255,000 people now dead. China hits back at u. S. Criticism saying the Trump Administration is lying. U. S. we are seeing futures flat at the moment after stocks gained for two consecutive sessions. We have seen sentiment being boosted as economies move towards easing the lockdown, cautionary comments from fed officials cutting the gains in half. Health care, utilities and games cut in half area energy was a gainer. Look at wti, adding to the gains of the regular session in new york. It had gained 20 , at the moment above 25 a barrel, the highest in over two weeks and the longest winning streak in nine months. Production is starting to ease. Walked up being felt across markets. Lockdowns being felt across markets. Wedi there is the sense dont know what is going on and price this market we are seeing . Lets get over to our next guest. Times,e unprecedented earnings for the companies that are still giving earnings, is pretty unreliable. What metrics do we go by in terms of pricing and valuation and risk and opportunity . Time. Is a very unusual as of 10 days ago the standard and poors earnings for the second half of the year were estimated at 72, annualized 144 each seems out of touch with reality. If you look at what disney reported, which was only beginning of the squeeze, companies had no idea how little they are apt to earn. Tradingets have been largely on pandemic rumors and reports. Up . He virus cases going are there vaccines or not . There is an interesting phenomenon. Nobody can treat trade a rumor. Trade mean the reversion. The algorithmic measures that amount for half of the volume in the marketplaces are largely being displaced because algorithms dont fit what is going on now. At this moment in time, if you look at the last two or three days, we have this interregnum phase where the pandemic trading searchas changed to a for equilibrium. That is perplexing to most investors. In terms of daily volatility, it is giving us a pause. By your estimates, the level the s p should be looking at after this is 2800. How do you reach that level and what companies do you see at the moment are fundamentally good and looking cheap . The most probable priced for the market today, tomorrow is todays price. Nobody knows really who will be higher or lower. It is fair to take the hypothesis the market today is perfectly priced. This is equilibrium and the way it will be because the digest people know at the moment which is not much. Think means there is a moment for the stock ticker to come back to the forefront because there are hundreds of companies that seemed enormously cheap in a market with the dow at 2800. Unpopular orone contrarian view which is the dominance of the things the faang stocks will have to come to an end. They have been the drivers of the good part of the market. I think that their sway is getting long in the tooth and it is a better time to be exiting those names, alphabet, etc. Rather than entering. Shery how do you factor in the reality we might live in a postpandemic world where the pandemic plays into the strength of the digital tech giants like we saw in earnings last week . Greaty are giants, companies, growing, strong. Era has happened in every is the Biggest Companies get pulled down. Bright people leave them, become bureaucratic and challenged by governmental apparatus. They are swayed. Their superiority gets reduced by their own success. Good people leave. They get to be too big and they become the regulatory or governmentally challenged. Not today are not tomorrow but this can start to happen to the faang stocks and those associated at some point here. Shery give us some of your picks and whether or not you have some sectors where a lot of those companies you like are in. Think stocks could be 50 to 100 higher. And animal care, veterinary pet care will be a growing sector. A company like immunotherapy because of peanut allergies. Enders to Small Companies those Small Companies are not going to go out of business. Capital, southwest, main street. Now enterprise products. It is an mlb, a giant of those, and it looks like oil is going to have found a bottom. Oil producers will go out of barrel, but 25 a there will be produce going through the Companies Like enterprise. High dividend and vitally necessary. Those are sectors and companies that can sell higher without the market going up. Haidi with dislocation in privately held companies, what do you see for private equity in that space . More opportunity or do you see the valuation coming down . I dont want to be debbie downer, but there are lots of private companies that have been bought and sold five to eight times, for revenues. They have been losing money, unicorns, highly valued. There is a total disconnect today between the prices that existed two months ago and the prices buyers would pay today. Equity the private companies, and some of them had publicly traded affiliates, that multiples of, revenues, quite probably going to be facing the high nature of lockup. It is like the Real Estate Market in a recession or the owners of houses remember the prices from two months ago for the buyers months ago. The buyers look forward to what is true today. That is so for the private violations of companies. It will hurt asset values in the immediate future. Shery Sandra Morris harris chairman and ceo. Lets get a check on first word headlines with karina mitchell. Karina u. S. China relations continue to sour over blame of the coronavirus with beijing turning fury on white house top diplomats. The Chinese State media unleashed a torrent of criticism at mike pompeo. It called him evil and a liar and rejected his claim of enormous evidence connecting the virus to a wuhan lab. The European Central bank is waiting weighing a court ruling. They have three months to respond. This will not stop the Program Immediately and will not stop a separate 750 billion euro plan to combat pandemic fallout. It raises questions over how far the ecb can push monetary stimulus. The u. K. Is the most earnestly affected country in europe, surpassing deaths of italy. It has more pressure on the johnson government with critics saying it has been slow to respond. The Prime Minister ordered a lockdown later than other countries and was slow to respond with testing. Malaysia cut its key rate by 50 basis points, the most since 2009. They said the outlook means gloomy. Remains gloomy. Indonesia had the weakest showing since 2001 and a heavier toll is expected in coming months. Indias virus lockdown saw a loss of 120 million jobs last month. 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. I am karina mitchell. This is bloomberg. Trumpsore details on plans for phase two of the coronavirus response. And we will speak to the council of the americas Vice President eric foreigns worth about the global balance of power. This is bloomberg. Shery President Trump continues to push the theory that the coronavirus originated and escaped from a lab in wuhan. Intelligence Officials Say the evidence is less than definitive review pushes for the reopening of the economy. Itthe people will not accept and they should not. We would have a great country. We cant keep it close. Doctors say not why not close it for a couple of years . Some people will be affected, badly, yes, but we have to get our country opened and get it open soon. Wilkins joining us from washington, dc. These intelligence agencies dont seem to be an agreement from where the virus came from. Do they have anything else with evidence pointing to this lab . Emily you have to remember that when it does come to the intelligence agencies, they dont speak with one voice per they hammer one voice. Voices. E a number of they are not sure it came from a laboratory. There has been some possibility of began in one of the chinese wet markets where animals are sold for food. It is verynt i think premature to say this began in a lab or with purposeful intention. In the meantime we are seeing the ratcheting up of the rhetoric, and mike pompeo has become the new target for the chinese side. These statements originated with mike pompeo, secretary of state. You have seen china use, come back against what the u. S. Has said. Trump revises upward estimates of the deaths. China is saying we are doing a better job on this area there has been a competition when it comes to the coronavirus, how well they are handling it and helping other countries. This is something we are now in, since may, we have been dealing with this since january, it has ome politically politicized with the u. S. And china. Andy what are we expecting the reopening in reopening of states . A number ofve seen states reopen. California, georgia, texas. A lot of openings are limited. There are still restrictions on Wearing Masks and keeping social distancing inside restaurants and movie theaters. This is something President Trump wants to encourage. He wants to see the economy back and strong because that is what he was going to run on november 2020. He is eager to see that come back and the number of those who are unemployed rebound of that rebound a bit. We will have to see what happens for the states that are taking these steps and removing restrictions. We are watching closely to see whether we will start seeing the number of cases and deaths jump in those states. Haidi this is playing into his Reelection Campaign and the rhetoric and the war of words and tariffs with china. Is there any indication how well that is playing with lebron public well that is playing with the broader public . Emily a number of revolt against of republicans have joined President Trump calling for getting people back to work. Michigan and ohio, you see big protests with individual citizen saying we are tired of staying at home and not being able to work. We want things to be open. Youre seeing the energy and backlash to shut down policies. It will be a matter of all right. If we open, what is the result . That is the concern of everyones health and now the question is now that we have been through this, is it safe to begin lifting restrictions . What will the result be . Haidi our congressional reporter there with the latest. We will get the latest on disney, falling in extended trading. Disneyland in shanghai is set to reopen. This is bloomberg. Disney is set to reopen toshanghai, giving hopes people hit by the pandemic. Disney results showing the bright spot with streaming. Lets get more. The shutdown in parks was mainly responsible for the massive profit plunge. It we get guidance as to when other parks could reopen . Shanghai will be off of the mandatory shutdown. Geetha yes. The situation is fluid. Obviously keeping the parks closed did result in that drop in profits. The shanghai we opening will be done in a carefully safe and. There would be advanced reservations. Cleanings and so on will continue. They dont know under what conditions they can open the rest of their parks, but shanghai will provide them with some sort of a blueprint for the reopening of other properties. Arey given how much they struggling, they are disclosing they received 150 million in credits through the u. S. Fiscal relief package during the quarter. We saw some bright spots with disney plus streaming. Could that offset the other challenges youre seeing . Plus has been a huge saving grace for the company even as the other segments have gotten hammered. The quarantine and shelter in place has provided a nice bump for the streaming subscriptions. A huge growth in terms of the disney plus subscription platform. Millionalmost 55 subscribers in six months. The company has been opportunistic in terms of after terms of international islout but the segment losing money. It will be a while before it can offset the pressure on the tv networks. Haidi what are the biggest concerns for the investors longterm . Geetha the situation is fluid and there is limited visibility about when the parks will reopen. The issue is when they can operate at full capacity. Bob chapek said the current restrictions in china limit attendance to 30 . It will take a long time for the parks to kind of come back to their prior levels area sports, broadcasting, that will resume again, a huge question. A real key factor for investors is going to be the longterm implications for the movie business. Disney makes up a lot of domestic box office, 40 . With the huge shift in streaming, there are a lot of lauras and risks to the longterm viability of the theatrical model. Shery thank you. You can get more on daybreak. On youryb terminals and available in the anywhere app. Get a check of business flash headlines. Airbnb is cutting a quarter of its workforce as the coronavirus ravages global travel. 1900 staff are expected. The ceo says they are living through the most harrowing crisis in living memory. Airbnb was poised to be the biggest stock listing of the year. It has raised 2 billion in a bid to whether the fallout. Cooper being sued for violating a new law to give gig economy workers the benefits of employees in the ride hailers have tried to save on labor costs by classifying them as independent contractors. Case, theye the could be forced to pay overtime, health care and other benefits. Support to avoid bankruptcy, giving it time case, they could to find a rescue time after it missed debt payments. Untiliver gives hearst may 1 to better impact the they have been talking to creditors about easing the debt burden without bankruptcy although it is ready to file for chapter 11 if necessary. At what be last orders was once the top restaurant. 11 madison park was voted number one in 2017 but may not reopen after the lockdown in new york. He said it will cost money he does not have to restart and the business may not be viable. 11 madison park has let all of its workers go without pay, a decision which broke his heart. As the world struggles to contain the coronavirus, the u. S. Blames china, and beijing makes a powerplay in washingtons backyard. Eric farnsworth explains next. This is bloomberg. Karina you are watching daybreak australia. U. S. China relations continue to sour over blame for the coronavirus with beijing turning its very on the white house top diplomats. On the white house top diplomats. They called mike pompeo evil and a lawyer a liar. They say there is no evidence to connect the virus to a will run lab. The virus takes an even deeper told on the economy. Retail sales plummeted further in march as visitors from china stayed away. Sales slumped 42 . By volume they saw almost 44 . On the report from the International Energy agency said Irans Nuclear program received record inspections last year with monitors given wide access to reactors. It inspectors were able to the see Irans Nuclear commitments under the deal the u. S. Has abandoned. The Trump Administration supports stronger sanctions on iran. The venezuelan president has n evidence he has two people have been arrested after they left the border. They say the u. S. Is behind the action although the Trump Administration denies involvement. 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. I am karina mitchell. This is bloomberg. Lets look at the markets. Kiwi stocks are unchanged. 15 minutes we are getting First Quarter ismployment rate during this from the labor market looking prior to the impact of the lockdown. Watch out for that. We will get you those numbers soon. Is from thesydney futures under pre after the rba left rates unchanged. We are watching out for retail numbers. That will be interesting and we have seen the toilet paper driven surge in april in march. U. S. Futures gaining around. 2 and crude extending gains. The Trump Administration is stepping up his attacks on china, blaming beijing for the coronavirus pandemic while china is pushing back and seizing the moment of global uncertainty in making a powerplay in washingtons backyard. Eric farnsworth recently put out a warning on virus play in the americas and he joins us now. This has been happening for some time, but how does the pandemic make it an ideal situation for beijing to expand its influence . It is great to be back. This is something that has been going on for a good, long time, 15 years in terms of china laying the groundwork to capitalize on the impression equalt is now at least an event yet even not an more reliable partner for the caribbean. This is a crisis, a regional situation where countries across the region need help and they are willing to take help from wherever they can get it. China was quick off of the mark offering ventilators and equipment and reagents, all the things latin america clearly needs. They did so with great fanfare, media and narrative, trying to show they are very reliable your this goes at the heart of the case washington has been trying to make that indeed the United States is the more reliable partner for latin america. This is not a scenario of medical diplomacy. It goes deeper than that. It is a play for the hearts and minds of the people. Shery how are emerging markets for beijing . They are critically important for the narrative beijing is trying to promote worldwide. There is a huge economic component in terms of trade. We have talked about that before. It is broader. If beijing can develop relationships with emerging markets but essentially become dependent on china economically, there is leverage to try to change behavior among leaders and others in emerging markets to stay away from controversial topics like taiwan, tibet, south china sea. That is point number one. Create alooking to narrative to equate its own system with western democracies in terms of being of equal value. This is important. If they can show through the coronavirus scenario that the chinese system can produce that are results, or equipment, and western democracy continues to struggle in that way, then you whereot a real situation people will say wait a minute. How is this one system better than the other when they cant help me with my own health and wellbeing . That is part of what is going on now, so you come out of this with a question in many markets around the world of what is the superior system. That is what is at stake here. Haidi a big part of that in fish influence was supposed to take part through the belt and road. Does that get a hit from the coronavirus . Diplomacyf dollars of are at risk. There is somewhat of a backlash. Perhaps that was chinas ambition. I did not say that would be the reality. Along with the connection to china, you have countries who have gotten into problems with debt. This was even before the coronavirus. Along with thethe coronavirus ho play about debt trap diplomacy. And the things that may not be environmentally sound or subject to the same conditions western Companies Might be involved in. What people are coming to realize, once you develop the economic relationship with china, whether you want to or not, you are developing a political and strategic relationship that binds you into a certain type of behavior perhaps. It is that issue people recognize, this is not cost free. It is not Just Economics and trade. There is a political dimension people have to be aware of. Surprising this debate as to whether democracy like this is less efficient in dealing with crises, because it is quite clear in a system like chinas, you can have a complete lockdown. Many other countries, not many would be able to replicate that. Are their partners of china that look vulnerable . That is right. The chinese system is adept. It is centrally planned and determined. Across latin america and cuba, there are not countries that could react in the same way. What makes this attractive is to leaders in countries, thinking of like venezuela and nicaragua where the leaders are not behaving in a did democratic manner. To the extent they are able to replicate these behaviors using Chinese Technology which has been exported into the region, the techniques the chinese use for social control and for smart cities technology, this is neutral technology, but to the extent somebody wants to use it for social control and management, it can be done. You have a country that has strong institutions that protect civil liberties, independent courts, that is ok. We cant assume every country in latin america has those advantages. Countries with a weaker rule of etc. ,d human rights and democratic institutions, those are going to be more vulnerable to the exploitation down the road. Venezuela is the best example. Shery President Trump has started claiming beijing is trying to damage his election campaign. What would be best for china, dealing with President Trump or perhaps a democratic president . That is hard to know. Given the elections are so far and so clinical terms much can happen, but one thing we cannot we can agree on is china will be a part of the u. S. President ial campaign. Both parties, whether or not beijing has a preference, that is something only the folks in beijing can say. Haidi such a pleasure having you on. Eric farnsworth. European trade commissioner phil hogan says it is important for countries to ease restrictions. He is looking forward to renewed talks with the u. S. , speaking exclusively to bloomberg tv. In the beginning there was Crisis Management and the temptation is always there to put up barriers and restrictions and deal with the immediate pay we have to move move we have to remove those. At the same time every country will be looking at vulnerability in the context of the pandemic and how they are vulnerable at this time in terms of medicine, pharmaceuticals are they will want to do more local production. This is what is happening all over the world. We need some rethinking and what we should do in terms of working together. I have been reaching out to the United States and wto to see if we can Work Together and have a speedy recovery. To, i have been talking would have thought ambassador lighthizer. What are your jobs one of your jobs before the arrival of the coronavirus was to put the 2018 talks back on track what is the tone of the authorization with washington . Is it amiable to making that happen, putting them back on a more even Playing Field . Over the last few weeks, people have been concentrating on saving peoples lives in the unitedn union and states. We are expecting in the next few weeks to get back on track for the mandate in the European Union is to negotiate with the American Administration based on the 2018 mandate very we have been making progress in the early part of 2020. I am looking for to engaging with ambassador lighthizer to make more progress. You visited d. C. Several times during that time. One of the sticking points was agriculture. The u. S. Wanted agriculture on the limit is it now on the table potentially . We continue with the mandate of 2018. We are both happy to do so. We have made some gains on various issues. Industrial products of the future, with the commerce secretary. There is a big agenda with agriculture on the table. There is an openminded spirit to make some agreement here. I hope theing good engagement in United States. I am happy with the constructive engagement we had in the early months of this year. I have invested a lot trying to refresh the ambassador the relationship with the United States. We are having a conversation at the moment. About countries looking inwards. How can you have a less globalized Global Economy and at the same time cooperate with the United States and various European Countries . Europe is looking at strategic autonomy. Fair competition, fair rules that can be implemented by a reformed world trade organization. We are doing a lot of deals around the world, we have a lot of partners and 75 countries and we want to do more. There are vulnerable sectors we have seen exposed particularly in the health area. The production of medical supplies is important and essential for our citizens. The European Union and the u. S. See the decision that you cannot depend on one geographic location and we have two diversify. We are going to do that. So is the United States. That doesnt mean they cant do both. We can deal with the vulnerable sectors that were dependent in the crisis, but we have to have an open rulesbased approach for the entire economy. That was the e. U. Trade commissioner speaking with guy johnson and vonnie quinn. We have some information about the labor market indicators out of new zealand. The Unemployment Rate falling to 4. 2 for the First Quarter, better than expectations of 4. 4 . We are seeing the quarter on quarter change for unemployment 0. 7 , a bigger change than expected for the contraction that was expected. When it comes to the change year on year, we see a positive number of 1. 6 . Rising, 7. 4 . Rate average Hourly Earnings also grew 1. 4 . We will get more analysis on that. This is bloomberg. G. The bank of australia kept its cash rate and bond purchase target on hold as expected. But they are ready to scale purchases up if required. Joining us now is alexander. The rba made some policy tweaks ahead of the forecast on friday. What is the forecast . Changesba made no major yesterday. It lift the target for the three year yield unchanged. Emphasis,tioned, the it emphasized while it has been able to scale back the frequency of these purchases, it is purchaseso scale up should it be required. Wooden the government ramped up this package, when the government ramped up this package, we could see them step in and do more. The rba made unexpected changes to its daily open market operation facility, which it has used for a long time to set the target for the cash rate. It expanded the eligible collateral to expand accept this. This should provide support for the Corporate Bond market. Financial credit this move means the rba can support the Corporate Bond market as other Central Banks have chosen to do so, but it doesnt have to buy private sector assets which it has been keen to avoid. Shery we are getting australias retail Sales Numbers for march. We saw all of the toilet paper hoarding in that month. Will this have any implications on gdp . Im excited about the data this month. We have seen the margin values with the advance estimate. They suggest data will show the biggest increase in history. This is a result of the toilet paper hoarding, the athome jim and the athome gym and equipment set up. I am also interested in overseas data. Consensus stays around 1. 8 increase for these quarterly volumes, the highest in a decade. While these data are not perfect for what goes into gdp, it would suggest a strong rise in this component that is 50 of gdp. It would be interesting to see how this stock does against in overta and trickle the next month especially given the outcome is assumed negative. Shery thank you. Our economics editor. Consumers, nothing on beyond meats product with sales expert outpacing expectations. This is bloomberg. Shery United Airlines is planning to slash 30 of whitecollar jobs in government imposed restrictions lift in october. Office workers will be told to take 20 days of leave without pay. Billion payroll support package runs out at the end of september. Virgin atlantic is to cut around a third of its staff as travel demand plummets. It will close its hub at London Gatwick after failing to secure bailouts from the u. K. Government. Richard branson will now concentrate operations at london heathrow. British airways is also looking to quit gatwick. 12,000 jobignaled losses. After the bell earnings, the lockdown has been a boon for videogame makers. Electronic arts and activision are rallying. Beyond meat. Or more companies are withdrawing guidance. Su we saw beyond meat and occidental reporting, withdrawing guidance. You can see there was enough other news to push stocks higher. Lets go into the bloomberg and focus on beyond meat. That is the alternative land raised company that is like meet but not. Lockup expires, we see people shorting a stock of abetting it would go lower, remove those. Take a look at how the stock has done and listen to the results. In a typical new company, recent ipo, investors focus on growth in the bottom line earnings per they exceeded wall street expectations and were up 141 and slightly better yearoveryear. That is growth for them. Electronic arts and activision, game makers, they crushed estimates because the lockup has been great because more gamers are at home and downloading and playing games. Occidental has had huge exposure to the oil crash because it bought up debt. What is the story . Debt to quadrupled on make that purchase. They had to take the 1. 4 billion right down. This also included impairment charges and they were exposed of course, they were exposed to the huge drop in oil or look at how their own stock price fell off a cliff. And withdrew their guidance have taken severe cuts to. They are cuts to capex. The outlook remains cloudy. Haidi su keenan in new york. Coming up in the next hour, we speak to the jpmorgan asset manager global strategist about his expectations. Plenty more ahead on daybreak asia. This is bloomberg. Haidi a very good morning. I am haidi stroudwatts in sydney alongside shery ahn in new york. We are counting you down to the market opens in australia and south korea. Welcome to daybreak asia. Top stories this hour, asianpacific stocks look set for another tempered byimism caution from the federal reserve. Oil maintains its recovery from last months epic plunge as more economies emerge