Return to Transcripts main page
First Move with Julia Chatterley
Drones Strike Business Center in Moscow; Pro-Coup Protesters Descend upon French Embassy; Four Dead, Dozens Rescued after Boat Capsized in 2022; Hooper: Investors may see Disappointment in Near Term; How Sustainable Aviation Fuel helps Airlines Go Green; Japan Stun Spain with Four Goals. Aired 9-10a ET
Aired July 31, 2023 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:00]
JULIA CHATTERLEY, CNN HOST, FIRST MOVE: A warm welcome to all our First Movers around the globe. It's Monday and the end of July is nice. I spy a
summer flying by a busy week lies ahead you cannot deny as Wall Street bets July goodbye July, J is the Job Supply.
Wall Street to gearing up for important employment data that will help plot the Feds policy course over into the fall a soft economic landing ahead and
all more policy from the Fed turbulence dread. We'll discuss with Christina Hooper of Invesco. In the meantime, U is that Uber Profits earnings from
the car hailing app.
And other tech giants like Apple and Amazon are all on tap this week some 80 percent of companies beating modest let's be clear expectations, this
earnings season and in turn trouncing concerns of a corporate profit recession. L is for Logo Lost the Twitter bird disappeared from social
media giant X is app X marketing spot to a top its headquarters in San Francisco.
So no bird is the word that is the X really preferred and Y is for Yuan Deterred the Chinese currency under pressure as manufacturing data
disappointed once again. That's actually the fourth straight month of manufacturing weakness and will no doubt feel calls for more stimuli
spending from Beijing.
Or this is severe weather bears down on the Chinese capital to a powerful typhoon with another powerful storm on its way, a full report on that just
ahead. In the meantime, how a stock markets reacting well? Chinese stocks beginning the week with gains stimulus hopes abound, but the latest Chinese
Beige Book showing consumers cutting back spending on everything but restaurants and travel.
In the meantime, Japan the big gainer up more than 1 percent as you can see with the more inclusive topics index hitting 33 year highs. We'll be
discussing that too. In the meantime, U.S. stocks set for a higher open after three straight weeks of gains and Europe too in the green amid
encouraging data there Eurozone growth data positive once again, and inflation easing to 5.3 percent year over year.
For context prices were up over 9 percent this time last year, so certainly cooling there too. I'd like to get to as always this hour, but we do begin
with the latest from Ukraine. And let me give you the latest from Ukraine, where President Zelenskyy's hometown was struck by Russian missiles at
least four people have lost their lives in the attack and over 40 others were injured meanwhile, this.
It was a drone attack on Moscow a business center in the Russian capital was damaged on Sunday. Nick Paton Walsh joins us now. Nick, let's start in
Ukraine and that attack on Kryvyi Rih. I believe one of those buildings contained school.
NICK PATON WALSH, CNN CHIEF INTERNATIONAL SECURITY CORRESPONDENT: Yes, I mean, at this point, it's startling really to see the number of injured
involved over 50 and four dead, including a 45 year old woman and her 10 year old daughter and two men as well. Now one of the witnesses -- from her
apartment block near where one of these missiles landed described how her husband was knocked off her feet and how a child was basically safe because
they were in the bathroom.
And indeed another missile landing near a polytechnic for economic and technological studies where another witness described how there was nobody
in the building with a missile landed but they simply didn't have time even to respond. This startling frankly, because it appears to be an escalation
by Russia to hit civilian areas Kryvyi Rih is said Volodymyr Zelenskyy the President Ukraine's hometown.
A vast, sprawling industrial town quite far at this point since the frontlines have changed away from the fighting but clearly a place that
Russia today wanted to inflict damage upon. Now it's important to point out now when we talk about Ukrainian it seems Ukrainian drone attacks on areas
like you showed the video there Moscow city in the Russian capital.
That pales into insignificance compared to the daily damage being done to Ukraine by often indiscriminate, blatantly vicious Russian missile strikes.
But the images that emerged from Moscow city and upscale glass towered financial district a sign really of the opulence that Russia has tried to
maintain on the global stage over the past decades that being hit by Ukrainian drones.
[09:05:00]
That frankly a year ago you wouldn't even -- could possibly get through Russian air defenses. That is indeed a deep psychological blown one I'm
sure that the Kremlin feel they have to respond to in some way despite the fact strangely today, their spokesperson Dmitry Peskov calling those drones
attacks and act of desperation.
But we are here in the south Zaporizhzhia where Ukraine continues to push forward. In its counter offensive, some slow and at times reversed
progress, particularly to the east of these front lines. But the tempo of this war certainly rising at this moment as Russia feels itself
potentially, it is motherland more under attack.
Vladimir Zelenskyy said yesterday that the war is gradually returning to Russia. But it is quite clear that we will continue to see this blatant bid
by Russia to impact a civilian toll on Ukraine regardless of how they're faring on the battlefield here, Julia.
CHATTERLEY: Nick, good to have you thank you, Nick Paton Walsh there. Now a powerful explosion in Pakistan, a suspected suicide bomber taking dozens of
lives at a political rally and wounding more than 100 others. No one has claimed responsibility for the attack. Ivan Watson has more.
(BEGIN VIDEOTAPE)
IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT (on camera): There was an evening of death and carnage in a small Pakistani town not far from the
border with Afghanistan. On Sunday, Pakistani police say a suicide bomber detonated eight to 10 kilograms of explosives near the stage of a political
party gathering.
At least 54 people were killed 12 of those victims under the age of 12 and many more wounded. The Gathering involved a right wing Islamist political
party that goes under the acronym JUIF. It is part of the governing coalition in the national government. Up until now there has not been a
formal claim of responsibility. Here's what one man had to say who arrived on the scene of this deadly blast shortly after it took place.
UNIDENTIFIED MALE: I was in close proximity when the blast occurred. Upon arriving at the scene I was confronted with a devastating sight lifeless
body scattered on the ground while people cried out for assistance amidst the bloodstains surrounding people were picking up bodies on their own.
Around 4 to 500 individuals had gathered here to attend the convention, organized by the JUIF party.
WATSON (voice over): That deadly act of political violence tragically, they do take place in Pakistan. And there's a whole range of different
organizations and ideologies that have been affiliated with this kind of violence in the past.
WATSON (on camera): For example, in January of this year, there was a suicide blast that targeted a mosque in a police compound in the Western
City of Peshawar. Scores of people killed and that was claimed initially by the Pakistani Taliban which then denied responsibility for the attack. One
of the deadliest suicide bombs in modern Pakistani history was back in 2018. It targeted another political party in Baluchistan province, and the
Pakistani branch of ISIS claimed responsibility for that terrible attack.
The Pakistani Prime Minister has denounced this act of violence and expressed his regrets. And there are concerns that there could be more
violence on the horizon, as Pakistan is expected to hold national elections this -- . Ivan Watson, CNN, Hong Kong.
(END VIDEOTAPE)
CHATTERLEY: The President of Chad is in Niger meeting with both coup leaders and the elected President Mohamed Bazoum in an effort to facilitate
a police full solution to the crisis there. It comes after thousands of protesters took to the streets on Sunday in support of the coup tense.
And sometimes violent scenes played out in front of the French Embassy as protesters shouted their support for Russian President Vladimir Putin.
Others condemned France's influence in the country and burned French flags. Larry Madowo joins us now.
This meeting with the President of Chad and coup leaders particularly comes after a warning from leaders of Western African nations saying look give up
or face potential military action. The question is what can he achieve?
LARRY MADOWO, CNN CORRESPONDENT: He can try and talk to these coup leaders to you know, go back to the barracks. It's unlikely they will heed because
France is now responding to claims from the coup leaders that France is planning military strikes in Niger to free the U.S. the President Mohamed
Bazoum.
The Military Junta claimed that on stage television that France has been holding meetings with the Former, the Director of the Head of the
Presidential Guard, as well as actually that's not correct.
[09:10:00]
They claim for the Military Junta here, is that the Foreign Minister acting as the Head of government as well as the Head of the National Guard have
held meetings with Paris and that they have authorized France to carry out military strikes in this year to free the author, President Bazoum.
We've had now this response from a spokesperson for the French now telling CNN that France recalls that it recognizes President Mohamed Bazoum and the
democratically elected institutions as the only legitimate authorities in Niger. Our priority is the safety of our nationals and our holdings, which
must not be the object of violence in accordance with international law.
So it's a denial that not explicitly saying that not planning these strikes, but they're not saying they're not planning either. But that's not
likely to go down well, with the thousands of people that marched in the streets of Miami on Sunday against French influence against France, a
freak, I guess echoes the regional body and against any international meddling.
(BEGIN VIDEOTAPE)
MADOWO (voice over): Angry Nigerian smashing windows of the French Embassy in the capital in the Niamey. Thousands of people outraged at the country's
Former Colonial Power, a day after its suspended aid and financial support for Niger with immediate effect.
Down with France, some said condemning French support for Ousted President Mohammed Bazoum. Unable to get into the heavily protected compound, a
window is set on fire, and a French flag trashed a common sight since Wednesday's military coup. Security forces eventually deployed tear gas to
disperse the protesters.
France warned it would retaliate immediately and in a strict manner, in case of any attacks against its embassy, national army, and our diplomats.
The Elysee Palace, saying on Sunday, adding the President Emmanuel Macron will not tolerate any attack against France and its interests.
The Military Junta that ousted the West African countries democratically elected President, keen to show France and the world that it has the
backing of the public.
MAMAN SANI, PROTESTER: We also came out to tell this little Macron from France that Niger belongs to us. It's up to us to do what we want with
Niger what we want. We deal with who we want, and how we want. We are for me support for Niamey.
MADOWO (voice over): A sea of people outside Niger's Parliament denouncing France and some is raising Russian flags. Long live Putin and Long live
Russia. The protesters say demanding that foreign armies leave the country. France has about 1500 troops in Niger, a key ally in the fight against
terrorism in the Sahel. The U.S. has about 1000 troops in the country involved in counterterrorism operations.
IBRAHIM, RETAILER: As citizens of Niger, we are against French bases, American bases, Canadian bases, Italian bases. All the bases that are in
Niger, we don't need them.
MADOWO (voice over): The Head of the Presidential Guard General Abdul Hamid Khan deposed his boss and declared himself Niger's new leader on Friday,
saying he will suspend the Constitution and rule with the so called National Council for the safeguard of the homeland.
ZEINABOU BOUKARI, PROTESTER: They're really brave and I support them. 100 percent we've really suffered a lot. We've suffered a lot because they are
our children. A lot of blood has been shed in Niger. We want peace, we want peace.
MADOWO (voice over): In neighboring Nigeria and emergency summit of the Economic Community of West African States ECOWAS, regional leaders
announcing sanctions including closing borders, a travel ban, a no fly zone, freezing assets, and the deadline. ECOWAS has given the Niger Junta
one week to reinstate President Bazoum or threatened to take all measures to restore his government.
OMAR ALIEU TOURAY, ECOWAS COMMISSION PRESIDENT: Such measures may include the use of force. To this effect, the chiefs of defense, stuff of ECOWAS,
are to meet immediately.
MADOWO (voice over): But many protesters on the streets don't want any ECOWAS military intervention or involvement. And the Military Junta says
it's ready.
COLONEL-MAJOR AMADOU ABRAMANE, NIGER MILITARY JUNTA: We once again remind ECOWAS and those who wish to adventure in this of our firm determination to
defend our country.
(END VIDEOTAPE)
MADOWO: As strong threat from ECOWAS, the regional body and fighting words from the military. That's what the mediator comes in that man is Mahamat
Idriss Deby, it know, he is the President, Transitional President of neighboring Chad, and he's been in Niamey meeting with the President
Mohamed Bazoum.
The first time we've seen him in public, as well as with the General Abdourahamane Tiani, the man who deposed his boss. He was the Head of the
Presidential Guard and now claims he's the leader. And President Deby said they had in depth discussions about how to find a peaceful resolution to
this crisis. Though he didn't say what progress was made out of that?
[09:15:00]
All he says is that they talked in a fraternal approach which instructs all avenues so not quite the white smoke that the region is waiting for
especially because the school leaders are emboldened by the fact that Julia they appear to have public support despite what the region and the world is
telling them that they feel that the people of Niger as are with them.
CHATTERLEY: Yes, it's such a great point and you understand the nervousness and concern about potential spillover effects when you see protests and
particularly comments like that. Great report Larry, thank you for that. Turning now, to frightening scenes from Beijing and other parts of
northeast China as extreme summertime weather that is the region at least four people have died.
Thousands evacuated is one of the strongest typhoons in some 17 years, triggers major flooding in many cities. The storm also caused damage in the
Philippines and in Taiwan. Forecaster warning another powerful storm is also on the way. Laila Harrak reports on the daring rescue and the
devastating damage in China.
(BEGIN VIDEOTAPE)
LAILA HARRAK, CNN CORRESPONDENT (voice over): Rescuers in speed boats zoom across the water in southeastern China. It's the best and a times only way
to access cities flooded by recent heavy rains. The boats navigating the tight streets at times floating up to the front doors of homes to ferry
stranded residents to safer ground.
Officials say over the weekend more than 500,000 people have been evacuated from the region, where a powerful storm named Doksuri made landfall as a
typhoon Friday after a battering the Philippines. It's since been downgraded. But officials are warning of torrential rain and hazardous
flooding for any city in his path.
And that includes Beijing, which has been doused with heavy showers that are expected to continue until Tuesday. Authorities have urged residents in
the Chinese capital to stay indoors, and thousands of people have already been evacuated from areas with flood risks.
Authorities say there could be potentially hazardous conditions like those seen in other parts of the country. In Eastern China security camera
footage captured a man caught in rushing waters on a street. A bus driver stopped to help him as the breeze surrounds them. But the man is eventually
dragged out of the water with the help of some people passing by.
In the southern part of the country, some residents are taking stock of the damage and trying to salvage what they can from their waterlogged homes.
But that break may not last for long as another powerful storm could possibly make landfall in China later this week. Laila Harrak CNN.
(END VIDEOTAPE)
CHATTERLEY: To Miami now and the property manager who allegedly said the boss wanted surveillance video deleted at Donald Trump's Mar-a-Lago resort
will appear in court later today to face four criminal charges. It comes as the front runner for the Republican presidential nomination continues to
protest his innocence. Randi Kaye has the story.
(BEGIN VIDEOTAPE)
RANDI KAYE, CNN CORRESPONDENT (voice over): Donald Trump's slamming the special prosecutor's team.
DONALD TRUMP, 45TH U.S. PRESIDENT: She's a crooked people.
KAYE (voice over): As he learns of new legal threats he and his employees may face newly named co-defendant Mar-a-Lago Property Manager Carlos de
Oliveira is set to be arraigned today in Miami.
A superseding indictment alleges he along with Trump aide Walt Nauta attempted to delete security camera footage at the club after the Justice
Department issued a subpoena for it. According to the indictment, De Oliveira told one of the resorts IT workers the boss wanted the server
deleted.
CNN has now learned that it worker Yuscil Tavares has received a target letter from federal prosecutors. Tavares reportedly met with investigators
after Trump's first indictment in June. It's unclear if he's co-operating with the investigation. But sources say some of the new allegations against
Trump were based at least in part on information Tavares provided.
Trump facing additional charges for mishandling classified documents, maintained his innocence on social media, claiming his legal team
voluntarily handed over the tapes to the Special Counsel and that he never told anybody to delete them. De Oliveira separately charged with lying to
the FBI about moving boxes of classified documents from Trump's residence to a storage room.
CHRIS CHRISTIE, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: This is bad stuff and you know, you can't say there was no underlying potential crime here.
KAYE (voice over): The superseding indictment giving Trump's opponents an opportunity to go after the front runner.
CHRISTIE: It's pretty brazen these guys were acting like the Corleones with no experience.
KAYE (voice over): Other candidates treading more cautiously over the indictment, as Trump remains popular with the GOP base.
NIKKI HALEY, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: None of us want to be talking about indictment and I don't even know if it's the third, fourth or
fifth indictment right now but what I can tell you is it's a distraction.
[09:20:00]
KAYE (voice over): Most use the issue to steer the conversation to the future.
VIVEK RAMASWAMY, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: One of the right ways to do that is to pardon the Former President of United States from
what is clearly a politicized prosecution.
KAYE (voice over): Even Trump's top rival, Florida Governor Ron DeSantis, weary of engaging.
RON DESANTIS, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: I want to spend less time litigating that, because that's really looking in the past and more
time focusing on the future in terms of what we need to accomplish as a country.
KAYE (voice over): At a GOP party dinner in Iowa, direct criticism of Trump drew a rebuke from the audience.
WILL HURD, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: Donald Trump is running to stay out of prison. And if we elect I know, listen, I know the truth.
The truth is hard.
KAYE (voice over): Closing out the dinner, Trump steered clear of the new charges against him.
TRUMP: If I weren't running, I would have nobody coming after me.
(END VIDEOTAPE)
CHATTERLEY: OK, coming up on FIRST MOVE migrant monitoring, we explore new AI surveillance tech being used in the English Channel. Stay with us, more
coming up.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to FIRST MOVE, in the United Kingdom The government is ramping up measures to deter migrants crossing the Channel
from France. And a controversial new law has been passed that will include criminalizing anyone who seeks asylum in this manner.
To facilitate this, the country has invested millions of dollars equivalent in high tech surveillance to spot small boats. But despite this, a CNN
investigation found no evidence it was used during the deadliest incident in the channel last year. CNN's Katie Polglase reports.
(BEGIN VIDEOTAPE)
KATIE POLGLASE, CNN CORRESPONDENT (voice over): It's 3 in the morning on the 14th of December 2022 in the middle of the English Channel. A fisherman
has spotted multiple people in the water and is trying to haul them out.
RAYMOND STRACHAN, FISHERMAN: It was, pitch dark. It was a very cold night, minus one, minus two. And there was a lot of screaming.
POLGLASE (voice over): In total, they rescue 31 people from the sinking vessel, including two Afghan boys just 12 and 13 years old.
STRACHAN: This is not an area that we fish in a lot, and if we weren't there, everyone there would have probably drowned.
POLGLASE (voice over): U.K. authorities arrive later and rescue eight more.
[09:25:00]
Four die in what becomes the worst migrant tragedy in the channel that year. But officials have been informed of the incident nearly an hour
earlier.
UNIDENTIFIED MALE: Please help. We have children and family in a boat. Please, we are in the water.
POLGLASE (voice over): At just before 2 am, the boat has made a distress call here to Utopia 56, a French migrant charity that passed it on to the
French and U.K. authorities. The French Coast Guard say the boat is undetectable on shipping radar, but estimate it will shortly cross into
British waters.
Now CNN has found that at the time of the incident, the U.K. government had expensive AI technology designed to spot these boats and knowing that the
vessel was soon entering their territory, and that there were people freezing in the water including children they could have sent this.
Tekever AR5 drone designed to detect small boats and capable of deploying a life raft. It's licensed by the U.K. Government, even the British Prime
Minister proud to show it off. CNN has established it flew over the same area where the distress call was made on multiple previous journeys.
And even flew the day before and after the incident, but not in the hours the vessel was sinking. Instead it took more than an hour for the first
U.K. lifeboat to arrive in which time a fishing crew rescued the majority on board.
UNIDENTIFIED MALE: We must stop the boats.
POLGLASE (voice over): This tech forms part of a campaign of deterrence and hostility by the government towards those attempting to reach British
shores. Millions of pounds have been spent on AI cameras trained to find rubber dinghies, some able to see beyond U.K. waters drones with Automatic
Identification abilities.
And while the company's tout their life saving capabilities, footage from these drones has also been used to identify those driving the boats and
prosecute them for human trafficking. A new bill will take it even further criminalizing anyone who seeks asylum in the U.K. this way.
PETRA MOLNAR, HUMAN RIGHTS AND MIGRATION LAWYER: Yes, technologies could very easily be used for search and rescue for finding votes faster for
preventing these horrific disasters. But unfortunately, the reality on the ground is the opposite. It's assisting powerful actors to be able to
sharpen their borders make it more difficult for people to come and again, you think surveillance for these kinds of ends.
POLGLASE (voice over): And it follows a global trend in digitizing border security.
UNIDENTIFIED MALE: These towers operate 24/7, 365.
POLGLASE (voice over): The same century tower was made by the American tech startup Anduril that line the U.S.-Mexico border have recently been
installed along the British coastline to identify and track boats. Another company serious insight AI, whose technology is also available to the U.K.
authorities, insisted that tech is used for saving lives.
But stop short of talking about how the government uses it?
MALCOLM GLAISTER, CEO OF SIRIUS INSIGHT AI: Our equipment shows any vessel that's in the U.K. territorial waters where it is and where it's going. And
if that vessel is in distress, it allows the lifeboat to get to that precise location because we're tracking it.
POLGLASE (on camera): And so we've been following some of the incidents that have unfortunately led to fatalities in the channel. If we have this
technology, why are people dying?
GLAISTER: I don't think I can comment on those instances, because of the commercial nature of their relationship with the home office.
POLGLASE (voice over): The Home Office declined to comment on the incident on the 14th of December. In response to a freedom of information requests
submitted by CNN, U.K. Border Force said revealing the text capability might aid the criminals facilitating the crossings and increased risk to
life at sea.
The Coast Guard declined to comment citing an ongoing investigation into the incident and a court case underway to prosecute the alleged driver of
the boat. A new record was set for June with nearly 4000 people detected arriving to the U.K. But for those that do make it, they face an
increasingly hostile welcome. Katie Polglase is CNN London.
(END VIDEOTAPE)
CHATTERLEY: More FIRST MOVE after this.
(COMMERCIAL BREAK)
[09:30:00]
CHATTERLEY: Welcome back to FIRST MOVE. The first day of trade on Wall Street for the week and the bulls are hoping to break some all-time
records. It is actually a mixed picture though in early trade. But the DOW is beginning the last trading day of July, only about what 3 percent away
from its first record highs in around 18 months.
All the major averages also set for solid monthly gains, the fifth straight monthly advance in fact for the NASDAQ and for the S&P 500. And Investors
are thinking this rally could have legs, more stock sectors and not just tech beginning to see investor interest market breath is always a good
thing. The rally is a global one too.
Let's be clear, the German DAX hitting record highs today as we mentioned earlier, the Japanese topics is at 33 year highs. Stock gains reflecting
hopes for firmer global growth which will only fuel energy demand both Brent and the U.S. crude trading over $80 a barrel on, on track their best
month in fact, since January.
Kristina Hooper is Chief Global Market Strategist at Invesco and joins us now, Kristina, happy summer, great to have you on the show. Can we talk
about the message from stock market investors? Broadly at this moment, there does seem to be a sense that the worst has passed as far as the
inflation threat is concerned and that central bankers have managed this relatively well. Confidence is good, or some of them too confident.
KRISTINA HOOPER, CHIEF GLOBAL MARKET STRATEGIST, INVESCO: I think there might be too much confidence particularly around when the Fed is expected
to start cutting rates. I think there could be some disappointment for stock market investors in the near term, as they come to reprise
expectations around when rate cuts are likely to start. Now it shouldn't be a surprise because we've heard the Fed repeat over and over again, they
don't plan to cut anytime soon.
However, I do think that the prevailing wisdom among stock market investors is that they will see cuts fairly soon. And that could lead certainly to
some disappointment. I also think in general after a pretty significant rally like the one we've seen this year. This is time for a period of
digestion as we wait for the next Fed meeting. And quite frankly, we wait for what other central bankers are going to do as well.
CHATTERLEY: You're skipping past the prospect of them hiking again if there is some kind of growth real acceleration. And I know you're not expecting
that.
[09:35:00]
In fact, in your note this week, you said if you were a country singer, this song would be how I can miss you if you won't go away in terms of
their ability to keep coming back to this and hiking more which amused me. Can we completely rule that out? The disappointment then is the timing of
the cuts versus anything else. And does that mean we see some kind of consolidation or a period then in the rally that we've seen for U.S.
markets?
HOOPER: Well, we can't completely rule it out. Certainly the Fed feels confident that the economy is on solid footing. And that has appeared very
clear in recent communications from the Fed, especially Jay Powell's press conference last week. So certainly they feel emboldened to hike again, if
they need to.
I'm just not sure they're going to need to, because the inflation data is moving in the right direction. Now, of course, we have a long period of
time, eight weeks for the Fed to really assess the inflation picture. But I do think there certainly is the potential for the Fed to hike rates, it
could do that it's not afraid to do that.
And certainly that could be something of a slight setback for the stock market. But again, in general, this should be a period of digestion, given
the significant gains we've seen thus far this year. We do know that historically, once the Fed does stop hiking rates that tends to begin a
period of positive stock market performance in the following year.
So it could be a scenario where we see some short term digestion. And then by the end of the year, the stock market is actually modestly higher than
where we are today.
CHATTERLEY: Yes, it's funny, because I look at the performance that we've seen, sort of year-to-date now for stocks. Particularly if you look in the
tech sector, in particular, and wonder sort of how much of that sort of good news on the end of rate cycle is already in the price for some of
these, what provides the leadership?
And can you sort of in some way, tie that to what we've seen so far for earnings season? What your, what your views are on the outlook of that?
HOOPER: Well, certainly earnings season has been fairly good, just because expectations have been diminished, right. Companies have been fairly good
at managing expectations. So I actually think that the leadership is certainly going to be helped by earnings season. And we've seen a
broadening really since June 1.
For the stock market, it had been really a story about tech driving returns. And now it's certainly been a broadening. But I think ultimately,
what we're going to see and where we're going to see the rotation coming from is an expectation on the part of markets that the economy will be
recovering.
I think we'll see a discounting of an economic recovery, which means smaller caps will perform better, cyclicals will perform better. But that
should take some time. I think that next up on deck for the stock market is probably a period of consolidation.
CHATTERLEY: And very quickly, Kristina, can I get your take globally? What do you like, as you look around the world? I've mentioned the Japanese
stock market a couple of times. I know they shifted some of the monetary policy in the past week to. What do you like when you look internationally?
HOOPER: Well, I'm getting more excited about China, just given that we're getting closer to more tangible plans for stimulus directed at driving
consumption. So that could certainly provide a nice boost to Chinese equities. Certainly in the shorter term we have seen a mini rally there.
Also, in general, I think that a weaker dollar is likely to make stocks look more attractive in a variety of areas outside the United States. I
would focus in on though, Asia emerging markets, not just China, but other emerging markets, countries in Asia that are benefiting from not just the
China reopening, but their own stories. There's a lot of growth there. And demographics are certainly in their favor.
CHATTERLEY: Yes, we need to hone in on that. We will reconvene Kristina, great to have you with us. Kristina Hooper, Chief Global Market Strategist
at Invesco, thank you. OK, coming up after the break, fuelling a cleaner aviation sector how sustainable aviation fuel will help airlines become
cleaner and greener next.
(COMMERCIAL BREAK)
[09:40:00]
CHATTERLEY: Welcome back to FIRST MOVE. More than 3.8 billion passengers flew around the world last year, and those planes generated 2 percent of
the world's carbon emissions powered by fossil fuels. The industry is clearly looking at ways to address this with things like electric and
hydrogen powered jets. But what if we could simply use cleaner fuel?
It's called Sustainable Aviation Fuel or SAF for short. LanzaJet meets this fuel using low carbon ethanol in a process called Alcohol to Jet or ATJ.
This reduces the carbon footprint by more than 80 percent during its lifecycle. The fuel can be used by regular aircraft and can use existing
refueling systems without modification.
But there's clearly a huge tank to fill. IATA estimate suppliers will make at least 79 million gallons of staff this year, sounds a lot. Well, it is
but in 2019 global aviation guzzled 95 billion gallons of aviation fuel. OK, let's discuss. Jimmy Samartzis is the CEO of LanzaJet. And he joins us
now.
Jimmy, you are on a mission. I tell you what I do like about SAF is that it works with the infrastructure that we have today. Talk us through your
plans.
JIMMY SAMARTZIS, CEO, LANZAJET: That's exactly right. SAF is the solution that the aviation industry sees as being the most probable solution in the
near mid and long term, along with replacing aircraft and flying more efficiently. But SAF, they see as 60 to 70 percent of the solution to get
to net zero emissions, by the way by 2050, which is what the industry has set as the goal.
And here at LanzaJet, as you pointed out, we use ethanol as the starting point. And we're able to convert that ethanol molecule into a drop in jet
fuel product that can use existing infrastructure, existing aircraft engines, and can be used today. We've already flown two commercial flights,
one with Virgin Atlantic, across the Atlantic Ocean to the UK, and one with All Nippon Airways over to Japan.
CHATTERLEY: OK, and you use SAF with traditional aviation fuel to and you can blend it in different concentrations. So you can in a way, and we'll
come back to the price. You can take your pick, at least at this stage of what concentration of the SAF you use along with the aviation fuel, so the
more the better, arguably in terms of green efficiency, if nothing else.
SAMARTZIS: And that's absolutely right, so SAF today has to be blended up to a maximum of 50 percent. As you can imagine flying airplanes safety is a
top priority. The quality of the fuel that gets produced has to meet very specific qualifications that are approved by a body called ASTM.
[09:45:00]
Our pathway, Alcohol to Jet was approved by ASTM in 2018, which means that the fuel that we produce is viable and meets the quality and safety
specifications to be flown on commercial airlines. At the end of the day --
CHATTERLEY: Yes.
SAMARTZIS: Yes, go ahead.
CHATTERLEY: No, I was just going to say above 50, the performance isn't good enough. So you have to stay below 50 percent at least for now.
SAMARTZIS: Now, we can actually use the fuel up to 100 percent. One of the benefits that we have in using SAF as we pull out aromatics, which exist in
crude oil based jet fuel, the aromatics that we pull out is what gives us some of the positive environmental performance. So there's a lot of work
going on within the industry right now to actually approve these drop in fuels up to 100 percent. That is only a matter of time.
But that's also why relationships and partnerships with the likes of Airbus and Boeing and the engine manufacturers are important to us, so that we can
get to the point where we can use our fuel as 100 percent drop in fuel.
CHATTERLEY: OK, so these are all the positives. Now let's talk about some of the challenges cost. How does a gallon of SAF compared to the cost of
aviation fuel today? How many times more expensive is it at least for now?
SAMARTZIS: Yes, we're at the infancy of the industry. So as you can imagine new technology being deployed, that hasn't yet scaled up fully, the costs,
are going to be higher. Most folks quote on average two to three times the price of fossil jet fuel. But we with our technology fully expect that that
costs will come down substantially as we scale up our technology and deployed on a global basis.
CHATTERLEY: Who's going to help subsidize Jimmy, it's not going to be done by corporations alone, however invested they are in, in greening up and
protecting the planet, government subsidies that are required? Do you agree and to what extent should they be subsidizing this?
SAMARTZIS: I do agree it's necessary as you're building a new industry. If you think about what we're doing, we're disrupting a fossil fuel industry
that has been doing this work with fossil based jet fuel for 80 plus years. As you get new technologies off the ground as you get a new industry off
the ground, as you build comfort with airlines, and with airports around the use of the fuel.
There's a lot that needs to happen still. Policy does make a big difference. Here in the U.S. with the Inflation Reduction Act, it is
probably one of the most monumental pieces of legislation to help get this industry off the ground.
It is performance based, which means that if you do the right things from a sustainability perspective, if you have the right reduction in carbon
intensity, you have a higher value in the incentive, very different in other parts of the world. Places like the European Union, they mostly have
mandates.
The Japanese government has recently announced that they intend to introduce a 10 percent mandate by 2030. So you have a wide range of
policies that are falling into place, but absolutely critical in these early stages to help us get the industry off the ground.
CHATTERLEY: Yes, I feel like it's OK making a mandate, but you have to work out how the financing takes place it at the same time, I've added up. And
I've seen it written a couple of times. You can correct me though, if it's wrong of all the projects that you're talking about around the world.
And I know it includes North America, Europe and Asia, around a billion gallons of SAF could potentially be produced. I use the stat in the
introduction 95 billion gallons consumed in 2019 scale. Jimmy, how do we scale this up efficiently?
SAMARTZIS: Yes, it's a big challenge. But it's also a huge opportunity for all of us. I'm actually talking today from our first plant here in the
state of Georgia. It is actually the world's first alcohol to jet facility. This is a small plant in comparison to what's needed to be done. But it is
the requisite first step as we commercialize our technology.
There are many pathways ASTM, the body that I mentioned earlier, has approved seven pathways to date. You have technology that's been deployed
globally that uses animal fats, oils, and greases. And it's a technology that is more accustomed to the traditional refinery environment, if you
will. But that's only a pathway, ours is another pathway.
We need all of these pathways to succeed on a global basis in order for us to truly make the impact that that we need to have. The United States has a
goal of 3 billion gallons by the year 2030. We've committed to the White House and the administration that we can do, one billion gallons of that.
But you're right 100 billion gallon target on a global basis with 2019 gallons is a pretty substantial gap. So it does require all solutions on
the table.
CHATTERLEY: It's enormous, very quickly. You mentioned that this is a long term solution and not just a bridge. So a bridge to new technologies like
electric or our hydrogen powered aircraft for example, how much of the gap that we have to get in terms of reducing carbon emissions? Do you think
longer term is filled by cleaner fuel versus new technologies?
[09:50:00]
Because, as I mentioned in the introduction, if you're going to use new technologies, everybody has to be able to cope with it wherever you're
flying in the world, this works for all. How much of the gap is filled with fuel versus tech?
SAMARTZIS: You're exactly right; the fuel is expected to solve about 60 to 70 percent of the obligation, right to reduce to net zero. You know, it's,
it works today, it's going to work well into the future. And as we transition into the future, we can make ethanol from other waste sources,
things like municipal solid waste, agricultural residues, things that are second generation, as we call them, not just using first generation energy
crops.
So for us, there's a very long and bright sort of history ahead of evolving the supply chains involving the feedstock to continue to improve the carbon
intensity of the fuels that we produce.
CHATTERLEY: Yes, because that's one of the criticisms, isn't it that it diverts foodstuffs or sources of foodstuff and planting away from human
consumption. We've got more to talk about. I'll get you back. Jimmy, come back soon please, more to discuss.
SAMARTZIS: OK, thanks.
CHATTERLEY: The CEO of LanzaJet, good to chat to you, sir. Thank you. We're back after this.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to FIRST MOVE. And to the Women's World Cup, the co-hosts Australia is advancing to the knockout stage as they eliminate
Olympic champions Canada. And earlier Japan stuns Spain with four goals. Amanda Davis joins us now. Amanda, we have to talk about Japan. Wow.
AMANDA DAVIES, CNN WORLD SPORT: Yes, Julia heading into this tournament people were talking about six or seven teams weren't they who could
potentially win it. I have to say nobody was particularly loudly talking about Japan. But in this game today against Spain, one of the most talented
squads of players in this tournament without doubt, they scored more goals in one game than they did in the entirety of their four matches.
The last tournament four years ago, they have been so impressive. They started with five goals against Zambia and other two against Costa Rica.
And here they were with such a show of intent. They didn't dominate possession. But when they got their chances, they took their chances.
And there are a whole lot of people getting very, very excited about this young Japan squad who have been quietly progressing through the ranks of
the junior tournaments, the likes of the under seven teams, the likes of the under 20s feeling that perhaps just maybe this could be their chance of
going for another deep run in the competition, which they won, of course in 2011.
But if they won four nil, so too, did the tournament co-hosts Australia, the Matilda's as they're not quite waltzing, there was a whole lot more
urgency than that in this one. They knew they have to win or it was the co- host out of course suffering the same fate that New Zealand did over the weekend.
[09:55:00]
They were up against the Olympic gold medal winners, Canada. They had the weight of expectation and pressure, a full Melbourne crowd and of course,
all those questions over there star player, Sam Kerr, but they wasted no time. This was a real show of intent for them.
All the players, all the team came together at the moment when it mattered. Hayley Raso has just secured a move to Spain to Real Madrid. She scored two
in the first half. Steph Catley is there finishing the victory off. So from third in the group and facing exit is Australia who goes through top of
their group alongside Nigeria. But a really sad end to a tournament, lots of questions being asked about the Olympic champions in Canada, Julia.
CHATTERLEY: Yes. Just nice to look at happy smiling faces and people celebrating. Great to have you, Amanda Davies, thank you. And that's it for
the show. CONNECT THE WORLD is up next, we'll see you tomorrow.
(COMMERCIAL BREAK)
END
