Tech Rout Sends Markets Lower; SpaceX, Google Strike Cloud Deal, More
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What is the main topic discussed in this episode?
The Bloomberg This Weekend Podcast. News, politics, and the lighter side of Bloomberg.
The great wealth transfer includes $570 billion in classic cars.
I'm not in a position to be inheriting any classic cars. You?
No, but my brother did inherit my non-classic car when I moved to New York, so. Ew.
He still has not paid me for it. Coming for you, Joey.
The Bloomberg This Weekend Podcast. Subscribe today on Apple, Spotify, or wherever you listen. News when you want it with Bloomberg News Now. I'm Amy Morris. Stocks ended the day in the red as a strong jobs report and a tech route sent prices tumbling across the board. Let's bring you those closing numbers. The tech sell-off hit NASDAQ down more than 4% or 1,122 points. S&P down 2.6%, that's about 201 points. The Dow lost 695 points, that's about 1.3%. The Russell 2000 Index lost 102 points, or nearly 3.5%. Bitcoin down more than 4%, right at $60,000. Now, Bitcoin had dipped to less than $60,000 earlier today. It's the first time that's happened since October of 2024. Even oil is lower now. WTI down nearly 3%, near $90 a barrel.
Brent crude down more than 2%, near $93 a barrel. We're going to have a lot more on the tech sell-off and the jobs numbers just ahead. But first, this just crossing the Bloomberg terminal. Goldman Sachs CEO David Solomon has asked that bank's general counsel, Kathy Remler, to stay at the firm. You may recall Remler resigned from her role earlier this year over her interactions with Jeffrey Epstein. Well, Solomon has privately maintained that he doesn't believe Remler did anything inappropriate and he wants her to stay on as an advisor. OK, back to the markets now, starting with that big upside surprise for the labor market, which had traders fully pricing in a rate hike by the end of this year, sending markets lower.
And Goldman Sachs partner John Flood says that makes sense.
People now think that we will get a rate hike by year end. So I think it's healthy.
What caused the recent tech sell-off in the markets?
I do think it's a buying opportunity. And I think that there is still a significant amount of worry, cash on the sidelines, short exposure out there for the market to climb higher.
Hear more from Goldman Sachs partner John Flood on our Bloomberg Talks podcast. That May non-farm payrolls report shows 172,000 new jobs added in the month. That's twice what economists surveyed by Bloomberg expected. And the unemployment rate held steady at 4.3 percent. National Economic Council Director Kevin Hassett argues the big supply side boom can avert runaway inflation.
Look at the impact of oil price shocks on core inflation. And the history of it is that they're temporary. They don't lead to lasting inflation that people see through it. My advice to the Fed is watch the numbers, because what you're going to see is that with a big supply side boom, that you could have high growth without having runaway inflation. It's not a Phillips curve event at all.
Hear more from National Economic Council Director Kevin Hassett on the Bloomberg Talks podcast. Now, as for the tech sell-off, Bloomberg Television Markets correspondent Nora Melinda says this crackdown on the tech sector is coming just a week ahead of the SpaceX IPO, which is expected to be the biggest IPO in history.
There is a question as to whether or not what the appetite would look like, especially because SpaceX is not the only IPO that we have upcoming or expected from some of these names in the tech space.
Bloomberg's Nora Melinda tells Balance of Power there are some green shoots in the market, including consumer staples in health care. Sources tell Bloomberg the SpaceX IPO has drawn more orders than there are shares available. Underwriters on SpaceX's initial public offering have been told not to accept orders from investors in Hong Kong and China because of U.S. restrictions around the export of critical technology. The deal is expected to price June 11th and begin trading the following day with SpaceX set to deliver the biggest ever IPO. SpaceX and Google have entered a cloud service agreement. through which Google has agreed to pay SpaceX $920 million every month from October 2026 to June of 2029.
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