Bloomberg Daybreak: US Edition

Today's top stories, with context, in just 15 minutes.
On today's podcast:
1) President Trump said the US would “not be attacking Iran” before November’s midterm elections, citing “productive discussions” with the Islamic Republic. Trump's comments came despite Iran escalating attacks on tankers in the Strait of Hormuz and Tehran-backed militants in Yemen attacking energy facilities in Saudi Arabia. The president said a US naval blockade of Iranian exports would remain in place, and he has suggested Iran was waiting to see how his Republican Party would do during the midterms.
2) Hurricane Isaias is bearing down on the US Gulf coast. Offshore US oil production is plummeting as Hurricane Isaias pushes toward a coastline dotted with refineries and chemical plants. More than 3 million people reside in the projected path of Isaias, which reached Category 2 strength on the five-step Saffir-Simpson scale Thursday. Roughly 63% of US Gulf of Mexico crude output has been shut in, while 500,000 barrels a day of refining capacity is threatened.
3) OpenAI is expecting to reach or exceed $70 billion in annualized revenue by the end of the year, driven largely by growth in its enterprise business. The company's annualized revenue was roughly $50 billion at the end of September, which represents a projection of OpenAI's yearly sales based on a shorter period. OpenAI is in talks to raise $30 billion or more at a $1.4 trillion valuation before the new money as part of its latest fundraising effort.

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Today's top stories, with context, in just 15 minutes.
On today's podcast:
1) Oil climbed after a report that the White House asked the Pentagon to draw up strike options against Iran that could be executed before the midterm elections. Freight rates are surging, with shipping oil from the Middle East to China costing $1.4 million a day, the most on record. Producers in the Gulf of Mexico shut in more than 510,000 barrels a day of crude output in response to Hurricane Isaias forming in the US Gulf.
2) President Trump defended his immigration policies during a visit to Texas as he sought to boost struggling GOP Senate candidate Ken Paxton ahead of November’s midterm elections. Trump’s defense of his immigration policies comes as Republicans are seeking to shore up their standing with Hispanic voters, whose support for the president has slid in recent polls due to concerns over the economy and affordability issues. Paxton is in a close race with Democratic candidate James Talarico, with recent polls showing Talarico with a narrow advantage, leaving Democrats cautiously hopeful in what has been a reliably red state.
3) Hurricane Isaias has formed in the US Gulf, with top sustained winds of 75 miles per hour, and is tracking toward the coast. Offshore producers have shut in roughly 25% of crude output and 16% of natural gas production, and workers at eight platforms and two rigs have been evacuated. Forecasters are increasingly confident that the hurricane will land east of major energy assets off the coast of Louisiana and Texas around late Friday or early Saturday.

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Today's top stories, with context, in just 15 minutes.
On today's podcast:
1) Iran has increased the pace of attacks on tankers in the Strait of Hormuz in recent days, with UK Maritime Trade Operations reporting nine attacks this month. The impact of the latest escalation on Hormuz shipments and seaborne gas flows is uncertain, according to maritime security officials and shipping executives. The flow of oil through the Strait of Hormuz has steadily picked up since the start of summer, with some Wall Street banks saying shipments are approaching prewar levels.
2) Elon Musk’s SpaceX is in talks with banks and investors to raise $40 billion to buy chips from Nvidia. SpaceX’s fundraising discussions are in an early stage and could end without a deal being completed, with Pacific Investment Management Co. and Apollo Global Management involved. The fundraising is for SpaceX's AI buildout, with the company seeking to raise about $10 billion in bank loans and $30 billion in investment-grade debt to pay for the chips.
3) Less than four weeks until the midterm election, Maine Republican Senator Susan Collins had her first debate last night with Democratic former state senate president Troy Jackson. Both Collins and Jackson got 47% support on that question in a New York Times Siena College poll. The same survey gave Collins a three point edge over Jackson among likely voters. The election is seen as crucial to either party's hopes of attaining a Senate majority, with Democrats needing a net gain of four seats and Collins having repeatedly defied expectations and outperformed polls in her nearly 30 years in the Senate.

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Today's top stories, with context, in just 15 minutes.
On today's podcast:
1) Yemen's government, backed by Saudi Arabia, claimed to have regained territory from the Houthis, as fighting in the region near the Bab el-Mandeb strait intensifies. The Yemeni armed forces said they took control of the Red Sea city of Mokha after battles with the Iran-backed Houthis, and also took over other areas near the Bab el-Mandeb strait. The Saudi-led coalition announced a large operation to recapture Houthi-held territory, and the Houthis responded by firing missiles and drones at the kingdom, targeting the main airport in Riyadh.
2) President Trump is preparing to ease limits on the use of red dyed diesel, a tax-exempt variety of diesel, to pare costs for the essential fuel ahead of the November midterm elections. The plan would allow more widespread use of red or dyed diesel, which is generally available for off-road purposes, and could translate into an effective tax break in some cases. The administration's approach is seen as a bid to address costs for diesel that have surged amid wars in Russia and the Middle East, with retail prices for diesel averaging $6.32 per gallon on Sunday.
3) Billionaire Ray Dalio warned that the Treasury market is vulnerable to a pullback of demand from China and Japan, two of the US’s largest foreign creditors. Dalio said the US relies on foreign capital for about a third of its debt, and that Japan and China have already been paring their holdings. He also warned that the US faces a potential debt crisis within a certain timeframe, and that some borrowers are already starting to feel the squeeze.

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Today's top stories, with context, in just 15 minutes.   

On today's podcast:   

1) Yemen's government launched a full-scale military campaign to recapture Houthi-held territory after weeks of escalating conflict between the Iran-backed group and Saudi Arabia. The Saudi-led coalition will provide full operational support to Yemeni government forces to end the "Houthi coup" and said Saudi Arabia has the right to defend its sovereignty. The aim is for the Houthis to be "eliminated", according to the coalition's statement, as the fighting has pushed up energy prices and led to increased military support from Western powers. Oil swung amid intensified fighting in Yemen and risks to shipping remain acute.   

2) The Pentagon has removed bombers based at the Royal Air Force base in the UK after new threats of a plot linked to Iran emerged. A Defense Department official said all American bombers deployed at RAF Fairford have returned to their home bases in the US. UK Defense Secretary Wes Streeting said Iran was likely responsible for the thwarted attempt to attack, after police arrested a British-Iranian dual national on suspicion of preparation of terrorist acts.   

3) Former Anthropic researcher Jacob Coxon will testify at a New York City Council hearing alongside representatives of some of the world’s biggest AI companies. Coxon quit Anthropic last month and issued a warning about the race to develop increasingly powerful AI, accusing his former employer and OpenAI of “gambling with our lives.” The hearing is part of an effort by New York officials to play a larger role in regulating the AI industry, with proposals under consideration including giving whistleblowers a portion of fines or penalties recovered from AI companies.

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Months after Kayla’s discovery, dozens of women in Levittown, a New York suburb on Long Island, learn they, too, are subjects of faked porn. Most are recent graduates of the local high school, and they zero in on a culprit. One of them sets out to prove it.

For official transcripts and additional information on this series, go to bloomberg.com/levittown

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Bloomberg Daybreak Weekend with Host Nathan Hager take a look at some of the stories we'll be tracking in the coming week.

• In the US – a look ahead to U.S Mortgage data, along with a focus on 3 stocks for the week ahead.
• In the UK – a look ahead to this year’s Nobel Prize decisions.
• In Asia – a look ahead to China’s Golden Week Holiday.

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The US added fewer jobs than expected in September and wage growth slowed, signaling some caution among employers amid rising costs.  

Nonfarm payrolls increased 29,000 last month after a downward revision to the prior two months, according to Bureau of Labor Statistics data out Friday. That missed all estimates in a Bloomberg survey of economists. 

The unemployment rate rose to 4.2%, partly reflecting a growing workforce. 

Bloomberg’s Tom Keene and Paul Sweeney get reaction from: 

• Claudia Sahm, Chief Economist at New Century Advisors 
• Rebecca Patterson, Senior Fellow at Council on Foreign Relations 
• Kristina Campmany, Senior Portfolio Manager at Invesco

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Today's top stories, with context, in just 15 minutes.

On today's podcast:

1) The Pentagon is deploying an additional aircraft carrier and 10,000 sailors and Marines to the Persian Gulf, giving American commanders more options if President Donald Trump chooses to escalate attacks on Iran. The USS Theodore Roosevelt carrier is headed to the Middle East, and when it arrives, the US could again have three carrier strike groups in the region. The US has sent two additional missile batteries to protect oil and gas facilities in Qatar and Saudi Arabia, and the USS Makin Island amphibious readiness group has set sail to the Middle East, giving Centcom additional options.

2) Broadcom's Wall Street syndicate are starting to gather $60 billion of fresh AI chip financing to benefit Anthropic PBC and other companies. Banks are poised to send out syndication letters for a $42 billion Class A senior-secured tranche, and Blackstone Inc. is leading an $18 billion tranche of Class B junior debt. The financing would help firms including Anthropic access chips and other key AI infrastructure, and adds to the hundreds of billions of dollars of debt already raised to build out AI infrastructure.

3) Stocks climbed and sovereign bonds were broadly firm in calmer trading after a week in which markets were lashed by sharp swings in yields. A decline in oil prices supported the upbeat sentiment, with Brent crude falling more than 2% below $100 a barrel. The US jobs report is a key economic release at a time when resilient data are supporting riskier assets while giving the Fed room to fight inflation.

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Today's top stories, with context, in just 15 minutes.   

On today's podcast:   

1) A FlyDubai aircraft was attacked by one of its pilots, who stabbed or hit the other pilot with an ax, before being overwhelmed by passengers. The plane made an emergency landing at a Saudi airport after taking a sudden steep dive, and the United Arab Emirates attorney-general has ordered an investigation into the incident. The investigation will examine the circumstances and motives behind the attack, including whether it was linked to any terrorist activity, and the airline has suspended flights to and from Israel while the investigation continues.   

2) President Trump said former Federal Reserve Chair Jerome Powell should resign from the central bank's Board of Governors over findings the central bank mismanaged the renovation of its headquarters. The Fed's internal watchdog found no evidence of criminal wrongdoing and didn't identify any "administrative misconduct" connected to the $2.4 billion project, but outlined a series of management missteps that caused the project's cost to balloon. Trump directed Attorney General Todd Blanche to study the inspector general's report "and make a determination as to what to do," and said Powell should be forced to resign or sued by the United States Government for "corruption or incompetence."   

3) The US benchmark yield climbed to the highest since 2002 as rising oil prices drove a renewed selloff in global bonds. Government debt has been flailing around the world as elevated oil prices ripple through the global economy, pushing investors to bet central banks will further raise interest rates. Investors will seek clues on the US economy's health and the next Federal Reserve steps from Friday's payroll numbers and a list of Fed speakers.

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