it's an amazing thing when you show generosity of spirit to someone. and you want people to be saved and to have a better life, then you don't stop. the idea that we have saved five million people's lives, it's overwhelming. it's everything. >> good morning, happy monday. this is "bloomberg daybreak: europe." kicking the can. u.s. futures again after

congress narrowly averts a disruptive shutdown, keeping the government running until mid-november. buying bonds. the boj announces another bond buying operation this week. plus, taxing time for rishi sunak. u.k. prime minister plans to untie his party despite senior colleagues calling for senior tax cuts -- calling for tax cuts. we have a host of big interviews today including chancellor jeremy hunt and the jp morgan ceo, jamie dimon. first to the markets, it is a relief after the worst quarter for equities since 2022. the relief this morning is thanks to the fact that we have averted a government shutdown, but how long can that last? 45 days into we will have this shutdown debate again. most of the relief from large cap tech. nasdaq futures up 7/10 of 1%. this is not unusual.

the bad news for equities is yields continue to march higher. the bond market selloff continues. maybe now that we don't have a selloff, may be the impetus isn't to buy treasuries. let's show you what 10 year yields are doing. back above 4.6%, at cycle highs again. of course, that pressure from higher yields often needs that use -- bad news for the end. -- the yen. the expectation on a one-year scale is 2.5%, not great news either. brent crude continues to move higher, above $92 a barrel. we are away from shutdown but you still have the risk of higher oil, you still have strikes, student loan repayments, treasury supply. the fear is not gone from the market. at least china isn't trading,

that gives us some leave. that's check on the rest of the asian markets with avril. avril: we are looking at how asia stocks aren't giving us too much direction. the msci asia pacific has been flat for much of the session. we got the early bump on the nikkei after we saw that sentiment is improving for manufacturers and non-manufacturers. part of that is to do with the cheaper japanese currency. we did get the boj announcing the additional bond buying operation set for wednesday. that is a bearish yen signal. we are also seeing how we are getting those chinese pmi numbers from the weekend and investors are still digesting that bit of information perhaps. some optimism in the form of the official manufacturing pmi,

which surprised with a bit of expansion for the first time since march, what just by a whisker. there was cautious optimism because on the tyson numbers, there was a slowing. we might see these exporters in china still facing heavy pressure and enough to keep economists and investors on their tubes -- their toes. dani: thank you. let's get to our top stories of the day with our reporters around the world. joining us is bill in singapore, valerie here in london, and lizzy in manchester. we have to start with the deal that was made late hours, to keep the government running until november 17. it may come at a heavy political cost to house speaker kevin mccarthy. let's bring in bill on this.

first off, what was agreed, how long does this keep the government running? bill: well, we've got another basically about six weeks or so for u.s. government funding to be in place and for lawmakers from both parties to find a deal. what they kept out of this agreement were some things democrats really wanted, or most wanted, including increased military funding for ukraine, but a lot of the spending cuts and other issues republican hardliners had ben holding out for were left off of this. it was a compromise i think for both paries. there was a lot of late-nit negotiating patly because democrats said they needed time just to read the bill. you had basically a short filibuster taking place on the house floor while kressa scrambled to see if this was something they could support. it was clear quite a few republicans would not be backing speaker mccarthy on this proposal. dani: this thing was like a soap

opera. you have a congressman pulling a fire alarm to buy time. it was wild. you have comments from kevin mccarthy saying stuff like come at me, bro, i am willing to gamble. i want to be clear that is paraphrasing. is his fate in trouble with getting this done and having so much democrats support to do it? bill: well, yes, in the sense that there is likely going to be a showdown over whether he remains speaker of the house. it's not clear how that will play out. it is a very small minority in his own party that is frustrated and looking to replace him. one congressman, matt gaetz of florida, has said he will call for a no-confidence vote. the challenge people like matt gaetz and his allies have had this whole time is there is still no clear placement to

kevin mccarthy as speaker. it's hard for them to rally around any other candidate, even if they remain frustrated with the speaker. the big wildcard is what the democrats do. if they swing their vote behind a small group of republicans, they can oust mccarthy and leave the house of representatives in turmoil. it's not clear what are they would do that or not. i think mccarthy wants to have the showdown now and hopefully end it for future issues, including the mid-november showdown over the budget where we might be back here talking about last-minute theatrics once more. dani: the fun never ends. thank you, bill. as i mentioned at the top, stocks are rising after the government shutdown was averted for now. let's talk to valerie about it. at least for now, i feel myself saying it and there is so much

on the horizon that is so risky despite this. valerie: it's just a pop we will get in s&p futures on this shutdown, because i look at the bond market and there is no good news, the treasury selloff is continuing and that will be a headwind for risk assets leader -- assets later in the week if we have another week where we hit cycle highs again across the curve. if we had shut down, we might have snapped the rally. we are seeing the treasury curve four basis points higher this morning. i don't think that's great heading into this week. have treasury auctions, ism surveys, and payrolls. all of the data tempting treasury yields higher and cycle highs again. maybe the pop in risk assets is short-lived. dani: you see that globally,

specifically in japan, the impact higher u.s. yields is having. valerie: exactly, the yield differential between treasuries and jgb's, is tempting the yen to move weaker. the bank of japan intend to hold another unscheduled bond buying operation. if they try to hold these yields down amid the surge in treasury yields, the yen will continue to weaken. it is very close to coming up to the 150 handle. dani: it feels like relief in equities but panic everywhere else. valerie, thank you. all right, let's talk about this country, the u.k. the conservative party annual conference in manchester is underway and prime minister rishi sunak is expected to use this a set of his agenda ahead of the general election expected next year. let's go to our u.k. correspondent. what is the prime minister

hoping to achieve with this conference? lizzy: of course this is rishi sunak's first conference not only is party leader but as prime minister. short of manifestoes, this is an opportunity to sketch out the landscape ahead of that general election, which as you say, he needs to call byjanuary 2025. he's got two bg games, to unite his party and to show how he would do the job other than the labour party. he's focused on the long-term decisions for a brighter future. today the focus is on business and the economy, and the highlight will be a speech by chancellor jeremy hunt at 2:00 p.m. we will grab him for an interview at 7:40 a.m. the pressure is on to deliver tax cuts before the general election. what we are expected for him to focus on today in his speech, cuts to welfare and arise in the living wage to incentivize

people back to work, to get on top of the economic in the to problem. the trouble is, we are in a cost-of-living crisis in the u.k., so it will be controversial to cut benefits but also to make businesses cushion the blow. dani: thank you so much. our bloomberg u.k. correspondent. in just over an hour we will be speaking to the u.k. chancellor, jeremy hunt. don't miss that. a quick look at what is ahead for the day, we were talking that china markets will be closed. will we have any bump to travel? we have u.s. ism data coming out and then we will hear from the man himself, jay powell. there is a lot of fed speak this week. do they need to change the narrative? you can get all the stories to get your day going i today's issue of daybreak.

it is available on the terminal. coming up, we will speak to the ceo of halliburton live from a conference in abu dhabi as oil prices climb ever higher. this is bloomberg. ♪

dani: it is your monday addition of "bloomberg daybreak: europe." an energy conference is underway in abu dhabi. yusuf is there with a guest. yousef: thousands of executives are gathering here at one of the key summits for oil and gas. we are pleased to say we are joined by one of the top executives in the lineup, the ceo of halliburton. thank you for joining us on the show.

let's get straight to what's going on with wti, because we are north of $90 a barrel now and there is this lingering anxiety around whether consumers can deal with that, not just in the u.s. but around the world. are you worried about tightening conditions and maybe over tightening? jeff: look, i think oil and gas probably is tight and that is growing demand. we see growing demand and expect that to continue. as far as over tightening, i think the price of oil is going to be a function of supply and demand. i think what we are seeing realistically is it's difficult to produce oil and gas and i think we are remembering that or realizing how difficult it is to produce oil and gas. particularly as north america wrestles with where their

production will land. meanwhile we see lots of activity around the world. yousef: will we see triple digit oil prices soon? jeff: i always get that question wrong so i will stick with what i am seeing. if we look around the world, there's a lot of support for oil and gas, particularly oil price. below $70 never made sense to me given what is required to produce oil and gas. i think we will continue to see tightening. yousef: let's look at the feedthrough mechanism in terms of the psychological impact of oil prices, close to $100 a barrel, in terms of when two clients decide to boost spending? jeff: i think we will decide -- i think we will see more activity in 2024 in north america and nationally. we will see that manifest as we work through the year. yousef: i look through some of your peers.

they are pushing through with quite a bit of diversification outside the united states. compared to them, you still have quite a large presence in the u.s.. how do you find the right balance in sort of that asset allocation? jeff: we let returns allocate our assets. we put assets where we make the best returns. north america is a very good is in us for us. we take a very different approach. we grow profitably internationally and we maximize returns in north america. a lot of the things we are doing in north america are very successful certainly for halliburton. at the same time, more than half our business is international today. we see solid growth and a very tight outlook internationally. yousef: do you have a preference on where you want to double down going forward or do you want to maintain that balance?

jeff: we manage the returns, so north america again is a very successful business for us. we put capital into that business as we are able to maximize returns on the assets. in that case, mostly electric. e fleets are successful for us in north america and it is a very different dynamic. at the same time, probably overweight in terms of capital into our international business just because of the opportunity set see and also the terrific technology we have brought into the market, particularly around drilling and logging while drilling in a reservoir. yousef: how much of a pushback -- not pushback, what is the debate among clients about raising service fees here? jeff: i think service quality

and efficiency underpin everything we do. he always start conversations around how efficient and how effective are we? beyond that, there is a recognition that the equipment is tight around the world. we are focused on returns and returning to shareholders the same as our shareholders are. i think we have a different dynamic in the oilfield today than we possibly ever had, discipline in capital investment by clients and us, and generating returns over the long term. i think we are at a place where we can do all of that and i think our customers understand returns are what are required in order to invest in research and development and new technology. yousef: the other thing i am trying to find out is what extent you see inflationary pressures build up. maybe it is on the labor side rather than the service side, or

may be the worst is already past. the fed indicated they will potentially hold rates higher for longer. that could help kind of craft, not to say what the fed will do, but what halliburton will see. jeff: i think we still see inflation, not like before. last year was a year of hyperinflation. are inflation outlook is certainly not what it was. but inflation around people is consistent with the rising interest rates we see. we also see inflation around technical equipment, particularly d.c. boards and to a certain degree chemicals. we are seeing inflation. clearly our customers see that inflation also. yousef: i look at the productivity of some of the shale activity and some of the people i've been speaking to suggest that could be a positive thing for halliburton. do you agree? jeff: i would agree with that.

i think it is more based and service intensity. the effort required to produce oil and gas in north america. we've seen rising service intensity, the amount of horsepower, sand, inputs require in order to grow production in the u.s.. i think that is may be dynamic that has changed globally because probably for the last decade, every incremental there'll of demand has been met easily by an incremental barrel of the u.s. supply and i don't think that will be the case going forward. yousef: it has been fantastic to chat, it's been about 18 months or so since we were on a panel somewhere in saudi arabia. that is jeff miller from halliburton. we have many more voices through the morning across the industry. for now, back to you. dani: it will be interesting to see if they agree that the market will continue to tighten.

thank you. yousef gamal el-din in out of dobby. more to come. this is bloomberg. ♪

>> look, we all have opinions. i've been saying for a year -- >> i want to know your opinion. >> 10-year rates at 5% or higher because of the embedded inflation. this structural inflation is unlike anything. i think business leaders and politicians are not providing the foundation to help explain this. we have not seen inflation like this in over 30 years. i was a young bond trader during the late 70's and we had

hyperinflation. i don't think we will have anything close to the inflation of the 1970's that we have so much deeper structural inflation. we are underestimating the change in geopolitics, it is so structurally inflationary. when i was in davos earlier this year, i heard the phrase "national security" uttered everywhere. and i had never heard those phrases that often. national security for chips or food or energy. and all of these issues and the question is at what cost? nobody answers that question. >> there are a lot of calls of a recession and they've all lost their meaning at this point. in this era of fear and no hope -- >> it is not no hope, i am

hopeful. >> larry is hopeful. but doesn't mean we are headed for a recession? >> i think we have to analyze by each region because united states, our home mortgage market is based on a 30 year mortgage. anybody who has a home mortgage, higher interest rates is not impact them. the transmission of high elevated interest rates in the u.s. takes much longer to impact the economy. whereas in other places where you have more floating rates, or like in the united kingdom where you have generally a five-year fixed and then it resets -- let's assume 20% of the mortgages have to be reevaluated at a higher level -- that creates more immediacy. i think we will see some economies enter recessions early. dani: which ones would that be?

larry: the ones that are more sensitive to elevated interest rates and you are starting to see a real decline in gdp -- they are basically flat now but can they go into a more protracted recession? whatever the recessions we will have be modest. i'm not even that fearful. dani: i have a step -- larry: let me say one thing. i believe if we have labor shortages, and getting back to the whole social issue of how are we going to be doing this, in many areas you may need a recession to bring down labor demand. i think this is one of the things that is going to impact the united states. you still have a very vibrant economy, the united states -- the infrastructure act, the chips app, the ira, which has huge implications, will be creating jobs good it may require a more protracted

federal reserve and it may be by 2025 the u.s. economy will be entering a recession but i do not see it in the near term. dani: that was my conversation with the blackrock chair and ceo larry fink, who says if we get a recession, it will likely happen in 2025. coming up, we will discuss one cause that will not be happening for recession, the u.s. averting a government shutdown for now and what it means for future aid to ukraine. this is bloomberg. ♪

it's an amazing thing when you show generosity of spirit to someone. and you want people to be saved and to have a better life, then you don't stop. the idea that we have saved five million people's lives, it's overwhelming. it's everything. dani: good morning, this is "bloomberg daybreak: europe." i am dani burger with the stories that set your agenda. u.s. futures gain after congress

nearly averts a disruptive shutdown, keeping the government running until mid-november. the boj announces yet another bond buying operation this week as it hit another decade high. plus, taxing times for rishi sunak. the u.k. prime minister attempts to unite his party despite senior collies calling for immediate tax cuts. we are live from the conservative conference in manchester. we have a host of big interviews today, including jeremy hunt and jamie dimon. so a shutdown averted for now, still in 45 debase -- days the debate will be reinvigorated. a pop in futures this morning but will it last? i guess it didn't even last for europe, as i say this, we are in the red. s&p and nasdaq futures march higher. one thing to keep in mind are the many shocks. on friday we learned the auto worker strike will be expanded to 25,000 workers. it's also oil prices, student

loan repayments and a lot of potential shocks that could coalesce at one time for this economy. we are selling bonds again. back up, higher about four basis points. also putting pressure on the boj and japanese yields along with stronger data out of japan. we will talk with our reporter on that in a moment. we are back at intervention area levels, and then brent crude is also marching higher. $92 a barrel. yousef was talking with a halliburton ceo saying oil markets will continue to tighten, not great for those who hope inflation will continue to look like last week for the europe and u.s. that's get over to avril. i know china is on holiday for golden week, how are the rest of the markets doing? avril: not seeing that much direction as far as the msci

asia pacific is concerned, because as you say, china, india, hong kong markets are shut. there is the sense of optimism, though, from the japanese gauge. but itpared some earlier gains as the manufacturing and nonmanufacturing data showed improvement. a lot of this was the relative cheapness in the japanese currency. we did get the boj announcing an additional operation for wednesday, a bond buying operation, which is seen as bearish for the japanese currency. we have investors digesting pmi info out of china, the official manufacturing pmi showed expansion for the first time since march if you look at the tyson numbers which tends to give more indication of what

private businesses are facing, we saw a slowing. there is cautious optimism that we are seeing the chinese economy find a bit of a bottom, a signal it is finding its footing but still we have to digest the data points a bit more. dani: a lot of data not just in china but in the u.s. throughout the day. thank you. the deal to avert a shutdown of u.s. federal agencies will keep the government running until november 17, but the stopgap bill does not include additional funding for ukraine. president biden urged house speaker mccarthy to follow up quickly with support. >> i fully expect the speaker to keep his commitments to secure the passage and support needed to help ukraine as they defend themselves against aggression and brutality. >> i support being able to make sure ukraine has the weapons they need but i firmly support

the border first. we've got to find a way we can do this together. dani: joining me now is bloomberg's bill faries. bill doesn't have sound at the moment so we will get back to him in a little bit. bill doing some great mining. -- miming. some of the top questions, what does this mean for kevin mccarthy? did he sacrifice his speakership to get this through? other top stories, the ford ceo has accused the united auto workers of holding talks hostage over issues not ever and by their contracts. the strike is entering its third week with negotiations pivoting to the more existential issue of workers in electric future. they want guarantees for those who make engines and transmissions. in turkey, turkish warplanes

reported to have carried out a number of airstrikes on suspected kurdish militants in northern iraq. officials say it is in response to suicide bombing near turkey's interior minister building in ankara yesterday. sunday's suicide attack happened hours before turkeys parliament reopened its three month summer recess. slovakia's general election has been won by a former prime minister who criticized eu sanctions against russia. he is also promising to end military aid to ukraine, delivering a fresh blow to western unity. he is on track to return to the premiership. all right, let's focus on politics in the u.k., because she sunak's effort to unite his mp's ahead of the next general election is proving challenging. that is happening as the u.k.

prime minister resist calls for immediate tax cuts. let's get to our u.k. correspondent, who is at the tory party conference what is rishi sunak hoping to achieve? lizzy: rishi sunak and his front have been on the airwaves trying to get credit for the economy. growth has been better than the argument is they have steady the ship and they want to focus on what they call long-term decisions for a brighter future. that is the slogan. in the gift shop they are selling these flip-flops. painting rishi sunak in contrast. the reality, we've got an election coming, it has to be called by january 2025 so inevitably the focus has to be on the short term. this promise about the long-term

is already for many ringing hollow. repeatedly, given the chance, the prime minister has refused to commit to a high-speed rail network that connects this part of the country even faster. the other thing and tells us is how much rishi sunak is limited when it comes to putting his own stamp on the conservative party and the nation as well because the further he strays from boris johnson's 2019 manifesto, including this commitment to level up britain that was central to the manifesto, the more rishi sunak's mandate comes into question. remember, he wasn't elected by the public and he wasn't elected by his party. dani: can you hold those flip-flops up again? we didn't get a good look at them and i think people need to see them. [laughter] lizzy: the question is, how much would you pay for these bad boys? dani: i feel like they are

priceless. would you wear them to the beautiful beaches of the u.k.? [laughter] what are likely to be some of the main controversies? lizzy: i talked to you about hs2 , which is not well-timed. we are in the north of england. the other is tax cuts, mp's in the conservative party are clamoring for them before the general election. not necessarily expecting them in the budget coming soon but they want them to commit to some stage before they go to the polls. it is business of the economy day today, and the highlight is expected to be the speech by jeremy hunt, we will speak to him at 7:40 a.m. his focus is not expected to be tax cuts. the prime minister is not

putting his cards on the table when it comes to tax cuts. >> the best tax cut that i can deliver for the british people right now is to halve inflation. inflation is a tax that impacts the poorest people most. lizzy: what we are expecting the chancellor to focus on today are cuts to welfare and a rise in the minimum wage. the controversy will be why are you cutting benefits in a cost-of-living crisis and putting the onus on businesses to cushion the blow? dani: thank you. also cannot wait to see the other swag you pick up. lizzy at the conservative conference in manchester. she will be speaking with jeremy hunt at 7:40 a.m. let's get back to the u.s. government shutdown, they have averted one until at least november 17. let's bring in bill faries, who

now has sound and is ready to go. shutdown averted was it at the sake of kevin mccarthy speakership? larry: possibly -- bill: possibly. that's something we may see play out this week. one key florida congressman has said he will call for a no-confidence vote in speaker mccarthy. the challenge he and his allies have is there is no clear replacement for mccarthy at this point. this is why it took 15 rounds of balloting for mccarthy to get the job in the first place early this year. without a clear replacement, it is not really clear what will happen here. a lot may depend on the democrats and if they throw their votes behind a small group of republicans seeking to oust the speaker or if they step aside and let the republicans have this civil war among themselves. dani: elsewhere in d.c.,

california governor gavin newsom has tapped someone to fill the late dianne feinstein's senate seat. is there controversy around this appointment? bill: a little bit brewing. we will have to see if it has legs. she is best known as the head of emily's list, a group that works to get democratic pro-choice women elected to political office. as part of that job, she lives in the washington, d.c. area and owns a home there. she is registered to vote there. she is not actually registered to vote in california. governor newsom's office is a saying that is not a big deal, she owns a home in california and she will be reregistering back there. but it will be interesting to see how this plays out the next few days. dani: yeah. it is, again, somewhat historical. she is just the third black

woman in the senate in history and currently the only black woman in the senate. thank you, bill. a quick look at what markets are watching this week, 3:00 p.m. u.k. time, we will get u.s. manufacturing data. the fed chair will take part in a roundtable discussion that will happen at 4:00 p.m. tomorrow, an update on u.s. jolt, and on wednesday, a busy one. u.s. ism data for services. opec-plus will hold and enter monitoring session. a hristine lagarde scheduled to speak thursday. -- to speak. there's day, the boe decision-maker panel released, and round out the week, u.s. payrolls. coming up, the u.s. government staying open for now, recession risks are mounting. your big take next on bloomberg. ♪

larry: in many areas you may need a recession to bring down demand and i think this is one of the things that will impact the united states. you still have a very vibrant economy. the united states, the curve of the infrastructure act, the chips act, the chipset, the ira, which has huge implications. that will be creating jobs. it may require a more protracted federal reserve and it may mean by 2025 united states economy may be entering a recession but i don't see it in the near term. dani: that was the blackrock chair and ceo larry fink to me exclusively at the end of last week. doesn't see a recession until at least 2025, is he among many who are too optimistic? the u.s. government is staying open but lumber economics --

bloomberg economics sees more ahead. joining more is tamera henderson. most, including the fed, anticipate a soft landing in the u.s. you and the team expect a recession kicking off this quarter. why is that? tamera: the labor market is looking small and the fed is teasing another hike and if you extrapolate from that going forward it looks like a soft landing but bloomberg economics is looking for the recession to start this quarter and there are a number of reasons for that. first of all, the 525 basis points of rate hikes we have in the system, these will start to bite harshly this quarter. as we know, monetary policy operates with a lag that tends to be 18-24 months for the u.s. labor market to see it and we are in that window now.

supporting that we see key indicators are already flagging recession, these are indicators that are used to define recession. on top of this we have shocks. we have the auto workers strike, we have the student loan payments starting back up this month. and we have oil prices up sharply $25 from the summer. on top of that, a bit of a forecasting work our team has uncovered. altogether we are looking for a recession. definitely seeing a recession more likely than a soft landing. dani: i think this is part of the really important data that has been dug out by the economics team that consensus expectations for a soft landing have been proven wrong for every u.s. recession in the past four decades. a soft landing doesn't happen or

does happen and is followed by recession. why is that? tamera: well, come down to a quirk of forecasting that underestimates the risk of recession. it's hard to anticipate recessions because our go to models in forecasting, these assume a linear relationship. that means when we try to predict the future we rely heavily on the past, or are anchored heavily with the past. recessions are nonlinear. when we look at the data, we see unemployment, when it comes to a recession, it spikes quite quickly. so unexpectedly. the key takeaway, if we are using these linear models, which we tend to do, we need to be wary that the risks, the risks to recession are significantly understated. dani: yeah, i think again, this

story is probably the most important for everyone trading for the rest of the year to understand the economy. tamera henderson from the bloomberg economics team, thank you. coming up, snatching the crown. london could retake its place as a biggest equity market. we will discuss the change in fortunes next. this is bloomberg. ♪ i'm sam morrison. my brother max recommended you. so my best friend sophie says you've been a huge help. at ameriprise financial, more than 9 out of 10 of our clients are likely to recommend us. our neighbors, the garcias, love working with you. because the advice we give is personalized, hey, john reese, jr. how's your father doing? to help reach your goals with confidence. my sister has told me so much about you. that's why it's more than advice worth listening to. it's advice worth talking about. ameriprise financial.

dani: welcome back to "bloomberg daybreak: europe." u.k. stockmarket look set to regain its crown as europe's biggest equity market, taking it from paris, as a rally in luxury stocks begins to falter and gloom in chinese markets. london is seeing signs of investor bullishness for the first time in years. for more, let's bring in valerie. i know we made a really big deal of women the french equity

market took over london but i am kind of like, do we care? lvmh, is that not the only determination? valerie: you are right. the fall in the paris stock exchange has a lot to do with the weakness in luxury stocks hurtinglvmh. at the same time london's stockmarket eating a boost from higher oil prices. a lot of big oil majors listed in london. what you get here is the crown potentially passed from paris to london again. we have a two percentage point move needed in the london stock exchange to regain the crown. i think we will have to see the macroeconomic trends continue with ilprice higher and weakness in luxury stocks for that to have their -- to happen. dani: i am sure balloons will draw from the ceiling when it

happens. we started the quarter with a drop in equities, but can i get excited about a rebound in stocks? valerie: i share your pessimism. s&p futures and nasdaq futures getting a great bounce from the fact the u.s. shutdown was averted over the weekend, but the big caveat is we are still seeing this treasury selloff. it is continuing in the asia session overnight. the entire curve is higher by four basis points which is a big move for an overnight treasury session. we have these yields hitting up against all-time highs -- excuse me, cycle highs. that was a big dent to risk sentiment last week. if we continue to see yields heading higher i don't think the equity bounce will last longer. -- last much longer. what will that -- dani: what will that do for the boj? valerie: the wider the gap

between jgb's and treasuries, which means more pressure on the yen to weaken. i am more focused on fx intervention rather than the bond buying operations as we are getting close to the 150 handle in dollar-yen. dani: 149.65 is where we are at. thank you, valerie. i want to get into another reason perhaps for my pessimism, something bloomberg economics has been talking about, cracked in the consumer. this is from the pce data on friday, personal savings as a percentof disposable income. it has dropped. i should give a h tip to valerie for this, she made this chart. you can see the huge come down in personal savings since the peak and covid and it is very steep, much deeper than 2021. if the american consumer is the backbone of this economy, that

is bad news. bad news for any hope of a soft landing. bloomberg economics also estimates 80% of americansnow have less money than they did before covid. it is the poorest 80% that have less cash on hand. again, if you are looking for the backbone of the american economy to hold up, this is where to look and it does not look great. perhaps that's why we continue to see treasury yields higher. doesn't help we have all of the supply coming to market. we will have a lot of big conversations today. we will speak to all of them about these big topics, including the jp morgan ceo jamie dimon who recently has called for rates to go to 7%, that the fed could go there and we are not prepared for that. larry fink also told me five-year -- tenure rates will go to 5%. another interview, josé fernandez, the u.s. under secretary o state for economic growth and energy for and we

will also be speaking to you could chancellor jeremy hunt during the next show. meantime, it is a bounce in equity markets, nasdaq futures up half of a percent, but can it last? can we climb back from the very bad quaer we just recently had, the first quarter since 2022? good morning from a very foggy london. this is bloomberg. ♪

anna: this is "bloomberg markets today." mark cudmore with us in london to take us through the market action this hour. the cash trade is just an hour away. kicking the ca