Episode summary
Daybreak Weekend: US Housing, Germany Summit, BOK Decision | Bloomberg Daybreak: US Edition
Bloomberg Daybreak: US Edition
· · 39 min · Hosts: Nathan Hager
Summary
The episode previewed a busy week for investors with three main themes: weak U.S. housing, major earnings from Netflix, Tesla and Meta, and policy and political tests in Germany and South Korea. In the U.S., Nathan Hager focused on housing data, where Bloomberg Intelligence analyst Drew Reading argued that higher mortgage rates, softer consumer confidence and a rise in cancellations point to continued pressure on pending home sales and new construction. He said builders are still matching production to sales and have little incentive to add supply while demand remains weak.
The earnings preview centered on whether big growth companies can justify lofty expectations. For Netflix, the focus is on engagement, with investors watching whether viewing hours and audience trends stabilize after recent declines. For Tesla, the key issue is capital spending, especially on Cybercab and Optimus, while Meta’s stronger AI narrative got a boost from the rapid adoption of Muse.
In Europe, the discussion turned to Germany’s summit in Berlin, where Chancellor Friedrich Merz is trying to persuade global investors that the country is open for business again despite weak growth, high energy costs and political fragility. In Asia, Bloomberg’s Seoul bureau chief described the Bank of Korea as balancing sticky inflation, chip-led growth, property risks and market leverage as it considers its next rate move.
Key takeaways
- Drew Reading said U.S. pending home sales risk remains to the downside as 7.5% mortgage rates, weaker confidence and cancellations hit the market.
- The housing analyst said builders are likely to keep matching production to sales because completed inventory is still elevated and demand is soft.
- Netflix investors will focus on whether viewing hours, down almost 11% from last year, begin to recover.
- Tesla’s earnings call is likely to center on its planned $25 billion in capex and spending on Cybercab and Optimus.
- Germany’s pitch to investors rests on infrastructure and defense spending, but Chris Bryant said Friedrich Merz still faces weak popularity and structural headwinds.
- The Bank of Korea must weigh sticky inflation, chip-sector strength and leverage risks as it decides whether to pause after two rate hikes.
Notable quotes
“the market has gotten increasingly challenging through the summer and into the early fall”
“there's really not a whole lot of incentive with demand being as weak as it is to continue to put new product in the market”
“I think investors want to see those viewing hours start to reverse their decline”
“They've said they want to spend $25 billion in capital expenditures this year, which is triple the amount that they spent last year”
“Germany remains, I think it's fair to say, in a bit of a fraught situation”
How the episode opens
Bloomberg Audio Studios, podcasts, radio, news. This is Bloomberg Daybreak Weekend, our global look at the top stories in the coming week from our Daybreak anchors all around the world. Straight ahead on the program, we look to housing data along with some key media and tech earnings in the US. I'm Nathan Hager in Washington. I'm Caroline Heper in London where we're looking at Germany's pitch to investors at a key summit in Berlin.
I'm Doug Krer looking at the South Korean economy and the approaching rate decision from the Bank of Korea. That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg 1130 New York, Bloomberg 991 Washington DC, Bloomberg 929 Boston, DAB Digital Radio London, SiriusXM121, and around the world on Bloombergradio.com and the Bloomberg Business App. Good day to you.
I'm Nathan Hager. We begin today's program with some key housing data in the US. On Tuesday, we get reports on new home projects getting started in September, plus a look at home sales that were still waiting to be closed in the month.
For more on this and the overall outlook for the home building sector, we want to bring in Drew Reading. He's US home building analyst for Bloomberg Intelligence. Always great to speak with you, Drew.
Of course, we've talked many times before about how not so great this housing environment's been with prices and mortgage rates still elevated. So, what are we expecting from this latest data for September?
Yeah, so the market has gotten increasingly challenging through the summer and into the early fall. Um, looking ahead to the pending home sales data, the consensus is looking for about a 1% sequential increase. Um, but I think the risk is certainly skewed to the downside. Um, we've got some high frequency data for Redfin that shows that pending home sales were actually down 4% sequentially last month, which is the lowest level since 2014.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- us housing data
- berlin summit
- bank of korea decision
- monetary policy
- stock outlook
Watch the episode
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
More from Bloomberg Daybreak: US Edition
-
Nvidia Faces Post-Huang Reckoning, Microsoft Races to Fix Outage | Bloomberg Daybreak: US Edition -
Daybreak Weekend: Nvidia Earnings, UK Labour Market, APEC Summit | Bloomberg Daybreak: US Edition -
Nvidia Weighs Succession Plans; Congress Preparing to Subpoena Jensen Huang | Bloomberg... -
GOP Thwarts Hegseth Impeachment; CoreWeave Quiets Doubts | Bloomberg Daybreak: US Edition -
FBI Investigates Nvidia CEO, Anthropic IPO Snafu | Bloomberg Daybreak: US Edition -
Nvidia CEO Affair Sparks Probe, Trump Admits Policy Mistake | Bloomberg Daybreak: US Edition
Bloomberg Daybreak: US Edition, this episode and its artwork belong to Bloomberg. Octagon is not affiliated with the show; this page is an independent summary.
