Boris johnson is due to the side on fridawhether to walk away from the talks. New zealand prepares to vote with polls indicating the Prime Minister will be a comfortable winner. Both party leade are criticized for not doing enough for women. Breaking news out of south korea. We are getting the jobless figures for the month of ptember coming in at 3. 9 , which is much higher than analysts had expected. Its also larger than the previous month, when it came in from august at 3. 2. 300 92,000 jobs were removed in september from a year earlier and we have seen the jobless rate ssawing. We did have the virus resurgence in south korea so that hit the labor market negatively and we had typhoons in september that might have skewed the numbers. The positive boost for the labor market in south korea is the governments planned fourth extra budget that should help the employment market. S p saying it will take many years for employment to return to prepandemic levels. We have seen the bank of korea just this week keep its benchmark Interest Rates steady as we are really close to that record low lower bound as well. The south korean september adjusted jobless rate coming in at 3. 9 , haidi. Muted looks like a session across the rest of asia as well with sydney stocks just coming online. This is where we are at in the staggered open for the asx, pretty flat at the moment. Ofare still, after months trading, seeing signs of momentum building in the australian stock rebound. The rming as well as retracement level suggesting we could see further support in the next leg up. Downside trading on the back foot. Broadbased u. S. Dollar strength , lost 1 , and of course, those rba expectations of further easing pushing the aussie a little bit lower as well. New zealand stocks on the downside for a second day after these recent highs going into the weekend election. Shery take a look at futures right now. U. S. Futures putting much flat after u. S. Stocks fell. We have the virus resurgence and we also had u. S. Stimulus talks still stalled so u. S. Futures at the moment unchanged. This as we continue to see some dollar strength. We have seen incredible resilience in the japanese yen which has really remained steady. 105 around that level. Mckay futures unchanged as well after they fell yesterday. Watch for fast retailing. We do get earnings today. The are seeing wti crude above the 40 a barrel level, but this of course after it was pressured because of some numbers, ecodata out of the u. S. That did not look that positive. The coronavirus pandemic, as i mentioned, ending the economic and Fiscal Health of nations and economies around the globe. This week, the imf and world bank highlighting key data that show the challenges and risks that lie ahead. Joining us now is our Global Economics and policy editor, kathleen hays. Kathleen thank you. I am so happy to be joined by a very special guest. Importantly,rt, she is chief economist of the world banks june. Just another step in a long career of analyzing the worlds economy. The trends and forces that shape it. And importantly, the author became the landmark tome the author of the book that became a landmark tome i want to mention that book and time because we are now in what you call the pandemic recession. You say it is hard to model. It has no precedent. Already, people said vshaped otherries, w, every letter in the alphabet. With the virus still active and people seeing no vaccines, they are starting to recalibrate their expectations for growth, for what they are wanting to call a recovery. What do you see . Carmen even back in march, kathleen, i was highlighting crisis being driven by the disease is very difficult to predict how long it would last. My expectation back then was s impact would be longlived. This did not start as a financial crisis but it is morphing into a Major Economic crisis with very serious financial consequences. Kathleen is there a risk its going to morph into any kind of financial crisis . A big topic this week, a big issue for the world bank, the suspension of debt payments for the worlds poorest nations, do to connect dots between what is happening there and what could happen more broadly . Carmen absolutely. The world bank had called for a longer extension, for a year extension. As it stands, it will be an extension of six months to be reconsidered, if it needs to be extended longer at the next annual meeting. Thatconnection is financial frailty, debt frailties, many of those were there already, have become manifest, and the longer the uncertainty, the longer the pandemic works its way through the Global Economy, the bigger the Balance Sheet damage. Corporates, households, banks, and certainly, for the poorest countries, i think there are dire needs that are very eminent. About half of the lowest Income Countries are already in debt distressed or approaching debt distressed. Kathleen you have warned of an unprecedented surge in debt crises. You are also concerned about banks that have once again become overleveraged. Do you put india on that list . How big is the risk the poorest nations, yes, its terrible, but its a smaller part of the economy. Again. Vulnerability of banks that could spread from one to another, particularly in emerging markets . Haven look, kathleen, i been highlighting, and the world bank has published an amazing report on poverty. Regressiveen a very crisis. It has hit the poorest within countries and across countries, in thevulnerability lower Income Countries and in emerging markets is much greater at the moment fan for the than foreconomies the advanced economies pit what are the consequences for that . Economies. What are the consequences for that . Emerging markets turned out to be the bright spot of that crisis, led by double digit growth. That is certainly not happening here. This is truly a global crisis. Kathleen is there a risk that this economic pandemic crisis turns into some type of financial crisis in some part of the world . Carmen yes, absolutely. I had called it the quieter crisis because at the moment, as you know, across the globe, many by law or by voluntarily, banks put in suspension. When the gust settles, some of the loans are not going to be repaid. I would venture to say a wenificant number because are seeing output declines and already, signs of building bankruptcies that are likely to has big consequences for bank Balance Sheets. Can it spread . Spread,tainly, it can but i would highlight that even without crossborder contagion in the classic financial sense, au are committing simultaneous hit. You know, the downturn has been synchronous and a lot of the Balance Sheets problems would also likely be in varying severity but also quite synchronous so that is a risk moving ahead. Kathleen china, our Bloomberg Economics team took a look at the data from the imf showing what was the headline a couple of days ago. China, the only major economy that is going to expand this year. They extrapolated from that to determine that theres going to be an ever greater role, a bigger part of chinas economy driving the Global Economy by the year 2020 five from Something Like 27 in 2021 up to about 28 to 29 . Has the pandemic given china a kind of permanent boost . Share in global gdp is poised to rise. I would highlight, however, that china went into the 20082009 crisis and continued for some time thereafter, growing at double digits, which has enormous positive consequences for the developing world. A strong Commodity Prices from their strong global demand. While the share of chinese global gdp is poised to continue to rise, i dont think that itine of growth factor that played in the emerging world is going to replay now. And certainly, during that time, chinas lending, overseas lending, especially to low Income Countries, really soared. Out is not likely to play in the coming years because those very same countries that borrowed from china are now, many of them, mired with significant debt overhangs. Hence the focus, big focus, of the annual meetings this year is what to do beyond the ssi. How do we go about helping these countries restructure their debt . Faster is better than a replay of the 1980s, to be sure. Kathleen if china is in such a strong position economically, then why are they not participating in the debt suspension relief that got extended this week . You would think that among other countries out there and all the hedge funds that they be in an excellent financial position to do that. That is a big problem for this whole effort to shore up these countries with debt relief. Effort has metsi two major hurdles. One is china has participated, but less than fully. The China Development bank, a major lender to the developing world, has yet to participate. Creditorsate sector have yet to participate. Years, manyhe boom of the lower Income Countries were also Frontier Markets borrowing from the private sector so full participation is something we should strive for but have not yet, unfortunately, seen. Kathleen a bigger question about Central Banks fighting the pandemic, doing everything they can. Rates near zero. Yieldsng bonds to keep low while your government sells a whole bunch of them, is that ultimately a zerosum game if every government in the world is doing it . Looks, we carmen are still in the dimension of fighting the war. This is a war. ,uring wars, Government Finance they are war expenditures. Right now, there are dire needs, as we have been discussing. Extrapolate, however, that this can continue, i think that that is not that is not a scenario the scenario we are in is not a sustainable one, and especially, i think, you know, some of the very welcome quantitative easing that we have seen in emerging markets, which thatfirst, the scope for being sustained Going Forward, i think, is more limited than perhaps many enthusiasts think. Kathleen a quick followup on that question. You lead into what i was wondering. If emerging markets have to compete with being more developed, stronger countries, will they have to sell their debt at ever higher yields and will that push them into taking on yields to become risky . On an you have hit excellent point. There has been quite a bit after the big scare in march and in april. There has been sort of this sigh of relief that countries have Market Access, and indeed, many emerging markets in developing countries have had Market Access, but you begin to question, at what price . 9 ,issuing debt at 8 , 9. 5 , what kind of growth do you need to be able to sustain that . That is another cause for concern that a lot of the Market Access is extremely pricey and undermines the debt sustainability of some of these borrowers. Kathleen looking down the road as your debt and deficit is rising, countries are looking at how they are going to finance how to manage that debt. Joe biden, for example, on the campaign trail, lets tax high earners. France said it will start taxing some of its social Media Companies again. In fact, the philippines we just spoke to the philippines finance secretary, and that is one of the things they are looking at potentially is some taxes on these kind of richer hightech companies that have done well during the pandemic. How is this going to play out . Is this going to be a plus . Is this going to be a drag . You know,think, unlike world war ii, unlike the war, the expenditures that we are seeing are not military expenditures that can be quickly reversed when the war ended. The need to look for new revenue needss to support social is going to be i think a very pressing one moving ahead, and this really cuts across, as you example,ed with your across all regions in varying degrees, and across all income strata. Of the the outgrowths very large budget deficits, very big debt buildups is going to move governments towards a seeking a variety of higher revenues, whether it is through tax increases or widening the base or a combination of the two things. Kathleen thank you so very much for joining us today. We appreciate it so very much. Great conversation, kathleen. Lets take a look at one stock we are watching closely in the sydney session. Rio tinto, the mining major, seeing some downside at the group, this after the reported thirdquarter iron ore that fell 5 on Maintenance Work taking place. Also flagging inventories in china may grow as china steel consumptions darts to ease back from record highs. We are seeing downsides when it comes to rio. It has been down every day except the thursday session in this week but it does continue to say it sees demand in china being supported by a commodity intensive stimulus policy measures as well. Lets get you a check of some of the other first word headlines that we are tracking this morning. Frexit negotiations are lurching towards crisis after leaders told Boris Johnson he must make concessions just hours before the Prime Minister is due to decide whether he will walk away. U. K. s chief negotiator says he is surprised and disappointed with the warning which came leaders. Summit of e. U. Johnson is expected to respond on friday with the u. K. Set to leave the Single Market on september 31. The u. S. Will strike much harder if the European Union goes ahead with tariffs on american products. Russells has won permission from the wto to put duties on u. S. Goods in a ruling over state aid to boeing. The e. U. Is weighing tariffs on a range of products but is likely to delay any move until next month selection. Antigovernment protesters in thailand have defied Police Orders and staged a new rally in bangkok despite a state of emergency in the capital. Ms traders gathered in the shopping district in front of the Central World mall, where scores of people were killed in protests years ago. They are demanding democratic and constitutional reform and curbs on the traditional power of the monarchy. New zealand enters the final day of campaigning for saturdays general election with polls indicating a comfortable win for the Prime Minister. The labour party has enjoyed a lead in all recent surveys thanks to the handling of the coronavirus outbreak. She is seen as a major draw for voters. Critics say she failed to deliver on some of the promises made in the last election. Those are your first word headlines. Shery we will have more on new zealands election ahead. We will discuss the lack of female friendly policies despite women leading both million political parties. Plus australias cotton industry says it could be the latest deterioratinge relations between canberra and beijing. Details, next. This is bloomberg. Haidi australias cotton industry fears it may be the latest casualty of tensions between canberra and beijing. It is working with authorities to understand apparent changes to export conditions. Is here in editor sydney. What were the impacts, practically speaking, if there was a ban on australian cotton . It would not be good news. Time is our biggest export market. It takes anything from 130 two thirds of our cotton exports in any given year so it would be a big hit to growers. There are a few factors that are mitigating that and one of those very big ones is that we have had a drought the past few years so our production has been quite low so there is not too much to export at this stage. Shery where do you export what are your alternative markets, especially do you have to veer away from china . Textiles several other industries, areas like vietnam, indonesia, bangladesh, that take australian cotton. They are quite small importers compared to china so it would be hard to place the cotton that china is not buying if that is covidse, but given this restrictions on a lot of manufacturing facilities globally, you know, it is very hard to predict where we could send it given the sort of turmoil in the textile industry. Have seen australian barley hit with chinese tariffs. What could be next . Ainslie we have been watching very closely that if an markets here that could potentially be hit. We have seen coal this week. For is being investigated antisubsidy investigations. They are keeping an eye on dairy and other grains, including oats and wheat. Theres a long list of australian exports that china could hit given they are our biggest trading partner thus far. This tradingsee relationship kind of deteriorate, what are the alternative markets we are seeing . The bigger question is would any of them be big enough to make up for demand from china . Ainslie look, no. In a word. All of our cotton export markets are much more than china. That said, the usda is forecasting australias cotton exports next year will be the smallest in 30 years so, you know, its a very different situation we might have been in a few years ago where we had a lot of cotton. Australian growers are reluctant at the moment because we had a high cost of water in recent years. Its also an annual crop so if farmers are concerned about the tariffs, they can opt not to plant it this year. Haidi what about demand from nonChinese Markets rather agricultural exports from australia . Other agricultural exports from australia . Ainslie depends on which export we are talking about. You know. I notice barley, we are looking at india, which has we cannot export it at the moment so australia i know growers and Industry Groups are working with india to get australian barley sent there for the malting industry so that could be a big market if we could get over the hurdle despite the sanitary conditions they have got. Australian wine, theres a lot of export markets they are trying to build. The big theme this year has been australian agricultural commodities. Growers and Industry Groups really looking for markets yawn china. It does not look like tensions will go away anytime soon. Shery bloombergs asia agricultural editor, ainslie chandler. Lets get a quick check of the business flash headlines. Twitter says its core systems back after an outage that affected users around the globe. Earlier, they reported an irregularity with the platform but says internal problems are being identified and fixed. An internet outage tracker received more than 50,000 reports about problems from twitter early evening thursday, new york time. Boss, masayoshi son, is said to be stepping up pressure on a holdings company. The startups are actively talking although a Sticking Point remains whether they should merge all operations. The cofounder is said to prefer the latter option. The ok motors has won for Autonomous Cars with no safety driver on public roads in san francisco. Dozens of self driving companies are allowed to drive in california with a human ready to take control. It is only the fifth allowed to launch cars. Its now able to conduct day and night time tests on certain public roads and no more than 30 Miles Per Hour and only in good weather. Coming up, ties between britain and the e. U. Lurched towards a new crisis as Boris Johnson weighs whether to walk away from talks. We will have the latest, next. This is bloomberg. So youre a small business, or a big one. You were thriving, but then. Oh. Ah. Okay. Plan, pivot. How do you bounce back . You dont, you bounce forward, with serious and reliable internet. Powered by the largest gig Speed Network in america. But is it secure . Sure its secure. And even if the power goes down, your connection doesnt. So how do i do this . You dont do this. We do this, together. Bounce forward, with comcast business. Has unified its commitment to achieve this even in a short timeframe, but sadly, we must soon prepare for the case that no agreement is reached. Any certain decision, nothing disagreed until everything is agreed. It is crucial. This is the moment of truth. To gois only one week before the european council. Toit is always the right way ask questions that are difficult. The last moment, you will find solutions. Shery the latest comments from e. U. Meters as time runs out for a trade deal with the u. K. That hisst saying surprise and disappointment he is surprised and disappointed that e. U. Leaders are demanding more concessions. Boris johnson is demanding to walk away after a summit in brussels. Lets get more from john authers. Great to have you on. Does this ultimatum sort of raise the stakes of a Nodeal Brexit . What they are trying to do is call Boris Johnsons bluff and they are making the bet that he will cave, which is what he did the last time they were discussing a Nodeal Brexit almost exact 12 months ago. When he gave way very significantly indeed on the issue of the Northern Irish arder, that was what enabled brexit deal to pass. Im sure thats what the e. U. Is and if i to happen, absolutely had to bet, i would bet that they are right. [laughter] you are a brave man to be a betting man on this situation. You just look at the headlines. On a knife edge, discussions lurching. What are the implications for markets . We have been here before. They can always gets kicked down the road. Are we at crunch time . John it is close to crunch time because whatever happens has a hard deadline for the end of the year. I think you need to take a look at what the headlines are elsewhere, particularly in the British Press because Boris Johnson is in far more trouble over covid at this point and the complicated latest plan for a new lockdown which is raising huge opposition across the country, including his own party, so amazingly, although we have got this very aggressive completelyxit, which dominated the country for years, not the biggest story at the moment. That is part of the e. U. Calculation that Boris Johnson is politically very weak. The other point is why the pound has not been a lot weaker in the last week or so is that there is a realization that some kind of weeal is likely because learned last time that that is what happens and if there is just any kind of a deal, british banks are likely to rebound very strongly, and sterling is likely to rebound very strongly. They are both currently banks are incredibly cheap, buy their own standards, and sterling the euro is what matters. Its very weak. Im sure this would be bad for British Assets if we have an absolute conclusive break in talks. But it could be worse. People are more worried about the idea of being taken by surprise when things whipsaw messed upassic e. U. Deal which is the most likely outcome. Haidi we are watching the other side of the divergence trade which is what happens to the u. S. Election. Always appreciate your time with us, john authers. Its take a look at our markets setting up for the final trading day of the week. Sophie is in hong kong. What are you watching . Sophie half an hour into cash trade in australia. The asx 200 led lower by csl as well as iron ore miners all went to percent. Still offsetting the gains we are seeing for banking stocks in sydney, and the aussie dollar holding below 71, set for weekly losses. Rising tensions with china and its adding to the pressure for currency while aussie bonds are continuing to gain ground this friday. Switching out the board to check on the mood for the rest of asia, we are expecting a muted start this friday. Kiwi stocks extending thursdays losses ahead of the weekend elections and ahead of that, we had a note from anz updating the gdp forecast for new zealand and futures in singapore little changed. It had a jump on the profit forecast. The yen just marginally stronger this morning. S p eminis gaining ground after the drop that we saw in u. S. Stocks saw a slight shift to value away from growth. Several strategists are marking a shift in market leadership potentially. We have seen this before. We had several false starts for value bets in asia which continue to underperform growth that we have seen for many years and structural shifts for the pandemic are adding to that support story fintech shares in the region but we are seeing bets on value and cyclicals warming up again on economic reopenings, improving business sentiment, as well as vaccine hopes. The allure has not diminished yet. Socgen out with a note saying recommending buying from u. S. Mega caps, looking to asia tech as we are seeing valuations are not looking stretched yet. They lets get more on Global Economy. Apollo Global Management copresident jim sees a delayed recovery from the pandemic induced downturn despite the actions taken by global Central Banks. He spoke exclusively with bloomberg tvs about his concerns about the economy. The response from the fed has been extraordinary and for monetary policies around the globe, it has been strong, but when you look at the real economy and you see what is going on in terms of the amount of companies, listed Public Companies that have problems making debt service over, if you look at the percentage of the employment numbers that are Legacy Industries in terms of travel, entertainment, lodging, they are going to have a delayed recovery. So Many Companies were focused on liquidity that you will find some that have situations where they have real issues in 2021 and beyond. While the consumer is in healthy shape from a real estate and homeowner perspective, you know, its harder for Small Businesses to get loans now. Is out. Fed work that fed surveys. Its much more challenging. Bank conditions in terms of getting credit are tightening as of the last couple of quarters. Thats getting welldocumented. There is a variety of issues with regard to industries that have yet to recover as well as some legacy concerns about the u. S. Consumer that give rise to concern along with some Balance Sheets. Insolvencys. Bankruptcies. What is your expectation of Companies Filing for bankruptcy over the next six month to 12 months . Jim i suspect you will see it a lot more into 2021. I think the numbers have been they shot up quickly in terms of expected defaults in the u. S. In the loan and highyield markets in march, april, and may. They have come back down. 13 to 15 in terms of credit defaults. They are down in the mid to high single digits. Inuspect Many Companies are a rush for liquidity and they added a lot of debt on to make sure they got through the troubled period but when they turn around in 2021 and 2022, they will find themselves having just way too much debt considering the revenue and earnings. Higherct you would see defaults, probably not in 2020, but as we are getting into second, third, and Fourth Quarter of 2021, i would suspect he would see some of those, and i would also add, you know, in 2008, the problems were clearly in the banks and residential real estate. Theirose problems raised head very quickly. If you have a view on what the problems are today and the challenges, you know, we have legacy unemployment, legacy impact with a consumer, as well as, you know, challenges presumably around commercial real estate, and those just dont raise their head quite as early in the party. Jim speaking exclusively to bloombergs reporter. New zealand preparing to vote this weekend. The leaders criticized for not doing enough to help women. This is bloomberg. Shery this is daybreak asia. A check of the first word headlines. Wechats hearing appeal over restrictions in the u. S. Says she is unlikely to rule in favor of the white house. The magistrate says she is not inclined to grant the governments request for a stay pending an appeal. She set the latest evidence on National Security concerns have not changed her opinions that the curbs would violate free speech rights for chinese americans. Supreme Court Nominee amy coney rett is set to have enough said to have enough votes with Mitch Mcconnell expecting a vote on october 23. Thats about one week before the election. It would complete the entire process in less than a month. Democrats say the confirmation has been rushed for political reasons. By president ial nominee Kamala Harris is suspending all travel after two of her staff tested positive for covid19. Her Campaign Says she and her husband are both negative. But she is taking extra precautions. Joe biden was negative in his latest test. Neither of pariss staffers was in close contact with him and his Campaign Schedule will not be affected, and those are your first word headlines. Have beenwe discussing, new zealand goes to the ballot box on saturday for an election that polls suggest will deliver a second term. Looks set to reward the Prime Ministers handling of the crises including the coronavirus pandemic which has set the country into the biggest Economic Contraction since the great depression. Time in newecond zealands history, women lead both major parties heading into an election. And is the Labour Party One of the most popular Prime Ministers they have ever known. She led new zealand through the terror attack last year and more recently, one of the worlds most successful containments of the coronavirus. Her opponent is the leader of the centerright National Party. He has a reputation for toughness, earning the nickname crusher from her time as Police Minister in a former government when she led a drive to crush the cars of illegal street racers. There are genuine policy differences between the two major parties. A intends to raise taxes for top earners and increase the minimum wage. National promises tax cuts, especially for middle income earners, saying no country ever taxed its way out of recession. New zealands elections run on proportional representation. Kiwis have two boats, one for their local candidate, one for their party of choice. 120 seats in the parliament, 60 are for local candidates and the other 60 are directly proportionate to the party vote. On current polling, the labour party could make history by becoming the first party to govern alone since the system was introduced in 1996. If she does need a coalition partner, the greens look certain to be returned to parliament as well, ensuring a second term. As she knows all too well from her unexpected rise to power in 2017, shock results can happen. Haidi new zealand neither have policies to address the fact that women in this pandemic have been the most impacted. Our next guest describes a frightening silence over these concerns. The president for the National Council of women, lisa. Throughout the course of this healthcare crisis, the recessions that we have seen around the world, we continue to talk about the regression when it comes to progress made by women in the workplace. To what extent is it alarming to you that there has not been specific targeted policies that have been part of this campaign . The National Council of women theew zealand speak to gendered outcomes of the covid experience in new zealand. By and large, the people that are newly without work are women. We have been intrigued that the policy that has gone to government has not included an overt response. We said that needed to be considered. I think if you speak to people outside of new zealand, there is a perception that there are not as many gender issues or equality issues in the country. Is that a reality or does there need to be more policy work to be done by the new government even if it is a continuity government . Lisa that is an interesting perception then we are glad that people are looking towards new information about how to transform their leadership. Whopoke to a young woman rose very quickly through the ranks of her party. More progress beyond leadership. What we have noticed is that when leadership is led by women, it tends to support leadership roles across government. However, the areas that tend to been collected is sitting outside the public. What we are looking for is women who are still being pushed through gendered expectations and unpaid work such as childcare, that they are given more opportunity in places where wage growth new zealand. We need to eradicate some of the gender stereotypes that still exist within new zealand. We are not immune to that. We still have a high expectation of what we think a male should behave like and what we think a female should behave like. That also links to what we value and we dont value. The Council Woman supports the pathways that are open to all genders so that we can see a woman moving into those more economically productive and valuable sectors. We would also like to see more infrastructure put in about people that need it so we would like to see more infrastructure and consideration given to childcare, eldercare, so they are recognized for the value they bring to our communities. We are not immune to what the rest of the globe does. Is there such a thing as reluctance from political candidates, female political candidates, to portray themselves as the female candidate, that perhaps this effort in not branding themselves as the female leader, speaking of position, they actually reject or not focus so much on some of the policies that are actually needed . Lisa its a really good point and it is a fine line for politicians to be able to fully step into the role themselves canuse the political arena be so abrasive. And again, speaking to those gendered assumptions and the values we place on what it is to be feminine and what it is to be masculine, they are fully articulated within the political arena in new zealand. Sense ofto have a being able to handle that can happen within parliament. That means sometimes politics is in a place where women want to politics is not a place where women want to see themselves. We have work to do about respectful workplaces. Have youch progress seen in new zealand under the Prime Minister, whether its in the government or in the private sector . Lisa we have seen it within leadership roles. There is a real good look at the public and private sector in getting governments boards to 30 female representation. It is still just dipping our toes in the water. While leadership in a Strategic Direction can be wellbalanced, it needs to be fully expressed throughout the machine of government and through the private sector and decisionmaking that they undertake for their businesses. Great having your insights. National council of women, new zealand president. We will have more on what to expect from the new zealand elections later with the Business New Zealand ceo. Up next, we are watching uniqlos parent which sees profits beating expectations next year. We will discuss the factors rising that optimism. This is bloomberg. Haidi a quick check of the latest business flash headlines this hour. Rio tinto has reported iron ore shipments that fell 5 , warning inventories of china grow with Steel Production easing back from record levels. Rio says demand from china accounts for more than half of its iron ore revenue and has been supported by intensive stimulus measures in beijing. Rio is warning that slowing economies elsewhere threaten the recovery. Defaults from china say evergrande has repaid two upcoming bonds with about 1. 7 billion as it tries to avoid a looming crunch. The Securities Company says evergrande has met and support and interest obligations while failing to cite evidence or sources. The company is trying to raise money to meet its debt with its top investors said to want fault repayments. Covid19 and working from home has not stopped the wall street governor juggernaut. They have already generated about 84 billion this year. Trading gain since the start of the pandemic Consumer Banking operations. Shery we are watching asias biggest retailer when japan opens in a few minutes. The shares closed at a record high after same profits were returning to prepandemic levels this year. Lets bring in the senior analyst, kathryn. What were the Key Takeaways . Set of results. The key surprise came from japan and Greater China whereby sales july, ands over june, august beat expectations. A veryearly came from disciplined approach by the company to iranian on discounts. One of the other contributing factors would be the strong sales of some of the products including which has been selling well in japan. Haidi in terms of the projection for an 83 profit rebound when the Fiscal Year Ended in august 2021, is that realistic given we have most companies a lot of retailers scrapping their projections given the level of uncertainty . The underlying expectations for that projection through to august 2021 is that the covid19 outbreak will be more contained relative to where we are right now and that should actually contribute to better customer traffic at stores and hopefully buying sentiment across the various markets. I think that is something that we need to achieve through the next couple of months into next year to see whether that pans out. Of course, it is a very depressed base that all retailers are coming from. Notably, over the earlier parts of february through may. The initial impact of the thatavirus outbreak affects sentiment. On a year on year basis, seeing a big rebound in sales and profits should not come across as a major surprise. Haidi they will also need to see a big rebound continue in china. What are the expectations given we have just had golden week . Worked out some of the numbers, i think we should expect to get 25 year on year growth. That includes sales in mainland china. That should offset some of the lingering we might see in other parts of Greater China and reiteration that it is going to be very disciplined in the promotions that it will be launching on the mainland, i do think that we can be expecting higher profitability in the country into next year. Our senior analyst, catherine lim, talking through expectations for retailing. Daybreak asia, coming up next. We will be speaking to a leader about expectations in asia. Quite welcome to daybreak asia. I am shery ahn. Asias major markets have just opened for trade. Facing anets uncertain start. President trump is pushing a bigger relief package but Top Republican in congress is not taking it. The u. S. Has already imposed restrictions. Antigovernment protests in thailand despite Police Orders to stop the rally in bangkok. Japan and south korea are coming online. Here is how training is looking at the moment. We are seeing japanese stocks under pressure with energy and we did the declines. The japanese yen holding steady. We are watching for fast retailing. Profits were returning to prepandemic levels. It remains unchanged but do watch for that. Take a look at what south korean stocks are doing. They are getting. 1 . This is coming on the back of three sessions of losses. We have seen strength in the u. S. Dollar. That rose them both in three weeks. The korean won is also under pressure. Despite the fact that it is around the strongest level since april. We did get unemployment numbers. The rates coming in at 3. 9 higher. Telecom saying a bid up 4 10 of 1 . They Just Announced that they will be stemming off their mobility business. They have signed an agreement with uber. In australia, some downward pressure and it comes to the geopolitical side. There is going to be an impact on this trillion cotton exports. We are seeing that plant out when it comes to weakness in the aussie dollar. Lower because of lessened expectations out of china. That is despite expectations few herrings are being met. We are seeing that 10 year yield trading at 7, 8 or nine at the moment. Shery the pandemic has evolved and so has the asian equity rally. The rebound is over. It is time to be selective. Our correspondent joins us. Great to have you on. If we are trying to be selective in asia and even a bit more defensive, where are you going to get those opportunities . Shifted a little away from taiwan and into china. We are very strongly staying in part as opposed to south asia. The nature of stocks will play out in the next quarter or two. We want to be with stocks that are showing strong earnings. Those seeing more of opportunities in north asia as opposed to south asia. Shery you mentioned to china, how much has to do with the fact that there are more u. S. Economy stocks and perhaps those pandemic say stocks across the region . Safe stocks across the region . , you are right. , they wantou heard by 20ome Carbon Neutral 2023. They are being driven by the domestic economy, the economy is recovering 20 quickly. Very quickly. Shery do you think the direction of the yuan Going Forward will try to curtail the strength . Hasnt had much impact when it comes to the direction of the equity strength . I think the Chinese Government is taking a longterm view on this. The Chinese Government is more likely to support the market than not. That has to do with the fact that there is a lot of Retail Investment in the chinese equity market. They also want the chinese equity market to have a larger role in the Global Financial banking. I think over the longterm, frome going to see more china. Shery is there a shift in sentiment with regard to expectations after what happened after the u. S. Elections . It seemed like investors were more optimistic after a clean win by the democrats. Youre not in that camp. I think that we could get win from it. I just dont know how it will play out in stocks. Especially in asia. The markets in asia are strongly still driven by investor sentiment. When signaling higher taxes could slow down investment in that region. My hesitation is in terms of how we might see stock prices react to it. Given that uncertainty is why we are positioned this way. A partnert was pooja, at Capital Market there. This is fresh on the hose of the blockbuster ipo. This is where we are seeing that stock trading. The k pop agency sword on his debut with a bit of a come downtoearth. Down about just 8 . This is just after we saw an opening of 236. Rising as much as 30 the upper daily limit. It started trading yesterday of course. They represent the members of the worlds bestknown boy band, bcs. We are seeing a bit of a correction from what we saw the first day of trading. Retailing is what we are watching today. The makers are up by two and 3 10 of 1 . They are beating estimates and optimism when it comes to the Chinese Market as well. Lets get you a check of the first word headlines today. The u. K. And france are taking tough new virus restrictions. This is as infections head toward the 40 million mark. Going are over undergoing overnight curfews. Daily infections hit records in germany, italy and ireland while spain report of the most new cases there since april. Negotiations are lurching toward the prices of european leaders and they told Boris Johnson he must make concessions until hours before the Prime Minister is due to away. He is surprised and disappointed. That came during a summit of eu leaders. Johnson will respond on friday. Zealand enters the final day of campaigning for saturdays general election with polls indicating a comfortable win for the Prime Minister. The labor market the labour party has enjoyed a lead in surveys things because thanks to their handling of the coronavirus outbreak. Draw foreen as a major voters. Antigovernment protesters in thailand have defied Police Orders and staged a new rally in bangkok despite a state of emergency in the capital. Demonstrators gathered in the main shopping district instant in front of the Central World mall. Democraticmanding reform and curbs on the traditional power. Those are your first word headlines. Our interviewead, with the world bank chief economist. The virus pandemic is morphing into a Major Economic crisis. Letup next, china moves to shield its advanced technology in its fight with the u. S. This is bloomberg. Haidi china is set to pass new laws restricting tax exports on National Security grounds as competition continues with the u. S. That is according to washington who regularly uses export controls. Lets go over to asias government managing editor. This is the progression of the story we have been tracking the applications of. Implications of. Haidi we will try to get back to him on chinas control of its exports very soon. First, the pandemic has posed audible challenges for the world but also, opportunities for investors. Kellogg group spoke exquisitely to bloomberg about how the firm will invest in a postpandemic world and why asia is a key focus. The difficult part of this whole equation is that you have significant the quiddity that theseeated an ability for valuations to stay high and in some cases, even push higher. The issues i think we all have to be aware of is in my mind, touidity does not equate solvency. We have to think about the fact that after the last great financial crisis, we had situations where companies were quite solvent but in fact, illiquid. But this time around, it may be that we have companies that are insolvent but remain liquid. If you go back to the spring of this year, i was very worried about what would happen in 2020. With the onset of the crisis. I think it is fair to say as we look back, 2020 may have exceeded our expectations from earlier on in the air as to exact we what happened. Kickroblem may be that we a lot of issues into the future. We deferred a lot of issues. That is when the square will be circled or the circle will be squared up. Issuesar, some of those may come home to roost. Aat you may actually have is less positive year. We do really think there is a separation between the markets and the economy right now. It is supported by the quiddity. It will be an interesting environment moving forward. We will see where the opportunities will be and how to take advantage of them. The good news is that we have such a longterm perspective. H a Global Platform within with industry expertise. David lets talk about that. What are the conversations you are having with your teams . What are they bringing you that feels interesting in terms of sectors that maybe you have invested in traditionally or maybe you stayed away from. You invested across the spectrum but i think about Something Like retail. Celebrationad in a to the downside in many ways that was already underway. How do you invest in a space like that right now . Put your finger on it right now. I think there is a wide amount of outcomes. Other sectors could face existential issues to the point that you just raised. It is really dependent on having industry expertise and a Global Platform so you can quickly sort through where you think the winners will be and if we should be more circumspect in terms of our investment approach. I would say in general, there are a couple of buckets to be thinking about. First, asia in particular is growing faster. We see lots of opportunity there. To 1. 5 billionse there already. We do see huge opportunity in credit because Asset Classes are acting differently. We see a lot more Credit Opportunities because of the volatility and dislocation that is occurring. You have to be able to pivot on the big large bios and carveouts. The reason buyouts and carveouts the reason they are delayed is because of what we see in technologies like Industries Like technology and health care. Lets get back to one of our top stories. Daniel is in hong kong. We are seeing china make these owns to shore up their intensity intact. How does this accelerate this idea to diverging sectors . For a while, china has been debating this. It has taken on new urgency with everything going on with the u. S. , tiktok in particular. What china is saying essentially is that we have technology that we want to protect. Just takenies cant some of this tech that we have. The algorithms. Wayok for example, while holds a lot of the 5g patents. Huawei holds a lot of the 5g patents. China is adding another tool to its toolbox. Saying we can restrict the sales as well on National Security grounds if needed. That is something they dealt with from the u. S. For a while now. They have been very critical of it. It is a lot about gaining reciprocity. Reciprocity against the u. S. In this wider global tech site. Does the existing control compared to the u. S. . Right now, it is much more narrow. It is about nuclear issues, biological materials. It could expand in the future. There has been suggestions from lawmakers in the recent debates including things like algorithms and more of the advanced tech where china does hold some comparative advantages. This is just the shell of it. This is the first time that china is having this expert control. Ascould see it past as early saturday when the Standing Committee needs envisioning. Beijing. In thank you so much for those insights, bloombergs asian government manager joining us from hong kong. Coming up, political unrest in thailand continues as protesters the to keep taking it to the streets despite a state of emergency in the capital. We will have more out of bangkok next, this is bloomberg. Antigovernment protesters in thailand stage a new rally in bangkok. We are joined by our reporter in bangkok. Randy, give us the latest on this protest. Of these protests. Tens and thousands of protesters have staged a rally in bangkok for a second straight day. At thise, they gathered intersection in the middle of bangkoks man shopping district. The location is in front of the road shopping mall. The site of demonstrations in 2010 that ended with a clearance operation with scores of people being killed. The protesters blocked the main think intersection and the main roads leading to it. They were calling for authorities to release protesters that have been arrested. They are calling for the rewriting of the constitution for greater democracy and less power for the monarchy. What are we seeing in terms of government response . No violent clashes last night. The protesters called off the gathering around 10 00 p. M. Ice then started to person dispersing. Yesterday morning, the Prime Minister declared a state of emergency to quell this escalating protest movement. Tens of thousands of demonstrators corralled at his office to push for his resignation. The emergency most prohibited the gathering of the spot. People have said that police said that protesters broke the law and legal actions will be taken against them. For a long time seen some degree of political instability in thailand. What prompted these latest protests . What happens next . They cannot because they felt the government is not doing enough for them. The protester vowed to continue that movement. Planted together again in central bangkok. Political analysts said that this movement will likely escalate because the protesters are angry. So far, they did not listen to their demand to try to suppress that movement. Gathering on friday night and this weekend will be something to watch out for. It could draw more demonstrators. Thank you. That was randy in bangkok. There are wider geopolitical concerns at play there. Lets get you caught up with the latest business flash headlines. Twitter said this bull is back. The affected users around the globe. Irregularity reported with the platform. Down outage detector detected. Stepping a pressure on grub holding. We are told that southeast asias two most valuable startups are actually actively talking. A Sticking Point remains whether they should merge or not. The cofounder is said to be in preference of the latter option. Is emergingtics from the coronavirus. It is offering new services. Half a million indians living in northern britain. It already plaster those cities and launched Pakistan Services back in august. Asias largest retailer sees profit beyond analyst expectations this fiscal year, driven by robust recovery in japan and china. It will being says 2. 3 billion or thereabouts. Fast retailing sees a swift return to prepandemic levels. Oflets get a quick check the currencies across the region. The japanese yen holding steady. They have not moved that much on the range of 105. We have seen the nikkei under other bit of pressure. Strength on the chinese yen. We also had the pboc injecting funds to the financial system. The aussie dollar is under pressure again. This is after we had the low coming out and flagging more easing. Not to mention the ongoing australian and china tensions. The korean won is down. 2 . We had significant strength for the korean won last week. At one point touching the 18 month high. Later on bloomberg, we will speak to the Chinese Company that partnered with eli lilly. Ont miss that interview next, it looks like we are seeing a repeat. A look at the key Economic Issues next, this is bloomberg. Are you frustrated with your weight and health . Its time for aerotrainer, a more effective total body fitness solution. announcer aerotrainers ergodynamic design and four patented air chambers create maximum muscle activation for better results in less time, all while maintaining safe, correct form and allows for over 20 exercises. Do the aerotrainer super crunch. The prestretch works your abs even harder, engaging the entire core. Then its the back extension, super rock, and lower back traction stretch to take the pressure off your spine and stretch muscles. Planks are the ultimate total body exercise. Build your upper body with pushups. Work your lower body with the aerosquat. The aerotrainer is tested to support over 500 pounds. It inflates and deflates in less than 30 seconds using the electric pump. Head to aerotrainer. Com now. Now its your turn to lose weight, look great, and be healthy. Get off the floor and get on the aerotrainer. Go to aerotrainer. Com, thats aerotrainer. Com. We have some breaking it go ecodata for singapore. Risingseeing exports 5. 9 yearoveryear. Worse than the expectation of a rebound of 11. 5 . Falling. Significant worse than expectations of just over 4 there. Splitting up and it comes to electronics. That is better than expectations of just shy of 20 increase there. In terms of the volatile pharmaceutical sector, petrochemicals also contrasting close to 24 year on year there. Typically, when you compare it back to the month of august, we saw a rebound 7. 7 . Still on a recovery trajectory but not as strong as markets are expecting. This continues to suffer in singapore. Different economics and was we are getting from across the region. We are seeing a risk off tone in asia. The regional index set to halt a twoweek gain. We are seeing losses being led in sydney by miners. Kiwi stocks are slipping ahead of the new zealand elections. Ahead of that is upgrading the forecast on the gdp inflation and job market outlook. We are seeing declines for the nikkei 225. Over it and so, the cost with hit big hit entertainment, the biggest laggard, sliding after a strong debut that we saw on thursday. On sector of notes, we are highlighted japanese telco stocks. This is the Prime Minister, saying that reforms will proceed starting with mobile fee cuts. Therey says that is just first stop when it comes to more cost cuts across the sector as they attempt to sustain cash flows. We are seeing a mixed bag when it comes to japanese telcos. Shery lets turn our attention to the world economy. Seriouse a very financial consequent is here. Economic to her global and policy editor, kathleen hays. This has been a very regressive crisis. Worst within countries and across countries. In the lowbility Income Countries and in emerging markets is much greater at the moment then for the advanced economy. The global consequences of that . Do forget, we had these conversations back around the 2008 crisis. Emerging markets turned out to be the bright spot of that crisis. That is certainly not happening here. This is truly a global crisis. Is there a risk that this economic pandemic prices turns into a financial crisis in some parts of the world . Absolutely. It the quieter crisis because at the moment, as you know, across the globe, whether by law or voluntarily, banks also included suspension with grace. When the dust settles, some of those loans will not be repaid. Awould venture to say significant number because we andseeing output supplies signs of voting bankruptcies that are likely to have big consequences. Can it spread . Most certainly, it can spread. I would highlight, even without crossborder contagion in the classic financial sense, you are getting a simultaneous hit. The downturn has been very synchronous. A lot of the Balance Sheet problems would also likely be quite synchronous. A risk, moving ahead. Has the pandemic given china a current a permanent boost . Carmen i would highlight that china went into the 20082009 crisis and continued for some time thereafter, growing at double digits. That had enormous positive consequences for the developing world. Theirity prices from strong global demand. While the share of chinese global gdp is poised to continue to rise. I dont think that engine of growth factor that played in the emerging world is going to be played now. Certainly, during that time, chinas overseas lending to low Income Countries really soared. Playing out not right now. Nor is it likely to in the coming years. Very same countries that borrowed from china, many of them are mired with significant debt overhangs. Stronghina is in such a economic position, why arent they participating in the debt suspension relief that just got extended this week . You would think that among all those countries out there and all those hedge funds, they would be in an excellent financial position to do that. Problem that is the big for this whole effort to shore up these countries with debt relief. The effort met two major hurdles. China has participated but less than fully. Ae China Development bank, major lender to the developing world has yet to participate. Creditorsate sector have yet to participate. Ofing the boom years, many the low Income Countries were also protear markets, borrowing from the private sector. Full participation is something we should strive for but have not yet unfortunately seen. Was the world bank shiva economist, carmen reinhart. Economist, carmen reinhart. Voters look set to reward the Prime Ministers handling in new zealand. Of the coronavirus in new zealand. For the first time, women lead both parties just heading into the election. This is one of the most popular Prime Ministers the country has ever known. She led the country through a terror attack last year and had one of the worlds most successful containments of the coronavirus. Collins has a reputation for ,oughness, earning the nickname crusher from her time as a policeman. She led a drop to crush the cars of illegal street measures. Tend to raise taxes for top earners. National promises tax cuts, especially for income earners. Aw zealand elections run off portion representation. Kiwis have two votes, one for their local candidate, one for the party of choice. 60 are for local candidates and the other 60 are directly proportional to the party vote. The labour party could make history by becoming the first party to govern alone since the system was introduced in 1996. If she does need a coalition partner, the greens look to return to parliament as well, insuring her a second term. As she knows all too well from her unexpected bus to power, shock results can happen. Lets bring in paul allen. The Prime Minister is expected to comfortably retain power. What is her second term look like . Policy, not a huge amount of difference. He mentioned there would be an increase to the top tax rate. That is about it. It is the composition of the government that looks different. Right now, the deputy Prime Minister is winston peters. He is the leader of new zealand s first he was the one byinted under power in 2017 offering his support. On current polling, he and his party are both gone. Who as was mentioned, she is doing so well that she may be able to govern alone or certainly with the import of the greens if needed. Support of the greens if needed. The greens are proposing a wealth tax for anyone over a Million Dollars in assets which may sound like a fair bet but anyone who has a freehold house will find themselves firmly in that category. The National Party goes onto its third leader now, really struggling to cut through the pulling in the low 30s the moment. In the low 30s at the moment. The Prime Ministers response to the coronavirus pandemic is held up as an International Success story. But how has her governments other policies stacked up . The response to the crisis was very good. They went hard, went early and the strategy worked. There were only 25 deaths in new zealand. Apart from the struggling tourism industry, life in the country is mostly back to normal. For all this happened, the polls were looking pretty tight at the start of the year. A lot of the policies promised back in 2017 never happened. There was a pledge to build 100,000 affordable homes. A little over 500 of those got built. It was a pledge during homelessness. There was a pledge on carbon 2030. Y by 20 all of it got overshadowed by just rolling crises. Re was the crisis christchurch massacre. Thevolcanic eruption on island and the covid19 crisis. All of that was an effective distraction to a lack of delivery on other fronts. It will be interesting to see what the next three years bring. Paul allen in sydney. We will have more on what to expect from the new zealand election. This is bloomberg. This is daybreak asia. A check of the first word headlines. President trump is wrapping up his meetings with senior republicans. He is blaming democrats for delaying an agreement but says this goes further than the 1. 8 trillion deal that majority leader Mitch Mcconnell projected. Mcconnell says there is little immediate prospect of an agreement. Is appeal over restrictions in the u. S. She is unlikely to rule in favor of the white house. Laura says she is not inclined to grant the government request for this pending an appeal. This has not changed her opinion. President trump has warned of the u. S. Will strike much harder if the European Union goes ahead with tariffs on american products. Wants to but duties on u. S. Goods the you is a range ofriffs on products including aircrafts, coal and food. Those are your first word headlines. Confidence is so skyhigh about this blockbuster ipo that it speaks to the optimism behind what will be the biggest ipo in history. Part of what our next guest says will be about 2020 listings. Paul joins us now. To what extent does the success a long timeis such in the making how does it set the tone for what has been a pretty busy time when it comes to the listings and deals . Yes. Thank you. We just witnessed the most active quarter in the last 20 years in terms of raising the ipo market. It is the second higher secondhighest in the past 20 years. Dependable drivers, there are number of reasons. This import of liquidity available in the market. There has been a backlog of deals from the Second Quarter because of the lockdown in some of the major economies. The deals the ipo deals start to pick up since the last month and the Second Quarter in june. Also, we are seeing Companies May be exhilarating there ipo process ahead of the u. S. President ial election next month. And the fact that because of the lockdown, there is actually more efficiency in terms of the ipo process because people are moving onto the virtual road shows. Of course, you can do more and cover or investor meetings in the day. Also, the process of shortening this in order to manage the market volatility risk. Last but not least, we think there were less people traveling, taking holiday during the summer months because of the lockdown. Also, we are also seeing signs of pickup, you know the traditional markets, you know andhong Kong Hong Kong the u. S. We are seeing some examples from london, tokyo, even the thailand stock exchange. Shery when valuations are pretty breathtaking some of the factors you just cited, liquidity, these are fundamentals that are not likely to go away. The search for yield, the availability of central bank driven the quiddity. Do you expect this level of activity and interest to continue into next year . Paul . There is always some reservation. Have been seeing very Rapid Advances in some of the prices. Especially in the top sectors, technology and health care. Theave been seeing some of investors confidence is a little bit fragile. They have actually been building proper position. I would not be surprised to see some of these investors deciding to sell when they see the first sign of any market uneasiness. At the going rate, everything is good. U. S. President ial election happening in less than a months time, there is still going to be some market volatility and uncertainty. After theat mean that u. S. Election when all of these ipos are out the door that we could be seeing some cooling in this space . Yes and no. It would depend on the outcome of the u. S. President ial election. The market is watching that very closely. Typically, traditionally, the normally stands aside during the election. Then it starts to look at the position again post u. S. President ial election. It can be good or it can be going another way around. There is certainly this kind of uncertainty in the market. Geographically, what are you excited about . Paul we are seeing a huge number of Companies Going public. Especially in the asianpacific market. Namely hong kong, china, tokyo. Thailand is doing very well. We are seeing some of the of foreignu. S. Rules Companies Listing in the u. S. ,here is a healthy pipeline originally coming out from china, looking to do a secondary listing elsewhere. We have seen a deals of the u. S. Listing chinese companies. Of those deals actually happening in the last four months. That was paul. Thank you for joining us. This we are watching iphone chipmaker restarting. The Company Raises the 2020 revenue forecast for the second time this year. This is bloomberg. A complete check of the latest business flash headlines. Third quarter iron ore shipments fell 5 , one that inventories in china may grow as mainland still Steel Production reels back. This has been supported by intensive stimulus measures in beijing. The slowingng that economy elsewhere threatens recovery. There is still roadmap to the future. This is the base plan to share if tech and manufacturing collapses. Relations with gm have collapsed. Autonomous cars with no safety driver on public roads in san francisco. Dozens of selfdriving companies are allowed to drive in california with a humid ready to take control. The cruise is the only the driverless car. Raising its Sales Forecast for the second time this year, reflecting Strong Demand for 5g mobile devices, including apples of iphones. Insee revenue declining 30 2020. Lets get more from our breaking news editor in taipei. Cindy wong. Cindy the q3 the quarter earnings beat all estimates. It rose to a record high and came in at 1. 7 3 billion. Ise importantly, it raised 2020 revenue forecast for a second time this year. The company now sees itself higher than the previous forecast of 20 . That reflects the Strong Demand for 5g mobile devices like apples new iphones and highperformance computing in the post pandemic europe. For the third quarter, companies ceased so is revenue around 12. 7 billion. That is higher than analyst estimates. This is another key indicator of tmcmarket, closely watching tsmc. Tsmc. All very upbeat for just year dominance in the narrative. What are the other issues that tsmc about . Ed cindy analyst arcing to know theirtsmcs views and clients. They were compliant with all u. S. Government restrictions on huawei and have stopped restrictions to the giant after midseptember. Are still accepting impact from u. S. Export restrictions. Tsmc also made the comment on the overall inventory for its clients, including smartphone makers. Saying the inventory will remain above seasonal levels for a longer timeframe due to the lingering concerns over the reliability of the supply chains. Said they met with the Arizona Governor about their local plan. The company said they will build a chip plan when all the required conditions are met and the decision has nothing to do with politics. That was the breaking news editor, cindy wang in taipei. Tom it is 9 00 a. M. In beijing and shanghai. Welcome to Bloomberg Markets china open. Im tom mackenzie. Yvonne im david inglis. We are counting down the last trading session of the week on the mainland in hong kong. Markets across the region drifting as investors await news on a u. S. Stimulus deal. 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