Agrees to buy a company for 5. 5 billion. Right, half an hour from the start of the trading week. No trading in the u. S. , Martin Luther king jr. Day. In japan, machinery orders better than expected, the ppi,cer price index, factory gate inflation better than predicted by economists, but still in negative terrain for december. But see how the markets are tracking. David. David thanks. We are looking at a mixed bag. Markets just opening up, taiwan, malaysia. Have a look at singapore. One of the better performers performingthe best market in asia save for the philippines. Mixed. Ight times index,verything else canceling out japan pulling things down, australia, flipped the board, some other benchmarks at the moment. Australia, that comes down to the fact you are getting a decent bid when it comes to the mining stocks, japan, strong japanese yen weighing on that index. Assets. Ook across 1. 20, roughly at those levels. Dollaryen, still close to session lows, 114. At 2. 4 yields unchanged percent, higher from friday, Regional Sales playing into that. West texas, not a lot of action. Said, when you look at the commodities space, china so far the past week or so. Ore, thatbber, iron is in renminbi. You get roughly 85 when you do the math, a hedge their against expected appreciation in the chinese renminbi, but Barclays Says that is a blip. Let me wrap things up with a its bestet to extend start to the year since 1983, floods and thailand disrupting the outlook for supplies, could cut supplies by 20 this month. This is shanghai. We are looking at a 9 pop for this quarter, so the fundamental story, but also a party a cross commodity exchanges on the china mainland. Rishaad thank you for that. Lets get you up to speed with some first word News Headlines. Here is sophie kamaruddin. Donald china has urged trump to recognize this and sensitivity with regards to taiwan and says its one china policy is not negotiable. Donald trump told the wall street journal he would only commit after assessing beijing on trade and pricing issues. The president elect said he is not prepared to declare china currency and if you laters immediately upon being sworn in. Delaying a decision on seeking an arrest warrant jay y. Lee, investigators question him for 22 hours as a suspect in a bribery investigation. Prosecutors say they will make the decision by early monday afternoon. The heads of south korean conglomerates having question whether they were pressured to give money to foundations controlled by choi soonsil. The press trust of india reported the finance ministry is likely to finalize a Capital Infusion plan for statefunded vendors this week. The government could offer more than 3. 5 billion dollars in assistance, which would be announced on february 1. Luxottica and essilor have agreed to a merger. Closedin the companies higher, 1. 4 on friday. Global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. This is bloomberg. Rishaad well, li kashing agreed to buy duet group and a 5. 5 billion deal, agreeing to that takeover. It raised the original offer it made in december. Lets get to pay her a williams, how is this deal structured and what about shareholders, are they going to give the thumbs up . Hi. It is an interesting deal. It looks like shareholders are likely to approve it. Ofre have been a couple analysts saying it is likely to get over the line. In terms of the structure, li split betweenly three of his Different Companies , which will require separate he has said that can move around a little bit depending on how those votes go, but it appears to be on firm footing at this stage. Rishaad right, well, the point is that there have been many , do you expect a li kashing to encounter Foreign Investment issues with this move . Yeah, of course. Li kashing did get knocked back last year when he bid for oz groups owned by the new south chinagovernment, as did regarding National Security concerns. This time around, the assets are mostly electricity and gas distribution, a gas pipeline in western australia, not seen as sensitive, so it seems to be that Foreign Investment approval is pretty likely. Of course there are some other Regulatory Approvals from the hccc, but not seen as a big hurdle. Rishaad right, is anybody else interested here . , it is interesting, the final assets being sold by the ,ew south wales government expressions of interest have come up today for that, so you would expect some of the potential counter bidders for may already be locked into this. Are regulations on the sidelines, but we have not heard anything yet. Thank you very much indeed. Perry williams from sydney. Holding out hopes the tpp will come together, even though donald trump has vowed to withdraw from it. The trade deal would be a major boost to the vietnamese economy. The message that i see is that i believe the new administration of the United States will reconsider as perspective on the tpp, and it will also try to achieve a new generation agreement that will benefit all parties concerned. I see the newly appointed members of the are, many of them, in favor of the tpp, so i think they might reconsider their decision. Hour our correspondent spoke exclusively. Why the optimism . Haslinda the comments from team, those taking senior positions, suggesting tpp as not dead. Rex tillerson, he said recently, he isnt opposed to tpp even though he shares some of trumps concerns, and that view goes beyond tillerson. Over the weekend, we had commitments from the likes of , shinzo abe,ull also a strong advocate. Quashed, theets nons Prime Minister says he is not too concerned. Here is why. Even without the tpp, vietnam will continue to move forward, because of other agreements in , so i including the rcep think this will help propel our economy forward. Tpp is important, a way for vietnam and some Member States to push through reforms which it cant do in turn only given domestic infrastructure or structural constraints. Tell me something, vietnam has been in tangled with china over claims in the South China Sea. What about the white house, how is that perceived . Haslinda some development here. We had a statement from both countries over the weekend, china and vietnam. Stability ando the South China Sea and avoid any action that could escalate the tensions. Vietnams communist party chief weekend. China over the they agreed to seek longterm solutions and will discuss Transitional Solutions that will not affect each others position on the issue of the South China Sea. Both trying to avoid tensions that piqued in 2014 when china placed an oil rag in a dutch oil rig in a zone that was claimed placed an oil rig in a zone that was claimed by vietnam. Rishaad thank you for that. We will be hearing more from that interview throughout the day. J. P. Morgan chase on which indices will be affected by this evolving sinoamerican relationship. A hitng, the pound taking over reports that britain is seeking a hard eggxit. That is on the way. News, thiseaking influence scandal and corruption investigations and south korea. Has beenea inc. Navelgazing. We have the latest installment nt the pension chief indicted. Prosecutor special saying this in a text message. Markets, ourk to next guest saying diversification should be the top of investment lines this year. He is normally in toronto, but here in hong kong for us this morning. What is going on . Lets get your reaction to this massive move by sterling ahead of theresa may speech on tuesday. It has been mentioned that this could be a marketmoving lecture or speech, so is a christ in now . David sterling has certainly moved aggressively to the downside on the comments from the Prime Minister. As well as the hardening tone among german industrial companies. Ratchetseen both camps up the pressure on the potential for a clean break and a hard brexit, and you are seeing it in sterling as you mentioned. Rishaad from looking at it on the other side of the atlantic, canada, what is the mood like when people view it . Does it seem like an opportunity to reestablish ties with canada . David i think so. Freest concluded a large trade deal with the common european market, which may be one of the last major trade deals, so canada remains protrade. If the u. K. Goes in that direction, we would love to reestablish that trading relationship, although it may be more complicated with the nature of International Trade deals. What happened november with sterling, the of time referendum maybe not so much, but has it people running a bit scared . Has since the foundations of the wto in the 90s, nothing but the breakdown of trade barriers, and that has a lot of countries, countries like canada and asia and other parts of the world, running scared, as you say. Rishaad when you come here, you have been noticing how the fund flows have been into diversified asset strategies, is that the right way to go . David we think we have the right strategy to manage this higher volatility. Global fundamentals are coming back, Global Manufacturing at threeyear highs, a resurgent earnings recovery, but at the same time, significant political risks and risks to International Relations that may weigh on multiples and cause a rocker and rocky and higher volatility and markets going forward. Rishaad we just got the yuan fix, your reaction to that. Again, three Straight Days of strengthening the currency. Are they sending a message . David they want to ensure that there is a somewhat twoway flow. It is on the way to being a more currency potentially impacted by capital flows. They are probably looking to less of a hand in it they today, and obviously there is very much a sense that the renminbi is only going weaker, so i think it is interesting they would choose to strengthen it. , lets that the side concentrate on what you are doing at templeton at the moment in terms of responding to investors. What is the question you are asked the most . David what will policy evolution be like, in line with the rhetoric in the u. S. Rishaad you dont know day from today what will happen. David Something Like tpp may not be dead. It remains to be seen. Vietnam would be a big beneficiary of that deal. Is a lot ofhere uncertainty with this current administration. Canada is a massive proponent of this as well. It is against this backdrop of an improving global economy, even todays machine orders out of japan was not as bad in terms of month on month anyway, but that ppi was still negative year on year, but getting better, so will we see proper inflation in japan . David i think we will. The economy is tightening, running at full capacities, wages picking up. Machine orders were quite strong. Under the u. S. Election, but the global reflation has been in place. Dont know,in, we people thinking it will happen. I guess by believing that, you can create it. Weve had instances of where people have talked themselves into a recession. David certainly true. Rishaad what will 2017 bring for equity markets . David more of the same. Reflation will win out. Global fundamentals are better, an emergence from an earnings recession led by the u. S. , but revisions and europe and japan. Fundamentals stabilize for the first time in 45 years, so if the global fundamentals are allowed to us or themselves, i. E. The political noise does not dominate, we think it can be another decent your for equities returns. The bondwhat about market, is the bull market over in your view . The projections are ridiculously low. David yes, we think the reflation that started is part of a bigger trend. Consolidation with the yields having gone up too far too fast. We cannot tolerate significantly higher levels of interest rates, so i dont think we should celebrate yields rising quite as fast again this year as they did last them otherwise we may run into trouble. Rishaad thank you very much indeed. Some breaking news, the chinese Property Developer down 9 in the session. The reason why, looking to diversify beyond real estate, looking at tech, farmer, finance, and resources deals. The developer taking a 2. 2 billion bet on three technology companies. The chairman says the company views real estate growth stagnating from 2026 onwards. He is looking quite a long way i heads. A reported megamerger between two players in the global i wear industry. This is bloomberg. Rishaad luxottica has agreed to merge with essilor in a deal worth 53 billion. Will this deal work for both parties . It seems to be a good one in terms of synergies, a lens maker, the Worlds Largest lens maker, combining with the largest sunglasses maker. It seems like a natural. This is also a great deal for the chairman and founder of luxottica, italys second richest man. He came back in and took the company over from ceos that did not work out, saying he will make some big deals, and now he has made one. Rishaad it looks like the biggest crossborder deal in europe for some time. It does seem to be a surprise given that there has to be regulatory issues here. They would have a huge market share. They do. They have not discussed the possibility of a deal between the two companies a few years is associatedor in the medical business, a high tech race they are working on. Both of these companies have been in discussions before, but it was a bit of a surprise they were able to make a deal this time. In the past, the stumbling block is that essilor did not have much of a consumer side, and now they have built one, and that opened the door for this deal. Rishaad thank you very much indeed for that. Looking at what is going on with the markets at the moment. Japan with better than expected machinery order data. Bears and charge of the moment. 7 . Ikkei down scandal,e influencing the indictment of the National Pension chief there. Australia and new ne zealand on the upside. China warning donald trump about the one china policy. Also, the start of the trading week here in hong kong. Rishaad this is Bloomberg Markets asia. Am Rishaad Salamat shanghai and hong kong about to open, reaction to what has been happening in terms of Political Developments over the weekend, data in japan, better than expected macro data, machine orders, pti not as bad as economist thinking there, but factory gate numbers, wholesale prices, still negative, so the tendency for cpi, the Consumer Price inflation gauge, looking like it will perhaps be under no pressure to rise in the short term at least. Taking place when it comes to new york, Martin Luther king jr. Day over there, so bond markets and equity markets are closed. That is what we have at the moment. Lets find out the trading session and the market open in hong kong. Heres david ingles. David right. The timing of the open across these markets could not be much worse, as far as the day is concerned. A lot of markets falling, tie of aower, australia little bit below. 5 . The commodity markets, the rally, iron ore, 638 right now, the may contract. Hit 68 weeks we ago was 645. Have a look at rubber, 5 off the highs. If you flip the charts, it takes you all the way back, have a look at this. Your 63 . There are floods in thailand, the worlds biggest exporter of rubber, and that is threatening to cut supply by 20 . That is adding two reasons why people might be speculating on rubber. There is your price, right. Have a look at the open in china, hong kong, the philippines, not a lot there, the fixing, yeah, quite boring, strengthening for a third day, but we have started to see an unwinding of dollar strength. Go,philippines, there we 7231. Can we get shares of sunac up please . Billion, leeco market expansion, markets not liking that one. It could be an adjustment, depending on how much it is spending, the assets. Wrap things up with the top story for today across markets, the british pound, sterling fell below 1. 2 zero. We have recovered that, but that is academic. When london opens in a few hours, we might see a rebound there. Path of least resistance for the pound is down. We could be testing the less we hit during the flash crash. The a look at euro, 110 was low. We have seen some weakness in the euro. A lot of buying of protection, there we go, pounddollar, cable there, 9 up. That is the level at the moment. That is a threemonth high there. Something to watch, especially when london opens up. Risk this a lot of week. We will continue to follow the story. Muchad thank you very indeed for that. Lets get you caught up with first word news. Haidi lun, good day to you. Li kashing seeking to expand its Energy Assets, buying australias duet group for 5. 5 billion, the deal subject to regulatory approval, but expected to go through by midmay. Tos is the latest attempt bolster his australian business. He suffered that setback last year when he moved to buy a grid wasstake in oz blocked. Senator rand paul developing his own alternative to obamacare. He told cnns state of the Union Climate drivest up costs. Donald trump has pledged to repeal obamacare without having outlined an alternative. The outgoing director of the cia has said Donald Trumps comments outrages, speaking on fox news, john brennan suggested the president elect is not have a full understanding of russias capabilities and intentions. The comments, amid escalating tensions with the Intelligence Community following allegations by trump in recent weeks. And vietnam have come to a tentative agreement on their overlapping claims to the South China Sea. The two countries have promised to manage maritime differences and safeguard the stability of the area. It comes as Vietnams Communist Party chief wrapped up a trip to china over the weekend, where he met with president xi jinping and premier. Global news 24 hours a day powered by more tha