Transcripts For BLOOMBERG Bloomberg Markets Asia 20240711 :

Deaths, and germany reports is highest fatalities since april. Brazil is resuming trials of chinas vaccine amid claims the original was political. Joe biden held his first calls with political leaders in tokyo and ellis and dolores seol. And calls for stronger twoway ties. He also wants to meet biden as soon as possible. Korean president moon called for a stronger aligns with the u. S. And said they agreed to Work Together on the virus and climate change. Financial markets in the philippines will remain closed as another powerful storm heads across. At least one person has already been killed. Currency and trading has been suspended. The typhoon is the 21st storm to hit the philippines this year. Winds gusting to 250 kilometers per hour. It is then forecast track towards vietnam. Global news, 20 four hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. Im Karina Mitchell, this is bloomberg. Lets get a look at the asian markets. They are trading higher right now. Inching up. Rising for a ninth day. To a record close high. Up more than 7 this month. The ms asia index up. Worrying, investors about the geopolitical concerns, the implications of the prodemocracy leaders. Take a look at where we are, in terms of the fx market. Dollar index slightly lower. Close to two year lows. Forecasts have predicted a slide in the greenback. Heres how it is looking for Tech Companies in focus. Recovering from the losses we saw in recent days. Chinese tech giants have been hit, losing almost 290 billion of market value over just two days. Rishaad we are going to have a look at the situation in hong kong. It is facing multiple challenges to the economic recovery as the world awaits a vaccine that could help travel and tourism. Political tensions faced by the administration when it comes to turning things around. What thew tells us Legislative Council means for the economy. Think like any jurisdiction, the fundamentals must be constitutional, like what in our basic law is upholding the responsibility of both the executives and the legislature. I think you mentioned one that every into basic law member of the executive and legislative chamber will need to pledge their allegiance to uphold the basic laws, the National Security, and national interests. I think its a matter of security obligations. When people look at hong kong in totality, like many parts of the world, we are struggling against the pandemic, and fighting trying to come out of the economic recession caused by these external factors. David i think the initial gdp numbers out a few days ago indicate we are coming out of that. We are getting the final gdp numbers tomorrow. What is the messaging to the International Business community and markets in the event, and who knows where the political spectrum is moving, in the event that we dont have opposition on the political spectrum, which as you perhaps alluded to, the last 50 years has not been part of why the economy has been so vibrant, why do you think that should not be an issue . Remainink hong kong will a vibrant, dynamic every legislature, i think you would expect different voices, and it is also being done in the same way in the legislature. But there are basic principles that all members need to uphold. About thee ask Incoming Biden Administration into the u. S. What would you point to in messaging to the administration to argue and make the case that china hasnt, and hong kong hasnt simply become just another chinese city. What can you point to to demonstrate that . First and foremost, i think hong kongs message does not apply to a single country. We interact with the whole world. Hong kong is also a member of Many International organizations. In my area, the trade area, hong kong is a member of the wto with 164 other members. We trade with the world extensively. People who do business in hong kong will know that when hong kong is open and competitive, anybody can come to do business. I think in every jurisdiction, we need to tackle problems of our own, including our own constitution arrangement. The past two years, we have seen a lot of ups and downs, including the social unrest that happened last year, and challenges to our institutions. The point for is hong kong to deal with those situations. Seen from the future view, our legislature, we made a very important component in hong kong, where laws are being made, Public Finance sort of being the center of scrutiny. As government officials, every interactink we have to with our legislature, because there are checks and balances, which is fully enshrined and protected in the basic law. I think that will continue. On november 3wto over the china label, the Trump Administration is insisting on it, what does it mean for manufacturers . That order kicked in on november 10. It is more than just a . If we are talking about hong justto the u. S. , it is 0. 1 of hong kongs total exports. Is a is not sort of it matter of principle. Imagine a member of the wto enjoying a separate membership would be charged the right to with four other members. I think its the entrenchment of the right under the wto. Kong commerce and Economic Development secretary, edward yau. Come, chinas latest antitrust rules set the future mainland in question. We hear from a lawyer specializing in the market. This is bloomberg. Rishaad chinas raising scrutiny of Internet Companies overshadowed this years alibaba singles day. The Worlds Largest shopping binge reported sales of 75 billion dollars. That beat last years hole. We spoke to Alibabas Group Vice President and general manager. Chinese consumers are fond of foreign brands. Those from the middle class or people with strong purchasing power from tier one or tier two cities already have a big appetite for shopping. In light of the overseas travel restrictions imposed by the pandemic, i think we can see how your enthusiasm for online consumption during these this shopping festival. When do we get back to prepandemic levels of retail sales in china . Perspective,bas we are not only looking at online sales, but paying a lot of attention to offline sales. In offline sales has been very good, and has exceeded many peoples expectations. Offline has not reached prepembina prepandemic levels, but has recovered very well. For online sales, we have seen stronger growth in both Customer Behavior and brand participation. I think putting everything together, offline sales will recover to a better level in one or two quarters. But if we only look at online sales, i believe its already returned to normal. Tom china has unveiled new antimonopolistic regulations. Change inhis as a tee the way the government approaches Technology Companies and attempt to rein in the power of Companies Like alibaba. What do you think the impact of these new rules will be . We just noted this new regulation over the past couple of days. I think we will need to further study the draft. We will see later how we should accommodate this new regulation imposed by the government. I dont think this is a surprise. As you know, the Chinese Market is in the process of constantly regulating. Chinas government would like to regulate markets and engage in more Market Research in all sectors. Over recent decades, the Chinese Government has kept improving its law and regulations. We have been growing during this process. Tom weve also seen changes in regulations around internet finance, online finance, which impacted and improved the ipo. The concerns may restrict the ability to offer credit to some of the consumers, and Financial Transactions will be seen and have more oversight. What do you think of the impact of that is on your business in the ecommerce space . Platform, we have encouraged consumers to be rational with their purchases on the basis of meeting their needs. Alibabas Vice President speaking to tom mackenzie. All shares of chinas biggest tech funds are recovering, but beijings planned regulatory crackdown has made investors nervous. In the sector, ashares, lets welcome him to our show. Good to have you with us. What do you make of this clampdown . Thes live developments in world, concerns expressed globally, but the timing is surprising. First of all, thinks perh thanks for having me. As you mentioned, increasing regulatory attention on internet Sector Companies is not a china specific phenomenon. The second thing i want to say is this is not the first time chinese regulators have taken a particular interest in certain parts of the internet sector. Yes amr released these guidelines we are talking about. Invited 27st week internet Platform Companies to discuss practices ahead of singles day, and the same thing, the same discussion happened last year when it came to the ecommerce law and singles day at that time. So regulators have taken interest in the internet sector. Then when you have a look at previous regulations in the sector, cybersecurity law, personal data laws that came out last week, the ecommerce law that came out last year, and the various actions these regulators have taken against internet related companies, video games, whether it is the Payment Companies in central clearinghouse. Theres a lot of developments everywhere in the internet sector in china. When you look at these guidelines specifically, they concentrate on some key issues around for a while. Of products, the use of data, and how that affects the pricing. So a lot of things are happening, but not just in china, i would say. Timenda this comes at a when china is making Tech Innovation a priority. It was the balancing. But being contained at home, as well. That is a very interesting point. A couple of things i will say to that, the first is from a lawyers perspective, regulations can be healthy and encourage innovation. Not specific to china, but when we look at the regulations issued by the samr, it promotes a healthier ecosystem, increased competition, promotes responsible use of power. These are good things for the internet sector. The second thing i will say is china at the end of the day is a planned economy. And we have seen a lot of examples of the china government working hand in hand with the Technology Sector in different subsectors, whether we talk about general technology, platforms, social media, cryptocurrency, theres a lot of Different Cases where the china Government Works handinhand with internet sector or Technology Companies, that will continue. That will not stop. We still have a very positive outlook about how, what, when, and general outlook on Technology Companies in china, and what, why. Here, what dome the chinese authorities want to actually achieve . They have in act this dilemma that they face, what is the midline, if you will . Thats a very interesting question. When i mentioned china being a planned economy, the china government manages different interests and the actions they take. Sometimes looking at different sectors, sometimes they are looking for issues, sometimes they are looking at other issues. When we see these guidelines being issued, first things first, it is interesting timing, but the guidelines werent prepared overnight. They have been prepared over a period of time, and theres been a consistent trend in certain guidelines being issued around this time, in front of singles day, which as you mentioned is the biggest shopping day in china annually. So thats number one. The timing itself to us is not particularly surprising. Number two is the content of the guidelines is actually not that surprising. Yes, the china government is paying very close attention to Technology Companies, that is not surprising from the Chinese Governments history of action, and worldwide trends. To us, we will continue to digest this with the companies we work with and talk to come but its not a particularly Surprising Development in many ways. We expect the Technology Companies to continue on. Get to thest want to trends. One part of my question, we are seeing the likes of google and amazon getting more under the microscope, the regulatory microscope in the u. S. Amazon, the European Commission investigating them, too. This is a global trend, isnt it . What was over there is over here now, in some ways. When we talk about over here, how much did the ant financial suspension of the ipo hurt internet or internet investors . As you mentioned earlier today, internet stocks are recovering. One thing i would say is there has been regulator actions in china and overseas directed to specific companies in the past. Companies, you would see their talk stock prices take a shift in the shortterm, may be taking a hit in some ways, but we have seen a consistent trend of Technology Companies being able to continually adapt to whatever regulatory challenges and they face. This is a challenge that governments and Companies Face worldwide. Topanies contribute a lot economies worldwide, and governments recognize the value they bring. At the same time, government is paying increased attention to these companies, which is also good in our mind. Expect this balancing act to continue if government were treated in different ways, but thats why they are here, to help people. Rishaad thank you so much for joining us, thats hoi tak leung joining us. If you are a bloomberg subscriber, you can catch our interviews by using our interactive function tv. Join the conversation by sending instant messages to our team and guests during our live programming. Check it out, it is tv. This is bloomberg. Haslinda we are watching youre watching Bloomberg Markets asia. A look at the business flash headlines. Accusing other streaming services of failing to pay taxes. The minister for information and communications held a hearing that Foreign Services are often not complying with local content rules. The Ministry Says foreign streamers generated 35 million in revenue last year alone. National carrier will resume National Flights to 10 other denso nations destinations as airlines around the world look to get back in the air. Among the destinations on the schedule will be london, shenzhen, and sydney. Hong kong, seoul and tokyo. It comes after singapore and hong kong announced a two way travel bubble for international conventions. Indias second biggest carrier and is in talks tash boeing, and is renegotiating various contracts, as the coronavirus continues to batter air travel. The Indian Government has so far restricted financial help to airlines. Alibabas singles day shopping asee breaking records ecommerce comes under increasing scrutiny from regulators in china. Alibaba added new shopping windows and additional services. Orders, 580,000 in one second. Looking at markets. Weities just coming off of had. Hank sang negative. Shanghai weaker. Nikkei shut off for the lunch break around 24 minutes ago. Upside, certainly the story is one in reverse of what we have had in recent days. Investors assessing what going on with the coronavirus situation, particularly in europe. Perhaps also taking a look at some indications equity markets are becoming a little bit overheated. Shares coming back. Thats represented with the likes of tencent and alibaba at the moment, which has fallen back due to pressure of the government in china to do something about the huge amount of power they have, and a clampdown is certainly in prospect. Tailwinds from the s p 500 as it rose to the highest level we have seen since the second of september. The nasdaq jumped by more than 2 . The tech heavy weights surging alongside the stayathome shares, as they have been called, that have been lagging. Thats the Current Situation with the tech shares. 7. 7 to the upside. Haslinda covering so recovering some of the losses. A reminder that bloombergs new economy for forum happens next week. It brings leaders to find Common Ground and shaping a World Economy from east and west. We will bring discussions throughout the week on bloomberg television. Terminal subscribers can see it all on live go. More to come in the next hour of Bloomberg Markets Bloomberg Markets asia. This is bloomberg. Haslinda its almost 11 00 a. M. In singapore and hong kong. At our this is a look top stories. Lawmakers say they will resign en masse today. Beijing tightening its grip on those not deemed sufficiently patriotic. Tech bouncesnese beijings crackdown on monopolies. Rishaad india prepares a 20 billion package to lure international investors. Prime minister modi trying all to bring back the weakening economy. Haslinda asian markets up about highs. Hing toward record when you talk about tech, tech in asia getting a lift as well, especially those treated in hong kong. Continuesnues lyft its way down. Opecplus expected to keep cuts, which were to start at the beginning of next week. Rishaad Stock Exchange in thailand moving to the downside. Something which is a bit of an anomaly of late. We have had that market coming back after being th