Good morning. It's Friday, the twenty seventh of October in London. This is the Bloomberg Daybreak Euroate podcast. I'm Stephen Carroll. Coming up today, American forces strike Iran linked targets in Syria as Tehran warns the US won't be spared if the Israel Hamas war spreads. The ECB's decision to hold rate steady delivers relief to a highly indebted Italy, but for how long? And a forty K cut at one of the Big Four EY slashes UK partner payouts as
economic uncertainty grows. Let's start with a roundup of our top stories. The United States says it hit two facilities in eastern Syria it believes were used by Iran's Islamic Revolutionary Guard following repeated attacks on US forces in the region. The strikes come as Iran's foreign minister warned the US won't be spared if the war between Israel and Hamas spreads. Meanwhile, the United Nations Security Council failed to reach an agreement
on calling for a humanitarian ceasefire in Gaza. Francis U and Ambassador Nicolade rivieer Is dismayed the.
Security Council is stock is very disappointing. We should get back to negotiation, do a compromise, prioritize humanitarian access, this humanity and pause while recognizing the right of Israel to defund itself.
Nicolad Riviev spoke as the Israeli army reportedly made further overnight ground raids into northern Gaza following wednesday nights limited incursion with infantry and tanks reports from Gaza's health ministry. Gaza's Hamas run Health Ministry says seven thousand people have now been killed in air strikes on the territory. Katar's senior hostage negotiator has warned that an escalation in the conflict will hamper efforts to secure the safe release of captives.
The country's Minister of State, Mohammad al Kulafi, says all civilian hostages in Gaza can be released in the coming days, but a pause in the fighting is needed.
If there's a continuing bombing, our task is getting more difficult. The mediators need a period of calm, a situation where we can speak easily to both parts and try to be more creative in bringing more initiatives that can get those civilians out.
Those comments from Katar's senior hostage negotiator come as Israel's military said it had killed Hamas's deputy head of intelligence in an airstrike on Gaza. In a statement, the Israel Defense Forces said that Shaddi Barud was one of the key figures behind the October seventh attacks that killed fourteen
hundred people. To other News Now and the European Central Bank has left interest rates unchanged for the first time in more than a year, following last month's knife edge decision to lift the rate to a record four percent. Policymakers kept it there on Thursday, and ECB president Christine Leagald says markets shouldn't expect them to come down from there anytime soon.
We are determined to ensure that inflation returns to our two percent medium term target in a timely manner. Based on our current we consider that the key ECB interest rates are at levels that maintain for a sufficiently long duration will make a substantial contribution to this goal.
Christine Laguard also insisted the Central Bank didn't even discuss a faster windown of its pandemic bond buying program. The comments offer a welcome relief to Italy at a time when investors are wondering if the country could soon be cut to junk as borrowing costs on its massive national debt soar. Janet Yellen says the surge in treasury yields is tied to the strength of the economy rather than
the widening fiscal deficit. The US Treasury secretary Toel Bloomberg, bond prices touching levels not seen since the financial crisis is a reflection of consumer resilience.
We're seeing yields go up in most advanced countries. Part of the increase in yields, I think is simply a reflection of the strength of the economy, the notion and that interest rates will be higher for longer.
Yellen's view clashes with some bond market participants, who pointed the sharp increase in the American government's deficit as a cause of the jump in yields the after third course. After third quarter US growth came in at four point nine percent, the top US financial official said she wouldn't be surprised if the US posts at growth rate of two and a half percent for twenty twenty three. Amazon
dot Com reported quarterly revenue the topped analyst estimates. The story now from Bloomberg's Charlie Palace.
Amazon got a lift from rising sales in its retail and cloud computing units. Revenue gained thirteen percent to one hundred forty three point one billion dollars during the three months ending September thirtieth. Analysts, on average estimated one hundred forty one point six billion. According to data compiled by Bloomberg, Amazon shares have increased more than forty percent this year thanks to fading recession fore and CEO Andy Jesse's determination
to rain in pandemic era spending and boost profits. In New York Charlie Pellett Bloomberg.
Radio, shares in Intel have jumped out of the chip maker predicted a return to sales growth this quarter. Intel's forecasting sales for the period will be a head of analyst estimates between fourteen point six and fifteen point six billion dollars. The company says the PC market is through
the worst of a historic slump. The firm also reported that it's now winning new customers for its outsourced manufacturing division, and Ernst and Young partners in the UK saw their share of profits drop for the first time in three years. The forty thousand pound cut is the latest in a wave of economic uncertainty hitting the big four audit firms. Ewan Potts has more with few ideals to advise on
and clients cutting costs. Accountants of feeling the pinch Ey's UK division and recently cut five percent of jobs in financial services and now they're shrinking their two hundred and twenty million pounds bonus pool by thirty percent. The big four accounting firms are also facing increased scrutiny over the quality of their audits after a series of high profile collapses, including Karellion and batisri Valery in London.
I'm your in pots Bloomberg Radio.
Those are your top stories on the markets. The MSCI Asia Pacific Index is one point one percent now, excuse me, it's one percent higher now. Eurostocks fifty futures are at by three tenths of one percent, and the tenure treasure yield as a basis point higher this morning at four point eighty six percent. Let's get more detail on the rising regional tensions in the Middle East over the Israel Hamas War, Iran's foreign minister warning the US won't escape
unaffected if the conflict spreads. This after the White House said they sent a direct message to Tehran warning against targeting US military personnel and the region, and we've been learning about more strikes on Syria targets in Syria linked to around this morning to our AMA and News director in Roslin Mathison is with us in studio for more. Good morning to you, raz Let's start with this apparent rationing up of tensions between the US and Iran and
learning of more strikes on Syria targets too. What can you tell us, Well.
That's right. What we know is the US says that struck several sites inside Syria, that it said we're being used by Iran's Islamic Revolutionary Guard. That says we've seen an escalation in attacks on US troops in the region. I mean, it's not unusual for there to be things like drone strikes and so on on US bases in the area, but there has been a pick up in that in recent weeks, obviously since the Hamas attack on Israel. You do have a lot of US military assets in
the region and that's only increasing. And we know, of course that US warships shot down several missiles fired a week or so ago by Huthy rebels out of Yemen, seemingly aimed somewhere north. And we know there's been an escalation, as I said, those drowne and other rocket attacks on US troops based in places like Iraq, and so we're seeing the little by little the sense the US is
being drawn into this somehow. Obviously there's no sense that US wants to get militarily involved in what's happening exactly inside Israel and Gaza. But there's lots of outfits operating in this region, lots of proxy groups operating in this region on behalf of Iran and other nations, and they're
obviously using this moment to test the boundaries here. And so the risk is that you just get a further pick up in these attacks on US soldiers and at some point you get a more significant one than we've seen so far.
And the rahtoric that we're hearing then from political leaders on this as well has also been stepped up. This warning from Iran's Phari Meers or the US won't escape unaffected. How significant is that?
Well, it's interesting, of course that they're saying this in the US warning around quite publicly. But the interesting also, it's just very clear that Iran and the US are kind of talking in back channel ways but also publicly to each other, and that's a bit unusual. The US normally keeps these communications very much to themselves and don't advertise them. And what they're saying is, yeah, we're in touch as much as we can with Iran and through
other channels potentially into Iran. And the messaging is the same, don't pull us into this thing, and don't get involved yourselves, because of course Iran again has its fingers in many, many proxies in the region, and they could come at the US in multiple ways, not just Hermas but of course Hesbola of course are the who theis in Yemen and more, and so very much a level of concern
about the risk of a broadening conflict. And so while you're getting those public statements of rhetoric and obviously sort of fell in fiery ratoric in return from Iran. Was interesting to me is it's quite clear that they're talking to each other about this at.
Least, yes, and we without for further developments as well. Meanwhile, Bloomberg has learned that Israel is looking for the help of spyware companies when it comes to tracking the hostages that are still in Gaza.
Well, that's right. It's quite interesting to learn that some of these spyware companies, including NSO which makes Pegasus spyware, which I'm sure many of us have heard of, they're enlisting these companies and their services to try and track the hostages that are in Gaza. And many of these companies are saying, yes, we'll give you our services for free, and maybe they can be involved in other aspects of
this conflict between Israel and Hamas. Of course, that's not necessarily without controversy though, because, as I said, the Pegasus software, that company is blacklisted by the US and other countries, as are other operators in that fielding you, a few years ago, there were revelations that this software had been sold to some fairly authoritarian regimes around the world, multiple countries, that we're using it potentially to spy on dissidents, on
journalists and so on, and so this company is not exactly without controversy, as I said, But right now it's spyware's proving quite useful, shall we say, in efforts to trying to locate these sausages at.
The same time, just back to the diplomacy for a moment, no agreement to the UN Security Council on a humanitarian cease far EU leaders agreeing to call for humanitarian corridors and pauses, and that was a very hard one compromise as well.
Well, that's right. It's interesting seeing this sort of word salad in essence that's going on. Is anyone willing to call it a cease fire? It doesn't seem so, because that might have bigger connotations. But essentially what they're doing is sort of trying to get a cease far a pause in fighting that if you were to call it that, including the aerial bombardment that's been going on by both sides, Israel into Gaza and Hamas is still sort of firing
rockets at Israel. The idea, as you say, is to get enough of a break to allow more of the humanitarian aid to go in. So there's no suggestion that any kind of pause slash ceaspire would be a long one, or how long it might go for, or that it would stop a potential ground invasion of Israel. It's certainly none of that it's just simply to allow some of their aid potentially to get through.
This is Bloomberg Daybreak Europe, your morning brief on the stories making news from London to Wall Street and beyond. Look for us on your podcast feed every morning, on Apple, Spotify and anywhere you get your podcasts. You can also listen live each morning on London Dab Radio, the Bloomberg Business app, and Bloomberg dot Com. Our flagship New York station, is also available on your Amazon Alexa device. Just say
Alexa play Bloomberg eleven thirty. I'm Stephen Carroll. Join us again tomorrow for all the news you need to start your day right here on Bloomberg day Break Europe