Its not difficult to be crabby when you are basically living hand to mouth with government stimulus. I thought that encompassed the markets perfectly for a day like today. A lot of earnings coming out. Delta looking at a 50 cut in daily cash burn by the end of june. In terms of their First Quarter loss, they had about a . 51 loss , and revenue was down 18 year on year. As we expected, pretty brutal when it comes to delta. Baker hughes, oil services company, saying the outlook for oil and gas is certain. No kidding. The revenue down by about 4 year on year. 0. 11, acoming in at little bit light. Lets get you some of the headlines here. All of todays market moving news from new york, as will is washington. Brent crude getting sucked into the lowest level since 1999. Bloombergs part two thought to be role bloomberg spoke to thought he be role spoke to fatih birol. Some of the countries are cutting their production earlier than announced. Others joined them. If others do not follow the steps of u. S. , australia and others of putting oil in reserves, we might see further downward pressure on the prices. Alix joining me now with more is bloombergs annmarie hordern. We are still waiting for any kind of official move from the white house. And also axactly, move from houston as well. The Texas Railroad commission, the regulator for the oil industry in texas, they are now on whether orote not they should pro mandate these cuts to may 5. Whats going on in the market is not just a situation in wti. It is moving on to brent, and citi said if storage continues to worsen around the world, brent will follow. Going linked to what is on in cushing, oklahoma, with that storage filling up fast. The first week of may, we could see that potentially filled. India is the worlds third biggest consumer. Their refineries are 95 fall right now. If you want to look at a how muchaccess to crude is out there floating in the world, go to your imap on the bloomberg terminal. Off the coast of california, dozens of ships from long beach to San Francisco bay carrying 20 of global consumption. They are sitting there for days. Incredible. You can see how much blood there is in the world of oil. Lockdowns remain. It is likely to take months to clear the oversupply, and i a famed oil trader. He says large shutins are needed to rebalance, and if the situation can d news could still see the situation continues, we could still see negative prices. Alix appreciate it. Now to washington, where the Senate Passed a 484 billion dollar a package of new really funds of new relief funds. Joining me with Maurice Kevin cirilli. Give us with more is kevin cirilli. Give us the details. Kevin this is a development that is long overdue, and republicans and democrats alike breathing a sigh of relief that they were able to get to that agreement yesterday. From here moving forward, the house of representatives, democraticcontrolled, will vote on that on thursday. Look out for david westins interview with House Speaker nancy pelosi on Bloomberg Television later this afternoon. Two other things on my radar this morning. Now talk turns to the next round of economic stimulus. Look for republicans and democrats to push for some kind of Assistance Program in the next round of funding for the Energy Sector. I am anticipating that vote, which will likely be more politically volatile, and the first week of may. Just within the last five minutes, President Trump tweeting out that he will be signing end is acute of order today signing an executive order today with regards to immigration. We will have to wait for the details of that order to see if it includes some exceptions for certain sectors, like agriculture, and if this is going to play itself out. Busy morning in washington. Alix no kidding. Thanks so much. Bloomberg because david westin will have an exclusive interview with u. S. House Speaker Nancy Pelosi coming up at noon here new york time. Lets get to some earnings out moments ago. Delta shares up just a touch after the Company Reported firstquarter revenue that fell by about 18 , but the company does say its cash burn could decline by 50 in the current quarter. Afterhughes also lower restructuring and impairment charges worth about 1. 5 billion. They say the outlook for the industry remains pretty uncertain. And oil services company, lots of exposure to liquefied natural gas. Also announced a Quarterly Dividend that you dont see that often. Also looking at facebook after the really big solid transaction in india, taking a big stake in the telecom industry, its biggest since it bought whatsapp. Later today, we will also have an interview with the ceo of the nasdaq. That is coming up at 10 00 a. M. In new york. Coming up now, we have more on your morning news, trade and analysis on the markets in todays first take. This is bloomberg. Alix time now for bloomberg first take. Joining me from our inhouse team of wall street veterans and insiders, bloombergs Michael Mckee and Damian Sassower. I just want to start with oil. I know, big shocker. We spoke yesterday about how emerging markets are going cute full force going qe full force, and then we have this oil selloff, putting pressure on china, nigeria, for example. What is the trickledown effect from negative oil prices . Damian i think we are going in reverse here. Mexico had to shut down its wells just a week after refusing those opec cuts. Clearly, the decline in oil prices is weighing on sentiment across the whole of emergingmarket oil producers. Alix is that going to how does that matter materially for them . On the one hand, you still have a global reach for yield, but on the other hand, doesnt make these countries even more or longerterm uninvestable . Damian that is the question. Theres no guarantee that some of these weaker hands in emerging markets are actually going to receive funding. That is the real question here. It is not business as usual. Commercial seeing paper markets coming into play, but the increase in money supply specifically due to quant easing or Central Bank Intervention has not led to an increase in the money multiplier specifically in the u. S. Here. S the real quandary we are doing all we can to stimulate, but it doesnt mean banks are going to lend to those who need it most. Alix that leads me to normally, if you wind up seeing all of qe from emerging markets, we are talking about inflation coming down. That is nowhere near the conversation. Now is it a deflation conversation with oil prices . Oilael not just with prices, but with prices in general. There was a debate when this started about whether it would be a demand or supply shock. With demand evaporating around the world, we may get there, but the problem is nobody wants anything, so stuff is piling up. That brings the cost of it all down. You will see oil prices depressed for some time. The interesting thing is going to be and how we measure this because the Consumer Price index is generally a Market Basket eights each commodity by the amount gets used. How often do they update that . We could see an overstatement of the impulse Going Forward. With oil prices down the way they are, dont expect numbers to go up. For 10 years right now, we are expecting only about 0. 5 inflation, or at least wall street is, and that is not going to worry anybody in terms of inflation. When we get back to work, if we get back to work any time soon, we could Start Talking about the world and whether that is going to be inflationary. Alix im coming back to work. You cant keep me broadcasting from home forever. It does lead me to Central Banks and any kind of government stimulus. All of this low inflation makes these large fed purchases of treasury debt sustainable, and theres this indirect monetization. But its ok, but because it would not be inflation that we are worried about. Michael thats been a big break for the Central Banks and for the world, that we didnt come into this with inflation. You will have all these loans out there that the Federal Reserve and other Central Banks priced at zero, so it is going to be very hard for them to raise Interest Rates any in the near future because all of the people with these loans will have a hard time paying the back. Expect this kind of thing forever. Walks like a duck and like a duck, quality platypus. Like a duck, call it a platypus. They dont want to spend too much money, so did can use the ecb program and put all those on. S from italy in the long run, that is essentially what youre doing. Alix i love it. And to tie the two worlds together for you, i wonder if the ecb is discussing buying junk bonds today. If that actually happens, how much does that push out to e. M. Somewhere . Damian it is going to be really challenging. The emerging market has its work cut out for it. If you look at some of the comments from the sec chairman, he is kind of lambasting china for not maintaining adequate standards of investor protection. This kind of build on all of the accusations that covid emanated from china and they are covering it up, all that kind of stuff. From an Investor Sentiment standpoint, it doesnt bode well for emerging markets. Companies have raised billions of dollars was on the equity in the credit side. Coffyou see the chinese ee chain posting an accounting scandal just after one on the nasdaq, it builds on the fear that investors might have about plunging into emerging markets, despite the selloff. Alix i just want to clarify, i mentioned ecb buying junk. The conversation today is whether or not they put up junk bonds as collateral. Is that actually make any material difference in europe, especially as eu leaders head into the summit tomorrow . Michael this all falls into the when they put in that pet program, they agreed to take greek bonds as collateral. The question is, do you expand that to italy if italy gets downgraded . They are one level above junk in many of the rating agencies, so if they downgrade italy, the ecb has to decide, is this going to be a policy that we continue to take dunk Going Forward, even if the economy starts to improve . They have a decision to make, but the bedding is if they need to, they will do what it takes. Where i heard that before . Alix exactly. What is the thing you are looking at today, the next 24 hours . Allan my concern is that these facilities by Central Banks do not replace lost earnings. They are going to lower yields, but it doesnt guarantee that the credit markets will be open to these issuers when they need to refinance debt. That is why you are seeing all of these bifurcations between spreads, and those that see policy support and those that do not. , mike, appreciate it. Any charts we use for the next two hours, go to gtv on your terminal and you can check them out. Coming up on the program, netflix tells investors weve got explosive growth, but dont get too excited. We will speak to matthew harrigan, an analyst over at benchmark. This is bloomberg. Viviana you are watching bloomberg daybreak. At t joined a list of companies that have withdrawn their forecast for the year. At t revenue coming up short. Profit was in line with expectations. United airlines is stepping up efforts to survive a collapse in demand. United has raised 1 billion by selling new shares. The price was at the highend of the marketed range. The government stepping in with 50 billion in grants and loads for the airline industry, but carriers are still trying to raise more cash. Netflix is warning investors not to get too excited. The Largest Online paid tv network posting the strongest Financial Result in its history. It added a record 15. 8 million subscribers. Netflix benefited from the coronavirus pandemic. Millions stuck at home signing up. Netflix expects the surge to e at the expense of future growth. Alix for more on earnings, matthew harrigan, benchmark analyst points us now. Because when everyone was upgrading netflix and everyone super into net during this pandemic, you actually have a sell rating. Walk me through why here. Matthew you have to differentiate between a Great Company and a stock that was very extended. It is perceived as a covid19 safe haven. Theres an element of truth in that, but it might be a little overhyped. Targetls on this price with this type of risk envelope that is not a thrill or upside when the stock is in the low to mid for hundreds already, we did think that the subscriber number would come in great for the quarter. I thought there was a chance there would be 12 or 13. I hope the stock might coming off that. Instead it was almost 15. 8. Some of the gross in the second half and probably even pulls forward. Theres also a big gross component a big growth component. Of course, those subs are of lower value than the u. S. Or european subs. I dont think that got as much attention as it should have on the call, but that was another contributor to the absolute blowout in the subscriber number. But there wasnt that much of a beat on the financials or on financial guidance, so we did bump our price target to 340, but we still have a sell rating. A remarkable company, but that is a more fully discounted stock price at this level. On theo you have a read subscribers they did book in the First Quarter . Are they going to go off and get another service instead, or do they stick here . Impossible tos ascertain. The company was forthright in saying that some of the guidance is a guesstimate. They are hyper sophisticated on the modeling side and consumer behavioral side, but my gut , and certainly the company intimation is that you will have some customers rolloff on the second half because people do get bored. I think beyond the competition in streaming services coming from hbo max and peacock in may, as well as disney plus and , netflix does have a lot of content. They mostly are in postproduction for almost all of the 2020 content, so we will see how the lockdown proceeds, but i think we have probably seen the lows for a while at least. Alix you mentioned content, so i am interested to see what you think of margins. You mentioned they make less where they have more room to grow in emerging markets, but at some point they will have no money to spend because they cant go into production because of the virus. What does this do for them on the shortterm . Matthew they are doing select things on the production side, a lot more in the animation and reality show side. Trying to something trying to the witcherike for 21 a1 is more difficult. If you do get a freeze from covid19 that affects everybody, i think they are in a better position than some of their scary and it is something that everybody has to try to adjust for this environment. Alix totally right. I cant imagine love is blind 2 animated. Matthew harrigan, benchmark senior analyst, thanks a lot. It was a call i had to read three times yesterday in my inbox, 3000 gold. Francisco blanch, bank of america head of Global Commodities research, will be joining us next. Also taking a look at some of the airlines that have trickled out today. Baker hughes taking a hit on its earnings, cutting. Capex. Ing delta looking at cutting about 50 billion actually up by 2 in the premarket, almost 3 . This is bloomberg. Alix welcome to bloomberg daybreak. Im alix steel. S p futures are up by about 34 points. In europe, still seeing a rally as well. I also wanted to check in on italian equities. They are also higher. Yields continue to pop here. The 30 year is now over 3 . The 10 year pumping another 10 basis points. We have the eu summit meeting tomorrow. The ecb discussing whether they can use junk debt as collateral to help offload some of the pressure from the individual countries, like in italy. Still more questions than answers. In the u. S. , youre are still right around record closing rose for the 10 year. Higher. W slightly it is not that big of a jump, but nonetheless, a reverberation in the oil market if you try to get any kind of bid here. I want to highlight some news here. The Eu Commission may seek to raise about 320 billion euros to finance the recovery, a draft proposal on a new eu budget. Always, the question is who and how are you going to get to pay for that. Spain floating a perpetual bond to pay for all of the Recovery Efforts in the euro zone, which kind of leads me directed to bank of americas call of gold at 3000. A route yesterday in a note, they wrote yesterday in a note that investors would be pushed into gold, looking at 3000 over the next 18 months. Francisco blanch, b of a securities head of Global Commodities research, joins me now. I couldnt believe you actually made a call for 3000. Walk me through your thesis about why you made it. Core is really that Central Bank Balance sheets are going to double, fiscal deficits are going to double, and we are going to find debtlves with a lot of being effectively socialized. Situation for the at least the last 10 years, were Central Bank Balance sheets is a share of gdp have been 21 tively stable between and 28 of gdp, which has also been a stable period for both prices. Now we see this ballooning of Central Bank Balance sheets and deficits, and gold is the only part of the Central Bank Balance that is nobody elses liability, essentially. Everything else they hold is someone elses liability. It is your mortgage or a piece of somebody elses security, or a piece of pension fund liability. It asially, we still view a core part of the Monetary Base , and that is why we think i