Bloomberg Spoil of day: Australia 01/25/2024

Welcome to DAYBREAK Australia.I'm Paul Allen in Sydney, where markets have just come online.I'm not about drool, as in Hong Kong. We're counting down to Asia's majortrading opens. The top stories this hour, A mixed openahead in Asia after Wall Street closed off session highs.Chinese market set for a further boost after the Pboc's surprise announcementof a reserve ratio cut. Tesla shares slipping in late trade asit warns of notably lower sales growth this year as fourth quarter earningsmissed expectations and chip demand set to propel S.K.Hynix to its strongest quarterly sales.

Growth in almost two years, with resultsdue in the next few minutes. Or let's get straight to some breakingnews out of South Korea. This GDP numbers for the fourth quarterand coming in line on quarter, 6/10 of 1% growth on year 2.2% growth.That was a narrow beat. But South Korea's GDP for the entiretyof 2023 was 1.4%. So that's very much in line withexpectations as well. South Korea, of course, a very importantbellwether for the health of the world economy.And it was last month that the US overtook China as South Korea's mostimportant export destination as well.

So the GDP numbers coming in that verymuch in line with expectations. South Korea, of course, having aparliamentary election in April as well. Okay.We had the one last trade of 337. So we'll be keeping an eye on thecurrency a little bit later on as that begins trading.But let's take a look at what to expect for markets around the region.Not a huge amount of change for the Aussie.Ten year yields creeping up just a little bit, 4.276 yields creeping upacross the curve. In fact, the Aussie dollar has beenpretty stable the past few days at that.

$0.65 level, just below $0.68 U.S.And we've just opened for trade here in Sydney as well.The ASX right now just in the green by a few points, but as we know, staggeredopen here. So we'll get a better gauge of what'sgoing on in a few minutes time. New Zealand, meanwhile, been trading fora little while. That's up about a 10th of 1%.Nikkei futures slightly in negative territory, the yen strengthening just alittle as well, one 4750 against the dollar at the moment.Chinese stocks had a very good day on Wednesday.So we'll be watching it again today, of.

Course.BELL The market really liking this narrative coming out of policymakers.But the key question is, can this rally be sustained?Yeah, that's right. We haven't really seen policy measureslike this leading to substantial gains in the past.But we've got a couple of movers as well to check in on because of big WallStreet earnings after hours today. So Tesla, you can see here droppingnearly 5% at this point. And if one car sells, they're going tobe lower over the course of this year. We don't know exactly how much lower,but Tesla is saying it could be pretty.

Notable.So fourth quarter profit and sales also missing expectations from Wall Street,IBM, It's quite a different story for this company.You can see there the shares that are moving higher here.Good outlook for revenue, cash flow into 2024, some job cuts, but just only a fewfrom the company as well. It was seeing strong demand and that'sgrowing by the day. So let's take a look at how that sort offeeding into the futures landscape. We just had those coming online for USstocks and you can see here some pretty flat moves overall.But we did see stocks still continuing.

To trade around record highs for the S&P500 tech stocks as well. China shares, you mentioned those movesthat we saw in the CSI 300 Hang Seng yesterday.And we did actually see that translating across to the Wall Street sessionbecause the Golden Dragon index, they're up 1.8% fall.All right. Just want to get you across some morebreaking news on the Bloomberg at the moment.A Bloomberg scoop here. We're hearing that David Ellison hasmade a preliminary offer to buy National Amusements Inc.This is the holding company of the.

Redstone family.And this would be a way to take control of Paramount Global.Of course, that's a media giant that owns MTV and Nickelodeon as well.Now, this is according to people familiar with the matter where this togo ahead. It could have quite a complex structure.A paramount share price, of course, has been slipping a little.The stock market value currently about $9 billion.So we do have word, though, that the Ellison's might have secured theblessing of Warren Buffett. This, again, according to peoplefamiliar with the matter.

That's a story to watch Bill.David Ellison there apparently making a preliminary offer to buy it, NationalAmusements, Inc., as a way to get control of Paramount Global.Yeah, certainly seem to be tracking. But the top story this hour and over thecourse of yesterday, as well as China cutting the reserve requirement ratio bythe banks by half a percentage point in early.Library. The PBOC governor made the announcementin a press conference on Wednesday, and it's really been a very rareforeshadowing of policy change. There is still sufficient room forChina's monetary policy in the next.

Stage, and we will continue to strike abalance between short term and long term between stable growth and riskprevention. Starting from fifth February to fifth,we will lower the R by 0.5 percentage points so as to inject 1 trillion R&Dliquidity to the market. Our global economics correspondent and ACurrent joins us now. And I think perhaps to start off withthe significance of this sort of cut, becausesaying it or signaling it this much in advance maybe tells us that there's justno other effective tools that are available.Well, it certainly does indicate a new.

Sense of urgency among the policymakersin Beijing. And, you know, you made the point ofmaking that move on a trip already announcing in advance that in itself isunusual. It's a it's a larger cut than theynormally would make to go by 50 basis points.There were some other measures that the authorities are talking about as well.For example, make it easier for a corporate developer, for propertydevelopers to get access to their financing.Tokyo Financial links with Hong Kong. So there's some, you know, trying tochange the mood music and clearly it's.

Having some impact.But to your point, though, you know, I think that the entire world has beenlooking at China and wondering when and how they might pull a circuit breakerfor the economy, for slow down for the property market and when they mightstart to turn things around. I don't think anyone's especiallyconvinced that this kind of move will do that.You know, I think most people would say to you, short term interest rates aren'treally the problem with China's economy. Global sentiment is negative.Foreign investments, weak global capital is leaving China at a fairly decentclip.

And I think these this this move, whatdo people see may calm things a little bit on the side of the Chinese New Yearholiday. It may help sentiment are in themargins, but I don't think it's going to do much for the structural problems.And that's why I think a lot of analysts are eyeing the news out of Beijingovernight. Yeah, and it keep cycling back to thisproblem. Is this the right medicine for forwhat's going on, for what appears to be a crisis of confidence?What would the right medicine be? Well, I think the U.S.governor made some points as well.

He spoke about that.They still have fiscal room, for example.I think a lot of observers looking at a China story would zero this in on numberone, the property sector on a real estate slowdown.That's really what's dragging on everything else, dragging on theconsumer story, dragging on sentiment. So they've got to go in there and gohard in terms trying to fix that. And of course, one way of doing that ison the is on the fiscal side or the central government intervening to borrowand spend more to support projects and to support to get activity up andrunning and get animal spirits motoring.

Around the economy.So I think the the global audience are looking for solutions from the fiscalside, but the authorities are clearly being very conservative in theirapproach. They're not yet willing to down thatroad. Obviously, we know they've been burnedby the debt build up in the years after the financial crisis and everythingelse. They haven't really fully given up thatnarrative just yet. So I think, you know, for the rest ofthe world, looking at China saying, when's it going to turn around, whenwill unleash the kind of stimulus need.

To do so?I don't think the measures so far will convince that audience that they will.And I think a lot of focus will be on now what kind of fiscal steps they dotake over the weeks and months ahead. That was our global economicscorrespondent in Dakar. And then let's get to some breaking newsnow on Boeing, because they've got some lines that are disturbing from the FAAhere. This is relating to to Boeing's maxproduction. We understand that that has been haltedby the FAA and that includes for the 7379 max aircraft That, of course, didhave that recent Air Alaska incident.

The reason for that hold, well, the FAAsays that it needs to increase oversight of Boeing's production lines.It's saying that the quality assurance issues that they've seen so far areunacceptable. We do have a statement just coming outfrom the company, and this is where it's coming from, saying FAA telling Boeingthat it won't grant any production expansion of the max, including the 7379max at the regular site, saying that in a statement.So really want to be watching because Boeing has been making a lot of effortsto try and emphasize that focus on safety, that focus on quality.But still, Paul, clearly a long way for.

That company to go in that quest and thestock that you can see slipping in after hours.Yeah, Let's get back to these the story out of China about the looming triplelock cuts and whether or not these policies are going to make anydifference. We're joined now by Carrie Craig, globalmarket strategist at J.P. Morgan Asset Management, joining ustoday from our Melbourne studio. So, Carrie, a 50 basis point triplelockup foreshadowed. Is this the right medicine, this failurewith confidence sort of pile back into China now?No, I don't.

Good morning, Paul.Well, I think the the urgency around the move, the fact that we saw that largermove coming earlier than expected does suggest there's still policy support forthe economy and for the market. I think in our view is that we've seenincremental policy changes come through over 2023.We had expected those to improve the growth outlook for China this year asthey generally feed through the economy and this will give a little bit moreboost, but it's probably not the right thing to really shore up confidencearound the property sector as much. There's still a huge focus on theproduction side of the economy rather.

Than thinking about the consumer andconsumption. I think that's where the real focus liesto try and reignite that consumption growth and the economy and see thosebetter growth rates really feed through and lift private investment.So in terms of that, what sort of announcement would you be looking for togive you more confidence than China markets?We want to see more action around actually supporting the property sectorin general. Thinking about that balance betweenlifting home prices. That obviously feeds the wealthnarrative for many homeowners and also.

Trying to balance that out with makingthem sort of relatively affordable. We want to see them remove a lot of therisk around the failure of completions of those existing projects that comethrough. And also thinking about the fact that wewant to actually see that consumption reignited sort of release all thosebuilt up savings that consumers in China still have that haven't had the need toreplace them. So I think more focus around theconsumption really linking to that wealth effect around the property sectorwould be something that we would be looking for in terms of that much moresustainable growth outlook.

For now, it seems there is more scope onthe fiscal side, but a lot of it's going towards addressing some of those issuesaround local government financing and thinking about that infrastructureinvestment a little bit more rather than thinking about the consumer.And what are the sorts of fiscal policies that you want to see inparticular to try and lift consumption? Well, we actually have seen quite a bigmove on the fiscal policy. We sort of thought out of cycle movementin terms of raising that debt to GDP ratio last year.I guess the market's just been a bit underwhelmed that we haven't seen a hugenumber being announced by China.

It's been more these incremental policymeasures and they will add up eventually leading to that growth.I mean, they did announce a growth figure that was probably a little bithigher than we expected for the full year when they came out their GDPfigures. But we want to see a more around, Iguess, a larger number being announced to really address the market concernsthat China has the capacity and willingness to to really shore up theeconomy. Whereas I think that's what's beenlacking right now. And again, evidence from the flows outof investments in China over the last.

Few months that.So China not perhaps the preferred market really for any investors at themoment, but where are you looking to in particular or is it any specific sectorinstead? I think for us, China is still worthwatching given the valuations have come down so far and there could be anear-term rally if we do see further policy announcements coming through.We still think about the longer term potential for the Chinese growth morebroadly and we think about asset allocation this year.We are seeing an environment, we have moderate growth when it comes to us.We think about falling inflation, we're.

Thinking about rate cuts from centralbanks around the world. That does provide quite a positiveoutlook for both stocks and bonds. On the equity side, though, on the stockside, it is about being more measured in those return assumptions.So we would still favour a quality bias given some of that uncertainty that doespoint us towards us large cap. We like what's happening in Japan.So we would think about the valuation argument there and the movementspotentially by the Bank of Japan helping some of the financial sector, but alsolooking towards perhaps what could be a later rally out of Europe if we do seestabilization in the economy.

That's kind of lacking at the moment andthinking about that relative valuation argument there.More broadly, though, I think the credit market and the fixed income market ismost interesting given we have seen quite a large movement of bond yieldsdown and seeing that come back up and thinking about the yields that are alsowithin high yield at the moment in terms of that carry potentialcarry, you mentioned US large cap there. We do have a chart on the Bloombergterminal which illustrates just how fast our prices have gone up.I mean, while earnings are coming down. So just quickly, do you feel likethere's some pressure on some of these.

Big companies to justify some of theselofty valuations when it comes to delivering earnings?I mean, there has been a bit of a disconnect between market cap andearnings when we look at some of these top ten stocks.But I think there could be a bit of a rebalancing across the US market as wesee a bit more rotation into other names within the S&P 500 and potentially intosome of the smaller cap names as well. Very cautiously there.But I think some of the rotation you may see in the market is really what willkeep it going this year away from those leaders that we saw in 2023.

That was Carrie Craig, global marketstrategist at Jp morgan Asset Management.Thanks very much for your time this morning.Well, coming up, a Tesla sees a slower growth rate for 2024 as its fourthquarter profit misses estimates. And we are seeing that stock therefalling nearly 5% in after hours trade. More ahead.This is Bloomberg. All right.We're on the Countdown to Ask Hynek, set to report its latest earnings at anyminute now. So it is expected to post its strongestquarterly revenue growth since 2022 as.

The global chip demand returns.Let's get more now with our Asia technology senior reporter Yu Lim Li.She's in Seoul and joining us from there.So you, Lim, what exactly are you expecting?The numbers, actually. Sorry, I'll just jump in here and saythey have just come out at this very moment here in time.So we've actually seen that that net loss coming in at 1.36 trillion won.The estimate was for a loss of 407.5. Operating profit, meanwhile, rising to346 billion won. The estimate had been for a loss of anearly 170 billion won.

Instead, sales coming in at 11.3trillion won. The estimate had been for 10.4.So, um, just with that in mind here, it does seem at the headline that thenumbers are better than what was expected.Yeah, that's right. Thanks for telling you the numbers rightnow. I've been eagerly waiting for them.Basically what this is showing us is that it's.It's a surprise or I think surprise. Basically, it's.They were expecting to post a operating loss of about 170 billion wonfor the December quarter.

And that was going to be the fifthconsecutive quarterly losses for the company.What the numbers are telling us is that they actually posted a profit.Operating profit four for the quarter, which is a surprise.And I think it really indicates that the recovery in the in the memory chipmarket that has been in the prolonged slump is really starting to take place.So obviously the SK Hynix has been benefiting from a boom in demand forhigh end memory chips that power AI applications.And it is a leader in HBM, which is high, high bandwidth memory chips, andits lead over Samsung has helped the.

Company to really boosted shares.And in December it became the second biggest I mean, second most valuablestock in Korea after Samsung. So it it remains to be seen whether, youknow, we will find out more details during a conference call soon.But it's really coming at a background of some positive numbers.TSMC has just reported last week giving a very positive outlook for 2024 anda small which is a major bellwether for the tech and for the semiconductorindustry, Just reported bullish orders for the quarter, which really, you know,sent their shares to a record high. So it could potentially move the stocktoday.

Yeah, potentially.That's a staggering difference between expectation and reality there in termsof the potential stock movements, they were already up 60% on year.What sort of movement can we expect to see at the open?Well, I think, you know, given the Smales performance overnight, it reallysurged to a record high. And that's a really big, big, big movein the semiconductor industry. So I think, you know, the setting isreally positive. And they just reported, you know,earnings that really beat expectations in a big way.So it could potentially move the Korean.

Stock market, too.All right. Asia Technology senior reporter EllenLee in Seoul on those SK Hynix numbers. Or it's still to come, We will discussBoeing a little bit more on the breaking news out of there.We'll have a look at what to expect in terms of markets as well on DAYBREAK,Australia, this is Bloomberg. The top names in climate finance are onBloomberg. I can't tell whether you're optimisticor pessimistic about climate finance. A lot of great stuff is happening, Butis it enough? No, it's not enough.I'm biased.

I'm a huge investor in in both fusionand fusion and hoping that it comes in time.Transition is not going to be an event is a process.But at the end of the day, it's the right thing for the planet, it's theright thing for the industry and various business opportunity. I'd like to kick off with a very simplequestion. Has the whole Brexit process beenmessier, less messy, or as messy as you expected way back in 2016?Was it as messy as we thought it would be?Probably was.

And I tell you why, Because of thefundamental mismatch between, if you like, rational policy in the U.K.and what was if, in a sense, performance of ideology in the UK.I think that was the problem. We could have had the deal, theso-called Windsor deal, several years ago, but the Johnson government simplydid not want a deal on those terms. But I think for the next the medium, theshort to medium term, the next 3 to 5 years is the Brexit will be net negativeon the UK economy, no question about it. And what happens over the longer termdepends on what deal with the British establishment of a UK, a future UKgovernments do.

One I do think ultimately they willfinish up in the next ten or 15 years putting some kind of, I call it a tradedeal with Europe similar to Norway or Switzerland.I disagree with Declan. I think they will pay into a Europeanbudget. I think they will have no choice.It is too big. The fundamental strength of the Europeanof the single market is something that is too attractive for the UK economy tobe excluded from. Maybe the messier part is yet to come. All right.Let's take a look at how Boeing is.

Doing.We've got shares falling 3% after this news that the FAA has halted maxproduction. So a big story coming out of Boeingtoday. We're seeing shares falling after hours.This includes these seven three, seven nine.So a Boeing max production expansion halted by the FAA.So we're seeing a big movement there in shares.Also keeping an eye on Tesla, of course, shares falling in extended trading.Fourth quarter earnings coming in short of expectations.And it issued a warning of weaker sales.

Growth ahead as well.Detroit bureau chief David Welch joins us now for more.So, David, why is Tesla's growth rate slowing?If demand is softened a bit, there's still growth there.It's you know, there's been a narrative out there that nobody wants any of theseanymore. It's not really true.But there is a lot more competition. So look at the markets where Tesla sellsa lot of vehicles. China be widely now surpassed.China is the number one seller to be the.So while China or Tesla is growing in.

The market, others are taking some ofthat growth. So they're not growing as fast.And even though they've lowered prices so the revenue isn't as strong in theU.S., even demand itself is slowing because there aren't enough cheapvehicles and there are charging stations.And then in Europe, good growth there for everybody.But again, you know, when you don't have enough inexpensive EVs out there, youstart to get past the early adopters, past the luxury market, and it's tougherto find buyers. So you put all that together.Tesla's automotive revenue only grew 1%.

In the fourth quarter, and it looks liketheir vehicle sales are going to grow about 20% a year.And they used to it wasn't that long ago.They talked about 50% a year. So investors are looking at this as acompany that's growing, but it's not a growth story anymore.And that's why they always invested in Tesla.Tesla didn't give a forecast for sales this year, which is pretty atypical forthe company. So what's the exact significance ofthat, Do you think that tells investors that the companydoesn't really know how fast they're.

Going to grow anymore?They were adamant for the longest time that it was 50% a year.And then a couple of quarters ago, Elon Musk said that they couldn't grow at 50%forever. It just wasn't possible.But now they're looking at 20%. And if they're if they're if they grew20% last year in vehicle sales and they aren't going to give us a number thisyear, then that tells you it could be even lower than 20%.And so, you know, it'll still be a growing company probably.But if you're not growing even at 20%, it's really a comedown from where itwas.

And investors just want a better handleon things, I think. And that's why you're seeing some peoplewith the stock. You were saying that Tesla and other 80makers aggressively reducing prices. How has this price war been affectingearnings? Why would they think did they miss outon earnings per share just by a small amount?They did slightly beat on gross margins, which is a very watched metric forTesla, and it was 17.2% instead of 17.1 was what the street had for them, butthey used to be over 20%. So when you start cutting prices, raiseyour margin down, it brings revenue down.

And you know, 17, 16%, that's kind ofwhat General Motors is in these days. So the profitability has come down asthey cut prices and and they're not getting the kind of growth they used to,even as they've slashed prices by 25 or 30%.So they're starting to look more and more like an ordinary car company, eventhough they make all of it. David, thanks so much for your time.That was our Detroit bureau chief, David Welch there.Up next, we'll get more reaction to those bumper numbers from SK Hynix.Daiwa Securities is joining us in just a few minutes.This is Bloomberg.

You're watching DAYBREAK, Australia.Well, just drawing attention to one of the breaking news this hour.HYNEK So this is the world's number two maker of memory chips, reporting asurprise operating profit for the fourth quarter.So what really drove that was strong sales of high end memory chips.It's a big supply into NVIDIA. Those chips are used to help train A.I.tools. It has been a big beneficiary of thedemand for that product. So recapping that number here, a profitof 346 billion won. That's just under $260 million.And that compares with an average.

Analyst estimate for around 170 billionwon loss. So moving instead to it to a surpriseprofit here. Let's get more on that now with S.K.Kim, executive director, an analyst at Daiwa Securities.These are really incredible numbers perhaps coming through from SK Hynix.What's your reaction so far? Hello?Yeah. So ask Your Highness just on that firstquarter earnings result. Actually, it's only it's much higherthan the market. Bloomberg Consensus.Yeah, we think that is mainly coming.

From the, you know, high price hike, thememory price hike. So memory prices rebounded from firstquarter last year, but we still believe that asthey have even recorded higher ASP because of their, you know, higherexposure of premium products such as HB three and DDR five.You can get more on them in a moment. Butdo you think what does that tell you that we're at in in terms of therecovery of the chip sector generally? Yeah, actually, a memory cycle is comingaround that is driven by actually supply, you know.So mammoth memory supplier, the.

Expanding production in second of lastyear. And because of that, some OEM such asPCM Mobile they worried about the supply shortage in 2020 for this year.So that does restore some restocking demand from the mobile and the OEM.But I think that that the supply cut that the production is the main driverfor the recovery in the cycle. So like you said, a lot of this iscoming from that demand for the HBM chips, high, high bandwidth memory chipsthat are used for I. Do you think that that Hynix cancontinue to maintain its competitiveness in this field and really continue givenyou've got the likes of Micron and.

Samsung as well that are ramping upproduction right. Oh yeah.Actually you know the yeah we anticipate thecompany electronic to start supplying HP in three to media from fourth quarter.But but the supply has been delayed. We have some some some qualificationrelated to the issue. So I think they just started supplyingHCM three to NVIDIA. But still majority of the you know, theHP product is supplied by HP behind it. So some don't apply the more as of nowtwo other customers such as AMD and HYPERSCALERS.But as you know that media sphere, are.

They maintaining dominant position inthe GPU market so high needs to continue to benefit from this.The market, the data you know, renders came as the first half this year ontier. The chips business is of course a verycyclical one, but with the amount of demand for memory chips and other chipscoming from the AI revolution, can you see longer term that that chip cyclemight be starting to get a bit longer? Is there just enough demand now to goaround? And how does that dovetail with this?Hynix has CapEx plans for this year? Yeah, I think the stair,the recovery in demand is not that.

Meaningful yet this year because of thegeneral cyber demand are remain weak. So we we anticipated this demand willrecover from the second half this year. But as you mentioned, the reboundmomentum is still very low, but demand the momentum is very low.And also we expected some meaningful rebound in demand, especially the airdriven the cloud kept. The CapEx cycle is expected in nextyear. So this year, SK Hynix, I think alreadyalready guided some increase in the CapEx planned for this year are themajority of the upside is coming from the HBO and the mostly,you know, update product.

Well, just in terms of this result, Imean, obviously everybody got it wrong. I'd say none of what we have just seenhas been priced in to the market. What sort of response do you think we'regoing to see for this guy? Heinicke shares at the open and the bothgained 60% last year was 2020 forgotten stock.Yeah yeah I think yeah so yeah we can say some of the memory side of the cycleand I think the momentum is priced in largely, but we still see some, youknow, the robust demand from the such a AGP.You know, I think that and as I mentioned the, you know, the and alsomemory cycle, just the rebound and maybe.

The price will remain you know uptrend.Yeah trend on period first have there's two year or so that just trial strongprice momentum memory price momentum and also the such a continued demand for airI think that will support the share price the more of a now the earnings toturn profitable turn around. Oh that is quite impressivein my view. All right.Ask him the executive director, an analyst at Daiwa Securities, and ofcourse, will seek trading of Hynix just in about 25 minutes time.Certainly a stock to be tracking very closely, but another share price thatwe're looking at in after hours here is.

Boeing, because that company is downmore than 3% in late trade. And that's after the FAA haltedexpansion of Boeing 737 max planes, including its Max nine series.Over 170 of those jets have been grounded in the US.So let's get more now with that transport reporter Danny Lee.I'm interested just how much this caught you by surprise, if at all, given wherewe're at in the investigations into what went wrong in that Alaska Air incidentas well, this is really ultimately an escalating response by the US FederalAviation Administration as it continues its investigation into the blow out ofthe Alaska Airlines door, which has had.

Ripple effects across the scrutiny ofBoeing, its production line, its manufacturing quality, its suppliers, Ithink was the key thing here is that the FAA have decided it will not allow anyexpansion of its production line. And what's key here is that Boeing, itscritical 77 max cash cow plane, ultimately it was producing 38 planes amonth and it was going to add a fourth production line in Seattle, which meansit could go up to 50 planes a month. And you think about the millions thatbillions of dollars it would ultimately generate once this comes to fruitionover the next couple of years. At the moment, this is a no from the FAAand they've been very, very clear here.

And the base and strong words that theywill this will not be business as usual for Boeing ultimately.And so you can see after hours, the impact is pretty strong.Denny, the Boeing CEO, has been summoned to Capitol Hill for a please explainmoment. But more broadly, there's something beenhappening at Boeing over the past few years.Is there a change to cultural production that's behind the string of mishaps?Well, the FAA has been scrutinizing Boeing for the last couple of years.Already, they've been having greater oversight over its production.And so now what we have seen in this.

Latest fiasco is a firmer response.But when we heard on Capitol Hill earlier today in the US, Boeing sayingthat they are going to be as transparent as they can be, they are being astransparent to lawmakers who are getting a lot more concerned about what is goingon. But then the lawmakers are also thensaying we fully trust basically what Boeing is telling us.They're being honest and open in their dealings.So clearly, you've got a divide here that whilst there is real heat on Boeingand one sector on the from the customers of the airlines and the regulators,there is clearly a field in Washington.

Of trying to also support one of thebiggest exporters. All right.Asia transport reporter Danny Lee there. Let's take a look at how we're trackingall markets at the moment. Here in Australia, we're now better byabout a third of 1%. We've got Nikkei futures looking alittle bit softer ahead of the open. Of course, it's been a very good coupleof months, though, for the Nikkei. We've got S&P in is now trading as well,just very, very modestly in positive territory as well.You can see that after hours, IBM shares performing pretty well.We've got Tesla shares a bit lower, down.

5.2% after as they were off about 6%.The earnings call has now finished for Tesla.All right. Still to come, we've got our exclusiveinterview with the Thai deputy minister of finance, where he discusses thecountry's central bank policy and Arabs weighing down the economy.This is Bloomberg. Thailand's deputy finance minister isamplifying rate cut calls as borrowing costs hover at a ten year high.Japan, I'm on we are told us exclusively that high interest rates are holdingback the economic recovery. The problem with Thailand right now isthat we believe the economy growth of.

GDP is not where it should be.The current central bank policy rate is a two and a half percent.Does the government think the economic conditions are in place?For two and a half percent to be lower. Is that does that look too high giventhe reality on the ground? The current interest rate is quiteconcerning to to the government. It is too high considering the spendingpower that the Thai citizens, Thai people pass at the moment.It's difficult for the people of Thailand to to live at this number 2.5%interest rate. The digital handouts.The timing on when that becomes public.

Or when it takes effect.Well, yes, Give us an update when you think that that might happen.The initial planning was in May, but that we announce that it has to bepostponed. Is it definitely going to pass, though?It is in place. The proposed project should be still onwithin this year. Within this year.Okay. This rift that's going on between thegovernment and the Bank of Thailand. What's going on?The thing is that the government, the government and theBank of Thailand is structure in.

Thailand, maybe differently from somecountries. Okay.Because the Bank of Thailand has to be independent from the government, fromfrom from anyone you know, has to be fully independent.The Bank of Thailand mentioned about some issue, for example,that digital wallet project that they are concerningthe successful of the project, the source of funds which we we listen welisten to to to adapt. But we are also concerned that the.Right now the bank is a bit too distanced from thepeople after we announced a digital.

Wallet project.There are so many polls in the country. Lastly, there is a poll from one of thetop commentator in Thailand. He asks if people think that theinjection of money, the the problem about the situation of the economy isreal. In Thailand, 90, 93% said right now theeconomy is in bad shape. Okay, so the government thing andbelieve that it is imperative that we need to inject money into the system sothat people can have better living, you know, have abetter life. The target on tourism, that's a very bigpart.

What happens when tourism plays a verybig part on whether you achieve your growth targets?8 million is the target, I believe, for mainland Chinese tourists into Thailand.8 million tourists. Well, the goal for this year, number oftourists coming in to Thailand is 30 million people.Chinese people accounted for 20%. Okay.We believe that we can reach that number afterwe announced the free visa policy last year.Right. Yeah.Beginning of this year, the number of.

Tourists of of Chinese has doubledalready. So we believe that we can reach thatnumber, even though it's at millions, it's not too difficult.That was Thailand's deputy finance minister, speaking exclusively withBloomberg Markets co-anchor David Inglis.Coming up, the criminal hacking gang locked bid says it was behind theransomware attack on stop lending platform.And we learned. We'll have more details next.This is Bloomberg. The criminal hacking gang locked bid isclaiming it was behind a ransomware.

Attack that caused a Wall Street stocklending platform to crash. Bloomberg Su Keenan joins us.And Sue, this is really just the latest in what's been a series of hacks to rockthe financial industry. Yeah, and they picked a very big targetin this latest attack, apple lend, which was formed by a group of big banks andbroker lenders, including Goldman and JPMorgan Chase.Back in 2001 is a key player in what's called the stock lending market throughits end game platform. Now stats show it processes more than2.4 trillion in transactions on a monthly basis.So at time of attack, that causes some.

Of its operations to crash or shut downis a very big deal. Lock Bid.A notorious criminal hacking gang has now claimed responsibility in what isnow its latest in a series of high profile attacks.Bloomberg is reporting that the spokesperson for the group said theywill try to negotiate with the company for payment in exchange for unlockingthe affected systems. Apple and is in an interesting positionat the moment. As mentioned, it's owned by a number offinancial firms, but it also just announced plans to sell a majority staketo a New York based private equity firm.

And now a lot of its operations aretechnically out of its control. Akerlund has said it is working withprofessional advisers and cybersecurity firms to restore everything to normal,but it is advised clients this could take at least a few days.And of course, back in November, a US unit of China's ICBC was attacked in asimilar manner. What have we learned since then?Yeah, at the time it disrupted the Treasury market trading here in the US.What we've learned is this criminal hacking gang is prolific.They are organized and they've been highly successful in taking bigfinancial and other firms offline.

You're looking at the headquarters ofCIBC and disrupting their businesses and demanding money in return for restoringthings to normal. Now, in November, the New York arm ofthe ICBC was cut off from the US Treasury Department.LOCKE They claimed responsibility for that.Since 2020, Lockwood has carried out more than 1700 hacks and extorted 91million from its victims. That's according to the US Cybersecurityand Infrastructure Security Agency. In January, it hit a major softwaretrading firm. In November, in addition to ICBC, it hitthe Chicago Trading Company, an outfit.

And Asset management.NOLA.com. Its attacks can be highly disruptivebecause the group breaks into computers and encrypts data on them so that thecompanies that are in control of these systems really can't operate them.The gang then demands payment in exchange for a key that can be used tounlock the infected machines. Aquilina spokesperson did notimmediately respond to the request for specifics on how they were hacked.But many in the industry will be watching closely to see how this getsresolved. All right.Bloomberg says Su Keenan that the Dutch.

Chip equipment maker ASML says it'sseeing positive signs and sales growth after orders more than tripled lastquarter. CEO Peter Vinik told us more about theoutlook for China as Washington pushes for export bans to hobble Beijing's techambitions. 90% of our business in China has to dowith mature technology, and that's the technology that we need for all themajor transitions. You know, if you think about the energytransition, the electrical vehicle transition, digitization rollout of thesmart grid, you know, life sciences, it's all maturetechnology.

That's where the masses are.So what is your message to those in Washington, lawmakers in Washington,lawmakers in The Hague, even who are pushing to expand those restrictionsbeyond the most cutting edge lithography machines, to expand those restrictionson the sale of lithography to China? Well, you know, I have full respect fornational security concerns. That's not the point.But I think we need to take into consideration that this the chipindustry has created an almost seamless ecosystem across the globe that hasgiven us massive advantages in terms of innovation and cost reduction.So that's from an economic point of.

View.We need to make sure that that economic system that we have created, which hasgiven us so much benefit that we keep that intact.It's not about national security. It's about making sure that innovationcan keep going. So you are you're stepping down inApril. Does your successor at least have towargame the possibility, the scenario where ASML has to operate in a globalmarket ex China? Well, you know,I don't know what he's wargaming. I don't think he's a gamer, to be veryhonest.

You know, we'll just have to deal withthe reality. But I also, you know, I'm I'm anoptimist that worries a lot. And I do believe that we have created,you know, macro economic systems that are sodependent on each other that I think that is a scenario you can always putinto into a game. But I don't think that's a veryrealistic one. You do not have generative AI withoutASML. It's as simple as that without yourextreme ultraviolet lithography machines.How much demand are your clients saying.

They are seeing for chipmaking equipmentto generate those kind of AI chips? Well, let me first of all say that Ithink the full extent of what I could bring is not totally clear because it'sall about the applications now and that still needs to develop.But the one thing is absolutely sure, it's going to need massive amounts ofcompute power and storage, data storage. So I think withoutASML, without our technology, that's not going to happen.So it's very clear there's going to be a big driver going forward for ourbusiness and the business of our customers.That was ASML CEO Peter Vanek speaking.

To Bloomberg's Tom Mackenzie.Sticking with the chip space because they've got trade in Korea and Japanopening shortly, but SK Hynix and its peers could be getting a boost from theKorean memory chip maker. We had its earnings out later in asurprise operating profit. We know, of course, analysts had beenexpecting a loss of really one to be tracking Tesla.Supplies are also going to be a focus for us because we saw the EV makerposting fourth quarter earnings that missed Wall Street estimates.So Tesla is now forecasting a slower pace of growth this year and also aswell working on the launch of its next.

Generation vehicles there.Some of the major suppliers into Tesla, you can see that.Meanwhile, IBM suppliers and peers. Also to note, because we had a positiveoutlook for revenue and cash flow from the company and you can see that stockthere continuing to track up nearly 8% in after hours.But coming up in the next hour, we'll have BlackRock Investment Institutetelling us why they're neutral on China. Whilst we discussed the latest data fromthe region with Natixis, this is Bloomberg.

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