On the value of its new business, following the fall since it listed the most. We will be joined by the ceo. Reports amid rising u. S. Tensions and fears of backlash from the white house. More challenges may be growing closer to home. Lets get a quick check of the markets with sophie kamaruddin. Stocks with a subdued start, futures lower. Kiwi stocks higher by 0. 2 . At m a, andlooking south korea raising a red flag. In sydney, stocks hit a fivemonth high. Qantas hosting its first loss in six years and warning it will not make money in the next financial year. 2000 after retreating on the fed minutes. The index going since jumping the most since june on the fed. One analyst said he does not think positioning is stretched, but even with broad dollar weakness, asian currencies have underperformed, but record forex reserves are one key reason. Steady afteryuan retreating from a sevenmonth high, retracing gains it has seen since last month. Focus, callsira in for the central bank in turkey to see rate hikes, but we have that decision in limbo given the pressure on the central bank. Haidi we will get more on the fed. The central bank tempering halfmism over second rebound. From our more analysis bloomberg economist. , how did you read this and what are the expectations for a policy rebound . Andrew thank you. Came out in late july, so we have had a lot since that meeting. The dovishness on the economic front is pretty well understood. Unemployment, subpar inflation, but risks in the u. S. And around the globe, but where markets expected more is some clarity on the future policy course. Ae fed has been involved in review of its tools and framework for over a year, predating the recession, trying to figure out how to get inflation sustainably higher. We think some changes are coming this year, but represent an evolution, not a revolution. We think yield curve control, where they decide to go further curve looks unlikely, and more so after the latest fed minutes, but we think they will threshold onto a unemployment, Something Like 5 . The economy will need to hit rates, not lifting occurring until 2022 or 2023, so an extended period there. It is more that the market has no clear sense that the fed is willing to commit to extra tools. What about the fiscal stimulus negotiations in washington. How do they incorporate that into their thinking . Andrew sure. This snapshot did involve a time when negotiations were at a high point, but we did not get a clear extension of fiscal measures, including Small Business aid and an extension of unemployment benefits. Ofgot a stopgap measure executive action still being implemented, so the fiscal stimulus front is undershooting what the fed was expecting, so how it will approach its next meeting in september, there will be less positive news, pointing to the need for more action, but improving signs, like a drop in jobless claims, so as we get into the back to school seeing problems reopening. We will know more in the september meeting that it did in july, adding more seeing uncerty markets moving forward. Shery apple hits the 2 trillion mark. We will discuss, next. Plus, earnings for aia. Ur interview with the ceo he is widely credited to lead the rise to be chinas top insurer. This is bloomberg. You are watching daybreak asia. The u. S. And china revising talks, after a conference was called off. Sources say the review will happen soon, although a precise date has not been set. President trump said he killed the talks. It never made it onto the official agenda in washington or beijing. The u. S. Is stepping up opposition, terminating three agreements with hong kong, the surrender of fugitives, transfer of convicted people, and tax exemptions. The state Department Says it indicates the concern over beijings growing influence in hong kong and the control over legislation. The uae says plans to establish notal ties with israel will salvage a plan will salvage a plan, normalizing relations c, saying it is a Natural Evolution of reality. It is seen that all but ending hopes of a palestinian homeland. The eu is rejecting the Election Results in belarus, stopping short of calling for a new vote. Several leaders say they have been able not been able to reach president lukashenko by phone. There have been warnings from moscow not to interfere. The eu claims that the vote was neither free nor fair. Global news 24 hours a day on air and on quicktake by bloomberg powered by more than 2700 journalists and analysts in more than 120 countries. Shery apple becoming a to trillion dollar company. Trillionght 2 company. This is the latest example of the rally in tech stocks driving markets. , aaronow from pimco brown. Great to have you with us. Rallye seen this recent that seems focused on tech stocks and people say we have not seen Something Like this dot com days. What do you say . Thank you for having me. You have to look at the tech sector delivering. Is higherech sector on higher weight of global indices, over 25 percent of the s p 500. When you look at the profits out of the tech sector, they are contributing a larger percentage in terms of total profit share at ae market, growing faster clip. The return on equities is twice that of the rest of the s p 500, so d accelerated move and continued appreciation is justified given the profitability they are delivering. What about the backandforth between the u. S. And china, will that have an impact for Tech Companies across asia . Do have to be specific in terms of the exposure you are taking. Certainly there are headline risks ahead, and you will see think u. S. Take a harder stance against china, and the tech sector is in the crosshairs of that reciprocal action we will techbut by and large, the sector specifically in china is largely servicing the chinese economy, and for those domesticallyoriented technology names, they are fairly well insulated from falling and the crosshairs of u. S. China trade tensions. Shery i want to get your s positions. M a lot of people are saying we are seeing momentum, dollar iskness, but the euro region seen to recover quicker than the u. S. , so bullish on economic prospects there as well, so why do you prefer the theme of u. S. Exceptionalism when there are so many problematic factors with how the economic rebound in reopening story plays out . Erin it is a great question, one we have been discussing internally. I will separate it. Segments like certain of the emergingmarket asset class, but we like her currency duration, rather than equities rely onhich largely strong Global Economic growth in order to outperform, so why do could see temporary emergent area emerging markets outperforming, in order to have sustained emergingmarket outperformance, we will need to see a global rebound back to the levels we saw prepandemic, and we are not expecting that until 2022. While we are seeing a gradual itling of economic activity, is slow and will take time for the economy to really heal, so we would rather own duration assets in emerging markets, where we think there is good value, rather than owning growthoriented assets like emergingmarket equities. With respect to european equities, we think there is certain value in certain segments of european equities, but the challenge with owning european equities overall is the index is heavily weighted in more oldeconomy sectors, unlike the u. S. Market, which is a techoriented, new index, so certainly it makes sense to own certain segments of the european services, even some European Industrial companies. When you look at the composition of the market overall, we think it is disadvantaged given the sector weightings within europe given the u. S. Market. Shery we have to haidi we have to leave it there. Holding fire on leverage loans and other areas that have benefited from government onervention, the ceo of company said there will be reckoning if asset prices dont reflect reality. This is an unprecedented time in terms of the fed and its comparables outside the United States and governments have intervened in markets, so that has divorced the actual assets on the ground, so we have triaged the market, looking at areas where the actual facts of the matter upon the ground are showing through. And so, i would divide that into credit,ike oil and gas transactions in aviation, retail, and Small Business lending in north america, where basically the damage has been so great that it has begun to kind of move independent of what any Government Agency or anyone else would seek to prevent. They are other areas like real estate loans that are just beginning, the real the effects of not only the asset bubble weve had over the last decade, but also the adoption of technology in the way we work and live, and its effect on commercial real estate is just beginning to show through. On the loan side in the Second Quarter, we have seen Bank Earnings move to reserves, and we will see more with that with the expectation those loans will move along, along with properties, etc. And then there are things where we have not seen any movement in response to the facts of the matter, leverage loans, istgages, abs, rbs, and that just a question of time, after which there will be a reckoning. Haidi there are opportunities now, but will be a bigger opportunity down the line. Where are you holding on to your fire and strategically investing . Give us a little bit more detail. Dan we are certainly holding fire in these areas that have been particularly affected by the intrusion of the government into the marketplace. We think there is a lot of coming. The numbers are frequently very, very poor, and not likely to improve materially, but getmately people have to there before investmentgrade owners of those securities want to sell. On the other side in oil and gas credit, it has been tough for the last few years, march was the final straw. You are seeing her assets in and oil andorth american gas levels that are favorable, compelling, and dont require any view on oil and gas prices, which we have none anyway. As you noted also, retail is a big one. Obviously the experiential aspect has been taken out from retail. Pool ofit as a intellectual property and real estate that really fundamentally need to be restructured, so we are involved in lending against the collateral, liquidating that collateral, and will be several years of that to go. When will we see the next leg lower . I know you mentioned this will go on for what could be years, but surely there will be a hit to the consumer without more stimulus, and soon, and that will cause another round of bankruptcies or what have you. Dan well, it is interesting. Since covid and government intrusion, when we look at the aps and consumer behavior, we have largely seen material over performed to what we expect, and that is because a number of people are receiving aid not likely to persist indefinitely, so the reality is that none of us really know what we call the undisturbed consumer looks like, and certainly the security backing up those obligations take into account virtually none of the probability or conditional probability that could take a leg lower. Up next, oil at a fivemonth high, as members are urged to comply with output cuts. We will get a look at were crude is heading next. This is bloomberg. S bloomberg. Shery a quick check of the headlines. Said to ben china is facing issues. It has a joint venture with bmw in china. One of its bonds tumbled 35 . Million in pay 200 outstanding bonds this year. There are questions whether the company has the financial ability to do so. President trump calling for a aftert of goodyear, maggot apparel was shown as being unacceptable. Apparel was shown as being unacceptable. One group has frozen half of the 900 million it wired to revlon creditors. That one 127 million entity is refusing to send back. The same judge halted 170 4 million at the gate capital. Citi is suing all three firms. It wired as some more than 100 times two big. Big. Slipping, this foil slipping, this after the fed tempered optimism. The outlook for the market remains fragile and uncertain. Is on theoil trading line. What did we hear from opecplus . Thanks. Great to be with you. The meeting was very interesting. We had saudi arabia and russia coming together, showing how they are complying to the curbs, sending this unified message to other producers. There is concern there will be cheating among other countries, especially like nigeria and iraq. The big question is if there will be cheating by those producers, will saudi arabia and russia join, especially with prices at these levels . In the meantime, what is the demand side of the equation looking like . If we use todays meeting has guidance, russia says the oil market remains fragile, a lot of uncertainty ahead, showing the pace of recovery has been slower than expected with covid. Arabiasave Saudi Energy Minister saying oil demand could return to 97 of prepandemic levels by the fourth quarter, so that is sitting that is encouraging to me. We will have to wait to see if that happens. See a we started to slight presumption that u. S. Shale returning to exploration as well. Are we expecting exploration to return in full . With quail around 40 a barrel, a lot of producers can ramp up, especially if prices stay within this range and moderate in the mid 40 a barrel range that would be a concern for opec, going to all this up, thatnd shale ramps cookie problematic, right . That could be problematic, right . Haidi yes. Since 2010. The most the chief executive and president joins us next. This is bloomberg. Haidi a check on the first way it this ally. Onto therris stepped stage as the potential Vice President and layout why the democrats should win in november. And sharing the spotlight with former president obama, senator warren and nancy pelosi. The u. S. Remains the focus of the coronavirus pandemic, but that there are signs infection rates are starting to slow. They arelso indicating easing. Hong kong has reported the slowest number of virus cases since the latest outbreak, as low outbreak. Mid july. 60 in they are considering extending the state of emergency to prevent a new wave of cases and three months without a local infection. China is facing its highest level of flood levels. What is expected to be the biggest surge in four decades. They have suffered severe flooding since june. It has caused around 26 billion in can in damage. Most sinceing the the insurer went public in 2010. It has made it harder to meet prospective clients. The key measure of profitability slumped 38 . Lets cross over to hong kong where yvonne man is joined exclusively by the chief executive. A familiar face on bloomberg tv, a former ceo. Ceo atthe role of another company. First and for your first interview since joining the insurer. Good morning. It has been a wild. Lets talk about the first half. It was a tough period. You are dealing with more restrictions on the region. Tell us a little bit more about what you are seeing in terms of Business Value growth. Signs of aing bottoming out now . Yes it was a very challenging first half of the year with the whole world on lockdown. In the context of this environment, it was down, but we see a strong recovery in the months of may and june. The momentum in china, vietnam, even in markets like thailand,. Ndiana the men tell him that we see the momentum that we see has been quite encouraging. Yvonne china is perhaps doing a little bit better. Given the signs there situation that we are seeing their . Yes. There. Yes. China came out of the pandemic little earlier. Year on year, month on month growth. Recovered tomuch precovid levels of reduction. Yvonne tell us about the dislocation that you are seeing. Just given the challenges of the pandemic, how have you had to adjust, in terms of how you hire people and how you are living around now. We have digitalized most of our processes. High. Very for example, in singapore, even after coming out of the circuit of new, the proportion business coming through digital or remote selling remains at a high level of 80 . , all they high business is coming through inward selling. 99 comes through remote selling. Your business was done remotely. Do you see this as a sense of a permanent change in the industry . Complicated planning process for the future. Out, and agents are able to see the customers we see in china a reversion. Yvonne you obviously had the chinese experience and you have this enthusiasm for technology. How do you see the technological side of development . Do you want to be a leader . Yes. It is a very different company, a great company. It has done a lot. It is very focused on the use of technology to power business. Transforming our technology to much more cloudbased to allow us high levels of automation to achieve 90 . The whole Customer Experience will be transformed. Yvonne there has been talk about stock connect being wellconnected and insurance connect has become a buzzword. What shape or form do you see this initiative taking shape now . What did markets need to do to be ready for that market flow . Seeingially, what we are in the set up there are a lot of mainland customers who like to buy hongong kong kong companys insurance, with the restriction at the border. T is difficult for them will help these customers. Yvonne what do we need to regularly see in order for them to open the doors . . Ow does it affect affect you and what you do on the mainland . Premises within china. The unique in the sense that we are 100 ownership. We do not have to share any of the economics with a local partner. Whether the customer buys from hong kong or on the mainland, we get 100 of the economics of it. Yvonne what kind of factors do you look at when you try to expand . Do you look at geography or distribution platforms . Have seven major. Rovinces in beijing these are the geographies that we are operating with now. We can go to more provinces. In china is like a midsized country, so we are on 10 to 12 new provinces in the near future. They are talking about hundreds of millions of customers. We have seen new Business Value theyre continuing to be sluggish. With the National Security legislation coming into effect, what considerations do you make for companies . What are you looking at now to stay resilient . We are headquartered in hong kong. We remain very optimistic about hong kong. We are an asian focused company. Kong, it hast hong the best business and environment, compared with the operating inare the world. Remains good for businesses. Yvonne do you think, if they relax restrictions he took a lot of your business from mainland visitors. Do you see those mainland visitors coming back the way they did before . Perhaps some of these offshore customers will stay away now . Last 16 years, i was in shenzhen. Companies hong kong remain price competitive, compared to production in china, the mainland chinese customers the borderoject when will open. Of mainland chinese customers. I know that they come over. Last question. Do you see more opportunities post covid or will it be different . Very strong financially. We are always looking out for opportunities. Looking for investments to make Financial Sense to us. Yvonne thank you so much for joining us. Bacteria that is. There great conversation with the eight the group there. Coming up next, a preview of alibaba earnings outlined today. Acing rising threats now President Trump is adding to the risks. This is bloomberg. Shery demand picking up in china following the lockdown. Stephen engle is looking at what to expect and joins us from hong kong. Alibaba faces a series of challenges and the possibility of an attack from President Trump. Stephen challenges at home and abroad. Getting back to those prepandemic levels of sales, but abroad, trump orders on the. Ikes of tiktok and we chat especially alibaba, which is listed in the u. S. And in hong kong. President trump has threatened more action. That could put alibaba in the crosshairs. Ross is a, wilbur secretary, he did say alibaba by name is not on the list right now and is not being targeted. They are focusing on to talk. Down to other pressures, warning universities to be wary of endowment funds because of the possible delisting issues that could come down the pike. There are issues in the cloud they are planning to hire 5000 tech workers globally by the end of this fiscal year. It is trump has signaled a National Security threat. A lot of challenges abroad. What do we expect from earnings . Stephen alibaba Revenue Growth plunged to a new low. Top line growth is likely we accelerated, but not necessarily the prepandemic levels. Intelligence is expecting yearoveryear growth. That is the consensus estimate there. Alibaba is wellpositioned. Multiple purchasing and shopping platforms. They have logistics in warehouses. But facing steady erosion in the commerce from smaller competitors. They have also capitalized greatly in the surge on Online Shopping. Chief Asian Correspondent dan with what to expect from alibaba reports. Setting up ahead of major market. Sophie. Sophie anticipating some downside. Down by. 4 . The bloomberg spot Index Trading study after the biggest jump since june but still trading around 2018 lows. Gold is treading water with prices around 1930. The board, we had highr rising to a twoyear , as well as strong chinese demand. That is a trend that we have been seeing. Further gains for chinese material stocks, which has broken a downtrend that has been in place since 2007. A busy earnings day so far. That coppering us is set to win in a postvirus world. The stock has been rated by some analysts. Downgrade to hold on minerals. Lossd see a firsthalf net given the oil about that we saw during the period. Annual profit, but higher expenses and announced a final dividend. We did have the carrier report the first loss in six years, but the Australian Airlines said had enough liquidity and assets to whether the crisis. Shery we will have more on all the earnings, net. They will be joining us and they continue to drive the aussie benchmark. This is bloomberg. Shery apple is writing wall street history by becoming a 2 trillion company. Investors are lacking its adoption of internet devices. Each 1ok 38 years to trillion but only 24 months to double that. Of the index of smallcap stocks. Airbnb has submitted a draft form. It is expected to take place after the fcc completes review process and will be subject to review conditions. Listb says it is ready to as it reemerges from the coronavirus. Chinas Biggest Offshore Oil and wrote down driller half a billion dollars in assets, mainly in north america. Income fell to 1. 5 billion. Boostre under pressure to domestic output to ensure security. Are watching stocks in some of the Biggest Companies. More on bloomberg equity markets reporter. We had us giant stocks closing on some optimism. What are you looking ahead to today . That is right price action in the Australian Market has largely been dominated by earnings and we have had quite a number this morning. It is one of the Biggest Companies to report. They flagged a recovery would choppy and take time. Strong retail growth experienced in the secondhand through july. We heard from santos, which maintained its outlook guidance for the year. There is certainly a lot for investors to digest. Shery and we had bearish remarks as well. What are we expecting . The concerns about economic recovery will have some impact on investor sentiment. There was a slew of Company Report that came out as well. Pleaarket has been trading pretty flat. It will be interesting to see if it gives them a better direction, going forward. Haidi are we starting to see a tle more rotation into potentially some of these beatendown sectors are made for a recovery as we get into a reopening story in australia. It is hard to say. It seems like every day, it has been back and forth, up and down. They are weighing a lot of information at once. If at been hard to say home trade has accelerated. It is something that we will keep an. An eye on. A big lineup of ceos after earnings today. Later we will hear from them. Nextthe ceo joins in the hour to discuss the outlook for the travel set there. We will also have more perspective and another exclusive interview. Looking. Com has nearly 30. Illion reported listings pace ofd, chinas recovery appears to be slowing, putting easing back on the table. We will discuss the outlook for rate. Haidi of course, we are looking likely to stay unchanged in reference to the rate. This is setting up for the rest of the trading day. A moderate downside. Looking like we are getting off to a cautious start. We are seeing nikkei futures up i about. 5 . It continues to be the leader when it comes to performance this august. Like there looking performers as we get this sense of caution. A great degree of trepidation. We had looking at that pullback for the dollar. A lot more to come in the next hour of daybreak asia. This is bloomberg. Shery welcome to daybreak asia. I am shery ahn. Our top stories this hour, asian markets are set for a cautious start. Tentative optimism. Onovery is dependent containing the outbreak. Alibaba will report in new york later. However, more challenges may be may be,ser, much closer to home. Kamala harris will lay out why she thinks the democrats should win in november. To thelets get straight Market Action with sophie kamaruddin. A look at stocks trading in tokyo, we are seeing the nikkei 225 looking to test that level. We are watching a fiveyear sale, which some say looks recently priced. We are seeing that curve flattening. Taking a look at what is happening in korea. 7 . 10 of 1 a concern about infections for south korea. Over in sydney, retreating from a five month high with plenty of earnings on watch. 72 after the biggest drop for the currency since august 7. That decline is more of a pothole, given the rising commodity prices, plus we saw copper jumping to a twoyear high. Lets check in on u. S. Assets. Moving to the downside, the dollar is study. But the downward trend might be hard to shake off with the nikkei trading around 2018 lows. After seeing a shift spiking overnight, showing little interest on yield curve control and gold is under pressure, Holding Losses below 2000 an ounce, after we saw those fed minutes warning about a rocky road ahead. Haidi adam joins us now. Changed really perceptions when it comes to control. How does that play out for asia and em assets . I think it was a notable change in language, participant particularly the idea that it was moving into yield curve control territory. Nature of the commentary overnight, there was a damper on that. There is still that argument to be made that a lot of emergingmarket assets in this part of the world, across asia is particularly interesting at this moment. They want to take a bit more risk with equities, so there are still pockets of emergingmarket after, growth and debt the latest commentary from the fed. Are seeing a little bit of Dollar Strength right now, but it goes into the broader debate about the weakness in downtrend and whether it is here to stay. How is this impacting across the world . It is still a core thisderation with protracted area of weakness. A lot of them have not had to it ise too much with that making it a bit more of a challenge, so the likes of the japanese equity market is still looking like it is somewhat troubled by continued dollar accompanying strength in the japanese currency there. A lot of underperformance in the u. S. There. In periods where you see the soft dollar, look back at history and there are reasons to believe that you have good outperformance. If you want to stay in that bearish dollar camp with this ,ontinuing in emerging markets it is about how economy is playing out with covid19. That remains in uncertain future. Haidi a big earnings day. Willere anything that rebound . , it hasny ways confirmed what investors already knew. Clear on the more pain ahead rhetoric that we have been hearing for some time. Still talking about the middle of next year for opening these flights from australia. Some increase in retail sales there. They are seeing that continuing through july. There are reasons to be optimistic about the story, but from the enough pattern that we have been seeing, recently. That picture could change very quickly. Haidi adam hayes in sydney. They came out with not a great deal of surprise, but certainly its first loss in six years. It will not be making any money in the next financial year. We are taking a look at the start of trading at the moment in sydney. Asy also declared a net loss well as saying they will not see International Routes until july. Why we aret is seeing a muted reaction in trading. It is worth mentioning that out of all of the asiapacific carriers, it is mind quite positively by equity Analysts Covering the stocks, largely because of the exposure to the domestic market. Expand the to domestic market, given the current absence. We will speak to the man himself. Alan will join us in just about minutes time. Is due tod, alibaba report earnings today. We will be discussing the outlook. Signs of the pace of the recovery is slowing. Next. More on that, this is bloomberg. Shery gaining ground for a third session. It is now at the highest on record after annual profits climbed. We have seen the lockdown boosting inhouse consumption. They had some writeoffs, that they decided to pay special dividends and now wesfarmers i gaining ground at the highest level on record. Of course, this is the peak of earnings season. Theye getting a look after came out with earnings in the last hour or so. 2 after they beat estimates. That is still down 81 , year on year there. A full year of net loss versus profit of 189 million just a year ago with that final Dividend Per Share of one cent. Speaking to the ceo a little later as well. Mitchelln to karina with the first word headlines. The u. S. And china are set to be in a set of talks. Sources tell us the review will not happen soon. A precise date has yet to be set. Neverwed net actually made the agenda. The u. S. Is stepping up opposition to china, terminating three agreements over the National Security law. It covers the transfer of convicted people and reciprocal taxes on shipping income. It indicates the concern of a beijings growing influence and control over legislation. Tosident trump plans reinstate sanctions after a heavy defeat at the Un Security Council last week. Mike pompeo is set to greet global sanctions were eased under the nuclear deal that President Trump abandoned two years ago. This is bloomberg. 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. Im karina mitchell. This is bloomberg. Expect the rates will stay put this month. The economy out of its First Quarter contraction, but the recovery remains agile amid tensions with u. S. They have not really moved since may. What are you expecting today . We expect it to be unchanged say. All of this interest, below probably see this year. The rationale behind it, if you look at secondquarter policy report, the key difference between that report is that only Monetary Policy they are no longer talking about the need to strengthen adjustments. The reason for that is if you look at what pboc has been doing , there is always a need to balance. Growth isy to support no longer as urgent as you mentioned earlier on. That chinasght economy in the Second Quarter has already gone above and returned to precovid gdp levels. You can see a realtime indicator into august. The gradual recovery continues to be underway. Domesticsales, flights, year on year, they seem to be showing and improving trend. Injectingdid see them liquidity into the market. Lily see a continuation of that trend . I think the open market what we think pboc will be doing is on the fiscal policy fund, there has been and continues to be easy. Come to around 15 of gdp this year, which will be up year. 0 last in order to ensure that it does not crowd out the sector, they will inject more liquidity. Hat will be the reason why the growth will probably maintain year on year for the remainder of this year. Haidi when do we expect to see a retail driven recovery in china . I think it is already underway. If you look at the growth , initially we had a lockdown and then the supplies resumed, particularly on the manufacturing front. Now is when the consumers are starting to come back. What they seem to be suggesting is that Services Demand on the consumption side by the end of august probably be back to 85 levels. F the consumption is already happening. The other indicator is if you look at messick tourism, that seems to be rebounding nicely. Not over spending in china, which Morgan Stanley has been highlighting for a. That has been almost a 60 jump in the stock market in china. I think maybe i should put it this way. There has been a pickup in retail participation. Would just say that if you look at the household sector Balance Sheet writedown, Equity Holdings for the chinese household are probably not as big as what we see for other economies. What kind of policy easing measures how much the policymakers are giving to the household, employment better inose will be terms of whether the country in terms of driving consumer recovery. Haidi we always appreciate your time with us. A series of highprofile stock listings have helped hong kong post a record profit. Is for years to come. He spoke exclusively with yvonne man. A really happy day for us. He announced record earnings. Yvonne talk about the pipeline. It has been strong. Now you are preparing for financial. That part of our life continues. You have one big d. L. And you just keep on going. Yvonne do you get a sense that this is more than a 2019 and 2020 story . Is coming from china, all over the place and for years to come, but in terms of Large Companies already listed, to the extent that they want to come back but have another listing, that is a limited number, but we are talking about hundreds of companies with hundreds of billions of dollars. Still a lot of great opportunities for earnings. Very Successful Companies that are listed in the u. S. It is much more about treating, about active anticipation by the connect particularly strong. Cannot be happier and grateful, given what is going on. You cannot ask for more. Tensions arerade on multiple fronts now. We heard the u. S. Morning university to divest chinese stocks in the u. S. And you have the threat of these companies being delisted. You have hong kongs special trading status that has been withdrawn. How are you viewing this rivalry now . We are experiencing things we have never done or seen before. Everybody is trying to make sense out of it. Really think about what the impact will be or how it will go. Everybody will have their own opinion, but i am guided by the wisdom of the market. The market is always the smartest. It is the place that can really digest and make a decision. Yvonne how do you secure your position and welcome these ipos that have been listed, coming back home, while also safeguarding yourself from attacks in the u. S. . Sure thatt make anybody who wants to participate in the market, you take the barriers down, make sure you are the most efficient. You allow everybody to intersect. In the end, they always have to deal with political situations. This is not the time. We are very short of that, but it also creates opportunities and volatilities. , everybody wants us to succeed. To win. Y else is going just have to keep our eyes open and sometimes the storm comes. To the extent you are able to make any changes, you try, but sometimes you cannot. Sometimes you have to brave it. Well have plenty more on daybreak asia. This is bloomberg. Shery democrats will have a starstudded lineup. She will be alongside a number of speakers. See somes now, you can of the most powerful women in the party will be speaking tonight. Absolutely. Clinton, Nancyy Pelosi and you also have, following on the heels of harris, you have barack obama. It will be quite the lineup. Haidi what are you looking out for in terms of this spectacle . The representation that is being made by individuals speaking on behalf of the party. What is important in terms of taking away . Think number one tonight is introducing harris and letting us know who she is. The other thing is how they are going to govern. Issues,ook at several from the economy, climate change, trade and Foreign Policy , how are the democrats going to govern, if they get into office. That is not particularly clear. To see theontinue crisis. Even if we get that resolved, how damaging has that issue been on voter confidence . I think it has been very damaging. It is fascinating how Many Americans care a great deal about the Postal Service and to protect their right to vote. Isy people i feeling that it not as secure as they believed it would always be in the u. S. Will have a lot to say about that. What was the value of the convention being held in a virtual format this year . Choice,did not have a and i think they were able to get their message out without a lot of pushback from disgruntled members of the party, so we bill from colin powell and clinton. They have been able to control the message in a way that they would not have been able to had it been live. There are drawbacks to doing it in a virtual format as well. We will have special coverage of the Democratic Convention at 10 00 a. M. Hong kong time. This is bloomberg. Hike Simon Pagenaud takes the lead at the indy 500 coming to the green flag, racing at daytona. Theyre off. In the kentucky derby. Rory mcllroy is a two time champion at east lake. He scores stanley cup champions touchdown only mahomes. The big events are back and xfinity is your home for the return of live sports. But what if you could stdo better than that . K. Like adapt. Discover. Deliver. In new ways. To new customers. What if you could come back stronger . Faster. Better. At comcast business, we want to help you not just bounce back. But bounce forward. Thats why were helping you stay ahead and adapt with a network you can count on, 24 7 support and Flexible Solutions that work wherever you are. Call or go online today. Shery a quick check of the markets. Minutes a bleak picture for the economic recovery. We are seeing the nikkei falling for a consecutive session. We are seeing energy and utilities leading the decline after the market gained yesterday. Coming off the highest levels since march. We have a slew of earnings, about 40 of market value reporting this week. We will talk to the ceo later today. Quibi stocks are also falling. Kiwi stocks under pressure yesterday and we are watching out for more earnings out of asia. A look at theake first word headlines. A focus of the coronavirus pandemic, but there are signs that infection rates are starting to slow. Someda is also indicating i easing. The u. K. May test passengers at airports and france reported its sincet infection spike march. For the past six days, such cases have not passed 35 . Extending or considering the extension of a state of emergency through next month. Geminis leading aviation body a resumptionallow of fights between the u. S. And europe. Would require passengers to produce a negative covid19 test for boarding. A billiont over dollars before the virus shut aviation down. Level the largest ever 2. 5 million cubic meters of water is expected to flow into the giant reservoir and what is expected to be the biggest surge in decades. Severe flooding has affected people and caused about 26 billion in economic damage. Reporting. Amanda is picking up in china following the lockdown. Andhen is watching this alibaba still faces challenges. One of them could be a hardline stance coming from the u. S. Stephen that is right. Alibaba faces challenges at home assuagead, trying to the fears of investors after the markets closed today in hong kong. They need to address the issues at home, where they had significant dropoff in revenue at home, during the lockdown. I will get to that in the earnings preview and a second, but the bigger threat is the geopolitical threat. Alibaba has not been named by the what house in their targeting of chinese tech firms hallway and huawei. But he is actually saying other chinese Tech Companies are potentially in the crosshairs. We heard from wilbur ross saying right now, alibaba is not being targeted, as they are focusing mostly on tiktok. Donald trump has talked about the National Security threat that they have with cloud services. We know that alibaba has pledged u. S. Vest 20 billion dollars on infrastructure, including data centers, hiring about 5000 tech workers globally for that division by the end of this current fiscal year. It is a challenge for alibaba to grow beyond its business in china, into the u. S. And elsewhere. There are a lot of challenges. Challenges from the fears competition domestically. We know that alibaba is a juggernaut. From the multiple purchasing and like,ng platforms and the they have their logistics in place, they have warehouses and payments in place, Online Shopping and delivery. They have that down, but the problem is, the competition has used the coronavirus to double down and go after alibaba. You are looking at these and others and then you have the purchasing,ting and from the likes of tiktok, tencent and we chat. Many have been getting their products sold through other online platforms, not just the traditional online ecommerce. Still, it earnings in the fiscal First Quarter, through june, the consensus is for an increase year over sales growth up 29 after 22 gain in the fiscal fourthquarter. To three pandemic levels. They are getting a pickup right now as the chinese economy is recovering faster than most places in the world. Had annual singles day coming up as well. I am wondering, given that alibaba focuses on discretionary, how much power is there on margin and people spending on the others of the pandemic . There is pressure on the margins. I was looking at a preview for the earnings and they were talking about Crisis Support measures put in place to help merchants weather the storm. They have been given a lot of subsidies and waivers and that is likely to drag down margins. You have seen the grocery delivery business, which basically translates, are you hungry . They are hungry to grow the business, but it is a highly competitive one. Stephen engle that with the latest on alibaba. The grouphear from ceo on the back of his earnings report. First loss in six use and predicting significant losses. We will discuss. Shery looking at ways to reduce the amount of debt to attract more investors. Moreng us it would help than simply delaying payments. Urgency is for growth and reduction of poverty. Countries need new cash flows, new investment and one obstacle to that is the debt burden. If you are a new investor and you know your money is going to go to help pay off old debt, that creates a optus an obstacle. We are trying to find relief from the debt service, meaning the payments that they have to make. These are the poorest countries in the world who do not have the resources to fight covid. Also looking at reducing the stock of their debt, which would give light at the end of the tunnel. You and i know that stan fischer we know the work when he was at citigroup. Is it the same policies and procedures as from another time and place, or are they working with a new, different formula, a new, different process . It is different. Wass doing well and involved in many of the previous debt restructuring. Those were syndicated loans. They had a different restructuring process. Dynamicortantly, a between creditors and debtors. The banks needed the repayments in order to maintain equity capital. Basically, beginning into thousand four or so, there has been a huge buildup of debt in the poorest countries, coming from china and private sector creditors. Difficult. Ore the dynamic has shifted in favor of the creditor. The problem this causes for new investment is the creditor is sitting there and that creates a big challenge in terms of creating light at the end of the tunnel for the poorest countries. You have a phenomenal box chart of troubled nations and their relationship with china. I hope you come back to bloomberg surveillance after my rudeness, but how intrusive is the Trump White House in their negotiations with china, for you at the world bank to have a constructive workout of troubled nation debt with china . How much is the Trump Administration get in the way . I would not frame it that way. The u. S. Might have issues with but the world, separately recognizes that we are all trying to Work Together to get growth in developing countries. The challenge is over the last 10 years or so, china has made many loans to developing countries with terms that are not transparent and that are higher in Interest Rate in the countrys can afford. The challenge is somewhat a technical one for the whole world working together, working to find a way to get through this. China needs to participate. They said they were fully engaged, but getting each of the lenders, there are many official lenders, but getting them each on board is a challenge. Was speaking to tom keene. We are hearing from south korea s finance ministers saying the Economic Uncertainty is rising on virus flareups. Toea will decide whether extend financial rules. They eased foreignexchange liquidity rules through september, in order to provide more dollars in the currency market. Now we are hearing that korea could be deciding this month whether to extend those financial rules. Lets take a look at some of the stocks that are gaining in sydney. Education is but one of the is one of the biggest the Company Provides students placement services. Highs andesh expecting double four year earnings. To alibabasan day. Es the casino operator rising despite posting a net loss on the year. We are also potentially watching qantas. In widert loss came than expected. Profitng a 93 drop in with stock down more than 6 . Falling after reporting weaker profits. Was 5. 5 billion aussie dollars worth. Still ahead, we hear from qantas group ceo. The first loss in six years. Predicting losses in the next several months. This is bloomberg. Shery chinas Biggest Offshore Oil drillers saw profit tumble in the first half. Mainly in north america after crude prices collapsed. About 1. 5fell to billion in the same period last year. Chinas oil majors are under pressure to boost domestic output to ensure energy security. Posting a 69 fall in profits reflecting a spin off in the previous period. Excluding theut sale of coal, it was up 8 . They declared a special dividend on that sale on bringing the full year dividend to a total 62 per share. The value of new business in the first half fell the most since they went public 10 years ago as the coronavirus made it harder for sales agent to meet prospective clients. 38 to 1. 4 billion. The bad run began with a protest in hong kong. Lets take a look at how markets are shaping up. Pretty muted from wall street as there is a more consuming consenting fed minutes. Recordsaid that closing at the start of the pandemic but we are seeing a dismal picture here in asia. Despite a number of analysts adding optimistic on japanese equities, it is still the apra former in the month of august. The kospi reverting some gains. We are seeing steep declines when it comes to financials, utilities and it is Just Health Care that is really in the green when it comes to the south korean session. We are in the thick of earnings season. About 9 10 of 1 with applications for corporate australia amid the uncertainty of the pandemic. Shery investors have to digest what we saw in the u. S. Bleaknutes painting a picture of the recovery. U. S. Futures falling already. 500, all 11 p sectors dropping lower. Rebounding. Ollar Holding Steady at around those levels, but we are seeing futures under pressure. 25 percent. It is not just the fed minutes painting a bleak picture. Are nothe fact that we yet getting another u. S. Stimulus package and the ongoing escalation of trade tensions. We will see a resumption of those talks soon. As we all of this continue to get closer to that november election. Ite in asia, we mentioned fell the most since the insurer went public in 2010. They spoke exclusively to yvonne man a little bit earlier. Resilient set of results in this environment. Were seeing but we strong recovery. As the markets come out of in china,the momentum likeam, even in markets thailand. The momentum that we see has been quite encouraging. Yvonne talk about the dislocation that you are seeing. Just given the challenges of this pandemic, how have you had to adjust in terms of how you hire people and people moving around now. It has given us an opportunity to digitalize more of our profit. Is very high. For example in singapore, even after coming out of the circuit of new, the proportion business coming through digital or remote selling is still at a high level of around 80 . It is very high. Practically all the business is coming through you. 99 comes through remote selling. Yvonne 40 of policies were done remotely. Overall. D. C. That as a sense of a permanent change in the industry complicatedis a training process, training for the future. As markets come out of lockdown and we are able to see the customers facetoface, we see in china, a reversion. To focus on hong kong as well. We continue to see business very sluggish. With the National Security legislation coming through, what considerations do you make for companies . What are you looking at now, to stay resilient. We are headquartered in hong kong. We remain very optimistic about hong kong. We are an asian focused company. I think, if you look at hong this it has the best is and operating environment, compared with many of the world, operating in the the Business Environment it is very good for business. Yvonne even if they relax mainlandons, do those centers coming back the same way they did before or perhaps some of these offshore customers will stay away now . Years the last 16 years i was in shenzhen. As Hong Kong Companies remain price competitive , the mainlandina chinese customers will come back. Project when the border will open. ,s long as the dynamics remain mainland chinese customers will come back. Ceo speakingas the exclusively to yvonne man in hong kong. We have another interview coming up in the next hour. We will be hearing from alan joyce on the back of earnings boards. Predicting significant losses over the next several months. More on the impact across the booking. Com later today. We will be discussing markets ahead of the open of mainland chinese markets
vimarsana.com © 2020. All Rights Reserved.