The eu needs to combine aid with reform in a message to the frugal four. Welcome to daybreak europe. What a turnaround we are seeing in chinese equities. We are still looking to eke out a weekly gain. You are seeing some weakness come through on the csi 300 on on the warning signs. Futures, we are set up a little bit negatively there as well. Featuresk 60 fit 50 the 10 year treasury yield slipping as well and oil pulling back as well. It is heading for a weekly loss. The u. S. Has reached another troubling milestone in the coronavirus pandemic as daily cases topped 60,000 for the first time as the World Health Organization says it is keeping an open mind as to whether airborne transmission plays a major role. Good news in labor market data. Jobless claims fell by the most in a month so there is they are still the they are still double the highest level. Joining us now is geoffrey yu. Thank you for joining us. What do you make about the jobless claims data and the labor market in the last because we see a little bit of an improvement but we also have a number of announcements about job cuts in corporate america. Geoffrey this is not really unique to the u. S. Right now. We are seeing it in the u k and will probably see it elsewhere. The economy is reopening but not at full capacity which is posing a bit of a conundrum for policymakers. Want to doks do not more until they see what the fiscal is going to look like but in the u. S. In particular, this underscores the need of the greatest fiscal support. I think that will be the focus week. Coming we have seen fiscal announcements in the u. K. Will that be enough . To realizekets need you cannot save every job. Nejra how high is the disappointment risk for equity markets globally . Geoffrey right now, it is going to be relatively high when it comes to a point that we do get the hard data coming through, especially on the labor market and on the spending. That does not match up with how equities are being priced right now. Will telly guidance the same story. That is when we could have a bit of an adjustment. Global concerns about a second wave also coming through. Them to a road of recovery. Nejra you mentioned the consumer. We had a separate report showing Consumer Confidence in the u. S. Cooling for the first time in seven weeks. It is one data point and we may not want to read too much into it but is the u. S. Consumer going to be as robust through this crisis as we have always believed they have in the past and proven to be . Geoffrey this is a relatively unique crisis. This is not what the financial it is probably too early to tell. Has increased. S people have not spent as much. There is a little bit more of a cushion that could be unleashed in the medium to longer term which is a more positive note. But on the negative note, the question is do they feel safe going out to spend . Will the citys be able to us will the cities be able to sustain this . Will offset one another. Especially with the second wave concerns. Nejra would you be cautious about Dollar Strength into the back half of the year . Or will the dollar be the safe haven of choice if we do get a second wave and risk assets cool off a little . Geoffrey i would be cautious about Dollar Strength. For the first time in a while, it is independent about the trajectory of risk appetite. Over the last few years, the allocation process has been overweight u. S. Equities especially in tech and u. S. Dollars. It is time for other risk assets to be filled. I think europe is in a good place right now if we can get the fiscal packages through. If it is going to be negative ,isk appetite, risk aversion will the dollar be a safe haven . Global risk is not picking up because the u. S. Is not managing covid well and other concerns, then the dollar may not benefit as much. Nejra interesting. Geoffrey yu will stay with us. Sticking with the u. S. , President Donald Trump must provide his tax return. The Supreme Court has ruled the president has to comply with the request. Justices also rejected congressional requests for the information which means it will likely stay out of the public eye until after the november election. Joining us now is bloombergs annmarie hordern. Talk to us about the significance over this latest development. It was the split reading. When many people were wondering whether they would be able to see the financial records come it will likely not happen anytime before the election. The first part of the ruling was the Supreme Court backing the new york grand jurys bid for Donald Trumps records. S quote stood out to me 200 years ago come a great jurist of our core and established that no citizen, not even the president , was above the common duty of providing evidence when called upon. This ruling was a victory for the manhattan da. They may be able to get their hands on President Trumps tax returns but that does not mean that the public will see them. The Supreme Court blocked for now the house subpoenas that might have led to the public release. Is a win prism, this for President Trump. Shielding the president. President trump was on twitter blasting the Supreme Court in numerous tweets was he was calling himself a victim of political persecution. The president is not above the law is at the bottom line. Nor is he a above immunity. Meanwhile, we learned about joe bidens economic plan including commitment to build back better. Do we have a sense of how that went in the polls . Right now, this is the one area where biden is slipping in the polls narrowly to President Donald Trump. He did it as well in pennsylvania near his hometown, a swing state that is crucial to democrats versus republicans. Donald trump narrowly won pennsylvania in 2016. Different stand to President Trump in terms of the economy. President trump has been saying that the economy is bouncing back. Joe biden framed his plan as Building Back better than what existed before the crisis. About this yesterday. He is adopting some of these progressive ideas honing in on manufacturing and buying american. But he avoided the proposals like the green new deal. Notehing that we should which would be important to our thatrs at bloomberg is u. S. Companies only bear responsibility to their shareholders and that is a farce. He wants to bring the Corporate Tax back to where it was during the Obama Administration up to 28 versus the 21 currently. To the first get word news. The eus most powerful nations were handed a shocking defeat. Has called donahoe won the ballot. A favorite, the spanish economy minister. The u. S. Is planning action against france in the longrunning feud. A tariff will be released. Targeted could include french wine, cheese, and handbags. The u. S. May decide to delay bringing in the duties. Singapore heads to the polls today as a ruling party seeks to extend its 55 year rule. Special precautions being taken include temperature taking. He issues in the campaign include jobs and the economy which is contracted as much as 7 amid the global pandemic. 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. Stocksup, chinese succumbed to gravity. Plans to trim holdings. We take a look at the Market Action next. This is bloomberg. Nejra this is bloomberg daybreak europe. At us get a look at the risk radar. Ending the week and risk off. The asiapacific index weaker in general. And u. S. Futures on the back foot. Fxlar strength is a story in , it weakens against the yen for the the third day. And oil heading for a weekly loss. Megashareshinese trim holdings. A sign that the government wants to slow down the record rally. Here to explain is bloombergs dani burger. The countrys National Pension plan outlined its plan to sell a 2 stake. It said it was part of the regular investing activities but looking at the rally, the signal might be this that stocks have gone too far for regulators liking. If you look at the rally, market every has outpaced other Market Worldwide and now is in the positive in terms of adding market cap to date. There are signs of euphoria popping up everywhere echoing the turbulence in 2015 in chinese equities. Margin debt has risen at the fastest pace since then. There we are volumes and here we have it in the trillions of you on. Uan,f yoan this begs the question, are we seeing an end to the run . Or is today just simply a breather . Nejra dani burger, thank you. Geoffrey yu is still with us. Whatday just a breather in has been a stunning rally in chinese equities . Geoffrey if you look at the general narrative in china right now especially from most official sources, the fundamentals in china include reflation are sound and this will underpin stock market performance. And on a broader policy front, the pboc and the governor said in april that he would like to see more Equity Financing and that is profitable preferable to debt. Whatis more in sync with the economy is trying to achieve. They do not want it to be at a relatively cool pace. That has always been an issue in past stock market rallies. The signs are pretty clear. Nejra how useful are comparisons to 2015 . Earlier this week if we talk about leverage, the level of leverage was only at about 50 compared to 2015. And equities started at a lower base this time. Is it useful to make comparisons with 2015 if we are trying to prognosticate where the markets will go from here . Just look atyou market operations, it does not seem they are providing that much liquidity. Even if you track the margin data, there are other forms of product. I think one other main difference is in 2014, the hong. Ong shanghai came online there was a sense that foreign there is gradual a share coming through. Is the chinese economy outperforming and that justifies greater Asset Allocation by investors into china as well. Growthely come earnings cannot justify this. Let us wait and see what corporates can deliver. Corporates can deliver. Nejra is this a relationship that will continue . Geoffrey for the time being, it will be allowed to continue the 10 year you get yield hovering below 3 , that sometimes is a worrying growth at the signal. Death worrying growth worrying growth signal. There are other ways to limit the tightening of financial conditions. For the time being, i think it will not be a problem. And i think it is relatively healthy. Nejra you were sitting at the beginning of the conversation support fundamentals do the rally in chinese equities but if we look at what happened since the pandemic, there is the specter of deflation. Also, coupled with the fact that there has been concerned about demand coming back in china. Looking at the pmis, the is that supported by the fundamentals . Geoffrey we start from a low starting point. You could argue that the undervaluation there is a lack of confidence to step in. On the Chinese Consumer probably should be outperforming especially in the medium to longer term. It is on the industrial side where there is no big bank where stimulus, that is the disinflation pressure should be strong. Once we have gotten past the initial euphoria, sector selection will be very important. Focus on the rebalancing. That is where we are going to start to see greater differentiation in how sectors perform and we will know which sectors are doing well. China wants growth to be determined by the consumers. Nejra geoffrey yu from byu mellon. The u. K. Government is trying to lift the economy. A look at which businesses will be allowed to reopen this month as the u. K. Slowly returns to normal. This is bloomberg. Nejra this is bloomberg daybreak europe. Restrictions are being further eased in england this month. From tomorrow, outdoor pools will be a allowed to reopen. On monday, salons and spas will be able to reopen. The government is slowly trying to get the economy back up and running again after a difficult quarter while containing the virus at the same time. Geoffrey yu is still with us. Concerned about a second wave in the u. K. . Geoffrey it is probably too early to tell at this point. And within europe relative to what happened in asia and the u. S. Europe has managed it well. Tokyo, weg kong, and have heard from the health authorities. Get lockdowns even if there is a second wave . That will be a difficult political decision and even in asia. The countrywide lockdowns, i think that is very hard to see that happening. What has been interesting though is that even though we have had the announcement this week and terms of support for the labor market and cuts to certain sectors, if you look at u. K. Yields, they stay suppressed. Is the bond market and convinced that the stimulus will do as promised . Geoffrey they anticipate that the bl we will have to continue to extend support as well. In terms of the current stimulus, there will be a sense that it is more of a medium to longer term plan. We are talking about about we are talking about 30 billion pounds. A lot of that will depend on whether the u. K. Economy can recover in time. This is probably a down payment. Will see if anything else come in place. In terms of growth, that is when yields that is what yields will be linked to. What is the next plan . Focused much more on protecting jobs . Think the argument has been made that enough has been done in terms of protecting jobs through the pandemic. We have to look at spending , living patterns, and working patterns have changed. A lot of the jobs will not return and it is not reasonable to expect the government to tide over the entire labor force. Patterns in society have changed. There is a realization of that. Maybe there should have been some wiggle room. Profile, it is twice is twice as long as the g7 average. 60 budget deficits for this year. I think he wanted to send a magic that there is some money but it will not be growing for too long. Is where he is trying to strike a balance. Nejra geoffrey yu, senior strategist at byu mellon. Coming up, infections brought from other states helped to drive new jerseys transmission rate to the highest in 10 weeks. We hear from Governor Phil Murphy about tackling the crisis. U. S. And european futures in the red and the 10 year yield slipping. This is bloomberg. Nejra good morning from london, im nejra cehic. Here are todays top stories. U. S. Jobless claims fall but more pain could be your head as virus deaths in the sun belt hit a record. Global equities slipped and chinas stock rally calls. A sign that the government wants to slow the surge. And an uprising over the euro grow presidency. There needsl says to be a message to the frugal four. Welcome to daybreak europe. Taking a faulted a. Set to beed funds selling. A rally took the gauge within two Percentage Points of its intraday peak. U. S. Futures on the back foot as well. We are seeing some broadbased risk off because eurozone futures are gaining some momentum to the downside. U. S. Equities closed in the red yesterday. Dollar strength against g10 and oil on the back foot and heading for a weekly loss. Global equities are heading for a weekly gain despite the risk off today. Another has reached troubling milestone in the coronavirus pandemic as daily cases top 60,000 for the world time. World Health Organization says it is keeping an open mind as to whether airborne transmission contributes to its spread. But good news in the labor market. Jobless claims fell by more than a month. Now, more on the coronavirus pandemic as new jersey Governor Phil Murphy says his state will need to bring in more revenue for next years budget in order to fully recovered. Murphy spoke exclusively to david westin on the impact. Gov. Murphy you are right and the toll has been enormous, over 13,000 confirmed deaths and probably a couple more thousand that are suspected to also have passed from covid19. That is the awful tragedy. Lotnumbers have gotten a better. As they have gotten better, we made the decision based on the facts and the science to begin stepbystep reopening our stay. Thatew when we were doing that we would take on more risks in terms of increasing the potential for transmission. We were comfortable with that risk it. What we were not expecting was the explosion in cases elsewhere in the country. And so, the rate of transmission has gotten a little bit uncomfortably high for us. It improved slightly. We put in with new york and connecticut a travel advisory for folks to self quarantine if they are coming back into our state from a hot. As your colleague noted and i welcome her to new jersey as a resident, we are now requiring face coverings outdoors. Those are steps we have taken in the last 10 days. We have held off on Indoor Dining which brings me no joy but it is clear that this virus is more lethal inside than outside. We are watching this minute to minute and trying to make the decisions at every steps at every stage based on the facts. The fall coming and school is on the National Agenda as the president is pushing to reopen the schools. To what extent are you planning on people being able to be in the classroom as opposed to Remote Learning . Of. Murphy our departments education and health put out standards a couple of weeks ago that are very comprehensive largely defining the parameters in the basic principles and leaving it up to our districts to develop their plan and come back for our common agreement. Our bias is to get kids back into the classroom. That is the starting point but we have to do it responsibly. The toughest nut to crack is going to be preventing the unwitting passing of the virus from an asymptomatic young, healthy kid two and older educator or administrator or someone with Underlying Health challenges. The whole notion of capacity constraints, social distancing, face coverings come up lots of hyper hygiene etc. And doing things outdoors whenever possible, they will all be elements of what we think it will look like. A sense of that desperation because i understood that your budget is balanced through september 30. Balanced to it is it is a constitutional requirement. Budget balanced for three plus months, we had to cut or do for 5. 2 billion in expenses. The not for new jersey we have estimated that mid this 20 billion. Is that is the amount that is how overwhelming this crisis has terms of expenses that have exploded and revenues that a fallen off the table. David will you have to borrow money . What does your access look like . New jersey has not always had the best credit. Gov. Murphy we are developing our next budget. The first place we will go is the Federal Reserve special program set up and that will be the first port of call. We will go from there. Both. L be and im sure borrowing will be in the billions but we are not alone. This is an american challenge. Sadly, we are seeing the virus explode around the country. The other states are in our prayers. A reminder that we are all in the same boat together. Jerseysat was new Governor Phil Murphy speaking exclusively to bloomberg. First word news. As the eus most powerful nations were handed a sharp diffie over the presidency, donahoe one back the ballot. Won back the ballot. Spanish economy minister was the preferred candidate. In poland, the president says he will never allow compensation for jewish property lost in world war ii. The controversial topic is resurfacing days before the president runoff election. He faces top competition from the warsaw mayor. Banks risk between beijing and washington. The scope of the new legislation has taken many businesses by surprise raps especially article 29. Rolenies that breach the risk of fines or losing their license to do business. 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. We speak to dr. Nneka abulokwe coming up on the lack of diversity and black talent in boardrooms. That is next. This is bloomberg. Nejra this is bloomberg daybreak europe. Let us get a look at the risk radar. Ending the week with a risk off. Chinese equities decline for the first time this week. U. S. And european futures point lower. And it is risk off a cross assets. Stronger dollar but weaker against the yen for a third day. Let us turn to diversity and the picture at the u. S. Federal reserve is still pretty white and male. Jerome powell says there is no room for racism and inclusion is a high priority. The institution still has a lot of work to do in that regard. Joining us to discuss is bloombergs annmarie hordern. It is very white and it is startsle and as the u. S. To reckon with its history on race, the fed is taking an internal look at its own makeup. If you go through some of the numbers, the board of governors are all white including two women. There are two vacancies to which President Trump has nominated a white man and a white woman. Men we have the 12 Federal Reserve banks around the u. S. Including one black man, one twoanamerican man and women. Employment at these fed branches follow a similar way where as a supporters of these are us talk about black unemployment as well because Jerome Powell has said that he does want to do something about the racial in a witty evidenced in the unemployment stats but have we seen any improvements . Can the fed even do anything about that . This is something that atlanta fed president Raphael Bostic came out and wanted to target in terms of policy. Data yesterday showed that black Unemployment Rates fell for the First Time Since the start of the pandemic. The pandemic has disproportionately affected minorities. But it was the fact that this rate decreased for white workers by more. When you look at the disparity, it is widening further. We have seen this since 2015. The black Unemployment Rate is the highest among the largest in terms of the categories. When you divide up the data like this, it paints a better picture. Income minorities being hurt disproportionately in the correct recession. Fed leaders are beginning to more bluntly talk, look, and go after racial disparities. Bostick gave an interview to bloomberg recently to look at everyone this saying that he himself had been racially profiled in the past. Staying with diversity, one of the sectors with the worst track record, tech despite pledges over the years and in light of recent lack lies matter protest come of the tech sector is still predominantly white and male. Our guest says the diversity needs to go beyond an arbitrary box ticking exercise. A wide range of factors such as intellect, age, and professional experience as well as gender and race need to be considered. More thanabulokwe has 25 years of experience and was one of the first black women to sit on a board. Welcome to the show and thank you for joining and congratulations on all of your achievements. How bad is a picture in the u. K. When it comes to representation in boardrooms. Ka good morning. Sad to say, it is not very different than in the u. S. Teetering e were distill thatyou down to black representation on boards, it is even less. And this is looking at the population up 13 of the u. K. Population and the black population of 3 of the u. K. Population. These are startling figures and something more needs to be done. That do you get a sense the black lives matter protests this time has really resonated with the Business Community in the u. K. . Do you get a sense that things might actually start to change now . i hope so because this has transcended race. We have seen the protests out there and we have seen white people and black people. This is no longer about all lives matter. On the shining the light social inequalities in the racial injustices that black people have had to suffer. Have come companies out with a big and bold statements talking about denouncing racism. These have gone further to implement policy changes but we need to do more and this cannot be the perfunctory attitudes that we have seen in the past. If we are to grow as a nation, we need to tap into that 3 and a 13 and overlay that on any companys balance sheet. 3 , topline. We are hemorrhaging talent and we need to do something about that. We need to begin to have conversations that are profoundly uncomfortable. We need to get past feeling uncomfortable. It is uncomfortable for me as well. We need to begin to have those conversations and then get to of the issue and solve the problems with affirmative, sustainable action. Nejra since you mentioned affirmative action, i want to ask because one conversation that is starting in the u. K. We are already measuring the pay gap. Should we be measuring the race cap . You cannot measure what you cannot see. At the highest echelon and top levels of tech companies, i come from a tech background. Black representation is almost nonexistent. I happen to be one of the first black women to sit at this level. Things have not changed. We need to be able to have those discussions and understand what the problems are within companies and then begin to put in career progression including recruitment at all rungs of the latter of the ladder. As well as retain, measure, and hold boards accountable by reporting on progress. Are looking at the gender pay gap, we can do the same thing in the black community. We need to address the racial inequality in a constructive manner. Let us come together for the greater good of society. This surely cannot be bad. Nejra yes. No, and you were talking about a couple of things one of which that you need to measure and you need to account for the steps that are taken. What needs to be done concretely at the recruitment level to ensure that it is a diverse recruiting process . Nneka i will borrow your phrase, concretely. I will give you an example of how you may unknowingly or even sometimes consciously exclude a whole part of the population. Said we haveine been scratching our heads. It came to the last box and it was Something Arbitrary about having policy experience or ftse 100 experience. We know there are no black executive directors in the ftse 100. Hat immediately discounted me and if that happens at all levels of recruitment whereby you are inadvertently taking in exclusion criteria, you are hemorrhaging talent. There is an argument for saying that when you are not so selective, you dilute or lower the quality but i argue differently. You are opening to a richer and more Diverse Talent population. That surely must be right. Fantastic to get your thoughts this morning. Thank you for joining us, dr. Nneka abulokwe. We hope to see you again soon. Coming up, a surprise win for oe wins. As donoh we get reaction from brussels, next. Who was backed by the European Unions four major economies. Maria, great to have you with us. A surprise winner for the euro group. What are the implications for the eurozone . What you mentioned is what is interesting. It is not so much the winner, but the loser was seen as a brussels insider. She was not able to secure this. What you see now and it is something that has been becoming obvious is that the smaller Eastern Europe and the frugal countries have their own agenda. Yesterday. T we saw in terms of the implications going forward, there are question marks as to what this will mean. The irish have repeatedly said that they believe that countries should have a say in their own taxation. They hosed apple. They host apple. Saiduropean regulator has that apple is not paying a enough taxes in ireland. T week, the Recovery Fund germany and france is not enough. Nejra next week, Angela Merkel met with mark yesterday i had of next weeks summit, do we see a compromise emerging . Angela merkel is on a term offensive to try to get the Recovery Funds to the finish line before the end of the summer. Primed meet with the minister of the netherlands, the head of the socalled four who had been playing this very hardball repeating here has multiple issues when it comes to the Recovery Fund. Format he finds problematic and he would like to see a more traditional bailout. Angela merkel yesterday perhaps hoping to reach a compromise and says she believes these reforms are crucial and the countries receiving aid would have to show they are willing to commit to some type of reform. Someroblem is that countries do not want to see anything that looks like a trait that troika. Tadeo in brussels. That is it for bloomberg daybreak europe. The european open is up next. Stocks pulling back for the first time this week and a negative tone for risk assets. The 10 year slipping as well. Dollar stronger. This is bloomberg. Anna good morning. Welcome to Bloomberg Markets european open. Good morning. The markets say time to disengage. European futures point lower as asian equities feel the whiplash of friday selling. The cash trade is an hour away. Here are your top headlines on the bloomberg terminal. The eurozones