Skip to main content

tv   Bloomberg Markets Asia  Bloomberg  February 8, 2022 9:00pm-11:00pm EST

9:00 pm
covid rules yet, and some rallies after starting the ipm -- ipo roadshow for a chip designer. rishaad: a lot of things are helping foment this rise in equities today. near session highs for the s&p 500 by the end of the trading day, a .9 percent surged to the upside. the bond market, we will come to that in a second. and we saw and overlie with some signs of calmness on the ukrainian situation. top advisers here in hong kong saying perhaps we could see the city reopening within the year. looking at all that and the hang seng leading the charge when it comes to regional benchmark indices.
9:01 pm
haslinda: earnings looking pretty solid, and some confidence in the resilience of a global economy. bear in mind all eyes on the cpi data and we heard from the san francisco fed president saying inflation is likely to go higher before easing, but she does not see 2% inflation by the end of the year. taking a look at where benchmarks are right now, pretty steady. hong kong and outperformer, up as much as 2%. the golden dragon china index jumping about 4% yesterday, getting a lift on expectations of the so-called national team that's into help the submarket. it's really about the bond market. 10 year yields in the u.s. up
9:02 pm
1.7 percent. begging the question, will we see 2%, some say unlikely, the upside may be limited given that the bids are already making money. rishaad: we were really looking perhaps at equity markets in china to be on the upside, given what happened yesterday with the national team coming in. having a look at what happened and seeing a bit of a turnaround, we've got benchmarks turning negative. down marginally, the hang seng being buoyed up by the technology companies in particular. we do see the stocks trading within a tight range. we saw that intervention come through. and expecting the national team to perhaps curtail volatility, and that could be key.
9:03 pm
having a look at some of the groups, seeing which ones are driving the advance. the staple side of things were helping to lift that market up but that has turned around now and we are on the way down with industrials and health care perhaps responsible for what is going on as we see a little bit of a drop taking place. tell us about the national team in a bit more detail. haslinda: that intervention we saw yesterday, according to reports, not the best. receiving the national team coming in and it does not necessarily mean a reversal on the selling that we've seen. more importantly, with a national team coming in play, intervening, it's lasting perhaps -- lessening the volatility. perhaps it alleviated the
9:04 pm
volatility in the markets. rishaad: just seeing what is going on in fixed income markets , with regard to treasury yields, just coming back a little bit, but it doesn't mean the selloff is complete. 1.93%, we do see perhaps, according to many investors out there, that markets look to push these yields on the tenure beyond 2%. this is with expectations for more interest rate hikes mounting. the fed battling with that hawkish inflation -- hottest inflation since the 1980's. but let's don't forget it's being seen as being short-term. the proof will be in the eating and that is on thursday when those numbers do come out. haslinda: that's right, key
9:05 pm
data. and lots of questions whether the boj will intervene or not, given rising yields in japan. the boj sticking to its bond buying plan as yields test the limit. this is perhaps an indication that it is quite comfortable, priced tolerance and rising yields, we got to wait and see how long that tolerance will last. tenure yields at the highest level since 2016. five year yield positive as well. rishaad: let's get to our guest, chief strategist at hong kong asset management, an independent asset management firm with branches in hong kong and dubai. andrew, always a pleasure. what are you making about what is going on with treasury
9:06 pm
markets and the said moving yields up? it does seem as if they have woken up and smell the coffee. andrew: big news, the four biggest economies in the world. the united states will increase interest rates and that is reflected on the heels. bank of japan said we are not hiking. actually they are doing everything to keep yields down payment and the people's bank of china has cut interest rates. so count them, one will increase and the others won't. we are not seeing central banks increasing interest rates. so it is very eurocentric. -- let me try that again, very u.s.-centric. it's not the only important thing that is happening in the world right now. what can i say?
9:07 pm
haslinda: we've got a bit of news coming from the hong kong economic times about the latest number of covid cases here in hong kong. rishaad: will have more on this with stephen engle. that aside, is perhaps a bit redundant to say, but what happens to the dollar, given what you just said? andrew: i sound like an economist. this gets complicated. not everybody is increasing interest rates. the u.s. is increasing interest rates, and of course the dollar is going to strengthen. if the markets are right and the headlines are right, everybody is increasing interest rates, then the differentials are not
9:08 pm
widening. so there is no real reason for the u.s. dollar to strengthen. my view is that the u.s. dollar will strengthen because everybody else is not going to increase interest rates for the time being, possibly even the end of the year. haslinda: when you take a look at the yield curve, it is latin, but perhaps the u.s. economy will be weakening, or at least there's the possibility of that happening. surely it must be a weaker dollar environment going forward. andrew: i feel like the old line of saying stop calling me shirley. the economy likely would weaken, that is the whole point, in order to bring inflation down. then what is likely to happen, because that is going to happen
9:09 pm
well down the line. generally it takes about nine months before increases in interest rates in the united states begin to bite. haslinda: you say we are u.s. centric, and indeed we are. the 10 year yield, for instance, what do you say? andrew: the markets are almost there. i keep saying read my lips, the fed is going to increase interest rates. why not 2%? it is likely and it is bound to happen. the highest inflation since the beginning of the galactic intervention. it is going on. but at the same time, real wages are coming down. that is kind of negative, because everything has been blamed on increasing nominal
9:10 pm
wages. but the nominal increases will be lower than the 6% of inflation we are seeing right now. so my answer to your question, yes, why not 2%? rishaad: it's gone far too quiet in the trenches. news of evergrande has gotten really quite. that doesn't mean the problems have gone away. andrew: i will slice it up in three parts. first, china is a very self-sufficient economy. it is not true that china depends on exports. china for -- china can actually look down and count a great degree of relationships with the
9:11 pm
rest of the world and still the economy can go. japan cannot do anything of the kind. they are doing incredibly well for an economy in lockdown. there is no reason to expect that the property sector is going to develop into a systemic crisis. and if it does, the chinese government has more than plenty ammunition in story 25 this. they are already doing it a little bit, for example by loosening up some of the mortgage conditions. the third point is that there lockdown policy, the zero covid policy will continue to maintain not only china but hong kong, isolated from the rest of the world. hong kong is not a self dependent economy as china is. haslinda: before we let you go,
9:12 pm
the question of the day for you. what is a bond bear market and are we in one? andrew: we are in a bond bear market in the united states. not yet in japan. england and the european union, the bund went from-negative to sort of zeroish. meaning they have come from -20 two potentially positive. it is true that prices are coming down, but the bear market as is right now in the united states, that has to be shown because you don't fight the fed. and the fed increasingly said were going to increase interest rates. possibly in march is the usual answer. haslinda: always colorful,
9:13 pm
andrew with an independent asset management firm. vonnie quinn is in new york with the first word news. >> russia is cracking down on emmanuel macron's talks with vladimir putin. he said putting agree not to undertake any new military initiatives in the region and to withdraw russian troops from belarus. however, the kremlin declined to comment on any assurances made to macron, saying russian troops were already due to be in belarus later this month. >> he told me he would not be at the origin of escalation. i think that is important. >> protests have blocked the countries main roads into the u.s. in canada. it has paralyzed traffic on a bridge that carries 25% of trade between the two countries.
9:14 pm
the prime minister warns the demonstrations are hurting the economy. the demonstrator say they won't leave until all mandates are lifted. and seizing bitcoin stolen during a crypto exchange back in 2016. officials allege they conspired to launder nearly 12,000 bitcoins. the doj says it is the largest financial seizure ever and is proof that cryptocurrency is not safe haven. those are your first word headlines. rishaad: still to come, we will speak with john wood about his work helping young women in the developing world to seek higher education scholarships. coming up next, hong kong facing the biggest test yet on covid policy. we'll hear from a key advisor to carrie lam on when the economy
9:15 pm
can possibly open. this is bloomberg. ♪
9:16 pm
9:17 pm
rishaad: we are back, this is "bloomberg markets: china open." hong kong allowing gatherings in private homes since the pandemic began. stephen engle speaking to one of carrie lam's top advisers. this is a big move by the government, and the question is, how are they justifying it? stephen: well, they look at the numbers, and the numbers are being reported by local media for wednesday, the number of new cases at 1161, reported by local media, not official yet. if you add that to the 600 plus cases over the last couple of days, and 700 on the weekend, that's 3086 cases over the last
9:18 pm
five days. they're quite worried that this fifth wave of the coronavirus outbreak is going to get out in front of them and they will not be able to catch up. so they're going to stick to dynamic zero covid policy. a spokesman spoke exclusively to us this morning. one of the big takeaways is that as they start reading the science more about omicron and how it shows up a lot quicker, he says the next objective could be reducing the quarantine period even further. this is just a snippet of the wide-ranging interview. he says he is optimistic, very optimistic that hong kong can open up within this next year. >> i don't think we can ever going to a full lockdown. we just can't do it in hong kong. we cannot have the same sort of lockdown that you see on the
9:19 pm
mainland. that's just not possible in hong kong. but we will try to contain it through quarantine and isolation and try to bring the number down. but the objective is not to stay at zero forever, because it is impossible. the way i look at it, we are pretty much buying time enough to get the rest of hong kong vaccinated. until then, i don't think we can afford to overwhelm our health care system. you look at singapore, in the last three day stair reaching over 10,000 cases a day. because they have a higher vaccination rate, the hospitalization and death rate is very small. so we need to achieve the same pattern as well. if we open up now, i bet our entire health care system will be overwhelmed with a lot of patients, and we cannot afford that. >> what is the timeframe here, when is enough enough?
9:20 pm
we can't continue to go on like this while the rest of the world is opening up. what happens when we hit 90%? are there steps in place that we can bet on? >> first of all, there are two issues. i don't want to just blame everything on those who are unvaccinated. we will still push to reach 90, but now that we have enough data collected on omicron or delta, we cannot try to mitigate the risks. haslinda: that was in our chan speaking to stephen engle. thank you so much for that. still to come, some bank starting the ipo roadshow for a chip designer a year early. we break down the prospects with a strategist just ahead. this is bloomberg. ♪
9:21 pm
9:22 pm
9:23 pm
haslinda: welcome back. plans to take on the public in the u.s., pitching the potential for a chip supplier. >> it is coming to the golden age, that's my feeling on this. haslinda: so admitting the storm has only gotten worse. let's bring in our tokyo stocks reporter. how are investors responding to this ipo? >> so far, as you can see from
9:24 pm
the share price reaction, we say or -- we see shares rising. the initial reaction is quite positive, actually. i think it is because although the the collapse of the deal with nvidia was negative, the possibility of that deal collapsing has been kind of christ in, so a lot of news coming out before the actual confirmation announcement, and analysts, some analysts are saying that a quick turnaround to shifting the deal to an ipo is seeing a warm reception, because of the clarity on what will happen to arm. of course how big the deal is going to be is the next big question and the analysts are trying to kind of figure out how big that will be. what we will see what happens, of course. rishaad: what about the overall picture that softbank is
9:25 pm
painting for its future? >> the earnings, as you can see, they did see profit at their vision fun, profit in the latest quarter, but the key question is, their whole entire portfolio is a bunch of technology companies, and given the current global environment, the interest rate, the fate of the whole portfolio kind of lies on how these technology companies perform. so based on -- it really depends on how the technology market performs going forward. there isn't, i must say, the -- a huge change route it's not like there is a big shift in sentiment toward softbank and it does face a lot of challenges going forward. haslinda: our tokyo stocks reporter there.
9:26 pm
nissan upgraded its profit outlook a strong demand and rising prices helped offset chip related production losses. the japanese automaker sees net income at 1.8 billion dollars for the fiscal year. strong to manus supporting nissans strategy to boost margins. fourth-quarter revenue reported below estimates at $2.3 billion. the company says it expected 2022 business environment to remain challenging and volatile because of the pandemic, and inflation as well as human sentiment. rishaad: we've just been talking about softbank, and alibaba which they own a quarter of, they're saying that filing is not yet tied to any transaction yet. this just coming through after
9:27 pm
registration with the securities and exchange commission there. 6.4% up at the moment for alibaba shares. a bit of a move up for equities in this part of the world. hong kong leading that charge.
9:28 pm
9:29 pm
haslinda: 10:29 a.m. in hong kong and shanghai. 9:29 p.m. in new york. japanese markets going for a break in just a minute. the nikkei 225 up. yen listing automakers. when it comes to japan, the boj. not buying more bonds than planned. perhaps it is comfortable at the moment. rishaad: looking at the nikkei
9:30 pm
to 25, a matter of seconds. it is the weaker yen helping propel the equity markets. japanese stocks getting a lift from the likes of retailing. the largest contributors to the nikkei to 25. we do have gains in automakers and electronic companies after the yen did we can. let's have a look at the movers. just checking in with some of the top movers in this part of the world. a lift from the transport side of things. toyota and honda. transport systems, as well. 5.8% to the upside for bancshares after they got the profit. the buyback at the moment, seeing share price surge by the most may of 2020. that is what we have with regard to these markets.
9:31 pm
japan out for lunch for the nikkei to 25 helping lift the regional equity market. a look at the first word headlines as we get over to new york with vonnie quin. >> with higher -- pen -- pope benedict the 16th is asking for forgiveness for any mistakes made in his handling of clergy sex abuse cases, but denies any wrongdoing. he was criticized in an independent report suggesting how independent abuse cases were handled by the catholic church. the 94-year-old was accused of misconduct for failing to restrict, even after convictions. the wto sided with korea in a dispute concerning u.s. levees on exports of residential washing machines. tariffs were imposed by the trump administration and expire in february 2023. the wto says they violate international trade obligations.
9:32 pm
to benefit korea, samsung and lg electronics, if the u.s. agreed to eliminate our modern -- modify the tariffs. there and so modi's party is ruling out pledges ahead of the most popular state. they promised if it returns to power, it will -- to farmers. and enact stricter punishment on forced marriages. voters head to the polls thursday. counted on march 10. netflix is a film gained nominations the most for a movie. the western featuring benedict cover patch and kristen dunst is up for best film and best director, among other nominations. warner bros. movie down with 10 nominations. oscars will air on march 27. global news, 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in
9:33 pm
more than 120 countries. i'm vonnie quin, this is bloomberg. rishaad: russia have been casting doubts on french president micron's comments that they will not further escalated tensions. let's get straight to bruce einhorn. a lot of mixed messages coming out of this last flurry of diplomacy. >> it stems from a meeting the french president had with vladimir putin. after that meeting, officials were talking it out, saying president macron had received assurances from president putin of no further exclamation. they later walked it back and said it was a conditional commitment and the situation could change. president putin's spokesperson
9:34 pm
would not comment on assurances about military deployments. troops are scheduled to leave belarus february 20. that is something they have confirmed. following up on his visit with president putin, president macron went to ukraine to meet with president zelensky. now in germany, where he met with chancellor schulz and the polish president. a lot of diplomatic activities. unclear where things go after a bit of uncertain results of the meeting with his russian counterpart. haslinda: what are the options? the goal is to present a war in europe. as far as u.s. congress is concerned, they are divided on sanctions against russia. >> in the u.s., there is action
9:35 pm
on capitol hill to push sanctions now, which is something the foreign relations committee chairman from new jersey is working with his republican counterpart on. those negotiations have been going on for a while. unclear whether anything will happen. even if it gets approved, it will have to be approved in the house. so it will be a while. at into the republican minority leader throwing cold water on this, saying he doesn't think any legislation will have any effect on president putin. he called them president biden to push sanctions. that is where we are on the sanctions front. haslinda: bruce, thank you.
9:36 pm
still to come, a philanthropist and author spending thousand calls to universities this year to show you the strategy on improving education by narrowing the gender gap. this is bloomberg. ♪
9:37 pm
9:38 pm
rishaad: you probably have come across one of the most successful venture startups. the founder has left the organization and wants to close the gender gap and access university education. haslinda: his next big venture aims to provide financial scholarships to promising economically across the developing world. let's bring in the man of him self. >> the venture is called you go. it is a purposeful double entendre. they will go to university, but graduate from university. hopefully being able to join economic mainstream.
9:39 pm
let's get thousands, if not, tens of thousands of women in low income countries into university. haslinda: you talk about how you delayed the focus. if we take a look at what the world economic forum is saying, 156 years at least. how do you expedite the process? >> part of the young global leader program, i'm happy to say we will not wait 156 years. we feel it can be done and it should be done. low income countries get educated, they get better jobs, make more money, and when women make money, they spend 90% of it on their families. food, clothing, shelter, medication. when men get an extra dollar, we
9:40 pm
don't do as well. multiple problems at the same time from the gender gap. companies can have an easier time finding qualified women when they expanded to new markets. we give these young women a chance to educate their family and take better care of their family. rishaad: it is not just about ultimately education. give us a target of how many women you want to send to university. also, you got barriers or you can get a degree, but the norms and values sometimes kick in and they don't do anything. how do you make that move the next step after that, as well? >> i definitely found one thing in 30 years of traveling through the developing parts of the world. parents want their kids to have a better life. when you ask how, it comes down to education. wanting a daughter to become a nurse, daughter, teacher,
9:41 pm
pharmacist, not working in a sweatshop. a lot of these young women, they are scrappy. they realize it is there one big chance for the cycle of poverty forever. we have seen it that my years, the new initiative that these young women will study hard. we will help them by layering and life skills programs to do, whether it is afghan refugee in pakistan, or a young woman in bangladesh. life skills through the life skills program. as well as the career network. internships, connect them up with a job opportunities. the goal is to say to women typically seen as disadvantaged, we will help you be the most advantaged. we will connect you not just with a scholarship, but a powerful network of business leaders coming together, coalescing around this idea. we only launched this week, but
9:42 pm
we have the funding for our first 5000 of scholarship. a pretty nice start. we will go much bigger than that. rishaad: give me an example of -- you mentioned 90% of the money goes back. what have you seen on the ground? >> i have seen so many interesting stories with the scholars. private funding to move on to university. young women have become teachers. so it is going to help the 400 students she can teach every year to learn english. we have seen students from cambodia not only with three of her younger siblings put through university, she built a new home for her parents, moved to
9:43 pm
germany, is speaking german. the oldest of nine children. we have funded nursing scholarships for women in nepal. they are making really good money. and taking care of their family as a result. what is great about education for young women is when you have , it has a ripple effect. not just helping her, her community, but the entire nation. it is what corporations should care about. they have gender goals, hiring goals. if you can help young women go to university, you can take all of those boxes at the same time. haslinda: for more women to go to university, is it also as important to push into areas like stem, where women representation is lacking? >> i would say yes, but i would probably phrase it differently.
9:44 pm
not good if i pushed them, because i'm an outsider. what do you want to do? let us help you do that. in some cases stem, some, nursing. others, pharmacy. they might want to become a teacher. the messages tell us what your dreams are, then let us help you make those dreams a reality. rishaad: what about the global pandemic? there is evidence suggesting it has made a lot of women worse. have you seen that? >> very definitely. we are in an interesting time right now. calm me a glass half-full kind of guy. but universities are reopening. we've had additional swaths -- we're just launching, but we have over 120 young women in vietnam and cambodia starting in the last six months. a lot of demand from ngos to
9:45 pm
bring the program to their young women. right now is a magical time. as universities get back to in person learning, they can layer onvia technology and opportunity to apply for internships. in the next couple of years, it can be a golden time for these young women. we intend to pursue it full on. we've had issues with covid and closings, but we have to be laser focused on this, and be protectively impatient. haslinda: you had great success, reading 10 years down the road. how would you like to look? >> one of the reasons that rendered us successful is recruiting so many people around the world. i did not name it the literally initiative. we came up with a name to attract a lot of people.
9:46 pm
i would like to see thousands of business leaders picking up sledgehammers and going after the last -- maybe not the last remaining, but significant remaining glass ceiling. higher education for young women from poorer countries is a glass ceiling. we will pick up as many sledgehammers as we can. i saw your graphic. $2 million. i'm probably guilty of not having updated. raising over $4 million of funding and we have not even gone public. that is a reason to be optimistic. so many leaders are saying let's attack this issue and do it with gusto and laser focus. rishaad: john wood, the founder of you go joining us. if you're a subscriber, catch up with our interviews by using tv
9:47 pm
. use the chat for instant messages during the live programming. check it out. this is bloomberg.
9:48 pm
9:49 pm
checking the fallout of the global supply chain plunge. these are the top stories. protesters blocking traffic. office supply chains disrupting movement to a key with the trade. how the initial impact is. the situation may get worse. chipotle has cited food inflation wages as profitability. this was singled out as their best dish to help them beat earnings estimates. they might continue to increase it. the japanese government decided to divert from lng to europe in the event prices lead to supply disruptions. japan had only secured enough before sending any to the region. they made a decision at the request of the u.s.
9:50 pm
terminal users can read more about those stories in our newsletter. supply lines. rishaad: getting on the corporate side of things. chose for the global enterprise. the outlook for supply chains. what role does china play alleviating these constraints? >> this whole thing about 2022, most of the outlooks will be 2022 will be like 2021, as far as supply chains are concerned. the wildcard is china. china is a world factory. lowered production based upon covid, energy from the government. think back to the summer games, they cut back production
9:51 pm
dramatically to have less pollution for blue skies. so when the olympics is over, the question will be like the previous years when production jumped, or will it be? from china, we will have stresses of other portions of the system. we will begin to see some relief as far as the supply side. on digital is a, you can see the models have worked successfully. the classic is basically the amazon model, or the apple model. they created a proprietary system that is digitized. supply and demand pretty nicely. earnings are good. stocks are doing well. they did this in a proprietary way. they have resources, money, technical capability. it was a proprietary approach.
9:52 pm
that will change, but that is the role model other companies should really understand. haslinda: and how is china's zero covid strategy going to affect the supply chain system after the olympics? >> you nailed it. that is the challenge. because of the zero covid policy, they have cut back labor and production capability. on top of that, the government has had stringent energy be because of this. so you have the energy targets, that is as far as their ability to ramp up production. we will see if that will change. if the government can change their position on these things and take up production, which would help out supplies. not all of them, but alleviate supply issues. haslinda: talking about china in the past, we talked about
9:53 pm
geopolitical tensions with the u.s. have you seen that decoupling between the u.s. and china on supply chains? >> not yet. it doesn't mean it will not occur. i really don't think -- take the political dialogue or reddick out of the conversation. will these economies decouple? i don't think so. i don't see it is in anyone's interest to decouple the u.s. and china economically. decoupling will occur. but not on the macroeconomic perspective. more on the future technologies, where there is going to be more tension, and perhaps decoupling. i don't think the overall economy, but segments of the technology sector. haslinda: that was sam paul masato. a check of the business flash headlines. fourth quarter sales need
9:54 pm
estimates. fewer than expected due to the spread of the omicron variant. about 19 million active writers. lower than expected by analysts. due to a driver shortage. bank of australia's first have profit estimates thanks to the recovering economy. the largest lender posted continuing operations of $4.75 billion ahead of forecast of $4.51 billion. they plan to buy back up to -- rishaad: having a look at it. looking at the markets in hong kong. looking to lift regional indices. there we go. gains for the chinese market, as well. the tech side of things lifting things. perhaps a little bit immune --
9:55 pm
perhaps a little bit of a move coming through. iron ore futures. nking. down 5.4%. chinese regulators warning information providers against false price disclosures.
9:56 pm
9:57 pm
9:58 pm
9:59 pm
haslinda: it is almost 11:00 a.m. welcome to "bloomberg markets: asia." i am haslinda amin. rishaad: i'm rishaad salamat in hong kong. here's a look at our top stories. treasury yields retreat. asian equity markets bouncing. tech stocks on the hang seng. hong kong may record new covid cases above the 1000 mark as the
10:00 pm
government brings in its strictest virus rules yet. oil getting another big tailwind. going all out to meet annual production goals. haslinda: color to relief. extending gains. asia aipac index up i more than 1%. even as we await the key cpi data out of the u.s. on thursday. investors taking comfort in the fact earnings have come in strong and the global economy looks resilient. outperformer today coming up by 2.7%. being lifted by chinese technology shares on the back of the nasdaq golden dragon index overnight. closing the day up about 4%. the yield story. 10 year yield as high as 1.97%. 1.90. csi 300 index flat despite reports suggesting the national
10:01 pm
team -- so-called national team -- has been coming in to support the stock market. currently flat for the csi 300 index. rishaad: let's have a look at that open in bangkok. thailand seeing the benchmark. at the moment, perhaps following what is going on regionally speaking. interest rate coming later on. under four outs to go before we get the decision. no change expected. might keep the cost of borrowing at .5%. that is what we have read let's take a look at india. rupee study on 74. interest rate decision out of thailand a bit later on. just under four hours. haslinda: let's get more of the
10:02 pm
market action with paul dotson. it looks like investors are shrugging off the national team in china. >> china's markets are not rallying back today. they are not falling any further. i think the intel we got from our market sources was that this intervention was designed to slow the pace of losses rather than to turn the market around. kind of like that old sort of mantra about it is not the declines that are the problem, but the pace of declines. kind of a circuit breaker to give the market time to adjust a little bit. to think about whether the valuations are exactly right. kind of like is there really that much logic for further at
10:03 pm
this point? if you look at the analysis, in previous times, national team intervention has not stopped the market from falling further. in general, one month beyond the time we see it, -- over a six-month horizon, the market intended to turn around and come back. maybe we were getting towards the end of the tolerance level, but we were also getting the end of that selling rush we had been seeing since the start of this year. rishaad: what do you make of what bond markets are pricing in and what equity markets are? >> i think all eyes are on the bond market at this moment. we have seen the pace of losses in that market picking up remarkably over the last week.
10:04 pm
ecb in particular it really called people on that. kind of further increases in yields across the board. a lot of tension. starting to lift. japan holding the line while yields are rising all across the rest of the world. what are the consequences going to be? maybe it is not the bond equity channel we would look at first of all, but the rising rift in credit markets that might be underappreciated. incredibly low in favor of rates, especially compared to all the way through the spike in terms of the pandemic. they will have to adjust to this new reality. and also or borrowing is no longer guaranteed. coming into the credit market. they might be finding it more difficult to find attractive rates for the bonds and loans.
10:05 pm
so just to worry, some companies. especially those without the pricing power. in the u.s., we were looking at them, talking about how prices have risen. that is good. for a company, if it has the ability to pass on those prices. but if it is more constrained, more difficult borrowing terms. that has crimped the earnings potential. maybe it comes back, as well. rishaad: our executive editor for asian markets. let's bring in the deputy chief investment officer. thank you for joining us. let's get a sense of what you make of our question of the day.
10:06 pm
we are asking our guests so far. what is a bond mayor market? are we in one? >> i think we have already been through one. when i look at the bond market, yields going up shows good repricing of economic conditions. 50 basis point in 10 year u.s. treasury to 150 basis points. this already generated a return of 2.3 percent last year. historically, since 1977, u.s. treasury index has never posed consecutive negative returns in a row. there is a good chance we are the go flat. rishaad: how do you actually construct a bond portfolio in
10:07 pm
this environment? is it about wealth preservation more than anything else? >> at the moment, we are looking at the front end of both u.s. treasury and australian government bond yields for some value, even though the central banks would be cost over the year. at the current level, and yields still rise, until fully priced with the hiking rate. the bond should be whole on the front. it is either zero or positive return, very small positive return. when people get investing the 10 year, u.s. treasury around 2%, offering some value that the fed
10:08 pm
can have once a quarter. but i think the case involving it this year. the question of value and momentum are two different stories. we have the new story this year that the ecb is becoming more confidential. using the inflation target around 2%. into marge, and a good strategy will add to the bearishness. haslinda: what exactly is looking attractive right now? for years, they have looked attractive because yields were nonexistent. in comparison, you have the shrinking of negative yielding
10:09 pm
bonds. what is attractive? >> what is looking attractive is the front end of u.s. treasury and government bond yields. so much price into what the central banks will do. if it will pay off risk return buying the current level. you are already likely to buy an asset price in central bank. the terms of negative loss on the front end is quite low. may turn later in the year. haslinda: taking a look at japan, the boj today perhaps not under pressure. how long can the boj maintained its position? >> boj is probably the last to
10:10 pm
have inflation data. having said that, it should be a currently evil -- at the current level, watched in the market right now. these are the levels the boj used to cut into. now it is unlimited. you could control policy. but in the next few months, keeping pressure of, there is a chance they will let them look a little bit and free up the bond. this for global rates, as you said you'd investors in japan may bring money home and investing u.s. treasury. rishaad: thank you very much for
10:11 pm
that, kate. let's go to geopolitics. perhaps a different version of events, or talks. let's get that with vonnie quin in new york. >> french president emmanuel macron with his -- vladimir putin after with the russian leader. moscow said he would not undertake any military initiatives and russian troops from belarus. he declined to comment on reassurances made. >>'s we spoke with president putin. i think that is important. >> china has eased for public housing. policymakers easing on
10:12 pm
leveraging in the property industry. banks have been required to turn loan exposure to investors, but were recently urged to get more of the approvals. they said china also called for more support for affordable housing. the wto sided with korea concerning u.s. levees. tariffs were imposed by the trump administration and are going to end in february 2023. to benefit korean manufacturers. if the u.s. agrees to eliminate or modify them. the u.s. department of justice seized about $300 billion of bitcoin from a hack in 2015. officials have two people in connection with the incident and said they conspired nearly 12,000.
10:13 pm
it is the largest financial ever, and cryptocurrency now the safe haven for criminals. 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. i'm vonnie quin. this is bloomberg. haslinda: still ahead, oil gets another big brian as investors were all out in india. the leader for energy later. hong kong, more than 1100 new cases. details on the worsening outbreak. this is bloomberg.
10:14 pm
10:15 pm
10:16 pm
haslinda: hong kong expected to report more than 1001 hundred coronavirus cases wednesday. at the worsening outbreak to rule out the toughest ever pandemic measures. our correspondent spoke to one of carrie lam's top advisers. this was a big move by the government. he would like to think it makes officials nervous. >> absolutely. it is the fifth wave. it poses a big challenge to their zero covid policies. containing the virus and keeping the hong kong city locked down. the borders are pretty much closed and restrictions out of travel. the restrictions will be increased. including public and private gatherings will be restricted.
10:17 pm
the top advisor to the chief executive convening her cabinet, and he said he's fairly optimistic. very optimistic the city will be able to open up within the next year. the key point is lower vaccination rate of higher, including the elderly vaccinated. also news for the next objective for a shorter quarantine for people arriving, or those infected with close contact. that has been a big concern of the business community. let's get more of my exclusive interview. >> we announcement yesterday, pretty much how to make them. by the end of this month, the 24th of this month, low plate -- most places will require a
10:18 pm
vaccine pass. by the 24th of this month, requiring to have vaccinations for restaurants, shopping, and a lot of other places. that will pretty much be the final drive to push this group of people to get vaccinated. >> you said they would continue to pursue the dam -- dynamic zero covid policy. no main the city has been able to eradicate the outbreaks without total lockdowns, or sealing off particular neighborhoods. is that on the table? will it happen if we get to the projections of some that we can see 10,000 cases per day within a couple of weeks? is a total lockdown on the table possible? >> first of all, it also took me
10:19 pm
sometime to understand the dynamic zero policy. it doesn't actually mean we need to go down to zero. the idea is not that we always have to stay at zero. it is not always possible. what dynamic zero means is doing everything we can to control and contain it. different from the policies overseas were the kind of gave up. so far, our strategy is to contain it. as soon as there is a new search, we will do everything necessary. i don't think we can never go into a full lockdown. we cannot have the same lockdown as the mainland. we will try and contain it.
10:20 pm
hopefully try bringing the number down. but the ejected -- but the objective is not to stay zero. that is impossible. we are pretty much buying time enough to get the rest of hong kong. especially the most vulnerable, vaccinated. until then, i don't think we can afford to overwhelm our health care system. look at singapore. they are reaching over 10,000 cases a day. because they have higher vaccination rate, the hospitalization and death rate is very small. we need to achieve the same sort of path. if we open up now, and our entire health care system will overwhelm a lot of patients, we can't afford that. >> what is the timeframe? when is enough enough? we can't continue going on like this, where the rest of the world opens up.
10:21 pm
what is 90%? are there steps in place we can bet on? >> there are two issues. i don't want to blame everything on those that are unvaccinated. there is still a push to reach 90. had the same time, now that we have enough data, we can try and mitigate the risks better. >> you heard him saying they are trying to buy some time until they can get the vaccination rate up. some epidemiologists say it could last eight to 12 weeks. buying time. rishaad: a lot to look forward to. thank you.
10:22 pm
steve engle. another look at u.s. futures. adding a little bit of optimism. it is including currently. that is a look at manhattan. 10:21 p.m.. we do have futures on the app. this is bloomberg.
10:23 pm
10:24 pm
>> a quick check of the latest business flash headlines. softbank planning an ipo for the financial year ended march 2023. after video poll -- nvidia pulled out of a deal to buy the designer. softbank's third popular showing net income at $252 million and a vision fund returning to a slim
10:25 pm
profit. nissan upgraded his look as strong demand and rising prices help offset chip related productions. they see net income at $1.8 billion for the fiscal year. demand -- and reducing incentives to boost margin. china says its business was significantly affected by covid outbreaks and restrictions and reporter revenue below estimates of $2.3 billion. the company expected 2022 business environment to remain challenging and volatile because of the pandemic, inflation, and softening consumer sentiment. to be cutting the 2021 bonus pool by about 10%. they were forced to reduce variable pay after they consider significant cuts.
10:26 pm
-- rishaad: we are heading to the lunch break. this is the position at the moment. you can see how yields have dropped back. taking a look at what is going on. hong kong leading the charge. covid cases being reported. 1.9% to the upside. tech stocks responsible for the gains we are seeing. green in this part of the world. we also see oil in focus once again. seeing the oil price. really going with what we are witnessing in terms of geopolitics. focus on the trends at cushing. a giant array of tanks. it is the delivery point for u.s. futures. that is where we get the data from wti crude oil.
10:27 pm
huge rally over the past year. and we are going to have that impact. sovereign bonds in focus on the way down. this is bloomberg.
10:28 pm
10:29 pm
>> it is 1129 in hong kong and shanghai. 10:29 p.m. if you are in new york. china's markets going on a break. supported by the national team said to be into support that clamped down as well as the losses we are seeing so far. up about .3%. but maybe they need to do even more here.
10:30 pm
>> they are going for a 90 minute long lunch break. we have a turnaround story. just taking a look at what is going on with the national team as it were. that triggered the overnight rally in some of these chinese u.s. listed names. positivity has been. >> that is right. do a check on where the nikkei to 25 is. this as it comes from lunch break. there is risk on for asia today. we are tracking japan. holding steady. not buying anymore bond sets. at this point in time, it is comfortable with where yields are. even though yields are rising.
10:31 pm
they are going in a higher direction. this is on the back of the nasdaq. they're closing the day up by 4%. all higher but 7/10 of 1%. here is how we are looking in terms of the bond market. they are easing somewhat. the yield at 1.32. we are tracking china 10 years. rishaad: let's have a look at those first word news headlines as we get over to new york and we listen to vonnie quinn. >> hong kong expected to announce more than 1100 new cases. this is prompting the rollout of
10:32 pm
the strictest virus was yet. public gatherings are being restricted to two people. lawmakers in canada have expressed increasing worry about the economic impact of this. they are protesting vaccine mandates. justin trudeau warns the demonstrations are hobbling the economy. , traders say they won't leave until all covid mandates are lifted. pope benedict the 16th is asking for forgiveness for any mistakes made in the handling of sex abuse cases but he denies any personal wrongdoing. he was criticized in the independent report which investigated how sexual abuse cases were handled by germany's catholic church.
10:33 pm
they failed to restrict priests even after the criminal convictions. modi is out ruling campaign pledges. the bjc has promised that if it returns to power, it will offer three -- free electricity to farmers. voters go to the polls on thursday in a months long process that will end on march 10. global news, 24 hours a day on air and on quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn, this is bloomberg. haslinda: russia cracking down on french president emmanuel macron's comments. let's bring in bruce einhorn.
10:34 pm
bruce: president macron met with president putin. after that meeting, french officials said the french president had received assurances from president putin there would be no further escalation. they walked that back a little bit later and said what we really meant was that he said there would be no further escalation near the border. that is still something they walked back. they said it is not that there just wouldn't be escalation but that could still be subject to change depending on what might happen. that is something that putin's spokesman said. as you can see, there was some uncertainty about what really came out of that meeting. french president macron was in berlin yesterday. met with german chancellor schultz --
10:35 pm
tip the medic efforts to diffuse the prices are continuing. -- diplomatic efforts to diffuse the prices are continuing. rishaad: we seem to have an alliance between putin and xi jinping. is it a marriage of convenience? >> i think that from the russian perspective, having china on its side will be very helpful. there are a lot of common issues that china and russia have. the chinese confirmed plans that they will be working with the russians on a joint research station on the moon. they are going to be working together in space and on earth. it does seem like the chinese
10:36 pm
and the russians do have some common interest here when it comes to countering the u.s. and nato. >> that was bruce einhorn on the latest in the tussle taking place. let's look at what we have coming out, we have surging food prices for the major oil importers in india. they are joining us to discuss the current account deficit. this is bloomberg. ♪
10:37 pm
10:38 pm
>> this is bloomberg markets. looking ahead to some of the key stories investors are watching in india. the trade mr. visiting the country to push forward talks on the free trade agreement. we have earnings in the coming hours from the likes of petra net. it all comes as oil refiners in india step up to meet annual production goes, giving oil prices another tailwind. what could this mean for india
10:39 pm
which is still facing a fragile economic recovery? what assumptions are you making about oil prices in the next few months and mark >> we don't credit oil prices. because of the geopolitics events that are happening, there is demand because of the economic recovery. it is coming out of covid. oil is orbiting above 90. india imports more than 85% that they have. >> how much will it hurt and he is economy? -- india's economy? >> india is growing at 9.2%.
10:40 pm
if oil goes up by $10, it hurts india by 2.35%. it certainly hurts india. we will have a lot of challenges. >> indeed. we are seeing oil prices and pump prices flattering. a lot of these prices have not been passed onto the consumer. we have these local elections coming up and perhaps it will not happen. how long can this state of
10:41 pm
affairs keep going? >> you're right. because of the state elections, the oil market and companies are the retailers that control 95% of the market. this is building up on the recovery. the recovery could be in the range of eight to nine rupees. that is a steady increase. this will have the retail inflation.
10:42 pm
>> let's talk about bringing back more fuel subsidies. could this be something that the government will do? >> it is supplied to the poor people. if oil continues to disappoint, the subsidy will come back. it will not become sustainable
10:43 pm
further. >> statement oil companies in india have been benefiting from higher oil prices. can they provide a buffer? will there be more pressure from the government for them to do that? >> in the past, governments have balanced it by asking companies for -- still companies for support. let's stay with oil.
10:44 pm
he is putting it at the doorstep of geopolitical uncertainty. quicktime very proud of them as we look to the future. oil prices, it is always difficult to tell. there is a lot of uncertainty. we have what will happen with the response. we have questions about demand. a lot of uncertainty. i will say that demand is strong.
10:45 pm
you can easily see a further tightening market throughout this year. more than anything i think we should expect some volatility and at the end of the day we don't know what the price of oil is going to be and that is why we are running our company to focus on a breakeven of around $40 so that we are resilient to a range of price outcomes. we don't control it but we do control how we run our business. that is why we are taking -- taking out at $2.5 billion per cost. >> taking a look at how india is opening. they are up for a second day. they are up .6%. this is pre-much in line with the rest of the region. take a look at where we are in terms of some of those plays. they are being dragged by
10:46 pm
high-tech expenses. they are benefiting from new tariffs and they reflect this down .7%. they are a pipe about 1%. this health care get evaluation of $3.5 billion. glenn mark pharmaceuticals is up .7%. we have been tracking oil. and one feature on the bloomberg we would like to bring to your attention -- you will not only be able to watch this live -- you can become part of a conversation. send us is to messages during the live show.
10:47 pm
this is for bloomberg's subscribers only. check it out tv . ♪
10:48 pm
>> this is bloomberg markets.
10:49 pm
¥22 billion in the fourth quarter. that exceeds the outlook. there is revenue for one of his major games, it came away shy. >> we can control other things. we have a lot of fans. if we continue to do that well, we will be well accepted.
10:50 pm
we are very strong. we are founded in korea. we are based and listed in japan. we feel that the western markets are very big growth opportunity for us. it is currently in stockholm with our studio here. we have big ambitions for the question markets. this is japan, korea. >> let's talk about the south korean market. how do you see the metaverse evolving there? especially when it comes to videogame companies and their participation? >> the metaverse term is one of the most undefined terms in the business right now. hard to comment on that. the business we are in is called virtual world. these are worlds that you go to. they are rendered in software and delivered to the cloud from a variety of different devices. your mobile device, your console
10:51 pm
and whatever else comes in the future. we have been in that business for 25 years starting in korea. we have built those two worlds up to be very large. we think it is just the beginning. >> you caution against this idea of prescribing to metaverse visionaries and having to ask the right questions. >> one is a great user experience? what will bring people back? how you go about doing that. what skills do you have to have internally question mark those are the key questions. as builders of those virtual worlds, we are laser focused on answering those questions. we have done that very successfully for more than two decades. we think those are the important things to ask. that question you just asked his not raised nearly enough in our view. >> that was the next on president and coo.
10:52 pm
we know it is really about the earnings. looking for strong earnings to justify gains. look at some of the earnings here. take a look at japanese companies. about half of the 225 companies on the nikkei 225 have reported earnings. this was not just oil but metals as well. as well as agriculture. if you take a look at financials, this has been pretty disappointing. they are hosting the biggest of social prose. >> we are looking forward to automotive. also, we have toyota bit later on as well. a look at how they are doing and what the supply crunch is actually doing for that business
10:53 pm
affected. that will keep the automotive theme going as we go to the latest business flash headlines. we have fourth-quarter sales beating estimates. they reported fewer riders than anticipated. the company sing about 19 million active riders. sales boosted by a higher fed, a driver shortage and a doubling in airport rides. the prophet topping estimates covering the economy there. this is continuing operations. there are more than a billion aussie dollars. the bank also planning to buy back to billion of his stock. this would build the multibillion-dollar chemicals complex in china.
10:54 pm
this is in the northeastern province. talks are on this. let's have a look at the shares of this cybersecurity firm. this was an acquisition target of microsoft. microsoft is in talks to buy the company and would do so in order to bolster efforts to protect customers from hacks and breaches there as well. >> the outperformer right now. those tech companies are listed here.
10:55 pm
alibaba was in outperformer. they may not be in sight. take a look at where we are. it is really about the bond markets. they have 10 year yields surging past 1.97%. that bond about easing some.
10:56 pm
>> a lot of these are looking quicker. they are looking at that. we have a lot to play for. ♪
10:57 pm
10:58 pm
10:59 pm
11:00 pm
>> from the heart of where innovation, money and power collide, in silicon valley and beyond, this is uber technology with emily chang. >> i am emily chang in san francisco and this is bloomberg technology. telethon has a new ceo but still , shares are riding high on the news. more on the massive shakeup.


info Stream Only

Uploaded by TV Archive on