♪ fearsd: geopolitical subside, optimism returning to the markets, a big day of data to keep traders on their toes. president trump saying the united states may rejoin tpp and sees great opportunities in china. tighten authorities policy for the first time in two years. in hong kong, i am rishaad salamat. haidi: also, a boost for indonesia. moody's lifting its rating. the agency says the outlook is stable. this is "bloomberg markets: asia." ♪

rishaad: trade concerns, what trade concerns? president trump hinting they could rejoin the tpp. on top of that, strong growth in singapore. china trade numbers coming online in an hour. haidi: these conciliatory remarks were taking down the tone or the rhetoric when it comes to trade wars, helping the sentiment and markets. we don't have any details as to findhe united states will its way back into the tpp, but we will speak with voices about how that will work. 30 minutes away from the open in china and hong kong. let's get it over to sophie.

singapore with its rate decision or tweaking earlier today. sophie: friday the 13th looking lucky for stocks. trump chatter about a return to the tpp is good for japanese equities. troubles the us -- kuala lumpur under pressure. u.s. futures pointing lower. let's get a closer look at the singaporean dollar reaction to policy,tightening retracing, but set for again. citing macroeconomic uncertainties remain. the singapore dollar has added 10% since january, now trading level trump' strongest

since 2016. we are keeping an eye on property stocks given the backdrop of rising home prices and efforts to cool the sector. ,ome prices seen accelerating supported by a shrinking pipeline and demand from local and overseas investors. have arean investors stronger than forecast gdp print to consider. we saw growth of 1.4%. one company has fallen to a 2016 low. no decision has been made. pension funds have stopped trading with the brokerage after the dividend payout that saw

$105 billion in paper value sold. rishaad: thank you for that. happening out what is , first word news wise. trump on record saying he prefers unilateral trade deals as opposed to multilateral trade deals. >> president trump says the u.s. may rejoin the tpp in the light of progress on what he calls unfair trade deals. a week after threatening $100 billion of tariffs on china, he said the two sides may end up loving no duties on each other. the president withdrew from the tpp in his first week in office. u.s. commerce secretary wilbur ross said his country will not give away leadership in the region and said corruption can not be tolerated and nations must create enforcement mechanisms to fight graft. in latin tariffs

america are unnecessarily severe. the u.s. intends to work with other nations to simplify the system. a new survey says the mood is darkening among u.s. retail investors. the association says the cap between those claiming to be positive and those with a bearish outlook is widest since february of last year. it is blamed on trade war concerns, escalating tensions in the middle east, and the fractious political landscape in washington. facebook is not anticipating major changes to its overall revenue and business model after mark zuckerberg's testimony to congress. the wall street journal cites the marketing vice president saying that most users have not changed their privacy settings in the past four weeks. after his grilling on capitol hill, zuckerberg has been invited to face three eu committees. >> it is a wake-up call to facebook and other tech

companies that consumer privacy matters, consumer empowerment is important. if you put the consumer first, you might not have to spend 10 hours in a hearing in the house and senate. we want to protect the consumer and want them to better manage the tool so they can make the decision. it is better if the companies incredible part of america's innovation fix the problems themselves. >> global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. i am paul allen. this is bloomberg. rishaad: getting back to our top story, president trump opening the door to the tpp, the free trade pact he spurned. has madehe u.s. progress in resolving trade conflicts with china. >> china is negotiating with us

, and wed, very long have made a lot of progress. we are opening it up and getting rid of those terrorists. you will see some true -- those tariffs. you will see some tremendous business openings. tpp was negotiated on behalf of the obama administration. it would seem all that hard work is not going to waste. this is an important plank of his election campaign. how does he sell it to the base? how serious ofw a u-turn this is or whether it was an offhand comment. there is a strategic logic to it. withdrawing from tpp will be seen retroactively as one of the biggest blunders and this may

reflect a realization that if our goal is to raise standards in the asia-pacific region and itslenge china to raise standards, tpp is a good tool. that is why it is so important the remaining 11 members of tpp move forward with the agreement, and it may have renewed interest in the united states in that pact as well. our american agricultural businesses might be hurt in a trade war with china, so tpp would give them market access, particularly vis-à-vis japan. , tpp has changed since you negotiated it. what has changed? , the tppnderstand it of 11 parties took a 20 positions that were

important to the united states and said those provisions would only come into effect if the united states were to rejoin. it left the door open to rejoin to doeated an incentive so by dangling the carrot of these provisions. that is a good starting point for discussion. i think the other parties would welcome u.s. entry on that basis. if the trump administration feels like it needs to major portions of tpp, whether there will be openness by other countries. haidi: this has dragged on for so many years and so many rounds of negotiations. do you think there would be any willingness for renegotiation if the u.s. was serious about getting back in? on what the u.s.

concerns are with the agreement as it was negotiated. members of the administration need to get their hands around that and specify what it is they would like to see changed. no country once to renegotiate it, but with korea in the context -- and the context of nafta, parties are willing to do so if demands can be accommodated, be reasonable. unreasonable, then it will be difficult for other countries to have their own politics around trade to reopen negotiations with the united states. haidi: is this a more effective way if washington really does want to suppress or curtail the rising influence of china, if it is an ideological and economic fight as many have pointed out? is this a better way of going about it rather than trade tariffs? >> tpp was not about containing

china, but establishing an alternative model based on high standards for the region. much in the is very interests of the united states and other parties to the world cane system, and i think it be more effective than a tit-for-tat over tariffs. it a better outcome when it comes to the institutional framework in place , like the wto? >> i think so. these are all the btl plus wto plusts at -- commitments. this is a way of advancing the ball. many issues that trump administration has rightly focused on and complained about these are the china, light state -- like state owned enterprises, international -- intellectual property rights protection, free flow of trade across borders. those are dealt with tpp.

it is a way of getting 40% of the global economy to hightially embrace these standards that reflect our interests and values, and that is a positive for grading momentum in the global trading system more generally. rishaad: mike, we have had trade tensions between washington and hasing as of late, what brought donald trump back to the tpp table? the second part of my question is how much can tpp help in that trade argument with china? , ofhe first is a big if course. whether this is a change of perspective or not, but it could be a realization that if you are really interested in creating an alternative model to china's approach, and the president has been quite critical of china's approach, tpp is a very effective way of going about doing that.

the fact the other 11 countries are willing to move ahead with tpp in the absence of the united states and access to our markets just chose how important those rules we negotiated were. i think it can be quite effective. it does not directly impact china, but demonstrates it they want to compete with their neighbors who are creating attractive places to do this by virtue of stable legal regimes, stable labor and environmental regimes, disciplines on subsidies and opening up markets, it creates a competitive environment where china will have to raise its game as well, and that is in all of our interests. absolutely, these tariffs and potential trade wars in the offing, many have said that america has legitimate complaints. that,t know your views on but not the right way of going

about it. how would you have gone about it? >> i think the complaints in many respects are real and legitimate. when the obama administration was in office, we approached it first by raising these issues aggressively in our bilateral discussions at the highest levels. we made some progress on those issues, including cyber theft of trade secrets. we brought 16 cases against won everyhe wto and case brought to conclusion, and helped to organize the rest of the world to put pressure on china when it comes to excess capacity, like steel or aluminum. i think the administration could have gone further and built an international coalition of support for addressing these issues in china, but it was made or difficult by taking steps that alienated our trade partners rather than attracted into our side.

that is the challenge we now face. the trump administration has done something unique, which is making china seem like the sympathetic party with other countries coming to the defense. the fundamental issue and the focus should be on how to encourage them to pursue an industrial policy that is less predatory, as some people call it, towards the rest of the trading system. getting theel, latest on nafta and president trump saying he is willing to renegotiate forever, if that is what it takes. you have been in robert lighthizer's shoes. how serious is the nine states when it comes to rhetoric versus actual policy, and does the administration know what it once when it comes to dealing with china and other trading partners? >> if you take nafta as an example, the administration is

clear and focused on the renegotiation, and has been specific about what it wants to see changed. 90% of what is being negotiated in nafta is chapters that come out of the tpp agreement, and those ought to be relatively and to close since mexico canada have agreed to them in another context. it is the last 10% is the most important. withare all resolvable flexibility and creativity on all sides, and that is where the question is now. given the short timeframe before the mexican election and our midterm election, the political calendar is not your friend in this case. getting an agreement in principle next month is a long way away from having a vote in congress at a time when the politics in our country may well change the nature of congress going forward. haidi: michael, always appreciate you coming on for us. froman talking

about this about-face with president willing to consider putting the u.s. back in the tpp. we will speak with douglas peterson about the biggest risk to the global economy and global markets, and taking a look at s&p's plans when it comes to asia. this is bloomberg. ♪

haidi: diplomacy by twitter, a turnaround on trade perhaps, volatility gripping the markets this week. let's get some analysis. we are joined by douglas peterson, the president and ceo of s&p global. justis normal or does it few unusual because we have come off a period of extremely low volatility?

douglas: this volatility is something many have been thecting, especially with changes people are expecting in interest rates. we have gone to a long period of the stable approach. the vix was stable for many years, but then started its volatility. there are so many dialogues on interest rates, global trade, political issues, so we will see more volatility. haidi: what are some of the big questions you are constantly being asked in this trading environment? there are always uncertainties, 18at it feels like in 20 these issues are changing day by day, hour by hour. take at of all, if you step back and look at the underlying global factors we get questions about, credit conditions, overall global growth, there are a lot of tailwinds.

we saw the commodity cycle become more positive. we see growth around the globe in almost every economy. there are only a few economies in the world in recessions, places like venezuela. the european economy has become stable. sectorancial services globally is strong. there are a lot of tailwinds in the economy, but we have depended over the last 10 years on a lot of fuel provided by quantitative easing. the new approach is providing liquidity to markets from the central bank, and as that starts looking at it is running out in some markets like the united states, you see quantitative easing moving to tapering and now unwind. there is still uncertainty about what that will mean. you get all those factors as positive, and if you bringing uncertainty or headwinds.

on top of that, you have political environment issues, north korea recently. you have questions about the global trade environment commits so these are the factors that every day on your show you are talking about with the different participants, and it is almost as if every day there is some new topic which bubbles up. rishaad: there certainly is. we live in interesting times. you are one of those participants in trade. china has been talking about opening up. i know you have to do business there, so you have to be different medical about where are you trying to get into china properly? haslas: first of all, china opened up the ability of ratings agencies to be 100% owned in china. we are meeting with government officials and regulators as they start developing the regulatory regime. if you step back and look at

china in another way, they have gone through years of steady and strong growth driven by a manufacturing export approach to economic element. over the last few years, they started shifting to a consumer approach, a consumption approach. they have a growing middle class that is asking for movies for entertainment come up travel, for consumption. they are looking for quality of life that will help improve the prospects of the financial sector, so when i look at the opportunities in china, i look at what is the evolution of the financial sector overall, what will be then needs of stronger bank programs, insurance, what would that mean for capital markets? look at underlying financial conditions and where the financial services market is going, i am optimistic about what s&p global could be doing in china and am pleased that we have an opening in the door. rishaad: could is the operative

word, the enormous opportunities, and this is the bugbear. we will be or we are? douglas: we think right now there is a lot of discussion going on with the trade perspective. you just had michael froman getting you insights on that. when i look at the recent statements from chinese officials, they seem to be very encouraged about opening up their financial sector and markets. how long will that take? what conditions will that take? we are watching back closely, but we're seeing a lot of encouragement and what has been coming out of beijing recently. rishaad: the thing is how do you get into china? do you buy a stake in a chinese ratings company? there is a huge on market there worth $11 trillion.

it is a big carrot, isn't it? douglas: well, it is, the third largest bond market in the world at the united states and japan, but still basically a bond market dominated by the banking sector. most of the bonds even underwritten by banks are bought by banks come and that will be interesting when it becomes a true securities market with insurance, pension funds, and asset managers getting into the market. you can buy, build, do a joint venture. there are many ways to go about it, and we are studying all of those carefully. haidi: where are you at in terms of potentially offering ratings services in the bond market? help me understand how it works. you do still have the invisible hand at this stage. beijing is involved and a historic reluctance for defaults, so how do you imagine

s&p can operate rating services in that environment? all, we havet of been operating in china since the early 1990's with onshore presence of our ratings analyst and other s&p global professionals. ofrate a large percentage chinese companies that issue debt offshore through hong kong or potentially london or new we have built relationships with a large number of chinese blue-chip companies as they have been accessing global capital markets. have been building relationships over those many years with the financial institutions, banks, insurance companies, regulators come and it is a matter of entering the market in a professional way, and we are looking for to trying that. rishaad: douglas, thank you for your time. great talking to you. thelas peterson is president and ceo of s&p global.

counting down to the start of the trading day. it is that lift we are getting from a thaw perhaps and multilateral trade in passes. there we go, hang seng up .8%. ♪ welcome to the xfinity store.

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rishaad: hong kong observatory, 9:29 in hong kong. greater china markets about to arrowlooking like an up story. out that has been taken positive by the trading community. donald trump suggesting there is a way for the united states to rejoin the tpp. also, he is ordering a special inquiry into the u.s. postal service, seen as another salvo at amazon. we had stronger-than-expected growth coming out of the city

state, singapore, changing its stands for the first time in two years. solid economic growth prospects for singapore as well responsible for that this year at least. back to the open, premarket up .1%. financials and information-technology leading the gains. sophie: ahead of the chinese trade update, we are seeing the mood lift across greater china, the shanghai composite rising .4%, the hang seng up .7% after slipping thursday. more optimistic view on chinese growth prospects. the world bank raising its outlook to six point 5% when it comes to gdp growth compared to adding forecast of 6.4%, to the cheerful update from the pboc governor regarding china's growth prospects. ae bond space, there has been surprise rally in chinese debt, picking up steam amid easing

liquidity and falling commodity prices. the 10 year yield has been driven to a six-month low. seen they have already highs for the cycle in january according to one analyst. it had its biggest drop back in march. that brought it back below its 200 day moving average, a technical pattern that suggests room for further declines as we saw in 2008, 2011 and 2014. the hong kong dollar looking steady. it bought local forex for the first time since 2005. the de facto central bank saying it is prepared to deal with capital outflows and the interest rate is expected to rise incrementally. the intervention is significant for borrowing costs, and commerzbank expects more intervention because it's view on the hong kong dollar is bearish dude to the liquidity --

due to the liquidity. we are keeping an eye on chinese drugmakers after report the government might eliminate tariffs for anti-cancer drugs. haidi: thank you for that. a lot going on. we are waiting on the chinese trade numbers for march. let's get you caught up to date with first word news. paul allen in sydney. >> president trump says the u.s. meet rejoin the tpp in the light of progress on what he calls unfair trade deals. i week after threatening $100 billion of tariffs on china, he says the two sides may end up living no new duties. president trump with the true from the tpp in his first week of office. al-assadesident bashar says western threats of military action are based on lies and are an attempt to weaken his recent gains around damascus.

washington,from harris only destabilize the region. the assad regime is suspected in a gas attack. the u.s. may order airstrikes. china has emphasized its growing military strength with a massive naval review. fleetmedia said the consisted of 48 shifts, including an aircraft carrier, 76 helicopters am a fighter planes, and 10,000 personnel. it is the largest naval review since 1949. its first dollar bonds in two years as regional security risk rise with the prospect of a strike in syria. the world's biggest lng exporter is offering $12 billion of debt in three parts, less than 48 raisedfter saudi arabia

$11 billion in the largest offering this year. is said to be more than $32 billion. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. i am paul allen. this is bloomberg. lot needs to be digested, china markets, tpp possibly, potentially, trade tensions seem to be receiving. you could not make it up, can you? >> you could not make it up. it is very fluid. , it islook at tpp interesting the u.s. is talking about rejoining. you say trade tensions are easing if the u.s. will rejoin tpp, but why is it rejoining tpp? it will do that to ensure it can take on china on the trade front. if you'rerejoin tpp

going to press china harder. rishaad: the thing is is it a recognition that they need to reassert leadership in this part , a sense that many have lost that leadership? ,> trump came in guns blazing appropriate given the backdrop in syria at the moment. he has many different targets in front of him in terms of trade. he is starting to focus down and narrow in on who is the most downtant target to knuckle on. you heard reports that nafta is close to being the renegotiated -- being renegotiated. if you're doing that, who will you have in your crosshairs. it will be china surely. rishaad: that's it. perhaps the lesson was learned by trying to start a trade tif, trade war, a zero-sum game. >> it is a zero-sum game to

china to a degree, but you only when that with others on your side. andi: michael, is this ideological issue with washington and beijing at the moment? is that the fight they are fighting, not just curtailing economic ambitions, but the global power ambitions. xi jinpingto shenzhen speaking, and he's putting forward a different option than the status quo at the moment. do you think that is what washington is worried about? >> i could not agree more. i think that is absolutely what it is about. basically they are talking their own book. they have skin in the game. if this does not happen, they stand to benefit, but that is a correct interpretation of what is going on. haidi: if what we are hearing is

largely wishful thinking, what which you recommend and do as an investor given we don't know anything at this point? >> in the short-term you can buy these rallies. you can buy into the optimism. the big boys are lining up and sang all will be well. that, but you have to remain cynical and understand the underlying fundamentals. if you understand the underlying fundamentals, the potential cold or-style clash, this breaks down and breaks down badly, so stand near the fire exits would be my advice. haidi: is china almost a haven in that situation? emerging markets and frontier markets outperforming, but this volatility-type situation you find haven in control markets like china. >> i can see the logic. if we say there is an ideological clash, then china is one that does not let countries

do what they want. the question is how do you get your money out. you can't take your money out. rishaad: it was interesting to hear xi jinping speak. he almost put china up as the leader of globalization. then he talked about opening up. you can't have the two together, can we? >> you can if you have orwellian doublethink. if they are leading, why change? is a successful growth model for china that has worked brilliantly for the past decades , but we have seen these growth models in other countries before, japan, korea. in the 19th century we saw it in germany, europe. you could even argue you saw it in the u.s. a long time ago, but it always great political tensions with other countries around it. rishaad: is it a hegemonic war by other means? >> for the moment by other means.

softly, softly, tentatively pressing here and there and seeing if hegemon can be shifted aside by using interest rates, financial markets, etc. we stay inow long that softly-softly phase before we get in a trade war. haidi: from trade to opening shots to possible actual opening shots, i want your views on the geopolitical situation. we have been waiting for president trump to come out with white house strategy on syria. he backed down after warning russia of missiles. is this a dangerous game going on them and how do markets position themselves given the side of the uncertainties we are seeing? >> we are at the other end of the silk road, and here it is real wars rather than trade wars , but it is the same thing. the greatest likelihood is

nothing happens because everyone can see the risks of so you go risk on at the moment, but the , it is a downside worrying situation. if the u.s. when in blindly and russia says we will not allow that and fight back, you have u.s. and russia fighting each other, to nuclear powers in syria. that is a very dangerous scenario and we have to hope that does not happen. rishaad: one last question with your research, you compared it to a hot bowl of chicken soup. explain. soup, i bowl of chicken must claim a do not understand the dutch expression as the dutch themselves. it is something you reach for when you are not feeling well, at least it is in my culture. rishaad: i thought it was because it was never hot as when it was first served. >> i am not dutch. rishaad: michael, thank you very

much indeed. you can catch up with our interviews using our interactive function tv . you can watch us live and dive into securities are bloomberg functions we mentioned. you can take part in the conversation. this is for bloomberg subscribers only. do check it out. tv . ♪

haidi: this is "bloomberg markets: asia." i am haidi lun in sydney. rishaad: in hong kong, i am rishaad salamat. japanese retailers, fast retailing raising its outlook. let's get to our retailing analyst. >> it is driving growth for both companies.

part of it is network expansion for stores. fast retailing, 10% plus growth for top and bottom line in the year ahead, but they are growing same-store sales in localizing products. in china, theye, are adding more skincare products that do better in china than japan. where the brand is not as well known, they are leveraging celebrity endorsers to dislodge entrenched competitors. rishaad: consumer spending remains weak. we still have wages going up slowly. , thedo these companies broader high street if you want to call it that, due to keep growth strong? >> they had done quite a bit better than their peers. prices done selective

cuts to drive foot traffic. once they have the customer in the store, it is all about up -- up sailing, so they train their associates to pitch higher-margin products to improve sales growth and profitability. for the other company, they have gotten themselves in trouble in past years with discounts. they have switched to an everyday low price model. they have done a better job of managing inventory. that has helped. athaad: let's have a look family mart, lawson, seven & i. this labor shortage as well, there are more jobs there. i think it's 1.5 jobs for every person in japan. what does it mean for future earnings? >> they are having a difficult

time filling that. the convenience stores are bringing students in from abroad who are studying in japan, but longer-term they are testing convenience stores and smart vending machines were you have dynamic pricing that changes on weather conditions, and also up selling you combos of food and beverage with customer loyalty cards. they are using ai to predict what the merchandise needs are. they look at the weather and figure out how many of umbrella's a need in their stores. thembrellas need in short-term. we've seen operating profit decline over the decade. .ong-term, it should help them convenience stores are looking to take advantage of that. ,aidi: the department stores they have been trying to offset what we have been seeing with

weak domestic spending and retail sales by bringing in overseas tourists. is that working? tourists are spending more time visiting historical and cultural sites, spending less at department stores, so that means they have to drive more customers to drive that growth. this is with the backdrop of some drug and others trying to attack the lucrative cosmetic space for them. we are also seeing that customers who come back a second or third time to japan are becoming bigger bargain hunters. they are going to other places instead of the department stores. doing betterme because they are focusing on the flagship stores, building up their cosmetics area, which is very lucrative, and using

payment systems to bring this customers in. haidi: thank you so much for that. how are bloomberg intelligence retail analyst. u.s. banks earnings season kicking off friday to j.p. morgan set to report. financials rallied ahead of that , largely helped by upbeat on earnings from blackrock. let's get it over to su keenan taking a look at the start of earnings season. what are we expecting given all the uncertainties? >> there will be a focus on how rate hikes are impacting banks. there is optimism because of blackrock, which beat the street. not only did blackrock rise, adding to anticipation and optimism about financial earnings, but the whole sector rose. the banking sector was up 2.8%. this is helped by this or regulation, higher ten-year treasury rates, and easing geopolitical tensions.

we are going into earnings on that. big banks reporting friday, j.p. 7:00 a.m.,e at citigroup, wells fargo. going into next week, more bank earnings, goldman sachs reporting monday. tuesday, bank of america and morgan stanley. again, a big focus here. ist analysts are looking for a december rate hike and a steeper yield curve affecting net interest margins. betas will be looked at, as well as capital markets. 7:00morgan, friday morning a.m., a credit suisse analyst is expecting a "solid quarter, very

strong." there will be a focus on their macro outlook. citigroup, another analyst looking for a solid year over year gain, macro outlook, capital markets. and wells fargo, how they have managed their balance sheet. late today in the u.s., there was a lawsuit reported to be a foreign exchange manager in terms of currency. cloud over wells fargo continues to be an issue. that will likely be the focus of analysts as well. rishaad: on that lawsuit, how much is related to that account opening scandal from last year? >> it is part of the general misconduct cloud. this is a former head of the foreign exchange group, one of four traders fired in the scandal. according to the lawsuit, this manager made multiple complaints

to his own managers about the potential fraud and regulatory violations in september 2017. he allegedly told his bosses of plans to go to the office of control, but was fired weeks before his meeting. there has been a probe into these claims. incentives forng the firm currency sales team to make false representations to customers according to the suit, and that is exactly the kind of allegation involved in these false account scandals allegations that are still being looked at for wells fargo and has given the bank a very big black eye. back to you. rishaad: nice one. su keenan in new york. bloomberg users can interact the . we use using gtd you can save future charts as well. tv .

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haidi: this is "bloomberg markets: asia." i am haidi lun in sydney. rishaad: i am rishaad salamat in hong kong, looking at the business flash headlines. were looking at the value of spacex. it keeps rocketing to new highs. $507ompany authorized a million funding round last week, taking the value of spacex to $25 billion. the bloomberg billionaires index says that would lift elon musk's fortune to $21.3 billion and spacex is set to become the most five able start up in america after uber and airbnb. haidi: airbus plans to win china's approval by the end of

the month from china. final specification is imminent after the turbo fan power unit was signed off on by chinese regulators this week. it was anticipated last year am a but that was held up after china sho sought recognition in europe. rishaad: building planes in india joining lockheed martin and saab. it would team up to make the f-18 super hornet. planes, an 85%0 built locally. provisionally $15 billion. haidi: we are looking ahead. at some stage we will get china trade numbers, first in the local currency. typically we get the u.s. dollar numbers after that. chart to look at this gtv

and look at donald trump's grievances and it comes to china. this is china's trade deficit. we expected to narrow in march. exports from china slipping to 11.8% from that almost 25% in february. 12% in seem to double to dollar terms, so watching out for that, but certainly a great deal of uncertainty, more than usual perhaps when it comes to this trade relationship between beijing and washington, risk. -- rish. rishaad: i want to bring up another chart. this is 6139. gtv . we are seeing china's trade surplus not peaking the way it used to, a bit of a down movement there. this is down to perhaps the economy itself and how we are doing, and also we see china move towards more consumption. forecast for exports to slow to

11.8%. jp morgan's senior economist joining us in half an hour to go to the numbers. ♪

>> it is a lucky friday the 13th for asian stock markets so far. andmism returning as trade geopolitical risks ease. china's march shipments, analysts see easing. the singapore dollar strengthening. tightening policy for the first time in two years. in hong kong, i am rishaad salamat. >> in sydney, i am haidi lun. coming up this hour, oil headed for its biggest weekly gain since july. this is bloomberg markets: asia. ♪

>> it is a happy friday for asian markets, risk on, paring off from the tailwinds we got from the wall street session. we are just getting these numbers when it comes to china trade at the moment. let's take a look at what we have in the chinese trade apart -- department. especially sensitive. let's get to beijing, tom mackenzie going through this chart of numbers. tom? tom: these are in yuan terms to read we will get dollar later in the day. first quarter exports out of china up 7.4%, year on year. imports looking strong, 11.7%. that is the import number.

again, year on year and in yuan terms. we are looking at a number of a 326 billion yuan. withrms of the total trade the u.s. over the first quarter, that was up 6.3%, year on year. focus given the trade tensions, we may have to factor in a stronger renminbi. the yuan is up over the dollar the past 12 months or so. number, of the dollar we were expecting a softening of the exports number we saw in february. --ruary saw almost 11.8%recast was for growth in march. imports, we were expecting to double. again, dollar terms from the 6.3% to 12%. we got early indicators they were mixed. imports.rs, around

the unofficial private survey showing weakness. we saw south korea's exports ticking up around 6% for the month of march, versus 3% or 4% for february. something of a bellwether for south korea, potentially suggesting these exports will be stronger. it looks like something of a moderation in terms of china's export. we are having to factor in trade tensions. china has imposed its own $3 billion worth of tariffs in retaliation for tariffs washington imposed. they were only imposed a few weeks ago. we will have to look at future months to get a better reading on how the trade tensions and tariffs are playing out. the u.s. still weighing out what $50 billion worth of tariffs will look like, and the potential $100 billion worth of tariffs trump has muted.

a couple months, we will see how trade impacts are affecting the data. it is interesting to see that in the first quarter china trade with the u.s. was up 6.3%, year on year. next month we get the gdp number. the forecast was for 6.8%. the governor says the data he has seen so far is positive, he is bullish on outlook for china going forward. a big caveat is whether or not and how these trade tensions play out. rhetoric easing is sustained, that could be positive for china. rishaad: hopefully we can get down to the u.s. particulars as well. the renminbi and dollar terms. let's find out more and had the

sophie kamaruddin. >> checking in on the reaction when it comes to the mainland, the composite looking higher at the open. index also keeping a cool head in hong kong. taking a look at the aussie dollar, we did see it taking -- ticking down, keeping the 77 handle. rate down about 0.2%. that is just the initial -- initial reaction to the yuan terms. they are waiting on the dollar numbers. taking a look at what is moving on the shanghai composite, the biggest boosts so far to the shanghai composite. when you look at the laggards, it is petrochina and sign tech -- sinotec. optimism around the energy space. the hang seng breakdown by

sector, leading the advance. up over 2%, followed by financials. consumer staples under pressure so far in hong kong. taking a wider look at how the session is farin across the region, stocks gaining groundg, led higher by the s&p. the yen injures more losses ahead of the trump-apec summit. -- trump-abe summit. moody's upgraded its outlook on the economy for staples and listed the credit rating to be a a2. oil on the retreat, but set for a weekly advance. base metals looking mixed with aluminum gaining in shanghai. aluminum will stay volatile through june. the bulls are looking wary of trade uncertainty.

haidi: let's get the first word news. paul allen here in sydney. >> president trump says the u.s. may rejoin the transpacific partnership in the light of progress on what he calls unfair trade deals. a week after threatening $100 billion of additional tariffs on sides maysays the two end up levying no new tariffs on each other. -- tpp was pres. trump: china is negotiating with us, very hard, very long. we made a lot of progress, opening it up into getting rid of those tariffs. i think we are going to see some tremendous business openings. >> a new survey says the mood is darkening among u.s. retailer investors. the group says the gap between those claiming to be positive and those with a bearish outlook is ever wider since a february

last year. the u-turn is lamed on trade concerns, tensions in the middle east, and the fractious political landscape in washington. westernl-assad says threats of military actions are based on the lies and in attempt to weaken them. senior iranian aid, he said the threats from washington, london and paris only serve to destabilize the region. he was blamed for a suspected gas attack. president trump has indicated the u.s. may order airstrikes. south korea may remove samsung securities from government bonds after its erroneous dividend payback incident. they accidentally gave employees 1000 shares each, worth about 105 billion u.s. dollars, or more than 30 times the company's market value. 16 employees sold the so-called ghost shares, triggering a

plunge in their stock. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. allen.ul this is bloomberg. ♪ haidi: thanks for that. president trump says the u.s. may rejoin the ttip -- the tpp. a look at how markets have been reacting to this. chris joins us from tokyo. we spoke to our guest, confounded by the market reaction. the reason the u.s. it gets back into the tpp again, it is almost the same result. >> yes. it is hard to follow the logic. tpp ifld you pull out of you think about a year later it is fine to get in? it is important to note the president said it needs to be

renegotiated, something that would be very challenging. these are a dozen odd countries. the initial negotiation lasted for years. trying to tweak it -- look how long nafta has been -- has taken to tweak. tpp would be an even longer process. it is hard to know exactly what he is thinking. one of the headlines out of japan today, one of the cabinet members was saying they want to know exactly what the president is thinking. for markets what is important is, even the threats on tariffs and so on, what is more important than the actual impact on the global economy, which is a seen as pretty small, it is more a sentiment thing. the rhetoric on tariffs and

tit-for-tat and protectionist that enhanced the risks that businesses around the world will start to think, geez, things don't look too good. we will curtail our plans for investment and spending. that could have a bigger impact than any impact from tariffs. really what markets are concerned about is sentiment. if things are headed in the right direction, if trump is saying tpp is good, we will move forward and make progress with china and not toward the antagonistic, protectionist route we saw in recent weeks, headwindsts see no from that front. they can think about earnings releases, instead. rishaad: it has been quite a wild ride on the bond market, hasn't it?

some of those moves have been inexplicable, haven't they? chris: yes. in the bond market what we have seen the past week is pretty interesting. investors are really diving back in. we had international fund flow figures to show. investors jumped into high yield bond fund's on a net basis for the first time since back in january. intove seen record inflows u.s. treasuries. essentially, investors are deciding, with stock market volatility coming off a bit, concerns of a trade war coming off of it, now is a time to come back in. bond issuers are noticing that as well. issuance thisof week in asia. last week we only saw two deals

in the dollar bond market. as of yesterday, there were 16. everyone is rushing to sell. at the moment, with yields not surging, with spreads coming in a little bit, things look a lot better than they did just a few weeks ago. singapore becoming the latest bank to tighten central policy, it is its own unique way with the exchange rate. does it have an impact on financial markets, in your view? this is another reminder central banks are winding back stimulus. singapore is perhaps uniquely keyed into the global economy. their gdp tends to reflect the latest moves in both global growth and global trade volumes.

singapore is a great bellwether for how the global economy is doing. effectively they are moving to tighten a little bit, seeing as the scope of the singapore dollar exchange rate could steepen a bit. this is a reminder that central banks around the world are winding back some of the stimulus of past years. there is another release that was interesting this morning. the australian central bank put out their financial stability report. they think markets are underpricing risk. in an environment in which we have a central banks taking back the european central bank is scheduled to do so toward the end of this year, keep in mind that every quarter, the start of every quarter, the federal reserve is it shanking it allen sheet that little bit more. balance sheet a little bit more. it will pose a big task.

rishaad: thank you. you can follow more on that story and the day's trading on our markets live blog. it is on the terminal at mliv . get a rundown in a single click. there is analysis from our expert editors. you can find out how your money is behaving. hour, a craftys plan for china. we take you inside the brewery, and speak to the man in charge. are we in for a crude shock? opec says the tighter oil market dropping to the lowest in the year. this is bloomberg. ♪

♪ we are back, this is

bloomberg markets in hong kong. i am rishaad salamat. haidi: i am haidi lun in sydney. let's have a look how oil has been trading. we saw wti in new york at its highest in three years on reports escalating tensions in the you -- in the middle east would disrupt supply. richard had the monthly report out of opec saying it fell to the lowest in the year last month. it reduced supply out of venezuela and saudi arabia. our reporter talked to the opec general himself at the international energy forum in new delhi. what did you hear? good morning, haidi. opec is no stranger to geopolitical tensions and what it could mean for the price, but the opec secretary general definitely saying they are looking into these tensions with keen interest, monitoring it. they are worried about what this

can mean for the price. take a listen. we see a geopolitical premium reemerging area the good news is, the process of eating the market to restore sellers is continuing with the renewed momentum. the numbers are looking even more and more positive. mohammad barkindo speaking exclusively to us from the imf. goldman saying these tensions are aggravating already tightening markets. opec said yesterday in their report, they see a tightening in the oil market and they are pushing up their crude price target closer to the three-month forecast of it he 2.5.

it'll be interesting the next few weeks in terms of what we are seeing. we have geopolitical tensions on top of saudi arabia, venezuela, even libya. oil output dropping. return to the old fear factors, ignoring fundamentals. are we any closer to knowing if the oil market has stabilized, or is it anywhere close to equilibrium, as has been promised for a while? annmarie: this opec report yesterday shed a lot of light on what this deal has done to the market. the fact that not only have they seen this glut deepen and drip out, this glut is nearly over. the fact you have countries like venezuela and saudi producing less, it has become tighter. they are closer to the goal of reaching a deal.

the leaders had signaled they could extend to 2019. a full deal, not maintaining cooperation in the oil market. the next week we have a meeting and saudi arabia. very interesting what this group says. we have both things happening. production lessening from the opec group, on top of geopolitical risk, making the market even tighter. haidi: thank you, in new delhi for us. coming up, the world's biggest online travel site not concerned about tensions between washington and beijing. we hear from their cfo, next. this is bloomberg. ♪

♪ this is bloomberg markets: asia markets asia. i am haidi lun in sydney. rishaad: i am rishaad salamat it

in hong kong. makingirman of qualcomm progress in lining up funding to take the chipmaker private. companys --n of the company's founder. this is failing a hostile acquisition attempt by rival chipmaker broadcom. haidi: about one week to revive or abandon its foray into south korea. consumer taste, gm has until next friday to submit a turnaround plan to the government. the company is seeking concessions from the union and has threatened to file for bankruptcy if it does not get what it wants. gm has already left europe, india and russia. rishaad: expects to win china's approval for the electric version by the end of the month.

final certification of the plane is seen as imminent. signed off by chinese regulators this week. approval had been anticipated last year, but it was held up as china thought recognition as a -- in aviation certifying authority in europe. haidi: possible retaliation is by limiting chinese corporates in the u.s., but leading online travel agency ctrip says it does not have a impact on their business. the cfo cindy xiaofan wang says international expansion is our top priority for 2019. cindy: first off, they have very good brand awareness in the mid-to higher and range of the market. now and more customers are frequent individual

traveler products. saw it didstory you not have a meaningful impact on ctrip as a whole. >> are you seeing meaningful decline in bookings to the united states? cindy: not yet. because we have a pretty large market share in china, it is in the mid to high end. in the last couple years, anbang travel has become the key driving force. producthave found, the that we placed outside of china not only can serve the chinese domestic traveler, but also can serve [indiscernible] ago, we started to pass the markets outside of china.

we already got initial success in the hong kong market or china market. international business going forward will become one of our key driving forces. >> is there more m&a on the horizon for you, international? cindy: not necessarily just in &a. day -- m we will grow this brand together. cfo cindy xiaofan wang speaking to stephen engle. breaking news out of china, these are dollar numbers when it comes to trade data. not much, but for the entire first quarter, u.s. imports to year,rising 8.9%, year on in dollar terms. exports rising 14.8% in dollar terms. we will try to get a breakdown

in terms of the easing back when it comes to exports. a huge number in february, remember. we will go through trade numbers with the china economist. ♪

♪ it is 10:20 >> >> nine in hong kong, 12:29 in sydney. singapore changing its stands for the first time in years. changedtary authority the scope slightly from 0%, signaling policymakers would try a stronger local dollar. 4.3% data shows gdp grew in the third quarter from a year ago. u.s. commerce secretary wilbur ross told the summit of the americas his country will not give away leadership in the region. he also said corruption cannot be tolerated, and nations must

create enforcement mechanisms to fight graft. he said trade barriers in latin america are necessarily severe, but the u.s. intends to help simplify the system. says he isest planning the feasibility of a natural gas pipeline across australia, to diversify away from iron ore. west coastuld link and east coast cities. 5e transcontinental pipeline, billion australian dollars. >> that is a project i believe will be done in two years. creating a huge new source of energy into markets which are desperate for resources for energy. >> china's military strength growing. state media says the fleet consisted of 48 ships, including the aircraft carrier, along with

helicopters, fighter planes and 10,000 personnel. it is the largest naval review since 1949. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. i am paul allen. this is bloomberg. ♪ rishaad: let's have a look at market angst and see if that feel-good feeling is still there. >> the feel-good feeling seems to be intact. the nikkei 225 adding 0.5%. the first weekly gain as a close up the morning session. weaker,thing looking led by the offshore renminbi and taiwanese dollar. 128hore yuan above the handle. one highlight was the 14.8 present increase in dollar terms to the united states. when it comes to the outlook for the second quarter, chinese

customs officials saying rising lcertainties and pressures do o china's growtho outlook coming through from the pbocm. . forecasty raise the for beijing. let's take a closer look at stock movers in tokyo ahead of the trump-abe summit next week. on the opposite end of the hino motors doing the worst. they are to join forces with volkswagen when it comes to easy and self driving technology. in seoul, hyundai elevator rising. they tended to rise when there are prospects for more inter-korea participation. we are anticipating talks with seoul and pyeongchang.

rishaad: we do not have a march numbers yet, but when we look at have chinas, we first quarter imports to the u.s., rose 14.8%. 8.9% on the import side for the first quarter. i can say that is year on year in dollar terms. a lot of this made more complicated by currencies. let's bring in jpmorgan's chief china economist. what are you making of this, generally speaking? globalink the environment is quite positive in terms of the demand trend. first quarter numbers on the trade side in china typically tend to be quite volatile because of the timing of the lunar new year. you are seeing the first two months of the year, very strong exports and imports. have a detailed march number yet, but it is likely

there is some payback with the first quarter on the side. the firstear on year, quarter, up 13%. that is overall trade. we have a yuan appreciating by 8% or 9% in this time frame. how does that play out? grace: what is most important is demand conditions. the we have seen since second half of last year from a global perspective is strong demand generally on. -- generally on capex. one issue is the short-term demand conditions on the global side. global demand is one of synchronized growth, a supportive environment. in the short-term, retail capex has slowed a little bit. that might mean near-term strength.

you might see more impact of u.s.-china trade tensions to affect china's export growth. rishaad: we have seen some evidence from the wto this is having affect on investment decisions. it is making people think twice. that is the danger, isn't it? grace: that is very true. we are talking about not just trade, but investment. the part of trade that is related to export activity down the road. what we have seen in the past two years, on the investment side [indiscernible] what we are expecting going into 2018, we do look for manufacturing investment in china overall. rishaad: [indiscernible] grace: what we are expecting for the manufacturing investment part of the economy will gradually be recovering on the side of improving fundamentals.

if there is increasing uncertainty on the demand side because of trade tensions, you might have some drag on recovery for the manufacturing part of investment. how is the deleveraging campaign playing out? grace: if you look at the number, you do have decent progress in terms of deleveraging. your off-balance-sheet lending activity and interbank financial activity has been slowing noticeably overall. whereas, at the same time, your real economy has been doing well. in that sense, it is a benign deleveraging we have seen so far. year,into the rest of the the question is, how will this scenario play out further? what we are seeing, the total financing, representing the overall credit growth in the system, might slow somewhat

further in this year. that could potentially affect [indiscernible] sector, thosee areas you might see somewhat slower growth overall. developers,rty clearly one of the ones in the limelight. how much pain does a sector like that put up with in the coming months? oft could be the real test how serious beijing is about the deleveraging campaign. grace: that is true. so far what we have seen in terms of numbers, your real asset investment number is stronger than expected in the first two months. at the same time, you see transaction. value and volume growing -- transaction value and volume growing. some smaller ones could face stress down the road. potential he you could see your

real asset investment growing youwhat -- potentially could see your real asset investment growing somewhat. or buying from the weaker development -- developers, overall. haidi: is a government priority in beijing to boost domestic activity, innovation and growth in general -- do you think they have gotten to a point where a low-level trade war with the u.s. would not hurt china because they have the strong domestic growth story? grace: indeed. our sense has always been the trade tensions with the u.s. so far in terms of the announced the impact on the macro perspective in terms of gdp growth is rather manageable and limited. at the same time, given what you have seen over the past year,

the growth number came to surprise on the upside in 2017. quite likely will be holding up rather well in the first quarter of the year. i think the strong likelihood is that china will be more likely to beat the government growth target for the year of 6.5%. investment, i think that is a concern of trade tension. would likely mean there is even more policy focus on rebalancing the economy and supporting the domestic side, including new growth sectors, consumption and service sectors. inhaad: i was interested your research, the list of tariffs being applied. we have been talking about this, aimed at made in china 2025. what you delve in is more than just trade, it is about stopping china catching up. is that the central point you are making? grace: exactly.

it is purely us trade issue -- a trade issue. china has had problems trading with the u.s., especially in the countries, the two we got to intellectual property and rights. they almost came to the point where the u.s. threatened tariffs and china threatened with retaliatory measures. those ended at the last minute when the two sides came out with agreement and those tariffs were never implemented. we thought that was an interesting comparison now. the difference, while the past scenarios were [indiscernible] this time, it is not just trade. sectors,es strategic with regard to 2025.

we do think the path to negotiation is a bumpy one. it would likely take quite some time for each side to focus not just on trade, but issues as technologically -- technological transfers. it would create uncertainty in the economy. rishaad: it was interesting, xi jinping's speech at the boao forum. he talked about the need for globalization, building china as a champion of globalization. and the need to open up -- if you open up, you open up, you're not fully globalized, are you? grace: china is still pushing strongly for globalization. they canas long as import, the export side will not be as free. let's put it that way. grace: i would not completely agree. on the export side, what china is aiming for, moving up the

manufacturing level, not necessarily pushing for strong growth, 30%, but improving the mix. at the same time, when you are trying to rebalance your economy and upgrade your economic structure, opening up, with regard to the service sector, where there is much to learn. rishaad: where will we be in 2025? will china be the largest economy in the world? some say they already are. grace: our fundamental sense is, china will go down the path of continuing rebalancing and moving up the manufacturing ladder. trade tensions could mean the path to achieve that aim [indiscernible]

another, china will go down that path. in that sense, the more serious impact would be to slow down that progress, but the direction is there. jpmorgan,race ng from senior economist. you can interact with charts we use using gtv . browse through them, catch up on key analysis, and saved charts for future reference. that is gtv . this is bloomberg. ♪

♪ you are back with bloomberg markets in hong kong. i am a shuttle and -- i am rishaad salamat. haidi: the korean government

considering removing samsung, after a pie out -- after payout removed market peter, what exactly happenedcap. ? removed- after a payout market cap. peter, what happened? peter: it would have been a couple million dollars to get into their employees program. one, itof putting in was 1000 shares for stocks that they owned. that basically meant on friday, 2.83 billion shares were distributed to its employees. if that was it, i think it would have been fine, because these

were all of fake shares. unfortunately, within that 37 minute gap where the company error, for 16 employees, sold those shares on the market. 16 shares. i think it was 5 million shares or $1900 million won, million. that royal to the market. -- roiled the market. the biggest drop since the financial crisis in 2007. businessd the overall transactions. the fallout has been amazing. there is quite a large contingent of individual investors that account for 70% of the stock market here. they have been up in arms.

just within days, more than 200,000 signed a petition to the south korean government, asking for banning of shortselling. although this was not really related to shortselling, there is a fear that people, the regulations and way the transactions are conducted is too loose. the repercussions have been significant. haidi: it is just an amazing story. what are we likely to see in terms of regulatory reaction, given there has been this backlash? peter: first of all, they are investigating this to be sure what kind of transaction safeguards were in place. they are deeply investigating samsung's security. already, the largest pension fund, the world third-largest pension fund, has stopped trading with samsung securities.

samsung securities is also compensating all those shareholders who lost money when the shares dipped on friday as a result of this blunder. all kinds of reviews are being conducted, particularly on shortselling. there is a concept called naked shortselling, which is illegal in south korea, but there is a fear people are doing that. essentially, selling fake shares with the hope of buying them back when those share prices fall. re-examination of the way the stock market is conducted. much, peter, thank you so our bureau chief with an amazing story. drinks giant is carving out a slice of asia in a growing segment of the market. this is bloomberg. ♪

♪ you are back with bloomberg markets. i am rishaad salamat in hong kong. haidi: i am haidi lun in sydney. china now home to one of the biggest burress, ab inbev looking to carve out market share in a fast growing sector. we spoke exclusively to the man driving the company's regional push.

>> when you start off a from a small base, when you talk in china, our total beer market is around 150 million -- 150 million barrels. although the beer market has been quite stagnant, the different number of beers are taking a lot of space. when you are a small base, it is difficult to get to 100%. >> do have a target in terms of where you want to be five years down the line, 10 years, in terms of market share+ -- share? >> we created the challenge of having 10,000 venues in china. and thousands of locations in china consistently pouring 10 different beers. >> when do you expect to be turning a decent profit? >> what i said earlier, when you are a small craft brewer, prices in china are robust.

you have great beers available -- ahree renminbi of can. can. andare using way more hops, expensive component of beer, margins get lower. how do you balance this equation? you need to sell more beer. has to scaleuct with of the volumes of the garden. oneave been able to acquire that allows us to charge between 12 to 18 renminbi in the supermarket, 40 to 50 renminbi in the restaurant or bar. bar, at this price level, it works. >> how was the craft beer sector? >> it is so big, it is open for anyone.

probably the most competitive market i have ever seen for the lagstream longer -- betweeners. mainstream lagers. beers are doing a lot in china, pale ales. there is a lot of space. >> what do you say to independent brewers who say the likes of ab inbev are a threat to craft beer? >> there is much more room for us to work together, fostering beer in china, showing how great beer can be, than to think about competing with one another. it is not about anyone threatening anyone. it is much more, how do we work together to make this market vibrant? there is so much space to grow. to put your products in their --

there. space, i have a hard time why anyone would be concerned at this stage. chiefd: he is ab inbev's executive for beers. now, -- david will take you through the next hour. nd ends in p. >> [laughter] tpp, there are questions whether donald trump was serious about that. rishaad: a few weeks ago he was looking at it again. it is supporting that narrative. >> is he doing it because he sees economic value, or is a signal to china? the 11 remaining tpp numbers

would be happy with it? he would have to renegotiate the whole thing. rishaad: they put all the lures for the u.s. into another basket to encourage them to come back in? david: yes. it, for allashed intents and purposes, in the campaign. we talk about what it means for china, that relationship. joining us.nn this is bloomberg. ♪

♪ mark: i am mark crumpton in new york, you are watching bloomberg technology. white house press secretary sarah huckabee sanders says no final decision has been made on how to respond to that alleged gas attack in syria. sanders says officials are continuing to assess the intelligence and are engaged in talks with u.s. allies. president trump spoke to british prime minister theresa may and french president emmanuel macron today to discuss the situation. meantime, the rush to move biological samples out of syria after the attack may have yielded results. nbc reports urine and blood from bodies in