Stocks Sell Off After Moody's US Downgrade; Nvidia Unveils New Tech | Bloomberg Brief 05/16/2025

♪ >> GOOD MONDAY MORNING, I'M DANI BURGER. LET'S SET YOUR AGENDA. A RATINGS CUT.

THE DOLLAR, TREASURIES ALL DIP AS 30 YEAR YIELDS TOUCH 5%. MOVING ALONG, THE HOUSE BUDGET COMMITTEE ADVANCES PRESIDENT TRUMP'S TAX BILL THAT COULD SPEED UP CUTS TO MEDICAID COVERAGE. AND NVIDIA UNVEILS NEW TECHNOLOGY TO KEEP UP WITH THE BOOM IN AI DEMAND.

IT IS A ROUGH MORNING IF YOU'RE JUST WAKING UP THIS MONDAY MORNING. STOCKS, THE DOLLAR, TREASURIES, ALL OF THEM UNDER PRESSURE. S&P, NASDAQ AND RUSSELL 2000 FUTURES ALL MORE THAN 1% THAT THE INDICES GAIN FOR ALL FIVE DAYS.

HOW QUICKLY THE NARRATIVE HAS PIVOTED FROM TARIFF DEALS TO CONCERNS ABOUT THE BUDGET. SAME GOES FOR YOUR TREASURY MARKET THIS MORNING UNDER PRESSURE. WE ARE BACK AT 5%, THE FIRST TIME SINCE NOVEMBER 2023 WHEN LESION CAN WERE FRONT AND CENTER.

BESIDES THAT YOU HAVE TO GO ALL THE WAY BACK TO 2007. THE DOLLAR FALLING BASICALLY AGAINST ALL OF ITS G10 PEERS THIS MORNING. LET'S LOOK AT SOME OF THE STOCKS UNDER THE SURFACE HERE.

MORNING, JOE. JOE: WE ARE SEEING WEEK NEXT -- WEEK THIS ACROSS THE MAG SEVEN. ALL OF THIS SEEMS TO BE STEMMING FROM THAT DOWNGRADE, HITTING THE TECH STOCKS, PUSHING UP BOND YIELDS THIS MORNING.

WE'VE ALSO GOT VACCINES IN OUR SITE. NOVAVAX, ASIA RALLYING ON A SPIKE UP IN COVID CASES AND WE'VE ALSO SEEN NEWS OF POTENTIALLY NOVAVAX, ONE OF THE BEST AROUND 50%. NETFLIX DOWNGRADED OVER A JP MORGAN AFTER 2.

5 YEARS AS AN OVERWEIGHT. WE'VE GOT SQUID GAME SEASON THREE COMING OUT IN THE SECOND HALF OF THE YEAR. NOT SURE IF WE NEED ANOTHER SERIES OF THAT BUT NONETHELESS, JP MORGAN RECKONS THAT THE VALUATION IS IN THE BEEN TOO HIGH FOR THAT ONE.

NETFLIX LOWER, 2% IN THE PREMARKET THIS MORNING. DANI: I FEEL LIKE WE JUST GOT SEASON TO, WE'RE ALREADY GETTING SEASON THREE? >> WHERE ELSE CAN WE GO WITH THIS?

DANI: IF IT WORKS, IT WORKS. A LOT ON THE MOVE THIS MORNING. ALSO IN MOMENTS, WE ARE GOING TO SPEAK WITH ALPHONSO.

LATER IN THE HOUR WE WILL KEEP UP WITH KEITH LERNER OF TRUEST. MOODY'S RATINGS STRIP IN THE U. S.

OF ITS TOP CREDIT AGENCY, TREASURY SECRETARY SCOTT BESSENT RESPONDING YESTERDAY. >> WE DIDN'T GET HERE IN THE PAST 100 DAYS. IT'S THE BIDEN ADMINISTRATION AND THE SPENDING WE'VE SEEN OVER THE PAST FOUR YEARS THAT WE INHERITED 6.

7% TO GDP, THE HIGHEST WHEN WE WEREN'T IN A RECESSION, NOT IN THE WAR AND WE ARE DETERMINED TO BRING THE SPENDING DOWN ANY GROW THE ECONOMY. DANI: ALSO DISCUSSING THE DOWNGRADE WRITING "PEOPLE WILL TRY NOW TO COMPARE THE SHORT-TERM MARKET REACTION TO 2011, THE LAST TIME THERE WAS A SURPRISING AND SIGNIFICANT RATING DOWNGRADE. YET THE COMPARISON MAKES NO SENSE.

IS THE FOUNDER AND CIO. THAT IS EXACTLY WHAT WE SEE THIS MORNING. PEOPLE HAVE BEEN MAKING THAT COMPARISON.

WHY IS IT NOT HAVE TO THIS TIME? >> FISH FIRST THING TO CONSIDER IS THE BROAD ECONOMIC SITUATION. 2011 YOU WERE JUST COMING OUT OF THE GREAT FINANCIAL CRISIS, A RELATIVELY WEAK ECONOMY.

PEOPLE WILL LOOK AT 30 YEAR BOND YIELDS AND SAY OK, NOW WE'VE GOT A SELLOFF BECAUSE HAS BEEN A U. S. DOWNGRADE AND BASICALLY THEY WANT TO MAKE A ONE-TO-ONE COMPARISON.

I WOULD ENCOURAGE PEOPLE TO THINK ABOUT THE LONG AND PROBLEM. OF COURSE THERE IS A TERM PREMIUM, THE UNCERTAINTY THAT PEOPLE WANT TO BE COMPENSATED FOR AND THAT MAKES A LOT OF SENSE BECAUSE THERE'S UNCERTAINTY IN THE POLICIES THAT THE TRUMP ADMINISTRATION IS PUTTING THROUGH. BUT THERE'S ALSO THE GROWTH CYCLE AND INFLATION CYCLE WE ARE IN TODAY.

AND OF COURSE WHEN YOU LOOK AT THE REASONS WHY MOODY HAS DOWNGRADED IN THE U. S. , DEFICITS WILL GO TO 9% OF GDP.

THAT'S A VERY LARGE NUMBER. I WOULD JUST ENCOURAGE PEOPLE TO UNDERSTAND THAT BOND YIELDS ARE NOT ONLY DRIVEN BY TODAY'S GROWTH AND TODAY'S INFLATION PROSPECT, SO THERE'S A LOT TO CONSIDER. DANI: YOU ALSO WRITE IT STILL REQUIRES A DIFFERENT APPROACH TO THE BOND MARKET THAN WE HAD DURING 2012-2019, SO WHAT IS DIFFERENT?

>> WHAT IS DIFFERENT REALLY IS THE FACT THAT YOU ARE LOOKING AT AN ADMINISTRATION THAT IS WILLING TO BRING THE PRIVATE SECTOR BECAUSE THAT IS WHAT FISCAL DEFICITS ARE. WHEN YOU DO THAT ON A SUSTAINED BASIS, YOU ARE LOOKING AT 3% OR MORE OF PRIMARY DEFICITS. WHERE ESSENTIALLY GETTING MORE FUEL FOR THE PRIVATE SECTOR.

SO WHAT YOU'RE ARE DOING IS EFFECTIVELY YOU ARE RAISING THE NOMINAL NEED FOR RATE FOR THE UNITED STATES BECAUSE AN ECONOMY WHICH IS TO HAVE A NOMINAL NEUTRAL RATE WITHOUT FISCAL DEFICITS NOW PROBLEM HAS TO GO A BIT HIGHER. PRIVATE SECTOR IN THE U. S.

IS DELEVERAGE COMPARED TO 7, 8 YEARS AGO. WHICH MEANS THE PRIVATE SECTOR IS MORE RESILIENT. IT CAN AFFORD A BIT OF A HIGHER NEUTRAL RATE AND YOU HAVE AN ADMINISTRATION KEEPS PUTTING ON PRIMARY DEFICITS OVER PRIMARY DEFICITS.

EFFECTIVELY YOU NEED TO EXPECT MORE VOLATILITY AROUND THE LEVEL OF INTEREST RATES GOING FORWARD WHICH IS A HIGHER NOMINAL NEUTRAL AND HIGHER TERM PREMIUM ON TOP OF THAT. THAT'S VERY DIFFERENT THAN 2012-2019. DANI: I GUESS I'M JUST TRYING TO UNDERSTAND THE LINE OF WHAT YOU ARE LOOKING AT AND SAYING THIS IS STIMULUS VERSUS SAYING THIS IS IRRESPONSIBILITY, A TIME WE SEE FOREIGNERS START TO PULL BACK FROM THE TREASURY MARKET.

WHAT IS THE LINE BETWEEN WHAT IS STIMULUS AND WHAT HAS GONE TOO FAR WITH LEARNING DEFICITS? >> I THINK THE MARKET IS ALREADY TRYING TO TELL IT THAT THEY'RE NOT GOING TO TRY TO TREAT THIS DEFICIT AS THEY DID SEVEN OR EIGHT YEARS AGO. WHEN YOU START TO HAVE AN EMERGING MARKET, THAT IS WHEN YOU REALLY NEED TO START WORRYING.

AND AN EMERGING MARKET IS BASICALLY IN THE U. S. ANNOUNCES A DEFICIT THAT WHAT IT DOES IS IT TIGHTENS FINANCIAL CONDITIONS WHICH MEANS EFFECTIVELY, YOU HAVE YOUR CURRENCY THAT DEVALUATES, YOU HAVE A SELLOFF IN ASSETS OF THAT COUNTRY SAY YOU HAVE BOND YIELDS UP, EQUITIES DOWN AND THE CURRENCY DOWN.

IT HAS NEVER HAPPENED IN THE UNITED STATES OVER THE LAST 45 YEARS. BUT EVEN IF YOU ARE THE GLOBAL RESERVE CURRENCY OF THE WORLD, WITH THE U. S.

STILL IS, WHY INFLATION REMAINS STICKY, IF INFLATION REMAINS STICKY AND THE ADMINISTRATION CONTINUES WITH PRIMARY DEFICITS, WE MIGHT HAVE AN EMERGING MARKET LIKE PRICE ACTION BOND MARKETS. I THINK INVESTORS HAVE TO CONSIDER THE PROBABILITY THIS TIME. DANI: I KNOW ONE DAY DOES NOT A TREND MAKE BUT IT IS HIGHER BOND YIELDS, STOCKS ARE SELLING OFF IN THE DOLLAR IS WEAKER.

WHEN YOU LOOK AT A 30 YEAR YIELD, AGAIN, BESIDES 2023, THE LAST TIME WE SIDE HIGHER THAN THIS WAS 2007. HOW DO YOU DECIDE WE MIGHT BE HEADING INTO AN ENVIRONMENT THAT LOOKS LIKE EM VS. THIS IS A GENERATIONAL BUYING OPPORTUNITY?

>> WE RUN A STUDY WHERE WE LOOK AT OTHER EPISODES IN THE PAST FOR YOU HAD THIS TRIFECTA THAT LOOKS LIKE AN EMERGING MARKET. YOU HAD 11 OF THESE EPISODES WHICH LAST ABOUT A MONTH OR SO IN ALL THREE ASSET CLASSES WE DISCUSSED SIMULTANEOUSLY. THE PROBLEM IS THAT THERE WAS NEVER A SUSTAINED FOLLOW-UP.

SO YOU HAD THIS MOVE AND ENDED UP BEING A GREAT BUYING OPPORTUNITY. SO WHAT YOU NEED TO SEE IS WHETHER THIS REMAINS SUSTAINED. AND REALLY WHAT YOU'RE SAYING IS IF YOU ARE SELLING 30 YEAR BONDS AND FED FUNDS ARE AT 4.

25, WHAT YOU ARE REALLY DOING IS YOU ARE PAYING NEGATIVE TARIFFS. SO UNLESS YOU THINK THE FED IS GOING TO HIKE RATES, WHICH IS A LITTLE BIT HARD A SCENARIO TO IMAGINE, YOU'RE EFFECTIVELY WILLING TO PAY AWAY TARIFFS FOR NOT OWNING THAT BOND. YOU NEED TO ASK YOURSELF IS THIS JUSTIFIED?

FOR HOW LONG CAN IT GO, WILL WE CONTINUE TO HAVE THESE POLICIES? THE ANSWER IS ALWAYS, THE PROBABILITY AT THIS POINT IN TIME GIVEN THE NHTSA POLICIES HAS NEVER BEEN HIGHER OVER THE LAST 40 YEARS, THAT YOU COULD HAVE A SUSTAINED PRICE ACTION. YOU NEED TO BE PREPARED FOR IT.

ALL THE CORRELATIONS THAT WE ARE USED TO BASICALLY ARE THE STOCK MARKET DECLINE. NO, THEY'RE NOT GOING TO HAVE THAT. YOU'RE GOING TO HAVE THE DOLLAR STRENGTH, NO, YOU ARE NOT GOING TO HAVE THAT.

DANI: THAT KIND OF PREPARATION WOULD REALLY PAY OFF ON A DAY LIKE TODAY. THANK YOU SO MUCH FOR JOINING US. THAT'S NOW GET SOME OTHER TOP STORIES THAT ARE TRENDING ON THE TERMINAL THIS MORNING.

NVIDIA UNVEILED FASTER CHIP SYSTEMS, NEW SOFTWARE AND OTHER NEW TECH AT AGES GET ELECTRONICS FORM EARLIER TODAY. THE CEO INTRODUCED THE UPDATES AND ALSO ANNOUNCED A COLLABORATION FOR TAIWAN. >> WE ARE ALSO BUILDING AI FOR TAIWAN.

AND SO TODAY WE ARE ANNOUNCING THAT FOXCONN TAIWAN, THE TAIWANESE GOVERNMENT, NVIDIA, TSMC, WE ARE GOING TO BUILD THE FIRST GIANT AI SUPERCOMPUTER. DANI: SHARES IN ALIBABA ARE SLIDING DOWN 2% THIS MORNING AFTER A REPORT THAT THE TRUMP ADMINISTRATION HAS RAISED CONCERNS OVER POTENTIAL DEALS BETWEEN ALIBABA AND APPLE. THE MEAGER TIME IS REPORTING THAT THE WHITE HOUSE AND CONGRESSIONAL OFFICIALS HAVE BEEN SCRUTINIZING A PLAN TO MAKE ALIBABA'S AI AVAILABLE ON IPHONES.

THE LATEST CHINESE DATA SHOWS CONSUMPTION UNDERSHOOTING EXPECTATIONS AS RETAIL SALES GROWTH WE CAN LAST MONTH. INDUSTRIAL OUTPUT EXPANDED FASTER THAN EXPECTED AND CONGRESS WARNED THAT THE DATA HIGHLIGHT THE NEED FOR MORE SUPPORTIVE POLICIES. COMING UP, TRUMP'S TAX BILL PASSES THE HOUSE COMMITTEE AND ADVANCES TO THE SENATE.

WE'RE GOING TO HAVE MORE ON THAT COMING UP NEXT. ♪ >> WE ARE MOVING THE DIALS AS WE SAID EARLIER. THERE'S NOTHING TO ADJUST.

I'M NOT GOING TO TELL YOU WHAT I'VE OFFERED. WE ARE NEGOTIATING WITH A NUMBER OF MEMBERS. >> DO YOU THINK NEGOTIATIONS ARE CLOSE ENOUGH?

>> I DO. I'M AN OPTIMIST MOVING FORWARD. DANI: LIKE JOHNSON'S OPTIMISM MATERIALIZING OF THE WEEK WITH PARTY LEADERS NET FOR NEGOTIATIONS.

THE TAX BILL HAS BEEN APPROVED BY THE HOUSE BUDGET COMMITTEE BUT STILL FACES OBSTACLES. JOINING US NOW IS JOSH GALLO. JOSH, AT ONE POINT ON FRIDAY THIS DIDN'T LOOK LIKE IT WOULD PASS, AT LEAST THE INITIAL VOTE.

DOES THIS LOOK LIKELY TO GO THROUGH THE HOUSE? >> I THINK THERE ARE A LOT OF DETAILS THAT STILL NEED TO BE WORKED OUT TO KNOW EXACTLY WHERE IT STANDS. SPEAKER JOHNSON OBVIOUSLY AS YOU JUST SHOWED, HE'S NONCOMMITTAL IN TERMS OF WHAT SORTS OF THINGS HE'S PROMISED TO REPUBLICANS TO GET IT OUT OF THE COMMITTEE.

OF COURSE THEY REJECTED IT ON FRIDAY AND THEN CAME BACK LATE ON SUNDAY, AND ESSENTIALLY ABSTAINED IN ORDER TO MOVE IT THROUGH. SO YOU HAVE THESE HARDLINERS THAT ARE CONCERNED ABOUT THE BUDGET DEFICIT. THEY ARE CALLING FOR EARLIER REQUIREMENTS FOR WORK IN ORDER TO RECEIVE MEDICAID THAT IS SET TO KICK IN IN THE DRAFT, NOT UNTIL 2029, NOTABLY AFTER THE NEXT PRESIDENTIAL ELECTION.

THEY WANT TO MOVE THAT FORWARD. THAT IS SORT OF A CORE ISSUE FOR REPUBLICANS AND IT HAS BEEN FOR SOME TIME. THIS BILL ADDS $3.

8 TRILLION IN SPENDING, AND THE CUTS THAT THEY'VE ALREADY PROPOSED ARE NOT GOING TO COVER THAT. HARDLINERS ON THE BUDGET SIDE, THEY ARE NOT YET QUITE HAPPY WITH WHERE THIS IS, EVEN THOUGH THEY SAY THEY'VE BEEN PROMISED SOME EARLIER CUTS TO MEDICAID, EDUCATION, CLEAN ENERGY, SUBSIDIES THAT WOULD GO SOME DISTANCE IN MAKING IT MORE AFFORDABLE. BUT ON THE OTHER HAND, YOU HAVE PEOPLE, REPUBLICANS IN STATES LIKE NEW JERSEY, NEW YORK, CALIFORNIA WHO ARE PUSHING FOR BASICALLY MORE TAX BREAKS.

THEY SAY THAT THE STATE AND LOCAL TAX DEDUCTION IS NOT GOING TO BE BIG ENOUGH FOR THEM TO SUPPORT IT. SO I THINK SPEAKER JOHNSON STILL HAS A WAY TO GO TO GET EVERYBODY ON BOARD THAT HE NEEDS TO, IN ORDER TO GET A THIRD BY MEMORIAL DAY WHICH IS WHAT HE SAYS HE WANTS TO DO. DANI: THEN WE ALSO FACE THE SENATE.

WHAT DOES THE BATTLE LOOK LIKE THERE? >> SIMILARLY THERE ARE A LOT OF PEOPLE WHO ARE HOLDING OUT. AGAIN YOU WERE GOING TO FAITH THE STATE AND LOCAL TAX SEDUCTION BARRIER OF THIS STATE THAT I MENTIONED.

BUT YOU ALSO HAVE PEOPLE LIKE SENATOR JOSH HAWLEY FROM MISSOURI WHO IS PUSHING FOR NOT HAVING THESE STEEP CUTS TO MEDICAID. THEY MIGHT BE ABLE TO BRIDGE THAT BY MAKING IT LESS OF A CUT AND MORE OF A WORK REQUIREMENT FOR PEOPLE ON MEDICAID, THAT THERE IS STILL A STEEP HURDLE. WE WILL HAVE TO SEE.

HOUSE BILL THAT COMES OUT IS GOING TO FACE A LOT OF CHANGES BY THE SENATE, AND IT'S NOT CLEAR THAT EVERYBODY COULD GET ON BOARD WITH THIS THAT THEY NEED TO PUSH IT THROUGH. AGAIN, THEY HAVE THIS AMBITIOUS TIMELINE OF GETTING IT TO TRUMP'S DESK BY JULY 4, AND IT'S GOING TO BE PRETTY TENSE NEGOTIATIONS ALL THE WAY THROUGH. DANI: A MARKET THAT IS INCREASINGLY TURNING ITS ATTENTION TO BUDGET DEFICITS THE DOWNGRADE.

THANK YOU SO MUCH. JUST WANT TO POINT OUT, PUTTING OUT A NOTE JUST NOW TALKING ABOUT THE MARKET NERVOUSNESS AFTER THE DOWNGRADE, BUT POINTING TO THE FACT THAT WHAT IS DECIDED IN THE NEXT COUPLE OF WEEKS WILL LIKELY BE LOCKED IN FOR THE REMAINDER OF THE DECADE GIVEN A VERY DIFFICULT RECONCILIATION PROCESS, THE POTENTIAL LOSS OF REPUBLICAN MAJORITY IN THE MIDTERMS. THAT LEAVES ONLY SPACE, HE SAYS, FOR MAJOR PHYSICAL EVENT SAYING THAT THE DIMINISHED APPETITE TO BUY U.

S. ASSETS AND THE RIGIDITY OF THE U. S.

FISCAL PROCESS THAT LOCKS IN VERY HIGH DEFICITS IS WHAT IS MAKING THE MARKET VERY NERVOUS. AND NERVOUS WE ARE, TODAY. COMING UP, WE ARE GOING TO TAKE A LOOK AT THE WORLD.

WHAT IS ON YOUR FRONT PAGES INCLUDING A RELATIONSHIP BETWEEN THE U. K. AND THE E.

U. HEAD OF A SUMMIT TODAY. YOU ARE WATCHING "BLOOMBERG BRIEF.

" ♪ DANI: LET'S TAKE A LOOK AT THE FRONT PAGES THIS MORNING. THE WASHINGTON POST AND MOST NEWSPAPERS IN THE COUNTRY LEADING THE FORMER PRESIDENT JOE BIDEN AND HIS DIAGNOSIS OF AN AGGRESSIVE FORM OF PROSTATE CANCER. HIS OFFICE AT THE CONDITION HAS SPREAD TO HIS BONES BUT THAT THE DISEASE APPEARS TO BE MANAGEABLE.

PRESIDENT TRUMP ALSO POSTED A SUPPORT MESSAGE ON TRUTH SOCIAL ALONG WITH OTHER POLITICIANS. NEXT UP THE NEW YORK TIMES ALSO COVERING THE DEAL STRUCK BETWEEN NEW JERSEY TRANSIT AND ITS ENGINEERS UNION. THE AGENCY SAID TRAINS WOULD START RUNNING AGAIN TUESDAY MORNING.

EVEN SO IT PRESUMES TUESDAY MORNING AFTER SPENDING SAFETY CHECKS TODAY. AND ONE OF THE MOST READ ON THE BLOOMBERG TERMINAL THIS MORNING THAT THE E. U.

, THE U. K. AGREEING TO TERMS OF A POST-BREXIT RESET FOR BRITAIN.

THAT COMES AHEAD OF A SUMMIT BY BOTH SIDES TODAY. THE AGREEMENT COVERS DEFENSE AND SECURITY AND GEOPOLITICAL CHALLENGES AND THE COMMON UNDERSTANDING ON A RANGE OF OTHER ISSUES. FOR MORE WE ARE JOINED BY BLOOMBERG'S CHIEF EUROPEAN CORRESPONDENT.

WE ARE IN THIS MOMENT OF MORE OPTIMISM AROUND EUROPE. IS THIS ANOTHER REASON TO BE OPTIMISTIC ABOUT THE E. U.

AND THE U. K. ?

>> I THINK NEGOTIATORS WOULD CERTAINLY WANT TO SPIN IT THAT WAY AND IN SOME WAYS IT IS CERTAINLY PROGRESS. BUT THEY WANT TO DO IS EXPAND SOME OF ECONOMIC RELATIONSHIP BETWEEN THE E. U.

, THE U. K. IN THE ABSENCE OF THE UNITED STATES AND ITS UNPREDICTABLE STATUS IN THE WORLD RIGHT NOW.

THIS IS MEANT TO BE THE FIRST STEP TO THIS. WE ARE GOING TO HOPEFULLY GET IT RATIFIED LATER TODAY. I WILL GO THROUGH A LITTLE BIT OF WHAT IT ENTAILS.

IT IS AN AGREEMENT THAT BASICALLY INCLUDE THREE DIFFERENT TEXTS, ANOTHER ONE WORKING TOGETHER AND GEOPOLITICAL CHALLENGE AND ANOTHER VERY AND GIVE ASLEEP, A COMMON UNDERSTANDING ON A RANGE OF OTHER ISSUES. ON THE DEFENSE SIDE OF THINGS, WHAT COULD INTERESTING IS THE U. K.

WORKING MORE CLOSE TO WHAT THE EUROPEANS POTENTIALLY ON POINT PROCUREMENT OF MILITARY EQUIPMENT. THEY WILL NOT BE ELIGIBLE FOR A LOT OF THE EUROPEAN PROGRAMS THAT BRUSSELS HAS PUT UP BUT THESE NEGOTIATIONS HAD TO DO AROUND PHISING. IT IS STILL A LIVE ONE BETWEEN THE EUROPEANS AND THE UNITED KINGDOM.

ALSO FREEDOM OF MOVEMENT OF PEOPLE, STUDENTS, BUT I THINK THAT FUNDAMENTALLY THE ISSUE THAT YOU HAVE AND YOU ALWAYS RETURN TO, THIS IS KEIR STARMER'S ATTEMPT TO SOFTEN BREXIT A LITTLE BIT, TO DELIVER SOME OF THE ECONOMIC PROMISE BETWEEN THE E. U. , THE U.

K. WITHOUT SORT OF REDLINES THAT WILL UPSET THE DOMESTIC POPULATION OF THE U. K.

AND FUNDAMENTALLY, THE DIFFICULTY WITH BREXIT SINCE THE VERY BEGINNING IS IT IS VERY DIFFICULT TO SQUARE THAT CIRCLE. A STEP IN THE RIGHT DIRECTION. HOW IMPACTFUL IT WILL BECOME WILL HAVE TO SEE.

DANI: I THINK THAT IS WHAT EVERYONE IS GOING TO FOCUS ON. ON A MORE SERIOUS NOTE, WE ARE EXPECTING A PHONE CALL ELSEWHERE IN EUROPE BETWEEN VLADIMIR PUTIN AND PRESIDENT TRUMP ON MONDAY. WHATEVER YOU EXPECTING?

>> FULLY GOT FROM DONALD TRUMP OVER THE WEEKEND WAS THE ANNOUNCEMENT THAT HE WILL BE SPEAKING WITH VLADIMIR PUTIN AT 10:00 A. M. EASTERN TIME, 4:00 P.

M. CENTRAL EUROPEAN TIME IN ORDER TO MAKE A SORT OF BREAKTHROUGH IN THE DISCUSSIONS BETWEEN UKRAINE AND RUSSIA IN TERMS OF THE POSSIBLE CEASE-FIRE. REMEMBER THIS IS SOMETHING THE ADMINISTRATION IS PUTTING -- HAS BEEN PUTTING INCREASING PRESSURE ON.

THAT 30 DAY CEASE-FIRE WHICH PUTIN REJECTED LAST WEEK. THESE TALKS IN TURKEY LEAD NOWHERE AND THE IDEA NOW WITH THE DONALD TRUMP A TRY TO BREAK THROUGH THAT DEADLOCK AND ADVANCE THE CONVERSATION AROUND THE CEASE-FIRE. WE HAD A FLURRY OF DIPLOMATIC ACTIVITY OF THE LAST 48 HOURS, JD VANCE MEETING WITH ZELENSKYY FOR THE FIRST TIME SINCE THAT OVAL OFFICE BLOWOUT IN ROME AND ITALY OVER THE WEEKEND.

WE HAD A CALL BETWEEN KEIR STARMER, GIORGIA MELONI SPEAKING WITHOUT TRUMP YESTERDAY TRYING TO GET HIS EAR. ALL THE LEADERS I SPOKE TO LAST WEEK IN ALBANIA WERE SAYING THAT BASICALLY PUTIN IS JUST PLAYING GAMES, TRYING TO BUY TIME AS HE PREPARED FOR THIS CONVERSATION WITH TRUMP. THE QUESTION IS WILL HE BE ABLE TO BREAK THROUGH AND FOR THE TRUMP ADMINISTRATION NO MATTER WHAT HAPPENS, THIS WILL TAKE THEM CLOSER TO HAVING TO DECIDE WHO THE PROBLEM IS.

IS IT ZELENSKYY, PUTIN, OR IS IT TOO COMPLEX TO SOLVE? DANI: THANK YOU FOR YOUR EXCELLENT COVERAGE AS ALWAYS. COMING UP, WE CHAT WITH KEITH LERNER OF TRUEST ON HOW TO NAVIGATE WHAT HE CALLS TRICKY SITUATION IN MARKETS AS EQUITIES, BONDS AND THE DOLLAR SELLOFF THIS MORNING.

♪ DANI: WELCOME TO "BLOOMBERG BRIEF" I'M DANI BURGER, LET'S SET THE AGENDA. A READING SCOTT, STOCKS, FUTURES, AND TREASURIES DIP AS 30 YEAR YIELD REACHED 5%. MOVING ALONG THE HOUSE BUDGET COMMITTEE ADVANCES PRESIDENT TRUMP'S TAX BILL AND COULD SPEED UP CUTS TO MEDICAID COVERAGE.

AND NVIDIA UNVEILS NEW TECHNOLOGY TO KEEP UP WITH THE BOOM IN AI DEMAND. GOOD MORNING TO YOU, IT IS A TOUGH DAY FOR U. S.

ASSETS. STOCKS, BONDS, THE DOLLAR ALL UNDER PRESSURE FOR YOUR S&P. NASDAQ 100 AND RUSSELL 2000 UNDER PERFORMED, DOWN MORE THAN 1.

5%. IT IS A MARKET'S NARRATIVE HAS QUICKLY FLIPPED FROM TARIFF AND NEGOTIATIONS RENT TARIFFS TO THE BUDGET ISN'T SUSTAINABLE. YOU CAN CONTINUE TO SEE YIELDS UNDER PRESSURE.

THE FRONT END STILL PINNED BY THE FED, THE 30 YEAR YIELD GOES UP ANOTHER 7. 5 BASIS POINTS. WE ARE AT 5% FOR THE FIRST TIME SINCE NOVEMBER 2023 WHILE THE DOLLAR FALLS AGAINST MOST OF ITS PEERS.

BACK WITH SOME STOCKS TO WATCH, HERE IS JOE EASTON. JOE: WE ARE SEEING WEAKNESS ACROSS THE MAG SEVEN, TAKE A LOOK AT TESLA, DOWN AROUND 4% IN THE PREMARKET, PRETTY MUCH DRIVEN BY THOSE MACRO ISSUES FOR THE U. S.

DEBT RATING. THEREFORE THAT MOVE UP AND TREASURIES HITTING THE TECH STOCKS TODAY. APPLE AS WELL.

MUCH ACROSS THE BOARD IN THAT SPACE. AND WE'VE GOT NOVAVAX ON THE RADAR, THE RALLY IN THIS ONE PREMARKET. OVERNIGHT WE'VE SEEN A SPIKE OVER IN SINGAPORE AND HONG KONG.

NOVAVAX ALSO GETTING A BIT OF A BOOST FROM FDA APPROVAL FOR ONE OF THEIR COVID SHOTS. THEN NETFLIX, JP MORGAN DOWNGRADING THE COMPANY, GOING DOWN TO NEUTRAL AFTER TWO YEARS RECOMMENDING BUYING A STOCK. SQUID GAME THREE COMING OUT, NOT SURE WHERE THEY ARE GOING TO GO WITH THAT ONE THE GIVEN WE'VE ALREADY HAD TWO SERIES OF THAT.

THAT STOPPED DECLINING TO PERCENT IN THE PREMARKET TODAY. DANI: THEY'VE DONE ALREADY EVERY THING THEY CAN DO. MAYBE A WHOLE NEW CAST?

I DON'T KNOW. >> THEY HAVE A VIDEOGAME AS WELL. DANI: SQUEEZE THAT BAD BOY FOR ALL THAT IS WORTH.

JOE EASTON. WE ARE MORE THAN 90% INTO THIS EARNINGS SEASON. CORPORATE AMERICA HAS SHOWN CAUTION AROUND GUIDANCE FOR THE COMING VOTERS, WALMART INCLUDED.

TAKE A LISTEN TO WHAT SCOTT BESSENT HAD TO SAY ABOUT ONE OF THE LARGEST COMPANIES IN THE COUNTRY. >> WALMART IS IN FACT GOING TO COME AS YOU DESCRIBE IT, EAT SOME OF THE TARIFFS. JUST AS THEY DID IN 18, 19, AND 20.

THE OTHER THING THOUGH THAT WE ARE SEEING THAT GOT PASSED ALONG TO ME, WITH THEIR CONSUMERS, THE SINGULAR MOST IMPORTANT THING THAT THE GASOLINE PRICE. GASOLINE PRICES HAVE COLLAPSED UNDER PRESIDENT TRUMP. DANI: KEITH LERNER SHOWING CONFIDENCE IN CORPORATE AMERICA WRITING U.

S. COMPANIES HAVE BEEN BATTLE TESTED TO THE LAST SEVERAL YEARS IN THE HIGHEST INFLATION RATE IN DECADES. THEY CONTINUE TO HAVE REFORM EXPECTATIONS.

REALLY WONDERFUL TO SEE YOU THIS MORNING. IT IS THIS PUSH AND PULL BETWEEN THE ADMINISTRATION THAT IS TELLING COMPANIES THEY SHOULD BE RAISING PRICES TO WALMART SAYING IT IS INEVITABLE. HOW ARE YOU SEEING THE POLITICAL AND MARGIN RISKS EVOLVING AFTER WE HEARD FROM THEM AND THEIR EARNINGS FOR MOST OF CORPORATE AMERICA?

>> SO LISTEN, I DO THINK SO FAR THIS HAS BEEN WEATHERED PRETTY WELL. EVEN THOUGH IT WASN'T A BLOWOUT EARNINGS SEASON BUT WAS TO EXPECTATIONS, IT WAS SOMEWHAT BETTER. THAT SAID, WE DO THINK WE ARE IN A TRICKY SITUATION HERE.

BACK IN FEBRUARY WE THOUGHT THERE WAS A LOT OF COMPLACENCY. YOU HAD A LOT OF RECESSION BUILT INTO MARKETS. NOW YOU'RE OF 23% FOR THIS MARKET.

THAT EVEN BEFORE WE SAW THIS MOVE IN ON THE 10 YEAR AND THE 30 YEAR AND TO YOUR QUESTION AROUND THE MARGINS, WITH ALL OF THE NOTICE FORWARD EARNING ESTIMATES FLATLINING OVER THE LAST TWO MONTHS. PROFIT MARGINS MAY BE AT RISK AT SOME POINT. YOUR BACK TO A 21.

5 MULTIPLE SO YOU ARE CLOSE TO PEAK MULTIPLES AS WELL. EVEN THOUGH CORPORATE AMERICA HAS DONE WELL, NOW YOU HAVE GOOD NEWS BEING PRICED INTO MARKETS AND YOU ARE VULNERABLE TO SOMETHING UNEXPECTED LIKE WE SAW FRIDAY. DANI: SO WHAT WOULD IT TAKE YOU TO GET BACK TO SOMETHING THAT LOOKS MORE CONSTRUCTIVE ON RISK ASSETS?

>> AS I MENTIONED, IT WAS NOT LIKE GREEN LIGHT, RED LIGHT. ONE, MAY BE LOWER PRICES. TWO, MAYBE JUST A CONSOLIDATION OF THESE RECENT GAINS.

WHAT IS INTERESTING IS IF WE LOOK BACK TO THE DAY AFTER THE ELECTION, WE ARE ONLY UP 0. 4% SINCE THE DAY AFTER THE ELECTION, SO WE SEEN THIS HUGE VOLATILITY BUT I ALSO THINK WE JUST REALLY NEED TO KIND OF MOVE PAST THIS UNCERTAINTY IN THAN THE MARKETS CAN FOCUS ON THOSE ANIMAL SPIRITS AGAIN, THE TAX BILL, THE DEREGULATION. MAYBE JUST SOME CONSOLIDATION, SOME DIGESTION.

THAT MIGHT BE ENOUGH BUT AT THIS POINT WE ARE IN A HOLDING PATTERN MUCH LIKE THE FED IS TODAY AS WELL. DANI: THERE IS A LITTLE BIT OF IRONY BECAUSE THE MARKET DOES SEEM, AT LEAST FOR THE VERY SHORT TERM, TO HAVE MOVED ON FROM TRADE POLICY, BUT IT'S MOVED ON TO SOMETHING THAT ISN'T EXACTLY GREAT, AND THAT IS BALLOONING DEFICIT. THE TAX BILL MAKING ITS WAY THROUGH THE HOUSE AFTER THE DOWNGRADE WHERE YOU SEE STOCKS, BONDS AND THE DOLLAR ALL SELLING OFF SIMULTANEOUSLY.

DO YOU THINK THAT CAN LAST AS A DRIVER OF THIS MARKET? >> WEN YU REBOUND THAT YOU HAVE 23% AND YOU ARE BACK TO ALMOST MULTIPLES, AND A LOT OF BAD NEWS CAN GO A LONG WAY. RIGHT NOW, THAT 10 YEAR AND THAT 30 YEAR WHICH I HEARD YOU DISCUSSING EARLIER IS A CONCERN BECAUSE IF YOU THINK ABOUT IT, IF YOU LOOK AT THE EARNINGS RISK PREMIUM FOR THE MARKET, THE INVERSE RIGHT NOW OF THE EARNINGS YIELD IS AROUND 4.

5%. THAT IS CLOSE TO WHERE THE 10-YEAR IS. I DO THINK THAT 10 YEAR TREASURY IS KEY IN THE MARKET TO RESUME THE UPTURN THAT WE'VE SEEN RECENTLY.

IT'S GOING TO WANT TO SEE SOME STABILIZATION. WE ALSO KNOW THAT SCOTT BESSENT HAS HIGHLIGHTED THE IMPORTANCE OF THE 10 YEAR, SO I'M SURE STOCKS CAN THEY BE DRAWN THAT A BIT MORE BUT THAT WILL BE KEY FOR THIS WEEK. DANI: I KNOW YOU ARE QUITE OPTIMISTIC ON TECH ESPECIALLY AFTER ALL THE AI SPENDING THAT IS HAPPENING.

AT WHAT POINT ARE TECH STOCKS, ONE ITERATION STOCKS CAN'T KEEP ABSORBING THESE HIGHER LEVELS OF YIELDS. >> TECH HAS ALSO JUST HAD A REALLY THE RUN. EVEN THOUGH THEY CAN REALLY STAND OUT IN BEING BRAZILIAN, THE HEALTHY SPENDING IN A I WAS REALLY SOMETHING THAT STOOD OUT TO US.

THAT SAID, I THINK THE RELATIONSHIP BETWEEN INTEREST RATES AND TECH IS SOMEWHAT OVER EXTRAPOLATED. A SOMEWHAT BIGGER DRIVER IF THE RELATIVE EARNINGS MOMENTUM. IT TENDS TO OUTPERFORM.

THE EARNINGS MOMENTUM IS STILL THERE. I SUSPECT YOU HAVE A BIG MOVE UP IN TECH. I THINK IF IT GOES BACK A BIT YOU WILL HAVE SOME BIAS ON A SHORT-TERM BASIS.

IT IS SOMEONE VULNERABLE TO THESE HIGHER RATES BUT ULTIMATELY I THINK EARNINGS ARE GOING TO BE THE BIGGER DRIVER FOR THE OUTPERFORMANCE AND WE ARE OVERWEIGHT COMMUNICATIONS. WE ARE ALSO OVERWEIGHT UTILITIES AND FINANCIALS, KIND OF A MIXED AT THIS POINT. DANI: I WANT TO GO BACK TO THE IDEA THAT YOU MENTIONED THAT THIS IS IN THE NUTRITION THAT CARES ABOUT THE BOND MARKET.

IT'S NOT YET CLEAR THAT IT IS A CONGRESS THAT DOES. IT IS ANY FISCAL TO -- FISCAL DISCIPLINE, THERE WAS ONE BOND MARKET VETERAN WHO ESSENTIALLY SAID THAT WE NEED SOMETHING THAT LOOKS LIKE A LIZ TRUSS MOMENT IN ORDER TO INJECT ANY SORT OF FISCAL DISCIPLINE INTO THE MARKET OR INTO THE CONVERSATION AND OTHERWISE IT'S NOT GOING TO HAPPEN. DO YOU THINK THAT IS THE CASE, THAT YOU NEED A LARGE BOND RUPTURE TO ACTUALLY MOVE CONGRESS TO BACK OFF SOME OF THE DEFICIT BALLOONING THAT THEY EXPECT TO DO?

>> IT'S A GOOD QUESTION. THE ONE THING ON THE PARTISAN SIDE IS DEMOCRATS AND REPUBLICANS OVER THE LAST COUPLE OF YEARS CONTINUE TO MOVE THE DEFICITS UP. I THINK WINSTON CHURCHILL SO THAT AMERICANS WILL DO THE RIGHT THING AFTER THEY TRIED EVERYTHING ELSE.

MAYBE YOU NEED THAT, BUT I DO THINK IT'S A LITTLE BIT OF A WAKE-UP CALL. THE DOWNGRADE IN OUR VIEW IS A GAME CHANGER, AND THE 10 YEAR TREASURY AS MUCH AS I MENTIONED BEFORE, IT DOES HAVE A LIFE OF ITS OWN. I DO THINK IT'S GOING TO BECOME MORE IN FOCUS.

WHETHER WE NEED A LIZ TRUSS MOMENT IS DEBATABLE BUT I DO THINK THIS WILL GET THE ATTENTION OF CONGRESS AS WE SEE THESE YIELDS MOVE HIGHER WITH THIS RECENT DOWNGRADE. DANI: WE LOVE STARTING THE WEEK WITH YOU. THANK YOU SO MUCH FOR JOINING.

LET'S NOT GET YOU SOME OTHER TOP STORIES TRENDING ON THE TERMINAL THIS MORNING. ISRAELI PRIME MINISTER BENJAMIN NETANYAHU SAYS THEY ARE SET TO TAKE CONTROL OF THE ENTIRE GAZA STRIP. TANKS AND TROOPS ORDERED INTO GAZA.

NETANYAHU ALSO SAYS THAT ISRAEL WILL ALLOW A BASIC QUANTITY OF FOOD INTO THE TERRITORY AFTER ALLIES PRESSURED HIS GOVERNMENT TO AVERT FAMINE. IN A CHECK ON ALIBABA SHARES SLIDING THIS MORNING BY ABOUT 2%. THE MOVE FOLLOWS REPORTS THAT THE TRUMPET NUTRITION HAS RAISED CONCERNS.

THE NEW YORK TIMES REPORTING THAT THE WHITE HOUSE AND CONGRESSIONAL OFFICIALS HAVE BEEN SCRUTINIZING A PLAN TO MAKE ALIBABA'S AI AVAILABLE ON IPHONE. ELSEWHERE IN CHINA, CHINESE CONSUMPTION DATA UNDERSHOT EXPECTATIONS WITH RETAIL SALES GROWTH WEAKENING LAST MONTH ACCORDING TO THE LATEST NATIONAL STATISTICS. MEANWHILE CHINA'S INDUSTRIAL OUTPUT EXPANDED FASTER THAN EXPECTED.

BEIJING HAS BEEN MAKING BOOSTING DOMESTIC CONSUMPTION A PRIORITY. COMING UP, TRUMP'S TAX BILL ADVANCES, THE GOP MAKES A DEAL WITH HARDLINERS. THE DETAILS FOR YOU COMING UP NEXT.

THIS IS BLOOMBERG. THIS IS BLOOMBERG. ♪ >> WE HAVE A FEW PIECES YET TO SOLVE.

WE ARE MOVING THE DIALS AS I SAID EARLIER. I'M NOT GOING TO TELL YOU WHAT I'VE OFFERED. WE ARE NEGOTIATING WITH A NUMBER OF MEMBERS.

>> DO YOU THINK THE NEGOTIATIONS ARE CLOSE ENOUGH TO AXLEY GET SOMETHING DONE? >> I DO. DANI: THAT OPTIMISM FROM HOUSE SPEAKER MIKE JOHNSON ON FRIDAY WAS NOT MISPLACED BECAUSE THE HOUSE BUDGET COMMITTEE WENT ON TO PAST PRESIDENT TRUMP'S TAX BILL LATE LAST NIGHT, THE PACKAGE STILL HAS A LONG ROAD AHEAD.

JOSH, WHERE IS THE BILL HEADED FROM HERE? >> FROM HERE IT IS MOVING ON TO BE DEBATED ON THE HOUSE FLOOR AND AS YOU SAID, IT'S A LONG ROAD AHEAD. DON'T FORGET THAT IT IS A VICTORY FOR JOHNSON TO GET THAT OUT OF COMMITTEE, BUT IT WAS REJECTED ON FRIDAY WHEN IT CAME THROUGH BECAUSE OF THE FOUR HARDLINE REPUBLICANS WHO ARE REALLY TOUGH ON DEFICIT ISSUES.

THEY ABSTAINED. THEY DIDN'T VOTE FOR IT, THEY ABSTAINED. AND IT SHOWS THAT THERE ARE SEVERAL ISSUES ABOUT HOW TO PAY FOR THIS $3.

8 TRILLION IN TAX CUTS OVER THE NEXT 10 YEARS THAT ARE STILL OUT THERE. CHIP ROY FROM TEXAS, HE IS STANDING IN THE WAY. HE WANTS THERE TO BE A WORK REQUIREMENT FOR MEDICAID, FOR THAT TO KICK IN MUCH SOONER.

OTHER REPUBLICANS ARE POINTING TOWARD CURBING THE SUBSIDIES FOR CLEAN ENERGY. SO THERE ARE A LOT OF THINGS STILL OUT THERE THAT HAVE TO BE NEGOTIATED AND IT IS FAR FROM CERTAIN THAT THIS IS GOING TO BE A STRAIGHT MOVE FOR JOHNSON. DANI: HE NEEDS TO HEAD TO THE SENATE AFTER ALL OF THAT AS WELL.

THERE'S A REAL FEAR AMONG MARKETS THAT DEFICITS ARE BALLOONING IS THERE ANY REALLY SERIOUS CONVERSATION IN A DEFICIT RESTRAINT HAPPENING AT THE MOMENT? >> THERE IS CONVERSATION ABOUT IT. THE HAWKS ARE TALKING ABOUT IT BUT THE QUESTION IS REALLY CAN THEY GET THIS PAID FOR?

THE DEFICIT REDUCTION IN PARTICULAR IS REALLY NOT A FOCUS, THEY ARE JUST TRYING TO PIVOT THESE TAX CUTS AND NOT ADD AS MUCH TO THE DEFICIT. AGAIN, IF YOU TALK TO CHIP ROY FROM TEXAS THEY ARE GOING TO BE CONCERNED ABOUT THIS, BUT ARE THEY GOING TO STAND IN THE WAY OF A BILL THAT HAVE THESE MASSIVE TAX CUTS IF IT IS ADDING LESS TO THE DEFICIT? IT SEEMS UNLIKELY GIVEN THAT THEY LET IT PASS THROUGH.

AGAIN, IT GOES DOWN TO THEIR CORE DEMANDS ON SOME PRINCIPLES AND TO THEIR DISTRICTS ABOUT WHAT THEY WILL SUPPORT, BUT OVERALL I DON'T THINK WE SEE ANY LOWERING THE DEFICIT OVER TIME. REPUBLICANS ALSO WALKED BACK SOME IDEAS ABOUT RAISING TAXES ON THE MOST WEALTHY. THAT APPEARS NOT TO BE THE CASE.

AT THE SAME TIME THE PROJECTIONS ARE NOT FOR GREAT GROWTH IN THE COMING QUARTERS AND THIS YEAR. SO DEFICITS HAVE REALLY NOT BEEN AS MUCH A TOPIC AS YOU WOULD THINK AFTER THE DOWNGRADE. DANI: THANK YOU SO MUCH FOR THE LATEST COMING OUT OF WASHINGTON, D.

C. EVEN THOUGH STOCKS ARE SELLING OFF THIS MORNING, MIKE WILSON WRITING THAT YOU SHOULD BE BUYING ANY DIP FIELD BY THE DOWNGRADE SAYING THAT THE ODDS OF RECESSION ARE LOWER AFTER THAT U. S.

-CHINA TRADE DEAL. SPEAKING OF STOCKS SELLING OFF, NVIDIA IS AMONG THEM. SHARES ARE LOWER IN THE PREMARKET THIS MORNING LARGELY DRIVEN BY ALL OF THE MAG SEVEN FALLEN WITH BOND YIELDS GOING ABOUT 5%.

ELSEWHERE WE DID HAVE THE CEO UNVEILING FASTER CHIP SYSTEMS, SOFTWARE AND OTHER NEW TECHNOLOGY AT THE EVENT IN TAIWAN. >> THIS YEAR IN Q3 WE WILL UPGRADE TO GRACE BLACKWELL GB 300. GB 300 IS THE SAME ARCHITECTURE, SAME PHYSICAL FOOTPRINT, SAME ELECTRICAL AND MECHANICAL'S, BUT THE CHIPS INSIDE HAVE BEEN UPGRADED.

DANI: CHARLIE, OVERSHADOWED THIS MORNING BUT WE HEARD ABOUT WHAT IS HAPPENING ELSEWHERE IN MARKETS, BUT WAS THERE ANY INCLINATION WHETHER THIS WAS ENOUGH TO KIND OF MAKE UP FOR SOME OF THE MARKET SHARE LOSS AND THE DEMAND LOSS COMING FROM CHINA RESTRICTIONS? >> THAT'S A REALLY GOOD QUESTION AND THINK ONE OF THE KEY THEMES IS THE DIFFERENT FIVE OF THE SHOW VS. PRIOR YEARS.

I THINK THE MOST STRIKING HERE AND MAYBE THE MOST CONSEQUENTIAL IS LINK FUSION. THAT IS A NEW VERSION OF A SYSTEM THAT WOULD ALLOW NVIDIA CUSTOMERS TO DEPLOY RIVAL CHIPS IN SYSTEMS ULTIMATELY BASED ON NVIDIA'S TECHNOLOGY, AND THAT IS A BIG OPENING UP OF NVIDIA SYSTEMS. I THINK THAT SPEAKS TO THE THEMES THAT WE ARE REALLY SEEING AT THE CONFERENCE WHERE IT IS LESS ABOUT THIS EXUBERANCE, THIS EXCITEMENT, AND MORE ABOUT THIS INSISTENCE TO JUSTIFY IT AND TO MAINTAIN THEIR LEAD OVER RIVALS THAT IS INCREASINGLY UNDER COMPETITION.

DANI: THIS COMPETITION AND THIS PRESSURE FROM POLICY. ALIBABA SHARES FALLING, DOWN I THINK ABOUT 2%. THERE SEEMS TO BE A NEW YORK TIMES REPORT ON A TRUMP CONCERNS ABOUT ALIBABA AND APPLES DETAIL.

WHAT WITH THE DETAILS THERE? >> THIS COMES AT A DIFFICULT MOMENT FOR ALIBABA WHO JUST REPORTED A WORSE THAN EXPECTED EARNINGS REPORT. THIS INDICATION THAT THE TRUMP ADMINISTRATION HAS BEEN LOOKING INTO A POTENTIAL DEAL BETWEEN ALIBABA AND APPLE, FOR APPLE TO DEPLOY AI SERVICES IN CHINA.

THIS IS NOT GREAT NEWS FOR ALIBABA BUT IT IS ALSO BAD FOR APPLE BECAUSE APPLE NEEDS A LOCAL PARTNER IN CHINA IN ORDER TO ROLLOUT THESE ALL IMPORTANT AI FEATURES ON THE IPHONE. THE CHINESE MARKET OF THE SECOND MOST IMPORTANT FOR APPLE AFTER THE UNITED STATES AND THESE FUTURES ARE A KEY WAY FOR APPLE TO TRY TO COMPETE IN THAT HOT CHINESE MARKET WHERE THERE ARE A LOT OF OTHER COMPETITORS, AND A LOT OF OTHER AI PARTICIPANTS. THIS IS NOT GREAT FOR APPLE, NOT GREAT FOR ALIBABA.

THIS IS CERTAINLY PUTTING BOTH OF THOSE COMPANIES UNDER PRESSURE RIGHT NOW. DANI: THANK YOU SO MUCH FOR YOUR REPORTING THIS MORNING. EARNINGS SEASON CONTINUES ON.

ROBUST DEMAND, HIGHER TICKET PRICES IN EUROPE. TOM MACKENZIE SPOKE WITH CEO MICHAEL O'LEARY FOLLOWING THE RESULTS FROM THE AIRLINE. >> I WAS WRITTEN TO BY A U.

S. LAWMAKER ASKING ME NOT TO BUY GARRITY CHINESE AIRCRAFTS BUT I KEEP SAYING GO TO HELL. WE WILL RESERVE THE RIGHT TO BUY AIRCRAFTS WHEREVER WE SO WISH.

>> NOT CERTIFIED YET. >> WON'T BE CERTIFIED FOR ANOTHER FIVE OR 10 YEARS BUT WE'VE BEEN LOOKING TO SOME COMMERCE IN THE U. S.

HIS IPHONE WAS MADE IN CHINA ASKING RYANAIR TO GUARANTEE NOT TO BUY CHINESE AIRCRAFTS. WE GIVE NO SUCH GUARANTEES AND I DON'T SEE ANY GREAT PROSPECT OF US FIND AN AIRCRAFT. YOU LOOK AT OUR NUMBERS THIS MORNING, WHICH HAVE BEEN DRIVEN BY THE BOEING CHANGE.

THOSE AIRCRAFTS OFFER 4% MORE SEATS AND 16% LESS FUEL. THEY ARE TRANSFORMING OUR ECONOMICS. ADDING THOSE NEW AIRCRAFT OF THE DECLINING COST OF OIL FOR THE FORESEEABLE FUTURE, NOT JUST RYANAIR, BUT THE AIRCRAFT SECTOR IN GENERAL LOOKS FOR TWO OR THREE YEARS OF REASONABLY STRONG EARNINGS.

>> THAT $62 PER BARREL ON BRENT, YOU'VE HEDGED TO THE UPSIDE, OR ARE YOU WELL PROTECTED ON LOWER PRICES? >> WE'VE GENERALLY BEEN. WE WERE HEDGED IN THE LAST YEAR, 85% HEDGED THIS YEAR.

ABOUT 4% FUEL SAVING. WE TOOK ADVANTAGE OF THE UNCERTAINTY OR INDEPENDENCE DAY, WHATEVER IT WAS LAST MONTH. WE HEDGED ABOUT 40% OF SUMMER 2026 FUEL.

ABOUT $66 PER BARREL. THAT IS ABOUT A 13% SAVINGS ON FUEL INTO NEXT YEAR. OUR ANNUAL FUEL BILL IS ABOUT $5 BILLION.

IF WE COULD HEAD OUT THE REMAINDER OF NEXT YEAR, YOU'RE LOOKING AT FEEDING 700 MILLION, EIGHT HUNDRED MILLION DOLLARS GOING STRAIGHT TO THE BOTTOM LINE WHICH WOULD CREATE ENORMOUS OPPORTUNITY FOR RYANAIR TO MEANINGFULLY LOWER THE COST OF AIR TRAVEL ACROSS EUROPE NEXT YEAR. DANI: MICHAEL O'LEARY SPEAKING WITH TOM MACKENZIE. ALSO SPEAKING ON THE ANALYST CALL AT THE MOMENT SAYING THAT THEY CAN AVOID TARIFFS BY TAKING JET DELIVERIES IN THE U.

K. SO YOU SEE THIS REAL ATTEMPT BY COMPANIES TO TRY TO ADJUST AND TRY TO ADAPT EVEN IF THEY ARE BASED IN IRELAND. COMING UP, WE SET UP FOR THE WEEK AHEAD.

WE WILL TAKE A LOOK AT YOUR TRADING DIARY NEXT ON YOUR BLOOMBERG BRIEF. ♪ DANI: IT'S YOUR BLOOMBERG BRIEF, LET'S GET YOU SET UP FOR YOUR TRADING WEEK ON THIS MONDAY. JP MORGAN'S INVESTOR DAY CONFERENCE WILL BE KICKING OFF AT 8:00 A.

M. EASTERN. THEN PRESIDENT TRUMP IS SCHEDULED TO SPEAK WITH PRESIDENT PUTIN OF RUSSIA AT 10:00 A.

M. TO DISCUSS HOW TO END THE WAR IN UKRAINE. AND THEN LOWS AND TARGET REPORT EARNINGS.

THAT HAPPENS WEDNESDAY. A QUICK LOOK AT MARKETS HEADING TO THE END OF THE HOUR, BECAUSE YOU HAVE THIS MIX, THAT IS YOU GET RISING DEFICITS IN THE REACTION IS TIGHTER FINANCIAL CONDITIONS ACROSS THE BOARD. SELLING OFF YOUR 30 YEAR YIELDS, BACK ABOVE 5%.

WE ARE UP BY MORE THAN 7. 5 BASIS POINTS THIS MORNING. LAST TIME WE HAD ABOUT 5% IT WAS 2023.

WE'RE IN THE THROES OF INFLATION BUT WE DID HEAR FROM MIKE WILSON SAYING THAT ANY DEBT RELATED THAT DOWNGRADE IN STOCKS YOU SHOULD BE BUYING AND A DIP WE ARE HAVING THIS MORNING. WE HAVE LESS OF A CHANCE OF THE RECESSION BECAUSE THE CHINA U. S.

TRADE DEAL, THEREFORE STOCKS ARE BUYING. SURVEILLANCE IS UP AHEAD ON THIS MONDAY MORNING. THIS IS BLOOMBERG.