Primaries Show Trump's Political Power; Threat of More Iran Strikes

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1:42Bloomberg 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, we begin with politics and the results from a busy night of primaries in a half dozen states. Alabama, Georgia, Idaho, Oregon, Pennsylvania all held elections last night. But the contest with the most attention was in Kentucky, where President Trump flexed his muscle against longtime Republican Congressman Thomas Massey. With nearly all the votes counted, Massey has lost to the president's handpicked challenger, Ed Galrine, 54.9 to 45.1 percent.

2:26Massey says he's proud of sticking to his principles. I mean, we stirred up something. There is a yearning in this country for somebody who will vote for principles over party. And that was Thomas Massey in his concession speech last night. Bloomberg government's Greg Giroux says President Trump sent a message in this race. To Republicans in primaries who dare to cross him, who dare to Republican incumbents who might be thinking of voting against him on important legislation, particularly if they have upcoming primary elections, to maybe think twice about that and realize the political repercussions that could ensue.

3:01Bloomberg Governments Greg Giroux reports this was also one of the most expensive House primaries in history. Nearly$33 million went into this race for a reliably Republican district. Well, Nathan, some other key primaries are headed to runoffs, and Georgia Republicans will keep duking it out for Senate and Governor. Congressman Mike Collins and former college football coach Derek Dooley will face each other in the race to take on Democratic Senator John Ossoff in November. They got more than 70 percent of the vote combined and knocked Congressman Buddy Carter out of the race. In the governor's contest, Lieutenant Governor Burt Jones and health care billionaire Rick Jackson advanced to a GOP runoff, getting 38 and 33 percent respectively.

3:44Former Atlanta Mayor Keisha Lance Bottoms won the Democratic nomination in her primary with 56 percent of the vote. In Pennsylvania, Karen, three Democrats backed by Governor Josh Shapiro won their primaries in swing districts. The party hopes to flip in November. Janelle Stelzen, Bob Harvey and Bob Brooks all won their contests. They will take on Republican Representatives Brian Fitzpatrick, Ryan McKenzie and Scott Perry in November. And in Alabama, Nathan, voters will get a rematch between two high profile nominees for governor. Republican Senator Tommy Tuberville and former Democratic Senator Doug Jones easily won their primaries.

4:21Tuberville unseated Jones in their last Senate contest six years ago. Well, now, Karen, let's get you the latest on the war with Iran. President Trump is once again threatening to resume strikes. if Tehran doesn't reach a deal soon, and he says he won't wait much longer. I mean, I'm saying two or three days, maybe Friday, Saturday, Sunday, something, maybe early next week, a limited period of time. President Trump spoke to reporters at the White House ballroom construction. We get more from Bloomberg Middle East correspondent Jumana Bersechi. He's made these sort of threats before. He's given deadlines before and tends to extend them.

4:53So we can't take them perhaps too seriously or at his word. I think what we can piece together from all of this is there has been a huge, once again, diplomatic push, not least by Gulf states. And he specifically referenced the fact that Saudi Arabia, Qatar and the UAE are pushing to get to a diplomatic solution. Bloomberg's Jumana Bersetje reports Vice President J.D. Vance is striking a more positive tone as well, saying progress is being made toward a deal and more military strikes are an option B. Still, there are signs of discontent on Capitol Hill. the Senate has advanced a war powers resolution with outgoing Louisiana Republican Bill Cassidy flipping his vote on that measure.

5:31And Bloomberg News has learned NATO is considering a military deployment to protect ships if the Strait of Hormuz isn't reopened by July. Well, Nathan, Chinese President Xi Jinping is stepping up calls to end the war. The Chinese leader is hosting his Russian counterpart Vladimir Putin in Beijing. Xi called for a comprehensive ceasefire, saying, quote, restarting war is even more unacceptable. Russia and China are two of Iran's biggest backers. And President Putin and Xi praised the strength of their relationship as both countries seek to reinforce bilateral ties. In Europe, Karen, the European unions finalized the text on its long-awaited U.S.

6:09trade deal after months of negotiations. This clears a major hurdle to ratifying the pact before President Trump's threatened deadline for higher tariffs. We get more from Bloomberg Chief Europe correspondent, Oliver Kruk. What it now needs to do is go back to Parliament for a vote. It will have to go back before the member states. But of course, you'll remember that Donald Trump has amped up the pressure on the Europeans saying that there will be an additional tariff on automobiles that will go up to 25 % if they do not accelerate this process. He set as the deadline, July the 4th, the 250th birthday of the United States, that it needs to get done.

6:41And so now the Europeans are really accelerating. So hopefully everything's on track for them to get that over the line. Bloomberg's Oliver Crook says the deal initially struck last July would see the EU erase levies on U.S. industrial goods in exchange for a 15 percent tariff ceiling on its exports. Well, back here in the U.S., Nathan, Acting Attorney General Todd Blanche was on Capitol Hill for his first congressional testimony since he took the reins at the Justice Department. The agency is facing intense scrutiny over plans to create a$1.7 billion fund for people who think they were targeted politically.

7:13Bloomberg's Amy Morris reports from Washington. The fund will be managed by a group of five commissioners appointed by acting attorney general Todd Blanche, who conceded the fund is unusual. But it is not unprecedented and it was done to address something that had never happened again either. So there is an unprecedented nature in response to years and years of weaponization. Maryland Democrat Chris Van Hollen accused Blanche of, quote, doing the president's dirty work. You have clear conflicts of interest between your prior job as the president's personal lawyer and your duty to ensure justice.

7:47And Blanche would not rule out the possibility that January 6th rioters could receive payments. In Washington, Amy Morris, Bloomberg Radio. All right, Amy, thanks. Along the East Coast, it's going to be another hot one. It's pretty warm already this morning, but it's going to come to an end soon enough. Bloomberg meteorologist Rob Carolyn has more on the hot spell. Rob. Hot weather persists across much of the northeast again today. We're going to see temperatures well above 90 degrees from Washington through New York and even into the Boston area. But this is it. A cold front which is moving through the central United States heads our way.

8:19That'll set off some showers and thunderstorms later this afternoon and into the evening. And it's going to alter the pattern dramatically. We turn much cooler and unfortunately much wetter as we head into the Memorial Day weekend. Could see some showers on Sunday and Monday. I'm Rob Carolyn, Bloomberg Radio. All right, Rob, thank you. Let's turn to the markets now. A sell-off in longer maturity government bonds has pushed up yields to levels less seen during the global financial crisis, and strategists are warning yields can push even higher. Bloomberg's John Tucker joins us in New York with the very latest.

8:51John, good morning. Good morning, Karen. Global bond yields have surged in recent weeks on concern the jump in energy costs are going to feed into everything from plastic bottles for soda to gasoline for tractors needed to harvest crops. You add in worries over government spending and investors have been seeking greater compensation to own longer maturity debt. Joe LaVornia at SMBC says in this environment, the appetite for stocks could vanish. The narrowness of the market, the equity market, has been a handful of companies. And at some point, you know, that exuberance may itself be stretched.

9:24So if the Fed's tightening, financial conditions suddenly tighten, risk appetite changes, and it could unravel quickly. The rising inflation expectations will make the job of the Fed much more difficult. Among investors, the idea of cutting rates anytime soon has pretty much evaporated. I'm John Tucker, Bloomberg Radio. Okay, John, thanks. The bond market's not the only thing investors are closely watching. The most valuable company in the world reports earnings this afternoon. And Bloomberg's Tom Busby has more on what to expect from NVIDIA. Expect to see another blowout quarter of chip sales up as much as 80 % in Q1 as tech companies continue to ramp up their AI infrastructure spending and data center construction, even as NVIDIA face growing competition from AMD, Broadcom, Google, and others.

10:07Also key for investors, the latest on its upcoming Rubin chip lineup, CEO Jensen Wang's outlook on data center growth and his recent trip to China and efforts to reopen that massive market to sales. Bloomberg consensus calls for revenue of$79.15 billion and adjusted earnings per share of$1.78. Tom Busby, Bloomberg Radio. Great, Tom. Thank you. A labor dispute overseas could threaten global chip supplies. Talks between Samsung Electronics and its largest labor union have broken down, and this could put the global tech supply chain at risk because Samsung is the world's biggest supplier of chips that go into everything from data center servers to smartphones and electric vehicles.

10:48And a note in sports this morning, Karen. Bloomberg News has learned LiveGolf has begun laying the groundwork for a potential bankruptcy filing in the U.S. if it fails to raise new funds. Sources say the Gulf League's looking for money after its main backer, the Saudi Public Investment Fund, pulled its funding. While Liv's management looks for options, it is preparing for a potential collapse when the season ends in late August.

11:13Time 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. There is more information about the two teenagers who authorities say shot and killed three people in an attack on the San Diego mosque. Investigators say they had been radicalized online where they first met, shared white supremacist views, and left behind writings showing their hatred toward various races and religions. Authorities praised the security guard and two other men who were killed Monday for slowing the attackers, preventing them from reaching nearby schoolchildren.

11:50San Diego Police Chief Scott Wall. His actions, without a doubt, delayed, distracted, and ultimately deterred these two individuals from gaining access to the greater areas of the mosque. Chief Wall said the shooters killed themselves. Thousands of people are under evacuation orders as a wildfire continues to threaten homes in Southern California. The Sandy Fire in hills above Simi Valley had consumed more than two square miles and is 5 % contained. Meanwhile, firefighters are battling an uncontained 23-square-mile blaze on Santa Rosa Island. A woman died after falling into an open manhole in midtown Manhattan.

12:37According to Consolidated Edison, the manhole cover had likely been dislodged by a passing truck when it turned onto East 52nd Street from Fifth Avenue. Minutes later, the victim parked her car nearby. This man saw it happen. Online today, I just saw a bunch of stuff with people saying, oh, I bet she was on her phone. She must have been on her phone. And she wasn't. You know, she wasn't distracted. She didn't walk onto a construction site. I mean, she parked her car, stepped out of her car, and dropped right into the mantle. The NYPD says the 56-year-old woman, identified as Donna K. Gosaje, was found unconscious and unresponsive inside of the open manhole.

13:16They believe Gossadier would went into a cardiac arrest from the intense steam heat. Global News, 24 hours a day and whenever you want it with Bloomberg News Now. I'm Michael Barr. This is Bloomberg, Karen. Thanks, Michael. Time now for our Bloomberg Sports Update. And for that, we bring in John Stashauer. Thanks, Karen. Game one of the NBA's Eastern Conference Finals in New York and Cleveland little with under eight minutes to go, led the Knicks 93-71. But from that point through the five-minute overtime, the Knicks outscored the Cavs 44-11. They won game one in OT, 115-104. Jalen Brunson led the remarkable Knicks comeback, finished with 38 points.

13:55New coach in Dallas because Jason Kidd's not coming back in what they call a mutual decision. The Hall of Fame player was the Mavs coach for five years. Let your Bloomberg Sports Update. Stay with us. More from Bloomberg Daybreak coming up after this.

14:37This communication is issued by JPMorgan Distribution Services, Inc., member of FINRA.

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16:29This is Bloomberg Daybreak. Good morning, I'm Nathan Hager on the morning after a mini-super Tuesday in the midterm campaign cycle with contests in six states. President Trump may have flexed his hold on the Republican base most clearly in deep red Kentucky, where longtime Congressman Thomas Massey has gone down in defeat. Yeah, the people that want somebody that'll go along to get along, I've never heard of that strategy, but that seems to be what the voters want. Well, that was Congressman Massey conceding defeat to President Trump's handpicked choice, former Navy SEAL Ed Galrine. For more on the results, we're joined by Terry Haynes, the founder of Pangea Policy.

17:09So we heard Congressman Massey's takeaway from his defeat last night. What's your takeaway, Terry? Good morning. Good morning, Nathan. A few things. You know, you did, I think, three major things happened yesterday that showed just how intent Trump and congressional Republicans are on holding Congress in November. The first one is Massey losing in Kentucky in the House and Barr winning his nomination there. How quickly those races were called, I think, is the real tell there. Secondly, you've got the Texas primary Trump endorsing Paxton over Cornyn. And that's also a move to continue to pump up base enthusiasm.

17:52And even the Republican senators allowing a war powers debate to move, I think, has some positives. But fundamentally, what you see as a result of yesterday is you've got enthusiastic Trump-based voters level off Democrats' supposed enthusiasm advantage. You've got a redistricting advantage for Republicans now, plus a few truly toss-up races. I think all that is kind of pointing the arrow more in Republicans' direction in November. Let's talk a little bit more about the Kentucky race, particularly nearly$33 million poured into this district that tends to vote reliably Republican, according to Ad Impact.

18:33Does it make sense to put that much resources into a seat that is most likely going to be held by any Republican? Well, conventional wisdom would say no, of course. And there's a lot of significant Republican voice out there that would indicate that and be part of that. And at the same time, what you're seeing is you're seeing something that I flash on Franklin Roosevelt, who would have done exactly the same thing. You've got a leader of the party and the president who's trying to make sure to maximize his hold over the party, maximize enthusiasm for his votes, and also, frankly, maximize his hold on the party even after he leaves the presidency formally in a couple of years.

19:23So all of those point to reasons why it was important for Trump to do exactly what he did. And spending that money, I think, also provides a cautionary tale to a lot of other people who might be tempted to step outside the box on Trump, but now probably won't. You mentioned the endorsement, the late endorsement of Ken Paxton in the Texas Senate race. race there's some thinking I think on the Democratic side that Senator Cornyn might have been a stronger candidate against James Tallarico in that race with the Georgia Senate race headed to a runoff as well. What does that mean for Republicans getting closer to November here?

20:08I think what you've got here is a situation where the defining characteristic of any decision for Trump is pumping up the base as absolutely as much as possible to ensure that they'll get out there. Remember that one of the advantages Democrats say they had, and I think they did have, was kind of winning the enthusiasm gap, as political people call it, the idea that Democrats' voters are much more enthusiastic about getting out and getting their candidates into office than Republicans are. That's why what happened in Kentucky, what's happening in Texas, what happened in Indiana a couple of weeks ago are all very important because you're seeing the leveling out of that enthusiasm gap.

20:54So by and large, that's a bad signal for Democrats. Does that enthusiasm continue when we still have an Iran war hanging over the president? We have a A new Associated Press NORC poll just out this morning of Republican voters saying that they're feeling less happy about the economy now as well, with just 6 in 10 Republicans approving of the president's handling of the economy, down from 8 in 10 in February. Oh, sure. I think that absolutely remains a headwind. You know, I don't discount at all that Trump and Republicans have significant headwinds, or that it's going to be difficult convincing the same independent voters that moved for Trump against Harris in 24 to come back home in specific congressional races.

21:46I don't discount that at all. All I'm suggesting is that the political dynamic here and the things that motivate voters the most are swinging back evenly and pointing a little bit more in Republicans' direction. The war with Iran does have an impact on the economic outlook going forward, though, doesn't it? Oh, greatly, yeah. I think that's very true. And, you know, one of the things Republicans are counting on and hoping, led by the president of the White House, is that you get a resolution of that sooner rather than later and that that has positive impacts on, among other things, prominently gas prices.

22:31Got about a minute left here, Terry. There was a race in Pennsylvania as well. Governor Josh Shapiro's candidates that he supported in House races won their primaries. in swing districts. Does that have any impact on the congressional math heading into November, or is it just on the margins? Yeah, I think it is marginal. I don't mean to discount it, though. Shapiro showing leadership in his party is important. I think that's important for him as a potential presidential candidate in 28, by the way, also. But putting together candidates with Shapiro's endorsement in Pennsylvania makes those candidates look more centrist and allows them to have more competitive races.

23:20Sure. 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.

23:57It'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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