There are concerns over the pace of the recovery, the second wave of infections. Infections rising in 22 states across the u. S. The dow ended the session up 1. 9 . The s p 500 up 1. 3 . The s p futures, under pressure. Oil also falling with the 35 a barrel level. This is after crude posted its first weekly loss since late april. We have, as i mentioned, fears of a second wave of infections affecting the fragile recovery. Investors are awaiting the opecplus joint Technical Committee meeting this week. Lets see how things are shaping up for asian markets. Monday, fragility well. On view as asian stock futures looking mixed after the regional benchmark cap to the first weekly drop in three. Patch,hitting a rough sinking more than 5 in three days. Signaling concerns around a potential recovery across the globe. Value performing decently in a for the month of we are going to find out if Central Banks will add support with rate decisions do including taiwan and indonesia. In japan, after parliament passed a record second extra budget, the boj has was seen was focused on its Corporate Funding program. Checking in on currencies, lets check in on the stand up moves early in the asia session. Aussie dollar under pressure heading toward 68. A, kiwi dollar moving toward key support level retreating from a fourmonth high that it hit last week under pressure, along with offshore yuan with beijings recent outbreak on watch. More Downside Pressure for emerging currencies which follow for the first week in a month. A jp morgan gauge of implied follows for the first time in several weeks. The risk barometer, the dolly gain the dollaryen. Haidi lets get to the top story moving the markets. At the start of the week fears of the coronavirus resurgence in china. Lets get over to our beijing correspondent Tom Mackenzie who was on the line. We have seen concerns that the second wave will play out in beijing with the shuttering of this major Vegetable Market. Tom yes, this is a cluster of deep concern to officials. Theyve been ramping up efforts to get it under control. It is real a real test for them. China reporting the largest daily increase in cases since mid april. 57 new cases, or new infections as of june 13, with the majority in the capital. They reported an additional eight more cases towards the end of the early part of sunday. In terms of the market, this is the shin for audi market, the largest fruit and vegetable and meat market in beijing. It was shut down early saturday after the virus was detected among some business owners. The equipment they were using particularly, a chopping board apparently used by the seller of imported salmon. That is according to state media. Officials later came out and said the genome sequencing suggests the virus, this strain of virus came from europe. And it is not yet known how it was imported. Authorities have been ramping up their efforts to get this under control, this outbreak. They have been taking samples at the market, they have tested thousands of people linked to it. They are aiming to test at least 10,000 people who work in or are linked to the market. 11 residential subdistricts near the market have been shut down, effectively in lockdown. Yesterday, it there were fewer people out and about and there buying. Orts of panic this is a real test for the trace and test system that china has been in place to see if they can crack on these clusters and stop them becoming major second waves. Shery we may be seeing a second wave in the u. S. As well. Cases surging in 22 states. Tom the latest numbers out of the u. S. Showcases increasing by more than 23,000. You are looking at a total of more than 2. 0 8 million infections in the u. S. That is a 1. 1 increase. It matches the average daily increase of 1. 1 over the past week. You saw deaths rising to well above 115,500. New yorks death fell for a second day, but floridas cases outpaced the weekly average for a fifth straight day. That is one of the states that is of concern to officials. You have rising infections, as he pointed out, in 22 states. That has led to officials and former officials saying look, theres a grill concern that you are seeing the start of a second wave in some of the states. Former head of the u. S. Fda coming out and saying the rise in case counts and high hospitalization rates does address the new outbreaks are underway. Shery that was Tom Mackenzie in beijing. More perspective on the pandemic ahead with harvard gold Global HealthInstitute Director joining us on daybreak asia. Says theyd, hong kong support chinas National Security bill for hong kong despite the shock move. Dont miss our exclusive interview. Up next, bloomberg uncovers stunning evidence that appears to support Carlos Ghosns playing claims that he was set up. That is just ahead. This is bloomberg. Youre watching daybreak australia. Im Karina Mitchell with first word headlines. Bank of japan opens a two day meeting on monday and expected to leave policy unchanged as the coronavirus weekends in an already struggling economy. The boj will leave asset person purchases as they are as they see the impacts already underway. Policymakers dont see a pressing need for major changes at this time. Australia is to announce a new Infrastructure Spending later to kickstart the economy in a era. Virus Prime MinisterScott Morrison will lay out plans across the country with the equivalent of one billion u. S. Dollars being allocated to shovel ready projects. He says he wants most parts of the australian economy back up and running i the end of next month. Next month. D of th virus lockdowns and worries with e. U. Saw the gdp back where it was in 2002, after plunging by a record 25 in february. The u. K. Economy is expected to recover, but is still seeing facing one of the worst recessions in the developed world. North korea is threatening military action against its neighbor as crossborder relations sour rapidly. Kim jongun empowered his sister says the next move against a soul will come from the army as tensions rise over a wave of antinorth korean propaganda from the south. Kim says it would be better for the north to take concrete action rather than respond by diplomatic statements. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Am Karina Mitchell. This is bloomberg. Back to you. He wascarlos ghosn said set up and others evidence to support the claim. What kind of evidence have you come across and does it stack up against was what nissan has been saying . Good morning. Essentially, what we learned here was that there was a much more methodical campaign to remove carlos ghosn as chairman of nissan, as well as ray no. Naud. Alliance. The foundations of the alliance were becoming a little shaky. Essentially, with what nissan discovered, and also sought in terms of investigating carlos ghosn, that then turned into more of a Corporate Strategy that alternately resulted in his downfall. Shery we had seen during this saga that thatn that then cl was one of the key players. Who were some of the main actors in this unfolding scandal . Reed at the center of some of the things that were taking place was a person named hari nata. He was the chief of the ceos really one of the key players here in terms of coordinated what was happening. So we have learned from some of his communications that he was as early asosn february 20 18th. And then leading right up until Carlos Ghosns arrest in november of that year. What is the state of play right now when it comes to the other key players . Where are they, what is the progress that is being made . What are they doing . Reed when you have to remember is that the downfall of carlos ghosn triggered massive management turmoil within the company. Eventuallythe time left over his own issues over compensation. A new Management Team was put in place, but that became shaky soon afterwards. You have to remember that another person that was arrested at the same time as ghosn, greg kelly, who was a board member, he is still awaiting his trial here in tokyo. And of course, ghosn himself made a dramatic escape out of japan at the end of december, and he is now in beirut living in a house bought by nissan. Although it is very unlikely he is ever going to face trial in japan. Shery we had heard from nissans latest overhaul plan that they could be looking into closer integration with renault, eventually given the state of the car industry with the pandemic ongoing. Wheret can we say about the carlos ghosn saga has left these two companies in terms of cooperation . The two companies did forge a new agreement in terms of how they would operate with each other. So far that is looking pretty good. Renault and nissan also need each other more than ever when pandemicder the global has really hit demand for cars. So, what they are both embarking on is a bunch of cost cuts, introducing new models. But really, the question is how can they extract more value out of the alliance while restructuring at the same time . Essentially, competing against much louder larger companies, even though they have a somewhat fragmented structure that includes mitsubishi motors. Shery Reed Stevenson there with the latest from tokyo. Coming up, traders returning from work this week are trying to decide for weather last week selloff was a blip or something more ominous. A mutual fund ceo gives us her outlook next. This is bloomberg. This is bloomberg. Mentality, the conditioning to buy the dip is embedded in this market. We certainly dont think this mini pullback is materially worse. We could see a downturn. I think yesterday, while the market was due for a pullback, i think the tone of it was probably too harsh. You think of where equities bottomed out at and how they have rebounded, they clearly got overextended. And a lot of that has to do with the feds easing money policy. For a time, as the market was selling off, it seemed like everything was going to rally you. Se the fed was behind now we have to be more cautious. Yeah, the fed is behind you but they will not recognize rescue everybody. You have to be more careful. Even with all the policy response, it will take a while to get back to the longterm Growth Potential of the u. S. Economy. It is going to be a check mark. It is not going to be a sharp v. Marketre concerned the has priced in a positive bounceback and Economic Growth that may not materialize. Shery some of our guests reacting to the wild and to last markets. He and for a deeper dive, joining us from santa monica is cr mutual funds chief Investment Officer terri spath. Great to have you with us. This gtv chart on the bloomberg showing our viewers what a wild week it was. In the u. S. , the worst week since march. We have the dow leading the declines. Given what we have seen in terms of the pace of the recent rally, our swift reversals inevitable . Terri i dont know if they are inevitable. The fed has said they will do whatever it takes, and that has ignited a stampede into stocks. It is sort of an allyoucaneat buffet that seems to be going on most recently. I dont think that is a prudent way to look at what is going on. I think what investors need to realize is risk matters. And it always matters. The most common question weve gotten recently is why is this stockmarket market moved up as much as it has, given the Economic Data being such a disaster . Ishink this sharp snapback prone to a lot of volatility Going Forward. Theres going to be big up days and big down days. I think investors really need to Pay Attention to risk in this kind of a sharp snapback that we have seen. Haidi we have seen a lot of retail shery we have seen a lot of Retail Investors getting into the stock market game. Given that discipline is important, where would you advise them to find opportunities . Terri yeah, i think that is a good question. I dont think it is just a buy all the stocks that are out there. I dont even think it is by the safe stocks. We have seen a lot of strategists point people toward safer stocks and dividend stocks. Yeah, those can be a little safer, but in our view, it think you need to expand your view of where to put your money. So right now, we prefer, prefer to stocks over financial stocks, for example. We want to pay a lot of attention to the drawdown that can happen. So prefer to stocks are issued by financial companies, but they are safer, a lot less volatility than financial stocks. We like highyield Corporate Bonds over smallcap stocks. For a similar type of reason, it tends to be similar types of companies. They are growing a lot, they are more risky, they are smaller. But the highyield Corporate Bonds give you a cushion with that. We like emergingmarket debt over emerging market equity. In this type of environment, i think you need to Pay Attention to the drawdowns you can suffer in Asset Classes and look more broadly in terms of where. You want to make money of where you want to make money. Haidi haidi what is the whole story . What does it tell you about the hazards that you have a company that is now offering shares despite being destined to be out, and readily admitting that those 1 million of new shares may be worthless as well . Terri yeah, i mean obviously, we dont like that. On the one hand, the fed really stepped in here in the u. S. And the government also with what they are willing to do to help bridge this period of time that is so challenging. At the same time, it is creating this living dead zombies type of market, zombie company. These kind of things, these companies i can only exist if they can borrow money. Which is the definition of a zombie company. It is not something we think is a good thing for the market. Same thing with his lame markets. It is like this a buying thing. And then creating a market that can only survive with further and further debt. I dont think that is longterm, a very good thing to do. Hopefully, we see these things start to unwind and the economy come back to normal. Again, risk really matters. Marketsne in these really matters because the drawdown, just as we saw last week, can be really, really sharp. Stairs niceakes the and slowly typically. And falls faster. It is important, particularly when things raced back up the stairs at a pace that is not typical, to Pay Attention to the fact that the declines can be so Pay Attention to that risk and really broaden the net as to how you are going to manage your money. Does your outlook figure into your preference for em debts . Terri thats a good question. I mean, with the dollar, i do think we could see potentially some weakness on that. We are not necessarily taking a view on the dollar. I think you can make the case for Rising Interest Rates in the u. S. You can make the case for falling Interest Rates with the scenarios out there. I think for emergingmarket debt, the call for that is really that risk is relative to emergingmarket equities, for example. If the dollar doesnt make a sharp move one way or the other, that is a good place to make some nice yields. These are countries that typically are trading like highyield Corporate Bonds in terms of their yield, and they are safer than that in our view. Shery we have seen investors givennt earnings reports, how skewed they have become because of the pandemic, when will they start mattering again . Terri yeah, it is really hard. Your guess is as good as mine in terms of what earnings are going to look like this year. And how fast they are going to come back. I mean, i think stocks have to trade on earnings. That is just the reality of it. But in terms of a normalized level of earnings is where stocks should trade. And there is nothing normal about 2020. Absolutely nothing. And i dont think any company has a good sense as to whether earnings are going to be this year. Ofi do think it is a period time where investors should take a breath, because things will come back very, very quickly. So look at your portfolio. If you made some things that have gone into the red zone, i think it is time to take those chips off the table. There is going to be a lot of volatility Going Forward. The risk to earnings this year, i dont think is necessarily to the upside. Even though they have come down quite a lot, just because there is no clear visibility on that. Will have to keep a view on that for 2020. Forward, it isng not going to be a vshaped recovery, because that is typically not how earnings come back. It is going to be a slower solution. Bear that in mind when you are looking for the growth for your stocks Going Forward. Shery when you are assessing every company this year, how much are you factoring in the potential of rising cost, whether it is adjusting to the new social distancing world because of the pandemic, or the rearrangement of Global Supply chains because of the u. S. China tension . Terri yeah, i think you are raising some really good issues. I think there are so many additional risks that have been introduced because of this pandemic that are almost making us forget about the risks that were already there. When we started 2020, the big discussion was this u. S. China trade issue that was going on. And i think now with the supply chain really being at risk, there can be some pain to the upside in terms of pricing. There is alsoe, inflationary pressures to the downside, just because demand has dropped so precipitously. So, not really clear how that is going to play out in terms of the cost structure for these companies. Our defense asng our number one approach to investing right now, in terms of, we want to have the trends but we want to have a ce