Skip to main content

tv   Bloomberg Markets Asia  Bloomberg  January 30, 2017 8:00pm-10:01pm EST

8:00 pm
rashaad: it is 9 a.m. in singapore, the day in sydney and 8:00 in the evening in new york. you're watching "bloomberg markets asia." ♪ rashaad: taking the lead, u.s. stocks fell the most since the election. gold and the yen are advancing. sentiment is watching -- sony is watching a horror show. names attack trumps travel ban, leading the way act up by silicon valley and the
8:01 pm
justice department. eating straight to the market close, we do not have an open in many parts of the region because it is the lunar new year holiday. having a look at what is going on in commodities and more. mentioned, we have the markets like china, hong kong, and others closed due to the lunar new year holiday. commentseing trumps weighing on investor anxiety and you are seeing consumer and material stocks during the most on the regional benchmark. japanese automakers toyota and honda among the largest lacquers and in the backdrop we do have gold holding two days of gains and positive in oil after the
8:02 pm
overnight movements. electronics, autos and machinery makers looking at the yen gained some ground. its forecasted dropping as much as 18%. the biggest decline on the intake -- nikkei and the topix. it dropped its operating profit outlook two 70%. a negative here and it is likely to persist if there is not a drastic change in reggie according to analysts. direction, we have sydney moto chemical rising even after it announced a profit drop of 20%. the weaker yen among the upside factors driving the earnings there.
8:03 pm
other parts of the regions, we had the kospi dropping. whom died likes of moments following -- elsewhere, not reflected here we do have key a motors jumping to the lowest since 2010 on worries over u.s. sales. sliding, we have it lower for a second day. we have iron ore miner, fortescue metals hopping a gain of 2.6% here as it had steady outlook and falling costs help it could be estimates when it announced its latest results. we have a beleaguered organic my's on ar bella four-day higher. rashaad: let's get you to the first word news and headlines.
8:04 pm
pickew president trump's for secretary of state, the senate voting and his nomination is expected to go through even the critics highlight his links to president clinton and russia during his time as exxon mobil ceo. deutsche bank will pay $425 million in new york to settle allegations that he helped -- that it helped will be launder billions of dollars. it relates to so-called ameritrade handed -- handled by moscow's door to office in 2014. georgia looking at paying on the same charges in britain that could be in the hundreds of millions of pounds. the ceo saying that the fears about the company, he criticized
8:05 pm
reports about toshiba improving its internal control. finalize thoseto losses when it reports on february 14. it may cut its holding in westinghouse from the current 87% although it is unclear how easy it would be to find a buyer and unintended five toshiba saying it is selling its stake in westinghouse although no statement has been made yet. we have the world covered. sony having a bit of a nightmare, falling the most in three months after announcing a $3 billion turned down at the movies. it hasn't been that bad, but yes, generally sony has been indicating for a while that
8:06 pm
things are not too great at its movie business and now it is said that it is going to take a $1 billion write-down in its new business is due to diminished future profitability. this relates to a goodwill charge when it purchased columbia pictures and 1989. it says you will see a lot more closely how this is going to impact. essentially it has been let down by some movies out recently like "ghostbusters" and "angry birds". movies had been where they were trying to focus on. after sonytwo weeks announced that it entertainment ceo was leaving and he was stepping down after 13 years. we saw back in june sony had
8:07 pm
warned that the media unit was at risk of posting more losses. the projected low profit margins for fiscal year 2018. rashaad: what is next. do they have a roadmap to get themselves out of the mire? >> they may be looking for a clear roadmap. they're going to sell this medical web service m3 and that is going to go to goldman sachs 4.8n to unit for about million u.s. dollars. they're trying to oversee a review of the movie division and find a replacement for michael linton. onorts will concentrate expanding globally and making more use of sony entertainment's intellectual property. they also mentioned domestic changes in the -- dramatic changes in the industry such as
8:08 pm
things like dvds and blu-ray not doing as well as they expected. when was the last time you bought a dvd or blu-ray? rashaad: i camber. over a year ago. not too gloomy on prospects for the pictures division. indeed president trump of course making all the headlines. under attack from all sides, , siliconet big names valley and the acting attorney general. >> let's start with the most recent development, the acting attorney general sally yates. she is the highest official that still is a holdover from the obama administration and then in the past hour and a half or so, she said i'm not going to defend the immigration and that donald trump signed and that executive
8:09 pm
order. is a huge symbolic slap in the face but it doesn't have much teeth because the attorney general pick jeff sessions is expected to be confirmed by the senate and he will tow the party line and the trunk line -- trump line. we have wall street executives saying they are not so happy with that immigration ban. look atong them, let's goldman sachs ceo lloyd blankfein i. he says this is not a policy we support. think of is not optional. goldman sachs rarely comments on a sitting administration and after goldman sachs a lot of people are known to go into the government sector.
8:10 pm
lloyd's replacement is now in the white house -- a softer approach. stress benefits of national security, said he was grateful for our country being safe and it is those strengthened by the richness of diversity. also we have blackrock ceo larry fink weighing in. this is the world's largest money manager here. also doing a little back and forth talking about security and also talking about the importance of due process as well as individual rights. those are some of the banks that have weighed in. wells fargo as well as morgan ,tanley say they are monitoring but bank of america and citibank has so far declined comment. they are just of the latest in a series of other ceos who have come out a little more swinging,
8:11 pm
especially in the tech industry. look at all these names. apple, google, twitter, netflix, all of these have been slamming this immigrant a band. apple ceo tim cook saying apple would not exist without immigration. -- donald trump also has financial regulation in his eyes. he is looking at this 2010 dodd-frank act. when is the latest of their -- latest there? >> he wants to chip away or do entirely away with dodd-frank. that came into existence after the financial crisis to protect consumers. >> it is almost impossible not to start a small business and it is virtually impossible to expand your existing business because of regulation and the banks don't loan you money. dodd-frank is a disaster.
8:12 pm
>> the opening salvo at chipping are on dodd-frank but you going to be sure the democrats will make sure dodd-frank will stay alive. rashaad: of course expecting president trump to announce his nominee for the supreme court. that is tuesday evening in the u.s. and 9:00 on wednesday morning if you are here on hong kong. also looking ahead to that all-important meeting by the bank of japan. we will be seeing how bank of america merrill lynch expect that discussion to play out. what will that central bank due to control the yield color -- curve? ♪
8:13 pm
8:14 pm
♪ rashaad: you are back with "bloomberg markets."
8:15 pm
possibility of a strike at a copper mine in chile. union say workers are overwhelmingly in favor of actions. 's latest payng bhp offered by 90-1. vodafone may be looking to create india's biggest mobile phone characters -- carriers as it looks to merge with idea carriers. havecurrent company would equal rights with vodafone in this a body. idea shares charging -- surging in mumbai. daiwa securities saying it is for its newdublin
8:16 pm
headquarters. it says london will remain the main location for most of its regional operations. daiwa has about 450 employees in europe, mostly in london. they announced a 1% rise in profits and changes to management. it is the bank of japan wrapping up a day two of its policy meeting a bit later. now global economics and policy editor is in tokyo, what are we waiting for? what are we expecting? expecting some signal from the bank of japan led by governor kuroda on their assessments of the economy. are they getting a little more confident in the economy? our bloomberg survey of economists say no change and everyone else we have spoken to agrees. what is key here, they're going to keep the key rate, the short end at -0.1%. the negative as governor credit
8:17 pm
would say. the 10 year at 0%. watch governor kuroda's comments about the exchange rate, the yen, would he like to see it weaker than it is now, it is weakened a lot and now it has rebounded. that could move the market. industrial production, it slowed in the latest month but the forecast. there could be a boost from exports. that could lead to the bank of japan boosting the bhp forecast. they are not going to move that. we spoke to a former bank of japan policy member, she says it is time for the bank of japan to realize monetary policy cannot do it alone. fiscal policy has to step up and get the economy moving. has done enough. now the government has to
8:18 pm
increase growth and conduct a more growth oriented strategy. it is interesting that she says the bank of japan is mistaken if it is going to follow a policy of trying to count on a weak yen to boost exports and the economy. fundamentals would have the yen -- t $1.10 on theo dollar. rashaad: what about this yield curve control they have been involved in, buying bonds to keep rates at zero? when we looking for here? no change, there is too much uncertainty. uncertainty from within
8:19 pm
japan and the economy, it is now the donald trump factor. he has raised uncertainty about trade and now this claim down on immigration. she says that is going to hurt or potentially affect confidence . the corporate sector, they are willing to do or not willing to do. yield curve control policy has to be changed. i did they have to target the quantity of bonds we purchased or with they have to target the level. this is a part of their policy -- she said was not sustainable. when it comes to currency, we're going to be talking about the fx strategy. we'll be talking about what he sees for the boj and what it means for the dollar-yen exchange rate. we will have the policy decision live when it comes somewhat yoternoon to get time -- tok
8:20 pm
time. here on bloomberg television, live in tokyo. you very much indeed. we are going to be talking about the weakness of the yen because it has been proven to be a boost for japan exporters. ♪
8:21 pm
8:22 pm
♪ rashaad: having a look at equities in this part of the world, taking their cue from u.s. docs which -- u.s. stocks t donaldl in response to trump's risk appetite. >> we have just written poorly reports to clients to explain why. because theularly
8:23 pm
policies of the u.s. ministration are pro-growth. i am struggling with the contrast between upward looking economic policies along with policies that counter the benefits of diversity. this is difficult because clients are quite concerned and if it went on to much longer where u.s. granted an approved visas were rejected at the border, investors would run for cover and this would not mean short-term, modest weakness in equity markets, this would mean a plunge in equity markets. it is important that we stand back and look at this and listen to some of our leaders. mr. blake find, the head of goldman sachs, made a good point. i wish jpmorgan and mr. diamond should have followed suit and i think the opinion on wall street should be clearer. is what bill the u.s.
8:24 pm
and it is what the u.s. celebrates. in terms of corporate profits, without the west coast tech sector which is reliant on visas and immigrants to upgrade the standard of their work and be inventive. without those people, the u.s. tech sector and u.s. profitability with all and it will be dangerous. recognize valuations at the moment are high. optimism about the election, but if this goes on, all bets are off. rashaad: how much risk premium can build into equity markets or other markets? we don't know what is going to happen because there have been so many executive orders and this latest one seems to be ill-conceived and badly thought out because there has been so many attempts to explain what it is trying to get to. >> if national security were dealt through with a longer term
8:25 pm
visa plan, that is the approval or disapproval of the set applications, investors would understand that. approveding a visa as and then knocking people back to immigration is unacceptable. investment markets are terrified inand i don't think the ministration gets that. i'm looking closely at the supreme court appointment because some of the people being considered for the supreme court appointment have policies that are really quite mad and we have to make sure the legislative blanche -- legislative branch and the judicial branch are there to do their job. in the u.s. system, the president has the right to you executive orders and he is using this right in week one to the extent we have never seen. rashaad: doesn't this make you and your client look away from at some of theok emerging markets or at japan with their rate decision this week?
8:26 pm
if so, what do you look at in particular? markets, weemerging recognize and emphasize to our clients, the emerging markets are traditionally correlated with commodities as many of them produce commodities. the environment we are in now should be a positive for emerging-market. investors have bought the u.s. dollar, therefore hurting emerging markets, that i would say in two or three years time, that colby a good call and emerging markets will have rallied. likewise, commodity producers like australia, canada, south africa, you'd expected this environment to be good for them. we will not get all with infrastructure spending into legislation is passed and the president will not get legislation passed if this carry investors willd freeze investments on the united states until they are more confident. rashaad: john, thank you.
8:27 pm
great talking to you. coming up, why workers at the world's biggest copper mine are looking at setting down their tools. ♪
8:28 pm
8:29 pm
rashaad: just looking at what we have in store. we would normally be running up to the start of the trading day in shanghai and hong kong. that is not happening due to the start of the lunar new year/ . datais on the heels of showing the jobless rate at 3.1%. industrial production down by 3% -- up by 3%. we are also looking at the most important data point of the
8:30 pm
month and that is the payroll report, looking at unemployment to remain roughly the same in the u.s. looking at that decision which is going to be looked at closely. unemployment rate expects to say at 4.7%. actionet to the market and give it back to set the camera knee. phie: interesting wiki given what you detailed around the central bank meetings and we have several earnings to keep an eye out. we are not exactly thing investors flee en masse. treasuries little change and japanese shares dropping the most in the region, down almost 1% there and elsewhere. taking a look at some movers in tokyo and elsewhere in asia.
8:31 pm
computer and telco equipment maker nec plunging the most in six years as it slashes its product forecast. the biggest recliner on the nikkei 225. credit suisse says third quarter results for the company was surprisingly weak and approving targets will be difficult. attaching construction has performed well your today -- h -- we donstruction have key a motors following the most since 2010. suspects thes rebound in the first of this year will be difficult due to slowing demand not only at home but in the u.s. and australia.
8:32 pm
help dropping the most. it warns its drop in the market share will have a material impact. fortescue's metals rising 2.47%. rashaad: thank you. let's have a look at what is going on elsewhere. as look at some of the first word news. president trump is under attack from all sides today over his controversial travel ban. the acting u.s. attorney general says she will not allow the u.s. justice department to defend the order. says theachs boss order is something the bank cannot support while blackrock larry fink called for respect. the japanese prime minister is
8:33 pm
pushing back at white house criticism about auto sales. president trump says the two-way trade in balance between japan and the u.s. is unfair but shinzo abe says there are reports of poor sales for american cars in japan. indicated that on his will be a contentious issue in any bilateral trade negotiation. canadian police have charged a man with the quebec mosque people andat killed left others in intensive care. investigators still have no motive for what is one of canada's worst attacks, but please are thinking it was terrorism. president justin trudeau described it as a act of senseless violence. hersche bank will pay for $25 million in new york to settle allegations that it helps wealthy russians launder millions of dollars. allegations relate to the so-called ameritrade handled by
8:34 pm
moscow offices in 2012 and 2014. which is close to a settlement in the u.k. which is close to the hundreds of millions of pounds. reports from india say the government expects higher oil prices to drag on growth this year. the finance ministry shows oil climbing up to 15%. risks include global trade tensions and the ban on the high rupee note. news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. thanks very much for that. let's look at what drove this u.s. markets to their worst session since the presidential election. let's join su keenan in new york. su: let's talk about volatility. it was the highest in five months. .t was up from 20%
8:35 pm
a 12% gain after a decline. they look at a snapshot of the market. the dow was down triple digits down to under points at the worst of the day. gold and bonds of in a flight to safety -- up in a flight to safety. tech was down but apple and amazon will be reporting numbers . google, out of company, interestingly enough, created a find that will give us as much -- fund that will give as much as $4 billion to legal agencies that will help this caught by this travel ban. that is one company speaking out action.the latest trump this is down market is what it looks like when wall street gives a thumbs down to donald trump.
8:36 pm
oil was lower for a second day, the going into this week, we saw a big surge in bullish bets as opec is about to complete its first month where it is on track for a cut in. roughly 900,000 barrels. that is where we head as we go into tuesday, and it is setting up to be a volatile week. thosed: let's talk about caught in the middle of his a travel ban. they are worried about investors and people getting on their planes. su: biggest drop in seven months. it was chaos around the country here in new york at jfk. protests, more than 100 people caught in the middle of this travel ban. companies worried about their workers being caught on the wrong side of this and if you go into the bloomberg you can see going into this week, airlines
8:37 pm
have been one of the best-performing sectors since the election and they did a reverse in today's market. now the most in seven months and for each airline it was a 3% or 4% decline, whether the delta, american l-1, american l-1, the people will be reluctant to travel because of the chaos and other nations could possibly retaliate out of discontent with trump's latest actions. rashaad: today's decline coming despite positive economic news out there, despite the rebound in housing and the rise we have been seeing because of the bond market and the rise in mortgage rates. su: u.s. penny home sells rebounded and this is despite the higher rates. the big question, can that
8:38 pm
rebound be sustained as mortgage rates rise and the question -- the answer to the question is yes. he can the bloomberg and see as of the interest rates have risen, so too is the sales rates for home. in early 2017, that recovery on track. thes go back into bloomberg, because consumer spending is also on the rise. consumer spending is up and those are two big positives when you consider the very big data out on friday. the first labor report of the new year. politics appears to be eclipsing this economic data. thanks, and people talking about politics being the alpha and it is turning into the outlook when it comes to market participants. let's look at what is going on with the world's biggest copper mine. workers likely to go on strike and with the owner of bhp
8:39 pm
reaching an impasse. what do we know at the moment? we're are we with this? we are in this three-year agreement between the escondida mine and the union that expires today. the pressure is to find a solution. to put 5000 -- 2.5 thousand theers have been voting and union representative says they are 99% likely to reject the offer that is on the table from bhp. rashaad: this dispute boils down to money, doesn't? beat., there is a paid for theoes down a mine warm, fuzzy feeling it gives them at four years ago these workers were offered a $49,000 bonus which is generous continue
8:40 pm
-- considering what other minors will get around chile. bonusions want a 38,000 instead of a 12,000 bonus, bhp is not going for that. the union's argument is production is up in laboring minds as the prices up as well, said the workers deserve a cut of the action. wary of locking itself into another multiyear long contract based on what today's prices are doing which are conservative based on what the copper price might be headed to. it looks like it is headed towards strike action. rashaad: some of australia's other resource stocks also having production numbers. fortescue, did pretty well after a strong quarter. selfie mentioned before, fortescue shares back on the asx.
8:41 pm
42.2 million pounds, that was a narrow the, but the big plus comes with the cost reduced. very low cost producer, fortescue, they were also paid $1 billion in debt. the markets really enjoying the good news coming out of fortescue today. we're just energy also had a good set of production numbers for the quarter. oil and gas up about 47%, that is on the queens land lng starting up. but those production numbers and the revenue numbers missing goldman estimates. we were expecting a little better than that and origin shares a down 3% right now. rashaad: thank you for that. we are going to be telling you what is on the way from weight watchers.
8:42 pm
our next guest expecting to hear a rather repetitive message from governor kuroda. we are heading back to tokyo and will be outside the central bank getting bank of america and merrill lynch's take on all of this. ♪
8:43 pm
8:44 pm
♪ we are going to take you to tokyo now and get to kathleen hays who is standing by with our next guest to is just outside the bank of japan. next movel bank's coming in the next few hours or is it? kathleen, what is going on? great to be here in tokyo today. inc. of japan will be wrapping up that meeting in a couple of hours. governor kuroda holding a press conference which we will be covering as well. i'm joined by the chief japan for bankand strategist
8:45 pm
of japan merrill lynch -- japan merrill lynch. expectation for them to do or not do? >> if you look at the economic activity, inflation will probably recover in the second half of this year. there is some optimism for the boj but we are facing great uncertainty on the trump administration. for doings criticized monetary easing back in 2006, that i think they will be quite unsymmetrical in terms of exit talks. they will be very careful about not sending a wrong signal about commitment to inflation. -- >> we know they're going to keep the key rate at -0.1. rarely negative.
8:46 pm
the 10 year yield, anchored with the tenure control at zero. that we expect not to change. the question is, do they boost their economic assessment? do they used their inflation forecast? >> they will not boost growth forecast, but probably key inflation forecast. boosting its forecast since the wrong signal. there has been talk about the technical tampering because the boj has technically reduced the amount of repurchase due to the wisconsin the of the gdp in the market. nothis coffee the -- it is monetary tightening and they are committed to achieving 2% inflation in the coming years. >> donald trump already created a lot of uncertainty right after positiveion but
8:47 pm
uncertainty. it boosted the dollar and bond yields in the united states weekend the yen, and now some of the latest, the trade deal, complained the dollar being too strong and the one that is reverberating globally is immigration control, so much concerned about that. what does that mean for the dollar-yen? >> there is a clear contradiction in president trump's politics. fiscal easing is massively positive for the dollar, on the other hand they are already saying the dollar is too strong, which i disagree. the only solution at the moment is if the dollar actually gets too strong, then it might sound less contradictory and that is the dollar-yen will shoot up first into the spring. >> will that help boost exports?
8:48 pm
is that a good move for dollar-you? -yen?lar >> at 130 it will make import prices too expensive for the japanese economy, but the bigger concern is currency diplomacy. speaking of currency diplomacy, prime minister abe is going to be meeting seen with the donald trump. surely they are talking about hammering out a bilateral trade deal, is it going to be a contentious issue, how japan manages its current when the president of the united states is already complaining about the yen potentially being too weak and the dollar too strong? >> i think any potential deal proposed by donald and the administration is likely to have intention to prevent dollar from strengthening or even reasoning
8:49 pm
-- strengthening the dollar. it support base is political conservatives and if the trump suchistration is on currency policy, we will face to tariffs. vacancies to easily, he will abe canblems in -- if easily, heedes too will have a problem domestically and the other risk is the breakup in u.s. and japanese security alliance. >> what you see for equities if you look at the bank of japan holding tight. you see the fed singling -- signaling something at their meeting. isdiverging monetary policy
8:50 pm
straightforwardly positive for the dollar-yen and that means higher equity price in japan. if the dollar-yen overshoots on diverging market policy, it may be knocked off for the u.s. administration. >> thank you for joining us today on bloomberg television. he is chief japan currency strategy -- strategist at bank of america merrill lynch. more guests coming up live on bloomberg television at tokyo. rashaad: thank you very much. coming up next, summers slams trump. treasury secretary has some harsh words for the white house. we'll cut you would be our next. ♪
8:51 pm
8:52 pm
former u.s. treasury
8:53 pm
secretary larry summers has come out against president trump's immigration dan, calling it chaos, counterproductive and costly. we are still waiting to see but we expect from the administration on fiscal policy. >> each market persistent will have to make their own judgment. i am fearful that what we are seeing in markets is a sugar high. that does not mean that they can't go higher, it doesn't mean it can't happen for quite a while. i am the last person to claim to be able to time markets but it does seem to me that there is a kind of euphoria that assumes that tax policy is going to pass fast. i'm expecting that is going to be very difficult. that confidence is going to remain strong. i'm not so sure with erratic
8:54 pm
actions like the ones that we saw and that provocations to the world are not going to be responded to and i'm not sure that is a good bet either. that is not a judgment that could be a basis for near-term investing. error isink is a clear to confuse a several months of strong markets with strong fundamentals. the period postelection when markets did best in the 20th century was the time between herbert hoover's election and his inauguration. as a presidency, that was the biggest economic disaster that we had. i don't know what is going to happen next in markets, but no one should be serene is because markets are behaving well.
8:55 pm
rashaad: do you think price is setting the narrative? >> different people are different to narratives. for many, what is setting the narrative is frankly fear about what their country might become. this might all get cleaned up, always administrations have growing pains. i think we are going to know a lot more a week from now when we see whether the administration recognizes that this was chaotic, costly, and counterproductive or whether they decide to double down on this kind of thing and continue to make policy in this way.
8:56 pm
we will no more a week from now and that will either be calls causeassurance -- reassurance or cause for greater alarm. rashaad: former u.s. secretary of treasury larry summers speaking earlier on bloomberg daybreak america. trading on the downside, we have got the nikkei to 25 it down once again 1.2%. always -- k here is lunars due to the holiday. equities in this part of the world sliding. golden seeing gains. u.s. stocks dropping the most since the november election. concern as to
8:57 pm
america is leaning towards isolationism and this is overshadowing the progrowth agenda. we are looking at india's largest mobile carrier and invitations there.
8:58 pm
8:59 pm
rishaad: it is almost 10:00 a.m. in singapore, 1:00 p.m. in sydney. i'm coming to you from bloomberg's asia headquarters in hong kong. this is bloomberg markets. the asia-pacific on the retreat as u.s. stocks fell the most since the election. president trump and his controversial policies are the catalyst as he is under attack
9:00 pm
from silicon valley and wall street. afterding dollar charge warnings of losses to come. i will take you right across this part of the world from tokyo, sydney, to mumbai. first in our hong kong studios. sophie kamaruddin. down pointan stocks 05%. .he reason is set to follow japanese shares falling the most in the week. the nikkei is down over a percent. that is after the bank of japan policy decision. we do have a focus here on fuji electric trading at its highest since may 2006. number has said in the past that they have become more sensitive with the weaker yen to boost. we also have a chemical company even23%, rising as it announced a profit drop.
9:01 pm
on the kospi, we are seeing energy shares drop. this is the gains and the banking stocks. adding 20%extile another up --by and i steel up 10%. we also do have energy dragging on the asx 200 along with materials. we do have a shed of seven points amid negotiations with copper mine workers in chilly. and there is anxiety about president trump's immigration dan. we are seeing that oil and national gas stocks good be the biggest loss this year according to the deputy director of the energy institute at the university of texas. a last check on oil prices. we are seeing crude whole losses after a two day drop. it is expected to see in
9:02 pm
beition to the overhang to kept in check with u.s. production rising. opec compliance is expected. the national resources chairman said that american oil output this year may rise near the 2015 peak. with that picture, oil prices are set for the first monthly decline since october. they're down over 2% in the month of january. rishaad: thank you for that. todayher big show in town is the bank of japan rising on day to, the policy meeting, the first of the new year. now kathleen is in tokyo for that. what are we anticipating? i'mor: -- reporter: standing in front of the bank of japan waiting for governor
9:03 pm
kuroda and his colleagues to wrap up their meetings. no policy change is expected. 42 economist surveyed agreed with that. the question is will the bank of japan upgraded its assessment of the japanese economy. let's run through some of the things we are sure about. bank of japan is expected to keep the key rate at -0.1%. barely negative. they expect to anchor the 10 year at 0%. watch whatever governor kuroda has to say on the press conference on exchange rates. americaident of bank of and the chief equity and currency strategist says the 120.r-yen will go past the bank of japan is expected to boost its economic assessment. positive economic signals right now looking for 1.3% gdp growth in 2017. one thing we are not expected to do is to raise their information
9:04 pm
-- there inflation forecast. step back from all this and the former bank of japan policy board member told us it is time for the two allies that if it cannot get the economy going with inflation rising, physical policy has to add to that effort as well. here's what she said. done enough.ready have to has tor increase the strategy. that is more important. reporter: when it comes to exchange rate, she said actually that it is a mistake for the bank of japan to draw on a week yen to boost the japanese economy. it needs to be demand driven, but the demand has to come from policy.
9:05 pm
the team has to get going on that now. rishaad: what about yield curve control? what is that actually do? governor kuroda has tried to do that but as had limited success as time has gone on. what are you expecting? themter: we are expecting not to make any changes. the woman we spoke it was critical of the policy because japan has to decide, either we buy ¥80 trillion of bonds, or are buy whatever number we need to to keep it key rate at zero. when they first launched yield curve control, it did not do much to affect bond yield. it was only when donald trump grabbed the white house that it had more impact. there is so much uncertainty now in the u.s. economy and in fact
9:06 pm
in the white house, particularly in japan, it is not a good time to make any changes there. we are also going to be waiting to see if governor kuroda has anything to say about donald trump and his impact on the japanese outlook. said that he thinks this is a big risk right now. minister on they and donald trump sat down to talk about trade, there may be some pressure on the prime minister to not let the yen devalue and to boost japanese exports. but the prime minister will not be able to agree to that because it will look like he was giving up japanese control and japanese sovereignty. so no move is expected there. they could be a real impact. donald trump has created not just uncertainty, but maybe challenges for japan and its economy. these are the kind of things that are supposed to keep japan tightly on hold.
9:07 pm
thank you for that. you up to speed now with some of the first word news headlines. deutsche bank will pay 400 $25 million in new york to civil allegations that have helped wealthy russians launder billions of dollars. the investigation relates to mirror trades handled by deutsche bank's moscow office between 2012 and 2014. sources say the bank is closed to settlements on the same charges in the u.k. it will be in the hundreds of millions of pounds. india's largest mobile carrier is in talks to join with idea carrier. the company would have people rights with vodafone in the new company.
9:08 pm
surgery -- stock has surged in mumbai and was also up in new york. reports from india says the government expects higher oil prices to drag on growth this year. sources in the finance ministry see oil climbing 15%. other growth risks include roble trade -- global pay tensions. present ary will survey on tuesday with the budget due wednesday. president trump's take for secretary of state has cleared a procedural hurdle. 86-43 two-puttd rex tillerson on track for nomination later this week. the nomination is expected to go through, though critics highlight his links to vladimir putin and russia during his time as exxon ceo. global news. 24 hours a day. powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg.
9:09 pm
david: -- rishaad: indeed, it is been all about president trump in the last ud -- few days. attack from wall street, silicon valley, and leaders all over the world. start?oes one ramy: there's a lot of stuff happening. a lot of stuff from all sides. i was just watching elizabeth warren on the floor of the u.s. senate lambasting donald trump's executive order of banning immigrants from overseas. that is the latest in what is been happening in the past two and one half days or so. i also want to tell you about from washington state, it is the first date to actually sue the president. they are suing donald trump over his executive order. that is the attorney general
9:10 pm
suing the blackout order. theaid that no one is above law, not even the president. they are one of 16 states who have condemned the executive order. we have to head back to washington, d.c., because the acting attorney general has come out to say that she will direct to nother employees defend the trump executive order because she believes it could be illegal according to her purview. she is the highest ranking holder from the obama administration. this is very symbolic because linking ahead -- looking ahead are expecting the pic of jeff sessions to take over. once he is concerned, the obama attorney general holder over is out of the job. as long as she is active attorney general, she is going to not present arguments in defense of that executive order. aside from that, the business
9:11 pm
reaction and wall street is finally weighing in on that executive order. we have the top head from jpmorgan from gordon sacks as well as from black rock coming in. ceo weighed in and was quite blunt on this. he said this is not a policy we support. being diverse is not optional. goldman sachs really takes a stand against a sitting government. it usually does send employees into governance as we see gary cohn the former number two for lloyd blankfein. jamie dimon as, cross as a bit of a softer approach. he is weighing sacrifices made to keep our country safe. he is weighing national security against the diversity that immigrants bring to the table. was, black rock's ceo weighing in.
9:12 pm
he was talking about how they need to combat terrorism and promote security, but there needs to be respective due process. a lot of people weighing in from politics to the business executive area, as well is to be tapped sector. you can see those names coming up over the past 48 hours like apple, google, and microsoft saying they do not agree wholeheartedly with this immigrant band. -- ban. rishaad: i think mr. trump wants to look at the dodd frank act. what is the latest their? ramy: ramy: he came out earlier today and was blaming the 2010 dodd-frank act for holding back on loans that prevented the growth of those small businesses. let's listen to that. trump: it is almost impossible to start a small
9:13 pm
business. it is impossible to expand your existing business because of regulations. and because the banks do not loan you money. dodd-frank was a disaster. we are doing a big number on dodd-frank. ramy: word about the repeal might actually help the financials, but interesting late -- interestingly, all bank stock fell. this is a not in effect from what is been happening in the markets because of the uncertainty in terms of president trump's policies moving ahead, as well as with the possible shipping a way of dodd-frank. we are not sure of the timeline. this is the first day he is talking about it. you can bet that democrats are trying to make sure that dodd-frank does stay alive. rishaad: thank you. we are expecting donald trump to announce his nominee for the supreme court tuesday evening in the u.s.
9:14 pm
it should be wednesday morning in hong kong. you can watch that live on bloomberg. , paying the price. mitsubishi aircraft and why japan is no closer to taking off. ♪
9:15 pm
9:16 pm
quick check of the business headlines. recorded a $6 billion loss and does nothing about it. fears about the company have been realized. he criticized toshibas september reports about improving its internal controls. the company is expected to finalize those losses when it reports on the 14th of february.
9:17 pm
we have heard suggestions that toshiba is debating whether to reduce those statements. from thet westinghouse current 87%. it wouldlear how easy be to find a buyer. selling part of its westinghouse state is an obvious action, though a difficult one. toshiba may cut the new state. it is considering dublin for european headquarters. they have to establish a company in the eu to maintain the block after brexit. daiwa has forged 50 employees in europe, mostly in london. it is something we have been that ang of late
9:18 pm
regional jet that mitsubishi has been trying to get delivered. it has been a troubled program. it is been delayed. it's development costs are rising. our next guest is responsible for global sales and marketing. he is vice president of mitsubishi aircraft corporation. thank you for being here. what has gone wrong this time? >> thank you very much. actually, we announced a scheduled change last monday. the reason is we need some redesign of some systems to meet the latest regulations. detail, the location of some components and wire be changed to to meet the latest regulations for flight certificates.
9:19 pm
these will avoid explosions or huge water leakage. the blame is flying at the moment trouble-free. the question has got to be, this delay, are you confident that this plane will one?ave a sixth notes because this will affect functionality. program will continue because we are not going to update anything regarding performance. our proposition to the customer has not changed. rishaad: i think your biggest customers are trained states and skywest.
9:20 pm
aere is concern that this is bit too heavy for the u.s. market. are you confident that it will get the mission to fly india? or they get commission to fly this mi j aircraft? definitely. u.s., at the the beginning we anticipated this issue. why we developed between 70-90 airplanes was for flexibility depending on the situation. our customers have the option to select 90 or 70 depending on the option of scope. greatn choose with
9:21 pm
opportunity and flexibility if you are our customer. rishaad: how much did the delay cost you?, tested this costs the program? disclose that amount. committed to this long-term. we are one of their biggest japan so we made a long-term investment in this business. rishaad: great talking to you. getting to breaking news at that moment. donald trump firing the attorney general that refuse the immigration band. she told them not to defend the controversial immigration orders. that is something that is breaking at the moment your the white house has appointed
9:22 pm
sincer to take the reins sally yates has been fired. coming up, sony. the bombing taking its toll on the company's balance sheet. we will head over to turkey to find out why things are going wrong there. ♪
9:23 pm
9:24 pm
rishaad: let's have a look at the share prices. announcing here a billion dollar write-down for its movie business. sony has been having a difficult. in the film division. what is going wrong here? they have not been doing as well as they have hope ghostbusters"ke "
9:25 pm
birds."ry this does relate to the 1989 purchase of columbia pictures. it is looking to see how it is going to impact. third quarter results are due on the second of february. we can take a look more closely at sony's balance sheet then. the announcement comes two weeks they announced the ceo was going to be leaving after 13 years. the signs have been there for a while about the movie unit. sony did warn that it was possibly going to post lower projections. that was months ago. script read for sony and the movie business tech up
9:26 pm
-- business? they are moving to california temporarily to try to work things out and try to find a successor for the ceo who is leaving. sony will be selling another part of its business, a medical web service. they will play -- they will be sharing some shares of that to goldman sachs. increasetrying to profits from intellectual property for example. also, expanding globally. looking at aill be shift to home entertainment. they had not expected dvd and blu-ray movies do sell quite as badly as they have been doing. rishaad: coming up we are
9:27 pm
looking at india's risk factors. how rising oil prices could stop the country's economic growth. we will head over to mumbai for the details on that. ♪
9:28 pm
i've spent my life planting a size-six, non-slip shoe into that door. on this side, i want my customers to relax and enjoy themselves. but these days it's phones before forks. they want wifi out here. but behind that door, i need a private connection for my business. wifi pro from comcast business. public wifi for your customers. private wifi for your business. strong and secure. good for a door. and a network. comcast business. built for security. built for business.
9:29 pm
>> is the first word headlines. president trump has hit back at one of the prominent critics of his travel ban. he fired the acted attorney general. he said she did not defend she would -- the controversial order. goldman sachs boss said it is something they cannot support. the japanese prime minister is pushing back at white house witticism at auto sales. president trump claimed the trade imbalance between the u.s.
9:30 pm
and japan is unfair. thereime minister says are reasons for poor sales between the u.s. and japan. indeed, they are almost nonexistent. it would become a contentious issue if bilateral trade negotiations were ended. a quebec shooting killed six people and left two more in intensive compare -- intensive care. he was a 27 euros student. they still have no motive for one of canada's worst act tax. police are treating it as terrorism. justin trudeau described it as an act of senseless violence. sony fell the most in two months a billionuncing dollar ramp down in its movie business. sony warned in june that he could see more losses. to offset that, it is selling a stake in a medical weight service to goldman sachs for
9:31 pm
point of $50 million. global news. 24 hours a day. powered by more than 2600 journalists and analysts in more than 120 countries. i am rosalind chin. this is bloomberg. rishaad: this is bloomberg markets asia. that's have a look what is going on market wise now. most markets are still on holiday, at least until tomorrow. i want to check in with what is going on with the yen given we are waiting for the bank of japan's decision. we did see a move. dollar-yen extending its decline to a session low. this is after president trump fired the active attorney general who defied the immigration and. see yen this, we did bounds to raise.
9:32 pm
polled byists bloomberg anticipate a change in boj policy. we do have asian stocks falling lower with consumer discretionary pleading the drop their almost 1%. are sliding into that kia. from toyota to we do have mazda motors contributing to the decline, even though it softens its earlier drop coming on the back of a nikkei newspaper report that it will meet the profit guidance due to a domestic recall. supposed to report earnings on february 2. we also had kia motors reaching its lower -- lowest level since september 2010. recovery earnings looking less likely in the first
9:33 pm
half of this year. i want to and on what is , the computer nec and telco maker, pledging the most in six years after slashing its profit outlook by 70%. downgraded the stock on the back of that upgrade. -- update. rishaad: the government in india is seeing its ban on denomination bills as a risk to growth this year. the administration of finance is expecting a drag on gdp. they're expected to present a survey to parliament later on. a reporter has information on this in mumbai. take us through the challenges facing the country. it is going to be presented later today. it is an annual statement on how
9:34 pm
the economy has performed over the past year. it might not have much in store about budget. most economists thinks it will be from 6% to 5.7%. what thisyet clear has meant for the economy. perhaps, some facts on that is also expected. we are headed towards this budget, what do we expect there? reporter: a bunch of things. we are expecting the government to make a clear statement of how it is going to navigate from here on. the impact of demonetization has been seen as a self goal by the administration. any measure to push of the demand that cannot be the negative impact could be seen. secondly, a want to see jobs. the compromise that this
9:35 pm
government did when he came to power. what are measures that the government is going to be taking to create new jobs in the economy. how can they reduce the cost and the private sector to create good quality jobs. investments in india have been pretty low. any announcement on enhancing capital expenditure by the thernment or encouraging private sector to start spending would be in the cards too. lastly, corporate taxation rate might be lowered. if that happens, what will be seen is a huge boost to corporate india and the financial market will welcome it. rishaad: thank you so much. that is a reporter in mumbai. let's look at the world's biggest copper mine. workers there are almost sure to go on strike.
9:36 pm
they have reached an impasse. let's talk to paul allen in sydney. what is at the heart of this dispute? paul: well, it is all about money. in january union demands for a 7% pay rise any $30,000 bonus. they offered a $12,000 bonus. this is really at the heart of the issue of workers from the number one union. they have been voting today. the agreement which is three years old also expires today. after early voting, it looks like 99% of the workers are going to vote for a strike. we should know within the next 24 hours. if that does happen and they do strike, 48 hours can elapse before the parties can agree to a five-day extension. it is all about money. australia'st about
9:37 pm
other minors. production numbers are doing pretty well. things are upbeat and on the upside? : the real right spot on the asx today is up 2.4%. second-quarter production numbers were very good. now they need 42.2 million tons, reaffirming the 2017 guidance. a couple other headlines in fortescue. the production costs are expected to come down to $12-team -- $12-$13 per metric on. as really as big electricity second-quarter oil and gas output are up. this -- this is when
9:38 pm
the trains increased land are coming online. -- trains in queens land are coming online. shares are up because goldman are expecting even better from origin on the quarter. origin shares still up 17% here today. rishaad: thank you. up next, donald trump's immigration plans sparking a global reaction. we will have the thoughts of a former nato ambassador. this is bloomberg. ♪
9:39 pm
9:40 pm
rishaad: quick check of the business flash headlines. the maker of the epi and is facing and antitrust investigation. they spark fierce arguments last
9:41 pm
year over the skyrocketing price. small changes to the epi pen shielded from an investigation. they say they've done nothing wrong. view.s lifted its iny say gm has made progress strengthening its position by building up the product profile while investing in costs. this is the first improvement since september 2014. the giant drugstore merger between walgreens and write a is a little smaller after roadblocks from antitrust regulators. they're cut the deal by almost $2 billion. they might have to divest more stores to gain approval. walgreens is offering up to
9:42 pm
seven dollars a share, up from nine dollars it was up to in 2015. condemned president trump's immigration crackdown. a former ambassador to nato and greece joins us to discuss the backlash coming from europe. concern is a lot of about what is happening in the united face because a lot of foreign governments know that we have taken in nearly 800,000 refugees since 9/11 with very few problems. we already have very strong betting in price. it takes 24-36 months to be admitted because they are thoroughly scrutinized. there is also concern that we do not want to get to be islamic islamicother radical characters groups -- terrorist groups another recruiting advantage. because theisome
9:43 pm
islamic state wants to convince its followers that the united states is against muslims. i contrast this with george w. bush after 9/11. he came out and said we are not at war with islam. he visited a mosque. he extolled the virtues of the islamic faith. we have not seen that kind of sophisticated approach from president trump and his advisers. it has been a ragged start to this. reporter: talk about the fine line like angela merkel has to take. she needs the u.s. in nido. in nato. i'm the other hand, there are fundamental policies for there will be this agreement. i will that affect the country. >> there is a fear across europe that the trump administration start, is not- leading in the way that republican and democratic administrations have led in the past. they are worried about the united states closing its borders.
9:44 pm
saying no to trade agreements. putting up a wall between mexico. stopping immigration. they are worried that the united states, the city on the hill, the city that has led the western alliance, it looks like a closed and fearful america. you hear that from europeans. they are also worried that the trump administration might swing it support to some of the right wing populist movements that are contesting the elections in the netherlands, france him and germany this year. transatlantic relations are at a very brittle state right now. it really needs -- the europeans want to see a self-confident and open american president. they do not think they have seen that yet. reporter: you start at the senior diplomat under george w. bush. i just in rex tillerson shoes. is being voted on soon. how much more difficult is his job today?
9:45 pm
>> when he is confirmed, and i hope that happens this week, he has the weight of the world on his shoulders. the rest of the world should be our allies, they are looking for reassurance that the united states is going to be with them. that we are not just going to break all the eggs and change all the policies of the u.s. government just because the policy that's just because the instruction is new. ton president trump talk president putin over the weekend, it appears that president trump did not raise russian interference in our election and did not raise russians in the asia -- invasion of ukraine. those are the two most issues of the united states. mostrane issues are the prescient for the europeans. those issues were not on the agenda of what was discussed. white house is not indicated that they were talked about.
9:46 pm
the europeans want the united states to have their back. right now, putin's division of europe is a very big concern of germany and the other east and west european countries. rishaad: the former undersecretary of state and ambassador to nato was talking on daybreak americas. getting back to the markets and looking at donald trump's impact at the moment of firing the attorney general. jump in goldw a close into the 1200 level as well as the dollar-yen declining after trump's actions. we had the nikkei going into the close lower by 1.3%. the kospi declining .04%. take a look at the movers. we do have some news around samsung. asia business daily reporting the company is considering building a mobile phone factory
9:47 pm
or whole appliance factory because it does not have either in the united states. it does have a semi-productive -- semiconductor production line in texas. we are seeing samsung electronics fall for the first day in four on that news. difference when you see the , sk hymix uper today. marketingy is a services player jumping its fourth-quarter earnings beats x to miss -- beats estimates significantly. we do have securities that raising the stock to buy from hold with a price target of 21,001 from 18,000 want.
9:48 pm
the stock rising above 9% on the back of that news. rishaad: thank you very much. let's get you to this deal that would create india's largest mobile phone carrier. we will get over to mumbai right after this. ♪
9:49 pm
rishaad: let's have a quick
9:50 pm
check of the business flash headlines. deutsche bank was going to be paying foreign to $25 million in new york. they're doing so because of allegations that they did help wealthy russians launder billions of dollars in cash. mirror trades.to these took place between 2012-2014. a couple of years duration of that. they are saying the bank is close to a settlement on the same charges in britain. that could also be in the hundreds of millions of pounds there. take a look at one company having a rough time of it. a5% down because of possibility of a strike at a copper mine in chilly. chile. the vote is continuing as we speak. it by a rejecting
9:51 pm
margin of 99 to 1. it includes no pay raise and an reduction in benefits. a wanted a pay raise and a bonus and $30,000. good asnergy is looking the oil and gas company is up in the last quarter. is at 400 and 11 -- foreign to 11 u.s. dollars. from pricesenefited in northeast asia surging because of output disruptions and also rising demand. vodafone may be looking to become india's largest mobile phone character -- carrier. it would happen with the merger through idea cellular.
9:52 pm
a reporter is in mumbai. what would a merger look like? at 387r: we are looking million subscribers and 36% market share and $10 billion of debt. it would be india's largest carrier overtaking the company currently in number one. they have a market share of 23%. --are looking at a character a carrier that would exceed that and be in a dominant position. carrierswhy are looking to consolidate? is it down to be sheer number of them and the cutthroat competition that they have to do to get business? reporter: yes, india is the world's second largest mobile loan market. at the same time, we have 11 carriers and we have seen the
9:53 pm
that wasrrier, in launched by the rickets -- richest man. carriers have responded to that because that is affecting bottom line. rishaad: what is idea saying about this deal? they are the smaller player here. -- this is being touted as a merger of equals, so what gives? idea has said they are in potential talks and it would be a merger where they both had equal stake in the venture. we will have to see how that plays out because given that idea is a smaller carrier, it would be interesting to see what goes on there. rishaad: thank you very much. that is looking at idea and
9:54 pm
vodafone's plan to merge. let's look at the markets. we had the biggest fall on wall street since the november election in the u.s. the nikkei to 25 1.3% on the downside. awaiting what happens next when it comes to the bank of japan. we are expecting them to come out in the next couple of hours and tell us what they're going to be doing. when itnge is expected comes to monetary policy excel -- itself. they will see how successful they will be at making their yield curve a bit more vertical. frustrating day of the week there as kospi is up 0.46%. let's look at the japanese market in a bit more detail. topicsdo have is the world bit. at 211 on the way down.
9:55 pm
the ve ratio just right at the 24 forward earnings. australia is down. quick look at what is going on there. asx 200 down because of a bit of weakness. bhp which we be -- have been discussing. petroleum is dragging that index down. but study you what we have coming up on bloomberg markets. david, what are you watching? david: we are going to be watching the boj. that decision to come at any point now. we have been following that because of speculation they might have something special up
9:56 pm
their sleeve. we are live right outside of the boj for that decision. we are looking at india as well. the finance ministry is scheduled to deliver its latest economic survey to parliament. we will look at what that might look like and how it affects make or break budget. there's a huge allotment that the military was asking for or expecting and we will see if it actually comes. donald trump firing the acting attorney general. we has seen an immediate spike after that in gold and japanese currency. a lot to talk about next. this is bloomberg. ♪
9:57 pm
9:58 pm
9:59 pm
10:00 pm
announcer: from our studios in new york city, this is "charlie rose." charlie: bill gates and warren buffett are here. gates is the cochair of the bill and melinda gates foundation. their philanthropy focuses on education, poverty, and global health. warren buffett is chairman and ceo of berkshire hathaway. the company is one of the most successful companies of the last five decades. the two have famously been friends for more than 25 years. together, they started the giving pledge in 2010. the initiative encourages the world's richest to donate the majority of their wealth to philanthropic causes. buffett pledged the bulk of his wealth to the gates foundation in 2006 and has since given more than $24 billion to charities. i am pleas t

18 Views

info Stream Only

Uploaded by TV Archive on