asml has dealt with a lot of geopolitics.pened covering closely -- you have been covering closely the idea of potential sanctions from the u.s. eating into what the bottom line might look like. i love this line in your reporting where you say asml's biggest customer tsmc dropped 11% in the third quarter. when i talk about the magnification of success and pain in the chipmaking sector, this is a great example. when it comes to the demand story what does the company say? april: when you talk about geopolitical tensions, the u.s. announced it is expanding the scope of manufacturing subject to export restrictions. asml said it is in the process of digesting regulations. in its preliminary assessment asml said the new rules affect a limited number of chinese factories that produce advanced semiconductors and it does not see a material impact on 2023. longer-term these rules would likely impact the regional split up its system sales. were that currently stands china made up 46% of sales for asml in the third quarter which is up fro

it is very much asml. asml has been underperforming through much of this year.of the stock market goes beyond china. there are also concerns about how much demand will prove over the next one to two years and how much they will need additional asml equipment into 2024 and beyond. it has two concerns on the geopolitics side as well as the underlying advanced ship demand, especially at tsmc. geopolitics is front and center and so far so good, asml seems to think. alix: where are we in the semi cycle. i know you do not cover nordic semiconductor but there read is not great. where you think we are in relation to that for asml? janardan: we think we are just about passed the bottom of that cycle. we have from the early part of last year, we were calling for a deep down cycle. we think we have hit that bottom and risen a little from that bottom. some sectors are delayed. others are going earlier. iod is probably a little bit slower and going through that deep correction, which is what is affecting all of these. we do not think we passed the worst but it is always a li

we have the cfo of asml talking about a dynamic macro picture coming from china.et's get into that picture with amy sellico. there were so many clouds whether it be the u.s. proceed against shipments to china and the chinese economy they we can get a read on. how much demand is there for a technology from international imports right now? >> demand is huge because international technology is so important for china to continue to push is economic recovery. the good news coming out of china with the q3 numbers beating expectations it is a slowing economy and the recovery is far from certain if china does not have access to that technology. clearly, investment is going to continue to be in technology, to have indigenous technology replace uncertainty around access. but in the short-term, chinese demand will continue to be significant from these technology imports. ed: let's head over to china, president xi made this thinly veiled comment directed at the u.s. that downplays the emphasis you should have on their progress and development of others and the risk of economi

tsmc and asml dealing with that. avril hong in singapore with the crucial update.l one more on your radar, pernod per card sales coming up, sales dropping by 8% -- pernod ricard sales coming up, sales dropping by 8%. the regional story's importance, maker of absinthe vodka, jamison whiskey. they are saying we can still make the guidance but at the end of the day, those organic sales dropping pretty substantially. coming up, we discuss a sustainable future economy within the norway based growth equity fund. stick with us. this is bloomberg. ♪ i'd like to thank stitch fix for always making me look great. for taking care of the shopping... so i can take care of this. i'd like to thank my stylist, now getting dressed is so easy. thanks for getting my fit just right. for finding me looks that work for me and my budget. for finding me my favorite pair of jeans. i'd like to thank stitch fix because, i look good. thanks stitch fix, you just get me. -they get me. -you just get me. and they'll get you, too. take your style quiz today. ♪ kriti: virgin capital advisors has rai

ed: asml makes the machines which makes the chips. china's domestic manufacturer made the processor that went into the huawei smartphone. sources tell us they made that ship with an asml machine. there will be questions about now what happens as it relates to the current u.s. technology export curbs on china. it is politically messy. alix: you cannot stop at all. it unveils how connected everything still is. thank you so much, ed ludlow, mandeep singh. more earnings in the next hour. mike siebert, the ceo of t-mobile, will be joining us about the state of his industry. more on the question of the day. what is the signal in the earnings noise? the banana group -- moneta group chief investment officer joins us next. this is bloomberg. ♪ >> and this is an incredibly important week from an earnings perspective. >> big cap names. >> all about the clouds. >> business at microsoft did well whereas it disappointed in alphabet. >> year-to-date returns have been good. >> mehta, alphabet is one that you want to watch closely. >> you think about

in asml's case. -- the u.s. has subordinate with the netherlands on the policy because asml is a dutch company, one of the most valuable companies in europe and one of the main loopholes of the initial export controls last october was washington went ahead but they had not got amsterdam and tokyo on board for some of the main chip manufacturers are located. caroline: we thank you for jumping on that news and we will stay over in washington and talk locally because president biden is set to travel to israel tomorrow at any moment. the u.s. help -- house itself will hold a vote announcing the new speaker. to the president and the anticipated trip at the moment. how are we anticipating this to be taken by the rest of the administration and by the republicans? kailey: this is something that president biden is doing at the invitation of israeli prime minister benjamin netanyahu and it is going to be a literal physical manifestation of the u.s. support for israel, a show of solidarity and it is a trip that the preside

asml.raft in the chip sector meaning more concentration within the business in terms of its topline which again represents more risk for that business. asml tracking lower as well. some big names reporting stateside over the next day or so. let's talk about tomorrow and figure out what's good to be happening. watch out for their, what's happening in the scandinavian market. that's good to be a factor i suspect. nokia earnings as well, we've just heard from erickson. we get sales from l'oreal. seems to be a slowdown, is that just related to handbags. will we see cosmetics being affected as well and then we get nestle. sales and revenue, this will be fascinating. talked so much about what's happening with the ozone pic story. will that be impacting what happens. are we going to be seeing this move away from focusing on price to focusing on volume. what is nestle doing and does it represent the safe haven at the moment. alix: interesting off of procter & gamble they're still able to pass along

certainly that's been an argument made by asml as well.ieve this is difficult to achieve, but with pressure coming on the administration, they have to be seen as doing something. alix: it begs the question, how far up the supply chain do you go? if you go all the way up, it's impossible to separate chip manufacturing and technology from one country to another. the same way if you are looking at the energy transition. it depends on where you put the stop sign. caroline: at what point do we go into the very making of a wafer within the chip? the whole ev area is dependent on the rare earths coming from china and the politicization. china is saying if you are upping the ante, we don't like the politicization of trade and technology. guy: looking forward to the show later on. bloomberg technology coming up in just over 90 minutes time. what are we going to be talking about next? president biden is considering a trip to israel as a diplomatic effort to prevent more from spreading across the middle east. the latest from tel aviv, washington. i h

and asml reporting a miss on sales.s on freight costs, freight rates. and the company warning we are not at a point yet to say we're out of the freight recession, although things are looking better. stocks off the worst levels down more than 6%. carl, it comes to the debate about hard and soft landing, higher for longer, the fed. the big story yesterday on the moving rates was the odds increased for november and december of rate hikes. still not above 50%. market still thinks the fed is done. however you get a strong retail sales, you get strong inflation number. a little bit firmer, strong jobs numbers, that's been the theme and you have to wonder if inflation is going to remain sticky on the back of that strength in the economy. so potentially one reason we're seeing the yields remain consistently higher. the atlanta fed gdp number it was a wow when it first came out, a wow now, revised up to 5.4%. you mentioned the sell side, the economists on wall street were not there. remember when it first came out, here's the ch

we've seen asml and lam research working out that the chinese are hoarding everything they can get theirxport restrictions that are now stricter. we think there is a substantial downside in revenues from china over the next year and they expect that. paul: maybe we can come back to the china question but in terms of the ipo i'm curious as to what you make of the timing because it seems pretty good. the nikkei is on a bull run, chips essential to national security, they picked a sweet spot here. >> in the midst of one to be honest, the best thing they could have done is to may be list it three or four months ago when the demand for aia was still there, very strong but things have changed. the sentiment has changed. yes the semi conductor industry has become a vital industry for the japanese and that will continue but as far as market timing, i think they missed the sweet spot by three or four months. shery: to your point of china hoarding does that mean you are not expecting a semi conductor slump to bottom out? i'm talk about the broader industry because there were high hopes that we had

a lot of it comes from asml, the dutch company which had not fallen under the rules before.more closely at the chipmaking equipment and may add additional controls. they were quite upfront, technology moves quickly and they may have to revise these rules at least once a year going forward. shery: we saw the reaction when it came to nvidia suppliers, are we expecting broader implications for other asian tech companies? peter: it certainly does limit some of the ability of these companies to sell into china. nvidia has been outspoken, asml has been very outspoken that it does not think the strategy of banning sales into china makes sense. in the meantime, you have seen china double down on their investments in their domestic chip capabilities. a are spending more than $150 billion trying to build up capabilities in many areas. the company that supplied to the huawei processor has been pushing and making the most advanced chipmaking gear. there are other companies that are investing in every area of the chip industry. china has decided it will push ahead, at least up until now

we think they are a long way off from being able to replicate what asml has done, but by repeating the process that intel and ibm and global founders use, smick and get close to some of the most advanced chips as is shown in that huawei chip. caroline: we ask you to put a policy hat on. do try to take that hat off when it comes to having the to such companies. you said you have limited your exposure because of some of the issues with u.s. china. what about nvidia that at the moment can sacrifice chinese sales. ultimately do you want to be out of companies that have such exposure to china? joanne: the investor hat, the portfolio manager hat requires you look at policy. you need to handicap what will be in the u.s. interests, what they will try to do, as well as the economic outlook. advisors capital we do both. we then build up the bottom up analysis company by company. nvidia is a great example. they have 70 opportunities. demand is so strong for ai capabilities. we think if they lose a little bit from china they will make it up elsewhere. it looks like they will have a waiting list of

you said the other companies are dealing with it, asml reporting earnings on wednesday. equipment maker for really all of the chip equipment for the world. thank you, jill. when i think china i also think about u.s. exposure to china and a big part of the story is bank earnings. which we know j.p. morgan reported another quarter of record that interest income and boosted its forecast for the year on friday. we are not done with earnings stories. joining us is charlie wells. talk about what stood out from friday's reports. charlie: going into friday there had been so much negativity around banks. we've seen bank stocks perform very poorly this year aside from j.p. morgan. the bank index down about 25% in a lot of concerns about what higher for longer could mean for banks. when you look at friday, there was a huge boost in the interest income for j.p. morgan and wells fargo and citigroup, which also reported friday, some traders there have their best third quarter in at least eight years. at the same time, jamie dimon warning that the bank was over earning in some areas an

this is the liftover fee company, asml.chip equipment and they're front and center in terms of the narrative of limiting ring fence in china. nestle has taking itself more to the healthier end of the spectrum. and it's going to be interesting to see whether that trend is paying off. and u.k. retail sales. there's evidence that the u.k. consumer is starting to really feel the pinch right now. the hire for longer narrative is feeding through the u.k. economy and we're hearing them talking about the idea that there's much of the tightening effect to manifest itself in terms of the impact. retail sales are going to be interesting. but the weather is reasonably warm recently. it's not a time to be out there and buy your winter clothes which i suspect many of the stores are stocked up for. maybe there's a sale opportunity. alix: now you're thinking like me. good job but it does bring up the question of economy data, what happens with inflation, when are we going to see the real cracks? the imf meetings wrapped sunday. both of tho

they don't expect a near term meaningful impact on their financial results whereas equipment maker asml says restrictions would impact sales in the medium to long term. intel makes china only chips and amd working with chinese hyper scalers, so both companies could be subject to controls and why you see shares sell off today. to shares of vmware are lower on a report from a chinese outlet that chinese regulators need more time to record broadcom's vmware. that has some spooked. shares down almost 7%. broadcom just got back to me and i'm told they still expect the deal to close october 30th. but what timing given the restrictions today. >> only two weeks to sort if that will be on track. kristina, thank you. >>> it's interesting, adam. do we have to look at this group, at least nvidia, maybe some of the other directly exposed ones as, look, for google, the entire world except for china is the end market, or friction we have to work our way through? did china front load chips or how do we sort it out? >> the immediate reaction were the same, no near term impact but might be medium or long

let me take your attention to asml. it posted third quarter earnings of 1.9 billion io ion euros al line with estimates. conductors are uncertain about the demand for recovery as it forecast flat sales. that forecast of flat sales would explain some of the downward pressure we're seeing. elsewhere, abb has posted $1.4 billion in line with expectations, but the swiss industrial group lowered expectations for the coming quarter saying it expects comparable revenue to grow by mid-single digits and be in the low teens. it's down 5.8% today in trading. the cpo of nordegren saidnorth america is still the driving force for the business. >> europe is showing the weak oeft part if you look at the three regions. germany is down 33%. but that is the comparable. we got some big orders last year. it's about half of that. but the source still quite weak. so the driving force is still north american. >> but there is a little bit of green on the board today. that is adidas. the stock is up 4%. the company has raised its revenue items a

as that translates to europe, you look at the chipmakers with asml as an example or the tech plays inpe. i think overall, a lot of the focus tends to be in the u.s. because of where the opportunities lie. >> let me ask you what are people saying about the higher oil prices? it is a macro question. it is an important one. we are seeing it having a manifestation today with the oil and gas names within europe. more broadly, people are saying this could be inflationary. how are your clients looking in. >> they are looking for opportunities. it is less around higher oil prices as an opportunity. it is more around protecting the opportunity. if higher oil prices are looking to drive inflation, should we look at the complex or at etfs around oil and gas or minors and that sort of thing rather than going into the oil futures. >> carl, thank you so much. fascinating conversation. we went around the world. great to have you with me. the lead analyst from finimize. >>> we will have results from wall street this week with goldman sachs and bank of america on tuesday and morgan stanley on wednesda

asml down 1.5% broadly, in the red across the board. taiwan semi, sk hynix and lenovo down.a check on the bond market. the 2-year note jumping to its highest yield since 2006 following yesterday's retail data. you can look right now. well above 5% at 5.1%, the benchmark 4.8. pretty close to its highs this year. we have to check energies. taking a look you can see it's moving higher, up more than 3.5%, trading close to 90 bucks a barrel. brent crude, pretty close to 93 bucks a barrel. also up just about 3.5%. that's your setup for the u.s. market. now time to get a check on the top corporate stories. our bertha coombs is back with those. bertha, good morning. >> good morning, frank. microsoft and amazon reportedly teaming up on a deal involved the cloud. according to insider, microsoft would bring amazon on as a customer for its 365 cloud productivity tools, the report adding that the union would be worth over a billion dollars. over the next five years amazon is expected to start setting up the new systems early next month. >>> carl icahn is suing current and former board me

for example, equipment maker asml admitting, quote, these export control measures will likely have an impact on the regional split of our systems sales in the medium to long term. keep in mind these new restrictions have about 30 days before they come into effect. we can see the reaction in all of the chips names today when this news hit this morning at 8:45. >> very interesting stuff. kristina, stick with us. i will turn to the panel. amy, you own nvidia. on this news what do you do with it? >> we've been trimming nvidia all year. we've owned it for over a decade now. it's a very long-term holding for us. i do think there are some signs to show that it is weakening. this is obviously not good for the stock. there's a question in my mind whether china was stockpiling chips in advance of something like this happening which would have inflated results like the strong results we saw the last few quarters. so this is a negative. i still think nvidia is a great company. it has long-term potential, but the stock has run up a lot. it looks like it's not that expensive, but the question in my

asml holdings up 2.5%., trade january desk, their all -- tradedesk, they're all moving higher. take a look at the 10-year treasury yield if we can. close to a 16-year high. it was around 4.7% -- there it is. till down 5.4%, basically 5.4 basis points, right around 4.74%. still very high. let's take a look at the price of to gold, just down a couple of bucks at $1838 per troy ounce. taking a look at bitcoin, i saw that earlier was moving ever is so slightly higher, up -- well, up $200 or thereabouts at $27,547. taking a look at the price of oil, opec+ today saying they're not going to do anything but keep those production cuts in place. oil though down at $86 a barrel. natural gas up 3 at just around $3.05. there you have it. that's the wrap-up of the market. all very muted so far. >>> all right, coming up, kevin mccarthy's run as speaker is finished, but is congressman matt gaetz a villain or a hero? liz peek talked about it, and she's going to discuss it with us. >>> the crisis at the border is getting wor

asml 15%, taiwan semiconductor up 15%. people believe in the chip stocks, don't they? >> yeah.e you can hear me now. charles: i can. >> do you hear me? i'm so sorry about that. yeah, so speaking of a.i. again i was talking about us going from the hype to the practicality part of the cycle. that is what we've seen from our customers as well. that data you saw is increase in holders across our global platform of certain semiconductor stocks, and i really think the a.i. picks and shovels trade is picking up that is why you're seeing increase in holders in semiconductors, hardware manufacturers, software. people now justifily see the a.i. theme as a little expensive, a little overvalued. they're looking for the secondary stories behind it. i'm encouraged retail investors are stepping forth and not just blindly buying into a.i. they're being more intentional about it, trying to understand where the opportunity is. charles: speaking of that what is the overall mood or temperament of retail investors right now? >> they're surprisingly optimistic, charles, optimistic but skeptical. we

we've got really troubling guidance from one of my ferret companies to follow from asml last week. make the machines used to build semiconductors and advanced microchips for a.i. okay. they warned for next year, saying they expect flat guidance as they're seeing orders canceled across the board. if semiconductor manufacturers are not going to expand production lines, what does that say about the growth for semis and chips for the next 12 to 24 months? if that is slowing there, that's a very good leading indicator that things are slowing down. are we going to hear the same things out of a microsoft and amazon from their cloud business where i expect advertising from google, from meta to be extraordinarily good. maria: do you want to sell into these rallies? because look, mike, look at these stocks year-to-date. double digit, even triple digit gains year-to-date. do you want to sell going into the earnings? >> well, look, i think the safer play for these ones or on the communication sector, the meta and the google, and a little bit more unknown in the amazon and as well as the micros

chip equipment firm asml reporting third quarter profits that were lower than the previous quarter, down the moment. the earnings did, however, beat analyst estimates. the company forecasts though flattening sales for 2024 as the u.s. places new restrictions on semiconductor exports to china. that's what's hitting the entire semi index at the moment as we already showed you. certainly nvidia, second day straight of big losses. >>> house of representatives still looking for a speaker after jim jordan's second vote now today comes up short again. he's vowing to fight on, but the house gop's civil war freezing the entire legislative process and hurting the republican brand ahead of a presidential election. one of those people hoping to win the top gop nomination is with us here live in studio. former new jersey governor chris christie here to tell us how he would advise the republicans to get their house in order and his thoughts on iran and the increase in saber rattling right now in the middle east. that and and more straight ahead. and who in their right mind says or, you know what? let

nvidia, amd and asml dropping as the biden administration makes it harder for the chinese to purchasea.i. chips from u.s. companies. it's set to close loopholes in the existing export controls and make it harder for china to buy existing or new products. tim, this wasn't entirely une unexpected. nvidia shares jumped all around on this, ultimately, though, you know, closing formid bly lower for a stock that side. >> there's a lot of different ways to look at nvidia, both in the microcosm of today's news, and as karen points out, if they tell you they're going to do this, they're going to do a lot more than this. i don't think the news is significant for nvidia. they get 20% of their sales from china, and at some point, nvidia is so good at adjusting and making -- they'll make a chip that will adjust to the standard. but when you think about the bigger picture of what's going on between the u.s. and china and the semiconductor war and the dynamics with tie yan involved here, be scared, be really scared if you rely on semis that have anything to do with going through china or taiwan. and

. >>> shares of asml falling sharply this morning, reporting a profit decline in q3 and forecasting revenueext year as flat, with u.s. kushes on tex imports to china negatively impacting the dutch chip firm, those restrictions will affect 10 to 15% of sales to china, which could be playing a big role in the sell-off, come 4% almost today. >> meantime, trying to bounce off some morning lows. let's get post-to-post with bob pisani. hey, bob. >> down today. and if you're hoping that cyclical stocks like industrials would do better because the economy is still strong, unfortunately, that story isn't really playing out. it's been a rough day for the industrials. new lows in some of these airline stocks, like alaska groups, remember, american airline, new low. united beat, but they talked about higher fuel costs impacting them. there's a little uncertainty about the tel aviv route. that's for them, for united. so that's weighing on the sector, generally. that's a big issue, but more importantly, i think it's the way the global industrials are acting. the caterpillars, the johnson controls. this i

moving on to the chips sector, asml falling after a miss on revenue and beat on eps. over 2% right now. however, it is really guidance that appears to be weighing on this stock. forecast is for flat growth in 2024 with the ceo calling it a transition year. the cfo added customers are getting more cautious with orders. shares of asml down 2% right now. all right, third, we have a possible deal in the retail space. some movement in the retail space, vf corp. down half a% percent in the premarket. but yesterday up 14%. you see the big spike right there. it is moving higher on news activist investor engaged capital took a stake in that company. andrew, back over to you. >> okay. >>> coming up, adena friedman joins us in a couple of minutes, former house speaker kevin mccarthy is going to be on the program to discuss the speaker impasse, the situation in israel and so much more. "squawk" returns after this. >> announcer: time now for today's aflac trivia question. where is the world's oldest and longest boardwalk? the answer when cnbc's "squawk box" continues. . and he's u