, but this isnes not working right now. Thee can see perhaps on bigger map here, we can see whats going on with the nikkei two to five, japanese shares down. 8 , family mart showing what is happening with the retail space as retailers struggle with softening consumer demand. Some poor results posted overnight, and later this afternoon, fast retailing and others. Thehe region, gains on kospi, the shanghai composite higher. , shares other red spot and wellington down 10 , materials lifting the story on the asx 200. The big theme is what is happening with that dollar drop, lower for a second day. As we started off, that yen strengthening. Well, our top story, thank you very much indeed for that, sophie. Being questioned as part of this bribery investigation in golfing the country. It has already brought down the president there. The tentacles reaching further and further. Lee has been question before, but this is the first time brought in by the special Prosecutors Office. This raises the possibility he could be arrested. When he arrived this morning, he apologized to koreans, saying basically, apologizing for not being able to show better behavior in this case. He is the vicechairman and that de facto head of Samsung Group. We are expecting he will stay at the special Prosecutors Office until friday morning. Is part of rishaad staying at the Prosecutors Office . Of thatis all part bribery investigation looking into whether samsung and other conglomerates made payments to owned by a close friend of President Park geunhye. Case, did samsung provide support to this friend of the president . Have helped with the merger that went ahead and made it easier for lee to increase influence over the company. An activist shareholder was against the move and said it would cement the founding families control at the expense of shareholders. Investigators asked parliament to file a complaint against lee for perjury during the parliamentary testimony. He and eight other table heads were grilled by lawmakers last month. Was presentedt pc to reporters, and prosecutors believe that one email from it indicates that funds were given from samsung. Looked ok, of course he like he was a shoe in, didnt he . It, impactor does the secession there, the head of Samsung Group . Son ofd he is the only the current chairman of Samsung Group, an ailing man who has not been well for the last couple of years. Lee has been groomed for this job. Forung has been planning him to take over as chairman for some years now. This throws this all out the window, especially if he is. Rrested the what options are there . They could install one of his , put a caretaker in from outside the family, but the family could still control the boardroom behind the scenes. If it is unclear what will happen to him after this questioning. Rishaad right, thank you very much indeed for that. Right, lets get you to the , and congressuse anyway, and of course it is time to get these appointees appointed. Lets get more first word news from sydney from haidi lun. Haidi secretary of state nominee Rex Tillerson faced questions, including russian hacking, tensions and asia, and the need for global u. S. Leadership. He said moscow was a danger to america but refused to call president putin a war criminal for actions in syria. He also said beijing cannot use disputed islands in the South China Sea, and that the world once a strong United States. In thechieve stability 21st century, American Leadership must not only be renewed, it must be asserted. We have many advantages on which to build, our alliances are durable, and our allies are looking for a return of our leadership. Volkswagen has taken that step towards resolving the emissions scandal, pleading guilty in the u. S. And agreeing to pay a 4. 3 billion fine. Prosecutors announced charges against five executives in germany. Using falseto statements and at structuring inquiries when authorities grew suspicious of emissions levels. To be clear, volkswagen new of these problems, and when regulators express concerns, volkswagen obfuscated, denied, and ultimately lied. Indias central bank has refused to offer specific details of the ban on high denomination bills as questions are asked about who took the controversial decision. Hoursws came out three before it was announced live Prime Minister modi, however, the bank declined to offer more information for National Security reasons. Global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. This is bloomberg. Rishaad thanks. Donald trump confronting two of biggest political challenges. He says he wont divest from his company, but also answered unsubstantial claims that russia has information about him. Something like that should never have been written. It should never have been had. It should certainly never have been released. Beenad Ramy Inocencio has following this what was the biggest take away . Ramy the things that raised eyebrows was donald trump finally admitted that russia could indeed be behind the hacking of the Democratic Party committees emails as well as the intent to her Democrat Hillary Clinton during the u. S. Election. That was the only thing donald trump conceded. He decided to go on the offense with one of his favorite targets, people like you and me, people in the news industry, and he did this through his favorite medium, and that would be through twitter. So lets check out his quote on that. ,asically he was saying that lambasting the fake news out aree and saying there crooked opponents trying to belittle his victory. He also lambasted the intelligence agencies here, claiming they leaked this socalled fake news. He said they took one last shot at him before he becomes president in nine days pretty also posted a question, are we living in nazi germany . Out with guns blazing, some of his targets, pushing back against the idea that he had anything to do with these rumors, unsubstantiated reports, the deal with russia. As for conflicts of interest, a lot of criticism he has come into, people saying what he has done is effectively meaningless because he could have done more to distance himself. He has about 500 companies and more than 20 countries, totaling Something Like 3. 6 andion or so, so he said, this is true, that he does not have to do anything, but because he should do something that he has going to do it. Take a listen. I could actually run my business and run government at the same time. I dont like the way that looks, but i would be able to do that if i wanted to. You cant do that in any other capacity, but as a president , i could run the Trump Organization, great, great company, and i could run the company. I would do a very good job. Need he said he does not to do anything, but is going to do something to it what are those exactly . Step down he will from all positions at Trump Organization. He says the business will be placed in a trust, and the trust managed by his sons. He also says most importantly that he will not divest ownership in the organization. This has a lot of people saying this is probably the worst thing that he is not going to be doing. Theattorney said selling company would exacerbate conflicts of interest for a number of reasons. His hotel will donate profits from foreign governments to the u. S. Treasury, donating, which is quite interesting. He said he wont be informed of any deals the Trump Organization does overseas, and if it does anything domestically, it will go through a rigorous vetting process of which he will not be part of. Rishaad thank you very much indeed for that. That is Ramy Inocencio there for us in new york and looking ahead, the growing trade spat between china and the United States, how beijing is going against the grain. Next, assessing the outlook for resources with Conference Bank commerzbank head of global research. You are back with Bloomberg Markets as we look at the business flash headlines. A consortium to bid for the warehouse operations of Global Logistic properties, speaking with banks and partners about an offer for this company. It has a market value of more than 8 billion. P will have offers by early next month. Japans top retailers, earnings falling. Both of these for the Third Quarter, stagnant wages prompting people to not spend much money. On japans Retail Sector later, fast retailing and others reporting after the close. Southeast asias most viable startup is said to have picked Goldman Sachs to lead its ipo. It is said to be looking to raise 1 billion and is considering a listing in the u. S. If the offer goes through, it would be the largest tech ipo out of southeast asia. Right, a quick check of commodities, gold, brent, copper. There we go. A snapshot of what is happening. Gold on the way up. Getting up to the 1200 level there. Our next guest says the road for commodities will be a bumpy one. He is normally based in frankfurt, but with us now. , ice we talked last time cant see how many twists and turns have occurred for the metals complex. It is probably one of the most difficult Asset Classes to get a grip on. All the commodities in fact, but last year, it was a good one from the Forecasters Point of view because most of the moves were more or less logical. Last year, one year ago, the oil price was trading below 30, and our forecast of 50 plus rishaad a lot of people were thinking 20 and sub 20. Definitely it was logical. The price moves were logical because oil wasnt performing anymore as a political instrument. It was trading on demand and supply another things that no normally analysts can grip on. This year will be bumpy and difficult to forecast. Rishaad you did not take zinc last year . We did. Especially what happened after the trump election was surprising to us, and we think it was too much optimism already priced in. We think it makes sense to take a step back and wait for the prices to come back, too much optimism priced in right now. Rishaad why did we get this herd mentality after the Third Quarter . It was all about the reflation trade essentially. At the moment, you see this lation hiking up the cost of metals and for structure linked, but the rest of the sector is getting encouraged. I think we need to put it into perspective. China is making up over 50 of world demand in copper, so any slowdown would have much larger impact on copper or Industrial Metals than any pick up in activity in the u. S. This will take months for this activity to pick up. Thats why it makes sense to be contrarian on metals, oil, and growth as well. Oil, investors are overly optimistic. On gold, they are pricing in too much pessimism right now. I see headwinds, but also potential for higher prices. Rishaad but what about Dollar Strength . Persists and the Dollar Strengthens further from here, you control throw away your predictions and start again . Because we are saying it is already priced in. I looking at the perception of the market and how much is priced in already, and right now, there are three hikes priced in, everybody expects the euro to fall below parity this year. Soect equity markets all this is priced in and this is why the gold prices not belowg at 1300 plus, but 1200. During this year, we will have to scrap many expectations and probably if trump under delivers, we are likely to go higher than 1300 for gold. It was price for perfection almost, wasnt it . Lets talk about oil. The lubricant of the global economy. Huge move really taking place, especially when they have that deal together cutting output. Now the thing is that people will cheat, on top of that, capped fore we are shale producers. Where do you go with it . I think we are going down. There are many reasons. First, opec will yet again overpromise and under deliver. We will get cheating from opec. We will get false information from opec. To get thet going cuts promised by the likes of russia and kazakhstan, which are likely to high production this year, contrary to what they promise to opec. Above 50, u. S. Oil production will kick in, so i am looking for production to barrels above 9 million , which is already high production for u. S. Production, so share will recover while opec will not cut by as much as lots of, so there is potential and a lot of room for disappointment this year, and when you are looking at the positioning and the perception of the market, it is overly optimistic. Wti, brent, if you add up the net long positions, it is never as high as it is now. There is room for disappointment because it is a herd mentality. Rishaad five seconds, where is oil, brent, wti going to be in six months . 45 would be my guess. Rishaad thank you very much indeed. Commerzbank visiting us in hong kong. Could be the yuan next big shock to come out of china. We are looking at that and finding out why. That is on the way. Mostad the worlds tightly manage currency, but yuan investors think we will see an Exchange Rate solely determined by market forces. ,e look at the reasons, and ok present the case for the freefloating of the yuan. It might sound crazy, but there is a case for it. China has been fighting gravity and had to deplete reserves and keep conditions tighter than they would to defend the Exchange Rate, which is not a great idea when you have a slowing economy. The freefloating will not be that bad, china has massive foreign reserves, a large trade surplus, and inflation is low, so why dont you just let it go . Rishaad of course, but is there anyone seriously contemplating that could happen . Surveys of strategists, positioning in the options market, it is not the base case right now. After all, we know china tends to take things stepbystep. It is a bit of a crazy idea and that it is highly risky and you do not know what will happen. You could get a kneejerk tumble exacerbating outflows and causing panic and if the reaction to the august 20 15 devaluation is any indication, this will shock global markets. . Ishaad right, for the defense what is the other alternative . Just continue muddling through as we have seen done in the past. What china has been doing is that it has prioritized stability in the Exchange Rate and continued intervention and tighten capital controls, so that is the market base case right now to see china continue doing that. Rishaad thank you so much for that. We shall see, free float this year . People are quite dubious of that. Anyway, that is what we have at the moment in terms of the yuan and whether it floats or not this year. We are turning down at the moment, this is what we have come a hang seng off. 1 , a little bit of a lower move there at the moment. Taipei,at seoul, korea, the other direction, a mixed bag essentially here. There we go. That psychologically important 3000 level there. Coming up, Donald Trumps pick for secretary of state takes a tough line on beijings ambitions in the South China Sea. We will look at what he has to say. This is bloomberg. With the xfinity tv app, anything with a screen is a tv. Stream 130 live channels, plus 40,000 on demand tv shows and movies, all on the go. You can even download from your x1 dvr and watch it offline. Only xfinity gives you more to stream to any screen. Download the xfinity tv app today. Ive spent my life planting a sizesix, nonslip shoe into that door. On this side, i want my customers to relax and enjoy themselves. But these days its phones before forks. They want wifi out here. But behind that door, i need a private connection for my business. Wifi pro from comcast business. Public wifi for your customers. Private wifi for your business. Strong and secure. Good for a door. And a network. Comcast business. Built for security. Built for business. 1029 a. M. In hong kong. Im haidi lun with first word headlines. Questioned by prosecutors investigating koreas undue influence can look has taken down the president. He was expected to be summoned, but has been named a suspect. Prosecutors want to know whether samsung and other Companies Make payments to a confident of park geunhye in exchange for political favors. Surging, volume doubling. The shipper is asias bestperforming stock this year, 270 . Some bloomberg data showing strong foreign interest with overseas investors snapping up 217 million in shares. Hsbc will pay 45 million to settle a pricefixing case in the u. S. In accord results the bank the case. The case was heard in the u. S. District court in manhattan. Month, hsbc, j. P. Morgan chase, and one other bank were find in the eu for rating. Aviation is about to mark the end of an era with the iconic jumbo jet planning to make his last fight in the u. S. Utilized it 747 a final time, retiring the plane ahead of schedule. Many carriers have relied on the jumbo since his debut in the 1970s, but demand has slumped. It is ready to end production. Global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. This is bloomberg. Rishaad right, lets have a on. At what is going japan on his lunch break or lets get to sophie kamaruddin. Energy and materials stocks leading the gains, but health care down 1. 5 percent, the biggest drag in asia. We are seeing that play out in japanese stocks, down. 9 heading into that lunch break. One downhe likes of the drop among drug makers. This is trump saying the Industry Needs more competitive pricing. Japanese farmer players are exposed to the u. S. It is japans biggest drugmaker. Retailers feeling the pinch and japan. Elsewhere, the kospi up. 25 , the week won, investors looking past the scandal. Hong kong down, but holdi