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tv   Trending Business  Bloomberg  September 1, 2016 9:00pm-10:01pm EDT

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♪ it is friday, the second of september. this is "trending business". . am rishaad salamat ♪ right, singapore and tokyo. game as the u.s. jobs report for august, less chance of a hike this month. the g-20 ask how they can drive the global economy. explodes on the
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launchpad for spacex. follow me on twitter at @rishaadtv, and use #trendingbusiness. some disappointing manufacturing data. asian equities muted ahead of the employment number. not the best friday for markets. downside this morning, malaysia and taiwan coming online with a pop. singapore is off by .25%, malaysia slightly higher, and has moved tospi the upside. thead the revision from bank of korea for second-quarter gdp, rising to 3.3% year on year thanks to a rise in private consumption.
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construction investment of 3.1%. that lifting the overall figure slightly. 225, weakness, down by .1%, the yen holding around that 103 level. downside from some of those car players. tokyo dome up by 4%. australia the worst performer, not surprising that we see more downward pressure on oil, the flight to safety, so all in all, stocks looking strong. regis resources and evolution mining up a by 7%, so that flight into gold. we do have consumer sentiment figures from japan later. rishaad: thank you for that. lifting the global economy out of its slow growth is not the
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official title of this weekend's g-20 gathering, but it might as well be. what is the top of the agenda? the theme of this years g-20 ummit is toward an innovative, invigorated world economy. china has put interconnected development high on the agenda. starting tonter is get crowded as things kickoff. getting here was a challenge, security very tight around the g-20 summit. this is china's most high profile meeting of global 's history, nona food, no drinks, no hairspray allowed.
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journalists are being herded in areas.overnment provided state media has given played to the idea that china will show leadership in shaping global governance, proposing a joint initiative to revive week global growth. the summit on sunday and monday, we have 800 global business leaders headed here to hangzhou to discuss topics such as green financing, global -trade, and transparency. they will be announcing a policy for g-20 leaders. rishaad: what could take attention away from these talks? despite what beijing might want to talk about or show here at the g-20, the fact remains
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that there is a lot of tension over everything from territorial argument suchery as protectionism around the world. by theas been angered u.k. and australia over their precautions against chinese investment in their countries. about thering tensions and relations being frosty between china and its neighbors over a territorial dispute in the south and east china's seas, not to mention a u.s. missile defense system on south korean soil. will feature high on the agenda of bilateral summits that kickoff this weekend as leaders start arriving here in hangzhou. rishaad: coming up later this , a rare interview with the russian president vladimir putin speaking with our editor
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in chief. tune in today for that exclusive conversation. right. i look at what is going on elsewhere. we have a look at something called passporting and what it could mean for the u.k. in the future and what it may not mean for the u.k.. few details still on how and when brexit will happen. sources say the world's biggest banks are putting pressure on theresa may to come to an interim deal to preserve something called passporting, the bank's ability to sell services across the eu. big namesreement, the could move out of the u.k. as soon as the government starts negotiations. article 50 triggers a two-year countdown for the u.k. to leave the eu. leaders have said repeatedly that they will not hold talks ahead of a formal u.k. exit
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process. electronics recalling galaxy note seven smartphones around the world. it is due to faulty batteries that could catch fire. they are investigating the issue and could announce a plan this weekend. a weeksible recall comes before apple is set to introduce its new iphone on wednesday. samsung has delayed shipments of new devices, saying more testing was needed for quality. given vimpelcom the green light for an $8.8 billion merger that will create italy's biggest mobile carrier. the companies had to first agree to help a small arrival become italy's fourth biggest. they will sell towers and frequencies so the company can expand. hutchinson is controlled by hong kong's richest man, li
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ka-shing. rishaad: the u.s. auto industry may have reached the end of the road. every major carmaker missing estimates. let's bring in our cars editor. take down these numbers for us. who had the worst showing in a downbeat month? is really telling when you look across the industry. each of the carmakers missed estimates as you mentioned. you also sold them all fact in a range, so it is pretty consistent. toyota, nissan, honda, decent drops for the month, nothing too seriously be alarmed about. in the in the, we have a 17 million seasonally adjusted rate , a number below where analysts
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were expecting, but this is an industry that has been on a six-year run, has seen a lot of positive growth over the last cyclical, and for a industry, it is unusual to see this long of an uptick in sales. perhaps no surprise we are seeing a bit of a pullback, but at the same time, if you are looking for growth in the auto market across the world, it seems as though you have to take t u.s. company on board ia this point. rishaad: what is the bigger picture for the american market? >> it is telling you that if you look at at what was discussed on ford's conference call, they are open to the idea -- they use the word plateau, the idea that you have not heard the u.s. automakers talk a lot about it.
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the idea that pent-up demand month in and month out over the last six years, this idea that there are consumers in the states who held off on purchases during the recession or in the time that it has taken to recover from the recession, the putting onhey are the table that there is pent-up demand left is significant. that is something we have been waiting for in terms of whether this growth streak can continue. runidea that we have out of tent pent-up demand is significant and makes it unlikely to see much growth out of the u.s. market from here. rishaad: still ahead on "trending business", another rocket blows up on the launchpad, but how much of a setback spacex is this for spacex -- much of a setback is this for spacex and elon musk.
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rishaad: you are back with "trending business". there is a growing consensus that the current boj program is not working. has the central bank reached its limits? the asia-pacific cohead of asian hsbc.es at essentially trying to flawed a dead horse? >> the boj has been at this for a long time. they have reached the limits in terms of policy. is it right they review what they have available and what else they can do? i think it is possible, for sure. in may, go away,
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come back on labor day. hugely obsessed, in the noise, any data, markets moving, so we will see how it goes with payrolls tonight and how the markets move after that. in terms of fed movements and noises, that is where the market is focus. rishaad: if we get a strong number over 200,000, that could prompt them to do something, the point being 25 basis points will not make a big difference. they might as well put people out of their misery for the time being. >> they want to get ahead of the curve. rishaad: but they haven't. >> there is a 40% probability for september, so they are trying to get ahead of the curve. the 25 basis points is not a large number. they are very data-driven,
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internal and external. we will see how the focus goes from here. what about u.s. equities? they are at record levels bouncing around. we need something to break it out, a catalyst. with that be cleared direction on monetary policy? >> it is one factor they will take into account. the s&p is fully valued at 18 times earnings. it is one factor they will take into account. these are all data points they take into account. the of session with the fed will continue for a while longer. rishaad: until they do something, then there will be a wall of worry after that, then we begin again. are do you look at if you looking at 18 times earnings and the s&p, 12 in hong kong, valuations lower and reasonable, i guess you could argue. is the money coming in this direction at the moment? >> it is moving.
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you have had a massive outflow of emerging markets. i think we are seeing the first ships of money coming into emerging markets in credit and equity. i think that will go forward as well. the fact that valuations are cheap and earnings are stable is interesting. rishaad: are you underweight hong kong and taiwan. >> we are under way taiwan, which is done well. neutral to underweight on china, and within that space, we are over weight in the fastest growth varies in china. rishaad: new economy question ? bethis engine connect will part of the catalyst for that interest. connect will be part of the catalyst for that interest. that shanghai catalyst
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was a bit of a disappointment because people were not as interested in the old economy stocks. >> yes, you are right. dual listings are not that interesting. issues around beneficial ownership's, some of those mores make shenzhen interesting going forward. rishaad: is there a move towards msci inclusion as part of the market plan? >> it definitely helps. you are now opening the second-biggest in china. it has to have inclusion at some point in the future. rishaad: a lot of people overweight philippines. that there seeing has been money coming out. philippines had a good run, one of the favorites for investors globally. valuations are not cheap right now. we are seeing flows coming out of the philippines now. rishaad: g-20 summit, what are
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your expectations? .> the chatter is sanguine it feels like nothing large will happen. at the moment, very little. mightd: the thing is this be titled how to get the world out of this economic funk, but the point is it should be called that. what are we seeing? have we known times like this thing seems to be stagnating? >> the liquidity injections are not having the impact they expected to have. rishaad: we started with the limits of monetary policy, and that's where we will end. thank you very much indeed. a quick check of business flash headlines. --le may repeat trade repatriate $5 billion in cash next year. tim cook told irish radio that it might happen in 2017.
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on tuesday, the european commission says apple owes more than $14 billion in back taxes in ireland, most of its european revenue. of itsng a mini version device, hoping it will make it a winner. the initial phone came out earlier this year, featuring dual speakers that makes the sound quality better than that of others. bendai merchant said to planning to deploy ships to ease .argo disruptions this is after the failure of hanjin shipping. seekn force companies to other carriers. hyundai merchant is the world's seventh largest shipper with 3% of market share. week to not a great
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invest in austrian ipos. we will have a look at that and more. this is bloomberg. ♪
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rishaad: you are back with "trending business" as we have a look at more bad news for investors in australian ipos, a trucking company less than three dropping 54%isting after announcing a right down. we are in sydney. our ipos worse than other investments there? ipos worse than other investments there? >> you can have big share falls in all sorts of companies, but you want a balance of risk in return, and the risk is higher with ipos,'s you expect the return to be higher, but that
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does not look like it is the case. of ipos we tracked from 2009-2015, 27 fell more than 20%. 17 fell more than 50%. three of them have gone into administration. $30 billion of equity capital has gone into those ipos and it has turned into $35 billion. it is an improvement, but less than you got if you bought the index, so the risk return equal is not working. tell me something, is there any reason why they perform so badly? think the real problem we have in australia is there is too much cash chasing too few stocks. free has the fifth against pension pool in the world. japan has five and a half times the population, what its pension pot is less than twice the size
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of that. you have this huge amount of cash, about 10% larger than the market cap on the asl's of all ordinaries, so people are x of all-- on the as ordinaries, so people are taking unnecessary risks and pushing up the value of ipos beyond where they should be. there debate going on about perhaps improving the situation there, and before we leave things, what is going on behind you? it is quite some weather. >> it is a horrible day today. sunny weekend sydney and it is heading into a rainy day today and tomorrow. in terms of what is being done about it, one thing you could do is improve some of the tax benefits that essentially favor
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a dividend over bond coupons. there is a low rate of fixed income among australian retirement savings, but the real thing is investors could do with a bit of self-help. one ipo went dramatically bad, and the market went on strike for three years, and that is what needs to happen now. rishaad: thank you a lot for that. right. some other news. india's richest man has pushed into the telecom space. serviceking about the that debuts on monday and will stay free until december, putting pressure on existing
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carriers. shares and rivals took a hit on thursday, wiping $1.8 billion off of market value. prime minister's modi campaign isboost india's economy designed to attract foreign investors to help india compete with china is the world's factory. the chief technical officer said every company should consider india a market. >> if you think about it at a broad level, we take energy, , and digitalness consumer products and services. , those areasies that have an impact for 100 million people and the potential of $100 million in profit. rishaad: plugging into the electric revolution, looking set
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for an initial public offering in china. the market open in hong kong and china, the final trading day of the week. the opening numbers are coming your way right after this. ♪
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♪ rishaad: preparing to host g-20 leaders this weekend in hangzhou . infrastructure seen by many as a way to kickstart sluggish economies, but there is a cost. carmakers among the losers in tokyo after every major producer mr. u.s. sales estimates in august, a sign that the six year growth run is coming to an end.
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the biggest incentive since 2009, but that has not stopped the annual sales rate from falling to 17 million. samsung set to be on the verge of announcing a global recall of its note seven smartphones due to faulty batteries which could catch fire. the company could announce a , an as soon as this weekend critical time for samsung, one week before apple is set to introduce its new iphone. the tradingart of day in shanghai and hong kong. let's have a look at equities in the rest of the region, a mixed bag. is the orderance of the day ahead of the jobs data from the u.s. later tonight. we have seen a flat open in hong kong. yesterday, we had that solid rally coming through on the hang stocksarticularly casino , macau casino revenue rising
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for the first time in 27 months. today, a switch out of stocks that did well yesterday like the banks. a pretty flat day on the open in shanghai, down by a 10th of 1%. we are seeing flat movement on the nikkei and the kospi. in australia, you are seeing risk avoidance, particularly gold players higher, putting money into those safe haven assets, but energy players coming under selling pressure. new zealand flat. philippines very flat. , which underperformed yesterday, doing well today. a lot of stocks to watch today. numbersst car sales came through in the u.s., a disappointment. nissan andn honda tour yoda fallen early japanese nissan, andda,
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toyota falling in early japanese trade. glencore could be making a play for coal assets worth a billion dollars from santos. rishaad: parts makers are cashing in on china's push to boost the sales of electric cars. second-biggest biggest maker of batteries look set for an ipo. how are these battery makers position? due toe a supply issue the boom of ev sales? china's ev sales tripled last year to become the world's largest market. that is accompanied by the boom in demand in batteries as well, even though there are hundreds of battery makers in china. a lot of them are small in scale and in quality, so the demand
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has in concentrated in the top players in the industry, and theirs the reason behind plans to go public and to raise money to fill its capacity expansion. what is the industry's outlook in the long-term? what are people saying about it? is backed by boom government policies, but there is uncertainty over whether the government will remain ev friendly and keep their policies over the long-term. lot of battery makers are ramping up capacity and china right now, but there is a question on whether there will be a supply issue in the long-term. doesially if the ev demand not really live up to the expect
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haitians of the government and those battery makers as well -- the expectations of the government and those battery makers as well. this is a bit of a tall order, isn't it? >> it is. already supply three european automakers, including bmw. they are there domestic supplier in china, but they are also trying to build a plant in europe and become one of their global suppliers. they have toat, narrowed their technological gap with the japanese and korean battery makers. they seem to be confident because they have a very young and strong research and , and they sayam
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their technology is not inferior to korea and japan. rishaad: thank you very much indeed joining us from tokyo. the prospect of an ipo worth more than $2 billion will attract no shortage of banks hoping for a slice of the action, but this is not the case when it comes to anbang insurance. start offu have to with the obvious one, they should be lining up around the block, but they are not, are they? >> they are not. they are inching forward. this would be an exciting ipo for bankers next year, where pickings currently look slim as far as major offerings go, but there are major concerns and there have been concerns about just quite how forthcoming anban g is prepared to be about its governance. rishaad: also questions raised -- that $14id, that
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billion bid for the hotel chain. i forgot which one it was. starwood. they pulled this with literally very little notice. starwood thought they had a deal, then an e-mail came out of the blue saying they had withdrawn. rishaad: marriott thought it was a done deal at that time. >> they went straight to marriott soon after that. the track record is one that raises alarm bells. a bank compliance department, the first thing you need to be comfortable with is yc, which is know your customer. been secret about who holds it and who its shareholders are. we will see if we can
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get some transparency out of opacity. a quick check on some other stories, air china and lufthansa finalizing a deal. it is believed the carriers want to coordinate routes and share revenue. lufthansa chief executive will travel to china in a few weeks. the two star alliance members have been operating co share rights for more than two decades. fire eyes says it found at least three attacks in early august by techniqueich used a sending e-mails with malicious links. confirm whether it is linked to any chinese government or organization. bid for the 2020 olympic has found nothing illegal. millionrt says the $2 sent forbid planning services
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and lobbying was legitimate. it concludes that bid leaders knew nothing about the links with the son of the former athletics chief, who is accused of corruption. has suffered another spectacular setback as one of its rockets exploded on the launchpad. what went wrong? david: unlike most things in this world, this is actually rocket science. it was fairly complicated. just have a look at what happened. i will shut up for a moment and you can look at what happened. this happened shortly after 9:00 in the morning in florida. it happened during a standard , where you rev up the engines of the rocket before the actual launch. what happened is the rocket and the satellite were destroyed. we understand right now that spacex knows where this anomaly
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started. have a look at this tweet. rishaad: here we go. david: they are still looking at the data. they don't know why it started. rishaad: that looks like more than 140 characters. david: it is an image they put on the actual tweet. can we get the elon musk tweet? they know where it started, but the cause is still unknown, so standby is what he is saying. it is a reminder that spaceflight is an incredible challenge. it is a reminder of the dangers of spaceflight because you try to control explosions to propel whatever payload. it was a facebook satellite designed to bring the internet to africa.
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a satellite owned by an israeli company to be used by facebook in africa, where mark zuckerberg happens to be as well. he put this on facebook, disappointed to hear about it, but they are still continuing on with this mission. rishaad: it is beyond facebook and spacex, isn't it? the thing is that there is a deal, let me get to my notes, there is the share price, down 9%. there is a transaction right now between -- the successful launch of the satellite was a condition of the sale. is whilele are saying
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the satellite is actually insured and the bondholders are safe, it might lead to a loss inclines, like facebook. rishaad: thank you very much that. up next, is the honeymoon over for philippines stocks? next guest why he does not see a cause for concern. ♪
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rishaad: a quick check of those business flash headlines. man sows ahest stronger yen will not hold exporters back. , he seesiling opportunities abroad, especially in the u.s. and the west coast. he is betting more international sales will come from other asian nations in five years. he says they must adapt to the
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yen's move. >> japanese businesses are getting globalized. simply a higher again would not prevent japanese companies from exporting more. the way japanese businesses, including ours, need to transform the way they do business. china etflack rocks showing signs of stabilizing after a 22% hit in the first six weeks of the year. net asset values also improved. it is currently outperforming its underlying index. selling its entire interest into leading brewers in an unprecedented move for vietnam. $1.8 billion, the consideration there.
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the other is worth $400 million. it is the first time vietnam has relinquished control of a key state owned firm, and the budget deficit forced its hand. timeemon having a bad after forecast missed estimates, shares down 9%. the apparel maker saying earnings will be at the midpoint of the range. .hat miss the $.44 average they are facing more competition from nike. , quick check market wise tokyo, the nikkei 225, it is really flat at the moment. asian-pacific equities muted. is we are behind it awaiting that all imported jobs report out of the united states, looking for about 180,000 there. sydney downside, off by a third
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of 1%. we have that jobs report and how it shapes expectations for the next u.s. interest rate hike. , paringl on the way up its biggest weekly losses since january. looking at singapore, moving to , thekong, and this one straight times index, a beautiful day in singapore, 1/10 of 1% down at the moment. in hong kong, not such a beautiful day, the hang seng moving to the upside by one quarter of 1%. good month for the philippines. election,ked by the $250 million pulled out in the last few weeks, but our next guest is not concerned. what is going on? i'm not too concerned about
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the philippines. the stock market has been overvalued, even before the election. i think there is a lot of short-term mentality and thinking the new president can deliver something quick and fast within a few months. going to happen. you saw that in indonesia. it took time to get things right and get a bit more comfortable, and we are clearly seeing some measures being done in indonesia. it will take times in the philippines as well. there are deep structural issues to resolve. , would: the thing is this money have come out even if he had not been elected? >> i think it would have. the market was overvalued. there was a lot of questions
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about who is going to be president. there was an incentive to take some money off the table, and we did as well. theave not exited philippines, but have reduced their waiting we had in the philippines, just to take profit and put it into other weaker markets. long-term, we like the philippines and think the stillic landscape there has legs to run for the next 3-5 years. if you like the philippines, is it the right time or do wait for more money to come out and perhaps make the market have better value i suppose? weakness is at good opportunity to add more, and we have been selectively looking at some names, not just
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the market as a whole, but names in particular that have been addingnd we have been more there. the bigger problem in the philippines is that the depth of the market in terms of the investable companies that are liquid enough, that has not really changed over the last 10-15 years. it makes the universe somewhat a bit constrained, so we really need to see, at least for us, to see more weakness before we will put more money in the philippines. know,d: right, well, you the new president is seen as pro-business, isn't he? >> yes, he is. we spent some time with him before he became president. achieved quite a lot of, in termsne quite a bit
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of how it operates, cleanliness, and even the companies that operate there, he is pro-business and pragmatic enough to understand he needs the private sector to invest in the country, because the government does not have deep coffers to rollout infrastructure projects. the big concern is that the manner in which he goes on solving some of the issues, but so far there has not been anything draconian about the business policies that he has announced. rishaad: a quick word on indonesia, another market you cover, and you quite like, but it is quite crowd, isn't it, this trade? go on. >> it is. it is very crowded. we have always been overweight indonesia over the last four years. we have been a bit cautious obviously.
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the market has run up too fast and too quickly. we like markets moving up slowly in tandem, but we moved up to fast and too soon, so there is a worry it will correct. as ane used it opportunity to see where we can take some money off the table marketsit in weaker offic like malaysia. has philippines, in asia the right sort of economic trajectory as well as the demographic aspect as well, and we like the consumer names there . there is still this emerging middle class with an untapped consumer market. rishaad: thank you very much indeed. joining us there from singapore. up next, i'm property, heading to singapore, the details of a rare land sale. this is bloomberg. ♪
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rishaad: welcome back to "trending business" live from hong kong, streaming on bloomberg.com in your mobile device. a piece of land in singapore's business district, the first in nine years. our southeast asia correspondent , why such a scramble at a time when we are seeing a stagnant commercial property market there? because it will be a while before the next land sale is expected. for newook at plans office openings, you will see a flood of supply until 2018, but after that, none for three years, so any development completed by early 2022, if you buy that land on sale now, you -- pentinto demand
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up demand. it may fetch the most expensive price on record. it could include sovereign wealth funds, chinese developers. soldthe plot of land to be sits next to the building which was bought not too long ago from black rock, paying $2.5 billion, singapore's biggest office transaction yet. ,ishaad: as we have been saying the office space in hong kong has been in the doldrums for a while. is there any visibility about when things will improve? >> not so soon. it will get worse before it gets better. take a look at this bloomberg chart. it shows how vacancies have been rising. the downwardows
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trend, and according to some analysts, you have not seen the worst yet. you can expect vacancies to rise as more offices come onto the market. this slowed down and the global economy impacting singapore and big way. it is highly dependent on exports. the property market has been slumping, not just office space. the government has implemented a rounds of cooling measures and seven years to prevent overheating. there are some signs that they are now actually working. rishaad: thank you very much indeed. coming up later today on bloomberg television and radio, rare interview with russian president vladimir putin speaking with our editor in chief. tune in all day today for that. looking at awe are , setting off a global response. we look at the markets on a day
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of mixed activity. the hang seng in hong kong marginally higher. volumes are thin. we also have people on tender hooks for that all important jobs report later friday. ♪
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♪ announcer: from our studios in new york city, this is "charlie rose." charlie rose: tell me about "horace and pete". how did you come to this? [laughter] louis c.k.: it just-- i don't know it's weird. it is like i found this family in my head somewhere. i don't know. i got interested in doing a show that was like multicamera the way a sitcom was shot but without the audience, without the laugh track and without the need for the constant jokes, that pumping of jokes that sitcoms have. but -- because what you are left with is that live feeling. it's kind of like a multicamera drama or something

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