August 1, 2025 • 22 mins
On today's podcast:
1) Markets take a hit as President Trump unleashes a wave of new tariff rates. The world is facing some of the steepest US tariffs since the 1930s, with an average of 15%, according to the text. So far, the global economy has held up better than many economists expected after Trump’s initial tariff blitz. A rush to beat the elevated rates spurred a front-loading of exports, aiding many Asian economies and shielding US consumers from price spikes.
2) Shares of Amazon sell off while Apple rises following the latest tech earnings. Apple reported its fastest quarterly revenue growth in more than three years, with revenue rising 9.6% to $94 billion in the fiscal third quarter. Amazon dropped in premarket trading after projecting weaker-than-expected operating income and trailing the sales growth of its cloud rivals. CEO Andy Jassy said it was "very early days" in artificial intelligence, and that the company's efforts to lower the costs of running AI applications would draw more customers over time.
3) Investors prepare for the July jobs report to wrap up a week of key US economic data. Bloomberg Economics predicts July’s seasonally adjusted nonfarm payrolls to increase by 160,000 — higher than the consensus expectation of 105,000.
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Episode Transcript
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Speaker 1 (00:02):
Bloomberg Audio Studios, Podcasts, Radio News.
Speaker 2 (00:10):
Good morning, I'm Nathan Hager and I'm Karen Moscow. Here
are the stories we're following today.
Speaker 3 (00:15):
Karen, Yeah, futures are following this morning after President Donald
Trump unleashed his final round of tariff announcements on countries
around the world hours before his August first deadline. The
President slapped thirty five percent tariffs on Canadian goods not
covered under the US Mexico Canada trade agreement. Switzerland's products
were hit with a thirty nine percent rate, and Taiwan's
(00:36):
exports are facing a twenty percent duty, though that country
says it expects to keep negotiating. We get more from
Bloomberg News Global Trade editor Brendan Murray.
Speaker 4 (00:45):
The bottom line here is that the average US tariff
rate is going from about two and a half percent
before Trump was sworn in in January to around fifteen
percent according to Bloomberg Economics. And that's, in any economist book,
a difficult thing for an economy to absorb. So I
think we'll see some more talks going on in the weeks.
(01:07):
In the days and weeks ahead.
Speaker 3 (01:08):
Bloomberg's Brenton Murray says most countries are facing a baseline
ten percent rate, while roughly forty nations are jumping to
fifteen percent. The new tariffs won't take effect until August seventh,
to give US Customs and Border Protection time to prepare.
Former US trade negotiator Steven Olsen says that could add
to market uncertainty.
Speaker 5 (01:26):
We do have a week to go, and this is
a man who thrives on chaos and unpredictability and sometimes
seems to be running his trade policy like a reality
TV show. So until these tariffs actually go into effect
on August seventh, let's sit back and see what happens.
Speaker 3 (01:45):
Former trade negotiator Steven Olsen says President Trump has embraced
tariffs for decades, so these moves should not come as
a surprise.
Speaker 6 (01:53):
Well, Nathan.
Speaker 2 (01:53):
President Trump is also escalating his campaign to pressure pharmaceutical
companies to lower drug prices, and Bloomberg's John Tucker joins
us with the very latest John, good morning.
Speaker 7 (02:02):
And good morning Karen. In letters send to Eli, Lilly, Novo, Nordis, Pfizer,
and others, Trump insisted the companies immediately lower what they
charge Medicaid for existing drugs. He also asked them to
guarantee that future medicines be launched and remain at prices
on par with what they cost overseas. He gave the
world's seventeen largest drug makers sixty days to comply. If
(02:24):
they don't, he writes, his administration will quote deploy every
tool in our arsenal to protect American families. The pharmaceutical
industry has long protested the idea of globally linked drug
prices as a threat to years of US dominance in
biomedical research. They've urged the administration instead to turn its
attention to the middle men in the supply chain. Right now,
(02:45):
in European trading, shares of Novo nordis down another four
point eight percent. That company loses its spot among Europe's
ten most valuable companies. Peiser pre market is down six
tenths of a percentw Yor Income John Tucker Bloomberg.
Speaker 3 (03:00):
Okay, John, thank you. Earnings are also very much in
focus this morning. We're watching shares of Amazon. They are
down more than eight percent pre market. The online retail
giants projecting weaker than expected operating income and is trailing
the sales growth of its cloud rivals. That has investors
questioning whether Amazon's huge investments and artificial intelligence are paying off.
Anarag Rana is a senior tech analyst at Bloomberg Intelligence.
Speaker 8 (03:23):
Do you see you know, they met expectations on Aw's
growth of seventeen percent in constant currency. But you know,
this is where we are saying that this is probably
not good enough because Microsoft beat by a big number.
Google beat by a big number, and the big question
is going to be, you know, why didn't Amazon beat
by a big number?
Speaker 3 (03:42):
Bloomberg Intelligence is on arag Rana says Amazon spenter record
thirty one point four billion dollars on capital expenditures in
the quarter. That was up about ninety percent from the
same period a year earlier.
Speaker 2 (03:53):
On the flip side, Nathan shares of Apple are at
more than one and a half percent. The iPhone maker
posted as fast as corely revenue growth in more than
three years. Strong iPhone sales and a rebound in Shana
helped beat estimates despite a projected tariff hit.
Speaker 6 (04:07):
Mark German covers Apple for Bloomberg.
Speaker 9 (04:10):
There are people who still have iPhones that are several
years old, four to six even older years of iPhone right,
There's people on Android, there's people new to the smartphone market,
and clearly the impact of tariffs didn't have a negative.
Speaker 7 (04:24):
Impact on Apple.
Speaker 9 (04:25):
It had a positive impact on Apple. That's because a
lot of people were anticipating major price hikes to the
iPhone and they flooded Apple retail stores.
Speaker 2 (04:34):
Bloomer's Mark German says Apple predicted that fourth quarter revenue
would be up by a percentage in the mid to
high single digits. CEO Tim Cook also says the company
is helping investment in artificial intelligence.
Speaker 3 (04:45):
Well, this morning, Karen, the earnings focus turns from big
tech to big oil. We'll hear from both ex On
Mobile and Chevron. We get a preview from Bloomberg's Tom Busby.
Speaker 10 (04:54):
Investors at Exon Mobile eager to hear about the company's
progress and developing a massive oil field in Guyana, also
the latest shale production plans in the Permian Basin. Bloomberg
consensus calls for revenue of eighty point three nine billion
dollars and adjusted earnings per share of a dollar fifty six.
Chevron investors want to hear about the company's long delayed
but now completed acquisition of Hess and how that'll impact
(05:17):
its share buyback plans. Bloomberg consensus calls for revenue of
forty six point seventy five billion on adjusted earnings per
share of a dollar seventy one. Tom buzzby Bloomberg.
Speaker 11 (05:27):
Radio, All right, Tom, Thanks.
Speaker 2 (05:28):
A busy week on the economic front concludes this morning
with the July jobs report. Economists are forecasting a gain
of one hundred and four thousand jobs at an unemployment
rate of four point two percent. Begin more with Bloomberg's
Michael McKee.
Speaker 12 (05:40):
Job growth will slow and unemployment will have ticked up
in July, economists forecasts. But it's not the end of
the world or even the economic expansion. Once again, it's tariffs.
Companies have been suspending guidance and announcing price increases to
offset tariffs, but they have not yet resorted to cutting jobs.
It won't matter much to the FAD if unemployment does
rise by a tenth or so, but a quick jump
(06:02):
to say four and a half percent, would worry policymakers,
who may take it as a signal policy is too tight.
There will be time to consider the implications no matter
what we get. The next FED meeting is not until
September seventeenth. Michael McKee, Bloomberg radio.
Speaker 3 (06:17):
All right, Mike, thanks and speaking of the Fed, President
Trump is keeping up his pressure campaign on j. Powell
to lower rates, once again, taking to social media to
criticize the FED chair. Lyle Brainerd is a former vice
chair of the Federal Reserve.
Speaker 13 (06:30):
What has been surprising to me is to hear the
President talk about lowering rates as though it is the
Federal Reserves responsibility to lower rates for US Treasury debt management.
And that, of course, is exactly how central banks go
wrong in emerging markets.
Speaker 3 (06:52):
Former FED Vice chair Lyle brainer also says she thinks
the President's higher tariff rates will hamper economic growth.
Speaker 2 (06:59):
And finally, Nathan and of an Era, Ray Dalio has
sold his last remaining stake in Bridgewater Associates and also
left the hedge Funds board. Dalio first announced his succession
plan more than a decade ago, but he did not
fully hand over the rains until twenty twenty two, when
he transferred his voting rights to its board of directors
and stepped down as one of its three co chief
investment officers. He stayed on the board at the time,
(07:21):
and Dalio founded the firm in nineteen seventy five. Time
now for a look at some of the other stories
making news in New York and around the.
Speaker 6 (07:30):
World, and for that we're joined by Bloomberg's and Michael Barr. Michael,
good Morning, Good morning, Karen.
Speaker 14 (07:34):
Storms have been lashing the East Coast from Virginia to Connecticut,
flooding roadways in New York. Vehicles were stranded in pockets
of high water and water pouring over a train in
Manhattan's Grand Central Terminal. Commuter rail lines into suburban Long
Island and New Jersey were suspended in places, flash flood
(07:55):
warnings and effect for parts of New York City, New Jersey,
and Philadelphia. States of emergency have been declared in New
Jersey and New York City. With more on the weather,
here's Bloomberg meete religius Craig Allen.
Speaker 15 (08:08):
The delus from last evening. That's gone. There are still
some showers around. They'll be moving out of the area.
All flood alerts have been canceled. I mean, it must
have been frightening for some of those caught in the
flooding range that caused the flash flooding on some of
the major interstates around the region.
Speaker 14 (08:24):
Bloomberg Media relogist Craig Allen. The storms delayed flights from
Boston to Washington, d C. The NYPD and politicians gathered
at the funeral Thursday for the officer killed in the
Midtown Manhattan mass shooting this week. Ditital Islam was off
duty working security when he was fatally shot by a
gunman at three forty five Park Avenue. Islam is one
(08:47):
of three funerals these past few days. Also yesterday, funeral
services took place for Blackstone executive Wesley Lapatner. Her fourteen
year old daughter gave the eulogy.
Speaker 11 (08:58):
My mom was like my Rocky.
Speaker 2 (09:01):
I would talk to her and I can't or canny news,
nothing else would make it better.
Speaker 14 (09:08):
Funeral services were held for Roudent employee Julia Hyman on Wednesday.
Israel's military intelligence agency is undergoing changes. The service is
making profound revisions, including reviving an Arabic language recruitment program
for high school students and training all troops in Arabic
and Islam. It comes after the October seventh, twenty twenty
(09:30):
three attack by hamas global news twenty four hours a
day and whenever you want it with the Bloomberg News
Now Michael Barr and this is Bloomberg.
Speaker 6 (09:38):
Karen all right, Michael Barr, thank you.
Speaker 2 (09:44):
Time now for the Bloombergy sports Okay, brought to you
by Flushing Bank, and here's John stash Hour.
Speaker 6 (09:49):
John, good morning, Good morning, careen.
Speaker 16 (09:50):
It was let's make a deal day throughout baseball and
perhaps no team busier just before the trade deadline than
the Yankees. They had already added three players. They added
four more. There are three relief pitchers. David Bednar was
a two time All Star in Pittsburgh. Camillo de Val
had over one hundred career saves, while in San Francisco,
Jake Bird comes from Colorado. And then in the eighth
inning of the Yanks seven to four went over Tampa Bay.
(10:13):
They acquired a player who was in the opposing dugout.
Jose Caballero has been Baseball's best base dealer of the
past two seasons. Aaron Boom impressed with what the front office,
SA chief.
Speaker 11 (10:23):
Love what they were able to do.
Speaker 17 (10:25):
I think we're a better club today than yesterday, and
certainly today than we were last week. And now we
know what we were going with and what we got,
you know.
Speaker 16 (10:39):
Onward, they win over the Rays the third in a row.
They jumped to a seven nothing lead. It was seven
to four when there was a rain delay of nearly
three hours and then no scoring after that. Yanks down
three and a half behind Toronto, playing tonight in Miami
and the Metz Hosta Giants. Mets have a new center fielder,
Cedric Mullin spent eight seasons in Baltimore. A few years ago,
had thirty home runs and stolen bases. Carlos Correa, going
from Minnesota back to Houston, where he spent seven years,
(11:02):
helped the Astros win a World Series. The Red Sox
landed pitcher Dustin May from the Dodgers. They beaten May
in a game a few days ago at Benway. Taylor Rogers,
whose twin brother Tyler was just acquired by the Mets,
was traded for the second day in a row. He's
touring the NL Central, went from Cincinnati to Pittsburgh and
now the Cubs. A year ago, the Knicks sent a
boatload of draft picks to the Nets from Michel Bridges.
(11:24):
He averaged eighteen points a game, led the NBA AD
minutes played in. Bridges now has a new contract with
the Knicks four years, one hundred and fifty million, he
has never missed a game in his seven year career.
Speaker 11 (11:35):
John Staneshawer Bloomberg Sports.
Speaker 1 (11:39):
Coast to Coast on Bloomberg Radio, nationwide on Sirius XM,
and around the world on Bloomberg dot Com and the
Bloomberg Business Altum. This is Bloomberg Daybreak.
Speaker 3 (11:49):
Good morning, I'm Nathan Hager here. It is August first,
and as promised, President Donald Trump has announced a slew
of new terror frights on countries around the world, after
announcing deals with a handful of them in recent weeks.
But former US trade negotiator Steven Olsen says he wouldn't
call these deals.
Speaker 18 (12:07):
What we've got here are a series of extremely vague
framework agreements which will require additional negotiations before they're actually
translated into anything even approximating well, we could legitimately refer
to a trade agreement.
Speaker 3 (12:24):
Steven Olsen is now a senior fellow at the Institute
of Southeast Asian Studies and for more. We're joined this
morning by Bloomberg News Senior editor Bill Ferries. So, Bill,
what do we have this morning?
Speaker 11 (12:34):
Good morning, Good morning. So yeah, we're here.
Speaker 19 (12:38):
It's been a long bumpy road since those April second
Liberation Day tariffs were first announced, We've seen a lot
of pauses and fits and starts since then. This does
seem to be a kind of the moment.
Speaker 14 (12:52):
Now.
Speaker 19 (12:52):
President Trump, as you said, unleashed a whole slew of tariffs,
some some big surprises in there, some countries getting more
than they bargained for, and I think the baseline rate
of ten percent kind of a pleasant surprise to other
countries who maybe had been expecting that to increase. So
the market's kind of still digesting this, and it's you know,
(13:17):
there's still countries, big, big outliers there like China and
India still looking to make deals. So it does seem
like the deadline has been reached, but there's still going
to be a lot going on in the days and
weeks in head.
Speaker 3 (13:30):
Well, let's get into that. What could we see over
the next few days here, particularly when we're seeing you know,
some countries like Switzerland and Canada getting hit with much
higher rates than that ten percent baseline you just mentioned.
Speaker 19 (13:44):
Yeah, I think those are two of the big surprises,
particularly Switzerland getting a thirty nine percent tariff when you
consider that many of its neighbors who are EU nations
got about a fifteen percent. Switzerland, of course, exports huge
amount of pharmaceuticals to the US, so that's going to
have an immediate hit on drug prices once that comes
(14:06):
into effect August seventh. And out in Asia, you've seen
countries or governments like Taiwan getting twenty percent, while two
of its biggest rivals, Japan and South Korea, were at
fifteen percent. So the effect of these tariffs as it
plays out in the days and weeks ahead, is going
to be shifting kind of the competitive landscape between countries
(14:30):
that may you know, have typically competed in similar products
but have different rates when it comes to exporting to
the US.
Speaker 3 (14:36):
To your point, I guess we've heard from Taiwan as
well that they consider that twenty percent rate that you
just mentioned temporary and that more negotiations could be to come.
Is that what we should expect here, that even more
of these countries could keep negotiating even after this August
first deadline that's coming gone.
Speaker 19 (14:55):
Yeah, I mean, so the August first deadline that will
those tariffs are sposed to kick in August seventh. In theory,
I think there's going to be time there to negotiate
But last, yes, I think nations, if they've learned anything
about President Trump, it's that he's a deal maker. He
likes to make deals. They the White House may feel
like it has made those deals. But I think if
(15:16):
a if a country comes in, if India or a
Taiwan comes in, and they say, you know, they find
a way to perhaps buy more American products or or
make some changes. I don't think that down the road
we're you know, I think down the road, I think
we're going to see more deals getting tweaked. And that's
(15:36):
what a lot of governments are going to be banking
on going forward.
Speaker 3 (15:40):
So if we do see these terrif rates kicking in,
as you mentioned on August seventh, once the US Customs
and Border Protection gets that time to adjust to this,
what's the potential economic impact from where these terif rates lie.
Speaker 19 (15:57):
Now it's a huge global economic experiment and an experiment
for the US economy. I mean, these tariffs, these US
tariffs are now going to be at the highest rate
since World War Two. And even if some countries are
breathing a sigh of relief that they got just ten percent,
and I'm thinking, you know, countries like Singapore for instance,
ten percent. The average US tariff was about two percent
(16:21):
six months ago. So these are huge changes and they
will continue to trickle through into the US economy and
it's hard to not see that starting to affect inflation
more seriously in the months ahead.
Speaker 3 (16:34):
And on top of all this bill, I guess we're
still waiting for a lot of sectoral tariff announcements as well.
I mean, what could that mean when it comes to
certainty in the market.
Speaker 19 (16:46):
Yeah, there is still a lot of uncertainty. There are
products pharmaceuticals are chief among them, semiconductors, those are still
being subject to what the US calls these Section two
three two investigations to see if there's a national security risk,
and presumably if there are, that allows Donald Trump to
(17:08):
put additional tariffs on those products. So, by no means
is this the end of it, just because countries have
gotten their number some of the products they export Switzerland
I said thirty nine percent, but a big pharma exporter,
they could be seen increased tariffs on those products once
the US reaches those decisions.
Speaker 3 (17:29):
And not the end of it, but maybe the market
adjustment to what's happening now is just beginning. Thank you.
Speaker 14 (17:34):
For this.
Speaker 3 (17:35):
Bloomberg News Senior editor Bill ferries with us on this
August first, Karen.
Speaker 2 (17:40):
Nathan, we're also focusing on the markets in big tech
earnings this morning. Shares of Amazon, they are down more
than eight percent, Apple up. It's higher by almost two
percent right now. And this follows yesterday's After the Bell
reports for more, We're pleased to welcome Bloomberg Radio and
TV anchor Kreedie Goopta Creedy.
Speaker 6 (17:59):
Good morning, Hey, Chriatie.
Speaker 2 (18:00):
Let's start with Amazon, because it's really hard to ignore
the stock move this morning.
Speaker 6 (18:04):
What are investors reacting to?
Speaker 20 (18:06):
Good morning, Karen, Yeah, it's been a really interesting tech
earning story, A tale of two. I think is fair
to say Amazon cheres down by eight percent, treating about
two hundred and fifteen.
Speaker 11 (18:14):
Dollars a share.
Speaker 20 (18:15):
This is all about weakness when it comes to Amazon
Web services. When you think Amazon, we think about the packages,
we think about the e commerce business. But ultimately they
are pivoting firmly in the tech direction and that's where
they've disappointed the market.
Speaker 1 (18:28):
Now.
Speaker 20 (18:28):
It doesn't help that we also got Microsoft earnings just
twenty four hours before, which really set a positive tone
for cloud adoption for the Asia kind of services that
they had, So the expectations were pretty high for Amazon
to impress the market, and to be fair, they did
in some ways. Their revenues did come in better than expected,
but not by much. And this is a market that
(18:50):
is very tough on tech companies right now that the
expectations are high and you have to be even better
than the expectations. You have to get an A plus
plus instead of just and a plus. And this is
where Amazon kind of finds itself right now because they're
also talking about weaker than expected operating income as well
as some of the sales growth when it comes to aws.
Speaker 11 (19:10):
So that big idea of spend.
Speaker 20 (19:12):
Big on AI, spend big on cloud and see that
kind of multiply ultimately over time. That's the shadow of
doubt that's being cast from Wall Street this morning.
Speaker 2 (19:21):
And it really did seem like CEO Andy Jasse he
had a longer view when it came to all of this,
but he still couldn't ease those concerns on the earnings call,
could he?
Speaker 11 (19:30):
He couldn't.
Speaker 20 (19:30):
He's trying to use that magic word that I think
we've seen and not just the tech companies in the
tech space, but across corporate America and arguably the global
corporate sphere, which is artificial intelligence. And there was an
era where every time you said artificial intelligence, the stock
would just spike because of this kind of momentum driven story.
And he's making that point. He says, look, we're very
early days in that investment story. We know Amazon has
(19:51):
that massive anthropic venture as well, and they are competing
with the likes of Alphabet, Microsoft, Oracle among others as
well in the out space.
Speaker 11 (20:00):
There. He's saying, give it some time.
Speaker 20 (20:03):
But this is now at a point where Wall Street
is looking at these AI kind of expectations, looking at
these AI investments and say when is it going to
pay off? And Andy Jesse wasn't able to make that case.
Speaker 2 (20:14):
All right, well, we're seeing better reaction to Apple this
morning it reported fastest revenue growth in more than three years.
Speaker 6 (20:19):
What else did you take away from this?
Speaker 20 (20:21):
You know, it's funny because we go into Amazon with
such a strong earnings expectations. With Apple, you went in
with some pretty beat up earnings expectations.
Speaker 11 (20:30):
The idea that the tariff story would really.
Speaker 20 (20:32):
Eat into the bottom line, would eat into the supply chains,
especially as Apple tries to move their supply chain from
China to India. And you actually saw the opposite on
two key fronts. One that so much of those tariffears
actually showed up and people buying iPhones ahead of time
expecting the prices to go up, So that was good
news for their bottom line revenue. But also the fact
that they are actually doing better than expected in China.
(20:55):
And this has been a key sticking point for Apple.
Because Apple is ultimately an American lug product, there are
plenty of competitors in Asia as well, and they haven't
been able to have the foothold and the growth in
that part of the world that they were really hoping for,
to the point that just this week has been reported
that they shuttered their first retail store in China, really
kind of showing that weakness that they've had there. I
(21:16):
think it's crucial though, that Apple has at least today
convinced investors that is no longer the narrative. The question
now moving forward is cand of sustain that growth in
the iPhone picture, but also in Asia.
Speaker 2 (21:27):
This is Bloomberg day Break, your morning podcast on the
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Speaker 3 (21:34):
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Speaker 2 (22:00):
And don't forget to subscribe to Bloomberg News Now. It's
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platform to stay informed all day long. I'm Karen Moscow.
Speaker 3 (22:13):
And I'm Nathan Hager. Join us again tomorrow morning for
all the news you need to start your day right
here on Bloomberg Day Ray
Bloomberg Audio Studios, Podcasts, Radio News.
Speaker 2 (00:10):
Good morning, I'm Nathan Hager and I'm Karen Moscow. Here
are the stories we're following today.
Speaker 3 (00:15):
Karen, Yeah, futures are following this morning after President Donald
Trump unleashed his final round of tariff announcements on countries
around the world hours before his August first deadline. The
President slapped thirty five percent tariffs on Canadian goods not
covered under the US Mexico Canada trade agreement. Switzerland's products
were hit with a thirty nine percent rate, and Taiwan's
(00:36):
exports are facing a twenty percent duty, though that country
says it expects to keep negotiating. We get more from
Bloomberg News Global Trade editor Brendan Murray.
Speaker 4 (00:45):
The bottom line here is that the average US tariff
rate is going from about two and a half percent
before Trump was sworn in in January to around fifteen
percent according to Bloomberg Economics. And that's, in any economist book,
a difficult thing for an economy to absorb. So I
think we'll see some more talks going on in the weeks.
(01:07):
In the days and weeks ahead.
Speaker 3 (01:08):
Bloomberg's Brenton Murray says most countries are facing a baseline
ten percent rate, while roughly forty nations are jumping to
fifteen percent. The new tariffs won't take effect until August seventh,
to give US Customs and Border Protection time to prepare.
Former US trade negotiator Steven Olsen says that could add
to market uncertainty.
Speaker 5 (01:26):
We do have a week to go, and this is
a man who thrives on chaos and unpredictability and sometimes
seems to be running his trade policy like a reality
TV show. So until these tariffs actually go into effect
on August seventh, let's sit back and see what happens.
Speaker 3 (01:45):
Former trade negotiator Steven Olsen says President Trump has embraced
tariffs for decades, so these moves should not come as
a surprise.
Speaker 6 (01:53):
Well, Nathan.
Speaker 2 (01:53):
President Trump is also escalating his campaign to pressure pharmaceutical
companies to lower drug prices, and Bloomberg's John Tucker joins
us with the very latest John, good morning.
Speaker 7 (02:02):
And good morning Karen. In letters send to Eli, Lilly, Novo, Nordis, Pfizer,
and others, Trump insisted the companies immediately lower what they
charge Medicaid for existing drugs. He also asked them to
guarantee that future medicines be launched and remain at prices
on par with what they cost overseas. He gave the
world's seventeen largest drug makers sixty days to comply. If
(02:24):
they don't, he writes, his administration will quote deploy every
tool in our arsenal to protect American families. The pharmaceutical
industry has long protested the idea of globally linked drug
prices as a threat to years of US dominance in
biomedical research. They've urged the administration instead to turn its
attention to the middle men in the supply chain. Right now,
(02:45):
in European trading, shares of Novo nordis down another four
point eight percent. That company loses its spot among Europe's
ten most valuable companies. Peiser pre market is down six
tenths of a percentw Yor Income John Tucker Bloomberg.
Speaker 3 (03:00):
Okay, John, thank you. Earnings are also very much in
focus this morning. We're watching shares of Amazon. They are
down more than eight percent pre market. The online retail
giants projecting weaker than expected operating income and is trailing
the sales growth of its cloud rivals. That has investors
questioning whether Amazon's huge investments and artificial intelligence are paying off.
Anarag Rana is a senior tech analyst at Bloomberg Intelligence.
Speaker 8 (03:23):
Do you see you know, they met expectations on Aw's
growth of seventeen percent in constant currency. But you know,
this is where we are saying that this is probably
not good enough because Microsoft beat by a big number.
Google beat by a big number, and the big question
is going to be, you know, why didn't Amazon beat
by a big number?
Speaker 3 (03:42):
Bloomberg Intelligence is on arag Rana says Amazon spenter record
thirty one point four billion dollars on capital expenditures in
the quarter. That was up about ninety percent from the
same period a year earlier.
Speaker 2 (03:53):
On the flip side, Nathan shares of Apple are at
more than one and a half percent. The iPhone maker
posted as fast as corely revenue growth in more than
three years. Strong iPhone sales and a rebound in Shana
helped beat estimates despite a projected tariff hit.
Speaker 6 (04:07):
Mark German covers Apple for Bloomberg.
Speaker 9 (04:10):
There are people who still have iPhones that are several
years old, four to six even older years of iPhone right,
There's people on Android, there's people new to the smartphone market,
and clearly the impact of tariffs didn't have a negative.
Speaker 7 (04:24):
Impact on Apple.
Speaker 9 (04:25):
It had a positive impact on Apple. That's because a
lot of people were anticipating major price hikes to the
iPhone and they flooded Apple retail stores.
Speaker 2 (04:34):
Bloomer's Mark German says Apple predicted that fourth quarter revenue
would be up by a percentage in the mid to
high single digits. CEO Tim Cook also says the company
is helping investment in artificial intelligence.
Speaker 3 (04:45):
Well, this morning, Karen, the earnings focus turns from big
tech to big oil. We'll hear from both ex On
Mobile and Chevron. We get a preview from Bloomberg's Tom Busby.
Speaker 10 (04:54):
Investors at Exon Mobile eager to hear about the company's
progress and developing a massive oil field in Guyana, also
the latest shale production plans in the Permian Basin. Bloomberg
consensus calls for revenue of eighty point three nine billion
dollars and adjusted earnings per share of a dollar fifty six.
Chevron investors want to hear about the company's long delayed
but now completed acquisition of Hess and how that'll impact
(05:17):
its share buyback plans. Bloomberg consensus calls for revenue of
forty six point seventy five billion on adjusted earnings per
share of a dollar seventy one. Tom buzzby Bloomberg.
Speaker 11 (05:27):
Radio, All right, Tom, Thanks.
Speaker 2 (05:28):
A busy week on the economic front concludes this morning
with the July jobs report. Economists are forecasting a gain
of one hundred and four thousand jobs at an unemployment
rate of four point two percent. Begin more with Bloomberg's
Michael McKee.
Speaker 12 (05:40):
Job growth will slow and unemployment will have ticked up
in July, economists forecasts. But it's not the end of
the world or even the economic expansion. Once again, it's tariffs.
Companies have been suspending guidance and announcing price increases to
offset tariffs, but they have not yet resorted to cutting jobs.
It won't matter much to the FAD if unemployment does
rise by a tenth or so, but a quick jump
(06:02):
to say four and a half percent, would worry policymakers,
who may take it as a signal policy is too tight.
There will be time to consider the implications no matter
what we get. The next FED meeting is not until
September seventeenth. Michael McKee, Bloomberg radio.
Speaker 3 (06:17):
All right, Mike, thanks and speaking of the Fed, President
Trump is keeping up his pressure campaign on j. Powell
to lower rates, once again, taking to social media to
criticize the FED chair. Lyle Brainerd is a former vice
chair of the Federal Reserve.
Speaker 13 (06:30):
What has been surprising to me is to hear the
President talk about lowering rates as though it is the
Federal Reserves responsibility to lower rates for US Treasury debt management.
And that, of course, is exactly how central banks go
wrong in emerging markets.
Speaker 3 (06:52):
Former FED Vice chair Lyle brainer also says she thinks
the President's higher tariff rates will hamper economic growth.
Speaker 2 (06:59):
And finally, Nathan and of an Era, Ray Dalio has
sold his last remaining stake in Bridgewater Associates and also
left the hedge Funds board. Dalio first announced his succession
plan more than a decade ago, but he did not
fully hand over the rains until twenty twenty two, when
he transferred his voting rights to its board of directors
and stepped down as one of its three co chief
investment officers. He stayed on the board at the time,
(07:21):
and Dalio founded the firm in nineteen seventy five. Time
now for a look at some of the other stories
making news in New York and around the.
Speaker 6 (07:30):
World, and for that we're joined by Bloomberg's and Michael Barr. Michael,
good Morning, Good morning, Karen.
Speaker 14 (07:34):
Storms have been lashing the East Coast from Virginia to Connecticut,
flooding roadways in New York. Vehicles were stranded in pockets
of high water and water pouring over a train in
Manhattan's Grand Central Terminal. Commuter rail lines into suburban Long
Island and New Jersey were suspended in places, flash flood
(07:55):
warnings and effect for parts of New York City, New Jersey,
and Philadelphia. States of emergency have been declared in New
Jersey and New York City. With more on the weather,
here's Bloomberg meete religius Craig Allen.
Speaker 15 (08:08):
The delus from last evening. That's gone. There are still
some showers around. They'll be moving out of the area.
All flood alerts have been canceled. I mean, it must
have been frightening for some of those caught in the
flooding range that caused the flash flooding on some of
the major interstates around the region.
Speaker 14 (08:24):
Bloomberg Media relogist Craig Allen. The storms delayed flights from
Boston to Washington, d C. The NYPD and politicians gathered
at the funeral Thursday for the officer killed in the
Midtown Manhattan mass shooting this week. Ditital Islam was off
duty working security when he was fatally shot by a
gunman at three forty five Park Avenue. Islam is one
(08:47):
of three funerals these past few days. Also yesterday, funeral
services took place for Blackstone executive Wesley Lapatner. Her fourteen
year old daughter gave the eulogy.
Speaker 11 (08:58):
My mom was like my Rocky.
Speaker 2 (09:01):
I would talk to her and I can't or canny news,
nothing else would make it better.
Speaker 14 (09:08):
Funeral services were held for Roudent employee Julia Hyman on Wednesday.
Israel's military intelligence agency is undergoing changes. The service is
making profound revisions, including reviving an Arabic language recruitment program
for high school students and training all troops in Arabic
and Islam. It comes after the October seventh, twenty twenty
(09:30):
three attack by hamas global news twenty four hours a
day and whenever you want it with the Bloomberg News
Now Michael Barr and this is Bloomberg.
Speaker 6 (09:38):
Karen all right, Michael Barr, thank you.
Speaker 2 (09:44):
Time now for the Bloombergy sports Okay, brought to you
by Flushing Bank, and here's John stash Hour.
Speaker 6 (09:49):
John, good morning, Good morning, careen.
Speaker 16 (09:50):
It was let's make a deal day throughout baseball and
perhaps no team busier just before the trade deadline than
the Yankees. They had already added three players. They added
four more. There are three relief pitchers. David Bednar was
a two time All Star in Pittsburgh. Camillo de Val
had over one hundred career saves, while in San Francisco,
Jake Bird comes from Colorado. And then in the eighth
inning of the Yanks seven to four went over Tampa Bay.
(10:13):
They acquired a player who was in the opposing dugout.
Jose Caballero has been Baseball's best base dealer of the
past two seasons. Aaron Boom impressed with what the front office,
SA chief.
Speaker 11 (10:23):
Love what they were able to do.
Speaker 17 (10:25):
I think we're a better club today than yesterday, and
certainly today than we were last week. And now we
know what we were going with and what we got,
you know.
Speaker 16 (10:39):
Onward, they win over the Rays the third in a row.
They jumped to a seven nothing lead. It was seven
to four when there was a rain delay of nearly
three hours and then no scoring after that. Yanks down
three and a half behind Toronto, playing tonight in Miami
and the Metz Hosta Giants. Mets have a new center fielder,
Cedric Mullin spent eight seasons in Baltimore. A few years ago,
had thirty home runs and stolen bases. Carlos Correa, going
from Minnesota back to Houston, where he spent seven years,
(11:02):
helped the Astros win a World Series. The Red Sox
landed pitcher Dustin May from the Dodgers. They beaten May
in a game a few days ago at Benway. Taylor Rogers,
whose twin brother Tyler was just acquired by the Mets,
was traded for the second day in a row. He's
touring the NL Central, went from Cincinnati to Pittsburgh and
now the Cubs. A year ago, the Knicks sent a
boatload of draft picks to the Nets from Michel Bridges.
(11:24):
He averaged eighteen points a game, led the NBA AD
minutes played in. Bridges now has a new contract with
the Knicks four years, one hundred and fifty million, he
has never missed a game in his seven year career.
Speaker 11 (11:35):
John Staneshawer Bloomberg Sports.
Speaker 1 (11:39):
Coast to Coast on Bloomberg Radio, nationwide on Sirius XM,
and around the world on Bloomberg dot Com and the
Bloomberg Business Altum. This is Bloomberg Daybreak.
Speaker 3 (11:49):
Good morning, I'm Nathan Hager here. It is August first,
and as promised, President Donald Trump has announced a slew
of new terror frights on countries around the world, after
announcing deals with a handful of them in recent weeks.
But former US trade negotiator Steven Olsen says he wouldn't
call these deals.
Speaker 18 (12:07):
What we've got here are a series of extremely vague
framework agreements which will require additional negotiations before they're actually
translated into anything even approximating well, we could legitimately refer
to a trade agreement.
Speaker 3 (12:24):
Steven Olsen is now a senior fellow at the Institute
of Southeast Asian Studies and for more. We're joined this
morning by Bloomberg News Senior editor Bill Ferries. So, Bill,
what do we have this morning?
Speaker 11 (12:34):
Good morning, Good morning. So yeah, we're here.
Speaker 19 (12:38):
It's been a long bumpy road since those April second
Liberation Day tariffs were first announced, We've seen a lot
of pauses and fits and starts since then. This does
seem to be a kind of the moment.
Speaker 14 (12:52):
Now.
Speaker 19 (12:52):
President Trump, as you said, unleashed a whole slew of tariffs,
some some big surprises in there, some countries getting more
than they bargained for, and I think the baseline rate
of ten percent kind of a pleasant surprise to other
countries who maybe had been expecting that to increase. So
the market's kind of still digesting this, and it's you know,
(13:17):
there's still countries, big, big outliers there like China and
India still looking to make deals. So it does seem
like the deadline has been reached, but there's still going
to be a lot going on in the days and
weeks in head.
Speaker 3 (13:30):
Well, let's get into that. What could we see over
the next few days here, particularly when we're seeing you know,
some countries like Switzerland and Canada getting hit with much
higher rates than that ten percent baseline you just mentioned.
Speaker 19 (13:44):
Yeah, I think those are two of the big surprises,
particularly Switzerland getting a thirty nine percent tariff when you
consider that many of its neighbors who are EU nations
got about a fifteen percent. Switzerland, of course, exports huge
amount of pharmaceuticals to the US, so that's going to
have an immediate hit on drug prices once that comes
(14:06):
into effect August seventh. And out in Asia, you've seen
countries or governments like Taiwan getting twenty percent, while two
of its biggest rivals, Japan and South Korea, were at
fifteen percent. So the effect of these tariffs as it
plays out in the days and weeks ahead, is going
to be shifting kind of the competitive landscape between countries
(14:30):
that may you know, have typically competed in similar products
but have different rates when it comes to exporting to
the US.
Speaker 3 (14:36):
To your point, I guess we've heard from Taiwan as
well that they consider that twenty percent rate that you
just mentioned temporary and that more negotiations could be to come.
Is that what we should expect here, that even more
of these countries could keep negotiating even after this August
first deadline that's coming gone.
Speaker 19 (14:55):
Yeah, I mean, so the August first deadline that will
those tariffs are sposed to kick in August seventh. In theory,
I think there's going to be time there to negotiate
But last, yes, I think nations, if they've learned anything
about President Trump, it's that he's a deal maker. He
likes to make deals. They the White House may feel
like it has made those deals. But I think if
(15:16):
a if a country comes in, if India or a
Taiwan comes in, and they say, you know, they find
a way to perhaps buy more American products or or
make some changes. I don't think that down the road
we're you know, I think down the road, I think
we're going to see more deals getting tweaked. And that's
(15:36):
what a lot of governments are going to be banking
on going forward.
Speaker 3 (15:40):
So if we do see these terrif rates kicking in,
as you mentioned on August seventh, once the US Customs
and Border Protection gets that time to adjust to this,
what's the potential economic impact from where these terif rates lie.
Speaker 19 (15:57):
Now it's a huge global economic experiment and an experiment
for the US economy. I mean, these tariffs, these US
tariffs are now going to be at the highest rate
since World War Two. And even if some countries are
breathing a sigh of relief that they got just ten percent,
and I'm thinking, you know, countries like Singapore for instance,
ten percent. The average US tariff was about two percent
(16:21):
six months ago. So these are huge changes and they
will continue to trickle through into the US economy and
it's hard to not see that starting to affect inflation
more seriously in the months ahead.
Speaker 3 (16:34):
And on top of all this bill, I guess we're
still waiting for a lot of sectoral tariff announcements as well.
I mean, what could that mean when it comes to
certainty in the market.
Speaker 19 (16:46):
Yeah, there is still a lot of uncertainty. There are
products pharmaceuticals are chief among them, semiconductors, those are still
being subject to what the US calls these Section two
three two investigations to see if there's a national security risk,
and presumably if there are, that allows Donald Trump to
(17:08):
put additional tariffs on those products. So, by no means
is this the end of it, just because countries have
gotten their number some of the products they export Switzerland
I said thirty nine percent, but a big pharma exporter,
they could be seen increased tariffs on those products once
the US reaches those decisions.
Speaker 3 (17:29):
And not the end of it, but maybe the market
adjustment to what's happening now is just beginning. Thank you.
Speaker 14 (17:34):
For this.
Speaker 3 (17:35):
Bloomberg News Senior editor Bill ferries with us on this
August first, Karen.
Speaker 2 (17:40):
Nathan, we're also focusing on the markets in big tech
earnings this morning. Shares of Amazon, they are down more
than eight percent, Apple up. It's higher by almost two
percent right now. And this follows yesterday's After the Bell
reports for more, We're pleased to welcome Bloomberg Radio and
TV anchor Kreedie Goopta Creedy.
Speaker 6 (17:59):
Good morning, Hey, Chriatie.
Speaker 2 (18:00):
Let's start with Amazon, because it's really hard to ignore
the stock move this morning.
Speaker 6 (18:04):
What are investors reacting to?
Speaker 20 (18:06):
Good morning, Karen, Yeah, it's been a really interesting tech
earning story, A tale of two. I think is fair
to say Amazon cheres down by eight percent, treating about
two hundred and fifteen.
Speaker 11 (18:14):
Dollars a share.
Speaker 20 (18:15):
This is all about weakness when it comes to Amazon
Web services. When you think Amazon, we think about the packages,
we think about the e commerce business. But ultimately they
are pivoting firmly in the tech direction and that's where
they've disappointed the market.
Speaker 1 (18:28):
Now.
Speaker 20 (18:28):
It doesn't help that we also got Microsoft earnings just
twenty four hours before, which really set a positive tone
for cloud adoption for the Asia kind of services that
they had, So the expectations were pretty high for Amazon
to impress the market, and to be fair, they did
in some ways. Their revenues did come in better than expected,
but not by much. And this is a market that
(18:50):
is very tough on tech companies right now that the
expectations are high and you have to be even better
than the expectations. You have to get an A plus
plus instead of just and a plus. And this is
where Amazon kind of finds itself right now because they're
also talking about weaker than expected operating income as well
as some of the sales growth when it comes to aws.
Speaker 11 (19:10):
So that big idea of spend.
Speaker 20 (19:12):
Big on AI, spend big on cloud and see that
kind of multiply ultimately over time. That's the shadow of
doubt that's being cast from Wall Street this morning.
Speaker 2 (19:21):
And it really did seem like CEO Andy Jasse he
had a longer view when it came to all of this,
but he still couldn't ease those concerns on the earnings call,
could he?
Speaker 11 (19:30):
He couldn't.
Speaker 20 (19:30):
He's trying to use that magic word that I think
we've seen and not just the tech companies in the
tech space, but across corporate America and arguably the global
corporate sphere, which is artificial intelligence. And there was an
era where every time you said artificial intelligence, the stock
would just spike because of this kind of momentum driven story.
And he's making that point. He says, look, we're very
early days in that investment story. We know Amazon has
(19:51):
that massive anthropic venture as well, and they are competing
with the likes of Alphabet, Microsoft, Oracle among others as
well in the out space.
Speaker 11 (20:00):
There. He's saying, give it some time.
Speaker 20 (20:03):
But this is now at a point where Wall Street
is looking at these AI kind of expectations, looking at
these AI investments and say when is it going to
pay off? And Andy Jesse wasn't able to make that case.
Speaker 2 (20:14):
All right, well, we're seeing better reaction to Apple this
morning it reported fastest revenue growth in more than three years.
Speaker 6 (20:19):
What else did you take away from this?
Speaker 20 (20:21):
You know, it's funny because we go into Amazon with
such a strong earnings expectations. With Apple, you went in
with some pretty beat up earnings expectations.
Speaker 11 (20:30):
The idea that the tariff story would really.
Speaker 20 (20:32):
Eat into the bottom line, would eat into the supply chains,
especially as Apple tries to move their supply chain from
China to India. And you actually saw the opposite on
two key fronts. One that so much of those tariffears
actually showed up and people buying iPhones ahead of time
expecting the prices to go up, So that was good
news for their bottom line revenue. But also the fact
that they are actually doing better than expected in China.
(20:55):
And this has been a key sticking point for Apple.
Because Apple is ultimately an American lug product, there are
plenty of competitors in Asia as well, and they haven't
been able to have the foothold and the growth in
that part of the world that they were really hoping for,
to the point that just this week has been reported
that they shuttered their first retail store in China, really
kind of showing that weakness that they've had there. I
(21:16):
think it's crucial though, that Apple has at least today
convinced investors that is no longer the narrative. The question
now moving forward is cand of sustain that growth in
the iPhone picture, but also in Asia.
Speaker 2 (21:27):
This is Bloomberg day Break, your morning podcast on the
stories making news from Wall Street to Washington and beyond.
Speaker 3 (21:34):
Look for us on your podcast feed by six am
Eastern each morning, on Apple, Spotify, or anywhere else you listen.
Speaker 2 (21:40):
You can also listen live each morning starting at five
am Wall Street Time on Bloomberg eleven three to zero
in New York, Bloomberg ninety nine to one in Washington,
Bloomberg ninety two to nine in Boston, and nationwide on
serious XM Channel one twenty one.
Speaker 3 (21:55):
Plus listen coast to coast on the Bloomberg Business app
Now with Apple CarPlay and Android Otto.
Speaker 2 (22:00):
And don't forget to subscribe to Bloomberg News Now. It's
the latest news whenever you want it in five minutes
or less. Search Bloomberg News Now on your favorite podcast
platform to stay informed all day long. I'm Karen Moscow.
Speaker 3 (22:13):
And I'm Nathan Hager. Join us again tomorrow morning for
all the news you need to start your day right
here on Bloomberg Day Ray
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