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Instant Reaction: Stocks Surge After Trump Statement · Bloomberg Intelligence

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  Speaker 1: This is breaking news update from Bloomberg Instant reaction and
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  Speaker 1: analysis from our three thousand journalists and analysts around the world.
• 0:12
  Speaker 2: The President communicates with the world through his favorite messaging.
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  Speaker 3: It is a very long tweet. I'm going to get
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  Speaker 3: to the key sentence.
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  Speaker 2: I've instructed the Department of War to postpone any and
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  Speaker 2: all military strikes against Iranian power plans and energy infrastructure
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  Speaker 2: for a five day period. Markets reverse and rocket nansdak
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  Speaker 2: up two percent, standard impores five hundred, exploding up one
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  Speaker 2: hundred and fifty points. Pault swinging your interpretation please.
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  Speaker 4: I think a lot of folks has been waiting for
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  Speaker 4: this social media post. At some point, President Trump's just
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  Speaker 4: going to say enough is enough and maybe perhaps think
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  Speaker 4: about moving on.
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  Speaker 3: We are fortunate to have Jaman and Brissetti here, Jamana.
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  Speaker 4: I guess this raises a question in to the extent
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  Speaker 4: that President Trump is looking here as this tweet suggests
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  Speaker 4: to kind of step back and wind down operations in
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  Speaker 4: that part of the world. Is there a sense that
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  Speaker 4: that's the right move at this point, or is it
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  Speaker 4: their sense that boy, the US has broken this part
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  Speaker 4: of the world and to be up for others to
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  Speaker 4: deal with it.
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  Speaker 5: Look, I think there's a big question about what exactly
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  Speaker 5: the US are trying to achieve here in all of
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  Speaker 5: the mixed messaging that has come through this weekend. We
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  Speaker 5: woke up in the morning on Saturday to use that
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  Speaker 5: President Trump was thinking of a military windown, only a
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  Speaker 5: few hours later to put up this forty eighth our
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  Speaker 5: ultimatum to Iran, a threat to attack their power plants.
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  Speaker 5: And we know that, as I just mentioned to you,
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  Speaker 5: that would constitute a real existential threat to many of
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  Speaker 5: these Gulf sites and desalination plants specifically, they have been
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  Speaker 5: putting a lot of pressure, most likely on the US
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  Speaker 5: administration not to follow through on that threat. But at
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  Speaker 5: the same time, the fact that he's pushed it back
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  Speaker 5: by five days suggests that the threat of them acting
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  Speaker 5: is still there. And then equally alongside that they are
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  Speaker 5: own reporting suggests that the US are weighing up the
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  Speaker 5: possibility of taking over karg Islands. I think thousands of
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  Speaker 5: more marines to the region as well, And so anyway
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  Speaker 5: you look at it, it does seem like this war
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  Speaker 5: is going to go on for a couple of weeks
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  Speaker 5: rather than a couple of days. Irrespective of the posts
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  Speaker 5: that he just put up.
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  Speaker 3: Now, Jubona, please stay with us. I have to do
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  Speaker 3: a market check here to keep it going.
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  Speaker 2: Oil plunges, a dollar comes in weaker right now as well.
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  Speaker 4: Also gold Tom Gold is down about three point seven
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  Speaker 4: percent forty four hundred dollars per ounce. Robert Teeter, chief
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  Speaker 4: investment strategist to Silver Crest Asset Management, Robert, you walked
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  Speaker 4: into the door probably with one set of expectations. Now
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  Speaker 4: we're here here with one tweet later or one social
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  Speaker 4: media post later. The world's changed yet again. How do
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  Speaker 4: you put that in context? Yeah?
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  Speaker 1: Absolutely. You know, it's been very much a day by
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  Speaker 1: day environment here, and I think this really speaks to
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  Speaker 1: it as well. You know, you've had a market that
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  Speaker 1: corrected sort of gradually as it went through this process,
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  Speaker 1: rather than some of the prior events we've had where
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  Speaker 1: you had a really big, significant decline and then you
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  Speaker 1: sort of work your way back. And I think that
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  Speaker 1: was the market's expectation that this day would come at
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  Speaker 1: some point, So it was a step by step, day
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  Speaker 1: by day adjustment. Because we sit here today, the critical
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  Speaker 1: element will be if this is a five day window,
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  Speaker 1: do we start to get ships and commodities and oil
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  Speaker 1: flowing through the Strait in the next five days. The
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  Speaker 1: timing sets up interestingly. As I look at it, you know,
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  Speaker 1: this is something that could be contained to first quarter
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  Speaker 1: in terms of any type of disruption that companies want
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  Speaker 1: to blame this on. So if you get oil moving
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  Speaker 1: in the next five days, then I think we're right
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  Speaker 1: back pretty quickly to a pretty normal environment where investors
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  Speaker 1: are looking at second quarter, third quarter and beyond. If
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  Speaker 1: you get no traffic through the straight over the five days,
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  Speaker 1: it's you know, you still have to be a little
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  Speaker 1: bit careful here he.
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  Speaker 2: Did the bond market tell the president what to do?
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  Speaker 2: I mean, at a seismic shift in bonds, the bond
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  Speaker 2: market shifted.
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  Speaker 1: I mean, I'm sorry, bonds lead stocks absolutely. Bond market
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  Speaker 1: a powerful player here. If you want to call it
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  Speaker 1: the bond vigilantes, you could. This is a very strong
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  Speaker 1: message the bond market was sending and saying something needs
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  Speaker 1: to happen and soon. Now we've had commentary before that
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  Speaker 1: indicated that perhaps we were towards the end of the conflict,
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  Speaker 1: and so again for me, it's a one very metric.
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  Speaker 1: I look here on Bloomberg at ecan and look at
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  Speaker 1: the traffic through the strait, and hopefully over the next
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  Speaker 1: few days and weeks we'll start to see some numbers
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  Speaker 1: sticking up there.
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  Speaker 4: I guess if you're the Fed here, inflation was something
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  Speaker 4: that probably had your attention a little bit more than
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  Speaker 4: expected the last meaning maybe this suggests that there may
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  Speaker 4: be a little easing on that front, a little bit
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  Speaker 4: on the at least on the energy sign.
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  Speaker 1: Yeah, I think that's right again, especially if traffic starts
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  Speaker 1: flowing through the strait, then yes, you get alleviation and
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  Speaker 1: oil prices that they're seeing here this morning. That alleviates
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  Speaker 1: some of the stress in terms of commodities across the board,
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  Speaker 1: not just oil but other commodities as well, and the
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  Speaker 1: pass through effect that puts the FED in a much
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  Speaker 1: better spot. I hesitate to say that we'd get back
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  Speaker 1: to normal right away, but I think pretty quickly we
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  Speaker 1: can get back to normal in terms of balanced outlook,
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  Speaker 1: with a bias towards a cut later in the year.
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  Speaker 1: If you get a weak employment print. Our view had
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  Speaker 1: always been that you will get a weak employment print
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  Speaker 1: at some point. It might be a blip and that'll
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  Speaker 1: be what gives the FED the catalyst to respond.
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  Speaker 2: Thank you for our first view of the morning, Robert Tetter,
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  Speaker 2: I greatly appreciate ahead of investment policy and strategy. Silvercrest
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  Speaker 2: Asset Management, Paul I just did a fancy chart off
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  Speaker 2: dal Jones industrial average futures. It's incredibly elegant chart. We
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  Speaker 2: are down in the gloom of perfect two standard deviations
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  Speaker 2: and we've bounced right up to my key middle term
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  Speaker 2: moving average line.
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  Speaker 3: We have a long way to go on the Dow
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  Speaker 3: to get back to normal.
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  Speaker 4: By seeing the Dow up a thousand, you don't see
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  Speaker 4: that every day. So again, market's moving on, trying to
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  Speaker 4: digest what this means in the next several days, of
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  Speaker 4: what it means over the next several weeks.
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  Speaker 3: So stay on it.
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  Speaker 2: Perfect timing to speak with Henrietta, Trey's co founder Veda Partners,
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  Speaker 2: just wonderful on the pulse of Washington. Henrietta, who did
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  Speaker 2: the President listen to? Who did he take counsel from
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  Speaker 2: to make this reversal in policy?
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  Speaker 6: Well, you can really pick your target. It could be
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  Speaker 6: the immigration polling data, It could be the fact that
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  Speaker 6: Congress is not going to pass this two hundred billion
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  Speaker 6: dollars supplemental spending requests for many months now. It could
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  Speaker 6: be the prices that are increasing nationwide. It could be
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  Speaker 6: the fact that you can't you know online the Jones
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  Speaker 6: Act and expected to offset closure of the straight up
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  Speaker 6: Woor moves. But the economic data sets going into a
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  Speaker 6: INTRM election cycle are a problem that you know, the
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  Speaker 6: president created and he has to fix. There's no interplay
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  Speaker 6: with Congress here, so it makes sense that he be
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  Speaker 6: the executor sort of implementing change and winding things back
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  Speaker 6: as becomes completely untenable for the American Republic to support
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  Speaker 6: him going into metroal elections.
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  Speaker 2: But you go right to where I wanted to go next.
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  Speaker 2: Who is the interplay with his an inner circle? Who
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  Speaker 2: is he talking to within his inner circle or is
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  Speaker 2: this a president alone?
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  Speaker 6: I think it's got to be an expansive set on everybody,
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  Speaker 6: from the fundraisers and the donors, to the political campaigns,
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  Speaker 6: the down ballot Democrats excuse me, Republicans, as well as
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  Speaker 6: his own cabinet that is continuing to see polling data
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  Speaker 6: come in over and over and over again saying that
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  Speaker 6: the American public does not support the war. You might
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  Speaker 6: have ninety four percent of the magabase, but you've lost everybody,
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  Speaker 6: including a huge majority of independence. So when you look
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  Speaker 6: at those data sets, it doesn't matter who enters the room.
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  Speaker 6: If it's your energy secretary, your transportation secretary, your secretary
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  Speaker 6: of defense, all those people are getting negative feedback from
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  Speaker 6: the Pentagon to state Department