Sydney, 9 00 a. M. In hong kong. We have the polls and alabama, covering ahead of the special montgomery ahead of the special election. We will talk about the chinese appetite for u. S. Debt. This chart plays into how things have changed in terms of this debt binge on u. S. Treasuries china has had over the past decade, doubling its hold over u. S. Treasuries. That is starting to resolve because of a steady currency. You can see this conference relationship between where the dollaryen Exchange Rate is, and the levels of chinese treasury holdings. We have seen this fading of appetite for holdings at an inopportune time, when you have a plan republicans want to push through already adding to a ballooning deficit for the u. S. We have a situation where china owns more than 2. 2 trillion in any u. S. Government debt, and any selling of that could have ramifications. Wells fargo Holding Stable along that 6. 2 level. Very interesting implications for u. S. Treasuries, especially as we get the fed tapering on its side. Malaysia just coming on. We had a pretty sanguine session when it came to the u. S. That is not really translating to green in asia. David no, not at all. There are fairly acute risks. Polls closing in alabama that is one thing. We talk about the slimming republican majority also at risk. You have the fed, jobs data coming out of australia. Tomorrow you have inflation data. Inflation out of the u. K. , inflation out ofwe talk about it is playing out across bond markets. Have a look at the futures rise. Keep an eye on this 26. 65 is your level right now. Have a look at the breakdown across equity markets. A lot of this comes down to the japanese banks. I had of the the decision, do we get a slightly steeper yield curve . India, this is the problem. This market opens up 2. 5 hours from now. We had inflation surging to a 15 month high yesterday. Food prices on the up. That becomes a problem when youre stock price it when your stock market is as pricey as it is. Also there is some concern over deficit. Ing fiscal you that altogether, it is hard to imagine how valuations can stay at these levels. Although people are bullish in you have seen inflation, in a big way. Last week we were talking about the rbi cutting, now a rate hike in the cards. Very quickly looking at hong kong futures at the moment, do wn 40 points. Massive drop yesterday in this market. Let me give you a sense of how the close was yesterday. 1 drop. Financials leading those declines. Life,he insurers china 3 , 4 drop. We will see how that plays with markets here in about 25 minutes from now. Haidi absolutely. Wants to watch out for. A lot of Global Factors at play when it comes to asian markets. News get the first word from new york. Ramy first to japan, and more evidence of a strengthening recovery. Machine news from new york. Orders for octobers smashed expectations, a rise of been when the estimate had for a fall. Borders rose 5 , nearly twice the forecasted 2. 9 . Other data signaled a slow but steady improvement in the economy. Indias inflation rate beat the borders rose target, prompting concerns that prices will rise faster than expected. Prices risen by more expensive food as well target, prompting concerns as fuel. That is the fastest face in 15 months. Bravo bank now expects a rate rise by the Second Quarter of next year. The eu chief brexit negotiator warns the u. K. Of going back on agreements it may last week, as concern grows that the two sides are in a race against time. Michelle barniermichelle barnieu will accept no backtracking from london, after other u. K. Politicians questioned the accord. Of the airbus may have to find a brandnew leader, with its ceo reportedly declining to stay for a third term. It is accord. Airbus may have to find reported expires in mandate may 2019. Expires in may 2019. The board will endorse the decision thursday. His position has been strained over a bribery investigation. He cautioned employees that the outcome might be painful. Global news 24 hours a day powered by 2700 analysts and journalists in 120 countries. This is bloomberg. Haidi lets take a look at how futures markets in the u. S. Are shaping up as polls closing in alabama. We did see a pretty calm, of theh session ahead s p hitting another record high. Futures showing stimulative downside, less than 110 . Less than 1 10 of 1 . Dollar index hitting the highest in a month. Polls have just closed in alabama at a special Senate Election that will have white rate have wide range ramifications. Our bloomberg correspondent joins us from the capital of montgomery. What do we know so far . I am here inside roy moores headquarters, where polls have just closed the state of alabama. The results will begin to trickle in between roy moore, republican, and doug jones, his democratic challenger. I can tell you that the emcee of tonight they hope it will be of political victory already the fallout from these allegations which roy moore denies still reverberating throughout washington. Senator luther strange, a republican and alabama politician that several have a replacement for roy moore, declining to say who he voted for. There are some activists that moore moore win,y that the senate in washington d c should expel him and another republican appointed him. The names that comes up is luther strange. Haidi regardless of the various outcomes, not having a democrat sent to the senate in a quarter of a century for this seat would be one scenario. Get ams if we do republican winner, it would not necessarily make things easy for them. The magic number in the senate is two, the number of votes in the Republican Party that President Trump can afford to lose to keep his agenda items on cap. We saw that with health care, now quickly following it with tax reform. If the president wants infrastructure and regulatory doddfrank legislation passed, that matters too. Two ug jones wins, that becomes one. That is why republicans in the state are suggesting they are not voting for roy moore, they are voting President Trumps agenda items. These this special election has come to represent so much a special just election in alabama. That said, exit polls suggest that the majority of votersa spl election in alabama. See these allegations playing little to no impact on who they decided to vote for. Haidi almost seen as a proxy. Extraordinary election in what has been an extraordinary year. We will get back to kevin cirilli, our see chief washington correspondent in montgomery, alabama, as polls have closed in the last few minutes. We are waiting for indications of the results as counting proceeds. One of our top stories we have been following. Toshiba and Western Digital ending a lengthy legal dispute that has threatened to derail the 18 billion sale of the flash memory chip business. That was a deal struck with the Consortium Led by bain capital. Lets get it over to our bloomberg missed bloomberg columnist. This is the light at the end of the tunnel, finally. It is. It seems to be Western Digital playing the long game. They have sued toshiba, because toshiba was looking to jump into bed with someone else in the memory chip business. They did not stop toshiba from going ahead with that. They sold to a consortium of bain and others. The final resolution seems to be a win for Western Digital. Western digital gets what they were aiming for anyway, and that is access to future chips being made by toshiba. Specifically, they get access to the factories toshiba is planning to build Going Forward. They basically said in october they are planning to go ahead with factories for new flash memory chips, and were not do it withanyone else, i. E. Not Western Digital. Now Western Digital is in on those plans, and they get to benefit from that. Haidi with western is this a clean resolution to all of the acrimony, so toshiba can wrap up this deal . I dont know if it is clean so much as it allows them to close that chapter in this saga. I still suspect that the final spin off of the i dont know ifs mike go ahead. I dont have any information, so dont go ahead and trade on that information. Suspicion thatng wont go as announced. Markets to get money from elsewhere. Suspicion that wont go as announced. They dont necessarily need the money anymore. Toshiba has gone to capital they may be able to hold onto anyway. Business i have suspicions about what would happen in the next few years, in that even if this spin off those go ahead, they will end up owning it again in a few years anyway. Haidi tim, always a skeptic. Maybe another chapter yet in this drama between toshiba and Western Digital. Can opec help oil sustained the recent price highs . We will speak exclusively to the general fr beijingom. How many hikes do we expect from the fed in 2018 . This is bloomberg. Haidi a quick check of the latest business headlines. Indias richest man is considering an ipo of his mobile operation after a billiondollar investment spree that shook up the market. We are told he is holding internal talks about listing infocom in late 2019. Jio has not made a promise since late last year, but holmes to hoax to aim its performance. Dragging last cap shares by the clintons. Air china falling 5. 5 . Dragging lastchina eastern not r behind. Rising oil prices were blamed for the decline, although the three carriers have climbed more than 10 in the last month. Facebook is changing its structure to pay taxes in the country where sales are made, rather than routing everything through its irish subsidiary. Khamenei has been under pressure the company has been under pressure after sparking public in 2014. L prices wereanger in s the u. S. Federal reserve has convened for its final meeting of the year, likely Janet Yellens swansong. Markets are operating are awaiting the rate hike. Joining us is executive director of Peak Asset Management in melbourne. What are we watching . Short of anything unexpected happening, we are going to get that hike. For next year plot that really matters . Maybe she will Say Something about bitcoin, given what the rba is saying. We have seen the pmi at 54. 7 , u. S. Gdp slightly above expectations. Unemployment at 4. 1 . Retail sales picking up towards christmas. W expecte the fed to increase Interest Rates. We expect to see that in january or february next year. Risk what is the biggest that they will move too quickly, or that they will fall behind, given that we have Inflationary Pressure from this tax passage, if it gests through . Niv u. S. Corporate taxes will fall to 20 , and that will have a strong inflammatory impact on the market. You have seen the macroeconomic numbers also. We will see some Downside Risk as the s p reaches for time highs, 20 times forward earnings. The risk will be to the downside in the nearterm. Haidi so much of what we have seen in markets over the past few years has been a liquidity driven story. Everyone talks about this goldilocks story, where inflation is not materially is not materializing enough for banks to move hawkish leak enough. Is that indication that things have to come down soon . Niv we have seen the bank of england raise rates in the first time in 10 years. Global markets are sitting at record highs. It is a bit of that goldilocks, as you mentioned. Expect the u. S. Fed to raise three or twice or three times in 2018. We are watching the u. S. Dollar commodities, and as you mentioned, bitcoin very closely. We have been paying unusual amounts of attention to what is going on in alabama, with polls closing of the top of the hour. How much of a moving event is that going to be, given that it has enormous implications for the balance of power in the senate . Niv the balance of power is very important, especially we hg withal amounts of trump pushing his case for Corporate Tax cuts, Health Reforms as well. Moore is obviously the key candidate we see coming through. There has been a fighting effect in terms of the two leaders. Those reforms are crucial for the next year. Haidi stay with us niv, lots to talk about. Executive director at Peak Asset Management in melbourne. For now, we want to turn to bloomberg, our interactive tv function. He will not only be able to catch us live, but catch previous interviews and do a deep dive to any of the securities or functions we talk about. You can become part of the conversation as well. Send us messages during our shows. This is for bloomberg subscribers only. Check it out at tv. Haidi we are counting down to the open of markets in china and in hong kong. We are just minutes away now. Take a look at our Hong Kong Market session. Flat. S looking relatively lets go back to our guest to talk about expectations going into 2018, after what has been an extraordinary year for emerging markets, asian equities in particular. Niv, let me start off on china. Themes one of the key coming late in the year is the starting of falling over of the china. Onary seen in scene in china. Scene in china. Producer and Consumer Prices starting to fall. Is this something policymakers not paying enough attention to going into next year . Niv absolutely. We saw the chinese cpi figure out. 7 . At 1. 7 . Niv gdp still expected to be ard 6. 5 . We still expected of a slowdown from the ygdp still expected tos well. It comes down to the central bank will they or wont today haidi when it comes to Australian Investors and the aussie dollar, we have this unexplainable bounce in the dollar. Some of it has been attributed to the crossborder m a, but some are pretty bearish when it comes to the aussie. Niv we have seen j. P. Morgan and Goldman Sachs saying Commodity Prices will rise. I think it is a twosided story, cobalt and lithium versus other metals. We are probably in the same boat. We believe there will be a supply issue in cobalt and lithium as electric vehicles pick up. The Australian Dollar is tied closely to Commodity Prices, if you believe chinese growth will strengthen as prices fall, and the u. S. Market moves higher on the back of those tax cuts. We will probably see some upside in the aussie dollar rather than a fall. Haidi it is not just watching the fed. The fed might be the most predictable. In terms of the ebc, we have this dovish hike. Is next year still going to be a convergence when it comes to central bank, or will it be that divide emerging . Niv we think there will be a slight the virgins in the nearterm. Slight divergence in the nearterm. That will be a two speed economy. We saw the bank of england increase Interest Rates in the first time in 10 years. We are seeing indias Inflationary Pressures at a record high. We do see the Australian Dollar picking up as Interest Rates increase by 25 to 50 basis points next rba. Inevitably i was going to ask you about bitcoin. What is your take, given we have had this milestone moment with futures . Niv the rba just this week said it was a speculative mania at the moment with bitcoin. We have seen global Central Banks strongly against the bitcoin rise. Volatilities starting to pick up. What could happen is kudos right now. Who knows right now. We will probably see a Downside Risk in the nearterm. Haidi pleasure to have you, executive director of Asset Management joining us in number. A lot of ground covered in the conversation. Markets in shanghai get underway. A little bit of a nervous market at the moment. Plenty more to come. This is bloomberg. Is this a phone . Or a little internet machine . [ phone rings ] it makes you wonder. Shouldnt we get our phones and internet from the same company . Thats why Xfinity Mobile comes with your internet. You get up to 5 lines of talk and text at no extra cost. So all you pay for is data. Choose by the gig or unlimited. And ask how to get a 200 prepaid card when you buy any new samsung device with Xfinity Mobile. A new kind of network designed to save you money. Click, call or visit today. Nine 20 9 a. M. In hong kong. A mixed market when it comes to asia. The course of the session, going into voting and that special Senate Election in alabama where polls closed about hour ago. The result. Ng going into that it looked like it was going down to the wire. The balance of power for the republicans. Here in asia, lots of moving factors. Thans coming in better expected. Aussie Consumer Sentiment better than expected. Lets get it over to david. David very dull. The colors on our market map tell it all. We are looking too much of the Pacific Ocean here. Higher. H of 1 steep coming up some declines on tuesday. If you put everything together we are not getting that much convention. That was just pointing out we are coming out of the alabama election. Coming from the u. K. And from asia. Later tonight, the u. S. Comes out with its u. S. With its inflation rate as well. So far, the one you want to watch is right here. 7 10 of 1 drop. Rockets the 15 month high. It cannot be good for the market. Me refresh this. Look at offshore. Your split. Split in between. Coming off the high of the first few minutes. Icbc bleeding. Icbc leading in the games. Were not getting a lot of movement as far as individual stocks are concerned. We do have an overlap of a lot of constituents. There is your broader read across the main inch mark in hong kong. Real estate is down a quarter of one percent. This is down to one of the first one of the bigger stocks. Aat technology down. This should be that stock. Lets have a look. Tencent is up a quarter well, half of 1 . This is a split. Slightly below six extreme. Below 662. Lets give this more time. What id you want to mention is n you look at mma goes this is our function to get a sense of which where the money is going. The past few sessions or so have seen a drying up in the amount of money coming from shenzhen into hong kong. This is your daily balance. You are coming off 10. 5 billion every day. Look at that. Day starting point is the same every day. The more the line goes down, the more the quarter gets used. Say, 25 days back, we are not getting that much used up when it comes to the quotas. This chart also speaks to how reliant markets here in hong kong are from money coming from the chinese mainland. Picking up a lot of chinese stock listed here. Insurance. Ng an every now and then you do get a trend. Broadly speaking, markets today are not very exciting. A lot of risk ahead over the next 24 hours. A bit lukewarm as you say. Give it a little time to warm up. Uptodate with first word news. India and its inflation rate zoomed past the target. Interest rates will now rise earlier than expected. Consumer prices jumped 4. 9 . Driven by more expensive food and fuel. It is the fastest pace in 15 months. Rob a bank now expects a rate rise. The chief eu brexit investigator is warning against going back on agreements may just last week. Michel barnier says they will accept no backtracking from london. This is after questioning legality of last fridays accord. The bank of england governor is under pressure to justify policy as inflation unexpectedly accelerated to its fastest pace in more than five years. November 3. 1 rate is the highest since march of 2012. It is being driven by the cost of air fares and the cost of computer games. It is more than one full percentage point above the banks 2 target. Westfield mall owner jumped the most in three years after a takeover by unit built. The landlord ildsit will cut unib rating one point. We feel the deal properly values the company. For that reason, we think it makes a lot of sense to accept the offer in record men that and recommend that to our shareholders. The combined group will be the worlds best Shopping Center company. The ever struggling noble group is now gaining the most since july after selling a coal asset in the United States after it talks about restructuring. Involved suchkong a proposal from creditors after restructuring 3. 5 billion of debt. Aat swap could you race significant part of the holdings of current investigators. Global news, 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. Inocencio this is bloomberg. Haidi thank you so much for that. We are watching the fed. Y have had their final meeting of the year. Asian Central Banks looking to start and policy but facing myriad challenges. Economics editor Kathleen Hays and Malcolm Scott to set the stage for some 15 centralbank decisions. Are the market looking at given that the hike is so widely priced in . Is holding ae fed two day meeting on tuesday going into wednesday. It is the final meeting of 2017. It is the last conference that janet yellen will preside as chair because she will be stepping down by february. All of these things makes this an interesting meeting. They are expected to raise the key rate. On the far left hand side, there is 100 chance that if the fed. 5 basis points, it will be fully discounted after , low onong jobs numbers employment, and many fed officials saying we are on the path of normalization and suggesting they are on board with a december hike. But the surprise comes from the steps. Seps. M the wherehat each member says i see the economy going, here is where i think Interest Rates will go in the months ahead. And now this is where the drama is. 2, 3, or four hikes. D. O. T. S. The 2017 consensus is a long line. By the second half of the year, economists got on board with what the fed had forecasted. It is less of a consensus now. Said they seethey three rate hikes in 2018. You can see how widely spread that is. Is it possible that this meeting more of those dots will move up higher . They might move to the for rate hikes that jpmorgan has said. Its possible a more dovish view may prevail. Even consensus could drop to two. Thats where were going to be listening to janet yellen at the press conference. As she departs from the fed, she is a strong later. Portraysee how she that consensus as 2017 turns into 2018. Haidi maybe a bit of nervousness in terms of clearly a Different Communications dial from the new chair. I want to bring in malcolm because, where the fed goes, asian Central Banks will be watching closely. We are a far way out from the days of the paper tantrum in this part of the world, but what would they be hoping to hear from janet yellen . Importantots are all right here in asia as well. So far asia has not has managed to largely ignore what the fed has said. Next year it will be a different matter. We have seen the tightening cycle come to asia already. Last month when korea increased increasedes Interest Rates for the first time in several years. If we get two or three or four from the fed, that starts to matter for some of the countries that rely on imported capital. The philippines, and elsewhere. Places where there is a current deficit and a budget deficit. They rely on foreign money coming through. Asthat yield advantage it starts to erode, the money will dry up as well. All of a sudden there is talk of decoupling which may swing to talk of recovering. Haidi here in asia, just as an example we see the impact of dutertes. Are we thinking the fed is looking at what fiscal stimulus by way of this package of tax cuts comes through . At the beginning of 2017 some officials added eight bit added a bit onto the gdp. That pulled back because those plans did not get anywhere. Now i think of it as being cautious. It is far too early for this to affect any policy decisions they make now. Thehe last couple of weeks, Small Business optimism survey a quarter billion members they have the biggest jump in optimism since 1986. Clearly, it can be in part of low unemployment, more orders coming in, and the fact tax cuts look like they will come through. It seems to once again excited business optimism. Thats the tangible in agreement. Thats the tangible ingredient. I think it is hard to model where that is going. It could be a plus. Haidi malcolm, we are talking sayings low and he was the fed, janet yellen, should be looking outside the scope of Economic Activity and forecasting. They should be looking at what happens in asia. They are not. What are the dangers in terms of what is happening in china with the economy. It may start to turn a bit with inflation numbers. Also with expectations on how the pboc will react. We saw that story yesterday about the contingency plans for additional four officials in china. Authorities there are aware that this stability nuance and the related stability and outflows all hinge very much on what the bed and the u. S. Economy does as well. They are standing by ready for action. Uld they need to prop should they need to jump in. They are ready to act. They have managed to put a floor under all of these issues this year quite successfully. The difference between now and at the start of the year, where the pboc followed the fed just hours later by increasing its own rates on reverse repos. It is the yield spread at the tenure part of the curve. Its about a hundred and 60 basis points. It was under 100 basis points back then. We do not expect the pboc will do anything in reaction to the feds raise this week. ,aidi thank you so much Malcolm Scott there in tokyo. And Kathleen Hays in new york. Waiting for the fed decision. Coming up, leaving in bitcoin. Why the cryptocurrency will sign brighter than even goes. This is bloomberg. Two people riding high on the current that coin current bitcoin wave. The stake is valued at more than 1 billion. Why they are backing bitcoin. We think bitcoin is like gold 2. 0. Whatever your reasons are for investing in gold, we think that incoin matches or beats gold all those categories. Youcan send it around like send an email. Its a lot harder to do that with gold. Is 300ket cap right now billion. The market cap of gold is 6 trillion. Disruptsif bitcoin gold. We have been saying this for a wild. Wethink there is a chance will be 20 times more correct from here on out. Sure. Ossible, for anyone who likes the characteristic of gold in their portfolio definitely will be attracted to bitcoin. Just curry had a note out talking about that. From his research on the flipside is because etfs have not seen outflow of gold. They look at a different type of supply and demand. So you said you could be 20 times more correct than you are right now. So you are saying there could be a 30 fold increase. How do you get there . Even people who are positive on could see athat we sharp correction and that it might go back up. It could be a rocky road to get there. Part of that is creating access to it. We built gemini. Com we launched two years ago. Arere launched we headquartered in new york. We have some of the worlds most sophisticated market makers. Phase two is creating a futures contract. A Bitcoin Futures contract is cash shuttled. Institutions already trading in chicago exchanges can get cashure to bitcoin with and settle out in cash. So they do not have to touch or feel bitcoin and they get the exposure to it. The next phase of that would be Something Like an etp etf product. Introduced. Guys had you had a filing with the fcc. They pushed it back to you. Are you planning to refile . We are in process. We do not have to refile. We are on appeal. This approval ruling is a field right now. We are waiting to be heard by the commissioners. What is the next step with the cme. Differently, as i understand. It will be priced from a combination of different prices. With thentract settled gemini auction. We think it is simple and easy and and arbitrage. There are settles on a blended index. It is a different flavor. But we welcome more products and more price discovery in this market. Haidi that was the gemini cofounders tyler and cameron wuinklevoss. We will take a closer look at the implication for investors next. This is bloomberg. Haidi lets check in on one stock that is definitely moving and outperforming the rest of the pack. Westfield, the Department Store or mall chain i should say. Before todays rally it was down about 10 for the year. And bow. The rating of europes largest commercial landlord. For agreed to buy westfield 3. 8 billion. Lets talk about the ramifications of this deal. This strikes me of the seeing a bigger deal when it comes to the u. S. Because they get so much of their business there. Yes about 70 of their revenue comes from the u. S. Where you want to go look at items before you touch them or spend money on them. This is definitely seems like thats what unibailrodamco is going after. Is this part of a strategic shift . Little bit. On a is this part of his plan for the empire . He did say yesterday out that he was hanging up the gloves at as far as retail is going. Very recently, he is 87 years old. The other thing to keep track up is the stock was down about 10 so far this year. That would have been thats the worst performance on a yearly basis in about five years. We have seen that in mall stock across the world. We have issues with steinhardt in south africa. Possible mergers going on in the u. S. There is definitely the argument to be made that the price they are getting which is a valued at about 10 aussie dollars per share is not a bad price because the stock is not been at that level in about a year. Haidi it struck me as an odd time to do such a deal is here in australia we are talking about amazon arriving into what is a leaker did environment. In the u. S. ,siness where it is already dominated by amazon and the ecommerce space. What are the buyers getting out of it . I think what is happening here and we are seeing westfield is a leader in this. Malls are not just shopping is not the only thing. You go there to watch a movie, to catch dinner, that kind of thing. It is becoming an entertainment hub. Miami, whereuch they are putting in hotels in the malls because these are prime locations. Like the one we have here in sydney. It is prime real estate. , i betl estate alone there are a lot of people who would be happy to own the real estate. Biggest real estate deal since 2013. For australia it is and how indication of it is a health indication. We have had a couple smaller merges here in the local market. Anz this week. Maybe the bankers here are wrapping up before christmas. I doubt we will get more m a next week. Haidi it seems to be helping the aussie dollar. Here in sydney, talking about the mega sale of westfield mall operations to that french buyer. Hunting more to come on the next hour of Bloomberg Markets asia. We are continuing to watch alabama, hopefully getting those results from the special Senate Election there. As is bloomberg. Headlines, as we start the Asian Pacific trading. To call astoo close the race goes right down to the wire. We will be live in montgomery. Haidi youre watching Bloomberg Markets asia the second hour. One of the biggest surprises has been the resurgence of the indian inflation. Biggest and fastest pace of gains in the last month. Been the runaway Success Story in the three years since they have had their Prime Minister at the helm. Indian stocks are at the priciest in asia. Is this sustainable . Politics could come into play. No shocks on the horizon but the trigger could be politics if we see any sort of upset when it comes to the state votes that are coming in later this month. Only cause for a rough landing that he sees, it suggests that we could see a further run yet for indian stocks. Lets take a look at the rest of asia. It has been a pretty subdued session. A positive out the you. But it ready sluggish session. Politics sent front and center in alabama. Me to give you some time to get the markets warmup, dave. Is it still a bit lukewarm . Were still stretching. There is not a lot of color to our lives here. Indonesia is getting underway very much gray. Trading sideways. Im watching for this market. Thats the close in india yesterday. Are of these markets here shut. You have to wait for the sun to rise this way. Markets will be opening up in the next two or three hours. Inflation is very much in focus when you talk at india. Here is your equity benchmark. Call it futures for forex. India. On out of inflation of the u. K. Yesterday. A lot of key catalyst perhaps. Its already playing out. Crude is up 9 10 of 1 . A dollar 50. About the last two weeks or so have seen a loss in momentum for equity markets in asia. We revisit this chart. We get a sense of whether or not the market is about to turn. Below the subng level of 40. It has bounced back quite nicely. , because thell last time it fell below 40 was back in 2015. It is very much still in focus. Bonds rebounded from the 50 day moving average. A lot of the risk ahead comes town comes down to the fed. Get about the meeting forget about the meeting later on because we are ready know what is going to happen. Over the treasury yield the fed funds rate. The reason we have these red lines, that demarcates where the end of the cycle one. Going back to the late 80s, but we noticed was this was flagged by ben emmons. The spread at the end or the peak of the cycle is at about 75 to 100 basis points. We are currently at about 60. We have picked up. The average is about 40. Does that mean were nearing the end . It is one of the conditions. It is not everything. For fourone is calling or five, fed funds futures are calling for only two. David, thank you so much. Watching and waiting of course. A lot at play. A lot of uncertainty in the session. Lets get to first word news. First to japan. More evidence today of a strengthening economic recovery. Machine orders for the month a 2. 3 . 5 . H on month orders rose nearly twice the forecast of 2. 9 . Slow but steady improvement in the economy. Toshiba has settled its dispute with Western Digital. The official announcement is expected at any time. A deal would see both sides dropping their cases. Western would also be allowed to invest in a new hightech last memory plant and receive guaranteed supply of chips. The market says the putting a floor on oil. Brent should raise between high 50s and 60s dollar her barrel. The top end of the range could see the u. S. At 900,000 barrels a day of shale output. We see things in the high 50s to high 60s range which seems to us to be the most reasonable outlook right now. I think there is more uncertainty. A big . Question mark hangs over venezuela. Figaro well quit airbus in 2019. A bribery investigation. The outcome might be painful. Global news global news, 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. Im stephen engle, this is bloomberg. Haidi steve, thanks for that. Ofare awaiting the outcome the fed. With the exception of the folks on indian bonds. Here in sydney, lets talk about the lack of volatility. What are the implications, put aside the fed for a moment but of alabama. Alabama could cause a bit of a lip. A he were to lose out to democrat, that makes the apublican task making it comprehensible and digestible bill much harder. So, that means more compromises and more rush, more ad hoc. We would see markets pull back a little bit on that. The s p 500 futures would dip. Treasury yields would dip with them as well. Then people would vote for the fed, this is bloomberg. This is bloomberg. Even though we are so close to christmas. Sensible real lack of new drivers to change the patent. We still get a lot of surprises in the new year. Is in their patent, they have their positions they are sticking with their rockets. Along comes the new year, new asset allocations, new strategy outlook. It is a claims great it is a clean slate. Haidi we could get a surprise of india . Yes and no. And whenated big role i first saw the headline, i thought it was something else. It might be taken with a grain of salt . Up prettys have gone high. I dont think we will see a pullback. You wont see the sticker shock that you might have expected. Haidi at a hike . Done deal . Very difficult to work out with india. Plenty of political pressure. They are going to ramp up. Facing a difficult political situation Going Forward and for the polls. Its been about two weeks almost . Indicating it might not be as easy for his party as they had thought. It will be a tricky never gauge and for the r. B. I. So i wouldnt say it is a done deal, but it is certainly not going to get any sort of easing talking about how they are finished. Haidi garfield, thank you so much. You can follow more on this story on our markets live blog. Lets take a closer look now at the fed tightening. How that could play out across asian economies. They have traditionally been pretty vulnerable my comes to fed tapering. The philippines and indonesians deciding on rates tomorrow. Edward, this is a interesting that meeting, right . The move itself is so widely priced in. Were looking at Closing Remarks from janet yellen. What would Southeast Asia markets be hoping to get out of any sort of statement . The big uncertainty is the outlook. The. Parts as you say. Say. E dot parts as you does it lead to stronger growth or stronger growth and high yields, or does it just lead to high yields . The highyield story would be bad news for asia at the margin. The higher gross story would be better news. Ubs we have been arguing at is as long as the rise in yields is not too much, asias and not too bad of a state to cope with it. Credit growth is more modest. The economies are more of a less fragile position now than they were three or four years ago. Haidi what are the implications inentially we have seen that general report that china is already making steps to react to the u. S. Tax reform package if it goes through. Are there consequences that you can see immediately for some of the asian economy . Consequences that matter in the shortterm our what it does for growth. What it does to yields. The economy is more vulnerable than others, we tend to think philippines, it indonesia, malaysia. Their benefit from the carry trade. Highyield would make that carry trade money change direction. That would be the most incremental impact. The other question is on the extent to which the u. S. Becomes more competitive with regards to tax rates. The structural pressure in asia is for tax to go up rather than welfarepay for more payments across the economy. It is the aging economy. Some we will dip into footage we have of the sg holdings ipo. Taking a look at that now this is the ceremonial aspect of this ipo. First lets take a look. These are live pictures. This is the ceremony of sg tokyogs debut on the stock exchange. We are seeing stocks broadly across japan and asia little changed. We are in a Holding Pattern ahead of the fed, ahead of the acb, and ahead of the indication of the result of that special investigation in alabama. Crude up this hour, a creeping back up. Stocks decline. We will get the views of jpmorgan, scott darling. Also getting the outlook when it comes to the dollar. This is bloomberg. [applause] haidi there you have it, the ringing of the long for smg holdings. Making its ipo. Jumping as much as 20 in their trading debut. This is the second largest are sold Delivery Company in japan. This is the biggest ipo this year. ¥1900. G at ¥1620 trading at about 15 and a half percent above the ipo price. The gong was just struck. We are seeing this kind of resounding optimism over Solid Earnings helped along by a logistics in particular when it comes to japan and abroad. A lot of exuberance there. Lets go to eight quick check of the lets go to to a quick check. Shares after the stock fell about a third from its peak. 24 officials in clued in the current chairman will by 13 hailion worth of boy shares. Being ichest land is indias richest man is considering. Holding and terminal talks about shares. Jio he has not made a profit since last year. Is changing its structure to pay taxes and a country where sales are made rather than routing everything through its irish subsidiary. They have been under immense pressure that its practices. Last year they routed u. K. s sales through ireland. In 2014 it only paid 6 billion in british taxes. Where now rejoined by edward tether. Edward, sorry to leave view all view all of the leave amidst all of the celebrations. About the record trade deficit the came through for the philippines in october. Is this a normal indicator to get given that you have seen such massive support. Its all just infrastructure. Just government spending. It is also private credit expansion. Isare up 20 and that driving domestic demand as well as the government infrastructure spending. Maybe even more so. It is not entirely surprising we are seeing a wider deficit. It is not entirely surprising we are seating we are seeing a what wider deficit. As the economy domestically makes pretty strong. In terms of that further pressure on the currency that is larger than expected. What are policymakers expected to do . Are you expecting maybe we could get a surprise . Of course, one never expects surprises. Pretty surprising if we did get a hike. The central bank has been guiding pretty strongly over the last couple of weeks. Asy see the economy up running hot, but they do not see it as overheating. When the car is driving along quickly come up the car does get hot but it does not overheat. They want to leave things as they are in key policy on hold. To be fair, inflation is not overly worrying at the moment. Even if the margins do widen, it will not be wide in an absolute sense. I think they will stick with the bsp on hold for now. For next rate hikes year, but not in the first half of the year. Haidi what about indonesia of course amidst 15 global Central Banks setting policy this week. To major ones out of asia and the philippines. Is that economy going to fit in the goldilocks situation . So indonesia is in a very different position than the philippines. The philippines have grown strongly, where indonesia, the growth rate we have seen their is not high for indonesia at all. The currency count has narrowed over the last two or three years. Indonesia is in a different position. Credit growth is modest relative to history. We could see and acceleration. If we do get that acceleration coming through, that is a goldilocks situation for that economy. As tois a question mark whether or not that happens. The that hasnt happened yet to date. There is a real debate or skepticism on whether or not that really comes through in 2018. We think it will, but the fact that there is a debate means there could be a surprise. Consumption weakness has been they surprising aspect when it comes to the potential for indonesia. Edward, we have to leave it there, but i appreciate the inside. Thank you for joining us from singapore. Just a reminder, you can take a look at tv. Can take a look at previous interviews and do eight deep dive into what we have talked about. You can become part of the conversation by sending us instant messages. Check it out at tv. The polls have now closed in alabama after special Senate Election that will have wide ranging ramifications for u. S. Policy. Kevin cirilli joins us now from alabamas capital, montgomery. Since polls have closed, what more do we know . Kevin im here inside the Roy Moore Election headquarters. About 40 of the votes trickling more having as slightly. According to exit polls, it would appear that democrats are outperforming in counties that lean democratic. Voterre outperforming in turnout. And republican counties are underperforming in voter turnout. This race. Ly to call of course, it has taken on new meaning even outside of alabama. Just because of how important it has become in terms of the republican majority in the senate. Haidi absolutely. In terms of the variety of outcomes, none of them produce a straight shot when it comes to republican control of the senate. Kevin no it doesnt come a but it would make it more difficult for President Trump to a couple. Right now they have the ability to lose to votes in their own party in order to still accomplish their priorities. We saw this with health care. We are seeing it now with tax reform. If the democrats win, they would only be able to lose one vote. That is why President Trump decided to support roy moore. It did not the nothing in terms of impacting who voted for who. Haidi kevin, thank you so much for that. We will get back with you throughout the night as hopefully a more clear view comes through. Perhaps indication from exit polls that voter turnout in some of these more democrats strong areas are stronger. Not the only thing on the agenda, we will take a closer look at the boe. Cannot live without it. So if you cant live without it. Why arent you using this guy . It makes your wifi awesomely fast. No. Still nope. Now were talking it gets you wifi here, here, and here. It even lets you take a time out. No no yes yes, indeed. Amazing speed, coverage and control. All with an xfi gateway