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tv   Bloomberg Daybreak Australia  Bloomberg  June 8, 2022 6:00pm-7:00pm EDT

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haidi: a very good morning and welcome to daybreak australia. annabelle: we are counting down to asia's major market opens. shery: good evening from new york. the top stories this hour, the oecd follows the world in slashing global growth forecast, warning the world will pay a hefty price for the war in ukraine. haidi: u.s. stocks fall as oil continuesits relentless rise. shery: some analysts say hopes are premature. we are seeing u.s. features muted at the open but after the s&p 500 managed to lose ground for the first time in three sessions after we had meme
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stocks under pressure given the sec talking about overhauling market rules, a direct response to the wild trading we saw last year. we also had chipmakers under pressure. intel saying the current quarter not looking as great as expected. the energy sector, the only sector that stayed in the green for today. we continue to see the rally and wti prices in the asian session above $122 per barrel at the moment. we saw data out today that showed u.s. stockpiles falling. we're watching volatility in the treasury space. 10 year yields about the 3% level. take a look at this chart because every time we get to this level this bottom panel shows you how much pressure and volatility we have on stock markets. the big question is will we continue to see a sustained rally in the treasury space
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given recession risks or could we see also this selloff continue because of inflation expectations not to mention with worries about what the federal reserve will do. annabelle: yields in focus. seeing the new zealand 10-year hit a seven-year high. they start to sell debt it bought during is quantitive using program. a lot of concerns about hi-lo -- about high oil prices. risk-off trading in asia. new zealand coming off line and australian futures pointing to the downside. it is all about the yen. we heard from the boj yesterday sticking with easing monetary policy and reiterating a weaker yen is a net positive. we are seeing that reflected now in other yen crosses. this index tracks the yen's relative strength against other major g7 peers. the weakness we are seeing in the momentum could beat what drives the yen dollar past the 135 level.
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haidi: of course it remains when it comes to the inflation picture, we continue to monitor all of these stories that are continuing to see the fans of inflation being flamed. one of the most recent stories on kfc in australia having to replace let us in the -- lettuce in their burgers with kabbage instead. some interesting consumer-facing stories. we are still hearing from a number of analysts and policymakers, treasury secretary be in the latest saying cpi is likely to breach 6%, could potentially go well above that level. the problem is not whether goes above that level but how sticky it remains. secretary to the treasury said it could stay above 6% for quite some time. shery: inflation concerns leading to all sorts of speculation as to where the treasury space can go. we are talking about bridgewater
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announcing the 10 year yield could top 4%. the bullish ones saying yields could fall around 225. all to do with what is happening in inflation and growth forecasts. slower growth, recession risks, the key concern for treasury markets and traders. we have one more signal coming from the oecd. they see the war in ukraine taking a heavy toll on the global economy, causing slower growth, higher for longer inflation, and possibly lasting damage to supply chains. kathleen hays is here in new york with me. what is going to be the price for the global economy? kathleen: recession? no. that is the good news. a slower economy. but inflation. and that is one of the reasons the world slows down. oecd represents 38 countries around the world, mostly developed nations, but from europe, the u.s., north america, from asia. here is what they said in a
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statement on their website. the world is paying a heavy price for russia's war on ukraine. a humanitarian disaster killing thousands and forcing millions from their homes. when coupled with china's zero covid policy, the war has set the global economy on a course of slower growth and rising inflation, a situation not seen since the 1970's. so let's look at just how much they have slashed growth. no recession but a pretty substantial slowdown. global growth cut to 3% from 4.5% for 2020. u.s., not so bad, but not quite 4%. another very important point, they say the war in ukraine has quashed hopes to a quick end to supply driven bottlers. it does not just hurt
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manufacturers, it hurts consumers and prices. let's look at inflation quickly because they have doubled their inflation forecasts for the world. in the end they say the cost of living crisis will cause hardships. russia and ukraine make up 30% of weeks exports, 20% corn, fertilizer, and natural gas. it is definitely something that will hurt the world's poorest the most. haidi: given the surge in eurozone inflation, this is shaping up to be one of the most pivotable -- pivotable -- how much hawkish is to be expect? kathleen: the hawks would like to see a signal for a 50 basis point rate hike but christine lagarde likes to have a lot of forward guidance and so far that is what she has been doing. the guidance for this meeting is that they will signal a 25 basis point hike, consistent with what markets are looking for.
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maybe 25 basis points in july and then by september you will have a full 50 basis points. by october you have made a full 100 basis points of hikes hitting you well out of the -0.5%. they are also expected to announce june as the formal end of their asset purchase, bond buying purchase program. we will watch christine lagarde 's press conference closely. what they she signal? there is one more thing that will get a lot more conversation and that is fragmentation. the idea is it is you remove stimulus from bond purchases and we are seeing yields widening out. he may have to have a plan in place to do some special purchases to make the spreads from getting to wide and not fragmenting the eu to protect nations that have more problems maybe from the war, more indebtedness like italy. that will be another big topic.
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haidi: kathleen hays there. we will be watching with much anticipation and it comes to the ecb meeting. oil retaining gains after data shift dropped. gasoline stockpiles as well. u.s. natural gas prices tumbling after a fire broke out in texas. let's get more with julia penn's era. holding above the $122 a barrel level. what is the new outlook? >> it is crazy how much we have rallied recently. if we continue to rally past $123, $124 a barrel, we are going to go to 2008 highs. short-term we are going to see a tight market especially for the summer season where everyone is driving in the northern hemisphere. and the fact that there is a russian oil ban, there are not
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enough refined products in the market right now so it is tight supply. obviously we know opec is increased their output for the month of july and august but they have not been meeting quotas in the previous month so there is nothing to say they will meet them this month. short-term outlook is it will be tight and painful for consumers. shery: that could also be the case for natural gas because of that fire in texas. what do we know? julia: we don't know much about the fire in texas. do know the fact they had this -- and we have to keep an eye on that because natural gas as we know has been very volatile. so this is a very big deal. we are absolutely going to have to keep an eye on that for any further developments. shery: julia fanzeres there with the latest. let's turn to u.s. listed chinese stocks rallying for a third day in new york tracking a near 5% surge.
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this after china proved a second batch of videogames this year is raising hopes beijing's regulatory correct down on internet -- crackdown on internet firms could be softening. let's get more from garfield reynolds. i know there is a lot of positive sentiment about chinese 80 yards especially when you have yields rising in the u.s.. but i wonder how sustainable this is. it feels a lot like speculation about what authorities might do. garfield: yes. authorities are absolutely the key when it comes to any chinese sector and tech has been a particular focus. don't forget china tech faces potential headwinds from u.s. concerns in general about china technology and technology transfers. the other thing here is prices
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have come down so far from these shares that there does seem to have been a bottom put in over the last couple of months. the question is whether you can have a sustained rally and that is up to a couple things. one is, what is the chinese government going to do, and do we start to see the chinese economy recover from covid lockdowns? some encouraging signs there. if the economy recovers, that should bring more money back into chinese equities in general and tech shares are cheap it might make authorities more likely to be kinder if things look up on the economic front. haidi: garfield reynolds there. let's get over to su keenan with the first word headlines. su: we start with the sec, which has previewed sweeping changes to rules, including payment for
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order flow. commission chair gary gensler says retail investors boozer -- deserve a better deal. it appears to be their most direct response yet to last year's wild trading in so-called meme stocks. any revamp would set up a clash with equities trading including citadel and robin hood. >> right now, there is not a level playing field amongst the different parts of the markets. the wholesalers, the dark polls, the lid exchanges. it is not clear when such market concentration, and yes, with an uneven playing field, that our current national market system is as fair and as competitive as possible for investors. su: treasury secretary janet yellen says the u.s. is looking to reconfigure tariffs on chinese goods to make them more what she calls strategic. yellen says some of the existing tariffs inherited from the trump administration have hurt
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american consumers and businesses. she did not get a timeline on the potential changes beyond saying they may take place in coming weeks. australian is treasury secretary steven kennedy has warned that inflation is likely to hit 6% and could go well beyond that. kennedy told a group of economists that significant pressure on the wholesale electricity market has presented a new upside risk. australia's inflation is currently around 5.1%. price pressures prompted the rba to make a surprise half-point hike earlier this week. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm su keenan. this is bloomberg. shery: still ahead, we get more on the commodities outlook later this hour with fat prophets analyst david lennox. we will ask which assets he thinks will perform the best.
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plus, staff struggles at qantas. the airline is asking for help amid an overwhelming rebound in air travel. this is bloomberg. ♪
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>> we think the greatest risk by far as deflation. deflation cyclically. >> you are talking over a longer time horizon? >> i think this inventory issue highlights the cyclical reason we have been saying we think inflation will unravel. the secular deflation story is very powerful. shery: cathie wood speaking inclusively with bloomberg's ed ludlow. really not a lot of movement, but this after we had stocks falling for the first time in three sessions. s&p 500 was losing more than 1%. and really chipmakers leading declines. they were under pressure with the philadelphia semiconductor index down more than 2%. this, after intel said the
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current quarter was not going as well as they had expected. we continue to follow this stock after hours, which is extending declines by .1%. our next guest says it is a challenging market for active management. good to have you with us. it's really not surprising how challenging it is. you have good eco-data, you worry about inflation. you have bad eco-data, you worry about recession. how do you position when there is so much market uncertainty? >> we have to put this year's negative market moves into context. the downmarket we have seen so far this year we think could be just starting to price in the slowdown in economic growth, inflation, monetary tightening. on top of that we still have a war in europe. in terms of portfolio positioning, a few key things we are thinking about, the most important, stay nimble and
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flexible, raise cash where you can, and be prudent and cognizant of the trade-offs between liquidity and have a longer term horizon in terms of your portfolio. haidi: could chinese stocks also be appealing given that we are coming out perhaps from a covid zero policy? it seems restrictions are being lifted slowly. alifia: such a fascinating system we have seen in chinese markets to date. the csi 300 shed 15% this year but gained 2% over the last two days and it is up 4% since over week ago when shanghai for said it would begin loosening covered restrictions. and we are seeing more government stimulus. for example, china's cutting the new auto sales taxes almost 50%. again, trying to reduce some of the overhang we saw in tech companies. so we think investors who want to be in china should really be taking advantage of evaluations,
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but they have to target sectors government is supporting and remaining highly selective, and highly liquid for now. haidi: how much risk would you have to be willing to take on to go into china at the moment? what is the investor profile you are looking at for those who are willing to go in? alifia: we have investors that are very long-term and they want diversified folios and we advocate diversified portfolios to reduce the amount of risk you are taking in your portfolio. we have seen that time and time again involve the market environments, diversification in your portfolio is key and part of diversification is diversification across geographies. yes, you are taking a risk by being invested in china but you are taking a risk investing anywhere in the world today and having a diversified portfolio across geographies, especially not ignoring one of the largest part of the global economy, we think is key over the longer-term. haidi: i have to say, i am wondering how much of that risk comes from the next earnings
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season. you say corporate earnings remains pretty robust. but in the coming quarters do we see the market punishing even decent reports, given that there seems to be such an overhang from the fears of recession and stagflation? alifia: i think second-quarter earnings are going to be another key data point that is going to really start to give us a little bit of a shape around where we are going in terms of these markets. but potentially adding to uncertainty around consumer demand. if you look at the last earnings season, despite high inflation, spending looked to be resilient, companies were optimal passing on price increases to consumers in a certain segment. a little all over the place, not clear trends. pepsi, dollar tree, williams-sonoma, all bullish on demand. you also saw some pockets of the corporate sector facing weakness. i think this mixed bag in terms of earnings is going to continue and we are going to continue to see companies facing supply
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shortages that are going to take a meaningful downturn in demand intentionally as we continue throughout this year. haidi: rocky -- broad creek managing director alifia doriwala joining us from washington. you can get a roundup of the stories you need to get your day going on your addition of daybreak at dayb . this is bloomberg. ♪
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shery: here's a quick check of the latest headlines. state street dropped the most in two months after they said they were looking to acquire credit suisse. their receipts declined by 1% wednesday. a swiss block reported that state street could make a good for credit suisse, citing a single person.
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state street said it is focused on its pending deal with brown brothers. credit suisse is said to be weighing a fresh round of job cuts, part of a renewed push to slash cuts. sources tell us it is considering cuts in divisions including investment banking and wealth management in multiple regions. the bank says it is expecting a third straight loss this quarter, driven by a slump at its trading division. qantas is asking head office staff to step in and help overworked ground crew at its low cost jet star carrier. staff have been asked to assist during the peak july period. like other airlines, qantas is struggling to cope with the rebound and travel. haidi: let's look at the day ahead for australia and new zealand. this is what we are watching when it comes to these markets. rbnz releasing details of the
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unwinding of kiwi bond purchases. sales start in july at a rate of five billion kiwi dollars per fiscal year and continue until on holdings reaches zero in mid-2027. we're seeing the 10 years -- 10-year new zealand higher. also watching comments from the treasury secretary saying it could go well above 6% and could stay there. woodside energy also tripping surging oil and gas prices to years of insufficient investment in the energy industry. the ceo said she expects prices to remain high but long-term investment will help the price outlook. shery: looking at the commodities space, we're seeing wti continuing its gain, up .2% above the $122 a barrel. it is a relentless rise, and this really fueling inflation
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concerns. data here in the u.s. showing the inventories have dropped again. we continue to see u.s. natural gas under pressure, this of course after that fire broke out at that texas export terminal. the fire is said to be under control at the moment. one of seven to export u.s. natural gas via sea. we're seeing gasoline futures still above the 421 level. and copper, we have also continued to see that rally, especially with base metals, given perhaps a recovery in a chinese manufacturing sector. all to do of course with the commodity squeeze, with the war in ukraine, and russian sanctions on crude rocking markets. we will discuss. th another crazy day? of course—you're a cio in 2022. but you're ready. because you've got the next generation in global secure networking from comcast business. with fully integrated security solutions all in one place. so you're covered.
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>> we do expect oil prices will
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come off these highs, but obviously the near term factors are continuing to be tight and supply is continuing to be tight. and one of the things that is going to challenge the industry as we have been under investing for the past few years, so we do need to continue with investment and that will take a bit of time. it will take more time. >> the fact of the matter is that u.s. exports are combined exports of crude oil and petroleum -- that would make the u.s. the largest liquids provider in the world. bigger than russia, bigger than saudi arabia. one companies had to look away from russia for diesel, they went to the u.s. when companies had to look for crude oil, they went to the u.s. our inventories came down, giving a misleading impression that the whole world was going down on the inventory side the same with the u.s. is. haidi: some guests talking about
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the surge we see in oil prices. the u.s. dollar is still hovering at 20 year highs against its peers. problems emerging for everyone outside of america. no commodity more important in crude when it comes to that correlation. let's discuss the risk the wider commodity markets with david lennox. great to have you with us. do you see that fx impact, or is it the supply and demand dynamic of oil that is overbearing? david: you have to look at both of them combined. u.s. dollar staying stubbornly high, and thateping any real strong rallies that we are seeing in commodity prices in check. then when you look at what is happening in the commodities space, we're seeing those rallies and that is on the back of the supply demand equation, especially in oil. we are well aware what is happening in ukraine, well aware of embargoes coming into place there and how they will be extended over the rest of the year.
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with europe. but as your previous guest just mentioned, the u.s. is really the outlier when it comes to controlling, we think, prices. u.s. domestic production still has a significant way to go before they get anywhere near their peaks. if we can see the oil price staying at these levels, then we are going to see that marginal cost in the u.s. improving, and that will see more production coming out of that country. haidi: does that mean the broader commodities complex, is that a level of consolidation? i wanted to get your views on going to the end of the year. we have an mliv question that basically asks, which is the best performing commodity going into the end of the year and which do you think will be the worst? david: at this stage we have a good call for gold but we do not think it will be the best performer. you have to look into the base metals complex. we are looking at the likes of nickel especially, lithium, just slightly outside of the base metals complex. they are the two commodities we
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think will do very well over the course of the year. when you have a look at the longer term horizon for both of those commodities, there's significant change coming through in other areas that will impact the demand and you cannot ignore that. gold, we have been a gold bug. we thought it had touched 2100 this year. it has done that. we do not think it will be the outperformer commodity until, we now an year. haidi: what about geopolitical tensions affecting those prices? david: look, we are all well aware of what is happening in terms of ukraine and russia. that war has obviously dragged down a lot longer than russia expected it would and it is probably going to continue. that is going to really keep the commodity sector on the demand side supply-side high. then you have the offset of the u.s. dollar, and that is really what everyone is watching at the
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moment we are well aware of what is happening demand supply. the u.s. dollar has just been a difficult factor to try and bring into the equation. we thought it would fall for the metrics of rising debt and it has not and that is a problem. shery: where does the china demand picture weigh in here? you mentioned oil perhaps we could get more production here in the u.s., but also we are seeing the slow reopening of china. david: china reopening, if it goes back to a zero covid policy we have a problem. if it does reopen fairly normally like the rest of the world is doing, then we will see a surge from demand. we also have to remember, this year has to be the best drive time have seen in the u.s., so we are going to see short-term fluctuations in the oil price to the upside until we see this season pass and then we will probably go back to more traditional levels. short-term price hikes in the oil price that once we see it go
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by we expect to see easing in the man from the u.s. and with that, lower prices. haidi: what are you looking for within commodities trade in particular that will give you an indication of how strongly reopening might be? david: we will be looking to see what they are doing in the iron ore space. that is a key commodity in terms of what we are seeing happening across the broader global economy. seeing infrastructure rippling out to the broader economy not just in one year but over the next three or four years. if we see strong iron ore demand it means the industry is still in good shape and that really is an indication of how the rest of the real world is probably operating at the moment. so we are looking closely at the iron ore numbers. haidi: you are talking about the likes of lithium, everything that goes into the making of a battery, and for the transition to the green economy. what do you make of the investment cycle at the moment? david: i think what your previous guests have been saying
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is dead right. we have seen underinvestment but only for a couple years. that is not because the money was not there, it is because the labor was not there. everything shut down. so that means there is some catch up to currently supply through new projects. those projects are going to take a couple years to come to fruition. so that is where we are at, in that gap period. you are also well aware that when we see significant prices, everybody goes out and starts looking for the stuff. that is what we are seeing happening at the moment. all those marginal projects, i prices, now not so marginal. of course they are getting turned back on, but they are going to take three to five years to get anywhere near production. haidi: david, always great to have you with us. appreciate your time. shery: david lennox joining us from sydney. let's now get to the first word news with su keenan. su: we start with the oecd,
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which slashes its outlook for global growth this year to 3% from 4% to 5% it predicted in december. they say the world economy will pay a hefty price for the wharton ukraine with weaker growth, stronger inflation, and long-lasting damage to supply chains. chief economist said governments must take immediate steps. >> as far as monetary policy is concerned, we have still healthy growth, employment, and high inflation. so what we are seeing is we move some monetary policy accommodation. monetary policy as you very well know cannot risk supply shock it will signal that will target this by telegraphing what they are doing. in those countries where there is obvious excess demand, then yes, monetary policy should be tighter. su: to thailand, and their central bank is signaling an increase in their benchmark
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interest rate after keeping policy unchanged in its latest meeting. the bank of thailand says it will assess the right timing for gradual policy normalization with headline inflation expected to increase and remain elevated. in a split decision, policy makers voted to keep rates at a record low 0.5%. an investigation is underway after a fire broke out at its export terminal in texas. a company spokesperson says the blaze has been brought under control. there were no injuries or risks into the surrounding chinext. -- surrounding community. it could have a significant impact on global's lies of fuel. a man arrested outside u.s. supreme court justice brett kavanaugh's palm while allegedly armed with a pistol and knife is now facing federal attempted murder charges. a court filing says the 26-year-old from california told detectives he wanted to kill kavanaugh, and believed the
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justice would vote to loosen gun controls in a pending supreme court decision. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm su keenan. this is bloomberg. shery: coming up, cathie wood says inflation and high interest rates have hurt her fund's performance. our exclusive interview, next. this is bloomberg. ♪
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haidi: take a look at what we are seeing in australia and new zealand. new zealand already at the highest since 2015. we are watching that next level at around 3.95 and an eight year high after that. australian the yield, we're seeing a bit of a move. this, as we see the dropping on wednesday but we should see an extension of that when it comes to the 10 year. pretty close to top of the april high. also looking at about eight year highs when it comes to the 10 year. we heard from barclays that the rba's willingness to frontload policy normalization may see the selloff peak in the third quarter. in new zealand though, we're watching the yield play there after we saw the rbnz start bond
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sales and say it would start selling off debt it bought during the quantitative easing program. the kiwi dollar largely unchanged and the aussie dollar holding steady at just shy of $.72 u.s. shery: we have an alert. south korea saying they will make all efforts to stabilize prices according to the finance minister, who is speaking at a meeting saying they will announce the government's economic policy direction next week. that will reform rules, taxes, to revitalize company's activities. south korean cpi has topped 5% for the first time in 17 years. he said inflation is likely to remain in the 5% level for some time. so they will make all out to stabilize prices. of course this inflation pressure not being helped by a weaker korean won that was expected against the u.s. dollar. let's turn to morning calls
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because we have another call on another currency weakness we are seeing. this time on the japanese yen. what are you seeing? annabelle: a lot of speculation around how far the yen fall against the dollar. capital economics has a call out saying it could reach 140 over the coming months. this is due to the policy divergence between the boj and the fed but speculation as to what could stop or stem the slide is some intervention and capital economics saying the bar for that is high. we are unlikely to see it unless there is a sharp fall from here. that is where we will be discussing weakness in the yen spreading to other currencies. you can take a look at our basket of the yen against g10 peers. you can see the slump is not confined to the dollar. seven-year low against other g10 peers. haidi: of course we continue to track rally recovery in china
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tech shares. are we seeing this as being a broad-based story? annabelle: not really according to bloomberg intelligence. they have been diving into the data to see who could be the biggest winners and they come up with bilibili. it is a video sharing platform seen as china's answer to youtube. it could be one of the biggest beneficiaries. the reason bloomberg intelligence is saying this is because they have been looking at the types of titles china has been approving and they are manly ones from smaller developers. that makes up about one third of what bilibili distributes on the platform. you can see the performance we have seen of bilibili over the past year clearly has a lot of room to catch up with those sorts of declines. but bloomberg intelligence saying it puts ahead of netease and tencent. shery: let's stick with the tech sector because cathie wood is defending her performance following a steep drawdown in assets, with investors fleeing amid a job of more than 50% in
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their flagship fund. we spoke to wood at the up summit in arkansas. cathie: if you look at our flagship's performance from the low in covid to the peak in february of 2021, that was 360% increase. innovation solves problems. we had a lot of problems through the coronavirus. we were rewarded accordingly. since then, peak to trough. down 75%. why? inflation and interest rates. and it is really interesting to be near walmart territory because we are learning a lot from retailers now. inventories, yes. so the fear of rising interest rates and inflation out of control has gripped the market.
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that is the equity market. if you look at the fixed income market, it does not agree with that. the 10 year treasury bond yield is 3%. that instrument should be one of the most responsive to inflation fears. 3% suggests gdp growth 3%, 4% the next 10 years. it is not being corroborated by fixed income markets, and i do not think we are in a period where we cannot extricate ourselves from this. the inventory stories are a very good example of why inflation has become a problem. the scrambling to bring more and more inventory to satisfy demand, stay-at-home demand, went into overdrive, and i believe the narrative in the last year, inflation, gave purchasing managers this idea that, ok, what is the worst that could happen if i build inventories. the worst that could happen is i
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am able to deliver inventory profits, sell at a higher price. that is not going to happen. that is not going to happen. i have never seen inventory surges like this in my career and i have been around for a long time. 33% at walmart, 42% at target, 74% -- no, 50% at kohl's. very broad-based. we are going to see a lot of discounting. what is beginning to happen now, up the margin. our strategy is now starting to outperform the rest of the market. i have never been in a market for the market has gone to new highs and we are getting lows. i have never been in a market. and it has not been supported by the fixed income market. so we will see what happens. haidi: cathie wood speaking exclusively with ed ludlow. next, qantas is scrambling for
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more staff as the flying kangaroo gets caught up in the resurgence in travel demand. this is bloomberg. ♪
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shery: as the world grappled with the fast-moving spread of
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covid in early 2020, singapore airlines executives realized bold action was needed for the carrier to survive. the ceo told us exclusively about the difficult decisions that had to be made. >> it has indeed been unprecedented for the airline industry and singapore airlines especially, given that we have no domestic market. just to give some statistics, in january of 2020 we were carrying about 3.4 million people. by the time we reached april we were only carrying 11,000 people. huge drop. our capacity was about 3% of pre-covid. it was a very, very tough time, because as an airline, we do burn quite a bit of cash. we still need to maintain our plans, pay staff, and all that. cash burning was about $300
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million to $400 million a month. haslinda: what has been the biggest challenge of the last two years? goh: at the beginning it is to ensure we have enough cash to survive. i certainly do not want to see singapore airlines declaring bankruptcy and so forth. that is one. fortunately we were able to address that quite early and provide confidence by the financial markets in general. the second thing, which i would say is the most painful decision that i had to make, is about letting go of people. we had to let go almost 2000 people. it was very painful. we tried to delay as much as possible, we reduced the number as much as possible.
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haidi: you can catch that full exclusive interview only on bloomberg television. that is at 9:30 p.m. thursday sydney time. qantas is asking head office employees to step into front-line roles to support ground staff as the airline struggles to keep up with resurge in travel demand. so how severe is the labor market situation when it comes to qantas? paul: it is severe. we have travel almost back to pre-pandemic levels but staffing is nowhere near close to that. ground handling staff in particular are stretched in sydney, melbourne, and brisbane, and the school holiday peak is approaching at the end of the month. qantas sent in emailed to its staff titled, airport's peak contingency plan, which sounds very formal, but contained a plea saying literally, we need your help. it is asking for volunteers to
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come join the frontline, handing out water bottles to cueing passengers, tracking down lost baggage, helping out with security checks, that sort of thing. it did something similar last time there was a travel peak in easter. shery: what about the airports, how are they coping? paul: also not particularly well. sydney airport lost about 15,000 staff during the pandemic has been furiously hiring them back in recent times. still about 5000 staff short. over 800 organizations. sydney airport is now going to hold a jobs fair next thursday 40 organizations there encouraging applications, hiring on the spot, particular areas of need include retail, government services, terminal services. this is similar to what the china airport did last month, holding a jobs fair and getting people to apply for jobs while they were waiting. about 40 of sydney airport's
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largest employers will be there, and coincidentally, that is the same day australia's unemployment data will come out, which is apparently at a record low, 3.9%. shery: here's a quick check on the latest business flash headlines. the uber ceo says the company is recession resistant, with consumer spending remaining robust despite fears of an economic slump. the ride-hailing giant also does not see a need for job cuts, even as market volatility and the prospect of a global recession loom over technology companies. >> we do not think they are necessary at all. however, with the uncertain environment out there, we should be more cautious. there is much more uncertainty as you look forward six to 12 months. my message to our employee basis, we are going to be careful. we feel really good about the business and the trends, but let's not get carried away. shery: brookfield is in advance
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talks to sell its stake to mitsui. the transaction is sent to value trapac at about $2 billion including debt. the company was founded as a subsidiary more than 35 years ago. it has operations in the ports of los angeles and oakland, and jacksonville, florida. haidi: next in the next hour of daybreak, we have a discussion on the investment opportunities that have arisen amid the simultaneous rise in rates and credit spreads widening. plus, cba tells me how they are spent in japan's current account to have a greater influence as the yen tumble continues. that is it for daybreak australia. daybreak asia is next. this is bloomberg. ♪
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