Protesters tell leaders, welcome to hell. We have world coverage. Some harsh words coming out of germany. In seoul, Second Quarter profits should be coming up. Betty we are watching the g20 meeting in hamburg. We have will have insights for washington and across asia, what to expect from those talks and that meeting between putin and trump. This is daybreak asia, live from bloombergs usn asian headquarters. I am betty liu in new york, just after 7 00 p. M. After 7 00is just a. M. Here in hong kong. I am yvonne man. For markets, the stress has been in fixed income. Hawkish talk has brought stocks lower. Check out this bloomberg. You can see the tally what we saw overnight. Classes sold off, in tandem, for the first time in 10 days. This is the s p 500 etf and the treasury bond etf. Last time we saw these moves was 2013. Which has some wondering, is this the start of a taper tantrum . Betty which is exactly what the fed wants to avoid. Have been so careful to say the right things to the market to prevent this. I want to bring up a chart, as well. It shows you the results of that tantrum. We now have the s p below its 50 Day Moving Average, which is technically very important. It could result in further declines in the market that authority been quite volatile the past several weeks. Tomorrows jobs report seems even more important here in the u. S. Yvonne especially that weaker adp report. How that will be reflected in numbers tomorrow. A happy day and friday not a happy friday in asia, either. Lets see how things are playing out in new zealand. Were down about one third of 1 on the nzx 50. The kiwi,. 7275. We do see these underperforming the complex. The aussie, also lower overnight, weighed by the 2 drop in iron ore. We see a drop in the wti prices. 45. 35 a barrel right now. Japan, futures in the red. Lookingown 20 points, to see and 80 drop at the open after we saw that fallout of 0. 4 on the nikkei 225. Dollaryen, 113. 12. Looks like this can be continuing negative sentiment, this drought in bonds and stocks. Week out offtened france. Betty that triggered it. Markets were looking for some reason to start a selloff. That triggered over here, or dther soon amin tsunami over here. As we mentioned, longterm treasuries selling off. Breaking out in germany and france. Ramy inocencio has more on the fallout. You talk about the 50 Day Moving Average, key for the s p. But this is the breach we saw on the dow industrials. Excuse me, the nasdaq. The dow, we are 200 points away from reaching that. Not close, but you can see the downward trend headed toward that direction. We can imagine what happens if we reach that. Breach was thee first in seven weeks. We have to talk about treasuries in the u. S. Those of been on the move, up by four basis points to 2. 73 . That had been higher when it spiked up to seven basis points. That is just shy of 2. 42 . It has crossed its 50 day, 100 day, 200 Day Moving Average. They are saying we have only just begun, and the potential to see something even toward a 3 by the end of this year. He is calling that a definitive bear market, if we get to that number. Also, taking a look at the 30 day treasury, hop into the bloomberg terminal. We do not look at the 30 year too much. Andtalking about dmas breaching that, we have already breached the blue line. Were just we are just about to breach the blue line, the 200 Day Moving Average. And the green line, the 100 day dma. Open interest in september, long bond futures are falling on the order of 3. 7 million dollars. That indicates the bulls are starting to liquidate. The takeaway, we could see these treasury yields go further. Maybe even to 3 . Yvonne some liquidation in the tech spaces. Tech stocks among the big laggards again. Ramy we saw the fall on the nasdaq. And that Technology Shares down, also. Take a look at what is happening, your today. It looks like a rosier picture. Looking up to june 9, the nasdaq had already increased i about 18 . If you are an investor, youre probably about very happy. They are taking some of their chips off the table. You really cant blame them. Who wouldnt like 18 . Some are saying, maybe it is too good to be true. Apple, microsoft, facebook, intel, were the biggest weights on the nasdaq. Microsoft cutting thousands of jobs overseas. Intel settling a lawsuit about using the Mcafee Security name. We are also gearing toward another lawsuit. Apple in focus, but also to suem, saying it wants apple for Patent Infringement on its iphone. On iphone limited and imports into the u. S. Can you imagine if that was stopped in the u. S. . They are trying to do that. Even see the reaction with apple shares, not doing too bad in after hours, but itd been down 0. 2 . Years, we haveng been talking about tesla over the past three days because it came in at 22,000 shipments in terms of Second Quarter. That was less than 25,000 for the Second Quarter. This is a market cap. Ever since may come of the white line, is tesla, the yellow line is gm. Back in late may it crossed the market cap of General Motors and was the king in terms of the automakers. In the past day, this has lost its crown. 8. 7 billion lost to gm. Yvonne first word news with Courtney Collins in new york. U. S. Prosecutors are attempting to seize millions of dollars into north korea from eight to global banks, saying jpmorgan, bank of america, and city. Citi. But there is no evidence of misconduct with pyongyang. Japan and the e. U. Have endorsed a pulmonary free trade pact in what is a rejection of President Trumps protectionists leanings. E. U. President and john called Jeanclaude Juncker and a shinzo abe signed an accord to eliminate most tariffs between the partners. It follows more than four years of talks. The e. U. s top brexit negotiator is warning even a partial withdrawal from the block will have consequences for the u. K. s ability to interact. The frictionless trade relationship is not feasible, and a blow to members of theresa mays conservative party. They say it is not possible. Qualcomm is suing apple for Patent Infringement, the latest shot in an increasingly bitter legal battle over Technology Used in the iphone. The chipmaker claiming apple infringes on six patents and wants a u. S. A. M. On iphones. Apple has previously cut off license payments to qualcomm and filed its own lawsuit to accuse the chipmaker of trying to monopolize industry. Global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. I am Courtney Collins. This is bloomberg. Yvonne coming up, protests at the g20 as leaders meet in hamburg. This is bloomberg. Yvonne this is daybreak asia, i am yvonne man in hong kong. Betty i am betty liu in new york. Leaders at the g20 in hamburg. Changing alliances, talks on protectionism. There is violence on the streets. Matt miller has the latest. Matt standing here in hamburg meeting. 0 there are protests on the streets, thousands and thousands being pushed back by police with Water Cannons. However, all eyes are on the meeting between the biggest leaders, including u. S. President donald trump and russian president Vladimir Putin. We will be looking to see what comes out of that meeting. Other important bilaterals will happen, including President Trump meeting with chinese president xi and trying to diffuse the situation in north korea. President erdogan is here and wants to speak at his own demonstrations on the sidelines of the g20 summit. However, germany has forbidden him from doing that. He says if germany holds them back from that, they will be committing suicide. The europeanime, parliament has agreed to freeze the application of turkey to the e. U. There are a lot of geopolitical tensions simmering here as this group tries to Work Together to changeings like climate and to promote trade and deal with immigration. So many issues to deal with as angelalds the g20 merkel plans to push forward the german agenda and the european agenda. Matt miller, bloomberg, hamburg. Yvonne to talk more about this is max bergman, senior fellow. A former state Department Senior adviser. Great to have you here on the program. We talk about the protests and what happened at g7. Willo you think g20 welcome a President Trump . Will it be 19 versus the one . Beenthe welcome has not warm, with the mass protests in hamburg. I think a lot of the leaders are going to try to make nice with President Trump. Everyone is waiting for his meeting with Vladimir Putin, and to see what comes out of that. That has everyone on the edge of their seat. What, ifno one knows anything will come out of that. Willexpected that not much happen, it will be their first initial meeting, they will talk about various issues, the president says he is going in with no agenda. But we do not really know if there is something more, if there will be a deal that comes out of that. Betty i am not trying to make light of this, but these are two big egos meeting tomorrow. Who will own who, do you think . Max putin is going to own a President Trump. Putin is a seasoned, veteran president , who has been around the block a long time, a former kgb official. He prepares for these meetings extensively, and he will have an agenda. The fact that President Trump is going without an agenda means they will talk about the issues president putin wants to talk about. That will be about lifting sanctions, may some agreement or deal about syria. The question is whether trump bites on those offers. I think it could have a seismic impact on the u. S. European relationship. Betty i believe the tillerson will also be at this meeting, they will have two translators. It is a big deal for the white house. Here in the u. S. It will be as closely watched as the comey hearings. It is made for television. If you think putin will own a, how can trump deflect that . Kenny fight back . Max the russians do not offer the United States very much right now. There is nothing to make a deal about. Situation with a normal american administration, this would be a very confrontational conversation, similar to the one president obama had with putin over the putinew years, where would be confronted about interference, not just in the u. S. Election, but the french and dutch election. And some of their actions in syria and the ukraine. The fact that is not going to come up is rather troubling. One thing about the roster of who is attending, is it is really surprising the National Security advisor, h. R. Mcmaster, who will be there, is not going to be in the meeting. Instead, the person with the most government experience on the u. S. Side, not the president , but the translator, is really troubling. Yvonne a lot of this could be overshadowed by what is going on in pyongyang an issue of north korea. There is a consensus or opinion, view of the world, the world should accept north korea has Nuclear Weapons than to stop them from proliferating. Do think that is a feasible approach at the moment . Max in some ways, the recent test of an icbm changes everything. On the other hand, a changes nothing. It is a matter of how far the Trump Administration is willing to go. The u. S. Has not implemented sanctions with iran. It introduced secondary sanctions, which could have an impact on secondary chinese companies. Congress may step up and do what it did on iran. Whethera big question, trump and xi, in their bilateral meeting, can come to some understanding. We are trying to manage the andchina relationship, putting extensive pressure on north korea. Betty i want to read two statements from james mattis and donald trump. Mattis saying he does not believe it brings us closer to war. Then, trump said, it is a shame they are behaving this way, a very dangerous matter. Something will have to be done about it. He said that in warsaw. Who do we believe . Max i would tend to believe james mattis. But the president is commander in chief. If he gives in order, mattis is a dutybound to honor it or resign. It is a total incoherence within the administration over how to conduct foreign policy. One message comes from one secretary or cabinet official, and then the president says Something Else. What is clear is that the u. S. Has very few options on the military front. There is a limited amount we can do. Escalating militarily would be catastrophic, not just for south korea, but potentially for the entire region. This is about containing north korea and potentially engaging in talks down the road. Betty thank you so much for joining us, max bergmann, at the center for american, progress. We will have more on the g20 throughout the day. Peter mandelson joins us at 9 40, hong kong time. This is bloomberg. We speak to a former diplomat and now dean from the school of Public Policy in singapore. This is bloomberg. Betty this is daybreak asia, i am betty liu in new york. Yvonne i am yvonne man in hong kong. 5. 7 million for a majority stake and 34 billion in real estate loans inherited when it they bid for 51 of the assets by the end of the month. Santander will manage the holdings with of the winner. Betty trying to reassure investors after a sudden rout in shares related to the company. Shareholder says he is fine, they tried to blame the selloff on rumors about his whereabouts. Pared losses after operations were normal. Appeared briefly in 2015 to assist with a corruption inquiry. Yvonne sound cloud cutting some of its staff to help compete with spotify and apple. They were at risk of running out of money. Offices in San Francisco and london will be shut with operations consolidated in berlin and new york. Soundcloud has many regular listeners. Asking to ban of imports of iphones. An increasingly bitter fight over patents and technology. Matt larson joins us now from San Francisco. What has prompted these latest lawsuits . Matt what looks like is going on, apple and qualcomm has been in licensing discussions. There is an escalating legal title that is brought in manufacturers, the ones that build the devices before apple sells them. These talks have gone nowhere. Qualcomm is making an effort to get more leverage in those discussions. They did that by filing a lawsuit in the International Trade commission, which could threaten to block certain imports and sales of iphone devices in about 21 months. It is basically an aggressive litigation tactic to try to bring in some leverage and licensing talks. Yvonne we have seen this further escalate. Is a surprise to see these lawsuits filed . Matt it is not a surprise, it is a common litigation tactic in these largescale disputes. We have seen similar tactics used by ericsson against apple a couple years ago. We saw nokia file similar lawsuits when it was battling apple. Both litigations resolved before in ultimate block of any products. It is a common event in Patent Litigation among tech the giants. The balance being, apple is not going to come to the table and agree to pay a higher loyalty because that affects margins. Qualcomm does not want to give away any dollars or leave dollars on the table because it contributes greatly to their bottom line. It is highmargin revenue and qualcomm was to get as much as it can. So they escalate the legal battle and try to up the stakes before a deal is reached. Betty what happens next . Matt next in this lawsuit, qualcomm iron two suits. The District Court action will be put on hold. The International Trade commission will solicit Public Comments about what would happen if apples products were blocked from the u. S. Other Companies May weigh in on how it would affect Licensing Companies and entities that rely on collecting royalties. C will decide to begin an investigation in august. Rial will not happen in a another year or so, with an ultimate decision in 18 months. Yvonne the saga continues. Thank you for your perspective. Asia braces for a possible bond selloff after centralbank warnings send the u. S. And european investors rushing for the exit. Across the u. S. Betty samsung preliminary guidance for the Second Quarter looks like a record operating profit. Well above won, analystss estimate of 13 trillion. Sales coming in well above what analysts expected at 60 trillion won. These include the samsung 8 sales. Demand. Riven tobacco debacl e with the phones catching fire. There is been a lot of talk when it comes to the super cycle in shifts for samsung, whether it can knock off intel as being one of the most top global manufacturers of chips. For the first time when it comes to revenue, it looks like these numbers are supporting that case. A sizable beat when it comes to operating profit. You can see how this is benefiting the diversification of samsungs assets. Take a look at the bloomberg terminal, you can see however thing breaks down. This recent set of numbers are just the luminary. We are not going to get too much of the units and how they fare. You can see how the growing reliance on chips is slowly growing pace in the orange bars. The green bars or where the smart phone sales go. We have a revival of the smartphone business. S8 launches happening during this set of numbers. It is the first time were getting a glimpse of that. Things have been pretty positive, going through what we in sales. Will this be a turnaround after the note 7 debacle . Iphoneand you have the 8. They keep ratcheting it up. The numbers for samsung. Yvonne we will see the Marke