Good morning. Markets get some relief, we’ll tell you why. Elon Musk is ready to shift gears (Tesla investors may approve). And The Shining hotel has some big plans. Listen to the day’s top stories.

US futures jumped and the dollar edged up after Donald Trump defused some of the tension that have rattled financial markets. The president said he had no intention of firing Federal Reserve Chair Jerome Powell despite his frustration with the central bank not moving to cut interest rates. However, it would be unwise to think of this as a true turning point, writes Bloomberg Opinion's John Authers (more from him later).

Adding to the positive mood, Trump said he plans to be “very nice” to China in any trade talks and that tariffs will drop if the two countries can reach a deal, a sign he may be backing down from his tough stance on Beijing. “It will come down substantially but it won’t be zero,” Trump said. Treasury Secretary Scott Bessent had earlier said that the standoff was unsustainable.

Time to shift gears. Elon Musk vowed to pull back “significantly” from his work with the US government to concentrate on Tesla, easing concerns of investors following first-quarter results that came in below estimates. Musk’s controversial work at DOGE and his political rhetoric have sparked vandalism on Tesla dealerships, and prompted  analysts to warn over the company’s future.

Over at Intel, the company is poised to announce plans this week to cut more than 20% of its staff, aiming to eliminate bureaucracy, according to a person with knowledge of the matter. The move is part of new Chief Executive Officer Lip-Bu Tan's bid to turn around the struggling chipmaker, which has lost ground to rivals. Here’s a QuickTake on how Trump’s efforts to scrap the Chips Act would impact Intel.

Demographic check. The number of US births rose last year after falling in 2023, driven entirely by Hispanics and Asians, based on provisional data from the CDC’s National Center for Health Statistics. Despite the annual increase in births, the total fertility rate remained below the replacement pace. In China, a falling birth rate may imperil its economy as it aims to overtake the US.

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Deep Dive: DC Takes a Hit

Commuters cross Pennsylvania Avenue near the Capitol in Washington, DC. Photographer: Al Drago/Bloomberg

Speaking of DOGE (check above), Elon Musk’s cost-slashing campaign is causing unprecedented upheaval in the US capital, which usually enjoys stable employment.

• The swift campaign by Trump and Musk to rein in government spending is expected to throw a wrench into the economic engine that built modern Washington.
• Musk’s special department has fired thousands of federal employees, and wants to close agencies and tear up billions of dollars in government contracts.
• The district is expected to lose as many as 40,000 federal jobs, the city has estimated, or 21% of its federal workforce.
• The area is bracing as Washington tends to be a bastion of high salaries and federal jobs that bring security seven in the worst of times.

The Big Take

Photographer: Glenn Harvey

“Flash boys” are no longer flying under the radar and want to shake up the global stock trading order. High-frequency trading firms like Optiver are emerging from the shadows to trade directly with investors, bypassing traditional brokers and exchanges.

Opinion

Jerome Powell, chairman of the Federal Reserve. Photographer: Jamie Kelter Davis/Bloomberg

Raising the possibility of firing the Fed chairman was an unforced error by the White House, and the messaging suggests chaos, John Authers writes. The actual announcement of hugely important market-sensitive information came ad hoc in response to a reporter’s question. Which makes you wonder: Would the issue have been cleared up without a question?

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Before You Go

The Stanley Hotel in Estes Park, Colorado. Photographer: Helen H. Richardson/Getty Images

The hotel that inspired Stephen King’s The Shining is building an event center and museum to cater to horror fans. The Stanley Hotel in Colorado is borrowing $300 million, hoping to capitalize on the Sundance Film Festival’s planned move to Boulder in 2027. And happy belated birthday to Jack Nicholson who turned 88 yesterday, and starred in the classic Stanley Kubrick film adaptation of the book.

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