tv Bloomberg Daybreak Asia Bloomberg March 14, 2021 7:00pm-9:00pm EDT
oh, good one. move your xfinity services without breaking a sweat. xfinity makes moving easy. go online to transfer your services in about a minute. get started today. haidi: a very good morning. i'm haidi stroud-watts in sydney. we are counting down to asia's major market opens. shery: i'm shery ahn in new york. vaccination fears grow as astrazeneca jabs are halted on blood clotting reports. new south wales finds the new infection puts hundreds and quarantine. asian markets face the heat from
bond yields ahead of this week's key fed meeting. the dollar is mixed while oil faces renewed pressure. bitcoins dramatic surge continues with the original crypto coin briefly topping $60,000. bitcoin traded for just a few cents a decade ago. haidi: taking a look at markets, we are seeing a pretty decent start to the trading day when it comes to australia and new zealand. we are on track for a fifth straight day of gains, the longest winning streak in two months time. australian markets in sydney are coming online in that staggered open. not much action there. pretty flat. we are watching some of the oil majors as well as the miners given we are expecting a day-to-day louche out of china today. we are looking ahead to some rolling growth numbers when it comes to industrial production. as well as retail sales and new home numbers due out over the next couple of hours to support
that gdp targeted about 6% that we had from the national people's congress last week. taking a look at the start of trading in japan going into the bank of japan. futures up by .1% and u.s. futures up by .1% when it comes to trading at the moment going into a week where we are expecting a fine-tuned comment -- commentary from jay powell going into the meeting as we would seek to try and keep treasury markets as well as global bond markets under control, shery. shery: markets of course, a little bit more encouraged on the vaccination efforts around the world, but they are facing some major hurdles, especially with astrazeneca trying to reassure people that the vaccine is safe on my -- safe amid blood clotting fears. astrazeneca saying it is safe but sun country is starting to take action. qian: you can add the
netherlands to that list. -- >> you can add the netherlands about this. there's been a handful of blood clot incidents possibly around the astrazeneca vaccine from austria, to norway, to thailand, and countries are acting quickly. it plays into some of the overall concerns about these very new vaccines and whether it's blood clots or people dying randomly, whether they are safe or not. the european medical regulators have said there is no issue. astrazeneca said 17 million people received their shots so far so any instance of blood clotting or similar ailments is less for the population at random. it's high-profile going into the work week and it may take a few days to really find out is there anything to this or not? meanwhile at the same time,
astrazeneca is falling short on its commitments for the number of shots it's delivering to the e.u. and the u.s., which has a small stockpile of astrazeneca vaccines -- it's not offering to give any of its supplies away either. all in all, that accepted major e.u. countries being significantly behind on vaccinations compared to israel, the u.k., or the u.s., at a time when the coronavirus case rates are creeping up again, so it's a worry. shery: you mentioned the u.s. we heard from president biden saying he wants all american adults to be eligible for the vaccine by may 1. is a reluctance to take the vaccine going to be an issue though? >> it's very interesting. and you know, the vaccine -- the whole response to coronavirus in
the u.s., as you know, has been highly politicized. on almost any measure you could look at, you know, is coronavirus real? should i take the vaccine? the difference between democrats and republicans is very stark. in some states, you know, whether it's wyoming or mississippi, sery heavily republican states, it can really have an impact on how quickly or whether you reach herd immunity, in particular communities. the data points that anthony fauci was posting on today is a survey that shows 49% of republican leaning men say they don't want to take the vaccine. he says he thinks once vaccines have become more available, they become a reality. ok, i will give it a go.
very interesting, trump has so much of an impact that he could be a big game changer if he comes out with a pro vaccine message. certainly, the u.s. has done fairly well on its vaccination program. 106 million doses so far. it was a slightly slow start. with vaccines available now, seems like it is kicking in towards joe biden's goal. >> 107 million doses in the u.s. according to our vaccine tracker. our deputy managing editor, ros krasny, with the latest. in hong kong, authorities knocked down more residential areas and send hundreds into
quarantine to contain the latest virus outbreak. stephen engle joins us now from hong kong. we are hearing about the amount of people being sent into quarantine including groups of infants being involved. stephen: that's right. about 750 people having close contact with these 109 people who have now been confirmed to have caught the coronavirus, tied to this in the western part of hong kong island near -- 109 people confirmed as of last night. the government is saying that. " are now in quarantine. at -- close contacts are now in quarantine. infants have been sent to quarantine, aged between 11 months to 18 months, along with their caregivers. those children attended a muted
playgroup where one of the parents was later to have been confirmed to have caught the virus. 24 new cases in total yesterday here in hong kong, but 10 of those 24 were tied to that outbreak. we are getting compulsory testing as well at 90 residential locations and 60 additional worksites. seven schools have been closed and we have also had significant lockdowns and parts of mid-levels here in central and western hong kong island. two more residential blocks and buildings have been ordered to lock down late last night on top of four in the mid-levels on saturday night. shery: what about the vaccination drive? how is that going? stephen: it is having some fits and starts. the food and health secretary, in her blog post last night, had more details on that as well as reports of six deaths involving
people who took the sinovac vaccine. the government is saying that they cannot tie vaccinations to those deaths but still, people have been hesitant and the number of people that have signed up the inoculation with sinovac, 100 50,000 people or thereabouts have taken the vaccinations from china. however, the no-show rate has risen to about 30%. as sophia chan did say, is understandable. there would be some hesitation but into her blog posts, she's trying to clarify that there is no link between the sinovac vaccine and those reported deaths. i want to make one more note about the sinovac vaccination. we are learning that china is saying it will ease visa requirements and the paperwork for foreigners who want to go
into china from hong kong if they have proved they had taken a vaccination from one of the chinese suppliers. shery: stephen engle joining us from hong kong with the latest on the virus infections there. let's get to vonnie quinn with the first word headlines. vonnie: sydney reporting its first local covert case in almost eight weeks after a hotel quarantine worker tested positive. he had received the first of two doses of the pfizer vaccine. new south wales said it's too early to know if it will hinder plans to ease restrictions this week. falling grain demand from china by targeting saudi arabia. for the first time in five years, australian exporters have broken into the saudi market. australian grain suppliers seem likely -- tons of orders this
year. the military leaders of myanmar have imposed martial law after security forces killed more protesters across the country. beijing asked for better protection of chinese owned businesses with several outlets coming under attack over the weekend. they can use the army to maintain order. angela merkel has suffered her worst election defeat for two state polls. they say the party fell four points to 23% compared to 2016. they are consolidating their hold on power. voters have been able to express a view on merkel's virus strategy. global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries.
i am vonnie quinn. this is bloomberg. >> coming up on "daybreak asia," we take a look ahead at a busy week in american diplomacy. the highest level in person talks with china plus visits to south korea and japan. our guest joins us to discuss geopolitics this hour. we will be speaking to a coo and chief investment strategist for her top picks in the market today. plus the biden administration pumping money into the pandemic relief and the economy. this is bloomberg. ♪
we have concerns about inflation , rising yields, so what are we expecting from the fed? >> they are meeting against a changed backdrop from the last meeting. viruses are coming down in the united states. gdp growth forecast for the year up to about 7% in some cases. inflation expected to start accelerating. top 2%, even if it is temporary, that is what is on the plate. secretary yellen was on the shows, repeating the statement she has made over and over. there may be more inflation, but the fed can handle it. >> is there a risk of inflation? i think there is a small risk and i think it is manageable. i do not think it is a significant risk, and if it materializes, we will monitor for it but we have tools to address it. >> once again, larry summers is disagreeing. he says inflation will
accelerate and it's going to cause the fed to move sooner than people thought, more in line with what the markets are looking for. let's look at the great statement he had about the stimulus, why it is too much. larry summers likens it to pouring water. if you put too much water in the bathtub, it starts to overflow. we are trying to pour too much water in. markets are waiting to see who the fed -- jay powell and his colleagues -- will they signal that they are ready to do something on bond purchases. economists surveyed by bloomberg expect the fed to raise rates twice in 2023 and of course, the fed's dot plot shows that this will begin to happen. markets are already pricing rate hikes now into the end of 2022. this is one of the three things people are waiting to learn from
everything jay powell says, from what the dot plots show. it's going to be an interesting meeting and one that will move markets. >> the boj could be an interesting meeting because we are no we are looking ahead to potentially them tweaking the yield curve control but are they also actually possibly considering the move to the rate as well? >> they have wrapped up their policy review. they do it every five years. what people are looking at our three -- are three key items. when it comes to purchasing etf's, they are going to link more closely the number of etf they buy to what the market moves are. in other words, if the stock market is hitting new highs, let's don't buy etf's for a wild but not back away from it entirely. keep it as a tool in the quiver. in terms of yield curve control, they are expected to widen the bond trading band or implicitly signal they will be doing it, if not at this meeting, may be the
next meeting, from 40 basis points. 20 basis points for the 10 year jgb to six year basis points. gold curve control, the creation of this dates back to their 2016 review. another reason why people are looking for some if and changes. and finally, the deputy governor , when he spoke monday before last, he said that the market has this idea that the boj is out of ammo. the idea is they are going to look at the efficacy of -0.1 negative rates. they tell us it has worked, it has had the impact, and they can do more of it. it's not that they will signal they will cut back key rates from negative to more negative but it is still a viable tool. in other words, they want to make sure their policies are sustainable for the long run. some i spoke to recently in tokyo, from alliancebernstein,
it's not a sprint. it's a long-term marathon. that's what they will do for these tools. that's what this struggle is about for them. >> from negative to more negative. a controversial policy move. kathleen hays with the latest. let's get more on what to expect from central-bank this week. we are joined by the ceo and chief investment strategist. great to have you with us. what are you watching today? >> what we are seeing is the stimulus. there are confounding effects, opposite effects, but we are expecting in the short-term that we are going to see a cash infusion in the market coming from retail investors. retail investors are receiving their checks. as we saw last year, this time, that coincided with a significant increase in the markets so we think they are going to crowd the popular names
so we will see that rock markets are going up in the next few weeks, especially in tech, health care, and adr, but we have to remember that on the other side, with the stimulus, we have inflationary fears. we know that institutional investors are hypersensitive to any modest increase in interest rates. with the stimulus now offering a cash infusion into the economy, on top of it, on top of an already recovering economy, that will add into inflationary fears. haidi: you say that tech will come roaring back. is that from longer-term investors? where does the retail frenzy end , particularly if you are linking it to the stimulus checks? when it runs out, what happens? do we continue to see retail pressure on the markets? eva: the argument here is that
if we look at value -- so a previous overreaction to growth sticks to an overreaction to value and what we are seeing is specific value stocks are trading at an all-time high. if we look at this, it's trading at an all-time high even though last year, the revenue decreased by 40%. they have piles of debt. they have competition with uber, lyft, and others. we are not going back to pre-pandemic levels. when it comes to the hospitality industry, again, we have marek international trading at an all-time high even though last year, the revenue dropped by 50%. most of the hotels are closed. they have competition with airbnb and other players. there are no fundamentals to support the high valuations of some value stocks.
if growth stocks can drop 50% like we saw in the past week, what can happen with value stocks is that they can drop up to 100% if they file for bankruptcy like we saw back in the summer. >> does that mean that perhaps these financials are overbought at this point? we saw the index gaining 25% year-to-date already and this coming at a time when of course yields are rising so is that it? do we have to veer away from these names that have come as you say, perhaps been to stretched -- too stretched? where would you go? eva: we see inflationary fears. we have two areas we are focused on. traditionally, financial have been able to pass along their costs associated with interest rate increases by increasing
their own rates. when it comes to syntax, in particular, they can increase your margins by leveraging technology and innovations to cut down costs and make their business models more efficient. now, when it comes to health care, biotechnology, health care is also an industry that they can pass along the costs associated with interest rates rising. as someone who needs insulin, they will buy it no matter the cost. we have inelastic demand when it comes to health care. when it comes to biotech, you have technology and entrepreneurial innovation, which can make your business model more efficient, your operations more cost-efficient, and that will help you push the costs related to the increase. >> that sounds to me like a play on demographics. what are some of the somatic
plays you are putting into your portfolio? >> we are very focused on biotechnology. and in particular, economics. the pandemic put a spotlight on biotechnology and we are seeing that the global market size, when it comes to genomics is going to reach 80 billion dollars by 2027 and when it comes to the population, we now have aging population in china and that puts extra pressure on coming up with new innovations, so we have seen already a tremendous shift out of traditional treatments and medicine into new age technologies. that has pushed prices down when it comes to, for example, sequencing a genome. now, that's hundreds of dollars. the amount of time for research has also dropped from 10 years to 15 years so we see great potential when it comes to jnana
>> a quick check of the latest business flash headlines this hour. bitcoin powered through $60,000 of stimulus fueled rally in the past few months on speculation. bitcoin has surged over the past year, lifted in part from support by elon musk and some in the corporate world. the digital coin traded for just a few cents and has gained more than 1000% in the last 12 months. two of australia's largest pension funds are a step closer. the government in queensland is supporting the proposal with the
>> this is daybreak: asia. astrazeneca essence its vaccine is safe despite more countries banning the vaccine. the company says careful review of the data shows no evidence of increased risk of pulmonary embolism. at least 30 countries have halted vaccinations. 17 million people have been given the jab in the u.k. in europe. janet yellen is downplaying the rest of inflation, saying the
threat is minimal despite the massive relief program. minimal but manageable with only temporary movement in prices. a survey of economists say hiking rates in 2023 will not be forecast this week. police a monitor under fire after arresting mourners. officers moved in after hundreds of people gathered at an unofficial memorial. a police officer has been charged with her objection and murder. the metropolitan police service as the mourners were breaching restrictions. china is to report data in the coming hours with analysts expecting strong growth in january and february. the figures will be based from storage reports from one year ago. that is your bloomberg first word news. haidi: let's turn to the latest
on these diplomatic engagements this week. the u.s. kicking off a another round in asia, antony blinken and national security advisor's will meet their chinese counterparts in alaska on march 18, the highest level in person exchange since president biden took office. that meeting will take place after a speech to allies. let's bring in an asian program director. always great having you with us. we also have that meeting with australia, india and japan, that seems to talk more about broad cooperation instead of a more targeted anti-china approach. is that a reflection of what we will be seeing this week? guest: i think what we are seeing is reflection of a more systematic approach by washington and its conduct and foreign policy, certainly towards the indo pacific region.
that is to put allies and partnerships first, to speak from a position of strength relative to china, and where possible, to offer tangible results in action in the face of an immediate crisis such as the pandemic and pandemic recovery. this vaccine diplomacy issue by the united states, by japan and india and australia speaks to the origins of what first emerged in 2014 the wake of the tsunami crisis. at that point, the four navies helped with humanitarian relief in the region. this speaks to the idea that the quad could be more than just a military convoy to china. delivering public tangible goods to the region. haidi: what does that say, we will have administration officials going to japan and south korea before a meeting
with their chinese counterparts? guest: i think it is very important to the new biden administration. blinken in particular will be in tokyo. along with the secretary of defense austin, and they will be speaking to their counterparts, the message will be one of reassurance, in listening mode, where they will try also i think in anticipation of a restructuring of posture, towards one of greater dispersal of its assets across the region, which may actually move some of the military forces, assets out of japan and south korea towards southeast asia. there will be a mission to try and assuage japan and south korea that the u.s. is still very much committed to the alliance, and this is just the newest iteration in trying to
create an effective military counterbalance to china's increasingly assertive role in places not at the chinese see. haidi: would it be fair to characterize the biden administration's approach to china as one that is less volatile than under president trump, but ultimately, substantial blue just -- substantially applying even more pressure on beijing? guest: that's right. i think beijing have to be quite wary of this, because in many ways, one of the hoax was for a comprehensive reset. they are not, however, going to get from the biden administration a return to the status quote -- status quo.
in fact, antony blinken has been very clear that the forthcoming meeting will not be part of a strategic dialogue. they will not expects tangible outcomes out of this. instead, that the u.s. is very committed to pursuing competition with china, but in a smarter, more systematic manner. less at, less transactional than the trump administration. putting partnerships and alliances first. it represents an even more formidable threat in many ways to china's position in asia that came out of the trump administration. if china had hoped for a comprehensive reset, that is unlikely to be forthcoming out of this meeting in anchorage, quite to the contrary, i think this is the u.s. lang out its basic principles -- u.s. laying out its basic principles, and
competition will be the name of the game, but they will do it in a far more astute matter. haidi: the re-pivot towards asia under the biden administration. what does that mean for mental powers? i am thinking specifically -- is there any hope for a diplomatic research -- diplomatic research -- diplomatic reset, or isn't australia on a predetermined path for how it deals with beijing. guest: i think i'll has taken a very patient approach -- australia has taken a very patient approach towards china. they have encountered china's ire in terms of retaliation in the form of economic sanctions for measures taken in australia, including the call for an investigation, an independent investigation into the origins and handling of the covid pandemic, as well as other measures in relation to the 5g
market and trying to bolster our cyber sovereignty. however, australia will be trying to where it can play a pragmatic role in the region and towards china, and also where it can, to illustrate it has an independent foreign policy. its participation in initiatives like the quadrilateral dialogue are less to do with its conventional u.s. alliance and more to do with its investments in not ally partnerships, including with japan, india and beyond the quad, also with indonesia and south asian countries including vietnam. it is a sort of three-dimensional foreign policy, one that hopes to get the best possible relationship with china, but at the same time investing in diversifying relations, not just trade relations but strategic partnerships with other it'll powers in the region, while at the same time trying to keep the u.s. as involved as they can be.
shery: on that note, we have seen the u.s. be pretty active when it comes to the deteriorating situation in myanmar. how big of an opportunity is that for the u.s. to actually work with china on some more pragmatic issues? guest: apart from the pandemic, emaar is also a very pressing priority for the region. it is very and escalating concerning an escalating crisis. the u.s. and china are at a loss for what to do, but have also been reticent to get involved, partly because it is not clear whether the military will triumph. at the very least, the international community needs to be prepared for a range of scenarios. i think there is a very real potential window of opportunity, a rare one, for some degree of
consensus between the u.s. and china for trying to get the sides back to the negotiation table and deliver the most peaceful negotiation -- peaceful process. they have been very ineffective because they have not had china's participation. i am not expecting china to start sanctioning myanmar, but we could possibly expect china to pressure the military. they have those levers of influence, they have those channels of communication. what is required from the international community is to try and build a consensus on ways forward, it is an escalating crisis, things can get far worse. the longer it last the more geopolitically driven it may become. it is a case of acting now to try and offset the worst possible situation. this has to be on the mind of both beijing and washington.
at the moment, i think the reticence on both ends to try and work together on this shared concern. haidi: always great to have you with us. we are also on the watch for keycode data out of china, industrial production, retail sales as well as new home prices all coming across on bloomberg over the next couple of hours. bloomberg subscribers can go live to get analysis and reaction from our expert editors. this is bloomberg. ♪
shery: we are seeing u.s. futures gaining ground. we had a little bit of armed volatility, to watch out for that. the asx 200 at the moment losing 2/10 of 1%. we do have the governor speaking right now, to watch out for what he says. nikkei futures pointing higher. the japanese yen the following 29-month flows. the japanese yen at the moment holding steady, but do watch out for that weakness, already past that 109 level. staying in japan, here are some stories we are watching today. a new team is helping focus on
public and private companies raising cash. the structured finance and solutions group has about 20 people and will start operating on april 1. on the vaccination front, a report that japan expects to secure about 100 million doses by the end of june. data from bloomberg's vaccine tracker showing that the country has administered over 200 and 30,000 vaccine. -- 230,000 vaccine so far. the head of the international olympic committee has to send and offered to buy covid vaccines from china for athletes and officials at the upcoming games. this after the announcement drew criticism by human rights activists. haidi: we are going to stay with the tokyo olympics. the newspaper reporting that games organizers will consider getting an upper limit of 50% capacity in venues if the events does go ahead. a decision is due in the next week or so. our politics reporter joins us now. what are we hearing when it
comes to these measures that japan is trying to take to try and make let is going to be, if it goes ahead, a highly unusual olympic games safe? reporter: we only have 10 days to go until be a torch relay begins. once we reach that point, it may be a point of no return where we can't really see a cancellation or further postponement. as you say, we are beginning to see some leaked reports of measures that will be in place to try and keep it safe during the pandemic. obviously, we have a few months until july. looking at tokyo, we are still under a state of emergency due to the virus, that is due to end this weekend. we do not know for certain how bad the virus will be in tokyo at that point. the latest on the number of spectators is that it will be limited to a maximum of 50% of the capacity of venues, but he could be even less than that, depending on the virus
situation. a decision on that is expected in april. we have seen reports that spectators will not be allowed in from overseas. given that the rate of covid-19 in japan is still a lot lower than in a lot of other countries, this may go some way towards assuaging the fears of the public with polls showing that most people really don't want the olympics held in tokyo this year as planned. shery: there are some any people involved with such a massive event, right? athletes, coaches, staff. will be vaccinated by the time the event starts? reporter: it's pretty clear i think that most people in japan probably won't be vaccinated by that point. it is a little bit up in the air , there are expected to be more doses of vaccines shipped in in the period up to the end of june. getting those into people's arms by july the 23rd is going to be a pretty tough task.
one of the major developments has been china stepping forward to offer its vaccines to athletes and officials in those countries that have approved the chinese vaccine. japan is not among those countries, and the japanese at minister is already reporting to have said it will not allow athletes to be inoculated with the chinese vaccine, and it has not approved the chinese vaccine. shery: our politics reporter joining us from tokyo. let's turn to one vaccine maker, novavax saying it is post for applied after the shot had a 90% efficacy rate in trials. bloomberg spoke to the ceo about where it is likely to be rolled out first. guest: is the u.k., we expect that will be our first filing. we did the phase three trial there, and those are the data we announced last night, confirming
what we had seen in interim results, and expanding it to show that we prevent all severe forms. and importantly, mild moderate and severe. while on the spectrum. we are putting together data from the trial into a package, and we are doing parallel work on manufacturing, what is called the cmc side. both of those, we hope to go in for filing with the nhra, the u.k. equivalent of the fda in the second quarter. and then, it is up to the agency to determine the timing of that. >> with the usb far behind that? -- would be usb far behind that? guest: we have a trial in the u.s. going very well, 30,000 people in the u.s. but we recruited the people in six
weeks which was record-breaking. we are now team letting cases so we can determine how well the vaccine works. obviously with the u.k. data and south africa data in hand, we have a lot of confident that the u.s. trial is going to mirror those levels of data. we have to put together the same package, several weeks behind the u.k., and we will put that package together in addition to the same issues on the cmc side. reporter: one thing that stood out in your results with the lack of severe cases. it looked like 100% efficacy versus severe disease, even among some of the variants. what is working so well in that? guest: with ticket as i combination -- we think it is a combination. despite protein stimulates an immune response, and that immune
response is what blocks the ability of the virus to act -- the virus to infect. haidi: the novavax ceo. you can watch that live and catch up on our interactive tv function. you can also diving -- dive into anything we talk about. join in to send us instant messages as well. shery: more coming up after the break. this is bloomberg. ♪
haidi: we have breaking news out of japan. beating expectations, falling only 4.5%. this is a contraction after three months of expansion for machine orders which are a leading indicator of investments, given we have the state of emergency being reinstated across japan. numbers also be the growth of 1.5%, we do have external demand supporting manufacturers despite the fact that there is a little bit of discouraging news for companies on the profit side. we will be keeping a close eye on the markets when they start trading in less than 10 minutes in japan. haidi: we have exclusive reporting that goldman sachs. sources tell us high-profile departures and work from home policies are sparking angst.
there is also the frequency in which ceo david solomon is using the company jet for personal trips and his unique leadership style. our finance reporter has more on this. david solomon has been at the helm for about two years. what can you tell us about his leadership style and the culture that he has cemented at the firm? reporter: david solomon is certainly the only wall street ceo who is also a part-time dj. but that call, that image is not quite the whole picture. what our reporting shows is that underneath all of that, david solomon is very much a commercial animal, and old street while school -- wall street boss. he has cut costs, trimmed partner numbers, and has made clear his this taste of the work from home culture that we have all had to get used to. he has called it an aberration
that needs to be corrected as soon as possible. to be fair, he has been working from the goldman headquarters throughout the entire pandemic. shery: what are some of the things that perhaps have not gone as hoped? reporter: the main thing is the big-name departures. they have hurt them pretty badly, and these include investing bank buses -- bank bosses. all three of them are actually part of th team that he himself had shaped. that is not a good look. they have had other managers leave in recent months as well, that has been a cause of attention inside. shery: yet, business is going great. reporter: that is the thing. the stock is on a share, doubled over the past year.
wall street as a whole has benefited from the volatility. goldman has been no different. they posted the highest revenue and more than a decade, their market cap is up more than 40% since solomon took over. the fact that despite all of that, but we are talking about here is internal tension, and? 's over his leadership style. that is what investors are going to start to worry about as these internal rumblings grow louder, especially at a time where solomon is looking a little bit out of touch. he is talking about asking people to come back into the office as he jets off to the bahamas. haidi: our finance reporter, great story. let's get you a check of the latest headlines. china extended its crackdown on burgeoning e-commerce companies.
regulators have opposed an initial fine it is seen as targeting the company. they company is helping to great a new team. there are 20 people on the team at the moment that it will start work officially on april 1. the plan is based around on this did securities -- unlisted securities. they are looking within operations and outside to add more specialists. [indiscernible] shery: as you said, very important. one company plans to raise $2.2 billion by staring -- selling shares. in seoul as well. watch out for those connected stocks, they surged in the
quarantined. chipmakers are in the spotlight as u.s. and china meet. beijing wants to boost domestic production to lower reliance on american tech. japan and south korea coming online. we are seeing the nikkei coming higher with real estate and financials leading the gains. the japanese yen now at a nine-month low, but do watch out for the j gigi markets this week, we have to boj announcing details of its policy review. we have heard from sources saying that perhaps the boj is considering releasing an analysis of the potential impact of lowering its negative interest rates further. take a look at what korean stocks are doing at the moment, a little bit of pressure, the korean won losing ground against the u.s. dollar. it had been boosted by a surge in florida inflows but we do have some volatility. we do have to watch out for that as well.
we do have some numbers throughout the week when it comes to eco-data. including in japan national cpi as well. haidi: of course, and just a couple of hours getting that latest reading on domestic activity data out of china. that is going to potentially play into how the rest of the aussie trading day goes, particular the aussie dollar which's has seen some weakness against the greenback this morning. trading in sydney without about half a percent, listening to the rejuvenation and business competence not quite happening for the australian economy. we are also seeing kiwi stocks in its fifth day of gains. trading at 71.89. taking a look at some of the assets, it is fed decision week as well as boj decision week, something about a moment of reckoning for the bond market, the treasury market, this game
of chicken set to come to some kind of conclusion. it will be interesting to see how jay powell pushes back against expectations. bitcoin, the big story of the last few weeks and months, bracing that -- breaking that $60,000 threshold. the rally continues to accelerate, thanks in part to stimulus measures. bitcoin trading now below $60,000. brent crude, also watching that story, but aced not to some of the losses, trading just shy of $70 a barrel. still, traders are taking a moment to assess the prospects for further recovery from the pandemic as well as the outlook for demand going forward. investors will mostly be watching bond yields and concerns about concerns of rising inflation. let's bring in a specialist from fidelity. we do see a move in treasuries
in the previous session. what are your expectations, in terms of what the fed can meaningfully say and do to impact the markets this week? guest: i think you described it quite well in terms of it as a game of chicken. we are likely to see upward revision to the feds stock plots in terms of growth and inflation. we will also be trying to walk the fine tight rope [indiscernible] despite the concerns about the potential of and inflation outbreak resulting from higher fiscal stimulus. shery: it's an interesting position to view all of this. we have been talking about the demand for a portfolio allocation. what is the alternative to bonds if you are looking for better performance? what does the modern portfolio
even look like? guest: it's really hard. once upon a time, you were paid to take out insurance by generating a positive real yield. today, that is gone, and real yields are deeply negative. if you are looking at the u.s. 10 year, -60 basis points have arisen from -100 basis points less than one month ago. one area where we are looking at is chinese government bonds. it is an area where you can continue to generate positive real yields, otherwise, as i have said, investors have to start paying for that insurance and defensiveness and the uncorrelated nature of government bonds today. edison be a case that if you are looking at generating the returns that you want, for example, you have to take more risk in your portfolios. look at spread products, high yields, that equities.
shery: when it comes to china we have seen liquidity concerns, regulatory concerns, not to mention investors were pretty disappointed with a more than 6% target for the year. what are you watching in terms of opportunities there? guest: obviously, the chinese authorities have been conservative relative to the u.s. authorities. we think that globally, the stimulus we are seeing from the u.s. will more than make up for the lack of stimulus in terms of china. today, we think that on for china equities represent pretty good value. it is a part of the world in terms of asia in general which tends to be, has good experience in terms of the performance over the course of the past year. tech. what we are looking at the moment, there are regions of the world that can benefit from high commodity prices and this
reflation everything we are seeing. emerging markets we are seeing in latin america. this could be the potential source of the next alpha we see from global activity markets. shery: how are you factoring in the china-u.s. relationship, given we are expecting this alaska meeting? guest: we are not geopolitical experts, but it is certainly a risk that you have to try and encompass within your investment allocation. obviously, the news two years ago was trade tensions. today there are different concerns in terms of vaccine rollout and the ability of economies to open up. certainly, this theme of globalization, the reassuring of supply chains. does tensions are likely to persist. certainly, we think that the biden administration will be a
little more willing to potentially negotiate with their chinese counterparts, in terms of the potential outcomes, in terms of global trade, for example. haidi: i have to ask you, $60,000 is where bitcoin is trading at the moment. where do you sit on this rate debate? -- great debate? guest: i think it is a bubble, personally. i can see how it can be articulated like gold for example, but it is very difficult to see it replacing fiat currency. i find it difficult to see how the authorities would never allow that to occur. not to talk about the negative externalities that eventuate from a mining bitcoin as well. for me, it probably highlights in a low interest rate world, where real yields are negative, speculation builds in a number of targeted assets. bitcoin is one area of the world
where you are seeing that play out. i have no issue at all with the technology, blockchain, but the rise of the retail investor for example, other parts of the market that look extended in terms of valuations, rising leverage, i think it is certainly something central banks will have a close eye on. shery: great to have you with us, joining us with fidelity. don't mess and it's elusive interview on the outlook for filipino stocks. we speak with the ceo of the exchange in the next hour. let's get to vonnie quinn. >> australia is offsetting demand from china by targeting saudi arabia. for the first time in five years, australian exporters have broken into the saudi market. australian grain suppliers seem likely to provide the bulk of the kingdoms 660,000 tons of orders this year, pushing out regular clients from the eu.
the military leader sub myanmar have imposed martial law on the commercial center, after security forces killed more protesters across the country. the move came after beijing asked for better protection of chinese owned businesses. security has been passed to the head of the command who can use the army to maintain army. angela merkel has suffered her worst election defeats as voters in two states -- support for the party fell four points to just 23%, compared to 2016. the social democrats their hold on power. the elections are the first time voters have been able to express a view on merkel's virus strategy. police in london are under fire after arresting mourners at a vigil for a woman who was abducted and killed. officers moved in after hundreds of people gathered at an unofficial memorial.
a police officer has been charged with her abduction and murder. the metropolitan police service says the mourners were breaching covid-19 restrictions. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. haidi: still ahead, astrazeneca has vaccine woes. the company says it's safe even though rollout has been suspended across developing countries. bitcoin had touched $60,000 for the first time, why investors are ignoring signs of a potential speculative fervor. this is bloomberg. ♪
news that the company plans to raise $2.2 billion by selling shares. right now, seeing its best day since 2004. they are going to sell shares to investors including tencent, walmart, and japan. in fact, rising more than 3% on the share purchase. the company seeing its best day since 2004, rallying more than 13%, and at one point rallying more than 18%, given news they are planning to raise more than $2 billion by selling shares to investors. shery: let's go to hong kong, authorities have locked down areas and sent hundreds into quarantine to contain the latest virus outbreak that is tied to a gym. our chief north asia correspondent joins us from hong kong, what do we know? reporter: we know that there have been one are nine cases tied to this jim outbreak from
last week. in the western part of hong kong island. that has had a spillover effect to some 750 people who are considered to have coat -- close contact with those 109. they have been sent to quarantine. included in those 750 sent to quarantine is a group of eight infants aged 11 to 18 months, and their caregivers. they had attended a playgroup, and one of the parents of the children was confirmed positive. 24 new cases were confirmed yesterday. sunday, 10 of them were tied to the gym. compulsory testing has been ordered at 90 residential locations as well as 60 worksites, including offices housing ubs, cathay pacific and a number of other buildings where compulsory testing has been ordered. you are seeing some of the
footage of the lockdown. two more residential areas were locked down late yesterday in addition to the four buildings in the mid-levels. haidi: what is this i am hearing that, if you get the chinese made a vaccine, it could make it easier if you are trying to get a visa to get to china? reporter: that's an interesting story. the sinovac vaccine is available here in hong kong, along with the pfizer. china is saying if you are a foreigner and you want to apply for a visa to come to china for work, and you have the chinese vaccine. there is the sinovac and there is also sinopharm. if you have a health certificate saying you have gotten the chinese made vaccine, the chinese government is saying you can skip a lot of the red tape
in apply for a visa. you can also skip a test at the airport or the point of arrival. again, china is saying that the new rules will take effect as of today. most country -- countries have yet to approve chinese made vaccines on the grounds that trials have not necessarily been fully trust -- fully shared. western countries have not. there was a deal signed last week between the international olympic committee and china to supply chinese made vaccines to accede that's athletes coming to tokyo. it goes back to who we spoke to in the last hour to talk about the politics, involving the vaccinations. haidi: our chief north asian correspondent. speaking of vaccines, astrazeneca is under pressure as
more countries suspend the shot amid fears of blood clots. that has prompted the company to offer reassurance that the vaccines are safe. the former chair of the who's safety advisory board agrees. she told bloomberg there is enough data to support continued use of the shot. >> we know that there has been some people with blood clots and other blood conditions following the procedure. conditions like this are not unanticipated. there are going to be a raft of conditions we expect to see occur, just by chance, because they are happening all the time anyway. >> do you think it is appropriate that vaccines with astrazeneca are halted or suspended while some of these inquiries happen? or do you think, given how much the virus is circulating, they really should persist with
vaccinating people and using that particular vaccine? >> but we are seeing here is an abundance of caution. nobody at the moment think that they are caused by the vaccine, but want to be cautious anyway. as you said, some of these countries have a lot of covid. covid itself causes blood clots. you have to be very careful, it is very unlikely. >> we have to remember that these vaccines have actually been given emergency use authorization, they are not fully registered. do you think that while they have by and large shown to be safe and effective, we are still developing our understanding of these vaccines? >> they have undergone
appropriate trials. we do have data and enough of it. there has also been an enormous number of people that have received the vaccine, tens of millions of people. we also have quite a lot of data already. we are way beyond the experimental phase. [laughter] we are in a stage where we need to appreciate that these things are going to keep coming up. we are doing massive mass vaccination campaigns and people get sick all the time. we can't panic every time it happens, but we also need to take all precautions. it's a hard balance. shery: the former chair of the who's global vaccine safety advisory committee speaking to
haidi: let's take a look at bitcoin which is fluctuating by starting to creep closer to the $60,000 mark that it for the first time, bouncing back from the late february rally. at its highest it was over $61,000. we are seeing the steady climb higher, the rally continuing to divide investors. skeptics see a giant ever increasing stimulus driven bubble. let's bring in andrea. it's not controversial, how controversial bitcoin really is,
given we see the checks going out, how much further does this rally have to run? guest: that is the million-dollar question medic comes to bitcoin. it has been an outstanding rally. but we have seen over the weekend, it has been caught up in this buy everything momentum. following the stimulus package in the u.s., also, more confidence about the economy with vaccines being rolled out. interestingly enough, bind bitcoin out is equivalent of 35 ounces of gold. that is about twice as much as it was at the beginning of the year. it just shows you how spectacular this rally has been. one of the reasons is that it is getting increasingly -- increasing institutional interest and attention. champions of bitcoin see it as
increasing store value. akin to gold as can act a hedge against inflation. inflationary concerns are now out there, and also against a weaker dollar. they are also pointing out to it being different to the last boom and bust in bitcoin, because of this wider uptake with tesla's $1.8 billion investment. elon musk endorsing it. and also, other investors. they are saying it could reach $100,000 by the end of the year. it's anyone's guess, i guess. haidi: an incredible rally. what is the story there? guest: that's right. the reason that company is in
the headlines is because market value subtly surged to $34 billion, that placed it behind bitcoin and ethereum as the third biggest cryptocurrency. it caught the eye of investors like mike, with a loyal following on reddit. there are still issues with this particular digital coin. its network lacks many of the functionalities available on more established rivals. but look, one explanation for the sudden interest is that it is an alternative to ethereum, possibly. shery: our cross asset editor with everything on bitcoin. here is a quick check of the latest business flash headlines. reports from paris says a dairy giant has asked its chairman and appointed a new leader. a newspaper says the person has
been toppled and replaced, who will now lead the search for a new ceo. he said earlier this month that they would step down as chief executive but stay as chairman, however the board met on sunday and decided he should go. two of the three largest pension funds are a step closer to creating an industry giant with more than $150 billion. the government of queensland is supporting the proposal, with the two funds in talks for at least a year. the pension sector is facing increased scrutiny and growing pressure to cut fees. one company is crating a new team to help public and private companies. there are 20 people on the team at the moment and it will start work officially on april 1. the plan is based around unlisted securities as the ceo
>> this is "daybreak asia. janet yellen downplays the risk of inflation. she told abc the risk is minimal, but manageable with temporary movement in prices. an economist sees the fed hiking rates in 2020. they do not expect to see that reflect it in the forecast this week. astrazeneca insists it vaccine is safe as more countries ban.
the company says careful review of the data shows no evidence of risk for pulmonary embolism or clotting. 17 million people have been given the astrazeneca job in the u.k. and europe. sydney is reporting its first local covid case for almost eight weeks after a hotel quarantine worker tested positive. the man works at two centers for returning travelers. he had received the first of two doses of the pfizer vaccine. new south wales says it is too soon to know if there will be restrictions this week. china is to report more eco-data with analysts expecting strong growth in january and february. figures will be based on distorted reports. close inspection of the numbers will offer a frank look at a possible recovery with exports and imports leading the way and consumption lagging.
global news, 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. shery: we are seeing broad gains for asia. consumer discretionary and financials are leading the gains. japanese yen continues to see a bad week. we did have core machine orders beating expectations. we are watching record 10 in japan -- rakuten in japan after they announced plans they will raise more than $2 billion by selling shares. in korea we are watching lg's battery unit. they are seeking an ipo as early as july. the kospi seeing its best again in over a week. when it comes to lg chem, it's
best in about a month as well. pressure on the asx 200, kiwi stocks gaining grounds. haidi: washington kicking off the palmetto engagements in asia this week -- diplomatic engagements in asia this week. let's hand it over to our reporter. there are signs this will be a difficult one. what are the disagreements we are seeing about the holding of the meeting itself? >> the sides are disagreeing about the talks themselves and what they represent. a spokesperson from china said this was a high-level strategic dialogue, a reference to talks that had gone on during the trump years, but had collapsed. tony blinken had told congress a
day before that very specifically this is not strategic dialogue. there is a lot of posturing ahead of the meeting. >> is there anything positive that could come out of this other than the fact they are talking? >> certainly after what we have seen, sanctions and tariffs, kicking out journalists, closing consulates, all of that was going on at the end of the trump years. the fact the two sides are talking certainly is a sign of progress. in the press conference at the end of the national people's congress, it was said that just the fact they are talking will help boost trust. if you get beyond what the talks represent, the fact they are talking is a sign the sides are
trying to move beyond the nsions of the trump years. >> what kind of a message do you think biden's team is going to send asian allies? including australia and the region. >> the key messages they are moving beyond what the trump administration did when it came to its approach to china. the emphasis is not just on confronting china, but other issues such as climate change, the pandemic. president biden had a virtual meeting the other day with india and emphasized cooperation on those sorts of issues. i think we will see tony blinken and lloyd austin when they are in japan and south korea, they
are going to try to reassure countries about america's security commitments following all of the uncertainties during the trump years about the extent to which the united states was committed to maintaining security relations with these countries. >> the focal point of the tensions has been tech. last week we heard china will boost spending to reduce reliance on american tech. let's bring in randy abrams. randy, it is great to have you with us. china, three hundred billion dollars of semiconductors annually. how long will it take for china to close this gap? >> good morning.
china, they have been making quite a bit of progress over the past year. you are seeing it a lot of domestic companies. i think of attraction -- the traction is on mature technologies. really developing things like microcontrollers, consumer chips , some of the lower end smartphone chips. they are growing quite a bit. in some ways, it gets back to what you were discussing earlier. there have been restrictions from the u.s. in terms of advanced tools, restriction on m&a. the has been limiting china to some extent. developing advanced foundries to make high-end tools. it is going to take time.
we will need in some of those negotiations eventually some of the restrictions to loosen for them to close the gap. >> they are pledging to make these investments in the sector. that means chipmakers will need to spend more on research and development. how much will that hurt the bottom line? >> there have been good support. we have seen in r&d, those amounts the government is willing to give to a strategic project of been increasing. despite the high investment, we support -- a second factor, the mature lines have been kept quite tight. the industries strength is lifting all boats. in terms of capex, as long as
they are spending on the mature notes, they can it a good return. in a way the u.s. restriction on advanced tools, that is a long time to return investment, but on the mature know is where they can invest. >> it has been two decades of focus from china on this industry. when do you see critical mass in the industry? >> we have gotten to a stage where there is decent -- a decent system. china as the factory, that was the first part. they have done well starting with manufacturing. a lot of hardware components through the value chain. now there is a domestic base. china is 20% of volume in a lot of tech markets. china brands have about 40%
market share. there is critical mass even supplying into the domestic market. china has a lot of mature parts of the industry where they can access tools, talents, ip. they can develop the chips. i go back to the very advanced nodes. there is still a bridge to taiwan. they can still go to taiwan foundries. i think they still need that bridge to have critical mass across the industry. >> when you look at what is happening across asia on the demand side, is there a case we will see continued supply tightness? >> there is a good case for that. this is about a 20 year high in terms of tightening. we have not seen these constraints really since two 2000. 2000, y2k, the emergent carriers
were early cycle for auto industrial, coming back. smartphone volume was down. we are in the second big year. i would also say ongoing is with the cloud. they look to continue throughout this year at a quite low-level and i would say coming out of covid, supply chain would rather carry more inventory to manage bottlenecks. we expect the industry to stay pretty tight throughout this year. >> we heard u.s. and china chipmakers were getting together for one reason being they want to talk about the supply chain and the tightness in the markets as well. this of course really is taking the focus that perhaps we could see a little bit of thawing
relationships between the u.s. and china. what do you expect from the private sector when it comes to bilateral tensions? >> the private sector objective, and i would say from u.s. semiconductor industries, their goal is really to enable business for the u.s. should companies. they don't necessarily like to see restrictions to prevent some of the emerging china companies access to technology. what we are looking for is some degree of compromise. to that extent, from u.s. industry, to supply a lot of the major technology. where we could see tension, the most advanced tools, it does look like from a government perspective, there could be restrictions. i think they want to keep as broad a blanket as they can. keep the amount limited to a very small magnitude.
>> how concentrated is the market when it comes to supply? there were concerns taiwan was taking too much of the market share. >> advanced technology, it has become a reality for the industry. just a few manufacturers have high market share in production. taiwan foundry, about 65% of the industry foundry capacity. it does have a high market share. a lot of the sectors most constrained, things like automotive, a lot of the chips are still made in traditional -- and that a lot of companies across the u.s. and japan. that is concentrated. it is very expensive to add capacity. there is a very high barrier on advanced capacity. that will not change too quickly or without a huge amount of capital.
>> randy abrams with credit suisse. we will be live at the asian conference. you do not want to miss our exclusive coverage. plus, guests coming up today. the vision next ceo joins us as bitcoin breaks another record. we will also be asking about new reports india has proposed a cryptocurrency ban. coming up, record 1 -- rakuten has surged. ♪
>> investors see this as a very positive move for rakuten. rakuten is the e-commerce pioneer in japan, but it has been struggling against amazon. amazon has been very aggressive in terms of e-commerce. rakuten has responded by moving into different areas including finance. it is beginning to offer wireless services in competition with big wireless carriers here. this is essentially rakuten getting back up from some very important players, particularly japan post. they are going to take the biggest stake and they are going to help rakuten by allowing rakuten to use its japan post outlets around japan as destinations for signing up for wireless services or conducting e-commerce. other kinds of transactions that can be very useful for business going forward. >> is the expectation the focus
initially will be on e-commerce surges before moving on to other areas like mobile? >> that's right. the ceo of rakuten spoke on friday about this alliance. he said the primary focus is going to be on the e-commerce business. rakuten wants to regain momentum with this retail distribution network throughout the country that will help them quite a bit in terms of transactions or picking up packages. they are also going to collaborate on logistics. japan post has delivery men showing up every household every day, so there are advantages. from there, they are looking at other opportunities to expand. other partners are pretty interesting. tencent is an enormous games giant in china and walmart has its own e-commerce aspirations.
the companies have a few different areas for potential collaboration. >> how much assistance -- how much of a boost when it comes to the mobile side of the business? they reported that significant loss last year. >> they are coming from way behind in wireless services. there are three wireless operators in japan who have had the whole market locked up essentially forever. rakuten is building its own network. it is using more cutting edge technology. but that business is losing a lot of money. they need to have allies to keep making this investment and keep drawing in partners. they have said they think they have an advantage because they are investing with the latest cutting edge technologies, but they need to recruit customers from other wireless operators, and they do that primarily by offering low prices. it is a tough combination of
heavy investments and low prices for the product you are offering. >> are executive added or for tech in asia, peter elstrom, with the latest on rakuten. we will be watching for movement when it comes to tencent shares. china's antitrust crackdown continues. bloomberg's investing and real estate editor is here. it seems inevitable tencent would be the next to be targeted in this crackdown. >> tencent is right now facing a wide range of from the government. the regulators that might be involved are everything from tech regulators to financial regulators. to the antimonopoly watchdog.
the businesses that could be under inspection include the operations, antimonopoly violation practices, and also the units that could be affected include the fintech business that have wealth management and also consumer loan lending businesses. >> this is part of that broader crackdown on tech, right? what could happen next? >> it is unclear at this point. the overarching message is beijing is trying to rain and -- rein in its tech giants. right now, a key tension is the data that these platform companies hold and how they use it and the ownership of data.
that is what we will be watching going forward. >> we have a response from lg energysolutions saying the media report we saw from harold business newspaper, that they were planning on ipo as early as july, is simply not true. this is a comment from a spokesperson that lg energysolutions on that ipo report, saying it is simply not true. >> we have breaking news. a firm said to be in talks to take iron source public. a merger could potentially happen according to people with knowledge of the matter. tela bravo, none of the stocks that has come up over the past few months, evaluation of any combined entity at more than $10
billion according to our sources. terms are final. it is possible those terms can fall apart, but we are hearing, bravo spock -- thoma bravo spac is planning to take the company iron source public through a merger. tune in to bloomberg radio to hear more from the days newsmakers and get analysis from the daybreak team. you can listen in via the app or bloomberg radio.com. ♪
>> bitcoin passes $60,000 as the stimulus deal rallies. bitcoin has surged over the past year, lifted by support from elon musk and some in the corporate world. the original digital coin treated for just a few cents. it has gained more than 1000%. stripe has raised $600 million in its latest funding round, valuing the company at $95 billion. stripe says it will use the money to improve european operations and expand its global payments and treasury network.
google has vowed to kill a lawsuit alleging it will secretly collect data even in browsers in incognito mode. the case says even if data collection is turned off, google has access to other tools that store information. the ruling comes as google and apple face rising scrutiny over their data gathering operations. >> here is a quick check of the markets. we are seeing markets reversing with korea gaining. we have seen three sessions of gains for south korea. it has gone back to negative. down 3/10 of 1%. nikkei continues to gain ground. it has been a volatile session. we will be watching out for the markets as we head to the china
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>> it is 9:00 a.m. in beijing and shanghai. welcome to bloomberg "markets: china open." david: we are counting down to the open of trade. let's get to the top stories, china reporting eco-data in the next hour. with analysts expecting strong growth in january and february, the figures may be distorted by