Daybreak Weekend: US Jobs, Wimbledon Tournament, Vietnam Eco

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2:00Bloomberg 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 some key jobs data in the U.S. and how they may affect Fed policy moving forward. I'm Nathan Hager in Washington. I'm Caroline Hepkitt in London, where we're asking if this year's Wimbledon tournament can serve up an ace. I'm Doug Krisner, looking at the balance of growth and inflation for Vietnam's economy. That's all straight ahead on Bloomberg Daybreak Weekend. On Bloomberg 1130 New York, Bloomberg 99.1 Washington, D.C., Bloomberg 92.9 Boston, DAB Digital Radio London, Sirius XM 121, and around the world on BloombergRadio.com and the Bloomberg Business App.

3:00Good day to you. I'm Nathan Hager. We begin today's program with some key economic data in the U.S. On Thursday, we get non-farm payroll numbers for the month of June at 8.30 a.m. Wall Street time. The report is coming a day earlier than usual due to the Independence Day observance. Here for a look ahead to the numbers is Edward Harrison, Bloomberg senior strategist and author of the Everything Risk newsletter. Good to have you with us ahead of Jobs Thursday, Ed. It seems like we've been talking for so long about a low-hire, low-fire labor market. Do you see that shifting ahead of what's to come this week?

3:35Hi, Nathan. I think, yes, I do see that shifting. This low-fire, low-hire market that we've seen, I think last month's number broke that streak. We got 172 ,000 jobs added to non-form payrolls. We also had upward revisions to the prior months to the point where the three-month average was even higher at 188 ,000. So we're looking at almost 200 ,000 jobs per month being added to non-farm payrolls over the last three months. So do you see that trajectory continuing? I mean, 200 ,000 on average sounds like more of a steady labor environment than we've seen lately. It definitely does seem that way.

4:23Now, The average economist in Bloomberg consensus survey says around 135 added. But even if you have 135, that's 50 ,000 lower than the average that we had before. You're really still looking, if we get that number, at around 150 ,000, 160 ,000 jobs per month for the last three months. And that's very good. And the unemployment rate would be at 4.3%. What that says is we do have an improvement in the labor market in the U.S. What do you see underpinning that improvement when, you know, so many economists leading into these non-farm payrolls reports month in and month out have sort of been surprised by the resilience in the labor market?

5:10Well, you know, I think that the resilience in personal income and spending has been a big part of that. If you looked at the numbers that came in last week, we saw that personal spending was up 0.7 % month on month. That was above expectations. Personal income was also up 0.7 % above expectations. Of course, that brings inflation with it because the headline PCE price index increased by 4.1%, over 4%. That's like double the Fed's target in the year to May. But irrespective, you know, you've got income and spending underpinning the ability for jobs to continue. Do you see wages keeping up with the pressures that we continue to see in prices like that Fed preferred inflation gauge that you just mentioned?

6:09Yeah, I think that the closer that we get to full employment, the more chance that you're going to see wages increasing. The number that we saw in the last month, that is in May's survey, was 3.4 % for average hourly earnings year on year. Economists are expecting 3.5%. So they're expecting that to go up. And that's going to give people the wherewithal to a certain degree to deal with the inflation that we've seen over the last year. And, you know, with all those factors in place, it sounds as though the bias that we heard from Fed Chair Kevin Warsh earlier this month toward reining in inflation might be justified here.

6:58What's your expectation when it comes to the Fed potentially trying to rein in some of these increases that we're talking about with a hike? I think that the Fed is going to hike this year. The market has sort of backed off what it's thinking in terms of hikes. We have the market expecting at least one hike this year, not two hikes. The first date in which they expect a hike is in October. So that's three Fed meetings from now. We have July, September, and October. I would say that the likelihood that they do hike, given what we've seen in the inflation picture, is sooner than the market expects.

7:43And depending upon how this jobs number comes out, we could see then jobs doing very well, inflation being high, especially core inflation, and those two leading the market to start pricing in an earlier rate hike and potentially two hikes in 2026. Really appreciate this, Ed. Again, thanks for coming on with us ahead of Jobs Thursday. That's Edward Harrison, Bloomberg senior strategist and author of the Everything Risk newsletter. Let's take a look now at some stocks making news in the week ahead. I'm Nathan Hager, joined by Christina Kino, managing editor for Bloomberg Markets Live on a week where we're going to hear from a few more Companies reporting earnings as we wind down the season, Christine.

8:26A few household names this week, including Nike on Tuesday. Are investors finally going to hear the turnaround is swishing upward for a change? I see what you did there, Nathan. Yes, that is definitely the hope. Very interesting, though, because they announced a leadership change shortly before the earnings results, which are due on the 30th of June. So apparently David Denton will take over as CFO in August. And interestingly, he is not an insider. He hasn't been a career employee at Nike. He's actually moving from Pfizer and has done similar stints at Lowe's and CVS as well. So that's quite interesting, bringing in an outsider rather than someone who's familiar with the business and familiar with the turnaround plan.

9:10Obviously a pretty big change from bringing in a former insider to be the CEO. So what kind of fresh blood or fresh look at the company could we expect once they report earnings this week? Yeah, I mean, that is the big question, isn't it, Nathan? That's something that investors and analysts will definitely note. I mean, Citigroup analysts noting that it is quite surprising that they're doing this just ahead of those fourth quarter results, especially because the company is still under immense pressure to really show the results of this turnaround plan. The stock price is still hovering at around the lowest since 2014, and investor confidence is a little bit still at the lows.

9:49But, you know, maybe fresh blood might be just what the company needs for a bit of a turnaround here. But we'll find out more when they give us the details next week. Absolutely. Also on Tuesday, we're going to get results from Constellation Brands after the bell. It's been a tough time for the beer and wine business. Are we going to be able to raise a glass to these results? I mean, based on the assessment from Jeffries' analysts, there's still a lot of caution on that front, Nathan. I mean, they're worried about just the overall trend of declining alcohol consumption trends in the U.S. Because, you know, the younger generation don't drink as much anymore.

10:28I don't know what's up with that. But that's definitely something that is a bit of a negative for Constellation Brands. Jeffries in particular, still expecting the company to reiterate those organic sales around minus 1 % to plus 1%. But one silver lining is they do have strong ad spending for the World Cup, but then that also cuts into their earnings margin. So we'll see if that pays off when we get those results. It might be a little bit early, but a little bit of positive momentum can't hurt the brand at this moment. Yeah, so a lot of crosswinds there, not just from consumer changing habits and those advertising spending potential headwinds there.

11:10But, I mean, the entire beverage industry has been dealing with rising commodity costs from what's been happening in the Middle East as well. I mean, that could have an impact on the results too, couldn't it? Yeah, absolutely. I mean, margins, definitely something to watch for Constellation brands. I mean, some of the costs for raw materials, aluminum cans, for instance, have gotten a lot more expensive over the last few months. Of course, we know that flows through the Strait of Hormuz finally starting to flow. We've been getting reports on that as well as U.S. and Iran make headway towards kind of striking a longer term deal.

11:46But yeah, it takes a little bit of time, doesn't it? And we've definitely seen a lag in some of those prices when it comes to kind of coming back down from the recent highs. So that's something that Constellation brands will definitely have to answer for when we hear from them next week. Yeah, I'll be interested to hear as well about how they might be adapting to those changing consumer habits, because it seems like there's been a lot more interest as well in non-alcoholic beer and wine. So we'll be watching that, too. On Wednesday, we're going to hear from General Mills. And correct me if I'm wrong, Christine, but it seems like the last few months have been pretty rough for name brands at the grocery aisle.

12:20Am I remembering that right? Yeah, that's absolutely right. It has been a tough period, but we are seeing, for instance, Bloomberg Intelligence analysts saying that perhaps actually the worst of it might be over for some of the national food brands like General Mills. They're projecting that some of the sales for these brands could climb about 3 % to 4 % this year. I mean, of course, house brands have an advantage, especially when it comes to costs for consumers. But I think there's a little bit of room now for some of the brand names to gain back some of that ground. And, you know, another theme actually that could be going well for General Mills is the pet food business.

13:00Because we know that people love spending money on their pets. Oh, yeah. And that is something that could be a bright spot potentially. Okay. I kind of wonder, though, whether a company like General Mills and some of its competitors as well might be weathering some of these issues around price by doing something that I've seen over the last few months, if not years, packaging getting smaller. Is that something we could hear about on the call? Yeah, I mean, that's certainly one way to mitigate some of the costs, right, that we've been talking about in relation to other companies. And certainly if you're spending less on packaging, especially given the current era of still high raw material prices, that certainly helps for sure.

13:46And so, yeah, maybe something that could at the margin help General Mills kind of gain more solid footing here. But yeah, we'll hear from them on the 1st of July is when their earnings are due. Yeah, a lot of big consumer names to look forward to on the earnings front this week. Thanks for this, Christine. Really good to have you with us. That's Christine Aquino, Managing Editor for Bloomberg Markets Live. And coming up on Bloomberg Daybreak Weekend, we will look ahead to this year's Wimbledon tournament. I'm Nathan Hager, and this is Bloomberg.

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17:07I'm Nathan Hager in Washington. Later in the program, we'll look to some key economic data coming up this week in Vietnam. But in the coming days, London's All England Club once again becomes home to the biggest stars in tennis as they battle for one of the sport's most prestigious titles. This year's edition of Wimbledon promises to be eventful as one of the greatest ever living players makes her return and ticket resale prices soar. For more, let's go to London and bring in Bloomberg Daybreak Europe anchor Caroline Hepker. Nathan, Wimbledon is a British institution. In years gone by, it's featured classic battles between greats like Federer and Nadal.

17:47Many a royal spectator and even carried the hopes of a nation as British players have pursued glory on home turf. This year is set to be no exception with the competition already making headlines. Seven-time champion Serena Williams, considered by many to be one of the greatest players of the Open era, will make her return to singles tennis at Wimbledon. After retiring in 2022, the 42-year-old received a controversial wildcard spot at the competition, driving further interest in this year's event. Bloomberg's reporting, though, has found that ticketing is more exclusive than ever. Debentures, a niche financial instrument that grants the holders some of the best seats at Wimbledon, are now changing hands for more than half a million dollars.

18:34Soaring prices for fans is a phenomenon taking hold of much of the rest of the sporting world, too. It's part of the reason that investors are paying much more attention to the profits from sports. Dave Days is global co-head of sports franchise and investment banking at Goldman Sachs. He says growing interest in the sector is a big opportunity. We're seeing a lot of interest across really three different groups of buyers. But you can aggregate audience. Media rights are growing pretty dramatically given that sense. is something people want to be part of. And so, again, it's back to this community.

19:12You have pricing leverage, the ability to really grow. And for the North American leagues and the many leagues around the world, you do have some level of governance, in essence, salary cap in place, where you have some level of control in terms of the costs. But there are many, many different ways you can grow from a revenue perspective. That was Dave Days from Goldman Sachs speaking to Bloomberg's Lisa Bramowitz and Anne-Marie Hordern. Joining us now for more on what to expect from this year's Wimbledon and the intricacies of ticket pricing is Bloomberg's UK business editor Jamie Nimmo and our reporter Aisha Diallo.

19:50Welcome to both of you. Thanks for your time. Jamie, I want to start with you because this is quite a niche little business, isn't it, that Wimbledon has. in terms of the tickets for Centre Court and Court No. 1 at Wimbledon. Explain how it works. What are these debentures? Yeah, well, most people will enter the ballot and pay a few hundred quid, and if they're lucky, they can get a ticket to Centre Court or Court 1. If you're not one of those people, you might queue up for hours overnight in a tent or whatever, and then you might get a ticket for the outside courts. If you're one of the lucky few, there are these debentures.

20:23So it's about two and a half thousand in Centre Court, one and a half thousand in Court 1 or 1 ,300 Court 1. And then you basically have the tickets next to the Royal Box. You can access the VIP areas, the restaurants, all the fancy bits that go on. Swish, lovely. Exactly. Now, the catch is you have to pay a lot of money to get these tickets. So the Centre Court debentures that start this year went on sale two years ago at 116 grand. So you need a bit of money to spend on these things. But then you're guaranteed ticket for, you know, 14 days every year for five years. Right. So, you know, it's a pretty nice gig if you can get it.

21:03Yeah. And they're classed as transferable securities to get some kind of tax benefits in the UK as well. So, yeah, it is interesting. And you can sell the tickets as well if you don't want to go on a certain number of days. Yeah, that's the kind of quirky thing about these because you can't sell any other Wimbledon tickets. So if we bought a ticket via Wimbledon, you can't resell that ticket. But these are the only tradable tickets. So you can make a load of money because the demand from people from the US, India, China, coming over to visit London for the summer, they'll want to go to Wimbledon.

21:35They'll pay thousands of pounds. So you can make the money back on those days. You can go whenever you want. It might be that you just want to go to the men's and women's finals in the last weekend. Well, sure. and sell all the other days and you can make more than your money back, basically. Okay. Which is fascinating. I think that's really interesting, isn't it? We'll get into the kind of quirks and the traditions of Rimbledon and so on in a moment. Aisha, you've been to lots of Grand Slams, not to SW19, but it is quite different, isn't it? The way that all of the Grand Slams around the world operate in terms of the tennis traditions and what you see in terms of sports.

22:15Wimbledon is the most prestigious Grand Slam of the four. If you ask many players, they'll tell you if they could win one slam, it's going to be Wimbledon. I mean, it's the first one. It began in 1877. You know, players are donned and all white. This was from a tradition that started since its beginning where they didn't want to see the sweat of players through their clothing because it wasn't proper. So there are many kind of quirks of the tournament, including the all whites, as well as the queue, as we mentioned briefly. You know, this is maybe one of the few sporting events where you can line up and get tickets day of, which is pretty interesting.

23:00And even on court, I think you'll also notice that you'll see minimal advertising as opposed to the other Grand Slams. this is for the clean look that Wimbledon likes to have and that's just one of many. When you think about Wimbledon you also think about strawberries and cream and kind of these interesting things that attendees get to experience who are also dressed to the nines compared to other Grand Slam events as well. Yeah and this year could be really exciting with Serena back and whether she has a chance of winning. I mean, who are the favourites this year? And for that global audience, you know, that, as Jamie was saying, sees so much appeal in Wimbledon and for kind of diehard tennis fans, obviously this is a major annual event.

23:48So who do you think are the favourites this year? When you look at the men's side, you know, this is another tournament this year that we're not going to see Carlos Alcaraz, the number two player in the world. I think the man to beat in much of the year is going to be Yannick Sinner, the number one player. Even though he hasn't won a Grand Slam this year, he's won pretty much everything else. He is the defending champion as well. I think you could also say that Novak Djokovic, this might be his last good shot at number 25 for him. I think Jack Draper, hometown hero, he's coming off of injury. He has Andy Murray on his coaching team this upcoming Wimbledon.

24:28He's playing good. And I think he's going to have the backing of the British crowd, of course. So I wouldn't count Jack Draper out as well. On the women's side, I think it's going to be a bit of a toss up. Last year, we saw kind of a random winner in Iga Sviantec. I think it's going to be a toss up on the women's side. I would say it's going to be a random winner. I think Irina Sabalenka, the number one player, has been a little bit shaky. She lost in Berlin a few weeks ago to Jessica Pagula. So we'll see. It's going to be a toss up on the women's side. Aisha, Serena is back playing at Wimbledon.

25:03Why do you think she's coming back at this point in her career? What do you think she's going to serve up at Wimbledon? It's going to be a challenge for Serena. You know, she's coming back without much match play at 44 years old. It's going to be quite demanding physically to play singles on the grass courts. We're going to see she is one of the greatest competitors, if not the greatest competitor of all time. but if I was a betting woman I wouldn't put my money on her to say that. Okay so those are all the runners and riders then and what may be possible on court I mean also we're going through a heat wave in the UK so if that continues it's going to be quite interesting and maybe shake things up certainly present some difficulties for the grass courts of course at Centre Court.

25:45Jamie the business side of this I mean why are we seeing so much demand though for these debentures tickets i mean they've existed for ages the structure of them has kind of changed over time hasn't it the rights that it confers on people but you've written um a really interesting story about the price of these uh particular tickets in the sporting world has just gone through the roof it's astronomic why what is driving that demand yeah right we you know when when i mentioned earlier they went on sale for 116 000 pounds that sounds a lot but in the two years since you know recent trading prices are up at nearly 400 ,000 for these.

26:24So you're talking, you know, that's more than, you know, made of an NVIDIA stock in that time. You know, it's pretty incredible. The demand is partly in line with ticket prices as well. Like the demand generally to attend is driving up ticket prices, which is then driving up the debenture sort of values. But like you say, it's, you know, it's interest from all around the world. You know, say if you're growing demand from India as well, which you're seeing younger people from India travel all around the world, especially to places like London in the summer. They might go to the cricket this summer, and then they might think, what else can I go to?