>> welcome to daybreak: asia or we are counting down to asia's

major market opens. >> australia has come online in the top stories, firefighters are still battling flames after a powerful earthquake killed at least four people. iran sent a warship to the red sea after the u.s. navy -- -- potentially ratcheting up tensions. and asml to china ahead of a january deadline under pressure from the biden administration. let's get you to the market open in sydney coming online after the new year break. january is a slow day when it comes to corporate committee and australia but we see a modest upside with asian stocks new year cheer. the chinese president pledged

economic strengthening and job creation but we see weakness in the futures for australia, 1/10 of 1% lower to start the open and the aussie dollar at 68. 13. we will watch the aussie dollar this year and kiwi stocks are not doing much of anything, fluctuating between slightly lower and slightly higher this morning. japanese assets in the wake of the powerful earthquake that killed at least four people, triggering a tsunami warning that has been partially lifted on japanese markets are closed for a national holiday but we are watching the yen trading just shy of the 141 level and nikkei futures looking softer at this part and also watching

china futures up 1/10 of 1% and a lot to pass through when it comes to the messaging from president xi jinping that finally balanced acknowledgment of some shortcomings and challenges ahead but also trying to project a picture of domestic strength. yvonne: that is the key question for many investors. will be model along with it comes to the economy -- model -- muddle along when it comes to the economy? asml confirming a partial dutch government ban of some china shipments and we have seen some chipmakers aligning more with the u.s. and what they are trying to do away from china and now we get the confirmation from them of the government ban and

certainly one to watch as we count down to the chip turnaround forecast for the year and how it will play out in terms of geopolitical tensions. let's get to the latest with japan. authorities warned there might be further aftershocks following the powerful 7.2 earthquake that killed at least four and triggered a widespread tsunami warning. the warning has been lifted in some parts of japan. joining us from tokyo is isabel reynolds with the latest. >> the latest we see from nhk is six people are confirmed dead in this earthquake, actually 7.6 magnitude, it is rare to see one of that strength and size. looking at social media and the

broadcast, you see it was an extremely powerful earthquake. some buildings shock and fell over. roads buckled and fell away. it must've been terrifying for those in the area. the rescue process is ongoing. a massive fire broke out in one quaint hometown that had a lot of wooden buildings. more than 50 buildings were involved in the fire and it is still going more than 12 hours later. haidi: we are seeing a lot of impact on local infrastructure. >> trains on the peninsula that sticks out into the japan sea have stopped and other regional trains have been stopped on the local airport is closed because

the runway has >> and -- runway has cracks. it must be affecting rescue attempts. only six debts at this point but sadly i think it is likely that number will rise now that we are getting into daylight and rescuers, including the japan armed forces, will get into the more remote parts of the peninsula. yvonne: this brings back memories of fukushima. what will this mean for the nuclear plants in the area and electricity supply in japan? >> one thermal plant is off-line because of damage. power outages are in the area during this cold time of year.

it could impact the power supply over the coming months. they thought they had enough power for the season and that could affect the calculations and how people in the country get to use electricity. as of now the nuclear authorities say there have been no abnormalities and there is no need to be concerned about a nuclear disaster like fukushima. haidi: isabel reynolds in tokyo with the latest. iran has dispatched a warship to the red sea after the u.s. navy destroyed three who the boats on monday. -- houthi boats on monday. tensions are ratcheting up in the waterway. mike, how do you read into this? >> this happened as a houthi

representative was in iran and in a sense it is iran signaling they will not be intimidated and they will make sure the waterways or their territorial waters are clear but it is a shadow play going on between the u.s. and iran. the biden administration is trying very hard to ensure the conflict does not spread, whether that is in southern lebanon with hezbollah where there is the maritime group trying to dissuade them by the goal is to avoid the ratcheting up. the temptation to strike must be strong because this originates from iran but the biden

administration is trying hard not to do this and iran wants to keep prestige up as well and so it is a lifting of tensions but at this stage is not going to send us any further. yvonne: what about gaza withdrawing troops? >> the description from israel is it will allow soldiers to return to the economy, the is really economy -- israeli economy has taken a hit with reservists out of the workforce so they are arguing that part of this is to normalize in terms of the economy but it signals to me

that the suggestion is that it is part of israel moving to a more targeted campaign. we had the bombing of the gaza strip and large-scale ground forces going through and we still have intensive fighting going on in the southern part of the strip but at this stage it looks like now they are moving to operations where they are trying to eradicate certain leaders or districts but not the full ground force you see state to state wars so it heralds the move to a new phase of the war we are seeing. it is a few 1000 troops is my understanding. yvonne: thank you michael. the israel supreme court has overturned a law into weakening judges powers. eight judges voted to overturn with seven in favor of keeping the law that would have barred them from voting on government

decisions. this was part of a populace overhaul that split the nation with thousands taking to the street to protest. ukraine says it shutdown more than 90 drones on new year's eve following russian missile attacks over the weekend that killed 30 in ukraine. moscow says they will seek revenge for the missile strike on a city that killed at least 24 people. aerial assaults have intensified recently with ground conflict in a stalemate. xi jinping told biden there countries should struggle for a peaceful union. relations have contributed to global peace and stability and ties have studied since they met in san francisco in november. haidi: asml confirming a dutch

government ban on some china shipments and this really takes effect as we watch the key risk going into the year the ongoing tensions between u.s. and china so much as been focused on the text fear and so much further focuses as we get into this key election year with the u.s. presidential election in november. annabelle: you have to understand the significance of how important asml is to the chipmunk in process globally because -- chip making process globally because it produces these machines that can print tiny features that form the basis of a microchip and it is very important when you get into this advanced a semi conductor phase and it is very unique in capabilities in this chip process.

the biden administration wants to limit china's capabilities in producing advanced semi conductors so it has been putting pressure on allies like japan and the netherlands to restrict export of chipmaking equipment to china now these took effect january 1 but what we understand and report on is some countries got a head start on the process so asml had the licenses to ship three of their devices to china and we understand these were canceled so they have not been sent across and so asml has confirmed that needs essentially that the netherlands revoked the chip license partially and the number are impacted by this so asml also saying the license being revoked will not impact the financials but it is still about

saying there was the export restrictions that have taken effect and some countries got ahead of it and how important asml really is to the white house ambitions to try to restrict china's capabilities in this field. yvonne: president she about peaceful coexistence that he says he hopes to have with the u.s. and he acknowledged the geopolitics but in his new year's message the economic challenges china faces now. let's listen. >> on the road ahead, wind and rain are normal. some enterprises are facing operational pressure and some are counting -- encountering difficulties in employing and life and natural disasters have occurred in some places. all of which i am deeply concerned. we are not afraid of hardships.

we will watch out for each other, face up to the challenges and overcome the difficulties. yvonne: he spent time admitting difficulties, which is quite rare for him. annabelle: it is not something we hear much from xi jinping but when you think about the issues china's economy has faced last year it is unsurprising given you had a high unemployment on the market rout in stocks so an element of concession to it but it is important to think about how xi jinping plans to respond to the challenges and that was a focus of his address so a pledge to strengthen in the upon it -- economy and create more jobs and opportunities for young people in china and some grandstanding as you might expect as well so he reflected on some of the

home-grown projects and successes for china over the course of last year like a cruise ship that was locally made, space programs, the developments we saw in china's aviation ambitions because we had the passenger jet making its first trip outside of mainland china. haidi: more to come here on daybreak asia. this is bloomberg. ♪

yvonne: happy new year. we have key data coming out this weekend we are kicking off 2024 with busy days. australia december manufacturing pmi, further contraction from november and signs of disappointments. pmi readings across asia. full year gdp figures out of singapore. ism manufacturing numbers in the u.s. and more employment news for the fed to digest thursday initial jobless claims and the nonfarm payroll coming up friday as well and inflation numbers

out of thailand, taiwan as well, do not forget we have the election in taiwan happening in 10 days or so. [indiscernible] joins us from taipei. alisha, we have to talk about this new year and this time last year the three popular trades were to sell u.s. stocks, by china stocks and by treasuries and it did not play out as planned. will this year be better? >> it was good for some, for those who play differently as you said and i think the play was as we have now everybody is short dollar, we heard that last week so i think the chance is this year that the dollar will

be weaker because the fed will be cut no longer in the labor market which we will check next friday but the key here for the fed to be successful is to really to make sure that real interest rates will become very high and this is the situation in china so the key is not so much how quickly the rates come down, but how quickly inflation comes down at the same time so that you do not have very strong real interest rates that kill the economy. that is what we need to watch. i think that is the key for equity markets, to make sure the economy decelerate slowly but steadily. yvonne: how are you looking at the risks now and is it more symmetrical now, the risk between inflation and the

recession risk and what are some of the potential chokepoints for this year? >> for me, trade. this year the imf has warned us since their last meeting and i think they are right, focusing on trade fragmentation and financial fragmentation but it is also trade [indiscernible] heard from bloomberg on asml and the tech related fragmentation, we also have china trying to integrate vertically as a response also rightly so to the pressure from the rest of the world, whether it is the threat for protectionist measures on chinese electric vehicles, the tax china produces which is at the top of the exports and anything that is a big risk also china for the rest of the world

because china will try to control imports as a response because that is growth for china, certainly what china will rely on for xi jinping to come up with these promises in his speech that china will grow fast in 2024. yvonne: are we seeing positive signs that we are seeing the bottoming out of the export cycle? what will global demand look like? >> taiwan, south korea, those really suffering from the humongous stoppage of products and semi conductors, they will do better because they were so low but that is just one part of trade. if you are selling anything else but it is machinery, chemicals, combustion engine cars, they are

not going to do any better this year so i think except for the ict cycles, 2024 will not be a good year for trade, unfortunately. yvonne: you mentioned the shifts in trade we saw the export numbers come out korea right exporting more goods to the u.s. , more so than china now, the u.s. is now the number one market. is this a sign of shifting trade patterns? is it just geopolitics related? >> i do not think it is only geopolitics. it's a great point. part of that, if you think about the u.s. importing less from china because of ira south korea for example is really benefiting from ira because of exceptions to ev's and the like from korea but it is more than that. i think in a way it is also

consumer preferences that are changing and that is harder to control from china's perspective, it is more structural. there was also regionalization of trade. like climate change related. there is lots of things happening at the same time and i think we need to realize that yes, trade patterns are changing. yvonne: taiwan is caught in the middle of the geopolitics and where you are, we're a few days away from the national election. what would another four years of his rule mean for the economy there? >> the economy and this might be related to the [indiscernible] it was that connecticut really that brought taiwan to grow -- it was the connect that really

brought taiwan to grow, 2023 was instrumental for taiwan. 2024 will be better for taiwan, no matter who wins. it's a cycle. it is similar across the board [indiscernible] yvonne: we have to leave it there but thank you so much, alisha. plenty more to come on daybreak asia. this is bloomberg. ♪

annabelle: you are watching daybreak asia. markets are steady going into the first trading session of

2024. mutated gains across the board but the session looking range bound with markets are shut in japan and new zealand but coming off the back really of weakness we saw in the prior session on wall street so it tells us again that it could be range bound and i want to demonstrate that if you bring up the function check how aussie stocks are trading 30 minutes into the session and you can see that trading activity is 75% lower than where it would be at this point on a typical 20 day moving average basis so a lot of investors probably away for the holiday but it is though the question of how markets will perform over the year and there is expectation that there are strong things moving in favor of market and though valuations are a little stretched in the

session, let's change on it depends on the direction of where the fed goes but as you can see from the chart a lot of fed cuts are priced in over the next 12 months so traders when you look at fed fund futures positioning seeing four cuts of on. yvonne: you can see the cuts priced in today and that will shape the direction of the dollar and garfield reynolds joins us and we continue to see the weaker dollars story, are we likely to see that this is the beginning of the climb of -- decline of the dollar? >> there is a decent chance that is the case. expectations are very strong that the fed will cut and end up cutting earlier than they said they expect to. there is not a huge amount that can get in the way of the expectation in the early running

so that will build the case for a weaker dollar, at least short-term. a lot of it will be driven you would think by japan. we had reports over the weekend of plans for strong wage increases. that is only anecdotal so far and does not necessarily add up to a case for the boj to reduce massive quantitative easing but that case has been building anyway and that will mean the yen is currently trading 149 or just under per dollar, plenty of scope for that to go down to 100 30 as expectations build but the boj is finally going to move towards doing what many have waited years for and reduce the amount of money it is putting in

the japanese economy. that will drive dollar weakness and encourage the general anticipation that the u.s. very much lead the way up when it came ultimately to tightening policy and now it is seen as leading the way towards loosening policy that should bring a weaker dollar up for the first few weeks or months of the year, if not further. haidi: we saw the first treasury gains since 2020. is that fed narrative set going into the new year? >> again, that is part of the same phenomenon that is expected to drive dollar weakness. if yields do not keep moving down, the dollar weakness narrative would lose strength.

when you've got 150 basis points of rate cut priced in the yet -- for the fed and expectations going to move before others do plus the fact that just under three .9% for 10-year treasury yield's, that is pretty appetizing, higher than anybody has had to play with for a long time, especially in an environment where yields are expected to move down so the expectation is going to be further declines in 10 year yields. the big question remains, does the fed engineer a soft landing? if it does, we can expect a more shallow reduction in yields, i think they would still go down but 10 year yields stabilize at 3.5%. soft landing scenario, 1.25.

a hard landing, 3% and then under 3% by the end of the year. haidi: garfield reynolds they are. some tsunami warning still in effect in japan after a massive earthquake. more than 50 aftershocks have been reported and at least six are confirmed dead. firefighters are still battling flames in a city where 50 buildings were caught fire. and they were also hit by a tsunami. the scene you portfolio manager from egp and before we get into broader outlooks for japanese assets we do have markets closed for a national holiday today. do you expect to see much of an

impact from this disaster and how does it potentially play out? >> it is really a terrible event but fortunately the tsunami so far has not been that large. tsunamis caused the greatest destruction so we are hopeful that the worst is behind us. japan tends to be very resilient and well-prepared for these types of disasters so hopefully the impact will not be that large. haidi: when it comes to broader japan markets commit a tepid point for japanese equities right there are a lot of people who believe going into the year a lot of the same things are yet to be fully played out there are opportunities for gains. >> if you look at the japanese market and assume nothing changes, it is very fully

valued. i think the easy by japanese edf and you make money is maybe not over but big returns are done but as your previous guests said there is a lot of upside on the yen, it depends on when the boj moves on the fed moves but i think if you look six or 12 months out you have at least 15% upside from the yen and in the japanese equities market, for stock pickers it is a good market. looking at the most recent earnings season there was massive dispersion in the performance on returns of individual stocks so you could make or lose a lot of money if you got your stop right or wrong so it is a stop pickers market right now.

yvonne: you mentioned that the end is undervalued, if we are talking 15% upside there what does it mean for earnings then? >> that's a great question. i think it is, it is not going to be as bad for earnings as it used to be because a lot of japanese manufacturing is done much closer to the ends market, in u.s. or southeast asia or europe. but there will still be a translation impact and so i think it will be a significant headwinds for exporters. however, it will play positively for domestic japanese companies and staples and foods on those sorts of areas, furniture companies who import goods from overseas so i think it will be a nice tailwind for them. yvonne: there has been a massive route i am wondering how are you

assessing the portfolio, what looks overdone to you, what is still a buy right now? >> two things are overdone in the japanese market. because of the tokyo stock exchange talking about low price companies and naming and shaming , i think a lot of the companies have run up to much, a lot of them do not have a good business model and an example is regional banks in japan. i even with interest rates going up a net margin spreads are so thin, there really is not significant loan demand in japan, 60 percent of japanese companies are cash rich and houses are cash rich. they cannot earn a decent return by lending money. so that is overdone. also the inbound team.

one of the things that is an issue for inbound, even though it has not really gone much beyond what it was in 2019, but the problem is a labor shortage and a capacity issue. so unless japan solves that sort of labor issue, the inbound team is at peak inbound. there is little capacity to add a lot more tourists into japan. haidi: what would you be shorting? >> there are three groups of companies we like to short right now. the first is companies with weak balance sheets. an example is japanese risk strong's, who suffered a lot during covid and they have over divert balance sheets and they run on the inbound reopening theme, valuations are very high and i think most of the cash

flow will go to repaying debt and there is a significant risk of very diluted of equity issuance by them. so that is one thing that i think is a good thing to short right now. second is the companies without a business model, things like regional banks as i mentioned earlier. the third is bad governance in general. with the market up 25%, there are a lot of companies in japan, about 35%, that still have poor governance practices. they do many things that are not in the interest of shareholders and they have run up the market and it is a good time to short them. yvonne: we are going to leave it there but thank you so much for joining us and helping us kick off 2024 and a look at japan and we have more on our blog on bloomberg at mliv and our team is back from the holiday and

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so warehouse and customer data stay protected every step of the way. make amazing happen. cisco and cdw. haidi: last year saw a record deployments of renewables and ev's around the world and in

dubai, a historic deal to move away from fossil fuels. our guest looks at what this year has in store. how are your expectations going into the year? >> we expect growth to continue this year. with solar, 2023 was record. we had to revise up the forecast a few times because of significant growth in china. this year, we expect global installation will exceed 500 gigawatts. we estimate globally the number was 400 13 gigawatts, significant growth and china remains the biggest market that this year we expect the growth rate to be higher in the rest of asia.

wind has had a lot of challenges since the pandemic but still had healthy growth last year so we estimate last year 103 gigawatts , 70% growth year on year. this year, 115 gigawatts expected. china remaining the largest market although we see significant activity elsewhere. electric vehicle growth, still healthy. annual cells we estimate exceed 14 million units globally, to percent lower than the original forecast on this year we expect the sales to exceed 16.7 million and china will be the largest with sales that might reach close to 10 million this year and the rest of apac japan healthy growth, first year rates

where ev sales will exceed 200,000 units. yvonne: what about clean hydrogen production and carbon capture and storage? are we seeing improvement in these technologies? >> there has been a lot of talk but now we are seeing more action. for clean hydrogen production to put the numbers in context, in 2022 retract shipments of .9 gigawatts. this year we may see shipments reach as high as five gigawatts. that growth is spreading across the world. china used to be the largest and they will still be the single largest market but we see growth across the world and in other parts of asia we expect activity in south asia and india and japan and korea.

carbon capture storage is more difficult. most actions still in north america where there are generous incentives and play. here in apac they want to watch japan or they are expected to release regulations around storage as part of their world map this year. haidi: a massive election year. what are you watching in terms of key events? >> elections will be critical for energy transition, even solar and wind and ev are becoming more competitive in many market but the pace of deployment and investment in scaling up new technologies will require policy and the first one to watch will be the taiwan elections january 13. if the opposition wins we might see a shift on the current government antinuclear stance.

the next is the general election in indonesia february 14. if the former jakarta governor wins, he is the most progressive and will likely see an acceleration toward energy transition but if one traditional candidate wins we will probably see the continued challenge in that market. there are several other elections. india in mid april. south korea in april. they are unlikely to have a significant impact in terms of energy policy but the one that globally will be article is the u.s. elections november 5. if trump wins, we might have

challenges with the u.s. shifting away from climate diplomacy. again. yvonne: plenty at stake. thank you for highlighting that for us. plenty more to come on daybreak asia. this is bluebird. ♪

yvonne: you are watching

daybreak australia. saudi arabia's public investment fund was the world's most active sovereign investor last year as singapore/spending. the pif deployed more than $31 billion in 2023. a decline was led by the gic that invested 46% less. byd sold over 500 26 thousand fully electric vehicles in the fourth quarter or so tesla will need a record showing to continue number way -- number one status. byd sold more than 3 million in total electric and hybrid vehicles last year. haidi: carnival ceo jeff weinstein says the cruise operator is two thirds booked for 2024 and that demand is

coming from shifting priorities rather than just post-pandemic revenge tourism. >> 2023 we wrapped in november on the 30th and the one word we like to use is record, we had record demand, record yields, record pricing, record bookings, record on board to spending levels so really across the board the business has really thrived in 2023 and we expect much more in 2024. >> you are such a great gauge of how customers are feeling. are they continuing to spend? >> that is what we see. our q4 from pricing standpoint was the highest all year so it is accelerating, not decelerating and when we look forward, we are two thirds booked for 2024 already. not bad. we are 10 points higher than

where we were last year and on top of the ticket bookings, we have started pulling forward on board spend so we have about one third of the onboard spending prepaid in advance so we have a really good about of visibility and the booking trends have not slowed down. every quarter this year, people expect that it will slow down, it has to, we are going to see something, the consumer will be impacted and the fact is with our business, we have not seen it. it is record after record. we just ended the two weeks of cyber monday and black friday at more records and it is not just coming from one brand, it is not just from the united states, it is with the global portfolio of brands which is encouraging. >> do you think we are moving from many ceos like yourself

where they have said we have lived through the revenge tourism and we were locked up and now we have this parabolic reopening. are we evolving into a new cycle? you said there is no end in the demand so if this is not revenge tourism, how do you describe this next evolution? >> this is not revenge anymore, it is not pent up demand. it is two years later from when we got back. this is people who have decide what is meaningful for them, how do i want to spend my life, and experiences are what they are looking for. unforgettable memories created with friends and family and that is what cruising has to offer. >> another ceo says he does not have enough hotel room. yvonne: let's look at how we are tracking in the early part of trading. haidi: quiet. volumes on the ground when it comes to trading in sydney and

january is quiet but we have japanese markets closed for holiday and to sydney stocks advancing one quarter of 1%, 2/10 of 1% i should say in new zealand we are not seeing the market do much of anything, this is stuck at just a marginal gain pretty much all morning session and a bit of a muted downside, taking into account the aftereffects of the earthquake and the tsunami warning in japan, some of which is still in place in parts of japan. market open in seoul is next. this is bloomberg. ♪

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>> this is "daybreak: asia," counting down to asia's

major market open. happy new year. the first trading day of 2024 be a good -- the first of 2024. the key question is about the broad-based rally, may be with the exclusion of china. is there still that much cheer as we are starting a new year now? haidi: i'm still somewhere around christmas, to be honest. [laughter] still catching up to 2024. not a great deal of cheer for china. all that change and that stimulus effect, finally starting to gain some traction. we saw a fairly nuanced, balanced view from president xi jinping and his televised address acknowledging the shortfalls and challenges going forward. we know for the global economy, the geopolitical space as well, it is a big year, filled with elections. kicking off with taiwan in the coming weeks, all the way through to november where we

have the u.s. presidential election. all this happening in a crucial time for the central banks. have i missed anything? [laughter] let's get straight to the market open. it's very holiday themed in terms of the volumes. japan, on a public holiday. we are watching developments when it comes to the new year's day earthquake and the tsunami warnings. some of that, still taking effect across a large -- across large parts of japan. when it comes to trading in south korea at the moment, the kospi, just coming online. upside of 1.6% at the start of trading. we are also watching the impact when it comes to the weakness in volatility that we saw in the dollar, whether that will potentially play into a bit of a better year for asian currencies, which we saw asia's other currencies going into a third straight year of declines. this is the picture as we see the open of trading in korea. we are also watching singapore assets today. we had an indication of what to expect from the full year

number, avoiding a recession in 2023 for the economy. warning of a troubled international environment though that will it -- that will weigh on securities -- on insecurities. we are getting the quarter on quarter fourth-quarter number for the gdp number, 1.7%. that is better than expectations of 0.7%. a bit of a strengthening from the 1.4% gdp number year on year. 2.8%. a bit of a beat on expectations but of course, a lot of external vulnerabilities there. >> we are taking a look at australia markets as well. the asx, pretty slow going. we are seeing gains of a third of 1%. when it comes to stocks, a bid appeared today. for australia, getting close to the 4% level right now. we heading for the one-week high when it comes to some of these

real yields in australia, something to keep in mind. the aussie dollar is flat. crude is pretty much flat. only up about .5%. it is slow going, tepid to start the week. you talked about japan, the markets are closed. certainly that is leading to volumes being quite low here, haidi. haidi: let's bring in mark matthews, head of asia research. going into the start of this year, it's been much ado about valuations particularly when it comes of these exceptional markets like the u.s., where we are seeing levels pretty high but you have been crunching the numbers and potentially you see more value to come? >> yes, i think so, haidi, the earnings bottomed the third quarter of last year and in the fourth quarter they grew, i'm sure. looking forward, we are looking for about 10% earnings growth in the s&p both this year and next

year. that would put the s&p on around 17 times by the end of next year. that's not an expense of multiple. -- expensive-- multiple. haidi: we will have more to fill out the picture when it comes to geopolitics and the political risk globally with so many elections. is that a theme you are paying attention to? >> most certainly. the biggest one of course is the election in the united states. that is a geopolitical risk for sure. right now if you go by the polls and betting websites, it looks like it's going to be trump 2.0. i would simply say as much as that could cause a lot of -- what's the word? -- chaos in politics, if you think back to trump 1.0, it was good for the stock market. the first three years he was in office, the market returned 35%. it was not until covid came

along that things got rocky for the stock market. and so, yes, there's lots of geopolitical noise, but i think overwriting that is the fact that the economy will still grow, inflation has come down and so too will interest rates. >> fed cuts have been a dominant narrative this year potentially, mark, what does it mean for u.s. stocks in particular? lower rates are good for evaluation -- for valuations. what if there is a recession in 12 months or so? will the economy remain strong? can earnings expectations hold? >> it really depends on what kind of recession. there are big ones and little ones. a big one like 2008, all bets are off, the market will go down no matter how much the fed cuts. but i can remember -- i'm embarrassed to say -- the recession in the early 1990's. 1991, 1992, actually, the market

was fine if you take it on a two-year view. it was up about 25% despite the fact there was a mild recession in 1992. so, anyway, yes, well, let me just say that if you look at the major economic indicators and compare them to what they did after a yield curve inversion in previous episodes, the economy today is incredibly strong, relative to those previous times. i do think it's going to soften because of these high interest rates. but as they come down, we should get the economy growing faster again this year. -- again the second half of this year. yvonne: you are still quite bullish on the u.s., is it just the magnificent 7? is this ai rally -- how is it going to play out for 2024 now? our other parts of the market going to catch up? >> we like health care.

specifically the obesity drugs. they've done very well. no doubt about it. biotechnology has done very badly but should benefit from lower rates. but i have to confess the thing that we still like is the big technology stocks. the reason for that is simply that their revenue and earnings growth will be significantly above the other stocks for the next couple of years. and usually stocks outperform when their earnings are rising faster than the broader market. haidi: i've got to ask about china of course. on the other end of the spectrum in terms of the doldrums we have seen. we have sort of compiled what private economists are expecting from the chinese economy in 2024. sort of a modeling through year. -- muddling through year. do you see more of the same and no big policy measures or structural changes?

or is it a fork in the road? what policy choices do they have at this point for the outlook to materially improve? >> haidi, i think it's going to be another tough year for the chinese economy because president xi has made it clear that, on the economic front, his priority is bringing down the size of the property sector and its importance on the economy and it is too important -- he is right about that. there is too much excess inventory and that process is painful. if it became such a big deal that it has the possibility of creating a systemic risk, i'm sure they would step back. but i'm not really thinking is going to be a great year and growth rise may be 4%, 5%. let me just throw in that from a stock market perspective, hong kong has an extremely clear link to the fed funds rate, because of the hong kong dollar peg. so irrespective of what the

chinese economy does, i think that possibly the best market in the first half of this year is going to be hong kong, as the fed cuts rates. yvonne: all right. we will see how the property stocks do. thank you so much for joining us. mark matthews. head of asia research at julius baer. authorities in japan are warning there may be further aftershocks following monday's powerful earthquake. the 7.6 click on the northwest coast killed at least six people and triggered a widespread tsunami warning. joining us from tokyo is bloomberg's visible rental -- bloomberg's isabel reynolds. what's the latest? reporter: there have been six reported deaths on the northwest coast of japan. fortunately this area is relatively little populated. which has contributed to a small number of casualties so far. however obviously roads

have been damaged. transport links are very much damaged by this earthquake. it's very possible the number of casualties could rise in the future, going forward during the day. also we have seen several dozens of people taken to hospital. we are hearing that water supplies have been cut off in some areas which is making treatment difficult, and about 40,000 households have been cut off from electricity. haidi: the significant impact on infrastructure -- haidi: a significant impact on infrastructure. reporter: yes. we are seeing the roads are blocked. if you look on television and social media, the extent of the damage to the roads seems to be enormous. it is a picturesque and touristy area. we have seen this huge fire in the city because these areas have a lot of old wooden buildings which can catch fire quite easily. as of this morning, the

firefighters were so trying to tackle that blaze which had spread across more than 50 buildings in this well-known fishing market area that tourists like to frequent. yvonne: tell us about -- there are some nuclear plants in that area. tell us more about them and is there a risk to the electricity supply more generally in japan? reporter: you are correct, there are two nuclear plants in this area. in the area we have the largest plant in japan. this is a key one for japan's energy policy going forward and its climate change policy. japan very much wanted to restart this plant. but with this huge quake -- although there hasn't been significant damage to either of the plans as we know at this moment, it will cast fresh doubts over whether restarting

them is a good idea. yvonne: visible reynolds there in tokyo. much more to come here on "bloomberg daybreak: asia." this is bloomberg. ♪ the first time you made a sale online with godaddy was also the first time you heard of a town named dinosaur, colorado. we just got an order from dinosaur, colorado. start an easy to build, powerful website for free with a partner that always puts you first. start for free at godaddy.com

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haidi: we are watching korean chipmakers this morning. they are revealing new steps from the u.s. to limit beijing's ambitions across the key tech sector. asml has now confirmed it canceled shipments of some of its machines to china and we will be following these developments. we were talking about how the start of the new year, we are seeing these policy measures continue to take effect. >> that's right. they put these restrictions on

manufacturing equipment on china that took effect january 1, also involving its key allies in the process, the netherlands and japan. what we are understanding is certain companies got ahead of the restrictions, taking effect, and the one in focus this morning is asml. it is important to understand how significant asml is on a global scale to semi conductors. they produce extreme ultraviolet lithography machines. there's a lot of details in that. an euv lithography machine has the capability to print to tiny features that go on to microchips. asml has a complete monopoly over this market on an international scale. so it is extremely vital to the chipmaking process overall. as i said, we know the u.s. wants to limit china's advancements in producing semi conductors. we saw the effects of that at the end of last year because huawei put out a smart phone

with a seven nanometer chip that was seen as a bit of a breakthrough but they importantly had reduced -- had produced that chip with the aid of asml's machines. asml had in place three licenses to export three of its ultraviolet lithography machines to china by january. those shipments have not actually going to head. they were canceled -- gone ahead. they were canceled on the behest of the dutch government. the biden administration was pivotal in pushing for the dutch government ban. asml confirmed the bloomberg scope that came out over the weekend is significant to watch in terms of just how seriously the u.s. is taking china's capabilities in this field. yvonne: it's interesting, xi, telling joe biden he hopes into two nations can coexist peacefully but there you see the tensions between corporates now. we heard from president xi in his new year's address addressing some of these

economic challenges. let's take a listen. >> on the road ahead, wind and rain are normal. some enterprises are facing operational pressure and some people are counting difficulties in employment and life. a natural disasters such as floods, typhoons and earthquakes have occurred in some places. all of which i am deeply concerned. we are not afraid of hardships. we will watch out for each other. face up to the challenges and overcome the difficulties. yvonne: he spent some time talking about the tough times, that is a certainly a rare admission for the president. >> yeah, that's right. we don't really hear this too much from xi. but of course it's hard to ignore the backdrop we had in china over the course of last year as well because there was the property sector slump,

issues with unemployment, the high youth unemployment in particular with those figures are the midpoint of last year, the market rout -- you do have that element of concession coming through. but it's equally important to consider just how xi plans to respond to the challenges and that was another focus of the address that came through. there was a pledge to strengthen the economy and create more jobs. to provide better opportunities for young people. just a little bit of grandstanding on the progress that china has made in terms of its homegrown projects. we spoke about the chip sector, if you want to watch. other things, he mentioned as well, locally made cruiseships, space programs, passenger jets, some achievements that were touted as well. haidi: on the flipside, the economic weaknesses persist. >> that's right. over the weekend we had the pmi data that came out on sunday. it really showed the persistent challenges coming through. factory activity, big

contraction there. shrinking to its lowest level in about six months. you can see in this chart here you've got the manufacturing side coming in at 49. economists had seen a reading of 49.6. we've got been on manufacturing side as well. better numbers coming through there. but really wanting to more of the fiscal support let's come through -- that's come through, not a pickup and genuine activity. services as well. still in contractionary territory. below the 50 reading. what economists are saying out of this is a puts more pressure now on policymakers, some including anz and the bloomberg intelligence team are starting to say that we could see rate cuts as early as january. so this month. yvonne: thanks so much. we are still waiting for the numbers out of china. the president also told his u.s. counterpart that the country should strive for a peaceful coexistence in a new year's day letter commemorating diplomatic ties, noting he

was-china relations have contributed to global peace and stability. ties between both countries have studied since xi and biden met in san francisco last november. ukraine says that shut down almost 90 russian drones on new year's eve as the war grants towards her third year. russian missile attacks over the weekend killed at least 30 people in ukraine. moscow had said it would seek revenge for a missile strike on a murder city that killed at least 24 people. a series of tit-for-tat aerial assaults has intensified recently, with the ground conflict in a stalemate. meanwhile israel's supreme court has overturned a law aimed at weakening judges' powers in a blow to prime minister gemma netanyahu -- benjamin netanyahu. eight judges voted to overturn with seven in favor of keeping a law which would've barred them from voiding government decisions. the overhaul split the nation with thousands taking to the streets to protest the planned changes.

haidi: iran has dispatched a warship to the red sea after the u.s. navy destroyed three houthi boats on sunday. the move could be seen as a challenge for the u.s.-led maritime forces to have attacks in the area and ratcheting up tensions in the water with handles 12% of global commerce. michael heath joins us now. does this seem to you like an escalation of the risks in the area? >> it can't not be, haidi. iran and the u.s. have been opposed for more than four decades. you've got u.s. warships there. also some of their allies, trying to protect shipping from the who the rebels -- the houthi rebels. it just has a -- accidents can happen in these tense situations.

so it does increase tensions. whether things go any further, i think it is highly unlikely. the u.s. and iran have been conducting almost a shadow play over the course of this entire conflict between israel and hamas in gaza. everyone understands who is backing who. iran provides financing support for hamas and hezbollah in southern lebanon. for the houthis which have been shooting at the ships as well. the u.s. side does not want to see this escalate. it can support israel. israel can conduct its operations. once it spins out of control, no one knows what will happen there. yvonne: in gaza, we are hearing israel is pulling troops out of the area, is this a new phase in the war, michael? >> it seems so. the reporting is basically

saying that israel's very keen to do this because it wants to support its economy which has been hit very hard obviously, by withdrawing 300,000 reservists that were called up. that draws a lot of labor from the economy. outside of the cost of war, that has hit the economy as well. it supports that. in terms of the war, it does suggest the beginnings of a change. only a few thousand troops that we are talking about. but what it suggests is we are moving to a more targeted approach, of more position strikes. that's difficult to actually undertake in war. the difference between that widescale, large-scale ground campaign we have been seen that's created a lot of civilian casualties, to a more targeted approach which the u.s. has been pushing israel to adopt. haidi: in terms of the international reaction we saw the last few days, africa bringing the case before the international court of justice in addition to of course the

ongoing investigations at the icc as well, this is not going to impact the outcome of the war, but what does that tell you? >> you are right. it's looking like the u.n. in a way. it's a symbolic sort of issue. it is an interesting one. the court could rule that this does constitute genocide. genocide's difficult to actually define because it requires intent and all these sorts of issues. but it is very worrying, for israel, in terms of the international opinion. they said it hailed back to the middle ages. the history between israel and south africa is fascinated. israel was allied to the apartheid regime. the anc, with the plo, the palestinian liberation authority. it does not help israel's public election campaign internationally. haidi: lumbar's michael heath --

haidi: bloomberg's michael heath here in sydney. much more to on "bloomberg daybreak: asia." this is bloomberg. ♪

yvonne: you are watching "bloomberg daybreak: asia." saudi arabia's public investment fund was the world's most active sovereign investor last year, as singapore's gic slashed spending. it shows the pif deployed more than $31 billion in 2023. state own funds invested $125 billion last year. that's down if it from the previous 12 months. the decline was led by the gic which invested 46% less. chinese automaker byd sold over 526,000 fully electric vehicles in the fourth quarter. that means tesla, with a record

showing -- will need a record showing to maintain its number one status. in total, byd sold more than 3 million electric and hybrid vehicles in 2023, almost as many as the previous five years combined. the u.s. is cutting the number of electric vehicle models eligible for a $7,500 consumer tax credit, as new rules taken from january. the narrower criteria have slashed the number of models to 13 from about 24. the new rules exclude ev's that use battery components made by chinese manufacturers. we've got plenty more to come on c'mon, we're right there. c'mon baby. it's the only we need. go, go, go, go! ah! touchdown baby! -touchdown! are your neighbors watching the same game? yeah, my 5g home internet delays the game a bit. but you get used to it. try these. they're noise cancelling earmuffs. i stole them from an airport. it's always something with you, man. great! solid! -greek salad? exactly! don't delay the game with t-mobile 5g home internet.

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and our success stories are real. why not give it a try? haidi: take a look at the state of play when it comes to trading around the region. japanese markets are still on holiday today. pretty thin volumes and interests here in australia.

we are looking pretty flat at the moment. .4%. we are seeing strength in energy and oil stocks. energy up by 1%. that is the outperformer of the day. crude prices, advancing. the rn worship, and to bring -- iran war ship, entering the red sea, creating concern over the risk in energy markets. the 11% decline was the first annual drop since 2020. the kospi, up by 1.6% at the moment. the outperformer in the region. not much when it comes to trading direction out of new zealand either. yvonne: we are taking a look at pmi's breaking across asia. good news when it comes to december. indonesia and vietnam, i would say, showing some improvement here. 52.2 for indonesia pmi,

well into expansion there and improving. vietnam, 48.9, improving, but still and contraction. what has disappointed -- in contraction. what has disappointed is malaysia, the philippines, taiwan, seen signs of slowing when it comes to manufacturing. the philippines, 51.5, that is still expansionary, but the rest are seeing further contraction as well. of course, this, on the backdrop of the china pmi numbers which disappointed in december. you've got to wonder what investors are thinking for 2024. whether it is now time to call time on this route in chinese assets and by this -- buy this dip. >> is the big question. we have seen so much speculation. every time investors piled in over the course of 2023,

they were disappointed i got. the question into '24 is how much malaise, how much has the issue been priced and at this stage? -- priced in at this stage? in terms of allocation priorities over the coming 12 months, you can see the results, under a third are expecting to increase exposure to chinese equities. when they are so low, the room is only to grow at this point in time but it still points to a sense perhaps that investors could look to come back to mainland equities especially when you consider prior readings for instance -- when we ran the survey back in august, a similar survey -- 19% were saying they would look to increase their exposure. the risks of investing in chinese equities does come with some risk. we asked survey respondents

about this. half of them are saying real estate really does remain the elephant in the room, the biggest question mark hanging over china's economy. investment that -- debt, but he challenges facing -- the key challenges facing the economy. here is what investors had to say. >> we don't have direct exposure to china. our preference is to find global conglomerates with exposure to china rather than investing directly into the chinese equity market. >> based on what we see, our allocation is likely to go higher. it was higher this year than it was last year. that will be the case next year as well. china is a good market for relative outperformance and a but market for absolute performance. we think it will continue to be that way. >> we expect more reserve rate cuts next year and more policy using but not bazooka style stimulus. right now china's equity market

is price for a slowdown, growth below 5%. expectations are low and positioning is low. we would be gradual buyers as the market bottoms into next year. >> china's got some good ideas but the visibility is missing. as a result, investors don't want to stay or commit to china on a longer-term basis. preferring shorter term trades. tactical trades. yvonne: let's ask that question to our chief asian economist at anz. the pmi numbers were a disappointment once again. i'm wondering, has the economy bottomed? can china achieve some sort of soft landing this year? >> it's a very disappointing pmi number. i don't think that a lot of people expected the drop of pmi in december. we are looking at a gdp growth

below the target of 5%. may 4 .2% -- maybe 4.2% in 2024. it's hard to characterize this type of chinese slowdown. it was in a very controlled manner. the government was trying to support the growth momentum and cyclical policy. we don't see a freefall of the chinese economy but at the same time we have to expect that the chinese economy is not going to grow back to the 5% error. maybe 4.2% this year. we see this as a gradual slow down in terms of the chinese economy. at the same time i believe it is time to find more

structural reform and nurture some growth. so activity will be improving. i believe that will be the framework that will support this type of control. descending over the soft landing to some extent. yvonne: how are you gauging how this economy is going to play out? seems like things are going to muddle through, right? if you were talking about 4% or so growth. is there anything they will do to reinvigorate the private sector in any way? >> yeah. i think at the same time, the chinese policymakers are trying to support some sort of growth momentum through a more proactive fiscal policy. even with this budget deficit of 3%, of gdp.

if they see the momentum drop too fast, they will issue more local government bonds to support the infrastructure project. even at the central government level, they started to have bond issuing, to support some special projects as well. this is how they want to support around 5% growth. they don't have to be very precise. the growth number to us is not the primary concern right now. it is more the deflation story that is a major concern. you look at the pmi number, but we also look at the price indexes of those pmi surveys. they've dropped below 5% -- for the third consecutive month as well. i think the major concern facing the chinese economy is the downward price pressure.

that is the priority the government needs to address immediately. so we don't rule out the imminent interest rate cuts as well. 20 basis point cuts. the first cuts could be as soon as this month or next month. yvonne: -- haidi: is china in your view already defend that deflationary demand down spiral? what are the risks policy support is not big enough to be able to dra the -- drag the private sector businesses out of that slump? >> that is the key concern right now. the private sector confidence and the household confidence. you look at the property market, we have seen no signs of recovering. we do not expect in 2024 a major recovery of the property market. we might see 1-2 months of

stabilization. but more so it is a structural concern. how households are looking at the future. if real estate is an investment. if this is a good way to store household wealth. that is a major structural issue. if they don't change the policy toward housing, it will be hard to see a major rebound in the housing market. they are trying to ensure some completion in cash flow development. trying to rescue the financial capacity and the cash flow. but if it is still difficult to see how they are going to change the expectations of the future demand.

yvonne: would direct payments help at this point? >> direct payments can give supports -- give support to consumption and support the e-platforms. maybe small ticket items, in terms of household spending. we will still be growing at single-digit, not double-digit growth. it is hard to see how it will have a meaningful impact on household spending at the time. at the moment, i think the governments will only be trying to ensure the prices will not be dropping too fast.

in the consumer market, they may also encourage a seller not to cut prices. in housing and property market, they want to secure the price levels. so there is no stress sale scenario. if they see the prices dropping to fast, it will impact the system, the financial system as well. this cash handout will not have a major significant impact or turn the economic outlook in the near term. yvonne: no easy options. really great to have you with us. happy new year. our chief greater china economist at anz. plenty more to come here on daybreak: asia --

"daybreak asia." this is bloomberg. ♪

>> the reunification of china is a historical inevitability. the compatriots of both sides of the taiwan strait should join hands and share the great glory of national rejuvenation. our goal is grand and simple. >> we hope that both sides of

the taiwan strait can return to healthy and constructive exchanges. we will not provoke or submit. but we will earn the international community's trust and deepen our corporation -- our cooperation with democratic partners so that we can confidently end calmly face the world and china. yvonne: the presidents of china and taiwan, giving their new your messages. xi jinping as you heard, reiterating reunification is inevitable, while taiwan's president, calling for peace in the region. taiwan, heading to the polls in under two weeks the pickets next president. let's bring in our taipei bureau chief with the latest. it's interesting what we heard from xi jinping talking about how reunification with taiwan is inevitable. this seems to be stronger language that we have heard from -- than we have heard from xi in the past. how do you read it? reporter:, good morning yvonne,

-- reporter: good morning, yvonne, in the address that she delivered monday, she will step down after two years of terms, in her remarks, she said the final decision on what kind of relationship taiwan should form with china in the future should be decided based on the common will of the 23 million taiwanese people, and that should be decided in a democratic way. she also said during her new year's remarks that she hopes both sides of the taiwan strait can return to healthy and constructive exchanges. she said taiwan will continue to deepen cooperation with democratic allies in the world, to face china and the world china -- china and the world calmly and confidently.

she said business opportunities should not be used as a political threat. she said it is important for time want have communication with china but it would be too much a price to pay if that means that time one has to exchange its sovereignty for such communication. haidi: we are just about over 10 days out, until the taiwanese heads of the polls. house the race shaping up? -- the taiwanese head to the polls. how's the race shaping up? reporter: it is the next president and legislature january 13. this is going to be an election that policymakers in washington will monitor very closely because taiwan is the biggest flashpoint in the u.s.-china relations. this is basically a three way race. the election is essentially about two competing roads. the ruling party's candidate

said taiwan should not go back to the old past of relying on china economically. the only way on the right way for taiwan going forward is to move closer to the world, and that will reduce risk. but the opposition candidate, they are calling for closer ties with china and criticizing the previous comments, saying they might trigger a war across the taiwan strait. they believe that only by deterrence and dialogue they can de-escalate attention across the taiwan strait. but so far this is the final day we can mention in terms of polls so far. there is no insurmountable victory over his rivals. there is less than two weeks ago until the elections. anything could happen. but if dpp wins the election

again, it's going to be a record third term and they will send a strong message to a world that taiwan will decide to move away from china, and so, china's following reaction will be worth watching. yvonne: yep, 11 days ago. we are going to be very busy during that time. we will get more on the election on special reports and expose have interviews with all three presidential candidates. catch at on bloomberg tv every thursday and asia and wednesday's in the u.s. it is also available in youtube. stephen engle and i will be there next week. this is bloomberg. ♪ i made that. with your very own online store. i sold that. and you can manage it all in one place. i built this. and it was easy, with a partner that puts you first. godaddy.

>> we will just have a rebalancing in the continent. the numbers are not that big. it's been the 200 level. if you think about 15,000 people, that is sort of not that material. i do think both will be simply continuing to grow and be very relevant. what will change, though, the big thing that's changing is the risk-taking that's going to move. we have historically had risk-taking in the u.k. that risk-taking and the assets that go with it, not the people alone but the assets that go with it, that is the next phase of what we are now moving into. and that will be a material change. ♪

haidi: this is the time of the year when we start taking a look at 2024 expectations. i think you said it the last couple of hours -- a lot of the 2023 expectations really never materialized, and things turned out very differently, the the calls on the fed, the u.s. economy, treasuries, the great rebound in the chinese economy post reopening that never quite managed to take hold. these are sort of the expectations, what wall street is lining up for 2024. of course, time will tell,

as to whether they will prove to be right. but let's take a look at some of them in terms of what we are actually expecting. yvonne: china's the big one. haidi: yeah. we have been talking about this idea the economy keeps muddling along. jeffries does not see a big bazooka that investors are hoping for. a new normal of lower but potentially higher quality growth. there are more green shoots of optimism, if you take a look at the other investment houses. yvonne: yeah. a little bit. you talk about at least the fed picture looking a bit better, stimulus gaining traction in china, may be we see signs of stability -- maybe with a sense of stability and maybe the pessimism and positioning has been to -- too excessive.

you've got to wonder, how do you look at japan after this massive rally? it was the best one we have seen in a decade. we are at 1990 highs right now. you have deutsche bank moving to underweight now. there are questions on what are going to be the catalysts to see further gains moving forward. hsbc, still quite bullish. positive opportunities when it comes to japanese banks according to fulcrum. the boj, still very much that wildcard. haidi: the boj is the wildcard. and some of those expectations are exiting icc negative rates from the fourth quarter, pimco seeing under which policy could tighten quite notably, that is one of the big risk factors. we are also hearing from the japanese prime minister, speaking to reporters, talking about the new year's day earthquake, the ensuing tsunami and tsunami warning that is still in place for parts of japan. speaking to reporters, saying they have set up a local task force for the earthquake.

we are here in confirmation from nhk the earthquake has killed eight people and japan -- in japan. there's a lot of disruption ongoing. one of the big calls, one of the big uncertainties is where the greenback is headed. for more weakness this year? markets are expecting the fed to start cutting rates. let's ask our bloomberg mlive strategist. mary nicola. it does look like a lot of structural challenges to come. >> absolutely. it looks like the outlook for the dollar looks like there is more weakness to come. if we look at the key factors the fed is looking at, for example, inflation, we had the pce numbers for november and inflation showing that the six- month annualized basis is making progress. and key factor that we were looking at in terms of what the trajectory of the dollar looks

like has to do with where real rates are. let's say it takes -- let's say you take central bank and adjusted for inflation. actually, real rates in the u.s. are the highest among its peers, the ecb, the bank of england, and the bank of japan. this actually offers the fed greater flexibility to start cutting rates. especially if it wants to ensure some sort of soft landing or no landing scenario. it would be better for them to start cutting rates early, proactively, and especially if they have seen some progress on their inflation mandate. yvonne: the last few months have been quite interesting, with all this broad-based euphoria. people taking on so much risk. is that likely to carry over into 2024, that optimism, and how sustainable will it be? >> we think so. there is not much standing in the way right now. let's say you take projections

and economist forecasts for the non-foreign payroll on friday or for ism, you are expected to see some sort of softening in the data. all of that is going to feed into that dovish fed narrative. and of course once the fed to start cutting, the market is going to just be very exuberant that the fed will not stop. and that is what brings the dollar further lower. >> our mlive strategist, mary nicola, looking at the trajectory for the greenback going into 2024. that is it for bloomberg "bloomberg daybreak: asia." our markets coverage continues, next. this is bloomberg. ♪

david: it's 9:00 in shanghai, welcome