# Big Tech Earnings Roll In, Treasury Yields Spike After Fed Decision

An episode of [Bloomberg Daybreak: Asia Edition](https://invisiblenetwork.ai/podcast/1663863437), 30 Jul 2026, 22 min.

Audio: https://podtrac.com/pts/redirect.mp3/traffic.omny.fm/d/clips/e73c998e-6e60-432f-8610-ae210140c5b1/58e85be7-dbb5-4043-afed-af80014dc0b3/a075e668-3fc8-4e7f-9d0d-b497001c1217/audio.mp3?utm_source=Podcast&in_playlist=27143354-63aa-4ac5-965d-af80014dc0d3

Business and finance news from the Asia-Pacific. Microsoft Corp. climbed almost 9% in extended trading after reporting its fastest cloud-computing growth in four years. Samsung Electronics Co. rose over 1% after chip profit soared over 250-fold. Meta Platforms Inc., however, fell over 7% in post-market trading following a disappointing revenue forecast for the current year. For more analysis, we spoke to MS Hwang, Research Director at Counterpoint Research. Plus - Federal Reserve Chairman Kevin Warsh has said the decision to leave interest rates unchanged wasn't a sign of inertia at the central bank, which is committed to tackling inflation. Brown University Professor of International Economics Sebnem Kalemli-Ozcan breaks down how markets are interpreting the signals. She spoke to Bloomberg TV host Haidi Stroud-Watts. See omnystudio.com/listener for privacy information.

## Transcript

[0:02] Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.
[0:10] Speaker 2: Welcome to the Daybreak Asia podcast. I'm Doug Prisner. The
[0:13] Speaker 2: tone in Asian equity trading is being influenced by continued
[0:17] Speaker 2: weakness in US chip stocks, as well as some Megacap
[0:21] Speaker 2: earnings that were reported after the bell. Now, the Philadelphia
[0:24] Speaker 2: Semiconductor Index was down for a fifth straight session, dropping
[0:29] Speaker 2: five point three percent, and in the last five trading days,
[0:32] Speaker 2: the socks is down nearly sixteen percent. Now regarding those
[0:36] Speaker 2: earnings after the bell, Meta gave a disappointing outlook for
[0:39] Speaker 2: revenue in the current quarter, and Microsoft reported results for
[0:44] Speaker 2: the latest quarter that were above forecast. For a closer
[0:48] Speaker 2: look at some of the market action, I'm joined by
[0:50] Speaker 2: ms Wong. He is one of the chief analysts at
[0:53] Speaker 2: Counterpoint Research and he joins us from San Francisco. Thank
[0:56] Speaker 2: you for being here. Let me begin with the chip makers.
[0:59] Speaker 2: I want to get your take. Obviously, there's been a
[1:02] Speaker 2: lot of weakness lately. I just referenced the pullback that
[1:05] Speaker 2: we have seen in the Philadelphia Semiconductor Index. What's your
[1:09] Speaker 2: sense of what's been happening with the chip stocks lately.
[1:13] Speaker 3: We can separate the two things at the same time,
[1:17] Speaker 3: one is a sustainability of the capital spending from the hyperscalers.
[1:23] Speaker 3: The other one is the so called the chifflation the
[1:27] Speaker 3: price elasticity in demand because memory pricing has been, as
[1:31] Speaker 3: you pointed out, very high up in the sky and
[1:36] Speaker 3: people are concerning whether this is going to weakening demand
[1:41] Speaker 3: profile going forward. So basically same thing. The hyperscalers may
[1:46] Speaker 3: weaken its capital spending based on lots of macro effects
[1:50] Speaker 3: and the revenue growth for example, but at the same
[1:53] Speaker 3: time people are concerning that too much high pricing in
[1:57] Speaker 3: the memory is going to destroy the demand, which is
[2:01] Speaker 3: what we are seeing in the smilephone market that everyone
[2:06] Speaker 3: needs to raise either pricing or pull back their production
[2:10] Speaker 3: because of the cost issue. So those are two factors
[2:15] Speaker 3: making a bit more concern in the market. So that
[2:19] Speaker 3: has been one of the reasons why dragging on top
[2:23] Speaker 3: of it, there are China factors that one of its
[2:26] Speaker 3: competitives listed in China market and they are coming with
[2:32] Speaker 3: the own tools as well. So those all together is
[2:36] Speaker 3: making a negative sentiment and profit taking action in the market,
[2:40] Speaker 3: I believe.
[2:41] Speaker 2: So you're speaking, I think of CXMT, which we can
[2:44] Speaker 2: talk about in the moment. This is the Chinese Emperor
[2:47] Speaker 2: chip maker. Yes, I just had an IPO recently, and
[2:51] Speaker 2: I'm glad you referred to the smartphone makers because Qualcom
[2:56] Speaker 2: was also reporting earnings for the latest quarter after the
[2:59] Speaker 2: bell in the US on Wednesday, and we know this
[3:02] Speaker 2: company is the largest maker of those smartphone processors. The
[3:06] Speaker 2: forecast for profit in the current quarter I think was
[3:09] Speaker 2: a little troublesome. It seems to be weak, and it
[3:13] Speaker 2: kind of goes to the point that you made about
[3:15] Speaker 2: component shortages and rising costs taking a toll on the
[3:18] Speaker 2: smartphone business. But I'm also curious to get your take
[3:22] Speaker 2: on what we've been hearing coming out of South Korea.
[3:24] Speaker 2: We had the sk Heinex numbers five hundred and fifty
[3:29] Speaker 2: seven percent increase in operating profit. That sounds stunning. And
[3:34] Speaker 2: at the same time, sk Heinez earmarked record capex for
[3:39] Speaker 2: the year of at least thirty one billion dollars. So
[3:42] Speaker 2: obviously a company like this, which is one of the
[3:44] Speaker 2: leaders in high bandwidth memory production, sees the market continuing
[3:49] Speaker 2: to expand, that demand for these memory chips will continue
[3:53] Speaker 2: far into the future. Maybe it's into twenty twenty eight,
[3:57] Speaker 2: but you I sense a little dubious that the market
[4:00] Speaker 2: is going to hold up. What's your what's your rationale?
[4:06] Speaker 3: I believe the stock market is always kind of a
[4:09] Speaker 3: racing game relative to the expectation. We all know that
[4:13] Speaker 3: AI demand is a strong, We all know that Skihiinix
[4:17] Speaker 3: earnings is going to fly out. But these days, these
[4:23] Speaker 3: are suppliers are locking up their supply into a long
[4:27] Speaker 3: term agreement three to five year deal, and at the
[4:31] Speaker 3: same time there is going to be a certain level
[4:33] Speaker 3: of a fixed pricing for the longer term. So nowadays
[4:38] Speaker 3: the pricing in memory market is going up every day
[4:42] Speaker 3: every month. It's for example, second quarter pricing gone up
[4:46] Speaker 3: like an eighty. So if one company is settled down
[4:50] Speaker 3: in a long term contract a little bit earlier, then
[4:54] Speaker 3: they're going to miss out all the values during the quarter.
[4:57] Speaker 3: I believe those timing issue is making a bit of
[5:04] Speaker 3: below consensus estimate earnings in the second quarter, and on
[5:09] Speaker 3: top of it, there are many issues that we talk about.
[5:14] Speaker 3: It's going to have a negative impact. So initial response
[5:20] Speaker 3: on the share price, despite all these good earnings and
[5:23] Speaker 3: the outlook, share price reaction was quite negative.
[5:29] Speaker 2: So I'm just now as we're speaking, getting the earnings
[5:32] Speaker 2: for the second quarter from Samsung better than expected at
[5:36] Speaker 2: seventy one point two seven trillion Korean one. This is
[5:40] Speaker 2: for Q two. Now we know that the memory chip
[5:44] Speaker 2: manufacturing industry is pretty concentrated. There is Samsung and s
[5:48] Speaker 2: K Heinez in South Korea. In the US, we have
[5:52] Speaker 2: Micron Technology, and now we have a company in China, CXMT.
[5:57] Speaker 2: Can you imagine a world where XMT starts to export
[6:02] Speaker 2: chips not just manufactured for the Chinese market, but something
[6:06] Speaker 2: that would have kind of a global impact.
[6:11] Speaker 3: Of course, I believe that the meaning of the IPO
[6:14] Speaker 3: of CXMT is not only that CXMT is making chips
[6:21] Speaker 3: for local market, but the real meaning of the IPO
[6:26] Speaker 3: is that it is already a fulld global supplier. We
[6:31] Speaker 3: can't really name who is a supplier because there are
[6:35] Speaker 3: already multiple customers are locking in the supply of the
[6:39] Speaker 3: CXM chips, not only the Chinese OEMs, but also global
[6:45] Speaker 3: OEMs as well, or some more people, More and more
[6:49] Speaker 3: companies are ready to secure the procurement because we are
[6:55] Speaker 3: under extreme supply shortage in the memory. Chinese are not
[7:00] Speaker 3: cheaper than peer groups anymore. But if it helps to
[7:06] Speaker 3: solve the supply bottleneck. Why not.
[7:11] Speaker 2: Well, it's interesting you make that point because on the
[7:14] Speaker 2: Bloomberg right now I'm getting a headline that US lawmakers
[7:17] Speaker 2: have sent a letter to Apple CEO Tim Cook basically
[7:22] Speaker 2: advising or warning Apple not to buy memory chips from
[7:26] Speaker 2: Chinese firms. What will the impact of that type of
[7:30] Speaker 2: policy be in your view?
[7:33] Speaker 3: It is possible if the product is being sold in
[7:37] Speaker 3: US soil. But if the product is being sold otherwise,
[7:41] Speaker 3: for example, in China or nearby China, I believe that
[7:48] Speaker 3: that's what apples are looking for. Of course, this is
[7:52] Speaker 3: a sensitive issue in terms of political and geopolitical issue.
[7:58] Speaker 3: But however, I believe that more and more companies are
[8:02] Speaker 3: willing to take an opportunity to source the chips from China.
[8:08] Speaker 3: But now the question is a twofold. One is the
[8:11] Speaker 3: product quality, and two is a political thing. In terms
[8:16] Speaker 3: of product quality, it's not the best I can say.
[8:21] Speaker 3: But you know, DRAM and nand nand is not really
[8:25] Speaker 3: a standard product. But DRAM is a standard product on
[8:29] Speaker 3: the Jedek standard. So if you are qualified, you can
[8:34] Speaker 3: sell it. You can replace other chip vendors, and at
[8:38] Speaker 3: the same time, in China, I reckon that there is
[8:42] Speaker 3: a bit of a sales subsidy. For example, if you
[8:46] Speaker 3: manufacture your hardware in China and if you are buying
[8:50] Speaker 3: China chips, then you get entitled to get some part
[8:55] Speaker 3: of your procurement proceed procure amount from as a subsidy.
[9:01] Speaker 3: That is a good help, especially under these a bomb
[9:04] Speaker 3: cost concern.
[9:06] Speaker 2: When I'm listening to you, I'm thinking of the Chinese
[9:09] Speaker 2: electric vehicle industry, and I don't know why with that
[9:12] Speaker 2: level of government subsidy, the degree to which manufacturers in
[9:16] Speaker 2: China were able to offer very very low prices and
[9:20] Speaker 2: essentially put the pressure on any competitor, whether it was
[9:24] Speaker 2: Tesla in China or European car manufacturers. So is this
[9:30] Speaker 2: a part of the strategy too on the part of Beijing,
[9:32] Speaker 2: that you want to come in and apply pressure on
[9:36] Speaker 2: competitors as a way of making life very difficult for them.
[9:40] Speaker 3: It is, But the difference between the IT product and
[9:45] Speaker 3: the automaker is automakers are a lot more long tailed products.
[9:50] Speaker 3: If you buy Tesla, for example, it can run five years.
[9:54] Speaker 3: But if you buy a smalltphone maybe on Eero too,
[9:58] Speaker 3: then then you need to replace it. Same goes to
[10:01] Speaker 3: AI as smartphones and PCs migrating into an AI, the
[10:08] Speaker 3: lifetime is going to be a lot shorter. So it
[10:11] Speaker 3: is yes, same discipline, same mandate, but the magnitude of
[10:20] Speaker 3: support is a little bit different.
[10:22] Speaker 2: So I'm glad you brought up AI before I let
[10:24] Speaker 2: you go. I think we have to address that issue
[10:27] Speaker 2: because we were talking about the earnings from Meta and
[10:30] Speaker 2: Microsoft obviously to hyperscalers, we were talking about the semiconductor
[10:34] Speaker 2: complex as well, which is a critical part of the
[10:37] Speaker 2: entire AI ecosystem. How are you feeling about AI right now?
[10:43] Speaker 2: And in terms of whether or not the market is
[10:47] Speaker 2: vulnerable to any further disappointment, is that a distinct possibility
[10:52] Speaker 2: in your view?
[10:54] Speaker 3: You know, this has been in the market as a
[10:58] Speaker 3: trillion dollar question, it's going to be the same forever.
[11:03] Speaker 3: But in my own understanding, this is the one, you know,
[11:06] Speaker 3: lifetime opportunity and innovation. Let's look back thirty years ago
[11:12] Speaker 3: when I was young, PC costs about two thousand dollars,
[11:18] Speaker 3: so as an inflation adjusted basis, it's got to be
[11:22] Speaker 3: minimum ten thousand or twenty thousand dollars as of now.
[11:27] Speaker 3: In the meantime, PC cost has been coming down dramatically.
[11:31] Speaker 3: AI cost no cost for token is going to be
[11:34] Speaker 3: the following the same way. So what now these are
[11:39] Speaker 3: Meta or Microsoft, Google, Amazon, This is CSP guys as
[11:44] Speaker 3: well as GPU guys. CPU guys are doing is more
[11:50] Speaker 3: like I call it Jensen strategy, aggressive procurement and if
[11:56] Speaker 3: it is a bit idle, you can hand it over
[11:59] Speaker 3: to other companies like a nail Clouds which was thirty
[12:03] Speaker 3: years ago, like a module company around the PC companies.
[12:08] Speaker 3: I believe that there is this kind of aggressive procurement
[12:12] Speaker 3: and development and leadership is not shrinking, it is expanding,
[12:18] Speaker 3: it is spreading. You probably have seen the AMD's recent
[12:23] Speaker 3: event Advancing AI twenty twenty six. They invested Entropy five
[12:29] Speaker 3: billion dollars, which is sharing the same thing. Some people
[12:33] Speaker 3: say this is a circular reference and this is not sustainable,
[12:38] Speaker 3: but we have to create such leadership. Otherwise nobody put
[12:43] Speaker 3: the money, nothing's happen to happen. So in my understanding,
[12:47] Speaker 3: let's assume up until today we only have one Jensen.
[12:53] Speaker 3: What if you have a multiple Gensen next year. That
[12:57] Speaker 3: is increasing level of competition in it, and everybody is
[13:02] Speaker 3: moving ahead based on each different workload. So we don't
[13:08] Speaker 3: really have to say this is battle right.
[13:12] Speaker 2: Ms, we will leave it there. Thank you so very much.
[13:15] Speaker 2: Mshong is one of the chief analyst at Counterpoint Research.
[13:18] Speaker 2: Joining from San Francisco here on the Daybreak Asia podcast.
[13:30] Speaker 2: Welcome back to the Daybreak Asia Podcast. I'm dek Krisner.
[13:33] Speaker 2: FED policymakers left interest rates unchanged for a fifth straight meeting,
[13:37] Speaker 2: Even so that vote was fractured. Three committee members were
[13:41] Speaker 2: in favor of raising the policy rate by twenty five
[13:43] Speaker 2: basis points, and in his media briefing, Chair Kevin Warsh
[13:48] Speaker 2: sounded hawkish.
[13:49] Speaker 4: For some households, businesses, and market professionals, five years of
[13:54] Speaker 4: high inflation have left a mistaken impression that's hard to
[13:58] Speaker 4: shake that the Fed this implicit inflation target was somehow
[14:02] Speaker 4: above two percent. Let me reiterate, there is no soft
[14:07] Speaker 4: inflation target.
[14:09] Speaker 2: But the bond market seemed to doubt his conviction, and
[14:12] Speaker 2: there was a bit of curiosity as to whether Warsh
[14:14] Speaker 2: was essentially outsourcing FED policy and letting the bond market
[14:18] Speaker 2: do the tightening. We had yield spiking at the long
[14:21] Speaker 2: end of the treasury curve. The thirty year was up
[14:23] Speaker 2: twelve basis points. In New York trading to five point
[14:26] Speaker 2: two one percent. That is the highest level since two
[14:29] Speaker 2: thousand and seven. And that's where we began our conversation
[14:33] Speaker 2: with Subnem calemni os Khan. Subnem is professor of International
[14:38] Speaker 2: economics at Brown University. She spoke with Bloomberg TV host
[14:42] Speaker 2: Heidi Stroud Watts a.
[14:43] Speaker 1: Good family five. He got one, that's for sure. I
[14:47] Speaker 1: do wonder when you take a look at the center votes,
[14:49] Speaker 1: when you take a look at how markets and oppositioning
[14:51] Speaker 1: for the next meeting, is there an issue of credibility
[14:54] Speaker 1: here at stake?
[14:57] Speaker 5: Thank you so much, Hedi for having me on the showls.
[15:00] Speaker 5: So I don't think we are there yet. Of course,
[15:04] Speaker 5: you know, you can interpret these two ways. You know,
[15:08] Speaker 5: at the kind of the bad site, you can interpret
[15:12] Speaker 5: the increase in long term yields as maybe markets are
[15:17] Speaker 5: pricing in problem with FED credibility. But my interpretation is
[15:22] Speaker 5: not that, because you can also have positive interpretation saying, okay,
[15:28] Speaker 5: those increase in the yields tell us that inflation is
[15:31] Speaker 5: a problem. It stays elevated, which you know FED admitted
[15:35] Speaker 5: it is in their statement and Governor Walsh said it
[15:38] Speaker 5: several times. But it is more of a disagreement, right,
[15:42] Speaker 5: There is more of a disagreement between the markets and
[15:46] Speaker 5: the FED, and also within the FED, which brings us
[15:48] Speaker 5: back to this good family fight. One important point here, though,
[15:55] Speaker 5: that is put and framed by markets and also within
[16:02] Speaker 5: today's development as a disagreement between the hulks and those
[16:07] Speaker 5: I wouldn't frame it like that because I think that
[16:11] Speaker 5: framing tells you inflation is elevated due to supply sharks,
[16:16] Speaker 5: but this is one off, so they will go away
[16:19] Speaker 5: on their own, so FED can look true. So all
[16:23] Speaker 5: we are disagreeing is about the timing, about the you know,
[16:27] Speaker 5: when they are going to disappear, and what is going
[16:31] Speaker 5: their impact going to be. I think this is not
[16:33] Speaker 5: the right framing. I think the right framing is the
[16:37] Speaker 5: real disagreement is about the model and how sharks propagate,
[16:41] Speaker 5: and that is the big unknown here.
[16:45] Speaker 1: And you can see that hurry in thirty years right
[16:50] Speaker 1: in terms of where they're sitting at. Does that tell
[16:53] Speaker 1: you how concerned markets are, particularly at the longer end,
[16:56] Speaker 1: worried about enduring inflation.
[17:00] Speaker 5: Yes, Market's clearly concerned about inflation. FED is concerned too.
[17:06] Speaker 5: It's just that markets are trying to make a sense
[17:09] Speaker 5: of this new FED. Right, so we heard a very
[17:15] Speaker 5: in a sense Hockey is fed, I mean in the talk, right,
[17:17] Speaker 5: so they admit disagreement. It is a nine three hold
[17:23] Speaker 5: the three descendants from regional FED presidents and you know,
[17:27] Speaker 5: so the market is trying to understand, Okay, everybody agrees
[17:32] Speaker 5: on inflation being a problem, but then why didn't you
[17:36] Speaker 5: hike today? That's where the market is, right, So market
[17:40] Speaker 5: is trying to make sense of the new FED. If
[17:43] Speaker 5: they are going to give us tough talk and they
[17:47] Speaker 5: do admit inflation is a problem, when are they going
[17:51] Speaker 5: to hike or if they are not going to hike,
[17:54] Speaker 5: how are they going to deal with this problem? So
[17:56] Speaker 5: market is trying to parse this out. Of course, the
[17:59] Speaker 5: first reaction, you know, should have been long term meals,
[18:04] Speaker 5: and that's what happens. So that's not surprising. But I
[18:06] Speaker 5: think we really have to watch what is going to
[18:09] Speaker 5: happen in the next few days in terms of how
[18:12] Speaker 5: market really try to parse this new FED. Information coming
[18:18] Speaker 5: from this new FED that really limits communication and also
[18:23] Speaker 5: drops forward guidance.
[18:25] Speaker 1: And as we speak, the backdrop is that even at
[18:28] Speaker 1: the moment we're hearing reports of renewed USS tracks against
[18:32] Speaker 1: the run, the straight up home mors remains closed. Other
[18:35] Speaker 1: key trading paths remain contentious as well. Across the Middle East,
[18:38] Speaker 1: President Trump is trying to rebuild his power for as well.
[18:41] Speaker 1: So if you take a look at those factors, I guess,
[18:44] Speaker 1: what does your research tell us about the enduring stickiness
[18:48] Speaker 1: of this type of inflation risk.
[18:52] Speaker 5: Indeed, this type of inflation is persistent, And that's the
[18:57] Speaker 5: overarching conclusion and headline result coming from our research. Because
[19:02] Speaker 5: our research is based on global networks. We try to
[19:06] Speaker 5: understand the propagation of supply shocks such as tariffs, such
[19:11] Speaker 5: as hormones, closure such as pandemics such as the energy
[19:15] Speaker 5: shock originally came from the Russian War. We are trying
[19:19] Speaker 5: to understand how these supply shocks travel through global production networks,
[19:24] Speaker 5: through input out put linkages, but also through global financial networks.
[19:28] Speaker 5: So that's I think something both markets and the FED
[19:34] Speaker 5: is missing right now because it's a macro view, but
[19:37] Speaker 5: it's a global macroview, right, not just a very nationalistic macroview.
[19:42] Speaker 5: And our research shows us that this type of inflation
[19:45] Speaker 5: is persistent under the assumption that FED looks true. So
[19:51] Speaker 5: I do agree with Governor worsh that inflation is a choice,
[19:55] Speaker 5: and FED is going to determine if these supply shocks
[19:59] Speaker 5: are going to be inflation, you know, or not at
[20:00] Speaker 5: the end. But unfortunately, if FED does look true and
[20:04] Speaker 5: treat these as level shocks, so one time increasing the
[20:08] Speaker 5: price level, this calls both for tariff and hormos, then
[20:13] Speaker 5: they are going to create persistent inflation even they disappear.
[20:17] Speaker 5: So even you know, we so entire Iran issue by tomorrow,
[20:21] Speaker 5: still there's going to be persistent inflation coming from that,
[20:25] Speaker 5: and permanently higher inflation coming from that. If again FED
[20:30] Speaker 5: looks through a tinking, this is just a one off shocks,
[20:33] Speaker 5: the tariff one we are now seeing it. Actually, the
[20:36] Speaker 5: current over four percent headline inflation over three percent core
[20:41] Speaker 5: inflation has a lot to do persistent of that inflation
[20:45] Speaker 5: has a lot to do with the terroiffs from last year.
[20:47] Speaker 2: That is anem Calumni Oskan, professor of International economics at
[20:52] Speaker 2: Brown University, speaking with Bloomberg TV host Heidi Stroud Watts,
[20:56] Speaker 2: bringing you their conversation here on the Daybreak Asia podcast.
[21:01] Speaker 2: Thanks for listening to today's episode of the Bloomberg Daybreak
[21:04] Speaker 2: Asia Edition podcast. Each weekday, we look at the story
[21:08] Speaker 2: shaping markets, finance, and geopolitics in the Asia Pacific. You
[21:12] Speaker 2: can find us on Apple, Spotify, the Bloomberg Podcast YouTube channel,
[21:16] Speaker 2: or anywhere else you listen. Join us again tomorrow for
[21:20] Speaker 2: insight on the market moves from Hong Kong to Singapore
[21:24] Speaker 2: and Australia. I'm Doug Chrisner, and this is Bloomberg

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