Speaker 1: By from the Bloomberg Interactive Brokers Studios. This is Bloomberg
Speaker 1: day Break for Friday, December nine two. Coming up this hour,
Speaker 1: Wall Street graces for the first of two inflation reports
Speaker 1: before next week SPED meeting. Janet Yellen holds fast to
Speaker 1: her fall that the US will avoid recession. A vocal
Speaker 1: bear doubles down on his bearish call for stops and
Speaker 1: Sam Bankman freed miss is a key deadline set by
Speaker 1: US lawmakers. Advocates urge and judge to stop New York
Speaker 1: mayor Adams from forcing homeless people into mental health treatment,
Speaker 1: plus a call for new sanctions on Russia and China.
Speaker 1: Michael bar More Ahead. I'm John Stashower in sports the
Speaker 1: Mets that resigned Grand and Nemo, and they'll play two
Speaker 1: quarterfinal matches today at the World Come. That's all s
Speaker 1: train ahead on Bloomberg Daybreak on Bloomberg eleven, Free on
Speaker 1: New York, Bloomberg N one, Washington, d C, Bloomberg one
Speaker 1: oh six one, Boston, Bloomberg nine sixties and Francisco Sirius
Speaker 1: x M one nineteen and around the world Old on
Speaker 1: Bloomberg Radio dot Commen via the Bloomberg Business Friday morning.
Speaker 1: I'm Amy Morris, I'm Nathan Hagar. Futures are just a
Speaker 1: bit higher this morning. It's five old one on Wall Street.
Speaker 1: We checked the markets all day long at bloomberg S
Speaker 1: and P futures are up seven points down, futures up
Speaker 1: twenty four. Nastaic futures are higher by thirty two points ten.
Speaker 1: Your treasury is down one thirty second. The yield three
Speaker 1: point eight percent. Yield on the two year four point
Speaker 1: to eight percent. Nimex screws up one point four percent,
Speaker 1: or dollar one at seventy two forty eight cents a barrel,
Speaker 1: Amy Nathan, we start this morning with the u S Economy.
Speaker 1: Wall Street closes out the week with a pair of
Speaker 1: key economic reports, November's Producer Price Index and the University
Speaker 1: of Michigan Consumer Sentiment Index. Bloomberg's Michael McKee brings us
Speaker 1: a preview. We're into a world of base effects with
Speaker 1: the November Producer Price Index. Because inflation was higher a
Speaker 1: year ago. The annual rate of wholesale inflation can fall
Speaker 1: even if the monthly rate increases, and that's the expectation
Speaker 1: arise in both headline and core inflation for the month.
Speaker 1: But a dropped to the lowest annual headline inflation since
Speaker 1: May of last year, and had dropping the core to
Speaker 1: the lowest since June. That might contribute to an expected
Speaker 1: rise in the University of Michigan's preliminary consumer Sentiment Index,
Speaker 1: a small rise but still at a depressed level. Investors
Speaker 1: will be more interested in the surveys inflation expectations indexes.
Speaker 1: Neither one year or five year expectations are expected to
Speaker 1: change as Americans wait for proof prices are slowing rather
Speaker 1: than forecasts. Michael McKee, Bloomberg Daybreak, All right, Mike, thanks so.
Speaker 1: Calls for a recession are growing, but Treasury Secretary Janet
Speaker 1: Yellen says she still anticipates the US economy will avoid one.
Speaker 1: We get the story from Bloomberg's Charlie Pallace. During a
Speaker 1: visit to Fort Worth, Texas. Yellen said, quote, whether or
Speaker 1: not we can avoid a recession, I believe the answer
Speaker 1: is yes. She highlighted the US pay rolls so far
Speaker 1: have avoided declines. On inflation, she said, supply chain bottlenecks
Speaker 1: are clearly beginning to ease, and that's helpful. In New York,
Speaker 1: Charlie Pellett Bloomberg Daybreak. Thank you, Charlie. Still much of
Speaker 1: Wall Street disagrees with Secretary Yell, and, including the man
Speaker 1: who manages one of the biggest pension funds in the country.
Speaker 1: We caught up with Chris Aleman, the chief investment officer
Speaker 1: of the California State Teachers Retirement System. I feel like
Speaker 1: a recession has to happen because in my lifetime, when
Speaker 1: the FED raises rates this aggressively seventy five time and
Speaker 1: time after again, the economy slows down. The inflation is
Speaker 1: from the supply chain disruptions and the war. Maybe inflation
Speaker 1: slows down on its own. I'd be surprised that I
Speaker 1: think we've gotta have a recession. Chris Aleman overseas about
Speaker 1: three billion dollars at the California State Teachers Retirement System. Well,
Speaker 1: despite calls for a recession, amy, some of the world's
Speaker 1: biggest investors predict stocks will see low double digit gains
Speaker 1: next year. Of respondence to a Bloomberg survey, expect equities
Speaker 1: to rise that compares with forecasting declines. For those seeing gains,
Speaker 1: the average prediction was a ten percent return, and Nathan
Speaker 1: the S and P five is up about ten percent
Speaker 1: from its October lows. One of the market's most vocal
Speaker 1: skeptics sees more losses ahead. We spoke with Morgan Stanley
Speaker 1: chief US equity strategist Mike Wilson. We don't think that
Speaker 1: this bear market is over yet, mainly because our forecast
Speaker 1: for next year on earnings is materially below the street. Now,
Speaker 1: I know that's becoming a bit of a consensus view,
Speaker 1: but I think our forecasts are even below, uh, you know,
Speaker 1: kind of this new level that people are talking about.
Speaker 1: Morgan Stanley chief US equity strategist Mike Wilson says there's
Speaker 1: still a case for positioning in defensive value stocks like utilities, staples,
Speaker 1: and healthcare sectors, but not in industrials, financials, and energy.
Speaker 1: Here more of our conversation with Wilson just a little
Speaker 1: later in the program. Well, in the meantime, Mayby, let's
Speaker 1: take a look at some of the stocks on the
Speaker 1: move this morning. Shares of Lulu lemon Or down more
Speaker 1: than seven per sent. Gross margins at the Yoga Wearemaker
Speaker 1: came in below estimates. Shares of broadcom Er up three percent.
Speaker 1: Chipmaker gave an upbeat sales forecast, indicating demand remains strong
Speaker 1: and shares of Docusenter hired by eleven percent. The company
Speaker 1: boosted its revenue guidance for the full year. New developments
Speaker 1: this morning, Nathan in the collapse of cryptocurrency Exchange f
Speaker 1: t X, Sam Bankman Freed has missed a key deadline
Speaker 1: set by a Senate committee. Let's get the latest now
Speaker 1: Live with Bloomberg. Steve Rappaport, Good morning, Steve, Good morning, Amy,
Speaker 1: and Nathan. Bankman Freed had until five pm yesterday to
Speaker 1: respond to a letter requesting he appeared before a Senate
Speaker 1: Banking committee next week. Chairman Shared Brown warning he and
Speaker 1: ranking member pat to Me are prepared to issue with
Speaker 1: subpoena if Bankman Freed does not comply. Bankman Freed recently
Speaker 1: indicated he would testify before a House committee. It's unclear
Speaker 1: why he didn't respond to the Senate panel's request, though
Speaker 1: a spokesman for the disgraced ft X founder confirms he
Speaker 1: hired a defense attorney. Bankman Freed admits to a series
Speaker 1: of business blunders, but denies to frauding anyone. Live in
Speaker 1: New York. I'm Steve Rappaport, Bloomberg Daybreak. Okay, Steve thank you.
Speaker 1: Now to the latest on Brittany Grinder. The w NBA
Speaker 1: star was expected to land in San Antonio, Texas, from
Speaker 1: Russia overnight, hours after the US traded a notorious arms
Speaker 1: dealer for her release. Republicans are criticizing the prisoners swap.
Speaker 1: They call Grinder a geopolitical pawn. Democratic Congresswoman Sheila Jackson
Speaker 1: Lee represents Grinder's hometown of Houston. No American should be
Speaker 1: left without knowing that the full power of the United
Speaker 1: States will be behind them to bring them home. Texas
Speaker 1: Congresswoman Sheila Jackson Lee says Grinder's release sends a message
Speaker 1: and puts a renewed spotlight on retired Marine Paul Wheeland,
Speaker 1: who is still being held in Russia. SMB futures are
Speaker 1: up eight points. Staff futures up thirty five, so are
Speaker 1: NASDAC futures again of thirty five points on the Tech
Speaker 1: Heavy Futures Index. To tend your treasury is down one
Speaker 1: thirty second the yield three point for eight percent. Straight
Speaker 1: ahead your latest local headlines and a check of sports.
Speaker 1: This is Bloomberg making Nathan five oh seven on Wall
Speaker 1: Street thirty eight degrees in New York plenty of sunshine.
Speaker 1: To get your weekend started. We'll get up to forty
Speaker 1: five degrees today. Let's bring in Michael bar with more
Speaker 1: on what else is going on in New York and
Speaker 1: around the world. Good morning, Michael, Good morning Amy. Advocates
Speaker 1: for people with mental illness are urging a federal judge
Speaker 1: to stop New York City Mayor Eric Adams plan to
Speaker 1: force people from the streets and into mental health treatment.
Speaker 1: Several organizations, including the New York Lawyers for the Public
Speaker 1: Interest and the National Alliance on Mental Illness of New
Speaker 1: York City, said action was needed to stop large skill
Speaker 1: in voluntary hospitalizations. The lawsuits seeks to remove police officers
Speaker 1: as first responders for those requiring healthcare. When announcing the
Speaker 1: plan on November twenty nine, Adams called it a moral
Speaker 1: obligation to act. The US is preparing new sanctions on
Speaker 1: Russia and China for what it describes as human and
Speaker 1: the rights abuses by both countries, according to officials familiar
Speaker 1: with the matter. The European Union is set to boost
Speaker 1: the size of a fund finance weapons for Ukraine by
Speaker 1: at least two point one billion dollars as early as
Speaker 1: next week. Congress took a historic step to protect marriage equality,
Speaker 1: The House passed bipartisan legislations amending federal protections for same
Speaker 1: sex and interracial couples. Senate Majority Leader Chuck Schumer says
Speaker 1: this bill is personal for him, as his daughter and
Speaker 1: her wife are expecting their first child. Thanks to the
Speaker 1: tireless advocacy of many many in this room and the
Speaker 1: dogged work by many of my colleagues, my grandchild will
Speaker 1: live in a world that will respect and honor their
Speaker 1: mother's marriage. Republicans against the bill have claimed that it
Speaker 1: goes against religious freedom. NASA's Artemis Moon mission is headed
Speaker 1: toward a Sunday splash down in the Pacifics. But first
Speaker 1: the Orion spacecraft has to survive about twenty five thousand
Speaker 1: mile per hour five thousand degree re entry. Should manage
Speaker 1: your Mike Seraphant, On entry day, we will realize our
Speaker 1: Priority one objective, which is to um demonstrate the vehicle
Speaker 1: a lunar re entry conditions, as well as our Priority
Speaker 1: three objective, which is to retreat the spacecraft. NASA's Mike
Speaker 1: Seraphant says a safe reentry will help certify the spacecraft
Speaker 1: as being safe for humans. NASA hopes to fly it
Speaker 1: around the moon with an astronaut crew. In a couple
Speaker 1: of years. Global News twenty four hours a day on
Speaker 1: air and on Bloomberg Quick Take, powered by more than
Speaker 1: twenty seven hundred journalists and analysts and more than a
Speaker 1: hundred twenty countries. Michael Barr and this is Bloomberg. Any,
Speaker 1: all right, thank you, Michael. It's five ten on Wall Street.
Speaker 1: Time now for the Sports Report, brought to you by
Speaker 1: try Steed out at Here's John stash Our. All right,
Speaker 1: Amy in. The Mets drafted Brandon Nemo in the first
Speaker 1: roundback in two thousand and eleven. He's developed into a
Speaker 1: solid center field and both at the plate and in
Speaker 1: the field than the Mets are keeping them oh an
Speaker 1: eight year deal for a hundred and sixty two million dollars,
Speaker 1: which means the Mets payroll ine is likely to be
Speaker 1: around three hundred and twenty million, far and away the
Speaker 1: most in baseball history. Mets have also signed veteran reliever
Speaker 1: David robertson what a few days for Baker Mayfield. Once
Speaker 1: the first pick of the draft, he was the Week
Speaker 1: one starter for Carolina, released Monday by the Panthers, claimed
Speaker 1: on waivers Tuesday by the Rams. Mayfield had one practice
Speaker 1: with his new team and then played the entire game
Speaker 1: last night, and through a game winning touchdown passed with
Speaker 1: ten seconds left, the Rams ended a six game losing
Speaker 1: streak seventeen sixteen over the Raiders. Giants winless in their
Speaker 1: last three games, and Sunday incomes Philadelphia at eleven and one,
Speaker 1: five and oh on the road and led by quarterback
Speaker 1: Jalen Hurts. Five years ago, Hurts led Alabama to the
Speaker 1: National Championship. Giants coach Briant Dayball was then the Obama
Speaker 1: offensive coordinator. UM tremendous person first and foremost, holly competitive,
Speaker 1: extremely smart, great leaders, the reason why he's probably at
Speaker 1: the top of list for m VP right now. The
Speaker 1: Jets Sunday visit Buffalo looking for a season sweet for
Speaker 1: the Pills World Cup quarterfinals begin this morning with Brazil
Speaker 1: against Croatia. Later the Netherlands off the wind over the
Speaker 1: U S taking on Argentina, nix Er and Charlotte Tonight
Speaker 1: there without Obie Topp and he's gonna miss two or
Speaker 1: three weeks with a knee injury. Netsos Atlanta Rangers visit
Speaker 1: Colorado on the Islanders tonight take on the devil. John
Speaker 1: Stashower Bloomberg S Court team. All right, thank you, John D.
Speaker 1: Bloomberg Sports Report was brought to you by Audie. Don't
Speaker 1: let someone else drive off in the Audi model you've
Speaker 1: always wanted. Visit your local try state Audie dealer to
Speaker 1: get behind the wheel of yours today, or visit Autie
Speaker 1: Offers dot com for more information. It's five eleven on
Speaker 1: Wall Street. Coming up on Bloomberg Daybreak. We'll hear from
Speaker 1: former Secretary of Homeland Security J. Johnson. Ahead of that conversation.
Speaker 1: S and P futures ten points higher, DELF futures up
Speaker 1: forty NASTAC futures up thirty nine points. By twelve on
Speaker 1: Wall Street, this is Bloomberg Daybreak. Let's turn the conversation out.
Speaker 1: Britney Griner, the w NBA star, was released from detention
Speaker 1: in Russia and a swap for a notorious arms dealer
Speaker 1: who had been convicted and imprisoned in the United States.
Speaker 1: Victor Boot is known as the quote Merchant of Death.
Speaker 1: His release is being criticized by the President's opponents. Now
Speaker 1: for more on this situation, plus the broader geopolitical and
Speaker 1: national security landscape. Bloomberg's David David Weston spoke with former
Speaker 1: Secretary of Homeland Security J. Johnson. Let's listen in on
Speaker 1: that conversation now, Mr Secretary, thank you so much for
Speaker 1: being back with us. You've dealt with, if not specifically,
Speaker 1: this sort of thing, things like this. How did they
Speaker 1: come about? We're told actually it was actually the intelligence
Speaker 1: agencies that worked this out rather than it being done
Speaker 1: through the White House. Well, David, it's when when I
Speaker 1: was General Counsel of the Department of Defense, I was
Speaker 1: frequently involved, usually on the margins in UH, discussions over
Speaker 1: releases of Guantanamo detainees six changes. UH. Sometimes these are
Speaker 1: often conducted through the State Department, could be conducted to
Speaker 1: the Defense Department. We're hearing the intelligence community here. And
Speaker 1: the thing to remember about these types of situations this
Speaker 1: is and many people will second guess exchanging Brittany Grinder
Speaker 1: for a hardened, dangerous arms dealer who's in jail for
Speaker 1: a long time, who was lawfully and rightly convicted of something.
Speaker 1: It's not like a business deal where you can say, no,
Speaker 1: this company is not worth five million, it's worth four nillion.
Speaker 1: You have to deal with the cards, you're you're dealt.
Speaker 1: And we we have an American citizen who was imprisoned
Speaker 1: for a period of nine years for something that wouldn't
Speaker 1: even be a crime in the United States. Should we
Speaker 1: hold against her the fact that the person on the
Speaker 1: other side of the equation was rightfully convicted for something
Speaker 1: very dangerous. I say no. And there are many considerations
Speaker 1: for policy considerations, national security considerations. It's a multidimensional context.
Speaker 1: So it's difficult to second guess this. And I Americans,
Speaker 1: specifically in members of Congress, I should hesitate two second
Speaker 1: guests this type of diplomacy. Here we have some Republicans
Speaker 1: right now already second guessing at the same time as
Speaker 1: is this a matter of national security or humanitarian concerns?
Speaker 1: Because as you said, Mr boot was convicted if selling
Speaker 1: arms to kill Americans in Colombia actually for the insurrection
Speaker 1: is down there. Uh, and so he was a danger
Speaker 1: for a national security Uh. Does this advance the national
Speaker 1: security and states? Or do we say, you know, as
Speaker 1: a country, I'm sorry, we care about our people. We're
Speaker 1: gonna bring them home, no matter what I would say, David,
Speaker 1: all of the above. Um, Russia, of course is in
Speaker 1: the midst of it's a legal war in Ukraine. Uh
Speaker 1: in how we view that situation from the national security perspective,
Speaker 1: The fact that the Russians have Brittany Grinder is no
Speaker 1: longer part of that equation, so in that respect it
Speaker 1: enhances our national security picture. Should we anticipate even the
Speaker 1: possibility that these discussions that happened with the Russians, whether
Speaker 1: through the UAU otherwise, could lead to other discussions that
Speaker 1: might get people to the bargaining table with the type
Speaker 1: of Ukraine I certainly hope so. President Biden has said
Speaker 1: that he would be willing to talk to Vladimir Putin
Speaker 1: under certain conditions. Perhaps this is some form of pathway,
Speaker 1: though the personalities involved in this discussion may be wholly
Speaker 1: different from the personalities involved in the Russian government with
Speaker 1: other types of discussions. We just don't know. How concerned
Speaker 1: should we be about the use of drones to attack
Speaker 1: Russian bases inside of Russia by Ukraine. I think in
Speaker 1: the United States has been clear we did not supply
Speaker 1: the armament to get that done. At the same time,
Speaker 1: I'm not sure we're really discouraging Ukraine from doing it.
Speaker 1: Is this a really tricky part because you have Laderman Putin,
Speaker 1: the president of Russian now starting talking again about nclear weapons.
Speaker 1: This was never going to be a technology that we
Speaker 1: could monopolize here in the United States. It's about and
Speaker 1: it happened that others would have armed drones for use
Speaker 1: in in in conflict. Um. From my legal perspective, we
Speaker 1: have to take extra care that armed drones are used
Speaker 1: in conformity with the laws of armed conflict. It's playing
Speaker 1: that Putin doesn't play by those roles, but Ukraine should.
Speaker 1: And so if there's a lawful military objective and it
Speaker 1: can be achieved through minimal collateral damage through an arm drone,
Speaker 1: I would say it's perfectly acceptable. Let's turn, if you could,
Speaker 1: to national security and homeland security in particular that you
Speaker 1: were responsible for. We hear about various threats the United States,
Speaker 1: most recently actually on power stations, substations in North Carolina.
Speaker 1: They got shot up and took the power down to
Speaker 1: something like Americans, how vulnerable are we? And particularly with
Speaker 1: respect to the power structure. Power grid is considered critical infrastructure.
Speaker 1: It's one of the sixteen sectors of critical infrastructure in
Speaker 1: this country. This physical kinnectic attack on the two substations
Speaker 1: demonstrates a vulnerability. UM, I don't know that we can
Speaker 1: have twenty four seven armed guards around every substation in America.
Speaker 1: The key has to be redundancy. It shouldn't be the
Speaker 1: case that an attack with apparently rifles on two sub
Speaker 1: stations takes out as many as seventy five thousand households,
Speaker 1: or I even heard the number one hundred thousand initially.
Speaker 1: Redundancy have to be has to be the key. That's
Speaker 1: former Homeland Security Secretary j Johnson speaking with Bloomberg's David
Speaker 1: Weston on Balance of Power. You can catch that program
Speaker 1: weekdays at noon Eastern on Bloomberg Radio and television. Futures
Speaker 1: are higher s and P up ten points, DAL up
Speaker 1: thirty four, NAZZAC features up thirty seven points still ahead
Speaker 1: on Bloomberg daybreak Wheel, check the markets and bring you
Speaker 1: the latest news in business, economics and finance. Stay with
Speaker 1: us on this Friday morning. This is Bloomberg Markets, headlines
Speaker 1: and breaking news twenty four hours a day at Bloomberg
Speaker 1: dot Com, the Bloomberg Business at and at Bloomberg Quick Tape.
Speaker 1: He's a Bloomberg Business Black Nathan Hagar. Futures are on
Speaker 1: the rise ahead of a report on US producer prices
Speaker 1: that will be one of the final pieces of data
Speaker 1: that will inform a rate decision by the Federal Reserve
Speaker 1: next week. We check the markets all day long on Bloomberg.
Speaker 1: SMP futures right now have nine points about a quarter
Speaker 1: percent down, futures up thirty eight. Nanstack futures are higher
Speaker 1: by thirty nine points ten. Your treasury is up one
Speaker 1: thirty second. The yell three point four seven percent. You'ld
Speaker 1: on the two year four point to seven percent. Nim
Speaker 1: X screwed is up eight tenths per cent, or fifty
Speaker 1: seven cents at seventy two dollars five cents of barrel
Speaker 1: comics gold is up two tenths per cent or three
Speaker 1: dollars ninety cents at eighteen o five fifty an ounce.
Speaker 1: The Euro one point zero five six one against the
Speaker 1: dollar British pound one point two to five one. The
Speaker 1: end is at one thirty six point zero nine. Bitcoin
Speaker 1: is hired by two tenths per cent, trading around seventeen thousand,
Speaker 1: two hundred dollars. That's a Bloomberg business flash. Now here's
Speaker 1: Michael Barr with more on what's going on around the world. Michael,
Speaker 1: thank you very much. Nathan. Federal prosecutors will Alaska judge
Speaker 1: today to hold former President Trump's lawyers in contempt. The
Speaker 1: Justice Department claims the attorneys have failed to fully comply
Speaker 1: with a subpoena that requires the return of all classified
Speaker 1: documents Trump might be holding. W NBA star Britney Griner
Speaker 1: is arriving in San Antonio, Texas after a prisoners swap
Speaker 1: with Russia. Ryan was arrested in February for llegally bringing
Speaker 1: hash oil in vape cartridges into Russia. Now the US
Speaker 1: is trying to get American Paul Wheeland freed from Russian custody.
Speaker 1: Thursday Night football, the Rams beat the Raiders in a
Speaker 1: close one seventeen sixteen FIFA World Cup action resumes today.
Speaker 1: Croatia plays Brazil and the Netherlands faces Argentina. Global News
Speaker 1: twenty four hours a day on air and on Bloomberg Quicktake,
Speaker 1: powered by more than twenty seven hundred journalists and analysts
Speaker 1: and more than one countries. I'm Michael Barr, and this
Speaker 1: is Bloomberg Gaming. All right, thank you, Michael. It is
Speaker 1: five on Wall Street. I'm Amy Morris and this is
Speaker 1: Bloomberg Daybreak. Let's get back to the markets again. Now
Speaker 1: with the latest call on stocks, one of the most
Speaker 1: accurate forecasters on Wall Street is turning bearish again. Morgan
Speaker 1: Stanley chief US equity strategist Mike Wilson says he does
Speaker 1: not think the bear market is over yet. He spoke
Speaker 1: with Bloomberg's Romane Bostick and Katie Greifeld. Let's listen in.
Speaker 1: We don't think that this bear market is over yet,
Speaker 1: mainly because our forecast for next year on earnings is
Speaker 1: materially below the street. Now, I know that's becoming a
Speaker 1: bit of a consensus view, but I think our forecasts
Speaker 1: are even below, you know, kind of this new level
Speaker 1: that people are talking about. So we're a hundred dollars
Speaker 1: for SMP earnings next year with a downward bias, and
Speaker 1: it couldn't get worse than that. And if that we've
Speaker 1: really been talking about, Romain, is this idea around operating leverage,
Speaker 1: how it's now working against companies and inflation coming down
Speaker 1: is actually good for bonds and good for yields to
Speaker 1: come down, but it's not good for profits because it
Speaker 1: squeezes margins. Though, I mean, I'm just doing the quick
Speaker 1: back at the envelope math, I mean, where does that
Speaker 1: take valuations from where we are today. I would assume
Speaker 1: there still has to be a pretty significant drop that
Speaker 1: would actually bring us down to something commensurate and with
Speaker 1: a D that's exactly right. So, you know, we made
Speaker 1: that tactical bullish call. You know, it was kind of okay,
Speaker 1: we're getting closer. It's it's a decent level to be
Speaker 1: taking a swing here, but now back close to fourth housand,
Speaker 1: you know, we're talking about twenty times earnings again, and
Speaker 1: that's just the wrong price. Even if the FED pauses
Speaker 1: you know, rate hikes. You know, rate levels are much
Speaker 1: higher than where they were, you know, a year or
Speaker 1: two ago. So it's really difficult to argue for twenty
Speaker 1: times being the right multiple. What is the right multiple.
Speaker 1: It's probably closer to something like sixteen times. And that's
Speaker 1: why we think we can make new loads sometime in
Speaker 1: the first half of next year. And like to the
Speaker 1: point that inflation cooling actually peaking would be bad for stocks,
Speaker 1: good for bonds. You said something last week that I've
Speaker 1: been thinking about since you said that you want to
Speaker 1: be in cash first, then you want to buy treasuries,
Speaker 1: then credit, and buy equities. Last. Where are we on
Speaker 1: that time frame? Should we be buying duration here? That's
Speaker 1: exactly right. So we've been adding duration in our portfolio
Speaker 1: is really since the summer, probably a little earlier than
Speaker 1: we should have, but you know, we we we try
Speaker 1: to be a little bit ahead of the game. Um
Speaker 1: so yes, friend end cash. You know, short duration was
Speaker 1: the first place to go for safety because it was
Speaker 1: a bear market for bonds and stocks. But then bond
Speaker 1: the old reached an attractive level, we thought this summer,
Speaker 1: and of course we exceeded that. We get the four
Speaker 1: in a quarter on a tenure and now we've come
Speaker 1: back to three fifties. So it's obviously not as good
Speaker 1: a value as it was a month ago, but it's
Speaker 1: still a better place to be if we're going to
Speaker 1: be right about the earning cycle and then convestment. Great credit,
Speaker 1: you know, also offers a pretty good place to be
Speaker 1: as long as you're high, you know, on the credit
Speaker 1: quality side, and you're probably not. You know, five or
Speaker 1: seven years is kind of your duration there. And then yes,
Speaker 1: equities are last. Now within equities, you know, we've been
Speaker 1: positioned all year in sort of the defensive sectors, which
Speaker 1: are basically bond process right. That's why we've outperformed so
Speaker 1: much this year in our portfolios because we basically made
Speaker 1: that shift. Even within our equity books. You can be defensive,
Speaker 1: and that's what the market likes right now. And that's
Speaker 1: Morgan Stanley, t f US equity strategist Mike Wilson speaking
Speaker 1: with Bloomberg's Romain Bostick and Katie Greifeld. You can hear
Speaker 1: more of that interview online at Bloomberg dot com and
Speaker 1: on the Bloomberg terminal. Bloomberg Daybreak is brought to you
Speaker 1: by s e I imagine your asset management firms operational
Speaker 1: infrastructure as a competitive advantage. Let s e I show
Speaker 1: you how at s e I C dot com slash
Speaker 1: I M s now. Let's take a look at today's
Speaker 1: a Bloomberg weather forecast and what's in store for the
Speaker 1: weekend with Bloomberg Meteorologist Rob Caroline. We'll conclude the work
Speaker 1: week with sunshine. We have high pressure and control that
Speaker 1: leads the temperatures climbing up to about forty five this afternoon,
Speaker 1: so definitely cooler over yesterday. Clear tonight thirty to thirty
Speaker 1: five twenties in the suburbs. It will be partly sunny
Speaker 1: at times Tomorrow forty forty five claudy. On Sunday, there's
Speaker 1: a chance of afternoon showers highst five and a few
Speaker 1: spots may see those showers mixed with wet snow Sunday evening.
Speaker 1: I'm Rob Caroline with your three day forecast on Bloomberg
Speaker 1: eleven three oh broadcasting live from the Bloomberg Interacted Broker's
Speaker 1: studio in New York. Bloomberg e Living Free to Washington,
Speaker 1: d C. Bloomberg On to Boston, Bloomberg one oh six,
Speaker 1: What does San Francisco? Bloomberg sixty to the country, Sirius
Speaker 1: XM H one nine and around the globe, the Bloomberg
Speaker 1: Business app and Bloomberg Radio dot Com. This is Bloomberg Daybreak.
Speaker 1: It's coming up on five thirty on Wall Street. Good
Speaker 1: Friday morning. I'm Any Morris and I'm Nathan Hagar. We're
Speaker 1: nearly four hours away from the open of US trading.
Speaker 1: Let's get you up to date on the news you
Speaker 1: need to know at this hour. Futures are moving higher
Speaker 1: ahead of today's inflation data. The Producer Price Index will
Speaker 1: be one of the final readings before next week's FED decision.
Speaker 1: Let's get a preview from Bloomberg'svinny del Judas. November's producer
Speaker 1: price and dex rose eight percent year over a year,
Speaker 1: the smallest increase since June one. Money that is still
Speaker 1: well above the federal reserves overall inflation target. What's going on?
Speaker 1: Bloombrig Economics notes goods prices are moderating as domestic and
Speaker 1: global demand slow and supply chain glazes. The strong dollar
Speaker 1: is also an issue. Next week we get data on
Speaker 1: November consumer prices. Any Bell Judai s Bloombergday Break, All right, Vinny,
Speaker 1: thank you. That producer price data comes out at eight
Speaker 1: thirty am Wall Street time, followed by University of Michigan
Speaker 1: sentiment ninety minutes later, and Nathan Despike calls for recession.
Speaker 1: Some of the biggest investors predict stocks will see gains
Speaker 1: next year. Seventy of respondents in a Bloomberg survey expact
Speaker 1: to equities to RYE that compares with forecasting declines now.
Speaker 1: One of those forecasting declines is Morgan Stanley Chief investment
Speaker 1: officer Mike Wilson. He has turned barish again, saying value
Speaker 1: stocks are a risk, so I don't think there's as
Speaker 1: much of a distinction between value and growth at this
Speaker 1: stage of the economic cycle, unless you're talking about the
Speaker 1: defensive parts of value. Morgan Stanley Chief Investment Officer Mike
Speaker 1: Wilson expects the SMP five hundred to resume declines relatively
Speaker 1: soon and new developments this morning. In the collapse of
Speaker 1: cryptocurrency exchange f t X, Sam Bankman Freed has missed
Speaker 1: a key deadline set by a Senate committee. Let's get
Speaker 1: the latest live with Bloomberg's Steve Rappaport. Good Morning, Steed,
Speaker 1: Good morning Amy, and Nathan. Sam Bankman Freed faces the
Speaker 1: possibility of a subpoena after he failed to respond to
Speaker 1: a request to appear before a Senate panel next week.
Speaker 1: Lawmakers are demanding an explanation for the implosion of f
Speaker 1: t X. Bankman Freed indicated he would testify before a
Speaker 1: House committee. It's unclear why he's remaining silent on this one,
Speaker 1: though the ft X founder recently retained a defense attorney.
Speaker 1: Live in New York, I'm Steve Rappaport, Bloomberg Daybreak. Okay, Steve,
Speaker 1: thank you, and w NBA Star Britney Grinders on our
Speaker 1: way home to Texas after a prisoner swap with Russia.
Speaker 1: Her releases put a renewed spotlight on retired Marine Paul Whelan,
Speaker 1: who is still imprisoned in Russia. White House Press Secretary
Speaker 1: Karine Jean Pierre says negotiations for Wheeland's release are ongoing,
Speaker 1: but Russia won't budge. We did not want to lose
Speaker 1: the opportunity before us to secure the release of one
Speaker 1: of them, and so that was the choice, one or none,
Speaker 1: Karine Jean Pierre. The White House says they are still
Speaker 1: working to secure Wheeland's release. Right now, SMP futures are
Speaker 1: up ten points. Staff futures of forty six, NASTAC futures
Speaker 1: are hired by forty two points ten. Your treasury is
Speaker 1: up to thirty seconds. The three point four seven percent
Speaker 1: Nimex screws up eight tenths percent at seventy two oh
Speaker 1: six of Barrel, and comic Gold is up two tenths
Speaker 1: per cent, trading at eighteen o five twenty an ounce
Speaker 1: straight ahead your latest local headlines and the check of sports.
Speaker 1: This is Bloomberg. You Nathan five thirty one on Wall Street.
Speaker 1: Let's bring in Michael bar with more on what else
Speaker 1: is going on in New York and around the world.
Speaker 1: Good morning Michael, Good morning Amy. There's a call for
Speaker 1: a federal judge to stop a plan by New York
Speaker 1: City Mayor Eric Adams to force people from the streets
Speaker 1: and into mental health treatment. Advocates for people with mental
Speaker 1: illnesses saying that the policy dangerously permits the involuntary detention
Speaker 1: of individuals who seem to have a mental illness. The
Speaker 1: lawsuit seeks to remove police officers as first responders for
Speaker 1: those requiring healthcare. The Department of Justice is asking a
Speaker 1: federal judge to hold former President Trump's team in contempt
Speaker 1: over the Mara Lago case. The d o J says
Speaker 1: Trump's office failed to fully comply with a Maze subpoena
Speaker 1: to return all classified documents in his possession. The US
Speaker 1: is preparing new sanctions on Russia and China. It's for
Speaker 1: human rights abuses by both countries. The Respect for Marriage
Speaker 1: Act has passed the House and Senate. It will protect
Speaker 1: same sex and interracial marriages. It has bipartisan support, but
Speaker 1: Republican Representative Dan User of Pennsylvania says he chose not
Speaker 1: to support the revised version of the bill. I voted
Speaker 1: for it last time because it was very clear it
Speaker 1: was a vote for a protection of marriage. This one
Speaker 1: seems to be, in my view, more about an encroachment
Speaker 1: on religious organizations. President Biden plans to sign it soon.
Speaker 1: It's the home stretch for NASA's Artemis Moon mission. NASA
Speaker 1: Mission manager Mike Seraphant, the mission continues to proceed well
Speaker 1: and along the planned mission profile, and we are setting
Speaker 1: up for Earth re entry and splashed down in recovery
Speaker 1: of the Orion capsule following me skip re entry on
Speaker 1: December the eleventh. If it all goes well, NASA hopes
Speaker 1: to send a crew to fly around the Moon in
Speaker 1: a few years. Global needs twenty four hours a day
Speaker 1: on air and on Bloomberg Quicktake, powered by more than
Speaker 1: the seven hundred journalists analyists more than a hundred twenty countries.
Speaker 1: I'm Michael bar This is Bloomberg Andy. All right, thank you, Michael.
Speaker 1: Five thirty four on Wall Street. Time Now for the
Speaker 1: sports report, brought to you by Try State Autie. Here's
Speaker 1: Jon stash Allen. All right, thanks Amy. This is why
Speaker 1: Mets fans were so happy when Steve Cohen bought the
Speaker 1: team deep pockets. Mets already with the highest payroll added
Speaker 1: to it by keeping free agent center fielder Brandon Nemo
Speaker 1: an eight year contract for a hundred and sixty two
Speaker 1: million dollars. The Mets have also added veteran reliever David Robertson,
Speaker 1: had two stints with the Yankees with the Phillies. At
Speaker 1: the end of this past season, the l A Rams,
Speaker 1: having perhaps the worst season ever for defending Super Bowl champion,
Speaker 1: They were looking at a seventh straight loss. Trailed the
Speaker 1: Raiders by thirteen with under four minutes left, but Baker Mayfield,
Speaker 1: two days after being acquired by the Rams, led them
Speaker 1: on too long touchdown drives to a game winning TV
Speaker 1: pass with ten seconds left. The Rams won seventeen sixteen
Speaker 1: College Who's heartbreaking loss for Rutgers. Ohio State hit a
Speaker 1: three pointer with one second and left beat the Scarlet
Speaker 1: Knights sixty seven sixty six. He'll hand out the highs
Speaker 1: from trophy tomorrow in New York. The favorite is USC
Speaker 1: quarterback Tayleb Williams. Army Navy game is tomorrow in Philadelphia.
Speaker 1: Jason Garrett, fromer Cowboys coach former Giants assistant A finalist
Speaker 1: to be the new coach at Stanford World Cup. Down
Speaker 1: to the final A with one surprise team that's Morocco,
Speaker 1: never before a quarterfinal. Let's playing Portugal tomorrow ahead of
Speaker 1: the much anticipated England France game. Today it's Brazil against Croatia.
Speaker 1: Argentina takes on the Netherlands. Nicks just beat the Hawks.
Speaker 1: Nets just beat the Hornets tonight they reverse opponents. The
Speaker 1: Knicks are in Charlotte Manette's home threat Land. John Stashtward
Speaker 1: Bloomberg Sports Deny. All right, thank you, John D. Bloomberg
Speaker 1: Sports Report was brought to you by Audie. Don't let
Speaker 1: someone else drive off in the Audi model you've always wanted.
Speaker 1: Visit your local Tri State Audi dealer to get behind
Speaker 1: the wheel of yours today, or a visit Audi Offers
Speaker 1: dot com for more information. Futures are higher on this
Speaker 1: Friday as we start your weekend. It's five thirty six
Speaker 1: on Wall Street Time now for the Tri State Business
Speaker 1: Report with Bloomberg's Ed Corey. A new class action lawsuit
Speaker 1: involving emergency medical employees has been filed against New York City.
Speaker 1: It claims predominantly minority and female emergency medical service employees
Speaker 1: are less than the city's mostly white male firefighters, even
Speaker 1: though the two groups perform about the same work. Casinovia College,
Speaker 1: a small private school at Upstate New York, will close
Speaker 1: its doors at the end of the academic year, citing
Speaker 1: a financial squeeze from tumbling enrollment, unfavorable demographic trends, Inflation,
Speaker 1: and the pandemic hamper the school's finances. Staring interest rates
Speaker 1: also added to the challenges. Jeffrey Bank temporarily closed two
Speaker 1: restaurants in Times Square during the pandemic, but he signed
Speaker 1: a lease on another space nearby. Now, Cranes says he's
Speaker 1: debuting a new venue, Mermaid in Oyster Bar in Times Square,
Speaker 1: with restaurant power couple Cindy Smith and Danny Abrams at
Speaker 1: your Blomberg Dry State Business Report. I'm ed Corey. Thank you.
Speaker 1: Add It's five seven on Wall Street. The following is
Speaker 1: an editorial from Bloomberg Opinion. This editorial was written by
Speaker 1: the Bloomberg Editorial Board. Former President Donald Trump hasn't managed
Speaker 1: to criticize comments made by his recent private dinner guest,
Speaker 1: the rapper formerly known as Kanye West, who took to
Speaker 1: a podcast to praise Hitler and deny the Holocaust. Trump's
Speaker 1: other guests that night, the white supremacist Nick Fuente's, has
Speaker 1: called for a quote total Erran victory unquote. It would
Speaker 1: be tempting to dismiss such statements as the usual rantings
Speaker 1: by the usual crazies, except that the host of this
Speaker 1: file gathering is still the odds on favorite to be
Speaker 1: the Republican nominee for president. If Trump can't bring himself
Speaker 1: to condemn such sentiments, his party needs to. Anti Semitism
Speaker 1: has no place in American politics. This editorial was written
Speaker 1: by the Bloomberg Editorial Board. For more Bloomberg opinion, please
Speaker 1: go to Bloomberg dot com, slash opinion or O P
Speaker 1: I n go on the Bloomberg terminal. These has in
Speaker 1: Bloomberg Opinion. Bloomberg Opinion editorials can be heard every weekday
Speaker 1: at this time, and terminal customers can read more at
Speaker 1: O P I n go. Futures are higher this morning.
Speaker 1: S and P futures up ten points, Dall futures up
Speaker 1: forty one, Nasdaq futures up forty one points. Tenure Treasury
Speaker 1: unchanged the yield at three point for seven percent. Two
Speaker 1: year yield at four point two percent. Nimex CREWDE is
Speaker 1: seven tenths of a percent higher. That's about fifty cents.
Speaker 1: Trading now at seventy one dollars nineties cents per barrel.
Speaker 1: Grant CREWD trading at seventy six dollars forty four cents
Speaker 1: per barrel. It is twenty nine since higher. Up next,
Speaker 1: on Bloomberg Daybreak, We'll be talking with senior US equity
Speaker 1: strategist Nadia Level at U b S Financial Services and
Speaker 1: will look ahead at the data points that are coming
Speaker 1: out later this morning. Stay with us much more on
Speaker 1: this Friday morning. This is Bloomberg Markets headlines and breaking
Speaker 1: news twenty four hours a day at Bloomberg dot Com,
Speaker 1: the Bloomberg Business apt and at Bloomberg Quick Take. This
Speaker 1: is a Bloomberg Business lash Nathan Hagar. Futures continue to
Speaker 1: rise this morning as investors await one of the final
Speaker 1: key pieces of data before next week's a federal Reserve decision.
Speaker 1: Producer prices at eight thirty Wall Street time. We check
Speaker 1: the markets for you all day long at Bloomberg. Right now,
Speaker 1: SMP futures are up ten points down, futures up forty
Speaker 1: four NAZAC futures are on the rise by forty three points.
Speaker 1: The docks in Germany is up four tenths per cent
Speaker 1: to cack in Paris and foot seat in London, both
Speaker 1: up by one tenth of one percent. The tenure treasury
Speaker 1: is up one thirty second you'ld three point four seven percent.
Speaker 1: You'ld on the two year four point to seven percent.
Speaker 1: Nim X scrugs moving higher, up nine tenths per center,
Speaker 1: sixty five cents at seventy two dollars ten cents of
Speaker 1: barrel comes gold up two tenths per cent or three
Speaker 1: dollars d cents at eighteen o five thirty announced. The
Speaker 1: Euro one point zero five five nine against the dollar,
Speaker 1: British pound one point seven. The en is at one
Speaker 1: thirty six point zero eight. Bitcoins hire by two tenths percent,
Speaker 1: trading around seventeen thousand, two hundred dollars on top of
Speaker 1: producer prices. At ten am this morning, we get wholesale
Speaker 1: inventories and the University of Michigan Sentiment Index. That's a
Speaker 1: Bloomberg business flash. Now here's Michael Barr with more on
Speaker 1: what's going on around the world. Michael Nathan, thank you
Speaker 1: very much. Federal prosecutors will ask a judge today to
Speaker 1: hold former President Trump's lawyers in contempt for failing to
Speaker 1: fully comply with the subpoena that requires the return of
Speaker 1: all classified documents Trump might be holding. A Trump spokesman
Speaker 1: says this is a political witch hunt. W n B.
Speaker 1: A star Britney Grinder will arrive in San Antonio, Texas
Speaker 1: soon after spending more than nine months in Russian custody.
Speaker 1: Your family has asked for privacy for Grinder to heal.
Speaker 1: Thursday Night football with the Rams beat the Raiders. Seventeen
Speaker 1: sixteen FIFA World Cup action resumes today. Croatia plays for
Speaker 1: zill The Netherlands faces Argentina. Globals twenty four hours a
Speaker 1: day on air and on Bloomberg Quicktake, powered by more
Speaker 1: than hundred journalists and analyist more than a hundred twenty countries.
Speaker 1: Michael Barr, this is Bloomberg Gaming, all right, Thank you, Michael.
Speaker 1: It is five forty two on Wall Street and this
Speaker 1: is Bloomberg Daybreak. I'm Amy Morris alongside Nathan Hagar. Let's
Speaker 1: take a look at some of the other stories making
Speaker 1: news this morning. We take a look at stocks on
Speaker 1: the move, starting with Lulu Lemon shares our down six
Speaker 1: point nine percent in the pre market after the yoga
Speaker 1: wearemaker reported lower than expected profitability. We get that story
Speaker 1: from Bloomberg's Charlie Pellett. Gross margin, a key gauge of profitability,
Speaker 1: was fifty five point nine percent in the third quarter.
Speaker 1: That was short of analyst savage estimate of fifty six
Speaker 1: point seven percent. Inventories also surged from a year earlier,
Speaker 1: evoking similar problems experienced by retailers that have led to
Speaker 1: profit busting markdowns. Lulu Lemon raised at sales forecast for
Speaker 1: the full year ending in January too as much as
Speaker 1: seven point nine nine billion dollars. While that is up
Speaker 1: from the previous range of as much as seven point
Speaker 1: nine four billion, the low end was still below analysts
Speaker 1: average estimates. In New York. Charlie Pellette bloom Bird Daybreak.
Speaker 1: All right, Charlie, thanks for also keeping an eye and
Speaker 1: shares of Broadcom this morning. They're up about three percent
Speaker 1: after the chip maker gave an upbeat sales forecast. Company
Speaker 1: indicates demand remains strong from corporate customers and the data
Speaker 1: center industry. At the same time, Broadcom is declining to
Speaker 1: give full year guidance for three citing uncertain economic conditions.
Speaker 1: Shares of DocuSign are up eleven percent this morning. The
Speaker 1: company reported earnings that top two estimates and boosted its
Speaker 1: revenue guidance for the full year. DocuSign provides electronic signature
Speaker 1: solutions for businesses to prepare, sign and manage contracts, and
Speaker 1: the hits keep coming. For carbona Amy, those shares are
Speaker 1: down nearly five percent. It's giving up some of yesterday's
Speaker 1: massive gain. The stocks surged nearly thirty percent after we
Speaker 1: reported Carbon is consulting with lawyers and investment bankers about
Speaker 1: options for managing its deadload. We're told the used car
Speaker 1: sellers looking at options as its bonds trade below fifty
Speaker 1: cents on the dollar. And Nathan, while we are waiting
Speaker 1: for the PPI data this morning, we want to talk
Speaker 1: about that and a few other data points with senior
Speaker 1: US equity strategist Nadia Level at you b As Financial Services. Nadia,
Speaker 1: thank you for taking the time with us on this
Speaker 1: Friday morning. First of all, what are you looking for
Speaker 1: out of today's data? You know, we do expect that
Speaker 1: the producers prices today will continue to moderate. We know
Speaker 1: commodity prices including lump a week and all have come
Speaker 1: down and that should help. But I think what's the
Speaker 1: most important for the market is going to be next
Speaker 1: week the CPI. I mean, you do expect some modest
Speaker 1: moderation and not as well versus prior months of good
Speaker 1: size is seeing disinflation as supply chain destructions continue to improve.
Speaker 1: We've seen use cars prices come down as commodity prices
Speaker 1: of mark behind gasoline prices UM. But I also think
Speaker 1: the key factor for CPI will be that core services
Speaker 1: X housing um as that's likely to really be a
Speaker 1: key driver of the fence REACTRA function going forward. We
Speaker 1: noted that Paul pointed that out last week. So Nadia
Speaker 1: is peak inflation then behind us, we think so we
Speaker 1: think that peak inflation is behind us, but inflation is
Speaker 1: going to remain elevating their term. I mean, we're seeing
Speaker 1: progress being made, but we don't think that you're going
Speaker 1: to get something that's more in line with the fence
Speaker 1: UM to PENT target until you probably get into four.
Speaker 1: We expect cores um CPI to get to probably about
Speaker 1: four percent by the time we get to make three
Speaker 1: and then in the sort of two to three percent range.
Speaker 1: But time we get to an end of next year,
Speaker 1: and that's going to be driven by a slowdown in economy. Really, okay,
Speaker 1: that's exact. I love it when the guest anticipates my questions.
Speaker 1: So what do you think about growth heading into We
Speaker 1: expect road to de celebrate. We know that monetary policy
Speaker 1: acts for a lot, and we're gonna see the full
Speaker 1: effect of all these rap guys that we've had over
Speaker 1: the last year in tw So we are looking for
Speaker 1: a mile a session, a short one in twe by
Speaker 1: time we get to mid year, and then we think
Speaker 1: that the Fed pause in the early part of the
Speaker 1: year and then probably look to cut towards the end
Speaker 1: of the year as the economy enter recession and that's
Speaker 1: just help grow to SOT to resume when we get
Speaker 1: into two. So are you then expecting a mild recession
Speaker 1: in the coming year and we need to buckle up.
Speaker 1: We do need to buckle up. There's gonna be a
Speaker 1: lot of volatility. But we do know that the the
Speaker 1: equity market quote unquote tensity of forward looking market, and
Speaker 1: we're gonna think that we're gonna see a lot of
Speaker 1: volatility in the first half of the year. I mean,
Speaker 1: right now the market is in somewhat and we'll wait
Speaker 1: and see Moses and somewhat directional less waiting for the
Speaker 1: FED decision next week. But when we get into the
Speaker 1: first half of the year, we think that some of
Speaker 1: those loads that we saw in October could be retested
Speaker 1: as the earnings of downgrade e ellerate in the first
Speaker 1: half of the year. So buckle up for the first half,
Speaker 1: be patient, and then start to nibble in the market
Speaker 1: as we see those pool back come because we think
Speaker 1: that you're going to get a resumption UM in the
Speaker 1: upward trend in the market towards the second half of
Speaker 1: next year and into so a little bit rocky in
Speaker 1: the first part of three kind of eats all eases
Speaker 1: off UM. And you mentioned earnings. I'm curious about what
Speaker 1: you see from earnings expectations. You have mentioned in the
Speaker 1: past that the expectations are too high. Are you standing
Speaker 1: by that. We're standing by that. That come in quite
Speaker 1: a bit, but we still think there's just more to go.
Speaker 1: I mean, you're hearing from companies, even just the news
Speaker 1: that you just update on margins are gonna be on
Speaker 1: the pressure in twenty three. We think that those are
Speaker 1: gonna come in, and so the consensus expectation for growth
Speaker 1: next year just doesn't make sense in a slowing economy.
Speaker 1: And so we're thinking that you're probably going to see
Speaker 1: at least four to five percent contraction in earnest for
Speaker 1: next year versus that five percent growth that the consensus
Speaker 1: is being four. And a lot of that is gonna
Speaker 1: depend on how shallow this recession and how short the
Speaker 1: recession is going to be. If it's worse than we expect,
Speaker 1: you could see earning's down in the mid teens. That's
Speaker 1: sort of what typically happens in the plain vanilla recession,
Speaker 1: if you will, vanilla recession. Um, while we are watching
Speaker 1: for this recession, what are the sectors that you are
Speaker 1: looking into? What are you watching for in just the
Speaker 1: next few months. I think you want to be positioned defensively.
Speaker 1: You want to look for those sectors that where the
Speaker 1: earners are going to be more durable and less at rest,
Speaker 1: and that by that I mean like consumer staples, healthcare.
Speaker 1: You know also think that energy is interesting here is
Speaker 1: still interesting despite the volatility that we're seeing in oral,
Speaker 1: we think that all is going to get back above
Speaker 1: a hundred dollars on Brent, and that should be supportive
Speaker 1: to the energy sector. And also just recently you've just
Speaker 1: seen a decoupling between the commodity and the sector. A
Speaker 1: lot of these companies are generated into tremendous amount of
Speaker 1: pre cash for pre cash for all meals on the
Speaker 1: low teens. Diffident eyels are in the high single digits.
Speaker 1: So we also think that energy is in the area
Speaker 1: to continue to invest in. And very briefly twenty seconds
Speaker 1: here will today's PPI data matter not as much as
Speaker 1: next week's CPI. All eyes is on that and also
Speaker 1: the FED dots the next next week. We want to
Speaker 1: see how high is that terminal rate ultimately is going
Speaker 1: to be. We know it's higher, but by how much?
Speaker 1: All Right, we're gonna be watching it with you, Senior
Speaker 1: US equity strategist Nadia Level at UBS Financial Services. Some
Speaker 1: of the most important data points that are going to
Speaker 1: be coming out before the next FED meeting that's coming
Speaker 1: up next week. Now, let's look at the futures. SMP
Speaker 1: features are ten points higher, DAL futures up forty points,
Speaker 1: Nasdaq futures up forty four. Ten year treasury unchanged, the
Speaker 1: yield at three point four eight percent. Much more still
Speaker 1: to come on this Friday morning. Stay with us. We'll
Speaker 1: have more in insight into the p P eight I
Speaker 1: data coming out. This is Bloomberg Markets, headlines and breaking
Speaker 1: news twenty four hours a day at Bloomberg dot Com,
Speaker 1: the Bloomberg Business at and at Bloomberg Quick Tape. Bruce
Speaker 1: is a Bloomberg Business Flash. I'm Nathan Hagar. Futures are
Speaker 1: moving higher ahead of this morning's producer price data. We
Speaker 1: checked the markets all day on Bloomberg. SMP futures are
Speaker 1: up ten point Staff futures up forty two nastack futures
Speaker 1: hired by forty three points ten. Your treasuries little change
Speaker 1: the old three point four seven percent. Nimex crude is
Speaker 1: up one point one percent at seventy two twenty four
Speaker 1: cents a barrel comes gold up a quarter percent at
Speaker 1: eighteen o five eight announced. The euro is at one
Speaker 1: point zero five five three against the dollar, the yen
Speaker 1: one thirty six point zero four And that is a
Speaker 1: Bloomberg Business Flash, Amy Nathan. It is five fifty six
Speaker 1: on Wall Street time for our daily Bloomberg Law Brief,
Speaker 1: exploring legal issues in the news today we're looking at
Speaker 1: the Supreme Court considering a novel in far king argument
Speaker 1: that would give state legislatures virtually unchecked power to make
Speaker 1: rules for congressional and presidential elections, and they would do
Speaker 1: so essentially without any oversight from state courts. At oral
Speaker 1: arguments on Wednesdays, and key justices expressed weariness about the
Speaker 1: so called independent state legislature theory, which would preclude state
Speaker 1: judges and other officials from performing longstanding roles in shaping
Speaker 1: congressional districts, voter eligibility, and mail in ballot requirements for
Speaker 1: more were on the case. Bloomberg's June Grosso speaks to
Speaker 1: constitutional law professor Stephen Vladik of the University of Texas
Speaker 1: Law School. Did it seem to you at the oral
Speaker 1: arguments there were three camps of justices, the three liberals
Speaker 1: who were firmly against this theory, the three conservatives who
Speaker 1: are farthest to the right, who were in favor of it,
Speaker 1: and then the three justices in the middle, who seemed
Speaker 1: to be in the middle. I think that's right. I mean,
Speaker 1: I think you know, there has been concurrent opinions in
Speaker 1: the last couple of years where at least four justices
Speaker 1: have expressed some modicum of support for the independent theories.
Speaker 1: But I think what we saw at the argument is
Speaker 1: that there really are only three who are all the
Speaker 1: way in on what really would be a radical we
Speaker 1: write in of federalism, of how we understand the Constitution
Speaker 1: to structure the relationship between the federal government and the states.
Speaker 1: So I don't think we're gonna end up with five
Speaker 1: votes for either of the extreme possibilities. That is to say,
Speaker 1: either five votes to endorse the extreme version of the
Speaker 1: independent legislature theory or five votes to categorically reject it.
Speaker 1: What's much less clear to me is whether there are
Speaker 1: going to be five votes for any version of the theory,
Speaker 1: because once you cross the line, once you say that
Speaker 1: there are circumstances in which, you know, the federal Constitution
Speaker 1: outside of state the process cause, but just the literal
Speaker 1: reference to the legislature in the federal Constitution just empower
Speaker 1: state supreme courts in any circumstance. You know, I think
Speaker 1: that's a pretty dangerous road to go down. Neil Katya,
Speaker 1: who was arguing for the voters who challenged and North
Speaker 1: Carolina Map, said the blast radius from their theory with
Speaker 1: so election chaos. So this theory could apply to anything
Speaker 1: the legislature decides to do, rules on mail and ballots,
Speaker 1: absentee voting, anything. I mean, that's you know, it depends
Speaker 1: on how far you go. But at its broadest, you know,
Speaker 1: taken literally the independence, that legislature theory would basically say
Speaker 1: that state constitutions are just about irrelevance when it comes
Speaker 1: to the rules the state legislatures set for federal elections,
Speaker 1: and that you know, a state legislature consider a rule
Speaker 1: student that might violate the federal constitution, but that there's
Speaker 1: no room for state supreme courts to strike down whether
Speaker 1: it's congressional districts or voting rules or anything of the
Speaker 1: life on the round, violates the state constitution, and that
Speaker 1: would have obviously dramatic consequences. There's a kernel out there
Speaker 1: about whether that would even allow a state legislature to
Speaker 1: throw out the results of a presidential election. I think
Speaker 1: there are ways to embrace the broad version of the
Speaker 1: theory without going quite that far. But you know, the
Speaker 1: Overton window has already moved so much on this series,
Speaker 1: and I think it's not irrational for folks to be
Speaker 1: worried about that propect Stephen Vladdock of the University of
Speaker 1: Texas Law School, speaking with Bloomberg's June Grosso. Catch more
Speaker 1: of that interview, plus analysis of the latest legal news,
Speaker 1: by subscribing to the Bloomberg Law Podcast or downloading the
Speaker 1: show at Bloomberg dot com slash podcasts. Attorneys can find
Speaker 1: exceptional legal research and business development tools at Bloomberg Law
Speaker 1: dot com and on the Bloomberg terminal at blog go
Speaker 1: and straight. I had to check on the business headlines
Speaker 1: and all the news you need to start your day.
Speaker 1: Our two of Bloomberg Daybreak starts right now.