Stocks Get Tech Lift Despite Renewed Bond Losses

>> THIS IS "BLOOMBERG BUSINESSWEEK DAILY," REPORTING FROM THE MAGAZINE THAT HELPS GLOBAL LEADERS STAY AHEAD WITH INSIGHT ON THE PEOPLE, COMPANIES, AND TRENDS SHAPING TODAY'S COMPLEX ECONOMY. PLUS, GLOBAL BUSINESS, FINANCE, AND TECH NEWS AS IT HAPPENS. "BLOOMBERG BUSINESSWEEK DAILY" WITH CAROL MASSAR AND TIM STENOVEC, LIVE ON BLOOMBERG RADIO, TELEVISION, AND BLOOMBERG ORIGINALS. CAROL: GOOD AFTERNOON EVERYBODY. YES INDEED, WE ARE A CROSS BLOOMBERG -- WE ARE ACROSS BLOOMBERG PLATFORMS. I AM CAROL MASSAR ALONG WITH NORAH MULINDA. TIM IS OFF THIS WEEK. HAPPY TO -- NORAH: HAPPY TO BE HERE. CAROL: A BEAK THAT FEELS AWESOME TO THE MARKET. NORAH: STOCKS ARE HIGHER BY 0.7%. BUT LOOKING AT SOME OF THE STORIES, TREATING THIS KIND OF -- TRADING IS KIND OF MEH. CAROL: A LITTLE BIT OF THIS AND THAT. WE WILL TALK ABOUT THE MARKET, U.S. YIELD. COULD IT BE THE U.S. IS A SAFE HAVEN? WE WILL TALK ABOUT THAT AND THE TIGHTER FINANCIAL CONDITIONS WE ARE SEEING IN THE U.S. I THOUGHT THAT WAS AN INTERESTING REPORT BY OUR BLOOMBERG COLLEAGUES. ALSO, HIGHER RATES. THIS IS A GUEST YOU BROUGHT TO US. THE REAL ESTATE MARKET CARES ABOUT THE RATE ENVIRONMENT. NORAH: EVERYBODY CARES ABOUT THE RATE ENVIRONMENT, BY SPECIFICALLY REAL ESTATE. THAT DRIVES EVERY DECISION IN THIS MARKET. CAROL: THEY ARE PIVOTING. WE HAVE A LOT TO GET TO. WE WILL TALK ABOUT THE GROWING BUSINESS OF GROWING DIAMONDS IN A LAB, SOMETHING WE HAVE COVERED A FEW TIMES AT BLOOMBERG. NATALIE MORRISON IS THE FOUNDER OF ASTORIA LONDON. SHE WILL JOIN US BACK AND OUR STUDIO TO TALK ABOUT WHAT IS GOING ON. THEY HAVE BEEN GROWING, OPENING STORES. SARAH JESSICA PARKER HAS A LINE COMING OUT UNDER THE BRAND. SHE IS DRIVING A LOT IN TERMS OF THE CREATIVE AT THE COMPANY. SHE WILL BE JOINING US IN STUDIO. IT IS A MONDAY. WE HAVE A LITTLE BUT OF THIS, LITTLE BIT OF THAT. NORAH: EVERYTHING. CAROL: WE HAVE TO GET A CHECK ON THE TRADE. THE S&P HIGHER. OVER TO AMY MORRIS, IN FOR CHARLIE PELLETT. AMY: PRESIDENT TRUMP TO UNVEIL A PLAN TO EASE RESTRICTIONS AROUND THE USE OF RENT DYED DIESEL. THAT IS FREE OF MOST FEDERAL FUEL TAXES BUT IS RESTRICTED TO OFF-ROAD ALLOCATIONS LIKE FARM EQUIPMENT, CONSTRUCTION, AND HEATING OIL. THE TRUMP ADMINISTRATION IS PREPARING TO EASE THE LIMITS THAT RESTRICT THE USE OF THAT TYPE OF DIESEL. THE AVERAGE COST OF DIESEL RIGHT NOW, ABOUT $6.32 PER GALLON. CRUDE OIL MOVING LOWER OBSESSION LOWS. WTI LESS THAN $90 A BARREL BUT BRENT CRUDE CREEPING BACK UP NEAR $101 A BARREL. WE CHECKED MARKETS FOR YOU ALL DAY LONG AT BLOOMBERG. S&P 500 IS UP 0.7%. NASDAQ NEARLY 1% HIGHER. THE DOW UP 310 7%. THE NASDAQ UP 0.7%. THE TREASURY YIELD AT 5.3%. THE 30 YEAR TREASURY YIELD AT 5.69%. THE SERVICE SECTOR IN THE U.S. EXPANDED AT A SLOWER PACE IN SEPTEMBER. COST PRESSURES GROWING BY THE MOST IN FOUR YEARS. ONE INSTITUTE'S INDEX FELL A HALF POINT. RESILIENT CONSUMER SPENDING, STRONG BUSINESS INVESTMENT, ALL OF THAT CONTINUES TO SUPPORT DEMAND FOR SERVICES BUT FIRMS ARE DEALING WITH MOUNTING COSTS. ISM'S MERGER OF PRICE ROSE TO 74, THE HIGHEST SINCE JULY OF 2022. THE MEASURE HAD HAD A NEARLY ONE YEAR LOW IN FEBRUARY BEFORE THE IRAN WAR SENT FUEL COSTS HIGHER. FOR ON-DEMAND NEWS 24 HOURS A DAY, SUBSCRIBE TO BLOOMBERG NEWS NOW WHEREVER YOU GET YOUR PODCAST. THAT IS A BLOOMBERG BUSINESS FLASH. LET'S RETURN TO "BLOOMBERG BUSINESSWEEK DAILY" WITH CAROL MASSAR AND NORAH MULINDA. CAROL: GOOD STUFF. THANK YOU. U.S. STOCKS TRADING NEAR ALL-TIME HIGHS DESPITE GEOPOLITICAL RISKS, CONCERNS ABOUT ELEVATED OIL PRICES AND BOND YIELDS. EUROPE IS SOMETHING WE HAVE BEEN TALKING ABOUT A LOT TODAY. THE EURO TO ITS WEAKEST LEVEL SINCE 2025. IT HAS BOOSTED THE DOLLAR'S HAVEN APPEAL BUT U.S. RATES GO UP AND THE DOLLAR USUALLY ALSO STRENGTHENS. NORAH: ABSOLUTELY. WE ARE LOOKING AT THE BROADER SCOPE RIGHT NOW. I THINK WHEN LOOKING AT RATES, WE SEE THE BENCHMARK 10 YEAR AT 5.34% TO STILL ELEVATED ABOVE THE KEY 5% KEEPING AN EYE ON. CAROL: NOT 6%. LET'S SEE WHAT OUR OWN MICHAEL BALL HAS TO SAY. HE JOINS US IN STUDIO. FIRST OF ALL, GOOD AFTERNOON. MICHAEL: THANKS FOR HAVING ME. CAROL: IT IS GOOD TO HAVE YOU. IT FEELS LIKE A LITTLE BIT OF A WEIRD DAY. WE ARE FOCUSING ON FRANCE AND OVERSEAS. IT ALSO SEEMS LIKE A DAY WERE ALL OF A SUDDEN AMERICAN EXCEPTIONALISM IS BACK IN VOGUE. TELL US ABOUT THE TRADE. MICHAEL: WE SAW A LITTLE BIT OF RELIEF IN SPREADS, A CONTINUATION FROM FRIDAY. THE DATA WAS OK. YOU GUYS COVER IT. IT WAS NOT OVERLY STRONG. IT CONFIRMS THE S&P PMI WHICH WAS STRONGER. WE HAD THE REVISIONS THERE. YOU SEE TECH LEADERSHIP. YOU HAVE HAD MOST OF THE SECTORS IN THE GREEN. NOT THE KIND OF STORY WHERE WE HAD COMMUNICATIONS AND TECH BEING CHARGED AND EVERYONE ELSE SUFFERING. SOME RELIEF BUT THERE IS NO REAL SOLUTION TO THESE PROBLEMS. TALKING TO TRADERS TODAY, DO WE HAVE TO WORRY ABOUT THE PHYSICAL STUFF AGAIN BECAUSE IT WAS NOT DRIVING YIELDS HIGHER. THAT WOULD SEEM SURPRISING BECAUSE YOU SEE AN ESCALATION WITH THE SAUDIS AND HOUTHIS OVER THE WEEKEND, BUT HERE WE GO. CAROL: THERE ARE DAYS WHERE THE MARKETS SHRUG OFF THE SAME STUFF WE TALKED ABOUT EVERYDAY, BUT THERE ARE DATES WERE RECEIVED REACTION. NORAH: CRAZY VOLATILITY. WE ARE SEEING MAJOR INDEXES IN THE MARKET WITH DOUBLE-DIGIT GAINS, BUT I AM CURIOUS. WE ARE TALKING ABOUT THE NEWS HAPPENING TODAY AND TYPICALLY YOU MIGHT EXPECT MONEY WOULD BE POURING INTO TREASURIES WHICH WOULD ULTIMATELY PUSH YIELDS LOWER, BUT WE ARE SEEING THEM ELEVATED, TALKING ABOUT THE 10 YEAR ABOVE 5%. TELL ME, WHY ARE TREASURIES NOT GETTING MORE OF A HAVEN BID? MICHAEL: THE CURVE STEEPENING SINCE WE GOT THE S&P PMI SO A LOT OF THAT HAS COME INTO THE FRONT END. PEOPLE ARE HIDING OUT THERE. THERE IS TOO MUCH WISHY-WASHY -NESS THERE. YOU WORRY ABOUT THE FISCAL MALFEASANCE, WHICH IS A GLOBAL STORY, OR THE GENERATION OF THE CURVE IS NOT THERE. PEOPLE FEEL WHAT IS HIDING OUT IN THE HYPERSCALERS AND SEMIS BECAUSE OF THE WAY THE FACTOR IS PERFORMING RIGHT NOW. PEOPLE ARE FINDING SOME TROUBLE. WE ARE NOW STARTING TO PRICE IN THE MIDTERM. WE LOOK 30 DAYS AHEAD AND ARE STARTING TO THINK ABOUT IT. WE THINK THE FED WILL NOT GO IN OCTOBER SO YOU HAVE MACRO NARRATIVES SHIFTING NOTABLY. NORAH: THAT IS FAIR. CAROL: WHAT ABOUT THE NEWS OUT OF FRANCE? WE ARE WATCHING GLOBAL ELECTIONS. WHAT IS IT WE AS U.S. INVESTORS NEED TO KEEP IN MIND, OR IS IT A CASE OF BAD NEWS OVERSEAS MEANS GOOD NEWS FOR THE UNITED STATES? IT IS INTERESTING AS WE GET READY FOR ANOTHER EARNINGS SEASON. DOES THE EARNINGS MOMENTUM CONTINUE, SLOW DOWN A BIT BUT STILL CONTINUE? MICHAEL: SPECIFIC TO FRANCE, THEY ARE IN A TOUGH SITUATION AND PUTTING THE ECB IN A TOUGH POSITION. THE POLITICAL BIFURCATION, BOTH FAR LEFT AND FAR RIGHT, HAS MADE IT HARD FOR ANYONE TO BELIEVE THERE CAN BE A COALITION OR REAL SOLUTIONS TO THE DEFICIT PROBLEM. NOT ABLE TO GROW OURSELVES OUT OF IT THAT EASILY. IF SOMEONE COMES OUT AND STARTS TO DO WHAT WE ARE SEEING IN THE U.K. AND GIVES SOLUTIONS THAT ARE CREDIBLE, WE HAVE SEEN A SUBSEQUENT REVERSAL AND THEY HAVE GOTTEN MORE FISCAL FORGIVENESS. THE POUND HAS BEEN OUTPERFORMING. ALL OF THIS AT THE EXPENSE OF THE EURO. JUST TO SWITCH BACK TO THE SECOND PART, EARNINGS ARE NEEDED BECAUSE THIS IS SUCH A CONCENTRATED MARKET. EARNINGS GROWTH IS ONLY IN A FEW NAMES AT THE S&P LEVEL. WHAT WE GOT IN Q2, ALL OF A SUDDEN THERE WAS AN EXPLOSION IN EARNINGS GUIDANCE AND THE ECONOMY WAS HOLDING UP FINE. FINALLY SEEING IT ON THAT FRONT AS WELL. CAROL: GOT TO LEAVE IT THERE. THANK YOU SO MUCH. THAT IS YOUR MARKET SET UP ON THIS MONDAY. WE WILL WHITTLE IT DOWN TO A SECTOR THAT IS INTEREST-RATE SENSITIVE. THIS IS AS WE TALKED ABOUT WHAT HAS BEEN GOING ON IN THE TREASURY MARKET. WE ARE ABOVE 5%. WE HAVE A GREAT GUEST, ONE OF THE BIGGEST IN THE WORLD. NORAH: THIS IS A MASSIVE COMPANY FOCUSED ON RETAIL. THIS IS A REALTY INCOME CORP. WE ARE JOINED TODAY BY THE CEO. HE IS JOINING US ON ZOOM OUT OF SAN DIEGO. THANK YOU FOR JOINING US. WE HAVE BEEN TALKING ABOUT THIS RATE ENVIRONMENT WHEN IT COMES TO THE BOND MARKET. JUST BROADLY SEEING THE BENCHMARK 10 YEAR STILL ELEVATED ABOVE 5%, CURRENTLY AT 5.3%. TALK TO US ABOUT HOW YOU ARE THINKING ABOUT THIS IN YOUR BUSINESS. SUMIT: YEAH, THANKS FOR HAVING ME. IT IS OBVIOUSLY SOMETHING WE ARE KEEPING A VERY CLOSE EYE ON. THE 10 YEAR TODAY HOVERING AROUND THE 5.3%. WHAT WE HISTORICALLY NOTICED IS WHAT YOU HAVE EXPECTATIONS OF 10 YEAR, NOT WHAT THE CURRENT RATE IS, BUT ONCE THAT EXPECTATION OF WHERE THE 10-YEAR ARE TO BE SETTLE IN THE ENVIRONMENT IN OUR BUSINESS STARTS TO ADJUST TO REFLECT WHAT THE NEW COST OF CAPITAL ENVIRONMENT IS GOING TO BE. FOR US, WE ARE OFTENTIMES VIEWED AS A PROXY GIVEN THE LONG DURATION OF LEASES, ETC. RATES AT LARGE COMMERCIAL REAL ESTATE AT LARGE TENDS TO BE RATE SENSITIVE. THAT TENDS TO BE THE MOST SENSITIVE TO WHAT HAPPENS TO THE RATE ENVIRONMENT. I THINK THIS IS WHERE REALTY INCOME STANDS OUT BECAUSE WE OBVIOUSLY CREATED MULTIPLE CHANNELS WHERE WE HAVE THE ABILITY TO INVEST IN EUROPE, THE ABILITY TO INVEST IN OTHER MARKETS LIKE MEXICO AND THE U.K. THEREFORE, ABLE TO TAKE ADVANTAGE OF WHERE WE HAVE BEST RISK-ADJUSTED RETURNS. DESPITE WHAT IS HAPPENING IN THE U.S., THERE ARE MULTIPLE CHANNELS FOR US TO LEAN ON AND CONTINUE TO GROW OUR BUSINESS. CAROL: BEFORE WE TALK ABOUT WHAT IS GOING ON IN THE U.S., YOU MENTIONED MULTIPLE MARKETS, SO WHAT IS THE MOST OPPORTUNISTIC RIGHT NOW? IS IT NOT U.S., EUROPE, MEXICO, THE U.K., OR ELSEWHERE? SUMIT: YEAH, IF YOU SEE WHAT WE DID, LAST YEAR WE HAD A SIMILAR SITUATION WHERE THERE WASN'T ONE OF VOLATILITY IN THE REGION ENVIRONMENT WHICH STARTED TO HAVE AN IMPACT ON OUR COST OF EQUITY. WE PIVOTED TO DO WITH A LOT MORE INVESTMENTS IN EUROPE. EUROPE ACCOUNTED FOR ABOUT 54% OF THE INVESTMENTS WE MADE IN 2025. SO ON THE EQUITY SIDE, ON THE MONETIZATION OF REAL ESTATE SIDE , WE ARE WILLING TO GO AND PURSUE TRANSACTIONS WHERE WE FIND THE BEST RISK-ADJUSTED RETURNS. BUT A HIGHER RATE ENVIRONMENT ALSO ALLOWS US TO LEAN INTO ONE OF THE AVENUES WE CREATED FOR OURSELVES WHICH IS ON THE CREDIT SIDE OF THE EQUATION. SO WE FIND VERY INTERESTING CREDIT OPPORTUNITIES IN THE U.S. WORKING WITH OUR PARTNERS, TRYING TO LEND OUR BALANCE SHEET, AND BASICALLY TAKE ADVANTAGE OF WHAT WE SEE ON THE HIGHER RATE SIDE BY LENDING TO OUR CLIENTS AT VERY GOOD RISK ADJUSTMENT RATES OVERALL. WE CAN PLAY EITHER ON THE EQUITY SIDE OR THE CREDIT SIDE. CAROL: SO YOU WILL NOT PICK A MARKET? YOU WILL NOT PICK A FAVORITE MARKET RIGHT NOW? SUMIT: [LAUGHTER] WELL, LOOK, I WAS LISTENING TO YOUR PREVIOUS GUEST. THE 10 YEAR BOND RATE IS 160 BASIS POINTS INSIDE OF THE U.S. PURELY ON THE EQUITY SIDE, THAT IS WHERE WE ARE SEEING A LOT OF OPPORTUNITIES. NORAH: WHAT IS ALSO INTERESTING ABOUT YOUR BUSINESS IS IT IS LARGELY FOCUSED AND RETAIL SO THAT GIVES YOU A FANTASTIC READ ON THE CONSUMER. WHAT ARE YOUR TENANTS TELLING YOU ABOUT THE HEALTH OF THE CONSUMER? SUMIT: THIS K-SHAPED ECONOMY IS REAL. WE HAVE SEEN A LOT OF THE BUSINESSES WE ARE EXPOSED TO, THE QUICK SERVICE RESTAURANT, THE DISCOUNT STORES, THE GROCERY BUSINESS. THOSE ARE THE BUSINESSES THAT TEND TO DO WELL WHEN YOU HAVE THIS K-SHAPED RECOVERY. AND WE SEE THAT IN TERMS OF THE EARNINGS GUIDANCE, IN TERMS OF PERFORMANCE OF SOME OF OUR CLIENT TO HAPPENED TO BE IN THESE SUBSECTORS. CASUAL DINING TENDS TO SUFFER. YOU ARE NOT TALKING ABOUT THE HIGHEST AND OF CASUAL DINING. THE K-SHAPED RECOVERY IS REAL AND THEY CONTINUE TO DO WELL, BUT SOME OF THE MORE NATIONAL NAMES YOU WOULD EXPECT TO FEEL THE BRUNT OF THIS K-SHAPED RECOVERY. YOU START TO NOTICE THAT. WE ARE SEEING THAT IN OUR PORTFOLIO OF NAMES WE ARE EXPOSED TO. IT ISN'T REAL ISSUE. THANKFULLY, THE WE RECONSTRUCTED OUR PORTFOLIO IS VERY DEFENSIVE IN NATURE. ESSENTIAL RETAIL, WHEN THEY TEND TO DO WELL AT TIMES OF ECONOMIC UNCERTAINTY. NORAH: SPEAKING OF ESSENTIAL RETAIL, YOUR PORTFOLIO IS EXPOSED TO GROCERY STORES, CONVENIENCE STORES, HOME-IMPROVEMENT DOLLAR STORES -- HOME-IMPROVEMENT, DOLLAR STORES. ARE THERE PART TWO ARE MORE CAUTIOUS ABOUT RIGHT NOW? SUMIT: ANYTHING TO DO WITH DISCRETIONARY RETAIL. WHEN YOU TALK ABOUT HIGHER END ITEMS, THEY TEND TO SUFFER AT TIMES LIKE THIS. WE HAVE BEEN VERY DELIBERATE ABOUT HOW WE CONSTRUCTED OUR PORTFOLIO. ONE OF THE THINGS WE TRIED TO STAY AWAY FROM HIS APPAREL AND FASHION AND AREAS THAT TEND TO SUFFER AT TIMES OF ECONOMIC DISTRESS, SO YOU WILL NOT FIND A LOT OF THAT. IF YOU LOOK AT THE PORTFOLIO TODAY, IT IS ABOUT 90% IN AREAS OF NO PRICE POINT SERVICE ORIENTED BUSINESSES AND KNOWN DISCRETIONARY RETAIL. THAT IS THE PROFILE OF THE BUSINESS WE ARE EXPOSED TO. CAROL: IF YOU ARE CREATING A COMPANY TODAY AND YOU COULD PUT AS MUCH MONEY AS YOU WANTED ANYWHERE, WOULD YOU STILL DO RETAIL OR WOULD YOU MUCH RATHER -- ON DATA CENTERS? YOU HAVE A -- OR WOULD YOU MUCH RATHER DOUBLE DOWN ON DATA CENTERS? SUMIT: THAT IS A GOOD QUESTION. I THINK WHAT HAS DEFINED US, OUR ABILITY TO CONTINUOUSLY REDEFINE WHO WE ARE AS A BUSINESS. WHAT IS SACROSANCT TO US IS OUR ABILITY TO CONTINUE TO GROW OUR DIVIDENDS, WHICH WE HAVE DONE FOR OVER 30 YEARS TODAY. QUARTER IN AND QUARTER OUT. OUR ABILITY TO LOOK FOR PATTERNS AND LOOK FOR TRENDS THAT WE BELIEVE WILL HELP US CONTINUE TO BE THE BUSINESS THAT PEOPLE ASSOCIATE WITH REALTY INCOME IS PARAMOUNT TO OUR SUCCESS. WHAT WE SAW ON THE DATA CENTER SIDE IS A WHAT ARE THE GENERATION TYPE OF ENVIRONMENT WHERE THERE IS SO MUCH FOCUS ON BUILDING OUT THE INFRASTRUCTURE REQUIRED FOR THE DIGITIZATION OF EVERYTHING WE ARE DOING FROM AI TO CLOUD COMPUTING TO STREAMING, ETC., TO SELF DRIVING CARS. YOU ARE GOING TO NEED THIS INFRASTRUCTURE. WE BELIEVE THAT THE BUILDOUT OF THIS PARTICULAR INFRASTRUCTURE LENDS ITSELF TO THE SINGLE TENANT FREESTANDING BUILDINGS. THAT HAS BEEN THE THESIS WE ARE LEANING INTO TO TRY TO CONTINUE TO DRAW THAT PIECE OF OUR BUSINESS. TODAY, A SMALL PORTION OF OUR BUSINESS, BUT THE HOPE IS IT WILL BE A MUCH BIGGER PORTION. BY DEFINITION, WE ARE CERTAINLY GOING TO BE LEANING INTO THIS PARTICULAR AREA OF THE OPPORTUNITY SET WE HAVE AVAILABLE TO US, AND WE HOPE THIS WILL BECOME BIGGER. HAVING SAID ALL OF THAT -- CAROL: GO AHEAD. FINISH, PLEASE. SUMIT: WE WILL NOT INVEST IN EVERY DATA CENTER OPPORTUNITY OUT THERE. WE ARE HYPER-SELECTIVE IN TERMS OF WHERE WE WANT TO INVEST IN THE DATA CENTER SPACE. LOCATION IS IMPORTANT. THE PARTNER WHO WE ARE PARTNERING WITH ON THE DEVELOPER SIDE IS IMPORTANT. THE TYPE OF LEASES IS VERY IMPORTANT. IS THE COUNTERPARTY?WHO IS THE CLIENT WE WILL BE EXPOSED FOR 15, 20 YEARS? THAT IS IMPORTANT, AND ALL OF IT WILL COME TO THE FLOOR WHEN WE MAKE A DECISION ABOUT WHO WE WANT TO PARTNER WITH. CAROL: SO IF YOU HAD TO PICK A PERCENTAGE OF HOW MUCH DATA CENTER, JUST QUICKLY, WOULD IT BE 30%? WE ARE BLOOMBERG. WE WILL HOLD YOU TO IT. SUMIT: I WISH I COULD, BUT I WOULD JUST ANSWER IT THIS WAY. THERE ARE TRILLIONS OF DOLLARS THAT WILL NEED TO BE INVESTED IN THIS SPACE. WE BELIEVE GIVEN THE PROFILE OF THE BUSINESS WE HAVE WE NEED TO BE PART OF THAT SOLUTION SO IT WILL BE A MUCH BIGGER PORTION OF OUR PORTFOLIO. CAROL: WE WILL CONTINUE THIS CONVERSATION. HE IS THE PRESIDENT AND CEO OF REALTY. COMING UP, NATALIE MORRISON AND SARAH JESSICA PARKER. WE WILL TALK DIAMONDS GROWN IN THE LAB. THAT IS COMING UP NEXT. AMY: IT IS 2:21 P.M. ON WALL STREET. PRESIDENT TRUMP READY TO UNVEIL A PLAN TO EASE RESTRICTIONS AROUND THE USE OF RED DYED DIESEL, FREE OF MOST FEDERAL FUEL TAXES, RESTRICTED TO OFF-ROAD APPLICATIONS FROM MAKE WOMEN, CONSTRUCTION, AND HEATING OIL. THE TRUMP ADMINISTRATION PREPARING TO EASE LIMITS ON THE USE OF THAT DIESEL. THE LATEST AVERAGE COST OF DIESEL IS $6.32 PER GALLON. CRUDE OIL IS MOVING LOWER. WTI LESS THAN $90 A BARREL. BRENT CRUDE NEARING ONE DOLLARS A BARREL. A RALLY IN GIANT TECH COMPANIES DROVE STOCKS HIGHER. NASDAQ UP 1%. THE DOW -- MICROSOFT SHARES ARE 1.5% HIGHER, TOUCHING AN 11 MONTH INTRADAY HIGH AFTER THE STOCK WAS GREETED TO BUY, SAME WORRIES ABOUT AI SAFETY RISKS ARE DRIVING ENTERPRISES TO MICROSOFT AS THE TRUSTED ADULT IN CHARGE. ANALYSTS ANTICIPATE HAPPIER AI SPENDING IN FISCAL 2027 AND HAVE A CONTINUED -- AND CONTINUE TO EMPHASIZE MICROSOFT CAPACITY. FOR ON-DEMAND NEWS 24 HOURS A DAY, SUBSCRIBE TO BLOOMBERG NEWS NOW WHERE EVERYTHING YOUR PODCAST. THAT IS YOUR BLOOMBERG BUSINESS FLASH. LET'S GO BACK TO "BLOOMBERG BUSINESSWEEK DAILY" WITH CAROL MASSAR AND NORAH MULINDA. CAROL: WE TALK ABOUT DIAMONDS A LOT. I TALK ABOUT DIAMONDS A LOT. WE TALK ABOUT LUXURY. WE TALK ABOUT JEWELRY. WE TALK ABOUT WATCHES. ON DIAMONDS, ONE OF THE THINGS WE POINTED OUT A LOT IS HOW THE MARKET HAS DRASTICALLY CHANGED. YES, A DIAMOND MAY STILL BE FOREVER BUT IT MAY INCREASINGLY BE GROWN IN THE LAB. THIS MARKET CONTINUES TO GROW, SO WE ARE DELIGHTED TO HAVE BACK WITH US THE FOUNDER OF ASTOR YOUR LONDON -- ASTRIA LONDON, AND SHE BROUGHT WITH HER A GREAT PART OF THE TEAM, SARAH JESSICA PARKER. VERY WELL-KNOWN KNOWN TO THE BLOOMBERG AUDIENCE. WELCOME. NICE TO HAVE YOU HERE. >> THANKS FOR HAVING US. CAROL: WE WANT TO TALK ABOUT THE STUFF YOU ARE DOING TOGETHER BUT I AM CURIOUS HOW YOU GUYS CAME TOGETHER BECAUSE I AM SURE YOU GET PITCHED A LOT OF THINGS. YOU GET PITCHED A LOT OF THINGS. HOW IS IT THIS MADE SENSE? >> WE DON'T HAVE TIME TO TELL EACH OF OUR OWN VERSION BUT I AM SURE THEY WOULD BE ALIGNED ANYWAY. JUST CURIOUS. I GOT A CALL FROM MY AGENT SAYING THIS YOUNG WOMAN HAD REACHED OUT AND HAD STARTED THIS BUSINESS ALTHOUGH IT WAS NOT A BRAND-NEW NEWBORN AND SHE WANTED TO HAVE A CONVERSATION ABOUT AND IT WAS SPECIFIC AROUND LAB GROWN DIAMONDS AND WHAT SHE HOPED TO DO WITH THE COMPANY AND HOW SHE WANTED TO GROW IT IN A PARTNERSHIP WE MAY OR MAY NOT BE ABLE TO SORT OUT. I WAS REALLY INTRIGUED AND DISCOVERED HOW LITTLE I REALLY KNEW ABOUT LAB GROWN DIAMONDS. MOST OF WHAT I KNEW WAS GENERALLY WHAT IS HAPPENING IN THIS COUNTRY AND THE PRICE POINT AT FOUND IT SUCCESS. THAT IS HOW LIMITED I WAS. THE PERSON THAT RUNS THE MASTER CLASS. CAROL: LET'S TALK ABOUT THE ACCEPTANCE OF LAB GROWN DIAMONDS BECAUSE I REMEMBER DOING STORIES AND THERE WERE LIMITATIONS, COSTS INVOLVED IN TERMS OF THE CREATION, BUT HOW HAS IT EVOLVED? WHAT I TALK TO MOST PEOPLE WHO GET ENGAGED TODAY, IT IS A LAB GROWN DIAMOND. >> 60% OF THE ENGAGEMENT DIAMONDS ARE LAB GROWN DIAMONDS. IT IS A $100 BILLION MARKET A YEAR. 1% OF THE MARKET IN 2015, 5% IN 2021, ALMOST 30% LAST YEAR, ALTHOUGH WE DON'T KNOW THE EXACT NUMBER. I DON'T KNOW IF YOU HEARD, BUT IT WILL BE 100% BY 2030. >> NATHALIE ALWAYS MOVES THOSE PREDICTIONS CLOSER TO WHERE WE ARE AND SHE IS ALWAYS RIGHT. NATHALIE: BY 2030, 75% GOOD I WILL MAKE A BET ON 90%. NORAH: I WANT TO KNOW WHAT SPECIFIC ASPECT OF THIS PROJECT RESONATED WITH YOU? YES, I NEED TO BE IN ON THIS. SARAH: I THINK THE CREATIVE PART IS ALWAYS COMPELLING TO ME, BUT THAT WITHOUT THE KIND OF, THAT IS NECESSARY AS I DISCOVERED OVER THE MANY YEARS BEING A CREATIVE PERSON. YOU DON'T GET FAR, IT DOES NOT MATTER HOW BIG YOU DREAM, BUT THERE IS ALSO THIS TECHNOLOGY THAT SHE WAS PARTICULARLY EXCITED ABOUT. SHE WAS EXTREMELY EXCITED ABOUT THE CREATIVE AND WHAT COULD BE DONE AND WHAT SHE WANTED TO DO AND WHAT SHE HOPED WE COULD DO WITH THIS OTHER COLLECTION. BUT THE TECHNOLOGY WAS A PHENOMENON TO ME. THE FACT THAT WE CAN HAVE SO MUCH FLEXIBILITY BY THAT YOU CAN ASK SO MUCH OF IT, THE QUALITY AND CUT AND CLARITY AND THE KIND OF ELEGANCE AND BEAUTY AND LUXURY THAT DID NOT EXIST YET IN THE LAB GROWN DIAMOND BUSINESS WAS PRETTY EXCITING TO TRY TO BE WORTHY OF. YOU KNOW? THUS FAR, SHE HAS BEEN RIGHT. CAROL: WE WANT TO TALK ABOUT YOUR CONNECTION BECAUSE IT IS VERY UNIQUE, BUT LET'S GO TO THE TECHNOLOGY. THERE WERE LIMITATIONS IN THE SIZE. LOTS OF LIMITATIONS SO THERE WERE QUESTIONS ABOUT WHETHER OR NOT THIS COULD BECOME SOMETHING. TELL US ABOUT THE TECHNOLOGY OR WHAT WE NEED TO UNDERSTAND TO THE AUDIENCE ABOUT WHAT HAS CHANGED. NATHALIE: I THINK WHAT HAS CHANGED THIS WITH TECHNOLOGY GROWING ALL THE TIME, THERE IS NOTHING WE CAN'T DO RIGHT NOW SO PEOPLE DREAM BIG. CAROL: SPEAKING OF BIG -- NO. NATHALIE: THIS IS THE FIRST DIAMOND NECKLACE IN THE WORLD, 174 CARROTS, 1% OF THE DIAMONDS IN THE ROAD. SO THERE IS NOTHING WE CANNOT ACHIEVE. COLORS, CLARITY. FLEXIBILITY. SARAH: THIS IS A RING ON A TORQUE SO IT ACTUALLY SPINS. WE ALSO HAVE ALL THE NEW CONNECTION HAS NECKLACES AND BRACELETS AND CUFFS. THAT IS JUST PART OF THE TECHNOLOGY OF GREAT ENGINEERS AND JEWELRY DESIGNERS THAT CAN GO HAND IN GLOVE WITH THE TECHNOLOGY THAT GOES INSIDE LAB GROWN DIAMONDS. NATHALIE: WE ARE TALKING ABOUT A DIFFERENT ERA IN THE JEWELRY. IT IS NOT JUST ABOUT USING THE TECHNOLOGY. IT IS ALSO CREATING A HOUSE ON THE FUTURE FOCUSED ON SUSTAINABILITY, CRAFT MIDSHIP, DESIGN. WHEN YOU MIX ALL OF THIS, WE HAVE TO DO A GOOD JOB. NORAH: TALK TO BE ABOUT HOW DIFFICULT THIS IS TO PULL OFF, BEING THE EXPENSES, THE CAPITAL NEEDED. HOW DIFFICULT IS IT WHEN IT COMES TO THE TECHNOLOGY TO MAKE THINGS AS BEAUTIFUL AS WHAT YOU ARE WEARING? NATHALIE: IT IS MUCH MORE EXPENSIVE THAN PEOPLE THINK. IT IS GETTING CHEAPER WITH THE ECONOMY OF SCALE BECAUSE THE LAB GROWN DIAMOND WAS DISCOVERED IN 1950 ORIGINALLY. BUT NOW IT HAS BECOME ONLY REALLY FAMOUS SINCE 2018 WHEN THE FTC IN THE U.S. DECLARED A DIAMOND IS A DIAMOND, WEATHER FROM A LAB OR A MINE -- WHETHER FROM A LAB OR A MINE. THE TECHNOLOGY IS VERY EXPENSIVE. YOU NEED A LOT OF PHD. IT IS GETTING CHEAPER AND CHEAPER. NORAH: THE MORE YOU PRODUCE. NATHALIE: THE MORE WE PRODUCE. CAROL: TALK TO US ABOUT YOUR CONNECTION WHICH LAUNCHED THIS MONTH BECAUSE IT HAS A REAL VINTAGE FEEL TO IT. YOU TALKED ABOUT IT. THEY ARE FUN AND MOVE AROUND. SARAH: THEY ARE FUN BUT HOPEFULLY NOT SILLY. SO MUCH OF WHAT I LOVE AND HAVE WORN IS REALLY FROM THRIFT SHOPS, CONSIGNMENT SHOPS, VINTAGE SPOTS, AND IT IS OLD. IT IS COLORFUL. IT IS OFTEN BIGGER IN SCALE. IT HAS A LITTLE BODY TO IT. AT THE SAME TIME, IT IS NOT AS FEMININE AS WHAT PEOPLE TYPICALLY CONSIDER JEWELRY FOR WOMEN. SOME INSIGHT AS THIS EXTRAORDINARY COLLECTION THAT ALREADY EXISTS. I SAY IT IS ULTRA FEMININE. IT IS FOR A LADY. IS THIS OTHER CONSUMER, THIS OTHER SHOPPER THAT MIGHT WANT A TOUCH MORE MUSCLE AND A TOUCH MORE -- I THINK OF A METROPOLITAN APPROACH TO IT, BUT IT IS NOT, AND IT IS FOR EVERYBODY. IT JUST HAS A LITTLE BIT MORE KIND OF -- IT IS A FULLER FIGURE. I DON'T KNOW. THIS IS ONE OF THEM, BUT WHEN I PULL THE PIECE, THERE ARE SO MANY. THIS IS PART OF THE NEW CONNECTION. WE HAVE THESE PENDANTS. IT IS JUST THE TINIEST CORNER OF A PORTRAIT. IT IS JUST REALLY BASED ON COLOR AND A KIND OF SHAPE AND SILHOUETTE THAT MIGHT BE RECOGNIZED BUT FEELS THAT'S RECOGNIZED FOR THE PAST BUT FEELS CONTEMPORARY AND IS FULL OF COLOR. CAROL: INHIBITING OLDER JEWELRY, I FEEL THE SAME WAY. I GO TO CONSIGNMENT SHOPS OR A GARAGE SALE AND YOU HAVE AN OLD RHINESTONE NECKLACE. SARAH: YES, YES. CAROL: THE ARTWORK IS INCREDIBLE. SARAH: THE OLDER BEAUTIFUL RHINESTONE PASTE EARRINGS THAT HAD THESE GORGEOUS DEEP COLORS, SUPER CONCENTRATED COLORS, THEY CAN BE MADE REALLY SEXY AND CONTEMPORARY. WE HAVE SOME PIECES THAT JUST ARRIVED FOR THE FIRST TIME THAT RUN UP THE EAR. AND WE ARE WORKING WITH PEARLS AND DIAMONDS NOW. THEY ARE ALSO BECOMING INVOLVED. NATHALIE: NO LIMIT OF WHAT WE CAN DO. CAROL: THERE IS THE NEXT GENERATION. I DON'T KNOW HOW YOU FEEL ABOUT JEWELRY. NORAH: WHEN IT COMES TO LAB GROWN DIAMONDS, I AM SO IN DIFFERENT. PEOPLE ARE LIKE, THIS IS FAKE VERSUS REAL. SARAH: IT IS NOT FAKE. NATHALIE: IT IS NOT. NORAH: THAT IS WHAT A LOT OF PEOPLE ARE NOT EDUCATED ABOUT. NATHALIE: LIKE WHEN THE TOP OF THE ICEBERG BECOMES ICE, THE SAME AS THE WATER THAT YOU PUT IN THE FRIDGE THAT BECOMES ICE. A DELICATE WAY TO SAY THIS. I THINK THE MAIN QUESTION I WANT TO CORRECT IS ON THE RESALE VALUE. BECAUSE PEOPLE SAY LAB GROWN DIAMONDS DON'T HAVE A RESALE VALUE. MAYBE THEY ARE RIGHT. NOBODY KNOWS BECAUSE THERE IS NO SECONDARY MARKET. A DIAMOND IS NOT AN INVESTMENT. WE HAVE BEEN SAYING THAT, BUT IF YOU LOOK AT THE NUMBERS, THEY LOST 50% OF THE FIVE YEARS -- THEY LOST 50% OF THEIR VALUE OVER THE LAST FIVE YEARS. THE DIAMOND WILL COST YOU $6,000 TO $8,000. THE EQUIVALENT RING IN MY DIAMOND WILL COST YOU LESS. YOU CAN GET THREE TIMES THAT. THEY ARE BOTH INTERNAL AND BEAUTIFUL. SARAH: I DON'T LOOK AT IS THE COLLECTION ANYMORE AND THINK THESE ARE EXQUISITE LAB GROWN. I DON'T SEE IT ANYMORE. I SAW IT IN PERSON FINALLY AND THOUGHT, MY GOD, THOSE ARE BEAUTIFUL DIAMONDS. NORAH: DO YOU HAVE A FAVORITE? CAN YOU TELL US? SARAH: I NEVER HAVE FAVORITE PICTURES, BOOKS, CHILDREN, FOOD. I CANNOT PICK FAVORITES, BUT I AM REALLY EXCITED ABOUT ALL OF THEM. YEAH. CAROL: TELL US ABOUT WHAT IS GOING ON WITH MEN, BECAUSE WE , THAT OFTEN AND IT IS WITH WATCHES -- BECAUSE WE COVER THAT OFTEN AND IT IS WITH WATCHES. NATHALIE: OUR FIRST MEN'S COLLECTION. I AM TELLING YOU THE MEN ARE GOING TO WEAR MORE AND MORE DIAMONDS. IT IS GROWING EVERY YEAR. CAROL: GROWTH YEAR-OVER-YEAR? WHAT CAN YOU TELL US? NATHALIE: DOUBLING THIS YEAR ALREADY. CAROL: NEW YORK CITY NEXT YEAR? NATHALIE: NEW YORK CITY NEXT YEAR. CAROL: MORE COLLECTIONS TO COME? SARAH: YEAH. WE KEEP PURSUING. WE KEEP WORKING. ALWAYS, IT IS THE NEXT COLLECTION. IT IS THE WONDERFUL MONOTONY OF DESIGN THAT IT IS ALWAYS WAITING FOR YOU. CAROL: BUT YOU LIKE IT. NORAH: VERY MUCH -- SARAH: VERY MUCH. NORAH: YOU COULD TELL. NATHALIE: LOOKING AT LUXURY. CAROL: I HAVE BEEN LOOKING AT LUXURY, BOTH OF YOU. THANK YOU SO MUCH. FOLKS, WE ARE COMING BACK ON "BLOOMBERG BUSINESSWEEK DAILY." AMY: PRESIDENT TRUMP PREPARING TO EASE LIMITS RESTRICTING THE USE OF TAX EXEMPT VARIETY OF DIESEL TO PAIR COST FOR THE ESSENTIAL FUEL AHEAD OF THE MIDTERM ELECTIONS. IT IS NOT EXPECTED TO BOOST THE OVERALL SUPPLY OF DIESEL. THE AVERAGE PRICE OF DIESEL RIGHT NOW, $6.32 PER GALLON. CRUDE OIL MOVING LOWER. WTI ABOUT $89 A BARREL NOW AND BRENT CRUDE AT $100 A BARREL. WE CHECKED MARKETS FOR YOU ALL DAY LONG BY BLOOMBERG. THE S&P 500 UP THREE QUARTERS OF 1%. THE DOW IS UP ALMOST 0.3%. THE RUSSELL 2000 INDEX UP 0.7%. THE 10-YEAR TREASURY YIELD AT 5.33%. THE TWO YEAR YIELD AT FOUR POINT 85%, AND THE 30 YEAR TREASURY YIELD IS AT 5.68%. THE 30 YEAR YIELD ARE HEADING CLOSER TO 6% NOW. THAT'S A IS A SHAKEUP IN FUTURES USED BY INVESTORS FOR HEDGING GOVERNMENT BOND POSITIONS. A 30-YEAR-OLD -- A 30 YEAR YIELD RISE TO 6% COULD SEE A SHIFT TO A 2015 MATURITY. INVESTORS ARE ALREADY MAKING SOME ADJUSTMENTS. THE PHILADELPHIA SEMICONDUCTOR INDEX, 0.3% HIGHER LED BY NVIDIA, WHICH IS 2% HIGHER. A FORMER ANTHROPIC RESEARCHER TESTIFIED BEFORE THE NEW YORK CITY COUNCIL AS COUNCIL MEMBERS ARE LOOKING AT CURBS ON ARTIFICIAL INTELLIGENCE. HE WARNED THE INDUSTRY DOES NOT FULLY UNDERSTAND THE RISKS OF DEVELOPING AI AND TOOLS LIKE KILIS SWITCHES MAY BE HELPFUL IN THE SHORT TERM BUT ARE NOT LIKELY TO BE ENOUGH TO ENSURE SAFETY. FOR ON-DEMAND NEWS 24 HOURS A DAY, SUBSCRIBE TO BLOOMBERG NEWS NOW WHEREVER YOU GET YOUR PODCASTS. THAT IS A BLOOMBERG BUSINESS FLASH. LET'S GO BACK TO "BLOOMBERG BUSINESSWEEK DAILY." CAROL: ALL RIGHT, THANK YOU SO MUCH. THAT EX ANTHROPIC RESEARCHER TESTIFYING AT THE NEW YORK CITY COUNCIL HEARINGS IN DOWNTOWN NEW YORK, WE WILL CHECK IN WITH OUR REPORTER IN THE NEXT HOUR AND HAVE MORE ON THAT. MEANTIME, ONE OF THE OTHER THINGS GOING ON TODAY HAS TO DO WITH THE SUPREME COURT. KEEP IN MIND THAT GOVERNING IN DONALD TRUMP'S WASHINGTON LEAVES YOU WITH GET BEHIND HIM OR ABSORB HIS WRATH. THAT IS WHATEVER WASHINGTON EDITION NEWSLETTER POINTS OUT TODAY. LET'S SEE WHAT THAT MEANS FOR THE SUPREME COURT, WHICH OPENED A NEW TERM TODAY. FOLLOWING IT ALL AND REPORTING IT FOR US, HE HAS EVERYTHING THAT IS HAPPENING, THE BIG NEWS OF SUPREME COURT REPORTER, AND HE JOINS US IN OUR D.C. NEWSROOM. GOOD TO HAVE YOU WITH US. TALK TO US ABOUT WHAT IS TOP OF MIND AND WHAT IS ON THE DOCKET FOR THE SUPREME COURT. WHAT MIGHT BE CATCHING THE HEADLINES AS THESE DECISIONS COME IN THE FUTURE? >> YEAH, SO TOP OF MIND IS PROBABLY THE CASE THEY HEARD TODAY. THEY HEARD THE BIG CASE INVOLVING CLIMATE CHANGE AND WHETHER STATE AND LOCAL GOVERNMENTS CONSUME ENERGY COMPANIES, SAYING YOU ARE RESPONSIBLE FOR SOME OF THIS CLIMATE CHANGE AND WE NEED YOU TO PAY SOME OF THE COSTS WE ARE INCURRING. THE COURT HEARD ARGUMENTS IN THAT CASE TODAY. SOMEWHAT INCONCLUSIVE. IT WAS NOT A CLEAR OUTCOME. JUSTICE ALITO HAS RECUSED HIMSELF BECAUSE OF SOME STOCK HOLDINGS OF HIS WIFE MUST'VE IS A LITTLE HARD TO SEE HOW THAT WILL COME OUT, BUT SUPER IMPORTANT FOR THE ENERGY INDUSTRY AS WELL AS THE ENVIRONMENT. THERE ARE DOZENS OF OTHER SUITS OUT THERE LIKE IT. CAROL: IF IT HAD NOT BEEN -- IT IS INTERESTING. WE THINK ABOUT THE POLICIES WE CONTINUE TO SEE I FEEL LIKE ROLLED BACK BECAUSE OF THE CLIMATE. THE IMPLICATIONS OF THIS CAN BE SEVERE IF YOU WILL IN TERMS OF WHAT WE HAVE BEEN SEEING OVER THE LAST FEW DECADES WHEN IT COMES TO CLIMATE CHANGE. GREG: IF YOU ARE SOME THINGS THERE ARE TO BE MORE DONE TO COMBAT CLIMATE CHANGE, YOU HAVE HAD A BAD RUN IN THE U.S. OVER THE LAST FEW YEARS. THE ADMINISTRATION ROLLING BACK WITH THE EPA HAS DONE. YOU HAVE THE SUPREME COURT AND SEVERAL DECISIONS ON OTHER LEGAL QUESTIONS IN RECENT YEARS SAYING YOU CANNOT SUE UNDER FEDERAL LAW. THERE ARE CERTAIN THINGS THE EPA CANNOT DO, AND THIS IS THE SIGNIFICANT AVENUE IN THE COURTS THAT IS OUT THERE. SEVERAL DOZEN LAWSUITS WHERE THEY ARE SAYING WE EXPECT YOU TO PAY PART OF WHAT WE ARE PAYING TO COPE WITH CLIMATE CHANGE, AND THERE MIGHT BE MORE OF THESE LAWSUITS, AND THEY COULD BE A POTENTIAL SIGNIFICANT PROBLEM FOR THE INDUSTRY. CAROL: WHAT MIGHT ALSO COME DOWN THAT WE WILL BE WATCHING FOR THE NEXT FEW MONTHS? GREG: ANOTHER BIG CASE WILL BE SEMI AUTOMATIC ASSAULT WEAPONS. 11 STATES BAN THOSE. THE SUPREME COURT WILL HEAR ARGUMENTS. NOT SURPRISINGLY, THE CHALLENGE IS THE BANS VIOLATE THE CONSTITUTION. AS A SUPREME COURT FRIENDLY TO GUN RIGHTS. NEUROTIC COUPLE OF IMMIGRATION AND DEPORTATION CASES, INCLUDING WHAT LIMITS THERE ARE WHEN THE ADMINISTRATION WANTS TO SEND SOMEBODY TO A COUNTRY, TO DEPORT SOMEBODY TO A COUNTRY OTHER THAN THEIR OWN, HOW MUCH NOTICE THEY HAVE TO GIVE BEFORE THAT HAPPENS. CAROL: THIS HAS BEEN AN INTERESTING SUPREME COURT TO SAY THE LEAST. IS IT EASY TO SAY THEY WILL BE THINKING ABOUT THEIR DECISIONS IN TERMS OF WHO IS IN THE WHITE HOUSE? GREG: ABSOLUTELY. IT HAS BEEN A COURT FROM THE FRIENDLY -- A COURT PRETTY FRIENDLY TO PRESIDENTIAL POWER. WE SAW LIMITATIONS ON PRESIDENT TRUMP'S TARIFFS AND HIS EFFORT TO FIRE A FED GOVERNOR, BUT THAT IS THE DYNAMIC THAT IS ALWAYS THERE. WE DON'T HAVE ANY REAL DIRECT CASES INVOLVING PRESIDENTIAL POWER RIGHT NOW, BUT CERTAINLY YOU DO NOT HAVE TO LOOK FAR IN THE FUTURE TO THINK THERE MIGHT BE OTHER ONES COMING UP. WE COULD GET THE EFFORT TO FIRE LISA COOK BACK AT THE COURT. WE COULD GET BIRTHRIGHT CITIZENSHIP BACK AT THE COURT. DONALD TRUMP HANGS OVER EVERYTHING IN THIS TOWN, INCLUDING THE COURT'S DOCKET. CAROL: ONE OF THE THINGS I ALWAYS THINK ABOUT A LOT BECAUSE IT FEELS LIKE EVERY FEW WEEKS, EVERY FEW MONTHS THERE IS SOME KIND OF SHOOTING. THERE IS A DECISION OR ARGUMENTS HEARD OVER THE RIGHTS TO OWN SEMI AUTOMATIC WEAPONS. WHAT IS AT ISSUE HERE? GREG: SO THIS IS REALLY THE FIRST TIME THAT THE COURT HAS LOOKED AT WHAT SORTS OF WEAPONS ARE COVERED UNDER THE SECOND AMENDMENT. WE HAVE HAD OTHER CASES INVOLVING WHO IS PROTECTED BY THE SECOND AMENDMENT, WHERE IT APPLIES. FOR EXAMPLE, DOES IT APPLY IF YOU WANT TO CARRY A GUN IN PUBLIC? THIS IS THE FIRST TIME TO LOOK AT WHAT IS COVERED. THESE ARE WEAPONS THAT ARE VERY POPULAR, ESPECIALLY IN SOME PARTS OF THE COUNTRY. THAT IS ACTUALLY A SIGNIFICANT ARGUMENT THAT THE OPPONENTS OF BANS ARE MAKING. THEY ARE SAYING YOU CANNOT BAN SOMETHING IN COMMON USE. IT IS THE KIND OF THING THE SECOND AMENDMENT PROTECTS. IT IS A HUGELY IMPORTANT POLITICAL ISSUE. ONE OF THE CASES THE COURT IS CONSIDERING IS OUT OF CONNECTICUT ABOUT A BAN THAT WAS ENACTED AFTER THE HORRIFIC SCHOOL SHOOTING AT SANDY HOOK. IT HAS DRAWN A LOT OF EMOTIONS FROM PEOPLE ON BOTH SIDES. NORAH: ANOTHER THING WE ARE LOOKING AHEAD TOWARD IS THE MIDTERMS. I AM CURIOUS AS WE ARE WEEKS AWAY FROM MIDTERM ELECTIONS, HOW DO THESE END UP BEFORE THE COURT? GREG: WE HAVE HAD A LOT OF ELECTION DISPUTES SO FAR, THINGS LIKE REDISTRICTING AND MAIL-IN BALLOT RESTRICTIONS. RIGHT NOW, WE DON'T HAVE ANY OF THOSE CASES IN THE PIPELINE BEFORE THE ELECTION. IT SEEMS LIKE THE BIG ELECTION LITIGATION IS OVER WITH. HAVING SAID THAT, ESPECIALLY IF WE END UP IN A CLOSE ELECTION WHERE THE CONTROL OF THE SENATE IS AT STAKE, WE COULD HAVE FIGHTS OVER CERTIFICATION OF WINNERS. YOU CAN IMAGINE CONTROVERSIES ARISING, AND THOSE ARE THE SORTS OF DISPUTES THAT CAN QUICKLY ESCALATE TO THE SUPREME COURT. THERE IS A CERTAIN AMOUNT OF BREATH HOLDING GOING ON ABOUT WHAT MIGHT HAPPEN IF THERE IS A CLOSE ELECTION. CAROL: YOU WONDER IN TERMS OF THE MIDTERMS AND THE ELECTIONS IF THEY ARE CLOSE AND HOW MANY GET DISPUTED. AT THE SAME TIME COMMITTEE ULTIMATE OUTCOME, I WONDER IF THAT WILL HAVE A LASTING IMPACT SHOULD IT BE A DEMOCRATIC WIN OR AT LEAST GRIDLOCK IN WASHINGTON. WILL THE SUPREME COURT JUSTICES TAKE NOTICE OF SOMETHING LIKE THAT? JUST QUICKLY. GREG: YEAH, THEY CERTAINLY TAKE NOTICE. IT WILL MATTER FOR THE CASES THEY GET AND POTENTIAL RETIREMENT DECISIONS. IF DEMOCRATS TAKE ONE OR BOTH HOUSES OF CONGRESS, WE WILL SEE INVESTIGATIONS AND THAT WILL BE IN SUBPOENAS AND THERE WILL BE QUESTIONS OF PRIVILEGE AND THE LIKE. THOSE ARE THE SORTS OF THINGS THAT WILL GET TO THE SUPREME COURT PERHAPS QUICKLY. SECONDLY, IF YOU THINK ABOUT A JUSTICE THAT MIGHT RETIRE TO GIVE PRESIDENT TRUMP A FOURTH SUPREME COURT APPOINTING, IF YOU HAVE A DEMOCRAT CONTROLLED SENATE, THE EXPEDITION IS THERE IS VERY LITTLE CHANCE DEMOCRATS WILL CONFIRM THAT. SO THEY MAY HOLD OFF UNTIL THE NEXT PRESIDENTIAL ELECTION. CAROL: IT MEANS YOU WILL BE REALLY BUSY. GREG STOHR, THANK YOU. A GREAT RUNDOWN OF WHAT WE SHOULD WATCH. WHEN WE COME BACK, STOCKS ON THE MOVE. THIS IS BLOOMBERG. ♪ >> THIS IS "BLOOMBERG BUSINESSWEEK DAILY" WITH CAROL MASSAR AND TIM STENOVEC ON BLOOMBERG RADIO AND TELEVISION. CAROL: GETTING CLOSE TO THE LAST HOUR OF TRADING ON THIS MONDAY, OCTOBER 5. CAROL MASSAR ALONG WITH NORAH MULINDA IN FOR TIM ON THIS MONDAY. LOOK AT THE S&P. DOES NOT LOOK LIKE WE HAVE HIT A RECORD. NOT HERE ON AN INTRADAY BASIS, BUT WE ARE GETTING NOT FAR FROM ITS WE ARE KEEPING AN EYE ON THE AVERAGE. IT IS DEFINITELY HIGHER AND SO IS THE NASDAQ 100. S&P 500, 350 NAMES ARE HIGHER IN THE INDEX ON THIS MONDAY. WE'VE GOT STOCKS OF, BONDS DOWN, YIELDS HIGHER, WHICH IS FASCINATING. SOME OF THE REPORTING WE HAVE BEEN DOING IS TALKING ABOUT THE U.S. AS A SAFE HAVEN TRADE. SOME OF US -- SOME OF IT IS GOING ON OVERSEAS, BUT THE U.S. HAS A FISCAL HOUSE THEY HAVE TO BE LOOKING AT, THAT WE HAVE TO BE LOOKING AT. NORAH: ABSOLUTELY, AND KEEPING OUR EYES ON ALL OF THAT AND WHAT IS GOING ON IN THE MIDDLE EAST AND THE IMPACT ON OIL. WE HAVE BEEN TALKING ABOUT THIS NONSTOP. SEEING BRENT CRUDE DROPPING BELOW THE $100 LEVEL, CURRENTLY AT $99.98. JUST ABOUT THERE BUT DOWN BY 2%. CAROL: WTI ALSO LOWER IN TODAY'S TRADE SO THAT IS AT LEAST EASING A LITTLE BIT. BUT NOT BACK TO THE LEVELS WE WERE BEFORE THE U.S. WAR ON IRAN. I AM CAROL MASSAR. WHO AM I? WHO AM I? IT IS A MONDAY, EVERYBODY. NORAH: I WILL MESS UP MY NAME JUST FOR YOU. CAROL: AND I STILL HAVE A COLD. I AM CAROL MASSAR ALONG WITH NORAH MULINDA, WHO IS CURRENTLY COVERING STOCK MOVERS FOR AS. WHAT DO YOU HAVE FOR US? NORAH: C.H. ROBINSON WORLDWIDE. THE STOCK IS DOWN. THIS IS A BIG DEAL. AGREEING TO BUY RXO. SEEING SHARES DOWN SO MAYBE INVESTORS ARE NOT WORKING THIS IDEA MUCH BUT IT IS HEADING FOR HIS WORST DAY SINCE JULY AND THE IDEA IS IT IS A BET ON ARTIFICIAL INTELLIGENCE. ONE COMPANY HAS NOT SAID THAT THE RIGHT -- ZACK, RIGHT -- THAT, RIGHT? CAROL: LOGISTICS, WE ARE TALKING TRUCKS. NORAH: THE FREIGHT INDUSTRY HAS BEEN CHALLENGED, BUT THE COMPANY WANTS TO IMPROVE THEIR EFFICIENCY IN THIS CHALLENGING FREIGHT MARKET. THIS IS A CASH AND STOCK TRANSACTION WITH A DEAL EXPECTED TO CLOSE AT THE FIRST HALF OF NEXT YEAR. RXO SHAREHOLDERS ARE EXPECTED TO OWN 11% OF THE COMBINED COMPANY UPON CLOSING COME UP INTERESTING TO SEE HOW THESE COMPANIES ARE TRYING TO THINK ABOUT COST SAVING BUT ALSO ARTIFICIAL INTELLIGENCE AND HOW THEY CAN WIGGLE IT INTO THEIR THOUGHT PROCESS. CAROL: THINKING AI CAN MAKE THEM MORE EFFICIENT IN WHAT IS A CHALLENGING FREE-MARKET. ALSO THE TARGET OFTEN WINS IN THIS. CHRW. YOU ARE ALSO WATCHING TECHNOLOGY. NORAH: I AM. IT IS THE MAKER OF INVISIBLE LINE. I WEAR INVISIBLE LINE -- INVISALIGN. CAROL: RIGHT NOW? NORAH: THE LISP, I CANNOT DO IT. ESSENTIALLY, THE IDEA IS THE LOWER COURT GRANTED A JUDGMENT ENTERED THE PLAINTIFFS PROVIDED ENOUGH EVIDENCE A JURY CAN FIND A LION IN COMPETITION. CONCERNS THAT IT HAS BEEN A BIT OF A MONOPOLY IN THE CLEAR DENTAL ALIGNER SPACE. WE HAD A FEW OTHER BRANDS OUT THERE THAT SELL DIRECT. CAROL: CORRECT, WE HAD A FEW OTHERS, BUT ALIGN HAS BEEN IN MANY WAYS -- NORAH: DOMINATING. BUT IF YOU TAKE A LOOK AT THE START, IT IS DOWN 10% ON A YEAR-TO-DATE BASIS. YOU WILL SEE SHAREHOLDERS A BIT WEARY OF WHAT THIS CAN MEAN FOR A COMPANY. CAROL: UNTIL THERE IS SOME KIND OF RESOLUTION AND WE KNOW WHAT THAT IS. BRACES TO BEDDING? NORAH: HOW DO WE DO THAT SEGUE? CAROL: THERE IS NONE. NORAH: THIS STOCK IS IN THE GREEN ON THE DAY. 6% RIGHT NOW. TAKE OF AMERICA RAISING THEIR RECOMMENDATION ON THE COMPANY FROM BUY TO NEUTRAL, AND THE ANALYSTS ARE CITING A MORE POSITIVE VIEW ON THE PRODUCTION MARKETS IMPACT. THERE HAS BEEN SO MUCH CONVERSATION ABOUT PREDICTION MARKETS. SO MUCH AROUND IT. THE ANALYST JULIE HOOVER SAYING WHILE THE REGULATORY FUTURE REMAINS UNCERTAIN, SHE BELIEVES DRAFTKINGS IS WELL-POSITIONED EITHER WAY. IT IS INTERESTING SHE IS TAKING A BULLISH ON THIS COMPANY, ESPECIALLY WHEN THE STOCK IS DOWN 43% SO FAR IN 2026. CAROL: I THINK THIS IS SOMETHING THAT TIM TALKS A LOT ABOUT THESE PRODUCTION MARKETS, AND I THINK WE ARE FINDING OUT WHERE THEY ARE GOING TO STEP INTO, WHETHER IT IS TRADITIONAL FINANCIAL MARKETS AND A LOT OF TIMES FOLKS SAY THIS IS LARGELY A BETTING COMPANY. A LOT OF E-SPORTS FOR -- A LOT OF IT IS SPORTS. DRAFTKINGS, IF THAT IS ULTIMATELY WHAT THE PREDICTION MARKET BUSINESS TURNS OUT TO. DRAFTKINGS. THANK YOU SO MUCH. YOU ARE DOING DOUBLE DUTY FOR US. NORAH: I AM HAPPY TO. CAROL: WE ARE SO GLAD TO HAVE YOU. CHECK OUT THE STOCK MOVERS PODCAST, FIVE MINUTE EPISODES, BIG WINNERS AND LOSERS IN THE STOCK MARKET. YOU CAN FIND IT WHEREVER YOU GET YOUR PODCAST ON APPLE, SPOTIFY, OR ANYWHERE ELSE. THAT WILL DO IT FOR THE FIRST HOUR OF "BLOOMBERG BUSINESSWEEK DAILY." COMING UP IN THE NEXT HOUR, WE WILL TALK ABOUT A BIG DEAL FOR A COMPANY AROUND FOR NEARLY TWO CENTURIES. WE WILL HAVE AN AI ROUND AND GO TO DOWNTOWN NEW YORK BECAUSE OF THAT ROUNDUP. THE POWER SUPPLY CHAIN AND TECH BILLIONAIRES. NORAH: A LOT TO TALK ABOUT THEIR.