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tv   First Up With Angie Lau  Bloomberg  April 17, 2016 7:00pm-9:01pm EDT

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♪ tumbles after talks fail to reach agreement. high assurges to a investors seek safety. chiefs see finance stormy waters ahead. on thers voting impeachment of the brazilian president. .elcome to "first up" i am angie lau.
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the much touted meeting ended without agreement. crude tumbling. this is the view now. $38.18 per barrel, and brent crude at $40 a barrel. for more thanon 10 hours longer than planned, but broke up without a deal. what does monday hold? >> a big drop. to $30. go back based on people familiar with the talks, which ended a few point they at one said it seemed as if all the oil ministers were gathered around a computer trying to agree on the text of the draft. how much of a gap
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between what a lot of these members wanted to come out of the deal. it was supposed to end early afternoon. there was a press conference scheduled. it dragged on much later than that. a lot of people are pointing to the saudi's as the main stumbling block. saudisrstand that the insisted that the draft agreement include text which pointed out that iran must be included in any future commitment, and we all know that even before the meeting started that iran called it ridiculous. in fact, listen into the russian energy minister. i think it is clear to them who is to blame. think we have not reached
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those expectations we had when we prepared this meeting. how could a country that did not participate in the meeting be the reason for not reaching agreement? this is the position of the producer of saudi arabia. they think that all opec producers should participate in this deal. >> we understand that iran pulled out last minute after the onlycame out and said countries were members that were planning on signing the agreement should be attending. as a sign oft withdrawal of the invitation, so they pulled out. it didn't help that during the meetings some countries changed their minds, according to the russian energy minister. it all points to a deeper problem, that any deal at the moment is contingent on what some analysts call this fixation from the saudis on iran, a problem that runs deeper. angie: is it a fixation or
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convenient excuse? could be a convenient excuse. they knew iran was not going to attend. from these heard saudi crown prince that they could jack up supply if they wanted to. at the moment, it seems that the saudis did not want the deal to happen to begin with, and this is where we are at the moment. very clear that they want to get back to pre-sanction levels, 4 million barrels a day, so that is very concerning there. what is next? speedwas supposed to of the rebalancing of the market by six months. now it might take until mid-2017. june 2 is when opec is scheduled to meet again, but the next freeze meeting, if you can call it that, might take place in
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russia on october 20, although the russians declined to comment when asked about that date and place. -- he moment, we are seeing angie: what is the date again? maybe october 20 in russia. angie: well, the failed talks have sent crude futures plunging while the yen is rising. what are we saying? >> good morning. we aren't seeing this flight to save haven. another week of talking about the japanese yen once again. in the trade, it hit a 17 month high, at levels we have not seen since october 2014, so seeing the yen strengthened against the dollar. it is up 11% so far against the dollar this year, and we are continuing to see these movements coming through.
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foreign exchange seeking safe havens after these talks collapsed. that sent the japanese yen higher against the dollar. if we have a look at what happen with other currencies, this is the interesting part, because we saw commodity currencies start to come under pressure, z considers white line here. this is the japanese yen, that strong spike it had when the talks collapsed. it is still continuing to strengthen in early trade today. the aussie dollar, look at that, purpleue line, and the line is the canadian currency, which fell 1% against the dollar. the aussie dollar falling quite significantly, and it is a little weaker in the early session at the moment and the canadian dollar also coming under significant pressure so another weekend it seems once again that we will be continuing to talk about the japanese yen. let's get a read on how it is trading this morning. we were seeing it up for tense
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of 1% against the dollar, and as i said these october 2014 highs, yes, he we are seeing that japanese yen up by .4 of 1% against the dollar am a so that save haven play back into play in terms of currency movements and the commodity-based currencies. they really coming under significant pressure. angie: thank you for that. that's playing out across markets in the asia-pacific. new zealand, commodity currencies following -- falling. the new zealand dollar climbing $.69 to the u.s. dollar, also new zealand pre-much flat right now. look right there, this is the aussie dollar that we were talking about. futures in sydney pointing to slightly lower open, and over to japan, checking futures trading in chicago, dropping about 400
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points. that is what nikkei futures are predicting right now from friday's close. the japanese yen, safety play. it is a public holiday in vietnam, so no trading in hanoi. let's check other headlines for you this morning. the campaign to unseat the brazilian president is going stormy the wire amidst scenes in parliament. lawmakers voting on impeachment, accusing her of bypassing congress to hide a budget deficit. thatresident made last-ditch appeal ahead of the vote. brazil is in its worst recession in decades and has seen a wave of corruption scandals. malaysians outgoing central bank governor is confident the nation will meet its growth target of 4.5% this year.
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inflation is under control because of lower fuel and commodity costs, but says the ringgit should strengthen. she has said the central bank warned the government in 2014 that the debt, written investment firm posted a threat to the -- pose a threat to the financial system. expanding in the united states as it looks to grab a bigger , rivals are scaling down off rations. sumitomo mitsui has hired a barclays veteran to lead the team and will hire up to 10 more senior bankers over the coming months. china's consultancy services will appeal a verdict in an
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infringement case. a jury found the software maker should pay $1 billion. said it did not derive any benefits derived in the documents downloaded. the world's finance chiefs ended their meeting on an up the note, yet cautioned that the current market call may only be temporary. we have the main takeaways. what did they say? >> the g-20 struck a positive note. risks andwledged the the rocky start to the year for the financial markets. this time around during the spring meetings, they said the risk to the global recovery had stabilized. remember, we are seeing global stocks rising since the start of the year, since february, that will also shanghai
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see volatility index is recovering. christine lagarde sang the talks were a bit of collective there be to move from the negative situation to a more positive approach, but as expected, there s about whatution lies ahead. >> there was not exactly the anxiety,l -- level of but there was an equal level of concern, a collective endeavor to identify the solution and the responses to the global economic situation. shanghai, they did in finance ministers and central bankers pledged to use all policy tools necessary, monetary, fiscal, and structural reforms, in order to stimulate growth. angie: what were some of the concerns? >> policymakers have to deal with a host of risks to the
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global economy, one of them the possible exited the u.k. from the european union. george osborne telling reporters that the risk of a british eggs it has definitely risen -- exi y has definitely risen up the agenda. we also had the reserve bank of washington,ng in talking about the global situation being a little bit mixed. take a listen. >> the model of growth precrisis did not seem to work. is industrial countries are still trying to take off, emerging markets trying to figure out how they work without industrial countries going strongly, and of course, developing countries depend on the entire scheme working, so it is a difficult time. >> not surprising that
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policymakers are being cautious. last week, the imf cut its global outlook, warning that a long stretch of slow growth had made the global economy more susceptible and more probable to shocks. angie: thank you for that. coming up, we take the latest lamborghini for a spin in hong kong, and more on oil, which is plummeting on the failed talks in doha. what is next for crude? ♪
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>> welcome back. kong,7:15 a.m. in hong and these of the stories making headlines around the world. japan has sent 25,000 rescue of recent the area earthquakes. saturday, the 7.3 tremor was the
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most powerful to hit japan since the fukushima quake five years ago. several companies have suspended production at local plants, but nuclear reactors are said to be undamaged. 238 people were known to be killed and a powerful quake in ecuador. 1707.8 tremor struck kilometers northwest of the capital. it was one of the strongest in decades. officials say there is considerable damage, and the area was hit by dozens of oil shocks. the state oil company said there has been no damage to its refineries. of myanmarsident will release more political prisoners amid sweeping democratic changes under the new government. he heads the first freely moreed administration in than 60 years. opponents were commonly arrested and jailed. it is not clear how many political prisoners there are. powered by over 2400 journalists and 150 bureaus around the world, this is bloomberg news.
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angie: back to our top story, crude prices tumble after talks between opec producers and others failed to reach agreement. oilext guest sees a rise in prices by the fourth quarter, with economic pickup spurring demand. that by the end of the year, we will get there. the second half of the year being the case. we still have this oversupply. >> good morning. it seems to be the case, and certainly not getting anything concrete out of delhi is an issue. doha is an issue. economicsod strong
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the price of oil will have that shock and falloff. angie: a lot of people expect a five dollar drop her barrel. what is your forecast for today? aroundok at the range, the bottom end of the range. is $36.80, so a little bit more of a shock, but not too much follow-through. 6% has been quite a large fall. this is the way we have been playing it for some time. when he gets close to $35 per barrel, that's where we like it. fore: what does this mean shale producers and the u.s. and other projects sitting on the sideline? >> it is more of the same. just sit and wait. there is not much you can do when you have so many players. some are producing at record levels tear, so there is an issue. guysyou see the oil shale
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and exactly what they are doing, remember they are trying to be more of a low-cost producer. takes, the leaner they become, some more of a responsive process when prices go higher. when we thought that they were producing very expensively, as time passes, that will be cheaper and increase the flow. it is important for us to see the economics pickup. angie: what should smart investors do today? , or dosell on the dip anticipate as you do that fourth-quarter pickup and then buy into the dip? look, it's like usual when you see a run-up to a large event, you see a lot of panic, and i think that is what we are seeing. to my mind, it is sit back and
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see how the dust settles. we might continue to see the selloff, let's wait and get some clarity. we still have arranged to contend with, and not until week take out of that range do is start to make other decisions. downside, and $42.50 is the top side. it's only when we break that range do we need to come up with other trading ideas. angie: what is a highlight for you after first quarter gpd figures out of china at 6.7%. i have enjoyed watching the data come out of china, because it has been encouraging. when i look at the encouraging nature of that data, i see that iron ore is leading the way. we have had a lot of volatility in the market, but it has been an interesting time because were seeing record amounts of production, and the same and
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consumption, so it goes to show that when you do have an oversupplied market, when you start to get the gravity of economics in your favor, prices will gravitate to the top side, and that is the model we are following. when i look at the iron ore market, i see that sector is one that is still well priced, and we have been moving into that sector for the last quarter, so iron ore in my mind remains a good opportunity. much of that first quarter number was propped up by property prices, and of course that has been a boon for commodities. angie: how sustainable is it? one housings, prices, to reducing capacity with the chinese economy, cleaner alternatives in terms of their production, so when you start to look at it, the fact that we're seeing this, more stimulus, i think you will see
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that growth, so i think it is sustainable. we don't want to see rapid growth, but we want to see steady growth, and i think that is what they will be getting. angie: very good talking to you this monday morning in asia. coming up next, australia faces overrly election controversial legislation. "first up" back in two. ♪
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angie: tuesday should draw a ase under the power struggle the parent company of 7-eleven in japan holds a board meeting to promote a president. his rise is seen as a vindication of activist investor daniel loeb. of latest trade dana at
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japan will give us an indication of the economy's condition. weighed onyen wa exports. we will get a glimpse of how the commodity sector is faring on bhp billitonn gige killingto reports. on friday, the latest check on we will see if china's crack down on excess is deterring gamblers. with has been struggling 22 months of slumping revenue as casinos turn to the mass market. senators have returned to duty they couldwo bills give the government a trigger for an early election. pass either will
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result in both houses being dissolved and elections in early july. how likely is this early election scenario? this will be an interesting exercise in self-preservation, because it is up to the senate to pass this bill. if it does not get passed, the government has a trigger for dissolving both houses of parliament. election, only half would be elected. the failure of these bills lies in the hands of 6-8 senators from small parties or independencts. an election is held, it is likely they would be wiped out in a double to solution. whether or not these bills gets that smalls on handful of people whose futures are at stake. those futures, but a lot of smiling faces, still an early
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election becoming an increasingly risky strategy for the government, isn't it? senators, while at risk, it is the government as well. the coalition enjoyed in a norma's bump in the polls, but the last two polls have fallen behind. thee look at the primary, coalition still has a healthy lead, 41% to 36 percent, but nehring over the labour party. labor has nudged out into the in terms of 49% which party is preferred. the preferred prime minister, malcolm turnbull stillwell out in front, 47% to 28% for the opposition. his lead has half, and he came to the job promising reform, but has proven to be reform adverse. angie: thank you.
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paul allen for us in sydney. ating up, china hits out major credit rating agencies and major credit rating agencies and accuse them of thank you. ordering chinese food is a very predictable experience. i order b14. i get b14. no surprises. buying business internet, on the other hand, can be a roller coaster white knuckle thrill ride. you're promised one speed. but do you consistently get it? you do with comcast business. it's reliable. just like kung pao fish. thank you, ping. reliably fast internet starts at $59.95 a month. comcast business. built for business.
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angie: we are that the end very closely. we're 30 minutes away from the opening as well as in south korea and australia. top stories this hour. oil is tumbling after talk about an output freeze. they met crucially without iran. they would not accept a deal unless all opec members joined.
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a freeze not agree to until they have significantly lifted their output level. the talk straight on 10 hours longer than planned. brazilian lawmakers are voting on the impeachment of the president. she's accused of misleading congress to hide a budget deficit. the president made a last-ditch appeal for support. two thirds of the lower house must support impeachment for it to proceed. brazil is in its worst recession in decades. the world's finance chiefs have finished talks at the meeting in washington on an upbeat note. to 2016.tart concerns have eased since the g-20 meeting in shanghai.
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the failed talks in delhi have sent crude futures plunging. juliet is watching the latest for us. what are we expecting to see the opening? juliet: not looking like a very positive start. we can see that the s&p 500 is pointing to a loss of about one half of 1%. we are seeing those weaknesses come through in this region. at least according to the futures the nikkei all suggesting top gains of about 1%. opens now in japan the fall could be quite a bit more significant than that. we still have a half an hour before trading begins. a pretty flat movement in
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australia. that did close about an hour and a half ago. we also said base metals off in london. very likely to affect the resource heavy australian markets. could all come under significant pressure. the oil price in correlation to what we are seeing in terms of around leak on the gold front. this yellow line is the gold futures price. it is rising. with that safe haven japanese y en.
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this line is the debbie ti crude futures. brent crude also falling. we are seeing significant downward pressure on those crude contracts which is expected to play into markets in this region. the yen is also stronger. we would expect automakers and electronics companies in japan to come under pressure. that are a lot of reports they are going to adjust their production following the earthquake last week. all of these futures pointing to a selloff in the region. angie: those oil talks dragged on hours longer than planned it still produced no common ground.
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why no deal? alex: it was the country that didn't turn up that killed any hope. clear that itit would rule out any restriction on its access until it is reached pre-sanctions levels. it called the notion of joining a freeze ridiculous. the country's oil minister had said he wasn't going to come to the talks, signing the deal of self-imposed sanctions. with the saudi's saying that any workwith iran would not effectively these talks were dead in the water. angie: what is next for the oil markets. alex: the demise of these talks
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probably won't do too much to the in two of the countries committed to an output freeze, russia and iraq, are already producing close to record levels. the market is overlooking a potential more significant event and that is this labor dispute in kuwait that has cut production by opec's fourth biggest producer by two thirds. for the moment the market is focused on the failure of these talks. they do send a pretty clear message to the market that each of these countries must fight for itself. the effort to address the collapse in prices has failed. for anyone hoping for a and supply of demand fundamentals, that is not good news.
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angie: a few months of preparation resulting in absolutely nothing. minister has sent more rescue workers to the site of the earthquake. 41 people were killed in japan in a series of tremors. japan's worst natural disasters since march 2011. what is the latest on plant closures? we've still got a lot of the companies from last week saying that they are going to close plants and they are still closed. has stopped output of motorcycles at its plant in kumamoto. output of stopped cars. just because they can't get the parts they need.
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toyota motor is going to have to idle output at 26 different plant lines. because of problems getting supplies that it needs. that is a big situation there for toyota. that could cost to toyota as much as 30 billion yen. aftershocks are continuing and may continue for up to a year. they are shallow but they could be disruptive. outputery hard to resume when the building shaking. angie: how big is that impact likely to be? brian: it is still pretty early to get a good sense of it. one economist said it looks like the economic impact could be more than $60 billion.
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some of it is to rebuild infrastructure that has been demolished. also for the businesses themselves. we've also seen the infrastructure has been hit. the airport remains closed. the bullet train has been shut down. the impact is going to get bigger as we go forward. angie: there have been a string of aftershocks. brian: the rescue efforts are continuing. the prime minister has sent both0 people to work on looking for people who need help as well as distributing food and water and helping with temporary shelters. the focus was on cleaning things up. i would expect the prime
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minister to announce some some support in terms of financial aid. he wants to do that sooner rather than later. ahead of the g-7 summit that will be held in japan. angie: the plan to create britain's biggest telecom operator may be vetoed by the eu. the bid may be blocked within weeks. regulators are said to be unconvinced that it will create enough competition. they want the companies to sell part of their network infrastructure to a new rival. the sunday telegraph says hutchinson will challenge any regulation in court. they are preparing for change at the top. the ceo stuart gulliver plans to quit in two years. they are compiling a list of candidates to replace him. the bank will first appoint a
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new chairman to help take the next chief executive. the liver over in 2011. cut nearly 90,000 jobs. the stock has fallen to 60% this year. the second-biggest online moneyer is going to raise in a bond sale. the company declined to comment. japan's internet giants are providing a haven for odd investors fleeing from state owned enterprises. the ceo of china's website autozone has come to bid on insurance to buy 48% of the company. they submitted a preliminary at $31 andagreement $.50 a share in cash. the stake is held by an australian company.
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shares in new york rose by more than 6% on friday. china has accused international ratings agencies of bias after s&p and moody's lowered their sovereign outlook. the finance ministers spoke at a press briefing in washington after the weekend meeting of his g-20 counterparts. and central bankers. the downgrades happened last month. the china is reacting now. haidi: understand whether we choose this forum, the g-20, to air their grievances. you can see the downside risk the chinese growth. by creditssments rating agencies are not giving china enough credit for how well their market performance has been. historically. because of that there is obvious bias.
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the decision just downgrade the outlook for the sovereign debt in march but they are divorced from economic reality. they've had 7%at growth for years. growth still very high in line with the government's target. but of course keep in mind that growth target isn't exactly what the ratings agencies are worried about. they are worried about the debt. the rebalancing is going to take a long time. have debt to gdp rising to 250%. a very steady trajectory upwards for that. the slowdown in gdp is causing this. if you will have that quarter on quarter growth. a 1.1% since 2011. that paints the picture. the debt level is more worrisome and that is what the ratings agencies are really concerned about. this is a recovery it has been
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fueled by debt. particularly from the property sector which contributed about 10% into that overall gdp number. and the concern is that deleveraging increases it will be a curb on growth. debt capacity may be running in about four years. see bigwhen we will problems really arise for china. those prices reflect two faces of china's economy. when we return.
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the leading candidate for the philippine presidential election says he regrets what he called his gutter language about joking about a woman who was raped and murdered. video showed him telling supporters that he was laughing
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about the incident. opponents say he is not fit to hold office. china's second highest-ranking military commander has entered the dispute over the islands in the south china sea. the general said a group of military and civilian officials were said to inspect construction projects. the philippines and taiwan and vietnam also claim part of the chain of islands. it wouldd states said launch joint patrols of the area. a british airways flight has landed safely at heathrow after being struck by what is thought to be a drone. they reported an object hitting the front of the airplane. it is thought to be the first time that a drone has come -- collided with a airliner in the united kingdom. the association called drones are real and growing threat.
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this is bloomberg news. angie: key data coming out this week. china is issuing data about prices. we certainly saw support for first-quarter gdp figures out of is a, the thing is this credit fueled kind of growth. property prices are recovering. is it sustainable? seee definitely expect to these prices continue to increase in aggregate. some of the stimulus measures that have been put into action are starting to yield some results. you have to always look deeper. chinese property market is in the direction of the economy. cities, where two growth is led primarily by the service sector and information
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technology. now they are experiencing double-digit increases in prices. places like beijing and shanghai. they will continue to increase. speculative bubbles. on the other hand, areas where more traditional engines of growth such as manufacturing have been experiencing declines and that will continue to happen looking forward. whether it is sustainable or not. the pickup in growth in the first quarter was led by credit. corporate debt is already very high. angie: s&p and moody's and all the rest are worried about china and the credit boom there. carlos: it will provide a boost to the economy in the short term. it aggravates the national tendencies in the long term. in the absence of structural reforms particularly about the
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sme sector. state owned enterprises. angie: also coming up this week are some great decisions from -- a rate decisions from south korea and indonesia. expect from those donations? korea has experienced slumping growth in exports. also a weak domestic demand. significantt lost a vote in the national assembly last week. i would've thought that they would most likely be cautious with their decisions this week. i don't think they need to be in a hurry now. angie: any reprieve for
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indonesia and the other central banks in that region? indonesia is also experiencing falling exports. they do not benefit from week oil prices. some pressures to ease the government policy they are to make a progrowth. moving the seven day repurchase away from interest rates. it is lowered it 75 basis points. angie: they need to fine it a bit. japan trade data is coming out this week. carlos: the japanese yen is strong against the u.s. dollar. i would expect that to come through in the forward exports. what we have been observing from was the year in asia is that exports fall by less than imports and they will continue to increase.
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not necessarily good news. angie: thank you. there has been a tumble in oil prices. more news after this very short break.
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thee: newest version of lamborghini supercar has landed a hong kong. more than 600 horsepower. from a standstill to 600 kilometers per hour in fractions of a second. all right. this is so scary.
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this one here is the lamborghini. there are three modes in the car. street, sport, and race. it is much quicker than you need. zero to 100 in 3.4 seconds. it depends on what kind of mood you are in. you what yougive need. the store -- car is catered toward the fun to drive market. this is the first one to officially land in hong kong. watch out.
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this is what you are paying for. the respective the road. i have to work really hard to get one of these now. angie: she was taking the new lamborghini for a spin. welcome to the stock exchange. taking a look at the opening in japan and south korea and australia. >> take a look at apple suppliers this morning. apple may cut their iphone production. more than 40% of their revenue comes from supplying to apple. it is falling by 5% yesterday.
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it may extend those losses today. david: i am playing the oil card. it is a fairly volatile stock. the stock is down 60% over three months. you have the energy index down below 10.2%. will haven oil prices an impact. likely to see some pressure. haidi: the company that runs jupiters casino in queensland. off anothernd casino owner. the state owned travel giants in a deal to get more tourists coming through from china on
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these rumors that he is intending to get into that market. he is always in talks with the chinese consortium. angie: thank you.
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♪ angie: no deal in doha, oil plunges after talks breakup without agreement. it all points to losses at the open in asia. the campaign to seek the , a votet of brazil right now. crude futures have plunged after talks stalled, what does this
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mean for our markets today? we have the latest. good morning. big plunge we the have seen in the crude futures in the early session. 5.5%, 38 dollars $.17, falling quite significantly. contracts also coming under pressure. down 5.1 percent in the early futures, but we are saying that flight to save havens, so there could be a few pockets of resistance today with that gold price higher. one thing that will weigh on the we have also seen the japanese yen continue to strengthen, up by 6/10 of 1%
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against the dollar. the investors are bailing out of commodity-based currencies. a look at the open, nikkei 225 down. one of the steel producers coming under significant pressure. the kospi down by six tens of 1%. -- 6/10 of 1%. angie: the talks broke up without a deal. david has been taking a look at this for us. just to frame this properly, the meeting ended just after midnight asia time. the was supposed to end early afternoon.
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out to thecame surprise of the oil ministers there by insisting that we either all do this together or do not at all. if we are to do this, iran should be in as well, which we all know was highly unlikely, although it was possible because iran was scheduled to attend, but pulled out last minute friday evening because the host came out and said that only countries who were actually planning to sign up to the deal would be welcome to attend. basically said, that there is no use in attending, pulled out, and the meeting was pushed back several hours because they could not agree on the text, and this is what we have. this into the energy minister of russia. fair amount with a
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of optimism that a deal was possible. a lot of these countries agreed in principle. listen in. we haven't reached those expectations we had. how could a country that did not participate in the meeting be the reason for not reaching the agreement? of the the position largest producer, saudi arabia. they think all opec member should participate in this deal. of course, the problem between the saudis and iranians runs much deeper, then we get into the political sphere and it becomes much more complicated. that is the reason you're seeing oil market sell off at the moment. this mean fores the supply glut at the moment? several analysts have pointed out that even if we did get an oil agreement, they are producing at record levels.
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saidussian energy minister a freeze would help rebalance the market and bring it forward by six months. at the moment, we don't have that. that will be pushed back to mid-2017. the signals in the market is that it will be unlikely for them to find an agreement. now.ave the selloff right possibly, an agreement, maybe not, june 2, the by annual meeting of opec, and maybe october 20 in russia, that is when according to someone with knowledge of the talks, we might get the next freeze or it might be back on the agenda. when asked to comment, the russians declined to comment on the date and time. angie: let's see how crude traits today.
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thanks. other stories we are tracking. the campaign to unseat the brazilian president is going down to the wire. lawmakers are voting on impeachment, accusing her of bypassing congress to hide a budget deficit. the president made a lunch ditch appeal for support before the vote. brazil is in its worst recession in decades and has seen a wave of corruption scandals. tata consultancy services we'll appeal a verdict. the jury found the indian payware makers should $1 billion for using software without permission. it said it did not receive any benefits from documents downloaded. expanding in the u.s., looking to gain a bigger share of cross-border mergers, sumitomo
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has hired a barclays veteran to lead the team and will hire up to 10 more senior bankers in coming months. world finance jason washington, but the market call may be only temporary. what did everybody have to say. g-20 were more optimistic than in shanghai in february, when they acknowledged the risks and the rocky start to the year. this time they say the risks have stabilized. rising, not to mention volatility indexes had ease. christine lagarde saying that the talks were a bit of a collective therapy to move from
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the negative situation to a more positive approach. was pretty cautious about what lies ahead. take a listen. there was not exactly the same level of anxiety, but i think there was an equal level of concern and a collective endeavor to identify the solution and the responses to the global economic situation. as in shanghai, policy makers pledge to use all tools available to them, monetary, fiscal, and structural reforms to stimulate growth. angie: what are some of the concerns? ker have a lot -- policy makers have a lot to deal with. they say the risk of the british from the european union has
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come up the international agenda and that the view is that it would cause immediate shock to the global economy as well as long-term costs. we also have the reserve bank of india talk about the global situation right now being mixed. basically macro economic leak, there were struggles for the global economy, but when it came ormicro-economy microeconomic approaches, there were still more options out there. it's not surprising to see policymakers more cautious, even though they are upbeat. just last week, the imf cut their global outlook, saying this long stretch of slow economic growth had made the global economy more vulnerable to negative shocks. angie: got it. thanks of that. -- thanks for that. up, oil slides, we check the view from emerging markets when "first up" continues.
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a 11 a.m. in hong kong. toan has sent rescue workers wear 41 people were killed in a series of earthquakes. 11 people missing, more than a thousand it sure did -- injured. to hitthe most powerful japan since the fukushima quake five years ago. nuclear reactors are said to be .ndamaged toyota shares are trading to the downside by over 5%. sony faring worse. the number of people killed in a powerful quake in ecuador has to 246. risen
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it was one of the strongest quakes in decades. officials say there is considerable damage. state oil company says there has been no damage to refineries in the region. the new president of myanmar will release more political prisoners under the new government. has the first freely elected administration and more than 50 years. opponents were commonly arrested and jailed. it is not clear how many political prisoners there are. hundreds were freed by the government as myanmar moved towards the markers see. powered by over 2400 journalists and 150 bureaus around the world, this is bloomberg news. back to our top story, oil facing renewed pressure after talks on a production freeze ended without agreement. 16 leading producers met in oha.i -- in d
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they said they would not accept the deal unless all opec members joined. on 10 hours, longer than expected. >> the meeting concluded that we further time for and from now until oprah to submitting countries will consult among themselves and with others. on howlet's check in crude and brent are trading right now. rent at $40 86 a barrel. barrel86 and the
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a lot of this was already priced in. two months of preparation ahead doha talks. everybody baked in agreement, and now we don't have one. i think it is interesting to look at the price action. all the selling happen right at the open. since then, we've seen a little bit of lying coming in. there are other things at play today. we are hearing news that the kuwaitis oil production workers have gone on strike. there have been other things boosting prices. it's clear that fiscal and monetary policy is working.
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we've seen some favorable inventory numbers along the way. it hasn't just been the lack of agreement, there are other factors at play. all the selling happen in the first few minutes. since in, buyers are stepping into the market. isn't it also a bet that in the second half that we will see as applied downgrade in prices pickup is a lot of people forecast, including the iea? >> yeah, i suppose. at the end of the day, the total opec production numbers have been flat for some time. the saudi numbers have been coming off in the last couple of months. a production freeze is never going to be that hot of a deal, so it is generally semantics at play, the fact that iran has not been at the meeting, they were never going to be involved, but that is kind of like a hindsight trade.
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think there is a june opec meeting on the second. if you did see prices spiral out of control, they could use that to undo a lot of what we have been seeing here. i think it is semantics that have been playing through. they are not cutting. angie: where is the smart money going? i want to reference your favorite bloomberg chart of the day as to what you are seeing. fact --ve looked at the one of the interesting phenomenon's is that when you see financial conditions, and the bloomberg use this with that in aggregation of credit spreads, money market spreads,
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implied volatility, the s&p seeing and what were from bond yields as well, and you can see that financial conditions have generally been improving over the last couple of months, and at the same time, the feds prefer breaking the measures of inflation expectations, five-year swaps have been going down in the last couple of weeks. expectationsght down, and i think that is really positive. as long as the expectations for june meeting stay anchored around 15% to 20%, but a financial conditions continue to push up, equity traders and credit traders will be looking at that is favorable and looking to buy dips until that implied volatility picks up prior to the june meeting rate hike, then risk assets is still quite favorable in the market. angie: that's a good point. what about fx volatility? oil is doing a number on the japanese yen.
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currenciesdity related to that are also getting hit pretty big. it's no surprise to see the hit hard today. i would shy away from being overexposed to the canadian dollar until we have gone through the european and u.s. so we can get a more realistic sense of oil price moves here. thele should be dips in aussie dollar against certain currencies. unless implied volatility really , if it wanted vix then ito 17% to 20%,
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would be looking more aggressively at shorting high-yield currencies. moment with it being low, quite and carry are still attractive, but if we saw that picking up towards 20%, the whole investment case it looks a bit reversed. angie: thank you. , oil talks failed to reach an agreement, all the details in your fx headlines after the short break. ♪
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faileds over the weekend in doha.
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opec andons between other producers ended without agreement. yen has risen 11% so far against the dollar, but little sympathy for japanese policymakers. jack lew told japan's finance minister in washington over the weekend that japan needs to focus on domestic demand and called fx "orderly." that is seen as a clear warning that the u.s. does not view eight yen intervention as warranted. let's have a look at the yen at the moment.
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atober 2014 highs, holding 107.94, very strong there, up three quarters of 1%. .he aussie dollar falling down 1%. iwi, cpi numbers coming fallen asnd that has well. we will show you that a bit later. angie: thanks. returnedsenators have to debate to bills that could give the government a trigger for an early election. failure to pass a little will result in both houses of parliament being dissolved. that's get over to paul allen in sydney for more. what is happening? paul: the governor general has
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just finished addressing parliament. the debate is underway in the lower house, the house of representatives. it has already descended into nitpicking and political point scoring, so it does not look good for these two bills. one is to reestablish the building industry watchdog, the other to regulate unions, and if i either failed to clear both houses, then the government has what it needs to call a double does a solution election -- double dissolution election. that's important, because ultimately the fate of these two bills rests on a handful of cross bench senators from micro parties. at the end of the day, this whole thing boils down to a bit of a cynical self-preservation really. early election is
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becoming an increasingly risky strategy for the government, isn't it? paul: yes, you would have considered the rolling coalition to have been an lock a few months ago. the tide has turned. the coalition still has a healthy lead in the primary 36% over the opposition labor party. when it comes down to two-party preferred choice, labor party in front. row witho polls in a the coalition trailing. it was poor poll results that malcolm turnbull gave as his reason for unseating tony abbott. malcolm turnbull still has a lead, 47% over 20% for the opposition leader, but it is important to note that malcolm turnbull's lead has have since he took over the top job.
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angie: interesting. to get theent has budget out of the way by may 3. what are we likely to see in terms of election sweeteners? very little, because there is not much left in the pot. the government has been running a deficit since it came to power, and the government for them since 2008, so we will most likely see modest spi modest spg cuts. is revenue measures something that moody's would like to see. they inferred last week that all aaa credit rating could be at risk, but right now with the possible collection on the horizon with july, it looks like the government doesn't have the stomach for any radical tax reform. angie: ok. paul allen watching that live out of sydney australia. may face, china
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stronger headwinds depending on the strength of the property market. we will look at that and more "first up" when returns. stay with us. ♪
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a.m. -- 8:30 a.m. in singapore. singapore continues to be buffeted by those global headwinds. checking in on the dollar, let's take a look. we will take a look at that a bit later. lower as oil
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plunges after talks broke up with no agreement. ,t has push the yen higher weighing in turn on japanese equities. we are seeing losses across the board in tokyo. brazilian lawmakers voting on the impeachment of the president, accused of bypassing congress to hide a budget deficit, something she denies. last-ditchnt made a latc appeal for support. the world's finance chiefs have finished talks at the imf spring meeting in washington on an up the note. concerns have ease since february g-20 meeting in shanghai. however, they remain cautious about brazil's crisis, brexit, and china's slowdown. powered by over 2400 journalists and 150 bureaus around the world, this is bloomberg news.
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asian stocks have retreated from a four-month high as crude prices tumble following the failed doha talks. how bad is the damage so far? >> good morning. we are seeing a lot of weakness come through in japan, the nikkei 225 down over 3%. oiljust a story of falling price, but that has sent investors into the safe haven yen, exporters coming under pressure, also another earthquake in japan over the bekend, estimates that could $66 billion worth of damage. companiesf export and energy companies coming under pressure as well. down as well. new zealand flat. the australian share market,
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to's go inside the asx 200 see the damage we are likely to see in terms of these oil and gas players. the sector is down by 2.6%. some stocks we have been following, all lower, none higher. all of these players coming under significant pressure. in terms of what we're seeing on the japanese yen, the strength playing into market sentiment as well. index offat regional from those four-month highs. ,he yen has come back a little 108.04. a big selloff of commodity-based currencies as well. lower bye dollar
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almost 1%, and the new zealand dollar as a, even though we had a beat on cpi in the first quarter, down by 4/10 of 1%. it is looking like a tough start to the trading week for regional equities. angie: thank you. internationalsed ratings of bias after the lowering of their outlook. have the full story here. i thought the downgrades happen last month. is a bit of a delayed reaction, but perhaps you can't claim them waiting for a form like the g-20 to express their grievances. it is also interesting because when the second downgrade came through, the reaction from china was that they did not care too much about it because it was not going to result in much market action. since then, the finance minister
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that china's sovereign debt has performed better than ratings credit re agency has given them. the cuts don't reflect economic realities. he points to first-quarter growth at 6.7% as expected. the domestic data has been better than expected so far this year, all in line with what they are expecting between 6.5 percent and 7%. it is a slowdown if you look at that topline number, double-digit growth back in 2010 first-quarter growth this low since 2011, so it is a significant slowdown from the gdp number, but what the ratings agencies have cited and the reason for cutting the downgrade is that that and how that impacts growth as well.
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social financing, the number came in on friday, one of the highest in recent years on the back of record lending at the beginning of the year, so this is a recovery driven by debt, tickly coming through from that property sector. particularly coming through from that property sector. a number of ratings agencies are concerned that it is a that -- it is a debt issue. the asian population will population aging will continue to increasingly become a head wind risk for chinese growth, but he also said that it is not entirely the rating agencies fall. they don't have the visuals of what the reforms look like,
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reforms in the pipelines to deal with downside risk, jet to ddp -- debt to equity swaps not finalize. he said that there are reforms underlying all of this, that even the likes of the imf, they don't see the rebalancing is underway. they only see the demand side recover, where is the finance minister saying underway. of course the markets would certainly want to see what these are before the credit ratings agencies would be convinced. thesenalysts said downgrades were more symbolic than anything, but they struck a somber tone in terms of concerns building over the debt and leverage and china's economy. actions speak louder than words.
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here's david. ,> let's start off in malaysia the outgoing central bank governor is confident the nation will meet its growth target. inflation is under control because of lower feeling commodity prices. however, she said the currency should strengthen. she also said the central bank when the government in 2014 that the debt ridden investment firm post a threat to the financial system. hsbc is said to be preparing for a change at the very top. the sunday times and says the ceo plans to quit in two years and the bank is compiling a list of candidates to replace him. a newill first appoint chairman to point the chief executive.
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the stock has fallen 16% so far this year. c.k. hutchinson's plan to create the biggest telco operator may be vetoed by the eu. the $14.5 billion bid may be blocked within weeks. thatators are unconvinced it will create enough competition. they want the company to sell part of their network infrastructure to a new rival. the sunday telegraph says there were challenged anyone in court. a chinese car website -- trumped they did a bid. the stake is currently held by
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australia. that was a look at some of the headlines. angie: china may face stronger headwinds if the booze from real estate proves unsustainable. property has been one of the key drivers from real estate bailey. on a quarter on quarter basis was below forecasts. what can we expect? that shinees some of we saw on that match on friday. led by property, the rebound in the property market. it's driving everything, steel, glass, so it got a good pop from
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all this stimulus. how long can that be sustained? alreadyggest cities are on the surge, sales as well, and the pboc is worried. whether this will linger is the question. angie: will it be reflected in today's property prices? ?> who can tell day by day, month by month, up, down, which way they had, i don't like to guess. economy and the feeding implications of all these industries, that is the long-term question that will go some way to determining the fate of china's economy. y is that the recovery we saw in the first quarter, maybe a stabilization, fueled by debt, massive fiscal year in, up 20% on the march, and the huge numbers of
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bank loans, two point $3 trillion and aggregate financing loans in the month of march -- $2.3 trillion in aggregate financing loans in the month of march. heading lower again if the stimulus runs out of juice. that's why all eyes are on what else we can see from the pboc to prop up this engine of growth. thank you for that. next, toy yoda is among companies forced to expand production halts after saturday's earthquake. live in tokyo, coming up next. you're watching "first up". ♪ . ♪
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angie: welcome back. you are watching "first up". japan has sent more rescue workers after a series of tremors and earthquakes.
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some companies have extended halts to operations. brian at more from fowler in tokyo. fowler in tokyo. they wille saying have to extend closures. toyota will shut 26 lines throughout the country as they are awaiting supplies. sony, it is unclear when it will be back on line. sony produces imaging devices used in the iphone. honda motor has shut down production of motorcycles, and nissan has topped production at a plant because of lack of supplies. the market reaction today was immediate and dramatic. cement jump to a 6% gain
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on expectations the country will rebuild. at the same time, insurance toyotaes hit hard, sony, , both down between 5% and 6%. the impact ong toyota could be ¥30 billion in terms of quarterly profits. be lossesthere will going forward. it is unclear when some of these aftershocks will stop. as long as the earth is shaking, it will be hard for these companies to return to production in that area. and no doubt these aftershocks could cause more damage. how big is this impact likely to be? first of all, i would point out that many of these aftershocks are occurring at a impact depth, making the
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and force that much greater, so these are serious quakes in themselves. i think we heard earlier in the show that some economists were estimating the damage at $56 billion, that is still very early. if anything, the amount of damage will increase as we go forward. for now, the focus from the prime minister is on helping those who have been displaced from their homes. infrastructure has been effected, bridges out, bullet train not running, airport shut down because of problems with equipment there. food focus is how we get to the people who have been affected by this disaster, and we have 25,000 people involved in that effort. angie: what are emergency officials and government doing
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about that today? the focus now is getting food and water to the area, making sure that those who have been left homeless have shelter. we have reporters on the ground there. visiting municipal centers, finding hundreds of people sleeping in the hallways, talking to people who are saying a riseey managed to get ball and a bottle of water and are feeling good about that -- a and a bottle of water and are feeling good about that. even psychologically, just welcoming people in need of food and drinks, that is a big thing for the people there. despite ofall normalcy there. absolutely important as they struggle to get back to normal.
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thank you. stories making headlines around the world. the leading candidate for the philippines election regrets his language after joking about a woman who was raped and murdered. a video emerged showing him telling laughing supporters that he was angry that such a beautiful woman had been killed. opinion polls, but rival candidates say his comments show he is not fit to hold office. china's second highest ranking military commander has visited the disputed islands in the south china sea. of military and civilian officials to inspect construction projects on what china calls the disputed islands. itt week, the u.s. said would launch joint patrols of the airy with the philippines. airways flight has
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landed safely after being struck by a drone. the pilot reported an object hitting the front of the plane, which had 137 passengers and crew on board. it is thought to have been the one hasime that a dr collided with an airliner in the u.k. powered by over 2400 journalists and 150 bureaus around the world, this is bloomberg news. angie: coming up, they'll strain casino operator looking to attract more chinese gamblers to sydney. "first up" back in two. ♪
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angie: sources have told that is looking to raise $1.5 billion in a bond sale. the company has declined to comment on the report. china's internet giants are finding haven for bond investors. could be in line for one of the best years ever after the jungle book topped the box office. live action retelling brought in more than $100 million. barbershop the next cut came in a distant second. four $1ould see
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billion this year. of hottest version lamborghinis new car has landed in hong kong, more than 600 horsepower, and accelerates to 100 coulomb per hour in just over three seconds. we went for a spin. -- 100 kilometers per hour in just over three seconds. we went for a spin. >> all right. ♪ >> this is so scary. ♪ here has three modes in the car, street, sport, and race. >> how fast can it go?
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>> much quicker than you need. 02 100 and 3.4 seconds. of moodds on what kind you are in, and the car and apps to what you need. this car is catered towards the fun to drive market. the first one that has officially landed in hong kong, right? the first one.s >> let's take it for a spin. ♪ >> watching out for the police. oh, come on. you knock and a pull me overcome are you? that's what you're paying for, respect on the road. ♪ i'm going to work really hard
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to get one of these now. angie: that was yvonne man taking a lamborghini for a spin. welcome to the stock exchange. let's check in on what our reporters are watching this morning in asia. ok, winner gets a lamborghini. all right, give us some empty promises. >> who is the winner here? >> apple may be cutting its iphone production by 30%. gets more than 40% of its revenue from apple. >> how are you feeling? >> feeling good. energy producer, self-explanatory, high data stock -- beta stock. >> i was waiting for somebody to
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pick oil. my stock ended up making money today. >> that is true. >> life altering returns. it is the state owned travel service to get more chinese tourists gambling in queens land. can come toey queens land for the sinking in a -- for the action there. >> thank you, guys. that's the verdict from the stock exchange. that is it for us on "first up" today. yvonne: oil, the continuing fall, dropping the most in two months. that's after the collapse of talks in doha.
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what does it mean now? we will also be breaking that chinese property data coming out in half an hour. housing demand spur growth in china, but over the weekend we did get that 1.1% quarter,gure for the taking the shine out of that 6.7 figure we saw. storage, the disruptor and a data, and how they use flash memory and chips to store your data. we will be talking about that with the ceo. ♪
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yvonne: good morning. it is monday, the 18th of april. i am yvonne man. this is "trending business". ♪ we are going to be live in singapore and sydney, but after oil on the slide marathon talks ended in failure. nations said they would not cap production without iran. pulled stocks down


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