Update: Carney Wins, Spain Blackout Mystery, Trump's First 100 Days
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Bloomberg Audio Studios. Podcasts. Radio. News. This is the Bloomberg Daybreak Q at Podcast, available every morning on Apple, Spotify or wherever you listen. It's Tuesday the 29th of April here in London. I'm Caroline Hepker. And I'm Jack Sidders. Coming up today, Mark Carney's Liberals secure a narrow victory in a Canadian election dominated by frosty US relations.

The cause of a massive blackout across Spain and Portugal remains a mystery as power returns. Plus, Trump's second first 100 days. The US president looks to tout his successes as polling shows ebbing support for his economic policies. Let's start with a roundup of our top stories. Mark Carney's Liberal Party is projected to win a fourth consecutive election, marking a major turnaround for the party.

Despite the victory, it's likely the party will fall short of the 172 seats needed for an outright majority in the House of Commons. The narrow margin means the former central banker will need to work with other parties to pass legislation as he navigates trade hostilities with the Trump administration. And in his victory speech, Carney echoed his campaign comments. Our old relationship with the United States, a relationship based on steadily increasing integration, is over. The system...

of open global trade anchored by the United States. A system that Canada has relied on since the Second World War. A system that, while not perfect, has helped deliver prosperity for a country for decades is over. We are over the shock of the American betrayal, but we should never forget the lessons.

The former head of Canada's and Britain's central banks, Mark Carney became Liberal leader on March 9th and called an election just two weeks later. Campaigning as a tough opponent to a US president who has repeatedly suggested Canada should become a US state. After steering two G7 central banks through the 2008 financial crash and Brexit, Carney must now prove to voters that his reputation as a crisis manager can extend into the political arena.

Power has been almost fully restored in Spain and Portugal after the two countries were hit by a sweeping power cut on Monday. Millions of people were caught up in the chaos after the mass blackout brought many areas of life to a standstill with trains stopping, planes grounded, internet and mobile phone services cut,

traffic lights and ATMs down. The cause of the blackout remains unknown though with the Spanish Prime Minister Pedro Sanchez saying that experts have not yet been able to determine the cause.

We still have no conclusive information about the reasons for this outage. The power supply has already been restored in several territories in the north and south of the peninsula, thanks to the interconnections with France and Morocco.

The words of Pedro Sanchez there, spoken via a translator. A blackout of this scale is rare in Europe and highlights the fragility of the grid as the region shifts to renewable energy. Spain may also face scrutiny, though, over plans to decommission nuclear plants, which supply 20% of its power, and the closure of its last coal plant.

powered plant this year in favour of renewables backed by gas. HSBC is to buy back another $3 billion of shares as profits come in well ahead of estimates. Bloomberg's Ewan Potts has more. It's a big beat for HSBC. Europe's largest bank has reported a pre-tax profit of $9.48 billion for the first quarter, well ahead of estimates for $7.8 billion.

The London-based lender is to buy back another $3 billion of shares after what it called the strong results and momentum in earnings. As to the outlook, watch this space. HSBC is the largest non-US clearer of dollars, so is highly exposed to the growing rift between Washington and Beijing. In London, I'm Ewan Potts, Bloomberg Radio.

Now, let's think about other earnings. A key story from Deutsche Bank. The German lender reported profits and revenues that beat estimates for the first three months of this year. Pre-tax profits came in at 2.8 billion euros in the first quarter. That's more than 200 million higher than estimates. Fixed income sales and trading revenue at Deutsche Bank also beat at 2.9 billion euros. Deutsche Bank CFO James von Moltke says the bank is benefiting from global volatility.

The crystal ball is cloudy. As we think about it though, first of all, our company is well equipped to navigate an environment like this, whether it's risk management or the great client franchise we have, as well as the very strong balance sheet. We are equipped to navigate ourselves and more importantly, help clients through what is an unsettled environment.

Deutsche Bank CFO there speaking to Bloomberg. He added that the bank has to look at the near-term future with some caution. It's the latest set of bank earnings showing how traders have made big profits on the market volatility set off by the Trump administration. U.S. President Donald Trump is on track to ease some tariffs on car manufacturers. Some levies on importing foreign parts will be lifted and there will be a reprieve to prevent steel and car tariffs overlapping.

Two days ago, Trump had doubled down on his trade policy, saying it would lead to lower taxes. A lot of money from tariffs. We were losing a lot before I got here. We were losing billions of dollars a day, and now we're doing great, and we haven't even kicked in yet. And eventually we'll be reducing taxes very substantially for the people of our country because the money is so great coming in from tariffs that I'll be able to reduce taxes to a very large extent and maybe almost completely.

The US president could sign off on the shift as soon as today, ahead of a speech he's giving in car-making state Michigan. The latest evolution of Trump's trade policy comes as the Dallas Fed Manufacturing Index posted its worst reading since 2020, with executives using words like chaos and insanity to describe the fallout of tariffs.

Meanwhile, China's top diplomat says that appeasing a bully will only make America bolder. Foreign Minister Wang Yi urged countries around the world to stand up to the United States as his office released a propaganda video saying China won't kneel down. The EU's Economy Commissioner, Valdis Dombrovskis,

says that they are still engaging with America, but that he had a message for China too. It's important also that China shows restraint, that it does not put all this now, our capacity of goods to other markets, including EU, because then we will have to react, we will have to close our market to protect our economy, our companies, and that will lead even to further global economic fragmentation.

The EU's Valdis Dombrovskis speaking to Bloomberg there. Washington has insisted that the ball is in China's court to de-escalate the trade war, but Beijing has demanded a cancellation of all US tariffs before any negotiations begin.

CEOs from firms including NVIDIA, Eli Lilly and SoftBank will visit the White House tomorrow to highlight their U.S. investments as the president celebrates 100 days in office. The event will come after Trump attends a Michigan rally today to mark the milestone where he is expected to tout his administration's estimated $2 trillion in corporate commitments. But amidst the White House festivities are warnings from Wall Street leaders about price increases and fallout from a U.S.-led trade war.

Lori Calvasina, head of U.S. equity strategy at RBC Capital Markets, says firms are facing uncertainty. I think it was an intellectually honest conversation we got from companies saying, you know, look, we're not changing our guidance because we think we can manage this too. We're not going to do annual guidance anymore. We're going to do quarterly guidance instead. We can't give you anything right now. We'll give you an answer when we have one, and we're not going to give you one until we're comfortable.

RBC's Laurie Kalvisina speaking there. Donald Trump is also facing sinking popularity with a flurry of polls showing voter disapproval of the president's economic stewardship. Gauges from CNN and NBC show just 39% of Americans agree with the White House tariff rollout.

Those are our top stories for you this morning. Now, let's get to the markets. Asian equities higher. The possibility that President Trump may ease his auto tariffs has helped to lift some of the automakers in Asia. Kia, Hyundai and Toyota all rising in trading this morning. MSCI Asia Pacific Index up by three tenths of one percent. As for stock futures, they are

Thanks, David.

Looking at the loonie this morning, weakening three-tenths against the U.S. dollar on the Canadian election result. And I'll mention a couple of earnings out today. BP adjusted net income for the first quarter, misses average analyst estimates. They're planning a share buyback, $750 million. And AstraZeneca earnings per share come in as a big beat, $2.49 for core earnings per share from AstraZeneca.

Thanks, Caroline. Yeah, lots of earnings headlines today. And in just a moment, we'll talk about Trump's first 100 days with EMEA News Director Rosalyn Matheson. But before we do, another story that caught our eye this morning, the blackout in Spain and Portugal, which remains a mystery.

It was chaos for 60 million people on the Iberian Peninsula. No internet, no lights, trains came to a standstill, thousands of flights cancelled, ATMs stopped working, stock market operated as normal, but backup generators. Yes, and that's the issue that we still really don't understand. What...

what oscillation means. That was what the red electric, the electricity grid, blamed for this massive blackout across Portugal, Spain, even affected some parts of France. We had our writers, Ben Sills, our colleagues in Madrid out and about. He wrote a piece about how the students were all, you know, lying on the grass, not working because all of their...

books effectively are online. They don't actually have physical books anymore. Our opinion columnist, Javier Blas, also posting about this throughout the day. His father apparently was complaining that his reclinable chair is electric and that it wouldn't work. So it disturbed his siesta. So look, lots of people, you know, would...

trying to enjoy the afternoon as best as they could. But there were a lot of worries about kind of what this means. It's very rare for there to be such a huge blackout. So there'll be loads of questions about it. Now, let's get the latest on the Canadian election results and a fourth consecutive term for Liberal Party, but only a narrow margin of victory.

It's one incoming Prime Minister, Mark Carney, secured by doubling down on one issue, standing up to Donald Trump. Our EMEA News Director, Rosalind Matheson, joins us now for more. Morning, Rosalind. So, Mark Carney referred to America's betrayal. China have called the US a bully. Does this election mark a turning point for global views towards the US?

Well, yes and possibly no. I mean, as you say, it was actually quite a narrow victory for Mark Carney and there's some possibility he'll have to end up running a minority government operating with the party that tends to field candidates only in

because it was interesting to see the Conservatives make some inroads in the Liberal heartlands in Toronto and Ontario. So those are long, long, long voters for the Liberals. And that's despite that strong sense of grievance that you see coming from Canadian people in general at the way that the relationship with the US has broken down because of

of course, for many Canadians, it's quite personal to see the way that, you know, the US administration is talking about them and talking about making them yet another state of the US. And in spite of all of that, and obviously Carney, you know, he did turn things around from the popularity of the Liberals only some months ago, but it wasn't quite the victory that perhaps he was looking for in a convincing sense.

And perhaps that means that people are worried that, you know, yes, they're concerned about Donald Trump. But if you stand up to him too much, do you bring too much economic pain back on yourself? Yeah, Carney talks about it being a hinge moment in history that he wants to make Canada an energy superpower and also to double home building. So he was very much also trying to talk to the domestic audience as well as the kind of the global backdrop. I mean,

Thinking about President Trump's policies as we're 100 days in now to his second administration, it was very interesting to read the Dallas Fed survey yesterday and the views of American business leaders, manufacturers, chaos and insanity, the result of Trump tariffs. Very strong language.

Well, it's interesting because, you know, quite a few CEOs have welcomed the Trump administration, said they were looking forward to it. What they're looking for is a government that's obviously low regulation for a start, that's very much pro-business. And, you know, Donald Trump is...

on a surface level saying things they want to hear. He wants to bring business back to the US. He wants to make the US, you know, greater again, even than it was perhaps in his first term. But it's the way he's going about it that's causing this disruption that they're probably referring to, which is this very, very dizzying pace of,

of policymaking, the abrupt changes of position that are coming. So he can change his mind a couple of hours after announcing something. And if you're a big company trying to, you know, develop your structure going forward, that's a really difficult environment to be operating in. And, you know, the concerns are that what you see is sentiment effects on US consumers, US consumers stop spending, you know, companies stop hiring. And so that's really what CEOs are

are worried about. Many of them, as I said, do actually support the overarching message that comes from Donald Trump. They're concerned, though, obviously, about the way that he's doing it. So, yeah, business leaders struggling to cope with the uncertainty. But what about U.S. voters? After 100 days of Trump, what's their verdict on the president's aims to remake the U.S. at home and abroad?

Well, you can see that concerns are showing up there also. I mean, the polling shows that Donald Trump's popularity is taking a hit and that's certainly something he's probably going to be very attuned to. You can see that in the possible reversal coming on auto tariffs.

to give relief to auto companies. He's going to Michigan today to make a big speech to mark his 100 days at a time that auto companies say we're really worried about our outlooks here and whether we can continue to employ all our workers. So you see a lot of uncertainty coming in for the ordinary American in terms of, you know, their job security. You see the cuts to government entities and so on. And he's very, very attuned to that.

And, you know, that's why he's pushing his tax cuts to try and get those through Congress quicker than he initially had said. So he wants to deliver something to them pretty quickly on the tax side. And that's obviously a high concern for him.

And then, of course, there's China and how they are dealing with Trump and tariffs. In a meeting of BRICS countries, China was basically telling them to stand firm that appeasement would only embolden the bully. And they have repeatedly said they aren't engaged in any trade talks, even though that is what the Trump administration wants.

Yeah, it's that tomato-tomato thing of are they actually talking in some fashion? Is it a formal versus informal thing? I mean, obviously, you can see that, you know, having Trump come quite aggressively for China is actually helpful for Xi Jinping at home. He's really pushing that narrative. You can see the administration there really leaning into that for their own support at

at home but it also reflects these efforts by the US to try and peel countries away from China because right now if you're Europe you're saying well I can't put all my eggs in the US basket so we're going to have to talk to China on trade we're going to have to talk to countries in the Middle East on trade we have to diversify and Donald Trump is looking at that saying oh I don't want that to happen so he's trying to now say to countries I don't want you getting too close to China.

He really, really does not like the BRICS. And of course, that's a group that's been expanding heavily over the past few years. He doesn't want those countries drawing closer to China. And that's really where that tension is coming. Fascinating. Yes, such an uncertain geopolitical environment. Ros, thank you for joining us. Our EMEA News Director, Rosalind Matheson, there.

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Now, lots of earnings today, and HSBC has reported pre-tax profit for the first quarter that beat the average analyst estimate, with CEO George L. Hedry, who took on the top job in February, calling the numbers strong results. Joining us now is Bloomberg's Charlie Wells. Morning, Charlie. So talk us through HSBC earnings amid the

difficult backdrop of tariffs and US-China tensions. Yeah, Jack, so there's been so much concern that this bank, probably in contrast to so many of the others, both in Europe and on Wall Street, has that huge Asia exposure, and it's also got that huge trade facilitation exposure. And so those themes in the markets right now

have been what have made analysts and investors nervous. At least for this quarter, a lot of those fears have been put to rest. They did have that significant profit beat. But I think maybe even better for a lot of these investors is the $3 billion stock buyback that they announced. So that's going to

please a lot of people. Also, you know, this whole earnings season, whatever business we're looking at, I think the big question has been, okay, sure, you had a great first quarter. That's fine. What does the rest of this year look like? And what's really striking here, what is a story of strength that HSBC is able to tell, they're keeping their guidance for the year ahead after evaluating plausible scenarios. Okay, so that's on HSBC. Meanwhile, Deutsche Bank earnings, the

CFO James von Moltke speaking to Bloomberg, as he usually does, speaking to Bloomberg TV, saying that some of their business units slowed dramatically in April. That's a statement. It is a statement. I think it's this kind of mixed picture that we're getting. I think on the positive side for this bank, they had fixed income trading revenue that beat estimates. But I think they're trying to square the circle here, right? Where

There may have been a slowdown in some areas. There's a lot of uncertainty. And I think one of the big questions is, you know, many of these banks got boosts from volatility. And I think, are we moving from an era where there's this kind of good volatility that helps trading or...

And are we moving to a period where there is bad volatility, where market participants start sitting on the sidelines? I think that's one of the real tough questions that we'll have to keep asking. Good volatility and bad volatility. I like that. Okay. So, away from the banks, what else are we watching this morning in EMEA earnings? Yeah. So, look, we're getting some really interesting updates from across the board. BP first quarter earnings are out. And, you know, the

We were just talking about buybacks. They were able to announce a buyback on the lower end of the guidance, so that's not going to be great. BP's been under pressure, right? That oil price slide amid all of this uncertainty and also the increase in supply that we've seen in the market. That's really difficult for them as well.

And, you know, the automotive sector as well. Porsche cut its full year operating return. This is a company that's really in the crosshairs of these transatlantic tariffs because they produce a lot of their luxury vehicles in Europe and then export them to the United States. That's difficult for them. So, yeah, more earnings on automotive coming this week as well.

This is Bloomberg Daybreak Europe, your morning brief on the stories making news from London to Wall Street and beyond. Look for us on your podcast feed every morning on Apple, Spotify and anywhere else you get your podcasts. You can also listen live each morning on London DAB Radio, the Bloomberg Business App and Bloomberg.com.

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