tv Bloomberg Markets Asia Bloomberg November 3, 2016 9:00pm-10:01pm EDT
airlines looking to rein in costs in the face of competition. shareholders fail to click with gopro as investors see a gloomy holiday season. singapore, taipei, all in the next. thesehave a look at how markets are tracking, one direction only, david. direction, the color it away, on gives the way down, especially the nikkei. there is an element of catch up here. trend is down, poised to into the week on a lower note. the week on a lower note. the markets have been edging down for eight straight days. you have the jobs report later
on tonight. investors are paring back exposure to risk assets at the moment. markets as you can see on the way down. a lot of this comes down to election jitters ahead of early next week's election. currency markets, one currency moving because of domestic issues, the pound. we will talk more about that later on. we are looking at a 4-5 week i. aussie dollar, the quarterly statement from the rba. it shot up after that. we traced a lot of that move up. highest level in 2-3 weeks for the pound. a 7-8t the moment, but straight days of gain. have a look at where we are.
have a look at longer-term charts. week has been special in a lot of ways because it is the first time that prices have been trading below their 50 and 100 day moving averages since september, so we are pushing towards the 200 day moving average. ta, there we go, lower. givenas flagged earlier the fa that it might cause them bankruptcy in the u.s. rishaad: this is coming in, shares resuming trading, down nearly 5%. the biggest vehicle recall in .istory, shares suspended from the nikkei
newspaper saying they could be seeing a chapter 11 bankruptcy for the company's american unit. a possible bankruptcy firing in the offering, shares were suspended. at the what we have moment. let's take a look at stirling, the pound had a couple of shots in the arm, a four-week high after the doe decided a rate cut might not be needed now. hold a votent must in parliament before leaving the european union. mark carney raising concerns about recession risk before the vote, why is he changing his mind? >> in august, the vote was yes. mark carney had pounded the table, saying look out because leaving the eu could be very hard on the u.k. economy and
probably cause a recsion. in fact, the bank of england thought the economy would be so week by november that it would need to cut the key rate, but the economy did not come to a halt, so it looks like those rate cut plans have. here is what mark carney said earlier. that theains the case path for monetary policy will depend on the evolution of the prospects for demand, supply, and the exchange rate, and therefore inflation. monetary policy can respond in either direction to changes in the economic outlook as they unfold in order to ensure the return of inflation to target. >> some big changes in the outlook for growth and inflation over the next couple of years. bloomberg intelligence in london put together a bar chart that shows the picture beautifully. august, the yellow bars, inflation would gradually rise. look at those orange bars, that
is from the november meeting forecast. see inflation near 3% by the beginning of 2018. remember last week when mark carney told the parliament that the boe could only tolerate so much inflation overshoot. other point we want to look at now is gdp. thought theoe fourth quarter of 2016 would be flat. now, they are looking at growth of 0.4%. it is not as bad as they thought. so bloomberg intelligence saying that the boe will not cut the key rate in february. in fact, they say that boe is on hold for the foreseeable future. rishaad: you caught up with the novell lori paul krugman and talked about the boe decision. when did he make of it? >> he does not agree with it.
it is very interesting because paul krugman in june when brexit heated up said it won't cause a recession. he disagreed with many economists, and we see he was proven right, although we have to give mark carney credit for moving aggressively. let's jump into a bloomberg chart now. measure ofimple economic uncertainties, consumers, businesses, look at that spike at the right-hand side of your screen after the brexit vote. it is still at a relatively high level. paul krugman said that the boe at this point is just not seeing the economy properly. i don't see the case for hiking rates. blip inl be a brief
inflation because of the declining pound. you still want some notion of core inflation that will include prices that will be volatile with the exchange rate. is policy is still tight everywhere, including britain. >> he also thinks that boe should have kept that easing bias, because like so many they face ations, deficiency in demand. thepayroll reports may give fed the extra ammunition it needs to move ahead in december. rishaad: thank you for that. let's get to first word news. the race to the white house is getting tighter. clintons out, hillary holds a slim lead over donald trump. tooll has clinton ahead 45% 42% among likely voters, tighter
than her nine point lead in the same poll last month. abc newston post tracking poll has the race closer with clinton ahead of trump within the margin of error. india pushing ahead with its biggest economic reform in decades. a government panel has agreed on a nationwide tax rate of 12% and 18% for most goods, while grains will be exempt, luxury and tobacco products will be charged at a higher rate. the government plans to rollout and willms by april need $7.5 billion to compensate state for loss of revenue. politicals says the scandal in south korea will ultimately be good for markets. that the corruption probe involving the president is frank calls for reform and will make the country a more attractive place to invest. fund hashe asian stock
outperformed its peers. has purchased dick clark productions for $1 billion. it marks their entry into the tv industry. it is the latest addition to billionaire wang jianlin's growing empire. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. rishaad: thanks. right, five days to go before that u.s. presidential election. the latest polls show hillary clinton has a slim lead. both candidates have expressed opposition to the tpp deal. is the deal really dead? colleague haidi lun and is standing by with the country's
finance minister. how are they positioning themselves on this? the general mood is still optimism going into next week's vote, but australia has a lot of in in the game when it comes to tpp. australia's finance minister. been talking about the two u.s. presidential candidates opinion when it comes to the tpp, are you still optimistic? a lot of people are saying it is dead in the water. >> it is an important agreement that covers 40% of the world's economy, and from australia's point of view, we are quietly hopeful there is an opportunity to pass the agreement through the u.s. congress. world trade and economy would benefit. if it is notappens pass?
?- passed do you work harder to reestablish these bilateral deals? >> that is what we have been doing. we have been able to finalize free trade agreements with china, south korea, japan. we are focused on finalizing a free trade agreement with india. are working with the european union, so we will continue to pursue bilaterally. a good opportunity for the world economy that should not be lost. haidi: if it is scrapped, what kind of signal is that giving to the idea of global trade given that we have seen this rising protectionism? >> the global economy has gone through a challenging time since the global financial crisis. there is anxiety and communities around the world. government and business leaders need to take that into account
and work to address it and make sure we take people with us and explain the benefit of open economies and international trade and investment flows, and how that will continue to drive living standards. trump has seen a resurgence in the last few days. gameyour government have a plan on how it plans to deal with a trump presidency the policy it might entail? >> in the australian government will continue to work to have a good relationship with whomever the american people choose to be their president, so it is in our national interest for that to be the case in the future whatever the outcome next week. , therethis trip in asia has been confusion, especially from domestic media and china about transparency, the clarity, when it comes to australia. you've had a couple of bad headlines. is that something you are here to address? about 10,000 foreign
investment proposals have been assessed through our foreign investment review board process in the last 20 years. only five of those proposals have been rejected on national interest grounds. all is an economy that is open to foreign investment. rely on foreign investment for our economic development and prosperity and continue to attract foreign investment. like any country, australia does have a process to ensure that any foreign investment proposal is not contrary to our national interest. i think people across the world do understand that. we are always open to suggestions. from our point of view, it is important the australian people have confidence in the integrity of that process to ensure that foreign investment continues to have support. is a sense of dwindling public support when it comes to foreign investment and
australia, particularly chinese money. >> i'm not sure if i agree with that characterization. the assessment we made our not country pacifi specific. some transactions are more .ensitive any sovereign country has a process in place to ensure foreign investment is not contrary to the national interest. haidi: china's ministry of asmerce called the decision being hopeful, reductionist, distance and devising companies. surely that is a problem. >> we don't accept that characterization at all. it was not a country-specific decision. it was related to the assets, and we made a decision as any other country would. haidi: certainly you can make it
clearer? when weese occasions travel to asia, we go out of our way that we provide explanation. haidi: clearly this is a recovery that has in large been driven by a very robust property market, rebalancing when it comes to getting away from money investment. are you feeling optimistic? in au feel like we are good place at the moment? our economy continues to grow strongly. 3.3% growth in the most recent od, higher than any g7 economies. thate quietly confident the reforms we put into place together with features in our system, low interest rates,
lowting exchange rates, wage inflation, all of it is being taken together. our investment in infrastructure is focused on innovation and a free trade agenda. australia onto put a strong economic foundation for the future. haidi: are you comfortable where the aussie dollar is at the moment? >> the value is determined by the market. haidi: thank you very much for your time. back to you. that was australia's al finance minister. rishaad: nice one. let's tell you what is ahead. china looking at what makes a brand relevant to the chinese consumer. more on the fortunes of the austrian economy. we will see what the reserve banks for crest -- forecast for growth tells us. this is bloomberg. ♪
showing gains after the release of the rba quarterly statement on monetary holocene. let's find out the details. all allen is in sydney. it is not signaling much change, is it? paul: not really. to 3.5% through 2017, not huge change there. noting downside risks have diminished to chinese growth. minister saying the forecast for tradable remain above the low point in 2016. recentk encouraged by improvements in pre-commodity prices to our straight particularly the price of coal. it is weak inflation that has got us to where we are now. the reserve banks these that 1.5% to 2% by 2018.
the labor market is weaker and there is uncertainty over household spending. increase ofted the house prices. the aussie dollar did rise on the release of the statement, but has since that'll back to pretty much where it was before this was released. suggestreally here to the reserve bank might be moving on the cash rate anytime soon. thanks for that. paul allen in sydney. that is what we have at the moment. should have a premarket auction price for the hang seng, having a look at that. indeed, we don't have it just yet. yes, we do. down by .3%. more coming up. this is "bloomberg markets: asia." ♪
the pc industry revenues fell for a fourth straight quarter, shipments slid. we are looking at the gloom and doom, the global pc market. reflected ining lenovo's results. you will see quarterly profit did beat estimates. net income at 157 million dollars instead of $87 million. revenue beating slightly, but still dropping 8%. thatroblem here though is they mostly be because they had a gain from property sales, a huge gain of more than $200 million. this is not the first time this is happened. straight second quarter that lenovo has unloaded real estate, so they acknowledged they have tough conditions ahead.
when they announced financial results, they said the market conditions could remain tough in the short-term. the company is investing to drive long-term growth. marketow that the global is bad for them right now. they have aon that lot of challenges from hewlett-packard, dell. in fact, lenovo's lead shrank to the smallest for the quarter since 2013, when they became number one in the industry. rishaad: how do they beat this industry slump? can they beat this industry slump when it comes to personal computers? coulds something you argue is structural and a market that is becoming commoditized. is mostare doing what natural and obvious, cutting costs, more than $1 billion. also slashing 3000 jobs, but they are trying to diversify their business. they are going further into the server market.
rishaad: that's it. if you can't beat them, join them in diversification. have a smartphone business, don't they? inthey bought out motorola 2014, but that was real bad timing because of the economic slowdown, so turning that around has been tough. down 12%e division is on year, but quarter on quarter, boost inch 20% from a sales in india, new models as well. the losses are narrowing slightly. rishaad: thank you so much indeed. minutes away from the start of the trading day in hong kong, shanghai, so let's look at the futures, suggesting a decline by .3 percent, also reflected when it comes to the index futures. it is a global selloff. europe, the ftse, the dax, all down. wall street was also marginally lower as well.
you are back with "bloomberg markets: asia." i am rishaad salamat. we have a lot of volatility ahead of next tuesday, u.s. presidential election. , a gauge of fear, a ramp of we have seen in the last 10 days, and most of the volatility coming from moves and bets taken to the downside as donald trump and hillary clinton have been getting closer and closer in the polls. she didble digit lead have in early october seemingly vanished.
putting this into historical context, if you look at it over five years, it is nothing like had then 2015, when we machinations of what happened in china and the market route that took place. that is what we have. hong kong markets about start. here is david. day to be angood investor. headingngle market down. you have the jobs number coming out. i look at the open, shanghai flat, hang seng .3% lower. perfect 10g for a for philippine stocks, 10 days in a row of declines. 22,611, the level for the hang
seng index. that is a 6% drop from the peak. chart withsame exact the moving average. the next stop seems to be the 100 day moving average. we blew past the 50 day a week back. there we go. so very close to the 100 day moving average there. let me wrap things up with a look at the commodity market in shanghai. metal prices on the way of. everything from iron ore, soper, gold as well, speculate we do not, but prices pushing higher. 932 a.m. in hong kong, 10:32 a.m. in seoul, korea, and now does the scene at the moment. the south korean president is addressing the country over the scandal that has an gripping the public in the past week.
park was considering making another apology in this address that started a minute ago. expressing her willingness to allow prosecutors to investigate her. we have a gallup career poll published friday showing public support for her nosediving. it was 17% before that. it is now 5%. this is all the back of that warrant being issued for a center ofriend at the this influence and all, which has been gripping the country at the moment. to have taken advantage of her relationship to meddle in state affairs. she apologize without saying what she was sorry for. her lawyer said she admitted to some wrongdoing, but we don't know what that wrongdoing here is. also here, president park to outline her plan to delegate her executive power on economic and social issues to
her prime minister. replaced the prime minister, and indeed, her finance secretary as well, and she is now expected to say she will focus on external affairs such as security and foreign policy. that is the scene at the moment in the south korean capital, president park apologizing for this influence peddling scandal which has been roiling markets and gripping the country there. she has just said that she does feel responsibility for all that, so that is just breaking news coming through the moment in south korea. increasingn under pressure to allow prosecutors to investigate her, and there is the possibility she may well be allowing that. see says she feels responsibility, and we will wait to see if she apologizes. one line dropping through, just then she is saying she will cooperate with prosecutors and the investigation.
let's take you to take to gaming and their -- let's take you to the gaming business. las vegas sands managing to blow -- blow awayen's estimates on its macau business. what is going on? that we interesting compare these two companies targeting to ins of the spectrum. of the spectrum. the mass-market brings that long-term steady revenue growth as well as profit growth. sands china the market lead in that particular segment. it is drawing a lot of crowds and business, and that is what
is driving improvement in all of these units. with also making them a profit margin lead. rishaad: we were talking about this before. the comparables are very weak. is it playing sailing from now? >> it will be dependent upon the mass market and whether that continues to grow. with this case, the push for tourism and molding it into a leading destination. sounds is positioned to grow -- sands is in position to grow. it has a new hotel, 13,000 rooms, meeting space, that's a wide breadth of products to choose from. rishaad: looking for the non-gaming revenues as well. a lot of these chinese punters can go elsewhere, the
philippines, singapore, even japan is considering a casino. >> that is interesting to look out for next week. the earnings call this morning with las vegas sands, that is very likely up for debate. the chances are higher than it has ever been. they are eyeing a soccer -- osaka. it would be a brilliant choice for las vegas sands. it has already built a reputation as a leader. it is well connected. it has a shortage of hotel rooms, so it is perfect for las vegas sands to go in and build its complex, just like it did with singapore. it will be interesting to follow it and see how they pursue that opportunity. rishaad: right, let's have a look at the aviation space. singapore airlines warning of the weaker outlook again.
the carrier is facing persistent excess capacity and aggressive competition. our southeast asia correspondent is in singapore. what are they going to do about it? >> it is limited what they can do. we are seeing reaction this morning. almostow, shares found 2%, adding to the losses already. as to what it can do well, it can keep an eye on costs. economy, weak global global uncertainty, impact and travel demand, putting pressure on yields. you alluded to this, rising competition for the likes of , thee eastern carriers so-called big three. all sorts ofring comforts, including in-flight showers. what ever it takes to win
business and first class passengers, they are doing it. you also have budget carriers chipping away in the economy class, so singapore feeling the heat from both ends. not surprising, it is struggling to revive profit growth. what it is also betting on is its flights to the u.s. those routes may drive profit going forward. is yield.sue singapore air has to get yield back up again. i want to show you how the shares are doing this year, down more than 10% year to date, underperforming the benchmark. , despite the gloom and doom, analysts rating singapore more favorably than cathay pacific and hong kong. i don't think there's a single
by stance to cover that one. singapore air shares trading close to their fall valuation. you can see exactly that when you look at the chart. that, they can only go iris first the market is concerned. thank you very much indeed for the. the trials and tribulations that singapore airlines. seoul, korea, the south korean ,resident has been speaking making an apology for this influence tiling scandal which has been going on, saying she will accept a probe if one is needed. she expressed the willingness to do that. she also went on to say that she feels responsible for the scandal as well. at the moment, there has been a lot of mystery surrounding all of this. there has been talk of a c ult, and she is saying there is
this andement in all says she is willing to take responsibility if any wrongdoing is found. an apology from president park surrounding this influence peddling scandal. we will have more on that. let's get you to what we have topping awith alipay list of relevant brands in china. we will have a look at who else made the cut, next. ♪
wins,ying that if trouble 1400. the risk is skewed to the upside. that being said, 1300, gold-mining stocks on the way down. ims metal getting an upgrade from j.p. morgan. a lot of pressure across the asia pacific for pharma companies. here is one. u.s. authorities might be filing the first case regarding this price-fixing investigation they have undertaken. we could see those cases filed before the end of this year. , takata reaction declining amid reports or will be filing for bankruptcy for its u.s. unit.
kkr dropping out of the race. , we are overn here. there we go. look at the map. we have a little bit of a spec there. philippines up for the first time in nine days. fourberg has been down for straight days. we are approaching a key support level for taiwan, the 100 day average. blowing past the 50 day, there we go. hopefully don't hold. we will see what happens next week. not a lot of risk ahead of the big weekend on the table at the moment. things are being put aside until we get more certainty with a certain event in the u.s. next week. rishaad: a look at the business flash headlines. resuming his
training day, suspended after reports that the u.s. division was planning to file for chapter 11 bankruptcy protection. it will disclose more information as it becomes available. buyerspany began seeking after regulators in the u.s. and japan that ordered recalls that were already the biggest in the auto industry's history. shares of noble group under pressure, indeed. the 800 million dollars sale of its u.s. energy division. it will sell the company to the houston-based corporation. shares unchanged. the ssl is part of the planned to return to profitability, something the chairman said will take 1-2 years. shares jumping 8% on thursday, little changed today. restarting discussions to resolve a legal dispute, the
conglomerate plans to reapply for permission to pay $1.2 billion arbitration award to the japanese company. sources saying the former chairman was ousted over his handling of this dispute. , china'slook at alipay most relevant brand. the survey ranked 10,000 chinese consumers covering 300 brands across 24 industries. now is j milligan. tell us what the purpose was here. relevance. isthe idea of relevance important globally, and more important in china. relevance gives to the heart of when consumers make decisions. whenu are going to win
consumers are taking out their wallet or paying with their phones, you have to be the most relevant brand at that point in toe, meaning having meaning consumers. relevance is super important for brands and business owners to understand, that's why we launched the survey. rishaad: you said it was no surprise that alipay was number one. >> they were heads and shoulders above other players in the market. out of the top 10, 3 are chinese. the rest are international brands. chinese.were 18 out of the top 50. that is a good sign for what the chinese are trying to accomplish. rishaad: this is a curious one. i don't know when this survey was conducted, but uber way ahead of didi in brand
relevance. >> what we found is that uber beat didi and all elements. didiery single element, was below over. didi won the business battle. lost $2 billion in china and got out of the market. hoover was consistently rated as more innovative and having a better product. that says the days of chinese brands copying western brands and winning can only be driven by finance, not the brand. the idea of bringing new services to the market, uber was record highs as more innovative and challenging the status quo. rishaad: when we look at visa and number three, where was union pay? >> number 17, still a relevant
brand. union pay is seen as less modern and less innovative. rishaad: you can't use it everywhere like visa. part of the survey that talks about when and where i want it, and visa was higher than union pay. there were 120 million trips out of china, and they can't use union pay as easily as visa. a huge: there is discrepancy here in that sense you have brand awareness and relevance. i'm not sure, but if memory serves me, coca-cola is the most recognized brand in the world, but it is not in the top 10. >> it is not in the top 150. into the mind you of the consumer. relevancy gets them to open their wallets and pay for it. that's why we think relevance is a much more and porting category.
the second-largest consumer market in the world, fastest-growing, and relevance is about the key moment when you're ready to pay. willness does not mean i buy the service or product and have a good experience. that is why relevance matters more. rishaad: i guess to be successful you have to leverage both. is there anybody doing that? >> you have to have awareness to get relevance. if you are not familiar with the brand, you did not get to rate is. the ship we had seen is that people used to be interested in brand differentiation, and now the industry has shifted to differentiation matters, but it does not matter as much as relevance, which has meaning to me as a consumer and makes me want to buy more frequently and pay more. brand,: disney, huge globally, a massive complex in only one there is
ocean park in hong kong, but it beats disney. >> it was very surprising. when you dive deeper into the disney was a top 50 brand and tier one cities, but only in the top 150 when you look at your two. our survey is a general market middle-class, soenta it is a general market. what was interesting about ocean on thisa really won idea of having relevance to me as a consumer. rishaad: what is the ultimate purpose of it? >> what we want to do is raise the discussion around relevance relevanceportance of and at those in china kno what will help them succeed with their brand. rishaad: coming up, the latest
rishaad: hong kong is waiting on a court ruling on two independent lawmakers. they had as the court to remove the politicians who protested against china's influence when they were taking their oath. what is going on? is thatperative word they are local less and pro-independent, and this is what has beijing's backup. they say you can have independent advocate sitting in the legislature. the cheek executive took this to thecourt and has asked
court on whether to rule whether you can have pro-independent legislators taking the oath or not, because they did not take her oath correctly. long story short, the court will make a ruling. the question is when does the court make a ruling. the possibility that the standing committee -- rishaad: is that why there is a big fuss about it? is.es, it the risk is beijing will step in and try to overrule what happens in the hong kong court and 80's -- twog candidates candidates can't take their of because of their pro, independence point of view. issue is whether the hong kong courts have full independence. rishaad: it goes down to that independence of the judiciary.
thend how that fits in with autonomy and the freedoms they go with that. they are guaranteed under the basic law, which is the constitution, and the whole idea of one country, two systems. the unusual thing is the chief executive along with that justice secretary put his name on the request made to the court , inserting himself into the whole thing. he is coming under a lot of criticism with lawmakers saying he did that to curry favor with show he is taking a hard stance against the independence movement. we have chief executive elections in march next year, and he would need asians support -- need beijing's support to run for a second term.
♪ announcer: from our studios in new york city, this is "charlie rose." charlie: larry kudlow is here, cnbc contributor and informal advisor. he hosted cnbc's primetime show, "the kudlow report." i am pleased to welcome larry kudlow back at this table. welcome. great to see you doing so well. larry: thank you, sir. charlie: wheo