This is Bloomberg day Break Asia for his Tuesday June thirteenth in Hong Kong, Monday June twelfth in New York and coming up today.
Markets are way key US inflation data in front of the Fed's next decision.
Google and Microsoft face new competition issues, and.
Oracle's cloud business benefits from AI demand.
Miami Max's upsecurity for Trump surrender tomorrow. China deny spy base in Cuba, US blames Trump administration for not stopping it. New York Police commissioner to resign. I'm at Baxter with Global News.
That's all straight ahead on Bloomberg Daybreak Asia, the business news you need to start your day in just one fifteen minute podcast available on Apples, Spotify, the Bloomberg Business App, and everywhere you get your podcasts.
Good morning, I'm deg Prisner and I'm Brian Curtiz. Here are the stories we're following today. FED officials with their eye on the key inflation data tomorrow in the United States and that meeting of course.
This week will get the CPI.
Dated at eight thirty in the morning, Wall Street Time, Bloomberg's Michael McKee has a preview.
Economists say consumer price inflation slowed in May, led lower by falling energy and automobile prices. This inflation in rent may finally show up, holding down the core rate. Meanwhile, base effects high inflation a year ago mean a big drop in overall inflation this year. At least that's the forecast.
If analysts are wrong, however, watch out higher than anticipated inflation will change expectations for the FED policy decision due Wednesday, with officials divided over whether to raise rates or make no change. An inflation surprise would lead to big market moves. Michael McKee, Bloomberg Daybreak Asia.
After the bell, we heard from Oracle. The company reported fourth quarter sales rising seventeen percent. So we have a top line of thirteen point eight billion dollars that is one hundred million above estimates. Revenue growth was led by oracles cloud applications and infrastructure businesses, and a boom in generative AI may be boosting demand for its cloud technology going forward. Here is Bloomberg's anarog runner.
AI workloads require a lot of power, a lot of You could say, you know the engine and storage to run those, and you really can't do that. I mean, I would say only a handful of companies around the world would be able to do this internally in their own data center, so you really need a public cloud
to run that. So, whether that's you know, Microsoft, Amazon, Google, and now most recently Oracle, which is really making strides with their cloud product, I think all of these companies will benefit as people develop more AI application.
That is Bloomberg's anerog Ruana Now. So far this year, shares an Oracle are up more than forty two percent stock right now in late US trading, Hire by three point four percent ran Well.
The Federal Trade Commission has sued Microsoft in federal core. This was in an effort to block Microsoft's big acquisition sixty nine billion dollar acquisition of Activision Blizzard.
Bloomberg's and Kate says the story.
The FTC wants a transaction put on hold until the agency's in house court has a chance to rule on the deal, with that trial schedule to begin in August. The Microsoft Activision combination faces tough antitrust scrutiny in the US, and the UK ruled against the takeover in April, determining that titles like Activision's Call of Duty would bolster Microsoft's edge over rivals in the small but growing cloud gaming market.
Microsoft is appealing that decision, which is globally binding in Washington and Kate's Bloomberg day Break Asia.
Meantime, Google is set to be hit with another round of antitrust charges by officials in Europe. That story from Bloomberg's tom Busby.
Google, already facing more than eight billion euros and fines by officials in the European Union, may soon be facing billions more. As early as Wednesday, a so called statement of objections expected to be filed by officials there, targeting
Google's biggest money maker, its digital advertising unit. The new charges from the European Commission, the EU's anti trust watchdogs, takes aim at the alphabet unit's ad tech business model, which collects user data which then allows advertisers to target specific ads and to sell adspace and technology directly to advertisers. Google has not responded to the Bloomberg's request for comment tom buzzby Bloomberg Daybreak Asia.
Google did trade higher in the session today, up on one point two percent, but that was slight underperformance than Asdek itself put on one.
And a half percent.
Well in upcoming testimony, US Treasury Secretary Janet Yellen will cast the IMF and the World Bank as important counterweights to China.
Bloomberg's Joan Wong has that from.
Hong Kong, Yellen will tell the House Financial Services Committee the International Monetary Fund and the World Bank reflect American values and that they can counter China's influence in the developing world. And the prepared remarks, Yellen says the institutions provide real resources to counter non transparent, unsustainable lending. Yellen will be looking to garner congressional support for US financial b acting also slenders, but she's likely to be countered
by Republicans and the back and forth. Later today, our time could get testy and Hong Kong. I'm joined Walt Bloomberg day Brogasia.
I'm Brian Curtis along with Doug Christners. So Dog, we hit the balance scale out this week to weigh up inflation versus recession, at least from the Fed's point of view. And you know which one weighs on the economy more. Which is the bigger concern most likely? I would guess it's inflation, and we'll get the information on Now we'll get the dot plot the commentary by Jerown Powell, The Fan of the Grateful Dead.
You know, David Kelly, the chief global strategist over at JP Morgan Asset Management, was putting his finger exactly on that issue, the FED having to weigh progress on fighting inflation against the risk of recession. Now Kelly feels that the numbers that we will see going forward here will
not support any further tightening. And if he is right, he is saying now that the investment environment in which we find ourselves could support lower long term interest rates, a lower dollar, and further gains and equity prices.
We keep thinking that we'll add an inflection point and that you know, we'll get information I We've got the CPI and the FED this week, and that you know that will really tell the story, and then you know, nothing really changes all that much.
We just keep grinding higher.
I thought it was interesting that you had the big strategist from the biggest institutions all out on the same day today Goldman Sachs David Costin says he thinks the gains will continue because some of the other sectors besides tech will catch up. Morgan Stanley's Michael Wilson harkened back to the nineteen forties when the S and P five hundred rallied twenty four percent before then returning to a new low. And you also had Marko Kolanovitch over at
JP Morgan saying this is going to fall apart. The move higher in cyclical stocks is likely to prove fleeting, as many of the same arguments, the lag effect of the of the interest rate hikes and the fact that we've had so many already that that will threaten the economy.
And speaking of stocks that are particularly sensitive to the economy, look at energy today. Now we had the Goldman call we were talking about this yesterday on the program, with the cut in the forecast for Brent crude now about to eighty six bucks by December. By the way, this is the third time in the last six months that Goldman has revised lower its forecast for oil. Today in New York. This is not Brent, this is WTI. We
were down nearly four and a half percent. We closed around sixty seven to twelve, and that took with it that lower oil price took a lot of the energy stocks down as well.
And energy really hasn't rallied. I mean it's just kind of missed out on this bowl. It's one of the most underweight sectors. If you avoid recession, is that an area where you can play catchup. We'll have to wait and see.
Lot is still out there. It's time now for Global News.
Miami says it's ready to handle crowd control as Donald Trump surrenders to police tomorrow. At back to with Global News from the nine to sixty news room in San Francisco.
Ed, Yeah, right, Brian, they say they're ready. Authorities are downplaying any threats as well. Polite trief Manny Morales says no perceived crisis coming.
There has been a lot of post none that I'm aware that can cause any concern of any type of credibility. But make no mistake about it, we're taking this event extremely serious. We know that there is a potential of things taking a turn for the worst, but that's not the Miami Way.
And Mayor Francis Suarez says, Carrot and Stick.
Obviously believe in the constitution, believe that people should have the right to express themselves.
But we also believe in law.
And order, and we know that and we hope that tomorrow.
Will be peaceful.
Yeah, Meanwhile, reports are Donald Trump boarded his private jet for Florida earlier today alone now tomorrow, after the arrangement, Bloomberg's Nancy Cook says, Trump goes back to Bedminster for a rally.
What he's going to do around eight to fifteen at night is give remarks. I'm expecting those remarks to be shorter than the remarks he gave after his first indictment when the Manhattan DA indicted him. And then he's going to have a fundraiser at Bedminster. They're hoping to raise two million dollars, and his.
Legal team will be working on other potential indictments that could be coming down the pike. China today denying US claims that it is has spy operations in Cuba, Chinese Foreign Ministry sportsmen of Long Win Being saying that it is false information. Says over the past few days he's seen inconsistent information coming from the US. Now he is
right on the last point. The US has denied the Wall Street Journal report last week and yesterday admitted there were bases in Today, the US behind National Security Council Coordinator John Kirby went on the verbal offensive.
This is not a new development.
That China has been trying to achieve some intelligence gathering capabilities in Cuba and frankly elsewhere in hemisphere.
And defends the administration's reticence to talk about it, saying it does no good publicly and causes harm to talk about these kinds of sensitive matters in public. Meanwhile, Secretary of St. Anthony Blinkin today says the Trump administration did not do enough to counter the Chinese efforts to boost intelligence gathering overseas after discovering that Beijing was operating in
Cuba in twenty nineteen. And Blinka also says that China is not directly giving military aid to Russia at this point.
Today, we've not seen.
That line acrossed.
At the same time, we have concerns about private.
Companies, but says it is being closely monitored. Pennsylvania's governor has declared disaster in Philadelphia after the collapse seven of an I nine five overpass caused by a tanker fire, and the Transportation Secretary Pete Budachich there today says it has wide ranging effects.
This is not just about commutes, This is also about supply chains. About one hundred and fifty thousand vehicles a day and a good percentage of at its truckings.
And says all the way from Philadelphia up through New York, but also south to Washington, DC supply lines. New York City Police Commissioner Keyshaw Sewell is going to resign. There had been talked for the past several days that she had lost power and was having to clear all policy moves through Mayor Eric Adams office. She has sent out an email to her staff. Global News powered by more than twenty seven hundred journalists and analysts in over one
hundred and twenty countries in San Francisco. I'm Ed Baxter. This is Bloomberg.
I'm Brian Curtis, along with Rashad Salamat and our guest is Lamar vieer portfolio manager with Vier and Company, to take a look at markets. Lamar, thank you for joining us. Does it feel like people are chasing here a little bit?
Certainly in some sectors. I mean, we think what's the rebound in big tech has probably gone a little too far, a little too fast. But you know, we still think there are some pockets where you can get some quality a reasonable prices. So you got to got to kind of be picky and choosy as you look at the opportunities out there.
Absolutely, but you've got to be abso to be a cognizant of us some which are cheap for a reason.
Correct, that's right. No, we we definitely don't think you want to be buying into value traps, but there are you know, like I said, it's it's when you get the big tech to megacap guys, they've they've really just the pendulum has swung right back to what we would
argue is a little overheated. There's a lot of folks that will just buy those, or even just buy an index fund and not realize that they're buying a really a tech dominated fund and and really piling into some of the richer evaluations out there.
I mentioned the comment from Marko Kolonovich at JP Morgan about cyclical stocks that ultimately the gains will be fleeting, and that the lag effect of the of the rate hikes that we've already seen and the fact that we may see more. I mean, there's no, there's no notion. I don't think at the moment that we're stopping here pausing maybe, but do you agree with that or do you think that there is room for you know, there to be more bread than the market.
I think I'm more in team Goldman, I guess than team JP.
Morgan is okay, so you're a little positive then, yeah, exactly.
We think, you know, there's there's some room the rest of this year, and we're actually, uh, we we think there's still some good opportunities, specifically in the consumer sector. So we think the consumer from everything we're saying, you've got Wall Street on the one hand, terrified that the consumer is getting ready to fall apart, but every single bit of data we've seen has really been positive. So
you know, the Fed obviously has done some tightening. It looks like they're not going to do anything, uh you know, on Wednesday. But you know, we think that the consumer is strong and and you know, with with most of the data points that we're looking at, we think there's there's still some room to run and some decent opportunities.
And here I mean yes, if you look at the top ten industry groups on the S and P five hundred, consumer cyclicals and consumer staples and even discretionary and not amongst them, does that surprise you?
It does? But you know it's tough the way we categorize sectors we find to be less and less relevant. So you know, calling Apple a tech stock is fine, but it's arguably just as much or more of a consumer stock, So it becomes very arbitrary, especially like we said with big Tech. You know, is Netflix really a technology stock? I would argue it's more driven by consumer trends than what's going on in technology. So I think the consumer sector is a lot bigger than we're given a.
Credit if we do manage to avoid recession. You probably heard me mention with Doug a few moments ago that energy could prove an interesting bet in that it's underperformed.
Do you see it that way?
We're actually not very bold on energy, and partially that's because you know, the global supply is pretty high relative
to the demand. But but more importantly, you know, we we kind of tend to shy away from energy just because it's it is so difficult to predict what's going going with the prices of oil and gas, and it's we we think you're much better suited or much better off picking the things that are a little more predictable and where you can feel a little more comfortable in your in your bats is about.
You know, okay, that's energy. But on the other side of energies, of course, the decombonization. How does that inform some of your investment decisions.
Well, that that is definitely part of it. As you look at you know, the rise of the electric vehicles and so forth. There's there's certainly going to be a lot of pressure on demand down the road. Now, I think it's still going to be a while before that really has a meaningful impact, but it's being excited about the long term prospects. Yeah, it's a little cloudy.
This is Bloomberg Daybreak Asia, your morning brief on this story's making news from Hong Kong to Singapore and Wall Street.
Look for us on your podcast feed every day, on Apple, Spotify, and anywhere else you get your podcasts.
You can also listen live each day on Bloomberg eleven three to zero in New York, Bloomberg ninety nine to one in Washington, Bloomberg one oh sixty one in Boston, and Bloomberg nine sixty in San Francisco.
Our flagship New York station is also available on your Amazon Alexa devices. Just say Alexa Play Bloomberg eleven thirty plus.
Listen coast to coast on the Bloomberg Business app, Sirius XM Channel one nineteen, the iHeartRadio app, and on Bloomberg dot Com.
I'm Brian Curtis and I'm Doug Krisner. Join us again tomorrow for all the news you need to start your day right here on Bloomberg Daybreak Asia