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shery: we are counting down to asia's major market opens. haidi: is draw you just came online. more asian stocks rise as investors brace for another central -- busy week with the fed and other central banks set to release her final policy decisions of the year china's top leaders pledging to strengthen physical supports, rising expectations for next year's growth target as the economy faces more inflationary pressure. fumio kishida set to replace 15 officials over a scandal over slush fund's. we set up for a busy week i was alluding to. these policy decisions, even if we get holds, more communication as to pass ahead into 2024. it affects about 60% of the global cup -- economy. the fed is front and center given how much market pricing there already is for rate cuts.

it will be interesting to see the level of said milling from chair powell of this wiki given the precarious the situation. we are already seeing asian stock futures handing back a lot of earlier gains. the start of the cash trading session in sydney looks flat at the moment. after a largely positive futures session. we are also seeing a little bit of distraction when it comes to bonds. when you look at how bond traders have to navigate what will be a monumental week in terms of policy decisions. the aussie dollar holding at 6577 looking at potentially one of the more volatile currencies that could be traded given we are expecting broadly more downside trajectory for the greenback. elsewhere, we are seeing pretty flat trading in new zealand. off session lows from this morning. chicago nikkei futures handing back some early positivity to trade pretty much flat at the moment. we are watching some political fallout when it comes to japan

on the moment with big changes in these ministers as well as other governmental officials that could be set to lose their jobs over the funds scandal. we are also watching china as we get the messaging from the politburo meeting at the end of last week that was very interesting in terms of a bigger push for fiscal support and much less when it comes to what we expect from the pboc which in a lot of way makes sense given the limited ammunition we have when it comes to monetary policy now. shery: we aren't expecting them to do much. perhaps, essay story with other central bank decisions at this week including the fomc expected to hold rates steady for a third consecutive time. u.s. futures are coming online in the asian session pretty muted after we saw starks -- stocks rising friday. we had expectations the u.s. will avoid recession. the s&p 500 gained ground for six consecutive weeks.

now that is on the back of that friday's jobs report that showed unexpected strengthening. u.s. consumer sentiment data is rebounding sharply in early december. so, traders are not really expecting much of this week. but, they are also trimming their bets on rate cuts in 2024. we saw treasuries slumping with the two year yield jumping above a 4.7%. when it comes to oil prices look at brent under pressure now after gaining ground friday on the stronger u.s. data and also u.s. plans to refill the strategic petroleum reserve. suffice to say, long-term, is the longest weekly losing streak for oil since late 2018. that's a lot to do with demand concerns especially, perhaps, the weakness we continue to see in china. haidi: yeah. at a steeper than expected fall when it comes to consumer and producer prices for november heightening deflation fears. at the same time, we will talk

about the fact china's top leaders pledged to strengthen physical support and support of economic progress. the politburo said monetary policy will be stepped up appropriately. the chief asia pacific correspondent joins us. alysia, no doubt you have been watching closely the messaging from the politburo. what do you make of that against the backdrop of data that shows more weakness than perhaps a lot of us were expecting? alicia: well, i would not read so much a stimulus out of the statements because it says to me that china is increasingly wary of too much of anything international. i think the idea of having a big stimulus and additional debt putting about a time when celebrate china is something that i think it's clearly not in the cards. on the other hand, i think on the monetary side they are aware

they will have more room thanks to the fed. so, to me, what china needs is time. we saw that with the delayed plenum. they needed to figure out, and xi jinping's latest statement is on how difficult it is for china to move on in its development all stage. that says it all. it is clear they need to think of something. for me, they need to think of fiscal reform. not necessarily fiscal stimulus. they need to figure out how to feed of the local governments. what kind of taxes the local governments needed to avoid him a potentially, even, default at the local level. so, this is more than stimulus. it might be that indeed the economic program shows, let's do something more relevant. that's what it is. it's not big stimulus. haidi: i think what you say goes to the fact a lot of the problems are structural. it's not just eight less complicated cyclical slowdown.

if you are underwhelmed by what the audit bureau read out, are you also managing expectations for the central economic work conference we also expect this month? alicia: exactly. the readout, that's what i meant to say, the readout really is in a way framing our expectations. it won't be big stimulus. they will have said it differently. it's more about, we will look at the system to avoid a cliff in 2024. we know that because there was a stimulus at the end of 2022 coming from all this additional bond issuance that they need to now basically reworked out. so, there is no major stop in growth. but that's not stimulus. basically that's keeping doing what they have been doing to avoid a fall out in growth. i am not expecting anything bigger than that in the working program.

shery: it is interesting to see the sphere. that despite the pressure on the chinese economy, financial assets across the region seem to have decoupled from a chinese financial assets. not to mention, the economies in the region seem to be rebounding, whether it is trade in semiconductor exports and other areas as well. will this trend continue for other economies in the region in 2024? alicia: yes absolutely. we see it in portfolio flows. i mean, the inflows and outflows from china. this will continue because in a way, the fed easing helps those markets even more than they help china. because, basically, of capital controls in china. i think that what will happen is we have already seen this in latin america for that matter. we see a lot of top portfolio flows betting on basically

yields in domestic currency in countries that have suffered from the fed. so, this is the year of those ems. that might not include china. at least it hasn't included it this year and it's hard to see that happening without a big stimulus. so, yes, more decoupling. especially for south korea because the semiconductor cycle. even taiwan for that matter. all that will create additional decoupling for the performance of financial assets in asia. in favor of india, south korea, you name it. and again, against a backdrop of a still struggling china. haidi: alicia, to your point earlier, it's really about the expectations the fed will ease. that at least it will not tighten further. how important is it heading into 2024 win a rate cut is very much priced in, the reason why it is cutting, whether it is just because of cooling inflation leading to a goldilocks scenario

for the fed, or because the economy is softening too fast? where do you see the fed headed when it comes to rate cuts and the motivation behind why they cut? alicia: great question. if it were because of growth, i would not be saying what i am saying. we are on a deflation type called here. that means we will have a lot of cuts next year. 150 for the fed. 100 25 for the european central bank. only because inflation pressures will really come down. actually, they have come down. only a continuation of that process. for europe the inflation is down to 2%. with that, i think growth will be 1.2 percent for the u.s. and 1% for europe. that is a scenario that nations should not worry about. because, its growth, less inflation, and, much lower rates.

that's very good for markets. the key question is obviously china. shery: does that also make boj policy a little easier if we have more solid footing for the federal reserve? there has been so much speculation the boj will need to move away from negative interest rates. when does that happen? alicia: our call is basically may-june. so right after their march review. and wage negotiations. we are seeing wage data in real terms. i think the boj wants to keep. they have said they won't increase wages. -- they want wage increases for you i think it's fair to say they want more before they have evidence of that. and if they don't at least they want a monetary review. so, doing that before i things there is no need because the fed will give them space. the dollar will give them space. we already see a stronger yen.

i think they can move out, which they will come out of negative rates. in may a more elegant way. with wage increases or with a review basically saying that era is over. it's over everywhere in the world for them. haidi: alicia, next year what are we talking about that we should be? what is the biggest risk for 2024 for asian economies? alicia: i am afraid that we have kind of relaxed on the geopolitical after biden said that we should not. i think tensions are coming back. we already see agreements on the understanding of -- disagreements on the understanding of what it means you have a peaceful -- means to have a peaceful environment in the region. the eu china summit ended in despair because nothing was decided. i think this does not bode well.

we have turkey already imposing restrictions on ev's, europe too. it's clear tensions -- trade tensions, because of a very large surplus for china, different imports, and the u.s. basically leading this idea of enough is enough will put a lot of pressure on markets next year. haidi: alicia guerrero always great to get your thoughts the chief asia-pacific economist at north texas as we head towards interbank bill -- decisions. next we hear exclusively from the arm ceo about how the firm plans to become essential to the generative ai revolution. first, tensions rise between israel and russia as the war wage debt rages in gaza. an update on that conflict next. this is bloomberg.

shery: israeli prime minister benjamin netanyahu criticized russia's cooperation with iran in a 15 minute phone call with president vladimir putin. relationships between russia and israel have been strained since the hamas attack in october. alicia diaz joins us with the latest. what was accomplished through the phone call? alicia: great question. a big undertone of the phone call is the increasing tensions, as you mentioned, between russia and israel. a lot of that leads to a growing relationship that russia has with iran. from israel's point of view, they say iran has helped train some of the loss militants --

hamas militants. the investigation is ongoing. the point of the call was really for israel to express some of its discontent. from the russian point of view their readout said this was just about them expressing a need for humanitarian aid. it will be interesting to see how the tensions involved between these two major players over the next coming weeks. haidi: there's a big gap when it comes to the ability to get more aid to israel and the ukraine from the u.s.. a lot of congressional leaders were looking to try to tie this to the minimization of civilian casualties. what is going on now? alicia: there is a big impasse within the u.s. congress. the u.s. did make a decision to fast-track some munitions to israel, which will have to overpass the typical congressional approval that

usually comes when ascending military aid overseas because of the u.s. says this is an emergency. meantime, there is a big gap. so, republicans are saying, that they want stricter border aid. meanwhile, democrats are saying, they want to come to some kind of compromise and they are not willing to reach that given what republicans are proposing. that is often stricter asylum, so this is a conflict that has gone on for decades. congress is expected to leave at the end of this week. it's unclear whether they will be able to get some of this legislation through before yet another government shutdown deadline in january. shery: despite the biden administration backing for more aid in israel we have seen its rhetoric around the civilian casualties in gaza strengthen and become more critical of

israel. what are we seeing in that relationship? alicia: even amongst lawmakers in congress, broadly, people support sending aid to israel. there have been more key players stepping up saying, they want even conditions for sending aid. that is something that likely will not be passed. but, it does speak to the impact of the humanitarian conflict in gaza right now that there are some democratic lawmakers saying that that is something they would hope for. even the secretary of state antony blinken is saying he sees a gap between israel's intent and the actual impact on civilians in gaza. the strengthening rhetoric over the past couple weeks ensuring that innocent civilians are not in the crossfire is. i think -- crossfire's. i think it speaks to what is at stake in the conflict going forward. shery: we continue to watch the backlash towards high-profile

college campus leaders that testified in front of congress about antisemitism. just a tweeting he penned a letter to harvard's governing boards over the weekend. we have already seen increasing pressure on plotting gay and louise made bills resignation added to that. what is the latest? what are we expecting in terms of the next steps that this will avoid into? -- evolve into? like you mentioned liz mcgill was a big development over the weekend, her ousting. it will be interesting to see what comes next. there is a laundry list of major names that have spoken out against the -- of the leadership of harvard and some have even pushed for the ousting of the leadership of mid in light of those congressional testimonies. like you mentioned bill ackman, the white house released a statement saying that this was not up to their standards of what is acceptable.

so pressure will continue to grow in the coming days. harvard's board is expected to meet and it will be interesting to see how the pressure evolves. shery: bloomberg reporter alicia diaz has the latest. get a roundup of the top stories to get your day going in today's edition of daybreak. terminal subscribers can get that i dayb as well as on mobile in the bloomberg anywhere app. customize your settings to just get the news on the industries and assets you care about. this is bloomberg.

haidi: the arm ceo says the company is essential to the general ai revolution. he spoke exclusively to

bloomberg on on his role was changed since arms 54.5 billion ipo earlier this year. rene: we have been public now for a few months. i feel like the eyes are upon me more than they were prior. on the other hand, i've tried to think about it in terms of the future of arm that is really not measured in what we are today but what we will be in the future. i spent most of my time thinking about where arm will be three or five years from now. on one level yes it has changed because the eyes are on us and we are a public company. we have to meet our public company and do what we say we will do. on the other hand i want to say maybe not so much has changed. because i am thinking five years away the same as i am thinking today. tom: how do you balance the investors in the company now, new investors, and legacy

investors and softbank being the big gravitational force? how do you balance that as demands? rene: arm is a company hard to look at quarter to quarter because the technology today will end up in products three heaven four years from now. while financial reports are important, they are the result of strategies put in place a number of years ago that was successful. this was our neo verse product line for the servers, automotive product lines. you are seeing those come to bear. we try to make sure investors understand that while the near-term results are important is also is important to think about long-term and where we are going direction only. >> you have been the building blocks of the digital world, digitalglobe, digital economy. at this point we are focused on generative aia reshaping the digital ecosystem weep out of in or will be living in.

what role do you see arm playing in the transformed digital space in the years ahead? rene: arm in the last 30 plus years has been foundational to computing in a way no other computer architecture before or after it has been. 70% of the world population touches arm today in some way. we were well known for smart phones and before that non-smartphones, feature phones. the arm is today is not only more diversified around data centers, automotive, iot, but it is ai and ai workloads finding their way into every application , whether it is your thermostat or your data center. arm it be there. for us in the upcoming years and decades i think arm will be foundational to everything with ai. >> so, you are central right now the digital world. you will be essential in the generative ai reshaped world ahead.

rene: you cannot run ai without arm and ai will be in everything go electronics device we use whether it is the smallest device in your home or the largest data center in the wild. tom: every ai executive i speak to says the scramble for compute is front and center along with the fight for talent. how do you see the fight for compute going forward? rene: the next couple years we will see increasing demand for more and more compute. it will drive a high degree of need for power efficiency. data centers require hundreds of watts, megawatts, up to the gigawatts of energy. we don't produce that much energy as a planet. we have limitations relative to fossil fuels. limitations to sustainable. a rush to get to power

efficiency around the computer models will be very significant. that's great for arm because of the dna of our company is around power efficiency. haidi: the arm ceo speaking exclusively with bloomberg's john mckenzie. there is much more to come on daybreak: asia. this is bloomberg. this is bloomberg. (announcer) enough with the calorie counting, carb cutting, diet fatigue, and stress. just taking one golo release capsule with three balanced meals a day has been clinically proven to repair metabolism, optimize insulin levels, and balance the hormones that make weight loss easy.

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haidi: 2024 could be a make or break year farce trillion prime minister out -- anthony albanese as alexion slim with his approval rate plunging to 40% from 62% last year. australia reporter ben wescott joins us. how is the pm setting as he reaches the halfway point in his term after some disappointment this year? ben: absolutely. anyone who knows remembers this time last year, a leader that was ascendant, planning to spend several terms in power. things are grimmer after the past three months. with the failure of a signature voice to parliament referendum in september and october and then the two months he has had with stubbornly high inflation that has placed a -- led to the reserve bank increasing interest rates. and now, immigration crises with the high courts.

that has seen detainees released into the streets of australia. level with the opposition central right liberal national parties in the polls and without an easy again in 2023 at a point far from the previous year. haidi: how important will 2024 b for valve albanese government? ben: it will be really crucial. for albanese regaining his fortunes. 2023 could potentially be an election year for the government. albanese might call an early election at the end of next year depending how inflation is trending. before that point, he has to deal with these stage three tax cuts, introduced by the previous government to deal with index

bracket creep for the government. given all of that, he will have to shift back on course to put him ahead of the opposition if he is planning to introduce new legislation over the next year court best year. haidi: of course, one of the i guess unpopular aspects of the cost of living crisis on immigration. we have seen this in new zealand as well edit similar for australia. are we seeing changes to immigration policy? ben: our new immigration strategy will be released today by the albanese government. it has a number of aspects to bring inflation potentially below record levels we have seen over the past year. the economic figures released later this week will so -- show 510,000 net migrants to australia over the past year, the past financial year, that is. that's not only 100,000 more than was expected in april, but

about twice as many as usual. because of that, the number is causing consternation in australia particularly in the housing crisis. the government announced the strategy today in hopes of bringing that back down, including a crackdown on student visas being abused to bring in low skilled migration. and, special visa classes to lure in migrants including people earning over 130,000 a year getting a special seven-day visa pass. shery: bloomberg's australia government reporter ben wescott joining us from canberra. here are other political headlines from around the world. egyptians began voting sunday in a three-day election with president of death auto lcc all but certain to win a third term even as the north african nation grapples with its worst economic crisis in years. the most pressing issue for the egyptian electorate is the

soaring cost of living with inflation at an almost 35% clip -- about almost since three currency devaluation thoroughly last year. javier milei was a in as argentinians -- argentinians president and warned argentinians will have to endure pain as he works to pull the country from an economic crisis budging spending cuts and saying the act -- economy will worsen before it turns around. the chinese and philippine vessels faced in multiple clashes in the south china sea over the weekend as tensions over maritime territory continued to escalate. the philippines see task force says it's vessels were damaged after being directly targeted by a chinese coast guard ship with a water cannon. china's coast guard says the philippine vote ignored the warnings and deliberately collided with its vessel.

haidi: look at how we are trading so far. about 35 minutes or so into the start of cash trading in sydney with a little bit of upside, .2% there as we could see some major gains into the rest of the asian trading session. we are seeing a big week ahead for central banks with the fed and a number of other major decisions affecting that, 16% of the global economy. in sydney introducing particular strengths up by about 1%. industrials as well as consumer names are doing quite well so far in the early part of the session. new zealand looking pretty flat with immigration, we heard from the new prime minister singh to record level of emigration in new zealand is unsustainable. they expect that to slow. we are seeing singapore nikkei futures up by about 1.2% as we continue to watch for what happens with the central banks

given how intensely the pricing has changed over expectations of rate cuts. we are getting readings for u.s. consumer prices, retail sales for november. a compressed schedule when it comes to treasury options and, the fed's final meeting of the year on the docket as well. a busy week as we head into the second part of the september. -- december. s&p futures look largely higher, about one point -- .1% at the moment. the dollar yen at 145 at the moment. some work has been done by the weakness we have seen in the greenback. the yen at the moment of trading. the dollar looks mixed in the early part of sydney trading. pretty range bound as well as we get into the policy decisions. dollar-yen ending the friday of about .6%. the fourth -- trimming the fourth weekly inclined to about

1.3%. the aussie dollar, seeing a little weakness there. we had a weekly declined to about 1.5%. snapping a three-week rally. we heard a little earlier suggesting there is more of an upside there for the aussie dollar given improving fundamentals and given the dovish outlook for the fed. next, we get the market outlook when it comes to japanese markets. neuberger berman's kei okamura joins us with investors watching the next steps when it comes to the boj. this is bloomberg. this is bloomberg.

a few years ago, i came to saona, they 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.

shery: it's time for japan ahead. machine-tool orders for november do later on monday. it data in october fell a revised 20.6% year on year. watching for the november money supply expected in the next few minutes. the stock grows 1.3% year on year from the previous month and asahi newspaper now reporting japanese prime minister kishida will fire 15 officials including his trade minister amid a scandal over slush fund's. the trade minister would be the second help a member of the cabinet to be replaced following chief cabinet secretary matsuno.

haidi: politics reporter isabel reynolds joins us out of tokyo with more on the funding scandal that has just wide ended. what do we expect from prime minister kishida? isabel: this scandal is broadening wider and wider and some say now it's probably the worst financial scandal in the japanese government since the 1980's. since the famous insider trading scandal at that point. japanese prime minister fumio kishida may opt to put into media reports to replace the 15 ministers from his government. there are top ministers and also junior ministers, vice minister's. all the ones that belong to the so-called abe faction within the party that seems to have been most deeply involved with this plan to kickback funds to lawmakers and not have them declared in their campaign funds

so they, effectively, can be used for anything. haidi: doethis mean for his administration given that kishida has been struggling with low public support? isabel: he is already an extremely unpopular prime minister. some polls show he is the least popular prime minister in more than one decade. he is not starting from a good point. i think he is probably trying to bring this under control by firing these people who are mostly deeply involved. but, there have been reports the practice spread beyond that faction to other factions, other parts of the rbp. it's unclear well this will end and how far it will affect the whole party itself. on the other hand, if you look at the opposition in japan, support for them is extremely weak still. perhaps they don't really have arrival. if it comes to election, is there anyone that can take over that is also very unclear. it's a little bit of a mess at the moment and very fluid.

what's politics reporter isabel reynolds in tokyo. the pipe -- despite japan's political landscape we have seen big upside in the stock market in japan with the nikkei gaining more than 20% already this year. there has been a lot of optimism about evaluations and corporate governance. and a series of reforms in the japanese market. our next guest says japan is finally emerging from its loss to decades as it the government, companies, and shareholders all work together. kei okamura senior president and portfolio manager at neuberger berman joins us. we heard from an -- from isabel how big of a mess the political situation is in japan. i lived in japan for five years before the abe administration and i saw so many prime ministers go through this revolving door. if we have more political uncertainty in japan what will it mean for the economy on the market? kei: yes.

good morning. thank you for having me today. you are right to point out that these political issues are never a good thing for markets especially given that it does lead it to some uncertainties about the outlook for japan. that said, if we look at the various reforms the government has pushed through in 20 23 starting with the tsc going onto the financial service agencies corporate governance action program, the new revised m&a governed -- guidelines for the trade ministry, these are rules, regulations, and guidelines that will be very hard to unwind and rollback. as we have been seeing in the markets in the last several months many companies have started to really work for the interests of minority shareholders to unlock value and raise capital efficiency and we think these things will be here to stay. going forward into next year, it's to be determined how the political situation shapes up. as long-term investors, we

remain hopeful the direction of travel for the market is in the right direction. shery: is that also your thought when it comes to bank of japan policy? we are also starting to factor in a potential change, especially, perhaps, the laste central bank really turning positive in terms of intro -- interest rates as soon as this month is now market pricing. what will be the invocations of that momentous change? kei: yes. i think this will be a pretty big change for the japanese economy certainly. we have to think, though, that it is not a situation that has sprung up overnight. the bank of japan had said that it's looking to normalize its monetary policy going forward. given the pickup we are seeing in inflation, especially in the last six months to one year, it

is quite likely the bank of japan will move to strict monetary policy, whether it happens during this month's meeting or perhaps the meeting after, we have yet to see what the outcome will be. but come at our firm, we continue to believe the bank of japan will normalize monetary policy and it will likely start with the yield curve control, and possibly at the same time with negative interest-rate policy and from their move to positive interest rate policy. what that will mean for us is this will be for certain sectors, quite attractive. like financials. where would you think several institutions in that market will likely see a more conducive business environment to make profits. i think at the same time for the rest of the economy i think as long as the bank of japan continues to take a measured approach in terms of monetary policy tightening it should mean the bank of japan will remain weak then gradually appreciate. which, according to the management we are speaking to, they have told us they are quite

comfortable with the yen appreciating as long as that happens within a pace that is not too disruptive to the business forget as long as there is no volatility. shery: what levels of the japanese yen are we talking about as we see the change from the boj? we saw appreciation last week just on speculation alone. kei: focuses on the fundamentals of the company. we don't really have a view in terms of whether they get it will be in six months to a years time. that said the the companies we are invested in and the models we employ to analyze the companies or look at the end to appreciate next year's certainly are not looking at 120, 1 hundred 10, but somewhere in between there. where we are today i think would make sense. if we look at the figures, most of the companies we own have been able to make plentiful

profits in the past with those levels. so we are not too concerned. i think it's important that mid to long-term we continue to focus on companies that will really prosper whether the yen is at 70 or 145. what we mean is it is important that companies are able to manufacture in their end destinations so the top line matches the cost structure and therefore we do not see too much disruption in how the company generates profits, irrespective of where the currency is. shery: does that include smaller companies? small and mid-cap companies? we aren't just talking about a stronger yen. we are perhaps talking about higher borrowing costs. i wonder, on what level will that be an issue for companies? kei: i think for japan at the moment, the issue of higher borrowing costs is not too big of an issue. i mean, currently at the moment

the interest rate is in negative territory. whereas, the rest of the world, the u.s., europe is north of 4% or 5%. for japan's economy, it will be even more important how positive wage inflation continues to sustain itself midterm to long-term and whether consumer prices will be able to normalize between 2%-3%. that will be important for the midmarket you are referencing. i will add going into 2024, it will be a testing year for the entire japanese market and we are particularly interested in the japanese equity market because we think there will be winners and losers. especially when it comes to the winners, these are companies that will be able to continue to pass on rising costs. that will be able to continue to maintain pricing power irrespective of where the consumer price inflation will be going forward. the losers come on the other hand, i think they will start to have difficulties maintaining

pricing power in this environment and it might not bode it too well for share price is going into the mid to long-term. shery: do you have a view on where the stronger companies are concentrated in terms of sectors or sizes of businesses? kei: sure. we take a very bottom-up approach across all companies. for instance, if we were to look across the sectors we tend to remain overweight in say, information technology and, of course, financials. the equipment side of health. these companies are really, when you look at the sectors, they are dominated by companies that have real global market share. they have technology. they have the mode. they have strong brands. they have a really big presence in some of the growth sectors of the economy. i think that is an important part of the company. to be able to drive growth and at the same time maintain pricing power.

the parts where we do not have too much exposure yet is in energy or utilities. there we do have some concern about the mid to long-term. about whether companies in those areas will be able to manage their own earnings visibility going forward. a lot of the companies in these sectors are susceptible to commodity price fluctuation, or, the government energy policy guidelines. therefore, we try to stay away from that. but in the sectors i mentioned earlier we do think that going into next year they will likely see a very very good year, just, given the changing macroeconomic environment. shery: great to get your insight, senior vice president and or folio manager at neuberger berman doing a deep dive into the japanese economy and markets. we have been seeing the japanese yen see strengths last week. we are continuing to watch for the expectation of boj policy goes from here. catch japan ahead every week

every monday at 8:40 am. if you are watching in tokyo. 7:40 p.m. sunday in new york. bloomberg subscribers can watch live on the terminal using tv . this is bloomberg.

shery: raised ball superstar show a otani's record $700 million tenure contract with the l.a. dodgers may bake -- be a boon not just for him but his corporate sponsors. hideo cassano joins us from tokyo. what impact do you see from otani's record deal that potentially plays out for japanese equities? hideyuki: a lot of people will talk about the deal and some of the main bid for -- beneficiaries will be has corporate sponsors. another potential segment's forwards. there are not many, but there are a few japanese sports where makers. it's not entirely clear what

kind of benefit of show a otani's big -- show a otani's big deal will bring to the bottom line of these companies. even if ohtani becomes popular it does not mean the companies get popular. nevertheless it is uplifting news that will probably be positive for companies. haidi: doesn't help we have seen some of the worst weeks for the nikkei 225 in terms of how much upside this could actually provide for the broader markets? what have we seen in the past? hideyuki: yeah. the main factor that has hurt japanese stocks was the yen. the speculation about the bank of japan possibly changing its policy much earlier than previously thought. now, there's discussion going on in japan and probably also

outside japan. about whether markets have it right or have rightly interpreted the boj comments. at least, the signs in the u.s. is that the economy is going to a soft landing rather than a hard landing seems to be helping the broader global shares. japanese shares are likely to rebound today. that is also supportive for the market. shery: we will watch those stocks and sponsors. hideyuki sano in tokyo. market opens in tokyo and se oul are next. this is bloomberg.

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asia's major market open as we head towards a series of federal bank decisions this week including from the fed, d.o.b., and cboc. effort from china's top leadership that they may strengthen financial fiscal support. haidi: whether that will be oppressive and what markets are building up for the fiscal push into next year, they could be disappointed by the central economic or conference that should take place in december where it will have goals for next year. that is one thing we need to watch out for. the other is the 60 hour window in which we get all of these central bank decisions. shery: we have stronger-than-expected u.s. jobs data, sending the u.s. dollar higher and the other side of the trade, look at the japanese yen is holding around 145 level. against the greenback.

you looking at the nikkei, coming online to the upside, up 1%. this has to be put into context, last week we saw one of the worst days given the resurgence of the japanese yen on speculation that the bog was moving towards ending the negative interest rate policy. you see the 10 year jgb holding .79% level. take a look at what they are doing at the moment because we had seen it really rise to the one-week high and we are getting also a trade data for the first 10 days of this month. it is a growth of 3.3% year on year. and it comes to the imports numbers, 15 .3% year on year which leads to a deficit for the first 10 days of this month and 1.41 billion dollars. suffice to say that we are seeing an improvement on

economic data out of south korea, especially when it comes to the trade numbers. exports are celebrating on the back of the rebound in semiconductor demand. such a key market for some of these economies in northeast asia. haidi: yes. we already have a key week, look at australia, 10 year yield rising, also adding about the same as it this morning. a couple of headlines are watching for the plan to cut immigration by cracking down on student visas and we are expecting the budget update. expected to reveal a lot and a level of debt according to the treasurer. we are seeing q8 10 climbing about four basis points in the mornings. taking a look at the aussie dollar, leakage 65-81, -- 65.80 one, upon back weakness. this comes down to what we see

when it comes to the fayette and how treasuries and the dollar reacts to that. we did see that weekly gain for the greenback going into the end of last week. this is coming to the treasury yields at the moment. pretty unchanged in the early part of the trade when it comes to trade and the future sessions. they did drop on friday, the strong jobs data, pulled back a little bit on this, intensifying in the past two days and weeks. we are seeing that slide in australian bonds as well. when it comes to the search in -- surge in yields, managing expectations for the fed to ease policy aggressively next year after a jobs numbers came through. it is that big week from washington to frankfurt, to london and beyond, these are the final decisions of the year for these major central banks this year.

let us bring in daniel, the head of equity strategy at china wealth management. great to have you with us. shery: we need to see marcus take a breather in terms of managing these expectations? >> last friday's number beat expectations. that kind of, -- it should i say, small confusion in the markets. people were expecting that from march of next year. that would be starting to cut. now, it is not so sure anymore. the fed is probably going to be holding this and they will site data watching again. and there could be some of the data that could be over the next few weeks in which case, this would delay the rate cut expectations. people could be waiting and seeing at this moment in time.

haidi: when it comes to the other central banks who are watching, what opportunities you expect to see if we see some of these policymakers hang back a little bit from where market expectations are for the fed? >> basically, earlier in the program, you reference the doj case, we believe that they are going to be tightening fairly soon. the fact that the economic data has been relatively strong. the inflation seems to be on par with what they are expecting. that could be one that can move the markets a little bit. we are expecting that. the dollar-yen could rise

through 139 over the next year. that could mean that the league we have seen in japan, you could see some kind of stalling or rotation, rather. sectors like that banks would be doing pretty well in that aspect. in japan, it is not about planning to be there anymore, it could be at the sector selection and i could be an opportunity for investors. haidi: are there opportunities for china as well? saying fiscal support going into 2024? there is a lack of investors and disappointed by what policymakers come through with. >> china is an interesting one because from a flow perspective and from a technical perspective, we saw that tencent in that space went from 22,000 at the beginning of the year to around 16,000 at this moment in time. it is interesting to note that over the last few weeks, the

volume, the turnover in the hong kong market actually has increased quite a bit. it is actually around 40% of what we have seen over the last three months. it seems that there is a change of hands. the weak hands are capitulating over the last few weeks. the money goes, the stocks goes into the hands of the strong holders. when that happens, it seems that around these levels there is reasonable levels of support it seems. whether the stimulus potential this week materialized were not, it seems that the market has relatively limited downsize from here. in q1 they could see some potential upside action and the hong kong china equities because of that. shery: what about expectations

when it comes to european equities? do you see further demand? depending on what we hear from lagarde this week? >> europe, basically, because over in the u.s. the recession probability has decreased. it is probably going to be spilling over to the rest of the world. we believe that europe could be helped by that fact. it seemed that there are a number of selected large cap names that are doing relatively well in europe. roughly about 8-10 of them. they're the ones who are contributing over half of the returns in the european equities. right now the fundamentals are looking ok. they spend across different sectors.

at this moment in time there could still be some upside to european equities we believe. haidi: what about emerging markets? >> ok, we talked about china. china, of course is very much linked to the rest of the emerging markets and a to china. -- and linked to china. those, that generative return from the domestic activity is more than the others. it would probably be the ones where the investors have been looking at. for example, india. india remains a strong structural story because 70% of their working class, 70% of their population is still in the working class. it is still working. that is very strong demographics. also the consumer side is going

pretty strong. 40% of the global middle class is expected to come from india which is a hefty step. right now, if you look at the indian market, they were helped by the favorable recent election results. they are looking pretty good at this moment in time. it has always been expensive. because of that you could see some potential stalling of the rally. on the pullbacks it could be interesting. haidi: always good to have you with us. the head of equity strategy at china wealth management. israel and russian leaders speak as tensions grow in gaza and russia's growing ties with iran. hbc and the productions for 2024. the holiday season gets underway. this is bloomberg.

♪ a few years ago, i came to saona, they 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: you are watching daybreak asia, china's top leaders have a to strengthen physical support raising economist expectations for a growth goal of around 5% for the next year. shery: let us bring in our correspondent in hong kong, what sort of support are we talking about and how much of a difference will it really make to the chinese economy? >> it sounds like the government is talking about more fiscal spending. the statement from the bureau said the economic growth is

further up the agenda than it has been. fiscal policy is a big part of it. they are putting focus on with central bank can do big. indications are more similar to becoming an maybe more on the other things. it suggests a growth target of 5.1% for next year. this year's growth target will be met. mostly held by the pace from a year ago and what is going on with the lockdowns anyway. if you come in 5% of next year it would be part of me and it may suggest more boring anticipated right now. it is important to say that the message that came out of the office suggests gangbusters. it sounds like they are putting more focus on growth than they have been and will on the physical side. that is important if 2024 is a stronger year for china than it has been.

haidi: we usually get the simple economic or conference in december as well. what are your expectations given the readout in terms of what the medical and economic targets and priorities will be? >> i think, it has been such a disappointment for china this year. this was meant to be the year of a big rebound, post covid and chinese tourism and consumption. the investment sentiment towards china so negative in terms of portfolio flows and of course actual fixed investment. the message and comes out of the authority line all weekend for the were conference and the channels but there are looking back to put folks in growth. perhaps china is getting serious and trying to push past us. get consumers going. i think regardless of a structural taken china, securities have focused their. it is one of geoeconomics and pensions with the u.s. and other

key rivals. that will continue to overshadow the growth story. towards china even if we do see folks in both, and a deficit, both 3% again. and nothing that will turn around in a hurry regardless of the conference. haidi: in terms of the pboc we have seen monetary support through boosting the liquidity instead of rights. is that the trend that will continue through next year? if not just cut rates? >> the statement over the weekend, they did not put much of a focus on the pboc. it is putting it back on the government spending side of things. as you know, china's economy does not need another interest rate cut. estill has got to do that and scope to get into my new markets and use positions where they are. what would help them next year is that other central banks are

moving in the same direction if they are easing at some point and that might help out the exchange rate point of view. the story for next year is government spending. for the pboc and i am not sure, trying to turn the economy around. haidi: that is our correspondent in hong kong. a tech firm with exposure to china rise to a fi -- rides a fine line, how a chip is navigating these geopolitical tensions surrounding the sector. >> i think my most tech ceos we run very fine lines these days. i think ceos, 10 years ago did not talk to government officials with nearly the frequency that we do today. we comply with all of the export controls whether it is from the u.s. or other parts of the world. china is a big market for us. 20 through 25% of the market today.

china looks like the rest of the world in terms of the ecosystems they have built and the software that runs on the processors and the markets that they want to address. the big markets that are going for us in china are unsurprisingly automotive. automotive's and ev's are going very fast in china. it is how to travel to china. >> the u.k., rich and the u.k., it is a majority owned by japanese companies, softbank lifted -- listed in the u.s., what role do you see the u.k. playing for arm in the years ahead? >> the u.k. is our home. it is our headquarters. we are always going to be here. the u.k. is incredibly essential to the future of arm in so many ways. our biggest chance for growth is getting talent in. we are committed to the u.k. and again the u.k. will be so critical for our future. >> the prime minister and chancellor want to create the

u.k. as the next silicon valley. is that realistic? >> there is only one silicon valley. it is a unique area and terms of its ecosystem, the universities and how the whole sector works. does that mean it cannot be imitated? or replicated on some level? not at all. i think the government here has been doing a fantastic job and cambridge itself is a very rich community of small companies, incubators, the universities. >> what would you say to any incoming government that you would want to see happen in those first 100 days? >> we are committed to the u.k.. this is our home. we are born here. we intend to stay here. please make it easy for us to attract world-class talent. attract engineers to come work for arm. that is the largest limiter that will have for growth. it is access to talent. if that gets any more difficult,

with a change in government that you described with the next election, there would be a headwind that i would not want to have to engage on. haidi: that is the arm ceo speaking with tom mackenzie. shery: get a round up on all of the stories need to know to get your day going in today's edition of daybreak. go to dayb , it is also available on mobile. you can customize your settings so you only get the news on the industries that you care about. this is bloomberg. ♪ i'll be home for christmas. you can count on me. please have snow

and mistletoe. and presents under the tree right now, all over the country, kids at shriners hospitals for children® are able to go home and be with their families for the holidays. and it's only possible because of the monthly support of people just like you. thanks to a generous donor. every dollar you give can help twice as many kids like me and have double the impact. with your gift of just $19 a month, only $0.63 a day, we'll send you this adorable love to the rescue® blanket as a thank you. and a reminder of the care you'll be providing so kids can be with their families. christmas eve will find me. where the love light gleams.

it only takes a moment to call the number on your screen. or you can visit loveshriners.org right now on your phone or computer. thanks to a generous donor, your gift will go twice as far and help more kids like me. because every child just wants to be home for the holidays and your gift makes that possible. your call is the best gift of all. your gift will be my favorite christmas present this year. thank you for giving. please call the number on your screen or go online right now with your monthly gift. and when you do, your gift will have two times the impact. haidi: the is really prime minister has criticized russia's corporation with a run in a

phone call with vladimir putin. the relations have been estranged since the hamas attack in october. let us get more from bruce, what do you here in this conversation? >> there was a call between the two leaders that lasted for about under an hour. in the call according to netanyahu's office the is really prime minister talked about israel's concern about russia's work with iran. russia has certainly intensified its partnership with iran when it comes to rely on iranian drones in the war in ukraine and the kremlin for its part said that it spoke about, that putin spoke with netanyahu about how russia convinced terrorism. that there needs to be action to

protect civilians. at the same time over the weekend, night at the same time, the prime minister netanyahu spoke with the german chancellor schultz, with president micron, again, talking about the war according to netanyahu's office and his call with the prime minister schultz -- german chancellor schultz. that is according to german chancellor's office. the german chancellor spoke to the prime minister about issues such as protecting civilians in gaza. haidi: as the prime minister continues his war on hamas, we have seen u.s. leaders trying to get more aid before israel. shery: what is the latest on that front? >> there are negotiations currently underway, president biden has requested under $6 billion rogue emergency aid for

israel, ukraine, and -- requested 106 billion emergency aid for israel and ukraine. negotiations are underway. the lead negotiator for the democrats chris murphy from connecticut says that currently, republican demands are what he called unreasonable. the head of one of the republicans senator langford from oklahoma said that democrats are not serious enough about security. chris murphy expects that the white house is going to get more involved in these negotiations this week. time is running out because the christmas break is coming up in order to get this aid passed this year. they will need to step up. there are republicans who are opposed to a two ukraine and principal. and so, republicans are not

just walk away from this. that is leverage that they have the democrats in trying to force the biden administration anti-the democrats in congress to agree to restrictions on say, an asylum for people coming across the southern border. shery: we continue to see the file that when it comes to commercial testimony by harvard, m.i.t., and penn presidents. >> yes. there was testimony last week widely criticized by people from all sides of the political spectrum of the three university leaders who were asked about university policy regarding calls for genocide, it gained a narrow legalistic answer which did not really satisfy their critics who said that these universities are not taking antisemitism seriously in the

way that they do other meat -- hate speech. you have seen already the resident of pennsylvania has stepped down, the chairman of the board has stepped down, the university m.i.t. has expressed support for its president, a lot of attention is focusing on harvard, the president who has been subject to a lot of criticism. has issued an apology for her statements in congress. saying that words matter and we will see how it plays out. whether she will be able to keep her job, so far the situation is very uncertain. haidi: take a look at how european features are coming online in the asian trading session. shery: we saw the powerful rally continue into the friday session and we are saying futures pointing to even more upside after european stocks at the highest level in nearly two years.

we have already seen the november rally extended into the december -- into december. things are approaching 10% -- gains are approaching 10%. gains have been exhilarated after a stronger-than-expected u.s. job numbers not to mention we saw the likes of luxury and travel stocks gaining ground expectations are more physical support coming from china. big news this week in europe, the expectation that the european central bank will maintain borrowing costs and keep them there until june. that is according to economists surveyed by bloomberg. we will have more on daybreak asia, this is bloomberg. ♪ the power goes out and we still have wifi to do our homework. and that's a good thing? great in my book! who are you? no power? no problem. introducing storm-ready wifi.

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shery: your watching "daybreak asia". chinese stocks in focus as consumer prices fall at the steepest place in four years and the politburo manages a targeted policy. let's get a preview of the markets open in mainland hong kong with our stocks reporter. we are seeing a risk-on tone in the broader markets across asia. can we expect apside for the chinese as it's from fiscal support as well? reporter: you are right. i think over all people are still digesting the takeaways from the politburo meeting contents which were released after market close last friday. i think one of the key things people are looking for is whether the government is going to announce anything that is related to property going forward, because in the public room meeting, it did not mention property at all. we have seen that property developers plunging at the end of trading last friday and that is one of the key focus.

but as you just said, the region has been on the risk on mood. also, people are still expecting beijing to do more in terms of some easing measures on the fiscal and monetary side next year. so definitely this is something to look forward to. the other thing we are looking at is the chinese government, the regulatory, the security brokers, they are trying to cut commissions and bring more money into the stock markets. so we are going to see whether that will boost sentiment as well. in general, people are still trying to see whether there is more of a message from the government. haidi: what is the risk of disappointment for these markets? particularly if we don't get an impressive set of priorities or goals from the economic conference this month? jeanny: i think the timing of

this economic conference is still as expected. and also, some of the key points , for example, about property, people are still expected the chinese government to do a lot more. right now the fiscal spending, people are saying about 3%, and also the nominal gdp growth for next year about 5%. it is still not enough for the property market. that is one of the biggest issues for the whole chinese stock sentiment. so i don't think the property market sentiment or the stock market sentiment can be revived soon. you are also seeing both china and also hong kong stocks testing a lot of critical levels, which may indicate that we could see some technical rebound going forward, may be this week or next week.

but really, for the market to have some long-term outperformance originally, it still needs some policies. haidi: are asia stocks reporter jeanny yu there. take a look at the picture across asia, half over to the start of trading in japan and korea, 1.5 hours to the start of cash trading here in sydney. a big week. early gains going into fed meeting week, not justified, but also key u.s. data including cpi. as well as other central bank decisions. the nikkei 225 is up 1.9%. quite a strong performance out of japanese equities. when we look at the statements we are seeing, every single is in agreement but text, i.t., industrials, health care and energy are some of the sectors outperforming higher than the rally, even beyond 2%. the kospi is seeing marginal gains. we are seeing more dust again when it comes to trading in

sydney, some of those resources stocks given the fluctuating expectations of how much monetary support, physical or otherwise, we could see from china. new zealand stocks are on the back foot. we have some commentary from the prime minister about what they see as unsustainable levels of immigration. immigration strategy change is expected from the other government later on today as well. the broader msci asia pacific is up by 0.3%. we are also watching domestic politics of japan. japanese prime minister fumio kishida saying he will work to restore confidence in politics. that is as japanese media report he is planning to replace 15 officials amid allegations of unethical funding. for more, let's bring in over east asia government editor jon herskovitz. what do we know about his plans? and those of the of the situation for him to potentially

have to act? jon: we had a report in a newspaper over the weekend that he is looking to replace 15 ministers and vice ministers from the big attractions within the -- from one of the big attractions within his party. it would be one of the biggest changes for his government which is just over two years old. it's a bid to restore trust after more revelations are coming out day-by-day. he is trying to make changes and tightening it to -- timing it with the budget with is supposed to, wednesday. shery: what does this mean for his administration? it has been plagued by low public support already throughout. jon: exactly, it is difficult to restore trust, especially with a scandal like this one. it's a drip, drip, drip scandal. there will be other issues that will drop you in a few days. he may try to get out of head of it, but there will be details

that are not going to look good for the ruling rdp, for his government. he is also trying to support for his economic policies. it's a difficult period for the prime minister, the public has not warmed to what he has put out there, and he is trying to reverse his poll numbers which are at the lowest in a decade for japanese premier. shery: our east asia government editor jon herskovitz there. -- -- some other political headlines from around the world philippine president ferdinand marcos, jr. has slammed china's actions against for new initiatives in the south china shapes over the weekend, calling them a blatant violation of international law. the philippines see task force says it's vessels were damaged after being directly targeted by a chinese coast guard ship with a water cannon, while another filipino boat was slammed. chinese coast guard said the boat ignored warnings and deliberately collided with its

vessel. egyptians began voting sunday in the three daylong election, with president abdul fattah al-sisi all but certain to win a third term, even as the north african nation grapples with its worst economic crisis in years. the most pressing issue is the soaring cost of living, with inflation running at almost 35% after three currency devaluations since early last year. javier milei has been sworn in as agitated as president. in a message to the nation, he warned argentines they will have to endure additional pain while he works to for the country from an economic crisis. milei has pledged spending cuts and said of the economy will worsen before turning around. his cabinet picks triggered a rally in the nation's dollar bond. plenty more to come on "daybreak: asia." this is bloomberg. ♪

a few years ago, i came to saona, they 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.

>> well, china is the dragon that has awakened, but i think it is still half sleepwalking. so hopefully as we usher the year of the dragon next year, you will see china fully awoke to the prospects of air travel recovery.

shery: the association of asia-pacific airlines director-general. let's get the outlook for the travel and transport industry is going to the holiday season. the head of transferred research for apac at hsbc dentist now. great to have you with us. we just heard from him to read what was interesting from his comments is that we are seeing the recovery in asia travel, but it has really underperformed the global rebound. and a lot to do with china. what can we expect in that market into the year-end into 2024? pranash: absolutely, thank you. as you mentioned, byron china, most of the world travel has reached pre-covid levels. even china domestic has achieved pre-covid levels in the past year or two, the only missing

part was international travel. with an effort to visa free deals either with malaysia and now with singapore, probably the are moving in the right direction. within china's international travel, travel to the u.s. with the weakest link. we are seeing actions happening with china's travel to the u.s.. it has reached 22% and that will single-handedly drive next year's growth for china and as a result, for asia. shery: with more china-u.s. flights scheduled given the solving of that relationship, how big of a boost will that be? >> if you look at china's international capacity, they are holding at 53%. if you look to the big three chinese airlines, they were aiming to get to 50% to 80% of the end of this year and perhaps reaching full capacity sometime next year. we are slightly more cautious, we are modeling that it will be early 2025 when china's international travel will reach back to pre-covid level. needless to say, from current

53%, even if they reach 80% or 90% next year, you are seeing international travel doubling on average in 2024 versus 2023. shery: what does this reflect about what we can expect from february 2024, around china's new year holidays? parash: already we are seeing, if you see the commentary from trip.com, we have already seen a lot of search activities built up going into the chinese new year and also into the midautumn. especially with the visa, free access or the 30-day visa free access to malaysia and singapore, those are the two markets you will probably see travel surpassing the covid level. singapore has already achieved close to 80% as we speak, so probably those two markets will see the growth along with japan and thailand. shery: tell us a little bit more about whether thailand, japan, and what other markets will be the bright spots for 2024. parash: if you talk about the

growth, i would still say that it will be the u.s., because it was pretty much not moving at all in 2023. but in terms of the volume, it will be southeast asia. it will be malaysia and singapore. in terms of sheer volume, we will still say it will be thailand, japan, and korea. shery: shery: what about the shipping market? is it a different picture were talking about containers and actual trade volumes? parash: yes, shipping, you have to see containers and tankers. in some of the markets we have seen recently with dry bulk. when it comes to the container, we have seen free to trade bottom out somewhere around september, that given the excess capacity impending for 2024 and 2025, our base view is that free freight trade will bounce to the bottom. it will be difficult going into 2024. if you look at volume data, you

can see the global trade has started to bulk up, some talks about excess inventory have cooled down. i don't think demand is much of an issue. on the basis such as this, demand is unlikely to move the needle. if you are bullish, probably will look at 3% demand growth. if you are bearish, you will be looking at flat-ish, but this is against 8% or 9% of supply growth which dampens the outlook for the container shipping going into next year. shery: how much more. will the shipping industry face because of the tougher emissions regulations that we could see in 2024 and onwards? parash: if you talk about from the shipping lines perspective, i would say that the demand and supply mismatch is a far bigger challenge for them. we did some calculation on how much the upcoming regulation in europe from the first of january will cost them. on their overall book, the impact will be less than 1.5%.

this cost, they have seen it in the past and it is easy to past due to the customers. at the end of the day, it boils down to the overall freight trade which is where will continue to see pressure. shery: how much are we seeing progress from these companies to alternative fuel ships and the transition to mark greeni -- to more greening of their business? parash: they are the consumer of that fuel. but they need the support from the oil majors, from the regulators. but for whatever they have in their control, if you look at the sears auto book, i think close to 55% of the vessels ordered have the alternate fuel capabilities. with respect to new ordering, i think they are walking the talk. then you have the leading players who have gone a step ahead in terms of securing alternate fuels such as methanol. but it is just too big it task, and today's

alternative fuel availability is low. shery: as you look into these freight rates and container volumes, especially air cargo, compared to 2023? parash: that is where there is some christmas cheer. let me talk air cargo. we have seen the freight rates from air cargo, particularly from this part of the world, hong kong and eastern china, freight rates out of this region are double that of 2019. that has dealt with the fast fashion, e-commerce supplied by temi and shein have fueled the market, and some of the global integrator's assets benefit from this trend. recently there was a forecast that came out for air cargo next year and it is looking at 4%, 4.5% of annual growth in terms of volume.

so there is cheer on air cargo. bearing in mind at this point in time, it was a lack of capacity out of china coincided with a turbocharged e-commerce cross-border group that fueled the market. 2024 with that capacity coming back probably will see that calm down, but the outlook is much better compared to the container shipping sector/. shery: parash jain, thank you for your time today, with an outlook on the view of the transport industry going into 2024. hsbc global equity sector had for shipping and ports and head of transport research for apac. of course if you missed any part of the conversation, tv is your function. you can watch us live and dive into any of the securities and bloomberg functions we talk about and become part of the conversation by sending us instant messages during our shows. this is. for bloomberg subscribers only. check it out at tv . this is bloomberg. ♪

haidi: jack ma made headlines for comments he made in an internal company forum where he congratulated pdd holdings.

pinduoduo has been winning over customers in the domestic e-commerce market with a range of innovations bursting onto the u.s. market with that shopping app called temu. today's big take takes a closer look at the company posing a challenge to the legs of amazon walmart. let's bring in our china tech reporter sarah jeong who joined us in hong kong. we have been talking a lot about these fast and furious, or cheap and cheerful a guess you could call them, apps like temu, and other chinese linked business like shein. they are really making headway in the u.s. market. sarah: that's right, especially temu. they came in last year and they have soared to the top of app stores and expanded rapidly to over 40 different markets globally. it is increasingly a force to be reckoned with. we saw in may they overtook she

in in terms of overall transactions and the gap between them is widening. definitely an app to be reckoned with and pdd is something investors are increasingly interested in. shery: why is it so popular? sarah: we have seen that pdd build success in china domestically with quite innovative e-commerce models. one is the giving tradition idea of e-commerce where they try to make shopping fun, they include games and rewards to try to stimulate people to come back and use the app and create the social community experience. they are bringing that model to the u.s.. and they have this consumer model where they directly source products from the factories themselves and that allows them to keep the costs as low as possible. it wasn't always easy, though, pdd suffered a few setbacks

after going public on the nasdaq in 2018 permit sarah: one of the big problems they faced especially early on was a proliferation of fake goods on the platform, something we have tried to tackle especially under their founder. it was something he made a priority. now going forward, the big question people are his is house estimable are these low prices and big subsidies beer introducing for their products? haidi: there will also be political challenges for a lot of these china-wade, china linked, china owned companies. sarah: definitely. there are fewer about temu could face the same treatment tiktok has in the u.s.. that has already been a bit of congressional scrutiny but we know that e-commerce is generally not as sensitive a space as social media so it will remain to be seen how much scrutiny that attracts in capitol hill. shery: china tech reporter sarah

is lying joining us from hong kong -- sarah zheng jutting out from new york. broadly green on the nikkei where every sector is gaining ground at the moment, led by ted and health care -- tech and health care and industrials. this is following last week which was one of the worst week for the nikkei 225 so far into the 23 given the surge in million in the past few days. not so much today there where we are seeing downside pressure across the u.s. dollar. look at the kospi, holding steady around the one-week high. we saw the stock market really gain ground last week with the korean won also jumping the most in more than three weeks against the u.s. dollar. we are seeing their trade numbers also improving's lightly, the 10 days of december, experts rising 3.3% year on year. we have seen the acceleration in

the trade numbers for the month of november already, given the rebound in semiconductor demand. the asx 200 is also pointed to the upside, zero point 3% as we are seeing the aussie dollar holding steady after a weekly loss against the u.s. dollar. perhaps a lot to do with what we're seeing in the commodity space with iron four rising to attend month-high. it is a lot to do with currencies and the strength of the u.s. dollar against these asian currencies after they jumped on the payrolls data we saw last week as we head towards the fomc rate decision. not a lot of change is expected this week, but we are setting up for what happens next year. swap traders are expecting less easing because of a resilient labor market. haidi: and not a lot expected, but perhaps a lot expected when it comes to central banks, how they engage in how they

communicate. the messaging. why are they not in a hurry to flag easing when we have seen the data points suggestion that they could? it's the same with the boe as well as the ecb. the bank of england is set to announce its next policy decision this week, policy markets still at odds on the outlook when it comes to rates. that comes two years since the hiking cycle began. also looking at the skewed ecb rate cuts. they are looking a bit risky, but initially regardless of what we hear from christine lagarde. the risk to european bonds, according to analysts, looking asymmetric after a pretty strong rally. a hawkish ecb could lead the markets to really pare back bets on repricing volatility. that is it for "daybreak: asia." markets coverage continues. ♪

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