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tv   First Up With Angie Lau  Bloomberg  September 24, 2015 7:00pm-8:01pm EDT

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♪ angie: it is still combing. -- monig. -- coming. janet yellen says that it redirected still combing. is out there somewhere. from indonesian forest fires hits hazardous levels with schools being closed. welcome to "first up," item angie lau -- i am angie lau.
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janet yellen as a spoken. let's check in on markets in asia. new zealand is climbing, check out the dollar spot. kiwi is-- the weakening. we are counting down to the openings in australia and japan and korea. let's head over to japan. this was the news after coming back from the holiday break. it played catch-up. futures in chicago pointing to a quiet open, four points to the upside, very fractional. but dollar yen, check it out, weakening on the u.s. dollar strength. no trading in india and the philippines today. markets are closed for national holidays.
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the top story right now, janet yellen says that the fed is on track to raise interest rates this year but that the plan could change if there are economic changes. the dollar strengthened after the comments. let's take a listen. janet yellen: combined, these judgments show that the interest consistent with achieving and maintaining full employment in the medium run should gradually rise with time. this expectation, coupled with in the response of real activity to inflation and changes to monetary policy are the key reasons that most of my colleagues and i anticipate it will likely be appropriate to raise the target range to the federal funds rate sometime as we continue
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boosting short-term rates at a gradual pace thereafter as the labor market improves farther and inflation goes past the 2% objective. angie: for all of you watching the speech, it was an uncomfortable last few minutes. janet yellen caused several times towards the end of the speech and needed to be assisted off of the stage. -- caused several times towards the end of the speech and needed to be assisted off of the stage aused towards the end of this speech are needed to be assisted off of the stage. an aide said that he was dehydrated. su keenan has the roundup of the action on wall street. su: we can tell you that it was arefensive market, many waiting to hear from janet yellen, the fed chair, to perhaps give clarity on the fed
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position. she lostfocus is that her place several times, there was some concern it appears as we are being told unwarranted. s is yet another wrinkle in ome of the focus on how the fed chair is communicating the fed's aim. that is tending to add more volatility to the market. flat,now s&p futures are indicating that the incident is minor. i think the way you will see the market play tomorrow will give us a better idea in terms of how do thursday such an ended, -- how about thursday session ended, lower across the board. questof investors on a for clarity. the friday session will provide clarity on what we have learned. let's talk about the economic it up. durable goods fell 2%.
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separate report shows weekly claims for jobless benefits rose somewhat less than forecast. to homeher measure sales rose 5.10% last month stronger than forecast. the rebound is stronger. 4% vix rose more than thursday, a sign of the volatile times. in terms of the stocks in focus, they again point to why investors are concerned about slowing growth. toliburton cutting 2000 jobs .a lot of the job cuts are coming in the north american region which has been hard hit. we saw shares down 2.5% before erasing of the lost before close. -- loss before close.
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caterpillar, the same story. this after saying they will cut 10,000 jobs over a four-year period. biggest maker of mining and construction machinery. the biggest maker of mining and construction machinery. that is the latest on the market. unusual event with venture janet yellen, it appears that everything is fine and we are setting up for a normal friday session. a side of the hyperfocus that is now on any comment coming from the fed and any action related to the fed policymakers. concerning tovery watch. thank you so much for that. su keenan out of new york. let's check other headlines. in afteres are surging our trading. -- hour trading. the ceo has been expanding the
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product line and all my operations. the outlook for the -- and online operations. the outlook for the immediate future looks bright. japan tobacco might be looking to expand to the united states. about the company is in talks to buy assets from reynolds for $5 billion. sources said the deal might include parts of the american spirit brand. talks are said to be an advanced stages but the deal could fall apart. japan tobacco has been on a buying spree abroad. has shut down primary and secondary schools on friday. in the early hours of this morning, the index of the highest level of this year, reaching the hazardous range. at these levels, the public is advised to minimize and/or activity. the smog caused by forest fires
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in indonesia has caused them to cancel outdoor events and flights have been bundled across southeast asia. the chinese president will meet president obama just about one hour from now for a dinner at .he white house cyber security and a list of other disputes will be on the top of the agenda. ,ur white house correspondent the husband following the visit has been following the visit and joins us from washington. has indicated he is willing to cut a deal on cyber security. >> that is very true and we have to remember that president obama has he raised the -- raised the possibility of sanctions. they are ready to talk about having a framework agreement to govern cyber activity and forget future breaches and problems
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between the countries fred this has been a point of contention -- countries. this has been a point of contention in regent we -- recent weeks. angie: what else will be in focus for these men? ouse: there are several points of consumption, everything from the chinese economic activity and the stock market which has been volatile. will talk about things like currency devaluation and currency manipulation. there are perennial issues like human rights and the chinese activities in the south china sea. those are issues that the u.s. wants to bring up. things like climate change, the two countries that are the largest emitters are hoping to get an agreement. angie: how do the private dinners differ from formal meetings? what does it give them a chance to talk about? >> president obama definitely likes the private dinners.
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fewer people, they can meet i do tom discuss visions -- eye and discuss visionseye. obama very much like sleeves and thinks it is a way to get the ball rolling on policy discussions by sitting down without an agenda and talking points and discuss the major topics of the day. angie: candid conversations at these private dinners. what will they bring? touluse. so much, thank you so much. housecleaning has started at volkswagen as the carmaker tries to rebuild its reputation after admitting to cheating on u.s. pollution tests. a decision on the next ceo is imminent and the entire auto industry is feeling the effects. shery ahn has the details. who is expected to guide vw through this? sherry: his name has been thrown
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around but we are hearing that the head of porsche is emerging as the front runner to succeed martin winterkorn as the next ceo according to a source that is telling us that he is backed by the family that controls bw not to mention the carmaker's labor leaders. he is also a company veteran and has been there for four years and the board is expected to pick the next ceo. byy are expected to be side today. of course, all of this comes after the company lost $22 billion in market value after this cheating scandal broke. sources are telling us that it is not over. look at that plunge in a couple of days. we are hearing that audi and porsche's chiefs could be let go with sweeping changes coming at
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vw. angie: that is vw but i do not think it is about vw. the entire auto industry is under scrutiny. re of the issue is software which is essentially to defeat emission tests. bs, in tests, they would meet emission standards but in the real world they would put out 10-40 times the legal limits. the union has urged member countries to carry out an investigation. the european commission spokeswoman is saying that we ull picture of f how many vehicles certified in the eu had the devices. already this is threatening the reputation of rivals such as bmw, the stock plunging overnight. we saw a plunge in frankfurt after a magazine reported three
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suvs were not meeting european emission standards. did recover after the magazine clarified the report, saying there was no indication the carmaker manipulated emission tests. automaker european lobby group is shooting back, saying there is no evidence this is an industrywide issue. angie: shery ahn, thank you for being on top of this for us. roseg up next, the dollar after the fatah says that a rate hike this year is still likely. we discussed the broader impact discuss yellen's -- the broader impact of janet yellen's comments. after the break. ♪
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angie: checking stories making headlines across
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the world, the saudi king is reviewing security after 730 people are killed near back up. 900 others were injured -- mecca. 900 others were injured as people gathered for the last major ritual of the hajj. the names and genders and nationalities are not clear but iran says that 93 citizens died and that the saudi government must take responsibility. two weeks ago, a crane collapsed at the grand mosque. a chinese woman wanted by beijing as a part of a bribery investigation has been repatriated from the united states. the state media says that kwan is the wife of a former official of the bank of china who served a prison term in the u.s. for money laundering. she is the second person sent beijing launched a campaign to return suspects of economic crimes. the u.s. does not have a formal
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extradition treaty with china. mr. looking government says the abduction of three foreigners from an island resort is an isolated -- the philippines government says that the of the action of three foreigners from an island resort is an isolated incident. they were kidnapped at gunpoint. arrivals have picked up in recent years and authorities got the upper hand over islamist and communist rebels and armed groups. l, investors looking for further guidance from the fed got it today. janet yellen said that the rate increase is on track for later in this year and the dollar is rising. we are joined live from los angeles. this was an anticipated talk from janet yellen because the criticism of her at the press conference was that she m
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uddled the message more than she clarified. do you think she clarified today? >> i think she did and the markets will be pleased. markets do not like uncertainty and they wanted the increase last time. it is interesting that she did not spend time on international markets which have created a sokup so i am not -- hiccup i am not surprised that futures are indicating an increase. expectshe says that most the 2015 left off so the brief reprieve that we had earlier in is what should the markets expect? going to bes are concerned about a strong dollar which has hurt exports. what is interesting is that small caps and small businesses are doing well.
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2% gdp growth rate, unemployment at 5.1%, really the only head wind right now for the u.s. is the strong dollar. that will continue to be a concern for the multinationals that the markets will see through that. angie: how are you advising investors with the ve above level.voix above the 20 volatility seems to be the name of the game. how are you advising your investors? irk: if you look at the five year history, it is usually an inflection point. i do not think this is a rerun of the credit cycle problems from earlier on. i like the developed markets versus emerging markets. i think the u.s., especially in small cap, will do well. we look at great growth companies, names like visa, disney, netflix, amazon, there
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are a number of stocks that are up, quite a lot for the year. when the market returns, it will favor growth. to be carefulue about the commodity exporters and the emerging markets. i like countries like india and japan which will benefit from low oil prices but i still think the. volatility of the emerging world will continue -- the volatility of the emerging world will continue. angie: private gun a right now between obama and president xi -- private dinner right now between obama and president xi. how will that affect things? the market will be attention and look for signs of physical using. fiscal interesting -- easing. what the market would like to see is a fiscal stimulus and
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china continuing to stimulate the domestic economy. as i said earlier, i think eyes will be on premier si. -- xi. angie: thank you for joining us out of l.a., wells capital management. coming up next, schools and singapore are shut down because of air pollution. we have the latest when first up returns. ♪
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angie: just one match in the rugby world cup overnight and the defending champions have overpowered in the match in london. the all blacks landed nine cries in the defeat, one of two african teams in the tournament. after starting with a traditional, new zealand took six minutes to run in the first five pointer and by halftime lead 34 points to six. the champions were too strong for a namibian team with part-time players. by scoringted fans in the second half. the all-black were sitting pretty at the top of poolc c with matches yet to come. thematches coming up over weekend but member driven noneday's blockbuster --
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bigger than saturday's blockbuster when england meets wales. that is 3:00 in hong kong, 5:00 a.m. in sydney. wallabies austria's are in action. scotland takes on the american eagles and ireland looks to make it two in a row when they face romania. ♪ angie: singapore will close the primary and secondary schools today. as air quality in the country has a hazardous level. the country has been covered in small before weeks because of weekssian -- smog for because of indonesian forest fires. this is the worst it has been in singapore this year. behind methe haze
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says it all, it is the worst this year so far, the pollution index exceeding 330 this morning, getting hazardous tting hazardous levels. visibility is reduced, we are in a thick layer of smog. you can even taste it. the government is taking precautions, schools are shut today and a nationwide music test has been postponed until tuesday and businesses like fast food chains have suspended delivery services as well. some companies have installed air your fires and issued masks -- air purifiers and issued masks. in the pastts months in singapore have been canceled. flights across southeast asia have been divergent. there has been a lot of --
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divergent. there has been a lot of frustration because this has been a yearly occurrence for decades. angie: thank you so much. reathe cleaner. thank you for that. means up next, new term new arrows for japan's prime minister. we go live to tokyo when "first up" comes back. ♪
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♪ angie: it isangie: 7:30 and that is not the singapore we usually see. intead today it is cloaked thick haze. a psi of three to four. the government got concerned. -- 324. are 30 minutes away from the opening of sydney and tokyo and korea. you are watching "first up." ♪
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the top stories this hour, the dollar rose after janet yellen confirms the fed is going to raise rates this year. it's inclined to get -- it climbed against the euro and the yen. they are expecting a tightening. did knowledge that economic surprises could lead to a change in the plan. a five-year low after they announce job cuts at caterpillar. they say they will get rid of as many as 10,000 jobs in three years, 9% of the workforce. caterpillar is suffering as crude oil prices slumped. this will be the biggest round of cuts since 2014. the japanese prime minister is shifting focus to social spending. vowed to hold the
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decrease of the japanese population after he lost backing because of his unpopular defense though. bill.fense out three arrows. let's talk about august inflation figures for japan, just crossing the bloomberg terminal. david inglis with the breaking details. david: we are just getting core cpi and metrics in line with metrics. the take away is that the inflation rate has fallen below zero for the first time since may of 2013, -.1% national cpi stripping out fresh food. if you take out energy you are seeing a growth in price levels, .8%.
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that line, -.1%, in line. point 1% line, negative, in line with the bank boosting qe. me run through other things, the tokyo cpi, fresh food, -.2%. prices are falling more than if you take a look at japan overall. quickly, the dollar/yen unchanged, futures telling us that we will see a sharp selloff in 30 minutes. 225x should be down, nikkei pointing to a drop at the open following the 500 point drop we saw on thursday. that is it for me. angie, thank you. marketset's check in on in asia, to new zealand where we are seeing a quarter percent gain.
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it surpriseday, farmers, saying that the lkrecast for payouts for mi increased more than expected. falling relative to the dollar, 63 u.s. cents. she says this year. to thecounting down opens in australia and japan and korea, let's go to japan. inflation coming in from japan at -0.1% t. nikkei 225 was down yesterday ther playing catch-up to selloff we saw in asia where it was on holiday for three days. futures pointing to -- let's call it flat. the dollar/yen. e is trying to win back support after pushing a defense bill.
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after his reappointment to another term he laid out three arrows of his abenomics plan. isabel, new arrows. tell us about the focus. el: the prime minister had an opportunity to lay out three arrows, the first is economic growth. and the second target is to create a society that is more family-friendly and easier to bring up children. the third is to strengthen social security so there we are looking at issues like helping people who are working combined that with caring for elderly relatives. it is a growing problem in japan with the aging population. overall what he is looking at is trying to maintain a population currentlylion people, 127 million but falling rapidly. he is saying he wants to put the brakes on the and stop japan from fading away. ok, i mean, he is close
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in this moment to focus on stopping the slide in the japanese population. as an issue this for decades. a lot of people recognizing that. but why now? why this time? isabel: it is a reflection of what has been going on over the summer. he has been doing things that are really unpopular with the public. there have been massive demonstrations over his defense is a supportit rate is going down. he needs something to bolster support for his government. and things like social security are a big worry for the japanese people so that is a good way of bringing back the support. also, i think going into the lookingerm, he might be towards his legacy now. i think perhaps he would like to be remembered as a prime minister that stop this fall in the population. -- stopped this fall in the
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population. angie: what is likely to be the reaction from investors and the public? bel: if we look at economists at the moment they are saying there are not enough details. this targetto have for economic growth but you do not say how he will do it and by when so it is not realistic. there might be very low reaction. as far as the public, it is the same thing. they will be glad to hear that social security is being bolstered, but they need to hear concrete details about how their lives will be made easier before they will go back to supporting abe. it is important to bear in mind that abe is set for three years, he has few rivals in his party and the opposition is in disarray. he isn't safe in his position at this point. -- is safe in his position at this point. angie: thank you for that. the fed is onays
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track to raise rates this year but says that the plan could change if there are economic surprises. the dollar strengthened after janet yellen made the comments and we have joe weisenthal with more from new york. joe: today we are from that child janet yellen who fed share janet yellen who reiterated that a rate hike is likely in the cards for 2015 but it was not a guaranteed saying. not a hawkish statement. move much. did not she continued to say that there was no reason to wait until inflation hit 2% but obviously she is paying attention to all of the things that are concerning everyone, global markets, financial volatility, the situation in china, and obviously the domestic economy. angie: joe weisenthal. time now for a look at the stories on the corporate terminal. here is shery ahn. sherry: the fallout from
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brazil's biggest scandal is widening. the offshore contractor is being linked to the petrograd corruption inquiry for the first time. a former executive has testified that someone pretending to be a transocean employee bribed him to win contracts. downs facing calls to step despite saying she knew of no wrongdoing when she was petrograd chairwoman. facebook is betting on virtual reality. sellculus unit is going to movies through the vr headset as it tries to make the device appealing to the average consumer. customers include 20th century fox and lions gate as well as streaming services like netflix and hulu. google launches a headset next year. sprinttrying to a --
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end years of subscriber loss by giving away iphones. they are releasing the new smartphone for a dollar a month. customers will need to create in the old phone. those are your top corporate headlines this hour. i am shery ahn. angie: nike is jumping higher today. the company's stock price, that is. shares leaping 8% in created as the athletic maker beats first-quarter estimates. zeb eckert is joining us. it appears that nike's athletic aesthetic is the key to the appeal. zeb: in so many markets, nike is powering ahead. let's look at the financials because this impressed wall street. a share.ising to $1.30 -
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also revenue is powering ahead as well. a saw net income coming in at 23% gain, $1.18 million, a huge global company headquartered in beaverton, oregon and run by mark parker. he was the heir apparent to phil knight. rove thehrown the -- d brand forward and reach dr. new segments of the market. tuesday conference call they just held, one of the areas of growth is tremendous growth in the women's business. brandee the air jordan powering ahead and they companies like mexico as emerging markets. china also doing well for the company. seems that china is a key market for nike although it faces homegrown competition. is china living up to expectations? zeb: it is and then some according to executives. there are big sportswear players
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in the chinese market, active sportswear for example. those are big brands. nike is a big global brand and that scored it famous chinese athletes that where products and do the marketing -- wear products and do the marketing. like he wants to grow in china, grow the number of stores. -- nike wants to grow in china, grow the number of stores. they say it is never stronger or healthier. place to do a corporate story where there is good news. -- nice to do a corporate story where there is good news. angie: swoosh. coming up, obama and xi sit down for dinner. more on what they might achieve coming up ahead. ♪
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angie: pope francis receives a standing ovation as he is a speech to a joint session of congress. francis confronted tony problems, telling lawmakers they should do more to help immigrants and reject what he called a mindset of hostility. a fairer for distribution of wealth and greater care for the environment. francis: the united states and this congress have an important role to play. now is the time for courageous action. we are in a culture of chaos and we should have an integrated approach to combating poverty.
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at the same time, protecting nature. angie: the korean president says, has warned that north has warned north korea that it will pay a price if it conducts a nuclear test or launches a long-range rocket. in an interview with bloomberg news, park says that they are a menace. pyongyang says they are prepared to use nuclear weapons against the u.s. and is ready to launch a satellite using long-range rockets barred by the u.n.. it is back on display after disappearing for a decade -- eight tosoh is back on display after disappearing for a decade is back on display after disappearing for a decade. it was shipped from belgium in a parcel listed as containing
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handicrafts worth $37. n investigation is underway. let's get back to one of the top news stories. is about xi of china to meet president obama of the united states at the white house. what should we expect from the meeting? joining me is stephen roach, senior fellow at yale university and author of the book "unbalanced -- the codependency of america and china." the relationship is a cordial one at least. what do you think they will be speaking about? issues, are multiple from some of the standard issues of currency trade and human rights to the tough new issues cyber, territorial incursions in the south china sea. tensions in the
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probablytionship are more acute than they have been at any point in a number of years. i expect that talks to be hopefully frank and direct to the points of concern that both presidents feel. not sure there is going to be any major breakthrough on any of these issues, however. angie: i am going to ask you to put your professor hat on and give to grades. xi's's performance, performance from the viewpoint of americans and from the viewpoint of chinese. l, i am notoriously a tough grader. i do not give up good grades easily. i think from the u.s. point of view, in terms of managing the
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reform and improving governance, i would say that xi gets fairly high marks. but he clearly slipped big-time this summer in dealing with the stock market. and with the currency issue. you know, i think that probably secretary, there is a lot of confusion as to what the core strategy is over china. from the chinese point of view, high marks, proud of their leader. they want him to be muscular and strong. the image of the chinese dream that he personifies and conveys on a constant basis, he is very popular in china. they would give him exceptionally high marks. in his policy speech in seattle, he did describe china's butm as the people's dream
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with the economic slowdown and the asian development bank saying it is likely 6.8%, they are probably more generous than a lot of managers out there. is it possible to achieve this china dream? is not: the china dream about an estimate of gdp and key technology acknowledged in the seattle speech that there are bumps in the road and the adjustments are not surprising given the reforms, the structural transformation that is underway in china. did attempt to put , stock market issues, the manufacturing economy, what have you, i think he tried to put those fears to rest. fearsk in the west, those
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remain a real threat. i happen to think they are overblown but i have a distinct minority view on this. angie: let's talk about just the rest of the visit. what is the most important thing we should be watching for, that you will be watching for and listening for? stephen: i think, you know, president xi said when he addressed the seattle crowd with his policy speech on tuesday, the most important thing that needs to be achieved, he listed four of them, the number one thing is that both sides need a clear understanding of the intent of each other's strategies. i think it is like to ships in the night. i do not think that china has a clear understanding of american strategy and america has a clear understanding of chinese strategy. i am hopeful that they will level so a strategic
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that we can put aside the friction and resolve and incorporated into a broader -- incorporate it into a broader framework between these two. angie: very quickly, he is coming to meet a president who is no longer going to be in office in 2016 and it is turning perhaps, a very ugly, someone call it policy statements against china from the current field of candidates. stephen: look, china knows full well that the rhetoric heats up going into presidential years. obama, he ist technically a lame duck but he is still be fully elected leader of the most powerful country in the world and his successor will
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very much in her it -- inherit the framework and strategy of the sitting president. xi cannot afford to dismiss president obama for those reasons. angie: stephen roach, thank you so much for joining us. senior fellow at yale university news andd to bloomberg ever china water. thank you for talking to us. coming up, a lot more. stay with us. ♪
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♪ the stockcome to exchange where we are looking ahead to the opens in australia and japan and south korea and our intrepid reporters are telling us what they are keeping an eye on. zeb: it is time to go shopping. angie: it is friday. is right. you have been to japan.
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this is crossing over to the jr station. if you were walking in this direction you would see the huge building. the cash you might -- t aqkashimaya is what we are talking about because we have a report on the expansion plans and they need to grow beyond the traditional department store with the aging population and the wages not going up so they are looking to southeast asia. a high-end department store. sherry, what are you doing? sherry: sharp. and cut the 2016 target look at the recommendations, no cells.4 it fell overnight. angie: that is the verdict from
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the stock exchange. stocks are based on news events. we will be back in an hour to see how they have done. in the next hour, abe facing a tough fight to revive the japanese
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>> i am al hunt. >> i am phil mattingly. tonight, washington is taking over. >> the student has become the teacher. pope francis spoke to congress.


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