♪ >> apple pops after hours on what is described as is a sensational quarter. >> that prompted analyst concerns. iphone sales also held up and forecast beat expectations. >> mark zuckerberg strikes an optimistic note after weeks of fake news and data misuse. facebook is planning a dating game. >> a disappointing message from snapchat. fells tumbling as shares

short and users did not like the redesign. >> hello from sydney. i'm paul allen. this is daybreak australia and we are two hours away from the open. >> it is after 6 p.m. in new york. i'm betty liu. we will be looking at how all the action in wall street will play into the asia-pacific trading day. we know most of the major closed yesterday but they are waking up to good news on apple, as we as mentioned. the iphone sales really topping estimates and quelling concerns that they were going to be some pretty dismal numbers coming out for the iphone x pick up. the markets still closed kind of loosely. the dow falling 64 points. as you can see, the tech heavy nasdaq powering ahead, setting up or perhaps a mostly higher open in asia. paul: yeah, we are off to a reasonably good start in this

part of the world as well. new zealand has been trading for a couple of minutes. up slightly, five points. the kiwi dollar edging closer to $.70. in australia, we are set up for some modest gains as well. futures in australia pointing slightly higher. the aussie dollar dipping below 75%. the u.s. dollar strength story is very big at the moment. checking in on commodities, we have gold easing off on u.s. dollar strength as well, it in for his lowest-priced since december. oil dipping below $68 a barrel. let's get the first word news with jessica summers. jessica: the european union is warning of growing market uncertainty. the u.s. decision to delay aluminum tariffs for another jessica:month. just hours before temporary relief was due to expire, the trump administration says it would allow another 30 days for negotiation.

brussels says business decisions are already being affected by washington insists progress is being made. >> we are having very productive discussions and we are hopeful we can come to a mutually agreeable resolution that will protect the national interests, the national security in steel and aluminum. wilbur ross will be part of a high level trade team heading to china later this week. treasury secretary steven mnuchin will be joined by trade representative who says the trip will be a big challenge. he says the chinese system has worked for them but not for the u.s. and he said it will be good if the problem could be managed to suit all sides. brexit talks resume in brussels later wednesday with the u.k. proposing a new plan for the irish border. the uk's chief negotiator says he wants to move forward quickly on avoiding a heartland front

year when it happens next year. the eu is promising to work around the clock to find agreement ahead of next month's summit of european leaders. south korea has begun dismantling banks of loudspeakers in the demilitarized zone. the two countries agreed to last week's a story summit to end cross-border messages. north korea is also dismantling its loudspeakers. day onnews 24 hours a air and on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm jessica summers. this is bloomberg. paul: thanks. bloomberg intelligence expects gaming revenue in macau to have grown more than expected last month, driven mostly by vips and mass-market players. our chief international correspondent haslinda joines

up from the milken -- us from the milken conference. haslinda: very optimistic and looking pretty good. perhaps this cycle may be better than the previous one. let's get to lawrence. nice to have you with us as always. >> good to see you. haslinda: you are optimistic. why? any one ofher than our expectations. it's growing north of 20%. also, this cycle compared to the previous 2013-2014 in which growth was led by vfp business -- vip business. as operators, that is the lowest margin business. this time around, both massa vip working side-by-side.

vip working side-by-side. our usual margin on that is four times higher than vip. the mass customers, in my experience, is that they are more sophisticated. they are really coming to a new city to experience the different aspects of it, not just to game. that is why that segment of the market is so valuable. for us, that is our bread of butter. that is the main focus. haslinda: how good could you expect results to be this year? lawrence: we are announcing q1 results tomorrow. haslinda: you can tell us. lawrence: we felt pretty good. with margin so much higher than the previous, the mass margin is closer to 40%. vip margin around 10%. it is muchimagine better this time around. also, going through the down we have had a, couple of very tough years in 2015 and 2016. our company was very focused on

cost saving and being efficient. philosophy.t of incentive.t is a big haslinda: your rivals are trying to be more competitive. what is your competitive advantage? how will you come back? five timesacau is las vegas, but at the same time, between the six operators, it is super competitive. what we have always done is we focus on the guest experience. that is why we are very proud to say we we have -- say incentive. we have: the most michelin restaurants in macau, the most five-star hotels, and also the most entertainment, attractions and shows. entertainment and attractions is part of our dna. we like to think of ourselves as much as an entertainment company as we are a gaming company. on his continue to

offer the best possible experience. our customer base, typically when they come to our resort, times asobably two much money as our next-door neighbors. again, that is the segment of the market that we will continue to focus on. haslinda: going to expansion plans -- i want to talk about development within the industry. galaxy bought 5% of wynn. what do you make of that purchase and development? lawrence: i don't say it changes the landscape that much. haslinda: it is not significant? lawrence: i don't think so. haslinda: why not? lawrence: 5% -- i don't see the value of owning 5% of something. haslinda: do you see wynn getting bought eventually? lawrence: again, i don't know. big companyetty and i think their management has done a good job in terms of crisis management in the last little while. again, they are formidable

competitor. how we really focus on is can we continue, how can we continue to be competitive and beat them. i think this year is a special year for us because we are relaunching city of dreams. old and wenine years have the morpheus tower that was one of the last buildings zaza zaza hadid. we have some great products and great experiences prepared for our customers. haslinda: but in terms of wynn, do you see any eventualities -- would it make sense for wynn to be bought? lawrence: again, i think wynn is a big company. i think there has been a lot of changes at their board level. they still have issues to resolve, but i think everybody in this industry is keeping a close eye on it to see what develops. haslinda: you make clear that you are interested in the

japanese market, a casino there. given the scandals playing out and abe's situation right now, do you think the bidding process will get derailed? lawrence: i think last week was a big moment in the ir legislation process in japan because the parties, the cabinet agreed to submit the bill to the dais. it will go there eventually. with japan, there is always a lot of -- i have been lobbying there for over 12 years. i'm very respectful of the process they want to take. we will be very interested. like i said, i just came from japan yesterday. we have the mosti told the people if ito years, five years, 10 years from now, i will be there. maybe not all the other companies, but we will be there because we are so committed to it. haslinda: realistically, when do you see the bidding process taking place because initially,

some people were saying it will happen in the middle of this year? lawrence: no, i think as soon as the bidding process starts because assuming the bill gets passed within this year, they still need time to draft the commissionp a gaming and all the commission and all the compliance, regulatory areas. then, the cities. i think as soon as the bidding process can really start is probably end of next year or even 2020. haslinda: what is the potential of japan's casino market for you? lawrence: japan -- other than macau, japan is the greatest in the lifetimes of all of the operators. so, i think that is why we commit so much effort to it. that is why we have offices, thf all of the operators. so, 20 people on the ground in those places. i think what is important for at a is that tourism

percentage of the gdp is lower than global averages. usually, tourism and percentage it is 10%. for japan, it is 6.7% so there t a percentage of the gdp is lower than global averages. is significant growth just hitting the normal average. i think that is with the japanese government is interested in. haslinda: before i let you go, your license in macau will be expiring. how confident are you of an extension? lawrence: we are very confident because i think we have done the most -- in terms of what the government wanted not just now, but what the government wanted 10 years ago, we have delivered. they wanted diversification on gaming investment. melco has been on the forefront of that. that we98% of the cap spent in the last few years has been on non-gaming. tourism, attracting casino resorts. how optimistic are you?

lawrence: i honestly don't think it will have casino resorts ever. i think the government is looking at horse racing and lottery. we have been to hainan quite a bit. i think either way, we are in a good position because macau will always be the only place within china that gaming is possible. as long as operators like melco continue to deliver on our promises, i think the central government and the macau will continue to support us. hainan really does have additional gaming one day, i for athey will also look chinese operator. who better than us? haslinda: lawrence, thank you for your insight today, of melco resorts and entertainment. we are coming to you live from the milken summit in l.a. back to you. thank you very much,

haslinda. at the milken conference. still more to come on the show. it is the end of an era. we will hear why shane much, haslinda. elliott says the golden days for banking and australia are over. betty: next, we will be live in san francisco to talk more about apple's golden results, better than expected sales numbers. this is bloomberg. ♪

paul: i'm paul allen in sydney. betty: i'm betty liu. you are watching daybreak australia. apple shares gaining in extended trade after quarter revenue jumped 60% to $61 billion. it sold more than 52 million iphones, although the average price dropped and predicted third-quarter revenue of two $53.5 billion. in san francisco is mark gurman.

did this put to rest these fears of slowing iphone demand? mark: well, the revenue is up 14%, but in terms of the sales growth year-over-year, it is only up 3% which is quite a bit under what they have seen in previous iphone super cycles. the concern is absolutely there. the $1000 phone, the price is too high. still, the revenue results overall are looking pretty good. slightly ahead of the guidance. betty: at least enough to propel the stock today and maybe keep the stock going, mark. talk to me about this $100 billion buyback. is that also an area of concern where apple has this huge warchest but nowhere to put it? mark: you know, in terms of concern, before they started doing buybacks and opening the

capital return program, people criticize them for not doing it. now that the are doing it, people are criticizing them for doing it so it is a lose lose situation for apple, as is usual. $100 billion is double than the usual metric of $50 billion annual increases in the second quarter. they have been very clear they are allocating as much as they and putting the rest the use. $100 billion could buy a company like tesla, netflix. they just feel like that only they don't need to spend that money on a competitor. that has been their strategy for a while. they don't take those big risks. for apple, it has not shown to be that necessary. paul: mark, just getting back to the iphone sales, not as disappointing as perhaps some expected. but, is the market reaching saturation for massively

expensive phones that offer new features of questionable value? if so, where will apple look for for future growth? are there any future lines that might drive that? mark: iphone growth is clearly slowing. i don't think we will get to a point where iphone sales are tipping any considerable amount, but it is notable to see the year-over-year growth is slowing. if you look back on the holiday quarter a year ago, the year before the iphone x, that was slow growth as well, 1% to 2%. clearly an issue, but apple is touting its profits and revenues so i guess it does not matter to them. paul: what about some new products they will be looking to maybe carve or will the home pod be the next big thing? mark: the home pod is pretty much a dud. slow.have been very

on the other side of the coin, it is only in a few markets. the are a few key features coming down the road. stereo surround slow. sound, that have been delayed or not out yet. that can have a positive future but not as of yet. i personally think it will be in their augmented reality headset coming out in 2020. that is where the real growth story will be for apple beyond the iphone. i don't think iphone sales will fall. i think they will stay pretty consistent between 200 million and 300 million units sold per year over the next several years or so. paul: all right, mark gurman, thank you for your analysis on those apple results. you can get a roundup of the stories you need to know to get your day going in today's edition of daybreak. bloomberg subscribers can go to their terminals. it is also available on mobile and the bloomberg anywhere app. customize your settings so you get the news on the industries and assets you care about. betty: coming up, another tech giant -- facebook tries to move past the war of -- the uproar of

data privacy. see how mark zuckerberg plans to keep the company going next. this is bloomberg. ♪

paul: i'm paul allen in sydney. betty: i'm betty liu in new york. as we have mentioned, facebook ceo mark zuckerberg has struck an optimistic tone at the conference.veloper he conference. he says he will keep building apps and tools for users despite the company's issues with fake news and hate speech. i want to bring in sarah frier in san jose who has been following this developers conference. what stood out to you in mark zuckerberg's keynote here? sarah: i think the contrast for me was so incredible. i watched this man for 10 hours in front of congressional testimony and saying the same things over and over. in front of developers, he

completely changed his tune. he is almost like a preacher in front of this -- he was so passionate about the changes he was making. it was interesting to see the difference. be tonly, he needed to developers to believe in a future with facebook again. betty: i'm sure he is so comfortable in front of that audience, sarah. sarah: developers to believe in a future with facebook again. a lot more comfortable. betty: a lot more comfortable than in front of lawmakers, that's for sure. what about this whole dating facebook? facebook is getting into match.com. what is this? sarah: it is really interesting. in response to some of the backlash over facebook's effect on society, zuckerberg has changed the company's mission to be about bringing people closer together and one way you can do that is by setting people up on date. let's listen to him talk about what he says here. mark: it is going to be in the facebook app, but it is totally

optional. if you want, you can make a dating profile. i know a lot of you will have questions about this. i want to be clear that we designed this with privacy and safety in mind from the beginning. your friends are not going to see your profile. you are only going to be suggested people who are not your friends, who have opted into dating, who fit your preferences. sarah: so, he really -- he is talking about doing this in a way that is very privacy secure. i should note this is not something that people use facebook for naturally. it will be very interesting to see if users actually pick this up. paul: it will be a fascinating story is that unfolds. let's go to today's bad news story. snap quarter sales falling short of analysts expectations. users unimpressed by the app's redesign. sarah: i think the redesign is what caused users to not sign

up. their growth was started and advertisers also were not increasing their spending as much as analysts expected. fact, we are going to see that as a problem in the current quarter as well. snap said you should fact, expea slowdown in the growth, which is certainly not what you want to hear from such a young company with so much future potential. snap even talk on the call about how we had already reached -- large numbers. that is not the kind of thing you want to hear from a company that just went public last year. paul: all right, sarah frier in san jose. thank you for joining us. a quick check of the latest business flash headlines. goldman sachs is to pay $110 million to resolve claims that it improperly shared information about client orders in an electronic chat room.

it will pay $55 million each to new york department of financial services and the federal reserve board. goldman will provide regulators with a plan to improve its control and compliance. betty: wednesday could see a big expansion with investors predicting greater volume through the gateway. the pboc says the southbound quota will increase to the equivalent of $6.7 billion. the northbound link rising to $8.2 billion. chinese shares will be included in the global market index next month. paul: former microsoft boss steve ballmer has bailed out of twitter, saying the price was right and does not really like being an investor. he bought 4% of twitter and the shares more than doubled since then as the company rebuilt credibility with investors and advertisers. despite the sale, ballmer remains bullish about twitter in the long run.

betty: next, we will take a closer look at apple's latest results with the guest who questioned the ability to make up the slowdown on iphone sales. this is bloomberg. ♪ we use our phones and computers

the same way these days. so why do we pay to have a phone connected when we're already paying for internet? shouldn't it all just be one thing? that's why xfinity mobile comes with your internet. you can get up to 5 lines of talk and text included at no extra cost. so all you pay for is data. see how you could save $400 or more a year. and get $200 back when you sign up for xfinity mobile and add a new line of unlimited. xfinity mobile. it's a new kind of network designed to save you money. click, call or visit an xfinity store today.

is 5:30 a.m. here in sydney. markets opening in 90 minutes. we have futures pointing moderately higher. i'm paul allen in sydney. betty: i'm betty liu in new york where it is 6:30 p.m. you are watching daybreak australia. let's get to the first word news with jessica summers. jessica: u.s. manufacturing expanded last month at its lowest pace since july. rod material prices continue to rise. supply constraints and fears of trade tariffs. the factory index fell to 57.3 to 59.3. production measures dropped to 57.2, the lowest since november

2016 and the biggest decline in the year. and equally disappointing news on the other side of the atlantic. u.k. manufacturing slowed more than expected in april, the economy's poor first-quarter performance continued. pmi came in at 53.9 from revise in march. a 17 month low. the pound fell against the euro and the dollar. popec continues to overdeliver on its production cuts without put falling further last month. bloomberg data suggest it pumped 43.9 billion barrels a day, down from march. iraniran led the drop ahead of e may 12 nuclear gear deadline -- deal deadline.

traders bet on another rise of u.s. stockpiles. it's been revealed that the investigation into alleged corruption in malaysia's fund includes officials at saudi arabian oil producer. the attorney general says two people are expected of fraud, bribery and money laundering. swiss, u.s. and singaporean authorities are looking into allegations that more than $3 billion were neither did from 1mdb. global news 24 hours a day on air and on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm jessica summers. this is bloomberg. betty: thank you. stocks in the u.s. made a late a recovery from the earlier losses. as we have been reporting, apple stealing the show in after-hours trade. a day where they extended the rally in the u.s. dollar putting commodities under pressure. su keenan with more on the market moves today. strategist are

saying that they are wrestling where where do we go from here. end.se towards the let's go to the market snapshot. a lot of people are asking the caterpillar question. hey, is this as good as it gets? take a look at the dollar. it is a little weak after hours but what a tear it has been on. one of the strongest gains in more than a week. that has hurt a lot of the commodities, which we will get to, treasuries grinding lower. let's go into the real chart of the day. it is entitled industrials at the high watermark. this is between industrials and s&p 500. what you are seeing is the industrial sectors which were very weak sector after we got the weak manufacturing data out on this session. they have been underperforming by the most since june 2009. that is a big story that we saw very much.

let's go into some of the most active or the big movers in this latest session. apple was rising ahead of its earnings announcement. the big surprise -- this is the former coach. they own kate spade which is facing big trouble in sales. they also own a shoe store. trouble in sales and the stock was down as much as 40% and one point. intel writing the love for chip stocks. after-hours, oh, snap is what we will get to in a minute. that is the opposite of apple rising after hours. it gave back some of its after-hours gains as tim cook got on the conference call, answering questions. one of the things he said is he is very bullish on china and the opportunities there. snap hurting after-hours. a revamp of some of the advertising really just

completely dissed by users and investors alike. a losing move for snap. paul: su, let's talk more about the strength of the u.s. dollar. it is certainly weighing on the aussie here and the japanese yen and it has put a dent on commodities as well. su: it really has. it is especially true now with this kind of strength. that go back into the bloomberg. this chart is easy to see. it is called dollar breaks among the three month range. the dollar in decline, moving in the opposite direction. from the interesting company earnings, the big focus this week is likely to be the fed that started their two-day meeting and the dollar. let's go to will because the impact -- oil because the impact on commodities has been negative. oil moving lower in anticipation of wednesday supply data will show a 3.5 million barrel build.

the bulls says the dollar strength, the equity weakness is risk off for them. gold slipping. 2018.g all gains for copper declining. that two-day meeting for the fed not helping gold either. back to you. betty: thank you so much. i will pick it up from here. you mentioned apple earlier. i want to get back to the earnings of apple. as she mentioned, growing up in the after hours on the second-quarter numbers that were not as bad as the gloomiest traditions especially long -- around the latest iphone. with us is bob o'donnell. do these numbers put to rest any of those concerns around the iphone x? bob: i think they do. when you look at those numbers, clearly from the asp, it went down quarter over quarter but it went up quite a bit over --

year-over-year. we side big miss read of some of these component players from asia and the potential impact that was going to have. once again, you have to learn apple becausen they have been able to deliver yet again. 21 out of 20 two quarters or something like that -- 22 applee they have been able to quarters or something like that. clearly, they are doing well. the only thing i will debate is tim cook's comments at the end of the call around the fact that the feature phone opportunity is something they can tap into. unless they really do something different, i'm not quite sure how that happens. i don't disagree with him what he said. there were 500 million feature phones that were sold last year and all of those will eventually become a smartphone. that is probably true, but i don't know if any of those will be in apple smartphone. betty: he was trying to say that the market opportunity is still big and it is not saturated yet for apple.

i want to play for our viewers part of the conference call from call,ok, or the analyst and what he said about the iphone x. tim: customers chose iphone x more than any other iphone each week in the march quarter just as they did following its launch in the december quarter. since call, and what he said about the iphone x. we slipped the launch in 2014, this is the first cycle in which the top-of-the-line iphone model has also been the most popular. betty: clearly, it seems like a winner for them this quarter. bob, you raise a good point earlier, what were we seeing from the suppliers? why was this they're just -- why was there this disconnect? bob: interpreting one of tim cook's comments on the call, he called it a super bowl winner but they did not win by enough points.

i guess the way you interpret that is they would have liked to have seen a little bit more, and therefore, their orders they have given the suppliers may have been higher, but they were misinterpreted and that is why we have this huge disconnect. paul: bob, i would like to play a little more from that conference call about tim cook talking about services. let's take a listen to what he had to say. tim: it is growing at a double-digit number on a year-over-year basis. with that kind of change in the base and the services we have now and others that are working just a hugethis is opportunity. paul: this is something we were talking about with our technology reporter mark gurman earlier. the iphone, maybe it is reaching market saturation.

where does apple look for new growth? 's services the answer? bob: i absolutely think it is. in some of the comments, the notes i made before the hearing came out, the question was how with the services business do in case iphone did not live up to the expectations and services blue the numbers away. as you point out, i think we will see some challenges. the smartphone market worldwide peaked in 2016. apple can grow their share but it is still in a bit of a declining market. the services business is critical for apple because you have a lot of customers who are spending money on a regular basis. it is a much more repeatable business model of buying more and more services from apple. they talk about making more investments into content, so you can imagine more video services. other kinds of services they have planned. i think in the long run, that is the real growth opportunity for apple because at some point like any other market, a device

market in a particular area is going to stall but that services revenue can be ongoing across all of the different devices and the apple ecosystem. paul: the smartphone market peaking in 2016, but are still areas of growth in other markets such as china? bob: absolutely. i think the big deal in smartphones now is about share. it is about taking share from other vendors. you have the big players, samsung. local playershave that have been very strong, but apple continues to be very strong. they primarily sell to was somewhat higher demographic in terms of income, but that middle class is growing in china and throughout asia. i think that is where apple seize this opportunity -- see this opportunity. i think you will see them fight for more share. in the u.s., they are stalled but in other parts of the world,

that is where they can start to make some market share moves. betty: i wanted to turn to another tech company. snap reported their results as well, wow. totally opposite. the stock is taking. were you surprised how badly users took to the redesign? bob: in some ways, yes, and in some ways, no. when you look at social media, they are like fashion companies. you have the celebrity endorsements, discussions and that influences the social media platforms much more than it does other technology type products. look, there is a history of social media platforms that were around and then gone. not to say that snap is going to be gone but these things change much more frequently. we are talking about apple is primarily a hardware company with services. snap calls themselves a camera company. clearly, the spectacle thing is not been doing particularly well. betty: there seems to be a lot of convincing out of spiegel and

company they have to do to convince investors and its users to engage on the site. what do you think they need to do? you mentioned calling themselves a camera company. do they need to reimagine the snap story? bob: the strength of the company is around the service, particularly with young people, and that is a very attractive demographic for advertisers. i think the way they have to build this moving forward is billed the advertising business. they did show some positive front but they need to maintain the users. they need to get them more advertising content so they can build up average revenue per user. the camera think is a distraction, but they do have this plan eventually to get to augmented reality type glasses. front but they need to maintain theif they cane point, it might be interesting, but in the meantime, it is a loss leader and sort of an experiment. paul: bob, not every tech world. needs to rule the

would snap be best served just servicing its niche? bob: that is a great point. we talk about twitter nowadays and people have come to accept that twitter will not be this massive thing but they are figuring out a way to make money at the income level they are at. i think that is in than excellent analogy for snap and the model they need to be looking at. can they find that right model with advertising, maybe with this side business around cameras and their glasses? we will see what happens. i agree. i think part of the problem we have with a lot of these tech companies is we expect them to explode into these enormous entities. there will be a few big guys, but a lot of them will be moderately sized companies and i clearly think that snap will be one of those. paul: all right, bob o'donnell in las vegas. thank you for joining us. still to come, the boss weighs

in on financial misconduct and the bank ing inquiry that has been shaking up in australia. we will hear from shayne elliott next. this is bloomberg. ♪

paul: i'm paul allen in sydney. betty: i'm betty liu in new york. a quick check of the latest business flash headlines. nissan has shocked the auto market with a dramatic sales declined in the u.s. deliveries plunged 28% last month as almost every model in the range fell. ford topped expectations, although sales showed why it is quitting the sedan sector in america. really ford and lincoln that drivers bought more of was the thathe 400,000 supercar cells and miniscule volume. paul: the new mobile app marketing push did not help chinese pizza hut last quarter. sales grew 3%.

the disappointing result set shares down as much as 10% after hours in new york. yum china has struggled to attract younger diners to pizza hut. sales slumped far more than expected. betty: india extending the deadline for buyers to submit bids for the national flag carrier. the official statements as the final date is being pushed back two weeks two weeks to may 31. the government is selling a 76% holding in air india, including its 100% stake in air india express an interest in a ground unit.es unit. air india is struggling with billions of dollars in debt.

it makes the market much more competitive. frome seeing competition smaller banks and even newer business models so much more competitive. we are also seeing a little bit of stress in certain parts of the economy. nothing in the result, but we are watching very closely the turnaround, some of the apartment building in sydney and melbourne. paul: in a broader industry has dullednancials the senses. could you say that could be said for the sector as a whole? shayne: the reality is we have had a good environment for banking for 20 or 30 years in australia. the tide has been rising pretty fast. there is always a recipe for complacency. that is something we watched very closely.

one of the things we stress for us is we are relatively small. i know we get talked about as a major bank. we only have 10% market share. we don't have the industry highest returns. i think - we cannot be complace. paul: you also talk about getting rid of legacy retail business in the asia-pacific, you sold the life insurance unit. other sales forthcoming? shayne: we still have a couple of partnerships in asia. we have minority equity stakes. we are looking at those but in terms of operating businesses, no. via large, the reshaping and recent litigation of our bank is done.y paul: the royal commission into banking is ongoing. so far, you have emerged relatively unscathed. are there any bombshells we can expect? shayne: i hope not. it is really confronting thing to watch.

nobody is proud of what we are witnessing in terms of the worst failing and evidence of misconduct, but we are learning. we have made mistakes. we have made some mistakes in the past and we are working hard to a, to fix them up, but more importantly, make sure they don't happen again. betty: that was shayne elliott speaking to paul in sydney. watch us live, see the past interviews on our interactive tv function, tv . you can also dive into any of the securities and bloomberg functions we talk about, plus being part of the conversation by sending us instant messages during our shows. this is for bloomberg subscribers only so check it out at bloomber tv . this is bloomberg. ♪

betty: good morning, i am betty liu in new york. paul: i'm paul allen in sydney.

you are watching daybreak australia. let's get a quick update on the markets. is yuan trading for almost one hour now. --is yuan trading for almost one hour now. --new zealand trading for almost one hour now. we have futures in australia, meanwhile, also higher, modestly by 1/10 of 1%. more broadly, the japanese yen continuing to show weakness against the u.s. dollar. the u.s. dollar being particularly strong over the past few days. that has been weighing on commodity prices as well. the 10 year dipping below the 3% figure. let's get more on what we should be watching as trading gets underway in asia again after the public holiday. adam is here. the aussie dollar under pressure dollar, from the u.s. but up the reserve bank dollar, but up the reserve bank keeping rates at hold. pushing expectations of a hike even further into the future. adam: off the back of the rba

statement yesterday, there is no reason for them to change their stance. in that case, rates are at hold for the foreseeable future. barclays penciled in a third quarter and fourth quarter height from the rba this year. that is what we are seeing. what is interesting is we have seen depreciation in the dollar. as you can see in this chart, it shows you how those rate expectations have been getting further and further out into the future as this decrease in the dollar is -- has led to more people in that bearish camp. consumption remains constrained. people have needed to borrow for very high asset prices, including houses in australia. the economy is constrained from a number of fronts. indeed, nobody could see anytime in the near future where the rba will hike, in which case puts pressure on the dollar. betty: i want to talk more about apple and the after-hours trade.

it is popping as we have seen, but earnings season generally overall, that is not been reporting the positives in terms of share price reaction. what is happening? adam: it is remarkable, really. you have had so many good earnings and has not -- have not had that positive sentiment in stock prices. we are hearing from a number of different investors about how this signals a lot of fully priced value in the market at this point. even as equity volatility levels have come back down again and plenty of cash on the sidelines wanting to rebuy. we heard from jpmorgan, strategists in the market today, saying there is a lot of cash waiting to come in. it to be another $50 billion. there is appetite to get back into this market, we are just not seeing in these earnings numbers. paul: all right, adam haigan, thank you very much for that. you can check out some of the

charts you just saw. it is on gtd on the bloomberg terminal. that is almost it for daybreak morning. this yvonne and betty are up next with daybreak asia. morning. yvonne: earnings coming from apple. it seems like for all this doom and gloom and concern about the iphone x, tim cook for now has eased some of those concerns. they raise the earning guidance and looking better for the next quarter. they believe it will gain 2.9% when it comes to unit sales. it is far from that super cycle everybody was projected. we will hear from andy catherine. he says investors are making a big risk on the iphone services revenue, but we did see the 30% growth. still too slow in his eyes. betty: that is right. in a few minutes, we will also be getting south korea inflation data. michael jones is joining us.

he will talk about three risks the market, including decelerating global growth. paul: all right. plenty to look forward to in bloomberg daybreak asia. that is all coming up next. this is bloomberg. ♪

we're live from bloomberg's asian headquarters. welcome. the top stories, pacific it equity is set to gain after trade resumes after mayday. treasuries fell. apple is hopping after hours and what they describe as a sensational quarter. are $61 billion. are $61 billion. arey: and snapchat chairs stumbling. users did not like the new