Bloomberg Daybreak: Australia 01/24/2024

Welcome to DAYBREAK Australia.I'm Paul Allen in Sydney, where markets have just come online.I'm Annabel Draw is in Hong Kong. We're counting down to Asia's majortrading opens and our top stories this hour.Asia is set for a cautious Don after US stocks barely extend record highs.China's boldest moves yet to stop a market round facing a wall of skepticismfrom investors. Netflix rising after the bell on itsbest customer gains since the pandemic surge.Meanwhile, Texas Instruments gives another lackluster forecast.Plus, Bloomberg learns that Apple is.

Dialing back its decade long ambitionsfor a self-driving car as a release date continues to slip.All right. We're just open for trade here inAustralia, as Bill mentioned. And we're a little bit to the upsidehere in the very early going better by a 10th of 1%.Of course, we do have that staggered open here.So let's see how the morning unfolds. But following on from some modest gainsfor most of the US markets, not a great deal of movement in the bond space hereat the moment. Yields just creeping up ever so slightlyand the Aussie dollar has been moving a.

Little higher as well.Right now, 6583 against the greenback. We did get some data out of Australia ashort time ago due to Bank Australia PMI's that showed some improvement as well.The composite number 48.1, so it was still below 50, but manufacturing PMIhas moved above 50 a reading there of 50.3.That's a partial read for the month of January.New Zealand has been trading for a little while now.We got some CPI data out of New Zealand a little bit earlier too.Some encouraging numbers there, slowing to 4.7% on year in the fourth quarter.That was in line with expectations and a.

Slowing a bit sharper than the ANZexpected. So that suggests that the hiking cyclein New Zealand is probably over. We've got the markets in New Zealandmoving a little bit, a little bit to the downside.The Nikkei futures setting up for another positive day.The yen still very weak at one 4836. China futures in the green as well andof course bell we've seen Chinese stocks selling off very, very heavily.The seaside a five year low, although we are reporting that there's going to be a$278 billion stabilization fund to get on top of this market wrap bell.Yeah, well, Paul, big gains still.

We're seeing a pretty different storyfor US stocks because yesterday the S&P 500, the NASDAQ 100, hitting freshrecord highs into the close there. So in futures, you're continuing to seethat climb. There's the focus, of course, on the NewHampshire primary to wait for this as well.The bigger focus perhaps coming down to earnings.Pretty mixed bag. During the session, we had UnitedAirlines, Procter and Gamble among the gainers.But let's take a look at after hours as well, because there's a focus on onTexas Instruments, pretty weak forecast.

From the company.So you can see that stock is continuing to slip in after hours.Netflix, though, really the one to be watching as well because it's jumpingsubscriber growth that topped estimates. So very strong surge, best numbers we'veseen since the early days of the pandemic.The other one to watch as well was was its continued foray into into videogames. That's something to note, but also a newdirection of sorts, because Netflix acquiring those rights to to worldwrestling entertainment programming pool.Yeah Netflix very rich news flow coming.

Out of the moment as you mentionedacquiring those rights to WWE programming.This is its first big move into live events.Bloomberg Intelligence says its solid results show a new advertising tier andpage sharing initiatives are working as well.The senior media analyst Geeta Ranganathan joins us now.I want to unpack these results. So again, a strong fourth quarter fromNetflix. Question is going to keep this goinginto 2024. Yeah, it was a near-perfect scorecardfrom Netflix, whether it was the.

Subscriber momentum and all of the otherfinancial metrics as well. And going into 2024, yes, we aredefinitely going to continue to see growth.I think the one standout that we saw Paul from the earnings report was theiroperating margin guidance. And, you know, they were guidinginitially to about 22 to 23% for 2024, they actually moved that up to 24%.So just kind of goes to show that they have you know, all the stars are kind ofaligned for this whole Netflix bull thesis to play out.And that's exactly what I think we're going to see happen in 2024.Yeah.

And the big focus as well, Geeta was onon the the step that Netflix is taking in a bit of a new direction here.It came ahead of the earnings results but essentially this $5 billion bet onlive events. We heard from the Netflix co-CEO in theearnings call. Take a listen.Live event programming is something we've talked about for quite a while andthis has been in the works, so used to look at this as fits inside of our 7Billion programming spend. Now, I would not look at this as asignal of any other change or any change to our sports strategy.So acquiring those rights to raw to to.

Other programming from well, WorldWrestling Entertainment, is that something that helps Netflix, do youthink? I think it absolutely does.I mean, they've been kind of, you know, experimenting with different contentgenres. Live sports is not something that theyhad really ventured into so far. But I think now that they have anadvertising platform, now that they are selling advertising, you know, itdefinitely makes sense for them to go after sports because, you know, it'ssports, you know, that that content really plays well and it really attractsa lot of ad dollars and it attracts a.

Lot of advertisers to the platform.And, you know, what they need to do now is to kind of really invest in theircontent. And that is what this WWE deal reallyhelps them do. You know, invest in content, kind of getthe scale up of the ad based users and then be able to actually sell all ofthat ad inventory to the advertisers. It's not cheap content, though, is it?The WWE deal about $5 billion. Does this suggest going forward there'sgoing to be a risk of higher content spending from Netflix?Yes. So they would ask that question.I mean, yes, it is $5 billion over a.

Span of about ten years.So that's about 500 million every year. They say that it's actually going to bewithin their content budget. So this year they're projecting about7 billion in content spending. They did say that that will inch up, youknow, a little bit as we kind of get into 20, 25, 2026.But they don't they didn't, you know, project any massive increase inspending. And they said it's going to be in avery, very disciplined and very, very cautious and measured manner.Yeah, Well, investors clearly liking these results because Netflix continuingto surge in after hours.

That was data ran across an hour.Bloomberg intelligence senior media analyst there.Let's switch to to some way that's going in perhaps a bit of an oppositedirection. China planning to stem the current stockmarket rout and that that move or policy push is facing a wall of skepticism.We had earlier reported that authorities were considering a rescue package that'sbacked by $278 billion. Our executive editor for Asia markets,Paul Dobson, joining us now. Paul, we did, of course.Well, not, of course, but we did see a bit of a move higher, but for someChinese equities off the back of this.

But the big question of Mark really iswhether that can be sustained. Yeah, exactly.The sort of immediate knee jerk reaction is a bit of short covering, a little bitmore optimism, some more towards the market.Yes. Okay.There's signs that something is finally going to be done to help the market outat the very least. But after that immediate sugar rush andthe rebound that we saw yesterday, what investors now want to see is oneconfirmation of this news and see what else is there.And, you know, investors don't just want.

Supportive measures for the equitiesmarket, but they also want supportive measures for the economy, mostimportantly, the property market, in order to start getting consumerconfidence back in China, to break the kind of disinflationary mindset thatwe've slipped into over the past few months and to really kind of get growthspending going again. So that's kind of the longer term playthat investors are looking for. There is also, to be honest, skepticismabout how effective this can be long term.In any case, we've had many efforts by China over the years to try to prop upthe markets previously, and we found.

That if it's not supported by morefundamental changes, then after that sort of runs its course or even as it'ssort of dribbling through, the market can start to turn against China again.Yeah, Paul, you mentioned words like skepticism, confidence.It's interesting that about 60% of stocks in China are held by retailinvestors. And considering they have not had agreat experience with the property markets, how confident can they be thatthese measures are going to work? Yeah, I think winning over the domesticaudience is important in this because we've seen so many stock links, mutualfunds closing down, liquidating in.

Recent weeks and months that this addedto this selling pressure that we've seen on the overall gauge is people switchinginstead into the safety of government bonds or picking up a little bit ofextra yields in corporate bonds. Consumer is very burned.The man on the street is feeling pain at the moment, is looking for bargains,which is why we're seeing the price wars among the car retailers, among thesort of big retail chains as well.So turning that around, flipping that mindset and re-establishing thatconfidence is really the sort of key to solving this from a markets perspective.At least now, the authorities may think.

The growth is still going at 5% a year.That's fine by us. We're happy with this and we don'treally need to do more. And so that's the kind of conundrum ifthey're if they feel that really there isn't a need to to to to sort ofpropel markets would propel consumer confidence further at this point, thenprobably this stimulus will only last for so long.All right. Executive editor for Asia Markets, PaulDobson there. Well, a new poll suggests Donald Trumphas gained most from the exit of Ron DeSantis from the Republicanpresidential race, opening a 22 point.

Lead over Nikki Haley.Voting is now underway in New Hampshire's primary, where Haley's thelast major challenges standing between the former president and the party'snomination. Bloomberg's political news director,Jodi Schneider, joins us now from Manchester, New Hampshire.So, Jodi, why is the New Hampshire primary so significant?And how unusual is it for this to be effectively a two person race at such anearly stage? Yeah, Paul, it's very unusual for it tobe a two person race. I think the last time there were aboutten people in it at this stage.

So Nikki Haley had said she wanted a twoperson race. She's getting a two person race.But of course, with the challenger like Donald Trump, it's a it's an uphillfight for her. We've heard today reports of prettystrong turnout, particularly among more moderate and independent minded voters,which will help her because those are the kind of voters that she appeals to.And she also appeals to voters who don't want to vote for Donald Trump.So we will see the polls close. All the polls close here in more than anhour, and we will then get to start getting the results.She needs to have a very good night.

Tonight to make it to really have thatkind of momentum behind her that will continue to make this a successful or atleast an interesting two person race. She said today she was going to stay inthe race to South Carolina, that she will not be dropping out, althoughothers who have dropped out have said before that sometimes just days beforethat they were going to stay in the race.Yes. So what do you think's going to reallyconstitute a success for Nikki Haley tonight?What's sort of the bottom line going into it?Maybe she doesn't win if she gets close.

Is that something that's still seen as apositive or an off? Well, if she wins.Yeah, if she wins, that certainly sets up a whole different dynamic.And that really. Kind of makes this you know, thiscontinues this battle with Donald Trump. And of course, that's what her campaignhelps. New Hampshire has is famous for giving,for surprising, for really having a different result than the polls hadshown. However, some analysts we spoke to todaysaid they think if she's obviously, she'll be second if she doesn't win.But then if she comes in a strong.

Second, say, within five percentagepoints, that that's a good showing and that she can say that shows that she canbe competitive to Donald Trump, that he is not the effective nominee at thispoint. If she does, she trails him badly insecond place. That isn't a good sign.And the next big race is South Carolina, which of course, is her home state.But Donald Trump is already doing very well there.Yes. So, Jody, what happens after tonight?As you mentioned, Nikki Haley says she's going to stick around until SouthCarolina regardless of what happens.

But, you know, at least one of thesecandidates has some legal trouble, doesn't he?Yeah, he does. And Donald Trump does face legaltroubles in a number of jurisdictions in federal and state court.91 indictment counts. But he has also been able to kind ofmake that part of his campaign. He is basically goes from the campaigntrail to the courthouse pretty seamlessly at the courthouse, sayingthat he is being targeted, that this is a Justice Department controlled by JoeBiden that is trying to keep him out of the race and doesn't want him to bepresident.

And he fundraises off of that.So, so far, we haven't seen the his legal troubles really affecting hispopularity with his base, although in New Hampshire, we've talked to somevoters who said that if he were to be convicted of a crime, that they mighthave trouble with that. So I think that's where that will startshowing up more. But what's next is the next big race isSouth Carolina. And then we'll have Super Tuesday inMarch where a number of states vote. Yeah, but polls closing for this thisprimary in just under 2 hours time. So that was our Bloomberg political newsdirector, Jodi Schneider joining us from.

New Hampshire.And we're going to have special coverage of the primary taking place beginning at8 p.m. Eastern time.That's midday in Sydney, 9 a.m. in Hong Kong.So special coverage coming up later. Still ahead, sources say Apple ispushing back its self-driving car ambitions as it continues to delay alaunch date. Plus, we're going to hear from Evereston why they think mega caps have returned to the driver's seat.This is Bloomberg. You're watching DAYBREAK.Australia taking a look at some of the.

Big movers in the session.Intraday because we're seeing futures pushing higher, but the focus reallycoming down to earnings and and what companies were signaling about theoutlook. So united for instance one of the biggainers posting an outlook that beat Procter and Gamble as well that theirprofit outlooks really helping offset the slower sales growth that we'reseeing for the company. So both of those.Among the big gainers intraday. So the flip side, we had the likes ofJohnson Johnson for instance it's it slid device margins dropping drug salesas well as seen falling 3 a.m.

That's that's the most that we've seenit down in almost five years and it was a disappointing outlook for the companyafter hours. Again, it's a pretty mixed bag comingthrough. But two of the ones we're reallywatching in particular, firstly, there's Netflix really rallying because its usernumbers indicating further support for the company.The most subscribers we've seen signed up to the streaming giant since the daysof the pandemic, the early days as well. Texas Instruments, meanwhile, a bit of aweaker forecast. So one to really be watching, especiallywith those chipmakers that are listed.

Here in Asia.But Nasdaq futures, again continuing to push higher.So it does indicate just how much optimism is already being priced intostocks. Let's get more on that now.Our next guest says the recent moves in US equities show mega caps are back incontrol, particularly tech. With us now is Dana DeJoria, co-CEO atInvestment. Donna, lots of moves we've seen reallystarting back in October of last year. Do you think that it's going to reallylive up this earnings season to sort of some of the hype and the positivitythat's already been priced in at this.

Point?Well, I think so far we're seeing that maybe we're not getting that right.So, I mean, we're only a week in. It's kind of early days to to makepredictions, of course. But I would say that thus far, at least,what we've seen is maybe a little bit more lackluster than where we startedthe year growth expectations for the S&P 500.Not to say we're not going to get, you know, 20, 23 double digit, you know, atthe end of the year. I think that's a foregone conclusion.But, you know, not not certainly not surprising greatly to the upside.And, you know, only a few sectors kind.

Of passively maybe beating where theestimates were in January. So I think, you know, it's not a badearnings season by any stretch that's in front of us, but it's not anything thatsort of greatly surprising people in a positive way.And if you think about the fact we came into the year with pretty high earningsmultiple in the S&P 519 times, you know, there's not a lot of room in there.Right. In the in terms of the pricing foranything other than, you know, fantastic surprises to kind of positively impactthe market. Yeah.So when you sort of couple that and then.

You've also got expectations for Fedrate cuts that are being pushed back. What does that tell you about thetrajectory of the bull market that we're seeing then?Is it something that's going to start to fade perhaps?Yeah, I think there's a case to be made for that, for sure.You know, we did we came into the year with a lot of applicants, right.And so, you know, again, multiples of being where there were and and you'reright on it. Right.Rate cut expectations have dropped pretty dramatically.We were looking at 60 plus percent, a.

Rate cut likely in March.And that's just come down, you know, pretty significantly, which shouldn't bethat shocking. Right.I mean, the Fed, you know, notwithstanding some of the richnessthat we heard at the last meeting, they have expressed the desire to kind ofstay higher for longer. And when we look at what's going on inthe economy, certainly unemployment, inflation's kind of coming in as a mixedbag, you know, a little bit maybe higher than expected.But core kind of where we expected PII, a little lower, I think, you know, to acertain extent, the Fed is empowered to.

Sort of just sit where they are andthat's what they've said that they wanted to do.So I don't think it should come across as such a surprise to markets in March,but it does seem to be, you know, taking a little bit of the edge off the theexcitement we entered the year. Dana, in terms of markets, we have seentech leading the gains again. Small caps continue to lag.Again, I mean, how long do you see this trend continuing before this rallystarts to broaden out? It's all around multiples.So first of all, we have to see where tech comes in and earnings.Right.

I think there's you know, it's sort ofthe this asymmetric possibilities, right, with tech.There's this possibility that you've got great news around AI that kind of blowsout expectations and you really don't have that, you know, that kind ofpotential upside with other sectors. Right.There's there's nothing kind of hovering that could potentially, you know, reallyboost other sectors the way some of the tech companies could come in and talkabout AI again and and we could have this massive boost.But I do recommend tilts towards small caps.So you mentioned small caps.

We know December small caps came roaringback. They've got a lot of the return thatthey had gotten for all of 2023. And I think there's a very strong caseto be made that whether you think they're going to wane in the short run,they do over the longer haul, particularly if you stay away from thevery low profitability kind of growth. This lottery ticket like small capstocks, you stay away from that area of the market.Small caps do tend to outperform over time.And they're nice also particularly small value.They're a nice hedge against inflation,.

Which we don't we really don't know forsure that we've completely conquered. Right.We know that inflation tends to come in waves.So I think not not that you're going to have a small cap portfolio, but whenyou're thinking about tilts in the portfolio, having making sure thatyou're full market, that S&P is not your entire holding, I think makes sense.Just very quickly, Dana, 30 seconds. What's your cash allocation?I think cash should be coming off a little.Obviously, you hold what you need to hold, but I think a lot of people onmaybe way too much cash last year, they.

Saw the opportunity lock in great rates,but it didn't come anywhere near what equity markets did.All right, Dana, Daria Cose, CIO at Invest Now.Thanks so much for joining us. We have plenty more to come on DAYBREAKAustralia. This is Bloomberg. Okay.Let's take a look at how we're doing on markets at the moment here in Australia.Was served modest gains to the upside, about a fifth of 1%.Gold miners doing pretty well in the lithium miner line town.Resources also in positive territory.

After having a rough week or so.We're just getting some data out of Australia as well as the Westpac leadingindex for December. A slight contraction there, very slightthough of 0.04 of a per cent reversing the gain for that index that we saw backin November. The New Zealand stocks, meanwhile, arebacking off a little by a third of 1%. We had CPI numbers out of New Zealand abit earlier, inflation slowing pretty sharply to 4.7% on year in New Zealand,although that was in line with expectations.Nikkei futures looking kind of flat at the moment.The Nikkei has been performing very.

Strongly of late, as we know, andE-mini, S&P futures trading modestly in positive territory at the moment.Also now let's get back to one of the top stories out of the US in terms ofearnings. The Netflix very strong report signingup more than 13 million customers in the final three months of 2023, and that'sas best quarter of growth since viewers were stuck at home in the early days ofthe pandemic. Let's bring in Jamie Lumley now, senioranalyst of Third Bridge. Jamie, thanks so much for joining us.Just take a look at some of the highlights there.Strong subscriber growth, 13.1 million.

Signups.That was a beat, the beat on sales as well.What were the key takeaways for you? So the key takeaways on this is reallythat Netflix knocked it out of the park. I mean, if we break down the varioussets of numbers here, Netflix saw double digit revenue growth.It saw an operating margin which other streamers are going to be envious of.And in that subscriber number, as you highlighted, this is one of the bestquarters in years seeing growth not only at its core U.S.and Canadian markets, but also in Europe, Asia Pacific, Latin America, allseeing remarkable year on year.

Improvements and also demonstrating thatkey initiatives such as the launching of the ad supported tier and also thecrackdown on password sharing has really taken effect for the company.So it does beg the question, though, where's the growth going to come from infuture quarters? How does Netflix keep this momentumgoing? Do you think we're going to see perhapssome price increases? Well, we think about pricing.Netflix looked at it in a couple of different ways.Last year. There was initially the crackdown onpassword sharing in around and of Q2,.

Early Q3, and that was viewed in someways as a bit of a price hike by management or another way to do that.And then the announcements in Q3 that they would be driving up prices.So this is something which could perhaps temper growth and certainly more costconscious customers are maybe less inclined to go with some of those plans.But also, let's keep in mind the ad supported tier at seven bucks a month isa fairly competitive price level. If you think about that versus a numberof the other offerings in the U.S. from Disney, Warner Brothers, Discoveryor Paramount, for example. So while there could be some, you know,impact from more price hikes, given.

What's already happened in the state ofthe landscape, it's not necessarily going to be a major headwind for thecompany going forward. You mentioned the crackdown on passwordsharing and how that sort of helped boost subscriber numbers, But how muchmore can Netflix mine that sort of revenue strategy to do as well?It's a great question. And if we think back to before Netflixstarted this off, they estimated that there were 100 million households whichwere sharing Netflix accounts. And if we look at the growth numbersover the past two or three quarters, I've still hasn't gotten close to the100 million total.

What we've been hearing here at thirdBridge from the experts we speak with is that Netflix could likely in the mid tolong term tap into 50% of those households.So if we think about the progress the company has made, it's still onlyscratching the surface in terms of that subscriber growth potential.And then there's the question of other revenue streams.You know, one of them is, is the gaming offering.So how much is Netflix really committed to that area, do you think, so far?Gaming is definitely interesting because if we think about this and leadershiphighlighted this during the earnings.

Call is the fact that gaming stillrepresents a very small fraction of overall spend in Netflix and also isstill relatively low in terms of the percent of its base which engages withgames. That being said, this engagement hasbeen growing. It tripled in 2023, although it iscoming off of a relatively limited base. Those are still remarkable numbers.What we've been hearing from our experts is that it's unlikely Netflix will makeany major moves in gaming in the near future, preferring to either buildinternally or grow through smaller acquisitions, picking up small studiosversus something major and really.

Continue to figure out the best ways tocontinue to engage its base while also capitalizing on the IP.They have to create just another way to monetize, you know, the hit shows andfilms that the platform brings to people.Well, Jamie, we're seeing that Netflix rising after hours about 8% over thepast year. Netflix shares better by 35%.How much more upside is there here? Well, if we think about where thecompany is today, it definitely seems to have picked up a lot of momentum interms of revenue growth in subscribers at the end of 2023.As we head into 2024, if we look around.

The industry, profitability is still keyand Netflix is definitely far and away above the competition.Players like Disney, Warner Brothers, Discovery,Paramount are still trying to crack the code on getting profitability to work,whereas Netflix is there and is working on optimizing their margins as they lookforward to changing their content mix, moving more from their traditionalscripted shows into live programming, changing how they're thinking abouttheir investments in content. This could have an impact on their coststructure. So we think about what's in store forNetflix.

There are still definitely levers thatthey can pull to really to continue to improve their bottom line, improve theirpositioning as a company. Yeah, you mentioned live programmingbecause that was the big news ahead of the earnings.It was that they were paying $5 billion for RAW as well, as well as otherprogramming from WWE. Was that a prudent decision, do youthink, to to again, as you said, to sort of diversify its content or do you thinkit's something that's a very, very expensive price tag?So the WWE is definitely interesting and it's a big deal.$5 billion over ten years starting in.

January of 2025.But also on top of that, it's getting international rights.It has rights to a couple other different shows from the WWE and it is alot of programming. It's weekly shows for entire year.It's many hours of content. I'll be able to break into his platform,which is also quite different from the type of content they have.So this from Netflix standpoint, could be an effective play to both broadentheir appeal to an ever widening breadth of people while also finding new ways toengage its existing customer base. Because at the end of the day,subscriber growth is certainly.

Incredibly important for Netflix.But keeping the existing subscribers, they're not having them become serialturners switching in and out, depending on whether their favorite show is on theplatform. Having this sort of recurring content,this live must watch TV is definitely something which Netflix thinks will be agood investment for the future. All right.Thanks for your insights. That was Jamie Lumley, senior analyst atThird Bridge, where we also heard from the WWE president Nick Khan about that$5 billion deal. He says Netflix has bet on wrestlingwill benefit both companies.

We're pleased with the deal and we lovethe fact that Netflix was willing to take a bet on us.As we know, they had said previously that they were not into sports rights.The good thing about WWE, it's sports entertainment, as you said before thequick break there. So we're an entertainment property asmuch as we are a sports property. 52 weeks a year, live consistentprogramming, an audience that is actually quite global.If you look at India, India is not part of this deal.But if you look at India, where the second most popular sport in India, ifyou look at the United Kingdom, where.

The fourth most popular sport there,this deal will take effect in the UK. So in addition to the United States, itallows us to gain even a greater global footprint as we look to expand thebusiness. Well, Nick, I want to talk a little bitmore about the decision to go with Netflix, go with the streamer versusstaying with a Comcast, for example. Did this purely come down to numberswhere you were going to get the better deal, or is this in effect a bet onwhere the future eyeballs are going to be?Well, look, we continue to love NBCU. We have Smackdown on USA premiering thisOctober.

There we have our premium live eventsformally our pay per views like WrestleMania on Peacock exclusively inthe United States. They've been tremendous for us with Raw.It was yet another test of someone new in the space, obviously an establishedstreaming entity, the streaming entity, if you will.It was a good bet by us and we think a good bet by them.Let's talk about ad pricing a little bit more here.Does this give you greater ad pricing power, this deal?We think so. Look, you've seen what Amazon has beenable to do on their ad supported tier.

Netflix is going to have great successin that space. WWE, again, 3 hours a week on RAW everyweek allows Netflix to monetize this deal in the advertising space in a waythat has not been seen before in Net Raw has this kind of super loyal and sizableaudience. But there must be a part of this dealwhere you're like, okay, we need to think about the future and growing a newaudience. And I wondered if there's any terms inthe deal where Netflix goes away and produces a behind the scenes kind ofdocumentary exclusive to Netflix that introduces WWE to that new audience.Think about like, what am I thinking of?.

Drive to Survive and Formula One and thesuccess that that had bringing a sport to a new audience.It would be a mistake by us at WWE to not do that with Netflix.So assume that what you said is exactly what we're all thinking.We being Netflix and WWE, you saw where Drive to Survive did for Formula One.As you just mentioned, we think the WWE audience are already big on a globallevel, only gets bigger with a show like that.And that's WWE. President Nixon there speaking withBloomberg's Katie Greenfield and Ed Ludlow.Now you can watch us live and you can.

See our past interviews on ourinteractive TV function. TV go.And there you can also dive into any of the securities or Bloomberg functionsthat we talk about. And you can become part of theconversation by sending us instant messages during our shows.This is for Bloomberg subscribers only. You can check it out of TV.Go. This is Bloomberg. A group representing oil and gas tankerowners say the US has advised ships to continue to transit the Red Sea to do sowith great care.

And that says the US and its alliescontinue to strike at Yemen's Houthi militants.Glenn Beck, Michael Heath has been following developments and Michael ofus. Suffice to say, despite the securityoperations going on at the entrance to the Red Sea, it doesn't seem like it's awhole lot safer there. No, and I think I'd be the shipping lineis that we're reporting a very skeptical of the US suggestion to to exercisegreat care. They just avoiding it altogether.And frankly, outside of the oil tanker industry, which is obviously seeing hugeincreases in fees here, it's not really.

Good news for anybody here at the US andthe UK have conducted some pretty strong strikes on areas, they've targeted,underground storage facilities and these sorts of things.But again, as we've been saying in recent days, it's very, very difficultto get a handle on this. They don't have boots on the ground.They're trying to do it all via surveillance.These guys are pretty nimble. And the other side is the Houthis arebeing supplied by Iran, and it's quite difficult to interdict those ships.The US actually lost two commandos when they did interdict a supply ship a fewrecently this month.

So again, it's it's a real navalhaystack kind of thing. And in the meantime, trying to getshipping through there. I mean, sensible shipowners, as they allare basically avoiding it where they can.And it's not just the sort of present day shipping that is really at riskhere, because we do understand that the US did have a sort of plan in place orprojections to try and sort of counter China's Belt and Road initiative.And we also understand that that's now been sort of stalled or pushed backquite substantially. Yeah, that's right.And and I mean, it's a it's a really.

Interesting initiative.The US and and Europe have to have this corridor basically be a rail corridorlinking Europe to India and it would go across the Middle East.And this sort of highlights the reverberations from this conflict.You know, Israel, very small country, Gaza even smaller.Just just the global implications of these sort of issues where it feeds intoUS-China competition that obviously try to build a railway or road connectionsacross the peninsula now is out of the question with so much violence around.But also the whole project, which, as you said, was to counter China's Beltand Road.

It was also premised on an incentive toSaudi Arabia to recognize Israel's right to exist and to set up diplomatic tieswith the to that that that corridor would go across both nations.Now, obviously, Saudi Arabia would have no interest in that while this fightingwith the Hamas Israeli war is going on while the Palestinian civilians aresuffering. And while there's no real prospect atthis stage for a Palestinian state, now, Saudi Arabia is ready to open a lot ofdoors on these issues if that comes to pass.And the US is obviously very keen for it to happen, but Israel has to be on boardas well.

So yes, this really interesting projectto counter China and to open a new new trade route, a new direct route is onice at the moment while this conflict goes on and until we can get some sortof political settlement in the end as well.Yeah, certainly need a lot more clarity and a resolution of some sort.So that was Bloomberg's Michael Hayes there.Well, let's take a look at the other geopolitical stories we're trackingtoday. Turkey's parliament has approvedSweden's NATO membership, and that leaves Hungary as the lone hold out tothe alliance's northern enlargement.

Turkish President Recep Tayyip Erdoganhas already backed the move and is expected to give final approval.It puts Sweden on the cusp of becoming the bloc's 32nd member after a change inits defence policy following Russia's invasion of Ukraine.Finland joined Nagato in April. A Russian politician campaigning to endthe war in Ukraine has collected the 100,000 signatures required to challengeVladimir Putin in this year's presidential elections.Russian authorities still need to approve Boris suggestions campaignapplication before he secures a place on the ballot.Putin is seeking a new six year term in.

Elections to be held in mid-March.Israel and Hamas have reportedly agreed in principle to exchange Israelihostages for Palestinian prisoners during a possible month long cease fire.Reuters cites unidentified sources saying a deal is being held up bydifferences over a permanent truce to end the war.The report says civilians would be freed first, followed by soldiers.South Africa's justice minister says upcoming elections have nothing to dowith his country's move to take Israel to the International Court of Justice.Israel has denied the allegation that it's committing genocide in Gaza.Ronald Lamola, meanwhile, told us the.

Case is not about scoring politicalpoints. There was no political consideration.We have been winning elections and we have been campaigning on thismatter of Israel and Palestine for many years.We have always believed in a two state solution.But why? Why now?I mean, why escalate this? I've already told you it's not now.We've been doing it all along. Even former President Mandela has doneit. So it has been a longproject in the campaign.

As you've said yourself, it's a longstanding relations between the ANC in the end and India and peoplewho see the organisation of Arafat in Palestine.So there is no consideration of elections at all.And and the fact is that there is an ongoing genocide which is urgent.We should need it to be attended to. It has nothing to do with the elections.We have had to. We are campaigning here.And so the photographs true, and we do the number of issues, service deliveryand so forth, obviously even international issues.But the matter was taken to the court on.

The basis of principle and on the basisof our signatory to the Genocide Convention.And I and I also want to bring up Minister, because there's been a lot ofopposition to this case in particular, we heard from the United States thatcalled it unfounded, France saying that it crosses a moral threshold.Israel, of course, in opposition to it. I mean, were you surprised that just.A level of criticism that you got to bringing this case forward?Yeah, we're not really surprised. You're not only the thing that surprisedus is that it was not dismissed by substance, particularly by the U.S.You can't dismiss an 84 page document.

With just three lines that there's gotno substance, it's meritless and so forth.They need to provide the compelling argument, provide substantive documentsso that everyone can be able to see what is the point, what is the argument.It can also be being gauged upon by both academics, intellectuals in this piece,even the court itself. So anyone who has got a different view,that is what must do and that is what South Africa has done, will follow therules of the court with a well-detailed forensically submitted submission.That is what we expect. That will be what shows of respect toother states.

You can't just dismiss it with the threesentences. So the intellectually engaged willcontinue to engage with all the role players in this space, and we believethat the superior logic is what MUSC must provide.That was the South African Justice Minister, Ronald Lamola, speaking withBloomberg's Jennifer Zubaida. Let's take a look at some breaking datathat just came out for Japan. We've had the trade balance numberscoming through from December and we saw a significant narrowing for the tradedeficit. So coming in at ¥62 billion in December.That is significantly lower than what we.

Had in the month prior.Here exports, meanwhile, we saw those rising at nearly 10% on the year.So an increase as well from November. And then also we saw imports incontractionary territory a bit, but narrowing from the prior month.So down around 7% was down nearly 12% in November as well.Really, that focus on semiconductor exports providing perhaps a little bitof a boost hit the numbers. More ahead.This is Bloomberg. We have learned that Apple is dialingback its decade long ambitions for a self-driving car and delaying the launchfor it.

For more, let's bring in Bloomberg'stechnology reporter Mark Gurman. So Mark, Apple in reverse on the car.Why, that's a good one in reverse on the car.Yes. Sort of their initial plan was torelease a level four car. Right.An autonomous vehicle that can self-drive with level four capabilities.That means the car can drive almost entirely on its own in almost anycondition. They're scaling back.They're moving to something called level two plus.That's in line with what Tesla has.

Today, maybe a little bit better.And they're doing that because getting to level four, getting to these moreadvanced levels of self-driving and self-driving autonomy, it's verydifficult, very challenging. So they're scaling back the ambition tofinally get a car to market. The other thing they're doing is they'redelaying the debut of the car they had planned most recently to launch itaround 2026. That's now going to be between 2028 and2029. So a big a bit of a big revamp or shakeup here for the car project and Apple. If they're delaying the launch to to2028, 2029, as you said, and if it's.

Going to have this level two plus planthat's sort of similar to the capabilities of Tesla today.Why does someone want an Apple car in six years from now?Five years? It's got those capabilities.Yeah. So there's going to be a big focus onsafety systems, a big focus on interior and exterior design that Apple believeis going to be far superior to what Tesla other car companies are offeringat this point. It's going to be a bit of a higher endvehicle. And you're also talking about a muchmore advanced infotainment system and.

Internal systems that display the gaugesand what have you is going to be much more advanced than what you're seeingfrom Tesla. So there are going to be some keydifferentiators here. And there's a belief that 20, 28, 20,29, four or five years from now, you're not going to see level four autonomy orlevel five autonomy being a big part of daily conversation, being a big part ofdaily driving. But the belief inside the company isthat level two plus is actually going to be where the industry lands in fouryears from now. All right.Great context.

That was Bloomberg's tech reporter, MarkGurman there. And counting down to the open for Tokyo,Korea. Some of the stocks are going to bewatching while chip makers and suppliers of Texas Instruments.That's after the US company's disappointing revenue forecast.So it tells us demand perhaps a little bit sluggish.That's one group. Plus we can also take a look at Asianstreaming related companies and producers of Korean shows in Focusfollowing Netflix posting its best subscriber growth since the start of thepandemic.

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