S p 500 higher. Groups leading gains include stayathome stocks, consumer services. Oil after inventory close to 41 per barrel, big drawdown way more than anticipated. The 10 year yield up. The dollar index continues to weaken. Plenty of strength in euro. We will talk Canadian Dollar in 10 of 1 after the decision from the central bank. Ministers agreed to boost oil output. This will be offset by members that did not fulfill commitments in june, such as iraq and nigeria. The saudi minister sees a ceiling. Ellen, this was the deal agreed to by members. Will that have any impact on members for those countries so dependent on china . Ellen that is a huge question. According to the saudi oil minister, not a single barrel will be exported extra in august compared to july. He perceives saudi arabia will consume extra barrels produced domestically and while the price people in saudi arabia pay for oil cost has gone up recently, it is not merely what the saudi government would get if they were selling barrels on market. They get money for every barrel produced. It is not that much in revenue. Interesting. Insees increasing demand saudi arabia but there is a question of whether he is covered the fact that if demand is not up in saudi arabia, the saudis plan to produce products and dump those on the market later. We could see those barrels coming onto Global Market anyway, in other forms. Ifould not be surprised there is some measure of that with russia. Russia assured everyone they would produce more but everything will go into domestic consumption. Important to question that and whether russia will be able to keep itself from temptation to export, particularly because its blend is in high demand and creating a premium for brent. Vonnie what about the u. S. Oil patch . A lot of difficulty in recovery in prices. Do we see output gains in the u. S. . Ellen a very mixed picture. According to the eia, production is 11 Million Barrels per day. It seemed to decline more than that earlier in the summer. That may have been because of shutdowns in the gulf of mexico due to a Tropical Storm situation. We can expect more of that, given they are predicting an active, average hurricane activity season this year. The bag is mixed. At the 40 range where we are for wti, there are some parts that are capable of returning shut in wells back online, potentially drilling more and then there are firms that are facing bankruptcy. It is an uneven picture in the shale patch. We could see declines. They will not be across the board. Vonnie you are the author of a arabia dealing with the perception of aramco. Where is mbs these days . We saw a lot of him before the Jamal Khashoggi killing. Is he stable . Him at a are seeing lower profile now. That is not unexpected for the summer, when sometimes things lay low. We have seen internal activity. Previous years as well. We are seeing more money being put into megaprojects in saudi arabia like neyo, their big Entertainment Center and other projects and we are seeing money coming out of the social welfare programs saudi arabia has for its people. The plan is to scale back the citizens account. In july alone, 1. 3 Million People lost payments from that program. That is hitting citizens hard, particularly people dealing with economic effects of lockdown, job losses in private sector, reduced business in the gate economy. This could produce resentment on the part of people who are having trouble affording food, gasoline, etc. Meanwhile they see announcements these megaprojects designed for tourism, is really not going to appear and do anything for the saudi economy for some time. Vonnie what is happening to his vision . Do we see changes to strategy . Can he try to pivot the economy away from oil . Ellen part of the problem with the focus of the pivot was they were planning to ramp up tourism and try to attract outside tourists to saudi arabia, which is a compelling thing. The country had been very closed to outsiders for some time. Problem is Global Tourism industry is in the bucket. No one wants to fly. If they are going, it is probably not to saudi arabia. They are trying to focus on domestic tourism. Getting saudis to do tourist things in saudi arabia. That will prove difficult in a domestic economy hit hard by coronavirus and decline in oil prices. I am not sure where he is going to get the money to continue to pursue this pivot. I would not be surprised if we see things fallout. Vonnie interesting. Thank you very much. A check on the first word headlines. Mark the Trump Administration has reversed itself on visas after a highprofile fight with harvard, m. I. T. And other schools. The government originally required International Students take one class on campus. Many colleges are preparing online instruction only. Next step for the experimental vaccine, a much larger late stage trial this month. Antibody toproduced coronavirus for the first time, increasing hopes a vaccine could be brought to market quickly. Ruth Bader Ginsburg is in the hospital, being treated for possible infection. She is a fourtime cancer survivor. She was appointed to the court, 1993. Global news, 24 hours a day, on air and on quicktake from bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Vonnie this is Bloomberg Markets with breaking news. Indicated mp as has indicated he does not want to further escalations with beijing, ruling out any further sanctions on top officials. They have created a list of officials who could be targeted. This morning, mike pompeo signaled there would be visa problems for huawei workers. It is making a difference. Stocks popping higher on the news. We discussed shareholder jim, talk to us about the findings. Mixed for hedge funds. Some doing extraordinarily well. Some bombing. Jim that is reflected in our first half report. Global Campaign Activity first half 2020 down 10 globally but if you look at the u. S. , activism campaigns fell off a cliff dropping 40 first half, primarily driven by covid and worsening returns. Year,cap companies, last 15 with market caps over 10 billion targeted. This year, only three of that size targeted. Activists are sitting on the sidelines now in the u. S. Vonnie why is that . The first halfut is not that different from last year. Activity on the board front. Why were there not more campaigns . Is it just lockdown . Jim i dont think that is it. The issue now is there is uncertainty around valuation performance of companies in u. S. And uncertainty around the depth and length of recessions. The activist hedge funds have highly concentrated portfolios, predominantly long only positions. Given the uncertainty in market, the tendency has been to hold back, work on existing campaigns and that is why you see the board seat numbers have not fallen. Activistseats won by in the first half. Star board and elliot were at the top of the list. They took 29 of 86, almost one third, and those were all campaigns precovid. Focus is on existing campaigns. In terms of new launches, we have not seen the return. Vonnie we have managers turn into offices. There were retirements. Right. At is we will see more closures before this is over. Trend we have a been watching carefully the last couple years is the total number of activist hedge funds and total new entrance. We have had a few funds drop funds this the hedge year were led by new entrants. Moves into inclusive capital to source new capital for the environmental and social objectives of funds. That is in line with other activities. Activists, to find new pools of money. Franklin on the go at this point. That vehicle, whether the traditional version, the newer version, the european model, the canadian model, has become extraordinarily popular. Is that because it is difficult to find value for Hedge Fund Managers . Jim it shows activists being opportunistic. There is demand by private companies who want to go public. They dont like the prospect of the multiweek beauty contest trying to attract 60 new investors. You only have to negotiate with one party to go public. The activist hedge funds have noted there is a pool of capital available. They say they will be focused on private companies. This capital will be available for variety of transactions and who knows where it will be deployed . Maybe it will be in investing in public companies. For now, we think they are filling a gap in the ipo market. Vonnie it could be used for all sorts of things. What about on the nonequity side . Activism. Ee as much some activists, and i would call out elliott, are particularly effective of entering capital structure through debt market and later buying equity and pushing for change that way. Larger activists have turned focus to credit markets. Volatility in credit market provides opportunities to make returns in days, weeks, months. Playing the traditional activism game is a multimonth, sometimes multiyear project to turn around a company, like your private Equity InvestorHolding Management accountable, improving the business by simplifying portfolios. That is a longer game. Days like this where the market can be surging like the past few days or dropping significantly like a few months ago, it is easier to play the credit game than it is to play the long game in fixing companies in public markets. Vonnie a lot of campaigns and retail, whether in the u. S. Or europe, how does this whole pandemic environment change the quality of campaigns and will activists flee . Jim it will take a brave activist to enter those sectors. In fact, the distress you are seeing in certain areas, travel, real estate, retail, which you identified, areas activists will avoid in the next six months. We are focused on industrials, technology, health care, Business Models durable through the crisis and attracting m a interest. On the heels of this, you will see resurgence in m a, second half of the year as people step back and see who has been impacted by covid. Who are going to be the new winners and losers in the market. Always, fun talking with you. Exciting time ahead for activism. Stayathome stocks, how the best performers are looking different than usual because of the pandemic. This is bloomberg. Vonnie stockmarket reflective of pandemic conditions. Meredith and matt on this today. We are not surprised at netflix. Talk to us about this new breed of stocks. Surprising is the top 10 winners during Second Quarter among the largest 500 are Companies Increasingly setting a course is a new breed of stayathome stocks. C. Ta dog in tools andonitoring log management for cloud computing. San Francisco Cloud computing 145 . Ouse up spotify needs no introduction. Stockholm based. Square inc. Up 100 . Paypal familiar to people, up services,ding payment enhancing all my payments. Cusign up 82 , reducing the need for in person contract signing. That is something we will be making use of as the days get longer. Vonnie exactly. Companies on the up and up anyway. Almost like this provided investors with a chance to put their money where their mouth was. Ay have already been interested. Do they hold onto gains . Matt i think so. It is about efficiency. Investors get excited about future and how it will become more efficient. That is the way commerce operates. These companies are all about greater efficiency. One of them i did not mention was sunnyvale, california, crowd 80 ,e holdings inc. Up providing cybersecurity platforms. All the companies i mentioned are clients of them. The mother of them all is tesla, up 106 , Second Quarter, the largest automaker, earlier this month. What is that about . Batterypowered, zero emission vehicles. Everybody gets that. The undisputed leader in online sales, touchless delivery, perpetually downloaded vehicle enhancements. What automaker does that . Space. Wns that those are things that are not going away. Vonnie for the first time, u. S. Stock market gone up led only by those who think coronavirus is here to stay. Chinese companies at the forefront of technology, benefiting from this buoyancy. I urge everyone to read the column. And matt. To meredith canadaup, thank of pressing benchmark Interest Rates near zero bank of canada. This is bloomberg. Mark i am mark crumpton. China is warning United States to stay out of hong kongs affairs after President Trump kongs an end to hong special status with the u. S. Apple has won a court fight with the European Commission over whether it must pay ireland 15 billion in unpaid taxes. The decision comes after the commission ruled in 2016 the tech giant benefited from illegal state aid i in the form of rulings from the irish government. Irrespective of this judgment, there is a fundamental question about tax fairness. How it can be considered fair in front of one of the globes Largest Companies was able to pay at most 1 tax on its european profits, and many years they played substantially less that 1 . Mark apple said it was pleased by the decision. It is not about how much tax it pays, but in what countries. President trump got his revenge. His chosen candidate, Tommy Tuberville beat jeff sessions. He was an early trump supportable in the senate, but after the president named tim attorney general he turned on sessions because sessions recused himself from the russia investigation. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. I am mark crumpton. This is bloomberg. Amanda welcome to Bloomberg Markets. Vonnie we are joined by our bloomberg audiences. Canada pledges to keep its benchmark Interest Rate at nearly zero until inflation is targeted sustainably and sustainably achieved. It will be a long climb out of the economic recovery. He will be speaking with amanda later on. s. The Health Insurance marketplace is now down 7 . Vaccine hoax. Moderna reaches a record for more clarified results. Results came out a few months ago. Lets get a quick check on markets. Impossibly, hopes for a vaccine that are driving things. We are seeing a little rotation out of the leadership of this market. Tech remained a little weak. We are building strength. The s p 500 is gaining as we go along. Energyials, materials, are moving sharply higher. It is the strong Growth Stocks that led this market that are weak today. Discretionary, communications, all of the downside. The Canadian Dollar reacted a little bit. The messaging from the central bank is that we will remain low for long. He wants both businesses and consumers to know. 25 , the rate will stay low. We are not going negative in canada. Because of the uncertainty of the economic recovery he wants businesses and consumers to expect the rate to stay low and act accordingly. He acknowledged the road is definitely bumpy. It will be a long climb back. The bank of canada will be there for the full length of the recovery. Absorbednomic slack is so we achieve our inflation target. The message is Interest Rates will be low for extended period. Doug porter is the chief economist at bank of montreal. Messaging that is in keeping with other central banks. The nationessage is is indebted and worried about Household Indebtedness in canada. Was this a wellreceived message at this stage of the pandemic . Doug well, i think there were two key messages we wanted to deliver. The bank had no intention of going negative and rates would remain low for probably at least until 2023. As a reminder, if you think back to the last cycle, the bank of canada was one of the first to start raising Interest Rates. They were raising rates as early as 2010, way before everyone else. One of the key messages is that will not happen this time. The other message is that looking through all the uncertainty, the reality is they are more cautious. Did feels like there has been plenty of proclamations of gloom and doom with canadas deficit expanding so much in the gdp ratio broadening out. The market seems to have accepted this decision handily. The Canadian Dollar is stronger by. 7 . Doug if we stand back and look at the fiscal situation, we are the country not looking at a budget deficit on the order of 10 , 50 , or larger percentage of gdp 15 , or larger gdp. Up, justs all counted about everybody took on a similar amount of debt in 2020. Canada started in a somewhat better situation. I suspect fiscal policy is not going to look that different when we compare country by country. Supporting the Canadian Dollar today, besides the fact the bank was not super aggressive is we have this ongoing recovery in commodity prices. We have seen more firmness today. In some sense that has changed the narrative in terms of who faces the bigger risk, the u. S. Or canada. I think the balance is fully tilting to a situation where the u. S. May have more downside than canada for the second half. Which has implications for canada, doug. One of the scenarios the bank laid out is that we dont get a big setback in the pandemic. There is no massive second weight and we are not shut down again, is it logical for economist to assume that . Should we be factoring in the fear that could happen, especially based on what is happening in america . Doug i think this is a case where you need scenarios and you need to take each one seriously. A fullscale second shutdown. It is quite possible. The governor suggested we could get some minor second waves. Believe theyid, i are forecasting theyre forecasting is adequately prudent. Forecasting is adequately prudent. Harking back on the u. S. , their forecast for the u. S. Was a bigger than a percent decline this year. The latest consent is consensus is more light 5. 5 drop. Vonnie what i