haidi: welcome to "daybreak: australia." markets have just come online. annabelle: our top stories this

hour. asian markets get a week lead-in from wall street on fears the s&p 500 rally went too far, too fast. traders also letting a key u.s. inflation rating this week will remain uncomfortably high. haidi: dramatic shakeup at boeing with top executives departing. annabelle: new zealand joins the u.s. and the u.k. in accusing china of targeting democratic institutions. haidi: and it's looking like a cautious start to trading as we get underway here in asia. the asx 200 looking like a bit of downside after we did see a rally yesterday, being led by the likes of estate and mining shares, offering some support as we did see those broader losses across the asia-pacific region. a little bit of softness as we come online, about .10% lower or

aussie stocks. we did see quite a bit of action when it comes to haven courtesies -- currencies, declining levels of volatility, quite a moment when it comes to emerging market currencies as well. switching out the board to look at the setup for japan, the unit still firmly in focus after we had the currency to delivering his strongest ethics morning that we've heard in months, but the dollar yen holding firmly above that 151 level. but we are seeing a little bit of upside when it comes to trading in nikkei futures. annabelle: some analysts saying 152 is where we need to get to before we see more than vertical intervention. look at some of the stocks we are tracking, against all that

backdrop of questions around the fed whether the rally has gone too far, too fast, is what we see in geopolitical tensions. according to reporting for the financial times, it could've gone up a little bit of a notch because there's reporting that china has adopted new guidance to limit the use of u.s.-made chips. so that fed into what we saw with intel, both of those weaker, we are hearing that software provided by u.s. companies like microsoft is also set to be replaced. let's take a look at what we are seeing for broader equities this morning. trading fairly steady so far, we did have that modest pullback in the session, the preferred inflation gauge is due out this week and perhaps it tell us the price pressures are still just too high for comfort.

we will have those calls around whether it's too fast for rate cuts and we heard from the atlanta fed president raphael bostic, repeating his forecast that we will see just one cut over the course of this year. we also heard from the federal reserve governor lisa cook, saying the fed really needs to take a cautious approach. take a listen. >> the risks to achieving our inflation and employment goals are moving into better balance. the risk of easing monetary policy to soon or too much is that it could allow above target inflation to become entrenched and halt the progress that we have seen. haidi: our next guest is still long u.s. equities and long the dollar. great to have you with us. we see signs that perhaps this run-up when it comes to

exuberance in u.s. markets might have gone a little bit too far. do you think that theme of u.s. exceptionalism and outperformance across asset classes continues? >> right now there doesn't seem to be anything standing in the way. you've seen a little bit of pullback recently but given fed commentary last week, the markets just saw this as a sign that there's not really anything stopping this particular theme. that is something we will continue seeing until we can find some evidence that you will have some attraction. that is the surprising part of it because you've seen so much crowding and so much talk about signals, it's been at a level you haven't seen since the tech bubble. haidi: so where are you finding opportunities, giving more valuation sit at the moment? the other popular narrative has been japan, where the market has also run up quite a bit.

>> this is a great question because investors have really taken hold japanese stock market. what was the most surprising, despite a pivoting policy, it seems to have already been baked into prices and investors are still seeing opportunity there and it will take a while for there to be a really big change in that market. i'm sure all of us are watching "given what has happened. annabelle: then what about u.s. equities, where are you seeing opportunities there? >> it's been pretty much across the board but clearly big tech has been ahead of the pack. there is some potential concern of overcrowding at this point so people are little cautious about could the rally keep going, but to be honest, we were asking the

same question a month ago and i think for now, there seems to be a strong view that strong momentum signals across the board for u.s. equities. haidi: you were talking about what could be the next catalyst to force a big move in either direction, perhaps that could be a earnings because we have that season approaching around men a cool -- mid april. consensus earnings have just been a little bit lower. are you moderating your expectations as well? >> earnings are things progress with cuts later this year. everyone is asking the question, what is something that will stop the train which is been such an incredible move in equities. for me it's really everything is about inflation. if inflation peaks up again there will be a reversal in terms of hopes for how many

cuts. as you just noted, some governors say one cut, many are hoping for three. you have to think about what could disappoint the market, earnings is one area but not is in focus yet for me. inflation what is been happening in the commodity markets has been the bigger focus. you seen some bigger moves that seem to bottom out until now, which means we need to keep watching the inflation numbers for now. annabelle: which commodities are you watching on energy? >> we've seen a divergence in the commodity sector. many of the agricultural commodities and metals have seen the disinflation theme which has started to revert or bottom out more recently, but also energy has been out of that trend. particularly oil moving quite a bit today, in the last couple of days.

let suggest pressure, we can still have pressure on inflation numbers, so the fact that the disinflation theme has started to lose some steam will be sort of a headwind for pce and cpi going forward. haidi: is there any opportunity you see with exposure in china or directly to china? >> this is a really good question, because to be honest, we are still seeing sluggish data. always going on this last week with the chinese yuan and how the currency moves are so extreme indicated there is still a lot of pressure there, clearly sentiment in the u.s. is not helping that narrative. so there was some recovery recently but it really doesn't have a lot of momentum at this point yet. so i think we will need to see potentially stronger intervention and more measures

to see that trend become stronger to the upside in china. there is definitely hope for that but we haven't seen it yet. annabelle: that was katie kaminski at alpha simplex group joining us. still ahead, we get the outlook for renewables, here the stock picks and why they see u.s. new energy outperforming europe and china this year. first we look at what boeing's customers and pastors want from a new ceo as the top executive step down, including dave calhoun. this is bloomberg. ♪

haidi: bond ship -- boeing shares closing -- closing higher after sweeping overhauls. the ceo stepping down i thing end of the year, and the chairman will not be standing for reelection. bloomberg intelligence says the departures are positive development. a lot of changes, is this enough to satiate the criticism? >> well, i think it is a start.

what probably happened is airline execs went to visit the board last week without a ceo in the meetings and i think they probably told the board, boeing's reputation is in real danger here we need some dramatic changes to shore up the confidence in the company. i think that's what we saw this morning with the resignation of ceo calhoun. there's a lot of work to be done this year. the most important airplane, the 737, they are going to negotiate with unions in september for a new union contract and they have to answer the faa on how they will stabilize production. so it's kind of strange to see him stay on through the end of the year, given the board had not even started to think about a new ceo. is probably confidence builder and now they need to bring in a strong ceo with the good manufacturing background and a

good engineering culture. they have to execute those things i just mentioned to prepare boeing to get out of this mess. annabelle: there's a few names being floated for possible ceo. do we know who the primary contenders are at this stage? >> i don't think the board knows. think it definitely comes from outside boeing. you want to bring someone in from a strong manufacturing culture, someone like larry culp out of ge you is done great turnaround there. it really focused on the manufacturing business, you need someone like that. i don't think he's available, you might find someone like that in some of the u.s. midwest big product companies like caterpillar or john deere. you need someone with a strong culture who will have a very high stature. haidi: $26 billion of losses

over the last three years, they need a major reset the on safety issues. what are some of the other frustrations, critics have said strategically they need a new direction. >> i think i probably need a new core airplane, that don't want to be spending all their money on development right now. but their plan has a distinct disadvantage against the airbus, its main competitor. we think the next generation jet engines have even bigger fan sizes. there's a number of things on boeing's plate that make this ceo job even more important right now. haidi: i think something developing a new aircraft is something that takes years of development to really bring to fruition. so it is a longer-term challenge perhaps, but what is something

they can do in the shorter term to appease the industry and regulators? are these changes at the top going to be enough? especially because he is the saying until the end of the year. >> i think what they need to do immediately and continue to follow up on is invest in their workers. some of the softer skills, they have to train the next generation of workers. the backfill has been difficult. that has been some of the quality problems. the challenges boeing has to give up on worried about margins and profitability is much as they worry about investing in their workforce in the have to go out and do that same thing, the suppliers they spent the last number of years combating as they were trying to bring in

components at lower prices and their own profit margin, boeing has to rethink things, especially at lower volumes post-pandemic and get back in that supply chain and make sure they are healthy, help them with their workforce issues so they can be ready to move to higher build rates. they want to be at 38% and they are not year that. boeing doesn't want to be left behind as airbus goes to higher rates on the 320. haidi: is the broader competitive environment changing? >> it will. there are some flying inside china. my last count was close to five. the chinese have to learn how to make it and support it. i think that will absolutely get

there, they have a lot of customers on their book, but it will take time. that's another challenge that boeing and airbus have. they want to be building their moneymaking airplanes, they want to be generating cash in those planes so they can design the next generation narrowbody airplane be ready for more competitive pressures. so this comes at a bad temper boeing, they would rather be investing in the business then manufacturing, because the competitive space is going to heat up. annabelle: that west george ferguson, thank you for your insights this morning. get more on boeing and other stories you need to know to get your day going in today's edition of daybreak. it's also available on mobile in the bloomberg anywhere app.

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haidi: australia is adding his voice to international concerns about malicious cyber activities it says are being conducted by china. new zealand, the u.s. and u.k. are accusing hackers of targeting corporations, politicians and british voter data. we have seen hacking in australia, has australia been a target by china? >> on this occasion, no. she says the other activity has obvious implications for australia, saying it's unacceptable and must stop.

this relates to a couple of instances in the u.k. and the u.s., in terms of the u.k. climbs politicians and democratic institutions were targeted. the u.k. is accusing china of accessing the details of 40 million voters held by the electoral commission periods part of a chinese state-sponsored group, china disputes at times. the u.k. accusations are said to be just a groundless accusation. haidi: there's a lot of voices in this debate and discussion because new zealand as well is saying they have been targeted alongside the u.s. and the u.k.. >> the complaints are piling up. we also heard from the gcs be minister, saying new zealand was

attacked back in 2021. there were links to another chinese state-sponsored group, the gcs be says that activity was contained and the hackers were removed shortly after accessing the network. but judith collins saying that was unacceptable. there is a risk for calling out this behavior because it is very train dependent. haidi: let's look at some of the morning because we're tracking ahead of the asian trading day. citi strategist says positioning is one side and levels are currently the most extended in the last three years, adding that investors could offer to take profits given the markets

leveraged to china. bank of america is seeing the risk of intervention by japanese authorities if the yen climbs to that 155 zone. they would likely conduct a smoothing type of intervention to smoothie ends opening. the japanese currency has been the worst performer this year, down nearly 7%. we have seen a little bit of return when it comes to the bloomberg dollar index, down about .32%. much more trading activity when it comes to emerging market and some of the more volatile currencies. the aussie dollar at 65.36 at the moment. dollar china pretty much unchanged that we've seen that

recovery in the yuan sending emerging-market currencies higher, boosting cup confidence within that em space as well. we continue to keep a watch on japan, that 152-155 zone is where they think that will see it. >> this is what we are seeing as well in the crypto space today. a modest pullback, but take a look at that level. you are back above 70,000 for the first time in about an week. 70,000 was a record high for the token as well. it has all been about the spot

bitcoin atf's being approved. it has generated a lot of inflows and we've seen a lot of demand for bitcoins. that has really spiked the price here. we started to see quite a lot of outflows, in particular from the grayscale bitcoin trust. that has certainly played into the weakness were seen for bitcoin prices. but it is that sort of assent, couple of different things we can track crypto prices in particular does that is take a look at 12 -- adam neumann has reportedly offered to buy the company for more than $500 million, according to the wall street journal who sources also say it is unclear how newman would finance a deal five years after he was ousted by the board. wework is undergoing

restructuring in the second quarter. apple, google, and meta risk heavy fines as the e.u. marches against strict new laws. the digital markets act as well as new gravity. we will have more to come on we will have more to come on "daybreati.

constant contact delivers all the tools you need to help your business grow. get started today at constantcontact.com constant contact. helping the small stand tall. haidi: raking data crossing the bloomberg when it comes to consumer confidence, confidence falling by 1.8%, falling to the gauge of 84. if you break that down, consumer sentiment at 84.4 is a

contraction of 1.8% month on month. a decline of almost 1.5% versus a year ahead. also a decline of 1.5%, expectations on the economy seeing a fall for the year ahead, at a significant contraction of 4.5%. looking little bit better when it comes to looking ahead. this coming in light of float was strong labor market data last week, that reposition some of the expectations around the rba suggesting they are in no rush to have to cut rates. potentially that we miss on the consumer confidence front showing how much households have been affected by this rate regime. annabelle: even though we had that reporting last week that perhaps australians could withstand for the rate hikes, but let's look at what we are seeing in the commodity space

this morning. iron ore just coming online in the last few minutes. if you think about where we were just a few days ago, we were closer to $100 a ton. so it has been a pretty big advance we are seeing. the largest one last week in six months. so it does play into the increasing optimism that we're starting to see a bit of recovery in demand from china. there's also the question if we will see more policy support coming through for the property sector as well and we are getting some reports to that effect. oil, just tracking those moves because we do see it holding steady at the $82 a barrel level. we're hearing that opec-plus is hopeful in its cuts until the end of the year. and geopolitics front and center , it is what is happening in the middle east.

the biden administration decided not to veto a un security council resolution demanding an immediate cease-fire in gaza. let's get more from our managing editor for breaking news, derek, is there any surprise on how israel has reacted? >> i don't think there is a lot of surprise on this. the u.s. and israel relations, certainly between the leaders, has been showing signs of a little bit of fracturing. that might be too strong of a word, but certainly a little bit of tension between the two of them. netanyahu has been irked by bidens cooling on some of the support for some of the things that israel has been doing in its war campaign after the october 7 hamas attacks. and joe biden really has a problem with prosecuting the

war. the u.s. has try to suggest that israel take different measures once some additional aid is going. none of this should be seen as a particular surprise surprise. it certainly is a little bit of an escalation of relationships but i'm not sure it particularly marks a change in u.s. policy in any meaningful way. the resolution here calls for an immediate cease-fire in gaza over ramadan and also calls for hostages to be immediately released, although it doesn't critically condition the cease-fire on the hostage release which was something the u.s. had wanted. but the boat was -- the vote was 14-0-1. the only question was whether or

not the united states would veto it, and in the end, they did not. haidi: it's interesting the symbolism of the extension of the veto. >> it should tell you that a democratic presidential administration is fed up with the way israel is going about things and would like to see change. this is one of the rare tools at the u.s. sometimes uses to signal that messaging. the last time i did so i believe was in the obama administration, which is quite a while now. the u.s. historically protects israel from all manner of yuan resolutions. the security council level with its permanent veto, and that is a little bit of a leverage point

in both directions. annabelle: do you think it changes the calculus at all for possible ground invasion into rafah by israel? >> i'm not sure that it does change the calculus. this is a lower level delegation that was supposed to go and have some coordinating units within the united states. it was not necessarily a net yahoo! visit to -- netanyahu visit to the united states. it was more of a signal. the you in doesn't have policing powers to go in there and enforce its own resolutions. a lot of this is symbolism between the two governments playing out, between israel and his closest ally on the world stage that has militarily supported israel and provided

any number of benefits over the years. i think having to defend itself diplomatically more than maybe it is used to, just the other day in singapore, for example, the embassy here was asked to take down a facebook post that the singapore government viewed as inflammatory. so if you're talking about this all over parts of the world, you're talking about a diplomatic situation that becomes more complicated for israel among nations that have historically been more friendly to it. haidi: even australia saying that israel needs to change its course. how to assist play out domestically for president biden , these strips by blinken for

example and the conversation with netanyahu being referred to as groundhog day. is that reflecting only going into november? >> i think that is certainly a consideration that is going on right now, is the fact that joe biden does have a correction coalition event. between them and others on the political left to her seen more favorable for the cause of palestinians. you saw this in the michigan primary, in dearborn, with a large number of people voting for uncommitted is set of voting for biden. it was sort of a protest vote. michigan is one of those critical swing states that joe

biden won last time against donald trump i needs to carry again. where he is trailing in the polls to trump, any of his main constituencies, if they don't come out to vote for him really present a big problem. remember, this election is not a national contest where the most votes win. this is state-by-state by state, and some of the smaller, swing states with smaller margins between them, it really can be down to a couple thousand votes. so anything that keeps people at home is a difficulty. the support for israel is something joe biden has had four honestly his entire political career. he's been seen as one of the more supportive pro-israel members of the democratic party for decades now. so he has a bit of difficulty on both sides of his political coalition. haidi: some of the other top

stories we are following, beijing says the philippines is building a military outpost on a shawl in the south china sea that it claims is chinese territory. calling on the philippines to stop what it calls provocations at sea. russian president vladimir putin has for the first time blamed islamic militants for carrying out friday's deadly attack on a moscow concert hall. he said investigators were still looking to establish who ordered the attack that killed 139 people. he is trying to convince the world there was no ukrainian involvement. here why the current lithium price level is making the

industry noble. this is bloomberg. ♪ h what if tax rates change? ahhhhhh filing sales tax returns? ahhhhhh business license guidance? ahhhhhh -cross-border sales? -ahhhhhh -item classification? -ahhhhhh does it connect with acc...? ahhhhhh ahhhhhh ahhhhhh

annabelle: we're focusing on the ev sector as we await the latest earnings report from byd.

it is setting its sights on taking market share from the likes of toyota and volkswagen through aggressive price cuts. byd has already flagged its four year income for setting a record , but investors will be watching how its deep discounts or squeezing the margins. meanwhile the founder of the world's biggest ministry maker says the country is blessing home with -- -- robin zhang told bloomberg he's not worried about overcapacity and will break up the output of more technically advanced products. working on a faster charging battery for tesla and supply machinery to its factory in nevada. let's discuss the outlook for ev demand, and bring in our next guest. he is managing director and joins us this morning in hong kong.

talk to us about the battery supply chain, we did have a report out saying that canada has now overtaken china in this supply chain race to have the most competitive one that meets the needs as well. is it really that trend of shaping networks at this point in time? scott: it's about cost leadership. anyone can optimize their supply chain, if i look at north america in general, inflation reduction act in the u.s., that was short-term a response to managing the supply chain were domestically in north america and i think that is what we are seeing. annabelle: so how does that play into your forecasting? is that given those measures that are in place? >> our argument on the new energy in the u.s. is that most

will see an uplift in profitability this year. you had some sectors last year that were little bit sluggish, in particular green hygiene. you've got that inflation reduction act kicker, that's why we see u.s. clean energy outperforming europe and china as well as the premium valuation to that sector versus the others. haidi: you look at australia and argentina, how much catch-up is there in terms of being able to catch up on the refining and the value-added capacity? scott: that's a good question. we are positive on lifting prices and the lithium price outlook. it's potential that the first quarter was the bottom of the lithium cycle, and you've seen like you mentioned in australia and chile, they are operating in

those deposits and particularly with the quality of those resources, they are actually pushing ahead with production growth type resource. see in the lithium market is that some of the high cost assets we believe the marginal cost is around $25 a kilo in terms of lithium. they are actually starting to curtail or delay protection growth. i think you will start to see in the lithium market quality come out and the high cost assets will come back. generally we think that will price upside this year. haidi: when it comes to the broader ev market, it's a pretty compelling argument to say it's all down to just government support and incentives and domestic initiatives. it changes the calculations to

how other markets can compete. scott: of course there is an element of that. the chinese policy over the last few years has been to remove coal, anything but cold. i think that continues. the industry acknowledges this. they acknowledge that gasoline, probably next year demand has peaked out in china and you will continue to see 30% growth in ev's, as long as the charging in the infrastructure around the ev's continues in china, that growth probably continues this decade and beyond. haidi: do you see any compelling argument for other markets to be able to catch up? scott: yes, to some extent. think particularly in north

america, and i think there's parts of southeast asia as well and parts of asia, but ultimately china is still 60% of the global market. it's going to take a lot longer than perhaps the market anticipates. haidi: back to my earlier question on geopolitics, there's always a risk that china would have an impact on the supply chains are different producers? >> specifically and ev? i think it could. although i would argue that some of the policies have already been put in motion. so it is difficult to see that dramatically changing overnight. if there we like to know about them much more longer-term.

haidi: scott darling, great to have you with us. the nes latest report showing for the first time china is not at the top of the ranking. china in the top spot, so what has changed, and what are the nuances there in types of the different kinds of strength that these two markets have? >> the latest show results across five key categories ranging from raw materials, access, manufacturing, growth and support industries, as well as the governors metrics. it's been one of the countries that was consistent in being in both categories.

it provides is a business friendly landscape that helps support growth in these very -- in these areas. china has established the supply chain currently at the moment. we seem consistent improvements in its support sectors and a strong foothold has agreed credentials that help it boost his position further, thereby overtaking china as it offers a lot of the future position supply chain narratives, especially in a responsible manner. >> some of the biggest moving's include the ranks of india and innovation -- what will boost their leveling up? >> countries in the asia-pacific region actually worked on their strength a boosting some of the areas where they really needed

improvement. the region typically computable -- has better than average rankings. it is now at the top half, or working us out to the top half. relative to its peers, especially in the asia-pacific region, he did perform really well this year, jumping up seven spots. indonesia has leveraged its nickel resources in order to have that engagement with the industry, to have developed domestic capacity in terms of refining. it's really a combination of those key factors that affect the region.

haidi: how important is its role in -- for nickel in batteries? >> indonesia's really leveraging nickel resources to advance its own goals and really coming up with a come additive -- competitive domestic sector. a lot of that has been done in such a short amount of time that industry estimates and projections for timelines have resulted in some of the plastic lines for nickel in the past year have been china's own investments in the region, people say would be graduate -- what we are seeing in terms of our outlooks is that indonesia

is on track to become a buyer of better grade nickel. it will be overall beneficial for the battery supply chain not just for the stainless steel industry dominated by nickel. annabelle: we will have more ahead on "daybreak: australia." this is bloomberg. ♪

annabelle: a live shot of tokyo this morning but the moves in the japanese yen, holding steady so far but still about that 151 mark. the question is what we will see from japanese government officials and we are here and again from suzuki, saying extensive ethics moves are undesirable and they will take appropriate responses to those moves as well. so bit more jawboning that we been seen across the past few sessions, something to track alongside the data because we just said producer prices rising 2.1%, in line with what economists, or the consensus from economies here but still above the 2% target set by the boj. the market reaction, we're seeing yen weakness, a lot of that is baked in. haidi: watching the yen very

keenly today. stocks we're watching when trade opens in the next few minutes, nissan targeting one million vehicle sales within three years, seeking to regain market momentum. asian crypto related stocks could move as well. global investors symposium is about to kick off in hong kong. we will be there live. ♪

♪ annabelle: this is "daybreak: asia." we are counting down to asia's major market opens.

we have equity moves and then also what is happening in the fx space, watching the levels of the japanese yen closely given a have the likes of bank of america saying 152, 150 five could be available to watch for intervention. haidi: we had some pretty stern verbal warnings in the previous session and that seems to be continuing today as well. suzuki talking about the undesirability of really strong fx moves in either direction. of course, this will feed through into potentially what we see longer-term for japan equities given a helping hand to have seen from the weaker currency. annabelle: that's right, we have definitely seen a weaker yen helping exporters. the question is whether we still see the weaker yen having a negative impact given that it does hurt consumers inside japan, and which one is more important for the equity driver. still, we have stocks coming online, the nikkei 225 and the