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tv   Bloomberg Markets Asia  Bloomberg  July 29, 2021 10:00pm-11:00pm EDT

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on s.e.c. to act. david: it is still a moving target whether they do and if the ticket private, at what price. yvonne: that will be the key question. as the best option to ease concerns with investors. we are not seeing easing of concerns here. it is like groundhog day. david: it is friday. it is looking like this. i will join you at the table and a couple of minutes. there a little down on the csi 300. iron or futures are the one to watch. equity futures, i would imagine would see a lot of pressure. nasdaq futures are not down relative to other future contracts on the back of that massive drop.
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currency markets at this point, nothing worth noting apart from the fact that on a weekly basis, the index is on track for quite a steep weekly drop. as things stand, we are still looking at what is happening in china, of course year. yvonne: everybody is licking their wounds but they are quite raw. if you look at csi, golden dragon, it has been a brutal week. we call it one day of relief that we are still lower. if you take a look, they are down 3.7%. a weekly drop of 15% or more. as the biggest weekly drop since february. there are still a lot of uncertainty out there. the rest of the market is looking really bad. david: have a look at this tech index.
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pretty much everything is down. the only bids is only coming in the semiconductor place. let us change things up. we actually flirted with a bear market. various points in time, whether that is the trade war, the pandemic hit, where we were coming out of the lunar holidays. we are still down about 18% from that peak. how we return to normalcy and the quick answer is absolutely not. still elevated. we had a dip down yesterday. seeing an uptick today on the back of this risk aversion. yvonne: we just talked yesterday
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about debt buying. where are they today? clients have been asking a lot of questions right now. our china stocks -- there over caution and to negative on china. the headwinds will dominate headwinds. it seems premature to call for an inflection point. they change their recommendation to the shares to market away. they are still seeing opportunities in the h-share market. david: he is here with us on set. i like how you guys look at this. you will that exposure to regulation. 14% csi regulation. is that ace -- as simple as making that decision? reporter: thank -- >> thank you for having me.
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what would be the impact to h-shares and offshore china equities? will you csi 300 to gauge the input? we notice that 15% of these ratings come from industry groups that would be prone to potential regulatory clampdown. that would be the internet, education, health care, as well as welfare industries. 50% of the ratings come from these centers. thereby, we came with the conclusion that we think a-shares should be well supported given this exposure. plus, the monetary support will come through. they are worried about the impact of the market.
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yvonne: it seems like mainland traders are not coming to hong kong to buy on these dips. they are become of the next sellers of stocks here. you see that trend reversing in any way? >> i think it will come from the earnings season. it will be quite mixed. i think the mainland investors will be quite concerned. which will be the industry groups and specific names that will see some potential earnings? we think there is still some hidden gems in the industries that are very sensitive to the regulatory risk. we do think that the cyclical industries have a high nightly hood of providing a policy of surprises here. david: how confident can investors be, bacteria earlier
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point on analysis and whether these come back to hong kong. how confident do you think they will be that this is the final list that it is only that? >> it's premature to say what will be the centers prone. the regulators have been getting the idea that it will spill on over to be onshore market they cared most about. that's why we think they would be careful. the measures which would still be coming through may come in a more measured approach. yvonne: you're contrarian views, i don't know if it's contrarian anymore, japan, everybody is looking at it as the next market on this cyclical theme. what are you seeing there? >> it is still a view that japan
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should be underway. global investors are most underway. if you look at the evaluation, it is one of the cheaper develop markets. we continue to see upside risk as we rate in potential as well. that's what there is an opportunity to buy into the japan market. if you look at japan first, it is europe. it is one of the most popular questions for our clients. we think they should pay in tandem historically. europe is totally outperforming japan. we think that japan is a lack of market. david: we should a graphic to your point. there's europe and s&p. japan is nowhere to be found.
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what about e.m.? india and southeast asia, something that has come up in our conversations. >> we are selective on the just like i said on china, we are more positive on onshore hs rather than offshore markets. for southeast asia, we like select orchids. it is also quite controversial given it is highly sensitive to the pandemic. we do think it is a good recovery play. if you think it will help contain the pandemic and we think that thailand would be an interesting story. david: do you need to revisit that assumption that the recovery trade will continue? >> we constantly monitor the progress so absolutely. david: jp morgan, head of asian
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equity strategy. vonnie: beijing is keeping an open mind on g7 talks aimed at reining in trade abuses like forced technology transfer and trade distortion. china says their scope for an agreement hopes it will be adopted by wto members. if they cooperate, it could be the most significant trading reforms since 2001. president joe biden is toughening up on federal employees requiring all workers to prove they have been vaccinated or wear masks and take frequent coronavirus tests. the plant will affect millions of people including the military and on-site contractors. biden is encouraging private sector employees to follow the same approach. this comes in response to vaccine holdouts. china has put out alternatives for a second investigation into
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the origins of the coronavirus. the foreign ministry says it will spend multiple countries. this counters the u.s. push into a closer look into the theory that it leaked from a lab. chinese officials say many countries are opposed to a second case study. the international space station got an unexpected jolt from a newly arrived russian module. it happened when the thrusters turned on unexpectedly after docking. iss flight controllers say they suffered no damage and none of the crewmembers were injured. nasa has postponed friday's launch as a result. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. david: coming up: we will talk more about these markets they are taking an absolute tanking in singapore.
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we do not need no education. according to the sound there. there director of -- they are negative on that. yvonne: that was pretty good. david: i just got that. yvonne: amazon's pandemic era boom is fading as they venture into physical stores. what does it say about the u.s. economy next. this is bloomberg. ♪
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david: update on your commodity markets. nothing as far as energy is concerned. that pertains to everything the important terms of raw materials. both contracts. down about 5% each of them. yvonne: you take a look at these tariffs in stainless steel
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rising 40% from 20% starting on august 1, markets not liking that news. squeeze in exports happening again. amazon's lackluster forecast is sparking concerns among investors. we saw how it played out in extended trade. we see u.s. futures lower by three quarters of 1%. let's bring in see who's got the latest. this was the stop to watch that soared to new heights during the pandemic and now, it seems to be a bit of a reality check. reporter: not quite so good for amazon. we see them go into accident hours as the online retail giant said. sales were lower, sales were slowing and the forecast was a real disappointment. has a lot to do with the fact that the pandemic we saw appears
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to be over. one analyst put it this way. they don't have the tailwinds they had last year. when you apply the law of numbers, will not to the zoo numbers we saw. we start focus into the slowing growth for the core e-commerce business. the cfo said you can expect that growth to continue. it is comparing to the shopping binges from a year ago. they could explain profitability. the operating cost was 27%. amazon is working to get a lot of its employees vaccinated. it helped to get the delta variant under control or they want to see that there this return to normalcy or pre-pandemic activity is a very
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positive phenomenon. that really is there core goal at what is unsaid is that stands to profit. david: it is a new era for amazon. this is the first earnings call since jeff bezos fell down -- step down. tell us the other key high lights and where the story goes after jeff bezos? reporter: there is a focus on andrew, even the he was not the call. and you bezos -- jeff bezos was really on the call. analysts were saying that he has to show investors he can continue the rapid sales growth and rising profit. this is at a time of heightened scrutiny in both the u.s. and europe. also notable is among the prophets overlooked. the cloud unit which has called web services. they saw their revenues go up.
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also, the other revenue category which is really advertising. it was up some 87%. these far exceeded expectations. we look into the revelry of e-commerce, they continue to blow away walmart, target, best buy. we can see in comparison with walmart. walmart still has the best revenue, but amazon has the market cap. yvonne: thank you. it just goes to show that there are a lot of questions about the u.s. consumer and how strong it is right now. especially as we have this delta variant spreading in the country. david: it was easy to have the immediate knee-jerk reaction.
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our guys parse the data and other economists due to. what you want to focus on is coming on your screens. this return to services and the contribution to gdp. that took a massive hit. that has really come back in a big way. the other one was it strips out external demand. final purchases of domestic purchasers and is this the right chart? back to levels vaccine. yvonne: we will show that chart a little later on. we will talk with -- about
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robinhood. they slide in their trading debut. we will hear from their ceo. this is bloomberg. ♪
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david: welcome back to the show. you are watching "bloomberg markets: china open." we are talking robinhood. tricky time to list your shares. even though they priced at a lower end, this is what happened. yvonne: they carved out an unusually large size for retail investors which was a big gamble. it seems like they did not come through. the broker behind the meme stock ironically, that they become a meme stock as well daca he spoke to emily chang about its debut. >> it is really humbling that
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six short years after we launched our product, we have over 22 million customers and we are on this journey and allowing them to participate. anchor: speaking of your customers, you would allocate 30% for robinhood's own users. something in the range of 20-25%. still, one of the biggest allocations ever. how did you get to that number and are you concerned about volatility? >> we certainly are proud to have one of the largest retail allocations ever. the weight we think about it is it is a long-term focus company. we are making decisions and big that's what the long-term interests of the business in mind. volatility comes and goes. we will not be commenting too much on daily fluctuations of the stock price.
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anchor: the retail movement is a phenomenon. looking at social media just this morning, there are strong feelings about what robinhood represents. when you think about gamestop, or amc, do you get worried of -- about robinhood being a target of its own users? >> we are not thinking about anything in the market in the short-term. the goal is to keep making great products. to keep improving the service. and going with our customers. we have seen certainly, finance get more important in the retail investor become much more important investing. is it something we think will continue. anchor: you livestream your roadshow to the public. retirement accounts like iras. when should investors suspect
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that? anchor: > we we want to turn short-term investors into long-term investors. we built on that like with recurring investments. if you are in investor, you can put in an order to buy a particular stock or etf on a regular basis. we will continue investing in that. we have seen good adoption and we would like to see a large portion of our company being investing in the future. yvonne: that was the ceo of robinhood. national australia bank will buy up to $9 billion of its own shares. that is 2.5 billion aussie dollars. that would be the second of the big banks provided plans to repurchase stocks. they aim to start the process in
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mid-late august. apple unloaded $6.5 billion in bonds and will return cash to shareholders. longest portion, a 40 year security allele -- yield above treasury. initial discussions were in the 115 percentage points range. this could be put towards stock i backs, dividends, or -- scott johansson is suing disney for streaming the movie online she claims they tried to draw audiences away from theaters to its own platforms. she said they would have an exclusive theater release for 90 days. disney complied -- says they claimed to comply with her contract. david: equities down. you're getting some safety in
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assets. iron ore is still in focused their ago. very much for the middle of august, the capital region will be back in a lock down. traffic congestion, that came back in a big way. here is something we notice when it comes to the csr 300 and the volumes that we had. heavy volumes on down days. things are coming down again today. we are up again on volumes which is not a good sign. it is not as participant as you will in terms of the nature of the buying. yvonne: you have to be able to differentiate the regulatory framework and sectors.
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it seems like most of the pressure is still situated in the hong kong market. potentially, that is how we are seeing that flow. we got plenty more to come. this is bloomberg. in business, it's never just another day. it's the big sale, or the big presentation. the day where everything goes right. or the one where nothing does. with comcast business you get the network that can deliver gig speeds to the most businesses and advanced cybersecurity to protect every device on it— all backed by a dedicated team, 24/7. every day in business is a big day. we'll keep you ready for what's next. comcast business powering possibilities.
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david: welcome back, it is 10:29. hong kong and singapore. good evening from the asia-pacific, the benchmark in the region about we were down two days, up tuesday, wednesday, thursday. yvonne: it is mind-boggling. what a week. let's get to vonnie quinn in new york. vonnie: the byron administration is calling on state and local governments to provide a $100 incentive to people to get vaccinated.
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the president asked states to use funds from the american rescue plan. this is to combat sagging in commission rates. he expects full axing approval in the near term. israel is offering a covid puzder shot for those over 60. it is -- booster shot over those debts for those over 60. it is the first country to do so. infections are rising. ceos for more than 90 companies including apple and facebook are urging congress to pass a law allowing a path for citizenship for on document immigrants. the so-called dreamers are valued at their companies. ceos warrant that a dutch warned
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that the program jeopardy -- warn that the program jeopardizes their ability to work in the states. at the olympics, city lee won the women's overall title. -- all-around title. this was a day after her teammate simone biles withdrew. she's 18 years old, it is the fifth straight gold medal for the u.s. in individual all-around. 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'm vonnie quinn, this is bloomberg. yvonne: we were talking about olympics, you can watch more of our coverage and keep track of results at the tokyo games with our bloomberg medal tracker on the terminal at bloomberg.com. japan, china, u.s. vying for the top when it comes to the medals cap and i've got to talk about my girl. david: third straight day.
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yvonne: silver in the 100 meters , taking it home. david: if you're watching, congratulations. yvonne: we're watching didi as well, there were rumors about its decision to turn private and it gave the share price and needed boost but the company denied all that speculation. let's get to a bloomberg opinion columnist who is saying it now has a tough choice, is it an annulment or a divorce? what do you think? >> well, for didi's shareholders who bought into the ipo, it would have to be an annulment. they just went public on june 30 and then chinese regulators slap them with a ban to lie second and what happened? we got married into something we felt was complete different. the shareholders would like to
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have an annulment, but who knows? didi might want to go for a divorce and i don't know how much alimony or child sport we would get. david: ok, i guess we are alluding to what that bill is going to be for the company, and let us keep in mind in the event that they do, and it is a big if, if they do do list and go private, -- de-list and go private, who is holding the bag at the end? shuli, do we have precedents of if it does happen, what price? were they to get out of the ipo price and slap a premium on top or the latest price? how would that work? shuli: it is interesting question. chinese companies had a huge wave of so-called going home, when the chinese stock market
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was doing well in 2015. they said we are going to come from new york, payoff investors and go back home to china. and when you look at 2015, the track record was not that great. but the to come premium was not that generous, 10 or 15%. and it was back then. so it is very questionable what the premium this time will be. i personally think going forward, didi will have to take itself or that, it's business model is broken and the same with acquisition stocks. the chinese government basically said your market is zero, what are we even listening for? the question has become, are they going to be fair to u.s. investors who are caught in this regulatory whirlwind? yvonne: there seems to be at least beijing authorities are
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trying to do some damage control. there have been reports of a been having these virtual meetings and assuring investors that the chinese companies can still list in the u.s.. how significant do you think this messaging is? shuli: i made, the rebound we saw, the goldman analyst said a lot of times they are word and it is becoming on investable -- un-investable. it's also many different angles of regulatory crackdown that we see from antitrust to data security to fintech's role and social equality in the case of education stocks. it is just a lot of issues. and we just watched, are these going to be traded like the big companies like china mobile?
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in which case they will be priced to earnings or -- sure it is nice, but we still need to see action and the actions seem to go the other way. i think investors should be concerned of liquidation which is real in china. david: shuli ren, her latest piece is on bloomberg opinion online, is it a question of annulment or do you get a divorce? let us continue the market conversation, a little bit more in china but now looking at credit. as she pointed out, liquidity concerns. whether that is evergrande or some of the regulation that is coming place, we are looking at the asia dollar bond spread, high yields overinvestment. you can see that kickoff. not to the extent we had during the market mill down, but at seven percentage points.
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you should start looking, do your homework. we went from about five to basically seven in a matter of weeks. yvonne: let's bring in our next guest, taking a look at education stocks first, we are seeing once again they are heading lower and this could -- capitulation seems to be continuing despite efforts beijing to put a floor on these stocks and at least ease the angst of investors right now. you look at that, technology, 10.5%, new oriental as well, down 7.5% and more. it is still something we are watching. david: absolutely. let's crackdown what it means for credit risk, credit ratings, liquidity, solvency may be in some issues bring in forward the director of china corporate research. laura, a pleasure to have you, thank you, good morning.
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interesting week, to say the least. let's try and separate education from the rest, because that seems more acute when it comes to afterschool education and some of the stocks. when you first heard the news that essentially, china said economic profits in some parts of your business, you can't raise or and tax, what was the first thing you and your team did? >> one of the first things we did was look at how big the impact would be on the company-- . we are looking at to what extent the company will be affected and how much of the revenue is exposed to these companies. now, we are looking at how the government is going to implement this -- these rules. it seems like the rules are
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unexpected, and we expect breakthrough in fermentation of the rules. for the next step, i think we will be more concerned about which companies liquidity position and do they have it, and whether they have enough, access to bank financing or other financing, the physical effect. we will have to apply a case-by-case approach for each company in this moment. david: flora, we were speaking with stanley yesterday, he was here with me and yvonne. he basically said, we should have seen this coming. whether it is statements or from the state council, there were starting to look at these different sectors. based on your research, in terms of that credit risk looking
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ahead with the corporate sector in china, does any other sector stand out to you that might be next? we are not saying something will be next but are there candidates there? flora: these are interesting questions, but i think the government policy will continue to focus on these and pick up living cost and it will improve their affair. if any sectors have any issues, we will probably see it in regulation. but i want to point out that on the other hand, any sector that has been -- it might be in favor of strong government support, what do we see in a location,
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dutch allocation, which received gross dutch support from the government -- support from the government, and we also are seeing strong factors expecting capitals will be more in the sectors. yvonne: and a lot of these education companies don't have a lot of debt, almost no dollar bonds. overall, what do you think broadly speaking, how does this affect the onshore and offshore bond market? flora: well, these companies are not big bond insurers. and in the regulation, the best practice for those companies outside of the sectors -- even their business will be significantly disrupted, but the
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company will need enough cash, they will have a lot of cash on hand, if they are banking in the business they can still do that. to be honest, i think for them, if they are not allowed -- the public are not -- it will happen and we will know the facts of the system and it will bring too much impact on the sector. david: flora, a pleasure to have you on the show, but to see what happens with this one. in a strange way, as they were mentioning, the dollar debt on these committees is not so much but focus but if you are an equity investor, if you've got private money that's a different proposal altogether. where to commute to manila, the
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president -- my mistake, the defense secretary of the philippines, from the u.s., they are restoring be visiting forces agreement with the united states and this comes midst what has been happening geopolitically with china. we will get into that, it's a complicated conversation but tensions are growing in the south china sea. some live pictures out of the philippine capital, where, by the way, i guess we will talk more about the market reaction later. yvonne: yeah, this is the u.s. trying to pivot more toward asia on the southeast asia trip for the secretary of state, lloyd austin. taking a look -- i'm sorry, the secretary.
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stories we are watching out of southeast asia, the philippines re-imposing a lockdown across the capital august 6 through 20th amid a surge of cookie cases. -- covid cases. a malaysian king publicly prorated someone for misleading parliament, asked him to resign. and the united nations had a call for action against myanmar's military. david: the market across southeast asia, the benchmark it -- benchmark. only one weekly gain, we are flat this week, only one weekly gain owing back to early june. here's the state of play for today and within that market, the philippines is a focus as yvonne was pointing out, reimposing a stricter lockdown in the capital. we are very close at this point,
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16 363 from recent lows, taking it all the way back to levels back in late may. yvonne: coming up our interview with credit suisse ceo as they work to deal with the scandal. this is bloomberg. ♪
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david: welcome back.
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let us have a look at credit suisse, the company and bank is under pressure, missing profit estimates. they're working to recover from one of the, or its most turbulent. -- period, reverberating in the investment bank and with management. yvonne: we have the ceo, who promised no more archegos errors in an interview. >> we are doing a review together with the board of directors and executive board. we are having productive discussions. want to take our time to do that because this is not something we want to do in a rush. we have an intention to formalize a long-term vision for the bank and the concrete midterm plan. this is what we are doing now with the board of directors. and we are looking, obviously, at all of the options. but we have some very clear
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views of where we are going but we will not, as you can imagine, start to disclose part of that strategy. we will communicate when we are ready to do so. >> but we should still consider investment banking as core to credit suisse? >> look, we have been investing, as you can see, in the numbers, both in terms of technology, in terms of -- in people. i'm going to pitch it myself, investment banking has been and is absolutely core to our business and we are investing in it. we are starting--spending a lot of time with it and as you know, we have a strategy where we bring our wealth management capabilities together with our investment banking capabilities, available to clients, prior
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clients. >> what can you tell us about the response of credit suisse to the review released this morning? it's as a risk control architecture it, but it was a failure to discharge certain duties and prioritize with mitigation. what is left to do ensuring up credit suisse to make sure risk management is robust? >> as i said, we are taking this event very seriously. we lost with one client, 5 billion swiss francs. this is why we decided to publish the full report. it goes into a lot of details about some of the failures, but also recommendations. the failures are centering around a lack of effective risk management and prime sources, both in the first and second line of defense. a lack of oversight in investment bank efforts -- and risk management. a lack of escalation and a lack
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of prioritization of certain risk mitigating steps, which has been discussed by some of the team and -- like, moving clients like archegos to stop with risk marketing -- management at risk marketing. but we have learned, and we are determined to take lessons from this. you're doing a global risk review across the bank and we will make sure that anything like that will never happen again. yvonne: that was credit suisse ceo thomas gottstein discussing the bank strategy review with anna edwards. more. this is bloomberg.. . ♪
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yvonne: you are watching "bloomberg markets: asia", in the next hour of the show we will speak to the founder and ceo of india's largest broker. joining us in investing in india and his company's growth plan on the back that robinhood ipo. one of the worst we saw of that side. in the us.
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key economic data in the region later, hong kong gdp numbers for the second quarter, taiwan as well and taiwan -- tyler june trade numbers. hong kong looking like 7.8%, possibly hoping to see vouchers the government is handing out is enough to juice the economy. the big one this weekend, china's numbers for july, estimates are for 50.8, still looking good but there has been a trend of a moderating type of growth when it comes to export as well. that felt the lowest since last year, possibly signaling that a slowdown is looming. here is what anz had to say about that. >> it would be the purpose of supporting china's manufacturing sector. the proliferation of internet platform is believed to redeem personal cost because of the economy of scale and arrive to
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the monopolistic practice, but at the same time, it squeezes the profit on industrial many doctors. the regulation of these companies could support many factoring sectors. david: the chinese story is in focus but let's start with the philippines, the hot news the last 30 minutes. reimposing a stricter lockdown in the capital, as you can see, pretty much every single number on the benchmark has got -- apart from him, which makes -- apart from that, which makes booze and alcohol, which can be done at home. but what is happening across this market, we are calling this next chart -- the drop we are seeing is taking a lower end. we watched that technical influx. we are still looking at this, the tech index, 2.5% down after the talk we got yesterday.
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it did not last long. yvonne: no. it is just brutal watching this. all the guests we have been talking about, they all are tired. us too. fmi see -- those plays are safer, they are getting that support from the government and we are seeing more diversion from them -- these local chipmakers. david: jp morgan was on about 60 minutes back, they like asian semiconductors. i would even and choose that. the exposure to regulation is 50% on msci china, which goes down to about 14%. as we make our way into the next hour of bloomberg markets, here's the state of play, thailand and india opening up in
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the next hour or so. yvonne: fingers crossed. dr. 5% in singapore, plenty more to come, we are talking about india. this is bloomberg. bloomberg. ♪♪
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>> from the heart of where innovation, and money buying, from silicon valley, this is bloomberg technology with emily chang. ♪ emily: this is bloomberg technology. in the next hour, amazon under the ceo, the giant falling short of estimates. we will talk about the post-pandemic future of amazon.com.

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