Hello from sydney. This is daybreak australia. Its just after 6 p. M. In new york. The markets were closed today. The fireworks have not started yet. We are still several hours away from that here, but we saw some fireworks over the last few weeks in the markets. The expectation is where are we going to see when the markets open up tomorrow . Are these tech shares going to sell off and what about the dance we see from various markets, except australia. A very interesting statement that came out there. Lets get a check on how the markets are trading that you have new zealand opening up their. A softer tone right at the open. Housing prices look to be finally cooling off in new zealand. On the flipside, in australia, household that had the rba worried and a lack of wage growth, which is why you did not see the iba come out and do anything on rates and seemed worried about hiking anytime soon. Dollar see the aussie fall slightly after that statement. Australianch if the dollars does strengthen, which has been a complicating factor. Compoundingy policymakers, but not really into go against expectations. Not much of a hawkish tilt. Ake a look at commodities it will be interesting to see if geo politics continue to dominate headlines. Themtionally, we have seen brush off and be sanguine to the saber rattling coming from the north, but it feels like this target could be different. Drop on monday, the biggest loss of the year alongside strength in the u. S. Dollar. Essentially unchanged before we had those crude stock files fall back in the u. S. Ore, lookingiron at services pmi coming through today. We will see if we can get the stabilization picture a little more filled out with the rebalancing side of the story. Lets go to Rosalind Chin in hong kong. Pushing back against production cuts and will oppose the idea. Speaking anonymously, government officials said it would send the wrong message to the markets and suggest the cartel and russia are not sure the current agreements work. Russia is set to host members and nonmembers on july 24. Russia and china used the idea to discuss a investment end of up to 10 million. 10 ilion dollars. The new arrangement is intended for select projects and the China Development inc. Which represents beijings interest. Tarextended deadline for qa to respond to demands. No indication of what it contains. It includes cutting ties with iran. The foreign minister says he expects to reject the response but that doha could simply act now. We discussed the crisis in detail and i want to iterate that when there is one side leveling accusations against the other, that side cannot say yes, i accept everything you say. Is fighting hard to as theyts leader ship world lng producer. The company said it would raise output by 30 . Role asnforces their the major global supplier. And Peter Hancock will be the banks next ceo. The incoming chairman is considering internal and external candidates to lead operations in the board has contacted hancock of out it. It had drawn all of its previous leaders from its own ranks over 24 years up global news hours day powered by 2700 journalists in more than 120 countries. This is bloomberg. Pause here for a look at what is happening around australia and new zealand. With places like sydney and melbourne, we see these rocketing home prices, but that could be starting to ease. Guest we got the latest house prices for new zealand year on year, so that is slowing down from the reading we got last month. This is the slowest rate of theth is march 2015, but biggest city in new zealand and the epicenter of the Property Price madness, the average price 1. 0 5 million new zealand dollars, but a 0 increase for three months and a 30 drop in sales volumes. A few factors at play here. Foropping 40 deposit Investment Property and banks having tougher loan value restrictions as well as and there are some seasonal factors. Winter, amiddle of miserable time to be shopping. Haidi australia moscow petition regulator is looking for a bid for the struggling network. What is the latest in the ongoing saga here over 10 network . Paul two of the billionaire shareholders have put in a joint bid. The regulator now looking at shares that have cratered to . 16 and now it is the hands of administrators and it is awful for investors, but billion errors can be poised to snap up a bargain here. There is just one problem. This bid as it stands is not loud because of media ownership restrictions in australia. Lachlan murdoch would be breaching the two out of three will because he owns radio stations and newspapers in the gordonrket and bruce would be in violation of what is known as the reach will because he is a Majority Shareholder and he cannot control 75 of the broadcasting it covers 75 of the population. So this is a bet the media ownership laws are going to change. Those billionaires would he expecting that would pass. The regulator will make it decision in late august. Betty thank you so much. We are getting some breaking news here north korea this is more on north korea and the icbm they claim to have tested successfully, saying the intercontinental listed missile can carry a Large Nuclear warhead. This is what is feared the most by the americans in particular, where this Intercontinental Ballistic Missile can reach the shores of the United States. Carry a large can nuclear warhead. The Un Security Council is meeting behind closed doors to discuss this claim of a successful test. Northeast asia correspondent has been following these developments. How surprising is this . This is what is feared most by the white house, that these missiles can carry these Nuclear Warheads that can reach the shores, they believe up to alaska. Guest obviously alaska is not with 1. 7ly the target, million square kilometers of land, it would be the continental united dates or the threat of that. Isthe Ballistic Missile classified as traveling 5500 8000. Ters, seattle is but north korea yesterday saying its newly developed icbm can reach anywhere in the world. Bluster or is it real . We have to wait and see. The timing of the announcement and test is quite interesting because it is the fourth of july isthe united dates and their simmering more boiling u. S. China tensions after the 1. 3 billion arms sale to taiwan and other issues between the two countries. The chinese president talked about the rising negativity of u. S. China ties, so the timing is quite interesting. The Un Security Council at the urging of the ambassador to the United Nations will meet behind closed doors in an emergency session on wednesday in new york, but to members on the to permanent members of the Security Council, russia and china put out a joint statement on the north korea test today, calling on kym johnson to halt nuclear test, halt Nuclear Missile launches and largescale military exercises. Andng north korea apostate violate Un Security Council resolutions, but at the same time, the russians and chinese say they do not support any military action to resolve this issue and oppose the appointments of the antimissile system in south korea. This is not going to make china happy at all. We are getting breaking news south korea and the u. S. Will be holding joint Ballistic Missile drills, so a very fast developing story. Korea insuring it has a spot at the top of the agenda. As with everything that comes out of john yang, we are trying to parse out what is real and what is luster. What does the missile test itself tell us . That this is the 11th missile test so far this year. They have definitely ramped up their program and you have to wear that you have to bear the claims versus the reality. They claim that it hit target in the middle of the sea of japan, about 900 kilometers from the launch site. If you look at the altitude and the trajectory, analysts are saying that it indeed could be classified as an icbm, reaching into the 6000 kilometer range were even beyond as north korea has claimed. It looks as though from their test and the data we can see that this is indeed an icbm, whether they have the guidance capabilities, thats another question. North koreas own fireworks on the fourth of july. This fromare getting the state department, the u. S. Saying it strongly condemns north koreas use of an icbm, but the State Government saying testedan ice abm that a and it represents an escalation of the situation. The usa will never accept a Nuclear Armed north korea, making these comments in a statement from the state artman. You have been covering china closely and we know the economic and trade fallout could be severe. We are already seeing that. The key player here is the president china. He is meeting with putin and will be meeting with Angela Merkel and donald trump. His vivid to europe as well, he holds all the cards stuff ive been to the border in china and north korea and you saw plenty of goods going across that border from china into north korea. North korea needs china and china in many ways needs north korea as well. Lets bring up this comment from the japanese Prime Minister he had an urgent call for members of the Security Council and the Global Community to take more assertive action against north korea. At the g20 meeting where the World Leaders will gather together, i would like to strongly appeals for unity in the approach of the International Committee regarding the north korea issue. I would like to urge them to take even more constructive measures toward this issue. We will be on top of the story as it no doubt develops continually. Betty i continue to look at these headlines coming out it says u. S. Says north korea tested an icbm and it represents an escalation, so it looks like we are getting some confirmation. This is something that was threatened by the north korean dictator. How much of a game changer is this . Those whether he has capabilities to strike the United States, that has always been the threat, that eventually he will have those capabilities for if all of this is true and he has an icbm that can strike anywhere in the world dominated is a game changer. That is why use the russians and chinese come out with a joint statement saying they do not work any military strike in retaliation on the part of the united dates. They are referring obviously because that would escalate it much, much further. But if he has an icbm that can strike anywhere in the world and 8n go as far as 6000, 7000, house and kilometers in distance, i hate to pinpoint my hometown of seattle, but thats only 8000 kilometers away from pyongyang and a highly militarized area of the united dates. It is definitely a threat thankted full top betty you so much. We will continue to keep our eye on the headlines coming out of north korea. We will have much more on the tensions flaring up around the Korean Peninsula later on daybreak asia. Theill be joined by director of the center for conflict management. He will weigh in on this in about one hour from now. Haidi im haidi lun in sydney. Betty im betty liu in new york will stop you are watching daybreak australia. As we are watching the north korean crisis am we have our eyes on the middle east. The extended deadline for a response to saudiled demands are running out in the coming hours. Go hot delivered its response to the mediator in kuwait. The German Foreign minister says he expects the alliance to reject stop i want to ring in a professor of clinical science. Heard some of the middle east allies who have noted the demand from the saudi arabia led much. Ion, they are too they are unreasonable, so what do you think the response is going to be . Guest these demands are the ones that should be reject it expect them tod arecally say these demands acceptable. They would probably do that in the next 24 to 48 hours. Betty and respond with what leverage . Economic sanctions . Guest there are a number of options open to the saudi led group. It could push more toward turkey that is selfdefeating for saudis and their allies. One of the things they want is for qatar to break off relations with iran and move the Turkish Military base. The saudis could in gauge and military action. Myhink that does not to see seem to be on the horizon. Engage in somey emergency actions. It seems like there ought to be several steps before we get into the feasibility or reality of military action stop is there any sense at all that there some flexibility on the saudi arabia side or that it sounds almost impossible they are going to cut ties completely with iran, but what is the middle ground here if there is any . Guest i think the middle ground and have aown discussion about all of these issues and the United States will have to engage in more mediation. I think thats what the secretary of the state has said, to unite against extremism and terrorism and all of that. Not really bemay the case, nonetheless, i think theres room for negotiations and the only power could bring some degree of influence is the United States. It depends on what the Trump Administration is going to do at this point. Haidi domestically after that hoardinganic with the following these developments, it seems like it continues as usual and if anything, it has caused residents and civilians to rally around the flag stop do you think it is dangerous that this is giving rise to a stronger sense of patriotism . Guest this is what i keep tar. Ing from qa itsgovernment has hardened prepared tois not capitulate entirely to their demands made, but at the same time, this will have an Economic Impact and already, billions of dollars have been wiped off the stock market and they will have to pay more for the importation of food and other basic commodities that they require. In terms of the trade military, itds and is not business as normal. How sustainable is the situation . Guest i think they can do this and i think it is sustainable because the airspace with iran taropen, particularly qa airlines. Two other members of the council have not broken off relations and have not participated in the siege and i think kuwait hes are doing Everything Possible to act as a mediator, but whether they are going to be successful and have an understanding around some of the issues, that remains to be seen. But it is the United States that holds the important cards if there will be some kind of settlement. Betty what do you think the u. S. Should do . Guest it is important for the United States because one voice. We have had contradictory statements coming out of the United States. President trump will say one thing and a secretary of state will say another. Washington is sending confusing message sending confusing messages to the region and it could make it more dangerous, but if washington has that willlicy, then ratherth a united voice than contradictory statements coming out of washington. Not ani know you are economist and i know youre not an expert on what is going on in north korea by any means, but im curious in your view, whats a bigger threat right now . Is it this brewing crisis that seems to be dividing the middle east there are two factions here vying for dominance, or is it the crisis ruing in north america . Whats the biggest threat to the Global Economy right now . Guest , the korean thing is one, but at the same time, we have a levy conflict going on in iraq and syria. We are facing a very dangerous it can have a serious impact on the World Economic situations. Thats obviously going to have i impact on oil prices and think that could have a serious impact. Betty thank you so much. Just recapping quickly, the comments we got from secretary of state Rex Tillerson. In a statement moments ago, saying north korea did indeed test an icbm, that represents a new escalation threat to the united they come our allies, partners, our region and the world. Bringing. S. Will be the provocative action before the Un Security Council and the president are continuing to assess the situation. We have heard a Global Response to what we saw yesterday. For cam says he will be sending a gift package to the u. S. More frequently, so provocative comments from him. This is bloomberg. Open a 19 minutes in sydney. Setting up to be a Beautiful Day in sydney. 0. 1 , thoughng at we are looking at a fast developing situation, the response to north korea. Headlinese of the coming across in new york, 6 30 and new york. Let me recap the headlines. Jongnam will be giving a gift package to the United States recently, and icbm capable of hitting the u. S. In 2017. These the latest headlines. Lets get more with rosalind. Reporter and one from it says his country once in his speech of the national assembly, he promised that Government Spending in france would fall along with 23 billion of tax cuts. France has underperformed in the eurozone for three years. Bank seeing adest bailout goo. Failed to raise funding from investors. A crisis eraping legacy of 350 billion of soured loans. To put the bank back on track with the market valuation which not only we do fear but we also believe will be positive. Maximize value 10 backs of my stakeholders. This is a goal that will be rapidly pursued. Reporter new zealands soaring market posted its weakest price rise last month in more than two years. Home prices ro