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tv   Trending Business  Bloomberg  August 11, 2016 9:00pm-10:01pm EDT

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♪ it is friday, august the 12th. i am rishaad salamat. this is "trending business". ♪ rishaad: our ports of call sydni, wellington, tokyo. picking up the baton from wall street. all three benchmarks hit new records. sharp's shares surging. the house that jack built here it alibaba closing at its
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highest in 15 months. its core e-commerce business is staying strong. follow me on twitter and let me know what you think at @rishaadtv, include #trendingbusiness as well. china hong kong markets underway in 30 minutes. we have singapore, taipei, and kuala lumpur starting off their session. three main indices in the u.s. hitting record highs. haidi: that's right. that trifecta on wall street lending cheer when it comes to this happy friday session in asia. these markets have just come online, joining that rally. singapore up by 3/10 of 1%. malaysia up by 2/10 of 1%. a little bit of sentiment risk aversion. declining.25% after
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yesterday. strongest gains from tokyo, the up by 9/10kkei 225 of 1%. kiwi stocks hitting a fresh high earlier this morning, up 4/10 of 1%. australian energy sector driving gains, the asi ask up. x up.e as the bank of korea refrained from cutting interest rates. movers in the energy space. take a look at the sydney leaders. these oil and gas producers doing well today. noble group bucking the broader green market.
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this is a beaten-down stock. it suffered a second quarter net loss of $55 million, an increase in debt. some traders saying the priority is getting cash flow back on track as opposed to profit. this company is down 50% year to date, losing two thirds of its value since a damaging report came out earlier on. let's look at some other movers , sharp jumped as much as 17%, the biggest gain since may 23. saying the ministry has approved that cash injection, paving the way for the takeover to proceed. toshiba saying the nikkei report , citing first-quarter operating profit at ¥20 billion, but the
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amount is more or less accurate. this been talking about company restarting its nuclear reactor. power output is a step forward when it comes to shinzo abe's post-fukushima nuclear policy. that trifecta again, retail sales, factory output, as well as fixed asset investment. we could get a move to the downside. we are watching the aussie dollar, down 3/10 of 1%. sayingestern from ig that when it comes to the always ease, not quite as sensitive to china data. rishaad: thank you very much.
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there has not been much excitement over alibaba since its ipo. david is having a look at what is going on behind the numbers. it seems the diversification decision is paying off. it certainly is. if you want to use a european analogy, both core and periphery, alibaba did well. you lookst said when at other businesses doing as well, almost icing on the cake. shares overnight, results before $91.77 is yourn, level. just to see where we are. there we go. that is a 15 month high. let's get to earnings. for the first time since it went public, alibaba broke down the
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company's revenues, 85% coming from he conference -- e-commerce. year, that was , now8% of the total pie 15% of a bigger pie, entertainment revenue almost quadrupled. we are still looking at losses, but that was down to reinvestment and not so much operational. and inu look at cloud, fact we have a graphic, this is something that alibaba is looking at as far as expanding. this is revenue growth for the cloud business of alibaba, 156% was the latest growth clip for the business. losses less than half the level of the previous year. executives are saying we are now close to approaching breakeven
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for this business. it is still a small portion of the entire pie, just 2%. in the larger scheme of things, alibaba is just getting started diversifying. have a listen. 61%e are generating operating margin in our core commerce business. that means that it gives us the luxury and the resources to invest very aggressively into new businesses like digital entertainment and internet cars and things like that. of $5 that is 60% billion. anyway, big pop in shares. at $34 billion in terms of net worth. gates,st short of bill now closing in on $90 billion.
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not bad. bill gates, $90 billion. moread: we will have details later. tweet us your thoughts at @rishaadtv, include #trendingbusiness as well. outliningral bankers steps to give the market a greater role when it comes to the exchange rate. at the same time, it aims to keep the yuan stable. what have we heard from the pboc? are we getting a sense of clarity as to what that position is? a modicum of clarity. the pboc plan to increase cross-border use of the yuan and encouraged a mystic banks to lend yuan. they want to make it easier for overseas financial institutions to issue yuan bonds.
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every economist and analyst we spoke to said the currency is not close to being fully convertible. it could take up to a decade for the renminbi to be fully liberalized. many argue the pboc needs to , capitaltervention controls, and loosening the daily fix to the u.s. dollar. it would only then become a truly convertible currency. we will get a gauge on china's economy and just under an hour with factory data, retail sales, and fixed asset investment numbers. industrial production growing steady. the last reading. retail sales expected to remain 10.5%.ed, on fixed asset investment could come off marginally.
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we have seen a reduction in private fixed asset investment and the state having to step in and make up for that. that data is at 10:00 a.m. beijing time. let's have a look at some others stocks we should be watching, stories. it is thanks to china. first-half profit rose 51% to over $1 billion. mainland sales doubling. china accounted for 60% of all sales. sales in hong kong down 16%. the city's residential market remains "challenging."
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it is not all smooth sailing. the tycoon is facing a number of headwinds, deals and mergers warning that and fallout from the brexit vote could last for years. -- and china's 10% leading around. -- stricter of films distributor of films once funds to bill -- build its media holdings. pccw and tencent have declined to comment, but the tie up would
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give access to audiences in hong kong, southeast asia, and india. taipei, honng in hai numbers missing estimates. the global slowdown in smartphone demand hurting its bottom line. is hai's main customer apple, expecting a third straight quarter of declining sales. it has agreed to acquire that controlling stake in sharp. china'sn light given by ministry of finance on thursday. we are seeing hon hai planning to make electric cars with
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tencent. on a website, ubs saying china has already started bailing out its banks. more on that story at bloomberg.com/asia. right. a closer look at the relationship between china and australia and the conflicting interests of politicians and the business community. ubs wealth management on the tough decisions facing japan's policy makers. this is bloomberg. ♪
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rishaad: asia-pacific stocks recovering from february lows. what is in store for the rest of the year? currencies,with
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talk about the yen. of 100-107.ange it is hardly a brave call. what would it take for that range to be broken? >> it will be tough. the japanese need to do more than what they are doing. the ¥28 trillion stimulus package is not enough. when you look into the details, spending only amounts to ¥7 trillion this year. enough.not weak.ption remains exports are week as well. not much going on in japan as well. rishaad: in your portfolio, do you buy japan? on is theing nationalization of the bond market and part of the stock market. >> absolutely.
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have japan on neutral and our portfolios and don't see any potential catalyst to spark a run in the market. the government needs to do more. they need to come in with labor reforms. the cost of labor is a big issue. a lot of workers are hired on a short-term contract. that means the pay structure is different than a permanent, long-term employee. that is why consumption is not picking up in japan. , longt the other problems life expectancy, etc., but labor reforms is what shinzo abe needs to put through. rishaad: let's shift gears and look at china. a weaker yuan fixing today. managementrate the
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of the currency thus far? they seemingly do have stability . that 6.7 level seems to be a line in the sand. >> absolutely. the currency is now waited on a basket of currencies and not just paid to the u.s. dollar. if you see stability and the major currencies, then the chinese yuan appears quite stable as well. we are seeing relative calm in the markets right now, which is good for asset prices. it rallied because we have had strong performance in the u.s., record highs by all
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three indices. do you think they are gone too far? what is the impact on asia-pacific? >> if you are talking about u.s. are not valuations cheap, but not expensive as well. the u.s. equities market is fairly valued. still overweight in the u.s.. in asia, the big markets have done well. china is up because the biggest components in msci china are the technology stocks. they have done extremely well in the last quarter. rishaad: right. well, there is obviously value here. the valuations in this part of the world are much cheaper. some say they are not cheap, but certainly not expensive at what
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you advise your clients to do? >> we like emerging markets right now. valuations as you pointed out are cheap. without asia japan, they are trading at a significant discount. from a valuation perspective, they are relatively cheap. seen stabilization and exports, and we think exports could point up in the next couple of quarters. so right now is a good time to start investing in asia. rishaad: great talking to you. have a good one. we have to take a check of the latest business flash headlines. toshiba reporting results. it will post a first corley profit since 2014, $200 million.
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since 2014, profit $200 million. shares of 4%, people buying. yamaha aiming to make up for byling motorcycle demand boosting sales through southeast asia and doubling profit margins in the region. is feeling the effects of the slowdown in china as well as the slump and commodity prices. .amaha shares jumping 23% asian markets, high-priced , ands are becoming popular markets will reach 10% this quarter or next. rishaad: samsung's new galaxy smartphone has launched, featuring technology that let's the user unlock the device by
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looking at it. the iris scan system offers an alternative to fingerprint scans. the four digit password does remain. it will be available from august 19. prices have yet to be announced. profit,p, cash over nobles strategy to come back from the to your collapse that it has witnessed in its share price. ♪
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rishaad: you are back with "trending business". i am rishaad salamat. million, down5 three point 2%, adding to noble groups woes. the priority is now to increase liquidity before earnings. what is going on here? >> right.
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yesterday after the singapore crows that close, noble group announced losses, and a 32% drop in revenue, an increase in net debt. the share price has been sliding for the last two years. the company has lost its blue-chip status, investment-grade rating, shrinking its balance sheet by selling assets and winding down operations. something, howe do they turn this ship around? that was the big question on the call yesterday. the chief financial officer was clear about it. what they called liquidity had and, readily available cash committed bank facilities, fell
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to just $800 million by the end of june. the first purdy of the company is to increase this liquidity had room. overall, they want to preserve and build the liquidity of the company rather than target profit. put are willing to not emphasis on businesses or franchises in order to maintain liquidity as they go forward. quickly, what are the assets they are looking to flog? they sold some agricultural assets for $750 million. they have altogether raised .bout $700 million they are targeting $1.3 billion by the end of the year. chiefl, the founder and and chairman once return the
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company to -- rishaad: we are out of time. thank you for joining us. were looking at china's most high profile corporate battle next. ♪
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♪ asia-pacific markets on the up, all three new york ridge mark's closing at record highs for the first time in 17 years. the topix higher. gains in crude prices, further economic stimulus, investors looking for data out of china in half an hour. sharp shares on the up. hon hai'sproving
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capital injection. step toking another reestablish its nuclear industry. it switched on a reactor under new safety rules. they are expecting power from its facility in three days. challenges are affecting openings in other cities. kong opening positively, china not. markets aater china bit of divergence here. data coming out and about half an hour. , butxpected to hold steady fixed asset investment could disappoint. shanghai lower by 1/10 of 1%.
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stronger yesterday, significantly lower today. elsewhere, what a handover from the u.s., that trifecta of all three indices closing at record highs. a record high for new zealand this morning. elsewhere, the nikkei 22 five leading gains, up 9/10 of 1%. catch-upshares playing , underpinned by that weaker yen, continuing to weaken. , keykong up by 9/10 of 1% earnings coming through. hong kong holdings and property, we will get to those in the second. phillip raines -- philippines up by .50%, but malaysia gdp later today, up by .25%. singapore looking flat at the moment.
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a strong surge and austrian energy stocks, but pulled back some of those gains. look at earnings reports coming through. these are the market movers. hong kong holdings up. hong kong property seeing downside. sydney, gains when it comes to that energy space. falling last after week. thathis on expectations producers at the opec meeting,
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we could see efforts to support prices. the other one is noble group, still in the red, down 50% year today. it reported earnings that showed that continues to increase. the company saying it will focus on getting cash flow back on track as opposed to profit. noble group continuing to be beaten down. this is the aussie dollar ahead of data from china. , 3/10 ofretty steady 1% lower. ig saying the aussie dollar it remains a good i given low volatility. waiting to see how that reacts. we have seen a trend where fx traders are not reacting so much to china data as they used to
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with respect to the aussie dollar. rishaad: alibaba shares, the highest in 15 months. the company's growth trajectory looks solid. we have a look at the highlights. >> this was the fastest quarter for revenue growth since 2014. 59% growth. rishaad: that's incredible. the diversification strategy is starting to pay off at this point. jack ma has said that they not only want to focus on e-commerce, but digital entertainment and cloud. seeg highlights, you do their main shopping service attracts younger users. are actually below the age of 35 years old. into thethey have gone
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cloud services business and quite away. what are they plans they have and how has that been impacting the bottom line? >> it accounts for about 4% of revenue, the fastest in the company. close to approaching breakeven, but they also say market share is what they are targeting at home and abroad. spendmpany is willing to much more and invest much more for future growth. rishaad: these guys went into content, digital entertainment. 10% of revenue. what goes into that? how does that drive growth? the company consolidated a lot of businesses in that sector. the ott business, all of that is driving up costs. doubling in that sector, but it also brings in more revenue growth. for a longer-term view, that is
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one of the areas that jack ma has repeatedly stressed, entertainment and also catering forhinese audiences needs hollywood content and also homegrown content. rishaad: thank you very much. right. economy ¥29 trillion bigger than reported. gdp actually grew 2.4%. how could they get that so terribly wrong? it is unclear which number is correct. the official data says the economy contracted 1%. says theyestimate think it grew 2.4%. probably that actual number is between nose. this is the latest in a long list of things pointed out with
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japan's statistics and gdp data. last year, the finance minister said the person who makes the gdp data was incompetent. they have been trying to fix the problems, but this release again that therethe fact are problems with the data and it is hard for the government to do proper economic policy. as you say, questions about the data in japan, but what efforts are being made to improve it? report basically says we used a bunch of data that is not used in the official statistics, tax revenue data, other things.
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this was presented at a government statistics panel and governor kuroda mentioned it in the policy committee. it looks like one of the new ministers, who has been outspoken on economic policy, will be put in charge of fixing japan's statistics. andill get statisticians economist together to look at what the problems are and how they can be fixed. that the boj estimates will be part of that process to see where the problems lie and what can be done to fix that. this is not to say that the boj estimate is correct or the cap at office is incorrect. wind knows that no what is correct, so that needs to be sorted out so people have
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confidence in the data released by the government. nice one, james. we will check out some other stories. 21 people killed in an explosion at a power station in china. officials say 26 people were working at the time, and the remaining five were injured when a high pressure steam pipe ruptured. the plant has been shut down and is underway.ion brazil stepping up security after a police patrol came under fire. authorities say one officer was shot in the head when he and two colleagues injured a crime-ridden neighborhood. it is the most violent of several incidents that have hit the games. security forces double the number in london 2012 have been deployed. hillary clinton has ripped into donald trump's economic plan, saying it will only benefit the wealthiest while increasing the burden on the middle class.
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tried to undermine donald trump's claims that his business experience gives him the edge on boosting jobs and wages. she says donald trump would drag down the economy. >> when it comes to creating jobs, i would argue that it is not even close. even conservative experts say trumps agenda will pull our economy back into recession. accusations oft, xenophobia as australia locks a multibillion-dollar bid from china and hong kong. ♪
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rishaad: australia's treasurer denies in a behind the bid for ausgrid.
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scott morrison saying the bid's were rejected for national security reasons. what else is at play here? there is the inevitable claim of xenophobia. china has offered no comment. it has been stated that australia must have reasons beyond the obvious. the former foreign minister of australia says this is due to a witch's brew of xenophobia and economic for texan is him unleashed by the election. a little bit.hat after the election, the populist one nation party got four seats in the senate and now set on the cross bench, having a greater role to play in the coalition government. before the election, there was criticism about the sale of the port of darwin to a chinese country.
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that's the home to a large u.s. marine base. scott morrison said the decision to reject his bid was not country specific. theaid it is not in national interest, but it is clear of the political environment in australia has changed, and that meant lousy time and ausgrid -- timing for the sale. our next guest says the ausgrid case highlights the risk and rewards of doing business with china. he happens to be an wellington today. thank you for joining us. the sale would not go through because of national security concerns. what is it? clearly there are some national security concerns involved. in any large infrastructure project like this, the relevant
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authorities in australia will be looking at it carefully. unfortunately, none of us will know exactly what those concerns are because they won't be made public. there is a larger question at play beyond the security concerns. i think it is an underlying worry about china's future direction as a great power and what its intentions are. that trickles down into the sorts of investment decisions. saidad: i think your piece we need to talk about china. who in particular needs to talk about china and within what parameters in australia? >> the piece we published a call outs really to the business community and australia. on issues of national security or strategic deliberation, it has been a tradition that the business community remains at arms length.
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you could even suggest that the past 22 years of economic boom time in australia has been a luxury, business did not have to think too much about strategic such as relations with china. now that has changed. that therguing business community needs to have onarger voice, not just bottom line and stakeholder value, but rather on larger issues of national strategy and security for australia. rishaad: there is a lot of nervousness, isn't there? back forhe third knock a chinese company trying to do a deal and by another company in australia. what is likely to be the repercussions of this in china? say that chinao does have significant investments already in australia
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, one of the fastest growing foreign investor, fifth among foreign investors. andven includes investments other large infrastructure projects and other parts of the country. while looking forward, i think we might hear certainly some difficult words coming out of beijing. we already have. they are questioning the interior motives of the australians in this decision, and yes, going forward, there harder times ahead for austrian businesses as well in china. of course we have the spat in the south china sea with claims and counterclaims from with chinantries saying it belongs to them in its entirety. how is that digested amongst australian business, if at all, and austrian politicians? >> again, the business community has tended to ignore these sorts of difficult issues, not seeing
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it as their role. to the degree it is discussed, it is quite simplistic, making demands on the austrian government that they not mess up or not create too much trouble to which would undermine business interests in australia. the political class, the national security establishment, and australia, they are quite concerned about what is happening in the south china sea. they are getting more concerned about china's long-term intentions in the region, and of course the liberating what australian security policy should do about it. rishaad: it was said many years ago that if you look at a country's trade policy, you will see their foreign-policy. australia isng is essentially not playing by that old maxim. see thatks to australia is doing everything it
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can to wrestle with this theicult question of security versus economic relationship with china. they may be trying to have their cake and eating it too. my view is that will not be possible. the security and economic issues are increasingly in mashed, and australia needs to have a deeper conversation about what kind of relationship it once in china going forward. needs to be more open to chinese investment in australia. rishaad: do you think this also reflects a wider trend towards greater protectionism in the world? we have seen the rise of donald trump and what he has been saying about trade agreements. even hillary clinton has been critical. britain beating the european union, but what about britain's relationship with china/ ?
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is this just a trend perhaps in a global sense? >> it is the culmination of two things. the anti-globalization message which many politicians have rallied and which serving governments must pay attention to. that is one issue. on top of that, is the china issue. china is seen in many capitals around the world as a growing power where we don't really understand how it is going to use that power going forward. combination of those two and you run into the problems that we are now seeing in the state rid bid and the cki bid for ausgrid. rishaad: the trouble with anti-globalization is that there seems to be nothing else to take its place.
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there seems to be no rival ideology. when you think -- what you think of that? negativism -- nativism. that would drive economies further into recession in today's world. there is that alternative out there. sentiment with politicians like donald and others are playing on. rishaad: always a pleasure to talk to you. up next, japan restarting another react your as it continues its comeback back. we are headed to tokyo. ♪
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moving closer is to reestablishing its nuclear industry despite widespread
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opposition. bloomberg, how significant is this for japan? and as is a very big push big meaning for the shinzo abe administration. they have been trying to get these reactors online since shinzo abe came into power. this is a big win for them. it is a big win for the company. today, mored 5% than 5% actually, because of the news. that is their biggest jump since they finished fueling the reactor last month, so investors are taking note. big win for the environmental lobby to some degree. turning on a nuclear reactor actually lowers emissions, so for the whole country. when you turn on a nuclear
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reactor, that means you can turn off a gas plant or oil fire gas plant that provides more co2 into the atmosphere. rishaad: the thing is that there is a lot of public resistance to all this. is that the reason why we are not seeing more reactors coming online? reason why we are not seeing more reactors come online is by far the enormous public opposition. had thers back, you fukushima nuclear disaster, fresh in the minds of the citizens in japan. according to a lot of the newspapers in japan, polls are showing that about 60% of citizens do not approve of these restarts, and he higher when you look at the region's where the nuclear restarts are happening. because of the enormous local opposition, the local courts have been stopping some of these
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restarts. this is the fifth nuclear restarts in japan. two of the restarts that happened earlier this year had to be shut down because of a local court ruling. thel courts ruled that facilities were not safe to operate and were not up to high international standards, so they made the decision to turn them off and they still aren't operating. while a fifth reactor is online, the othere hard for 42 reactors to get fired back up. rishaad: thank you very much indeed for that. right. i look at other stories making headlines. china urging state owned coal and shutdown. only 40% of the annual target. beijing pushing companies to meet that target. they fear that goal will not be met.
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china,up, data dump from giving us an indication of the country's health. industrial production and retail sales, they are out next. ♪
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♪ >> from our studios in new york city, this is "charlie rose." charlie: we continue this evening with a look at the presidential election. republican nominee donald trump stirred controversy with his suggestions that gun rights advocates take matters into their own hands against hillary clinton. mr. trump: hillary wants to abolish, essentially abolish the second amendment. by the way, and if she gets to pick if she gets to pick her , judges, nothing you can do, folks. although the second amendment people, maybe there is, i don't know. but i was so you

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