♪ >> welcome to bloomberg markets. as we hit noon here in new york, investors are digesting another round of economic data as they look ahead to the big fed meeting next week. let's get a check on these markets where we stand right now. the s&p 500 down about three tens of 1%, but more goes to the nasdaq 100, about half of 1%. down nonetheless. russell 2000 about 8/10 of 1% lower.

this is what i'm watching because now we have hit above 430 on the 10 year. nearly four basis points higher. we started the week at closer to 420. there is a mid day movers on the equity side that we are keeping an eye on. black suggesting allocating 1% to 2% of a multi-asset portfolio in bitcoin that is helping to drive crypto stocks higher in the session. a paper from blackrock's is that such allocation would produce a similar risk profile to magnificent seven stocks in a standard 60-40 portfolio and you can see shares of things just soaring. we are going on the heels of some activist activity. also adobe, they are tumbling. the biggest drop we've seen since march, after the company gave a disappointing sales outlook setting anxieties about losing businesses to ai-faced startups.

also watching coca-cola, pepsi, dr pepper. driving those shares higher. the analyst become more positive on nonalcoholic beverage stocks into 2025. more than 1% higher on each of these stocks. dr pepper leading the charge at about 1.8% higher. back now to the economic three yesterday, we got cpi, the day we had pdi and jobless claims. dana peterson explained why eggs have laid a big part in today's data. >> a lot of the egg inflation is because of the bird flu. not necessarily because companies are trying to get away with something, it is really just this external shock but absolutely inflation is sticky. some of it structural. you have fewer people working because they are retiring. that is raising wages and following through. insurance costs are rising across the board and also

shelter costs are not falling as quickly as you would expect so all of those things are asian sticky. -- inflation sticky. >> for more on what this means, i'm joined by mike mckee and liz mccormick. let's start with the data itself. the fed can't control the bird flu, right? but you're still seeing higher prices in certain areas that affect americans on a significant basis. you kind of joke with me, i could call it egg-flation if i want. what i received from the data and how should investors feel about it? >> basically we are seeing food prices up which is another reason the fed and others use the core rate. they take out trade services which is basically the margins for retailers and wholesalers and you end up with just 1/10 of 1% gain. it keeps the fed on track for a cut this week. we won't have the pce numbers out, but economists can figure

it out now that they have the ppi ingredients in that. some of the ppi categories that go into pce were very well behaved. things that we didn't know about pce, we do know. and that presents a much better picture than the cpi yesterday. sonali: if you take a look at the bond market and the reaction to it, even though we were talking about the move higher in the 10-year here, you are seeing the steepening of the yield curve as well. when you look at it all together, is it such a bad thing that you are seeing a decoupling between the short-term and the long-term? >> i don't think so and it seems to be not only a favored trade as you know, but it makes sense. people think other where they land the plane is an open question, that the fed is going to cut some more. but there's a lot of other risks in the long end.

let's look into next year with a new administration, exactly what policies go through? do we have more fiscal stimulus, terrence go through and cause more inflation? there's just more risk in the long end and if the economy is going to not crater and the fed cuts more, maybe short rates go down more than long rates. overall the curve steepen's. i think that is just where most people are leaning. sonali: is it too early to start previewing what you're going to see next week? if we start to have the ingredients already, what does that mean not just for what they do on december 18, but the way they start to map out the path forward? >> that is what is going to matter to liz and her friends on wall street. people want to know how many times the fed is going to cut rates and what is their view of inflation and growth and unemployment we get a new summary of economic projections, a new dot plot and the expectation is that we see fewer cuts priced in next year and the

markets will try to distribute those throughout the year. and we will see a slightly lower inflation forecast and a slightly lower unemployment forecast. and you work from there. i've talked to a lot of fed officials over the last couple of weeks and basically their attitude is all forecasts are valid until january 20, and then we don't know what is going to happen. we will get these numbers and you will have a month to react in the markets and then after that, we all have to wait and see what the new policies are going to be. sonali: for our viewers and listeners on the bloomberg terminal, there is a story that liz wrote. bond traders make risky bets on neutral rate, no one knows. if no one knows, who makes money in this scenario? the spread is quite wide, that is a perfect moment for wall street to capitalize on. >> i won't try to get to into the weeds, but this neutral rate

, that long run rate, not too hot, not too cold, as always like a theoretical level. you have models that look at it, but the models right now, the spread is very wide of where that rate could be, and the summary of economic projections, they have a long run rate. a lot of people use official forecasts for the long run rate as signaling where they think neutral is. and that spread has been very wide. for the bond market, some are saying there is so much uncertainty that the best thing to reduce risk, don't go over your skis. others had their strong view. they had their own models and many see the long run rate is higher now for a nhtsa reason, so they are saying what you are saying, avoid the long end, go to the shorter end. others are saying things haven't

changed, we are still going down ultimately and the shortened provides a lot of value, etc. it depends on what your view is. you can take a big swing or just be cautious. >> the ever elusive neutral rate. great story today and thank you so very much for your time. joining us now to move over to an equity market perspective on all of this, private bank global equity strategist at jp morgan. and you take a look, a day is not a trend but clearly the market is taking a bit of a breather. you have many wall street strategist pushing the bar higher for next year. nowhere near what you are seeing in terms of the run-up you've seen in equity market this year, and you think about the differential between the way people are betting on the stock markets vs. the bond markets. is the stock market the relative safe place right now? >> i think at the end of the day

we are trying to focus on the fundamentals and what the stock market is telling us. on the macro economic front, it is a mosaic of data that we are trying to interpret. but the base case is still for a soft landing in 2025, supported by above trend economic growth, moderated, but still resilient. a fed that is looking to secure the soft landing and while the pace of easing might slow down next year, we are still on an easy path. and you put those two things together and couple that with the fact that we are actually expecting to see a broadening of earnings growth next year outside of just the magnificent seven which has clipped 33% earnings growth year-over-year we are also expecting an inflection higher on the s&p 493 which means we still expected to be modest upside in the s&p going into next year as well.

sonali: what would start to worry you? what is the growth rate that would have you a little bit more concerned about putting more chips on the table? >> i think that if we started to see in moderation economic growth that started to shift economic growth from above potential which is what we expect next year to a little bit closer to below potential, that would start to be an area where some warning signs would be there and we would need to think through. but that being said, the biggest thing that we are focusing on right now is i know the headline numbers, modest return on expectations for the s&p 500 next year for a price target by the end of the year may not get people out of bed with those kind of returns. however, under the hood, we are seeing dispersion increased so we are trying to be very active in the sectors that we are focusing clients on in terms of next year, and one of our highest conviction sectors within the s&p next year is asked her -- actually

industrials because be at the industrials are at a sweet spot between a cyclical recovery which we expect to see, as well as an acceleration in the secular investment that we are expecting to see in that space because the cyclical recovery will lead to more manufacturing activity within the u.s. sonali: is it getting dangerous to buy broad sectors when there are so many winners and losers? you are seeing the best of every industry gain more share, and the worst really fall off a cliff. we are nearing the end of the earnings season. you are seeing that particularly planned for the ai trade. at this point, do you really need to sell the losers? >> i think that you need to be active, which means trimming some of the areas where there's already been a lot of optimism in the price, and we've seen a lot of concentration even from the rally perspective in some of the biggest names out there within the mega cap tech space. but that being said, the biggest

thing we are thinking about right now is where those future returns are going to be moving forward. the hyper scalars are still going to be dominant when we think about artificial intelligence. the to your exact point, there are so many opportunities outside of that. get out networking, about power, even customize processors within the software space. so to answer it many more acutely, we do think that active management is going to have its time in the sun next year because not all subsectors within these industries are going to be made the same next year. sonali: so good to have you on set with us. private bank global equity strategist at jp morgan. coming up, carlisle announcing its biggest ever pool of capital raised for the latest fund in particular. carlisle investment head of global credit mark jenkins joins us next. stick with us for that conversation. this is bloomberg.

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so everyone can follow their own road. that's energy in progress. ♪ sonali: this is bloomberg markets. carlisle announcing today that it has raised $5.7 billion for its latest like should credit fund with more than $7 billion of leverage is the fund's largest ever credit pool, roughly $6.4 billion raised in 2022 for opportunistic credit. for more on this we are joined by mark jenkins, head of global credit had carlisle investment management. and we had to put this in the context because you are looking opportunistic credit. you have $200 billion in credit here. so why is this bullock capital so interesting at this point in time? it looks like you are looking in very specific, nimble ways to get into the market. >> thanks for having me on.

this is a very important step forward of the continue to develop a broad platform that we have. opportunistic credit is one of the core strategies on a very diverse platform for us, so we focus on how we can have a diversity of products we can attack or look for opportunities across the market. opportunistic credit for us is really working with family, employee-owned businesses that we structured the spoke transactions for, and they are typically under banked organizations that look for capital solutions up and down the capital structure. so i think we have a unique perspective in that regard and have been building that reputation in the market over the past seven years. sonali: it's interesting because ever since you saw the silicon valley bank step back and then use all the interest rate movements really shut out a lot of banks from the market. if this opportunistic opportunity bigger now that you are seeing the banking system stepped back, the bid? >> i think it is kind of

twofold. these companies, generally the opportunistic strategy for us is going to where there's fewer participants, so part of the pullback in the banking system is not serving these companies well, if you will. we also have a very large team in europe as well and there is a great dispersion, if you will, in fragmentation in that market so it does create a lot of opportunity in terms of have a banks are pulled back. but overall it really is bringing the full scale of the platform to bear capital solutions, and i think that is the key thing for us in terms of strategy. sonali: what is the return profile? what can you expect back on a strategy like this and how does it compare to other types of credit? >> because of the complexity and the bespoke nature of it, you are charging a premium above what summit we get in the capital markets. you are looking for returns that are three to four -- 300 to 400 basis points above first direct

line fuel. sonali: it seems like carlisle and many of your peers are looking at direct lending and saying yes this is a large opportunity but maybe there are larger ones elsewhere. you've been diving into asset-backed finance, more opportunistic credit as well. what does this mean about the biggest growth areas for your credit business moving forward? >> for us, we can kind of consciously building up his platform spanning everything from liquid corporate credit, private credit, real asset and asset-backed so that broad spectrum, if you will. and right now are our power rallies are really on the opportunistic side and asset-backed side, and i think that is where we see the growth. it depends where you are in the cycle. in 2023, the market was closed effectively. we didn't do anything. this year we had a record year pricing over 36, refinancings and new issues, and we raised over 900 million dollars in third-party equity, so quite a change. so you have to have that diversity to take advantage of

the market opportunities as you go through cycles. cinelli: how are these things serving as power rallies, if the something about these markets growing faster now than they were before? >> specifically you do have this secular shift that we see in assets that were not ordinarily available to us for private investment are now coming into the marketplace because of the shift we've seen from basically banks in the united states in particular. it has to do with regulatory changes, some accounting changes, and that has been a secular shift that we've seen over the past three years and really has come to fruition in the past year where we are seeing more opportunities vs. capital formation. we see that is a great opportunity for investors and certainly an area we are going to lean into over the next several years. sonali: as money flows at the private market, where is the risk? record issuance raising concerns because of the pik provisions that are rising as well. you look around the world hear

that you operate in, where is your biggest concern? >> i don't think it is so much the flow of capital into the private markets because when you think about who the actual investors are, they are much better matched to the private nature of it. on balance sheets, you are financing those with customer deposits, the capital markets. it is not necessarily matching asset liability matching. in the private market you are looking for much more, longer investment horizons so you can ride the volatility that you might see in credit. so the real risk isn't so much in capital coming in. obviously as capital comes into certain pockets, some places get very expensive, and that has always been through different cycles. i think the bigger issue is how we deal with the economic environment going forward as opposed to anything that is going to happen in the private capital markets. sonali: there is this notion out there that public and private markets are converging, where some private capital providers

have said no way, private is private, public is public. i do you feel about that? >> i think equity is equity. nobody is saying should this be private or should this be public? they are thinking about what is that exposure that i have in my portfolio and i think the convergence that occurred coming out of 2023 is you seen both public and private markets and credit in particular coexist in a very frugal manner for the community, if you will. and that is creating better opportunity. when i look at carlisle in particular and look at the deals we recently financed this year, they are very large buyouts, use the private markets to finance them and at some point in the future no doubt we will look finance in the public markets. so they coexist as opposed to compete, and at various times they rub up against each other for the competition or that tension but they are going to coexist going forward. sonali: you were talking about the macro economic environment.

what happens next year? still a substantial amount of rate cuts priced in, but investors also worry about even the possibility of a hike if certain policies come into play like tariffs. are you worried about the dispersion here? >> i think our view is that we are going to have higher rates for longer. we had that view for some time now. the macro economic, geopolitical tension that you see and the new administration coming is going to be very pro-business which i think is a good thing. it's going to keep rates at a relatively high level. it is good for the quiddity in the marketplace but it is only about 50 basis points higher than when the fed started raising rates in march 2022. you've got a very good environment right now for financing and there seems to be good momentum in terms of the economy.

so when you look forward to 2025, we obviously are going to see some volatility but i think we are in a very safe environment for investing. sonali: we thank you so much for joining us here on set. on the heels of a record-breaking fundraiser. coming up, president-elect donald trump rings the opening bell at the new york stock exchange earlier today. next, a look at what he had to say during his visit. this is bloomberg.

♪ sonali: earlier today, president-elect donald trump rang the opening bell at the new york stock exchange. he also talked about his tax plans. take a listen. from: the economy i believe is going to be very strong. we do have to solve some problems. we have wars going on that we didn't have, a lot of things happening that would have never happened. they would have never happened, but now they have happened and i

want to get them solved. we are cutting your taxes, we are going to cut them very substantially. we got them down to 21% from probably 42% or 44% depending on where you are, everyone said that was a miracle. now we are getting them down to 15%, but only if you make your product here. otherwise you pay 21, which is not bad. it is middle of the pack. sonali: of course that is the president elect at the new york stock exchange this morning talking a little bit about his economic plans and being on the cover of time magazine. we want to bring you what is going on with the latest in markets because of course we are on a down day today. the s&p 500 down about 2/10 of 1%. nasdaq 100 down not as much as it was a bit ago, about 4/10 of 1%. looking at a two year yield only about a one basis point move. the 10 year is interesting, almost for basis points higher. a little bit of fluctuation

across the bond market on the heels of economic data this morning. jobless claims higher than expected. we are going to shift gears and talk to richard branson goldman sachs joining us with his outlook for big banks. this is bloomberg. -- richard ramsden. t air balloon ride? swim with elephants? wait, can we afford a safari? great question. like everything, it takes a little planning. or, put the money towards a down-payment... ...on a ranch ...in montana ...with horses let's take a look at those scenarios. j.p. morgan wealth management has advisors in chase branches and tools, like wealth plan to keep you on track. when you're planning for it all... the answer is j.p. morgan wealth management. where can nfl fans get a great deal that turns christmas day

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♪ sonali: and welcome back to bloomberg markets. let's get a check on where the markets stand right now. a down day as we've been talking about in the s&p 500, down about 2/10 of 1% lower. more goes to the nasdaq 100. some tech earnings after the bell, 4/10 of 1% lower. this is the biggest loser today, yields are higher. that tends to impact also the russell. i am also looking up at 210 curve because even seeing yields

higher, you are also seeing a greater steepening of the yields curve now at a differential between the tens and the twos about 14 basis points. really good for financial stocks which brings me to my next point. yesterday i spent times of the goldman sachs financial services conference here in new york city and here are some of the highlights for my conversations >> heading the 25 there are some uncertainties. >> i'm afraid that the markets are becoming overextended and that some time in the future, we will have a downturn in the markets. but i don't think it's going to be very violent. >> we will have to see how the economic growth continues to unfold. >> there is a lot of pent-up demand. people who have largely been sitting on the sideline for 24 months. i think it is more important that we have rate stability at this point as opposed to needing

to see rates come down dramatically. we think we have what it takes to continue to grow and we have the scale right now and we think we are going to be able to more than double the business over the next two years. >> i think we are on the verge of a really big uptick in m&a. we are in a multiyear cycle of extended m&a activity. one thing is clear, companies that don't have exposure to the united states want to have more exposure to the united states. sonali: now, none other than richard ramsden over at goldman sachs. big conference. i heard about 1300 people had registered, almost 1400 people. what was the takeaway? i was trying to read the room the whole time i was there on just how much optimism there was. his next year going to be kind of good or really good or very good? how did you feel at the end? >> we findling this conference for a long time. this was the 35th that we've

done, and this was definitely toward the more optimistic. a few things that stood out to me, the first is the banks are pretty upbeat about the economic outlook heading into next year. these banks obviously have got great data around what is happening to consumers and corporate's, and they say consumer spending is still healthy, corporate confidence is improving. everyone that spoke said we are inspecting a pretty sharp recovery both in m&a activity as well as ecm activity. and then lastly from an operational trend standpoint, these banks have seen interest rates come down, have been able to bring down the positive pricing and at the same time, the steepening of the yield curve has led to more repricing on the asset side of the balance sheet, so i think they are feeling a lot better about the revenue. sonali: what is interesting is

that you have really seen a shaky movement toward that steepening trade, and if that is the truth, if that is what you are seeing, are not necessarily getting a blowout steepening here, and how does that impact the banking sector? does it mean that the trade will move more toward those m&a focused banks rather than those asset-sensitive banks here? >> the steepening of the curve is very positive especially for some of the bigger banks. jp morgan i think was one of the highlights in terms of the presentation that they gave and they said the curve has steepened roughly 40 basis points since they last spoke and that is going to add roughly $2 billion to the net interest income next year. i think on the m&a side, i think the pickup is driven by a couple of other factors. the first is this improving corporate confidence. the second is this expectation of a broad deregulatory way of going across the economy. and third, the fact that

financing markets are wide open. if you think it out, day, we are still running below 10 year averages and i think the expectation is we are going to move back at least to the average but potentially above. >> speaking of above, he said you could get the best levels in a decade you are analyzing and looking at what everyone is saying, who did you feel most different the about? >> jp morgan bank of america said they felt very very good about the guidance in the fourth quarter and they expect that is going to grow into next year.

jim has been making a lot of strides on that business. how competitive can they get in their core wall street businesses? >> there's a number of banks investing quite significantly in the capital markets. bank of america is one, but also wells fargo talk about this. if you think about relative the 2019 and equity markets and debt markets and sovereign markets, it is much larger. some of the larger banks have been under a lot of capital pressure over the last four years. trying to manage that capital pressure by limiting growth in certain areas, i think that has created an opportunity. and thirdly, some of these other banks are looking at the

corporate and commercial relationships that they have and saying that we can probably do more in terms of increasing product presentation relative to what we've done. sonali: so in anticipation of the m&a come back and the net interest income story, the steepening of the yield curve, you've seen the bank index rise more than 38% this year. are you saying there is a lot more that came from? what is your expectation for the growth of the banking sector next year? >> we are still pretty optimistic. obviously banks have done very well this year, they've done very well since the election. i actually asked a number of ceos is this rational exuberance or irrational exuberance, and i think most of them feel that it is toward the more rational and of the spectrum. and that is because of all of these tailwinds that the industry has. deregulation is another potential tailwinds that we could see not just for the banks, but just across the economy which would be another driver to increased activity, and if you look at where valuations are, yes they are

toward the higher end of where they are traded relative to history, but they are certainly not stretched when you look at them relative to the market. sonali: we thank you so much for joining us. coming up, earnings after the bell today. we take a look at what markets are looking for at the chipmaker that has been in the headlines this week. we are going to talk more about that next. this is bloomberg. i earned my degree online at southern new hampshire university. after i graduated, i started a new job. i was finally able to realize my purpose and passion in life. pursuing my degree gave me so many opportunities to grow don't just think about yourself. think about the lives that you can really change. snhu laid the groundwork. i am doing what i've always wanted to do. if i was back at the beginning, i would choose snhu all over again. (♪♪)

♪ sonali: this is bloomberg markets and it's time now for the stock of the hour. it's warner bros. discovery. the company which is the parent

of hbo and cnn, that is the global linear networks and a streaming and studios unit. hannah miller has been covering the story for bloomberg news throughout, and it's interesting to see the stock move because you've been talking to me about this, that this as kind of been expected. what do investors like about what they are actually doing now? >> there were reports of this potentially happening over the summer so it is not a huge shock the industry. we've seen a couple of media companies focused on their streaming businesses, comcast nbc universal is actually spinning off its cable network and focusing on nbc and peacock. so this is sort of in the same vein and investors see the separation between the struggling cable networks and the growing streaming businesses. sonali: so is this basically getting ready to do something much more strategic? if you are separating two businesses, what you would think immediately, is there m&a, if

they spin off, is there something on the other end of this? >> the keyword is flexibility. they want to have that nimbleness with this new it ministration coming in. the industry expects that would be a more favorable environment for dealmaking and consolidation, and that dividing up the assets, having separation could make it more appealing to buyers. sonali: how attractive or unattractive is one unit vs. the other end if you are splitting up two units, what does that mean between the push and pull? >> everything is about profitability. seen several streaming platforms with amazing results in the past year, a ton of growth, new subscribers. that is where a lot of people see the future of the industry. with these cable businesses, they are legacy businesses, they are big names but they have been struggling. we've seen companies write down the value of the cable networks warner bros. sonali: the last time you saw this company tried

to pursue m&a, it didn't go so well. is that going to be different this time around. >> we've seen a lot of positive attitudes toward the new administration and more favorable regulatory environments for dealmaking. >> what do we know about what david zaslow of is up to? if you are getting ready for 2020 five, dealmakers and the industry tell if they are trying to get front-footed. how quick, how intense is that behind the scenes need to get something done in terms of a deal with somebody else, a partnership, something to boost these divisions that are now split into two? >> they want to get this internal reorganization finalized by the middle of 2025. david zaslow has spoken a lot about wanting to be more flexible, wanting to shake things up with this company. it has really been greeted with a warm reception looking at the

rising stock price. >> certainly very hard to move that large of a ship. but it is a tight timeline, and some might say not fast enough. what do you think investors by in large feel about how fast they are moving? >> they are always looking to the next thing. really we saw in the most recent earnings call for warner bros. that they really emphasize the growth of max. this is where they are putting their eggs, this is the future they see for the media industry and they are combining that with a profitable film businesses. they had some hits and misses in the past year so we will see what happens. >> certainly some great shows on max right now. we thank you so much for keeping an eye on all of the news for us. she covered the media industry here for us at bloomberg news and now we are going to go to another mover. this comes on the heels of a report this week that apple is working on an ai chip with broad,.

for more on this we are joined by bloomberg intelligence in san francisco. first, perhaps set us up on what you expect out of the earnings. you've only seen a 60% jump in the share price this year, but when you look at that compared to nvidia, it pales. but is that mean that there is more upside or downside risk at the end of the day? >> we expect a very strong earnings spread. q4 should be robust given the seasonal ramp of the wireless segment. expecting a sequential rise, and also, people don't have this a lot, but the non-ai cyclical chip resistance. the two key factors that investors are going to focus on are going to be the one q guide. and the possibility of the company getting a full year

fiscal revenue guide which would be pretty big if they do get that data point. sonali: talk a little bit about what they have been doing in terms of partnerships, because when you look at this apple news you saw a lot of exuberance behind it. do you think that it was justified, or do you think there's actually much more upside ahead? wondering if they were to give details on what that looks like as they report, whether they could drum up some more excitement around it. >> this definitely a lot more upside in terms of how much more business they can gain. i doubt they will talk about at is very early stage. but look, all of the big consumer internet hyper scaler cloud companies are doing their own basic chip design, so that is not a secret. broadcom has the majority share of this market, and this apple deal, the share is actually is standing now to the third or fourth big customer, so this is really positive. sets them up for growth not just next year, but beyond that. the initial deal that was

announced is still a small piece of the custom portion that broadcom would be doing, but this puts them on the table to gain more share going into future designs that we think apple is building, especially as they try to spend their chips in their data center area. sonali: i understand that you believe they could outperform here, they have more upside space. but you look at their most recent result and the worries are around the non-ai businesses. how much does that matter at the end of the day? >> overall for their total company it is not just ai, it is a massive business. you 40% in software, 60% in semi's and there is still a big chunk of revenue coming from the cyclical non-ai chip business. so at the end of the day in terms of free cash flow and topline growth, that does matter. however right now the sentiment is purely around the ai business.

sonali: at what point do you think investors are going to have them start to focus more on the ai part of the business vs. what is outside of it? >> the key thing investors want to know if they will give a guide for fiscal year 2025. another thing to point out is this at the time they typically announce different races. -- dividend raises. another positive announcement or outlook would be a debt paydown going into next year, and that could result in them going back to buyback. sonali: if they don't rate the dividend is much as expect, that the enlarged downside risk toin? >> that would definitely be a surprise for their long-term investor base who is focused on the free cash flow yield that this company generates. that could be some level of disappointment. sonali: lastly, when you think about them and their rivals, where they stand at the end of the day and the longer-term trajectory?

>> they definitely rank in the top percentile. looking at the size of ai revenue right after amd and nvidia, it is mainly broadcom which is a pretty big name. these three are the ones taking most of the shares when it comes to ai chips right now. sonali: we thank you so very much. i want to bring you some breaking news as well because we are looking at an ipo just soaring upon its open. we are looking at service titan shares opening much higher than the $71 ipo price. 42% higher at $101 per share. we will keep an eye on that trade as the day goes on because of course, the ipo market as all of wall street has been hoping for is alive and well. now coming up, walmart expanding a push into financial services. it just announced a new fund raise. those details next. this is bloomberg.

♪ sonali: this is bloomberg markets and i'm sonali basak. we are looking at walmart going full speed ahead on fintech. walmart scored a two point $5 billion valuation for its financial services startup the it is a little unicorn building inside. it is a signal the company is trying to expand its footprint in financial services. for more on this, we are joined by -- and now accidentally covering e-commerce. when you look at what walmart is trying to do, $2.5 billion, great that we have another unicorn on our hands, but it pales in comparison to the highflying unicorns you see in financial services. what is the ambition? >> that is important to state up front. does a unicorn even count anymore? however, this is important

because it is fintech. while it may be independent, it is majority owned by walmart and we don't care so much about what valuation is today, as what it could become. because you just have to go a year and a half back with jamie dimon reading's annual shareholder letter thoughts about the competitive threat and the extraordinary benefits that firms like walmart and apple have if they encroach on their turf, if they go deeper into financial services. why is that? the actress to a loyal customer base that runs into the hundreds ons and the enormous resources at their disposal. so with walmart were to put its heart and soul into it, it might not be big right now, you're talking about annually 200 million dollars, but it could be something. sonali: you think back to the old morgan stanley days, stocks and socks. you think about ben sears model with morgan stanley. do you think that walmart risks going too far in that direction? >> i don't think it is a risk.

the bigger question, do we see a future where 10 years from now jamie dimon is dethroned as the king of wall street? absolutely not, that is not going to happen. walmart does want to diversify. it has talked about the idea that when it comes to financial services, it has been punching below its weight. it is a market that exists for them. why would they not want to tap into it? they have to execute well, that there is a very clear and apparent opportunity for them right now. sonali: so the work is being led by a former golden partner. a lot of interesting former golden partners in the wd of fintech. omar ishmael, what is he doing? >> 2021 when goldman sachs was doing its own foray into online banking, the time when walmart hired, it was an audacious poaching because we were going to the heart of goldman sachs and saying yes, you have these two people who will -- who will

build your consumer banking effort but we want them for our effort. but the thing that i would like to point out is that omar's success or failure is not going to determine the success or failure of this fintech. ultimately it depends on walmart and whether it is given the keys to the castle. will it with enough resources? clearly they are doubling down by adding more than $300 million to this platform, so they do seem committed to it. how long will it last and how long will this stay? that is what we want to see. sonali: thank you for joining us. always looking at what is happening in the world of finance. i want to bring you back to the service titan shares. exciting and up more than 45%. it opened at $101. 42% above the $71 ipo price. it is now trading closer to $104. we will keep an i on the trade at the day goes on but the ipo pop is back. that does it for bloomberg markets today.

higher ipo's even on a down day in markets, impressive moves all across wall street. that does it for bloomberg markets on the day. this is bloomberg. ♪ ♪ ♪ something has changed within me ♪ ♪ it's time to try defying gravity ♪ ♪ ♪

>> from the world of politics to the world of business, this is balance of power.

life from -- live from washington, d.c. joe: donald trump brings his case directly to wall street. welcome to the fashion show in politics. the president-elect rings the opening bell at the new york stock exchange after being named times person of the year once again. thanks for being with us on the thursday edition of balance of power. he made some news today at the stock exchange on tax cuts, ukraine and a few others. kailey: in the interview with time as he was named for the second time person of the year but on taxes, we have heard from trump already he wants to lower the corporate tax rate. but also bloomberg out with some exclusive reporting. stefan again lie suggesting -- stephanie lie announcing trump's advisers are digesting lifting