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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: This is the Blue Big Day Bake podcast, available every

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Speaker 2: morning on Apple, Spotify or wherever you listen. It's Friday,

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Speaker 2: the seventh of March in London. I'm Caroline HIPKIF and.

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Speaker 3: I'm Stephen Carroll. Coming up today. Beijing blasts Trump as

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Speaker 3: two faced. China's foreign minister delivers a broadside at the

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Speaker 3: US president as tensions rise.

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Speaker 2: Reversing course for now, Trump delays a large portion of

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Speaker 2: his administration's new tariffs on Mexico and Canada.

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Speaker 3: Plus shaky sentiment, markets remain unconvinced by Trump's latest move

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Speaker 3: on levies as the Nasdak nears correction territory.

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Speaker 2: Let's start with a roundup of our top stories.

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Speaker 3: China's top diplomat has attacked President Trump's approach to China

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Speaker 3: and Tariff's Foreign Minister Wangiya said on the sidelines of

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Speaker 3: the National People's Congress of the US shouldn't return good

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Speaker 3: with evil. His words are spoken by a translator.

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Speaker 4: Mutual respect is a basic government state to state relations.

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Speaker 4: He is also an important for China US relations. No

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Speaker 4: country should fantasize that it can suppress China and maintain

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Speaker 4: good relations with China. At the same time, are not

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Speaker 4: good for the stability of lateral relations or for building

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Speaker 4: mutual trust.

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Speaker 3: Wang, a veteran diplomat, defended his country's actions on stemming

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Speaker 3: the flow of fentanyl to the United States and accused

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Speaker 3: Trump of using the issue as a pretext to pressure

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Speaker 3: the government. It marks a change in tone from China,

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Speaker 3: which had met this week's increase in US tariffs with

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Speaker 3: targeted actions.

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Speaker 2: President Trump, though, has delayed tariffs on goods from Mexico

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Speaker 2: and Canada covered by the North American Trade Agreement until

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Speaker 2: the second of April. The move to exempt at least

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Speaker 2: half of all goods from the new twenty five percent

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Speaker 2: levies offers a major reprieve to America's two largest trading partners,

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Speaker 2: who had signed the trade agreement with Trump in his

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Speaker 2: first term. We get more now from our senior policy

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Speaker 2: analyst from Blueberg Intelligence, Nathan Dean.

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Speaker 5: We're coining this a shock and oars strategy for tariffs,

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Speaker 5: where President Trump comes out here and says, look, this

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Speaker 5: is what I'm going to do. It's going to happen.

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Speaker 5: I'm not going to negotiate. And we saw this with Canada, Mexico,

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Speaker 5: tariffs are on, thirty day extension tariffs are on. Now

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Speaker 5: we're seeing the exemption from Mexico, so come April second,

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Speaker 5: which is the next major catalyst. Obviously there's potentially some

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Speaker 5: negotiations with Canada to go between then.

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Speaker 2: Nathan Dean pointing to the latest development in a frenzied

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Speaker 2: week that began with President Trump applying across the board

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Speaker 2: tariffs on Canada and Mexico, as well as doubling tariffs

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Speaker 2: on China to twenty percent.

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Speaker 3: The headlines on tariff sparked intense, quick and sharp swings

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Speaker 3: on the stock market and losses across the board. By

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Speaker 3: the end of the trading session on Wall Street, the

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Speaker 3: S and P five one hundreds slid by one point

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Speaker 3: eight percent, the NASDAK dropped by two point eight percent,

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Speaker 3: despite some tariff relief for Canada and Mexico. Speaking to

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Speaker 3: reporters in the Oval Office, President Trump was asked why

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Speaker 3: markets seemed so spooked by tariffs.

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Speaker 6: Well, a lot of them are globalist countries and companies

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Speaker 6: that won't be doing as well because we're taking back

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Speaker 6: things that have been taken from us many years ago.

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Speaker 6: We've been treated very unfairly as a country we protect everybody,

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Speaker 6: We do everything for all these countries, and a lot

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Speaker 6: of these are globalist in nature.

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Speaker 3: Trump's comments came as the NASDAK neared correction territory falling

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Speaker 3: by nine point six percent since its record high in February.

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Speaker 3: Crypto assets also dropped as Trump's executive order creating a

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Speaker 3: strategic bitcoin reserve fell short of industry expectations.

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Speaker 2: Volatile markets have been proving tricky for hedge funds to navigate,

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Speaker 2: with several top funds posting lack loss of a time

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Speaker 2: turns in February. Bloomberg's Human Pots has the details.

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Speaker 7: Analysts that JP Morgan say the volatility in late January

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Speaker 7: that persisted into February drove lots of questions around hedge

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Speaker 7: fund performance as market generations reverse momentum on key trade

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Speaker 7: and clobbered popular stocks, including many of the Magnificent Seven, Millennium, Citadel,

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Speaker 7: and other top hedge funds reported soggy returns during the month.

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Speaker 7: Bloomberg understands Jane Global fell about one percent, Millennium lost

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Speaker 7: one point three percent, and Citadel one point seven percent.

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Speaker 7: Losses were driven by overcrowding in a small group of

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Speaker 7: US stocks, particularly healthcare and technology hedge funders will be

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Speaker 7: hoping that this month doesn't see a repeat of what

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Speaker 7: JP Morgan called February's pockets of painful performance. I'm new

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Speaker 7: and pots Bloomberg Radio.

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Speaker 3: E leaders back to plan to reform their fiscal rules,

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Speaker 3: echoing Germany's defense push and potentially unlocking trillions of euros.

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Speaker 3: The spending serage comes as the continent comes to grips

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Speaker 3: with its vulnerability without American security guarantees. Defense officials heel Bloomberg,

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Speaker 3: a Russian invasion would breach frontlines in weeks without US support.

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Speaker 3: Francis President Emmanuel Macrar is a key voice calling for

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Speaker 3: re armament.

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Speaker 8: Sete jaku kuntu nudl manaci quaki that'd given the threat

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Speaker 8: and whatever happens in Ukraine, we need to increase our

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Speaker 8: defense capabilities and we need to build in the next

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Speaker 8: few years autonomous defense capabilities for Europeans.

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Speaker 3: Macrl has been trying to coordinate a European effort to

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Speaker 3: organize the Ukraine peace deal. European sources say President Donald

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Speaker 3: Trump wants to link his proposed US Ukraine minerals deal

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Speaker 3: to demands for Kiev to commit to a quick ceasefire

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Speaker 3: with Russia.

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Speaker 2: The European Central Bank is heading for tough negotiations as

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Speaker 2: policymakers differ strongly on where interest rates go next. The

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Speaker 2: ECB cut its base rate to two and a half

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Speaker 2: percent yesterday, as was widely predicted, but with a global

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Speaker 2: trade will brewing in trillions of euros being earmarked for

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Speaker 2: defense spending, both markets and policymakers are unsure whether to

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Speaker 2: cut interest rates further or hold steady. President Christine Laguard

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Speaker 2: relied on a central banker stock phrase when answering questions

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Speaker 2: about the outlook.

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Speaker 1: The collective view around the table is that we do

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Speaker 1: not precomit to a path and we will be as

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Speaker 1: ever and probably more so, data dependent.

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Speaker 2: Christine Lagard, that are talking about data dependency. She added

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Speaker 2: that the backdrop is changing dramatically day by day. The

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Speaker 2: year extended gains to hit the days high, while bonds

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Speaker 2: fell Following the ECB's statement.

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Speaker 3: The UK's Chancellor Rachel Reeves says welfare reforms are needed

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Speaker 3: to balance her budget. Downgraded growth forecasts and higher borrowing

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Speaker 3: costs of left Britain's government searching for more money. Head

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Speaker 3: of the Chancellor of Spring statement on the twenty sixth

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Speaker 3: of March. Reeves says the welfare system has to change

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Speaker 3: at the moment.

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Speaker 9: It's letting down tax players, letting down our economy because

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Speaker 9: there's too many people trapped on out of work benefits,

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Speaker 9: and it's letting down the people who are recipients of

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Speaker 9: benefits because they are trapped on benefits rather than actively

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Speaker 9: supported back into work.

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Speaker 3: The ch answer rachelieves they're speaking to Sky Newses Electoral

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Speaker 3: Dysfunction podcast. The Chancellor doubled down on her election pledge

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Speaker 3: not to raise income tax, national insurance or VAT.

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Speaker 2: Those are our top stories for you this morning. Now.

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Speaker 2: In terms of the markets, tarif uncertainty has really weighed

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Speaker 2: on the Wall Street session yesterday, and that continues into

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Speaker 2: Asia also with a Chinese official blasting the United States

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Speaker 2: for its policies. Looking at THEMSCI Asia Pacific indexites down

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Speaker 2: nine tenths of one percent, the cside three hundred dropping

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Speaker 2: three tens across the board, losses, the K two two

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Speaker 2: five by two point two percent, the S and P

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Speaker 2: five hundred heading towards a third straight week of losses,

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Speaker 2: down three point six percent for this week so far,

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Speaker 2: magnificent seven shares below the two hundred day moving average.

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Speaker 2: The euro dollar euro has rallied significantly this week, and

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Speaker 2: we're up two tents this morning, twenty one to what

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Speaker 2: zero eight zero nine. European stock futures this morning are

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Speaker 2: down almost one four percent, and we have the US

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Speaker 2: non van paywalls dated to come and a speech from

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Speaker 2: Jerome pal So we'll look at those jobless figures a

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Speaker 2: bit later.

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Speaker 3: Well, in a moment, we'll bring you the latest on

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Speaker 3: how the latest moves from Donald Trump on tariffs's playing

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Speaker 3: out across market. But another story that caught our eye

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Speaker 3: this morning. I mean, if you're not worried about war,

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Speaker 3: for example, by some of our reporting, perhaps you're worried

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Speaker 3: more immediately about your retirement.

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Speaker 2: Do you get a retirement these days?

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Speaker 3: Well exactly, I mean that's the question that the survey

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Speaker 3: out of the United States is looking at. The shrinking

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Speaker 3: number of people that are actually expecting to retire on time,

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Speaker 3: and millions of Americans planning to extend their full time

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Speaker 3: work or part time workers simply never retire. This is

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Speaker 3: according to a report from the trans America Institute. Six

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Speaker 3: percent of workers who aren't self employed plan to retire

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Speaker 3: at seventy or older, more than half of those surveys,

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Speaker 3: so they plan to work in retirement.

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Speaker 2: Yeah, that's great. I think if you've got an interesting job,

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Speaker 2: if you enjoy your job and maybe it brings you,

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Speaker 2: you know, a social life or interest and intellectual simulation,

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Speaker 2: that's super. But unfortunately cynical. A lot of people in

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Speaker 2: the UK, when you look at the surveys, don't often

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Speaker 2: enjoy their job. So I think that's tricky, isn't it.

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Speaker 3: Yeah, it's gonna be interesting, and I mean part of

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Speaker 3: this also is a financial question too. The you know,

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Speaker 3: if you look at how pension funds have performed in

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Speaker 3: the US versus the UK, the US funds have performed

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Speaker 3: much better over the past ten years, growth of around

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Speaker 3: six percent. In the UK, pension assets as a total

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Speaker 3: have actually been shrinking on average over the past ten years,

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Speaker 3: so perhaps financially the decision making process might be a

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Speaker 3: little bit different as well.

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Speaker 2: Yeah. Absolutely, that feels like something for my generation, definitely. Okay,

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Speaker 2: So that's one interesting story that we've been thinking about today.

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Speaker 2: But we should also look at the market reaction to

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Speaker 2: the latest tariff headlines. Ronald Trump has delayed levies on

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Speaker 2: Mexico and Canada. Our market's Live strateges. Mary Nicola joins

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Speaker 2: us now for more. Mary, good morning. Should we still

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Speaker 2: of the equity markets? Talk us through what happened on

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Speaker 2: Wall Street yesterday as that news emerge, you know, such

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Speaker 2: quick changes on the Trump administration. How is it also

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Speaker 2: playing out in Asia today?

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Speaker 10: Yeah, I think that's where the problem comes in, is

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Speaker 10: the quick changes that we've been seeing, and so equity

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Speaker 10: markets are just showing signs of frustration given the ways

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Speaker 10: that we've seen in trade policies and the abrupt changes.

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Speaker 10: So it's just adding to the volatility, and there's also

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Speaker 10: the lack of clarity that's keeping investors on edge. But

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Speaker 10: then you're seeing this dischotomy coming through where that you're

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Speaker 10: seeing an expansion of fiscal policy in Europe and in China,

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Speaker 10: and that's setting it apart from the US and especially

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Speaker 10: highlighting that the US may actually be worse off than

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Speaker 10: the rest of the world.

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Speaker 3: Talk to us about how this is playing out in

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Speaker 3: tech shares in particular, because if we're looking at the

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Speaker 3: NASA on the verge of a correction.

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Speaker 10: Now, yeah, we have to remember how much investors were

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Speaker 10: in love with tech shares for so long, and how

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Speaker 10: valuations are quite expensive, So now that the resilience of

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Speaker 10: the US economy is coming into question, people are wondering

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Speaker 10: whether it's worth it holding these expensive stocks. So that's

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Speaker 10: going to continue to weigh on US tech. And of

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Speaker 10: course what's happening in the US on the policy front

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Speaker 10: is promoting portfolio diversification, and we're likely to continue to

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Speaker 10: see that, especially with how valuations are still quite expensive.

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Speaker 2: The relief from tariffs it did help to boost the

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Speaker 2: Mexican and Canadian currencies. We've also seen the Bloomberg Dollar

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Speaker 2: Spot index weekening for a fifth day in a row.

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Speaker 2: What's it doing to the currency story?

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Speaker 10: Yeah, I think one thing that's become quite clear is

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Speaker 10: that we're just going to see heightened volatile especially in

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Speaker 10: the likes of the Mexican peso and Canadian and the

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Speaker 10: Canadian dollar, because as we're seeing is that all these

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Speaker 10: headlines are causing a knee jerk reaction. So on top

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Speaker 10: of that, the Canadian currency is also going to be

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Speaker 10: could have another could face another challenge with its own

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Speaker 10: jobs report later today, So forecasts are projecting an increase

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Speaker 10: in the unemployment rate, which of course may signal more

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Speaker 10: easing from the Central Bank next week. And that adds

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Speaker 10: to the pressure on the Canadian dollar.

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Speaker 3: Yeah, indeed, I mean that payrolls report going to be

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Speaker 3: an interesting one to watch as well. Of course, always

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Speaker 3: a kind of key metric for markets to watch. But

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Speaker 3: in this moment of I suppose so much volatility elsewhere,

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Speaker 3: what are the sort of expectations we have around to

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Speaker 3: what we're expecting to see in the payrolls report.

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Speaker 10: Yeah, so they're expecting a softer forecasts are for a

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Speaker 10: softer payrolls report, and of course that is going to

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Speaker 10: be especially in focus with the narrative on you exceptionalism

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Speaker 10: heavily questioned. So the labor report is either going to

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Speaker 10: nullify it or verify it. And I think it would

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Speaker 10: be premature to make a determination on one month of data,

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Speaker 10: considering if we look back at the three month average

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Speaker 10: on hiring up to January, that's been pretty strong. But

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Speaker 10: there are clear headwinds that are emerging for stocks, and

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Speaker 10: given how vulnerable sentiment is right now, I think what

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Speaker 10: if we do see a soft payroll number, it would

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Speaker 10: just exacerbate the recent moves.

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Speaker 2: Okay, Also a word on bitcoin then trading around the

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Speaker 2: eighty eight thousand dollars mark, taking a hit over the

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Speaker 2: disappointment about President Trump's plans and the administration's plans for

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Speaker 2: a strategic stoppa of the cryptocurrency. What was the disappointment.

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Speaker 10: Yeah, it was actually interesting to see the market reaction

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Speaker 10: because in many ways it actually could provide a long

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Speaker 10: term support because the bitcoin initially slid in response to

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Speaker 10: the executive order first bitcoin reserve, but it may but

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Speaker 10: the government is still able to buy bitcoin in the

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Speaker 10: future as long as it's budget neutral. So on the

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Speaker 10: back of that, it's not saying that it's not going

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Speaker 10: to buy anymore. It's just said as long as it's

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Speaker 10: budget neutral. But I also think it provides further credibility

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Speaker 10: to bitcoin with government support, which I think should actually

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Speaker 10: be a long term positive.

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Speaker 3: Okay, Mary Nicola, our Market's Life strategist, thank you very

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Speaker 3: much for joining us with all of those market moving stories.

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Speaker 3: Of course, the tariff story so central to what's been

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Speaker 3: happening in markets over the past number of weeks and

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Speaker 3: very interesting to just reflect for a moment on the

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Speaker 3: comments that we had out of the Chinese Foreign Ministry

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Speaker 3: Wangi talking about defending his country's actions on stemming the

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Speaker 3: flow of fentanyl to the US. This is of course

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Speaker 3: one of the key complaints that Donald Trump has, but

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Speaker 3: using some really strong language when it comes to how

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Speaker 3: Donald Trump is approaching the relationship with Chili.

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Speaker 2: Yeah, absolutely, calling the actions to face and effectively a pretext,

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Speaker 2: using fentanyl as a pretext to impose tariffs. The US

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Speaker 2: shouldn't return good with evil, that's a direct quote, or

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Speaker 2: even impose arbitrary tariffs on Chinese products. This from the

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Speaker 2: Foreign Minister Wang Yi. He is a veteran diplomat, he

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Speaker 2: is obviously well known. This is also a major form

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Speaker 2: so it does seem like a quite a deliberate change

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Speaker 2: in tone and rhetoric. You know, we've been talking about

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Speaker 2: how measured the Chinese government has been in the response

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Speaker 2: to tariffs that were implemented. I'll remind you only at

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Speaker 2: the start of this week the additional tariffs from the

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Speaker 2: Trump administration, and this was at the National People's Congress,

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Speaker 2: which is the major political gathering of the year.

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Speaker 3: And while we've seen this flurry of diplomatic activity from

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Speaker 3: Mexico and Canada to try and delay or to ease

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Speaker 3: some of those tariff threats, we haven't it's worth pointing

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Speaker 3: out seen those talks taking place for between China and

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Speaker 3: the US. Trumpet signal this desire to speak with President

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Speaker 3: Shootingking before that first wave of tarists kicked in, but

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Speaker 3: they haven't had a call since the US leader return

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Speaker 3: to office. This is Bloomberg Daybreak Europe, your morning brief

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Speaker 3: and beyond.

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