Impact of the virus. We will hear from the investor this hour. Western europe loosens restrictions and says infection rates are using. This highlights systemic weaknesses in the Global Health systems. Shery looking at markets, futures under pressure. U. S. Futures are down. 4 after the second straight week of gains. This coming at a time we are hearing from government officials in the United States the worst may he over for the coronavirus pandemic. Nikkei futures down. 4 . We are going to get march trade data for japan later in the show. Nikkei futures are already at a sixweek high. Seeing downside for oil. 4 while brent is trading at 28 a barrel. This of course after we continue to see this gloomy demand outlook when it comes to oil. President trump is slamming china yet again, suggesting beijing caused the covid19 outbreak that has killed 39,000 americans, and said there should be consequences if the country was found to be responsible. Ros krasny is on the line from washington. We are hearing from Vice President pence, they might be looking into this at the proper time. What are we expecting . Ros i dont think you will hear or see anything specifically anytime soon. I feel like this is a line of rhetoric President Trump is taking up to appeal to his base and really adopting more fringy. Cringy views tom cotton, senator from arkansas, has been talking about this for a couple of months. Seems President Trump, whos back is against the wall because of the coronavirus response, is looking for something that would appeal to his hardcore supporters. I dont think you are likely to see an investigation opened. Tois leaving the door open chinas leadership and saying what is happened what has happened. Haidi we have seen australia saying if there is an investigation into the origins of the virus, they would want to be involved as well. What are we seeing in terms of President Trumps culture war against public health, given the threat, followthrough, cutting funding for the w. H. O. , and liberating certain states . Do we have consensus of how the states are dealing with how a potential opening might happen . Ros each of the states has been left to its own devices, make certain they are meeting certain and sparks. Listening to the governors speaking on tv, they say they dont have enough testing to make this happen. They dont feel they can move through the different phases. At the margins a number of states are taking action. Ohio will open up some of its businesses may 1 and restaurants may 15. Each state will do what it feels like. We had encouraging statistics from new york. I think you will see regional blocs moving in a certain direction, northeast, western states. President trumps rhetoric has been curious. He tweeted friday liberating minnesota, michigan, taking aim at states with democratic governors. One democratic governor today, washington state, said trump is sounding schizophrenic, to talk steady,e study benchmark driven reopening but then also liberating states. It is something to appeal to his base in a curious way. Up. Y rhetoric heating what about stimulus funds . We could get a breakthrough on topping up the Small Business loan funds. How positive is this . Ros definitely. We heard from the major stakeholders in that, the treasury secretary, ecig lucy and chuck schumer. We believe there is an agreement nancy pelosi and chuck schumer. We believe there is an agreement late tonight or tomorrow to have something later in the week, talking up theppp the ppp program. The hospitals is something the democrats have called out have held out for. Maybe the republicans have come around to Nancy Pelosis condition. We dont have a deal yet, but we believe there has been a lot of talk on the hill today and a Conference Call with mitch mcconnell, Stephen Mnuchin and with trump. We may hear about that when the president speaks at his briefing this evening. One thing the democrats want is to try and look at the program that was exhausted in terms of funding so quickly and say, how can we really get money to the smallest of businesses . A lot of publicly traded Companies Got got a lot of fines from the program. If it was aimed at helping mom salon or pizzail joint, democrats want to see money set aside for that in the next go around. That will be interesting to see if that emerges from what comes out of congress. Thank you for joining us. Ros krasny in washington with the latest. Bringing you the latest comments as soon as the press conference gets underway. We are getting chinas response to trumps criticism over beijings handling of the coronavirus crisis. We will speak to the asian head of the largest food Contract Service company about the impact of the virus on his business. Shery you are watching daybreak australia. Virus cases in india have surged with 1400 new infections, taking the total above 16,000 as the nationwide lockdown enters a fourth week. Confirmed cases arising and india steps up testing with known infections up 78 in the last week. The true number could be higher with only 370,000 of indias 1. 3 billion people tested so far. Indonesia is tightening virus restrictions, extending curbs on many people as infection numbers rise. This will affect 9 million more people as the virus continues to spread. Indonesia has recorded the biggest daily increase in cases since numbers were first reported in the government has extended this to cities around jakarta. There is a decline in western europe with the fewest confirmed deaths in several weeks. Coronavirus fatalities in spain ose to 420 italy reported the fewest deaths in a week. And france rose at the slowest pace since the end of last month. Germany and the u. K. Also show improvement. E. U. Regulator so the dramatic falloff in passenger traffic across the bloc. Lockdowns and the collapse in demand have slashed flights in western europe amid the coronavirus pandemic. The leading airports are now handling as much as 90 fewer flights compared to a year ago. China has hit back at u. S. Criticism over its handling of the coronavirus. The state media are getting the Trump Administration of shirking this possibility by blackening china. Tom mackenzie joins us from beijing. We saw President Trump gobetween strong praise to chinas handling of it and now string of attacks. Tom beijing is punching back. State tabloid came out with an editorial. It accuses the Trump Administration, shifts the blame of what he characterizes as a botched u. S. Response to the virus, pointing at huge numbers of virus and death. They talk about certain governors and restrict arguments with the president. This bythe handling of the Trump Administration has been miserable and trump and his team are trying to win reelection in november by stepping on china. And rather than bring the u. S. And china poster, this exacerbates the existing intentions and the lack of trust between the two. We heard from one person who with the world health organization, in a phone call with the head of the tamira job, said attacks on the organization by the u. S. Were baseless. China would step up its support. We are trying to understand the complete spread of the disease. How is china doing that . Tom it is carrying out a survey which involves blood samples from a Representative Group to see if they generated antibodies to fight the virus. That could be a sign they were infected. And it is hoped scientists could get a clearer picture of the spread of the disease in the broader population. It could give more information how the virus is transmitted about people, including children. There is a lot of unknowns. China is pushing back. , andintelligence reports criticism from other countries, that it could feel the extent of the virus. They had provided data a number of times, the latest last week when they added 1200 thats to the official count. China is trying to show it is transparent. They are trying to control secondary outbreaks on the border with russia which is concerning officials here. Haidi we are getting chinas loan prime rates to be announced today. Tom the one year rate, the expectation is we will see that rate drop. The reference rate, bank loans to companies in china. It is expected to fall. 20 basisdrop of points. They see it probably 3. 85 . The loan prime rate could fall as well. This is after the pboc cut lending by basis 20 basis points april 15. We saw that with reproach rates being trimmed repo rates being trimmed. It is part of this push by officials to loading officials to lower funding costs. Costs tofunding support the economy which remains in a miserable state as it tries to get back to the second or third year as the virus is controlled in china. Tom mackenzie in beijing. Unprecedented support from Central Banks and historically low Interest Rates are among the factors pointing investment in growth assets like global stocks. Our next guest shares his outlook. This is bloomberg. Shery breaking news, we are seeing oil fall to the lowest level since november 2001. Look at what wti futures are doing. We have lost a percent on friday, extending slumps below 20 a barrel, below 19 barrels 19 a barrel. It is a very gloomy demand outlook. Saudi arabia and russia signaling they could be open to further output cuts, but we continue to see this slump in demand as the coronavirus outbreak continues. ,. S. Futures under pressure. 7 . This coming at a time when stocks posted a second week of gains. That would be the longest run since midfebruary. Joining us now is the executive chairman john hurdle. We see u. S. Futures accelerating losses as we are seeing brent, wti take a big hit. I wonder if there can really be sustainable Market Recovery as we see u. S. Stocks rallying last week, the week before that, when we are not seeing a stabilization in oil prices. Oil prices are one factor but only one factor. Looking at earnings, they are going to be lower than last year. 160 for they were s p. Today looking at the 2850 on the s p 500, even if we use earnings at 150, that would be 19 times, which is not it is above the average multiple. At this level 2800, we would be trimming some exposure to stocks, even though we think in the long run it is the place to be because Interest Rates are so low. Shery there is so much uncertainty, but one thing we know, rates will stay low for longer. When you are a longterm investor like you, what do you do with that . Weis no question that are the chief investment officer. We are working for families and College Endowments all around the country and some around the world. They need those growth assets to fulfill their missions, provide for families and fulfill charitable missions. So with the situation where there is no alternative. Fewerportunities become and fewer. But Interest Rates are likely to stay historically low. That is a major factor and it will continue to be. The Federal Reserve and other Central Banks around the world and Treasury Department are doing everything they can times creditmake sure the system stays in place. That is a big risk we dont have to worry about. Not like 2008 where the Financial System was at risk and we were making up response. We can now look back at the last crisis, take lessons and move. The fact they are so aggressive about supporting the Financial System is a major positive. Interest rates are a major positive for stocks. There is no asset in the world that is a good investment at any price. It is always about price. 150 earnings on the s p we dont know what the earnings are likely to be, that is not cheap. You need reason for concern at this level. You said for your plant portfolios, growth matters. Growth stocks have done well when you look at tech. But russians are not cheap. Would you be valuations are not cheap. Would you be extending with the longterm outlook . Growth i use the term assets, i mean all stocks. Certainly Growth Stocks and things like stock growth as a service and Online Retailing and so forth have done very well. They are winners, especially the strong entities. They are not even really down after all of this crisis. Hey are winners and losers they are clearly winners. And in the loser department, energy and retail, there will be winners and losers as well. We need active managers to sort through and figure out who the winners are, the survivors, where all of this disruption is. This is a market where at one level we will have the big, Strong Companies like microsoft continue to do well. Looking at the price, they are not bargain prices. Below that among the losers, you need active managers to select from that group, from that group of stocks to find out who will win and who will lose. You make a point about this crisis in different even though there are lessons to be learned from the financial crisis. Being a shock to the system, how useful is that playbook . How much is there a risk to the outside we get an end to the pandemic sooner than expected, that therapeutics improve and we see reopening . We have got policymakers and Central Banks doubling down on their efforts. How much of that adds to the upside . There is no question the market has been looking past the earnings valley. This is one of the reasons we want to look at asia to see their experience. We see in south korea how well they have controlled the pandemic and in germany. We are looking at singapore to see how they control flareups. We are still dissenting into this valley. Descending into this valley. We see land on the other side because we see it in countries ahead of us. When we come out of us, and what we know now, people are looking past that, thinking about low Interest Rates, we have to buy stocks. One by now . We believe there is too much uncertainty at this point. The depth of the valley in front of us is unknown. We are largely exposed. As longterm investors, we have strong commitments to growth assets like stocks globally. In a portfolio that was 70 stocks, the least we would get down to would be 65 . We are not jumping in and jumping out. That is speculating. That is not a longterm investing. That is rambling. There is no certainty. Certainly lives in the land of retrospect. We are looking at modest, logical shifts that trim around 2800, add around 2200 and we select among the opportunities. Thank you so much for your time with us. Just an update when it comes to other big lenders in australia, one of the big four banks reporting the firsthalf earnings will be reduced by several challenges, listing items impacting the first half of 2020 financial results. There is a net increase in remediation matters of 268 million australian, pretax number. There was a change and reduction in earnings. The capitalization policy will reduce earnings by 742 million aftertax. Just a bit of an update. Tough times for the aussie banks in a lot of the coronavirus outbreak, all four of them being cut to the various ratings agencies for their outlook as well. The Aviation Unit of the bank of china will provide 22 boeing planes from United Airlines and lease them back. This Division Group will take six dreamliners and max jets as the Airlines Seek to reduce regular outgoings as the pandemic cripples demand for flights. The deal is expected to close before the end of the year but no financial details of been disclosed. In japan arers delaying the launch of the new iphone. The decision is to be driven by the governments nationwide state of emergency with people order to cut personal contact in a bid to curtail the spread of the virus. This is bloomberg. Teaming a great job, this is. In court includes the army corps of engineers, admirals, generals, one of the great admirals here has done an incredible job. You havent slept much. Look at him. [laughter] somebody said to me, president , you look tired. We should all be tired, but we have to win. Tomorrow the president , the Vice President will lead a call with our nations governors from fema whatuarters, to review more they can do to develop locally tailored testing strategies. Working hard with governors on testing. We will send them a list of the. Arge Laboratory Machines they have a lot of machinery some are not aware of, but they are highquality machines. The potential capacity of those machines, if they are fully utilized, some of them didnt know they could be utilized in a different manner. Many governors are relying on state laboratories rather than the full and much larger capacity that is available to them. Commercial laboratories such as these arelabcorp, massive laboratories that can handle a lot more than they are being sent. A few days ago it was only 30 capacity. Now probably the same. In addition, academic laboratories, big research labs, there is tremendous capacity out there. Some of them want the past, the it instant abbptott machine. These labs can handle much more than the machines, the smallest can handle. We continue to procure millions of swabs, test collectors. I have something here. I happen to have the swab. Looks innocent, not very complicated. Anybody like to see what it looks like . Open it up. I will. I will. This is what it is about. You of something . Of this. One is a swab, one is a qtip. It is very sophisticated actually, but it is a little bit. Ike so this is the swab we have ordered a lot of them. Some of them, the states, they were shipped in the states dont know where they are. That is it. Why dont we give this to karen . This is a big deal. We are working on it and working with the companys, and i think in the end we are going to have a tremendous success. Nobody is close to us. No country is close to us. I appreciat