>> welcome to daybreak asia.

>> australia has come online, the top story this hour, asian stocks set for a positive open up a big tech rally sent wall street higher as investors are waiting for key investment earnings. boeing, the most under 15 months after the grounding, inspections have found more loose door bolts. samsung set to release preliminary fourth-quarter earnings of analysts expecting signs of recovery and electronics demand. haidi: we are getting the start of what is going to be a pretty data heavy week. we look at inflation in particular, out of the u.s. and in asia. we do have the south korea numbers crossing the bloomberg for november and this is the picture that we see, the narrowing to just of over $4 billion for the fair plus, good

trade surplus widening to just over $7 billion as well. the current account data showing us the total current accounts coming in at $6.8 billion last year, due november deficit was 222.8 one million, goods trade surplus are over $7 billion, five point 3 billion surplus for the month of october when it comes to services, we are seeing the 2.13 billion in november for the surplus again widening from 1.2 5 billion, the deficit that is in october. and of course this feeds into what is going to be a pretty data heavy day as we get into the tokyo cpi reading which we are expecting later on this morning as well and how that starts to be into some of those 2024 central banks -- central-bank expectations. this kicks off the action in asia. let us get you straight to the market open in sydney, the

staggered open suggesting we see the climb to a bit of an early rally, a quarter of 1% higher, indicating the upside of over 1% at the start of the cash trading session, we are watching the aussie dollar, running into resistance given the big rally of almost 10% since late october of last year. any kind of correction is seeing a bit of a recite for the aussie given we have seen the dollar rally easing, following along with the slide in oil and the price cut weighing on treasury yields and lifting the u.s. shares as well and we saw the yen are performance as part of the effects action. china would be a major factor as we look at what some of the potential outperformers in australia will be at a look to the china sensitive proxies and the other services related names given that we do have the reporting that potentially the pboc, the chinese policymakers are hinting for a rrr cut on the

books this last year, this came in july and that came through later on in the year as well. but he strong signaling that there are more policy support to try to stir lending in china, taking a look at some increased gains in new zealand, kiwi stocks up by half a percent. we see chicago and nikkei futures looking pretty flat but we are potentially seeing a bit more upside when it comes to the open in hong kong. annabelle: we got u.s. futures coming online and fairly steady at the start but a pretty robust session. it was led by the gains in the video, that is the last two are seeing for the stock but the gains representing a fresh record high for the company. releasing new ai chips, learning a new customers -- luring and new

customers. boeing fallout from the alaska air incident. fairly steady here, again when you look across assets, it was a range bound muted session. a big move came through energy, take a look at how wti has come online, we side up, we are seeing it holding fairly steady but it was the story of perhaps the weakening demand coming through against the picture of stronger supply. the fed move in treasury yields, a slight move higher, and also dollar weakness that came through, bitcoin, one to watch with the optimism for a spot bitcoin filing to be approved. >> optimism when it comes to the china monetary authorities saying another rate cut may be on the way to fire up what has

been a feeble recovery. bring in a global economic correspondent with us and history would show us that this kind of signaling we should take seriously because at least last year was followed by the cut we saw in september, but i do wonder, does this fix the problem of what has been lackluster demand a dwindling confidence? -- demand and dwindling confidence? >> the pboc being quoted that the central bank will support the economy through measures that intervene in the money markets or bring down the reserve rates requiring them to freeze up liquidity for banks and the economy. the point is though this has been a debate with china's economy, it does need shorter cuts from the lack of credit, the problem is the lack of spirits to go borrow banks, it has been on the receiving end of

cheap loans from the policymakers in recent months and we have seen major attraction in terms of turnarounds for china's economy. it will be a measure but the broader steps needed to get the economy up and running. it could mean if it happens, if the pboc does ease it would bring them in line with the rest of central banks, policy easing, the pboc was on a different path. >> when you talk about that power towards easing we have heard as well from key fed speakers, raphael bostic, shall boeing saying that -- michelle saying there may be a cut? >> where at an important point in the fed debate and raphael bostic out there making the point that inflation is cooling faster, heading back towards 2%, this is in line with some

emerging thinking from the economists now they are saying we have missed inflation on the way up, every chance we could miss it on the way down as well. the head of the banks have to get ahead of the curve. bostic made a point he has no idea or policy is at the moment, he was not signaling the need for a near-term rate cut, broadly speaking, the u.s. economy is pretty strong and lending down from consumers we have strong jobs data last friday and the fed has penciled in around three cut their forecast and they are trying to manage expectations. they have not signaled they will be reversing course or bringing down interest rates in the near term. that was of the message, inflation is going down and pretty fast, what is not there yet, they're willing to cut by ut they are not there yet. annabelle: that was from washington, we are tracking very

closely this hour, we have samsung due to report preliminary earnings for the fourth quarter, likely perhaps managed to stem revenue and operating profits and the three months in december. joining us for preview is a reporter, talk us through what is expected later this hour. >> samsung's and to announce its preliminary earnings for the fourth quarter very soon -- is set to announce its preliminary earnings for the fourth quarter very soon. posting revenue of 17.3 trillion yuan, little change from a year ago. operating income is likely to be at around 3.7 trillion yuan. while this is a decline of 14% year on year, it is a huge improvement from the 78% decline in the previous quarter. overall, the numbers may suggest that the biggest chipmaker is

recovering from very severe slump that weighed on the entire industry for more than a year. samsung and its peers cut production last year to try and stem the steep price declines. haidi: what are we seeing when it comes to the semiconductor division? >> the semiconductor division is the biggest revenue generator for many years until very recently when the industry went into a huge slope. we are going to get a picture towards the end of the month when the company releases full earnings and performance. as of now, it looks like the company's memory chip division may have reduced its operating losses in the fourth quarter and

analysts are expecting a consensus of 1.5 trillion yuan operating losses for the quarter. which is a big improvement comparative to previous quarters. we are, we do not have the whole picture, it looks like the company is on the introductory path for recovery. i think we will see whether the company's outlook that they announced in the third quarter, the market, it is due to 2024 whether that will happen later this month. haidi: that is in seuol, we will be speaking to where they think samsung is on the rebound. first, i details why china's deflation is poised for

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haidi: this is the picture as we see building gains when it comes to the early sydney session, we

are 15 minutes or so into the start of the cash session, the staggered trading underway, we are seeing given the big bounce and u.s. tech stocks, that really led the bulk of the rally and the outperformance in the nasdaq 100. we are shares the outperformance in -- outperforming, of by 2%, real estate and industrial's doing well off of more policy support out of china. the underperformer, energy as we see more volatility for oil. our next guest sees the stock market addressing unrealistic expectations, let us bring the market analyst at ig. that suggests you think market pricing when it comes to fed expectations is overdone? >> yes, i think that the markets

have pulled back, they are pricing in a 60% of a march rate cut. up to six times. i think it was way too high, one of the key reasons we are seeing the rally towards the end of 2023. you put it in this reset, it is quite healthy for the market. the self adjustment for what could be the realistic expectation that we can carry on into the months to come. at this stage i think it is quite healthy and helpful and beneficial for the market to reassess and go down the right path to go forward. haidi: when it comes to china that optimism has lifted parts of the australian market in particular we have seen the gains in commodities related names, as well as the aussie dollar, do you think the latest

expectations of a triple cut for the pboc is a meaningful development when it comes to hopes that they chinese economic recovery can get back on track -- that the chinese economic recovery can get back on track? >> my personal view, i feel not certain about what sort of recovery path china will be heading into. the key reasons is as we know china is stepping into the inflationary conditions and we are going to have the cpob showing that deflation stays and likely to be the most substantial pace of dropping prices since 2020. it will be the biggest risk for china in 2024, it will be wider if the price keeps falling. i will impact the profitability for the business and it will be cutting the production and the labor and push out the unemployment rate. all of this which i think will

likely lead to or generating the biggest issues for the chinese economy. i stay cautious about the economy all over china. haidi: does that mean, i suppose, multiple reasons why you potentially think the rally for the aussie might need to take pause? >> yes, i am quite cautious for that. i think you mentioned the aussie dollar has been up 10% for the past two months. one of the drivers is because the market believes that australia will be the last one to start cutting. let us -- if that is one of the key drivers and on the other hand, i think at this stage we are seeing going back into the u.s. side, to the china side, in the case we are seeing the u.s. pushing higher, that was the

hope for the effect on the cut in march and china's economy still kind of questioning what the aussie dollar needs and commodity. that will be a point for the challenge for the aussie dollar in the past two months. annabelle: where do you see opportunities across the region? >> i think that overall i still see that it is a strong economy. we do see china's economy but if you are looking back into 2023 we see india and japan and taiwan are showing quite a strong momentum in the economy. i think what we are likely to generate a longer term is the investors looking at u.s. markets and showing the appetite of the developing regions and the developing excess cost.

haidi: always great to have you with us, joining us from melbourne, we can get a round up of the stories you need to know to get your day going in today's edition of daybreak, terminal subscribers can find it on dayb and it is in the bloomberg anywhere app. you can customize those settings as well if you get the news and industries that matter to you -- so you get the news and industries that matter to you. this is bloomberg. ♪

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>> it is clearly not in the interest of anyone, israel, lebanon, hezbollah for that matter, to see this escalate. and to see an actual conflict and the israelis have been clear with us that they want to find a

diplomatic way forward. annabelle: that was antony blinken speaking in saudi arabia, he on his fourth trip to the middle east since hamas militants attacked israel on october7th. let us get more with vonnie quinn. what is the latest in what has been the key takeaways so far? >> the israelis have been clear that they would like to find a diplomatic solution but fencers are saying the time is running out for israel and hezbollah to find a diplomatic solution. this is coming on the heels of the latest attack which was by israel on hezbollah targets. a commander in the latino group died and was struck by an airstrike in an suv according to the associated press. the most senior has blocked militant killed since the attack by hamas and it has not gone down in lebanon.

it is not clear that lebanon will respond, but this has been the pattern so far. one seida strikes and the other side strikes something else and it continues on like that. the israeli prime minister was in the north of israel today and he was saying we prefer that this be done without a wide-ranging campaign. he is referring to returning the displaced families to the north of israel in a secure, environment. he said that israel will not stop without this being safe for those families. that will not stop us. if it is not in a diplomatic way, it will get done way or another. that is fighting talk from the prime minister of israel. you have the secretary of state antony blinken on this tour of the middle eastern countries along with turkey and other nations as well trying to get support for a calling of the situation so it does not escalate. it could be a confirmation any day and each day that antony

blinken has spoken he has mentioned this and he has warned that is all rhetoric and it is all warnings, deterrence is one thing verbally but what do you do about it actually? it is difficult to know if you switch to the united states for a moment, there are also protests in new york city where more than 300 people were arrested for blocking tolls but also where president biden was on the campaign trip to south carolina and he was at the mother emmanuel church when some protesters started shouting cease fire referring to gaza. cease fire now. biden didn't speak to them and said he understood the protester's passion and he is working with the israeli government to get them to reduce significantly and get out of gaza. it looks like israel is terminating in the north, terminating its operations to some extent in the north and is concentrating on the middle and southern part of the country at

the moment. would take more months for those operations to be done. annabelle: there is the question of course what happens in the red sea because this has been such a key area for escalation. and a lot of concern from the u.s. and its allies as well. >> antony blinken addressing this is another area where skirmishes keep on breaking out like in syria and the border between israel and lebanon. the red sea is actually having a very immediate impact on trade and coming up with the lunar new year, despite -- just five weeks away, cosco, saying it is going to stop dropping off any kind of goods to israel. it is the latest shipping company to suggest that its operations have been disrupted. this morning we saw interesting market action and we saw shipping companies drop on the news from a danish shipping newspaper that the individual shipping companies have made their own agreements with rebels in order for them to secure a

safe passage in this part of the world and the red sea. some came out and said that did not happen, and all of shipping companies, they would not talk with rebels but it does suggest there could be some other kinds of action on the way. antony blinken it can speak and he does and he says that 40 companies were now on board with the warning that they were warning houthi rebels something would happen if they did not stop. it is something to warn but what will happen with agreements between 40 countries is a whole another thing? it is not clear what that would be. qatar saying you cannot have a strikes happen because i would put us into a loop of tension and we will not back that. annabelle: vonnie quinn in new york, bringing your attention to some breaking news or the wall

street journal reporting, hp's in advanced talks to buy geo networks for $13 billion, this is for the wall street -- two by juniper networks. this would put hp in a better position to get into artificial intelligence. the two companies could announce it as soon as this week. it is another signal that we are starting to see global m&a activity picking up. indicate going towards the end of last year and the tech sector has been a particularly vibrant part of that. plent when people come, they say they've tried lots of diets, nothing's worked or they've lost the same 10, 20, 50 pounds over and over again. they need a real solution. i've always fought with 5-10 pounds all the time. eating all these different things and nothing's ever working. i've done the diets, all the diets. before golo, i was barely eating but the weight wasn't going anywhere.

the secret to losing weight and keeping it off is managing insulin and glucose. golo takes a systematic approach to eating that focuses on optimizing insulin levels. we tackle the cause of weight gain, not just the symptom. when you have good metabolic health, weight loss is easy. i always thought it would be so difficult to lose weight, but with golo, it wasn't. the weight just fell off. i have people come up to me all the time and ask me, "does it really work?" and all i have to say is, "here i am. it works." my advice for everyone is to go with golo. it will release your fat and it will release you. annabelle: breaking news, when

it comes to tokyo cpi we are seeing that number headline for december, at 2.4 percent, softer

than expectations of 2.5%, a pullback from the 2.6% we saw in november. stripping out first food we are seeing -- fresh food we are seeing falling expectations and lower than the 2.3% in the previous reading. tech volatile, energy, as well as food prices, a gain of 3.5%. playing on expectations of december and is harder than the 3.6% that we saw in the previous reading. that cpr when it comes to economic expectations gives pretty much around the edges, a clear signal that we are seeing inflation in japan slowing somewhat. the push from input price increases is -- import price increases, the yen, the week that was the worst for the yen since 2022. it is climbing thanks to the weakness of the dollar. hesitating to raise prices as

we are seeing selective nests from consumers as well. it does well with softer inflation adding two more reasons for the bank of japan to stay on hold in january. annabelle: a lot of economists not expecting any sort of policy change until april at the soonest. let us shift to tensions with china because we are counting down to some key elections and one of those is the taiwan one taking place on saturday and those tensions at the top of voter's minds as they elect a new president. the three top contenders making their final push to win support, steven engle has reported from a rally for the ruling party candidate vice president lai cheng-le. >> taiwan's presidential campaign into the home stretch with rallies across the island this week. trade relations with china and

talk a possible war makes this one of the most consequential votes taiwan has ever seen, we traveled south east of taipei to elon with ruling dpp met its faithful in a raucous evening rally. unlike the opposition and parties that favorite closer links with china the incumbent prefers maintaining a status quo of de facto self-determination. building a sovereign taiwan internationally. >> our president in elon stumping for the candidate that she hopes will replace her after eight years in the taiwan presidential office. that is her vice president, china has repeatedly warned that any pursuit of independence could lead to military action

against taiwan. >> warships and fighter jets keep coming from china as intimidation. when we have such an aggressive neighbor we must protect our territory. >> china has interfered in the run-up to the poll. muscles and final -- missiles and fighter jets. sometimes it interferes, through tiktok and other social media platforms. legislation on national security, we will be safer, especially security wise. >> taiwanese are distinguishing between autocracy and democracy in this election. people are worried about casting the wrong vote and losing freedom, and democracy for generations to come. this is why people feel this election is so significant. >> i support independence, there are challenges facing taiwan to

gain international recognition. taiwan does deserve a place in the international community. not blocked by china. >> does a victory mean we are closer to war? >> i do not believe so. if china wants to attack, china would have attacked long ago. i is very easy to defend. taiwanese people will roll itself. -- taiwan is easy to defend, taiwanese people will rule themselves. haidi: the two parties have special coverage on the taiwane se election continues. our top stories, boeing slumping the most in over a year when u.s. authorities temporarily grounded the 737 max nine planes after the blowout last week. the inspections on these grounded planes are turning up

potentially more problems that could allude to the installation of the store? door. >> alaska airlines have found loose bolts and planes that have received inspections. the full inspections the need to be done, that is going to take quite some time. with the faa has come out and said is that the carriers to return needs these jets back in service, they have to do full inspections of the bolts, fasteners on both the right and the left-hand sides of these big cabin doors and it will take some time, united has said it is going to take five technicians working for several hours on each jet. boeing has said that the types of bolts that are being questioned with the alaska airlines incident only found on that jet, not on the other family of jets. with those delays in returning the flights to full service, i think you expect to see quite significant flight rescheduling

requirements in the u.s. for potentially days to come, or weeks. haidi: it is interesting seeing how other industries are responding. we heard from emirates? >> emirates came out the other day and said this is really more of the same for boeing, they have had several quality-control issues. this is another one. listeners probably remember the boeing 737 crashes that happened years ago, a lot of deaths in ethiopia. boeing was recovering from that, a real workhorse of the guys was grounded for many years and it was back in the markets around the world and now they have this. boeing has suffered quality-control issues in the past around its 787 green liner, an aircraft with longer range, when it came out it was using a lot of lightweight materials and

this was outsourced to suppliers potentially problems around that. the problem tim clark was making is if you are an airline you are beholden to the wobbly here in boeing. or else you go when you want to buy a jet -- where else do you go when you want to buy a jet? annabelle: that leads bloomberg's transport news in asia. samsung's preliminary earnings, an under shoot of what economists had been expecting here. operating profit has come in at 2.8 trillion yuan below the expectations of 3.7 million yuan , 2.8 trillion won undershooting 67. the estimate had been for around 70, operating profit as well, two .8 versus 3.7. not great numbers. we have actually had been expecting them to stem the sales

slide. we were expecting more signals and a pickup in the chip recovery. not great numbers. let us get more on them with tom, he is the research director at counterpoint. what is your sort of since check on those numbers so far? >> the numbers are a bit disappointing. they are rebounding. i think that this shows that the rebound is going to be a bit slower than we all thought. the semiconductor market has been starting to recover since the third quarter last year. prices are rising. it looks like the pricing and prices are not rising that fast. the demand from certain sectors or not that strong. of course, smartphones have become -- and started to recover

since march of last year. i think the disappointment on profit is probably because of the marketing budget that was spent during the holiday season last year. annabelle: talk us through the marketing budget. haidi: how significant was the spending? it has impacted the bottom line so much. >> samsung has been struggling because of its premium products because the market now is very apple centric and apple is enjoying very strong performance. samsung has been trying to sell its foldable's and this series. each year, the sales have been declining a bit. i think last year, with a new foldable, and the iphone, samsung was trying to overcome apple's new products with its

foldable's. as a consequence, it had to spend and marketing budget. it is not easy to beat apple and its major markets like europe and the u.s.. especially in holiday seasons. i think the excess budget must have been spent for those products during the november and december timeframe. haidi: we saw the rollout of three new chips from nvidia overnight. looking to sort of fill the demand for what they call ai in pc's. how do you expect the rebound to continue to be on the back of demand related to eai given the exuberance of what we saw last year -- related to ai given to the exuberance of what we saw last year? >> ai is proliferating from the cloud to the various edge

devices including smartphones and tablets. this will probably be brightside for the market this year as we see ai smartphones coming out. nvidia's lead is kind of only enjoyed by nvidia until now. we see more chip manufacturers also producing a high products that will be built into high-performance computers and smartphones, tablets, pcs, and other devices. the ai trend is going to help the market. like i said, it looks like the rebound is a bit slower than everyone is expecting. we believe turnaround for samsung electronics on the semi side during february, march, timeframe, or probably -- where

they will probably break even. prophets will be on the mx side of samsung electronics. annabelle: how do you see it holding up against competitors? we have seen i guess a strong side would be on increased shipments. does that hold up if we are expecting to see more of the specialization product trend in the sector? >> right, i think that this, these new trends that are coming out in the market are kind of beginning and we will see this continue. ai and electrification computerization of industry will continue. like i said it is the speed and which sectors it affects the most.

consumer products like smart phones have been slow to enjoy this and samsung electronics as a result has not been able to enjoy that trend that much. it was more of an nvidia play. a server play. now, this year, we will see it coming to more consumer products. that will kind of continue throughout the year we believe. annabelle: what about the geopolitical angle as well? we have the chips in full effect and we have also seen for instance apple really losing ground in china to huawei because of patriotic fever towards huawei. china made smartphone devices. how will that help samsung over the coming year? >> that is one of the two big

trends we see in the market. ai on one side and two politics on the other side. it is going to become more severe like we are seeing in the taiwan elections, it is becoming more of a struggle, power struggle between pro-china versus pro-u.s.. this is also affecting the tech industry and samsung is right in the middle of it. you can say that samsung on some sides it is benefiting because some of its competitors were on the rise. they were coming from china. why mtc, smic, these companies were actually competitors of samsung. the u.s. policies have hampered their growth a bit. china is protecting its own market. it makes it difficult for samsung to enter the chinese

market. even, it is even difficult for apple as well. the splitting up of the world, the two kind of pro-chinese countries versus the p ro-u.s. companies will -- countries will continue to struggle and tech companies have to choose a side at one point or the other. we see that it will struggle coming back to the chinese market. and also serving chinese clients. that is one of the struggles that samsung will face during 2024. annabelle: thank you for your time, that was the research

director at counterpoint joining us with those earnings and a recap, the fourth quarter boasting an operating profit miss coming in at 22.8 trillion won over the period, down 35% on the year. you can watch us live for past interviews on our interactive tv function tv , you can dive into any of the securities or bloomberg functions we talk about plus 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. ♪ thanks to avalara, we can calculate sales tax automatically. avalarahhhhhh

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haidi: bloomberg bnef williams compare with 2023, following the top 28 summit which saw 200 companies or countries pledging to move away from fossil fuels. a analyst is with us, talk us through the key trends, developments we can expect over the market this year? >> we think we are seeing the solar markets, record high of prices and companies who are

facing the old production line. in the past 2023, the market growth by 64%, we will see 2024, another big year. it will slow down from the previous and exceptional growth in the past two years. this year the total insulation will exit 500 gigawatts for the first jump. we are talking 25% growth. from the supply side, it will hit record lows again. supply issues. we are excited to see the solar industry adopt a new solar cell technologies, companies are employing new capacities. they are phasing older capacities by older manufacturers. haidi: we projected over 20% growth and demand. why are we seeing solar stocks underperforming? what is the chief concern here?

>> i think there are multiple reasons, the oversupply issue across the solar supply chain. this older manufacturers are deploying much more capacity faster than the demand. we see the solar prices have halved in 2023 and we expect the module price to continue to go down in 2024 due to the oversupply issues. actually, this whole industry, historically, this year we are seeing a more challenging situation that even those leading in solar manufacturers are finding themselves difficult to maintain profitability. >> the record low of module price is playing into the dynamic of the industry overall? >> i think for the solar manufacturers, the record low of module prices means that they are having higher requirements about their production's cost

like the production cost is critical because even a tent of it can determine whether the solar manufacturer gets the price war in this year, a leading manufacturer will continue to leverage the cost advantage and squeezing out the competitors. using their very strong positions to play a game of chicken. following the solar markets, things that are module prices, it is a good thing for developers and also for others overall because it is loaned module prices, they can boost vulnerabilities and viability's also, like the nowadays if you want to be with the solar power plants, modules are no longer the most significant part of finding a proper electricity rate to connect to and become more critical. haidi: that is our bloomberg

solar analyst on daybreak asia. this is bloomberg. ♪

haidi: we continue to monitor the latest when it comes to bowing, the reaction, the ongoing investigation, after what happened, but flight on the

alaska airlines flight, we are seeing boeing up. they are saying in close contact with operator when it comes to these ongoing inspections during those inspections. this comes as we have seen the ground think quite global. in a statement boeing says as operators conduct the required inspections we are staying in close contact with them and addressing any and all findings. we are committed to ensuring every boeing airplane meets the highest safety quality standards. we regret this impact on the customers and their passengers and this of course is increasing reputational damage on boeing given we have those twin fatal crashes five years ago involving the maxx. we have seen boeing going to a possible

un-grounding. annabelle: want to be watching, the big slump in boeing and we are watching the start of trade, samsung. preliminary numbers coming out a few minutes ago, profit tumbling 35% and it tells us the weakness in the demand for consumer electronics globally, the demand for chips as well is not recovering quite as fast as perhaps had been expected. operating income coming in at 2.8 trillion won versus three point trillion won, undershooting. ♪

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>> this is daybreak: asia counting down to asia's major market opens.

we are seeing the revival of the -- going into this. a lift for tech names nai into the overnight session. head of the start trading in tokyo we are watching the slowing inflation picture potentially giving the bank of japan more time to consider his options. annabelle: certainly one given we have the boj meeting approaching, no changes expected, but a lot of economists starting to agitate for some sort of shift around april of this year. the start of the day's trading, we are going to kickoff with korea. we just had samsung reporting earnings in the last few minutes. this is the last trade you are currently seeing. we will await live pricing on this but at headline level, the take away from samsung was that profit tumbled in the fourth quarter here. six straight quarter of declining operating profit.

tells us there is weak demand for consumer electronics. there is weak demand for chips. that is really feeding into the outlook. you see samsung coming online a little bit higher up 1.3%. still though, the revenue for the company came in at 67 trillion won undershooting projections for 70 trillion won. we will get more analysis on what investors are really seeing as the positives out of the earnings report. we did have an video overnight reaching a fresh record high -- nvidia reaching a fresh record high. the korean won advancing a little bit against the greenback, a softer dollar on the wall street session. let's change on. we have the start of trading for japan here. back from a long weekend holiday as well. at the start of the day it is that brightness we are seeing across the screen.

mentioned the tokyo cpi, that is a leading indicator on the nationwide level and again it was that slowing over the course of december. so that is consistent with the boj assessment. the pressure on consumer prices is weakening so it does cement the hold in january. you are continuing to watch the japanese yen holding fairly steady so far. let's get more as we mentioned, the outlook for samsung and those earnings as we said, it did undershooting spect a. we have eulim lee joining us. what is seeing optimism from investors do you think? yoolim: as you mentioned, preliminary earnings in the fourth quarter were disappointing. the operating profit came at 2.8

trillion won, 35% decline from a year ago. this is a far worse declined than analysts expected earlier. quite obviously a lot has to do with chip business. we do not know exactly which division of the semiconductor business was the trigger for this. memory chip industry is widely known to be on the right path but we do not have a full picture yet because a company has not given the full earnings today. only the divisional performance will be given to us by the end of this month. having said that, there has been some optimistic signals in the korean exports, production data,

the semiconductor, the memory chip business is really the output and the exports are really on the rise. so maybe those are the early indicators that may be the worst may be behind us. >> they are also counting on the lineup of new devices and phones. we will get details as they are unveiled. how likely is that going to drive the growth given we are seeing weakness and worries about apple iphones? >> absolutely. samsung created a lot of buzz at sign think the summer of 2023, when they launched the galaxy -- the latest generation, full double phones. but we really do not know. we do not have a really clear picture how much the sales are happening, how much shipments are happening.

they had big plans for the foldable phone sector. they are the pioneer of the segment. we really do not know. but we are hearing from the analyst may be the full double phone shipments at the end of the quarter has not been as much as expected. i have a -- you know, a feeling samsung would like to really create buzz by launching the so-called a iphone. the new generation flagship phone they are going to launch on the 17th of january in california. so it is likely to have a lot of new features. of ai. we shall see whether that is going to live up to the hype.

>> there is yoolim lee. we have the nasdaq 100 accelerating. a lot of tech enthusiasm being driven by nvidia's announcement of the rollout of these new chips that are really intended to fill the demand for ai pc's. watching how that's going to play out in the asian session as well we are seeing resilience when it comes to trading in australia. no surprises we are seeing tech being the leader in the market. good gains when it comes to properties. every sector has been trading more or less in the green today. we see the potential wall coming up when it comes to the aussie dollar. the big gain since last october, the rally could be running out of steam or at least coming up to more resistance at the start of the new year. we are not seeing much of a move

when it comes to the fx side but a lot of that is due to the dollar rally using -- easing. a slide along with the fall in oil, the saudi price cut weighing on treasury yields. that of course lifted u.s. shares as well. we are seeing that slight outperformance if you will, or stability when it comes to asian currencies including stability in the aussie dollar and a little bit of again when it comes to trading -- little bit of a gain when it comes to trading in the yen. adding a little more to the timeline for the bank of japan yen normalization policy. 10 year treasuries at 4% bill gross sees as being overvalued. potentially that 10 year treasury inflation protected securities offering, 1.8% yield has the better choice compared to what he sees as an overpriced 10 year treasury spell.

our executive editor for asian markets paul dobson joins us now. i thought tokyo inflation was potentially interesting. i guess it goes to the reality that as we get each data point, particularly pertaining to inflation coming through from various economies, it could still add to the live debate over what central banks do this year? paul: for sure. the boj will be watching the inflation measures pretty carefully. much more important for them is the wage negotiations that happen at the start of the new year, particularly for the public sector and the private sector as well. to see whether the sense of inflation is a mindset is becoming more instilled within the japanese population. if wages can be sort of accepted as sustainably increasing year-over-year, that will give

the bank of japan much more confidence that inflation is entrenched and that it has finally managed to break the disinflationary cycle we have seen over the past couple of decades. the market is still looking for boj lift off to come probably april is the favored month. there had been some speculation it could come earlier even as soon as this month although the fallout from the earthquake is being seen as a reason to delay that. that is why we saw quite a lot of weakness in the end of the start of this year. but now the focus might turn again to have a look at the japanese government bonds and to see also what the boj does in terms of its defensive levels there. they have been lightening up on the purchases. that has not been too much of a problem because the rally we saw in bonds of the last year lifted jgb's with them. we have more equilibrium data. we might start to see pressure

on jgb's again going into the sort of mutual aiding session once we have all the holidays from the start of the year out of the way. >> what about the outlook for asian stocks generally? when you talk to traders a lot of them are saying they could beat u.s. equities over the course of 2024 even though investors remain optimistic on the outlook for the s&p 500. paul: yes, so the people we have been speaking to in a survey we have done have been relatively upbeat on the prospects for asia relative to the u.s.. a big key part of that is whether we will see a recovery in china's markets this year. has not started off very well. we have been down every session for the chinese market. we have seen the csi fall to a five-year low. we had this news overnight, more of the hints that more stimulus

is coming. could that help the market to stabilize and reverse? not clear from the commentary we are seeing so far. the market has priced in the prospects the pboc will be doing more, will be doing a rrr cut at some point in the first quarter. that's already kind of factored into the markets. the commentary we are picking up seems to be they would need to be much more aggressive to really turn things around from these levels and to really shift that sort of downward spiral basically that we have been seeing in the chinese equities market at the start of the year. haidi: it is interesting we are also seeing the waiting of chinese equities across indexes pulling back. on the flipside this is also a good thing because doesn't tell us the traditional anchor of china being at the apex of how emerging-market assets do is fading?

paul: i think that is definitely the case. china is being removed from or at least under-weighted by a lot of investors we are speaking to around the world. they are starting to shift the indexes they follow even, so the waiting they have to hold in chinese equities is diminished. it is happening in u.s. pension funds and around the world. so globally those holdings are shrinking which means the rest of the em is an asset classes less dependent on china for performance. not good for chinese assets themselves. what could fill the gap, could be more inflows from the global south, the saudi's, the uae's of this world and may be russia as well but we have not seen that making a notable difference so far which is why we continue to see this decline in the indexes

overall. annabelle: that was paul dobson joining us from singapore. taiwan's presidential candidates make their final push for votes ahead of elections this weekend that will set the course for relations with china. we report from a ruling party rally later this hour. first we are back live at the ubs greater china conference in shanghai with the bank's cohead of aipac m&a. ♪

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annabelle: the ubs greater conferenc -- greater china conference is underway bringing together policymakers and investors. let's discuss the m&a landscape after the sectors worst year in a decade which saw global deals missing the $3 trillion mark. joining us exclusively is samson low, cohead of aipac m&a advisory at ubs. thank you for joining us. not a great year for dealmaking globally, but still we started to see perhaps some signs of a pickup toward the end of 2023.

samson: yes, thank you for having me today. we have seen signs of optimism with a large japanese inquiry into the u.s. and other inquiries into u.s. and europe. that is building into the pipeline of 2024. i do expect 2024 to make a steady comeback in terms of deal activities. i would say a 10% increase over 2023 level. should be a nice step up from the last year. annabelle: what are the key sectors you are looking at? samson: the sectors have transformed a lot over time. there's been a lot of activity in the renewable and also energy transition sector. at the same time, health care is certainly important.

metals and mining globally have made a comeback and likewise it is translating into the asia and pacific region. annabelle: one of the big holdouts on the m&a front has been a lack of equity activity from private equity firms. huge drag on deal flow. what activity are you seeing from the pe's? so for the pe side, you know we have gone through nearly five years of not being able to monetize some of the assets. covid lasted about three and a half years and the overall lack of attractive capital markets alternative is making it difficult for some of the private equity firms to take the portfolio companies public. as a result eventually there has to be a discussion about exit levels and monetization. there has been an increasing number of interest in sale of majority stake or sale of the

companies who are strategic players. the private equity transactions i would say will come from ipo to m&a. annabelle: there's also an interesting dynamic, the competition among buyers. the landscape has changed as more potential acquirers, you have sovereign wealth funds, money from the middle east, family offices. more parties seem to be interested. >> that is certainly true. part of our job is to make sure the buyer selection is at the right level. there have been a lot of different varieties of interest coming from different angles. it is actually dependent upon us to have good bias selection when it comes to the ability to fund and when it comes to the interest level and the time of completion, especially for buyers that are new to this region.

it becomes very impossible for an advisor to exercise good judgment selecting some of these buyers. annabelle: buyers as well, we spoke to goldman and they were saying there is an interesting dynamic in the sense that buyers need to demonstrate what else they can bring or what they can operationally improve. is that sending you are seeing in asia? evolution toward a certain value added buyer angle? >> it is certainly important in the current environment. it is not just about being able to fund a transaction. it is about the operational expertise. any buyer can bring to the table. a lot of the time especially the sellers do not want to sell 100%. they want to keep a small minority stake the transaction so that very important when the

buyers can bring additional expertise. hopefully they will do business together even better and there is a further ipo down the road. annabelle: what about the landscape in china? what m&a activity are you expecting? samson: the prominent theme in china m&a the last 12 to 18 months will continue to be relevant. particularly two important themes. one is the multinational assessment of the china strategy whether it could be sale of a minority stake to local players or sale of a majority stake to local players for china private equity funds. this is what the multinationals are keeping us busy these days in terms of brainstorming china strategy. a lot of the china private equity funds or global private equity funds from the historical acquisitions of china, they are also assessing what they should do for the china portfolio.

he do something we discussed a few minutes ago. especially with there is a lack of attractive capital markets alternative. a lot of them are thinking about whether they should consider a sale of a majority stake or a strict sale to local players as well. these are the themes you will continue to see in china m&a. certainly the things that are keeping us busy. more mature markets like hong kong, there's the public to private privatization transactions, that's also happening a lot these days. annabelle: andsamson lo,l -- samson lo, and we will have more with the harvard kennedy school's cheryl lu. this is bloomberg. ♪ hello, brent.

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>> boeing says it will help address any and all findings during inspections of its grounded 737 max nine planes after united airlines found loose bolts in several of its jets. boeing shares plunged the most in more than a year. let's get more on this developing story now. danny lee joins us in hong kong. really fast moving piece but the latest does seem to be this statement from boeing. danny: boeing's statement comes as we await communication once again on how it might implement, airlines might implement fixes with regard to this door. the revelation overnight as well that united has found during its own inspections several of its aircraft with loose bolts, it moves the story forward

considerably. we do not know yet still if these door bolts are directly responsible for what happened to alaska airlines. that's going to come out in the investigation by the ntsb but some new lines there. annabelle: we heard from the emirates president. he has a history of holding not just boeing but also airbus to account when it comes to these issues he sees. he says at the end of the day airlines are beholden because there are only two players in this market. danny: right. making planes is an expensive business especially the r&d that goes into developing new aircraft. for emirates, they are ultimately interested in when they by multimillion dollar new planes that they work properly. emirates is the best making sure there is a high standard held. in the interview yesterday,

clearly he is frustrated, expresses his frustration over previous issues with other manufacturers and suppliers in the aviation industry. no doubt tim clark wants to hold the aviation industry to account here. annabelle: yesterday we were focused on boeing's shortcomings. today the story seems to have flipped to the focus on what alaska airlines was doing. we know that aircraft already displayed a pressurization warning light three times. is that significant? what does it tell you? danny: that is one of the key things that came out during the ntsb press conference. the fact the light came on three times. alaska airlines looked at this three times. this all happened at different phases of flight, especially the last one on january 4. it is not something you can easily determine as an issue when you are on the ground, a

pressurization issue. they did schedule this aircraft for further checks. unfortunately it did not get to that at that stage. for alaska airlines this is something they will be looking into. i'm sure investigators will look into it as well. haidi: coming up, taiwan's presidential candidates make their final push for votes ahead of elections this weekend. we report from a ruling party rally next. this is bloomberg. ♪

haidi: we have breaking news crossing the bloomberg. when it comes to the australian consumer, retail sales numbers as well as building approvals.

retail sales month on month at 2% really blowing out expectations of 1.2%. a staggering bounceback from the contraction of 0.2% in the previous month. november, a lot of the has been taking place pre-holiday season on account of black friday and cyber monday sales. retail discounting that is bigger than what we expected for just pre-christmas and preholiday spending in december. those november numbers are very strong. it will be interesting how that feeds through to the rba because it really split in terms of expectations as to whether the rba may have to do more due to the stickiness of inflation and the resilience of the economy. of course the cost pressures are seen to be weighing growth according to rba's own documents. building approvals just quickly seeing a gain of 1.6%. it does look like construction is still looking strong.

annabelle: certainly something we are tracking, the outlook for the rba off the back of that. heading into the session so far, pretty optimistic trading so far. you have the nikkei trading up 1.6%. that story is a little bit of catch-up because japan was shot for public holiday on monday. broadly we have gains across the screen tracking the wall street session and it was that story around big tech. nvidia reaching afresh record high. also to note on the tech front we had samsung posting its fourth quarter earnings just in the last hour. that was a miss from what animists -- analysts had been expecting. profit down 35%. weak demand for consumer electronics. weak demand for chips in turn. you see the snapshot, fourth-quarter operating profit 2.8 trillion won. the estimate had been for 3.7 trillion. still that stock is gaining up

0.7%. something else that was interesting, the impact of geopolitical tensions. you have the u.s. chips act. and you are seeing the likes of apple at least losing ground in mainland china to huawei. haidi: and of course going into a u.s. presidential election year where there is potential for more geopolitical tensions. certainly so much going on when it comes to the chinese economy. chinese president xi jinping has his hands full pledging to deepen this anticorruption crackdown and increase punishment for those who offer bribes. sectors highlighted include finance, infrastructure, pharmaceuticals, state owned firms. beijing's anticorruption campaign last year targeted a record number of senior officials including high profile banks. let's head back to shanghai where the ubs china credit conference is taking place in person. we will bring in surely you --

shirley yu. the last few days we have seen how much the anticorruption fight remains for president xi. we sell reporting into how it has potentially rocked the military. the rocket force program. what do you make of this given that this has been an ongoing campaign for over a decade now? >> thank you for having me. the security centric economic thinking is indeed a risk. that has been talked about at the ubs conference here. but that's largely driven by u.s. china geopolitics. i should say that happens on both sides of the dial there. fear, honor, and interest are basic political instincts and we

are seeing in china and the u.s. today the economic policy to a large extent driven by fear into a smaller extent by owner and to an even smaller extent --by honor and to an even smaller extent by interest. haidi: the problems with the property sector are structural in nature and i'm not saying -- certainly the bursting of it remains problematic at this point. how much of that is going to weigh on china's broader geostrategic ambitions ultimately? >> the release date is a risk. china is faced with a quadruple slump. real estate, the stock market, currency, and inflation. all of which indicate china is confronting a crisis of confidence, but back to your earlier question, what does that

really mean to the long-term structural growth and prospects of the chinese economy? we just heard yesterday the head of china's national bureau of statistics unveiled that china's gdp is likely to hit 126 trillion rmb. at the end of 2023 china hit the 120 trillion mark. i think china is still well on track to double its economy between 2020 and 2035. if we were to look from a lateral perspective, the chinese economy is as big as five of the g7 economies in europe combined. annabelle: china is increasingly relying on markets outside the economy to sell its products. how much can that persist given we are seeing governments and blocs like the eu growing wary

of exports in things like ev's? shirley: it does take a long time for some sort of technological research and development to become a true successful global enterprise. china ev's industry turned out to be the world's largest, it did not happen overnight. back in 2015 it was announced and it took china eight years or so. as a matter of fundamental technological sectors in china, in terms of building the next wave of economic growth drivers, there are more technologies on the horizon if we were to look at the quality of research in terms of the quality of the output, china is globally leading in new materials, new energy, telecommunications, some areas of ai, some areas of aviation. over time it is going to tie into new drivers of economic

growth. but if we were to look at the market there are increasing geopolitical tensions particularly in the trade area. china needs to identify new markets. we talked about by 2030 the chairman or ceo of the hong kong stock exchange talked about the sovereign wealth fund in the gulf is going to get $10 trillion in size. if we were to diversify 10% to 20% of that, up to $2 trillion will be invested in china up until 2030. those are substantial new partnerships for china. annabelle: talk us through that growing partnership. this is one of the most interesting parts of development in coordination between china and the middle east. how much is that likely to expand and how much can that offset the u.s. and other allies

increasingly turning their backs on china to some degree? especially when it comes to trying to hinder china's advancement in those key tech areas? shirley: i think china is a success story in internationalization starting from the export of labor, of products, the export of infrastructure, technology, and human capital increasingly. the success story is most prominently seen in the middle east, asia pacific, and africa. look at the traditional china middle eastern relationship, that was very much energy centric. china is the world's largest energy importer. that relationship is what's going to continue to be performed. increasingly we are starting to see transformation in a foundational area. we talked about increasing prospects of the gulf sovereign

wealth fund to continue to invest in china as western capitals we started to see increasing capital outflow from western markets. also look at internationalization. china's percentage in global trade finance has hit close to 6%. that's not an unsubstantial progress. if there was a moment where the petrodollar was going to be at some levels complement it by petro rmb, that would be a pivotal moment for the global financial market -- global financial architecture. annabelle: shirley joining us. we will have an update on china's growth outlook with wang tao.

tensions with china of course are the top of voters minds as taiwan prepares to elect a new president this saturday. as the three contenders make their final push to whip up support, stephen engle reports from a rally for the ruling party candidate, vice president lai ching-te. >> china's presidential campaign is into the home stretch ahead of saturday's critical vote with rallies across the island this week. strained relations with china and talk of possible war make this one of the most consequential votes taiwan has ever seen. we traveled an hour southeast of taipei to where the ruling dpp met its faithful in a rockets rally. unlike the opposition kmt and tpp parties that favor closer links with mainland china, the incumbent dpp prefers a status

quo of the fact of self-determination. building a fairly sovereign taiwan identity internationally. >> here in elon, stumping for the candidate she hopes will replace her after eight years. that is her vice president lai ching-te. stephen: leaders china has branded as separatists. china has warned pursuit of independence could lead to military action against taiwan. >> warships and fighter jets keep coming from china as intimidation. when we have such an aggressive neighbor we must protect our territory. >> china has interfered in the run-up to the vote. missiles and fighter jets are some examples but it only pushes people to vote for the dpp. sometimes interference is obvious. but also through tiktok and

social media platforms. they want more legislation on national security. especially cybersecurity. >> taiwanese are distinct wishing between autocracy and democracy in this election -- are distinguishing between autocracy and democracy in this election. people feel this election is so significant. >> i support independence. there are challenges facing taiwan to gain international recognition. but taiwan does deserve a place in the international community not blocked by china. >> does a lai victory mean we are closer to war? >> i do not believe so. if china wants to attack china would have attacked long ago. taiwan is easy to defend. taiwan is going to continue to rule itself.

>> steve will be reporting him the rallies for the opposition parties later this week as our special coverage out of taiwan continues in the lead up to the weekend vote. this election will be closely watched amid concerns it could spark wider conflict. bloomberg economics estimates were over taiwan would cost the world economy some $10 trillion. that is about 10% of global gdp. our chief geo-economics analyst jennifer welsh joins us now. obviously the baseline is not for military conflict at least for now. a lot of analysis goes into that. your analysis and the reporting, what is at play here? jennifer: we are not seeing eight crisis or war is imminent. -- we are not seeing crisis or war as imminent. as you noted, research suggests it could cost the global economy

up to $10 trillion. that is well beyond the blow of the war in ukraine, even beyond the impact of the covid pandemic. i think it underscores the stakes at play particularly given taiwan's critical role in advanced semiconductor production. >> perhaps an outside chance at this point but still the price tag on any sort of potential conflict could be something as well that is extremely offputting. jennifer: absolutely. our assessment is right now all sides that would be parties to this recognize that. from beijing's perspective they still support and are most focused on a peaceful resolution . their preference is peaceful unification. taiwan's perspective, the majority of people in taiwan support the status quo. there is very little support for

declaring independence. from the united states perspective, policy is really to maintain the status quo, to support the peaceful resolution of differences, and oppose any unilateral changes and in particular the use of force to resolve those differences. >> in terms of the practicalities of conflict, i'm keen to get your views on bloomberg's reporting which was pretty incredible looking at u.s. intelligence suggests the level of corruption within the defense industrial in china, we know high-profile purges took place last year. it is so extensive that could mean imminent war or significant military action is not possible or not considered by beijing at this point. >> that is right. the recent corruption cases undermine chinese leaders confidence that the pla is ready

for conflict including over taiwan which would be really difficult and risky for really any military. amphibious invasions are among the most difficult kinds of campaigns a military can undertake. we have seen historically with xi jinping he has been focused on addressing corruption and the people's liberation army for this reason. he sees it as directly relevant to the military readiness. he wants people to be in positions because they earned it. he wants people to be maintaining their duties and ensuring the highest levels of standards so he can have confidence when they are safe that they are ready for something, that they actually are. annabelle: that was jennifer welch. we will have plenty more to come on daybreak asia. this is bloomberg. ♪ thanks to avalara, we can calculate

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>> crypto under pressure but put it in context because bitcoin earlier above the 47,000 mark for the first time since april 2022 before the crypto crisis started. let's get more on what is

driving these gains. su keenan joining us from new york. it is continued optimism, perhaps profit-taking now, but continue with optimism around spot bitcoin etf filings. su: that drove bitcoin to a 21 month high earlier in the day. a number of firms who are prospective issuers of the spot bitcoin etf filing amended applications with the sec. that's one of two technical requirements that must be fulfilled before they can be approved. first the sec must sign off on the 19 before -- 19 b4 filings and approve the s1 forms. we saw a number one of -- a number of those being signed off as well. bitcoin had a run up on what analysts were saying was the final step on the path to approval. you can see that spike in the five-day chart.

the sec now expected to we inigh -- weigh in on january 10. gary gensler who has been against a spot bitcoin etf posted a note on at. -- on x. some saw this is a bit of shade. it notes investments in crypto can be risky. it notes some platforms have become insolvent and that such investments can be subject to risk. bitcoin pushing to levels not seen since before the collapse of the crypto sector in 2022. meanwhile there's been a bit of a rush by the prospective etf issuers to cut their fees. notably grayscale which used to be the only game in town. analysts have been pretty thing we would see this posturing ahead of any approval. >> $50,000 now within reach.

su: some are saying higher. the main projection is you will see an enormous inflow of money is the result of a possible approval. crypto is being -- bulls are saying $50,000 is the next stop. bitcoin touched an all-time high of 69,000 dollars in november, 2021 and last traded at $50,000 in december of that year. bullish reports from banks including standard chartered estimate that between 50 to 100 billion of inflow in a bitcoin etf's this year could really add fuel to the rally. we saw just in the last run up better than 6%. analysts are saying that is almost a certain response. a high likelihood this approval could happen this week. >> bloomberg intelligence putting 90% odds of that happening. that was su keenan joining us.

plenty more to come on daybreak asia. this is bloomberg. ♪

>> we are seeing a broad rally driven by the growth sensitive and price-sensitive sectors including that outperformance in tech really carrying on with the

big tech rally overnight. we saw the extension of the rally on the nasdaq 100 and a lot of that being driven by ai exuberance. nvidia rolling out those chips dedicated to ai pc's. we are seeing the likes of the tech space trading within the nikkei up by almost 4%. japanese markets at the highest since march 1990 at this point also seeing broad gains across other major asian markets. equities in this part of the world are set to outperform u.s. peers. potential rate cuts by the fed weakening the dollar. investor sentiment toward chinese stocks perhaps improving. that is the forecast from nine out of 11 asian based strategists and fund management's. the msci asia-pacific index lagging global counterparts. dragged by the persistent slump in chinese stocks last year,

expectations of a rebound a little bit tenuous. annabelle: that's right. also to note the movers tracking in this session, samsung posting modest gains even though we saw profit tumbling 35% in the fourth quarter. still seeing weak demand for chips. consumer electronics. sony as well, because that stock is higher, bloomberg exclusive saying they are planning to call off a $10 billion merger with india's z. lg energy is going to be reporting over the course of the morning. that stock up 0.6%. that is it from daybreak asia. more next. ♪

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>> welcome to "bloomberg markets: china opn.