From the Bloomberg Interactive Brokers Studios. This is Bloomberg day Break for Wednesday, April twenty six.
Coming up today, Microsoft shares sore as Cloud growth Fuels earnings.
Alphabet also on the rise as Google Weather's the economic downturn.
First Republic malls a huge asset sale and an attempt to shore up its balance sheet.
And House Speaker Kevin McCarthy moves ahead with a vote on the death ceiling.
Witnesses are expected to take the stand today and Donald Trump's civil trial. Plus the isis leader behind a twenty twenty one attack that killed thirteen US service members as dead. I'm Michael Barr.
More ahead, I'm John Stasharon Sports.
The Mets and Yankees lost the Islanders one to keep their scenes it alive.
The next played Game five in Cleveland tonight.
That's all straight ahead on Bloomberg day Break, The business news you need to starn your day in just one fifteen minute podcast each morning on Apples, Spotify, the Bloomberg Business Appen everywhere you get your podcasts.
Good morning, I'm Nathan Hager.
And I'm Karen Moscow. Here are the stories we're following today.
The rise in Nasdaq futures follows solid earnings from two tech giants. We got to start with Microsoft this morning. Those shares are up seven and a half percent. Profit and sales beat estimates, and Microsoft gave an upbeat forecast for its artificial intelligence business. We get more from Bloomberg tech reporter Aggie Cantrill.
It's also about the investment that they made in open AI. A big part of that investment when they announced it was about integrating artificial intelligence into the suite of services provided by zero and so that's also a core part of Microsoft's plan going forward is essentially saying how their latest investments in AI are still going to be relevant to the suite of services they already provide.
Bloomberg's Aggie Cantrell says revenue climbed more than thirty percent in Microsoft's closely watched as Zeri cloud computing business.
Hey Nathan, Shares of Alphabet are up three quarters of a percent this morning. That company search business whether the economic downturn. With ad sales beating estimates. Alphabet's cloud unit also turned a profit for the first time, but that hasn't stopped the company from cutting jobs. In here CFO Ruth Poorad.
In terms of the outlook for headcount for the year, as we shared last quarter, we are meaningfully slowing the pace of hiring in twenty twenty three, while still investing in priority areas, particularly for top engineering and technical talent.
CFO Ruth poor At and Alphabet leadership has been cutting costs to preserve profit margins. The company cut about twelve thousand positions in January.
And of course, the tech earnings continue today, Karen. With Facebook parent Meta Platforms reporting this afternoon, let's get a preview now from Bloomberg's Tom Busby Well.
These results are from the first quarter of what Meta CEO Mark Zuckerberg called the Year of Efficiency at the company and for investors, one focus of today's report will be the impact of what's forecast to be a pretty sizeable drop in digital ad revenue. Also, of note the effect of several rounds of layoffs at the company. Thousands of workers have been eliminated, and a new focus away
from the metaverse and instead artificial intelligence and chatbots. Consensus calls for earnings per share of two dollars and one cent revenue of twenty seven point six to seven billion dollars, with three billion active monthly users. Tom Busby Bloomberg Daybreak. All right, Tom, thanks well.
Regional banks are in the spotlight again today we're seeing diverging paths for two specific companies, and we get the details from Bloomberg's John Tucker.
John, good morning.
It's a tale of two banks, Karen. After weeks of calm, First Republic's warning on deposit outflows, it reignited concerns about the health of the regional banking system. Its shares plunged forty nine percent, and then the worries eased somewhat after pack West Bank course that its deposits rebounded a First Republic is exploring an asset sale of up to one hundred billion dollars of mortgages and securities as part of a rescue plan. On the other hand, Pack West Bank
course saying things stabilized. Pack West has been taking steps to short up liquidity after selling off some assets. It says liquidity is reaching more normal levels, where the company's shares jumping sixteen percent pre market and a measure of calm may have returned to the sector. Live in New York. I'm John Tucker, Bloomberg Day Break.
Well John.
Since the collapse of Silicon Valley Bank. Hedge funds have seen massive outflows, but the world's biggest hedge fund is defying that. Trend Man Group says its clients brought in a net one point one billion dollars in the first quarter. The hedge fund industry as a whole saw outflows a four point eight billion during the same period.
Well, Nathan, the San Francisco Fed is taking heat for the collapse of Silicon Valley Bank. It's now the target of criticism from at least two Republican legislators, and Bloomberg's Ed Baxter has the story.
Senator Ted Cruz and Representative Jim Jordan have sent a letter to San Francisco FED President Mary Daily. Cruz on Bloomberg's balance of power says, the Fed has to be awake to what's happening around it.
Why the San Francisco Fed was essentially a sleep with the wheel. The San Francisco Fed is who had supervisory responsibility for Silicon Valley Bank. The duration risks on these bonds was evident on the face of it.
Crew says the attitude that the Fed cannot be held responsible or answer to regulation is not right. In San Francisco. I'm at Baxter Bloomberg.
Daybreak, all right, and thanks. So we spoke with ten crews about a number of subjects, including the debt ceiling battle on Capitol Hill. Stay tuned for more of that conversation coming up shortly on Bloomberg day Break.
And when it comes to that debt ceiling debate, careen, it looks like House Speaker Kevin McCarthy is moving ahead with a vote on his plan. Amy Morris has more from our Bloomberg ninety nine one newsroom in Washington.
The bill links the debt ceiling increase to spending cuts, but there are deep divisions within the Republican Party that threatened to sink it. A handful of Republicans are withholding their support over rolling back at the all tax credits and work requirements, while moderate and ultra conservatives have said they just won't support it. The plan has been to hold the vote today, but even that's risk. If the bill does fail, the House Speaker loses strength in his
negotiating position and could possibly weaken his own speakership. The ultimate outcome of the vote might not be known until the role call happens in Washington. I maybe more as Bloomberg Daybreak.
All right, Amy, thank you all. US companies in China are growing more pessimistic about the relationship between the two countries. According to a survey from the American Chamber of Commerce in China, eighty seven percent of those responding are negative about US China ties. That's fourteen percentage points higher than the previous survey.
It's forty seven degrees in New York. It'll be partly sunny today. Chance for a shower this afternoon, going out to the low sixties. Few more showers possible tonight. Otherwise mostly cloudy. Heading down to a round fifty. Time now to take a look at some of the other stories making news in New York and around the world.
Good morning, Michael Barr.
Good morning, Nathan. Witnesses are expected to begin taking the stand today and former President Donald Trump's civil trial in New York. Writer E. Gene Carroll as accused Trump of sexual assault and defamation. Carol says Trump raped her in a department store dressing room in nineteen ninety six. Her lawyer told the jury fear and shame kept hers silent for decades. Trump's lawyers say that Carol is only out
for money and for politics, and denies attacking her. The White House announced that the isis K leader behind the twenty twenty one attack at the Kabbol Airport, resulting in the deaths of thirteen American service personnel in about one hundred and seventy Afghans has been killed by the Taliban. One of the dead was Marine staff Sergeant Taylor Hoover. His father just got a call from the Marine Corps. He spoke to CBS.
Does it matter to you whether or not it was the Taliban that apparently killed him?
More in the United States, I don't care who it was that killed him. It's one lass terrorist that we have to worry about.
Does it feel like justice to you?
To me, it won't be justice ever.
US military personnel but not involved in the operation, but had learned he was killed several weeks ago during a series of battles early this month in southern Afghanistan between the Teleiban and the Islamic State Group's affiliate. Fresh off of re election announcement, President Biden spoke to a crowd
of workers representing the building trade union. The President highlighting the passage of the infrastructure Bill, the inflation reduction Act and the American Rescue Plan to the National Association of Building Trades Union conference in Washington.
I make no apologies for me label the most pro union president American District.
I'm proud of him. I'm proud of it.
I really a Republicans have said that President Biden's COVID nineteen spending, among other things, has been reckless, and have unveiled their own spending plan that would slash many programs tied to the American Rescue Plan. Singapore executed a man today on charges of conspiring to traffic more than two pounds of cannabis. Global News twenty four hours a day, powered by more than twenty seven hundred journalist in over one hundred and twenty countries. Michael Barr, this is Bloomberg, Nathan.
Thank you, Michael. Time now for our Bloomberg Sports update. For that we bring in Johnston showing. Thanks Nathan.
The Yankees have hit their first slump three straight losses, four in the last five and then those four losses, they have scored a total of only five runs, not a single extra Mase hit, and a six to two loss at Minnesota. The Twins got two run overs in the sixth inning from Byron Buxton and Trevor Laarn first loss of the year for Nester Coretest. Tampa Bay did finally lose a home game for the first time this season.
They had been fourteen to zero, but in the Al East the Yanks in fourth place day game today in Minnesota at Cityfield, the Mets had only five hits against New Rochelle native Josiah Gray.
Washington won five nothing. The Mets have.
Also lost their last three, that is, since winning eight out of nine. The Islanders season not over yet. First period goal for Pierre Angwell, Rock Nelson Matthew Barzel both scored in the second. The Isles won three to two, cutting Carolina's lead to three to two. NBA playoffs Dead and Phoenix both with series ending Game five wins at home, but Boston blew a thirteen point lead lost to Atlanta Trey Young a game winning thirty footer with two seconds left.
The Celtics now lead three to Nixon. Cavs Game five tonight in Cleveland with a Knicks up three one. Aaron Rodgers with a lengthy social media post thankful for his eighteen years in Green Bay. Rogers now a Jet, their GM Joe Douglas made the.
Trade, Aaron's one of the one of the best quarterbacks to ever played this game, and to have an opportunity to add a player of that caliber, You're always gonna You're always gonna look into it and how it how it fits within within our culture, within our team.
Douglass called the Jets acquisition of Rogers historic. John stashiewa Bloomberg's Boy.
Live from coast to coast, from New York to San Francisco, Boston to Washington, d C. Nationwide on Sirius XM The Bloomberg Business.
I've been Bloomberg dot Com. This is Bloomberg Daybreak. Good morning. I'm Nathan Hager.
Ted Cruz says he wants answers from the San Francisco Federal Reserve Bank on the failure of Silicon Valley Bank. In a conversation with Bloomberg's Joe Matthew and Amory Hordern, the Republican from Texas discussed the letter that he and Ohio Congressman Jim Jordan sent to San Francisco Fed President Mary Daily. They also discussed the fight over the debt ceiling and who he might back for president in twenty twenty four. Let's bring you part of that conversation right now.
You write in this letter that President Daily essentially failed to answer your requests for information about svb's collapse. Did she reply at all, Senator what you say?
We've gotten a letter that just a dismissive response, but not a substantive response. Which is why I've teamed up with Jim Jordan, the chairman of the House Judiciary Committee, and I'm the ranking member of the Senate Commerce Committee, to engage in oversight and to examine why the San Francisco Fed was essentially asleep at the wheel. The San Francisco Fed is who had supervisory responsibility for Silicon Valley Bank.
The duration risks on these bonds was evident on the face of it, and yet the approach of the San Francisco Fed seems to be that oversight cannot be applied to it, that it doesn't have to respond to the American people, it doesn't have to respond to Congress, and the consequence was billions of dollars.
That went up in smoke because.
The regulators failed to catch this and do their job.
The Federal Reserve is now going to release an internal review.
They have about this collapse.
It's supposed to be do before May first, and it's coming out this Friday. Were you alerted to this or is the San Francisco FED potentially just saying to you wait for the Fed's review that's going to be out this week.
The problem is that the San Francisco FED and all of the branch offices of the FED have a long history of essentially ignoring congressional inquiry. And in fact, I've
joined together on bipartisan legislation along with Elizabeth Warren. Elizabeth and I don't agree on a lot of things, but we've joined together on this to subject these banks to FOIL requests so that they can be subject to oversight from Congress and subject to oversight from the public, because right now their attitude is that they can't or shouldn't be scrutinized, and I think that's the wrong attitude.
Who gets punished for this?
You saw the Biden administration step in and bail out the customers at Silicon Valley Bank, and they did that. I think many of those customers were politically well connected, political supporters of the president, and I got to say that leaves a lot of main street sitting behind wondering, well, what happens if I don't have a lobbyist with stroke in this White House? And we need to have clear standards that apply, that are transparent, And I'm really concerned
about the fallout. In particular, I'm concerned that we're seeing a flight of capital away from community banks, away from mid size banks, to the giant banks, and I think that's really harmful.
Senator.
The other big story, of course, our viewers are focused on, is the debt ceiling. And in your book, and you're opening chapter, you talk about this clean debt ceiling that was going to be orchestrated to their Obama administration, but no Republicans one of their fingerprints on it. Do you think if McCarthy and Biden can't reach a deal, set Republican leaders need to make sure that the country lifts the debt ceiling.
The Biden White House's position right now I think is wildly unreasonable. Go back to the year two thousand and the year two thousand, you know what our national debt was, It was just five trillion dollars.
Then what happened. George W.
Bush became president and in eight years, our national debt doubled from five trillion to ten trillion. In two thousand and eight, Barack Obama became president, and in the next eight years, our national debt doubled again, from ten trillion dollars to twenty trillion dollars. So it took forty two two presidents over two hundred years to build up five trillion in debt, and two presidents quadruple the debt in just sixteen years. We're now at about thirty two trillion dollars.
What we're doing is irresponsible, and I think it is critically important for leaders in the House and leaders in the Senate to force real spending reforms. Now, let me be clear, under no circumstances should the United States default on our debt. And there's one person on planet Earth who could make that one hundred percent certainty, that's Joe Biden. A responsible president would say we will never default on
our debt. But Biden doesn't want to do that because he wants to scare monger and threaten a default rather than negotiate and actually address this out of control spending and debt.
Joe Biden is saying, you want to see a budget, and then he's willing to negotiate. The president has announced his reelection, When are you going to announce who you support? And is at the former President Trump?
Look, I'm running for reelection for Senate in the state of Texas in twenty twenty four.
I'm focused on reelection.
This is Bloomberg Daybreak Today, your morning brief on the stories making news from Wall Street to Washington and beyond.
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