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

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Speaker 2: Good morning, I'm Nathan Hagen and now I'm link Simiteo.

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Speaker 3: We begin in Bari, Italy for day two of the

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Speaker 3: three day G seven Leader's Summit. Support for Ukraine is

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Speaker 3: a key theme of this gathering. Today, the leaders plan

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Speaker 3: to send another message to Russia. Bloomberg News has learned

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Speaker 3: they'll issue a statement pledging to titan enforcement of their

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Speaker 3: existing price camp on Russian oil, choke off future Russian

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Speaker 3: energy projects, and cut Moscow's revenues from medals. President Biden's

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Speaker 3: delivered his own show of support for Ukraine. He signed

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Speaker 3: a ten year bilateral security agreement with President Vladimir Zelenski.

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Speaker 4: A lasting piece for Ukraine must be underwritten by Ukraine's

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Speaker 4: own ability to defend itself now and to deter future

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Speaker 4: aggression anytime in the future.

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Speaker 3: The President says, the US and its allies will be

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Speaker 3: with Ukraine quote until they prevail in this war. At

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Speaker 3: the same time, says he's standing by his decision not

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Speaker 3: to send US troops into Ukraine or to allow US

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Speaker 3: weapons to strike farther into Russian territory.

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Speaker 2: Meanwhile, Nathan, President Biden may be ready to take executive

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Speaker 2: action to protect more undocumented migrants in this country. We

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Speaker 2: get the details from Bloomberg Steve Potisk in Washington.

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Speaker 5: Bloomberg News has learned Biden is planning an executive action

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Speaker 5: as soon as next week that would protect certain undocumented

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Speaker 5: immigrants from deportation. Sources say the new measure would allow

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Speaker 5: spouses of US citizens who lack legal status to remain

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Speaker 5: in the country and seek authorization to work. Some who

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Speaker 5: receive relief could eventually gain a path to US citizenship.

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Speaker 5: Biden is considering an announcement as early as next Tuesday.

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Speaker 5: On that day, the White House is planning to celebrate

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Speaker 5: the anniversary of the Obama era program known as DAKA.

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Speaker 5: That program provided deportation reprieves and work permits to hundreds

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Speaker 5: of thousands of migrants who were brought to the US

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Speaker 5: illegally as miners. In Washington, Podusk Bloomberg Daybreak.

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Speaker 3: Okay, Steve, thanks, So, President Biden's presumptive opponent, former President

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Speaker 3: Donald Trump, is making a big promise to the business community.

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Speaker 3: He says he's going to cut the corporate tax rate

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Speaker 3: to twenty percent. Bloomberg's Ed Baxter has that story.

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Speaker 6: This is a pitch to corporate CEOs, about one hundred

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Speaker 6: of them, as well as House Republicans. He said a

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Speaker 6: cut from twenty one to twenty percent. He says it'd

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Speaker 6: be offset by future tariffs, and even a small reduction,

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Speaker 6: of course, means billions of dollars or profitable companies. He

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Speaker 6: also vowed to make permanent the sweeping twenty seventeen tax law.

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Speaker 6: As for the GOP itself, his theme we have.

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Speaker 1: Great unity, we have great common sense.

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Speaker 4: A lot of very smart people in this room, and

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Speaker 4: a lot of people that love our country.

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Speaker 6: Also promised to again slash regulations. Put on business head

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Speaker 6: Baxter Bloomberg Radio.

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Speaker 2: Turning to the markets now, the S and P five

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Speaker 2: hundred coming off a fourth consecutive record close this week.

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Speaker 2: In fact, the index reached its twenty ninth record of

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Speaker 2: the year on BET's the Federal Reserve will cut interest

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Speaker 2: rates before the years out. Stuart Kaiser is head of

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Speaker 2: US equity trading strategy at City Haith House Bloomberg. He's

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Speaker 2: bullish on equities for the foreseeable future.

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Speaker 7: You have an economy that for now is holding in solidly.

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Speaker 7: You've got double digit EPs growth, and I think those

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Speaker 7: two things in Generally speaking, you'd want high or you

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Speaker 7: would expect higher equity markets in that environment. And I

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Speaker 7: think that's just sort of the situation we're in. I mean,

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Speaker 7: our base case view is higher until and unless the

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Speaker 7: labor market really comes under significant pressure.

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Speaker 2: The City Stuart Kaiser believes this week's CPI reading, combined

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Speaker 2: with last week's strong jobs figure, will ease fears of

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Speaker 2: a recession even with higher for longer rates.

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Speaker 3: Speaking of higher Lisa, let's talk about Apple. That stock

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Speaker 3: just registered its biggest three day advance since August of

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Speaker 3: twenty twenty. The three day jump of about eleven percent

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Speaker 3: added almost three hundred and twenty four billion dollars to

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Speaker 3: the iPhone maker's market value. That is more than all

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Speaker 3: but a handful of components in the S and P

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Speaker 3: five hundred and Apple is now back above Microsoft as

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Speaker 3: the world's most valuable company, and.

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Speaker 2: Tech well once again be in focused today. Nathan. Adobe

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Speaker 2: shares are up fourteen percent in early trading after the bell.

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Speaker 2: Adobe raises annual profit outlook and projected strong future sales

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Speaker 2: for its creative products. We get details from Bloomberg's Charlie Pellett.

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Speaker 8: It suggests its customers are adopting the company's new artificial

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Speaker 8: intelligence based tools. Adobe said profit excluding some items will

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Speaker 8: be as much as eighteen twenty a share in the

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Speaker 8: fiscal year ending in January. Analysts, on average estimated eighteen

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Speaker 8: oh two. CFO Dan Durm says the company expects an

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Speaker 8: acceleration in new creative business through the rest of the

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Speaker 8: fiscal year. In New York, Charlie Pellette Bloomberg Radio.

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Speaker 3: Thank you, Charlie, sticking with company news. Tesla shareholders have

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Speaker 3: fact two resolutions sought by CEO Elon Musk. More on

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Speaker 3: that from Bloomberg's Doug Prisner.

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Speaker 9: The shareholders voted in favor of CEO Elon Musk's pay package.

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Speaker 9: They also approved mo moving Tesla's state of incorporation to

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Speaker 9: Texas from Delaware. Here's the thing, the pay vote is

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Speaker 9: only advisory. It doesn't guarantee Musk will get his comp

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Speaker 9: He negotiated a package in twenty eighteen and became eligible

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Speaker 9: for stock options if Tesla hit certain milestones. He succeeded,

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Speaker 9: but back in January, a Delaware judge nullified the plan.

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Speaker 9: The current value is more than forty eight billion dollars.

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Speaker 9: Tesla is expected to appeal if it fails, moving the

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Speaker 9: legal home to Texas would allow the board to revive

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Speaker 9: the package in a new state with potentially more favorable

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Speaker 9: courts in New York. I'm Doug Prisoner, Bloomberg Radio.

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Speaker 2: Thank you, Doug. Turning to Asia, the yen is slumping

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Speaker 2: against the dollar after the Bank of Japan delayed a

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Speaker 2: decision on its bond buying plan. We get the details

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Speaker 2: from Bloomberg Daybreak Asia anchor Ryan Curtis in Hong Kong.

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Speaker 10: The Bank of Japan has decided to reduce its bond purchases,

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Speaker 10: but it has left the market guessing as to the amount.

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Speaker 10: He will not specify amounts until the next meeting in July.

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Speaker 10: Decision led to selling of the en as investors who

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Speaker 10: were primed for details at this meeting. The boj stood

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Speaker 10: pat on other policies. It kept the overnight call rate

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Speaker 10: between zero and zero point one percent. The nick posted

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Speaker 10: modest gains. Brian Curtis, Bloomberg Radio.

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Speaker 3: Okay, Brian, thank you. One more corporate note back in

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Speaker 3: this country. A federal judge in Brooklyn is indicating she

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Speaker 3: is likely to reject a thirty billion dollars settlement between

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Speaker 3: Visa MasterCard and retailers to cap credit card swipe fees.

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Speaker 3: And retailers have fought for decades to slash their share

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Speaker 3: of the cost for accepting card payments, also known as

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Speaker 3: interchange fees. The deal was announced in March. It wouldn't

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Speaker 3: let merchants charge consumers more for transactions involving Visa or MasterCard.

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Speaker 2: Time now for a look at some of the other

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

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Speaker 2: For that, we're joined by Bloomberg's Michael bar Good morning, Michael.

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Speaker 11: Good morning Lisa. Still no deal. The US State Department

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Speaker 11: is encouraging a mosque to stop aggling on a propose

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Speaker 11: East fire hostage deal with Israel. State Department spokesman Matthew

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Speaker 11: Miller would not go into details on the sticking points,

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Speaker 11: but dismissed the idea that AMAS should need assurances for

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Speaker 11: elasting peace.

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Speaker 12: We were disappointed both that it took so long to

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Speaker 12: get a response and that the response had a number

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Speaker 12: of changes that could drag the negotiations out further.

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Speaker 11: Memile. The US built pier to bring food to gazes,

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Speaker 11: Facing one of its most serious challenges yet, the United

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Speaker 11: Nations is deciding if it can keep safely delivering supplies

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Speaker 11: from the USC route to starving Palestinians. The UN has

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Speaker 11: paused its work with the pier since June eighth. That's

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Speaker 11: when in operation by Israeli security forces rescued for Israeli

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Speaker 11: hostages and killed more than two hundred and seventy Palestinians.

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Speaker 11: The US and Israel say no part of the PEER

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Speaker 11: was used in the raid, but in Israeli helicopter used

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Speaker 11: a spot near the pier. The UN and aid groups

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Speaker 11: say they fear relief workers operating with the PEER are

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Speaker 11: being seen as a line with Israel and becoming targets.

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Speaker 11: The PEER has also been subjected to repairs because of

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Speaker 11: rough seas. The NYPD continues to search for protesters who

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Speaker 11: cause disruption on a subway train. It comes amid vandalism

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Speaker 11: during several pro Palestinian demonstrations in New York this week.

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Speaker 11: State lawmakers are now looking to ban protesters from covering

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Speaker 11: their face during demonstrations. At the G seventh summit in Italy,

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Speaker 11: President Biden was asked about his son, Hunter Biden's recent

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Speaker 11: gun conviction.

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Speaker 4: I'm extremely proud of my son Hunter. He has overcome

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Speaker 4: an addiction. He's one of the greatest, most decent men

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Speaker 4: I know, and I am satisfied that I'm not going

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Speaker 4: to do anything. I said, I adviye by the jury decision,

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Speaker 4: and I will do that and I will not partner him.

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Speaker 11: When asked if he would commute his son's sentenced to

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Speaker 11: reduce it, the President replied no. Forecasters have warned Floridians

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Speaker 11: to prepare for addition flash flooding after a tropical disturbance

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Speaker 11: dumped as much as twenty inches of rainfall in the

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Speaker 11: southern parts of the state earlier this week. This resident

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Speaker 11: in Hollandale Beach says his home is okay, but his

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Speaker 11: car is underwater.

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Speaker 9: It was just coming up to the house.

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Speaker 7: We were on high ground, but the other houses are

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Speaker 7: just destroyed around here.

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Speaker 11: Conditions are expected to worsen. Today Global News twenty four

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Speaker 11: hours a day and whatever you want it with Bloomberg

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Speaker 11: News Now. I'm Michael Barr. This is Bloomberg Lears.

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Speaker 2: Thank you, Michael. Time now for a Bloomberg Sports update.

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Speaker 2: For that, we bring in Dan Schwartzman.

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Speaker 13: Good morning. Nathan Rory McCrory finishing his last three holes

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Speaker 13: with two birdies to ty Patrick Canley atop the leaderboard

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Speaker 13: at five under par. After the first round of the

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Speaker 13: US Open at Pinehurst, North Carolina, Rory talked about the

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Speaker 13: final holes of his round.

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Speaker 12: And I was just on this on this run of

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Speaker 12: hitting at the twenty feet and two putting. Actually had

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Speaker 12: a good two put on fifteen, But I just felt

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Speaker 12: like my patients, I could have gone a little impatient,

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Speaker 12: but I felt like my patients was rewarded there with

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Speaker 12: the parties, you know, into the last three holes. So

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Speaker 12: you know, it was really nice to finish like that,

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Speaker 12: and you know, as I said, you know, a nice

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Speaker 12: better momentum going into the morning runs.

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Speaker 13: That's courtesy of ESPN dot Com. Meanwhile, rough round for

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Speaker 13: Tiger Woods as he finishes four over par. Tiger will

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Speaker 13: be teeing off a little after one fourteen this afternoon.

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Speaker 13: In Major League Baseball, the Yankees can't finish off a

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Speaker 13: sweep of the Royals as Kansas City wins it on

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Speaker 13: a walkoff, two run double off Clay Holmes. Coming up tonight,

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Speaker 13: the Yankees are on the road in Boston to open

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Speaker 13: up a three game weekend set. Luis Heel on the

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Speaker 13: hill for the Yankees, Brian Bellow for the Red Sox.

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Speaker 8: The Mets.

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Speaker 13: Meanwhile, they win on a walkoff from j D. Martinez.

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Speaker 12: G D.

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Speaker 7: Rocketts went out to white center back at the capos chisel.

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Speaker 1: Looking up head it on the hair. JD.

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Speaker 13: By Tinez wins it hold up to run opposite field

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Speaker 13: over road. That's courtesy of Mets dot Com. The Mets

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Speaker 13: knocking off the Marlins three two. Mets are home for

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Speaker 13: the San Diego Padres as they open up the first

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Speaker 13: game of a three game set. On the mound for

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Speaker 13: the Mets is Shan Manyah that Matt Waldron taking the

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Speaker 13: mound for the Padres. In the Stanley Cup Final, the

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Speaker 13: Florida Panthers, now one, went away from sweeping the series

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Speaker 13: as they win ad Edmondson over the Oilers four to three.

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Speaker 13: Game number four comes on Saturday north of the border. Finally,

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Speaker 13: in the NFL, the Jacksonville Jaguars and quarterback Trevor Lawrence

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Speaker 13: have agreed to a massive five year, two hundred and

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Speaker 13: seventy five million dollar contract extension that includes two hundred

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Speaker 13: million dollars guaranteed and one hundred and forty two million

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Speaker 13: at signing. Batchel Bloomberg Sports update on Dan Schwarzman, Nathan

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Speaker 13: and Lisa.

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Speaker 11: Coast to coast on Bloomberg Radio, nationwide on Sirius XM, and.

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Speaker 8: Around the world on Bloomberg dot Com and the Bloomberg

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Speaker 8: Business app.

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Speaker 11: This is Bloomberg Daybreak.

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Speaker 3: Good morning. I'm Nathan Hagar, and the bulls just keep

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Speaker 3: on running. The SMP five hundred has notched all time

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Speaker 3: highs every day this week. Actually, even with the FED

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Speaker 3: dialing back its own rate cut expectations, these new signs

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Speaker 3: of disinflation that we saw this week seem to have

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Speaker 3: the markets making bets of its own. So let's get

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Speaker 3: more on what is happening in this market. For that,

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Speaker 3: we are joined by Gina Martin Adams this morning, the

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Speaker 3: chief equity strategist at Bloomberg Intelligence. Gina, good morning, Thanks

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Speaker 3: so much for being with us. Can this rally sustain?

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Speaker 1: You know, I think that what was interesting is coming

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Speaker 1: out of the earning season, we sort of lost a

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Speaker 1: little bit of momentum on equities as earning seasons, especially

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Speaker 1: this year, have proven to be big catalysts for optimism

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Speaker 1: given low expectations that companies were able to be pretty easily.

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Speaker 1: You know, after earning season, you generally do see some

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Speaker 1: deterioration in price momentum in the s and P five

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Speaker 1: hundred emerge. But fortunately the economic data has come into

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Speaker 1: kind of save the day, especially over the course of

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Speaker 1: the last few days, be easing and inflation in particular,

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Speaker 1: the continued positive spread between CPI and PPI but generally

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Speaker 1: the downward trajectory of inflation has helped ease some concerns.

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Speaker 1: At the same time, you know, economic expectations are relatively stable,

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Speaker 1: and that's creating a pretty good a pretty good backdrop

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Speaker 1: for risk taking for the index.

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Speaker 3: Well, there is there a risk, though, Gina, that the

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Speaker 3: market could be getting a little over excited about this disinflation.

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Speaker 3: I mean, it is one month's data, right.

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Speaker 1: Yeah, there always is a risk. But we have had

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Speaker 1: persistence and disinflation really since the beginning of twenty twenty three.

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Speaker 1: It paused somewhat earlier this year, but the fact that

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Speaker 1: we have had general persistence in the disinflationary trend since

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Speaker 1: the end of twenty twenty two early twenty twenty three,

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Speaker 1: I think is the bigger story that we need to

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Speaker 1: keep in mind, and we do find in particular, you

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Speaker 1: want to look at the details of inflation. So I

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Speaker 1: understand that the market is somewhat captivated right now by

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Speaker 1: what's happening with CPI, but probably what's even more important

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Speaker 1: for stock prices at large is how the interplay between

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Speaker 1: CPI and PPI, or consumer prices and producer prices plays out.

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Speaker 1: This is a proxy for margins on the S and

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Speaker 1: P five hundred, and as long as consumer prices are

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Speaker 1: rising faster than producer prices, and as long as producer

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Speaker 1: prices are not rising too quickly, generally rising below a

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Speaker 1: pace of three percent year over year, we tend to

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Speaker 1: see margins continue to rise on the S and P

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Speaker 1: five hundred. This is particularly consequential in an environment where

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Speaker 1: you know economic uncertainty is still somewhat high given higher

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Speaker 1: interest rates. If company margins continue to inflate because of

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Speaker 1: the inflate because of the broader inflation backdrop, generally, that's

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Speaker 1: pretty good news for earning's growth, which tends to power

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Speaker 1: stock prices well.

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Speaker 3: With the betting that this trend in the economic data

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Speaker 3: could continue. We've seen a lot of attention as well

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Speaker 3: on the tech stocks really being a beneficiary of where

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Speaker 3: the rate environment is right now. Do you see that

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Speaker 3: continuing tech leading the way or can other sectors start

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Speaker 3: to benefit.

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Speaker 1: Yeah, I think that actually the reason Tech has led

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Speaker 1: the way is not necessarily be because of interest rates,

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Speaker 1: but really because of what's going on in the earnings.

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Speaker 1: Tech companies have powered significantly faster earnings growth than the

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Speaker 1: rest of the market over the course of the last

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Speaker 1: several quarters, really leading the way in a cycle recovery

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Speaker 1: that started about this time last year. And what we

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Speaker 1: should see over the second half of this year and

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Speaker 1: into twenty twenty five is the emergence of growth in

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Speaker 1: some of the rest of the S and P five hundred,

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Speaker 1: which may of course spark resk tolerance and interest and

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Speaker 1: investment in those segments of the index that's really been lacking.

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Speaker 1: Over the course of the last several quarters. We've had

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Speaker 1: double digit and even greater than twenty percent declines in

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Speaker 1: earnings growth year every year for several sectors, including energy, materials,

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Speaker 1: and healthcare on the S and P five hundred. That

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Speaker 1: has really created a strong divergence in in rest or

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Speaker 1: risk appetite for sector level investing. It's favored Tech and

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Speaker 1: disfavored several other segments. Obviously, but as we move into

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Speaker 1: the second half of the year and into twenty twenty five,

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Speaker 1: that divergence should close. We should see almost every sector

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Speaker 1: on the index start to host EPs growth at the

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Speaker 1: course of the next quarter in the July reporting season,

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Speaker 1: and then by the October reporting season, every sector in

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Speaker 1: the index is expected to post here every year earnings growth.

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Speaker 1: By early twenty twenty five, Tech earnings growth should be

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Speaker 1: equivalent to or roughly equivalent to ex tech earnings growth

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Speaker 1: on the S and P five hundred, which should create

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Speaker 1: some very different trends on the index at large.

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