It is past 9 00 a. M. In sydney this is daybreak a australia. The first major market at the start of this brand new trading week, and we are not getting much of a lead from wall street at all. Ramy not yet. It is 6 00 p. M. On new york. Good to be with you. We will be looking at all of the action on wall street through the past week and how it will pay into the play into the asiapacific trading day. With you guys and Rex Tillerson hanging out in north asia, it will be interesting. Haidi that is right. We have the g20. A lot of action to pull over. Mull over. The key phrase in the g20 communique, interesting to see how that goes. Lets get a recap of what happened on friday. It was a lackluster session in the u. S. Ramy take a look at where we stood. The s p and the doubt both down. The dow both down. They were down two days in a row. The nasdaq was unchanged. We have a couple earnings things on tap here. Janet yellen will be speaking in washington dc. We did hear from her last week as well as the central bank. Got that Interest Rate rise, see what all she had to add. Haidi that is right. A lot of analysts are looking at that. There is also a welldeserved breather. We had record high after record ofh and a time of ton risk events on the thing. We have had new zealand under way, a bit of a miss it comes to the Work Confidence numbers, less than expected, private numbers. Futures in australia also a bit theer, 13 points lower for close, the aussie dollar hanging in at the 77 handle, the dollar index now down for three consecutive sessions. A quick commodities check, gold looking pretty flat at the moment, wti low, under the 50 a barrel mark after russias that is too early to duck about extending the cuts despite the sentiment being raised by the saudi energy minister. We have a bit of a downside when it comes to commodities as welfare lets get you caught up with first word news with Rosalind Chin in hong kong. Rosalind one of south koreas most powerful corporate families will be together for the first time in years later at this trial. The face charges including embezzlement and more in voting to a billion dollars. Amounting to a quarter of a billion dollars. The latest opinion poll in france puts Emmanuel Macron in equal first place ahead of first round. 26 support here. The famous for right leader, marine le pen. The left wing has the same backing as others on 12 . Macron is seen as beating le pen in the second round. Japan and russia beginning direct flights to allow former residents a chance to visit. Discussed thehave development of the island, the northern territories in japan and Southern Islands injured russia. In russia. North korea claimed it has made a revolutionary breakthrough in Space Technology with a rocket engine. The leader was watching the test it was aend, saying great event of historic significance. North korea is banned by the United Nations from conducting longrange missile tests, but claimed this is for peaceful use. Spendingnmentalist years fighting the rise of the suv, but the battle is all but over, and the suv has won. In australia, these vehicles overtook the passenger cars last month following a similar picture in the u. S. There the most sold in december and january. In china, the sales surged when 5 last year. Global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. This is bloomberg. Thank you for that. Paul is here to take a look at what is happening around the region today. We will start off in new zealand , talking about the Largest Construction Company taking quite a hit. Paul it will take a fairly hefty ride down to 50 million on a couple of major projects. They will not say which ones, but there is plenty to choose from. They have the contract for new zealands largest building projects, a Story Building in auckland and convention center. There could be literally anything, but the Earnings Guidance has been downgraded to 420 and 450 million, u. S. I dont think the issues are systemic but primarily related to program and design challenge and a small number of major projects, but the shares taking a beating from new zealand, off 12 right now, listed in australia as well. Down in newly zealand. In terms of politics, we know it has been pretty tough going for the federal government over the last few weeks, but there could be a ray of hope. Paul a ray of sunshine. The polls in australia have been more accurate than other parts of the world. But the Labour Party Still has a lead, 52 , to pretty preferred. Liberals have narrowed that on 48. Looking at the primary vote, the liberal party has a lead, 37 to 35 in the last poll, they were trailing. Malcolm turnbull well out in front as preferred Prime Minister. This will no doubt make the Prime Minister feel good because it was poor polling numbers that prompted him to ask his predecessor oust his predecessor. Be a trade could boost in store for australia as well with the primates chinese premier visiting. What are we expecting . Paul this is the highest level visit in china we have had since xi jinping visited in 2014, and that was to sign the Free Trade Agreement between the two countries. So this should iron out the wrinkles, and there are a few. Barriers,behind the behind to the borders of barriers, some Agricultural Products in particular, chilled beef is a good example. Chilled beef exports from australia to china worse is 2013 wereely in suspended completely in 2013 because of the competition. There are 10 factories in australia license to export this product to china, which the australian Agricultural Sector sees as a potential Growth Market for it. That might be one of the subjects up for discussion when he arrives. He gets here on wednesday. Then he is here for the weekend. Ramy you will be busy then. Thank you. And in the United States, the Trump Administration made its mark in germany, despite coming ill prepared. The battery battle of brexit is going up. Kathleen hays is here. First to the g20 here, and what extent is this final communique really a win for the secretary of treasury . What a weekend. You had much more to do than watch mark redness. March madness. Ramy there was a lot of pushback. The person went over to germany to meet with his counterpart talking about trade and always issues for a long, long time. He is new to the secretary position, and all of the positions have not filled in. Bloomberg news had already reported that the u. S. Was going to get the g20 to drop its antiprotection warning from its statement. The new statement includes this much water down sentence. We are working to strengthen the contribution of trade to our economies. That is the most it could come together on. Here is what the treasury secretary said about the u. S. Position on trade. We believe in free trade. We are one of the largest gets in the world, one of the largest trading partners in the world. Trade has been good for us and good for other people. Having said that, we want to reexamine certain agreements. Comments,in many apparently, at the event, the finance minister from germany said, he did not have a mandate to make any big negotiations. Everybody seemed to understand on a similar news agency from china that the finance minister hin agreednd mr. Mnuc on economic cooperation. Everyone says, we have another summer coming up, they will have things straightened out. So you understand, something about why the United States is pushing so hard, lets jump into bloomberg and look at 4785. It looks at the trade deficit for the United States, the blue shows the surplus in services. That is smaller than the large deficit that has gotten bigger for so many years. As of the white ours going down. That white line shows you the trade deficit, where it is now. It has been narrower. Right now 42. 5 billion. That is the story of angst the Trump Administration feels. This is what they are pushing back against. A few other stories, that America First policy is opening the door to e. U. And china trading. That is interesting. There is a lot involved in the air. It will be interesting to see why july where they are. The trump team on trade made it clear how like they want to do alateral stuff and still have trading system, free trading system rather than the antiprotectionism stance. Ramy water finds the past path of least resistance. Minister. K. Prime theresa may also in focus because of her battle for the brexit. What is the latest . Kathleen this is not a unique a new story. That you will not have trade talks until the u. K. Will take an exit half a sickly. They oh the e. U. Money they say. It is about 60 billion euros. The u. K. Is pushing back. I say, we dont agree. Not because they are in a negotiating position. In the g20 meetings in germany, the e. U. Commissioner for economics and finance had this to say about the kind of deal the u. K. Can expect in brexit. Club,ng a member of the and the british have invaded the club, have to be better than being out of the club. The situation after brexit cannot be as profitable, as good , the situation before brexit. Kathleen lets move ahead to Something Else bedeviling theresa may as she tries to figure out this brexit. This is from Nicola Sturgeon, of scotland, who said the scots need to have a referendum on independence again. They cannot wait three years as theresa may wants them to. They need to vote for the actual brexit. If the u. K. Is going to leave, they want to have a say over how this works. Sturgeon is pushing for a vote sometime after early 2019. The conservative party also wrapped up a two day conference. Theresa may saying the scottish vote is bad for the u. K. , bad for the scots, that for us all. The latest survey showing 44 of scottish voters favoring independence. They may not want to vote, but almost half are saying give it a go. Haidi we have got a very, very busy calendar ahead when it comes to the global macro front. What are you looking at . Seven fed speakers. If we did not get a lot from that rate hike and all of that last week, we will get more this week. Janet yellen speaks thursday in washington. Very,on monday, gilchrist who was the president of minneapolis, he speaks. Charlie evans, also a voter on the fomc, and fringe candidates are debating on French Television ahead on monday. Prime minister abe from japan, Angela Merkel will talk trade in asia, and Nicola Sturgeon will start the movement to seek section 30, which would allow solid scotland to go to the u. K. And leave the united kingdom. Anotherahead, we got mention of the central bank on thursday, the reserve bank of new zealand. It is having its meeting. Haidi a lot of fed speak in particular. It will be moving the markets. Thank you. Still ahead, white china may not actually be working home prices as continuing to rise. Ramy china looks to australia as the u. S. Turns more protectionist. We will see that more. This is bloomberg. Ramy we are counting down to the sydney open, futures looking like this, down 0. 2 . Haidi i am haidi lun in sydney. Ramy i am Ramy Inocencio in new york, you are watching daybreak australia. The chinese premier will make his first trip to australia since taking office in 2013 on wednesday as part of efforts to promote free trade. Tom mackenzie joins us for more on this. What are both sides hoping to get out of this trip . This is the most highprofile visit by a chinese leader since xi jinping visited in 2014, and both sides trying to transient championed free trade, push back against protectionism. We heard it from the chinese policymakers during the National Peoples congress. We heard it from mr. Chang when he gave speech conferences, and the australians are concerned with push back against protectionism since the u. S. Pulled out of tpp. They will likely talk about the regional trade deal that china is championing. For the australians, they have always had this problem. The have the u. S. , Strategic Interests that they have to salance with economic interest with their largest partner, which is china. Stuff tol a lot of discuss. It is about championing trade. The other thing is australia is in the process of putting together its first white paper on Foreign Policy since 2003, international relations, diplomatic ties. It is likely the chinese will want to have some impact on the formation of that, and sure the chinese and the relationship plays an Important Role in that white paper. And we have the attention australia itself. Itself, not to mention logistics as well as australia. There are tensions and opportunities as the u. S. Pulled back. It comes, asting you mentioned earlier, as the e. U. , russell than beijing, look to strengthen their ties around trade. It has called for a trade deal with those sides, but a lot they need to work out as well, not to mention concerns and pensions, textiles. Europe, australia,europe, austrl trying to [please stand by] a lot of unhappiness over the language of that communique. They are repositioning as the u. S. Is shifting, going away from free trade. How is that playing out in china . We took a trip down to southern china, guangdong, the manufacturing heartland of china. We went to a city called h uaijo. Wages have increased, demand relatively flat, the Raw Material Prices have gone up, but for many of them, shrunk trump has to be a threat. They are looking to move to places like myanmar and the it not. We spoke to taiwanese offices looking to move to other offices in the region. Take a watch as to what we found out with this city in southern china. This scale isn this delicately coordinated deathly molten glass, blue pipes and more. It used to be used to be worth it. It is now more expensive and cooling demand means profit going up in smoke. Now they have to contend with new trade tensions. 90 of the glassware made in this factory ends up on shelves in places like home depot and lowes in the u. S. Any tariffs imposed by donald trump on chinese exports would kill business. Town, past the hoax of shuttered factories, this person has made his decision. He will move his factory this year. The new u. S. President was the nail in the coffin. The uncertainty has been increasing ever since trump took office. We dont know what he is capable of war planning to do. If you take any further actions on controls or tariffs or businesses, more businesses will be forced to leave china. Tom this factory which makes plastic casings used to employ 800 people. Now there are just 50. And the neighboring city, 49,000 factories closed in 2015 alone. He says many taiwanese are now looking to move. It has become really challenging to operate a factory and manufacturing in the pearl river delta region because of the ever rising costs, especially the labor costs. China is steering away from lowend manufacturing. Other countries will pick up the backbone. That means better jobs for the next generation here. These workers are on board. I certainly dont want my kid doing what i am doing now. I paid for him to go to university because i want to find a proper, decent job in the future. Tom the molding of the sector was long underway before trump came to power. ,he policies are another capitalists fueling the change. Up next, Cathay Pacific experiences antitrust turbulence. Details ahead. This is bloomberg. Ramy a quick check of the latest business flash headlines, Deutsche Bank expects to raise 8. 5 billion after posting its new shares sale. Is 690 million new shares at 12 a piece, 30 discount from the friday close. Changes oned the march 5. The ceo reversed strategies after saying he did not want to cap shareholders. This group is entering the Cloud Business by forming a partnership with ibm. Ibm will introduce the one sentence Computer Services to the mainland, allowing chinese businesses to have access to Cloud Infrastructure and Language Services that allow consumers to talk to apps. Other watson things are planned as it evolves. Ramy Cathay Pacific has been antitrustmillion for violations by the european union. It relates to cargo surcharge levels, which they say breached competition laws. They announced their first annual loss in eight years last year and say they will cut Management Level positions by 30 . It is reviewing the e. U. Ruling. Haidi we will look at chinese home prices next. They are defying restrictions, the property code put in place in various cities, heating up in february. Not so good for the attempts to avoid an asset bubble crash in china. We will run through these numbers haidi it is 9 30 a. M. In sydney, markets open in 30 minutes time. We are looking like a little bit of a lower open, down 0. 2 , fx futures up 13 points from friday. I am haidi lun in sydney. Inocencio in new york where it is 6 30 p. M. On sunday. Now looking at first word news. Rosalind chancellor Angela Merkel and shinzo abe have called for a concerted effort to defend free trade. After merkel held what was and includes elusive and inconclusive talk with trump, they say the market can be open and fair. They weres eating up the signal technology show. Chinese home prices have moved in more cities despite increases on property restrictions for the 56 , compared with 45 in january. On friday, beijing raised down payment prices between 60 and 80 . Cooper has confirmed as president is leaving the company. It follows a he had become tired of the growing