Samsung. But also how it points to this bottoming out in the chip market and potentially the recovery for semiconductor demand. Were actually seeing sk hynix starting today on the back foot, sliding about 3 now is investors digest that scorecard. Potentially what we got from med is bringing from meta is bringing the downdraft into the korean session. The outperformer among the asian currencies looks to be reversing some of that today. We also have the open in japan. One of the things we will be watching out for has been the japanese currency which has breached the 155 level. This has got to do with that yield gap as we saw the way u. S. Treasuries were coming under pressure overnight. But now that we are watching the yen at the weakest level versus the greenback in about 30 years. Consider how back in june 1990 when it breached 155, it was a matter of a couple of days before it reached the 160 level. Though there is some skepticism as to whether we will actually see intervention by the finance ministry simply because of the timing. We do have the boj decision that is due tomorrow. And tokyo cpi numbers. So this does complicate the picture. Japan stocks also under pressure after the recovery yesterday. That was thanks in large part to teslas plan helping to reinvigorate the markets in asia. I want to take you to what we saw in u. S. Treasuries. As i say, it was under pressure during the session. The idea coming through from australias high inflation print that inflation is stickier than Central Banks might like. That really put pressure on global bonds. Further out into the curve you go, the less demand you see. They seem to be reluctant to put on duration. We did see an ok five year option after a successful two year run. This is what we are seeing across the curve. Really focusing on the earnings from south korea here. Paul thank you very much. Lets get more detail on the sk hynix earnings from our asia stocks reporter from seoul. In the early going we are seeing a bit of a selloff in sk hynix, weaker by about 3 despite very impressive First Quarter numbers and what appears to be a prettied decent outlook. Are we seeing some profit taking . Youkyung sk hynix reported a lot higher than expected but we are seeing a drop in the share price. That is probably because the Macro Economic factors such as the geopolitical risk and the fx rates, things like that, are getting a bigger attention from investors now. They have been buying shares this year based on the ai boom. Looks like earnings are really good. But investors are now seeing the macro factors as a bigger factor affecting Companies Like sk hynix than other chip stuff and south korea. So we will have to see how foreign and flash there is flow from now Foreign Investors flow from now on. And that answer may hinge on the Macro Economic and geopolitical risks, not just to earnings. In other news that may have shaken Investor Confidence in sk hynix is the Company Announced a plan for a new chip plan that is up to 15 billion in some investors might be worried about the new investment increasingly chip supply Going Forward. That could also pressure memory chip prices. Paul yes. That 14. 6 billion Expansion Plan for a new plant in south korea was announced. We also have sk hynix saying plans to modestly increase this year. So is there potentially even more spending in the coming quarters . Youkyung sk hynix gave announced some positive news when it was releasing its earnings, such as its business has made a meaningful turnaround during the First Quarter and it is seeing memory demand study. It sees prettied good dividend coming from conventional memory. So this investment announcement may be showing the confidence from the company that is prettied bullish on the demand coming from the Ai Investment from around the world. However, todays a selloff in the stock may be showing that investors are still prettied worried about the increasing supply of the chiefs the chips. I am pretty sure investors are waiting to hear about the sk hynix earnings Going Forward during the Conference Call underway. So we will have to see how the share price goes after the earnings Conference Call is over, when there will be more details about how the company views the sector and the ai demand and its own earnings for the next quarters. Paul asia stocks reporter youkyung lee there in seoul. Lets look at how some chipmakers are performing. Sk hynix off earlier session lows, still weaker by about 2. 2 . Samsung in its place, south koreas Largest Company also weaker by 1. 6 . Lets get over to our next guest , cheuk wan fan from hsbc. Thank you so much for joining us. I want to start with you or calls on some asia tech names. When you see a pullback like what we are seeing now in sk hynix are you tempted to buy that dip . A previous guest said this would be sk hynixs best ever year. Is this a good entry point . Fan we are remaining constructive on the Asian Technology sector. We think that the Ai Investment boom will continue to drive pretty Strong Demand for highend memory and Semiconductor Products and Asian Technology leaders are wellpositioned to ride on this global Ai Investment expansion. In this is going to bode well for the earnings outlook currently. We are overweight on the korean equity market. As consensus earnings continue to project around 64 gps growth. We think the latest announcement from companies to expand substantial, to expand the capacity on highend memory chips. This is reflecting the very strong underlying demand observed by corporate management. So we think the fundamental outlook for asian tech stocks remain positive and we will take this as a buying the dip opportunity. Paul outside of tech, what other sectors do you like for diversification in asia . Fan within the asian equity market we adopt a diversification strategy, given the diverging fundamental and growth profile. Currently we have overweight position in japan, south korea, india, and indonesia. Within the china and equity Hong Kong Market we hold a neutral and technical allocation position. We mainly focus on Service Consumption and highend manufacturing and the Telecom Sector in china. So we look for companies with resilient earnings. We also focus on the beneficiary of corporate government reforms across the region as we actually see quite positive momentum in corporate reforms in japan, china, and now south korea also a view. More details about Corporate Governance reform that encourages listed companies to enhance shareholder values through dividend payout increase and share buyback. And these actually deliver quite attractive Investment Opportunities with strong fundamentals. Paul youre also overweight u. S. Markets and you are not alone in that call. To what degree do you feel that the earnings story has taken over from fed easing as the major catalyst markets for now . Fan we actually see the main driver for Global Equity markets including the u. S. Equity market has been shifted to corporate earnings expectation rather than rates, given that in the first four months we see heightened rate volatility driven by uncertainty surrounding the timing of the fed rate cut. But we see continued strength in the u. S. Equity market mainly driven by improving macroeconomic outlook as a soft landing scenario continues to play out. In corporate guidance continues to point to pretty Solid Earnings recovery in 2024. And this is the key driver behind the u. S. Equity rally. The tech Company Continues to deliver very Solid Earnings growth. We think that recent weakness in the tech stock reflects a technical pullback rather than a trend reversal. So we continue to see opportunities in the technology sector, but importantly, we expect the u. S. Equity rally to broaden beyond just big tech. As we expect Economic Growth will continue to get momentum. This will continue to benefit Consumer Discretionary and financial stocks in the u. S. So we expect u. S. Outperformance will continue to sustain. Paul we cannot let you go without getting your view on the yen, which we see weakening to levels we have not seen since way back in 1990. We do of course have a bank of japan meeting starting today. Do you expect any sort of bold policy, maybe even a rate increase from the boj to defend the yen . Fan we expect the boj to stay on hold in this meeting. However, we do expect the boj will likely address the market concerns about the currency, volatility. However, we think the boj will remain pretty prudent in normalizing monetary policy. But given the strong u. S. Dollar, and this is mainly driven by the aggressive Market Pricing for slower and later fed rate cuts, so this actually creates room for the boj to raise Interest Rates earlier. Currently, we expect the boj will likely deliver another rate hike in the Third Quarter of this year. We anticipate a potential 15 bip rate hike in q3, given the continued strength in the u. S. Dollar and this drives the yen to hit more than 30 year lows. So, with this goal for the boj to further adjust Interest Rates, we also project two more Interest Rate hikes in japan going into 2025. We expect one hike in q1 next year and another hike in q3 next year. Taking into account our projected rate hike in q3, we anticipate that the upper target range for the japanese policy rate will go up to 0. 75 by the end of next year. This would reflect a policy normalization in japan, and this is support some stabilization of the yen going into second half of the year. Paul all right. Some aggressive moves coming from the boj. Fan cheuk wan, hsbc Global Private banking and wealth. Thank you so much for joining us. That is our bloomberg question of the day as well. Will the boj or the fed move rates more in 2024 . That is becoming a very live question indeed. Still to come, the clock is ticking for tiktok in terms of its fight against the u. S. Divest or banned bill. Eurasia group we joining us to tell us what this means for digital diplomacy. That conversation coming up later this hour. First were going to have more on the investor backlash to meadows earnings as it doubles down on its ai ambitions. This is bloomberg. Thanks to avalara, we can calculate sales tax automatically. Avalarahhhhhh what if tax rates change . Ahhhhhh filing sales tax returns . Ahhhhhh business license guidance . Ahhhhhh crossborder sales . Ahhhhhh item classification . Ahhhhhh does it connect with acc. . Ahhhhhh ahhhhhh ahhhhhh to me, harlem is home. But home is also your body. I asked myself, why doesnt pilates exist in harlem . So i started my own studio. Getting a brick and mortar in new york is not easy. Chase ink has supported us from studio one to studio three. When you start small, you need some big help. And chase ink was that for me. Earn up to 5 cash back on business essentials with the chase ink business cash card from chase for business. Make more of whats yours. Paul tiktok says it is ready to challenge a law that would ban the app in the u. S. Unless its chinese owner bytedance sells its stake in the company. President biden signed that legislation wednesday as part of a larger foreign aid package. Rest assured we are not going anywhere. We are confident and we will keep fighting for your rights in the courts. The facts and the constitution are on our side and we expect to prevail again. Paul lets bring in our tech reporter alex barinka for more now. We just heard from the tiktok ceo saying he is going to fight for americans constitutional rights, giving us a preview of what this legal battle will be about. Alex that is the message he has for users and employees internally that the fight is not yet over. Tiktok and bytedance both expected take this to the courts, with the hopes of either delaying the enforcement of this bill, or getting it killed altogether. The First Amendment argument is one that we very well could see, with them claiming the government is infringing on its users rights. We could also look to some past legal battles for other clues on the arguments they might have. The state of montana had a bill that aimed to ban tiktok in that state, and tiktok sued, as did a group of users whose lawsuit tiktok funded. So we could see folks on the docket who are not just tiktok or bytedance, but perhaps some of the users, content creators, or the merchants selling on tiktok shop. Paul so, where do we place the odds of this legal challenge being successful, and how long could it potentially go for . I mentioned that in the context of a president ial election coming up in november. Alex of course. Our Bloomberg Intelligence litigation analyst expects that if an appeal gets filed to the d. C. Second circuit, which is a very likely choice for this, the legal battle could be expedited and be wrapped up as soon as the end of the year in the fourth quarter. He puts the chances of bytedance and tiktok succeeding and overturning the law at just 30 . The confidence the tiktok the context with the election is important. The u. S. Will vote on the next president ial election in november. And this deadline for bytedance to sell or divest its stake in tiktok actually comes due the day before the president ial inauguration in january. So depending on who wins the president ial ticket next year, it could have a big impact on this. Obviously President Biden signed this bill into law on wednesday morning in the u. S. And if he ends up still being the president , hes leading the Democratic Party right now, he might very well see this out as a ban if bytedance is not able to offload its stake. But the republican frontrunner is donald trump, who in recent weeks has said he thinks tiktok should stay in america. If donald trump wins the november election, tiktok and bytedance might be in front of a friendly audience as they make their audience their argument to stay. Paul tech reporter alex barinka on the ban tiktok bill. We are going to delve into how that could impact ties between washington and beijing. Eurasia groups xiaomeng lu will be joining us later. Plenty more to come on daybreak asia. This is bloomberg. Paul lets take a look at how we are tracking commodities at the moment. Iron ore continuing to put in a spirited recovery, better by another three quarters of 1 . I cannot tell you how iron ore miners are doing in australia because we are closed for Public Holiday today. Thats pulling back from levels we saw earlier. It was getting close to 10,000. There has been some reluctance from some of coppers major consumers in terms of paying that much. We have blackrock however saying that copper needs to rise to 12,000 to incentivize largescale mine investments. The willingness to pay these eye watering prices seems to be absent. Lets talk a little more about the commodity space. We are hearing from bhp, the worlds biggest miner. It is said to have approached Anglo American to buy the company. It could be the biggest shakeup in the industry in more than a decade. For more we are joined by Martin Ritchie. What more do we know about this . Martin so far we have had confirmation from Anglo American, which is bhps target. As you said, this would be a really big mining deal and perhaps the biggest m a deals this year. Bhp is the worlds biggest miner. It produces everything from iron ore to copper and nickel. And anglo has a similar profile, a lot of different commodities. But what is the key here i think is copper. Anglo has a substantial production in copper and as anyone who watches the commodity space knows, there is a lot of interest in buying copper around the world because people think theres going to be a decade plus a very rapid demand growth. We dont have any confirmation from bhp yet. As you said, it is a holiday in australia, we will see what happens. But this is a deal that will shakeup the mining space and could dominate the agenda this year. Paul yeah, its been some time since we have seen such largescale dema dealmaking from bhp. To what extent is this becoming a bit of a trademark of ceo mike henrys leadership, and have we heard in response from anglo about this reported bid . Martin i think everyone understands that the ceo probably wants to make it extent i a big stamp in his leadership. Bhp already made a big deal in copper last year, a 6. 4 billion deal. So, that expanded their portfolio there. They have already said anglo has already said that bhps proposal will see anglo first spinoff its iron ore and platinum business in south africa, and that really emphasizes this focus on copper. Rio tinto, bhps rival in the number two iron ore miner, has also been looking to build up its copper business. And we saw glencore, the International Trader and miner, try to take over these Tech Resources as well, principally for copper and zinc. So you can see how this is shaping up into a big battle for control of the worlds copper resources. Paul all right. Commodities reporter Martin Ritchie there. Lets take a look at how we are doing in the fx space. Of course we are very closely watching the yen. Well, we are always watching the yo