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Good morning.
I'm Nathan Hager and I'm Karen Moscow. Here are the stories we're following today.
Karen, the ceasefire between the US and Iran has turned into a standoff over control of the crucial straight of horror moves. President Trump says the truce will stay in effect indefinitely until Iran comes to the table with a new peace proposal. White House Press Secretary Caroline Levitt says the President has no timetable.
I know there's been some anonymous, sourced reporting that there was maybe a three to five day deadline.
That is not true.
The President has not set a deadline himself. Ultimately, he will dictate the timetable.
Press Secretary Caroline Levitt at the White House. For its part, Iran says it has no immediate plans to take part in negotiations. Iran's president posted on social media that the US blockade and threats are main obstacles to diplomacy. Bloomberg's Juman has more from Dubai.
You've still got two boockades in place. The strait is still not safe, and it is a deadlock between the two sides and the question here is whose side is time on, because the longer this goes on for the more you're going to see upper pressure on oil prices. Already, we're beginning to see that public There's been public backlash in the US against the war and against President Trump
himself and his handling of the war. At the same time, President Trump also maintains that this is costing Iran five hundred millions dollars a day the blockades, and again we haven't been able to verify those numbers, but it is a battle of the wills here.
Bloombergs Jumani Barsecci reports Iran is maintaining its own blockade, firing on ships and reportedly seizing at least two of them. The Washington Post reports the Pentagon told Congress this week that clearing minds from the Strait of hormones could take up to six months.
Nathan, With the war still unrigolved, there's been another high profile shake up at the Pentagon. Maybe Secretary John Feelin has been fine, and we get more with the Bloomberg Deputy Washington Bureau Chief Laura Davison.
Just earlier this month, it was a dispute about promoting specific generals that was the top uniformed officer at the Army and just yesterday the top civilian leader at the Navy. Also, after clashing with Stephen Finberg, who's the Deputy Defense Secretary in Pete Heggs at the Defense Secretary over shipbuilding priorities also was asked to resign.
Bloomberg's Laura Davison reports fhelanz Auster is not expected to affect Navy operations around the Strait of Horror moves. He's being temporarily replaced by Under Secretary Honk how Well.
Meanwhile, Karen Treasury Secretary Scott Besson has told lawmakers many Persian Gulf allies and some Asian nations have requested foreign exchange swap lines with the US. We get more from Bloomberg Zamy Morris in Washington.
Swap lines allow one nation to deploy the currency of another as needed to address liquidity demands. During his testimony before the Senate Appropriation Subcommittee, Treasury Secretary bess And told lawmakers that Persian Gulf allies are asking for swap lines with the US.
Swap lines, whether it's from the Federal Reserve or the Treasury, are to maintain order in the dollar funding markets and to prevent the sale of US assets in a disorderly way.
Besant also pointed to the potential for swaplines to support dollar denominated lending overseas. In Washington, Amy Morris Bloomberg Radio.
Right, Amy, thank you. On Capitol Hill, the Senate worked through the night into this morning to take a first step to reopen the Department of Homeland Security. Republicans approved a seventy billion dollar budget plan to fund ice and border patrol through a process that requires no Democratic votes. Democrats proposed a series of amendments focused on lowering healthcare and other costs.
The bill now heads to the House.
Where Speaker Mike Johnson can't afford to lose just two Republicans to pass the narrow spending plan. Some Republicans are pushing him to go for an even bigger affordability ahead of November's midterms.
Let's turn to the markets now, Karen. A record setting rally is taking a pause right now, as peace talks in the Middle East remain in limbo. The S and P five hundred is coming off another record close. It has now gained more than nine percent this month, and the Nasdaq one hundred also closed at an all time high.
Oil is on the rise as well.
West Texas Intermediate's up about two and a half percent at ninety five dollars thirty four cents of barrel Brent is at one hundred and four to fifty.
That's a gain of two and a half percent.
Nathan Tesla unveiling plans for a massive ramp up in spending on AI and robotics. The electric car maker says capital expenditure will triple to more than twenty five billion dollars. CEO Elon Moscow line the expansion plan during the earnings call.
I think you've seen most, if not all, certainly the major technology companies substantially increasing their CAPO investments and U and we're going to be doing the same. I think it's uh, it's just going to pay off in a very big way.
That's CEO Elon Musk, who spoke as Tesla for the second quarter in a row, announced better than expected earnings and shares of Tesla. They're down three point two percent in early trading.
And the earning sprey continues today, Karen, with more than thirty companies reporting, including chip maker Intel. Bloomberg's Tom Busby has a preview.
Keifer investors Intel's efforts to restore its technological edge and benefit from the extraordinary demand for all things AI related. Also of note any update on Intel's admission three months ago that it hadn't devoted enough production to server chips and at that time was not able to meet all
the orders that came in. Bloomberg consensus calls for revenue of twelve point three six billion dollars, more than half of that from client computing, on adjusted earnings for share of one cent and Intel shares of about eighty percent so far this year.
Tom Busby, Bloomberg Radio.
All right, Tom, thank you well. It's been quite a run for Intel and the rest of the chip stocks. In fact, it's been a historic one. The Philadelphia Semiconductor Index is now gained for a record sixteen straight sessions. It's up thirty percent in April and set for its second best month ever that was set in two thousand and We.
May see more gains today. Karen Texas Instruments gave a surprisingly strong forecast, helped by booming spending on data centers and industrial equipment. Those shares are up more than ten percent in early trading well.
On the flip side, software related stocks are under pressure this morning. Nathan shares of IBM there down seven and a half percent. Big Blue it posted quarterly sales and its software unit now we're in line with estimates, but that's failing to shake investor concerns about AI disruption to its business. Shares of service now they're also lower, down
more than thirteen percent. The provider of software for business Task reported results that disappointed investors and said some sales deals have been delayed by the war in the Middle East.
Well, Microsoft is making a deal Karen, announcing its biggest ever investment in austral pledging to spend almost eighteen billion dollars by the end of twenty twenty nine as it pushes deeper into the artificial intelligence market in the Asia, Pacific.
And Robinhood markets. Nathan expanding its global footprint. The financial technology company has received an initial regulatory stamp of approval in Singapore to offer brokerage services. Robinhood first announced it would be expanding into Asia and December twenty twenty four, eyeing Singapore for its headquarters. Time now for look at some of the other stories making news in New York and around the world. And for that we're joined by Bloomberg's Michael Barr Michael, good Morning, Good.
Morning, Karen. Health Secretary Robert F. Kennedy Junior concluded a marathon of budget hearings with federal lawmakers on Capitol Hill. Kennedy was grilled on the country's worst measles outbreak in decades. This heated exchange was between Kennedy and Democratic Senator at Lisa Blunt Rochester of Delaware.
Does the President know there is a historic measle surge occurring nationwide?
You want me to answer the question. It's just a very simple question.
Yes, grandstand.
You're going to get your opportunity on.
A grant stand, can you answer? You can answer that question. Yes, just started before I came answer.
I'm there's oportunity to answer the question.
Does the President know there is a historic measle surge occurring nationwide?
I'm sure he does.
In response to bipartisan concerns about funding reductions, Kennedy said they were painful. Officials in West Virginia say two people were killed after a chemical leak at a plant just west of Charleston. More than a dozen others, including seven EMS workers responding to the leak were sent to the hospital. Governor Patrick Morsey the.
Families of those we lost today, our hearts are with you and are State griefs for you. We stand ready to support you in every way possible.
State officials say all shelter in place orders have been lifted. Georgia's Democratic Congressman David Scott has died at a eighty Scott was the first black chairman of the House Agriculture Committee and was seeking his thirteenth term in Congress. Scott's death creates a sudden fifth vacancy in the Chamber amid
three resignations just this month. Until special elections are held to fill the empty seats, there will be two hundred eighteen Republicans and two hundred twelve Democrats in the House. Global news twenty four hours a day and whenever you want it with Bloomberg News Now. I'm Michael Barr, and this is Bloomberg.
Hearron, Well, thanks Michael.
All time now for our Bloomberg Sports update, and for that we bring in John Stashauer.
That's during the NFL Draft again tonight in Pittsburgh. The Las Vegas Raiders set to take Indiana quarterback Fernando Mendoza first overall. He led the Hoosers the national championship, and he won the Heisman Trophy. The top seeds of the NBA Playoffs both won at home. That's Oklahoma City beat Phoenix once twenty to one oh seven. The Shay Gilgess Alexander scored thirty seven of the Thunder lead the series
two to nothing. Detroit, after losing Game one to Orlando, was tied at halftime, pulled away in the third to the Pistons beat.
The Magic ninety eight eighty three a to Bloomberg Sports Update.
Stay with us more from Bloomberg day Break coming up after this.
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This is Bloomberg Daybreak. Good morning, I'm Nathan Hager.
The ceasefire between the US and Iran has turned into a standoff over control of the Strait of Horror Moves. President Trump has said the truce could go on indefinitely, while hinting talks could happen this week. White House spokeswoman Caroline Levitt says, the timing is up to the president.
He is satisfied with the naval blockade, and he understands that Iran is in a very weak position and the cards are in President Trump's hands right now.
Press Secretary Caroline Levitt at the White House for more. We're joined by Bloomberg opinion columnist Mark Champion. Mark, it's good to have you with us. Where do things stand on this morning of what appears to be an indefinite truth between the US and Iran?
Good morning, Yes, So you know.
We are in a place where we, you know, just don't know whether the war will resume. It seems clear that neither side really wants that, and therefore you have this kind of standoff, overhauled moves, and the great difficulty in going back to talks because their positions are so distant from each other, and that runs from your homers. It's homos itself and the control of hormos that the Iranians want after the war. The Americans obviously do not
want that, nor do their allies in the Gulf. And then you have the nuclear file, you have but listed missiles, you have the whole range of things that we're under discussion before the war or at least the US wanted to be under discussion, and are still unresolved. Essentially, you know, the Iranians are still able to fire missiles, ballistic missiles, they are they still have a nuclear program, badly damaged, but it exists and they have not given up the
principle that they'll keep it. So, you know, we're really in this place where everything remains unresolved. The war has not achieved US goals. It's done enormous damage to the Uranian state and to its economy, and we're now in a standoff, and the question is who can.
Last longer well as this standoff continues, Mark, what's the potential economic impact. We've heard reports that just clearing the minds that Iran has laid through the and around the Strait of Hormus could take up to six months.
Yes, so you know, for now, you know, the oil price is up again above one hundred dollars. That's a you know, a significant increase from before the war. But it is quite manageable for you know, parts of the global economy. Certainly for the US it's a political issue, but it's a it's a manageable issue for the US.
Economy much harder in Asia, which relies very heavily on the Gulf for its oil, and there the issue is just the you know, physical supply that about ten percent of the world's supply has been taken off the market, and that is a very significant problem in Asia, which is the biggest consumer of Gulf oil, not so much for the US, which consumes rather little. It's just affected by you know, global price trends. So it's you know,
it's it is uncertain. The Iranians will also be hard hit, but they are still getting some tankers through the US blockade. Whether that is the US turning a blind eye because they don't want this to become an existential issue that prompts the Iranians to carry through on their threats to attack energy infrastructure in the Gulf, or whether they simply aren't able to control these ships once they turn off
their black boxes. It's not quite clear yet, but you know, it will it will take a toll on both sides.
This is Bloomberg Daybreak, your morning podcast on the stories making news from Wall Street to Washington and beyond.
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