>> this is bloomberg day drake -- daybreak europe. >> good morning morning. the 75 basis point question. >> shifting goals. russia looks to annex occupied ukraine. >> tech takes a plunge. the hang seng slides.

>> inflation is pretty calm but that belies the fact that it could get pretty wild and chaotic today. >> calm for now but for how long? let's get our market check. i want to look at aussie assets. this could be a preview of what's to come for u.s. assets. three year yacht -- aussie yields high, bonds sliding after the rba decision yesterday which really amped things up, hiking more than expected for the rba. today, strong retail data. the rba opened the door for more rate hike so the market is taking that instep. will that happen with the fed? we are seeing brent crude and wti move higher, up more than 1%. europe is contemplating a russia oil embargo, looking at annexing

more of ukraine. the slowdown in china, the embargo story winning out. >> the dollar, pretty steady. when you speak to a lot of people on the trading floor, some traders don't know how to trade inflation. it will be interesting to see how jay powell is hawkish and what that means for what kind of interpretation the traders have. across the board, u.s. futures subdued, investors bracing for the biggest fed interest rate hike since 2003. they want to know clues on how pugnacious lee -- pugnaciously they will tackle this. s&p futures not really moving much but treasury futures dipping after the u.s. 10 year yield closed near 3% yesterday. >> pugnacious, that is nice.

let's get our top stories and our reporters from around the world. we will talk to enda curran to preview the rate decision. the latest developments in ukraine, juliette saly has market reaction to the probe of didi's new york decision, plus the leaked supreme court document on roe v. wade. francine: we are joined by enda curran. what are we expecting from the fed? what comes after the hike? >> 50 basis points appears to be locked in by the fed. that would be the biggest hike since the year 2000. we have details on how they plan to run off the balance sheet, $9 trillion. that is the other part of the story in the u.s., what will they do with the securities and how quickly will they shrink the

balance sheet? we would also have chairman pebbles first in person press conference in two years since the pandemic began. he will come on and he will be peppered with questions on the outlook. that will be a critical take away, not just the rate hike but how many are in the system, how fast and how hard will the fed go from here. much expectation in terms of signals. dani: any opportunity for voluntarily. -- for volatility. to ukraine. there are reports the kremlin will be holding referendums in russian occupied areas to open the way for full annexation. we are joined by roz matheson. it is almost 10 weeks into the war. what do we know about president putin's aims to achieve in terms of the outcome? roz: he expected it to be over a lot faster.

they will have to recalibrate where they go from here. russian officials say they are focusing on tenex that territory entirely. they are acknowledging right now, they don't actually even truly control that territory. you can't have a referendum until you do so. it is possible we could see this stretch on for months, may years before russia achieves what they see as narrow goals. francine: thank you so much. roz matheson. markets in mainland china remain closed. tech stocks in hong kong falling for a second day. let's get to juliette saly who has the details. the sec probe dampening sentiment.

juliette: absolutely. it has been battered by regulatory headwinds. didi global has a chaotic filing, and it doesn't know the outcome, the timing, the consequences of the probe that has sent stock on the hang seng lower for a second session and reversing the rally we saw last week when beijing tried to prove it would have support during this. significant weakness from big tech, the likes of alibaba and tencent. let's look at how that impacted the hang seng, which has started showing signs of a rebound. it is lower, off by around 60% from february but we are starting to see momentum come through. this probe is hurting sentiment at a fragile time. dani: thanks so much.

juliette saly in singapore. president biden urged the election of more lawmakers who support abortion rights and will seek to enshrine protections into law. this with a 6-3 majority supreme court looking to overturn roe v. wade. democrats lack the votes to pass that sort of legislation even by a simple majority. joining us is bruce einhorn. this comes as midterms in the u.s. are underway. we are getting results from the gop in ohio. how does this change the political landscape? bruce: it could change things a lot because until now, the assumption has been the republicans had a huge advantage going into the midterms. voters were motivated to go to the polls, republicans seemed on track to regain control of the house and the senate. suddenly, you have a lot of democrats who might not have paid that much attention to the

possibility that roe v. wade was under threat to are now paying attention. but we will see from democrats efforts to get people to the polls. that could mean a major change in the battle for control of congress in the fall. francine: feels like an earthquake. thanks, bruce. let's take a look at key things markets are watching. 10:00 a.m. u.k. time, retail sales figures, smc revealing its rate decision. it is the boomers that have the upper hand. trading, it he can tell you what it was like at the time. the eia releases its crude inventory report plus first-quarter results from cbs, regeneron, moderna and uber. dani: imagine trying to report

when it is all about the fed. francine: no one sees my inventory data, no one notices. dani: lucky for us, we have hours to go until the fed so our conversation will continue. francine and i will speak to a ceo on first-quarter results, smashing expectations. that interview is next. this is bloomberg. ♪

dani: this is bloomberg daybreak europe. francine: norwegian energy giant equinor reported earnings that beat estimates. we are joined by the ceo anders opedal. thanks for joining us. it has been 12 months but you

also tried to increase gas production. i imagine the situation in ukraine makes it more pressing. how much can it increase by? anders: the war in ukraine is affecting the gas market in europe. what we have done over the last i would say nine months, really is looking for every well we can use to increase production of gas to europe. this quarter compared to last year we increased gas production from, by 10%. in addition, we added another 5-6 pcm of gas to europe. dani: have your customers been reaching out to you concerned, trying to secure more supply? anders: yes. we have constantly, customers talking about securing supply from us.

we are in a very good dialogue. we have been relied on for decades to europe and for us it is important to deliver gas at the same level as we do at the moment for now, but also to be a reliable provider of gas in the future, meaning we will have to also continue exploring in the continental shelf to make sure we can keep up the level of production we have today. francine: you are sitting on a lot of cash. what will you do with the cash? given a lot of countries in europe are trying to stop their reliance on russian gas and oil, what does this mean for the transition? anders: for the cash, we are investing in our future. we have an attractive portfolio within oil and gas but also within renewables, particularly in the u.k. where we are investing in the world's biggest offshore wind park.

it is important that we are able to invest in oil and gas to ensure we have enough energy while we are transitioning, but we should continue to ensure we invest even more over time in renewables and hydrogen and storage technology. we will invest about 20% of our investment this year in renewables, and we will gradually increase that over to 30% in 2025. dani: clearly these big results is allowing you to make that investment. looking at how rich oil and gas prices are, are you concerned they are not sustainable, these types of results are not sustainable? anders: it is really kind of, there are customers on the other side and we see that we can sustain high gas prices, high

oil prices. we might see demand instruction and we see economic growth. so i think going forward, we have to make sure we invest in enough energy in the world, both oil and gas but particularly increase investment in renewables. we want to ensure we can have both energy that is affordable. it is more did carbonized and secure energy for different countries. francine: how would you characterize the energy situation in europe? is it critical as we speak about certain sectors and countries having to ration oil and gas if there was an embargo? anders: it is a difficult situation at the moment. first of all, we have the supply crunch that we saw actually before the war in ukraine, then the war is adding to this will

european countries try to transition away from russian oil and gas. so that is why it is so important. all i can do is ensure at equinor we try to provide as much energy as possible and we are trying to invest in the future to do our part to contribute to the energy crisis being reduced. dani: setting aside what you have already done, if there were to be a full embargo of russian energy to the west, what impact would that have on your business? anders: for our business, we wouldn't necessarily have a big impact but for european businesses it would be dramatic. we see a lot of gas is used in european industry and i think we will see european industry will have to close down and losing

jobs, etc. so i think it is important that europe continues to diversify in terms of gas, to ensure, and diversify where we source gas from but also diversify in terms of different energy forms europe will depend on in the future. dani: thanks for your time. appreciate you joining us. let's get to the first word news with juliette saly. juliette: residents of beijing are being urged not to leave the city unnecessarily as the chinese capital ramps up covid restrictions. school is suspended for the next week for in person classes. in shanghai, the final exit from a five week lockdown is delayed. there is a strict quarantine. a survey suggests pay for workers u.k. surged.

according to the institute for fiscal studi, average monthly wages and finance were 31% higher in february compared to 2019, compared to 14% across the economy. elon musk says twitter will remain free for casual users, but government and commercial users may see a slight cost to stay on the platform. the wall street journal reports the billionaire told potential investors he could return twitter to the public market as soon as three years after buying it. global news 24 hours per day, on-air and on quick take by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. dani: juliette saly in singapore. coming up, investors are bracing for the biggest fed rate hike in more than 20 years. this is bloomberg. ♪

>> we don't think this is the last decade of the 1970's. returns will be lower and we will have to work hard for clients to find opportunities. >> multi family in the u.s. is having an incredible year. we are seeing double digit rent growth across the country and it is not letting up. it is a big component of inflation, the cost of housing. >> we have been hiring. last year we brought in a senior leader with strong expertise and there is -- it has gotten more difficult during the pandemic. >> we have attracted unique talent because of the global preposition and because we have unique leverage points like the way we can bring our strategic partner to bear on helping companies do better. >> we will have wage inflation starting this summer so i'm not

going to say the word stagflation. it is a low risk but it has to be in the vocabulary for next year. there is nothing you can invest, no opportunity when you are in a stagflation environment. francine: some of the voices at a global conference in california talking about the risks and opportunities of investing and operating in a high inflation environment. markets are gearing up around the world for the federal reserve to carry out its first basis point hike since 2000. it is expected to start reducing its balance sheet. someone keeping a close eye is the fund manager at a company. when it comes to the decision, it is all about the forward guidance. what are the risks we will get a more hawkish surprise? >> looking at yesterday's

numbers, durable goods, factory goods, record numbers of open jobs, it will be around that language of how quickly they intend -- they expect to lower the fed balance sheet itself. i think we are gearing up more and more, as the ceo explained, inflation is coming in the fed needs to do something. they need to show they will be stronger. francine: i see it is fully priced in for june, july and september. jay powell, is he afraid of going up 75 basis points? >> he is not that type of guy. he usually talks strongly. he doesn't want to disrupt what is a strong recovery going forward. inflation is high. he stopped using the word transitory so maybe he has the impression that the pressure

will start to come off going forward. . dani: i'm waiting for them to change the word to pugnaciously. if you want to do something big, 75 basis points and then you think about it. dani: is it not at this point, something you need to do, you need to prepare for an even more hawkish, aggressive fed? >> i don't think they are there yet. the language might increase. they hawkish rate rise, given jay powell's history he seems to be a more cautious individual. francine: do we need caution, or will it lead to policy mistakes? as a fund manager how do you get through that? >> looking at the bank of england at the same time, we are living in the shadow of central banks.

stocks are going to be heard but we need to look more fundamentally at the economy. the reopening, all the huge numbers, mgm came out with positive numbers. we saw the green area, solar reporting results, but remain focused on those. the fed will do what it will do but continue to look at how the economy is working. dani: let me challenge you additionally on the fundamental story. bank of america says sentiment on earnings called among banks is its weakest since 2020, the start of the pandemic. do you see a shift in corporate america towards a more gloomy world? >> there is trepidation. the increase in commodity prices, inflation going up, and what will probably hit us is the price chain issues associated

with china's lockdown, which hasn't manifested yet when it comes to results. but there is a word of caution where management says we will see problems coming through. francine: that was ugly when that came out of nowhere. we have conversations, we spoke to executives and they say executives don't know how to deal with inflation. they don't know how to pass it on to customers. is there worry that next earning season, it is a bloodbath? >> if we look at proctor and gamble and some companies, they fundamentally touch a lot of human beings in terms of everything we eat. they have vast distribution, commodity prices, this is what they do. you have start -- started to see them take price rises and inflation. i think the key is inflation

can't continue to increase any more than it is now. then it becomes problematic. dani: 45 seconds, is the consumer willing to pay more if these companies raise prices further? >> so far it looks like they are. during the lockdown, the amount of savings accrued, the consumer has more leeway. if the inflation continues to persist at this level, especially in europe or energy costs are vastly increasing, it turns problematic. francine: thank you very much. one of the big points, we spoke to a unilever executive and they said if i raise points and some of the prices, is there a danger they go to the consumer at some point and the consumer goes to cheaper brands? dani: that's the issue with luxury goods. will consumers pay for expensive things when they are looking at

more expensive housing and energy? francine: this is the question. a man who doesn't shy away from talking about inflation, jamie dimon. we sit down with him and we will talk inflation, the fed, brexit and energy with jamie dimon.

dani: good morning, this is bloomberg: daybreak europe. these are the stories that set dani: your agenda. dani:the 75 basis point question, how high and how fast? francine: russia looks to occupy ukraine, narrowing its objective. dani: the hang seng slides as the sec probes the chaotic 2021

debut in new york. francine: let's get straight to it to look at the futures and give us a good indication of what traders should be watching out for. equity futures subdued, embrace -- investors bracing for the biggest fed interest-rate hike since 2000. the clue will be in what jay powell says on how high they will does how strong they will tackle inflation. the dollar holding nearer to your high over all. this is reflecting something you're watching. dani: it is a call market so far. how much of it is just about waiting for the fed, he thinks 50 basis points, it could beat shock and awe. if it is, i wanto show us with the australian market is doing. basically everything else is pretty common. look at the foreign bonds column, you will notice aussie bonds are spiking.

this is because the rba has said we will hike. we are not on the preplanned path. if the economic data is strong, inflation is strong, all bets are off. similar language from the fed. we could see that volatility continue. brent crude up more than 1%. francine, it's very calm, but there is chance for volatility. i want to bring up a chart highlighting that chance. at the moment i'm looking at the cpsc data, when it comes to treasuries for real money and fast money. as asset managers, still long. at the same time, hedge funds, diverge funds, growing to the extent where the difference between these is added most extreme since 2020. if the market turns against one of these traders, let's say the fed is more dovish, we could see

extreme short covering from hedge funds. this just shows that could go either way. with more analysis, gearing up for the federal reserve to do its first they fit -- 50 basis point rate hike since they are 2000, it's been 22 years since we had such a move. that would also mean it starts rapidly reducing its balance sheet. we know what we are expecting, which is a half a point, the fed move is already priced in. what if they do 75 basis point? >> i think that would be a surprise. all expectations and the guidance have been toward 50 basis hike move. 75 is on the table, i think that move would be seen as a step too far for the moment. the bigger interest today will be on the balance sheet side of things, about $8.9 trillion?

, how quickly are they going to shrink that balance sheet now? they're expected to begin that runoff, it's a the biggest boost since the word -- since the year 2000, but also the first press conference in the pandemic began. that will be an opportunity for reporters to get a sense as to how hawkish powell is. whatever statement he gives from the press conference, where we go from there will be just as important as a 50 basis point hike decided today. dani: speaking to the surveillance team yesterday, we discussed the need for the fed to move to 4% or 5% to tame inflation. are we hearing more of these extreme expectations of the fed going forward? >> this is where the fed has debated, you heard him saying it

is out of control and the u.s.. the central bank, not just the fed, is been too slow to get up where inflation is that. they have a lot of work to do to get ahead of the curve. nominally, they need to? rates. that means the economy will slow down. there is a concern that the fed and others to have a lot of work ahead of them. signaling from chairman powell today. that raises the question, what would mean for economic growth? the trade-off to growth is slow, is it enough to delay recession, that is another point others have made. the head of new zealand's central bank, with interest rates going the way they are, with all the challenges facing the world and the economy right now, growth is high in one direction, and there is risk of an overheard lining, when you hear people talk about the fight doing -- fed doing 75 basis

point, they talk about hard landing. dani: i think it's interesting, we had that fed today and then the boe is on deck as well. are they also a preview of what's to come for the fed, if they have to pull back to to economic concerns in the u.k.? >> francine: they say the problem is it feels like the central banks are scared of the markets. everything has been -- they always need to give indication to the market, it doesn't give them enough tools to do the shock and awe that maybe we need when inflation is at 8%. dani: they probably need a more chutzpah. one person who has plan chutzpah is our editor, when you look at the set up into today's, as the market all talked up? is there a chance for more

aggressive high-priced in. >> one of the things track -- i think so, but the fed shall -- chair signals for the next hike, it will open up a discussion about the possibility of a 75 basis point hike at the next meeting from the fed, i think it is about evenly priced in the market at the moment whether they would do that or stick with a 50 basis point hike, i think the market is watching to see whether fed -- paul pushes back on that leaves that door open. -- powell pushes back on that leaves the door open. he will allow the -- may allow the market to believe more is coming on the horizon.

francine: you need a flat spot get the central banks express, let's go. when you look at what they could do with the $8.9 trillion balance sheet, what is the biggest policy mistake they could do now? not hike enough for hike too much? -- for hike too much? >> if you're worried about inflation, not sticking to their guns now and easing up before they really wrestled the inflation problem back down to earth would be seen as particularly alarming. we need confidence in the fed, and the central bank, that they can wrestle inflation back to the floor. probably that is the most important thing. if they do look lilly livered, that would be the bigger risk to the market. on the other hand, to aggressive , and we are going to see the continuation of the bond selloffs of the high-yield

feeding back into equity markets, a very fine balancing act. the fed needs to be convincing, but it also needs to be measured. who knows what the right messaging is going to be echo dani: an even stronger dollar, doesn't it really have more room to go? >> look at the euro or the end, the biggest constituents the dollar measures are both weakening at the moment. the chinese yuan, coming up against as well. the back to go further, when the bank of japan is sticking to its guns, when china is starting to ease as well, it really gives that dollar momentum an extra push. people are focused now on euro, when does the ecb start to

signal, when is it going to start joining the hiking party as well. these are some of the key things to look for. dani: do you think inflation is out of control? if you look at china, if they continued on the path we see, this is going to be very inflationary for europe. francine: we could have a game changer tomorrow if there were peace in the ukraine. >> and if the grain prices start to come up for example. yes, we might see continuing energy prices, but some of that commodity sounds to come away, something to watch is jobs and wage growth numbers, if those become entrenched, and we are seeing a strong pattern of wage growth, that might be a good thing not short-term basis, if it becomes radical numbers, the policy makers need to worry about it more.

i think everything is to play part -- we need the messaging from the policymakers that they can get inflation under control again. francine: i'll tell you what's convincing, my cappuccino, went up a dollar 50 cents -- paul dobson. there's inflation everywhere. dani: there really is. starbucks talking about inflation and their coffee, they were getting people like you are still happy to path. francine: with the bloomberg first word news in singapore, juliette saly. laura: bloomberg has learned of russia planning a hastily planned referendum and some areas of ukraine to open the way for full annexation. almost 10 weeks since the war, where told the kremlin is focused on cementing political

control of the donbas. on the diplomatic front, french president emmanuel macron held a two hour call with vladimir putin, telling him to -- about allowing evacuations to continue for mariupol. following news the supreme court is going to strike down roe v. wade in an address, harris argued the court decision on abortion would open the door to stripping other rights, including same-sex marriage. >> women's rights in america are under attack. how dare they tell a woman what she can do and not do with her own body? how dare they? how dare they try to stop her from determining her own future? how dare they? try to deny women their rights and their freedoms. >> gains around the extended

straight after posting first quarter sales, the hog assessment, the company faces -- after more than two years of covered restrictions. comparable sales, it missed estimates and slows for specialist quarter as -- comparable sales roles 7% globally. we seek will was -- companies focusing on stress business. 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. this is bloomberg. dani: thanks so much, juliette saly in singapore. coming up, you're talking without severely sick, ceo of jewelry maker pandora. this is bloomberg. ♪

dani: welcome back to bloomberg: daybreak europe. jewelry maker pandora has reported first-quarter earnings above estimates, at the same time it narrowed its full year revenue forecast from between 4% and 6% to 3% to 6%. joining us now is the ceos of alexander lacik. strong results that beat expectations, given this, where has your geographical shift moved from given issues in eastern europe and asia? alexander: first about, we are pleased with the fact that it's a broad base across all her product platforms, as well as an all our core markets. eastern europe and in particular

russia and belarus represent less than 1% of our revenue. we have not been duly affected by the crisis there. in our core markets in europe and u.s., we had a good development in the quarter. dani: can you give us an idea, do you actually have operations in russia and what do you think will happen? do they take over? is it appropriation of some of the goods? it is unclear to us exactly what the russian authorities are expecting to do with companies that decide to leave that country. alexander: we have always been operating through partner, a distributor there. those stores are not owned by us. it is a wholesale set up, we sell product to them, they do merchandising and retail operation on the ground. we suspended our business when russia invaded ukraine on february 24. dani: when it comes to sourcing

things, a third of the world gets its diamonds from russia, you previously told your suppliers to avoid russia and belarus, has that happened? are your suppliers no longer buying materials from those areas? alexander: i think it is important to note the type of dominance we are talking about our mind diamonds, we don't -- we only use lab created diamonds, we have nothing at our supply chains being sourced out of russia or belarus. francine: how much does this rock material inflation impact you? what does it mean for how you operate? change materials, hike prices? alexander: first of all, we are an energy light business, the raw material in our case is silver. it is world market price. we are hedging this move. we have forward rates, there's a

touch of impact, it is not major, probably where it hits us a little bit is on freight rate. our products are very light, so we air transport around the world. this is not major component. we have some merchandising material come out of china, those rates have, somewhat -- have gone up so much. we are absorbing this. total effect is nearly 2 million danish krone or in our case. dani: what about the second impact -- second order impact to the consumer? in this current environment, it won't be long before people are shamed because they buy expensive items they don't need. will pandora customers be shamed for buying expensive charm bracelets? alexander: i certainly don't hope so. our products are typically gifted to people that are having

an anniversary or birthday or something along those lines, that has been tried and tested part of the industry segment for many years. within the last couple crises, this part of the industry doesn't have massive dent due to this. we shall see what the future holds, we have a good value proposition, we may see some people trading down from more expensive goods. then i think pandora is an attractive offer for people looking for a nice gift. francine: i have a nine-year-old badgering me for some of the stuff from your harry potter line. have a marble superhero, harry potter, and these license agreements make you a lot of money? how does it work? what's next? alexander: these collaborations as we call them, they make up

anywhere between 5% and 10% of our revenue stream across the last couple of years. it's an ebb and flow depending on how strong these collaborations are. the margin profile for these products is the same as for the rest of our lineup. that level of business is probably a reasonable size. i don't want to overtake the pandora brand, it's a nice addition to what we do. francine: i can see her with harry potter. alexander, on inflation, raw material costs. coming up, they hit $60 million, bringing that back to earth. we bring you that story next. this is bloomberg. ♪

francine: this is bloomberg: daybreak europe. tiger globals performance problems are mounting, the firm losing $16 million during the first four months of the year. the company's main hatch, decline 15% in april, extending the loss 24%, what's going on, i thought they could do no wrong? >> really the last decade or so, [indiscernible] really in dire straits. down 50%, down $16 billion, extraordinary to watch. dani: tiger is all about tech. are we now in a scenario where the business mark -- business model is that? -- is debt?

>> they're probably going to stick to their guns, the big tech stocks, and the private market valuations, francine: it is extraordinary to see declines, sending stock funds -- shockwaves through that, how did they do so badly so quickly? >> when tech has gone up so much, everyone is piling in. mike goes down, i think it is down two thirds from my last ticket market account. dani: these are the bull market darlings there are no longer paying off. that contrasts with macro hedge funds. there is a wide variety in terms of who is doing what -- who is doing well, what defines the performers? >> it's a trend in the markets,

there's macro hedge funds, which have done poorly in the flavor of the month, you see it reverse the macro funds. francine: is there strategy they could do, dani: bonds could work as a hedge. francine: he would still come on at 6:00? dani: when you have this environment where tech is not working, bonds are not working, macro can't hedge, this is kind of data they make their money on? >> it will be a big day, the market is watching it close, it is going to make big money on these big calls. dani: or lose a lot of money. that's true. this market does go both ways. tom, thanks for joining us. i do have this feeling it is an opportunity. i was talking about real money and fast money, they are

opposite sides of the spectrum, somebody is going to get hurt today. francine: don fund the bloomberg from the 80's, go talk to them. dani: that is it for francine and me. bloomberg markets: european open next. this is bloomberg. ♪ as a business owner, your bottom line

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>> good morning, welcome to bloomberg markets: european open cash trading less than an hour wait, here are your headlines. the 75 basis point question, when the fed hikes, how high and how fast? russia narrowing its objective in your pain. not a huge earnings day in europe on the corporate agenda, we talk