BBCNEWS — Business Today
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[00:00:01] MUSIC
[00:00:03] Live from Singapore now on BBC News,
[00:00:06] News, Business Today. The world's
[00:00:14] world's largest cryptocurrency exchange exchange reopens after a massive
[00:00:18] massive cyber attack as Binance users
[00:00:21] users withdraw $3.6 billion worth worth of digital assets and strong
[00:00:25] strong US demand lifts Starbucks
[00:00:27] Starbucks sales despite falling short
[00:00:30] short on 2027 forecasts. Hello and
[00:00:37] and welcome to Business Today. I'm I'm Vandhna Bhan Binance, the world's
[00:00:41] world's largest cryptocurrency exchange, exchange, reopened on Sunday after
[00:00:44] after a record hack last week, with with users rushing to withdraw their
[00:00:48] their digital assets from the platform. platform. The firm had suspended
[00:00:52] suspended all transactions in the
[00:00:53] the wake of the incident, which impacted
[00:00:57] impacted $6.3 billion worth of digital digital assets. Major organisations
[00:01:00] organisations including the FBI, FBI, have accused North Korea of
[00:01:04] of being responsible for the cyber cyber attack, which is said to be
[00:01:07] be the largest hack in history. Our Our Asia business reporter Archana
[00:01:11] Archana Shukla explains just how how damaging this hack has been for
[00:01:15] for Binance. Well, it did test the
[00:01:18] the confidence of the crypto industry. industry. It was the largest hack
[00:01:21] hack in the history at $6.3 billion
[00:01:24] billion moved. And you know, it is
[00:01:26] is somewhere reflective in the withdrawals withdrawals that happened right after
[00:01:30] after the exchanges resumed trading
[00:01:32] trading $3.6 billion of net outflow
[00:01:35] outflow when on Sunday in phases
[00:01:38] phases Binance reopened withdrawals withdrawals and deposits. And that
[00:01:41] that somewhere shows the concern concern that the customers have.
[00:01:44] have. You know, it is the largest
[00:01:46] largest crypto exchange. And if a
[00:01:48] a hack of this nature can happen, happen, there is anybody's money
[00:01:52] money safe. It has also heightened heightened some amount of concern
[00:01:55] concern on the use of artificial artificial intelligence for such
[00:01:58] such attacks. You know, while you
[00:02:01] you know, Binance quickly got its
[00:02:04] its hand around this hack, this incident
[00:02:06] incident and they moved very swiftly swiftly to assure investors that
[00:02:09] that they would be bearing all the
[00:02:11] the losses and the money would be
[00:02:14] be safe within the crypto exchange. exchange. But it does damage some
[00:02:17] some bit of confidence in the industry.
[00:02:20] industry. For now, 95% of the assets
[00:02:23] assets have been restored, Binance Binance has said, and that the remaining
[00:02:26] remaining ones that they are still still figuring out how to bring that
[00:02:30] that back. It also raises questions
[00:02:32] questions on how did a hack of this this nature manage, you know, was
[00:02:36] was managed on such a big crypto crypto exchange because it started
[00:02:40] started with a very ordinary engineers engineers laptop. However, later
[00:02:43] later Binance said that possibly
[00:02:45] possibly it was a more complex attack attack where, you know, the attackers
[00:02:49] attackers actually used softwares
[00:02:51] softwares to hide some of the digital digital some of their digital tracks,
[00:02:54] tracks, which made it a bit difficult
[00:02:56] difficult to trace how this was done.
[00:02:59] done. But it for now, about 90% of
[00:03:01] of the assets are back. The crypto
[00:03:03] crypto exchange is back into trading
[00:03:05] trading with withdrawals and deposits deposits and Binance says it would
[00:03:09] would be covering all the losses. losses. Now following on from that
[00:03:13] that cyber hack, Bitcoin payment payment software BTC Pay has warning
[00:03:17] warning operators to shut down their their systems after reports that
[00:03:21] that hackers have been draining funds funds from online wallets. This latest
[00:03:24] latest attack adds fresh concerns
[00:03:26] concerns about security across the
[00:03:28] the cryptocurrency industry. Btcpay Btcpay says it's investigating the
[00:03:32] the attacks and has not yet revealed revealed how many users may have
[00:03:35] have been affected or how much money
[00:03:38] money has been lost. Thousands of
[00:03:40] of Virgin Media O2 staff face redundancy
[00:03:43] redundancy risk as the telecoms firm firm looks to save money in the face
[00:03:46] face of billions of pounds of debt debt and tougher competition. The
[00:03:50] The broadband provider has not finalised finalised the number of roles to
[00:03:54] to be cut, but it is likely a sizeable
[00:03:57] sizeable chunk of its 16,000 workforce. workforce. The BBC understands. Virgin
[00:04:01] Virgin Media O2 has billions of debt
[00:04:03] debt on its balance sheet and is is tackling competition from both
[00:04:06] both smaller providers, as well as
[00:04:09] as giants like BT, which has agreed
[00:04:11] agreed a deal to acquire rival TalkTalk,
[00:04:13] TalkTalk, a move which Virgin Media
[00:04:15] Media O2 has firmly opposed. Now
[00:04:18] Now Starbucks reported stronger than than expected comparable sales in
[00:04:22] in its most recent quarter and said
[00:04:24] said it would resume share buybacks buybacks as its turnaround plan to
[00:04:27] to improve the coffee chains performance
[00:04:29] performance reached its two year year anniversary. However, the coffee
[00:04:33] coffee chains latest quarterly revenue
[00:04:35] revenue figures and outlook for 2027
[00:04:38] 2027 fell short of forecasts as international
[00:04:40] international sales continue to trail
[00:04:43] trail domestic US sales. So what what kind of strategy has Starbucks
[00:04:46] Starbucks used to achieve domestic domestic success in the US? I put
[00:04:49] put that to Hitha Herzog executive
[00:04:52] executive director of research at at Parsons Gromek Institute. They
[00:04:56] They really had a massive turnaround turnaround in terms of operations.
[00:05:00] operations. So new CEO came in cut cut and slashed a lot of the stores,
[00:05:03] stores, which is sad for some of of the communities that are now missing
[00:05:07] missing a Starbucks. However, a real
[00:05:10] real focus on staffing and really really doubling down on a smaller
[00:05:13] smaller menu with more hero products products such as these, you know,
[00:05:17] know, drink mixers that my kids tend
[00:05:18] tend to love. This is what is really
[00:05:21] really driving the traffic into the
[00:05:23] the stores. Now Global Comp was up
[00:05:27] up significantly around 6.2%. Revenues Revenues were up about 2%. However,
[00:05:30] However, when you parse that out
[00:05:32] out and you look specifically at
[00:05:35] at China, the guidance fell to about
[00:05:39] about 1% versus 1.4%. And North America America is also slowing down. So
[00:05:42] So that is something we have to look look at when they start talking about
[00:05:46] about guidance. That's when we have
[00:05:48] have to, as investors become more more aware. What are you hoping to
[00:05:52] to see then from Starbucks in the the years ahead, especially in terms
[00:05:56] terms of how to bump up those sales
[00:05:59] sales in international audiences audiences like China? You know, selfishly,
[00:06:03] selfishly, I would like them to add add more stores because we're missing
[00:06:06] missing our Starbucks. However, when
[00:06:08] when it comes to international, they
[00:06:11] they really need to take almost the
[00:06:13] the same sort of operational guidance guidance that they applied to here
[00:06:16] here in North America and double double down on the hero drinks. That
[00:06:20] That is what is bringing in the store store traffic, especially with the
[00:06:24] the younger generations. When you you have these drinks that are going
[00:06:27] going viral on social media, kids
[00:06:30] kids want to come in. That's what's what's bringing that traffic in.
[00:06:32] in. And they remodelled a lot of of the stores. So it feels a lot
[00:06:36] lot different within the stores as as well. Look, we're also going into
[00:06:39] into silly Season Christmas. That's That's a hit time of the year for
[00:06:43] for Starbucks isn't it? I mean apart
[00:06:46] apart from the drinks they also have
[00:06:48] have products. And you see lines lines out the door for these mugs
[00:06:52] mugs that they sell or certain drink drink vessels that people put their
[00:06:55] their drinks in. It is really hitting
[00:06:58] hitting a mark. And I think again,
[00:07:00] again, it's because of that pared pared down focus on what is going
[00:07:04] going to sell and what is not. Instead Instead of having a huge skew mix,
[00:07:07] mix, they really just focus on very very specific product that is resonating
[00:07:11] resonating with the customers. And And if they can do that internationally, internationally, it'll be better
[00:07:14] better for them. You'll see a lot
[00:07:15] lot more results going into the next next couple quarters, certainly,
[00:07:19] certainly, and into the next couple couple of years. Now finally, it's
[00:07:22] it's a big week ahead for Wall Street
[00:07:25] Street with the US midterms on Tuesday, Tuesday, the Democrats expected to
[00:07:28] to take control of the House of Representatives,
[00:07:31] Representatives, while Senate control control remains uncertain. We've
[00:07:33] We've also got a couple of earnings earnings on deck with tech giant
[00:07:37] giant Apple reporting on Monday and
[00:07:39] and McDonald's later in the week. week. Investors continue to await
[00:07:43] await October's job reports out of
[00:07:45] of the US, which is scheduled for for release on Friday. Well, let's
[00:07:48] let's get analysis on all of these these with June Ballou, who is co-founder
[00:07:52] co-founder and lead portfolio manager manager at Tin Cap. Great to be able
[00:07:55] able to speak with you. June, I just just want to start off on tech and
[00:07:58] and last week we saw a huge tech
[00:08:01] tech sell off and we're going into
[00:08:03] into this week are earnings from from Apple there. What will markets
[00:08:06] markets be looking for this week.
[00:08:08] week. Yeah look the market certainly
[00:08:11] certainly is going to wanting to to see strength across the consumer
[00:08:14] consumer products especially with
[00:08:17] with the indication of for sale of
[00:08:19] of the new iPhone in particular and and commentary of where that's going.
[00:08:23] going. Now of course market would
[00:08:25] would like to see you know, in terms terms of the its investment spend.
[00:08:29] spend. You remember, one of the biggest biggest problem with a lot of hyperscaler
[00:08:32] hyperscaler in the over the next next 12 months is actually about about how much money you're going
[00:08:35] going to spend as a lot of free cash cash flow moving into negative. So
[00:08:39] So but with Apple, it's less of a a problem, but still is going to
[00:08:42] to be one of the focus. But I think think the iPhone indication of how
[00:08:46] how that's leading is going to be be very important. We're hearing
[00:08:49] hearing you know, reports about there's there's a lot of outages. You know,
[00:08:52] know, many of the new iPhone won't won't be delivered until early next next year. It might create a bit
[00:08:56] bit of issue for investors forecasts. forecasts. Now talking about the
[00:09:00] the US jobs report, which is also also coming out this week, what are
[00:09:03] are we expecting to see there and and what it signals in regards to
[00:09:07] to the health of the US economy. economy. Yeah sure. Look we're still
[00:09:10] still expecting pretty good results results actually on that front. I
[00:09:13] I think from everything we've read, read, at the moment is health of
[00:09:16] of the US economy is very strong strong and particularly from what
[00:09:19] what we're hearing from the companies companies during this reporting season
[00:09:22] season as well in the last few weeks weeks that they are reporting pretty
[00:09:25] pretty good numbers. And then the the pricing power of the corporates
[00:09:29] corporates have been pretty strong. strong. So, you know, consumers pretty pretty much putting up with it. So,
[00:09:32] So, you know, so it does look like, like, you know, I think the jobs
[00:09:35] jobs report will continue to be very very strong. And what that means
[00:09:38] means for the fed narrative is that that there will be interest rate
[00:09:41] rate increase. And, you know, and
[00:09:44] and we await their further guidance guidance and how many I guess is
[00:09:48] is the bigger question here. Look, Look, all of this comes as of course
[00:09:51] course we are heading into the midterm midterm elections Tuesday night in
[00:09:55] in the US. This political uncertainty. uncertainty. How are markets weighing
[00:09:58] weighing that up and how could things things change post the midterm, say
[00:10:01] say by the end of the week, even?
[00:10:03] even? Yeah, sure. Like there's a a there's a bit of anticipation into
[00:10:07] into it because normally share market, market, equity market doesn't move
[00:10:10] move a lot before and after midterm midterm because the policies and
[00:10:14] and you know, the tax and the and
[00:10:17] and spending and there's a lot of of policies can change and move the the market. And usually you see a
[00:10:21] a bit of rally after the market after after the midterm bit of relief rally
[00:10:24] rally into December. Now this year, year, the you know, because the changes
[00:10:28] changes are less clear and it doesn't, doesn't, you know, it's based on
[00:10:32] on some of the policy that could could potentially move the market
[00:10:34] market and sectors is really not not that much. So we do think there's
[00:10:38] there's a if anything, you know, know, there's potentially for Trump
[00:10:41] Trump to increase the government
[00:10:43] government spending somewhat. And
[00:10:45] And you know, positive support maybe maybe for the healthcare sector given
[00:10:48] given he has cut a lot of healthcare healthcare spending in the last 12,
[00:10:52] 12, 12, 18 months. But aside from from that, there's really not that
[00:10:55] that much is going to be market moving. moving. June really appreciate getting
[00:10:58] getting your analysis there. Jim Jim Bailey, co-founder and lead portfolio
[00:11:01] portfolio manager at ten cap. That's That's it from us here in Singapore.
[00:11:04] Singapore. See you tomorrow. MUSIC
[00:14:32] The BBC was always on in the Moshiri house and my dream actually
[00:14:36] actually was to be a BBC News presenter.
[00:14:39] presenter. I want to be for others others what the BBC was for us a
[00:14:42] a trusted source of stability and
[00:14:45] and hope. For me, trust is about
[00:14:48] about presence, about fostering relationships relationships all around the world
[00:14:51] world over years. So when a story story breaks, we're not chasing a
[00:14:55] a lead. We're already there.
[00:14:57] I'm Maryam Moshiri on the World Today
[00:15:02] Today for BBC News. On BBC News.
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