We have world coverage here on daybreak asia. We will have the latest news from sydney. Betty and, follow from firing of theps fbi director, that stunning news earlier this week. We are live from our u. S. And asia headquarters. I am in new york, it is just after 7 00 p. M. Yvonne it is just after 7 00 a. M. In hong kong. A soggy day in asia, not just the weather. The markets, as well. Earnings at a retail with the biggest disappointment. Consumer staples were one of the better performers today on the s p. As you mentioned, that risk off coming into the market, we did fight back from the low of the session to close near the high of the session. Still on the red. S p down 2 10 of 1 . Losing. That makes it all the more poor and important to see direction in the market. An upside to the retail scale numbers tomorrow to see where the economy is headed. Numbers suggest a big rebound. Here is how asia is keeping things kicking things off in new zealand. Cautiousness, stocks down 1 10 of 1 . The kiwi losing ground, extending losses after the Bloomberg Technology after the rbnz had a dovish tone. Oil slating a bit. We did touch 40 a barrel during the overnight session. 7373 for the aussie dollar, seems pretty stable right now. Futures heading lower today. In japan, the dollar rebounding overnight. We are still around 113, close to 114. Stocks showing trepidation. As betty mentioned a head of retail sales out of the u. S. Later on this day. Lets get more from adam haigh, joining us live from sydney. We saw u. S. Stocks falling from record. Could this happen as a rising appetite for bonds and gold . Adam good morning. Lets be clear about the magnitude of the declines. It was only 2 10 of 1 . The key thing is, the u. S. Consumer. The biggest input into the economy is the consumer. Any worries about flagging appetite to spend dollars and american shops is key to the american economy. That will be the assessment traders are making this morning. Into friday night, there will be further data we get from the u. S. Malaysiaare looking at for a centralbank decision. Later today, a conference in dublin with the chicago fed speaking. Also, the irish contingent. Plenty more to pass. The key focus in europe is how the tapering will happen. For the u. S. , more about Balance Sheet reduction in policy normalization process over the next couple years. Weakness asbit of we start with the equity section. Nothing should concern us too much at this point. Betty talk about the scoop. Chinese authorities may be willing to step in and buy a hong kong stock before the july xi jinping visit . Yes, great story. To bring up a chart on the context ono give us how hong kong stocks have been performing relative to the poor performance in mainland chinese equities, this forms the backdrop. State isonder why the in the Hong Kong Market. We have enjoyed a good rally here. The arrival of xi jinping in hong kong does not occur until july. We have many weeks to go until then. Our reporters are speaking to sources yesterday. They found out that state funds have been set aside to step in and by equities in hong kong, should any material downside in the market play out. Would triggerwhat intervention, what the magnitude of the move would need to be, or what else from an economic point of view would require them to step in. Funds are being set aside. As we get closer to that meeting, we should keep an i on how the stock market is performing. We will hear more from our sources about how this is lining up as we get closer to july 1. Betty lets get the first word news with courtney collins. The bank of england is taking it for granted that the u. K. Will negotiate an orderly brexit. But investors are not so sure. The governor says he may have to raise rates sooner than expected, based on forecasts that assume a smooth adjustment to a new relationship with the European Union. Traders question the likelihood of such an outlook, that has sent the pound down. Thee have assumed that process of leaving the European Union would be a smooth one. What does that mean . It means there will be an agreement. And that there will be a transition, or implementation period from the negotiation to the new agreement. New korean president moon aware of thee is deployment of a u. S. Missile shield and will try to fix the problem. And a phone call to xi jinping he said it would not be able to would be possible to recover them thaad system if north korea was not a problem. A widening on the ban of laptops and other Electronic Devices on planes bound for american airports. Delta willrican, and meet with the department of security to discuss the decision. Originating from eight countries in the middle east. The company belonging to the family of President Trumps soninlaw says nobody tied to him will be at a presentation to chinese investors this weekend. Kushner companies withdrew from whenvent inch and jen there was a similar pitch last weekend. She told potential investors that buying and could help them win residency visas. Global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. I am courtney collins, this is bloomberg. Betty President Trump says he fbi directorred james comey despite advice of top officials. That is contradicting the official white house statement on the matter. As if we needed more confusion. Ramy inocencio has been following this. Mixed messages here. Confusion is the word. Confusion over the loss of confidence in james comey. As early as last week, sean spicer told the press that mr. Trump did have a full confidence in his fbi director. Now we know those words are not true. Earlier in the week he said he would fire him and that he asked the deputy Rod Rosenstein to write a letter on behalf of him to provide cover. Now he says he would have done it all on his own, so wherever he stands, we are not sure. But this is how it played out. Lets take a listen. President trump he made a recommendation. Regardless of recommendation, i would have fired comey, knowing there was no good time to do it. Ramy donald is also saying the fbi has also lacked the support of comey, that he did not have the fbis support. But that contradicts a statement for the acting fbi chief, Andrew Mccabe, who says he is contradicting what trump says. Take a listen. The greatestn privilege and honor of my professional life to work with him. I can tell you also, the director comey enjoyed broad support within the fbi, and still does, to this day. Acting fbi chief Andrew Mccabe there, by the way. People are asking, why now . Some are pointing to the fact he was leading the probe into the collusion between the white house and russia. Potential he folks are saying he was getting too close to something . We are not sure, but some people say that maybe is a possibility. Democrats are asking for a special counsel to get to the bottom of this, regardless of what has been happening. The white house says it will speed up the russian probe. Yvonne we did not get much clarity when it comes to the timing of events leading up to this. The Senate Confirmed of the president s nominee, robert lighthizer. What will be his first order of business . Ramy that was confirmed in the last few hours, robert 4,ghthizer by a vote of 821 confirmed in the u. S. Senate. The first thing on his agenda is likely to be the renegotiation of the nafta. That said, it is not going to be immediate. There is an official, 90 days in terms of consultations with congress in order to pull the United States out of its agreement with mexico as well as canada. Donald trump has threatened to withdraw from that agreement, if he thinks the discussions are not going his way. With lighthizer, there is been politicking back and forth. He was nominated in january. But there have been questions about his dealings a few decades ago, his working with foreign governments on their behalf to the United States. He did get a legal waiver. That will be going as planned, the confirmation in the u. S. Senate. I want to go back to donald trump one more time. Hop into my bloomberg terminal. With all that has been happening, i have to highlight the real clear politics poll of polls, in terms of approval and disapproval numbers of donald trump. The lines are going in ways he does not want them to be going. The blue line, disapproval at 53. 1 . It is at its highest since the early part of april. The white line is the approval, 41. 9 . April,est since middle definitely since april 13 or so. Wrong way, for president a little more than 100 days in office. Yvonne thank you, Ramy Inocencio joining us from new frenkela we ask jacob what he expects from the fed and other Central Banks. Economy, a wall street session, may spill over into asia. We ask advisers why it they remain optimistic. This is bloomberg. This is daybreak, i am yvonne man in hong kong. Betty i am betty liu in new york. Consumer prices. Retail. There is no sign of a slow down. We have a chief economist at First Trust Advisers from chicago. In your view, are the risks to the upside . Yes, i think it is. A have a full plate tomorrow. No different than the consensus, about 6 10 of 1 . Auto sales, everyone talked about how disappointing they were. That is compared to just a year ago. Compared to last month, they were up 2 . That plus higher gasoline prices could give us a surprise. Index, we arerice at 0. 2. If you look at todays producer theumber, the risks risk of inflation is rising higher than people think. You put those two things together, the economy overall, real growth us inflation, plus inflation, we are rebounding strongly from the first weak quarter. Betty why are markets looking so tired . Why are they not responding to that robust assessment . It is a great question. I have been 35 years in this business. I have never figured out why markets moved this way or that way over a month or days. Not to say it is not important, but i still believe that in noeath the economy, way close to a recession, earnings have recovered really nicely. We are up over 15 in the First Quarter for u. S. Earnings. The stock market, in my opinion, is still undervalued. Not as much as it was. It is not super cheap, but it is still undervalued. Earnings will grow faster than 10 this year. It is a recipe for higher stock prices. What the market is doing is giving people a chance to get in right now. Yvonne getting back to the inflation numbers, you mentioned a much stronger rebound. By some indicators, more than doubling. How long before it feeds into the economy . It will take some time, right . It does. Inflation is not a mystery, it comes from too much money. The Federal Reserve has done quantitative easing. There is 2 trillion of excess reserves sitting in the banking system. I have not been worried about inflation until now. Now that the Federal Reserve starts to raise Interest Rates, it makes it more attractive for banks to lend. That increases the money supplied and increases inflation. Of theway, that is one reasons people should not worry about the dollar appreciating too much. Yes, the economy will accelerate. But inflation is picking up, and that is a negative for the currency. I do not think Dollar Strength will take away u. S. Corporate earnings. That is not one of the things i am worried about. Yvonne you mentioned the fed, the market is underestimating the fed could hike three or even four times. You look at financial conditions, i want to show up a bloomberg chart. You see that the last two hikes we did see barely had any impact of financial conditions. In fact, conditions have loosened. Can the fed just rip the bandaid and get away with it . I still think the fed is super easy. Even if they were to do four rate hikes this year, i know it is a surprise to the market if that were to happen, but even if they were, Interest Rates would only be 2 . That is still lower than inflation. That is why these past couple rate hikes have not hurt the market. All the fed is doing is going from super easy, super loose, to less super loose. They are still very easy. Are low, theytes are not a danger to the economy or stock market. Betty i want to show our viewers how low them vix is going and has gone. Has closedes the vix in the single digits. Au might think it is positive. But is it a warning sign, as well . Are we too relaxed here . Goes up,he vix everyone says volatility is up, run for the hills. But when they say it is low, they say it has to go up, run for the hills. To scaree them vix people every day. I do not Pay Attention to it. It has been high and low in the last 8, 9 years. Force to go up is a earnings. Lots ofations global corporations, are very profitable today. They figured out how to do business, and they are doing it every day. Betty a nowin situation sometimes when it comes to the vix. Up, we may see koreas biggest debut in seven years and ipo market. Netmarble starts trading today. This is bloomberg. South korean mobile Games Company netmarble expected to raise as much as 2. 3 billion after pricing an ipo at the top of the range. It would make it koreas biggest share sale in seven years. Lets look at netmarble. Ofill get to the back story the founder later because it is a remarkable one, from rags to riches. Why is this so important for south korea . First, it is the biggest ipo in seven years in korea. It makes the company more valuable in terms of Market Capital capitalization than Lg Electronics, which is a Hardware Company. The fact it is becoming more valuable than a Hardware Company like lg means a lot for south korea. The economy has been centered around these huge conglomerates, producing hardware. This typeve to see if of shift will continue in south korea. Betty what is expected in terms of the stock price . Where is it likely to trade . There are mixed views about whether it is going to go up or go down when the stock market opens in 30 minutes. The market right now in korea is quite bullish. On the backuld ride of that bullish sentiment. At the same time, its price to earnings ratio is quite high compared to competitors. Right now it stands over 70. Other companies are below 50. There is pessimism over whether it will do well. There is also optimism because it has been showing Phenomenal Growth over the last several years. Yvonne tell us more about the company and its founder. It is a different story than what we see in south korea when it comes to the conglomerates. Really timely, given the election and the president requesting chaebol reform. Sam it is true, he has an interesting story about his life. He was born in at Textile Factory slum, dropped out of high school. He started businesses unsuccessfully before founding netmarble. It is quite interesting because most billionaires in south korea are from a family run conglomerate called a table a cable a chaebol. Last year, three people died in suicides in his company. Netmarble stresses those that did do with personal reasons. But the culture at netmarble is just too hard it may not be sustainable for the company to become a global company. Betty sam, thank you so much. We will watch a netmarble as south korean trade opens. Andral banks strategy ambitions. We will get more from jpmorgan Jacob Frenkel. This is bloomberg. 7 30 a. M. Friday in hong kong. A gloomy picture out there as asias first market opens. Betty soggy all the way around, a good way to describe markets, too. York. M. Thursday in new a risk off feeling in the markets. Some preparation ahead of tomorrows retail sales. I am betty lou in new york. Yvonne i am yvonne man in hong kong. President trump has described a former fbi director james andy as a grandstander, would have fired him, no matter what the recommendation. It has been in turmoil for months, and that comey was not the right person to help them recover. President trump had lauded comey for his handling of president Hillary Clintons emails. Ofositive atmosphere ahead the handover from britain. President xi is expected to visit to mark the occasion. Statebacked institutions have set aside funds ahead of july 1. China is not known to have taken an active role in the Hong Kong Market before. Robert lighthizer has been confirmed as u. S. Trade representative, clearing the way for the Trump Administration to reset relations, starting with nafta. His confirmation was delayed about questions about work you did decades ago on behalf of foreign governments, for which he needed a legal waiver. Said china is one of americas leading trade problems. Nissan has forecasted a surprise drop in profits on the expectation of a stronger yen and higher raw material costs. To 6ion profit will fall billion for the year in march as competition increases. It boosted annual sales by 33 since 2011. Theyve improved their brand value. Global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. I am courtney collins, this is bloomberg. Yvonne lets have a quick check on the markets. Trigger, ang for a catalyst to reverse the downfall we saw in the u. S. Overnight. New zealand down 1 10 of 1 . The kiwi continuing to go down,. 6842. A dovish stance from the rbnz. Hang seng, 21,000. Aussie futures heading lower today. Not Much Movement in the aussie. Futures in japan out of chicago, we did see a subdued reaction. 113. 77 for the dollaryen. Betty investors increasingly see the fed hiking rates again. They could pick up. The u. S. Unemployment rate continues to drop. Us nown hays a joining from tokyo where she has been all month long. Is the fed ready for another hike . Kathleen it certainly looks that way. We want to put this in a larger context. We have a very special guest, someone who has been following the banks for several years. He is the chairman of chairman international,se from israel. He meets with these policymakers, and is known them for m