haidi: welcome to daybreak australia. markets have just come online. paul: we are counting down to asia's major trading opens. a positive lead in from wall street after dip buying sent stocks and bonds higher. big tech leading the way with nvidia tapping alphabets market value. haidi: morgan stanley said to be -- the first such move under the ceo. haslinda: prabowo has declared victory in the indonesian presidential election. now calling for national unity. paul: just opened for trade in australia of course. we have a staggered open but there are a few stocks we are watching in one of them is not trading right now.

we have just heard that japan is still -- going to acquire them in an all cash bid. 68.50 a share. this has unanimous approval of both boards subject to a shareholder vote. a couple other stocks we will be watching, treasury winds was out with results. a bit of a mix. a big retail mining industrial market in australia that had a first-half beat on net income. the 91 sent interim dividend a beat as well. a couple stocks to watch when those start trading in a few minutes. we have seen yields on aussie bonds slipping a little. the aussie dollar a bit softer

as well. we are of course awaiting unemployment data out of japan in a little while as well. haidi: we have breaking news it comes to spacex. we knew the background of this was probably likely to happen. spacex filing to convert to texas from the state of delaware. we have been charting this kind of exodus out of delaware. we have seen elon musk mapping his route out of the state, angling to reincorporate the ev maker to texas after the corporate judiciary unwound his pay package. investors could potentially help along with the process and we could see these potentially setting up conversations for other chief executives when it comes to things like reevaluation of report governance. 68% of the fortune 500 companies domiciled in delaware alongside the likes of tesla. obviously long been the preferred choice for big businesses.

we are seeing potentially a little bit of a shift away from that with spacex filing to convert their incorporation to texas from delaware. we will continue to watch that story but in the meantime take a look at how u.s. futures are trading. as we really kind of saw a bit of a pullback from the risk aversion we had following the hotter than expected cpi print. we did see potential for sin dip buying to come back into the market and that sets up more positively for asia. s&p futures unchanged. we saw stocks and bonds go higher following the slide triggered by the inflation print. looking at treasuries where the greenback treated from the three-month high as concerns eased. that also saw treasury yields fading lower on those inflation and sermons pulling back a little bit. yen volatility is when we are watching.

we see the dollar deflate a little bit and maybe pullback on some concerns. paul: the indonesian defense minister prabowo subianto has declared victory in presidential elections put on official tallies show the former general securing nearly 60% of the votes putting him on course to lead southeast asia's largest economy. our chief international correspondent for southeast asia haslinda amin joins us live now from jakarta. put his win into perspective for us. haslinda: you talked about how it is an unofficial tally. it is done by pretty much independent pollsters. even know it is unofficial it is significant because the quick counts have been pretty at -- accurate. you are talking about that 60% majority. it is significant. 60% is higher than all the

estimates given before the election. 60% is also higher than his own performance in the last two elections. by any margin it is a landslide and by any margin significant for him. third time the charm. it shows that is strategy has won, a strategy that relied a lot on social media, on tiktok in particular, and reshaping his own image. remember, this is the man linked to the death in poplar new guinea, linked to the abductions of student protesters. yet he is on the cusp of being the next president of indonesia. so that strategy to show himself as a softer man, you look at the meme on tiktok, he's reflected as a chubby, cuddly grandfather, and that has appealed to the younger generation. more than 50% of the voters are

the 200 million voters under 40 years old with no knowledge, with no memory of what happened in 1998. it also shows how critical the endorsement has been for prabowo subianto. that translated to more than 20% of the votes he got. in his victory speech he thanked just about everybody and a lot of those people relent -- the one who garnered the largest share -- this man played a significant role in the turnaround of his prospects. one thing to note, during his speech he talked about representing all of indonesia. he called for unity. he called for the people to put aside all the differences to move the country forward. this is quite a turnaround as well from what we are used to hearing from prabowo himself.

a very fiery man with a temper that is shown wherever he speaks. yet last night in his victory speech, he called for national unity. haidi: have we seen any reaction from the other two candidates? haslinda: they have not conceded defeat. in fact they both said they will wait for the official numbers. but they were disappointed because the numbers were way lower than what the polls suggested. it also means there is very little room for them to squabble with prabowo's win. but what is worth noting is not so much of numbers and the reaction from the two other candidates but the unease in the country. one, the resurgence of prabowo, perhaps a backsliding of democracy in the country. you may not know this but it is a young democracy.

about 26 years old. it started only in 1998. so it is hard earned and they have paid for it in blood. so there is a sense that there is a backsliding of democracy with prabowo back in power. there is also a sense of betrayal of some sort. he has put his son as the vice presidential candidate. he has his youngest son lady -- leading a political party and his son-in-law. so there is the sense that his buildup, a political dynasty, he came to the first person -- who is non-elite, no military, no connection whatsoever to a political dynasty. yet he is leaving office, putting in place a political dynasty. so there is a bit of unease. i think if there would be any protests that we may see linked

to that. paul: prabowo is expected to continue with business friendly policies. how are investors looking at this victory? haslinda: investors anyway have already reacted. the rupee increased more than 15% on the back of prabowo's win. what is crucial for investors is it was a single round victory. there was no suggestion of a runoff in june. that is what some people were concerned about. what is happening just behind me it is business as usual. if you compare this to previous elections we have seen, there have been incidents about this has gone without a hitch. no reports whatsoever about any violence. i think that is allaying a lot of concerns among investors and that may just propel markets to go higher.

the jci up 45% in the nine years of the administration and some say we may see it get to 7900, which is quite a run-up from here. haidi: chief international correspondent for southeast asia haslinda amin there, as we continue to monitor our election coverage. of course defense minister prabowo subianto set to become indonesia's next president as unofficial quick counts show he secured over 60% of the votes. we mentioned earlier prabowo had been linked to deaths. [indiscernible] live coverage of the indonesia election continues. we will speak with guests in closing prabowo's campaign team and a former indonesian trade minister. paul: morgan stanley is planning

to eliminate several hundred jobs in the first such move under the new ceo. bloomberg has learned the cuts will affect less than 1% of employees in the company's wealth management business. katherine doherty joins us now from new york. morgan stanley a -- signaled -- does this mean perhaps we can expect to see a few more job losses going forward? katherine: i think this is them setting out just a start. but they need to show to their investors they are serious about keeping the expenses down as they are also focused on really the most profitable engines at the company. ted pick has identified the wealth unit as one of their profitable, and one of the achievements that they have set forth is growing that business but also focused on margins. so these cuts are only 1% and

this is in a unit of 40,000 employees so it is only going to be hundreds if not thousands. that being said, it is a demonstration of what they are setting forth as the new agenda. keeping expenses down, keeping head count in check, while focusing on the most profitable part of the business. haidi: it obviously sets the tone for ted pick's leadership. how does this fit into what we are seeing more broadly across the developers with other banks, the restructuring we have heard of, and headcount reduction in places like citi and goldman sachs? katherine: it is both at the european and u.s. banks. it is the demonstration of cutting where you can. and then putting your resources into the businesses that are going to generate the profits that make up for some of the losses in other businesses. citi has taken a more extreme

approach to this under jane fraser. she has identified which units are the ones that are going to stick around. and then has cut others that have been a drag on the business. and each time that you see that announced or in the background demonstrated, it is going to be something that comes through in future quarters that they can show to investors that they are again focused on streamlining and then keeping the businesses that they think are going to be the best path forward. haidi: our finance reporter katherine doherty. michelle bullock says rate cuts overseas will have implications for rba policy. let's bring in our economics reporter joining us now. michelle bullock talking about inflation expectations anchored around 2.5% but being alert on the other hand of these expectations becoming on more --

unmoored. >> since the start of the month they have sounded pretty hawkish on inflation and have spoken really hard around where they see inflation. and the fact that services inflation remains high even though we are seeing goods inflation coming off from those very high levels. they are still pretty optimistic that inflation expectations are not unanchored. but that also goes to show their basically hawkish bias that interest rates will remain high. paul: it is interesting you say we have an overdose of rba information because she is saying there looking at ways to further engage with the media. swati: that was a surprise for us to them use proactively engage and media in the same sense. we are actually expecting maybe

we will have michelle bullock in our studio for an interview. haidi: she is welcome anytime of course. swati: they have a completely new communications team. they have a new communications officer in head of media and they were both former advisors to malcolm turnbull. the come with a lot of experience in different types of experience as well. one of the key recommendations from the review is that the rba needs to work more on communication. so it is a watch this space i guess from the rba. paul: previous rba governor's never give one-on-one interviews but may could change. still to come, donald trump said to be considering scaled-back commitments to some nato members if he is reelected to the white house. first we are going to hear from the ubs on their expectations of fed rate cuts as inflation continues to remain high.

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>> it is totally clear that inflation is coming down. we have had six, seven months in a row of the new flow rate of inflation has been very close to target or approaching the target. haidi: chicago fed president austan goolsbee on the latest u.s. inflation numbers. our next guest thanks the risk of high inflation doesn't change the base case from the fed this year. let's discuss with xi qiao, managing director at ubs. always great to have you with us. obviously we had the market reaction. maybe a bit of an overreaction if you look at the dip buying

opportunistic session we had just overnight. does this change your ultimate view as to what the trajectory will be for this part of the cycle? xi: no. we're still feeling that inflation is going to come down and expecting yields to start to drop at this point i think it is really just focusing on sticking with our base case for a soft landing and maintaining our portfolios invested at this point. haidi: so there is no valuation risk when it comes to where u.s. equities are trading at this point? xi: there is a lot of talk that u.s. evaluation is pretty high but given the strong economic data we are having and the outlook on the u.s. economy with earnings coming in very strong, over 80% already reported earnings. and the economy is propelling ahead.

we do not feel this is the time to field the market is too high and start selling out but rather maintain a diversified portfolio and stay balanced. paul: we have seen volatility starting to move off its lows. what are you expecting to see in terms of volatility and how are you hedging against that? there are always ways to hedge but i think right now most of the hedging has been done just through keeping a very diversified portfolio in maintaining the balance between equities and bonds. the selling out of equities at the point you already invested is very expensive. it is already a very good time to buy bonds as well. especially expecting yields will come down towards year-end and we are expecting 3.5% on the 10 towards the end of the year. maintaining diversification is very important as a way to hedge

a portfolio. also always looking to oil and gold. these are good sectors to do some hedging from a portfolio as well. paul: when you are looking overseas to hedge, how far you look? and i am thinking china is very cheap, but it is cheap for a reason. xi: absolutely. the china overall sentiment has been very depressed. a lot of investment has pulled out. the evaluation is very good there. there's a lot of questions and a lot of concerns and there needs to be some real tight of concrete policy steps to support the economic recovery. so hopefully further loosening of monetary policy is on the way and with more fiscal expansion, growth will come close to around 5% this year. but i think within chinese equities we are still overtly cautious and we prefer arbel

strategy focusing on defensive and high-yield sectors in the near term. haidi: geopolitics is the big overlay this year. how does that potentially impact risk, particularly headed towards november? xi: it is hard in such a good market right now with all the rallies. seeing the type of risk or to think about the risk. with all that is happening in russia and also the middle east, russia ukraine, and u.s. and china tensions, this could also spur volatility in the markets. a lot of the good news has been priced in. so investors are looking for continued good numbers come a continued good information for the market to continue prove -- continue to propel. and we still feel the economic outlook is strong right now. haidi: how closely correlated is china for the rest of emerging markets right now? because we have some markets

very well-regarded within asia like indonesia and india. also japan. do you expect to see further flows into these markets as an alternative to china? xi: absolutely. that has been one of the areas where a lot of growth is happening and a lot of money is flowing. particularly southeast asia, india, vietnam. these are markets that are really substituting some investments that used to go to china. but china is still a huge market. it really depends on the policy steps will come into play to support this economy. as we are very cautious and these other emerging markets are an area we are extremely interested in and a lot of investments are flowing into these surrounding economies. paul: all right. xi qiao, financial advisor and binging director at ubs. nicu so much for joining us. you can get a roundup of the stories you need to get to know

in today's edition of daybreak. subscribers go to dayb . it is also available on the bloomberg anywhere app. you can customize your settings so you only get the news that you care about. this is bloomberg. ♪

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paul: all right. let's take a look at some movers in australia. lengthy of them. let's start with treasury. wind reporting first-half earnings. the stock higher by 1.7%. first-half net income was a miss. u.s. business is not doing too well. the dividend was also something of a miss. i beg your pardon, that was in line with expectations. treasury signaling it is hoping to get a development on the

china front. some news on china wine imports still having some trouble getting its product in there. let's take a look at origin, surging, 2.7%. origin also out with results and blew expectations out of the water. almost $1 billion profit and upgrading its full-year outlook as well. haidi: we will be having that conversation a little later on thursday with the managing director and ceo of west farm on the firm's latest earnings. that interview taking place at 3:30 p.m. sydney time, 12:30 p.m. watching in hong kong. more to come here on daybreak australia. this is bloomberg. ♪

haidi: take a look at how we are faring. seeing some uplift as we start

to see some markets that have been largely closed for lunar new year holiday start to come back online. in sydney we are seeing some solid gains. tech in particular really leading the way with gains about 2.8%. consumer stocks also putting on over 2%. energy down by about 1%. we are seeing a little bit of return of risk appetite after the shock repricing following the harder than expected u.s. inflation numbers. we are also hearing from michelle bullock speaking this morning in her testimony saying inflation expectations are well anchored around the 2.5% level but also drawing attention to some downside risks and downgrades related to the likes of the chinese economic slowdown as well. of course geopolitics is the other big risk and domestic politics too in such a big election year. defense minister prabowo

subianto declaring victory. let's get back to jakarta. haslinda amin is on the ground with our next guest. haslinda: that's right. trying to put in perspective the big win by prabowo. deasy simandjuntak is -- good to have you with us. put this into perspective with us. how did prabowo managed to garner 60% of the vote? deasy: this is the jacoby factor. he's the decisive factor guiding the voters to form their political preference. this is not an unexpected result. even higher than expectation. the hierarchy, how it is won,

how the three candidates scored are pretty much the same with what the polls have been showing us. prabowo had been running on it incumbent ticket and promising that they will continue policies if elected. of course he did not conceal his preference for prabowo. so this is attractive. haslinda: it is also about a young -- about younger voters won over by a media strategy invoked by prabowo. what does it mean? what does it reflect on the younger population in indonesia? deasy: this is an interesting thing going on. the young or first time voters, 52% of them. so a large proportion of the total voters. they are relying on social

media. and of course they did not experience the 1998 reform moments. and i'm speculating here, but questions and concerns on the human rights aspect of the background of each candidates or of fair at terry and is issues did not really matter for certain youth voters. but of course we also saw students protesting. there was a big protest spearheaded by the students and civil society. there are two different kind of youth voters here, but i think the majority of them have said that they would like. haslinda: prabowo is known as a strong man. is that the strongman they voted for? what is it they voted for? deasy: this is a very interesting question.

i do not think that the youth voters were voting for a strongman image. if they rely on social media, you see how tiktok has very light content on prabowo. [indiscernible] haslinda: he is 36 years old. deasy: this is the thing that the youth voters were voting for, not really a preference for a strongman image or a strong state for indonesia going forward. haslinda: civil society is very concerned about a possible backsliding of democracy, a democracy that they had to earn. what are you seeing in terms of the journey of democracy in the country? deasy: we have seen this in the past weeks, more than 64 universities have voiced serious

concern about this particular issue. this is the conundrum of democracy. democracy is about the majority votes. and the people would like, or prefer this candidate to lead indonesia. and so quantitatively, he will be president. well, according to the quick county will be, and this will be only a single round election. for indonesia going forward that means the checks and balances mechanisms have to be seriously conducted. the oppositions then would have to function really well so that the power of the executive for the government will not go unchecked. that is the thing. we are actually excited or interested in what this means

for the political reconfigurations in indonesia going forward. we also heard the news about perhaps a meeting. we do not know what discussions that will entail. these are all exciting moments. haslinda: there is also concern about political dynasty put in place by him himself. his son and son-in-law holding various positions. a lot of people feel this is a betrayal. deasy: it is one of the challenges indonesia is facing at the moment. but the opposition or civil society would then have to continue to voice their concern. i am sure indonesian democracy is consolidated enough.

haslinda: thank you so much for your insights. deasy simandjuntak, indonesia studies program visiting fellow at the institute. we are waiting official results expected in several weeks. people in the meantime are mulling over that massive win, according to the quick count, by prabowo. paul: all right. haslinda amin there in jakarta. other geopolitical stories we are following, israel has pulled out of talks on securing a cease-fire with hamas, refusing to send a delegation back to cairo for further discussions. benjamin netanyahu again dismissed militant group's demands as delusional. israel's position suggests even a temporary cease-fire remains far off as fears grow about war -- about more than one million palestinian refugees sheltering.

tensions between israel and hezbollah have intensified after israeli towns and an army base came under attack. a barrage of missiles blamed on hezbollah fighters based in lebanon prompted israeli fighter jets to launch extensive trucks on the iran -- some israeli politicians have been calling for more aggressive action against hezbollah. former u.s. president donald trump said to be considering scaled-back commitments to some nato members as he attempts to return to the white house. sources tell us a trump is also looking to get ukraine and russia around a negotiating table. michael heath joins us for more. let's start with those nato remarks. we are dealing with hypotheticals here, but if we see a second trump presidency, could we see a two-tiered nato? michael: that is the implication. it is important to say that he is raising an important issue, and he did that in his first term too. europe has been freely known

that has been freeloading on the u.s. -- europe has been freeloading on the u.s. that is not in doubt. but the reality is that he is almost talking about separation from the alliance. that is what the bottom line is. perhaps having one or two countries he is prepared to go to war to defend. we have seen this situation where the u.s. disengages with europe and it was in the 1920's and 1930's after the first world war led to terrible conflict as we know it. what has kept the peace is the transatlantic alliance. that is the point he is missing. yes, you have to press these guys, they need to be spending more, but there are bigger issues at stake. he is a man very strong on economics and business and that security has underpinned the success of the world in the past 70 years. haidi: we understand there is quite a bit of discussions going

on about in addition to boosting spending it could make the alliance more palatable to a potential president trump again. some things include focusing on his core issues like china for example. michael: it is not an unreasonable point. to an extent nato became less and less relevant after the collapse of the soviet union. it was only the aggression from russia in the past decade that revived its role. but it has a role to play in furthering global security. there is an argument to say that it needs to have a more definitive approach when it comes to china and the need to engage more with the u.s. on that. the to and fro is important. when the u.s. began nato, europe was in tatters. europe has become much wealthier and much more stable and they need to step up. so he raises some valid points. it is just where we end up getting as a result of that is what is concerning here.

paul: pushing for a swift conclusion to the war in ukraine should he get a second term in the oval office. how does that come about and what does it mean for ukraine? michael: it does not come about. i was at vladimir putin's first press conference in 1999 and he has never changed. he respects strengths and despises weakness. all trump has done here is encourage russia to stick at this fight. because the prospect of him cutting aid to ukraine, russia could easily drag out talks on the negotiations or anything like that. russia began the conflict and russia could stop it. the idea that you put them around in negotiating table and take away ukraine's support and that will lead to a solution, that is just not going to happen.

haidi: some other global headlines we are tracking, at least one person has been killed and 21 others injured in a shooting during a celebration of the kansas city chiefs super bowl victory. three. people are in custody in custody and the incident remains investigation. the shooting happened near union station, an entertainment center in kansas city. more than 800 law enforcement personnel were on hand to handle the crowds. indian police fired tear gas at the border as thousands of farmers try to march on the capital new delhi to protest against cost pressures. an organizer says around 25,000 tractors have been gathered. the farmers are demanding guaranteed crop prices and debt relief. the protest is a political headache for prime minister narendra modi. more ahead here on daybreak australian. this is bloomberg. ♪

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so, my best friend sophie says you've been a huge help. at ameriprise financial, more than 9 out of 10 of our clients are likely to recommend us. our neighbors, the garcía's, love working with you. because the advice we give is personalized, -hey, john reese, jr. -how's your father doing? to help reach your goals with confidence. my sister's told me so much about you. that's why it's more than advice worth listening to. it's advice worth talking about. ameriprise financial. paul: south korea's kospi has become asia's best major gauge this month. overseas investors have stepped up purchases betting on local regulatory reforms. for more let's bring in asia stocks reporter yukon li. what is driving this recent rally? >> since late january we have been seeing this sudden rally in

the benchmark kospi in south korea which drove 5% gains this month making it one of the bust performing stocks in the world. what is driving the rally is the bet that the south korean government's upcoming push to reform corporate governance and improve shareholder returns have been driving the shares up and drawing inflows of foreign investors. haidi: you mentioned foreign investors. what are they buying? youkyung: four and investors have been buying value stocks they are seen as cheaper than overseas peers. typically tech stocks draw massive inflows to south korea because south korea is a tech heavy market with the country's two largest stocks being memory chipmakers. but we are seeing companies like hyundai motors drawing more than $1 million on a net basis so far

this month. that's really unusual because that is more than the foreign buying samsung, sk hynix, and other stocks also bought like kia, samsung. the common theme in these stocks is that they are the stocks that trade below their value. this comes from the bet that the south korean government is going to unveil -- of these companies trading lower than their book value. paul: on year we are up about 8% on the kospi. what is the outlook? haidi: the outlook for the kospi -- youkyung: the outlook for the kospi is still bullish. relatively low holdings for the stock market so there is more room to add foreign inflows for the kospi members. also in south korea unveils more details of the upcoming reform push which is seen as replicating japan's success,

depending on the details, what kind of details that has, it may draw more inflows. there is a chance that unveiling of this new policy may be kind of news but we will see what kind of initiative the regulatory bodies in south korea is going to unveil. haidi: asia stocks reporter youkyung lee. also watching japanese shares. the nikkei 225 is a little further away from the all-time high, 3% away from the december 29, 1989 high. the index has massively underperformed since then. the rally in japan has been quite impressive compared to what we have seen globally. technical signs seem to support further bullishness. this week has been quite challenging in terms of reaching that record high but we are pretty close. winnie: yes we are.

i think with the u.s. cpi yesterday, it is falling back a little but overall the trend is still pretty strong. technical indicators, first of all we see the put call ratio declining as the index is going up which means there is more optimism of buying japanese stocks versus selling it. we also see that foreign buying is strong. we see five straight weeks of buying from foreign investors. so that inflow is still very strong momentum, seeing that investors are still quite positive, even when the stock price has been pretty high are ready. and we also see from the turnover, basically the daily value that is traded, very high trading activity. the turnover was at an eight month high just earlier this week. so that also shows that people are very excited about the market itself.

paul: you mentioned foreign investors. no doubt a yen at 150 is very appealing to them. is that the whole story? what else is driving the bullishness? winnie: the weak yen has been a strong push but that is not it. this week we are seeing something special recently around earnings. we see very positive earnings and share prices reacting to that. softbank and toyota jumping, and tokyo electron jumping on adjusted forecast, having a pretty strong earnings beat. and also longer-term stories, that reform is driving investor sentiment. and i think most importantly, for example you see the deflationary environment in china. japan is actually exiting their deflation and heading into inflation. so that is something that really

drives confidence in investors. paul: all right. asian equities reporter winnie hsu. gdp numbers for the fourth quarter. annualized gdp declining .4%, a pretty big mess. the survey was for a 1.1% gain. the gdp deflator also a miss, 3.8%. the expectation was 4%. the yen still very weak, 150.50 at the moment. that big mess on the gdp numbers. we mentioned that the nikkei is 3% away from an all-time high reached in december of 1989. since then, japan's economy has grown at an annualized rate of less than 1%. haidi: and some of those numbers, quite interesting, a bit of weakness for private consumption, business spending

falling. you mentioned weakness in the and and it creates an interesting conundrum for the bank of japan in terms of that rapid fall. policymakers being quite concerned given the rhetoric and the job owning we heard yesterday. no intervention at this point but as a further dimension to when the bank of japan can, as a best timing for the first interest rate hike, it would be the first since 2007. expectations at the moment in terms of what we see from the boj, expecting governor ueda to raise the rate either in march or april. earlier would give more support for the yen, but there is also the issue the boj might be reluctant to give the impression it's responding just to market moves. the weakness in the yen has really been one of the big drivers behind this japan equity rally. we are about 3% away from that 1989 high for the nikkei. bloomberg users can interact with the charts we have been going through. they are featured on bloomberg

tv and you can browse all of them to catch up on key analysis and save the charts for future reference. this is bloomberg. ♪

haidi: cisco announced plans to

cut thousands of jobs after a slowdown in corporate tech spending. a restructuring plan will affect roughly 5% of the firm's workforce, or 4000 jobs. cisco's forecast fell far short of forecasts. uber jumped the most in 18 months after announcing it will buy back as much as $7 billion in shares. it comes after the ride-hailing pioneer reported its first full year of operating profit and consistently positive free cash flow. the ceo said the repurchase plan is a vote of confidence in uber's financial momentum. paul: these are the stocks we are going to be watching when trade opens shortly. keep an eye on shares of sony as it prepares to partially spin off its financial unit in october of 2025 to focus on the growth of its other senses such as entertainment and image sensor anchored we will also be -- image censoring.

-- for $5.9 billion. rakuten scrapped its dividends pay out shore up finances. it has been hurt by five years of straight losses. tokio marine is also on the radar as it increases reserves to cover passable -- possible bad loans. also coming up, ocbc bank explains why they remain overweight in japan, neutral on the u.s., and european stocks. and indonesia shares their thoughts on how the election results will impact the nation's economy and markets. market opens in tokyo and seoul next. this is bloomberg. ♪

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>> this is daybreak asia, we are counting down to asia's major market opens. haidi: was to contend with, we have japan, the number surprising, slipping into recession, clouds of the way forward for the bank of japan, particularly with how strong the yen has been. we are also looking across the continued percolation of said messaging and how that side of things affects markets. or uplift today. paul: japan is interesting, the numbers unexpected. is this stagflation or are we doing violence to the word? earnings out of australia as well. haidi: some of those earnings clouded the broader macro outlook into some concerns about the fed's trajectory. let's get you straight to the start of trading in japan. ahead of that, we have more breaking news, numbers out o