Kongshanghai connect. From the just pictures trading room floor. That is what we have at the moment. We seemingly are finally there. It is just half an hour away. Market swinging open to Foreign Investors in a limited way. It is the Hong Kongshanghai connect. We have dave watching the action from the Credit Suisse trading floor. What is the mood like there . Good morning. As you can hear from the guys behind me, the decibel level is getting louder. We are entering 30 minutes before the open. That being said, a lot of focus today will be on the backend. A lot of investment and a lot of time, not only from the exchange, from brokerages, all throughout the industry, they have gone into making sure this open will be very smooth. I just want to mention as well, when we talk about these daily quotas, a lot of chat has surrounded that, is it big enough, i want to focus more on the overall. Billion. Oking at 3. 8 just to give you a statistic here, if we use up the daily quota for the next 23 days, nearly into christmas, we will basically be using the entire quota for this program. We will see how much the appetite is based on our survey. 81 of brokers think that we will hit 3. 8 billion. Rish . David, we thought some of these issues would have been dealt with by now but we still have some of them. Louink it is charles speaking at the hong Kong Exchange. Is we are witnessing [inaudible] this would not have been possible without the massive fromt of effort and help everybody involved. On the hong kong stock exchange, i would like to thank the central government, the hong kong government, our regulators and our exchange. Thank all the bodies who have worked on this project, and participants working for us. Without all of these efforts, we would not be here today. As we can see on the screen, our friends in shanghai are beginning their ceremony as well. Shanghaihong kong connect represents a new opportunity of investment. The beginning of a new era. It is a privilege for us to all be here together celebrating this great occasion. [speaking chinese] the shanghaihong Kong Exchange their, a string a new hering a new era as he put it. Just got some outstanding issues, david. Lets get back to david at Credit Suisse. They are starting to be a bit more tedious than buying. Not exactly a lot more work but a lot more preparation has to go into selling. When you place a buy order in hong kong, all you need is a hong kong brokerage account. When we talk about selling, we talk about predelivery. The day before or a small window before the trading day starts. That has been brought up as one of the Sticking Points here. Risk, justunterparty in case your brokerage goes underwater. There is also the issue of front running. That said, there is a fix that some of the brokerages and banks have put in place. A good example of that is adding clearing and Custodian Services in order for your clients to be able to place sell orders the whole day. It is the first day, rish, and because of the odds of that Sticking Point that you have to place your shares with your starts,e before the day today will only be about buying shares. That is all going to be buying at least for today. Let me also mention, there is still no clarity on shortselling in shanghai. Lets not take anything away from it. It is a breakthrough on a lot of fronts. We are counting down to the open for the Hong Kongshanghai exchanges which happens in about 20 minutes from now. David, thanks for that. David ingles in the Credit Suisse trading room as he shanghaihong kong connect gets underway. Lets get more from the shanghai perspective. Stephen engle is on standby for us. Steve . Time of the roof off International Finance center, in the center of the financial district in shanghai, the rooftop of the ritzcarlton. It is a momentous day for shanghai, of course. For the International Investors, this is unprecedented access into the mainland markets. The report is, the individual brokerage accounts and interest in the market here. For the chinese side, this is a further opening up of the capital account in china. Further proxy for the reform process in china. Also, there is a reason i am here in shanghai. China has Ambitious Goals to make shanghai by 2020 and International Finance center. Not to diminish the role of hong kong but to complement it. They have been touting this as a very important step. There is a quota and that will probably be used up quickly. It is a first step in the whole process. Bringing Institutional Investors and individual investors into , of market has its risks course. This is a highly speculative retaildriven market. I talked to the chief economist with j. P. Morgan chase and he said this, along with other programs in place are baby steps and should help lessen the speculative volatile nature of the shanghaiasia market. That is why the government is highlighting that importance of bringing Institutional Investors and the Hong Kongshanghai stock connect program. Thefully, that will reshape investment base in the stock market. For the Global Investor, this opens up more opportunities for different sectors to invest in here in the chinese market. If you look at the index in hong eighting off the wie that index is financialrelated companies. They will now be able to invest in midcap, small to Medium Sized Enterprises in various Industries Including consumerrelated goods and industrials. Consumer trend is the big one here. This gives International Investors a broader avenue into this market. Steve, thank you very much indeed. Joining us from shanghai as we get the Hong Kongshanghai connect underway. Lets find out more on the story which is dominating headlines. Hong kong bracing for legal action at any moment. Papers published over the weekend confirm those blockades can be removed. Andrew davis is here with us now. What are we looking for . Published inwas the newspapers to enforce this injunction. The students lost their appeal to block these injunctions. They only focused on three parts of the protest area. Little sliver of the admiralty protest. This doesnt mean they are going to clear out the whole thing. ,hat if they take down mongkok which the protesters are blocking some key intersections that are disrupting travel and commerce in a bustling commercial district, that will probably be the first step of bringing this to an end. Police are assigned to help the Court Bailiffs come in and remove the barricades. Pictures are coming through of the action in admiralty. You were saying this is to areas. The part of the admiralty area that can be taken down is just near one office building. That big a space. As you can see from these images, there are hundreds of tents out there. I dont think this initial clearing is going to affect that. Once they start taking people off under threat of arrest, it is probably going to be the beginning of the end. It is just losing momentum. We do see no doubt, we will get something when it comes to the Hong Kong Market as well. Andrew, thank you very much indeed. Another red flag from china, bad loads jumping this quarter, up by nearly 12 billion. Sources telling us senior governor figures have discussed lowering next years growth ofget on its current level 7. 5 percent. Japans biggest banks are out with results. Decline dueosting a to overseas lending. Quite a different picture for smaller rhizome rival mizuho. You also had a decline in lending taking place. Japan is back and recession. The economy contracted for a second consecutive quarter. Annualized gdp or should i say contracting 1. 6 . What does this do . It raises the odds that the Prime Minister will delay aprils planned sales tax hike and call for a snap general election. John has been gearing up for the shanghaihong kong open. About that japan story, the growth story, the yen falling on the back of that. John dawson is here with a look at that and more. Japan right now is in recession. Two quarters of negative growth equals recession. The economics means that the ricochet affect is Prime Minister abe will hold a press conference and delay the tax rise. This year, it went from 5 to 8 . Clearly you see the reaction has been negative. Only nine gainers, the rest are decliners. All exporters, engineering companies, all these are falling. The biggest gainer, toray industry, has confirmed that it won a one trillion order from boeing. It also makes cycles for the tour de france. Australia is falling 0. 5 . Japan is falling the most with 2 . We look forward to excitement and a bit of caution, hong kong and china when it comes open in about 10 minutes time. We look forward to reaction to that. Backed of these live pictures, this is the ongoing ceremony. That is the hong kong chief executive. The Hong Kongshanghai connect is now underway. Leung very much part and parcel of this opening ceremony. The new Market Access one, [inaudible] hong kong has the combined advantages of one country and two systems. We offer the unique feature [inaudible] we are the connector between the rest of the country and the rest of the world. It will be an upgraded version of hong kong as the connector to and from china. The government will now work with the central government. [inaudible] i offer my sincere gratitude. Once the soft connect starts, there will be close monitoring by the government. Thank you. [applause] on the Hong Kongshanghai stock connect with gets underway. They are expected to be we have to take a break. We have a 2 trillion promise from the g20. Was the summit a success . We are going to head to brisbane. On the move is back in a couple of minutes. The g20 summit concluding in brisbane over the weekend with the promise of 2 trillion in extra Economic Growth taking place by 2018 with a series of reforms. Lets get to sydney. Thanks for joining us. What did you make of this promise . What did you make over of this summit . From a economic perspective, i think it was a great bit of policymaking. We got a strong commitment from those leaders to try to lift Global Growth. The interesting thing from a macro perspective is the recognition that demand is weak. There is a lot of detail in here around Structural Reforms and infrastructure. That is important. A recommendation recognition that demand is weak. That monetarye policy would be easier for longer, but this talk of alcreased fisc flexibility may see more consolidation over the next few years. Of the actual policy recommendations and propositions growththe 2 trillion of , that really is a political issue in the sense that the policies have to be implemented. Here in australia, a number of oppositions are still trying to get through parliament. Variousds whether the countries can implement the policies to get that growth. My assessment is that this is a good, strong policy announcement for the World Economy for the next few years. Many people have pointed to it being woefully short on some of the structures they are proposing. What is your view . The detail is obviously always important. The political ability to execute the policies each country has its own agenda and policies it has to implement. There is going to be this recognition that they have all committed to try to do something. One of the things which could boost credit in australia is this possibility of a chinaaustralia free trade pact. We could get this this afternoon. What is your view . We are expecting it this afternoon, in a few hours time. I think the word in the last day or so is that it will pleasantly surprise. For australia, the opportunities in chinas markets around Financial Services, particularly around agriculture, we will have to wait and see. This could be a strong, positive announcement for australia. For china, it is all about the investment opportunity. The ability to deploy capital into australia and lift some of the restrictions we have seen in place. It is looking good area good. Great walking to you. We have to take a break. Still on the way, japan is technically back in recession. What impact is that having on the weakness of the yen . Foreign headlines right after this. These are your fx headlines. A sevenyearng to low as growth came in far weaker than consensus. The economy struggled for a Second Straight Quarter with an unexpected contraction. Dollar, retail sales rising 1. 5 . The finance minister saying that the qe price in the mid to high 70s is now sustainable. In brazil, the real fell to a etroglasr low after pt postponed its report on corruption and money laundering. Those are the headlines this monday morning. Chineseext opening, stocks. Thehe show hong kong Hong Kongshanghai connect. It is just moments away. , thiss is the top story is the scene in hong kong. Cy leung there. We also have the chief executive of the hong Kong Exchange on the far left of your screen. Hong kong andg shanghai investors buy and sell shares. They are quoted northbound, pretty much completely filled up. Is notouthbound, that filled up. That is what expected. The scheme expected to be northbound initially. , 13 billionota yuan. At theave a quick look start of this new session. On shanghaistock shanghais hong kong the shanghaihong kong stock connect the chairman will now [inaudible] i would like to propose a toast to the success of the shanghaihong kong stock connect. Cheers. [applause] distinguished guests, please stay on the stage so we have some photo opportunities. A bit early for champagne but that is what they are drinking at the moment. A historiclling it day for hong kong and shanghai. The two bosses get closer together with Foreign Investors having less fettered entrance to the chinese market. The retail class in china being able to buy hong kong shares as well. Lets get to the markets. Offhang seng was on a fly the back of the positivity surrounding all this. Japan is taking a thumping because of worse than expected growth. John dawson has been looking at it all. Very positive for the Hong Kongshanghai connect, which was just launching. Up by a percent already, way past the level of 2500. That is a good start. That is the Hong Kongshanghai connect. What is that, doing . Similar story. Also seeing gains. The bestperforming indices across asia happen to be hong kong and shanghai. Question mark is the tax. There is a temporary relief of the Capital Gains tax for the overseas financial institution. Also temporary relief for the asian investor. Clearly, no Capital Gains from shanghai buying into hong kong. Will that change . How will it change . How long is temporary . These are the question marks that maybe rattle a few nerves. Lets go with the positives. Both indices seeing gains. The picture so far for asia. If i add in the opening for hong kong and shanghai, there is china with gains now. Hong kong is here, up by 0. 2 thirds percent 0. 6 . These three, you can see, the best performers of the day. Performers, they are really benefiting. In china, we are seeing with significant gains. A few decliners but it is a positive day overall. The nextdoor story is, shenzhen. When will that connect . ,he tax question mark temporary, how long is temporary . Absolutely. Temporary is something we are watching for as well. John was saying there that they would temporarily forgive tax on of thismade on the back connect program. Credit suisse is in the mix. David is there at the moment. And us about the atmosphere how that is evolving and whether we have seen any size of relief . To start innt october. Many thought it wouldnt get off the ground. Exactly. I was just speaking early on with the chair of Greater China equities. She said that clarification that havent play on friday when chinese policymakers basically said theres will not have to pay Capital Gains tax, that was a big relief for a lot of people. That is providing of a closed across the markets right now. With the atmosphere behind me, i can barely hear. The method will increasing. I am not going to tell you what the orders are not i am hearing a lot of corporate names. That just get some numbers for you very quickly. We did a survey. Are expecting northbound activity, money flowing from hong kong to shanghai. You cant sell today. Expectbrokerages northbound activity to be filled up. 50 think southbound, the bethbound daily quota will filled up. Just to give you a sense of what is happening behind me, perhaps you can hear some of the traits that are going on for lack of a better word, very active. David, you are talking to some of the sales traders and the equity team. What are they talking about . Just to give you some context, the guys behind me Credit Suisse came out with a few names that they mentioned. Typical ones. Ncent,ong stocks, te lenovo and other interesting targets for mainland investors. , and the hongda Kong Exchange which is up over 1 . That seems to be a fairly common theme. You look at the picks from other brokerages as well. Bnp, you are also looking at tencent in there. Automaker,ing at the dairy, i could go through the list but we would be here all morning. We will continue to watch what is happening across the markets. A fairly momentous moment in hong kong. 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