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tv   Bloomberg Daybreak Asia  Bloomberg  August 24, 2021 7:00pm-9:00pm EDT

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haidi: welcome to daybreak asia. sophie: we are counting down to asia's major market open. shery: our top stories this hour. asian stocks set to track u.s. gains, strong earnings, commodity rally boost confidence. president biden's $3.5 trillion
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budget blueprint passes the house. we dig into the detail of samsung's expansion plan, including 40,000 new hires. for risk on in the market, boosted by the fact we got the budget resolution after the senate, now we have the house. there was a lot of political maneuvering by nancy pelosi. we are setting up a vote before september 27 on the infrastructure package. seems to be blue skies for the time being when it comes to the congressional approval for the economic agenda. haidi: could it be blue skies for china tech stocks? we saw the recovery, bargain-hunting rally, driven by this key investor. cathie wood's investments, really strong results from
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jd.com, seemingly unscathed. cathie wood coming back into the market. we see this being a global theme, because the tech index in hong kong advancing 7% as well. we will continue to see if that has legs for a second day, given how immense the selloff had been. shery: it seems the retail rally has legs. we saw meme stocks rallying, 37 stocks bloomberg tracks, rallying the most since early june. gamestop, amc, even after hours we see gains for amc at 22%. surprising analysts at one point, because there is no clear reason why it this is happening, people are cautious because of jackson hole, but after friday's option expiration, retail traders are just jumping back
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and. haidi: when it comes to the delta variant, i remember a couple of months ago, goldman sachs was one of the first welcome employees back to the office. live music, food trucks. they are signaling a great deal of caution, requiring mass to be one. taking the playbooks from a number of big firms, new data out from the cdc suggesting that waning vaccine efficacy against delta as well. let's take a look at how this is adding up. great session overnight. how are we shaping up here? sophie: looks like markets -- looking delayed not derailed. could be looking at a third day of gains for asian stocks this wednesday, local in australia as
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well as china. petro china, tv player -- ed players due to report from the mainland. we have the record for u.s. stocks, wells fargo increasing its year and target for the s&p to 4825 on the earnings momentum lacey. overton taiwan, we have high valuations, slow tech spending cycle prompting morgan stanley to cut their target. divergent views there. when it comes to the risk on moves, the offshore not getting into bearish just yet, the aussie kiwi trading at april 2020 levels. the bank is sticking to its year and call for the aussie dollar, strong mining dividends. pulling up a chart, wti
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steady above $67, the best to gating this year for crude as well as brent. ubs seen brent above $75, the market undersupplied as industries continue to be drawn down. shery: let's turn to vonnie quinn with the first word headlines. vonnie: a new report from the cdc says efficacy of covid vaccines among front-line workers drops to 66% from 91% after the delta variant. researchers say two thirds reduction in infection underlines the continued benefits of vaccinations. the findings echo earlier evidence from israel suggesting covid jabs lose some potency over time. the u.s.'s top infectious disease expert says a third dose of the vaccine could lead to
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lasting levels of protection. anthony fauci told msnbc it is entirely conceivable that a third shot may allow for a prolonged period of intent -- protection. singapore's government says migrant workers who tested positive for the coronavirus at a dormitory in singapore were all fully vaccinated. paul 62 individuals were either a symptomatically had mild symptoms. they have been moved to a health care's facility for further treatment. rolling stones drummer charlie watts has died, aged 80. his drumming style as subtle with swing have been a member since 1963. earlier this month it was announced watts would miss the forthcoming tour. a statement from his publicist said he died surrounded by family.
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global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. haidi: the u.s. house has adopted a budget resolution, pushing forward a core component of president biden's economic agenda. our white house correspondent joins us. we had some intraparty disagreements to get here, but what happened? reporter: nancy pelosi secured an agreement to pass the president's budget blueprint, and that includes education, childcare. democrats also agreed to vote on a separate $550 billion infrastructure bill, and that touches roads, bridges, broadband. they agreed to do that by the end of september. shery: there are still a lot of
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challenges ahead. whether the plan or avoiding the government shutdown, the debt ceiling. what can we expect next? reporter: it is all in the details. the $3.5 trillion budget blueprint past today, lawmakers are going to need to fill in the details on what exactly will go into a final bill. the roads and bridges bill is parked in the house with a commitment to be passed by september 27. this is happening within the context of negotiations between progressives and moderates to decide what ends up in these final packages. that is what we are going to be watching. shery: there was political maneuvering, speaker pelosi trying to avoid a showdown. is this something we should expect? reporter: we should expect a
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look at what the details are to determine whether there will be that argument. there are progressives who want certain things in that package, and are withholding their vote for the other bill unless they get what they want. on the flipside, you have more moderate democrats arguing the opposite. speaker pelosi is going to have to walk the fine line in appealing to all members of her caucus, because she can't afford to lose more than a few votes at the end of the day. shery: the latest there arm everything -- on everything congress is doing right now. we have to talk about the geopolitical front, afghanistan. president biden has rebuffed calls to keep u.s. troops in afghanistan passed his august 31st deadline, saying the u.s. is complement -- confident it
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will complete evacuations by them. let's get the latest. there had already been growing tensions between the g7 when it came to afghanistan. is that what we saw this week? reporter: the president started his day with a virtual meeting with all g7 allies. there was a lot of pressure coming from european allies for the president to extend the deadline. the president did not budge on that. the only daylight we saw in decision-making was later in the day when he said he would ask the pentagon and state department to come up with some contingency planning for various reasons. it's clearly not his preferred choice. he is sticking with the end of august withdrawal. haidi: in the meantime, his vice president is continuing her trip in southeast asia, questions about criticism and anxiety from
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the exit of afghanistan. how has she been addressing this while delivering that message of wanting to get tough on china? reporter: i think one thing she is saying is one reason they are trying to get out of afghanistan is so they can focus more on national security priorities in asia, china. that is a message that is likely to resonate in the longer term. in the shorter-term, people in that part of the world, as well as the rest of the world, are surprised at what appears to be an enormous lack of planning for some of the chaos we have seen. haidi: we do have a big interview coming up in the next hour. a business council president gives us his biggest takeaways from kamala harris's trip to southeast asia.
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still ahead, bonds traders brace for jackson hole. a guest joins us to tell us how she is setting up for the big event. coming up next, the sec is said to demand all chinese companies listed in the u.s. disclose risks. we have the latest with that exclusive interview. this is bloomberg. ♪
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shery: a bloomberg exclusive. the sec will demand all chinese companies trading in the u.s. better informed investors about political and regulatory risks. ben bain spoke to the sec chair. how are we going to get this enhanced disclosure? ben: when we spoke to the sec chair, the message was while
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there has already been this pause, securities regulators in washington have imposed on chinese companies looking to raise new money in the united states, and ipo for example, that remains in place. in addition to that, the securities regulators want companies who are already trading in new york, some 250 or more to also increase the disclosures around political risks, regulatory risks and china, and also how the corporate structure exists. right now, many of the companies that trade in new york are actually shell companies that have a financial relationship with the operating company in china. the sec chair is contending that american investors are not aware of that. what he is saying is, the chinese operating companies and shell companies need to do more to make that relationship clear
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to u.s. investors, we are expecting from a we are today, that that is going to start to come out as we look into next year, when some of these companies file annual reports, additional shell filings come about. the sec is demanding more information. haidi: do we know what sort of consequences we are talking about? ben: that is the big question. we asked about that, we did not get a clear answer. what we did here from the sec chair is the agency has lots of tools it can use, and the sec, meanwhile, is already in this long-standing tit-for-tat and discussion and negotiations with chinese regulators, and the audit regulator here in washington, are also trying to get access to financial audits of chinese companies. there are repercussions that can come from that issue as well,
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and congress passed a law here in washington last year that basically says if chinese companies do not allow u.s. inspectors, they could be delisted from u.s. exchanges. over the next few years, we could see some serious consequences, if chinese companies do not start doing what the sec, and congress, and the trump administration, and now the biden administration are asking. haidi: ben bain with the latest from that interview. let's bring in our next guest, she says regulatory changes in china have been cut up regulations. joining us now from santa monica as our guest. when you take a look at the sec, do you feel like this is an element of catch up given we know there has been transparency issues with a number of these chinese companies, their balance sheets, for years now? guest: i think the sec --
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requiring entities listed in new york, it is a requirement just to treat these companies the same as american companies. the requirement for transparency is no more than a ask of american companies, and is a reasonable respect. from the chinese point of view, information regarding data they do not wish to disclose. we are at a point in time, or i think both the u.s. and china expect these companies -- for most institutional investors, that is accessible. that is not a market that is closed off. the only people left out in the cold, if you like, our retail investors. i would imagine over the next two and a half years, that the
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various financial institutions will figure out a way for retail investors to invest in an etf or something else. haidi: some of your ideas have to do with the market in asia, the benefit to decoupling. let's start off with japan. what is attractive about this market? guest: japan has always been an economy with a lot of terrific companies to invest in. at this point in time, it has become unpopular, so it is relatively cheap to other developed countries. if you look at p/e ratios, something like 15 overall, the europe is 18, the u.s. is 25. if you look at individual companies, we look at a number of attractive companies. anywhere from 4-8 that are perfectly good companies that
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fit the power requirements -- fit our requirements for good practices. japan is full of opportunities to find gems that fit our requirements. shery: i thought japan was months a contrarian call -- was once a contrarian call, yesterday we had a guest also like japan. does the fact japan is also cyclical factor in? that financial companies are also based? guest: japan is a country with terrible demographics. growth has been nonexistent for years. the way to invest in japan is to look for companies that are good businesses with room to grow, that you can buy with a margin of safety, run by people who are fair to minority shareholders. when you put those criteria around japan, you will find
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companies that are abroad, mostly. whether asia or all over the world. a good example is toyota. they have penetrated the auto market in europe more than before, because they are such incredibly efficient cars. there are a lot of opportunities for growth abroad, as well as some trends to mystically, as well as outsourcing. shery: it's also surprising for me how india has managed to become the biggest gain or among major markets, surpassing i think the gains in the topics -- in taiwan and korea as well. what is happening there? are we pass covid? guest: india is not past covid from a disease standpoint, but has managed to keep the economy
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going. selected lockdowns, continuing to produce its goods, have people back at work. the economy that has been rising rapidly since the shutdown is still growing nicely, with very little -- due to the delta variant. shery: tell us a little bit about south korea and taiwan. they are very exposed to the chip related outflows. are they going to come back? guest: taiwan and south korea are really key in the u.s.-china technology competition. they produce most of the chips in the world, needed by both the u.s. and china. essentially you have two countries that will continue to
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dominate, demand by the biggest economies in the world, they have companies that are run extremely well, taiwan semiconductors, samsung, they are fantastic companies. the problem of course is valuations are high, and when valuations are high, you have to look deep to find companies that are not so well covered, that trade at a margin of safety. without that, any dipped down in the market leaves you very vulnerable. 25 times pe is not a cheap valuation. haidi: what are you expecting from jackson hole? is it a goldilocks expectation, is there a risk the fed could be behind the curve? guest: that is the fear. there are signs inflation is in the u.s. and elsewhere, they
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have to deal with supply chains. the question in the u.s. is whether or not labor will come back into the workforce after the $300 extra per week. that starts september 2 i think. whether people return to the workforce, at that point, kids go back to school. wages are a big part of overall inflation in the u.s., that is where the sticking point i think will be. right now, we have supply chain issues, not just because of covid, but also there are not enough workers. it's harder to get things done. shery: we really appreciate your time, we love having you on. plenty more to come on daybreak: asia. this is bloomberg. ♪
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shery: here is a quick check of the latest headlines. citigroup is considering letting its biggest clients trade in bitcoin futures, sources tell us the bank is waiting for regulatory approval. in a statement, it's at its clients were more interested in the crypto space, but there were still questions. a chinese business is proposing a novel solution to security concerns as it seeks to go public in the u.s.. tim hortons china says it will create an independent entity with the sell purpose of safeguarding and protecting customer data. they want to go public through a stock merger. -- spac merger. one company pledged to donate all of its earnings toward the development of agriculture until
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it is given away a total of $1.5 billion. the company joins the likes of tencent and bytedance. coming up next, we will discuss cathie
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>> this is daybreak asia. i'm vonnie quinn with the first word headlines. president joe biden said the u.s. military is on pace to complete the evacuation of thousands of people in afghanistan by august 31. despite what he describes as a tenuous situation there. by an earlier rebuffed's g7 call to extend the deadline for troops to remain in the taliban -controlled nation. he also warned there is a serious risk of situation breakdown in the country and that the world will judge the taliban by their actions.
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u.s. vice president, kamala harris left singapore more than three hours late en route to vietnam. the state department blames the delay on an incident in hanoi. the agency has used that phrase to describe instances of so-called havana syndrome. the white house says the incident was not a confirmed case. new zealand's central bank decided not to raise interest rates last week because of communication challenges rather than economic risks. the assistant governor told bloomberg it would have been tough to explain a way i -- a rate hike on the country entered a covid locked down. he also told us policymakers considered raising the official cash rate by as much as .5%. the ftc is demanding that more than 250 chinese companies trading in the u.s. should inform investors about their political and regulatory risks. it's an expansion of a mandate first imposed the last month on china-based firms seeking u.s.
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ipos, and is the latest response to beijing's ongoing crackdown on private industry. the sec chair said he wants to see the disclosures and corporate annual reports. global news, 20 for hours a day on air and on bloomberg quick day, powered by more than 2700 journalists and analysts and more than 120 countries. i'm vonnie quinn, this is bloomberg. shery: arc investment management kathy wood is jumping back into tech stocks after dumping mainland shares earlier this year. we spoke with bloomberg's about she's why -- why she's more optimistic than pessimistic with china in the long run. >> we have been pulling out of china -- we started last november after the debacle around the aunt group -- ant group ipo in the banishment of jack ma. and we saw increasing signs that
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the government was going to get tough on companies. in companies which were more than unicorns. they had exploded onto the scene and they had become so powerful and had their leaders, that they almost seemed to be threatening the government. at least that seemed to be our take on the government's response. so we were a bit cautious, pulled away, and in fact, our flagship fund has moved out of most chinese stocks. i think we were out probably late april, late may, somewhere around there. it might have been a little bit later. you never know 100% of the time. i think the online education, really the nationalization was a real valuation killer for the market. so i think that the market is going to be under pressure from
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a valuation point of view for a long time now. that sort of thing was so unexpected, even from those of us who saw the government tightening its grip on the country. but what we have done, after this last bloodbath in the stocks, we did try and sort through, ok, which companies are doing things the government likes? a what we're are seeing is those catering to tier three cities, logistics, groceries, so you have seen us by jd.com, jd logistics is a big part of jd.com. i think they own 70% of it. so that has probably been our biggest purchase, as well as this for the same reason. if you look at what we were doing in those portfolios, we
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were really walking them out of other names that we think will continue to be in harm's way or under government pressure, like the alibaba was, for example. carol: which you have been selling, correct? cathie: yes. in terms -- carol: in terms of the recent crackdown, does it make you pessimistic or optimistic about investing in chinese stocks? you are a longer term investor, so what is the longer-term play? cathie: we do know that china wants to be number one in the world economically, certainly. one of the ways they want to do it is with innovation, with technology. they want to bring more of us back into the country. certainly the manufacturing side and semiconductors being one of the most important areas in which they are investing. i have watched them invest in
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semiconductors since the early 1990's. they brought in a lot of taiwan semiconductor talent and they have not been able to crack the code. shery: arc investment manager kathy wood speaking with carol massar. -- cathie wood speaking with carol massar. sophie: japan may see ¥1.4 trillion more, really dipping into reserves. we are waiting on a formal announcement on the emergency the eight pre-sectors. their futures are unchanged so far this session with traders looking to bond buying and a speech for the jake -- for the board member later this wednesday. nikkei futures opening to the upside after today gains for the benchmark. but it still stays -- stays below 28,000 points. japanese stocks are gaining more appeal with the topics said to out -- topix set to outpace the
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msci asia index. as you heard from dolphin investments, they are liking the attractive valuations in japan and looking for jams. but switching out the stock -- chart, it is indian stocks. major benchmarks. foreign funds have been piling while exiting taiwanese and korean stocks. we have seen the kospi tumble in august, as markets are set to impact the latest virus waves at some room for optimism, given that vaccinations are picking up. bloomberg economics as it may open the door for a rate hike in october. the decision on thursday is not looking clear. the calls are for a 50-50 bet when it comes to tightening. shery: samsung has unveiled a massive $205 billion expansion plan that includes hiring 40,000 people over three years. let's cross over to our asian tech reporter. we have heard from the past about samsung investing more in the r and d, especially in
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chipmaking and it's part of the broader outline. >> the group announced that it will spend more than $200 billion for businesses for 40,000 people over the next three years. it is 100,000,000,000,081 for south korea. but investment in ships and batteries. the big part of the spending will be focused on developing memory chip technology and building new plans for biologics. it's contract manufacturing of vaccines and gene therapy. samsung is expected to spend the money not over -- not only for chip expansion but talent acquisitions. >> how much russ remains when it comes to leadership for samsung? >> the announcement actually
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came out 10 days after the vice chairman was released from jail on peril. basically samsung was showing its commitment to the national economy and it was one of the major expectations from the government when he was granted peril earlier this month. i'd say, the immense influence of samsung to the economy is hard to neglect and it shows the repeating history between politicians. there is the economic situation. they are still attending a trial every week that's related to a merger between samsung, and is also facing another trial like over use of propofol. these risks remain on the leadership. shery: our asian tech reporter
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with the latest on samsung. more stories we are watching as we count down to the start of trade and soul in tokyo. the national assembly will be holding a session for various new bills including a carbon neutrality legislation that could strengthen the company's 2030 emission targets. the indian unit is set to launch a mass-market electric vehicle within the next few years. plus, the finance minister is holding his weekly meeting on the market. this as we continue to see surging prices affecting the economy as we head towards abbvie ok great decision. over in japan, mitsubishi is joining wall street rivals for junior bankers. the country's largest bank has find -- found recruiting new talent with the wage war we continue to see. nikkei is reporting that toyota is raising the price of still materia as the commodity surges.
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plus they are gunning for the title of top-selling auto parts supplier with a ¥1 trillion push for new deals. it's currently the world's number two player in the space. we will have more on that later. stay with us on daybreak asia. this is bloomberg.
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shery: the federal reserve chair jay powell announces a clear pan -- clear plan, even a date for bond purchase. he is ready to start taking steps soon. our global economics and policy editor kathleen hays is here with the latest. even bloomberg opinion is urging powell to do this. in his speech on friday. kathleen: they think he's should phase out the qe program, give us more news on tapir, and they don't expect a whole plan, but they say, please maybe say that you will start the taper soon, and by spring, as many other federal reserve officials said recently. they point out that, we don't have a shortage of demands, we need to buy bonds and get the economy going. the problem now is we have excess demand that's coming up against the constraints. and that's pushing up pricing you're pushing up inflation.
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they note that inflation is well above target. it's time for the fed to dow back stimulus. they know last year inflation was low. no one knew how big the inflation problem would be. i love how they put this. they say inflation is a risk, so the ventral bank must uncover its ability to tighten or loosen policy is the situation demands. it prohibits its freedom because the fed has led investors to believe that it will wind down gradually before it turns. touched on a lot of things here, but bottom line, they think that is definitely time for the fed to move. haidi: the pboc is criticizing the fed when it comes to the policy seen as risky, as it tries to decouple monetary policies from the u.s. what are we hearing? kathleen: there is a typical understated way that the chinese are putting out a message saying, we are worried about what you are doing and you may
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be creating risks for the rest of the world. they say right now it will be some of the biggest risks as they try to decouple their monetary policy from the fed and inflation is rising. the taper is coming in as bloomberg editorial is urging, there are potential problems. this is on top of the situation where they reopen the financial sector. there's a lot of foreign money that has gone in there. so what happens if something spurs capital outflows? that's what they don't want to see. they note that the u.s. faces the most severe inflation risk of any economy, and here's what they say that i think is so striking about what the message is that they are trying to get across. it's a normalization of major economies pick up. that could trigger a correction in financial markets and increase outflow pressures and currency depreciations and most emerging economies, leaving to higher risks for debt repayment and refinancing. so, you can see here, there is a
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sense of that there is a danger, the u.s. is poking to the rest of the world. i don't think the fed would see it in that dire of a fashion, but the pboc is concerned and they wanted to decoupled, but they have not yet, that's why they are at risk. shery: our global economics and policy editor there. we will actually have a little bit more on the fed moves. our next guest is saying she remains constructed on asian credit as it should be impacted less by the central bank tapering. joining us is the cohead of asia-pacific fixed income. great to have ufs. what are some of the risks going into jackson hole? >> it is macro and economic policy in the economy. but it is supposed to be more academic rather than discussing
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the mechanics of tapering. so he actually still believe it is more likely for fed to start communicating tapering towards the end of the year after another couple of months of data support. september is not a zero probability, but we believe november is more likely. more time in more information, more data support. higher confidence, but there means there is a risk of running behind the curve. shery: what do reactions from the fed due to china's markets? we see them having an impact on the chinese corporate debt sector. >> china is on a decoupling policy in terms of fed. we look at their recent communications by pboc, china is actually there to support more credit, particularly for certain sectors. but if you look at the china growth, it all makes sense, the
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china growth is slowing down. and there was the regulation crackdowns at the chinese government put out for the sectors over the past two months. there is a need for the pboc to support growth from a monetary perspective. haidi: does the crackdown create a better investor opportunity or in -- or environment for china? >> the speed and stringent seas of china's new regulations on various sectors may seem very surprising, but regulators underline concerns that are really unique to china. they are very similar's to regulators in u.s. and europe. for example, big tech companies are under the microscope everywhere because of your -- they're who you sides and control of customer data in creating financial risks.
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the difference between the governor response and the rest of the world is that the chinese system of governance allows it to act faster as being more forceful. it could surprise within communication. so the companies that we have been tracking for years, and if you look at the traditional sectors, like a property and financial institutions, they are actually under very stringent red ticket -- very stringent regulations. the companies that ignore the consequences. however, those companies that follow the governance warning an ally their practice the government's warning, they will have a more predictable regulatory market. turning into you can -- turning into utility companies with more stable cash flow. that's not necessarily a bad
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thing from a creditor investment perspective. haidi: we saw the bailouts, the state led bailout's getting very different reactions from moody's. in fact, they came up with completely divergent views. what does that tell you about how even ratings agencies are struggling to be able to view what regulators are doing? >> historically, there is a different methodology. in historically, this is a top-down mythology, the government entity, moody's applied for bottom-up, so you can look at the readings of the final ratings from both agencies are not really that different. regardless of the difference of the actions. the recent developments have confirmed our earlier view that it's important to financial institutions. in the restructurings that resulted in this is highly
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unlikely. so of course, there remains uncertainty on recapitalization, and the shareholding structural -- going forward. it does not really dilute the ability for the chinese government to support borrowing in times of need. in the recapitalization plan by the chinese soe is that it is a clear and strong signal that they would like to help them firmly and timely. haidi: always great to have ufs. the head of asia-pacific fixed income. coming up next, japan is looking over -- looking to overtake -- as the world's top auto parts supplier. we will tell you how they plan to do that next. this is bloomberg. ♪
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>> then so is looking to double revenue from its ev parts by 2025 as it tries to become the world's top car parts supplier. the japanese company plans to deploy around ¥1 trillion or $9 billion on m&a deals and share buybacks to help stoke growth. joining us now for the details is bloomberg japan transport reporter. how do they plan to overtake as
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the world tops auto parts supplier? >> right now denso is the world's second-largest automotive parts supplier and it is looking to gun for that top role. the way to do this is by digging deep into the electrification push. providing cars for -- parts for ev's. this has been a historic strength for them. they get half of their sales from toyota and has been making hybrid parts for toyota since the 1990's. the company thinks that this long experience it has with hybrid parts will give it in advantage now that there is growing demand for ev parts. their strength with electrification has gained awareness, especially over the past year. the shares in the company have risen over 70% with a lot of analysts expecting further growth in the electrification field from denso.
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it's looking to grow its revenue in this field by 2025 and doubled that figure by 2030. denso is looking to grow this strengthen the have indicated that it would put a lot of financial backing behind it. the cfo wants to spend around $1 trillion or about $9 billion within the next five to six years. half of that will go to shareholder return by back in another return will go to merger and acquisition in the shield of electrification. it's also looking to sell off a number of smaller businesses. it has gasoline related businesses and it is strengthening this push. haidi: japan's transport
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reporter. let's look at the stocks we are watching as we head into the open. sophie: we are keeping an eye on japanese easy players as local media is saying the government will extend purchases for ev's in the country. we are keeping an eye on steel stocks. businesses see their continued expense for iron ore futures and singapore. ten-day steel, today as we do see cargo and iron ore picking up when it comes to demand, which is seen the ongoing surge. shery: coming up, and on u.s. vice president, kamala harris southeast asia trip. we will hear from the business council president. the former advance at -- ambassador of vietnam. the market outlook with s gmc capital, founder and ceo. the open in sydney and tokyo are
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next. this is bloomberg. ♪
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shery: hello and welcome to daybreak asia i'm shery ahn in new york. sophie: i'm sophie kamaruddin in hong kong. haidi: i'm haidi stroud-watts in sydney, looking at the markets opening. asian stocks are set to track u.s. gains and strong earnings. the sec demands all chinese companies listed in the u.s. reveal more on investor risks.
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we will hear exclusively from gary. kathy would tells us she has rejoined the bargain hunters and chinese tech. shery: let's turn to sophie for all of the action. sophie: looking to see if asian stocks can sustain the momentum for the regional index since february. we are seeing upside move to the nikkei and the topix with this benchmark set for a period month higher when it comes to its outpacing of the emissivity -- msci index gauge. there is a little changes morning. looking at doj bond buying. i am also going to be gauging reaction to local media reporting that japan could add ¥1.4 trillion in virus release. keeping an eye on yen, we are seeing it again as it becomes the world top car part supplier. in south korea we are watching carbon neutrality, which may
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provide a boost to players. gaining nine tense of a percent at this as it reveals a $205 billion expansion plan that will see the hiring of 40,000 people over three years. the kospi looking to extend gains for a third session. in the korean won's firm -- firming up even more today. tweaking their forecast with an average of 1300 against the dollar from the initial call for 1100. checking on the asx 200. we are seeing slight gains at the start of cash trades. aussie dollar is trading near a one-week high along with the kiwi after they tracked the balancing commodity. we have iron ore futures extending at the rally in singapore here and brent is gaining ground above 71 bucks a barrel here. ubs says look beyond 75 on market tightness. we are also keeping an eye on reaction to earnings. in australia you had them reporting a wider annual net loss. we are keeping that eye on luminous shares, considering
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price target changes on the back of its market. global shipping disruption. we are learning that china's port is set to reopen the terminal from august 25. a lot of folks know what's going on with the global shipping market as container rates continue to search. haidi: particularly going into the key holiday season. we are watching after pay and buy now pay later. after pay failing to see a profit for the full year fiscal 2021. reporting that net loss of 156.3 million for that time. we are taking a look at that trading done by half of a percent in the wake of that square buy out to the tune of $29 billion. and don't miss our interview with the after pay co-ceo and cofounder who will be joining us at 20 minutes past 12 -- 12:00 in the afternoon sydney time. shery: let's bring in our next
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guest who has become increasingly cautious on global equities, but he recommends adding exposure to chinese stocks for the longer term. joining us from singapore is the founder and ceo of s gmc capital. great to have you with us. given the increasing pressure that we have seen from the u.s. sec when it comes to the enhanced disclosures, are you thinking more about chinese assets domestically are also here in the u.s. -- or also here in the u.s.? >> our preference would be the ones listed in asia. hong kong and china itself. as you would definitely take a little bit of political risks out of your investment. this being said, there are some opportunities in the u.s.. but our preference would be the ones listed in asia. shery: how do you hedge for the ongoing regulatory risk? >> obviously, first of all, whenever you enter into investments you have to do it with the long-term.
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we know the headline risks remains high-end political risk remains high. in the most could be a little bit bumpy as we have seen over the last few months. but over the long terms if you have three, two or four years, current valuations are attractive. if you want to hedge on the short-term, you can always protect yourself by buying on the relative index on the relative industry you are looking to gain exposure to and picking the stock winners. haidi: picking the stock winter -- winners might be shielded. jd.com said alibaba and tencent as a matter of less high-profile names. what is the strategy there? >> you always have to take a diversified approach. definitely some of those -- that continue demonstrating impressive growth year on year like tencent.
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those should form, but not only those, but the more international ones if you want, the one that global investors know as well. but definitely getting some exposure to some of the local players for more link with respect to domestic growth, and can really become domestic champions and the chinese growth over the next few years. definitely that does make sense. whether it's infrastructure or in financial, definitely do add and develop a diversified back when it comes to chinese exposure. haidi: when it comes to volatility concerns going to jackson hole, are their worries, and what could we hear from jay powell that will suit some of the concerns about the timing on the taper? >> the worries are definitely there because the market is a little bit scared that they could announce tapering. we do not think it will do that. obviously to soothe the markets,
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powell and the government can come out, being even more dovish than what is currently expected. with something that was dovish, but we also don't think it will start tapering now. we also think about what new zealand's approach will be. we say what will be houses of the covid impact growth. let's see if this could potentially derail the current growth we are seeing in terms of data. and it's only then, let's start talking about tapering and went to start. it will be seen as dovish from the market and would result on risk on for risk asset and some dollar depreciation. haidi: let's get you to vonnie quinn with the first word headlines. vonnie: thank you. president biden says the u.s. military is on pace to complete the evacuation of thousands of people in afghanistan by august 31.
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despite what he describes as a tenuous situation there. by earlier rebuffed the g7 call to extend the deadline for troops to remain in the taliban-controlled nation. he also warned there is a serious risk of a situation breakdown of the country. and that the world will judge the taliban by their actions. a new report from the cdc says efficacy of covid-19 vaccines among front-line workers dropped to 66% from 91% after the delta variant became dominant. but researchers say the sustained two thirds reduction in infection risks underlined the continued benefits of vaccination. the findings echo earlier evidence from israel and the u.k., suggesting covid jobs loose some potency over time. singapore's government says migrant workers who recently tested positive for the coronavirus and singapore were all fully vaccinated.
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all 62 individuals were asymptomatic or had mild symptoms. they remove to a health care facility for further treatment and care. global news, 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts and more than 120 countries. i'm vonnie quinn, this is bloomberg. shery: we speak to their current u.s. business council president about vice president, kamala harris trip to asia in the future of american diplomacy and the region. up next, the sec demands more transparency from the hundreds of chinese companies in the u.s. we will have more on that, next. this is bloomberg. this is bloomberg.
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haidi: let's get you to bloomberg exclusive. sec will demand that all chinese
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companies currently trading in the u.s. are informed and political and reglet tory risks. bloomberg spoke to the sec chair and what did he have to say? >> essentially, what we are seeing, we heard from the chair earlier today, was that the sec is likely to demand that all of the 250 plus companies, chinese companies that trade in the united states make additional disclosures about things like their corporate structures or the shell companies that they use to list in the united states and their interest with the companies in china as well as political and reglet tory list. this comes as the sec chair said late last month that there was essentially a pause being put in place on any new ipos from chinese companies until they also came ahead with similar disclosures. what we heard today was that was not just new companies in the
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united states, but those 250 plus companies that already trade here will also have to start disclosing more information, particularly as we start to look at annual ports next year, and some of the regular filings that they would have to file on here in washington. shery: do we have any idea of the timeline until when they need to make those disclosures, and have they been talking to these companies? >> we don't have a sense exactly when it's going to happen, but what we did come away with was that this is likely to start to have to be made clear for these types of issues like corporate structure, political and regulatory risks in the next round of annual filings. that could be sometime early next year. we would not get a set date. it's worth noting, this is all kind of happening. at the same time, there is also
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an ongoing feud with u.s. regulators and chinese regulators over the ability of u.s. inspectors to review financial audits of these chinese firms. this essentially is a long-standing dispute that dates back almost two decades. in congress and the united states passed a law last year saying that if these firms don't start allowing their u.s. inspectors to look at financial odds, they could be kicked off u.s. exchanges within three years. shery: covering the sec there. at the same time, chinese firms planning to list on american exchanges are slowly starting to tackle increasingly detailed queries from the sec. joining us now for the details is bloomberg equity capital markets reporter. what are chinese firms changing in their filings now? >> we can see that they are starting to respond to the
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disclosures that the sec is asking for. essentially, they are basically putting the details on the risks of the variable interest entities, which are the shell companies that they use to list in the u.s., they are putting those in the front page of the perspective. that's not what used to happen before. it used to be among the risks, but not on the front page. it's put very prominently there so investors can see and investors in response to the sec's demand. what they are also doing is putting them on the front page, reminders about the risks that they face, the risks that the shell company structure they have been using to list abroad faces, given china's move or promise to crack down on tightening the rules for overseas listings. and they are also warning about the deregulatory risks that are seen in china, warning that there has been lots of
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announcements, short notice, available notice affecting businesses from antitrust to ride hailing and it may affect the business. haidi: is this going to go anywhere in terms of getting back into the good books of the sec? >> it's hard to say given what the sec has said about asking the staff to take a pause in green lighting chinese ipos. and obviously, whilst they are addressing the demands of the sec over the additional disclosure, the political and regulatory risks of china remain. in the rules -- and what new rules of overseas listings will look like, we don't know yet, so there is still that uncertainty. these are obviously very small deals. most of them are large ones that
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are still working through the questions or deciding not to go ahead. so it's what we will see in a few weeks as these ipos move ahead. if that's essentially the q. haidi: our capital markets reporter there with the latest. kathy wood is jumping back into chinese tech stocks after dumping mainland shares earlier this year. would spoke with bloomberg's carol massar about why she is feeling more on the mistake and pessimistic when it comes to china in the long run. cathie: we had been pulling out of china. we started last november, actually, after the debacle around the ant group ipo, and really the banishment of jack ma. and we saw increasing signs that the government was going to get
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tough on companies. in companies that were more than unicorns. they had exploded onto the scene and they had become so powerful, as had their leaders, that they seem to be threatening the government. at least that seemed to be our take on the government's response. so we were cautious and pulled away. our flagship fund has moved out of most chinese stocks. i think we were out probably late april, late may, somewhere around there. it might have been somewhere around there. you never know 100% of the time. i think the online education, really nationalization their was a real valuation killer for the market. so i think that the market is going to be under pressure from a valuation point of view for a long time now.
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because that sort of thing was so unexpected, even from those of us who saw the government tightening its grip. but what we have done, we did after this last the bloodbath in the stocks, we did try and sort through, ok, which companies are doing things the government likes. and what we're seeing of those catering to tier three, tier four cities, logistics, groceries. you have seen it by jd.com, jd logistics. it's a big part of jd.com. i think they own 70% of it. so that's probably been our biggest purchase -- purchase. but if you were to look at what we were doing in those portfolios, we were really swapping them out of other names
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that we think are going to continue to be in harm's way, or certainly under government pressure, like the alibaba was, for example. carol: which you have been selling, correct? cathie: yes. carol: in terms of the recent crackdowns, does a longer term make you more pessimistic or optimistic about investing in chinese stocks? you are a longer-term investor, so what is the longer-term play? cathie: we do know that china wants to be number one in the world. and economically, certainly. one of the ways they want to do it is, with innovation, with technology, they want to bring more of it back into their country. certainly the manufacturing side at semiconductors being the most important areas in which you are investing. i have watched them invest in semiconductors since the early 1990's. where they brought in a lot of
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timeline semiconductor talent. and they just have not been able to crack the code. shery: that was cathie wood speaking to bloomberg's carol massar. we do have breaking news at the moment. signing a deal to sell its controlling stake, selling its 42.9% stake for 1.5 trillion one to get acquisition holdings according to regulatory filings. the total deal is worth about 1.7 -- 1.7 trillion after affordable bonds. this will be fully completed in january of next year. coming up, beijing pushes a more optimistic outlook for afghanistan as the european leaders expressed concerns about the withdrawal deadline at the end of the month. we will take a look at what's at stake for china and afghanistan.
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this is bloomberg. ♪
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>> we all agreed that it is our moral duty to help the afghan people and to provide as much as possible support as conditions allow. >> we remain committed to those values, and we remain committed to afghanistan. >> let's be clear, let's not allow the creation of the new markets for smugglers and human traffickers who are determined to keep the control and the eu protected. the number 1 -- >> the number one condition we are persisting
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upon his safe passage beyond the 31st. shery: leaders speaking about the situation. beijing has been pushing a more optimistic outlook for this under taliban rule. this as afghanistan has emerged as a key source of some of the most crucial commodities of the 21st century. we are joined now with the latest. i know it is still early days, but do we have any ideas at this point what kind of afghan economy is likely to emerge? >> the starting point is one of total shop for the economy. pharmacies are running out of jobs. we know that it is -- and imf has frozen afghanistan's assets. there is a downward spiral -- spiral effect happening. the view is, that whatever government or political system will have to adhere to
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international obligations, especially on human rights, and especially when it comes to women. that will be critical to international recognition. and if you do get recognition, they may then get some access to foreign capital. that is the optimistic scenario that some people are putting out there. but the starting point is a steep one. haidi: when it comes to china's attractions to afghanistan, is it all about belt and road? what's in it for them? >> it has to be reserved. they have minerals around -- worth around $1 trillion. we are in a very different economy from when the taliban last rule. it is powered by smartphones and electric vehicles. there is demand for lithium and there is copper there as well. we had a piece in the new york times by a kernel of the weekend specifically highlighting china's interest in the
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minerals. we also had commentary in a safe place in china making the point that it is impressive and investing. no doubt china is keep an eye on resources. they do guide up the ground and they really go in there and deal with the ministration of the kind of regime that the taliban appears it might be. shery: the world bank now saying that it has paused disbursements and afghanistan. what will they need to do to secure foreign cash? >> it is all about human rights and adhering to international obligation and it's especially about human right -- women's rights. they may get some access. but others say the starting point is a steep one. shery: our chief asia economic correspondent there with us with everything we need to know about the afghan economy. we will get a preview in terms of the fed chair jay powell.
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as we count down to their virtual jackson hole event this week. this is bloomberg. ♪ and there you have it- woah. wireless on the most reliable network nationwide. wow. -big deal! ...we get unlimited for just 30 bucks. sweet, i get that too and mine has 5g included. that's cool, but ours save us serious clam-aroonies. relax people, my wireless is crushing it. that's because you all have xfinity mobile with your internet. it's wireless so good, it keeps one upping itself. so many people are overweight now and asking themselves, "why can't i lose weight?" for most, the reason is insulin resistance, and they don't even know they have it. conventional starvation diets don't address insulin resistance. that's why they don't work. now there's golo. golo helps with insulin resistance,
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>> this is daybreak, i'm vonnie quinn with the first word headlines. the sec is demanding more than 250 chinese companies trading in the u.s. to inform investors about their political and reglet tory risks. it's an expansion of a mandates first some post last month on china-based firm seeking u.s. ipos. and is the latest response to beijing's ongoing clampdown on private industries. as the chair says, he wants to see the disclosures and corporate annual reports.
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u.s. vice president, harris left singapore more than three hours late on route to vietnam. the state department blamed the delay on what it called an anonymous health incident in hanoi. the agency has used that phrase to describe instances of so-called havana syndrome. white house said the incident in hanoi was not a confirmed case. house lawmakers voted to 28-to 12 to adopt the 3.5 trillion dollar economic blueprint. nancy pelosi and moderate democrats struck a deal to the unite the divided party. the plan now moves through a reconciliation process that the house and senate will vote on. a final vote on a separate $550 billion infrastructure bill will follow by september 27. new zealand central bank decided not to raise interest rates last week because the communication challenges rather than economic risks. the assistant governor told bloomberg it would have been tough to explain a rate hike on
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the day the country entered a covid lockdown. he also told us policymakers considered raising the official cash rate by as much as half a percentage point. global news, 24 hours a day, on air and by bloomberg quicktake, powered by 2700 journalists and analysts and more than 120 countries. this is bloomberg. shery: whether or not jay powell announces a clear plan, even a date for the start of bond purchase tapering, the drum is beating louder for him to clarify that he's ready to start taking steps soon. kathleen hays is here with the latest. the bloomberg opinion is urging powell to do this in his speech on friday at jackson hole. why? kathleen: they feel it's time. it's interesting to me, we have seen many investors and colonists saying that, they have said everything they will say. after the july 28 meeting. bloomberg editorial is saying no, he can do more. for example, he can say he wants
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the taper to start soon and have it over by spring. any other fed officials have said that, including one of the most recent arrivals to the board of governors in washington. and what bloomberg opinion is pointing out is that, we are in a different situation now. we don't have a lack of demand where we have to buy bonds and keep rates low to make sure the economy recovers, we have got excess demand now. we have supply-side constraints and inflation far above target. in fact, states say it's past time for the fed to start dialing back the stimulus. they point out that, let me read this to you, inflation is a risk so the central bank must untie its hands, recover its ability to tighten or loosen policy as the situation demands. the program inhibits its freedom because the fed is what investors believe will wind down its buying down gradually before it turns, if necessary, to raising rates. it's a necessary step with
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economies recovering, that the bloomberg editorial team is saying, do it now, chair powell. haidi: the reappointment is in focus, there has been a lot of scrutiny over his relationship with congress. kathleen: absolutely. i love the title of our bloomberg legal team. it's positioning him to keep jobs. jay powell went to washington and became fed chair, knowing he had to do this. he has held at least 350 meetings with members of congress from february 28 through june of this year. of course, it gave him a boost that janet yellen, a democrat, she was fed chair, but she certainly a democrat now, she told bidens seeing advisory she supports powell's reappointment, and we know that he has gotten a lot of support in congress, but there is key anti-powell people like elizabeth warren, shery
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brown, powerful democratic summit it -- senators who think he has not been tough enough on banks. but it is very important to have worn out those carpets on capitol hill in order to make friends and get support and show that he is listening to congress. haidi: our global economics and policy editor. the cio of one of the biggest u.s. pension funds does not expect much news out of jackson hole. he spoke earlier with christopher ellman who runs the 280 $3 billion california state retirement system. >> i think this market, it's priced to perfection. if i look outside the window, life is not perfection. my team just started getting a little nervous about this equity market in the last couple of weeks. it does not mean we are going to be underweight, but we certainly won't be overweight until we go into the fall, especially going into jackson hole on friday.
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>> let's talk about jackson hole this weekend. the expectation, to put it mildly, seem to be relatively low. the idea is they might not say anything, they shouldn't say anything and maybe the market is putting up their hopes too much on something that could turn out to be a nonevent. >> i get the feeling they will be parsing words, vowels and nouns because the market is not expecting anything, which is always a bit dangerous because something could happen. but i just don't expect it. the data is not helpful at this point. the virus is continuing to spread, they say and powell says inflation is transient. we are still seeing sticky signs of inflation, but that does not mean they will jump in and make any kind of a statement. i had statements at the start of the week that were more indicate of of what they might say and he did not say what they might say. >> you mentioned transient inflation. i am curious what the data is
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showing and how you shift the long-term portfolio in anticipation or reaction to some of the transient or not inflationary data points? >> tough question. we have got in inflation sensitive asset class, but it's only going to be about -- right now it's only 4% of our portfolio, growing to 7%, which is not enough to protect against inflation if it comes back. i feel inflation. i know cpi does not measure it, but i'm feeling it. i can't disagree with jay powell, he is the man. if he says it will be transient. we are seeing prices come down on raw materials. we are having a steady 2%-3% inflation rate. you guys reported on housing prices and rents going up constantly. shery: the chief investment officer speaking with bloomberg's romaine bostick and taylor riggs. we are seeing broad -- across
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equity markets. let's see what's moving with those. sophie: tokyo has energy stocks among the biggest of best performers so far, tracking what we have seen in oil with prices looking steady for brent and wti. ubs saying brent could move back above 75 bucks a barrel. we are seeing gains ease 40 minutes into the session. they are losing ground after they signed a deal to sell its controlling stake. over in sydney we are seeing gains of 4/10 of a percent with tech and minors leaving the event. stock movers in sydney, we want to highlight what's going on with after pay, shares are under pressure. focuses on the growth, the higher growth loss rates, which stepped up in the second half and zipped losing ground as well. after reporting a jump in annual losses as the ramp up of
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investments in global expansion. and it is slipping. that is the biggest jump on its guidance he amid the recovery we see in container volumes. switching off the board for movers in tokyo. nissan still jumping on the report that toyota is raising steel prices and iron ore futures are continuing their event. check out mazda shares gaining 2% in tokyo. this is the carmaker head -- and the carmaker has extended its output at two factories in japan through friday. it is unclear as to when the delayed parts shipment may arrive from china. with that, pulling up the terminal, global shipping disruptions have captured attention as the kospi transport of goods has surged. there may be some release with the port set to reopen. a shut terminal from august 26. using the function here,
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activity has already picked up, with ships starting to dock at the port after a two-week shutdown. haidi: we will be joined by the former u.s. ambassador to vietnam in the former business council president. discussing the progress made by the vice president, kamala harris trip to asia in the future of america's diplomacy in this part of the world. this is bloomberg. ♪
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haidi: kamala harris continues her asia trip, arriving in's vietnam after her delayed departure. that was due to concerns about a health incident. so far on this trip she has emphasized the u.s. commitment to the region. our next guest says her trip is building on the administration's message to the world that the u.s. is back. joining us now is the president and ceo of the business council, also a former u.s. business ambassador to vietnam. how complicated is the agenda? in the recommitment of the u.s. to asia, all of this is happening amidst two as been a highly criticized and very messy exit from afghanistan? >> i think with the administration is showing that they can walk and chew gum at the same time.
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yes, there is a crisis that has come from what they are dealing with, but they are also looking at opportunities for the future. in the places where kamala harris is traveling are real opportunities for the united states. haidi: the pragmatic relationship between the u.s. and singapore has been held up as a model. is it possible to replicate that in other countries, and how well is that message of building the alliance against rising china going? >> it is punches above its weight in the region. in the kind of arrangements that have been made between the united states and singapore on the strip suggest what is possible is an agreement i see on your screen and an agreement on climate change. there is one on supply chains. there is a partnership for growth and innovation. kamala harris announced america's willingness to host the asia-pacific economic cooperation forum in 2023.
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that is a really good way to once again drive the policy agenda, including on climate, supply chains, and digital trade. so singapore is a really good start to her trip. shery: what are businesses telling you about what they want to see this year in terms of the u.s./afghan relationship? >> they are asking us to listen to what the afghan nations want. they want to recover from covid, and then they want to move beyond emergency response to a more extended recovery. that means opening back up. the administration has been great on providing emergency response. 23 million doses of covid vaccines going to the southeast asia region, and then the u.s. business community has been stepping up and providing oxygen, providing diagnostic testing, and equivalent for home
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health kits to help people when they are stuck at home. but the real focus will be what do we do after this. that's why these discussions about supply chains, about infrastructure, about additional economy, and then long-term collaboration on health and climate change. that's why these discussions are critical, and it's great that she is carrying out these discussions at this time. shery: what difference has the change in u.s. administration from president trump to president biden made for businesses having relationships between the u.s. and afghan nations? does that affect businesses? >> businesses are going pretty well in most sectors. it continues to do well in this administration. southeast asia is full with opportunities. there are 662 million people. a gdp of 3.2 trillion. it is the fastest-growing
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digital economy in the world. 400 million people already online and many more coming on each day. so u.s. businesses and other businesses from other parts of the world have huge opportunities for growth. i am really glad that this visit is not just focused on security, but security is about more than just ships and planes, it's also about ties between nations and i think what the vice president is doing is cementing those ties in multiple areas on the two stops of her trip. haidi: when it comes to economic ties, it was a bilateral approach taken with the previous ministration, things have not changed much when it comes to u.s.-china trade. there is no suggestion we will see a re-acceleration of the u.s. becoming involved again in the tpp, but is there hope that we could see more multilateralism when it comes to trade agreements? >> i think there is hope.
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it won't happen instantly, but one area where the ministration could take a proactive step and have a more proactive trade agenda is in the area of the digital economy. there are so many opportunities and they are great models, including singapore's arrangements with chile, new zealand and australia. these are models to be emulated. even the chapters of what used to be tpp, that deal with the digital economy are terrific. the u.s.-canada-mexico agreement is a great model for what might be possible in the digital realm. since that is an area of such focus, especially in the time after covid went small and large businesses alike are dependent on the internet, that is a real opportunity. and i think it could happen pretty fast if the ministration decided to pursue it. shery: also in focus, vietnam's currency valuation.
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without be a hindrance to enhancing relations? >> i don't think so, i think that was set aside before this visit and then you look at the great success of lloyd austin's visit to vietnam. i think both countries are very forward-looking when it comes to vietnam. look, the last time a sitting u.s. president went to vietnam was lyndon johnson in 1962. here we have an asian american vice president going to this country where we have shown that reconciliation between old enemies is possible. you can go from being adversaries to being friends. there are a lot of great lessons for the vietnam part of the trip. shery: ambassador, thank you for joining us today, president and ceo of u.s. aussie on business council. tim hortons chinese business has a creative solution to address beijing's data security concerns. we will get you the d sales --
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details. this is bloomberg. ♪
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shery: here's a quick check of the latest business flash headlines. goldman sachs is requiring employees to wear masks and prove they have been vaccinated against covid-19 to enter its u.s. offices. the mask mandate starts on
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wednesday and people who are not fully vaccinated will have to work from home. all six u.s. banking giants have imposed measures to require employees to get shots or don masks inside buildings. mitsubishi ufj is joining its rivals and increasing pay for junior bankers in the u.s. competition for entry-level workers heats up your japan's biggest banks as pay hikes across the investment banking industry are making a harder to recruit new staff. several wall street banks raised entry-level pay after analysts complained about ruthless working hours. citigroup is considering letting its biggest clients trade in bitcoin futures. sources tell us the bank is waiting for regulatory approval to begin trading. in a statement they said their clients were more interested in the crypto space, but that there were still questions among regulatory frameworks. we are heading to the start of
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trade over and china. let's go to sophie for what stocks to watch. sophie: we have a busy earnings calendar from china. results are very much on the radar. the revenue group has been rising for the smartphone maker amid the rollout of 5g. and as huawei faces headwinds. in june we saw the smartphone shells top samsung. pulling up the next chart, i want to highlight -- that reported its first ever net profit since going public and the e-commerce company said it will donate it all to the support of china farmers. they plan to give away earnings until those donations reach $1.5 billion. this as a government pushes for common prosperity. haidi: the chinese business of canadian coffee shop chain is important in proposing a novel solution to beijing's data concerns. this as they are going public in the u.s. they will create an independent
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entity with the sole purpose of safeguarding and protecting customer data. joining us now with the details is our bloomberg deals editor david morris. so what is this strategy that tim hortons china is using? >> basically, they are seeking the data that is in the chinese unit and separating it into a different company in order to address the regulators concern. the chinese regulators have been very worried about companies going public overseas that have more than one million users data. so they have issued draft statements about how they want to regulate it. tim's is making a separate unit that will just have the data and it will be a nonprofit and it will not be owned by tim hortons china itself. shery: what does it need to be a separate unit? >> i think the idea is that it's a signal to the authorities that the data will be kept separate
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from the listed units. so the u.s. shareholders won't have any particular ownership claim on it. it will be jointly owned by a chinese synonym in china. it's not clear with the other owners will be, but it will be subject to regulations. the data will not leave the country and it will be done through contractual regulations. so it will just have a contract relationship with the unit, they will have control over the data. >> does this mean it will be a workaround around for other companies? >> it's not really clear, it depends on what the chinese regulators say. also become tim hortons china is going public via spac merger, so it doesn't touch specifically on what the draft regulations are. there are more concerned about companies going public in china -- sorry, and the u.s. in the conventional way. so it seems like a
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well-thought-out structure, and it seems like a lot of things that companies will look at and take seriously as a possible model. shery: our bloomberg deals editor. as we continue to see that regulatory upheaval in china, the markets have you looking for a place to put your money. it seems that india is a good alternative. so we continue to see this rally, not only in equities, but money going into d.c.'s in ipo's. money raised in ipo's this year if has reached a $.8 billion, surpassing the total for the past three years, and it's only august. so when you see chinese investments at the lowest in over a year, it's a whole different story for india. haidi: it's really different asset classes as well when it comes to the ipo's, when it comes to indian equities. the asians best performers out of all of the major markets. they are shrugging off what has been one of the world's worst covert outbreaks. those are ravaging the health
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care system in the population there. but investors are bullish when it comes to indian equities. they are ensuring the likes of korea and taiwan, despite the semiconductor story, to put money into india. so it's another way that we are looking at the fact that maybe there is a little pullback after seeing so much money though and as a result of the ships narrative. shery: as we see those chip related outlooks from taiwan and south korea, look at futures trading. taiwanese stocks in the previous session now ending at 16,818 level. we are seeing a little bit of upside at the moment. this as u.s. futures are muted at the moment after we saw another record high for wall street. strong earnings and rallying commodity prices helping the u.s. market. chinese a 50 futures lack of direction, but we are seeing the yuan at that 647 level. coming up, we get more of the market outlook with jackson hole
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with nancy dowd and amber hill capital director of asset management. that's it from daybreak asia, markets coverage continues as we look at to the start of trade and hong kong, shanghai and shenzhen. bloomberg markets china open is next. this is bloomberg. ♪
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♪ anchor: none :00 a.m. in beijing and shanghai. welcome to the china open. co-anchor: i'm david and grace. counting down to the open of trades on the chinese mainland and hong kong. the bulls are back in the china shop. kathy would. anchor: hiding disclosures for the chinese companies and demands more information o

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