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Speaker 1: From the Bloomberg Interactive Burgers Studios. This is Bloomberg day

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Speaker 1: Break for Monday, June fit Coming up today.

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Speaker 2: Oil gains after Saudi Arabia pledges to cut supplies by

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Speaker 2: a million.

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Speaker 3: Barrels a day.

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Speaker 1: The dead ceiling deal could set off a flood of

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Speaker 1: borrowing for the Treasury.

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Speaker 2: UBS plans to complete its Credit SUITEE takeover by next week.

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Speaker 3: I my stocks on the cost of a bull market.

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Speaker 1: Morgan Stanley says the rally won't last.

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Speaker 4: Assessn't a plane that was edited to long island crash

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Speaker 4: in Virginia, plus as Ukraine started its counter defensive against Russia.

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Speaker 4: I'm Michael Barner.

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Speaker 5: More Ahead, I'm Don Stansdallen Sports than Miami Heat won

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Speaker 5: Game two of the NBA Finals in Denver. The Yankees

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Speaker 5: top the Dodgers. The Mets lost again to the Blue Jay.

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Speaker 6: That's all straight Ahead on Bloomberg day Break, The Business

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Speaker 6: News You need to sturn your day in just one

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Speaker 6: fifteen minute podcast each morning on Apples, Spotify, the Bloomberg

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Speaker 6: Business app and everywhere you get your podcasts.

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Speaker 7: Good morning, I'm Nathan Hager.

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Speaker 1: And I'm Karen Moscow. Here are the stories. We're following today.

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Speaker 3: Oil is on the rise this morning.

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Speaker 2: That's after Saudi Arabia announced it'll cut supplies by one

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Speaker 2: million barrels a day starting next month. The move takes

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Speaker 2: Saudi crude production to its lowest level in several years.

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Speaker 2: Here's United Arab Emirates Oil Minister Sahail Mohammad alb Musruri.

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Speaker 8: It was a good deal, of a historical deal, and

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Speaker 8: we look forward to monitor the market. But that deal

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Speaker 8: is giving clarity to the market and giving the market's

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Speaker 8: visibility on next seat.

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Speaker 3: And checking all prices.

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Speaker 2: Right now, Nimax screw's up two and a half percent

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Speaker 2: at seventy three dollars fifty one cents a barrel.

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Speaker 1: Well, Nathan back here in the USh. The thread of

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Speaker 1: the government of faulting on its debts is now on

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Speaker 1: hold until after the next presidential election. President Biden has

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Speaker 1: signed the deal with House Speaker Kevin McCarthy. That's a

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Speaker 1: spenser nation's debt ceiling until January of twenty twenty five.

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Speaker 3: This is vital.

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Speaker 9: It's because it's essential to the progress we made over

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Speaker 9: the last few years. Is keeping full faith and credit

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Speaker 9: of the United States of America and passing a budget

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Speaker 9: that continues to grow our economy and reflects our values

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Speaker 9: as a nation.

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Speaker 1: And the President addressed the nation from the Oval Office

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Speaker 1: before signing the bill on Saturday. This gives the Treasury

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Speaker 1: Department the green light to issue more than a trillion

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Speaker 1: dollars in new debt after months of disruption. Bank of

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Speaker 1: America estimates the wave of new issueance could have the

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Speaker 1: same impact as a quarter percent interest rate hike from

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Speaker 1: the Fed by draining liquidity from banks.

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Speaker 2: Speaking of banks, Karen, US regulators are reportedly preparing to

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Speaker 2: force large lenders to shore up their financial footing after

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Speaker 2: this year's regional bank collapses. According to the Wall Street Journal,

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Speaker 2: the changes could raise overall capital requirements at large lenders

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Speaker 2: by roughly twenty percent. The paper says institutions with large

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Speaker 2: trading businesses would take the biggest hit, while those heavily

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Speaker 2: dependent on fee income could also face significant increases.

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Speaker 1: Well in Europe, Nathan, you be expect to complete its

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Speaker 1: tank over of credit sweets as soon as next week

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Speaker 1: and week at the detailser on Bloomberg's Ewan pots in London.

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Speaker 3: Good morning, Ewan, Good morning Karon, Nathan.

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Speaker 10: It has been a tumultuous period for the normally sleepy

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Speaker 10: world of Swiss banking, but now that period is joined

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Speaker 10: to close, as UBS says it's credits Wee takeover could

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Speaker 10: be completed as soon as next Monday. Credits we share

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Speaker 10: holds to receive one UBS chef for every twenty two

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Speaker 10: point eight outsigning shares held. The deal agreed in that

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Speaker 10: dramatic weekend back in March creates a megabank that not

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Speaker 10: only dwarfs every other Swiss lender, it's also double the

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Speaker 10: size of Switzerland's economy in London.

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Speaker 3: I'm you in pot'spom book day Break, ooky Ewan, thank you.

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Speaker 2: Turning to markets now, the sm P five hundred enters

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Speaker 2: the week on the cusp of entering a ball market,

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Speaker 2: a level which would see the index rise twenty percent

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Speaker 2: from it's October low. But Morgan Stanley does not expect

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Speaker 2: this stock rally to last because of a pullback in

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Speaker 2: corporate earnings. In fact, Morgan predicts urnings per share for

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Speaker 2: the SMP will drop sixteen percent this year. That's one

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Speaker 2: of the most bearish predictions among those tracked by Bloomberg.

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Speaker 2: It contrasts with bullish forecasts from the likes of Goldman Sachs,

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Speaker 2: which anticipates mild growth.

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Speaker 1: Well Nathan expect airline revenues to take off. The airline

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Speaker 1: industry's main lobbying body is doubling its estimate for global

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Speaker 1: net profit this year. The International Air Transport Association expects

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Speaker 1: profits to reach nine point eight billion dollars this year.

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Speaker 1: The association expects more than four point three billion passengers

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Speaker 1: to travel this year, and that's around ninety six percent

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Speaker 1: of twenty nineteen levels.

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Speaker 2: Well, one carrier in the US, Karen jet Blue, is

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Speaker 2: weighing its options. It's after a federal judge rule the

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Speaker 2: Northeast alliance between Jet Blue and American Airlines broke anti

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Speaker 2: trust law. The judge ordered the pair to dissolve the

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Speaker 2: arrangement within thirty days. We caught up with Jet Blue

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Speaker 2: CEO Robin Hayes. He talked about a possible problem this

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Speaker 2: busy summer travel season.

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Speaker 11: The biggest challenge that we face in the United States

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Speaker 11: really is air traffic controller staffing, and the FAA has

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Speaker 11: said that air traffic controllers in New York are down

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Speaker 11: to fifty four percent of what they need and as

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Speaker 11: a result of that, we've already had to cut.

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Speaker 2: Flights Jed Blue CEO Robin hayespoke with Bloomberg from the

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Speaker 2: sidelines of the IATA Annual General Meeting in istanbul Well Nathan.

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Speaker 1: Apple is poised to unveil a long rumored headset today.

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Speaker 1: While no product will ever live up to the iPhone,

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Speaker 1: the headset has the potential to usher in a new era.

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Speaker 1: I could have kicked off this shift to a different

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Speaker 1: interface that up ends how people work, play games, and

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Speaker 1: entertain themselves. It's also a risky endeavor that could backfire

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Speaker 1: for Apple. Mixed reality headsets are still a nason field,

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Speaker 1: and many people are hesitant to wear a computer on

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Speaker 1: their face. The Apple device also will have design quirks,

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Speaker 1: such as an external battery pack and a price tag

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Speaker 1: of roughly three thousand dollars.

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Speaker 2: Finally, Karen, financial professionals have a warning for their employers.

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Speaker 2: Don't ask me to come into the office more often,

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Speaker 2: or I'll quit. Bloomberg's latest Markets Life Pulse survey finds

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Speaker 2: about one in two people who work in finance would

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Speaker 2: change jobs or already have if their managers required them

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Speaker 2: to spend more time in the workplace. More than half

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Speaker 2: of responded Star poll globally prefer a hybrid arrangement. Only

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Speaker 2: about twenty percent actually favor working from the office. And

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Speaker 2: it's now time to take a look at some of

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Speaker 2: the other stories making news in New York and around

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Speaker 2: the world with Bloomberg's Michael Barr.

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Speaker 3: Good morning, Michael, Good morning, Nathan.

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Speaker 4: Russia says it thwarted a large Ukrainian attack in the

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Speaker 4: eastern province of Dunesk, though it's unclear if this was

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Speaker 4: the start of a Ukrainian counter offensive. Russian Defense Ministry

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Speaker 4: spokesman igor Kannakenshkov, through a translator, thanks all due.

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Speaker 3: Brat you nicky that neils them.

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Speaker 12: The enemy did not achieve its tasks. It had no

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Speaker 12: success as a result of capable and calculated actions of

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Speaker 12: the Group of Forces East. The Ukrainian army suffered losses

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Speaker 12: of more than two hundred fifty people, sixteen tanks, three

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Speaker 12: armored personnel carriers, and twenty one armored vehicles.

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Speaker 4: Ukraine did not comment assessana plane that was headed to

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Speaker 4: Long Island, New York crashed in Virginia. The wayward plane

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Speaker 4: flew over restricted airspace. In Washington, DC, the Capitol and

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Speaker 4: White House were briefly placed on high alert and f

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Speaker 4: sixteen jet hit supersonic speeds to reach the unresponsive pilot

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Speaker 4: of the Cessna. The F six Singh caused a sonic

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Speaker 4: boom over the Washington, DC area. The private plane ended

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Speaker 4: up crashing over mountainous terrain near Montebello, Virginia. No survivors

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Speaker 4: were found at the wreckage. A small Cessena departed from

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Speaker 4: Tennessee headed to McArthur Airport in Iceland. Hollywood is a

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Speaker 4: step closer to resolving one of its labour issues. Bloomberg's

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Speaker 4: Dan Schwartzmann reports.

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Speaker 13: The Director's Guild of America has reached a tentative agreement

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Speaker 13: on a new contract with the Alliance of Motion Picture

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Speaker 13: and Television Producers, one of the unions that represents Hollywood studios.

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Speaker 13: The deal will include a five percent way increase in

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Speaker 13: the first year, a four percent increase in year two,

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Speaker 13: with the three and a half percent raise in the

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Speaker 13: third year. The agreement also says that generative AI will

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Speaker 13: not be allowed to replace humans. This deal could be

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Speaker 13: used as a benchmark as other industry unions look to

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Speaker 13: finalize their contracts. The agreement will be submitted to the

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Speaker 13: Director's Guild of America National Board at a meeting on Tuesday.

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Speaker 13: Dan Schwarzman Bloomberg Radio. Prince Harry's battle with the British

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Speaker 13: press is headed for a showdown in a London court

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Speaker 13: room this week with the publisher of the Daily Mirror.

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Speaker 13: Harry is scheduled to testify in the High Court after

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Speaker 13: his lawyer presents opening statements today in his case alleging

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Speaker 13: the Mirror unlawfully snooped on him. He'll be the first

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Speaker 13: member of the British royal family to testify in court

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Speaker 13: in more than a century. Global News twenty four hours

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Speaker 13: a day, powered by more than twenty seven hundred journalist

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Speaker 13: nanailists in over one hundred and twenty countries. On Michael Barr,

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Speaker 13: This is.

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Speaker 3: Bloomberg, Nathan, Thank you, Michael.

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Speaker 2: Time now for our Bloomberg Sports date. Good morning, John

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Speaker 2: Stan Shout.

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Speaker 4: Good morning. Eighth.

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Speaker 5: At terrific Game two the NBA Finals in Denver, both

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Speaker 5: the Heat and the Nuggets shot it well. Miami made

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Speaker 5: almost half of its three pointers, Denver over fifty percent

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Speaker 5: over all. Miami up by eleven in the first quarter

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Speaker 5: and then down by fifteen, and Denver was up eight

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Speaker 5: starting the fourth quarter. They were thirty seven and one

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Speaker 5: this season with that big of lead, but Miami went

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Speaker 5: from down eight to up twelve. Nuggets then got it

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Speaker 5: down to three. Miami hung on to win one eleven

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Speaker 5: one oh eight. Denver had won its last seven playoff games.

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Speaker 5: With nine to zero at home, they got another big

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Speaker 5: game from Nicola jok It's forty one points, though no

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Speaker 5: triple double this time. He had only four assists and

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Speaker 5: he had five turnovers. The series title won. Game three

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Speaker 5: is Wednesday in Miami. Yankees and Dodgers scoreless until the seventh.

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Speaker 5: In eight pitcher's duel between Domingo Herman and LA rookie

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Speaker 5: Bobby Miller, Yanks scratched across runs in the seventh and eighth,

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Speaker 5: and then the rookie was up with the ninth.

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Speaker 2: And the lefty ferguson to the plee swinging a deep

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Speaker 2: shot left field, backing up his outman.

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Speaker 3: He's watching it.

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Speaker 5: It is gode the home run.

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Speaker 10: Anthony Vopie goest yard into left field.

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Speaker 13: It hits the bleachers, a two run shot, and some

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Speaker 13: night didn't insurance for the Yankees.

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Speaker 3: Wfan Yx won four to one.

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Speaker 5: They went four and two on the road ship the

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Speaker 5: Mets homestand had that sweep of the Phillies, but then

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Speaker 5: they got swept over the weekend by Toronto, who finished

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Speaker 5: the sweep winning six to four on a Brandon belt

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Speaker 5: to run home run seventh any French Opendovak Djokovic into

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Speaker 5: the quarterfinal, fourteenth in a row for him in Paris.

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Speaker 5: Victor Hoblin won the Memorial Golf in Ohio in a playoff,

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Speaker 5: and twenty year old Rose Zang, the winner of every

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Speaker 5: major amateur tournament, won the LPGA in New Jersey and

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Speaker 5: her pro debuts dashedward.

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Speaker 3: Bloomberg Sports.

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Speaker 6: From coast to coast, from New York to San Francisco,

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Speaker 6: Boston to Washington, DC, nationwide on siriusxam, the Bloomberg Business

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Speaker 6: app in Bloomberg dot com.

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Speaker 3: This is Bloomberg Daybreak. Good morning. I'm Nathan Hager.

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Speaker 2: We head into a new trading week, a little bit

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Speaker 2: more than a week before the next Federal Reserve decision,

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Speaker 2: with the S and P five hundred on the cusp

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Speaker 2: of a bull market and oil prices surging this morning

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Speaker 2: after Saudi Arabia announced it'll cut production by another million

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Speaker 2: barrels a day, following the OPEC plus production cut from

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Speaker 2: earlier this year, let's get this trading week started. We're

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Speaker 2: joined by Dennis Gartman, the former publisher of the Gartment Letter,

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Speaker 2: now chairman of the University of Akron Endowment Investment Committee. Dennis,

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Speaker 2: good morning. I know you've been a little bit more

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Speaker 2: moderately bullish on this market after calling a bear market

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Speaker 2: for just about a year and a half. Now, with

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Speaker 2: the S and P where it is right now, can

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Speaker 2: we call this a new bowl?

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Speaker 14: We have to be very careful because if you take

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Speaker 14: a look at the S and P, what ten of

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Speaker 14: the stocks, A handful of the stocks have been what

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Speaker 14: almost up ninety percent of the valuation, they've about ten

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Speaker 14: percent over the course of the past year, and the

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Speaker 14: other four hundred ninety stocks are down on the year.

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Speaker 14: Out of the S and P five hundred, so you

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Speaker 14: have to be careful. This market, as they commonly say,

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Speaker 14: has bad breadth, so be careful out there. But nonetheless,

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Speaker 14: it's it keeps making new highs. If you just if

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Speaker 14: you're buying the triple queues, the or any of the

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Speaker 14: broad indices, you've done fine. But all of your evaluation

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Speaker 14: has been incorporated in just a handful of stocks. So

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Speaker 14: it's not the it's not the healthiest of all markets,

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Speaker 14: but nonetheless it seems to be a bull market.

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Speaker 2: Do you think that the growth trade, some of the

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Speaker 2: moves that we're seeing into big tech stocks has gotten

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Speaker 2: a little bit crowded or does it have further to run.

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Speaker 14: I'm not sure it's crowded, but it's certainly overdone. Buying

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Speaker 14: the n video what several hundred times annual sales is

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Speaker 14: a little bit beyond Mike can I can't understand it.

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Speaker 14: And as my good friend Gary Shilling once said, markets

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Speaker 14: can remain illogical far longer than you or I can

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Speaker 14: remain solvent. A lot of people are short. I wouldn't

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Speaker 14: be short of those stocks, but I would I clearly

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Speaker 14: would not be a buyer of Nvidia. I would not

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Speaker 14: be a buyer of Microsoft. I would not be a

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Speaker 14: buyer of the high tech. Owning some of the banks

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Speaker 14: makes sense, Owning some of the manufacturers make sense. Maybe

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Speaker 14: even owning some retail makes sense. But owning the high

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Speaker 14: tech stocks that have been on such a tear to

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Speaker 14: the upside, I think that's senseless.

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Speaker 2: Does it make sense to get further breadth into this market?

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Speaker 2: When we get calls from the likes of Andrew Sheets

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Speaker 2: over at Morgan Stanley last night saying that we could

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Speaker 2: see a sixteen percent earnings per share cut for the

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Speaker 2: S and P five hundred that could bring this rally

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Speaker 2: to an end.

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Speaker 14: Well, I think that's a little bit too pessimistic on

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Speaker 14: my part or on his part. I think he's probably

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Speaker 14: ill advised to make that kind of a statement. I

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Speaker 14: think earnings are actually bottoming out rather than topping out,

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Speaker 14: and I think they'll probably be higher in the four

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Speaker 14: hundred and ninety stocks that haven't done very well over

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Speaker 14: the course of the past year, so I think earnings

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Speaker 14: are going to do better. The big question this morning

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Speaker 14: is we Opek having cut or Saudi Arabia having cut

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Speaker 14: a million barrels of krude oil out of its production. Now,

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Speaker 14: Saudi Arabia is going to be producing nine million barrels

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Speaker 14: of crude oil a day. The United States is producing

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Speaker 14: what twelve and a half million barrels. It's pretty amazing

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Speaker 14: to think that we're producing two and a half to

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Speaker 14: three and a half million barrels of more per day

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Speaker 14: than Saudi Arabia, making US far and away the largest

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Speaker 14: producer of crude oil. That I think is the big

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Speaker 14: news of the day.

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Speaker 2: Well, what does that dynamic mean for oil prices going forward?

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Speaker 3: Here?

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Speaker 2: If we do continue to see the US leading in

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Speaker 2: crude production, does that put a floor on oil prices

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Speaker 2: or could we see more of a rally there.

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Speaker 14: We're probably going to end up seeing more of a rally.

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Speaker 14: It's really quite impressively. One thing that has bothered me

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Speaker 14: about the oil market is that the term structure of

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Speaker 14: the futures market has been backwardated, has lost its baquidation

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Speaker 14: excuse me, and has gone to a very slight tentangle

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Speaker 14: in the front end that usually is bearish. But nonetheless,

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Speaker 14: this cut is a bit of surprising. I think the

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Speaker 14: Saudis mean it. I think they intend to stand by

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Speaker 14: that nine million barrel production number instead of ten million

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Speaker 14: barrels of crude oil per day. So probably we're looking

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Speaker 14: at WTI making its way up to eighty five dollars

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Speaker 14: a barrel. We're probably going to see Brent make its

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Speaker 14: way up to ninety dollars a barrel. I think the

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Speaker 14: ball market continues there. It's a little surprising, but nonetheless

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Speaker 14: this is a surprising cut, and I think the Saudi's

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Speaker 14: mean it.

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Speaker 2: We have about a minute left here now that we

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Speaker 2: have resolution with the debt ceiling in Washington, d C.

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Speaker 2: What's the market impact there? What could it mean for treasuries.

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Speaker 14: Well, it's a good thing that the idea of default

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Speaker 14: has been taking off the blackboard completely. That's a step forward,

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Speaker 14: and I think it does a lot of the Federal

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Speaker 14: Reserve Bank the chance to the new term skip the

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Speaker 14: raising rates at the next meeting this week or next week.

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Speaker 14: So I think that that's probably a relatively good thing.

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Speaker 14: But we're going to end up seeing at the short

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Speaker 14: end of the curve slightly higher rates. I own a

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Speaker 14: lot of two years. I'm comfortable owning a lot of

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Speaker 14: two years. I wish I'd waited to buy them until

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Speaker 14: today or tomorrow, but nonetheless, I'm comfortable owning a lot

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Speaker 14: of two years. At this point, the Yeld curve seems

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Speaker 14: to be wanting to go to an even larger inversion,

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Speaker 14: and I think at the long end of the curve,

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Speaker 14: avoiding purchases and beyond the five years and probably makes

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Speaker 14: sense to me for a while.

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