♪ haidi: it is 9:00 a.m. in hong kong. i am haidi lun. rishaad: i am rishaad salamat. this is "bloomberg markets: asia". ♪ hit fora $5 billion samsung. rishaad: the thailand prime minister calls for calm. haidi: sluggish global demand.

rishaad: the latest u.s. data, inflation numbers and how it will influence the fed. haidi: we are watching assets and thailand. sees interesting we did weakness in the currency. rishaad: that story tells it all. on a bit of a tear at the moment. we did have equities holding up as well. we will give you reaction when the markets open. rishaad: that is 11:00 hong kong time. 30 minutes from the open in hong kong and china appeare. let's have a look at what is going on. david: we are watching singapore

carefully on the back of this disappointing gdp number. this is what we have seen in the last 15 minutes or so, more than a decent bid for the thailand currency. we are still very near the four-month low, but you have to put this into context. it has been down for a days. eight days. just under 36 here. we were hovering around 35.40. this is where we are at the moment. have a look at the year today chart. there is your weakness, eight straight days. together, itthing as if we are back to square one. we are counting down to the open in about two hours from now. a lot can happen between now and

then in the overall market. the thailand etf gained 2% overnight. have a look at the broader picture across asia. , no cleared direction, unsurprising given that we can lead from wall street. weak lead from wall did fall over all, but they provide a floor for the market. singapore, that is much as a reaction as were going to get. the economy contracted the most in four years. a horrible set of gdp numbers. we will see if the inflation data out of china due out in 30 minutes or an hour, if that jolts us back into action. what were watching out for is

are we getting more signs of activity or a slowdown. horrible set off a of trade numbers yesterday. mind.of things to keep in overall, markets not really doing anything. 27 minutes before we get underway in hong kong and shanghai. haidi: let's get to first word news. hyundai recalling 350,000 civic sedans in the u.s. to deal with a problem in the electric parking brake. faulty software in the control unit may prevent application of the break after the ignition is turned off. the work will be carried out free of charge and no accidents or injuries have been reported. informedll be next month. billion investing $25

over the next five years into a new tech fund. the fund would invest money from its parent company and some partners. investmentys the fund of saudi arabia may contribute as much as $45 billion. the overall size could reach $100 billion. japan's fast retailing has reported its lowest net income $464ight years with million in full-year profits. theresults prompted chairman to slash the company's revenue goals by 40%. hasclothing retailer struggled with weak demand at home and the impact of the stronger yen. weibo close to overtaking twitter. they could soon take the lead due to a lack of domestic competition. more thans slumped

20% this year against rivals like facebook and snapchat. weibo shares have almost tripled. most international social networks are blocked in china. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. haidi: thanks. rishaad: were looking at the cost of the samsung note 7 crisis. of $3s it will see a hit billion in its operating profit into the first quarter of next year. rosalind: the hits just keep on coming. ,he current tally of the damage $5.3 billion. , and that willy hit on current and next quarter operating profit, and $2.3 billion on its previous quarter. numbers stem from the drop in revenue.

it is in line with analyst estimates. samsung said it will boost the sales of other devices. it is also going to have to boost its other lines, semiconductors. today, it reported it will release the next model in february, a month earlier than planned. are so many other lines of business which give a lot of confidence. do have a belief in this company. shery: despite all the things that have happened since the 40 buysthere are still on samsung. i have a chart that shows you analyst scores for samsung. perfect scoreclu

in 2011 and have consistently scored above apple except for a the firstfter smartphone was released in 2009. onlyarket value gains is half of apple. number ofdid see a key investors adding to their position in samsung yesterday after the worst rout since 2012. there is a lot of conviction in the company despite the ongoing crisis. thank you so much for that. ofhaad: we have this month official mourning beginning in thailand after the death of the king. the world's longest-serving , where died in bangkok he had been treated for various ailments over two years. haidi: large crowds have gathered outside.

we are at the hospital. what effect are you seeing on business? >> we know that it will open at 10:00 local time. banks are also operational. any have yet to receive instructions from the government to shut operations. take a look at the baht. , recoveringy rising the losses in the last eight sessions. it has been gaining, and also the s&p showing signs it will recover as well. the etf traded in new york rising, showing positive indicators as well. we know there has been apprehension in the market. economists have indicated

likewise, appealing for stability in the market. take a listen. >> please do not damage our credibility and do not short sell. maintain our finances and commerce. do not fall prey to people who are trying to profit from this. question right now is whether gains are sustainable going forward. what happens next for the country? the transition is the important part. so far, indications are it will be a peaceful transition. we heard from the prime minister yesterday that the crown prince will be the next monarch. does not want this to happen immediately. he wants a time of mourning to mourn the loss of his father. the heir apparent, 64

years old, spent a lot of time overseas, particularly in germany. the official proclamation will happen later on. wherere at the hospital more and more people are coming together to pay tribune, to pray -- pay tribute, to pray for the king. thank you very much indeed. people scenes of actually upset and pouring their hearts out. haidi: still ahead, overly optimistic, whether fast retailing has been forced to scrap its ambitious sales targets. rishaad: the thailand king's death and its effect on the markets and beyond. ♪

haidi: 9:13 a.m. and singapore.

pretty flat on the straight times index. we had that ugly miss on third-quarter gdp. take a look at how we are tracking elsewhere around the region. well,f looking flat as slightly stronger aussie dollar. down .1 percent, slightly weaker yen not helping sentiment. south korean shares up by .5%. waiting for china inflation data after trade numbers missed the mark yesterday. rishaad: let's have a quick check of the latest business flash headlines. implementing a companywide hiring freeze as part of the ceos effort to cut costs and shore up investor confidence. that hiring is to be put on hold immediately. lost half of has

its market value this year. justice department demand for $14 billion over faulty securities. haidi: the push to sell more restaurants to franchisee will at $113 million to pretax expenses, $.12 a share after taxes. mcdonald's aims to sell 4000 outlets to independent owners by the end of 2018, hoping that will help to reduce costs by $500 million. rishaad: taco bell making a move into china, saying it will adjust its menu to meet local terrorists -- local tastes. yum could be a test for brands, planning to spin off as chinese operations. the restaurant is making an overseas push, predicting a could make $15 billion in sales by 2022. markets thethai

focus ahead of the open following the death of king bhumibol adulyadej. a chief let's get to global equity strategy -- strategies. the countryrop for is good. reserves, lowe inflation, very low foreign debt, so any sort of possible short-term outflows i think could be easily managed by the authorities. again, in that sense, i don't think there is any panic in terms of -- rishaad: it removes this uncertainty unfortunately good does, ine extent it reality the changes to the constitution in august this year by the military during the referendum has sort of given the backdrop that the establishment

of running thert show anyway, so i don't think there will be too much dramatic change to policies or a different direction that will transpire over the next few months. sounds like you have a lot of conviction in the fundamentals of the economy going forward. d.c. anything in the short-term? >> it could also be some weekday tip. i'm sure things like tourist arrivals will be affected. it will also be a knock on effect from generally industry slowing down with the number of holidays and so forth for urning, so you may get a knock in that respect. i don't think it will make any adjustments in direct foreign investment. and has alwaysle been export led to, very strong balance sheet since the asian crisis in 1998. and welltable

consuming economy. we get the latest read on china inflation. we got that ppi number, showing contraction for 49 months. we are seeing a big improvement in that, not so negative. is this a sign that china is dealing with its problems of overcapacity and the inventory overhang? >> i think it is not easy to work out how much capacity restrictions have affected the ppi number, but certainly the big drops in commodity prices that we saw and the last 18 months, that has helped to improve the ppi number. been thatthing has generally pricing power in china has remained stable. very good news for the

authorities, because china actually needed some inflation. rishaad: does it make you more attracted towards chinese equities? conditions are quite lose. we have been recommending chinese equities and think the authorities have done a backdoor qe and related the economy and the balance sheets of a lot of the state owned and state run companies have then reflate it and are showing dramatic improvements. haidi: just getting to the fixing. strengthening the most in september. little bit stronger today, but still that currency is close to those year lows, falling to a six-year low a few days ago. when you look at the massive amount of fiscal stimulus put through, is it a scenario that continues to export deflation? >> the since of exporting deflation, i think that will be

reflected in the year on your change of headline prices in china. i think authorities will let the renminbi fall. that needs to be adjusted through the exchange rate. a year ago, everyone was worried about a sharp devaluation. what has transpired has been modest, but done over one year rather than 5-6 days. haidi: we talk about china, a lot of people saying given the stability and data that we could tightening, but is the new normal a slow, steady grind. it will not be a hard landing or a pickup into double-digit growth either. >> it might actually weaken over the next 12 months. what you found now is that the corporate has saved all of the

stimulus, so it has not gone back and than any national service. the multiplier effects from this is not going to lead to any big dramatic jump in gdp 12-18 months down the road, so trend line growth may still be falling. there has been a significant change in behavior and china. nobody knows what is the endgame. rishaad: that's all we have time for. thank you very much. jeffries --rom the from jeffries. new tech fundk's is looking to spend. we will take a look at where it is putting its billions, next. this is bloomberg. ♪

this is "bloomberg markets: asia".

i am haidi lun. this is how we are setting up. hong kong futures indicating up by .8%, hang seng pretrade up .4%, disappointing chinese trade numbers coming for yesterday. were looking ahead to chinese inflation ppi and cpi to give us an indication of whether price pressures are building and the economy. we are focusing on the thai baht . it is on a tear. this is the second day of gains following eight days of declines coming 12ai currency, hours after it was announced that the king had passed away. some certainty it feels returning to the thai market, equities gaining alongside the currency. given the set backs we have had for the currency for thai assets, that could be a good entry point. it will softbank says

form a new plan to invest as much as $100 billion in the global tech industry over the next five years. it says saudi arabia may put in almost double the 25 million they will be contributing. three months after that softbank massive arm acquisition. >> that's right. backcquisition set softbank $32 billion. etis is by far the biggest b he has made in his entire career. with this new fund, it would make sense if the investments aligned with the wager on arm, the internet of things in the future of internet connected devices. what until is for pcs, this is what arm is for mobile devices and embedded computers.

as its core, softbank would pursue investment in the rest of the iot echo system, sensors, a electronic components, software, artificial intelligence applications. bank has said investments will go into technology companies, but no details available. rishaad: it will cost more than an arm and a leg, softbank more than $100 billion in debt or there have to be some investors concerned. >> if the arm acquisition has taught investors anything, they should always be concerned. no one expected that acquisition at all. price,look at the share it is out, so are a lot of people supposedly not worried because softbank is not in a dire circumstance. it's perennial source spot, , the company has $11

billion coming from domestic operations every year. rishaad: great talking to you. moments away from the latest check on china's economy, september inflation numbers next. this is bloomberg. ♪

haidi: this is "bloomberg markets: asia". i am haidi lun. .ishaad: i am rishaad salamat we are moments away from the latest read on chinese inflation. looking at further negativity. the factory gate number is a fallback of .3%. haidi: we have had that negative number all year. rishaad: we have had it for about 49 months. haidi: you do have this weaker currency in play. rishaad: we just have the fix as well. haidi: the fix is stronger

today. is question is what the pboc trying to do. analysts are pointing out that the dollar has necessitated the pboc keep up with the yuan fixing. rishaad: we have the number. let's get straight to steve. cpi a little bit stronger than the economist had been penciling in. >> still below 2% and well below the government's target. 1.9%. we were expecting 1.6%. of a pickup from the previous month in august when we had 1.3% in cpi. mostly due to food prices, vegetables are higher. we saw an excess of 3.5% growth in vegetable and food prices in china. factors going on there, but nonfood inflation

remains 1.5% according to bloomberg intelligence, showing continued slack demand in the domestic economy. let's look at the producer price index, factory gate prices, time ip for the first have to say, for the first time in 55 months. we have had continued producer price deflation for 54 consecutive months. this is the first time in several years that we have inflation at the factory gates, but barely, 0.1%. ofwere expecting a fall 0.3%, so not a big deviation from the forecast or the previous month of 0.8% fall, but still significant nonetheless that we are now back up into inflation slightly. firmer commodity prices factoring in here. capacity ating large industrial companies.

that should be positive for corporate earnings as well as their ability to pay down the big that loads that have accrued. rishaad: thank you very much. these numbers coming through slightly stronger than expected, consumer prices and the fiat positive. inflation at of the factory gate to do will take what we can get. let's get reaction on the market s. very interesting, up for the first time in over 50 months. there is a relationship between ppi and the amount of lending that comes out of japan. more complex, bit but when you have big japanese corporate's in china dealing .ith falling prices i will try to flesh out a chart

for you in a moment. have a look at how equities are doing at the moment, off lows of the day, but really no conviction. shanghai going the opposite to the hang seng, .5% lower. when you look at what is happening in the currency markets, the dollar has had a bit of a run up. down to thet comes bonds. move and asizable lot of small, emerging-market currencies that will add up. let's have a look at where we are for the aussie dollar. there we go. there is your nice reaction. below $.76. the reaction to the ppi numbers out of china. we are just coming off 673 here. it is just about flat here on offshore room in the -- women be

guys. right, let's get the latest on what is going on as we count the cost at south korea's largest company. first word news now. has warned that the overheating phone crisis will cost around $3 billion over the next two quarters. sales of thexpand galaxies seven and seven edge to compensate. it is also doubling the recall of the note 7 in the u.s. to 2 million devices. samsung cut its third-quarter operating profit by $2.3 billion this week after ending note 7 production. samsung shares are up .6%. thailand mourning the death of , the 88mibol adulyadej

oral monarch passed away in hospital where he was treated for various ailments. the government indicated that his son will succeed him. sinceht hit its lowest january. at one stage, heading for its worst week in a decade. the banks and stock exchange are expected to open is normal on friday. singapore's economy contracted sharply in the third quarter in the latest sign that it is struggling in the face of a global slowdown. gdp fell on an annualized 4.1% for the for previous three months. in the export driven economy has been under pressure since last year due to a slowdown in global trade and lower energy prices. philippines foreign secretary says the u.s. will remain his country's most important partner even as relations with china improve. ties have been strange since president where take took office.

a top diplomat has told bloomberg television that the u.s. remains the country's only military ally. >> we have special relationships with the united states. they are our only military ally. you could not put the united in equal that sense footing with china, because precisely we are not a military of china, and the president has made it clear in his pronouncements and engagements with the foreign officials. only maintain one military ally, and that is the united states. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. rishaad: thank you. get some reaction to the chinese inflation data we just got out. emerginga senior

markets strategist. i guess the ppi is the big headline. >> we have a positive inflation at the factory gate. haidi: just barely. rishaad: but you have to start somewhere. >> it is a good sign. it has improved recently, said definitely a positive for the economy and equity markets and the currency, because the central banks have less reason to cut rates further with cpi and ppi trending higher. haidi: before the recent spate of destabilizing data, there were analysts saying that by the end of the year that the pboc would consider tightening. do think that is too early to call? >> it is too early. when you receive this statement from the central bank, the focus

remains on bringing down the cost of social financing, which means the cost of lending. i think it would be counterproductive for them to increase interest rates, especially that much of the upside in inflation occurred due to food prices. it'scpi is much lower, so too early to talk about tightening monetary policy. rishaad: where do we go from here? let's frame this with the trade data we had on thursday, which cause quite a lot of consternation. >> it is always very volatile, so i would not be too concerned about one month of data. incorporate the decline in prices and year on year terms, so without that, we have a much lower drop in exports and an increase in imports. economists forecasting that would have known that. that was a huge mess. official numbers

look like that, how ugly are the real numbers question mark >> i have no doubt about the trade data. there is always a little bit of concern regarding the flows between hong kong and china because of the differences between those two countries, but it does not change the big picture. september was a week month for trade, but it was a one-off. for one moreit data point to see if we are talking about a trend. what i noticed is that trade surplus narrowed sharply to just $40 billion, one third less than a year earlier. conditionshow much could deteriorate if global commodity prices increase. results because of our global commodity prices, then it will be weaker going forward. you did pick up the

ppi thing. about thisalk a lot bubble developing in china. discovery has been driven by cheaper and cheaper lending. is that a concern to you? , it insofar as we don't know what it looks like, has been a theme this year. is that something a concerns you? that situation is the biggest concern to everybody, because not so much of the level of debt , 260% of gdp total, it does not stand up globally, however, what worries me is the increased pace of this debt. it is clear that china will be growing 4% were it not for the massive increase in debt.

if other countries did the same, they would have been much stronger. the fact that china is giving such strong results is a pure reflection of the bubble that is growing. haidi: it is sort of diminishing returns. diminished,ave been but in the last two years, they have stabilized. the process has stabilized. in the long run, it cannot go on like this forever. a mature economy, so it has to. how do the u.s. elections and this possible fed rate hike play yen, very quickly. >> if clinton wins, it will be good for the currency. people are afraid the trouble impact trade with china. a fed rate hike is largely priced in, so yes, it would weaken the currency further.

rishaad: thank you very much indeed. holdingp next, the baht gains as thailand mourns its much loved king. this is bloomberg. ♪

having awe are back look at asian pacific equities, just a bit sluggish today as we are into the midmorning part of the day. let's get over to david. david: hong kong helping things along, providing a small tailwind. we are up .5%. we are coming off highs at the moment, but that is enough for the overall index, which is getting decent support out of the nikkei 225 and kospi.

volumes not quite there yet. stocks fell, but you got a decent head across certain defensive sectors. have a look at australia. the market sums up sentiment across equity markets right now. you are still getting people coming in and bidding it up. , miners,erials financials to a lesser extent, but still under pressure. whatis representative of we are seeing across equity markets at the moment. have been driving equities for the most part. the singaporean dollar falling the gdp report, monetary authority keeping policy unchanged. the thai baht,g

35.19, stronger for a second straight day. weakeningen and a trend eight straight days on thursday. you put everything together and you can see dollar strength addressing the exchange as well. rishaad: nice one, david haidi: let's get a quick check of the latest business flash headlines. shares unchanged after the company warned of a mild inventory reduction. adr fell on the comment during a conference call after posting a record profit. it forecast sales above estimates thanks to apple demand for its chips to revenue through december will be a billion dollars. rishaad: the hack into yahoo!'s e-mail accounts could have a material impact on its acquisition. yahoo! shares falling in new york. buy yahoos core business for nearly five ban dollars. yahoo! saying, the personal

information of 500,000 users had been stolen in a 2014 cyber attack. inflation eased more than estimated in india, prices rising in september against a forecast of 4.6%. case forpport a further easing after the r.b.i. made a surprise cut last month did -- last month. right, back to thailand. the death of bhumibol adulyadej, joining me now is paul chambers. you,ad: great to have appreciate it. what is your reaction first and foremost? >> thank you for having me. the death of bhumibol adulyadej is certainly going to be a shock in many ways to thailand, type people because he was very much

the embodiment of much of the time in the -- much of the thai identity, so moving on will be a tall order for thai people. rishaad: yes, in a sense it will be a hard process of mentally what about the transition itself? what are the next steps? >> i think so indeed. this whole process has been planned for months, if not years in advance. the procedure of his death going through the motions. the idea is expediency, to try to move ahead with the succession so that the economy is not harmed in any way, that there is no political fallout that is harmful to the regime or to the country.

going to benk it is a fairly stable secession. clearly thailand, the economy, the country, has seen dramatic transformation over his reign. he is well regarded and well loved it, as you can see from the scenes in the morning at bangkok. what would you say is his most significant legacy? >> i think that king bhumibol adulyadej, i guess you could say he navigated thailand through 70 years of enormous chaos and .hange certainly thailand's history in many ways could be seen as the embodiment of his identity. , he is: for most thais

the only king they have ever known. an idea of the feeling you're getting on the streets. like a genuine outpouring of grief from these pictures. >> yes, certainly. he was considered like a father of the country because, as you he was able to get into the hearts of people given the fact that the media in thailand insured that people saw him, his image, his family's image every day. he tried to connect with thai people. use very much a part of people's , in newspapers, television, etc., and he also .ad numerous projects

this enormous person who was a major part of thailand. as you say, these succession plans have been laid out for some time now. a lot of preparation has gone in , but can you take us through what you are expecting in the immediate and medium-term aftermath? what are we expecting to happen in thailand? formale is going to be a one-year. period of mourning. economically, i think that thailand's economy had planned for this event to happen. however, ultimately there will be a drop in the thai economy related to his death.

think what we the militarye is dictatorship in thailand is achieving its goals, and that was to create some stability during the anticipated succession, and the succession is happening right now. thatat will happen next is his son will become the next military is overseeing the stability in thailand during this very important event. haidi: we really appreciate those insights. up next, off target, why fast retailing has been forced to scrap an overly ambitious sales plan. ♪

fast retailing has bowed to the reality of a sluggish world economy. rishaad: the chairman scrap his eight year old target for the brand, $48 billion in annual sales, quite an ambitious one this. up with this? environment, stronger yen, weaker jim mann, and the rising competition from e-commerce sites. missed estimates, net income, and had to/that revenue goal by 40%. take a look at their performance in the last four years. oranges see the

quarterly earnings. they saw their lowest net income since 2008. , youurse, because of that can see the yen strengthening their. won announcer: announcer: announcer: announcer: announcer: rishaad: up next, returning to bangkok. trading session is a mixed bag. having a look at the hang seng.

we were marching higher. we remain that way. market setg at the to open in bangkok. these are these streets of the thai capital. ♪

>> from our studios in new york city, this is "charlie rose." charlie: john carlin is here, he is stepping down as chief of the justice department's national security division october 15. he oversaw the prosecution of cyber criminals and 110 people on terrorism related charges. his prominent cases are prosecutions involving chinese military hackers and espionage. the u.s. is weighing in response to russia after accusing it of