♪ yvonne: 7:00 a.m. here in hong kong. i am yvonne man. welcome to "daybreak asia." top stories, asian stocks headed for a big open. oil rebounding after president trump pulls the u.s. out of the iran deal. allies regret the decision to reimpose sanctions. betty: from bloomberg's global headquarters i am betty liu in new york. the u.s. and china in a heated wto clash on trade. saying beijing is acting like alice in wonderland.

black panther helps disney to an earnings beat. isner confident the fox deal will go ahead. ♪ betty: we had a lot of volatility in the oil and equity markets on this will he, will he not, pull out of the iran nuclear deal. he is going to. i want to pull up a gtv chart to show you where volatility was not that huge. it was here in the cbo etf, the vix index that measures oil prices or how much volatility there is in the oil market. it was interesting that throughout the day there was some action. volatility dropped after that announcement was made.

it indicates perhaps that much of this was already priced in. president trump already hinting in tweets and otherwise he would be leaving this deal. makes you question why some had thought it would be possible he will not. looks like for the volatility they price that largely incorrectly. when ita bit of a yawn comes to market reaction. we saw how telegraphed this announcement would be. we still have yet to see what these sanctions will look like. they put out this 90 day, 180 day window for now, before they reimpose those sanctions. is that enough time for the european allies to renegotiate a new deal? is iran going to cooperate? those are key questions we will be looking at. betty: very key questions. those will be on the minds of investors.

not a lot of uncertainty in the equity markets. we saw gains and losses and ended mixed and flat on the indexes. let's take a look at the other markets and how they traded. we saw oil prices coming back up 1.5%. gold ticking higher. the dollar, strengthening as rates rise. that took a little bit of a dip. of jamie dimon and his talk of a 4% yield, we saw the 10 year at 2.98%, near the 3% level. yvonne: this is how we are set up for asia, pretty mixed and lackluster. the nzx 50 pretty flat. we are not seeing a lot of fluctuation when it comes to japanese futures. dollar-yen not doing a lot, despite gains with the dollar

recently. still hovering around 109. take a look at what we are seeing in the aussie. following a drop in commodities leading up to this decision. the kiwi, 0.69. favoring the stronger greenback. the canadian loonie seeing weakness and the krona as well. this is starting to spread. indonesia, the rupiah. when it comes to stocks and bonds in indonesia, but in america, more pronounced. the mexican, down 9% in three weeks. the countrye peso, asked the imf for $30 billion in financing to help stem this five-month rout we have seen. it forced the central bank to hike rates three times in weeks.

seeing weeks of gains. we are watching as we see more strength coming through in this stronger dollar story. let's get you caught up with the first word news. jessica summers from new york. >> president trump has spoken by phone with his chinese after xi jinping spoke with kim jong-un. the second meeting between them in less than two months. kim made a surprise visit. improvings tides are rapidly. quashedd the u.s. have the wto. entered theey have realm of alice and wonderland, where white is black and up is down. china lashing out against terrorists on $150 billion of

chinese terror -- exports. financial markets have dropped gradual interest. he told derek tightening has proceeded without disruption to financial market, but he warns some investors may not be well-positioned for rate hikes. some investors and institutions may not be well efficient for rising interest rates, even one markets broadly anticipate. future economic conditions may surprise us. >> australia's forecasted budget surplus in fiscal 2020. they say that relies on optimistic wage growth. hastreasurer scott morrison

steps for low and middle income earners and modest giveaways. the average worker's pay package rose by just 10 aussie dollars a week. global news 24 hours a day, on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am jessica summers. this is bloomberg. ♪ president trump and did not mince his words in pulling the u.s. out of the iran deal, calling it one-sided and horrible. pres. trump: in just a short period of time, the world's leading state sponsor of terror will be on the cusp of acquiring the world's most dangerous weapon. therefore, i am announcing today the united states will withdraw from the iran nuclear deal. yvonne: let's bring in joe sobczyk, bloomberg congress

editor, joining us from washington. walk us through what the rationale was from the president for ending this accord. he mentioned national security, but we are pretty short on examples. as hee criticized it, long has, as a one-sided deal that benefits iran. hisid make several points, reasons for jettisoning the deal. itber one, he called defective at its core because it did not address iranian ballistic missile development nor its influence on conflicts arising in the middle east such as in syria and yemen. it would allow, because some of the terms expire in a decade, it would allow iran to continue its pursuit of a nuclear weapon, and that would trigger an arms race in the

middle east as other countries prepare for that eventuality. he hoped these punishing sanctions that are being reinstated in 90 days would force iran to come back to negotiations and perhaps get a better deal, at least from the u.s. standpoint, to address those issues. yvonne: we heard from the iran president rouhani, saying they could achieve the benefits of jcpoa without the u.s.. is it still relevant without the u.s.? joe: in congress the reaction is split, as you might expect, largely along party lines. trump'ss decreed actions as impulsive and the wrong strategy for the u.s. republicans for the most part back to the president. dealwere critical of the

when it was negotiated under president obama. universally applauding the president. there were a few notable exceptions. is on the sidelines in this. there was not much they could do to do so. i want to turn to the north korea situation. what did the president say about north korea in the upcoming summit? including thengs, fact mike pompeo is on his way down and probably has arrived now to north korea to meet with kim jong-un to set up groundwork for a potential summit, as early as this month, between president trump and kim. president trump said the time and place has been set for the meeting, though he did not

define what those would be. he also hinted pompeo would be negotiating the release of three americans being held in north korea. he continued to express optimism there would be a summit, and that they could accomplish something with that summit. again, few details on that. betty: joe sobczyk, our bloomberg congress editor in washington. let's look at how markets responded to all this geopolitical news. su keenan with market reaction. jitters, but it came out the way it was expected. let's go into the market snapshot, called, trump dumps the deal. the dollar moving lower in extended trading. big focus on the treasuries, 10 year, hitting close to 3%. jpmorgan warning of 4%.

new york traded crude back above the $70. we will get to the gyrations in a few moments. what you see is that on those have dimon comments, you the banks move higher and utilities cratered like pg&e. in the middle, comcast took a hit. the bid for fox, going forward, they have secured financing. a lot of analysts say, if they do this deal, it will set a huge behemoth with $170 billion in debt. that was a wake-up call for a lot of investors, who bailed on the stock. let's go into the bloomberg. gtv is where you can find these stocks. look over here, february, march, april, it has layered onto a volatile year so far.

as you know, the many allies urged trump to stay in. he decided to get out. it has yet to be seen the impact that will have. yvonne: let's talk more about jamie dimon and his warning on 4% yields. what does that mean for the direction of oil moving on from here? comings like we were close to reaching 3% on the 10 year yield. we took a dip at the end of the session. chart,'s go to the treasury volatility tumbles as yields climb. the 10-year is the white line. almost at three. we have volatility moving lower. what dimon is saying, it could cause more volatility, in a way we do not fully understand. talking about what it will mean when the fed raises rates.

he says, buckle your seat belts, we could be at 4%. that had a ripple effect through the market. let's go to the oil story. the countdown to this iran decision has pushed oil from the highest we have seen in november 2014. we are heading for $71. intraday -- i will put up a two-day chart, where you can see the intraday gyrations before the decision was announced. there were a couple different what president trump have said to the french president. cnn thought they would be delayed. all of that calls -- caused a knee-jerk fall in oil prices. almost an unchanged situation as a result of this decision. into some of the ramifications, there are concerned how this will affect our relationships with allies, what it can mean for price.

$80 andl could be at more by midsummer. stay tuned. yvonne: of course, the president's iran decision our top story. subscribers go to dayb on your terminal or on your mobile in the bloomberg anywhere app. we continue to look at the following from the u.s. decision. we speak to daniel hynes about the outlook for oil. he still sees crude topping $80. betty: plus, disney's black panther roars past earning estimates. this is bloomberg. ♪

yvonne: this is "daybreak asia." i am yvonne man in hong kong. betty: i am betty liu in new york. oil had a whipsawed day, thanks

to the iran nuclear deal. forecast is quite bullish. i want to bring in daniel hynes, the senior commodity strategist for anz. we mentioned earlier your $80 ast for brent was barrel and i believe for wti crude it is up $79. we sticking to the forecast after what you heard today? daniel: absolutely. i seeidifies the issues pertaining to the market over the next six months or so. was nuclear deal itself, not expected to result in immediate impact on markets, but certainly investor sentiment leading up to that. response for me was not

surprising over the past few hours. certainly looking forward now. the market looks extremely tight. --h more sensitive now doubt now to the negotiations president trump will undertake. decision -- of this we were showing a chart earlier about how the vix index for the oil markets was pretty flat after this announcement, indicating i guess there were large expectations this would happen. how was the market set up for this? -- before this? blind toou have to be be unaware of the likelihood of this coming true. it has been building for some time.

post the comments from trump, represents a fair amount of ambiguity. markets, really unsure where to go. the next week or two will be really key for investors to see where this will be -- whether this will be a tough negotiation or if things will work out quickly. we have seen this and other areas, the u.s. sanctions on reaction ina fast the aftermath. it is sort of a wait-and-see environment, but certainly, the risks are very high. yvonne: it seems they could go either way. what should we watch out for when it comes to the barrel front with iran? europe is not involved in

sanctions, how much crude supply could come off of this market? i think that is where the issues are. when you look bad at the original sanctions placed in reducingtalked about pricing sanctions, which held u.s. dollar accounts, unless they significantly reduced their imports for iranian oil. there was no number around what significant means. 190 day in every process as well. there is ambiguity about what it will mean in terms of exports from iran. our best guess is we will still see some iranian oil flow, particularly into china, but i think it is a real issue around whether european entities cannot import oil, and the subsequent

impact to third parties. we will seess is, 300,000 barrels a day impacted. asarly not as big potentially one million barrel a day rise we saw post the iran nuclear deal, but still significant amid a backdrop where we have falling venezuelan supply. -- supplied -- global we are seeing inventories down for much of this year already. does saudi arabia stand to gain? are they likely to step in? that is an interesting dynamic. obviously they have been concerned about the attacks from yemen, supposedly backed by

iranian forces. on the political front, probably not in agreement with the move by president trump, but certainly from an economic sure theye, they are want to see oil prices if they want to repair the budget and ultimately diversify its economy. they have made hints around 90 barrels -- $90 a barrel. ultimately they are more concerned about what the impact of significantly higher prices would be. i suppose it is a little unsure. $90 a barrel, $100 a barrel, would affect demand. intowould eventually come the market and supported if we saw those types of price levels. you, daniel hynes,

joining us from sydney. this is bloomberg. ♪ bloomberg. ♪

♪ hired in extending trade. comfortably beat wall street estimates, now a bit lower here. and a themeer" parks offset a decline in their tv business. what were some of the big surprises in the earnings for disney? wouldknew "black panther" be a big movie, $1.3 billion worldwide. a 29% jump in the studio profits off what was a pretty good year last year, too. that led to a big beat on earnings and sales. the marketsaw reaction, seems it has been quite positive, given what we have seen in the earnings and the film business.

the stock itself has been down more than 8% already. why the disconnect we are seeing in the market? chris: it is the tv business. today'seeing even in numbers, a continuing trend. cable subscribers, people are cutting the cord. we have programming costs still rise. theyy have the solution, are investing in the new, online streaming services. they still had one last month month,n, five dollars a but that costs money. on that up toes $180 million this fiscal year. markets are seeing that in seeing a transition period. yvonne: still confident about this at disney-fox deal, despite what we have heard about comcast. chris palmeri, thank you for the breakdown on these disney earnings. we talk more about jay powell

saying financial markets understand the fed's rate hikes and there should be no surprises. the details up ahead. this is bloomberg. ♪ his is bloomberg. ♪ mom, dad, can we talk?

sure. what's up, son? i can't be your it guy anymore. what? you guys have xfinity. you can do this. what's a good wifi password, mom? you still have to visit us. i will. no. make that the password: "you_stillóhave_toóvisit_us." that's a good one. seems a bit long, but okay... set a memorable wifi password with xfinity my account. one more way comcast is working to fit into your life, not the other way around.

yvonne: 7:30 wednesday morning here in hong kong. a little bit foggy out there. betty: it is 7:30 p.m. tuesday here in new york. markets closing mixed after being rattled by the announcement from president trump on the iran nuclear deal. i am betty liu in new york. yvonne: i am yvonne man in hong kong. you are watching "daybreak asia ." u.k.ance, germany and the addressed president trump's decision to pull out of the iran nuclear program. the u.s. will reinstate sanctions on the islamic

republic, that will open an uncertain new chapter for the middle east. deal, negotiated under the obama presidency, horrible and one-sided. pres. trump: at a time when the united states had a -- had maximum leverage, this disastrous deal gave this regime , a regime of great terror, many billions of dollars, some of it in actual cash. a great embarrassment to me as a citizen and to all citizens of the united states. iranian atomice energy organization to be ready, so if necessary, we can begin our industrial enrichment without any limitations. until implementation of this decision, we will wait for weeks and hold talks with friends and allies and other signatories of the nuclear deal. those who remain loyal to the deal will talk. >> malaysians go to the polls on

wednesday. prime minister najib razak is it seeking a solid victory to move beyond a corruption scandal involving state investment fund 1mdb. he denied wrongdoing and was cleared by his own attorney general, but it triggered a political comeback of a former leader. argentina has asked the imf for financing to help settle a rout that threatens to derail economic recovery. the president said alone would help avoid a crisis like argentina has faced before. he did not say how much money , buteing sawed -- sought it is estimated at $30 billion. deadly virus have been confirmed.

a team of experts will head to the region wednesday to the congo to stop the dirt to -- the disease from spreading. ebola virus can spread quickly. supportays they need for kilauea. called theey have white house and the emergency management agency. has spewing from kilauea destroyed more than two dozen residences. global news 24 hours a day, on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am jessica summers, this is bloomberg. ♪ yvonne: jessica, thank you. marketslk about asian after the president officially confirmed they are pulling out of that iran deal.

the nzx 50 pretty flat. a lot of uncertainty on wall street, ending lackluster. sydney futures pointing to modest gains. nikkei futures losing ground, 25 points. dollar-yen, a safety haven bid for the yen. take a look at oil, a bit of a bounceback, up 1.75%. we have been paring losses. 1310 holding above announce. we coulditical risks, see bullion at $1500 a year -- per ounce. the dollar story, we are seeing weakness in the asian session. yields getting closer to 3%. that dollar strength we have seen as of late certainly hitting emerging markets.

let's look at commodity sensitive currencies. after that announcement by the president, the impact on oil prices, you can see pretty much all red across the board for the aussie, the kiwi. for the canadian dollar, a touch lower. the loonie is just up slightly. krone, that is also trading higher. for emerging currencies, affected by the dollar. the rates rise we are seeing in the u.s., you can see across the board, a mixed fish in -- a mixed session at this point. powell has sent a clear message to investors, concerned they are undermined by steady rate hikes. he says as long as the bank moves in line with expectations, markets will be doing fine.

kathleen hays here with more. what did jay powell say kathleen: -- what did jay powell same? kathleen: he starts out by saying the relationship between the u.s. reserve, financial conditions, the countries affected, this is the topic of his paper, subject of research lately. he says in the beginning of his speech the conclusion some have drawn, the fed policy has been hitting some emerging markets hard, has been exaggerated. in fact, he said that so far, policy normalization has not disrupted global markets. let's listen to one of his key phrases. said policy normalization has proceeded without disruption to markets and participants' expectations. figures seem well

aligned with policy keeper expectations. kathleen: he said it is in line with their forecasts, made every three months. another sign things are on track. he also said normalization, monetary policy tightening in advanced economies, the fed, maybe the ecb, should be manageable for emerging markets. let's listen again. >> i do not dismiss perspective risks from global policy normalization. some investors and institutions may not be well-positioned for rising interest rates. future economic conditions may surprise us, as they often do. kathleen: that flies in the face of people saying, when you look at some countries, emerging markets have been reacting to the fed raising rates, the more

bond yields rise in the u.s., the more that affects currencies and spills into emerging markets. in 2015 going into 2016 when they were getting ready to tighten after the financial crisis, they said they were not worried about this, but it remains to be seen. it is a tricky time for jay powell to be overseeing the fed and in a sense, global markets. set of new policy, tools, that have never been used. yvonne: it is just a coincidence we see turmoil in emerging market economies. they was just talking about argentine peso, the mexican peso. the fed keeps raising rates and the u.s. 10 year trades upward toward 3% again. kathleen: one of our bloomberg stories pointing out, hitting the 3% yield has taken any sense of emerging market bonds

remaining bullish, taken that out of the market. we are seeing that more of a selloff. 2018 is the worst year for market bonds since 2013. let's look at a chart. see how the premium over treasuries has been plunging. steadily getting lower as the fed has pulled back on rates -- on stimulus, pushed rates higher. this trend is clearly in place. argentina requesting a $30 billion imf credit line to stem this five-month rout in the peso. -- they hiked rates three times intense days -- in 10 days. this story is getting bigger and bigger by the day. yvonne: kathleen, thank you. australia's government trying to

woo voters with the promise of tax cuts. is covering the release of that federal budget, which came out yesterday afternoon. we knew we had weeks leading up to this. were there any surprises out of this budget? paul: often there are surprises, but not this time. pretty much we found that everything we needed to know before it began. we had a tax cut, that was well flagged. for low ton a year middle income earners. there will be no 37% threshold anymore. that will be eliminated. $41,000arning between and $200,000 by 2024 will be paying the same rate of tax.

2019, 2020, [indiscernible] only $2.2 billion. mentioned, a strong set of numbers. the government will take to the election. there will not be another election before polling day. we do not know when that is. betty: this budget relies on important assumptions, right? paul: it does, they all do. the key assumption in this case is wages growth. there is an expectation wages and grow 2.75% this year 3.25% by 2020. of evidence a lot of that happening at this point. those are questions i put to the treasurer and the finance person.

let's hear what they have to say. board weacross the have consistently forecasted conservatively. that is why we are presenting better than expected outcomes. that has happened again in the presentation of this budget. we will continue to because shows. the surplus is based on optimistic assumptions about wages. it is based on attacks on pensions we will pass in parliament. it is based on what may or may not be a temporary spark in revenue, based on global conditions. the surplus is based exclusively on one change, which is bringing the tobacco tax forward. it is on shaky foundation. paul: the government has been quite conservative on the iron price, 50 five dollars, that

has not changed for some time. they have not come unstuck on their forecast just yet. allen,thank you, paul tracking the budget. washington and beijing remain far apart on trade following high-level meetings last week, according to wilbur ross. his comments came as china and the u.s. clashed at the world trade organization. tom mackenzie joining us from beijing for more on this clash. no sign of rapprochement from these sides? tom: not yet. we heard from secretary ross. there was still a considerable gap between the sides. they talked for 30 hours in total, and had not made much progress in closing that divide. apart ishem quite far the way he describes it.

interestingly, we got the chinese take on these talks. this was in a conversation stephen engle had with a former prettyficial, who gave a blistering take on trump team negotiators and their tactics. take a listen. is unfair -- give me this, give me this. that is not a way of negotiation. president trump is sending out a team of barking dogs. >> steve mnuchin and wilbur ross. >> i have full respect for american colleagues, american but they are overly aggressive. he did say he is optimistic there might be a deal between the two sides by the end of the year.

as you referenced, there was a spat in geneva at the world trade organization. accusing china of living in the realm of alice in wonderland over its claims the u.s. was pursuing protectionism. china accusing the u.s. of undermining the trade system. certainly the tensions between these two sides remaining. yvonne: the rhetoric from both sides it seems quite escalated. where do we go from here? what can they do now? we are all firmly fixed on this deadline, essentially a deadline, of may 22, after which president trump can initiate these $50 billion worth of tariffs. he has threatened an additional $50 billion after that and china said it would retaliate.

you have heard the vice premier and the top economic adviser to president xi, to be in washington the next few weeks to continue investigations. that is what wilbur ross points to as a positive, there have been talks on the details of these tensions. that is something that potentially lays a framework for them to move forward. he is hoping to make more progress on that. we heard president xi and president trump in a phone call talk about north korea, but also trade tensions as well. president trump optimistic in his tweets and the readout of his phone call about where the trade relationship between these two countries could end up. many say the north korea situation could be something that proves a catalyst in terms of resetting the relationship, if the summit between president trump and kim jong-un goes well, and if we get moves toward denuclearization on the

peninsula. potentially we could be in a better place for a trade deal between the u.s. and china, which is inextricably linked between the geopolitics. washington would put more pressure on pyongyang. positive comments at least from president trump on his relationship with president xi. yvonne: we just learned president xi met with kim jong-un for the second time in a couple months. something to watch for, how these talks come out. thank you, tom mackenzie. up next, geopolitics in the currency market. this is bloomberg. ♪

♪ betty: it looks like we just had recordd year, selling a

$75 million, a matisse, at the auction. it is the rockefeller collection. now taking bids for a monet. matisse artwork sold for $75 million. high-end artwork still an investment for high net worth. at $70 it was estimated million. we have exceeded that already. we will see how the bid goes through. seems like an electric night at the christie's auction. the dollar held onto its gains after president trump said the u.s. will pull out of the iran nuclear accord. analysis. welcome back to hong kong. ms. iran deal, what implications will this have on the market? is it more de-risking flow to

the dollar? >> we think so. we saw in the run-up to the announcement the oil price was coming off, a bit risk off in the market. the dollar-yen was under pressure. we think it is paving the way for dollar gains. we have bullish on the dollar for some time. finally we are seeing redoubling of dollar and yields. i want the pull up this chart, this gtv chart. we see this oil and dollar correlation, not negative, to what we have been seeing. the three have been tracking quite closely to each other for much of this year. how much longer can this last? kamal: the oil story is also a supply story. in terms of where the dollar has been, we have been concerned by the dislocation. the dollar has historically been driven by macro -- we see very

much a game of catch up. has been the dollar has further lengths to go. differential between u.s. macroeconomic growth and european growth in particular. yvonne: we have seen much of the action in em. we heard from jerome powell em can handle rising interest rates. what is the selloff? idiosyncratic, like what we are seeing in argentina, mexico? kamal: i think it is idiosyncratic to some extent. the narrative was, em can withstand a steady fed rate hiking cycle, remained relatively benign in their own policy normalization. now you have pressure on the policy and outflows. that will be pressure for these emerging markets. we do not think it is part of currencies.ssure on

there are pockets of weakness which i think are being exploited at the moment. i want to ask you about the g10 currencies, the pound. it seemed all but certain we would the rate hike by the boe. now it seems certain we will not get any rate hike at all this week. might be on boe hold for several months. what is your outlook on the pound? kamal: when the carney comments came out, a lot of head scratching. the unreliable boyfriend narrative coming out again. weak. was halifax house numbers were week. -- weak. there was a growth reduction as far as the u.k. economy is concerned.

we see further macro and political headwinds, particularly with the brexit negotiations and failure to reach an agreement on trade, agreements with that you -- with the e.u. is it the end of the tightening cycle? we have to wait and see the weakness, see if it is a real slow down and momentum. betty: that leads me to the euro, seeing fresh lows for the year. we have seenas dollar strength. what is your prediction for the euro? kamal: further losses in the euro. we think 115 by the end of q2. there has been this policy diversions. the ecb has been relatively benign in its move.

we think somewhat of a slower pace, july rather than june. looking at the flip side of this story, we hang on to the view we have a repatriation bid to the dollar which will start to materialize the next weeks or so and that should propel the dollar higher. there is a significant amount of non-dollars overseas held by corporate. that will be repatriated by the fiscal package the trump administration announced. betty: we will leave it there, bank of america merrill lynch director. more ahead on daybreak asia. this is bloomberg. ♪ ♪

♪ plenty more ahead in the next hour of "daybreak asia." we returned to the jpmorgan global summit in beijing. that is coming up in 15 minutes from now. betty: plus, the outlook for a

start up with a former jpmorgan chairman. 8:40 hong kong time. this is bloomberg. ♪ ♪

♪ 8:00 a.m. in hong kong, we are live in bloomberg's headquarters. i'm your yvonne man for your welcome to "bloomberg asia." asia's market start to call the run iran nuclear deal. food prices rebound on the decision. the u.s. is giving allies 180 days to get out of the oil deal. betty: from bloomberg's global headquarters, i'm betty liu, it's just after 8:00 p.m.. jay powell says markets gotten the message on the fed' rate hike pasts and there shouldn't be any surprises. asia's -- malaysia's election,

we are going to be live. ♪ yvonne: we are watching the oil price after this pullout of the iran deal. also pulling out, the election happening. polls just opening at the top of the hour. we have to think -- he has to think president trump for the oil prices and how that will boost malaysia's growth and inflation expectation. he's arrived a corruption scandal, a slump in oil prices. he is counting on this turnaround in the economy to extend his coalition. we have been talking about the results. it is a divided opposition, but

the results seem to be too close to call. betty: we will be watching closely. speaking of elections, we are watching a handful of primaries in the u.s. closely watched elections in west virginia and ohio likely to give us clues as to how the midterm elections are going to go. in the meantime, let's get to the first word news with tom mackenzie. has spokenent trump by phone with his chinese counterpart after she jinping's talks with kim jong-un. the unannounced meeting was the second between the asian leaders in less than two months. kim made a surprise visit to beijing in march. ties are improving rapidly as north korea seeks talks over its nuclear program. china and the u.s. have clashed with the -- at the wto. washington staging claims to be

protector of free trade has entered the realm of alice in wonderland, where white is black and up is down. china also lashed out against threats to slap tariffs on chinese imports. a you spokesperson says the geneva meeting was extraordinary in its intensity. polls opened in malaysia the election, where the prime minister is seeking a solid victory to help him move beyond the corruption scandal surrounding stay investment fund one mdb, which has denied wrongdoing and was cleared by his own attorney general. the scandal triggered the political comeback of the former leader, who leads the fractious opposition coalition. australia's forecasted budget surplus of $1.6 billion in fiscal 2020, that relies on optimistic wage growth. the budget for the coming year offer tax cuts below and middle,

earners. retirees, and modest giveaways for health and science. the average worker' pay packet growss by 10 aussie dollar's a week. global news 24 hours a day powered by over 2700 journalists and analysts in over 120 countries. i'm tom mackenzie, this is bloomberg. betty: market «. open,es heading to the but the rebound in crude after the president pulled back and out of the iran nuclear deal. the latest from julia, joining us from singapore. >> that oil price is going to be center, particularly when we see the australian energy players open up in about 10 minutes time. just opening up to the downside of around the 10th of 1%. tom just talking about the australian budget. most analysts we have spoken to

think it could be positive for equities. on the open, a lot to do with we see in the end. crude,a look at wti rebounding after falling about 4.4%. of my 1.7%, but still holding around $17 a barrel. the malaysian ringgit is very much in focus. we are awaiting the malaysian election. after yesterday, falling to a four-month low against the u.s. dollar. there has been a lot of pressure against market currencies. it rallied ahead of the election today. also worth noting, in the bond space you are seeing indonesian bonds being slapped. indonesian stocks hit hard yesterday, as well. let's look at the stocks we are watching. cicada coming through -- cicada coming off of the bell -- takeda coming off of the bell.

as you can see, losing all of yesterday's gains. toyota in focus ahead of its earnings, basically saying the strong yen is going to impact. we could see a revenue decline for toyota, the first time in a year. cba in focus, it has come through with its profit of 2.3 5 billion aussie dollar's, they ae reporting a rise in homeowners. billiton up, getting a boost in oil. marketssee oil rebalance in 2018. yvonne: president trump did not mince his words in pulling the u.s. out of the iran deal, describing it as rotten, one-sided, and horrible. >> in just a short time, the world's leading state sponsor of

terror will be on the cusp of acquiring the world' most dangerous weaponss. therefore, i am announcing today that the united states will withdraw from the iran nuclear deal. yvonne: let's get to our senior international editor, joining us in hong kong to talk about what is next. there was going to be a 90 day window, 180 wind down period before they do reimpose these sanctions. is that going to give enough room to negotiate a new deal? >> the first thing is the sanctions. president trump wanted there to be the highest level of sanctions imposed that halts about $40 billion in aircraft sales. of time is some period that gives openings and the

allies are hoping that there will be some way to salvage this deal. they still support it, they heavily lobbied president trump. it would be complicated to try to do this. iran has said they will not stand by any confrontation with the u.s., that they will take action as needed. there is a space, but at the same time, the u.s. is talking about sanctions and heavily imposing sanctions, rather than talking. betty: president trump's new isional security advisor going to try to pursue a broader deal to address those concerns. could we see a renegotiation occur? >> it would be very collocated. partly because iran does not have incentive to negotiate. the allies have been working on the site agreement. president macron talked about

that around the issue of ballistic missiles and regional conflicts. yet again, it is hard to see that happening very quickly. while they may have an opening before the sanctions are actually reinstated, this is the toward. u.s. is going it will be extremely confiscated to try to do this under these conditions. details, we await more what are the immediate potential implications of this action? >> there will be more market volatility. analysts are telling us we are already seeing the effect on oil. the broader geopolitical implications are potential, as well. with potential talks with the u.s. and north korea slated to star as soon as next month, it raises the question on how the

north korean leader may view this. a study shows president trump will walk away from deals he doesn't like. the president himself has said this shows he sticks to what he believes and he complained the deal, and blasted it since he was a candidate. he is saying he has to stick by that. coming just before, we are to hear the details about that meeting with north korea, it could have some effect there. depend on whether they can try to negotiate some kind of site agreement what happens to the deal -- side agreement what happens to the deal. yvonne: our senior international editor. chief jay powell sending a message to investors, concerned they are being undermined my steady rate hikes. he says as long as the central banks move there while telegraph and are in line with expectations, they will be fine.

kathleen hays is here with more. what exactly did jay powell say and why? kathleen: he was at a conference and he was addressing this question of -- practically in terms of what's happening with the federal reserve as it continues to hike rates, and in terms of research. what are the concerns, what could happen? he isnds to me like pushing back against the notion that fed rate hikes are starting to spill into emerging markets and they will continue to do so and it will have an effect. speech, i think you get this sense. a lot of research he has put together does show that in the past, the fed policy has not been such a big driver. fed policyppears the normalization has not disrupted global markets.

>> fed policy normalization has proceeded without disruption. market participants expectations for policy. the red symbols in figure six, seem reasonably well aligned with policymakers expectations. kathleen: he also went on to say that he thinks market expectations for rate hikes are in line with the fed, not surprising. very transparent. he said normalization in advanced economies should be manageable for emerging markets. let's listen. >> i do not dismiss the perspective risks imitating from global policy normalization. soon, investors and investments may not be potential -- ready onesotential rises, even that markets anticipated. economic conditions may surprise us. kathleen: he spoke to the

audience, he is concerned emerging markets developed high deficits. that makes them more vulnerable to the fed when it hikes. and they have a lot of leverage. there is a lot of concern. betty: just going to show you some life pictures out of tokyo, prime minister shinzo why they welcoming president moon jae-in for a trilateral summit meeting with the chinese premier. you can see moon jae-in right there. this is the first time in seven years we have seen this summit, given the fact that they used to be a new meetings, but there has been a lot of tension when it comes to disagreements over territory and past wars. we haven't seen anything like this since 2012. one of the big issues that will wkwardcussed is this a item, which is north korea, and

what to do leading up to this meeting between president trump and kim jong-un. betty: we heard from the president himself, that he is putting together a summit as we speak. certainly as you mentioned on the top of the agenda. still ahead, polls are open in the malaysian elections. spencer coverage begins later this hour. we speak to one of the most prominent business leaders. rhl ventures managing partner joining us in about half an hour. up next, we are back to the jpmorgan global china summit in beijing and speak to the banks asia-pacific chairman and ceo. this is bloomberg. ♪

♪ this is "daybreak asia," and yvonne man in hong kong. betty: i'm betty liu in new york. jpmorgan global china summit is underway. stephen engle is standing by

with the man who oversees the bank's asian operations. next -- our first guest after what was a whirlwind day on day one, is nicholas are losing, the chairman of asia-pacific for jpmorgan. thank you for having us here at your summit. what is your gauge of investor sentiment given the 2000 plus delegates and participants you have? we have financial normalization going on, but geopolitical risks and trade tension between china and the u.s. what is it you're reading -- your reading? >> people are willing to understand and learn more about what's happening. people attending today are more focused on what's happening around china and trade tensions play a key role in everything

that happens from a geopolitical point of view affecting china. is an important thing investors are trying to gauge. they seem to be optimistic from an economic point of view, whether it is global, domestic, asia-pacific everybody is looking at what's coming. is there anything that may affect investment opportunities and gauging what may happened? >> the shop today is trump pulling out of the iran nuclear accord. what do you eat expect -- what you expect? higher oil prices, a potential for tens of billions of dollars worth of deals with iran, possibly going by the wayside. a doubt there will be additional volatility, one thing we will probably have a lot of allies negotiating with the next move is.

it will generate a lot of speculation about what is going to happen to suppliers. i don't think it should be dramatic, it depends on what type of sanctions happen. it is not like it has been telegraphed -- hasn't been telegraphed. this is something the market has been assessing and see how to play forward. while there will be short-term volatility, it depends on how it plays out in the next few weeks or months. >> at a time when we got geopolitical risk in asia was coming down, we get this. we also get more escalating rhetoric between china and the u.s. on the trade front. there was no publicly announced progress, and they seem to be far apart on demand. do you see geopolitical risk rising? >> i don't think it is necessarily rising.

if you look at what is happening in north korea and south korea, i think that is quite significant. week,in south korea last i got a chance to understand firsthand what is going on and what the feeling is from the south korean side. they have quite a bit of intel. one of the things that surprised me was the amount of support that the south korean population has, in terms of trying to make this work. they really want to make this work. i think they have a lot of affection for their counterparts on the north, there is a huge amount of interest in helping the nation rebuild. whatever solution comes, probably will also involve a lot of help and aid flowing from south to north. anything that creates value is probably going to be a key part.

>> do you see a strong potential for a peace dividend for all? >> i do. anything that creates the ability in all of asia is good for everyone. the key about this north korean threat is not just north korea. it is the issue of a long-term, and having north korean nuclear weapons would imply that one day you may have weapons in other countries, japan, vietnam, indonesia, what happens after that? that is one of the biggest dangers that our civilization is facing at this point. >> how far along in the planning and potential implementation now jinping jinping -- xi has announced it. we have seen foreign banks potentially taking ownership in a securities firm.

you got out of your security center a couple of years ago. how far along in the planning stage, now that you can potentially have majority control, and maybe a few years down the line 100%? >> this is a process that takes a long time. what we want to do is make sure we can operate in china in the same way we operate globally in any other country. we don't have these ventures in other places. china was an exception. we decided let's clean up the deck, make sure we are prepared for the future. now weed that venture, are in process in setting up oil infrastructure to be able to establish our own securities company in china. that requires a lot of paperwork, making sure we get the right people in place and establish everything. it is good the government has

established a firm meant for the future. as soon as weit can. i don't know exactly how it will devolve. the sooner we can do it, the better. -- howconcerned if you concerned are you buy the concert and -- concerns that have been raised? the practicality of some of the new rules for this majority highrned -- control maybe . how closely were you a part of that? >> we received the material, we shared feedback. being the largest financial institution in the world, we should be in a position where our level of capitalization is an acceptable one. there are a lot of things and clarifications that need to go into the dialogue. littleings to be a

strange in the sense that it doesn't fit in terms of what they are trying to achieve. we are working on this. >> will you have a securities venture sooner or later? >> i wouldn't call it a securities joint venture. a securities company. we will have other investors. >> sooner or later? >> sooner. >> think it's a much. that's you. -- thank you so much. back to you. yvonne: steve engle with jpmorgan asia-pacific ceo. we are back to the global china summit later on this hour. former banker, now vice chairman and president of xp ng motors, to discuss thes outlook for startups in china in about under half an hour. make sure to tune into that. australia's government has delivered a budget it hopes can boost flagging poll ratings ahead of elections due within a

year. the deficit for 2018 and 2019 work out just under 15 billion australian dollars. return to a fiscal surplus seen by 2020 one year ahead of schedule. immediate tax relief for low and middle income earners. that will amount to a seven dollar a week tax cut, which drew criticism from the opposition. the government also promises to do crackdown on tax avoidance by multinationals. betty: australia's shadow finance minister has hinted out. f forpports tax relie working australians. >> we support tax relief for those australians who have been doing tough. there are multiple waves of tax changes being proposed. some are on the never never. we have some changes being proposed which would only come he is reelected two more times. the point we are making is they come in seven years down the track.

we are not going to make a speedy decision in one day on tax changes that come down seven years. we don't know what condition the budget or economy will be in. we are in no rush. we will consider them, but we are not considered of -- we are not convinced about the other texts set to -- tax set. >> i am not going to make assumptions. these think the government has been overly optimistic? >> i am worried the wages growth assumption is optimistic. like $40ad something billion in new additional revenue and charges coming into the budget. we still have record net debt, gross debt over half $1 trillion. the surplus in 2009 was based on optimistic assumptions about wages.

it's based on a tax on ventures. it's based on what may or may not be parking revenue coming from very positive global conditions. it's also based the first surplus exclusively on one chance, bringing the tobacco tax collection forward a year. the budget is built on shaky foundations. we intend to put it on a more sustainable footing. >> the treasurer in the lockout last night, we talked in the past about the effect on the australian economy. there doesn't seem to be any provisions for future shocks. for example, trade were between u.s. and china. >> the point you make is well made. what we have here is a budget that gives away a lot of the temporary improvements in revenue. we have seen this story before. we are going to give genuine, sustainable, responsible work

relief to lower income earners. we have to make difficult decisions elsewhere in the budget. which is what we are going to do by closing down tax loopholes which fail. ♪ mr. elliot, what's your wifi password?

wifi? wifi's ordinary. basic. do i look basic? nope! which is why i have xfinity xfi. it's super fast and you can control every device in the house. hey! let's basement. [ grunting ] and thanks to these xfi pods, the signal reaches down here too. so sophie, i have an xfi password. and it's "daditude". simple. easy. awesome. xfinity. the future of awesome. ♪

a: 30 in singapore, half hour from the open of h: 30 in singapore, half hour from the open of trading. i'm yvonne man in hong kong. betty: i'm betty liu. you're watching "daybreak asia." we are getting the results in one of the primaries in the pivotal state of ohio. the x consumer protection bureau achieved has the percentage in the ohio governor percentage. this is in the democratic primary and there are concerned about the finish. more on the radical progressive side, a lot of concerns he may have a chance to bm -- to beat

him. let's get to the first word news with tom mackenzie. tom: france, germany, and the u.k. regret president trump's decision to withdraw from the accord to curb iran's nuclear program. the u.s. will reinstate financial sanctions on the republic, opening up chances for the middle east. the deal,ed negotiated under the obama presidency, horrible and one-sided. >> at the point when the u.s. had maximum leverage, this disastrous deal gave this regime , a regime of great terror, many billions of dollars, some of it in actual cash, a great in barents -- embarrassment to be -- to me as a citizen and all

citizens of the united states. >> i ordered the iranian atomic energy association to be ready if needed so we can begin our industrial enrichment without any limitations. until implementation, we will wait for some weeks and hold talks with friends and allies, and other signatories of the nuclear deal. those who remain loyal to the deal will talk. tom: jay powell says financial markets have the message on financial interest rate increases, and shouldn't be surprised. he said tightening has proceeded without disruption to financial markets. investors may not be well-positioned for rate hikes. >> i do not dismiss the prospective risks emanating from global policy normalization. some investors and institutions may not be positioned for rising interest rates, even one markets anticipate. future economic conditions may

surprise us, as they often do. anthea: argentine --tom: argentina has asked for financing to help their peso andh route in the threatens to derail the economic recovery. president maurizio macri's said the loan would help the crisis like the ones argentina has faced before. he didn't say how much money is being sought, but a bloomberg source put the figure at $30 billion. president trump approved a disaster declaration for hawaii with the eruption of a volcano destroying homes and prompting evacuations. the governor asked for help from the white house and emergency management agency. lava has destroyed more than two dozen residences on hawaii's big island. global news 24 hours a day powered by over 2700 journalists and analysts in over 120 countries.

i'm tom mackenzie, this is bloomberg. ♪ betty: an update on your markets. we continue to see a stronger dollar. crude continuing to rebound. let's get the latest with julia and singapore. julia: we are starting to see a little bit of a downside to these markets. the dollar stronger for a third session. that is seeing movement on the yen relationship. the nikkei is down by a third of 1% in early trade. the korean market also being weak. we have upside. coming from the asx 200. we have the australian federal budget and most analysts telling us it is quite positive for equities, particularly in the consumer focus, tourism, and infrastructure. if we look at currencies, we have started to see the ringgit have another decline. it was trailing higher, but that

means it is holding around those four-month lows ahead of the malaysian general election. we saw election stocks close well before a fifth consecutive session. around halfnline in hour. we have a quick look at the bond space. several bonds in the region mostly being sold off. the other big story is the oil markets. what you arechart, starting to see crude hold around $70 a barrel despite having 4.4% slump in the u.s. session as we heard the latest from president trump saying they will withdraw from the 2015 iran accord. we will see what that means in terms of sanctions. this blue line showing oil production is starting to come under pressure. let's look at some of the energy producers. you still have oil holding quite strongly. santos leading the gains, up

2.5%, petroleum also looking good, along with oil surge. .npex supporting the japanese by half of 1% it is one of the only positive performers in the session, in terms of sector moves. it is earnings season, we have numbers coming through from grain costs. falling the most on record. they are down by 17.5%. it has fallen as much as 19%. the lowest we are seeing after flagging for years earnings less than animate -- analyst estimates. foreshadowing adding to the fact that you are seeing a downturn coming through. polls have been open for just over half an hour in malaysia's general election. the outlook appears promising for the prime minister, despite an uncomfortable past two years. in his strongest

position since a narrow victory back in 2013, with economic growth at a three-year high and his position relying on a 92-year-old former prime minister. let's go to where chief correspondent has been sending my. -- has been standing by. >> it is an election like no other. it is turning out to be a personal fight. issue is rising costs among the people who feel they are being squeezed. the gsp was introduced three years ago, causing a lot of pain among the people. also an issue, rising unemployment among the young. educated young finding it difficult to get a job. let's get a perspective from a managing partner. costs are causing --

perhaps having an impact on investor sentiment. what is your take? me, we're still seeing strong economic fundamentals, regardless of what's happening in the elections. growth is up 5.5%, inflation is about 3%. while unemployment for the youth is low, it is still higher than singapore. you still see a lot of opportunities in malaysia. are many companies who are looking to relocate from overseas to malaysia. policystors look for antinually, does it mean reversal on the policy? has a lot of continuations in the koran policies that the

government is doing. when you talk to the business community, they are looking for this to continue. , a hot topiclicies at the moment. it consists about 20% of government revenue. that's how the government is run, and what fund. >> what should the top priorities before the government that comes into power next? >> there are three parties nailed down for whoever comes in next. one is economic growth. 5.5% is among the best in the region, it needs to be pushed further. twoinvestment -- point investment. the economy is doing well, and investor confidence is growing in malaysia itself. the government has already promised to invest one billion

ringgit in the ecosystem for international, there will be a continuation of that for people to have confidence in the market. issue at this election is the one mdb corruption scandal. beenvestor sentiment affected? moved up to malaysia, everyone was talking about when and the b. now the issues have been identified, lessons learned. >> investigations are still ongoing. there is still no resolution yet. what everyone is looking for is moving forward. and how to continue to invest in malaysia, help out malaysian companies export, help them grow. the focus is more on that. people are tired of hearing

about it. we just want to grow and contribute, we want to invest. ?> what is the biggest risk >> when there is a policy uncertainty, especially on the fiscal side, that brings risk. if you see downgrades, it will impact the investor community. we still get a lot of investment from hong kong, from the middle east, the u.s., they read bloomberg. they see what has been happening and what happens in malaysia. >> malaysia has talked about additional cancellations, which is being adopted by the rest of the region, including economies like singapore and hong kong. how can malaysia compete? >> one of the big things that happened is the launch of digital trade free zone. there has been a big that for a

lot of companies to focus over here. companies why they want to move your, malaysia is costly. i've worked in hong kong, i have worked in singapore, there is a skill that there needs to be improved on. i have built a local team. i am as good as my colleagues, they need the right training, the right investment. friends, myseen partner who move back from hong kong to malaysia, you see a green game from people who want to contribute. it helps the economies were not doing too well. there is always foreign country by us. >> thank you so much.

from our racial ventures, managing partner -- ritual ventures. people, 1532 million million registered voters. back to you. yvonne: thanks to rhl managing partners member. up next, we speak to the president of an electric carmaker and find out how he is hoping to grab a bigger slice of china's keep the market. this is bloomberg. -- china's dep market. this is bloomberg. ♪

♪ this is "daybreak asia," i'm betty liu in new york. yvonne: i'm your yvonne man in hong kong. the emergence of a few startups

in the past few years. raise $1.6itions to billion this year and beat out the tesla. let's go to the global china summit, were stephen engle is standing by with our next guest. the former chairman of asian banking operations. guest, formerr jpmorgan banker, now you have gone into the brave new world of electric vehicles, joining the company in march of this year. how are you going to survive? you said there are like 300 ev startups in china. what will set your company apart? >> it is a big opportunity, the market is about to take off, particularly for china. xpeng is different in

its dna. we are a technology company. if you look at the 300 plus startups, 90% were started by former car manufacturers, or supply-chain businessman. they are mostly focused on making an electric car out of gas car experiences. the other 10% is the technology side, most evolving players. but they have the strong background, founders are media executives. we are probably the only company backed by founders, technologists, product manufacturers. r&d, and wee on focus on innovation in software and intelligence. >> how are you going to get the

manufacturing expertise as good as manufacturing? a lot of joint ventures are good. you do rise to the top of the 300, how are you going to get that expertise within the likes of volkswagen, gm, deodorant, they will be pushing their -- yoda, they will be -- to go to toyota. . >> what is different about her approach is we intentionally slowdown launching timetable process to make sure we have enough time to test and perfect the manufacturing products. we are the first ones among the startups to get the license to manufacture, to mass-produce, and to be registered on the road. we have vehicles produced for that. however, we decide not to sell these vehicles to the consumer. we have tested it out on the

road for almost a year. model was the improved version of the first model we mass-produce. >> presales have started, how is demand? well, our product sold out in less than 10 days. >> the price is going to be key, it goes high against tesla, or lower against mass producers. newan also coming in with a one. the leaf was selling at $35,000 and was to high-priced, are you going low or high? >> our price has not been announced. we now have a price range between 200000 and 280,000. u.s.6,000 >> yes. in china, electric vehicles get

subsidies as high as about 10,000 u.s. dollars. you have to look at a low income range, one third will be covered by subsidies for the government, hich will lower the car to $16,000. >> do you expect the competitive landscape to get fierce? the government is also going to lower the tariff barriers for foreign ev's to come into this market. you have 300 competitors. there must be consolidation. >> of the 300 i mentioned, only three will be able to deliver a car into the market. the rest is more than one year away, it is tight. three will actually have cars in the market. >> maybe their game is to get valuation up themselves. >> they are just getting a lot

of publicity after the auto show. look at who and when can get their cars on the road. >> how about fund raising, $800 million raised, we are hearing $1.6 billion expected? in this business, it requires resources. capital is the best resource we have. we are on track to raise over $1 billion this year, in addition to the rounds we have announced. i am very confident we will be able to raise sufficient capital. >> you plan to sell the cars to the general public eye the end of this year? >> yes. we aim to deliver, not just sell. we will launch the actual sales the fourth quarter of this year, and deliver by the end of this year. >> coming to a market closest you, then maybe abroad later. sending it back to you. many more interviews coming up

from the jpmorgan global china summit. yvonne: looking for to that. from there to come jpmorgan summit in beijing. at 11:10 a.m. hong kong time we talk about china's one belt, one road project with danny alexander. then at 2:30 p.m. we speak to the former u.k. prime minister. don't miss those big interviews, coming up. this is bloomberg. ♪

♪ asia, this is "daybreak i'm betty liu in new york. yvonne: i'm yvonne man in hong kong. reported earnings things scheduled on wednesday, stronger earnings expected for the ceo. at 1:25 p.m. tokyo time we have to look out for the earnings, earlier than we are used to. there will be key questions analysts will be asking during the call, in particular when it comes to competition in the u.s. take a look at the function on the bloomberg. put in the ticker for toyor, and you can -- toyota. you can see in the orange bar, the u.s. is the largest market, north america one of the biggest for toyota. we have seen intense

competition, they rely heavily in this market. the key question is if you continue to spend to boost incentives or preserve your margins, given the fact that all of these other japanese carmakers are slowing transition into china, toyota has not followed suit. the u.s. is a pivotal market and one to watch out for. yvonne: those incentives enabled bad behavior among consumers. they get used to it than you can get yourself out of offering these incentives. it seems like to go to is getting hit on many fronts. in particular, the stronger yen is hitting the carmaker. demonstrates how much the dollar has fallen and the yen strengthened. it is almost a direct correlation. you see revenue take a hit based on that. it is continuing to languish over the last quarter. that currency is going to be a major headache if it continues

to strengthen fo toyota. yvonne: they have to start flagging these declining sales in the domestic market. one to watch later this afternoon. let's take a look at what's coming up in the next few hours on bloomberg television. what are you watching today? >> the malaysian elections. you had a few guests already. sophie will also be joining us. details about one mdb. that will be an interview that will raise a lot of issues. a lot of things to talk, that takes place in about 10 minutes. and other guests are coming up live on the ground in kl. the other big story is donald trump pulling out of iran. we didn't see a reaction in oil prices. close to 3.5m million, now it is down to 2.5

million. it is now back up closer to 4 million. where does that go? does it fall back, do we step in? what are the options for the saudis? or do they step back and do nothing? do they step in and potentially mess with the math? earnings, as well. the philippines also out with earnings. the ceo joins us later to discuss their plans and results. betty: certainly a lot to watch ahead. thank you so much. asia," it from "daybreak market coverage continues next. stand by for bloomberg markets. this is bloomberg. ♪

9:00 a.m. here in hong kong. i am david ingles. >> and i am haidi lun here in sydney. this is daybreak markets asia. ♪ david: crude prices rising in the asian session, after trump scrapping the iran deal. they have 180 days to get out. haidi: voting is underway in malaysia after the prime minister najib