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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 move we're seeing in markets this morning comes on optimism that trade tensions between the US and China may be easing. China says it is assessing the possibility of trade talks with the US. It is the first sign since President Donald Trump hiked tariffs last month that negotiations could begin between the two sides. We get more from Bloomberg New senior editor Bill Ferries.
It's really hard to know what's happening here or if it's the market really looking for any sign of a potential change, any sign that one side or both sides are simultaneously starting to blink here. I mean, the China's Commerce Ministry said on Friday that it noted the willingness of some senior US officials to talk about harriffs. On the other hand, you've had the US saying that they want China to reach out, that China can't sustain these
tariffs for very long. This latest statement doesn't seem that different on the Chinese side, but it is being taken as perhaps an ALI branch that could allow both sides to maybe save some face and start talks, even if that's at.
A lower level and Bloomberg's Bill Ferry says, the economic fallout from the confrontation maybe giving new momentum to efforts to bring both sides to the table. The US economy contracted at the start of the year, China's factory activity slipped into its worst contraction since December of twenty twenty three.
Let's turn to politics now, Nathan.
The White House is set to release its first budget request of President Trump's second term, the so called the Skinny Budget. We'll call for five hundred and fifty seven billion dollars in non defense spending. That's a nearly twenty three percent drop from current levels. National security spending, meanwhile, would rise to a record one point zero one trillion
dollars thirteen percent increase. Administration officials say the budget includes significant cuts to environmental programs, foreign aid, the Education Department, National Institutes of Health and Housing, and urban development. The military boost would pay for the Golden Dome missile defense, as well as shipbuilding, border security, and a military pay raise. It's not clear how the budget request would handle entitlements. They represent the bulk of federal spending.
And Karen, the president has signed an executive order to end federal funding of public broadcasters NPR and PBS. Bloomberg's John Tucker joins us with that part of the story.
John and Nathan, the most shouldn't really come as a surprise. Back in March, President Trump was asked if he had any plans to yank funding for NPR and PBS.
I would love to do that.
I think it's very unfair.
It's been very biased. The whole group, I mean the whole group of them.
Or Republicans have long sought to eliminate funding for NPR and PBS, and President Trump has repeatedly criticized press coverage of his administer. Both public media outlets do receive a small portion of their funding from the federal sources. PBS is set to take the larger hit. The broadcaster relies on federal funds for about sixteen percent of its overall budget. You know you yorkcome, John Tucker, Bloomberg Radio.
All right, John, thank you a while.
The other major story out of Washington, as a shake up in the West wing, President Trump is naming his national Security Advisor Mike Waltz to be the next UN ambassador. Back in March, Waltz admitted he mistakenly added Atlantic Editor Jeffrey Goldenberg to a signal group chat about attack plans in Yemen. Now, if confirmed by the Senate, he'll be moving out of the Oval Office to UN headquarters in New York, began more from Bloomberg Washington reporter Tyler Kendall.
In terms of a promotion versus a demotion, the National Security Advisor is in the West Wing. He sees the President every day. He gets a security detail much like the chief of Staff that other members of the administration don't necessarily get. He also has been at the forefront of most of, if not all, of these foreign policy negotiations, particularly when it comes to Ukraine and Russia. As the administration tries to push forward that they are making progress.
They're announcing that a critical minerals agreement just the other day. He was the one that went to Saudi Arabia to kick off those talks.
And that's Bloomberg's Tyler Kendall. The president says Secretary of State Marco Rubio will serve as interim National Security Advisor Rubio is also leading the US Agency for International Development after it was targeted for cuts, and he's also acting head of the National Archives and Karen.
President Trump is putting new pressure on Iran. He says he will impose secondary sanctions on nations or companies that buy Iran's oil. The president posted on social media quote, they will not be allowed to do business with the United States of America in any way, shape or form. Negotiations over Iran's nuclear program hit a wall this week.
A meeting that had been set for tomorrow was postponed, and US officials said they never agreed to take part in the latest stround of talks in the first place.
Return to the markets now, Nathan, in futures are high. You're following eight straight days of gains for the S and P five hundred. As you mentioned earlier, there is optimism the US and China will begin trade negotiations. Two stocks that are not participating in the euphoria are Apple
and Amazon. Shares of Apple are down three percent. The iphonemaker's earnings report failed to soothe investor concerns about its biggest challenges, including escalating tariff costs and a slowdown in China CEO Tim Cooks as sales from China fell more than expected two point three percent to sixteen billion dollars in the second quarter. Analysts say that shortfall is an ominous sign for what was once a growth market.
And here and shares of Amazon are down more than two percent. The world's largest online retailer says it's bracing for a tougher business climate due to tariffs and economic turmoil. Amazon CEO and the jazz highlighted at the guaranty.
Obviously, none of us know exactly where tariffs will settle or when.
We haven't seen any attenuation of demand yet.
To some extent, we've seen some heightened buying in certain categories that may indicate stalking up in advance of any potential tariff impact.
And despite the headwinds, Amazon CEO Andy Jassey reported a nine percent increase in first quarter sales.
In addition to earnings, Nathan, Investors will have a key economic report to look forward to, the April Jobs report. We get a preview with Bloomberg's Michael McKee.
The jobs report may be the most important economic indicator going forward, but maybe not this one. The President's big tariff announcements came just ahead of the April survey week, so companies likely didn't have a lot of time to react. We may see some reduction in federal government employment, but for the most part, the April figures should suggest private sector hiring is on hold. Also, the FED watch is the unemployment rate rather than overall job creation, and unemployment
is forecast to hold steady. Michael McKee, Bloomberg Radio.
All right, Mike, thanks well.
Stay with Bloomberg for special coverage as we break down the numbers and get live expert analysis. That's at eight thirty Wall Street time on Bloomberg Radio and the Bloomberg podcast page on YouTube. 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.
Supreme Court Justice Katanjie Brown Jackson denounced what she called relentless attacks on the federal judiciary. Jackson says efforts to intimidate judges we're threatening the constitution and the rule of law. She told a group of federal judges and lawyers at a conference in Puerto Rico last night. The attacks are not random. The Transportation Department is rolling out a new plan to address a shortage of air traffic controllers across
the country. The new initiatives include financial incentives to graduates. National Air Traffic Controllers Association President Nick Daniels says staffing at US airports is nearing a thirty year low.
This is a commitment to the dedicated men and women keeping our skies safe. It's a real tangible move towards building and sustaining the workforce that America needs.
It's part of what caused a domino effect delaying air traffic for several days at Newer Careport. New York Governor Kathy Hockel join MTA officials and law enforcement to highlight a state budget deal to make subways safer for all riders and transit workers. Hochel, speaking from a subway station, says, these major investments increase the presence of law enforcement and make crucial safety upgrades and protective barriers and.
May be overstated, but this is the beating heart of this city. This is what sets us apart from all others, gets getting people anywhere.
They want to go within minutes. It's extraordinary.
The State Department says Secretary Marco Rubio has spoken with senior officials in India and in Pakistan in an effort to cool tensions. Pakistan's ambassador to the US, Risman Sayeed Shaik, stresses that they want peace, but his country will stand up for itself.
We need a peaceful neighborhood, and any allegations of that sort, they would need evidence.
It comes after a deadly attack on Cashmere. Detailed Army plans for a potential military parade on President Trump's seventy ninth birthday call for more than sixty six hundred soldiers, at least one hundred and fifty vehicles, fifty helicopters, and seven bands. According to the Associated Press, the planning documents represent the army's most recent blueprint for its long planned two hundred and fiftieth birthday festival on the National Mall.
June fourteenth, Global News twenty four hours a day and whenever you want it with the Bloomberg News Now, Michael Barrn this is Bloomberg.
Karen.
All right, Michael barr thank you time now for the Bloomberg Sports Update. Here's John Staneshawer.
John, good morning, and we want to care in wild game to and a wild series one where the road team won five games in a row and each of the last four games were decided by no more than three points. Game six of Detroit Knicks had a great start, led by fifteen, but as was so often the case of the series, the Pistons responded. They had the lead by halftime, a strong third quarter, by the next they
were backhead by thirteen. Sure enough, it was the Pistons turn a twenty to two run on the fourth quarter a seven point lead, and everyone then expecting there to be a Game seven back in New York, but the Knicks Valley had the ball with the game tie, brusts and.
Holding X trying to win till the ends.
Romson pucks up the three tag, Jalen Bruson hits the three with.
Four point three reding of the Pistons call time out.
And Mike Breen saves those double bangs on MSG for really big shots. This one a series winner by Brunson, who scored forty points as the Knicks won one sixteen, one thirteen to take the series for two and advance to play the heavily favored Celtics. Game one Monday, in Boston. Detroit still winless in home playoff game since two thousand and eight. Denver and the Clippers headed into a game seven. LA won one eleven one oh five. Three teams moving
around two of the Stanley Cup playoffs. Toronto, Vegas and Edmonton, Colorado beat Dallas. They'll play a game seven. It appears the Rangers have their new coach contract Top said to be advanced with fifty seven year old Mike Sullivan, drafted by the Rangers in nineteen eighty seven, that we never played for them. He got fired by Pittsburgh three days ago after spending a decade coaching the Penguins, winning two
Stanley Cups. Just the second two game losing streak for the Mets Arizona one at City Field, four to two too. The two met runs were solo homers by Juan Soto, his first two homers hit at home. Met's played tonight in Saint Louis. Yankees are home for Tampa Bay. Toronto beat the Red Sox for to two. The Nationals won four to two in Philadelphia. John Stashewer Bloomberg Sports count Nathan.
Coast to Coast on Bloomberg Radio nationwide on Sirius XM and.
Around the world on Bloomberg dot Com and the Bloomberg Business app.
This is Bloomberg day Break. Good morning, I'm Nathan Hager.
On a morning we may be seeing the first sign of a thaw in the trade freeze between the US and China. With one hundred and forty five sent tariff's still an effect on Chinese exports. The Chinese Commerce Ministry now says it is evaluating the possibility of trade talks after getting messages from the US through relevant parties. John Gong is a former consultant to the Commerce Ministry. We've
been waiting for this for a long time. I think the statement that the Ministry of Commerce is evaluating really means that, first of all, there's a go ahead from the very top of the leadership in China. John Gong, now with the University of International Business at Economics, spoke with Bloomberg from Beijing this morning, and we're joined now by Bloomberg Radio and TV anchor Kritty Gupta. So, Critty, how to take this statement from the Commerce ministry that they're thinking about thinking.
About talks with the US.
It almost feels like how the FED used to talk about thinking about thinking about doing something with Tristrad.
It's good morning.
Good morning, Nathan.
Yeah, it's a tricky one because, of course we know a CCTV, which is media in China associated with the Government of China earlier reported that that was kind of happening earlier this week. So this is a confirmation now from the government itself that this is largely being considered.
I think one guest this morning that I think summed it up perfectly, so that this is a drizzle in what's been a drought for weeks, if not months, and I think that's one way to kind of assess perhaps the early though that we're seeing in this terms of relationship.
But wishure remind our audience.
That this is just what we're hearing from China is coming amid a backdrop of what Donald Trump has repeatedly emphasized it needs to be the first step that comes from China and not from Washington, d C. Whereas he's also said in previous iterations that Shijinpin needs to contact
him directly in order to begin talks. Got best and saying something similar, and that's up to Beijing to take the first step to de escalate the dispute, so we will actually see if China does that when they've repeatedly asked for respect when.
It comes to taking that step.
Well, you had to think Critty that both sides have sort of motivation to get to the table.
After the GDP.
Read we got here in the US and the shrinking factory activity that we saw to China.
They absolutely have motivation.
I would argue that the push from the American side may have to do with some of the early readings on the tariff impact that you're already seeing. And I think a great example in just the last twenty four hours of that has been coming out of Apple and Amazon, who are already seeing pressures.
That are going to ultimately fall on the consumer.
Nathan, if I can go there and drive some numbers around this, sure, Apple is a great example. They're talking about a nine hundred million dollar cost in the current period when it comes to the effect of the planned tariffs, and that's just on one quarter. The SZILL hasn't fully had the full effect. Not to mention what happens when the ninety day reciprocal tariff kind of extension happens as well.
Amazon is another great example, really talking about headwinds when it comes to tariff related turmoil, and we know that this week as well, that was something that became a bit of an issue, as you know in Washington, DC as well, where it was reported and then later denied by Amazon that tariff prices may show up in some of the kind of the the number you see at the checkout for example when you buy something from Amazon, something that did of course get the ire of Washington
and the Trump administration. Of course, Amazon pulling back on those comments, saying that it was never going to happen. But I think it really highlights the uncertainty that a lot of these corporations are dealing with when it comes to keeping the consumer engaged while also adding pressure to the Trump administration.
So just quickly, critty, what's the signal we could be taking from the market with the broader market moving higher while these big tech names are still moving lower on some of these ongoing trade concerns.
Well, if you do start to see green on the screen in today, sustain into the weekend, it would be the nine straight winning day for the S and P five hundred. That is the biggest winning streak going back to twenty twenty one, so we'll see if that is ultimately a sentiment change. But again we're going into a weekend. Anything can happen.
This is Bloomberg Daybreak, your morning podcast on the stories making news from Wall Street to Washington and beyond.
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