♪ the pound takes a hammering on reports theresa may is aiming for a so-called hard brexit. president-elect will trump shakes the foundation of transatlantic relations, dismissing the eu and calling nato obsolete. lineng takes a tough saying the one china policy is not possible. and korean prosecutors say they will decide whether to issue an

arrest warrant for j wiley. is daybreak asia. it's just after 6 p.m. in new york. after 7and it's just a.m. in hong kong. looks to be a busy week for all of us. we are looking ahead to the inauguration day of donald trump. his speech will probably be entertaining judging by what we saw in the press conference last week. in the u.k., with theresa may's feature on tuesday, we see moves on the pound. lows but still hovering around 120 against the dollar. there's not going to be nothing to talk about at davos. there will be lots to talk about when economist and thought leaders. it feels like there are hotspots growing all around the world, whether in taiwan or here in the u.s. or in the u.k.. the pound has been the one

currency to watch over the weekend, what's going on in asia right now? yvonne: one thing to wrapup is china gdp. that's of data coming through. lets the out things are kicking off in the asia-pacific. a strong session on wall street on friday. the new zealand index up with the kiwi pretty flat that we see dollar strength in the asia-pacific this morning. let's look at australia. we talk about the commodities on friday and we saw that minors, that should give enough support for the australian dollar. we're close to breaking that 75 handle against the dollar. aussie dollar -- aussie job numbers also out and japan expecting producer prices and machine outfitters out later on this hour and we expect to hear more from the prime minister, arriving in the it to wrap up

his asian tour. below the 115 handle for the yen. region.ook at the u.s. markets are closed on monday for the martin luther king holiday, so forow, we have to talk about the pound. ball: we saw the pound through the 120 level, raising some alarms as we see the pound losing ground since the u.k. voted to exit the eu. seems like it's going to be more of a reality. theresa may will outline the hard brexit plan to basically quit the eu. su keenan has more on that move. : below 120 for the first time since the fall and it has come arethat since but reports really ramping up speculation that the u.k. prime minister, theresa may, will signal plans to quit the european single mark it to gain control of britain

supporters and laws and it keeps mentioning a hard brexit -- a clean break, no baby steps, just break and the currency has fallen some 19% since the june referendum, but declines have picked up because of the concerns about this clean break. you look at what some of the government officials reportedly told the sunday times, it is that they can see more volatility. let's go into the bloomberg. this is should see is money being pulled out of european stocks through an etf. it has really picked up in recent days and that has a lot to do with some of this speculation here. betty: let's go back into the u.s. and earnings coming out soon. we will have a anchor earnings coming out. tell us what to expect there. morgan stanley and

goldman sachs reporting. it has been a bumpy ride for the financial firms except in the final quarter. you can see stocks really taking you are going to see it in the fourth quarter revenue. a lot of analysts say that compared to first quarter and a a goodo, it is comparison. that's helped by tough comparison to a year ago. goldman sachs revenue expected to rise 7%. analysts see a strong , but gainster report from investing and lending may be volatile. the trading week will be overshadowed by events in washington with the inauguration. we did not hear much about economic plans fom donald trump

during his press conference but what can we expect? su: you can expect the unexpected. the obama family will be leaving office on friday. a lot of talk of a have been packing up and final farewells have been said. trump taking over on friday, there will be a swearing-in and there were reversals on the plaza and during the week leading up to that, and will be a lot of focus on the gathering in davos, they will likely focus on the event on friday. yvonne: let's get to the first word news with heidi. heidi: the outgoing director of the cia has called donald trump's comment about the u.s. intelligence community outrageous. john brennan suggested the president-elect does not have a full understanding of russia's capabilities and intentions. the comments come amid escalating intent -- escalating

tensions following a series of insults and allegations by trump in recent weeks. republican senator rand paul is developing his own alternative to obamacare. he said his legislation would include a provision for inexpensive insurance policies with more restrictive coverage. he said the current requirement to cover a number of procedures drives up costs. all trump has promised to repeal obamacare without outlining an alternative. korean prosecutors have delayed a decision on whether to seek an arrest moore andfor the samsung airman. investigators questioned him for 22 hours last week, saying he was a suspect in their bribery investigation. prosecutors say they will make a decision by early monday afternoon. the heads of south korean conglomerates were questioned on whether they were pressured to give to foundations controlled by present confident. global news 24 hours a day powered by our 2600 journalists and analysts in more than 120

countries. this is bloomberg. beijing has warned trump not to question it ties with taiwan, saying the one china policy is not negotiable. this comes one day after the president-elect hinted at a reset for u.s.-china relations. we see another exchange of words between china and trump. guest: we have indeed and it keeps coming. wallfollows on from this street journal interview where he seemed to suggest he was considering a complete upending of u.s.-china ties focused on this one china principle which basically acknowledges china and taiwan are part of the same country is the two sides disagree on what it means. trump says he was not going to commit to one china until he sees progress from beijing on

trade and its currency. the foreign ministry in beijing was quick to follow up over the weekend. their spokesperson has said the one china principle was nonnegotiable and was an essential policy foundation for u.s.-china relations and that urging trump to acknowledge the sensitivity around the taiwan question. state media being slightly more trump was, saying playing with fire on the question of taiwan. what are the other main areas of contention between trump in china? guest: clearly, trade is at the top of the list. we know he talked of sanctions or putting tariffs on chinese imports and that has many in china concerned. we have also seen geopolitical tensions with rex tillerson

saying china should be blocked from the south china sea island. that was met with a lot of anger here in beijing, with state media saying those comments were foolish and that unless washington wanted a large scale war, there's the question of north korea, trump saying he wants to see more done to rein in pyongyang us nuclear ambitions and that he wants to label china a currency manipulator. to walk back on that, saying he would not make that move on the first day of his presidency. betty: certainly a lot on deck between the u.s. and china. vietnam is still holding out hope the transpacific partnership is going to come together even though donald trump has vowed to withdraw from it on his first day in office. the trade deal would be a major boost to vietnam's economy.

>> message i see is i belie the new administration of the united states would reconsider its perspective on tpp and try to achieve a new generation agreement that will benefit all parties concerned. i see the newly appointed members of the new cabinet are tpp, so they might consider their decision. betty: our southeast asia correspondent spoke to us just a while ago. why is there optimism tpp could still go ahead? optimism because those set to take senior positions suggest there is hope yet that tpp is not dead. rex tillerson said recently he was not opposed to tpp even that

he shares some of trump's concerns and he is not alone. what is also driving optimism is a commitment from the other 11 member nations. minister is prime also a strong advocate and even if the tpp gets killed, there is a plan b. without tpp, vietnam will continue to move forward areuse in addition, there three currently under i think thisso will help our economy continues to be propelled forward. tpp is important because it is needed for countries like the and him to reform things like labor practices.

has he announcements over claims in the south china sea as well, any development ahead of trump's inauguration? both countries issued a statement over the weekend and pledged stability in the south china sea to avoid any action that would escalate tensions will stop the chief met with the countries president and agreed to work for a basic solution both sides can accept. later on we will hear from alex elusive interview from their minister. betty: and just ahead we will look at the economic data due out this week with china high on the radar. this is bloomberg. ♪

betty: this is daybreak asia yvonne:. i'm betty u in new york. yvonne qck check of the the/headlines. writing global uncertainty is putting pressure on prices and as theorce has been cut company and its rivals continue to slash costs and invest more heavily in cloud computing. that's on a reduced growth outlook. the ceo remains upbeat. >> we have had significant large events and i'm confident that as from ramped up, the rescue the working days and furloughs will not be there anymore and so we are confident about q4. betty: a chinese property

developer is looking to diversify beyond real estate. the developer is taking a bet on three tech companies. the chairman says the company sees real estate growth stagnating from 2026 onward. yvonne: and we will watch nintendo when trading kicks off in tokyo. with atch disappointed higher-than-expected price tag of $300. let's take a look out to expect from this week's ecomic data let's start here in the u.s. .ith inflation numbers

some economists are saying we may see more surprises to the upside that may force the fed to raise rates even further or even more than what is expected. guest: the dollar in the u.s. has been quite positive lately at that has continued into the new year, which is great to see. i think has given a lot of investors the confidence that although markets have rallied, there is the fundamental backdrop that is going to drive markets even higher in 2017 because you have an improving economy in the u.s. two or threell get rate hikes from the fed this year and that would be consistent with an improving outlook but one where the fed needs to be more cautious than normal. you do have an inflationary

backdrop that's not rising by as much as it was the past. betty: some economists point to some possible warning signs. if our viewers can look inside the bloomberg terminal, if you look at retail sales, retail autos haveu exclude been driving retail sales in the u.s. take that out in retail sales of only grown about .2%. a possibility in some sectors of the economy that it does not -- does not look quite as great? that has been something we have been tracking over the past six to 12 months. resale group may not

be a strong is the headline numbers suggest and you might see that in the next few months because petrol prices are starting to increase. think the overall story in consumer spending is one where it is growing ok but definitely not falling off a cliff. that is important for the federal reserve. they want to see the momentum is generally growing at ok levels, but not one you would expect when consumer spending was rising at a much higher rate. closer to home, we are watching china gdp. it seems like the mantra for china has been stability in exchange reforms right now because the credit data we saw new loans and refinancing still for the robust and we continue to see the disconnect between

what the government is pledging when it comes to deleveraging and actual data. could this signal the growth we could see could be slower than we are anticipating? some of the anecdotes are it will probably be the story in a years time or even a bit longer. the general anecdotes are that the chinese government is implementing fiscal and monetary and they wills continue into 2017 as well. we are likely to still see growth at 6.5% and we think about the december numbers due out this week will show chinese growth at 6.7%. i think that will give investors lot of confidence.

especially where investors in the market were concerned about what's happening in the chinese economy. yvonne: what about for capital out close? $1.2 trillion estimated to have left the country since the devaluation. the reserves approaching a worrying level and can china keep burning through their reserves? guest: there's probably a little more downside that could come that would think pull us out of the market uncertainty because you have this fundamental economic act drop. at 6.5% is still a great outcome. you may see some further

outflows but i don't think it will cause the same directions that it did in 2016. when of the key risks for emerging markets broadly is the u.s. dollar strength will cause strength for u.s. denominated debt. yvonne: great to have you with us will stop up next, decision day live in seoul on whether ancial prosecutors will seek arrest warrant for the former sansone .

betty: south korean prosecutors are set to announce whether they for issue an arrest warrant j wiley. he's a suspect in south korea's influence scandal.

let's get the latest from our euro chief. what might be causing this delay? the prosecutor said it was complex. they did not give a reason other than it was complex. folks who have been observing this believe they are trying to get all their ducks in a row because they have to argue the him with theing court judge. what they don't want to happen is what happened with the chairman's bribery charges. the court judge said there was not enough evidence to do so and they rejected the arrest warrant in that case. what are the chances prosecutors will request an arrest warrant and once they do, what happens and what are the charges. most observers believe

prosecutors will seek an arrest warrant. the court judge will review it and they're still a chance the court judge can reject it and that's why many believe special prosecutors are taking their time to make sure everything is in place so they can make a successful argument for the arrest warrant. once that is done, the judge is a few days to review it. the specialct it, prosecutor may consider an indictment without an arrest, which means they could face a trial without being arrested. yvonne: on a related but separate note, samsung is announcing the cause of the note seven fire. do they know what the cause is? guest: it was in a newspaper here reporting that they may on monday,e results

january 23. the cause could be a battery design flaw as well as a software flaw. betty: much more with the xfinity tv app, anything with a screen is a tv. stream 130 live channels, plus 40,000 on demand tv shows and movies, all on the go. you can even download from your x1 dvr and watch it offline. only xfinity gives you more to stream to any screen. download the xfinity tv app today. i've spent my life planting a size-six, non-slip shoe into that door. on this side, i want my customers to relax and enjoy themselves. but these days it's phones before forks. they want wifi out here. but behind that door, i need a private connection for my business.

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a pretty chilly hong kong out there. 30 minutes away from betty: the first major market open. is 6:30 send the evening here in new york where markets are closed in anticipation of a long weekend. it's going to be a very busy week. davos is meeting and lots of economic numbers on tap here in the u.s. yvonne: you are watching daybreak asia. heidi: china has urged donald

trump to recognize the high sensitivity with regard to taiwan and set its e china policy is not to go shall. trump told walltreejourna he would only commit to the policy after assessing the project on currency issues, the president-elect has not said call china a to currency manipulator immediately. holdings company seeking to expand its assets by buying a group for five and $5 million. ahead byected to go mid-may. it's the latest attempt to bolster his australian business which suffered a setback last year when he moved to buy a majority stake and was blocked by the us trillion government. the creation of a palestinian state remains the only acceptable solution to the israeli-palestinian conflict according to an international conference. the statement reaffirmed the

1967 borders would be the basis for any agreement. 75 nations and organizations gathered in paris to try to revive the peace process. didisraeli prime minister not attend. spacex returned to the skies on saturday by launching a communication satellite into orbit. a fires first since destroyed its rocket and payload on a launch pad in september. the rocket touchdown on an unmanned drone ship offshore. spacex hopes to launch 2224 rockets after just eight missions in 2016. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. to bring innt kathleen hays for more. as the week it's underway, it

looks like theresa may's hard brexit could eclipse the whole donald trump inauguration maybe. kathleen: at least for a day. we are hearkening to these u.k. sunday times report that theresa may is paired to take the hard brexit road because she is ready ofdrop trade that is free tariffs to get new powers like the ability to curb immigration and make new commercial deals for the u.k. su keenan talking about this earlier -- it's putting the fire under an equation that has already been rising. can see the white line -- u.k. inflation has definitely gone up over the last part of the year with the brexit and the pound. but look at the blueline. that's u.k. input prices, writing their fastest pace since

2011. as the head of the bank of england gets ready to give his first speech of theea on monday, he's going to be thinking what do i tell them about inflation? in, stillted to come far away from their 2% target but the balancing act is getting trickier. he's trying to figure out what kind of trade deals will we or won't we get? that's making the job harder and a little more complicated. betty: markets seem to be rethinking the trump affect. kathleen: really picking up steam after friday. trump's first 100 days will be critical to the economic output. how fast will the move ahead? bloomberg intelligence points out that last week, trump missed

a chance to impress the markets at the press conference because he did not talk about these things. all other topics were on the table. you'll have a focus on fed speak and we have janet yellen and others, but i want to look at the retail sales report because it was a big disappointment. was 0.6.ine number but take out car sales and you did not get much move at all. knowis the question and we we have consumer confidence at a 13 year high, so the all are wondering may be a lot of action. this is going to put lot more focus on the fed speakers this week. hey have to think about all these things on the landscape now. the fed's be all about trump? kathleen: there is a certain amount of hope that everyone

from janet yellen to build deadly we'll talk about what have you see now? you have talked about how it could affect your forecast? what are you going to do about it now? three first-time voters speak again. we have neil cash kari and rob kaplan from dallas. tradersle thing of bond rethinking the trump reflation bet, we've seen a big turnabout in heavy trading. not's the line of price, the yield. look how the volume has been spiking under this renewed buying of bonds. is a very busy week -- the ecb meets on thursday. there's a lot of handwringing over inflation with mario draghi and his colleagues expected to hold study on policy for now. bank of kuroda from the japan will be speaking to branch managers.

people will be looking to see what he might say about bonds. on friday.gdp this is an important number for traders around the world. betty: we have some breaking news right now -- this is the company that owns the retail chains of lenscrafters and a chainsses hut retail according to the financial times, citing people familiar with the matter, we are learning this deal would see the founder coming -- becoming the largest single shareholder with about a 30% stunt -- 30% stake. to the sp,ording agreeing to a 50 billion euro merger. we will watch those lines coming out of it deal. ciaoutgoing director of the

has hit back at donald trump over his criticism of the u.s. intelligence community, not have atrump does full understanding of moscow's intentions. let's bring in a ramy inocencio. what more did he have to say? out threee words came forcefully and the last few days on the cia director's term in office. recent comments mr. trump made outrageous and he does not have an understanding of russia postural intentions. on a more personal basis, he said to mr. trump it's not so much about you, it's about the united states as well as national security. first, to the comment about being outrageous. he said what i do find outrageous is equating the intelligence community with nazi germany. you will remember four days ago,

buzzfeed broke some news about unverified reports and mr. trump said those intel agencies should not hold -- have allowed this fake news to leak into the public domain, are we living in not to germany. at. brennan replied i take gre umbrage at that and there is no basis for mr. trump to point fiers. he pointed out a lot of this was already circulating in the intelligence agency realm and that it was already public to some degree. say on one early morning talk show. >> if he does not have intelligence the community, what signal does that send to our partners and allies as well as our adversaries? mr. trump has to be disciplined in terms of what he says publicly. he will be in a few days time, the most powerful person in the world. one thing mr. brennan did say is that he does support mr.

trump's administration and he said he has no interest in undermining the president-elect certainly some: forceful words. we did get more clarity from trump on his policy towards europe and it fell sticking with this campaign promises of a rattling relations between the two. out: this information came in just the last few hours and it does put him at odds with angela merkel. not only with angela merkel but the european union. -- he isling nato calling nato obsolete and praising the united kingdom for its brexit. it is pretty that she's pretty thing eu members would follow brexit and he's going back to auto dealers with bmw, saying they could face and import duty of 35% and saying they should stop building a new plant in mexico. much more ahead on

daybreak asia. more on trump -- talking trump and trade in our exclusive interview with the vietnam prime mister find -- the vietnamese premise or. this is bloomberg. ♪

betty: this is daybreak asia. i'm a dilute. yvonne: vietnam's prime minister is holding out hope donald trump will reconsider his opposition to the transpacific partnership trade deal. asiaoke to our southeast correspondent and says he is a whole the administration will see the benefit of the treaty. >> i have had a meeting with

u.s. business leaders and met with secretary kerry of the united states and the message i see is i believe the new administration of the united rates will reconsider its perspective on the tpp and try to achieve a new generation agreement that will benefit all parties concerned. without the tpp in place, it does not mean all the countries will withdraw themselves from the world stage and reduce cooperation. the remaining members will work together to find a way to thefit everyone, even if tpp is not ratified by the united states. >> donald trump has made it clear he wants to kill tpp.

, do you seehappen member nations gravitating more toward letting it have a greater momentum to fruition? the member countries are engaging in negotiations and i'm sure it will be promoted. when i see the newly appointed members of the cabinet or many the tpp,re in favor of i think they might reconsider their decision. what i like to stress is even tpp, vietnam will continue to move forward. in addition, there are three under negotiation, so i think this will help our economy continue to be propelled forward.

>> there's a sense china's influence and power will increase. is there reason to be concerned about that? it is true that it is a china led initiative. it is fine to participate in such agreements. >> how would you describe the relationship between the it and china? areietnam and china neighbor countries. i think china needs vietnam and vietnam needs china. that was the vietnam

prime minister talking to haslinda ahmed. a quick check of the headlines at this hour -- a chinese billionaire has seen its first revenue drop in over a decade. the slump in the company's property business outweighs growth from its entertainment operation. he's then acquiring a number of assets to diversify from real estate. watching picasso as bids outnumbered shell at friday's close. aey agreed to pay to settle criminal investigation into product false linked to at least 17 deaths stop betty: the martin luther king holiday weekend provided good results for two of hollywood's studios.

fox studio stayed in first place after generating $20 million in sales. " enmonster truck in sen pl -- much more ahead on daybreak asia. hollywood tough. boost abe seeking to regional ties as the japanese prime minister continues his tour of asia. we will look at what's on his agenda in vietnam, next.

betty: we have some breaking news -- just getting economic numbers out of japan with machinery orders and inflation numbers looking like a worse than estimated fall. sophia: they are looking much

deeper in terms of the fall for machine orders. here,own of the numbers -5.1%. i -- it was anticipated on a yearly basis that farm machine -- they rose 10.4%. this is a leading indicator of capital spending and does not include japanese equipment. november is the first monthly drop in two months. spurring domestic demand here, we did see an improvement. it did rise 4.1%.

in september, the cabinet office did revise their assessment to a negative sense saying machine orders were looking more stagnant given the broader picture here. the yen to recall that has weakened about 8% since trump's when and overall, it's going to be something to consider when looking at these numbers. yvonne: let's dig deeper into those figures and what they mean. good to see you here. what do you make of this when it comes to these machine orders? governmentke the forewarned us on the pessimism but what does it mean for demand when it comes to capital goods? we are clearly hoping for

stronger orders already. it was very choppy data with the yearly data of 10%. what we have seen over the last month is companies have brought down there inventories tremendously. machinery orders should be a follower here and i think they are getting much stronger over spring so i would not put a negative invitation on this data. i want to break down some of these numbers -- rising 0.6%. of 1.2seeing a drop percent, so not as dramatic a fall. in the seen a reversal currency's decline and there is concern of the upcoming trump'st, donald

policies could take longer to take affect. if indeed that is the case, how much could this derail the economy which has been pretty choppy of late and it continued to be a passenger on this trump train? that is a very important point. we can't that a lot on the japanese economy. for companies to really make money, it has to focus on trade and overseas investment. the production inflation data gradually getting out of negative territory. about investment. it depends on getting exports going. this is why it is important he's going overseas, taking a lead role. it is about australia and the philippines getting business rolling and is issuing them --

positioning themselves. what do you think is going to be the priority? is it securing tpp? andt more geopolitical recalibrating u.s. and china relationships? right now, it is clearly geopolitical. we don't know how the u.s. is moving and whatchinese -- what china ll makout of that. important point for these midsize nations in asia who are defending so much on trade, with global trade focusing and looking at asia, in in effect all of these relations are getting set for what is coming. he's going to asia and doing , whatever comes

into the situation, where investment becomes possible, japanese companies have been investing in asia but they need reassurance and the same is true to get the environment right. certainly seems that way. i'm wondering if you are surprised given how much trump has hammered china on its currency how quiet he has been about the decline we have seen in the japanese yen which is only helped to boost exports out of japan? i'm curious if you wonder if he's going to start making any comments about that. guest: japan had all the trouble with the exports into the u.s. japan is the major investor. the major investor into the u.s. , so it has the strongest position in asia. china has to weigh what is

coming and is bracing itself and it means japan can move and japan is clearly trying to get the alliance together. that will be very important for china as well. think japan will benefit from rougher relations between japan and china? how it ist depends on playing out. it has wiggle room, but if the u.s. is clashing with china, it means asia would have to support clearly needsit to support the trade war. if the u.s. is aligning with there's aany ways, possibility to get the strategy to together. those numbers a little

bit worse than estimated. asia'sre ahead with first major market open just moments away. yvonne: we will see how tokyo markets react to those

♪ >> british prime minister theresa may expected to take a hard line on brexit, the pound falls to levels not seen since 1985. >> dismissing the eu and calling nato obsolete, shaking the foundations of transatlantic relations. >> the deal is not dead yet, holding out hope that trump will get behind the tpp. willrean prosecutors

decide today whether to issue an arrest warrant for samsung vice-chairman jay y. lee. ofthis is the second hour "daybreak asia". i am in yvonne man in hong kong. >> it is just after 7:00 p.m. in new york. i am betty liu. it will be a jampacked week. we got some numbers on japan, not so great on machine orders. we are waiting for abenomics to take old. that willin the u.s. answer questions about whether the fed will go two or three hikes this year. yvonne: we also have fourth-quarter gdp out of china. we talk about inauguration day, also more from the prime minister theresa may, what a hard brexit might mean. you might close your eyes this

week, a lot going on. in the asia-pacific, david has more from singapore. david: right, close your eyes, go on vacation, come back friday. it is rare on a monday morning you get moves like this. we have been talking about the pound, some dollar strength coming through, the exception against the japanese yen. to a lowright now fell of 1.19, what is behind the drop likely to see a sustainable rally here. interesting note out of ubs, u.s. dollar will peak in the next few months. positions building up on the dollar, start building shorts against the pound, the euro, and the swedish krona or.

the nikkei was supposed to open higher, but machine orders came through, the yen strengthened. as well.of .3%, topix kospi flat at the mont. australia,a look at asx 200 reversing two days of losses. looking at gains right now thanks to this renewed rally a cross commodity prices. gold is back about $1200 an ounce. it will be interesting what is happening here. let's flip the boards and look at these commodities and china. here we go. i will leave this here. again, we will be talking about this a lot. have a look at these names mayss these contracts,

contracts on the chinese mainland exchanges. else, so so, and japan is getting hit because of the stronger yen. >> thank you. we were talking about the pound gaining ground after plunging against the dollar on those reports of theresa may seeking a hard brexit plan. right now, the pound just right -- 1.20at one .20 level level. su keenan is here with more. su: we did see the pound tumble along with stock futures, which indicates theresa may will signal a hard or clean break with the eu. currency has fallen against the dollar since the june

referendum, but the declines by speculationed of a hard brexit. analysts say there will be punchy brexit talk, and this could bring more volatility. at how these stocks have been pulled out of the european etf's. shows are a lot of investors are taking cash out of 's, perhaps getting that couldhis speech see the pound testing flash crash lows. >> bank earnings will be in focus this week. su: yes. we saw a few late last week. we kickoff on tuesday. stanley, the question will be willow bay benefit from the rebound and trading revenues

as they have shifted to stable sources. 51% versust for eps 21% pure growth. meanwhile could rise 7%. analysts view this as a bellwether for financial firms. it is seen to have a fourth quarter report. if you look at the full-year chart for goldman sachs, like the rest of the financial community, its stock took off in the fourth quarter since the election of donald trump. could the inauguration overshadow all of this? yes, it will be an interesting countdown. expect the unexpected is what observers say. obama and his family will be departing this week. there has been a farewell

speech, remarks to the press. they will be leaving the white house on friday, and today, we saw some of the dress rehearsals with the stand ins for donald trump and his family taking place for the inauguration on friday. what may also be competing for headlines is events out of davos. it is quite likely that the big topic will be the new u.s. head of state, how that will impact the economy going forward. on our plate this week. su keenan, thank you let's get to first word news with haidi lun. ka-shing seeking to expand energy assets by buying australia's duet group for $5.5 billion. shares looking like this, popping 5%.

subject to regulatory approval, but expected to go ahead. it is the latest attempt to bolster its all strain business when it suffered a setback last year. korean prosecutors have delayed a decision on whether to seek an arrest warrant for samsung vice-chairman jay y. lee. 22 hours, afor suspect in the bribery investigation. prosecutors will make a decision by monday afternoon. heads of south korean conglomerates have been question about whether they were pressured to give money to a foundation control by the friend of the president. china has urged donald trump to recognize the high sensitivity with regards to taiwan and said it's one china policy is nonnegotiable.

however, the president-elect said he is not prepared to declare china a currency manipulator immediately upon being sworn in this friday. luxottica and one other company have agreed to a merger. luxottica is the world's lightest eyewear maker. essilor shares closing like this in the friday session. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. tpp willg out hope the come together, even though donald trump has vowed to withdraw from it on his first day in office. the trade deal would be a major boost to the vietnamese economy. >> e message that i see is that i believe the new

administration of the united states will reconsider its perspective on the tpp, and it will also try to achieve a new generation agreement that will benefit all parties concerned. i see the newly appointed members of the new cabinet, many of them are in favor of the tpp, so i think they might reconsider that decision. to our southeast asia correspondent, hassan haslinda amin -- has haslinda amin. vietnam is hopeful because of the comments of the trump team. they seem to suggest tpp is not dead. a case in point is wrecked tillerson, secretary of state, he says he is not opposed to tpp, even though he share some of donald trump's concerns, and

that view goes beyond rex tillerson. over the weekend, we had renewed commitment from malcolm turnbull, shinzo abe, also a strong advocate. even if tpp doesn't go through, vietnamese prime minister says it is not a concern. even without the tpp, vietnam will continue to move forward, because in addition to the tpp, others are in place and under negotiation, so th wl help our economy continue to be propelled forward. know, tpp is important as a way for vietnam and other countries to push through reforms which can't be done internally given domestic structural constraints. vietnam has entangled with china over claims in the south

china sea, so what are the developments ahead of donald trump's inauguration on this? haslinda: we had a statement from both countries over the weekend, they have pledged stability and the south china sea and want to avoid any action that will complicate, escalate, the tensions there. the at nouns communist party chief met with the chinese president as they agree to seek long-term solutions. they will discuss transitional solutions that will not affect each other's position on the issue. avoids you know trying to tensions, which reached a peak in 2014 when china placed an oil rig within a stone claimed by vietnam. -- within a zone claimed by vietnam. >> thank you appeared much more ahead. we will hear from one indian financial tech company that has

benefited from prime mr. modi's cash crackdown. from that later on, why one seo is underweight on asian equities. this is bloomberg. ♪

.> this is "daybreak asia" i am betty liu in new york. yvonne: i am yvonne man. down 8.3%,akata giving up the gain on friday after the bids outnumber the cells. payairbag maker agreed to $1 billion to settle a criminal investigation linked to 17 deaths. the settlement should now remove any barriers to the compan

y's sale. >> a developer looking to diversify beyond real estate. taking a $2.2is billion bet on three tech companies affiliated with chinese tech tycoon excellent empire -- leeco empire. >> a fall in nintendo shares, down 2.3%, tumbling falling the release of its latest gaming console, the switch. a higher than expected price tag of $300, making it more expensive than rival devices. they are not convinced it will replicate the success of the wii despite having wireless controls. the pound fell to its lowest

level since october on reports signaleresa may will plans for a hard brexit during a speech on tuesday. of's bring in the founder javelin wealth management from singapore this morning. great to have you. what do you make of this move? it should warn that some of these could be excited traded during the asian trade, but are we seeing the concerns that hard brexit could materialize? we are.i think it is a logical reaction to those fears. all of the press coverage over pointingnd seems to be to the fact that the prime minister in her speech tomorrow will be in for sizing the degree to which the control of immigration is way more important to the british government than access to the single market. if they do cables out of the single -- if the u.k. pulls out

of the single market that will be bad for u.k. business. is forecasting for 1.10 four the pound on the severe brexit outcome. what do you make of that? what does this mean for european equities? perform onntinues to the back of this weakness. can they continue to shun the political risks? has a bige concentration in export-orientated companies, so a weaker pound is good news, and that is why the ftse has been hitting successive highs over the last couple of months, and that will probably continue as a consequence. nonetheless, a forecast of 1.10 is likely. we could be looking at parity by year in if the worst fears are realized. >> we have been talking about at parity for the doll-euro, but

not so much pound as well. that is one to watch. we are looking ahead to the inauguration of donald trump as well. you buy the election, sell the inauguration day, do you see it that way? continue to see upside in the developed markets? we still see a bit of upside in u.s. equities if only because the underlying position of u.s. corporate earnings is looking more positive. the industrial production data last week not only from the u.s., but also europe as well, is actually looking reasonably positive, followed up by reasonably good data out of china, so the fundamentals on a broad brush cross-border bases around the world look reasonably positive, so if president trump does deliver in his first one hundred days on some of these issues which are deemed to be ,orporate friendly, tax cuts

incentives to repatriate offshore assets, reformation of that could bethen extremely positive on the margins, but unfortunately the amount of detail as is so often the case is almost nonexistent, so we are largely left to guesswork. a bit more bearish when it comes to the asia front when it comes to asian stocks. is it more about the trade risks? donald trump said he might push back when it comes to labeling china as a currency manipulator, but the trade risks is to remain. >> that is correct. again, we await the details with ,reat interest, but nonetheless the sensitivity of asian economies, particularly china, to the trade story remains extremely high, so just the uncertainty created for that will be pretty negative and we will probably hold back

investment intentions until we know. in your previous segment, we had a rip percent of from the at phnom who was fairly positive about the tpp, but i still think that is a big call at the moment since u.s. policy seems to be very much against those sort of multi-lateral, cross-border deals. >> would you avoid asia altogether, steve? >> no, i wouldn't. there are pockets of decent value. we still like vietnam, india posts currency re-denomination fiasco, but that will prove a passing trend. the outlook remains positive and we have been taking opportunities to add more to our sitions. >> where doou it has been inter. if you look at onset the moment, yields have been coming back,

which would seem to suggest the bond market is less convinced about the acceleration in growth . it is two different stories at the moment, so we are relatively neutral on bonds. i would expect yields continue to rise in line with fed policy. >> it has been interesting, we have a chart here where it shows you the incredible amount of volume on days when we have had economic data that has caused bond yields to spike. one notably was the last jobs report. we have had incredible spikes in volume in tandem with that. do you read into that that may be that is the bond market catching up with the equity markets here? >> like i said, it is difficult to say. fed futures, the expectations would seem to be something in the region of a 75

basis point increase in rates during 2017, but this has always been the case with the fed in recent years. it is really very data dependent, so that is what we are expecting. if we do get 75 basis points on fed funds over the course of the next 12 months, then yields will go in one direction, which is up. >> up indeed. of chaplainfounder wealth management on the global markets. a war of words, china hitting back a trump, saying it's one china policy is nonnegotiable. we will have those details next, strong words from china. this is bloomberg. ♪

>> beijing has warned trump not -- it's one china

policy is nonnegotiable. tom mackenzie has the details. what is this, another round of sparring between china and trump? tom: it is coming thick and fast, the second time in a month that donald trump has suggested a complete shakeup of u.s.-china relations in regards to the one china principle, a net knowledge meant that china and taiwan are part of the same country. even if the two sides disagree as to what this means. this coming in a wall street journal interview on friday, quoting him as saying that he was not necessarily going to stick to the one china principle until he has assessed to china's progress on trade and its currency. china's foreign ministry coming up quickly over the weekend with its own comments and reaction. the spokesperson saying the one

china principle was a political foundation of the u.s.-china relations with nonnegotiable basis, and urging trump to acknowledge the sensitivity around the taiwan question. state media taking a more robust stance, the china daily saying that trump was playing with fire around the taiwan issue. words, it comes to the we are seeing a tent for tap between u.s. and china, so what are the other areas of contention? therade is near the top of list, at least from trump's perspective, and his suggestion he would impose tariffs on chinese imports, but also geopolitical tensions. we heard last week from rex tillerson, suggesting that he would want to see china blocked from the south china sea islands, causing anger in beijing. korea,stion of north

trump says china should be doing more on that. he did offer an olive branch in terms of the currency. labelinglked back china a currency manipulator on day one. >> thank you. stay with us. ♪

8:30 in singapore. this is the opening of trading there. betty: you are watching daybreak asia. let's get the first look news now with haidi lun. and vietnam have come to a tentative agreement on their overlapping claims the south china's. the two countries have promised to manage maritime differences and safeguard the stability of the area. as the vietnamese

ambassador wrapped of a trip to china. all policies say legislation would can sure provisions for more restrictive coverage. the requirement to cover a number of computers drives up costs. president-elect trump has vowed to repeal obama without outlining a direct replacement. and banks are struggling to do about loans. the president he reported that the finite is very -- finance industry is said to enclose a cash infusion plan this week. this would be announced in the bus it -- budget on february 3. satellites by

spacex were launched into or it -- orbit. the first stage of the falcon touchdown -- touched down offshore, about eight minutes later. global news, 24 hours a day, powered by more than 2600 20rnalists and analysts in countries. betty: it is time to see how the asian markets are shaping up so far this warning. -- morning. david, what are you focusing on? onid: we are very busy monday. let me start up with currencies, because that is what is driving things at the moment in the equity states. where it is that 1.2% used to be. the levels are academic, and there is very little to suggest

that we are going to get a meaningful rally as far as the pound is concerned. this has been spiking up as well. the dollar/yen is 1:14 percent -- 1.14%. flip the boards, let's have a look at the nikkei 225 and the other benchmarks across the asia/pacific of the moment. this is where you get the most meaningful look at the move down in the first week. just below 19,200. we will talk about costs of it later on, can this has been stuck in a very tight range as of late. .60 1%.a is that .60%.l talk more -- we will talk more when the chinese markets open up.

have a surging commodity prices, whether it is iron ore, copper, you look at china, rubber, reinforce steel, take your pick. new zealand there, nothing special. have a look at some of the movers i am following in tokyo. you guys were talking about nintendo. let me get started that. they downgraded the cell, but when you look at j.p. morgan, they have a buyer over win that is a price surrogate for fast retailing. this is roughly where we are trading at the moment. the, and nintendo are down -- downtta and nintendo are for the second day in a row. betty: left a read on the screen.

some craziness also in the pound. the pound flutie is boosting inflation in the u.k.. i want to bring in kathleen hays. this week, we might be focused on trump but even more focused on theresa may? kathleen: theresa may just stole the spotlight. she gave a speech or we could go ago on u.k. television. about a way that made people think hard brexit. they think the same thing that the markets to after thinking that. story u.k. times and the that says exactly that is what she is doing. she is making a deal that will allow the u.k. to give up a terribly trade with the european union, with the u.k. will gain power over immigration and keep key things that are

important to the people. the pound is falling hard, and -- it ishat is a doing doing to inflation. this is risen in the last half of 2016 going into 2017, but the elu line shows prices -- blu line is growing at its fastest rate since 2015, showing an inflation booster. gthe latest inflation data from the u.k., it 1.4% insed to rise december. 1.2% is the current target, making the balancing act all the more tricky. but the market though, they seem to be rethinking the trump effect. kathleen: everyone will be watching all week until he swears the oath of office. the first 100 days points out it is important to trump and

whatever president, what can you do? can you get tax cuts and spending hikes agreed to by congress. we get some evidence that people are feeling better about trump, they are not translating that into action. i'm talking about december retail sales. friday, can he was bought more cars -- consumers bought more cars, but that was about it. we have a chart, and you can see the retail sales of 0.6% at the far right side of your screen. when you line shows take out cars, there is not too much going on. consumer sentiment remains here the 12 year high in the united states. trump missed the chance at the press conference do not thought the chance -- to not spell out what exactly he is going to do. we will see with the bond market does next. the rebounded bonds has quite striking, on a 1.36%

of the year. the fed speak about the impacts now? kathleen: we have yields rising and prices falling on the idea that donald trump will quickly retail -- reflate the u.s. economy, but it is turning around. there is some doubt about how fast he can move. this white line at the top of the chart, 5571, which shows prices rising again, pushing yields down again. this boom of the bottom shows how there has been a big shy -- spike in bob -- volume. on theirst-time voters fomc are speaking as well. if you want to know how they are itbring -- tilting when comes to policy. then there is the european central bank meeting. inflation.lk over

is this something that the colleagues have to respond to? bloomberg intelligence says no. there is a lot of talk, but no action. is also speaking on friday. there's a lot for macro watchers to watch. yvonne: trump has fallen back on his criticism of the u.s. intelligence community. trump doessaid that not have a full understanding of moscow's intentions. we have been talking about the macro fund, but also the trump tweets as well. we have seen exchanges between trump and brennan intensifying here. >> i did catch some of the interview that happened on sunday, and the delivery by the cia director was more polite, but his words and content not so much. called and ur

mments were called outrageous, you would probably bristle. or said youls you had a lack of understanding or disconnect about russia, you would also probably bristle at that. i dotor brennan said what find outrageous is equating intelligence -- the intelligence community with not cheap germany germany. this goes back to unverified reports that buzzfeed broke. trump said the intelligence agency said that should have never allowed that information to get out to the public domain. he also asks if we were living in nazi germany? brennan did take great umbrage with this. let's listen tomorrow what he has to say. >> if he doesn't have confidence in the intelligence community, what signals does that send to our partners and allies, as well as the adversaries? i think mr. trump has to be very disciplined in terms of what he

says publicly. he will be, in a few days time, the most powerful person in the world. >> and one really interesting thing, why -- while he did come out with these forceful comments, he also gave an olive branch, saying he does support the incoming and frustration -- administration and has no -- intention of undermining the president-elect. yvonne: so he said essentially, oh really, the whole idea of not standing -- understanding the relationship between each country? the buildup between syria and russia. was this the leaker of fake news? specifically pointing to those topics, saying

he did not understand ukraine, syria, or cyberspace. yvonne: no doubt, whenever you criticize trump, you will get something. you will get a retort. what trump clarified some policies on europe. he is not backing down from some of his campaign rhetoric. ramy: no, doubling down it seems. this interviewed germany is calling into question the essence of the u.s. and european alliance. a couple of takeaways here. one, he actually had he is calling -- said he is calling nato obsolete. this is huge. uk's also praising the exit from the european union, and also predicting that other eu members will actually follow the country. he is also looking at a company specifically, threatening bmw , saying import duty

listen, if you want to do business in the united states, you have to make your cars in the united dates as opposed to now,bmw is doing right building a new plant in mexico, similar with what is happening in other companies. we are seeing a lot of rhetoric, rhetoric that could essentially fearfully that potential he, potentially, fearfully, become reality. yvonne: we will hear from a ceo one indian company that is the biggest beneficiaries of the company desk countries cafe up with saw last year. this is bloomberg.

♪ this is daybreak: asia. betty: a quick check of the business flash headlines at this hour.

this company has seen its revenue drop for the first time in over a decade. the response from the company's property business outweighed growth from its attainment operation -- entertainment top operations -- operations. wanda is also looking to list is an met unit by 2020. -- its internet financing unit by 2020. cons of the company and its rivals continue to slash costs. ceo remains upbeat. we have significant events in the last quarter. that has been consistent with doing very well, so i am confident. this is something the impact willrbs, and some of that

-- weekendnd the holiday provided contradicting results for two studios. hidden figures generated $22 million in ales, but it is a different story for paramount. it's $125 million -- $125 monster truckson flops, after making barely $10 million. guest isr next representative of paytm. this has helped his ambitions, with 20 million ambition all users -- additional users signing up after the shocking

move at the end of last year. as is the founder and ceo, thank you so much for joining us. you are the subject of a lengthy profile on bloomberg news, where you mention a 22 million users after a ban on big denomination notes in india. has that carried through? are you still seeing the same amount of volume in the sign-up? >> think you having me here. will keepe momentum going through next month. even though cash is out there in the market, you are still seeing the same numbers being done every day. the numbers have not rob -- dropped. betty: so the momentum continues, but how do you build on that? that you arey getting the low hanging fruit right now, people who are comfortable with digital payment , but nowot sign on

they are. how do you build on that momentum? one, the audience. who is going to convert to our bank investments? who will do the wealth management? one is moving from payment to the bank and financial services, and the second is we had a tremendous [indiscernible] i did not realize or the last 100,060hs, we had computing about 20%, which used to be about 2% earlier. more than we expected before. aboutill help us give us half a billion customers by 2020. we will expect to expand to other places also.

we mentioned early on that you are backed by alibaba. they made an investment in paytm that was very instrumental in creating this country -- company. are you getting interests now that there is potential here in digital payments and india? are you getting interest to invest in pay tm -- paytm? >> we have been a lucky sport ever since the alibaba investment. the final loading we picked up from china -- loans we picked up from china, and we have gotten tremendous response. there is a global interest, mark's from the east -- markets from the east and to the u.s. also. meeting forstors

the last 3-4 months, but we have a lot on our books already. we are wondering if we should do a months time, or much later after that. you already mentioned the ties to alibaba, but dozens of rivals have jumped into this spree of digital payments as well. one addition is using this relationship against you, and how can you maintain this relationship while still appealing to india's nationalistic interests? the terms have no connection being totally and completely controlled by the law of the land of india. tomorrow, that is literally win the bank will be launched. our payment business and

financial business becomes a banks, and itytm is an indian domicile and to be, where i -- entity, where i have majority ownership. and etc.,bout banking subsidye part of it wilmel becn -- owned a subsidy. yvonne: vijay sharma, founder and ceo of paytm. up next, a multimillion dollar -- billion dollar lifeline within hours. this is bloomberg.

betty: yvonne: -- yvonne: this is daybreak asia. betty: chinese technology -- leecrate ago -- echo o did a $2.2 billion investment. how did this company get into this position in the first place? is one of the more

fascinating characters and china's technology sector. he got his start really with an online video company, known as chinese version of netflix. he foundedg success, it in 2004 and to the public in 2010, and the stock soared after that. borrowingo trouble by against the stock that he held into he -- as he expanded new areas, like smartphones, electric cars, and television, and took some potshots along some very iconic businesses, like apple. he once id he was going to surss tesla, and borrowing all the money got him into trouble. additional to raise capital, so they met with sumac, andconvinced then -- sunac convinced them to invest $2.2

billion, which will help for now. betty: and what will that do for him? >> he will be able to expand in the areas he sees as most promising. is pursuing electric cars. they have gotten good reviews for these cars, they look very good. they have good technology in them. he is building a new plant in nevada, so if you get the state support for that. he has been expanding into smartphones and that is a little notrockier, so he may surpass that area. and he is also trying to close zio, thel for vi american television manufacturer. betty: which of these benefits this is that businesses would benefit him the most now? >> it is unclear where this cash

will go. forould be paid in exchange co holdingthe lee company. important,rs is smartphones are important, and the key proponent for them is the online video business you're in they want to make sure that is going well. that is us for -- it for us here on daybreak: asia. we are looking at some of the continued reaction in japan on those machinery numbers, and looking ahead to much more economic data. like we are headed for a slightly higher section.

♪ rishaad: it is 9:00 in the morning in singapore, midday in sydney, 8:00 p.m. in new york. i am rishaad salamat coming to you from bloomberg asian headquarters in hong kong. this is "bloomberg markets: asia." ♪ the pound falling to levels not seen since 1980 five as theresa may expected to take a hard line on brexit. state of this union, trump taking aim