>> welcome to daybreak australia. i'm haidi stroud-watts in sydney. >> we are counting down to asia's major market opens. asian stocks set for a positive open coming off the u.s. thanksgiving holiday. brent crude dipping below $81 on discord with opec-plus. haidi: china is set to consider unsecured short-term loans for some distressed developers to end the property crisis. yvonne: as black friday kicks off the holiday shopping season, we will get the consumer outlook from australia's retailers association ceo. haidi: we do have some anticipated news out of new zealand, not surprising. we have new zealand's government forming as three parties have entered that coalition. in terms of the details we are hearing from the new zealand prime minister, he will be

deputy pm for the first half of the term and we have devon seymour appointed to be deputy pm for the second half of the term. speaking about the publicity measures the foreign homebuyer tax, will no longer proceed. winston peters will be minister for foreign affairs. act party and new zealand first get three cabinet seats. seymour has been named minister for regulation and new agencies. we had these ongoing talks between the national party act and new zealand first, the former government. we have been hearing most of the responsibilities have been determined for prime minister. we are just getting those details announced now in wellington. moving ahead, we will need to see ratification by the party organizations and hence we have that announcement that a new zealand government forming with

that three party coalition. in asia it is that holiday theme, the end to the week. japan away for their thanksgiving holiday. u.s. markets going into this weekend as well. a bit of upside when it comes to trading in sydney. watching mining and iron ore related stocks given the moves we have seen in that space. highly correlated to the intensifying beijing policymakers to call this recent rally. the aussie dollar is largely unchanged at the moment, 65.58. not a great deal of action or carry through when it comes to trading in the u.s.. we are seeing most currencies on the upside, upside for the yuan given the pboc support, the pickup of volatility over the u.s. holiday period. new zealand not seeing much of a

reaction to the expected news of the coalition government fording, trading pretty -- forming, trading pretty flat at the moment. and we are watching dollar-yen as always. yvonne: six weeks, we find more about what this government looks like a new zealand. with the thanksgiving holiday in the u.s., not a lot of follow-through. there was a lot of price action in the european markets. you talk about the pmi's we saw out of europe. signs of bottoming out. that is why we are seeing the euro and pound catch a bid. we are watching very closely what will happen when u.s. treasuries start trading in japan. look at that selloff we saw in german bunds after we heard germany will suspend debt limits for a fourth straight year. this is olaf scholz's government, forced to do the radical budget overhaul, a humiliating setback for the free democratic party and another growing sign that perhaps europe has not emerged from this pandemic or this energy crisis

just yet. haidi: that the drag may continue. could we see in this part of the world turning the corner, particularly if we see more leadership from china with the policy efforts to put a floor under the property sector crisis and whether that will finally pass through to giving a lift to these usually under pressure chinese stocks? looking at asia-pacific stocks, this uptrend is gaining traction. we see that weekly indicator turning positive. this may see a bit of strength turning forward on that chart, you can see it playing out. exactly a year ago china reopened. we could see a repeat when it comes to what happened the china reopened. we know those gains did not last long. we had multiple false starts when it comes to the chinese equity markets. we are still waiting to see whether this latest round of support could be what it takes.

yvonne: for the first time in a while we have seen this narrative changing more positively around the property sector, especially when it comes to property stocks. we are getting more details now from our sources. bloomberg has learned that china's local banks could be allowed to offer unsecured loans to qualified developers. it is an unprecedented step as beijing intensifies efforts to turnaround the real estate crisis. annabelle joins us. annabelle: we know of course that beijing is planning a huge package of support measures for its property sector. what we have heard is there will be funding support. we think there is around a $450 billion gap in financing needed to stabilize the sector, so it is really significant, that. the people it will be going to are the likes of country garden, sino ocean. now we are hearing it is the

types of loans that will be issued. so sources are telling us banks will be allowed to offer unsecured short-term loans for the first time. you want to emphasize that unsecured part. usually when builders take out other types of loans, they have to post land assets as collateral, so this is significant, this step. haidi: where would the loans go> -- loans go? annabelle: sources are telling us this will be working capital loans, money used for a day to day operating expenses, not about buying longer-term assets, it is to keep these companies open for another day of business. the idea of using the cash in this place is to free money up to be used elsewhere. we know beijing, one of the things they want to see out of this is chinese property developers repaying their loans. officials want a resolution to the crisis, so this is not the

only thing. there could be another potential measure on the way. this one would be to allow one bank to take the lead on supporting a distressed developer and also coordinate with other lenders on financing plans. that is not without risk. we have heard that the banks could be exempt from being liable for possible bad loans given that there are high risk involved. yvonne: i feel like we ask this every time, is it enough? [laughter] annabelle: it is the $1 million question, probably even bigger. the $450 billion question, the financing gap. the measures so far have not been enough to turn it around. in terms of whether this is enough to restore confidence has been a big question. the key hurdle is that chinese buyers have not felt confident the purchase of property because they were not confident it could be delivered to them. we are hearing from sources that

this could be a step to calm the nerves. not going to be an overnight solution, but could be a good starting point. you have seen the market reaction. yesterday it was the story of these property names that were flying in the session. haidi: annabelle in hong kong. the fate of the chinese economy on the demand side playing into the outlook for oil prices as well. brent crude prices briefly dipping below $81 as speculations wells over the future of production cuts from opec-plus. next week's delayed meeting of the cartel will be held online instead of in person. bloomberg has been watching this story. what more do we know about a potential disagreement? >> a zoom meeting, not great optics considering the climate, but they have done it before. holding on line -- holding it online is reasonable because there was going to be a clash for cop28.

the disagreement, angola, nigeria are not happy with its lower targets for 2024, and it revives that this agreement we had where angola, nigeria and the congo were pushed into accepting that lower output target for 2024. saudi arabia saying they don't have the same ability to produce as some of the other big opec companies. those three countries, doing an external -- pending an external order, that order has been rejected. nigeria has proven they can surpass these limits. nigeria pumped 36,000 barrels a day above the target last month. this appears to be at the root of this disagreement, the postponed meeting now taking place at the end of november. yvonne: we have been here before where they change their plans on short notice. what does this mean for the oil prices?

paul: the price has been declining. brent did dip briefly below the $81 a barrel limit. it was pretty clear the bears are controlling the narrative. crude down 16% from its peak in september. we have also got international energy agency data that shows non-epic companies -- non-opec companies like the united states, iranian supplies are coming online as the u.s. relaxes its approach. to sanctions russia is pumping more than its quota. haidi mentioned questions about the health of the chinese economy, faltering demand there. refining capacity lower as well. all of that price pressure piling up to the downside at the moment. yvonne: paul with a preview of what to expect from this online opec-plus meeting. other stories we are tracking today, qatar says a short truce in the israel hamas war will begin on friday at 7:00 a.m. local time, about a day later

than expected. negotiations over hostages and prisoners jagged on. hamas will freak 50 hostages and israel will release 150 jailed palestinians. all 200 will be women and children. the deal marks the first major lull in the conflict since hamas attacked israel in early november. talks to form a single opposition ticket for taiwan's president election have broken up after a tense public meeting. one party candidate walked out of the discussions after about an hour following some acrimony six changes. it casts doubt over the prospects of a china friendly alliance forming before friday's deadline to register for candidates. north korea says it is ending a five-year-old agreement with the south that was aimed at reducing military tensions. pyongyang says it will deploy more voices -- more forces to the border. south korea's defense ministry says it will respond to any

further provocations. north korea appeared to have successfully launched a spy satellite into orbit. the world health organization has asked china for details about a surge in respiratory illnesses in children, including pneumonia. local media have reported a steady rise in infections of a german known to cause colds in adults and pneumonia in younger children. haidi: still ahead we will get the outlook when it comes to holiday sales with the australian retailers association. how retailers are harnessing the power of ai to drive the revenue. this is black friday and christmas sales. wincrest capital says they don't think they can count on china to be the economic engine of growth it used to be. this is bloomberg. ♪

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yvonne: we are counting down to the opens in australia. as global stocks were set for a fourth week of games when it comes to equities, certainly there is bullish momentum behind this. what is driving it? is it between growth and value? it seems like growth is still winning at this point. we start to see these treasury yields falling lower. that is roiling the whole value trade. you look at that ratio of the world growth index with the world value, that has risen to the highest we have seen since early 2022. certainly investors still willing to pay for it when it comes to disease -- comes to these growth stocks. it is telling for what lies for 2024 in some ways. let's bring in barbara ann bernard, wincrest capital cio.

walk us through your outlook for next year. it seems like this soft landing scenario is gaining traction as the dominant narrative. should we buy into that right now? barbara ann: i think that is right. it is gaining traction but it is also priced in. that is what makes me a little cautious. like you just said, people are really focusing on growth. i think growth is slowing, so people will pay a premium for anything they think is growing. what i see in 2024 is a continuation of this great moderation. when you talk to private companies they will tell you more than public companies will. my friends in the private companies are telling me across the board what they are trying to do is figure out what a new normal is post-covid, what is the real baseline. they are all saying sales are down, by the way. if you look at anything from john deere, they cited a weaker outlook on the back of lower crop prices and higher interest

rates impacting demand for tractors. if you look at banks, demand for credit is down, as our home sales. basically higher interest rates have long and variable lags and are starting to infiltrate our economy, which means you have lower growth. you look at the pmi. it contracted again in november, the sixth consecutive month of being below 50. i see lower growth. i think as an asset manager that means you have to be pretty technical about where you can find growth or create alpha. i will stop there. yvonne: is that still in the equity market, you think, or are you tilted more toward the fixed income side? barbara ann: i think these are pretty formidable headwinds. retail piles and this month -- piles in this month.

i like fixed income. i think a 5% risk free rate is not bad. i also like private credit. i am of the view that demand is moderating. that does not necessarily mean we will have a great stock market next year. if demand is moderating, guess what? employment will go up and corporate profitability will go down. and yet, you have people buying in that corporate earnings will be up 12% next year. i think that is aggressive. yvonne: it is interesting that you are looking at the headwinds for growth next year and given what has been priced in these markets i don't think there is a lot of visibility on where u.s. growth will be next year either. why go into copper? i know you are quite bullish on that part. barbara ann: i'd like things where i don't have to worry so much about growth.

i'm trying to have more control over the outcome. i think copper has this wonderful tailwind from the energy transition. global stockpiles we know are low by historical standards. i know demand is set to grow greater than normal due to the energy transition. i know it takes 10 years to bring a new coppermine to market. i know higher rates have curtailed development of new supplies. that only enhances the demand-supply asymmetry in my favor. i like copper. within copper, can i find self-help stories so i have several levers of optionality? a stock that i really like, and it is close to you guys in australia, is 29 metal. that is a stock that sold off 40% when one of its two mines got flooded. the company that sought insurance funds, which it got, but while it was wedding for

those it raised enough equity to fund additional growth. i look at a stock like that, a strong management team, high-quality assets, it is at a 52 weeks low on 1.5 times next year's and a free cash flow yield for next year. i say, can lightning really strike twice? or is this the type of stock that will be fine and revert to normalized valuations? if it did, my price target is 300% upside. i like self-help. i like tailwinds that can work perspective of lower global growth. -- work irrespective of lower global growth. haidi: you mentioned alpha opportunities in their broader stock. do you think going into the inflation rate environment in 2024 is alpha or beta or better

gauge of performance next year? barbara ann: i did not hear your question. can you repeat that? haidi: you mentioned you were seeing alpha opportunities in australia. i wonder going into 2024 with all the uncertainties and challenges, do you see alpha as being the better gauge of performance? barbara ann: alpha? absolutely. if you watch the index, buy it. if you want alpha, you will have to do something different. that means going into things that are unloved and misunderstood and doing your homework. by all means, as an active manager i think you have to create your alpha. i can create alpha with investment. you can develop an infrastructure project and not have to worry about growth or interest rates next year. that is very attractive to me. we are doing that too, in singapore.

yvonne: everyone is talking about private credit now. it is not nice to have in a portfolio, it is like a must have i'm guessing. what are you looking at in private credit? barbara ann: arbitrage that i have identified there is that there is a ton of money that has been allocated towards green infrastructure, both on the equity and debt side. if you have a project that makes really good commercial sense, double-digit irr, for an investor it is easy to raise funds for in this environment. that is not the experience people are having in other sectors. people are saying it is a tough equity raising environment. there is still a lot of debt allocated, so you are still getting concessionary rates. these projects handle a lot of debt, like 80%. so if you can get debt with a three handle as opposed to a five, that is an interesting arbitrage opportunity, and one that i think will generate far

better returns for investors and the public markets in the next 18 months. the project we are looking at is a green data center in singapore, and the irr for an investor coming in today is 45% or 73% return up to the next 1.5 years. i can't do that in the equity markets. i think private credit is about finding opportunities where there is great demand and cheap financing. haidi: always great to chat with you. barbara ann bernard, a founder and cio on when chris capital. you can get a roundup of the stories in today's edition of daybreak. you can customize those settings so you just get the news on the industries and assets that matter to you. this is bloomberg. ♪ fx: stone wheel crafting) ♪

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haidi: you are watching daybreak australia. barclays is reportedly planning to reduce costs by as much by $1.3 billion which could involve 2000 jobs. a source says any cuts would be primarily on the execution services unit which encompasses the group's back office. the profitability could result in roughly 2% of the banks workforce being asked -- being axed. nissan is set to build two types of electric vehicles in the u.k., saying the decision was in part due to government support. the move could build more momentum into the u.k. car industry's transition to making ev's and give a boost to the country after brexit talks put off auto investments. origin energy investors rejected the revised takeover plan from a group led by recruit asset management.

-- by brookfield asset management. if shareholders reject the revised takeover, brookfield will try to acquire separate parts. black friday expectations and australia -- in australia. the ceo of the australian retailers association is with us next. this is bloomberg. ♪

haidi: it started off as an american chopping tradition but

black friday sales have become a truly global phenomenon. the australian retailers association says this weekends black friday and cyber monday is set to account for more than a quarter of all holiday purchases this year, over 6 billion australian dollars. joining us is the ceo of the australian retail association. great to have you with us. is this year different with the cost-of-living crisis? >> it is different but in a positive way. we are seeing consumers have had this pent up shopping listing, wanting to shop big this weekend, so we are expecting australians to bring in $6 billion this weekend, mostly driven because of the cost-of-living crisis, people wanting to make their shopping dollar go further. we expect it to be the biggest on record. haidi: does that mean a quieter christmas? paul: if you look at the overall numbers for christmas we are expecting australians to spend $67.1 billion, marginally up on last year. if you are taking a business

perspective to this, it is more than likely we are bringing sales forward into november and as a result overall we are not that positive. haidi: retail behaviors are changing too. it seems like every year my inbox is filling up earlier, well ahead of black friday. paul: what we saw this year is many retailers have responded to lower shoppers and kicked black friday seals off early, as early as two weeks before. in a stroll you this is the official start of the year of promotion -- in australia this is the official start of the year of promotion. haidi: what do you know when it comes to big ticket items, gift cards? the u.s. has been heavily into spending this year for gift cards. paul: gift cards are probably the best sustainable gift because the buyer can get what they want, something we have been promoting.

gift cards tend to be a last minute purchase, predominantly done in the last week going into christmas. this weekend, discounts are on average around 30%. we are seeing retailers go up to 70% discounts. really trying to drive sales. the big question will be profitability. haidi: what are margins looking like? paul: that will be the big questions if you are analyzing retail performance. retailers have no choice. if they are not getting customers through the door, they need to discount. they have come off two years of record christmas trading through covid. now we are seeing a slowdown in discretionary spending, having to discount more to drive sales. yvonne: you used to have david jones. i am sure you know what retailers are thinking. there is an opportunity cost. yes, in some ways they are giving away the prophets they may have captured during

christmas. but then again, now black friday is something that they can't afford not to take part of, righ? this is an event that is bigger than boxing day sales now. paul: absolutely. it is a global event. australia did not participate. people shopped online offshore to get those deals. really important. we are seeing -- it would be easy for me to comment on the retail and not participate. we have seen the majority of retailers participate in the black friday event. they need to sell high volume to make up for the margin differential. that is what we expect to see. all in all, discount will be rife over this weekend to drive sales. profitability will be the big question as they get into the next four weeks of trade. yvonne: who are going to be the winners of black friday then? paul: i think those that have participated will be winners.

particularly in the higher-margin categories, where they are probably better to take a smaller discount now rather than a bigger discount at boxing day, that is the reality. it is two different mindsets from a consumer point of view. people shopping black friday are generally shopping for others. those shopping on boxing day are generally shopping for themselves and for their households. boxing day is a clearance event to get through the last season's merchandise, through christmas gifting that did not sell. the mindset is to get those mathematics might, to make sure that you don't give margin away, but equally you are trading at your full potential. haidi: is there data that tells you what next year will be like in terms of the pain point for households? we are seeing both in the u.s. and here that it is not just lower income families that are tightening their finances, it is also by most criteria wealthier families.

paul: our forecast, probably until the middle of next year. fiscal 2025 will be a lot better environment for retailers, but the reality is it will be that down the hatches post christmas -- batton down the hatches post christmas. it makes up to two thirds of their profits. for a small business owner, it is what sustains them through the winter trading months. haidi: who is feeling the most pain in the retail sector? paul: at the moment, household goods. household goods had two phenomenal years through covid because we were all stuck in lockdown. they got a higher sales base. household goods have been doing it tough. there has been a slow for at least six months. there is no propensity in discretionary retailing, tightening up. they are feeling the most. haidi: boxing day, it feels like

it has become less relevant. paul: no, it is still a major promotion, still one of the biggest events of the year. the biggest post christmas event. black friday is the biggest pre-christmas event. the different consumer mindset plays into it. it used to be the only full priced event that we ran. it is no longer. to drive revenue, to lure customers, discounting has been part of it. expect after this black friday, retailers will have less need to discount. they are looking at trying to bank as much as they can this time of year and before the next rba interest rate potentially. haidi: i have to clear my shopping list. great to have you with us. ceo of the australian retailers association. yvonne, you will be here in must really a just-in-time. -- here in australia just in

time. bloomberg learned a trade meeting between the u.s. and european union do take place next month is likely to be delayed. sources tell us the trade and technology council is set to happen earlier next year. both sides remained deadlocked over steel and critical minerals. that meeting was pushed to mid-december. germany will suspend a constitutional limit on new borrowing or a fourth consecutive year. the finance ministry says the emergency move will be part of a revised budget presented next week. the schulz government was forced into an overhaul after jomini's top -- after germany's court ruled its project was unconstitutional. european bonds fell following the news out of germany. we had the ecb minister open to further rate hikes. let's get more from our chief rates correspondent garfield reynolds.

really watching the developments over what happened in europe given that it is a very holiday themed trading on account of the u.s. markets be enclosed. how impact full in the longer-term will that be when it comes to concerns over more borrowing as that economy slows? garfield: europe is -- you are facing some of the same issues that the u.s. government bonds are facing. you have this balance between high yields, the potential that central banks have stopped raising interest rates, but also increased issuance, and at a time when central banks have turned into net sellers of government bonds instead of net buyers. all of that makes for a situation where bonds are very attractive because of those high yields. the potential reward of those

high yields comes with this greater array of risks. this is no longer the 30 year secular bull market where you can just buy bonds assuming that yields will continue to march lower. now you are buying bonds hoping they won't march higher. and with may be the chance they will drop significantly. we will see in the coming year if we get the severe economic downturns that some investors have been banking on. the difficulty is, as the pmi's overnight from europe s how, the economies there, the manufacturing and services remain in contraction territory. it is not a severe contraction. it is not the sort of contraction that has usually been needed to lead to the kind of increase in unemployment and severe slowdown in activity and inflation that would spur the

european central bank to cut rates. you could insert -- you could say a lot of the same things about the u.s. the two economies are similar but different. the u.s. is stronger, but the fed has raised rates more. a lot of these issues will continue to play out for investors on both sides of the atlantic. yvonne: the pmi is one thing. the fact that germany is suspending its debt limits for a fourth straight year shows the headwinds you talked about, that this is an economy not emergent out of this pandemic -- not emerging out of this pandemic. is this an issue of fiscal stability we need to worry about in europe? garfield: i thought it was most pertinent that christine lagarde earlier this week highlighted that the ecb needs to know what

the fiscal outlook is going to be, what is that going to do? to what extent are governments going to be -- she did not say this, but this is the issue. to what extent are governments that are increasing spending going to be working against what central banks are doing, which is trying to cool the economy? normally if you have high inflation, the impulse should be for governments to try and spend less, rain in their outlays so they don't overheat the economy. that is not the case at the moment. there are a range of reasons, including the war in ukraine, which are leading ferments in europe in particular to look at greater -- governments in europe in

particular to look at greater outlays. the same situation is in the u.s. where there are concerns that the level of spending being pursued by the biden administration in order to achieve goals that many people think need to be achieved when it comes to on shoring, when it comes to combat cost-of-living pressures, when it comes to green transition, all of these things need government spending, but this has been pushed out at a time when the federal reserve is desperately trying to slow the economy to make sure that inflation comes down. that creates a very complicated outlook for bond investors in europe. that echoes for the u.s. and also for many in asia. yvonne: we will see if treasury yields follow suit what we saw in europe. garfield reynolds, our chief

rates correspondent for asia. this year's competition for equity market leadership appears to have ended. we have a clear winner. let's bring in annabelle to talk us through. this seems like a big win for growth stocks over value. annabelle: it has been tricky for growth versus value. we have seen these two categories jostling for position. that is because investors have been stuck in trying to understand what the fed would do, what the outlook for the economy would be. now that clear outperformance for value has started, really since november. it has come as investors have started to appreciate that perhaps the fed may be keeping rates higher for longer, but still we are at the end of the tightening cycle. we have seen more people growing confident in the prospect for a soft landing. yes, it is that clear outperformance of growth to value. the question is how long this is likely to last.

we have been speaking with a few different strategists about this. one says this growth stock rally will extend. we know lower yields are better for long-duration stocks like those in the growth sector. at least until the next central bank meetings. haidi: when it comes to central banks in asia, who is morgan stanley saying will be the first to cut? annabelle: they have been looking at all different central banks around the region. we are saying -- they are saying two in particular, indonesia and india. they are saying inflation is back into their comfort zone. both of these countries, they are saying real or adjusted inflation interest rates are still relatively high. in terms of where these banks are at in their tightening cycle, indonesia we saw yesterday, they kept rates on hold. they did have a surprise hike last month. india has been holding for four

straight months, even though they have been more on the hawkish tilt side in messaging. morgan stanley looked at all the central banks in this region to get to that decision. in terms of their schedule for 2024, india and asian asia our first up. -- and indonesia are first up. other banks don't have that same level of urgency, so thailand, malaysia, they are saying those cuts could come in early 2025. yvonne: we will see if they actually follow the fed or not. the latest warning calls. plenty more to come on daybreak australia. this is bloomberg. ♪

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haidi: new zealand's national party will form a central government with two smaller partners after reaching an agreement on policies and cabinet sessions. information comes six weeks after the country's general elections. ben wescott joins us to tell of us -- tell us about the new government. ben: four days for new zealanders but they finally have a three-way coalition between the national party, which won a -- not a majority but more than 50 seats in the new zealand parliament, then the act party and new zealand first, forming a three-way government after a

long wait for the country. yvonne: do we know what concessions were made in order to get these two parties to get the backing? ben: it is quite an unusual system. we will see the position of deputy prime minister split between the leader of new zealand first, he will be prime minister for the first half of the term. then david seymour will be prime minister for the second half of the term. in addition there has been a policy concession when it comes to the national plan to allow foreign homebuyers to purchase in new zealand, but with a high tax rate. that policy has been scrapped. the problem with that is that policy was going to pay for the promised tax cuts that the national party took to the election. without that source of revenue they will have to find a new way to pay for their promised tax concessions.

haidi: it is fascinating because we know the coalition governments are quite common. this is the first time we have seen three parties. what does it mean when it comes to the return once again of winston peters? ben: last election where jacinda return won -- adern won a majority, it was highly unusual. her party is out of the government three years later, it is all the more surprising. winston peters has been the deputy prime minister at two changes of government in the past six or seven years. in addition to that madea are on different sides of the political spectrum. he was the deputy prime minister for jacinda adern after her labour party took power and is again deputy prime minister. a bit of a political comedian -- not comedian, chameleon. [laughter] he will be the foreign minister

for new zealand after this change of government. we will be seeing a lot more of him on the world stage. yvonne: ben, thanks so much. ben wescott covering this new zealand coalition that has been form it talk about comedy -- has been formed. talk about comedy, it is almost like comedy, this time one election. yesterday -- this taiwan election. yesterday we saw that drama. tough to form the single opposition ticket. really broke up after we thought we would have an allowance last week. given the nature of what happened there, leaving the foreign president outside for 20 minutes really is not the respect you give -- the former president outside for 20 minutes really is not the respect you give the former president. you had the kmt candidate walking out after an hour.

maybe we are father away from an alliance than we were a week ago. haidi: so much interesting imagery when it comes to protocol. this symbolism. i find taiwan politics visually very compelling, most times anyway, with great pictures there. there is still a possibility that the rival candidates will come back together before the friday deadline of 5:30 p.m., but it certainly complicates resetting talks with beijing. yvonne: it certainly makes january very interesting, maybe less interesting, that this almost leads to more indication that one party could win this. i am sure the presidential candidate for the dbb is looking at this with a smile given the drama we are seeing among the opposition.

even terry gou emerging as almost a broker in the talks is certainly quite interesting as well as he tries to stay relevant in this election. we will talk a bit more with our guest here later on to really -- what is at stake and what is coming up next from the opposition parties? we have plenty more ahead on daybreak. this is bloomberg. ♪

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yvonne: we are looking at iron ore, not just the oil price but what we have seen when it comes to metals and retreating from that nine-month high. we were inching around the 130, 132 level. we are still around those levels now. the signals we are hearing from china and the ndrc, they are cracking down on speculation and illegal activities, that is dampening the mood when it comes to iron ore of late. certainly there is a lot of expectation. i am guessing the whole property story is lifting iron ore quite a bit these days. haidi: watching to see how that plays when it comes to other assets in australia. that is one of the components that has created a bit of a lift in the aussie dollar after the cell of. some stocks we are watching as trade gets underway in australia, virgin money

announcing to buy back $187 million in shares. also watching asian energy suppliers, oil dragging lower. that dispute with opec-plus about production levels resulting in this week's meeting being delayed until next week. these concerns about chinese growth are still at play. the likes of bhp and santos are the ones to watch in this session in sydney. looking more broadly, the currency i mentioned earlier, we are seeing a steady picture when it comes to the aussie dollar. a bit of a pause in the recent recovery, but we do have a bit of a reaction when it comes to the formation of government in new zealand.

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