WEBVTT - Bloomberg Daybreak: May 31, 2022 - Hour 1 (Radio) 0:00:02.440 --> 0:00:05.920 Live from the Bloomberg Interacted Brooker Studios. Is Bloomberg day 0:00:05.920 --> 0:00:10.720 Break for Tuesday one coming up this hour. Oil surges 0:00:10.760 --> 0:00:13.520 after EU leaders agree to pursue a partial bed on 0:00:13.640 --> 0:00:16.599 Russian crude. The oil game and hawkish comments from the 0:00:16.640 --> 0:00:19.880 Fed have treasury yields on the rise. At President Biden 0:00:19.960 --> 0:00:22.480 holds a rare beating with FED Chair J Powell at 0:00:22.520 --> 0:00:25.919 the Oval Office. Today, people in Voldi, Texas prepared to 0:00:25.920 --> 0:00:28.960 bury the dead from last week's shootings. Plus the Diocese 0:00:29.040 --> 0:00:32.760 of Brooklyn calls it a brazen crime of disrespect and hate. 0:00:33.000 --> 0:00:36.400 I'm Michael bar More Ahead, I'm trying stas and sports. 0:00:36.400 --> 0:00:39.160 The Rangers beat the Hurricanes in Game seven. They're moving 0:00:39.240 --> 0:00:43.480 on to the East Finals. Easy win for the Mets. 0:00:44.479 --> 0:00:48.400 That's all s Trady Ahead on Bloomberg Daybreak on Bloomberg eleven, 0:00:48.440 --> 0:00:52.960 Free on New York, Bloomberg one, Washington, d C, Bloomberg 0:00:52.960 --> 0:00:56.680 one oh six one, Boston, Bloomberg nine sixties, San Francisco, 0:00:57.160 --> 0:01:00.840 Syrius XM one nineteen and around the world on Bloomberg 0:01:00.960 --> 0:01:08.320 Radio dot Com and via The Bloomberg Business. Good Morning, 0:01:08.319 --> 0:01:11.400 I'm Nathan Hager and I'm Karen Moscow We are coming 0:01:11.480 --> 0:01:13.640 up to five oh one on Wall Street, and we 0:01:13.760 --> 0:01:16.200 check the markets every fifteen minutes throughout the trading day. 0:01:16.280 --> 0:01:19.440 On Bloomberg right now is in p Futures are little change. 0:01:19.520 --> 0:01:23.160 DALN features down forty two and NASDAG features have about 0:01:23.319 --> 0:01:26.520 thirty and the jacks in Germany is down about a 0:01:26.600 --> 0:01:29.920 third of a percent. The ten year treasury is down 0:01:30.480 --> 0:01:33.120 thirty seconds, yield two point eight two percent, and the 0:01:33.280 --> 0:01:36.039 yield on the two year two point five four percent. 0:01:36.520 --> 0:01:39.320 The euro is at one point oh seven to eight 0:01:39.360 --> 0:01:41.800 against the dollar, the yen one twenty seven point nine 0:01:41.880 --> 0:01:45.279 three Bitcoin at thirty one thousand, six hundred dollars. Nathan, 0:01:45.360 --> 0:01:48.720 The Karen oil is on the rise this morning. Watching 0:01:48.920 --> 0:01:51.920 nimex crewde It's up three point three percent to a 0:01:52.000 --> 0:01:54.960 hundred eighteen dollars eighty seven cents of barrel. Brent is 0:01:55.040 --> 0:01:57.120 hired by one and a half percent at a hundred 0:01:57.160 --> 0:02:00.000 twenty three dollars fifty three cents. The gains cob after 0:02:00.120 --> 0:02:03.600 European Union leaders agreed to seek a ban on imports 0:02:03.640 --> 0:02:06.600 of most Russian oil. Let's get the details live from 0:02:06.640 --> 0:02:09.120 bloombergs You and parts joining us from our London bureau 0:02:09.160 --> 0:02:11.840 you and good morning, Good morning Nathan and Karen. Finally 0:02:11.960 --> 0:02:15.639 a deal on Russian oil. European Union leaders agree sanctions 0:02:15.680 --> 0:02:18.720 blocking the purchase of crude oil and petroleum products from 0:02:18.800 --> 0:02:22.280 Russia delivered by sea, but there is a temporary exemption 0:02:22.320 --> 0:02:25.520 for pipeline deliveries to satisfy Hungary, which have been holding 0:02:25.600 --> 0:02:30.760 up discussions. European Commissioned President Vonderline welcome the agreement. Council 0:02:30.840 --> 0:02:34.440 should now be able to finalize a van on almost 0:02:35.560 --> 0:02:38.360 of all Russian oil inputs by the end of the year. 0:02:39.120 --> 0:02:42.160 European Commission President Vondeline made the comments out of briefing 0:02:42.200 --> 0:02:44.960 in Brussels. In London, Ami and part Spoon Bay day break, 0:02:45.160 --> 0:02:47.080 are you and thank you all? Back here in the US, 0:02:47.160 --> 0:02:50.280 the followed from last week's school shooting continues to reverberate 0:02:50.320 --> 0:02:53.800 across the country. There's another push for legislation on guns 0:02:53.840 --> 0:02:56.400 for President Biden says he is limited on what he 0:02:56.440 --> 0:02:59.400 can do. He traveled to Vivaldi, Texas for an emotional 0:02:59.520 --> 0:03:02.520 visitor shul weekend. Any Morris has details from our Bloomberg 0:03:03.280 --> 0:03:06.880 newsroom in Washington. I can't outlaw a weapon, I can't 0:03:07.000 --> 0:03:10.120 change a background check. President Biden, explaining that there is 0:03:10.160 --> 0:03:12.480 only so much he can do to stop mass shootings 0:03:12.480 --> 0:03:15.639 in the US. Biden and First Lady Jill Biden visited 0:03:15.639 --> 0:03:19.040 the Texas elementary school where a gunman killed nineteen children 0:03:19.080 --> 0:03:22.200 and two teachers. That shooting has increased demands on Congress 0:03:22.240 --> 0:03:24.960 to do something about gun regulation, and talks in the 0:03:24.960 --> 0:03:27.960 Senate now center on red flag laws. They allow police 0:03:28.040 --> 0:03:30.760 or family members to ask a court to temporarily remove 0:03:30.840 --> 0:03:33.160 the right to own firearms from someone who may be 0:03:33.240 --> 0:03:36.320 at risk. In Washington, I may be Morris Bloomberg, daybreak, 0:03:36.360 --> 0:03:39.080 All right, Amy, thank you on Wall Street today. Inflation 0:03:39.200 --> 0:03:42.560 continues to be a major focus for markets. Treasury yields 0:03:42.560 --> 0:03:45.400 our climbing as the Federal Reserve shows no sign of 0:03:45.520 --> 0:03:49.000 slowing its hawkish stance. FED Governor Christopher Waller says he 0:03:49.040 --> 0:03:51.600 wants to keep raising interest rates in half percentage point 0:03:51.640 --> 0:03:56.640 steps until inflation is under control, support ten policy by 0:03:56.680 --> 0:04:01.920 another fifty basis points for several meetings. In particular, I 0:04:01.960 --> 0:04:06.600 am not taking fifty basis points basis point heights off 0:04:06.640 --> 0:04:10.360 the table. U shall I see inflation coming down closer 0:04:10.440 --> 0:04:14.480 to FED Governor Christopher Waller spoke at an event hosted 0:04:14.480 --> 0:04:18.200 by the Institute for Monetary and Financial Stability. Well, inflation 0:04:18.240 --> 0:04:20.920 don't be a key topic of discussion when President Biden 0:04:20.960 --> 0:04:23.039 holds a rare meeting today with its share of the 0:04:23.040 --> 0:04:26.000 Federal Reserve, and we get more from Bloomberg's Done Chrisner. 0:04:26.320 --> 0:04:29.080 It'll be the first meeting between the two since November, 0:04:29.120 --> 0:04:32.080 when the President nominated J. Powell for a second four 0:04:32.160 --> 0:04:35.840 year term. In the intervening period, soaring inflation has become 0:04:35.880 --> 0:04:39.360 a crippling problem. In an opinion piece published late Monday 0:04:39.360 --> 0:04:41.599 in The Wall Street Journal, the President said he would 0:04:41.640 --> 0:04:44.440 support the FED in its effort to combat high inflation 0:04:44.680 --> 0:04:47.839 by reducing demand. The President said the fight was likely 0:04:47.880 --> 0:04:50.239 to slow the rate of job growth from a monthly 0:04:50.279 --> 0:04:53.800 pace of five hundred thousand jobs to around a hundred 0:04:53.800 --> 0:04:56.880 fifty thousand in New York. I'm Doug Chrisner, Bloomberg Day Break. 0:04:56.960 --> 0:04:59.159 All right, Doug, thank you. The labor market will also 0:04:59.200 --> 0:05:00.919 be front and center this week when we get the 0:05:00.920 --> 0:05:03.560 May jobs report on Friday. Let's get a preview of 0:05:03.560 --> 0:05:07.119 that from Bloomberg's Vinny del Judaicce economists a payroll growth 0:05:07.160 --> 0:05:10.760 probably exceeded three hundred thousand and May. So far this year, 0:05:10.800 --> 0:05:13.600 the economy has added more than two million jobs, with 0:05:13.760 --> 0:05:17.280 labor shortages at record levels. A slowdown could imply a 0:05:17.400 --> 0:05:22.000 shortage of qualified workers rather than sudden weakness. Job cuts 0:05:22.000 --> 0:05:24.880 have been running it half century lows. Also in this 0:05:24.920 --> 0:05:28.440 week's US data calendar, I s M Factory Data, the 0:05:28.440 --> 0:05:31.760 Conference Sports Consumer Confidence Index, and the Federal Reserves bag 0:05:31.880 --> 0:05:36.039 Book Economic Survey, Benny Dell, Judace bloom Birthday break All right, Vinnie, 0:05:36.040 --> 0:05:38.760 thank you. We're also getting key inflation data out of Europe. 0:05:38.760 --> 0:05:41.920 The numbers crossed just a few minutes ago, showing Eurozone 0:05:41.920 --> 0:05:45.720 inflation accelerated to a fresh all time high. Consumer prices 0:05:45.760 --> 0:05:48.279 jumped eight point one percent from a year earlier in May, 0:05:48.320 --> 0:05:50.880 exceeding the seven point eight percent median estimate in a 0:05:50.880 --> 0:05:54.200 Bloomberg survey. The acceleration was driven by food and energy 0:05:54.240 --> 0:05:57.600 after Russia's invasion of Ukraine sent commodity prices soaring. But 0:05:57.720 --> 0:05:59.840 back here in the US, care and stocks are coming 0:06:00.120 --> 0:06:02.440 their first winning week and nearly a month. As we 0:06:02.520 --> 0:06:05.520 returned to this holiday shortened trading week. We get more 0:06:05.520 --> 0:06:09.440 on the days ahead from Bloomberg's Charlie Pellet. Analysts remain 0:06:09.600 --> 0:06:12.840 split on whether equities have found a bottom amid ongoing 0:06:12.960 --> 0:06:17.280 questions about the strength of corporate earnings. Alicia Levine's head 0:06:17.279 --> 0:06:21.159 of Equities and Capital Markets Advisory at Bank of New York, Melon, 0:06:21.520 --> 0:06:23.960 margins are going to come down. And what the market 0:06:24.000 --> 0:06:26.760 has really been grappling with the last couple of weeks 0:06:26.800 --> 0:06:29.720 is the E on the pe their earnings component. And 0:06:30.000 --> 0:06:33.679 it's likely that earnings have to soften from here. Among 0:06:33.720 --> 0:06:38.480 the names scheduled to report this week, Broadcom, CrowdStrike, Hormel, Foods, 0:06:38.640 --> 0:06:42.720 HP and Ko, Lulu, Lemon, and Salesforce dot Com in 0:06:42.800 --> 0:06:46.000 New York. Charlie Pellet, Bloomberg day Break. All right, Charlie, 0:06:46.000 --> 0:06:48.520 thank you well overseas this morning, Shares a UNI lever 0:06:48.800 --> 0:06:52.560 of more than six percent. Activist investor and Nelson Pellets 0:06:52.600 --> 0:06:55.839 has been appointed as a non executive director on the company, 0:06:56.200 --> 0:06:58.520 and his tri And Fund Management has taken at one 0:06:58.560 --> 0:07:01.560 point five percent. Steak Annal Labor All right. Looking ahead 0:07:01.560 --> 0:07:05.599 of the market open, Karen futures are little changed. Mostly 0:07:05.720 --> 0:07:08.320 SMP futures down eight point, STOUT futures down seventy five. 0:07:08.400 --> 0:07:11.040 Nasdaq futures little change. They're higher by nine points. The 0:07:11.080 --> 0:07:15.080 tenure Treasury yield two point eight two percent. Straight ahead 0:07:15.160 --> 0:07:18.239 your latest local headlines in the check of sports. This 0:07:18.560 --> 0:07:24.840 is Bloomberg at south five oh seven on Wall Street. 0:07:24.840 --> 0:07:27.400 Where's seventy four degrees in Central Park already and already 0:07:27.400 --> 0:07:30.480 dealing with an accident northbound Daku Turnpike on the exit 0:07:30.520 --> 0:07:32.360 thirteen off ramp. We'll get the details for you in 0:07:32.400 --> 0:07:35.120 traffic shortly. First, Michael Bars here with more on what's 0:07:35.160 --> 0:07:37.640 going on in New York and around the world. Good morning, Michael, 0:07:37.720 --> 0:07:40.840 Good morning Nathan. Police say someone busted into the altar 0:07:41.000 --> 0:07:44.480 at a New York City church, stole a two million 0:07:44.560 --> 0:07:48.000 dollar gold relic, and remove the head of a statue 0:07:48.040 --> 0:07:51.400 of an angel. The incident happened between Thursday and Saturday 0:07:51.440 --> 0:07:55.840 at St. Augustine's Roman Catholic Church in Brooklyn Spark Slope neighborhood. 0:07:56.080 --> 0:07:59.000 The church was closed for construction at the time. The 0:07:59.080 --> 0:08:02.440 church's pastors had the camera. Recordings from the security system 0:08:02.480 --> 0:08:05.720 were also stolen. The Diocese of Brooklyn called it a 0:08:05.760 --> 0:08:09.960 brazen crime of disrespect and hate. New York Governor Kathy 0:08:10.000 --> 0:08:13.880 Hokol delivered comments yesterday at the commemoration of the twentieth 0:08:13.880 --> 0:08:18.239 anniversary of the formal end of recovery operations at Ground zero, 0:08:18.680 --> 0:08:22.440 Local referred to those who quote showed up unprompted to 0:08:22.520 --> 0:08:25.560 help the common denominator from most as they were New Yorkers, 0:08:26.160 --> 0:08:28.760 because it's in our DNA. When we get knocked down, 0:08:29.480 --> 0:08:32.240 we fight back and we come back, and we must 0:08:32.320 --> 0:08:35.920 never ever forget that lesson. That is the story of 0:08:36.000 --> 0:08:40.120 this hellowed ground. Governor hocol also says we're going to 0:08:40.160 --> 0:08:43.040 come back after this pandemic because we showed we did 0:08:43.080 --> 0:08:46.720 it twenty years ago. Funerals take place this week for 0:08:46.760 --> 0:08:51.040 the nineteen children and two teachers killed last week in Uvaldi, Texas. 0:08:51.520 --> 0:08:54.199 The town's mayor Don mclockman says the site of the 0:08:54.200 --> 0:08:58.000 shooting rob Elementary School should be torn down. McLoughlin says, 0:08:58.040 --> 0:09:00.760 though people in the community will get through it. That's 0:09:00.800 --> 0:09:02.280 one of the things I love about you about it. 0:09:02.360 --> 0:09:05.240 This community will come together and we will come together 0:09:05.320 --> 0:09:07.800 on this. I mean, this is something that we will 0:09:07.840 --> 0:09:12.480 never get over, but we'll get through it. Mayor McLaughlin 0:09:12.559 --> 0:09:16.079 says he supports the construction of a mental health hospital 0:09:16.160 --> 0:09:20.040 in Uvalde and that would serve dozens of nearby counties 0:09:20.040 --> 0:09:24.200 and possibly prevent future massacres. Canadian Preme Minister Justin Trudeau 0:09:24.240 --> 0:09:27.480 announced an effort to ban handguns. Canada already has an 0:09:27.520 --> 0:09:30.679 assault weapons van and a news conference in Ottawa, Trudeau 0:09:30.800 --> 0:09:34.760 said the legislation would prohibit the purchase, sale, transfer, or 0:09:34.840 --> 0:09:38.840 import of handguns across Canada. We've seen far too many 0:09:38.880 --> 0:09:44.600 tragedies across this country, far too many incidents of gun violence, 0:09:44.640 --> 0:09:49.280 particularly with handguns. You know, streets in our communities, Devastating families, 0:09:49.760 --> 0:09:54.679 devastating communities. Trudeau also announced mandatory buybacks for assault weapons. 0:09:54.840 --> 0:09:57.040 Global News twenty four hours a day on air and 0:09:57.160 --> 0:10:00.800 on Bloomberg Quick Take, powered by more than listen analysts 0:10:01.000 --> 0:10:04.920 in more than twenty countries. I'm Michael Bard. This is Bloomberg, Nathan. Okay, Michael, 0:10:04.920 --> 0:10:11.559 Thanks coming up to five ten on Wall Streets. Time 0:10:11.559 --> 0:10:13.800 for the Bloomberg Sports update. Can reach on stash our. 0:10:13.880 --> 0:10:15.920 Good morning, Nathan. It's a good morning to a New 0:10:16.000 --> 0:10:18.680 York Rangers fan. What a postseason they are having. It's 0:10:18.720 --> 0:10:21.520 hardly over, but already five wins now and faced with 0:10:21.559 --> 0:10:26.600 elimination two game seven victories, two Series one, both when 0:10:26.600 --> 0:10:29.400 they never led the series until Game seven, and ROLEI 0:10:29.520 --> 0:10:32.120 last man a Hurricanes penalty and a Ranger lead and 0:10:32.320 --> 0:10:35.559 seconds to go all the Rangers power play. Rangers go 0:10:35.800 --> 0:10:38.559 back in top right side feed up for a year, 0:10:38.640 --> 0:10:47.320 back past the clock, scars out of Fox. It's a 0:10:47.679 --> 0:10:52.880 power play goal. Racheers lead Wonder not playing ro WPN 0:10:53.000 --> 0:10:55.160 Later in the first another power play goal of Chris 0:10:55.200 --> 0:10:57.880 tried to deflection. Crider scored again. In the third. Rangers 0:10:57.920 --> 0:11:01.200 beat the Hurricane six to two. Carolina had been seven 0:11:01.200 --> 0:11:04.000 and oh at home in the postseason. Rangers now coming 0:11:04.040 --> 0:11:06.640 home game one of the East Final with two time 0:11:06.720 --> 0:11:09.719 to find in Stanley Cup champion Tampa Bay tomorrow at 0:11:09.720 --> 0:11:12.200 the Garden City Field. Washington scored three runs first, seating 0:11:12.240 --> 0:11:15.040 the met score the next twelve. All twelve scored over 0:11:15.040 --> 0:11:17.240 the first four at ains Mets beat and that's thirteen 0:11:17.240 --> 0:11:19.960 to five, Starling Marte, Nick Plumber, both of home runs. 0:11:20.360 --> 0:11:24.840 Four RBI Detroit Tigers called up infielder Cody Clemens Rogers 0:11:24.880 --> 0:11:27.240 Sun expected to make his major league debut tonight. A 0:11:27.280 --> 0:11:29.640 couple of fourth round upsets the French Open the second 0:11:29.640 --> 0:11:32.240 and fourth scenes were ousted Danial Medvedev eaten by Marian 0:11:32.320 --> 0:11:35.040 Schilich straight sets, and Medvedev as it now not allowed 0:11:35.080 --> 0:11:38.640 to play Wimbledon, who has banned all Russians. Stefinal sits 0:11:38.679 --> 0:11:42.319 Aposs also lost big match today quarterfinals, Rafael and the 0:11:42.360 --> 0:11:47.120 dal Versus Novak Djokovic, John Stashward Bloomberg Sports, All right, John, 0:11:47.160 --> 0:11:49.839 thank you. Futures churning lower at the moment right now, 0:11:49.960 --> 0:11:52.319 S and P futures are down thirteen points, Staff futures 0:11:52.360 --> 0:11:55.760 down a hundred twelve, Nastact futures twelve points ten. Your 0:11:55.800 --> 0:12:00.719 treasury yield almost two point eight three percent. Lori Calvicina 0:12:00.880 --> 0:12:03.520 had a US equity r VC joins US. Next. This 0:12:03.640 --> 0:12:08.760 is Bloomberg Bloomberg day Break, brought to you by Pepack 0:12:08.800 --> 0:12:11.880 Private Wealth Management. Pepack Private Wealth Management knows that a 0:12:11.960 --> 0:12:14.439 portfolio is more than a collection of assets. It's a 0:12:14.480 --> 0:12:17.160 path to your future. Visit Pepack Private dot Com and 0:12:17.240 --> 0:12:24.320 begin your financial legacy Today. Markets, headlines and breaking news 0:12:24.320 --> 0:12:26.920 twenty four hours a day at Bloomberg dot Com, The 0:12:27.000 --> 0:12:30.480 Bloomberg Business At and at Bloomberg Quick Take, He's a 0:12:30.559 --> 0:12:40.480 Bloombern Business lash and I'm caered. Moscow stocks are slipping, 0:12:40.559 --> 0:12:43.560 Treasury is selling off across the curve as oil jump 0:12:43.600 --> 0:12:46.319 setting to worries about how aggressive central banks will need 0:12:46.360 --> 0:12:49.319 to be to rein and inflation without derailing growth. If 0:12:49.320 --> 0:12:51.680 we check the markets every fifteen minutes throughout the trading 0:12:51.720 --> 0:12:53.880 day on Bloomberg right now, U S and P futures 0:12:53.880 --> 0:12:57.160 are down fifteen points, dowal futures down a hundred fifteen 0:12:57.240 --> 0:13:00.360 Nastack futures down twenty three the dacks and remany is 0:13:00.400 --> 0:13:02.920 down half percent. To tend your treasury down twenty four 0:13:02.960 --> 0:13:05.839 thirty seconds held two point two percent. The yield on 0:13:05.880 --> 0:13:08.600 the two year two point five four percent nine max 0:13:08.640 --> 0:13:10.880 screwed oil is up three at a quarter percent, up 0:13:10.880 --> 0:13:13.280 three dollars seventy three cents at a hundred eighteen dollars 0:13:13.280 --> 0:13:15.679 eighty one cents of barrel comex s Gold is down 0:13:15.720 --> 0:13:17.480 a tenth of a percent on a dollar eighty at 0:13:17.520 --> 0:13:20.559 eighteen fifty five fifty announced. The euro one point oh 0:13:20.600 --> 0:13:23.040 seven three three against the dollar, British pound one point 0:13:23.040 --> 0:13:26.319 two six one four and again one seven point nine five. 0:13:26.679 --> 0:13:29.520 Bitcoin this morning higher up nine ten percent at thirty 0:13:29.520 --> 0:13:33.160 one thousand, five forty dollars. That's a Bloomberg business flash. 0:13:33.200 --> 0:13:35.360 Now here's Michael Barrow with more on what's going on 0:13:35.440 --> 0:13:38.400 around the World, Muchael, Good morning, Good morning Karen. Today 0:13:38.440 --> 0:13:41.760 will mark one week when nineteen children and two teachers 0:13:41.800 --> 0:13:45.640 were gunned down at a Robb Elementary school in Uvaldi, Texas. 0:13:46.120 --> 0:13:50.760 The first of one final farewells now beginning in Uvaldi. 0:13:51.200 --> 0:13:54.439 The w h o's top monkey box expert is skeptical 0:13:54.480 --> 0:13:57.920 the virus will become a global pandemic. W h OS 0:13:58.200 --> 0:14:03.000 Dr Rosemund Lewis says anyone can be at potential risk. 0:14:03.160 --> 0:14:07.440 However that is that they're not exactly sure how it's 0:14:07.480 --> 0:14:11.320 been spreading. In the NHL Playoffs, the Rangers are headed 0:14:11.360 --> 0:14:15.360 to the Eastern Finals after beating the Hurricanes in Game seven, 0:14:15.440 --> 0:14:18.120 six two. In baseball, the Mets to beat the Nationals 0:14:18.160 --> 0:14:21.600 thirteen five. The Orioles beat the Red Sox ten zip. 0:14:21.640 --> 0:14:25.720 The Giants won the A's lost. Global news twenty four 0:14:25.720 --> 0:14:29.120 hours a day on here and on Bloomberg Quicktech, powered 0:14:29.160 --> 0:14:31.960 by more than hundred journalists analysts more than a hundred 0:14:32.000 --> 0:14:36.240 twenty countries. Michael barn This is Bloomberg. Nathan, Okay, Michael. Thanks, 0:14:36.280 --> 0:14:39.080 It's five nineteen on Wall Street Live from the Bloomberg 0:14:39.080 --> 0:14:43.080 Interactive Brokers Studios. This is Bloomberg Daybreak. As we get 0:14:43.080 --> 0:14:46.200 ready to kick off a holiday short and trading week 0:14:46.360 --> 0:14:49.040 and a brand new month. We're very pleased to be 0:14:49.080 --> 0:14:51.960 joined this morning by Lori Calvasin ahead of US Equity 0:14:52.040 --> 0:14:56.520 Strategy at RBC Capital Markets. Lori, welcome back. Good to 0:14:56.560 --> 0:14:58.640 have you back with us as we start off this 0:14:58.720 --> 0:15:02.120 week with law US is for futures at the moment. 0:15:02.360 --> 0:15:05.480 What does that tell you about last week's rally coming 0:15:05.560 --> 0:15:10.040 after all those weeks of losses. Hi, well, thanks for 0:15:10.080 --> 0:15:12.320 having me. As always, look, I'm not reading too much 0:15:12.320 --> 0:15:14.600 into the futures action this morning, it does look like 0:15:14.640 --> 0:15:17.520 the nasdack is on futures are actually up a little bit, 0:15:17.520 --> 0:15:20.120 even though the SMP is down. And I do think 0:15:20.160 --> 0:15:22.680 the important thing is the rally that we saw last 0:15:22.720 --> 0:15:25.720 week being so strong and so decisive. You know, we 0:15:25.800 --> 0:15:28.200 had been talking about the drawdown that we've been seeing 0:15:28.200 --> 0:15:31.400 since January as when within the framework of a growth scare, 0:15:31.440 --> 0:15:33.760 and we've seen a number of those since the financial crisis, 0:15:33.760 --> 0:15:37.080 which have total fourteen UM and we had told people 0:15:37.080 --> 0:15:39.440 if we sort of broke out of that growth scare range, 0:15:39.440 --> 0:15:41.520 the market would be telling us it was anticipating a 0:15:41.560 --> 0:15:43.840 recession while it held it right at about eighteen point 0:15:43.880 --> 0:15:47.360 seven percent to the downside before rebounding. So I think 0:15:47.400 --> 0:15:49.560 you know that that price action we got last week 0:15:49.640 --> 0:15:53.040 was extraordinarily important and really told us that the market 0:15:53.120 --> 0:15:56.320 is not ready to price in a recession yet. Well, 0:15:56.320 --> 0:15:58.720 we did get a note this morning from Mike Wilson 0:15:58.800 --> 0:16:03.400 over Morgan Stanley. Obviously he's pretty bearish generally, but his 0:16:03.520 --> 0:16:07.160 argument is that the relief rally has limited scope with 0:16:07.400 --> 0:16:11.760 risks to growth still out there. Is he wrong? So 0:16:11.880 --> 0:16:14.040 our economists don't think that we're necessarily going to have 0:16:14.080 --> 0:16:17.280 a recession. They've lowered their GDP forecast down to trend 0:16:17.320 --> 0:16:19.600 like numbers, and if you look across the street, I 0:16:19.600 --> 0:16:21.720 would say, you know that the forecast that you just 0:16:21.800 --> 0:16:25.000 mentioned is an outlier. I think that the people who 0:16:25.040 --> 0:16:27.720 are calling for recession, who are calling for more dire times, 0:16:27.720 --> 0:16:31.520 they're getting a pretty disproportionate share um of you know, 0:16:31.680 --> 0:16:33.560 sort of the mind share out there right now, and 0:16:33.600 --> 0:16:35.680 the voices are pretty loud. But if you actually look 0:16:35.720 --> 0:16:39.440 at the Bloomberg Survey in terms of where consensus expectations 0:16:39.520 --> 0:16:41.280 are for this year, I think the last number I 0:16:41.280 --> 0:16:43.000 think I checked this on Friday was about two point 0:16:43.080 --> 0:16:45.760 seven percent GDP for this year and about one point 0:16:45.880 --> 0:16:49.120 nine percent for next year. So what we're seeing generally, uh, 0:16:49.160 --> 0:16:52.120 the economics community amound around the street is calling for 0:16:52.120 --> 0:16:54.840 a return to trend like growth and hasn't made that 0:16:54.920 --> 0:16:58.080 recession call, and that is what stocks are pivoting on 0:16:58.240 --> 0:17:00.560 as opposed to anyone voice out there. Do you think 0:17:00.600 --> 0:17:03.800 that growth is going to be driven by whatever the 0:17:03.840 --> 0:17:09.000 Fed does in terms of interest rate hikes going forward? Here? 0:17:09.000 --> 0:17:12.480 I mean, we just heard from Governor Waller saying he's 0:17:12.480 --> 0:17:16.280 at least in favor of keeping half percentage point increases 0:17:16.359 --> 0:17:20.520 going until inflation gets to target. I think one of 0:17:20.560 --> 0:17:23.240 the things that really powered stocks last week was a 0:17:23.240 --> 0:17:25.639 shift in tone from the FED and really just this 0:17:25.840 --> 0:17:28.480 idea that they will be flexible later on in the 0:17:28.560 --> 0:17:30.280 year and that that was one of the reasons why 0:17:30.280 --> 0:17:32.480 they wanted to bring the sort of these big chunky 0:17:32.560 --> 0:17:34.760 hikes forward so far early into this year, and I 0:17:34.800 --> 0:17:37.160 think the market really took some reassurance off of that. 0:17:37.640 --> 0:17:39.399 One of the things that we've seen from talking to 0:17:39.520 --> 0:17:42.720 investors and talk and looking at our survey work, frankly, 0:17:43.320 --> 0:17:46.399 is that there has been a real those who have 0:17:46.480 --> 0:17:48.720 been afraid that the FED was going to choke off growth, 0:17:48.760 --> 0:17:51.000 have outnumbered those who felt like they weren't going to 0:17:51.040 --> 0:17:53.399 do a good job of fighting inflation. And so I 0:17:53.440 --> 0:17:55.439 think what we got last week where a couple of 0:17:55.440 --> 0:17:57.680 comments that said that the FED does continue to care 0:17:57.720 --> 0:17:59.959 about growth. And I think at the end of the day, 0:18:00.359 --> 0:18:03.919 this labor market is so incredibly tight and so incredibly strong, 0:18:04.359 --> 0:18:07.280 you know, I think it's very difficult to see how 0:18:07.280 --> 0:18:10.159 a recession emerges in the context of all that, and 0:18:10.200 --> 0:18:12.520 I think that's something that markets are continuing to digest 0:18:12.560 --> 0:18:14.640 as well. It's just the strength of that labor backdrop. 0:18:15.000 --> 0:18:17.359 So where do you see the momentum for markets as 0:18:17.400 --> 0:18:20.400 we get ready to head into the month of June. Here, 0:18:20.600 --> 0:18:23.960 what's the trajectory for you? So look, we never try 0:18:24.000 --> 0:18:25.560 to make any calls, you know, just sort of on 0:18:25.560 --> 0:18:28.479 a one one month basis, on a very short term basis, 0:18:28.480 --> 0:18:30.280 but we do think that this market is in the 0:18:30.359 --> 0:18:34.040 process of pivoting back towards the growth trade and really 0:18:34.040 --> 0:18:37.480 looking for areas that will do well in a slow 0:18:37.520 --> 0:18:41.080 and growth environment, which traditionally ends up being growth stocks. Um, 0:18:41.080 --> 0:18:43.400 I do think you need tenure yields to cooperate before 0:18:43.440 --> 0:18:46.920 you can really see um that that shift are really 0:18:46.960 --> 0:18:49.680 cement um. But we do think that in particular is 0:18:49.720 --> 0:18:52.080 a defensive trade. If you look at things like stable 0:18:52.200 --> 0:18:56.480 healthcare utilities, that's defensive. Bucket of the market is as 0:18:56.520 --> 0:18:59.480 expensive as we tend to see it get relative to 0:18:59.520 --> 0:19:03.800 secular oh theories like consumer discretionary communication services or technology, 0:19:04.119 --> 0:19:05.720 and so I think at a minimum, I think the 0:19:05.760 --> 0:19:09.159 market is sort of exhausting this fascination with defensive sectors, 0:19:09.160 --> 0:19:10.680 and I think you can look for a pivot away 0:19:10.680 --> 0:19:13.400 from those as always great to get your thoughts, Lorie, 0:19:13.440 --> 0:19:15.679 thanks again for being with us. Lori Calvacina as head 0:19:15.720 --> 0:19:20.240 of US Equity Strategy at RBC Capital Markets. Looking at 0:19:20.320 --> 0:19:24.600 the futures ahead of the final open the month of May, 0:19:24.840 --> 0:19:27.040 futures are moving a touch lower right now. S and 0:19:27.080 --> 0:19:29.800 P futures are down eighteen points, STAFF futures down a 0:19:29.880 --> 0:19:33.560 hundred thirty five, Nasdaq futures down thirty points. UH. The 0:19:33.600 --> 0:19:36.840 tenure Treasury is down twenty three thirty seconds now with 0:19:36.920 --> 0:19:39.240 the yield two point two percent yield on the two 0:19:39.320 --> 0:19:43.840 year two point five four NIMEX crude continues its surge, 0:19:43.920 --> 0:19:46.440 up three point two per cent or three dollar sixty 0:19:46.440 --> 0:19:49.040 five cents at a hundred eighteen dollar seventy two cents 0:19:49.040 --> 0:19:52.600 a barrel. Onward from the European Union that an agreement 0:19:52.720 --> 0:19:57.159 has been reached for a partial ban on Russian oil. 0:19:57.800 --> 0:20:00.440 More to come, stay with us your list day to 0:20:00.560 --> 0:20:08.920 Bloomberg day Break, Good morning, Bloomberg eleven three oh weather 0:20:09.280 --> 0:20:12.480 hot today, low nineties, will be in the low seventies 0:20:12.520 --> 0:20:15.119 again tomorrow with a chance for a shower. Showers of 0:20:15.160 --> 0:20:18.280 thundershowers possible late Thursday with a high near eighty degrees. 0:20:18.400 --> 0:20:25.040 Right now seventy four broadcasting live from the Bloomberg Interactive 0:20:25.040 --> 0:20:28.920 Broker Studio in New York, Bloomberg Living Free on to Washington, 0:20:29.000 --> 0:20:33.120 d C. Bloomberg to Boston, Bloomberg one O six one, 0:20:33.200 --> 0:20:36.640 to San Francisco, Bloomberg nun sixteen to the Country, Sirius 0:20:36.800 --> 0:20:40.000 XM Chado one nineteen and around the globe the Bloomberg 0:20:40.000 --> 0:20:44.480 Business app and Bloomberg Radio dot Com. This is Bloomberg Daybreak. 0:20:50.400 --> 0:20:52.639 It's five thirty on Wall Street. Good morning. I'm Nathan 0:20:52.640 --> 0:20:55.600 Hager and I'm kerin mos Galley. Are just about four 0:20:55.600 --> 0:20:58.000 hours away from the open of US training. Let's get 0:20:58.000 --> 0:20:59.280 you up to date on the news. You need to 0:20:59.359 --> 0:21:01.760 know at this show, where we begin with oil, which 0:21:01.800 --> 0:21:04.520 is on the rise this morning, it is up three 0:21:04.560 --> 0:21:07.879 point two percent. The game comes after European Union leaders 0:21:07.880 --> 0:21:10.920 agreed to seek a ban on imports of most Russian oil. 0:21:11.119 --> 0:21:14.400 Bloombergus Maria Today OH has the latest from Brussels. When 0:21:14.480 --> 0:21:17.680 you look at the actual content, the Europeans say that 0:21:17.800 --> 0:21:20.639 on the best case scenario, if this deal is fully 0:21:20.640 --> 0:21:24.920 applied by the end of the year, of Russian oil 0:21:25.119 --> 0:21:29.840 exports coming into the European Union will essentially be shut off. 0:21:30.080 --> 0:21:33.600 Bloombergrus Maria Today O says EU leaders offered Hungary a 0:21:33.680 --> 0:21:37.639 guarantee that it will receive replacement supplies if pipelines were disrupted. 0:21:37.840 --> 0:21:40.880 Hungary have been blocking an embargo and will continue receiving 0:21:40.960 --> 0:21:44.800 Russian oil via pipeline. In response to that jump in oil, 0:21:44.880 --> 0:21:48.880 Karen stocks in Asia fluctuated and treasury sold off across 0:21:48.920 --> 0:21:52.040 the curve here in the US, Federal Reserve Governor Christopher 0:21:52.080 --> 0:21:54.879 Waller says he wants to keep raising interest rates and 0:21:55.000 --> 0:21:58.600 half percentage points steps until inflation is under control. He 0:21:58.680 --> 0:22:03.159 also believes reducing the balance sheet could curb inflation. Estimates 0:22:03.200 --> 0:22:06.440 are highly as certain using a variety of mobs and assumptions. 0:22:06.800 --> 0:22:12.280 The overall reduction in the balance sheet is estimated to 0:22:12.320 --> 0:22:15.919 be equivalent to a couple of point by based points 0:22:16.240 --> 0:22:20.119