tv Bloomberg Markets Asia Bloomberg August 4, 2022 10:00pm-11:00pm EDT
this is bloomberg markets. i am rishaad salamat. let's have a look at our top stories. japan says china may have fired missiles over taiwan. it could be a major escalation as a show of aging's strength. they are unleashing their biggest hike in 27 years and more federal reserve officials stressed the results to fight inflation. and new york crude heading for a 10% weekly loss. evidence that the global slowdown is spurring demand. >> a slight rebound we are seeing in commodity markets. we are still down quit substantially there on energy prices which may not be such a bad thing given what the bank of england has had their inflation will be. double digits certainly for the year and then we also heard from
the rbis talking about not just the extremes but inflation. we are little bit higher in the week here as far as asian equities are concerned. we are mixing against the dollar right now. as far as commodity markets, i think what is not too obvious here is we will come back on the short end to speak with the little bit of support that is given to the u.s. dollar this week. i think compared to last two weeks or so, someone meant to get something like this out of these equity markets. >> we are looking at the central bank actions. that big 50 basis point hike was surprising. what was that afterwards was
governor bill lee set of essential good last for more than a year. they alluded to the fact that inflation could 30% by year end. they are dealing with the same macro headwinds like the fed is when dealing with heightened price pressures. also, them being exiting from the eu is making the pain a little bit more felt here right now. >> information, 9.4%. it is not looking good. a prolonged recession, this is what happened with this 50 basis point move. the thing is governor bill lee is saying ultimately everything is on the table for the september meeting. on top of that, they went on to talk about sterling. sterling fell by about .7%.
the u.s. treasury yields. when it comes to revenue, quarterly revenue declines for the first time ever since enlisted in the u.s. back in 2014. the consumption story, we are still not clear yet. >> tech stocks really feeling it has been a tumultuous fight for them. of course, we have these overhangs, we have economic slowdown. if we just look at the nasdaq and the golden dragon china index, down about a percent. 11% of the -- 11% decline in july. 41% in spite of all that. this is quiet something. maybe some light at the end of the tunnel coming from alibaba.
i think softbank is using that light. >> it is a cash call. i think they netted a lot of money in 2021. of course, the background here is they hold a sizable chunk in alibaba. you can see that on your screen. 13 billion is what they did last year. 22 billion was the overall figure as far as that goes. that is according to the fbi t. it is still them reducing their shares but maybe less so of an impact when it comes to the price of alibaba itself. you to understand why they are taking money off the table right now given that shares have been struggling to get above 100 and softbank has its own problems in terms of meeting funding. >> absolutely. this is partly dental oil prices
and a bit of overleaf there i would say. we have brent crude here. this is the worst week since 2020. is it down to demand? that is part of it. let's not forget that u.s. gasoline consumption has softened and at the same time, stockpiles and he was moving to the upside here. all those things probably to the downside. >> yes. tonight, we will see what happens to the iran part of the story. it is just a touch below $90 on west texas. let's talk about taiwan, nancy pelosi there. we are pushing friday here. certainly hard to say whether that is militarily, geopolitically. you know how japan and japan basically saying china fired missiles over part of taiwan as part of this military drill that
is taking place right now. where all of what we know about this is what stephen engle says. >> we are trying to get confirmation from taiwan and we will. i believe he is the chairman of the military. there would be a very keen guess because japan's defense ministry has been saying they estimated at least five china's ballistic missiles landed in japanese exclusive economic zones. the waters that do extent quiet south just off the northeast coast of taiwan. five of those missiles landed in their waters according to japan. four of which crossed over taiwan. that is what we need to get confirmation of. if it is confirmed, we believe it will be the first time man then chinese ballistic missiles actually flew over the main part
of taiwan i went and according to japan, is the first time chinese ballistic missiles landed in their waters. it does raise tension in the strait of taiwan with shipping lanes. i was just watching footage coming in by from the associated press, seeing some container lines still going through this, the taiwan strait. it has not deterred all traffic but some shipping lines have through their ships after the eastern part of taiwan. airlines also making some adjustments as well to stay away from these six" -- six exclusive zones with his military drills, with the air force, where the navy with rocket teams were participating. the hope is for the global commerce and geopolitical tensions. this does not turn into another taiwan state crisis that we saw in 95 or 96 when we saw at least
two u.s. carrier strike groups come into the philippines and near the taiwan strait. that escalated the tensions. the tensions lasted for eight months. we don't necessarily want that but the u.s. said that is an aircraft carrier that is fully deployed to the asia-pacific region. it is said to be in the philippine sea right now, on standby if you will. the u.s. also saying that their strike groups with vallourec and could do maritime transits through the taiwan strait in the next few weeks. they said they are not going to send the ronald reagan through the taiwan strait but it will be nearby. >> thank you, stephen engle. we will keep you up-to-date with what is happening here. my understanding is we are going to take you straight to cambodia where we are looking at some
live pictures of the chinese foreign minister. he is speaking there. let me just check if we are getting any sort of headlines about that. one of the people that you want to pay attention here -- pay attention to hear is right here. thank you for coming on the show. not sure if you heard what steve just pointed out there as far as economic and market disruption, we don't get to that point. what are the assumption you are making here? >> in terms of the military conflict, i understand that both the parties are aware that stakes are very high. so what is happening right now is i think they are testing the preparedness and response levels of each other. my biggest concern would be on
the strategic side of things. things like if we could see another leg up in further trade relations and how important the chip supply and electronic supply from taiwan is to the rule of the world and if that could be used as one of the tools in terms of getting a response from both sides. >> what sectors do you think are most at risk if the u.s. and china tensions boil over? >> like i said, in terms of taiwan is important to the semiconductor space and having learned from what russia has done in terms of choking the role of commodities and also foodgrains, i think that would be one of the strategic
responses to watch. >> how much will the dollar strength persist? how much i really taking account of when you make decisions? >> i think it will be really important to understand what is at stake here and of course we are looking at what taiwan is doing. this is the responsibility to be monitored as well. >> thank you. she is staying with us. we now have first word news. rishaad: we have diplomats from the u.s. and iran. it is all an attempt to save
2015 nuclear deal. the divide between tehran and washington is growing wider. issues have cropped up recently. this is crucial to easing the global energy crunch. the u.s. depending -- declaring monkeypox an emergency. monkeypox has spread to more than 26,000 people globally in just a few months. the cdc saying that the u.s. leads the world in monkeypox cases. brittney griner's sentence by a russian poet is considered unacceptable. she was found guilty of drug possession and smuggling their
cartridges containing cannabis oil. >> the u.s. department of state as determined that she was wrongfully detained. nothing in today's decision changes that determination. together, i attended every session of her trial. we will continue to be closely engaged in this case. we will remain in frequent contact with miss criner and her legal team. >> this ev maker is looking to attract more investors. elon musk says the company might make new factory locations. that is a look at the first word headlines.
>> we have some breaking news. this is out of indonesia. it was supposed to come out 14 minutes ago. better news. if you can take any solids from that second quarter. 3.5% with the estimates. there we go as far as trajectory. better than estimates. >> still ahead on bloomberg asia , we will discuss nancy pelosi's visit to taiwan. she is now in tokyo with the house speaker having a press briefing with the prime minister there. japan did talk about those plans over the island of taiwan. also, into their economic zone
goes. there we go, we have two years there. this is all playing out and we see some of this speaking taking place here. this is after detaining some of those early losses. there we go, that is an inversion there. >> we will see if this u.s. jobs report will do anything to tournament that inversion and whether these short and euros could break above 3%. we are all focused on that survey which is the consensus right now. let's look at how many jobs we will get right now. let's look at kathleen hays with the preview.
>> there was a jobs report, looking at payroll. how much demand for labor is there? what we will see is potentially 250,000 in the month of july. that is the consensus from our bloomberg survey. >> 72 in june. beyond that, there is enough job creation. wages are still rising. 4.9% year-over-year in july. 5.1 in june. it is still about double what the average used to be there. she is committed to a rate hikes. inflation, that is the coming
rate hike. that is the main worry. jobs may even be weaker. they don't think we are going to get a recession but they will settle for a soft landing. the message seems to me to be that we will. >> when we see what is going on, is the market still misinterpreting expectations? i want to thank you instead. that is the question here. as the market mispricing what is going on with the fed intentions? >> i think we have stepped back from giving any forward guidance.
we have seen some fed speakers come back and after that. that still remains the bigger problem. there will be some economic slowdown to come in the u.s.. the market is still way behind on that. with this jobs report and inflation numbers, we are likely to see this in the terminal fed rate. >> all right. does that mean when it comes to treasuries we have further adjustment where yield could stay above 3% now after this report? >> yes. in my sense, that is certainly a possibility. at least in the short-term yield. once markets reprice these fed
they are expected to finalize plans over the coming months. there have been frontline those in asia last month. we have this report coming through. johnson & johnson associates. they could expect there once is to be slashed. we could naturally take ahead of more than 45% this year. it knows that 2021 was an extra in every year. a quick word on facebook parent, meta. the social media giant sodas bonds across four parts. the longest part of the offering was a 40 year security. it is facing stolen cash flow. >> let's get to more detail on what is happening in the tech space. we have alibaba reported into next week.
we are coming up on alibaba. flip the boards and the defensive play has been defensive related stocks on the back of what is happening here. that is according to the japanese. a brief look across some of these names. we will get more analysis on this from taiwanese lawmakers. china following nancy pelosi's visit. he also has an into what is happening defense was i millions have made the switch from the big three to xfinity mobile. that means millions are saving hundreds a year on their wireless bill. and all of those millions are on the nation's most reliable 5g network, with the carrier rated #1 in customer satisfaction. that's a whole lot of happy campers out there. and it's never too late to join them.
with the run of the u.s. economic data, the stock rebounds as a taiwan tensions fade. nevertheless the saber rattling continuing. we also had nancy pelosi in the japanese capital right now. as were talking a bit about taiwan. >> some of the premium has been taken out, not completely. the equity market is on the way up. not just over that, over the next week, month or so still remains quite elevated. certainly the situation on the ground and quite specifically around taiwan is still very fluid right out. on the very note here, take a look at the bloomberg map. what shows you, you have a map of taiwan, six squares where the mayor -- military drills taking place with a blue streak that you see those are ships.
those are civilian ships. the names of what they are and what they're carrying are the bottom of your screen. some of them are right where the military drills are taking place and we will try to keep you up to speed on the latest on if they remain there. the taiwan strait commercially does remain open. >> there we go, dangerous times. let's bring in a taiwanese lawmaker from the ruling party. thank you for joining us. we would kick things off of the fact we have the japanese defense ministry say the missiles were fired over taiwan, according to china dated -- dated. there is no confirmation from the defense department in taiwan, what do you know and can you confirm that this military action did take place? >> first of all, yesterday they
have launched -- [indiscernible] over taiwan. they landed in the sea of japan this is regular. according to china, they have trading zone -- [indiscernible] yesterday they launched 11 missiles towards taiwan on the east side near the west pacific. those missiles, they belong to the military exercise -- from japan and the united states, to cut off the link between taiwan
and our remote island. yesterday, before yesterday they had launched this attack to taiwan, taiwan's election secretary was -- 50,000 during this. they have several tactics failed. >> there are lots of things happening, we wanted to clarify, as far as taiwan's intelligence or defense ministry is concerned, did missiles actually fly over the main island of formosa? >> 4 of the missiles fly over
the outer space of taiwan island. we have information and wave monitor -- we monitor the situation. these four missiles, according to our calculations they were landing outside of our sea. west of the pacific. because it is outer space, it is not china testing our airspace. however our radar system, our utilities department monitored all the missiles. according to what we know now, they may try to launch more missiles today or tomorrow. china's missiles -- there is no [indiscernible]
they are assembling their military -- there is no evidence, according to what we have now. >> ok, no evidence. i wonder about outer space, can you clarify what it means?does that mean they did not fly over taiwan? >> it fly over taiwan, it would not damage our islands. acquainted national regulation, outer space we did not regard as our airspace. so how are your system can count the launch site at the very beginning, the root of the missiles, we know where they are going to fall out of taiwan territory. we decided to monitor the
missiles. do not let china's psychological warfare interfere with our people. our national defense of department, they have monitor the situation. everything is under control for now. however, all this activities that happened yesterday, is extremely dangerous. any missed calculation or miss adjustment may cause severe conflict in the region. especially they launch missiles to the straight between taiwan and japan. it is very provocative. >> mr. wayne, -- wang, other than alarms going off, etc., etc. this has up the ante of the drills. you warning that there could be
war. was nancy pelosi's visitor territory when there was a mistake or a good thing? >> we do not regard it in that way. anyone can visit taiwan, we have our right to accept our guests. we are a democracy and free country even under china. in this situation, we have a steadfast rule. we cannot send the wrong signal to beijing. their military strength -- if there military strength can affect our relationship, they have little right to decide who can visit taiwan and who cannot. if we send this signal to beijing, the military exercise, will be doubled down and they
will use it in this way, in [indiscernible] . nancy pelosi, if she is coming or not his business between taiwan and united states. we cannot allow china as a final decision to approve arrival or not. that is the steadfast will between taiwan and the state. -- united states. beijing wants to interfere. nancy pelosi, if she can come to taiwan, we will welcome her. she can do business between taiwan and the night states. but, -- the united states. but taiwan -- china was to be
the final approver. we cannot send the wrong signal to beijing. >> mr. wang. point taken. it is the position of taiwan whether to allow anyone to come in. my question is, given that decision, there are repercussions that we are seeing like military drills. what kind of defensive measures in taiwan prepared for given that other position that affects the other position. >> taiwan, we have to make international trade arrangement. it is a reality. if we allow someone to visit taiwan, of course we need to have prepared her or his coming.
not only the schedule, if a guest like lucy or maite -- nancy pelosi or a premised or from another country, taiwan has to have preparation for china's response. because china there is responsible, they do not care about visibility in the region. the only thing they care about is xi jinping's intimidation. during nancy pelosi's visit, during that, after that, [indiscernible] attitude in this situation. taiwan is not the one trying to provoke any conflict here. it is peaceful. it benefits both sides of the
straight. >> i -- we have a story of taiwan facing a shortage of aircraft pilots. is that a fair assessment to make? is the military prepared for any sort of confrontation? >> in taiwan, we are expressing our militarily organization. we try to reform our reserve military. a late model of aircraft were our agreement, according to figures i have, the pilots and our air force, we are not short, but we need more. we need more capable fighters to
defend our country. for example, we are using 20-year-old air fighters. late tech 45 years old. a person training, not here. we need to modernize our capability to defend our country. we are facing china. china tries to increase their military since 2017. they input a large budget. we are the front-line of democracy. we are in a concrete place here, is not only our problem, we need more cooperation with our airlines. more cooperation with our neighboring countries.
if we -- from the past 14 years and it continues -- >> mr. wang? >> yes. >> we have seen the economic retaliation from beijing that has hurt some taiwanese local businesses, whether it is halting citrus fruits, fish, the like, have you indicated anyway that they will help taiwan in overcoming this economic cost? >> we will help ourselves. it is our problem. whether help comes or not. before this issue china has tried every year to use political reasons to stop import of goods. from this kind of freight, this
kind of economic sanction, every year, every season, sometimes every month. this time china forbidden 3000 goods to be imported into china. my government has prepared for this. i think, this will not damage our economic performance, they will export to taiwan, only occupy one percentage of taiwan architecture business. the economic tension, is not playing a major role. the military exercise will be the major this time, we are protected and safe now. >> on that last point you just made. it is a military aspect right
now, if you do not need the u.s. help, economically, do you think you will need their help militarily? >> sure. i have to clarify what i said. in taiwan we always protect our economy or country in every way. it is our response ability. however taiwan's security, it is different from regional economy and global economy, we try to help ourselves. if they can understand this, [indiscernible] china is very important, it is mainly to give us a hand we appreciate that, especially, with what we know, the united states they deploy a eurasian carrier 1000 miles away.
a lot of things happening in the chinese markets. the earnings for alibaba we will get to in a moment. breaking news here, 4.8%, that is the local currency bonded to a 22 a six -- liquidity is sometime an issue here, see get this move. we see what time this resumes trade, taking into the broader property story, the mortgage crisis or the broader liquidity issues and the sentiment around the property sector at the 10 year lows on the benchmark, spring and jd you, the sentiment this week. >> i think the gauge of chinese property developers is near the 10 year low. when you talk to investors strategist they still have huge concerns about how those property crisis in china can pan
out. they are also still very worried about the spillover effect to the banking injury -- industry. how they will handle mortgage loan default in china. it will be the focus of the investors about china going forward in the coming quarters. i think they are having much higher liquidity risk premium when it comes to investing in this sector, is that a 10 year low, i think the sentiment in general is still very much a question. >> let's talk very briefly about amtd and the fallout there. >> yes. you are seeing huge, more than 32,000 percent rally. it is kind of like, you talk to people it is dark in the first place, it is becoming one of the
biggest financial countries in the world, the news headlines saying the country is actually cutting his stake in the company. going forward at think it is, like a boom and burst picture for this stock. huge spike in the shares. it will not be very surprising to people if you see a similar burst in the coming days. >> that stock certainly is a head scratcher. i'm scratching my head to bed when it comes to the market reaction with alibaba. the overnight adrs surged on the back of their earnings. here in hong kong we reverse any gains, falling close to 3% now. >> right, i think the market in hong kong they have been pricing in at least optimism in the past two days before earnings, a 9%
rally. this morning, even after this earnings beat and analyst have over iterated the buy rating on the stock. i think the analyst reports and also any talk to investors, they still see macro risks facing e-commerce giants. in terms of all this uncertain policy in china and also all of the inflation that is hurting the global economy. that has all been persisting headwinds for the company, i think is kind of like people are cautious a little bit cautious here after the shares rally. >> thank you, i wonder how you spelled by, by or bye. i am getting. -- kidding putting more ahead. this is bloomberg. ♪
coinbase's exchange. shares jumped on the news. evergrande said they will receive a refund after canceling a contract to build a football stadium in the city, the refund will be transferred into a project escrow account, being used to settle debts with the deal. it is taking a loss minus the refund. the conglomerate has been profit wise 4.3% and the first half of the year, boosted by the global operations, the flagship company reported net income for the period, while revenue jumped just over 8%. the hong kong-based company warned of rising risks of worldwide recession. >> the recession, it is making money -- me more depressed. i look at the window and it
feels a bit better right now. tech stocks in focus, last hour of trade in hong kong morning sessions, then we can go outside and have a walk. hopefully him in his morning, the rain was quite heavy, coming up low on tech, property having a bit, country garden with the local currency bond halted. the underlying story, 0.7% on the property index, the macro looks like this with the -- on track for the best gains in six weeks on that specific index. that continues, there is 20 more ahead including the india open in the next hour. this is bloomberg. ♪