In hong kong it is just past 8 00 a. M. The am julie hyman and political stories continue apace in the United States where the ands today was on mexico that cancellation of a meeting with donald trump and theresa may coming over as well on earning season in the u. S. A lot for investors. Yvonne absolutely. Picture on wall street, it is mixed. Relatively leading into asia, we are seeing positive asian stocks. Positive move in asia ahead of the holiday. We do have the nikkei 225 opening higher. Extending the gains that we saw on thursday when it was higher over 1 . Trading could be choppy given the stronger dollar and the mixed picture on wall street. Tensions between the u. S. And mexico over the border wall and markets in china, south korea, vietnam closed today along with partial trade in Hong Kong Hong kong, singapore. We have stocks in wellington snapping a two day rise. Australia adding. 5 after coming back from a thursday holiday. We do have miners dragging today on the index. The likes of northern start ,etting cuts by the likes of let me check my notes, mccoury. Fallingresolute also and Evolution Mining almost 8 cut to hold. Taking a look at the mixed the material space against other sectors in australia, we have the biggest drag over 1. 6 . In terms of points, we have a luminous seeing a decline. It was cut to sell by deutsche course beings of dragged down, given that prices of aluminum falling for a second day. Thats ok. We cant find it right now. What is going on with the yen, given the data we got this morning. Japan dropping for a 10th month. Target. R off of the 2 the dollaryen study this morning study this morning. Yvonne heading higher after the inflation data. The latest on the japan inflation figures we just broke earlier on the hour. Economicsg back our editor. Justesting conversation now. He said this has nothing to do with what japan is doing. This is about oil prices. Energy prices play a role. If you are the boj, every central bank is going to factor that in. Aboutoint that we raised trying to move the dial and expectations is important. It might be energy. We are seeing some improvement. The fundamental question, if you take out energy prices, what is the core doing . You see a little less negative. On the latest report, we saw the core, which was supposed to be down. 3, it was down. 2. Thecan see the headline, white line, it brings everything back in. It is positive. Take out food, energy. It is a little flat. It is far from perfect. It was interesting you asked about dropping the target. He smiled and said, maybe they should. I do not think they are prepared to do that. Making a little bit of progress with the bank of japan. He is also putting the weight on Prime Minister abe on doing something with fiscal stimulus. The yen, which nobody can control, there is still some sense it could be weakened more especially if you get this boost in the u. S. You could get the better exports, so it is, we are talking details here and on the other hand for the bank of japan, incremental progress will be pleasing. They might not drop the target as suggested. That tot really put relieve, we are so far below the target. What might the bank of japan do . I hope they do that something because im going to be in tokyo to cover the meeting. This is one of the meetings where they put out a policy report. Was had an assessment that fairly benign. Will they change that at all . Probably not. Will they continue, is the official message to echo what governor kuroda said, answering questions that he does see a better inflation picture. About the federal reserve, so interesting the way they have their meetings almost on the same day, the fed will be meeting and we will get those results on wednesday. No change expected for the fed third the big issue, donald trump uncertainty. Presentioned he has to everything he is going to do with congress. Maybe they will get on board. Until the fed knows what is going on with fiscal stimulus, they will be sitting still. Andant to see what they say what kind of guidance we get. That is what everybody is hoping for from the major central banks. What do you see now . Not only data dependent, also trump did. [laughter] thanks so much. Lets get to first word news. First up, the Trump Administration has floated a 20 tax on imports for mexico to pay for a wall along the border. The plan was revealed after Enrique Pena Nieto canceled a meeting of the white house. Sean spicer told reporters such a tax would pay for the wall. He did not explain how it might affect consumers and businesses. Finance ministers says his debt is declining and funding for this year is under control. Officials are urging reforms following an increase in costs, saying markets are nervous. The minister says while borrowing costs are you concerned, he expects volatility to fade away. We have a cash buffer that is the year. Gh to face we are in a comfortable position. The challenges are there. We are preparing ourselves for that. Board of toshiba meets to discuss a range of turnaround options. The sale of part of its chipmaking business will be on the agenda. Mayanticipated writedown also come up. Loss may be as much as 6 billion. Theira will announce estimate on february 14. Money rich chinese soccer clubs pushed the market to a record 4. 8 billion. Says the chinese spend 450 million on foreign players, up from a year earlier. That makes china the fifth biggest lender in the global market. They passed france and are within striking distance of clubs in spain and italy. Global news 24 hours a day powered by 2600 journalists and analysts in 120 countries. This is bloomberg. Alphabet shares fell after fourthquarter profits came in below estimates. The result was dented by heavy spending and a onetime tax payment. Lets break down the numbers with our analyst in san francisco. Business looked strong. The shares did fall and they also closed at a record high yesterday. How do you weigh the results . Results, look at the the core ad sales business is very strong. Growth was 36 , the highest in four years. Youtube and mobile search are driving this. That momentum might continue. The Cloud Business might induce some volatility Going Forward. It is a large market. So the growth option continues to be there. The volatility might surface. Onetime saw a hardware cost and tax contributing. We call these things one time, but it sounds like you think we could continue to see some of these costs continue. Some elevateds, tax rate in the u. S. And onetime charges with respect to equipment. The equipment cost, we do not know if that volatility is going to go away. They willel is increase investment in cloud and hardware. Hardware, mentioned they are really pushing for this when it comes to pixel and daydream. What impact could that have . Jitendra the margins would dip because of the hardware business. If you look at the segments, one and the Cloud Business, the end market for the Cloud Business is very big. We are talking about more than 70 billion in sales by 2020. They are going to look toward growth and invest in growth at some expense of the margins. Measures. Ost control there are some things that are being done that could balance these things out. These guys are going to invest. Thanks so much. Chinas crackdown sending shudders through Global Property markets. We will discuss how local markets are faring. What goes up must come down. Not necessarily when it comes to markets. Some think the dow will continue past 20,000. We will ask why. This is bloomberg. This is daybreak asia. I am julie hyman in new york. Asian stocks on course for their strongest since 2010. Volumes are low as many traders have left for the Lunar New Year. My next guest is standing by, executive director are at peak asset dan richmond. I want to start with the mac ts over whether we will see a rally. One of the charts i have been watching has been the put to call ratio on an etf that tracks the dow. Even as the dow has made new highs, we have seen bearish bets go up. Is that a good idea . Should people hedge as we see u. S. Stocks move up . Thanks for having us this morning. Dow jones ist the going to surpass 20,000 points and that may continue. We have seen wage growth continue to rise. Pmi is about 55. The numbers we are getting on the macroeconomic side does support for their growth. Shouldeel investors remain neutral leading into the reporting season. Theres also a lot to digest when it comes to the various Political Developments in the u. S. A lot of ways to play it. One of them is looking at russia. We have seen investors getting into russia, looking at an etf on the bloomberg, one of the charts we have been watching is looking at the russia etf and the inflows we have seen here have been substantial since the u. S. Election. We have seen oil rebounding. That does not hurt. Do you think russia is a good that right now . Saw he expects russia to surpass and outperform all other emerging markets. We have a good conversation with a Venture Capital fund out of singapore that is heavily invested in russian funds. We do agree theres probably additional upside risks to russia and we are bullish on theia, whether oil or emerging markets. We do see some upside in etfs. It back home for you in australia. You are in earnings reporting season. We have heard some of the miners already. Given what you expect to hear from the rest of the companies, how is earnings season going to look and would you be a buyer based on what you are hearing . Look, the season has not formally kicked off. We have had a few come out. The big shining light, we expect 17 growth for the season. A lot will be underpinned by the miners. Coal is up. Iron ore around 80. Commodities are strongly supported. What is happening, we expect the miners and the materials to outperform. We would be buying them leading into the reporting season. Banks have had a good run. And the netnings interest margins and the Credit Rating will be a focus. Seems like australia is contributing to this revival in asian stocks. Really roaring back this year. It seems like the underperformance we have seen compared to the s p, there seems to be a turnaround after a couple of years. Do you see this as a sustainable Inflection Point . Niv absolutely. If you look at china, the data was strong last week. Productiontrial is up and the chinese have discussed additional stimulus. We agreed that is probably going to be the case. We are bullish and the whole relationship with china and the u. S. Turns the trade numbers. We see some upside as well. The fact emergingmarket such as the peso and the ruble and the turkish lira are at those alltime lows, it does bode well for export growth. If you look at the export growth , the numbers coming out of emerging markets, we see some upside risk in our vision in the shortterm. That is right. When you hear the president about building a ball in mexico, it could impose a 20 tariff in the country, he wants border taxes for these multinational companies. For em are we overlooking that risk right now . You are bullish. Why . Niv look at the mexican etf. Rising by over 2 . We feel a lot of the geopolitical risks are factored in. The market is far focusing on additional stimulus. There is further upside revision in emerging markets relative to u. S. Equities and we are biased here. Real quickly, i know we are expecting this meeting between theresa may and donald trump on friday in the u. S. What do you expect out of that . May and think Theresa Donald trump will form a strong relationship. We saw the pound have a rally last night and we saw the export numbers much better than expected. The focus will be on health therm and we believe theresa may and donald trump will be a positive rather than negative for both economies. Great to have you. Executive director at peak asset management. Thank you. A quick check on the latest headlines now. A mine is threatened by environmental projections. Closed since 19 people were killed. Now a local mayor has refused to authorize the water from a nearby rivers. Amarco cant complete an official study. A lowertarbucks has annual sales forecast. It expects revenue to rise this fiscal year, having forecast doubledigit growth. A shift to Online Shopping and low grocery prices may be keeping customers away. Momentum is slowing as Howard Schultz prepares to leave. Caterpillar retreated after a forecast fell short of estimates. It blames ample supplies a of used construction equipment. Cala pillar says any benefit will not be seen until sometime in 2018. Coming up, microsofts Cloud Business is making it rain. More customers are signing up for data services. This is bloomberg. S daybreak asia. The streetosoft beat on strong sales and gains in cloudbased services. Su keenan has the latest from new york. Take us through the numbers. The stock was up in afterhours trading. Investors are very happy on the latest news. Secondquarter sales and profit beat the street. Rising customer signups a big part of the story. 84 Cents Per Share versus 79. They beat on secondquarter sales targets. The azura Cloud Service doubled and that is showing the investment in data centers are thing off. The ceo is revamping the company to be a seller of Corporate Services and again that also seems to be paying off. Not a bad year for the company. The stock is doing well. Lets talk about forward. They reported losses. The ceo was optimistic. Su he thinks he is heading into a good year. The losses have a lot to do with the mexican plants. They canceled their plans. They took a 200 do 200 million charge and there you have the loss. Otherwise the adjusted numbers were in line. The ceo is optimistic. He had a big meeting with the new president and is happy about reduced regulations and the year ahead. It was a very positive year for us and the cash liquidity is strong and we distributed 3. 5 billion to shareholders. A very good year following a record year we had in 2015. Optimistic about indications theres going to be some tax restructuring and also lightening of the environmental regulation. When asked about the mexican import tariff, did not think it would be a problem. Week. A big m a on start with Johnson Johnson and their buyout of actelion. Su they finally sealed the deal and they do it in dollars. A 30 billion deal. 80 a share in cash for stockholders. It finally finalizes what has been a longterm process. It has been a gain for johnson the french leaves company at the altar. Verizon is another big story. The ceo said to approach the ceo liberty regarding charter communications. This is according to people close to the matter. Charter has not been approached about a murder merger. They are studying a number of options. This one could possibly result in the largest Internet Provider in the u. S. A lot of speculation. Charter is up 10 on talks. Back to you. Crackdownve chinas on capital outflows is sending shudders through the Property Market. Ive spent my life planting a sizesix, nonslip shoe into that door. On this side, i want my customers to relax and enjoy themselves. But these days its phones before forks. They want wifi out here. But behind that door, i need a private connection for my business. Wifi pro from comcast business. Public wifi for your customers. Private wifi for your business. Strong and secure. Good for a door. And a network. Comcast business. Built for security. Built for business. Yvonne we are counting down to the Lunar New Year holiday. Trading today. I am in hong kong. Julie you are watching daybreak asia. Lets get the first word news with courtney collins. Courtney japans Consumer Prices fell although the pace of decline supported expectations for a return to inflation. Core cpi was down. 2 . Oil pricesn and likely to drive up inflation. Questions remain over flow wage growth and lackluster consumer spending. Chances are rising that bank of japans governor will stay on in ministerwith prime abe saying he is doing a terrific job. Kuroda is now 72. His radical Monetary Policy program has been the core of abenomics. Revisefailed to inflation or the economy. A wave of Senior State Department officials have quit as the Trump Administration exerts control. They are mostly Career Foreign Service officers and held positions that require president ial appointment. Sources say trump is keen to shake up the state department and make a break with what he sees as decades of failed foreign policy. Quite apocalypse now, beenhe tuesday clock has murder moved 30 seconds closer to midnight with scientist saying americans are at peril. The threat to the planet is seen at its worst since 1953 during the height of the cold war. Global news 24 hours a day powered by 2600 journalists and analysts in 120 countries. I am courtney collins. This is bloomberg. Thanks. The Doomsday Clock is interesting because even though it is developed by scientists, it is not a scientific measure. An opinion measure, how dire the world is with regard to things like Nuclear Weapons and climate change. That is why they moved to the clock closer to midnight. Yvonne doomsday, when you hear Nuclear Weapons, those are buzzwords when it comes to an incoming trumpet administration, which they did site. The markets are not seeing a doomsday situation. Lets take a look at how as and markets are shaping up. Asian markets are shaping up. We do have stocks on course for the best january since 2010. We do have a bunch of markets closed ahead of the holiday, including china, south korea, taiwan, and vietnam. With what is going on today, rising after coming back from thursday. Helping stocks, banks while miners are on the decline given the drop in gold and industrial metals. Stocks in wellington snapping a two day rise and the nikkei 225 up over 1 . We are seeing some fluctuation on the cpi data. Take a look at what is moving on the index. Yesterdays