tv Bloomberg Markets Asia Bloomberg July 13, 2020 10:00pm-12:00am EDT
cases in hong kong triggered tight social restrictions including mandatory masks on public transport. the u.s. and china ramping up tensions yet again. washington rejects beijing's claims to the south china sea while top u.s. senators are facing mainland sanctions. those trade waiting data numbers coming out from china. could come out any second and we will bring them to you once we do. here we go, we actually just got them. export numbers rising 4.3% for june, a beat from what alex -- what was expected. seeing more signs of improvement from the previous young -- previous month. rising 6.2%. economists expected a contraction of 4.7%. perhaps some signs that domestic demand is coming back. external picture looking better as well. we will wait for the dollar terms but so far, so good when it comes to the figures. take a look at the markets. we are wobbly this morning. u.s. session falling lower. the u.s. has trade tensions with
china, the u.s. rejecting china's claims to the south china sea. china than sanctioning u.s. officials like ted cruz and marco rubio. u.s. futures are pointing higher. we are also looking at what is going on with the virus as well as states like california reversing its reopening plans. u.s. ten-year year, bonds up. u.s. ten-year. we saw the dollar gaining a bit of steam against the yen, but seems like we are reversing some of that. let's look at the boards and watch were chinese markets are going to see any reaction to the trade figures. we saw a bit of a pause in the risk rally when it comes to mainland equities, after we are seeing equities inching toward that $10 trillion milestone. flip the boards and see what is going on there. small-cap, those rose to follow -- five year highs. we have basically been flat the last 30 minutes of trade. shenzhen stocks have been on
fire. hang seng down 184 points right now. also with the city introducing the toughest virus measures since the pandemic began. taking a look at when it comes to other markets as well, indonesia just coming online. watching singapore very closely. seems like we are paring back losses as well after the really ugly second quarter gb numbers. circuit breakers were eased during joan -- june because to show how deep the contraction was in the second quarter. shares down .5%. .66%.i lower by before we go, take a look at currencies. we mentioned the dollar, slightly firmer but we are seeing here some weakness in the offshore renminbi, hovering around the seven handle. korean yuan also is weakening to 12.0643. brent sliding as we get closer to the opec-plus meeting, as well as jitters with the u.s.
china trade tensions. 10 year yield at 303. haslinda: china's stock market is on a tear, fueled by a relaxed monetary policy in group for a an expectation strong economic bounceback. now approaching a valuation of $10 trillion, last seen just before the stocks crashed in 2015. joining us on is goldman sachs chief apex equities strategist tim moe. tim, good to have you with us. inching towards that big, big number, it does seem like authorities are dining it -- guiding it. and as long as it does, you're not likely to get burned. tim: that is our view. we do think there is further upside in the a-shares. we published a piece last week calling for another 15% upside in the next three months.
although we do think that when the liquidity-fueled upside subsides on a one-year view, we think that the market would be levely around the current if it returns to more fundamentally-driven valuations. the underlying message clearly in the near term is that the market has a lot of potential for further upside. as you said, driven by accommodation of improving fundamentals and amplified by enthusiastic retail and investor participation. haslinda: a lot more upside. they said they read -- they see rotation from tech to other sections like financials. is perhapsew somewhat different than that. we still very much think detect en force. our tech analysts published a 450 page report suggesting there
is significant upside remaining there. we think as far as strategies go, the three key generic once we would advocate for with a-shares, the first one is the china bap basket. this is one where it is basically the foreign investor favorites where the underlying fundamentals are attractive and we think investors will continue to focus their efforts. that is number one. two, we look at how typical rallies have performed. that phase, things like brokers and auto and property tend to perform well. so those would be areas we focus on. finally we have a list of stocks dissipated --hich which have not participated as strongly as we would like. those would be the ways that we play the h-share market at this point. -- h-share market at this point.
the whole revival and consumption some say will still be a ways away in china. do you think overall, earnings will keep up? tim: we do, actually. and we think that the recovery in china domestically is one of the reasons the market that's recovered and will continue to recover. we track a variety of high-frequency indicators and that suggests the economy has put a fully reopened. -- pre-much fully reopened. the underlying strength of the consumer is a clear secular theme and one that is gaining traction. a subset of that that we particularly life is i guess -- like i guess is what we would call the digital delivery of services, the part of the economy benefiting from greater application of technology. that certainly comes through an earnings result. we will see more in the next few
weeks as second-quarter numbers are reported. we do think the domestic consumption story in many forms is one that structurally we want to be aligned with. we have seen beijing a little uneasy about the pace of these gains. you have regulators cracking down on margin financing now. do you think that is a good or bad thing for the market? tim: we think it is an unequivocal good thing. obviously the mistake that was made five years ago in the very significant run-up in 2015 and the crash in july was arguably a function of perhaps some over exuberance, or easy accommodation on the regulatory front which resulted in significant extension of margin financing not just through normal channels, but through backdoor channels, p2p lending, shadow banking, etc., in many
cases with 10 times leverage. then when there was a crackdown, that unwinding caused a significant contraction of liquidity and caused a precipitous market crash of about 50%. i think the authorities are trying to steer a pass this time. they clearly want a rising stock market for a host of reasons, including development of the local capital market, but do not want the same kind of unbridled enthusiasm that they saw five years ago. so i think there are already measures to tamp down on excessive enthusiasm, including unsanctioned margin lending. so we think that the early signs of tamping down on those sorts of excessive speculative activities is likely to ensure a longer and more steady upward trend, as opposed to something that sort of flames out early and then crashes. , emerging markets tend to take their cue from
markets and e.m. are at four month highs. a lot of the fastest growing companies in e.m.'s are already looking stretched. do you see that they will continue to gain momentum with china going gangbusters? tim: i am not quite so sure about that. i think that we need to be careful about over generalizing about e.m. as a whole. as we've just been discussing, the investment case for china right now we think is very strong. both the h and a-shares evan over for some time. that does not necessarily spread through the rest of the e.m. complex because many emerging markets have their own dynamics. mightk an area we contrast within the asia-pacific region would be india or indonesia, where the covert outbreak has not been contained, and printing pre-much on a daily basis in the last police record highs in terms of daily caseloads, which means economies there cannot reopened as
quickly, they are still suffering from lockdown aspects, so the domestic growth dynamics are clearly totally different. so we think you need to take a more specific and partial iced approach towards investing in e.m. and be more selective. that would be our view at this point. yvonne: we have seen this year beyond china, taiwan, malaysia have turned positive for the year already. which markets do you think are going to be next? tim: we still are overweight korea, for example. korea has the benefit of being a global cyclical, so as we come out of the depths of the covid-driven downturn, that should broadly benefit korea. additionally, since a great part of korea's market cap is concentrated in the technology space, it also has the benefit of the health care theme, we think there are a number of specific drivers that should be beneficial to korea. so, that is another area that we like.
additionally, one of the themes is to merge globally, first led by the u.s. and in broadening out to asia, is the rise of the retail investor. we just put out a piece introducing new retail tracking barometer, and that is something that shows that the korean retail investor is in full swing . and that is something which has also been propelling the market. in the near term we still think the upside for korea is pretty good. yvonne: we have been asking our viewers this question of the day -- what will be the next weak link in the market? what could derail this v-shaped recovery that has been priced in? tim: a few things. you hinted to it in your question, which is was not priced in. we do think valuations are stretched. if you look at the region as a whole and look at that index, it is currently trading at about 60.1 times consensus numbers. one, we think consensus is still too high for the year, expecting
just -4% decline in profits. we are looking for -12%. isondly, the market already pricing in a recovery in the second half of this year and into the first half of next. so we think the market is currently stretched -- by the are 16 times earnings -- we at elevated territory in terms of earnings basis. we are pretty elevated on a price-to-book basis, especially if you consider returns to equity. even on the most complement terry metric against bonds, we are expensive on our numbers. the market is certainly priced and a lot of good news and i think that leads to the idea that if we have some setback in terms of the pace of reopening, because of the second or third waves of viral outbreaks, than that could be something which causes markets to take a bit of a correction. always good to get your insights. -- let's
>> we will start in the u.s. where it continues to be the focus of the coronavirus pandemic with california closing andor dining and bars school district going to virtual learning only. new york city is to educate people on the importance of wearing masks and maintaining social distancing. global virus cases have now topped 13 million, with deaths at almost 570,000. numberse, spiking virus are forcing hong kong to reimpose a health measures including the re-closure of bars and gyms for at least a week and fines for anyone refusing to wear a mask on public transport. social gatherings are not limited to just four people. and amusement parks including disneyland will shut their do is again, this time for seven days. hong kong reported 41 new run a virus cases monday, as well as an 8th death.
the u.s. posted its worst ever budget deficit as federal spending tripled in june from a year earlier. in a bid to mitigate the fraud from the virus, the gap widened ion.864 bill the deficit in the first nine months of the current fiscal year now totals $2.7 trillion. global news 24 hours a day on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm karina mitchell. this is bloomberg. ahead, hong kong is taking drastic steps to retain coronavirus and sections of the city. we will speak with a dean of medicine gabriel leung, who says there might be several more cases that have not been detected. next, washington takes a stand on the south china sea, wrapping up tensions with beijing. we will have the latest. this is bloomberg. ♪ s is bloomberg. ♪
yvonne: -- haslinda: imports and exports beat expectations. exports coming in at 3.5%. we had -- sorry, 4.3%. expectations were for 3.5%. versus at 6.2% expectations of a contraction of 4.7%. improving imports indicating demand is recovering in china, the world's second-largest economy. as it battles the virus at home. exports helping support the country's gdp in the second quarter after that historic 6.8% collapse which we saw in the first quarter. imports and exports beating expectations in yuan terms.
we are still awaiting for the figures in dollar terms. thene: you are seeing market not reacted too much to those better-than-expected numbers. we are actually at session lows, the csi 300 now down 1%. shenzhen seeing losses north of 1%. chinext down 1.5%. the biggest intraday move since july 1 for the small caps. speaking of trade, china and the u.s. are trading new blows with beijing. now rejecting washington's criticism of its south china sea claims and putting sanctions on prominent politicians. mike pompeo accused beijing of a campaign of bullying and said its territorial claims are unlawful. let's get to derek wallbank. we have seen the u.s. not really take size in this issue up until now. how significant is this reversal? derek: it's a pretty big deal, i think.
ae u.s. has said for quite long time they object to the way that china goes about pressing its claims on the south china sea. now the u.s. is firmly aligning itself with the u.n. tribunal decision that said that the china claims in the philippines were unlawful. has in mind here, the u.s. been conducting freedom of navigation patrols for quite some time. they have been talking about this sort of thing for a while. this sort of puts them more on record with where they were heading to anyway. meanwhile, the trump administration has ruled out undermining the hong kong dollar. not enough support for the idea it seems. derek: not enough support and also questions whether it would work and whether there would be blowback and it would hurt the u.s. in some fashion. i think the thing that is interesting to me about this,
though, is sort of that the idea was floated at all. the u.s. is looking at ways to try and pressure china on hong kong. so far they have been fairly unsuccessful, frankly. but the u.s. is trying to figure out what to do here. larry kudlow says donald trump is not happy where china is at the moment. derek wallbank with the latest. want to bring you pictures coming out from the chinese government official brief on the latest trade figures, which we mentioned were better-than-expected. they are talking more about the uncertainties now regarding the trade picture. they are saying trade faces rising uncertainty in china, unstable factors, according to the customs. they are also still committed to implement the trade deal with the u.s., the phase one deal of course, i think they are mentioning here. it seems at this point the
numbers are looking a little better, but at least when it comes to customs officials, they are still seeing uncertainties on the horizon. we will come back and talk more about this and of course what has been going on in hong kong as well, now that we have seen these tougher, stricter measures being implemented on wednesday. this is bloomberg. ♪ s is bloomberg. ♪
singapore plunged into recession with gdp falling a record 41.2% from the previous three months. the period was characterized by the country's lockdown for two thirds of that time. for more on this we are joined by chief asian economic correspondent in hong kong. what parts of the economy where the weakest?
>> it does look like the economy was hit on all fronts. manufacturing was down 23%. 45.% in the previous -- to 40%. fell close hotels, restaurants. due to lockdown imposed. and broader restrictions on global travel. it was a big hit to the economy. economists are saying and might be over the worst for now, providing they do not have to impose harsher locked on measures. but no one has seen growth yet. looks like the economy will not get back on full feet until next year. yvonne: just goes to show how deep this contraction can be, despite the fact that some restrictions were loosened in june.
what are some of the lessons from this for the rest of the region? enda: that is the interesting thing. a lot of people are looking at howeconomies in asia to see the recovery will play out as lockdowns and resections are eased. yes, there has been a rebound in activity, but we are certainly not yet back to the level before the virus. that is not just singapore, but across the region. it reflects the ongoing restrictions on global travel, tourism, and everything that goes with it. the case was singapore for example, is even though there has been a substantial pickup in activity over the third quarter, it is not going to get back to that positive growth territory i mentioned earlier until you get into a normalized world for global travel and trade. and in the meantime, singapore will continue to feel the demand for its manufacturing goods as well. saw china trade
figures drop in the last human its. a -- last few minutes. a beat. adds to thek it idea that the chinese economy is recovering, no doubt about it. they have gotten over the worst of the virus some months ago. we know consumption is coming back. we know there has been a v-shaped rebound in production. they are well off the bottom and they will do well enough to push into positive territory this year. confuse rebound with recovery. china's economy still has a long way to go in terms of using up -- anyway, it cannot fully recover until the rest of the world does. yvonne: enda there. coming up, more about hong kong, the city raising the alarm along with fresh social distancing
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and texture, so they'll blend right in for a natural, effortless look. call in the next five minutes and when you buy 500 strands, you get 500 strands free. call right now. (upbeat music) yvonne: it is 10:29 a.m. in singapore and hong kong. haslinda: here are the first word headlines. the trump administration has rejected beijing's claims to large parts of the south china sea, reversing washington's previous policy of not taking sides in territorial disputes. the u.s. is generally called freedom of navigation in the waterway, stopping short of taking a specific position. secretary of state mike pompeo says china's claims are unlawful. china is hitting back amid rising u.s. pressure, sanctioning four officials,
including senators marco rubio and ted cruz further condemnation of chinese actions. details of yet to be released, but the move comes after washington banned three chinese officials from entering the u.s. and froze any assets they may have had in america. bloomberg is being told top advisors to president trump a ruling out undermining the hong kong dollar to punish china for tightening its grip on the city. white house aides and the state department had weighed limiting bank access to u.s. dollars to strike back at beijing to drop the idea of gathering support. sources said it could hurt the u.s. bowington's nfl team is to public and business pressure and will drop its redskins name and logo. the franchise has been criticized for years for its nickname and a string of big sponsors have been calling for a change. owner dan snyder had resisted
the possibility since buying the team 20 years ago but now has ceded to the pressure. officials are working on a new nickname and logo. yvonne: let's do a quick check of the markets right now. we are seeing a bit of a wobbling when it comes to risk assets. the u.s. session was lawfully as well. asia-pacific down 9/10 of 1%. the chinese stocks have extended the losses. u.s. futures pairing back gains as well. in the red at the start as well. the trade figures in china did not seem to change things much despite the pain we saw for june for exports and imports. still weighing the dollar terms right now, but down more than 1%. same with msci hong kong, kospi also lower. bonds have been a bit up,
including the likes of these chinese 10 year bonds which seem to be also actually putting a pause button when it comes to the rout we have seen. 3.02 for the chinese 10 year right now. 1.01 right now. the korean yuan falling half of 1%. 1207 hong kong dollars pretty steady. a resurgence of new coronavirus cases has led the city government to bring back social distancing measures after reopening the economy for about two months. they seem to be stricter than what we saw in the first and second wave. gyms and bars will close for a week and public gatherings will be limited to four. that is all coming to affect on wednesday. there will also be a fine for not wearing a mask on public transport with a significant portions of recent cases having unknown origin. the dean ofow is medicine at the university of hong kong. dr. lum, thank you for joining
us, and wearing your mask just as a precaution as well, just to send a good message because we have seen this third wave. tell us how serious is it and why has it come back, this virus, with such a vengeance? >> this is actually hong kong's first sustained local operator. -- outbreak. the march wave was mostly imported cases and they really reflect the transmissibility of the virus from the place of origin, wherever they traveled back from. not really that of hong kong. this time, we are seeing predominantly local cases and quite worryingly, a significant proportion of those whom we have very little idea where they might have got infected. we also see geographic concentration in the eastern side of the peninsula as well as
on the eastern side of the new territory. we are seeing quite a lot of worrying signs. we see clusters around restaurants and eateries, especially the sort of local restaurants where it is quick, it's good food, cheap food and people congregate around fairly crowded or cramped conditions. why has it come back so forcibly though? we have not seen dozens, if not 40, 50 number of cases a day up until now. do you think that the government was too early in lifting some of the early restrictions? doeseung: i think that one a sort of backward look now with the 2020 retrospective scope, then you wonder maybe we have some potential frailty in terms
of an adequate testing of the exempted people who come into hong kong. and these are mostly air and sea crew, ship crew. obviously, they need to come into hong kong because we need them to pilot the airplanes or the ships. but, we had been testing them. i think that loophole has now been plugged. another thing is, of course, it just shows you how difficult it is to completely eliminate this virus, even though we have had rather calm and sometimes casesred weeks of zero over the last couple of months. really, i think of the progressive lifting of the physical distancing measures, which were, of course, appropriate and necessary because you have to balance the economy, employment, and the
social consent and the emotional well-being of people having actually endured the very, very substantial lockdown measures in march. i think it is a combination of all those factors. and, of course, we have been testing quite a lot, but not nearly enough evidently. we are now leveraging the private sector, hoping that the private sector would give a very substantial boost to the testing numbers even though we are already testing quite intensively by global standards. haslinda: not nearly enough testing. how aggressive does hong kong need to be, at if hong kong is already doing better than most economies, is there a country at economy out there that is doing better? what should be the model? dr. leung: i don't think we have
actually learned in the last seven months around the world, there is no perfect model that can be completely copy and pasted to other places. i think everything has to be contextual. in the global assessment, i think hong kong still, despite a recent surge in cases, is still doing very well. a lot of countries, a lot of jurisdictions would probably look at us scratching their heads wondering why we are actually imposing these very substantial physical distancing measures again. because they would love to have our numbers. i think you need to understand that hong kong has lived through the sars epidemic in 2003. we have had periodic threats of avian influenza spreading in humans. it is a very different setting than perhaps some other places. singapore is beginning to test sewage to better detect
perhaps new clusters. it is something that has been done by the u.k., germany, the netherlands. is this something more country should be doing? dr. leung: we are also doing that in hong kong and we are ramping that up quite substantially, imminently. i think it is something that is sensible because what that allows you to do is once you are back down in terms of case numbers, where the detection threshold would not be sufficiently low to pick up the occasional cases, surveillance or viral particles, would be a much more sensitive test. in fact, that is what we do with other bugs around the world. for example, when we are talking about the eradication of polio, that is part of that surveillance.
that is only in the period when we really want to know. if we don't see it in human samples, are we still getting quite a bit of it in the environment from discharge? and that is really just one other part of the full complement of surveillance. leung, tell us more about how the virus has mutated since we first caught wind of it. has it changed a lot? it seems like it is a little more infectious now. is it also more deadly? dr. leung: so, the virus, there is a key mutation. it's a substitution of that base to 614-g.6214-d that has actually taken place to become now the predominant strain in the last two to three month already. indeed, hong kong is no exception and our research has
shown that it is probably about themore transmissible than wild type and that might be accounting for this acceleration in part. not only in hong kong but also worldwide. given how difficult it is to contact tracer at the moment, he mentioned the invisible transmission change. is this a new reality we have to live with right now, that this virus is basically going to stay until we get a vaccine? dr. leung: definitively, before this virus settles down, you would need to have sufficient immunity in the population and there are only really two ways of acquiring immunity. one is through natural infection and recovery. the other is through vaccine inoculation. safee a vaccine that is
and effective becomes widely available to the majority of the world population, it is not going to settle down. so really, we are looking at months ahead where we will still have to do a deal with multiple waves of this worldwide. haslinda: of course, we heard from thailand saying it could see a vaccine in a matter of weeks. is that being too optimistic? dr. leung: i don't think even if you have a safe and effective vaccine that is developed successfully, i don't think you would see production and manufacturing capacity and distribution capacity ramped up to such an effect you would be able to achieve widespread immunity by vaccination. i don't think it is a matter of weeks you would get a safe and effective vaccine proven. it will take us, i think, at least a few more months before we will have good definitive
evidence. remember, we are potentially deploying this new vaccine or several vaccines to everybody. safetymust watch out for and very rare but potentially very serious side effects. that is why we have to be absolutely sure, first and foremost, that we are not going to do any harm. and secondly, to make sure that the vaccine we have will at the very least protect from death and serious complications requiring icu care or ventilation. haslinda: thank you so much for your time today. gabriel leung, dean of medicine at the university of hong kong. still to come, banks kickoff earnings season in the u.s. with investors bracing for bad news. but it might not be all doom and gloom. we will tell you why.
result excited to make it a winner. su: at least one analyst is predicting that investment banking results could be greater than the market is expecting. there are other analysts who were also predicting the trading figures will be good, if not better than what was in the first quarter because of all the trading activity that has pushed the market higher. we are talking especially for fixed income, currencies and commodities. morgan iss is what jp at the top, analysts say. jp morgan is already ranked the number one player at the tables. in the analyst consistent is for second quarter sales and trading revenue, that will come in at about $5.74 billion. this is going to make jp morgan a real standout performer in a bank earnings parade which, as mentioned, is expected to be one of the worst quarterly earnings report we have seen since the
financial crisis. one market watchers said you can expect sloppy and shocking results for most of the banks. this is actually the first full quarter to reflect the pandemic impact on banks and the last quarter only had a couple of weeks in march. the hyperfocus is going to be how badly credit losses have been hurt by the virus. the related shutdowns, surging unemployment, corporate bankruptcies. jp morgan will kick off the earnings action ahead of the opening bell tuesday. according to analysts, they will actually have some silverlining results to what is expected to be a disappointing earnings round. so watch out for jp morgan. we have goldman on monday. where does goldman stand out from the pack? su: analysts are saying similarly, goldman sachs market
focused revenue should benefit more than its peers from the expected strong trading and underwriting fees growth. others were also pointing to its commodities unit as perhaps being a standout player. goldman sachs will be reporting midweek. so, it will also be early in the pack all earnings reports. goldman and jp morgan, along with morgan stanley, could standout, analysts say, as the best of the six major banks to have reversed the negative market to market impact. trading sales and revenue is expected to come in billion and excited to update investors on the legal progress related. it will help investors assess capital risks. the lower m&a activity could be seen as a negative for goldman. lastly, investors are expecting to get results, stress test details. how the capital shortfall
expected requirement and plan implementation will actually proceed. a very interesting earnings season indeed for these banks, all beginning before tuesday's opening bell on wall street. back to you. yvonne: lots of digging. su keenan with a preview of what to expect. coming up, the game is back in town. easess jump as macau quarantine requirements. we will have the latest coming up. this is bloomberg. ♪
yvonne: casino stocks jumping as macau and china lifted quarantine requirements. you can see it in the u.s. session overnight as well as in hong kong. china,cau up 7%, sands mgm china all rallying on this good news. we have the latest from our asia consumer reporter joining us. tell us what these using -- easing measures mean for the casinos and it is a really now i start of some sort of recovery? we can see from the share reaction this is really exciting news for the macau gaming sector, to see the
quarantine requirements lifted starting tomorrow. bring it it will not back to the pre-covid level anytime soon. we saw chinese visitors need to apply before entering macau. chinese visitors need to use their visa that will control traffic. this is already a very positive news after months of closures which has caused huge loss for the operator. the casino revenue could recover of thely to 50%, 25% pre-covid levels. it will be accelerated if travel curbs can be lifted too. haslinda: daniela, what are the next milestones we should be looking for in the near future? thing,: so, the next big the actual meaningful thing we are monitoring includes three
visassuance of china required to apply. that would mean a rebound. if the ibs can be reissued in the next few weeks, macau will be expected to welcome a large group of chinese visitors during the national week in october. one of the big seasons for the industry. that will be a fantastic scenario for macau to recover. we will monitor when the quarantine requirements of other provinces will be lifted. yvonne: thank you. our asian consumer reporter with the latest on macau. i want to break some new data. the dollar terms for china trade numbers just coming through. we are seeing the export numbers rising half of 1%. that is also a beat from what the economists were expecting which was a fall of 2%. imports as well. 2.7% higher.
economists were expecting a 9% drop. this is a beat on all frontiers. we have a dig under the hood to see how these sub indexes look as well. it looks to be a little better when it comes to the month of june for these trade figures. all looking forward to china's growth story. here's the latest business flash headlines. huawei facing a ban from next generation mobile networks and the u.k. as the government rolls out a two step plan to protect systems from potential security threats. we are told phone companies will not be allowed to add new huawei components to their 5g network through the end of the year. after that, all existing huawei gear has to be removed by 2027. johnson is excited to brief parliament later today. chinese starbucks rival has named new chairman and ceo in the aftermath of a sales scandal that nearly destroyed the company. he will fill both roles as he is the director and was an acting
chief executive. replacing the previous executive. the scandal led to an official and hasestigation rendered the stock almost worthless. apple is asking retail staff to work remotely again as covid-19 cases spike in the u.s. and other parts of the world. it's closing some stores in fears of pre-virus normality will not happen this year. it is poised to become the largest company in the world by market cap. other gains took to energy giant saudi aramco, although they pulled back later in the day. tesla seemingly relentless surge this year faulted slightly despite investment enthusiasm for upcoming announcements. shares gained as much as 16% monday before falling back with a rally that has taken the company past toyota in value.
tesla expected to release new deals about new batteries and entry into a potentially lucrative market. and possible additions to the s&p. a look at markets before we go. it seems like the markets are not doing much when it comes to reacting to better than expected trade numbers out of china. we did see a beat when it comes to imports and exports. hang seng lower by 400 points. the shanghai composite also lower. it seems like that rally has gone too far today. we see a brief pause. although we are seeing some signs of reversal with the aussie dollar, they have actually reversed the losses and now pretty much flat after that trade data as well. the gdp singapore, contraction entering into a recession the second quarter certainly is a focus today. the rise in cases in hong kong and states like california, the u.s. is still very much the
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♪ it is almost 11 a.m. in hong kong. welcome to bloomberg markets: asia. rishaad: let's have a look at the top stories. new data showing china's recovery goes on. exports are a beat. while imports smashed expectations. the u.s. was down 6% in the first half. haslinda: global virus infections top 14 million with
570,000 people dead, new cases in hong kong trigger type social restrictions, including mandatory masks on public transport. rishaad: and the u.s. and china ramp him tensions yet again. washington rejecting beijing's claims to the south china sea. while top u.s. senators facing mainland sanctions. haslinda: the markets testing consolidation. asia tracking the losses in the u.s. overnight. we have china announcing sanctions against u.s. officials including senators marco rubio and ted ruse. daily virus counts still surging. dampening sentiments somewhat. extending declines for the day, down by 8/10 of 1%. futures in the u.s. pointing to a higher open. s&p reached its highest levels before march before easing. lacking the broad-based strength
of the nasdaq. 40% of s&p shares have surpassed their threshold. nikkei futures pointing to a lower open. earnings season underway. companies ase on they are set to announce results on tuesday and wednesday respectively. we have the stoxx 600 index currently up by about 1%. this is the benchmark fo. take a look at where we are in terms of specific markets in asia. shanghai in focus, down 9/10 of 1% despite the trade numbers coming in better than expected. that won't support china's economic growth story. china stock market approaching $10 trillion and some say it will not stop at 10. it could double in about five years. down by 1.5%. hong kong may be in for a pause as the government is imposing
strict limits on public gatherings again. pcomp flat. we heard from the governor earlier that he will be waiting for a couple of quarters before adjusting rates. policysay he will have in the next two years. slumping 9/10 of 1%. slumping into a recession. contracting more than 40%. take a look at where we are in terms of the fx markets. the bloomberg dollar index flat, showing a little bit tilting towards the strength. dollar heavy. dollar-yen is steady. dollar-yen broke through the resistance and 10723. the dollar is flat right now after an end to the pact, according to people familiar with the matter. rish?
dataad: let's get to that out of china. june imports and exports beating even the most optimistic forecast in the bloomberg survey. it comes as the coronavirus furthers global economy endocyte of when chinese exports will recover sustainably. positive net exports will provide some support of chinese gdp growth in the second quarter. those numbers are out on thursday. let's bring in michelle lam. did those numbers make sense to you? >> yes. pmi,f we look at the june they have already rebound. it is showing it is improving. we expect gradual recovery to continue. the rest of the economies normalized. in terms of imports, i think
that is the highlight of the data released today. the strong rebound shows the domestic demand in china is probably recovering strongly. as a result, second-quarter gdp, we are looking at 3% to be released a couple of days later. rishaad: right. when we look at what's going on, we still have ppi negative. industrial production positive. how do those tote -- do those two married each other? michelle: i think inflation data, even if you look at the ppi, which is starting to improve in june. we see prices starting to rebound. it also reflects the infrastructure investment is picking up in the second quarter. any forecast for
infrastructure investment is 10% for the full year. they project policymakers are trying hard to reduce infrastructure and perhaps new infrastructure investment stimulates the economy. morenk what is the uncertain aspect for the growth outlook of the second half of the year is actually what's happening to demand. what i mean product demand. first, what is happening to consumption demand and the kind of investment demand. evenhe consumption demand, though i think, yes, we are seeing some good news related to auto sales, for example, i think overall, later market conditions in china seem pretty challenging. sitting at 5.9%. in contractionary
territory. policymakers are assessing what is the best policy to actually improve the employment situation in china. yes.n terms of -- sorry, haslinda: michelle, just some headlines to tell our viewers about. singapore and malaysia will implement the green lane for business travel. this is for business travel. the reciprocal green light will facilitate cross-border travel for essential business and official purposes. that is according to a statement from singapore's ministry of foreign affairs that was published on saturday. that has been confirmed. singapore and malaysia will implement this green lane for business travel. travelers will have to undergo ap c pcr test.
we will get details to you as we get the. rish? michelle, i just want to get back to china. how does this stimulus that china is implementing differ from what they did in 2009-2100? say lowerso, i would balance gets attention to the risk in terms of financial leveraging and what's happening in the housing market. they still use the infrastructure stimulus a lot. i think our forecast, it has become clear that 10% growth to what happened in 2009. it is more contained compared to what happened in the past. atually, even if you look
liquidity injections in may and june, the pboc has been more cautious injecting liquidity because of what happened. there's also signs of financial as others returning have taken advantage of the low interest rates and investment into structured deposits. also what's happening in the housing market, some cities have tighteningounced measures to cut housing market bubble. way of policy to you stimulus is more balanced compared to what we see. how the: we talk about demand side is still lacking the production side. how far away are we from a
recovery when it comes to demand? focus on i think if we just the june data based on the indicators, we are assessing the retail sales growth. over the second half of this year, it should be on that rejection to return to the growth we saw last year, 8%. that is actually on a steady trajectory. i think there are risks to the downside because of what's happening to the market. the government has done a lot of stimulus measures and also on the auto side, extending subsidies to be providers of new energy vehicles. for a steadyking
growth in the house prices, not too bad. not a major correction in the house prices. i think the consumption should not be doing too badly. there will be some -- into covid-19, the outbreak. if we take the catering, the tourism sectors, that will still be seeing some structural damage to these sectors due to the covid-19 situation. in hong: michelle lam kong, thank you for your time today. let's get the first word news with karina mitchell. karina: singapore plunged into recession last quarter with gdp falling in annualized 41.2% for the previous three months. the period was characterized by the country's black out for two thirds of that time as it fought to control the coronavirus by
setting down official business. the contraction is the largest on record for singapore and worst than the median estimate. the u.s. continues to be the focus of the coronavirus pandemic, with california closing indoor dining and bars. two leading school district will go to remote education only despite president trump's calls for classrooms to reopen. new york city will educate people on the importance of wearing masks and maintaining social distancing. global virus cases have topped 13 millions with deaths at almost 570,000. >> the virus remains public enemy number one. but the actions of many governments and people do not reflect this. the only aim of the virus is to find people to infect. mixed messages from leaders are undermining the most critical ingredient of any response -- trust.
karina: spiking virus numbers are forcing hong kong reimposed strict health measures, putting the closure of bars and gyms for at least a week and fines for anyone refusing to wear a mask on public transport. social gatherings are to be limited to just four people and amusement parks including disneyland will shut their doors for seven days. hong kong has reported 41 new coronavirus cases on monday as well as an eighth death. day,l news 24 hours a powered by 2700 journalists and analysts in more than 120 countries. i'm karina mitchell. this is bloomberg. ahead, westill are joined by the executive chairman of the securities commission. don't miss our exclusive interview later this hour. first, tensions tiding with beijing. mike pompeo calling it a
haslinda: the trump administration has rejected beijing's claims to large parts of the south china sea, revising u.s. previous policy of not taking sides on territorial disputes. secretary of state mike pompeo accused beijing of bullying and said that territorial claims are unlawful. our senior editor joins us now. talk about an about turn. this is significant. >> it really is significant. this is one of those things where the u.s. has complained for a long time about china's method in asserting its claims in the south china sea. now they are going out and aligning with a u.n. tribunal
decision, flat out saying it is illegitimate. change thattal marks a significant shift. here, the united states is basically saying in their view, china has scraps with all of its maritime there was regarding territorial claims. the u.s. is saying china in every single one of those is wrong. house hashe white moved coming after beijing with sanctions against american officials. what more do we have on this? i am talking the likes of ted cruz and marco rubio here. derek: it is a tit-for-tat escalation we are seeing right now. the thing i would note is on the american side, they are not going to feel punished at all. marco rubio and ted cruz are thrilled about this. ted cruz came out and joking, shoot, right after the tehran i
was not going to take, i'm not going to be able to go to beijing also. they will wear this as a mark of honor. they are signaling you are going to see escalating tensions if this does not pull away in the indeterminate future. meanwhile, the trump administration has ruled out undermining the hong kong dollar tag. we heard from mgm who said the city is a replaceable. take a listen. >> it is a difficult time, but we do need to remember that hong kong serves a great purpose. anythere are very few, if substitutes for hong kong in terms of providing a major international capital market smack in asia. singapore cannot take that over with a snap of the finger. haslinda: the bottom line, there was not enough support. derek: there wasn't enough support and it was not clear it will work either.
that is one of the key things. the u.s. was worried about whether or not it would blow back on that in some way. think this got a lot of attention for even the fact that u.s. was discussing it. i think that is the takeaway i would have here. it was a threat that didn't happen so that eases off. but think for a moment if you are in hong kong about even the fact that u.s. is willing to entertain this. larry kudlow went on fox news and said donald trump is not happy with china right now. very clear that the administration in america is willing to entertain suggestions that might have been seen as unfathomable some while ago to try to pressure china to move off of the course it is moving on a number of fronts. rishaad: derek, thank you very much. derek wallbank joining us from singapore. coming up, our exclusive
keptnda: walmart has 11,000 worldwide stores open and expects to continue doing so despite a resurgence. ceo doug mcmillon told bloomberg were kind of impact the crisis is having on business. doug: we sell food and consumables and things people really needed during this crisis. our form of retail was deemed as essential in the u.s. and in countries around the world. we have stayed open mostly throughout the crisis selling food, consumables and other things people need in stores and also online. you are right. you are alluding to the fact e-commerce has grown during this
time and that has certainly been the case with us. david: for everybody who is watching, how many total stores does walmart have? doug: around the world, 11,484. in the u.s., we have around 4700 stores that are walmart supercenters and neighborhood markets. we have another 600 sam club's in the u.s. david: you have 2.4 million associates. doug: correct. david: your revenue is about $500 billion a year? doug: a little more. david: ok. do you expect to hold onto all these employees or do you think there will be a decline in sales after we get past covid-19? doug: what happened is as we started into this covid period, we created a leave policy for our associates that needed to stay home. if they had a family member to take care of or had some concern, we created this three-tiered leave policy. hundreds of thousands of our
associates that needed to or wanted to stay home have. so, we had a need for a lot of people to run the stores, serve as it relates to e-commerce and also respond to the demand that has gone up. about 60% of the 400,000 we have hired since the middle of the march are temporary in nature. we will retain a big portion of them, but not all of them. david: your biggest competitor in the online business is obviously amazon, correct? doug: it is. in the u.s. david: what have you learned from amazon? did they teach you certain things inadvertently that make your online business better or have you done some things they wish they had done? doug: whether it is them or others, i think the goal is to learn from them and apply what should be applied. the customer has spoken. they want convenience, a broad assortment and timely delivery. aspects we are
, trying to do the same thing they are trying to do. in other respects, we have a set of aspects that are unique to walmart. maybe one of the big differences as it relates to a digital view is how we are using our stores. the fact you can go on your app and purchase items or reorder items you bought before and swing by the store later that day and open up the trunk and somebody will drop it in for you is superefficient and americans really like that service. there are unique aspects to our strategy and i think the stores underpin most of those. david: it has been rumored you are going to announce some type of prime equivalent of walmart, walmart plus, i believe. is that going to be announced sometime soon or you cannot say? doug: we have a membership we have been testing called delivery unlimited. the speculation is we will launch a membership called walmart plus. the common theme in the future
is this grocery consumable delivery from the supercenters which could include back-to-school items or even apparel items done in a really fast manner as part of a membership program is something we think will be compelling for people. based on the success we've had with this pilot of delivery unlimited, we've got confidence people do want a membership from us. when you think about it, there is a delivery cost. taking an order and delivering an order to someone's home. what the membership is fundamentally in the beginning is an ability to buy in bulk those deliveries at a discount in the form of an annual fee. that is the form we have taken. rishaad: walmart ceo doug mcmillon. going to tell you about markets as we head towards the china lunch break. declines overall and an acceleration in the shanghai composite.
down 1.1% right now. h-shares in hong kong really responsible for perhaps this drag we are seeing on the hang seng. fe slippage also coming about or big deltas in the downside. the nasdaq. down 4% from peak. ignoring some of this news coming through that we got here, these trade numbers coming in. china exports and imports on the way up in june, really smashing economists' predictions. there is a trait picture for china. .5%. say exports rose both have been forecast to actually fall, contract according to the economists we had been talking to. that is also in dollar as well.
haslinda: a very moody lion city this tuesday. almost 11:30 a.m. in singapore. in the middle of a trading day. singapore reported a slump in gdp for the second quarter. a contraction of 42.1%. it is in recession. what a slump it has been for the lion city and the road ahead for a recovery is in question. today, we have singapore and malaysia agreeing to implement a reciprocal green lane for cross-border travel between two countries. that is according to a joint press statement from both
ministers of foreign affairs. travel for essential business and official travels. we are talking about those travel bubbles. malaysia starting back in august. rish? setaad: bank of thailand is to use remaining policy space, according to the monetary side of things. they will be using that space effectively, coming from them. let's get to the first word headlines. the trump administration rejecting beijing's claims of large parts of the south china sea, reversing washington's policy of not taking sides. the u.s. has generally called the freedom of allegation while stopping short of taking a specific position. secretary of state mike pompeo says china's claims are unlawful. beijing heading back with
including senators marco rubio and ted cruz about the combination of beijing's actions. details are yet to be released with the news comes after washingtonbanned three chinese officials from entering the u.s. and froze any assets they may have in america. bloomberg is being told top advisors to president trump ruling undermining the hong kong dollar to punish china for its tightening grip on the city. weighede department had limiting bank access to u.s. dollars despite backing beijing but dropped that idea after it failed to garner enough support. saying it would be hard to implement and could wind up hurting the u.s. itself. washington's nfl team is bowing to public in business pressure and will be dropping the redskins name and logo. the franchise has been criticized for years on its nickname. owner dan snyder had resisted
the possibility of changing the team's name years ago but now conceded to the pressure. officials now working on a new nickname and logo. malaysia stock market has been one of the best-performing in the region, jumping more than 30% over the past four months amid the coronavirus pandemic. meantime, the country's capital markets regulator has introduced measures to address severe volatility during uncertain times. among those withstanding the temporary ban on short selling activities. joining us for an exclusive, the executive chairman of securities commission malaysia. thank you so much for joining us. i am just wondering why the shortselling band if there is confidence in the market? >> good morning, haslinda. thank you for having me he re. of shortselling,
clearly, there are emerging signs of recovery, haslinda. we are definitely -- as you agree -- we are not out of the woods yet. just look at the global economy. can anyone say with any level of certainty the worst is over? when we look, we are heading into a period of profound uncertainty. so, obviously, we have to take this into account. and although market performance has improved from the year to the low in march 2020, suspension until the end of this year takes into account three important factors. one is the covid-19. and overallnomy weakening of the economic environment. and three, the geopolitics.
or threeescalation escalation of the geopolitical tensions, together with a weakness in the economy and the covid-19, it all conspired to mean we could bring back shortselling from suspension. but, of course, the commission will continue to monitor developments. and we will evaluate the adequacy of additional measures to support an orderly market and mitigate any potential risk there. haslinda? haslinda: speaking of risk, i'm just wondering how you view the surge in retail investors in malaysia included. do you see that as a possible risk? surge of the retail investors -- i don't think there is a risk. although we are happy to have
the retail investors back in the not theyd whether or are investing, what do you call -- they areave looking at the companies with much better appreciation. it isment we can say helping the activity in the vibrancy of the market. as you can see, the local retail investors have brought a close to $6.4 billion at the end of june this year. 29% of total value traded up from 21% for the whole of last year. earlygh it might be too for this increase in retail but
it is a sign of their confidence in the company get. but it is definitely a good sign for the market activity and vibrancy. haslinda: is there a need to implement measures to ensure the safety of these traders? apart from allowing higher online settlement limits. >> yes, the securities commission have taken action. we will continue to take action aimed at achieving our three goals. first, our market integrity. to ensure and unable opportunities now. point onck to my first market integrity, we are looking that the conduct is fair and orderly and the market continues to function as it should.
was reliefoint which to issuers and this includes giving company some breathing space during this unusual period to regular lies the financial position. also benefiting from this relief. my third point about enabling ensurenities, we have to that we take this opportunity to recalibrate but setting aside funding to build capabilities and provide jobs for young people, displaced workers in the capital market. how through the national economic recovery plan that we are enabling those opportunities. one last point apart from that.
i think the other important focus area is provide financial support. they are inversely impacted by this pandemic. that theserecognizes enterprises are the backbone of malaysian economy, linking almost 40% of our gdp. that is also one area we will continue to focus on. haslinda? theinda: back in 2019, letter to coleman -- what has transpired since then? now -- theer is matter is with the attorney general. as a result of that, i cannot really offer you any further insight into this.
in terms of other auditors, other banks, can we expect any of the others to get scandal? the 1mdb >> likewise, as i said before, these matters are currently ongoing. some of them are in the courts. so it is really up to the courts now. what policies are being implemented to ensure a scandal like 1mdb does not happen again? clearly there are several cases at the moment that are related to 1mdb. they are all in the courts right now. i cannot really give you any insight at this stage and the yet to have a say in
it. haslinda: we thank you so much for joining us today. up, pepsicoing cashing in as people keep snacking in their homes amid the pandemic. telling us how consumer cabinets are shifting. that is next. first, just minutes from the start of the trading day in india. it is looking like it will be falling to the down side. .alf of 1% as we have prices nneka future suggesting we will be lower as well. the open in about five minutes. this is bloomberg. ♪
haslinda: pepsi is cashing in on customers staying at home as the food and beverage giant reported stronger-than-expected earnings and its forecast is even more bullish. the pepsico cfo spoke earlier about changing consumer habits amid a pandemic. >> in terms of habits, think there are a couple of notable trends. number one, there has been a reversion to big trust in brands. that was something that obviously people were moving towards smaller brands
pre-pandemic but they really have a lot of trust in big brands and i think that is likely to sustain because they really like what they have found. number two, the notion of eating at home, particularly breakfast at home is going to be a habit that will stick for a period of time. that benefits our quaker business quite a bit. number three, snacking really tends to do well regardless of the environment. people adjust to halt consumption. the snack business seems to power through these types of issues more than anything. overall, we feel like we had a pretty good quarter. >> you talked about the volume. you also talked on market share. consumers going towards well-known brands. can you touch on where you are more constructive on the year to come on that front? >> we have been investing in building market share, not by taking price down because we want to build sustainable market share.
we are focused on innovation as a mechanism to drive market share. we are focused of moving into new age asian -- new adjacent energy. also upcoming our launch of chito's mac & cheese. we are pulling the innovation levers. we are ensuring that we support the brands properly. we have seen pretty good market share gains in the snack business over the globe. in the beverage business, the market share situation has been improving an. jonathan: the away from home channels look dreadful. looking across restaurants worldwide, it is hard to see how we normalize anytime soon. in the c-suite, do you look around and say things are not returning to normal anytime soon. let's pervak the costs and investment? hugh: we do think eventually restaurants will come back as a channel. clearly right now, that is down significantly. even convenience stores which a couple of months ago were negative have now turned into
positive territory. one of the better moves we have made in the recent past was build out an e-commerce business relatively early. we started investing in that in 2015. now e-commerce is going to be about $3 billion in retail sales. we would not have been able to do that if we not invest in the past. jonathan: let's talk about how you operate at full capacity with social distancing constraints. try to operate this program, guests around me are not at the table. things have changed. they are going to be this way for a long time. i wonder as you look through your business, have you been able to operate anywhere near full capacity with these new constraints? hugh: our first priority is obviously to protect employees. that is what we spent a certain amount of money on with personal protective equipment and sanitation. the reality is social distancing does not present a big a problem
as us. our plants tend to be reasonably spread out. we have lots of salesmen out in the marketplace and they tend to be spread out. we are doing everything we can to make sure our employees stay safe while they are doing their jobs. in the second quarter, we spent 400 million dollars in covid related costs. some of that will diminish over time as we get more efficient but it is something that is a priority for us. we figured out how to do it reasonably well. , weother move we have made have reduced the complexity of our portfolio. we have taken our count down about 15%. we have learned from that. i expect we will stay down about 5% to 10% on a permanent basis. pepsico's chief financial officer, hugh johnson. down, 7/10 of 1%
in the red at the moment. looking at what's going on with the hang seng. the charge lower being helped along by those banking side of things. the banking index is 1.4% lower. against the backdrop of inflation, india's recent inflation quickening in june and it signaled price pressures and thateconomy are there and has exited nationwide lockdown. that is what we have there. this is what is going on with india's bonds looking increasingly expensive through asia's other high yields. haslinda: coming up, banks kick off earnings season in the u.s. with investors bracing for bad news, but it might not be all doom and gloom. we will tell you why. this is bloomberg. ♪
kicks off the earnings season before the bell tuesday here on wall street. at least one analyst this predicting investment banking results will be greater than the market expects and other analysts are predicting that trading figures will be good, if not better than what was posted in the first quarter. fixed income, currency economies which is known as ficc. that is where jp morgan is real strong and that is what analysts say will make it a winner this season. jp morgan is ranked number one in the lead tables and analysts consensus is going to come in at $5.74 billion. that combined will make jp morgan an outperformer among its peers. the banking's earning parade this week is expected to be the worst quarterly earnings since the financial crisis. in fact, one market watcher has called it "sloppy and shocking
in nature." that is the lobar expectation. it is the first full quarter that will reflect the impact on banks. as you may recall, the first quarter is reflected of a couple of weeks in march where the banks were all unable to have visibility on what the impact would be. right now going into this earnings, banks or hyper focused on how badly credits are hurt by the coronavirus, the related shutdown, unemployment. corporate bankruptcies. j.p. morgan chase is excited to have the most positive report. so perhaps the best bank to kick things off. haslinda: su, when it comes to goldman, where is it expected to stand out from the pack? su: goldman has a market focus revenue. analysts are saying it should benefit more the result from its peers from the expected strong trading we have seen.
there has been a lot of turnover in the last couple of months. also underwriting fee growth. that could put goldman sachs in a very strong position, including its commodities unit red physic -- typically comes in strong. goldman will report midweek along with morgan stanley. again, it is also expected to be goldman along with jp morgan and morgan stanley, one of the best of the six biggest banks to have reversed the negative market to market impact of global losses. again, that is the focus of these investors. how bad where the losses. there is also going to be in expectation that goldman will address its legal progress are greeted -- related to 1mdb. that is a big area in terms of assessing capital risk. it will likely detail its stress test expectations, capital shortfall versus expected requirements.
the other thing analysts point out is there would be some lower m&a and the most recent quarter, but goldman trading underwriting fees expected to put it at the top of most of its peers in what is a very depressed earnings season for banks. back to you. haslinda: su keenan in new york on the bank earnings in the u.s. a quick check of the latest business flash headlines. google says it plans to spend $10 billion over the coming years on technology, digital technology in india. the ceo told google for india conference that the coronavirus has made clear the importance of tech in business and social connection. india has 500 million regular internet users and is second only to china in tech growth. google has just dropped plans for new cloud services in china. shares in casino companies rallied monday as prospects
brighten for the world's largest gaming hub. southern chinese province ofngdong allowed lifting restrictions opening a way of resumption of gambling activity. macau's borders were closed in march, cutting off chinese customers and casino gaming revenue plunged by 90%. nexti is facing a ban from generation mobile networks and the u.k. as the government rolls out a two-step plan to protect systems for potential security threats. phone companies will not be allowed to add new huawei components to their network through the end of the year. after that, all existing huawei gear will have to be removed by 2027. johnson is expected to brief parliament later today. chinese starbucks rival has named a new chairman and ceo in the aftermath of a fake sales scandal that nearly destroyed the company. jinyi guo will fill both
roles and replaces the previous ceo by shareholders. an official u.s. investigation and has rendered the stock almost worthless. stock far from being worthless. tesla went on a wild ride that even took the biggest bulls by surprise after a fresh intraday record and a gain of 15%. it did in about-face enclosed lower. during 14 hours spent, almost 40,000 day traders had piled into the stock, taking tesla mania to a whole new level. rish, apart from these robin hood users, there's is also speculation that perhaps shot covering could be one of the reason why tesla shares are going gangbusters. also, expectations that tesla could be included in the s&p
500. and if tesla were part of the s&p 500, it would be the 50th biggest company there. it'd sit between paypal and nvidia. it could be a potentially big company. the s&p 500 index because it is registered four consecutive quarters of profitability. that is enough reason for it to be included. rishaad: absolutely. let's bring that chart back because this is called playing catch-up. analysts cannot catch up with this rapid rise. up 56% in the last 10 days. let me tell you something. think of it of a back of an envelope calculation. tesla's market cap at $278 billion. that is bigger than, wait for this, volkswagen, gm, ford, bmw, fiat, toyota, and
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