Skip to main content

We will keep fighting for all libraries - stand with us!

tv   Bloomberg Markets  Bloomberg  January 27, 2023 1:30pm-2:00pm EST

1:30 pm
mark: welcome this is first word news. we men have been charged to kill an iranian american author. merrick garland announced the arrest at a news conference today. the men are charged with money laundering and murder for hire. it's the second time in two years that federal officials have disrupted a plot aimed at the unnamed victim in new york city. tensions between israel and palestinian authorities have intensified following a deadly clash on the west bank. the deteriorating situation is threatening to overshadow secretary of state antony
1:31 pm
blinken's trip next week where he plans to meet with prime minister benjamin netanyahu's new administration. a gunfight with israeli soldiers thursday left eight militants and one civilian dead. it was one of the highest daily death tolls in the west bank in years. bloomberg has learned that letting her putin is planning a new offensive in ukraine. russian president is preparing his country for a conflict with the united states and its allies and he expects it to last for years. the kremlin wants to show its forces can regain the initiative after months of losing ground. it's open to force ukraine and its backers to agree to some kind of truce. there is no end to the fight over the debt ceiling in washington. republican leaders are considering a temporary increase until september 30 to allow more time to negotiate. democratic senator joe manchin says he told house speaker kevin mccarthy that social security
1:32 pm
and medicare should be off the table. global news, 24 hours a day, on-air and on bloomberg .on-air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. jon: welcome to bloomberg markets. kriti: we are seeing green on the screen because equity wasn't coming out on top. the s&p 500 is up but if you look at the nasdaq, almost higher by 1% which is crucial when you talk about having tech on your side for a more sustainable rally.
1:33 pm
we are seeing two basis points higher with a softening in the bond market but as the yield goes higher, the dollar also slightly stronger by about one/10 of 1%. crude is trading with a 79 handle. before i throw to you, there is one stock i want to keep and i on and that is txo energy partners that did an ipo today. these shares are higher by almost 12% on the day. it is an energy company that is an ipo in a macro economic economy. jon: the energy transition will give us a lot of talk about a greener future. you highlighted that tech has been in focus so let's have a tech team starting with tesla which is up 10%. we are getting more headlines
1:34 pm
from reuters reporting that elon musk met with officials from the biden administration about the electric vehicle production future in america. we had already seen the well-received quarter were is -- quarterly results from tesla. visa is different than american express but not a technology company but a similar theme with more travel helping the volumes for visa. the other tech story line coming out of the chip sector, kle the equipment maker, some worries on that and we been talking about the weakness for intel. kriti: let's stick with the intel story. bloomberg spoke with asset management and asked if this is a stock specific story or indicate something wider? >> you shouldn't read what's happening to this one company as
1:35 pm
representing the entire chip industry. intel is in a difficult position. there is a general negative trend for other chip stocks. i think this is stock specific. jon: we will dig in now with the very busy bloomberg intelligence agency employee. on the story line of all chip players being created equal, where do you weigh in? >> clearly, the market positioning matters for chipmakers. we were talking about the change since the beginning of the year and how exciting it was for a company like nvidia but the pc market is not as exciting. it's going through massive inventory correction and that's what we heard from intel last night. they don't expect it to bottom
1:36 pm
and one quarter, it could be the second quarter. until that happens, it's hard to see how intel can improve their topline and they have some problems on the server side which is more resilient in terms of demand. data dement -- data center demand is doing well but it's losing some shares. i think there are some company specific issues over there but they also have a pretty bad backdrop when it comes to the demand-side especially for pc chips. kriti: compare that to a d. there market cap dipped low that of market devices at amd. >> it has exposure to the same things that intel has. i think the one key metric for me next week is how the global shipments look, qualcomm and
1:37 pm
apple will give us a good sense of that. if the device patch we are going through in terms of inventory devices apply to pc, it should apply to smartphones as well and it could apply to others like automobiles. it will be important to see if this is pc specific and if it is, it will impact amd in my opinion. kriti: thank you so much. we are keeping him very busy. we thank you as always. another major this afternoon isn't american express reporting quarter results with the shares surging after the credit card firms 2023 revenue topped analyst expectations. they also soaked record cardholder spending in the last three months last year. we have more on the takeaways from the fourth quarter. it always comes down to consumer
1:38 pm
spending when we talk about the broader economy. what did american express tell us on that front? >> the bright spot is american express you suck consumers spending on their cards at a record pace last year and we heard from visa and mastercard earlier this week when they were talking about coming to volumes, they saw signs of pulling back. that was a signal that what we've seen when it comes to the inflation front starting to weigh on the consumer base but when i speak to analyst, when it comes to american express, it's a different clientele you could see the federal reserve depending on the trajectory of its rate hikes still potentially weighing on those type of stocks. in general, when you look at amex, when it comes to the sort of recessionary scenarios, spending would hit them last when it comes to customers. if you are looking more broadly at amex for the year, it is
1:39 pm
outperforming visa and mastercard but you still are seeing those stocks outperforming the broader s&p 500 and it's on the back of getting that monthly consumer spending data. when you look at the amex and the amex customer, it still seems like it's still happening for them. the fourth quarter was a key for holiday spending. jon: the travel part of this, the key link between visa and american express? >> it is and when you think about those types of travel rewards, you are seeing still a boom there is more people are going out and the connie is trying to move past the pandemic. there was a lot of spending in travel. we saw some of the pressure that airlines came under but it seems as if we are looking on the credit card side and people are
1:40 pm
looking to spend that money but it will be interesting to see how this plays out. we have the federal reserve meeting next week and that will give a trajectory on the fed three hikes and potentially how that will continue to impact credit card issuers. jon: thanks very much. let's stay on the broader influences from the fed but also the earnings story. joining us is ubs. one of the things that is interesting with the american express story is that wall street is rewarding encouraging outlooks, not necessarily whether you beat or missed in the quarter, it's how confident you sound for 2023 area what's been your takeaway in earnings season? >> to be honest, think the earnings season has been quite underwhelming so far. there are pockets where the outlook is looking better particular for the higher end consumer which is no surprise. lower end and middle consumers
1:41 pm
are starting to feel the pressures from the high interest rate environment. when we think about the forward outlook, the guidance is underwhelming and we see estimates coming down for 2023 but not fast enough think about the fourth quarter, the beat rate has been 20% even after we've seen significant downward revisions. the fourth quarter was where the economy still seems to be resilient and the consumer was still spending in 2023, that will change when you feel a drag of monetary policy. we steals -- we still think there will be a five or 10% downside risk to these numbers and we will get more of that as the earnings season progresses next week. kriti: when you look at perhaps some of these numbers, you are starting to see sales drag especially in the tech sector but isn't this what was priced into the equity market for most of last year? >> i think what was priced and
1:42 pm
was the pressure from interest rates moving higher. i don't think it's fully priced in. we think the recession will come. tech earnings particularly in the chip areas are under pressure and we had long known that pcs were but clearly, the expectations had not come down far enough and we could see that broaden out to cell phones and gaming and that we see it in the cloud so we don't think it's fully priced and. -- christ in. jon: let's talk about -- christ in. priced in. jon: we have already heard encouraging outlook from a luxury player on the reopening and how that impacts their business. how does it impact your thinking in investing this year? >> we recently upgraded china from a tactical standpoint
1:43 pm
because the reopening is happening faster than anyone anticipated. beyond that, we are seeing a change in the regulatory environment in china and the government focusing on more policies. it will not have as much impact in the u.s.. there are pockets within the u.s. that have exposure to china particularly on the casino side and the hotel side and on the commodity complex. that's one reason why we recently up rated commodities as well as prefer oil which will be $110 this year we think that will be driven by increased demand from emerging asia. kriti: that's something we will keep an i on. we thank you you as always. we are getting breaking news -- u.s. and netherlands and japan reached an agreement on the chips export control number. a lot of the chips manufacturing
1:44 pm
happens in japan and south korea and taiwan as well but the netherlands when it comes to the dutch semiconductor equipment maker asml, really taking a hit when it comes to export controls. that's good news for the chip sector. stick with us as we track all of it next. this is bloomberg. ♪ the first time you made a sale online was also the first time you heard of a town named... dinosaur? we just got an order from a dinosaur, colorado. start an easy to build, powerful website for free with a partner that always puts you first. godaddy. tools and support for every small business first.
1:45 pm
♪ we all have a purpose in life - a “why.” maybe it's perfecting that special place that you want to keep in the family or passing down the family business or giving back to the places that inspire you. no matter your purpose, at pnc private bank, we will work with you every step of the way to help you achieve it. so let us focus on the how. just tell us - what's your why?
1:46 pm
(upbeat music) there's more to business than the business you're in. (robot whirring) want smarter factories? that's the internet of things business. accelerating r and d? data science business. hey. have a look. managing global supply chains? shrink our carbon footprint business. thank you. (in foreign language) that's where deloitte comes in. with a potent blend of acumen and technology to help advance and connect all that it takes to excel in business ... to the business i'm in. deloitte.
1:47 pm
jon: this is bloomberg markets. we have been watching these developments tied toadani group with shares under pressure again. this comes after the short
1:48 pm
seller published a report accusing the firm of raising market manipulation and accounting fraud and even bill ackman weyden calling the report highly credible. joining us for more on these developments s isonali bassek. it's tied to how this empire has been formed. sonali: you guys have been smart to cover the nature of this. you have the wealth of adani himself which has been wiped out to the tune of $20 million in a day and more than that over a couple of days. there are the companies tied to him as well some of which have hit their limits. when you looked at the selloff in the last 24 hours in the last couple of days, we've seen some of the contagion spread to broader markets. you look at the hindenburg --
1:49 pm
hindenburg report and you have the empire fighting back against this report. it's important to notice that this is a legal battle that will ensue between the two parties. bill ackman says there are other issues you have to look through despite that report. things like credit sites drawing concerns about leveraged tied to the empire and analysts we have cited have concerns about the overconcentration when you look at the economy and the stocks tied to the market and how much leverage is embedded in the system and the concentration among certain billionaire empires. this is not just because of how large this empire is and you can see how big the drop as been. for days, it's been one of the top stories on the bloomberg terminal. you can see he is still among the top billionaires in the world.
1:50 pm
we will update the barometer at the end of the day today but right now, it looks like as well would have dropped from over $100 billion to about $90 billion. kriti: it's crucial to talk to our global audience about what this company does. talking about things like power, green energy and gas and it has a real estate company and i believe a food company in singapore as well which is a strange side business. when you look at what the empire does, you can take the entire indian stock market. why did hindenburg research become such a game changer? sonali: it's because the allegations are much more scathing than what you saw over credit sites where you talk about a concern about leverage. when you look at the leverage
1:51 pm
issue across the american economy, this was an issue in more developed markets like the u.k. economy. when you look at the hindenburg report, it is a much more targeted group of companies and it goes much deeper into its concerns. it is drawing concern about the valuation i you could consider systemic costs across the global economy to something very specific to one of the wealthiest individuals. jon: you made the point earlier of highlighting adani's position and the denials but we started this segment by referencing on wall street bill ackman weighing in. back to his big call on herbalife which many people have been referencing as well. sonali: i think it's
1:52 pm
interesting, herbalife, it was interesting to hear that they were pretty scathing fight that lasted many years. it can show you that a fight like this especially the way hindenburg is fighting back as well could last a while. this is one of the world's wealthiest people with a massive empire and many companies, much bigger than herbalife. when you look at what bill ackman is saying, for the first time in a long time, as the economy gets to a place that's much more tenuous, you might see a lot more like this out there across the market. people targeting individual companies, people look at accounting practices in the biggest difference is not just the scale, is also the fact that we are broadening outside american markets because the world has gotten more global since herbalife. jon: thanks very much and to consider. we will watch the adani story
1:53 pm
and the story in the u.k. where there are no tax cuts coming especially when it comes to addressing green subsidies. that's the message from the chancellor of the exchequer, jeremy hunt in an exclusive bloomberg interview. find out more next. this is bloomberg. ♪
1:54 pm
1:55 pm
jon: this is bloomberg markets. time for today's for what it's worth. our number today is $400 billion , roughly how much the has earmarked for subsidies under the inflation reduction act. it signals a priority for green investments, it creates competitive threats for other nations like the u.k. the chancellor of the exchequer pushing back against the idea of green energy subsidies in an exclusive interview with bloomberg. >> we think that if we are going to have the transition to net
1:56 pm
zero, we should benefit from free and open trade between all the countries that share that ambition. i don't think subsidy is necessarily the best way. people want to create innovation and ideas in a regulatory structure that encourages investment. jon: the view there from jeremy hunt. we've heard this from other nations and competitive threats even in canada. kriti: jeremy hunt told rishi sunak of the u.k. that inflation is not falling as quickly as hoped. they want to get 5% and they say it will be tough you are seeing friction in the u.k. which is dealing with one of the worst inflation crises and cost-of-living crisis in all of europe and all the g10 countries. we will keep a close eye on that so let's check on the markets. the s&p 500 is higher by 0.4% and the nasdaq is up as well.
1:57 pm
we will walk you through the closing bell today and it's an interesting market session to close out the week. this is bloomberg. ♪ like changing tax rates, exemption certificates or filing returns. avalarahhh ahhh ahhh ahhh
1:58 pm
- [announcer] imagine having fuller, thicker, more voluminous hair instantly. all it takes is just one session at hairclub.
1:59 pm
introducing xtrands. xtrands adds hundreds or even thousands of hair strands to your existing hair at the root. they're personalized to match your own natural hair color and texture, so they'll blend right in for a natural, effortless look. call in the next five minutes and when you buy 500 strands, you get 500 strands free. call right now. (upbeat music)
2:00 pm
>> counting you down to the close. we have two hours left. i am kailey leinz alongside kriti gupta. the s&p 500 higher by 0.4% but not the same for the semiconductors. intel heading for the worst day since 2020. the stock down about 7% and outside of equity world in the bond market, we also got economic data. the 10 year yield up to 3.25%. kriti:


info Stream Only

Uploaded by TV Archive on