it's an amazing thing when you show generosity of spirit to someone. and you want people to be saved and to have a better life, then you don't stop. we have been able to reach over 100 million people impacted and affected, and at risk of hiv. the rocket fund takes all of the work that we're doing, all over the world, and looks at the most effective ways, to get resources to them, to get services to them. the idea that we have saved five million people's lives, it's overwhelming. it's everything. >> good morning, this is "bloomberg daybreak: europe."

i am tom mackenzie. israel launches a strike on iran according to u.s. officials, but are conflicting reports out of a ron about the extent of any damage. iranian immediate reports of the country's new facilities are safe. stocks slump as investors rushed to haven asset on concerns of a widening middle eastern conflict. brent crude spikes above $90 a barrel, plus voters in the world's largest democracy said to the polls. we will be live in india as the election gets underway. the fog of war is present for us as we try to get more details on these stripes we are hearing from u.s. officials, one strike from israel to iran. we are awaiting the details. the senses either the contacts were limited or that the iranians are playing this down

or both things are true, but we wait for more reporting to get clarity on what is happening regarding the response from israel to the iranian attack over the weekend. there is been a move into havens as we said, some of that in the last 30 minutes to one hour has pared on the back of pushback from a state media suggesting they are less concerned about what is going on or playing down the impact, but you get risk off still there. futures pointing lowered by 1.6% for european stocks. u.s. futures pointing lower by .9 of 1%, but it was a much bleaker picture about an hour ago. nasdaq futures lower by 175 points. ftse 100 down 82 points. a look at some of the safe havens. there was a move into u.s. treasuries, at one point the 10

year yield dropped to 14 basis points, a big move into gold and oil above $90 per barrel. no safe haven moves have pared as well. have we peaked in terms of safe haven moves. that remains a question. the ripple across the fx markets of asia pronounce. bolded 2384 -- gold at 2384/ . you did see a spike of 3%. you are now up 2%, and that tenure and treasury curve remaining bid, 455, an eight basis point move lower on the u.s. a benchmark. let's cross over to aj and get a sense of how markets are reacting. avril hong is standing by for us in singapore. avril: we saw the reaction

letting clear when the initial unconfirmed reports came through, and it was a sense of risk aversion and safe haven demand. we saw the gauge of stock something as much is 2.5%. nikkei losses accelerating as much as 3.5%. infotech sector to biggest loser as a got a double whammy from hawkish fed speak as well as tsmc lowering its outlook for the chip sector. you get the sense of that traders are not prepared for the sudden revival in middle eastern gents. i also want to highlight that made all of this we are seeing chinese stocks relative outperformance or at least the bleed was not as bad, a sign of how much chinese equities have decoupled from global financial markets. at the other thing i went to

highlight is what we see on the japanese yen. we did see safe haven demand, compared to what we are seeing on treasuries, gold, the moves in the end versus the greenback quite tepid raising the question about its role as a traditional safe haven. as we look at how the em fx have been taking a beating today, it is the renewed pressure no thanks to the initial surge in oil prices. you wonder what the economies, the readthrough potentially from inflation might be given higher oil prices. rupee briefly hitting a fresh record low. your korean won also hearted today. tom: thank you very much. let's get the details, u.s. officials saying israel has struck targets and western iran

after multiple reports of iranian news agencies of explosions around the city of is fahen. all nuclear sites and military are safe in the city. let's get more from our correspondent. what do we know at this point about the strike? >> it is a fast-moving story indeed. we woke up hearing of explosions around isfahan. two u.s. officials confirmed israel was behind this attack. shortly afterwards we heard from the israeli army radio saying they targeted an air base which happened to be the same airbases that launched the missiles and drones because weekend before their own retaliatory response to the israel attacks on the diplomatic consulate in syria just a few weeks before, so

there was a tit-for-tat taking place at this point in time, but what is crucial is iranian state media have sought to downplay what is happened overnight. we heard from a state affiliated station saying that there are no reports of the central city or any part of the country and that iran's own defense system had indeed been activated. they were quick to say no nuclear sites or keep military sites had been harmed, and for markets that sought to be a bit of a turnaround, because the nuclear site is what people will about being targeted, but of course this comes as we spoke about on the hills of iran's on direct attack on israel last weekend. four days there has been a rapid speculation about how israel would respond. its allies including the u.s. and other arab countries have

tried to downplay the situation and have cautioned prime minister netanyahu an extreme response. it appears to be a limited and proportionate response specifically targeting this one airbase, and this is why you were seeing reversal in the markets, because it seems to be limited in per or should it at this point in time, the details are still fuzzy and remains to be seen. tom: the fascinating response coming through from iran and how we decode that will be crucial in the minutes and hours ahead. in terms of your assessment at the escalation to risk, you talked about the diplomacy working its way to the region in the last few days. what is the assessment of the escalatory risk given to strike a bit u.s. officials say has happened? >> i think it is important to talk about the iranian response and what would actually prompt a

bigger retaliation out of iran at this point in time. yesterday that the iranian foreign minister was speaking at the security council at the u.n. , and he actually said yesterday so far there response one week ago was sufficient, that they get done what they need to do do, and he warned israel of further adventurism in their response. whether or not the attack meets the threshold of them responding further we do not know at this point, but what we do know is internally the state media, the press or downplaying what is happened. they are assessing what is happened, even state media are denied reports that his security meeting at the top level are taking place, but the context is important. the attack last week was the first direct confrontation between iran and israel.

it is the second time they launched their own direct attack on iran. typically it goes through proxies, and hamas closely affiliated with iran as well, so there are concerns that other iranian proxies could also get dragged into this as well. tom: bloomberg's middle east anchor with the latest on this unfolding story. she will be joining us again in the second half of the so with -- half of the show. oil markets in focus, brent, wti following strikes in a run, brent paring gains after rallying as much as 4.2% on these concerns about a regional conflict could endanger crude supplies. let's bring in our stephen -- senior energy reporter. what is the reaction so far?

what do you make of the weight will markets have reacted to the news? >> i think shock and the relative anxious calm. when there were the first unverified reports coming through on twitter, you saw a sharp reaction in oil prices, because there were folks who were not sure what was happening . there were unverified reports of explosions, and as more detail started to be teased out, bloomberg reported were able to confirm u.s. officials were aware that israel had launched as strike, and through that oil prices started to calm a little bit, but we are still 2% above where we started the day. clearly as what is been explained just moments ago, it does look like iran is trying to downplay this, and it does not look like there was any sort of retaliation from the iranian

side on all of this, but there was a fog of information coming through, so it is challenging to see how this will happen, but when you talk to traders and look at the market, it does not look like people are expecting wider, which is a chunky increase for today. tom: 88.91 on brent. thank you for the reaction to the story. thank you. to the macro, a new york fed president john williams saying there is no rush to lower interest rates. the geopolitics, but markets continuing to digest hawkish comments from fed officials. williams was speaking at a summit in washington and said economic it will determine the timing. >> my expectation of right now

is interest rates are indicated place, and eventually at some point we would want to lower interest rates as the economy gets into 2% inflation we are headed toward. if we need higher interest rates to achieve our goals, we would obviously want to do that. it is not my base case. tom: let's bring in jill disis. hey let the cat out of the bag. she said it is not his default case, he put on the table the prospect of a hike, another hike from the fed. >> what are turnaround we have had even over the past couple of weeks. you look back at the beginning of this we and some of powell's comments and how much we have pushed out this idea of interest rates coming in this year. i remember just a few weeks ago we were talking on this program about the fact there were

greater expectations as something is in his june. now we are talking about one or two cuts in 2024, some say none in 2024, and now you have got williams flooding the potential of a possible hike. this underscores how stubborn that last mile of bringing inflation down trying to reach the 2% annual target, how difficult that is to accomplish. the other thing traders are keeping in mind now, this is absent all of these new geopolitical risks that have bubbled up out of the middle east today. now the central bank convergence we may be experiencing between the fed and ecb and the ecb telegraphing the idea of a cut coming is in his june, when you were taking that into consideration now from what you were hearing from williams and the fed pushing back expectations of rate cuts, it

shows what a turnaround we have seen and how difficult it is been to calculate the fed trajectory through the rest of 2024. tom: pivoting on the pivot. jill with the analysis, thank. here is what is else on your agenda. a gauge on the health of the u.k. consumer. we have been hearing about the bank of england governor and releasing inflation remains us of a challenge. on the earnings front, procter & gamble and american express, a touch on the u.s. consumer that remains relatively strong according to recent data, and today we get continuation of the imf and world bank meetings as well in the u.s. we will be listening out for a new sound as they address economic inflationary and central-bank challenges.

almost one billion people in india begin dividing today in the world's largest ever general election. it will last over six weeks. we are live in the city. that is next. this is bloomberg. ♪

tom: welcome back to "bloomberg daybreak: europe." let's turn the focus to india where the largest democracy had

into the polls in an election said to last six weeks. i minister modi is hoping to emerge with a third five-year term. as haslinda amin has been looking at this for us, but let's bring in our correspondent on the ground outside the station in a southern city. what is the mood on the ground ahead of the start of this mammoth vote for india? >> the mood is hot. you will see fewer voters behind me that we did witness earlier this morning as the sun climbed through the day. this is also a weekday, and we might see a last-minute rush. as you mentioned, this is an important election domestically and for the global economy.

india is the world's fastest-growing economy, the world's largest economy at the largest democratic electoral process in the world. prime minister modi is looking for a third term, but that is not all. she is looking for a third term with the super majority of 400 or more seeds of the total 543. that ambition here will be a protest because several parts of southern india have not yet been charmed by prime minister modi. his party did not win a single seat here. if he wants to take the number of seats she needs to win -- he needs to win voters in southern india. that is the battle, and this is a seven phase election, so we

have six more weeks of reporting to do in peak summer. tom: you will be very busy indeed. he needs to win the vote. >> and hot. tom: how we see hoping to win over the voters -- how is he hoping to win over the voters? globally this is a hugely significant vote. >> prime minister modi's 10 years in power have been characterized by a few things. gdp growth, yes, but lower than previous decades, but that could be contextualized to is living global economy, but it has also been a time he has chosen to assert a fairly strong leadership style, he has chosen to emphasize majoritarianism

and religion and is announced a slew of welfare schemes and a large amount of money into an infrastructure push in india, and his constant refrain is he wants to see india as a developed country by 24/7 within 100 years have india's independence, so it is an interesting mix of politics that is taken place over the past 10 years. growing above 7% in terms of gdp. it there were weaknesses in the economy such as low consumption numbers, joblessness, which is a critical and chronic problem, and all of these need to be fixed in subsequent terms. tom: on the ground for us at the start of this marathon vote for india. i deficit of high quality iron ore is adding to the challenges

of greening the steel industry. our weekly deep dive on the green transition and we keep across all of the geopolitics for you and the market reaction. this is bloomberg. ♪

tom: time for our weekly deep dive into the green energy transition, a shortage of high quality iron ore is proving a hurdle for the steel industry as it attempts to curb its emissions. mobile demand is expected to outpace supply and could reach a deficit of 133 million metric tons by 2030. our guest joins me now with all the expertise.

how much more steel demand will come from this energy transition? >> the energy transition will be a relatively small demand for steel as the traditional sectors including wind turbines and solar panels will use c.e.o. as the fundamental material, but this is relatively small compared to traditional sectors include two construction and auto making. if the world is to get on track for vera submission -- zero emissions by 2050, they will more than triple in the current decade. tom: still producing a lot of emissions. how is the industry looking to clean up its act? >> steel production is not very clean today. it is responsible for about 8% of global co2 emissions, about

5% in the eu, and that is because production largely relies on burning coal to produce iron ore into iron, and many steel companies are betting on hydrogen as a replacement for coal. another catch is that the hydrogen-based reduction of iron ore requires high quality iron ore. today we are seeing a shortage in the supermarket for this graded material, and that deficit is said to grow in the decade is more demand from green projects ramps. tom: who is driving the momentum in terms of that demand? >> currently the middle is driving the demand, but europe is set to grow fast as the

region looks td carbonized and particularly as reallocation of emissions is said to be phased out, and europe is on track to become the second largest center for reduction in iron ore overtaking asia by the end of the decade. tom: thank you very much indeed. if you would like to hear more from bnf's analysts, log onto the terminal. u.s. officials confirm israel as drug targets in iran

♪ tom: good morning, this is bloomberg, i am tom mackenzie.

israel launches a strike on iran but there are conflicting reports about damage. the country's nuclear facilities are safe. investors rush to save havens. brent crude spikes and voters head to the polls. india's election gets underway, let's check in on these baskets -- markets, i should say. we are very much in risk off territory, safe havens pairing in this session, looking at futures in the red when it comes

to the stock market. european futures are lower, ftse futures lower and s&p above 5000 for five straight days pointing lower by 8/10 of a percent. hawkish commentary front and center. a strike on iran. nasdaq futures are lower, but let's look at how money has moved. you've seen yields move lower, undoing selling pressure at the front end when it comes to the u.s. treasury market. yields are down close to seven basis points. cold lifting -- gold lifting. $88 98 on brent, breaking

through that on the day, up 2%. 89 a barrel on brent, continued christ's precious. let's get the latest on geopolitics. israel struck a ron. explosions around the city. state media saying all nuclear sites are safe so let's get the details. what do we know who at this point? >> good morning. ever since the attack there has been speculation as to how israel will respond and. response came overnight,

explosions heard around iran's third-largest city in the morning. u.s. officials confirmed israel launched an attack. details are fuzzy, but we understand the target of the attack was the air base. it was an airbase iran used to launch drones and missiles. now at this point, what we are hearing from state officials is they are downplaying the attack, quick to say no nuclear facilities had been targeted. there was no harm in that because a turnaround because there was concern israel would go after nuclear facilities and they were saying moments ago, local media says there are no reports from abroad on arad's

central's -- iran's central city. their own air defense system was the swaths of all of that. details are fuzzy, but analysts are quick to point out that if this was the israel response to those attacks last weekend, they are deemed limited and proportionate. it is up to the armenians on how they will respond. tom: give us more detail in terms of the response and implications. >> yes, iranian state media have denied a security council meeting is taking place so all we can parse is what we're hearing from state media and they have been denying reports of damage in the country, but

israel themselves are preparing for retaliation, u.s. embassy in jerusalem staff warned of retaliation, but as we were just referring to because this appears to be a limited strike perhaps it could be deemed insufficient to warrant a response. yesterday the foreign minister was speaking and warned against adventurism. whether or not this qualifies remains to be seen. it is a fast-moving story. tom: the test will be crucial. thank you very much indeed with all the latest on this story out of dubai, let's get a deep on

market reaction, treasuries jumping with the dollar as concerns over escalation. further escalation in the middle east bolstering demand for haven assets, some has eased. let's bring in bloomberg's mliv team for reaction. what is your take? ven: morning. market reaction has been measured and that reflects one strike on a base, we don't know whether this will be the only retaliation so reaction will depend on the how protracted the epicenter will be, but there has

been measured reaction. flight toward havens. as you said, that has come off. going forward, it will be the degree of response and how protracted that will determine whether or not havens are bid. tom: we talked about the yen, gold and gains have used in the last hour or so, where are the money flows? ven: three havens are treasuries, german bonds and gold. treasuries and bonds are where money will go because people want safe assets. gold surged on signs that the conflict could escalate and the

move is contrary to everything else. rates have gone up, that would bring the value up and investors priced in 80 rate cuts at the end of february and now they reckon less than two rate cuts so that is a factor that should have humbled gold. suggesting gold is a haven if this conflict proves to be protracted. tom: thank you indeed around the favored havens given this conflict for our team, thank you. now to europe, olaf scholz says he is sending a third hatchery at system, speaking to reporters

after an informal meeting in brussels. they are pushing for stronger support, let's get more from olie crook covering this meeting out of brussels. what is ukraine's defense situation? ollie: it will not be enough. ammunition shortage is something we have been talking about. russia is firing more artillery shells. really focusing within ukraine on power and they sending another patriot system. they can expect six on the way, great frustration best embodied by candidate tweet put out by donald to's that of all the

words said about common defense could be changed into bullets, europe would become one of the strongest powers in the world and that echoed some things we've heard from defense ceos saying if you want to deliver on a paradigm for european defense, we need to make decisions now and the question is around financing, but there is a disconnect between rhetoric and action. we said the german foreign minister push for support, but the major breakthrough is mike johnson bringing this to the house to get aid that has been stalled for six months. that could have movement tomorrow. tom: does johnson get that or

ousted by republicans in his own party? mario with priorities europe should focus on, chinese influence, did they come up with any answers? >> the consumer is no. mario gave a report kind of late two leaders and teams did not have enough time to read it to get conclusions. they made that speech and we saw a draft of the conclusions that included a line saying europe needs a paradigm a shift, where the sticking points where was the capital markets union. more centralized supervision.

france, italy, spain, netherlands are in favor. you had a question of harmonizing estonia and ireland. this shows the difficulty of consensus. they are talking about economic obsolescence for europe, but there is so much complicated politics and forward progress is challenging. tom: thank you very much indeed with the latest. now we bring you more lines indeed when it comes to what u.s. officials say. is this strike on iran the international atomic energy agency confirming no damage, no damage to the nuclear facilities and nuclear sites, backing up what we have been hearing from media who said the sites had not been damaged.

now they confirm no damage to the nuclear site. a strike would have been a worst-case in terms of potential risk within the region. it is a scenario that has not played out. no damage. we keep across the story. plenty more on the earnings front, we break that down with focus on netflix. this is bloomberg. ♪

♪ tom: mo cowan back to bloomberg daybreak: europe. let's focus away from geopolitics. let's focus briefly on earnings because netflix shares fell

despite the best start to the year since 2020. they added nearly double estimates so let's bring in chloe meli. how did netflix do? chloe meli: by and large, they feet expectations in terms of subscribers to beat earnings and sales. and it created operating forecast for the year but there are things that worry investors, the first being subscriber metrics from first quarter of 2025, which means there was a slow down and also second-quarter is weaker, probably why there were a little bit of weakness. tom: they benefited from the clamp down password sharing.

there is a question whether that will continue to benefit them. chloe meli: the password crackdown is boosting them and they've introduced subscription with ads developing quite well. 40% of customers are choosing that option and it is strong programming in the first quarter. love is blind, the gentleman, really good success. tom, thank you indeed. switching to luxury space, lori l bouncing back in the. saying strength in europe and north america offset sluggish demand in the market of china. let's bring in deborah aiken from bloomberg intelligence for a deep dive. key drivers behind sales, deborah? deborah: the big thing, a couple

hundred basis points ahead of market expectations, 13% growth and stock underperformed into the sales number on the back of data from old where the product was seen as old in the stores. and there was an expectation that they may have just met, very good. and then double digit growth, plus 10% in north american market, doing well in mass-market. christ's pinches going through there. a big area, dermatology. 20%. overall there were three out of four sectors and three regions that did well. tom: talk to us about china?

>> china is up 6% actually against a mock kit which is flat, higher than in quarter four so they gradually improved versus china are. china is gradually improving, slow pace. outside on the look side, just less than 2% north asia is down, market flat and the travel retail industry, we've heard from lori l, the prairie brand, they are waited for travel retail. lori l says it's better than it was. they could sell out stronger and they are pitching for the second half. travel retail outside of china, for asian we are waiting for 25%

versus 2019 whereas most other regions we expect 100% by the end of this year. middle eastern numbers above but we are seeing more -- we've covert this a little bit but money from china to japan to singapore in others, so the china number is kind of mystifying number versus where the money has been spent. the chinese cohort. tom: thank you with the analysis in terms of these numbers and the read across and different segments. plenty more, we will keep across the story with the market reaction to the crucial story. also reaction to commentary from fed officials. stay with u this is bloomberg. ♪

it's an amazing thing when you show generosity of spirit to someone. and you want people to be saved and to have a better life, then you don't stop.

we have been able to reach over 100 million people impacted and affected, and at risk of hiv. the rocket fund takes all of the work that we're doing, all over the world, and looks at the most effective ways, to get resources to them, to get services to them. the idea that we have saved five million people's lives, it's overwhelming. it's everything.

♪ >> every time we come up to these events it comes to supply and demand. >> given the interest rate environment, crypto, we are not disconnected from what is happening in equities or geopolitical environment. >> our business requires long-term planning and the evolution of mining has changed. >> investors are interested in

what the market reaction will be. tom: let's bring you the details. u.s. officials saying israel struck sites in iran, international atomic energy agency saying nuclear sites in iran are not impacted. here is the map. the location of the key nuclear facility with state media saying no damage to the sites. that had been a west case scenario in terms of spiraling potential if israel damaged the site. state media saying no damage and

we continue to work out the details. iranian officials and media are downplaying what officials tell us is this attack. let's see the market reaction. risk off moves have peaked, here is oil impact. the upside, we are at half of what we saw. we saw prices spike, crossing $90 a barrel level. gains of under 2%, paring risk off move. 77 on brent. that is on the back of news lines and paired price gains in brent. let's look at other haven moves. gold bid as well, giving up

gains. almost back to pre-event levels. 2400 is a key level for the yellow metal indeed. and if anyone thought bitcoin was a haven, that has been put to bed. this is the yields in terms of treasury yields. more analysis in great detail, markets today is next. stay with us, this is bloomberg. ♪

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>> good morning, i'm anna edwards alongside guy johnson and kriti gupta. it is what you need to know. a strike on, ron, c