tv Bloomberg Markets Asia Bloomberg October 20, 2016 9:00pm-10:01pm EDT
♪ in hong kong. i am haidi lun. rishaad: i am rishaad salamat in hong kong. this is "bloomberg markets: asia". there is only one story happening in hong kong, this typhoon. they don't foresee problems for aircraft until 11:00. indeed, markets pretty much shut. haidi: hong kong whipping up the storm.
philippines confirms it split from the u.s., cozies up to china, the u.s. is baffled by his behavior. faces charges over last year's fatal disaster in brazil. kong this typhoon in hong -- haidi: it is relatively calm, than but looking better the past couple of days. this city is battening down the hatches. offices are closed, banks are closed, schools are closed. cathay pacific says flights will be normal in till 11:00. morning session has been
officially canceled. afternoon,pen in the but officially no training in hong kong in the morning. minutes away from property price data out of china. , singapore,open taiwan, malaysia coming online. isid: the mood in the market somber. have a look. a mixed picture, mostly down for the day, still up for the week. fines are still quite light. volumes are still quite light. , no training in hong kong for the morning session. once it getse you more complicated. , 1-2onger we pushed back
hours. these markets opening up, barely any movement there. if there's anything worth noting, dollar strength coming through early. outsizedget these moves. one point 2244, the weakness in the pound. we are pushing toward session lows in the asia-pacific. dollar-yen above 104. you might want to watch what's -- a fresh six-year low for the renminbi against the u.s. dollar. we have cracked the 75 level.
a big drop in print, 2%, and more weakness on the nearest contract. noteother things i want to , catalysts for things we are watching, 9:30 a.m., property prices out of china. ,wo speeches out of the boj three and all today. we get the budget out of malaysia at 4:00 p.m. local time. rishaad: thank you a lot for that. haidi: we are getting some information from governor kuroda , saying he will be evaluating the appropriate yield curve. curved the ideal yield would change depending on the economy, price conditions, and economic conditions. rishaad: still pretty poor. feel yieldoesn't
target ranges necessary. in the meantime, first word news. car crash death in the united states link to t akata airbags. the victim was driving a 2001 honda civic. in 2008,as recalled but the airbag repair was never completed. wasican honda says the car identified at a far higher rupture risk. hanjin selling its stake in the long beach port terminal. the company is negotiating with mediterranean shipping, a partner, and has first right of refusal. hanjin has 54% of long beach. the court hopes to have final
bids for hanjin assets next month. the german chancellor says a the u.k. path ahead as negotiates to leave the european union. inresa may's presentation brussels later good foundation to proceed, she said. helps the decision will be reversed, but may set that will not happen. >> the u.k. is leaving the eu, but we will play a full roll and tell we leave. we will be a good and strong partner after we have left. work closelynt we together, including the summit. has promisedorea more rocket launches despite international criticism and the threat of her their sanctions. state tv said the program would continue as part of a five-year plan to "conquer the universe."
came after at second failed launch. south korea and the u.s. say they will strengthen efforts to counter the threat. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. thanks. between the split united states and one of its most important allies is deepening. the philippine presidents has announced his separation from the u.s. uncoupling.scious he says he wants to pay the towards china and russia. we have the details, but what is the president saying? >> goodbye u.s. hello russia, and china. this alliance is important for the u.s. this is world war ii. this was the basis of the u.s. strategy towards asia-pacific, and now the philippine president
has been making these comments is coming into office in june. we are not surprised. he has been realigning the philippines more towards china, touting the economic benefits they appeared take a listen to exactly how he phrased this. >> i announced my separation states. united military, but economics also. them, so irated from will be dependent on you for all time. there were people laughing there. a room packed with business leaders, that after he met with , and to topesident it off, he said he might go to vladimir putin and tell him that
there are now three of them against the world. how much of this is politics playing these guys off of each other? rishaad: how does it affect the philippines now? strategy,uld be his but what we are seeing on the economic rot is the taste so falling to the weakest -- the eso falling to the weakest in three years. j.p. morgan saying foreign currency notes have handed investors a three-month loss of 2.4%. philippinethe government and corporate's will have to pay more to issue these bonds. the bloomberg. investors are demanding a higher spread of 110 basis points for philippine sovereign securities over u.s. treasuries, the white line. that is the worst among
developing nations. compared to china, it is lower, but analysts saying that spread could rise to as much as 50 basis points very soon, and coming up from that low in april of 78 points. haidi: the relationship and russia very top of of mine after what was said in yesterday's debate. how is the u.s. reacting? >> they are baffled. that is a state department spokesperson saying they are baffled by his rhetoric. they are sending a top official this weekend. it was a previously scheduled trip, but they will ask for an explanation on this. let's have a look at nissan.
it completed its acquisition, $2.3 billion stake in mitsubishi here. to takeears the way over as chairman. that this new alliance can turn the mitsubishi brand around. of mitsubishi, i am chief executive officer and chairman of the board. do the job.to i will be here to support him and provide him, guide him, challenge them, etc., but the priority today for mitsubishi is reestablishing trust. that is very important. there has been a breach in the trust around fuel economy. this has to be reestablished. the mitsubishi team has been working hard in order to reestablish that trust. we have delivered that in the form of specialists who have
moved to mitsubishi to support them. second, to establish the normalcy of operations. mitsubishi was a profitable company doing well two years ago. obviously, 2016 with the forecasts is very negative, but this is due to provisions they had to take to pay for the consequences of what happened. i hope it will do everything in order to reestablish, but in a v-shaped recovery, normalcy of the operation would resume in 2017. , thee top of this synergies between mitsubishi and nissan, which have been quantified and they are massive. if everything is done and we have a clear plan, you can
saying the ¥80 trillion goal is not needed. that ¥80 trillion jgb by target be needed. referencelso the yuan rate. , 6.7558 against the dollar. change from the 6.73 level of late. a quick look at the latest business flash headlines. falling after profit tumbled from a weak oil prices causing delays for offshore projects. it may reduce capacity as well. one of the worst performers on the straight times index >> nintendo shares have fallen the unveiling of its
new hybrid gaming platform. a promotional video shows several flagship titles. the console is scheduled for release in march. surging afteres results be as commence. it is down to cloud services. investment and cloud has paid off. it's up to offset its mobile phone and pc markets. let's get back to the markets. we are joined by the chief -- et strategist
has your view change much? we went in price for a clinton victory. it has been well telegraphed. extra rangepeso rate has been a traders proxy for the u.s. elections. we saw sterling gather pace this week. vote.tes saw after the that exchange rate began to outperform the dollar index in april. it had giveno, away all that outperformance and was under for warming. in a lot of ways, that is telling us the market is pretty well priced totally for a clinton victory at this stage. rishaad: absolutely. the performance of the mexican peso, that is also true.
we have china very much in the mix with the yuan reference rate showing more weakness. how much does that affect your view? how much is a product of dollar strength? standing back and looking at the big picture, the yuan has depreciated 7% against its trade weighted index, so there has been a different valuation. that makes a lot of sense from a trade point of view. that is showing in the latest set of export figures, struggling to hold any growth of the moment, notwithstanding the decline in the yuan. they have been able to do that without too much pressure on
capital outflows. if that remains the case, we tol see the yuan progressively devalue against the trade weighted index. in terms of how that changes things, from the perspective of ,ustralia and as an exporter that is a positive. did not say draghi very much, but the key take away that he suggested is that they would not be ending bond purchases without tapering. given that there is not much time between now, december, march for them to get their, is it a fair something they will stick with the status quo, and how does that make you feel? was an interesting rest conference. -- press conference. the thingsle out all
the ecb did not talk about less time, it makes you wonder what , maybe thelk about latest soccer results, i don't know. to answer your question seriously, it seems to me that pretty much everything is on the table for the ecb to some extent. this surveyertaking of how and whether they will be able to contend do bond -- continue bond purchases at the same rate. there is a debate between the hardliners and those who are more dovish within the ecb, and we could get a mix of results. we might get an extension of the deadline, but with taper starting very soon or some permutation of that. meeting of the ecb will be a major event potentially for markets. the big't really in picture i think change the divergent view, essentially
their economy is weaker and inflation is weaker than the u.s. in particular. we will see their monetary policy divert with the u.s. that is the bigger picture. the risks in europe are greater. big picture, i think the risk is to the downside. the versions may still have some life left in it. coming up next -- rishaad: the potential merger between at&t and time warner that could create the next media and entertainment giant. ♪
back up to three days of gains. the dollar above the 98 level, the yuan fix at 6.75 today. $50 despiteabove russia's saying it may be boosting production. time-warner jumped on reports that it is in takeover talks with at&t, shares closing to the upside. senior executives have met for range oftalks on a subjects, including a possible merger. a possible deal in the works between time warner and at&t? that speculation had stocks on the move. time warner stock up better than 10%. at&t down 2%. that is said to
be taking place, executives at both companies said to the meeting informally over recent weeks to discuss various business strategies. those strategies said to include, wait for it, a possible merger. that has pushed time-warner higher, and with his closing price, evaluation close to 67 billion. the executives are said to have ceo and the time-warner saying he would be a willing seller. 2014, time-warner rejected an offer from rupert murdoch and 20th century fox that valued the company at more than $75 billion. that was rejected. $85 a share. to be ready for a deal at this point, a lot of
"bloomberg is markets: asia". i am haidi lun. rishaad: no session in hong kong , schools shut, airport as well, delays taking place, cathay pacific saying the flight schedule will remain normal until 11:00, then delays down to the category eight storm. haidi: we are going into a bit of a shutdown with banks and government offices close.
it could be an interesting trading day when it comes to mainland markets. oc weakening the yuan fixing. shanghai and shenzhen about the come on stream. haidi: let's find out more from david. david: let me get started with , the fixing coming out 15 minutes back, a surprise given that it was the biggest adjustment since august. we have been on a weakening trend in any case. we are seeing a little leg up. with leading to this?
some people are pointing to a big drop in the euro overnight following with the ecb did not announce, perhaps pushing up the dollar, an adjustment here and there, then we find ourselves in this situation. 109.21 is your level. -- 1.0921 is your level. there we go. we have been pushing higher and higher for the most part of 26 dean. for thewhere we are -- most part of 2016. that is where we are at the moment. preceded levels which two selloffs in risk assets previously. something to watch. in shanghai, not in hong kong, we are close to your,
philippines also, nothing there, shanghai down. three trading debuts in the mainland today. if history is any guide, there we go, different day, same story. ipo, regardless of what they do, does not matter what violation, there we go. a good day at the office in a quiet day across market so far. rishaad: right, we are waiting for data out of china. keeping an eye on that. we will bring it to you. haidi: let's get to first word news. shery: thanks. hong kong bracing for the arrival of a typhoon. are suspended and airlines are warning of flight disruptions to their is no trading in the morning session. will remain in force for much of friday.
it killed at least eight people in the philippines on thursday. the pboc has weakened the yuan reference right by the most since august. 6.70 558 is .37 of a percent weaker than yesterday. the u.s. currency surged after its key interest rate at zero. the philippine president has widened his lead with the u.s., telling business leaders in beijing that he is dumping his company's traditional ally and embracing china. his comments are the strongest yet. the philippine president has touted ties with china an russia since taking office in june. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg.
rishaad: in the sum september and october data. haidi: china housing prices keenly watched. over to tom mackenzie for the latest in beijing. it looks like growth is continue to happen despite curbs. tom: that's right. the housing sector so crucial to the economy here. beijing new-home prices for september of 30.4% year on year. , september new-home prices 39.5% increase, so it seems like prices are continuing to rise despite curbs. they were putting curves in place to make it more difficult
to buy houses, increasing down payment levels. fake divorces in shanghai and people barring on lines of put down payments on those properties. we just have another line coming through, september new-home prices rose in 63 cities month on month. prices rising for september and ,3, comparing to 64 last month so a marginal tick lower, but not a huge amount of comfort for policymakers trying to rein in some of these prices. it seems like the curbs are taking some time to have an think, and some analysts putting these restrictions in place encourages buyers to snap up homes before further restrictions are added. there has been pressure from the central government at the provincial level.
they are concerned about a property price bubble. we had to gdp number, you saw construction growth slowed, but demand from buyers increased. we saw a retail services increased 9%. we also saw new loans to households increased, and a lot autoose loans for the sector, but also the real estate sector, and that feeds into concerns about whether households are becoming overleveraged. the national bureau of statistics talking about these curbs put in place, saying they will reduce the sales and prices and investment and targeted cities, but overall nationwide, it should not have too much of an impact. deutsche bank have looked at this. -- of therefall of was a fall in housing prices by 10%, that would knock off $63
billion in value. 63 price rises, very strong prices still. haidi: thank you so much for that. a range of charges including murder ov a fatal collapse of a dam in brazil. all three companies say they will fight the charges. let's get over to paul allen in sydney. what are the prosecutor saying here? they charged 22 individuals, 21 of them charged with murder. there are 12 charges of environmental crimes as well, some pretty serious stuff. if convicted, they could face 54 years in prison. this is linked to that disaster
in november with that tailing of failing and billions liters of slides swept down stream, floating houses, killing 19 people. prosecutors are saying the accused were aware of the possibility of a rupture and decided to continue production. haidi: they have already rejected these charges on what basis? what are they saying? they deal with each of them in turn. they refute the charges and said it had no previous knowledge of structural risks at the jam. the head of iron ore is one of those charged with murder. said it neverle participated in an operational capacity, but bhp said it will
defend the charges and will offer support to any individuals involved. so much for you that. paul allen in sydney. rishaad: right, alibaba's singles day with record sales last year. 1/11.: it is 1 if you're single, don't worry, just go out and spend a lot of money. theyba's copresidents of have higher hopes of doing better this year. the singles day is the biggest shopping day of the year in china. we kicked it off last night in china with the announcement that david hill will be directing it for us. katy perry will be our global ambassador. thousands of merchants,
entertainment, a wonderful event that all of china and many different parts of the world will participate in. >> i was there last year. your process $14 billion worth of merchandise in a single day. what you expecting this or? >> $14.3 billion last year actually. the numbers will be bigger than last year. singles they successful for us is a large amount of products that changes hands between merchants and consumers, but it is the social event for, a great all the people that participate, and we have not achieved what we want. tojack ma sent a letter shareholders that rattled investors about how alibaba needs to transform. it's not just enough to be e-commerce. what does that mean for your job? >> we have to think about how retail will change in the future. people may have misconstrued his
letter. it is the change in morphing of the retail model that he is referring to. areart of the reason you here at vanity fair is to dispel some of the untruths and misperceptions about china. some people don't really understand what alibaba does. is not the amazon china, it is something more. it is difficult to understand because there is not quite an equivalent. what is alibaba? alibaba, particularly for a u.s. consumer, is a combination of facebook, google, and amazon. what do i mean by that? we have a social component to our commerce program. we have a surge component in everything that we do. we have an innovation and club reflects thech totality of businesses that you see within those three companies.
we do that all in one place. if you look at our businesses today, core commerce, big digital media and entertainment, and services and innovation side of the business, which is very important, from travel to ride sharing to involvement in food and food delivery and health, reality,augmented virtual reality, and the technologies of the future. those are enabled by our cloud computing business, payment business, logistics business, and advertising and merchandise. haidi: that was alibaba's co-president. next to -- rishaad: the swiss watch market. that will be next. ♪
rishaad: a quick check on the latest business flash headlines. j.p. morgan chase accused of , saying thelues bank ignored fees when determining values for structured loans. morgan inflated valuations by as much as 15% in one case. the bank has declined to comment. month raising prices next to avoid winter shortages, china's top economic planner urged all suppliers to raise output. petrochina may hike natural gas prices. rishaad: swiss watch exports dropped globally with shipments to hong kong plunging 40%. exports to china did less than 1%. groupad of the swatch
seeing chinae been growth potential. they are not alone, because there are other luxury watchmaker's that still see growth in asia despite the slowdown in china. rishaad: let's get over to shanghai. thank you for joining us. onhad seen this crackdown conspicuous consumption take place in china. are you seeing that coming to an end, and how is the man holding up for you? been building operations in china. we are here in shanghai to open our 25th store in the world.
our business in mainland china is continuing to grow. chineser concern is the travelers, trying to define their next destination. this is the important challenge for the year to come. 45% of your business comes from chinese consumers, including tourists. it has been a hard slog with the down,evaluation, the slow the brexit concerns now rising, what are the risks and how resilient is the business? >> basically we have been faced the last couple of years with major changes, currency volatility, growing local markets. i was recently in london, and the brexit, at the vibration of
, bringing usound new clientele in london, so the is is in uk has been strong for the last three months. it's interesting reading your research saying that what you do is follow the tourists. they change were they going to go. how do you do that? >> we basically follow precisely the currencies. we have operations in the major countries where chinese are traveling. we are seeing strong growth in australia and korea, more challenging conditions in hong kong. basically it is a very visiting that we have on the fact that the chinese are changing their pattern of traveling rapidly. , you see yourpany
cells as the makers of supercars, yachts, or artists, if you will. had you explain that. what do your clientele want out of a timepiece. have a strong clientele, more than just watches. tohave a price that is close 60,000 euro price level. our base of customers is growing because we see growing demand in ,he world of niche brands people aware of what they want to get. rishaad: you run this campaign
i would love to, but i can afford it. what your margins like? >> this new campaign is launched right now. all thenetted association of the brand. it is a statement in terms of design, richness of caliber, rare because most of our is behind this associated claim, dare to be rare. haidi: you say there is strength in korea and australia. are they domestic consumers? flow of following the
the chinese tourists. ? the tourists we have right now is a strong part of our business. are developing local markets in china, japan, and the u.s.. there is also a growing potential in the domestic american market. rishaad: thank you so much for joining us this morning. coming up next, nintendo having a tough slog in tokyo despite the much-hyped launch of a new gaming platform. rishaad: why investors don't want to play. this is bloomberg. ♪
up, trying to regain a foothold in the gaming console market. has unveiled a hybrid gaming device that can be played on the go. the stock is taking a massive hit. what is wrong with this new console, if anything? the reaction was mostly positive. the overall chatter on social media was positive. people thought it had some innovative's features. out 2% of, wiping value, big move, clear reaction from the market that it is us not happy. last time they released a console and 2011, the stock dropped 5%. , the market signaling it is not happy. why?
it is not clear. a lot of analysts say it is trying to find this niche between smartphones and consoles. everybody probably are ready has a smart phone. will they want this device? nintendo's new controllers will be more interactive. i think the market clearly disagrees with it here. 7% down so far. 6%, actually.
we will see how that plays out. it is a puzzling reaction from the market given how optimistic most of the initial analysis was. they will release super mario in december. three months after that, they will release which. why would you need both? for everyone who has a smart .hone nice one.ugene, in talks to sell