US-China Tariff Deal; Iran Won't Soften Demands

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1:44Good morning. I'm Karen Moscow. And I'm Alexis Christophorus. Here are the stories we're following today. All right, Alexis, we begin with the latest on U.S.-China relations following the summit between Donald Trump and Xi Jinping. The two countries detailed a plan to cut tariffs on about$30 billion of imports from each nation. The list for goods entering the U.S. contains 77 entries, including fireworks and toys, while more than 1 ,600 goods are set to potentially enter China, such as meat and medical equipment. We get more from Bloomberg Chief Asia Correspondent Stephen Engel. It's putting some details to what they agreed on, on maybe the lower hanging fruit of trade disputes.

2:28There's still a lot more contentious issues, no doubt, including chips and other national security items. Bloomberg's Stephen Angle says the expected tariff relief of$60 billion in bilateral trade is a fraction of the$415 billion in total goods exchanged between the world's largest economies last year. And Karen, now the latest on the war in the Middle East. Iran is sticking to its seven-day proposal for reopening the crucial Strait of Hormuz, saying it won't soften its conditions, while President Trump sent mixed signals about his willingness to reach a deal. We get more from Bloomberg Middle East correspondent Abir Abu Amar.

3:03President Trump had rejected this plan that Iran had laid out about a seven-day ceasefire to reopen the Strait of Hormuz. He did say that he might have agreed to the conditions that Iran had laid out a year ago, but Iran had overplayed its hand. Now, from the Iranian side, we also have heard from the foreign minister, Abbas al-Aqsh, who said that diplomacy is always on the table. Iran prefers diplomacy, prefers to go back to the negotiating table, but that he doesn't see a way for it. Middle East correspondent Abir Abu Omar, oil rising on those latest developments. Right now, we've got Brent crude nearing up 4 % at 108.21 a barrel and WTI crude rallying 3.5 % at 95.57 a barrel.

3:47Alexis, UK police are investigating a potential terrorism incident after five men were arrested near an airbase used in U.S. strikes on Iran. We go to London and get the very latest from Bloomberg's Nathan Hager. Nathan, good morning. Good morning, Karen and Alexis. So this was near RAF Fairford in the area of Gloucestershire in Western England. The U.S. has been using it as a forward staging base for bombers in defensive strikes against Iran. Local police say they got a call around a quarter to one in the morning yesterday local time of three suspicious vans appearing to be headed toward the base.

4:20Armed police arrested five men while dozens of residents were evacuated from a nearby village and a bomb disposal unit came in to examine the vehicles. President Trump says the suspects were looking to do big damage. In his words, he suggested some of them may have been under surveillance, but he didn't give more details. UK Defence Minister West Streeting told Bloomberg this morning it's too soon to link the Fairford incident with the Iran conflict. But a source tells Bloomberg police think they disrupted a serious attempted attack at a late stage. In London, Nathan Hager, Bloomberg Radio. Thanks, Nathan.

4:50The arrests come as UK Prime Minister Andy Burnham goes into his first Labour Party conference as Britain's Prime Minister. Bloomberg's James Wilcock is covering the four-day event and joins us from Liverpool. Good morning. It's clear skies here in northwest England and the UK Prime Minister wants to envision a brighter future. Bring back hope is the pitch here. But with bond yields at multi-decade highs, there are concerns there may be clouds gathering. West Streeting also told us, the Defence Secretary there, that we know perfectly well that if we're out there making unfunded commitments, the market's priced in risk and we face higher borrowing costs.

5:26The UK Chancellor makes his speech in just two hours and we'll be here covering it. In Liverpool, James Wilcock, Bloomberg Radio. All right, James, thank you. Back here in the U.S., the Northeast is still feeling the remnants of the nor 'easter over the weekend. And the New York area coastal flood advisory is in effect until this afternoon. We get more with Bloomberg meteorologist Craig Allen. The weather is still pretty nasty along 95, especially from northern New Jersey, New York City and Long Island on up to Boston and suburbs. But the forecast is improving. And after more than 48 hours of wind-driven rain and coastal flooding, the nor 'easter is weakening.

6:03It is moving very slowly, though, just meandering. So it will take a while for drier air to arrive. Expect some gusts over 20 miles per hour today, additional showers around. For our listeners in Washington, improvement will get underway today. But for the rest of the northeast, hang on until Tuesday or even more so Wednesday as the sun returns. And that's Bloomberg meteorologist Craig Allen. The storm caused chaos for some air travelers, but its worst impacts were coastal flooding and power outages. More than 100 ,000 homes and businesses were without power Sunday morning from Massachusetts to Virginia.

6:38Long Island was among the harder-hit areas with more than 24 ,000 customers still without electricity in Suffolk and Nassau counties. And Karen, we now turn to the markets where a sell-off in Treasuries is resuming as we begin a new work week. Checking Treasuries right now, the 10-year yield up six basis points at 5.22 percent. The 30-year yield up four basis points at 5.53 percent. And the two-year up six basis points, closing in on 5 percent, now at 4.91 percent. Meantime, Treasury Secretary Scott Besson says the Fed should keep an open mind on interest rates. Besson said productivity gains from AI, along with deregulation, will help keep U.S.

7:18inflation in check. It's the deregulatory aspect. We have created supply with deregulation. We got the great inflation from the Biden years because they had a demand shock that was met with supply constriction with all the regulations and the expansion of the regulatory state. And their demand shock was government driven. We have a private sector demand shock, and that is being met with more supply because we've deregulated. Treasury Secretary Besson added that core inflation has actually dropped over the past few months. Well, Alexis, Microsoft co-founder Bill Gates has joined a chorus of tech leaders warning about the safety risks to fast-tracking AI development.

7:59Gates says a kill switch to restrict models may not be enough. He spoke on NBC's Meet the Press, which can be heard Sundays on Bloomberg Radio. We do need to monitor any sophisticated model and record exactly what's being done. The United States ought to make sure this is done. China will want to do this. And that's Microsoft co-founder Bill Gates, who warned that artificial intelligence is a powerful enough tool to kill off a substantial portion of humanity. Meanwhile, we are hearing just now that NVIDIA has introduced a new double-layered artificial intelligence security system that it says would have prevented the recent high-profile breach of hugging face by OpenAI's AI models.

8:465.08 on Wall Street. 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 Barr. Good morning, Michael. Good morning, Alexis. The Department of Justice is still defending President Trump's decision to ban CNN, MSNOW and Politico from the White House over their coverage as court battles over media access at the White House continue. U.S. Attorney General Todd Blanche on ABC's This Week argued that the administration banned three news outlets from the White House because it is a privilege, not a right, to be there.

9:20The president hasn't denied access. That's not the right way to describe it. This is what the president has said, is that he is sick and tired of certain media outlets just refusing to report accurate news. ABC's This Week can be heard Sundays on Bloomberg. New Jersey Republican Congressman Tom Kane Jr. and Democrat Rebecca Bennett clashed over the war in Iran and tariffs during a debate for a House seat. Kane defended President Donald Trump's tariffs and decision to launch attacks on Iran, while Bennett called for an end to the war and urged Congress to rein in President Trump's use of tariffs.

9:55The debate was held in the battleground 7th Congressional District, which has changed party control in each of the past two midterm elections. A New York prosecutor is reopening the investigation into allegations that a Cornell University student was gang raped at a fraternity house. It comes after a former student, identified as Jane Doe, sued Cornell, the Chi Phi fraternity, and seven of its members, claiming they pressured her to take drugs and sexually assaulted her in 2024. Last night at a town hall near Cornell, Congresswoman Alexandria Ocasio-Cortez weighed in. She had to lose her education.

10:35And those men were protected by an institution and granted an Ivy League degree as a reward. Never again. Cornell would not comment on the lawsuit, but said the fraternity remains barred from campus. 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. Thanks, Karen. Some wild games in Week 3 of the NFL, including the one played in Brazil. Baltimore and Dallas seemed headed for overtime when the Cowboys kicked off with only 7 seconds to go.

11:15The Ravens got 1 second put on the clock, and Tyler Loop kicked the game-winning 56-yard field goal, and the Ravens won by 3. Last night in Denver, the Broncos trailed the Rams by 16 points. Midway through the third quarter, Denver scored 30 points in the last 22 minutes to stun the Rams. The U.S. won the President's Cup golf. That's your Bloomberg Sports Update. Stay with us. More from Bloomberg Daybreak coming up after this. Some people treat ChatGPT like some kind of smart search engine, and some use it to get work done. ChatGPT Work is a new way of working in ChatGPT that can take action across your apps and files, stay with a project for hours if needed, and turn a goal into finished work.

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14:22Jersey. It came up about six, eight inches onto the house. We've been here 25 years. It was second to Sandy. And Muscarello referring there to Superstorm Sandy back in 2012, which caused some$60 billion in damage across the eastern U.S. We want to get the very latest on this storm now with Bloomberg meteorologist Craig Allen. And Craig, okay, not as bad as Superstorm Sandy, but still pretty bad for many of us. Where are we now with the system? Good morning. Yeah, it sure was. As a matter of fact, looking at some of the records here, it is in the top five for flood concerns and coastal flooding, tidal inundation across southern sections of New Jersey, Long Island, the Long Island Sound, meaning the Connecticut coast, and on up towards Boston.

15:09So where are we now? Right now, we still have some lighter rain. The storm has weakened. It is about, I'd say, 75 to about 100 miles off the central New Jersey coast. That's how slow this thing is moving. I mean, really just meandering. So it's going to take another day to get out of here. But the good news is that now that it has weakened, the winds are definitely not as strong and the tides are not going to be as high. They are returning back more so to normal, so there won't be that kind of coastal flooding like we had over the course of the weekend. But unfortunately, the area of rain that is left over with this is making its way on up towards Boston, so there will still be more rain all day around Boston, showers and thunderstorms.

16:01And here in the New York City area, I would say off and on rain. It'll be cool. It won't be pretty. But it certainly won't be as bad or as stormy as it was over the weekend. Okay, well, that's pretty good to hear because we were hearing that high tide was still a bit of a concern for this afternoon. So you're saying a little less of a worry then. Exactly. It's definitely going to be a concern. A coastal flood advisory is in effect, but it's an advisory now. Now, it was a warning over the weekend where we had inundation of about two or three feet coming up on many of these coastal towns, be it Long Island or the Jersey Shore.

16:37And as a matter of fact, even all the way on down to Maryland's eastern shore, there were high tides. But now that is moving its way on up into the New England area, Cape Cod, the islands in Boston. That's where it's going to be probably the toughest for the day today. New York City, you'll see a gradual diminishing of the tidal flooding as we go through the next 24 hours or the next two tide cycles. Craig, you know, I hate to ask this, but is this giving us some kind of indication into what the storm season is going to be like? Is it going to be this bad? Oh, I knew you were going to ask that, Karen.

17:17You know, there's a lot of thought with the way El Nino is set up out in the Pacific, that it is going to supercharge storms coming across the United States or developing off the East Coast. Not tropical, not hurricanes. Obviously, it has thwarted the hurricane season in the Atlantic. But the storms, there are some schools of thought here that they are going to be intense and they could be a little bit more frequent. Now, an El Nino pattern also means a little bit warmer here in the east. So I'm not saying that they're all going to be snowstorms, but it's certainly going to be something that we're going to have to watch over the next several months.

17:59This 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.

18:39Search Bloomberg News Now on your favorite podcast platform to stay informed all day long. I'm Karen Moscow. And I'm Alexis Christophorus. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak.

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19:33It's also taking care of what gives your life meaning. That's why your dedicated financial advisor meets you where you are with personalized financial strategies that help protect what matters. So you can preserve your progress while creating a path forward. The key to being rich is knowing what counts. Let's find your rich together. Edward Jones, member SIPC. This is Alexis Christophorus for Bloomberg Surveillance. Most companies have tried AI. Most aren't seeing results. Not because AI doesn't work. It's because AI hasn't reached the workflows yet. That's the gap Asana is built to close. Asana is the operating system for human agent teams.

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