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good morning. this is bloomberg daybreak europe. i'm lizzie burden in london. and these are the stories that set your agenda. surprise cut. china's central bank unexpectedly cuts its key lending rate by the most since 2020, as industrial production, retail sales and fixed assets data all miss estimates. asia markets are mixed. donald trump is indicted in atlanta over alleged efforts to undo his 2020 election defeat in georgia, adding a fourth criminal case against the former president. plus, what warren buffett is buying and selling. we'll bring you the latest 13 f filings as hedge funds look to gain from the hype over artificial intelligence. well, good morning. welcome to tuesday. and it might be august, but it's a busy one. you've got traders betting that the fed is going to keep rates higher for longer. so treasury yields have been steadying in early trading in asia. but you did see the ten year yield climb to its highest since

november yesterday. the two year yield, which of course is more positive, sensitive of advanced for a fourth day yesterday towards 5%. and the real ten year yield is was at a 14 year high. now that spurred gains on the dollar against some of its major peers and emerging market currencies. it's an ugly day for them and the pain is everywhere, especially though for the argentine peso, which is also devalued its currency by 18% and hiked rates by 20 pips. now the question is, will the pain persist? we should get more clues on the future path of fed rates in the minutes of the fomc s latest meeting when they're published later this week. and if you look at the two day chart on us stocks, tech had its best day in two weeks yesterday as traders weighed the prospect of a soft landing in the us. us futures now pointing to a higher opening. meanwhile, out of china, we've had a horrible data dump which both explains and somewhat cancels out the surprise rate cut in terms of supporting

stocks, but doubles pressure on the yuan. and we're going to unpack that now with a special china edition of our morning roundtable. well, i'm joined by tanya chen and jill diocese in hong kong. and as always, here with me in london, have valerie title. so tanya, china's central bank's unexpected cut interest rates as it ramps up stimulus to support the weakened economy. you saw disappointing july data industrial production and retail sales missing estimates. how are asian markets faring in response as hey, lizzy. yeah, let me unpack that for you. so let's start with the equities markets, hong kong shares and mainland shares just came back from their lunch break and yes, they are obviously down in the red. their declines of over 1%. investors are obviously looking for more out of the pboc. without going too much into what jill is going to say, i mean, this 15 basis point rate cut on the medium term lending facility rate was the largest one since 2020. and then we obviously got that raft of disappointing data, as you were saying, retail sales and industrial production

disappoint there. but there's also all of these concerns around the property sector woes. the country guard and missing payments. these also these concerns around youth unemployment. i mean, they're also looking to stop releasing these figures. these figures used to come in around 21% earlier in the year. so if you see in the in the equities market, obviously there's a lot of declines there. but also you're seeing a lot of these declines in the forex market, a lot of volatility. the onshore yuan is now around 7.2, sorry, heading towards that 7.3 handle. but the point is that these the currency is very much on the back foot. it was already weakening overnight with the dollar and the yields that were pushing that currency down. the pboc will continue to fix this currency to try to shore up to shore up the currency. but the we're also hearing that state banks are dumping some of these dollars to try to help with the currency moves today. but there is one bright spot in chinese assets, which are china bonds. so today, china bonds are obviously rallying here on this cut. we saw yields headed down to the

lowest since 2020. we've seen these expectations getting baked in already in the long end of the yields. but we'll obviously see if there's more room for this rally to run. all right. thanks to tanya chen. and we're going to check in with you, tanya, later in the morning again. but i want to bring in jill disis now. jill, tanya, set the stage for you. just unpack this rate cut for us from the pboc. well, look, lizzie, i think tanya is totally right. this isn't just about this really terrible data that we saw today, which, of course, showed economic activity across a multitude of factors, from industrial production to retail sales slowing in july. this is also about fears of broader contagion risks in the property sector, but potentially other sectors. i mean, we've talked about country garden. we've also seen some concerns about whether that's spilling over into this, you know, $3 trillion trust industry in china. i think that there's a lot that kind of comes in with financial risk here that the pboc is probably looking at in making this decision. the question, though, is how effective is a 15 basis point policy rate cut actually going to be?

right. i think that at this point, you know, that's probably signals that maybe we'll see banks adjust their benchmark lending rates a little bit later this month. but ultimately, we've been talking to economists all morning and they're saying, look, if this is a fairly limited move here, a lot of china's problems are really more structural in nature. and so you're going to have to see more measures actually being taken to help the economy. maybe that does mean more rate cuts by the pboc further into this year. next, you know, maybe that means some additional, you know, measures to adjust other problems within the economy. maybe that means revisiting some property easing measures that i think investors have really been clamoring for recently. but ultimately, it does seem like, you know, whatever comes of this rate cut today, it's probably going to be fairly limited in in effect right now. so, valerie, what about the us impact? we had the treasury secretary, janet yellen, saying that china's economic woes are merely a risk factor for the us stock. quite the ticking time bomb that joe biden was warning about. yeah, yellen's language on china yesterday didn't exactly match

biden's a few days ago, but she did claim that it was a risk factor for the us. but then again, she said that she's still optimistic about us economic growth and china's slowdown. the biggest impact will be on its asian neighbors. it will have some impact on the us, some spillovers, but it doesn't significantly dent her optimism. and if you look at the equity markets here, lizzie, i think they share a bit of yellen's view risk really has not been on the back foot today since these really weak data out of china. i find that very surprising. there's a lot of reasons why you could see risk being on the back foot today and, you know, we are continuing to see these equity futures gained after tech had its best day in two weeks yesterday. yeah, interesting also that yellen was commenting on the ruble given russia's emergency rate meeting and the broader ugliness we were just talking about for currencies today. wow. yeah, it's just again, a bit shocking to me. and i think to many market

participants that risk isn't being rattled by this. we've had be really shaken up. the argentine peso falling by 20%. the ruble continuing to weaken and then dollar hitting a fresh high, breaking 730. you also had the us real yield story, a ten year real yield surging to a ten year high. and then the japan gdp overnight. not only showing a massive beat when it comes to that headline gdp, but the deflator coming in very strong. these are not normal situations where you see equity markets in the green, where you see risk outperform and look, we got the nasdaq up another 3/10 of a percent this morning after having a very strong session yesterday, up over 1%, maybe a lot of people raising an eyebrow to win this risk rally will be dented in the us. but look, it is summer markets. it is low volumes. maybe this is just how august trades. all right. let's take a look at what else is coming up today at 7 a.m.

london time, we get the latest uk jobs data. at 10 a.m. we get the germany survey. so that's going to show where the sentiment is continued to be weighed down there this month by higher financing costs and of course, weaker foreign demand as well. and then at 1:30 p.m., we get us retail sales data on balance, economists reckoning they rose naught point 4% in july because they probably got a boost from amazon prime day. but then again, there has been more use of buy now pay later services. it suggests consumers are feeling the pinch of higher inflation. but i just want to come back to the bank of england. they're clearly going to be watching out for this uk labor market data and really eyeing it closely. how much do you reckon that another hot wage print would lift traders bets for the peak of uk rates? currently 5.75%? yeah. lizzie, i think that, you know, we just have to look at friday's example of how gilt traded after that strong uk gdp print. i mean, they fell out of bed yields were higher by 15 basis

points after that session. i think that underlines the risk that that that's going on with the with the bank of england right now. they got dovish too quickly and the market is really going to start to push them again, thinking that they're definitely not done with this rate. hiking cycle and edge up that terminal rate ever higher. all right. thanks to bloomberg's valerie title and jill disis for our morning roundtable. and you can get a roundup of the stories that you need to know to get your day going. in today's edition of daybreak, they lead today on china rate cuts. the emergency meeting of the bank of russia and they also have the so-called tiger cubs trimming their holdings in tech stocks, bucking the trend of other big money managers who've loaded up on tech. now, terminal subscribers can find all that and more by going to deib. go. coming up, former president donald trump is indicted in atlanta over his efforts to undo his defeat in the 2020 election in georgia. we get all the details live from washington, next. this is bloomberg.

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hard. early detection gave us time to adapt together. if you or your family are noticing changes, it could be alzheimer's. talk about seeing a doctor together. welcome back to bloomberg daybreak. europe now. donald trump has been indicted in atlanta over alleged efforts to undo his 2020 election defeat in georgia. it adds another criminal case against the former us president as he campaigns to retake the white house. trump's lawyers called the indictment flawed and unconstitutional. for analysis, let's bring in our us government editor john harney, who joins us from washington, dc. john, how does this indictment differ from the others? well, it's what's remarkable is, is it's a sweep and breadth, unlike the others. it also ensnares promise meant

prominent members of trump's white house administration mission, as well as associates. like most notably rudolph giuliani, himself a former prosecutor and mayor of new york who was hailed as a hero after the 2000 2001 terrorist attacks. it's also notable for its ambition. it attempts to portray the attempt after the 2020 election to undo change the results as part of a vast, just a vast undertaking, a conspiracy, a criminal and a criminal conspiracy that extended not out beyond georgia into other states over a period of several months. yeah, interesting to see that the penalty could range from 5 to 20 years in prison. how soon will the trial begin, john? well, district attorney fani

willis spoke to reporters briefly after the indictment was unsealed and said she wants a trial in six months. and and that she wants all 19 defendants to be tried together. that the second part of that seems pretty unlikely as well as the first part mean six months will be heading. that will be heading into an election. it will be a in an election season. and president and former president trump will certainly try to get it delayed. and it'll also run into trial dates for these other these these three other cases in new york and and and the two brought by jack smith, the special special counsel. and you've got your finger on the pulse of the whispers in the corridors there in washington. what's been the reaction in these first few hours? well, it's it's it's somewhat predictable, leader.

you know, congressional republican congressional leaders have already within really a shortly after these indictments were these these expected this expected indictments announced have said it's a conspiracy, it's persecution. it's trying to influence the 2024 election. other advocates, you know, democrats, of course, have said this is all more evidence that trump not only should not be president again, but that he should face justice. all right. bloomberg's us government editor john harney in washington. thanks for being with me this morning. now want to get an update on some of the other big stories we're watching globally today. ubs has agreed to pay $1.44 billion to settle a case with the us department of justice regarding its handling of residential mortgage backed securities in 2006 and 2007.

the doj case accused the swiss bank of selling billions of dollars of the securities by, quote, knowingly and repeatedly making false and fraudulent claims about them. ubs argued there was no fraudulent intent by any employees. and as mark has offered to buy us steel for $7.8 billion in cash trumping an earlier bid from cleveland-cliffs. the announcement by the privately held esmark has surprised many market watchers, and it raises the stakes in the battle for the future of the american industrial icon. us steel shares spiked on the new bid to close 37% higher. the biggest one day increase on record. and now it's a big week in terms of us retailers reporting earnings. we await results from home depot today, followed by walmart and target later in the week. there have been discussions behind the scenes here at bloomberg tv about what it says about you, which one of those you favor. controversial discussions.

in fact, it's not something i know much about as a brit, but that's a conversation for another time. these results, though, out pre-market. they're going to give us more insight into consumer sentiment as us inflation eases further. our analysts here at bloomberg intelligence reckon that home depot is going to face another second straight quarter of slumping sales. they expect both spending by professional customers who account for about 45% of total revenue and diy customers to weaken. and those shares are up 4.8% year to date. so we keep an eye on those earnings later today. coming up, more on china's disappointing july data, industrial output and retail sales both missing estimates. we dissect the numbers next. this is bloomberg. there's nothing nothing on the market comes close. and i've been doing rusty parts for over 50 years. consisted it has outperformed everything we've ever used or

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europe now. south africa's brics ambassador says the group is not competing with any other bloc and is trying to work collectively to promote the interests of the developing world. anil sooklal told us that members will discuss a common currency next week at a leaders summit at in the public domain in a number of of writers have been characterizing brics as being anti west as a coalition against the g7 and it's unfortunate. it's unfortunate because brics has never been created as a bloc against any other entity. it's not in competition with any other existing multilateral forum and brics came together to to look how we can work collectively in terms of the shared values we have in reshaping the current global architecture, taking the interests of the global south

and projecting them as part of creating a more inclusive represent tentative and fair, multipolar world. anil sooklal, south africa's ambassador to the brics. there. now china's central bank has unexpectedly cut interest rates as it ramps up stimulus to support the weakening economy. that's after a slew of weak data for july. and for more, we're joined by bloomberg's mark cranfield and on our live team, mark, there's been plenty of action with china's yuan. what's going on there? yeah, just when traders had given up on the idea that china was going to lower any interest rates, they've been been betting on it for for quite a while. and the week when they all go quiet on it, suddenly china surprises everybody and does, by their standards, quite a decent sized cut in the minimum lending facility. the one year rate was dropped by 15 basis points, which was came as a complete surprise because the majority of economists thought there'd be no change again today. and then they followed it by lowering the seven day repo rate

as well. so pretty significant. and that lit a fire under dollar yuan that leapt higher. highest it's been all this year going back into last year as well. and that's triggered across moves across several other asian currencies as well. but it hasn't done a great deal for the equity market. as you say, the data was still pretty poor. most disturbing is the property investment numbers. they were very weak. there was lots of china data today and if you look through it, there was nothing really very encouraging. but property stands out as being a particularly weak sector, as we know. there's a there's a lot of issues in that market as well. so all in all, china, equities, nothing really to impress them there. so it looks as though the government will need to do a lot more yet to convince people that the conditions are really turning positively in china. this rate cut hasn't been enough. meanwhile, we've also had second quarter japanese japan gdp, so a big beat there, more than twice the estimates. what's been the yen impact? has it had too much impact on

the on the currency? and i think that's partly because it was mostly driven by exports. the domestic side of the gdp numbers was really not that exciting. so there's nothing too much to persuade the japanese authorities that they need to to tighten interest rates at all. there. it's it's all being driven by the existing weakness in the currency. so really, the bank of japan has got no incentive for the time being to dispense with the negative rate policy. and that's really what the yen was waiting for. it was waiting for changes in that direction. and this data doesn't give them the foothold to be able to move to a tighter policy. so all in all, it's been a bit of a damp squib really. and finally, it's an ugly day for currencies. the pain seems to be everywhere but the ruble and the argentine peso, really the most high profile victims. but it's not just about us yields, is it? will this pain persist? mark? well, china certainly doesn't help the equation at all when you've got a major player in the

emerging market world moving its currency lower, that really hurts everybody. so from here, it looks like it's every man for himself. and if china until china is ready to really stabilize its yuan, it's not going to help anybody in the emerging market world. so really, it's a bit of a free for all. and the kind of weakness you're seeing isn't going to change in a hurry. and as you say, higher us yields are just making the whole situation worse for everybody. all right. thanks to bloomberg's mark cranfield for that analysis. now let's just check in on how markets are faring elsewhere. you've got euro stoxx, 50 futures currently up 5/10 of a percent. meanwhile, s&p e-minis up 2/10 of a percent and nasdaq futures up 3/10 of a percent. this is after the nasdaq rose 1.2% yesterday, driven by nvidia and other tech giants. but really, as mark and valerie title were saying earlier, you haven't really seen a rattling that you perhaps might have expected, perhaps that's down to low volumes here in the summer season.

then again, as we look ahead at 7 a.m. uk time, we're going to get the latest uk jobs numbers. there. obviously crucial for the bank of england as a measure of how much inflation is being domestically generated in the uk and thus how persistent it is. we've talked about markets betting that the fed is going to keep rates higher for longer. the impact on treasuries here in the uk, neither markets nor most economists expect that the bank of england is done with hiking. yet given that pay growth is still well above what's consistent with the bank of england's 2% inflation target, even if if you've seen headline cpi showing further signs of easing. so our economists expect that the unemployment rate will hold steady in the quarter to june at 4%. same forecast as the bank of england, but perhaps more important for the boe is going to be the wage data. our economists here at bloomberg economics reckon that that's going to tick up from 7.3% to 7.5% in the latest reading for june.

those numbers coming in at the top of the hour. we're also going to bring you more analysis from jamie rush, our chief european economist here at bloomberg economics later in the program. but coming up, more on china's disappointing data. and we have industrial output and retail sales both missing estimates in july. that's coming up next. this is bloomberg.

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good morning. this is bloomberg daybreak europe. i'm lizzie burden in london. and these are the stories that you're waking up to. china's central bank unexpectedly cuts its key lending rate by the most since 2020. as industrial production, retail sales and fixed assets data all missed estimates. asia markets are mixed. donald trump is indicted in atlanta over alleged efforts to undo his 2020 election defeat in georgia, adding a fourth criminal case against the former president. plus, what warren buffett is buying. we'll bring you the latest 13 f filings as hedge funds look to gain from the hype over artificial intelligence. well, good morning. welcome to tuesday. and it's actually a busy one despite it being august. you've got traders betting that the fed is going to keep rates higher for longer. and if you look at the impact on yield as well, they have been steadying. but you had seen the ten year yield climb to its highest since november and the two year yield, which of course is more

sensitive to monetary policy, advanced for a fourth day yesterday towards 5%. ten year real yields were at a 14 year high. now, that spurred gains on the dollar against some of its major peers, but also against emerging market currencies. it really has been an ugly day for them and the pain seems to be everywhere, especially for the argentine peso, which has also devalued its currency by 18% and hiked rates by 20 pips. now the question is how will the pain persist? we should get more clues on the future path for fed rates. in the minutes of the fomc latest meeting when they're published later this week. if you look at the two day chart on us stocks, tech had its best day in two weeks yesterday as traders weighed the prospect of a soft landing for the us economy. us futures now pointing to a higher open ing. and meanwhile out of china this morning we've had a horrible data dump which both explains and somewhat cancels out the surprise rate cut in terms of supporting stocks. but doubles pressure on the

yuan. so let's get more on the asia market. reaction now with bloomberg's tanya chen. she's in hong kong. tanya is there any good news? amid all this doom and gloom? hey, good morning, lizzy. yeah, so as you can see right there on the board, just now that you were showing, chinese equities are obviously wanting to a little bit more out of the pboc as you mentioned, the pboc unexpectedly cut their benchmark medium term lending facility rate today by 15 basis points. that's the biggest move since 2020. we're also looking to see if they will make those similar cuts in their loan prime rate in the days following. but investors are obviously looking for ways for them to shore up confidence again in the market. we're seeing a lot of concerns around the property sector. we're also seeing that data come out shortly after that surprise rate cut. retail sales, industrial production all expanded, but missing estimates. we're also hearing that they're going to stop releasing this youth unemployment data, this benchmark that they've been following for quite some time to show kind of sustainable growth.

that figure was around 21% earlier in the year. and so how markets are faring, i mean, as you mentioned, the yuan has already slipped past the 7.3 handle level overnight. the us treasury yields and the us dollar are obviously putting quite a little bit of pressure on the currency. state banks have been observed seeing selling the dollar today to help shore up the weakness in that currency. but if you look on the flip side with chinese bonds, they were rallying today. they fell initially yields initially fell by five basis points on the ten year note. and as you had heard, expectations for easing had been kind of baked into that longer end of the yield. we saw those yields near multi decade lows earlier this month. and meanwhile, we've had a big beat when it comes to second quarter japanese gdp, but not a lot of reaction for the end. just a brief update on that, if you would, tanya. yeah, and you're also seeing lines cross now from bank of japan officials and this verbal intervention of sorts is pretty much unexpected. i would say at this point.

we're probably going to hear a bit more given how much yields and the dollar have really been putting pressure on both of these currencies. but yes, as you say, bank of japan, obviously the big part of this tweak that happened around regarding the reference guidelines around the jgb ten year note was had to do a lot with this currency volatility. and we're seeing the currency still weakening. so we'll have to see if there's going to be more verbal intervention in the days following. all right. thanks to bloomberg's tanya chen for that update on asia markets. and i want to stay in asia now because taiwan's vice president is seeking to reassure voters that he's a steady pair of hands as he campaigns to become the island's next leader. he spoke exclusively to bloomberg businessweek in his first interview with international media since becoming vp and told us about his plans for relations with mainland china. take a listen. well, when you saw also we, the us, we must abide by the truth, which is what i mean by

pragmatism. it is that taiwan is already a sovereign, independent country called the republic of china. it's not part of the people's republic of china. the roc and prc are not subordinate to one another. it is not necessary to declare independence. what is your roadmap to formal independence? you may well. chenzhuang my responsibility is to maintain the status quo in the taiwan strait while protecting taiwan and maintaining democracy, peace and prosperity. so no such framework exists. we must work to maintain the peaceful status quo because taiwan is already a sovereign country and china keeps pushing on the status quo and it keeps pushing its fired a missile over taiwan. it's crossed the median line in the taiwan strait and it's simulated a naval blockade. what is your red line on the

increased tensions impacting the status quo in the taiwan strait have not originated from taiwan. they are due to china's growing assertiveness. china not only seeks to annex taiwan, it also hopes to change the international rules based order. under these circumstances, we must be clear taiwan's security is of international concern. peace and stability in the taiwan strait is aligned with the international interest. so we because challenges in the taiwan strait are a global concern, a global red line will also be taiwan's red line. and my personal red line. you've said provocative things in the past that will be of interest in washington. how have you changed. taiwan? i have been part of president tsai's national security team, together with the us government, we have responsible and clear channels of communication. we are able to share information

effectively, understand where the issues are and cooperate in resolving them. this election is about choosing between two roads. one way is to continue engaging and cooperating closely with the international community while deepening our democracy. the other choice is to accept the one-china principle and stand together with china. i believe the us will continue to support us on the first path. so how confident are you that the us will have taiwan's back? should the situation with china escalate, make war? sir taiwan how the us is a close friend of taiwan. we are partners in a number of areas from politics, the economy, human rights to our society. with taiwan. the and because taiwan's security challenges are a global concern in the upkeep of peace and stability in both the taiwan strait and the indo-pacific

region, fulfills the common interests of the international community. i believe that all democracies in the world, including the us, would be aware of how to respond if such a scenario were to take place. what do you want the world to know about you as a person? was the design. i am a rational and steady leader. i know how we can respond to the challenges we face as a country. i also understand that the serious and complex nature of issues in the taiwan strait call for rational and steady leadership. this will enable our country to move forward amid changing geopolitical circumstances. so that was the taiwanese vice president speaking exclusively to bloomberg businessweek's joel weber. let's stay in the region and get more on the china data. it is our top story this morning with bloomberg's eric zhou. eric, what is your take on this data and the pboc rate cut. clearly, it's not a good start

for second half of the year. so we see a broad slowdown in all of the major activity indicators and it's one, two messages. one is clearly the continuing slump in the housing market is continuing to drag on the growth and also low confidence is also, you know, now nullifying some of the policy announcements which have been done earlier. so that's clearly means the government, the pboc needs to do more following today's interest rate cut to further support the growth. and you've seen country garden recovering somewhat today after a very difficult day yesterday. but from today's numbers, what do you see as the risks if the housing crisis deepens further? yeah, i think it's far from over. the housing crisis. so the data published today hasn't seen any, you know, promising signs of quicker turnaround in terms of major activity indicators, including

sales, property investment. so we think the crisis will drag on unless the government, you know, push forward with more forceful and quicker stabilization measures, including, you know, some relaxation, more relaxation in those top tier cities in order to stabilize the market. otherwise, we will see more stress in the credit market to continue. yeah. all right. thanks to bloomberg's eric zhou for that update. now let's take a look at some of the other things that markets are watching out for today. in a short while, at 7 a.m. uk time, we'll get the latest uk jobs data as investors look for clues on the bank of england's next move. bloomberg economics forecast that the regular annual wage growth for the whole economy will rise to 7.5% from 7.3%, and the unemployment rate is expected to tick up just slightly. then german survey results are going to be coming out at 10 a.m. london time. that'll be the first major survey to be released in the euro area for august. and at 1:30 p.m. london time,

we'll get us retail sales data and the latest reading on canadian inflation for july. finally, before the bell stateside, we'll also have earnings from home depot coming up, what buffett's buying. we'll bring you the latest details of the 13 filings for the second quarter as hedge funds look to gain from the hype over artificial intelligence. that's next. this is bloomberg. this is marianne's first time visiting paris. well, you, um. before marianne packed her bags, before she attempted her first sentence in french, she downloaded babble. so when it came time to tell the cab driver to take her to the hotel pierre shimmer, ali l'hotel. pierre babble focuses on natural conversation. you can speak and pronounce with

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calm, download the free app now telling the girls about my alzheimer's diagnosis was really hard. early detection gave us time to adapt together. if you or your family are noticing changes, itd be alzheimer's. talk about seeing a doctor together. welcome back to bloomberg daybreak. europe now. hedge funds bought into some of the biggest tech names in the second quarter to capture the sector's sizzling rally. and hype over artificial intelligence. that's according to their 13 f filings with the us security and exchange commission. the sec.

and joining me now to break it all down is bloomberg's valerie title. val, what do we learn? well, these hedge funds are still chasing the us tech trade in a big way. technology accounted for the biggest weighting in these hedge fund portfolios, followed secondly by health care. that's that really popular weight loss drug trade in the hedge fund space. but back to technology, meta salt, the biggest increase in market value for a single stock followed closely by microsoft, apple, nvidia, all popular buys. one tech stock that was reduced was intel. it's seen as not necessarily having those capabilities when it comes to its chip making technology, but it's very interesting to see that these hedge funds, again, chasing this rally, chasing this us tech rally, remember, we get these 13 filings. they are slightly delayed and it just snaps what they were holding at the end of the second quarter. but it's very clear they are very much trying to ride this

tech rally further. so that's us tech. but we've also seen a big switcheroo from the closely watched michael burry when it comes to china tech. we've talked all morning about china and the economy there. what do we read into this move from? yes. so in michael burry's scion fund, one thing scion is all right. he exited his china positions and that was something he had doubled down on in the first quarter, really doubled down on his positions. alibaba, jd.com, but he has now completely exited them. it's interesting to see this happen. you know, with this backdrop of the macro deteriorating for china, maybe not surprising he cut that position, but for some of the other single names that we heard from, one of them being rokos, one of the largest macro funds out there, lizzy, they run almost 15 billion in assets under management. they bought over 2 billion of qq etf, which is the etf that tracks the nasdaq 100. so still going big on tech.

they're also put a new stake in tsmc and bought some upside positions in alibaba when it comes to roku. so again, another big flashy hedge fund name chasing that tech trade. we also saw some interesting things from berkshire hathaway, the fund run by warren buffett slashed its stake in activision blizzard. that's as ongoing anti-trust scrutiny. we know that the activision microsoft deal is still under scrutiny by the cma here in the uk. he did add some new positions when it comes to home builders in the us. d.r. horton being one of them. they saw a big beat in their second quarter earnings. so i'm sure warren buffett is happy with that. but again, very interesting to see what these hedge funds are up to. even if it is a bit delayed. lizzie, it's always nice to maybe catch up on how these guys are viewing the market. valerie you show me up. who knew that? the big shorts, my favorite film. oh, well, thank you. bloomberg's valerie title with a look through the 13 f filings

coming up counting down to the jobs data that are out in just a few minutes. the bank of england across the road from us. we'll be watching very closely and we'll take a look on the outlook for the uk economy next. this is bloomberg. guys. got hair loss. i know what you're thinking. should i shave my head? comb it over, wear a hat. just stop. this isn't 1970. keep your hair and your confidence because bosley, america's number one hair restoration experts, can give you your real hair back permanently. check them out because they're giving away an absolutely free information kit and a free gift card to everyone who scans this qr code. dude, you don't have to look like your dad because this isn't your dad's hair loss treatment. people all over the country trust bosley because they're ahead of the curve. they use the latest technology to give you your real hair back.

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market leading data reduces fragmentation between teams. we'll partner with you to define and deliver exactly what you need, helping you face change in ways no one else can on. this is bigger thinking. this is bloomberg for the side. learn more at bloomberg.com slash sell side. welcome back to bloomberg daybreak. europe. now we're expecting uk jobs data at the top of the hour. they're of course, going to be all important for the bank of england in terms of what it does with rates next, how long it keeps them high. and joining me now for analysis is our europe economist, chief europe economist jamie rush from bloomberg economics. morning to you, jamie. there's been a lot of talk, especially from people around

the government, about wages growing faster than prices. for the first time in nearly two years. i wonder how much that would actually be a cause for the for celebration, especially from the bank of england's perspective? yeah, if it keeps meaning that rates have to go up higher and higher, then i suppose it's not a cause of celebration. it's kind of a case of good news is bad news here. um mean? yeah. wage growth is much too fast. you know, above 7% is running too fast for the bank of england. it's not consistent with the inflation target. it would need to fall back to somewhere between 3 and 3.5% for the bank of england to feel comfortable that they're on track for 2% inflation. and we're nowhere near that yet. and how much of a hot wage print would you need to see jamie to change your outlook for peak rates? i think you currently see 5.75%, right? yeah. so we're expecting to hike in the next couple of meetings. i mean, i think it's unlikely that, you know, the risks to that view are probably skewed slightly to the downside anyway. um, so we would take a very big

surprise to change the outlook. we're actually expecting wage growth to come in a little bit faster than the bank of england was expecting anyway. um, but there is a lot of time between now and november. so i think, you know, we're not going to see a pause in september. they're going to hike again. the real question now is what happens in november? and we have got quite a few prints between now and then. and also, i'm wondering how much might any rise in unemployment disguise people who are coming back to the workforce out of inactivity? do we need to be careful with that number? i think it's something you've warned about before. yes. i mean, we saw the last the last sort of uptick that it was mostly led by an increase supply of workers. so it's changing the denominator of the the unemployment rate rather than numerator. so that's a different that's kind of a different reason for unemployment to go up. and it's not one that we kind of think means there's loads of spare capacity. i mean, what i would be looking for though, is to is is for vacancies to keep coming off because that's a pretty clean read on what's going on with demand for jobs in the in the uk. and so we are expecting that to

keep tailing off over the coming months. and when we talk about the uk housing market, obviously unemployment a factor, but how much this time when there are all these warnings about a slowdown in prices? well, i mean, if you look at countries like sweden, for example, you can see that you don't need unemployment to go up by a lot for house prices to fall by a huge amount. so, you know, we've got 20% drop in house prices in sweden, but the labor market is carried on just fine. so it's clearly a possibility that that happens in the uk as well. we do think that house prices remain overvalued. relative to their fundamental level, which is determined by long run interest rates and incomes. so we do think there's more, there's more space for house prices to fall in the uk before we get to the end of all this. all right, jamie rush from bloomberg economics, thanks. and i'm sure you'll be keeping an eye on that data. now let's take a closer look at china's unexpected medium term interest rate cut. the yuan hit a fresh low, nine

month low against the dollar. and china's ten year yield fell. we'll take a closer look at china's unexpected medium term lending facility rate cut to 2.5%. the biggest reduction since 2020. the national bureau of statistics said that domestic demand remains insufficient and the economy's recovery foundation still needs to be strengthened. so that rate cut came just ahead of the very disappointing july data. here's a snapshot of it. industrial output increased 3.7% from a year earlier, but that missed economists estimates for a gain of 4.3%. you also had retail sales growth slowing to 2.5%, missing estimates by a sizable margin as well. and the urban jobless rate rose slightly to 5.3%. now, the national bureau of statistics says it will suspend publishing data for youth employment while it reviews its survey methods. so here's what some of our earlier guests had to say about all these numbers. china is exporting more and its

currency is weaker. its inflation is slightly negative as well. that can last for a little while until domestic demand recovers, hours until confidence is rebuilt among entrepreneurs to invest again. and that's what's lacking so far. all right. let's check on these china markets. red flags have been popping up as we say, especially in the property sector. you saw country garden clothing closing below 1 hkd for the first time ever. last week. and then today, we've had this miserable data dump, the surprise rate cut, of course, an attempt to boost the ailing economy. so currently you've got the offshore yuan down 3/10 of a percent. it has been at its lowest level this year. and the csi 300 is currently down 4/10 of a percent. the hang seng index down 8/10 of a percent. but there is one easily overlooked bright spot amid all

of this negative news. bonds have been performing well in china, and actually they've served their traditional purpose. against this deteriorating backdrop, kgbs have outperformed the global bond benchmark for a fifth week. the rally today is a two sigma move. yields down 5 to 6 basis points. that's something that you don't normally see. as you can see in that chart also, let's just take a look at home depot, because we have a raft of earnings this week for us retailers. we're waiting for home depot today, but we also get walmart and target later in the week. so these results are out pre-market. they'll give us a bit more of an insight into consumer sentiment as us inflation eases further. our analysts here at bloomberg intelligence reckon that home depot is going to face a second straight quarter of slumping sales and they expect both spending by professional customers who make up about 40% of total revenue. and do it yourself customers to weaken those shares up 4.8% year

to date. so we keep an eye on those later. let's also just check in on stock futures ahead of the start of cash equity trading. you've got euro stoxx, 50 futures up 4/10 of a percent. s&p e-minis up a 10th of a percent. and nasdaq futures up 3/10 of a percent. this after the nasdaq rose 1.2% yesterday, driven by nvidia and other tech giants. that's your latest in markets. we'll have more of that on markets today, next. this is bloomberg. don't be wall street's useful idiot leading banks and brokers are paying you interest rates that are obscenely below market rates. why? maybe they made long term loans at lower rates and would lose money if they paid you higher

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