Speaker 1: Live from the Bloomberg Interactive Burgers Studios is Bloomberg Daybreak
Speaker 1: for Monday, March six. Coming up today, Tensions heat up
Speaker 1: as the US considers banning investments in parts of China,
Speaker 1: Credit sweet So loses support from one of its biggest backers.
Speaker 1: Investors await testimony from FED chair j Howe and Friday's
Speaker 1: jobs report, and the Republican field narrows as former Maryland
Speaker 1: Governor Larry Hogan bows out of the presidential race. An
Speaker 1: e bite fire Injures five in the Bronx and Mayor
Speaker 1: Ammas is a warning for fellow Democrats. I'm John Tucker.
Speaker 1: Those stories straight ahead. I'm John Stash, Aaron Sports making
Speaker 1: nine wins in a row for the Knicks, a thrilling
Speaker 1: double overtime victory in Boston the next and Devils also won.
Speaker 1: That's all straight ahead on Bloomberg Daybreak, The Business news
Speaker 1: you need disturn your day, and just one fifteen minute
Speaker 1: podcast each pointing on Apples, Spotify, the Bloomberg Business Appen
Speaker 1: everywhere you get your podcasts. Good morning, I'm Nathan Hagar
Speaker 1: and I'm Karon Moscow. Here are the stories we're following today.
Speaker 1: We could see more tension between the US and China.
Speaker 1: Coming out of Capitol Hill this week, the head of
Speaker 1: the Senate Intelligence Committee, Mark Warner, says he will introduce
Speaker 1: a bipartisan bill that would allow the US to systematically
Speaker 1: ban Chinese technology. Warner says that includes TikTok. They are
Speaker 1: taking data from Americans. Stop keeping it safe. But what
Speaker 1: worries me more with TikTok is that this can be
Speaker 1: a propaganda tool. Senator Warner made the comments on Fox
Speaker 1: News Sunday. He says China presents a bigger threat to
Speaker 1: the US than the Soviet Union. Well, Nathan, The TikTok
Speaker 1: news comes as the White House closes in on an
Speaker 1: executive order banning a US investment in parts of the
Speaker 1: Chinese economy, and we get the latest live with Bloomberg.
Speaker 1: Steve Rappaport. Good morning, Steve, Good morning, Karen, and Nathan.
Speaker 1: The restrictions target investments in projects that can be used
Speaker 1: in China's military applications, including AI and codebreaking technologies. That's
Speaker 1: according to sources who say the White House submitted to
Speaker 1: reports to Congress on Friday outlining the cost to set
Speaker 1: up a so called outbound investment program with the Treasury Department.
Speaker 1: Those reports obtained by Bloomberg indicate President Biden is prepared
Speaker 1: to request funding for the effort this week in his
Speaker 1: fiscal twenty twenty four budget. Live in New York. I'm
Speaker 1: Steve Rappaport, Bloomberg Daybreak. Steve. Thanks Meantime, China is setting
Speaker 1: out a modest economic growth target from its National People's
Speaker 1: Congress of around five percent for this year. Beijing's leaders
Speaker 1: are avoiding any form of large stimulus. Bloomberg's Jill DSIs
Speaker 1: in Hong Kong says it's a conservative target somewhere on
Speaker 1: five percent. Gives Beijing quite a lot of room to
Speaker 1: work with, but they also want to They don't want
Speaker 1: to overstimulate the economy. They kind of want to keep
Speaker 1: things on track, and ultimately, I think what Beijing is
Speaker 1: looking for this year is economic growth that's really going
Speaker 1: to be driven by a rebound in demand. Bloomberg's Jill
Speaker 1: DSIs says, Chinese Premier League Could Chang hinted Beijing would
Speaker 1: support housing but would also regulate the sector more tightly.
Speaker 1: Well back here in the US, Nathan, we're learning more
Speaker 1: about the president you'll field for twenty twenty four. Former
Speaker 1: Maryland Governor Larry Hogan says he will not seek the
Speaker 1: White House. Bloomberg's Ad Baxter has that story. Hogan says
Speaker 1: a full field will be very bad for the party
Speaker 1: in the country. Hogan on CBS has heard here on
Speaker 1: Bloomberg says the party needs to focus on traditional Republican
Speaker 1: values now without causing being part of a train wreck
Speaker 1: that might repeat history, and just allow us to nominate
Speaker 1: Donald Trump as our nominee, because I think that would
Speaker 1: be bad for the party and bad for the country now.
Speaker 1: Trump prevailed in twenty sixteen with about thirty percent of
Speaker 1: the vote in the party, with a field widely split
Speaker 1: about where things look to stand now. In San Francisco,
Speaker 1: I'm at Baxter Bloomberg Daybreak, Thank you, Ed. Turning to
Speaker 1: the economy, it's a big week for US investors. It
Speaker 1: all starts with FED chair J Powell testifying before the
Speaker 1: Senate tomorrow. We get more from Bloomberg Markets reporter Valerie Title.
Speaker 1: It's going to be his last remarks before the next
Speaker 1: meeting on March twenty second, and markets are going to
Speaker 1: be paying very close attention to if he keeps using
Speaker 1: this word disinflation. We haven't heard from him since the
Speaker 1: last CPI report that showed that this disinflation, especially when
Speaker 1: it comes to the good, the good section of inflation,
Speaker 1: is slowing. Does he perhaps change his change his posture,
Speaker 1: change his tone. Does he maybe not use that word?
Speaker 1: Also any hints on his view of the recent string
Speaker 1: of strong data. Does he cast it maybe as a
Speaker 1: one off down to seasonal's being readjusted in the new year.
Speaker 1: Bloomberg's Valerie Titel says after Powell, attention turns to Friday
Speaker 1: with the release of February's jobs report. Well in Europe today,
Speaker 1: Nathan shares a Credit sweee or down more than one percent.
Speaker 1: The troubled Swiss Bank has law support for a moment
Speaker 1: of its biggest backers, Harris Associates, has sold its entire
Speaker 1: stake in Credit Suiee. The investment firm's chief investment officer,
Speaker 1: David Harrow, is questioning the future of the lender. Those
Speaker 1: comments follow an interview Harrow did with Bloomberg last August
Speaker 1: where he issued this morning and the Swiss Bank, you
Speaker 1: can't keep doing the same thing as they've been doing
Speaker 1: over the last decade and get zero results. They have
Speaker 1: to put an end to it at some point they
Speaker 1: either have to fix it or to look for other options.
Speaker 1: And that was Harris Associate's chief investment officer David Harrows,
Speaker 1: speaking to Bloomberg in August. Harris was the biggest shareholder
Speaker 1: in Credit Suite for many years. The firm had its
Speaker 1: stake last year and is now reportedly exited entirely. One
Speaker 1: other bank news out of Europe today, Karen, we're learning
Speaker 1: UBS cut employee bonuses by ten percent last year. The
Speaker 1: move follows a slump at UBS in advising on mergers
Speaker 1: and stock and bond issuance. Well, City Group is preparing
Speaker 1: to almost double its staff in Paris. The bank is
Speaker 1: building a new trading floor there and its trading division
Speaker 1: will eventually have two hundred and fifty people. They expansion
Speaker 1: in Paris comes as City and its rivals continue to
Speaker 1: grapple with life after breaks it and capping off our
Speaker 1: banking news. Karen, please join us today for a special
Speaker 1: conversation with Jamie Diamond, The JP Morgan Chase CEO, sits
Speaker 1: down an exclusive interview on Bloomberg Radio and Television today
Speaker 1: at eleven thirty am Wall Street Time. You can listen
Speaker 1: live on Bloomberg radio at Bloomberg dot Com or on
Speaker 1: the Bloomberg Business app. It's forty degrees in New York.
Speaker 1: It'll be sunny this morning with clouds will increase through
Speaker 1: the day on our way to the low fifties rain
Speaker 1: tonight will change into a bit of snow in the
Speaker 1: overnight hours, lows in the low thirties. Time now to
Speaker 1: take a look at some of the other stories making
Speaker 1: news in New York and around the world with Bloomberg's
Speaker 1: John Tucker. Good Morning John, and Good morning Nathan. Another
Speaker 1: warning about e bikes in their batteries. New York City
Speaker 1: Fire Marshall blames a burning lithium ion battery and a
Speaker 1: scooter for a five alarm fire that tour through a
Speaker 1: commercial building in the Bronx on Sunday. For firefighters, one
Speaker 1: person were injured. Eric Adams, as the mayor, When you
Speaker 1: saw how fast this fire started and spread, it's just
Speaker 1: really give you a point of poise. The fire department
Speaker 1: arrived at the scene within four minutes, but the flames
Speaker 1: were so intense the structure was destroyed. At a hallowed
Speaker 1: site for the nineteen sixties civil rights movement ahead of
Speaker 1: a planed twenty twenty four reelection bid. President Biden tried
Speaker 1: to solidify support among black voters as a saying, oh,
Speaker 1: silentist complicity, and I promise you my administration will not
Speaker 1: remain silent. I promise you. Biden spoke in Selma, Alabama,
Speaker 1: marking the fifty eighth anniversary of Bloody Sunday, when state
Speaker 1: troopers attacked voting rights demonstrators. He listened to accomplishments in
Speaker 1: the White House, including appointing the first black woman Supreme
Speaker 1: Court justice. At the Conservative Political Action Conference held in
Speaker 1: the DC suburbs over the weekend, former President Donald Trump
Speaker 1: was asked if he'd continue his presidential ambitions if he
Speaker 1: were indicted. Absolutely. I wouldn't even think about leaving. Another
Speaker 1: news is a small plane trying to return to a
Speaker 1: suburban Long Island airport after the pilot reported smoke in
Speaker 1: the cockpit crashed on Sunday, getting one person and critically
Speaker 1: injuring the two others on board. No injuries reported on
Speaker 1: the ground. The Piper aircraft crashed shortly after three pm
Speaker 1: while returning to attempt and emergency landing at Republic Airport
Speaker 1: in Farmingdale, and authorities in Ohio say there's no indication
Speaker 1: of any risk to public health from the derailment of
Speaker 1: a Norfolk Southern cargo train between Dayton and Columbus, the
Speaker 1: second derailment of the company train of the state in
Speaker 1: a month. Twenty eight of the train's two hundred and
Speaker 1: twelve cars, including four empty tankers, derailed Saturday afternoon in
Speaker 1: Springfield Township Global News twenty four hours a day, powered
Speaker 1: by more than twenty seven hundred journalist and an analyst
Speaker 1: in over one hundred twenty countries. I'm John Tucker, and
Speaker 1: this is Bloomberg, Nathan. Thank you, John, time of the
Speaker 1: Bloomberg Sports Update, brought to you by Trice stayed Outy.
Speaker 1: Good morning, John stash hour, All right, thanks Nathan. On
Speaker 1: a weekend for the nixt THEO win Friday in Miami
Speaker 1: with the Julius Randall Heroics. They went to Boston Celtics
Speaker 1: out to avenge their lost last Monday at the Garden.
Speaker 1: They also blew a twenty eight point lead Friday and
Speaker 1: lost to the Nets. Celtics seemed in good shape, led
Speaker 1: by fourteen midway to the third quarter, but by the
Speaker 1: time they went to the fourth the Knicks had the lead.
Speaker 1: They actually went up by eleven and the fourth the
Speaker 1: game went to double overtime. Him in the back court,
Speaker 1: five seconds in the front court, four seconds triving rive
Speaker 1: to Horford quarter three short, one second ago. That's it.
Speaker 1: The Knicks win their ninth straight game till they back
Speaker 1: here in the third quarter. Here in the fourth quarter,
Speaker 1: going a double overtime, and they winted in Boston, ESPA,
Speaker 1: New York one thirty one, one twenty nine. They won
Speaker 1: without Jalen Brunson to a foot injury, so Emmanuel quickly started.
Speaker 1: Played fifty five minutes. He scored thirty eight points. He
Speaker 1: had the Knicks first seven of the second o't thirty
Speaker 1: one for Randall, twenty nine for RJ. Barrett. Tomorrow at
Speaker 1: the Garden, chance for ten wins in a row. They'll
Speaker 1: play Charlotte, who just lost to the Nets in brook
Speaker 1: In one h two to eighty six. Michael Bridges scored
Speaker 1: thirty three the two Stars. The Nets just traded met
Speaker 1: and Phoenix beat Dallas by two. Kevin Durant thirty six
Speaker 1: points for the Suns. Kyrie Irving had thirty for the Mats.
Speaker 1: Devils at Arizona blew a two goal third period lead,
Speaker 1: but scored twenty three seconds into overtime to win five
Speaker 1: to four. Yankees with eight runs of the ninth inning
Speaker 1: to meet the Braves ten six three run homer in
Speaker 1: the ninth by the Yanks twenty year old prize prospect
Speaker 1: Jason Domingez. He's batting four seventeen this spring. Mets got
Speaker 1: home runs from Francisco Lindor and Peter Alonzo beat the
Speaker 1: Cardinals seven to one. John Stash Bloomberg Sport live from
Speaker 1: coast to coast, from New York to San Francisco, Boston
Speaker 1: to Washington, d C. Nationwide on Sirius XM, the Bloomberg
Speaker 1: Business app, and Bloomberg dot Com. This is Bloomberg Daybreak.
Speaker 1: Good morning, I'm Nathan Hager. We are getting the trading
Speaker 1: weeks started with sucks in a bit of a holding pattern.
Speaker 1: A more modest growth target from China seems to be
Speaker 1: dampening sentiment after a rally to end last week. Let's
Speaker 1: bring in Laurie Calvacina help us get set for the
Speaker 1: trading week ahead, Head of US Equity Strategy at RBC
Speaker 1: Capital Markets. Laurie, it's great to speak with you as always.
Speaker 1: Do you see any read through to the US market
Speaker 1: from China coming out with this five percent target, which
Speaker 1: was a little bit less than what economists were expecting. Well,
Speaker 1: thanks for having me, ye as always, and I think
Speaker 1: it very much to me, just sort of keeps with
Speaker 1: the same tone that we've been experiencing lately, which is that,
Speaker 1: you know, maybe we need to soften our expectations a
Speaker 1: little bit, but this should definitely you know, I think
Speaker 1: it should be looked at as you know, the pace
Speaker 1: to recovery, or the path to recovery rather is intact
Speaker 1: at this point in time. So that's really how I
Speaker 1: take it this morning. I also think that investors have
Speaker 1: been looking for reasons to be excited about non US markets,
Speaker 1: so it feels like this kindles the fires for that
Speaker 1: theme a little bit as well. So are you dampening
Speaker 1: your expectations then for your target for the SMP five hundred?
Speaker 1: I know you've got a forty one hundred target, which
Speaker 1: isn't too far off from where we are now. You know,
Speaker 1: we feel pretty neutral on the market in here, and
Speaker 1: I feel like I continue to be sort of accused
Speaker 1: of being overly bullish by the deeply varish elements out there,
Speaker 1: but we really feel pretty even keeled from here, and
Speaker 1: I would say the idea that money flows have favored
Speaker 1: non US equities and will continue to do so for
Speaker 1: at least a little while longer, is something we've already
Speaker 1: baked into the forecast. And we've also, you know, baked
Speaker 1: into the idea that bottoms look more attractive than stocks
Speaker 1: from here. We have a couple of different models that
Speaker 1: speak to that, and people are always surprised that when
Speaker 1: I show them that in that environment, you don't necessarily
Speaker 1: see equities going down. You just have to get used
Speaker 1: to more subdued returns. I feel like it blows their
Speaker 1: mind a little bit, but nevertheless, that is what the
Speaker 1: data shows. So I think we've got you know, those
Speaker 1: kinds of pressures. The idea that stocks aren't the best
Speaker 1: game in town, we've got it already baked into the
Speaker 1: forty one view at this point. Okay, the outflows that
Speaker 1: we're seeing out of the US, does that present a
Speaker 1: buying opportunity for US stocks in the short term? So
Speaker 1: I think that, you know, the technicals have gotten everybody
Speaker 1: excited recently, and you know, we still think that we're
Speaker 1: in this kind of messy normalization period similar to O
Speaker 1: two oh three similar to twenty ten, twenty eleven. So
Speaker 1: I don't think things you're going to continue to chop around.
Speaker 1: And I think whether or not you sort of look
Speaker 1: at this as a particularly good buying opportunity really is
Speaker 1: a function of your time horizon. I think there's still
Speaker 1: a lot of opportunities and things like small caps. I
Speaker 1: think financials also look deeply compelling. They've kind of had
Speaker 1: to get some of their downward revisions for twenty twenty
Speaker 1: three out of the way. They're well into that process
Speaker 1: at this point. But I do think that you can
Speaker 1: find bargains if you look in the right places. Right now,
Speaker 1: we have seen a little bit of a pullback in
Speaker 1: terms of treasury yields right now. What does that mean
Speaker 1: for stocks in the short term. So to the extent
Speaker 1: that we get more pullback in ten year yields, that's
Speaker 1: very good for equity valuations. And you know, we continue
Speaker 1: to talk to our rate strategists who think that yields
Speaker 1: are going to move a bit lower from here. If
Speaker 1: you look at the ETFC consensus on Bloomberg, it's also
Speaker 1: calling for something more subdued from here. And when we
Speaker 1: talk to our rate strategists, I think there's going to
Speaker 1: be just a change in the flow dynamics between now
Speaker 1: and your end that could soften the yields a bit.
Speaker 1: What I see in my modeling, because remember I an
Speaker 1: equity person, is that if you pull the ten your
Speaker 1: treasury yield down, it's going to give you the room
Speaker 1: for PE multiples to expand just a little bit. And
Speaker 1: once we get to some stability in terms of earnings forecasts,
Speaker 1: and I think we're getting pretty close to that point,
Speaker 1: it should allow investors to get a little bit more
Speaker 1: confidence to get back into the equity market, know what
Speaker 1: pether paying for stocks and really be willing to say, Okay,
Speaker 1: I don't think pees need to come down anymore. I
Speaker 1: think they can move up a little bit. So I
Speaker 1: think it's really giving that stability to the valuation environment
Speaker 1: that it matters from an equity perspectives. Although, as you know, Laurie,
Speaker 1: there's been a lot of talk among market analysts about
Speaker 1: valuations getting stretched in this market. Are you starting to
Speaker 1: see signs of a little bit more stabilization in valuations
Speaker 1: or could there be more moves to come. I think
Speaker 1: that you have to pick when you're thinking about valuations
Speaker 1: and pees. I think you have to really be very
Speaker 1: specific about what year you're talking about. If I look
Speaker 1: at the PE of the S and P five hundred
Speaker 1: against last year's earnings or forecasts for next year's earnings,
Speaker 1: things look pretty reasonable if I look kind of in
Speaker 1: line with the long term average. If I look at
Speaker 1: a PE multiple against twenty twenty three earnings on my number,
Speaker 1: they look expensive. They don't look crazy expensive. But I
Speaker 1: do think investors are kind of getting to the point
Speaker 1: where they're ready to look through twenty twenty three and
Speaker 1: start focusing on twenty twenty four. And if you are
Speaker 1: willing to go ahead and make that determination, I think
Speaker 1: that you can feel a lot better, your sleep, a
Speaker 1: lot better at night in terms of equity valuation. This
Speaker 1: is Bloomberg day Break Today, your morning brief on the
Speaker 1: stories making news from Wall Street to Washington and beyond.
Speaker 1: Look for us on your podcast feed at six am
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Speaker 1: Bloomberg Daybreak