We will wrap up the weekend action from g20. Returns,sident trump how his Health Care Reit forms are faring in Congress Health care reforms are faring in congress not well. We are coming to you live from hong kong. We are the first ones to debut it, pretty spoiled here at daybreak asia. Is looking great. Cant wait to see how you will enjoy it. A new toy for you. It is just after 7 00 p. M. On fridayumbers looked good, a goldilocks scenario, but it does not stop investors from fretting about the bond market, treasuries, when rates will hike and we will get more clues this week from janet yellen in front of congress. Whether she will put more fuel into this on route. The equities markets bouncing. We will see if asia reacts the same way. We are starting off the week on one month lows. We will see if there is a bit of caution. You see how things are kicking off. Happening, new zealand flat, as well as the kiwi. , china inflation lowers out later on, wti for the week, so well below 45 after u. S. Drilling offset larger than expected drop in stockpiles. Are slightly higher after that drawdown of 1 on friday on the asx 200. Given the frosty relations in not a lot going on there. Dollaryen back to that twomonth high, breaking above 114 as the boj stepped in and went unlimited with fixed income operations to stop the rise in jgb yields, the 10 year yield now lower, also expecting machine orders and current account numbers this hour, but futures slightly positive this morning. The big question is how governor kuroda will keep going with this yield curve control given the forces out of the central bank hocks. Hawks. That tiltstill see from the fed given the jobs report. Up on friday with stocks, all three majors were up , in fact, technology was the , followed byr for Consumer Discretionary and industrials, the dow adding 100 points, and the nasdaq up over 1 . We will continue to watch that, but lets get to first word news. Wound up in hamburger with the u. S. Further out of step than ever. Receiptt trump platitudes, but little more on north korea. The g20 final statement called the 2015 harris a court reversible Paris Climate Accord not reversible. President trump says it is time to work with russia and discussed a joint cybersecurity unit. Even the president s own secretary state said relations with moscow would not change until russia lived up to its commitments. President putin thinks trump accepted his denial of meddling in last years election. Secretary of state tillerson this is ukraine to reassert support two days after the meeting between trump and putin. Tillerson called on russia to exercise its influence over separatists fighting in the eased. Trump tweeted on sunday that he did not discuss ukrainerelated sanctions during the meeting. In a diplomatic embarrassment, President Trumps press secretary appears to have mislabeled president xi jinping as the leader of taiwan. He referred to him as the president of the republic of china. President of the peoples republic of china. Global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Thank you. On wall street will take on significance given the bond rout in the last few weeks. Is this a route or a repricing of risk . Su keenan has a look at the week ahead. We are seeing an interesting pattern. The stronger than number on friday had a lot to do with the question for the monday trading session. 1445, stocks and tandem, then in white and blue boxes lower, who is bonds. Stocks up, bonds lower on friday, but the last time you saw both selloff was 2013. Comeiday, more widespread asia to europe joining the u. S. In being more hawkish. Lets listen to bill gross, the widely followed bond king, who says it is not a route. This rather strong jobs report from the standpoint of jobs, not necessarily from wages, which is what yellen considers, the fed has one hike left in the year, and thats probably december. The end of the year is the expectation. Btv1771, lets take 1771, lets look at how the jobs numbers hit the tape. Line, thehe top blue number of people not in the for us coming back into employment, and that is a significant data point that has people focused on headline job creation and that it speak strongly to the economy and shows the fed is on track for tightening as bill gross mentioned. There is also janet yellen semiannual report to congress, first the house, then the senate, but what can we expect in terms of guidance from the chair . As always, she is vague lets take a look at the video. Followed bylosely economists, particularly those in the bond market. It is expected to maintain a hawkish tone. She generally gives the latest monetary report. We will have a couple of economic pieces of data out, particularly retail sales come expected to come in stronger in june, and cpi, that likely rose according to economists. The earnings reports continue, big banks, j. P. Morgan chase, wells fargo, citigroup, all in the spotlight as we kick off trading in a couple of hours on wall street. Thank you. The g 20 wrapped up with both nations pulling together to fight protectionism, but President Trump cut a lonely figure at the meeting in hamburg when it came to Climate Change. The g 20 meeting in hamburg was a weekend full of confrontation that yielded little in terms of results. Demonstrators gathered to confront 20,000 police officers, but in the end, looted local stores, set cars ablaze, and through molotov cocktails. Meanwhile, President Trump confronted president putin on the alleged hacking of the 2016 election. Angela merkel and Emmanuel Macron confronted putin on the situation in ukraine. Only one bilateral meeting yielded tangible results between putin and trump, who agreed on a ceasefire in syria, but how long will that last . President trump received a lot of criticism for letting his sit in hisanka chair of the g20 meeting. The biggest conversation was around to trade where they agreed to fight protectionism but allowed members to use tray Defense Mechanisms where they see fit, which is basically the same thing. The g20 will demand more transparency when it comes to steal subsidies and try to fight dumping. Also when it comes to Climate Change, there was always going to be an issue because the u. S. Has recently pulled out of the Paris Climate Accord. The other g20 member said there is no turning act. Turning back. Those were some of the issues tackled during the g20. U. S. Japansouth korea promising to apply maximum pressure to counter north Koreas Nuclear threat. Saw, the g20 failed to produce a unanimous statement condemning the action. North korea did not even make it into the communique at the end. I want to bring in mark fitzpatrick, who knows a lot about relations with north korea and does a lot of studying on Nuclear Policy programs around the world. He joins us now from washington. Mark, i want to read you a tweet from donald as he left hamburg, i am leaving hamburg for washington and the white house, just left chinas president xi, where we had an xm meeting on trade and north korea. He says he had an excellent meeting on trade and north korea. We know how the white house has been on this. How can it be an excellent meeting if it did not really even come up during the g20 . That is a good question. President trump seems to use the thatexcellent for anything was not an absolute disaster. I expect president xi said words that sounded good, but what actions did he promise . Did he promise to put real pressure on north korea . No, that is highly doubtful. Then you have other members nikki party, including haley, who said a little bit later on another network that the white house will now look at trade relations with china to put more pressure on them. They keep saying these sorts of things, but it some point, want they need to follow this up with real action in order to make it look like it is not empty threats . They are trying to persuade china to put pressure on north korea, and would pressure on china have that effect . Probably not. Chinag a trade squeeze on is a doubleedged sword, and china knows that, so i dont think china feels particularly threatened by any such statements. For china to put real pressure on north korea would require the United States to actually give something to china, not the absence of pressure, but something that china would like, and one of those things that china wants is for the United States to engage in talks with ,orth korea, so the question is did the discussion with xi jinping get into that area at all . Did get out ofe the g20, was trump changing his tone when it came to relations with china, which contrasted with what he had been tweeting, the talks were excellent, and honor to know xi jinping, so was progress made when a comes to relations between the u. S. And china . The relations arent that bad. They hit it off pretty well at maralago in april. Has tweetedtrump some expressions of discontent and frustration, but as some reporters have heard members of the administration say, dont Pay Attention to Donald Trumps tweets. Pay attention to statements that are well crafted by secretary of state rex tillerson. The United States has taken was not happyina with, the announcement of an arm sales package to taiwan, the freedom of navigation exercise in the south pacific, said the United States is trying to do something to show that they are not pushovers with china. Hang on. We will have with you more in a few moments. Mark fitzpatrick, the executive director of iiss america. Falloutll discuss the from the g20 meeting throughout the morning on daybreak asia. With thato joins us perspective. Later, we will dissect numbers. Cpi and ppi this is bloomberg. All right, 45 minutes away from the japan and korea open. 4 following that rally on friday. The yen is weaker around 114. This is daybreak asia. Lets return to the g20 with iisss executive director. Talking about the g20 overall, we did get a communique, but it was split on various issues, trade, Climate Change. What trumpink achieved here as a win . I think President Trump is claiming that it is a victory. There is not a lot of substance behind that claim, but the bar was set very low. Just maintaining some corum in itself might be a victory. This was a dismal g20 summit. The absence of unity on the key issue of Climate Change is what will color this g20 summit and why it will go down as a failure. Talking about Climate Change in particular, there was a deadlock over the issue. President later saying his countrys ratification of the accord may not be justified or in doubt given the fact that the u. S. Is retreating from this record. Is this the beginning of some kind of contagion when it comes to the fallout from this deal . This in fact could be. When the worlds greatest economy, the largest power, pulls out, it cant help but have a ripple effect. All of the other 19 members of the g20 said they would proceed and the paris of treaty, president emanuel macron said they would be holding a twoyear anniversary meeting in paris, but peru friel players like turkey, its not that thepheral when they see United States refusing to honor its commitment, they asked why should they. This has a big impact on the ability of the world to stem the warming that is endangering the future of our children and grandchildren. Why dont we play part of what president macron said when he mentioned the u. S. Separating itself from the rest of the world. Hang on a moment. Disagreement is a with President Trump, and i said it publicly because there is nothing to hide. Not being said, it does prevent us from cooperating in many fields, and particularly terrorism, strategic interests. See eye toge extent eye and have cooperation. When you have one big country like the u. S. Not on board with make the 19, does that u. S. Less significant or make the g20 less significant . It makes the United States less significant. The g20 significance is a byproduct of the big story here, which is u. S. Isolation. Some were calling this summit the g 19 summit, all the other states agreeing on something, but the United States isolated. Pulling out ofes tpp, the other ways in which President Trumps isolationist arelses have played out really putting the United States in a corner by it self. When you say isolated, does that have actual Economic Impact . Certainly in the trade area in asia. China is picking up the pieces. China is coming in and already has got most of the nations of the region in line with its Asian Development bank, so the United States is really seating giving the field to china, and it would take a while before this place out in actual trade statistics, but it is a bad trend we are embarking on. Don trade. Two in there were some compromises, including the communique, steel overcapacity. Does this by some time for Global Leaders in addressing this issue or does it prompt the u. S. To propose these tariffs or quotas when it comes to steel imports . It by some time. One of thebe deliverables that trump got from the g20 summit, the commitment on the part of others to see americas perspective on the steel issue, so he is claiming that a victory, and in some ways it was. Does that lead to some type of looming trade war then . Not callwar, i would it a looming trade war. In the competition, the United States may have more difficulty, because when it cant lead with the respect and reputation that it has in the past, you will have repercussions in other ways. Thele wont be listening to United States as much come even when it has a good tale to tell. Great to get your perspective on all of this. You can get a roundup of the stories you need to know to get your day going in this edition of daybreak. On youryb terminal. It is also available on your mobile and the bloomberg anywhere app. You can customize your settings to get the news on industries and assets you care about it. Check it out at dayb. This is bloomberg. Offering 6. 3ing billion for a container carrier. Premium toing a 31 Orient Overseas internationals last close. It still requires regulatory and investor approval. The chinese plane maker has won approval to start mass production of its regional jet, with the first five due to be delivered by the end of the year. The plane has a maximum range of 3700 kilometers and competes with other jet makers. Orders from 19 asian airliners, but still needs approval to operate in the u. S. And europe. Klm air france says the turnaround is gathering strength with rising bookings than the return of tourists from asia and the United States. The group is still recovering the collapse in travel following terrorist attacks. Seen ticket prices declined by half and demand surge. Affected theel has mood in the business come and it is good. There is optimism. We do feel it for our business summer we see for this more people coming from overseas. Much more ahead. Congress by the fed, but what about the balance yvonne beautiful site on the arbor day site on the harbor today. Betty markets ended brighter on friday. A nice rally led by tech shares. Im betty liu in new york. Yvonne im it on man in hong kong. You are watching im is on yvonne man in hong kong. Heres our first word news. The biggest reason given for not supporting Prime Minister abe was a lack of trust in him as a person. The republican partys hopes of repealing and replacing the Affordable Care act has hit the rocks come with passage of any plan in doubt. Bill cassidyator declared the leadership plan a nonstarter. Son has eldest confirmed meeting with a russian leader with kremlin ties during the campaign. Donald trump junior says Jared Kushner and then Campaign ManagerPaul Manafort also attended the meeting at trump tower. Says theyork times did the meeting in hopes of learning damaging information about hillary clinton. Iraq says it is has liberated the Northern City of mosul from the Islamic State three years after its fall alerted the world to the groups strength. The offensive was launched eight months ago. Where the groups leader announced his intention to create a caliphate. Global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. This is bloomberg. Yvonne more on what we should be watching as trading gets underway in asia. We are joined by bloombergs Global Markets aeditor adam haigh. We did see that blowup number when it came to the headline job gains, but wage growth is still stagnant. Cool labor, not too market, is that going to be a further boost for equity gains . ,eporter by the looks of it the selloff we are seeing in bonds is rolling through to asia. Australia in 10 years is selling off this morning. Is a continuation of that statement of that theme we have had. Investors being prepared to just put all their eggs in the Global Economy and continued earnings expansion we are seeing across the world. If you look at the u. S. , often the earnings numbers are being downgraded at this point in the year, but they are holding up relatively well for the s p 500. It is that against the concern in the bond market that is driving the selloff of a more hawkish tilt we have got from central bankers recently. Theme ase of that same we start the week