US-China Trade Talks; India, Pakistan Trade Military Strikes
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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 lift in futures comes on optimism. Trade tensions may be easing between the U.S. and China. Treasury Secretary Scott Besant and U.S. Trade Representative Jameson Greer will hold trade talks with China's Vice Premier He Li-Fang this weekend.

The officials are due to meet in Switzerland Saturday and Sunday. These will be the first confirmed talks since President Trump announced tariffs of up to 145 percent on Chinese imports and Beijing retaliated with its own levies. Here's Secretary Besson speaking on Fox News.

I think that this is what we're going to do in Switzerland is we've agreed to talk. Then on Saturday and Sunday, we will agree what we're going to talk about. My sense is that this will be about de-escalation, not about the big trade deal. But we've got to de-escalate before we can move forward. Treasury Secretary Scott Besson says current tariff rates are not sustainable and amount to a trade embargo.

Nathan, just hours after the talks were announced, China took steps to boost its economy. The country's central bank cut its policy rate and lowered the amount of cash lenders must keep in reserve. Economists say the decisions demonstrate policymakers are acting with urgency to support the world's second largest economy in the face of the U.S.-China trade war.

Now, Karen, we turn to a tense situation in South Asia between two nuclear-armed powers, India and Pakistan, traded military strikes overnight weeks after a militant attack in the disputed Kashmir region that killed 26 people. India says it hit nine targets, calling them known terror camps. Pakistan's military says the strikes killed 26 civilians. It responded by shooting down five Indian jets. We get more from Bloomberg New Delhi Bureau Chief Debjit Chakraborty.

Both the sides are saying that these were de-escalatory kind of moves. India has said that it only had one thing in their mind, just to target the militants which were trying to destabilize the Kashmir region, the economic development of that path. Pakistan has always said that we won't do anything unless India attacks.

Bloomberg's Debjit Chakraborty says the last time India and Pakistan came close to all-out war was 2019, when a suicide bomber killed 40 members of India's security forces. Nathan, former President Joe Biden has described the White House's approach to Russia as modern-day appeasement. Biden was asked by the BBC what he thought of President Trump's peace plans for Ukraine. It is modern-day appeasement.

Look, listen to what Putin said when he talked about going from Kyiv into Ukraine and why. He can't stand the fact that the Russian dictatorship that he runs, that the Soviet Union has collapsed. And anybody thinks he's going to stop is just foolish.

Joe Biden's interview with a British broadcaster is his first since leaving office. Karen, Senate Majority Leader Chuck Schumer is looking for answers after last month's incident at New Jersey's Newark Airport that left air traffic controllers out of contact with planes for 90 seconds. Transportation Secretary Sean Duffy says the air traffic control system is safe, but Minority Leader Schumer says he has plenty of concerns. First,

the firing of so many employees under Doge has weakened the FAA. Second, a good number of top-level people who are concerned with air safety and flight

safety, have left out of exasperation because they think the people who have been put in charge don't know what they're doing. Senate Minority Leader Chuck Schumer spoke on Bloomberg's balance of power. You can catch the full conversation on the Bloomberg podcast page on YouTube. Transportation Secretary Duffy says a build-out of a new air traffic control system should be completed by the summer, but the current one, he says, has backups for pilots and controllers.

Nathan, President Trump met with Canadian Prime Minister Mark Kearney in the Oval Office. The leader showed no signs of retreating from their differences in the ongoing trade war. And Bloomberg's Amy Morris reports from Washington.

After the meeting, Prime Minister Carney says there will be more talks. We agreed to have further conversations in the coming weeks and we are looking forward to meeting in person at the G7 summit in Kananaskis in Alberta. President Trump told reporters there are no firm trade deals with Canada, China or any other country. We don't have to sign deals. They have to sign deals with us. They want a piece of our market. We

We don't want a piece of their market. We don't care about their market. They want a piece of our market. As for Canada becoming the 51st state, Carney says it'll never be for sale. But Trump told Carney, never say never. In Washington, Amy Morris, Bloomberg Radio. All right, Amy, thank you. Turning to markets now as investors and the Federal Reserve await clarity on the Trump administration's trade policies. The Fed is expected to leave interest rates.

unchanged this afternoon. We get a preview of the decision today from Bloomberg's Michael McKee. There's still no suspense at the Fed. Without any clear idea of who will be taxed, how much, and when, the central bank waits like everyone else for some idea of what the Trump tariffs will do to the economy. So there's little point in changing interest rates.

Fed officials also don't provide new economic forecasts or a new dot plot at this meeting, which pretty much leaves Chairman Powell and his press conference as the only opportunity for headlines, which...

Given the circumstances, he will likely avoid as much as possible. Michael McKee, Bloomberg Radio. Okay, Mike, thanks. And stay with Bloomberg for full Fed coverage on a special edition of Bloomberg Surveillance, The Fed Decides. It begins at 1.30 p.m. Wall Street time on Bloomberg Radio, Bloomberg Television, and the Bloomberg Podcast's YouTube page.

After nine straight days of gains, Nathan Stocks coming off two consecutive losing sessions. Cameron Dawson, the chief investment officer at New Edge Wealth, is cautious. The worst of tariff and trade headlines may be behind us. It's hard to imagine a worse day than the couple days post the Rose Garden announcement. However, we do not think the worst is behind us when it comes to real economic data weakening, the fundamentals showing the signs of

of the weight of these tariffs on them, which just means that, yes, we're getting this relief rally, but we haven't even begun to see the fundamental impact. New Age Wealth's Cam Dawson. One other market note, U.S. companies are planning to buy back their own shares at a historic clip. The value of announced buybacks in the U.S. reached almost $234 billion in April. Barini Associates says that's the second highest monthly tally in records going back to 1984.

With that in mind, Karen, let's take a look at some stocks on the move this morning. For that, we're joined by Bloomberg's John Tucker. John, good morning. Good morning, Nathan. Let's start with the advanced micro devices. They delivered an upbeat outlook. NVIDIA's closest competitor in the area of artificial intelligence processors predicts strong growth in the second half of this year. The first quarter sales rose 36%. That topped estimates...

At the same time, though, the company warned that U.S. restrictions on sales to China will cost it $1.5 billion in revenue this year. The share is up 2% pre-market. Supermicrocomputer shares falling over 4%. The beleaguered chipmaker cutting its net sales guidance for the full year. And finally, Novo Nordisk trimming its financial forecast. But investors looking past that, they're focused on expectations that

competition for its blockbuster obesity shot, Wegovy, will subside later this year. In New York, I'm John Tucker, Bloomberg Radio. All right, John, thank you. And weight loss drugs like Ozempic have taken their toll on Weight Watchers. The company, which was endorsed by many celebrities, including Oprah Winfrey, has filed for bankruptcy. Weight Watchers recently rebranded as WW International.

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. The papal conclave to elect a new pope begins today at the Vatican. Cardinals will participate in mass with the public before secluding themselves for possibly days of voting. Pope Francis had been considered comparatively progressive in his views on migrants, the LGBTQ community, climate change, and more. Monsignor Liam Burgett.

Everybody involved in the conclave takes an oath of secrecy. Everybody. And they are bound by what's called the apostolic secret. So if you betray the apostolic secret, if you break it, excommunication is the penalty. A CBS poll of U.S. Catholics find a majority want Francis' successor to continue his teachings or move in a more progressive direction, while 37% want the next pope to be more conservative.

There have been long lines at DMV offices around the country. Starting today, travelers flying domestically will be required to have a real ID license or a state identification card or passport. For those who don't, they will face extra screening and questioning at the security checkpoint. There is mixed passenger reaction at Newark. People have had plenty of time to get prepared for it. I've had it for five years at least, so...

back when they first started talking about it. It feels like a tax on everyday people, having to upgrade their licenses and all of their identification. In New York City, jury selection in the sex trafficking trial of hip-hop mogul Sean Diddy Combs is expected to wrap up today. Lawyers for the 55-year-old entertainer and prosecutors have worked for two days to assemble 35 individuals for a pool of 45 people from whom the jury will be picked.

Global news 24 hours a day and whenever 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...

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Time now for the Bloomberg Sports Update. Here's John Stashower. John, good morning. Good morning, Karen. There's been a lot of heartbreak over the years in Cleveland. Their teams have won one championship in the last 77 years. High hopes with the Cavaliers. Had a brilliant 64-win regular season, but they're in big trouble. In the second round, lost the opener.

Had to play game two without three key injured players. Still had a 20-point lead on Indiana. Cavs were up by seven with 50 seconds to go. Back came the Pacers, down two at the free throw line. Misses Halliburton, the rebound. Nine seconds. They do have a timeout. Carlisle's going to let him play. Halliburton steps back. It's Tyrese Halliburton trying to take Cleveland's heart.

hard on tnt pacers won by a point go home up to nothing in the series golden state won 99 88 at minnesota the road teams so far in the second round of the playoffs for five and oh that includes the knicks who've got game two in boston tonight sounds like christoph porzingis will play for the celtics played only 13 minutes monday due to an illness didn't score a point road teams also won on the ice paris series openers carolina topped washington 2-1 in overtime

Edmonton a 4-2 win at Vegas. The Yankees went to the seventh inning at the stadium, trailing San Diego 3-2. And then they scored 10 runs, including an Austin Wells grand slam. And the Yanks won 12-3. Mets held the four hits and a 5-1 loss at Arizona. John Stasch, 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. The U.S. and China are about to start talking after weeks of rising trade tensions and rising tariff rates. Treasury Secretary Scott Besson says both he and the U.S. trade representative will meet with Chinese officials while they all happen to be in neutral territory, Switzerland.

We will meet on Saturday and Sunday and you know look we have shared interest that the

This isn't sustainable. Treasury Secretary Scott Besson discussed these upcoming talks on Fox News. And this morning we are joined by Bloomberg News senior editor Bill Ferrys. So, Bill, after weeks of questions about whether there were talks happening, they're talking about talking about talking. I guess that's enough to give the market some reason for optimism this morning. Good morning.

Good morning. For sure, this is a fairly high-level meeting after we haven't really seen any high-level meetings between the U.S. and China so far. We still don't have any knowledge of any conversation between Donald Trump and Xi Jinping. So this does seem to show that maybe both sides have reached a bit of a pain point.

and are willing to talk. I mean, we know we've seen data on the Chinese side showing that cargo ships headed to the U.S., the number of cargo ships headed to the U.S. is down. We've seen that the trade deficit the U.S. has really ballooned

in the last report because of so many people, so many businesses trying to bring in goods ahead of those reciprocal tariffs and some of the other trade barriers that went up. So both sides with a strong incentive to talk here. It is seen on the Chinese side is important that it's the vice premier, He LeFing, who is meeting with Scott Besson and Jameson Greer. So you have

people at the table who can make decisions. And I think there's going to be a lot of interest, certainly a lot of expectations about what might come out of these two days of meetings this weekend. And ahead of those two days, Bill, we've seen the Chinese government lower its policy rate and loosen bank reserve requirements. Of course, President Trump has been talking about maybe little girls don't need as many dolls under the tree this Christmas. So what kind of

of prolonged discussion could both sides potentially be bracing for here.

Yeah, I think the you know, I don't think there's an expectation that there's going to be a huge breakthrough this weekend in terms of a major trade deal. But you certainly could have some de-escalation. And that's what Treasury Secretary Scott Besant was talking about. He says what we you know, he said what this current situation is not sustainable and a de-escalation. What is that? You know, there's some speculation that that could mean just at least trimming back.

These, you know, the 145 percent tariffs that the U.S. has on China and the 125 percent tariffs China has on the U.S. Both sides have exempted a lot of goods from those tariffs. But still, the trade is falling very quickly. And, you know, you're talking about you're talking about trade that take could take months to recover. So even if even if there was a big agreement this weekend, it would be months before you kind of make up for the shortfalls there.

that have been occurring over the past several weeks. Well, Bill, it seems like we're far from de-escalation when it comes to what's happening in South Asia after that deadly militant attack in Kashmir. There have been tit-for-tat strikes between India and Pakistan. What's the latest?

Yeah, still very tense situation. India conducted a series of military strikes just after midnight, hitting nine targets in Pakistan and in the Kashmir area. Pakistan saying 26 people were killed.

26 civilians, India saying it did not hit any civilians. Pakistan also saying that five Indian jets were shot down. I was listening to the Indian news conference about that earlier. They did not take questions and they would not address, they did not address whether any jets were shot down. So still very much a developing situation. Obviously two nuclear powers in a conflict here.

And it is seen as the biggest escalation between the two in almost six decades. So a very tense situation. It's still unfolding. We're waiting to see if Pakistan responds again to these latest strikes. 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.

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