Good morning from Keira in Sydney! Here’s all the top news from this morning...

Today’s must-reads:
• Conservative governments weigh Trump ties
• NAB earnings higher than expected 
• Wisetech’s Richard White pledges  better oversight

What's happening now

Australia’s main center-right opposition party is reeling from a landslide election defeat and grappling with an issue that has perplexed conservative movements across the world since 2016 — whether to embrace or distance itself from US President Donald Trump.

National Australia Bank’s earnings topped analyst expectations in the first half of the year as the firm’s key unit of lending to businesses grew. Cash profit rose 1% to A$3.58 billion in the six months ended March 31

WiseTech Global Executive Chairman Richard White returned to the public stage with a vigorous pledge to improve corporate oversight, a little more than two months after he reasserted his control of the scandal-plagued company in a boardroom cleanout.

Australian Prime Minister Anthony Albanese won a historic re-election on the promise of bolstering the economy, addressing the cost of living crisis, and tax cuts. Australian Chamber of Commerce and Industry CEO Andrew McKellar discusses the outlook for Australian businesses and the impact of Trump's tariff war on "Bloomberg: The Asia Trade." Bloomberg

Australia’s pension funds should consider investing more in local-currency credit products as the greenback’s recent decline may pose risks to their expanding overseas portfolios, according to the head of investment strategy at Challenger Investment Management.

Australia’s household spending unexpectedly declined in March, snapping five months of increases as the impact of a major storm in the nation’s northeast disrupted activity. “Queensland saw a 1.3% fall in spending, as ex-tropical cyclone Alfred impacted parts of the state,” Robert Ewing, ABS head of business statistics, said in a statement. 

Macquarie Group Chief Executive Officer Shemara Wikramanayake said Australia’s economy is looking resilient and is set up well to withstand the shocks emanating from US trade policy. Meanwhile, Australia’s sovereign wealth fund is preparing for higher inflation and bond yields for “an extended period” amid simmering global uncertainty.

Regal Partners co-founder Phil King says he’s learned from mistakes made in the firm’s Opthea investment that went awry. King was forced to revalue a more than A$200 million stake in Opthea to zero after an eye treatment trial failed.

What happened overnight

Here’s what my colleague, market strategist Mike “Willo” Wilson says happened while we were sleeping…

Stocks eased and the dollar fell on the news that the European Union plans additional tariffs on about €100 billion in US goods. Sentiment was hit again as President Trump said that tariffs would be set by him and not be a function of negotiation between the US and its trade partners. This sapped risk appetite and saw money flow into Treasuries where yields closed lower, weakening the greenback and helping Aussie and kiwi to a third day of gains. Today’s NZ jobs data is a placeholder to the Federal Reserve’s interest rate decision later on. Here, focus will be on how strongly chair Powell stares down Trump in not cutting rates, a position that is sure to cause volatility from Wall Street to Washington.

It's easy to be direct with an adversary — far less so with an ally. Australia's new government faces a greater strategic challenge from Washington than from Beijing. US foreign policy has become increasingly unpredictable, just as China is growing more forceful, writes Bloomberg Opinion’s Karishma Vaswani. 

India said it conducted military strikes against “terrorist camps” in Pakistan, an expected move after it pledged retaliation for a militant attack last month in Kashmir that killed 26 people.

US President Donald Trump said he would prescribe tariff levels and trade concessions for partners looking to avoid higher duties, appearing to move away from the idea that he would engage in back-and-forth negotiations.

The opposition Liberal-National Coalition's leader, Peter Dutton, proposed a plan to replace the government's renewables-focused climate targets with a switch to nuclear energy. Although he lost the election, it wasn’t because of his nuclear ambitions, writes Bloomberg Opinion’s David Fickling. 

Friedrich Merz secured parliamentary backing as Germany’s new chancellor on the second attempt, paving the way for the conservative leader, finally, to take charge of Europe’s biggest economy but with his authority considerably diminished.

What to watch

• RBNZ Publishes Financial Stability Report
• New Zealand unemployment rate, wages, average hourly earnings
• Australian April foreign reserves

One more thing...

Australian Prime Minister Anthony Albanese's historic re-election win came with promises to tackle a housing crisis that's made the nation's property some of the most expensive in the world. Bloomberg's Haidi Stroud-Watts explains why some economists remain skeptical of any quick fix to a complex problem.