Iran Says Hormuz Talks Underway, Stocks Rise as Oil Plunge

0:00Bloomberg Daybreak U.S. edition is brought to you by OTC Markets Group. OTC Markets' overnight platform for exchange-listed securities, Moon ATS, provides access to global securities in U.S. dollars from 8 p.m. to 4 a.m. Eastern, Sunday through Thursday. Learn more at otcmarkets.com slash moon. Moon ATS is operated by OTC Link LLC, a FINRA-registered broker-dealer, and is available only through participating broker-dealers. Everyone's talking about how AI is transforming work, especially in sales. While the landscape shifts, one thing remains the same, the thrill of closing a deal. Whether it's a gong or a confetti machine, every team has its celebration rituals.

0:39Adio is designed for that moment. It's the agentic CRM that turns customer signals into actionable insights, helping you close deals faster with revenue agents and automations working around the clock. You'll have everything you need to scale your go-to market efforts. Elevate your wins with Adio. Start your free trial at adio.com slash iHeart. Amazon Health AI presents Painful Thoughts Why did I search the internet for answers to my cold sore problem? Now I'm stuck down a rabbit hole filled with images of alarmingly graphic sores in various stages of ooze I can clear my search history but I can never unsee that Don't go down the rabbit hole Amazon Health AI gets you the right care fast Health care just got less painful.

1:31Bloomberg Audio Studios. Podcasts. Radio. News. Good morning. I'm Karen Moscow. And I'm John Tucker. Here are the stories we're following today. John, we begin with new developments in the Middle East. President Trump says talks with Iran will begin this afternoon after he called off a planned attack on Iran. The president says he stepped back from the latest attacks following appeals from Saudi Arabia and other U.S. allies in the region. And here's what he told reporters yesterday on board Air Force One. We're talking to them in the form of a negotiation. It begins tomorrow afternoon and we'll see if it's true.

2:09I'd love to do that. Save a lot of lives. Save a lot of unnecessary power, to be honest with you. It would take many, many years to ever build it back. I don't think it would be even buildable back. So we had an attack that would be the biggest attack since World War II. And President Trump suggested a deal on reopening the Strait of Hormuz may be close. We get more from Bloomberg opinion columnist Mark Champion. He needs a deal, but he needs a deal that looks like a win for him. And that's going to be hard because at the moment, all that's being discussed is the status of the Strait of Hormuz, which was open before the war and is only an issue now as a result of the war.

2:49It's not exactly a victory if you end up with an outcome where none of the things that you said you were going to a war have been dealt with, such as the nuclear program. But you have got a deal to reopen the Strait of Hormuz that gives Iran control that it didn't have before the war. Bloomberg Opinion columnist Mark Champion this morning. An Iranian foreign ministry spokesman says Iran currently has no negotiations with the U.S. And Karen, in Washington, the acting attorney, General Todd Blanche, says he is formally rescinding an order creating an anti-weaponization fund. Let's get details from Bloomberg's Monica Ricks.

3:26Acting attorney, General Todd Blanche, has issued a formal announcement scrapping an anti-weaponization fund that could have paid$1.8 billion to President Trump's allies, including January 6 rioters. And he further clarified the scope of the president's sweeping immunity deal with the IRS. That move could now potentially clear the way for his confirmation as attorney general. A Senate judiciary vote's been rescheduled for tomorrow after Blanche reached an agreement with Senator John Cornyn, who'd been a holdout, insisting Blanche get rid of that fund permanently. Monica Ricks, Bloomberg Radio.

4:00All right, Monica, thank you. Well, key senators have unveiled a short-term spending bill to avoid a government shutdown during the middle of campaign season. The bill would keep federal agencies funded past the midterm elections through December 11. The Senate is likely to vote on the measure before leaving Washington at the end of the week for its traditional August recess. By extending government funding now, lawmakers can use the ensuing months to work out their differences on funding for the full year. And let's turn to the markets where futures are higher as we begin a new trading month.

4:30This year's favorites, the chip stocks, coming off a pretty rough July. The Philadelphia Stock Exchange Semiconductor Index, the stocks, plunged 21%. That was its worst month in 18 years. And today in South Korea, the Cosby Index, that's a bellwether for AI investments, fell more than 5 % after surging a record 18 % on Friday. John, the U.S. has rushed to the aid of Japan to help prop up their ailing currency, its first joint action intervention on the yen in 15 years. And Treasury Secretary Scott Besson posted on X both the U.S. and Japan will not hesitate to intervene again. Japan's finance minister, Satsuki Karayama, backed that statement up when she spoke to reporters this morning in Tokyo.

5:14We will not hesitate to conduct further joint intervention. The Japanese Ministry of Finance and the U.S. Treasury will take decisive actions if any disorderly movements are detected, and those actions will be implemented. I am telling you that we are prepared to take actions at all times. And Japan's finance minister, speaking through an interpreter, The rare coordinated intervention comes as the yen has been hovering around multi-decade lows. Following the intervention, the yen is strengthening. It's up three-tenths of a percent this morning against the dollar at 156.96. And on the economic Friday in the U.S., investors are going to be looking ahead to Friday.

5:53That's when we get the jobs report for the month of July. And let's get a preview now from Bloomberg's Michael McKee. Investors' bets on a rate increase next month hang on a strong enough economy to absorb an increase in the cost of borrowing. The Fed's first measure of that is the July jobs report out Friday. The labor market scorecard is likely to be acceptable. Most economists haven't formalized their forecasts yet, and the employment readings in this week's ISM manufacturing and services reports and Wednesday's ADP survey may lead some to make adjustments. Going into the week, however, the consensus is for little change in hiring, something just short of 100 ,000 or so, unemployment is expected to be unchanged at 4.2%.

6:36Those kinds of numbers would reassure the central bank not guaranteeing a rate move, but making one possible. Michael McKee, Bloomberg Radio. All right, Michael, thank you. We have word this morning of a possible transatlantic mega deal in the drug-making industry. We get more with Bloomberg's Charlie Pellett. Sources tell Bloomberg the UK's AstraZeneca has explored an acquisition of Bristol Myers Squibb, which is based in New Jersey. It's a potential mega deal that would create one of the world's largest drug makers. Bloomberg News says the companies have held early stage discussions about combining, but it's unclear if those discussions are ongoing.

7:13Bristol Myers Squibb has a market cap of$133.4 billion. AstraZeneca has a value of 195.9 billion pounds, or about$133 billion. In New York, Charlie Pellett, Bloomberg Radio. All right, Charlie, thank you. Early trading shares of AstraZeneca, they're down about 6%, while Bristol-Myers squibbed those shares. They're up 8.7%. And let's get an update on Europe's wildfire season. In Greece, deadly fires west of Athens are mainly under control this morning. About 500 firefighters tackled that blaze. It's burned more than 24 ,000 acres. A heat wave has eased in southwest France, helping firefighters to contain blazes near Bordeaux.

7:57Fire activity has also eased in Spain, while U.K. firefighters have been working to control a wildfire in southeastern England. Now, meteorologists warn the weather patterns support weeks of hot, dry conditions. A dangerous fire season may linger well into the fall. And we have a programming note here, John. Bloomberg Radio is introducing a new feature exclusively for Bloomberg.com subscribers and terminal clients. You can help shape our conversations by submitting questions for our analysts and experts to answer live on air. Subscribers can go to Bloomberg.com slash ask radio to send in questions, and you may just hear them asked on the air.

8:34That's Bloomberg.com slash ask radio. Thanks, Karen. That brings us to 508 on Wall Street. Time 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 Barr. Good morning, John. We have devastating wildfires in the U.S. as well. In eastern Washington state, authorities say wildfires forced the evacuation of 60 ,000 people in the Spokane area, including patients at its U.S. Veterans Affairs Hospital. The fires have destroyed at least 600 homes, businesses, and other structures. U.S. Senator Maria Catwell was at the scene of one burned-out neighborhood.

9:15We now know that there are thousands of Washingtonians in Spokane area that had to be evacuated. We know there are hundreds of homes that have been destroyed. The fires have burned more than 8.2 square miles. They've been among dozens of fires across the western U.S. No deaths have yet been reported from the fires in the Spokane area. Republican Ohio Senator Bernie Moreno called on his ex-son-in-law, Ohio Representative Max Miller, to resign in the U.S. House amid allegations of physical violence against Miller's former wife and daughter. On social media, Miller denied the allegations. Miller also says that he will remain in the race and win in November.

9:56Every one of these allegations traces back to a single source, my former wife. I filed for divorce in August of 2024. That October, she admitted under oath that I had never harmed our daughter. As for the allegations against Miller, President Trump said he would look at it, saying, so far, it's accusations. A flight attendant strike at Canada's second largest airline could impact the U.S. WestJet Airlines serves more than a dozen U.S. states. Bargaining committee member Cameron Jones says they went on strike Sunday following failed talks. The goal is that we're expecting the federal government to protect our right to strike and allow bargaining to happen at the bargaining table as it's designed to do under the Canada Labor Code.

10:46One big stumbling block. The union says WestJet uses one method to pay flight attendants when the aircraft is in motion and another to compensate for groundwork. Flight attendants argue the system is unfair, saying it results in as many as 35 hours a month of unpaid work. Global News, 24 hours a day and whenever you want it. With Bloomberg News Now, I'm Michael Barr and this is Bloomberg. Thanks, Michael. Time now for our Bloomberg Sports Update. And for that, we bring in John Stashauer. Hottest team in baseball continues to be the Boston Red Sox, 23-3 since July 3rd. finished a shocking sweep of the Dodgers in LA.

11:26The Red Sox hit four solo home runs and won eight to four. Baseball trade deadline six Eastern today. Veteran Kevin Gossman just got traded by Toronto to the Cubs. The Mets traded pitcher Freddy Peralta to Tampa Bay and the Washington Nationals traded slugging first baseman Luis Garcia Jr. to the Yankees. That's your Bloomberg Sports Update. Stay with us. More from Bloomberg Daybreak coming up after this. Bloomberg Daybreak U.S. edition is brought to you by OTC Markets Group. Thinking about joining the exploding overnight market space, but unsure where to start? Designed to meet the needs of a growing international investor base, OTC Markets' overnight platform for exchange-listed securities, Moon ATS, provides access to global securities in U.S.

12:11dollars from 8 p.m. to 4 a.m. Eastern, Sunday through Thursday. Extend your trading day and trade global securities in U.S. dollars through a FINRA-licensed broker-dealer. In the first half of 2026, over$28.1 billion U.S. dollars traded on Moon ATS. Learn more about Moon ATS. Visit otcmarkets.com slash moon. Moon ATS is operated by OTC Link LLC, a FINRA-registered broker-dealer. Everyone's talking about how AI is transforming work, especially in sales. While the landscape shifts, one thing remains the same, the thrill of closing a deal. Whether it's a gong or a confetti machine, every team has its celebration rituals.

12:50Adio is designed for that moment. It's the agentic CRM that turns customer signals into actionable insights, helping you close deals faster with revenue agents and automations working around the clock. You'll have everything you need to scale your go-to market efforts. Elevate your wins with Adio. Start your free trial at adio.com slash iHeart. Amazon Health AI presents Painful Thoughts. I, um, I can't stop scratching my downtown. Yeah, but I'm not itching to go downtown and tell a receptionist I'm here to talk about my downtown. Some things you'd rather type than say out loud. There's no question too embarrassing for Amazon Health AI.

13:32Chat your symptoms and get virtual care 24-7. Healthcare just got less painful.

13:41Coast 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. And good morning. I'm Karen Moscow alongside John Tucker. And President Trump said new Iran talks should begin this afternoon, this after he called off a planned attack on Iran, partially in response to pleas from U.S. allies in the Middle East, including Saudi Arabia. We had an attack that would be the biggest attack since World War II. And Trump suggested a deal on reopening the Strait of Hormuz may be close. Meanwhile, an Iran foreign minister spokesman said Iran is currently not negotiating with the U.S.

14:21And for more on all this, we're joined by Patrick Sykes, Bloomberg News Middle East breaking news editor. Patrick, good morning. Patrick, get us up to date on the latest here, please. Yeah, the latest just an hour or so ago, we had the Iranian foreign ministry spokesman pushing back on that statement from Trump. Iran is basically trying to distinguish between two sets of talks. saying we are indeed speaking with the Omanis about the Strait of Hormuz and what safe passage might look like in future. But we are not currently negotiating with the U.S. in the kind of format that we saw to end the war.

14:59That being said, I think the fact that there is clearly some diplomatic momentum in that Omani track is a positive. and it could be that that is what sort of unlocks the much thornier, the bigger macro dialogue between Tehran and Washington because as we know since the ceasefire unraveled, it's really been the status of that waterway, safety, what navigation, what governance will look like after the war. That's been the sticking point the whole way through. So if Iran and Oman are able to reach some kind of bilateral understanding on that, The hope is that that will then ease things up for the bigger talks with the U.S.

15:42And there's different reports on what directions they might be going on when it comes to these talks about the Strait of Hormuz. So is there any idea of which idea is coming out as the one that might get an agreement? It sounds oddly like something like the status quo before the war in terms of navigation, i.e. not using, i.e. using a sort of middle route between the Armani and the Iranian coasts. That was the case before the war. Obviously, since the war, we had Iran insisting that ships go close to its shore through a northern route and Arman later trying to arrange a southern route. That being said, while the ships might return to navigating something like the same corridor that they did before, That's not to say that the governance of those transits will be the same.

16:36It still does look like very much that Iran is insisting on a roll, on a sort of veto power over ships and their right of passage in the future governance setup. So it's not to say that it will be free navigation as we knew it before February the 28th. And just quickly, what do we know about these talks this afternoon that President Trump is speaking about? Do we know anything about them and who's taking part? No, and Iran was very keen to say this morning that, look, the Iranian foreign minister is on a personal religious pilgrimage today. The rest of the Iranian negotiating team remain in Iran.

17:18So he's signaling that there's no trips planned to Islamabad, to Geneva, Qatar, any of those sort of mediator locations that we've seen come up in the course of the war. It may simply be that Trump is referring to a phone call, a exchange of messages of the kind that we've seen has never really stopped. So it may just be a much lower level kind of exchange that he's talking about. All right, Patrick Sykes, thank you. Patrick Sykes is Bloomberg News Middle East breaking news editor. Oil is falling this morning after President Trump said new talks with Iran would begin today after he called off a planned attack on the Islamic Republic.

18:00Brent this morning is down almost 5%. It's at$83.67 a barrel. This after swinging through a roughly$32 range last month. We want to get more with Mike McGlone, senior commodity strategist with Bloomberg Intelligence. Mike, good morning. Let's talk a bit about these swings. Is this just the way things are going to be as the situation in Iran continues? Yes, good morning, Karen. I think it's going to continue to be this way, but we have to keep in mind the number one motivation of the leader of the world's largest energy producer and a net exporter, Mr. Trump, needs lower energy prices by midterms.

18:36Now, he didn't get the unconditional surrender, I think he expected within two weeks of the start of the conflict with Iran, but now he's doing the work around, and he has to find some way to get prices lower. So that's the 10 on the 1 to 10 scale, which matters for energy. And you're seeing that now. You mentioned Brent. I like to focus on WTI. Right now, the price is about$79 a barrel. For the last 20 years, the highest volume price, the apex of the bell curve of trading is around$70 a barrel. So despite this pretty significant conflict, crude oil hasn't really moved much from those levels. In fact, I think put in a high this year.

19:07I think by the end of the year, it's going to be heading much lower. And the key theme to make that go lower is, okay, some kind of detente in Iran. But if the stock market has a little bit of pickup involved, that'll be a pressure factor for crude oil, too. Yeah, you see oil as low as $40 a barrel. Is that correct? And does that still hold? Oh, yeah. Well, I started making that call in 2023 on the way down after it peaked at$130. This year's high was$120, and the high in 2008 was$147. You see that trend? Lower highs and lower lows. The lows have been 40 cents. The significance is during that whole period, most of that period, U.S.

19:40was a net importer. Now, on a normal basis, if prices stay this high, by the end of 2028, the surplus and supply and demand of crude oil and liquid fuels out of the U.S. and Canada will approach 10 million barrels a day. By the way, that's about what China was importing before this conflict. So there's a major paradigm shift in the world. The U.S. to the Western Hemisphere with the U.S. in the middle is now the price maker status in crude oil. It is an oversupplied market with a bit of an aberration at the moment in the Gulf. And as we get to normalize a little bit, it'll switch back to an oversupplied market.

20:12And a key thing to remember is commodities always go to their cost of production. In the U.S., the largest producer, that's around$55 a barrel. All right. And we'll have about less than a minute here. Diesel. We did hear from Goldman Sachs this morning warning about a diesel crunch because of what's going on in Russia. Are you watching diesel? Oh, absolutely. Well, those are different markets. Diesel and distillates, gasoline. So diesel was at$5.36 a gallon before the crisis. It was just around$3.50. And same as U.S. average gasoline price,$3.10. Before the crisis, it was about$4. The thing is, now that's cutting off demand.

20:48It's a bit of a different market. But by the time we get to midterms, he needs those prices lower. And I fully expect they will be lower by the time we get to midterms. It's just how he figures it out. Could involve some kind of export restrictions. But right now, they're high. 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.

21:29Plus, 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. I'm John Tucker. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak.

22:00When you're running a business, the best days are the ones where priorities stay on track. For midsize and large companies, risk can affect multiple parts of the organization at once, from property and liability to cyber and regulatory challenges. At that level, managing risk becomes an ongoing discipline. At the Hartford, the focus is on helping businesses manage risk before it turns into something more disruptive. And when losses do happen, that work is paired with insurance coverage shaped by years of underwriting, risk engineering, and claims experience. Learn more at thehartford.com slash risk mitigation.

22:35Policies provided by Hartford Fire Insurance Company and its property and casualty affiliates, Hartford, Connecticut. Everyone's talking about how AI is transforming work, especially in sales. While the landscape shifts, one thing remains the same, the thrill of closing a deal. Whether it's a gong or a confetti machine, every team has its celebration rituals. Adio is designed for that moment. It's the agentic CRM that turns customer signals into actionable insights, helping you close deals faster. With revenue agents and automations working around the clock, you'll have everything you need to scale your go-to market efforts.

23:07Elevate your wins with Adio. Start your free trial at adio.com slash iHeart. M &M's popped caramel do sound different. Oh no, people are going to be obsessed. What do you mean? Hmm, people hate the sound of chewing. Maybe they won't like the crunch. Maybe we're saved. Wait a minute. Yellow. Huh? Have you been eating them this whole time? Mmm, so tasty. Hands off us. M &M's popped caramel. It's more fun together.