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tv   Trending Business  Bloomberg  May 18, 2016 9:00pm-10:01pm EDT

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thursday, the 19th of may. i am rishaad salamat. this is "trending business". ♪ right, singapore and tokyo this hour. ,uzuki in the fast lane recovering losses from its fuel efficiency in missions. using a wind tununnel to measure consumption rather than real-world conditions.
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online ad revenue jumping 73%, users talk to hundred 60 million. mark zuckerberg defended facebook from accusations of a liberal bias. said conservatives are important to the social network. ,ollow me on twitter @rishaadtv using #trendingbusiness. the trading day under way at the bottom of the hour. look of what is happening so far. digestingan markets , underpriced or do we have to re-price expectations. ,ed funds futures went from 4%
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now over 30% of something happening in june. feels like some uncertainty. tokyo leading gains, up .5%. ae yen weakening to three-week low against the dollar, the dollar surging to a seven-week high, a bit of relief when it comes to exporters. south korean shares down 3/10 of straightmonth of declines at the factory gate, the slowest paced and one and a half years. added as welljobs as unemployment inching up 5.8 or zend, new zealand down 4/10 of one person and, a bit of
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selloffs in emerging markets, equities, currencies, along side that revelation that they could go in june at the fed. of recovery and gold, a bit downside, a reversal of fortunes when it comes to oil. i look at the aussie dollar, commodities prices and currencies, a bit of downside. saying theypleton expect the aussie dollar to fall below 70 on account of weaker demand from china and events stateside. let's look at suzuki shares, clawing back, up 5% at the moment. there we go. they apologized for using improper fuel in economy tests, using a wind tunnel because it
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was concerned about real wind at its testing track. we have a look at how serious this is for suzuki. i guess we have this rally because people are buying into the idea that it is not as bad as all that. this was ahink lesson in how to make a does closure, when you compare suzuki and mitsubishi motors, it is obviously here. suzuki had less bad news to share than mitsubishi motors did, but they came out and gave a thorough explanation of what happened. they went through testing of all of their models and tested their vehicles correctly. they confessed to the idea that they had not been testing those cars correctly in the past. testedblem here was they the cars and a wind tunnel, and the issue was that they're
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proving grounds are located on a hill near a coast, so they have concerns about wind in the field and those conditions affecting their mileage ratings. say that now they have conducted testing properly, that there won't be any change in fuel ratings, so you saw the transport ministry in japan say that as long as that is the case, there won't eat any serious issue here, and they will have to report some more to the ministry later this month, but it's looking like this is nowhere near the scandal that mitsubishi motors is facing. rishaad: why not just test these cars when it is not so windy? i'll let that one go. what is mitsubishi saying about management and its particular scandals? have the president of the company coming out yesterday
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and saying that he will resign next month. it is interesting here. i did make the comparison earlier about how suzuki and mitsubishi motors have handled disclosing this bad news. what you have had with mitsubishi is press conference after press conference, and finally the transport ministry in japan seems to be at least for now pleased with the extent of disclosure, but it took them three or four tries before the company put all of the news out there and was exhaustive with explaining all of the wrongdoing within the company and how they were testing for fuel economy. night, the company came out and did say that management played a role here, where they put a lot of pressure on the company, didn't have proper oversight of their development groups, so you do have a serious problem with the management and their role in
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this crisis. you very much indeed. there and tokyo. looking at these two scandals for mitsubishi and suzuki. we will have more on that. tweet us your thoughts @rishaadtv, #trendingbusiness include. a record in the first quarter, jeff and by mobile games and entertainment 33%, $1.4umping billion, sale significantly up. i can't believe that we chat says it has 700 50 million active users. this blew my mind. those figures are the driving force of the company right now. if you look at the highlights, it was advertising and mobile games, jumping quarter on quarter to 8.2 billion yuan,
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added more inventory. users are paying more on these mobile apps. and with the traffic by them they are pulling in, they like that and they are putting more money into the sector, so as to cater to the targeted users that tencent is providing for these companies. amazing numbers of subscribers, add growth highlight overall, and mobile growth strategy, right? that's right. if you look at the numbers, jumping 70% year on year, more isn 80% of that revenue coming from the mobile and the, also the fact that tencent had exclusive rights to the nba games, the companies saying that the slowdown in the china overall economy could put a drag on brand advertising, company will experiment with social add on its tencent we chat moments function and also performance-based ads.
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rishaad: what do they have for future growth? some interesting areas. they are experimenting with personalized news over says -- new services. they also created a new instant messaging services for answer --s called the also a come back at alibaba, creating its own service. also, the company is in the process of raising $4 billion to front their expansion and acquisitions, more than 40 deals now, $20 billion in the past four months. thank you indeed. let's have a look it's what is going on in facebook. we have >> those stories for you today. >>mark zuckerberg said it is first so very bloody and there
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is a trump gap. he defended facebook against accusations of a liberal bias. they explain how the social network comes up with trending topics. last week there was an alleged lean towards liberal viewpoints. posting after the meeting, the company's ceo said he wanted to hear conservative concerns personally and have an open conversation about how the company can build trust. tesla is raising cash to help it expand, and it's planning to do that by selling $1.4 billion in stock. ae proceeds will go towards rolling out its model three electric car and increasing production to 500,000 vehicles per year in 2018. tesla said there is more interest in the sedan, expected to go on sale next year. customers have lined up to order the car after it was unveiled at
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the end of march. it has an excel of rated in production, but that means an increase in capital expenditure. sell $600 million of his own shares to cover tax obligations on stock options. theaba is talking to football governing body and the deal could involve subsidiaries. difficulty with sponsors because of recent scandals. full details have not been released, but the deal is worth $90 million. he says he intends to make villa
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most popular english team in china. rishaad: quite a hill to climb. thank you for that one. we speak to the chief finance officer of xiao manning, the company's big plans for artificial intelligence. australia'siew of job numbers and the chance of a rate cut ♪ from the reserve bank. ♪
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inhaad: a possible rate hike june, signaling possibly this could happen. great to see you. what is going on? well, everything and anything
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come of changing times. rishaad: we have seen the equities and what they're doing, volatility back. how much of this is down to fundamentals, and how much of it get out of this asset class in get into another. as far as equities are concerned, it has been pretty much the same, a low growth environment as far as profit outlook, low interest rates creating an incentive to get into equities and risk assets. we have considerable risk, and all that adds up to in the big action are relatively flat equity markets, but a lot of
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volatility and large trading ranges. well attended to this, and one of the standard strategies is to do what you to gettingis to look those returns higher by trading the range and switching asset get highhen equities and buy back into them when they get low. thatad: we have more hands we could see a move in june. how much of this is a red herring in your review -- few? view? early in therly increase of interest rates globe.the the fed is starting this process all very gradually, and over time it will impact evaluations.
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if i'm right in this scenario, it will put trade the situation ande the growth outlook profits will be reasonably good. in these early stages, as far as investors are concerned, it probably does not make a great deal of difference whether the fed rate is a quarter of a percent or three quarters of a percent. it's more about the overall direction in terms of that trend. back to we keep coming the steam of good news being bad and bad news being good. how much concern is there amongst the people you talk to amongst your investors? about interest rates, i think it is front of everybody's mind. the austrian situation and look at the flipside of all this, we have had a seachange here with the latest cut by the rba. ratew our 10 year bond
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down to record lows, under 2%. recentmoved up again in days, but if we see further rate ofs, then we have new levels valuations for our equity markets, and indeed we have seen that play out over the last couple of weeks while the overall level of the index has returned to previous highs. these are important , both in the case of lower rates and higher rates. rishaad: talking about australia, we see the jobs data come out, and i'm going to say your guess is as good as mine given the volatility and the way it's been calculated. there's been a lot of outsizersy, some
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numbers, particularly associated with the rebasing of the sample that the pure of statistics uses. i think of sensible way of losing with statistics is to look at the trend view. at a 12 month view of our labor market, unemployment has declined from , but broadly speaking, unemployment has been falling, job growth has been good enough to do that, pretty steady participation rate, but as in other places around the world, there has not been a good enough scenario to promote wage growth. we still have very high underemployment here. the new jobs being created are in low growth, lower wage areas toe to raise him as opposed
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the higher mining services industries. there is no relief in any of this at this stage. let's take you to some stories making headlines around the world. the head of china's national people's congress told hong kong to embrace integration with the mainland and rejected the radical independence movement. he told political leaders that rocking the boat won't help hong kong, but will hurt people's livelihoods and harm the economy. the three day visit ins today, thousands of least deployed after democracy protest. hundreds of people still missing after mudslides buried villages in sri lanka. the hillside collapsed after torrential rain, 17 bodies found, but more than 200 families unaccounted for. the exact population of the villages is unknown, but each typically has around 1000 people. the president visited the scene and said the government would take full control.
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hackerselligence saying are snooping on the presidential race. that's when officials say and 2012 that mitt romney and president obama were targeted by cyberattacks. anonymous has declared war on donald trump, urging people to take on his website and post private information. powered by over 2400 journalists and 150 bureaus around the world, this is bloomberg news. let's take you we have coming up the seesawreak, effect of strength, what goes down when the dollar goes up. stick around. ♪
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this is "trending
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business". . am rishaad salamat we have seen the dollar strengths for losses and commodities. all of this after the fed minutes were released showing most officials said a june interest rate increase would be warranted if economic data indicated stronger second-quarter growth and inflation. this chart highlights the dollars move. shows when the fed raised rates. we saw that strengthen the dollar, and a plunge in commodities. greenback gauge in april saying to a one-year low, and that was due to the fact that we weren't expecting a possibility
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of a june rate hike. we now know that has changed quite significantly. if you look at the likelihood on the bloomberg, the world interest rate probability is now 32% chance that we are likely to see a fed increase next month. that is up from 4% on monday. the chance of a move to september is now back above 60%. and all of, 64%, these were below 50% on tuesday. so the increased likelihood of the june rate hike has seen the bloomberge, the dollar spot index had a huge gain against all major peers come up like 8/10 of 1%. that was its highs close since march 28, but when you see that strength, you will see weakness elsewhere. we saw emerging-market and euies with the yen
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losing some ground. bloomberggthen the dollar spot index is seeing weakness come through, so here you can see the disparity as we see the dollar rise and the commodities look like they will go down and mere what we saw in december. we are also seeing a decline in treasuries, so this is the 10 see that, and you can big fall that came through during that session on wednesday in the u.s., down by 1.25%. we have seen that mirrored in the japanese and australian treasuries as well. we've also seen some movement come through in the gold price. ond slumped as well, holding to those losses at the moment, down 1.1%, but you can see during wednesday's trade that there was that big slump in the gold price, so essentially the
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fed minutes have spooked investors, given strength to the dollar, and sparked the climb and commodities. -- a decline in commodities. rishaad: the latest employment deity from austria, moments away from that. ♪
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suzuki recovering losses, the carmaker confessed to using a win to measure
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consumption. the chairman apologize, but insisted the test data is still valid. mark zuckerberg wants to build trust and ensure the integrity products after meeting political conservatives over claims of a liberal bias in news feeds. week said facebook had downplayed conservative sources on the trending news feature. let's get straight to sydney. what do we have so far. it is better than expected, 5.7% is the read for australian unemployment in april.
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that are than expected. there had been an expectation for 5.8%. the change, 10,800 jobs created, worse than expected, 12,000 were forecast. once again, that we see the split between part-time and , 9300 full-time jobs lost, 20 thousand 200 part-time jobs gained, so again there will be some questions over the quality of this improvement in the unemployment figures. ate a look at the employment dissipation rate, 64.8%, so that has declined as well. work orople are in looking for work. check out the aussie dollar, not a huge amount of change. also a little bit on the release of this data. it is slightly better than expected. something else for the reserve bank to consider when it meets in june. we will be checking out what economists think where the cash rate is going to go next going forward to just to recap, that unemployment rate, a little better than expected, 5.7%, but ofstions over the quality
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those jobs created. rishaad: thanks a lot for that. we have a bit more of a gander at the aussie dollar. haidi: the aussie reacted and reacted again after that it are than expected print when it comes to unemployment. we had a little spike after sitting lower all morning. you can see it has given it right back, down a quarter of a atcent, still trading point72 22. that note from franklin templeton due to expectations of an rba move cutting interest rates and downside in march, pressures from china, seeing the aussie following under 70. let's get a look at how the equity markets are reacting, because sydney has been sitting lower on morning, in fact
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extending losses, down six cents of 1% on the back of that better-than-expected jobs report out of australia. asian investors .ulling these fed minutes there seeing upside on nikkei 225, the yen the weakest in three weeks against the dollar, the dollar surging to a seven-week high. also, keep in mind japan, a lot of investors and analysts saying the yen has been overbought, shares oversold, so you're looking at a track evaluation's that could be picked up right now. we are seeing some buying coming through. elsewhere, a down day. deflationaryown
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pressures at the factory gate continuing to play out for south korea. in shanghai, stocks falling to the lowest in two months. yesterday, flat, hong kong down .t 0 of 1% a bittheast asia, quite of weakness, selloff in emerging markets currencies and related assets in the wake of that surgeon the u.s. dollar. let's take a look at microsoft, agreed to sell its phone business. it's teaming up with a new finish company to buy the nokia brand. 360 million dollars. ought -- bought nokia
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oh and then rode off most of that purchase. one hundred 17 million linkedin passwords expose. the affected accounts are still active three years on. a hacker has agreed to sell the passwords for $2000 apiece. alibaba central expansion plans may have faced a set back. . users have been told to clear the balancers in order to avoid having the balance is frozen. the brand that americans love to hate is going away.
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time warner cable had the worst customer service in any industry. survivecompany won't the acquisition by charter communications. charter said it will phase out the time-warner name. the combined companies will become america's daegis cable operator after comcast. suzuki clawing back those losses that suffered on wednesday. it admitted problems with the way it test fuel efficiency. let's have a look at this. david, you say the whole consumption issue may be a problem for carmakers in the future and a stain on their history. elaborate a bit. issues is of the main that the industry is going
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through one of the biggest transformation since the invention of the internal combustion engine. the u.k. wants driverless cars in the road in five years. this will be fantastically expensive getting to that stage. at the moment, they are dealing with some of these legacy problems rather than dealing with the future. surely it can only help? the point is that it is an expensive business developing a new technology. car arele driverless estimated at $160,000, an on economic product. making something cheap is very expensive. carmakers are massive investors in research and development. the biggest investor was volkswagen, $15 billion, more than google, until, and pfizer.
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they also set aside $18 billion diesel testings program. it is sucking up management time as well as suzuki and mitsubishi comet up in this as well also being investigated at daimler, gm, peugeot. that is diverting the industry away from developing the future. we have all the scandals, what about the car that and the airbag scandal. david: in many ways, it is the proof of concept. the fuel efficiency thing is quite recent. if you look at the 12 auto manufactures, models affected by , research manufacture and develop and spending fell last year by those companies for
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the first time since 2009. is a problem. i think we will see more of the same going forward as these field e emissions issues met across the industry. carmakerseing legacy in a race with the likes of google and baidu and alibaba, apple, tesla, all trying to do develop riderless card technology. the legacy carmakers have a head start at the moment. come there are cars like bmw with that driverless feature. on legacying big problems rather than the future right now. seeking investment
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opportunities, we hear from a major hong kong developer next right here on "trending business". ♪
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rishaad: these are the stories making headlines. pentagon saying chinese aircraft carried out an unsafe interception of u.s. reconnaissance planes over the south china sea. american aircraft were on a routine patrol tuesday. the american plane was forced to descend to avoid a collision. wildfires around fort mcmurray remain out of control, although rain is forecast. the fires have almost doubled in
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size over the past week. beeny companies have forced to abandon efforts to restart the plants days after had passed.risk output has been cut by 1.2 million barrels a day. the first of the missing schoolgirls to be freed. she's said she is too traumatized to speak to did mass subduction triggered international outrage. nigeria's government has been unable to rescue any of the victims. powered by over 2400 journalists and 150 bureaus around the world, this is bloomberg news. china's number three official says hong kong should seek integration with the mainland and not independence. at a dinnerremarks attended by the city's leaders at gave the keynote address
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the inaugural event. asked and industrial property developer what caught his attention in the speech. has been covering the whole spectrum. it is everything. from what china can do, what other countries can do, and what other people can do. there was a lot of ideology and grand scheme picture, but the big question is who is going to pay for it and how will it be paid for. it is a big question. i'm sure the funding will come from various sources. will be plenty of
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private funding and investors interested in the projects, if not all. if there is a political will, is there a commercial viability directly associated with that, meaning does this type of investment from a company like yours that you are primarily a developer -- does it make commercial sense? commercial sense comes in two ways, one is immediate and one is long-term. for example, some railway projects will take a long time to repay the investors, but other intangible , sofits associated with it is difficult to look at one project and say it is a viable or not. you have to look at the whole look economy and what it can
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bring to the country and other countries. how actively you be in bidding and looking for opportunities? are not just a developer. >> we have been a contractor for many years. 93% of your revenue is still from construction. >> we are now moving into developing around hong kong, china, and outside hong kong. we also look at investment and .ther parts, like railways we have been visiting various countries in the last few months since the belt and road initiative. i've been in very us parts of maggiore at, morocco to look for opportunities
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and the amazon, and also southeast asia, looking into malaysia, singapore. we have gone down to australia, melbourne, so there are plenty of opportunities there. it's just that no one can do it all. you have to hone in on which one is good for you and your partners. you need a lot of orders in any of these projects. china cannot pay for it alone, especially in a slowing economy, and one where that has been incurred at a high pace. what is your assessment of china's economy right now as it manages this slow down and has to deal with the debt load? china is certainly slowing
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down. however, it is still maintaining i am stillre, so confident that china will have no problem. are you a bull or a bear on hong kong's property market? if you look at the cycle over the last few decades, it has this up and down, but it is always going up. eventually. of au think a little bit correction is healthy? >> it should be. breaking news from moody's, 2016 growth in the u.s. will be less than they thought here it they have lowered the -- 22.0% from2.3
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2.3%. we also have a look at what is going on in china as well. the economy will slow to 6.3% this year and generally talking about weak growth in emerging markets being a drag when it comes to the global economy, but did point out the resilience of the u.s. consumer. they also see the fed and action as well this year, saying they don't anticipate the federal reserve will be raising interest rates any more than two times maximum. this is moody's consumer confidence pickup, also talking about that as a positive in the u.s. and underlined u.s. resilience. they have reduced their growth projection to 2.0%. looking to become a bigger part of your home, how social media
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is reacting to companies artificial intelligence plans when trending business continues. ♪
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rishaad: you are back with "trending business", some of the stories making headlines. india's banks are taking a hit amid a surge in bad loans. have bad debt ratios jumped to double digits. the reserve bank of india has been warning banks about the bad debt. u.s. prosecutors are said to be examining an alleged transfer of hundreds of ousands of dollars former employer to
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goldman sachs. they're looking at goldman's role. eyeing a push into the u.s., the brewer is willing to spend $4 billion on deals and acquisitions. an expansion into the u.s. would help the brewer boost distribution to offset weak sales at home. google's latest weapons and its fight to stay at the forefront of mobile computing, unveiled in silicon valley at the company's developers conference. tell me about these names.
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>> allo one of the most important things unveiled. app duemobile messaging to come out this summer. it features a digital assistant. it responds to questions and messages. what this artificial intelligence field messaging app can take conversations and responded them, anticipating what the user might want or need . the software therefore is something that will be far more viable because they can anticipate what you need and help google with the rise of messaging apps and rivals like facebook. facebook is already building
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artificial intelligence powered applications into its messenger app as well. it does need to find ways to stay ahead as a company as a whole. people are finding new ways and looking for new ways. rishaad: what about the google assistant and what was unveiled? in the way that apple i, google could not have one until now. what a lot of people are talking about is the fact that it does not have a special name. said aboutt the ceo it yesterday. we want users to have an ongoing two-way dialogue with google. we want to help you get things done in your real world.
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youant to do it for understanding your contacts, giving you control of it. we think of this is building each user there own individual google. far, not really unusual, but what people are talking about is essentially the fact that it does not have a special name. googleculation is that wanted to use the word google, therefore keeping the name out there, so google assistant will probably be the name people will use for this. the word google will never be far from your lips. anyway. thank you very much. it's easy to stay in touch with us here on "trending business". there we go. @rishaadtv follow me on twitter@rishaadtv.
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finance ministers meeting taking place in japan despite the subject thing officially off the table, we put the question to the canadian finance minister . we will hear what he is pushing for at that meeting. ♪
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>> from our studios in new york city, this is "charlie rose." charlie: josh sapan is here, the president and ceo of amc networks. the network has made cable-television a destination for high quality, scripted shows. amc made a name for themselves with the critically acclaimed series, "mad men," and the other one, "breaking bad." their brands also include ifc and sundance. their expanding boundaries of the cable television industry. he was an early champion of video on demand. for his newest venture, the


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