Just a little ways from the open here in hong kong and shanghai. A bit of positivity for singapore. Whats the mood like . Have one market that is already closed, new zealand. Volumes are quite thin. Theres not a lot of appetite to take big bets ahead of the new year. Have a look at new zealand. Extremes,ot of especially across assets, if you will, in the past several weeks. We scaled back from those extremes when you look at gold, which fell to a 10 month low. It has recovered quite a bit. In australia, gold miners are on the way out. Its close for the day. It is clocked in. Its fifth straight annual gains. That market is quiet and we dont talk about it a lot because it is quite small. A nice rally the past 15 years. 11 of the past 15 years, we have seen markets here at five straight into this year. Australia has a short trading session p. M. Korea is already closed for the year. South korea just managing to buck the trend. Overall in east asia, the second year of gains in south korea. The nikkei 225,. 7 . Topics that the the topix is clocking in its first loss since abenomics. Have a look at taiwan. We are up 10 for that market. , retracing some of these extremes. To 47. Year yields back 2. 47. Japan is well anchored at these asset levels. Let me end with a look at oil, which is continuing to hit extremes. Course, thatof opec a nonopec producers deliver as promised. 53. 54 for all intents and purposes. Story. The other market verylizing after that eventful trading day. We do know its not driven by any sort of specific news. Watch out 2017. Algos, man versus machine. Donald trump saying it is time for the United States to move on after president obama punished russia for its hacking and the in the president ial election. Moscow responding that it will respond in kind. Russian sanctions, no he released fbi evidence. Those are main actions that president barack obama mentioned. Obama saident, mr. All americans should be alarmed by russias actions. The data theft and disclosure activities could only have been directed by the highest levels of the russian government. Chris pratt, russia has chris for its part, russia has denied any involvement. Experts have linked to the gr you to the hacking of the Democratic National committee. The have also linked Successor Agency to the kgb. Operatives working under diplomatic cover to compounds in new york and maryland will be shot. Department of Homeland Security also released a report with evidence intended to prove that russia was in fact behind the hacking. In the meantime, congressional leaders reacted quickly with Chuck Schumer tweeting we need to punch back and punch back hard. Paul ryan praise to the president upon his actions and senator john mccain said the andres are long overdue at stronger sanctions are still needed. Four hours after president obama announced sanctions, president elect donald trump released his own statement. He said its time for our country to move on to bigger and Better Things. Nevertheless, in the interest of our country and his great people, i will meet with leaders of the Intelligence Community next week to be updated on the facts of the situation. A kremlin spokesman did note that mr. Trump will be president in just three weeks. But a white house official says he could reverse president obamas executive action, but he may not want to let russian spies to come back to the note states. To the United States. Rishaad first word news headlines. Data recorders on the airplane that crashed into the black sea have no evidence of an explosion. It crashed soon after leaving sochi on sunday. 92 people were killed. China is pledging more proactive fiscal policy to tackle local government risk and to defuse risk. The ministry is saying that china must assess its difficulties and protect itself from domestic and international hazards. The bank of japan governor has admitted japan is in no condition to say it has escaped to deflation or that it can reach 2 inflation. Canda said policymakers relax some unknowing that the surge has been corrected. The European Commission approved moneyme request to borrow. Our opinion nomura has cut hundreds of jobs in the last few monster. Japans biggest brokerage is not done yet. Announced a new plan to improve efficiency and bring costs down. How much more can he take the knife to hear . To here . Is about cutting waste and improving productivity throughout the organization. Previous costcutting rounds were focused on job cuts. This time, he is looking at costeffectiveness of everything the people do. The project waterline can it is like a big ship that has its called the project waterline. It is like a big ship that has excess baggage. What they do every day at the office. They will be looking at administers, tasks, meetings, emails, all the source of things that could get in the way of productivity, starting right at the top with executives and how much work they create for their subordinates. Once the review is done, the company has to estimate how much money they can save from this initiative. How does this differ from their previous costcutting efforts . Russell the Lehman Brothers board inherited some hefty personnel costs. This is quite different. This is more about efficiency throughout the organization. Most recently, they cut 900 thele in europe and americans to save 700 million this fiscal year. A look says this this is starting it looks as if this is helping to become more profitable. To be profitable outside of japan for the first time in two years. Cuts, now theyst are eking out savings from everyday tasks that employees do on the job. Rishaad thank you very much. Still ahead, super mario is said. O hop onto Android Devices i minutes of trading, eking out a small gain. Nikkei on the way down. Itsext guest says that time to take profit now that the trump rally is phasing out. The reflation has been driving the market thus far, so i the prospect of it. Thisre suggesting that market is fizzling out. Can say that the Economic Activities are improving. The u. S. Economy is operating at full capacity. And inflation is increasing across the board. And inflation is going to be a big thing for 2017. Does this also mean that the centrality, the importance of Central Banks in politics and economics in countries will receive as a result of this . We are moving from monetary to more fiscal orientated reform. I think him a the past six years, we have lived in a steady and slow and predictable growth. Whenever growth falters, banks would come in and backstop any risks. Monetary policy is losing its effectiveness. With trump, we can see the fiscal policy and the regular real tory changes will be taking center stage. That will be a big change for 2017. A little bit more uncertainty. Policy is this unstable pendulum that could be potentially good. It could be potentially bad. If he goes with the regulars in, that will be good for markets. But antiimmigration would be bad for markets. Will be affected by economic outcomes. It his higher uncertainty for investment returns. Rishaad does the bond market comeback . We see a little bit of bond yields backing down slightly. Generally, our call has been a bigion is one to be theme for 2017. We have been urging investors to reduce bond duration. At the same time, we urge investors to gain instant exposures to inflation rate bonds. Do you think that theres going to be more uncertainty looking ahead as well . What does that mean for returns . In terms of returns, you can expect a wider range of returns. In the emerging bond market, i think you can expect lower returns. 2016 has been a very good year for emerging market bonds. Highyield bonds returned more than 15 of our. For 2017, it is unrealistic to expect such total returns. Its likely to be a coupon clipping year. Are selective opportunities in the emerging market bond space, particularly some of the regions in central europe, eastern europe, even africa. I think those regions look exciting to us. Be moreographies will shield from trump policies. Theaad does it result in donald strength the Dollar Strength continuing . I think the Dollar Strength looks to be fizzling out against the major currencies like the euro and the japanese yen. The Dollar Strength can continue , especially emerging market asian currencies. Cost anti goes on his i think the dollar can continue to strengthen against rging markets and agent and asian currencies and 2017. Rishaad you highlighted some stocks you like. Would you like to go through some of them . I think 2017 will be a year in which you dont chase the broad market rally. You have to be more specific in your investments, bits specific sectors and specific stocks and physical trust. In that respect, we like u. S. Banks because they will beth and that benefit from a steepening of the you got. Particularly, we like the regional banks in the United States. We also like the u. S. Welker sector because donald trump will reforms. Ggressive on u. S. Health care looks exciting for next year. At the same time, we also like u. S. Discretionary, consumer spending. That sector will do well if the tax cuts come in and if the wages continue to hold up. I think these are the very exciting sectors for next year. Rishaad have a good one. It dropped as much as a quarter one person, widening its discount to the onshore rate in over two weeks. Southeast asias bestperforming stock is expecting a running here in the new year. Shares are more than triple this year. You see the stock increasing. It is the highest price since may 2012. Also benefiting from the election of donald trump. Death by overworked is looking for ways to give employees a break. The campaign is scheduled to start in february. Typically use just half of their annual paid leave. Coming up, the clock is ticking on indias rupee. We will assess the impact of rural next. Lenders have risen to dangerous levels. Total nonperforming loans are expected to rise even further by the end of this fiscal year. Weakness in the indian Banking System would deal a blow to raisera modis attempt to credit loans from a near twodecade low. Lets talk about indians having to deposit the official window closes today. Its been chaotic since this came in. This is the last day. 50 days was given for people to deposit their old notes, one thousands, 500s and swap them for new years for new ones. People jostling at banks, trying to change the money. Mrs. In a country where catches getting this is in a country where cash is king. Transactions go noted because it is all cash. Talking about illegal activities , corruption, for example. The black economy is often said to be bigger than the real economy in india. Courted cash back into the system then that will give the economy a boost. In the longterm, Digital Payments will help to ensure compliance and cleaning up the economy. There is a big move to transfer people away from cash because it is easier to keep track of things when they are electronically accounted for. However, it has attracted a lot of criticism. Currency availability will improve in the coming weeks. Rishaad he was surprised by how orderly things were generally speaking when it came to exchanging this money. The thing is, a lot of people are not happy about it, but not blaming modi particularly. Things havent been to bed. There are people who are supporting him. People in the queue saying they targeting unaccounted wealth, but see what people really have to say about the big selections when the come along. That would be considered a referendum in a way on the danone at his asian policy. This already seen how drive has ashley impacted the economy. They forecast for october, november, december had to be revised down. We are hearing stories about farmers who cant sell. These effects have been taking place. Modi is expected to talk about incoming plans. Rishaad thank you. Record 392 gains. Rishaad lets have a look at the first word headlines. Move saying it is time to on to bigger and Better Things after the u. S. Punished rush for hacking the u. S. President ial election. The president elect says he will meet with intelligence officials next week during russia rejects the accusation and says it has no choice but to respond in kind. North Korean Leader kim jongun is said to have executed 140 official since he came to power in 2011. He says he ordered their deaths for disagreeing with him or failing to implement his policies. The total number of those executed is put at 340. Oil is heading for its first annual gain in three years. Crude also seeing its biggest for your rise since 2009. Thats despite your stockpiles being at their highest levels. Japanese Prime Minister shinzo abe public approval raising since is visit the pearl harbor. It a 4 of respondents agreed with the decision to visit pearl 94 of respondents agreed with the decision to visit pearl harbor. Weve got the Hong Kong Open upon us. David when you look at these markets, you look back and its really been quite a year. Hong kong 2015 and 2016, we are looking at a second straight loss. If we do rally about 100 points, we managed to get our heads above water. For 4 10 of 1 for shanghai. Oil hitting and you 2016 high. 12 months year to date, where are we . Shanghai deposit down 13 for the year. Hence saying index, here we go the hang seng index, here we go. Maybe about a hundred, 120 points. It does manage to get above water. Also watching a lot of these casino players. Mgm one of the better performers in the space. Its been quite a year. January 1, thats what the new data comes out of macau on the gaming intake. We are expecting roughly a 9 increase year on year. Another group of socks we are watching, ipos in china trading. We have to on the mainland. One in hong kong. Which onesf obvious are those listed on the chinese mainland and which one is a really is having a really good session here in hong kong. Weve been checking these guys a reasonable day. My dont even know what these companies theres not anything against the companies. Thats exactly what we seen every single day. 2016 was another ipo extravaganza in china. Sherry has details on how much we are talking about here. The surges we have our mind line. Yes. the best return weve seen since 1994. You can see that the only comparable year was last year, 290 gain in the first month. No ipos in 2013. Trying to impose a moratorium. Iposan see the number of in green. More than 200 Companies Going public this year since 2011. Rishaad wise demand so high or priced ridiculously low . Its a little bit of both. A weak market, the shanghai composite dropping 13 this year. Shares are very tractive. But as you said, they are rice very low because we have seen guidance withtory the evaluation limits 23 times earnings. So they have to list their shoulders their shares at levels below their peers. Rishaad people must be turned to buy their arm off over one of the stocks. Shery like winning a lottery. The odds are one and 2500. So we have these new regulations one in 2500. So we have these new regulations. To 0. 04 percent. Thank you for a much. Lets take a look at what is going on in the world. The automotive world. The wesley the worlds leading carmakers are in a battle to find buyers and talent. Manufacturers, especially japanese ones, are finding a hard to attract i. T. Experts. Of thigngs are they doing to deal with this . 2016 was a race to hire i. T. Talent because of the race to autonomous cars. There is a war in hiring i. T. Talents. Announced it will tech talent. Offer a moreg to for theiralary system ai. Rishaad the thing is, either things get better get worse before they get better. Are they searching for the right people for the job . Thecomposition competition for hiring i. T. Individuals is already hard. It is probably going to get tougher Going Forward. The Auto Industry want i. T. Talent. Almost every industry moving into iot want the same type of skill sets. We are really in the age for connectivity and for ai. Japanese auto makers want to lead the automotive industry, they have to find a way to cope in japan. Alreadyy leads in a shortage of i. T. Talent. Echoad thats the speaker. A lucrativeeres market for it. Betting big on the success of virtual assistants that response with commands. It started with amazons surprise hit, the echo. Championshipsmany has dan renault wondering . Zero championships. Well played, murray know. Amazon sold more than 3 million devices. And it was cheap, selling for 180 a pop. But the real payoff was in amazons core ecommerce business. They think it is one of the faster growing businesses for amazon. It adds into the ecosystem that amazon has, where they already have a lot of traffic coming to their website and but this is a chance for amazon to grab the traffic, which is not online. Owners are spending 10 more time on amazon. Com after buying the smart speaker. And amazon stock popped more than 70 since the echo came out in the u. S. So as no surprise google wanted in on the action. Credit to the team at amazon for creating a lot of excitement in the space. About our thinking own approach. That was google home. With theth elephant in the room. Tois use has been limited the iphone. Owners of smartphone use it on a weekly basis. Apple would be insane not to get out there with a similar product. Back in september, bloomberg reported that apple is pushing ahead with an a costyle competitor. With an echostyle competitor. Rishaad december is shaping up month. Intendos worst that is despite to the release of super mario run, the smartphone game that was supposed to jumpstart growth. Super mario won in many super mario 1 was a gamble. They priced it in a an interesting way. It is not a premium game. Nintendo almost treated this like a conslole game. Unlock all th0 to e levels of the game. Price. E balking at the it looks like you can finish the game relatively quickly, in about an hour or so. People are not responding well. It was a risk. Best gamble nintendo could have taken. But we will have to see. Super mario brother is a beloved game for the maker. And hes got longevity. Things will pick up and we will see how things go. Rishaad even so, why would this and why would this disappoint investors ultimately . Back over the summer, we had go. Mon meant to do was avoid involved in that, but it was, as we know, a breakaway hit. That really did raise expectations for super mario run. Espe