Clashes Erupt In Hong Kong As Protesters Try To Storm A Government Building; Global Markets Bounce As The U.S. And China Back Away From New Tariffs; Oil Rallies Amid Expectations Of A Deal As OPEC Meets.
KOSIK: Welcome back to FIRST MOVE. I'm Alison Kosik live from the New York Stock Exchange. What you just heard that was the opening bell on this Monday morning, and as expected, we got a solidly higher open across the board for U.S. stocks as we begin the second half of the trading year, hopes that the U.S.-China trade truce will lead to a final trade deal that as you can see is boosting sentiment. This is going to be a holiday shortened trading week on Wall Street. Markets, they're closed on Thursday for the Fourth of July. There's a shortened trading day on Wednesday as well. That said, it will be a busy week for U.S. data. The U.S. jobs report for June that comes out on Friday and with the trade truth in place, markets will focus once again on expectations for any Fed rate cuts or hints of that. The big question here will rate cut expectations diminish if hiring rebounds from May's tepid levels. So as we begin the trading day, the S&P 500 is currently in record territory. We will continue to take -- to keep an eye on the markets today. All right, let's take a look at how global markets are doing. Stocks are higher, pretty much across the board. As you could see, the Nikkei, the Shanghai Composite both gaining more than two percent, and as we mentioned, investors have a fresh spring in their step following a climb down in the U.S.-China trade war. Clete Willems, was formerly the lead negotiator for the U.S. at Summits such as the G20. He's now a partner at the law firm, Akin Gump. Clete joins us live from Washington right now. So happy you can join us at this pivotal moment because now that we see that talks are back on track, everyone is kind of looking at how that actually happened. We saw the U.S. make a big concession on Huawei allowing the company to buy tech equipment from the U.S., but the administration, it has been clear that Huawei is a national security threat. So what happens here?</s>CLETE WILLEMS, PARTNER, AKIN GUMP: Well, I think what the administration is saying on Huawei, is that there is a difference between having a national security threat to being a part of your networks, and producing cell phones for use in China with American parts. And I think you can distinguish these things. And I think the administration's position is defensible. I think they don't want to let Huawei penetrate the networks. But if U.S. companies want to do business on things that aren't directly related to that, they may let them do so.</s>KOSIK: Okay, so you look at the China trade war itself, you know, for all the hand wringing going on about President Trump's tough stance on tariffs against China, you know, some Republican and some Democratic lawmakers, even they're worried that President Trump will actually give up too much in any deal he is going to make because he is eager to make a deal. Do you see that happening?</s>WILLEMS: No, I don't see that happening, and I think it's really interesting that there was no deadline coming out of this meeting. By all accounts, the meeting went well, it's good that the two sides are talking. But the fact that there's no deadline signals that the U.S. isn't in a hurry here to get a deal at any cost. Rather, I think it shows that the U.S. is pretty comfortable with its position, and is willing to continue the negotiations as long as it is needed to make sure that China makes the changes, the structural changes, and its economy on forced technology transfer an IP rights that the United States is seeking.</s>KOSIK: But where do -- where do talks go to now? Now that they're back on track, I mean, we saw talks get even close to a deal before, but we saw, according to the administration, China actually backtracked on the deal. How can there be -- how can you sort of hold China's feet to the fire? I get it that that tariffs are the leverage that the U.S. has over China? But is that enough leverage to keep China on track to actually when they shake hands in a deal that they actually hold to it?</s>WILLEMS: Well, I think the tariffs are a big part of the leverage. The other piece of the leverage, of course, is Huawei and as the administration clarified yesterday, big changes are not expected until a deal is effectuate and until a deal is completed. So that's going to continue to be a source of leverage. Obviously, to the extent that the U.S. can continue to work with allies and partners to pressure China that's going to help and I think if you look at the G20 readouts from the President's meeting with Japan, with India, with Germany, they all talked about needing to deal with this China stuff together. So there's a lot of ways that the administration can impose leverage. But ultimately, I think in order to get a deal, the administration is going to need to show a little bit of flexibility on the tariff issue. And China, as you pointed out, is going to need to show some flexibility on the question of how are they going change their laws to implement any of these commitments? That's going to be critical.</s>KOSIK: Okay, Clete Willems with law firm, Akin Gump. Thanks so much for your perspective today.</s>WILLEMS: Thank you.</s>KOSIK: The cartel of oil producing countries, OPEC is meeting in Vienna. It's expected to extend its agreement with Russia and other producers to cut supplies. Oil prices are rattling on reports that suggest it's a done deal. This is how Brent and WTI are trading right now. Let's go to John Defterios who is live for us in Vienna. So hello to you, first of all, you know, the market seems to be working in favor of OPEC right now. Are the tensions with Iran and Saudi Arabia around the Strait of Hormuz impacting negotiations?</s>JOHN DEFTERIOS, CNN BUSINESS EMERGING MARKETS EDITOR: I think clearly so, Alison. In fact, the meeting has started nearly two hours late because of the geopolitical tensions and the backroom deal making that often takes place trying to find a neutral party. This should be almost a slam dunk, if you will, just to renew the extension six to nine months because the oil markets working in the favor of OPEC and the non-OPEC players around $60.00 for WTI, around $66.00 for Brent. This is sweet. But you have Saudi Arabia and the UAE on one side in the Gulf and Iraq and on the other and the Strait of Hormuz bang smack in the middle. So of course this is the challenge. I asked the Iranian Minister in this context of the sanctions against him and the tensions that we see against Saudi Arabia in the UAE, what would you like to see from the meeting because there's a discussion inside right now about the future of OPEC, can it withstand this sort of tension from the U.S. and the tensions in the Gulf itself. Let's take a listen.</s>BIJAN ZANGANEH, IRANIAN PETROLEUM MINISTER: It's important for me to protect the existence of OPEC. The existence of OPEC for me is the main important thing. And in this meeting, I think we had achievement for better procedure for decision making in situ.</s>KHALID AL-FALIH, SAUDI ENERGY MINISTER: We've had wars, we've had complex differences between different countries. We keep them outside the room. We come here. We are pragmatic. We talk about supply demand balances, and how to get the oil markets to stabilize and in turn lead the global economy in the right direction.</s>DEFTERIOS: Right direction, would be of course to keep this price where we are today. Falih told me in that scrum there, they'd like to extend it for up to nine months. But how about the pain on Iran, Alison? They're looking at a loss of up to $50 billion a year due to the sanctions. So the game right now is to try to save face, try to keep OPEC together and walk away and go back to Tehran and say, "I fought the good fight." Even though their production now or the exports are around 400,000 barrels a day. This time last year, it was around three million barrels a day. So the pressure is on Iran. And also the tension that we see within the OPEC and non-OPEC deal that's two and a half years old -- Alison.</s>KOSIK: All right, CNN's John Defterios live from Vienna. Thanks so much.</s>ANNOUNCER: This is CNN Breaking News.</s>KOSIK: Okay, we want to get back to our breaking news in Hong Kong. You're looking at live pictures, where protesters have forced their way into the Legislative Council Building. They've actually smashed through metal barriers across the entrance. They've actually made it to the first and second floors. And it's hard to tell where they are right now. They look like they're in what some sort of meeting room where there's an emblem there. Not sure what they expect to accomplish inside the building. Maybe we can get more from Sherisse Pham. Is she with us now? Sherisse?</s>SHERISSE PHAM, CNN BUSINESS REPORTER: Hi, Alison. There is no clear -- sorry, Alison, go ahead.</s>KOSIK: Tell us what you're seeing there.</s>PHAM: We're just around the corner from the Legislative Council Building, as you mentioned there and we are now starting to see little bursts of violence. We are on this main thoroughfare of Hong Kong. It runs through the heart of this major financial international hub. But as you can see, this four- lane highway has been taken over by tens of thousands of protesters. Mostly in the area that we've been here -- we've been here for several hours. It's been peaceful, but they've been supporting their fellow protesters around the corner at the Legislative Council Building, at the main government building where they have broken through. They have been rushing hard hats to fellow protesters. They've been running umbrellas to fellow protesters to continue this push and we're hearing these chants of "Hong Kong, add gas," or "Add oil," which is essentially a cheer that you would say at a basketball saying, "Go Hong Kong go. Push forward. Keep on going."</s>PHAM: And the protesters here are really fighting for the future of Hong Kong. They say that the political freedoms that the semi- autonomous city has enjoyed for years are being eroded as Mainland China pushes further into Hong Kong -- Alison.</s>KOSIK: And we're watching live pictures right now of protesters spray painting an emblem that looks like it could be in one of the Council Building's meetings room. What are they trying to accomplish now that they're inside the building?</s>PHAM: A couple of mixed messages. We heard when they were trying to get into the building that they just want to be heard, that they say that the government is not listening to their demands, and by pushing into the main government building here. And just to give you a sense of what the Legislative Council is for Hong Kong, this is like -- this would be like protesters, breaking into Congress in the United States and taking over the main foyers and smashing and breaking and causing destruction and spray painting that building. That is what is happening here in Hong Kong just in the last few minutes. We've also heard reports that there are some protesters who are trying to shut down the electricity of the Legislative Council that as far as we know has not happened yet. But what they have accomplished so far is that they have broken through the barrier, because it is a national holiday today. So the glass windows were shattered. But for a very long time they were kept out by steel barriers that had been barricaded down because the complex is closed. They've been able to pry those metal gates open and pushed their way into the complex. And now, just in the last hour or so the Legislative Council is saying that all meetings that were scheduled for tomorrow have now been cancelled.</s>KOSIK: Okay, so meetings today are cancelled, meetings tomorrow cancelled. And yes, we saw the protesters there spray painting the symbol of Hong Kong. Is there any concern that all of this violence can backfire and embolden President Xi to push Carrie Lam to not compromise once things settle down?</s>PHAM: That's absolutely a fear. The one thing that has made Hong Kong such a special place is that it has acted as this middleman between Mainland China and global financial markets and global investors. But as these political freedoms are being eroded by Mainland China, the question is, is will Hong Kong lose its special status? And will China back down from all that we've seen of President Xi Jinping style of governing so far in China is that he is not the type of leader who will back down. And analysts that I was talking to say they don't care. Xi Jinping's government doesn't care if foreign firms and international business decide that this is not a place that they want to be. Xi Jinping is concerned with keeping his power intact and that could mean cracking down even further on the city here -- Alison.</s>KOSIK: Okay, Sharisse Pham live for us from Hong Kong outside the building. I want to go inside the building with Roger Clark. He is on the phone for us. He is our Hong Kong Bureau Chief, once again inside the Legislative Council Building. Joining us now live on the phone. What are you seeing, Roger?</s>CLARK (via phone): Well, the crowd inside the Legislative Building have actually gotten smaller. The protest organizers started waving people out about 10 to 15 minutes ago. So the crowd is definitely smaller and they've come down from the first floor and the second floor, although no sooner do I say that, but more people are actually starting to walk up to those higher floors. The protesters are completely in control of this ground floor and then moving through it completely. I see no sign of the police anywhere, but there's graffiti all over the walls now. The spray paint people have been out and there's some very offensive slogans written on the walls here about the Hong Kong government. Everybody I mean, everybody is wearing a hard hat, the kind of hats that you see construction workers use. They've all got goggles. Many are wearing things on their arms to protect them from pepper spray. But the protesters are completely in control of this ground floor area. And as I say, they are going up the steps again towards the first floor, the second floor as people -- they have come back into the building. They did start to funnel out again, after we had at least a thousand people in here. The tide went through exit doors when they were forced open and people poured in about 45 minutes ago.</s>CLARK: But now we find ourselves in a situation where the protest organizers are trying to get people to leave, and they did for a while. And now people are coming back in again. So it's a very sort of confusing picture here. But a very, very disturbing picture for the Hong Kong government. No question about that. They're going to look at this and be absolutely horrified to see their Legislative Council Building having been stormed by hundreds, if not nearly thousand protesters who are extremely unhappy clearly, with the way the Hong Kong government is treating them here. I'm just walking out through a security barrier, which needless to say is completely ineffectual. You're supposed to swipe your card, I think to come through the security barrier. But clearly, nobody is swiping any cards today, they're just walking around. They've got their spray cans, I can see them spraying offensive slogans on the walls. Some people actually have got some make shift riot shields. I stood next to one guy with half a suitcase and a strap inside and he is walking around with the base of the suitcase as his shield should the police decide to attack. Now, something is going on here because the cows are now rushing down the stairs. All of those people I was telling you about who were calmly walking up the stairs, they are now walking back down the stairs, and they're doing it pretty quickly. So you've got to wonder whether the police are perhaps up there somewhere.</s>CLARK: Outside or inside? Okay, so the words from that chap said -- speaking to me said to be careful and get out of the way because the police are gathering, and whether the police are gathering inside the building to push people out from the higher floors. I don't know because I can't see. But they are certainly moving down from that first floor to the ground floor pretty quickly and people are now starting to leave. Now, earlier today -- pardon?</s>CLARK: The police are up there, are they? How many? You know?</s>CLARK: Okay, thank you very much. So that chap was telling me that the police are up there and they are apparently going to start moving down, but I can't see the police officers at the moment. I can see plenty of protesters still are coming down and they are coming down pretty quickly now. So you wonder what is going on those higher floors. Some people are starting to -- people are starting to leave the building. And now I'm just seeing all of the makeshift barriers being dragged into the Legislative Building. So what I think they're going to do to protect this is they're going to get all the protesters down the stairs out of the way. Then they will put the makeshift barricades at the bottom of the stairs that as we see the police try and come down and clear people from this lobby area, they'll have some difficulty getting past these barriers - - the makeshift barriers that the protesters are carrying in. So it's all -- I mean, these protesters, I've got to say are pretty well organized once they -- once they put their minds to something, they are pretty well organized in the way that they move around with their barriers and they move around with their supplies. Today throughout the day, you've seen a huge amount of supplies coming to the Legislative Building and what happened is, you'll see a couple of family vans pull up and then the family van's door will open and water, hard hats, umbrellas, films, cling films and other supplies will be unloaded and passed along a human chain, literally thousands of people passing these supplies down the human chain to people who have been demonstrating here. So in a kind of highly disorganized way, this has been very organized, and as I speak, the lobby where I am now, it actually smells quite a lot of spray paint to be honest with you. Everywhere I look, the walls are being spray painted with offensive slogans. And now the stairs are almost completely clear, and I suspect, nearly all of the protesters have come down from those upper floor, so maybe the police are gathering there. But I have to say, this is the Hong Kong Legislative Council Building. This is the heart of the Hong Kong government. The building has been invaded by protesters and we see not one single police officer, not one single police officer is here. Now, earlier today, I saw about 500 or 600 officers who are outside the building in a different side of the building from the protesters. But I haven't seen any police officers in the last -- where are the police? Up there? So as we speak at the moment, people are leaving the upper floors, but down in the lower floors, everyone is now wearing gas masks and hard hats, so I think they are anticipating some kind of police activity in the not too distant future -- Alison.</s>KOSIK: Yes, it is amazing. You make a point that this is the heart of the government in Hong Kong where it's literally been invaded by protesters who are spray painting and you know, hanging an old Hong Kong flag from when it was under British rule that we're watching protesters rip up books near the dais where we can assume that Council Members, government officials actually sit and create law. And you haven't seen any police officers, yet thousands of people streaming into this building. Do you feel like that police are outnumbered?</s>CLARK: I mean, it's quite incredible because the protesting you see around the world, normally the police would make an area around Parliament buildings and government building sterile areas, so protect them -- and not let anyone near them, let alone storming them and smashing windows and literally pressing their noses up to the walls. I am actually just walking up the steps myself --</s>CLARK: Yes, so I'm just walking up the stairs now. Which is now pretty much deserted from protesters, one or two stragglers are in here. There are alarms going off inside the building and I am just making my way to the top of the stairs, so bear with me one second. Have you seen the police up there?</s>CLARK: Are the police up there?</s>CLARK: No police.</s>CLARK: Okay, so what we're finding out now is that the protesters who went up to the first and second floor, they realized that there wasn't a lot they could do on the first and second floors. They are now trying to direct the protesters towards a different part of the building where the Legislative Council Chamber is. So we see some escalators here, Alison, so -- Alison, we are able to see, I am coming down the escalators now where the crowds are amassing and moving. I think they are trying to find their way through this building to get to the Legislative Council Chamber, but it looks they don't quite know where it is or how to get there. But this is a very, very serious situation, no question about that. The Hong Kong Government Legislative Council has been invaded by protesters. It's been vandalized and they are very much in control of this part of the building. And no sign of any police officers anywhere -- Alison.</s>KOSIK: Yes. So the Legislative Council Chambers is what we actually are seeing on our TV screens right now. We see protesters moving chairs and spray painting the chamber. So I would say dozens and dozens of protesters had made their way to the chambers. And they are literally ransacking the chambers. And as you said, there is no sign of police. Do you get the feeling that police are just waiting this out at this point, they're just waiting for this to sort of finish?</s>CLARK: Well, I don't know what their tactic is, to be quite perfectly frank and I suspect when all of this over, there will be a full scale review of their tactic because protesters would not have been able to get into this building, and I can't believe it. If this is a police tactic, it's a very strange tactic I have to say. But it was very unusual for the police to allow protesters to get so close to this building in the first place. Now what the protesters are doing is building a whole bunch of barricade and using plastic slides, you know, the plastic strips, the zip ties to tie these things together. These are crowd control barriers, and they're being used by the protesters in Hong Kong to effectively blockade this part of the building to make it very difficult for the police to actually clear it. Now, as I speak, more and more people are pouring in and I think they're trying to make their way to the Council Chamber. But it is pretty chaotic in here. In fact, one of the protesters just don't know where the Council Chamber is, they suddenly went up to those higher floors and found that those higher floors didn't really take them anywhere. Now the barriers, these barricades were in the shape of a triangle. They use barricades like this to try and crash their way through and now they are using the barricades to effectively prevent the police from coming in and clearing them at some point. And as I said, the walls are now covered in graffiti, there are people shouting on megaphones. It really is an utterly, utterly shambolic and very, very worrying situation on the ground here with the Hong Kong Police having done nothing in the last 45 minutes or so to try and retake control of this part of the Legislative Council Building.</s>CLARK: But you've got to understand, Alison, that here in Hong Kong, passions run very, very high. People here, they are not just protesting about services or taxes or anything like that, they are protesting because they fear their fundamental human rights are being eroded. These were human rights guaranteed 20 years ago when the British government and the Chinese government signed a treaty which would guarantee the way of life and the laws of the Hong Kong people and the Hong Kong people here, most of them here, they claim -- they feel that the Hong Kong government and the Chinese are nipping away those --</s>KOSIK: All right, Roger Clark, thank you so much for your great reporting. We will stay on these pictures and stay on this story right here on CNN. This has been FIRST MOVE. Stay with CNN for the latest with what's going on in Hong Kong.