yvonne: -- >> good morning and welcome to daybreak era. a new year hangover contains one of the weakest starts to a year for stocks and bonds in over a decade. it could signal one of the last year's rally was indeed overdone. geopolitics, hamas says israel has killed a senior leader in a beirut explosion, raising new concern about escalation in the region. to save time, the shipping giant stops using a red sea until further notice. tesla loses the top spot for global ev sales to byd, failing to outsell the chinese automaker when it comes to the fourth-quarter deliveries. a lot to digest, we will dive into all of it. quick check on the markets. when you are looking at the risk off vibe, it's pretty natural. january has been a fairly weak

month, in -- it feels like the grinch came early in that seasonality is kicking in quite quickly. it might have to do with the fact we are seeing the best gains in the s&p 500 2023 going back several years. it speaks that optimism was overdone. kick off the new year with a lot of caution. that's the message coming from the sea of red. go across assets. the monetary policy story still matters. it is closed today for a holiday, that early treasury won't be as prevalent but when you look at bond futures you are seeing a debt -- a bid. they are really met with the defensive bid in the safest asset in the world which is the u.s. treasuries. that move lower bond futures aligning with what you're seeing

in the bloomberg dollar. strength going into the euro, strength into the pound. brent crude again, in line with a re-sentiment, down 1/10 of 1%. not a major market move but the cross asset story on the equity story speaks to what narrative, which is, get your money off the table, ease into 2024. we will see how those asian markets are faring. avril hong is standing by in singapore. are you seeing the same thing in asia? avril: money off the table in the asia-pacific markets. the gauge of stocks in the region. msci asia-pacific excluding japan, almost all of the sectors slumping, infotech leading the kleins. bonds, currencies also sliding. even the south korean and australia gauges eked out the highest close since the middle of 2022, pulling back today. it's really about the uncertainty related to the fed.

uncertainty related to geopolitics. let's take a look at chinese markets because yesterday they caught a head start with the worst start for chinese stocks since 2019, today extending losses, even the pboc statement yesterday that there was $50 billion last month, pumped in by a low-cost funding to policy oriented banks. that's not helping to lift sentiment. in the past few days we've got the chinese manufacturing pmi's divergence between official as well as the ties in the private survey. still, no hope in that regard for the recovery. that is really dogging the market sentiment. let's flip the board because the other sector we are really focusing on is the chinese tech stock. tech is down today, the likes of tencent and net ease on the back of a reuters report of a top official that oversees the

division that looks after gaming regulations in the country has been fired. this is a week and a half after we saw those gaming curbs coming through, sparking an 80 billion dollar market rout. the implication in suggestion is that maybe that was not the chinese authorities intention. let's flip the board again because we are looking at the adani stocks. stocks for the adani group and companies climbing today. this is on the back of top court verdict coming from the india supreme court, saying no special investigation is needed for adani. this is related to the hindenburg case amid the allegations of a short selling and market manipulation as well as fraud. to be clear, what we see in these stocks is something we saw ahead of that verdict. that's your look at asia markets. kriti: a really interesting read through that you were seeing on the global story, but also that

independent india story. avril hong, thank you for walking through it. i have some of the analysis. she was talking about the shipping of the geopolitics having a ripple effect around the world. hamas now saying israel has killed one of its senior leaders in an explosion in beirut. lebanese media saying it is really drone struck an apartment building in the capital killing the deputy head of the hamas politburo at five other people. israel has not confirmed it was behind the attack. joining us is patrick sykes, joining us from istanbul. can you give us more information on this beirut last? what does it actually mean when it comes to the conflict? >> i think the bottom line is it's an expansion of the lebanese front in the conflict. until now, that front has been confined to the border areas between lebanon and israel's -- israel. smalltime clashes between hezbollah on the lebanese side in israel on the other.

they been operating on the circle of rules of engagement where they limit themselves to tit-for-tat operations. this is israel, allegedly, taking out a senior hamas leader in the capital of lebanon, far away from the border. a kind of attack like that hasn't happened since the 2006 war between hezbollah and israel. i think it's an expansion of that front away from gaza itself. and bodes ill for the region as a whole. kriti: at the same time, your point about the region as a whole, the red sea is capturing global attention as we wait for regional escalation to take full this it does. they are now saying they will stop letting their vessel sailed through the red sea. kenny walk us through the decision-making? >> they are a particularly large player, but every player in the

area will make the same risk calculation. we've seen this uptick in the houthi's in yemen targeting and attacking, sometimes successfully, shipping interests in the region. we've seen the u.s. trying to step in with the u.s. led force naval force to protect shipping, but the attacks have continued. we saw another attack overnight, that still going on. the latest factor they have to contend with is iran sending in one of its own warships. we know iran, in this conflict, largely as a proxy power, backing groups further away from its own center of orbit across the region. like hamas, like hezbollah. we had iran sending its own assets into the region. i think it's not a match for the kind of u.s. force that's also stationed there, but it is a statement of intent, and attempt to deter the u.s. and a message

to the shipping companies that these risks aren't going away anytime soon. kriti: certainly something that i think creates a lot of red flags when it comes to how you pricing the global trade stories. patrick joining us in istanbul. we thank you so much for joining us this morning. as he talked about the global readthrough from the shipping space. this is something i think when it comes to an investor standpoint is hard to price in. global shipping constraints means higher inflation while, this isn't being factored into monetary policy. this isn't being factored into monetary policy. they join us from bloomberg -- bloomberg's markets today team. we are talking about geopolitical tensions. when monetary policy is still in the limelight. >> at the moment they are almost separate. so at the moment, the red sea, what's happening there, the only real effect you are seeing on markets is there may be a little risks being priced in but the focus remains squarely on central banks.

i think oil is the only place you are seeing some volatility, but we saw yesterday that there was some volatility going early in the morning. by the afternoon it comes out again. at the moment i think the focus remains on central banks. kriti: it's worth mentioning with oil volatility if you compared to the trump tariffs or the aramco tax from the rebels, it's still a small move in the context that speaks to the geopolitical risk premium getting baked in. you talked about the idea that monetary policy is still where the focus is. jobs data on friday, how much of a change will it make in something that's already a trend that play? >> i think what you will be looking for is reiterating that devilish stamps. -- dovish stands. voters are less hawkish than last year, so the dovishness will likely be baked in. we have the jolts today, getting a couple of readings on that

very early in the air. will it change the picture, probably not. at the moment, there's no expectation that will be huge surprises. you never know. it would take a pretty significant one for there to be any kind of change in narrative of people looking very firmly at when is the first cut going to come. kriti: what might that surprise blind spot actually be? >> you would have to see a big upside or downside on the payroll on friday. that's a key area to watch. jobs really is preview to that but payroll data, you would have to be very significant. if you look at where pets are for the fed, they haven't moved a huge amount over the course of the last week, that dovish narrative of 2024 has been baked in. we need to be a significant surprise in either direction. kriti: it's something that will be factored into an -- to the

investor playbook. sam from bloomberg's market today team. we thank you for that immediate market analysis. i want to get to a couple more things on your docket. don't forget some of the fed speak we will get. 1:30 p.m., the fed will,. the minutes of the fomc is something we will watch. that coming up at 1:30 p.m. u.k. time. that jobs data is due 3:00 p.m. at 7:00 p.m. for the fomc minutes. the division you see when it comes to monetary policy is what we are looking for. is everybody on the hawkish stance low? is at higher for longer or are people softening to the idea of a rate cut? a full round up of the stories to get your day going and the addition of today's terminal. if you are a subscriber type in dayb on your bloomberg terminal and you will get the top stories. the market story in one of the really interesting dynamics you are seeing right here in the

u.k., how much pressure is the boe facing? we will dive into that next in the corporate space. coming up, a gearshift when it comes to the electric vehicle race as china's byd overtakes tesla. we will explore the road ahead for the sector when we return. this is bloomberg. ♪

kriti: why do you laugh? elong: have you seen the car? >> i have seeing far. i sought at the berkshire hathaway meeting. tell me why you're laughing. you don't see them as a competitor? elong: no. kriti: elon musk speaking to our

former colleague back in 2011 saying he does not see byd as a -- as a competitor. now getting outsmarted, outsold by them. he posted this in may last year saying their cars were highly competitive. it's really interesting now that we are seeing that tesla has been overtaken by byd and global ev sales for the for a first time in history. despite tesla delivering more vehicles and expected in the fourth quarter. it reflects the growing influence in the automotive industry. for more we are joined by our our asia transport reporter. he is going to walk us through this interesting dynamic. few look at some of these numbers, for example, coming out of the chinese ev makers, they didn't outperform either. he saw pressure in those stocks and they still beat tesla, how? >> when you look at the numbers

game, part of the numbers include pricing and how these ev makers have been very aggressive on pricing. but you have to look back to the start of last year when elon musk and tesla really played that price cut playbook and really got out in front of the competitors, particularly in the china market, which is the biggest ev sales market. when you look at the numbers just from overnight, tesla still delighted investors by beating expectations in the fourth quarter selling 484,500 ev units were delivering on that. and then on the more important for your figure, 1.8 million deliveries. in that is still a bit of a disappointment when you look at what elon musk had been saying and what he said at the start of last year, he could sell up to 2 million ev units. this is on the low end of those expectations. you look at how tesla really played out last year, they still

cut prices. they still couldn't stir the demand that it wanted, and elon musk was also frustrated. the high interest rates were really affecting how was trying to sell this particularly in the u.s.. kriti: elon musk famously saying it's affecting the tesla stock price, which he doesn't think he should be held accountable for. talk to us about the byd story in particular. this is the chinese automaker. most cells are coming from china. is this a global story or is this mostly a china story? danny: this is such a good question. by having such a success, a huge run in china, byd has been able to get to the very top here. and i think when you look at byd, they are not even in the u.s. market. when you compare that to tesla, it's got a far broader spread of

sales across many markets. byd is trying to change up that fact that it's been opening new markets, 60 markets and territories into years. already, it's the top seller in israel, thailand, and also brazil. it still has a long way to go but it's making waves already and undercutting tesla, more importantly. when you look at the future, particularly into 2024, because byd has been able to outsell tesla in the quarter, can it two-year -- do that on a four year basis, that will be key to watch. that's one metric and we will still see that valuation gap between tesla and byd. tesla is still on top, still earns more and generates more profitability. but they expect byd to close up revenue gap considerably by the end of this year. kriti: we will see if that happens, a lot of optimism around tesla and concern of

whether or not they are falling behind. just given the rapid growth you have seen. bricks danny lee from hong kong. i want to pivot to aviation news. airbus is working on an offer up to 1.8 billion euros for the debt -- data and cybersecurity unit of a's owes. that signing unidentified people with knowledge of the situation. they also have reportedly been interested in the business. they have not yet commented. sticking with stuff in the travel sector, air crash travel investigators in japan are searching for answers after a deadly runway collision killed five people. the crash in tokyo involved a plane setting and off on relief sown from the earthquakes own. here is our correspondent. can you give us the latest? >> i am standing on the fifth

floor of the airport at terminal two. we are standing here and have been here all morning because the runway behind me is where the collision happened last night around 6:00 p.m. local time in tokyo. there is still debris on the runway, and that is on purpose, because investigations are now underway, digging into the causes. as you can see behind me, this was a little speckle of black on my right shoulder, that is the debris. not that much to see. in airbus a350 900. it was a newer plane, cost $300 million. quite a big plane that went up in flames and what's left is just the wing and a bit of a tip. the 370 nine passengers that were on board this plane luckily survived the crash. they escaped through an emergency slide on the front of the plane. the first-hand accounts were talking about the heavy smoke that filled the cabin. the heat coming from the back of

the plane because of the fire and the panic that ensued. the 379 people on board including 12 crew members of japan airlines, were ok. on the flipside imagine the coast guard plane that it collided with five people, five crew were dead. one survived. that was the pilot. we are looking into the cause. the question everybody has on their minds is, how did this happen? investigators are discussing it with the pilot. it may have something to do with miss communication. more details are set to come out. kriti: the live images you are seeing from the damage are staggering. i've never seen anything like that. you can actually see the debris that she is speaking to live in tokyo as that cleanup project is underway. we thank you for that live in analysis. coming up on the program, we go

from tokyo to the continent of africa. ethiopia trains a state in its biggest airline for access to the red sea. but the move risks heightening tensions. stay with us. this is bloomberg. ♪

kriti: welcome back to daybreak europe. ethiopia has signed a deal with somaliland the breakaway region of somalia to gain access to the red sea in exchange for a stake in its flag carrier ethiopian airlines. the deal of them risking heightening tensions in a deal that's wracked with conflict. bring us up to speed with the deal, what do we know so far? >> what we know so far is that they have been able to gain see access through somaliland and

through the gulf of a in. this will allow them to build a military base and use it for commercial purposes for 50 years. also, ethiopia will release a 20 kilometers stretch which will be used by the ethiopian navy. they are at liberty to use it as one of their ports of entry. ethiopia will be able to do infrastructure in court or in somaliland. in exchange for value and they get a stake in an undisclosed date. ethiopian airlines. ethiopia gets it as a sovereign state. they will be the first country to do so in this place into the greater picture of amassing international recognition so they can source for aid. >> talk about why somalia's denouncing the agreement. it sounds like it's a win win. >> it's a win-win for some ali in ethiopia. on the contrary, somali says it

is still a part of its sovereign territory any time the agreement has an act of aggression to its sovereign and territorial integrity. also, it's not a good team -- good thing for their maritime resources. they are beginning to make decisive decisions. you are seeing them in from ethiopia. they are also saying that they intend to find this agreement through all the legal challenge -- channels available. this is not the first time that the lan access or see access is bringing tension in the horn of africa. this agreement, as it unfolds, is likely to heighten political volatility and further strained diplomatic relations. kriti: that was the crucial news. we thank you as always. really interesting to see the different politics around the red sea separate from what you see between the rebels in the conflict between israel and hamas is playing out.

there's a lot going on in the region that a lot of people are watching. coming up, we go from the middle east and the continent of africa to europe where u.k. executives are urging the bank of england to cut rates after economic confidence seems to a four-month low. does that mean there will be more pressure on the bank of england or on the pound. a cable rate that is at 126 right now. really coming off of that dollar weakness story. do we continue to see momentum going into 2024, or is this the straw that breaks the camels back? all of that analysis ahead. stick with us. this is bloomberg. ♪ (jennifer) the reason why golo customers have such long term success is because we focus on real foods in the right balance so you get the results you want. when i tell people how easy it was for me to lose weight on golo, they don't believe me. they don't believe i can eat real food and lose this much weight.

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kriti: good morning. this is "bloomberg daybreak: europe." i am kriti gupta in london. the new year hangover continues. it's one of the weakest starts to a year for stocks and bonds in over a decade. minutes out of the fed could give us some indication as to whether last year's rally was indeed overdone. hamas saying israel has killed one of its senior leaders in a beirut explosion raising concern about what escalation in the region might look like. tesla loses a top spot for global ev sales to byd, failing to outsell the chinese automaker in the fourth quarter. there is crosscurrents from the corporate to the monetary policy. must get a quick check on markets. it is a sea of red which tells

you risk sentiment is indeed off. you can see that underperformance particularly and euro stoxx 50 futures. europe did outperform yesterday so it's normal to see a technical pullback amid the holiday volumin -- thin holiday volume. japan in particular is closed when it comes to treasury trading so you are not seeing the immediate bits put out until you media traders make that first trade but you are seeing u.s. 10 year bond futures are catching a bid, which tells you the pressure from the bloomberg dollar index may be a function of the rate pressure as well. euro dollar at 1.09. the sentiment shift you see in the last 30 minutes is in the commodity space. we see brent crude trade at a $75 handle. not a major move for oil but it is indeed telling that it is

moving in the opposite direction as the rest of the cross asset story. in the meantime, one of the big questions is going to be how much of the market pricing when it comes to monetary policy is actually what's going to prevail? that's what i want to bring you this chart specifically showing what the market is pricing. in 2024, we are looking at some five rate cuts priced into this market, this is for the federal reserve, of course. what president d.c. set for the ecb, the boe, and whether or not this is the market taking it one step too far or putting the market in control more so? i want to bring it right here to the u.k., where the institute of directors is urging the bank to cut interest rates to prop up the flagging economy after confidence sank to a four month low. joining us now, correspondent lizzy burden. what are they saying? >> this is the institute of

directors economic confidence index. it felt even further into negative territory, it's almost at a 2023 low for december. it tallies with that lady's to gdp data that showed that the u.k. is basically flirting with technical recession, which is a difficult backdrop for rishi sunak, the prime minister, given that he promised to grow the economy, given that we've got an election coming up expected this year. the institute of directors and says an early rate cut would kickstart business confidence in the u.k. markets are pricing here up to six cuts in 2024 starting as soon as may. if you're a hike at the bank of england, you would say inflation is still more than two times the bank of england's target. kriti: we are talking about inflation and growth, a lot of that is going to come around affordability and whether the u.k. consumer can afford the bear necessities like energy prices, food, housing.

we are getting grocery price inflation data later. how does that translate into the boe? >> it feeds into the story we have been getting over recent days. we've had the british retail consortium's encouraging data. food price inflation important to the u.k. inflation story, it's been a key driver here. we have had encouraging signs also at the headline level. cpi falling to 3.9%, even though it is almost twice the boe's target. going back to the institute of directors' release here in that we've also got next releasing results tomorrow. it is seen as a barometer of the u.k. consumer. over the past nine months, they have raised guidance for both sales growth and profit on at least four occasions. if you look back over the past 12 months, the shares are up 40%.

a shows you do not necessarily need rate cuts together business going in the u.k. next something of a barometer, as i say, for the u.k. consumer, so those results will be out tomorrow. kriti: lizzy burden all over that story. thank you for your analysis. and reporting. a big part of the story lizzy is talking by is the inflationary dynamic and what it means not just for the average consumer but businesses as well. do you start to see that same momentum that a lot of big tech companies like apple are actually showing? it does actually all connect. apple at the end of the day we think of as a big tech company. yesterday it took its biggest hit since september all on a barclays downgrade. this is a really important story because at its core, it's talking about this consumer ability to not just a for the bare necessities but afford luxury items like iphones. this is where i think a quote is really relevant. they are saying they expect a reversion after a year where

most quarters were missed and the stock outperformed. they are saying their channel checks remained negative on volumes for iphone 15 with no futures or compelling upgrades likely to make the iphone 16 a better bid. barclays coming out and saying that basically apple's kind of marginal gain you are starting to see is not that exciting so actually cut to underweight for the first time since 2019. i believe they are the sole bear to do so on wall street at the moment. you see another positive story from big tech into the biggest bank in the world, j.p. morgan climbed to a record high. this is such an important story when we talk about what we are actually seeing in terms of the translation from the net interest income that we have seen for a lot of central banks into not just american banks but european banks as well. a big question is, how much of that momentum actually sustains as well? jp morgan hitting that record high and driving the s&p 500

into any marginal gains you see. it is still light trading volume but it is something we are watching very closely. however, not everyone agrees. if you look at wells fargo analyst mike mayo, he ha demoteds -- has demoted j.p. morgan asset stop bank stock. he's putting his weight behind citigroup which he expects to more than double over the next three years. >> my top three picks for 2024 are citigroup, citigroup, and citigroup. he could either consider citigroup a three ring circus or you could view it as three connecting circles like a three circle venn diagram and i choose the latter. the first circle is their simplification, delayering management from 13 years, 13 from the bottom to the top ceo dr. eight -- ceo down to eight. they are eliminating two intercompany lines of business,

they are organizing along five lines of business, that said. that's kind of -- that's it. that's kind of remember one. ring number two would be there transformation where they are finally modernizing their back-office technology and some of this is regulatory driven. the third ring are these business eggs retrading for fortune and nine other u.s. businesses -- retreating from 13 and nine other u.s. businesses. i am saying it turns out well enough for this stock to double over the next three years. >> we kind of know where james frazier has been trying to. this is going to be a slimmer company than what it was here. does not automatically translate into better profitability -- does that automatically translate into better profitability? citigroup is becoming a much more >> the next three years.

this is make or break time for jane fraser. is this due to jane fraser? may be. i think so. but not definitely. to some degree, the feedback from investors has been for the last year, citigroup has blown up the profit and loss statement due to expenses that are out of control. my view is they are ripping the guts out of the company, reconstructing it, and that costs money, but those expenses then start going down and they've already guarded expenses to go lower in 2024 and for 2025 so i think this is a combination of a much more optimized, streamlined, efficient from and that were driver turns much higher, that should drive the stock price much are. we have several scenarios in my 50 page report. . if there is a recession, i think citigroup underperforms. outside of recession, we think the stock doubles. in a bowl scenario, i think citigroup's stock triples over the next three to four years. >> this isn't even the most

optimistic scenario. this is if they get most of what they promised to done, the stock can double. what about the fact that lots of ceos at citigroup have tried to embark on reorganizations and have not executed? history is not on citi's side. >> you can read exile on wall street. i wrote two of the 10 chapters about the failures of citigroup so i understand citigroup's mistakes but what's different this time as a result of this restructuring should be a much more simple citigroup, not a more complex citigroup and that's night and day. kriti: wells fargo's mike mayo speaking to romaine bostick and scarlet fu. later, don't miss our exclusive interview with morgan stanley's executive chairman, james gorman. he's on his way out. we will have an exclusive interview. in the meantime, i want to get

some of our other top stories from this morning. harvard president cladding ga -- claudine gay stepping down and initial tenure marred by allegations of plagiarism. she says it's in harvard's best interest for her to leave the job. . her exit is a dramatic out face from her acclaimed start in july as the university's first black president. donald trump has filed a lawsuit seeking to restore his name to maine's presidential primary about. the state declared the former president ineligible for another term under the u.s. constitution's 14th amendment, which bars candidates to engage in insurrection. colorado republicans have already asked the supreme court to reverse a similar decision in their state. the social media company x has started to re-show news headlines alongside links shared to the service. the mover versus a change that owner elon musk said had come from him directly back in october. critics of the original change said removing the news headlines

made it more difficult to determine what articles other users were sharing. speaking of elon musk, you cannot talk about him without second about tesla -- without thinking about tesla, which has now been overtaken by china's byd in global ev sales for the first time in history, as tesla delivers more vehicles tan expected in the fourth quarter. aggi cantrill all over the story in berlin. how much of a game changer is this for tesla? aggi: hi, kriti. yes, it is significant that this is happening because it is showing that tesla, which has always been at the forefront of the ev market, is competing now with other players. but it doesn't mean that it wasn't also a good quarter for tesla. they did deliver on a lot of their commitments and it is important to know that byd does offer completely different models to tesla. they have a broader range and they are significantly cheaper. those two things mean that yes, it's competition for tesla, but

really this is more conversation to be had about the broader ev market and how significant china's role is going to be in boosting ev' around the worlds. kriti: speaking a boosting ev's around the world, just given that china is such a significant exporte as well, when it comes to some of the moves we are talking about for passengers from the world -- around the world, is this a china story or is this a global story given that china is the leader in electrification? >> i think something that is significant about china's role is that for a long time, china has been building the cars for car companies from the rest of the world. they have had a huge amount of production within china. now, china's own brands are managing to make strides into this space and they are committing to ev's as that option. the interesting thing with byd as an example, it's a company that is not only developing ev's

but is also developing the battery technology around that. they are attempting the vertical integration that so many tech companies tout as well as something that they are striving for. an something that is interesting about that is that this is clearly a commitment on the part of the chinese policy to also invest properly in this industry and that also comes with conflicts or issues with other parts of the world, like for instance, we have seen the european union opening a probe into china's use of subsidies to support their own ev companies because they are clearly concerned in the eu what this might mean for europe's own automakers that are legacy players in the auto space that are trying to push into the ev market. kriti: certainly something we are going to be watching very very closely as we start to see basically both china's largest ev maker and the u.s.'s largest ev maker duke it out on the global stage. aggi cantrill in berlin, thank

you so much for your reporting and analysis. we go from big tech to big health care, if we can. anti-obesity drugs could be worth $80 billion by 2030. we are going to take a deep dive into a market that's getting a lot of investor attention. that coming up next. this is bloomberg. ♪

♪ kriti: welcome back to "bloomberg daybreak: europe." i am kriti gupta in london. markets getting a lot of attention from investors. bloomberg intelligence says anti-obesity drugs could be worth $80 billion by 2030. it is a sector dominated by novo nordisk and eli lilly. joined by sam fazeli from bloomberg intelligence for the deep dive. how much of this is a 2023 story? what kind of momentum do we see from big pharma? >> one of the key things we have

noticed now is a similar thing that you have seen in the ai stocks. they started the year not looking pretty yesterday, right. i think there might be a risk of that going on this year, too, that people played the obesity wave or idea last year and now they are looking elsewhere in health care. that might be a trading situation. because this is, as you see the estimate behind you, $80 billion is the number they will be going for, there's people who've got a bigger number in mind. it is clearly a very massive unmet need and there's many reasons to be doing this in terms of trying to treat obesity. kriti: you are seeing some of the bigger health care companies, i think pfizer, merck, starting to diversify their portfolios and everybody wants a piece of this anti-obesity, weight loss medication. what does the competitive landscape actually look like? sam: it's pretty busy.

one of the companies that has categorically said we are not in it is johnson & johnson. this year, i think we are going to get quite a lot of interesting not massive new trial that's going to then get a product to market, but we've got data coming on two assets, data coming from pfizer as to whether they are actually in the game or not with regards to their once daily oral, and we have data coming from a small danish company with a mechanism of action that's completely different to the ones that are on the market today and that will also be very interesting. it has a niche to play. not everybody can tolerate the ozempic. kriti: it feels like this is an easy area to be regulated pretty aggressively as her and i know that there are some positives for people with heart conditions and that's been proven in some of their research. could that get in the way of this industry meeting the $80 billion you suggest? sam: no.

i think the pressure might come on pricing as opposed to -- of course, there's always a risk of any chronic treatment -- with any chronic treatment of side effects showing up. our drug has been on the market for five, six years a ready, we have not seen anything. aside from side effects, prices also going to be the thing. price has to give if we are going to get to those revenues. already we are at the 50% discount to the list price that people see. one of the key things to remember is that cardiovascular is one thing you saw. data was published completely independently, 15 years of treatment with some magnetite in treating diabetic patients have the risk of cancer. there is more to obesity and problems it causes than just cardiovascular. kriti: what's interesting is the

global read through having as well. walmart made a big statement last quarter sing because of these anti-obesity drugs, they are monitoring the consumer impact and a how much people are going to be wanting to shop for things like treats. do we start to see some sort of trade-off when we talk about these type of medications? sam: you have to assume that as the volume, as the interest goes up, the prices going to come down, there is no question about that. the question is, what is the right price? in terms of their impact on other industries, i think there have been some things that people have said that are more on the fun side than real side, such as airlines impacted, etc. i think companies have to watch this in terms of the consumer. i don't think it's going to happen overnight because we are only treating 2% of patients today. but we can see those patients, specifically people like walmart

, who have a pharmacy, who can follow that individual within their shopping habits, too, to see if there is a genuine impact, and then adapt. kriti: is this an american consumer store at its core? sam: obesity is a significant issue in the u.s. but outside in london, you see people walking around with extra pounds, right? and nobody likes that. we all enjoy food but some have less of a control in terms of how much they consume. that is not just a problem in the u.s., it's a problem in europe, it's a problem in many countries, perhaps less so in japan, but certainly not just a u.s. story. kriti: the market is actually truly global? sam: absolutely. kriti: $80 billion, that's the take. sam fazeli giving us all his analysis. plenty more had. stick with us. -- plenty more ahead.

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kriti: welcome back to "bloomberg daybreak: europe." i am kriti gupta in london. i want to put one chart on your radar, something i have been ranting about. when we are talking about the dislocations in the market, i have set up the trade for 2024, what's really important is going to be the dark. euro-dollar hovering at 1.09, the pound as well, cable 1.26, you are seeing real strength and weaker economies around the world. that is very different to the start of 202023 and perhaps a precursor it's going to set for the rest of the year. when you're talking about strength of these currencies, it's largely driven by the dollar. bond yields coming down, the dollar getting weaker, creating a tailored.

yesterday, the dollar had the strongest start of 2024, the largest jump in the bloomberg dollar index going back to march. it speak to this idea that perhaps this dislocation, these positioning's in the market are going to see an underlined. the idea you have this long dollar position that was pulled back in the fourth quarter of 2023, maybe it is getting reversed and you are seeing more people bid into the dollar, at the expense of currencies like the euro and the pound that perhaps seemed stronger than maybe they should be when it comes to economic fundamentals. some food for thought. later today, don't miss our exclusive interview with morgan stanley' executives chairman, james gorman, on his way out. 3:30 p.m. london, 10:30 a.m. new york. this is bloomberg. ♪

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