every day, comcast business is helping businesses go beyond the expected. to do the extraordinary. take your business beyond. >> good evening from bloomberg's world headquarters. i am shery ahn in new york. haidi: and i am haidi stroud-watts in sydney. welcome to daybreak australia. here are your top stories for today. the coronavirus maintains its global grip iand infections have now passed 1.5 million. their first gains of

the week. opec and its allies will meet thursday to discuss a new plan. the virus has far-reaching implications for businesses. a new study says global trade may be cut by one third, more than what was seen during the financial crisis. shery: let's get you started with a quick check of how markets ended in the u.s. we are seeing u.s. stocks again pushing into bullish territory after failing to do so in the last session. u.s. stocks now gaining more than 20% over the march 23 low. every sector in the s&p 500 was in the gleam -- green, led higher by energy stocks. dow gained more than 3%. u.s. futures unchanged. nasdaq gained 2.6% in the regular session. take a look at what oil is doing, because we saw it rebound from the weakest level since the start of the month. it spiked a few minutes before the close, after the opec plus meeting will discuss and output

cut of 10 million barrels per day. at the moment continuing to add to the gains, up 4.6%. just breaking on the bloomberg, a saudi arabia sovereign wealth fourroughly $1 billion in major european oil companies. happening right now, the press conference at the white house on how they are handling the coronavirus up break. you are listening to secretary of state mike pompeo. thank you all. in just a few days we have delivered nearly 11 million n95 masks to hotspots around the country, as you know, including 6.6 million to new york and new jersey, 1.8 million to chicago, 1.7 million to detroit, and 837,000 to new orleans.

i spoke with the governor of louisiana a little while ago and they are doing really pretty well. much better than they thought. they are using fewer beds. build a hospital. we are set to complete another hospital. there is even the possibility they will not need it. that is what we discussed. today we have shipped out more than 8000 ventilators, and we have almost 10,000 sitting there ready to go should we need them, and an additional 2200 newly manufactured ventilators come online monday. we will send them to various locations in case they need them. our administration is working with philips to double their production of ventilators by may, and ultimately quadruple production by later this year. high quality ventilators. we are eliminating bureaucratic barriers to pave the way for inllips, major investments

manufacturing sites and sales. this will help to ensure our company -- country can permanently produce ventilators in the future by ourselves. we will have a big stockpile when we are finished, and we expect to send quite a few to other countries to help them after we are finished, and even now. a couple countries are really, really in dire need. and looks like our projections were right on ventilators. in some states that were thinking they would need thousands more than they thought of,now already taken care which we are very happy about. in addition, beginning in may we almost 300eiving million new face masks. we are going to have masks, about 300 million, they will be starting to be delivered in may and during the month of june. so we are ordering a big stockpile and we are thinking about doing an extra 200 million should we need them, or for the

stockpile. so we will be in a position to have something incredible. it will be a total of 500 million masks. newtoday, 750,000 protective gowns landed in dallas, texas as a result of a partnership between the federal government, dupont, and fedex. that has worked very well. we have 750,000 new protective gowns. these are at a high level, very high quality. as american industry steps up to help, so our america's doctors and scientists. 10 drugs are in clinical trial, and my administration is taking unprecedented actions to make new therapies and treatments available without delay. the doctors, the lab technicians, the companies, i spoke to them yesterday, spoke again today. they are coming up with things that i think, i hope in the very near future, are going to be very, very special, very

important. our national stockpile is now equipped with nearly 30 million hydroxychloroquine pills. so we are up to about 30 million. we are disturbing them by the millions. you read about state representative karen would step, who i very much appreciate her going public. but i think she was very, very much helped by this pill. she saw what i was saying on television, she thought she was in very bad shape. i do not want to go story -- further than that but you know her story. she is a highly respected state rep from michigan. and i think she did a great service, what she has done. she is in terrific shape. she looks fantastic. and she was very generous with her statements. zithromax andhe and czink -- they say zinc now,

it all has to be recommended by doctors, physician, but they say zink. -- zinc. that is where they seem to be having the best result. you had the zinc and the zip through meissen -- and the other one. a lot of good stories. we have almost 30 million doses. a lot. i want to thank prime minister modi of india for allowing us to have what we requested from before the problem arose. and he was terrific. we will remember. later today the cdc will release further guidance to help ensure critical infrastructure workers pay -- can perform their jobs safely after potential exposure to the virus. and so they are working on that. the question was asked a little while ago about the world health organization.

know, they made a statement on january 14 i guess it was, that there was no human to human transmission. well, there was. they probably made that statement in december but they made it very powerfully in january 14. they criticize me very strongly when i shed -- said we are going to shut down flights coming in from china, especially from certain parts in china. but we were criticized very badly. so last year, and for many years, hundreds of millions of dollars has been paid to the world health organization. hundreds of millions of dollars a year. illion.t year was $452 m million. paid $42 before that it was 500 million dollars and china paid less than $40 million. and before that it was similar

umbers, in the for hundre -- hundreds up to five millions, and china would do a small fraction of that number. and i think they have to get their priorities right. thatheir priorities are everyone has to be treated properly, every country. and it does not seem that way, does it? so we are going to investigate and make a determination as to what we are doing. in the meantime we are holding back. we are going to say very unfair. the united states, $425 million compared to $42 million to the world health organization. that is not good. not good. not fair. not fair at all. and other countries as you know also gave substantially less than the united states. world -who -- they go

tit -=- -- they got it wrong. in many ways they got it wrong. they minimized the threat area strongly. not good. i want to thank the american to go to work every day. especially in these critical industries in the midst of the pandemic. feedre for and protect and american people, including medical personnel, law enforcement, first responders, food suppliers, sanitation workers. and somebody mentioned today, would you specifically call out cashiers and clerks at grocery danger during in the pandemic. during the epidemic. they are in danger. they are really in great danger. and they had been incredible and i want to call them out.

cashiers and clerks. we grew up with cashiers and clerks and grocery stores. and they have been great. true american heroes. i want to call them out because they are working hard and working in conditions that are not ideal. but soon they will be ideal again. as we mourn the terrible this, and from disgraced pandemic, we are seeing signs that our aggressive strategy to slow the spread is working. the number of new cases is stabilizing. the number of beds necessary in so many locations -- i was walking -- watching this morning new york, louisiana, you see what is going on. the numbers are changing and they are changing rapidly. soon we will be over that curve, over-the-top, heading in the right direction. i feel strongly about that. some terrible days ahead we are going to have some wonderful days ahead. and we are going to get this behind us, this terrible thing

behind us. some people will never be able to forget. if they had a loved one or a great friend, a friend. but we are going to get it behind us. this is a tribute to the discipline and devotion of the american people, what we have accomplished. continues toican strictly adhere to social distancing guidelines, we can defeat the invisible enemy and save countless lives, and we can do it much more quickly. we are hopefully heading toward a final stretch. the light at the end of the tunnel, as i was saying. --we continue to wait out wage all-out medical war against the virus. we are also fighting an economic war to make sure we can quickly return to full financial strength. we have to get our country back. we have to get going. everybody wants to get going. yesterday i asked congress to provide an additional $250 billion to expand the incredibly successful paycheck protection program.

we have seen what has gone on their. it is incredible, actually. which is allowing our small businesses to pay employees and get ready for the opening. a second opening. to protect millions of jobs i'm asking congress to pass additional funding for this program. this week as soon as possible. i think we have a pretty good understanding the democrats. hopefully it will be bipartisan. we did not have the time or the partisan games, we do not want that, the obstruction. or totally unrelated agendas. we want to do this for the small businesses and the workers. and we can do a phase for, and phase four will be later. this will be an expansion of what we have already done, because it is so successful, the $350 billion be expended by hopefully $250 billion. if you look at the kinds of loans, tens of thousands of loans to small businesses. it's a great thing to see. it has turned out to be more successful and more productive

than anybody would have thought. but democrats and republicans are coming together to get that job done. that is a very important job. in recent days and days ahead, we will restore america's health and economic might, but also dimensions of our national strength will be brought -- iher, i think, stronger think we have a chance to be stronger than ever before. we have learned a lot. and we have tremendous stimulus now, tremendous stimulus. hopefully we will be doing an infrastructure bill so we can rebuild our roads and highways and bridges and tunnels and all the things that we should be doing for our country. we are going to rebuild our country, not other countries, where they do not even appreciate it. as our serve -- civilians persevere through this challenge, we are renewing american unity and replenishing american will, and we are witnessing new american valor each and every day. we see it every day, the daring and determination of our people

in this crisis reminds us that no matter how hard it gets, no matter what obstacles we must overcome, americans will keep on fighting the victory and we will secure the glorious future that our citizens so richly deserve, especially after going through this nightmare, this evil beast. so we are getting very close, and hopefully it is on the others and it will end soon. and i think it will. i just think that the people of this country are fantastic. so we will take a few questions and then vice president takeover. please. reporter: abc is reporting that your intelligence was warning about the virus as early as november, and produced a detailed report about the outbreak in china. when did you first learn about the intelligence, and could you have acted on it then? pres. trump: when i learned about the gravity of it was some

time prior to closing the country to china. and when we closed up the flights coming in from china and various other elements. and as you know we closed up to europe. so, i do not know exactly, but i would like to see the information. reporter: a lot of americans want to see business reopen. pres. trump: soda why. more than -- so do i. more than anybody. forrter: what has to happen us to safely reopen and what is your plan? pres. trump: we have to be on the downside of the slope and heading towards a direction that this thing is gone. we could do it in phases, some areas are much less affected than others, but it would be nice to be able to open with a big bang and open up our country, or certainly most of our country. and i think we will do that soon. you look at what is happening, i would say we are ahead of schedule. you hate to say it too loudly because all of a sudden things will not happen. but i think we will be sooner rather than later.

but we will be sitting down with the professionals, with the many different people and making a determination. and those meetings will start taking place fairly soon. reporter: you will not do it until the health experts say to? pres. trump: i would rely heavily on them. reporter: the monitoring you're looking at -- pres. trump: we have the best testing systems. and don't forget, when we look at cases, i am not going to insult anybody, i am not going to insult any country, but i'm looking at countries that are showing less cases than us. it is testing. we are testing more than anybody. you saw exponentially more than anybody by far. and our testing has become, i think it will end up being a big strength and affect other countries. other media the -- other countries the media talked about are now calling us, how are we doing it so quickly, and we are we getting these tests, because our tests are really good now, they have been proven to be very accurate. reporter: two quick questions.

one on infrastructure. members of your ministration and members of congress have pointed tennesseeead of the authority, he made $8 million last year. pres. trump: ridiculous. it is ridiculous. i think it is the highest-paid government -- long before i got here, you said tennessee valley authority, has to be the highest-paid man in any government. makes approximately $8 million or $9 million. i did not know the gentleman but he has a heckuva job. paid a lot of money. been there a long while, hasn't he? reporter: he came in april. pres. trump: that is separate. we have some new people going on the board i know. as you know, that is a quasi-public agency. and whoever the head of the agency is, that person makes a lot of money. which is an amazing thing.

and we want them to do something. they are not there for us. that is not good. he has been there for a long time. that has been a story for a long time. reporter: reducing that salary as part of the infrastructure bill? pres. trump: reducing it by a lot. that is the greatest job in the history of government almost. certainly if you are into money. tennessee valley authority, that's right. i have been waiting for somebody to ask me about that. that has been bothering me for long time. reporter: one of the biggest ridding hits of the coronavirus has been a show on netflix called tiger king. man is a former zoo owner forming a prison -- he is asking you for a pardon. said he would advocate for it. pres. trump: which son?

must be don? i know nothing about it. 22 years for what? reporter: allegedly hired someone to murder an animal rights activist but he said he did not do it. pres. trump: you think he did not do it? are you recommending a pardon? as a reporter you not allowed to do that. would you recommend a pardon? reporter: i am not weighing in. joe exotic? reporter: i want to go back to the coronavirus. last week your top experts are saying we should expect 100,000 to 24,000 deaths. -- to 240,000 deaths. are these numbers being revised downward? i know you do not want people to stop social distancing but what can you tell us about the numbers? pres. trump: my impression is those are the numbers that were

sent as an expectation from a while ago. i think we are doing much better than those numbers. if either of you would like to talk about that, that is a fair question. so, i think many of you have done the analysis of the same models that we utilize. if you do the models of the models, you end up with that range -- haidi: listening to president donald trump speaking at the daily coronavirus briefing two an update on testing and taking questions from reporters. addressedresting he when the u.s. economy might be reopening. he seemed very enthusiastic about that prospect in the last few days, but saying he would rely heavily on medical experts, that in terms of strategy it could be a targeted reopening across the country that has not been as widely affected.

the president saying it would be nice to do a big bang reopening. in terms of testing treatments and getting control over the coronavirus spread, that he think the u.s. is ahead of schedule. aqlso criticizing -- also criticizing the world health organization, saying they have gotten it wrong, including the reaction to travel restrictions, the restrictions on arrivals in china. again, talking about some viral drugs that are in clinical trials. let's get more on the markets and how we have seen that reaction. joining us is the founder, ceo and chief executive strategist of mainstay capital management, david kudla. great to have you. let me start off with a chart. it feels incongruous to me we have u.s. stocks, the s&p now 20% up from its march lows.

if you look at this chart taking a look at the probability of a recession in the u.s., we just hit 100% on that. is there a sense that these two narratives do not quite mesh, particularly since we do not know when the economic opening will be, we do not know if they will be more waves of coronavirus in sections as we have seen in other parts of the world? david: it is interesting. we have such confidence in the markets at this point in time, you would think that the whole pandemic is behind us, and investors are already pricing in a full recovery of the economy coming at a pretty rapid pace. when in fact in the u.s., we have not seen -- and europe for that matter much of the world -- we have not seen these negative economic numbers come in yet in terms of gdp. in terms of the bottoming

out of this market, it's a process, isn't it, rather than hitting a certain point where you think it is safe or opportunistic to get back in. what is your investment strategy at this point? david, i think we have lost you. we will try to get back to you in a moment. us. was david kudla with shery: let's not get the first word headlines while we try to reestablish that connection. a dire new warning about the effect of coronavirus on global trade. the wto says the fear of shipments of -- and orders may slump by one third as -- the drop could be worse than in

the financial crisis a decade ago. the bleak forecast is due to the unpredictable nature of the pandemic. ♪ in every region of the world and across all sectors of the economy. in an optimistic scenario, our economists see the volumes of global trade tumbling by 13% in 2020. now, if the pandemic is not brought under control in the government fails to coordinate responses, the decline could be 32% or more. shery: a new study says the chinavirus spread through far faster than previously thought. the u.s. report says that each person infected early on probably pass the virus on to more than five others, more than twice the forecast from february. more than 1.5 million people

have tested positive around the world. president xi jinping says china is facing new economic and social challenges as a result of the virus, with rising numbers of infections and growing threats. he said to step up policies designed to resume work and boost domestic demand. they include the reopening of commercial operations and the speeding up of investments. the government says the fallout from the pandemic is unprecedented, and the program aims to protect 6 million workers. the government will subsidize waves -- wages to the tune of 1500 aussie dollars every two weeks to help businesses keep people in work. a new study says japan is facing a double digit contraction this quarter as the coronavirus stalls the economy.

all 17 economists in a bloomberg survey see the economy shrieking in the current period, with all but one forecasting a moderate recovery between july and september. projections come after prime anister shinzo abe declared record stimulus package. let's take a look at how things are faring on the oil patch. very volatile session when it comes to oil prices, but a jump as much as 12% when it comes to wti in the previous session. of course this is on the back of a willingness being expressed on the russians that they could potentially cut up to 14% of their output. something of a consensus between the russians and saudi arabians in terms of that cut in output. of course that is going into the opec-plus meeting as well, meaning we could see oil and energy stocks outperforming. energy one to watch as we start trading in australia. it is risk-on.

we are seeing asian futures tracking higher. seems to be a bit of fragility to this rally at the moment though. a lot more to come. this is bloomberg. ♪

we are seeing crude oil futures continue to gain ground. futures in new york rose as much as 12%. it was a day of wild swings which saw wti futures despite a record rise in inventory. su, we are hearing that russia could be potentially willing to cut production, but still a lot of skepticism out there. su: yeah, there was lots of skepticism over the past two days as well as a technical factor of a huge oil fund roiling -- rolling over into

future contracts which added to the volatility. but a lot of doubts were ended late in the day when we saw oil spike ahead of the close, as algeria confirmed the opec-plus are talking about, quote, massive cuts of over 10 million barrels a day. that coincided the pressure indicating that they are talking about a 14% to 15% cut in their production. and that is significant. there has been a lot of questions as to whether russia would be willing to make such a cut, and this one is much greater than expected. so that certainly has added some optimism. and there has also been support from investors that are really focused on the specific numbers, and that is what we are getting for the first time. of course this was the first gain in the regular session in three sessions. and it's also the fact that we had an inventory report that was

the most irish -- most bearish in record inventories, the biggest gain since 1982. we also had physical prices continuing to be in dire straits. $10 oil is what we are seeing. in canada, physical prices for oil are at record lows. the real question is when will demand return, but a lot of optimism over the opec meeting. haidi: that is the big question, isn't it? take a look at gasoline demand, it has been cut in half. that has caused u.s. refineries to shut down. so what is the latest and where do we go from here? su: yeah, the u.s. inventory data it usually comes out with demand figures, and that shows gasoline demand is down about half from a year ago, down across the world. we are hearing a number of large

refineries are lowering the rates and idling the rate at which the turnout gasoline. and we know that marathon petroleum, for instance, is already planning perhaps to shut down, and they are pointing out that there could be others to follow. valero and phillips 66 have already lower their lights -- rates. an industry expert points out you do not just turn down -- turn off a switch to shut down these refineries. it is complicated. so they are waiting until they need to shut down to do that, so capacity continues to come down. it's interesting as we see the g20 nations meet, we know some additional oil producers may roll in with production cuts. and also for the first time, a u.s. president, president trump, is being pushed to push for higher oil prices more in line with saudi arabia because this

will mean stability for oil markets. youi: all right su, thank so much for that with the latest on oil going into the opec-plus meeting. plenty more to come. this is bloomberg. ♪

global cases of the coronavirus infection have topped 1.5 million just one week after passing the one million mark. new york, the u.k., and belgium

reported the deadliest day so far. cases are rising again and governments continue to hammer out support programs. the world health organization continues to caution against any easing of virus restrictions. politicize this virus. the differences you have at the national level. exploited, andbe if you want to have many more body bags, then you do it. haseanwhile hong kong announced a new stimulus package worth almost $18 billion as the economy deteriorates further amid the coronavirus operate. the program includes support for jobs like subsidizing 50% of wages for affected workers over the next six months. the subway operator is being asked to cut workers by 20% amid

what the government said is quote, an unprecedented challenge. is imposing spending caps. the finance ministry says expenditure is under review, under stress until june at least. it is being capped at 15% a budget estimates presented at the start of the current fiscal year. new data shows airline flights slumping in the first days of april as the virus hammers travel demand. far fewer planes are flying across the country. u.s. airlines are painting a bleak picture post-pandemic, with some saying they expect to slash domestic flights as much as 90% in the coming months. the aviation industry is appealing for government aid as revenue slumps. global news 24 hours a day on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries.

this is bloomberg. let's get back to the market. we are rejoined by mainstay capital management founder and ceo david kudla. thank you so much for being patient and staying with us. i want to pick up on the last point we were talking about, the process of bottoming out. we heard president trump say earlier he would love to see a big bang reopening of the economy, but realistically it could be more of a targeted, staggered reopening across part of the country. buy signal at this or would you really need to see more evidence from health authorities before you feel that confidence? david: it is interesting. when we have been modeling this bear market and the eventual recovery, and we still look at this as an event-driven bar

market, not a secular market. into a secular market if it goes on long enough, if employment and enough of the dislocations we have seen in the bond market, if we see credit become more of a problem. there are those who already want to call a secular market, much more catastrophic like 2008, 2009, and the financial crisis. we still consider it more in the event-driven bear market category that we recover from a lot more quickly and the drawdown is much more severe. that said, we think we are still in the bottoming process. there's more to go here, there is more volatility ahead of us. i think what has given investors a lot of confidence is, as i said in our last segment here moments ago, is that we have seen improving data i think on coronavirus at a quicker rate than maybe was expected, at

least here in the u.s. and now we have had dr. fauci, who was widely respected in this country for his credibility in all infectious disease and the work he has done, who said that of allx, or the height of our flatten the curve efforts, the apex could becoming as early as one week. that has given investors a lot of confidence. do we get a second or third wave as we spoke about earlier? what is really the ultimate consequences in terms of the economic impact? first quarter earnings, second quarter earnings -- that is yet to be determined. so i think it is early for investors to think that we have the all clear. shery: how does the price of oil factor into all this? we have seen oil prices really falling across the board. president trump at the moment in

the white house being asked about a potential oil cut in the u.s., saying the u.s. has already cut. the business is market oriented but a lot of exultation's as to what the u.s. will do as we get the opec-plus meeting. what does this do to asset places? david: when we look at -- prices? itid: when we look at march, exacerbates the problem. we look at lower quality bonds, junk bonds, it certainly exacerbated the problem in yield spreads and the problems in junk bonds because of what was happening, with oil falling to lows at the same time the stock market was following -- falling to his lows. that volatility in the oil market has exacerbated the problem in the financial markets. shery: what about gold? it continues to be under pressure despite the fact that yields are near zero now. david: it has been interesting.

we still favor gold as a relative safe haven in this environment. zero coupon treasuries have been a very good safe haven. treasuries across the board, except for some pricing dislocations as a fed was coming in and other central banks and trying to work out that plumbing, to make sure that first of all, the central bank here, the federal reserve, trying to make sure the plumbing was operating properly so that treasuries function properly here and around the world around that week that ended in march 23, when we saw a lot of pricing dislocations the debt market. treasuries have been, along with cash, the best safe haven. but we think gold continues to be a good safe haven, even though there has been that relative volatility because of margin by. sell what you can, not what you want to sell.

we know there was a lot of that going on. but when we look at what is going on around the world was central banks, where now in the qe. we had a $700 billion program that is now open-ended, what we call q infinity. that was followed on by the ecb, qe program 750 euro that has gone essentially into q infinity. mass stimulus by the pboc. we now have the fiscal stimulus packages coming. all this points to an environment that is very good for gold from a secular argument standpoint. the fear trade we think that is still upon us that we think we will have more of points to gold as being a good safe haven and a good investment going forward. haidi: david, i want to ask you or andne value guidance,

of your targeting uncertain environments. we have this graphic that shows companies have pulled guidance earnings so far. that does not count the ones who have suspended guidance. if you look at sectors, consumer discretionary is hit the hardest. at the same time though, wall street is reluctant to drop its forecasting. expect a 40%they rally by year-end. -- a 14% rally by year-end. david: i think it has a very difficult for them. we came into, or were looking forward to 2020 as finally being the year that we were going to return to profits for companies in many countries around the world, and certainly for the s&p 500. originally if we go back to

december 31, we were looking in firsto 4.5% growth quarter earnings for the s&p 500. that was consensus estimates. earningse down to 7.3% contraction, or negative earnings growth. so that earnings trough we went because of2017, coronavirus and its impacts, has turned into more earnings growth contraction, negative earnings growth going into this year. and that negative number just keeps getting larger. to it will probably continue grow here for the coming couple of quarters. i think it is very difficult for them to forecast at this time because of these unknowns. and until there is more certainty on how long this will last, what it looks like on the other side of coronavirus, when the consumer and how the

consumer re-engages the economy, how we stage workers back into the economy, there's just a lot of unknowns. it is the first time the world and the u.s. has gone through this, so it is very difficult to forecast at this point in time. haidi: yeah, and being such a shock, it is hard to compare to the lessons of 2008. do you still like tech? they were the slowest to fall and quickest to recover. do you expect that resilience to be maintained? david: we do. there was such concern about the faang stocks, the big cap tech, they were a house of cards ready to fall. we have seen the secular growth story we have talked about has stayed there, and that is really what has been resilient through this bear market. and we think it continues to be on the other side. we like tech stocks because they are a secular growth story.

cyclical stocks got hurt in this bear market. so yes, we definitely still like technology, information technology, and the internet. shery: david kudla, thank you so much for joining us. coverageng up in our of the virus outbreak. hong kong executive council convened. this is bloomberg. ♪ is is bloomberg. ♪

reserve's federal emergency rate cut last month seems to be just a beginning. policymakers were already planning to roll out other tools to confront the economic fallout from the coronavirus pandemic. let's discuss that with michelle girard, cohead of global economics at natwest securities. thank you so much for joining us, michelle. so if we are seeing more action coming from the fed, already they have done plenty, what else could they do? michelle: well, you are exactly right that they set the stage for what we already know has happened, which is a whole host of acronyms of programs, lending programs to facilities to support markets and the economy that has fallen. and honestly, there is still

more that could be done. thee is talk about potential for the fed to step in and perhaps continue to help in some ways to support further the bond market or the state or local governments that are going to be facing high borrowing that theyhe same time are seeing revenues -- taking a hit to revenues. perhaps the inclusion of their monetary policy review, which was expected to come in june, we could see the fed take additional action in terms of their monetary policy approach, where they would not only perhaps signal, reaffirm their lower for longer out look in terms of rates by shifting average inflation targeting, but another target that -- topic that keeps coming up is yield control. all these things i think give a sampling of discussions that i

am sure are ongoing, and speaks to the fact that the fed still has more to do, if more is needed. bery: how bad will contraction be here in the u.s. in the first half? and if we do see a recovery soon after, can we really recoup some of, most, or all of the lost output? michelle: so, our forecast is for a very small decline in the first quarter, but a pretty massive decline in q2 on order of about 32% on an annualized basis, far exceeding the worst contraction we have seen in the postwar period, which would have been a contraction of 10%. so we do have a sharp second-quarter contraction, followed by a rebound of about 20% annualized growth in the

third quarter and about 8% in the fourth. and that rebound sounds positive, but in level terms, we do not recoup the lost output. in fact, we basically only regain about two thirds of what we lose in the second quarter. by our forecast, we do not return the level of gdp to precrisis levels until late 2021 , to be exact. the risk oflle, is recovery, where outlook never returns, and ining permanent changes consumers -- how much of a risk is that? michelle: i have to admit i've been more worried about an l-typ expectrio when i did not

such a sharp decline in the second quarter. just statistically, the steep drop in q2, it almost just lends itself to not a complete capital v, but anshaped italicized v. where the right-hand side is a little less pronounced. magnitudetically, the makes it difficult not to envision any kind of a bounce that an l-shape would imply. the other important thing to point out is i had been worried about an l-shape when the risk existed that it could go into a full-blown front -- it started with the bursting of the housing bubble but wound up not being about housing at all but leverage in the system. i was concerned about the fact

that we could see financial stability issues in some markets and the credit space that might take years to work through. and the good news is with the very aggressive action we have seen, particularly from the federal reserve and their support for markets, that concern seems to be eliminated, so it makes me much more confident that this will not be an l-shape type of a situation where it is many, many years before we see any kind of a pickup. the stimulus efforts enough in the u.s.? are certainlythey a good start. if you think about the speed with which we have seen the fiscal response, already it is faster and it is more than what we saw in 2008 and 2009. but will it be enough?

i think we do not know. i believe already we have evidence that ultimately it will not be, because we have already seen actions by treasury and this senate to be thinking about additional relief. in particular, talk of increasing the amounts of funding for the payroll protection program, the $350 to smalln loans business to help them cover payrolls and keep workers employed. there's discussion of adding perhaps another $250 billion on top of what's already been announced. so i think that is a sign that more should be forthcoming, and certainly if the economy fares worse than we expect, if state and local government need more support, there's no doubt we

will see additional stimulus that will be approved. shery: michelle girard, thank you very much for that. let's get a quick check of the latest business flash headlines. an aluminum producer says the endemic is hitting demand for some customers asking to delay orders. some companies in the auto and construction sectors claimed force majeure last month as they sought to delay or reduce contracts. more metal will be stockpiled, and cru group says aluminum demand might drop as much as 30% . starbucks shares fell in late trade, after they were warned of the worst disruption into the third quarter and fourth quarter. sales fell about 3% and he second quarter, while china's lockdown hit eps by as much as $.18.

haidi: we are just getting some breaking news. u.s. airlines are desperate for that $29 billion rescue cash, being frustrated by a long process. more details ahead. ♪

>> welcome to "daybreak asia." i am shery ahn in new york. haidi: i am haidi stroud-watts in sydney. we are counting you down to asia's major market opens and our top stories this hour, the coronavirus maintains its global grip. infections have topped 1.5 million one week after passing the one million mark. oil extending a rally as russia signals it is ready to cut production. opec and its allies are due to meet later on thursday to