♪ 7:00 a.m. in hong kong, live from bloomberg's asian headquarters. i am yvonne man, welcome to "daybreak asia." a mixed day ahead for the asia-pacific. wall street saw losses in consumer and energy. day,&p fell for a fourth the longest losing streak of the year so far. investors now await the fed. betty: i am betty liu in new york. it is just after 7:00 p.m. thursday evening. good news for broadcom. after a bruising week in washington, earnings are in line with estimates. -- hethe end of the line

has led the pboc for 15 years. ♪ in another three years at looks like we are going to be here in a recession in the u.s., if you look at key market indicators. i want to pull up a chart showing you some of the market indicators, as calculated by bloomberg, looking at credit spreads and the yield curve. it shows there is now a 100% probability of a recession in the next three years. data,an looking at their saying that probability is 72%. it begs the question, may be on

the one hand it is right for the and onbe raising rates, the other hand, are they raising rates going into a slowdown in the economy? at least if they have rates a little higher, that gives us is true thet economy slows down to a recession. yvonne: it is interesting, that jpmorgan call, twilight of the cycle they call it. think of cycling out of equities and perhaps into bonds. have beenheadlines dominating, not just the white house chaos, but trade concerns. certainly we are learning more about this robert mueller probe, getting closer to the president and his businesses. betty: let's quickly look at how the markets traded today. marginally it seems, ignoring and focusing on the

fed next week and what larry kudlow said about the dollar, a mixed message in the markets. and focusing on the fed next week andthe s&p a litth day down. 115.ow, up the nasdaq, down 0.2%. yvonne: we are pretty much treading water as we wrap up of the trading week. look at new zealand, the nzx 50, holding at .7273. the bulls reinvigorated by kudlow. asx 200 up 0.2%. the aussie holding steady. 2.74, the aussie tenure. we could be seeing pullback today. dollar-yen, we are seeing strength of this morning, 106.30 against the dollar. the new york times says

robert mueller's team subpoenaed the trump organization for business records, including some related to russia. the president's company told the associated press the story is old news, and they have been fully cooperative with the mueller organization. they sanctioned several businesses. mueller indicted them for meddling in the election. is jumping in late trade after the former chairman is seeking funding for a buyout. has approached several investors, including softbank. they say jacobs informed the board about his plans. the news comes after trump blocked broadcom's bid for qualcomm. they paid 59% less on average and then their male colleagues,

the widest gender gap. it is also three times the national average. the gap will widen to 60% this year. employees250 u.k. have to disclose their gender pay gap's. a new pedestrian walkway collapsed onto a major road at florida international university. emergency services say at least eight vehicles were crushed under slabs of concrete. the $14 million bridge crossed a seven lane highway that divides the campus to the city of sweetwater. it weighs 950 tons. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. i am jessica summers. this is bloomberg. ♪ betty: jessica, thank you. let's get back to the u.s. markets where stocks were mixed,

the dollar writing, gold sinking, larry kudlow with tough stance on china. su keenan with the mood of the market, jumping ahead to next week's fed meeting. durable rates and goods supporting the higher rate. let's go to the market snapshot. the dollar climbing, gold sinking on those kudlow remarks. oil above 61 on slightly bullish remarks from the iea. let's go to the big movers. it had a lot to do with earnings in particular. down at onefocus, point at 1.5%. they came out with an app called would you rather -- would you rather slap rihanna or punch your ex-boyfriend? imagine, she was in a

domestic violence incident. she was outraged, so were investors. limited partnerships will not get a tax break from the tax reform, in fact, they will lose a tax allowance. dollar general reporting positive earnings. that moved higher. that was interesting, because a lot of retailers have been hurt recently. . g #btv 8734. dollar doldrums is the title of this. it is ironic, bill -- because we talked about dollar bulls coming out of the woodwork. it has dropped relative to unhedged funds, which means there is still volatility out there. su, thank you. we are expecting the fed meeting next week. they get ready to consider a faster rate of fed hikes.

orstions of whether they can should are being asked from wall street to the white house. let's go to kathleen hays, she is here with the latest. let's start with larry kudlow. what did president trump's new warriors say about the fed? >> some are calling him the economic evangelist. what he did, in an answer to an interview said, the fed should be careful on rate hikes. referring to growth in the economy he said, just let it rip, for heaven sake, the market will take care of itself. the fed will do what it has to do, but i hope they don't overdo it. july he said in janet yellen should -- remember he said the fed will do what it has to do. he is a long time fed watcher.

he has criticized the fed inflation models recently. others in the fed her wondering about inflation targeting and what the messages. --'s look deeper into what who larry kudlow is. started out studying economics and politics, became chief economist in his early 30's, chief economist at the office of management and budget under president reagan. taxng time supply-sider, cut growth, watching the dollar, watching gold, signaling monetary policy, not just jobs. acnbc contributor. i got to know him well as a journalist. cnbcher we worked at during the 1990's. he did say in an interview he would like to see the dollar a bit stronger. he has been talking about king

dollar forever. he thinks it is a sign of a strong, powerful economy and country. he thought he would go further and advised people buying the dollar and selling gold. i would suspect as time goes on, he would refrain from what you should buy or sell when he is officially sitting at the white house as the new economic council. say it is not a job and economists have to do, it involves project management, coming up with economic solutions for the president to look at. larry kudlow is not the only one who does not think the fed will speed up rate hikes. one it morgan stanley think there is a high bar because too many people would have to change their mind about quattro versus three for that to occur. betty: turning to china with trump attacking china on the trade front, there is concern china could retaliate by selling

some of their u.s. treasury holdings. do we see this in the holdings? kathleen: one more thing on larry. he said china does not have the right mindset on trade. we did get u.s. treasury data thursday that shows china's u.s. ind holdings declined trillion.o $1.17 china remains the biggest foreign creditor to the u.s., holding so many notes, bills and bonds. they are followed by japan in second place. of u.s. bondship sold for the fourth straight month. is there-this story? our news team in tokyo pointed out an interesting thing we need to look at g #btv 9267. we are going to compare foreign custody holdings, the new york

fed holds securities for foreign central banks. this blue line shows they are seeing china's holdings are starting to read accelerate, starting to rise again, even though the less reason data is showing they are falling. they are saying maybe this is a false and nothing has changed much yet. we will listen to kudlow, change these lines. betty: thank you so much, kathleen hays. i want to quickly mention that wesfarmers shares are up 5% in sydney trade with of that announcement they will be spinning off colds, after their afterition -- coles, their acquisition. that is a supermarket. they are in competition with worth. worth -- woll

japanese prime minister shinzo abe's long simmering scandal threatening to boil over. what that means for currency markets, the boj and abenomics. as china gets set to reveal its next central bank governor, a look at the prime candidates and how they could affect policy. this is bloomberg. ♪

♪ betty: this is "daybreak asia." i am betty liu in new york. yvonne: i am yvonne man in hong kong. will finally be announced monday, five months after governor zhou xiaochuan said he would soon be stepping down. tom mackenzie joining us from beijing for more. there have been rumors about who he or she might be. we are not sure until monday. but who are the most likely contenders at this point?

tom: that is an important caveat, we do not know for sure. some names have risen to the top. that has been newly empowered. i will run through some of the top contenders. guo shuqing is currently the chairman of the banking regulator, cbrc, seen as fairly robust in tackling shadow banking. he has had a role in trying to curb overseas buying of assets by the likes of anbang and fosun. then we move on to jiang chaoliang. hobs the secretary of province, almost asei populace as italy. in fact, he oversaw what was at the time the biggest corporate bankruptcy in chinese history. he also served as an assistant governor for the pboc.

he has a wealth of experience. the other potential candidate is liu he, who is seen as the present -- seen as the brain behind president xi's attempts. he is likely to become vice premier. if he was given the pboc post, that would be seen as a further elevation for the central bank. some analysts said it would be too much for liu he to handle, the size and scope of that portfolio. and then yi gang is the deputy governor. numberhou xiaochuan's two. it would be seen as a 's policiesn of zhou and stability. yi gang is also one to watch. and outside contender is xie fuzhan, currently the party secretary of conan province -- hunan province.

some challenges around that, financial risk, and moves toward liberating the yuan. betty: a great rundown of who are some of the contenders. in a china economist at capital economics in singapore, tom staying with us. he is bloomberg's most accurate forecaster on china's economy. who do you have your bets on? clearly, the people's bank has been given more power, now that it has been given control over the direction of banking and insurance regulations. i expect somebody with clouds of their own to take on the position. more important than the individual is the broader trend with the pboc's role in financial regulation being regulated. also, the party taking greater control over the states.

whoever ends up as pboc governor will not have as much independence as in the past. they will have to toe the party line. butaps more implementation, less so when it comes to policymaking. betty: it might become more unpredictable to see what the pboc, what steps they are going to make, because you have zhou xiaochuan on top of the pboc for 15 years. there is a certain amount of pattern recognition for how he would conduct monetary policy. is it fair to say there would be more volatility, people having to restudy the pboc? julian: we are certainly stepping into unknown territory. the pboc at the moment does not have a clear monetary policy framework. we shifted from a system where we focused on changing bank

rates, to assist a more complex. they have multiple policy variables. it has already become more difficult to read, what the pboc is doing. i think that will become even more so, particularly given that will not be as directly in charge of the direction of party making as they were in the past. to some degree, at the risk of the whims of the party, which could change very quickly if the economy were to begin to slow again. at the moment, all the focus is on deleveraging and addressing financial risk. line could shift down the if the economy, labor market, looks week again. -- weak again. tom: you talked about priorities on debt and financial risk. what further steps to liberalize the yuan become a priority?

given they are, trying to contain these risks as a number one priority? julian: i think they are being cautious, given the problems they have had with the renminbi in the past few years. i do not think it is an immediate priority. we have not yet seen capital go back. we see a widening of the a first trading down, step toward liberalization of the currency. aven we have not seen those steps, it seems to me they are being quite cautious. onhink they are focusing dealing with the health of the financial system so that when they do liberalize the yuan, there is less of a risk of outflows. yvonne: you have been skeptical of the official data numbers that come out of china. how do you factor in the risk

now the president xi has consolidated power, when it comes to your risk forecast? julian: we do tend to be skeptical. although the past couple years, our figures have re-converged with the official figures. the economy has witnessed a recovery. i think the risk going forward hashat, although xi jinping consolidated power successfully, he does not seem keen on rolling back the role of the state in the economy and state intervention, which, in our view, is a big problem, holding resulting in a buildup of debt levels. they are taking steps to improve the risks come the vulnerabilities, on the financial system. we don't think they are taking steps to improve new lending, which makes it hard to withdraw

credit reports. which is why we are seeing slowing credit growth to the we expect that to slow economic growth. it'll be interesting to see if they are willing to accept slow growth. what we have seen in the data this week, domestic demand seems to be wavering. land sales are a good indication of how pretty sector. that has been plunging. when you look at the risk to the chinese economy, do you have to look more inward to any threat of a trade war? julian: export an internal demand are holding up well. there are threats of a trade war that remain to be seen. for now, the clearest risk is the property sector, a very sharp slowdown in sales growth. mortgage rates are still rising at the start of this year, which

will take further wind out of sails. athough we had a bounce back industry at the start of the year, that was largely a one-off because of the easing of anti-pollution controls. i don't see where that trend will be sustained, either. there are downside risks to domestic demand this year, which investors should keep a nine on -- keep an eye on. yvonne: thank you. don't forget our interactive tv function, tv . watch us live, catch up on interviews, follow securities or functions we talk about. plus, become part of the conversation. send instant messages during the shows. this is for bloomberg subscribers only. this is bloomberg. ♪

♪ ."tty: this is "daybreak asia

i am betty liu in new york. yvonne: and i am yvonne man in new york. trading him start in york stock exchange on april 3. they announced the date at a live stream event, designed to introduce the company to investors. they are targeting revenue growth of 25% to 35%, compared to 39% last year, when it reached $5 billion in sales. --ty: the former espn resigned after a bribery plot by a cocaine dealer. he discussed the situation with the disney ceo and they agreed he had placed the company in an untenable position. he resigned on december 18. up next, broadcom the faces investors for the first time since ditching its attempt to acquire qualcomm. this is bloomberg. ♪

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♪ yvonne: 7:30 this foggy friday in hong kong. asian stocks, despite fear of trade wars and white house, looking better at the end of the week. getting set for the best week in a month. 30 minutes away from the asian market open. betty: in new york, markets closed mixed, the s&p down for a fourth day in a row. i am betty liu in new york. yvonne: i am yvonne man in hong kong. this is "daybreak asia." china's holdings of treasuries in january fell to their lowest since july, as

investors turned a on fixed income and the dollar. tods, notes and bills sank $1.7 trillion. they endured the worst january fears2009, due to inflation could cause the fed to hike rates more aggressively. toys "r" us has confirmed it is going out of business, after a rescue effort failed to save it from rising competition and crushing debt. it threatens thousands of jobs. toys "r" us files for bankruptcy in september with a turnaround plan. but holiday sales plans disappointed. wesfarmers jump to the most in more than eight years. they want to spin off their coles -- they want to spin off their coles supermarket business. they seek board approval and third-party consent.

in 2007.s bought coles parent plunged after rihanna criticized the app that asked viewers if they wanted to punch her or slap chris brown? she was a victim of domestic violence. snapchat removed the game from an app called "would you rather?" she experienced domestic violence while dating brown in 2009. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. i am jessica summers. this is bloomberg. ♪ yvonne: we are counting down to the market open in tokyo and seoul. for the latest, with sophie kamaruddin. investors were hoping for a quiet end to the week. >> we are facing a mixed friday session. they have gone around talks of

trade wars, north korea, the plot thickening with japan over the land scandal. when you take a look at the futures board for japan and korea, this is the setup. in sydney, aussie stocks snapping a three day shop, led higher by telco and consumer staples. checking in on the greenback, king dollar regaining ground, getting a kudlow boost. but there are signs investors remain hostile. funds are rotating out of hedge etf without policy protection. 313 to illustrate this. it protects against fluctuation in the yen. they pulled $1.2 billion from the fund, sinking to the lowest level since 2013.

unhedgedison, the in 2018. gaining 1.5% the slow pictures signals investors have no problem snapping up japanese stocks without shifts in the dollars, which is broadly seen as a weakening further. of the current goldilocks backdrop, analysts are most of bullish on japanese stocks since 2011. could this be too optimistic? sophie: almost 2/3 of analyst calls are buys. says this could be a sign of a downturn. analysts are beginning to tap the brakes on those profit upgrades. pulling up g #btv 9319. essentially what is happening,

korean stocks seeing forward earnings estimates falling. korean companies still expected to report better earnings than last year. analysts are temporary -- tempering their expectations. week's g20xt meeting, they raised the forecast. warning it is growing too fast for its own good, thanks to risks. say investors are underpricing certainty over the future path of interest rates. betty: thank you so much, sophie kamaruddin. a speaking of shares, wesfarmers shares are surging with mining and retailing conglomerate announcing it will spin off its australian supermarket chain coles, it is up about 5%. wesfarmersoks like

is trying to focus on faster growing businesses? >> that is the plan, wesfarmers putting out a statement announcing it will give a higher capital rating to businesses with stronger growth prospects. no longeron, coles fits the definition. in 2007, over coles where they said they turned it around. as aso describes coles mature, cash-generating business. generate cash it does. it is responsible for about 1/3 of the earnings for wesfarmers. they say the company should now be owned and operated separately. that is planned for 2019. it is expected to be ranked in the top 30 on the asx. yvonne: it seems wesfarmers well retain the 20% stake in the company. what is the strategy? paul: wesfarmers is usually

diverse. it has mining interests as well as significant interest in retail. it has money and a popular hardware chain, kmart, and office works as well. they are looking to retain synergies across different brands. once this gets approved by the board, wesfarmers shareholders would receive shares in coles for portion it to their current wesfarmers holdings. leadership changes to let you know about as well. md ofo will replace the coles. they had been lagging behind worths in sales. we will have to wait until 2019. yvonne: we showed a chart how the stock has plunged.

thank you. broadcom back in the news after president trump close down all paths to its acquisition of qualcomm. this time, good news to talk about. be earningsr forecast. i will bring in remy inocencio, who has the details. eps, that was a beat. revenue came in line, 5.3 billion. and there was also this surprise dividend for investors on the order of $1.75 a share. you would think the stock price would be rising in after-hours trade. let's flip up the board. you can see it is not. it is down by 1.7% now in after hours trading. the reason for this could be because the second-quarter guidance moving ahead. the current quarter we are seeing now, in terms of revenue guidance.

share -- a hair shy of what investors were expecting. they wanted to go even more than that. there is a lot of good stuff to go through. let me take you through some charts. after this i want to show you the eps. the most recent quarter, the first quarter, we see eps growth of 41%. the last time we hit that number was two quarters ago in q3 on the order of $5.12 versus $3.63 a share. that is not where the good news ends. the next bloomberg terminal chart is the dashboard for semiconductors, broadcom. this is a wireless communications margin for this division. back in the second quarter of 2016. this year, just 24%. recently after they completed their merger. it has been rising since then,

up by 45%, 46% in the recent quarter. in terms of total gross margin, 65%. second-quarter guidance, a couple percentage points higher. especially with the semiconductor industry booming, broadcom, aside from second-quarter guidance, is doing more than good. it is doing quite well. but investors do not seem to be inspired by the second-quarter guidance. what does this mean for the strategy next month? ramy: that was a huge question, especially on the earnings call. walk to this side of the screen. he was over at the white house in november, trying to convince donald trump to make sure this qualcomm-broadcom deal to go through. we now know that it did not. the question is whether hock tan can look to any m&a in the u.s.

he is moving his domicile. take a listen to this. >> qualcomm was clearly a unique and very large acquisition opportunity. given the maturity of the industry, the consolidation it has seen, and their relative side now, future acquisitions are more likely to be funded with cash available on the without the need to flex it beyond our current policy of two times net leverage. ramy: tom krause there, said it was a good opportunity. now since the deal is no longer possible, there are other people, in a strange twist that just happened the last hour, someone inside qualcomm. it recently demoted chairman paul jacobs. he said, i have been listening

to several global investors, even though i have just been demoted, i want to try and by qualcomm. this is paul jacobs. he says he is in talks with one, softbank, in addition to several others, unnamed. softbank could be one of the potential partners. softbank and qualcomm have denied to comment on this. this is an interesting twist, seeing the drop off in investor sentiment. flip up the board one more time, because this is what is happening in after-hours trading in terms of qualcomm. we can see the share price is rising 6% in after-hours trading. we have seen a fall after trump said this would not be happening, that there is some investor enthusiasm. coming back where we were at the start of the week. a lot of twists and turns, looks

like it is not over yet. betty: not over yet at all. thank you so much. the scandal embroiling prime minister shinzo abe's administration may be more serious than some investors realize. it has been hanging over the markets. a will discuss that with senior strategist. this is bloomberg. ♪

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expanding the daybreak franchise, i am yvonne man in hong kong. betty: clearly global. i am betty liu in new york. only two weeks ago, shinzo abe was a solid bet to be japan's longest-serving prime minister, but his position reversed quickly, regarding a land scandal and documents. we have seen abe and his deputy taro aso interrogated by their own party on this. how rare is this scenario? >> it is pretty rare. but there is another way to spin that. by having one of his own party was able tong, abe answer how he wanted. he said, even if you look at documents prior to alterations,

it is clear there is nothing connecting him to the sale of this land to the schools. there are two problems. in a government involved ordering public land sold at a discount to the school? and the other, did finance minister bureaucrats alter the dot -- alter the documents? focus has shifted to the finance ministry. in ordering public land sold at a discount to the school? can say these abe officials took steps on their own without official orders. that insulates them from the problem. i would point out a problem in japan, where people lower in the actual on -- lower in the echelon start doing things they think would please their higher ups, even though they don't have explicit permission. they may say it is a case of that. betty: sounds intriguing. what are the next big steps in this drama? what we need to be watching out for?

>> as of this moment, it is quiet, it may be the quiet before the storm. we will have the finance minister also in parliament all day. a.m. untilm 9:00 8:00 p.m. potentially, answering questions. he also has a press conference before the cabinet meeting. that is the first thing to watch. second thing, public opinion surveys. we expect to see them over the weekend. approval rating in the 46% range. if it dips into the 30th percentile that would be a problem. the next thing to watch for is monday, when we see the finance ministry official who used to be head of the tax agency, he may be called to testify in parliament monday. that would be big. yvonne: how important is aso to abe? if aso goes, is all lost?

brian: on the one hand, aso is abe's most loyal, stalwart supporter. on the other hand, abenomics has been a huge success. whoever would to -- would succeed aso, economic policy would be stable. yvonne: thank you, a lot to look ahead to on this looming scandal in japan. let's discuss that and the potential impact on currencies. while policy change is unlikely, foreign investors could react. senior us from sydney, currency manager at commonwealth bank of australia. seems the scandal is not going away for shinzo abe. are we still misplacing the risk at the moment? >> good morning. i think the political scandal in

headline generated risk, volatility for the currency. but it will not be a key driver in the japanese yen. rather, the yen will continue to be influenced by three key drivers. a stable backdrop, diminishing risk of more easing from the bank of japan, and third, our view that the u.s. dollar remains in a broad-based downtrend. they have a massive asset surplus. this means japan is not vulnerable to a slate of things on the political front that turned out to be ugly in japan. it has been interesting, given how choppy it is, i have a chart that shows where we are seeing the dollar yen trade. the correlation

broke down earlier this year. this can stick? what needs that happen for the yen to stay the driver of u.s. rates? elias: first of all, the fact inflation pressures in japan have improved, economic activity is relatively encouraging, this has significantly reduced the risk of more easing from the bank of japan and that is supportive of the japanese currency. more importantly, we still expect in the u.s. dollar to the lower this year because rate hike is already priced in. -- andless scope of global growth is improving. onse will continue to weigh the u.s. dollar. that is why we see dollar-yen trading lower, even though you have a divergence between the

dollar-yen and u.s. treasury yields. betty: as much a yen story as it is a dollar weakness story. i want to pull up another chart that illustrates that, g #btv 8 236, which i pulled up a little earlier in another program, which basically shows you how as political risks escalate, as shown by the white line, the dollar continues to fall. this inverse correlation. you take that and compare it to comments we heard from larry kudlow, the incoming economic adviser in the white house who says, we still believe in a strong dollar. you would think the markets would ignore any of those comments? elias: no, the market won't ignore that. what is important to understand, a big risk for the dollar, at

least for a bearish u.s. dollar view, is the threat of escalation and trade tension. this could derail the current recovery underway. that is potentially supportive of the u.s. dollar, particularly against the commodity-sensitive currency. what is interesting, there is an imf report which shows if the u.s. did implement significant tariffs on a broad-based basis against east asian countries, it would lead to dollar strength, whether there is trade retaliation or not. in our own studies, when we look at the implication of heightened trade tensions and how this could impact the u.s. dollar, we could see there are three avenues by which the dollar could be impacted. under the monetary policy channel, global growth outlook channel. our overall conclusion is that if things do deteriorate on the

global trade front, it would be supportive of the u.s. dollar, especially against the aussie, kiwi and canadian dollars. betty: thank you so much, we will leave it there on the dollar. roundup of that story, many more you need to know to get your day going in today's edition of daybreak. subscribers go to dayb on your terminal. this is bloomberg. ♪

♪ yvonne: this is "daybreak asia." i am yvonne man in hong kong. betty: i am betty liu in new york. says it is actively taking measures to maintain operating stability as it faces a record $1.9 billion of bond repayments this year. the company came to prominence with last year's $9 billion deal.

since then, its chairman has come under investigation, while bonds have posted record declines. yvonne: blackberry boss john chen has a new contract with $128 million to keep him in the job for five years. chen has turned blackberry into smartphone maker to a lien maker of security software. blackberry shares have climbed around 15% this year, after gaining 60% last year. betty: a group of junior noble group shareholders says the company's survival plan is not good enough. they hold 25% of the $4 million perpetual bond, and say their opposition to the bill is unchanged. any change to the perpetual bond term may be with approval of 75%, which means they hold a blocking stake to the proposed that deal. yvonne: coming up in an hour, deutsche bank gives its outlook

for asian markets. don't miss our talk in 15 minutes. the market open coming up as well. a little more quiet to end a very loud week. this is bloomberg. ♪

yvonne: 8:00 here treated -- here. i mixed a day ahead for the asia-pacific after wall street offers little impetus. tillerson, the asian benchmark is set for its best we can month. betty: i am in new york where it is just past 8 p.m. on this thursday. robert mueller has subpoenaed the trump administration for documents related to russia.

♪ yvonne: we have been talking about slow going here as we wrap up a busy week. we have been waiting for the fed, it seems. we have been listening a little bit to larry cut located -- kudlow. does this mean the u.s. is headed into domestic policy? betty: the u.s. has said they believe and a strong dollar policy. we heard that explicitly coming out from larry kudlow. we have been talking about this trajectory for the dollar, it seems intact going lower and about morete talk

rate hikes coming out from the fed. a real conundrum. yvonne: yeah. it certainly will be. let us take a look at how we fare in the asia-pacific. quiet, but we will take it. betty: we are seeing green in tokyo. topics gaining ground as well. stocks in sydney are snapping a three day decline. we are facing a pretty upbeat session. turmoil this week, we are set for the best week in a month despite the turmoil from political drama at the white house to consternation about trade retaliation. we have a light data docket today. investors have been keeping their powder dry ahead of next week's fed meeting.

on the agenda in asia today, we are looking at singapore exports. we will be digesting peter on trade statements war. some investors are bracing for the worst from trump's tariffs. check this out. this shows you the goldman sachs index of u.s. exposed japanese stocks. since trumplined 2% said he first would impose tariffs. we certainly could see some weakness there given the consternation over the impact of a tariff study. you.e: thank the trade war tariff situation still hanging over the market. let us get to the first word news. 4 thank you.

reporting, paul jacobs is speaking -- seeking funding for a buyout. globalapproach several investors in a bid to acquire the chipmaker founded by his founder. -- his father. after donald trump locked to their bid for the company. holdings in the treasury has fallen to the low lowest -- lowest since july. the portfolio sake to one $7 trillion. and thirdond market worst january since 2009. inflation could force the fed to hike rates more aggressively.

it would create a company among the 30 biggest on the asx. they expect to complete the deal in the 2019 financial year subject to board approval and third-party consent. its shares have lost more than 7% this year. several people were killed when a new pedestrian walkway collapsed onto a major road in florida. emergency services say at least eight vehicles were crushed under slabs of concrete. the $40 million bridge crossed a seven lane highway. 950 tons and was installed on saturday. this is bloomberg. yvonne: thank you. coming some headlines

through from local reports in south korea. may send a delegation to north korea in late march. this comes on the back of what we learned a week or two ago about the president trump accepting an invitation from kim jong-un to me. we have seen how many other people are thinking of bout -- about talking to control himself. certainly one to watch. jodie snyder here to talk more about this right now. it seems like everyone is joining in on these talks. how does that work? yvonne: the doors open -- reporter: the door is open. we do not know when the u.s. is going to talk to north korea and how that will work. open, thehe door is japanese prime minister said

they would want to have talks as they are not included in those u.s. talks. now we are hearing about china. we do not know what that means or how that would work. south korea opened the door. it started at the olympics. everybody wants to say, let us see how further we can get involved. we do not know what the structure of these are going to be. about,as been some talk they will only seriously talk if on the table is north korea abandoning its nuclear program. they are not going to do that. they have given no indication of doing that. we do not know how serious the u.s. talks are going to be. have seen the china and north korea relationship being trained -- strained from what we saw last year. they have not met recently or had any communications. the exactly do you think chinese delegation wants to get out of this meeting if it happens? indicatedchina has

that it would be willing to discuss -- they have not been fans of the sanctions from the u.s.. they have been willing to discuss ways they can temper the north korean leaders movements. they have not been willing to stop the flow of oil to north korea. continued to support north korea although they have been publicly annoyed at north korea. duringd some tests important chinese meetings. china was not happy about that. there have been growing tensions. maybe the talk to be a way to say, we still support you in some ways. we are watching as well. we are going to be more strident in our responses as well. it is an interesting development. we do not know how any of these talks might work out.

yvonne: we do not know how they are going to pan out. let us talk about a new significant piece of news in the u.s.. robert mueller's investigation seems to be taking another step closer to the president, subpoenaing documents from the president. does this seem to cross a red line for president trump? these sanctions and this action is really viewed as symbolic. the bipartisan legislation that was passed last august in the u.s. congress requires there to be this list of oligarchs that cannot. treasury is following up on that. analysts say this is more messaging than anything else. members of both parties are calling for stronger action. republicans are concerned that if it looks like they are not being tough enough on russia, it

can hurt them in the midterms. democrats are saying it is interesting that now that the administration is taking some action, it proves that mr. mueller's probe is not a which hunt. -- witch hunt. yvonne: speaking of other news around the president, we have larry kudlow with the incoming economic advisor to the president. coming out with these bold comments, strong against china. strong on the dollar. do you think he is going to have much influence on economic policy? reporter: he seems to be an economic warrior. or at least a mouthpiece for the president. somewhat unusual to come out on television just after your appointment is announced and to be making market tips.

strong on the dollar. so on gold. -- sell on gold. theing about things like central bank, which advisors do not tend to do publicly. it seems like he is going to side with the president. round of taxother cuts, things the president has championed. it seems like he is going to be a supporter of the president. gary cohn who came before him publicly feuded with the president on the tariffs. yvonne: we have been hearing some comments from the president when it comes to south korea. what is he hunting that -- hinting there? talkser: there are trade and negotiations occurring in washington right now between south korea and the u.s.. , weas come out and said

give south korea a lot of military support. we need to look at that. these were remarks that were made to donors that became somewhat public. it is very interesting that he would do that. this comes at a very interesting time. there is going to be these talks are north korea -- or they talking about talking. south korea has begun talks with north korea. any indication of pullback of u.s. military support would be quite a complicated factor at this time. yvonne: certainly as we are waiting for terrorists. reporter: south korea is hoping they will be exempted from the tariffs. that is part of the negotiation. yvonne: lots to impact there. -- unpack there. hong kong's richest man holds his annual press conference. next, a friday for

asian stock rallies. this is bloomberg. ♪

betty: i am in new york. yvonne: i am in hong kong. there is a rally in asian stocks. let us bring in our next guest who was long on asian stocks. he is asian-pacific cio. thank you for joining us. i want to throw up a big chart of what we have been seeing here. we have seen, despite all these political headlines, despite these fears of head concerns, ratings are optimistic. of the 18,000 analysts we have

surveyed, more than 60% actually say that stocks are raising right now. is this a positive thing or is it too good to be true? have seen, starting from last year, analysts becoming more positive, especially on asian stocks. asian the main reason, corporate leanings have been disappointing over the past three years. they tend to be more on the cautious side. last year was the first time we have seen companies actually delivering positive earnings. analysts have also been tempted to follow up on this. now you see the trend continuing. more and more analysts have to revise their earnings on the upside. this is a reflection of the positive earnings growth momentum we are seeing here. do you call this all

noise, what you're hearing? departures in the white house. the market still seems to be quite divided between, this is trump being a negotiator, versus something more aggressive. we are monitoring this closely. it as a potential threat to the markets early last year. it did not really play out because there was no trade noise at all. talk resumedtrade this year. as long as it is only concentrated on the steel and tear, this is what the market can digest. the impact on each and every reason -- region is minimal. if it is spreading to other goods, obviously this can cause

a trade war of retaliation from other countries. that is when we might need to revise our outlook. for the time being, we are still quite constructive. you mentioned positive earnings growth. see that there is a break in the pace of the profit outlooks from analysts as well. take a look at some of these profit upgrades. at what point do you think you are going to see this rollover? >> for sure. ofn you look at this part china/asian exports that make up almost a quarter. section 301 would come through. yvonne: could that benefit some of the other tech players? >> theoretically, yes.

it might also spread over to other countries as well. it is not only coming out of china alone. what we are living in. it would have a clear impact. we are definitely close. yvonne: there is some debate whether a trade war is going to hit tech shares. i know you are all constructive on tech companies. is this a place where investors can go to in the midst of trade tensions? >> yes. said, we have a very positive tech stock starting last year already. we have seen profit-taking at the end of last year. during the recent correction, most of the stocks also going

back. the overall outlook in the stage we are currently still provides very good potential. if we see any sort of escalation in terms of intellectual property here, we might need to revise it. yvonne: we have been talking so much about the dollar today. the bearishness we have seen in the dollar. you have a contrary in view. you are along the dollar. were quite wrong with our long dollar view. this year i think we have even more reason to believe the dollar should reverse. hide andd is going to next week. is the to see what message that the new fed chairman will address to the market. like the consensus, we are

expecting free rate hikes this year. the risk is on the upside if there is a chance for a right -- rate hike for this year. it would make the u.s. dollar stronger in our view because interest rate differential should be in favor of the u.s. policy. yvonne: what is going to hurt more if we see dollar-yen hitting 100 or treasury yields hitting 2%? -- 3%? >> we are close to 3% anyway. 3% is not the pinpoint for us. it would rather be three and a quarter. it would revise our outlook your as well. most of the year's increase we are expecting from the full year , it has already happened in the first two months. 100 dollar-yen would hurt more the japanese economy. we are rather expecting this not to happen. yvonne: ok.

thank you. next: up this is bloomberg. ♪

yvonne: this is daybreak asia. betty: radcom back in the news after president trump with a couple on it acquisition of qualcomm. some good news. we have those details. reporter: the eps came in better than expected. revenue came in in line with that. was also a surprise dividend for investors. you would think that would have

a positive knock on effect in terms of the share price. guess again. flip this green and we can see that the share price ended near its low in after-hours training, down 2.1%. analysts are saying this could be because of a second-quarter guidance coming in at $4.99 billion. people are counting every single penny. hopefully it would be just a bit higher there. there is a good news across the board in terms of the data. one of them is eps. 41% --.ew 41%ps grew we are looking at the gross margins. the margins for the wireless communications division.

in 2016, this was just 24%. it has been climbing because of cost cutting and efficiency. it is up past the 45% mark. in terms of gross margins, it is up 65%. those are the good news. the good things that are happening here. follow me to this side of the screen. i want to tell you about the strategy they have to do in terms of m&a. a lot of analysts are wondering, they're going to be looking for m&a someplace in the united states. his cfo did. >> qualcomm was a unique acquisition opportunity. given the maturity of the the conciliation it has seen an are relative size now, our future acquisitions are

much more likely. without the need to flex the balance sheet beyond our current financial policy of two times that leverage. radcomr: if qualcomm and cannot happen, there is a twist that is happening in terms of qualcomm's demoted ceo. it turns out in the past few hours the financial bank is reporting that the sky has been talking to several global investors, possibly including softbank, that he wants to go and buy the company his father founded area -- founded. the screen. qualcomm is up by as much as 60%. it then settled. investors optimistic on this after we saw a fall early this week when donald trump closed down the deal between broadcom and qualcomm. yvonne: thank you.

breaking down those qualcomm and broadcom, the latest there. it is time for joe to go. the pbocnor has led for years. we will look at possible successors next. this is bloomberg. ♪

yvonne: 8:30 in singapore. these are the breaking numbers coming through when it comes to exports. betty: we have singapore news here. nonoil domestic exports falling 2.6%. expectation was for a slight recovery from the month before. these numbers affected by the lunar new year holiday. expectations were for these numbers to be a bit worse or a little more dampened than what was expected. this is a big miss. reasonxports are a big we are seeing these export numbers fall down 12 point --

12.2%. expectations were a rise of 2.8%. that was supposed to be a recovery from the prior month. domestic imports year by year down, also missing economist experts by a ride -- wide margin. we will see how this affects his singapore markets when they open. let us get to the first word news. we have more. reporter: the new york times says robert mueller's team has now subpoenaed the trump organization for business records, and that includes some related to russia. the presidents company said the story is old news and it has been fully cooperative with the investigation. the u.s. has sanctioned several russian citizens and businesses after mueller indicted them for meddling in the election. russia has to the polls on sunday for an election where the

result is a near certainty. president vladimir putin wants a fourth term and few observers expect them to be disappointed. the russian economy is struggling under the weight of lower oil prices. the ruble has fallen to its lowest in more than a month. the president is under pressure. putin managed to reduce political activity and society. there is more antipathy in russian societies and six years ago. this at the calm before the storm. if he does not come up with something soon after the election to refocus the public attention and redirect the potential explosion, it will happen and he will find himself very hard to keep control. this is the widest gender gap among top companies to disclose information so far.

it is three times the u.k. national average. hsbc says the gap will widen to 60% this year. all companies with more than 250 u.k. employees have to disclose their gender pay gap's by this april 4. this bloomberg. you are on. yvonne: time to see how the asian markets are shaping up this morning. those experts coming out of singapore, a big downer there. reporter: we are seeing dollar on the back front. it was already under pressure. taking a look at what is going on in the equity markets. we are focusing on what is happening in sydney to start with. these shares are snapping a three-day decline. we are seeing the aussie dollar

slide 2/10 of 1%. iron ore that below 70. led byares are dragging, chipmakers. japanese stocks facing losses. as the yen sticks around lower. let us take a closer look at what is happening with the yen. it has been a good week for again. -- for yen. the yen is headed for a second weekly gain in three. it could bump up the yen even further. we have ongoing concerns over trade retaliation.

we had white house trade advisor peter navarro saying investors should relax over trade worries, culling trump's position firm but flexible. the latest comments about releases with south korea is looming over lateral trade talks laggard inan won asia today. we had trump hinting that the u.s. might rollback military support for korea in order to ul. trade pressure on soeu the company will temporary -- temporarily reduce exports to the u.s.. we are seeing a casualty there. yvonne: all right. thank you. stick to some of these geopolitical tensions we have been talking about. they had been easing.

we had that headline from local reports coming out of south korea that china may be sending a delegation to north korea this month. the latest with our china correspondent joining us live from beijing. fomois just a case of coming out of china? it seems like everybody wants to talk to kim jong-un these days. reporter: that is possibly an element. experts have said that there is a sense within the power structure here in beijing but there is possibly concern about missing out or needing to at least put china's point forward ahead of these discussions. we got the south korean president likely to sit down with kim jong-un. we have the potential talks between trump and the north korean leader. china has welcomed these talks. it is a long push for these talks between washington and

pyongyang. there is a sense that china will want to direct the talks as much as they can and put forward their case and their interests as well. outhould also be pointed that relations between beijing and pyongyang have deteriorated miserably. it kicked off when kim jong-un is not to have assassinated his uncle, a cute is on the beijing and the north koreans. liaison between beijing and the north koreans. the key is that this time around, china has implemented sanctions robustly. reporters happen up along the border between china and north korea. they have witnessed the impact it has had on the chinese side, reducing the imports from north korea and the trade flow between both countries. that has had a severe impact on the chinese side.

have beentions roundly implemented by beijing. that has caused anger in north korea. this is an attempt to shape those discussions by beijing, they be to ameliorate some of those tensions as we lead up to these talks. it is no see grip that pyongyang has long coveted the idea of having a closer relationship with the u.s.. some have suggested that north korea is looking for bit of leverage versus china. you go to north korea and talk about the chinese relationship, they bristle at the idea that they are china's longer -- smaller brother. there is now a lengthy list of possible candidates to take over as the pboc governor.

reporter: what a role to fill. he is expected to step down officially on monday. the list of candidates are pointing to fill this post. the central bank has been reinvigorated. i will kick off with the bank regulator. he has taken an aggressive stance on things like shadow banking. he has put pressure on some of the chinese conglomerates. they have used credit to expand overseas. he was formerly the governor of the pboc. he seems like a strong potential candidate. there is also the current party he is to run the pboc operations during the financial crisis. he oversaw china's largest corporate bankruptcy at the time. he has had positions in state run banks.

he has a bit of experience on the financial and politics side of things here in china. he is a strong candidate as well. and the top economic advisor to the chinese president. also be given the role of pboc chief though some say that would be too much even for a man of his ability. then there is the deputy governor currently. if he was to take the role that would be continually -- continuity. there are nerves around this transition. those are some of the names in the mix. we will find out the decision on monday, we expect. yvonne: big news on monday. thank you so much. let us turn to japan now. parliament set to put on the reappointment of the bank of and his two new deputy governors. what do we know about their

policies? here with a look. any chance of an early exit? 1 -- reporter: no. the old governor in the two deputy governors who have been nominated, they have a combined 12 hours of testimony. they have ari been in parliament a few times as they get ready to vote on these very important decisions. lower houses of parliament are both going to be voting today. that is what we learned the last 24 hours. when it comes to the main message coming from everybody, waiting for inflation to rise. let us look at the summary. made it clear that they will start discussing exit

around 2019 if inflation hits 2%, as they predict it will. it would be unthinkable to ease stimulus before then. they might be able to adjust yield curve control before then. it would not be a policy change. still too early to even discuss the exit now. there are no theoretical images to what monetary policies can do. boj needs to purchase more jgb's. that is an interesting view to have. boje is a veteran of the who has been there his whole career. negative rates are hurting banks. he has a little blood of hesitation on this aggressive policy. there are some limits to what the boj is ready to do. he is there just support the governor and that is what he will do.

another one of our bloomberg stories points out that the good news from the boj so far is that the scandal surrounding the prime minister is not getting in the way of this important set of oaths. yvonne: even talking about the scandal, we have been talking about it for days now. it is not going away. some guests say that if he goes, it could lead to a domino effect. does it affect the boj? reporter: you are referring to the finance minister. this is very important. let us think about it. office, six year in longest serving prime minister in japan, he was looking to former prime minister's. he survived some big crises in the past. this seems to be different.

business leaders complaining that the japanese people are upset about this. why is this important to the bank of japan? the prime minister came into his latest term and wanted to set up the three arrows. the first arrow is aggressive monetary stimulus. this is one of the keys to mr. kuroda being able to stick through. he is able because he has from the prime minister who has made it a key part of his policy agenda. wer the last three years, have heard lawmakers in parliament and other venues questioning kuroda, questioning if it is appropriate to maintain this stimulus. it could create financial stresses. exit, are not ready to they want more of a plan. they want it spelled out. that is my corona has said we will start disrupting it --

discussing it in 2019. not know how far this is going to lead. this is something that could affect the boj's ability to maintain aggressive stimulus indefinitely. question is, how high up to we have to place the blame when it comes to the scandal? stories.et around the it is available on your mobile device. be sure to check it out. this is bloomberg. ♪

yvonne: welcome. this is daybreak asia. betty: former white house communications director says president trump pay for his new run.mic advisor as a home larry kudlow has the experience and qualifications to partner with the president. that business leaders are going to embrace his appointment because he is a great communicator. he is a great policy thinker. ability.great relate

yvonne: >>. >>the nec has a history that goes back to 1993 set up under firstent clinton, director was bob rubin. the key initial is the sea. the council. it is supposed to convene a diversity of views, foster the debate, make certain that strategy is aired on all sides of the argument. it should not be a platform for political advocacy. under succeeding administrations, the politics have dominated the debate. it is never more so the case than right now. ringing an artist supply sider in who is an advocate for the allow thedoes not

debate to be aired as openly and is frankly as it needs to be. the president says, they like debate. if they like debate, they are stacking the deck. there is no debate in the white house right now. the president's intuition is what rules. be anc is supposed to intellectual check on that intuition. that does not appear to be the case. should the nec and coming director be talking about dollar strength or weakness? >> the view of the dollar is predominantly something that is expressed by the treasury secretary. let the treasury secretary say it. i realize that the first time he was asked to comment on the dollar, he was a prepared and had not read the script.

i think he has read the script by now. he should be the one to make the comments on the dollar. larry has been up and down. he has a right and wrong. we have all been in that position. is lawrence what kudlow going to lean over and say to this president when we enjoyed the twin desiccant -- deficits? he is not going to say, we can grow our way out of that. what is he going to do when the actuality happens? >> he's going to say we need more growth. that taxtrong believer cuts provide the incentive. he has lined shoulder to shoulder with our laugher in that view. larry was championing the corporate tax cut for a long time. i debated him a couple of years

ago on this. he was right out there with that. he argued that this is the answer that america needs to become competitive again. it would pay for itself. yvonne: getting fiery there. stephen roach speaking to bloomberg. do not forget our interactive tv function. you can watch us live and catch up on past interviews as well as dive into any securities or bloomberg functions that we talk about. this is for bloomberg subscribers only. this is bloomberg. ♪

yvonne: this is daybreak asia. man will's richest hold his annual news conference later on friday. the four biggest firms in his property report earnings. let us get to our chief asia correspondent. long been speculating about some type of retirement plan. did you get any clarity today? yearlyr: he has won it news conference downstairs in this building. big event. it is crowded. i hold onto the mic as long as i can to ask as many questions as i can. it is purely speculation. he turns 90 in july. there has been increasing talk that he would announce his succession plan.

2016 that his son has already been running the business for the last couple of years. he has been by his side for the last 30 years. he knows the business. it might just be a technicality or an announcement to make it official. i am guessing his succession plan is in place. this is something that the city in the world will be looking at. a number of other questions. property prices. local media are going to ask his views on the real estate market in hong kong. sold their- skyscraper for $4.2 billion. these four biggest companies are all reporting on the same day. what is expected? reporter: the fact that they are doing all four in one day is feeling the speculation that he is going to use this as a time to announce his retirement.

you are looking at ck hatch and ck hutch asset holdings. they are the biggest listed companies in the conglomerate. all are expected to post net and -- net income rises for the year. they are getting higher returns from the european telecom business. their underlying profit may rise 14%. contributions from australia, canada, germany. good set of results likely. we -- it will be overshadowed if he announces he is retiring. yvonne: we will look ahead to that. good luck with that microphone. our chief north asia correspondent. we are seeing a relatively quiet day to end the week.

we are seeing a pretty mixed picture here. japanese equities down a fifth of 1%. the asx 200 seeing a upside right now. betty: singapore, those dismal export numbers. showing a decline of about a half of a percent. showing a slight decline. in hong kong, set to open as well, pretty much read across the board as you can see. looks like a softer open their in asia. yvonne: that is it from here. market coverage continues next. ♪ mom you called?

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near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver. ♪ >> for all the fuss about trade s, the benchmark in asia set for its best week in a month, reports from new york say robert mueller has subpoenaed the trump organization for documents related to russia. land sales in japan, a scandal shaping up, perhaps putting pressure on shinzo abe in what could be the worst crisis in the country in years. in sydney, i am haidi lun. the view from the top, hong kong's richest man prepares to meet the media as his companies report earnings. this is "bloomberg markets: asia." ♪