>> good morning, this is

daybreak europe. i am tom mackenzie in london. the stock so i think after another jump in treasury yields. drawing power calls say rates can be kept steady as long as needed. morgan stanley's had to plan its biggest round of job cuts in china in years. we bring you a book -- a rep of the wall street bankers. we ship to europe with two heavy hitters reporting. a slowdown in sales revealed that now dropping across the trademark -- the chip equipment supplier, bookings for the first quarter a miss for asml, coming in at 3.6 one billion euros. the estimates had been for 4.63

billion euros. a sizable mist in terms of first quarter bookings. we know that they must've been scrutinizing that data point. the focus on demand out of china. we will look for details on that. the second quarter gross margin is that it will get 50 to 51% in terms of the gross margin for the second quarter. they see sales between 5.7 billion euros to 6.2 billion euros. that is looking ahead to the second quarter. sales and the orders missing the estimates. net sales $5.2 billion. the top line, the redhead across the journal. they provide the essential equipment to making the high-end semiconductor used in every thing from ev's to missile systems.

3.61 billion euros versus 4.6 billion euros. we will be checking at the open for you and the read across to the semiconductor space. stocks taking a bit of a breather given the selloff we are seeing. three straight days of selling pressures. today the future is pointing slightly higher. the yield jumped again. we'll get into the detail of that in the next minute or so. the futures when it comes to european futures are looking a little brighter. a modest a lot in european stocks. the s&p futures stateside looking back about 5100 today. a little under 20%. let's split the board cross asset then. the cell of across treasuries.

painting a picture of higher for longer. brent $89 a barrel. investors in the oil space listen to that and iron ore prices actually rally in the sessions today for the tournament in the picture yesterday. up to .6%. let's cross over to asia with the mainland markets in china having a relatively positive session. >> we are seeing asian stocks catching a bit of a breather. the currency is where the focus is really at.

no thanks to the u.s. inflation print and despite the hawkish comments from powell, the lack of progress on inflation ideas here behind the rebound seems to be -- they are not seeing something materially different. we are seeing the korean won, the japanese yen of recovering some lost ground. they are hovering near the 1400 level. they had yesterday. on the chinese currency, 730 seems to be next level to watch. that seems to suggest that a new trading range is in play. let's take a closer look at what we are seeing on the japanese yen as well as the korean won. they are said to have met the japanese counterparts and discussed the serious concern about the weakness in local

currencies and the volatility. the jawboning also seems to be helping somewhat. let's take another look at what we are seeing in the stocks. as you saw earlier, the gauge of stocks in the region is pretty flat. this is stemming the losses that we have seen in the past week or so. that is happy to offset the declines we are seeing in japan. part of where we are seeing china stocks run higher is the top securities regulator coming into ease some of the concerns about potential delisting of companies with weak financial -- the small cat gauge surgeon. >> look back and thank you very much indeed. to jay powell know whether thatcher has signaled that they will cut interest rates in the wake of a series of higher than expected inflation readings.

>> greater confidence that this is moving sustainably toward 2%. they have not given us greater confidence and they indicate it is likely to take longer than inspected to achieve that confidence. given the strength of the labor market and progress under inflation so far, it is leading the data and i will guide us. the performance has been quiet strong. come what may, we remain strong -- strongly committed to this. >> let's bring in the executive editor. getting more confident. talk to us about the market reaction we had been hearing from jay powell. >> yes. you might wonder whether the

market reaction had been a little more violent in the u.s. session. we did see higher bond yields. nothing too profound considering this is the fed chair shifting slightly his view. i think because so many of the fed policymakers have already put that same idea out there, it is not really a surprise to see that eventually. even looking at what the market is factoring in. as well as the relative calm in the u.s. markets, it has moved over the past 10 days, we have those much higher tertiary yields. it is the best of the world that is bearing the brunt of this in some ways. as some girls are talking about with the fx market in asia under

pressure in recent days from the strength of the dollar. it is our currency your problem once again. >> the hammer blow of the strong u.s. dollar being felt across the u.s. market. how is the fx base holding up? >> holding up better with white a lot out there. i did think it was significant, this comment from south korea that they were talking from japan and voicing their concerns together. i think we will want to pay attention to what is happening with the g20 meeting in washington and whether they force themselves onto the data given the volatility and the moves we have seen of late, just in the pressure that the asian central banks are under. the market is starting to think about some of the central banks have to hike interest rates in order to contain their currencies and give them that extra support? where are the weak spots in the market? we are starting to see some probing and pressures. but a lot of those key levels read across there.

the pressure is starting to mount even in today, maybe not as much as what we had seen in recent sessions. was maybe just a temporary reprieve. there with the bloomberg executive editor for asian markets. they have got about 50 investment banking jobs in the aipac region. starting this week. at least 80% of the reductions are likely to be in hong kong and mainland china. what do we know about the job cuts about china's ongoing struggles? >> at the moment, what we do know is we expect i 50 world will go in the investment banking across the investment banking department. this will be a major focus on hong kong and china. 50% of the cost coming from

those two locations and clearly this is a sign that morgan stanley still has more adjustments to be made in the asia-pacific region as it reallocate some of its resources given what is happening in china. they are very well flagged and well understood in the story of china and the decrease in the activity we have seen there. the sluggish nature of the ipo market there. but also the debt market there that has been struggling as well. this is clearly another sign of them needing to bring back some of the resources there to cut costs in certain areas there but we've seen it at some other peers in the region. a lot of the u.s. investment banks continue to cut back jobs in certain areas.

the businesses continue to be hammered from a number of different directions but we have seen in these latest numbers over the last few days that some of these investment banks are seeing increased activity levels both in equities and in fixed income. these are the bank of america numbers recently, just how much of an improvement there had been in that equity flow and equity markets in the asia-pacific. certainly japan has been a standout market. global investors had been shunned for many years. but also on the fixed income side as we have seen and with a lot of readjustment in positions and especially in treasuries but really across the developed world and mature bond markets. most government bond markets have repressed the scenario that looks white different for interest rates than it did a few months ago. that coincided with the increased activity and increased

volatility that is plaintiff's revenue lines and some of these banks. that is the good story. the good news story coming out of some of these investment banks. of course you still have this issue in the lending income continues to be a pretty big area of pressure there. the net interest income is continue to be a tricky area for these banks. quick thank you very much indeed. we will continue to monitor whether the pickup in training will be sustainable for some of these. at least partial retrenchment. checking in on what else you need to know today. this is the day had picture. it is inflation data that comes out. you can see a moderation for the march print. really consequential given the things we will be hearing from

andrew bailey. suggesting the inflation dynamics are looking more positive here. 10:00 a.m., yucatan. the big -- a buildout in the euro zone. and 7:00 p.m. yucatan it is the fed beige book. details of the 12 districts the fed covers and real color on the u.s. economy. 7:00 p.m. yucatan. the u.s. says it will impose new sanctions on iran in the coming days. we have the details next. plus jp morgan is all in on a i. don't miss the best of their interview with jamie dimon. that conversation later in the show. this is bloomberg. ♪

>> >> welcome back to bloomberg daybreak: europe. the u.s. as it will impose new sanctions on iran. they are pushing into a wider conflict and an unprecedented attack there. patrick has been following all this progress. the key question is what significance the sanctions really are.

is this merely symbolic for the u.s.? >> that is right. it was specifically intended because there was the nation -- the nature of this attack that you mentioned. the use planning similar moves. as you say, iran has a long track record of dealing with sanctions. it is a heavily sanctioned place. it has a persistence economy is done finding ways around them. i think the symbolism is much more important in this case. it is more of a diplomatic signal to israel. it is saying we are acting

immediately in the days after that attack. therefore you don't need to go so hard in your planned military response to that attack. take this as a message of support and feel reassured that we are here for security. >> on that point, what more do we know about israel's plans? >> outlining some of the potential scenarios. it will be something like a cyberattack but in the region. then you have a missile strike. perhaps a military facility with that missile or drone program over the weekend. then finally at the very top, some kind of targeting.

we don't know which way israel is leading. we do not the work plaintiff admitted since the attack was postponed. that perhaps signals that there is this space for deliberation, the signaling that they are not rushing into a decision in terms of security prospects. i think that does at least signal they are very much open to moderating that response. we can't underestimate the fact that they do need to feel -- feel the need to respond and show some strength domestically as well. request that was patrick sykes joining us in terms of the u.s. sanctions for iran. and the potential consequence is. thank you very much indeed. the oil markets and the space.

currently brent at 89 and 45 as investors do wait for that clarity. 6/10 of a percent so far, back down below $90. down 7/10 of it -- 7/10 of a percent in the session. goals is at a storming year-to-date move. we continue to watch those assets. now it is volvo trucks. that is the adjusted operating margin. for the first quarter of 13.8%, that is a be from the estimates coming through. it is a bit on the first quarter adjusted operating margin in terms of net sales. also be from volvo.

versus 149 billion. there is a beat in terms of the operating margin. watch that stock at the yucatan. they are soft and luxury demand from china. we will have the details next. this is bloomberg. ♪

>> welcome back to bloomberg daybreak: europe. they reported their weakest first-quarter sales growth since 2016 excluding the pandemic in 2020. the world's biggest luxury group is being hit by weak demand for

cognac and champagne. the spring and carry -- caroline for some of this. are they feeling the squeeze? we have seen this from other luxury groups when it comes to that demand out of china. >> there has been a lot of anxiety after this profit warning. especially after the bed explosion in china and the u.s. which is not totally recovered for the luxury sector. if you look at the like -- leather division which is most important because includes their label, louis vuitton, does organic sales in the first quarter adjusted percent. that is the weakest quarter since 2016 if we exclude the pandemic.

the first quarter of last year where sales were 18%. chinese demand still not totally recovered. even though the chinese demand for this specific division is actually 10% if you consider chinese travelers up -- chinese travelers abroad. they are down 6% in the quarter. meanwhile, the u.s. is not totally recovering. we are not seeing this recovery story quiet yet for lvmh. it is impacting the wine and spirits division. these are much more cautious about cognac and. we have organic sales down.

we are also suffering down 2%. request what is the broader be to cross then?

we are lined with very low by expectations. the acute demand on environment. we will see how this pose for the second half of the. >> thank you very much. with uninspected bookings for the first quarter. the first quarter. we have

of spirit to someone. and you want people to be saved and to have a better life, then you don't stop. we have been able to reach over 100 million people impacted and affected, and at risk of hiv. the rocket fund takes all of the work that we're doing, all over the world, and looks at the most effective ways, to get resources to them, to get services to them. the idea that we have saved five million people's lives, it's overwhelming. it's everything.

chris good morning, this is daybreak europe. i am tom mackenzie in london. the stock selloff takes a breather. jerome powell reversing course. andrew bailey against the central bank may be able to cut rates before the fed saying the two countries are diversion. let's check in on these markets. we will be watching the tech sector here with those disappointing numbers. european futures responding in positive territory. here in the u.k., the 4100 futures higher by 3/10 of a percent. s&p futures stateside by .2%.

we talk about the run-up in yields and jay powell's market change of tone. -- marked change in tone. we saw a jump yesterday. we will see how long that holds four. $89 a barrel on brent. currently down .5%. prices jumping in the session today. of 3% currently in iron ore. let's return. the new orders falling short.

the details, let's go to david watkins. at the chip industry grapples with delivery impact of inflation.

>> one of his challenges is to mandalay. maybe that she would not be so spectacular comes to the numbers. because this is the only company that makes these machines. they bill the most advanced semiconductor chips for ai processes. with china, the restrictions are fully kicked in.

he did say they are based on the early restrictions. >> we continue to look at 2025 as potentially overly strong year as a year that they fired. a decent demand for those very high-end pieces of kit. does that look like it will be sustained? >> this is the thing. looking through the numbers, the previous ones were something with 3.5 6 billion. the actually felt like considerably.

there are a number of factors. intelligence will be driving demand. they are doing with lumpy waters at the moment. this is fluctuating in 2024. >> out of amsterdam on those. staying in the tech space, the ceo has been struggling with tumbling shares and wall of debt. the french company will be saved.

an exclusive interview in paris. we are working with our creditors. a solution to our high level of debt. the dialogue is very positive. we are operating in a way that helps discussions. everybody is aligned. we recently had secured some liquid from those same bondholders and the banks. >> what else could be part of the proposal apart from this group of bondholders? will we see some asset disposal announced before the end of next week? is that a possibility? do you totally exclude this?

>> what we have presented is a comprehensive plan that includes all the assets. now we will see what proposals will come through. we will just look at the whole of the company together. it is likely to come from one point, one of our largest shareholders. others will come in from our bondholders seem to be interested in this. we can really forgo any potential proposal that maintained a different mix of ideas. i believe the company will succeed long-term. so we will be saved. >> we will be saved. >> all right, that was the ceo in paris.

jp morgan is all in on ai. in the premiere episode of the circuits second season, jamie dimon space with emily chang about the opportunities and risks for technology. >> be prepared for any business, think about things that could go terribly wrong. it could be technology, government regulations, it could be the weather if you are a restaurant. if you lose this week's business , you just think all that through. >> bill gates was said banking is necessary, banks are not. to what extent could ai or fintech replace traditional banks? >> our member him saying thanks are dinosaurs. he was dead wrong. but he is not wrong, technology changes everything. if anyone is complacent or

absent, that is a mistake. what is banking? someone's going to have to hold money, so was going to have to raise the money, so it is going after research around money. those services will all be around. hopefully we are doing it. i was that it was very possible that some tech figure present a piece of that. we have fintech but also big tech. they will invent payment systems and went able banks, somewhat what apple did. i'm not against that. i would be a unfair use of their position. >> apple is going deeper into financial services. do you worry about the back of apple? if they have a tough competitor. they hold money. they move money. they are full competitor. i am very astute competing with

lots of people. >> existential threat? questionable think is existential threat but if we were complacent about it, yes. because was jp morgan. you can watch the circuit with emily chang tonight on bloomberg television and you can stream it two hours later on bloomberg originals. after some of the other stories making the news, hsbc are said to have started a new round of job cuts on his asian investment bank. the lender laid off about a dozen backers on tuesday. cross asia has little bit. especially in hong kong and china. they made rounds of job cuts in asia over the past 18 months. they are halting all chickens for passengers for the day. bad weather injured by. it disrupts travel in one of the biggest aviation hubs.

it stems partly from cloud ceiling operations that are meant to encourage rainfall in the uae. the u.k. chancellor tells bloomberg the start of rate cuts could lift the mood in the u.k.. it is at an autumn election. we bring more with our interview. that is next. this is bloomberg. ♪

>> welcome back to bloomberg daybreak: europe. jeremy hansen is the prospect of interesting cuts will lift the mood of voters and say the government will call a general election until the autumn.

>> the decision for the independent bank of england -- that decision is taken independently. they have to look at a lot of things. we still have a very strong wage growth data going on for nine months in a row in real terms. but i think the big message from today is the imf are saying inflation will be 1.2% lower. there are people who are forecasting inflation will be lower in the u.k. or possibly even the eurozone. that situation we were in 18 months ago with inflation at 11.1%, that is well and truly behind us. if you are looking forward in terms of long-term prospects, the imf are saying the u.k. will grow faster than france, germany or italy over the next six years. >> you are not concerned about what potentially could happen to parts of the u.k. economy?

given what you are saying was a downward trajectory? >> in the short-term, we look to the bank of england to get that fine judgment right. what finance ministers like me and you is much more -- much more about the longer-term economy and we now the imf today say there was a whole section about the impact of ai on the u.k. economy. they recognize that london is now the roads second largest epicenter after san francisco. that is the big growth. >> your point is taken, chancellor. on the fiscal side, you have suggested that an election could happen potentially as soon october. should we expect another potential physical event between

now and then? >> as the people start to feel higher, real disposable incomes will be stronger in people's minds. decisions about election timing and the prime minister and where we to have an october election, it would be possible to have a physical event in september. we would decide much near the time whether that was the right thing to do. >> you already delivered a lot physically in terms of tax cuts including personal tax cuts but when you look at polls, the conservative party is running significantly behind labor by roughly 20 points. what else needs to be done on that front to convince u.k. voters to keep the conservatives empower? >> i would be very cautious about looking at those polls.

an energy shock, high inflation with the pandemic. when it comes to a general election, it is a choice about the future. there becomes a very different decision in people's minds. request that was the u.k. chancellor. let's get more from lizzy burden in terms of what we will be hearing from the u.k. chancellor. request it is nice of him to drop in while in town from the imf. he says rate cuts later this year will lift voters moves. that confirms our expectation. his working assumption that we will not have the general election until the autumn. it is more interesting in the

context of what we heard, saying the u.k. could cut interest rates before the u.s.. does that mean the general election could come sooner in the u.k. as well? they are expecting the u.k. inflation is going to average 2.5% this year. lower than the u.s., in line with other european countries. the flipside of that is weak growth. lower than germany. what did you say about bailey yesterday? that is the change. there was really interesting yesterday. talk to us about what to expect from inflation. >> underscoring that divergence between the u.k. and the u.s. inflation pictures. even if services stay sticky in

this data, it is looking like the u.k. is finding it easier to go to the 2% target. you did see traders pairing their bets after that patrick of uscp i prince is interesting. the inference from that is the bank of england waits for the fed to cut rates. our economists don't think that is right. they think the bank of england could cut in june and by more than the market expects. they are still concerned about inflationary pressures in the u.k.. let us look at the governor andrew berry. he seems to side with our economists in saying that the bank of england has a mind of its own. >> it is rather different between europe and the u.s.. i think there is more demand led ablation pressure that we are seeing.

we are still seeing the extension of the process out of the -- the big supply shocks. course the governor referring to that demand led inflation that is present in the u.s. compared to the u.k.. marcus is currently seeing a first rate cut from the boe in september. we get a softer cpi print this morning. couldn't bring that forward to june? request that is under 10 minutes away from that inflation data. i want to thank you very much indeed. stay tuned for our interview with the form u.k. chancellor. plenty more coming up on bloomberg. a deep dive into the client and the pricing around the fed. stay with us. this is bloomberg. ♪

quick steel ethics, hookups, leap years, these happen every four years and in the crypto will, usually a boon for prices. in a nutshell, bitcoin harvesting means fewer new focused issue. they validate blockchain transactions receiving 50% less than a way for doing so. after because launch, minors received 50 new coins per block. that would be cut just 3.12 percent. in the past we were seeing positive gas prices spike. when the token jumped. this time around, the prospect for further gains is unclear.

some analysts say there is upside of at least 80%. particularly as bitcoin already has mr. fresh records this year. that brings to mind a familiar phrase. past performance does not guarantee future results. >> as annabel was saying, the question about how much is pricing around bitcoin is key. all as we lead up to the event right here on april the 25th. 50% gains for bitcoin your to date. you see that charted out here. but the 50 day moving average is around 67,000. the last time i checked we were around 63 her safety 4000 for bitcoin. does that provide further upside or are we at these levels again? expectations of rate cuts and they having event. on the rate cut question, the

markets have been repressing all of that. a marked change of tone from the fed chair. just think about where we were. now the expectation is we will get the -- bulk of the first look at until september of this year. this is the effective funds rate for the federal reserve. we have a swaps rate around september to get around the 4% level. that is the expectation level changing. you may get as few as one to two cuts against the six at the beginning of this year where markets have repriced this year from the comments from jay powell. let's check in on these futures then. slowing again for that luxury group.

given the tick up in the iron ore prices. futures now in europe, having started off the session in the green now flat. i wonder to what extent the minors are playing into that story. up next, markets today with deep diving all around central banks and the earnings story. crucially for the u.k., the inflation data that drops in around three minutes time. this is bloomberg. ♪

guy: good morning from london, this is bloomberg markets today. kriti gupta is back from brussels, anna is back today. you have a busy morning.