Iran Deal Gives $300 Billion Relief; First Fed Decision for Kevin Warsh

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1:17Let's create smarter business, IBM. Bloomberg Audio Studios. Podcasts, radio, news. Good morning, I'm Nathan Hager. And I'm Karen Moscow. Here are the stories we're following today. Karen, details are still emerging as the U.S. and Iran prepare to formally sign their interim peace deal on Friday. A near final draft of the Memorandum of Understanding shows Iran is set to receive sanctions waivers that will allow it to sell oil immediately, with other financial incentives deferred. Bloomberg Middle East correspondent Abir Abu Omar has the key takeaways from the 14-point draft. First of all, an end to the war on all fronts.

2:01The U.S. will take back its troops from around the region over the next 30 days and remove the naval blockade on the Strait of Hormuz. Iran has agreed to do the same. But then perhaps some of the most sticking contention points in this MOU include what the U.S. says would be the unblocking of frozen assets for Iran. It didn't give a specified time period for that. the lifting of the oil sanctions as well. That's another point that the United States has made in this MOU. Bloomberg's Zabir Abu Omar reporting there from Dubai. President Trump says there's one key takeaway from the agreement. Iran will never have a nuclear weapon.

2:40That's what it says. It won't have one to buy, to develop. They will not have a nuclear weapon. And I would say that's about 99.9 percent of what I wanted. President Trump made those comments, as heard right here on Bloomberg Radio at the G7 meetings in France. Nathan, Democratic Massachusetts Senator Elizabeth Warren is blasting President Trump's decision to go to war in the first place. And Warren spoke on Bloomberg's balance of power. America has spent literally tens of billions of dollars halfway around the world. 14 American service members have died. Uncounted numbers of people in the Middle East have died.

3:18and Donald Trump still can't explain how one family in America is any better off. And you can catch the entire interview with Massachusetts Senator Elizabeth Warren on our new video hub available on the Bloomberg Business app and always on Bloomberg.com. All right, Karen, let's get now to the latest primary results across the country. Voters headed to polls in four states and the District of Columbia. The biggest races to watch were two runoffs in Georgia, where President Trump's endorsement led to mixed results. In the Republican Senate race, Trump-backed Congressman Mike Collins defeated former University of Tennessee football coach Derek Dooley by an 11-point margin, 55.5 to 44.5 percent.

3:57Collins says he's ready for the fight ahead in November. And y 'all know what the mission is, is to put a Republican in that seat and get rid of that John Ossoff in November. Return this seat to the people of Georgia. And Mike Collins will go on to face Democrat John Ossoff in a race that could decide control of the Senate in November. Meanwhile, Nathan, in the governor's race, President Trump's favored candidate, Lieutenant Governor Burt Jones, lost to billionaire Rick Jackson 52.7 to 47.4 percent. Tonight, you made your voice heard loud and clear. Tonight, we did more than win a runoff. Tonight, we proved the people of Georgia are in charge.

4:37And Rick Jackson spent more than$100 million of his own money at one of the most expensive primary races for governor in U.S. history. He'll face former Atlanta Mayor Keisha Lance Bottoms in the general election. Georgia Democratic Senator Raphael Wernock joined Bloomberg's David Gura and gave his thoughts on the upcoming Peach State election. It's a purple state, so you've got to convince all kinds of people to vote for you. I did it five times in Georgia in less than three years. It's doable. Of course, I'm rooting for my brother, John Ossoff, and I think he will do well against whomever they put up.

5:15I think Keisha Lance Bottoms will do well in this election. Georgia Senator Raphael Warnock. Well, Karen, it was also a historic primary night in Washington, D.C. For the first time in 36 years, Democrats picked a nominee for delegate to Congress who's not Eleanor Holmes Norton. Councilmember Robert White ran away with that nomination with 63.2 percent of the vote. The 89-year-old Norton decided not to run again after 18 terms. And they're still counting the votes in the D.C. mayor's race with 64 % of ballots counted. Janice Lewis-George leads Kenyon McDuffie 52.8 % to 36.6%. The race will move to additional rounds of counting if no one wins more than 50 % of that vote.

5:54Lewis-George is a self-described Democratic socialist. And President Trump's threatened a new federal takeover of the district if she wins the mayor's race. Well, and some other key races to watch. Nathan, Trump-backed Congressman Barry Moore won the Republican runoff for Alabama's open Senate seat with 55.8 percent of the vote. He defeated former Navy SEAL Jared Hudson and will face Democrat Everett West. He won the Democratic primary with 54.6 percent. In California, Democratic State Senator Ayesha Wahab has advanced to a runoff in the special election for former Congressman Eric Swalwell's open House seat with 82 percent of votes counted.

6:30Wahab is 42.4 percent. The runoff to fill the remainder of Swalwell's term will be held on August 18th. And in Oklahoma, Karen, Trump-backed Republican Kevin Hearn ran away with the nomination for the Senate seat left open by Homeland Security Secretary Mark Wayne Mullen with 69.8 percent of the vote. Hearn will face whoever wins a Democratic runoff between Nikaila Jasmine Thomas and Jim Priest. Meanwhile, the Republican governor's race in Oklahoma is headed for a runoff of its own. Gettner Drummond has 26.3 percent of the vote, while President Trump's favored candidate, Mike Mazie, has 26 percent.

7:05The winner will face statehouse minority leader Cindy Munson in November. Let's turn to the economy now, Nathan. The Federal Reserve makes its first policy decision under new chairman Kevin Warsh. No change in policy is expected, and Bloomberg's Michael McKee has a preview. Investors know the plot today. They're waiting to see how the new leading man performs. Do we see Kevin Warsh's influence in today's communications, and how does he handle the news conference? The central bankers aren't going to change interest rates, and they'll make minor tweaks to their economic forecasts. Expect the statement's easing bias to disappear, although a number of other Fed officials were already pushing for that.

7:44Look to the dot plot, though. It's forecast to show no rate cuts in 2026 anymore. But even more interesting will be whether Warsh, a dot plot critic, submits a dot. and then how he explains not only that, but what he wants to do in terms of communications and Fed operations. Above all, Global Wall Street wants to know what he'll have to say about President Trump's influence on him and his policy views. Michael McKee, Bloomberg Radio. Once again, a stock to watch in the pre-market, Karen, is SpaceX. Those shares are on the rise once again, right now up 3.5 % in early trading. Elon Musk's company has now overtaken Amazon to become the fifth largest in the world.

8:25The story from Bloomberg's Charlie Pellett. SpaceX was up for a third day with its post-IPO rally reaching 49%. Walter Todd is president of Greenwood Capital. SpaceX, to me, with the IPO on Friday, is kind of the culmination of this just massive market rally that we've had, particularly in technology and the semiconductors. And now SpaceX, over a three-day period, adding roughly another trillion dollars to the market cap. SpaceX now has a market value of$2.65 trillion, roughly$8 billion higher than Amazon. In New York, Charlie Pellett, Bloomberg Radio.

9:04Time 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 John Tucker. John, good morning. And good morning, Karen. Authorities say the FBI disrupted a plot targeting the UFC event at the White House this past weekend. Five people are now in custody. Here's Secret Service Deputy Director Matt Quinn. I'd say it was unique due to the numbers involved, the level of planning involved. Thankfully, our Advanced Threat Interdiction Unit got on top of it very early. Officials say multiple suspects in multiple states were involved.

9:38The U.S. has emptied the immigration detention camp in the Florida Everglades known as Alligator Alcatraz. The state of Florida spent hundreds of millions of dollars on a high-profile facility to support President Trump's mass deportation agenda. In Albania, demonstrators continue their third week of the Flamingo Revolution protests.

10:01It was initially a protest against a planned luxury development on an environmentally sensitive stretch of coastline tied to President Trump's son-in-law, Jared Kushner. It's now expanded to include calls for the country's prime minister to resign. And finally, the ratings are in. Bedlam here at the Garden. They can't believe it. The Knicks' victory over the Spurs drew a massive audience of 20.6 million viewers per game for the finals. It was the most watched NBA Finals since 1998. Viewership more than doubled compared to last year. Global News 24 hours a day, whenever you want it with Bloomberg News Now.

10:39I'm John Tucker. This is Bloomberg. Thanks, John. Time now for our Bloomberg Sports Update. And for that, we bring in John Stashauer. Thanks, Karen. The day after all four World Cup games ended in ties, All four were rather one-sided with the Stars leading the way. France, a 3-1 win over Senegal with Kylian Mbappe scoring twice. Norway, a 4-1 round of Iraq. The Norwegian Stars, Erling Howling, he scored twice. Lionel Messi had the hat trick in Argentina's 3-0 win over Algeria. John Tortorella coached the Vegas Golden Knights to the Stanley Cup final, but the team announced he won't return next season.

11:16That's your Bloomberg Sports Update. Stay with us. More from Bloomberg Daybreak coming up after this. The thing about AI for business, it may not automatically fit the way your business works. At IBM, we've seen this firsthand. But by embedding AI across HR, IT, and procurement processes, we've reduced costs by millions, slash repetitive tasks, and freed thousands of hours for strategic work. Now we're helping companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business, IBM. As a restaurant genius, I know the experience starts long before the food hits the table.

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13:39Coast 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. As the U.S. and Iran get closer to signing their interim peace deal at the end of this week, more details are emerging about the financial incentives Tehran could be in line for to reopen the Strait of Hormuz. President Trump says it won't include U.S. money. We are not investing any money. We have no obligation to invest any money in Iran. Well, that was President Trump alongside Qatar's Amir at the G7 summit in France yesterday.

14:13Joining us from the gathering this morning in Evian is Bloomberg Washington correspondent Tyler Kendall. And of course, Tyler, we've obtained a draft copy of the 14-point plan to get the straight reopened. Tell us more about the financial incentives and how significant they could be. Good morning. Hey, Nathan. Good morning. Well, under this draft deal, themed by Bloomberg News, which isn't final yet, but is believed to be in the final stages, Iran would basically be able to immediately sell its oil to market after the deal is signed. It outlines that the Treasury Department will issue waivers for those sanctions on Iranian crude that have been in place.

14:51Now, the U.S. has been saying that any such financial relief would be conditioned, that benefits would accrue over time based off of Iran's performance related to this deal if it takes those steps to reopen the strait, if it takes steps to curb its nuclear program. But this does appear to be an immediate financial benefit that Iran can reap. The other financial benefit, as you heard and mentioned earlier, was that we're expecting this deal will include a$300 billion, what's being called a development fund, with the financing being provided by the U.S. and Gulf allies in a bid to help Iran rebuild.

15:30We're still waiting for some more clarity on that, but some significant financial benefits, but this is being viewed as perhaps a carrot more than a stick to try to get Iran to make some significant concessions when it comes to its nuclear program and what is expected to be a second phase of negotiations. Tyler, do we have a sense of how G7 allies could take this agreement? And I know how you talk to lawmakers in Washington on a daily basis. How is it likely to be received in the nation's capital as well? That's a good question. It's going to depend on which lawmakers we're talking about at this point.

16:07Many Republicans, by and large, say that they're in favor of the president reaching a diplomatic solution because they can get this so that they can get the Strait of Hormuz opened. And they're banking on the U.S. being able to get some pretty significant concessions related to Iran's nuclear program. The U.S. has repeatedly said that any finalized deal must include the retrieval of Iran's highly enriched uranium, a moratorium on future enrichment, and also a stringent inspections regime. They're all very much in favor of that. But I think you'll start to hear some skepticism from some of those more hawkish members.

16:44President Trump yesterday alluded to one of them saying that he has to talk to Senator Lindsey Graham, who has been very outspoken in pushing the president to perhaps take even more military action because he feels perhaps that could help get more concessions out of Iran. Here on the ground at the G7, there's been a lot of questions, I think it's fair to say, from leaders on exactly how this deal is going to work, in particular when it comes to the Strait of Hormuz. I caught up yesterday with the spokesperson for France's foreign ministry, a very high-ranking official here at the summit, as France is leading this summit.

17:18And he told me that until our allies see the finalized text, they get the information from the U.S. on exactly how this is going to be implemented. They're not going to be willing to deploy some really critical military assets, including minesweepers, that are going to be essential to reopening the Strait of Hormuz. Really appreciate this, Tyler. As always, Bloomberg Washington correspondent Tyler Kendall, part of our team covering the G7 leader summit in Evian, France. Karen. Nathan, let's repeat some of our top stories. Trump-backed Republican Mike Collins defeated Derek Dooley in the runoff election for Senate in Georgia.

17:54Collins will face Democrat John Ossoff in November. President Trump's favored candidate for Governor Burt Jones lost to billionaire Rick Jackson. The Fed is expected to hold rates steady in its first policy decision under new chair Kevin Warsh. It'll be an early test as rising inflation erodes Americans' purchasing power while President Trump pushes for lower borrowing costs. And SpaceX headed for a fourth day of gains after passing Amazon as the fifth largest publicly traded company in the world. Elon Musk's rocket AI company is now about $150 billion away from overtaking Microsoft's market value.

18:29More on those stories coming up. 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.

19:07It'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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