WEBVTT - Bloomberg Daybreak: July 21, 2022 - Hour 2 (Radio) 0:00:04.280 --> 0:00:07.400 Live from the Bloomberg Interactive Burger Studios. This is Bloomberg 0:00:07.480 --> 0:00:11.400 day Break for Thursday July two. Coming up this hour, 0:00:11.600 --> 0:00:15.280 Mario Draggy resigns as Italian Prime Minister. We are live 0:00:15.320 --> 0:00:17.680 in Europe with the latest the e c D gets 0:00:17.720 --> 0:00:20.920 ready to join central banks and raising rates. Tesla shares 0:00:21.040 --> 0:00:24.240 rise after earnings top estimates, the growing number of companies 0:00:24.239 --> 0:00:27.240 slam the brakes on hiring, and the January sixth hearing 0:00:27.360 --> 0:00:30.720 skill Prime Time. The Heat Advisory extended to Sunday night 0:00:30.880 --> 0:00:33.360 at Donald Trump returns to New York for his ex 0:00:33.360 --> 0:00:36.360 wife's funeral. I'm John Tucer. Those stories straight ahead, I'm 0:00:36.400 --> 0:00:39.400 John Stahns forwards. The Yankees returned for the All Star break. 0:00:39.440 --> 0:00:41.680 They play a day night double letter with the Astros 0:00:41.720 --> 0:00:46.920 in Euston. That's all straded ahead on Bloomberg day Break 0:00:47.240 --> 0:00:50.920 on Bloomberg eleven, Free on New York, Bloomberg ninety nine one, 0:00:51.040 --> 0:00:55.000 Washington d C, Bloomberg one oh six one, Boston, Bloomberg 0:00:55.080 --> 0:00:59.160 nine sixties, San Francisco, Sirius XAM one nine team, and 0:00:59.240 --> 0:01:02.319 around the world on Bloomberg Radio dot Com and via 0:01:02.400 --> 0:01:12.400 The Bloomberg Business and Good Morning, I'm Karen Moscow. I'm 0:01:12.440 --> 0:01:14.240 Nathan Heger. Bloomberg day Break, brought to you by B 0:01:14.319 --> 0:01:16.720 and Y Melon's Pershing learned by the world's most sophisticated 0:01:16.760 --> 0:01:19.600 wealth management and institutional firms rely on Pershing to help 0:01:19.640 --> 0:01:23.120 them improve profitability, create efficiency, attract talent and manage risk 0:01:23.160 --> 0:01:27.920 at pershing dot com. US futures are little change this morning. 0:01:28.080 --> 0:01:31.640 SMP futures are down about four points down, futures down 0:01:31.680 --> 0:01:35.000 sixty six and NASDAG futures again. That will change the 0:01:35.080 --> 0:01:37.440 ten year treasury down four thirty seconds, you know, three 0:01:37.440 --> 0:01:40.760 point oh four percent, Nathan, Karen, we begin with turmoil 0:01:40.840 --> 0:01:44.280 in the Italian government. Prime Minister Mario Draggy is resigning. 0:01:44.319 --> 0:01:46.960 The former European Central Bank chief announced his decision to 0:01:47.000 --> 0:01:50.240 President Sergio Mantarella in a meeting earlier this morning. Bloomberg 0:01:50.240 --> 0:01:53.080 new senior editor in Italy, Gerald Colton, says the resignation 0:01:53.160 --> 0:01:57.120 raises the prospect of snap elections. Elections are almost certainly 0:01:57.160 --> 0:02:00.280 the next be Traditionally year in Italy, election state plate 0:02:00.560 --> 0:02:04.240 in the spring to allow business to go on in parliament, 0:02:04.320 --> 0:02:08.280 particularly the budget. In this case, we'll probably have something unprecedented, 0:02:08.320 --> 0:02:11.880 will probably have elections in the fall. Either the last 0:02:11.880 --> 0:02:15.040 weekend in September or the first in October would be 0:02:15.040 --> 0:02:17.720 the most likely time. Bloomberg News Senior editor in Italy, 0:02:17.760 --> 0:02:20.840 Gerald Colton, says the market reaction has been swift. The 0:02:20.880 --> 0:02:23.919 country's benchmark stock indexes down one and a half percent. 0:02:24.160 --> 0:02:28.120 Benchmark tenure Italian bond yields are surging well. Nathan. The 0:02:28.200 --> 0:02:31.880 Drazzee drug resignation comes as the European Central Bank gets 0:02:31.919 --> 0:02:34.080 ready to raise interest rates, and we go to London 0:02:34.080 --> 0:02:36.840 and get the latest with Bloomberg's un Pats, good morning you, 0:02:37.000 --> 0:02:39.480 and good morning Nathan and Karen. Will it be twenty 0:02:39.480 --> 0:02:42.320 five or will it be fifty? The European Central Bank 0:02:42.360 --> 0:02:44.560 today's set to raise indust rates for the first time 0:02:44.680 --> 0:02:47.800 in eleven years, joining payers around the world in confronting 0:02:47.840 --> 0:02:51.600 an historic spike in inflation. With staring prices across the 0:02:51.639 --> 0:02:54.320 line team nation Eurozone. The ECB may even deviate from 0:02:54.320 --> 0:02:57.200 the guidance it said by considering a hike of double 0:02:57.440 --> 0:03:00.519 the planned quarter points. Will find out lay to today 0:03:00.800 --> 0:03:03.919 in London. I'mumport Sploomberg day Break, thanks you, And in Asia, 0:03:03.960 --> 0:03:06.840 the Bank of Japan left its interest rates unchanged. We 0:03:06.880 --> 0:03:09.760 get that story from Bloomberg day Break Asia anchor Brian Curtis. 0:03:09.919 --> 0:03:12.440 The b o J put its concern about growth ahead 0:03:12.480 --> 0:03:15.840 of any potential implications for the end. It locks in 0:03:15.919 --> 0:03:18.400 an outlier stance of the b o J compared with 0:03:18.440 --> 0:03:21.800 other central banks desperately fighting inflation. A downgrade in the 0:03:21.840 --> 0:03:25.080 growth forecast comes amid new COVID cases at home and 0:03:25.200 --> 0:03:28.080 lockdowns in China. What the b o J is saying 0:03:28.240 --> 0:03:32.080 is you need a solid recovery to make inflation sustainable, 0:03:32.240 --> 0:03:35.960 and that means lower for longer. Brian Curtis Sploomberg day Break. 0:03:36.480 --> 0:03:38.760 All right, Brian, thank you all. Turning to corporate earning, 0:03:38.800 --> 0:03:41.560 shares a Tesla up almost three percent in early trading. 0:03:41.560 --> 0:03:44.640 The ev market leader reported second quarter earnings at beat 0:03:44.680 --> 0:03:48.040 Wall Street estimates. Tesla also sold a significant chunk of 0:03:48.040 --> 0:03:52.800 its steak and bitcoin, converting roughly sevs bitcoin into fiat currency. 0:03:53.080 --> 0:03:55.840 CEO Elon Musk talked about it in a conference call 0:03:55.920 --> 0:04:00.640 with analysts. We are certainly open to increasing up coin 0:04:00.680 --> 0:04:03.720 holdings in future um so they should not be taken 0:04:03.760 --> 0:04:09.120 as some verdict on goodcoin. It's just that we were 0:04:09.160 --> 0:04:12.200 concerned about overall liquidity for the company. Given code shutdowns 0:04:12.200 --> 0:04:15.640 in China. Testa CEO Elon Mus said the company has 0:04:15.680 --> 0:04:18.200 been through quote supply chain hell, but he's saying now 0:04:18.240 --> 0:04:20.720 the optimism Tesla can achieve a record of volume over 0:04:20.760 --> 0:04:23.080 the rest of the year. Well. Growing number of companies 0:04:23.080 --> 0:04:25.960 are slamming the brakes on hiring. Karen and Bloomberg's Vernita 0:04:26.040 --> 0:04:29.760 Young has more on that. Good morning, Rnita, Good morning Nathan. Microsoft, Google, 0:04:29.800 --> 0:04:32.400 and Lift are some of the latest companies to freeze 0:04:32.480 --> 0:04:37.760 hiring as recessent recession fears loom, inflation mounts, the war 0:04:37.839 --> 0:04:41.400 in Ukraine continues, and the lingering pandemic takes a toll. 0:04:41.880 --> 0:04:45.880 Microsoft is eliminating many job openings. Google's pausing hiring for 0:04:45.920 --> 0:04:48.839 the next two weeks. Lift is shutting down a division 0:04:49.120 --> 0:04:53.040 and trimming jobs. Meantime, Bloomberg sources say Ford is preparing 0:04:53.080 --> 0:04:55.520 to cut as many as eight thousand jobs in the 0:04:55.560 --> 0:04:58.839 coming weeks. The automaker is trying to boost profits to 0:04:58.920 --> 0:05:02.520 fund its push into the electric vehicle market. Live in 0:05:02.560 --> 0:05:06.240 New York, I'm renaed a Young Bloomberg Daybreak. All right, 0:05:06.279 --> 0:05:07.880 we need to thank you. The news of the slowdown 0:05:07.880 --> 0:05:10.159 in corporate high rank comes as the labor Department gets 0:05:10.160 --> 0:05:13.560 ready to issue weekly jobless claims. Data economists or forecasting 0:05:13.560 --> 0:05:16.440 claims will remain elevated after setting a record low earlier 0:05:16.480 --> 0:05:19.560 in the year, and Bloomberg's Videol Judais reports in the 0:05:19.560 --> 0:05:23.120 Prairie Report, jobless claims rose to two four thousand the 0:05:23.200 --> 0:05:27.320 Hyacinths November. Bloomberg Economics says this year's increase may set 0:05:27.320 --> 0:05:30.080 the stage for a broader labor market slowdown. The four 0:05:30.120 --> 0:05:33.240 week average for jobless claims has been moving steadily higher 0:05:33.279 --> 0:05:36.680 to also today the Conference Board issues Junes and Decks 0:05:36.720 --> 0:05:40.119 of leading economic indicators, It's dropped in four the past 0:05:40.160 --> 0:05:44.360 five months, signaling a slowdown. Final Judas Bloomberg, Daybreak and 0:05:44.520 --> 0:05:47.040 Sney and Political News. President Biden says he could speak 0:05:47.040 --> 0:05:50.360 with China's Shi Jin Ping within ten days. Bloomberg's Baxter 0:05:50.480 --> 0:05:53.440 reports a whole plate full of issues, but this does 0:05:53.560 --> 0:05:55.720 come as the US has said publicly it is thinking 0:05:55.760 --> 0:05:58.600 about rolling back some of the tariffs and average to 0:05:58.640 --> 0:06:02.960 possibly ease inflay pressures, but White House sources have downplayed 0:06:03.040 --> 0:06:06.640 that issue now, saying that Biden wants to talk Ukraine 0:06:07.160 --> 0:06:10.719 and China, seeming support of Russia along with human rights 0:06:10.839 --> 0:06:13.720 issues in Hong Kong and jin Jong, as well as 0:06:13.800 --> 0:06:18.560 relations with Taiwan in San Francisco. I'm at Baxter Bloomberg 0:06:18.640 --> 0:06:21.600 Daybreak and thank you. The committee investigating the assault in 0:06:21.640 --> 0:06:24.760 the US Capitol plans to proceed with the primetime hearing tonight. 0:06:24.839 --> 0:06:27.080 We get a preview from Bloomberg j Amy Morrison our 0:06:27.640 --> 0:06:30.520 one newsroom mid Washington. The committee is set to hold 0:06:30.560 --> 0:06:33.000 the televised hearing at eight pm Eastern. It will be 0:06:33.080 --> 0:06:35.839 the eighth hearing since June and the second in primetime. 0:06:36.080 --> 0:06:40.120 Republican Adam Kinzinger and Democrat Elaine Luria will lead the hearing, 0:06:40.440 --> 0:06:43.680 aiming to show that the former president deliberately chose not 0:06:43.920 --> 0:06:46.880 to intervene during the attack on the Capitol. They'll walk 0:06:46.960 --> 0:06:49.120 through what was going on in the West Wing during 0:06:49.200 --> 0:06:52.040 and after the attack, and what happened the next day. 0:06:52.480 --> 0:06:56.240 Videotaped testimony of former White House Council Pat Sippoloni will 0:06:56.279 --> 0:06:59.440 play a crucial role in tonight's hearing in Washington. I 0:06:59.520 --> 0:07:02.160 may be more has Bloomberg Daybreak, Amy, Thank you. SMP 0:07:02.320 --> 0:07:05.080 futures are down four point Staff futures down seventy two. 0:07:05.160 --> 0:07:08.440 Nasdaq futures are higher now by eight points. The tenure 0:07:08.520 --> 0:07:12.560 treasury is down four thirty seconds yield three point zero 0:07:12.760 --> 0:07:15.840 four percent. Straight ahead, your latest local headlines and a 0:07:15.960 --> 0:07:23.560 check of sports. This is Bloomberg and at six o 0:07:23.680 --> 0:07:26.360 seven on Wall Street where eighty degrees in Central Park 0:07:26.440 --> 0:07:30.200 southbound two eighty seven's closed after Route seventeen for an accident. 0:07:30.280 --> 0:07:33.000 More on that coming up in traffic. First, John Tucker 0:07:33.480 --> 0:07:37.280 trying to stay cool in New York. It's tough, John, Well, yeah, 0:07:37.400 --> 0:07:40.600 the heat is on, Nathan. Heat advisory remains an effect 0:07:40.680 --> 0:07:44.760 until Sunday night. And Bloomberg meteorolog just Rob Carolin joins 0:07:44.840 --> 0:07:47.360 us this morning with Moore. John, it's the heat that's 0:07:47.360 --> 0:07:49.320 been in the century United States that's had a chance 0:07:49.400 --> 0:07:51.480 to move in over the area and it will hang around, 0:07:51.560 --> 0:07:53.320 and we have a weak funnel system headed our way 0:07:53.360 --> 0:07:55.720 that'll trigger some showers and thud of storms this afternoon, 0:07:55.800 --> 0:07:57.840 some of which would be strong. It leads to it 0:07:58.000 --> 0:08:00.280 not being as humid tomorrow, but it's still hot. And 0:08:00.360 --> 0:08:03.400 then the heat piece over the weekend where near a 0:08:03.480 --> 0:08:05.880 hundred by the time we get the Sunday John, Bloomberg 0:08:05.920 --> 0:08:09.040 Meteorologist Rob Caroline this morning, the operator of a major 0:08:09.200 --> 0:08:12.680 pipeline from Russia to Europe since natural gas has started 0:08:12.760 --> 0:08:16.600 flowing again. The pipeline is Germany's main source of runching gas. 0:08:17.120 --> 0:08:20.720 Bloomberg Stephen Stevinski says they're now watching closely. They see 0:08:20.840 --> 0:08:24.400 just how much gas actually comes through the pipeline. There 0:08:24.600 --> 0:08:26.880 is a steer that yes, we're at right now, but 0:08:26.960 --> 0:08:28.800 how long will this last? Can you trust putin ke 0:08:29.280 --> 0:08:32.480 gas from Gage, trust Russia to keep the gas flowing 0:08:32.559 --> 0:08:35.320 through this vital transit point. You look at what he's 0:08:35.360 --> 0:08:37.319 been saying, and he said that it doesn't get this 0:08:37.480 --> 0:08:41.800 vital part, then he's going to reduce flows in his 0:08:41.960 --> 0:08:45.079 next week, and that causes more distress for the European region, 0:08:45.320 --> 0:08:48.559 German officials that fear the pipeline might not reopen at all. 0:08:49.080 --> 0:08:52.280 Former President Donald Trump was in Manhattan yesterday for the 0:08:52.360 --> 0:08:55.240 funeral of his ex wife of Donna Trump. More from 0:08:55.280 --> 0:08:59.280 Bloomberg's Charlie Pillett. This morning, John Trump joined all his children, 0:08:59.480 --> 0:09:02.400 all the rell tives and friends at St. Vincent for 0:09:02.559 --> 0:09:05.800 Our Roman Catholic Church on Manhattan's Ouper East Side for 0:09:06.040 --> 0:09:10.760 Ivanna's funeral mass. Writing on his social media platform Truth Social, 0:09:11.080 --> 0:09:13.640 Trump called it a very sad day, but at the 0:09:13.720 --> 0:09:17.480 same time a celebration of a wonderful and beautiful life. 0:09:17.920 --> 0:09:21.800 Ivanna and Donald Trump's three children, Donald Jr. Ivanka, and Eric, 0:09:22.120 --> 0:09:25.120 stood with their father and their families as the gold 0:09:25.200 --> 0:09:29.360 tone casket was carried from the church. John Bloomberridge Charley 0:09:29.440 --> 0:09:32.800 Pillett Feizer will spend four hundred seventy million dollars to 0:09:32.880 --> 0:09:37.079 expand its vaccine research facilities twenty five miles northwest of 0:09:37.120 --> 0:09:39.720 New York City, with the company hopes to maintain its 0:09:39.920 --> 0:09:43.920 edge in the booming field of messenger RNA, the technology 0:09:44.000 --> 0:09:47.439 behind its blockbuster COVID nineteen shot. The drug baker will 0:09:47.480 --> 0:09:51.000 construct a new building and renovate existing facilities at its 0:09:51.120 --> 0:09:54.400 campus in Pearl River. Global News twenty four hours a 0:09:54.480 --> 0:09:57.240 day on Aerona Bloomberg Quicktake were powered by more than 0:09:57.320 --> 0:10:00.200 twenty seven hundred journalists and analysts it more than one 0:10:00.640 --> 0:10:04.800 twenty countries. John Tucker, This is Bloomberg, Nathan. Thanks John. 0:10:09.440 --> 0:10:11.560 Almost six ten on Wall Street time for the Bloomberg 0:10:11.640 --> 0:10:13.959 Sports Update with John stash Our. All right, Nat In 0:10:14.000 --> 0:10:16.360 the Yankees and Astros have become a rivalry, even though 0:10:16.400 --> 0:10:18.640 Houston has only been an American League team for a decade, 0:10:18.679 --> 0:10:20.640 but the Astros have beaten the Yanks of the postseason 0:10:21.040 --> 0:10:24.240 three times, of course, excused of banging trash cans and 0:10:24.360 --> 0:10:26.840 signed stealing, and this season they are the two best 0:10:26.960 --> 0:10:29.080 in the a L could very well be facing off 0:10:29.120 --> 0:10:31.240 in October again. The two teams WI turned to the 0:10:31.240 --> 0:10:33.599 All Star break and play a day night doublehead or 0:10:33.679 --> 0:10:37.400 in Houston makeups from the lockout. Yankees are sixty four 0:10:37.520 --> 0:10:40.320 and and Aaron Judge was asked the reason for their 0:10:40.400 --> 0:10:43.280 success this consistency. I think that's when it comes down to, uh, 0:10:43.360 --> 0:10:45.360 this this team saying consistent. You know, that's one thing 0:10:45.400 --> 0:10:47.319 we'll be able to do all year. You know, when 0:10:47.320 --> 0:10:49.199 it doesn't matter who we're playing. You know, if it's 0:10:49.240 --> 0:10:50.800 a you know, best team in the a L, or 0:10:50.840 --> 0:10:52.520 if it's you know, the team in last place, we're 0:10:52.520 --> 0:10:54.160 gonna go out there and you know, trying to win 0:10:54.160 --> 0:10:56.640 every single game, win every single series. And I think 0:10:56.679 --> 0:10:58.839 that's one thing that's helps uparate us this year from 0:10:58.880 --> 0:11:01.320 last year. Judge as thirty three home runs, that's how 0:11:01.360 --> 0:11:03.199 many Roger Marras had at this time, and even this 0:11:03.360 --> 0:11:06.160 nineteen six one with sixty one homers match turned for 0:11:06.200 --> 0:11:09.400 the break tomorrow City Field versus San Diego. James Harden 0:11:09.480 --> 0:11:12.760 traded by Brooklyn the Philadelphia. He declined to forty seven 0:11:12.800 --> 0:11:15.240 million dollar option. He's now resigned with the Sixers, will 0:11:15.280 --> 0:11:17.720 make less, but can be a free agent again next year. 0:11:17.800 --> 0:11:21.280 The forty Niners last year traded up drafted Tray Lance 0:11:21.320 --> 0:11:24.360 to be their quarterback. The incumbent QB Jimmy Garoppolo, has 0:11:24.400 --> 0:11:27.400 now recovered from shoulder surgery, and the Niners have told 0:11:27.480 --> 0:11:30.960 his agent to try and work out a trade. Seattle, Houston, 0:11:31.040 --> 0:11:34.720 and Cleveland seen as possible destinations. Giants begin training camp 0:11:34.840 --> 0:11:37.199 next week. The Giants news is that for two home 0:11:37.280 --> 0:11:39.839 games this season, they will wear the uniforms they wore 0:11:39.920 --> 0:11:42.520 back in the nineteen eighties and nineties. John stash Ward 0:11:42.559 --> 0:11:45.839 Bloomberg Sports, Nathan all Right, John thanks SMP futures down 0:11:45.920 --> 0:11:48.720 down two points, Stown futures down fifty eight, nastact futures 0:11:48.760 --> 0:11:51.680 moving higher now of eighteen points ten. Your treasury down 0:11:51.800 --> 0:11:55.120 six thirty seconds. The yield three point zero four percent, 0:11:55.440 --> 0:11:58.000 the euro one point zero one eight eight against the dollar, 0:11:58.080 --> 0:12:00.880 head of an ECB decision and pulled. Litical turmoil in 0:12:01.000 --> 0:12:07.720 Italy Bloomberg opinion columnist Marcus Ashworth joins us next Bloomberg 0:12:07.720 --> 0:12:10.200 eleven three oh weather heat advisory through eight p m. Sunday. 0:12:10.240 --> 0:12:12.559 We could have strong thunderstorms this afternoon, going up to 0:12:12.600 --> 0:12:15.840 the low nineties, low nineties tomorrow, mid nineties. Saturday could 0:12:15.880 --> 0:12:18.800 hit a hundred by Sunday. Right now eighty in Central 0:12:18.840 --> 0:12:25.079 Park markets, headlines and breaking news twenty four hours a 0:12:25.200 --> 0:12:28.160 day at Bloomberg dot Com, the Bloomberg Business at and 0:12:28.360 --> 0:12:38.240 at Bloomberg Quick Tape. He's a Bloomberg Business Flash and 0:12:38.280 --> 0:12:41.480 I'm Karen Moscow. European stocks are steady with US stock 0:12:41.520 --> 0:12:44.480 index futures as investors brace for the European central banks 0:12:44.559 --> 0:12:47.200 first interest rate hike in eleven years, while Russia resumes 0:12:47.200 --> 0:12:50.600 sending gas to Europe through a keep pipeline, dispelling investors 0:12:50.679 --> 0:12:53.320 worst fears. We checked the markets every fifteen minutes throughout 0:12:53.320 --> 0:12:56.240 the trading day on Bloomberg. Right now is in P futures, 0:12:56.240 --> 0:12:59.199 they're little change. Dow futures down fifty five and nowsday 0:12:59.280 --> 0:13:02.240 futures higher twenty six. The decks in Germany is down 0:13:02.280 --> 0:13:04.200 a third of a percent. The ten year treasury down 0:13:04.280 --> 0:13:07.199 five thirty seconds you three point four percent yield on 0:13:07.320 --> 0:13:10.360 the two year three point two three percent. Ninemex screwed 0:13:10.400 --> 0:13:12.959 Oiola is down about five percent, down four dollars seventy 0:13:13.040 --> 0:13:15.360 nine cents and ninety five dollars nine cents of barrel. 0:13:15.600 --> 0:13:17.880 COMEX School is down one point two percent or twenty 0:13:17.880 --> 0:13:21.360 dollars at six ninety seven seventy. The euro one p 0:13:22.240 --> 0:13:25.240 seven against the dollar, British pound one point one two 0:13:25.640 --> 0:13:27.680 and the end at one thirty eight point seven one. 0:13:27.760 --> 0:13:30.200 And looking at bitcoin, it's down one point one percent 0:13:30.520 --> 0:13:33.319 at twenty two thousand, nine hundred ninety five dollars. That's 0:13:33.320 --> 0:13:35.920 a Bloomberg business flash. Now here's John Tucker with more 0:13:35.960 --> 0:13:38.880 on what's going on around the world. John he Good morning, Karen. 0:13:39.120 --> 0:13:42.040 President Blinden's today but announce investments in new efforts to 0:13:42.120 --> 0:13:46.640 approve community policing in crime prevention. Russia's biggest pipeline at Europe, 0:13:46.679 --> 0:13:50.559 nord Stream one, has restarted the committee investigating the assault 0:13:50.640 --> 0:13:53.120 on the Capitol plans to proceed with a prime time 0:13:53.200 --> 0:13:57.839 hearing tonight. Mario Droni resigns as Italy's Prime minister, throwing 0:13:57.880 --> 0:14:01.600 that country in the turmoil. Sports. Major League Baseball returns 0:14:01.640 --> 0:14:05.240 to action tonight after the All Star Break Global News 0:14:05.280 --> 0:14:07.320 twenty four hours a day on here and on Bloomberg 0:14:07.400 --> 0:14:10.360 Quick Take power by more than twenty seven hundred journalists 0:14:10.360 --> 0:14:13.280 and analysts in more than one hundred twenty countries. I'm 0:14:13.360 --> 0:14:16.599 John Tucker. This is Bloomberg. Nathan alright, John, thank you 0:14:16.640 --> 0:14:18.559 at his six nineteen on Wall Street Life from the 0:14:18.559 --> 0:14:21.840 Bloomberg Interactive Broker Studios. This is Bloomberg Daybreak. On the 0:14:21.880 --> 0:14:24.680 morning of high drama in Europe. We bring in Bloomberg 0:14:24.760 --> 0:14:30.120 opinion columnist Marcus Ashworth on Italian Prime minister drags resignation 0:14:30.800 --> 0:14:34.000 just as his former body, the ECB gets ready for 0:14:34.200 --> 0:14:38.040 a key policy decision. Marcus good warning, what a confluence 0:14:38.120 --> 0:14:42.600 of events. What could drag eas resignation mean for the 0:14:42.680 --> 0:14:46.640 Eurozone more broadly? Oh? Um, well, it can be a lot. 0:14:46.880 --> 0:14:49.160 Or at the moment it's uh, he's gonna hang around 0:14:49.200 --> 0:14:53.360 to October um when as a caretaker, and you know, 0:14:53.480 --> 0:14:55.840 this is Italian politics, he could well come back, so 0:14:56.400 --> 0:14:59.000 don't count him out completely yet. But he has had 0:14:59.080 --> 0:15:03.800 his resignation formally accepted by the President Mattarella, which means 0:15:03.880 --> 0:15:05.720 that you know this in theory is the end and 0:15:05.760 --> 0:15:08.840 there will be an election in October six. Obviously, Italian 0:15:08.880 --> 0:15:12.040 bonds didn't take it very well. Having rallied hard yesterday, 0:15:12.080 --> 0:15:17.000 they've collapsed today. It's still not at levels seen perhaps 0:15:17.400 --> 0:15:19.640 you know last month in June, which was you know, 0:15:19.720 --> 0:15:22.800 really quite scary at one point teny years got over 0:15:22.880 --> 0:15:25.920 four four point two percent. So we're not at those 0:15:26.040 --> 0:15:28.680 levels yet. But we are waiting for the ECB and 0:15:28.960 --> 0:15:34.160 they're anti fragmentation tool a new safety net um. It's 0:15:34.320 --> 0:15:36.640 it's it's not gonna be called QUI. It's it's exactly 0:15:36.720 --> 0:15:39.440 like Q in every shape allards. Eyes are packed. Apart 0:15:39.440 --> 0:15:41.680 from the fact they tell you that it's not. Nonetheless, 0:15:42.040 --> 0:15:44.720 if that's a proper stake in it as an unlimited one, 0:15:45.200 --> 0:15:47.600 then I think Italian bonds will probably relax them and 0:15:47.720 --> 0:15:51.280 we can calm down. We also got the first rate 0:15:51.360 --> 0:15:54.000 height today. It's all coming at the same time. It's 0:15:54.040 --> 0:15:57.720 crazy for the moment um. Don't panic too much to 0:15:57.880 --> 0:16:00.560 this anti fragmentation. To all that works affecting from the 0:16:00.560 --> 0:16:06.960 e CV today apply to the ongoing turmoil in Italian politics. 0:16:07.040 --> 0:16:11.440 I mean, Italian political turmoil is almost par for the 0:16:11.520 --> 0:16:14.680 course in some ways, isn't it. You've got to the 0:16:14.800 --> 0:16:18.320 nub of it there, and it basically if the ECB 0:16:18.520 --> 0:16:20.920 has a really tricky problem here and trying to portray 0:16:21.120 --> 0:16:23.720 that any safety in it is not monetary financing. They're 0:16:23.760 --> 0:16:27.440 not just simply banning out of government which is not 0:16:28.320 --> 0:16:30.960 in control of its finances. And that's gonna be the 0:16:31.000 --> 0:16:33.360 really tricky one. Is there going to be some form 0:16:33.440 --> 0:16:38.360 of political and economic underwriting of of when this particular 0:16:38.440 --> 0:16:41.040 tool can be used or is it blind to all 0:16:41.080 --> 0:16:44.920 these different things? Who gets to interpret that? Uh? And 0:16:45.040 --> 0:16:46.800 that is going to be very very difficult thing for 0:16:46.880 --> 0:16:51.040 obviously Germany. To another more sort of austere countries is 0:16:51.080 --> 0:16:54.200 when it comes to financial prolicies, how they take it, 0:16:54.320 --> 0:16:56.480 how they react to it. You know, could there be 0:16:56.560 --> 0:16:59.920 a fifty basis point rate height to you know, perhap 0:17:00.960 --> 0:17:04.159 bribe them into accepting a more comprehensive safety net. Or 0:17:04.960 --> 0:17:06.880 there are also the possibility we don't get the full 0:17:06.920 --> 0:17:10.280 details today or not sufficient details from the market. It's 0:17:10.320 --> 0:17:12.880 a long summer Togo. The next proper meeting might beti 0:17:13.000 --> 0:17:16.080 September um when we are expecting a bigger right hike. 0:17:16.160 --> 0:17:19.399 But the point areas is that they President Leguard has 0:17:19.400 --> 0:17:21.520 got to deliver on a number of different fronts today 0:17:21.880 --> 0:17:25.680 and a very difficult political backdrop. The chances of it 0:17:25.720 --> 0:17:28.560 all going wrong and telling yields blowing out are clearly 0:17:28.680 --> 0:17:31.160 very high. But she's gonna have to do a very good, big, 0:17:31.240 --> 0:17:33.880 confident job telling is all that everything's gonna be fine. 0:17:34.200 --> 0:17:35.960 Since you brought up the debate over whether we're gonna 0:17:36.000 --> 0:17:38.640 see fifty basis points or twenty five, let's get into 0:17:38.720 --> 0:17:41.000 that a little bit. What is the case for the 0:17:41.119 --> 0:17:44.639 ECB to sort of blow past its guidance and deliver 0:17:44.840 --> 0:17:48.440 a bigger hike. Well, it's not of themselves. Like always, 0:17:48.440 --> 0:17:50.359 they're always getting their own way, and they could really 0:17:50.440 --> 0:17:53.600 step elegantly out this and claim the days dependent and 0:17:54.119 --> 0:17:56.400 but they do that, it means the whole forward guidance 0:17:56.480 --> 0:17:58.680 stick and the whole way they've approached everything up to 0:17:58.760 --> 0:18:01.600 now are very clearly sing things out will be blown 0:18:01.640 --> 0:18:03.320 out the water and it will be embarrassing and also 0:18:03.400 --> 0:18:06.480 would make it seem that President the Garden her chief 0:18:06.480 --> 0:18:09.080 economists Philip Laine, who are more the Dovish irons, have 0:18:09.280 --> 0:18:13.560 been overruled and outvoted. So um Therefore, I think they 0:18:13.640 --> 0:18:15.919 probably will stick with twenty five basis points, even though 0:18:15.960 --> 0:18:18.879 I believe like most people they should go fifty. So 0:18:19.560 --> 0:18:21.800 you know, all to play for here, And as I said, 0:18:21.840 --> 0:18:24.680 it's not the most important thing today is whether the 0:18:24.720 --> 0:18:28.960 word unlimited is used with this antifragrammentation tools. If it's not, 0:18:29.160 --> 0:18:32.639 and it's couched in terms which make it unlikely that 0:18:32.720 --> 0:18:35.040 certain countries will will take it and use it, will 0:18:35.080 --> 0:18:38.120 be allowed to or be changed legally, then the whole 0:18:38.240 --> 0:18:40.399 effect could go unwind and that probably more important than 0:18:40.400 --> 0:18:43.119 whether it's twenty five or fifty. Now last less than 0:18:43.160 --> 0:18:46.480 a minute here, Marcus, what about the energy uncertainty with 0:18:46.640 --> 0:18:50.120 the nord Stream pipeline at least partially getting flows back going. 0:18:50.960 --> 0:18:54.040 How does that factor into whatever the UCV decides. Well, 0:18:54.119 --> 0:18:56.080 it's just am A getting delayed. I mean, I think 0:18:56.119 --> 0:18:58.480 obviously they'll be grateful for that. They won't and shouldn't 0:18:58.520 --> 0:19:00.679 take too much comfort for it. It can turn back 0:19:00.720 --> 0:19:05.000 off again. There's still the turbine sort of refurbishment issue 0:19:05.040 --> 0:19:07.680 to play for. But the moment, it just looks like, 0:19:08.080 --> 0:19:10.440 as as we most people expected a little bit of 0:19:10.480 --> 0:19:13.320 mind games here or game theory going from Russia. They've 0:19:13.400 --> 0:19:15.239 turned I've turned it back on. That's the short term 0:19:15.280 --> 0:19:17.680 good news doesn't mean there will be any chance of 0:19:17.720 --> 0:19:21.160 getting up to proper capacity by the wintertime. It's still 0:19:21.320 --> 0:19:24.760 very much open and to playful. So it's just it 0:19:24.800 --> 0:19:27.040 could have been worse today that it could not have started. 0:19:27.280 --> 0:19:29.760 The fact that has is, I suppose a small good news, 0:19:29.800 --> 0:19:31.399 but an awful lot more to happen. It's gonna be 0:19:31.400 --> 0:19:34.399 a busy day, yeah, busy summer as you alluded to. 0:19:34.560 --> 0:19:37.000 Thank you, Marcus great having gone with us. Marcus Ashworth 0:19:37.040 --> 0:19:40.440 of Bloomberg Opinion. Check out more from our opinion calumnists 0:19:40.480 --> 0:19:42.879 O P. I N Go on the Bloomberg Terminal or 0:19:43.119 --> 0:19:47.320 NI Ashworth Girl see everything. Marcus is contributing as part 0:19:47.359 --> 0:19:50.280 of our team of opinion calumnists on the Bloomberg Terminal. 0:19:50.600 --> 0:19:53.959 Right now, SMP futures little change down a point. Dow 0:19:54.119 --> 0:19:57.040 future is down fifty one, Nastack futures are higher by 0:19:57.160 --> 0:20:00.520 twenty four points ten. Your treasury down five can seal 0:20:00.600 --> 0:20:08.720 three point zero four percent? This is Bloomberg Bloomberg eleven 0:20:08.760 --> 0:20:11.240 three or whether the heat wave continues Heat advisory till 0:20:11.320 --> 0:20:14.680 eight p m. Sunday today. We could see some strong 0:20:14.840 --> 0:20:22.720 storms right now It's eighty degrees in Central Park. Broadcasting 0:20:22.840 --> 0:20:26.520 live from the Bloomberg Interacted Broker Studio in New York. 0:20:26.680 --> 0:20:30.600 Bloomberg E Living Freedom to Washington, d C. Bloomberg one 0:20:30.760 --> 0:20:33.960 to Boston, Bloomberg one, O six one to San Francisco, 0:20:34.040 --> 0:20:37.240 Bloomberg nine sixt to the Country, Sirius XM Till the 0:20:37.320 --> 0:20:40.240 one nine team, and around the globe the Bloomberg Business 0:20:40.320 --> 0:20:44.320 apt and Bloomberg Radio dot Com. This is Bloomberg Daybreak 0:20:50.119 --> 0:20:52.399 six thirty on Wall Street. Good morning, I'm Nathan Hagar, 0:20:52.960 --> 0:20:55.440 but I'm Karen Moscow. We are just about three hours 0:20:55.480 --> 0:20:57.520 away from the open of US trading. Time for the 0:20:57.600 --> 0:20:59.600 five things that you need to notice. Start your day 0:20:59.680 --> 0:21:04.080 bronck to you by Interactive Brokers. Interactive Brokers symbol IBK, 0:21:04.200 --> 0:21:07.000 our Global Trader app. Deposit in your local currency and 0:21:07.080 --> 0:21:09.719 trade stocks in the US, Europe and Asia. Start your 0:21:09.760 --> 0:21:13.680 free trial at ibkr dot com. Slash Global Trader. First 0:21:13.760 --> 0:21:16.560 returned to Italy, where Prime Minister Mario drag has offered 0:21:16.600 --> 0:21:19.480 his resignation to Italy's president. The move comes as the 0:21:19.520 --> 0:21:22.399 European Central Bank is set to raise interest rates today. 0:21:22.680 --> 0:21:26.320 Bloomberg News Senior editor in Italy, Gerald Colton says it 0:21:26.440 --> 0:21:30.200 makes the ECB meeting all the more important. It underscores 0:21:30.359 --> 0:21:33.159 the fragility of countries like Italy. You can see that 0:21:33.240 --> 0:21:37.879 the bond the bond market has closely tracked the stability 0:21:37.960 --> 0:21:40.200 of the draggy government jog. He has been seen as 0:21:40.280 --> 0:21:43.680 the sort of a guarant for of obstability for for 0:21:43.880 --> 0:21:46.840 Italy and for you know, and for the weaker countries 0:21:46.880 --> 0:21:50.119 in in the European Union at large. In reasones the 0:21:50.160 --> 0:21:53.520 States for what's happening today, Bloomberg News Senior editor Gerald 0:21:53.600 --> 0:21:56.760