Good morning.
I'm Nathan Hager and I'm Karen Moscow.
Here are the stories we're following today, big tech earnings.
They will once again be the theme for markets this week, and the Nasdaq will be in the spotlight after Friday's nearly two percent surge, and as we hear from two of the biggest tech companies. Bloomberg's John Tucker has a preview.
Apple and Amazon are both scheduled or report quarterly results after the closing bill on Thursday. Investors will be watching for more about Apple asking supplies to keep iPhone shipments flat year on year. We're also hearing Apple expects revenue to grow through price hikes for iPhone Pro models. Apple's resilience on Chinese manufacturing also of concern because of souring relations between Washington and Beijing, and investors will likely be
interested in anything that Apple says about AI. As for Amazon, Bloomberg Intelligences watch to see if strength in streaming and advertising will be offset by slowing consumer and enterprise spending. Also, anything about online shopping and Amazon's push in the pharmacy and grocery will be of interest. In New York. I'm John Tucker, Bloomberg debreak.
All right, John, thanks well. Earnings are also very much in focus overseas, and that has Heinegan investors crying in their beer this morning with the detls from Bloomberg's You and Pots in London.
You and good morning, Good.
Morning, Karon Nathan. First half operating profits slumping twenty two percent on an adjusted basis. At Heineken, the world's second largest brother, reporting beer volumes dropping more than expected after its biggest price hikes in a decade. This as it struggles to pass on high raw material costs to consumers without driving them to cheaper brands. Hiderking shareholders waking up to a nasty hangover this morning, with shares down as
much as six and a half percent. More widely, we're two thirds of the way through European earning season, and according to research from Bloomberg Intelligence, fifty percent of companies have so far beaten consensus. In London, I'm une Pots, Bloomberg daybreak.
Okay, ewan, thank you. Staying in Europe, Italy's economy unexpectedly contracted in the second quarters. Domestic product shrank by three tenths of one percent from the previous three months. That's much worse than the zero growth analysts surveyed by Bloomberg had expected.
Well Back here in the US, Nathan, the big economic event comes on Friday with the July job support. Meantime, economic heavyweights are weighing in on where US growth growth goes from here. Minneapolis Fed President Neilkashkari says right hikes will probably result in job losses and slower growth, and that makes him optimistic on the fight against inflation.
Overall.
I think that the inflation outlook is quite positive, that it should be slowly diminishing from here. But again, we've just continued to be surprised by the dynamics of this reopening economy, and so we can't prejudge it. We have to let the data actually guide us.
Minneapolis Fed President neilkash Carey made the comments on Face the Nation from CBS Sketch the program every Sunday on Bloomberg Radio Nan Time.
In Asia, Karen Central Banking dominated the overnight trading session thanks to a surprise move from the Bank of Japan. The boj has stepped into the bond markets with unscheduled purchases to bring down yields. That's after Japanese yields hit their highest level in nine years. Bloomberg's Paul Dobson says, the bank is clearly sending a message.
You know, the BJA is trying to tell us something with this move. And what I think it's trying to tell us is this doesn't want a kind of you know, unseemly dash for the exit here. It doesn't want to see a lot of volatility in the bond market. It doesn't want to see us out one percent yields tomorrow, even though it's said that okay, they can go up towards that level.
Bloomberg's Paul Dobson says there is no clarity as to when the bog might intervene again, and the yen has weakened on the news that is currently trading at one forty two point four to three against the dollar.
Wellly, economic data from China is also in focus. Nathan economic activity loss more steam in July is manufacturing contracted in the services sector weekend that has traders expecting more stimulus measures from the government. Bloomberg's Rebecca Chewing that Wilkins has more from Hong Kong.
Certainly sort of pessimistic tone in terms of the data itself, but that's quite a contrast with what we've seen in the market's response, and market's really betting on the promise of policy support here. We still haven't seen many concrete,
tangible moves. But again, in a way, this sort of weak of data that we're seeing coming out of China reinforcing the expectations that policy makers will have to take more comprehensive actions, particularly after we've seen this sort of duvish, this tilt and more duvish tone.
Bloomberg's re Becca Chewing Milkins says stocks in China rose more than a half of a percent overnight.
In corporate news, Karen Walmart has paid one point four billion dollars to buy Tiger Global Management's remaining stake in Flip cart. The transaction values the Indian e commerce jand at thirty five billion dollars. That's according to a letter sent by Tiger to investors that was obtained by Bloomberg News.
Well, we're also keeping an Aya Mattel this morning. Nathan Barbie once again the number one movie in the country, earning another ninety three million dollars in its second weekend. Christopher Nolans Oppenheimer remains in second, earning another forty six point two million.
And in political news, Karen Umer President Donald Trumps super pac says it's legal bills are piling up. Bloomberg z Ed Baxter has the story.
With a number of charges against Donald Trump and the Maral Logo classified information case growing to forty His fundraising pack Save America is due to announce today it has spent forty point two million dollars on legal costs just in the first half of the year.
The group has.
Already begun calling back donations it has made to other action committees, and there's concern that this will really dent the spending the group can do to try to get candidates elected in San Francisco. I'm at Baxter Bloomberg Daybreak.
Time now to take a look at some of the other stories making news in New York and around the world with Bloomberg's Michael Barr.
Good morning, Michael, Good morning, Nathan rip Currents on New York beaches that have claimed the lives of two teenagers in the past week. Off Coney Island, a fifteen year old boy was discovered late Saturday night after getting caught in a current. Thursday, afternoon while playing with his younger brother in an area under red flag warnings. Another massive search at Jacob Rhese Beach in Queens on Friday after a rip current took under a teenage swimmer, identifying a
body as nineteen year old Amadu Tim. Hours later, this man spotted the body.
Just kept seeing like a little shadow of the water and we got close up with my flash, lay on it and it was him.
According to the National Weather Service, rip currents are the third leading cause of weather related deaths. Ukraine is apparently intensifying its drone strikes on Russian soil, hitting targets in Moscow. Meanwhile, Russia backed Ukraine's second largest city, Kerkiev, overnight as heavy battles were reported around a score of locations. Kiev says Ukraine will begin talks with the United States this week about security guarantees the US will make to Ukraine, while
its application to NATO remains pending. Former US Ambassador to Ukraine, Stephen Pfeiffer says the Ukraine wants to join NATO because membership comes with military protection.
I think there's a belief in Ukraine which is correct that if Ukraine were in fact anchored in NATO, the Russians would not attack, and so we're looking really, I think, beyond this current roar.
The chief of staff for Ukraine's president also said officials from a number of countries are preparing to meet in Saudi Arabia to discuss a peace plan for Ukraine that
would hinge on the departure of all Russian troops. Senate majority the leader, Chuck Schumer, is urging the House to include the fendof Fentanyl Act and its Defense bill when members return in September, Calling this a breakthrough moment in the Fentanel crisis, The Democrat from New York says the act will dramatically cut the amount of fentanyl coming into the New York area and the rest of the country. The bill would allow.
The President to declare a state of emergency and put tough sanctions on China for sending US the precursor chemicals and Mexico for making those chemicals into fentoel.
The legislation is part of the bipartisan Defense bill passed by the Senate last week. Global News twenty four hours a day, powered by more than twenty seven hundred journalists nanalysts in over one hundred and twenty countries.
I'm Michael Barr.
This is Bloomberg, Nathan.
Thank you, Michael.
Time now for the Bloomberg Sports up Day. Good morning, John stash How.
Good morning Nathan. Aaron Judge back playing for the Yankees. Hit a home run Saturday, and yet not in the lineup last night in Baltimore, not even as a DH A lot of people wondering why. As it turned out, hardly mattered, not when Louis Severino's giving up seven runs in the first inning and the Orioles went on to win nine to three, and Severnino, who in his first seven seasons with the Yanks only once had an ERA of more than three and a half, now has an
ERA of seven and a half. This was his fourth start where he had allowed at least seven runs. The only good news for the Yankees the Astros, Blue Jays, and Red Sox, who are all ahead of them in the wildcard chase, all also lost. Mets one beat the Nationals at City Field five to two. Career win number two fifty for Justin Verlander, who was then asked about his future in New York in light of the Mets recent trades of Max Scherzer and David Robertson.
When you see that happen, you know you can't help but think. You know what's what's in store for next year, and you know we played this game to win. You want to win a championship and you want to you don't have the opportunity to do so, So changed my opinion a little bit.
Yeah, Mets GM Billy Effler insists the Mets recent moves are not a fire sales shures are traded to Texas. The Rangers have now also acquired the X Yankee Jordan Montgomery from Saint Louis. Aaron Rodgers coming to the defense of his Jets offensive coreator Nathaniel Hacket the last year as the head coach in Denver, a job that now belongs to Sean Payton, who recently said Hackett last year
did the worst coaching job in NFL history. Rodgers, who's close to Hacket for their time in Green Bay, called Peyton insecure. Jets play the Browns Thursday in Canton, Ohio. Zach Wilson will start a quarterback Rodgers as expected, and will not be John Stashellwerd Bloomberg.
Sports from Coast to Coast from New York to San Francisco, Boston to Washington, DC, nationwide on Syrias exam, the Bloomberg Business app and Bloomberg dot Com.
This is Bloomberg Daybreak.
Good morning, I'm Nathan Hager at the start of another very busy week in the markets. We have about a third of S and P five hundred listed companies reporting earnings this week. Apple and Amazon will be the big ones to watch later on in the week. Traders could also be looking for more clues on the policy path with the first of two monthly jobs reports before the
fed's next decision in September. Lots to discuss this morning with Dennis Gardman, the former publisher of the Gartman Letter now chairman of the University of acron Endowment Investment Committee. And Dennis is here with us now. Good morning, Thanks for being here. So it has been a tech driven rally that has dominated this year. Ken earnings continue to power stocks hired.
Dennis, that's a good question, and it's a question beyond my canaida. At this point, I have been surprised by the strength of the stock market, to be quite honest, shocked, to be even more blunt. It has surprised me beyond belief. The fact that we've got the CNN Fair and Greed Index has gotten to eighty five. That's actually dropped a little bit, but the put call ratio is historically low. The fact that the leading economic indicators have fallen below
the coincident indicators. All of these things are indicative of a market that is overbought and do for a substantive slide. But nonetheless the market continues to go higher and earnings continue to beat on most instances. So I'm surprised, I'm shocked, I'm stunned, and I'm wrong. But am I going to
go and be a buyer of stocks at this level? No, it's a way beyond anybody's wildless imagination as to where they have war stocks could go, and I will stand on the sidelines and watch from the sidelines.
Well, we did get some I guess rationalisation on this rally this morning from Mike Wilson, who's also been pretty bearish, the analyst of Morgan Stanley. He's comparing what we've seen this year to twenty nineteen, calling it policy driven late cycle phenomenon. Could that be a possible justification for you as well?
It's very much a justification. Clearly, there has been governmental policies that have been incumbent in the strength of the stock market. But most important, I guess it's the amount of cash that's been sitting upon the s or that was sitting upon the sidelines, a lot of which has been put into the market in the past several weeks, several months. But yeah, it's been policy driven, it's been
earnings driven. Man strangely enough, it's been economically driven. The economy has proven to be far more resilient, far stronger than I had thought it would be. But nonetheless, I'll go with history and say that as long as the leading economic indicators continue to fall below the coincidence, as long as the put call ratio continues to be as low as it is, and as long as the CNN and greed index continues to be as high as it is,
I'll either stand upon the sidelines or be short. I'm modestly short in my own account, and the objective word here is modestly.
How do you expect policy to go at this point when we have seen continued strength in the economic data, and at the same time we continue to hear policy makers like Neil Cashcari just yesterday leaving open the possibility of yet more rate hikes.
I've always thought that once we get to five and a quarter five and a half, that would probably be about the end of it. When I first when the FED began the process of raising interest rates almost a year and a half ago, I wrote at that time that what we have to remember is historically the Fed, once they changed policy and move from to a new direction, take rates much farther for a longer period of time than anybody wants to anticipate. When we were at zero,
I said, we go to five percent. Who was laughable at the time. Here we are at five and a quarter five and a half. Maybe there's one more tightening to be incumbent in the set of reserve, but I have my doubts as to whether that's likely or not. Time only shall tell. We'll see what happens with the next two employment numbers that are coming out, the first
one coming out this week. I haven't done my work yet to figure out what I'm going to anticipate for the non farm payrolls number, but it's probably going to
be a high number. There's probably one more, maybe at most two more increases in the overnight said funds rate, But the market is already looking towards the easying monetary policy, and that's not going to happen until very late in twenty twenty four, maybe even twenty twenty five, before the Fed begins the policy of reducing the overnight said funds rate.
Got about a minute left here, Dennis. We did get another surprise overnight from the Bank of Japan with this bond buying intervention. Do you see a read through to the US market from what the boj is doing.
It's for the first time in a very long period of time that the BOG is actually tightening monetary policy slightly. They're going to be I think the term that mister used was flex They're going to be flexible and allowing rates to go higher. But Japan, being one of the largest buyers of the mess of US debt securities, if they're going to be allowing rates to go hire over there, they're going to be allowing rates to go high over here as money comes out of the United States and
moves to Japan at the margin. So it's not supportive of the US bond market.
This is Bloomberg Daybreak today. Your morning brief on the stories making news from Wall Street to Washington and beyond.
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