:27.000 --> 0:04:29.880 It's been falling in conjunction with the regular market, but 0:04:29.920 --> 0:04:32.920 the collapse of the terra usd stable coin is triggering 0:04:32.960 --> 0:04:36.159 a flight from many of the large digital tokens, and 0:04:36.200 --> 0:04:38.560 backers of the coin are trying to raise about one 0:04:38.560 --> 0:04:41.880 point five billion dollars to shore up the token. Stable 0:04:41.960 --> 0:04:44.880 Coins are key elements of the crypto market. There were 0:04:44.920 --> 0:04:47.320 traders park funds as they move them in and out 0:04:47.360 --> 0:04:50.400 of other tokens. The total value of all stable coins 0:04:50.480 --> 0:04:54.040 is beyond one hundred billion dollars. Live in New York. 0:04:54.120 --> 0:04:57.000 I'm Nita Young, Bloomberg Day break. All right, Nita, thank you. 0:04:57.080 --> 0:04:59.680 Let's turn to corporate earnings on Wall Street. Now, that's 0:04:59.720 --> 0:05:02.880 what's driving shares of Disney lower down about five percent 0:05:03.000 --> 0:05:06.839 in early trading. The company reported subscriber gains for its 0:05:06.839 --> 0:05:12.160 flagship streaming service. Those beat estimates, but Disney's also tempering 0:05:12.200 --> 0:05:14.760 its outlook for the year. We get the details on 0:05:14.800 --> 0:05:18.120 that from Bloomberg's Charlie Palace. Disney said it will trim 0:05:18.200 --> 0:05:21.560 spending on movies and TV shows. On the conference call, 0:05:21.680 --> 0:05:25.120 CEO Bob Japeck said Disney is lowering its projection for 0:05:25.240 --> 0:05:28.919 overall film and TV spending by one billion dollars to 0:05:29.040 --> 0:05:32.560 thirty two billion this year. Disney did report battled and 0:05:32.640 --> 0:05:36.200 expected growth in its flagship Disney Plus streaming service, while 0:05:36.279 --> 0:05:40.560 saying half of Disney Plus subscribers are adults without kids 0:05:41.080 --> 0:05:44.320 in New York. Charlie Palace to Bloomberg day break. All right, Charlie, 0:05:44.400 --> 0:05:46.800 thank you well. On the economic front, today, we'll get 0:05:46.839 --> 0:05:50.080 another key reading on inflation the producer price and next 0:05:50.120 --> 0:05:52.479 comes out of eight thirty am Wall Street Time, and 0:05:52.520 --> 0:05:56.120 we get a preview from Bloombery Smuchael McKee. Inflation isn't 0:05:56.120 --> 0:05:59.040 going away soon, but it may ease a bit. Producer 0:05:59.080 --> 0:06:02.000 prices are forecast US to have increased more slowly in April, 0:06:02.080 --> 0:06:05.039 following a stronger than expected gain the previous month, while 0:06:05.080 --> 0:06:08.840 food prices continued to accelerate. Oil prices retreated in April. 0:06:08.920 --> 0:06:12.880 Supply chain snarls could worsen amid China's COVID lockdowns, suggesting 0:06:12.880 --> 0:06:15.880 wholesale inflation will be slow to recede. Coming after a 0:06:15.960 --> 0:06:18.720 firm April CPI, the p p I is unlikely to 0:06:18.760 --> 0:06:22.080 add much to market thinking about inflation or the Fed's 0:06:22.120 --> 0:06:26.000 plans for raising rates. Michael McKee, Bloomberg Daybreak. All right, Mike, thanks, 0:06:26.000 --> 0:06:28.599 As the Fed fights inflation, it's adding another member to 0:06:28.720 --> 0:06:32.359 its ranks. The Senate has confirmed a third nominee of 0:06:32.360 --> 0:06:36.000 President Bidence to the FED Board. Makers confirmed economist Philip 0:06:36.080 --> 0:06:40.320 Jefferson as FED governor yesterday Today, Senate Democrats expect to 0:06:40.400 --> 0:06:43.800 vote on Jerome Powell's bid for a second term as 0:06:43.880 --> 0:06:46.920 Federal Reserve chair. And in the markets this morning, Nathan, 0:06:46.960 --> 0:06:49.560 we're seeing the impact of the recent bonds sell off. 0:06:49.600 --> 0:06:53.240 Pimco saw clients pull more than fourteen billion dollars from 0:06:53.240 --> 0:06:57.200 its funds last quarter as investors fled fixed income securities 0:06:57.240 --> 0:07:00.240 amid rising interest rates. Now the sell off an Equis 0:07:00.360 --> 0:07:03.640 continues this morning. Karen with SMP futures down down twenty 0:07:03.680 --> 0:07:07.159 eight points. Stown futures down a hundred seventy six. NASDAC 0:07:07.240 --> 0:07:09.440 futures are lower by a hundred thirty seven points. The 0:07:09.480 --> 0:07:13.000 tenure Treasury is up twenty three thirty seconds. Yield on 0:07:13.040 --> 0:07:17.080 the tenure two point eight to straight ahead local headlines 0:07:17.080 --> 0:07:23.440 in the check of Sports. This is Bloomberg and it's 0:07:23.480 --> 0:07:26.000 now five oh seven on Wall Street. Where's sixty degrees 0:07:26.160 --> 0:07:29.480 in Central Park? So far, so good on the roads. 0:07:29.920 --> 0:07:31.920 I hope I'm not jinxing at. Michael Bars here with 0:07:31.960 --> 0:07:33.640 more on what's going on in New York and around 0:07:33.640 --> 0:07:36.160 the world. Michael, good morning, Good morning, Nathan. New Jersey 0:07:36.200 --> 0:07:39.880 Governor Phil Murphy says he's backing legislation to protect and 0:07:39.920 --> 0:07:43.520 expand abortion access in the state. Murphy says that includes 0:07:43.560 --> 0:07:47.960 a requirement that insurers cover costs of the procedure. Abortion 0:07:48.080 --> 0:07:51.480 is healthcare, and healthcare decisions should be left up to 0:07:51.600 --> 0:07:57.280 the individual. Your body belongs to you. Governor Murphy says 0:07:57.320 --> 0:08:00.200 no one should be criminalized for getting the care they needed. 0:08:00.600 --> 0:08:03.400 It is the latest step taken by Democrats after elite 0:08:03.480 --> 0:08:06.760 opinion indicated the U. S. Supreme Court will owerturn the 0:08:06.840 --> 0:08:10.200 landmark gro v Way decision. The Democratic leadership in the 0:08:10.280 --> 0:08:13.520 US Senate has failed and its attempt to codify abortion 0:08:13.600 --> 0:08:16.480 rights in the law. Bloomberg said Baxter as the story, 0:08:16.920 --> 0:08:18.760 the vote to move the bill to the floor needed 0:08:18.840 --> 0:08:22.720 sixty eyes, it got forty nine. Vice President Kamala Harris 0:08:22.720 --> 0:08:25.480 immediately made it a campaign issue. And let's be clear, 0:08:25.520 --> 0:08:29.840 at the majority of the American people believe in defending 0:08:29.920 --> 0:08:33.800 a woman's right, her choice to decide what happens to 0:08:33.920 --> 0:08:37.000 her own body. The Senate Minority leader, Mitch McConnell, though, 0:08:37.040 --> 0:08:40.080 says he doesn't understand the uproar. Democrats were melting down 0:08:40.120 --> 0:08:44.199 because of the the Supreme Court may may uphold of Mississippi 0:08:44.240 --> 0:08:46.920 law of a limit abortion after fifteen weeks. The final 0:08:46.960 --> 0:08:49.760 Supreme Court opinion and ruling is due most probably in 0:08:49.880 --> 0:08:53.240 June in San Francisco. I'm at Baxter Bloomberg Gay Break. 0:08:53.640 --> 0:08:57.280 Finnish leaders have announced Finland must join NATO without delay 0:08:57.520 --> 0:09:01.560 given Russia's invasion in Ukraine. Burring Sweden is expected to 0:09:01.600 --> 0:09:04.880 decide on joining NATO in the coming days. New York 0:09:04.920 --> 0:09:08.160 City may Or may Eric Adams and the NYPD are 0:09:08.200 --> 0:09:11.840 demanding the federal government revoked the business license of a 0:09:11.920 --> 0:09:15.480 prominent gun manufacturer. They blame for the increase of ghost 0:09:15.600 --> 0:09:19.280 guns in the city. Adams says the company Polymer eighty 0:09:19.520 --> 0:09:23.560 sells untraceable, ready to assemble gun parts online. It comes 0:09:23.600 --> 0:09:26.280 as crime is on the rise in New York. Former 0:09:26.280 --> 0:09:29.760 New York Congressman Joe Crowley says the economic impact of 0:09:29.800 --> 0:09:32.240 the pandemic is partly to blame. I think this is 0:09:32.360 --> 0:09:35.680 all related in many respects to what's happened in terms 0:09:35.679 --> 0:09:39.040 of coming out of this virus, the you know, the 0:09:39.080 --> 0:09:41.440 COVID by TV, the impact that has had on the 0:09:41.480 --> 0:09:46.040 overall economy. Former Democratic Congressman Joe Crowley spoke on Bloomberg's 0:09:46.080 --> 0:09:49.280 balance of power with David weston Global News twenty four 0:09:49.320 --> 0:09:52.200 hours a day on air and on Bloomberg Quittake, powered 0:09:52.200 --> 0:09:54.800 by more than twenty seven hundred journalist antalists more than 0:09:55.200 --> 0:09:58.840 twenty countries. I'm Michael Barr. This is Bloomberg NA. Thanks Michael. 0:10:03.640 --> 0:10:05.240 Come up to five cent on Wall Street. Time for 0:10:05.240 --> 0:10:08.520 the Bloomberg Sports Update. Good morning, John Stesship, Good morning Nathan. 0:10:08.559 --> 0:10:10.760 The Rangers, had they lost last night, would have been 0:10:10.760 --> 0:10:13.640 playing golf today. Instead, they're traveling back to Pittsburgh for 0:10:13.720 --> 0:10:16.280 Game six tomorrow at the Garden. They trailed the Penguins 0:10:16.280 --> 0:10:18.839 to nothing, and then came alive through the house and 0:10:18.960 --> 0:10:22.840 up the right point steps Potter over again, Troup back 0:10:22.880 --> 0:10:31.360 a shutting Stars three two Rangers and three Ranger goals 0:10:31.480 --> 0:10:34.679 in two minutes forty two seconds, But thirteen seconds after 0:10:34.720 --> 0:10:37.520 the Rangers took the lead, the Penguins tied it on 0:10:37.600 --> 0:10:40.319 Jake Gensel's second goal the night seventh of the series, 0:10:40.440 --> 0:10:45.440 so Game five was tied. Called the Pluck down comes 0:10:45.480 --> 0:10:51.520 the Heatler shoot stores pilla Headle gives the rate Ers 0:10:51.600 --> 0:10:54.600 the lead with a power play goal early at period 0:10:54.720 --> 0:10:57.280 three fifteen. At the end, the Rangers won five three, 0:10:57.320 --> 0:10:59.559 but can they went in Pittsburgh where they just lost 0:10:59.559 --> 0:11:03.160 seven four and seven to Will. The Penguins have Sydney Crosby. 0:11:03.160 --> 0:11:06.000 He left last night with an injury. Florida beat Washington, 0:11:06.080 --> 0:11:09.479 Calgary beat Dallas, both go up three two. NBA Milwaukee 0:11:09.520 --> 0:11:11.560 came from fourteen down in the fourth quarter to win 0:11:11.640 --> 0:11:15.480 Game five in Boston. Memphis beat Golden State by thirty nine. 0:11:15.679 --> 0:11:18.960 Bucks and Warriors have the three two series lead at 0:11:18.960 --> 0:11:21.600 the stadium. Another win for the sizzling hot Yankees. They 0:11:21.600 --> 0:11:24.319 made a fifteen of the last seventeen beat Toronto five 0:11:24.360 --> 0:11:27.240 three labor Torres drove in all five MAT's at a 0:11:27.320 --> 0:11:30.280 three nothing first. Didn't lead in Washington Peter Alonzo Homer, 0:11:30.280 --> 0:11:32.120 but the Nationals with five in the bottom of the 0:11:32.160 --> 0:11:35.000 first and three more in the second eight runs off. 0:11:35.000 --> 0:11:38.520 Tyler McGill only got four outs the Nationals wanted eight. 0:11:38.600 --> 0:11:42.600 The three Johns Dash Bloomberg Sports NA Thanks john SMP 0:11:42.760 --> 0:11:45.400 futures down down twenty nine points, South Futures down a 0:11:45.480 --> 0:11:48.440 hundred eighty five. Nance Deck futures down a hundred forty 0:11:48.520 --> 0:11:52.240 three points. Bitcoin lower by three point two percent right 0:11:52.240 --> 0:11:55.040 now about twenty seven thousand, five hundred dollars as the 0:11:55.080 --> 0:11:59.640 sell off continues on renewed worries over inflation. We speak 0:11:59.679 --> 0:12:03.960 next with Drew Maddis, Chief Market Strategistic MetLife. This is 0:12:03.960 --> 0:12:10.040 Bloomberg Bloomberg eleven three oh weather. Partial sunshine today with 0:12:10.080 --> 0:12:12.839 highs in the low seventies. Scattered showers possible tomorrow with 0:12:12.880 --> 0:12:16.280 the high near seventy, and showers continue for Saturday with 0:12:16.320 --> 0:12:22.520 highs in the low seventies. Right now sixty one degrees. Markets, 0:12:22.600 --> 0:12:25.679 headlines and breaking news twenty four hours a day at 0:12:25.720 --> 0:12:29.079 Bloomberg dot Com. The Bloomberg business out and at Bloomberg 0:12:29.160 --> 0:12:39.120 quick takes a Bloomberg business blash and I'm Karen Moscow 0:12:39.200 --> 0:12:42.119 Global stocks and you watch. Stock Index futures are tumbling 0:12:42.120 --> 0:12:44.959 as stubborn inflation in the world's biggest economy adds to 0:12:45.040 --> 0:12:48.319 the case for more aggressive monetary tightening by the Federal Reserve. 0:12:48.640 --> 0:12:51.319 This is after the SMP five hundred dropped yesterday to 0:12:51.400 --> 0:12:53.800 its lowest since March of last year. We checked the 0:12:53.800 --> 0:12:56.600 markets every fifteen minutes throughout the trading day on Bloomberg 0:12:56.760 --> 0:12:59.880 SP futures down twenty nine points down, futures down a 0:13:00.040 --> 0:13:03.960 hundred eighty three NASDAG futures down one two The decks 0:13:03.960 --> 0:13:06.440 in Germany's down two and a half percent. Ten year 0:13:06.480 --> 0:13:09.440 treasury of twenty thirty seconds yeld two point eight four percent. 0:13:09.480 --> 0:13:11.960 They yield them a two year two point five seven percent. 0:13:12.440 --> 0:13:15.199 Nine max screwed oil is down two point one is 0:13:15.240 --> 0:13:17.400 down two point one percent on two dollars twenty three 0:13:17.440 --> 0:13:19.600 cents at a hundred three dollars fifty cents of Barrel 0:13:19.840 --> 0:13:22.240 Comics school down a quarter percent or five dollars at 0:13:22.240 --> 0:13:25.439 eighteen forty eight. Seventy announced the euro one point oh 0:13:25.440 --> 0:13:27.959 four four one against the dollar. British found one point 0:13:27.960 --> 0:13:30.839 to one and the end at one twenty eight point 0:13:31.000 --> 0:13:34.240 seven one. Bitcoin this morning falling down two point nine 0:13:34.240 --> 0:13:37.840 percent at twenty seven thousand and five hundred eighty dollars. 0:13:37.840 --> 0:13:40.080 And today we're looking for our appard on inflation at 0:13:40.080 --> 0:13:42.360 the whole sale level at eight thirty Wall Street Time, 0:13:42.600 --> 0:13:45.440 along with the weekly report on initial jobless claims as 0:13:45.480 --> 0:13:48.120 a Bloomberg Business Flash. Now here's Michael Barr with more 0:13:48.160 --> 0:13:50.679 on les's going on around the world. Uncle, good morning, 0:13:50.760 --> 0:13:55.000 Good morning, Karen. Ukraine's military says Russian forces are continuing 0:13:55.000 --> 0:13:58.960 air strikes on the steel plant in Meryouple. It comes 0:13:59.000 --> 0:14:02.240 in day seventy aid of the ward. Finland's president and 0:14:02.320 --> 0:14:06.280 prime ministers say they're in favor of applying for NATO membership. 0:14:06.760 --> 0:14:09.959 Neighboring Sweden is expected to decide on joining NATO in 0:14:10.080 --> 0:14:13.320 coming days. In the NHL Playoffs, the Rangers stay alive 0:14:13.360 --> 0:14:16.400 after beating the Penguins in Game five. The Capital is 0:14:16.440 --> 0:14:18.959 lost to the Pantherst fall behind in that series three 0:14:19.000 --> 0:14:22.160 games to two. NBA Playoffs, the Celtics lost to the 0:14:22.160 --> 0:14:24.800 Bucks and are now on the brink of elimination. The 0:14:24.840 --> 0:14:27.840 Warriors lost to the Grizzlies. Golden State still leads that 0:14:27.880 --> 0:14:31.320 series three to two. In baseball, the Yankees one, the 0:14:31.320 --> 0:14:33.920 Mets lost to the Nationals, Red Sox and Orioles lost. 0:14:33.920 --> 0:14:36.640 Giants and as one. Global News twenty four hours a 0:14:36.720 --> 0:14:39.200 day on air and on Bloomberg Quick Take, powered by 0:14:39.240 --> 0:14:43.200 more than hundred journalists analysts more than a hundred twenty countries. Hi, 0:14:43.280 --> 0:14:46.040 Michael bar this is Bloomberg Ni. Michael, thank you. It's 0:14:46.080 --> 0:14:49.080 five nineteen on Wall Street Live from the Bloomberg Interactive 0:14:49.080 --> 0:14:52.640 Brokers studios. This is Bloomberg Daybreak as we continue to 0:14:52.640 --> 0:14:57.320 watch the selling on inflation worries. Drew Maddis joins US 0:14:57.360 --> 0:15:01.280 now chief market strategist at MetLife in Estment Management. Drew, 0:15:01.320 --> 0:15:03.080 it's good to speak with you this morning. It sounds 0:15:03.160 --> 0:15:05.920 kind of silly to ask whether this UH sell off 0:15:05.960 --> 0:15:09.120 has further to run, because it seems like market participants 0:15:09.120 --> 0:15:12.240 are heading for the hills here. But I wonder if 0:15:12.240 --> 0:15:15.640 you're looking at any particular indicators to try to gauge 0:15:15.640 --> 0:15:19.760 whether there could be a bottom to this sell off. Well, 0:15:20.080 --> 0:15:22.960 I think it's it's interesting how you describe what's going on, 0:15:23.080 --> 0:15:26.360 because I see it as a sell off because people 0:15:26.360 --> 0:15:29.080 are afraid the Fed's going to try to handle inflation 0:15:30.080 --> 0:15:33.720 like they did in the nineteen seventies. When you when 0:15:33.760 --> 0:15:39.640 you actually see what's happening with things like forward inflation measures, uh, 0:15:39.760 --> 0:15:41.840 it's it's pretty clear that the market thinks the Fed 0:15:41.920 --> 0:15:45.440 can handle inflation. They're just worried that they're going to um. 0:15:45.480 --> 0:15:47.600 And that's not to say that the FED shouldn't try 0:15:47.640 --> 0:15:53.000 to contain inflation, but given that inflation and supply chain driven, uh, 0:15:53.040 --> 0:15:54.680 you know, maybe trying to get it back down to 0:15:54.760 --> 0:15:57.920 two percent or or even substantially below where it currently 0:15:58.000 --> 0:16:01.920 is might not be the appropriate policy. So if you 0:16:01.960 --> 0:16:04.920 say that inflation is supply chain driven, does that imply 0:16:05.120 --> 0:16:08.800 that the Fed might not feel as much pressure as 0:16:08.800 --> 0:16:11.400 the market is putting out there for something like a 0:16:11.560 --> 0:16:16.120 seventy five basis point rate hike sooner than has been telegraphed. 0:16:17.520 --> 0:16:19.120 I think that's right. I think I think one of 0:16:19.160 --> 0:16:21.440 the one of the misconceptions is that, you know, Pal 0:16:21.480 --> 0:16:24.640 has been very hawkish. At the last meeting, he had 0:16:24.720 --> 0:16:27.440 the chance to go seventy five. It wasn't fully priced in, 0:16:27.520 --> 0:16:29.320 but there were there were some people expecting it, and 0:16:29.320 --> 0:16:31.840 it would have been less of a surprise. Uh. And 0:16:31.880 --> 0:16:34.360 he had the chance to start quantitative tightening, you know, 0:16:34.400 --> 0:16:37.480 the next day. Uh, and instead he decided to they 0:16:37.480 --> 0:16:40.080 decided to push that off a month. So, you know, 0:16:40.120 --> 0:16:42.560 I think what's really going on is the FED understands 0:16:42.640 --> 0:16:44.600 part of the inflation problem is not one that can 0:16:44.640 --> 0:16:47.560 be solved. It's the supply chain side of it. Uh. 0:16:47.600 --> 0:16:50.040 There is some of it that's excess demand, and they 0:16:50.080 --> 0:16:52.760 get they're certainly acting on that. But I think the 0:16:52.800 --> 0:16:56.320 market thinks that the FED sees everything is nextcess demand story. Um, 0:16:56.400 --> 0:16:58.560 And I actually think they're misreading the Fed. I think 0:16:58.600 --> 0:17:02.480 palsmen very maybe a little too clever at kind of Um. 0:17:02.520 --> 0:17:04.159 You know what the FED is capable of, and what 0:17:04.240 --> 0:17:06.240 the FED isn't capable of, and what they're going to 0:17:06.280 --> 0:17:08.840 try to achieve. So do you think that the that 0:17:08.920 --> 0:17:12.119 the narrative in the market could shift based on what 0:17:12.160 --> 0:17:14.800 we get from consumer prices later I'm sorry, from producer 0:17:14.840 --> 0:17:18.800 prices later this morning? It could? You know, the CPI 0:17:18.880 --> 0:17:21.639 data yesterday was not helpful to to the idea that 0:17:21.680 --> 0:17:23.399 the FED. That you know is that it could be 0:17:23.440 --> 0:17:26.520 doing the right thing if if we're reading them correctly, um. 0:17:26.760 --> 0:17:29.240 But at the same point we did see inflation begin 0:17:29.280 --> 0:17:32.399 to peek. It's still running very high. But in my mind, 0:17:32.440 --> 0:17:35.040 what the FED is really targeting is their two percent 0:17:35.119 --> 0:17:38.760 target plus whatever percentage of inflation they think is due 0:17:38.800 --> 0:17:42.040 to supply chains, i e. The stuff that they can't control. 0:17:42.640 --> 0:17:45.040 And so in my mind, you know, when you're thinking 0:17:45.040 --> 0:17:47.680 about where the FED will stop, uh, you know, they'll 0:17:47.720 --> 0:17:50.199 stop once they control the inflation that they think they 0:17:50.200 --> 0:17:53.120 can control, and they'll hope that supply chains work themselves 0:17:53.119 --> 0:17:57.399 out over time. So what's your outlook then for whether 0:17:57.560 --> 0:18:00.720 we could be in for a recession later this year 0:18:00.760 --> 0:18:03.120 or next year? And where do you see inflation going 0:18:03.160 --> 0:18:06.040 by the end of this year based on what happens 0:18:06.040 --> 0:18:08.199 with supply chains? Doesn't make it tougher to sort of 0:18:08.200 --> 0:18:14.400 gauge where things go based on supply chain factors. It does, 0:18:14.520 --> 0:18:16.080 and I think that's the reason the market is kind 0:18:16.080 --> 0:18:18.040 of behaving the way it is is it's very difficult 0:18:18.040 --> 0:18:20.040 to to kind of see with it what the endgame is. 0:18:20.200 --> 0:18:22.040 You know, from our point of view, we see inflation 0:18:22.119 --> 0:18:25.040 drifting into the mid fours UM. So it's gonna be elevated, 0:18:25.119 --> 0:18:30.159 but it's not particularly horrible UM. And then on the 0:18:30.200 --> 0:18:33.240 recession question, we don't expect the recession this year. We 0:18:33.240 --> 0:18:35.480 would look for you know, if there's going to be 0:18:35.520 --> 0:18:38.720 a recession, we think it would be you know, margin lead, 0:18:38.960 --> 0:18:42.000 so firms see contracting margins, they're being the cutback on 0:18:42.119 --> 0:18:45.480 employment and investment. Uh. And we think that takes time 0:18:45.520 --> 0:18:48.320 to play out and is more likely a late twenty 0:18:48.359 --> 0:18:52.800 three early scenario, so you know, last thirty seconds. Then, Drew, 0:18:52.880 --> 0:18:57.359 do you see opportunities in this market? Well, I just 0:18:57.400 --> 0:19:00.080 think you you look at what's overdone, so yeah, I 0:19:00.119 --> 0:19:03.359 would say that there probably are opportunities. Um. You know, 0:19:03.840 --> 0:19:06.800 we think yields are heading back down uh to kind 0:19:06.800 --> 0:19:09.639 of the twenty five range UM by the end of 0:19:09.640 --> 0:19:11.600 the year. And I think that's you know, uh for 0:19:11.960 --> 0:19:15.240 an insurance company that that's kind of an opportunity right there. Alright, 0:19:15.280 --> 0:19:18.159 Drew Madis, thanks for this, really appreciated. Drew Madis is 0:19:18.240 --> 0:19:22.920 chief market strategist at MetLife Investment Management. As we continue 0:19:22.960 --> 0:19:25.040 to track the sell off this morning, we have SMP 0:19:25.160 --> 0:19:28.400 futures down down twenty seven points. Down futures are lower 0:19:28.400 --> 0:19:31.440 by a hundred sixty five points, and NASDAC futures leading 0:19:31.440 --> 0:19:34.080 declines right now, down a hundred forty points or one 0:19:34.119 --> 0:19:36.960 point two percent. Right now, the tenure Treasury is up 0:19:36.960 --> 0:19:40.000 twenty three thirty seconds, pushing the yield down just shy 0:19:40.080 --> 0:19:42.159 of two point eight three percent, and the yield on 0:19:42.200 --> 0:19:44.040 the two year right now is a two point five 0:19:44.119 --> 0:19:48.480 seven percent. Looking at commodities, NIMEX CREWD is lower by 0:19:48.640 --> 0:19:51.159 two point one percent right now, down two dollars and 0:19:51.320 --> 0:19:54.639 seventeen cents for a hundred three dollars fifty four cents 0:19:54.640 --> 0:19:57.400 of barrel. Just to add much more on this sell 0:19:57.440 --> 0:20:02.080 off and Disney's outlook not so magical. Top stories of 0:20:02.080 --> 0:20:09.040 the morning straight Ahead on Bloomberg day Break Bloomberg eleven 0:20:09.080 --> 0:20:11.800 three oh weather partly sunny, low seventies today, Scattered showers 0:20:11.800 --> 0:20:14.640 possible tomorrow with a high year seventy degrees, and we're 0:20:14.640 --> 0:20:17.800 looking for low seventies on Saturday with the chance for showers. 0:20:17.880 --> 0:20:24.000 Right now sixty one in Central Park, broadcasting live from 0:20:24.000 --> 0:20:27.800 the Bloomberg Interactive Broker Studio in New York. Bloomberg E 0:20:27.880 --> 0:20:31.840 Living Freedom to Washington, d C. Bloomberg on to Boston, 0:20:31.960 --> 0:20:35.760 Bloomberg one six one to San Francisco, Bloomberg nine sixty 0:20:35.920 --> 0:20:39.119 to the country, Sirius XM channel one nine and around 0:20:39.160 --> 0:20:43.119 the globe the Bloomberg Business and Bloomberg Radio dot Com. 0:20:43.119 --> 0:20:51.920 This is Bloomberg day Break. It's five thirty on Wall Street. 0:20:51.920 --> 0:20:54.720 Good morning. I'm Nathan Hager and I'm Karen Moscow, and 0:20:54.760 --> 0:20:57.200 we're just about four hours away from the open of 0:20:57.280 --> 0:20:58.960 US trading. Let's get you up to date on the 0:20:58.960 --> 0:21:01.520 news you need to know at sour yesterday is hot. 0:21:01.560 --> 0:21:06.360 Inflation reading is sending markets downward. Stocks begin the session 0:21:06.400 --> 0:21:09.840 at their lowest level since March of one. Former New 0:21:09.920 --> 0:21:12.760 York Fan Governor Bill Dudley says Fed here J. Powell 0:21:12.880 --> 0:21:16.080 may have to tighten monetary policy more than he's planning to. 0:21:16.480 --> 0:21:18.960 I think he's four to five or higher. Um, you 0:21:18.960 --> 0:21:21.120 know I was three or four, maybe six months ago, 0:21:21.640 --> 0:21:24.359 from four to five when shocked me. If I'm you know, 0:21:24.480 --> 0:21:27.199 five to six a few months from now. Former New 0:21:27.280 --> 0:21:29.800 York Fed Governor Bell Dudley says the Federal Reserve is 0:21:29.840 --> 0:21:33.440 not forcefully stated how it will lower inflation to two percent. 0:21:33.760 --> 0:21:36.119 We'll get another key inflation reading this morning when the 0:21:36.200 --> 0:21:39.159 Producer Price Index is released. Well, markets in Europe and 0:21:39.200 --> 0:21:42.000 Asia down as well. Karen European stocks are poised for 0:21:42.040 --> 0:21:45.760 their fifth straight week of declines, and crypto assets are tumbling. 0:21:45.800 --> 0:21:49.200 Nathan Bloomberg's Rinita Young joins US Live with more. Good morning, Nina, 0:21:49.280 --> 0:21:52.120 Good morning, Karen. Bitcoin is trading at its lowest level 0:21:52.200 --> 0:21:55.800 since twenty twenty. It touched just over twenty five thousand 0:21:55.800 --> 0:21:58.280 this morning. It is now trading it close to twenty 0:21:58.320 --> 0:22:01.840 eight thousand. It's been falling in conjunction with the regular market, 0:22:02.040 --> 0:22:04.960 but the collapse of the terra usd stable coin is 0:22:04.960 --> 0:22:08.040 triggering a flight from many of the large digital tokens. 0:22:08.400 --> 0:22:10.840