--:-- Caitlin McCabe: Every business wants to grow, but to get there, you must brave the river of certain uncertainty. Or rely on the AI-powered capabilities of SAP to help you grow despite the uncertainty, so your business can stay unbeatable. Bring out your best with SAP.
--:-- Caitlin McCabe: Trump lands in Israel as Hamas releases all living hostages, capping two years of war. In every country, they're dancing in the streets. That's a great deal. It's a unique, it's a unique period in time.
--:-- [Music continues in the background]
--:-- Caitlin McCabe: Plus, the president threatens to send long-range cruise missiles to Ukraine to force a peace deal with Russia. And Paramount makes a bold move to buy a company twice its size. It's Monday, October 13th. I'm Caitlin McCabe for The Wall Street Journal. And here's the AM edition of What's News, the top headlines and business stories moving your world today.
--:-- Caitlin McCabe: We begin today in Gaza, where a significant exchange is unfolding. All 20 living Israeli hostages have been released by Hamas and are now in Israeli hands. Thousands of people in Tel Aviv erupted in cheers and applause as they watched live footage of the first group of hostages being handed over.
--:-- [Sound effects: Cheers and applause]
--:-- Caitlin McCabe: The release of the hostages are the first steps of a ceasefire deal agreed to last week, and which some say could lead to lasting peace in the Middle East.
--:-- Jared Malson: This is a moment of high emotion in Israel and in the Palestinian territories. You have in Tel Aviv, thousands of people in Hostages Square, which is the emotional heart of the movement to free the Israeli hostages held by Hamas in Gaza. And then also in Gaza, crowds gathering around a hospital in the southern Gaza Strip, awaiting the release of Palestinian prisoners who are set to be freed in exchange for those hostages.
--:-- Caitlin McCabe: Jared, it's a pivotal morning after more than two years of war. Can you put this into context for us?
--:-- Jared Malson: The release of the 20 remaining living Israeli hostages is the culmination of two years of trauma for both of these peoples, the Palestinian people and the Israeli people. This ceasefire that's gone into force in the Gaza Strip, finally giving a reprieve for the nearly 2 million Palestinians who have been living through the war. And a very, very significant moment in this crisis that began when Hamas launched its attack on southern Israel on October 7th, 2023, killing about 1,200 people and laying waste to a whole stretch of southern Israel.
--:-- Caitlin McCabe: And I think the hope for many people is that this is an opportunity to finally turn a page on that.
--:-- Jared Malson: There's obviously a lot of uncertainty in terms of how this is going to play out, a lot of fragility to the current deal that has put this ceasefire in place. But for now, it's a moment of high emotions as families on both sides are reunited.
--:-- Caitlin McCabe: And the first hostages were released just moments before President Trump landed in Israel.
--:-- Jared Malson: It seems safe to say he has played a significant role in bringing this ceasefire about.
--:-- Caitlin McCabe: Trump arrival in Israel is significant because he used the threat of him coming to the region really to help force through the deal.
--:-- Jared Malson: When he announced that a deal had been done on Wednesday night there was still actually a lot that was up in the air in the negotiating rooms. And what he did was he forced the hand of both parties saying, get this done because I'm coming. And it really put everyone in a position of having to negotiate the remaining details or be in a position where they'd be saying no to the visiting president.
--:-- Caitlin McCabe: And that's how this came together. And that's what we saw this morning with Air Force One touching down just minutes after the release of the first group of hostages.
--:-- Jared Malson: And that's really significant in terms of how he was able to use his kind of unorthodox style of diplomacy to get this done.
--:-- Caitlin McCabe: Jared, Trump has been sounding positive about the prospects of long-term peace, telling reporters that the war is over.
--:-- Jared Malson: Today, he's meeting with several world leaders in Egypt to discuss the ceasefire plan. But what kind of obstacles are there to lasting peace?
--:-- Jared Malson: In the region in general, I think there's a sense that this deal is a hostage deal. It gets the hostages out, it gets Palestinian prisoners released, and it gets a ceasefire in place in Gaza for now. The longer-term aspects of the plan have a lot of fragility built into them in the sense that there still needs to be a negotiation around an actual Israeli withdrawal.
--:-- Caitlin McCabe: Do we know any details about Israel's withdrawal from Gaza and what that might look like?
--:-- Jared Malson: We know that the Israeli army has redeployed within Gaza. That's the word they're using. They are still on the ground in some parts of the Gaza Strip. And their future withdrawal closer to the Israeli border is contingent on how the next round of negotiations unfolds.
--:-- Caitlin McCabe: And Jared, I think the big question on everyone's mind is, and obviously this is further down the line, but how will Gaza be governed after this?
--:-- Jared Malson: That is one of the huge questions that's hanging over this entire situation. Trump's plan calls for a new government of Palestinian technocrats that would take charge from Hamas. But who those people are and how much power Hamas is going to cede and how that transition would actually go is all up in the air right now.
--:-- Caitlin McCabe: And there's also supposed to be a role for an international force of peacekeeping troops that's envisioned under Trump's plan. But that's also still to be formed.
--:-- Jared Malson: And again, it's all to be determined who those troops would be, which countries they're coming from, when they're arriving, what role they're going to have, how they would coordinate with Israeli forces and interact with Palestinian forces on the ground.
--:-- Caitlin McCabe: Jared, you've also been reporting on how U.S. troops began to arrive in Israel late last week. What will the United States role be in all of this?
--:-- Jared Malson: So those troops that are in Israel are supposed to arrive in Israel there to help coordinate the ceasefire itself. They are playing a kind of supporting role we understand in making sure that this goes smoothly on an operational level.
--:-- Caitlin McCabe: US officials have repeatedly said that there will be no boots on the ground in Gaza itself.
--:-- Jared Malson: So my understanding is that it really an operational role that they playing making sure that this goes smoothly. As you know, one issue that they're going to have to figure out is the fact that both the IDF, the Israeli military, and the fighters affiliated with Palestinian factions are both still on the ground in Gaza in close proximity. So they'll have to deconflict.
--:-- Caitlin McCabe: Well, Jared, thank you so much for filling us in on this. Really appreciate you taking the time today.
--:-- Jared Malson: Thank you.
--:-- Caitlin McCabe: En route to the Middle East, President Trump weighed in on a different war and threatened to send long-range Tomahawk cruise missiles to Ukraine as a way to put pressure on Moscow to negotiate a peace deal.
--:-- [Sound effects: Airplane taking off]
--:-- Caitlin McCabe: Trump made the comments to reporters on Air Force One.
--:-- President Trump: I might say, look, if this war is not going to get settled, I'm going to send them tomahawks. I may say that the tomahawk is an incredible weapon, very offensive weapon. And honestly, Russia does not need that. They don't need that.
--:-- Caitlin McCabe: Yeah, I might tell them that if the war is not settled, that we may very well. We may not, but we may do it. I think it's appropriate to bring up.
--:-- President Trump: Yeah, I want to I want to see the war settled.
--:-- Caitlin McCabe: Trump met with Volodymyr Zelensky last month and told the Ukrainian president that he was open to lifting restrictions on Kiev's use of American-made long-range weapons to strike inside Russia.
--:-- Caitlin McCabe: The president didn't make any commitments to reverse a U.S. ban on such attacks.
--:-- Caitlin McCabe: And back in D.C., the government shutdown is finally starting to bite, with federal workers already starting to mispay and some businesses who count on a functioning federal government saying layoffs and costly delays will accelerate.
--:-- Caitlin McCabe: Over the weekend, one of the most potent consequences of the shutdown was resolved as President Trump announced a move to pay the 1.3 million active duty servicemen and women, as well as members of the military reserves and National Guard.
--:-- Caitlin McCabe: Meanwhile, over at the Centers for Disease Control and Prevention, the Trump administration is moving to keep some staffers after telling them Friday they were being laid off.
--:-- Caitlin McCabe: According to the National Public Health Coalition, which represents laid-off CDC employees, out of the estimated 1,300 workers who were cut at the end of last week in response to the shutdown, about 700 of them were rehired on Saturday.
--:-- Caitlin McCabe: Despite informal talks taking place on how to exit the shutdown, both sides remain firmly dug in on their positions.
--:-- Caitlin McCabe: Republicans blame Democrats for failing to provide the votes to approve a spending bill passed by the House, while Democrats want assurances that Congress will extend health care funds.
--:-- Caitlin McCabe: Coming up, the battle brewing for the future of Warner Brothers Discovery. And we take stock of markets this morning following Friday's sell-off after the president threatened new tariffs on China. That's after the break.
--:-- Caitlin McCabe: Truestage helps make annuities simple. Our flexible products and personalized support help you build stronger relationships and grow your business with confidence. Discover how at truestage.com slash grow. Truestage is the marketing name for Truestage Financial Grouping. Get subsidiaries and affiliates. Corporate Headquarters is located in Madison, Wisconsin.
--:-- Caitlin McCabe: Paramount's push to take over Warner Brothers Discovery appears to be heating up.
--:-- Caitlin McCabe: According to people familiar with the matter Paramount Chief Executive David Ellison is making a play for all of Warner before it splits off its cable business from its TV film and streaming business.
--:-- Caitlin McCabe: We understand the majority cash offer would be heavily backed by the Ellisons and that while Warner board is aware of the proposal Ellison is also considering taking a more aggressive approach, such as taking an offer directly to shareholders.
--:-- Caitlin McCabe: The bold move comes just a few months after Ellison's Skydance Media closed its deal to acquire Paramount.
--:-- Caitlin McCabe: U.S. stock futures are heading higher this morning following a sell-off Friday that sent the S&P 500 falling 2.4 percent.
--:-- Caitlin McCabe: The decline, which was the biggest for the index since April, was fueled by President Trump's threat of massive tariffs on goods from China, a position he seemed to walk back slightly last night.
--:-- Caitlin McCabe: In a social media post, Trump said, quote, it will all be fine, and that, quote, highly respected President Xi just had a bad moment, unquote.
--:-- Caitlin McCabe: He added that the U.S. wants to help China, not hurt it.
--:-- Caitlin McCabe: Asian stocks fell Monday after Trump's post, but U.S. stocks, in contrast, appeared poised for a rebound.
--:-- Caitlin McCabe: Gold, meanwhile, continued to rise above $4,000 a troy ounce.
--:-- Caitlin McCabe: Well, despite fresh tensions in the trade war with China, prospects for U.S. economic growth are looking up.
--:-- Caitlin McCabe: That's according to the journal's latest survey of economists, which was conducted earlier this month.
--:-- Caitlin McCabe: Anthony DeBarros is the journal's data news editor. He says while economists have raised estimates for economic growth, thanks in part to the Trump administration signing agreements with key trading partners, including Japan and the European Union, they've lowered prospects for jobs.
--:-- Anthony DeBarros: Well, what we've noticed in the last few surveys is a weaker job picture overall. As opposed to GDP and growth, economists are seeing the labor market as weaker coming up.
--:-- Caitlin McCabe: For the next 12 months, on average, they see about 49,000 jobs added a month, down from 74,000 in the previous survey.
--:-- Anthony DeBarros: And I think one of the reasons behind that is that even though there's more certainty around tariffs, employers still have been reluctant to hire because there's been a lot of political uncertainty about rising costs and their investment.
--:-- Caitlin McCabe: And artificial intelligence is also boosting productivity at the same time.
--:-- Anthony DeBarros: And economists don't see slower job growth translating into notably higher unemployment.
--:-- Caitlin McCabe: So even though economists are foreseeing fewer jobs created on average each month, they're not forecasting that unemployment is going to notably rise.
--:-- Anthony DeBarros: And one of the reasons is because of the Trump administration's crackdown on immigration. It's reducing the supply of workers.
--:-- Caitlin McCabe: So economists are expecting that the jobless rate is going to hover around four and a half percent over the next year.
--:-- Caitlin McCabe: For more on this survey and just how the U.S. economy is shaping up, go to WSJ.com.
--:-- Caitlin McCabe: And that's it for What's News for this Monday morning.
--:-- Caitlin McCabe: Today's show is produced by Daniel Bach and Kate Bollivant. Our supervising producer is Sandra Kilhoff. And I'm Caitlin McCabe for The Wall Street Journal. We'll be back tonight with a new show. Until then, thanks for listening.
