Trump Waits For Iran Response, US-EU Trade Deal Stumbles Again

Bloomberg Audio Studios, Podcasts, Radio News.
Good morning, I'm Nathan Hager and I'm Alexis Christophers.
Here are the stories we're following today, Alexis.
The seasfire between the US and Iran has reached the
one month mark, and this morning, both sides are circling
around a new proposal to end their nearly ten week war.
The way President Trump puts it, he already has the.
Leaders are all dead, So I think we won.
The President spoke from the Oval Office as Iran reviews
a one page memorandum of understanding on stopping the conflict.
They want to make a deal badly, and we'll see
if we get there. If we get there, they can't
have nuclear weapons. You know, it's very.
Simple, President Trump at the Oval Office.
Bloomberg Middle East correspondent Jamana Borsecci reports the one page
proposal would be a first step if both sides agree.
It would include an immediate end to hostilities, and then
a thirty day period in which negotiations would begin surrounding
the lifting of the mutual blockades around the streets, reopening
of that nuclear file, discussions around the timeframe of uranium enrichment,
and then also handing over the fate of that highly.
Enriched uranium soft file.
Of course, we know that they're sitting on more than
four hundred kilos worth of sixty percent plus highly enriched uranium.
So that is a big topic, that was even a
topic before the war kicked off.
Bloombergs Jumana Burssetti reports Iron would be looking for significant
sanctions relief in exchange for all that. There may be
urgency at the White House to get a deal done.
President Trump has a summit next week in Beijing with
Chinese President Shi Jinping, and gasoline prices have topped four
fifty a gallon for the first time in nearly four years.
Nathan, the Israeli Army has carried out an attack in
the southern suburbs of Beirut. The military says the precision
strike killed Ahmed Ali Balut, the commander of Hesbola's elite
Radwan force. This was the first Israeli strike in the
vicinity of Lebanon's capital since the US broker ceasefire came
into effect last month. Iran has previously threatened to withdraw
from it cease fire with the US if Israel keeps
up attacks in Lebanon, Alexis.
There's a more proof this morning on how the conflict
in the Middle East is affecting the airlines industry.
Bloomberg's Lisa Matteo has the details.
New data from the US Department of Transportations Bureau of
Transportation Statistics shows fuel costs for US airlines increased by
more than fifty six percent in March from the month before.
Oil consumption also grew by nineteen and a half percent
from February to March, and fuel cost per gallon was
up almost thirty one percent. The costs were also significantly
higher when compared to March of last year. Spiking fuel
prices have pushed carriers to increase fares and baggage fees,
as well as cut back on routes. It was also
a major factor in the closure of Spirit Aviation.
Lisa Mateo, Bloomberg Radio, Thanks Lisa and elsewhere this morning.
Secretary of State Marco Rubio is in Italy, where he's
meeting Popelo the fourteenth. The gathering comes amid continued attacks
by President Trump and and the head of the Catholic Church.
Bloomberg's Flavior Ro Tondi has more from Rome.
Rubio said in the last few days that district to
Rome and the Vatican has been planned months ago before
the tensions between President Donald Trump and Leo. Said that
the visit was part of a regular engagement with the
only See. But of course the decision to come to
Rome these days is here in Italy prompted speculation that Rubio,
who is Catholic, as you know, what's going on a
sort of a mission to repay relations. I would say
strange by Trumps back and forth with the Pope and
Italian Prime Minister Georgia Meloni in the last few weeks.
Bloomberg's Flavio ro Tondi in Rome says that Rubio's focus
of the chap will be shared interests with the Vatican,
including humanitarian aid in Cuba and religious freedom in Africa.
Now Like says trade tensions could overshadow Rubio's trip to
Europe as well. The European Union has failed to finalize
a long delayed US trade deal during overnight talks. That's
despite warnings from President Trump that he would soon impost
fresh tariffs on the block. We get more from Bloomberg
Chief Europe correspondent Oliver Crook.
Well, you had last night was the meeting of the Trilog.
This is the sort of synonym for reconciliation, the discussions
that happen at the European level to try to get
this now new amended trade deal across It did not
make a sort of a big breakthrough, the sort of
swift resolution that Trump wanted. But we did hear from
the EPP party, this is the biggest party in European Parliament.
That basically the final rounds of negotiations with EU member
states and the European Commission and will be scheduled for
the nineteenth of May, with the European Parliament's final vote
expected in June. Now, there are two scenarios here. One
they get this through, the US is happy. The second
is you start to get these US auto tariffs, you
go back to square one. We don't think that's likely, because,
of course, the Europeans didn't want to deal with the
trade word to begin with much less now when there's
this issue of stragflation sort of hanging over the economy.
Here Bloomberg's Oliver Crooks.
As President Trump threatened last week to increase tariffs on
EU cars and trucks from fifteen to twenty five percent
and back here.
In the US Commerce Secretary Howard Lutnick testified to the
House committee investigating Jeffrey Epstein's crimes and possible lapses in
the law enforcement response. Bloomberg's Amy Morris reports from Washington.
Secretary of Lutnick's testimony was challenged by Democrats, who questioned
his credibility and accused him of not being truthful about
his visit to Epstein's island. Ranking member of the House
Select Committee Rocanna, it was.
Just contortions and lies and no acknowledgment that he misled.
The American Public.
House Oversight Chair James Comer says Lutnick was transparent, testifying
before the committee voluntarily.
The only thing that I'd seen that Lutnick did wrong
wasn't truthful on the brief visit to the island with
his family.
He corrected that.
It was a closed door testimony. The committee plans to
release a transcript in the next few days. In Washington,
Amy Morris Bloomberg Radio.
Amy Thanks. On the day of that testimony. Some long
concealed evidence in the Epstein case has been released. A
federal judge is unsealed and purported at Sue side note
that Epstein's former cellmate says he found tucked in a
graphic novel and the late Sex Offenders Manhattan jail ceuth.
The New York Times asked for this note to be released.
Federal prosecutors did not object. It reads, in part, they
investigated me for month, found nothing. It goes on to
say it is a treat to be able to choose
the time to say goodbye.
Now.
The existence of this note was little known until last year,
when Epstein's former cell mate mentioned it in a podcast interview.
It was not mentioned in the Justice departments millions of
Epstein files.
We turn now to the markets, where futures are higher.
After another record setting session on Wall Street, the S
and P five hundred rows one and a half percent
chipstocks helped the Nasdaq to a two percent rally. Lorie
Calvacina is head of you as equity strategy at RBC
Capital Markets.
It really is the strength of the AI related earning
story that is driving this market. That's why we do
think people will continue to sort of follow the earnings
and follow.
That big cap growth trade.
But it's very hard to get barish on the market
when you do the bottom up analysis. No matter how
you feel about the geopolitics.
RBC's Lori Calvacina notes the Philadelphia Semiconductor Index also ended
the day at an all time high. In Asia overdight,
Japan's and EKE surging more than five percent to an
all time high, and checking oil this morning after yesterday
seven percent drop, Brent Krude the international benchmark down two
percent at ninety nine dollars a barrel. Time now for
a look at some of the other stories making news
in New York and around the world. For that, we're
joined by Bloomberg's Michael bar Good morning, Michael, Good morning.
Alexis health officials are trying to control a deadly outbreak
of handavirus, the first ever recorded on a cruise ship.
Three people have died, and the World Health Organization says
there are eight cases. Dutch officials say about forty passengers
from the cruise ship have disembarked on Saint Helena, but
their whereabouts have not been confirmed. The ship right now
is on its way to Spain's Canary Islands, but the
point of infection may have been Argentina. Doctor Ann Lindstrand
of the World Health Organizations says the close quarters on
cruise ships makes them vulnerable to outbreaks.
It's an incubation time of about.
One to eight weeks where this symptoms started out.
I think it's like flu like symptoms.
You have pain, muscle pain, seever, feeding week, etc.
Health authorities say nobody currently on the ship is symptomatic
for now. There's mounting pressure on state lawmakers to back
redistricting of congressional maps ahead of midterm elections. In South Carolina,
Republican state Representative Jordan Pace talked about the renewed fight
over redistricting in the Palmetto State.
I don't believe, and I don't think most people believe
that people vote best on their skin color and never have,
so I would like the map to be reflective more
of political alignment rather than any any racial components to it.
Republican lawmakers in Tennessee are poised to vote on a
plan to reshape a majority black congressional district. The move
is part of a broader strategy in southern states following
a US Supreme Court ruling that weakened the Voting Rights Act.
Democrats and civil rights activists have criticized the efforts. Rudy
Giuliani was moved out of the intensive care unit and
remains hospitalized as he continues his recovery. Juliani spokesperson Ted
Goodman says the former New York mayor is recovering from
pneumonia after complications from a pre existing respiratory condition. Global
News twenty four hours a day and whenever you want
it with Bloomberg News Now. I'm Michael Barr, and this
is Bloomberg Alexis.
Thanks Michael. Time now for our Bloomberg Sports update, and
for that we bring in John stash Houer.
Both teams one of the NBA playoffs that inclosed, the Knicks,
who's been blowing teams out. This one was much closer
in New York with the knicksbeat Philadelphia one o eight,
one oh two. They lead the series to nothing. It
was not close. In San Antonio, the Spurs one by
thirty eight over Minnesota the series title one. Stanley Cup Playoffs.
Buffalo won Game one with Montreal four to two. Anaheim
won Game two at Vegas three to one. Golden Tempo.
That thrilling one at the Kentucky Derby will not be
in the preak this they will be in the Belmont Sticks.
That's your Bloomberg Sports Update.
Stay with us. More from Bloomberg Daybreak coming up after this.
Coast to coast on Bloomberg Radio, nationwide on Sirius Exam,
and around the world on Bloomberg dot Com and the
Bloomberg Business app. This is Bloomberg Daybreak.
Good morning, I'm Nathan Hager.
Optimism is building in the market that the US and
Iran might be able to find a way out of
nearly ten weeks of war. This morning, Iran is said
to be reviewing a one page memo of understanding from
the US. President Trump says he has a clear bottom line.
Iran cannot have a nuclear weapon because as tough as
they are, we want to keep them alive. We want
to keep all of you alive. Iran cannot have a
nuclear weapon.
And that was President Trump speaking from the Oval Office.
Joining us this morning from Dubai is Jumana Bursecchi, the
Bloomberg Middle East correspondent and anchor of Bloomberg Horizons. Jamana,
from what we understand about this memo, the nuclear weapon
issue waits till later, right, Good morning.
Yeah, good morning.
So from what we do understand, it is a memo,
It's just one page and it would entail an immediate
end to the war and then a thirty day period
in which negotiations would start around, as you mentioned, the
nuclear file in exchange for the US lifting sanctions and
unfreezing some Iranian assets. Now, again that is a toll
order to solve all of those issues, including the mutual
lifting oblockades around the Strait over a period of thirty days.
Just to give you some context, you know, jcp Away,
it took eighteen months. Prior discussions with Iran around anything
to do with nuclear has taken anything from months to years,
So a little bit I would say ambitious in terms
of timing. And then also we're sort of back to
where we were before the war even started in terms
of what the US are pushing for in these discussions
versus what Iran are willing to concede to. And here
the same points to do with uranium enrichment, what level,
zero level enrichment, low level enrichment, the timeframe of suspension,
and then the fate of that highly enriched uranium stockpile.
It's still unclear at this point whether Iran is willing
to forsake that or give that up and on what terms.
They're willing to do so.
However, what I will say is the reason the market
is reacting so positively beyond the expectation that we may
get some form of a resolution to this war, is
that at the beginning of the week we look like
we were on the brink of another round of hostilities.
We've walked away from that now and it seems like
diplomacy is back on the table.
So while we wait for Iran's response, Jumana, what could
that potential response be now that we have this situation
in the strait of horror moves where things are at
the near stand still, and you could argue that Iran
does have some leverage there in terms of trying to
enact a tolling set them to get shipping through.
That's exactly it.
So, you know, we've spoken to many people over the
course of this morning, especially people who are involved in
oil markets, and there is despite the knee jerk reaction,
there's some skepticism about how quickly we will likely see
the lifting of the blockade. And if it is true
that this is going to be a thirty day period
of negotiations, let's not forget.
That the straight if we're still closed.
Over that thirty day periods, you're talking about another four
hundred and fifty million barrels a day of oil that
will still be taken off the market. That's per RBC calculation.
So it's probably a little too soon to talk about
a full free flowing of vessels through the strait, and
it is a key point of leverage that Iran continue
to hold onto, and they know that they're holding onto
this at the same time, they're trying to establish a
new protocol.
Overnight.
They've put together what they're calling the Persian Gulf Straight Authority,
which is a new authority that they set up. Acquiring
vessels to submit a request in which they then would
be required to fill in a form including all sorts
of data, what cargo they have on boards, how many
the nationalities of the crew members and so forth, after
which they then would get a yes or no in
terms of their ability to transit the vessel.
So this is a protocol that Irana trying to set up.
From our own reporting, we understand that ship owners are
very unlikely to subscribe to it, in which case you're
still left in an impasse.
Very few vessels are passing through, and of.
Course This memo of understanding is coming ahead of a
key summit for President Trump in Beijing with Chinese President
Shi Jinping. There's been a lot of pressure as well
on the US side to get China to exert its
leverage over Iran. Is that having any impact from where
you sit in Dubai.
I think it certainly is.
And you also need to bear in mind that the
erin in Foreign Minister OurBus I actually was in Beijing yesterday.
He met with his counterpart there at China once again
pushing for a diplomatic resolution to this, and obviously they
have a vested interest in it too. Economically, they import
the lion's share of Iranian oil. That's talking about ninety
percent of Iranian oil ending up in Chinese hands. So
from their perspective, clearly they want to see things return
back to normal, but also perhaps sense the geopolitical opportunity
here to gain a one up versus the US, which
is in a situation where you know, it's very tricky
for President Trump back home, He's on a shorter time frame,
shorter timeline and the Iranians calculation is the longer this
drags on for the more the economic costs are going
to build up not just for the US but for
the rest of the world.
And so here it really is to do with, you.
Know, managing a timeline that actually works out for all
parties involved. And what we are sensing from the region
and these from countries like Saudi Arabia is they too
are pushing for a diplomatic resolution to the Nobody wants
to see the full return to hostilities.
But the question is how you.
Infect paper over those huge differences in the respective stances
of what the US wants to see out of Iran
on the nuclear file versus what Iran are willing to offer.
This is Bloomberg Daybreak, your morning podcast on the stories
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