Transcripts For BLOOMBERG Bloomberg Markets Americas 2024071

It is 1 00 p. M. In new york, 6 00 p. M. In london. Im kailey leinz. Welcome to Bloomberg Markets. Here are the top stories we are following. Progress for a vaccine. Clearance requesting for its vaccine in the u. S. And europe today after a new analysis showed it to be highly effective in preventing covid19. We will have the latest. Talksk mentioned, opec have ended today without a deal. The conversation will be picked up tomorrow, but we will explore what it means for the cartel. General motors will not take an initial stake in the electric Vehicle Company nicola, which announced today it will go to one of its electric vehicles, a pickup to be called the badger. Lets get a quick check on the markets. We are on the last trading day of the best month for Global Equities since november, but we look set to end the month of november on a softer note. The s p 500 right now down 0. 6 . It was the fourth consecutive monday of positive vaccine data, but the good news not having the effect it did weeks ago. The cyclical strength not taking shape today. The russell 2000 down 1. 6 . Cyclical00, it is the stocks like energy which are underperforming. The energy story has to deal with oil. Wti down 1. 4 as the opec supply extension cut remains in question. Finally, have to point out bitcoin here. I promise itll be the only time i mention it during this show. Up 14 today. My question is, how long will it last . Lets get back to the news this morning on the vaccine front. But theyre not requesting clearance for its vaccine today in the u. S. And europe after it showed it was highly effective. Joining us now is the associate director for Behavioral Research as Johns Hopkins Bloomberg School Public Health for vaccine safety. Great to have you. With moderna today, how confident are you in it . Do you think people will have confidence in taking the vaccine . Thank you so much for having me. He results that came out today are quite stunning. Trial of of a 30,000, the efficacy was around 94 , so really good results. With regards to your second question, will people be confident taking it . I think it will be crucial from a Public Health perspective to be transparent and communicate to individuals about this vaccine so we can be sure when it is available individuals will be willing to take it. Kailey voter has said when it does approve it wants to start rolling out in 24 hours. Do they have adequate capacity to do that . If so, how many people will be able to get vaccinated right away . It is a great question. The way this works with regards to distribution in the United States is that it will happen by a statebystate level. States will really determine how it gets rolled out with regards to who will be first in line to get it. It will be Health Care Workers who have been tirelessly working on the front lines, taking care of patients that have covid. I think with regards to whether it is feasible, a lot of that will depend on state capability. Kailey looking out over the longer term, i guess to rephrase the question, how long will it be before enough people have gotten the shot in their arm for us to return to at least a quasinormal . It is a great question. I think with the coronavirus, we need to figure out, what is our level of herd immunity we need to achieve to make sure there are not any susceptible hosts for the virus to infect . This will really be dependent on how many people will get it, what sort of effectiveness we are seeing at the population level, because so far we have efficacy data through a controlled experiment through a clinical trial. Now we will be curious to see how this reacts at a population level. Only time will tell. The great news about the moderna vaccine, in addition to being my efficacious, understanding is it help to reduce severity. That is going to be also crucial with regards to the number of people being hospitalized. Kailey that 100 efficacy rate for the most severe cases. Was there anything in the data we got that i am missing . Are there any questions you have that are unanswered to this point . From a vaccine science perspective, what is great about the trials as they have been very transparent. Individuals have been watching these in general because we are all waiting for a vaccine. So i think it has been fantastic that we have had such transparency and such communication about what has happened within these trials. The argument would be that we need to continue the communication for those of us who work in Public Health to ensure the public that it went through a rigorous process with regards to safety and efficacy and that it is safe for individuals to take. Kailey that obviously is a longerterm conversation. In the near term, the virus is still raging. We are fresh off of the thanksgiving holiday. Millions of people trouble for that holiday. What should we be bracing ourselves for in terms of virus cases come two weeks from now . We have seen in the past with regards to holidays, for example memorial day and labor day, there is a three week lag in what we are seeing with regards to increase in cases and hospitalizations. The key will be about three weeks from now looking at the numbers and making sure we are still continuing to social distance, still wearing mask, and still doing masks, and still doing the things we were doing before to limit exposure. Kailey how much is Rapid Testing . People got Rapid Testing before they left and when they returned. Does that work . I think it depends on the test you are getting. The problem with these tests is there can be some false positives and false negatives. The issue could be that you can test, be negative, and the next day you can come up positive but because of when you tested, because of the sensitivity of the test, it might show up negative. To me, it is not necessarily an interim solution. I think the recommendation that we would give individuals, particularly along the holiday time, is to really stay home if you can just continue to do what you are doing, staying home, not hanging out with people outside of your household, and just wait for a few months until the vaccine is being rolled out to the general public. That is a better solution an option. Kailey what is your messaging to people who may have cases of pandemic fatigue, who are just overstaying at home . I feel like that as more and more people now eight months into the pandemic. It is a great question and something we all struggle with as well. We have all been working from home for so long. I think the key here to me is to say you have been doing a great job for this long. We only have a little bit more to go. Continue to think about, how do you protect your loved ones . And how do you protect those who might be immunocompromised . So we can see those pens and family in the new year. Kailey good advice. Thank you so much. The Johns Hopkins Bloomberg School of Public Health is of course supported by michael bloomberg, founder of bloomberg lp and bloomberg philanthropy. Be sure to tune into our interview with montanas cochairmen and cofounder coming up at 5 00 p. M. Moderna andochairman cofounder coming up at five rpm coming up at 5 00 p. M. This is bloomberg. Kailey this is Bloomberg Markets. Im kailey leinz. Just a month after a disastrous march meeting that ended without a conclusion and precipitated a price war, we have yet another opec gathering that finishes without a resolution. The pages could all be picked up again tomorrow, but some ominous signs of the longterm health of the cartel. Joining us now is ellen, a senior fellow at the Atlantic Council of Global Energy center. Perfect person to talk to today. Where do you put the odds of us getting a deal come tomorrow . I do think they are closer to a deal. What we are talking about in terms of a deal is moving to extend what they are doing right now. So right now, opec is actually scheduled to increase production by 2 Million Barrels per day. That is a collective opecplus production starting january 1. Any deal they reach would be a sickly would basically cut out the 2 Million Barrels per day increase and increase with the production levels for three months is what they are discussing. They are closer than not, but there are still some pretty significant hurdles to overcome. It is somewhat concerning that opec basically left the meeting without any resolution, without any press conference. Basically, kind of pushed everything off until tomorrow. Kailey what are the Key Countries you are watching . Is it all about the uae . Ellen it is about the uae. The uae is interesting. They seem to be really asserting their independence from saudi arabia. You have the uae. You have a iraq, which has basically not complied with its production quotas at all and continues to basically have to pump under this system that the under the other countries designed to compensate that never adhered to its production cuts. And then we have saudi arabia, which according to some sources threatened to resign from its position on the monitoring committee, perhaps as a result of the fact they have not been able to get iraq to follow along. Kailey on the compliance friend, are we going to have to stay reliant on saudi arabia to cut more than everybody else just to keep the balance . What are the consequences if saudi arabia does indeed step down from the cochair position . Ellen i think there will be consequences because saudi arabia has been a force for getting a lot of the countries that had not complied to come into compliance. Nigeria is one. Uae was another. There have been other countries. Iraq had shown a strong commitment to complying, but that has not exactly borne out in practice. Though it has definitely gotten somewhat better than it was. Saudi arabia is not going to provide compensate story cuts for everybody compensatory cuts for everybody else. There is always this over arcing threat over everything about saudi arabias ability to out pump everybody else and send oil prices barreling downward basically as punishment or as a threat. Kailey so what does this mean for the future of the alliance, that it is this hard for them to reach a deal . Ellen that is interesting because no one is really talking about russia this time around. Russia is basically on board with extending cuts. The large oil committees are groveling a bit, but russia has the tax structure for oil companies. If the increase production from certain deals, they will end up paying taxes. It will incentivize is to keep production down a bit. Russia does not really seem to be a problem. It is more opec as a whole. I think this shows that really over the years the power has shifted from the opec group to the larger opec and that russia and saudi arabia hold the reins here. It will be difficult for big producers like iraq to recognize they will have very little power anymore. Kailey down to two key players. How is the group as a whole thinking about the vaccine . I feel like that is a key question for this meeting in particular. We were having a conversation with someone from Johns Hopkins who said we are still basically a long way away from ending the pandemic. What does that mean from a demand forecast perspective that opec has to factor in . Ellen yes, exactly. They are very optimistic about the vaccine. But as the algerian oil minister, who is the president of opec for this year, mentioned in his opening remarks, that despite the positive news of the vaccine, that has started showing up in oil prices as soon as we heard things about the vaccine. Oil prices started to shoot up. We still got these major demand problems. Demand is low in the United States and europe, which are major consumers. It does not look like that will pick up anytime soon. Because while we have a lot a positive sentiment, we dont necessarily have we are not seeing that play out on the ground in the u. S. And in europe. In asia, particularly in china, we are seeing much more positive signals. That could affect how some of these countries, these big exporters to asia, are viewing the market. They are saying, hey, we realize that demand is slow in europe and the United States because of the virus. And the vaccine may not be bringing things back to normal for another six months at least. But we are over in china. We want to export more oil there. Kailey how much does the complication complicate the equation . Ellen exactly. You have that going on as well. You have people looking at the market saying, hey, we are out of this previous phase where things were looking bad and things are looking better. Why shouldnt we ease up on these cuts . Why dont we take advantage of these better prices and better situations and put a little more oil on the market now that things are ease and death are easing up are easing up . On the other hand, if opec does not curb production for longer, they can weigh in on this oil rally and cause a tumble. A fine line they are walking. Kailey absolutely. Last question for you. Two months from now we will have a new u. S. President. How is opec thinking about the Incoming Biden Administration . Both what it means for Oil Production, shale, and potentially what it means for iran . Ellen in the longterm picture of Oil Production, oilproducing nations are pretty happy about that. Because they realize the trump ministration was really kind of full speed ahead, drill, baby, drill, Oil Production in the u. S. That got the u. S. Up to 13 Million Barrels a day of production. That is not so great for them. What we are now looking at, u. S. Production has been in the 10. 5 million barrel a day range. It could go lower or a little higher. They see the Biden Administration as they will not cut off Oil Production atogether, but things will be bit more restrained in the u. S. , which is good for them and good for oil prices overall. Kailey valuable insight. Of theings to ellen wald other into council. He ahead, we will have our stock of the hour. We are looking at a down day to close out the month of november. The s p 500 down 0. 7 . Small caps the relative laggards here, down more than 1. 5 percentage points. It is Energy Financials leading the decline today. The cyclical rotation off of the positive vaccine news not happening on this monday. Stay with us. This is bloomberg. Kailey this is Bloomberg Markets. Im kailey leinz. Lets have a check of your Bloomberg Business flash headlines. Lets start with bitcoin. I know i said i would not talk about it again, but i will talk about it again. Climbing bitcoin past the record set in december 20 17 that catapulted the cryptocurrency into mainstream consciousness. The Worlds Largest asset rallied and sent shares of crypto related stocks soaring. Bloomberg has learned airbnb and doordash will propose higher valuations for their ipos this week. Both companies are starting their roadshows. Airbnb is targeting a range of 30 billion to 33 billion. Doordash plans to 5 billion to 28 billion. Both companies are looking to go public by the end of the year. As of Clean Energy Clean energy Trucking Company collapsed today. Instead, there is a new nonbinding agreement to buy Hydrogen Fuel technology. Gm will not be seeking and an equity stake in nikola. That is your Bloomberg Business flash. Time now for the start of the hour. What is shaping up to be the largest deal in the u. S. This year, s p global buying ihs deal. , a 43 billion Abigail Doolittle is here with the details. Abigail it really is certainly a large deal in a hot space. Both of those stocks trading higher. One reason we know that the data in the Information Space is such a popular space, at least for investors, and based on revenue, youre over the last five years, we see ihs market and s p global up about 275 over the last five years relative to the s p 500, about 75 . That is the valuation and the premium that investors are putting on the data companies. As for why, we look at ihs markets revenues, they are certainly moving in the right direction. 2014, about 1 billion. Estimated in 2021 to be around 4. 6 billion. Huge growth. Slow, which of a could explain why it is selling. It is worth noting this is a very rich deal, about 10 times revenue. So this consolidation is coming at a huge premium. , itor the deal size is unclear whether the astrazeneca deal will happen. Otherwise, it puts ihs market and s p global in the top spot 43. 5 billion. Chip stock buying. Lots of big deals this year. Kailey but this is not done. It still has to go potential regulatory journey. Could it get stopped . Abigail something i always look at to see whether or not there could be issues ahead and whether or not the stock is trading at the price that has been offered. Trading at 10 discount at 43 billion. Pause is the one possibility for regulation or scrutiny, given the fact that they will be such a big company in the space. Basisillion on a combined and s p on its own, 2. 7 billion. Interesting to see whether or not investors bringing to share prices up to the deal price where that is an indication there could be more news happening ahead around this deal. Kailey all right, abigail. Thank you so much. We have some breaking news on the political front we want to bring you first and foremost coming from arizona. The state now certifying the victory for president elect joe biden, as well as mark kelly, who was in the senate race, the husband of gabby gifford, the senator who was shot. Arizona certifying the results of the elections in that state. In the biden administers