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tv   Bloomberg Daybreak Australia  Bloomberg  March 26, 2019 6:00pm-7:00pm EDT

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haidi: welcome to daybreak australia. shery: i'm shery ahn in new york. sophie: i'm sophie kamaruddin in hong kong. we are counting down to asia's major markets open. ♪ haidi: here are the top stories we are covering in the next hour. stocks rally and treasuries fall again, with signs of easing. oil with energy gains as the s&p 500 surges. apple faces a partial iphone ban after losing a patent ruling against qualcomm but escaped punishment in a separate case.
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and china and europe pledged to defend global links as trade talks resume. president trump sees an excellent deal. shery: later, we will speak to the president of australia's synthetic lucy. let's get a check of the markets close in the u.s. we saw u.s. stocks and treasury yields gaining ground after two sessions of losses. every sector in the s&p 500 was in the green. on more hints that russia may stick to a commitment to cut output. we also saw the dow gained 6/10 of 1% and the nasdaq rally 7/10 of 1%. goldman sachs advising against panic of inversion of the yield curve, saying that stocks could do well even with a flat curve. it was risk on sentiment in the u.s. see how we are setting up for asia. sophie: investors are easing their concerns over that yield
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curve inversion, we are seeing a bounce back in asia looking set to continue with futures pointing slightly higher. with with few data points industrial profits due in the morning. the first china's banks due to report along with air china. in australia, we will be watching banks as we wait the parliamentary testimony from the chief. research companies in view after iron ore and gas ports reopened in western australia. also news that coal projects of dbt included in the government projects to strengthen australia's energy grid. building product makers like james hardy with exposure to the u.s. on the back of new homes commenting on february. quickly checking in on the kiwi dollar. hovering around .69. yields are holding steady after this drops we have seen for the
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benchmark ahead of the rba policy decision. 1.75% expected from the central bank of new zealand. haidi: sophie kamaruddin in hong kong weather set up uof of today's trading action. : president xi jinping has pledged to work together with multilateral trade and improve global governance. a joint statement says upholding international ties is the best way to tackle common threats and boost world prosperity. the eu is china's biggest trading partner and wants to solidify the relationship while pressuring beijing on its trade practices. president trump border emergency survives as the democrats in the house failed to override his veto. their 248-181 win was short of the two thirds majority needed to overturn the president's veto. most republicans backed the president despite widespread
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unpopularity. the emergency status to redirect money from military funding already approved by congress. boeing says it will submit a the tooftware fix for the faa by the end of the week and said the update has been flight tested. however, china's aviation regulator has suspended its own airworthiness certificate for the max. beijing says it makes the make his own review of the proposed software fixes before allowing the plane to fly again after two recent fatal crashes. china's former top internet regulator has been jailed for 14 years for corruption, completing the following official who mingled with apple, facebook and other big tech. he was convicted of taking bribes worth more than $4 million from companies and executives seeking help with regulatory issues. and also for promoting the business is online.
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he was convicted in china after a one-day trial in october. and the pentagon says it successfully tested the first intercept system using two missiles to destroy incoming rockets. they were fired from southern california and hit the target far out over the pacific. the defense system has been operating for more than a decade, but this is the first on the pentagon has tried to use multiple rockets to destroy a single target. day onnews 24 hours a air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm jessica summers. haidi: more now on the advancing u.s. stocks thanks in part to a note from goldman sachs, easing concern about the inverted yield curve which is normally a warning for recession. su keenan joins us now with more. goldman sachs saying u.s. stocks could do well despite that flatter curve.
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su: it is true that that was their message. it was sort of a don't panic message and the market seemed to relax and stocks rallied for let's go to the snapshot. close fade a bit by the but we saw the dollar racing its monthly loss. gaining in gold fell. oil back near $60 a barrel. that helped prop up a lot of the oil stocks. let's take a look at -- take a look at some of the big issues. that is the yield curve. go into the bloomberg and you can find the library of charts. you will notice that the curve has inverted for the first time since 2007 which was right before a recession. the focus on this is yes, it does seem to stage a procession -- recession but goldman is saying not necessarily so. the yield curve is starting to get. usually it is a deeper yield curve over a longer time. they say the conditions are different. in a lot of international buyers.
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they believe stocks will do well and there will not be a recession. apple was one of the big movers. there were two separate decisions on patents where qualcomm has been battling apple. qualcomm won the first decision which came out in the regular decision where a federal trade apple infringed on a patent and older iphone model should be banned. bed bath & beyond up in a huge way. at one point up 30%, the most in 19 years. several activists funds are said to be interested in replacing the board to get it to respond more to online retailing. let's go after hours with a second apple decision coming out. apple dodged a bullet. it escaped a, import ban in the second ruling so they are contradictory in some ways, although the first ruling does allow qualcomm to have some kind of leverage in any settlement talks because there still could be an import ban in that first
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decision. haidi? haidi: su keenan with a look at the overnight trading action. that get more on the apple story, the pair of conflicting rulings. showing the depth and complexity when it goes to this ongoing legal battle. ian king has been following this case for many years. let's go through these latest rulings. what were the case is, what happened? what are the implications? ian: as su just said, two basically similar cases running in parallel, but one a bit further along. the one that was further along, the one that could have brought about a curtailment of shipment into the u.s. of the iphone was shut down by the itc. we have the other one we heard about earlier today basically passed a stage in the process and will now go in front of the full itc. they will basically make the same decision or a similar kind of decision that they may today,
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which could result in a ban of the import of the iphone. qualcomme we expecting to appeal these decisions or apple to do the same? this was one to one sort of tie when it comes to these decisions today, right? ian: it kind of was and it kind of wasn't. there at a different stage. this process, it is not like a jury trial. it is not like the trials that these guys are involved in in other parts of the world. so, it does not really follow the standard process. it is more of an administrative process. i don't know if we're looking at it from the point of view of it being appealed as the right way forward. what you are doing is trying to achieve basically the threat of something, which you then use as a negotiating tool. these latest disputes have been a sideshow to the broader fight between apple and
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qualcomm. who is coming out on top on that? ian: if i knew that, your guests is as good as mine. the way to look at it is let's look for the next big signpost. you will remember that the ftc, another government agency in this country, took out an antitrust case against qualcomm, accusing it of misusing its position to extract licensing fees. that is similar to the case separately that apple brought against qualcomm. the judge in the ftc case is actually considering her verdict right now. as far as we understand, that could come at any moment. that would have a significant impact on the way these things are going. who knows? there are cases all over the world. really, what we are looking for is that one kind of big blow to be landed that might fall -- cause one side to blink at the negotiating table and give ground. haidi: ian king with the latest
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on apple and qualcomm. that battle ongoing in san francisco. m&a news in australia, a rare, won't be engaging with the proposal on its current terms. the company says the decision was made after evaluating the nonbinding bid. the conglomerate offered $2.25 a share in cash for lynas a mining company in australia that mostly ships to malaysia for refinery purposes. that was a 45% premium to the last quote and what have valued the company at 1.5 billion they will not engage with west farmers on that proposal. they have been dipping into that massive war chest on the sale of some of its coal assets to engage in acquisitions. the lynas deal looks like it will not be going ahead. still ahead, mark butler joins
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us with the next lose it interview -- an exclusive interview. shery: next, theresa may's deal is better than no deal. that is the thinking as hardline brexiteers shift towards supporting the prime minister's plan. this is bloomberg. ♪
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haidi: we are counting down to the citi open. following some of the gains in wall street as the rally in treasuries takes a bit of a breather. shery: you are watching daybreak australia. the brexit drama rolls on later with the house of commons debating what to do next after seizing control of the process from prime minister theresa may. one conservative mp says he thinks she is on her way out of downing street even sooner than some expect. >> people are asking me how long is she going to be here?
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not only do i not think she will be switching on the christmas lights at number 10 this year, but i doubt she will be giving away any easter eggs as well. will vote onment alternatives to the deal on wednesday. we can discuss this with marcus. great to have you with us. we also heard from a brexit hardliner that while he did not like the prime minister's deal, it was better than staying in the european union. is may's bet going to pay off or is this too little, too late? marcus: it is funny because the bet is one that has been going through a 33-month gestation period and we are now looking at the clock. we are counting down. so what happens now that parliament has rested the timeline and the clock for what brexit will look like is actually going to apply pressure on those who are opposed to amaze deal suddenly taking a second look at it. shery: we have now seen
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parliament take over control of the process, at least through those indicative votes. what options does this open that we did not have available earlier in the week? markos: every option. that is what is so amazing with this process. before, it seemed like it was a limited set of options, but right now everything under the sun seems to be on the table because that is what these indicative votes will tell us. they could include the revocation of article 50. no deal is perhaps a possibility. but what i think the process will likely push for it something much more closer to a soft brexit. we will see. this is really just an unprecedented, unpredictable dynamic, real-time event that we are observing. haidi: great deal less uncertainty it seems. over the weekend, we had the extraordinary turnout of the anti-brexit protesters in
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london. does that force the government's hand in pay more attention to the fact there is a large part of the population that would want a second vote? markos: we have always known that has been a large part of the population that wants to be there remain or another large part that wants to leave. it was a 50-50 vote in essence with the vote winner being the leave campaign. that split has existed over these 33 months. what we are seeing now is the end game. those people in the streets, the nearly 6 million signatures to revoke article 50, all of these things are intended to put pressure, as is parliament now resting that decision-making and that indicative vote process from theresa may's government. haidi: where does this leave the eu then? we know from the european commission, they have admitted it looks like a no deal or hard brexit could potentially be more
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likely following all the uncertainty we have seen over the past few days and weeks. we know the eu in terms of its economic position does not want a messy brexit either. markos: nobody wants a messy brexit, except for those that are opposed to the power of the unified european union. to the power of a sovereign, soft or at least managed brexit britain. those who wish to see this process as messy and as chaotic as it currently is are the winners. those who really prefer predictability, a managed process, some sanity to the politics of the u.k. where in fact you don't have this divisiveness, where you have some level of respect for the political process are those who are really left out on the sidelines. really appreciate your time. hoover institute visiting fellow
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joining us. joining us next, after australian fin tech startup achieves a $1 billion valuation, we will be joined by the unicorn founder and president. this is bloomberg. ♪
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haidi: this is bloomberg technology global link. i'm sharing out in new york alongside haidi stroud-watts and emily chang in san francisco. shery: let's take a look at the top global tech stories. emily: apple has escaped it possible import ban of its iconic iphone. the decision comes after a u.s. trade agency rejected a patent infringement claim filed by qualcomm in the second of two cases before the international trade commission. earlier today, a separate itc judge said that apple infringed on a different qualcomm patent and recommended a ban. mcdonald's is spending more than
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$300 million to buy decision logitech company dynamic yield. it will allow the biggest restaurant chain to vary their electronic menu board display of items depending on things like the weather, the time of day, regional preferences. the menus will also suggest at on items to customers. adobe's running a strategy to win more custom -- corporate customers. the company announcing a new software system called experience platform. it will unify business applications that have been added in different acquisitions and connect them with new apps from third-party developers. it echoes the salesforce strategy of acting as a data hub. those of the global tech stories we are watching. haidi? haidi: the an australian tech uniform is part of an exclusive club. they were only two other members of until this week. the latest tech startup to enter the billion-dollar valuation
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club after it concluded its latest funding round. the president and cofounder of airwaleex joins us. from what we understand, the company was born out of two things. one is coffee and the other is the university of melbourne. how did it all come about? lucy: well, we are founded by four university of melbourne colleagues. we worked together before and friends back in uni. two other founders opened a cafe prior to finding -- founding airwallex. two of the things that are very dear to us. haidi: it is a cross-border fin tech platform. what sets you apart from competitors then? lucy: so, i think the main thing is we are very comprehensive. we cover anything from money coming in, fx, and pay out, as well as we are looking into
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acquiring as well as issuing. competitors, most of them only offer one or two parts of the value chain. emily: have you encountered any pushback from the traditional financial industry? lucy: sorry, what was the question? emily: have you encountered any pushback from the traditional financial industry or big banks? well, we work with banks tremendously in our building up the payment network as well, but i would not say we are disrupting their existing business model. we are working very well together, as well as improving the customer experience and helping them achieve a better product as well as a platform
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experience down the track. emily: what are the plans for global expansion? currently are, we focused but have open our london office. we have our emi license late last year. we also opened a san francisco office in the middle of last year as well so we are very interested in expanding into europe and the u.s. region. haidi: what is your biggest australia'scoming third uniform? -- unicorn? lucy: i think the challenges are still trying to be a global business. we were a global business from office andt eight 260 employees globally. it's still difficult to understand the different cultures, regulators as well as the customers in each region.
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we try to be as localized as possible, but there are a lot of challenges that we are facing at the moment. that could be opportunities down the track as well. haidi: the residence of interesting but fairly discouraging research that we reported suggesting that rbc's and funds treat female founders and startups founded by female entrepreneur is definitely when it comes to funding for their male counterparts. is that something you have encountered as a female entrepreneur and start up? lucy: i think the most important thing is how well you know about the business and the industry. if you can demonstrate your ability to be a great founder. it does not matter what gender you are. females have some strength that males do not really
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possessed in a lot of ways. i work with a lot of software engineers and nothing we work very well together egos of the gender difference. -- because of the gender difference. haidi: it is a pleasure to have you on with us. lucy liu joining us from shanghai. shery: that is bloomberg technology global link. don't miss bloomberg technology at idiom in sydney, 5 a.m. in hong kong and 5 p.m. in new york. next, europe struggles to have a united position on china as president xi jinping suggests they suggest trust beijing. this comes after the $335 billion airbus deal in france, not to mention italy became the first g7 country to sign up with the initiative. we have the details next. this is bloomberg. ♪
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haidi: markets open for the trading session and 30 minutes. features shaping up about 2/10 of 1% as we had u.s. stocks supporting the rally in treasuries. it did end the session higher. apple specifically. i am howdy stroud-watts. shery: it is 6:30 p.m. in new york. let's get the first word news with jessica summers. jessica: trade talks resume this week with president trump again pledging an excellent deal. top negotiator robert. lighthizer and steven mnuchin flight to beijing for talks on thursday and friday.
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the counterpart will travel to washington next week. the u.s. is concerned that china is backtracking on earlier pledges while beijing is pushing back a proposal it sees as one-sided. two new bloomberg surveys chose the pboc easing less aggressively for the rest of the year while maintaining study liquidity. the estimate of 29 economists say policymakers will continue to reduce the amount of money lenders must keep in reserves. the earliest cut is expected next quarter with two more in the second half and three 50 basis point moves. israel moved tanks to the border of gaza after threatening a powerful response after rocket attacks. if follows a night of violence as the it's really air force bombed targets across the gaza strip and militants continue their missile strikes. the violence comes two weeks before the israeli general election, although hamas has vowed not to escalate the tension.
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and reports from tokyo sinking nissan paid the tuition fees for all four of carlos ghosn's children when they were at stanford between 2004 and 2015. we are told that was part of his employment contract after he became nissan ceo in 1999. valued atave been more than $600,000, according to stanford's published fee schedule at the time. global news 24 hours a day on air and on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. shery: let's get straight to the market action. sophie kamaruddin in hong kong. how are we setting up for the asia open? sophie: asian stock investors tiptoeing back in after the heavy losses we saw at the start of the week. futures hinting at slight gains following yesterday's rebound.
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recovering from all of its monday loss. the mood was different in china. the shanghai composite with its today slump in more than two weeks and may be precaution with today's session with u.s. futures nudging lower. a quick check ahead of the index policy decision and before we get commentary from the rba. the aussie dollar nudging higher by 1/10 of 1%. buying against the qb dollar which is seeing that cost holding your a five day high. expecting the aussie cross to be below 1.06. onis likely to be 1.02 expectations the rba will deliver two rate hikes. flipping the board for stocks to watch in sydney. keeping and i on lynas. the stock is to resume trading as it will not engage with wesfarmers on its highly conditional takeover offer.
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it did jump 30% in the wake of the bid. 3.5%,mers saw a slide of the biggest fall. we will see how we get investor reaction for the latest news on lynas not engaging. shery: thank you for that. breaking news -- apple responding to the idc decision earlier today saying that apple is pleased about the decision on qualcomm. we know that apple escaped a possible import ban of its iphone after the u.s. international trade commission rejected a patent infringement claim filed by qualcomm. apple saying qualcomm is using these cases to distract from business practices. apple is also saying it is looking forward to presenting its case in san diego. we know that earlier today, there was another u.s. itc decision and the judge in that case saying that apple had infringed on another qualcomm patent and some imported iphones
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should be blocked from the u.s. apple now saying it is pleased about the itc decision on qualcomm where it was not banned from importing iphones into the u.s. haidi? haidi: let's take a look at how trading will get underway in asia. let's take a look at what to expect with adam. we saw the pause in the treasuries rally overnight. taking a look at the relatively attracting stocks with equities versus bonds towards the prism of the fed model and earnings. is the earnings yield positive enough or attractive enough to make that argument? adam: i think it is a question of whether you believe that bond yields have been collapsing because of imminent of the recession. some parts of the yield curve are inverted, we are aware of that, but it has a great -- increase the relative attractiveness. the chart shows it pretty clearly.
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you can take this back over a number of years and look and how it tracks over the average. it is pretty decent at the moment. that is what the bulls in the equity market are saying at the moment. we have been hearing from jim. he has been in the market for a long time, he has seen many cycles. he says we now have is wall of worry being built into the market. the market is concerned about recession fears. we still have the concerns around growth and trade worries and what have you. and then you have this right here, an indicated that is telling you if interest rates will be on hold, you want to be earning stocks that are relative attractiveness relative to some fixed income or even cash at this point. it is an argument you are hearing from people on the bullish side of the equities side. acknowledge the re-rating of equities, that valuations have come down to reasonable levels, not stress level, and incrementally want to keep
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adding to their stock portfolio. shery: many investors say it is all about central bank purchases and the inversion needs to be deeper before it is a recession signal. does that hold weight? adam: of course, that is the difference about this cycle. the level of unprecedented central-bank action and buying up bonds as men yields are being suppressed the levels that have never been seen before and we never unwound this before. this chart shows you kind of the premiums on 10 year versus two-year and three-month bonds in the u.s. clearly, you are getting that kind of concern around the recession. but it is really the case -- the folks at principal global are making this argument. they are saying it is about the depth and breadth of the inversion. we have had this ten-year inversion. if you look through the curves, you are not seeing kind of real
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early recession warning signs to these guys. they are pointing out that if you look through the curve, there was quite a bit of steepness. you should take this at face value and think everything is going down the drain and you should just kind of bailout of equities at this point in the cycle. there is a good chance this thing could extend for a significant time. the fed is very much on hold at the moment and that does that -- does lend some support. this argument is still very much a divisive argument in the markets at the moment. shery: we have seen past recessions have taken time from the inversion of the curve. thank you so much for that, adam haigh. you can find adam's charts on the go library on bloomberg. president xi jinping has wrapped up a short tour of european he pledged to work together to safeguard multilateral trade and improve global governance. the eu wants to present a
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coherent strategy with china, while at the same time concerns about china's increasing clout. tom mackenzie is in china. we have heard essentially from president xi selling european leaders to relax, that you cannot always be guarded against each other. how is that message taken? message as you say from president xi in europe was one of trust us. aside the suspicions you might have, worked with us and cooperate with us and you will win dividends on the back of that. this is a message that has been hard to sell over the last few days amongst some in europe given that there are concerns from the european union around things like predatory investment from china and many of the concerns of the europeans shared with the u.s. in terms of the access to the market, the unlevel playing field as they see it and the pressure that is
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put under some of their companies that operating and the lack of access they get. not to mention the human rights issue. this is a president who signed up on the internment of one million of his own citizens. a number of issues that the european leaders will have to be wrestling with an has to be wrestling with during this visit. this is an attempt by president xi along with 500 executive officials and journalists to win over european critics as the chinese remained in a trade war with the u.s. of course, money talks. you see the deal with the french around the 300 airbus aircraft. they signed billions of dollars of deals with the italians and french as well. haidi: we know there has been criticism and controversy over italy signing on. is europe able to present a united front to president xi? presidentis something
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macron of france was really keen to do. he said we need to have the europeans a united strategy,. we need to be united -- unified when it comes to dealing with china. we had a report out from the european commission saying that china is a strategic threat, competitor and a challenge to the global trading system. but the reality is when it comes to the divisions within europe, they are highlighted by the belt and road initiative. of until the last week, europe had not signed on to this. as a body, it still has not but it really did sign up for that belt and road initiative. there are chances the austrians might follow suit. there was some disagreements among european leaders over this initiative. we had the french telling the italians and east europeans they were getting too close to the chinese. the chinese will turn around and say the french have got twice as much with the chinese. the germans are the largest
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trading partner with china. that disconnect between some of the leaders in europe remains, but as we said, the european commission, president macron and jean-claude juncker are trying to portray themselves as having a unified approach but deep down there are divisions. wei: tom mackenzie in -- will get back to him throughout the course of the day. he is covering the flooorum. great guests coming up with tom. with us in one hour. after that, we will be joined by the u.s. chamber of commerce executive vice president. coming up next, iron ore watchers waiting for production guidance as it struggled to recover from january's deadly dam spills. that is coming up next. this is bloomberg. ♪
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haidi: the fatal dam collapse in
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brazil in january continues to weigh on the world's largest iron or producer. valer has not provided full-year guidance in its latest orderly release. david stringer joins us now from melbourne. do we know more about the impact of that january disaster? it was a really knee-jerk reaction. is it likely to be sustained? we are getting a little more clarity but the crystal a lot of moving parts. vale's operations and their ability to bring mines back on an even a legal perspective. position,o reverse a hoping to bring back one of those mines that was brought off-line. there are certainly uncertainties here. what vale said tuesday in brazil is it had to shut are in about 93 million tons of annual capacity. that is equivalent to about a quarter of its production in
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2017. certainly, significant. as you say, what analysts have been hoping for and what the market has been hoping for is more certainty about the outlook. how much will the actual impact be on 2019 output. morgan stanley expected to be quite dramatically lower than a year earlier and sees the overall impact as tipping the iron or market into deficit this year. shery: why does vale hold back of offering guidance for the 2019 output? david: at this stage, it is simply too difficult and uncertain for them. it really remains unclear. which mines have been shuttered. brazil ordered vale to close down various mines with dams similar to the operation that saw the deadly disaster in january. at this point, they don't know which operations will be back up and running and when, and how much that will impact production. how much they can offset by
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lifting output of some of the other operations. haidi: i want to get the latest on another story we have been working on which is wesfarmers attempting to dip into a treasure chest of cash in acquisitions. it had ambitions that are over before it even started. david: let's see. wesfarmers making a play yesterday for lynas. this could well be, as analysts have been saying, an opening shock and a potential battle for lynas who has a mind in australia and giant processing plant in malaysia. the offer it seemed quite opportunistic and possibly too low. lynas saying they are not planning to engage with wesfarmers at this stage. plenty of petition that other bidders will now emerge. shery: thank you so much for that, david stringer.
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coming up, our exclusive interview with australian shadow minister for climate change and energy. hear from mark butler on the issues around energy policy as we head towards a federal election. this is bloomberg. ♪
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haidi: australia has experienced its hottest summer on record as the ease qs continues to suffer through the worst rout in recent history. in a political sense, that he will not be easing any time soon. energy policy said to be at the heart of the federal elections in may. the man leading the charge for the labour party is climate change shadow minister mark butler joining us. great to have you with us. i found it interesting, combined with energy policy and climate change policy. issues the coalition government seems to struggle with.
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what does it say about your priorities? is one more important than the other? mr. butler: we took the decision several years ago to combine the areas of climate change and energy because we found that whenever we try to do climate change policy, we were bumping into energy and vice versa. all of the energy users and suppliers themselves but the view clearly to us about the future of energy being simpered -- severely impacted by climate change policy. bringing the two together we thought was a similar environment for investor confidence back into policymaking. haidi: you are heading into the election to cut greenhouse gas emissions. there will be losses and adverse along the way. what is your plan to try to negate some of that? mr. butler: we want to implement that policy with the lightest touch possible. we have been working very closely with industry that would be directly impacted by policy
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impacting -- policymaking to make sure that we have access to international. the business is allowed to trade in international markets, access that was cut off by the current government years ago. that we have access to domestic offsets. this task is made as easy as possible. i make the point that 45% was the minimum cut in emissions advised to the parliament by the climate change authority. this is a very important decision for the current australian parliament to make for future generations of australians. shery: parts of the business community have voiced concerns about these omission cut targets being too deep. are you concerned this may deter some from investing in the energy sector? mr. butler: we have seen particularly over the last couple of years that australian businesses and businesses around the world have recognized that
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as a result of initiatives like the task force on climate exposure, they're going to start to have to prepare with consistent of keeping global warming below two degrees. our target is the lowest possible target consistent with keeping global warming below that important threshold. we have seen modeling in australia that confirms gdp growth in the 20 20's will not be materially different between the target proposed by labor and the target proposed by the government, which we think is an inadequate target. that is because the decoupling of a missions growth and gdp growth over the past couple of decades. shery: what would you tell our audience, largely the business community, of how he would work with them if you become the next government? mr. butler: over the last few years, particularly in climate and energy policy, we work very closely with the business suppliers as well as big energy producers.
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power and gas prices increasing dramatically and concerns of the right -- reliability of the system. what they need more than anything else is investor confidence. they need a national energy policy that will be stable, and during, that will last a long time that reflects their asset marks, but also will reflect the comment -- climate imperative that is being reflected by investor demand. haidi: that may get some confirmation on you on policy. can you confirm the policy will not be using any carryover credit or accounting trickery to meet emissions projects? mr. butler: it is likely to be called in australia in the coming weeks. we have made it clear we will release the climate policy before the election. our position on carryovers will be part of that announcement. we need to get genuine emissions production in australia. we are taking submissions from a wide variety of stakeholders about this question of
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carryover, but we're interested in genuine emissions production and not accounting tricks. haidi: there is also the issue of how much electricity is being generated by coal. 70% at the moment. by 2030, where with the labor government see that number being? the morris government saying they are having feasibility projects on a number of new thi ngs, such as coal. is that in line with what labor would potentially do? mr. butler: there is no doubt get awaycoal will not in australia without government subsidies and we are against government subsidies. an indemnity against future carbon risk which the australian industry group has suggested it will be as much as $17 billion. we don't support that sort of subsidy to an uneconomic power system that is inconsistent with our future climate imperatives.
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our position is get more than 50% renewable energy by 2030. between coal and gas and so one. it really remains to be seen over the coming decade but we know the future of energy generation investment in this country will be renewables. haidi: you have taken a tough stance on even your boss. does that go against the traditional union position in the labour party? mr. butler: i have tried to contextualize the idea of establishing what is happening against the cold market around the rest of the world, particularly in key markets like china and future markets like india which has been really the basics of the decision to open up the coal mine. from my view, i think the coal market in a couple of decades will decline in line with international energy. projections of what will happen with the two degree scenario. any decision-making coming from
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the government over other projects that matter would be taken according to the facts as we understood them at the time, the state of the law at the time and we always have clear eyes to any risk potential. talkingery quickly, about how fractured politics have been. how do you get past the policies to make sure they are investable new energy projects? mr. butler: the australian industry group was out this morning calling for the australian parliament to put in place an during, stable energy policy. they recognize as all of the community does that there is still a divide over levels of ambition around climate change. what we do need is some stable rules to guide investment in our energy sector beyond 2020. 75% of that current generators are operating beyond their design mark. we need substantial new investment and it is time the australian parliament put in place some bipartisan rules to guide that investment.
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haidi: thank you for joining us, mark butler, australian shadow minister for climate change and energy. next withaybreak asia the market open. this is bloomberg. ♪
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>> a very good morning. i am haidi stroud-watts in sydney. >> good evening, from bloomberg's global headquarters. i am shery ahn. >> i am sophie kamaruddin in hong kong. welcome to daybreak: asia. ♪ >> our top stories, caution seems to be the word as markets head to the open. u.s. markets trading above 110. apple facing a partial iphone ban


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