Treasury Rally Pauses After Rush to Safety; Oil Extends Gain Amid Supply Woes

VONNIE: 5:00 A.M. IN NEW YORK CITY, 10:00 A.M. IN LONDON, VONNIE QUINN WITH YOUR BLOOMBERG BRIEF, LET'S GET YOU SET UP FOR THE DAY. MASTEC FUTURES ARE IN THE GREEN NOW. OIL ON TRACK FOR A THIRD WEEKLY GAIN AS ESCALATING ATTACKS ON SAUDI ARABIA HEIGHTENED SUPPLY RISKS. AND TOWER COMPANIES GAINING PREMARKET OR SPACEX LOOKS TO ACCESS 80,000 CELL SITES ACROSS THE UNITED STATES. LET'S GO CHECK ON MARKETS AROUND THE WORLD BEGINNING IN THE ALL-CRUCIAL ASIA FOR THE ASIA SESSION WITH WINNIE. WINNIE: STOCKS WERE IN NEGATIVE TERRITORY THIS MORNING BUT NOW PRETTY MUCH TRADING FLAT. THE REBOUND FIRST BEING LED BY SOUTH KOREA'S KOSPI INDEX WHICH IS DOWN AS 4% EARLIER TODAY THAT ENDED IN THE GREEN SUPPORTED BY THE GAINS WE SAW IN SK HYNIX, WHICH CANCELED THE U.S. IPO PLAN AND THAT WAS SEEN AS A POSITIVE FOR THE CORPORATE GOVERNANCE AND SIMILAR MOVES WE SAW FOR THE ONSHORE CSI 300 BENCHMARK, WHICH ALSO SUPPORTED BY THE BUYING BY THE NATIONAL TEAM. HOWEVER, THE CSI 300 HAS BEEN FALLING FOR 11 WEEKS NOW COME THE LONGEST SUCH A STREAK ON RECORD, SHOWING YOU HOW PESSIMISTIC THE VIEW IS STILL FOR CHINESE EQUITIES AS INVESTORS CONTINUE TO QUESTION THE SUSTAINABILITY OF AI. WE'RE SEEING MONEY FLOWING INTO HAVEN ASSETS. WE CONTINUE TO SEE DEALS IN JAPAN FOLLOWING ACROSS THE CURVE. THE JAPANESE YEN COVERING BELOW THE DOLLAR AFTER THE BIG JUMP YESTERDAY. WE DID HAVE CPI COMING THROUGH ABOVE THE BANK OF JAPAN'S TARGET LEVEL OF THE FIRST TIME THIS YEAR. IT DOES SUPPORT THE RATE HIKE CASE FOR DECEMBER, BUT FOR NOW EXPECTING A HOLD NEXT WEEK. VONNIE: WINNIE HSU FINISHING THE WEEK IN ASIA. THE EUROPEAN SESSION SO FAR WITH JUSTINA LEE. JUSTINA: SOME CALM RETURNED TO MARKET. THE STOXX 600 IS STILL DOWN TODAY. SOME BAD NUMBERS ARE ALSO DRAGGING DOWN THE FRENCH BENCHMARK CAC 40, DOWN 0.7%. A LOT OF PEOPLE IN FRANCE ARE PROBABLY HAPPY TO SEE THAT. FRENCH BASIS POINTS ARE DOWN TWO BASIS POINTS EVEN WITH THE TREASURE VALLEY PAUSING. I COULD BE RELATED TO THE FACT WE HAVE SOME PRETTY BAD PMI NUMBERS GENERALLY OUT OF EUROPE. IF WE FELT THE BOARD AND LOOK AT FRANCE'S COMPOSITE PMI NUMBERS IN PARTICULAR, WE CAN SEE HERE IT IS STILL BELOW 50, WHICH IS THE DIVIDING LINE BETWEEN EXPANSION AND CONTRACTION AND ALSO FOR THE EURO ZONE IN AGGREGATE THE NUMBERS WERE ALSO WORSE THAN EXPECTED. THIS KINDA HIGHLIGHTS SOME PRESSURES HERE, ESPECIALLY IN FRANCE, WHICH IS FACING A LOT OF POLITICAL UNCERTAINTY. VONNIE: A MASSIVE POLICE AND MILITARY PRESENCE. THAT IS JUSTINA IN LONDON. LET'S CHECK THE UNITED STATES, BECAUSE OBVIOUSLY SAW THAT MASSIVE, MASSIVE TREASURY RALLY WHICH SENT YIELDS 15 TO 20 BASIS POINTS LOWER ACROSS THE CURVE YESTERDAY. WELL, IT'S ALL COMING TO BEAR FRUIT IN THE MARKET AS WELL. THE NASDAQ 100 FUTURES ARE BOUNCING BACK BUT WE ARE SEEING SLIGHT DECLINES IN THE S&P 500, AND RUSSELL 2000 FUTURES IN THE SESSION. YOU MAY KNOW THAT YESTERDAY WE SAW 3% DROP FOR THE NASDAQ. THE STOCKS INDEX WAS DOWN SIX POINT 7%, WHICH BASICALLY TELLS YOU ALL YOU NEED TO KNOW ABOUT THE EQUITY PORTION OF THE STRAIT. INVESTORS ARE FLEEING AND CONTINUING TO FLEE. STOCKS DOWN EIGHT OF THE LAST 10 SESSIONS TESTING IS 200 DAY MOVING AVERAGE NOW. IF YOU LOOK AT THE KUWAIT S&P 500 WE HAD AGAIN YESTERDAY UP THREE QUARTERS 1%. CONSUMER STAPLES ARE ACTUALLY AT A RECORD. LET'S LOOK AT THE YIELDS. BACK BELOW 5% THOUGH WE ARE OF TWO BASIS POINTS THIS MORNING AND THE CREEPING UP ON THE LONG END. FIVE POINT 30, WE WERE WELL BELOW THAT -- 5.30, WE WERE WELL BELOW THAT INDUSTRY DAY SESSION. $130 A BARREL ON BRENT APPROACHING $114. IT DOESN'T LOOK LIKE ANYTHING IS SETTLING IN THE MIDDLE EAST. ABOUT 100 ON WTI. EUROPEAN GAS FUTURES 93 AND CHANGE PER MEGAWATT HOUR NOT ANY CONSOLATION TO EUROPEAN GAS USERS, NOR U.S. GAS USERS JUST THE WEEKEND A BIT OUT FROM THE TERMS. THE VIX TRADING IN A 19 HANDLE AS WELL. LET'S GET SOME INDIVIDUAL MOVERS. FOR THAT WE WILL GO TO LONDON AND ALEX MORGAN. ALEX: HAPPY FRIDAY. LET'S PLUNGE IN FEET FIRST. LOOKING INTO THE OWNER OF BRANDS LIKE DECKERS, WE HAD CUTS TO SALES GUIDANCE, PUTTING THEM DOWN AROUND 9% PREMARKET. WE HAVE A BIT OF A SEESAW GOING ON WHEN IT COMES TO TOWERS AND CARRIERS. THIS ON THE BACK OF THE NEWS THAT SPACEX WANTS TO ACQUIRE 80,000 CELL TOWER SITES PUTTING TOWERS UP CARRIERS DOWN. SPACEX'S OVERALL AIM ACCORDING TO SOURCES IS TO BECOME THE FOURTH NETWORK PROVIDER. VOLVO CAR REALLY PLUNGING HERE IN EUROPE. THE U.S. ANTI-TEARS BEING ONE PART OF THAT, BUT REALLY IT'S CHINA. THE SALES INTO CHINA COME DELIVERIES INTO CHINA CARRY -- INTO CHINA CRATERING. VONNIE: SAYING CHINA IS DONE AS A MARKET FOR EUROPEAN CARMAKERS. QUITE A STATEMENT. WILL GIVE MORE MARKET VOLATILITY IN THE TREASURY RALLY WITH LAURA COOPER OF NUVEEN. IT IS SLOWING AFTER INVESTORS RUSHED TO SAFETY AND YESTERDAY'S TRADE WELL AI-RELATED SHARES SANK. IT IS A FRIDAY. SOMETIMES YOU SEE BUYING AT THE VERY END OF A FRIDAY, IN PARTICULAR WHEN INVESTORS THINK THE DIP IS DONE. COULD WE SEE THAT TODAY OR A REALLY SOUR THIS WEEK? >> I THINK SENTIMENT HAS DEFINITELY GONE SOUR THIS WEEK WHEN IT COMES TO THE AI TRADE. WE DID SEE THAT GOING BACK AND FORTH. IT HAS BEEN VERY VOLATILE. THE TRAJECTORY HAS CERTAINLY BEEN LOWER AND WE SEE A BRIEF RESPITE IN EUROPEAN TRADING THIS MORNING FOR TECHNOLOGY STOCKS. VERY QUICKLY FADE. WE WOULD SEE THAT FILTER THROUGH. SEEING THE STOCKS POINTING LOWER IN THE FUTURES AS WELL. AND THE GLOBAL BOND TRADE I THINK IS REALLY BEEN THE STORY THIS WEEK AS WE HAVE SEEN INVESTORS PILING INTO WHAT THEY PERCEIVED TO BE THE HAVEN FIXED INCOME. IT'S INTERESTING TO SEE IT AS A PAIR TO THE AI TRADE. USUALLY SEE ROTATION WITHIN STOCKS BUT THIS IS REALLY SHOWING HOW INTRINSIC NOW THE AI TRADE HAS BECOME TO THE U.S. ECONOMY. S SERIOUS CONCERNS ABOUT THAT SUSTAINABILITYO HAS BEEN FLOWING THROUGH INTO EXPECTATIONS ABOUT INTEREST RATE HIKES. THAT IS -- THAT PULLING BACK HAS BEEN DRIVING YIELDS MUCH LOWER IN THE U.S. AND IN SOME EUROPEAN COUNTRIES, AND ASIA AS WELL. VONNIE: IT IS FASCINATING. WHAT ARE INVESTORS AND STRATEGISTS SAYING ABOUT THIS CORRELATION? ON ONE HAND THE AI TRADE IS DRIVING YIELDS LOWER, AND AT THE SAME TIME YOU KNOW, CREDIT RISK IS GETTING A LITTLE MORE INTENSE WHEN IT COMES TO SOME OF THESE AI NAMES. COULD WE HAVE A DIVERGENCE BETWEEN SOVEREIGN DEBT AND CREDIT? MORWENNA: THAT'S VERY TRUE. OBVIOUSLY FIXED INCOME IS MORE TIED TO THE GENERAL ECONOMY AND CENTRAL BANKS. THE OTHERS ABOUT THE RISK PLACED BY THOSE COMPANIES. DEFINITELY WOULD SEE THOSE BEING TREATED QUITE DIFFERENTLY BY THE MARKET. EVEN THOUGH THEY DO SEEM INTRINSICALLY LINKED AT THE MOMENT IN THAT TRADE. I THINK WE ARE SEEING CREDIT RISK INCREASING FOR THOSE COMPANIES, AS YOU SAY, WHILE IT STILL APPEARS TO BE A TYPE FOR SOVEREIGN DEBT IS HOLDING INTO THE WEEKEND SO FAR. VONNIE: EXACTLY. THANK YOU. THAT IS BLOOMBERG'S MORWENNA CONIAM. OPENAI LOOKING TO RAISE $30 BILLION IN FRESH FUNDING, THE COMPANY TARGETING A VALUATION OF ONE POINT TWO $5 TRILLION DOWN A LITTLE FROM THE $1.4 TRILLION IT WAS SEEKING LAST MONTH BUT UP PRETTY SUBSTANTIALLY FROM WHAT HE WAS LOOKING FOR IN MARCH. THESE FUNDING ROUNDS ARE GIVING US SOME IDEA OF SENTIMENT AND HOW IT IS CHANGING THROUGH THE YEAR, BUT IT LOOKS LIKE IT HAS NOT FULLY FALLEN. DOWN WITH THIS AROUND BUT NOT BY A MASSIVE AMOUNT. WHAT IS IT SAYING ABOUT THE AI TRADE? >> GOOD MORNING. THAT REALLY REFLECTS A RECALIBRATION IN INVESTOR EXPECTATIONS IN TERMS OF THE EVALUATION THEY ARE WILLING TO PAY FOR SOME OF THE AI STOCKS. THEY HAVE BEEN DOMINATING THE CONVERSATION IN TERMS OF THE IPO. THEY COULD HAVE BEEN FEASIBLE THEY DEMANDED A HIGHER VALUATION OF THE RECENTLY WITH THE CELLOPHANE CONCERNS AROUND FINANCING AND AT THE HURDLE RATE OF INVESTMENT IT'S NATURAL THAT YOU ARE SEEING A RECALIBRATION IN TERMS OF EXPECTATIONS AND APPETITE TO PAY SOME OF THOSE PEAK MULTIPLES. VONNIE: CHRIS FROM BLOOMBERG OPINION WRITES THAT ANTHROPIC WILL BE THE ASSET TEST FOR AI SENTIMENT. WE WILL SEE WHAT HAPPENS WHEN IT GOES PUBLIC. SPACEX LOOKING TO ACQUIRE 18,000 CELL SITES BUT IT IS, GOING TO WEAR SUBSCRIBERS ARE ALREADY IN NOT NECESSARILY TO WHERE CONNECTIVITY IS NEEDED. WHO IS IT TALKING TO? RUHELL: I THINK IT'S REALLY INTERESTING ONE, BECAUSE THERE HAS BEEN SOME SPECULATION THAT ACTUALLY SPACEX IS TRYING TO DEVELOP THE FOURTH LARGEST NATIONWIDE NETWORK. THIS REALLY POINTS TO THAT. WE KNOW THE CONNECTIVITY SEGMENT IS A BIG SEGMENT, GENERATE ABOUT $5.2 BILLION IN SALES. VERY PROFITABLE. THEY HAVE THE ECONOMICS, CASH, SCALE, AND BALANCE SHEET TO REALLY BUILD THIS OUT AND THAT'S PARTLY WHY YOU ARE SEEING SOME OF THE TELCO NAMES MOVE LOWER IN THE PREMARKET BECAUSE OF THIS CONCERN ABOUT MORE COMPETITION. VONNIE: ELON MUSK BECOMING THE CELL COWBOY AT THIS POINT. WESTERN DIGITAL, THE MEMORY MAKER DROPPING THE FIRST TIME WE'VE SEEN PRETTY NEGATIVE RESULTS, OR AT LEAST NEGATIVE SENTIMENT AFTER THE MEMORY MAKER REPORTS IN THE LAST WHILE. WHAT IS IMPORTANT FOR THE REST OF THE MEMORY MAKERS -- WHAT DOES IT PORTEND FOR THE REST OF THE MEMORY MAKERS? RUHELL: A COUPLE OF THINGS ARE CAUSING SOME CONSTERNATION IN THE MARKET. THE FIRST IS THE COMPETITION COMMENTS THAT MANAGEMENT MADE. THEY ARE SEEING HEIGHTENED AND INCREASED COMPETITION AROUND RAMP AND THAT IS ADDING TO FEARS. THE SECOND IS MANAGEMENT. CAPEX IS GOING TO BE ELEVATED AROUND 4% TO 6% OF SALES. THAT IS TRADING ON HIGH DOUBLE-DIGIT MULTIPLES. YOU ARE GOING TO SEE A LITTLE OF A PULLBACK BECAUSE IT IS TRADING AT VERY MUCH PREMIUM TO -- TO THE PEER GROUP. VONNIE: THANK YOU FOR JOINING US. THAT IS RUHELL AMIN. BRENT HEADED FOR $114 A BARREL. IRAN BACKED HOUTHI ATTACKS. THE STRAIT OF HORMUZ CRUDE EXPORTS JUST REACHING PREWAR LEVELS. IT ISN'T JUST THE WHO THESE. IT IS THE THREAT WE COULD SEE A RESTART TO KINETIC WARFARE AFTER THE MIDTERMS WHICH ARE A COUPLE WEEKS AWAY. ABEER: YOU'RE RIGHT. MULTIPLE REPORTS AND ESCALATING RHETORIC AROUND THE RE -ESCALATION OF THE WAR. REPORTS THAT ISRAEL IN THE UNITED STATES ARE PLANNING TO GET BACK TO HITTING IRAN. NOVEMBER 3 IS THE DATE THE MIDTERMS HAPPEN. THE FOREIGN MINISTER OF IRAN IN AN OP-ED IN THE FINANCIAL TIMES THAT IS THE U.S., IF ISRAEL COMES BACK TO HITTING IRAN THE CONSEQUENCES WOULD BE DIRE. HE DIDN'T DISCOUNT IRAN WOULD HIT CIVILIAN TARGETS IN NEIGHBORING COUNTRIES AND THE CONSEQUENCES OF THAT WOULD CATCH UP TO THE GLOBAL ECONOMY. YOU HAVE AN ESCALATION IN THE RHETORIC AND THE PALE THOUGH SITUATION TAKING PLACE BETWEEN THE YEMEN-BASED HOUTHIS IN SAUDI ARABIA, THREE CASUALTIES IN THE KINGDOM. ONE IN THE AIRPORT, AN EASTERN PROVINCE AT AN ARAMCO FACILITY AND ARAMCO HEADQUARTERS TOLD HIM PLEASED TO WORK FROM HOME AFTER ALARMS WERE SOUNDED. WE DON'T KNOW THE REASON BEHIND THE ALARMS FOR YOUNG AND AN ESCALATION ON ALL FRONTS CREATING THE UPSIDE THAT YOU ARE SEEING ON BRENT CRUDE. THE PRICE DISRUPTIONS ON HORMUZ REMAIN IN PLACE AS WELL. VONNIE: BRIEFLY, ANY IDEA OF WE ARE PREWAR LEVELS STILL WITH ALL OF THESE THREATS OR IF WE HAVE SLOWED DOWN? ABEER: YEAH, SO THERE HAVE BEEN REPORTS ABOUT IRAN ACCORDING TO STATE MEDIA IN THE IRAN SAYING THAT ALL ILLICIT SHIPMENTS , ILLICIT CRUDE MOVEMENTS THROUGH THE STRAIT OF HORMUZ WILL BE HALTED OR HAVE BEEN HALTED, AND THAT ANY KIND OF ACTIVITY TO BRING ILLICIT CRUDE SHIPMENTS THROUGH THE STRAIT OF HORMUZ WILL ESSENTIALLY BE CONFRONTED BY THE IRGC. BUT FOR THE TIME BEING WE ARE STILL SEEING MOVEMENT THROUGH THE STRAIT OF HORMUZ WITH ALL OF THE CAVEATS THAT WE HAVE BEEN MENTIONING OVER THE PAST FEW MONTHS. THE FREIGHT LEVELS, INSURANCE, IT'S MUCH HIGHER. AGAIN, THE -- THE UPSIDE THAT YOU ARE SEEING IN PRICES THIS MORNING AND THE LAST THREE WEEKS IS THE PERCEIVED RISK THAT THINGS COULD GET MUCH WORSE VERY, VERY QUICKLY IF THE ESCALATION MORE TO RETURN IN THE WIDER PICTURE BETWEEN THE U.S. AND IRAN. VONNIE: THANK YOU VERY MUCH. ABEER ABU OMAR WITH EVERYTHING FROM THE MIDDLE EAST. OTHER TOP STORIES ON THE TERMINAL, FRENCH AUTHORITIES ARE PLANNING MILITARY PRESENCE TO BACKUP POLICE FOR PROTESTS EXPECTED SATURDAY. THEY SAY IT'S AN EFFORT TO STOP RIGHTS THAT LED TO THE LOOTING OF 3000 STORES IN NEARLY 3000 ARRESTS LAST WEEKEND. PRESIDENT MACRON SAID ONLY PROTESTS ORGANIZED BY LABOR UNIONS WILL BE APPROVED BY LOCAL AUTHORITIES. GOLDMAN SACHS SAYS GLOBAL HEDGE FUNDS SOMEONE OF THEIR BROADEST DECLINES SINCE THE PANDEMIC OF THEIR STAYS A GLOBAL SELLERS WERE DOWN 1.4% AT THE MARKET CLOSE. TELECOM, MEDIA, TECH-FOCUSED FUNDS FELL BY 2.7%. SHARES OF CARING PLUNGING AFTER GUCCI SALES PLUNGED. WEAKNESS IN CHINA CONSUMPTION UNDERMINED YEARS-LONG TURNAROUND EFFORTS. GUCCI'S PRODUCTS FAILED TO ENTICE SHOPPERS. COMING UP, WALL STREET WEEK, HEADING TO ARGENTINA ONE YEAR BEFORE THE NEXT ELECTION. WE LOOK AT THE NATION'S ECONOMY NEXT. THIS IS BLOOMBERG. ♪ VONNIE: THIS IS BLOOMBERG BRIEF, EN VONNIE QUINN IN NEW YORK. SINCE PRESIDENT JAVIER MILEI TOOK OFFICE IN ARGENTINA THEY HAVE SHED 250 THOUSAND PRIVATE-SECTOR JOBS AT THE SAME TIME THE ENERGY SECTOR BOOMS. ONE YEAR OUT FROM THE PRESIDENTIAL ELECTION WALL STREET WEEK TRAVEL TO ARGENTINA TO SEE FIRSTHAND THE TWO SPEED ECONOMY POSING HEADACHES FOR PRESIDENT JAVIER MILEI. >> THE QUESTION IS IF ARGENTINA CAN BE A PLACE THAT IS WORTH LIVING WITHOUT THOSE SECTORS BEING -- MAYBE NOT EXTREMELY PROSPEROUS -- BUT AT LEAST ON SURVIVAL MODE. JAVIER MILEI MAKE IT WRONG WHEN HE CLAIMS ARGENTINES SHOULD NOT CARE ABOUT THOSE SECTORS, BECAUSE WE ARE TALKING ABOUT TWO ARGENTINA'S. THE ARGENTINA DOING VERY WELL, WHICH IS ENERGY, MINING, AND FARMING. THEY ARE ALL THE CAPITAL-INTENSIVE SECTORS OF THE ECONOMY. THE ECONOMIES DOING BADLY ARE MANUFACTURING, RETAIL, CONSTRUCTION. THOSE ARE LABOR-INTENSIVE. THERE ARE A LOT OF ARGENTINES IN SECTORS THAT ARE DOING BADLY AND DO NOT HAVE GOVERNMENT ATTENTION. VONNIE: JOINING ME FOR MORE IS SIMON HAMPTON. YOU ARE IN ARGENTINA AND LITERALLY SAW THE TWO ECONOMIES FIRSTHAND. EXPLAIN THE DIFFERENCE BETWEEN BUENOS AIRES AND AN ENERGY BUILDING AREA. SIMON: IT IS QUITE STARK. IN BUENOS AIRES YOU ARE SEEING FACTOR HE'S SHUTTING DOWN MAKING THE STREETS A LOT QUIETER WHERE BUSINESSES ARE. WE WENT OUT TO PATAGONIA WHERE THE OIL BOOM IS REALLY HAPPENING AND IT IS A COMPLETELY DIFFERENT STORY. PEOPLE ARE FLOODING TO THOSE AREAS LOOKING FOR WORK. LOCAL GOVERNMENTS ARE HAVING TO TELL PEOPLE TO STOP COMING BECAUSE THEY ARE FULL. THERE IS CONSTRUCTION, THEY ARE BUILDING ROADS, THERE IS NEW HOUSING. ONE PERSON MOVED THERE FROM BUENOS AIRES AND TRIPLED HIS WAGES GOING TO WORK IN THE OIL DISTRICT. YOU ARE SEEING THIS FRAGMENTATION AND THE TWO ARGENTINE ECONOMY IS EMERGING. VONNIE: THE COUNTRY WILL POST GROWTH SO THE COUNTRY AS A WHOLE IS BENEFITING AS THE GUEST SAID FROM CAPITAL-INTENSIVE SECTORS BUT WHY IS JAVIER MILLET IGNORING MANUFACTURING, CONSTRUCTION, AND RETAIL? SIMON: JAVIER MILLET HAS A VISION. HE HAS BROUGHT DOWN SOME THINGS. HE HAS TIGHTENED PUBLIC SPENDING, BUT THERE IS A REALIGNMENT IN THE ECONOMY AND THAT IS ALWAYS GOING TO MAKE THINGS DIFFICULT FOR SOME SECTORS OF THE ECONOMY. HE'S TRYING TO TAKE THEM TO THIS PROMISED LAND THAT WILL LIFT EVERYONE UP, BUT IT'S TOUGH FOR A LOT OF PEOPLE TO SEE THAT VISION THROUGH AT THE MOMENT. VONNIE: TRADE DEALS AROUND THE WORLD TO SOME EXTENT HAVE HELPED ARGENTINA WHEN IT COMES TO AGRICULTURE, AT LEAST. I GUESS ENERGY TOO. IS THERE A GUARANTY THIS COULD CONTINUE IN A POST DONALD TRUMP ECONOMY? MILEI AND TRUMP HAVE BEEN VERY CLOSE. SIMON: THEY CERTAINLY HAVEN'T ARGENTINA BENEFITED FROM THAT. THEY LOOKED TO CHINA AS WELL AND SEEN INVESTMENT FROM CHINA. I THINK THERE IS HOPE THAT THIS CAN CONTINUE IN A POST-DONALD TRUMP ENVIRONMENT. WILL IT HAPPEN AND A POST JAVIER MILLET ENVIRONMENT IS STILL SOMETHING FOR ARGENTINA TO CONSIDER. VONNIE: I CAN'T WAIT TO SEE THE PIECE SO WE CAN HEAR MORE ABOUT THAT. SIMON HAMPTON OF WALL STREET WEEK WITH PLENTY OF OTHER STORIES AS WELL ON THE PROGRAM TODAY. TUNE INTO THIS EDITION OF WALL STREET WEEK AT 6:00 P.M. NEW YORK TIME, 11:00 P.M. LONDON TIME. COMING UP, A LOOK AT YOUR FRONT PAGE NEWS. THIS IS BLOOMBERG. ♪ VONNIE: THIS IS BLOOMBERG BRIEF, VONNIE QUINN IN NEW YORK, TIME FOR YOUR FRONT PAGE NEWS. THE NEW YORK TIMES SPOTLIGHTING PRESIDENT TRUMP'S DEFENSE OF THE OHIO GUBERNATORIAL CANDIDATE VIVEK RAMASWAMY'S ATTACK AD THAT HAS DRAWN CRITICISM FROM OTHER REPUBLICANS, INCLUDING OHIO'S GOVERNOR. IT FEATURES RAMASWAMY'S RIVAL'S ESTRANGED MOTHER. IT IS SAID TO BE EXPOSING A DEEP INTRAPARTY RIFT. MORE DEMOCRATS ARE VOTING IN PERSON AFTER DONALD TRUMP'S THREATS ABOUT MAIL-IN VOTING. IN WISCONSIN EARLY IN PERSON VOTING IS SURGING. IN GEORGIA REQUESTS FOR MAIL ARE DOWN 40%. NATIONALLY 15 MILLION HAVE ALREADY VOTING. THE FT REPORTING CALPERS IS BOOSTING EXPOSURE TO PRIVATE EQUITY. THE CALIFORNIA PENSION GIANT HAS TRADED LARGE EXPOSURE TO THE MAG 7 FOR SEVERAL HUNDRED COMPANIES. THAT IS YOUR FRONT PAGE NEWS. COMING UP, SPEAKING WITH LAURA COOPER OF NUVEEN ON THE TREASURY MARKET RALLY AND THE FLIGHT TO QUALITY. ♪ VONNIE: IT IS 5:30 A.M. IN NEW YORK CITY, 10:30 A.M. IN LONDON. GOOD MORNING. I AM VONNIE QUINN WITH YOUR "BLOOMBERG BRIEF." LET'S GET YOU SET UP FOR THE DAY. A TREASURY RALLY, A MASSIVE ONE TAKES A LITTLE PAUSE AFTER AN AI SELLOFF RUSHED INVESTORS TO SAFETY. OIL ON TRACK FOR A THIRD WEEKLY GAIN AS ESCALATING ATTACKS ON SAUDI ARABIA HEIGHTEN SUPPLY RISKS. AND TOWER COMPANIES GAINING IN THE PREMARKET AS SPACEX SAID TO BE LOOKING TO ACCESS 80,000 CELL SITES ACROSS THE UNITED STATES. NASDAQ 100 FUTURES BARELY HOLDING ONTO GAINS. WE WERE QUITE POSITIVE EARLIER BUT THIS JUST TELLS YOU THE E SENTIMENT OF THIS MARKET. THE NASDAQ 100 DROPPED 3%, IT'S WORSE TODAY SINCE JUNE. WE DID SEE THE EQUAL WEIGHTED S&P HIGHER IN YESTERDAY'S SESSION WITH CONSUMER STAPLES AT A RECORD. SEMIS THE ONE TO WATCH WHILE TESTING THEIR 200 DAY MOVING AVERAGE AND THE SOX DOWN, THAT IS EIGHT OUT OF 10 DAYS WHERE WE HAVE SEEN DECLINES. YIELDS TUMBLING ACROSS THE BOARD. UP ONLY BY ABOUT A BASIS POINT. 10 YEAR YIELD WELL ABOVE 5% ONCE AGAIN, TWO YEAR YIELD AT 4.65, AND THE AIR COMING OUT OF RATE HIKE BETS. LET'S TAKE A LOOKING OIL BECAUSE THAT IS QUITE CONCERNED. BRENT CRUDE WAS ABOVE 114 EMMA MUNGO, NEW YORK ACCRUED WELL ABOVE -- 114 A MOMENT AGO, NEW YORK CRUDE WELL ABOVE $100. LET'S GET SOME INDIVIDUAL MOVERS TO WATCH WITH ALEX MORGAN. >> LET'S PUT SOME NUMBERS TO THE HEADLINE ABOUT THAT SPACEX PUSH INTO SEEKING TO ACQUIRE 80,000 CELLULAR TOWERS. CROWN CASTLE, AMERICAN TOWER SURGING. TOWERS UP, CARRIERS DOWN. WE KNOW SPACEX'S OVERARCHING AIM IS TO BECOME THE FOURTH NOTE. CROWN CASTLE UP ABOUT 8% PREMARKET. AT&T DOWN AROUND 4%, 3% THIS MORNING. DECKERS, DISAPPOINTING OUTLOOK ON THEIR SALES HAS PUT THEM DOWN PREMARKET, DOWN AROUND 8%, 9% THIS MORNING. THEY OWN BRANDS LIKE UGG AND HOKA. THE EUROPEAN LUXURY SLUMP CONTINUUM. KERING, WE HAD THIRD QUARTER SALES NUMBERS FOR GUCCI THAT DISAPPOINTED THE MARKET, THEY ARE REALLY PLUNGING THIS MORNING. CHINA SEEN AS FLAT TO DISAPPOINTING, THE U.S. AS WELL ALSO DIFFICULT FOR EUROPEAN LUXURY NAMES. VONNIE: THANK YOU SO MUCH FOR THAT AND ALL THAT CONTEXT WITH PREMARKET MOVERS. JOINING US NOW, LAURA COOPER, GLOBAL INVESTMENT STRATEGIST AND AHEAD OF MACRO CREDIT AT NUVEEN. WE HAVE TO LOOK AT THIS WEEK. SOME UP THE SENTIMENT AND WHAT MOVED THE MARKET IS? BECAUSE IT DOES FEEL DIFFERENT FROM -- SUM UP THE SENTIMENT AND WHAT MOVED THE MARKETS THIS WEEK? LAURA: WE DID SEE RENEWED GEOPOLITICAL TENSIONS AND THE POTENTIAL RISK OF ESCALATION ON THAT FRONT AFTER THE MIDTERMS ALONGSIDE INVESTOR JITTERS AROUND THE SUSTAINABILITY OF THE CAPEX TRADE. WE SAW TECH STOCKS COME UNDER PRESSURE IN PARTICULAR, OIL PRICES HIGHER, AND OF COURSE WE SAW THAT FLIGHT TO SAFETY IN TERMS OF THE BID FOR TREASURIES. I STRUGGLE TO SEE A MATERIAL SHIFT IN FUNDAMENTALS, PREDOMINANTLY LOOKING AT THE BOND MARKETS. I THINK A LOT OF THAT MOVE WAS LIKELY MORE IN THE SYSTEMATIC KIND OF SHORT COVERING RELATIVE TO WHAT WE ARE STILL SEEING. THERE IS STILL CONCERNS AROUND FISCAL SUSTAINABILITY, THE HAIR TERM PREMIUM TO CAPTURE THE INFLATION AND POLICY UNCERTAINTY SO I DON'T THINK NECESSARILY WE HAVE SEEN A MEANINGFUL SHIFT IN THE TRAJECTORY OF YIELDS FROM HERE? VONNIE: IS THIS JUST BECAUSE OF A I JITTERS AND YOU ARE SAYING WE WILL SEE THOSE YIELDS RISE, PARTICULARLY AT THE LONG END ONCE AGAIN IF THE JITTERS PASS OR BOND INVESTORS MOVE ON? LAURA: I DON'T THINK THERE IS A NEAR-TERM CATALYST TO TRIGGER ANOTHER SELLOFF IN RATES IN PARTICULAR, BUT I DON'T THINK WE ARE GOING TO SEE A MEANINGFUL RALLY, PARTICULARLY IN DURATION AT THIS JUNCTURE SO LONG AS WE CONTINUE TO SEE SIGNS OF U.S. ECONOMIC RESILIENCE. WE HAVE PMI INDICATORS OUT LATER THAT ARE LIKELY TO CONTINUE TO SHOW THIS, YOU KNOW, UNDERPINNING STRENGTH IN THE U.S. ECONOMY, AS WELL AS SIGNS OF STABILIZATION IN THE LABOR MARKET. THE FED, YOU KNOW, ALL EYES WILL BE ON WHAT THEY ARE GOING TO DO NEXT WEEK, LIKELY TO HAVE A POLICY PAUSE, SO PERHAPS WE ARE IN A WAIT AND SEE MODE UNTIL WE GET GREATER CLARITY FROM THE MIDTERMS, AND CERTAINLY WHAT THE INFLATION PRINTS COULD BE IN THE NEXT COUPLE OF MONTHS. VONNIE: ARE WE GETTING TO A POINT WHERE WE COULD SEE REAL DIFFERENTIATION IN DEBT MARKETS? SO SOVEREIGN DEBT IS TAKING A WHOLE DIFFERENT PATH POTENTIALLY FOR THE NEXT SEVERAL WEEKS THAN CREDIT IS? WE HAVE SEEN JUNK SPREADS BLOW OUT AND EVEN REGULAR INVESTMENT CREDIT IS GETTING JUST A LITTLE MORE INTENSE. LAURA: I THINK WHAT WE HAVE SEEN FROM INVESTORS SO FAR THIS YEAR IS LOOKING AT THE ATTRACTIVE ALL IN YIELDS OFFERED BY CORPORATE CREDIT AND MANY OF THESE COMPANIES LOOKING AT THE UPPING QUALITY SPECTRUM HAVE HEALTHY BALANCE SHEETS, THEY ARE MORE GLOBAL EXPOSED, SO THAT HAS UNDERPINNED DEMAND FOR CREDIT SECTORS, IN PARTICULAR EVEN IN THIS BACKDROP WHERE WE HAVE SEEN HYPERSCALER ISSUANCE YEAR TO DATE BEING QUITE ROBUST. WE HAVE NOT SEEN SIGNS OF CRACKS IN THE DEMAND PICTURE JUST YET, WHEREAS WHEN WE LOOK AT WHAT IS HAPPENING IN THE GOVERNMENT BOND SPACE, NOT ONLY THE INFLATION CONCERNS WITH GEOPOLITICS BUT REALLY THESE LONG-TERM STRUCTURAL FORCES HAVE COME BACK, MOST PREDOMINANTLY FISCAL CHARGES, OF COURSE NOT JUST IN THE U.S. TREASURY MARKET BUT CERTAINLY WHAT WE ARE SEEING IN THE EUROPEAN GOVERNMENT BOND MARKET AND THAT HAS MADE INVESTORS MORE CAUTIOUS IN TERMS OF THE OUTLOOK. VONNIE: OAT BOND SPREAD AROUND 175 BASIS POINTS AGAIN TODAY. ANTHROPIC WILL BE THE ASSET TEST FOR AI SENTIMENT. DO YOU AGREE? ARE WE WAITING FOR THE ANTHROPIC IPO'D TO GET OUT TO GET TO SEE EXACTLY HOW INVESTORS DIGEST IT? LAURA: I THINK IT IS CERTAINLY TO BE AN EVENT RISK. I THINK WHEN WE START TO SEE THESE BIG IPOS COMING TO THIS OVERSATURATED TECH MARKET ALREADY, THAT IS GOING TO BE A REALLY STRONG PROXY FOR INVESTOR SENTIMENT. I THINK TO OUR MIND, WE ARE ENTERING THE NEXT PHASE OF THE AI WAVE. WE HAVE SEEN MORE RECENTLY INVESTOR CONCERNS AROUND THE SUSTAINABILITY OF CAPEX, WHETHER WE ARE GOING TO SEE MEANINGFUL RETURNS ON ALL OF THIS INVESTMENT. AND WE ARE EVEN STARTING TO SEE SOME SECOND-ORDER, SOME THIRD ORDER BENEFICIARIES OF AI, EVEN SO-CALLED PICKS AND SHOVELS, BECOMING MORE CROWDED TRADES. I THINK AT THIS JUNCTURE, IT IS REALLY GOING TO BE ABOUT DISCERNING AMONGST THE DISPERSION WITHIN THIS TECH AND BROADER AI SPACE, LOOKING FOR THOSE THAT HAVE BALANCE SHEET STRENGTH, CAPITAL DISCIPLINE, CASH FLOW GENERATION, AND DURABLE BUSINESS MODELS. VONNIE: HOW CONCERNED ARE YOU AT NUVEEN ABOUT THIS MOST RECENT RISE IN OIL PRICES? THE MIDTERMS ARE NOT FOR A WEEK AND A HALF, SO THIS IS LIKELY TO PERSIST AT LEAST UNTIL THEN IF PRESIDENT TRUMP SAYS HE'S GOING TO DO SOMETHING AFTER THE MIDTERMS. LAURA: WHAT HAS BEEN INTERESTING ABOUT OIL MARKETS IS, YES, WE ARE SEEING THIS EMBEDDED RISK PREMIUM PERSIST AND THAT'S BEEN THE CASE EVEN WHEN WE DID SEE AN EASE AND GEOPOLITICAL TENSIONS. I THINK WE ARE LARGELY IN A RANGE -BOUND TRADE FROM HERE UNTIL WE SEE SIGNS THAT THE STALEMATE ON THE GEOPOLITICAL FRONT IS GOING TO COME TO AN END AND DOES NOT LOOK LIKELY IN THE NEXT QUARTER. FROM A MARKETS PERSPECTIVE, IT IS WHAT THAT MEANS FOR THE INFLATION PROFILE. WE HAD MUCH HIGHER THAN EXPECTED U.S. PPI AND CPI, SUGGESTING CORE PCE COULD COME IN AT 3% YEAR ON YEAR. IF WE START TO SEE OIL PRICES PERSIST AT THESE LEVELS, THAT COULD START TO FEED INTO CORE INFLATION IN PARTICULAR, AND I THINK THAT IS THE KEY RISK POINT, BECAUSE THAT COULD PROMPT THE FED TO HAVE TO TIGHTEN MORE THAN MARKETS ARE CURRENTLY PRICING. THAT IS NOT OUR BASE CASE BUT IT DEPENDS ON THE DURATION OF THESE ENERGY PRICES RATHER THAN NECESSARILY INCREMENTAL MOVES THAT WE ARE SEEING IN OIL. VONNIE: WE ARE SEEING CALPERS MAKE WHOLESALE CHANGES, GETTING OUT OF MAG 7 CONCENTRATION AND MAKING THAT HUNDREDS OF COMPANIES INSTEAD OF JUST A FEW. ARE YOU DOING ANYTHING AT NUVEEN THAT YOU COULD CONSIDER A WHOLESALE CHANGE OR SOMETHING WITHIN YOUR CREDIT SPHERE WHICH WOULD BE CONSIDERED A BIG CHANGE? LAURA: I DON'T NECESSARILY THINK WE ARE MAKING MEANINGFUL CHANGES IN THIS BACKDROP OF HEIGHTENED UNCERTAINTY AND VOLATILITY. WE DO REMAIN CONSTRUCTIVE OVERALL ON THE AI THEME, BUT I THINK AGAIN, IT IS BEING MUCH MORE SELECTIVE AROUND WHO COULD BE THE WINNERS AND LOSERS FROM THAT SPACE. THE PRICE ACTION WE HAVE SEEN MORE RECENTLY IS THIS BROADENING AWAY FROM SOME OF THE TECH SPACE SO KIND OF CAPTURING THAT OVERALL ROTATION, SO HEALTH CARE, UTILITIES, STAPLES REALLY WAS QUITE PRONOUNCED YESTERDAY IN TERMS OF THE RALLY. WE THINK MORE BROADLY, WE ARE GOING TO SEE THIS BROADENING OF THE RALLY, NOT JUST KIND OF IN THE U.S. BUT CERTAINLY GLOBAL DIVERSIFICATION IS TOP OF MIND FOR CLIENTS AND I THINK THAT WILL BE A DOMINANT THEME GOING FORWARD AS WE SHIFT AWAY FROM JUST THAT KIND OF PURE AI DRIVEN MINDSET. VONNIE: THAT IS LAURA COOPER, HEAD OF MICROCREDIT AT NUVEEN. AFTER A FIVE-YEAR WAIT, CITIGROUP HAS RECEIVED APPROVAL TO LAUNCH HOLY ON SECURITY BUSINESS IN CHINA. THAT APPROVAL COMES WEEKS AFTER PRESIDENT XI AND PRESIDENT TRUMP MET IN WASHINGTON. CITIGROUP SECURITIES WILL BE HEADQUARTERED IN SHANGHAI AND PROVIDE ONSHORE CAPITAL MARKET SERVICES THAT WILL INCLUDE UNDERWRITING AND EQUITIES BROKERAGE. THE TRUMP ADMINISTRATION IS SICK AND TO RESTRICT U.S. INVESTMENT IN CHINESE BIOTECH COMPANIES. THE TREASURY HAS PROPOSED ADDING BIOTECH TO A LIST OF SENSE TECHNOLOGIES SUBJECT TO INVESTMENT LIMITS. THE MOVE COMES AT A TIME WHEN U.S. COMPANIES ARE INCREASINGLY TURNING TO CHINA FOR NEW MEDICINES. JETBLUE SHARES AND BONDS SANK TWO RECORDS THURSDAY, SIGNALING GROWING INVESTOR CONCERN OVER THE AIRLINE'S FINANCIAL OUTLOOK. JETBLUE IS PARTICULARLY EXPOSED TO PRESSURE IN THE AVIATION INDUSTRY DUE TO ITS HEAVY DEBT BURDEN AND RELIANCE ON PRICE-SENSITIVE LEISURE TRAVELERS. COMING UP, PRESIDENT TRUMP CONTINUES AGGRESSIVE MIDTERM CAMPAIGN EFFORTS. WE WILL DISCUSS. THIS IS BLOOMBERG. ♪ THIS IS "BLOOMBERG BRIEF." PRESIDENT TRUMP RAMPING UP HIS MIDTERM CAMPAIGN PUSH, TRY GOING -- TRAVELING TO IOWA TO BOOST CANDIDATE ASHLEY HINSON. THE USUALLY RELIABLE REPUBLICAN STATE NOW SEEING IT IS COMPETITIVE FOR DEMOCRATS. GIVE US THE TEMPERATURE. WHAT DOES IT LOOK LIKE 10 OR 11 DAYS OUT FROM THE MIDTERMS? JONATHAN: THE TEMPERATURE, IT IS KIND OF A CONTEST WHERE THE VIBES ARE VERY MUCH WITH THE DEMOCRATS AND POLLS ARE VERY MUCH WITH THE DEMOCRATS. PRESIDENT TRUMP IS EXTREMELY UNPOPULAR. MANY DEMOCRATIC CANDIDATES ARE RUNNING STRONG INDIVIDUAL RACES IN PLACES THAT TEND TO BE CONSERVATIVE. THE NUMBERS ARE WITH REPUBLICANS. THEY HAVE MORE MONEY TO SPEND AND A LOT OF THE RACES ARE TAKING PLACE IN STATES THAT ARE MUCH MORE CONSERVATIVE THAN LIBERAL. IF PRESIDENT TRUMP CAN BRING HIS OWN VOTERS HOME THEY CAN POSSIBLY LIMIT THEIR LOSSES, AT LEAST IN THE SENATE. THE HOUSE MOST PEOPLE PRETTY MUCH BELIEVE IS A DONE DEAL, IT WILL FLIP DEMOCRATIC. EVERYBODY BELIEVES IT IS A QUESTION OF HOW MANY SEATS DEMOCRATS WIN. THE SENATE IS STILL ON A KNIFE'S EDGE. COULD GO EITHER WAY. FRANCINE: -- VONNIE: THIS VIVEK RAMASWAMY AT, DOES IT JUST PASS ON BUYER DOES THAT IMPACT THE GUBERNATORIAL RACE? JONATHAN: I THINK THAT IF IT IMPACTS THE RACE MOST PEOPLE THINK IT WILL BE A BACKLASH AGAINST VIVEK RAMASWAMY BECAUSE IT IS SUCH A DRAMATIC STEP, EVEN IN A TIME WHERE WE HAVE SEEN WILD POLITICAL ADS, INCREDIBLE ATTACKS OVER THE PAST DECADE THAT EVEN A LOT OF REPUBLICANS THINK THIS WAS A BAD MOVE. IT IS PROBABLY A SIGN THAT THINGS ARE NOT GOING WELL FOR HIM, THE FACT HE CHOSE TO RUN THIS AT. YOU DO NOT DO THIS KIND OF THINGS IF YOU THINK YOU ARE WINNING. SOME REPUBLICANS ARE WORRIED IT CANNOT ONLY BE A BACKLASH AGAINST HIM BUT HURT THEIR SENATE CANDIDATE IN THAT STATE IF IT TURNS VOTERS OFF THAT MUCH IN WHAT COULD BE A CLOSE RACE ON THE SAME BALLOT IN OHIO. VONNIE: TRUMP DEFENDING THE AD AND CALLING IT PAYDIRT. LET'S TALK ABOUT MICHIGAN. WE HAVE SEVERAL CHARACTERS GOING TO MICHIGAN. FORMER PRESIDENT OBAMA, BERNIE SANDERS, AND TRUMP. JONATHAN: IT SHOWS YOU HOW IMPORTANT THIS STATE IS. DEMOCRATS ARE TRYING TO HOLD THE SENATE SEAT AND IT IS THE ONE PLACE WHERE REPUBLICANS FEEL LIKE MAYBE THEY CAN GAIN A SEAT INSTEAD OF PLAYING DEFENSE. IF THEY WIN THERE IT COULD BE A HUGE PROBLEM FOR DEMOCRATS. DEMOCRATS HAVE A PRETTY TOUGH MAP. THEY HAVE TO ADD FOUR SENATE SEATS. IF THEY LOSE THERE THEY HAVE TO ADD FIVE. THEY HAVE TO RUN THE TABLE EVERYWHERE ELSE. YOU WOULD THINK MICHIGAN WOULD BE A STATE DEMOCRATS WOULD BE ABLE TO HOLD. THEY'VE ELECTED DEMOCRATIC SENATORS FOR THE PAST 30 YEARS. THE CANDIDATE THERE, ABDUL EL-SAYED HAS BEEN SOMEWHAT CONTROVERSIAL. HE IS LIBERAL FOR A STATE THAT IS A PRETTY MODERATE STATE. YOU ARE SEEING HOW MUCH IS AT STAKE BY ALL OF THESE THREE BIG NAMES GOING THERE ON ONE OF THE LAST WEEKENDS OF CAMPAIGNING. VONNIE: ELON MUSK AS WELL. IT IS NOT JUST THE PRESIDENT'S ENDORSEMENTS. ELON MUSK HAS DONATED HALF $1 BILLION TO TRY TO ELECTED GOP CANDIDATES. ARE WE SEEING ANY SIGNS THAT HIS SPENDING IS SUCCESSFUL? JONATHAN: IT IS AN ASTONISHING AMOUNT OF MONEY AND THE PLACE WE SEE AT THE MOST IS IN TEXAS WHERE THE REPUBLICAN SENATE CANDIDATE IS NOT A GREAT FUNDRAISER. THE DEMOCRATIC CANDIDATE JAMES TALARICO IS BREAKING FUNDRAISING RECORDS. HE IS SEEN PERSONALLY AS BEING MORE POPULAR, MUCH MORE POPULAR THAN PAXTON. PAXTON HAS A HISTORY OF SCANDALS. YET THE RACE REMAINS TIGHT. ELON MUSK'S SPENDING IS HELPING CAN PAXTON STAY COMPETITIVE. IT IS NOT CLEAR IF IT WILL PUT HIM OVER THE TOP BUT THAT IS THE BIGGEST EXAMPLE OF A PLACE WHERE THINGS MIGHT LOOK MORE DARK FOR REPUBLICANS IF NOT FOR ELON MUSK SPENDING. IT IS WORTH NOTING THAT MUSK IS SOMEONE WHO HAS BUSINESSES HEAVILY REGULATED BY THE GOVERNMENT. COULD BE INVESTIGATED FOR HIS ROLE IN DOGE EARLY IN THE TRUMP ADMINISTRATION. HE HAS A LOT PERSONALLY IN STAKE AND WHO CONTROLS CONGRESS. VONNIE: THANK YOU FOR THAT CONTEXT AS WE HEAD INTO WHAT COULD BE A REALLY IMPORTANT WEEKEND. SOME STOCKS WE ARE KEEPING AN EYE ON. WIRELESS CARRIERS SLIDING IN THE PREMARKET. THIS IS BLOOMBERG LEARNS SPACEX IS LOOKING TO SECURE OR LEASE AT LEAST 18,000 CELL SITES ACROSS THE UNITED STATES. THIS IS SOMETHING ELON MUSK HAS SPOKEN ABOUT. WE WOULD LIKE A FOURTH WIRELESS CARRIER. BUT IT WOULD CHANGE THE NATURE OF SPACEX ENTIRELY, WANTED? -- WOULDN'T IT? >> THIS IS SOMETHING THAT HAS BEEN SPECULATED AND THERE'S A PUSH TO CREATE THE FOURTH BIGGEST NATIONWIDE CARRIER. IF WE LOOK AT SPACEX AS A BUSINESS, CONNECTIVITY ACCOUNTED FOR $5.2 BILLION IN REVENUE, WHICH IS ABOUT 36% OF SALES. IT IS A SIZABLE PORTION OF THE BUSINESS. IT IS A VERY PROFITABLE PART OF THE BUSINESS. CLEARLY THERE IS AN ATTEMPT TO MOVE INTO THE SPACE. THEY HAVE THE CASH IN THE ECONOMICS TO DO THAT BECAUSE THE CURRENT SEGMENT IS GROWING. IT IS PROFITABLE AND SIZABLE. VONNIE: MOFFAT NATHANSON POINTING OUT THEY WOULD HAVE TO GO TO WHERE THE COVERAGE IS NEEDED AND NOT WHERE THERE ARE ALREADY SUBSCRIBERS. THAT WOULD BE ONE THING YOU HAVE TO WATCH IN THAT SCENARIO. CAN I ASK YOU ABOUT OPENAI? WE ARE SEEING A LITTLE BIT OF DOWN, DOWN FROM $1.4 TRILLION. SHOULD WE BE TAKING NOTE? >> THIS IS UNDERSTANDABLE IN THE CONTEXT OF THE AI TRAIT MORE BROADLY. EARLIER THIS YEAR OPENAI AND ANTHROPIC WERE TOUTED TO FETCH VALUATIONS MUCH BIGGER. WE ARE SEEING A BIG RECALIBRATION IN TERMS OF INVESTOR EXPECTATIONS AROUND THE AI TRAIT. IT HAS MOVED FROM CAPEX TO ARE YOU GROWING AT THE RATE THAT DEMANDS THESE KINDS OF VALUATION MULTIPLES AND IF YOU ARE NOT YOU WILL GET MARKED DOWN WHICH I WHY I THINK IT IS HAPPENING WITH OPENAI. IT IS UNSURPRISING THE VALUATION IS LESS THAN WHAT WAS TOUTED EARLIER THIS YEAR. VONNIE: WE ALSO HAVE WESTERN DIGITAL REPORTING, THE FIRST OF THE MEMORY MAKERS, AND IT IS LOWER AT LESS THAN 1%. THE RESULTS WERE NOT TAKEN SO WELL. WHAT DID IT TELL US ABOUT MEMORY MAKERS BEING ABLE TO PRICE AND ABOUT DEMAND IN GENERAL? >> IT WAS A SOLID QUARTER IN GENERAL. THEY DID UPGRADE GUIDANCE. TWO THING STOOD OUT TO ME IN TERMS OF THE NEGATIVES. THE FIRST WAS THE COMMENTARY AROUND HEIGHTENED COMPETITION. I THINK THAT IS DEFINITELY WEIGHING ON THE STOCK. THE SECOND IS THE INCREASED SPAN OF 4% TO 6% OF SALES AND FOR A STOCK TRADING AT HIGH DOUBLE-DIGIT VALUATION MULTIPLES THOSE THINGS ARE LEADING TO WEAKNESS. THERE WAS COMPETITION AND CAPEX DEFINITELY WEIGHING ON THE STOCK. VONNIE: WHAT CAN WE EXPECT FROM THE REST OF THE MEMORY MAKERS? SHOULD WE ANTICIPATE WE MIGHT SEE BETTER REACTION TO SOME OF THESE BEATS WE ARE SEEING? >> FUNDAMENTALLY IT WILL BE STRONG FROM SOME OF THE OTHER MEMORY MAKERS. SUPPLY IN THE SPACE REMAINS TIGHT, PARTICULARLY FOR SOME OF THE CHIPS. THEY ARE GOING TO BEAT AS THEY ALWAYS DO AT THE BROADER CONTEXT AND THE WIDER MARKET BACKDROP WE HAVE SEEN ANGST CREEP IN AROUND AI TECH AND THAT WILL FEED INTO MEMORY AS WELL. IT IS A VERY VOLATILE ENVIRONMENT. OIL IS A LOT HIGHER. THERE IS A LOT TO DIGEST. NET-NET IT WILL BE STRONG QUARTERS OF THE MARKET REACTION WILL BE DETERMINED BY OTHER FACTORS IN THE MARKET AT THE MOMENT. VONNIE: THANK YOU SO MUCH. TAKING US THROUGH THIS WEEK IN EARNINGS. COMING UP, WE WILL GET YOU SET UP FOR THE TRADING DAY. THIS IS BLOOMBERG. ♪ VONNIE: A LOOK AT WHAT IS AHEAD FOR YOUR FRIDAY SESSION. AMERICAN EXPRESS AND AS REPORTING FOR THE BELL -- AMERICAN EXPRESS AND SLB REPORTING BEFORE THE BELL. THEN PMI AT 9:45 EASTERN TIME. BRAZIL'S PRESIDENTIAL RUNOFF TAKES PLACE SUNDAY. SOME EARNINGS MOVERS BEFORE THE BELL. DECKERS IS DOWN SUBSTANTIALLY, CUTTING FOR THE YEAR EVEN THOUGH SOME OF THE METRICS BEAT. RIG CENTRAL UP 15%. THE SOFTWARE MAKER LIFTING ITS EARNING OUTLOOK. NOT THE CASE FOR BLUE ENERGY, DOWN BUT SMALL. THIS IS BEEN A VOLATILE NAME. BLUE ENERGY BOOSTING ITS REVENUE FORECAST AND IT DID BEAT ESTIMATES. LET'S LOOK AT THE MACRO PICTURE INTO THE FRIDAY SESSION. IT HAS BEEN A TOUGH WEEK. APPLE HAS LIMITED SUPPLY OF DEALS ON SALE ON STORES. I SAW PEOPLE LINING UP ON FIFTH AVENUE. WE WILL SEE WHAT HAPPENS WITH APPLE. NASDAQ FUTURES HAVE TURNED NEGATIVE. THEY STARTED THE SESSION POSITIVE. THAT SENTIMENT IS CREEPING OUT OF THE MARKET AND YOU CAN SEE THE 10 YEAR YIELD DROPPED BELOW 5% AND IT IS HOLDING BELOW 5% EVEN THOUGH BACK UP TWO BASIS POINTS. WE ARE HEADED QUICKLY TOWARDS ONE -- TOWARDS $115 A BARREL. THAT IS IT FOR "BLOOMBERG BRIEF." "SURVEILLANCE" IS NEXT. THIS IS BLOOMBERG. ♪