, counting down to the open. it is that big camp down from investors to the nvidia numbers due out later, and the sky high bar, can we jump over it? haidi: and what happens to the rest of the market? we see more breadth being created, maybe a rotation into value. certainly, central banks are not further off, we have the rbn decision and expectations are to be unchanged, but we are watching for any nuances or communication about how close we are to easing. annabelle: not just the rbn but fed officials over the past hour, the boston fed president, susan collins, cleveland fed president, and also the atlanta fed president reinforcing this

need to keep rates higher for longer. there is progress on inflation but it is too early to declare any victory yet. what we are tracking this morning as we come online, with japan some eco-data. broadly we sell weakness creeping through, because exports are up 8.3% on the year. the estimate had been for 11%. we saw the trade deficit in the latest reading. that is the state of play for japan. tracking the japanese yen, holding steady this morning but still at historically weak levels. the big focus on the japanese 10 year yield because we continue to monitor when it will hit the 1% mark, and we continue to track those yields inching higher. japanese goodies under pressure in this session, so not that optimism from wall street overnight so far.

korea coming online, and the eco-data to note, april ppi coming out earlier today, we saw it rising 1.8% on the year. 0.3% on the month, but it was a pickup in ppi, producer price inflation. that presents a headache for the bok. we also watching in korea for the optimism around ai. south korea hosting an ai global forum. nvidia numbers are the real focus today, nvidia is one of the key suppliers for chips to samsung. a heavy weighting on the kospi. haidi: just a look at the first couple of minutes, in sydney, some upside, but flat at the moment. the futures was pointing to gains across the rest of the region. we these -- we did see some

declines yesterday, health shares were the biggest. watching for some of the minors, watching rio tinto after the force majeure declared on the aluminum, causing a big spike in aluminum which one he three-month high. aussie dollar is holding stott -- is holding steady. depending on the messaging from the rbn, how dovish that will be perceived to be. watching treasuries, we were heard from the fed reserve governor saying the continue softening of the data over the next 3-5 months would allow the fed to lower borrowing costs for 2024 but the take away is after several good months of data needed. take a listen. >> in the absence of significant weakening in the labor market, i need to see several more months of good inflation data before i would be comfortable supporting an easing in the stance of

monetary policy. haidi: we get reaction to that, if a professor had to assign a grade to this inflation report, it would be c+. a bit managing of expectations. if you wonder will it be the next print or after that, it will be several. >> a lot will depend on the internals and waller made it clear that a big part of the equation is what is going on with the labor market. a roundtable discussion makes the same point, they are happy with where policy is now. they see no reason to move rapidly from here. talking about inflation, we need to see more, and the job market is in a good place so there is no rush. very clear they will only rush toward interest rate cuts if

they see not just inflation staying soft but the jobs market starting to show real strain. that makes sense, they have been caught out a couple times this cycle by being confident inflation would not get out of control, then being confident it would keep coming down. they really want, as waller was saying, they want several a papers on the inflation front before they are willing to allow us to move to the next level and go to the rate cut regime instead of holding rates regime. haidi: they are kind of trending, expectations trending but above what they would like to see? >> yes, and waller is one of the more hawkish if not the most

hawkish central-bank head out there. he took rates higher more than anybody else and has shown a willingness to hold them longer even if it means recession. the labor market is showing signs of slack, and inflation is coming down but it is not where we would want it to be yet. that is why everyone thinks rbn will stay on hold. the question is do they make a serious shift toward putting rate cuts on the table. we had the contrast with rba with the minutes that came out yesterday showing they went back to thinking about whether a rate hike might be needed before deciding the best thing to do was stand pat. so far, the rbn has said rate hikes arnold unger needed but they are a long way -- rate hurts our no longer needed but they are long way from saying they will soon be needed, so any steps taken towards that will be

watched closely. if they take stronger steps towards that, you can see the kiwi fall, especially with the fed and aussie central-bank comments as a backdrop. annabelle: what else investors will watch for, that nvidia numbers, and that can drive momentum, and what it singles -- signals around ai spending. we are hearing commentary, earnings from palo alto, and that was foreshadowing what could be negativity. >> yes, it is a difficult day for equity investors because this time last earnings cycle, everybody was warning nvidia could not possibly beat expectations. it totally blew everybody away with what it saw going forward.

the stakes are perhaps higher now, we have had -- you mentioned palo alto -- there are others who in the chip space have reported things are good, but they are less certain about the future, the outlook. that is the key concern because the ai boom has driven a lot of valuations extremely high based on the expectation that earnings will catch up as it were with share prices at some stage. any sign we might start to get even just a maintenance of the current earnings momentum in nvidia rather than continued acceleration, that would cause damage to nvidia but also to the tech space more broadly, the s&p 500.

we have pointed out we have a long time without a 2% daily decline in the s&p 500. one of the things to underpin is this strong expectation that the ai boom is a game changer. if that game -- if the endgame for the initial burst in ai starts to come into view, that will cause a significant lessening in the optimism that the only way sustainable way for shares is up. annabelle: it is that high bar that keeps getting ever higher for nvidia and the market. that was garfield reynolds. the fed's waller wants more good cpi months.

today's edition of daybreak is also available on mobile. we have plenty more ahead. this is bloomberg. ♪

haidi: potential headwinds building over the next year for global trade come on not the least of which is china tariffs and potential retaliation. this is the highest level since the pandemic boom. bloomberg intelligence expected gee up little tensions could keep prices elevated. the outlook for the industry with one of the largest shipping industries in japan. joining us from tokyo is takeshi hashimoto, president / ceo / executive officer, mitsui osk lines. great to have you with us. we are seeing potential pricing looking more favorable as a result of these geopolitical tensions. you think more broadly on the balance, is that more of an upside or are you more concerned about the impact on trade volumes? takeshi: yes, there are various

factors that since the palestinian program, we cannot use, then generally the demand is tight. in addition, the total cargo volume from asian markets to north america and europe steadily increasing. perhaps this trend will continue for the time being. annabelle: how much concern are you feeling at the moment when it comes to the impact of u.s. tariffs on chinese goods, potential retaliation, any volatility following the u.s.

november election? takeshi: yes, it is too early to say but this can be a potential factor for us. today the total volume of the cargo flow from asian markets to north america is actually increasing, not decreasing. the reason is relocation of exports from china to other asian countries, including india. the increase of the total volume of asian-u.s. trade is quite steady in the recovery. that is our observation as of today.

annabelle: perhaps a little bit of weight and see come a but where you are being impacted is the sanctions on russia due to its war in ukraine, and we know you own three lng vessels that you planned to charter to the arctic project in russia. can you give us an update on what you are doing with those vessels? takeshi: yes, first of all, the existing lng projects are still not the target of sanctions. therefore, we continue to provide lng transportation from russia to the european and asian markets. as you mentioned, the new project to the arctic is a target, so we recognize we cannot provide that service to

our -- service to the arctic. we are studying how to transfer our business to somebody who can continue the business to the arctic. it seems very complicated in the political process, and we are careful about the details of the sanction regime. we should follow the sanction regime decided by the u.s. and other countries. annabelle: who would you be looking to sell to? and what timeline are you looking at? takeshi: it is not so simple

because it is very difficult to sell our asset to russian companies. it also creates the potential of the sanction target, so we have to be very careful how to protect our own interests, and without violating the sanction regime. haidi: how much extra money is being made as a result of the sanctions? takeshi: it is very difficult to say. if you look at the positive side and the negative side of the sanction regime, perhaps in

total we can gain quite a lot of additional income from the sanction regime, because it created a completely new transportation requirement for the global market. there are so many goods, before the sanctions, so many volume of cargoes coming from russia to the asian market. nowadays there is an alternative route that is a very long way from northern europe to asia and

the south african route. it created quite a bit of volume of transportation requirements. that is the kind of thing that created additional business opportunities for us. at the same time, we dramatically reduced our volume of trade with russia, especially the far east. if you analyze that of the sanction regime, to me, it is difficult to say, but perhaps not as much of a negative impact financially. annabelle: very briefly, we know the tokyo stock exchange is putting a lot of pressure on

japanese companies to improve their capital efficiency. our you looking to improve? takeshi: the exceptional one, the market is very volatile and cyclical, i want to balance the business work folio and have stable growth for the company. -- balance the business portfolio and have stable growth for the company. and to materialize quite stable growth for the coming 5-10 years. it will create additional value for our shareholders, i believe. annabelle: that was takeshi

hashimoto, president / ceo / executive officer, mitsui osk lines. you can watch us live and see our interviews on your tv function go, and become part of the conversation by sending us instant messages during our shows. this is for bloomberg subscribers only, check it out at tv . ♪ you're a rock star. we're all rock stars. oooo look look at my data driven insights, i'm a rock star. great job putting finance and hr on one platform with workday. thank you! guys, can you keep it down. i'm working. you people are (guitar noises). hand over the air guitar. i've got another one. so, what are you thinking? i'm thinking... (speaking to self) about our honeymoon. what about africa?

safari? hot air balloon ride? swim with elephants? wait, can we afford a safari? great question. like everything, it takes a little planning. or, put the money towards a down-payment... ...on a ranch ...in montana ...with horses let's take a look at those scenarios. j.p. morgan wealth management has advisors in chase branches and tools, like wealth plan to keep you on track. when you're planning for it all... the answer is j.p. morgan wealth management. haidi: supporters of taiwan's

new president -- lawmakers have begun the final steps toward this controversial bill. some of the scenes are extraordinary. never a dull moment when it comes to taiwan politics. >> obviously not.

what we saw last night was the largest public protests in years in taiwan as these protesters are trying to stop lawmakers from passing this new bill. the reason they are so against this new bill is because it is a remarkable expansion of the legislature's powers. the bill would give lawmakers the ability to call the president in front of them whenever they request the president, and he would have to present an annual state of the nation address similar to the united states. it would also expand the lawmakers abilities to investigate the government and expand their powers to request documents from the government. it would also implement fines for any government officials speaking to the legislature and have been found to told untruths

. that could result in prison sentences up to one year. on the executive branch this is seen as a huge our grab by the legislature and an attempt by the legislature, which is controlled by the more china friendly as an attempt to curtail the new president shortly after he took power on monday. annabelle: how much power do the people really have here? if they are against this proposed legislation, can they really block it through protest? >> that is what we will see over the coming days. last night the legislation passed its second reading, now goes to the third reading after which it will become law on friday. what we will see is a repeat of these protests friday evening,

potentially bigger. we saw about 10,000 people on the streets last night, according to our own estimations and local media. that should repeat itself friday when this bill comes to passing his final hurdle before coming -- before becoming law. this goes back to 10 years ago in taiwan when the government tried to pass a trade deal with china, and people took to the streets in huge numbers to protest, and managed to storm the legislature and occupy it for several weeks, forcing the government to shelve the bill. that was 10 years ago, that was the sunflower movement and a pivotal moment in recent taiwanese history, and is an example for these protesters. you spend time with protesters on the streets, they refer back to that.

they are saying some people will try to get into the legislature to stop the bill if possible. haidi: let's get you to futures opening in europe, we're seeing -- this is the picture with stoxx 50 futures, pretty positive. we did see the decline in european stocks, the focus on nvidia. and fresh clues from the fed. we saw an all-time peak on the stoxx 600. with german stocks we could see an upside. also watching>> thern

the demand for natural gas and the supply available. i they -- i think other factors

will cause that gap to widen further, things like electrification. as industry moves to reduce emissions and lower urban intensity sources of power. the natural decline we are facing will put pressure on the supply side. demand will continue to grow. the pressure will be more acute as we move out in time. haidi: take a look at some of the commodities we are tracking. aluminum is one of the shining aspects of this rally across broader metals and commodities. rio tinto issued force majeure when it comes to the shipment of aluminum from one of the queens land shipments, that's how the big spike when it comes to aluminum prices, at a 23 month high. we see pullback with aluminum

trade in london, looking flat. copper futures continues to push through with this rally. we see gains of about 0.3%. it has been steadying when it comes to copper and this record rise. we have seen physical trades overshooting risks as well, as we see a few concrete signs of a turnaround in china despite incremental and more significant measures announced. rio tinto up 1.3%. related to the china turnaround story, that big jump in iron ore futures, extending the rebound. the highest since early march. we are seeing iron ore names reacting. a look at the broader markets in terms of what is trading, in japan and across south korea and australia, a little struggle for direction. the nikkei offering a little

bit, the kospi on the back foot. in australia, bouncing back from yesterday, we are watching among other things, the rbn. kiwi stocks looking perky ahead of a meeting expected to stick to the current policy settings. annabelle: very much the count down to the nvidia numbers, because we will get the much anticipated quarterly results on wednesday. that will give investors fresh insights into the ai spending be human -- ai spending boom. let's get more from maribel lopez, principal analyst / founder, lopez research. a comes down to nvidia's ai chips in the demand for those, but what are you expecting when the expectations are already so skyhigh? maribel: i expect expectations to beat the general expectation. the demand for ai is superhot, they can sell anything they have that will come off the line for at least another year.

expect them to have blowout quarters. i think the market can be unrealistic in terms of the growth pattern that we have. nvidia is an extremely strong company, the bellwether of ai, doing grand. having said that, the market keeps pressuring them to over perform. we expect them to sell everything they have, and the question is how fast they can get chips out to meet the next wave demand -- the next wave of demand. annabelle: we sell that earlier today, we had the cyber security company palo alto, and they met estimates. perhaps it is foreshadowing what could be for nvidia if it does come in line. what you think they will say to really impress investors? does it relate to the new

blackwell chip? maribel: it is a long and short game. one thing we like about nvidia's strategy is that it is not just a hardware play but they will build a software revenue stream around it, and they are vertically integrated. when you look at health care, manufacturing, they have the ability to not just apply ai as use in chips to think about the industry perspective around ai, which means they can be part of the develpment cycle for a long time. really the issue is the one time of the blackwell chip and the two-timing of when they charge software revenue they are talking about, having additional a software revenue stream. it is a smart move for the company to diversify themselves being hardware and software. having very specific in a prize software to create -- very specific enterprise software is

the way we will be looking at it over the coming years. having said that, people are excited about hardware, that number drives billions in an organization. really, the timing of when this happens, people are constantly expecting them to outperform. there is a tenant pressure on them. they are the game to beat in ai, and everybody wants what they have. haidi: a lot of the lofty projections for growth will come down to the ability to secure supply. is there any concern or uncertainty on that side when it comes to taiwan? maribel: we always have a concern when it comes to supply because we have had such a tremendous ramp-up in demand, the fastest we have ever seen for any technology anywhere in the world. given that, there is concerns. one of the good things about concerns -- balance the good

with the bad -- there might be supply chain constraints. the optimistic side is there are supply chain constraints, there are margins in the ability to charge a premium for the product. it is a nice balancing for nvidia and there is not a lot of downside. for nvidia, it is about managing the expectation of how much growth there could be because the market expects them to over perform. it is a matter of what level level perform -- what level love over performance? it is the unknown of will hyper scalars hold back orders or other things. haidi: in terms of scale, we heard more details from nvidia about the tie up with dell about ai factories. how much does that create scale and simplify the incredibly complex infrastructure required?

do you think that is a game changer? maribel: one of the nice things about being in the gold rush era, if you sell picks and shovels, you can sell them to a lot of people. if you look at the announcements they made the last several months, they can sell picks and shovels with microsoft, with dell, with a wide range of companies they can go to market with up and down a high and low level. they are fairly well positioned. other companies are coming on with different aspects. we have seen interesting announcements with microsoft and qualcomm, or qualcomm and dell on the ai pc from. when you look through the data center, they have the opportunity to go to market with a lot of companies, and that can only be good for them. haidi: the superlatives when you look at the price is extraordinary. more than a 90% high this year.

i wonder, there are questions and bets being taken as to when it becomes the largest company in the united states. does this value compute with you, and we do see evidence of the big scale institutional investors taking money off the table more broadly when it comes to ai, will more be needed in terms of the evidence of this maturing industry for investors to feel this good about one particular stock, even if it is an video? maribel: -- even if it is nvidia? maribel: as long as they can continue to prove they are rapidly innovating, they have the opportunity to continue market momentum. this is the largest technology transition we have seen since the internet. it has extreme legs in terms of growth over the next 6-10 years. on that horizon they have

opportunity to create next generation markets. we have not even seen the robotics market takeoff, and they are ahead in the robotics market. you have to look at the several iterations of markets they can go for. we continue seeing more happening in health care. we see more happening in the manufacturing area and robotics. if they play their cards right, for the long-term they should be able to maintain the valuation and have legs behind it. the devil is in the details but they are looking at a forward visioning much more so than other organizations in that area. we are very optimistic that they have a strategy that will be good long-term. there are concerns, it is an extremely high valued company. if you are asking if the fundamentals of ai are there,

the fundamental of the ai wave is there. it is their job to make sure they execute to have the right technology to capitalize at the right moment on that. annabelle: that was maribel lopez, principal analyst / founder, lopez research. all that investor interest on nvidia's numbers due wednesday, but we will have a tliv blog that kicks off around that earnings release. stay tuned to tliv for commentary and announcements. let's stay in the chips space. asml and tsmc --in an emergency scenario such as china invading taiwan -- let's get more on this scoop. this is a fascinating, exclusive report from bloomberg. can you tell us exactly how that

idea works, and is it something we knew about that could be possible with these companies? >> i think there are two things to think about, the ability which the chairman of tsmc hinted at last september that they could render their factories in operable. what it seems to be is that asml has a kill switch up some kind which allows them to disable the extreme ultraviolet machines used in tsmc's chips and taiwan. even without such a capability, those supply chains that go into making these machines work, that go into making chips work are so complex and touch so many different countries, in the event of a chinese invasion of

taiwan, if taiwan -- if china invades taiwan, all of their supplies that go into making chips, the silicon wafer's, the chemicals, the machines from japanese, south korea, american and dutch companies -- all of those stop. there will not be continuing to export machines that tsmc needs or the engineers to maintain those machines. without such a kill switch in these machines, the ability to take over those factories in the unlikely event of a chinese invasion of taiwan, would not be able to continue to use them as they are used now. haidi: does it make a huge impact when it comes to china's ambitions?

there are suggestions that the restrictions we have seen have perhaps come too late in curtailing the development out of beijing. >> that is possibly true. you have seen those chips in the newest huawei phones. there are questions about whether they can get the yield you might want on those, whether they have enough, whether they are making enough in the accuracy is good enough to make that a commercially viable technology and make money on those. china does seem to be improving making higher in chips, and they are throwing so much money at it, you would have to assume they will be successful. they are trying to re-create a technology that already exists. the dutch were able to master the technology in the 1980's, so china is saying we will throw as much money at this is possible

until we are successful. in the end you would have to assume that brute force operation will be successful. how long it takes and how much money it costs are the questions. for the moment, the technology that asml has that they sell to tsmc is not available to china, and that is holding back their technological progress for semiconductors. haidi: more to come here on "daybreak asia." this is bloomberg. ♪

you know what's brilliant? boring. think about it. boring is the unsung catalyst for bold. what straps bold to a rocket and hurtles it into space? boring does. boring makes vacations happen, early retirements possible, and startups start up. because it's smart, dependable, and steady. all words you want from your bank. for nearly 160 years, pnc bank has been brilliantly boring so you can be happily fulfilled... which is pretty un-boring if you think about it. haidi: an investigation after

one person was killed and dozens of others injured. a singapore airlines flight hit turbulence. some of the images, the video is quite confronting. what do we know? abr --

avril: this was a surprising and traumatic incident for those involved. we're have singapore transport authorities are incontact with their thai counterparts, and they will send investigators to bangkok where the plane made an emergency landing. authorities in thailand are doing the same, and we also hear have singapore airlines has already said it is working with authorities. there were about 230 people on board when the incident occurred. they came from various nationalities, including the u.k., australia, india, singapore. this was supposed to be a routine flight from london heathrow to singapore, but when it was over myanmar, it hit severe turbulence. passengers described being in their seats one moment, then hitting the overhead compartments. it was quite startling for them. annabelle: do we have any sense

or understanding of what caused the turbulence? are we likely to see with climate change, these sorts of events continue? avril: we do not know yet for sure what turbulence this was but in general this is caused by rising pockets of hot air or gusts and storms and the clouds that come with it. if you go higher in altitude, you can see what is known as clear air turbulence, these are practically impossible for pilots to see, which makes them insidious. this is caused by the differences in speed in two air masses. it begs the question how climate change might impact this. it is difficult to pinpoint climate change to specific

flights because the data is not there. it is highly dependent on pilots' records. we have studies talking about how these climate change events in the past decade has prompted a 150% increase in turbulence, and some studies project this could double and triple in the decades ahead. annabelle: be sure to tune into bloomberg radio to hear more from the big newsmakers and get in-depth analysis on the bloomberg team. you can listen over the app, radio+. morehead. -- more ahead. this is bloomberg. ♪

annabelle: a chinese e-krona -- e-commerce company -- revenue doubling over the period, possibly beating its rival, alibaba. we are joined for a preview, and perhaps some people outside of this region might not be familiar with pdd. do you think, given the huge

success of that online shopping platform, we can expect another strong quarter from pdd? >> indeed, it is driving pdd's revenue and profit growth, so we are expecting a doubling of the revenue growth. taking a step back, we've only seen single-digit gains from alibaba and jd.com. it will again be a great set of quarter showing from pdd tonight. haidi: are you concerned about margin pressure? we have seen that as a trend over the last five quarters? >> that is a good question. clearly, the company is now venturing overseas, and overseas business is driving the growth. the business model, it is costlier because of the consignment models they have

undertaken to bridge chinese suppliers with customers overseas. that will hurt their margins from the high, but i think we can get the compensating factor from the high revenue growth we are seeing. we should still see profits grow in the double digits. annabelle: how do you see how pdd will reward investors, with a share buyback? >> pdd is one of the few remaining chinese tech companies that have yet to have a share buyback program, nor declared dividends. i would be surprised if they go in that direction, given that they are looking to invest more into the logistics network overseas as well as in china. there are users for their funds.

let's see how they look at shareholders and returns going forward. haidi: take a look at u.s. futures, only one stock in focus for investors at the moment, and expectations of impressive numbers from nvidia. the picture is flat at the moment. taiwan futures up 0.25%. we see a struggle for momentum at this point after the u.s. hit another fresh record high, the 24th record this year for the s&p 500 with all eyes on nvidia. this is at the heart of the ai boom. we are watching for the rbn rate decision, we do not accept the change in policy settings but the communication about what they are think about the balance of risks, and when the timing of

easing might begin. he has been very much on the hawkish side. annabelle: that decision over one hour in time away. tracking what is happening in the crypto space, take a look the big run-up in ether in the last one he for hours. -- the last 24 hours. off the back, you have that subsequent run-up in the token. this is bloomberg. ♪ with stock ratings from j.p. morgan analysts in the chase app. when you've got a decision to make... the answer is j.p. morgan wealth management. (♪♪)

the road to opportunity. is often the road overlooked. (♪♪) at enterprise mobility, we guide companies to unique solutions, from our team of mobility experts. because we believe the more ways we all have to move forward. the further we'll all go. just stop calling each other rock stars. and using workday to put finance and h.r. on one platform. tim, you are a rock star. using responsible ai doesn't make you a rock star. it kinda does. you are not rock stars. (clears throat) okay. most of you are not rock stars. oooh. data driven insights, and large language models. oh, that's so rock roll. it is, right. he gets it. yeah.

and they're all coming? those who are still with us, yes. grandpa! what's this? your wings. light 'em up! gentlemen, it's a beautiful... ...day to fly.

>> i would never bet against the united states of america