>> good morning.

this is bloomberg daybreak: europe. these are the stories that set your agenda. coping beijing. president biden is said to be preparing an executive order to limit u.s. business investment in key parts of china's economy. hawkish consensus. more fed policymakers come out in favor of another rate hike even as they monitor continuing bank strains. asia stocks follow wall street lower but futures are next. elon musk's wealth plunges almost $13 billion in a tumult chu is four hours at tesla. many twitter users lose their blue checkmarks. a space x mission ends in a dramatic explosion. a big week. another line crossing from the german software maker sap. the line on their latest earnings with a focus on the

cloud part of that business. you are looking now at first quarter non-ifi irs revenue coming in at 7.7 billion. that's a bead on the estimates of 7.36 billion. s.a.p., 3.1 8 billion on cloud. that's below the estimates of 3.2 2 billion. cloud coming in softer. overall revenues, it's a beat for this german software maker. currently 7.4 4 billion euros. they are affirming their outlook for continued operations and those are the top lines coming through from s.a.p. in the first quarter. coming up at 7:40 bst, we will speak with the chief financial officer of sap. stay tuned for that interview. let's check in on the markets

and what has been digested as these fed speakers seem to come to consensus. we are going to get another hike in may. but then we pause and hold for longer. fed officials say they want to monitor these financial conditions. here's what's interesting in term of the data picture emerging from the u.s.. are we in the hinterlands in the foothills of a recession. if you look at housing prices coming off, the softness in manufacturing, the fact that the labor market in the u.s. is now starting to weaken. we will assess that and what it means for these rate hikes going forward. as i said, tesla and the disappointment there. the benchmark down 6/10 of 1%. futures in the u.s. flat. euro stocks futures pointing to very modest gains of a 10th of 1%. a drop of close to 9% after the price cuts. the top story, some of their

premium models have now increased so pricing. they cut the likes of the model three. here's the process at board. inflation coming for from japan, slightly higher than expected. the yen up 3/10 of 2%. just above that for level. earlier in the week, 4.2. investors readjust. look at the work function on the bloomberg. that's almost back to prices before that supplies opec plus cut.

iron ore is the big commodity mover of the day. softer demands out of china. let's get to our reporters from around the world. the white house getting tough on china. fed officials backing another hike. president biden, let's start with the geopolitics. said to be aiming to sign an executive order limiting key investments by american businesses into china. let's bring in our chief north asia correspondent stephen engle. great to have you on the show. what do we know about biden planned executive order. stephen: it dovetails with the comments we got overnight from janet yellen, saying that the u.s. perhaps could expect to sacrifice economic growth in the name of national security. she had a wide-ranging speech but now we are hearing as well -- this is something that's been in the works for quite some time. we are hearing from sources that the biden administration will

essentially sign that executive order within a couple weeks ahead of the g7 leaders summit in hiroshima, japan starting on may 19. behind the now, he is said to be gaining or trying to gain support from its allies within the g7 to back such an investment restriction that would include restricting outright barring, also making u.s. companies that are doing business in china essentially in artificial intelligence and semiconductors and quantum computing. especially these chinese companies that have u.s. management. to basically curb that kind of investment. it would be another phase and what some would say united states efforts to basically limit the economic partnership because of the risk, the

national security risk of having that kind of technology fall into the hands of the chinese military. it's another phase in this crackdown that could have broad implication, particularly on venture capital and private equity as they look at investments in china and also perhaps put management controls in their. stephen: -- tom: taiwanese officials said to have urged the u.s. to tone down the rhetoric about the dangers of relying on trips made in taiwan. we will listen now to what the deputy foreign minister told bloomberg last week. >> it's a very delicate act. finding the right balance between resilience and economic efficiency. i think the u.s. and taiwan are essentially working on the process of finding balance. tom: what do we know then about

the conversations being had between officials and taiwan and their counterparts in the u.s.? stephen: it's an interesting bloomberg scoop. officials are behind-the-scenes telling u.s. officials to tone down some of this rhetoric. essentially it's hurting a bit -- hurting business in taiwan and investment into the supply chain and these big tech companies that are in taiwan like tsmc. they are investing $40 billion in a couple of plants in arizona . it's investing at least in one plant in southern kew shoe island in japan. it's diversifying. again, you look at warren buffett's berkshire hathaway, but the -- they pare down their investment by 86%. buffett saying, the management is good but the geopolitical risks are the reason mainly for doing that. that's the concern. essentially they are worried that though, secretary gina raimondo is also saying the

wrong things about the supply chain. that the supply chain from taiwan is untenable and unsafe. that kind of rhetoric might support the u.s. efforts to contain mainland china's ambitions on taiwan. 90% of the world's advance semiconductors are made in taiwan and they aren't moving other production. smaller proportion out of taiwan . most of their advanced r&d and chips will still be made in taiwan. stephen: that's the rub. 90% in terms of production of chips coming out of taiwan. stephen engle joining us out of hong kong. thank you. now, fed officials backing another rate hike as they keep an eye out for economic fallout from the banking crisis. that's as fresh emergency loan data shows financial stress test continue to linger.

we are joined bar garfield renters -- reynolds. what can you tell us about the fed's rate path, what we've been hearing from officials, and whether may is now consensus? garfield: may is very much consensus. it was already consensus for market that there will be 25 basis points in may with the possibility of another 25 basis points in june. that is on the table as far as markets are concerned. it was significant the way that we had a rafter fed officials overnight, that's almost it before we go into the client time leading into the fomc for the beginning of may. they wanted to leave us with an impression that, yes, rates are going to go up. absent a repeat of the collapse or something similar, the fed is going to hike. there is no real data that's going to be strong enough between now and then for them to

do otherwise. as i said, they've left us with a very clear message. the interest rates need to go higher because inflation remains sticky. probably you would expect, coming out of the meeting, that they will say again, we acknowledge the risks that the banking crisis has caused strains to the financial system. that will cause credit tightening. we expect some of that. that will get a summary. the fed loan officers survey will give them a fresh view on what's going on with credit conditions. even so, they will be looking at what's been going on with jobs come inflation. saying, the economy is too hot, maybe we need to hold. the data will tell us that between the may and june meeting. garfield: thank you for the

update there. space x on the corporate front. forced to blow up its own starship rocket about four minutes after liftoff when a number of engines failed. the company maintains it was a success. bloomberg's bruce einhorn joins us for the details. those dramatic pictures on the screen right now. does this complicate elon musk's goal to transport humans to mars? to what extent does it push back the timeframe? bruce: mars is not any time soon. a trip to mars. i don't think that's the big concern. let's put this in context. the starship is the biggest rocket ever made. it is larger than the saturn five rocket that took apollo astronauts to the moon. this was the first launch. musk had tried to lower

expectations a few days before the launch, saying, as long as he gets up and doesn't destroy the launchpad, we see that as a success. by that measure, it wasn't a complete failure because it did get up in the air for about four minutes before they said that the rocket was unable to detach from the booster and they blew it up. what happens next, musk center massive -- message to employees saying that he's optimistic that there will be a launch into org -- orbit. before that can happen though, the regulator is going to have to give the all clear. it issued a statement saying that it's going to be doing an investigation to make sure that there's no potential harm from a future launch. bruce: ok. -- tom: ok. the dramatic pictures we are seeing around space x. a failure on one level but the valuable data that the team will be pouring over as they gear up.

thank you. will a may hike be the last? we dig into markets and look at the fed's path ahead. how to position in this market when it comes to fixed income. that's next. this is bloomberg. ♪

>> the fed has been focused on lowering inflation which is absolutely essential if we want to support a growing economy and rising incomes. tom: michelle bowman on inflation and the feds path ahead. let's bring in gerber it gill. good morning. happy friday. thank you for joining us. we heard the officials out of the fed. the consensus that you get another hike in may. the view that you will have to hold at those levels in order to

get inflation down loss they keep a firm i on the risks within the financial system. for me, what jumped out was softer data. maybe you can push back on this or confirm it. it feels like we are now in the foothills of a recession in the u.s.. when we look at house prices coming off, the softness in manufacturing, even the labor market is starting to look one rubble, is that where we are at now? >> hi. first of all, good morning and thanks for having me on the show. i would say that the data in our mind paints a picture of a moderating but still resilient economy. it is worth reflecting that the u.s. economy added a million jobs in the first quarter. that hasn't happened since 1997. the preliminary surveys for april are showing that sentiment on main street is actually less downbeat than wall street. you saw the consumer sentiment

edge higher. we've seen business surveys stay resilient. i would say to my mind, what you are seeing in the economy is what the policymakers are anticipating. most notably, we've seen some improvement on the inflation front. inflation and -- is down from a peak of 5%. that's different to what you see in the u.k. where inflation is around 10%. encouragingly, we did see treat -- improvement in shelter. all of that does make the case for another fed rate hike. thereafter, there's also a case for the fed to begin to assess the impact of their tightening. overall, moderating but resilient economy is our take. bruce: the case is there -- tom: the cases there for another hike. there is a disconnect toward the end of the year. down to 4.4% by the end of the year. do those cuts get unwound?

>> in our mind, they do. we are position for that. rates will gradually drift higher. if you were to see the downside shock, you see room for a rally somewhat. this is an environment where the market on resilient economic data will price out cuts rather than pricing and more tightening. we are looking to take advantage of that. big picture, that room as to value when you see those growth movements embarrassed sentiment. it underscores the power of portfolios. if you add to higher yields that we have, there's a strong case for investors to restore allocations to fixed income assets. gurpreet: -- tom: do you have to brace for higher spreads or are we a long way from that? gurpreet: our view is that

investment-grade credit is one of those assets that's a high-quality asset. it's a high quality source of income. we don't expect a significant widening and spreads. we are monitoring what we see in earnings but we want say on the whole. investment grade companies tend to have more operational agility and financial flexibility. we think the starting point for fundamentals coming into this growth gap were solid. so we still see value in investment-grade credit as a high quality source of income. tom: still value in investment-grade credits. switching focus to the u.k.. surprise increase in terms of the cpi. 10.1% above the estimates. wage data holding strong. the markets pricing close to 5% on the terminal rate for the boe. is that appropriate? gurpreet: we think there is scope for another rate hike. that's because we received two notable hawkish data points this

week like you alluded to. the first was that sequential rage pressure. -- wage pressure. headline and core inflation was resilient. we think the bank of england is still in a somewhat risk management mindset. we are still in this data dependent era. that does support the case for another bank of england rate hike. data in the u.k. is very volatile in recent months. you've seen progress on inflation take one step forward and two steps back. we have to remain very humble and bumble in our outlook. i would say that we do think, once you start to get convincing evidence of disinflation in the u.k., you can see the bank of england change its tone quickly. there are signs that suggest inflation should start to ease in the coming months. commodity prices has ease. supply chain pressures are being resolved. on the labor market front, you seen companies indicate that

difficulties hiring are starting to ease as well. that could allow for labor market rebalancing, easing wage growth. tom: ok. really valuable insights. thank you for joining us this morning. the view that you will get another hike from the boe. if inflation turns lower, you could get a reactive boe on the other. coming up, tesla raises some of its prices after shares slumped on first quarter results. we discuss that and get the latest. this is bloomberg. ♪

tom: tesla has increase the prices of vehicles in the u.s..

it comes after the company's shares fell following earnings and results. that was a slump driven by recent cuts to its car prices. joining us now is danny lee. i'm trying to catch up here. what's going on? is this a u-turn? what's the issue with tesla? danny: elon musk would loathe to call it a u-turn. it is some fine tuning of pricing. after a slew of price cuts these last few months, this is a price rise. small price rise, two to 3% on some of these premium models on sedans and suvs. 2500 u.s. dollars increased across the board for those particular models on the model last and ask. this comes after what was a pretty poor set of earnings when you look at ms. profitability. investors did not like the pressure on margins and shares

fell on thursday 10%. that's the biggest fall in four months. this will also help ease the pressure on margins. tesla has been responding with price cuts in order to maintain its share. a slew of competition. elon musk and tesla did actually say that they would be open to price rises on top of price cuts. he is sticking to his word and keeping himself flexible. tom: the adjustments across the portfolio. this is a company we don't do enough on. don't spend enough time. see atl reporting better-than-expected first quarter results. they were a key supplier of badly -- batteries. what is driving its numbers? danny: the world's biggest maker of electric vehicle batteries.

they've been benefiting. they've been able to catch up and normalize their earnings. we've seen that growth of 80% in their revenue. that was a big beat to what analysts were expecting. profitability surged as well. margins were covered, up 6.6%. they are benefiting from rising car sales. also making sure they are keeping a check on cost. tom: danny lee joining us. thank you for the update there. the adjustments on pricing. let's check in on these markets. the standout moves coming through in the commodities markets, particularly iron ore. looking at losses close to 4%.

over 4%. part of the mix here is what's happening in terms of the demand softening out of china. this is the biggest drop in about six months on singapore futures. is the weakness in china ample supply? we are seeing that coming through from the likes of rio tinto. iron ore down 5%. softness and demand, high levels of supply, brought a recession risks around the u.s.. we keep across that story for you as well. brand looking at $81 per barrel. giving up the gains that it posted after that surprise opec-plus cut. coming up, the state of the european economy as we look at pmi's. this is bloomberg. ♪ to finally lose 80 pounds and keep it off with golo is amazing. i've been maintaining. the weight is gone and it's never coming back. with golo, i've not only kept off the weight but i'm happier, i'm healthier, and i have a new lease on life.

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tom: good morning. this is "bloomberg daybreak: europe". i'm tom mackenzie in london and these are the stories that set your agenda. president biden is preparing an executive order to limit u.s. business investment in key parts of china's economy. hawkish consensus. more fed policymkwea in favor of a rate hike. asia stocks follow wall street lower, but futures are mixed. elon musk's wealth plunges almost $13 billion in the tortuous 24 hours after tesla reports disappoint. twitter users lose their blue checkmarks and a historic spacex mission ends in a dramatic explosion. let's check on these markets. no explosions across equities markets. big focus around iron ore. we are weaving up -- weighing up

commentary from fed officials. if you are in doubt about a hike in may, those should be put to one side given the comments we got overnight from fed officials. the question is to what extent they hold rates at these levels, and whether they are gone in may. the expectation for markets is cuts back down to 4.4% by the end of this year, that remains a debate. across the msci asia pacific, you are seeing losses of .6%, as scrutiny remains on the health of the global economy, u.s. futures flat after the losses yesterday. futures in the euro area gaining a little over .1%. tesla the corporate story of the moment, given the updates around pricing. 49.7 percent to hit to elon musk in his wealth, but some of the premium models will see price increases, with context but the likes of the model 3 are being cut in terms of prices 20% just year today. let's see how things are playing

out across other asset classes. zeroing in on iron ore, in terms of the gauge of that recession risk fear, and the health of the chinese economy, the demand impulse isn't there for iron ore. and you are seeing losses of 5% again, a buildup of production coming through from the likes of rio tinto, but the biggest drop in six months on singaporean futures. oil also under pressure, back below $81 a barrel, and pairing all of the gains after that surprise opec+ cut. 4.12 at the front end of the two-year. we get pmi out of the year is on this morning. last month's data shows manufacturing output broadly stagnated. for more we are joined by our economics editor in berlin. what are today's numbers likely

to show in terms of the health of the eurozone? >> good morning. that trend you outlined, services growing, and manufacturing stalling or may be shrinking, is one economists predict we will see again in the data today. we get france and germany, the two top euro area economies, then euro area pmi's themselves. overall, services in the last month, certainly in march, were so strong that they covered any weakness we saw in manufacturing. economists predict that trend will continue for the april data. manus: what does this mean for the european central bank? >> last -- back in march, when the ecb presented its rate path, they didn't outline what the rate path would be.

instead, philip lane, the chief economist, said here are all the data points we will be looking at, and pmi's play an important role in that. with the ecb, they don't care as much about growth, their mandate is about inflation. so the ecb is likely to look at what input prices are doing, and what purchase managers are saying about overall prices, and what does this mean? will inflation, at the moment more than three times the ecb's goal, what will these pmi data show is about what inflation will be doing longer-term? does it mean in two weeks, the ecb will raise by 25 or 50 basic s points. tom: thank you for a preview of that data, and the potential implications for the ecb. let's get the first word news with adrian wong.

adrian: bloomberg learned, u.s. president joe biden will sign an executive order that would limit investment in key parts of china's economy by american business. the administration has been debating the measures for almost two years. g7 partners of the u.s. have been briefed even though they are not expect it to announce similar restrictions. u.k. prime minister rishi sunak is weighing the fate of his top deputy after receiving the findings of a investigation into bullying allegations against dominic raab. the case against the deputy prime minister is not clear-cut. he maintains he has not acted improperly. some of ukraine's allies, including the u.s., are waiting an outright ban on most exports to russia. g7 officials are discussing the idea ahead of a summit in japan next month. if agreed, it would be a significant tightening of restrictions with all exports to

moscow banned. canada is investigating a heist at the country's biggest airport. it contained over $15 million worth of values taken from a cargo holding area at pearson international. gold mined in canada travels to the hub on his way to customers around the world. global news powered by more than 2700 journalists and analysts in more than 120 countries. tom: european lawmakers now, this is really interesting in the crypto space. they have approved an ambitious law that will give the eu its first rules to govern the crypto industry. a rules package for the crypto industry in the eu taking a first move on this. for more, let's bring in bloomberg's eu reporter in brussels. what is the importance of this legislation?

it seems really significant for the crypto space. >> indeed, not just a seems, but it is really significant, because we are getting the first-ever comprehensive rules. the first-ever comprehensive regulation that will govern the pretty much unregulated crypto space. this is going to go a long way. this is setting boundaries for the crypto market. this is bringing them under the supervision of european authorities. and, this is something that perhaps other jurisdictions will be looking towards when they implement something similar for themselves. tom: that is interesting, whether it will be a template for other jurisdictions.

do we have any sense what it means for the crypto industry? >> what it means for the crypto industry, first of all, companies that won't operate in the european union will have to register in one of the 27 member states to be able to do that. that is the most important thing. but also, it introduces adequate risk management and corporate government practices. for example, issues of stablecoins will have to backup their value with significant reserves. there is the so-called travel rule, when participants in the market will have to provide information on senders and receivers to local anti-money laundering authorities. this is not the end.

it is a big start, and more things will need to be introduced in terms of control and regulation. tom: bloomberg's lyubov pronina on regulations for the crypto industry out of brussels. coming up a week of contrasting fortunes for the big wall street banks. we will take a closer look at earnings and get a preview of european bank earnings coming up next week. the health of the global banking sector. this is bloomberg. ♪

>> there is a real opportunity where we are in discussions with a number of regional banks to partner with them. they have valuable relationships with borrowers across the country. we have long-term capital, and

so in consumer financing and small business financing, we think there is a real opportunity to deploy more capital. it is one of the real strengths of the alternatives business. this used to just be about real estate private equity, but what we do today is much broader. i think the private credit area is at a golden moment, because we see tightening out there, and yet, we have this large pool of capital to deploy. so you will see has become more active. >> i'm curious about your thoughts on inflation. you have had a number of rivals saying the market is not prepared for the eventuality of higher rates. you have said that cuts this year are also not on the horizon. what is the thing the market is not seeing about the direction of travel? >> i would say on the inflation

front, i will give you a little bit of optimism. we see inflation moving into the rearview mirror. i say that because across our portfolio, the statistics are really encouraging. our procurement managers and portfolio companies are saying inflation in terms of input costs was only up to percent in the quarter. shipping costs have almost come back to 2019 levels. even wages, which were up as high as 7% in our portfolio six month ago are now at 5.6%. and the availability of workers has gotten a lot better for our portfolio companies. if you look at the cpi number, last month it was 5%, but if you exclude shelter which is a lagging indicator, it was up just 3.4%. that is the good news. the more challenging use to your question on rates, is the federal want to make sure inflation really gets down.

the idea that they will pick it a mistake. they are much more likely to pause, hold rates at an elevated level, and continue to see the economy decelerate. when you add in what we have been talking about with regional banks, that will create further tightening. tom: that was blackstone president and coo jon gray speaking to bloomberg about inflation concerns and the private credit market. worth reminding viewers that blackstone did default on some mortgage-backed bonds in march, about half a billion euros. blackrock vice-chairman has praised the swiss government for the way it handled the collapse of credit suisse. he spoke at the bloomberg new economy europe forum in ireland. >> given where the authorities were at that point, it seems

that the government in particular has done a very good job. not just for switzerland itself, but also for their global financial system. the question now will be how does this settle? and how his ubs position itself going forward, given the quite intense political discussions in switzerland around competition, size, and many other issues. tom: bank of america chief executive brian moynihan has weighed in on recent industry turmoil while speaking at bloomberg's sell side leaders forum in new york. he said banks are in good shape, and the disruption did not rise to the level of crisis. >> at the end of the day, crisis is too strong a word. words like that it used a lot. but there was a fair amount of disruption for a few weeks, certain business models were through. but on the other hand you see stability in other business

models. tom: banks have increased emergency borrowings from the fed for the first time in five weeks, indicating financial stresses are lingering after a string of bank collapses last month. it comes during a week many u.s. banks reported earnings for the first time since the turmoil. for more, let's bring in bloomberg's european finance reporter out of frankfurt. nick, you have been weighing up these earnings out of the u.s., the big ones, but also the regionals for the first time in focus. what do they tell us about the lasting effects of rising interest rates on the sector? >> especially the big banks in the u.s. have really profited in the quarter. both on the net interest income and lending front they have been earning dramatically more. the rise in rates has helped them in terms of trading revenue, part of the rates trade

business was a key area of strength. other parts of trading didn't do so well. credit-rating was more mixed at various banks. same thing with foreign exchange, equities had a tough time as did investment banking and the advisory front. the big banks have profited from deposits being brought from smaller regional banks, a flight to quality. the question is how sticky are those funds going to be, will depositors move onto the next bank after that, or are they there to stay? tom: the resilience of those deposits will continue to be in focus. switching focus to the european banking space, earnings coming out next week. what will investors be focused on within those numbers? >> credit suisse kicks off the week. they are always a big focus for

investors. then ubs on the wealth management franchise, how much has been eroded, how much can they hang on to, what will the progress be in terms of unwinding unwanted assets? more broadly, we are slower than the u.s. in terms of hiking rates, so where will we be in that cycle of the benefit for the big banks? how much will net interest income accelerate? what is the benefit for the trading business, willow bay -- willow bay benefit -- will they benefit from interest rates. and how our borrowers coping with high rates? will we see the first signs of higher loan loss provisions? borrowers saying we can't afford those payments anymore. tom: the importance of that asset quality within this

environment. bloomberg's european finance reporter nicholas comfort with a rate set up in terms of what to watch for, in terms of european bank earnings that kickoff of credit suisse on monday. u.k. household confidence jumps to the highest level since the start of the war in ukraine. what is going on, we will unpack the details. this is bloomberg. ♪

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tom: welcome back. u.k. household confidence has hit its highest level since the start of the war in ukraine. gfk's consumer confidence index rose to a 14-month high. joining us is jamie rush from

bloomberg economics. what is going on? is this going to be sustained? why is there consumer confidence amid high inflation and lower real wages? >> part of the answer is we are reaching the end of the season in the u.k. the cost of energy is a concern, and now they have more control over what their outlook will be. that matters to some extent. we should remember that although consumer confidence is improving, stabilization is still below the depth of what we saw before the pandemic. there is a long way to go before we are comfortable with what is going on. tom: still a bit of catch-up, but softening in energy prices helping. what are you expecting from pmi later today?

>> one of the interesting things is that businesses and households have not agreed at all what it looks like. households have been much more upbeat. we are not inspecting the same improvement in pmi as we have seen in consumer confidence indicators. tom: presumably when we tie in consumer confidence with the wage growth, the increase in cpi, it underscores the need for the boe to go with another hike. >> it is a case of good news is bad news at the moment. the tighter the labor market is, the more the bank of england has to do. the higher rates go, the bigger the risk something goes wrong. we have seen strong inflation data recently. and wage growth continue to exceed expectations. for the bank of england, hiking looks inevitable in may and into the summer. tom: jamie rush, thank you for

the context and analysis over the improving outlook of this picture across consumer confidence, but as he said, good news is bad news when it comes to expectations of further hikes from the bank of england. carlyle eying new mcdonald's china backers at a eight to $10 billion value, there is a group considering bringing in fresh backers for investment in mcdonald's corp.'s chinese operations. it is run is a franchise operation, separately to the overall u.s. business, but of course, they have many hundreds of outlets across china. so carlyle eying new backers at a valuation of eight to 10 believing dollars. let's check in on markets. the focus very much on iron ore. the biggest drops in six months on singaporean futures for the commodity.

coming down 5%, on waning demand out of china, a number of big steel manufacturers where they produce the stuff have close down for maintenance. but also supply example. shrinking demand out of china, and broader recession risks as well. oil currently at $80 a barrel, close to $81, down .2% today. importantly, giving up pretty much all of the gains that came through from that shock opec+ cut, where they prescient or are they now licking their wounds and thinking of another cut to support these prices? in terms of futures, you are looking at modest gains, about .1% for european futures. u.s. futures are currently flat. the msci asia-pacific is currently down .6%. the bulk of the selling has come through for tech stocks listed in hong kong. the hstech index currently down 2%, i have to wonder whether that is partly down to what is

happening in terms of president biden's decision. the executive order to limit u.s. investment in what they say our national-security-linked businesses in china. maybe rethinking of the narrative around china tech, as well. in terms of currencies, the standout is began to, gaining .3%, inflation taking higher-than-expected, a big question for the boj next week, is japan seeing the outlines of an inflation problem? still ahead on bloomberg tv, we speak to the bank of italy head, that interview is exclusive the next hour. we will talk to sap's cfo as we dig into the company's latest results. this is bloomberg. ♪