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tv   Bloomberg Daybreak Asia  Bloomberg  November 27, 2016 6:00pm-8:01pm EST

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♪ >> oil under pressure again. opec will achieve an output deal. saudi arabia says let's may not be needed. factor last month, sparking optimism companies may be able to start paying down debt. showsck friday weekend good for e-commerce, but customers wanted to spend without discounts. the hongthe date that
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kong-shenzhen soccer match will start december 5. york,m betty lou in new where it is after 6:00 p.m. on a four-day long weekend, sherry. shery: i am shery ahn. you said it, it was a four day weekend, very festive for the u.s., and a market rally. betty: we ended on a high note. there was a thin trading as we got into the holiday, the thanksgiving holiday. particularly with this week with the opec meeting, how the markets will trade, but you are kicking off this week as well. shery: we are all focused on opec, but these producers will do. they are curbing supply, but take a look at markets now. new zealand, they had a rally last week, gains of the past
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three sessions and gaining again up to 0.2%. the kiwi dollar on change. the afx seeing pressure down to 01% -- 0.1%. is losing dollar momentum. let's check on the open in japan and south korea. checking futures trade in chicago, negative in the red, but that is after the nikkei surged for the past seven sessions. the yen was weakening a little bit, strengthening again, but this after three weeks of losses. that is a look at what we can expect in the region. what is ahead for wall street this week? i know opec will be another key issue ahead. julie: it looks like you guys are picking up on a mixed note. what will be the focused at
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least for tomorrow's trading session is how well black friday sales did. how much of the american consumer, how much did they go out and spend on money? it was an interesting price point. $10 less is how much americans spent in total, $289 on average according to one data point. the might actually mean rally you thought going into last week may not last going into monday session. and you mentioned the price of oil. it could be going down as opec makes a lasting deal. the cartel will meet in vienna to try to finalize that. ramy inocencio is following this. saudi arabia is the key here. >> it is not just them. i am calling it the opec scramble. you see energy minister's flying
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around to russia, trying to go to iran had convinced them. there is one with opec, the other with non-opec. let's talk about cuts. we are talking with opec nations of a cut of -1.1 million barrels a day. this is from the algerian energy minister talking to iran, but also with non-opec, cutting 600,000 barrels a day. this is a proposal. there are disagreements with both camps. hop into the bloomberg. i will show you opec go. you can see the output of all of the member countries. this one in particular, focus on iran, a few down. it is pumping 7 million a day in october,it is pumping 7 millionn october, passing 4 million, but they are the hold out. they do not want to cut because
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they are recovering from nuclear related sanctions eased in january. with the non-opec nations, russia is the biggest oil producer in the world, coming in at 11.2 million barrels a day. this is eclipsing what had been saudi arabia. united states 10.7 million. in it she ministers in algeria and others -- energy minister's in algeria are traveling to moscow to convince them to cut. they will not cut, they prefer to freeze. let's talk about price forecast. without a deal, there could be a $30 level again. what happens if opec goes ahead and pulled a rabbit out of his hat? the $30 is interesting, price mark is very bearish based on what is happening in the past week or so. you talk about iea, being more
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bullish. they think it is going to happen. go back to the bloomberg. isill show you what happening with history. if it is any president, you can precedent, you see it is 34 million barrels a day. if opec agrees to cut, that would be a drop of 1.1 million barrels. that last time was in june, below $49, about $48. we will bring of the forecast. we will show you what people are talking about. iea is talking about $60 a barrel on bloomberg television. this could cause u.s. shale production to increase and bring prices down. 50 dollars to $55 a barrel.
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we have a couple of days to go until we see what happens out of the enough. shery: we will see if they are able to create that zone between $60 and $66 a barrel. thank you for joining us. now to first word news. profit at chinese investor companies accelerated last month as prices recovered. the bureau of statistics say is profits rose a fraction under 10% in october compared to a year earlier with $89 billion. this comes as studies and flying economic -- with steady and flowing economic growth. pressure is mounting on the president of south korea and a big protest. organizers gathered in sold to demand sheep -- in seoul to demand should be arrested.
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she was accused of peddling influence and allowing people on do access to government. former prime minister francois dione will lead the country in the election. traditional french values and tough economic reforms against the far right. there are calls for him. the death of fidel castro has prompted questions about the u.s. with donald trump reacting differently to the man who will succeed. president obama issued a statement offering condolences to the castro family. trump tore into the former leader, echoing campaign promises for a better deal for both the u.s. and cuba. he will be buried on saturday. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries.
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bloomberg, back to you. shery: thank you. china has taken another move to opening up financial markets with authorities setting next monday, december 5, as a launch day for the stock connect, shenzhen-hong kong. we have been waiting more than two years. reporter: we have seen three years of rehearsals, and now they are ready for the shenzhen-hong kong connect to start up. it has been two years since the , andkong-shanghai connect so this new second link has been what they anticipated and has been delayed. there are many tech companies listed in shenzhen, but this could be what they are interested in in the sector to get into it directly themselves. shenzhen and shanghai are the
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same, so the yuan's, nine point -- 10.5 billion yuan, $1.5 billion u.s. southbound going south. they can also access in the stock exchange small and mid cap , greater than six billion yuan. anything still listed is sean john -- in shenzhen and hong kong. the -- thed on shenzhen is pretty -- volatile. it has lost 7.8 per year and gained 67 last year. a really big swing. month any moves by china to open up the capital markets this year. rosalind: china has said it is
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committed to doing this, opening markets. earlier, there was a limit on foreign involvement in china's internet banks bond market. and bloomberg reported the guidelines of the qsi asset allocations had been scrapped, and this because of the shenzhen connect opening up to outsiders to china. but it does seem that it is more popular going southbound. you so they could use half of that $45 billion project to buy shanghai shares since 2014, but chinese traders buying and hong kong, less than 20% of the closure. they: thank you, on shenzhen half in hong kong connect. ---hong kong connect.
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people spend less than a year ago in the u.s., which has a bigger impact on cyber monday. su keenan is here with more. what happened? reporter: you mentioned one survey shows less than 2015. usually it is a race out of the shopping day, shop till you drop, this was more of a limb, we did see an increase of 2% in the shoppers, 154 million estimated. 40% online, 40% in brick and mortar stores. of those shopping in stores, all were focused on heavy discounts. a third of people said they were only buying items on sale. we talked to brian connell, ceo of target, he said it was great. optimistic about the consumer economy. it is a great time to be a consumer in the u.s.. the overall gdp growth is solid,
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and it will expand. we are seeing good movement in employment, low interest rates, low inflation, and certainly in food, deflation. 51.40 seven at home, and what you see is a trend of fewer purchases, cheaper buys. .et's go back to the video online shopping will be the determining factor, cyber monday . we may see what hundred 22 and -- 122ppers, million shoppers, and that could set the tray forward. betty: there is a lot of economic numbers out this week. what do we expect? wholeer: we will get a slew of numbers, and there is a countdown to the december rate hike. we are expecting to find november payrolls likely group, indicating a tighter labor market. u.s. consumer spending and
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incomes in october, modest many factoring inflation numbers. based on the economy and the direction of the market, as we kick off monday. betty: we are kicking off sunday morning -- cyber monday. what stocks are we supposed to watch? reporter: sales hit a record. it could short out what happens in the department stores. stored, andlly over that is why we will close tens of thousands of more stores. we will close malls and have a massive real estate problem. we are over stored, and the fastest-growinga is online -- growing areas are online. reporter: amazon will be a big one. shery: shoe -- su keenan on the shopping spree in the u.s.
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how data on everything from oil to more, shedding new light on the dark corners of the chinese economy. betty: and the benchmarks pushing back close to 2016. that is before the traditional december rally. anything to stop the party? ♪
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♪ asia. this is daybreak shery: a quick check of the latest business flash headlines, china has tied monetary conditions in recent weeks. at analysis of the transaction shows the pbmc has come back market operations and is injecting more funds in the 14 and 18 day contract raising short-term borrowing
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costs and bond yields. the move is seen as another sign of tightening. betty: leaders of the campaign to take the u.k. out of the european union have rejected a report planned by the bank of government -- bank of england mark carney. reports say he has discussed ways of allowing companies to remain in the single market for two years after brexit. the leader calls for a clear, clean, and simple approach. shery: peruvian air has been fined 1.3 million in -- $1.3 million from a parent company. familyts owned by the [indiscernible] they have been sent to prosecutors for further consideration. korean air has declined to comment. betty: oil dropping the most in over two months last friday.
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there are doubts opec will reach a deal this month. we will bring in the chief market strategist, joining us from melbourne. how important is this opec meeting on wednesday for the market? is one of another of key event risk to the physical side of things. looking at the o-matic side, the euro what is happening with look at what is happening with fixed income. in terms of absolute risk and observational risk, it is very keen to the moods in oil. i think the idea that we could see a rerun of what we saw in april where there was no change in oil prices and they came up sharply, that appears to be an elevation risk given the weekend news and the saudi's not meeting
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with opec, lack of consensus in opec. so there is no agreement whatsoever. it is very wishy-washy. betty: it is an elevated risk. is it likely risk though? believe -- iot to am not an oil analyst, but i will try the oil price. if i am assessing the risk and what it means for probability, is that you have got to believe opec knows the risks that are involved. i have seen enough case studies that if you don't get something cobbled together, it will hurt budgets moving forward. that is one of the things they will push very closely. all syrian oilhe minister looking at the architect, and trump pushing this along at the moment. they know what is at stake, using communication as a guide
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to try to limit the downside a likely scenario. communication is key to the market. betty: it is very key. ,utside of opec, though chris you see the markets are, we have a bullish set up throughout all the industries. >> not all the global industries. if you look at the fx in australia, the bulls are firmly in control. you have all the u.s. markets, the nasdaq, the snp on all-time high -- highs. price dictates we see reversal, but we have not got that at the time. if you look at the fact markets are what are emerging, pulling back could be shallow indeed. that is a bullish indicator. you have the csi 300 in china buying the highest levels of the year of that as well.
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europere risks around with the political side of things, but markets don't look too bad either. you have people breaking out, indicating there is a bullish affair. and we have hard, some pullbacks at the moment. shery: let's look at the asx 200, because you just mentioned it. very much affected by oil stocks, just broke through 5500. they are hiding this year's high, the rest coming from opec, and trump economic policies playing into the housing costs. where do you see the index going now? you know, as more volume is back into global markets, we will take a large element of guidance from that market when it comes back online tonight. for us in australia, you're talking energy.
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the big banks are 30% of the market, and at csi, we are putting up 56 basis points. we are seeing a situation where the central bank cannot offset that with monetary policy. 4%,gage rates are hitting fixed rates in australia moving up. we are seeing this cross eyed tightening, which can be offset by management policy, and it would be interesting to see how equities will react. david: equities all over the world. shery: thank you for joining us, the strategist. betty: and coming up next, prime minister modi takes to the crash goes india's into the fourth week. see if there is relief in white. ♪
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♪ betty: i am betty liu in new york. shery: i am shery ahn in hong kong. indian prime minister narendra modi has used his radio address to assure people the crash cash crisis will soon ease. it has been a chaotic time for india's people, but the prime minister is confident they can overcome this. >> he will stamp out tax evasion. he said the benefit for the country will come soon, reminding at the time he announced the decision on november 8 it will take 50 days to see it through. 500 have held december 30 two exchange them for fresh bills. modi also warning against using the port to recycle money. we are halfway through the transition.
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it is presenting a problem for a nation used to making cash outents, atm lending smaller bills. banks,amping up indian pulling the equivalent of $75 billion. this has prompted r.b.i. to have measures for central liquidity. shery: what are the temporary measures? >> the r.b.i. is instrumental cash reserve ratio. reservemental cash ratio. the concern is the rise i -- the rise in banking quiddity will have inflation. the 10 year yield fell 20 basis points in the week to december 25, on track for the biggest since april 29 this month. betty: thank you so much. the ongoing situation in india dealing with cash crunch. shery: we take a look at how big
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data is reshaping economic analysis in china. this is bloomberg. ♪
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♪ a.m. monday in30 hong kong. we are minutes away from the first major open. mark: and it is -- betty: it is 6:30 in new york. many people are rushing back, after the holiday weekend. and we are waiting for the open market on wednesday. at what risk to the market, there has been overall bullish sentiment since the donald trump election to the white house. shery: we have seen three weeks of gains for global equities.
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we are now seeing another day of gains for asian stocks. you are watching daybreak asia, so let's go to first word news. rosalind: oil tumbled the most amid increasing doubts opec nations will reach an agreement in vienna. another meeting with non-opec was going to take place on monday after saudi arabia pulled out. they will have another internal meeting to reserve -- resolve distances about iran and iraq. announced the biggest monthly decline of the yuan since 2015. this arrives two years after the shanghai-hong kong connect and will open up the mainland harkin. many companies are listed in shenzhen. holiday spending was less than
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last year, another sign american consumers are reluctant to spend. in person and online, there was $298 in average, $10 less than 2015. most companies saw people buying stuff that was on sale. and disney's animated musical film moana has topped the american box office, bringing in $55 million. the hamilton creator lin-manuel miranda outperforms three other releases. it missed ticket sales, estimates from news website. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. we are seeing asian stocks lacking intellection as we see the brief pause in the
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dollar rally. look at the how the asian markets are going. here's haidi lun. this is really the week of truth when it comes to opec. it is all about oil, whether we will get this cap that has been so much talked about over the past double of months or so. we get a lot of confliction reports about who is in and out. we could see a plunge in oil prices on friday, the most in two months as optimism for a. -- fades. kiwi dollar up 0.2%, australia down. you see the losers, energy, materials, and the miners seeing selling pressure there. let's bring up futures to see what we are expecting from the major market open in japan and korea. this is what we are seeing. 0.3%.o nikkei going down,
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that could be a bit of a bounce at the open. in hong kong, pretty flat at this point. we have been watching currencies as a result of this extraordinary dollar strength. this is the dollar-yen, 112. they are coming off the week of 114 we saw on friday. that could put pressure when it comes to the japanese open, but we are watching this emerging market currency space. take a look at the rupee, trading has not started, but indian trading fell to lows. the philippine peso, the malaysian ringgit, and the chinese yuan falling to a record again in the offshore space last year. -- last week. trading will get underway soon. betty: what energy materials, we
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continue to watch commodities and metal, that is a big deal. haidi: we are not preoccupied by with oilwith oil prices. we are also watching gold. that is actually the one week future we are looking at. today we are up 0.1%. we know this has been coming down on pressure metals, the dollar story, the yuan, and defense. a lot of that is going to inform where the gold price goes from here. it has been badly beaten down with this trump trade rally. take a look at the mood in terms of australia. gold miners are watching closely. gold production output in australia rose 3% year on year. a lot of producers taking advantage of the fact the aussie dollar denominated prices are
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looking better. here is a real pickup, evolution surging 1%. outperforming the broader australian market, down 0.3% at the moment. where watching the rest of the middle space in a moment. in just aspace moment. iron ore has been wrapping up ahead. we were look at the miners, down by and large today, but iron ore continues to ramp up on speculation as well as existing cargo getting snapped up. it could cut exports if it is beneficial for them to do so. watch for that. that is a lot to watch, and it will be jampacked. setup of the markets. early day for big data in china, but economists think it could change the way they look at the second-biggest economy. jeff kearns has more on this.
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we are talking about big data, changing the fuse on china -- views on china. what are they doing with it exactly so they can more accurately forecast trends in china? >> that is right, the big data is coming from in a lot of cases the big companies. here that is often alibaba and baidu. information covers all kinds of things, but allies focused on , and onlineps purchases. when you start looking into that , you can find a lot of incredibly detailed and high-frequency information on all kinds of aspects of the economy, especially the consumer economy, which is getting more and more important to the economic growth picture here. so a couple of examples that are interesting, by do, everyone , you can baidu mavs
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track where people want to go. if you want to find out what kind of interests -- restaurants are doing well or not, what kind of places people are doing, in one instance, karaoke bars, you can find that. you can see who is looking for that and how often they are going. if you want to get a read on how consumers are going to be picking up new iphones, you can track how many people are visiting apple stores. it is a way to take this massive amount of data and pull it together into specific searches for locations or industries or companies and get a unprecedented read of how the economy looks. shery: it has always been tricky in reading the chinese economy given it is hard to trust official data out of china. how important is this? jeff: that is right, there have been some doubts.
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china does not have the same kind of survey-based regular unemployment rate you would usually find. one proxy for that is a new kind attraction by location. how many people are going to work at high technology parks. you can check that off of data. what is important about this, this is an economy which is increasingly well integrated into the entire global supply chain and trade, getting a faster view of activity here that is not always reflected in official data. thank you so much for talking to us. that was from bloomberg china economy editor. now this australian gaming -- gaming company jumped. they may try to get rid of plans. who are we talking about, and
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what would it mean for their plan code word greatis, the plan was the philosopher who said everyone has a plan until they get punched in the face. the plan was going pretty well. they had a team that was aimed at creating a $4.5 billion , they would create a gamblingaustralian industry. they could take on william hill and lambrecht. we have the report in the mail on sunday in britain that lambros has hired advisers to pay for four of them. we look at ad court shares right now, up 3%. they are now off 0.1%. they have tried this in the past. out a joint put
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venture that was rejected. we will see how the new plan unfolds. betty: we will keep our eye on this developing story. conservativergest investors has found an unlikely ally in the most flamboyant politician. we are talking about donald trump with japanese giant pension funds. we have a look at how this conservative investor is getting a helping hand from donald trump . what is happening here exactly, ryan? ryan: i think there are a couple of things happening, and the main driver starts with currency. the dollar-yen hit an eight month high on friday, driven by the steepening of the u.s. yield curve and the widening gap between u.s. yield and japanese yield. that is that a five-month high.
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that creates incentive for japanese investors to send money to the u.s. for higher-yielding assets. that brightens the prospect for japanese export earnings, and it also puts easing pressure on inflation. the downward spiral and prices have seen over the last few months think of easing, and that will create more of a polish environment for japanese companies -- bullish environment for companies at home. betty: it is funny to see that most analysts were concerned the trump victory would hurt equities and make the yen stronger. how likely will this be sustained? guy: it really is -- ryan: it really is quite surprising. this is the fifth best of about 100 we have tracked since november 9, definitely not had -- if anything, the opposite effect of what we expected.
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today see currency moves could extend into next year with the widening of the yield between u.s. and japan. some are talking about the dollar higher than 120 in the next 12 months. at home, we are seeing a lot of the labor market development that mr. kuroda at the boj has been talking about. we have the interest rate at the lowest in two decades, we have .een signs of wages rising mr. kuroda himself has talked about 0.9% wage increase, which may look small, but it is a bigger increase than janet yellen or mario draghi are set to get. we have a bullish sign for mr. .uroda at the boj if you can extend that to the rest of the economy, yes, the framework is pretty strong going into next year for some kind of
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sustained rally. betty: thank you so much are joining us. ryan fowler from tokyo. and the man at the head of hong kong's oldest register company, the ceo of hong kong hotels discusses room for growth in the current economic scenario. ♪
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♪ shery: this is daybreak asia. betty: a quick check of the ,atest is this flash headlines reports from japan to the bill for cleaning up the fukushima nuclear plant could be more than $175 billion. the nikkei news site estimates from the industry department, which combines cost of accommodation and decommissioning the nuclear reactors. they were devastated by the powerful earthquake in march
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2011. the new earthquake did not cause any new damage. shery: taking on ge and siemens for a bigger share of the health care solutions market. the company manufacturers scanners and take ticket medical gear but says a medical software market could grow twice as fast. they hope to improve interpretations of data from scans. software accounts for $3 billion of stainless steel. betty: mitsubishi will recall 25 million vehicles in china. the control watchdog said the recall involved 24,000 ansi x and other suvs. it was down to flaws in the rear doors. 4000 will be recalled in march over defective airbags. mitsubishi has recalled 100,000 cars in japan for airport --
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airbag purposes. oldest register company in hong kong, the font operateshe hotel group around the peninsula and is operating with 150 years. profits fell, but they are confident about the future. joining us, clement stokes. thank you and congratulations on your anniversary. how difficult is it to remain competitive for 150 years especially given the market headwinds we have seen recently. in the first half, you slumped. how do you overcome that? morning. the reason is we had major assets under renovation, the peninsula in beijing. otherwise it would have been flat compared to last year. on the wider question, hotels is
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a cyclical business. we are the owner and operator of hotels. we own real estate as well, so we have to hold assets for the long-term. we ride through many cycles of and down, and that is how we have survived 150 years by maintaining our investments, keeping to our way of doing business, to maintain the quality. shery: it is impressive. let's break down your revenue, for example by geography. this is interesting. the profit would have remained slack. take a look at my bloomberg, looking at the financial analysis. if we break down the data, you see a geographically. hong kong takes up the lion's share followed by other markets in asia and the u.s. even though we are seeing the slow down from mainland chinese tourists coming into hong kong, are other parts of asia or in the world able to make up for this fall?
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>> some markets are stronger than others, hong kong is down but not as much as people might think. we are seeing growth in china, a lot in japan. it is a mix. the world is still fairly uncertain in terms of quality -- politics. conditions are not strong. but we are holding our own and hoping this will come back. shery: best growth market right now? clement: japan, tokyo. we have an attractive product, and we are seeing good trends. betty: clearly there is strong trends throughout the world for your hotel group, but there is a lot of consolidation also in the hotel industry. the bigger you get, the more skilled you have. i am thinking of the merger between marriott and starwood. how will that impact you?
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clement: we really focus on a different segment of the markets. we are owner operator, so we build oh tells that are -- hotel that will last a long time. that is how we got to 150 years. within that, we have stayed small and focused. we only have 10 level hotels with three new projects under development. we are focusing really on the investment and maintaining quality. in terms of, because you are so careful about where you are expanding, what are the new markets you are looking at? you look very carefully at a new market. only theyeah, not choice of market but finding truly exceptional locations. if you look at locations around the world, they are not only in prime locations but quite exceptional locations. the new project under
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development is in london, where we are at the bottom of hyde corner, istanbul, the bottom overlooking the oh tower, and young god in myanmar. pretty exotic locations for the high-end. shery mentioned this earlier, but i am interested in currency fluctuations and how that might impact business traffic in your hotel. do you anticipate that volatility? affect: currency would demand a little bit, but at the level of our customers, very high and, it is sensitive to currency movements. at that level, people will not come or will come because of a relatively small currency appreciation or depreciation. it is more about quality and whether you can get the repeat customers to keep coming back
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because they enjoy the experience. betty: thank you so much for joining us on your 150th anniversary. ceo of hong kong and shanghai hotels. much more ahead, china planning to compete in the stage three, private people making their mark. ♪
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♪ shery: china is spending billions of dollars on the space program, and is not a state led effort. tom mackenzie reports from changing. -- [indiscernible] >> china's private space ambitions are taking flight. technicians are putting the final touches to a capsule connected to a giant helium balloon. it is designed to climb to near space 20 kilometers above sea level. the company behind the project
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has lofty ambitions. they want to commercialize man-made -- amanda space travel. space travel. they have to test the life-support system. you heard about monkeys and dogs, but the traveler will be transporting this little guy, a two inch terrapin. this man is hailed as the elon musk of china. he wants to make space travel to accessible as many people as possible and use reusable parts, keeping it below $100,000 per person. >> our goal is to make normal people to go to near space, go by rockets. it will either give you a crazy leading up or crazy dropping down process, which is very
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difficult for normal people to go. we want to develop that it goes smoothly and is just like taking [indiscernible] his ambitions dovetail ,ith china competing with china russia, india, and japan. operationo build an in a space station by 2022 and want to send an astronaut to the moon by 2025 and land a vehicle on mars. china launched this one in october, sending astronauts into orbit for the longest mission yet. and even though it is private, it is backed by state money. the final frontier is still dangerous, and a long way off. half-an-hour after lunch, 12 kilometers above the hours -- the earth, the system failed, the mission aborted, and the
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turtles crew is unknown. there is plenty more still to come with them burst major
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♪ than never, the hong kong-shenzhen stock connect start after a two-year delay. , saudiunder pressure arabia says cuts may not be needed. china has quietly raised borrowing costs, reinforcing the view that it is moving away from monetary stimulus. >> the black friday weekend reveals a shift online, shoppers reluctant to spend without those
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deep, deep discounts. this is the second hour of "daybreak asia". it is just past 8:00 a.m. in hong kong. >> i am betty liu. it looks like we are down slightly, may be shoppers not out there as much as we thought. my sister were shopping at every mall this weekend, but they weren't spending as much. shopping in asia, getting discounts online in the u.s., so maybe we helped a little bit. >> indeed. >> asian stocks are rising again, a lack of direction at the moment. opening, andst let's see if it continues to search for another day of gains. haidi lun has the latest from the markets.
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there is a lot of event risk building into trading this week. opec come all about oil has that meeting is underway. we will see the moment of truth, can producers get to this production cut priced into the market? prices, down another leg, 30 three cents, the biggest trop in more than two months on friday as optimism starts to fade about whether an agreement can be reached given not all parties are still on board. we will be watching the energy space in particular this week. asian session, mixed picture, nikkei 225 giving back gains, down .5%. we do have a stronger yen, so weighing on sentiment there. up by .10 percent,
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massive protests over this influence peddling scandal plaguing the leadership. in australia, some weakness, down .2%. new zealand stocks up by .25%, driven by agricultural stocks. aboutt week was all energy and materials, and this week, you are watching commodities and metals space. >> we have this ramp up when it comes to metals, front and center given china pmi's this quarter indian third gdp, so feeding into growth and investment prospects. this is iron ore, bouncing on friday. we have seen a variety of notes saying speculation continues.
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we are seeing further demand when it comes to these miners. rio tinto saying that it is open a cutting exports if it is financially beneficial decision. some downside for bhp billiton and rio tinto. finally, gold prices, the dollar story, a lot of risk coming through from fed speak this week , as well as that china demand story feeding through, but a really nice rally at the moment when it comes to gold producers in australia. , a good dayrces when it comes to some of these miners down under. so china has taken another move to opening its financial markets with authority setting next
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monday as the launch date for the shenzhen-hong kong stock connect. highly anticipated to say the least, more than two been years in the making. rosalind: ever since they shanghai-hong kong connect, investors have been looking to the next one. after rounds of testing and rehearsals, they finally announced the start date would be december 5. this opens up china and the shenzhen market to outside investors. in shenzhen, heavy on tech companies and health care companies, which some see as the new economy for china compared to a state owned company. shenzhen names are an "window on china's domestic opportunity." limits is the same,
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about $1.9 billion, the northbound flows, and 1.5 been dollars for southbound flows. investors buying into shenzhen will be able to access any stock in the index and the shenzhen stock exchange. listedny company that is in shenzhen and hong kong, but for the initial stages, buying shares traded on the small cap gauge will be limited to institutional investors. the shenzhen composite is a volatile one. lost.ear so far, it has last year, a gain more than 60%. other movese been to open up capital markets this year, so this is just the latest one. tochina seems committed
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opening access to its markets. in february, authorities removed limits on foreign involvement in china's interbank markets. in september, bloomberg reported to qualifyines foreign institutional investors, allocations had been scrapped. this follows the msci engine rejecting adding chinese stocks on its benchmark, saying there barriers for foreigners interested in buying chinese stocks, so that was perhaps a setback in terms of china's aims to open up the market. the shenzhen link may not be as popular as authorities had hoped. shanghai, itt rarely hits the daily limit. , awill see if it is similar lot of samsung flows, especially
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the pressure of the weakening yen. they expect more southbound flows out of shenzhen, especially hong kong listed small cap's. also, of course, the currency as well. >> thank you so much. news.get to first word industrialt chinese companies accelerated as prices recovered. the national bureau for statistics says profits away fraction under 10%. steadyovery comes amid if slow economic growth that has weathered the imposition of government rolls to cool speculation in the property market. pressure mounting on the korean president with one of the biggest public protests in the country's history. organizers claim one million people gathered to demand she be arrested.
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police say 260,000 turned up. the demonstration came amid fors for her impeachment peddling influence and allowing a friend access to government. a new opinion poll has good news for the japanese prime minister. the ruling liberal democratic party at 60% for the first time since october 2013. it revealed nine out of 10 people surveyed say there is no need to pay more for u.s. military troops in japan. more than half oppose cooperation with russia. the death of fidel castro has prompted questions about the u.s.-cuba thought, donald trump reacting differently than the man he was succeed. aesident obama issued statement offering condolences to the castro family. donald trump tore into the former revolutionary leader, demanding a better deal for u.s. and cuba. fidel castro's funeral will be on saturday.
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global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. >> thank you. the price of oil could be volatile this week, opec making a last-ditch effort. we are following all of this, and that is a big event for the market. >> huge event risk. wti crude crew down 1.4%. clear ase is as looking into avenue barrel of crude. we have oil ministers scrambling, trying to convince russia to cut production. people trying to get to iran to cut production there also. let's talk about the hoped for opec and non-opec member nations. nations, a cut of 1.1 million barrels a day. nations, 600,000
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barrels a day, but there are disagreements with both camps. let's look at opec member nations and hop into the bloomberg, a cool chart you will want to see. you can see on the left side of the screen, iran, 3.6 8 million a day. of oil iran says it should not have to cut because it is recovering from sanctions. is the opec side of things. the non-opec side, that has to deal with russia. of 11 point 2 million barrels a day, near its post-soviet record high. opec, butt part of relative to saudi arabia, pumping 10 million barrels a day, the u.s. pumping 8.7 million barrels a day, you cannot discount what is happening with russia. no surprise that energy
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ministers are traveling to moscow to convince them to cut something, but so far, russia continues to say it will not cut, but could freeze production at its current level. opec member countries are not happy about that. >> because of that this agreement, we are seeing oil prices hit, but what happens to prices if opec manages to pull a rabbit out of its hat? that, we couldo see oil prices rise. according to the iea, they think it could rise on something like $50 to 60 girls -- $60 a barrel. i want to show you what is happening in terms of opec oil production as well as the oil price. the white line is total opec production, near a record, 34 million barrels a day on the top right of your screen. the oil price has been falling.
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of oneee an opec cut point one million barrels a day, 32.9 million barrels. was time we hit that, oil $49 a barrel or so. with the iea and some banks, they are more bullish. the iea is thinking maybe $60 a barrel, but with that said, they cast some negativity. that couldappens, trigger a jump in output by a u.s. shale, which could cause prices to fall back. goldman sachs bullish, $55 a barrel by the beginning of 2017. positioningrs are themselves there. opec members are building a lot of expectations and taking too much exposure to lead a deal fail, so may be about 48 hours left to see where oil settles out. if not, we can see this volatility spike on wednesday. repeat.ially could be a
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thank you for joining us. continuehead, let's our conversation on oil, especially when it comes to investing in energy. the challenges and opportunities facing players in asia. ask mcquarriell wealth management about the oil price next year. this is bloomberg. ♪
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"daybreak asia". i am betty liu in new york. >> i am sherry and in hong kong. setting aside more reserves to curb liquidity that threatens to stoke inflation. $75 billion after prime minister 1000dra modi and 500 and
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notes and ordered people to deposit their money in banks. leaders of the campaign to take the u.k. out of the eu have it a reported planned by the bank of england governor mark carney to negotiate a transition for british companies. the brexit leader called for a clear, clean, and stable approach. >> korean air fined $1.3 million for paying profits to its owner family. the fair trade commission says korean air sent offers to two units owned by the family by transferring profits, less commission. the report has been sent to prosecutors for consideration. checking the stock, down almost 2%.
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is making a last-ditch effort to finalize production cuts. -- next guest has a by call buy call, the division director of macquarie wealth management in sydney. do expect opec to achieve its oil price between that goldilocks own of $50 and $60 a barrel? > we are certainly not relying on an agreement. russia, given their large but deficit and reliance on income, so we think there may be an agreement. we have been seeing an improvement in the supply-demand balance, continuing to improve on the demand side and a reduction of supply. that dynamic will basically be
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in balance during the first quarter of next year. on that basis, we are looking for a higher oil price. there is no doubt that the price given u.s. shale producers, so we are watching closely. onrall, we remain positive fundamentals, and the icing on the cake would be a production cut or cap. ishow much of a threat higher oil prices for opec and that there are surviving upstart companies out there that made try to squeeze out of the market by lowering prices? >> we have seen right through this year, high-cost producers taken off the grid in terms of production. that is where of the supply side has started to improve. it's more around what the long-term prospect is.
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we are clearly not talking about $100 a barrel, more likely likely to see oil prices around that $55 level through 2017 and into 2018. those with a cost basis at reasonable levels can make money below $55 a barrel. you might see some peripheral production coming on stream. notes, soking at the you say by hong kong shares, buy china, why? >> we are certainly positive on china, some momentum gaining on the reflation story. we need to see more detail out of the trump administration and of tax cuts,e infrastructure spend, will start to see and be implemented. china will get some advantage
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from that. the other side, we are seeing reasonable numbers in the leading indicators, all picking up. the services side also improving in china. the pm eyes are well above 50 now. we have been positive for china some six months, but we see china exposure as key for a lot of clients at this stage when looking at their portfolios. note, it seems as if almost everyone believes that the fed will raise rates in december, so if that is baked into almost 100%, is there going to be any market reaction when that does happen? a great that's question. i would like to think there will not be market reaction. we've been talking for this about 18 months. i will be surprise, but markets do strange things. i think it is around what the
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inflationary expectations are going forward in 2017. we think it will be a measured approach by the federal reserve them up forecasting two additional rate rises next year, but there could be a third if inflationary expectations start to pick up from here. >> thank you so much. good to talk with you. division director at macquarie wealth management on the markets. much more ahead, the black friday weekend reveals a lot about holiday shopping. we look at the affect on cyber monday. we are getting initial numbers on how big that can be. that is next. this is bloomberg. ♪
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.> this is "daybreak asia" >> the early numbers for black , a focus on cyber monday.
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some numbers a few moments, at least $1 billion in mobile sales for cyber monday. su keenan is with more on this. let's run through what happened the last few days. is the we saw crystallization of a trend, more and more people doing cyber shopping, so black friday not as big as it used to be. what we saw is the shopping imp to an open. 40% in the brick-and-mortar, many shoppers focused on heavy discounts. 2015spent less than according to some surveys. he target ceo and chairman,
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says it was a great day. let's listen. >> i am optimistic about the consumer economy. it is a great time to be a consumer in the u.s.. the overall gdp growth is solid and will continue to expand. good movement in employment, low interest rates, low inflation, and certainly in food, deflation. >> let's go into the bloomberg. chart ofwill see is a the trend, fewer purchases, cheaper buys, and it confirms that trend out there where shoppers are looking for the sale. a third of the shoppers were looking exclusively for sales. online is the big story for monday. cyber monday estimated to see potentially 122 million shoppers. >> meanwhile, a lot of economic numbers hitting the tape. lot more ahead.
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what will be the most important ones? >> this is getting focus because the question is do they confirm what everyone seems to believe, 100% probability that there will be a fed rate hike in the december meeting, and the numbers according to economists surveyed are supportive of that. there is supposed to be an uptick in payrolls that will show payroll and labor is tightening. consumer spending forecast to rise, and manufacturing growth. briefly, cyber monday, what stocks should we watch? amazon, alibaba, and ebay are the big ones. we will see on line sales rise 9.4% according to those who are charging it. expected inbillion mobile, but 2.5 billion in sales. >> thank you so much. the latest on the shopping spree
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in the u.s.. coming up next on "daybreak indian central bank is doing to ease that countries cast -- cash crunch. this is bloomberg. ♪ seeing is believing, and that's why
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you wouldn't pick a slow race car. then why settle for slow internet? comcast business. built for speed. built for business. >> it is a: 30 in singapore. asian stocks backing up. oil prices are moving down. shery: it looks like it is little bit of a clear day. you are watching daybreak asia. let's get to the first round of news. the stock connect is now due to start december 5. regulators announced the date. years and will
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open up the mainland market. many companies are listed there. their are stepping up demands. it officially ended on sunday but there was a walkout out on tuesday. all pilots stopped work there. it has led to thousands of flights being canceled. it says the airline cannot survive is the case to the demands. presidentnch francois: will lead the party in next year's elections. pledgeers preferred his of tough economic reforms and traditional french values to lead the party. early polls show him strongly ahead. disney's animated musicals film on a has topped the north american box office raking in more than $55 million during its
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weekend. outperformed its other new releases. global news 20 four hours a day powered by over 2600 journalists. this is bloomberg. a bit of a fixed markets across asia. let's see how it is shaping up so far. no surprise, we are going to be starting off with oil because this is going to be the story dominating throughout the next of this week. it is looking like this. trading in new york oil down by one. maybe opecst time,
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doesn't actually need a supply cut deal. we are looking for more lines coming through but we thought would fall over 4%. it could stay ahead but this is in terms of that dollar. iss is the dollar index that taking some of the pressure off most of asian currencies. this is what we are seeing for the japanese yen, the stronger day. it is very much weighing on equities. we are seeing some declines coming through and we have seen this trading pattern recently where there are really following a but we will see it play out today.
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sydney down by 3/10 of 1%. it looks like japan is taking a breather from that. an incredible rally happening there. what is moving today? is it what we have seen taking a little bit of of breather. we have the biggest surge that course thatand of started the capitulation earlier this year. user some of the movers. -- canada has been breaking from the rest of it. by tenths of 1%. the dividend coming in as expected but it has been rated from underperform in sales.
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and whether it is going to meet it. we are looking at the minors when it comes despite that ramped up. thank you so much. no indian prime minister abused his -- used his monthly radio address that cash prices will soon come up again. at bankswinding queues that he remains confident. given that cash crunch we are seeing. it has moved india to a cashless society. he says that the benefit will a benefit season.
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never have until december 30 two exchange them for fresh notes. now we are about halfway through this transition. outabout 80% of those are of circulation. they are running out of smaller bills and these cash payments are no longer the way to go. holding at about $75 billion. this will introduce temporary measures to manage the liquidity. >> what are these temporary measures? >> the introduced instrumental cash reserve ratios that were set aside. likely be reviewing the decision on december 9 or potentially earlier.
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harmll stoke inflation and stability. harshme are calling it and we are expecting a reaction in bonds. that is set for the biggest drop since april 2009. it remains to be seen but we are confident. >> thank you so much. now china has been quietly hiking up these costs that reinforces their view that they have moved away from this stimulus. how has the people's bank of china been doing this. >> it is still tightening. this time they have been lengthening the terms and instead of using this market
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been cutting it and they are injecting funds through a 14 day transaction. and by 25 basis points. monetary they tighten conditions. it is still a little uncertain. >> the point here is to target andlacquer -- leverage there has been a huge buildup of leverage. they are using a lot of leverage
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to boost their return. this is why they know it is a very serious threat. they are discouraging the youth of leverage. >> basically what we seeing is that the central bank has in so what hasrates been the impact on the debt market. the return is likely to be lower next year. , youu look at the charts will see the spread has jumped already by 14 basis points.
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this is a big jump and we are already seeing some kind of a stretch. although they repaired within a day but it looks like investors will face a tougher market next year. >> this is a big issue and a big concern. thank you so much for joining us. it is early days for a big data but couldn't shake the way. he has more on this. it is great to see you here. and whatnerating this is being done with it. >> the important thing to realize is that this is an online economy.
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everything from job search to shopping, it can be seen taking place online. , there is any bob opportunity to collect that data to what we are seeing so far economiesn the transition. >> given how difficult it is, how quick will it be? >> our view is that the data is more reliable. the official data is internally consistent but our view is that the more data there is the better. this is thatue of
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it gives us more height frequency than the official data camp. >> can we trust it? awaye point that we take is that the official numbers are telling of broadly consistent story. both the official data is telling us about a transition and we think it gives it a relative idea. tom, thank you so much. much more ahead. prospects joins us now on
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daybreak: asia. daybreak: asia. a quick take on the latest business headlines. sayingollowing a report that the fukushima nuclear plant could be this way. it says the combined cost of continues to rise. the plan was devastated march 2011. it is not cause any new damage. and the company
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already manufactures this big-ticket medical care that it could grow twice as fast. and software currently accounts for more than $3 billion. mitsubishi has recalled 25,000 vehicles from december 9. 21,000 suvsnvolves built from 2010-2012 that could have problems in their rear doors. it will be recalled in march over defective airbags. now energy will be high on our agenda this week with a critical opec meeting. runs clp.uest
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power to 80% of hong kong. joining us now we talked to richard lancaster. good morning. how closely do we watched the opec meetings and where do you think this one is headed? >> we look very closely at the oil prices. buto not consume much oil we do consume a fair amount of gas. it tends to be linked with oil prices. they are very volatile and we look to diversify as much as possible so we don't have to much exposure. let's talk a bit about nuclear power. he submitted a bid last month. it and concerned over what updates can you give us on this bid and where you plan to take it. >> to go through the regulatory
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process in the mainland. longer term we see nuclear power as being an important part of the energy mix. they are needing to transition from fossil fuels to clean energy. transitionof china's and we do see that it is a part with and we're comfortable the partnership. it made a lot of sense to put in a bid. the electricity demand in china picked up in the third seener but overall it is slowing down. are you looking for other markets to expand. do see china as an important
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part of our growth. we are bordering on china and are in interconnected today so it is a very important growth market. same levelseeing the of growth as we had in the past. we still see the long-term prospects as being very sound. areactivities that we see transitioning to clean energy. been in renewables and hopefully more investment in nuclear power as well. let's talk of it more about some of the projects that are on the docket including that gas fire. >> it seems that richard can't hear you at the moment. let me continue the conversation we will have him join in soon. you talked about renewables.
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is there a goal here. how much of a percentage of it is for your business right now. >> it is around 17%. 20% by a target to hit the end and that is an interim our portfolio. and renewable energy continuing to build it when fossil fool power stations need to be decommissioned is important. close it down without compromising energy security. place. to have it in intoving away from coal natural gas. you have been talking about building one.
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>> that will take about 18 months in hong kong. the floating terminable that we have is based on technology that is quite mature around the world. land is fairies fears. he gives us an opportunity to save diversify. it is much better than having just one that we currently have. it enables us to have better pricing so we can access gas from all over the world. will bring huge benefits to hong kong and we are pushing this as we can. you so much for joining us. that was the ceo and coming up takeoverew possible
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gives shares of boost. details are just ahead. this is bloomberg. ♪
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>> this is daybreak asia. i'm betty lou in new york. and i'm sherry london and hong kong. what are you looking at? >> we are starting off with things that are happening that
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comes to hong kong. the kickoff will be next week and jpmorgan is suggesting that will improve corporate governance and also suggest that it will be more of the success. that is all coming up at about 9:40. looking at also what is going on with the oil market. aroundf news swirling that is suggesting that if we get success, we could see oil going up to the 55-60 dollars a barrel level. no deal on the table. we have oil prices at about $30 a barrel. us.ill be joining finally last but not least, one big winner from the donald trump president is the japanese --sion fund, 1.2 billion
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trillion dollar one is having a great leave. the beans that there is more good news on the way as well. .alking about that, >> a lot happening in the hours ahead. now australian gaming company is jumping at the open and you can see that. let's get over to paul allen in sydney. what are we talking about and what that mean? the plan has gone out the window a little bit. that was viewed as a first step ahead. the views are creating a pan but itian merger
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would've been worth $4.5 billion. it has hired advisers to prepare but it is not the first time since these two companies. this news has had a pretty and it is a lot better than 3%. is almost up 1% but if you analyst views are coming in as well. it but itould appease does warn that it could be a difficult fight because of the size. >> thank you so much paul. that is it from us with plenty more still to come. sherry, i wanted to leave you since we're going from black
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friday sales to cyber monday sales. guess what the most-watched deal is? it is the mermaid tail blanket. it is apparently the hottest items that people are looking at. wake up to this and are their christmas tree. like it you can actually wear as a jacket. i love it. who would have thought? thank you for watching. up next, we are counting down to several market opens. the nikkei goes down for the moment. this is bloomberg. ♪
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♪ rishaad: it is 9:00 a.m. in singapore. i am rishaad salamat in hong kong. this is "bloomberg markets: asia." ♪ rishaad: taking stock, the hong kong-shenzhen link will start after a two-year delay. china quietly raising borrowing costs, moving away from monetary stimulus.


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