australia must wait for an official result. uncertainty is the most -- worst possible outcome. will india supreme court lifted span -- lift the ban on diesel in delhi? shares have fully reversed post brexit losses. the regional benchmark climbs back above 130. look at the number and it takes us back to levels at the very start of 2016. markets,he chinese hong kong. stocks -- all but two stocks are on the way up. volumerom these two, still quite thin.

if you have to pick the big winners, precious metal producers. i will tell you why in just a moment. dollar, it aussie opened that much weaker levels for obvious reasons. it has now retraced its steps. notet want to mention this midmorning, they believe -- they see more aussie weakness ahead. whenever we start talking about it, it happens. the other market story i want to mention, the equity markets. these contracts are obsession highs -- are obsession highs. -- our off session highs.

a very good start to the trading week. wonka, the stock was halted in december amid a power struggle. we have the story. the pressure really on for van . e. back at theok reasons why it was suspended in the first place, you could call it a hostile takeover. the president -- this is what the president has been calling it. less than 5% to 23.5% and became the biggest shareholder, pushing

out china resources. the chairman -- could have a negative impact on the credit rating and reputation. vqnke is the largest traded property developer. they have been trying their best to restructure and find ways to wiggle out of the grasp in the last few months up of so. the resumption of shares today. yvonne: it seems like they will not hold the director removal proposal. there is this stock sale lineup with shenzhen metro. movess is one of the

forvanke to reduce the groep. vranke tothe moves by reduce the grip. it would make shanghai metro group the biggest shareholder. some groups do not approve of the strategy. these are the hong kong listed shares. rose.ng kong listed once they also gained on thursday, the last day before the friday holiday. continues because of the discussion to get rid of 10 of the 11 board members.

vanke has rejected this proposal. the pressure is still on. yvonne: the plot thickens. let's check on some other stories. after a dealment collapses. shares fell as much as 29% when trading resumed this morning. west china cement has lost almost half of its value over the last two trading sessions combined. an increasing number of economists predict chinese banks will receive a government bailout.

nine of 15 responded in the latest bloomberg survey to say they expect the mayo. move.ect the chinese lender's are grappling with the growing mountain of debt after years of flooding the market with cheap credit. brexit cannot legally happen without a vote in parliament. ifroup threatening action government starts the process without consulting mps. position is that it is a decision for whoever becomes prime minister. we have been talking about this morning. the australian election delivered no clear result over the weekend. let's get over to paul allen in sydney. what will we see?

say. it is very hard to it could be a minimum of 13 days before we know any result. it could be longer if there are recounts. we are in a state of flux. with 67 seatsling and the labour party 71. a lot of things have to fall his way. the reason for his confidence, pulling votes often go to the liberal party. leaders of both parties have been speaking to the independents. -- thosess bridges cross benches have yet to declare one side or the other. we are in a complete state of flux. voters have opted for a total policy paralysis.

this is the worst possible outcome for them. it could mean widening deficits first rally a and a risk -- for australia and the risk for the trading -- for the credit rating as well. yvonne: if that does not happen, is the job on the line? deliver -- inot the 48 hours, there has been a lot of discussion that malcolm turnbull could face an internal revolt. there are some examples in recent history that he may not. the former prime minister very nearly lost his seat after the first term of his government. he went on to win two more terms after that. a very -- if he manages to form

a minority government, can he manage it and it -- and can he fend off a potential revolt within his own ranks? much.: thank you so we have been talking about australian politics with our guest this morning. malcolm turnbull is not delivering. >> he has a credibility problem. he came in in september as a man who could deliver victory for the liberal party. the one thing you have to be in the liberal party is a winner. all will be forgiven if you are a winner. he is not seen as a winner. this will be a real problem in the coming months. zales says there

will be some volatility in the neck few days before things settle down. -- in the next couple of days before things settle down. >> i think the volatility will be relatively mild. think it will be short-lived. we will see something similar here in australia where there is an initial knee-jerk reaction. within a few days, things will come down. -- calm down. yvonne: how long can the next government survive? that is a question we put to our next guest. not impossible for a government to survive in a minority situation. we have had that in some states in australia and we've had that at the federal level when julia gillard was part minister. -- was prime minister.

, the green andd independent gave labor the ability to govern. this time it is unclear as to who and what demand they will make on the government of the day. yvonne: that is the word from asia. china faces a $500 billion bailout for its banking system if a recent survey is right. we will break down the figures for you. no clear winner as australian elections come down to the wire. decision made by the rba.

latest headlines.

baghdad's worst attack in a year has killed 115 people. a truck exploded underscoring the ability to extremists -- strike.tremists to with the streets filled with people. china has announced six days of naval exercises. where games will start on tuesday -- wargames will start on tuesday in the south china sea. the exercises, had of arbitrations on a disputed water from the hague on july 12. china has said it will ignore the outcome. demonic rapprochement between israel -- the diplomatic rapprochement.

it will be distributed this week. global news 24 hours a day powered by over 2600 journalists and analysts in more than 120 countries. this is bloomberg. look at what is driving the markets. really great to have you. calm hereing relative in markets. there is an uncertainty. what does this mean? >> no one really knows how long this brexit process is going to take. meanwhile, life goes on. if you look at the brexit market volatility, and oil prices would

be stable, they are concerned about the stock prices -- the currency markets are suggesting. at the same time, a reliance on central banks coming to the rescue time and again. mark carney is supposed to speak this week. yvonne: you talk about oil being quite resilient but you continue to see bond yields petty record lows. -- head to record lows. gold is really holding those gains. a still pretty conflicted picture. >> the market is expecting central banks to continue with its negative interest rate policy. from that perspective, we expect the volume to drop lower. developmentrs of

markets already in negative territory. it will push more investors to a riskier end of the bond market. way to play in a negative yield environment. it helps to put fuel on default rates. there is a great environment for proper debt and that is why investors are chasing the market right now. yvonne: the focus has shifted back on dividends. what sectors are you looking at? >> we are still looking at utilities, not so much the banks. the credit quality is in question.

asia, theyies in belong to the growth sector and still coming up with reliant and respectable dividends. while we're looking for dividends, it does not have to be defensive. it can be cyclically sensitive. yvonne: is the hurt going to be in the pound? some people say the real money investors have not even jumped back in to trade this. could it have further to fall? >> possibly. adjust.eed currency to has the pound been able to address the issue? position in terms of

the central bank policy? a lot of uncertainty in this election outcome in australia. the kiwi dollar and aussie dollar might reach parity. do you see this? >> i do not pretend to be an expert in australia. but what we have seen is similar to what we have seen, the established parties are losing support. the more nationalistic parties are gaining support. that will create a lot more challenges. happen, central bankers are expected to come to the rescue and that is where the currency market could reflect that possibility. yvonne: we are heading to record

lows. what does this mean for where they can go next? you could go up because of this credit rating at risk. we see the rba coming to the rescue as well. >> there is risk on the downside. -- aussie bonds considered high-yield. attractionnatural for investors to move into that space. the risk for rba is to cut more. yvonne: stick with us. next, hedge funds love -- everything has changed. we will have more about that. this is bloomberg. ♪

yvonne: two years ago china's online car marketplace was attracting support from hedge funds. but now, that is against the ..s. traded stock this one-time darling -- it seems like investors feel underwhelmed by this. >> this was one of the tech darlings of the internet boom in china. , this greater exposure to international investors. just a couple of years ago, the -- thatrged from 120% is when tiger management made a wager for a 15% stake in the company. that was in late 2014. within a year, it has unloaded

all of its shares in the company. investor interest taking on a different nature altogether. shows the interest has reached record highs. despite shares having lost half of the value last year. it is down about 45% over the past 12 months. been spending more to compete with its major chinese rival. this is a company that has been called the chinese craigslist, the chinese cars.com. revenue growth is projected to growth -- dropped 35%. furtherpected to ease to 20% by the time we get to 2017.

basically, what we are seeing, investors are not getting excited about what the company has managed to deliver after so much hype. yvonne: you cannot really discount the economic slowdown. haidi: that is right. when you have the consumer spending element in play, the economic slowdown is adding another layer of skepticism over this company. a very difficult operating environment. demand has very high exposure to the economy. investors may see a long-term benefit to the company, but they do not have high hopes in the short-term. fromes have the support

china's big tech giant. they hold about a 35% stake together. the company is trying to shift its growth focus toward off-line. they will have to pick things up very quickly. it has missed the streets expectations in three of the past four quarters. yvonne: not looking good. in sydney, we are still in this election deadlock. we are seeing shares a third of 1%. asian stocks rallying for a fourth day overall. a lot of emphasis on central banks. stocks.boosting hong kong, one of the biggest

leaders today on this monday. up about 1.7% on the hang seng. we will get the latest on japan's reopening after the break. ♪ get ready for the rio olympic games

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party's on! know what your pets are up to with xfinity home. xfinity. the future of awesome. see the secret life of pets, in theaters july 8th. >> asia-pacific markets have climbed back to where they were before the drop triggered by brexit. they rallied for a fourth day on expert it -- on expectations central banks will increase monetary stimulate -- monetary stimulus. shares in china's largest property developers slumped by the 10% daily limit in shenzhen. halted ine was december as its biggest shareholders fought for control.

tumbling innt is hong kong -- west china's cement is tumbling in hong kong. shares fell as much as 29%. they were halted last week on speculation the deal was in trouble. west china cement has lost almost half its value in the last two trading sessions combined. global news 24 hours a day powered by over 2600 journalists and analysts in more than 120 countries. this is bloomberg. looking quite good. before i show you what is happening across asia, have a look at this. seepossibility we might parity. every time we start talking about it, it actually retracts.

e rmb.o bring up the regeneron dollar for the rest of 2016. that is something to watch. asia is looking like this. we reversed all the post brexit losses. very solid session, volumes are quite heavy when you look at hang seng. elsewhere, volumes are still quite dim. a very good way to start the week. some of the names in australia. not surprising, gold, silver, platinum. that is your intraday look.

these threend why are among the best performing commodities in the first half. yvonne: australia is in the political limbo. elections over the weekend delivered no clear results. joining us now is our next guest. peter, really great to have you. how shocked are you buy this uncertainty right now? they were saying it was going to be net in neck. peter: that is right. looking like we will have a hung parliament here. that is only the third hung parliament we have had in the history of the federal parliament.

it looks like it will split both ways. it does not look like either of the two major parties are going to be able to govern at right. it is still likely the coalition will form a government with the support of a number of independent and minor party cross bench. that should probably firm up later in the week, i think. yvonne: how much of a blow has this been for malcolm turnbull? minister going into the election, his support base had collapsed in the early part of the year. he was faced with a difficult decision, either to call an early election or to wait until the end of the year. he faced a difficult senate. the cross bench senators were in no mood to negotiate with them

so it did force hand to go to an early election. that has not played out well. he clearly thought he would be able to ride the election into government, albeit with a reduced majority. that has not played out. he has been severely punished. the opposition has outperformed expectations. the media commentators, and some members of his own party. these economic policies, it is quite limited when it comes to the differences between the major parties on fiscal issues. what is going to be the ultimate deciding factor? aspects to that question. what will be the decider in terms of forming a government? the cross benches tend to lean

toward the conservative side of politics. the new members of the new centrist party emerging out of south australia probably likely to give support to the party that secures the most number of state -- seats. the broader question about economic policy, neither of the major parties have an economic policy. the most significant issue was basically a conservative set of tax cuts to businesses to do a bit of stimulus. the prime minister one into the election with expansive rhetoric on innovation. he never really spelled out what that was going to look like. yvonne: peter, you have done

quite a bit of research when it comes to media and politics in australia. we really have seen social media play part -- quite an important role from both parties. has it done anything to shift the political town? -- political tone. speak to this broader trend we have seen. think the degree of populist politics in australia is more modest than in those two jurisdictions. it has been relatively robust over the past decades but it has not been the driver toward strange political parties. a proportion of the movement is around some of these anti-party, anti-politics kind of groups. the social media role has been interesting. on thee trying to focus

specific electorates and constituencies. the impact is questionable. they have worked hard, but they did not have a lot of material to work with. one of the key ingredients is having a message against which you can target those constituencies with. labor was able to do that with regards to defending public health, which has been part of the major themes they have worked on. the liberal party racked up a little bit of ire by using quite an awkward snapchat filter to push at young voters this issue of economic plans for jobs and growth which became a source of great humor. a --ows you there is still .vonne: one last question we have seen this revolving door of prime minister's coming out of australia.

six prime ministers in eight years. is turnbull the one to lead australia forward? peter: it might actually be neither of those two. the current interpretation of the results, he has done well. he has outperformed expectations. he is in a strong position to obtain the leadership position. it is much harder to unseat a sitting leader of the labour party. he will make a strong argument, which is true that the degree of performance was in correlation with the unity. he is likely to be the leader of the opposition in the next three years. malcolm turnbull is likely to lead a government into an office, but he is likely to suffer from a challenge from the central right of his party.

he leads a very fractured and divided political party and one of the arguments that will be used to unseat him is that he has not been able to unify the party because he tends to be perceived on the left of this party. his party has a socially conservative and evangelical right wing. great to have you, thank you so much. a survey of economists say china will have to will out banks within two years. -- bail out banks within two years. who is making this prediction and how big of a bailout are we talking about? >> this is a prediction by economists about the health -- or not -- of china's banking industry.

it is to the tune of 500 billion u.s. dollars within the next two years. some put the number far higher than that. china would need a $10 trillion bailout. those are just predictions. obviously, there is increasing angst about china's debt pile which stands at about 247% debt to gdp. in the 12 months at the end of march, of all the loans out there, that is according to government data and many economists are skeptical about that data and those numbers and say the true scale is likely to be far higher. yvonne: what have we heard from when it comes to chinese

policymakers? have they responded? >> we have been hearing from the reassure, they did not respond directly to our survey, but they released financial stability report and they said china's banks are able to maintain their capital levels even if they are hit by severe shocks. beijing is pushing for the country's big four banks to have 2018.l ratios at 11.5% by if you look at the markets, it seems like they are already pricing in potential losses in the banking system in terms of valuations. china's biggest banks are trading well below their peers. many economists predict a bailout would hit the chinese markets and government borrowing

costs could spike. longer-term, a rescue would be positive. we have seen this before. they bailed out the banks in the 1990's. they did that by recapitalizing fourig for lender's -- big lender's. it was generally seen as a success. how will the government implement any bailout and what tools they would use and when they might pull the trigger? yvonne: tom mackenzie, thank you so much. storm as after the investors cool off. we will look at what is next for the u.k. this is bloomberg. ♪

people have appeared in

court in connection with last week's attack on istanbul airport. 44 people died in the attack for which no one has claimed responsibility. turkey blames the so-called islamic state. china has warned of severe flooding after days of torrential rain. authorities say flood controlled facilities have been controlled in recent years the rising waters pose a serious threat. a reservoir is already overflowing with 70,000 people at risk if the dam collapses. china's media has completed the purchase of a 25% stake in german robot maker for $1.3 billion. efforts to find a european suitor failed.

media also pledged reductions in china and to move into household robots. global news 24 hours a day powered by over 2600 journalists and analysts in more than 120 countries. this is bloomberg. yvonne: welcome back. i think it is interesting as we see this market volatility, the people are pricing and that the fed might cut rates. market issing is ining, the job market a good position. banks are starting to become a little conservative in their lending practice. have we started seeing the corporate sector roll back some

of the investment? like -- that could well be something to watch out for. i think we are on the verge of a recession. fed do?does the september,ve july, and december meetings. >> the market was pricing and no bike at all -- pricing in no hike at all. cycles.go through those if you look at the fundamentals of the u.s. economy, there will be at least one this year. signs of market volatility, that will push things back. an extremely gradual hike.

hiked by theot time of the elections, what do you see? >> the political environment does not play that much of a role. if you go back to the past number of elections, they may not want to move ahead. after the election is done, there is a clear outcome. back ontoll refocus the economy. such shorthave memories. before we forget all about brexit, what are the lessons learned? the smart investor would stay invested. , bondsor asset classes and equities, have done ok so far this year.

thing, you need to be well diversified. i am glad i have some fixed difficultit is very to look for a homegrown investment idea. that is thencome, easiest way to do it. >> i am confused as to where the remember the -- the rmb is going. thes look at it versus dollar. given that -- does that bolster the case for the yuan not depreciating more? right.ink you are gives the central bank in

china a much more flexibility to manage the currency. we have a g-20 meeting. running into those events, the yuan will be relatively stable. we may see a little more softening. throughout the summer, i expect a much more stable exchange rate. yvonne: pinpointy difficult to when the dollar bull run is coming to an end. valuation, using our

metrics, at a 10-year high. the valuation is not cheap. that we are close to the end of the dollar bull run. investors should refocus back into emerging markets. aussie, thatf the is where yields attract growth out of every place in asia, does the political turmoil effect that at all? >> not so much in the immediate future. the affiliation with commodities have been stable. will the new political environment or landscape change those ingredients for investors? so far, it does not look like it will be hugely different. if you look at what is happening

in europe, where we have seen coalitions that are not working, the actual impact on the market is somewhat limited. there will be long-term impacts. in the short-term, i do not think it is that big of an issue. looking at company cloud free technology. ♪

yvonne: automakers and environmentalists will be watching india today. the supreme court is holding a new hearing and there is a possibility of a ruling in the next hour. the city has some of the worst smog in asia. hints the court may lift the ban.

tesla missed delivery targets for the second straight quarter. 15% below the goal. tesla has had trouble getting vehicles to customers and expect to deliver 50,000 cars in the second half. are you ready for cloud anxiety? that may become a thing. let's bring in stephen engle. are they betting on solar cars? i kind of point that term -- solar anxiety. this is a vehicle hybrid. battery-powered,

lithium battery-powered. the main power source are these on the roof cells of the car. this is one of four versions they have launched over the weekend. anxiety.rain if you drive in a beautiful sunny day, a bluebird beijing day, you have to drive for about five to six hours to get a full charge. you get 80 kilometers range. that is about 50 miles. range anxiety and you will be looking at the sunroof whirring about the clouds. -- worrying about the clouds. yvonne: we do not need that much anxiety. >> the stock has been halted for more than a year. child, it poster

tripled in value in the hong kong stock exchange and dropped 47%. it has been halted. yvonne: lots of uncertainty. lot of analysts questioning about whether it is still a viable company. >> that has yet to be seen. the chairman has resigned from the listed -- listed company. yvonne: we will continue to watch that one. that is it for us here on asia edge. yousef: we will take you straight to the make a deal that is the merger between the national bank of abu dhabi and the first gulf bank to create $175 billion regional behemoth. we will talk with our guest about that.

that is coming your way. ♪ it for us onis

yousef: more details are released of the merger of the biggest banks in abu dhabi. the national bank and first goal bank will have assets more than -- first gulf bank will have $175 billion.an kuwait plans to raise $10 billion from the debt market to plug a budget deficit squeezed