dani: this is "bloomberg daybreak: europe." happy friday. i am dani burger in london with manus cranny in dubai. these are the stories that set your agenda. manus: amazon shocks the street, projecting the slowest growth in the holiday season. the bird is free. elon musk tweets after completing his $44 billion acquisition of twitter. he will take the role of ceo and top executives -- ecb policy makers were not unanimous about the size of the record hikes. the euro has some of yesterday's plunge. more hikes on the table. >> it might be several meetings.

they determined that meeting by meeting. we note the journey, we know the destination which is not as clear as a figure you would like to pin down. we cannot do that. manus: good morning. a couple of countries between us. when it comes to big oil, ecuador delivers an extra dividend. if you arrive there you get an extraordinary cash dividend. the buyback continues. it is a boost for shareholders. good morning. dani: good morning. this comes off the back of some strong earnings. it continues. the big earnings for oil companies and the rising chaos.

we are going to speak with anders opedal, the ceo of equinor. that is at 6:30 a.m. manus: two point seven $8 billion in the last year. 11% of gas to europe is up this year. that gives you an idea of the monster move. equities, our wounded beast. tech, the flesh wound of all. they played in the nasdaq. dani: such a difficult week. whether it is added giants. asia-pacific index follows what we see on wall street. it is all about tech. look at the underperformance of those futures.

they are down compared to the half percent. what is that from? most likely from amazon. slowest growth in the company's history. the cfo saying they are tightening their belts. manus: the bond market has reacted. there is softer inflation with the ecb not being unanimous. i take you to the 10 year bond. you are looking at nearly 30 basis points. the biggest decline since march of 2020. two dovish hikes. that to me is a red warning flag. how worried are we getting ready ?

their view on the oil markets. i think there is a concern over the global growth dollar. the yen has rallied over the past two sessions. cable is flat. there is a lot to chew on. dani: there certainly is. let's do our best to get through. matt is here with us on the latest with the twitter takeover. michelle will break down action from the boj to the ecb. annabelle takes a look at asian markets. manus: elon musk completed the $44 billion take over at twitter. amazon and apple -- amazon battered by 20%. matt is with us on tech watch.

what a story on twitter. read headlines are coming in fastest morning. if we reflect on broader tech, i think it is a big warning shock about the quarter to come. >> i think you are right. i think the results were quite similar. it was 15% between 2% and 8% in the holiday quarter. really anticipating a sharp slowdown in consumer spending. quite a gloomy outlook. dani: back to twitter. i am trying to look at some headlines here. a shakeup of management. how should we view all this?

>> we have not had official confirmation that the deal has closed. he is planning to take the helm. i think it was a big surprise. he is planning on being the personal project for sometime time now. whether that means he will insert -- and reinstate people immediately, we will have to wait and see. dani: i do not doubt that. thank you for joining us. from a tech to the ecb, it hiked 75 basis points. officials were not unanimous about the size of the increase. that has reunited debate that peak interest rates are on the horizon. let's bring in michelle. some words i am tired of saying. peak and pivot are two of them. is it right to bring that back?

>> correct. how about that forward guidance, if you can call it that. a very tricky situation. our colleagues are grading -- getting that great scoop that three officials did not want to go to the 75 they want to go smaller at 50. they also took issue at the reference to standard progress. that signals what you're talking about, moving into a different phase here and slowing down the rate hikes. i think you heard from lagarde, it does not give you a confident conclusion that we are there yet. a lot of factors are in the mix. she did mention meetings possible. she also said we had more groundcover. we are not done with the fight yet.

there may be time to slow down. central banks are already moving. all that is on the table. they might discuss the tightening which still lingers in the background as the next step in the cycle to wind down. manus: i think she does not want to have to do that trichet. they do not want to have to do that. it just will not blink. you can throw whatever you want at it. they are not moving it at all. 2% next year. we are going to just throw more money at it. >> yes, still not taking the --

the debate and bond bullying we saw over the summer. even when they are performing as expected, we are still waiting for the press conference in a couple hours. that will be one to watch. last month it sounded a bit too dovish and prompted the finance minister -- barely half hour when he ended the press conference. they supported the yen for the first time in 24 years. probably seeking to avoid that type of scenario. we should hear more color on that provision. and with the path is going forward. they want to see a little more of it in a society that has seen low prices for so long. manus: they are open for

tourism. japan is the most gorgeous place ago. not that many tourists there just yet. markets are moving. what have you got? >> just speaking on some of those things you were discussing. they are really being driven by those amazon results. lackluster holiday forecast. when you look at this, r atlee -- when you look at this, we are looking at that red. it does point to some of the bigger themes that we have been discussing. we do see that weaker dollar. we saw that pullback and treasuries. there is a retreat in the asian

bond space. there is a continuing question we have around chinese stocks. are we looking at a feast or a trap? they are down about 2.8%. where you find yourself could depend on where you're from. you can see that chinese investors are still buying into the index. we are talking about inflows and net basis. 17 straight days of buying. dani: thank you very much. annabelle in hong kong. coming up, our peak global rates on the horizon. we will discuss what is next for central banks around the world. we will do that with paul donovan from ubs. this is bloomberg.

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dani: u.s. gdp rose in the third quarter. speaking after that, resident biden said americans are better off. pres. biden: today gdp results came out in the economy is growing. it grew at a two part 6 -- 2.6% rate last quarter. incomes went up last quarter. dani: more data from last quarter. here to help us make sense of it is paul donovan from ubs. i am struggling to make sense of this. you had a pickup but the housing is starting to slow. unemployment refuses to budge.

how are you making sense of the u.s. economy? paul: we know there has been a big problem. the pandemic has made that worse. the u.s. economy has contracted in the first half. it accelerated in the third quarter. this is a mirror image. the panel of growth will be far more sensible. i think that is a stronger first half and the third quarter. the economy overall is leveraging household balance sheets. that has been the trend the last

few months. we are still seeing consumers using pandemic era savings to support consumer spending when all of that is clearly slowing down. manus: good morning. the one thing i am obsessed about is housing. i lived through a number of housing crisis. my memory goes to benchmarks. housing has dropped in the latest numbers. am i right to see that is a worrying sign of a bigger slowdown which is yet to unfold? americans typically use their housing as credit cards. 7%, i put it to you is a risk

that we have not seen in years. paul: i do not think it is quite as bad as that. the u.s. economy is not that sensitive overall. unlike other economies, if you have a mortgage, you tend to fix it. you tend to fix it in the last couple of years and then you're paying a next to nothing. if you are a new homeowner, you are being confronted with mortgage rates and you may be rethinking that. there are a lot of other cascades of effects in the economy. buying washing machines, televisions. absolutely, the housing sector is the most interesting. the atm machine was such a big feature.

that has largely disappeared the cycle. the refinancing you are suggesting is in a far wider sector of the community and economy. it is not like that this time. not so good for furniture and other consumer retells -- retailers. it is not the same as the contest free from 2007 -- 2008. dani: with the american consumer, i want to play you some sound from the amazon ceo. take a listen. >> we are optimistic about the holiday but we are realistic that there are various factors weighing on people's wallets. i am not sure how strong holiday spending will be from last year. dani: they're predicting their slowest holiday record on quarter. how much do you extrapolate from

that into the wider picture of the american consumer? paul: i think you have to be really careful here. in 2021 there was a phenomenal surge in the bonds for consumer goods. that was exceptional. that was because people were comfortable spending on travel, leisure. there is a really strong surge and spending for goods. this year, we have had an absolute -- we must go on holiday. kids deserve a holiday. that is what people have been saying. people have been going away from goods toward services. the fact that amazon is

predicting sales is not going to translate one -- 1 for 1 because we are rebalancing buying stocks versus having fun metrics. that is going to work against a company like amazon. there is a slowdown in consumer demand. that is going to have an impact. i do not think it is something we can take with what the amazon cfo is saying. amazon is not the u.s. economy. manus: i love that. stay with us. i'm relieved to know that that cash machine is close. paul donovan, chief economist at ubs. we have more to do. the ecb jumbo rate hike.

christine lagarde says more increases are ahead. we discuss on bloomberg. ♪

manus: ecb delivered a jumbo rate hike. more increases ahead. we understand that that decision was not unanimous. three policymakers arguing for a smaller 50 base point increase. does that make sense to paul donovan, global chief economist at ubs? we reflected on the hike, hike, hike narrative at the u.s. with the lack of unity coming from the ecb. you see that as perhaps good governments rather than a

dereliction of duty. explain. paul: we are in a situation where it is more sensitive than the united states but is facing the same sort of challenges. we the energy crisis, the impact giving a certain amount of demand. we're in the midst of the biggest structure of people in 250 years. data and real-time is increasingly unreliable. you have a lot of uncertainty about what is going on in real-time. this idea of relentlessly hiking without pausing to try and assess how those interest rate hikes have affected the economy might change the outlook, i think that is dangerous. it is sensible to be talking now

about pausing or slowing the pace in order to reflect on existing policy moves and what they have done to the economy. dani: this is not the ecb story or you have disagreements. we have heard from the fed. this at mean this proclivity to rally on the back of this, to have a global rally, not just in europe, is perhaps a head fake? i have to come back to this, if the fed does seem like there are no disagreements among the ranks? paul: the fed tapers over there disagreements. quite often you have something different than what is being reported. in the market reaction, it is understandable. the central banks have taken

away the bumpers of forward guidance. they say that they will do whatever they want besides what they told us. that was the whole message of the june policy that means that now we are seeing markets moving around in the wind of it. that is going to be unnecessary volatility but it will be a continued feature for markets for the foreseeable future. manus: one minute. we are looking at electricity prices in france and germany going to run out. how materially important is this drop in prices on the energy side to the real economy? paul: it does make a difference

to the corporate side, less of a difference to the consumer side. some of the damage has already been done to consumer confidence. two companies, it will make a meaningful difference. dani: thank you very much. manus: we will see how that plays out. dani: it is an important point that we are constantly trying to get a handle on these energy markets. thank you so much. paul donovan, global chief economist at ebs. we will speak to the ceo of equinor, anders opedal after millions have made the switch from the big three to the best kept secret in wireless: xfinity mobile. that means millions are saving hundreds a year with the fastest mobile service. and now, introducing, the best price for two lines of unlimited. just $30 per line.

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manus: it's your friday edition of daybreak europe with manus cranny, that's me, and dani. dani: amazon shocks the street, projecting the slowest ever growth for the season while apple warns of a slowdown. elon musk will take the role of c.e.o. at twitter, bloomberg reports, after pleating the contentious $44 billion deal he feel also plans to scrap permanent bans on users. ermt c.b. policymakers weren't unanimous in the size of the rate hike with several wanting a smaller increase. >> it might well be several meetings. how several is that will be determined, meeting by meeting. we know the path. we know the journey. we know the destination, which

is not as clear as a figure that you would like to pin down. because we cannot do that. manus: christine lagarde,ed of the e.c.b. equinor beat estimates to boost its extraordinary dividend. it's going to come in at 70 cents from 50-cents for the third quarter. a two-cent boost. let's get anders opeddal, why did you not increase the ordinary dividend? we have this extra dividend but why not move on the ordinary dividend? and does that just say it's a one and done moment for equinor? good morning. anders: good morning to both of you. yes, we are increasing the extraordinary dividend. we normally look into the long-term dividend plan every

fourth quarter and then we're also looking into kind of how we are adjusting the fixed dividend. so this will come in more when we do our capital market update in february. for now we have the record results of $24.3 billion u.s. dollars in adjusted earnings. we continue to informs and continue to provide a competitive dividend to shareholders. dani: considering you have a record profit coming in here, i understand that you usually on a calendar basis evaluate the regular dividend further on. what would prevent you from upping that regular dividend at this moment considering what the third quarter looked like? anders: it's just kind of the way we work. the regular dividend is based on the long-term underlying earnings. we are working on looking into the long-term underlying earnings. that's why we always do that the

same as we do the capital market update. but we see good outlook for oil and gas business and also investing opportunities in renewables. so this is something we will look hard into and more around the capital market. manus: we're all just going to have to wait and see on that. but obviously inherent in that is not just oil prices and production, but gas. 35% of your production is in gas. prices have rolled on from their highs in august. we want to get you to give us your view going forward. you're shipping hard and heavy into europe. your outlook for those shipments and for the gas market going into 2023, anders? anders: so what we are doing, continue focusing on providing gas to europe. that's our main priority. safe and efficient producing of gas. that's really important when we also see the incidents in the

baltic sea and we see drone activity in norway. so safe, efficient production of europe -- to europe of gas is priority. and we do see changes in the gas mark at the moment. we have spent quite a lot of time producing gas, for instance, to germany. the gas stonch filled up. we have mild weather at the moment. so we see an easing of the gas prices. but of course the fundamentals of lack of gas in europe is still there. and we will see kind of a strengthening of the gas prices as we move into the winter and see colder weather. dani: do you expect that strengthening to get back to the august peak levels? anders: that's difficult to say. also to predict actually. what we think will happen is that the gas market will continue to be quite volatile.

the weather in asia, the weather in europe, the gas storage level, there's a lot of factors. still there is a gas coming in from russia. we don't know what will happen there as well. so we have to expect that will be continued volatile market in the gas, what we are focusing on is to ensure at least what we can do is to be a stable and reliable supplier of gas to europe. manus: there's lots of big themes we need to try to grapple with. i appreciate that your tax rate is in the 70's already. and so maybe to ask you, are you ready for a windfall tax might be a dumb question. but i want your perspective as a global c.e.o. of a global oil major. shell are readying themselves for bigger windfall taxes. is this what should be expected from you as an industry? is there a risk of additional tax grab on ex-y -- on equinor?

your view of windfall taxes per se. anders: we almost pay a permanent windfall tax in norway of 78%. and also the tax regime in norway is quite stable. at that level going forward. we also have a profit levee in u.k. that we are paying these days. but i think in this very special circumstances, government needs to do something. i think it's kind of -- energy companies duty to produce as much energy as possible to try to make sure the prices are as low as possible and affordable to people. at the same time the governments need to redistribute wealth. so we expect the discussion about a windfall tax. the most important thing about the windfall tax, it is predictable, we know when it will enter, we know when it will be over because of course any

changes to the framework will alter our views on future investments. this is a long-term business. so predictability also when we see windfall taxes will be highly appreciated. dani: anders, does that mean that you and your peers should be preparing for a new and continued era of increased regulation? anders: what we have seen is quite a lot of change in regulatory. of course we are preparing for it. but with most of our mechanic coming from norway where we have 78% tax already, already paying windfall tax in u.k., this will have limited effect on equinor if windfall taxes are further strengthened in europe. manus: the price cap the g-7 are considering for russia. the deputy pliem minister told me he thought there'd be a short-term drop in russian production. what's the consequence of a price cap in your view?

the function of the market and flow of oil, i want to know about the flow of oil as a result of a price cap. what's your best thought, best guess? manus: well, you know, any price cap is not really solving the fundamental problems. to kind of really give me supply. in fact it can be counterproductive increasing the demand while the supply is not increasing. generally speaking, both oil and gas, we don't think price caps will solve it. it's about, you know, continued investing and investing more in energy that will be the solutions here. regarding the g-7 price cap of oil, quite a lot of disturbance in logistics of oil going forward. and it's too early to say but there's a danger at oil prices will go up with the price cap. dani: so you mentioned a couple

of times this idea that it is your duty to deliver safe, reliable energy to europe. you mentioned the suspected sabotage of the in orderstream pipeline -- of the nordstream pipeline. what steps are you taking to guarantee that security? anders: first of all we work very, very closely with the norwegian government about the security of the pipeline installations. we have seen a lot of drone activities offshore. this is far away from onshore. it's not kind of boys playing with drums. this is some people with high capabilities are out there. scouting. at the same time we have seen sabotage from -- on the nordstreams. so we are working with the government and government is working with other major allies to make sure we have presence of military vessels in the

norwegian continental shelf and we're also doing quite a lot of inspections as well to ensure that everything is safe. the most important thing is that everyone working on the ince laigs can feel safe when they fly out in helicopter and working on the installations. together with the prime minister of norway i also -- one of the only installations a couple of weeks ago to ensure it is safe to work with, safe and reliable providing energy to europe. dani: ok, anders, thank you very much. we have to leave it there. anders opeddal, c.e.o. of equinor. v.w. now coming in, it is a disappointing figure. they had seen deliveries up 5% to 10%. now they'll see deliveries flat. similar to the prior year. margin also coming under pressure. 7% to 8 1/2%. the estimate had been for 8.4%. manus: dani, they identify

semiconductors undersupply, i don't think there's any shock, but supply bottlenecks. they expect those semiconductor supplies to improve into the fourth quarter. this is what we're beginning to hear incrementally from c.e.o.'s. that perhaps as china steps back a little bit on zero covid whether they do or don't, that could change the supply chain market perspective. in terms of rest they have flow, the economic outlook darkens. v.w. joins ford with a surprise decision this week to cease all activities with u.s. driverless vehicle company argo. there's a number of different things going on with v.w. but i think the supply chain is probably the biggest thing we have there. the stock, let's just see how it's indicated to open on the start of trade. dani, margin is important as well. operating margin, 6%. below estimates, isn't it? dani: are you read writing mind? that's exactly where i wanted to go. cost pressures a big issue here

not just for volkswagen but everyone. part of the cost pressures they have seen, they did have some one-off charges of business in russia. but cost pressures myanmar gins are weaker than expected. manus: ok. what have we got? we're going to kick in a little bit more on the u.s. economy. dani, the feds' preferred gauge of inflation is expected to hit the tape. 5.2% later today. could be make or break for the big, bad bond market. this is bloomberg.

manus: the feds' preferred gauge of u.s. inflation core p.c.e. is expected to come out later today. any surprise to that figure will ric lite the -- ignite the

debate over when the fed will pivot. let's bring in jana randow. how critical is this for the debate between 75 and 50 as the next two moves from the fed or perhaps the need for something bigger if it's a dislocated number? jana: it's something to watch very, very closely. inflation has come down from the peaks that we've seen over the summer. but it is running strong and if you compare that with a relatively strong performance of the economy in the third quarter, growth was faster than expected, actually. the labor market is robust. or continues to be robust. then that really underpins the case for forceful action at the feds' next meeting. economists are expecting a hike of 75 basis points, that will be

the fourth time in a row and at the moment there's very little to suggest that we'll see something less. but the economy is quite difficult to read. a lot is happening there. we're seeing that private spending, it is still relatively strong but it is coming down so we're seeing that, we're seeing that the rate hikes of the past are feeding into the mortgage market, into the housing market, that one is cooling. there are some signs that the feds' policy is showing effect so for now we haven't heard much, you know, about a pivot, policymakers have stressed they need to be strong on inflation and power through. but there have been some voices, marely daley, for example, saying we should start thinking and planning about maybe slowing down the pace except for the data right now don't warrant such a move.

dani: perhaps the fed is more united in this desire to keep going at it but e.c.b. yesterday, a great scoop from the team there, that there were disagreements among e.c.b. policymakers. what does that suggest to us about europe's path of rates going forward? jana: it's a very similar situation. inflation is strong. the economy is on track to fall into a recession in the winter half just because of the energy crisis we're facing here and that will of course keep, you know, keep the e.c.b. on edge. right now, their focus is on inflation. inflation is too high. there was little doubt that they were going to move by another 75 basis points. but in those dissenting voices you can see that the discussion, as we approach neutral, as we talk about going maybe into restrictive and as we talk about

potentially starting q.t. at some point in the not too distant future that this discussion about how to run monetary policy in a world with high inflation and a shaky economy is getting ever more complicated. of course they are concerned about going too far, about doing too much and having to pivot and repeating mistakes they've done in the past. dani: ok. thank you very much. manus: appreciate it. 2008, you need to be younger to remember that tragedy. dani: i've read enough about it. i was in high school, manus. i was but a teenager. jana, thank you so much. jana: it wasn't pretty. that i can tell you. manus: no, it wasn't. dani: it's very serious. all right, jana, thank you very

much. manus, let's save ourselves here. more breaking earnings coming on the tape. manus: you can never have enough oil, i say. resident of the u.a.e. eni delivers their, 3.73 billion. they were expecting 3.219 p the production side. we are just seeing the numbers come in. 1.58 billion barrels. energy supply and security are critical. with ejust had that conversation with the equinor c.e.o. how is italy gathering its gas supplies? we're going to put that question to the c.e.o. of eni. they say the $2.4 billion buyback will be completed by the end of the year. claud yea, are going to do a new buyback, we have that interview, claudio descalzi joins the team

on energy and the price of oil. dani: can i just say you have some fantastic interviews on deck. i encourage everyone to stay tuned with us next week to see those. a little plug for manus there. a plug for the rest of the show. no christmas cheer. amazon predicts its lowest ever growth for the holiday season. apple also warns after a slowdown. and to top it off the latest on elon musk's twitter takeover. we'll try dig through that next. this is bloomberg. ♪

manus: big bad tech earnings. amazon prompting the slowest ever growth for the holiday season. apple warned of a slowdown. elon musk will take on the role of c.e.o. of twitter after

completing the contentious $44 billion deal. matt, it's a feast of tech. but i'm gorging on twitter. should we resurrect and retweet donald trump. he's about to review the lifetime bans, isn't he? matt: the bird is free, he tweeted. seems that has happened. he already sacked the c.e.o. and c.f.o., installing himself as c.e.o. i'm sure the day will have a lot more tweets maybe from elon musk himself and developments about how he'll take that business forward. it was interesting yesterday, they wrote a long letter to the world of advertisers trying to reassure them all that twitter would continue to be a good place for them to invest for their brands. i think it's going to be an interesting day and an interesting few weeks and months to see how twitter evolved.

dani: almost feels like we get a live view into that, for those on twitter, to see how it changes. amazon, earnings creator. i had written down how much everyone's wealth evaporated. some tough numbers. matt: it's been an incredible week for the tech stocks. amazon grew about 15%. they're talking about growth of only 2% to 8% in the final quarter. the market was looking for 3%. it's really a big slowdown and a big difference versus expectations. i think really stunning people with how much of an impact they expect to see on consumer spending in that holiday season. dani: to be fair, paul opeddal just told us it might be the move from goods to services. we'll see how that plays out,

but not so much in amazon's favor. manus, we've had a lot of earnings this hour. let's try to go through some of them. perhaps we kick it off with v.w. here. growth when it comes -- or their forecast missing expectations, it's now going to be flat. estimates had been for sales to push higher. manus: they've still got cost pressures. margin compression. chip supply. bottlenecks. and of course russia as well. and a permit of $1. billion on their argo investment and that is knocking those numbers. on the airplane side, we've got airbus. they're hopeful about the future combat aircraft accord later this year. chinese site assembly. first-ever a-321. another back loaded year for airbus. the c.e.o. says going into 2023.

dani: and of course we spoke with equinor who also released earnings, beating estimates, boosting shareholder payout. all that cash flow coming in strong because of prices. he ebasically told us he sees the tax regime staying steady and saying price caps won't solve the problem of supply. manus: yeah, i think that was probably the most interesting. let's see what the price cap actually is as the americans debate within g-7 in terms of where the right price is. it's a monster day for tech but also a monster week for banks. which makes it even better. we've got an exclusive conversation with the c.e.o. of barclay's at 7:00 a.m. london time here on bloomberg. ♪

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