Interview: Apple chief executive
>> it’s 9:12 a.m. in sydney. expect a dry and sunny wednesday in that city. hot in the west. strong northeast winds. high temperatures, it’s 29 degrees celsius. as we mentioned earlier, news just coming in that microsoft chief financial officer john conners will retire. microsoft says conners will become a partner of a seattle-area venture capital firm. the company will consider internal and external candidates to fill the position. apple computer unveils its $500 mac into be computer, its cheapest ever. the company is also selling a new low-cost ipod music player. the shuffle will sell for under $100. the company says that makes it smaller, lighter and shock resistant. apple chief executive steve jobs unveiled it in san francisco.
>> this is the new ipod shuffle. take off the cap, put it right on, you’re set to go. [applause]
>> tomorrow, apple may report the ipod sales drove quarterly earnings to a four-year high. apple shares tripled last year. the european union and the u.s. agree to seek a settlement of government aid to airbus and boeing. the move is to prevent a 10-year-old dispute from becoming the biggest case in the history of world trade organization. the position heads off the immediate threat of a court case after the u.s. filed a complaint that the w.t.o. back in october. the u.s. argues european government loans to airbus were an am of legal subsidies under global trade rules. the e.u. countered, saying boeing has benefited from unfair support of $23 million from a military contract. the prospect of a lawsuit is threatening to undermine the way the two biggest plane makers finance the development of a new aircraft. analysts surveyed by bloomberg expect net income to rise 46%. infosys reports third quarter results this afternoon. indian investor production probably rose in november after the cheapest loans in 31 years spurred demand for homes and cars. economists surveyed by bloomberg expect factory output in asia’s number four economy gained 8.2%. it rose a record 10.1% in october, that was the same month india’s central bank kept its benchmark interest rate the lowest since 1973. european investors are watching chipmakers’ reactions to intel’s earnings as well as retailer’s results. bloomberg’s mark barton has a preview of wednesday’s agenda.
>> now wednesday, european chipmakers will be the center of attention, at least at the start of trading after the release of intel’s earnings. now metro may report that quarterly sales rose 6.3%, germany’s biggest retailer opened stores abroad, out pacing royal ahold and replacing the dutch company as the world’s third biggest retailer. germany’s economy shrank in 2003, proming metro to open cash and carry wholesale stores in countries, including china and media mart consumer electronic outlet elsewhere in europe. britain’s biggest consumer electronics retailer, dixons may say that u.k. sales grew 2.5% in the eight weeks through december. that would be less than half the pace of the previous 28 weeks. dixons, whose u.k. businesses include curry’s p.c. world and the link is having to cut prices to keep up competition with retailers such as pesco, britain’s number one food retailer and wal-mart stores. staying with retailer, burr berry group reports fourth quarter sales. the luxury retailer known for its trimmed raincoat may report an increase as it added products in open stores and cities in moscow and tokyo as well. turning to aerospace. and airbus will probably raise its 2005 production by 15% when it gives its annual outlook. the world’s biggest commercial aircraft maker would widen its 2-year-old lead over boeing. the company would also probably say 2004 sales rose marg untilly, even as deliveries rose 5% because of the weak dollar. the e.u. and the u.s. agreed to seek a settlement in regardses to airbus s.a.s. and boeing. in london, i’m mark barton.
>> the man who co-founded the quantum hedge fund with george soros is both bearish and bullish in china at the same time. jim rogers who now turns a $1.3 billion commodity fund says he plans to jump into china when others get scared away.
>> you’re probably going to see real estate investors in china go bankrupt, you’re probably going to see financial types in china go bankrupt in 2005. that is going to scare everybody. they’re going to cut back on their import. it is not in the world, it’s the buying opportunity. you see turmoil in china, you pick up the phone and buy all of china you can because it is a buying opportunity.
>> the yen rises the most against the dollar in almost a month. here’s a look at where the japanese currency is trading right now. a currency strategist at national australia bank talks about when the bank will step in to strengthen the rising yen.
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Listen Market briefing --- Cathy (fast)
Australia market --- David (slow)
Tokyo market --- Ron (slow)
>> welcome to “live” from hongcofpblg i’m catherine i can’t think. we have plenty in store for you on this edition including intel’s fourth quarter results. andy bryant will join us live from the company’s headquarters in silicon valley in less than two hours. plus, a fund manager who owns the stock will join us half an hour. he’ll tell us whether he’s planning to buy more or plans to sell. also coming up t dollar resumes its tumbling. we’ll tell you why and get a live reaction from a currency strategist in 20 minutes and donald evans heads to china to press u.s. trade concerns ahead of international affairs and the u.n. manufacturers group will tell us what he is looking for. intel reports that fourth quarter sales rose to a record as holiday shoppers bought laptops. net income fell as company trimmed production. net income fell to $2.12 billion or 33 cents a share. sales rose 9.8% to $9.6 billion, topping intel’s analyst expectations. the market was expecting sales of the world’s biggest chipmaker to rise 8% to $9.4 billion, according to analysts surveyed by thomson financial. analysts say intel’s figures are driven by laptop sales.
>> overall, the trend is towards laptops long-term. that’s where their real business is because of the migration of desk tops to lap tops around the world. asia is already there, europe is guessing there, the u.s. is getting there as well and that’s where the strength is coming from.
>> intel makes sentry know chips used in laptops. craig baret, the c.e.o., calls sentry know a wonderful success story. the chips have helped intel turn around a year when new product delays and record inventory could have hurt sales and profit. intel was the second worst performing stock on the dow jones industrial average last year, down 27%. we’ll be going live to intel’s headquarters in santa clara to talk to andy bryant, the company’s chief financial officer, that’s at 7:55 a.m. hong kong, 8:55 a.m. in tokyo and 6:55 p.m. new york time. and elsewhere in the semiconductor industry, we’ll be getting fourth quarter figures from the second biggest chipmaker in the world, samsung electronics on friday. we have breaking news for use on the bloomberg. microsoft says its chief financial officer john conners will retire. i’ll give you more details as soon as they’re available. but first, u.s. stocks fell before those intel figures were released, disappointing fourth quarter profits from big-name companies like advanced micro devices and alcoa caused investors to sell u.s. stocks. a bad start to fourth quarter earnings season caused the dow and s&p 500 to fall .6%. the nasdaq closed lower by .8%. a.m.d. suffered its biggest one-day drop since october 2002. the company says fourth quarter operating profits fell from the previous period because of its loss in the memory chip business. u.b.s. and piper jaffray and company have downgraded a.m.d. the fall in stocks fueled demand for bonds. the fed is expected to continue raising rates this year. according to economists surveyed by bloomberg, the fed funds target rate is expected to reach 3 1/2% by year-end. it currently stands at 2.25%. the dollar post its biggest loss against the yen in four weeks. comments from the european central bank’s chief economist triggered that decline. the dollar’s drop against the euro has already gone too far and the key to cutting u.s. record trade deficits lie in asia and especially in china. it send the dollar to a six-day low against the yen, almost wiping out all of its gains against the japanese currency so far this year. and the dollar posted a second consecutive loss against the euro for the first time this year. oil prices rose to their highest this year, once again cold weather is to blame. oil topped $46 a barrel in new york for the first time since mid december. it’s gained more than 10% over the past month. oil jumped in new york tuesday after a weather service said temperatures in the northeastern united states would fall below normal beginning thursday. that region consumes about 80% of the nation’s home heating oil. oil has also been rising this year, after opec made good its pledge to cut production in an effort to boost prices. australian stocks rise in new york trading with the bank of new york australia a.d.r. index gaining .6%. let’s go to david dweed for more on the australian market . good to have you with us, david. what are australian investors looking at this morning?
>> well, you’re right. the a.d.r. index did ride. we have the futures on the a.s.x. 200 indicating down about .4%. that might be just some catch up to yesterday’s trading and also it might be reflecting the decline in u.s. stocks that we saw overnight. that said, copper prices are up 2%. that could help some of our mining companies and it has come out with a report, they’re predicting that thermal coal, used in power generation, may rise 27% this year after gaining 41% last year. that could help some of the miners such as rio tinto. also we have january consumer confidences coming up. remember that in december, that fell from a 10-year high and a drop in confidences, if there was one, could support the contingent that the central bank may keep interest rates on hold longer than some people have been expecting and just remember, of course, tomorrow about the jobs report coming up. catherine?
>> and in terms of corporate news, what are investors looking at this morning?
>> well, we’ve got harvey norman’s first half sales coming up and just before―as i just came on now, i’m hearing that boardman, the third biggest iron ore producer in australia, has a takeover, 11.5% above the closing price of the company last week. there could be more action here because, of course, some of the chinese companies are―might also join the bidding because they might want to secure their iron ore supplies. cathy?
>> thanks for that, david. now china turns in a record monthly trade surplus as exports surge. overseas shipments jumped 23% in december, rising faster than 30% for the 30th consecutive month. that pushed exports to a record $63 billion last month. imports jump as well, but not as fast to close the gap, resulting in a $11 billion trade surplus for the month. china’s trade surplus with the u.s. top add record $131 billion last year, more than doubling the size of japan’s trade advantage over the u.s. the u.s. has been pressing china to strengthen its currency in an effort to close the trade gap. last month’s tsunami left hundreds of thousands of indonesians homeless. ron madison has a look at how that country is responding. good morning, ron.
>> good morning, cathy. indonesia now working to set up refugee camps for more than 600,000 people left homeless by last month’s tsunami. the united nations says indonesia is building 24 camps in banda aceh, the worst-hit area of the country. a spokeswoman says the aid agency is flying a 100-bed fuel hospital in the region. health officials say they are worried that water-borne especially dimics such as cholera and malaria will increase the death toll. the last four britains held without charge in guantanamo bay in cuba are going to return home. u.k. foreign secretary jack straw says they will face questioning upon arrival.
>> the four men will be returned in the next few weeks. once they are back in the united kingdom, the police will consider whether to arrest them for questioning in connection with possible terrorist activity. any subsequent action will be a matter for the police and the crime prosecution service.
>> the u.s. held the four men for almost three years at the military detention center. the government set up the camp to detain suspected terrorists captured in afghanistan. the secretary of homeland security says president george w. bush’s inauguration will be held under unprecedented security. tom ridge says security will be the highest ever for a presidential swearing in ceremony. bush does retake the oath of office next thursday. it is the first inauguration since the september 11 attacks. more than 6,000 law enforcement officers and 2500 soldiers are going to be deployed for the event. cathy, that is the latest look at world news. back to you.
>> thank you for that, ron. after the break, u.s. stocks extend the january decline after disappointing earnings from advanced micro and alcoa. our roars from the new york stock exchange will wrap up the day’s trading. you’re watching “live.”
