Bloomberg Break of day: Center East & Africa 03/28/2024

This is Bloomberg Daybreak, Middle Eastand Africa. Our top stories this morning.Treasury yields rise after Fed Governor Chris Waller says there's no rush to cutinterest rates while inflation remains a problem.Ready to act? Japan's policymakers warn currencytraders that they're standing by to stem the slide in the yen.Plus, Israel agrees to reschedule a canceled visit to Washington to discusspossible military operations in Rafah. It's just gone 8 a.m.across the Emirates. I'm Vonnie Quinn in Dubai.We are pretty picky this Thursday, and.

It is the last trading day of the monthand the quarter for most developed markets.So let's get into it and see where we are headed.Futures wise, it looks like it might be lower.This, of course, comes in the wake of Chris Waller's comments to the effectthat literally there is no rush. He gave a speech in New York Wednesdayevening, US time entitled There Is No Rush, and suggesting that he needs tosee at least a couple of months more inflation data in order to becomfortable agreeing with starting to cut rates.Well, that also started to help Treasury.

Sell off and we are up a couple of basispoints here on the two year yield at four 6055.And then with Brent crude, we are seeing it hold in around the $86 a $0.30 mark.I do want to point out this chart, though, because we are at the end of thequarter, it's also the end of the fiscal year in Japan.So we'll be talking about that in a little bit.But have a look at this. Global stocks have risen for the secondstraight quarter as bonds slide that blue box there.It's the old country world index now in that Japan has done the best, followedinterestingly by the euro Stoxx 50 and.

Then the S&P 500 and of course thepurple is our dollar spot index. And as we know, that's beenstrengthening as the Fed has been putting off its cutting cycle.Let's check in now on how markets in Asia are faring and that yen inparticular. April Hong is in our Singapore studio.April it's. Yeah.Vonnie, we are focusing on the yen, but let's take you through what we're seeingin Asia Pacific stocks first, because we didn't get those hawkish comments fromthe fed Governor Christopher wall. So far, investors here seem to be takingthings in their stride as we see the AIG.

Theme coming through.It's those tech rich indices that are climbing except the Nikkei.And we seeing Hon. Hai, the Taiwanese iPhone maker.That also makes I suppose that is surging to a record today.We've seen it doing well in the past month after really strong quarterlyearnings and a number of brokerages have upgraded its price target.So it's helping to lift not just the Taiwan stock benchmark, but helping tocap those declines on the MSCI Asia Pacific.Let's take you to Japan, where the Nikkei really is a laggard in thesestocks space today.

And this is some timing involved in thisbecause yesterday was the last trading day before companies win.Ex-dividend today, there's some profit taking underway.But note how even though we're seeing this pullback, it did close at near therecord high yesterday on the yen. We're seeing it move roughly at that151.4 level. It's steadying after hitting 34 yearlows. Yesterday.We did get the DOJ summary of opinions from its meeting this month, and they'readvocating a cautious approach when it comes to rate increases.Funny.

April, thank you so much.We'll be back with you in just a little bit.That's April Hong there in Singapore. We're keeping a close eye on the yen.Meanwhile, Federal Reserve Governor Christopher Waller says the central bankshould delay or reduce the number of rate cuts seen this year.He called the recent inflation figures disappointing and said he wants to seeat least a couple of months of better data on that front before cutting.Policymakers have pencilled in three rate reductions still for 2024, butWaller says a strong U.S. economy and robust hiring have given theFed room to wait.

In my view, it is appropriate to reducethe overall number of rate cuts. Or push them further into the future.In response to the recent data, I see no rush in taking the step of beginning toease monetary policy. Let's bring in Diana Masina, deputychief economist at AMP. Diana, thank you so much for joining.There was speculation that it was Wahler that moved his doors in the summary ofeconomic projections such that now it's maybe more likely that we'll see twocuts rather than three this year. Is this confirmation of that fact, doyou think? Well, the last few weeks of data, Ithink, would suggest that there probably.

Isn't really a need right now for theFed to rush into rate cuts. The growth environment is still holdingup and inflation's trending down. So unless you get a change in the growthdynamics at the moment, you see a much further weakening in the labor market orquite a fast slowing in the consumer sector.I think the Fed probably does have room to wait just to get extra confirmationthat inflation's heading down, particularly for the services sector.So what you really want to see is softer wages growth from here.He made it sound a little more urgent than that, though.Missing a DNA.

He made it sound like it might be adangerous thing, actually, to start the cutting cycle.Will we see the rates market price out a June cut today?Well, it's interesting because he definitely sounded quite different inhis rhetoric to what Powell sounded like in his testimony, because to me, Powellsounded like a central bank governor that was ready to start cutting.So, I mean, we have to remember that this is a board decision.Waller and Powell are not the only ones that make this decision.It is one that decided by the whole board.So we can't just take comments from one.

Person as what the whole Federal Reserveis going to do. I mean, I think it will impact marketpricing, though, because we've seen over the past few months this shift towardspushing out those rate cuts later into the second half of this year.So we may see that happening again. But I don't think that what thosecomments override what what Powell was saying just a few weeks ago, which to meseemed like a central bank that was getting ready to start.And let's not forget also that other central banks, like in Sweden or inCanada, are looking like they're ready to start cutting interest rates soon.I mean, that could be a sign for the Fed.

That it's time to move into that easingcycle as well, Possibly for sure.But I think it's fair to say that Wall has been one of the more importantvoices, at least in the last year to 18 months.Right. I mean, you know, as a Fed governor, youtypically don't hear that much from somebody.But Waller has definitely been out there front and center.I do want to ask you about today's confidence data and tomorrow's data.Will we get any surprises? Well, the PC data has been coming inbelow the Fed's own expectations in the.

Past few months.And the CPI, I think, is mostly in line with PTA that's trending towards that 2%range for the federal inflation target. So I don't really think that we're goingto see too many surprises given that we've already had the monthly inflationdata in terms of the Consumer price index, which obviously leads whathappens to the to the to the PC numbers. I think the bigger concern is we need tokeep tracking wages growth. I like looking at the Atlanta Fed wagesmeasure that's still running at about 5% in annual terms.That's just way too high. You need to see wages growth close toabout 4% or so for the Fed to be.

Comfortable.So it's really about breaking down some of those headline numbers to see whatthe components are. The Fed is certainly still looking atthat super core of services inflation, if you want to call it that.Which hasn't been moving lower at all. Diana, can we move to a different storynow and ask you about the yen? Obviously, Japanese policymakers arefinding it more urgent to come out and start signaling to the market that theyare ready to intervene if it's necessary.Will it be necessary before the end of the fiscal year, which is literallytoday?.

Maybe not literally before the end oftoday, but I think that there are obviously some growing risks that therewill need to be some further intervention in the currency market inJapan. And if not that, then maybe anothersmall interest rate hike. I think a small interest rate hike isdefinitely on the cards for the Bank of Japan in the next few months and maybe afew more by the end of this year. But they will be just small tweaksbecause the Japanese inflation dynamics are nowhere near as strong as where theyhave been across some of the other major central banks.And Japan wants to tread carefully in.

Trying to lift inflation, given thatit's been problems in trying to get inflation high for the past few decades.So some further interest rate hikes would certainly help to say to see somefurther rise in the currency in Japan. Can we get that?As soon as April. I don't think it's likely to come assoon as that. Probably the Bank of Japan only justlifted its interest rate out of negative out of negative negative territoryrecently. So we're probably likely to wait anotherfew months, but we obviously still have a lot of time to go before the end ofthe year.

And I think we will get some some smallhikes to interest rates over the course of 2024, but they will be quite minorcompared to what some of the other major central banks did.I mean, we're talking about, you know, 0.1 or 0.2 percentage moves rather thanthe 25 basis points that we're used to it in countries like the Fed, Canada,Australia or the Eurozone. How much is it putting pressure on othercentral banks, Diana, that the Fed hasn't caught yet and really isn'tsignaling any time soon anymore? I mean, still signaling cuts this year,but not in April, May, June. You know, Sweden's Riksbank, forexample, keeping its rate at 4%.

Yesterday, too.I wonder if it's a little related. Well, actually, it was looking at thisthe other day in terms of how central banks move compared to the Fed.And if you look at emerging market central banks, some of them have alreadystarted to cut interest rates. They're normally the first ones thattend to move in the cycle, whether it's up or down in terms of changing interestrates. So just because the Federal Reservehasn't cut interest rates doesn't mean that other central banks can't do that.I know we always tend to look at the Fed as a leading indicator for what'shappening to data, particularly with.

Inflation.But every economy has to manage its own inflation dynamics in its own domesticsettings. So just because the Federal Reservehasn't cut rates, I don't think necessarily means that we won't see acut by the ECB, by the Bank of Canada or by the Reserve Bank in Sweden.I think there's also a great possibility that we'll actually see a rate cut bythe Reserve Bank in Australia and the Fed is definitely a leading guide forother central banks and probably other central banks want to look to what theFed is saying, but they are still signaling a few interest rate cuts thisyear.

It's just not as much as the market waspricing in in December last year. Exactly.And of course, we have to see that piece of data as well.Maybe it will surprise us all. Diana, thank you so much for giving usyour time this morning. That's Diana mRNA, deputy chiefeconomist at AMP. So ahead, why a UAE company says theelectric car market has huge potential for growth in the region in the comingyears. But first, Israel agrees to reschedule adelegation's visit to Washington to discuss a planned offensive on Rafah.Details next.

This is Bloomberg. Welcome back to Bloomberg Daybreakmiddle East and Africa. I'm Vonnie Quinn in Dubai.The white house says israel has agreed to reschedule a council visit toWashington to discuss possible military operations in Rafah.Joining me now is Bloomberg's Paul Wallace.Paul, thanks for joining. Do we know when this meeting will happenand why Israel suddenly agreed to reschedule?Hopefully we don't know the date yet, but presumably it's going to happenquite soon.

I think maybe and maybe in some way itwas inevitable that this meeting would happen.Yes. Prime Minister Benjamin Netanyahucanceled it earlier this week in sort of retaliation for the U.S.abstaining from using its veto in a U.N.vote that called for an immediate cease fire.But the U.S. was insistent that this they wanted thisto take place because they want to discuss alternatives to a full oninvasion or full on offensive on Rafah, sitting in southern Gaza with Israel.And this is this is coming from the very.

Top.This is something Biden himself wants. So presumably this meeting will happenperhaps within days for sure. What new can the U.S.say to the delegation that might, you know, help to change minds in Israelabout a planned full on invasion? This is a huge question because Israelis absolutely insistent that the that an offensive on on Rafah must go ahead.Israel says that it's the last last bastion of Hamas and that there areprobably up to 8000 Hamas fighters. And senior the group's most seniorleaders in the city, the U.S. has say is saying it certainly doesn'twant a major offensive.

I think in all likelihood it wouldn'twant an offensive of any kind. But it's probably going to spell outsome kind of middle ground that it hopes Israel will accept something in betweena full on assault and no invasion at all.So probably something like a cohort, a moresort of coordinated targeting of the militants in the city.And Paul, just to go back to the theater of the war again, how serious wasyesterday's. Israel southern border of Lebanon,clashes? We've seen lots, plenty of incidentslike this since October the seventh and.

Even since the start of the year whentensions on Israel's northern border have have have gone up some more.However, this type of thing just adds to fears and concerns that Israel andHezbollah will get into, if not a full blown, full blown conflict, somethingakin to that. And there were civilians killed on bothsides of the border yesterday, around seven or so in Lebanon, according to theLebanese authorities. And one civilian was killed in Israel.When civilians are killed as opposed to soldiers or militants, that that issomething and that can escalate tensions.Paul, thank you so much.

Always adding context for us on theMiddle East crisis. That's Paul Wallace here in our Dubaistudio. Well, ahead of this week's localelections, Turkey's president Recep Tayyip Erdogan, has hinted at a possiblereconciliation with the country's Kurdish minority.Joining us now is Bloomberg's Turkey economy and government reporter MerrillAkerman. So, barrel, why is the Istanbul vote ofparticular importance to Erdogan? There are multiple reasons why this voteis so critical for Erdogan. Despite views of the opposition won theIstanbul vote in a landmark victory.

And that was really personal forPresident Erdogan because he himself started his political life in that cityas a mayor in the 1990s. The city also has a budget of over $6billion. So controlling it's a means access to alot of financial means and funds and also to social aid, which has beencritical for the government to shield its citizens from a massive cost ofliving crisis. With inflation soaring above 65% inrecent months and even set to accelerate further.A win for the Opposition made a commitment, although it has the seat nowis also seen, as you know, him becoming.

A national challenger to again at anational level in the future so he could become Erdogan's chief politicalopponent there as well. Berrill, do investors see any threat toeconomic policy normalization after the elections?There's no signal from the government or from President Erdogan that he willchange economic policy after elections. So investors really, in terms ofeconomic policy shakeup, see this as a non-event.Just yesterday at a rally, Erdogan said that he is behind his economiceconomic minister, economy minister, finance minister Mehmet Simsek, who'sbeen really at the helm of this U-turn.

Since last May when he got re-elected.Investors only say that in the case of an extreme election outcome in Istanbul,where, say, the opposition would win by a very wide margin, then maybe thingscould change. But they see that happening as almostimpossible, given that it's going to be a very tight race.We have, though, seen the lira come under pressure and a huge amount ofvolatility. One week, implied volatility up 13%yesterday. Barrel.So what's the story there? Well, yes, A lot of residents acrossTurkey are worried that the lira will.

Face a massive drought or see a verysharp depreciation after the elections, because the main criticism thatpolicymakers have faced is that they have been managing the currency evenafter a policy normalization since May. Now, policymakers themselves have saidthat they will maintain a real appreciation of the lira and that thevolatility is really temporary, given the elections and will subside afterruling out any sort of expectations or concerns of a sharp depreciation.Also, a temporary inflation print that was worse than expected has contributedto increased demand for hard currencies, putting under more pressure.Beryl, thank you so much.

That is Bloomberg's Merrill Ackermanthere, joining us from Istanbul. Stay with us.Plenty more still ahead right here on Bloomberg, Middle East and Africa. Welcome back to Bloomberg Daybreakmiddle East and Africa. I'm Vonnie Quinn in Dubai.Nissan says as confident as China for China's strategy of developing EVslocally is the right one for that market.The company's senior vice president told us more about balancing regionalstrategy while competing globally. Have a listen.Regional size is what matters.

China for China.Nissan is something that's working very well and we will be launching in Chinaover the next few years for new energy vehicles completely developed localizedin the and and produced obviously by by our Chinese for China business and thenelsewhere in the US, in Europe or in Japan business.We are trying to leverage global scale where it works or regional scale whereit can. We've got a very big presence in NorthAmerica, both in US, Canada and in Mexico.And and there's enough volume to generate, again, the economies of scaleto be competitive.

And being competitive just meansbringing the cars at the right price for the customers to be very happy withthose. The question that Lisa asked, though, Ithink it's a really important one and it plays into this discussion that we arehaving. Can you generate global scale when itfeels like these markets are becoming increasingly regional?And you mentioned the regional effort. I want to understand and I'll ask youdirect, what happens if we get the former president coming into power andhe doesn't just put big tariffs on what's happening in be white and withChinese automakers in Mexico, He does it.

Across the board, puts the walls up andshut everything down. If we shut down the global auto market,it becomes heavily regionalized. Does it change what you do or do youthink the market was already moving in this direction?I think the market is moving. I mean, with COVID and the semiconductorcrisis, we've been obviously much more knowledgeable and careful as to how thelogistics routes are set up across the industry.We've been thinking about the dual sourcing and ensuring of the activities.And so that's a trend that, you know, we want to continue building.Where you sell is a recipe for success.

In the in this industry.And so we are obviously very committed to making investments in North Americathat will that will help manufacture all the vehicles that will be sold here.Nissan Motor SVP Jeremy Campbell, speaking with our colleague JonathanFerro there. Well, coming up, why a UAE company saysthat the electric car market has huge potential for growth in the region inthe coming years. We'll be speaking with that executivenext. You don't want to miss that.First, let's take a quick look at how Middle East markets fared yesterday andgeneral financials continuing to be weak.

In the session.Take a look at the DFM general index. While it was down for a second day, downabout 0.3 percent, as you can see there. Much like banking contributed most tothe decline. Abu Dhabi's general index, it was downfor a third day, down about a half a percent.First Abu Dhabi Bank contributing most there.And then if we move across to Saudi Arabia, the tadawul that rose afterthree days of declines are bucking the trend in the region of about 2.2%.So a slight gain. But of course, that index is up 20% inthe last year.

So those last few sessions have taken afew percentage points off those gains, but nevertheless doing pretty well foritself in the region. Qatar's Q Index, well, it fell for athird day and again, Qatar Islamic Bank contributing to that decline.So financials really suffering in the region yesterday.That index down point 7%. Let's take a look at futures, though, aswe head into the final trading day in March and the quarter.And for Japan, at least the fiscal year. We are pointed lower, but very, veryfractionally for U.S. futures.This after, of course, the S&P bucked.

The downtrend for the week yesterday andactually rose. And for stoxx 50, it looks like it mightbe an update. Plenty more still ahead.Do stay with us. This is bloomberg.Middle east and africa. This is Bloomberg Daybreak.Middle east and africa are top stories this morning.Treasury yields on the rise after fed governor chris waller says there's norush to cut interest rates while inflation remains a problem.Ready to act. Japan's policymakers warn currencytraders they're standing by to stem the.

Slide in the yen.Plus, Israel agrees to reschedule a canceled visit to Washington to discusspossible military operations in Rafah. It's just on 8:30 a.m.across the Emirates. I'm Vonnie Quinn in Dubai and a fewthings on the market calendar today. We do have economic data today,including consumer confidence. But that PCE data, which comes outtomorrow after markets close for the quarter, that's what's really on tradersminds. Of course, we did see the S&P 500 andthe Nasdaq box on declines for the week yesterday.The S&P at an update to the tune of 0.9.

Percent, the NASDAQ 100 to the tune of0.4%. Looks like we are pointed fractionallylower, very fractionally for U.S. markets in the very early going.We did see some Treasury selling, though, because that speech from FedGovernor Chris Waller happened in the US evening time yesterday.Bond futures are pointed lower as well, with yields potentially on the rise alittle bit today as it looks like markets might start to price out a Junerate cut. After those comments, the speech wasliterally titled There is No Rush. As you can see, the two year yield at460, 75.

And then we're keeping an eye on crudeas well. Brent crude back up to 86, 35 a barrel.I want to point out this chart, though, because we do have to take intoconsideration that we are at the end of the quarter.And for Japan, it's actually the end of the fiscal year.It's the final trading day in the fiscal year.Japan to the best out of all markets in the quarter.As you can see, that blue line there is stocks, the old Country world index, infact. But Japan did the best in that, followedby Euro Stoxx 50 and then the S&P 500.

And of course, the purple is the dollarspot index. As we know, the dollar has been holdingonto strength as price cuts keep getting priced out for the FOMC.We're not quite sure when that cutting cycle will start, but we are keeping avery close eye on the yen today after policymakers told traders basically whatwas on their minds. Let's get more now from April Hong inour Singapore studio April. Yeah.Vonnie, we've been talking so much about the Japanese currency, I thought I'drecap what we've been seeing in the past three months.As we headed into the year, there was.

Speculation rife that the BOJ wouldfinally exit negative rate policy because inflation was creeping back intothe economy. But disaster struck at the start of theyear and a natural disaster prompted traders to pull back their bets that wesee an imminent move from the BOJ. We saw the yen moving from 140 towards150. The BOJ hiked last week and dovishsignals last week as well as this week sent it from the 150 towards one 152level. We're seeing that yield differential.So a big factor in all this amid hawkish Fed speech.We're seeing that weakness on the.

Japanese yen.It is the worst performer in the G10 this quarter.Now from an underperform, I'll take you to an outperformer.Let's take a look at how show me the Chinese tech meme is faring.It's been outpacing Chinese tech peers and the Hang Seng tech.And this is an $8 billion stock rally that we've been seeing a lot at stake asit unveils its EDI model today. And it will have to deliver in order tojustify its stock performance. 40.April, thank you so much. We'll be checking in with you for thenext few hours, particularly on the end.

That's April Hong there in Singapore.The electric vehicle market has been plagued by slowing sales, but weakerdemand doesn't mean progress is stalling.Bloomberg New Energy Finance says the share of global passenger vehicles fromEV only manufacturers has risen from just 1% in 2020 to 7% last year.Let's discuss the future of EVs in the Middle East region now with somebody whoknows a lot about the subject. Hassan is managing director of Dubaibased Alpha, same Electric mobility company, and he joins us now in ourDubai studio. So you've recently opened new EVshowrooms in Saudi Arabia in particular.

Tell us a little bit about how thathappened. It's a new project for you.Yes, So thanks for having me on. And then I'm glad to share all theinsights about the electric vehicle market.This is very dynamic at the minute. It's it's really for us in two differentdimension. If you look at the the the the consumerinsights, the consumer interest, it is ever growing in our region, both in UAE,in and in KSA indicates particularly I'm one of the reason why we are veryoptimistic about the opportunity is that if you look at the different surveys, upto 80% of the customers are saying in.

KSA they are willing to considerelectric vehicle as their next purchase. So and right now, if you look at thesales rate, adoption is less than almost 1%.In case this represents the incredible opportunity of the growth in thismarket. Well, it is very fascinating becauseit's quite a congested city, Riyadh, for example, Jeddah, where you've alsoopened a showroom, but you've done this without a local partner.Talk to us about that. It's a whole new world, it seems like.Yeah, we are. Alpha team.Part of the Alpha team group has the.

Team group is the more than 90 years inoperation in GC and beyond. And we have been in Saudi for a longtime. Also for our other businesses like theretail and like to the commercial construction equipment business as wellfor many, many, many years. So for us, we consider ourself as arealso local in the market passenger cars business was the one is the missing linkfor us. So we are very happy to be part of it.And also with our logistic companies, with our retail experience, alsodeveloping further the passenger car business.But the strength of our group in the.

Present in Saudi as well.Now Saudi is also investing in its own research and also manufacturing andsales. How do you see yourselves fitting interms of competition with Saudi Arabia in order to unlock the full potential ofelectric vehicle adoption? You need competition and we would onlywelcome Saudi governments and then the semi-government companies investment onon on the new companies. And we are also bringing another brandto number one in the new new energy vehicle, BYD.And I think with the choice of two different models, different technologiesand different availabilities, this is.

The way to unlock.So it's that I find that I'm very good insights.Tell us a little bit more about expansion possibilities in the regionmore broadly. And we are seeing a huge influx ofpopulations from the likes of China, from Russia and from other countries aswell, including countries in Europe. And that would present opportunities,I'm sure. Yeah.So especially if you look at in the UAE, the population more than 85% is the, aswe call it, expatriates or foreigners. They are coming with the entire the restof the world and they are bringing their.

Own consumer behaviors, then the habitsand then the insights. So it's makes it's in a very dynamic andinteresting, interesting markets and especially also now Saudi's has a hugevision to attract more foreigners to the to the kingdom.And this is obviously bringing a very vibrant, very dynamic and very wellaverse to markets. And that also requires the same fromprivate companies to cater all this needs.Do you have any figures that you have in mind or any goals that you'd like toattain? So we made our pledge when we set up ourcompanies a year ago, we said that in.

The UAE we will be by 2030 as a group,automotive group, we will be selling 50% of our entire portfolio as theelectrified vehicles. And also we will contribute to thecomplete electric vehicle infrastructure by 10% of the entire nation.And similarly, when we launching in the Kingdom four weeks ago, we made thesimilar pledge. We said that 50% or even more, 100% wecan go in Saudi with electrified and also we will invest in the localworkforce. We will hire the local people, upscaledand train them to prepare them of the new for the generation of the future.And 100% is quite the ambition and a.

Little bit about green financing becauseit's very in vogue at the moment. Is there any opportunity for you to tapthose markets debt or. Capital markets.We are sure we are as Alpha Team, a family company, and we have been puttinga very strong investment case for both in UAE and KSA in any future market.So my role is actually to unlocking this growth and then the pushing forward forthis. So this is what we are I am focusing onright now. So no plans to actually tap thosemarkets. So this is something maybe it's betteryou may talk with our CFO, but this is.

My role is just the unlocking the growththat we see as of is a magnificent opportunity for both markets and across.JCC How does it impact Ultra team mobility Company that it's now no longernecessary in the UAE to have a local partner?Does that impact you? It's sort of the vice versa of what'shappening with you in Saudi Arabia. Again, as I mentioned to you, especiallyfor an emerging technology like the electric mobility, you need morepartners, you need more world class companies and then the establishedbusinesses to come into here. So we absolutely welcome this openness.So any competition to enter because at.

The end of the competition, with theavailability of the models, the price affordability, the consumer will win andadoption will happen. I have to ask you about tastes.What are people here in Saudi Arabia looking for when it comes to electricvehicles, one of the more popular ones. So here, obviously due to in UAE, due tothe makeup of the country, the range that the consumers are drive in a dailybasis is a bit smaller. So therefore, they are looking a lot onthe full electric vehicles. But we are also offering the secondtechnology, which is the plug in hybrids, as we call the best of bothworlds, which is the electric motor and.

The battery in its it's you can drivemore than hundred kilometers and and also with the combined engine, it goesup to 1000. So we see that in Saudi due to the thethe country and the distances are being longer we see the more interest to ourplug in hybrid technology, which is a transition to the full electrificationin the in the country. We can't wait to follow the progress.And thank you so much for sharing all of your goals and ambitions with us today.And congratulations on the expansion in Saudi Arabia.That's Hassan Nagi, managing director of Alpha Team Electric Mobility Company.Plenty more still ahead.

Stay with us on Bloomberg, Middle Eastand Africa. Welcome back to Bloomberg Daybreakmiddle East and Africa. I'm Vonnie Quinn in Dubai.South African billionaire Patrice Motsepe is in talks with Vivendi's CanalPlus to join its bid for the broadcaster multichoice.Bloomberg understands the French media company is looking to make a formaloffer early next month. For more on this story now, let's bringin Bloomberg's Andre Oginga, who joins us from Johannesburg.So on zero. What's the significance of Patrick Mosbyjoining into this bid?.

One in Patrice is one of the richestblack men in South Africa, and so bringing him on board helps Vivendi meetSouth Africa's stringent black ownership requirements.And this stems from an affirmative action dubbed black economic empowermentthat requires that foreign companies are owned at least 5% by black people.And this is to promote inclusion of black people in the workforce and alsolabour force and drop them into economic activities.It's a good deal for Vivendi because it enables them to meet that regulatoryrequirement, but also it's a good deal. Should Patrice take it because one, itdiversifies his wealth portfolio.

But then again it started to be one ofthe biggest b e deals in South Africa. We understand that they'll be making aformal offer that is set to be drafted in the next couple of days and sent toMultiChoice just to jog your memory. They were offering 125 runs per share,valuing the whole company at $2.9 billion.And so the independent board will consider it in the next couple of weeksand we'll know if they like it or not. Well, should this offer be accepted andwhat does it mean for them? Andit's good for diversification and expanding their footprint across Africa.Vivendi through Canal Plus has a great.

Footprint in Francophone Africa.But MultiChoice opens them up to 50 countries across Africa.Canal Plus brings on board 8 million subscribers.MultiChoice brings on board 23 million subscribers.And combined, they are hoping to grow to about 50 million subscribers, investingin local content and also investing in sports and events has made it very clearthat they want to take on the global giants like Disney and Netflix.And by doing this, they'll be giving themselves an upper hand.MultiChoice has Showmax, which is the leading streaming platform in Africaahead of Netflix with 2.1 million.

Subscribers, and Netflix comes secondwith 1.8 million subscribers. Well, it seems to be moving along and weare continuing to follow the story on their own.Thank you. That's Bloomberg's on the Ganga inJohannesburg. For more coverage from the continent aswell, tune into our monthly special Africa Amplified.We'll be focusing on Koko this month as the key chocolate ingredients historicrally hits all time highs. That's next Friday, April 5th, at 8:30a.m.. Dubai Time Africa amplified.Plenty more still ahead today.

This is Bloomberg, Middle East andAfrica. Welcome back to Bloomberg Daybreakmiddle East and Africa. I'm Vonnie Quinn in Dubai.The waters of Oman are emerging as a hotspot for ship to ship transfers ofRussian oil headed to India. Bloomberg ship tracking shows a fourthtanker since February transferred its load of Russian crude this week to avessel near Oman. For more, let's bring in Asia oiltrading reporter Elizabeth Lowe. So, Elizabeth, why are the waters offOman becoming a hotspot for oil transfers?Haven.

Yeah.So I think this is a sign that this increased scrutiny on Russian oiltrading and that's beginning to take a toll on its supply chain.So as you said, ship checking is showing more Russian oil heading to the port ofSaline Oman before being transferred by ship and moving on to India.So this development is pretty interesting because the port ofSingapore doesn't typically import a lot of crude.And that's also a pretty popular spot, well known in the oil community for shipto ship activity, which is also often associated with the need to mask illicitactivity in oil.

So the is coming on the back of a prettyinteresting development, right? Last week we saw Indian oil refinerssaying they will no longer accept cargoes of oil of tankers belonging toRussia. State run off conflict.And that's becoming and that's becoming an issue because, of course, Indian oilrefineries are a big buyer of Russian oil to the second largest customer afterChina. SoI think it really highlights a big issue that's going on in oil right now, andthat's the increased scrutiny of Russian oil trading flows.So people are watching that.

It definitely seems like there is a lotmore scrutiny now. So how might impact oil markets andpricing in particular? I think that's a question everybody isstill watching. It's been a pretty it's been a prettyimportant development in the backdrop. And people are looking at how the U.S.is taking action on Russian tanker companies, Russian flows, price caps.So these events are quite vital right now.Of course, if there is a significant hit to Russian oil supply supply chains, itcould affect their exports. And I think people are watching to seewhat alternative flows could come up or.

What other trading activities that thatcould come up because of this. Yeah.It's fascinating. We are definitely going to continue tomonitor this story. Elizabeth, thank you so much.That is Bloomberg's Elizabeth Lo. And while we're at it, let's take a lookat where we are in terms of oil prices right now.As I said, there was a little bit of softness to Brent yesterday after we gotword the stockpiles were pretty high and that's actually coming back again today.Brent is trading above $86 a barrel, as you can see, 8635.And same for an IMAX and IMAX crude oil.

Above $81.81 70 right now, a 4/10 of 1%.So we're continuing to see some strength in oil markets in spite of stockpiles.Well, on the same topic, for months, the Houthis have attacked vessels in the RedSea in retaliation for Israel's military actions in Gaza.A 50,000 ton cargo ship called to confidence was targeted earlier thismonth. Three seafarers were killed in thatparticular attack in what is now a deadly new era, it seems, for theinternational shipping industry. For more on this story, I'm joined byBloomberg's Verity Ratliff. So a new era and the sense that peoplewere actually killed this time around as.

Opposed to all of the other attacks inwhich there didn't seem to be any casualties.What does it mean in terms of the Red Sea and, you know, standing out inparticular this particular attack? Well, like you say, this particularattack stands out because of the death on board.Three people died and two others had life changing injuries.And this is the first such attack that's resulted in these deaths on board.But it also stands out as well, because the crew actually had to abandon ship.The ship was on fire and the crew had to flee onto essentially dinghies.The the life rafts were only available.

Because the lifeboats were affected bythe impact of the missiles from the Houthis.And the it also stands out because it had such a difficult process gettinginto a safe haven. You have to send in a salvage crew to goand pick up this vessel into essentially a war zone.And it was incredibly difficult. And I mean, the attack happened on the6th of March and the vessel is still being towed to safety now.There's a timeline of events in your story and it's really incredible.I mean, this just had to be painstakingly done by this rescue vesseland they even had to fend off attacks on.

Their own vessel.Right. And then when they finally get there,there are things like barbed wire that this these crew members have to getover. It's really an incredible rescue story,if you like. But what does it mean for what willhappen next in the region? Because clearly efforts to secure theRed Sea by other countries have not worked.Absolutely. I mean, the perceived risk of thattransit waterway is is much higher. Perhaps the actual risk is is the same.We've seen attacks consistently over the.

Past few months.But just the fact that this has resulted in deaths on board,it definitely raises the perception of that risk.And that can affect Cruise, which a vast majority of crews are in unions and theyhave protections allowing them to decline the routes if they feel that isunsafe. So it could affect Cruise, it couldaffect the shipping industry as a whole. Already, the transit through that routeis 70% down. It could go even lower.Yeah, And I mean, we have seen container shipping prices really escalate andthey've been pretty volatile over the.

Last couple of months.I'm just curious as to how it will affect the shipping industry morebroadly. Absolutely.Costs are a huge issue If you don't go through the Red Sea and the Suez Canal,you have to go all the way around the southern tip of Africa.That adds a huge amount of costs and affects delays to shipping, whichimpacts everything that arrives by ship, grains, oil, absolutely everything thatgets transported by ship. I've already.Thank you. I'd urge everyone to read the story.It really is a phenomenal story of how a.

Rescue happened and very, very, verydifficult circumstances as very right there.Well, let's take a look at where we stand futures wise.It is the last trading day in most developed markets and most emergingmarkets for the quarter. We are looking at a down day in terms offutures in the US, but futures in Europe pointed to potentially a higher open atthe very least, but we're talking very fractional next lower there for U.S.futures. All eyes will be on what happens to theTreasury market, I would say today after Chris Waller, his comments yesterdayevening, US time in which he said.

Basically there is no rush.That was the title of his speech. What he was saying was he wants to seeat least a couple of more months of softer inflation data in order for himto be comfortable agreeing with going ahead with a cut.So that means that it's a possibility traders will start pricing out a JuneFed card. After all, we know that the likelihoodof three cuts this year has gone down, at least according to the Fed's close.And now it's sort of on the cusp of between two and three.So will the market revised to that after today?We'll see.

There we have U.S.Treasury yields right now for 6075. So we did go up a couple of basis.Points from yesterday and on the ten year for 2061.Let's take a look at oil markets. As I said, strength in the oil marketsin spite of continuing stockpiles, 8636 for Brent, 81, 74, 90.Max, do continue to stay with us.We have plenty more still ahead. Jennifer is up.Assata joins me next from johannesburg for bloomberg.Bill, east and africa. This is Bloomberg Daybreak, Middle Eastand Africa.

Our top stories this morning.Treasury yields rise after Fed Governor Christopher Waller says there's no rushto cut interest rates. While inflation remains a problem.Ready to act. Japan's policymakers warn currencytraders they're standing by to stem the slide in the yen.Plus, Israel agrees to reschedule a canceled visit to Washington to discusspossible military operations in Rafah. All that and more this morning.It is just past 9 a.m. across the Emirates, 7 a.m.here in Johannesburg. I'm Jennifer is at the Saja.And I'm Vonnie Quinn in Dubai, and it's.

A big day today and the last day oftrading for many markets and of course, a free day.But there's something else going on today as well that we can't forget tomention. Perhaps the biggest event of them all.A little birdie tells me it's somebody's birthday today.It is? Yes.Did somebody tell you that? I don't know how many yesterday.It is my birthday and it is a big day for many people, of course, because wemention it's the last trading day of the quarter.It's also the last day before a long.

Weekend for a lot of people.But thank you, Vonnie, for mentioning that.Well, I hope you get lots of chocolate this weekend, even more than usual.And I'm sure you'll get lots of flowers and all sorts of nice presents youtotally deserves. And have a wonderful happy birthday.Well, I guess we'd like to be healthy marketsas well. So let's take a quick look at whereequity index futures stand, at least in terms of U.S.futures. We might be looking at a down day or atleast just taking a little breather,.

Perhaps doing nothing much at all ofanything. Before we get the PCI data.We do get confidence data out of the US today as well.But we do have an update for the S&P 500 and Nasdaq yesterday after some straightdays of declines. So that was a little bit of a breatherfor investors who've been waiting for that to happen.The S&P was up 9/10 of a percent and the Nasdaq was up 4/10 of 1%.In spite of Nvidia really just dragging on the Nasdaq.It was down two and a half percent for a second day of declines for Nvidia.And then after Waller, we did see the.

Two year yield futures wise, it's up,bond prices down. We'll see how that plays out in today'strading for 6075 on the two year right now.Yeah. Vonnie while those comments, veryinteresting there. Let's take a look at some other assetsthat we've been paying close attention to throughout the quarter.I want to start with brent crude and oil.Of course, as we can see, definitely an update right now for both Brent crudeand WTI. Brent crude at about 8639.And we're seeing oil really head towards.

A solid quarterly gain at largely thatis because expectations that opec+ supply cuts will tighten the marketthat's coming even despite the stockpiles that we've been talking aboutfor the past few weeks. Bitcoin also pulling back slightly fromwhat we saw over the past few weeks, but at about just over $69,743 there.Some strategists, though, and investors, it's very interesting to hear whatthey're saying. Some people are saying the boom hasgotten out of control. BlackRock's Larry Fink, though, notedthat he was surprised in the rally that we've seen.So we'll have to see whether or not that.

Continues in the second quarter.And just speaking of rally, I just want to take a look at some of these assetsthat we've been paying close attention to over the past few weeks that havereally are really ending on a high as that chart there shows, Bitcoin gold andof course, cocoa, which we've been talking about for a number of weeks.Again, we'll see whether or not that momentum continues into the secondquarter. All right.Let's check in, though, on how markets in Asia are faring.Adrian Hong is standing by in our Singapore studio.Hey, Ron.

Hey, Jen.You know, we're seeing a pretty mixed bag in the Asian session today.Almost opposite trend from what we saw yesterday when Japan was leading thecharge, Chinese equities were languishing.We saw CSI 300 Hang Seng closed with losses of about one plus percent.Today, it seems that extreme pessimism is easing off a little and the Chinesegauges are climbing. We're seeing the Nikkei underperformingin the region. Yesterday, it was a lot to do with howit was the last trading day before companies went ex-dividend.Today, there's some profit taking on the.

Way.That's what the board. And take a look at how the Nikkei hasbeen performing this quarter. It has been outpacing gains in many ofthe major benchmarks globally. And this has a lot to do with the cheapyen, corporate governance improvements, the economic revival underway in Japan.And this seems to be also what is continuing potentially into the nextquarter. It is those fundamentals that remainintact. Can't say the same for the Japanesecurrency, though, because it is the worst performer in the G10 interventionchatter is helping to cap those declines.

Today.But we have hawkish Fed speech that I'm sure is not helping guys.Well, April, let's continue to talk about that.That's April Hong in Singapore. As April mentioned, hawkish speech.Federal Reserve Governor Christopher Waller saying the central bank shoulddelay or reduce the number of rate cuts seen this year.He called the recent inflation figures disappointing and said he wants to seeat least a couple of months of better data before agreeing to cost.For more on markets, let's bring in live strategist Mark Cranfield.So Mark, it seems like Moeller might.

Have been the person who shifted the dotplot slightly in favour of two as opposed to three cuts.Might we see the market reprice that in today and maybe start pricing out a Junerate cut? Yeah, I think it's been it's been goingon for a few days actually. He's adding to comments that we heardfrom Mr. Bostic just a couple of days ago.And gradually, you can see traders are taking away some of those expectations.We've even got people in the options market who are now betting there won'teven be a June interest rate cut from the Federal Reserve.We've got a lot more Fed speakers coming.

Up in the next two weeks.There's a lot of data as well as you're mentioning, P is one of them got ism aswell and there's a few others which will be thrown in there.So if you're looking for reasons why people would want to dial back on theirexpectations for the Federal Reserve, there are plenty.Coming up in just the next few days, Jerome Powell will be speaking, but heseems to be getting outweighed here by the number of people questioning whetherthree cuts are really necessary or whether they can even do it while thedata is too strong in the United States. And this is obviously feeding into howpeople feel about different asset.

Classes, especially about the US dollar,as you mentioning earlier, dollar and it's still very high, still above 151,even though we've heard a variety of speakers out of Japan saying they'rethey're concerned at the pace of the yen weakness.Yeah, it's really fascinating seeing how the markets are really interpreting,interpret, interpreting these comments at Bloomberg's Mark Cranfield.Mark, thanks so much. Let's continue this conversation now andbring in June Bay Loo. She's the portfolio manager at TribecaInvestment Partners. So Jen Bay, let's just start here andpick up where we left off with Mark.

How are you interpreting Waller'scomments and is it making you rethink your strategy in terms of yourportfolio? Look at it.Look, I think the comment itself is very much in line with, you know, morerational expectations. You know, we have always thought it wascompletely irrational last year for the market to stop pricing in a rate cutfrom March and June onwards. And, you know, clearly the market inMarch didn't happen. And from June onwards, we think it isway too early. That data point so far has shown thatthe economic reality is pretty strong.

Now, the market is still pricing in somefurther down the track. And for this year, still a couple ofcuts are pricing in. You know, my view is that it is stillvery, you know, still very ambitious for us to achieve those cuts, given we dohave the US election latter part of this year and the Fed is likely to stay outof the market. So, you know, as an investment strategy,we are buying insurance policies. We do think the you know, that themarket is a little bit too ambitious in terms of how many rate cuts we will seethis year. Deb, why would the Fed not move, youknow, in an election month or the.

Previous month of the previous monthbefore that? If we do see inflation data coming in, Imean, it would be dangerous for the economy not to start moving at thatpoint, wouldn't it? Look, I think the latest you know, we dohave a small window that they will have to move, which is probably between Julyis not going to be likely. We think that's way too soon is July,August and potentially September. But look, I think it's very unlikely forthem to do anything after Labor Day in September just because it's getting waytoo close to election. They wanted to see to be seen that theyare not, you know, politically charged.

And they want to stay away from all thenoise, the political noise that will pick up by then.So, you know, my view is that you have a couple of months of opportunity, windowof opportunity. We do need to see the data to reallypull off very quickly for us to get there, though.So, you know, as an investor, we played that probability thinking it's probablygetting closer to less than the three three rate cut is probably clearlyunlikely. You know, even two rate cut, I thinkit's probably too ambitious at this stage.When we think about globally.

Jun Bay, in terms of these comments andwhether or not or when the Fed is actually going to cut reverberatingaround the world, we heard April Hong talking about the yen and the effect ofall these comments on the dollar yen cross.I mean, where do you think we're going to see this really having the biggestimpact right now? Look, I think the rate cuts, theindication, I think, you know, ultimately taking a step back, it'sactually not how many rate cuts and the like.It's really about the direction of the rate, the rate that the interest rate.And we know it's going lower, you know,.

With the direction of interest rategoing lower, it sends a very reasonably positive signal to global asset value.And I think, you know, with that comfort, you know, around the world, theasset value will remain stable. And, you know, whether it's two cuts orwhether it's one cuts, you know, regardless, we know the interest ratecut is coming. So it puts a lot of comfort to actuallyaround the world for asset prices. You know, I think the bond market ispricing it wrong. But I do think, you know, for otherasset class, such as equities, that we see a lot of opportunities on the basisof that.

Where would you see those opportunities?I was reading some Bloomberg intelligence reporting today talkingabout how if you exclude the top seven firms like Apple and Nvidia and so on,the S&P trades at about 19 times earnings as compared to 21 timesearnings for the full index. And that does present some opportunitieswhere there's discounting. Yeah, look, absolutely.Look, I do think the top seven is very expensive, but there is some thematicthat you do need to play a ISE hard to catch.And then there's only a very limited number of companies who can play that.So the scarcity value and perhaps you.

Should be there, but really a lot ofvalue and cyclical companies, which is where you see opportunities.You know, when we talk about the interest rate potentially heading lower,if whether it's one or whether it's two, you know, it is very positive forcyclical or, you know, economic sensitive sectors and where theycurrently are trading a much, much cheaper valuation.Also, you know, if you take a notice towards China as well, you know, it'scoming up a very, very low base and there's no investor interest at themoment in that market. It's certainly represent opportunity onthat basis.

So, you know, we would say as activemanager, we see opportunities everywhere, but it's really just to beselective for where to go. You know, I do think 2024 is going to bea year where, you know, active managers, where you selective about yourinvestment opportunity, you will make a lot of return.But on an index level, you probably generate still positive but probably abit more volatile to get there. Well, in June.Very. You say that you and your team arebuyers of every dip. I mean, can you give us some insightinto that and where exactly you're sort.

Of looking to right now?Look, I think just underpinning our thesis for the equity market is thatwe're pretty positive. The equity market, we're seeing somesectors a bit more expensive. But with interest rate heading where itis, it's great for asset prices. So, you know, with the corporates thatwe've seen the you know, the health is pretty strong.They're very cashed up, they're good at managing margins.Yes. Top line will be under pressure.You know, we do think they will manoeuvre through this period prettywell.

Now this is before, you know, interestrate cuts and the like and China coming back.So, you know, net they're on a 12 month view or even two years view.I do think economic reality look pretty good for the corporates.So I will be buying on the dip on you know when the market worry about concernabout the outlook because I think underlying fundamental is pretty strong.And for some sectors, as I touched on before, the valuation isn't thatexpensive. To embrace.Thank you so much for joining us this morning.John Value is portfolio manager at.

Tribeca Investment Partners.Still ahead, South African billionaire Patrice Motsepe is in talks with Vivendito join its bid for a broadcaster. MultiChoice will have those detailslater in the hour. But first, Israel agrees to reschedule avisit to Washington to discuss a planned offensive on Rafah.This is Bloomberg. Welcome back to Bloomberg Daybreakmiddle East and Africa. I'm Vonnie Quinn in Dubai.The white house says israel has agreed to reschedule a canceled visit toWashington to discuss possible military operations in Rafah.Joining us now is Bloomberg's Paul.

Wallace.Paul, quite the turnaround. Do we know when this meeting might bescheduled for and why the quick turnaround?IVANY We don't know yet, but I presume it will be very soon, maybe even amatter of days, because this is something that both Israel and and theU.S. can't really afford to delay for muchlonger. Israel has been saying for several weeksnow, almost two months that it has to go into Rafah.It claims that it has no option because the city is the last and last bastion ofHamas and that it has roughly 8000.

Fighters of the Iran backed group thereand most of its senior leaders. There is a thinking that nothing willhappen until after Ramadan, and so that would mean around mid-April before anykind of offensive. Israel is still saying that it willallow civilians to leave the city. There are more than a million of themthere. They're seeking refuge from the war andmost of them were told to move there or urged to move there by the Israelimilitary, which was focusing on the north of the Gaza Strip in the in thecenter parts initially. This meeting will be significant when ithappens.

The U.S.is going to present alternatives to Israel because it doesn't want theIsraelis to go into Rafah with a full on assault.In reality, they probably don't want Israeli forces to go in at all.But I think they realize that Israel is not for budging on this point.Netanyahu and his government, as I said, are adamant that they need to go in.So the U.S. may wellpropose I don't want to call it a light offensive, but something that's notquite a full on assault on the city. Well, but, Paul, I mean, what are thesealternatives?.

Because if Israel and Netanyahu is so,you know, steadfast in wanting to invade Rafah, I mean, what are the options herefor the U.S. in terms of persuading him not to?That's a good question. And the U.S.hasn't publicized any of its thinking on this matter yet.But broadly, it's probably going to be the US suggesting that Israel goes forsomething, a more surgical plan, perhaps with the use of Special forces and tomore directly go after Hamas fighters in in Rafah rather than using thousands oftroops and sort of assaulting the city from from from all sides.But that's something I think we won't.

Know for sure until after this meetingin this previously council meeting in Washington actually takes place.Yeah. And I mean, it's fascinating.This does seem to at least move the ball forward.But, you know, in the other area of Israel where this fighting right now,which is the northern border on the border with Lebanon, it did seem toescalate yesterday. How bad is it?Well, I think it did escalate. We saw civilians being killed both inLebanon and in Israel. The Lebanese authorities say eightcivilians were were were killed by an.

Israeli airstrike.One Israeli civilian was killed when Hezbollah retaliated.We have seen a lot of the sort of tit for tat skirmishes since October theseventh and many more of them since the start of this year.Yesterday, it looks like it's not going to escalate much further, but itcertainly adds to fears that Hezbollah and Israel might be heading to a full onconflict. And we cited an Israeli poll in one ofour stories yesterday that said almost 70% of those surveyed think that there'sa fairly high or very high chance of Israel and Hezbollahgetting into a into a full on war.

That's not Israeli saying they want it,but that's Israelis surveyed saying they thinkthere's a good chance of that happening, which makes for a pretty grim, grimreading. Yeah, we'll have to pay attention to howthat meeting goes in Washington. Bloomberg's Paul Wallace.Paul, thanks as always, for joining us. Thanks for that reporting.All right. Plenty more still ahead.Stick with us. This is Bloomberg. Welcome back to Bloomberg Daybreak,Middle East and Africa and Jennifer's.

Ambassador in Johannesburg.Let's turn to Turkey ahead of this week's local elections.Turkey's president, Recep Tayyip Erdogan, has hinted at a possiblereconciliation with the country's Kurdish minority.Joining us now is Bloomberg's turkey economy and government reporter barrelakman, who's been following the story. So barrel, why is the Istanbul vote ofparticular importance for Erdogan? Walk us through this.Well, for Adorno, this is a really personal matter because he started hisown political life as mayor in the city back in the 1990s.So when the opposition mayor won five.

Years ago in the city, it was reallypersonal for him. And now it's Ekrem Imamoglu, the currentmayor of Istanbul, secures the win again.Then that will be seen as him becoming the main challenger to us on thenational level. The city is also a massive source offunds for foreign managers. It has a budget of over $6 billion andit's part of the government's funding for social aid to shield itsresidents and citizens from a massive cost of living crisis.So having access to those funds and financing is also critical for thepresident.

Barrel.Why has the lira come under pressure ahead of the vote?Huge volatility. Yes, exactly.There's a lot of pressure that the lira has come under this month, particularlyover concerns that the currency might face a bigger rout or sharperdepreciation after the elections. That's because the policy makers and thecentral bank has come under pressure and come under criticism for managing thecurrency. They said themselves that they'llmaintain a real appreciation of the leader of a ruling out any possiblesharp depreciation concerns.

And the finance minister, the country'sfinance minister, also said that this volatility is temporary and will subsideafter the vote to manage some of that volatility.The central bank last week raised the benchmark rate by 500 basis points to50%, and that has relieved some of that pressure that we've seen in recentweeks. Beryl, are investors convinced, though,or do they still potentially see a threat to economic policy normalization?I think given Turkey's policy swings, there's always a concern that investorscannot rule out permanently. But this time they say that it'sdifferent.

They don't see any major risk to policycontinuity after elections, even if the opposition wins, saying that it'll be avery tight race and if the opposition wins, it'll be by a very narrow margin.But they do say in case of an extreme election outcome where the oppositionwould win if stumbled by a very wide margin, then there's there's a risk thatpolicy could change. But for now, they view this election asa non-event. Beryl, Thank you so much, Beryl.We'll be following the election and its outcome throughout the weekend andbeyond. So thank you for that.That's Bloomberg's Beryl Ackerman there.

In Istanbul.Let's take a look at markets and particularly Middle East markets.Let's start there. How they fared in yesterday's session.Of course, there's one more session to go as well.The DFM general index down for a second day by about 2.3%.As you can see, financials were weak across the region.In fact, much like bank was the worst performer in the DFM, or at least it wasthe biggest drag in Abu Dhabi's general index priced Abu Dhabi bank contributedmost to that decline, which was a third day of declines, down about a half apercent.

The dismal was the bright spot in theregion that was up after three days of declines.It was up by just point 2%, but nonetheless, a better sign.And Qatar's QE index, it fell for a third day, just about 7/10 of a percentlower. In terms of US markets, we are going totake a quick look at where we stand futures wise in a moment. This is Bloomberg Daybreak, Middle Eastand Africa. Our top stories this morning.Treasury yields rise after Fed Governor Christopher Waller says there's no rushto cut interest rates.

While inflation remains a problem.Ready to act. Japan's policymakers warn currencytraders they're standing by to stem the slide in the yen.Plus, Israel agrees to reschedule a canceled visit to Washington to discusspossible military operations in Iraq. It is just past 9:30 a.m.across the Emirates, 7:30 a.m. here in Johannesburg.I'm Jennifer's ambassador to. And I'm Vonnie Quinn in Dubai.And we did see in the US yesterday the S&P 500 and the NASDAQ 100 make somegains after several days of declines. Luckily, because we are pretty easy PC edata Friday and also there's no trading.

On Friday.So it gave the market a little bit of hope and that was all before ChrisWaller came to the microphone. 6 p.m.us time on Wednesday evening and said, look, there is no rush.That was the title of his speech, was basically saying he wants to see atleast a couple of months more data on inflation.That will convince him then to actually allow the rate cycle to start the ratecutting cycle to start, I should say right now we have U.S.futures pointed fractionally lower and the two year yield up a couple of basispoints.

We are seeing a little bit of selling.Bond futures pointing to a little bit of selling in the wake of Waller'scomments. But let's have a look at the quarter sofar, which actually today is the final day of the quarter.And as you can see, no surprise stocks. The old Country world index, which isrepresented by that blue bar there where the best performers cost assets in thequarter. Within that, Japan was the bestperformer followed by the Euro Stoxx 50 and the S&P 500.And then after that as you see the blue bar, well, that represents the dollarindex.

The dollar index, of course, has beenstrengthening since the FOMC started to push back and push back its rate cuttingcycle. And again, Jan, after the wall, ourcomments will be very interested to see what the Treasury market does.Mark Cranfield earlier is saying it's been happening for the last few daysanyway, this repricing. Yeah.Yeah, absolutely. And we'll hear from Jerome Powell aswell. So we'll see whether or not that makesmore of an impact. Vonnie, look, let's take a look at whatcrude is doing right now, seeing upside.

Right now.If we take a look at brent crude at about 86, 54, up nearly 5/10 of apercent. Also WTI seeing some upside and reallyyou mentioned the end of the quarter. Oil is heading towards a really solidcore quarterly gain that's largely off the back of opec+ supply cuts that arepotentially going to tighten the market and also supported by the geopoliticaltensions that we've seen in the Middle East.Also demand growth somewhat stalling in Asia, but of course we've talked aboutthe stockpiles and potentially how that's going to balance out what we'reseeing in terms of crude.

When we look at Bitcoin right now, it'spulled back slightly from the highs that it's all just a few days ago at about69,000. But levels are still really leading anumber of strategists and investors to to feel a bit surprised at just how highthis rally has gone and how much it's been sustained.We've heard from BlackRock's Larry Fink, who noted his own surprise in the rallythat we've seen. We'll see whether or not that continuesinto the second quarter. And finally, just speaking of rallies, Ithink we have to look back at the quarter that was and these this was agood quarter for a number of assets, as.

You mentioned.But these assets really had a solid quarter, Bitcoin, gold and cocoa.And so, again, we'll have to see as this is the last trading day of the firstquarter whether or not the momentum sustains for these.All right. Let's check in on how markets in Asiaare faring. Avery Hong is in our Singapore studio.Hey, April. Hey, Jennifer, We're seeing a gauge ofstocks in the region flat. Chinese equities are leading the way andthey are reversing the declines more or less from yesterday.A bit of that pessimism easing off tech.

Media shares.Those are the ones that are outperforming.And the ME Taiwan stock is the big boost for the Hang Seng today.The Chinese delivery company is getting its upgraded outlook from Moody's fromstable to positive. And let's also take a look at what we'reseeing in the rest of Chinese equities because earnings season is underway.We have the likes of Bocom, ICBC reporting and it looks like those badknown ratios are taking up. Increasingly, the property crisis isshowing up on these state lenders balance sheets.We also have the trouble develop a.

Country garden reporting later today andwe are expecting those steep losses to show up.Its stock is rising today but wouldn't read too much into it.It did after all yesterday, close about 8% lower.So that's what we're seeing in Chinese equities today, guys.Avraham, thanks so much. A role in Singapore there for us.Let's turn to the African region. South African billionaire PatriceMotsepe is in talks with Vivendi's Canal Plus to join its bid for the broadcasterMultiChoice. Bloomberg understands a French mediacompany is looking to make a formal.

Offer early next month.For more on this, we have Bloomberg's Indira Oginga joining us here in ourJohannesburg studio. So, Indira, just walk through thesignificance of Patrice Motsepe joining this bid.Patrice is one of the richest black men in South Africa and he's joining theBee, then gives Vivendi an upper hand and enables them to meet the regulatoryrequirement. In South Africa, there's somethingcalled the Black Economic Empowerment Affirmative Action that was introducedto try and promote inclusion in the labour market.And it requires that 25% of companies be.

Owned by a black person.So that's the advantage that Patrice brings on board.On the flipside, it serves him also because it diversifies his wealthportfolio. This is touted to be one of the biggestbee deals in South Africa, and we expecting that in the next couple ofdays they're going to put through a formal offer, 110 to 9 runs per share,valuing the whole company at $2.9 billion.And a board of directors is going to consider the deal.And then in a two or three weeks, we'll know whether they like it or not.So should the offer be accepted on their.

Own?What would that mean for Vivendi? It's good news for Vandy because itopens them up to the whole of Africa. If we look at Canal Plus, they have aheavy concentration in Francophone Africa.While MultiChoice has a big footprint across Africa, they'll be introducingthem to about 50 countries in sub-Saharan Africa.Canal brings on board 8 million subscribers.MultiChoice brings on board 23 million. They're hoping to build up to 50million, invest in sports, invest in local content.And also they've made it very clear that.

They want to dip their toes into globalstreaming platforms. They want to take on the likes ofNetflix and Disney. And Showmax is the best avenue to dothis because they're the leading streaming site in Africa.At 2.1 million subscribers ahead of Netflix with 1.8 million subscribers.Wow, What a subscriber base that would be on there.Thanks so much. That's Bloomberg's on the pro Ganga inJohannesburg there. And I do want to point out that we arejust a few days away from our next Africa, amplified of course hosted andconceived of and everything else by Jen.

Salazar.Also, Jen, I know we are concentrated on the upcoming elections.You were speaking with some of the candidates this week.Tell us a little bit what we should expect out of next Friday's program.Yeah. And we're all actually speaking to theopposition candidate of the day later today.But Vonnie, really our focus is going to be on soft commodities.And the reason is because we've been seeing the price surges that we've beenseeing. And it's not just cocoa.There's a number of other soft.

Commodities that are seeing much higherprices this year. And the reason why this is a focus is,of course, the African continent. The African region is is ripe with farmsand with a plentiful amount of product in terms of soft commodities.But is this actually trickling down to the people who are cultivating thesefarms? And what then where then are theseprices going? And so we're going to take a look at itfrom a few different angles. Follow the supply chain as we say, seehow it affects the farmers, see how it's affecting retailers, see how it'saffecting consumers and people like.

Yourself who eat chocolate.So that that's the plan for our next show, which is on April 5th.Yeah. I mean, it is fascinating, isn't it,Jen? Because, you know, you immediately thinkof sort of how it affects you and prices and so on.But there are so many stakeholders here when it comes to these higher prices ofcommodities. And, you know, it can lead to so muchsuffering on the one hand and then profits on the other hand.And it's, as we say, always follow the money.Right.

That leads us to where the answers toall these questions are. So, Jen, remind us when we can see this,where we can see this and what time. Yeah.So the show airs the first Friday of every month.So there's our full screen showing that it is April 5th.That is our next episode. And as you mentioned, Vonnie, the bigquestion here too, is whether or not these prices will actually sustain.So we're going to take a look at that and speak with some investors as well toget their insights. All right.Plenty more still ahead.

Stick with us.This is Bloomberg. Welcome back to Bloomberg Daybreak,Middle East and Africa. I'm Jennifer's office soldier inJohannesburg. The waters off Oman are emerging as ahotspot for ship to ship transfers of Russian oil heading to India.Bloomberg ship tracking shows a fourth tanker since February transferred itsload of Russian crude this week to a vessel near Oman.Let's bring in our Asia energy and commodities editor Andrew Janes, who'sbeen following the story. So, Andrew, why Oman?This is a fascinating story that we have.

On the terminal now.Hi, Jennifer. Yeah, well, ship to ship transfers ofoil are pretty common, and they're usually done to mask the origins ofcargoes in the Middle East.The waters of Fujairah are quite a popular destination for this to happen.It also happens in Asia, off the waters of Manila and waters off Malaysia.Oman has been a bit of a popular spot for a while.It's happening off the port of Soha in Oman.But what's the recent development is that it's happening in particular toRussian oil.

And we ship track it with sort of trackships that are that were heading to India and the Neptune back from Indiaback to our man discharged oil. And then, you know, the other ships thathave gone to India. And that's happening against a backdropof increased US scrutiny of the flows. Yeah, it's real oil market forensicaccounting, kind of the work that you're doing here.How might that all impact oil markets more broadly, though, if there is thisscrutiny now and, you know, we're bringing light to a toin terms of global prices, it's probably not going to have a major impact, butit's certainly important for India.

India was a very enthusiastic buyer ofdiscounted Russian oil. Ever since the invasion of Ukraine, thattrade's become a bit more disrupted. Recently, though, for a start, thediscounts it was getting on Russian oil are not as big.And secondly, as I mentioned, there's been a lot more US scrutiny of theflows. We recently had all Indian refiners saidthey wouldn't take any oil carried on. So confluent tankers, that's the Russiantanker line. So yet in India and Steve, we saw thatit will increase costs for refiners there.And of course, India is very dependent.

On oil imports as it produces verylittle itself. Andrew, thank you.We'll have everybody read the story because it is a fascinating look intohow oil that we should be moving around is moving around.That's Bloomberg's Asia Energy and commodities editor, Andrew James.Over months, the Houthies have attacked vessels in the Red Sea in retaliationfor Israel's military actions in Gaza, according to the Houthis.A 50,000 ton cargo ship called True Confidence was targeted earlier thismonth and three seafarers were killed in that attack.And what then became a deadly new era.

For the international shipping industry.For more on the rescue story, we're joined by Bloomberg's Verity Radcliffe.So it was really fascinating that really nobody had been killed up to that point.There have been so many attacks, 30. But tell us a little bit about how therescue of this ship happened post these seafarers dying.Well, it was quite an incredible operation.The the surviving seafarers had to abandon ship immediately and they werepicked up by an Indian warship quite promptly.But that left the ship abandoned on fire and adrift.So the salvage crew had to, first of.

All, find the ship and then clamber upthe sides while the ship was still on fire.Come down a little bit, but it was still burning and there was barbed wire liningboth sides of the ship, making it even harder, presumably installed by the crewas a sort of last line of defense against piracy.Verdi. What happens now?I mean, what is it that you and the team are paying close attention to,especially because we have seen these attacks really escalate over the pastfew weeks? Yeah, we really have.I mean, these attacks are almost daily.

And it's been going on for severalmonths. We're just keeping abreast of what'shappening through the Red Sea route. Obviously, a lot of ships are no longertaking that route. Transit is already down 70%.But still, we're interested in any new threats, any increase in the threats inthe area. But already the impact has been quitesevere. So what happens next?I mean, we've seen shipping costs really, you know, go exponentiallyhigher. And there has been a bit of volatilitythere, down slightly in some cases now.

But what does happen next?Well, you say costs is the big aspect. The other thing is this crews becausecrews have to agree to go through these these areas.And obviously, especially with an attack like this where seafarers have died andcrews might not necessarily want to do that anymore.We spoke to a representative from the Philippines who said that perhaps crewsmight not want to take these jobs anymore, which is very understandable.Two of the seafarers that died on board this ship, they were from thePhilippines. So it could have a big impact on crews,which makes.

The shipping more logisticallydifficult, obviously. And in addition to the massive costincreases of going around the southern tip of Africa, instead of going throughthe Suez Canal and even broadcasting that they're from a particular place,doesn't seem to have all that much impact because obviously the Houthies,you know, are not exact exactly what they're targeting.Variety is fantastic story and we really, really appreciate it.And again, another great one for everybody to read.That's very deep right there. Plenty more still ahead right here onBloomberg Daybreak, Middle East and.

Africa.This is Bloomberg. Welcome back to Bloomberg DaybreakMiddle East and Africa. I'm Jennifer's office object inJohannesburg. Nissan is confident its China forChina's strategy of developing EVs locally is the right one for thatmarket. The company's senior vice president toldus more about balancing regional strategy while also competing globally.Regional size is what matters. China, for China and U.S.is something that's working very well and we will be launching in China overthe next few years for new energy.

Vehicles completely developed, localizedin the and and produced obviously by uh, by our Chinese for China business andthen elsewhere in the US, in Europe or in Japan business.We are trying to leverage global scale where it's work.So regional scale where it can. We've got a very big presence in NorthAmerica, both in US, Canada and in Mexico.And, and there's enough volume to generate, again, the economies of scaleto be competitive. And being competitive just meansbringing the cars at the right price for the customers to be very happy withthose.

The question that Lisa asked, though, Ithink it's a really important one and it plays into this discussion that we arehaving. Can you generate global scale when itfeels like these markets are becoming increasingly regional?And you mentioned the regional answer. I want to understand, and I'll ask youdirect, what happens if we get the former president coming into power andhe doesn't just put big tariffs on what's happening in be white and withChinese automakers in Mexico, He does it across the board, puts the walls up andshut everything down. If we shut down the global auto market,it becomes heavily regionalized.

Does it change what you do or do youthink the market is already moving in this direction?I think the market is moving. I mean, with COVID and the semiconductorcrisis, we've been obviously much more knowledgeable and careful as to how thelogistics routes are set up across the industry.We've been thinking about the dual sourcing and the ensuring of theactivities. And so that's a trend that, you know, wewant to continue building. Where you sell is a recipe for successin the in this industry. And so we are obviously very committedto making investments in North America.

That will that will help manufacture allthe vehicles that will be sold here. Nissan Motor SVP Joe Michael Barrspeaking there to Bloomberg. Let's get an update now on anotherblowout Saudi IPO. Shares in modern mills, Flour millsgained 30% in the first day of trading after a hugely oversubscribed publicoffering. It's the latest sign of strong appetitefor Middle East share sales. Let's bring in our equities reporterFarah Al-barnawi. So far, it seems this is anothersuccessful IPO and it's just proving the point that if you want to make money,just get in on the IPO in saudi is not.

The case.Essentially, vonnie i mean, the stock was at the maximum allowed in saudiarabia yesterday in its debut. This has been a common occurrence.We've actually seen most stocks in Saudi arabia jump by the maximum lot of themfirst day of trading and continue to hand investors these lucrative returns.This IPO, this company raised $320 million through its listing, but itactually had demand for $40 billion. Absolutely.That was oversubscribed by 127 times. So, absolutely, just massive demand fromfund managers. Even if other IPO markets open up.Fund managers are saying they will still.

Come to the Gulf due to its growthprospects, favorable macro backdrop and these very lucrative returns.Wow. And FARA, meanwhile, we're expecting aKuwaiti company to list in Abu Dhabi soon.Why are you paying attention to this? What are the details here?Well, because this Kuwaiti Kuwaiti company, Agility public Warehousing isactually looking to assist Agility Global and the Abu Dhabi SecuritiesExchange by May two. So this isanother Gulf company coming to the market here in Abu Dhabi.And Abu proved an in line dividend of.

Representing about 49% of agilityglobal. That's $2.6 billion.So not small, a small company necessarily.And Agility said that it will continue to be the controlling shareholder ofthis new unit. Agility, global controls a lot ofoperations and assets for agility such as Menzies Aviation and TristarTransport. So the logistics sector seems to begrowing on the Adobe Stock Exchange, and this gives investors further exposure tonewer and more developed sectors than what we usually see here in the Gulf.And we know you'll pay close attention.

To that.Bloomberg's Fara Alvaro Fara, thanks as always for joining us with an update onequities. Oliver.All right, Vonnie, look, we're paying close attention to another story that'sactually one of the top red stories on the terminal this morning, and that'scoming from this story about ozempic, which we've been talking about forseveral months. Of course, 2023 was a banner year forNovo Nordisk. But the interesting findings that thestudy recently came out with was that the drug, the Ozempic, could actually beproduced for less than $5 a month.

But a lot of people are paying upwardsof $1,000 a month. So this is not adding up here, Vonnie.Yeah, I mean, it is fascinating how little it costs to produce these drugsthat have been lifesaving, as you say, for many people.And we know that, you know, obviously us big pharma spends a huge amount onresearch and development and and then, you know, so the reward comes when adrug actually works and then they get the patent for, you know, a long periodof time. But you'd like to think that goingforward that, you know, perhaps these would be made more affordable.President Biden has done a lot of work.

On this and gained some traction withCongress. But, you know, the middlemen in thatscenario lost out a little bit. But you would like to think at themoment you can keep those numbers in the pharmacies, right?It's actually quite difficult to guess. You know, my brother is actually on itright now and sometimes he has to wait and, you know, it affects his body whenhe waits for the next installment. But you would like to think that, likewith the coronavirus, perhaps big pharma at some point would, you know, make thisavailable to more people for more time. Jen, I do want to say one more thing.We have somebody leaving the team today.

To go back to London.You in parts an ace, producer, subeditor and so much, much more.And we just like to thank him for all of his contributions over the last threemonths in Dubai. Thanks to you and.

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