Skip to main content

tv   Bloomberg Daybreak Asia  Bloomberg  April 3, 2018 7:00pm-9:00pm EDT

7:00 pm
♪ kong,: 7:00 a.m. in hong live from bloomberg's asian headquarters. i am yvonne man, welcome to "daybreak asia." releases its $50 billion china tariffs list. products highly prized in beijing. trade war,lobal china says it firmly opposes the move and will hit back in kind. betty: that tit-for-tat ratcheting up. i am betty liu in new york. tesla is bouncing back with better-than-expected numbers, expecting a dramatic rise in production. spotify hitting the right note
7:01 pm
after an unorthodox trading debut, the market value the company at $27 billion. ♪ betty: today was certainly risk on, trading green across the board in the u.s. markets, but if you look at this chart, it will show you have a relative performances of the stocks versus bonds -- take a look at this. within the last couple weeks has plummeted, showing any aggressiveness by investors is rapidly dissipating, whether you look at stocks versus bonds or cyclicals there's -- versus defensive. it brings up the question, how long a rally like today will last. yvonne: is it a relief rally we are seeing?
7:02 pm
now that we see the list of $50 productsf targets -- targeted on chinese imports, a could change the game. the damage has been limited to stocks. we will see if that will spread. betty: in the meantime, let's bring up the boards and how we closed the session today. we saw as i mentioned, a rally all around. rising 1.3%, the dow adding almost 400 points. the nasdaq trading up 1%. we are going to be awaiting the reaction in asia to these tariffs announced by the u.s. yvonne: we heard strong words from china, same scale, same intensity in terms of retaliatory measures on trade. let's take a look at how things are so far. good for new zealand, the nzdx up 0.5%. we did see a strong bid for dollar overnight.
7:03 pm
sydney futures looking like this. the rba left its cash rate unchanged at 1.5% yesterday. this is what we are seeing in australia so far. looks like we can be continuing those gains after we were flat on the aussie, at .7676. we are also counting down to the open in japan and korea. we are seeing moves and dollar-yen, strength, 106.54. so far, futures pointing to solid gains in tokyo today. although it has been a rough year for japanese equities overall. betty: let's get the first word news with jessica summers. >> the bank of japan has confirmed it is talking about an eventual retreat for massive stimulus. it is still too early to offer details. kurodar kuroda of --
7:04 pm
said it will depend on conditions at that time. fromid inflation is far the 2% target and he will continue with stimulus until that goal is reached. san francisco fed president john williams is moving to new york. he is putting up my terry economist in jerome powell's inner circle to help oversee wall street. williams spent most of his career at the fed and is considered a centrist. he will replace william dudley on june 18. he favors three or four rate hikes this year. tesla surged after releasing model three production figures, saying it will not need to raise more money. output is of 2 -- the lower than expected, but better than feared. billion, and expected to
7:05 pm
burn through another $2.5 billion this year. saidorld biggest ad agency it will have independent counsel to investigate personal misconduct against a ceo. an inquiry is under way against -- when they reported possible misuse of assets. said allegations do not involve anything material to the agency. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. i am jessica summers. this is bloomberg. ♪ betty: a closer look at the u.s. market close, the s&p turned early losses into gains. stock and bond yields rising, after the report the white house is not seeking action against amazon. look atn, with a investors shifting to the earnings report. >> they are expected to be positive.
7:06 pm
, that report clarifying there is no actual action pending. checked the snapshot, definitely made it a risk on day. of you that smart money would buy some of the beaten-down tech. expectationhigher, the wednesday supply data result will show a large decline, supportive of higher price. let's take a look at the fang trade. that bounced back with the market in the afternoon. facebook had been lower, even as other stocks rebounded. not large gains. let's go into the standout stocks. that is what you see the major moves. in the spotlight, spotify. this was an unusual ipo. we will get to that in a minute. it passed on 13% by the end of the session.
7:07 pm
tesla reporting numbers not as bad as feared. that helped prop up the stock. cbs and viacom, talks of a merger back in january, cbs and now submitted its bid to buy viacom and comedy central. that will likely develop as the week goes forward. let's go into the bloomberg. equity volatility surging is the big theme in recent that -- recent weeks. follett till any more muted for currency in the bond markets. yellow is the currencies, blue are the bond. white ticking higher is the vix. goldman is saying this increase in stock market volatility could go to other price -- could suppress risk appetite. that is something the "smart money" is following. yvonne: we have seen signs of
7:08 pm
stress. spotify surging to the public debut, $27 billion. a very unusual rout. did it pay off? su: the consensus is, it did, indeed. a 22% pop up early in the session. it tended to taper down, closed with a gain of 13%. what was unusual for a large, established company which would therelly get advisors, would be a pre-ipo pricing and established shares would go up -- all shares that wanted to go up went up by other shareholders. it was supply and demand that set the price. yvonne: back to you. back to one of our top stories, police in california said a woman shot and injured three
7:09 pm
people at youtube headquarters before apparently killing herself. get to bradt's stone in san francisco. i know you have been covering this story for the past couple hours. give us the latest. brad: our whole team has been covering it. here in silicon valley, or san bruno, california. the incident happened at 12:45 pacific time. the san bruno police department tweeted out there was an active investigation around 1:00 p.m. youtube employees were seen streaming out of the building with their hands up. the alledge suspect is deceased of a self-inflicted gunshot wound. the san bruno police chief revealed that in a press conference. there were three victims, reports of a fourth, unconfirmed. the three victims are all alive. they are at san francisco general hospital, one in critical condition.
7:10 pm
the chief surgeons said they are all awake and aware what happened to them. it seems like maybe not the worst case scenario. we do not know yet the motive, who the suspect was. there are unconfirmed reports this was a domestic situation. lots of people wondering why this happened. betty: absolutely. such an unusual incident at this prominent silicon valley company. what is the significance for the community there. violence in america has touched a lot of schools, colleges, federal government institutions, but not the tech companies in silicon valley. as we have seen this year, tech companies are rising to unrivaled prominence. they are the center of so much in theand agitas political environment. youtube a couple weeks ago banned all youtube via -- videos
7:11 pm
related to gun sales or gun promotions. the nra was tweeting out they needed to rise up in opposition against youtube's policies. environmenting where tech companies might be targeted. these coordinated political actions. we do not know what was behind this, but it has everyone shaken. a lot of these buildings in silicon valley are not that well protected. how can you protect against something like this? it took a lot of people by surprise. inty: thank you, brad stone, san francisco, with the latest on that shooting. a trade representative issued chinese products facing $50 billion of new tariffs. that sets the stage for a potentially bruising trade war, with beijing responding it will respond in kind. tom mackenzie has the latest. come backhe chinese
7:12 pm
and say they would be retaliating in kind. how will these tariffs impact china first? tom: these tariffs are being on 1300 different products exported from china to the u.s. what is interesting, they are largely focused on high-tech goods. for example, medical equipment, industrial equipment. whichr example, shoes, has been a concern for retailers in the u.s. to be drawnttempted to protect u.s. consumers to some degree. they articulated that in their decision, or proposed decisions. the 11th of may before these are put into place. what china is going to be concerned about is the targeting of their made in china 2025 plan, a central policy for president xi and his team.
7:13 pm
the fact of the u.s. zeroed in on this, they will be concerns about threats from the u.s. to draw up higher barriers for chinese investments in tech and innovation in the u.s. that will be a deep concern. obviously, tariffs on metals will have limited impact on the chinese economy. these will have more of an impact, but unlikely to be disastrous. it is trade tensions and concerns about where this goes from here that will be at the front and center for policy makers here in china. yvonne: this is where it is going to hurt more, where you target china high-tech. we have response from china, they will take the same reciprocal tariffs on u.s. goods. what is that going to look like? tom: not a surprise. china has long said it would take reciprocal measures, protect its own interests.
7:14 pm
that is when we heard from the ministry this morning. they said these measures by the u.s. violate the principles of the wto, and they strongly oppose them. what it will look like is probably similar. they put in place $3 billion of counterterrorist monday, pushing back against aluminum and steel tariffs. now we will be looking at whether they target soybeans, and sorghum, those high-volume imports from the u.s. to china. also, if you are a boeing or apple or intel, you will be concerned at this point. the structure of china, they have not wanted to exacerbate these tensions. they wanted to pursue dialogue, and that has been a key call from policy makers in china. they do not want to be seen as weak by their international audience. waiting for details as to
7:15 pm
how china will respond. yvonne: thank you, tom mackenzie, joining us in beijing. we are counting down to asia's first market open this morning. taking a look at japan futures, perhaps when it comes to the dollar-yen, we are seeing more risk off moves this morning. we will continue to watch all of that. still ahead, tesla shares rebounding after the surprise on its production numbers. we get the outlook with carlab founder eric noble. yvonne: rebound on wall street. this is bloomberg. ♪
7:16 pm
7:17 pm
7:18 pm
7:19 pm
7:20 pm
7:21 pm
>> you are seeing new strategies.
7:22 pm
>> it is a time when you look at something like this and what is happening and rethink your portfolio. we had howard buffett on he is also a farmer. war,lked about the trade what he thought would be the impact on agricultural companies. >> here is the back -- agriculture has been the backbone of trade. ,ou start a trade war on china agriculture will lose. it is an important market to us. as far as i can comment on agriculture, i think that can be very hurtful to u.s. companies in the u.s. farmers. betty: could we be underestimating that impact? again, i think if the trade war accelerates, it will be bad for agriculture. toot now i think it is
7:23 pm
early to make major that on the market based on this trade war. i have confidence in the u.s. and move forward. i think the market is going to start moving up again, although there is pressure because you will have a lot of interest rate increases over the next two years. as people do not think this will escalate. if they did, the market would have already sold off. betty: i want to pull up a chart i showed earlier, which shows relative performances against -- of stocks against bonds and how it is declining. it really tanked over the last month. you expect that to continue going forward? of the s&pw the pe 500 is 15.4, which is above historical averages. the sentiment is becoming negative. you had interest rates rising, a lot of people value stocks based on the present value of future earnings.
7:24 pm
if you are going to have all these interest rate increases, it will impact stocks. over the next, two years, stocks will not do that well. much, on theyou so markets. you can get a roundup of that story and many more to get your day going in today's edition of daybreak. bloomberg subscribers go to dayb on your terminal. you can also customize your settings to only get news on industries and assets you care about. this is bloomberg. ♪
7:25 pm
7:26 pm
♪ a quick check of the latest business flash headlines. pressing ahead with plans to sell its flash memory chip unit, despite a range of regulatory hurdles. a new ceo took over this week. he said it would -- it would
7:27 pm
take substantial changes for toshiba. covera is selling to aliens of dollars of losses at its u.s. arm. yvonne: amazon end of the regular session in the green after sources in the white house said the ministration has no current plans to regulate the company. president trump repeated his saying the u.s. postal service loses money delivering amazon packages. amazon reversed declines it had raise ont intraday news of an action from the white house. betty: accusing a samsung parent of using its messaging technology, a similar complaint against facebook last month. blackberry examining a potential suit they accuses a snap of infringing upon patents. two of those are among the seven blackberry patents in a suit against facebook filed march 6.
7:28 pm
spotify shares hitting the market with a whimper, not a bang. quite an unusual debut. this is bloomberg. ♪
7:29 pm
7:30 pm
morning inutiful hong kong, 7:30 a.m. wednesday in the city. we are coming back from a holiday, but also the eve of another holiday, a festival, so no trading. minutes away from asia's first market open. betty: it is 7:30 p.m. tuesday here in new york. city, streets of new york you can see that traffic jam in rush hour. smooth sailing in the markets, for the bulls. the s&p up over 1%. i am betty liu in new york. yvonne: let's get the first word
7:31 pm
news with just the summer's. the u.s. trade representative issued a $15 billion hit list of chinese products that could face new, 25% tariffs. covers 1300, including aerospace, i.t., communications technology, robotics and machinery. it will face public review before final determination in may. china has promised reciprocal tariffs on u.s. products. police in california say a woman shot and wounded three people at youtube's global headquarters in san bruno, california before killing herself. one man with critical injuries. the security teams worked with authorities to evacuate buildings and ensure the safety of employees. removed says it has more than 130 accounts on its social networks that were controlled by a russia-based
7:32 pm
agency. they say they were targeting people in russia itself or a neighboring country. facebook says the investigation into pages linked with russia has been running for months. japan's new guidelines on casinos are seen benefiting big players. an entrance fee of $56 for local tax ons, plus a 30% gross gaming revenue. a limit on the casino floor space. a mixed response among resort operators in new york. we will keep an eye on their hong kong shares later. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. i am jessica summers. this is bloomberg. ♪ yvonne: jessica, thank you. we are counting down to some of the major market opens in the asian pacific. let's get more with sophie kamaruddin.
7:33 pm
we saw bounceback on u.s. stocks before we got that hit list on tariffs and chinese imports. it will look interesting. >> interesting is one way to put it. look sharp, a volatile session ahead. likely helped by u.s. stocks turning risk on. the amazon rally, sparked by relief the white house says it is not targeting the company. ofwait for full scope china's response to that hit list on tariffs. beijing says it will respond in kind on the same scale, proportion and intensity. the yen holding near overnight lows. to see whate coming is the knock on effect of that tariffs list, and if it will have effects on the supply chains. the tariff targets airspace and energy vehicles and robotics. keep an eye on japanese robotics maker's.
7:34 pm
they may be drawn into the vortex surrounding this china tariff list. one comes under pressure as new orders can seem -- seen presented by other issues. itnne: and u.s. car sales, was a mixed bag for these japanese carmakers. >> it was a blockbuster month for carmakers, declines posted in the first two months of this year. toyota and nissan missing projections as deliveries fell. 3.7%n seeing a drop of compared to an estimated decline of 2.1% for march. honda beating estimates, thanks to rising sales of the pilot suv. report a 13% drop in deliveries to china last month. this will be in focus, given china has indicated it is hoping
7:35 pm
to temper the dispute with south korea, as well as the region. let's look at hyundai. this after elliott management, run by pulsing or, a more than $1 billion stake has called for a call to improve operations. this comes after they simplified the structure last month. holdings were in hyundai, kia, and another. fare thise how they wednesday. betty: watching the reaction to those auto sales numbers. fed, theyeat on the have selected san francisco fed president john williams to be its next president. a move undoubtedly endorsed by jay powell, decreed by others, as it moves away from
7:36 pm
much-needed diversity at the fed. kathleen hays here with more. it will be john williams. here's johnny, that is what people are putting on their emails they. john williams were placing bill dudley, retiring. the new york fed has come through with its selection. let's remember why the new york fed is so important, why there is so much focus on this appointment. new york fed, first among equals. the new york fed is a permanent voter on policy, the others alternate vote on the fomc. vice chairman of fomc, much closer as advisor to the chair, which bill dudley certainly was to janet yellen. overseas big wall street banks and conducts open market operations. this is more and more important is the fed normalizes policy.
7:37 pm
what does john williams bring to the table? let's take a look. he is a phd economist from stanford, spent a month his entire career at the fed, became president of that bank in 2011, had the r-star neutral rate. a proponent of rethinking inflation target. not a banker, so how will the oversee big banks? he lacks market expertise, which could be important, as it was during the financial crisis, something bill dudley was lauded for. jay powell is very important in he sees williams potentially as someone he has worked with for the past five years who will be a strong, confident advisor on monetary policy. yvonne: given the fact that there was\leading up to this
7:38 pm
decision on a lack of diversity, what is the reaction been so far? praising jay powell john williams for his insight and wise guidance, alluding to their time on the fed board of governors. janet yellen strongly supports john williams. he succeeded her at the san francisco fed, pushing for quantitative easing when it was controversial and first needed. why is the controversial? he is another white, male economist. let's see how that is stacking up against other candidates. there is a question of no financial market experience. he oversees wells fargo. he was in the president's seat when wells fargo had problems with creating fake accounts. so he is criticized for that, particularly by elizabeth war and on the senate banking onmittee -- elizabeth warren the senate banking committee. they looked at 60 candidates.
7:39 pm
30 were either white males. i think they feel they found the right one. marian bailey has been at the san francisco fed. she is seen as a likely candidate to replace him. may be a hawkish centrist. sees three or four rate hikes this year, someone that will have more influence. yvonne: perhaps, more in line with jay powell as well. thank you, kathleen hays. spotify made its debut on the new york stock exchange, skipping the traditional ipo process in favor of a direct listing. let's go to an analyst watching performance today. spot if i avoid a to malta was tumultuousvoid a debut. was it successful?
7:40 pm
may besupply of shares more than admitted. a big chunk of the company is held by strategic investors. on they still be sidelines. as far as the listing goes, more smooth, but the volatility anticipated and expected, will continue for a bit. betty: is there any sense others might follow suit with this? >> that is why we have to wait for the supply and demand balance to show what it leads to. compared to other ipos, the numbers look leser in terms of supply restrictions. as more sellers come to the marketplace and there is more normalization, that should be a bigger motivating factor. as far as what they have shown today is, if you're a big brand name, you are not raising money. or if you are, but want to go to
7:41 pm
direct listing, it is an option for you. at least it was uneventful. betty: that was the neutral part of it perhaps. thank you so much. onto the media world, sources tell us cbs has a bid for emerging forling the two networks. we know cbs has made a below market bid, had ideas on management. they are either together-a part -- apart, or together again. >> right now, there apart. it has become about the personalities.
7:42 pm
the ceo of cbs has done great things. they did not want it to be about the person out she wanted to be about the special committees of the two companies getting together to decide whether this was a merger worth its merit. however, it has quickly become about that. it comes down to price and management. betty: they have their own ideas of who should run. >> he wants to run the combined company. coo, theumber two, the former cfo of cbs, on the other ceo hase viacom support. she would like to see him be the number two because for her, it is all about delivering synergies analysts are talking about, money that can be
7:43 pm
unlocked from this merger. she feels she needs someone who knows these assets to be in charge. yvonne: will there be a deal? what needs to happen? >> let's see. outy there were reports that the father, the original person who controlled nia, communicates by an ipad. it has three responses. they are telling us what he would have said. it,t now, when you look at it is an initial offer. the price is one thing. that is coming with a below market bid. they are looking for something on market, plus a share in management. those are the two things outsourcers are telling us now. when you look at it from the other side, they have done a
7:44 pm
great job with cbs, and does have investors on his side. he wants someone of his stature to be running the company. yvonne: sounds like a soap opera in the making. thank you, joining us from new york. tesla mrs. production targets, but not as badly as feared. we look at the numbers with carlab's eric noble. this is bloomberg. ♪
7:45 pm
7:46 pm
♪ we are counting down to asia's first major market opens this morning. japanese futures paring back from gains we saw earlier, but still showing a higher open, following the gains we saw in u.s. trade tensions, trade war, on
7:47 pm
the minds of many investors area this is "daybreak asia." i am betty liu in new york. i am yvonne man. getting updates on the youtube shooting in san bruno, california. a woman shot and injured three people before killing herself at google's youtube headquarters. we have is formation that it is contained. they are thankful to first responders and the security team. in a memo to staff, four people have been injured at youtube. there were misleading lines about the numbers, three or four. but they say, four employees injured in this. still no motive about this shooting today. betty: we will keep our viewers updated on that situation. tesla shares rebounding today. the stock rising as much as 8% before closing the day, up nearly 6% in the end.
7:48 pm
it fell short of its self-imposed production target for the model 3, but they say the performance was not as bad as feared. let's discuss this with carlab the founder, eric noble. not as bad as feared -- is that good enough? eric: no, that is not good enough. at as bad as feared was couple thousand production units for the month, as far as we know. this is a planned, in full production, should be doing 10,000 units per month. not as bad as we thought it might be. when musk himself is publicly indicating he will solve the problem by sleeping on the factory floor, if that is what it takes, you know the problem is not in need of heroics, it is in need of process. when we will make vehicles in volume with consistent quality, that is a question of process,
7:49 pm
not the romantic ideal of an executive willing to work all night. production of model 3 started to early and it is showing up in quality, low quality. that will bite them, because it will be hard to come back from a poor start on this model. betty: i will get to the quality part of this. i know you are referring to the tweet must send out saying, i am going back out on the factory floor and sleeping there, which it generated headlines. i am also referring to perhaps good enough for creditors. there has been a lot of talk vendors might start to ask for their cash bid earlier, worried about possible bankruptcy here at tesla. if they see these production goals are getting nearer to their target, is that enough to keep them at bay, so tesla does not fall into a cash crunch too early? eric: it is a good question.
7:50 pm
i don't think automotive suppliers are going to be the ones that will beat tesla and problem.usk's they are used to not getting paid at times. it is part of the risk for an industry as a tier one supplier. another problem is cash flow. their shareholders and bondholders -- the problem for model 3 is the promised revenue associated would be necessary to take the company through 2018. at this point, those revenues do not look like they will happen. betty: what do you mean by the quality of these model 3's? were around us who
7:51 pm
the early unit sold of model 3, if we have any industry experience, what we are looking at is a preproduction prototype. sort of unit another established carmaker would run through the assembly line and then take a look at to see where the quality issues were, go back and correct those issues on the production line, and in the process. ultimately, those units are never sold. in fact, they are crushed. when we look at model 3's sold to customers who had deposits down for months and these units are on the road, we are looking at loose weatherstripping, very poor paint quality, and body gaps frankly, that you could swing a cat through. these are very poor units, eastern bloc level stuff they are releasing to the public.
7:52 pm
it indicates production was not ready for prime time. it means you will have a lot of dissatisfied customers. we all realize early buyers of model 3 will be fan boys and fan girls of the brand, but ultimately, will they tolerate quality levels this low? if they won't, tesla will have a twofold problem. a, they brought it into production to quickly. b, they will be mired in warranty work. yvonne: should they try to make production targets or maintain this image of being an innovator when it comes to manufacturing batteries and ai? eric: look, a little of this is water under the bridge. the best thing would be to acknowledge it requires x number of months for production, even in the most modern factory.
7:53 pm
tesla tried to skip steps, now they are being burned by that. now, they should go slow to go fast. if they are going to hit 10,000 units or more per month, and do that consistently at high quality, they need to implement process. clearly what we are seeing in terms of input level and quality level, process is missing. to establish process takes time. they are better off telling investors, hold back, we will stay at 2000 something units per month until he gets dialed in, then we will turn the wick up. right now it looks like gymnastics. in the short term that might work, but in the long term, it delays high-quality production, which is what they need to survive as an entity. yvonne: production at what cost. thank you, don't forget our interactive tv function. join us live and catch up on
7:54 pm
interviews and dive into securities or bloomberg functions we talk about. plus, become part of the conversation by sending us instant messages. this is for subscribers only. this is bloomberg. ♪
7:55 pm
7:56 pm
♪ this is yvonne: "daybreak asia." i am yvonne man in hong kong. betty: i am betty liu in new york. iniott management. a stake hyundai motor group entities and is calling for a plan to improve operations. the hedge fund it praised hyundai for simplifying ownership structure after years of criticism. elliott says more needs to be done and is seeking talks with management. yvonne: starbucks countering slighting growth at home with surging demand and south korea. its local unit runs cafes. operating profits surged 34%
7:57 pm
last year. south korea has been experiencing something of a cafe craze. billion.almost $4 betty: the stage is set for possibly the final round of telecom control in india. planning to sell notes to bolster forces. investors hope it is the endgame in a bruising battle. india mobilet market and forced smaller players to merge or quit. yvonne: committed to winning the race, saying none of the other bidders have as strong a track record. they are to challenge regulators decisions on the bid for essar.
7:58 pm
there is a consortium to make an offer. hour, bondse next retreat as markets resume their risk on position. we look at the outlook in 10 minutes time. this is bloomberg. ♪
7:59 pm
8:00 pm
>> 8 a.m. in hong kong and we're live from bloomberg's asia head orders. i'm yvonne man. welcome to daybreak: asia. the u.s. releases a $50 billion china tariff list in the targets are tech products highly prized in beijing. the stage set for a global trade war. china says it opposes the move and will hit back in kind. expecting dramatic rise in production this year, and ramping up pressure on mexico.
8:01 pm
the risk aversion has dissipated a little bit here. that's what we saw in the session. the spotify ipo looked pretty successful so far. and reports from the bloomberg team that the white house is not really planning any kind of regulation. asia will get interesting other on chinese imports. comments coming from the chinese side but we need more detail before we see any real serious reaction. you are seeing markets in asia and just a touch higher. whatll continue to watch
8:02 pm
develops throughout the asian trading session. let's get to first word news. we have more. >> a woman shot and wounded googleeople at headquarters before killing herself. no motive has been given for the shooting and one man left with critical injuries. will says security teams worked to evacuate buildings and ensure the safety of its employees. he is considered with interest on monetary policy and will replace bill dudley, favoring three or four rate hikes this year. the bank of japan has confirmed it is talking about an eventual
8:03 pm
retreat from massive stimulus that says it is still too early to offer details. they're holding internal discussions. it will depend on conditions at that time. he repeatedly said that inflation is far from the 2% target and will continue with stimulus until that goal is reached. tesla surged after releasing model three production figures. it it will not need to raise more money. of 2500.low the target expectsso says it reduction to decline rapidly this quarter. the debt stands at $10 billion and is expected to burn through another 2.5 billion this year. global news 24 hours a day powered by 2700 journalists and analysts in more than 120 countries. this is bloomberg. take a look at the
8:04 pm
market open and what we have seen so far when it comes to asian markets. let's get the latest. we see some moves from the dollar-yen. and from the u.s. given the reality, it released around amazon there. and given this long litany of items on the u.s. tariff list again, we are seeing this, of course, very much in the spotlight. we are gains across asia. gaining .4% as we have the , over in australia, games also for sydney. the nikkei 225, we have tech and consumer shares leading the charge. that is a signal that the move could be lifting.
8:05 pm
talks were going on behind closed doors. this happened right about here yesterday afternoon. prices come aussie off of steam earlier this week. a check in on sony shares after the company revealed it sold 17.2 percent of the state can spotify. ¥125ting to book a gain of billion in the first quarter. later,g for reaction given it has a 9.1% stake in the company. betty: issuing a list of chinese products facing $50 billion in new tariffs.
8:06 pm
>> china has said it strongly opposes the measure that they go against the values of the wto and that china will reciprocate. they said that china would take measures an equal strength and size. the rhetoric is pretty strong from china. the fuel on the fire, they want to have dialogue but equally they have said that they are prepared to reciprocate to protect their own interest. $3 billion worth on monday in
8:07 pm
retaliation for washington's decision to impose tariffs on steal and of human them imports from china. or whether they will take measures to crimp the activities like boeing and intel and apple who, of course, derive many of their sales from the chinese market. the summit kicks off next week. whether or not they wait for the end of the consultation in the u.s., this is where they see it of course. >> how likely these are two china again?
8:08 pm
>> it is about industrial products rather than a direct consumer products like shoes and clothes. the u.s. has said it was to shelter as best as possible u.s. consumers. it will be the focus on the made in china 2025 strategy which is about moving up the food chain. robotics and electric vehicles. we want to further restrict chinese access to technology and innovation in the u.s. which is a key component for beijing policy. it will be a key concern.
8:09 pm
they want to remain for talks at some point and playoff the efforts to open up. we expect to get more details and announcements. to highlightt their moves to restrict or ease reducingons around their own tariffs on imports a new electric vehicles and opening up other sectors like telecoms. it is very likely as china tries to undermine efforts to open up some sectors. cracks the bloomberg north asia correspondent joining us from beijing. a president trump has continued attacks on amazon, telling reporters the company has the money to pay, "a fair rate to the post office." joey schneider joining us now. we continue to see this rate on twitter.
8:10 pm
what led to this rebound overnight is the fact that the white house reportedly had no action targeting amazon. >> a new tweet about amazon and no realal service, action. game -- the biggest intraday gain in a while. the administration decided to take some action. the department with antitrust violations. , and attorneys general watch it enforce, getting sales taxes from third-party vendors.
8:11 pm
the billion dollar contract, a lot of things that could the own talk on part of president trump and the administration against amazon. betty: what is happening with the u.s. mexico border and what is president trump want to do? today?nt trump earlier clearsident trump made it about the border with mexico and talked about trying to build that wall. it comes at a time to
8:12 pm
renegotiate nafta. they've been trying to do this for some time. the president criticized the deal a lot. if mexico does not give assurances that it will help protect that border that he may before a summit in peru next week. the president is also threatening to not do that if mexico doesn't step up. betty: what about the environmental protection agency chief? what is happening there? >> the president has called told him he and supports him. he should have his back and he should keep fighting. mr. pruett is under a lot of scrutiny right now for travel, hiring practices, and for an unusual condo. noise.s a lot of
8:13 pm
the president gives those kind of assurances. and the person is gone shortly thereafter. betty: the uae said deal to curb output would be there. yvonne: the san francisco fed president and the powerful new york fed, what it means for central-bank policy.
8:14 pm
8:15 pm
♪ yvonne: this is daybreak: asia. it betty: the new york fed getting a new president. john williams will succeed bill dudley when he steps down in june.
8:16 pm
yvonne: and these high-profile appointments, what betty's alluding to is too many white males in these positions. to you whye explain the new york fed is so important and why this job is so important. every meeting, the permanent voter. president, ited does have to have market experience because when a financial crisis hits, you've got to know how markets react. there are many reasons why this gets so much focus. what does john williams bring to the table? is thesis advisor when he got a advisor, went to become an
8:17 pm
economist and head of research. they pioneered the neutral rate thesis. banksortant for central around the world and he's not a banker. once the reaction so far? powell wanted a strong monetary economist and advisor. he praises john williams for his insight. they worked together for five years. howell on the board of governors , they know each other very well. janet yellen replaced him and became fed chair, a woman, by the way. she strongly supports john williams. this election is controversial. he is a white male at a time when people say we need women,
8:18 pm
when he people of color, we need more diversity within the federal reserve. no financial market experience. john williams is in favor of three or four interest rate hikes a year. this is the part about policy. this makes him more of a centrist. advisor, vice chair. he will be that much more influential. yvonne: we have been digesting not just this tech selloff, but the treasury yield writing just
8:19 pm
a bit. does john liam's mean the fed vice chair mean much when it comes to fed policy? it doesn't at or do track anything to the debate right now. >> i think john williams is a bit of a centrist. he started as a dove and a big proponent of massive bond buying. let's start hiking rates. perspective,ket what is the mistake that the fed could make?
8:20 pm
>> it is quite seasonal and we have seen softening numbers. we want to see the consumer bounce back here. if we're coming into a soft patch. it will continue on down that path. we're watching the numbers and i think that is key. we want to continue to see the balance sheets unwinding. in lusaka focused road a trying to discuss and indicate an unwind of qe and how that has the market thinking now.
8:21 pm
it is were the market is focused on the moment. >> what you make of u.s. treasury market. in the last few weeks. what is happening in the equity market, the tech selloff. it has been affecting yields on the 10 year. what did that tell you about investor sentiment? >> a think everyone is quite conflicted and assuming that rates will go up. many people talking about it going up. what will happen with risk markets. they jumped ahead of that. that puts pressure into keep the 10 is quite well here. that is giving you an indication that the market is the big
8:22 pm
elephant in the room and telling you that all things are not well at the moment. >> we saw this in the market as well. this is gtd 8994. -- gtd 8994. more than 50 basis points, will we see more for the repricing? >> what we have seen here is particularly asian high-yield is sold off dramatically. we are at a premium now. we're getting quite excited about that. we look for an opportunity here. we had quite a lot of supply coming to market. issuers,igh-yield
8:23 pm
coming off the dollar market and putting a little bit of pressure on this. we see this as an opportunity now. around 7.5%. >> and what can upset the chinese argument? is it on the doorstep or not? >> will with a good other trade war, we look at some of the examples. this one really smells like what happened with japan. so there was a lot of noise. there was a trade panel set up to negotiate. at the end of the day, not much got implemented. in this case, we're focused on if there is substitution. can the u.s. put a trade tariff on and substitute locally? i think once the administration
8:24 pm
gets feedback from the public and from the manufacturers of the day, they will say, listen. us domestically rather than just kickstarting something else in the u.s. economy. much, head ofo fixed income. and bloomberg's global policy editor kathleen hays joining us as well. you can get a roundup of that story and many more that you need to know to get your day going in today's edition of daybreak. bloomberg subscribers can go to tv on their terminal and on mobile. you can customize your settings so you only get news from the industries and the assets you care about. is bloomberg. -- this is bloomberg. ♪
8:25 pm
8:26 pm
>> amazon ending the regular session in the green. no current plans to regulate the company.
8:27 pm
president trump continued the twitter tirade in planning the u.s. postal service loses money on delivering amazon packages. amazon posted the biggest intraday gain in a week on news of the in action at the white house. facebook last month. revenue sources let blackberry to examine the complaint accused of six patents issued in 2012. among the seven blackberry suit against facebook filing on march 6. controlled by the redstone family, we are told cbs manage it would lead the combined company. viacom rose. couple of days on speculation
8:28 pm
over the possible terms. productionrbing on has dramatically slashed the glut. this is bloomberg. ♪
8:29 pm
8:30 pm
yvonne: >> it is a 30 a.m. in singapore and half an hour away from the open of trading there. let's get to first word news with ramy. ramy: the u.s. trade representative has issued a list of chinese product worth $50 billion that now face new 25% tariffs. this covers around 1300 proposed tariff lines including aerospace, i.t., communications technology, robotics, and machinery. it will face further public review before any final determination. china says it firmly opposes the measures and will retaliate in kind.
8:31 pm
the worlds biggest ad agency said it is appointing an independent counsel to investigate allegations of cooonal misconduct against martin sorrell. reporting a possible misuse of assets by wpp says the allegations do not involve anything material to the agency. he rejects the allegations "unreservedly." thanook has removed more 130 accounts on the social network and instagram that were controlled by the russia-based internet research agency. the pages that had content were targeting people in russia itself or a neighboring country. a facebook says the investigation into pages linked to russia has been running for months. japan's new guidelines on casinos are seen benefiting big players in large cities.
8:32 pm
they also scrapped a limit on casino floor space at the las vegas sands and others had opposed. there was a mixed response among resort operators in new york and keeping an ion their hong kong shares. by more than 2700 journalists and in more than 120 countries. this is bloomberg. how thetime to see asian markets are shaping up so far this morning. >> you are seeing gains at the start of the session easing as a nikkei 225 is trading by what 1% higher. it is said to snap a today why -- a today rise. they do have the yen gaining ground. and the cost be is on track for a third day of losses. also on the back foot, aussie stocks are falling for a fourth straight session.
8:33 pm
led by utilities and industrials. check out the offshore. they expect u.s. trade pressures to lift. take a look at what is moving the dial in japan. the worst performers on the nikkei 225 so far this morning. isck in and the stock sliding. it maker losing as much as 11%, the most since march 2011 after earnings missed estimates and sales did beat. makerdustrial machinery outperforming and makes stuff like conveyors and assembly robot. you have samsung and group shares the biggest drag so far on thecost be based report that sam son is being probed by south korean prosecutors on antiunion allegations. let's check in on the
8:34 pm
leaderboard. it you have shares climbing after management bought a stake motors,ai motors, kia and getting 3.6% so far this morning. betty: another update on the markets. removed the deal glut. talked about whether he is worried about a potential trade war. >> i am not that concerned about a trade war. adding to the market, i think this commodity is unique. affect the cost of completion. but i think, overall, that will effectively be enough to the oil prices.
8:35 pm
and the commodities have been resilient over the years. i think it is more affected by supply and demand. >> let's talk about what you're trying to achieve on the supply side. theaps looking at benchmarks, help me understand. in vienna, there was a bit of a five-year average which i know you have in the market. it is what you're using. and the seven year average. which one does the market need to focus on? >> we need to achieve the basis of what we agree on. and that is talking about the five-year leverage, talking about it. and the deal was based on the five-year average. question.her i would prefer to focus on first.ng the mission
8:36 pm
and we talk about the five-year average or something else. after confusing that with the situation that we are in today. that was the uae energy --ister said hilma three suhail mazrouehi. you heard the uae energy minister saying that he did not think the global trade war was going to have that huge of an oil market.e is he right about that? >> yes and no. the impact on fundamentals can be overrated in the old market. you can't ignore the impact that the issue is having on sentiment . in general, we're finding the commodities space is really
8:37 pm
struggling to push higher amid these concerns. ultimately, if we do see economic growth impacted by ande trade subsidies tariffs, demand for all commodities can be impacted. that is where the rest of the complex will be heard. and certainly on the face of it, there is a market that we are unlikely to see a huge impact in the initial phase of this trade war. the firstjust in inning here of what looks to be a trade war unfolding. where do you think we will see the biggest impact? what area will be the most affected? >> industrial metals are very sensitive to economic growth, global economic growth.
8:38 pm
more so than the oil market. and certainly, it's always been a good proxy for global traders. i think the market like copper and steal will probably come under a fair bit of pressure as this conflict escalates. differento many facets to it, i suppose, that we are likely to save a lot of volatility because the market is really unsure about the impact. i'm sure that's been exacerbated by that real lack of data that we are getting or not getting from the u.s. administration in particular. >> we have a chart here. it is oil prices that remain quite elevated. can these diversions sustain
8:39 pm
itself? broadening the discussion around the geopolitical risks now, emanating in the market, initially coming through for , ite initial trade tariffs presents significant risks to the supply side. and certainly trump has been very aggressive. hawkish time the administration in general has created due to the appointments. we do represent a risk for oil markets. much tighterly a supply and demand balance than ofwere at the initial part the presidency. things have definitely changed.
8:40 pm
market, the supply-side issues are probably going to really support oil prices in the shorter term. given this opec deal, is an exit possible this year? daniel: i am still of the opinion that opec and saudi arabia in particular, they are talking towards tightening this market further than it really needs to. they are not going to allow this glut to reemerge. it magnifies obviously by the machinations we had in saudi arabia earlier this year. i think they will take a fairly pragmatic approach and wait for the day that the targets will start to reassess.
8:41 pm
my point of view, all indicators seem to suggest that this is going to go on longer. it will go on longer than the market had been expecting. yvonne: i want to ask about some of the hard-liners in the trump administration coming to the forefront. it of implication do you think that has for the commodities markets? daniel: absolutely. we pull back into line by some of the more conservative administrations in the past. this with the initial views of the deal. nextes suggest that the
8:42 pm
sign off for dates on the nuclear deal could be under reneged by the u.s.. troubledhe market is lead taking a bit too much in stride at the moment. i do suspect to the risks are significantly increased over the last few weeks. --does deserve a relatively oil prices a consequence of that. are we really talking about 1400 billion this year? i know you're long gold. daniel: i am still sticking with that called. the volatility has been relatively low and certainly, the events that we have seen come through have supported the oil prices and it has fallen pretty quickly. size thearting to see
8:43 pm
volatility is starting to remain elevated. that first rate hike out of the way, it died down as well. confident that we could see 1400 by into the year. danaiel hynes -- yvonne: heinz joining us there from sydney. they bought ays stake in a south korean conglomerate. we are live in seoul with more. this is bloomberg. ♪
8:44 pm
8:45 pm
yvonne: this is daybreak asia. i'm yvonne man in hong kong. betty: i'm betty liu in new york. shares rebounding close 6% higher after elon musk from to progress despite amiss in the first quarter production target. remy has been covering tesla all this week. in one moment, they are thinking bankruptcy in the next moment
8:46 pm
they are thinking, back on track. ramy: and if investors are looking to give elon musk a pass. up 6% inw with shares recouping $2.7 billion today, it is here they are doing it again. the question is whether they will do it in the second quarter wrapped though we just the first, it is interesting that investors are looking into the future. what tesla will or won't do. they said they won't have to raise capital or debt. investors like that. the are going to be hitting 5000 unit mark by end of the second quarter. these promises, we will see if they actually happen. the president was much more negative. a take a look at my first full-screen here. signed, sealed as delivered. is what they had. for 2500.recast was the delivery in terms of those units was 8180.
8:47 pm
the estimate was 8800. a clear miss there. and into the bloomberg terminal, i want to show you what this means in terms of the total units that were actually produced. this is in the library here. nearly 35,000 units and you see this is the most that they ever actually hit. this is coming up short because of the model three. remember there are still more negative than positive. they are convertible bonds. they are getting a little bit of a tick up. all of them are under the 100 sent mark. remember that we're still dealing with two fatal crashes as well as a recall of 123,000 model s's to contend with. yvonne: it is not just tesla, automakers released as well. ramy: this is the same story
8:48 pm
we've been talking about and it still continues today. it now seems like it is not going to stop. walking through the numbers here. first u.s. auto sales numbers. look at gm, ford, and fiat chrysler. fives an estimate of percent, fiat chrysler was the standout. even though it is 14%, that was a bigger be. they sold more vehicles than ford when you exclude the rental cars as well as the delivery of the sales of their new compass. analysts were expecting auto sales were going to come in at 16.8 million. on up and my bloomberg terminal wrote quick. 1183. it beat that 16.8 million mark. right here is the white line and i've contrasted this again with the price of gas.
8:49 pm
gas is still at a relative low. $2.7 per gallon under that for the past year or so. we see how the stocks have been doing for the big three. and for gm as well as ford, they were up the most in two months. chrysler was of the most in a year. taking a look very quickly at japan auto sales. for the most part, they were in the green. .hey were up and you can see that the only actual beat was honda. the lone miss here, the loan big miss by 3.7%. let's stick with the automakers now. and more than $1 billion stake in several hyundai motor entities. singer, the by paul changes still want a clear plan.
8:50 pm
they join us from seoul here this morning. talk a little bit more about this. ,espite this ownership overhaul there are criticisms of hyundai. what are they? asking to offer a roadmap that can benefit the companies and shareholders. clearly welcoming .he restructuring plan to cut the questions they are asking is how it will improve the corporate governance and cash flow. elliott is asking to sit down with hyundai to discuss these issues. yvonne: hyundai is facing a tough time as it is. one of the other issues they have been dealing with?
8:51 pm
>> i can say it was the worst year for hyundai. boycottedstomers because of the political tensions between south korea and china. plant had to temporarily shut down and resume operations. , they are seeing suffering from the sales slump of selective suvs and new models. thate: the first time they've done battle with samsung. how to the previous panels turnout? >> he came back again. there are fights between elliott and samsung in 2015 over the other between samsung and industries was a big blow to the entire empire at that time.
8:52 pm
it is all up there. and pecanwatermelons pie, urging them to vote for them. and they narrowly defeated we've opposed the merger on the grounds that the offer was too low for investors. elliott went back in 2016. the proposal to include corporate governance with a plan for creating a holding company. theme projected most of and outfitted them with a few of those proposals. you so much. the latest on hyundai. our bloomberg reporter in seoul. the forget our interactive function where you can watch us live and catch up on past interviews as well as dive into the securities for the bloomberg functions we talk about.
8:53 pm
become part of the conversation by sending us if the messages -- instant messages. this is bloomberg. ♪
8:54 pm
yvonne: this is daybreak asia, i'm betty liu in new york. yvonne: i'm yvonne man in hong kong. what are you watching? rishaad: we are looking at what
8:55 pm
is going on market wise and we will be along in a short while with jpmorgan asset. having a look at the impact of the tariffs and announcing that there is a lot of noise out there. going on with the tech side of things and it may revert back to fundamentals. yvonne: and that's what the u.s. is targeting when i come to some of these products as well. that is where they are targeting. keeping the tech theme going to some extent in that will be to k2. , and alsoinvestor uber shareholder. next, and that listing is rather smooth at the end of the day. car sales figures. we look at what is going on with tesla.
8:56 pm
things are a bit more extraterrestrial. >> and joining us as long about 45 minutes from now. that is dedication for elon musk, sweeping the factory floor. -- we see the cost be also lower here, turning the 200 down about .2%. a checking ahead on the asian futures of the markets that to open in just a few moments, you have got pretty mixed outlook there. the singapore market looking down about .6%. taiex futures pointing to a
8:57 pm
higher open. and also a slight loss over there in malaysia, yvonne. optimism isas much always on the overnight session. take a look at what we are seeing is a count down to the hong kong market. pretty much flat. the s&p futures, we see those in the red. it can be seen a little bit more of a reaction to some of these trade tensions. retaliation efforts coming through from china as well. certainly one to watch as we see rish keeping a sleeping bag in the studio as we learn more of this. [laughter] our market coverage continues with rish and heidi next. betty: stay tuned for bloomberg markets, this is bloomberg. ♪
8:58 pm
8:59 pm
9:00 pm
♪ releasingnited states the $15 billion china tariff list. to stage is set for a global trade war. china opposes the move and says they will hit back. asiatainty for investors, the civic stocks missed, traders weighing the implications. in hong kong, i am rishaad salamat. haidi: the boj confirms it is it fromg to discuss an ex stimulus, but remains a buyer for tokyo

21 Views

info Stream Only

Uploaded by TV Archive on