happy monday, this is due -- bloomberg daybreak: europe. here are the stories that set your agenda. going at it alone, saudi arabia decides on you lateral one million barrel a day crude output cut for july. u.s. and china defense chiefs fail to instant -- instill a sense of optimism. they are seeking to retain over 100 investment bankers in asia to show up challenge. they may complete the takeover as early as june 12. let's get to those breaking lines that came out just about 10 minutes ago. according to credit suisse, they will complete the takeover of credit suisse as early as june 12. on that day that the takeover is complete, it will be delisting credit suisse.

i think we might have our reporter on this. again, we now have a timetable to potentially see this deal close, it will be june 12 at the earliest. we also saw a scoop say there will be yours earnings delayed up to august. this is sort of a choose your own adventure this morning. did the jobs didn't you more hawkish? did you look at the rising unemployment and slowing wage gains to say they can afford to pause? are you worried about the treasury issue from the one trillion deluge of short-term traders -- treasures coming through the market? for basis point tire.

the aussie three year yields are also trending higher. they are concerned that the rba will be hiking into tomorrow. we are seeing some weakness. traders putting their yen short. let's flip it over and look at the stock change. when it looks at the japanese stocks, we continue to soar above 32,000 on the nikkei. nasdaq futures lead the losses in the american futures session. that is a contrast from friday. at the same time, oil is moving higher this morning. brent crude is of about one point -- 1.3%.

the kingdom's energy minister says they would have to quote it. >> this is a medium barrel reduction that starts the first of july. it is also extendable. you have not been necessarily knocking down doors but doing plenty of doorstops, getting as much access as we can. take me to this opec-plus cut. how are you seeing it this morning? >> you just quoted the numbers. there was a sugar rush and up we went.

she said this is a moment where saudi arabia is backing their words with barrels. what have we got here? unilateral cup of one million barrels per day. that will go live in july. there is a pretty sizable cut, 4% blood rush. perhaps it wasn't built on a coalition of the willing but there would be a reassessment of the african nations quotas. this is a truth and reconciliation moment from many nations under producing. serially under producing against the quotas. for a whole host of reasons. there is a reassessment of the african agent and how they are doing. that would be assessed by independence in the back half. the view from novak was not only, delivering on my 5000

barrels a day cut but we will continue to get through 2024. it is a cut, reassessment and it is implicit trust in the russians. good morning from vienna. >> talk me through this for the uae. >> come with me and stay in the fold. that is the takeaway for me. the others have long wrangled with the fact that they have been cost in their ambition and their production targets. the, roddy has an additional 2000 barrels per quarter. they go up to 3.219. never forget the 19. here's the thing. how did they get extra quota? they got it on the african nations really dealing with the truth about their quotas. when i put that to them, the

response? >> those countries have all accepted limited production. they have been given the chance until the end of november. >> before that, he said that is not the way to reassess this. this was a gift from opec to them. i was i didn't want to run the risk, the iraqis. here is the politically difficult pill to swallow. the uae leaving cup 28 has just been given the ability to produce more as they go to them as the world to do carbonized.

irony. >> certainly irony. i could use a lollipop this morning. i could use a bit of a sugar rush. >> fantastic reporting there. you will continue to cover the opec fallout for us. elsewhere in the world, the highly anticipated form and singapore started with a handshake between the u.s. and china defense officials. there was the only son of optimism at the otherwise brought event. this engine to achieve joins us now. tell us more about the u.s. and china. you could be optimistic but perhaps not. >> i would say that it was very limited interaction after that first one. the reality is as the talks went on, the pentagon were not

agreeing on direct bilateral talks. the defense chief is being sanctioned over weapon sales. during the meeting, china's defense minister responded as well. basically retorting the remarks. the reason is because in some ways, china does not really see talks right now as being productive because there are so many issues to disagree over in this part of the world. what is taiwan? the fact that there are a lot of u.s. military activities around china. >> what else was said? >> i would say in some ways, i think china has come out of this dialogue a little bit better. >> he did talk to the defense minister who has agreed to visit

china. he is the one who said that talks with china required productive. he said he also spoke with the japan defense minister and he said those talks were actually pie cordial. based on the fact that china -- on the issue of ukraine, it looks like you have more conscious agreeing to the chinese perspective. now russia can leave its troops there. that is sort of transposition. >> have this in singapore, there are some mornings from them. in terms of being around work, what sort of urgency did you take from singapore's warnings?

>> there is a good deal of concern. there is concern that the same thing could be happening in taiwan. the last thing they want is a two front war. when ukraine and one in asia. >> coming up on the program, strong economic data has full -- fueled optimism that central bank may avoid a recession. we will discuss that next. this is bloomberg. ♪

not >> let's get you set up for your trading week and look at what we will be looking out for. we will be getting usm services dated for may tomorrow. it is the rba rate decision that will come in and then on wednesday we will get the kind of trade data followed by gdb on thursday. here to help us set up for the week is valerie tytel. before we can get through all of

that. the concern at this moment seems to be this tsunami of short-term debt that will need to be issued by the treasury to make up for the deficit they have at the moment, do we care? will this impact markets? >> that is the question. i think a lot of this has been over telegraphed. you have equity strategists. in some way, you could argue it has been over talked about and may priced in already. we will be keeping an eye on thursday for the auctions that the u.s. treasury will announce. they will announce their three year and a 30 year for next week. this all goes back to the problem that the treasury is holding around 20 billion of cash on his balance sheet and it was only just a regular it held around one trillion. just how quickly will it increase auction sizes?

how much of a liquidity crunch if they do go about it in a quick member -- quick matter will that cause for broader markets? i have to say i have heard a lot of disagreements with a quarter-point hike. the only thing that matters is the path of the fed. we will get the rba. could we get another surprise hike from them? >> this will be the most interesting central bank meeting of this week. with the rba, it is a special case. two months ago they decided to pause interest rates and surprisingly hike last month. you can see these instances where they are trying to catch their tail. deposit rates only a 3.8%. even the reserve bank of new zealand, they did say they were going to pause and likely hike further but they are at 5.5%. all of these factors and then you have to take into account we

get increasingly hawkish comments from rba governor low. this set a pretty high bar of 5.3 quarters -- 5.75%. you compare that to the cash trade and they might have some work to do terrain and inflation, that will be the key one for me this week. the rba decision overnight tomorrow. a third of economists are now calling for a hike. questions the other thing this week. it is china data. this narrative has really shipped from china to taking away from it. what are you looking out for? >> the export and import data will be key. i want to know just how big the export engine of china still is. a lot of speculation that they will not be able to have this economic growth driven by this export model and then on friday

we get cpi and ppi, a possible slowdown in china. it could be deflation for the rest of the world. we will see if those numbers will start school on china friday. that is our markets reporter. coming up, we are at the conference with global aviation giants. this is bloomberg. ♪

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>> let's talk about the air industry, the world air transport summit is underway in istanbul. we are speaking with executives about the outlook from the second half of the year and beyond. scott johnson is there with the guest. >> you were just talking about

services, they are superstrong right now. the airline is seen some of the best demand it has ever seen. the question is if the current super strong demand is sustainable. these are the brands he has under his umbrella. nice to see you. demand is superstrong. it is sustainably superstrong, what this carry-on? >> every morning. when we look at q2 and q3, demand is superstrong. the? can be q4. we'll see any witness in the forecast. >> this is premium leisure travel, this is not business

travel. quest that is upsetting the lack of corporate traffic. in letters of 70%, the volume of corporate traffic is around 80%. is taking time. we have different realities in different markets. spain is going back to the office sooner than other people in the u.k.. >> i think when we see the forecast, we see people want to fly. we see very strong demand.

>> i suspect there are multiple ranges of factors coming in here. mostly that there are aircraft shortages. maybe you don't have an engine to go on it. how big of a problem is that right now? boeing's supply amended right now. how big of a factor is that? >> we are having the same problems, the liberty aircraft from boeing. for this year, we expect to have a new aircraft. we will have the delivery. we are thinking of the future of all the aircrafts that we will have delivered.

>> one of the issues that you had experienced recently with british airways is i.t. outages. >> yes. >> will this carry-on? will the i.t. system be up to this somewhat? >> we are missing a lot of money and i.t.. it is taking time. it is a process. in the meantime, we are trying to be resilient. i think that during the last three years, the investment was huge. this summer, more broadly, disruption, we would see as much as last year? >> i think it will be better.

strikes are not helping. we have 34 days of strike. 30% of the flights in france or overfly france. i think it is important that we can monitor that situation. >> in terms of what comes next, you would like to potentially an europa. confident were now? do you think regulators will take all the boxes that need taking? we are trying to do the operation. it can take 18 months. we are not sure that is the right thing.

that is the group. >> let's talk about other opportunities. we talked to ben smith yesterday as well. then is interested in thp. they just got out of italy. >> we are looking at opportunities. that process just started. that will be based on opportunity for sure. we need to see how it will be in the market. >> does this make a difference in terms of share price? the other airlines within the group have been doing fantastically.

british airways, no problems. how do you change that? this is our main asset. the q1 results performance was very good. we have other opportunities for us. we also have maintenance. back to you in london. because that was guy johnson in istanbul. i love some of that.

i don't know why airfares were so high. we are going to have much more in terms of interviews. i will be speaking to a whole host of people. stay with us. coming up, saudi arabia says it's one million barrels a day supply cut will be a treat for traders. we will be talking about oil next, all of this as some of the gain start to pay her back. this is bloomberg. hi, i'm jason and i've lost 202 pounds on golo. being a veteran, the transition from the military into civilian life causes a lot of stress. i ate a lot for stress. golo and release has helped me with managing that stress and allowing me to focus on losing weight. for anyone struggling with weight and stress-related weight gain,

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let's welcome back to bloomberg daybreak: europe these other the stories that set your agenda. going at it alone as saudi arabia decides on the unilateral one million barrels a day outlook cut on july to stabilize prices. oil pairs every -- early gains. the u.s. and china defense chief failed to instill a sense of optimism that the two nations could smoothly bridge the strategic differences. we are hearing ubs is seeking to retain investment bankers in asia to shore up talent. two yields continue to move higher this morning. whether you care about to lose of treasury issuances or jobs that continue to surprise to the upside. that is the net effect of what we are getting. higher by about four basis points today. you have to see the rb i -- rba

hike once again. the yen continues to weaken. we are past 140 per dollar as shorts gold up on that. not the most extreme of the year. may be buried on the n. we got some data today that showed pmi services looking stronger-than-expected. tourism is strong in japan. japan is surely taking the reins. of 2% on the nikkei. that is at the highest level since the 1990's. some of the tech optimism starts to come in just a tad. we are down .4%. merely reacting to the higher end on the front. i am skeptical that is what is brings hike in this morning. maybe some profit taking and s&p 500 futures are moving well this morning. one note that caught my eye from

morgan stanley over the weekend, putting a very bearish note on there when it comes to profit from the s&p 500. dps is coming into about $185 per share by the end of this year. i think we have a full screen on that. this is not morgan stanley's own eps. it is the s&p 500. it sees it coming in at 185. that would imply a 17% drop more or less. that is the kind of financial crisis typo back. they are one of the rare people to see that. the estimate is $204. morgan stanley really standing alone in this bearishness. are they seeing something else out the rest of the southside does not see? let's talk about the oil picture. saudi arabia says it will cut an

extra one million barrels per day of oil in july. taking his production to the lowest level for several years after a slide in crude prices. the uae secured a higher quota for 2034. the rest of opec-plus pledged to make existing cuts until the end of 2024. let's get to the founder and ceo of crystal energy. carol, when it comes to saudi going at it alone, how much of that should be the focus? many were expecting some production cuts. i am just trying to get my head around it. the fact that it was for one month.

was it a shot in the dark or a meticulously analyzed step? you can argue both ways. there is also the argument of civilizing the market. i also see it as a gesture of goodwill or a leadership gesture from saudi arabia which is equally concerned about the stability of the group, of the class as it is concerned about market stability. in that respect i see it as an important step to bring everybody on board. >> on the idea that it is also form of price stability, there is a signal that saudi arabia is willing to step in should we see any sort of downward price spiral in oil. >> probably. will have to wait and see. we will see the loss of one million barrels per day.

that will bring their production to 9 million barrels per day. if they succeed in increasing prices, you can translators higher levels since they are guarding market share. if prices continued their downward spiral and they don't go upward, all the forecast will be about a tighter market. strong economic growth. >> that is what i wanted to get. just how possible is it to stabilize this market? how difficult is the task of price stability? the u.s. looks like it is heading through tort a recession and europe continues to do a

supply issues. just how difficult will this task become for opec-plus and the saudi's in the second half of this year? >> the challenge is what we have been seen since the end of last year. that is why we are all watching closely everything they say and do. they are not the only mover and shaker. after all, you do have oil supply. you also have the demand. one, the higher prices and we saw something but also through the economic outlook. this is still on the doorstep of europe. in a nutshell, opec has many challenging tasks to stabilize the market given the existing fundamentals and geopolitical

realities. we don't know where prices would have gone if they did not step in and achieve stability in such a complex market. it is a very challenging step. >> does is cut up help? >> what? >> does is put a floor on prices? >> every single country has certain expectation. people typically use physical breakevens. if you look at the imf, they say that saudi arabia is using the price to balance their budget. i don't put too much emphasis on their price. you can easily run this with the budget deficit. like any producer, you don't

kill the goose that lays the golden egg. for the rest of the year, you know i shy away from this. i would expect that to continue. >> it is extreme the sensible of you. before we let you go, we have to end with these three words. whatever is necessary, what is your take away from that commitment to continue to lean against speculation in this market? >> it reminds me of the famous central banker. this is what saudi arabia has been trying to portray for years. they want to be the central bank of oil markets. that said, if you really want to

be the central bank of oil markets, you should avoid keeping a on their toes. they would like to continue to be the central bank of oil markets. coming up, ubs continues to overtake. we will discuss that next. this is bloomberg. ♪

>> we have a new date for when ubs might be completing its acquisition of credit suisse. that would be as early as june 12 according to the bank early this morning. let's get into this with russell

ward. june 12. walk me through the significance of that. >> this seems to be good news for anyone who is concerned there were delays in this process. we know the bank wanted to complete this by the end of may. they have now bound themselves to republican statement saying that it would be at the earliest one week from now. remember, this is also completing the completion of the deal. this is something that will take a long long time. >> to that exact point, russell, there was a story out over the weekend about a delayed second-quarter quarter results. is that just a factor if that is indeed what happened was to mark >> absolutely. that is what they are saying. ubs is scheduled to show

earnings by the end of july. they had a couple of months according to accounting rules. they wanted to use the 60 day time to make sure they have everything sorted out. one is the issue over whether the government will incur any losses. they are wondering if the taxpayer may have to incur it. that is regarding the swiss banking. that is also usually confidential -- controversial issue in switzerland. they may actually delay reporting of the earnings to coincide with an announcement i want to do with that swiss unit. bearing in mind there is a lot at stake with jobs and branches. there are very sensitive issues that the bank needs to work through. there is one other practical issue. credit suisse and ubs have different counting systems.

there are some practical issues there. you have to work through those as well. >> your bringing me back to different kinds of reporting. i don't envy the people at ubs who have to handle that one. make you so much, that is bloomberg's russell ward. nellis get to a bloomberg business flash. this is adrian wong. >> the u.k. remained europe's top destination for foreign investment projects in the financial services sector last year. britain landed 76 investments in 2022. more than a quarter of all projects. france the second biggest recipient. at 25% drop in projects. germany and spain with the third and fourth most important destinations.

turkey has named his treasury and finance minister. they will face the challenge of restoring investor confidence after the election. an advocate of conventional policies signaling a shift from herod want unorthodox positions. airbus is the wide-body aircraft market is set to experience lengthy wait times similar to the single aisle segment. that is after rapidly stocking up. the wide-body aircraft generally more complex due to elaborate interiors. that is your bloomberg business flash. >> coming up, everyone from sovereign wealth funds, venture capitalists are talking about the new favorite as a class. ♪

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>> things are really busy. we had a great memorial day weekend. >> we are seeing her leader customers and the strong as part of the market. i think the priorities here have shifted in a crisis where travel has gone higher up. all this in order to fulfill something a little more sensitive than other industries.

question opening in january. it is actually a bonus. we were factoring in this in the second half of this year. the levels of growth we are seeing are very encouraging. i think china is a market that will be impacted by a number of factors including the russian space. that is clearly putting pressure on europe and china. quick speaking at the iata agm in istanbul. we'll have plenty more interviews from the conference today. that will include the virgin atlantic ceo live from istanbul. it had bent the golden age of private equity but as returns fell the first time last year since the financial crisis, is the new favorite child of

private markets with banks stepping back? the asset managers joins us here. i have been talking about private credit for a while with the team here. he did feel like this team -- this thing that was really news. with banks stepping back, it is the new hot place to be. who are the new players here archery us into this golden era? >> the short answer is everyone. you have credit funds that are still doing it but then you go to more established players asset managers like dws for the private credit unit. >> softbank entering the game does not instill a lot of confidence. how set up are these people to be doing private credit?

>> a lot of hiring going on. there has been a lot of movement of people around setting up these funds. how prepared they are will show the downturn because the issues are those prepared to finance companies in the downturn hopefully they are. >> it is really interesting. you have the banks pulling back on the public market sector. you have these private players and stepping in. when private equity is struggling, surely private credit can be fun but is better now. >> not necessarily because we are not a very different economic backdrop. people are a more cautious when they put this here. they have more questions. they vetted more.

there are a lot of new fans raising money. if you look at the data. it seems like everyone is flocking to the people they now. i think the first quarter of 2023, there were the last one closed since 2017. everyone is flocking to it but is not necessarily that easy to raise a fund right now. >> that is a really interesting point. we're talking about private credit, what does that mean for future growth? are we near a peak? credit is now one point $5 trillion. it has trickled since 2015 -- this is where everybody is seeing an opportunity. it has been revised short-term.

it will probably be more like 1.8 trillion. fund managers do see an opportunity but at the same time there is pullback from the other side from investors. i know in the public markets, especially in the u.s., we have started to see a slight pickup of more defaults. is there any sign of that or other risks for investors? >> definitely is. higher interest rates are more lucrative for the fund managers. when interest rates go up, they can make more money. but defaults would also go up. there has been an update. there are more defaults now than there were a couple of years ago. to give you an example, blackstone end couple -- capital have been hiring in-house restructuring experts to be able to deal with the downturn because -- that is why investors

are cautious and they are flooding back to the more established players. maybe they have great teams but nobody knows if they will be able to deal with that if things go south. >> that i find so interesting. ultimately these are dead investors. they won't want to out right on the company. >> it depends. we have to see. we have not seen a situation like this. we have had qe for more than a decade. whoever was around in the financial crisis -- it would depend on the contracts. a fantastic piece. that was our bloomberg asset management reporter. speaking of private capital, we will be in berlin this week. we will be heading along.

the world's biggest private capital conference. that will include carlisle, scott, orlando and michael. now let's get to the first word news. that is adrian wong in hong kong. >> nds as a faulty electronic scheduling system was the cause of its worst rail disaster in nearly 40 years. the search for survivors has ended with 288 people dead. indian railways says or -- more than a thousand staff our work to clear the wreckage while a high-level inquiry gets underway. saudi arabia will make an extra one billion barrels per day in july, taking his production to its lowest in years.

russia made no commitment and the uae secured a higher production quota for next year. the coalition pledged to maintain existing cuts until the end of 2024. hundreds of thousands of people have marched through the streets to show their support ahead of october's policy elections. poland's ruling law and justice party has been criticized by the eu. global news, 24 hours a day on air and on quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. that is it for bloomberg markets. ♪