>> you are watching tape like

asia coming to you live from new york, sydney and hong kong. >> we are counting down to asia's major market open. >> estrella has just come online. the global bond rally powering on with soft eco-data in the u.s. and europe thing further bets on rate cuts next year. asian stocks are set for a weaker open. crude is cratering on growth worries even as the russian president and saudi prince continue to work together on cuts. >> we have got the open of the asx 200. at the start of the day, the focus is coming into the bond space in particular because you can see that retreat in yields being led by the longer end of the curve. it tracks the move in treasuries overnight. it is the softer labor market picture that tells us that the fed will need to start cutting rates next year to stem that

economic slowdown that is also playing into energy prices. there is concerns about supply demand dynamics. energy stocks the oneness to watch in the aussie session. the broader index as well, fractionally in the red. a staggered start. nine minutes before the online for aussie trading. not a full picture yet. broadly when you look at futures, markets today in asia, we are looking a bit mixed but mostly tilted to the downside in the session. kiwi stocks online. nikkei futures in the chicago contract fairly flat. but continuing to track the session in china. the bad news is continuing to pile up. we had the moody's downgrade to china's sovereign debt. they followed on with that with a cut to the outlook for its major banks. china really pushing back on that in terms of food there bursting -- terms of further boosting support for the yuan,

criticizing moody's understanding of the chinese economy, but still sharing that bearish sentiment around chinese stocks persisting. >> we watch how markets react to trade data later today on china. look at how u.s. futures are coming online in today's session, really muted after we had the s&p 500 falling for a third consecutive session. we have the likes of nvidia and microsoft under pressure, but also energy producers were some big losers. in the asian session, wti is coming online slightly to the upside, but not that much after falling to the $70 a barrel level in the new york session. we continue to have concerns oversupply, but you have momentum trading and lower volumes that is really leading to the downside pressure. it does not help that the demand outlook may not look that great. we have data from europe, including germany's factory orders falling unexpectedly. and on top of that we have u.s. adp private payrolls missing

estimates. that did not really sit well when it comes to sentiment. we have the dollar reversing earlier losses to gain ground. we have jobless claims on thursday in the u.s. a very important note on payrolls on friday we are looking forward to. the treasury space was a bit mixed. we have the long end section outperforming with the 10 year yield falling towards 4.1%. really it is to do with expectations of where the fed and other central banks go from here. >> it still comes back to that narrative of whether rate cuts are incoming for 2024. let's bring in a market analyst at ign. that is the trade you are looking at. >> it has been a good trade. if you caught the dovish pivot for the fed in the later part of october, you have been real awarded. right now, markets across equities and fixed income are

really priced for perfection. if there is a potential sting of the tail, it could start with nonfarm payrolls. next week we have cpi data, the fomc meeting, and retail sales will be keenly watched as well. to me you have to take a bit of -- if you caught that move, you have to take a bit off the table. that is what we are seeing currently. in terms of what comes next, if you do get that selloff which potentially could be more profit taking on a harder than expected print, i think you look to buy that dip before another rally into year end. >> do you expect to see more breadth in that market? we keep talking about the magnificent seven and not much beyond that. tony: i don't see any reason for that to change right now. it has been a strong and dominant theme and probably continues given the fact we are seeing those 125 basis points of rate cuts priced. that should support those high-growth sectors, particularly the magnificent seven. not looking for anything to

change too much in that respect. >> the market consensus seems to be that the rba is done. does that mean there are opportunities in that divergence? tony: absolutely. yesterday a significant shift in terms of the dovish rba hold, which we saw on tuesday, followed by a subpart gdp check. we are looking at pricing in risks of it rate cut in february to now seeing the rba's peak terminal rate at 4.53 percent. november would be to both months after the last hike. looking at rba cycles historically, it is that 10 to 12 month window, we will see our first rba rate cut. whether one becomes three becomes five like we saw in the u.s., these insurance cuts can multiply very quickly. at this point in time it is nice to see that priced in. i think that gives the asx 200 -- we saw it absolutely surge

yesterday -- i think that is now where there is an opportunity into year end. >> do you want exposure to china, directly or indirectly? tony: it is an area we have been steering clear of. i think the risks have certainly subsided. in terms of what needs to be done, i think it was about this time last year, the reopening first occurred. 12 months later, we are actually lower than we were. that december to january period was wonderful for the china trade. the asx 200 up about 6%, but it just faded. it has not caught -- since that point in time we have been waiting for it to read, but i don't think it will do that without further support from the authorities in china. >> what do you like right now? >> with these rate cuts coming through or expectations of rate cuts, i think you probably looked toward interest rate sectors. the i.t. sector. in australia, the financial

sector, 27% of the asx 200. for me, it is certainly keeping a firm eye on that interest rate sensitive sectors. the material sector had a good run, but we need to see more coming out of china. iron ore still looks reasonably well priced at this point. always happy to have some resource stock exposure as well. >> how is the consumer looking to you? tony: we will get more information. in australia it was certainly soft, but in the u.s. we will get more information next friday. i believe that is the retail sales data which will capture the black friday/cyber monday sales. i expect that will be quite impressive, that data. i certainly was getting at least two weeks of emails in the lead up, and another week following. they really pushed it hard this year, probably harder than i have ever seen in terms of the promotion. i think that means we do get a strong retail sales number,

particularly given it is christmas and the holiday season. >> going into 2024, is it as clear cut as we are moving from a year of hikes to a year of cuts? or is it more nuanced? tony: we saw it during the banking crisis in march. we saw pricing of cuts pushed into the market, then pulled out very quickly. the data that we see over the next seven days, whether we sit with that 125 basis point cut, it seems about right to make. -- right to me. we are coming from quite a high level. 125 basis points of cuts seems about right. that probably supports -- i would be looking to buy dips. i think a lot of people missed this rally, particularly from the start of november. i think there is a lot of money on the sideline. the real money community, they will be looking to buy dips. i think it is more of the same into 2024. >> tony, great to have you with us. market analyst at ig here. still ahead on daybreak we will

be hearing from the amd ceo on the red-hot market when it comes to semi conductors. they are unveiling a of ai chips rivaling -- a new line of ai chips rivaling nvidia. look for eight chinese banks a day after their positioning on chinese sovereign bonds. this is bloomberg. ♪

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>> you are watching at daybreak asia. oil futures are steadying in asian trading after plunging to six months lows in new york and london. this as lower market volumes intensify declines driven by oversupply concerns. bloomberg's su keenan joins us with the latest. even a bullish report on u.s. supply could not stop the slide. su: u.s. inventory is down some 4.5 million barrels, normally enough to move the market, but we also had implied gas demand falling off a cliff for the last four weeks. that feeds right into the concern, how low can oil go at this point? this on major signs of swelling global inventories, even signs that producers outside of opec-plus are exceeding their normal production quotas.

we are talking about the u.s., shipping trackers noted the u.s. for example exported a record 6 million barrels a day last week. data shows for technical reasons there is a decline in exports. west texas intermediate fell 4% in the new york session, down in asia. brent crude retreated almost by the same amount, slipping below 75. the two months declines have been dramatic. brent was close to $100 back in september. one market analyst says more support levels are giving way, further fueling selling. we talked about how algorithmic trading is part of the big swings we have seen because it exaggerates the trends when they are selling. you look at the commodities index, which fell dramatically as well, not only because the oil complex falling apart in the last session, but a decline in

sugar, the most since 2011. big moves. >> big moves. in the meantime, russian president vladimir putin is visiting key opec-plus members in the middle east. what sort of pledges are we seeing here? su: we know there is a lot of productive talk. that is the way president putin has put it. the move is a significant in its own way. first time really we have seen putin travel outside of russia in a hope right file way -- in a high-profile way since the invasion of ukraine. his plane landed in abu dhabi. he met briefly with the uae president and then went on to meet for three hours with the saudi crown prince in riyadh. putin said "we have stable and very good relations in terms of political, international and economic spirit he mentioned the humanitarian -- and economics. he also mentioned the humanitarian sector.

we know oil is very much on the agenda of discussions. russia has said it will work to ensure that if the current production cuts, about 2.2 million barrels a day for early next year, are not enough to boost the price of oil, it will push for deeper cuts to stabilize the price. the market telling opec by its latest actions they may need to do that. shery: bloomberg's su keenan with the latest on oil. you can get more on those stories and other headlines in today's edition of daybreak. terminal subscribers go to dayb . you can customize your settings so you only get the news on the industries and assets that you care about. this is bloomberg. ♪

a few years ago, ey told me there's no electricity on the island. we always thought that whatever we did here

would be an emblem of what small communities can achieve. trying to give a better life to people that don't have the means to do it. si mi papá estuviera vivo, sé que él tuviera orgulloso también de vivir de esta viviendo una vida como la que estamos viviendo ahora. es electricidad aquí es salud.

haidi: amd unveiled a new line of ai accelerated chips as it takes aim at a market dominated by nvidia. the ceo spoke with ed ludlow on the red-hot market for chips and their ambitious forecast for the industry. >> you look at trading performance, we are competitive. it is a tough help -- it is a tossup. at inference performance we are 1.4 to 1.6 times better. if you are running these models you can run more or larger models with mi300. right now, the key to ai is gpu compute. that is absolutely what everyone says. we are here to provide lots of gpu compute. ed: you had the confidence to dramatically alter your forecast for this market, the ai

accelerators. you are saying a total addressable market of $400 billion u.s. in 2027. just in august he said it was $ -- you said it was $150 billion. what has changed. lisa: we usually look at these things on an annual basis. when we were doing our plan for 2023 and beyond last year, we thought that this year there would be about a $30 billion market and it would grow 50%, compound annual growth rate, so about $150 billion in 2027, which frankly was very large. we can all see what has changed. people need more compute. they are stalling more. the numbers for this year are probably closer to $45 billion. when i spend time with our partners, when i talked to customers, what they tell us is the technology requires more compute. we believe the total market for this is upwards of $400 billion

in 2027. there is no one-size-fits-all. there will be multiple solutions. there are lots of good solutions out there today, but we believe the ma cape -- the amd capability is significant. ed: it was interesting to see on stage how mi300x manifested itself in the real world, but you already guided us that it will likely be the quickest amd product to win billion dollars. there were sections of the market that said you forecast of $200 billion of sales of mi300x in 2024 was conservative. if you say the total addressable market by 2027 is now $400 billion, now is that to billion dollar forecast for next year specifically for mi300x conservative, as the market thanks it is? -- thinks it is? lisa: you have to take a step back and look at how the technology is evolving. we did update in our last conference call to an

expectation of $2 billion in 2024 for our data center gpu's. it is an early estimate. i would say we have a clear line of sight to that. what people ask me is, there is much more customer demand, definitely, and there is also significantly more supply. we have had to prepare the supply chains so that we are ready to ramp. we will update as we go along. we are definitely on this path to ramp up mi300 the fastest as anything ever ramped at amd. i view this as a multi-year opportunity for us. shery: the ceos of wall street's biggest banks have taken their most direct swings yet at washington's plans to force them to set aside more cash as a buffer against losses. >> we had 10 years to do this and it is shocking to me we are sitting here for 10 years and talking about what it will do for small business. it was not fought fully done.

i am not sure it was shared fully among the regulators. this should be re-looked at. >> we can always have debates at the margin as to whether or not there are things we can do that can strengthen the system, but a wholesale increase of 25% capital of the largest banks with lots of individual provisions that affect different activities i think is ultimately punitive to economic growth, it doesn't strike the right cost-benefit analysis. shery: joining us is sally bakewell. sally, it's all to do with that capital cushion, especially six months after we saw the banking turmoil in the u.s. sally: that is right. banks have always lamented regulation, but when the regulators came out in july with these new capital rules proposals that would effectively require the biggest banks to set aside as much is 20% by way of new cushion to guard against future losses, they intensified their arguments and unleashed a bit of a lobbying blitz. their arguments are that this

will require that they pull back on lending to ordinary americans. it may cause them to withdraw mortgages or pull back on mortgage lending. it may cause them to lend less to underrepresented communities or small businesses. now they unleashed these arguments again today, which we have heard over and over. we heard from j.p. morgan ceo jamie dimon who said it could hurt the pension plans and montana. we heard the citi ceo saying it could hurt the stability of the farming community. they are invoking fairly emotional arguments against these capital rule proposals, but they are very political. we have democrats on the one side like sherrod brown, he said banks could easily continue to lend to small businesses, to lend mortgages. the republicans say this is another example of the biden administration's overreach. haidi: in terms of the tone of the hearings, was at a pretty perceptive crowd? -- was it a pretty perceptive

crowd? one guest earlier said there was not much of a full defense from the democrats. republicans are on the same page. sally: these hearings can have sparks flying, but it was less combative today. we heard from senator elizabeth warren, the democrat. she never pulls her punches and comes out guns blazing. today her questions were largely about the crypto industry, which does not have that much to do with banks. she thought anti-money laundering rules should apply to the crypto industry as well. she got a unanimous agreement. don't forget the banking industry has changed a little bit in some regards since these hearings started. for example, a lot of the banks have scrapped forms of junk these that used to incur a lot of rough from lawmakers at these hearings. a lot of them increased their minimum wages. perhaps there was less for some of the lawmakers to dig into

with the banks. capital rule proposals definitely took the center ground. shery: the whole idea coming from the fed and other regulators is that we want to avoid the turmoil we saw earlier this year, right? what is the consensus on how much these rules could help? sally: i think the general consensus is the collapse of silicon valley bank, it would not have been avoided had this rule been in place. banks, in invoking these more emotional arguments, what they probably care more about but is harder to bring to the courts of public opinion is the impact of these capital rules on their market businesses like trading, which are slightly more lucrative than the more mundane banking activities. that is why it has become a relatively political fight, because they are bringing these debates and arguments to lawmakers, who of course represent voting constituents. that is who they want to influence in order to have these

rules, ideally, presented in a new format or watered down completely. shery: sally bakewell here with the latest on that testimony in congress by wall street ceo's. citigroup shares jumped after the cfo said the wall street giant remains on track to deliver a full year of revenue in line with earlier guidance. that is despite a slump in trading revenue. citigroup continues to expect full your revenue between $78 and $79 billion dollars. they say it is likely to be at the lower end of that range. haidi: other stories we're following today. bloomberg learned elon musk's spacex started discussions about selling insider shares that values the company at $175 billion or more. the startup is discussing a tender offer of up to $750 million. they say spacex is weighing offering shares at about $95 apiece.

global airlines are set to post record revenue this year in the clearest sign yet of the travel industry's post-pandemic recovery. a forecast for global profit to reach $23 billion this year, double the expectation in june. sources say better than expected performances are driven in part by china's reopening boosting demand. much more to come here on daybreak: asia. this is bloomberg. ♪

haidi: you are watching daybreak asia. we are checking on markets half an hour out now from the open for tokyo and seoul in 30

minutes into trading for ozzie stocks. the asx 200 giving us an indication of the direction of travel for the rest of the region. there is a key sector under pressure this morning in the energy space, following that steep back in oil overnight. let's look at those energy stocks in more detail. it really is concerns about economic health starting to build up, concerns around inventory levels, how that will play into supply demand dynamics moving forward. energy stocks reflecting that over the course of the session so far. what we have also seen, not just with the pullback in oil prices, was also the big drop for key metals like copper. that has also been impacting those more commodity sensitive currencies. the aussie dollar is a key one, dropping around 1% over the past three days. something else that is very sensitive, the aussie dollar, to the health of the chinese economy. haidi: yeah, and of course

things keep getting worse in terms of what the ratings companies are doing. moody's cutting its outlook for eight chinese banks to negative from stable after doing the same to the nation's sovereign bonds. the agency says the move was driven by the outlook on the government's credit rating. it follows and includes three policy banks, as well as five state owned commercial lenders. moody's cut its outlook for hong kong macau and placed 26 financing vehicles on review for downgrade. the ratings group says there were signs of reduced autonomy in hong kong's political institutions since the implementation of the national security law. top leaders of the eu and china are set to hold their first in person summit in four years beginning later thursday in beijing. sources telling bloomberg the europeans will be seeking tangible progress on issues ranging from data flows the market access.our great it china

senior -- access. our greater china senior executive editor joins us now. you talked about the biden summit, the meeting that we saw where on some topics, particularly when it comes to trade and mutually beneficial aspects of the relationship, there has been some softening from beijing. will we see that when it comes to their dealings with the europeans? john: i think beijing is very obviously on a mission to improve its relationships, be it with the u.s. and europe this week, when we have the president of the eu council, the president of the eu counselor meeting with the chinese premier. there is the eu investigation into subsidies that china gives its electric carmakers. but overlaying all of that is the issue of ukraine and the war

with russia and china's refusal to condemn russia for the invasion but also its continued support in various ways of russia. that is ultimately the issue that is causing the most disturbance in this relationship. shery: of course, we are still seeing the tensions play out between china and the west, right? we are expecting this pretty much. italy formally told china it would exit the belt and wrote initiative. how significant -- and road initiative. how significant is this? john: this is something we anticipated. italy the only european country to join the belt and road, since then we have the pandemic and the invasion of ukraine, and a change in government in italy. since their prime minister has come into power, she has made it obvious that she intends to take italy out of this belt and road initiative. she has been trying to do it

without upsetting to many people in beijing, causing as much of sadness as she can -- much upset ness as she can. it seems italy has officially taken the action to withdraw from the belt and road. shery: we are also getting ready for those trade numbers out of china in just a few hours. our next guest expects november's economic data out of the country to improve, but mostly on base affects. xiojia zhi, chief china economist, joins us now. it is not that difficult to beat what happened last year given the covid reopening, but what does it say about sequential momentum? >> thank you. when we look at the latest on high-frequency data and also the pmi data, it seems to suggest that the sequential growth for

china seems to be slowing somewhat after october. the pmi data has been for contraction for manufacturing in october and november. if you look at the high-frequency indicators ranging from mobility, services consumption, as well as industrial activities, this also shows some slowing momentum from october as well. that said, its base effect seems to be quite favorable. we will see some improvement in those headline growth numbers. shery: given the stalling momentum, does that mean we will continue seeing factory deflation, that we will see consumer prices still stalling? when can we expect a turnaround when it comes to inflationary pressures? xiojia: i think inflation will likely still stay around for a

bit, at the very least for november, if you look at the data. services consumption demand seems to be holding up relatively ok, but there is a lack of upward momentum. if you look at the energy prices and also food prices, there seems to be still hovering at a relatively low level. looking to 2024 as the positive policy is gradually kicking in, and also importantly for china there is a pork price cycle that could also turnaround that would jointly help leave the headline cpi inflation as well. as for ppi, we are seeing inflation likely to continue for several months before it turns around to a positive number. shery: how much can we expect the central bank to help stimulate the economy, especially now that we see the

narrative around the federal reserve's higher for longer change? xiojia: right. if you look at the pboc's monetary policy stance, we definitely think the easing stance is likely to continue because of the need to stabilize growth and continue to shore up confidence to manage the deflationary risk in china. i think this is very important for the pboc continuing its policy easing, including more policy rate cuts. a 30 bips cut to the policy rate by end of next year. and also we think the pboc will continue to cut its rrr in order to improve the liquidity condition as well as support the fiscal expansion. some of the structural credit tools to lend targeted support to slated sectors as well as -- slighted sectors as well as

financials would be important for the pboc as well. shery: let's talk a bit about the financial systemic risks. i wonder how much lizzie makers at the central bank or on -- much policy makers at the central bank or on the fiscal side can shore up things like this. we saw moody's downgrading the rating for sovereign bonds, not to mention for banks. xiojia: right. the credit outlook for china would impact less in the near term for the renminbi asset. if we look at the real economic impact on china's fiscal policy making, i thing the impact would be rather muted. to start with, china's central government balance sheet remains quite healthy. china's debt to gdp ratio is also quite low. that would not really put a

constraint for china's capabilities to further expand its fiscal policies. i think in terms of the pboc, i think more importantly the pboc seems to put a big emphasis on stabilizing the effects as a very important part of stabilizing the market confidence on china's financial asset. i think the pboc will continue to do so as well. shery: in your view, how exposed are chinese banks to the property slump? and will heavy banking regulation within the country help stem any risk that could be systemic? xiojia: if we look at the banking sector's exposure to the property sector, in particular to property developers, the banking loan to the property sector is relatively low, around

6%. despite all these government pledges to ask commercial banks as well as the financial institutions to further increase funding conditions, the progress seems to be relatively slow as well. so there are certainly more concerns still from chinese banks regarding the potential implications on the nonperforming loans, and also some regulatory restrictions that would put such progress at a relatively slow pace. from the policy perspective, i think the chinese policymakers as well as the financial regulators and authorities will have to do more to incentivize those chinese banks to provide

more of the funding support to the property sector. and from the policy banks, definitely there is more room for them to show more of their responsibilities to doing so. haidi: xiojia zhi, good to have you with us. we have more to come on daybreak asia as we look forward to china's trade numbers as well. this is bloomberg. ♪

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haidi: the u.n. chief is stepping up his calls for a cease-fire in the desert strip. he has invoked a rarely used power to press the security council as he warns of a potential catastrophe. we know what this means intellectually. does it have any impact? >> the united arab emirates is sponsoring an initiative, but again, how much significance does it have? the u.n., as long as the security council members are there, the great powers can block anything with that. in terms of israel it has no impact as long as it has the u.s. behind it. what was really interesting, what he said was the concern about the potential for disease and an epidemic to break out in gaza's hospitals, we have 1.8 million people in estimate in the south of the strip. huge numbers of displaced people, hospitals are overloaded.

they just don't have the hygiene measures or equipment to look after that group of people. there is already talk of meningitis and other diseases breaking out there. when the secretary says the risk of catastrophe and epidemic, he is not wrong about where we stand in terms of the humanitarian position. its impact on israel is likely to be limited. israel's ambassador to the u.n. had fairly strong words in response, perhaps a bit unfairly. the secretary-general is only speaking about a humanitarian issue, not the rights and wrongs of the fight. shery: we have been talking about the remaining hostages in gaza this week. as we continue to see the strikes against hamas, how close is israel in eliminating the threat? michael: it is an interesting question. israel is demanding that the red cross gets in to see the hostages, that they have access to medicine.

that was the understanding of what the deal and the pause would involve, which apparently has not happened. the red cross says it is urgently trying to get in touch, to get access to those hostages. it is up to hamas whether that happens. the theory is the hostages are in the south of gaza. and in fact around khan younis, a town underneath gaza. they are in that vicinity. one thing that is also interesting, just in terms of the south, is that prime minister netanyahu said israeli forces surrounding the house of hamas's leader, obviously not in his house at the moment. one of the theories that has been posited is that if israel were to manage to assassinate the leader of hamas or decapitate that leadership, that might provide an opening to begin to to wind down or end the war, even if it has not been completely successful in

dismantling hamas. that is an option to watch. with the hostages, we hear reports here and there but there does not seem to be anything public at this stage. shery: when october 7 happened, i think a big reaction was, how did they not know about this? there was a report we saw in the last few days suggesting that they actually had a year ago a plan about this attack, but they dismissed it as being aspirational. there are also reports that traders may have benefited. is this putting netanyahu in a difficult situation? michael: the domestic politics of israel is fascinating. it was a strategic disaster. it is in the ballpark of what happened in 1973 when israel was completely caught off guard as well. whether it affects him or not, he is the ultimate teflon political leader. traditionally in israel, if there is a security lapse like

this, everyone joins together in the conflict and then the repercussions begin and no leader survives. netanyahu is already campaigning for survival in this. he is shirking blame all over the place to get away from it. there are extraordinary reports. you are referring to the new york times one. some of the women soldiers who were keeping an eye on gaza were directly telling their superiors we are seeing things we should not be seeing, and again it was dismissed. netanyahu allowed qatar to send aid to hamas. he believed their arguments. you would imagine there would be repercussions. there will certainly be a commission of inquiry into what happened. this is a guy that has been around for a long time, and he is pretty wily. shery: bloomberg's michael heath with the latest on politics in israel. let's turn to politics in japan. the prime minister kishida says his party will suspend fundraising events for the rest of the year. that is after some ldp members

came under scrutiny over allegations of concealed donations. bloomberg's politics reporter isabel reynolds joins us from tokyo. what are the factions in japan's ruling ldp, and what are they alleged to have done wrong here? >> this all relates to the rather arcane nature of japan's politics. japan's liberal democratic party has been in power for most of the time since 1955, but effectively within that party there are other minor parties which are called factions. each of them generally has its own leader and sometimes its own policies. they also have their own fundraising methods. what they have been accused of doing this time is holding these parties, selling tickets to raise funds. some of those funds would end up going back to individual lawmakers. those individual lawmakers are accused of not having registered all of those funds in accordance with the law, so effectively

creating a slush fund that no one knew about that they could spend at will. shery: what is this in terms of broader implications for prime minister kishida? the choice of potential successor? isabel: right, yes. it is a little hard. tosay at the moment for the moment -- hard to say at the moment. in a sense, that is a booster him, but on the other hand he has strong support from the faction that was headed by the former prime minister shinzo abe. they are at the heart of this matter. a lot of the lawmakers are facing those implications. it is hard to say what the outcome will be there. in terms of public opinion, kishida is extremely unpopular at the moment. he can ill afford to have another scandal going on in the

party. the public will be looking at how hard he clamps down, whether he can control this. i think they will also be looking askance at the options within the party. that might force the party to opt to choose a prime minister that does not hail from a faction, someone completely independent. that could implicate one politician who has very few ties within the party. haidi: politics reporter isabel reynolds in tokyo. we are looking ahead to taiwan's high-stakes presidential election next month. you can hear from the three candidates on bloomberg's time one decides, a special report. -- taiwan decides, a special report. 7:00 p.m. friday evening in new york. this is bloomberg. ♪

haidi: you are watching daybreak asia. john kerry says the world needs to phase out some fossil fuels to hit their targets by 2050. he says employing carbon capture technology is essential to reducing emissions. the clash over the fate of

fossil fuels could set up a difficult second week of climate talks at cop28. diplomats must negotiate a text everyone can agree on and reach consensus on issues, including climate financing. shery: let's get to the latest stories we are following. amazon sharply cutting fees for emergents selling clothing price below $20, a sign it is preparing with shein -- it is preparing for a war with shein. amazon's dominance of u.s. online commerce faces challenges from chinese's shein, temu, and tiktok. bloomberg has learned that apple is readying new models and upgrades for early next year to stop a sales slump. sources say the new ipad air will come in two sizes for the first time and the pro model will get oled screens. the macbook air will also feature a speedier m3 processor.

the ipad and mac account for 15% of apple's revenue combined. they have been hit by a decline in consumer tech spending. haidi: take a look at how australian and new zealand bonds are trading. australian bonds climbing for a fourth day. treasury futures rising after advancing overnight. we saw the drop in crude prices, european bonds extending gains. another day of games with australian bonds this thursday. we are watching if there is any opportunity gap between what we are seeing across australian assets versus the fed given that we are now expecting the rba potentially be done. maybe not as done as market expectations are for the fed. that 10 year yield in australia falling about six basis points. the three year taking a bit of a slide as well. we have the trade surplus likely to have expanded in october in the data due out today.

a pretty light data docket, but a lot we are watching to when it comes to data out of the u.s. shery: take a look at how we are setting up for the asian session. we are seeing australian stocks led lower by energy and financials, not surprising given that wti is below the $70 a barrel level. take a look at how we are setting up for nikkei futures. the downside of almost 1% after seeing the best day cents mid-november. the japanese yen holds steady at the 147 level. we are seeing a bit of upside against the u.s. dollar. the market opens in seoul and tokyo our next. this is bloomberg. ♪

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shery: this is daybreak asia.

we are counting down to asia's major make it our pins after we saw a risk assets taking a hit on the wall street session. we are watching the treasuries space, pretty mixed. wti at the moment below $70 a barrel. haidi: and of course also watching for some of the testimony we have heard from the big wall street banking ceos, trying to push back against these capital requirements. belle, overwhelmingly this narrative is just, how done are these central banks, and where are the opportunities in a more dovish environment? annabelle: that is right. when are we finally starting to see cutting coming through? that is the fark -- the focus for markets. we have to start of trading for seoul and tokyo. we are keeping an eye on what is happening with cash treasuries. we have the yield, that 10 year yield in the price session reverting back to the 4.1% mark. cash markets just coming online fairly steady. the data is showing a cooling

labor market in the u.s., reinforcing that fed cutting narrative. the dollar as well just a bit down in the price session. the yen treating steady against it -- trading steady against it. it is the rate differential between the bank of japan and the fed. we had an interview with the bank of japan deputy governor, who is signaling the central bank is getting closer to putting an end to the world's last negative interest rate rate change. the boj direction is the key focus. stocks were slumping at the start, down nearly 1%. let's change on, it really was that focus on energy. wti starting to stabilize so far. we are just below that $70 mark. it was a drop of more than 4% on wall street overnight. it's really about those concerns of excess global supplies that is overshadowing shrinking u.s.

inventories, but energy producers will really be some of the key names to watch in the session today because we did see energy stocks slipping overnight as well. let's change on, because aussie stocks as well, it is the energy names that are dragging down the asx 200. we are broadly up 0.2%. continuing to watch the direction for key metals like iron ore, because that is playing into the direction of the dollar, down 1% versus the greenback in the past few sessions. a note, trade data is due out this hour for australia, one to watch given that key trade relationship between australia and china. shery, you have breaking news of a very different kind. shery: spacex's starling satellite service now successfully completing nine months of u.s. military tests in the arctic. these tests now open the way for

new pentagon contracts and allowing elon musk to deepen his ties with the pentagon in the region, a growing strategic competition. our next guest says he is buying sectors that should do well in the declining interest rate environment. he is founder and ceo of sgmc capital and joins us from singapore. great to have you with us. what sectors are you looking at that have potentially suffered a lot, given that we have been in the higher for longer narrative for quite some time? where are you seeing the opportunities next year? max: you do have visibility and more clarity with respect the fact that peak rates are behind us. look at all those industries, which are more capital-intensive, which basically structurally need lower interest rates to do well. those are the sectors that have had a very poor year and you can buy on a good level.

we are thinking about clean energy and renewables. you are getting in very good valuations. we are thinking of smaller cap's, declining interest rates should do well for the smaller caps. look at real estate linked names. in a world where interest rates are going to be staying at least still, but very likely decline from here, all those names are likely to do well. you are basically allowing yourself to take high profit on high-performance and go into valuations into the coming year. shery: what are your expectations for fed rate cuts? we have seen a lot of market expectations that we could see cuts as fast as march, and also 100 basis points of easing by the end of 2024. is this a bit too optimistic? max: we feel it is a bit too optimistic. we continue to see roughly two cuts here, probably starting in the second half. the reason is the following. we believe there will be a

growth slowdown, so the fed will have to do something, but at the same time we don't see inflation falling off a cliff back to the one in a have -- back to the 1.5%, 2%. it will be rocky because growth will tell fed to cut, inflation will not give a bit of a freehand for the fed to do what it wants, but eventually those cuts will be coming in the second half of the year. i expect 100 bips next year, unless growth completely surprises to the downside, we don't see that happening. we expect rates to stay at this rate for a little bit longer. shery: given the dynamics you are talking about, are you expecting more volatility and uncertainty in the markets, at least in the beginning of 2024? max: yes, we are growing cautious of the first half of next year, especially after the recent rally. that is because up until just a few days back, and even now after the recent correction, the

market is pricing in basically a goldilocks scenario where growth slows down but the fed will be cutting very soon. basically you have a very small margin of error there. we think growth will be falling but fed will not be cutting as fast as the market thinks. before you could see a bit of negative repercussions in the equity valuations in the first half of the year, especially because those earnings could come down on the downside, given that growth is likely to be struggling for the next few months. and the market needs a bit of a breather before the fed starts cutting and we see again the light at the end of the tunnel, probably around the second half of next year. i think it will keep rallying again. shery: broader emerging markets have not necessarily done that well, or as well as expected at the start of 2023. could we see a rebound into next year? when could that materialized? -- that materialize? max: we have turned more bullish on emerging markets last week.

that is because we expect peak dollar appreciation to be behind us. in an environment where interest rates will be gradually declining on the emerging markets should do well. we expect in the following year for emerging markets to do very positively. that said, you have to be extremely selective. within emerging markets, we like south america, brazil especially. we believe that is a market with a lot of potential. clearly india is extremely compelling as a case for growth, both with respect to their demographic and growth potential. we continue to be adding to india over the last month and will continue into next year. haidi: where does china stand in your allocations? max: china, we continue having it, but we are still relatively low. that is simply because of the fact that we do need to see a catalyst in terms of visibility of their business policies, visibility with respect to the political environment, in order for a sustained rally to occur. without that you will be seeing

ups and downs. we have seen more downs this year. basically you will see a lot more volatility without a meaningful upward movement. valuations are cheap relative, absolute valuations extremely cheap. unless you see the catalyst, he will not see the markets flooded back to china in terms of foreign investment and before you see demand in the other countries like india and brazil. shery: not only india and brazil, but given the sentiment around chinese assets, we have seen investors flocking into japan as well. a lot of optimism over valuations over there, over corporate governance. how big is the boj risk? max: we feel the boj risk is huge. their monetary experiment they are doing, managing interest rates, is extremely dangerous. eventually it will have to come to an end. they cannot keep just managing interest rates this way. whether it will come to an end i n a day or three years, it remains to be seen, but

eventually that has to happen. once that happens, you have to expect equity depreciation in terms of valuations. given that we see a lot of opportunities in the geographies i just mentioned, we will not be looking to chase japan at these levels. we are very heavy on not taking exposure to japanese equities as of now. shery: the founder and ceo of sgmc capital. in the meantime let's turn to annabelle for movers. annabelle: we are keeping an eye on the energy space so far this morning. we have wti a little bit firmer. it dropped more than 4% in the session overnight. it fell back down to below the $70 a barrel level. there is a lot of pessimism coming into energy markets. it is all about concerns of excess global supplies. that is overshadowing shrinking u.s. inventories. energy stocks, we saw them falling on wall street and again

in the session so far. these are some of the biggest names in the asian energy space. let's change on. the sector that likes low oil prices is the airline one. airline stocks are rising today. it is not just about the energy moves, it is what we heard from the industry body that is forecasting profit to reach $23.3 billion over the course of this year. they are saying very strong outlook for the holiday travel season as well. another sector we are keeping an eye on this morning. shery: we are watching breaking news at the moment. we are hearing from the associated press that the u.s. military has grounded its entire fleet of osprey aircraft following the deadly crash off the coast of japan. last week we had seen that u.s. military aircraft crashing in southwestern japan. the u.s. air force had actually confirmed five bodies that have been found along with the

submerged wreckage. we even heard from president biden, saying he was heartbroken over the loss of eight u.s. service members. now we are hearing from the ap that the u.s. military grounded its entire fleet of aircraft following that deadly crash in japan. still ahead, top leaders of the eu and china are set for their first in person summit in four years. we will get a discussion on that with the president of the eu chamber of commerce in china. the first, china is set to release its trade data for november later on thursday. we will get a preview of the numbers, next. this is bloomberg. ♪

haidi: welcome back. oil futures are studying in asia trading after plunging to six-month lows in new york and london. this as momentum traders and lower market volumes intensify declines driven by oversupply concerns. bloomberg's su keenan joins us with the latest. even a bullish report on u.s. supply could not really stop the slide. su: the u.s. government reporting oil inventory in the u.s. fell by about 4.5 million barrels. that would improve the price

bid, but not here. we saw implied gas demand fly off a cliff. that was a counterbalance as well. big question between traders and investors, how low will oil go? the overwhelming bearish factor is signs of swelling global supplies. this is from producers outside of opec-plus, so those cuts don't really matter as much, including the u.s. we have a lot of tracking, shipper trackers said to be exporting a record 6 million barrels a day in the past week. that is just the factor weighing on oil. crude down dramatically in the last couple days, down 4% in the u.s. session. brent crude down as well. one market analyst has said the fact that more support levels are giving away is further fueling the momentum selling. algorithmic trends that can exaggerate the selling. you are looking at the commodities index. that also suffering as a result

of the breakdown of oil and natural gas in these last sessions. holding a five day decline. we also have sugar down to the lowest since 2011. quite a rout. haidi: russian president vladimir putin in the middle east, visiting these key opec-plus members. what is his messaging? su: his messaging is he want unity among these key leaders of opec-plus. his plane landed in abu dhabi. he first met with the president of the uae and then went on to have a three hour meeting with the saudi crown prince. in broadcast remarks, putin said we have stable and very good relations. he was talking about international, economic and humanitarian issues. he said it is important to assess what is happening. we are told one of the key items on his agenda is oil. we know the russian deputy minister has said that opec-plus

will be likely and willing to deepen the cuts. they agreed to extend 2.2 million barrel output cuts, but they are willing to extend beyond then. the russian energy minister saying if needed at the latest drop in price, where the short-term analysts say lower indicates opec-plus may need to take additional action. stay tuned. haidi: bloomberg's su keenan there. let's look at china. moody's has cut its outlook for eight chinese banks to negative from stable after doing the same for the nation's sovereign bonds. the agency says it was driven primarily by the change in outlook on the government's credit rating. it includes three policy banks and five state owned banks. moody's cut its outlooks for hong kong macau. on that last point, it is citing reduced autonomy in hong kong's political and judicial

institutions since the implementation of the national security law. comments rejected by the city government as "unfounded." on china, trade numbers due out later. bloomberg economics saying year on year comparisons will look china's data rosier than reali ty. bloomberg's china economy editor joins us for a preview. during covid zero, one of the last months of covid zero data versus now, it will be quite flattering. jill: yes, i think at this point you have to remember this is a tricky set of data to look at because there is a lot of statistical noise. this is comparing november 2022 one there was still a lot of lockdowns and restriction curbs in place across the country that were weighing on trade. we saw some pandemic outbreaks as well. that is going to weigh in on these numbers. i think at this point the consensus estimate for exports is that they are flatlining in

november, which all things considered, when you note that the drop in exports has been such a drag on the economy this year, it is not that bad. you have to look at the statistical pictures. on the import side, it seems you are likely to see a pickup november. we started to see a turnaround, may be some positive signs of domestic demands. when you are dealing with that statistical noise, difficult to get a handle on. when we look more broadly at the global picture for other indicators, trying to give an idea of what we can expect with china, we are getting a mixed signal as well. south korean exports is a real bell the weather for the region -- a real bellwether for the region. if you look at some pmi's for major trading partners for china, looking at the u.s., the euro area, japan, you are seeing contractions there. this adds up to a complicated picture for china and its to the fact that trade continues to be a major drag on the economy. we are looking at other signs of

things that can drive the recovery, including consumption, and whatever else the economy can do to turnaround its beleaguered property sector. shery: there is a lot of optimism in seeing south korean shipments of semi conductors pick up, perhaps the expectation that slump is over. are we going to see those numbers reflected elsewhere in data this week in china as well? we are getting the inflation numbers on friday. we have been in deflation territory for a while when it comes to factory output numbers. jill: yes, i think it might be well into the weekend before we get inflation statistics. that is one we want to look out for as well. factory gate prices have been falling for more than a year now in china. i don't think that is going away. the trick is to look for whether it is deepening or getting better. on the consumer side, when we talk about demand and confidence, we are looking at cpi figures in china. are we going to see a second consecutive month of numbers

tipping into deflation? these deflationary pressures in china continue to be a major issue that we are looking out for, especially into next week when we have got really key indicators of data for november, including retail sales, industrial output, unemployment statistics. we are starting to get into that period in china, a clearer picture of what is happening in november, how much is a slowdown in growth and how much will be a concern into 2024. shery: jill joining us from taipei. you can get around above all of the stories you need to know to get your day going in today's edition of daybreak. bloomberg subscribers go to dayb . you can customize your settings so you only get the news on the industries and the assets that you care about. this is bloomberg. ♪

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haidi: rakuten is having one of its worst days since than the beginning of november. this coming after the announcement by rakuten group that they would be selling shares rallying in the $475 million in the banking affiliate to pay off debt. rakuten saying it would sell 25 point million shares of rakuten bank and use the proceeds for the early repayment of bonds. bloomberg intelligence saying this sale could weaken the quality of earnings at rakuten bank. you are seeing the share move down more than 7%. staying with banks, the ceos of wall street's biggest lenders have taken their most direct swings yet at washington's plans to force them to set aside more cash. the ceos told lawmakers their institutions are safe and argued

that everyday customers would ultimately pay the price if tougher rules are enacted. the opposition is to a proposal requiring big lenders to increase their capital cushions by almost 20%. >> we had 10 years to do this and it is shocking to me that we have been sitting here for 10 years and are talking about what it will do for small business and we have to analyze it today. >> it has much more impact than people think. >> additional increases are wholly unnecessary. >> almost every element of the basel endgame proposal would make lending and other financial activities more percent -- more expensive. >> as the cost of debt goes up, it certainly can create volatility and in the treasury market. >> it will particularly diminish mortgages for lower income people. >> punitive economic growth. >> it was not thoughtfully done. i am not sure it was shared fully among the regulators. this should be re-looked at. shery: separately we also heard

from citigroup's cfo, saying that the wall street giant remains on track to deliver full-year earnings in line with earlier guidance. that took the stock higher on the wall street session. this really guidance coming despite their recognition that they will see a slump in trading revenue. citigroup continues to expect a full-year result of between $78 billion and $79 billion. mason says it is likely to be at the lower end of that range. haidi: the bank of england says it will review the risks that ai poses to the financial system. governor andrew bailey says it is crucial that banks and investors understand both the potential of the technology and the risks from changing work practices. the u.k. hosted an ai summit last month and signed an agreement tackling the risks of technology. >> it is a very important development.

it has i think quite profound implications potentially for economic growth, for productivity, and for how economies are shaped going forwards. it is something we have to embrace in that sense with our eyes open. shery: checking in on how futures in europe are opening up at the moment. we are seeing a picture of negativity, some weakness when it comes to euro stoxx 50 futures. german dax futures there sliding a little bit. broadly there is this concern that the risk rally is on the back of short-term momentum and potentially trim equities facing a tougher 2024. -- potentially german equities facing a tougher 2024. the speculation that central banks will cut interest rates, the same trade when we saw when it comes to the fed and the rally in australia, both inflation and labor markets in european economies showing signs

of cooling. we did see some outperformance in particular when it comes to travel and leisure. we saw some encouraging forecasts going into 2024, also some outperformance for car stocks and miners as well. eurobond futures, not much of a move. watching the german dax in particular edging up a day after hitting that record high. we could see some weakness in today's session. coming up next, the chinese leadership set to host eu leaders further first in person summit since 2019. we will be assessing the state of the bilateral relationship. the president of the (aidyl) hi, i'm aidyl, and i lost 90 pounds on golo. i struggled with weight loss and weight gain my entire life. with all the yo-yo dieting i did in the past, i would lose 20, 30, 50 pounds just to gain them over and over again. thanks to golo, i've been able to steadily go down the sizes in my closet and keep the weight off.

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haidi: we do have some breaking data when it comes to october

exports and dread number. seeing a gain of 0.4%, bouncing back a little bit from the contraction. so we have been looking at the situation given that we have seen gdp numbers a little bit softer than expected for australia. we've also seen the rba sounding perhaps a little bit more dovish than expected in that hold they came through with earlier in the week as well. that trade surplus for the month of october at $7.129 billion. that is a little bit lower than estimates of about $7.5 billion, that is australian dollars. in the weakness we saw in third-quarter gdp, the weakness when it comes to trade and exports was also one component of this often -- of the softer numbers. annabelle: taking a look at

markets broadly, half an hour into the session for japan and korea, at the start of the day the focus is still coming down to what we are seeing in the bond space in particular and energy markets. it's really telling the same thing to us, it is about the fed having the bandwidth and perhaps the need to start cutting rates over the course of next year, because we are seeing no signs of softness coming through -- those signs of softness coming through. more signals of weakness coming through in the labor market. we are seeing this retreat in yields tipped toward the longer end of the curve, playing out and -- playing out in commodities. it's been the big retreat, the more than 4% drop in wti overnight. it is also hitting other types of commodities as well. you are seeing the pullback for instance in copper, aluminum, palm oil, playing into this theme. into the stock space, we are broadly weaker. the nikkei and kospi half an

hour into the trading session so far. it reflects how much the energy theme is playing out. that is really what is dragging down the broader index so far today. haidi: let's get more on that and what's happening on the u.s. claimant front as well. envoy john kerry is saying the world makes a phaseout some fossil fuels to hit net zero targets by 2050. he also says employee and -- em ploying carbon capture technology is crucial for reducing emissions. that could be a difficult second week of talkds at cop 28i dubai. they must reach consensus on issues including climate financing. the japanese prime minister says his pretty will suspend fundraising events for the rest of the year. he is scrabbling to restore public trust after some ldp

members came under scrutiny over allegations of concealed donations. the latest scandal could further damage kishida's approval rating ahead of a party election as soon as next year. italy has formally told china it will exit the belt and road initiative dealing a fresh blow to beijing's expansion ambitions. the foreign minister says the path did not produce the desired effects and is no longer a priority. he says other countries not part of the program have had better results. italy joined the pact in 2019 making it the only group of seven countries to do so. haidi: wider eu and china relations are in focus this week. this is the first in person summit in four years. the president of the european

union chamber of commerce in china joins us now from beijing. is always great to talk to you. compared to the last engagement, whether in person or virtually, perhaps we've seen a soft ending position and from beijing in terms of the willingness to work more diplomatically with global partners. does that set up higher expectations for deliverables? >> i think you are right that the perception is beijing has come to bid in the way that it's engaged with the rest of the world. just a week ago, five eu countries were granted 15 days vis-a-vis china. we saw the august 24th measure coming out -- measures coming out. it will help restore a little bit of the confidence amongst businesses that china is also an attractive place to be for the future. this is something we welcome

also. continued engagement. we had commissioners coming from the eu. this year is just the latest of these initiatives. after three or four years, we have not been able to talk together. it's great to sit down and address the substantial issues that remain between the european union and china. haidi: what are you hoping can be achieved? >> i think we need to recognize now the direction of travel is not sustainable in the long term. there are deep issues with regards to russia's war on ukraine. a trade deficit is clearly unsustainable. there are deep concerns in europe about increasing oil capacity that is being exported to europe and also putting europeans under pressure. the consumption and china is simply not -- in china is simply not tv. we continue to see high

investment levels. this is a concern in europe also. that will need to be addressed before things go wrong between the two sides. [indiscernible] >> sorry. you broke up. can you please repeat the question? haidi: i think we -- shery: i think we just lost haidi. we will try to get back to that connection. coming up, the field for the next republican debate has whittled down to four, with front runner donald trump absent once again. a review next -- a preview, next. this is bloomberg. ♪

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haidi: let's get back to our conversation with jen, great to have you back with us. we were talking about what would be seen as easy wins for both sides. that they could walk away from this first in-person summit in four years and call it a success. >> i think the things that would

look like success from the european side would be better access to procurement today. we see in many sectors that european companies do not have access to this segment of the chinese economy, public procurement, whether state owned enterprises or government itself. we see significant things that can be done. an update to regulations to make it easier for companies to do business. these are things that we feel are not difficult to do but would send strong signals to the businesses. also other items that need to be addressed, as we talked about, the trading imbalances, the oil capacity, finding any way for engagement, making sure the partnership creates equal or close to equal value to both parties of the equation. haidi: i do wonder whether some of the other noneconomic issues might come up, when it comes to

beijing's positioning on the war in gaza, the war in ukraine, the claimant issues as well, do you think the european side will press upon president xi in particular to take a firmer position on these issues? >> i'm pretty sure that ukraine will also join the talks here. in making sure there is no direct/indirect support of the russian side. this again of course is at the forefront of the tensions in europe and the situation in the middle east, both prominently will join meetings today i'm sure. haidi: what about opportunities to collaborate on climate, given we are in the middle of cop 28? >> i think this is one of the things that will need to be discussed, because it is of course representing a big

opportunity for europe. china does have leadership within many areas of de carbonization. no one can build that the cost and speed that china can. we need china to be a part of that but at the same time it needs to happen in a way that is not jeopardizing the futures assignability of a viable green tech industry in europe. a discussion about what constitutes a fair market in this respect. haidi: there have been regulations and legislation on both sides that make it increasingly difficult for companies that have exposure to the chinese market to continue doing so, do you think there will be some middle ground in between the sinking of independence for the chinese market and the de-risking efforts from europe to come in the middle here? >> we very much hope so,

because it is a relationship that's created tremendous value for both europe -- we see potential europe for that -- we see potential value for that. the two need to develop a common language. china has been de-risking. they've had a focus on self-reliance for the past decade and a half and that needs to be discussed also. what does de-risking mean in a china context and european context? exports in volume, container terms to china, very considerably if you compare it to five years ago, chinese exports to europe are down significantly, it looks like it is china de-risking and not so much europe, european dependence on chinese technology, china's products, components, is continuing to grow. not so much of the other direction. it's important we develop

a common language. so we talk about this in a way that is meaningful to these relationships. >> haidi: always great to chat with you. shery. shery: here in the u.s., this evening we are looking forward to the fourth republican primary debate. the field is narrowing down to just four in what could be the contenders' final face-off before the iowa caucuses in mid-january. for more let's bring in our congressional reporter in washington. the stage is drinking. what will this debate -- the stage is shrinking. what will this debate main for the trajectory of the debate? >> not much. donald trump is not on the stage. all the candidates are vying for second place right now. the two top pulling candidates, nikki haley and governor ron desantis, are duking it out for second place, they are both

pulling in the teens, double digits behind where trump is. nikki haley has had this upward directory -- upward trajectory. she performs well in debates. ron desantis has had a bad week with a lot of turmoil within his campaign and leadership. this may shed more light but may not be a deciding factor ultimately. haidi: who has the most to lose? take a look at the republican field, a month before voting starts, how is it shaping up? >> ron desantis is the candidate with the most to lose here. he came into the race with the most money and with the most optimism he could be the one who would beat trump. early in the spring he was holding well. he's only lost ground since then. now he is struggling to be able to keep that second-place spot. nikki haley is on his heels and

the early voting stage -- in the early voting stage, he's upholding even in the top three. this could be a story of someone who comes in early with a lot of money but ultimately is not able to capture the republican base. haidi: laura davidson and washington, are correctional growth -- in washington, our congressional reporter. we're looking ahead to taiwan's high-stakes presidential election next month as well. you can hear from the three candidates and get insights into the key issues on bloomberg's "taiwan decides," a special report. catch that saturday at 8 a.m. in hong kong, 7 p.m. friday in new york. coming up, global airlines are set for a record revenue this year, with post-pandemic travel soaring even beyond industry expectations. more on the outlook, next. this is bloomberg. ♪

haidi: amd has unveiled a new line of ai accelerated chips as it takes aim to the market dominated by nvidia. the co spoke with bloomberg's ed ludlow on the red-hot market for chips and their ambitious forecast for the industry. >> if you look at training performance, we are very competitive. it's a toss up. when you look at inference performance, where 1.4-1.6 times

better, what that means is, if you are running these models, you can run more models or you can run larger models with mi 300. an right now the key to ai is gpu compute -- that is what everybody says. we are here to provide lots of gpu compute. ed: you've had the confidence to dramatically alter your forecast for this market. you are saying a total addressable market of 400 billion u.s. dollars in 2027 in august, just in august you said it was $150 billion, what's changed? >> the way you look at these things as we usually look at these on an annual basis, and so, when we were doing our plan for 2023 and beyond last year, we thought that this year there would be about a $30 billion market and it would grow 50%, compounded annual growth rate,

$150 billion in 2027. frankly it was very large. but was changed is -- we can all see what's changed. people need more compute. they are installing more. the numbers for this year probably closer to $45 billion. when we talk to customers and i spent time with our partners , what they tell us is that technology requires more compute, so when i believe the total market for this is upwards of $400 billion in 2027. it's huge. there is no one-size-fits-all. there will be multiple solutions. there are lots of good solutions out there today but we believe the amd capability is very significant and we are excited about it. ed: it was interesting to see him state how am i 300x manifests itself in the real world but you told us it will likely be the quickest amd product to $1 billion. there were sections of the market and the street that said your forecast of $2 billion of

mi 300x in 2024 was conservative. if you are saying the total addressable market by 2027 is now $400 million, then is that to billion dollar forecast for next year specifically for mi 300x conservative as the market thinks that is? >> take a step back and look at how this technology is evolving. we did update and are less -- in our last conference call and expectation of $2 billion for 2024 for our data center gpus. it's a very early estimate. i would say we have clear line of sight to that. but what people ask me is -- there is much more customer demand definitely and there's also significantly more supply because we've had to prepare the supply chain so we are ready to rev. we will update as we go along. we are definitely on this path to ramp up mi 300, the fastest it's ever been ramped at amd.

i view this as a multiyear opportunity for us. shery: amd's ceo there with bloomberg's ed ludlow. global airlines are set for record revenue this year with the covid pandemic in the past. let's get more with our reporter, dani lee, joining us now. the recovery is not necessarily even across the world, is it? >> it's not really time to crack out the champagne fully yet. this is a recovery across a global industry but it is uneven. being very much led by north america. profitability from north america will account for more than half of the global industry profits this year and next. you see how asia actually will still be in last territory this year and making a small profit the next.

thanks to high ticket prices, it's making up for the drop in cargo revenue. it's been a strong rebound. and with passenger volumes, capacity back pre-covid levels, however still some parts of the regions, particularly in asia, is still lagging behind. but the overall effect is the industry is growing back to 2019 levels and beyond. shery: how do we see airline performance from this point on? >> there are still some headwinds airlines are looking to manage. higher interest rates which is crimping the level of profitability and performance heading into next year. we also still see concerns such as oil prices and the volatility around that.

there are still some things in the macroeconomic picture, the idea whether some parts of the world or lots of parts of the world will go into recessionary territory. how will that affect consumer sentiment? we are already seeing some airlines cautious about how they see the 2024 picture on the man given the effect of so many people pain higher prices -- paying higher prices and that momentum continues into next year. definitely on the revenue side. but it still remains to be seen what that will mean for profitability. haidi: bloomberg's asia transport reporter on the airlines. some of the other corporate servers where following this hour -- elon musk's spacex has entered discussions about selling insider shares at a price that values the company at $175 billion or more. sources say the startup is discussing an offer of up to $750 billion -- $750 million. offering shares at about $95

apiece. bloomberg has learned that apple is bringing a new models and upgrades for next year to stop the sales slump. that -- the airpad air will come into sizes. the macbook air will future in your processor. they account for 15% of apple's combined and have been hit hard by the decline in consumer tech spending. amazon is cutting fees for merchant selling clothing prices below $20 in a side that it is preparing for a price war with the chinese fast fashion upstart shein. will drop from 10% -- there will drop from 17% or 10%, depending on the exact price. shery: take a look at the stocks we will be watching when markets open in hong kong and mainland china. energy producers, coming under pressure. oil prices, stabilizing and the asian session.

this after falling to the lowest level since june. there are worries over excess supply and momentum trading and low values. and wanda's founder is planning to sell the film unit as the conglomerate faces debt repayment pressure. still to come, why china's property sector and local government debt issues are the main drivers of moody's negative outlook. that is it for "daybreak asia." our markets coverage continues as we look ahead to the start of hong kong, shanghai, and shenzhen markets. standby for "bloomberg markets: china open." this is bloomberg. ♪ gusto makes it easier to find the right plan for my team. i think i'm going to need new glasses. no problem. you're covered. choose benefits without the mess. was also the first time

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