For the first time, but economics continue to struggle. And hsbc chairman says china is managing change extraordinarily well. He tells us what he thinks of trump policies. Indeed, thats going to be tracking markets, front and center, we have the whole Federal Reserve issue to be dealt with in the next 24 hours. Theres a 100 expectation that there will be a rate hike, its about what is going to happen in 2017. They say two rate hikes coming up. We can dive into it and see what weve got right now. The next rate hike possibly being as soon as february there as well. 86 chance of that happening after this one which is nearly a 100 probability of the high taking place there. Fed pretty much front and center. Seems like its going to be normalizing. We are 30 minutes from open in china and hong kong. Singapore, taiwan, just coming online. Heidi, how are the markets looking . Were looking a little bit mixed at the moment. Tokyo shares falling into the red, extending losses over the last couple of minutes down by a quarter of one percent. We do have a slightly stronger situation happening at the moment. Still, not surprising we didnt have that improvement in Business Sentiment that came in better than what we were looking for last month. This is what were seeing elsewhere around the region. Strong gains coming through, up by. 7 . Year seeing an interesting otation. Health care, utilities doing well today, basic materials falling, weve had declines overnight in iron ore and steel, thats driving materials stock lower. Taiwan also doing quite nicely. Lets take a quick look at the currency situation. We are expecting traders are expecting the u. S. Dollar to hold steady going into the fed decision. We might get some moves as the press conference, but so far a little respite when it comes to currency markets. Were also seing the aussie ollar looking like this. Thank you very much indeed for that, heidi. Lets get to the news. Thank you, sophie. Australias mccory group is leding a 5. 5 billion takeover bid, topping an offer. They said the consortium is offering 3. 40 australian per share cash plus a share in a new wagering company that may be spun off that i say it hasnt formed a view on how the offer compared. Legal casinos are a step close for the japan after an Upper House Committee approved new legislation. The bill is now expected to pass a final debate in parliament on wednesday, opening the door to potentially billions of dollars of investments. However more legislation will be required before any socalled integrated resource can be built resort can be built, meaning none is likely to open in time for the 2020 tokyo olimp exs. Johnson johnsons proposed takeover of a swiss drugmaker is off. Europes largest firm rejected the approach but talks resumed when j y raised the price to more than 250 a share. They were talking a full takeover but the company wanted to remain independent. The two sides have failed to reach an agreement. Indias decision to scrap high value notes sees inflation rising at the slowest pace in two years. They rose by a less than expected 3. 6 last month as vegetable prices fell. Signs of a prolonged slowdown ould push r. B. I. Into rates. Global news 24 hours a day, powered by more than 2,600 journalists and analysts in more than 120 countries. Im tom mckenzie, this is bloomberg. Were look at manufacturers, these large manufacturers in japan, theyre feeling a little more confident about Business Conditions. The biggest investment falling shy of expectations. We have the latest, give us headline figures first. Right now were seeing mixed data from the survey. Confidence levels differing depending on how much boost you get from weakening yen. Large manufacturers are considered a barometer of japans export industries. Theyre getting a huge confidence boost. Take a look at this chart. You can see for a large that for large manufacturers, since the launch, their confidence level has soared. When the yen started to strengthen around the beginning of this year, confidence levels a little bit down. Now that the yen, remember mast month, tropping the most against the dollar. Since 1995, that will be the line right there. Confidence levels now picking up, coming in line with estimates at 10, also improve from the previous three quarters when it stayed at six. Another thing for nonmanufacturers, though, our confidence levels staying flat at 18. Also falling from the june quarter when it was slightly better at 19. The outlook is mixed, the outlook for large manufacturers, Business Conditions will get better, not so much for nonmanufacturers. But you mentioned Capital Spending. This is tricky because on average, companies are planning to boost by 5. 5 this fiscal year, which falls way short of analyst expectations of around 6. 3 . What did the survey tell us, they said, stuck in a rut still. Now four years since that began, whats the report card rooking like overall . Pretty mixed i would say. We saw the economy just plunging into recession because of that sales tax hike which was well intentioned to cut the deficit but then again, were now seing a bit of positivity coming from a weakening yen given the new policy of controlling the yield curve. All eyes next week, what they will do if we continue to see weakening yen. That could be positive for inflation. But so far, the missing link has been Capital Spending. Why arent these companies feeling confident enough to boost investment and our Bloomberg Intelligence team saying because of demographics, because of the fact that Commodity Prices are volatile. Thanks so much for the latest on the survey. How about ja pan. Rate hike on wednesday is whats going on with the fed, and two next year is whats expected to announce after the meeting. We could get expectations of a trump spending boost to the economy, that could change the timeline. Katherine is in kathleen is in new york with more. Done deal, slam dunk, whatever you want to call it, 100 odds the fed will be boosting the key rate hours from now by 25 basis points. A stream of fed speaker saying its appropriate to hike rates now, put janet yellen in that camp in her most recent remarks. So data, better retail sales, good numbers on the labor market, all these are helping. Lets jump into bloomberg one ore time to look at 31 to to, as of a rate hike. Look at the last few weeks since november 21, those rate hike odds at 100 . Now, adding to this, a Bloomberg Survey of economists den by our team in washington suggesting the fed will continue to take a gradual approach to hiking Interest Rates. The Economist Survey see two Interest Rate increases in 2017. Thats what the fed forecast at its september meeting. They dont even see a hike until june. If thats not gradual, i dont know what is. Is there a risk to gradualism . A former fed Bank President said there is a risk and former fed chair Alan Greenspan said you have to watch the labor markets. The labor force is running out of extra workers. The Unemployment Rate is under 5 . You cant go very much lower, hich means that the 150,000 to 200,000 increase in payrolls a month is not going to continue on because were running out of people. The fed will give us its latest view of the economy and inflation. It has a sum mear of economic projections, we last heard those in september. The december projections will be announced when the fed releases its policy statement. Economy, inflation and the path to rate hikes next year, watch that more than anything else, does the fed signal anything more or less on rate hikes for 2017. As were hear a gradual path anticipated but what about the expectation that donald trump will rev up the u. S. Economy and cause more hikes next year . Fed official saced so far they cannot base policy on what might happen, they can only base it on what they see new. Theres a surge of optimism on Donald Trumps election. The National Federation of independent business, plans to hire, thats the white line. The blue line is expectationers in economy to improve. You see some improvement in their hiring plans, but boy, oh, boy, a 19point jump on their expectationers in economy will be improved in 2017. I just want to add one more thing here really quickly. Donald trump, he could be watching the fed chair with her remarks possibly. If you want to see what he has to say about the fed on the bloomberg, its tweets from trump, go there and youll see what he has to say. Will he approve of more rate hikes or not . Well find out about that and more hours from now. Thank you so much, kathleen hayes, ahead of the fed decision. We saw former fed chair Alan Greenspan, you can hear from him later on Bloomberg Television and watch for our interview with ormer e. C. B. Leader as well. Well have special coverage on wednesday, thats of course in new york, beginning at 1 00 p. M. New york, 2 00 a. M. In hong kong. Still ahead, jo pans corporate sentiment rises for the first time is six quarters. Well talk about Capital Economics later in the show. Plus rks an agency saying Global Oil Markets will swing to a deficit in the first half of 2017 but only if opec follows through with production cuts. More with t. D. Ameritrade next. Its 9 14 in singapore, theyre 14 minutes into trading there. Lets look at how other markets in the region are tracking ahead of the fed decision. Australia up about. 7 , led by real estate and utilities and the nikkei holding on to gains from tuesday, even the japanese core improved for the first time in six quarters. The cost pee slightly down there. The kospi down slightly. Production in november advancing 3. 4 from the previous month to the highest since july. However, there was still not enough to overcome the industrys longer term slump. They were 9 lower than in the same time last year. Chinas stateowned oil company may consider an i. P. O. Of its retail business, that could raise as much as 10 billion. Were told they have asked them to submit proposals this month for potential listing next year. They agreed to sell a 30 stake in 2014 for more than 15 billion. They have yet to comment on any future listings. Jonathan gray Jonathan Gray telling Bloomberg Television u. S. Economic growth is likely to be higher under a Trump Presidency and that may justify high property values. Apartments and hotels are most attractive to chinese buyers and he thinks the stake in Hilton Worldwide will look pretty smart. Rate hike seems all but assured tomorrow but investors will be looking to the feds tone and language to gauge the future direction of rates under president trump. They think it could support two rate hikes in 2017. Chris joins us from asia. Weve moved on now, already looking to 2017 and the narrative of how many rates are we going to get, what will be the state of the u. S. Economy . Sure. Thanks for having me on again. Look, i think youve heard a number of different guests, its a foregone conclusion at this point that we raise rates tonight here in the u. S. Th almost 100 assurity, you look out, theyre already talking about a rate hike for march or potentially june. But i think a key thing is, the fed is probably not going to change their dot plot for going into 2018. What we would anticipate is for there to be two more rate hikes in 2017. Followed by the rate hike here tonight, which would keep the fed in line with their 2 inflation goal. I just, the big thing that is kind of the wild card thats still out there, is trump. Trumponomics. Like is he able to kind of stoke inflation to a point where the fed is forced to raise rates at a faster pace in order to strengthen the u. S. Dollar . A lot of unknowns at this point. I anticipate, for two more rate hikes in 2017, just looking at what data we have in front of us right now. Chris, talking about the trump factor, were seeing of course that rally on wall street, the dow, closing in on that 20,000 mark an banks a big part of that story. But taking a look at whats going on with the kind of exposure that Money Managers are obtaining here, is it too far, too fast . What kind of assessment are you seeing . I understand your clients are liking the space. Absolutely two. Of the key areas of focus are banking and energy. Banking, weve seen our Customer Base across the u. S. And across asia actively trading across numerous banking stocks. Now recently, weve seen a little bit of net selling across some of the larger banks like citigroup, wells fargo, bank of america. But weve got to look at this as profit taking. When we go into the fed here later tonight, you know, a big key well be looking at, tone, language that were getting from the fed, the kind of potentially stimulate another leg up across the banking sector. With the comments, of course that donald trump has made in the past, certainly not seing the love for tech, have we . Weve got a tech conference going on in new york where hell be present. Do you think he can assuage fears here and is it perhaps time now to reverse the thinking and maybe become con trarne on that . On tech . I think weve gone a little too negative on some of the tech stocks based on antiglobalization rhetoric from trump. Whether its taxes or tariffs or different things, i mean, its not that were going to become Less Technology driven throughout the next year. So maybe a little bit con trarne in terms of some of the larger stocks weve seen, intels and facebooks, we have seen our customers actively trading. Since trump was elected on the eighth of november, weve seen a little bit of a maybe overcorrection on those stocks. So i would anticipate a little bit more normalization on those stocks kind of coming over the next few weeks. Chris, is the party over for Consumer Staples . Yeah, look, again, we have a lot of this rhetoric, trump is now a team that hes putting together, is this antiglobalization. Sit definitely taxes, we have some of these Large Companies in the united states, like the walmarts of the world, or cocacola, a lot of their production and things that they sell are made outside of the united states. So if hes trying to raise taxes, you know, on these particular things, its only going to do one of two things. Its going to lower the companys earnings, or these companies will have to raise their prices. So a lot of, kind of clarity that were looking for going forward, right now we feel our Customer Base shying away a little bit from the Consumer Staples sector and its been net sellers across the sector here recently. For those who dont want to play specifically into the banking or finance banking or energy stock well, do see some heavily traded e. T. F. s in x. L. E. And x. L. F. To get exposure across those sectors without picking individual stocks. If we dont talk to you before then have a merry christmas. Up next, japan another step closer to billions of investments. Well be live in tokyo next, this is bloomberg. What is it youd like to have as your legacy . Id like to be the oldest man that ever lived, actually. Casinos a step close for the japan, this after an Upper House Committee approved new legislation. And the bill is now expected to pass a final debate in parliament on wednesday, opening the door to potentially billions of dollars of investment. Lets bring in our tokyo bureau chief. Whats happening . So the upper house today will meet in the main session and the bill is expected to pass sometime today. There is a slight possibility the Opposition Democratic Party may submit motions to sort of delay it but its basically going to be a matter of time before it passes. And because the bill was slightly revised from the initial one, it will have to go back to the lower house, the main session, there, but again this is all going to be sort of very, very ceremonial and basically, it is a pretty much done deal that casinos will be legalized here in japan for the first time. Right, where, though . Where will they build the casino, and what are the next moves . Im probably getting ahead ahead of myself there, so whats next . What this bill does is legalizes casinos in japan. The, i think the key are going to be in the details. And that will all be discussed in a second bill that the government will have to draft up. This will basically determine some of the key details that companies will be interested in, such as how the license will be awarded, where the sake noahs will be allowed, whether japanese nationals would have a normal access to it or they would have to pay a fee as in singapore, for example. All that will need to be discussed and debated in parliament when the next bill is drafted. So basically, any sort of casino that well see in japan will not happen before the 2020 tokyo olympics. Itll be just a few more years before we tail see and at this point before we actually see and at this point its hard to see exactly how casinos will be operating in japan. Thanks so much to our tokyo bureau chief for the latest on legalizing casinos in japan. This is what the session looks like in tokyo and seoul and there in sydney. A word on the free market auction which came to an end a short while ago here in hong kong and we have the hang seng up, 2 3s of 1 . 150 point move to the upside. And how will donnell trumps policies affect regulation in the Banking Industry . Well hear from hsbc chairman next. This is Bloomberg Markets asia. Over in shanghai, weve got this feeling that the bulls are out and we can have a look at this. Its time for reflection on the rebound we have been seing this year going into 2017, taking a look at the terminal chart weve got up there and you can see despite the types of hiccups we got from japan announcing negative rates back in the first part of the year, the brexit vote in june, followed by trumps win in november thats just to sa