after a large fire ripped through a two-family house. two people were taken to local hospitals. officials warn the numbers could grow as firefighters inspect the public housing structure. officials say the building had poor smoke alarms come but they did appear to be working. president biden will mark the first anniversary of the deadly capitol insurrection, seeking to rally democrats around voting rights legislation. he will say that inaction risks involving extremist followers of former--emboldening extremist followers of former president trump. the president and his allies in congress plan a full slate of events on thursday marking the january 6 riot, preaching unity to a politically fractured nation and members of his own party. the chicago public school system has canceled classes after the city's teachers union voted to shift to remote learning on tuesday. about 73% of the votes were in favor of the move. union officials say remote

instruction will end when either the covid-19 surge subsides or mayor lori lightfoot's team signs an agreement on conditions that are voted on and approved by the teachers union. with russia's formidable military presence at its border, ukraine's army is reportedly preparing for a possible high- intensity conflict. ukraine's military is stronger than in 2014, when it couldn't resist russia's annexation of crimea, but a lack of weapons and underspending at home have left its troops without deep stocks of some basic supplies. the united states has said it would supply weapons should rush attack--russia attack. global news 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. ♪

>> is 1:00 p.m. in new york, 6:00 p.m. in london. i'm alix steel, in ferment miller. welcome to "bloomberg markets." your other top market stories we are following from all around the world. the tech rout continues, extending the selloff as yields push higher. we have kathy and whistle of morgan stanley joining us within outlook for the you could hong kong imposes strict virus control measures for the first time in over a year as the omicron variant threatens to spur a winter way. then we go to ces las vegas to speak to the ceo of an electric vehicle maker on how they will take on tesla. all that and more coming up. let's check on the markets. we are an hour away from getting the minutes from the fed. the tech rout it's worse and worse. s&p 500 down by .3%.

just to see how ugly it looks, nasdaq is off 1.4%, right around the lows of the session. on the flipside, the rotation into value is quite strong pit you have the russell 1000 value index, .6%. it is outperforming the nasdaq by the most in months. they beat the growth index for the first time since 1995. that is a stark comparison. it raises questions of are we going to see this relocation to value that we've been talking about for four years? on market was a little mixed earlier in the session and now we have selling across the board. more pronounced in different end, there's in the front furniture, but the backend tried to catch up. want to welcome the managing director at morgan stanley private wealth. good to talk you about this.

what is driving the markets? ultimate choice -- is it reopening, position adjustment, or normalization policy trade? >> i think it is c, normalization policy trade. i do think that over the last year, everyone had covid at the top of their minds. we think since last april there has been some deceleration, that is part of the normal business cycles. now we need to pay attention to those normal business cycles and look for the opportunities there. it makes complete sense that we are starting to see selloffs in tech and some of the companies that have done quite well last year and move into value. we are looking to do that for our clients as well we are looking to peel off a lot of the gains in growth, repositioning back into value. it has been such a big run for growth over the last few years that it has imbalanced

portfolios, and we need to bring them back to balance. alix: what does that look like? you sell bank stocks and you go by banks and energy? get specific on it. kathy: i would say you definitely want to get out of big technology names that are overcooked or overpriced and go into the bank stocks, financials, health care, and reit's, too. reit's a really good play for inflation as an inflation hedge. those of the areas we are looking to reposition clients into. i would like to point out that individual companies are going to be where we find

same was mostly true. a flood of the growth of the gains in the market have come from just a few names. we want to rethink that and think about this coming year and position towards really good quality companies, not only backward-looking numbers, but forward-looking numbers have to be positive, too. alix: that means you have to probably take a view on inflation and what the fed is going to do. it feels like the narrative is becoming that the fed can hike, but not going to be able to hike as fast as the market thought just a few weeks ago. where do you stand on that and where will we get in an hours time? kathy: i think we are not expecting -- it is going to be faster than we expected. back in march 2020, we saw the fed lift up the economy, literally carried the economy for us. that gave investors a lot of confidence to know that they couldn't go wrong with certain investments and they could stick it out and grow. now we look at the fed pull back a little bit and take some of the support away. there will come volatility and maybe a little bit of lack of confidence in what is to come. we know that markets never like uncertainty, so that is where we will see some volatility. i look at this locations as great opportunities to reposition and put clients in those areas we are telling them we like them to be in for 2022. alix: where does this leave the likes of corporate credit? issuance has been crazy the last

few days, whether the high-yield or the investment grade market, taking advantage of the window before the fed does anything. is there a way to take advantage, as you are still going to need yields? we'll yields are still negative. kathy: great question, and what we are looking at is if you look at the past couple years, there has not been too much of a disparity between the high yields in the normal orbit credit. i believe that is because of the fed supporting all of these different types of bond issuances. we will see more volatility there. you have to be cautious about holding those fixed-income positions that are more high-yield and a little riskier that you have not been paid for that risk. it might be time to look at that and put some of those off the table. in terms of fixed income in general, it has been really tough and it will continue to be tough until the rates start to go up a little bit more. we are looking at more short-term duration type of investing for the time being and looking at alternative ways to find income to put into your portfolio. alix: where in fixed income can you do that? kathy: well, not in fixed income per se. you are getting 2.5% on a dividend-paying stocks come that is more than the yield you are getting on corporate fixed income right now. we are also looking at alternative investments like market neutral or hedge funds, things like that, even ways for clients to find -- different ways for clans to find the cash flow without the risk of taking on all equities.

finding other areas to invest. alix: thanks so much. i enjoy talking to you, kathy entwistle of morgan stanley private wealth. we are waiting new york governor kathy hochul's first state address as governor. want to bring in shelly banjo on what to expect. one of the headlines?--what are the headlines? shelly: this will be kathy hochul's first state of the state address to new york since she took over from andrew cuomo when he resigned. she is looking at health care, taxes, lowering taxes for the middle class residents, helping out with things like childcare and filling gaps in areas of health care that we have seen crater during the covid crisis. alix: and then to that point, it looks like specifically accelerating tax cuts for the middle class new yorkers, things like ending the 421 rental

tax abatement, $10 billion for new york health care and bonuses. is this going to go over well? are people going to like these initiatives? shelly: the think she has going for her is the state has a lot of pandemic stimulus money. she has room for programs without having to find money for that elsewhere in no way her predecessor had to do. things like health care, that will help her shore up support from the health care lobby. she is going to need it when she runs for election in 2022 this year. it is a pretty controversial tax credit that most folks in new york city know about because of what it does, it was meant to help with affordable housing, but what it ends up doing was become a tax loophole for real-estate developers.

what she did was say i am going to fix this and change this, which is something controversial, but she didn't give the details yet. the devil really will be in the details to see how she is going to change that. alix: looking forward to that. we will bring you headlines that may come out. shelly, thanks very much. shelly banjo joining us for some coming up, we will go to hong kong banning fights and closing bars as it tries to contain the spread of omicron. it is a zero-tolerance covid policy. this is bloomberg. ♪

alix: this is "bloomberg markets ." i'm alix steel. hong kong is going to ban

flights from 8 countries including the u.k. and the u.s. and shut bars for two weeks as the city battles the omicron covid variant could want to bring in the bloomberg new economy editorial director. you see different regions in china with millions of people having to shut down as well with the zero-tolerance covid policy. why is that still the policy? >> one is locking down 13 million people. hong kong has gone into semi lockdown after discovering a single case suspected to be omicron. the priority for the hong kong authorities to align with mainland china is zero-covid strategy, which is the reason why xian is in the lockdown right now. this is going to imply a rolling series of lockdowns,

quarantines, economic destructions by the way through this year and into next year as well. alix: are relearning anything about the efficacy of vaccines that remain in china? or vaccine take up? what is the logical excellent nation? >> -- explanation? >> couple things going on. vaccines are universally available in hong kong. quite a lot of people have had the chinese vaccine, which is not as effective against omicron as the mrna vaccines. we are seeing a lot of vaccine hesitancy in hong kong, particularly among the elderly. only 20% of 80-plus-year-old hong kong people have been vaccinated. some of that is due to misinformation, disinformation, stories going around that a lot of people are dying after getting the vaccine, it also

lack of trust in government and government experts, including health care experts, and that dates back to the 2019 pro-democracy demonstrations and movement that is getting crushed the government. -- crushed by the government. alix: having 13 million people shut down and shutting down gyms and bars, what is going to be the political, fiscal impulse to that? night there will have to be some kind of backstop. andrew: i don't know that there is a backstop. they have taken the view that there -- they are going to stick with a zero-covid policy and they will stick through that with the olympics, incredibly important event for president xi jinping. unlikely they will come out of lockdown ahead of that. the question is from the public health perspective, is it a practical policy. countries all over the world including singapore, new

zealand, australia, decided last year it was impossible. that was before omicron, which is more transmissible than delta. alix: interesting to see how long they can keep that up. andrew browne, really appreciate that. check out bloomberg economy daily. sign up at bloomberg.com. i read it every day. we will headed to the ces conference in las vegas, where vinfast is unveiling its new vehicle lineup. this is bloomberg. ♪

alix: this is "bloomberg markets ." i'm alix steel. vinfast is debuting the

company's full electric vehicle lineup in las vegas today. want to get to those details with the vinfast vice chairwoman. really appreciate it. it is another entrance into the market in the u.s. walk me through your announcement today. >> thank you, alix. i can't get too much into details, but we are announcing the vehicles today for the midsized suv and full-sized suv. we are announcing the policy and the benefits that come with it. going to go electric at the end of this year. lots of exciting announcements in a few hours.

alix: can you tell us the pricing yet? it is getting to be a credit market. you have hundreds of billions of dollars being thrown by the big automakers into the electric vehicle space. can you compete on price? where do you fit in the spectrum? le thi: we never looked at competing with ev players. we are here to make the switch for the consumer to electric vehicles to make the globe cleaner. our price model is to that effect. for the midsized suv in the full-sized suv, the pricing would be $40,000 to $50,000, depending on the product.

and another thing is we are using the leasing model. basically we are making it easier for internal combustion engine vehicle users to switch to electric vehicles by making the upfront payment equivalent to the internal combustion engine vehicles. alix: i know you said you don't consider yourself a competitor, but there are a lot of ev's coming to market. i'm wondering, do you think just the market share explodes and there is room for everybody, or is there a specific market you are going after right now? le thi: the same way, we are building premium quality products, and we do expect that

trends from the internal combustion vehicles to electric vehicles. alix: how much money you pump into everything right now? you mentioned you will start a factor in the u.s. where are you in that? what kind of money are you looking to deploy? le thi: so far with vinfast we have put in $6 million so far. we plan a few more billion dollars for distribution network as well as development, continuing development of the vehicles. as well as the manufacture and facility. alix: where are the ipo plans in relation to that? i mentioned capital markets will be key. --i imagine capital markets will

be key. le thi: we are going to make the announcement. alix: do you have a timing on that? le thi: we are working on multiple directions right now, not just ipo. there will be something announced. alix: ok, so maybe we can -- sometime this year. ok. good enough on that. you also delivered your first ev's in december. how did it go? what kind of ramp rate and we look at? le thi: despite the challenges we did deliver on the vehicles. we are delivering about 2000 vehicles by the end of january. we have an order of 25,000 vehicles.

we look to do that by the end of the year. alix: overall, we have seen carmakers be hurt by supply chain issues. have we seen the peak, and how do you fix it? le thi: i think this applies tell us that by different need to of this year things will get better. but based on the supply chain, we have secured for our vehicles for 2022 and 2023. we feel comfortable about it . alix: thank you very much. vinfast global ceo, thank you very much. new york governor kathy hochul has started her first state address as governor. some of the things coming out right now is that she is pledging support for congestion

pricing on a gateway tunnel and tax credits for farmers and farm workers she has signed 400 bills since september. congestion pricing will be keep it you can watch more of her comments and speech on the bloomberg terminal on life go. the text selloff is right around the lows of the session. the s&p rolling over a little bit. value still outperforming. energy, financials, russell 1000 value index. yields holding steady. you have to wonder, what are we going to hear from the fed minutes about quantitative trading and the timing from the balance sheet and ending quantitative easing as well as rate hikes? all key for market participants. this is bloomberg. ♪

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mike. -- mark: they are meeting today to

discuss the of pfizer and biontech covid-19 booster shot for children ages 12 to 15. as the omicron variant continues to drive a surge across the country, expanding access to boosters for young teenagers could help officials keep schools open. a year after rolling out the fastest vaccination self a global test case. they began delivering forth doses amid a surge. infections have skyrocketed to a record level. hospitals could be overwhelmed. protests turned violent today as a jump in fuel prices fueled discontent. the demonstration started over the weekend and quickly grew.

protesters stormed the mayor's office and attempted to assert -- seized -- see the largest city. north korea appears to have launched another ballistic missile that originated on land and traveled into waters off the east coast, according to south korea's military. the missile landed in water is outside of japan's exclusive economic zone. it comes days after kim jong-un urged his state to contain covid. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. ♪

john: welcome to bloomberg markets. here are the top stories that we are following for you from all around the world. covid continues to weigh on the government, but it is not stopping democrats from pushing their agenda through congress. with covid tests still difficult to get your hands on, we'll take a look at how it is affecting your wallet. advice on what to expect from fed minutes and all -- all that and more. >> let's get a check on the major changes ahead. deciding that this reality means that mates are likely going up this year. we are seeing that weakness in technology stocks, as evidenced. some of those cyclical value names are still finding buyers.

some of the commodity stocks with oil prices higher today. when we start talking about the world of commodities, it has been a weird time for gold. there is that story of bitcoin. goldman sachs is out with interesting commentary. goldman sang that bitcoin will continue to take market share from gold as part of a broader option. taking the price prediction of $100,000 a possibility. they wrote in a note, if their share of the market where to rise to 50%, its price would increase to just over $100,000 for a compound annualized return of 17 to 18%.

alex: is bitcoin supposed to be a value like gold? or is it more of a way to make some serious returns, like a tech stock and trade with? can you be both? i do not really get that. >> i think that is a great question. when people look at the crypto world, they will often say that bitcoin is the store value one, but we saw bitcoin go up more than 20% and over the next two months, it lost more than 20% of its value. compared to gold or gemstones, or your mattress, i'm not sure where the best store value is. alex: ok. it's time for -- testing kids

are hard-to-find and now they were be even pricier. we had looking at what it all means. what is the latest with all of this? >> lifting the prices for what is a popular at-home test. this is after a deal with the government expired at the price. they were originally $14 and now kroger is raising them to $23.99. this puts them in line with prices that we have seen at cvs and walgreens. of course, this is coming at a time when covid tests are in very short supply. we are seeing a lot of those messages appearing on websites and at stories. they have said that they will be sending out 500,000,003 at-home

testing kits that you will be able to order online this month. the problem is people want them now. when i was in the u.k., you were able to get those at home covid test kids for free and quite easily from your pharmacy, but it is no surprise, going back to kroger, that they would want to list some of those prices because it will give a boost to their revenue. we have seen that revenue surging over the past year. >> who makes all the tests? how are they affected? >> abbott laboratories make it now. we have seen the revenues that the company has had. they have quadrupled based on what we had.

they got a big surge during the delta variant and it is expected that revenues could increase further. >> we appreciate her joining us there. discussing how they plan to push the voting rights agenda. this is bloomberg. ♪

alex: this is bloomberg markets. tomorrow marks the one-year anniversary since the january 6 insurrection in 2020. there will be events throughout the day. also ndc, the agenda from president biden and things like

voting rights legislation and a filibuster rule are also on the table. where does it go from here? professor, tomorrow will be a big day. it was a historic moment last year. how will democrats use tomorrow to push through their agenda for the rest of the month? >> there will be a couple of steps to this. we will hear from president biden and vice president harris, noting the historical significance of the day. biden, his administration and congress will be looking to tie it to the urgency of their legislation. from a democrat point of view, much of trump's unfounded claims of voter fraud are what led to

january 6. we need to really move forward to ensure that we have federal legislation that protects voting right. so far there have been 19 states passing laws that restrict voting access. they are looking to pass a voting act to ensure federal oversight to protect voting rights. it will be hard to do that with the senate split 50-50. john: i wonder if things will get more complicated because we will get a lot more voices this week. what do you think the message ends up being? ? thing that we learned is that trump is most likely not going to give the speech that he planned to give yes -- plan to give from mar-a-lago.

he will probably double down on his claims that the real insurrection was on election day . we will continue to report his claims of election fraud and we will quite possible that she will quite possibly position himself for a future run. most americans, the focus will be on tomorrow, on the messaging from president biden and what the u.s. can do to move on from january 26 -- january 6. a majority of americans view the day as a threat to democracy, as a day of violence, but it is split along party lines. alex: joe biden has a lot to deal with right now. his approval ratings are not good, whether handling covid, the economy or the job market,

inflation is still a worry. what is the right order of priorities? what kind of leader do we need to start seeing from president biden to restore confidence? >> one thing that biting came in, claiming to do is being a calm leader. i think that is what we will be seeing a lot of from him. for voters right now, covid is front and foremost on many people's mind. moving forward this year with the 2022 midterm elections, joe biden will need to be looking at bigger questions of how to unite the country amidst ongoing references to january 6, trying to move the country past a point that has proven to be divisive.

john: staying on that theme, countries around the world are navigating this. i suppose through the lens of the white house, in coordination with other global leaders, is there anything that you are watching right now? >> one thing that we have seen is that the cdc has changed some recommendations from the past to balance between public health needs on one hand and the real needs of workers and businesses on the other. the u.s. is trying that policy, similar to what the u.k. has been trying and restrictions that we have seen in the past, but they will be facing a lot of pushback from those who do not want to get vaccinated, who do not want to get boosted, and navigating that. the french president said he was

ready to move the country past this. it will be tough for a lot of politicians to walk that line. alex: a lot of the agenda -- what, realistically, do you think that we will see? what will get through in the next few months? >> joe manchin stated that he was not on board with the democrat bill. it does not mean it is dead. it means it is in a place that needs to be reworked and rethought. it will be broken down into smaller chunks. he stated he is pretty much on board with the climate policies that are currently in the current version of the bill and is probably on board with some of the pk and early childhood. where it gets tricky is the child tax credit.

he is wanting more restrictions on that. democrats will be looking at all of that. without joe manchin, other -- that would be tricky. john: thinking about what you see as the key themes in this first quarter jan what we just got through, what will you be watching for? quest the most pressing things are covid and the economy. moving forward, it will be how the country is able to recover, especially as we enter an election year. there is uncertainty and fear from many. there will be a lot of discussion on how to restore face in democracy. john: it is good to get your

perspective. we are going to take a quick break, but in the markets today, we are awaiting the fed minutes. we will be speaking to a former fed vice chair for his thoughts on what to expect. this is bloomberg. ♪

john myself and alex -- john: we are trying to figure out the pigs to fill out the vacancy in the federal reserve, courtesy of the white house. the team has been working hard on some of the reporting. a leading to be.

that is according to two people familiar with the matter. climate change is among them. a possible move that could please senators demanding swift action on that front. alex: that is a great point. they said it would be good news and it really gets it on climate. we had to prepare. if you add in climate, it is another extension of where things are. they are stress testing and making sure that they can handle the effects. can they wind up paying back a

loan? all of that sort of interconnects and that supervisory post. john: absolutely. thinking about the other factor out there is what we could get in terms through the minutes. when you look at wall street, inflation reality is softening holdings on some of those growth straw -- growth stocks. expectations for what we could see, there is a growing chorus of people, as soon as march, although it is up for debate. looking for more indications on pulling back on that emergency stimulus that we have seen throughout the pandemic. we will be watching for it closely. alex: when is the balance sheet

actually reduced? when did we actually see that number come down? reducing buying is one thing, but letting maturities roll off is something very different. will we see them start talking about that? the other part is the space and time between ending quantitative easing. it was to use before. does that get shrunk? how quickly? always a pleasure. thank you for joining us. that's pick up on that last point. the time drag. how long do you think that will be this time? >> i think it depends on the omicron variant. if it does not look like it is taking much of a bite out of the

economy, the time could be very short. if it does, i think the fed will hang back and see how much damage it does. i would put more weight on the first possibility. i do not say that with a great deal of confidence. i am not -- >> the way that the central bank communicates is key. that is something you have spoken with us about in the past. what did they potentially need to do at this point? >> so far, so good. they learned to handle it a lot better than they did in 2013 and already people are talking about balance sheet shrinkage.

they are talking about it without causing any panic in the market. they tend to panic at the slightest provocation. that has not happened so far. alex: the nasdaq is down pretty hard. down 1.4%. i wonder if we are seeing a tantrum. >> i think it is isolated. not that those companies are not real, but i look at the s&p 500, which you know has a huge tech wave. the nasdaq is very concentrated, and it sometimes moves divergent lee. john: in terms of the inflation

road ahead, but are you watching for? >> two things. i am looking at wage settlements and i am watching as inflationary expectations -- the latter is looking pretty good. they are up, but not very much. the wage settlements, we will have to see. they are looking a little high, but we understand why that is. alex: we are looking forward to those minutes in just a few minutes. thank you very much. that doesn't -- that does it for john and me. minutes are up next. this is bloomberg. ♪

>> the most crucial moments in the trading day. this is bloomberg markets the

close. >> it is 2:00 p.m. and we are live. i am caroline hyde. we look at the growth stocks extending. still on a rebound as yields push higher. we have you covered. we bring you the all-important fed minutes as we bring you insight into the plans for rate hikes. we take a peek inside. all that and so much more coming up. the federal reserve is releasing minutes of the meeting o