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Good morning.
I'm Nathan Hager and I'm Karen Moscow. Here are the stories we're following today, Karen.
Investors are still reacting to the messaging from j Powell. The Fed chair is keeping helps alive for an interest rate cut this year, while acknowledging a burst of inflation has reduced policymakers confidence the price pressures are easing, though Powell did signal that a rate hike is not in the cards.
I do think it's clear that policy is restrictive, and we believe over time it will be sufficiently restrictive. That will be a question that the data will have to answer. I think it's unlikely that the next policy rate move will be a hike.
Jay Powell's message was clear to former New York Fed President and current Bloomberg opinion columnist Bill Dudley.
The whole game plan is basically unchanged. We're going to keep rates here until we're highly confident that we're going to hit inflation down at two percent. No hint whatsoever of a great hike, no hint that it's not going to work. So mark reaction, I think was pretty appropriate given what he said, He basically said, we've got it.
Former New York Fed President William Dudley says Jay Powell's comments reinforced the higher for longer narrative over the medium term.
Well, Nathan, The attention now turns to earnings, with Apple reporting after the closing bill. Let me get our preview from Bloomberg's Tom Busby.
Analysts expect another decline in revenue for the fifth time in as many quarters, mostly on a sharp slowdown in China because of its luggish economy, a ban on using the iPhone at official government jobs, and a lot more competition in the smartphone market from Chinese rivals. Today's results will also be the first official look at sales of its thirty five hundred dollars Vision Pro mixed reality headset, not expected to be a major source of revenue anytime soon.
Consensus calls for revenue of ninety point three three billion dollars, iPhone sales still making up about half that total earnings of a dollar fifty share. Tom Buzzby, Bloomberg Radio. All right, Tom, thank you now.
We want to get you up to date on the protests still playing out on college campuses across the country. Police moved in on this Tenton Cambin at Fordham University yesterday and arrested fifteen people for trespassing. In California, UCLA suspended Wednesday classes after police and riot gear moved in on a pro Palestinian camp that put up pepper spray on counter demonstrators who tried to break them up. This professor brought Vencott says it's like nothing he's ever seen.
I've been in many protests over the course of my life. I've never seen anything like this. I've never seen students being physically attacked by a huge crowd.
And all this follows hundreds of arrest Tuesday night at Columbia University and City College of New York. The Associated Press has counted more than sixteen hundred arrests at thirty schools since the protests began at Columbia two weeks ago.
Oh well, Nathan, we turned down to legal news. Out of Arizona, the state Senate has voted to repeal a Civil War era law that would make nearly all abortions a crime. We get more from Bloomberg's Ed Baxter.
After the Senate passage, it just needs the governor's signature. And Katie Hobbs has supported it all along and posted right after the vote, we are going to get rid of this awful law once and for all. Democratic State Senator Evil Birch says it is time.
I don't want us honoring laws about women written during a time when women were forbidden from voting because their voices were considered inferior to men.
When the process is done, Arizona will revert to the prior law which allows abortion up to fifteen weeks of pregnancy. At Baxter Bloomberg Radio, all right.
Ed, thank you.
Turning back to markets, it has been quite a voliable day in currencies. The yen in Japan slid as much as one point one percent against the dollar, after having surged up to three percent late yesterday. Bloomberg News Executive editor for Asian Markets Paul says there are signs the Japanese government made a move.
The evidence suggests that it's a second intervention by the authorities this week, a second attempt to stop the yen from continuing with this weakening puff. The problem that they face is almost immediately once that was over, the weakening began again. The trend is very much for a weekly yen, and so the impact or the influence that the authorities can have is is going to be tested. At the very least.
Bloomberg's Paul Dobson notes we'll only know for sure when the government confirms any FX action, but an analysis of Bank of Japan pounds by Bloomberg News does point to an intervention of about three and a half trillion yen.
Well in Europe, Nathan shares of Shell are at more than one percent, And for a recap of the oil giant's latest profit report and a look at some other key earnings, we bring in Bloomberg's Ew and Pots in London.
You good morning, Karen. Nathan. Shell is keeping up the pace of share buybacks three and a half billion dollars worth in the second quarter. This is the oil John saw profits drop lesson expected in the previous quarter. And there's another buyback in the banking sector. Shares in IG, the biggest lender in the Netherlands, jumping after profit beat and on a new two and a half billion euro
buyback and earning some of Europe's most valuable company. Today's drugmaker Novo Nordisk It says sales of its weight loss treatment will go V more than doubled in the first quarter, but it's facing both supply constraints and pricing pressure. In London, I'm une Potsplin, bog.
Radio, Okay you and thank you.
Checking some stocks on the move. Here in the US, we're watching shares of Qualcom. They are up more than four and a half percent. Of the world's biggest seller of smartphone process Who's, gave an up beat forecast for sales and profit in the current period. Analysts say that suggests demand for handsets is increasing after a two year slump.
On the flip side, shares of fastly plunging more than thirty two percent. The infrastructure software company lowered its full year projections for revenue and profit, and.
To coin a phrase Karen DoorDash is not delivering for investors this morning, that stock is down three thirteen percent. The largest food delivery service in the country offered a disappointing profit forecast for this quarter.
Shares a Carvana Nathan surging up thirty five percent. The used car retailer, once on the brink of bankruptcy, posted a surprise profit and revenue that toped analyst estimates.
And one other note in the auto industry. Karen, we know Tesla's cutting headcount by more than ten percent around the world. The latest victims of the cost cutting are summer in turns. More from Bloomberg's Doug Prisner.
Tesla is rescinding offers just weeks before internships were set to start. One student said his start date was three weeks away, and he'd already spent thousands on housing. It's near the end of the school year. With little time to find replacement gigs for the summer, the aspiring Tesla interns took to LinkedIn and appeal to other employers. In one instance, a current Tesla employee ask her own virtual LinkedIn network to step up and nab one of the interns.
The post read, please make our loss your gain. In New York, I'm deg prisoner Bloomberg Radio.
All right, Doug, thank you, and it's time now for a look at some of the other stories making news in New York and around the world. For that were joined by Bloomberg's and Michael Barr Michael, good Morning, Good.
Morning, Karen. Mayor Eric Adams praise the NYPDE after the arrests of about three hundred people at Columbia University and City College of New York. It comes two weeks after the pro Palestinian protests first started.
These external actors with a history of escalating situations and trying to create chaos, not to peacefully protest, but create chaos.
Adams went on to say the NYPD's precision policing ensure that the operation was organized, calm, and that there were no injuries or violent clashes. Donald Trump faces additional sanctions in his hush money trial as he returns to court today for another contempt hearing followed by testimony. Prosecutors are seeking thousand dollars fines for each of four comments by Trump that they say violated a judge's gag order barring him from attacking witnesses, jurors, and others close to the case.
That is on top of a nine thousand dollars fine the judge imposed on Tuesday related to nine separate gag order violations. During a campaign stopped yesterday. On a court off day, Trump and Freeland Michigan focused on the judgments against him.
The judge, by the way, is the most conflicted person in the history. I don't think there's ever been a more conflicted judge.
Crookeet and conflicted.
Trump also campaigned in Wisconsin. Manhattan prosecutors are asking for a September retrial for Harvey Weinstein. More from Bloomberg's Charlie Pellant.
It was the disgraced movie mogul's first court appearance since his twenty twenty rape conviction was overturned by an appeals court last week. Prosecutor Nicole Blomberg told the judge that one of Weinstein's accusers is prepared to testify again. She suggested locking in a date after Labor Day. The seventy two year old, who has cardiac issues and diabetes, has been in a hospital since his return to the city jail system Friday from an upstate prison in New York. Charlie Pellett Bloomberg.
Radio President Joe Biden will expand two national monuments in California today, protecting nearly one hundred twenty thousand additional acres from development. It's part of a White House gold to designate more in land and water for conservation than any previous administration. The bulk of the newly protected land will enlarge the San Gabriel Mountains National Monument. Global News twenty four hours a day and whenever you want it with the Bloomberg News. Now, I'm Michael Barr, and this is.
Bloomberg Karen, Larry, Michaelbarr, thank you time now for the Bloomberg Sports Update with John stash Hour. John, good morning.
You don't want to Karen.
When the Nickson Sixers played previously in this series in Philadelphia, six erstar Joel mb lamented that there were Sony Nick fans in attendance, figures to be more of the same tonight, for Game six doesn't tip off until nine o'clock. Nick Stilly the series three to two, but Philly comes off that comeback overtime Game five winning New York tyrees. Maxi
hit two three pointers in the last thirty seconds. The NBA says the first one should not have counted that he should have been called for traveling two blowouts last night, Celtics finished off the injury riddled Heat scored forty one points in the first quarter of the route was on Boston one one eighteen to eighty four, won the series four to one. Dallas over the Clippers in LA one twenty three to ninety three. Luk At Donsi despite a knee injury and feeling ill, scored thirty five and the
MAVs go home up three too. Edmonton Oilers, moving on, beat the Kings four to three, took the series in five. Dallas top Vegas three to two. Stars were down to nothing, now they're up three to two. Mets ho's to the Cubs Yankees in Baltimore. A total of only three runs scored combined in the two games. Mets lost one nothing. All teams had five hits. The Mets blank by Shota Imanaga, the Cub's thirty year old lefty import from Japan. He's now five to oher with an ERA of zero point
seven eight. Yankees and Orioles one swing provided all the runs.
Here's Capreman and the pitch is whacked down the right field lineman. If it's fair, it's gone, and it is gone. A whole run just inside the foul pole down the right field line haswago. Caprera gets to Corbin Burns but two Ron.
Homer WFA n Yanks one two nothing. Luis Heel gave up to US two hits the five out save for Clay Holmes's tenth. He's unscored upon in fifteen outings. Mets and Yankees both the day games today. Four straight win for the Red Sox fet the Giant sixty two Nationals back to five hundred and one nothing to win to Texas the eight and shut out the Pirates.
John Stash, Edward Bloomberg Sports, Karen and Nathan.
Coast to Coast on Bloomberg Radio nationwide on Sirius XM, and around the world on Bloomberg dot Com and the Bloomberg Business app. This is this Bloomberg Daybreak.
Good morning. I'm Nathan Hager. Higher for longer. It is still the mantra from the Federal Reserve after the sixth straight pause in interest rates from the Central Bank, but Chair J. Powin company are keeping hope alive that they could deliver a rate cut this year, though that hope might not quite be conviction. For more on the decision and the market reaction, Let's bring in Bloomberg's pretty Koopta.
Good morning, Critty. It seemed like the takeaway for me at least was that the Fed isn't quite there yet on inflation, but it feels like it's getting there. Was that the takeaway for you.
At least they attempted to tell that message.
They also said that, look that they're having that last mile argument where it's always going to be tougher to kind of root out the inflation as you get closer and closer to the target. And that's a statement that not only the FED has made, but central banks around the world as well.
What's really interesting is they're basically saying.
That the hikes are off the table with the hire's a higher bar to hike in the context is everything here, Nathan, because you remember those comments from John Williams and New York Fed president who said if the data supports it, they would consider a hike. Now that wasn't his base case, of course, but he's just kind of stated the obvious, and the markets really took that as weight. Hold On a second, do we need to put a hike back
on the table chair? Powell really threw some cold water on that idea, saying, actually, no, we are still kind of in a easier mindset at least, and that seems
to perhaps be it. And he didn't just do it from his commentary, Nathan, He did it I thought kind of an interesting way from his QT policy and then I say his but I mean the FEDS of course, where you are starting to see a little bit of a deceleration in those in that qtigue starting in June, and that in itself, even though it is still quantitative tightening, is relatively easier in terms of the policy itself.
Although it was interesting for Powell to note that the slow down in the quantitative easing doesn't necessarily mean that that's a change in there thinking about when it comes to interest rate policies, really trying to keep those two separate.
And we should clarify for a global audience when we're talking about this decrease in quantity of tightening. We're going from out sixty billion dollars a month of just letting kind of maturities roll off the balance sheet to about twenty five billion dollars a month.
So it is significant, but again.
It's not like actively selling bonds on the market. It is still a continuation of their ongoing policy. But you're one hundred percent right that they separated that from the interest rate story. What's important is that they really took hikes off the table, and I thought Alberto Gallo actually tweeted about this from over at Andromeda Capital and said
it quite beautifully. In terms of what to pay attention to He says, keeping front end rates high while tapering QT is like pulling the handbrake while pushing the accelerator pedal. So the commentary you've heard off the back of Chair Powell's presser has simply been is this the FED trying to guide the markets and saying, well, actually, you guys have gotten ahead of yourself. We're we have not deviated from what we've been saying for the past couple of months.
It was really interesting as well to see that sort of whipsaw reaction when the Chairman took the idea of rate hikes off the table, only for the higher for longer message to sync in. I wonder if we're going to get more market whip sawing when the focus turns right back to big tech earnings after the bell when Apple reports.
I'm sure we will.
I mean, I thought it was interesting about the stock market reaction. We'll put the bond market on the side for a second. Is that the stock market was selling off way ahead of Chair Pow. It's almost like they anticipated what he was going to say. And it was an interesting because it was initially a positive that a hike wasn't coming, but then a negative that a cut was getting perhaps pushed further and further out, at least in terms of pricing in the bond market. Big tech
earnings could change all that. Apple in particular, of course a big piece of the focus.
Now.
It's important to keep in mind, Nathan, that Apple shares and the S and P five hundred, just given it is the biggest weight in the index, have tracked very very closely. It's even driven the S and P five hundred to those record highs. But lately the stock has been diverging from what the index has done as a whole. Lot of that do to some of that China weakness. The question after the bell today will be does that continue.
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