>> you are watching "daybreak: asia." coming to you live from new york, sydney, and hong kong. >> australia has just come online. traders are paring back bets on fed rate cuts as the dollar jumps the most in 10 months. the prospect of a third pivot, and china waits for the stimulus in the form of special bonds as the premier says the economy hit its 2023 growth target. >> the fed governor chris waller

, among get to too many details of what he said but what he is calling for is a cautious, careful approach to cutting rates any says that can only happen if conditions are right. they don't want to see inflation rebounding over the course of this year. higher treasury yields was the hallmark of the previous session, and a firmer dollar, the biggest jump for the greenback in 10 months. the aussie dollar down as much as 1.2%. stabilizing here. it's negative for equities and were seeing most futures point to the downside. the asx 200 with a flat start but staggered as well. we will see how it performs in about 10 minutes from now. take a look at what else is shaping up, the japanese yen trading around its 100 day moving average.

currency weakness does continue to be present. some of it could end up boosting japan stocks over the course of the day. kiwi stocks online to the downside and you're tracking what is happening in china today. and we will get the monthly activity data, gdp reading as well for last year as well. shery: u.s. futures opening really muted after resolve s&p 500 pressured, that fed speak pushing against aggressive rate cut bets. earnings with big banks, wrapping those up for the fourth quarter and a little bit of a mixed picture when we had goldman sachs topping estimates but stanley disappointing, and at the same time we had oil opening to the downside, $72 a barrel right now for wti. we already so losses in the new

york session that repaired back because it is really cold here in the u.s. and that cold front hampering some of the crude supply. it was really to do with what is happening in the treasury space. the 10-year yield topping 4% on christopher wohlers comments on that methodical and careful rate cut. take a listen to exactly what he said. >> with economic activity and labor markets in good shape and inflation coming down gradually to 2%, i see no reason to move as quickly or cut as rapidly as in the past. haidi: the chinese pimm or said the economy grew around 5.2% in 2023, surpassing the government's growth target through the year. he was speaking in davos. >> the chinese economy can handle ups and downs in its trans performance.

the overall trend of long-term growth will not change. haidi: let's bring in our china economy editor, typically that gdp number is less interesting in terms of what you want to see when you lift the hood with china's numbers. that's what we heard from the premier tell us about the balancing act that beijing wants to strike in terms of maintaining a reasonable level of growth without adding too much more debt risk? >> the first thing to consider is that we saw this number a day ahead of the official announcement, a bit unusual but maybe just projecting confidence in the trajectory of the chinese economy or confidence in setting the growth target for 2024. it's important to note that he did say that was without any

kind of massive stimulus. beijing wants to underscore that they don't want to make tons of cuts. there is more they have to consider, the fact that the fourth quarter was a low bar to hit, comparing to 2022 when we were dealing with quite a lot of outbreaks of the pandemic. so a low basis to compare. it's really about that balancing act, are they going to cut rates or up fiscal policy? i think they're saying we want to be measured in their approach to 2024. shery: china is considering more stimulus and federal bonds. how significant is this and

could this impact the issues the country has faced for years? >> is important to dig deeper behind the numbers we are reporting, still considering the idea of special sovereign debt issuance. it's really not about the number , it's more about the philosophy shift behind this idea. we are holding to what he is already telling us here, this would be a massive support measure in dollar terms if they roll it out. but remember this is special sovereign debt from the central government. there's a lot of widespread concerns in china about the fact that local government -- governments over the past decade or so, the sea change we've been exploring over the past year with the idea to shift more of the debt versus the central government off those heavily and

that local governments. this would be a step in that direction. so more of the shift in terms of who's got the spinning responsibility, trying to create a more sustainable debt model for this economy. shery: here in the u.s., big banks have been wrapping up fourth-quarter earnings this week and the latest session, golden sex beating profit estimates, seeing revenue from the stock trading unit surge. morgan stanley also blew away estimates but it's outlook disappointed. su keenan joins us now with more. we saw the reaction in the respective stocks and goldman actually gaining ground. su: goldman blew away expectations, particularly from its equity trading desk where revenue was triple what was expected. also helping drive gains, posting the highest quarterly revenue in two years on the sale

of financial management business. between goldman and morgan stanley, a tale of two different stock performers, which we will get to them just a minute. in any event, it counted a few weak spots, extend come trading results and investment banking fees fell short of expectations. the ceo said this was a year of expectation, or execution i should say, for goldman sachs. with everything achieved in 22 and three, he says coupled with their clear and simplified strategy, they have a much stronger platform for 2024. calling the results decent and relatively solid, saying goldman results were not as bad as feared. a lot of the analysts are aware of the difficulty the bank experience. the goldman ceo in particular under pressure.

goldman more reliant on dealmaking which has remained depressed. haidi: meanwhile morgan stanley warning of lower margins when it comes to the wealth unit. su: the new ceo officially takes over this month after james gorman moves on. his first order of business was the earnings call and having to warn about lower margins in the wealth unit which has been an area of strength. investors now turning their attention to the firm's ability to meet its goals and expanding its wealth business. shares dropped the most since the last earnings call, down as much as 4.3% at one point. fixed income trading fell short of expectations and executive said the lower wealth margins would be sticking around for a bit.

saying the wealth business is in my blood. net revenue totaled $6.65 billion, beating, but again warning that the business has been aided by higher rates but it will be challenged going forward. haidi: su keenan there with the latest. coming up, ukrainian president zelenskyy meeting with business leaders in davos, trying to attract private capital. and why they see geopolitical turbulence becoming a constant concern this year. this is bloomberg. ♪

>> the resilience of the economies as well as financial markets to the geopolitical crises going on and the fight against inflation has been remarkably strong. >> there's some wind coming from 2023 into 2024. >> poised for a soft landing. >> expect very probably rate cuts for this year. >> just because of the level of

government debt and spending and the state of the economies across the world. >> we are in a tight fiscal space at the moment. >> the risk of this thing going the wrong way is there and will continue to be there for the foreseeable future. >> expect the unexpected. haidi: giving us their assessment as we get into 22 new four, there at davos. our next guest says geopolitical turbulence is now constant concern, even in economic -- he joins us here. happy new great to have you with us. it's an interesting dynamic we are working with, on the one hand we could stick a soft landing and it could be a goldilocks scenario. do you think the geopolitics of it and the risk that is building as we get into this key election year for so many economies is going to outweigh that? >> we're certainly seeing very

rapid shifts in sentiment over the course of the last six months. much has depended on the outlook and evolution of inflation, the outlook for interest rates and federal reserve policy at central banks around the world, and of course this year, fraught with elections and geopolitical events, stemming from the middle east to the u.s. and beyond. you can see how quickly sentiment can shift, even overnight, more dovish sentiment from central-bank speak, then you start to see interest rate hikes -- interest rate cuts start to be pulled out of the market. it is something that investors from that top-down perspective will have to be highly cognizant of and factor into their assessments over the coming 12 months. haidi: even with the fed uncertainty, you still see the

most compelling opportunities in north america. >> we are more optimistic on the outlook for the u.s. economy than the consensus today. that reflects following inflation, rising real incomes and the health of the u.s. consumer and the u.s. labor market. we do think the most exceptional opportunities in north america reside outside of the mag seven. in particular the mid-cap part of the u.s. equity market and looking beyond the s&p 500 to the russell 2000 for opportunities to deliver alpha over the coming three years or so. haidi: outside of the u.s., what are you liking particularly here in asia? >> we've just gone through the elections in taiwan any discontinuation of the status quo. with geopolitics and we continue

to like tsmc. in india, india's largest bank, really a blue-chip company within the indians to stock exchange. generally were more underweight europe and asia. really from an evaluation perspective, that's where we are seeing the most exceptional opportunities. haidi: do you think japan is a little bit overdone? >> we do expect the yield curve control, we will probably see the end of negative interest rates around april from the boj. but it has been the consensus trade over the course of the last 12 months, it has been a weaker yen and a rising topics. it is a market we are looking for. we have not found the right

opportunity to invest in yet. but we think in terms of markets, it is an environment where it's all about that bottom up stock selection rather than getting the exposure to indices. so we would be more favored of looking at exceptional opportunities rather than the topix as a whole. haidi: you talked about compelling valuations. what do you think, is there anything that would compel you to take some risks there? >> it's almost bearishness on china at the moment. china is getting closer and closer from an evaluation perspective to potentially being an allocation within a global economic fund. i would suggest we are not there yet. >> what would be catalysts?

>> there is still the overhang of debt buildup, concerns around the property sector, around consumers building up savings. you start to see those overhangs be alleviated and potentially see central-bank action. that would see foreign directives start to flow back to the u.s. stock market. haidi: great to have you with us. more to come on "daybreak: asia." this is bloomberg. ♪

>> we are so happy. >> thank you so much. >> great to see you. shery: we're looking at

ukrainian president zelenskyy meeting with business leaders at davos. he is seeking to attract private capital with millions of dollars of aid for ukraine currently stalled in washington and brussels. >> geopolitical risk and the potential for another trump administration are dominating the conversations here in davos. first to the geopolitics. president zelenskyy was here meeting with business leaders like jamie dimon and ray dalio. this comes as they are trying to rebuild their battered economy. this as aid talks continue to remain at a standstill in washington dc. they are looking for $100 billion in aid from both washington and brussels. the potential for trump 2.0 has everyone wondering what would that mean for their economy,

especially europeans. the started on friday when christine lagarde said another trump president would be a threat, and that is not going away anytime soon as iowa voters last night gave him a commanding lead. haidi: some of the other geopolitical stories were following, another commercial ship has reportedly been hit by a missile in the red sea, the second in 24 hours. the u.s. says it forces destroy -- his forces destroyed four targets on tuesday. professional services say underwriters are seeking exclusions when issuing trips.

houthis continued their attacks on ships. chevron ceo said the firms japan -- plans to work with naval authorities in the u.s. and the middle east. >> we engage with the u.s. navy and other security organizations , the arabian gulf, the red sea, and we have a security plan, it is shipped by ship that we evaluate the situation. i'm working closely with maritime security authorities. risks in the region have been accelerating over the last several weeks. these are risks we deal with all the time. last year we had a couple of ships attacked by the iranian navy. one was boarded and hijacked

into an arena import. this is a part of our business we take very seriously, the safety of our people is the most important thing and the risks in that part of the world are very dynamic and volatile right now. >> have you made any changes in the past few weeks? >> we may change us we don't talk about publicly. we have not made fundamental changes to how we been moving ships over the last few weeks. >> are you surprised we haven't seen any influence on prices whatsoever? >> i actually am. traditionally when risks elevate in the middle east, you see it reflected in markets, we've not really seen that yet. so i'm a little surprised. >> do you think the excuse people use, which is that the u.s. is just overwhelming the world with oil and that's why oil prices have remained immune to any tension in the middle

east, do you buy that story? >> certainly supply growth has surprise people to the upside. that has helped calm markets a little bit. it certainly has no ability to cover up a big disruption in the middle east. that will fundamentally change supply dynamics in the world. if you were to see shipping halted, disrupted or seriously disturbed. the u.s. supply has helped calm markets over the longer cycle, but there is no capacity to respond in the short-term. >> how much potential is left, how much higher can the number go? >> he can go higher. the u.s. is blessed with an abundant resource base. the constraints continue to be -- a decade ago companies in our

industry were growing too fast in the permian basin and investors were unhappy with that. if they were to return to the ways of the past, you could see the number go higher. i don't see that going on right now. but the u.s. has upside. >> i would love it if you could quantify where we could see prices go if some of the disruptions come to pass, if the u.s. still has the ability to produce more oil. couldn't it offset the disruption that we haven't seen yet? >> it could, but not immediately. the fastest is like nine months. our plans are set for years in advance. it is a big system that we run ♪ ♪

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>> last year, in 2023, chinese economy rebounded and moved upward. it was an estimated growth of around 5.2%. higher than the 5% target set at the beginning of last year. in promoting economic development, we did not resort to massive stimulus. we did not seek short-term growth while accumulating long-term risks. shery: the chinese premier speaking there in davos. not to mention the geopolitical challenges ahead, scott, always

great to see you. how would you say the speech as well as the reception from the audience at this davos compares to past performances by chinese leaders? >> the only other real comparison that needs to be made is with xi jinping's speech at davos in january of 2017. what a difference seven years makes. when xi was there seven years ago, he took davos by storm through a very forward leading speech suggesting china can prov goods for global reach. the u.s. was in the midst of inaugurating donald trump. seven years later he was much more defensive. he had to say that the world could trust china, that china

keeps its word and china's market is not a risk, but an opportunity. he did not mention the belt and road at all. despite sending a very large delegation and making news by announcing the 5.2% growth rate for 2023, my guess is that the audience still came away rather skeptical of the message he was trying to convey. shery: one of the key points he made sure to mention was the fact that china wasn't using risky or short-term measures to prop up the economy. bloomberg is now learning they want to have more stimulus for the economy, more than $100 billion of special bonds. how does that compare to real action on the ground? >> i understand why he didn't want to emphasize the stimulus because he didn't want to suggest that the chinese had

made any kind of mistakes. on the other hand, if he had said we are going to have a larger stimulus, that would've been actually reassuring. if he had said here is a date, we will announce a whole variety of reforms, that would have been reassuring. if he had announced plans rather than saying that plans were coming, that would've been reassuring. so there could have been a whole variety of things he could've said that would've been reassuring to that audience that he left off the table. haidi: as you say, it may have been underwhelming for the audience. you sound a little underwhelmed as well. do you think the economic challenges, is that hindering beijing's ability to take a global leadership role which was

trumpeted in his davos speech, right? >> is partly that there is seized domestic challenges, challenges with the military, the minister of foreign affairs to handle. but it comes down to xi jinping and the direction he has taken china. january 2017, he said he wanted china to build a stewart of multilateralism, and given the amount of industrial policy and friction with the united states, which is caused by both beijing and washington, it just doesn't look that way. today he did not mention ukraine at all. there was a meeting which the chinese skipped. there is no mention about the taiwan strait, one of the biggest things that ceos are worried about.

there is a direction china is going which is running counter to the concerns of global business people and to the chinese private sector which is the single source of employment and growth in china. haidi: we've been watching this idea of high-quality growth. things like electric vehicles and ai technology. while all this feed into even more heightened tensions with global trading partners, as we go into a u.s. election year? scott: as long as bloomberg has been reporting on china through this program, chinese officials have been talking about the importance of high-profile growth. for decades have been emphasizing that. is that something that will be

shared with the rest of the world, or will it divide the world between chinese winners and losers elsewhere? there is a concern that while the policy is generating high-value growth for china, might be putting the auto sectors, our energy industries elsewhere. so we've got to find out a way that chinese economic policy is both creating for everyone in the region and in the u.s.. there is a good argument to be made for that. i cannot tell you the level of skepticism i encounter here, and we will hear about it all 2024 during the presidential campaign. shery: we have been focused on what was happening in taiwan with the elections there. china decided to publish that old speech by xi jinping.

how do you expect the tensions in the taiwan strait to play out in the next few years, and what are the risks and implications for the economies of these two territories? scott: china cannot give up the goal of unification, and it can -- announce that we will never use force. but it strategy in the run-up to all the selections obviously hasn't worked. they have not followed the instructions from regime. china's military capabilities are quite impressive, but there is a balance of power, so they have to go back to a different playbook. he is partly pulling that out and saying for the next few months we've also got to figure out how to stabilize things. also, you can't play on your tough cards at the election outcome, there is still several

months before the inauguration and there is much more to do. so it's going to be dicey. i think the u.s. and china are talking a lot about taiwan and trying to avoid a crisis. i think there will be a lot of heartburn but i think there is a way to navigate through this so that the world's global economy and the conflict does not emerge. because it really is unnecessary. haidi: always great to chat with you. a south korean battery giant says it's hope for a progressive sector. he spoke exclusively with bloomberg in davos. >> petrochemical is going through a challenging time right now. the global capacity exceeding

the global demand, which is not coming back a strong us will not have expected, especially after covid, and particularly -- at the time, global capacity continue to expand. i'm not overly worried about it. >> when do you see china's recovery coming back? >> we hope as soon as possible. i think chinese new year is coming up. hopefully there will be more events in china.

it's not a lack of money, but they do spend, not as much as before because they're worried about a lot of things. the general economy, war, inflation. it is tough to maintain its own domestic cycle. i think the prospect is not recovering demand in china but in terms of slow recovery, it is quite certain to be better going forward in china in terms of demand. shery: we are seeing early reaction across asia when it comes to the fed governor chris

walters comments, pushing back on those aggressive rate cut bids. what are you seeing? annabelle: it has been the key thing across different asset classes. let's kick off with the bond space, is that move higher for treasury yields. a little more by the longer end of the curve which is in line with what we had in treasury moves in the prior session. as you said, the fed governor downplayed the need to rush cuts and said that they do really want to see price pressures contain inflation coming back under control before we start to see any reduction. so it could be later in the year. so they are recalibrating their expectations, lower odds now for a cut. the moves and treasuries that lead to a stronger dollar, that is a negative for stocks generally.

what is moving the most to the downside is what we see in the energy sector. the index down .8%. it does reflect the moods we see in oil price as well. wti is low for a second straight session, you've got energy names leading the losses so far in the session. the downbeat mood did and the struggle though it did outweigh some benefactors. red sea tensions do persist and that could lead to higher oil prices over the longer term. haidi: annabelle in hong kong with some of the elements we are watching as we get into this trading session. catch up on past interviews at our interactive tv function.

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open markets in japan. saying the bank of japan is likely to move way from its negative interest rates but -- rate policy as soon as april. christopher walcott telling us investors betting on rate cuts from other central banks this year may be disappointed. >> i think the main theme is inflation and monetary policy still. we've had a year of inflation fighting from the central banks and they seem to have got that under control. we've had a disinflationary mood for the last few months. that has led to a broad consensus for a soft landing across the u.s. and in the dollar markets. i think clients broadly are going to be focused on whether that comes to pass or not. our view on that is a little more cautious.

we think central banks will remain vigilant for longer. i think they were shocked by this inflation move and i think they will make sure it is under control before they move forward. our review of the market is perhaps that interest rate cuts, little bit later and there are fewer of them in 2024. >> the one bank that stands out is obviously the boj. you are quite well-placed to give us a view on what you guys are anticipating on where we see a move, what impact would it have on you? >> the boj obviously, a lot of people have been watching their think -- extremely accommodating policy. there's been a lot of narrative this year that they would be able to stick to it, yet they broadly have. we think that our view has

changed and moderated because growth in japan seems to be reasonably strong we do expect that to continue. the markets in japan have been very strong in the last year which has been great for our business and our clients. with think it is quite possible that we see a move away from negative interest rate policy that they've had, sometime in the first half of this year, possibly as soon as april. and also perhaps move away from yield curve control as well. having said that, we don't expect them to then go into a heightening cycle anytime soon. they are determined to get a virtuous circle going between wages and prices. haidi: no mirrors investment banking had speaking to bloomberg from davos. let's look at some of the other

stories were following, spirit airlines shares lose half their value after a judge blocked jetblue's takeover. the court ruled it would stifle competition. it argued it would eliminate a key incentive for airlines to offer budget friendly fares. shein must immediately cease sales of imitation products and compensate for damages. the latest retailer to sueshein over alleged copyright infringement. bp is reportedly close to naming an active ceo as a permanent successor. saying an announcement could come by wednesday. he was named interim ceo in

september after a resignation for failure to fully disclose relationships with former colleagues. and why ai may not be the job killer that many fear. a discussion from davos coming up in just a moment. this is bloomberg. ♪

>> ai is a brilliant tool for people to be more productive. now, it means the bad guys will be more productive, so you got to make sure of cyber defense or measures to fight bioterrorism are in the hands of the good guys. it is a challenge. people sometimes lose sight of the fact that this is the biggest productivity advance in our lifetimes. shery: bill gates speaking about artificial intelligence at davos . sam altman says he doesn't think ai will replace human jobs to the degree that some people are expecting. speaking to us in davos, he weighed in on the u.s. presidential election campaign. >> i think there's a lot at stake in this election. elections are huge deals.

i believe that america is going to be fine, no matter what happens in this election. i believe ai is going to be fine no matter what happens in this election, and we will have to work very hard to make it so. but no one wants to hear me rant about politics. but i think there has been a real failure to sort of learn lessons about what is working for the citizens of america and what is not. >> there are political figures in the u.s. and around the world like donald trump who are tapped into a feeling of dislocation, anger of the working class. a feeling of exacerbating inequality or technology leaving people behind. is there the danger that ai furthers those trends? >> yes, it's something to think about, but one of the things

that surprised us pleasantly on the upside, when you start researching and saying we are following where the signs lead us, we will follow where users lead us. you get to steer it, but only somewhat. this is what the technology can do, this is how people want to use it, and this is what it is capable of. it is much more of a tool than we expected. in the future it will get better, but it is not yet replacing jobs to the degree that people thought it was going to. it is an incredible tool for productivity. you can see people magnifying what they can do by factor of two or five. that is quite exciting. this new vision of the future that we didn't really see when we started.

i'm thankful the technology did go in this direction. it lets people do their jobs better, let's ai do parts of jobs. and of course dobbs will change and some jobs will totally go away. but the way society works is so strong, and i cannot believe i'm saying this, but i think ai will develop in the close future and it will change the world and jobs much less than we think. i may be wrong again, but given my conception of how ai is going to go. >> have you both changed your views on how significant the job dislocation and disruption will be as ai comes into focus? >> you hear younger people say they are more productive than

ever. it turns out, and i think it will be true for a lot of industries, the world just needs a lot more code and we have people to write it right now. it's not like we run out of demand, expectations grow, but ability goes up too. haidi: speaking of ai, the australian government will consider introducing management guard rails on the development of the technology and what it calls high risk settings. it will weigh options for restrictions on ai. an earlier review found that voluntary restrictions were not sufficient with the lack of transparency. we are counting down to the start of trading. coming up next, tokyo. this is bloomberg. ♪

>> this across asia right now when it comes to the pushback again from a fed official on aggressive rate cut bets. the 10-year treasury yield top 4%. >> some risk aversion on account of developing geopolitics of course when it comes to oil markets and shipping risk as well but of course some risk coming from the data dump we are expecting about china today. we know what to expect thanks to the premier speaking at dallas but we are looking ahead to how those domestic activity indicators play out, whether that stabilization of the slowdown is seen. that's get you straight to the

market opens. annabelle: thanks. the open of japan and. as well. -- japan and korea as well. it comes down to what we heard from the fed governor overnight. as you said, it is about being careful and methodical when it comes to cutting rates over the course of this year. while there says he does not want to see a research in inflation and that would be something of course that would keep rates higher for longer as well as appearing to push back on these expectations and markets that we are going to be seeing six cuts over the course of this year so that really played into the direction of treasuries as you said and we saw high-yield coming through, holding above 4% this morning as we come online and we have seen bond yields moving higher across the asian session so far today and when you do have that direction for treasuries, a firmer dollar, that plays into the dynamics of the japanese yen of course and that we as we have seen in the currency around its 100 day moving average at this point, he is one of the reasons

that japanese equities have been performing. you have the nikkei standing at .8% to the upside even though we are expecting most markets in asia to trade lower in the session today and that really is the focus of today's big take as well, the market dynamics, why and how we are seeing japanese markets rolling back to life because these -- roaring back to life. let's take a look at what is happening in korea so far in the session. that focus very much coming down to the moves that we see in a firmer dollar. the reactio into what we see for the korean won here because we are having that weakness coming through. it is already around the two month low, the currency. emerging market assets generally have been under pressure given these doubts around the outlook for the fed's rate cut path and yesterday, we saw emerging markets stock index following the most since august. it is not move that we see in the dollar and also in

treasuries. so far, the kospi trading fairly range bound. the aussie session being dominated by some of the energy moves so far and we see energy stocks under pressure linked to very much so that move you are seeing for wti, lower for a second straight session. it is that demand dynamic that is playing into it, that risk-off sentiment because again, a firmer dollar does pressure commodity prices even though we do see supply constraints building in the u.s. , tensions, and as well, you have the outlook for china's economy and the demand that we are going to be seeing for oil from this coming year. haidi: and a lot of those numbers will give us a better idea as to how that recovery is shaping up and the chinese premier says the economy grew at around 5.2% in 2023, surpassing the growth target for the year. he was speaking in davos one day before the country unveils its official growth numbers.

>> last year in 2023, the chinese economy rebounded and moved upward with an estimated growth of around 5.2%. higher than the 5% target set at the beginning of last year. in promoting economic development, would it not resort to massive stimulus? we did not seek short-term growth while accumulating long-term risks. haidi: let's bring our china economy editor for more. perhaps less interesting was what he had to say and more about the fact that he said it at all, right? was this part of a broader confidence building exercise for international investors and partners? yes, certainly, haidi.

this is pretty unusual that he would kind of front run these gdp numbers here at davos. obviously, we are going to be getting more of that data today, more comprehensive data, looking at how industrial production performed through the end of the year, fixed asset investment, retail sales, unemployment against population numbers, tons of stuff that we are expecting out of china in just a couple of hours here. but yes, i think the fact that you saw him talk about the fact that you have apparently surpassed about -- they're 5% gdp target for 2023 shows this idea that they are confident in at least how the economy performed last year. the question is what is going to happen this year. he gave a hint that they are obviously very focused on risk control and this idea that they don't need massive amounts of stimulus, massive amounts of government spending to actually keep things in check. we will see how much that actually plays into the calculus of how they form fiscal and monetary policy for this year. shery: bloomberg has learned

that china is actually considering more special bonds, more than $100 billion of them, and it is a very rare fail of such bonds. jill: yes, so we are reporting that the government is considering issuing this additional sovereign debt, a special sovereign debt so tradition has it that this would not normally be counted towards the budget deficit for the year. we will see if that is actually the case has details continue to firm up. i think in keeping in line with what he said about not using massive stimulus to support the economy, that is true in the sense that this type of issuance would be fairly small numbers wise. about $140 billion. that is not a massive amount of stimulus but what i do think it tells you is a kind of feeds into this idea we have been seeing over the last year in china that there is a bit of a sea change in terms of how they actually sort of at locate these spending responsibilities.

for the past many years, there's been a massive amount of debt filled up among local governments in china and that has become a very unsustainable model in china and this idea would be to shift some of that spending responsibility, that spending burden from these local debt ridden governments to the central government. we saw that a bit with the midyear revision in october of last year. this type of plan would take that to another level. haidi: our china economy editor there. let's bring in our next guest to says china's policy makers becoming increasingly focused on risks. with us is the senior portfolio manager. great to have you with us. does this mean that we are actually seeing more confidence in the chinese economy? we saw his speech at davos and now, we have news that potentially we could see more special bonds. what does this actually mean for the chinese economy, 2024? >> good morning.

we are already starting to see it pickup the encyclical indicators whether that is credit growth, volume grows, and so on, so there are modest signs of cyclical activity. whether that translates to improved investment confidence is going to take more time and is not just about putting more liquidity into the economy but providing clarity around regulatory policy and being more consistent with policy measures that support or go against the private sector as well. and that is something which institutional and overseas investors have paid attention to because a large part of the biggest weight in the equity indices there are technology companies, e-commerce companies, so some of those regulatory measures directly affects the long-term growth outlook for these types of business models. shery: you say in your notes that we are expecting to see growing de-synchronization of global growth. where do you see the upside in 2024? marc: what we mean by d

synchronization -- de synchronization of global growth is there will be different outcomes for different economies . those that will fare better are those that are typically net exporters of commodities or energy commodities in addition to those economies that have strong domestic drivers of growth, secular stories, so within and asia context, we point to economies and markets such as indonesia and india. that is well understood by markets but we still see the runway of growth of those types of markets both on the equities and fixed income side, it has been broadly constructed. shery: when it comes to the u.s., we saw fluctuating data, write, whether it is the harder than expected cpi numbers, disappointing numbers, it has been a mixed bag. what does that mean for the markets in asia especially perhaps when it comes to the credit market and how that affects your view on duration as well? marc: what you pointed out was

that we saw a modest upside surprise to cpi but ppi surprise to the downside. one relatively straight forward explanation is we are seeing a bifurcation between the services economy which is driving cpi a bit more in the manufacturing side which is more ppi leaning. if we translate that into u.s. monetary policy, it is conceivable over the coming weeks that fed officials are trying to say to the market, don't be premature pricing an aggressive and quick cuts for the start of this year. it's likely there will be cuts but they might be more from the middle of this year onwards so what that means for asian equity markets, particularly those open economies that are effectively importing the u.s. monetary policy, you might see a bit of short-term volatility on currencies and local rates to reflect the fact that you are seeing a bit of a stronger dollar and a bit of volatility creeping back into u.s. treasury again. shery: tell us a little bit more about that dynamic in the bond space because we have seen long duration underperforming short-term notes when it comes

to asia and southeast asia as well. tell us about how that dynamic and u.s. data sentiment towards a potential fed rate cuts this year is feeding into that. marc: one of the reasons the and do starting to rise fast is a steepening of the curve, particularly in the 30 year spread segment because the market's perception is that this year, we are going to have easing monetary policy and probably quite supportive this policy given that it is an election year and we just had some spending package agreements within the caucus of u.s. congress recently as well and that effectively leads to slightly better optimism about the long-term economic outlook for the u.s., hence a steepening of the curve. that would tend to benefit those businesses which borrow at the short end and lend at the longer end so the financial sector might benefit from that but at the same time, you don't want that steepening to be too aggressive because ultimately, borrowers are more sensitive to the longer end particularly in

housing and that is a critical part of the u.s. economy had other economies as well. >> the bank of japan is doing its own thing. how are you expecting their monetary policy to affect equity markets and credit markets in 2024? marc: we do anticipate that at some but there will be some kind of adjustment at the margin to the bank of japan's monetary policy stance, both in terms of the policy rate also potentially yield curve control as well, but the government and finance minister has been increasingly vocal about the importance of wage growth rising in japan which they believe will be a key towards sustainable cpi at or above 2%. we have the spring wage negotiations so we will see that adjustment but is not going to come at next week's policy meeting that the bank of japan. how this impacts global bond markets, i think the bank of japan is very concerned about any disruption to not only the jgb market where there's already a high degree of concentration of ownership, but also if the

bank of japan tightens to rapidly, that will impact global bond markets, given that the major financial institutions in japan are big owners and buyers of mobile bonds, not just jgb's but also u.s. treasuries as well. >> good to have you with us, senior portfolio manager of asia asset allocation. you are taking a look at those chip stocks. annabelle: these are the ones that are moving the most so far. look at japan. electronic materials up more than 5% as well so some of the big ship linked names now. there could be a couple of different factors for this. it is a good day for japanese equities. you have a weaker yen coming through so that does help the export names. the markets are higher in japan for another session and there's the other factor as well. overnight, we saw advanced micro devices. those shares rose nearly 7% or 8% on tuesday so that chipmaker

hit its highest level since december of 2021. on a barclays upgrade, they have raised price target on the stock to $200 from 120 dollars instead so they are optimistic on ai, driving the growth story there so perhaps one of the other reasons we are seeing chip stocks gain so much in the session at the open here. let's change on because another sector we are focusing in on is the energy moves. most of the markets are fairly muted so far in asia, aside from japan chip stocks, but it is that slight move to the downside for energy linked names far in japan and korea. wti trading lower for a second straight session so it is the risk-off sentiment overall that is weighing higher yields, higher dollar, firmer dollar playing into the dynamics, which is also perhaps showing up that risk-off tone or tolerance in some of the earnings that we have seen so far. hugo boss is one of them because the ebit for the company, the high-end clothing maker that is

listed in germany, really disappointing, so we saw that stocks lighting as much as 13% but the worst session we have seen for hugo boss, the last close since march of 2020, so some of the luxury linked names but so far, some asked moves today. overall, haidi, we are quite subdued in the session. haidi: and about with the latest on some of those moves and really that risk aversion creeping back into markets. now, we have much more to come here on "daybreak asia." this is bloomberg. ♪

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filing sales tax returns? ahhhhhh business license guidance? ahhhhhh -cross-border sales? -ahhhhhh -item classification? -ahhhhhh does it connect with acc...? ahhhhhh ahhhhhh ahhhhhh >> you are watching "daybreak asia." wall street heads are finally calling the bottom on a deal that has plagued their earnings for the past two years.

the optimism comes as goldman sachs and morgan stanley reported results. su keenan joins us now with the latest and of course those were mixed results but goldman sachs at least, top profit estimates. su: it did have decent beats on areas investors wanted to see beats on. for example, equities, sales, and trading revenue was triple expectations, and this is a meaningful beat because it be to j.p. morgan, a major competitor, by a landslide. you are seeing the difference between morgan stanley and goldman sachs because goldman had a different reaction in the outlook and gave. we will get to that in just a moment but the asset and wealth division of goldman sachs also helped drive gains, posting its highest quarter revenue in two years on a gain tied to the sale of a financial management business that helped counter a few weak spots. it's fixed income and trading results and investment banking underwriting fees fell short of expectations. asset and wealth management,

however, actually did ok. they are on track to meet their target. david solomon said this was a year of execution from goldman. with everything we achieved in 2023, he said, coupled with our clear and simple fight strategy, we have a much stronger platform for 2024. analysts called the results decent and relatively solid. the bank more reliant than other banks on dealmaking, which remains depressed. however, there was talk of some optimism that we will see more deals going forward. >> morgan stanley in the meantime warning of lower margins across its wealth unit. su: that set up the new incoming ceo for a rather skeptical reception as this earnings call was one of the first handing of the rains. he takes over for james gorman who is now moving on. all of that effective in january. the bank warning of lower margins and the wealthy and and investors are turning their attention to the firm's ability to meet its goals and expanding

its wealth business. shares dropped the most in three months as trader -- trading revenue fell short. it did beach on overall revenue but missed on both equity and fixed income trading. goldman sachs of course coming in ahead of them again on equity trading. they also beat on investment banking with advisory and debt underwriting doing better than expected as they beat on wealth management revenues, but the pretax margin came in below expectations. it is something they are watching closely and again, it is something they are issuing a warning on. he said the wealth business is actually in my blood. he said this will be the engine for further morgan stanley growth. shares down again almost the most in three months at one point. >> bloomberg's su keenan with the latest from the banks. let's take a look at some of the other corporate stories we are following. spirit airlines shares losing almost half of their value after

a u.s. federal judge blocked jetblue's takeover. the court ruled the combination would stifle competition and the ruling follows a trial in november we are government lawyers argued that the merger would eliminate a key incentive for bigger airlines to offer budget friendly fares. uniqlo is suing -- accusing the retailer of copying its popular bag. they uniqlo parent says operators must immediately cease sales of imitation products and compensate for damages. it is the latest established taylor to sue shein since last year over alleged copyright infringement. more to come here on "daybreak asia." this is bloomberg. ♪

>> the top geopolitical stories that we are following today, another commercial ship has reportedly been hit by a missile in the red sea. the second in 24 hours. the greek owned carrier was hit about 122 kilometers northwest in yemen. meanwhile, the u.s. says its forces destroyed four who see -- houthi missiles. if they are proposing a new tax deal with taiwan. the risks angering beijing. the measure wouldn't reduce withholding taxes on qualified taiwanese residents doing business in the u.s. the agreement will fall short of a formal trading bill as the u.s. does not recognize taiwan as a sovereign nation. beijing is sensitive to any moves by washington it perceives

as supporting an independent taiwan. volodymyr zelenskyy is calling for more international aid and investment in the face of the ongoing conflict with russia. speaking with global and financial leaders in davos, he called vladimir putin a predator and said strengthening kyiv would "strengthen your security. in a bid to boost financial support for ukraine, he also met with j.p. morgan jamie dimon, steve schwarzman, and bridgewater founder ray dalio. secretary-general yann stoltenberg says the u.s. will sustain a military alliance regardless of this year's elections and threats by donald trump to exit. he spoke to bloomberg, detailing the spending hikes over the past decade and the importance of keeping up support for ukraine. >> the good news now is that they are investing more. >> you think this was a wake-up call?

>> absolutely. first of all, we made an important decision when russia went into ukraine the first time and annexed crimea and took parts. we agreed to increase our defense spending and since 2014, allies have increased defense spending substantially that after a full-fledged invasion in 2022, they started to do even more. the result is more and more allies are spending 2% of gdp or even more on defense. we are at 450 billion next three u.s. dollars for defense across europe and canada and they are in the advanced weapons systems, f-35, air defense systems. most to protect nato territory but also to be able to continue to provide supplies to ukraine. >> what is the ask specifically from zelenskyy? >> to get more weapons and more

sustainment of those weapons so this is about, you know, deploying new air defense batteries, artillery, and so on, but this war is now becoming a war of attrition, meaning it is not only about imploring new systems but also ensuring you have enough ammunition, enough spare parts and maintenance and allies are doing exactly that. we are also working with the ukrainian defense to increase production inside ukraine. so yes, it is a huge task. we should not underestimate russia in anyway but we have to remember where it started. when the full-fledged invasion happened in february, most experts believed putin was going to take control of kyiv in days and ukraine within weeks. that did not happen. the ukrainians have liberated roughly 50% of the territory russia occupied in the beginning. >> the feeling in washington is this last supplemental it will be the last one. we are going into an election year. it is a deeply divided political situation.

what happens into 2025? how can ukraine sustain itself without the backing of the united states? >> wars are by nature unpredictable and nobody can see how this war will end or when it will end but what we do know is that we cannot allow president putin to win. >> nato secretary-general speaking with annmarie hordern. take a look at our futures in europe and how they are opening up of the moment. we did see european stocks already sliding for two straight sessions on the back of higher bond yields. fresh doubts over the timing, the scope of interest rate cuts more regionally relevant to what the ecb does as well. really underscoring how fragile the euro area economy has been but still, bond yields rose after we heard from one ecb governing council member about

>> we are waiting for the nonoil domestic export numbers out of singapore, supposed to drop at the bottom of the hour for the month of december. we are not getting those, but of course -- this of course coming after we saw exports growth returning to singapore for the month of november for the first time in more than a year. we will continue to watch for those numbers although we are not getting them at this point, but tell us what is happening in the markets because it still seems a little bit of a mixed picture. annabelle: clear outperformance of japan versus what else is happening in the market today because if you take a look at the gmm here, you can see a fair bit of red across the screen so far this morning. what is really standing out to us so far, the moves that we have been bond yields because we

have got the treasury 10 year continuing to hold above that 4% mark. we had the fed governor overnight really moving the markets because he says that we are not going to see any sort of rate cuts from the fed or he is arguing the case for no rate cuts until inflation is very much in the rearview mirror so possibly towards the end of this year but pushing back on those expectations of six cuts from traders in 2024, so bond yields are moving higher when you have that sort of scenario. that puts pressure -- upward pressure on the dollar so you do see a lot of currencies here as well moving to the downside so far. again, that puts pressure on equities. parsing the kospi, for instance, flipping yet again into negative territory, down or than 1% at this stage. the stand out, as you can see here, is very much japanese equities. the nikkei trading up 1.3 percent and one of the dynamics playing into that is again that currency weakness because the japanese yen, around its 100 day moving average but down .2%

against the dollar so far this morning. that is really helping, as you can see japanese equities exporting names. we are tracking another sector in particular today that is really prompting those gains. let's take a look at japanese chipmakers. we had amd, for instance, a price target upgrade from barclays overnight that led to the stock jumping and the optimism around japanese equities generally. japan and a fitting from corporate governance reforms, benefiting from geopolitical tension so it is moving to the upside as investors just continue to divest away from chinese equities and part of that comes down to the economic outlook. haidi: so much of it comes down to the economic outlook. we will be getting the latest domestic activity number, retail sales, fixed asset investment, industrial production, also the 2023 gdp numbers in less than two hours today. earlier, the chinese premier

said the economy grew around 5.2% last year so -- surpassing beijing's target. take a quick look at some of the broader broadcast in terms of expectations for this years domestic activity growth. we are seeing the highs just shy of 5%, the sort of most bearish expectations coming from the likes of anz and morgan stanley at just over 4% there. our next guest has been expecting flatly better growth of 5.3% for a greater china economist -- that is for 2023. of course, michelle, beyond the headline number which is not that compelling, if you lift the hood, what are you looking for in terms of the domestic activity indicators and if they potentially tell us that the worst is behind the chinese economy question michelle: first of --economy? michelle: first of all, the growth number is 5.2 percent

which means the year on year growth for the fourth quarter is likely to be somewhere around 5% to 5.2% which means that for the quarter on quarter basis, there's probably some moderation compared to the third quarter, but that is understandable because in the second quarter, we have big deterioration but overall, it tells us that the second half of last year, the growth momentum has been stabilizing after the deterioration in the second quarter. and what i will be looking for is whether there's continued sluggish momentum in retail sales because we do know that the consumer confidence has been deteriorating because of the house price correction and i think that is really what i will be focusing on. >> the bigger kind of existential issues, what is going on with the property sector, whether they can deleverage their bubble, you know, in a steady way that does not cause a further shock to the broader economy, you -- are you confident that that can be

played out? michelle: this is our base case but i think that downside risk to the situation, because if you look at the house price data from the national statistics or even from the other data providers, it does show that the house price momentum has been falling in the fourth quarter and that is the easy measures that were announced by the pboc to lower their mortgage interest rates, to lower the down payment ratio's, so i think a concern here is that if the house prices continue to fall, that could further deter the home willingness to buy property sales and that could further deteriorate a little bit here in the developers and the funding conditions and i think this is somewhat a downside risk that is building that i think policymakers are also -- there still a lot of policymakers can do. we have seen announcements

towards the end of the last year and i think this will be -- this could put an effective backstop to ease the concepts of the homebuyers over the property buyers. >> the one trillion yuan sale of special sovereign bonds that we have also heard about, in your mind, does this signify a meaningful fiscal support? is it still more targeted? every investor we speak to at the moment are still on the sidelines when it comes to chinese risk assets until they see what they call meaningful stimulus. michelle: yes, i think first of all on the fiscal stimulus, we really have to look at the overall package put out by the government because essentially, there is the on budget fiscal deficit numbers, which has been raised to 3.8% of gdp last year and also local government bonds and then added to the

announcement from the government on the cg bees as speculated yesterday. so overall, we will need to wait to see the overall fiscal numbers but it does signal that the government is willing to step up their policy support if there is a continuation in growth and i think it also needs to put into context what kind of growth target we will have for 2024 which i think is likely to be around 5%. >> how do you lift confidence? that is one of the main kind of heads grantors at the moment both for households, consumers, and businesses in china. if you are in the middle of a deflationary downside, downward cycle or a spiral, i should say, how do you improve outlook? michelle: it is actually not easy to lift confidence right now because china is facing structural problems where there

has been too much debt because of overinvestment either in infrastructure or the property sector and the have also been some putdowns in the private sectors that are still really devaluing the confidence. it takes time for these confidence to come back and on the upside, we are seeing policymakers trying very hard to announce some policy measures to support the private sector but i think at the end of the day, first of all, i think as a short-term measure, it would be fascinating to see more stimulus coming through for policymakers such as the monetary easing bonds and as we see, the extension of the psl landing last december and also the fiscal stimulus which we already have the announcement for the possible announcement for the policymakers that ctb could be coming up. i think at the end of the day, we still really need to solve

the problem of the property sector which is to essentially speed up the debt restructuring to make sure that homebuyers who want to upgrade or if there's any kind of structural demand, they are not concerned about the developers not being able to hand over the projects. i think supporting the findings to developers will be key here. >> michelle lam, greater china economist at societe generale with us. really great to have your insights are course as we get into the next couple of hours. we will get those domestic activity indicators in the final gdp numbers as well for 2023 from china. let's take a look at how all of this is playing into the market opens. our asian equities reporter, charlotte yen, joins us now. xi jinping wants a stronger yuan and digesting all of the data

that we are expected to get as well. is any of this likely to meaningfully change sentiment when it comes to how in chinese markets are trading? charlotte: i think that might be a bit difficult if we look at the nasdaq index which is one that tracks chinese companies listed in the u.s., it is down 3.8% and that is the biggest drop in four months. while some of the is playing catch-up because u.s. markets were closed on monday, still, you can see investors are not -- i think they are not pressing too much of a meaningful price from the data dump we are going to get today. with gdp figures, the fourth quarter, investors are likely just to look past that given the year-over-year base effect that last year this time -- last year, the fourth quarter in 2020 still very much -- it had impact affected by the pandemic, more likely to focus on december activities data and whether it was industrial or retail sales

or property sales, i think investors are still pretty conscious given a lot of the high-frequency. they got month summer months momentum for economic activity is which are still struggling. >> will valuations take a difference? when you are investing in markets, you are always thinking, is it still relatively cheaper or better than other economies? charlotte: i think evaluation wise if you look across the space, and for some of the really pretty good companies, especially the internet space, strong fundamentals and valuations, definitely. the strongest argument for chinese bullish -- china boris are clinging onto this but with that said, we don't -- we have not been able to see valuations driving any meaningful flow back into this market. i think we still need more patience to see, you know, the broader economic situation getting better, especially with

deflationary wish is what's a big risk investors are parsing now as we have seen across different sectors with consumers and internet companies, they have been engaging in this intense pricing competition to win over consumer demand and that is a big headwind investors see for company earnings. >> charlotte yang there. we are getting nonoil domestic numbers out of singapore, which we were expecting at the bottom of the hour, but finally for the month of december, a contraction of 1.5%, which is very disappointing to economist forecasts, which were expected for growth of 1%. also given that singapore's exports had finally returned to growth for the first time in more than a year they november, we are again seeing it contract 1.5% for the month of december. month on month, those numbers have been more volatile and again, this is this appointing economist expectations and it is also a contraction of two .8%. electronic exports year on year,

the contraction has used a little bit from the previous month but it is still in the negative. 11.7% contraction for the month of december. so this is a little bit disappointing to economist expectations but perhaps not terribly surprising because when we saw those growth numbers return for the previous month, it was really mainly to do because of a low base and we know that global electronics demand continues to be sluggish and we are seeing again more examples of that with singapore's nonoil domestic exports surprising to the downside. this is bloomberg. ♪ hey, doc, quick question. if you had to choose, would you give yourself a root canal or run payroll? run payroll, no question. you know how tough payroll can be, right? no. we switched to gusto, and paying my team couldn't be easier. gusto gives me unlimited payroll runs, next day direct deposits, and automatically files my taxes. ooh, taxes! sounds like you know the drill. good one!

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>> take a look at how japanese assets are trading early in the session. we are seeing the nikkei and the topix gain more than 1%. and it comes to the nikkei, it is the best base since january 12 and we are seeing a rebound from losses in the previous session. japanese yen continues to weaken against the u.s. dollar, not surprising given the dollar index had the best day since march on those rising treasury yields. we are seeing the japanese yen holding at that 147 level and of course, we have been watching those yields in jgb's, given the rise in treasury yields here. we saw the 10 year yield in the u.s. top 4%. of course all eyes on what the

bank of japan will do next and with the bank of japan expected to unwind a decade of monetary easing this year at some point, it is suddenly exciting to be a trader in japan again. brokerage is are staffing up, often seeking out veterans who can remember when japan last had positive rates. senior fx and rates reporter ruth carson joins us now with more. tell us more about what or rather who is becoming the hottest commodities in tokyo right now? ruth: absolutely. japan markets are booming. there is no way to look around that. topix at 34 year high. jgb yields touching nearly 1%, and as a result, banks, fund managers, brokerages, they are looking to beef up but there is a snag. the last time japan actually experienced positive interest rates was in the 1990's so trying to find people, this hot

commodity, traders, investors, who have traded through this period, it is hard. these people have retired, some of them are no longer working or are in different countries, so banks and companies are doing all they can come with throwing so much weight into hiring and training people to get back on this train of what inflation means for japan markets. >> what are some of the examples of the company's sword traders that are really looking to make the absolute most of rising interest in japan at the moment? ruth: absolutely. there's plenty of examples, haidi, and our reporting shows that. just to name a few, ken griffin's sitting belt, for instance, is looking to set up a tokyo office and they shut down 10 years ago. sean fields, the same. we have got examples of concordia which is a regional letter, for example, really the thing up their training programs to traders and employees and even outside of japan, there's

plenty of examples to j.p. morgan traders and rates for japan which have set up a hedge fund called brahman capital in singapore to cash in on this. they are looking to trade jgb's. it is all super exciting. all eyes are on japan. >> do those veteran traders have any advice for the young ones as they have their first true taste of inflation? ruth: i think a lot of people have plenty of the former markets head for mizuho in japan has this address for people. he likens the current conditions to that of a typhoon. you know it is coming but you don't know how hard it's going to hit or when. be prepared. another example is mr. yen, as he is known. when i spoke with him, he said it is incredibly hard to draw parallels even with the 1990's or even the 1980's so people

just have to be incredibly flexible and just be prepared for the unknown and that is the best way to go about it. >> great way to be prepared. our senior fx and rates reporter there with today's big take on the bloomberg terminal. you can find that at bloomberg.com as well. plenty more to come. this is bloomberg. ♪ the first time you made a sale online with godaddy was also the first time you heard of a town named dinosaur, colorado. we just got an order from dinosaur, colorado. start an easy to build, powerful website for free with a partner that always puts you first. start for free at godaddy.com ♪ (upbeat music) ♪ ( ♪♪ ) ( ♪♪ ) ( ♪♪ )

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>> aia is a brilliant tool for people to be more productive. now, it means the bad guys will be more productive so they can do more cyberattacks, they can design weapons. have got to make sure the best ai for cyber defense or measures to defend against bioterrorism are in the hands of the good guys, and you know, it is a challenge, but people sometimes lose sight of the fact that this is the biggest productivity advance in our lifetimes. >> bill gates speaking there about ai at the world economic forum meeting in dallas. -- davos.

shares of indian software giant have started the new year on a high after better-than-expected sales. last quarter surprised investors. we spoke with the executive chair and asked him whether that momentum can continue. frexit has been a tough year last year for the tech services industry. the good news is i find and i am hopeful that 2024 will be a better year than 2023 and we just announced results last week , we were at the top end of our guidance compared to what we thought so we saw some decent execution versus what we saw from customers as well but a couple of things that give me some comfort, one is just the conversations with customers and how they are thinking about their tech spend for 2024 and the other is just the way our consulting business is starting to see some uptick, right, and if i look at a large consulting organization that we bought a few years ago, they have seen double-digit auto booking growth last quarter. to me, that is an important early green shoot indication of perhaps where spends can go.

having said that, i'm still cautiously optimistic. i am washing it closely -- watching it closely but i'm hoping 2024 could look better than 2023. >> you talked about having some comfort. what are the risks? what is keeping you up at night? >> the environment is a difficult environment. have a fragile economy. i think the u.s. is looking a little better. as we speak, europe is quite uncertain. you have a large chunk of the world going into elections and that creates uncertainty, including india. we have this environment with the geopolitical situation, conflict situation, and you have the whole world being disrupted with ai and what happens with ai governments and how do you think about having structure and transparency and safety from naia perspective? there's lots of uncertain elements out there. these also become opportunities for us certainly if you look at ai and how customers think about it. it can be a huge opportunity as you move forward.

if i look at what happened last year with ai, we had 80 to 100 poc's where customers were experimenting and i find more and more customers are really thinking about real business impact as they go into 2024 so that can be the opportunity on the plus side as we move into an environment that is a little bit more favorable generally as well. quick to talk about opportunities in ai. -- >> you talk about opportunities in ai. >> i think it is becoming all pervasive on two fronts. one i think for organizations itself, we are disrupting ourselves with ai. we committed to put ai in every thing we do. we have completely transformed the way we sell our own employees leveraging ai and today i can go and apply for my own leaves, as for my own form 16, my tax forms, without having to engage with anybody else in the office, to click through 10 screens, and we are seeing tremendous number of use cases

built from an experienced standpoint for employees, dramatic change in how we are generating content for our marketing efforts, tremendous structure in how we are generating sales material. how can we have our response is completely generated through the system? there is a tremendous amount of disruption happening internally within the organization and customers are very serious about moving from experimentation to real business impact and i expect that only to pick up with time as we move into 2024. >> the executive chair speaking with bloomberg's haslinda amin in davos. take a look at what futures are doing at the moment as we have about one hour to go for china gdp and activity data. we are seeing some downside across the board. bloomberg markets china open is next. this is bloomberg. ♪

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