Skip to main content

tv   Bloomberg Markets Asia  Bloomberg  November 21, 2016 9:00pm-10:01pm EST

9:00 pm
potential lasted just two. a record.ping at how asianlook equities are bearing. they are going upwards. >> asian equities moving higher for a second consecutive session. we had all four major indices in the u.s. hit record highs for the first time since 1999 for the nasdaq, tao, s&p 500. that is flowing into this region today. at theseeing the nikkei yen strengthens following the earthquake and the fukushima region. are entering into bull market territory. the nikkei on friday at the topix on saturday. not too surprising. reflect there. that is coming through on the hang seng this morning.
9:01 pm
the energy players leaving the game. this is on expectations that opec could agree to supply cuts. australia up by 1.2%. korea also coming back after a shaky session yesterday. that is higher by 8/10 of 1%. the offshore revenue be pretty unchanged from where was yesterday. at 6.954 now. interesting th we have seen renminbiin the -- the raise. that is halting 12 days of weakness. the straits coming through in the you want -- the strength coming through in the yuan.
9:02 pm
this is the most the pboc has fixed the you want -- yuan. willrns on the earthquake play into the market. that pushed the the 111 level yesterday. rishaad: got a get you up to speed with some of the first word news headlines. is jumpingshipping after agreeing to sell some assets to rival k line. they will pay about $31 million for a so far unidentified part of hanjin's operations. anjin's failure highlight shipping struggles with weak demand and dropping freight rates. takatamaker tech data --
9:03 pm
as potentially narrowed ellis of buyers to just two. they're made of the race because of their experience in the airbag industry. check on airbags have been linked to at least 17 -- takata airbags had been linked to at least 17 --. deaths.ast 17 abc says 4% of the workforce. they're cutting back because they see the iron ore outlook remaining a challee. china is said to because -- a chinese insurance company is said to be buying a japanese country with $2.3 billion. a deal may be assigned this week . it will be the first foray into a japanese market.
9:04 pm
they're looking to buy assets around the world. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 121 countries. this is bloomberg. let's move to president-elect donald trump releasing a short video outlining his policy priorities as he continues to make potential members of his administration. hisas indicated his -- intention to follow through on campaign promises. >> on trade, i'm going to issue a notification of intent to withdraw from the transpacific partnership, a potential disaster for our country. instead, we will negotiate fair, bilateral trade dealers, that bring jobs back to american shores. thered: he is talking tpp and what that will mean for this part of the world.
9:05 pm
what did you make of this video? >> it is an interesting medium. donald trump making his policy pronouncements the a a video that goes up on youtube. certainly he will be the first american president to do that if he continues to do that once you take the presidency. if he does do that, if this is going to be the way he communicates with his audience, not by a press conferences or re-things, itn -- will be difficult to ask questions. there are a lot of questions and that six point plan he announced. rishaad: it is interesting he is going to do it on the first day of his administration and he will be doing a lot. what about his second day? >> second day will be resting. signaling that he is going to withdraw and put into
9:06 pm
train the withdrawal of the tpp. instead, he's going to negotiate all of the binder -- all of the bilateral agreements and these will bring jobs back to america. that is the first question i would want to ask. which countries are going to be doing this bilateral agreement, and how is he going to be able to withdraw or two bring jobs back to u.s. countries? is he going to be ramping up pressure, raising tariffs? if he does that, he will be breaking the rules that have been set out by the world trade organization. then it is a question of what it means for this new era? the is to be as the united wanting others countries to follow the rules of international trade or indeed the international rules. is is anthe thing economic problem or is it a geopolitical one?
9:07 pm
tpp is both. probably, you want to be looking at it as a geopolitical problem. this is something that john kerry has spoken of as well. withdraws from tpp, it will be governments and businesses and trade unionists and environmental activists and army leaders and navy leaders looking at this because it is of u.s. be a ceding power and influence in asia. rishaad: many say china will be the beneficiary. >> china is going to do very well. rishaad: thank you. we have some rail services in japan resuming.
9:08 pm
this comes after the earthquake and fukushima. it was magnitude 7.4 that triggered tsunami warnings. no major injuries have been reported yet. what do we know at the moment? >> i just want to update on the airport. it has now reopened. we should be able to see flights coming in their. japan airlines did also say earlier that they had canceled some. that will probably affect a couple thousand people domestically. has bullet train services resuming. the railway east is still disrupted. five people were injured. japan's finance minister was saying that there have been no reports of major dance of our. shinzo abe is currently on an official visit to argentina. the 7.4 magnitude quake did hit
9:09 pm
off the coast of fukushima earlier this morning. there were concerns about its and on the morning, possibly a three meter tsunami. the most severe warning since the 2011 quake that was a much bigger quake that ended up killing 18,000 people. there were feels of best fears about the size of what could follow. in the end, there were smaller ways elsewhere. >> what about nuclear concerns? there is concern that the damage they did in 2011 after the disaster that took place there. >> there was one plant which saw a temporary problem with the cooling system. that was knocked off-line temporarily. that was not a response of the quake, and restarted again less
9:10 pm
than two hours later. japan's chief secretary said that they are investigating the reason for this. they say they have the strictest safety rules and that safety is a top priority. they are continuing to assess the damage from the quake earlier. he has said that the system would not have immediately led to a release of radiation. power would need to be cut for about a week before temperatures in the spent fuel cooling system actually reached the upper limit. a couple of alice is probably not too concerning. rishaad: going to take a break. we'll find out if a mining giant are waking up to an iron ore hangover as prices get their first u.s. -- post u.s. election gains. .lus a video-on-demand services ♪
9:11 pm
9:12 pm
9:13 pm
rishaad: a quick check of the latest business headlines. quarter earnings beating expectations, $177 couldn says the company improve as much as $210 million in the current period. apple is said to be quitting the wireless sector to focus on the consumer products that bring its revenue. they have not updated their routers since 2013. it was a rising market, and they are up one half percent that 1.5%. u.s. authorities are
9:14 pm
investigating a crash of an enormous extent mental drone toolbelt my facebook -- enormous and experimental drone developed by facebook. it has a wider wingspan that i've boeing 737 -- than a boeing 737. let's have a look of the video on-demand market in southeast asia. it continues to heat up. we have global players like netflix and i think slamming it is part of the world -- iflix coming into this part of the world. in the ceo from singapore. actually founded in early 2015.
9:15 pm
we are asia's first streaming service, well before any of the global players got into the race. singapore this week. the emerging markets log -- largest the on-demand service during -- service area data service. hollywood plus local to emerging markets, ranging from the philippines to india. technically it is delivered over the internet where you can access any screen much more mobile uses here in southeast asia than you would see in other countries. also the web, set boxes and various other platforms. this hugeou have library. where does it come from and how do leverage it and how much does it cost? we have asia's largest video
9:16 pm
library, with over 30,000 hours. what we traditionally try to focus in on is the asian customer -- the best of hollywood and the best of local. we have 100 content providers across south and southeast asia. ofcomes from a variety sources ranging from large studios to independents. our content ranges from titles viewers would know like d.c., titles and harry potter through to great local entertainment that is specific to each geography we offer two. rishaad: where are you for the moment operating? tell me about where the growth areas are? where are you getting traction? about 18-19arted months ago, we are live in the philippines, which was our first market. we then rolled out in thailand,
9:17 pm
india, indonesia, and we will be launching in the for this week. -- in singapore this week. lester was her foundation year. we are growing extremely fast, adding about 100,000 or so every few weeks. rishaad: let's talk about your finances. what sort of cash position to usurp -- do you currently have? to have anortunate amazing and very supportive set of shareholders. we are fortunate enough to have warner bros. and sony pictures in the mix. we raised about 100 million u.s. dollars at the beginning, and are still working our way through it. it is a high fixed cost business , so we have deep pockets shareholders. rishaad: what is the return
9:18 pm
rate? your -- what is the burn rate of your cash? as i mentioned, we started out with just under $100 million announced at the beginning of the venture. we are still working our way through that. we are quite well positioned through the middle of next year. right now, we are focused on building a great business and growing and scaling across the geographies we operated. rishaad: what about chinese ambitions? do you have any plans trying to get a foothold there? market, the chinese the chinese market -- i hope many other people try to get there. you see great global players trying to get a foothold there. we like china for its content.
9:19 pm
in places like singapore and other places across the geography, great content from mainland china and hong kong china is important to us. we will be supporting the chinese ecosystem that way. i do not see us directly entering china. our ambitions look westward, actually. rishaad: why is that? is it a political reason why you will not be going there? a business sense, too? >> not really political. firstly, the internet ecosystem is very different. there is no google, no facebook. the traditional model and things succeed inild to southeast asia do not apply in china just because the ecosystem is different. market constraint
9:20 pm
is very different that does not necessarily leverage our strength and rochus. -- and focus. those are just a few of the reasons. we are in a footprint of 1.6 billion people today. that is quite big enough for us right now. we are looking to expand in other countries across southeast asia and beyond. you keep on bringing up content. what about original content? do you have any plans for that? content i think is an important factor for all players like us. it is not fundamental to our business model as say a netflix is we are actually the first player in the region to announce and produce original content in the region. we are in production with our first original. in the philippines, to be released in december.
9:21 pm
it is a miniseries. we will be announcing original content in multiple countries over the next few months ahead. rishaad: what about hong kong? any plans there? >> you never know. we do not have immediate plans for hong kong, but we do like the contents that plays in hong kong. there are many aspects of our content that is relevant to hong kong. you never know. look for great partners. if there are great companies that want to partner with us and expand into a region like hong kong, we welcome the invitation. rishaad: thank you very much. the chief executive of hooq joining us from singapore. coming up, the cash crunch in india is continuing. questions grow over modi's move. this is bloomberg. ♪
9:22 pm
9:23 pm
9:24 pm
sports thedia biggest loss and asia unmade fears that the economy will be heard on high denomination bank loans. it is an anticorruption measure, we're going to get more from our correspondent. how bad are things? what are people saying? >> let's just say it is not looking pretty. for six days, the longest losing streak since december last week. it has erased all gains for the year. slumping to their lowest in months. it is not surprising. thestors do not quite know
9:25 pm
extent of destruction and the impact of the no debts of the new currency issuance. once they are sure there is a cash crunch after modi scrapped 80% of currency notes in circulation. demand to be heard at the time when investors are expecting company profits to pick up. there have been good months following a bad drought. the gdpexpect a cut in forecast for the next two quarters. not looking good for india at all. problem this clash will -- what larry sanders make of it all? says india's cash fan will not fight corruption. what it will do is hurt ordinary citizens, mom and pop businesses. in his words, those were the largest amount of ill-gotten gains do not hold their wealth
9:26 pm
in cash. they have also turned it into foreign exchange, the likes of gold or bitcoin. that is not the hugest, most problematic ones. summers himself has advocated the end of large to nominations the u.s. and europe as well. the same argument cannot be made for india, and that is because it is a poor nation. he says the currency measure will not have lasting benefits. the 500 rupee note is widely used in india. compare that to the $100 u.s. bill, rarely used by even the richest americans. that.d: thank you for you're going to have a thick look at the trading day across the asian pacific. into itst getting lunch breaks, giving up some of its early gains. it has been on an absolute tear,
9:27 pm
a formal bear market. up, a look at jakarta's say or -- shares. they have shortlisted to bias for the company. ♪ seeing is believing, and that's why
9:28 pm
we're opening more xfinity stores closer to you. visit us today and learn how to get the most out of all your services, like xfinity x1. we'll put the power in your hands, so you can see how x1 is changing the way you experience tv with features like voice remote,
9:29 pm
making it easier and more fun than ever. there's more in store than you imagine. visit an xfinity store today and see for yourself. xfinity, the future of awesome. donald trump has outlined his policy priorities, including dumping the transpacific trade partnership during his first day in office. spoken to more potential cabinet members, including high-profile republican rick perry, newt gingrich. tsunami warnings in northeastern japan have been downgraded after a earthquake. thousands of people living on the coast were warned to move to high ground, but no major
9:30 pm
damage has been reported. pboc ended a record run of yuan weakening. that is the first time in 13 days and has raised the rates from the proceeding one. advisor hasboc called on the bank to accelerate depreciation before donald trump becomes president next year the bank of japan's governor says it is too early to talk about a strategy from the new bond buying program. kuroda said it is also premature to discuss how it will allen sheets.ce its thglobal news 24 hours a day, powered by 2600 journalists and analysts in more than 120 countries around the world.
9:31 pm
this is bloomberg. rishaad: this is bloomberg markets: asia. let's see what is going on with that japan lunch break just upon us. juliette: of course, investors are really reacting to that earthquake today. the nikkei is going onto that lunch break pretty flat there, fairly unchanged. but the nikkei is on bull market territory. and also, japanese equities have been on a tear over the last eight sessions. we can see little bit of an upside coming through, but it is fairly flat into the lunch break. hong kong is looking incredibly strong today. that is really a story, as energy players push the index higher come up by 1.4% on the hang seng as oil trades higher. galaxy, up by over 4%.
9:32 pm
the australian market, also taking a run on these higher oil prices. 1.3%,x 200 is up by though it did close in the red yesterday. also, a little bit of flat movement coming from new zealand yesterday. takata did not had a very solid session yesterday. of course, we have seen the pboc actually strengthened the yuan for the first time in 13 sessions. we can see little bit of an upside on the shanghai composite, up by 0.25% and trading a 10 month highs. taking a look at some of the movers in particular. we will talk more about taka ta, but it is coming off of the rally in yesterday's session. its company and power plants have been unaffected by the quake this morning in fukushima. santos is one of the best
9:33 pm
performers in that oil space in australia come up by over 3%. let's check on the crude oil. new york trade, moving toward the $50 a barrel mark, up by almost 1%. oncourse, this is all the speculation that we could see supply cuts from the opec members. shares were takata up, but they are retreating at the moment. there are reports that there are a list of potential buyers. let's have more on this. david is in tokyo with why these two have an advantage. they do have a lot of experience in the industry, so it seems quite reasonable. reporter: they do and they have the testing and quality control technology that is necessary. the rival bidder only makes part of the airbag component and therefore, they would have to use takata's testing.
9:34 pm
that has actually been under question. and part of cleaning up and moving forward with automakers as a supplier will be revamping the quality control. they will be a lot of focus on that and these companies have that already in place. so, from the automaker's perspective, it is much better to go with a company that already has that in place and the two main ones would be autoliv and key safety. rishaad: we are talking about the biggest vehicle recall in history here. the potential liabilities for a buyer could be massive. david: they are. there are a lot of moving parts to this deal. look at everything from antitrust, which is one thing that could kill the deal. autoliv is the number one provider now. this kind of acquisition would give them more than 50% of the global market for airbags. that is a concern.
9:35 pm
there is also a concern there could be further recalls, that the takata recall is not believed to be finished yet. so, there is the risk of that. the people that we have spoken s. about this deal say a u. bankruptcy would still be part of this process, and that is pretty complex. and before you would know exactly what assets would be safety'sto key balance sheet, you would have to know how the bankruptcy would be structured. there is a lot of riskier for the investors in either of these companies, and going ahead for takata as well. that we do know they are moving toward this. it is a very highly distressed asset. so, there will be some deal and these two are in the position to get it. rishaad: thank you very much, dave mccombs. we have got something bonds.
9:36 pm
we could be heading for even darker days. we have the possibility of a triple whammy. steve engle, tell us a little bit more. steve: sounds good. triple hammy. rishaad: seriously, tell me what is going on. issues, youhree have accelerating inflation, you have the weakening yuan because of the outflows and the potential fed action coming next month, and you have a cash crunch as the authorities are trying to contain asset bubbles in property. so, 10 of 19 traders that have been surveyed by bloomberg say 10 year sovereign yield could reach, on the sovereign bonds in china, could reach 3% by the end of the year. the 10 year is widely seen as a benchmark for things like mortgages. the securities company in beijing says all these three factors are negative,
9:37 pm
to that estimation. the market is entering the 2013st period since the cash crunch. rishaad: does that data tell about the dark days ahead for the bond market? we did not get to the charts last time. reporter: these charts will illustrate what i am talking about. first of all, i talking about inflation. cpi is now up to a six month high. it is only 2.1%, getting up to the government's four year targe t. plus, the producer factory index has now dipped into inflation. this is small, but after four straight years of deflation. the factory gate commodity rising, which is the leading indicator for bond yields. the blue line is the ppi. there it is. there is the ppi.
9:38 pm
and the white line there, that --the rishaad: this is the yield advantage. reporter: this is the yield advantage because he of the premium between the chinese 10 year and the u.s. 10 year. the blue line there, the yuan, is weakening by 60% against the dollar. that is leading the tighter liquidity into those outflows, which leaves very little room for authorities to ease any further. now let's go to the third chart, ok? this is about the cash crunch. other his to prevent asset bubbles from performing in particular properties. the pboc is heightening cash supplies but using longer-term averse -- rishaad: we are talking about interest rate swaps.
9:39 pm
reporter: we are looking at a 10 month high. rishaad: i can bring that up. there we go. reporter: thank you very much. those of the various cash crunches we have had over the last five years, though the big one was in. 2013 -- was in 2013. now we are heading for darker days. rishaad: thank you very much indeed, steve engle. iron ore gains are about to turn to rust. why the good times or maybe coming to an end, or will they? this is bloomberg. ♪
9:40 pm
9:41 pm
iron ore postings uprising gains, spiking 6% today. some analysts say these good
9:42 pm
times will be around for much longer. let's get over to sydney. what is this outlook for iron ore? what are people saying? >> well, let's take for example, davies. he is saying the speed of the recent rally in iron ore leaves it open to the fact that the price action has been much too fast. let's look at the price action on the index we have followed. that touched $80 for a time, which was really quite apressive, but there is decrease of 8.8% in the last week, the first weekly drop iorn ron ore has experienced in the last two months. china is cracking down on speculation again. analysts are saying iron ore should continue to ease off.
9:43 pm
rishaad: paul, despite those stocks prophecies, mining are doing alright today, aren't they? yeah, everything is doing today and it might have something to do with the really impressive lead we saw from the u.s.. take nintendo for example. that is 1.5% at the moment. they are getting ready to lay off 500 employees in the iron ore division in western australia. we are not concerned with those numbers, but that does not mean they are not looking at job reductions. have a look also at fortescue metals. that is an interesting one because their product is iron ore, so that is a good prospect where the market is heading. fortescue is also performing well today, up 3%. rishaad: producing iron ore f rom the mines in russia, as well
9:44 pm
as in northeastern china. let's get more on the market. tell me about it. what is it like? it has been quite a year if you are an iron ore producer, miner, or investor. quite a few interesting years. >> for us, it has been an exciting time just recently. we have been moving our mine after a long time of construction. we have reached levels up to 60% capacity. rishaad: that is your big one, isn't it? today,the mine producing 3.2 million tons each year. we are in the process of upping that. rishaad: high-grade iron ore as well. there are some a different grades of iron ore.
9:45 pm
ultimately, you cannot talk about the general picture. >> it is very difficult with something like iron or ore or coal to talk apples to apples with products. we have never had a problem finding a market for our product. if you look at some of the lower grade products, so the standard grade is 62%. sub-60% there are products coming out of australia which are struggling to find a home. they are the ones that sit there often in beijing and cause trouble for the market. rishaad: we do see these iron ore producers, the likes of rio, producing more and more iron ore. the cynic inside me would say they are trying to drive other people out of the business. am i being far too cynical? >> i don't think it is for me to comment on rio tinto. rishaad: generically, are big
9:46 pm
miners overproducing? >> definitely, there was a period of greed amongst the iron ore companies. you saw the goose that laid the ofden egg suffering a period very bad health. some of those geese were destroyed, but we have now reached a. -- but we have now reached a period capitulation. his in the price uptick -- we have seen the price uptick a bit. we are now around $80. moment. $70 at the right, what is it telling us about the market at the moment? is it leveling off? what do you see on the demand side of things? that is crucial. >> from my perspective, he goes back to the specific window into
9:47 pm
the market. for high-grade materials, that has never been an issue, in terms of demand. for the good materials, there have been more complications. those complications stem from your ability to take that material, your ability to find credit for that material. one of the biggest impacts on the iron ore market in china has been the ability to find credit. it is far easier to find liquid credit for a high-grade product. rishaad: looking to next year, what is the supply side looking like at the moment? will we see some ramping down? what do you anticipate? >> there has been a process of slowing of supply growth, which is definitely set for the next five to 10 years, in my view. the ability for the market to off-line has mines definitely been proven in the last few months. some of the majors have been taking off mines in the till
9:48 pm
pilborough. rishaad: where does that lead to when it comes to the price forecast? >> i think when you have seen the price growth, as you have seen over the last few months, it is very difficult to provide a forecast. i think there is the floor at $60. as to the upside, i sit there and watch. risha: but the shareholders are going to want to know. >> my shareholders i think are very happy right now. there is a realization in the market -- rishaad: guys, can you bring up a year to date chart on irc and what they have been doing? let's have a look at this. there we go. this is year to date. steady as we go, going down, down, down.
9:49 pm
and then subtly may into july, huge ramp ups -- and then suddenly, may into july, huge ramp ups. we have seen the biggest move in the last two weeks. having said that, you have a perfectly legitimate excuse. >> it has been a long time coming. and i think that those shareholders that stuck with us during that period will be rewarded. there were some tough times. i am a large shareholder myself and i have watched the price collapse. i am pleased to see a little bit of recovery. rishaad: a little bit of a recovery. do you know how much your stock is up today? >> i think 15%. rishaad: 20%. >> 20%, excellent. isr term realize asiaation excellent. we have reached levels up to 60% capacity for this project. it is one of the lowest cost iron ore mines in the world.
9:50 pm
$82 million is the forecast? >> it is a little bit more today. so, this is permanently profitable now, this mine? >> i would hope very much that the future is very promising. rishaad: thank you very much, jay hambro. up next, why the $100 billion chinese city becomes the stuff of real estate nightmares. you are watching bloomberg. ♪
9:51 pm
9:52 pm
rishaad: you are back with "bloomberg markets" and we have a look into the latest is a business flash headlines. we are looking at the biggest merger in the u.s. health industry. in the market impact of this $48 billion deal. government lawyer said it would reduce consumer choice, but answer with lower costs for health which would then pass the savings on to consumers. china says it has broken the stock manipulation ring worth more than $400 million in shanghai and hong kong. it is said to be the first case of its kind in two years.
9:53 pm
sharesg bought and sold to ramp up trading volume and create the impression of bullish sentiment. $6 million were made on april 15 alone. beijing has announced a new smog warning system with a red alert being issued as the city's air-quality alert reaches an arbitrary level of 500. schools and factories are shut down temporarily. the u.s. embassy's air quality rating was 21 at dawn today. the relationship between that index and the one china is putting out remains unclear. let's have a look at china's property developers. they are betting mega-sized foreign projects would offset the buying slowdown they see at home. though there might be a cautionary tale to be seen in a $100 billion city in singapore. optimismlking about
9:54 pm
here over this project. give us a sense of the ying before the yang. >> there is a sense of whether this optimism is misplaced. biggestchina's therird sale, pumping in $3 billion. that is in the southeast of malaysia. chinese buffers see the profit popping up in this region, but while they are optimistic, there is concern that there could be a surprise. as they built thousands of new homes in an attempt to lure chinese property hires, and local property buyers, there is what we are seeing, a depression in property prices. -- pricesell about fell about 1/3 last year and
9:55 pm
this compares to the national fall of 11%. rishaad: this is cause for concern. >> absolutely, but country is connectedmism to the economic growth. rishaad: they are not being pessimistic, are they? is aservers say there mismatch really raising red flags because ultimately, they will be an erosion of profit margins. developers offer very few discounts. rishaad: sophie, thank you very at johor'soking development. let's tell you what we have coming up ahead on "bloomberg markets." haidi will be updating us on the big stories. what is on the way? haidi: donald trump is laying
9:56 pm
out his priorities for the first 100 days in office. which weping that tpp, are not surprised about. we want to know what this means for asia. also onget the latest the powerful earthquake that shook japan early this morning. the latest on those tsunami warnings and evacuations. we will be going live to tokyo for that story. also, counting down to the opening of trading in mumbai after indian stocks posted the biggest loss in the region yesterday. is this anticorruption drive causing short-term pain for longer term gains? the dollar story, the front and center when it comes to asian trade today. this is bloomberg. ♪
9:57 pm
9:58 pm
9:59 pm
10:00 pm
>> from our studios in new york city, this is "charlie rose." charlie: david is the editor of the "new yorker." he recently sat down with president obama two days before the election and two days after the election. the two delve into the campaign, the media, and the president's legacy. he offers a firsthand look into the mind of president obama, as he reflects on his successor and the future of the united states. the piece is called "it happened here" and is the lead issue of

10 Views

info Stream Only

Uploaded by TV Archive on