WEBVTT - Bloomberg Daybreak: July 11, 2022 - Hour 1 (Radio) 0:00:02.880 --> 0:00:06.160 Live from the Bloomberg Interactive Brooker Studios. This is Bloomberg 0:00:06.200 --> 0:00:09.800 Daybreak for Monday, July eleven two. Coming up this hour, 0:00:10.039 --> 0:00:13.680 Twitter shares plunge after Elon must ends his takeover bid. 0:00:13.920 --> 0:00:15.920 Now the future of Twitter appears to be headed for 0:00:16.000 --> 0:00:19.120 a courtroom. Bank earnings and a key inflation report grabbed 0:00:19.120 --> 0:00:21.080 the spotlight on Wall Street this week, and the race 0:00:21.160 --> 0:00:24.440 to succeed Boris Johnson as UK Prime Minister heats up. 0:00:24.560 --> 0:00:27.720 Steve Bennon's attorneys saying he is now willing to testify 0:00:27.920 --> 0:00:31.120 before the January sixth House Committee plus Senate ma Geority 0:00:31.200 --> 0:00:34.680 Leader Schumer asked covid, I'm Michael blomen more ahead, I'm 0:00:34.840 --> 0:00:37.159 on Stagon Sports the Yankees for the second night in 0:00:37.200 --> 0:00:39.559 the road. Blue Lee lost to the Red Sox in Boston. 0:00:39.600 --> 0:00:41.760 The Mets were shut out. They visit the Braves tonight. 0:00:44.240 --> 0:00:47.680 That's all straight ahead on Bloomberg day Break on Bloomberg 0:00:47.720 --> 0:00:51.120 eleven Free on New York Bloomberg ninety nine one, Washington, 0:00:51.240 --> 0:00:54.960 d C Bloomberg one oh six one, Boston, Bloomberg nine sixty, 0:00:55.080 --> 0:00:58.760 San Francisco, Sirius x M one nineteen and around the 0:00:58.760 --> 0:01:02.840 world on Bloomberg Radio dot com and via the Bloomberg Business. 0:01:07.240 --> 0:01:10.200 Good morning. I'm Nathan Hagar and I'm Karen Moscow. When 0:01:10.280 --> 0:01:12.880 US dot in next, Futures are moving lower this morning. 0:01:12.880 --> 0:01:14.720 We're coming up to FACO one on Wall Street, and 0:01:14.800 --> 0:01:17.240 we check the markets every fifteen minutes throughout the trading 0:01:17.319 --> 0:01:20.280 day on Bloomberg. Right now, US and futures are down 0:01:20.280 --> 0:01:24.520 twenty six points down, futures down two and NASTAG futures down. 0:01:24.520 --> 0:01:27.800 In the ten year treasury at five thirty seconds, you 0:01:27.880 --> 0:01:29.920 have three point oh five percent, and they yield on 0:01:29.959 --> 0:01:33.440 the two year three point oh seven per cent. Nathan, Karen, 0:01:33.480 --> 0:01:36.120 We're keeping an eye on Twitter shares this morning. They 0:01:36.120 --> 0:01:39.360 are down six and three quarters percent in early trading 0:01:39.400 --> 0:01:42.640 as the showdown between Elon Musk and the social media 0:01:42.680 --> 0:01:46.440 company appears headed for court. Let's get the latest live 0:01:46.480 --> 0:01:49.320 from Bloomberg's Rnita Young. Good morning, Granita, Good morning Nathan. 0:01:49.440 --> 0:01:51.920 Even though Elon Musk is backing out of the forty 0:01:52.000 --> 0:01:54.880 four billion dollar deal to buy Twitter, after all, he 0:01:55.040 --> 0:01:58.400 can't just walk away without a court case, and Twitter 0:01:58.440 --> 0:02:00.840 has lawyered up in a race to sue Musk to 0:02:00.920 --> 0:02:04.160 follow through on his end of the agreement, Bloomberg sources 0:02:04.200 --> 0:02:07.320 say of filing could come as soon as early this week. Now. 0:02:07.360 --> 0:02:10.000 If the judge rules against Musk, he could be forced 0:02:10.040 --> 0:02:13.200 to pay Twitter shareholders fifty four dollars and twenty cents 0:02:13.200 --> 0:02:15.760 a share. But a ruling in his favor would let 0:02:15.840 --> 0:02:18.560 Musk walk, although he probably have to pay a one 0:02:18.600 --> 0:02:22.360 billion dollar breakup fee. And there's still also the prospect 0:02:22.440 --> 0:02:25.280 that both sides could reach a settlement where Musk still 0:02:25.320 --> 0:02:29.000 makes the acquisition, but potentially at a lower price. Live 0:02:29.040 --> 0:02:31.800 in New York, I'm rened a young Bloomberg Daybreak, all right, 0:02:31.800 --> 0:02:33.880 rened to thank you about the Twitter news is also 0:02:33.919 --> 0:02:37.760 impacting another stock this morning. Shares of Digital World acquisition 0:02:37.800 --> 0:02:40.520 are up more than twenty four percent on heavy volume 0:02:40.520 --> 0:02:43.880 and early trading. Digital World the company emerging with former 0:02:43.919 --> 0:02:47.440 President Trump's Trump Media and Technology Group, which owns his 0:02:47.560 --> 0:02:51.640 Truth social platform. Well, stocks overall are lower this morning, Karen, 0:02:51.680 --> 0:02:54.440 as we begin a new trading week in Asia, Overnight, 0:02:54.440 --> 0:02:57.360 a resurgence of COVID flare ups led to a drop 0:02:57.400 --> 0:03:00.560 of almost three percent for Hong Kong's Hang Sent Index. 0:03:00.800 --> 0:03:03.320 Let's get the recap from Bloomberg day Break Asia anchor 0:03:03.360 --> 0:03:07.960 Bran Curtis, most Asian benchmark slid COVID cases in Shanghai 0:03:08.000 --> 0:03:11.920 arising as the city faces more mass testing. In Macau, 0:03:12.040 --> 0:03:15.400 authority shut down casinos and other businesses for a week. 0:03:15.639 --> 0:03:18.840 As a result, casino shares took a big hit. Tokyo, 0:03:18.919 --> 0:03:21.280 though was a bright spot after the ruling coalition won 0:03:21.320 --> 0:03:24.600 a stronger majority in the upper house election. The end 0:03:24.840 --> 0:03:28.400 was the weakest. Major currency traders see the election result 0:03:28.480 --> 0:03:32.640 as an endorsement of Japan's ultra easy monetary policy. In 0:03:32.720 --> 0:03:35.720 Hong Kong, Brian Curtis, Bloomberg day Break, Brian, thank you 0:03:35.760 --> 0:03:38.600 back here in the US. We have conflicting calls this morning, 0:03:38.600 --> 0:03:41.960 and whether the reason stock rally will continue. Morgan Stanley 0:03:42.000 --> 0:03:45.360 Chief US equity strategist Mike Wilson says it won't. He 0:03:45.400 --> 0:03:47.560 thinks the surge in the dollar will be a headwind 0:03:47.600 --> 0:03:50.840 for corporate profits. On the flip side, City Group strategists 0:03:50.840 --> 0:03:53.200 say stocks are likely to rally in the second half 0:03:53.400 --> 0:03:56.640 as corporate earnings remain resilient to searching inflation and slowing 0:03:56.640 --> 0:03:59.200 economic growth. The S and P five hundred is up 0:03:59.200 --> 0:04:01.960 about six per set since it's mid June. Low well 0:04:02.000 --> 0:04:04.840 speaking of earning screen reporting season gets underway this week 0:04:04.880 --> 0:04:07.160 as we hear from the country's biggest banks. More on 0:04:07.160 --> 0:04:11.000 that from Bloomberg's Charlie Pellett. The question on everyone's mind 0:04:11.120 --> 0:04:14.520 is is a recession coming? On? What clues will the 0:04:14.600 --> 0:04:18.360 latest batch of earnings reports provide. Scott croner To is 0:04:18.400 --> 0:04:21.679 a strategist at City Group Global Markets. What we're expecting 0:04:21.720 --> 0:04:23.800 to see is a follow through of the earning the 0:04:23.839 --> 0:04:25.960 nurse we got in Q one, so we're looking for 0:04:26.040 --> 0:04:28.680 mid single digit EARNIE shows for the SMP in total. 0:04:29.120 --> 0:04:33.120 We think we'll make the Q two expectations. Certainly C 0:04:33.360 --> 0:04:37.600 suites will express caution regarding the second half outlook. Wall 0:04:37.600 --> 0:04:41.000 Street Banks leadoff second quarter earnings JP. Morgan Chase and 0:04:41.080 --> 0:04:45.120 Morgan Stanley report Thursday, City Group and Wells Fargo on 0:04:45.240 --> 0:04:49.800 Friday in New York. Charlie Pellett Bloomberg Day Break, All right, Charlie, 0:04:49.800 --> 0:04:51.840 thank you all. On the economic front this week, it's 0:04:51.839 --> 0:04:55.760 all about inflation, with readings coming on consumer and producer prices. 0:04:55.800 --> 0:04:58.360 We get a preview from Bloomberg's Vinnie down ju Dice. 0:04:58.560 --> 0:05:02.120 June's household inflation probably ran close to nine percent based 0:05:02.160 --> 0:05:06.039 on Wall Street forecast. That's taking a toll. Bloomberg econonamics 0:05:06.200 --> 0:05:08.760 is average hourly earnings have been shrinking for more than 0:05:08.800 --> 0:05:11.880 a year when taking inflation into account. Look for that 0:05:11.920 --> 0:05:14.800 trying to drag on with the household inflation rate projected 0:05:14.839 --> 0:05:17.520 to run at or above seven percent through year end. 0:05:17.920 --> 0:05:20.760 We'll get the consumer price index Wednesday, as well as 0:05:20.880 --> 0:05:24.440 data on producer prices Thursday and import prices Friday. Benny 0:05:24.520 --> 0:05:27.040 Delta s Bloombergday Break. All right, Benny, thanks, And when 0:05:27.040 --> 0:05:30.040 it comes to tackling inflation, the Biden administrations thinking about 0:05:30.120 --> 0:05:33.320 lowering tariffs on Chinese imports is one way to provide relief. 0:05:33.560 --> 0:05:36.719 President Biden says he is still holding discussions on the idea. 0:05:37.000 --> 0:05:40.880 Commerce Secretary Gina Raimondo expects a decision from the President shortly. 0:05:41.360 --> 0:05:44.120 If he decides to lift certain tariffs, it will be 0:05:44.520 --> 0:05:47.719 because he knows he has to think about doing everything 0:05:47.800 --> 0:05:51.360 he possibly can to provide any relief to consumers. Secretary 0:05:51.480 --> 0:05:54.120 Ramando made that comment on NBC's Meet the Press heard 0:05:54.200 --> 0:05:56.960 Sundays on Bloomberg Radio, and stay tuned for more from 0:05:57.000 --> 0:06:00.320 the Commerce secretary later today. Gina Ramondo said it's down 0:06:00.360 --> 0:06:03.000 with Bloomberg Radio and Television for an interview in the 0:06:03.080 --> 0:06:06.159 eleven AM Eastern hour. Well in Europe this week, Nathan, 0:06:06.200 --> 0:06:08.600 the race is heating up to succeed Boris Johnson as 0:06:08.640 --> 0:06:11.040 British Prime Minister. Let's go live to London and get 0:06:11.120 --> 0:06:13.560 the latest at the Bloomberg's un parts. Good morning you, 0:06:14.120 --> 0:06:17.200 Good morning Karden, Nathan. Just days after Boss Johnson was 0:06:17.240 --> 0:06:20.760 pushed into resigning, there are now eleven candidates to succeed 0:06:20.880 --> 0:06:24.400 him as Conservative Party leader. Liz Trust, the Foreign Secretary, 0:06:24.520 --> 0:06:26.920 is the latest ends of the race. She's making tax 0:06:27.000 --> 0:06:30.080 cuts the hearts of her campaign. Lomakers were expected to 0:06:30.120 --> 0:06:32.920 begin voting later this week. As the field is narrow 0:06:33.040 --> 0:06:36.000 to the final two candidates, one of them will become 0:06:36.040 --> 0:06:38.560 the UK's next Prime minister. In London, I'm you in 0:06:38.560 --> 0:06:40.960 parts between BOK Daybreak, Okay you and thanks. Let's stay 0:06:40.960 --> 0:06:43.920 in Europe where natural gas prices are falling today. That's 0:06:43.920 --> 0:06:46.640 after Canada said it would return a stranded turbine for 0:06:46.720 --> 0:06:50.039 the nord Stream pipeline between Russia and Germany that could 0:06:50.080 --> 0:06:53.599 potentially increase flows, which have been limited since last month. 0:06:53.960 --> 0:06:56.640 The nord Stream pipeline between Russia and Germany is currently 0:06:56.720 --> 0:06:59.560 undergoing routine maintenance at the same time the war in 0:06:59.680 --> 0:07:02.360 ukry in his sparking concerns that maybe Moscow will not 0:07:02.560 --> 0:07:06.279 open the pipeline back up after the work. SMP future 0:07:06.320 --> 0:07:08.600 is now down twenty one points. Now futures down a 0:07:08.680 --> 0:07:11.920 hundred fifty three NASTAC futures are lowered by eighty four points. 0:07:11.960 --> 0:07:14.240 The tenure treasury is up five thirty seconds for a 0:07:14.280 --> 0:07:17.160 yield close to three point zero six percent. Your latest 0:07:17.200 --> 0:07:20.120 local headlines into check of sports. Next, this is Bloomberg 0:07:23.440 --> 0:07:25.320 and it's now five oh seven on Wall Street where 0:07:25.400 --> 0:07:28.080 sixties seven degrees in Central Park already a problem if 0:07:28.080 --> 0:07:30.520 you're heading to the Kennedy Airport. There's an accident on 0:07:30.560 --> 0:07:33.880 the westbound Belt Parkway across Babel of Our details coming 0:07:33.920 --> 0:07:36.160 up in Traffic. First, Michael Barr with more on what's 0:07:36.160 --> 0:07:38.240 going on in New York and around the world. Good morning, 0:07:38.320 --> 0:07:41.240 MI Call, Good morning Nathan. Donald. Trump's one time adviser, 0:07:41.320 --> 0:07:44.440 Steve Bannon, has agreed to testify to the House committee 0:07:44.480 --> 0:07:48.200 investigating last year's storming of the US Capitol. It comes 0:07:48.280 --> 0:07:52.560 after former President Trump says he waived executive privilege even 0:07:52.600 --> 0:07:54.800 though Bannon was a private citizen at the time of 0:07:54.840 --> 0:07:58.800 the Capitol riot. Trump portrays the inquiry is biased and 0:07:59.040 --> 0:08:03.200 one side it. Loyola Law University professor Lorie Levinson says, 0:08:03.320 --> 0:08:06.280 though the value of Bannon's testimony remains to be determined, 0:08:06.520 --> 0:08:08.840 the real problem is that I'm not sure that they 0:08:08.880 --> 0:08:12.680 can trust Bannon at all. It is clear that he 0:08:12.960 --> 0:08:17.080 and Trump still considered themselves best friends, and that if 0:08:17.120 --> 0:08:19.880 Bannon comes in front of the committee, it is very 0:08:20.000 --> 0:08:23.560 unclear what he would say that would help their investigation. 0:08:24.080 --> 0:08:27.800 But isn't just designed to help Trump. Loyola Law professor 0:08:27.920 --> 0:08:31.040 Lourie Levinson says Bennon was facing two criminal accounts of 0:08:31.160 --> 0:08:34.760 contempt of Congress for refusing to comply with the committee's subpoena. 0:08:35.400 --> 0:08:38.320 The car pooling discount is over at the George Washington 0:08:38.440 --> 0:08:41.560 Bridge the g w B when cash less tolls over 0:08:41.600 --> 0:08:44.920 the weekend. Normally, it was a sixteen dollar fee one 0:08:45.000 --> 0:08:47.240 way to get across the bridge from New Jersey to 0:08:47.400 --> 0:08:51.120 New York, but drivers who had a car pool discount 0:08:51.200 --> 0:08:55.000 plan on their easy passes paid only seven fifty with 0:08:55.120 --> 0:08:58.440 three or more people in the vehicle. Officials hope going 0:08:58.559 --> 0:09:00.760 cash less at the g w B will mean a 0:09:00.880 --> 0:09:04.240 faster commute into the city. New York City is debuting 0:09:04.280 --> 0:09:07.079 a fleet of cars mounted with air quality sensors in 0:09:07.120 --> 0:09:09.640 the Bronx and Manhattan this week. The plan is to 0:09:09.679 --> 0:09:14.120 address air pollution. Japanese Prime Minister Fumio Kashda has met 0:09:14.200 --> 0:09:17.040 with U S Secretary of State Anthony B. Lincoln. He 0:09:17.320 --> 0:09:21.320 delivered condolences from President Biden and the United States over 0:09:21.400 --> 0:09:25.120 the assassination of former leadershian Zoabe and reassurances of a 0:09:25.200 --> 0:09:28.520 strong bid lateral alliance. I thought it was just important 0:09:28.920 --> 0:09:32.439 to show our solidarity with our friend Japan and the 0:09:32.520 --> 0:09:36.480 Japanese people in this difficult time. Secretary Lincoln says the 0:09:36.600 --> 0:09:39.839 US and Japan are more than allies, We're friends. Senate 0:09:39.920 --> 0:09:43.120 Majority Leader Chuck Schumer's office says he tested positive for 0:09:43.160 --> 0:09:48.000 COVID nineteen. Schumer spokesman says the Senator is experiencing mild symptoms. 0:09:48.400 --> 0:09:51.679 The statement said Schumer is fully vaccinated and double boosted. 0:09:51.760 --> 0:09:54.520 Schumer says he will quarantine this week and work remotely 0:09:54.679 --> 0:09:57.400 as he recovers global news twenty four hours a day 0:09:57.480 --> 0:09:59.880 on air and on Bloomberg quick Take, powered by more 0:10:00.200 --> 0:10:03.400 that seven hundred journalists, analysts more than a hundred twenty countries. 0:10:03.679 --> 0:10:11.160 Michael Bard, this is Bloomberg, Nathan, Thank you. Michael came 0:10:11.240 --> 0:10:13.160 into five ten on Wall Street time for the Bloomberg 0:10:13.240 --> 0:10:15.880 Sports Update. Good morning, John Senshi, All right, Good morning Nathan. 0:10:15.960 --> 0:10:18.920 Twenty four hours after the rare occurrence of a Yankees 0:10:19.000 --> 0:10:22.120 blown lead, it happened again. Yanks lead the Residence four nothing, 0:10:22.240 --> 0:10:25.040 later six two socks for the last nine runs and 0:10:25.160 --> 0:10:27.480 one eleven six to gain a split of the four 0:10:27.520 --> 0:10:29.760 game series in Boston. A J. D. Martinez home run 0:10:29.840 --> 0:10:32.640 fifth inning off Jamison ti On tied the game at six. 0:10:32.720 --> 0:10:35.760 A Trevor Story three run double off Miguel Castro in 0:10:35.840 --> 0:10:38.199 the seventh put it away. Yanks got home runs and 0:10:38.240 --> 0:10:40.959 defeat from Giant Carlo Stans didn't get another from Matt Carpenter, 0:10:41.080 --> 0:10:43.560 but hurt by a couple of hours plus two catchable 0:10:43.640 --> 0:10:46.360 pop ups. The dj Lemi who failed to grab Yanks 0:10:46.400 --> 0:10:48.839 are off tonight. Mets tonight begin their biggest series of 0:10:48.880 --> 0:10:53.000 the season in Atlanta. Max Scherzer opposes the Braves, Max Freed. 0:10:53.400 --> 0:10:55.960 Mets couldn't score over ten innings, blost to the Marlins 0:10:56.000 --> 0:10:59.000 to nothing. Atlanta one of the ninth inning. The Mets League, 0:10:59.040 --> 0:11:01.840 once ten and a half games, now one and a half. 0:11:01.920 --> 0:11:03.839 Four Mets named to play the next BIGS All Star 0:11:03.920 --> 0:11:06.959 Game in l a Edwin Diaz, Peterlonzo, Jeff McNeil, and 0:11:07.000 --> 0:11:10.640 Sterling Marque. Four Yankees were named Garrett Cole, Estor Cortez, 0:11:10.720 --> 0:11:13.560 Clay Holmes, and Jose Chavino. Aaron, Judge and Stanton had 0:11:13.559 --> 0:11:16.520 already been being as starters. The year began for Novak 0:11:16.559 --> 0:11:18.920 Djokovitz when he went to Australia and wasn't allowed to 0:11:19.000 --> 0:11:21.360 play and due to being unvaccinated, he lost at the 0:11:21.400 --> 0:11:24.360 French but he just won Wimbledon for the fourth grade time. 0:11:24.400 --> 0:11:26.520 I don't take anything for granted. I'm very blessed to 0:11:26.559 --> 0:11:29.760 be in this position, and especially considering everything that that 0:11:29.960 --> 0:11:32.280 happened this year. At the beginning of the year, I 0:11:32.440 --> 0:11:35.920 just didn't feel emotionated a good place for for several months, 0:11:35.960 --> 0:11:39.599 and I was kind of trying to find the serenity 0:11:39.800 --> 0:11:41.920 and uh, you know, the balance on and off the 0:11:41.960 --> 0:11:44.360 court and uh and and get get myself in a 0:11:44.400 --> 0:11:46.559 position to fight for a big trophy. Zokovitz, now with 0:11:46.640 --> 0:11:50.040 twenty one career Grand Slam titles won more than Roger Federer, 0:11:50.120 --> 0:11:53.200 won fewer than Raphael the Dow, John Stasha Howard, Bloomberg 0:11:53.200 --> 0:11:56.600 Sports Thanks John SMP futures down twenty Dow futures down 0:11:56.640 --> 0:11:59.320 a hundred forty. Nasdaq futures are lowered by eighty two 0:11:59.400 --> 0:12:03.200 points tenure Treasury yield three point zero six per cent. 0:12:03.440 --> 0:12:08.959 This is Bloomberg Bloomberg eleven three oh weather, sunshine and 0:12:08.960 --> 0:12:11.839 a high your eighty five today, chance draftnion showers or 0:12:11.840 --> 0:12:14.400 thundershowers tomorrow going up to near ninety. It will be 0:12:14.480 --> 0:12:18.160 mostly sunny near ninety on Wednesday right now seven in 0:12:18.240 --> 0:12:24.960 Central Park Markets. Headlines and breaking news twenty four hours 0:12:25.000 --> 0:12:28.199 a day at Bloomberg dot Com, The Bloomberg Business Outland 0:12:28.320 --> 0:12:31.839 at Bloomberg Quick Take. This is a Bloomberg business lash 0:12:37.720 --> 0:12:40.600 and I'm Cameron. Moscow and European stocks are dropping along 0:12:40.640 --> 0:12:43.480 with US stock index futures as traders await the keys 0:12:43.520 --> 0:12:46.640 second quarter earning season for indications on how companies are 0:12:46.679 --> 0:12:50.360 weathering the inflation storm, the dollars jumping, bonds gaining. We 0:12:50.480 --> 0:12:52.920 checked the markets every fifteen minutes throughout the trading day 0:12:53.040 --> 0:12:56.880 on Bloomberg SNP futures down nineteen points this morning, down 0:12:56.880 --> 0:12:59.360 futures and a hundred twenty eight and NASTAG futures down 0:12:59.440 --> 0:13:02.360 seventy nine. The docks in Germany's down seven tenths of 0:13:02.440 --> 0:13:05.319 a percent. Ten Your treasury at five thirty seconds, you 0:13:05.400 --> 0:13:07.400 have three point oh five percent, a yield on the 0:13:07.480 --> 0:13:10.520 two year three point oh six percent. Nine x Scrude 0:13:10.559 --> 0:13:13.480 oil is down one downe about one percent on a 0:13:13.559 --> 0:13:15.960 dollar eleven at a hundred three dollars sixty five cents 0:13:16.000 --> 0:13:18.160 a barrel. COMEX school down three tenths per cent or 0:13:18.200 --> 0:13:21.120 five dollars forty cents at seventeen thirty six nine ounce, 0:13:21.520 --> 0:13:24.520 the euro one pot one seven against the dollar British 0:13:24.520 --> 0:13:27.000 bound one point one nine six six and the end 0:13:27.040 --> 0:13:30.440 at one thirties seven. And Bitcoin this morning lower down 0:13:30.440 --> 0:13:33.560 about two percent at twenty thousand, five hundred sixty dollars. 0:13:33.880 --> 0:13:36.480 That's a bloomberg business flash. Now here's Michael Barr with 0:13:36.640 --> 0:13:39.240 more on what's going on around the world. Muchael, Good morning, 0:13:39.360 --> 0:13:42.640 Good morning, Karen. Dozens of Ukrainian emergency workers are trying 0:13:42.679 --> 0:13:45.320 to pull people out of the rubble after a Russian 0:13:45.480 --> 0:13:51.080 rocket attacked and smashed into three apartment buildings in eastern Ukraine. 0:13:51.440 --> 0:13:54.920 At least eighteen people were killed. Former Trump wind out 0:13:54.960 --> 0:13:57.960 strategis Steve Bennon says he is now willing to testify 0:13:58.080 --> 0:14:01.440 before the House Committee investigate think the January sixth sold 0:14:01.520 --> 0:14:04.440 on the Capitol. Bennon's attorney says his client is willing 0:14:04.480 --> 0:14:08.240 to cooperate because the former president has rescinded his claim 0:14:08.360 --> 0:14:11.480 of executive privilege, even though Bennon was a private citizen 0:14:11.559 --> 0:14:13.920 at the time of the riot. In baseball, the Yankees 0:14:14.040 --> 0:14:17.000 lost to the Red Sox eleven six. The Mets lost 0:14:17.160 --> 0:14:19.880 along with the Nationals and A's. The Orioles won their 0:14:19.960 --> 0:14:23.600 eighth straight. The Giants won Global Needs twenty four hours 0:14:23.640 --> 0:14:26.600 a day on air and on Bloomberg Quick Takes, powered 0:14:26.640 --> 0:14:29.120 by more than twenty seven hundred journalists and analyists more 0:14:29.160 --> 0:14:32.000 than a hundred twenty countries. Michael bar This is Bloomberg. 0:14:32.480 --> 0:14:34.960 Thanks Michael. It's five nineteen on Wall Street Live from 0:14:35.000 --> 0:14:38.480 the Bloomberg Interactive Broker Studios. This is Bloomberg Daybreak. We 0:14:38.560 --> 0:14:40.520 want to get back to our top story this morning. 0:14:40.600 --> 0:14:43.880 The saga over Elon must bid to buy Twitter is 0:14:43.960 --> 0:14:46.280 now headed to chord with the world's richest man now 0:14:46.440 --> 0:14:49.880 trying to walk away from the forty four billion dollar deal. 0:14:50.320 --> 0:14:53.040 From what We're joined by Alex Webb, Bloomberg Quick Take 0:14:53.120 --> 0:14:57.320 anchor and tech columnists for Bloomberg Opinion. Alex, good morning. 0:14:57.480 --> 0:15:01.480 This has been quite the saga to watch. Let's talk 0:15:01.640 --> 0:15:05.640 about how both sides got to this point and the 0:15:05.760 --> 0:15:10.880 dispute over bots on Twitter. It's certainly it's are is 0:15:10.880 --> 0:15:14.440 certainly the right word. There's been increasing volume from Ellen 0:15:14.560 --> 0:15:18.080 over the past few months since the two long since 0:15:18.120 --> 0:15:22.360 the deal was agreed, that he thinks that there are 0:15:22.640 --> 0:15:25.160 Twitter has more bots than its reporting. Twitter says that 0:15:26.560 --> 0:15:30.440 less than five percent of its users are bots, and 0:15:30.880 --> 0:15:32.520 Elon seems to think it's a lot more. That he 0:15:32.520 --> 0:15:35.160 hasn't quite provided the evidence as to why. Now. I 0:15:35.240 --> 0:15:40.680 think there may be a discrepancy here between the amount 0:15:41.080 --> 0:15:43.400 of engagement the Elon sees on his own accounts and 0:15:43.440 --> 0:15:46.720 he sees a lot of bot engagement and how many bots? 0:15:47.280 --> 0:15:51.040 How how many Twitter users Twitter reports as active users? Right? 0:15:51.080 --> 0:15:54.640 So when Twitter says it has eighty million daily active users, 0:15:55.480 --> 0:15:59.120 it probably doesn't include bots in those numbers, right, And 0:15:59.200 --> 0:16:03.440 so that's the maybe there are accounts using Twitter every day. 0:16:03.440 --> 0:16:04.800 I'm making that number up. We don't know women that 0:16:04.920 --> 0:16:07.080 might be, and maybe half of those are boats for 0:16:07.160 --> 0:16:10.000 argument's sake, so that might be where we're seeing the disparity. Now, 0:16:10.040 --> 0:16:12.440 that's interesting that you point out that perhaps Elon Musk 0:16:12.560 --> 0:16:14.800 is looking at his own Twitter account as opposed to 0:16:15.080 --> 0:16:18.600 the fire hose of data that Twitter says it has 0:16:19.000 --> 0:16:22.360 handed over to Elon Musk, something that that the that 0:16:22.520 --> 0:16:25.360 Musk had been asking for. I mean, what is his 0:16:25.480 --> 0:16:28.320 focus here? Well, that kind of gets to another the issue, 0:16:28.400 --> 0:16:30.800 namely that is this really about the bots or is 0:16:30.880 --> 0:16:34.200 it about the fact that tech stocks and social media 0:16:34.200 --> 0:16:37.120 stocks in particular are down a lot since that deal 0:16:37.280 --> 0:16:41.000 was announced, and so there's a lot of expectations. You know, 0:16:41.120 --> 0:16:45.640 some analysts saying that if the deal completely falls apart, 0:16:45.760 --> 0:16:48.720 they see a bottom for the stock at twenty three dollars. 0:16:48.800 --> 0:16:52.000 That's considerably less than half of the four dollars twenty 0:16:52.120 --> 0:16:54.280 which he agreed to take it private. So, you know, 0:16:54.800 --> 0:16:56.400 is this really to do with bots or is it 0:16:56.560 --> 0:16:59.240 just Elo going, God, I'm over paying for this deal 0:16:59.760 --> 0:17:01.600 and therefore I need to find a way of backing 0:17:01.640 --> 0:17:03.800 out of it. There's a heavy suspicion that it's the latter, 0:17:04.200 --> 0:17:06.600 and right now in the pre market, Twitter is trading 0:17:06.640 --> 0:17:10.360 at about thirty four fifty, which obviously the fifty four 0:17:10.560 --> 0:17:14.119 twenty offer is a huge premium still even if Twitter 0:17:14.359 --> 0:17:18.119 hasn't reached bottom. Here with the possibility and the likelihood 0:17:18.160 --> 0:17:21.399 now that this dispute is headed to court in Delaware, 0:17:21.560 --> 0:17:26.760 what's the burden of proof? Elon seems to think that 0:17:26.840 --> 0:17:29.480 Twitter is going to have to provide the the the 0:17:29.880 --> 0:17:32.640 number of bots he's been tweeting memes saying to the case. 0:17:32.760 --> 0:17:36.399 Ultimately he needs to prove that they're wrong, not the 0:17:36.480 --> 0:17:41.800 other way around. And generally these the Delaware Delaware courts 0:17:42.320 --> 0:17:44.920 tend to um sit on the side that if a 0:17:44.960 --> 0:17:48.400 deal has been agreed, a deal has to be completed. 0:17:50.040 --> 0:17:52.800 The case that a lot of people have been pointing 0:17:52.840 --> 0:17:55.560 towards and um is kind of important in the case 0:17:55.680 --> 0:17:59.160 law is about twenty five years ago, around the turn 0:17:59.200 --> 0:18:02.240 of the millennium, UH, there was a deal in the 0:18:02.400 --> 0:18:06.800 meat industry whereby Tyson Foods agreed to acquiet then rival 0:18:06.920 --> 0:18:09.600 I P b Um for about three and a half 0:18:09.720 --> 0:18:12.760 or three point two billion dollars. And in the meantime 0:18:12.800 --> 0:18:17.680 between the deal being agreed and incompleted, there was a downturn, 0:18:17.800 --> 0:18:20.320 and so the value of the company declined as well, 0:18:20.440 --> 0:18:22.480 so Tyson tried to back out of the deal. They 0:18:22.560 --> 0:18:24.879 were forced to complete it. Now three point two billions 0:18:24.920 --> 0:18:28.040 clearly far different scale from forty four billion. We weren't 0:18:28.040 --> 0:18:30.959 even really sure that Elon definitely had the financing lined up, 0:18:31.040 --> 0:18:34.320 So that is another layer of complication. Um in some 0:18:34.560 --> 0:18:37.040 cases it arrives at a settlement, but the burden of 0:18:37.080 --> 0:18:39.560 proof seems to be on Elon about at the last 0:18:39.600 --> 0:18:42.560 minute here, Alex, what is the likelihood that all this 0:18:42.840 --> 0:18:45.600 is just a negotiating tactic on Elon must part in 0:18:45.680 --> 0:18:50.399 this does end up in a settlement. I mean, I 0:18:50.480 --> 0:18:52.760 don't know. We don't know what's in the Elon's mind. 0:18:53.000 --> 0:18:55.720 Guessing what Elon's thinking is a very difficult thing to do. 0:18:56.480 --> 0:18:59.159 If it's not a negotiating tactic. I think it is 0:18:59.200 --> 0:19:01.920 certainly an element to back out. There's a high challenge. 0:19:01.960 --> 0:19:03.800 It's an element. It's an effort to back out because 0:19:03.880 --> 0:19:06.000 the prices change, right, it's and he looks like he's 0:19:06.000 --> 0:19:08.880 overpaying at this stage. So whatether that means he would 0:19:08.880 --> 0:19:10.639 come back to the table if he was able to 0:19:10.840 --> 0:19:13.520 back out and and an agree at lower price. I'm 0:19:13.560 --> 0:19:16.800 not sure that's the case given the kind of the 0:19:16.920 --> 0:19:20.480 face that he's lost in recent months. And again, Twitter 0:19:20.600 --> 0:19:24.480 shares dropping by about six and a quarter percent for 0:19:24.640 --> 0:19:28.159 a value about thirty four fifty a share in the 0:19:28.240 --> 0:19:32.520 pre market as we watch this battle potentially head now 0:19:32.640 --> 0:19:36.879 to court in Delaware. Alex Webb, Bloomberg Opinion, tech columnists 0:19:36.960 --> 0:19:40.040 and anchor on Bloomberg Quicktake. As always, thanks for the 0:19:40.119 --> 0:19:43.560 insights as we continue to watch the saga unfold. Right now, 0:19:43.720 --> 0:19:46.560 SMP futures are down twenty point, staff futures down a 0:19:46.640 --> 0:19:49.560 hundred thirty six. NASDAC futures are lower by eighty four points. 0:19:50.119 --> 0:19:54.680 Tenure treasury up six thirty seconds, the yield three point 0:19:54.760 --> 0:19:57.000 zero five percent, and the yield on the two year 0:19:57.280 --> 0:20:00.600 almost three point zero seven percent. Still invert Jian between 0:20:00.680 --> 0:20:03.160 twos and tense. You're listening to the Bloomberg Day Break 0:20:07.640 --> 0:20:09.800 Bloomberg eleven three oh weather. Sunshine with a high near 0:20:09.880 --> 0:20:12.200 eighty five today. It's gonna be mostly sunny tomorrow, but 0:20:12.480 --> 0:20:15.800 could see an afternoon shower thundershower tomorrow on Wednesday. Both 0:20:15.880 --> 0:20:18.919 days near ninety degrees. Right now sixty seven in Central 0:20:19.000 --> 0:20:29.000 Park broadcasting live from the Bloomberg Interactive Broker Studio in 0:20:29.080 --> 0:20:32.119 New York. Bloomberg E living free to Washington, d C, 0:20:32.320 --> 0:20:36.000 Bloomberg nine one to Boston, Bloomberg one oh six, one 0:20:36.119 --> 0:20:39.960 to San Francisco, Bloomberg sixty to the country, Sirius XM 0:20:40.080 --> 0:20:42.879 to A one nineteen and around the globe to Bloomberg 0:20:42.920 --> 0:20:47.360 Business app in Bloomberg Radio dot com. This is Bloomberg Daybreak. 0:20:53.320 --> 0:20:55.480 It's five thirty on Wall Street. Good morning. I'm Nathan 0:20:55.520 --> 0:20:58.760 Hager and I'm caring Moscow or just about four hours 0:20:58.840 --> 0:21:00.840 away from the open of US training. Let's get you 0:21:00.880 --> 0:21:02.200 have to day on the news you need to know 0:21:02.280 --> 0:21:04.760 at this hour, and we begin at the latest. On Twitter, 0:21:05.119 --> 0:21:07.400 Twitter shares are down more than six and a half 0:21:07.480 --> 0:21:10.000 percent in early training. Is the show down between Elon 0:21:10.119 --> 0:21:12.919 Musk and a social media company appears to be headed 0:21:12.960 --> 0:21:15.320 to court Bloomberg's or need a young joins us live 0:21:15.359 --> 0:21:17.760 at the latest, or need a good morning, Good morning Karen. 0:21:17.880 --> 0:21:20.480 Even though Elon Musk is backing out of the forty 0:21:20.520 --> 0:21:23.240 four billion dollar deal to buy Twitter, after all, he 0:21:23.400 --> 0:21:26.679 can't just walk away without a court case, and Twitter 0:21:26.800 --> 0:21:29.200 has lawyered up in a race to sue Musk to 0:21:29.320 --> 0:21:32.600 follow through Bloomberg. Sources say a filing could come as 0:21:32.680 --> 0:21:35.320 soon as early this week. Now, if the judge rules 0:21:35.320 --> 0:21:38.560 against Musk, he could be forced to pay Twitter shareholders 0:21:38.640 --> 0:21:41.200 fifty four dollars and twenty cents a share. But a 0:21:41.320 --> 0:21:44.280 ruling in his favor would let Musk walk, although he 0:21:44.440 --> 0:21:47.359 probably have to pay a one billion dollar breakup fee, 0:21:47.640 --> 0:21:50.400 and there's also the prospect that both sides could reach 0:21:50.440 --> 0:21:53.080