Stocks Fall on Global Trade War Fears; Democrats to Block GOP Plan to Avert Shutdown
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Good morning, I'm Nathan Hager. And I'm Karen Moscow. Here are the stories we're following today. Karen, we begin with the latest developments in the global trade war. President Trump says the U.S. will respond to retaliatory tariffs from the European Union. As heard on Bloomberg Radio, the president spoke in the Oval Office after the EU announced levies on industrial and agricultural goods worth up to $28 billion. The European Union treats us very badly.

They have for years. I saw that. I had it out with them in my first term. It did well, but we had to solve other problems, and we did. But the European Union's been very tough, and it's our turn, too. You know, we get a turn at that also.

Canada also announced 25% tariffs on nearly $21 billion worth of U.S.-made products. Stay with Bloomberg for full tariff coverage. We're going to be speaking with Commerce Secretary Howard Lutnick at 8 a.m. Wall Street time on Bloomberg Radio, Bloomberg Television, and the Bloomberg Podcasts page on YouTube.

Nathan, another major story we're following. The deadline is ticking to a possible government shutdown. Senate Democratic Leader Chuck Schumer says his party will block a Republican spending bill to avert a shutdown. Bloomberg's Amy Morris has the latest from Washington. Senator Schumer told his colleagues on the Senate floor Republicans just don't have the votes they need. Republicans do not have the votes in the Senate to invoke cloture on the House CR. Our caucus is unified.

on a clean April 11th CR that will keep the government open and give Congress time to negotiate bipartisan legislation that can pass. In the Senate, 60 votes are necessary to cut off procedural hurdles, and Republicans only have 53. This significantly raises the chances of a government shutdown at the end of this week.

In Washington, Amy Morris, Bloomberg Radio. Amy, thank you. Now to the latest on the war in Ukraine. President Trump's Middle East envoy, Steve Witkoff, is headed to Moscow this week to present a 30-day ceasefire proposal to Russian President Vladimir Putin. The U.S. reached the deal with Ukraine and talks in Saudi Arabia. President Trump says he hopes Putin takes it. We have a...

Full ceasefire when it if it kicks in but we have to see it's up to Russia now and Bloomberg's Greg Sullivan reports Putin will probably agree to the truce eventually but he'll want his own concessions made first longer term he has made some Significant concessions one. He doesn't want NATO peacekeepers in Ukraine as part of any sort of ceasefire deal - he doesn't want a Ukraine to join NATO he wants territorial concessions starting with what he's made from the war gains

And he wants a smaller Ukrainian military. In the short term, Bloomberg's Greg Sullivan reports Putin might also demand a halt on weapons supplies to Ukraine. Ahead of his meeting with Steve Witkoff, Putin made an unexpected visit to the Kursk border region. Russia says it has pushed back Ukrainians from more than 86 percent of the territory they seized there in their surprise incursion last August.

Well, Nathan, we turn to the markets now where futures are lower once again over growth concerns and recession fears. Some strategists on Wall Street are cutting their forecasts for U.S. stocks. Perennial bull Ed Yardeni has lowered his year end for the S&P 500 to 6,400 from 7,000.

He said President Trump's tariffs have heightened the risk of stagflation. On the flip side, JPMorgan Chase said the worst of the U.S. equity correction may be over. The firm said credit markets are indicating a lower risk of a recession happening. David Sowerby, managing director of Ancora, agrees. He says now is a buying opportunity. You can't call a market bottom, but when sentiment gets unduly bearish and it's there now, if you look 12 months out,

11 out of the last 12 times it's gotten this bearish, the market's higher, and the average return over the next 12 months

is 20%. I don't know if it's going to be 20%, but I like those odds knowing I make my most money when I run against the herd and I'm a contrarian, which is more what you need to be today. And Cora's David Sowerby, the S&P 500 is trading about 9% below its all-time high. Karen, a change in the executive suite has shares of Intel trading higher by 10%. Let's get the very latest with Bloomberg's John Tucker. John. And Nathan Lipp,

Bhutan was named to the CEO job. Not exactly a household name, but he's a real solid reputation in the industry. Investors applaud his arrival, despite the lack of a clear signal that he's going to take Intel in a new direction. In fact, his first message to employees is that he's going to keep working to make Intel a

top foundry, that's a business that produces chips for outside clients. That endeavor has been costly for Intel so far and contributed to the ouster of the former CEO, Pat Gelsinger. The company lost $19.2 billion last year. Still an open question whether TAN might split up the foundry and the chip design business

Intel stock had rallied last month on anticipation that the company would be broken up. Right now, the stock, the most actively traded pre-market, again, up just about 10%. In New York, I'm John Tucker, Bloomberg Radio. All right, John, thank you. Another tech news this morning. The Federal Trade Commission is moving ahead with an antitrust probe of Microsoft that was opened in the waning days of the Biden administration. We have more from Bloomberg's Justin Teresi. I think

this is very interesting here. It's kind of the first signs we're seeing of what this new FTC under the leadership of Andrew Ferguson is really going to do. And I think there's been a lot of discussion about will there be this forceful activity against big tech? Will there not be? And it seems like not really surprising. I think this is the first indicia we're seeing that that crusade, if you will, against big tech might be continuing in some ways.

And Bloomberg's Justin Teresi says the FTC sent Microsoft a so-called civil investigative demand. The document compels the company to turn over reams of data about its AI operations, including the cost to train models and obtain data going as far back as 2016.

In Europe, Karen, Deutsche Bank is rewarding its employees. Germany's largest lender increased its bonus pool to the largest amount in a decade following a surge in deals and trading last year. Deutsche awarded $2.7 billion in variable compensation to staff for their work in 2024. That is a 26% increase from the year earlier.

Well, here in the U.S., Nathan, more than 1,600 financial firms and their subsidiaries have tapped the Federal Reserve's emergency lending program. It was created to support the industry during the regional banking turmoil two years ago. Beal Bank USA and First Republic Bank borrowed the most, with each taking out loans exceeding $8 billion. And finally, Karen, two NASA astronauts have been stuck in space for months. Going to have to wait a little longer to come home. A launch pad problem prompted SpaceX's

to delay a flight to the International Space Station. Dragon, SpaceX LD on countdown one. At this time, we are standing down from today to further address hydraulic release data. That stand down came less than an hour before scheduled launch with the crew already seated in the capsule. Now the launch is expected to take place no earlier than tomorrow night. The new crew needs to get to the ISS before Butch Wilmore and Sonny Williams can head home after nine months in orbit.

Time now for a 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. A government lawyer has asked a federal judge to move the legal fight over the detention of Columbia graduate student Mahmoud Khalil to either New Jersey or Louisiana. The request was made during a hearing in New York City. Khalil is in an immigration detention facility in Louisiana, a thousand miles from New York.

The Trump administration is trying to deport Khalil over his role in pro-Palestinian protests at the Ivy League school last year. Khalil had a green card and a student visa that were both revoked last week. Border Czar Tom Homan talked about the case in Albany, New York. Coming to this country either on a visa or becoming a resident alien is a great privilege. But there are rules associated with that.

After his detention last weekend, Judge Jesse Furman in New York ordered that Khalil not be deported while the court considers his lawyer's legal challenge.

The amount of fentanyl seen at the U.S.-Mexico border fell dramatically since January to its lowest level since December 2021. According to new U.S. Customs and Border Protection data, about 590 pounds of the deadly synthetic opioid were intercepted in February, down 40 percent from January's 990 pounds.

An atmospheric river is taking aim at California, bringing the risk of mudslides to burn-scarred areas. But as the system moves east, it will bring the threat of snow to places like Utah, followed by severe weather threats to the east coast by the weekend.

Bloomberg's Craig Allen has more. Michael, this latest atmospheric river is packing such a wallop for the entire West Coast with flooding occurring from San Diego all the way on up the Pacific Coast Highway, the 5, right on up through Seattle. There is extreme amounts of snow and wind that are blowing across the Cascades as well as the Sierras. And the Winter Storm Severity Index indicates

is major to extreme in some portions of California right on up into the mountain passes of Oregon and Washington. Bloomberg's Craig Allen. Finally, Manhattan apartment rents reached a record high in February with a median of $4,500, according to appraiser Miller Samuel and brokerage Douglas Elliman.

That's up 6.4% from last year. Global News, 24 hours a day and whatever you want it with Bloomberg News Now. I'm Michael Barr and this is Bloomberg, Karen. All right, Michael Barr, thank you.

When you have bars in the sky, onboard showers and award-winning in-flight entertainment, it's no surprise that Emirates was recently named the best airline in the world. We fly you to over 140 destinations and with partners across the globe, we connect you to another 1,700 cities across six continents. So when we say we're also the largest international airline, what we really mean is...

If you're going there, so are we. Book now on Emirates.com. Fly Emirates. Fly better.

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Time now for the Bloomberg Sports Update brought to you by Tri-State Audi. Here's John Stashower. John, good morning. Good morning, Karen. The day began with Mikael Bridges telling the New York Post that perhaps Knicks coach Tom Thibodeau is playing his starters too much. Bridges leads the NBA in minutes played. He said it's not fun on the body. And then in Portland, he was on the floor for 41 minutes of a 53-minute game. At the end of overtime, Bridges had the ball in his hand.

Bridges to inbound. Nick's break. Hart gets it. Right back to Bridges. Bridges puts up a three. And Mike Green went double bang on MSG. The Knicks top the Blazers in a thriller. Won 14-1, 13. Bridges scored 33 points. A back-to-back road wins without the injured Jalen Brunson. And the trip ends Saturday at Golden State. And Boston, Oklahoma City beat the Celtics.

118 to 112. American University headed to the NCAA tournament. Easy win over Navy in the Patriot League final. Big East underway at the Garden. Seton Hall's season ended with a loss to Villanova. The Pirates had that big upset of UConn, but they only won six other games. St. John's has won 27, 18-0 at home. And the Red Storm have a noon tip-off today at MSG against Butler. Season finale for Rutgers, a Big Ten victory.

Double overtime loss to USC. Scarlet Knights were under .500 despite having two freshmen, Ace Bailey and Dylan Harper, who are now expected to go pro and be lottery picks. Fordham has lost 20 games with the Rams, upset Rhode Island to advance at the Atlantic 10. Players' Championship teeing off today at Sawgrass. The marquee threesome has the defending champ, Scotty Scheffler, playing with

Rory McIlroy and Xander Shoffley starting at 130. And Indian Wells, Coco Gauff out in the third round, upset by Belinda Bensich. The Giants search for a quarterback as them getting a visit tomorrow from 36-year-old free agent QB Russell Wilson. John Staschauer, Bloomberg Sports, Karen Nathan.

Coast to coast on Bloomberg Radio. Nationwide on Sirius XM. And around the world on Bloomberg.com and the Bloomberg Business App. This is Bloomberg Daybreak. Good morning. I'm Nathan Hager. There may be more worries about an escalating trade war moving through markets. President Trump says he will respond to the European Union's countermeasures against 25% steel and aluminum tariffs. And the president is repeating his longstanding criticisms of the bloc.

The EU was set up in order to take advantage of the United States. Including Ireland? Is Ireland taking advantage of the U.S.? Of course they are. President Trump said that in the Oval Office with Irish Prime Minister Michael Martin sitting right next to him in Washington for St. Patrick's Day festivities. Joining us now, Bloomberg News Senior Editor Bill Ferrys. Bill, good morning. What could the response look like?

Good morning, Nathan. Well, we already heard from the EU president about a potential 26 billion euro response to this latest round of tariffs. And the EU is talking about things like soybeans from the American South. And we know from their previous tariffs during the first Trump administration that they like to look at very iconic tariffs.

American products, and that's included in the past Harley-Davidson motorcycles, Kentucky bourbon, things like that. But they're talking about a figure that they say is in line with the price that Europe is being asked to pay here, about 26 billion euros. And that's just the latest of these skirmishes. Of course, the big date on all of our calendars now is April 2nd, and that's when President Trump said he wants reciprocal tariffs to come in

for all countries that put tariffs on U.S. products. And with that April 2nd date now just a few weeks away, while we've seen this response from Europe, other countries like China have yet to respond. What could negotiations look like with some of the rest of the world?

Well, you know, you saw this flurry of attempts in the last week or so by some countries, particularly Australia, to try to get carve-outs. And if you remember from Trump's first term, that was something he granted to a number of nations, including Australia, including Brazil. He hasn't really issued anything like that this time around.

I think some countries are still in a wait-and-see mode and hoping that maybe they can strike some sort of a deal or that they can make some promises of investment that might end up getting them spared. But so far, I've got to say that, you know, with a couple exceptions, the Trump administration has largely gone forward with what it's threatened on tariffs.

You mentioned April 2nd is the date on everybody's calendars. I wonder if we're starting to circle tomorrow night on our calendars as well with a government shutdown deadline looming.

We sure seem a lot closer to it now after Chuck Schumer said the Democrats would not support Republicans in getting to that 60-vote threshold they need to pass that continuing resolution that came over from the House. Now, you've been through a lot of these last-minute negotiations. There's still at least another, let's say, 36, 48 hours of talks ahead of us, and that's often when things get done.

And there are some Democrats like John Fetterman who don't want to vote against this continuing resolution. So it's not clear if all the Democrats are in line, but certainly the risk of a government shutdown amid all of these all of this other turbulence for federal workers, that risk is rising. Well, if we don't get this House passed bill through the Senate, what's the alternative that Democrats are putting up? Got about 30 seconds left.

There's not a lot of plan B here, but the Democrats have put forward basically a one month spending bill that would keep things open for talks. But remember, if that doesn't go through and the other one doesn't go through, the House is already on recess. It's hard to call them back. It's hard to see how you avoid a shutdown at that

This is Bloomberg Daybreak, your morning podcast on the stories making news from Wall Street to Washington and beyond. Look for us on your podcast feed by 6 a.m. Eastern each morning on Apple, Spotify, or anywhere else you listen. You can also listen live each morning starting at 5 a.m. Wall Street time on Bloomberg 1130 in New York, Bloomberg 99.1 in Washington, Bloomberg 92.9 in Boston, and nationwide on Sirius XM Channel 121.

Plus, listen coast to coast on the Bloomberg Business app now with Apple CarPlay and Android Auto interfaces. And don't forget to subscribe to Bloomberg News Now. It's the latest news whenever you want it, in five minutes or less. Search Bloomberg News Now on your favorite podcast platform to stay informed all day long. I'm Karen Moscow. And I'm Nathan Hager. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak.