One china policy should be tied to trade. Prices, this Historic Deal to cut output. Oil jumping over 4 . Jumping to the highest since july 2015. Saudi arabia signaling it is ready to cut output more than agreed, while a nonopec countries including russia agreeing to pump less. Sophie we will have more about that deal in a bit, 30 minutes away from the open in china and hong kong. Singapore, taiwan, and malaysia coming online. What is going on in the oil patch . Game inhere is only one town, and it is demolishing every other safe haven. Gold retreating, bonds falling, all on the account of renewed Risk Appetite after the meeting between opec and nonopec members. Saudi arabias surprising the markets, saying it is willing to cut more than pledged. Russia and other noncartel members coming on board as well. Stocks, oil Energy Stocks leading the gains. Energyheavy markets like a straight up, the nikkei 225 getting that double boost, oil majors leading gains, but the impact of a weaker yen, pushing that 116 handle. Online, some strength straightheast asia, times index up. 3 , and energy heavy market. A quick note about south korea, that in treatment vote go through on friday, some uncertainty the next couple of months as the Constitutional Court has 100 80 days to decide whether they will support the proposal. Isote from s p saying it unlikely to weigh on the rating when it comes to south korea, Political Uncertainty will be fleeting. 1 gain. Dollaryen looking like this, one 16, boosting retail names. Oil surging to the highest in 17 months, and that conversely driving further close from gold. A 20th day of contraction when it comes to bullionbacked etfs. That selloff is continuing there. Sophie thanks. Opec and the fed driving markets this week. Rishaad lets find out what else is going on. Bill english has been named the new Prime Minister of new zealand. He was elected unopposed after tubing rivals withdrew, and Paula Bennett will be his deputy. He succeeds john t and inherits a solidkey and inherits economic platform to campaign on ahead of the general election next year. Japans core machine orders jumped from the previous month with a gain of more than 4 , the first such rise in three months, however still down more than 4. 5 from a year earlier. 4 on aprices jumped monthly basis, where analysts had seen a fall. Chinaas for decade one policy may change with president elect donald trump saying nobody can dictate to whom he speaks. The issue surfaced after beijing leader tookter the a phone call from the president of taiwan. Trump has threatened to impose tariffs on imported goods and label china a currency manipulator. He says china will now have to play by the rules. Christine lagarde goes on trial as french her time finance minister, accused of failing to prevent a government payout to a corruptiontainted tycoon for mishandling the sale of adidas. 300 millioned dollars, which Christine Lagarde did not oppose. Global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. This is bloomberg. Thanks. First word headlines. Sophie opec sealed its first output cuts with independent producers in 15 years as Oil Ministers agreed to reduce output by 1. 2 Million Barrels a day, saudi arabia willing to cut production more than expected, promising a cut of 450,000 barrels a day. Say the situation is different as we go country by country, but i was pleasantly surprised to see so many countries respond to the invitation by opec and russia to participate in this deal to stabilize markets. Most of the countries which joined, and it is important to say they joined voluntarily, some nobody will force them to reduce production, and most of these countries will be taking active measures to reduce production, and that is important. We wanted to contribute in as the reality of the transformation of mexico was also accounted for, so this is also part of the process of production decline that we have experienced over the last 10 years, and what we have done is a managed process of the klein which will stay consistent with our own production targets. In beenlets bring sharples. Nonopec producers agreeing to cut production, and saudi arabia saying something as well. Opec and nonopec coordinated a production cut, almost 1. 8 Million Barrels a day. Was thei statement cherry on top essentially. They said they will cut more than that what they were initially going to come i bullish statement, and prices react. Rishaad it has failed in effect , and there are risks going into this. The compliance is the Biggest Issue. Anything about compliance until february or march. The other thing to look for is how the u. S. Responds. Fromve weekly data points the drill rig numbers to production numbers, and whether it will incentivize production there. The policy is to try to drain those stockpiles at historic highs rather than push up prices. They are hanging around the mid50s at the moment, and will probably continue into early next year, but bullish for the market. Sophie thank you. To the Federal Reserve as it heads into its final meeting of the year, little doubt over what policymakers will do. Rishaad a rate hike fully expected, traders turning their attention to next year. In new york. Is its all about joining the dots on wednesday. The dot plots will be important as they wrap up their a. 25 percent Interest Rate hike is what the markets are expecting. They want to see the latest version of what you are seeing on the screen now. 2017. In september, they were looking for two Interest Rate increases and. There were two fed officials who saw no hikes at all, and then you move up the line, 3, 4, maybe five next year. Will there be more of a consensus . The fed is meeting after unemployment hit 4. 6 , a nineyear low, so they are putting together the steps of Economic Projections that include those dot plots. Inflationsee higher because unemployment has fallen so low . That could mean more rate hikes. If you start with the question of unemployment, maybe they will say, well, its going lower, but because there is labor markets slack, we can tolerate that. Will day forecast more rate hikes next year . That is the big question, and what could be the market mover on wednesday. Sophie you are saying some potential policy shifts, but will the latest economic reports make a difference between now and 2017 . All about momentum. Bloomberg intelligence sees moderation in the data. Can we look at 4941 . Consumer sentiment had its biggest twomonth gain since january 2012, that yellow line on the bottom. That white line shows a jump five points to 98. Survey respondents added that they are more optimistic, the king at the impact of policies coming in the next administration. For the Federal Reserve, this question of what donald trump does and how it affects the economy is a source of uncertainty. We will see if that shows up in the fed forecast and policy statement on wednesday. For that. Hanks a lot Kathleen Hays in new york, watching the fed. China setill ahead, for a triple dose of economic data. A preview with morgan stanley. Guest saysw an next it is an uncertain time for emergingmarket currencies. Will the uncertainty continue . We have more with hsbc just ahead. This is bloomberg. Check ofright, a quick business flash headlines with hyundai merchant marine, share to the upside. Why . It did announce it will join the biggest shipping alliance on a limited basis as the company tries to expand operations after being taken over by its creditor. Will share space with the two m group. Approval,egulatory but hyundai merchant said it would improve competitiveness. Sophie qantas to start regular nonstop flights between perth in london, a 17 hour direct connection between australia and europe. It will use the boeing dreamliner. Allow services from australia to dallas or chicago. Rishaad donald trump warned jobs are at risk if he tries to curb chinese investment. Chairman wangda jianlin saying i invested over 10 billion. Sophie emergingmarket currencies paring ahead of the fed meeting, taking pressure from the administration change in america. Rishaad expressed it to boost inflation and trigger rate hikes are i. What is going on here . Good morning. Stillnow, everybody is trying to digest what donald trump means for the u. S. Economy and the rest of the world. There is still uncertainty, but we are going with this translation type of trade, which means a lot of the asian economies that have trade links with the u. S. Are under pressure. At the same time, some of the commoditylinked currencies are doing better because of this infrastructure demand helping commodities. Sophie with the expectation that the fed will hike faster next year, what will that mean . The fed is projected to hike faster than earlier expect that come up at markets are basically areing in what the fed dots projecting. Until and unless we get beyond that, actually some of the higheryielding currencies will hold up well. Rishaad we just have the yuan, weakening it again. What is this reacting to . Moves . He dollar or euro things. Post the fixing mechanism has been in line with the broader dollar movement, basically meaning theareuro, dollaryen, currencies that are important in the basket. , the basket has been stable, so this suggests yuan fixing has been not as high as it could otherwise have been. Has been leaning against it to cap it below 6. 9. Sophie what else is driving that sentiment . Outflow pressures, impact seasonal two to the idea of the u. S. Economy picking up. Tryingnese investors are to invest abroad for the first time in many years. Naturally they will be looking , and what it going on globally will matter for capital outflows. Rishaad the capital outflows story is the big story at the moment. Europe is chinas biggest they areartner, but trying to keep a level Playing Field with the europeans and the , andrather than the u. S. That feeds into the whole dollar feed, and how does that into the emerging markets story . Economiesg market have reacted to chinas changing dynamics. It became a excepting to the need to depreciate. To the extent that the renminbi near Dollar Strength, that fear to acceptance mentality will continue. It is only when we get beyond that and the renminbi started to depreciate more that we might get this negative spillover. Are saying two pillars on which currencies have been able to Gain Momentum this year have been knocked out of play with Donald Trumps win, so setting up for 2017, what could be another pillar they could lean on . For 2017, the business cycle. Donald trump inflation theory is gaining momentum, because pmis have ked up, that by the u. S. Not only will donald trump reboot the economy, and it was picking up before he gets into office, and that might help does not and if it trump protectionism comes in, we get the worstcase scenario. Rishaad which ones will get it most. Your underperformers include the renminbi, turkish lira, and the ringgit in malaysia. Definitely. In asia, the singaporean dollar, the ringgit, the korean won well get hit hard because they are plugged into the chinese production chain, so if there is going to be trade tensions between the u. S. And china, these economies will be hit. These economies are also going to some of their own domestic issues. Korean Political Uncertainty, and to a certain extent the renminbi. Rishaad thats what we have at the moment. Thank you for that. We didnt get to the preferences thai bhat and the philippine peso. Heading closer to that seven handle. Sophie up next, new zealand confirms its new Prime Minister as john key steps down. We will look at what is expected from a building this government. This is bloomberg. Sophie new zealand has a new Prime Minister, bill english was elected unopposed as the leader of the governing national party. Rishaad he was endorsed by outgoing minister john key. Hound different is a bill english government going to be if different at all . Over not particularly different is the answer. Bill english is the continuity candidate, the finance minister under john key and was anointed by john key as well. Such overwhelming numbers that the other two contenders dropped out. Much changet expect apart from a reshuffled cabinet before christmas. Stephen joyce will be the likely new finance minister. At the press conference after he was voted the party leader and by extension the Prime Minister, bill english had nothing particularly radical to say. He did take questions about new zealand on the International Stage and said he hoped the country would continue to be an honest broker. After all, we are a small country. Because of the increasing recognition of our good economy, open to trade, political stability, we are not having to deal with some of the difficult issues other countries are. I think we can have more influence in a positive forward thinking country. One difficult issue to mystically as housing affordability, the cap between the rich and poor is getting wider in new zealand, so we could see that shape up as a potential election issue next year. Yet, butothing radical bill english will face an election and the next 12 months. Can he win it . Looking goodts for him. The government is still in or mislead popular, and more popular than the opposition parties combined. It really is looking wishes of election to lose, if you like. Historically, it could be difficult. Gore has been no government four terms since the 1960s. Englishs biggest handicap is simply he is not john key, a normatively charismatic and popular. This will level the Playing Field because there is no one particularly charismatic on the opposition benches gone tobut 2017 has looking like a lock for government to a much more interesting contest. Thank you for that, paul. Paul allen there. Lets have a look at the oil price. This is the biggest show in town after the deal between opec and nonopec producers to cut output. Sophie it would seem there is momentum towards that 60 handle. We have not seen that in 17 months. Rishaad we will talk to neil beverage about it, saying what will it take for that oil price to edge up to that 60 handle . We have it jumping to the highest level since july 2017, it was nonopec countries including russia green to pump less as well. Sophie we will hear exclusively from Vladimir PutinsEnergy Minister, Alexander Novak. This is bloomberg. Sophie this is Bloomberg Markets asia. I am sophie kamaruddin. Ishaad i am Rishaad Salamat having a look at this data dump tomorrow 10 00 a. M. Hong kong time. Retail sales essentially. Sophie retail sales, factory output, and fixed investment. Expecting a 2 rise. Retail sales, that dip right there, but expecting an improvement. Rishaad were looking at what a 10. 2 percent year on year rise at the moment, and the previous month there of course. Sophie factory output another data output point, the blue line, steady at 1. 6 for a Third Straight month. Rishaad it is the first trading day of the week for shanghai and hong kong. I just want to talk about fixing, significantly weaker to kickoff the week. Tends to moveore more than the onshore number. 6. 9351 is where we are at the moment, but weakness to the tune of 10 so far. Lets go down memory lane in terms of where we have come on this chinese currency. 5. 6 at that leg weaker, when it comes to the year to date depreciation if you will when it comes to the renminbi. Lets take a look at the open, joining i believe the regional rally that has been boosted the oil story, saudi arabias what ever it takes moment, russia and other nonopec members on board, crude rising for the highest in 17 months. We are seeing this risk on appetite flowing across equities when it comes to the asian session. The greatest gains from the nikkei 225, getting that double whammy from that weaker yen, 115 handle on the back of the dollar. Holding ontodex its gains against emergingmarket and asian currencies. , upgreater china open. 1 . We had a big data leak last week , but we have the data numbers on domestic activity this week as well. Hong kong up by. 3 . We had the intention to not run , then saw on friday that bounce in the hang seng index, now extending those gains. Heavy up. 25 , Energy Markets doing nicely and nice buying when it comes to sydney stocks with the oil majors seeing hefty gains in the early session. Lets look at the rest of the movers, in that energy space, beach energy up by 3 . Crude continues to surge. , thiso have interestingly retreat when it comes to precious metal, gold falling, futures the lowest since february. Shrinkingts for 20 straight sessions. Australian gold miners on a losing streak. We are seeing funds flowing out of safe havens, government bonds as well from australia to tokyo. Jgb, yieldsear rising the most since february. Sophie thanks. Checking in on the markets for us. Rishaad checking in on the first word news headlines. Rosalind south korean President Park geunhye facing new accusations after being impeached. She is said to have colluded with a former aide who tried to force company executives. She loses her immunity after she leaves office from prosecution. The Constitutional Court has six months to rule on the impeachment decision. Indias boardroom drama now sees tata group accusing cyrus mistry of breach of governance and failing to distance himself from companies owned by his family. It comes ahead of extra day meetings at the tata unit, where each are appealing for support. Boeing has agreed a 16 billion dollar deal with iran, the first including, includes multiple aircraft variance. It will force president elect donald trump to balance diplomatic priorities with american jobs. Tension is high with Donald Trumps crit