Good morning. I'm Brian Curtiz and I'm Doug Krisner. Here are the stories we're following today.
Well, Amazon's saying that revenue in the current quarter will be one hundred and thirty eight to one hundred and forty three billion dollars. That beat analyst projections of just over one hundred and thirty eight billion. Amazon is optimistic based on strong performance from its main e commerce business, and this comes as the company has been investing heavily in its logistics operations. We're here from Bloomberg's Punamgoyle.
They continue to invest in that fast and free shipping and really speeding up those timelines. So I think the margin story, more than on the retail side, is just able. Also turning to growth and really driving up that profitability to allow for other areas of investment is key here.
Yeah, that AWS revenue growth was twelve percent, and that was higher than the expectation of ten percent got a lot of attention. Amazon saying that the pace of growth in its profitable cloud business did slow though over all for a sixth straight quarter. However, Amazon has been ruling out various products based on generative artificial intelligence, and the company thinks the cloud business will ultimately benefit from this.
We've seen some pretty strong gains in after hours. At the moment, Amazon is up nine point eight percent in late trading.
We go to Apple next. After the bel the company reported sluggish iPhone sales for the third quarter. We're talking about slippage in the vicinity of two point four percent. Total revenue number here of thirty nine point seven billion. I guess you could say that these results show the iPhone may be suffering from a broader slump in the smartphone market. But Bloomberg's anarag Rana tells us sales in China will be important going forward.
It's about twenty percent of overall sales for Apple, and you know, our analysts in Asia think that China is going to be very strong this year because, as I said, last year, because of COVID, they did not sell that many phones there. And the rumor is that the Apple lifehone fifteen, the Pro Max model with will have an unbelievable camera and that really does help unit shipments in China more than any other region.
That is Bloomberg's anaag Rana. Now we also should point out that Apple reported gains and services that seemed to be a bright spot in an otherwise lackluster quarter, and it helped Apple deliver overall revenue of eighty one point eight billion, just above analyst projections. Brian, Right now, I'm looking at Apple shares down nearly two and a half percent in the late US session.
Yeah. Well, tomorrow we'll be getting the US employment data for the month of July. That comes at eight thirty in the morning Wall Street Time. Let's get a preview here from Bloomberg's Michael McKee. Will July be the month the labor market finally slows? Fed officials have forecasts less hiring, more unemployment, and smaller wage gains for some time, but the monthly data have generally gone the other way. Economists see only a slight drop in hiring for last month
and no change in the unemployment rate. Average hourly earnings gains, though slowing, are still forecast to be rising at at unsustainable pace, and inline forecast is likely to keep upward pressure and interest rates. Weaker than expected numbers might bring some relief, although the FED doesn't meet again until late September. Michael McKee, Bloomberg Daybreak Asia.
Well, speaking of central banks, the Bank of England raised its benchmark lending rate a quarter point today twenty five basis points, so we have a new fifteen year high at five and a quarter percent, and the BOE also left the door open for further action if inflation persists. Here's BOE Governor Andrew Bailey.
It's the last mile, which obviously where policy is.
Really doing the work. It's going to have to remain restrict to have this effect of bringing inflation down, and particularly next year.
That is Andrew Bailey, the Governor of the Bank of England. He went on to say it's far too soon to speculate about lower interest rates. UK policymakers have a labor market and inflation report, both actually will be coming before the next rate decision, and the BOE will next meet on September twenty first. Brian Well to this part of the world.
China is asking the public to inform on obstacles to business in the private sector. We get the story from Bloomberg's Joan Wong.
Here in Hong Kong, the government wants step offs on everything from barriers to market entry, to unfair competition, local protectionism, and arbitrary fines. Beijing will ask local officials to intervene or send in supervision teams for more serious cases. This is seen as China's latest show of concern for the inbattled private sector. The appeal comes as President Chijingping tries to promote a more welcoming environment for the private sector.
The People's Bank of China also said it would ensure the sector received the extra resources and needed to grow.
In Hong Kong.
Join Wang Bloomberg Day, Brigasia Doug.
I wanted to add to some of your comments about looking at yields moving up like this, and I think a lot of people asking the question why you mentioned hot jobs. Others are talking about the Treasury issuance, the Fitch warning, and also the Bank of Japan guiding yields. But what isn't mentioned as much is that the consensus now is moving away from recession and investors need less of a hedge against their equity portfolio. We heard that from Jim Karen on surveillance late last night my time.
He's one of the bond gurus over at Morgan Stanley, and the big Acman point is that inflation will stay higher for longer, and you know, if you put all those things together, that must be six reasons there for yields popping. We're at a yearly high for the tenure yield, not quite over the four and a quarter we saw last year in November, but prior to that, you have to go all the way back to two thousand and seven to get to these levels.
I think that's a very good point. Brian, Yeah, four seventeen on the ten year and as long as we're talking interest rates, and made this point earlier on the other program that we kind of lead into or that leads into us our show that China Central Bank may cut the reserve requirement ratio for major banks as soon
as this month. This is really coming from a number of analysts, but I'll cite CIDIC Securities pointing out that there is a pretty much a large liquidity gap in the month of August and because of that, and you're dealing with this environment where there's going to be a number of maturing loans coming through well, not only this month,
but the remainder of the year. Maybe it's incumbent upon authorities to consider a possibility of a triple R cut that can't be ruled out as a way of making sure that banks have enough money to lend.
Yeah, but we're in the point now, we're at the point where investors are really kind of in a show me story, So that would be one thing. They need a lot of things, and they need to see some performance and some change. We got a little bit of change from the taishin services data yesterday came in pretty solid, and that helped restore a little bit of optimism which obviously had been fading a quick point. Amazon investors pretty
impressed there with that. I think the cloud revenue ticking up a little sort of stops that decline after quarter. But the Apple story not impressed, particularly with China. I think we sort of knew that given what Qualcom delivered yesterday. All right, now it's time for Global News. Donald Trump has pleaded not guilty to charges that he conspired to obstruct the twenty twenty two, or rather the twenty twenty presidential election. Head backs to with Global News in San Francisco.
Ed, yeah, as well, Brian as conspiring to interfere with the voting rights of millions of Americans. Now, as plea came in his arraignment in which he was advised of the counts against him, This is just the latest now, but maybe the most serious of the cases lined up against him. Three active, one expected in Georgia, not a federal case in which voting interference charges are expected to drop as well. Bloomberg Kaylee Lyons has been outside the courtroom today.
It should be four cases that the former president is fighting. The New York trial set for marshap next year. The Florida trial in May of twenty twenty four will have to wait for the trials on this one. But Jack Smith, a special counsel who's office brought the chargers, said they would like it to be speedy.
Now the judge has set the hearing for the June twenty eighth, where Judge Tanya Chutkin intends to set a drial date. Judge Shutkin and an Obama nominee who has ruled against Trump motions in the past. Now, Trump did comment to the media pool as he left of the Reagan Airport with the same drumbey.
This is a persecution of a political opponent.
This was never supposed to happen in America.
Yeah, the judge has set the next hearing for the twenty eighth. The Republican candidate will heard Bloomberg sound On says Trump is no longer running for America.
He's a bully, he's a liar, and he's only running in order to stay out of prison. And what's even crazier is that he is using, you know, hard working Americans' dollars to fund his illegal bills. Right, He's allegedly a billionaire, but he can't pay his own legal bills.
And to Herd's point, the pro Trump pack reported in the week that it had spent most all of its campaign fundraising money in legal defense. Two US Navy sailors have been arrested on charges of providing sensitive US military information to China. The Justice Department calls it a relentless effort by China to gain US secrets. It says China paid for the information. The US Attorney for the Southern District of California, Randy Grossman, says these are very serious charges.
Statutes reserved for the most serious circumstances involving the passage of national defense information intended to harm the United States or for the benefit of a foreign power. The fact that we've charged it in this case in San Diego is a reflection of the seriousness of ways alleged conduct.
Now both men are Chinese born naturalized US citizens. One, it is alleged, was paid thousand dollars for information on vulnerabilities of ships, of photos of military hardware, and scores of technical manuals. DOJ says this places lives of military personnel at risk and weekends US Security Global News powered by more than twenty seven hundred journalists and and list in over one hundred and twenty countries. In San Francisco, I'm Ed Baxter, and this is Bloomberg.
This is Bloomberg Daybreak Asia. I'm Brian Curtis, along with Doug Krisner. Ushad Salamat is on TV assignment this hour. Our guinst is Carol Pepper, founder and CEO at Pepper International. I would note that Amazon is now up more than ten percent in late trading after its earnings, and Carol, you say a tech boom is coming. I would counter that just a little bit, with yields drifting higher like this is definitely cutting in to a certain extent on
some of the gains in big tech. Microsoft, for instance, even after an impressive earnings report, is down since that period. Your thoughts on where tech goes from here.
Yes, well, I think tech has a nice long run ahead of it because we've got some very large sacular trends that are going to continue to play out. So every industry is going to be affected by artificial intelligence that it's going to have to do some sort of
an upgrade. We've also seen that companies corporations have stopped, you know, sort of just doing stock buybacks and are reinvesting in technology and capital for the companies understanding that they need to get ready for this next evolution because robots and technology, frankly are going.
To the gains. I think the question is all the gains already in No, not at all.
We're just at the beginning. This is just starting. We've got a ten year run here. You recall I manage money for people that have family offices over one hundred million dollars. So we're always thinking about what are the long term trends that we need to be part of. And so this new push on AI, with the fact that it's finally getting released and integrated into all kinds of businesses, means we're just at the start of a new secular trend in technology. The same with cybersecurity. We've
talked about that. You know that cybersecurity, which is also an aspect of technology, will continue to have to be a strong area of investment globally for all these corporations. So I like to find long term trends that are going to last for a long time. And it doesn't matter if fields or up or down this month or for six months. We're talking about how do you make money over ten years. I mean, you look at Microsoft.
My goodness, if you had invested in that company, you know, twenty years ago, you would have been up to almost twenty nineteen hundred percent. So you have to look about look at that nineteen hundred percent over twenty years.
Brian and I were talking earlier, Caroll.
On your time horizon. Your time horizon is key.
We were talking a moment ago about how the bond market seems to be repricing under our scenario for a soft landing. I mean that kind of supports a little bit the growth story that you seem to be laying out. But you don't. You're not bothered by the notion that we could get a you know, four to twenty five, let's say, on the ten uere but for how.
Long this is the question. If the soft landing happens right, then sentiment shift. Remember also, August is always a funky month. Half the traders are on vacation, there's not a lot of volume in the market, and small pieces of news move things around quickly, and so I think you get a better indication of where yields are going to end up in another month and a half after September fifteenth. You know, you don't really want to go crazy about
what the market is indicating in August. It's never accurate.
Carol, I think many would agree with you about the future prospects for these companies. There's not really too much doubt about that. But the question, and the reason I butted in before was the example of Microsoft, is that the stock gained so much that investors are sort of backing away as they are starting to sort of back away a little bit from Apple. So it definitely is show me new with new business, with new gains, and
that's the part that maybe just takes some time. I'm not sure that these companies are monetizing AI at the moment, so we have to be concerned about the big gains in the stock prize.
Well, look at Amazon, for example. The problem with these companies. A lot of these big companies in technology, they'll have a huge run up and then they'll go flat for a year or two, and then they might go down a bit, and then suddenly they'll have another run. So Amazon from last year to now is up almost fifty percent. If you had been out of Amazon and not sure when the run was going to happen, you would have missed that fifty percent gain. People may say, well, fifty percent,
that's it. It's not going any higher, but again over what period of time, And it's very hard to time the market.
This is Bloomberg Daybreak Asia, your morning brief on this story's making news from Hong Kong to Singapore and Wall Street.
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