venerable asia, ubs. -- bhanu baweja, ubs. this is bloomberg. ♪ anna: welcome back to bloomberg markets. i'm anna edwards with alix steel. let get back to our question of the day. where is the biggest risk from qt? stay with us is behind her but wager -- is bhanu baweja. bhanu: it is going to continue, and we are going to see the footprint of the fed as a portion of the overall markets. over this period it is going to decline by about 10 percentage points. between 17 and 18 is where they end up by 2024. we have a data point of one previous occasion in which the fed has done a -- done this. the way to think about this is in three steps. the impact qt is going to have on premiums. the impact it is going to have on credit steps, and then the impact that both spreads are going to have on equity valuations. we have done the math we think that in the worst case where the fed does increase -- the treasury increases the supply of duration, that is a five multiple headwind, which is 10% over a three-year period the s&p, just coming fro

that is the view from anna titareva, european economist at ubs. 50 basis points on the table for the next meeting. coming up we will have more analysis of the g7 summit in germany. leaders are expected to commit to providing indefinite support to ukraine. that is next. ♪ francine: welcome back to the open, everyone. we are 42 minutes into the european trading day. and i slipped for stocks for the moment they are getting there cube from what we saw in asia. investors think central banks will normalize policy. let's take a look at what we will watch for this week. g7 leaders continue their three-day summit in germany. tuesday nato leaders gather in madrid. ecb leaders hold their forum in portugal. hong kong marks 25 years since the handover to china. state media reporting a visit by xi jinping and we are getting some cpi data. tom: let's get back to the g7 meeting in bavaria. leaders are expected to commit to providing indefinite support for ukraine. there also said to be discussing a cap on the price of russian oil. this as moscow defaulted on its foreign currency debt for the first t

. >>> before we go, ubs upgrading tesla. on the tape getting upgraded to a buy. buy ubs.e is brighter than other. 1,100. ubs upgrading tesla to a buy brighter than ever sounds like our future everything's an going to be fine i'm off tomorrow i'll see you next week "squawk" and the gang is coming up next. have a great day and great weekend. take care. we cou ring it right to your door. with 1 to 2 day delivery from your local cvs. or same day if you need it sooner. but aren't you glad you can also just swing by to pick it up, and get your questions answered? because peace of mind is something you just can't get in a cardboard box. that's how healthier happens together with cvs. at xfinity, we're constantly innovating. and we're working 24/7 to connect you to more of what you love. we're bringing you the nation's largest gig speed network. available to more homes than anyone else. and with xfi complete, get 10x faster upload speeds. tech upgrades for your changing wifi needs. and advanced security at home and on the go to block millions of threats. only from us... xfinity.

composite now below 12,000 and trading down by 0.8% on this down day, shares of tesla are trading higher ubsrading the stock to buy saying shares can rally more than 50% from current levels we will trade that stock later in today's three-stock lunch shares of ollie and signet, and the yield on the ten nf year yield remaining above 3% ty >> thanks, seema tomorrow's cpi report could answer a key question for investors and that is has inflation peaked the debate around inflation leading to tumultuous inflation in may and it briefly fell 20% from its recent 52-week highs and that's technically a bear market, boy, it has felt that way whether it's technically that way or not. the dow losing before rallying back at month's end and our next guest expects more volatility into the summer. he's mark lashini from janet, montgomery scott good to see you. let's look ahead to tomorrow's inflation number are you expecting signs that inflation has or is soon to peak >> i am, tyler i think we've seen several indicators that we are set up to see that occur and hopefully continue to in the coming months becaus

that's what they're taking advantage of and that's why ubs upgraded them today.hen you look at nio, yes, it is growing but it comes off a very small base in china i hear this from people all the time, sara, what's going on with nio? >> it's growing, but it's very small. >> it is interesting that it's one of the most actively traded names here at the big board every single day like the last month. phil, thank you. small, maybe high momentum there. phil lebeau. >>> stocks are sinking here into the close, we're down 2% on the s&p, the dow is down more than 500 and the nasdaq is bearing the brunt of the pain, down 2.4% ben emmons joins us. ben, we've been talking about how we've been in this trading range for stocks in the last ten days or so and we're starting to break below it ahead of the cpi report what is today's action telling you? >> hi, sara. yeah, we're in a perfect downtrend, right if you look at the s&p, you're sitting right below the 4200 level and the 50-day moving average is moving down and the 100-day is moving down it's really the reversal of last yea

joining us now is kiran ganesh, global head of communications at ubs.you look at the market strangeness, is that also a cfi level five work, where you find opportunities? kiran: we are focusing on value essentially. that's not done quite well, but we think the back trend is going to continue. when inflation is elevated value starts to outperform. tom: how does that trade -- kiran: we look at financials and things like energy which are sensitive to growth, energy is supported by oil prices. financials are going to do well out of this rising rate environment. tom: financials have not performed well year-to-date. kiran: when we look at the difference between financials performance and where rates are today, there is a historic gap starting to open up. when we look across the value sectors that is looking cheapest at the moment, maybe more confidence needed that we are going to avoid recession but we think that sector is looking relatively cheap today. francine: is there any commodities we should be buying right now, and is there a commodity where there is

a note from ubs, buy aussie dollars. that ties into the china story as well.in, up four and a quarter percent. dani: it is kind of an awkward timing for bitcoin to be doing so well because if you were to see our latest survey results, it was one of the top things that is likely to get hurt by qt . this is the markets live pulse survey and we asked which assets would be the most vulnerable to the start of quantitative tightening. the overwhelming response, along with crypto, the bubble of easy money darlings about to deflate. >> they have to do qt. they don't have a choice because there is so much liquidity in the system. >> liquidity will become a problem. >> we will see a withdrawal of liquidity start to bite. >> they have to remove liquidity to stop speculation. >> i don't think the slow beginning of runoff will cause raw -- because volatility in and of itself. >> not a surprise right now. >> we are seeing it priced in. >> it is very much in the price right now. >> the way we are thinking of this is the end of easy money. >> qt is not an unknown. >> i don't

joining us is the head of emea capital markets at ubs, garrett, what a turnaround in terms of capital sentiment from a few months ago, what is your sense of how the second half of the year plays out for capital markets given the concerns about inflation and the deep recession risks? gareth: we have had a liquidity driven rally for the last number of years that led to very low volatility and elevated levels of issuance from a capital markets perspective. the answer to your question is it is very much wait and see. over the summer, the precondition for a healthy second half of the year will be driven by the vix index which is driven by the view on interest rates. so we really need to see the vix back at or below 24 a sustainable period of time to allow us to execute a healthy pipeline for the second half of the year. tom: before we get to that point, what do you see currently as the biggest tail risk in the second half of this year? gareth: i think it remains interest rates and central-bank activity. we are in a tussle in the market where equity investors are trying to determine the pat

you may have answered the puzzle >> these are names that are somewhat leveraged to europe you have ubs cutting abunch of targets on snap, meta, microsoft, google, pins, and by cutting targets, they take goog from 3,600 to 2,650. >> but the price targets are still well above one of the things that is most disturbing to me is when people cut price targets they still keep their buys. we had jeffreys downgrade five chemical companies that has to happen we don't have capitulation if everyone is cutting price targets and saying buy they don't need to cut the price target and have people lower the stocks >> they do research lately is of little value, and i'm trying to be kind >> i like that pretty good. >> yeah. what i also noticed in the last 24 hours, carl, is people are talking about a deeper recession. suddenly it went from are we going to have a recession and half the people are talking about it could be really bad i don't know >> retail sales miss and in real terms down more than 1%. you have the atlanta fed look at zero growth this quarter scott minor said you take consumption and mayb

and the infrastructure which are all due to damage from ubs, had been watched with the grades which have been harvested, a light start life dude altogether. and a water point, the additional facilities being watched. oh, it saw a massive air rehabilitation would require a immediately after, after the flood, as for medium dom hossein, a deep thank you. thank you. i, here's a round up of other stories making use this era. an international monetary fund delegation is had a to show lanka as the country seat, a loan loan program to deal with its ongoing economic crisis. lanka has run out of foreign exchange to import essential items including food, fuel, and medicines. experts believe that immediate relief from the i m f is unlikely so called islamic state as the so called islamic states said it carried out the attack on a seek temple in the afghan capital. cobble 2 people died and several were injured . the jihadists said they were retaliating for alleged insults against the islamic prophet, muhammad, the un says afghanistan must do more to protect religious minorities. french voters are cas

there is talk that if somebody else bid, that would give ubs a chance to do a deal combination but iertainly hope that that is not the case? matt: is europe ready for big cross-border bank m&a? david: i think you cannot have cross-border bank m&a in europe on a wide scale until some of the rules and laws are changed. at some point this might happen, you still have markets which make it not conducive to cross-border. there is a possibility for some isolated levels on basis, but i think at this stage you still need regulatory evening out that would make it more conducive to cross-border m&a. on the other hand a company like credit suisse has a huge private wealth management business, which is bigger than the global market investment banking business, and for any global bank that wants exposure in this lucrative area, you would think credit suisse would be an attractive asset. matt: i have to ask you about china because every morning it seems like futures are driven by the idea that china may get a little lighter on tech companies, yesterday there was a report that and could revive -- a

pay attention to a fireman on the right, or rather, a block of unguided aircraft missiles, presumably ub-32, peeps out on his treacherous legs for propagandists. the question is what they are doing at a civil facility, and the answer is quite simple . weapons. so in this hangar were far away, not bags of flour or sugar? i will also give a little hug to their peremoga, which the ukrainian side loves so much and which does not correspond to reality. at krasmi claim that they were hit by missiles. snake island in the black sea, where the russian military is stationed, the speaker of the operational headquarters boasted of this lie. the odessa military administration is a kind of bratchuk, but he, of course, lied, without citing, while neither photos nor video evidence, official data indicate the opposite of the russian ministry of defense reported that, of course, vsu made attempts to attack the island, but russian air defense intercepted all missiles. but the figment of the imagination of the hysterical people's deputy of ukraine surname goncharenko in this flight of aircraft, he saw an ai

meantime, ubs does upgrade to buy, says the operational outlook is stronger than ever. about record backlog, two new factories, structural competitive edge and supply chain. they've raised their earnings per share for the next three years by up to 40% >> yeah. you really want to buy this stock after you read this. i think the headline says it all. time to be bold. i think they're making a call that has come down enough. the china news i think is -- it's a verify kags of what we've been hearing but i think this innovative kind of just going away from the path is once again a way to be able to say that ford and gm don't have what it takes that's going to become question once gm has the hummer i do believe that ford f-150 lightning is a challenge but, yeah, i mean, tesla is just doing better than everybody. it is a little aggravating because everybody else is really trying hard, but tesla is just way ahead. david, when i read what -- you know, what the analyst has to say, there is just a thing that china was somehow really favoring these guys. there's no way they could hav

well, ultimately worsen the lives of our citizens ube.t we will endure this pressure and as a result we will become stronger for march june. that is, for less than 4 months on at the national level, the governments of our countries have done a lot to minimize the consequences of this pressure in order to coordinate mutual action on the development of import-substituting products, adaptation of the economy, economies, as changing external conditions, saturation of the consumer market, and the formation of new logistics for the supply of our goods. e, and. e, in. the principle of comprehensive measures to support all sectors, strengthening cooperation has become the main topic of the agenda of the regular session of the parliamentary assembly of the union of russia and belarus, which is taking place these days in minsk. yes, our state is different, but the task of legislators is to make the union feel stronger in everyday life. it is important for us to resolve issues as quickly as possible, and harmonization of legislation, so that our cit

>> well, i was president of the ubs investment bank and ubs america, so i know jamie, and i understand views with respect to the banking industry9 and the future of the economy. i mean, a couple of things. one, i wouldn't say it was rosy today, so i would disagree with him where we are today. we're having, i would say, strong numbers with jobs and wages, and then we're having everyday, tough numbers with inflation both on energy and food. and if you look at everyday, hard working americans, they're losing money in their pocket every day because inflation's about 8.5 and wages are at about 5. so i wouldn't say it's the rosy today. on the horizon i probably am a little more negative with respect to how long inflation will stay with us, because i cothink the geopolitical risk is going to last longer than we all think. and the unfortunate thing with energy is it's a global with market. so it's not just what the u.s. can do, you know? it's what's happening with russia, china and everywhere else. so is i do think we're going to have some serious bumps in the road continue, but i wouldn't say

head of equities for americas at ubs, took the price down from 3900 to 4900 great to see you. >> thanksg me. >> part of this is prompted by the house's downward revision of where they see the ten-year yield ending the year which is now 3.25%. you could walk us through how you get to the 16.5 p.e. that you landed at. >> yeah. sure happy to do that melissa. so yeah, so over the last several years it is been a pretty strong correlation between interest rates and valuation multiples in the market and you know, as we've seen this year, as interest rates have risen and risen quite dramatically, that is an impact on the valuation for the market. so it is really just taking on the higher interest rate expectations and what that means for valuations now, i would say that, melissa, look, we've had a 24% decline in the markets. but i also think it is important to think about the long-term perspective here valuations for the market are now basically in line with the multi decade averages and it does suggest that investors should expect pretty healthy returns from here. 8% to 10% over the next ten y

joining us now is ubs private wealth management's alli mccartney and phil camparelli.you telling your clients right now? i know you're a fan of energy, but energy today not faring too well, down 5.6%. >> look, sara, on a die like this, nothing fares well we have had two really tough days i think the subtle change in what we saw friday and today comes from the fact that we have had a lot of mixed data. it depends on what you're talking to, at what point in time and how you can interpret it the data that we got last week, everything from the lowest consumer index level ever at the university of michigan to something from the cpi that confirmed that the narrative that we hit the peak in march is not in fact the narrative. so everything that has been priced in based on interest rates, based on the expectation of inflation is now undergoing what is the new normal and where are we going to be so this is just a risk off day i'm telling clients to try to just hurry up and wait and understand that this is going to be a long process that took 14 minutes of a lot of money and a l

in the beige book is higher prices at the gas pump are making it harder for people to get jobs like ub but alsoer, the commute cost. -- like uber. but also, the commute cost. jon: always good to get your insight, something a lot to consider. diane swonk of grant thornton joining us on the jobs story. saying -- staying with that, i mentioned tesla. elon musk has told employees he plans to cut 10% of jobs would apply to salary workers. joining us now to talk about the labor pressure on companies is mandeep singh. it has felt like this one to punch for equity investors today. the idea that you have a good jobs report but it is a reminder of what the fed is going to do. in one of the most well-known names in the world shares some comments, or at least the comments come out, which are worrisome to those who are wondering what is good to happen going forward. what was your reaction? mandeep: to me, this is as good of a profit warning coming from a big name like tesla. as your previous guest was mentioning, there is margin pressure across the board. costs are going up. if your top line is dec

to 3900 he said in a downside recession scenario, ubs says the s&p falling to 3300. veteran market expert art cashin says to watch apple and bitcoin. if either breaks, it could lead to a spillout. both are down sharply today. and eric felder wrote we commend the fed for taking a more aggressive stance in tightening financial conditions rapidly as we believe increasing the chances of recession, while unpleasant, will be a more palatable outcome than an extended period of stagflation we are expecting continued elevated volatility as almost all global markets pursue a rapid price discovery process. for more on the sell-off and the fed, let's bring in eric johnston and mike santoli is still with us. eric, you've been bearish for a while now. i don't suppose anything changed after the fed meeting, did it? >> it has not. you know, the fed is right now in a very, very tough predicament. if you think about what is going on right now, the economy is clearly slowing down we saw it today, the philly fed new order number was one of the lowest in the last nine years. it was only

i must say that them son because the government was a pretty good government, was corp between ubs and jewish. it wasn't the fixing the canoe. was a very good ministers, especially in home and 10 in national corporation. and i think that this government, it was very good for the citizens. i just all suggest benjamin netanyahu caught when 60 of the $126.00 grabs in the classes election won't be held until towards the end of october. until then. yeah. like the israel entering privacy and your spectrum engineering senior political analyst now and be sure he says it could signal the end of benjamin netanyahu, his political career, if he doesn't become prime minister again. and that the now is now leaving the biggest block in the israeli connection is really palmer and there is a shout just a chance that he could come back and become prime minister again if he doesn't, that will be the end of his political career. what he's trying to do now is not gotten other elections. what he's trying to do now is with the existing parliament to be able to form our majority because of the defections from

and chipotle would be a name i go back and buy. >> i mentioned because it was reiterated as a buy at ubs the target remains at 2100 >> that's a long way off >> 1958. $1,958.55 is the 52-week high. for let's update everybody on where the markets are, iffy with could right now. we're down about 500 and something on the dow after being down 800 something and now 665 is the current loss on the dow we were again below 3800 on the s&p but we did put in new interday lows for 2022 today for the dow, s&p, nasdaq and nasdaq 100. we're going to have full coverage in overtime three hours from now joining me today erick johnston, liz, among others. imp lkds for enterprise spend along tech especially given what tech has done lately. i hope you'll join me there and we'll see where treasuries ge. y with have an interesting guest on today in "overtime" around treasury etfs ta which is an interesting day to launch new products. whether they're right for your portfolio or not, we'll discuss after the bell >> with this out, especially 35s the fed meeting. this is not a time chase it around >> do you still t

translation: i had been to london ub and i translation: i had been to london pub and i left — translationnd i left to _ translation: i had been to london pub and i left to go _ translation: i had been to london pub and i left to go to _ translation: i had been to london pub and i left to go to caesar- translation: i had been to london pub and i left to go to caesar bar. i and when i got to caesar bar, lots of people started running and screaming and i thought there was a fight outside. so i got out. but then i hear people say "it's a shooting and there is someone shooting with the machine gun." so i wait a little and look over. and my first thought is that someone has been shot at london. it was my first thought. so when it calmed down a bit and i didn't hear more shots, i headed towards london to see if i could help if someone was injured. seeing as i'm health staff, i thought i could contribute. so i got to london and went both inside, outside and upstairs, and there were several injured and there were people already helping out with those who have been shot. abortion clinics are closin

manus: remember at one stage when we talked about ubs being in that lineup. so much the very latest on dws. they have cooperated fully without all regulators and authorities on this matter and will continue to do so. how does risk collect as we go to the end of the hour? bull up or bear down? dani: it has the feeling of a rally running out of steam. u.s. futures running negative in the past 30 minutes. morgan stanley think it is a bear market. up next is "bloomberg markets: europe." this is bloomberg. ♪ another crazy day? of course—you're a cio in 2022. but you're ready. because you've got the next generation in global secure networking from comcast business. with fully integrated security solutions all in one place. so you're covered. on-premise and in the cloud. you can run things the way you want —your team, ours or a mix of both. with the nation's largest ip network. from the most innovative company. bring on today with comcast business. powering possibilities.™ cancer research requires bold and innovative thinking. everyone's experience with cancer matte

was corp between ubs and jewish. it wasn't the fixing. the committee. was a very good minister, especially in man came in is someone corporation. and then i think that this government to was very good for the citizens. i like this whole suggest benjamin netanyahu. quote, when 60 of the $120.00 seats up for grabs in the classes the election won't be held until towards the end of october until then. yeah, la p. israel's entering private israel. i was conducting military drills in massa fietta in the occupied west bank is the 1st ex size in the area since these ready supreme court rejected a passed in an appeal against firing zone that the court decision means that palestinians could be forcibly evicted. you'd abraham reports from my suffer yet southeast of hebron in new york. you fight west bank. these really army has put up these targets here in miss after in preparations for military exercises that are expected to last for one month. this area is called mass asset office and people, i've recently lost an appeal at the israeli supreme court to stay on th

and if ubs it and ukraine tries take, but those searches that russia considered its own, then russia might end up using nuclear weapons, defend them, so definitely willingness to escalate elise in terms of rhetoric for moscow. very much evidence. nick, thank you very much, shar corresponded nick connelly, they're in kremlin chuck ukraine. germany and the netherlands have announced they'll send 6 additional howitzer artillery units to ukraine. that's in addition to the 12 dispatched last week, germany has also trained ukrainian army personnel to use the weapons. a crane has welcomed the delivery though. some say they've come to late. here's a close look at how the new weaponry being deployed on the front lines will work. we make our way through bushes anew. crane's eastern front line in the middle of a patch of woods stands, a howitzer tank from germany. it's the 1st time the ukrainian army has taken journalists here. this ukrainian soldier just returned from germany days ago. for more than a month, he was trained there. the time pressure for the troops is enormous, because the russia

decisive action to remove the irish sea border, so on that basis i do not think it is likely that the ubrandon lewis today has insisted that is not the case, so political discussion and legal wrangling continue, no end to the back and forth here while many people are struggling with the cost of living. a senior software engineer working for google has told the washington post that the company has placed him on administrative leave after he claimed an artificial intelligence chatbot has become a sentient being. a spokesperson for google said that while chatbots can imitate conversation, they are not free thinking sentient beings. so is that the end of the story or is there more to it? i'm joined now by our news reporter, mark lobel. what does this person have to say and what prompted him to speak out?— speak out? has artificial intelligence _ speak out? has artificial intelligence come - speak out? has artificial intelligence come to - speak out? has artificial| intelligence come to life, speak out? has artificial - intelligence come to life, can at any press on it humans is this person i

was corporation between ubs and jewish. it was in the 50 . the commission was a very good minister, especially in home and take a national corporation. and when i think that this government, it was very good for the citizens of his work like this whole suggest. benjamin netanyahu caught when 60 of the $120.00 seats up for grabs in the classes the election won't be held until towards the end of october. until then. yeah, la, p is israel intern products in the dance that supply water to 5 and a half 1000000 people in the mexican city of monterey are about to run dry. and national water commission says more than half the country is experiencing drought shortages are leading to growing public anger as man, while wrapped low reports. there's a water crisis playing out in monte mexico taps across the city have been running dry since the weekend desperate. maria lee said roblis, a local resident has been filling up buckets from a nearby municipal water tank problem. it says it's the only water available for drinking. she also plans to use it for coo

panel may not rise to the level of the crime but still their job to tell the public what misconduct ub happens. i'm then you go over to the justice department. they have been prosecuting cases related to the investigation. basically contempt cases. people have not respond the houses also asked for them to bring contempt charges against mark meadows the ex- white house chief of staff. the justice department is not done that yet. meanwhile the justice department is best in the right itself in yesterday put forward a whole new setwh of charges i got some members of the proud boy, proud boy does cover a lot of people wonder if the court have any charges against donald trump what they are done throughout the post election to try to overturn the election. so far we have not seen strong signs of that out of the white house. whit is unclear if the committee will produce new evidence that will goose the justice department along. >> how important you think the indictments the proud boys indictment and also the oath keepers, how impactful? >> i think they are tremendously important. were looking

was corp between ubs and jewish. it was in the 15, the committee was a very good minister, especially in man 10 in national corporation. and when i think that this government to was very good for the citizens like this whole suggest benjamin netanyahu. quote, when 60 of the $120.00 seats up for grabs in the classes the election won't be held until towards the end of october. until then. yeah, le, pete is israel's entering products oxfam is holding an exhibition in gaza, betraying the impact the 15 years of israel's blockade. off the strip you now said is that she sent us the support 15, sorry, under the hash tag, open up got 15, a campaign that was received by then international for 15 days on social media platforms. the highlights, the impacts of a 15 years. he's very located on every sector like in the gulf stream, the situation for garza, after 15 years, a blockade is wrapped up in numbers. numbers in terms of unemployment number of trade permits, the cannot make the development we have what's happened is that the

they not making tough decisions because they know this government has their back in zurich will be ubsurich will be credit suisse? david: i would hope not, by the way. i'm a believer in free-market capitalism and there should not be any protection. if they cannot do it and someone comes in to make an acquisition to all our parts of the business, i thing that should be allowed to happen. there is talk of someone does bid, they will give ups a chance to give some kind of a deal combination but i would certainly hope that is not the case. >>'s europe even ready for big cross-border bank m&a? david: i don't think you can have cross-border bank m&a in europe on a wild scale until some of the rules and laws are changed. at some point, this may happen but you still have it baking markets which makes it non-conducive to cross-border. i think there is a possibility for some on isolated levels and basis, but at this stage, you still need regulatory evening out that would make it more conducive to cross-border m&a. a company like credit suisse has a huge private wealth management business, which

they are looking at ubs saying that the u.s. economy will start to weaken.alia will look a lot more resilient with the high commodity prices. going along on the aussie dollar, a phenomenal parade. -- going long on the aussie dollar, a phenomenal trade. shery: chinese equities? >> we will see. you can see how analysts are cutting analysts back. a 10% drop. it is starting to stabilize. this is investment management. of backers, equity is looking fairly cheap. it is a lot more government support and we are starting to see further relaxation of covid measures. beijing had the latest with the further relaxation. haidi: let us get to the first word news. i health official saying that -- a health officials think that they may allow a more radiant oil into markets without the revival of the nuclear deal. the biden administration could ease up on the flow of sanctioned oil ahead of the midterm elections. pump prices have shot up to record levels as crude prices have soared more than 50% this year. saudi arabia has raised will prices more than expected for the biggest

that warning putting a lot of pressure on a lot of banking sector including hsbc and ubs and many moretrading lower right now. jeff cuts ler joins you now from london >> good morning to you the mark et is notover ly surprised. this comes on what we saw the first quarter of the year as the ban bank booked in some form of losses the problem is people looked at that as okay, we can understand that they hasslebladthey ha th-- they have not managed to get the escape velocity to get away from some of the slowing trends in the ib business. we got a revenue slow down of more than 50%. and coming into this quarter, the announcement this morning telling us that they don't see those trends turning around at this time. i think that's the reason why we are seeing some infections, and some contagion if you would like for the first quarter people can say well it is about execution and sweat suisse problems. now investors are doing the math and they're saying hang on a second, this means we got slowing activities across the iv sector that reads across to the european banks is suggesting they may also

pay attention to the fireman on the right, he’s supposedly ub-32 missiles. question is what are they doing at the civil facility, and the answer is quite simple. the ukrainian army has long been using shopping malls, school warehouses and kindergartens as firing points and weapons storage bases. so in this hangar there were far from bags of flour or sugar. imaginary victories that the ukrainian side loves so much and which do not correspond to reality. cramias claim that they hit the sun with rockets. snake island in the black sea, where the russian military is stationed, the speakers of the operational headquarters of the odessa military administration, a certain brother, boasted of this lie. well, he, of course, lied, without citing any video evidence. official data suggests otherwise. the russian ministry of defense reported that the vsu, of course, made an attempt to attack island, but air defense intercepted all the missiles, but the figment of the imagination of the hysterical people's deputy of ukraine by the name of goncharenko about this flight of a

ubs analysts say iphone sales were up 13% in china for the month of may as lockdown loosened in the country. it's a different story for the mac. it's affecting the newest mac backs. no specific launch date was given which some people saw as a sign of supply chain problems and the new mc mac book, people noted they put a slower hard drive in there meanwhile, services, less positive in china. analysts seeing slowing growth in the china app store sales this is a similar theme we have seen throughout the pandemic as people get out in the world. there's betting less on apps and gaming estimating just 3% app store growth there in may versus 11% a year ago we'll get the final results from apple itself on july 28th when the report the june quarter earnings back to you guys >> steve, thanks for that. we'll talk more about what the quarter may bring in the weeks to come. >>> still to come, snap looking to diversify its renevue model than your genetic code? that doesn't seem fair. we agree. but where you live determines access to doctors, green spaces and fresh food. that's why we grow our own. smart.

you compare that to ubs, which is many times that, so credit suisse is put in focus at the moment, butit really up to them? tom: tom metcalf, and i believe we will get the sense of getting you back on. francine: gottstein is actually speaking at the conference in rome coming up. tom: coming up, we have the policy for the euro area ahead as the ecb confronts the inflation threat. we will look ahead to gottstein speaking at the rom conference next. this is bloomberg. ♪ francine: come back to the open. 30 minutes into european trading day. the ecb will pave the way today for its first rate hike in a decade to battle inflation. credit suisse seesaws. there are reports of a potential takeover bid that has now been -- and what they want to do in asia. post-covid disruptions ease in asia. tom, we are looking at monetary policy. tom: we see brent above $120 a barrel and restrictions of gas out of -- out of texas. on the china side, their export numbers but further restrictions in shanghai. they have some additional covid cases and restrictions as well in a key diplomatic district in beijing. t

we heard it yesterday the ubs saying buying aussie dollar's is a phenomenal trade.y are calling for a potential high of $.76 u.s. by the end of december. despite all the risk aversion we have seen the occasional dip in the aussie, it is trading pretty flat, just under $.72 u.s. trading against the yen at 94, just shy of 95. the yen falling to a 14 year low, and a new two decade low in the previous session as we continue to watch interest rate differentials with the fed. shery: topping that may low, continues to watch the currency, but look at commodities. we saw the bloomberg commodity spot index rising to another record. it is not surprising because you can see in the second panel how the agriculture energy prices, industrial metals, they have all gone up. we are talking raw materials soaring to fresh records. global commodities index rising 36% this year. oil at a three month high. copper hitting record highs. so much to talk about. do stay with us. this is bloomberg. ♪ shery: as soon as this week. spring and stephen engle. we the market rally, so much rhetoric th

market strategist ubs wealth management.oming up, nato promises to pick up its forces, and can recommit to protecting ukraine. more on the story. ♪ captures imagine of the world. this is the story of ellie morgan, i recommend reading it, she dubbed herself the robert, she called herself the rorschach sheet and when. i can't see -- i think that is one to watch out for. coming up on the programs that would talk about europe and t hi, i'm denise. i've lost over 22 pounds with golo in six months and i've kept it off for over a year. i was skeptical about golo in the beginning because i've tried so many different types of diet products before. i've tried detox, i've tried teas, i've tried all different types of pills, so i was skeptical about anything working because it never did. but look what golo has done. look what it has done. i'm in a size 4 pair of pants. go golo. (soft music) manus: it is "bloomberg daybreak: europe." we have the stories this set your agenda. dani: central bankers unite. they're all telling bloomberg for

but it was, you know, my belief is it was a very, very, 5% to 10% is not a very good, optimist ub p mi optimistic outlook. >> when stepien wasn't telling trum when ewhat he wanted to hear about the election results, he found someone else. isn't this part of the pattern with the former president? >> absolutely, don. the whole story is him over and over and over again, trying to get had one of his former senior officials is talking to me about who is going to be the new white house chief of staff? and trump said i want a but bill stepan is no hero either. he's that whaeks this o he portrays himself on team normal but did donald trump just change radically on november 3rd, 2020? come on, he was preparing and talking about a rig. >> yeah, he's talking about i've been here since the very beginning, since he went down the escalator in 2015. he was talking about a rigged election then. when he won, all of a sudden it wasn't rigged. >> don, can we just say something about the cynicism of all this. >> i respeb him as a campaign person. he's just acknowledged that the president loss and presumab

according to bloomberg economics and ubs, the currency may drop to below 79 or 81 per dollar over thend that is down to the oil prices accelerating. haslinda went through what is going on with oil. you can see the effect of charging more for asian customers. copper futures a little bit lower and iron ore on the way. it is stable generally speaking trade we are seeing some optimism amongst some of the spot prices anyway as we do see the reopening of certain cities including beijing they are in china. and let's get back to what is going on with oil and get to stephen, energy reporter in singapore. now this is an aramco price hike for asian customers. how does then saudi arabia view this market? what are the indications about them seeing demand? i suppose here. stephen: they had decreased prices last month another are increasing, indicating they think things are improving. the focus is primarily on china. we look at the china reopening from the covid zero policy, you see shanghai looking to open up factories again. today you have beijing opening up restaurants for folks. a lot of public

ubs, morgan stanley, deutsche bank, bank of america, the list goes on and on.ng, pantheon, a jp morgan, td securities. just on and on. all these banks looking for three handle. that's the pitch for chinese growth this year. it's changed in the material way. people are looking for something we haven't seen in a long time. >> you are going to have it -- half it to 3%. what is that mean for pacific rim starters pray that's why you see the imf and other institutions start to follow wto with sub 3% global growth. no one including michael has ever thought of. jonathan: a lot of people might consider that global economic recession. tom: there's no question. jonathan: the chief u.s. economist at jp morgan looking ahead to chairman powell tomorrow. pce data, a whole bunch of data this week. this is bloomberg. ♪ so many people are overweight now and asking themselves, "why can't i lose weight?" for most, the reason is insulin resistance, and they don't even know they have it. conventional starvation diets don't address insulin resistance. that's why they don't work. now,

peloton, ubs with cautious comments on the user realities.e economic uncertainty when you have got companies like bed, bath & beyond that come out with challenged sales, perhaps analysts feel justified. ahead of numbers you had seen analysts sharing cautious views. you have the likes of general mills that have had positive numbers, able to price some items higher, deal with the supply chain. but not all companies are in a position to do that. kriti: that uncertainty has a lot to do with the "i" word, inflation, and the "r" of recession. christine lagarde was speaking on how maintaining those the u.s. can avoid inflation. >> while still maintaining a strong labor market, we can do that. there is no guarantee we can do that, it is something that is going to be quite challenging and i would also say the events of the last few months have made it more challenging. jon: let's get some more perspective on those comments. michelle meyer, chief economic director of mastercard. it seems chair powell wanted to stay with the narrative that would be supp

this is an historic moment and i don't want you to speak for ubs and the politics of switzerland but expect the unexpected. we are seeing shifts here of one example of a national bank with shares of apple going to parity moments ago on euro-swiss. these tectonic forces are extraordinary. how do you fold them into an equity belief? >> i think you are seeing interest rate volatility mainly. that was the issue coming into the year. the policy regime shift was going to create the macro volatility in equities in the vix averaging over 26 for the year. to me, i'm not sure where homebase is. fx has been volatile so it's hard to have a view on risk assets. tom: you lose money. do you assume you lose money given what you just said about volatility? >> i don't think so but you assume your risk-adjusted returns are structurally lower than they have been the last few years. it has institutional investors reducing the size of their positions and takes down look entity and that creates more volatility which portends weaker risk-adjusted returns. i don't think you assume you lose money on a nominal

have a look at the forecast, they think 3% for ubs, .5% up 3%.s a very small portion of chinese growth this year. >> let's bring in the chief economist to talk more about this. it seems that china is still using the old playbook to support wrote. is -- growth. is infrastructure the way to build out of the slowdown? >> no, they cannot. the key characteristic of the cycle is that the last two decades, the playbook is not working. the traction from the old playbook, just lower lending requirements, the ratios, put liquidity into the system, boom there goes lots of new construction and the economy turns around. it is not happening, the overhang of the property market is way too large, the gap between lenders and borrowers is added to functional -- dysfunctional low. the playbook is not working. >> however the whole region is facing a slowdown, and china's not at the top of the risk to this part of the world. that brings us to what is. shirley expending is going to help, not hinder. >> sure, a ton of slowdown is such a domestic story, is not taking a

ubs out. take a listen to a few of these. alphabet price target cut from 63 sorry from 3600 down to 2650 ubsarguing they see risk to margins and youtube numbers. twitter is exposed to a lot more than ad pull backs >> looking forward to anything that comes out of that going back to alphabet they say google is well positioned they call out what they say conspicuous investment plans as a risk to margins. pointing out that $9.5 billion investment that alphabet has planned in u.s. offices and infrast infrastructure he said those are on track they are still committed to that but they would remap numbable. >> it takes us back to when moon shot spending was seen as irresponsible and found a new discipline it would be material if they had a long term adjustment to their investment plans given the strength and siefz their balance sh sheet. >> sure. >> the trend in crypto is clearly not positive topped out long time ago i was with you in july of last year and bit coin was up like 60,000 or something. then it dropped down to 30%. it keep

going to the ub many are cutting back. going to the pub left. — many are cutting back. many are cutting back. going to the pub left, just having a i many are cutting back. going to the pub left, just having a few l the pub left, just having a few cans at home instead.- the pub left, just having a few cans at home instead. when you ut the cans at home instead. when you put the arm _ cans at home instead. when you put the arm and _ cans at home instead. when you put the arm and on, _ cans at home instead. when you put the arm and on, you - cans at home instead. when you put the arm and on, you put i put the arm and on, you put several_ put the arm and on, you put several things on at the same time — several things on at the same time. ., ., ., , time. you have to, in this climate — time. you have to, in this climate in _ time. you have to, in this climate in this _ time. you have to, in this climate in this situation. l time. you have to, in this. climate in this situation. at least climate in this situation. least the park is free, you just have to get there. i paid £1 9

is probably more evaluation. 80% off their highss is enough >> i'm thinking about the ebay call, the ubs cuts to neutral, from 60 to 48. they are down 17 for the year, street is down 15/16, something like that. >> it's an interesting opportunity. we talk about ecommerce companies. a lot have different models. some are stores. you look at shopify between 300 and 400 for the fast few months. it is different, creating the small business medium marketplace versus an etsy there are questions about their fees that get paid here. how the stores themselves get squeezed, what is investors make moves on here remember wal-mart with bonnobo, they may be right for the picking, carl. >> that goes back a few years. we go to break, get a check on qualcomm bofa represents the best buy-rated ideas. stongs down 30% for the year this morning [music - cover of blondie's “dreaming”] [music playing] ♪ dreaming. ♪ ♪ dreaming is free. ♪ >>> after a very calm day yesterday, markets moving this morning rather quickly s&p now down 1%. nasdaq down 1 and three-quarters percent. carl, we'll see where this goes the res

we would be reluctant to cut >> let's talk about this and more with kiran ganesh at ubs. kiran, welcome to the program. what does it mean to you when the fed chair says we can't fail can we define failure here when it comes to the fed? >> if we look at the fed mandate, they have two things to fail on. inflation and unemployment that's where they are in a bind. it is harder to get inflation down for the fed to come out a winner is a difficult situation i think it is interesting to see the market movement in light of the comments we have started to see maybe some expectation of earnings coming down. we have seen bond yields falling as well. that is the importance with the support of the markets the past few days >> is the market here and uk and europe going down this year? are the markets pricing in a soft landing or a hard landing because if it is a hard landing and we get a soft landing, that should be good for stocks and if the opposite is true, that should be bad. >> right think at the moment we are pricing in a soft landing. flat earnings next year and bond yields sayi

louis in europe with ubs looking for a 3.5% offense fund rate. pricing at 3.5%. that is a big deal.ptimism. lisa: this is coming away from that 4% fed funds rate people were looking for. andrew from citigroup reiterated yesterday how much to see people easing off of their expectations for how far the federal applico. tom: two year yield yanks back. up seven basis points. 10 year yield, 3.11. this is an immense joy right now. shahab jalinoos is global head of affect strategy at credit suisse and joins us this morning. i want to go to the magnitude of your calls. i want to go weak in well out past 140 -- i want to go weak yen will let past 140. strong euro swissie. why do we get these magnitude of moves in foreign exchange? shahab: we are seeing the end of central banks using balance sheets to manipulate where fx rates trade. you are seeing fx rates react to that. japan is trying to stay the course as long as possible. that is what we are seeing reflected. tom: is it a big enough shift coming off of balance sheets dynamics after world war ii? shahab: it does not need to be as big as t

there's about 10 of us now ubs is involved and jump street trading and susquehanna.mission ticket, and every day we're banging heads with citadel securities to provide the best service and the best price to 250 clients and some days we lose and some days we win >> we'll see if this goes anywhere, doug cifu virtu ceo, the key point is when i started with cnbc in 1990 it was not unusual for the trade to cost 9% when you engaged in the actual trade itself and compared to today when you're still dealing with zero dollar commissions the question is exactly how much does it cost for payment for order flow whatever that cost is, it's a tiny fraction of what it was more than 30 years ago so there is something to the idea that the retail investor has never gotten it better, but with that said, maybe we should still have more competition out there. >> the debate is feeding a frenzy thanks for bringing us that important interview. our doug pisani with cifu. mortgage demands are pushed to levels not seen in two decades are we about to see a flood of properties come tthmaono e rk