>> asia-pacific markets expected to follow wall street's rich treat betty: the dollar -- retreat. the yuan faces new challenges. this is the second hour

of "daybreak asia." 7:00: it is just after p.m.. i am betty liu. i get the feeling we are going to hear more about these jobs coming back to the u.s.. we will see whether that fuels this rally in the equity markets, although right at the top, we did see a brief break. sinceecline, the biggest october. we are not doing bad if that is the biggest. yvonne: it was apprising, we could actually see some red. kind ofd like it was ugly, relatively speaking, with the dow losing more than 100. asia, watching closely to see how things are performing. theres no diplomatic

way to say this. you look at the bid asks. it looks like it is going to go down the toilet again. 311 was the close. the latest bid and ask, waiting toshiba, orders for 250. 255 if we are lucky. we started out the year roughly at this level. the nightin, up until before christmas. chances are, if it does fall let's wait for that to get underway. we will take you through the gyrations. jeter thing we are watching is the strength and the japanese yen and the dollar. the yen strengthening against the dollar. .ollar-yen 117.03

a summary of opinions from the last meeting of the boj. one memory basically saying, it is a long way to go before they can achieve the 2% price target. keep the policy settings as is. they have also noticed improvements in the economy. an improvement when it comes to consumption. something to keep in mind. yield, year treasury adding one dollar and ounce. have a look at equity markets. there we go. last full trading day for australia and new zealand. watch the currency there very closely. on, i would keep my eye on southeast asia.

a strong rally. linedhow the pieces are up, it seems that is going to unwind itself. we are watching toshiba and how it opens. let's get to the other top story. targeted -- china may be dropping its target for growth. shery ahn joins us. what exactly is behind this change? shery: we have seen the commerce department in china, a key conference. they did not set a target for 2017. a state run newspaper saying this might be because top policymakers are backing away quote of itey call growth targets. this is not surprising, given the uncertainty in the growth

targets. you can see chinese trade has been declining. we can bring it up on the bloomberg. the white line, imports. pretty volatile right there. it is not that surprising. these officials are dropping their growth targets. one official saying, abandoning a target is more appropriate for conditions under the new normal. we are now seeing this departure from tradition. we are seeing the yuan continue to fall. the lowest level since may of 2008. of course, also reactions to the

soaring u.s. dollar. this yuan,cing breaching the seven per dollar level. the pboc same reports the one broke the seven per dollar level were inaccurate. as far as we know right now. >> we saw certainly trade volumes spike up. a suggestion we could see capital outflows ramping up. shery: we are seeing the pboc is trying to balance liquidity, providing liquidity. also at the same time, trying to avoid fueling asset bubbles. we have this top official coming out and saying, it is time to ease. we are talking about the china

banking regulatory official saying china's requirement for the reserves the bank must hold theyuote very high, and should be reduced at an appropriate time. to 17% but hasut not moved since february. that is after four cuts last year. economists saying it will get not untilto 16.5%, the fourth quarter of next year. check of theget a first word news. president elect donald trump has accused the obama administration of putting obstacles in the way of his transition. he tweeted the run-up is being hobbled by unspecified inflammatory statements and roadblocks. his comments, as tension between his team and the white house goes, culminating in the white

house abstaining in a you and security vote. and relations between the u.s. and israel are increasingly sour. john kerry says the chance of peace in the middle east is under threat as israel continues to build settlements in the occupied west bank. says minister netanyahu the focus on settlements is misguided. >> the two state solution is the only way to achieve a just and lasting peace between israelis and palestinians. it is the only way to ensure israel's future as a jewish and democratic state. living in peace and security with its neighbors. >> israelis do not need to be lectured about the importance of peace by foreign leaders. hand has been extended

in peace to its neighbors from day one, it's very first day. we pray for peace. we work for it every day. cut itssouth korea has outlook for 2017. the government expects expansion of 2.6%. loose fiscalain policies. state run companies will be pressured to boost sentiment. korea struggling with record high youth unemployment. long-running focus on hybrids in europe is paying off. toyota is on track for a near sales of gasnnual electric vehicles. toyota had about 4% of the european car market this year.

global news, 24 hours a day, powered by 2600 journalists and analysts. turn to oil now, which is retreating from a 17 month high. i want to bring in our energy reporter in hong kong. tell us what is going on here. oil has been on a winning streak these last few weeks. >> oil was up, the longest run in seven years. stockpiles, have put the market back into focus. of 4.2showed a gain million barrels. decline is shown in the government data, we could see prices under pressure. at the moment now, we've got the forecast for an actual decline

in the stock price. it is something the market recognizes. yvonne: we've got breaking news out of tokyo. stopped trading. roslyn: right now, we see it is falling. now down about ¥30. following on yesterdays drop, which was the most on record. down by 20%. longest since 1974, the time for which we have available data. reporting the main bank discussed financial support.

they had lowered credit ratings for toshiba. related to toshiba saying it may need several billion dollars, the westinghouse , projects which are years behind schedule and billions of dollars over budget. again, toshiba falling. down by about 40 and so far. thank you. let's get back to the oil markets. talking about all the euphoria we do see in the oil markets. 2017, what are you going to be focused on? opec, that will be focus initially. looking through the first six months of the year. we are hearing the right noises from iraq and venezuela.

they are making the right noises at the moment. the year, into february, when we will see the actual numbers or what sort of measures. on opec.arely how the u.s. response, we saw the industry data. whether that provides an opportunity for production to increase. opec and the u.s. will be the key focus. thank you so much for joining us. : loses out to gas. offer ald trump may change of locus. focus. ♪

asia." this is "daybreak

betty: a quick check of the headlines. sprint says it is committed to bringing jobs back to america. donald trump managing the plan. is company now saying it aiming to create the return of 5000 jobs by the end of next year. it is still determining where they are going to be. softbank boss for the scheme. mr. trump: we have a combination of sprint, 5000 jobs, coming from all over the world. also, 3000 jobs, a new company. terrific guy. i really appreciate it. yvonne: the president of japan's willst advertising agency

quit, taking responsibility for the suicide of an 42 work excessive hours. -- of an employee to excessive work hours. exxon mobil has made a new natural gas fight in papua new guinea. they found gas in the north highlands. although besides the deposit has not been determined. the deal has been put on hold ahead of a shareholder vote. check of theck currency markets. the dollar rose to its highest level of the week. we are seeing a little bit of consolidation in the dollar. 116.87.

the euro a little bit of upside. and qe, rebounding from seven-month lows. kiwi, rebounding from seven-month lows. let's talk more about this. joining us from singapore is our guest, live from singapore. good to have you. king dollar.ut we have seen it reached a new high. let's show the were is how much we are seeing in terms of the upside. 23 of the 36 trading days, it has arisen cents trump won the election. does -- is it time to sound some caution now? >> there is no doubt there is a consensus the dollar is heading higher.

certainly in these illiquid markets at the end of the year, there is a potential for volatility. there are very good reasons many investors are bullish on the u.s. d at this point. is likely to extend into 2017. the risk is we might see more rapid dollar appreciation. then many the market anticipate. the reason the risks are weighted on this side is we are going to see a shift in terms of market focus toward politics. we are shifting away from focusing on central banks. ofwe enter this era politics, with a fiscal push in the u.s., likely reductions in terms of regulation under the trump administration, these are probably going to be favorable for the u.s. economy. it has been supportive for asset prices so far.

the risk is in this environment with this late stage fiscal thrust, late in the economic cycle, we may have to see more fed tightening. that adds up to a supportive environment for the dollar. yvonne: you talk about politics, policy divergence. everyone else going the other way. you think these renewed expectations have gone a little too far? they were forecasting four hikes and we only got one. uncertaintya lot of as to the impact, the lasting impact of these potential changes in u.s. policy we are going to see. certainly a we are going to have to wait and see how that plays out. i think the fed is going to be relatively measured in its assessment as it waits to see how this is playing out. the reality remains, many other

countries just aren't prepared to participate in terms of these rises we are seeing in u.s. yields. i think that whitening -- wid ening is going to exert upward pressure on the dollar. list of countries is pretty small. you are effectively talking about new zealand. yvonne: -- betty: i want to talk about another currency. the pound. i want to throw up the chart here for our viewers, show just how terrible the year has been for the currency. the lowest annual average since 1985, particularly after brexit. it is going to be another bleak year for the pound? when does that turn around for

the currency? i am not sure it is going to be as bleak a year as was the case this year. i think the risks are weighted to the downside. see mores we start to economic bite from the brexit may herald the next leg lower in terms of the pound. what is difficult is timing this impact. the fallout on the economy has probably been a bit less severe than many investors anticipated. point that we see more evidence of pass-through, i am not sure that will be among my top trades. when i look at the politics across europe as a whole, i think the politics is probably a more pressing issue for europe itself at this point.

certainly in the wake of terror attacks, that is going to continue to focus market attention on this issue. it is not going to go away. is going tohe euro go below parity versus the dollar. betty: thank you so much. the head of g 10 fx strategy at citigroup. investors welcoming a report saying i hand maker may be going on sale. handbag maker may be going on sale.

this is "daybreak asia." ended u.s. markets lower by the luxury handbag market was an exception.

>> looking for suitors. reports say it is already in contact with an investment inc., looking at several potential suitors. i want you to jump into the bloomberg because i want to show you how big a jump we saw. line upittle, yellow 23%. the most in more than five years. tension foren consolidation in the industry. investors have been eager for something to happen. one investor group in particular who actually bought into kay spade is harris investors. they piled on the pressure, saying they think it should be doing what it is doing now.

we strongly suggest the board consider this option as public investors have all but given up ade story.e sp also claiming they could have hit profit targets comparable to its peers. now kate is going shopping for buyers. is the timing right for a sale? >> it is well-known that there are four possible suitors. one is coach. another is michael kors. pop in trading. also, the parent committee of calvin klein and the parent company of timberland. analysts are honing in on coach, saying it could be a suitor, and it could fetch $21-20 three dollars a share.

there arell buys and no cells. >> up next, what is on the horizon. as the financial sector looks to the industry to deliver profits. ♪

is 8:30 in singapore. gloomy day in the lion city. betty: i am betty liu. you are watching "daybreak asia." let's look at the first word news. plunge continues for a third day with the company in danger of wiping out all its games for 2016. but news was up 80%, down inht down -- write

its u.s. unit has hurt stock prices. the bank of japan has released comments and opinions from its most recent meeting. they relate to the discussion before christmas. one member admitting the inflation target remains a long way off. another member says japan is at a critical juncture. another member is more inimistic, saying a rise private consumption is evident. over to china. the country is downplaying growth targets. they declined to set a trade growth target, saying beijing is less success of about fixed goals. bloomberg has been told the president says he will except growth below 6.5% if holding to that carries too much risk. the stock belongs at

90, citing several threats an overdependence on gaming to make money. nvidia has been the best performer on the nasdaq 100, gaining more than 200%. powered by 2600 journalists and analysts. time to see how the asian markets are shaping up. we are watching toshiba. here is david ingles. david: we are obviously winding as you16, a quiet and would expect, volumes are thin. of trading for these two markets. you look at the futures, chances

are we are going to get declines in southeast asia. one group of stocks i am watching closely, we will talk about jakarta and some of the other movers, or the mining stocks. that means it is quite a rally we are seeing. just to take you through a few of these names. 4%, 5%, 6% gains. these are closely correlated with the price of gold. are cominge, yields down. some money coming back into the bond space. , 251.0 year that is what you get as far as

the spreads are concerned. we are looking at toshiba and also the airbag maker to contact. the daily limit on the back of wallreport out of the street journal, close to reaching a settlement. to hopefullyng have a settlement before that and of the year. we are looking at close to one billion u.s. dollars. toshiba very much in the mix. 264 right now. we started out at 249. roughly at $9 billion. it has wiped out about half of its value. i think we are down for seven straight days. it was among the top three performers on the nikkei. what a change of fortune. economic data keeps pouring in.

to discusso joins us what we have learned over the last couple of days. pending home sales data was released overnight -- why is that? >> it was a really strong drop and unexpected. what we are looking at is a combination of slightly higher mortgage rates after donald trump's election and a real pullback in inventories. what is interesting is the run up in mortgage rates. it is something we should continue to be worried about going into 2017. what we have seen is after the fed hiked rates, the run-up we saw was exacerbated. we have seen a sharper increase sense then. mortgages are more expensive for consumers. againstd, it is working

this trend toward consumer confidence. it could be offset either those factors. something to keep in mind. rtainly a note of caution. what about other economic numbers? jeanna: consumer confidence is one thing to keep your eye on. we got data from the conference board. it was overwhelmingly positive, the highest level since 2001. that is certainly good news. for consumerood spending and other indicators. another thing is what happens with the job market. friday, we should get the final print for 2016. that will both round out president obama's legacy and give an indication where we are headed next year.

one number i think is important is the participation rate. i cover the federal reserve. of the officials really care about what happens with that number. they want to see whether it declines like last month or re-stabilizes. that would be a signal we can put more slack into the market. those are the numbers to watch into the final days of the year. is there a caveat on those numbers because it represents the end of obama's term? president who is going to be inaugurated. jeanna: i think if you are the federal reserve or their colleagues, any data we cfius has to be taken with a huge grain of salt. we know fiscal policy is going to look different in 2017. donald trump is promising big

infrastructure spending but he has also pledged to have trade policies that could become contractor he. -- contractory. absolutely. of technology and finance draw closer, we asked bloomberg intelligence what to in 2017. in syntax we have seen a wealth of user days. there has been investment in the sector in years.

likely will market consolidate further in the coming years. $5 billion in the first months of 2016. investments, we continue to focus on areas of online money transfers and repayments. expect regional banks and internet companies to do more research on applications. s --bishi, alibaba, and t development will be spent on three key areas. how to improve distribution and indicate clients more. they are already offering

wearable technology to clients. the same concept is being applied to car insurance. it is a convergence of insurance companies and tech copies joining hands, such as alibaba. using data and innovation power to come up with new projects and innovation. yvonne: coming, u.s. power willator synergy says coal regain market share under president trump. this is bloomberg. ♪

betty: this is "daybreak asia." yvonne: a quick check of the headlines. the owner of the kfc, pizza hut,

and taco bell chains continues to sell franchises. has yum brands seeking to offload franchises in turkey. they plan to increase franchise ownership to 98% globally. a chinese lodges sticks firm tos they must cut costs exceed rival fedex. the company says they may buy cargo planes to expand overseas. they raised $1.4 billion in its ipo this year, the first chinese package delivery to list in the u.s.. service -- sayeo toy are in the business

raise money. it is sometimes described as china's netflix. trade should resume within 10 days. coal as theops biggest fuel in u.s. electric plants in 2016, the first time this has happened for an entire year. however -- >> more coal is good for us. as power prices rise and natural gas prices tend to go up, coal plants become more profitable. having that nice balance between a gas portfolio and coal is a good balance. betty: you would think more supply means lower prices. i have a chart which shows prices have declined since the trump presidency.

the largest unregulated power grid in the country. the blue line is natural gas. the other two prices are forward prices. how is a good for you? >> i don't think you will see new coal plants being built. thes more about utilizing capacity there. hisesident elect trump, message has been about having fair competition. if we eliminate subsidies for different types of generation and become more technology neutral, i think that will be very good for coal. those coal miners will need to go back to work to extract coal. see more coal and less of something else. if you have a situation where

you are getting more demand for coal if you have a situation whe you are getting more demand-basl have less from the natural gas assets. you would see other types of plants shutting down. most onis probably the economic generation, and if it is not subsidized, it would tend to go away. >> you brought up nuclear. we have seen states subsidize nuclear plants. trump has said he wants to find a way to save power plants. it doesn't make me think they are going to come off line. >> it has had a lot of political support in many states, new york and illinois in particular. message stays with his in terms of creating a level playing field for trade. he should do the same thing for power. it would be a great message for power, if we want to have freein types of carbon

type generation, we don't have a national -- we need to have a national policy. let's not do it state-by-state. not the most economic plants will be the ones running. if we have a national policy that takes subsidies out of the equation, you are going to naturally see the cheapest power to the customer and that is not going to be nuclear. >> trump is pro-fossil fuel. the risk is more natural gas could come online. good point.hat is a something that could happen. we have seen that happen in the past, the gas producing company's doing that quite quickly. of havinge importance a balanced portfolio. we have natural gas plants where gas reserves are. there have been times in the

past couple of months, we have been buying it at any five cents .35 or $.40. the other forms of generation will be more difficult for them. it will be more difficult for coal, nuclear, and anything else trying to compete. dynegy ceo speaking to us. a quick check of the commodities market. oil has been at huge focus. crude, up a few tenths of a percent. yvonne: up next, some of asia's

key economies experienced turbulent times. this is bloomberg. ♪

this is "daybreak asia." yvonne: time for a look at what is coming up. at what he isng

suggesting, binary outcomes for 2017. looking at quality, value, and growth. what is going to happen with the window dressing? beingsee the 20,000 level even more elusive as people get out of equities? also coming up, stephen schwartz. how trade is going to hit these emerging economies here, looking at that. also suggesting an uplift when it comes to global economic growth. last but not least in tokyo, softbank. claim we ares going to have 5000 jobs go back to the u.s. because of sprint. softbank own sprint there. sort of things that flavor what is going on in the next couple of hours.

the united states and europe seem to be in the spotlight. donald trump and frexit dominating the headlines. but here in asia, we have not necessarily enjoyed a smooth ride. good to see you. let's start off with china, a the leader. >> he had a great year. theonsolidated power at party meeting in october. he was named to the core of the party. he has the full support of everyone going into 2017. the economy did well. they maintained growth at the level they wanted. given the run we have seen in japan, the markets, does that reflect well on shinzo abe? >> he is doing well. his popularity is very high. y ride.an easy

tpp andwin scuttle the raised questions about the u.s. japan alliance and how much trump will support that. that is his big challenge in 2017. yvonne: speaking about challenges, you have the south korean president. what will be her major, aside from what we have seen in 2016, the biggest challenge? >> she is just looking to stay out of jail right now. she has been impeached and suspended. the prime minister has taken over her official duties. there is a chance she could stay courtthe constitutional rejects its motion. even then, she has only got a year left in her single term and then you have elections. it is a matter of timing.

south korea will see new leadership soon. in india, nobody has been such a large figure in indian politics quite like modi. what can you expect for 2017? 86%is move to eliminate of india's hard currency, that is a large role of the dice. the ramifications will be playing out into next year. how does the rural population cope with that? on hisll weigh popularity. he has the biggest state election. this is seen as a bellwether to the 2019 election. nextgot a lot going on year and he's got to get these things right if they want

another five-year term. on the leaders we saw in asia and their biggest challenges. in the meantime, sony's robot dogs were never the main success they have helped for -- hoped for, but a determined few are determined to keep them alive. this is one of the 150,000 or so sony sold. they had just made it to middle age in dog years before the division was killed off. later, theydecade still provide comfort to devoted followers. i think my love is much greater then when i first met him. he runs to me when he finds me and starts dancing.

sony engineerrmer provides a lifeline. >> we were first asked to fix them when an elderly man said he wanted to bring his to the nursing home. when we are asked, we will do what it takes. rosalind: the demand is so great, his team of seven engineers cannot work fast enough. he is hiring more engineers. impact, he is trying another business idea. bringing them into elderly homes to offer therapy. >> when i say something, it responds. it is a very special feeling. it makes me feel happy. i have never seen anything like this before. i kind of like this. hope you communicate

with the world around you. i think this is the most important factor of robot therapy. although japan pioneered robot therapy 15 years ago, the spread has been slow. it could be a step to helping old dogs learn new tricks and bring happiness. betty: the elderly and kids around the world. bloomberg markets asia is next. we are counting down to several more openings. itnne: seeing a retreat when comes to stocks with the exception of new zealand. japan really falling down, 0.8%. rishaad has more. this is bloombg.

david: what propelled do to pick google is the company you wanted to go to? who cares about a search engine? >> i do not think google was going to be that successful. >> is an awkward when you are dealing with the founders? --id: it seems the travelers a driverless car phenomenon is on its way. >> more than 32,000 people scheduled to die this year. david: have you resolved the issues with europe? >> would you fix your time, pleas