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tv   First Up With Angie Lau  Bloomberg  September 28, 2015 7:00pm-8:01pm EDT

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♪ angie: gathering gloom sweeping through the markets where numbers have hit their lowest point in seven years. luxembourg lost half $1 billion in one day for glencore. that the vw scandal
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widens as audi could be carrying the same cheating software. up."me to "first i am angie lau. new zealand is down and new zealand dollar spot is weakening against the dollar, $.63. let's head over to japan. this is the view from japan yesterday. we haveei was up and futures in chicago showing that the route started on wall street is going to continue here in asia. here,is a strong market this is a safety haven play today. a couple of markets are closed today in this region, south korea is shut today, again, for harvest moon day.
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rightght, our top story now, a one-time commodity and mining star glencore has plunged on both sides of the atlantic with shares falling to a record low of fears regarding weaker metal prices. what happened here? what triggered this? >> i think this is a market that is looking for a victim and glencore is the biggest victim. a lot of investors are concerned with plunging market prices. line anding to get in it scrapped its dividends but on top of that, we've got the sloping chinese economy and there are the questions for the feds, so we have a big slump coming through with both the u.s. and london shares of down by 28% in the u.s. and a similar number in london. $14 billion has been lost from group in one month.
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of coarse, that has had a ripple effect in the commodities. -- was at at eight four-day low. angie: anyone holding this shared today is feeling a big world of pain. iette: we saw the billionaire who runs this losing $500 billion yesterday. they are worried about the company in the face of this of onefortune has fallen to -- fallen so he is falling on the list of richest people in the world.
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a hurt by the vw scandal. it lost $1.1 billion in its wealth fund. angie: how is it going to play into asian markets today? hong kong was closed today, but we are expecting, of course, that they will fall heavily. you can see the hong kong listed shares are down 16%, so not quite as severe as that 77% fall in the u.s. and london, but the downward pressure has been happening in the last couple of months. we also had this big slump at the commodity prices, and these hong kong futures suggest a weaker start, but shares in london and the u.s. were down 30% and they will be hit pretty hard in hong kong today. angie: thank you so much for that.
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losses in glencore and other commodity-related shares pushed u.s. stocks to their lowest in a month. let's head to new york right now where we see our su keenan standing by. the selling began in the morning and just picked up throughout the day. you can see u.s. stocks just took a real beating. downd the down down -- dow and the nasdaq was down, there was no progress either -- in either direction. the continued selloff we are seeing in biotech shares, we also had two more strategist that said they were cutting their forecast for the s&p 500, bringing to a total of eight of strategist at bloomberg who are role -- lowering their projections.
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and copper isged at its lowest in a month all on further signs of weakness from china. amazon and facebook have pacing declines for tech and internet related shares. the best some of performers out there suffering from selloffs. alcoa is also in the spotlight. they are the top aluminum maker. the business struggles to overcome booming production from china and the shares fell -- 6%, that waslmost one of the big gainers of the day. angie: hopefully. this will pick things up for the -- hopefully this will pick things up for the global economy. su: household spending declined more in september than in august, and you know, jp morgan scipio jamie dimon found that
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there was some austin -- optimistic comments. take a listen. jamie: consumers are in shea. their debt is now down to where it was in 1985. 10 million more americans are working and almost all of that in the private sector. su: and while u.s. consumer spending was indeed up, the latest data shows that income growth has slowed and that is something that a lot of investors are going to keep an i on. angie, back to you. angie: su keenan, a pleasure as always. so many more stories for you this morning. we may see more cuts this year. economists expect rates will be rajan by 3/7dia by of a percent. rajan maysay that
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awake the feds and this could make india less attractive. moreesia is investigating than 100 companies that may have contributed to forest fires covering part of southeast asia in smoke haze. only one the company issued a statement saying it was not responsible. has promptedrn off health alerts and school closures in malaysia and singapore. by sellingd a record 13 million iphones this weekend and there were boosted sales in china. this is the first time that the company sold in the most populous country in the world and this means that china accounted for nearly 2.5 million units over the weekend. emission scandal is
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whitening with germany launching a criminal investigation against former ceo martin winterkorn. there is evidence that other brands are carrying the same cheating software and sales are beginning to suffer. with the fraud here. when winter corn -- winterkorn step down, he claimed that he did not have any information on this. still, vw filed a complaint and they are looking into this. here what the german prosecutors -- hear what german prosecutors had to say. >> in the framework of this examination, it shall also be clarified which person with any within the-- volkswagen crew were responsible
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for these. >> they said that this will not hurt the reputation of german-made cars, but this affects so many cars globally. take a look at some of the brands we are looking at. many cars have the cheating software installed and are all of the world, 5 million are from the vw brand and 2 million from audi. skoda with 1.2 million and other brands are also affected. in japan, we are hearing from the nikkei with orders for the new vw cars is now more than 10% below the expected level for this month. source close to the company, saying a that close to 150 orders have been
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canceled. vw japan does not sell the diesel cars affected by the scandal. angie: this sounds like this is a reputational hit here. i mean, if you own one of these cars, what can you do? >> so far, this is an emission violation, so it is not a safety violation. officials are reminding their owners that the cars are safe to drive until they find a fix for the diesel engine in shoe -- engine issue. put forth, vw has to a plan by next week, that would be october 7, on how they plan to meet emission standards. angie: thanks for that. you can get more on that story and in fact all of the day's top stories at bloomberg.com.
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aftern bloomberg.com, spending $7 billion on a single well, why did shell stop drilling in the arctic? forit has been a rough year a ceo who has seen his fortunes fall by 1.4 oh yen dollars. that is on bloomberg.com. check it out. coming up, the road to damascus, the u.s. and russia no that they must cooperate on syria -- kno wtw that they must cooperate on syria. all of that and more when we return. ♪
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angie: checking some of the stories that are making headlines around the world tomorrow -- today. central bank says the foreign exchange market is expected to open for the noon
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session after typhoon dujuan came through. there were wind gusts above 200 miles per hour. the storm is expecting -- expected to cross the tie win -- taiwan straits. david bo we asked the question and now nasa scientists are answering. is there life on mars -- david asked the question and now nasa scientists are answering. is there life on mars? nasa scientist announced the discovery of water on mars. and india launches a space observatory. it is going to be sending an orbiter to mars. and the crisis in syria has dominated the proceedings at the u.n. general assembly with president obama cautiously opening the doors of collaboration with russian
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vladimirt p newton -- putin. the white house said that president assad must go while --sent putin says he must be president putin says he must be part of the solution. joined by bill in new york. will, what are the latest headlines coming out of new york right now? bill: president obama and just finished a two-hour meeting discussing syria and the campaign against the islamic state. the fact that the meeting went so long raised expectations that there would be a big announcement afterwards. there has not been a breakthrough. tiesdent putin says that with the u.s. remain at a low and he found the meeting to be very frank and honest but it
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issn't seem to mean there any agreement between coordinating or moving forward as far as dealing with islamic state and syria. angie: any other a compliment coming out of the u.n. general assembly, perhaps by china? been a lot ofs talk about general coordination against terrorism. some announcement about increasing the troop present and supporting more peacekeeping efforts through the u.n. that was welcomed, announcing $1 billion for a u.n. fund that would help deal with development issues. but syria has really been the dominant issue here coming into these meetings. of europeant leaders are shifting their position a little bit in terms of willing to be able to coordinate with the syrian government on antiterrorism activity. that raise a lot of expectations, but so far today, we are not seeing that play out. ferries,l right, bill
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thank you so much for that, joining us outside of new york. we will have more on the show discussing president xi jinping 's address. and finding opportunities during a global stock selloff. ♪
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angie: welcome back, you are
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watching "first up." let's take a look at the markets, shall we? a lot of down markets are exacerbating the worst quarter in seven years. is a 29 year slump in alibaba slid 3.1% to the lowest since the company debut, and the s&p 500 finished the day a little over 2.5% in the red. my next guest says the current market turmoil continues and we just may not see a u.s. rate increase this year after all. john kerry is portfolio manager pioneer investments, which manages a quarter of a million dollars, he joins us from boston.
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thank you so much for joining us today. what do investors do when they wake up in the morning and there is a massive route in pretty much broad-based selloff? what is an investor to do when it comes to selling or buying? first, i guess i would hope that investors would have some cash. it is always important to have some liquid assets to cover your near-term expenses. be in aldn't want to position where i had to sell into a downdraft like this. there are always bargains though. it depends on your time horizon. in the near term, things are a little uncertain. the world economy is soft and places and there are risks out places andft in there are risks out there. if you have a long-term point of view, you can take advantage of this downturn and get some good prices on some high-quality companies right now. angie: one notable, one sector
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that is notable that has always been a steady workhorse for so many, a lot of people have this in their portfolios, pharma stocks. we saw a lot of companies get hit hard very fast here. what is up for the recovery in the future? course, one of the political candidates, one of the presidential candidates, made some statements regarding pricing in the pharmaceutical area that concerned people out, again, the dependence of pharmaceutical companies on government funding, government health plans and so forth, i don't know that the downdraft we have seen in pharmaceutical companies wasn't necessarily an indication that people thought this secure candidate would get elected. -- this particular candidate would get elected. health care companies have
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contributed very importantly to the profitability of companies in the long-term. angie: did you pick up any bargains overnight for your session that just ended? i like some of the traditionally defensive stocks, i am expecting some turbulence in the markets. i think that the earning reports report forearnings the third quarter are going to be disappointing and there still are going to be issues with china, latin america, and other countries that will not be fully digested with the market. stocks have underperformed. consumer, some of the names, some of the more conservative names in finance, and even health care, especially with this correction. for good, looking stable companies. is international picture
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doubtful, some of our exporting companies have been cutting back on spending and hiring because of the softness of demand overseas for their goods and services. i would be focusing on domestic , companies providing things that people use every day, especially in the consumer area, i think, again, utilities and health care look interesting to me. watch for opportunities in the ,lumping industrials, materials some of these specialty chemical companies, for instance, might be interesting right now. i would be very cautious about the metals, i would be very cautious about oil and gas, those commodities that appear to be the longer-term kind of problem zone right now. i would be looking for buying opportunities right now in this kind of market turbulence. angie: yes, trying to save some babies as everybody tosses out
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the bathwater, i guess. in this depressed, global that theperspective, fed, despite with janet yellen said, despite what everyone has been saying, we are not going to see a rate rise this year? it remains to be seen in my view. the fed has been indicating that there will be a rate rise, but a few more weeks of this turbulence, this economic softness, we will see what they decide to do. they look at employment levels of a look at him inflation, and obviously the two are related, because higher the employment numbers, the lower the wage pressure is and the wage growth can be an important contributor to inflation, so they are looking at price levels, they are looking at employment, they are looking at the general strength of the economy. but out of the corner of their
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eye, they are looking at the rest of the world, and they kind of made these comments in their last meeting. the picture from the rest of the world is not to encouraging right now. angie: no, it certainly doesn't look like it, and shares in asia will continue the route that they continued on wall street. , we are going to leave it there, john carey out of boston
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angie: it is 7:30 here in hong kong. this is a live look at the observatory tower peak there where every day it hosts tourists coming into hong kong. a beautiful view, and that view is very easy to show you as we pan on down to hong kong island. we are 30 minutes into training in australia and japan. you are watching "first up." ♪ angie: the top stories this by almostcore plunged
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30% on both sides of the losttic, meaning it has more than three quarters of its value since march. it has sold shares and scripted dividends to cut costs. glencore was once worth $85 billion and was the biggest exporter in coal in the world. it is experiencing its biggest slowdown in china. confidence of u.s. consumers is helping the economy to grow, and july's reading was upward as rising wages fueled consumption. rising employment at the labor market pushed personal employment into its biggest gain. and the ew scandal is widening with former boss martin vwterkorn under -- the scandal is whitening with former boss martin winterkorn under investigation.
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the group confirmed that more million audi cars carries the same emission dodging devices. meanwhile, vw sales have fallen 10% in japan since the scandal broke. in new zealand, expending the route, the market is down and the dollar in new zealand is weakening $.63, indicating any move by the fed. we are also counting down the opening to australia and japan. let's get over to japan, yesterday there was a hit of a selloff. see a 2.1 chicago drop and it is holding at a at $119.94 against the yen. let's talk about vietnam now.
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it is asia's top-performing stock market. there are economic policies helping to lift sentiment and to justify why vietnam is one of the few bright spots in southeast asia. david is our travel guide, welcome. where should we go? david: it had a horrible august, obviously, but singapore entered a bear market. don't get me wrong, vietnam is not immune. but this means that if you look of analysts,erage where they think this index will be, the main benchmark will show that before the end of the year, they think it is going to be at 622, so roughly, 10% of where we are at the moment. four main reasons, very quickly,
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the economy is very stable so foreign investors don't lose any money in the exposure. up 12.3, andfic is the domestic economy is at better footing. recently revised its gdp forecast up to 6.3% and really, the policies of the government and what the government has have been put in place and they have been more foreigner friendly. some companies have been able to raise their foreigner owner limits so vietnam is exley -- angie: if you can get more skin in the game? -- david: yes, if you can get more skin in the game. vietnam is one of the main engines of growth here. how are some shipments compared to some of its neighbors? david: they have been affected,
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yes, but they are still growing. i think that is the short of it. thean, it is nowhere near double-digit growth that we saw back in 2013, 2014, but again, this is based on the latest release from these countries. it is head and shoulders above the rest. vietnam has actually spread its debt a little bit further. america, the u.s., is now it's biggest trading partner. think 8.2 billion exports went to the u.s.? so relatively speaking, it has guess, manage its exposure, unlike, of course, south korea and taiwan. angie: everybody else? david: yes. angie: but there are some risks, right? david: yes, we know how vietnam authorities tend to react.
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they like to magnify the foreign debt against their balance sheet, but that means it's nowhere near -- china and vietnam are a completely different ball game, so if you look at the outflows from china, i think the latest one was in -- 140 $140 billion, billion, 150 billion? that was just a few days ago. that is roughly the same size of the entire economy of vietnam. there is your story right there. angie: all right, i think your numbers tell the story. i thank you, david, for telling the rest of the story. let's talk about singapore now because the prime minister has replaced his finance minister as they face growing economic challenges. marketw face a gloomy
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with the index finding itself in the their territory. let's go live to our southeast asia correspondent. >> a gloomy morning for singapore. you talked about how the market is in bear territory, and by definition, that means a drop of about 20% from its peak. it dropped yesterday at its close and that is what drove singapore to the bear market. now, blame it on china. they are highly dependent on the chinese market and it is all so -- also the commodity trading hub. and atnomy is slowing that impact on singapore is happening in a huge way. we also want to look at how industrial production has been going. down, down, inn, fact, it is at a 10 month losing lookingnd set is not
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well at all for the singapore economy. in fact, now some economists are saying to brace for a technological recession. that should come out sometime next week or the week ahead, so full speed ahead for the lion city and it is really looking at andthe growth will hold out there is a close watch on how china's economy is doing, how china is coping with its easing gdp. angie: well that's the point, isn't it? china -- singapore's prime minister reshuffled the binet yesterday. helper or does the new team to how these obstacles -- prepared is this new team to face these obstacles? haslinda: changing demographics help this, but the reason the prime minister reshuffled
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this was to prepare for the years ahead. he has put in place younger leaders and half of those appointed to his candidate -- his cabinet are below 55 years old. you talked about a change in the finance minister, that position now goes to a position previously held by someone who most qualified for the put inng the new leaders a position. the prime minister has made it very clear that the new leaders are going to be stretched and they are going to be tested and in fact, further changes in the will happen sometimes at the midterm -- sometime at the midterm. angie: thank you so much, haslinda. time now for a look at some of the top stories on the bloomberg terminal. may be facing a
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downgrade three months after saying it would double its credit line to finance clients. moody's says a fully tapping some of these billion credit lines was substantially weaken the balance sheet. it is also under pressure to boost profitability and this is in the face of record selling art prices. sharp will sell its of soccer osakaarters -- its headquarters. sharp will lisa back the property and continue to use the headquarters until march of 2018. minions have a new order = -- owner.
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pay theersal will largest overseas investment for comcast and it dropped a 45 billion dollar deal to buy the rival time warner in april after accusations from problems from antitrust regulators. angie: some of the world's leading watchmakers prepare to display their wares at japan's convention. but timepieces are on a steep decline. >> bloomberg intelligence announces that watches sales were down in august before dropping a further 11%. accounts region that for half of global exports and $7.2 billion annually.
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mainland china had august exports plunge 37 percent, hit hard by stock market volatility. the devalued yuan hasn't helped either. after less than a year on the market, the apple watch may also be facing switch watch a volumes. it sells for 340 nine dollars, so the watch deal is in the same ket.e brac apple is keeping the sales a secret, but with 40 million watches sold by the year's end, there could be more action needed from the swiss watch industry. onie: and later this morning bloomberg, we are going to have more on these desirable timepieces. 11:30going to check in at in hong kong time, and coming up next, stepping into this light -- into the spotlight.
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we are going to have all of the of china's president visiting the united nations when we return. ♪
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angie: checking some other stories making headlines around the world right now. investigationnal is underway regarding an explosion on a boat in the maldives. aboard the boat escaped unhurt, but a bodyguard was seriously wounded. investigators want to know if the explosion was an accident or an attempt on the president's life. the zimbabwean hunter who led the expedition that killed cecil the lion will have his case thrown out of course. that theor him argue charge of failing to prevent an
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illegal hunt is unclear and not a criminal offense. he denies any wrongdoing regarding cecil's death from a american -- from an american tourist. cecil the lion was known for his distinctive lack main. switzerland opened an blatteration into sepp and he said he would not step down. they believe there is mismanagement and misappropriation of funds. this is in regards to a fee for boss regarding funds that the boss received from sepp blatter. china's president xi jinping has committed thousands of troops in billions of dollars into u.n. peacekeeping efforts and he
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addressed the general assembly for the very first time. he also told rich, powerful nations to not only the poor or the week -- not bully the poor or the weak. when you listened to this speech, what were the most notable remarks there? do you think he was successful? he was successful because we need to think about these speeches every 10 years that the chinese leaders say to these other nations. they are presenting a grand vision of what china will be in the world and how china will bring about peaceful co-operation. and you have to think about the audience here, not only is about the world but what the world will have to say, and china sees this position that they have as being a great leader. they're confident going into the 21st century. angie: a little bit of
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controversy at the united nations as well, hillary clinton calling resident xi jinping shameless when it comes to women's writes and he still has rights and he still has many women leaders incarcerated as we speak. how did that go over on the international stage, and how did that go over with china? andres: this is interesting, right? hillary clinton's comments are said in the shadow of a general , and again, ig up think we see a bigger picture here. when the chinese speak to the world, they talk about these grand visions, these grand pictures, these great themes, and the issues are always going to be there, women's writes, too bad, so forth -- women's rights,
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tibet, and so forth. but i guess the president is dealing with these issues in terms of gender and equality and the media has reported about mediand the chinese ofentially accuses the u.s. putting its nose in these politics. in terms of, foreign policy, is very famously not stepping into any international foray. they have kept out of the global fight, as it were, i guess until, it has technically committed 8000 troops and $1 billion to u.n. peacekeeping. is this a change of tactics for china? andres: i think, i think that is one of the most interesting points that china is making
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about its rising power and being assertive. alwaysusually china has been a part of the u.s. since 1971 and we learned that over the decades as it was very shy about using its power. year 2000 onwards, we have seen a growing use of the veto and china trying to make more of a physical demonstration of its powers. again, what makes china they willis that always view the u.n. as a platform to push forward its own international interests. having chinese troops stationed around the world is a way in which the chinese will project their power, but also, they are using the tailoring, the clothing of international cooperation, and i think it is harder to be criticized when you talk about china's power around
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the world. well, for president xi jinping, this has been an opportunity to meet and greet and shake a lot of hands of a lot of other it leaders -- other leaders. meeting will we see may become to fruition in the future? dres: do you mean the importance of the actual meeting in washington? angie: i wanted to know, you know, for example, he met with greek prime minister alexis tsipras, he invited alexis tsipras to china, he has met with other world leaders. to understand how these perhaps nascent relationships might show and really ill -- and reveal themselves in greece, for example, or maybe as an extended business relationship? what for the most notable for you? : i think, well, i don't
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know the exact details about the invitations from the prime minister, but i think what we saw with the u.n. is a command -- is a commitment to china and i think what the bigger picture is showing is that china is trying to be a leader for other developing nations. thannk that is different the ways the west has seen it its role in these institutions of financial control, such as the world bank or imf. this is what i think is very much leading the way into a chinese understanding of how power has to be distributed in a much more critical way, and i think as a historian, if we go back to 1971, china has always argued that it is a third world nation and that they will very much a up for other third world nations as well.
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so i think inviting a nation such as greece makes them embrace these other nations and perhaps get embraced by the west and even get embraced by chinese. angie: thank you so much, andres rodriguez from the university of sydney there, thank you so much. and we are going to see more on the stock exchange, coming up after this short break. ♪
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angie: welcome to the stock exchange, let's take a look at the opens in australia and japan. our reporters are here and keeping an ion it. maria? harvest moon holiday for another day? i just have to get my
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hello kitty back today, it has raised -- [laughter] saying that there are raises and there are 17 a buys on the stock. it wasn't so good yesterday so we are hoping that it gets better today. angie: and david, what are you doing? david: steel is strong. go hello kitty! [laughter] david: and there could be a target in the next six months. angie: and sherry is pushing drugs? [laughter] sherry: yes, they are valuing the company at an 18% value above the closing price. so that is for eps holdings. angie: ok.
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that is the verdict from the stock exchange and our stock reporters have told us what they have seen. looking at the next hour, comcast's
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al: i am al hunt. john: john heilemann. and with all due respect, life on mars isn't going to come down here. we are going to build the most readable while stacy you have ever seen. space youul wall in have ever seen. john: happy national drink beer day sports fans. my favorite day of the year. i am absolutely serious. so are barack obama and vladimir putin. totally serious, that is. here is a picture of them clinking glasses at the u.n. sure, it is not beer, but everyone knows it is impossible to get through the u.n. without a buzz. sp

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