tv Bloomberg Markets Asia Bloomberg March 17, 2022 10:00pm-11:00pm EDT
policy settings unchanged to fight inflation -- despite inflation rising to a two-year high. we are seeing equities change a little, subdued mental coming through in these markets but what a wild ride it has been for asian equities this week. we are on track for our first weekly gain in five weeks. a little weakness coming through in hong kong. i will get to those players in a moment but we are focusing as well on the miss messages -- mixed messages on russia and ukraine, it has pushed uti crude up. rent holding at 109 a barrel. this going into the players, a front runner up by about .4%. let's look at what is happening in the hang seng tech index, a solitude a rally but paring back after we saw weakness coming through in the chinese adr. how much support is there for this market? are we going to see
firm action coming through after receiving word from beijing, investors waiting to see policy action following up. this is been such a big rise for this index, still off by about 50% from february 2021. rishaad: yeah, and right now stocks in hong kong are heading for a 3.5% gain this year. that's also afflicted in the regional index, up 3.7%. what we have at the moment are lots of rate decisions in the past and want to come this morning. the bank of england hiked rates by 25 basis points, a dovish hike. turkey holding as well. taiwan hiking rates the most it has since 27 -- 2007, 2.37%, worse than what they had before.
looking to japan, we've got the bank of japan coming out with its rates, we do have inflation nowhere near anywhere else but rising, the fastest clip in two years. it is a sign the economy there is perhaps not immune to the strengthening inflation we are seeing around the world. that is a look at what's going on with regard to central banks, looking out for the bank of japan this hour and perhaps the next. juliette: it is really leading into how market sentiment change. it is a more subdued session today, but look at this chart, showing you the msci all world index in terms of the other index. we have seen the biggest flip from fear to greed in the last decade and the last two times we saw this, we saw the world index return 17% in the 25% in the three months following. perhaps positive momentum that
we will see these rallies continue. will get that with all of our guests and their thoughts shortly. karina: going straight to tie way, -- rishaad: getting straight to it. great to have you on the program. it is exhausting, a real roller coaster ride. what have you made an what does it tell us? there is a certain amount of brittleness we have among investors. we've also seen the greed vic's indexes well. >> there's a few things. there's been a lot of bad news in recent weeks in terms of ukraine situation, which is terrible, but the same time i think the global macro economy has some uncertainties and with the fed looking to raise rates, i think the key is a lot these uncertainties are starting to be addressed so we know what the fed is thinking in terms of policy, the rates over the next 12 to 18 months. we are starting to see some
degree of oil and energy markets settling. whether there are more disruptions remains to be seen, we have established some kind of range and then china on wednesday came out and acknowledged some of the challenges facing the market and pledged to do some thing about it. all of this depends on what china and beijing is going to do in the next weeks and months in terms of addressing issues, but all of these are giving investors a little more of a direction of where things are going to go. from the perspective, i do feel the global economy is still on track to positive growth in 2022. that would translate into a respectable earnings growth. i think that is partly why investors are starting to feel more optimistic when it comes to risk assets like equities. rishaad: on the one hand, we have solid earnings and prospects for this year, but we can't ignore the specter of inflation.
stocks do well when there's inflation but this has come out of left field given zhou put issues. how do you navigate that? >> a great question. it can go both ways. for consumers it could put pressure on costs. i think that's where asset management becomes important, right and if i companies who are efficient, have good control and a strong leverage in order to benefit or be resilient in this phase of inflation. we did see commodities perform really strongly during the run-up in oil prices. from that perspective, it is important to recognize that some sectors are more resilient in a high inflation environment. some are going to be struggling more and the key here is if the sectors will do well. a couple of areas i see are looking quite promising can't technology and health care traditionally are less impacted by higher costs, but at the same
time, manufacturing and production of downstream businesses tends to get more pressure from higher costs. i think all in all there still a strong case for risk assets, especially the fact that government bonds continue to be expensive and risk of bond yields are on the upside. juliette: let's get your thoughts on china. there was a jp morgan call it the chinese assets were on investable and we saw a turnaround. it is hard to keep up and investors want to see action followed up with those words from beijing. jp morgan's thoughts on china, is it on investable? -- uninvestable? >> i don't think so. there are still long-term opportunities coming from china. the internet platforms are going to regulatory changes and we hope to see more clarity. but there are other sectors in china, when it comes to
renewable, decarbonization, a potential rise of more middle income group in the next five years, that will continue to drive the chinese economy. i think we need more clarification because as i mentioned earlier, we have recognized the problems and challenges, pledged to address them, the next phase is going to be how authorities implement the solution, whether it is negotiated when -- negotiating with u.s. authorities or how they're going to head the covid situation. juliette: that is also playing through into those ambitious growth targets as well. what else are you recommending to your clients amidst all of the concerns we are seeing at the moment and they war in ukraine in particular? tai: i'm optimistic on asia for a number of reasons. especially in southeast asia where markets underperformed for 2021, it has been resilient in
2022 for two reasons. valuations are still attractive and they are looking forward to the prospect of reopening from many of these markets, which the service sector have come under said nick and pressure for the past few years. so from that perspective, the ability to catch up from southeast asia and the rest of asian economies and domestic consumption i think will be an opportunity. rishaad: is this the time to load up on tech shares given where they have gone and not for the short-term but long-haul? tai i think in the long haul,: yes. as we discussed earlier, there are still uncertainties regarding the status and where the authorities are going to go with this regulation. so it is not perhaps you're going to invest all of your allocation in monday, but i think over the next six or 12
months it is worth looking into some of these tech sectors. and we will get more information on how these tech companies handle all of the regulation changes the earnings results if they prove they are able to withstand all of the changes and be able to adapt and change, i think they will give them more attention, but it is important to recognize these are still high volatility areas and it will work for some of the more structural growth areas in china. juliette: always a pleasure, joining us, tai hui. let's get the first word news with paul allen. paul: the u.s. warns that clinton could threaten nuclear weapon use as the wharton ukraine goes on. the pentagon says moscow is using its weapons arsenal to project russian strength.
there are major progress in cease fire talks ukraine, blaming kiffin -- kyiv. the latest sign the japanese economy is not immune to inflation even if it remains below the target. prices excluding fresh food rose 0.6% year on year in february, largely driven by rising energy costs. boj will announce its policy decisions in the coming hours and will keep monetary stimulus unchanged. persons of up to 12% after futures plunge by the maximum for a second day. prices drop at a previous 8% limit on thursday after another glitchy start to delay the open. nickel futures have dropped to 58% from highest reached on march 8. only a few contracts have traded due to a lack of buyers. the former president of peru
will be free from jail where he was serving 25 years to life for human rights violations. he restored a human shery ahn pardon granted in 2017. he was jailed for atrocities committed during a war with maoist rebels in the 90's. 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 paul allen. this is bloomberg. jonathan: -- juliette: we are getting clarity on the upcoming call would president biden and xi jinping at 9:00 a.m. eastern time, 9:00 p.m. in singapore and hong kong. in the morning we will see this part of ongoing efforts to maintain open lines of commit occasion according to the white house between the united states and the prc. they will discuss managing optician between the two countries as well as the war against ukraine and other issues of mitchell concern. this will be closed press.
it is the first time we have seen the presidents talk since there four our four -- four-hour call in november. rishaad: just under 11 hours to go. coming up, xi jinping pledging to reduce the economic impact of china's covid zero policy. will speak to the founder of one of china's biggest private hospitals. that is on the way. this is bloomberg. ♪
increase in civilian casualties and refugees. the first thing now is to call from maximum restraint from all parties and ensure safety and security of all civilians including women and children and meeting the basic humanitarian need to prevent the occurrence of a larger scale humanitarian crisis. >> this is an opportunity for president biden to assess where present xi jinping stands. there has been they absence of clear rhetoric or denunciation of china -- by china of what rush is doing. it speaks volumes not only in russia and ukraine but around the world. rishaad: president biden going to pressure xi jinping to take a tougher stance against the war in ukraine. they will speak on the phone friday at 9:00 a.m. eastern time, just under 11 hours from
now, the first time they will have done so since the invasion. we've already have the russians and chinese have a meeting. this bring in our asian government manager. these talks will center on ukraine and mutual cooperation. what does biden want from xi? dan: biden wants a declaration, assertion or reassurance that china is not going to provide financial and military assistance to russia and the war on ukraine. china has in recent days recalibrated their stance on ukraine to appear more neutral. we have seen their ambassador in ukraine repeat a promise that china would never attack ukraine , which suggests that they would not also provided weapons for russia to attack ukraine. but biden wants to hear that
from xi jinping himself on where he stands. from the chinese side, they are very wary of being seen to have their foreign policy dictated by the americans. so that in some ways accounts for a lot of their hesitation on this. but we have not seen full-scale support of russia or assistance. some state run companies have been very cautious about dealing with rush this time. juliette: we know this the first time they have spoken since november. a lot of guest pressure here for this call. is it likely to bring anything meaningful? i know it is obviously a diplomatic movement, what do you think it's actually going to be achieved? dan: it remains to be seen. u.s. china relationship has been at a stalemate since biden came to office. he kept a lot of trump's policies in place.
we have not seen movement on any of the major issues, tariffs, sanctions, export controls. you name it, there has not been a lot of progress at all in these substantive issues left over from the trump administration, and in part that is because there is a bipartisan consensus in the u.s. to take a hard line on china. it is unclear if the current crisis in ukraine is enough to wage them out of that stalemate and allow them to actually make progress on some of these wider issues that have been hurting the relationship. if you look at how china has been supporting russia, a lot of the issues they are supporting russia on her issues that it has with the u.s., including wariness about alliances, wariness about a nato like block in asia for instance. so fixing this relationship could go a long way toward
underpinning stability between the world's biggest economies. juliette: asia government managing energy or -- editor dan ten kate. jp morgan has process dollar bonds issued and sent to citigroup, they are saying russia is highly vulnerable to nonpayment. catherine joins us from singapore. what is the status of the russian bond coupon payments? >> the money is according to people familiar with the matter with citi. bloomberg has not reported that it has reached any bondholders. the clock is ticking on the default. rishaad: the question has to be,
have people received, investors reshoot -- received any money? the clock is still ticking on a default. catherine: correct. merck has not reported that investors have received their money. according to people familiar with the matter, the money is with citigroup, although jp morgan and citigroup have declined to comment and of course as you said, the s&p has warned that the technical payment difficulties are exacerbating the risk. they also have the russian corporate debt rating overnight again. juliette: what about russia's corporate coupon payments? do we know if they are going through?
catherine: a bunch of gone through, but this remains another issue. exactly how these government coupons are the tip of the iceberg, and how there is a much bigger sum of money, $150 billion, that is going to work its way from -- to investors. rishaad: thanks for that, asia credit team leader catherine bowes late from singapore -- bosely from singapore. the rest of that is on the terminal. your market rundown in one click in this commentary coming from expert editors. this is bloomberg. ♪
about .24%. china's largest insurer by market value sought new income to $16 billion last year. the company's performance dragged down by impairments on its investment in china fortune land development and slumping at the live insurance, which generates most of its revenue. shares falling after concerns about a gaming license for the casino. the company took payments for hotel rooms on chinese debit cards and transferred money to gambling accounts. similar money-laundering issues have led to have arrival in casino have its license revoked. facebook's rival suing it. they add which promoted cryptocurrency investments lead to a media articles.
australia's richest man is also suing meta. rishaad: was look what is going now. looking at some of these interest-rate -- industry groups. we saw property stocks up 16% in the session thursday. they are heading in the other direction right now. it was downgraded three notches by the s&p and the rating is a b minus. it is in talks now with it private bondholders and the shares are off the lows of the day but felt 10.5% on the downside. write down for property companies after the surge, we saw a look at some the technology companies as well. alibaba amongst them, seeing with their up to and the chinese merchant bank as a comes up with results later, two point 7% down, alibaba nearly 6% fall back as far. they are keeping tabs on the bank of japan. expecting the central bank to
keep policy on hold. stay with us for that. this is bloomberg. ♪ at xfinity, we live and work in the same neighborhood as you. we're always working to keep you connected to what you love. and now, we're working to bring you the next generation of wifi. it's ultra-fast. faster than a gig. supersonic wifi. only from xfinity. it can power hundreds of devices with three times the bandwidth. so your growing wifi needs will be met. supersonic wifi only from us... xfinity.
electronics makers and service providers. we have the yen just halting its streak of losses. of course, all of this as we await the bank of japan. juliette: down to the policy decision, it could come any time now. kathleen hays is waiting and watching for us. a lot of focus on inflation, and as i mentioned, the yen. what do you think we will hear from the boj? kathleen: we just had that inflation report from japan showing prices rising at the fastest rate in two years. it is still far from 2% but getting closer and we know that for years and years, the governor has wanted to get the
key inflation rate up and keep it there. if you take out fresh food prices, which is bank of japan's key measure, the number was 0.6% year-over-year largely due to rising energy prices. there's a big question -- what kind of message will we get from governor kuroda on his view of inflation? remember how jay powell used to say it was transitory and realized it is no longer that? governor kuroda insists, and he may be right, there is a japanese economy in a very different place from the u.s. economy -- in fact, he told parliament he does not think inflation will reach two point -- 2% in a stable manner so stimulus must continue. stepping back, i think what people are waiting to hear is what is the boj's outlook for inflation, outlook for growth? the ukraine war, the virus not
going completely awake yet, the major earthquake this week. how does that affect their sense of what gdp will do? we had a third quarter that was negative, and second quarter that was positive. what is the economy doing now? there's all kind of questions here. bottom line, no policy changes. i think that is the question -- what do they signal about where they think things are going? rishaad: of course, the yen is going to be a topic here as well and its weakness. of course, the weaker yen was one of the tenants of abe-no mics, but what does kuroda make of it? kathleen: that is what is so important now. we just saw the dollar not quite to 1.2, but i think that is a level people have gotten very nervous about, and the speed, look at the timing of this -- it
has been recently moving so quickly. this could have a lot to do with the fed making clear they are going to hike rates, so why wouldn't the dollar strengthened and the yen we can, for as much of a haven as it has been recently? one of kuroda's critics says right now, this week yen is becoming unpopular with the japanese people. it makes things more costly for them. he says it will erode their quality of life. he says the bank of japan staff might not agree with governor kuroda on this, that there should not be steps taken of some kind. he also thinks that governor kuroda is going to stick with this idea that you don't see wages rising along with this rising inflation, you don't really have to worry about inflation. it is going to come back down, but i think what people are looking for is did governor kuroda come at this with a little more caution?
just acknowledge that it is week and some of these forces are transitory and will not last but not give it that same kind of abe-nomics seal of approval. rishaad: thanks, kathleen. right, the specter of default hangs over russian bondholders. let's have a look at that. paul: sources say jp morgan has processed interest payments from dollar bonds issued by the russian government and put the money to citigroup. we are told jp morgan received approval. analysts say it could take a technical default off the table for russia, the questions remain. president biden and she -- and xi are set to hold their first call since friday and there are
concerns beijing could help moscow evade sanctions or even provide weapons to also discuss competition between china and the u.s. the bank of england has tempered itself or further rate hikes after lifting its rate hike for the. the hike was backed by eight of nine policymakers. governor bailey soften his wording on more hikes. the boe is the first major central bank to bring rates back to pre-pandemic levels. taiwan's central bank has raised its key interest rate by the most since 2007, lifting it 25 basis points to contain rising inflation. this is taiwan's first rate hike since 2011 and the first time it has changed rates since early 2020 when it made a cut at the start of the pandemic. meanwhile, indonesia's central bank held its rate as expected, keeping it at a record low.
rishaad: the type and look at the london metal exchange. it is saying it will allow price moves up to 12% after futures plunged by the maximum allowed for a second straight day. let's take a look at what is going on and bring in james thornhill. walk us through how this trading day unfolded on thursday and what the prospects are for moving ahead now as well. james: sure. it was another chaotic day. the initial start of trading was delayed. some initial trade at the lower limit was put in the system but recognized. the market did close down, as you mention, 8% set by the lme
yesterday. they are trying to bring a bit more into market by placing these limits on the market. as you say, it has lifted that limit and the price being seen on the market is still not reflecting the reality out on the streets. that is also reflected in the fact that in shanghai, -- there is plenty of nickel being offered, it is just no one wants to buy at the current levels. it is still a matter of price discovery. i think we are going to see another drop, probably that 10%, 12% limit. haslinda: what is the impact for the broader commodities complex? what does it mean for the future of the exchange itself? >> sure, well, yes, on the one
hand, since the format has been very limited to nickel in terms of the lme, other base metals are finding some support from moves in china. they are focusing a bit more on those fundamentals, and of course, the conflict in ukraine remains an ever present consideration for the market, putting a floor under commodity prices and the fear that russian supply will continue to be absent from the market. as you also allude to, --
gains not being recognized. the market is still working its way out. the lme has still got problems sorting out distance between buyers and sellers. we still have not got a price that is accurately reflecting the market, so this has brought into question the lme itself and if the organizational processes are correct, and it could be the need for reform, so we will watch that going forward and certainly, nickel will be very much in focus and if they can bring order back to that market. haslinda: thanks for keeping us up-to-date. we are getting some lines coming through from reuters about tesla restarting its output at its shanghai plant after a stoppage we had seen. tesla having this two-day suspension according to people
familiar as movement controls as part of its effort to curb the latest covid-19 outbreak. we are hearing that the shanghai factory has restarted its two-shift production from 7:00 a.m. local time. coming up on bloomberg markets: asia, we speak to the founder of united family health care, one of china's biggest private hospitals on how the recent outbreak is affecting business. that's next. this is bloomberg. ♪
haslinda: chinese president xi jinping has pledged to reduce the impact of pandemic-fighting measures, signaling eight week two china's zero covid strategy. let's discuss that and more with the founder of one of china's biggest hospitals. great to have you with us. we are seeing numbers at their highest since the will hand outbreak two years ago. when you hear there will be a pivot away from this policy or at least a little bit of a relaxation, what do you think? is it concerning the system might be a little overburdened? >> i think would have seen
perhaps the peak of omicron earlier this week when we had a high, like, 5000 cases. by the end of the week, by today, it is almost half that number, so i'm glad to see that cases are attenuating, and the cases that exist are very focused clusters. when you compare them to almost any other country in the world with much lower populations, i think we are already doing pretty well. on march 15, you are absolutely right, the ministry of health came out with a new set of guidelines for covert diagnosis and treatment, and i think those guidelines signal a loosening of some of the very harsh approaches, and this was enabled by the fact that we now have two years of experience of dealing with a virus that we know much more about, and also with a very
well vaccinated population. with the omicron strain being a little bit less lethal and also having more tools at our disposal like the newly approved pfizer therapy as well as the domestic therapy as well as some ttm approaches, i think we are feeling quite confident. in addition, new guidelines are allowing lower-level hospitals to use antigen testing rather than sending every suspected case to the covid treatment hospital. that way, we will be able to reserve this for potential outbreaks. haslinda: that is the change in the pivot we need to see. as you mentioned, there are antivirals, tests, vaccination rates as well that we will think about. do you see, i guess, a complete
pivot away from dynamic or covid zero in china? >> i think that dynamic covid zero is already a step toward a more open policy, and these new strategies will help us, i think, to step-by-step get to a more -- closer toward a living with covid kind of policy. i'm hoping we will continue to see steps in the right direction , and if we see the other countries who have started their complete living with covid policies be able to keep things contained, it will be a sign of even more confidence to go in that direction. i'm hoping that will eventually lead to even more open borders. rishaad: they've got to relax it at some point, haven't they? if the rest of the world is actually living with covid and they have zero covid as a
policy, they will never open up. what about the efficacy of the vaccine that is actually being used? >> i think we have learned that even the chinese vaccines have lowered the lethality of covid and help people get along with lighter symptoms, and, you know, i'm sure that they will continue to improve vaccines and there's even now a local, domestic rna vaccine there in clinical trials and we hope to see that soon. so, yes, we have a -- [crosstalk]
rishaad: i want to get a sense of we have seen these regulatory crackdowns take place. educational technology, we have seen tech companies as well. are you concerned about private hospitals falling under the radar power falling within the radar of authorities in china right now? >> we have seen since the introduction of new health care reform in 2009 and again the healthy china 2030 strategy paper as well as almost yearly continued pronouncements and strategy papers and ministry of health very strong support for private health care. i think the government has shown its determination to encourage the development of private health care and in fact, over
50% of the health care institutions in china are private. we are servicing over 20% of the pace needed here, and the government continues to pronounce the importance of the contribution made to the overall health care system by private health care while continuing to count on the public system to deliver overall basic care, so i don't think that is a worry or a risk, and although one might leap to that conclusion, the government has continued to reinforce as recently as two days ago that public markets will continue to be open to chinese companies, and that will include health care.
>> tell us a little bit about your own company. i know you are on track to open a hospital in shenzhen. how is that going, and i guess the impacts you are seeing as we see this omicron wave, the impact to your hospital system. >> united family has been delivering high-end internet small care services to communities in china since 1997 when we opened our first hospital in beijing. we now have hospitals in six cities. 10 hospitals including an internet hospital and almost 20 clinics. we have a broad lap form for the delivery of comprehensive health care in china and in terms of how covid has affected us, we have since early days had some curtailment of care because --
yes, some curtailment of care, but since 20/20, we have been operating as always and in business for complete operation. over the last two years, our business has grown substantially and we have opened two new hospitals. we are getting ready to open a hospital in shenzhen, which will be a large hospital, and we are excited about that because there is no high-end private health care available in shenzhen as yet. yes? rishaad: we have run out of time. we just want to thank you so much for joining us. very interesting insight into what is going on in the health care system in china. if you are a bloomberg subscriber, you can catch up with all our interactive news using interactive function tv
rishaad: bank of japan downgrading its overall assessment of the economy, keeping rates on hold. let's get straight to our global news and economics editor kathleen hays. kathleen: this was pretty much expected. the boj was not expected to change its policy tools. if anything, some days, people think they might actually remove stimulus, and right now, there is so much hanging over the japanese economy because the virus is not gone. third quarter gdp was negative following one positive gdp number, so people are waiting for the fourth quarter, so what is happening now? ukraine war is pushing up commodity prices and that pushes up inflation, but as every other central banker in the world says, it also hurts consumers, and that is something that japanese economists are worried about as well. in the press conference a few hours from now, that is
something governor kuroda will surely be asked about. haslinda: i'm just looking at my terminal now, a little bit of movement. obviously this has been a huge factor for the boj, too. kathleen: it is a tricky one. if governor kuroda -- first of all, if he gets cautious about it, a little more concerned, how would currency traders react to that? it is hanging out there. i would be surprised if anything comes out further from there, there monetary policy report that mentions the yen directly, but he will surely get questions about that, too, at the front conference. as a former boj board member who has been critical of kuroda for some time, said this is hurting the japanese people, it is getting some criticism aimed at the bank of japan. that is something corroded is going to have to answer. haslinda: a couple of minutes to get across and join us again. kathleen hays following the latest from boj and you can also
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>> from the heart of where innovation, money, and power collide, in silicon valley and beyond, this is bloomberg technology with emily chang. emily: i'm emily chang in san francisco in this is bloomberg technology. with russia's invasion faltering, could prudent be about to get more brazen? even make a nuclear threat? a security expert says it is time for a no-fly zone.
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