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europe. these are the stories that set your agenda. loretta mester wants to see more debtor. governor bowman warms -- warns that progress on inflation may have stalled. the boe governor says that u.k. is facing less inflation risk than the u.s., opening up the prospect of cutting rates before the fed. tsmc, the world's biggest semiconductor maker, set to report earnings this hour a day after disappointment from asml. nokia dropping right now. the telecom equipment maker of course. we will bring you those lines with a focus on sales. first quarter net sales coming in below the estimates for nokia. 4.6 7 billion euros. essentially 4.7 billion euros. below the estimates of 5 billion euros.

here's the redhead now for nokia. they still see their full-year adjusted operating profit up to 2.9 billion. they are holding their view in terms of full-year adjusted operating profit. we know there has been pretty solid weakness around the demand, particularly for 5g telecom. that has been a challenge for both nokia and ericsson. we continue to look for date -- look for details around the patent dispute as well. they are maintaining their full-year operating profit forecast despite that challenging environment. telco spending has been softer than many in the space have hoped. let's check the markets more broadly. on a day where we look at a -- u.s. futures pointing in the green. we've seen that reversal before. four straight days of losses across u.s. stocks. today, futures pointing higher

as investors continue to grapple with the debate around just how long these rates will held -- behold higher as we continue to feed and the commentary from fed officials. sp gains, three tens of 1%. you are 4% below now on the s&p. the ftse 100. two tons of 1%. the boe governor seeming to be a relatively -- seeming to be relatively relaxed. big selloff from the mega cap tech stocks yesterday. nvidia dropping as well and weighing on the nasdaq. let's flip the board and lacrosse asset. we've been seeing yields dropping about eight basis points on the benchmark 10 year. a little bit of money continuing to move in.

yields down under to basis points. the bloomberg dollar index softer as well. the intervention story is in focus for us as well today. i put a question around that but nonetheless the bloomberg dollar index is off by 1/10 of 1%. brent, given the geopolitics and sanctions coming through, $87 per barrel. just up to tens of 1%. inventories in focus as well. let's cross over to asia. april hong is standing by in singapore for a check on the markets. >> we are looking at a sense of calm returning to asian markets. whether you are talking about stocks, bonds, or currencies. this is thanks to verbal intervention helping to boost confidence in financial markets in the region. i will dig into the details further. we can see also how the asia

stock age is snapping a succession losing streak today. headed for its best day in a month. in south korea and australia, we are seeing the materials index, the stocks outperforming. this is against the backdrop of the u.s. president calling for higher tariffs and aluminum. really the sector we are focusing on is the chip related stocks as earnings come out later today. we are watching out for the plans from the world's largest chip foundry at a time where the u.s. chip gauge as well as nvidia have fallen into correction. there's a sense of how tmm c could potentially boost the south korean and taiwanese stock benchmarks. of course the tech rich gauges. mark renfield has pointed out that back in january when the quarterly earnings dropped, that coincided with a bullish turning

point for the indices. let's take a look at how currencies are faring today. a sense of calm is returning. the reprieve thanks to job hunting. we got pboc coming through with a statement on we chat that is trying to prevent the risk of overshooting from the exchange rate. you have to wonder how long this is going to last, especially with the fed narrative and play. higher u.s. yields potentially as well as a supportive greenback. tom: april hong in singapore. we unpacked that part of the story in more detail now. a survey suggesting that the u.s. economy has expanded slightly since late february. firms reporting great difficulty in passing on higher costs. the fed governor meanwhile saying that progress on inflation has slowed. perhaps even stalled. >> what we've seen over the past

first few months of 2024 anyway is that progress and inflation has slowed. i expect maybe it has even stalled at this point. tom: let's get the market reaction to the commentary we are getting from these fed officials. we have clarity on where the fed is and how the markets are thinking about the sequencing going forward? >> we know from not only michelle bauman and loretta mester that there's going to be a delay of cuts. also what we heard from jerome powell this week solidified that. the fact that the fed is likely to be delayed. that they had three months of data showing that there was a pullback in inflation in terms of, there wasn't that much progress on inflation is much as they had expected. undoing what we saw at the start -- at the end of last year.

now the fed has to wait for another trend that's going to come through to show that there's disinflationary pressures coming. at the end of the day, they are going to have to delay the start of their easing cycle. so higher for longer persists and dollar strength as a result also persists. tom: the diversions we are getting on the rhetorical front has been quite stark in the past few days. what do we know in terms of the health of the u.s. economy? the 12 districts a look at, where does that lead our understanding of our u.s. economy? >> is quite exceptional that we see u.s. data one after the other continuing to prove u.s. and sectional lists -- u.s. exceptionalism. that coupled with weight -- rate differentials and comments from andrew bailey, the fact that the ecb is likely to start cutting

as soon as you. there is that divergence, whether it's on rates or growth. that's going to keep the dollar supported. so yes you could have some sort of a reprieve. you could have some sort of resistance especially with some of the comments coming out from the finance ministers and the jawboning that we've seen. at the end of the day, the underlying narrative remains. that's that u.s. gross -- growth remains exceptional. rate differentials continue to widen in favor of the dollar. it's hard to see where the dollar decline is coming through. tom: u.s. exceptionalism being crystallized it seems. we will be hearing from fed speakers and what that tells us about the state of the u.s., -- economy and where the fed goes next. the geopolitics now. u.s. house speaker mike johnson

is moving ahead with new assistance for both ukraine and israel. that's despite threats from republican hardliners to oust him. let's bring in bruce einhorn for the details. what is speaker johnson's plan to get this aid package past? how likely is it? what's the resistance he's facing? >> well, this has been several months in the works. the senate passed a package of $95 billion in aid to ukraine, taiwan, israel back in february. since then, the house hasn't done anything. we now know that speaker johnson is planning several votes that would be this weekend that would divide the senates package into different votes.

there would be one foot for ukraine eight. there would be one for israel. there would be one for taiwan. the thinking is that by splitting it up like this, speaker johnson can get them all through. the ukraine aid by having one vote on that. you would get more democrats even though he would lose republicans who are opposed to it. with the israel vote, he would get more republicans. he would lose democrats who want to impose conditions on aid to israel. the taiwan one would sail through without opposition from either side. there's pretty bipartisan agreement on the taiwan part of it. the speaker also is planning including one more phone that would impose further costs on russia that would include seizing assets of russia in order to defray the costs of the package. if all goes well, this would all happen this weekend. still a lot that could go wrong now between now and then. tom: yes. some potential pitfalls in line

for this bill in the days ahead. ukraine has been screaming out for aid. why is it taking so long? >> well there's been this long delay. president biden initially proposed this back in october last year. there was republican opposition that quickly got together and effectively stalled everything because republicans said that they couldn't pass any sort of a package without first addressing what they called the crisis at the southern border. there was a bipartisan deal that senators worked out on that. that ended up collapsing after opposition from former president trump as well as johnson. since then, we've been in a stalemate position. another thing that's figure johnson has to consider is that there's a rule in the house that all it takes is one person to propose a motion to vacate the chair.

there have been republicans who have threatened to do that. most recently marjorie taylor greene has said that she wants to have a vote to vacate the chair to get rid of speaker johnson. another republican from kentucky has said that he would support that. all they now need is one more because the republican majority is so small in the house that speaker johnson can't afford to lose another vote if one more republican says that if this aid package vote goes through, they will vote to get rid of him. then speaker johnson would depend on democrats to keep his job. so a lot of different factors in play. one other thing to keep in mind is, in addition to all of this, johnson has said there will be a vote from the house that would condition some of this aid on a tiktok bill that would force bytedance to sell tiktok in the u.s.. that is something that the house had already voted on.

the senate has not voted. if that were to be in the package, that could slow things down a lot. tom: thank you very much indeed. we will continue to watch to see if they can get the bill across the line. they can for the update. let's give you clarity on what's coming up today. some of the big topic send agenda items to focus in on. we get new car registrations out of the eu, the tony seven men members of the european union. a little bit of detail in terms of the demand coming through for the auto market. lower yellow cells as well. within the retail luxury space, that could be interesting. 5:00 p.m. u.k. time. u.s. earnings. netflix and blackstone as well. two very different businesses coming through with their earnings story later today. you can get around up of the stories you need to get your day going in today's edition of daybreak. terminal subscribers can go online to check that out. top items so far today.

tiktok. bruce was talking about this. the potential divestiture story as it gets tied into the bill for aid around ukraine and israel. tiktok and the forgers of the owner and focus. further commentary on the state of the u.s. economy and expectations around rate cuts expected. and then ubs, one of the top corporate stories of the day for us. more than 100 job cap -- job cuts. ubs said to be planning another round of job cuts. sources telling bloomberg it is expected to affect the global investment bake the coming weeks. cuts also expected in his wealth management and markets unit. the ceo of the company has not detailed exactly how many job cuts will be coming through but has said they are looking for $6 billion worth of cost savings. we keep across that story for you.

sanctions on a rainy and oil. more details on that next and what israel is inking about a potential response to that attack. this is bloomberg. ♪

tom: welcome back to bloomberg daybreak europe. u.s. house republicans have included new sanctions on a rainy and oil in a wider foreign aid package for israel and ukraine as we were discussing before the break. joining us now for the analysis on the uranium component for the story is patrick sykes. thank you for joining us. it wasn't that long ago that u.s. enforcement efforts around a rainy and sanctions were easing off a bit because they wanted to get more oil in the market and they wanted inflation

down. what are the details around these proposals in this package? what could the consequences be? >> i think it's interesting actually. introducing the sanctions and enforcing them may be two different dynamics. there's a scenario where they could pass the sanctions and send the message that we are trying to restrict iran's oil revenue as a measure of support to israel. meanwhile, not actually enforce it that strongly in the way you described. therefore keep oil flowing, keep prices as best they can relatively muted. one of few measures that we've seen overnight. whether the movement on sanctions seems to be expand them. oil was one in the eu as well. we saw some g7 countries apparently considering sanctions on iran's national airline. that also seems particularly

symbolic to me. but we are seeing the scope widen from the initial drone missile program that followed the attack which was very direct to the nature of it. to iran's interests more broadly. tom: meanwhile, the extreme suffering of people in gaza continues. the u.n. looking at attempt to alleviate that. what are the details there? >> around 2.5 billion. that's a big number. it's a 10 times increase of what they were seeking six months ago at the start of the war. but it is still short of the 5 billion they were seeking in total. they are also making very clear that what they can actually deliver is very limited by the operational constraints on the ground. i think to have a real substantive impact, you've not only got to overcome the current hurdles of getting aid in, getting those backlogs cleared,

and distributing it once you are inside gaza. more broadly, distributing in a war zone is an operational nightmare. it's only really a cease-fire if it is going to see those increasingly high numbers translate into proportionally effective humanitarian responses. tom: yeah. israel continuing to face criticism from a number of different parties. international aid groups and leaders around the world for what they described as the holdups of israel around some of the eight. israel pushes back on that narrative. nonetheless the critique is there. thank you very much indeed on the latest in terms of trying to get that aid into gaza and the potential a and sanctions as well for that into the package that's working its way through the u.s. senate as we speak. coming up, zimbabwe's sixth attempt at establishing a functioning local currency after years of hyperinflation.

we hear exclusively from the countries finance minister. we pivot to a fascinating story around zimbabwe and the change around the currency. the conversation is next. stay with us. this is bloomberg. ♪

tom: welcome back to bloomberg daybreak: europe. sin bob ways finance minister says the country's new currency backed by foreign reserves is an important milestone for the country. he spoke to us exclusively about house and bob way gold can face down those inflationary pressures. >> we've all thought the center was going to move and cut interest rates. but they haven't. that's the way it is. inflation risk in the u.s.. you are right.

it puts pressure on currencies around the world. but ours is linked to gold. there's always deflationary risk out there. we are aligned to that. we don't see that being an issue. for us, the quest has been to restore stability and contain inflation. so maybe a bit of deflation is not a bad idea as a way of re-incurring expectations on price movement into the future. >> could you give us an update about your efforts to resolve that situation? the $6.7 billion in areas that zimbabwe does oh to outsiders. >> an albatross around the economy that could be growing faster. 6.8% on average over the last three years. imagine if we didn't have the albatross. that could be higher.

averaging 8%. we are working with the creditors in the first place. the 17 paris club creditors. also bilateral clear editors with world bank. we have a high-level facilitator. the former president of mozambique. they are helping us to close the gap between zimbabwe as a debtor with the creditors. >> why was this currency introduced via a statutory instrument? i guess you could say it's a legal instrument like a subsidiary law. it's not a bull that went through parliament that was approved by lawmakers. why not introduce the currency by introducing a bull to parliament, let lawmakers debate it? >> imagine you have currency

volatility. then we are having this long debate in parliament about currencies and so forth. you could never do it like that. the way to do it is the way we did it. we need an instrument that allows you to do things quickly, efficiency without revealing too much information including how the currency is price. there's a clever way to do it. once that's done, the currency is introduced. you go back to parliament through a normal bill in our case. this is a better way to do it. tom: that was zimbabwe's finance minister in washington on the new currency. let's check in on these markets. commodities getting lift this morning. oil reversing but only at the

margins today. gold continuing to get a lift. up 6/10 of 1%. the hedging mechanism, the hedge that it provides will stem appetite there. european futures are looking flat. currently gains of 1/10 of 1%. still ahead, we are counting down to the tsmc results. what it tells us about the demand for ai chips. will they see the pickup that many expect? those numbers except at the cross in the next few minutes. stay with us. stay with us. this is b

all of the work that we're doing, all over the world, and looks at the most effective ways, to get resources to them, to get services to them. the idea that we have saved five million people's lives, it's overwhelming. it's everything. ♪ tom: good morning, this is

bloomberg. rush to cut, a delay to rate cuts. beretta messner wants more data and bowman warns progress on inflation has stalled. the u.k. is facing inflation risk, but less than the u.s., opening the prospect of cutting rates before the fed. chips in focus. i will bring you the top lines. first quarter net income coming in with a beat. 225 point 5 billion taiwanese dollars, estimates for 214. gross margin coming in above estimates. 53.1%. in terms of gross margin, we asked is crucial for the analyst. we look for the details on that.

quarterly profit of 6.9, 7 billion u.s. dollars. fx conversion, beat on estimates. gross margin higher. the smartphone part of the business is cloudy, but ai demand lifted results. more details for apple and nvidia. capex reaching 5.7 billion u.s. dollars in the first quarter. the latest estimates that had been around $29 billion. you could see a lift to the stock, capex coming in at 5.7 billion u.s. dollars. net income in the first quarter beating estimates. we look ahead to the forecast to

see if they can adjust it, that tells us so much about demand for customers. he lines for tsmc, it is a major story. asml dragging with softer demand for ultra violent -- violet and ai demand is lifting the company for now as smartphones look murky. four straight days of losses. futures turning around. suggesting upside for the u.s. markets, that is the narrative we have seen adjusted toward the middle of the day. modest gains of 1/10 of a percent. s&p below 5000, gains after four

straight days of losses and nvidia weighed on the nasdaq. gains of 89 points, flip the board cross asset. we saw a beat for treasuries after a selloff in the last few days. yields coming down on the benchmark. an additional two basis points, 456. bloomberg dollar index look softer. reprieve in the session. intervention story in focus, bloomberg dollar is down. after a drop of 3% yesterday, u.s. inventory is back to levels we haven't seen since june. up, let's get details on fx. yen against the dollar, joint statement noting serious concerns about depreciation of

major currencies. buds bring in mark cranfield on what is the message to traders from g7. was janet giving them the greenlight to intervene in their currencies? mark: if you're telling traders your time is running out, wonderful trend we have been seeing for several months were dollar strength affects everything, not just major currencies were asian currencies. dollar on a tear. support is high with strong dater out of the u.s.. several countries are uncomfortable. we had a rare joint statement from janet yellen and finance ministers acknowledging people are getting concerned about weakness so it doesn't mean to

say the u.s. will support intervention directly, but if you want to go ahead and give your currency specific support, we will not get in the way and you have are greenlight. does not mean it will happen immediately, but we are getting closer to the point where the currencies are falling and their respective countries, particularly south korea and japan, but other places. asia, latin america, the euro, these currencies have fallen a long way and it's about time for some stability. first morning shock. bit of a pullback. further to go in terms of what it means globally, giving a lift to asian equities, you will see a decent day because risks code, down and people can go back to

the data. tom: rate differential remains extreme in terms of fed and boj, they challenge to intervention. talk about fed rate pricing given commentary that inflation may have stalled. mark: mixed messages, jerome powell said he is in no rush. fed members said the same thing. the bubble has indicated they can take their time. dater supports jobs growth strong as well. inflation is too high. everything points to the fact that the data is telling the fed you can't take it too quickly. last thing they would want to do is get into a position where they did an early rate cut and then they had to unwind because inflation is major. better to see how the data holds

out. what that means for risk assets, u.s. market is in a range, yields do not go outside first quarter numbers. probably supportive of equity market and then you've got the u.s. dollar affected by the flip side, bank of japan next week, a big one. consensus and the pole is bank of japan will not change interest rates. risk of surprise because the governor has repeated that the yen plays into the inflation picture in japan and is too weak. he might want to respond and show he is on top of that as well. tom: valuable analysis mark. thank you very much indeed. going back to corporate earnings, tsmc reporting a beat

on first quarter net income and a profit rise. the first in a year. but spring in bloomberg intelligence analyst. robert is standing by in hong kong. what stands out to you? robert: thank you for the intro. you have run a numbers so basically a decent beat at the income level, 1% operating level. that will give them market encouragement, returning to growth after a difficult 2023. however there are potential? so on the horizon. viewers wonder the weakness apple is seeing within china. apple accounts for 20 or 25% of revenue.

from an asian perspective we saw asml results. intake was weak, no impact on tsmc but it raises a question about demand into the tale of this year and 2025. the key thing with stock is what is to come. we are here on the call later on and guidance for next quarter and the year, we will have to wait and see what the management is saying. tom: you are pushing out to 2025. it was a quick view of how the

rest of the year is shaping up. robert: apologies for the answer but it is ai and nvidia mixed in. near-term outlook looks good, but taking a step back, 14% comes from automotive sector. >> on eeev's. smartphones i've mentioned apple so there are questions there. if are going to see upside, upside needs to outweigh weakness. we had an earthquake and loss of life was minimal but there is a question andto see with the management has to say. robert lee with the quick fire. a take on the earnings from tsmc.

thank you. ♪ stay with us. this is bloomberg. ♪♪

♪ tom: welcome back to bloomberg. europe is watching as industrial policy threatens to leave the continent behind, that is the backdrop for the eu meeting in brussels. they face tough decisions on keeping the region competitive. will they move to policy? oliver crook is standing on the sidelines. alarm bells ringing in european capital. leaders wringing their hands, what have you been hearing? oliver: alarm bells are ringing and it is easier to impose tariffs that deal with competitiveness, but the mirror you need to decide what does

europe need to do to compete with the u.s. and and if you think you're done hearing from mario, you are wrong, he is one of the authors tried to illustrate how europe needs to stay competitive. we should hear it from him. >> china is aiming to internalize all parts of the supply chain in advanced technologies. the u.s. are using large-scale policy to attract high-value domestic manufacturing capacity and we are lacking strategy to keep pace in a cutthroat race. we have to act as a union in a

way we never have before. so it takes radical change. he closed by saying there needs to be a reimagining of europe on the same scale as the founding of unions 70 years ago and for europe is the kind of thing they are bad at. difficult political negotiations and the urgency is not today, it is long-term obsolescence of the economy. tom: what are the measures to address issues highlighted. >> he is one of the authors of the report, the other is a warmer prime minister who made a detailed report about the market's future highlighting things that need to happen.

stronger energy union with consolidation in the telecom sector. there are 32 companies across europe and the u.s.. this creates efficiencies within the market and we've heard about this for a decade. does the need for investment give us the impetus to get rules in place in political initiative to get capital flowing and defense spending and potentially the question of joint debt, where will the money come from, their banking on these things. all this means europe that acts more like a nation ahead of an election where skepticism is on the rise. >> monumental challenges facing the eu. policy prescriptions in focus. ali, thank you with the details in terms of the leaders meeting, covering that throughout the day. berkshire hathaway priced more

than ¥260 billion of bonds, it's the largest debt deal since 2019 when it began sales in the japanese currency. let's get more from asia credit reporter i.s.. why is this deal important and what was the focus? >> thank you. it was one of the most focus deals in japan because it is one of the first and biggest deals from a foreign issuance or since japan ended the negative guilt policy last month. it was focused and also how much it can attract demand from investors will be interesting because warren buffett has a history of investing in japanese

stocks and especially major japanese trading houses. so it has implications to the stock market as well. tom: burke shire is an issuer of bonds. why would the u.s. company raise bonds in the japanese currency? >> non-japanese companies would raise the end bonds, they have different reasons. but for burke shire, it bought trading houses, shares in the past and it is said that it wants to buy up to 9.9 percent of trading company stocks, so still room to buy more. people are expecting the company will buy japanese stocks and

warren buffett said he likes value shares on values stocks could include other sectors like financials and insurance companies so their stock prices rose. >> that is where they will get the funds in equities. what implication does this have in other asset classes? >> credit market of course, foreign issuers have been able to raise yen so they're looking

for attractive deals, but for the stock market warren buffett has helped the equity market to rise this year. people are expecting that, it has a significant impact in the equities market as well. tom: bloomberg's asia credit reporter with that detail in japan, thank you. now for other stories, micron is poised to get 6.1 u.s. billion dollars to pay for domestic

projects. micron excepts loans. the plan is a part of u.s. efforts to bring semi conductor production to american soil. bloomberg understands microsoft's investment in openai is set to avoid a formal investigation by merger watchdogs. the commission decided it does not merit a probe because it bullish short of takeover and microsoft does not control direction of the ai company. the owner of the royal mail rejected a cash bid from daniel because it undervalues the company shares in international distribution services. remained well below the offer price. they say the approach does not reflect prospects under the new

management team. plenty more, we will focus on inflation and give you detailed around the oil space as well. this is bloomberg. ♪

♪ >> what we've seen over the first few months of 2024 is progress on inflation has slowed down and i expect maybe it has even stalled. we are seeing the process of disinflation. share prices have dropped because unique energy household pricing system in the u.k..

tom: that is one of the most interesting pieces of rhetoric over the last week and it is backed by the data. we are seeing a divergence on the relatively benign picture around u.k. inflation versus u.s. inflation. christine lagarde also suggesting she is comfortable, not pushing back on the idea that june is baked in on the first cut. here is what is happening, progress being made given the run-up during the pandemic, where it stalls out, i want to zero in on the yellow line of u.s. inflation versus headline inflation versus the white lines of the u.k. and light blue of eurozone and you can see divergence. headline the u.s. inflation edging higher, u.k. edging blower three point 2% above forecast yesterday marginally. does not seem like andrew bailey

is concerned, but 3.5% and the fact that it seems to have stalled. below targets for the central bank on all of these, but you can see divergence in terms of headline numbers feeding into what we're hearing, let's have a look at oil because the energy component is in the mix in terms of inflation, looking at nine with inventories building up highest level since june. relationship between inventories and prices playing out with a 3% drop. markets today is next, this isob

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♪ >> good morning, welcome. a lot to talk about. great keying news on whether earningsar