you hundreds of dollars a year. plus, get $150 dollars when you bring in your own phone. its a new kind of network designed to save you money. click, call or visit a store today. haidi: it is 9:00 a.m. here in sydney. i am haidi stroud-watts. welcome to "daybreak asia." top stories this wednesday. tesla dropped. elon musk may take the company private at $420 per share. character tweet boosting his personal fortune by more than $1 billion. ramy: from bloomberg's global headquarters, i am ramy inocencio in new york, where it is past 7:00 p.m. on tuesday. washington confirms tariffs on an additional six teams billion dollars of chinese goods. beijing has vowed to respond in kind. at the movies, disappointment from disney. despite the success of avengers,'s 2 and the

third-quarter earnings went off script. haidi, here we go, kicking off "daybreak asia," looking at where the markets ended in the united states, it was one of confidence. whatever that is -- whether that is misplaced or well-placed remains to be seen. tariffs onut 25% that extra $16 billion worth of goods we were expecting from china. but you know, we definitely have , going back and forth between the u.s. and china because china said they will continue to retaliate. haidi: yes, absolutely. you say this is a misplaced sense of calm we are seeing in the market. volatility is low. we are close to record highs for u.s. docs.

-- stocks. these things do not matter until they matter. a look at where the u.s. closed. the s&p 500 was up by about .3%. were prettythings positive despite the escalation in trade tensions. tesla was definitely one of the biggest stories of the day, of the afternoon, rising some 11% after a halt because elon musk take the he could company private, valuing that at $82 billion. the nasdaq getting a boost by .3%. flipping up the boards, take a look at what is happening in currencies as well as commodities. actuallyberg dollar fell by about .2% in u.s. trade. you can see it there. also people in back a tad. the u.s. tenure at 2.97%. will it take 3%? we will see. that was helped by what is happening in crude.

highest in at its about a week because supply haidi, out of saudi arabia as well as because of those sanctions heading back onto iran. haidi: taking a look at how we are setting up here in asia, it is quite a lot on the data docket today, looking for the indication on trade wars. we have the fx reserves numbers increasing despite the weaker yuan, and certainly, that export picture is expected to show weakness. a rebalancing towards imports is what we are expecting. this is how we are setting up in this early part of the session. unchanged for the sydney futures picture after the rba left their -- where it has been. a sobering statement when it comes to the economic growth situation.

futures looking like a little bit of downside, and seoul looking at a bit of upside. stepcount of that next forward, the escalation in the trade war situation as well. that will play on the aussie dollar. that the pboct has spoken to major chinese banks, telling them to avoid herd behavior and momentum trades in the yuan. can they keep, this going? chinese stocks gaining the most in two years yesterday. that optimism spreading. ramy: let's get to our biggest story in the united states, and that is tesla and elon musk considering taking the company private and what would be the largest leveraged buyout ever in history. it all started with a tweet in which he stated that funding is secured at $420 per share.

that drove the stock upwards, but it was briefly halted. momentum.ot stop the the stock closing 11% after trading resumed. that is well below mr. musk's $420 figure. we are joined from san francisco by bloomberg's tesla reporter, dan hall. all the folks we have been talking to, including david kudlow, this is going to be quite a big up challenge to get is actually done. >> it's really interesting. in the pastked about wanting to take tesla private. it is not a surprise for people covering him that he has been frustrated with the challenges of being a public company ceo. he said he's trying to forge a path forward that would allow everyone to focus on the long-term future, but where the financing is coming from, how he gets this through, the

valuation he wants, what happens to tesla's debt, it is not at all a done deal yet. ramy: he said it is all about creating the environment for tesla to "operate best." is this the better path for tesla to grow out of the watchful eye of investors? dana: i think it is surprising. tesla is still a high-growth company that has a lot of funding needs. they want to build the factory in shanghai, make a lot of products, so they will need an enormous amount of financing. musk said financing is secure, but there was no details about what he means by that. has he lined up a lot of other financiers that we are not aware of yet? haidi: on the financing front, what does this also mean given that musk has only very recently said the company would be cash flow positive by the third quarter? dana: i think that he is just -- tesla has been a publicly traded

company since their ipo in 2010, and i think he is just tired of the noise, the short-sellers, the scrutiny. even just doing the earnings calls takes an enormous amount of time, and he is trying to figure out a way to go private for a long time and perhaps return to the public market in the future, kind of like what dell did. i do not think it changes their plan to become cash flow positive or profitable. it would lower the amount of scrutiny they are under if they do not have to do earnings calls a recorder. there is a separate camp of investors, tesla watchers, who say it will be best for the company is elon musk steps out from the leadership role, right? if you want to concentrate on his flamethrowers and actually have someone run tesla like a profitable company or a company that wants to be profitable.

dana: his plan paves the way for him to step aside as ceo and just be chairman of the board and chief product architect, but remember tesla does not even really have a clear number two or coo at this juncture, so it is hard to see him stepping away. on twitter, he responded to someone that nothing would change and he would still be ceo. haidi: thank you, dana hull. it has been very eventful. out drama largely playing on twitter. but get back to our other top story of the day. the united states confirmed it will impose tariffs on chinese goods as of the 23rd of this a previousvering on threat made by the trump administration and following the $44 billion worth of tariffs already in place. tom mackenzie is watching all of this out of sean high, -- shanghai. we heard about talks being set up, but what happens now? tom: yes, it is far more about the action than the talks, isn't it? this is the second of this. 25% levels.

not unexpected. we got a lift of 279 chinese products that will be hit with these tariffs, including things like steam turbines and motorcycles. we should expect china to respond dollar-for-dollar pretty quickly, today in fact, with their own $16 billion with of tariffs on u.s. goods. they made it clear they would retaliate in kind at this temperature. we are looking at the review process in the u.s.. ranging from potentially 10% to 25% on $200 billion worth of chinese goods. it ends september 5. after that, the tariffs could be imports. china has said it has its own list of $60 billion worth of u.s. goods that it would target if those additional 200 with the billion dollars -- $250 billion worth of chinese goods are hit. we heard about potential discussions at the lower levels, but no potential talks at this

stage. it is all about ratcheting up these tariffs from both sides. china in the meantime, has taken additional steps to try and support the yuan. what do we know? is it likely to have an impact? tom: yes, so this was a meeting that the pboc had with about 14 lenders here in china, in beijing yesterday, and they told these banks to avoid heard behavior. d behavior. they said they had plenty of tools. and tryld not step in to mitigate market forces, but they also said the fundamentals of the chinese economy would stabilize the currency, and of course, this comes after the pboc put in place those reserve requirements on friday to make it more expensive to short the yuan. of course, after these comments from a senior researcher, someone very close to the pboc, saying you will not cross the that seven mine. they have done a survey of

traders and analysts in the forex space, and the vast majority do not expect the y uan to cross seven versus the u.s. dollar. of course, that would relieve some pressure on policymakers because what they are concerned about is triggering outflows. they do not want to be back in that position. ramy: i can only imagine the pressure is building on president xi jinping. what are you hearing on this front right now, tom? tom: so this is very interesting. this is unprecedented pressure for president xi that we are getting on a number of fronts, externally and domestically. we have the trade tensions and these moves not just in the u.s., but also in the european union, to raise the barriers to some of these investments from china over concerns about potentially predatory purchasing

china'se of companies. domestically, you have concerns around the slowing economy of course, but also scandals, like the vaccine scandal for children here that triggered protests in beijing. p2pad protests over this lending scandal. people taking to the streets. those are issues bubbling up domestically. you had outright criticism from some academics and pundits about the handling of some policies by president xi and his team, not least the u.s. trade tensions. all of these things are coming to a head. from theset immune pressures even if it looks very at this stage that there's going to be any change to the leadership here. that seems a remote if not impossible likelihood at this stage, but it shows they faced these pressures domestically and externally. ramy: and they will very likely continue. .om mackenzie in shanghai

thank you. first word news with jessica summers. well, the trump administration says it intends to reimpose sanctions on the iranian oil industry in november. it is considering further penalties after that. national security adviser john bolton told fox that any potential waivers will be few and far between. the renewed sanctions are having an effect. daimler is freezing operations in iran, including a tie up with an automaker. speculation is rising that turkey will need capital controls in a bailout from the ims as the lira reels from the plunge. officials had to washington for talks about a jailed american pastor and the sanctions imposed in response. it has been nothing from the government and the central bank, and investors fear president erdogan is blocking a rate rise. big banks are the winners from last year's republican tax cut.

staff, not so much. 23 firms the fed team's most important saved on average $388 million each in the first half. the groups collectively eliminated 3200 jobs. almost 1% in the period. a year earlier, before the tax cut, the growth rate was twice that. facial recognition security will be used at the tokyo olympics in 2020. it will be the first time such a system will be employed at the games. the technology will be installed at all venues and aims to eliminate entry with forged id and reduce congestion at peak times. the technology will be customized to monitor every accredited person, including staff and media. labonte's, 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more

than 120 countries. i am jessica summers. this is bloomberg. haidi: thanks for that. still ahead, we will be discussing earnings of the future with southeast asia's biggest developer. he will be joining us on bloomberg and just half an hour. ramy: emerging opportunities and risks. for outlook for e.m. assets as trade tensions rise. this is bloomberg. ♪

ramy: welcome back. this is "daybreak asia." i am ramy inocencio in new york. haidi: i am haidi stroud-watts in sydney. trade tensions continue to ratchet up. u.s. markets don't seem to care. stocks climbing within distance of record highs. let's get the view from hong kong. here is the global head of fundamental equities and emerging-market equities portfolio manager. do you find it unnerving that we

see the u.s. stocks within striking distance of record highs and at the time we are seeing an increase escalation in this trade war? >> a lot has been already priced into markets, particularly markets outside of the united states. or you would have expected that as the trade wars did not escalate as much as people thought, there would be a bit of relief improvement in place. we will see what happens when the next $16 billion will be put in play, but overall, we have not seen any real escalation, and that is what the markets are reflecting. haidi: i find it interesting that two out of your top three conviction trades are korea and china, the markets most exposed. is now the time to get in,

particularly if you price in the potential for a stronger u.s. dollar, more carnage to come for these emerging markets? fabiana: there is no two ways about it. you either believe there is going to be an escalation in the trade war -- you either believe there will be another $200 million of tariffs imposed against china and then china will respond with investment restrictions or you believe that at some point, there will be some negotiations and this will , bute part of fears nothing will actually happen. and we are in the first camp, where we believe that actually -- the second camp, i am sorry, where we believe that in the end, this escalation will not happen beyond the initial $50 billion, and on that point, you want to look into market that have been hurt in an unwanted way. are faringand korea

reasonably well, and also trade numbers actually are still quite solid. ramy: i want to hop into the bloomberg terminal here and show you as well as our viewers this gtv terminal chart, looking at the s&p 500, near its record high. is at its low for the year. when you're looking at the u.s., when is it not a safety play? damedems like it wins -- if you'd -- damned if you do, damned if you don't, basically. fabiana: if trade tensions were to escalate, if you have earnings being hit on both sides of imported and exporters, you will most likely have a fed that will have to rise rates not growth, but because

of inflationary threats in the u.s. so no one will be safe, but having said that, the u.s. will still be probably the best place for us to invest, if you believe there will be an escalation in the trade tensions and the extra 200 billion. however, if you look at current valuation of the u.s. markets, ,nd you also believe that overall, the situation will eventually dissipate once the midterm elections come, then i overbookedarket is in the u.s. moment orterm minsky minsky paradox comes up in terms of the sink hole forming in the u.s., where people don't see below the surface. do you think this is a situation like that? fabiana: it could as well be. could as well be. that's why if you look at our positioning, in our global funds, we are actually more where wet in europe,

find some really good opportunities at really attractive valuations. we believe, eventually, those opportunities will catch up for valuations in the united states. we still believe in our asia trades. at theow looking strength of the rest are as well, folks have been saying that this might turn by the end of this year. do you hold that outlook as well, were looking ahead to 2019, where do you think this is headed? it depends on what happens on the geopolitical front and a trade tensions. if the situation dissipates, then i would see the strength of the dollar being shorter-lived than otherwise. i would say, based on our best case scenario, you should not see much more strength in the dollar. haidi: i wanted to bring up a

quick chart, which has been the emerging markets negatives of the week as we see the recovery in em stocks in currencies, we are not seeing that play out when it comes to turkey. we have that turkish government bond yield touching 20% in the overnight session. the lira continues to fall to new lows. isolated sort an of example in that em space? and how much worse can it get given that it does not seem like monetary policy is really going down the right track? actually, i do believe it is an isolated case and not related to any of the geopolitical risk is you now, whether it is trade tensions or anything else. it is very specific to turkey. is ayou are seeing monetary policy that is far too loose. pressuresflationary mounting. this is also a country that heavily depends on foreign capital, they need at least $200 billion or more a year. so any concerns that at some

point, they will have to actually how the market close to sanctionspitals -- are obviously rattling investors, and rightfully so. we will have to leave it there. great to have you and those insights. fabiana fedeli. the portfolio manager for that. can interactrs with the charts we have shown using gtv . you can browse those recent charts and catch up on key analysis. save those charts for your future reference as well. this is bloomberg. ♪

ramy: welcome back. let's do a quick check of latest business flash headlines. softbank's business fund leading

in investment into the food delivery operation owned by alibaba. as part of any deal, we are told alibaba intends to merge it with an in-house unit which connects restaurants to the internet. , which is vital burning enormous amounts of cash in a food fight. snapchat parent has reported a first-ever quarterly drop in users, but sales topped expectations come on the news that the saudi billionaire has taken a state. 2% toaverage users fell 188 million. it signals a controversial redesign of the app is still hindering growth. manila group tumbled after forecasts missed the lowest analyst estimate. the second-quarter results also raised fresh questions about its and sellinguying

homes. zillow announced it is acquiring mortgage lenders of america to streamline sales of homes the company owns and to create a new revenue source. still ahead, biggest box office hits were not enough to help disney. more on that, soon. ♪

haidi: 7:30 a.m., wednesday in hong kong, about 30 minutes away from asia's first market open. a beautiful view there of hong kong. we are watching keenly the chinese market, see if they can sustain a second day of rallies after jumping the most in about two years. china trade really being beset line -- the headline, the potential impact of the worsening trade war. ramy: meantime, you are taking a look at the empire state building, across the manhattan skyline. 7:30 p.m. on tuesday in new york, where markets closed up nearly 0.3%. you got your superlative on the china markets, i have mine.

we are only 15 points away on the s&p from a new record high, this of course baffling some folks, a lot of investors, as we look at the new lens of rising trade tensions between the u.s. and china. i am ramy inocencio in new york. haidi: what trade tensions? [laughter] stroud-watts here. let's get your first word news with jessica summers. jessica: washington has confirmed it will impose 25% duties on an additional $16 billion of chinese imports in the next two weeks. customs will begin collecting the duties on 207 product lines as of august 23rd. the u.s. levied similar duties on $34 billion of goods on july 6th, prompting swift retaliation from beijing. china has vowed to strike back dollar for dollar on the latest action. china is said to have made another move to stabilize the yuan, urging banks to avoid

so-called herd behavior in the currency markets. the previous he told lenders it has plenty of tools to keep the yuan flexible, moving in both directions. the meeting came just days after the pboc made shorting the yuan more costly, and policymakers said they would not use it as a weapon in the trade war. tesla shares and bonds soared after elon musk said he's considering taking the company private. the initial announcement via twitter, mentioning a share price of $420, saying "funding secured." that would value tesla at $82 billion. however, the share price failed to reach $420, indicating market skepticism musk could pull off what would be the largest leveraged buyout in history. a government projection says australia's population has broken through 25 million. the bureau of statistics says the milestone was reached tuesday night, sydney time after

11:00 p.m. resident population grew 388,000 people in the last year, 62% of the migrants. the number of australians has doubled since 1970 and six fold since federation in 1901. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i am jessica summers. this is bloomberg. haidi: thanks for that. we are counting down to asian market opens. let's look at what we are expecting. sophie, asian stocks set for a mixed session and the yuan holding on to gains. what could be driving the mood when it comes to asia? sophie: you said what trade tensions, but investors will react to the u.s. tariffs on china, and regional investors might be crossing their fingers after the rally we saw in chinese stocks on tuesday. on the futures board, we are set

for a mixed session in the region, when it comes to what we are watching out for, we have japan's current account surplus expected to narrow in june due in part to a stronger yen, and earnings from names like shisedo, sumitomo metal, and in less than 30 minutes we will get the minutes from the boj meeting. in australia, the rba will deliver a speech on monetary policy, and we are waiting on a policy decision from thailand and trade data from the philippines and china. chinese export growth came in at 11.2% in june. as you can see on the terminal, which you can find in the gt the library -- gtv library. growth is expected to have slow to 10% last month as levies started to bite, denting the trade surplus. if trade slows down substantially, that might prompt faster using from chinese authorities. ramy: in hong kong, two new

listings making their debut at a time when the stock market has been pretty lackluster. sophie: investors aren't exactly stomping -- chomping at the bit, both falling ahead of the debut. 36 companies will have raised about $9.4 billion, surpassing what we saw in completed debuts in the first half of the year. with two offerings today, that to towers, with up retail subscriptions at the lowest since 1959 for an ipo about $3 billion. the big picture, retail appetite for ipo's in hong kong has cooled, perhaps as investors might want to save ammunition with more listings on the way chem'she likes of sino

refinery unit and delivery giant meituan-dianping. head let's > to disney -- to disney. a record-breaking summer at the box office, "incredibles 2" and the latest avengers movie, but to hire not transferred earnings. let's go to a laborer chief chris palmeri. it wasn't the movies, so what was it? chris : it looks like we will never see two animated films, projects that were probably tied to john lasseter, the former head of disney's animation business who stepped down last year, so this is the movie business. there are big winners, and often some losers. ramy: that is showbiz, as they say. ceo bob iger touched on how he put his cash to work during the conference call.

take a listen. >> as you know, fox also has significant stake in sky, the most successful pay television company in europe. the addition of these valuable assets will greatly enhance our position as a global entertainment company with excellent production and distribution businesses in key and emerging markets around the world. ramy: chris, what does this mean for the deal going forward? chiris: what you can read into that, iger says he's still very interested in acquiring the parts of sky doesn't already own. fox is wrapped up. comcast, the other bidder, is not interested, but comcast still has the highest offer for sky, so in a way this is bob saying, that part of the deal is not over, i am still interested. parks what about the business? a bit of a bright spot, especially in asia. chris: the parks over the last

two years has been a real driver of business, as the tv business has been going through technological changes. the new park, a couple years old in shanghai, seems to be doing great. the hong kong park that had taken a little bit of a hit as more chinese customers went to shanghai has also resumed profit growth. haidi: chris, thank you so much for that. l.a. palmeri, bloomberg bureau chief talking through disney earnings. commonwealth bank of australia's record profit run is over after the nation's biggest lender paid the price for a series of scandals and missteps. cash profit fell to 6.8 5 billion u.s. dollars in the year ending june 30th. our finance reporter has been taking a look at the numbers. it was in line with expectations, as we talked about yesterday. emily: exactly. selling off bits of businesses, taking these provisions. theanalyst estimates --

general consensus was we would see this break in profit for the first time in nine years and revenue growth slowing. revenue growth, not a great time for the us trillion banking industry even as you put aside the scandals, the key drivers of growth, the extraordinaire he has price boom, are unwinding -- house price boom, are unwinding. more difficult to make money. haidi: our guest was saying, if you strip out the messiness of this period, it actually beat his expectations. nonperforming loans did not do badly. the rba staying where they are, something that will be around for a while. emily: exactly. i think, not too bad of a result, if you consider the pressure they have been under, and that has to have distracted management time and focus. they are human, despite being ceo's. the fact this is a slightly better result than perhaps some people expected, it does not

overshadow or stop the fact that this is really difficult going forward. they have taken a lot of provisions for a lot of one-offs, but the regulatory environment is going to get any easier. there's still a lot of hard work ahead to ensure this big australian company continues to deliver profits like in the past. ramy: if there was a line chart for trust in this company, it seems like that is at a low as well. how do they rebuilt from that? asic saying they will put in regulators, supervisors within the companies. how do they pull out? newy: well, the commonwealth bank ceo, only in place since april, although he is a longtime commonwealth bank employee, his answer to that is we are going to apologize for what we have done wrong, and we will do things better in the future. but a company the size of

commonwealth bank, with tens of thousands of employees, takes an awful long time to turn around. you can have all the goodwill in the world from management, but making sure those behaviors really changed in the frontline staff is a long job, so i don't think this implosion of trust is going away any point soon. there will be a long, hard slog for commonwealth and asked really a -- australia's other big banks to get back to where they are before. ramy: emily cadman, thank you. a look at the stories trending across the bloomberg universe. bloomberg.com is reporting on singapore's test stock, a taxi stock, which surged thanks to uber exiting the market there. tictoc has tweeted a moment on women's rights in japan. tokyo medical university apologize for giving lower grades to female applicants,

trying to keep women out. terminal scrubbers are reading about what is topping investor worries, thanks to over "vanishing liquidity." check out those stories, trending on bloomberg online or on the terminal. haidi: coming up, we talk to southeast asia's biggest developer, as they reported second-quarter earnings. the president and ceo joins us next. this is bloomberg.

haidi: this is daybreak asia. i am haidi stroud-watts in sydney. ramy: i am ramy inocencio in new york. southeast asia's biggest developer, capitaland, just posted earnings for the second quarter. net income at 605 million singapore dollars after the city tightened property curbs. julia is standing by with the company ceo. takeaway.

-- take it away. julia: that is the key question, the singapore property curbs and whether they have done enough. let's get it over to mr. lim. thank you for joining us. you have seen the property curbs start to have quite an impact. have they done enough to quell demand? mr. lim: i think it is adequate at this point in time. the market has moderated. sales volumes are coming down. but on the other hand, when you look at it on the capital level perspective, we have always been watching this market very carefully. over the last few years, we have decided that we will take, we will underweight this part of the market. we have been reducing exposure to the singapore residential market. with these curbs coming into place, we are in position to look at potential opportunities. juliette: you said in the announcement, you are expecting

prices in singapore to come under more pressure in the second half. mr. lim: yes. if you look at the first two quarters, prices are up by more than 3% on a quarterly basis, so for the first half of this year, up almost 7%. this is a significant move in the price index of the singapore residential market. with the curbs, i would expect it to be moderate. juliette: you have seen quite a lot of weakness coming through in singapore real estate stocks. do you expect the government could impose more curbs? mr. lim: at this point in time, these measures are probably adequate. a lot depends on how the market response to the measures in place. juliette: when you look back at the numbers you just released, where do you see the most growth? what are you most proud of in the last quarter? mr. lim: a few areas. one, how we have executed our strategy. we are happy with the progress we have made.

in the first half of this year, we invested $1.8 billion in two new properties in china, in vietnam, as well as frankfurt, in germany. this, on the bigger scale, is going to reshape our portfolio. juliette: let's talk about your china business. when we last spoke, you said it is about 50% of assets. is that still the case, or are you trying to move even further into china? mr. lim: we have been looking at opportunities in china. we have been recycling as well. if you have been following the company'sies, in the first quarr of the year. the two new malls are management contracts, but the sale of the 20 malls in china allowed us to take back some capital, and now we are investing capital back into china. the approach will still be 50% in emerging markets, 50% in

developed markets. juliette: in the emerging market space, where are you looking at? i know you like vietnam. mr. lim: we still like vietnam. we select china. in china, residential is still a big part of the business. we have at this point in time worthnits of residential, about 16.2 billion rmb. we hand over these units in the second half of this year. thate case of vietnam, are -- we sold about 2700 units not yet handed over, worth about one billion singapore dollars. 30% will be handed over in the second half of this year. we are happy with the progress we made in both markets. juliette: any other ideas you are looking at, particularly in southeast asia? mr. lim: in southeast asia, we have always been monitoring the markets. in singapore, with the recent property curbs, there might be

new situations, opportunities arising, so we are monitoring the space very carefully. we continue to monitor what is happening in malaysia. we have some small positions there. indonesia is a very big market. wewill continue to, again, have a small exposure in indonesia. we will be watching this particular space to see whether we can to play more capital to the market. juliette: you also said you would apply capital to develop markets. you mentioned frankfurt. are you looking at europe more? mr. lim: when we compare all the different markets, europe represents an opportunity where the relative value has been attractive. juliette: when you look at r.o.e., $100 billion planned for 2020, is that still on course? mr. lim: still very much on course. at this point in time, at the end of the second quarter, the real estate we have now is about $93 billion, so we are well on track to achieve $100 billion by

2020. juliette: you don't release a dividend this half, but when you spoke to me last you said you are looking at increasing shareholder value. is that's still the case, still looking to attract a lot of these investors, your shareholders, and please them considering we have seen a downturn in property stocks in the last six months? mr. lim: we are always looking at how we can better optimize our capital structure. the first focus for management, to see how we can improve return on equity. last year, we achieved a .5% r.o.e. on the whole portfolio, so we believe this is sustainable. based on the outcome of the first half of this year, we are very much on track to achieve a more than 8% return. juliette: you retire in december. you told me you might be traveling, but for the broader business, can shareholders be confident capitaland is in good hands? mr. lim: yes. i think we have laid a strong

foundation, a strong portfolio. if you look at the quality of the earnings, very high quality earnings, so we are in a good position. i think we have a strong team of i am quite and confident we will be able to find a good successor to take over the company. my immediate priority is to make sure it is a smooth transition. julie at: what's on your capitaland bucket list the next few months, before you retire? mr. lim: to make sure there is a smooth transition. that will be, the board has made good progress in identifying a good successor. juliette: thanks so much for joining us after the release of your earnings. ramy, that was the capitaland ceo and managing director at capitaland in singapore. ramy: that was juliette with capitaland ceo lim ming yan. some breaking news crossing the terminal, japan's current account balance, coming in a

little less than expected -- ¥1.175 trillion against a survey of ¥1.222 trillion. we can see the impact, yen briefly gaining towards 111, also paring now, heading back across the 111.35 mark there. the trade balance at ¥820 billion. the expectation was for ¥800.6 billion. a little less than expected, the current account balance for the bank of japan. haidi: with the bank of japan, we are taking a look at the opinions coming through from its ended july meeting, the crucial meeting where they tweaked isicy, saying it imperative to consistently continue with powerful monetary easing, saying the 2% target will take longer to hit. also, it would not make powerful

monetary seizing sustainable -- easing sustainable. as we know, the bank should introduce forward guidance for policy rates and strengthen commitment to show public confidence in that strong stance there. talking a lot about the stability of monetary policy, which had a lot of investors, markets seeing this as overall a dovish move, so they can sustain this policy for longer. one member saying flexibility in etf purchase amounts are appropriate. there is more flex a bloody around that, as well as more flexibly around the bond target as well. plenty more ahead on "daybreak asia." this is bloomberg. ♪

ramy: you are looking live at u.s. president donald trump, on vacation this week staying at his retreat in that minster, new

jersey -- bedminster, new jersey, hosting a dinner with business leaders. some lines crossing the terminal. gdp, iton the u.s. could be in the 5% range next quarter, and also saying that companies are coming back to the united states, but the administration has not yet announced any of those. he also criticizes some companies and some people, saying at the dinner that people have billions of dollars offshore. headdition to this, he says sees close to $5 trillion being brought back from offshore. ng a furtherti $2.5 trillion to the back, i do not know if that's additional to that $5 trillion, but certainly throw numbers out at the moment. watching the bank of japan, opinions coming through from the crucial end of july meeting, twe

aking the yield curve control target, throwing the global bond market into disarray for a little while. one member saying more flexibility should be considered, flexible etf buying will help that policy objective of sustainability. so more powerful monetary policy and easing for longer seems to be the theme for the bank of japan, looking to consider flexible asset buying, allowing flexible rates. we have been wondering how much flexibility, particularly to the upside, they are willing to allow for that 10-year. one boj member said the yield might move to 0.1%. really, probably the most interesting summary of opinions you are likely to get from the bank of japan. ramy: as we count to the top of the next hour, a quick look at futures. this is how they stand. nikkei pretty much flat, kospi up 0.1%. a little of a mixed picture

after the positivity we had in the u.s.. the s&p just about 15 points shy from an all-time record. coming up on "daybreak asia," the second hour. this is bloomberg. ♪

haidi: here in sydney, live from bloomberg australian headquarters. welcome to "daybreak asia." asian equities are set for a mixed start, with another positive session in new york. s&p 500 hitting its highest since january. the yuan holding on to gains triggered out of support from beijing. banks urged by the pboc to avoid a herd mentality over currency markets. ramy: from bloomberg's global headquarters, i am ramy inocencio in new york, just after 8:00 p.m. on tuesday. washington confirms tariffs on another $16 billion of chinese goods. beijing has vowed to respond in kind. tesla jumped as elon musk plots

a different route. he might take the company private at $420 a share. haidi: as we have come to expect from tesla and elon musk, a a lot of drama, a a lot of intrigue, but also a lot of skepticism in terms of reaction from the investor community, but regardless we saw the reaction, although not as much as we would expect. maybe that speaks to the skepticism from investors at this point. ramy, looking at the day ahead for asia, lots on tap. china trade numbers, the latest indication of whether this ever-escalating trade situation, we had the further $16 billion of tariffs just announced over the last few hours, whether that tol start bleeding through

the bottom lines on the macro picture in china. ramy: little ripples here and there the last few weeks, things hit in terms of isn's, ppi's, but not the biggest knocks yet, not that we do want to see those. in terms of all the analysts we have been talking to, they say we have to wait and see. the $16 billion we're just talking about today, just the latest nail in this proverbial coffin, haidi. haidi: let's look at how markets are digesting this. we are watching the yen, as we had the data dump out of japan, but perhaps more interestingly, the monetary policy summary of opinions from the last boj meeting at the end of last month. dollar-yen holding at 111, looking to get a bit more detail as to why they tweaked the yield curve control policy. the overrunning sentiment, they tweaked it to allow for more sustainable

longer-term policy. the nikkei, pretty flat start. ntt beat estimates. certainly watching out for implications of trade and impact on asian supply chains for markets like japan and korea as well, ramy. ramy: let's also take a look at what's happening in south korea. we can see the won right now on the move, gaining about 0.5%. the kospi headed the other way, up about 0.25%, just over the 2300 line. nikkeilay, after the plans toeported raise production of oled tv panels 40% next year. samsung may announce a large-scale midterm capital

investment and hiring plan as early as today. samsung electronics up 0.4%. chosun motor also, after ilbo said the company might announce restructuring plans. very busy day. haidi: busy in sydney as well. , not bank, one to watch -- commonwealth bank, one to watch.the record profit run ends on the scandals. up 0.3% in early parts of the day. 0.7429, a bitlar, of a lift after broad dollar weakness overnight. amp one to watch as we get reports from the big banks. commonwealth bank of australia, seeing a little upside. a very messy report, but you strip out the one-time, that headlines, and it was a beat on a number of things, including on bad loans. we continue to watch for that

potential recovery in cba, the worst performer of the big four thanks here in australia. ramy: let's get more from the summary of opinions at the bank of japan, just released from the last meeting. kathleen hays is here in the studio with me. what did we learn? ,athleen: i think we learned this underscores what we saw on the policy statement for the bank of japan and heard from governor kuroda at the press conference. the boj have not made much of a change until they made this tweak to yield curve control policy. one boj member says it is essential to pay close attention to side effects. remember, the boj has been buying so many bonds, there have been times liquidity has completely dried up in the jgb,

japanese government bond market. it was getting to be more of a problem, maybe a lot more of a problem. broadly, another one, the boj overall saying it is vital to make easing policy sustainable, by making it possible for the bank of japan to keep buying bonds by widening your range. one boj member said the long-term yield range of 0.25% will the appropriate. right now it is 0.2% on either side of zero. they talked about introducing forward guidance, that they would keep the easing policy and stimulus for an extended time. another member saying even more flexibility in yield curve control should be considered. i want to show you a chart from the bloomberg library. you can see how the boj tweak, as they call it, i would say a pretty significant change, has artie made a difference. a former range of minus 0-.1.1, plus 0.1, and now a broader

range. not anywhere close to 0.2 yet, but making a difference already. one boj members have flexibility in the etf, exchange traded funds, amounts will be appropriate. they already changed what they are doing, the composition, topix versus nikkei, etc., but maybe even more flexibility down the road. haidi: kathleen, we had japan's current accounts balance out for june. the rebound in the trade balance really played out there. kathleen: it did help, but we saw current accounts shrink a bit, to ¥1.175 trillion. the estimate was for something maybe a little stronger, ¥1.2 trillion. at any rate, people are wondering what's going on. the current account is different from the trade account because it includes payments on services, dividend payments, which they make to overseas investors, the japanese government does.

in the month of june in particular.that is maybe one reason why we see it chongqing . on the other side of the ledger, as you point out, the trade balance has swung into surplus, and that probably counts most, the trade balance surplus. big risk, the stronger yen, if long-term yields keep rising, a potential hit to supply chain demand from the us waiting trade war tensions between the u.s. and china. a pretty decent move. not unexpected. maybe a little lower. the surplus intern account remains, and we will say we -- see where the trade account goes down the road as we see how trade repercussions hit japan. haidi: going to get a look at that with china trade numbers. kathleen, thank you so much. global economics and policy editor kathleen hays with this tranche of data and summary of opinions from the bank of japan. jessica: washington has confirmed it will begin imposing

25% duties on another $16 billion of chinese imports in the next two weeks. customs will start collecting the duties on 279 product lines as of august 23. the u.s. slapped similar duties on to the $4 billion of --$34 billion of goods earlier, prompting swift reaction from beijing, which has vowed to respond dollar for dollar. china is urging banks to avoid so-called herd behavior in the currency market. sources say the pboc told lenders it has plenty of tools to keep the yuan flexible and able to move in both directions. this came days after the pboc made shorting yuan more costly, and after policymakers said they would not use it as a weapon in the trade war. the trump administration says it intends to reimpose sanctions on the iranian oil industry in november, and is considering

further penalties after that. national security adviser john bolton told fox, any potential waivers will be few and far between. the renewed sanctions are already having an effect. daimler is freezing operations in iran. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. haidi: thanks for that. off aceo elon musk set storm after saying he's considering taking the company private. in in in l2 employees -- an ema il to employees, musk said he wanted to operate with as little disruption as possible. the price of $420 a share what -- would value the company

at $82 billion. musk owns about 20% at the moment. he says either way he would not be selling. of's bring in the head technology research, joining us from new jersey. we have come to expect drama and skepticism in equal parts when it comes to tesla and anything elon musk touches. is this something that is feasible, likely to happen? >> that's the big question. i mean, that's going to be the big question in the bull/bear debate, can they get the financing to secure a transaction of this magnitude? the sequence of events, it was a job drop or, even to the -- jaw- dropper, even to the bulls. a transaction like this wasn't on the table even in a massive bull case. right now, there's a lot of

questions that need to be answered. it is a double-edged sword. got past a good quarter, model three production, step in the right direction, now the whole focus of the tesla story becomes, do they go private or not? that will be at the center of this, especially in the coming weeks and months. haidi: dan, i want to throw some sound we got earlier when we spoke with dennis gartman. he said this is all a bit of a game to put the fear of god into tesla shorts. >> this is not going to happen. this is just a game to make sure, to put the fear of god into the shorts once again, which clearly he did. do i think this will come to fruition? i doubt it. i don't think this is going to happen at all. but it is elon musk, and if you bet against him, it is a very bad bet. haidi: is betting against tesla, elon musk a bad bet, despite all

the issues with investor relations? dave: look, our view of tesla continues to be that it is a transformational growth company, still in the first, second inning of playing out. in terms of the other comment, that right now is the big issue. can this transaction ultimately happen? i think the street needs more details. how this will happen, what the timing is, what are the next steps. this also comes on the heels of what was a real good quarter, really starting to, a mea culpa on the conference call, street credibility was starting to come back to tesla, the right now how musk handles this will be interesting to see the next steps in this saga. ramy: the phrase "show me the money" comes up, because the big question is whether they can get $66 billion for the leveraged buyout. where could that money come from? dave: i mean, that's going to be

the question. you saw the reports on the saudi side, they got some financing there, but it is a steep number. that's the big question. how are they going to secure that financing? given the model tesla has in terms of burning cash, how can they secure that financing? what would be leverage look like? that's what is a big debate among investors. is this going to happen? is this just another sort of chapter in the musk tweet book? even was a jaw-dropper, the sequence of events, the stock halted and the statement they came out with later in the day. ramy: we know elon musk definitely is a showman. $380, but still short of the $420 target. dan ives, thank you very much.

haidi? more coming up. looking to the latest trade numbers out of china, the first reports is the first round of tariffs. we have a mixed picture so far. south korean picture looks a little better, but china pmi's suggesting clouds ahead. we will get the view from our guest next. ramy: and we look at what is driving a busy season for ipo's in hong kong. this is bloomberg. ♪

ramy: this is "daybreak asia." i am ramy inocencio in new york. haidi: i am haidi stroud-watts in sydney. the u.s. has confirmed it will impose tariffs on another dickstein billion dollars of billion ofds -- $16

chinese goods, delivering on a previous thread. tom mackenzie is watching this from shanghai. as markets shrug it off, it continues to incrementally escalate. tom: like tennis, the ball now is in china's court. they are likely to hit back and detail their own extreme billion dollars of tariffs -- $16 billion of tariffs. then you look at washington, the ball goes back to their side. reviewing $200 billion of tariffs that could be imposed early september. china said it would respond with its own list of goods. you are looking at middle of september, likely you have $250 billion of chinese goods targeted by the u.s., versus $110 billion of u.s. goods targeted by the chinese. if you look at an aggregate of tariffs in china, around 15% to 16% of u.s. goods if we get to

pre-wtont, about standards. no signs of talks yet. we get a sense that the chinese are digging in for a long fight. ramy: looking at the yuan, at its lowest since august 1 or so, what do we know in terms of what the pboc is trying to do to support that? tom: additional steps from the pboc. they had a meeting with 14 banks in beijing and told them to avoid "herd behavior." mark cranfield said this should make the markets take note, if they did not take note of the pboc action on friday to make it more expensive to short the yuan. effectively, they say they will lean on the fx markets. that theymments at don't want to cross the seven line. we had comments from analysts, most not expecting the yuan

default to seven to the u.s. dollar. the last thing you want to see is a rapid capital outflow. there is that concern, of course. that's what we are looking at right now, potentially a slowdown in the depreciation for the chinese currency. ramy: tom mackenzie in shanghai for us. for more, let's bring in iris peng, ing bank's greater china economist. we got the headlines, the u.s. saying they will put in tariffs on a further $16 billion. to what degree does this push things to a more tense situation for you? iris: this is actually, going forward in the expected direction, because we are ready know that the $16 billion will imposed, and china has already shown a list of $16 billion retaliation. the next question, more

important, is whether the $200 billion, 25% on $200 billion, will be imposed. if it will, is it the same shown by thehose u.s.? if that's the case, it covers china's imports into the u.s. not onlyay, china will worth ofe $16 billion tariffs, but will retaliate qualitatively. that means it may do something like, national security reason for u.s. companies operating in in china. ramy: we are looking at pain at data.ges of the

looking ahead to china's foreign reserves, to you think we will see that? we can see where chinese foreign reserves stand, in terminal library. the trade balance, $39 billion, the prior was $41.5 billion. what do you think? iris: this shows, first of all, no massive capital outflows. secondly, because people always think that the pboc has intervened in the fx market, if that is so, then the foreign reserves should fall a lot, and we have not seen that. havect think the pbo intervened in fx market since july. having said that, we have to realize the new pboc governor has a different style from the previous one, so he is more

pro-market. i do think that yi gang, after that kind of warning signal, i limitay, the market will speculative activities. but i do think some cooperation -- corporations will continued to hedge. we will not see a 100 degree turn from a yuan depreciation to appreciation, so hedging activities will still go on, even with higher costs. it because ofs the heavy retail component of the chinese investor base? you see economic pressure turning into political pressure quickly.

the equity selloff and the selloff in the yuan, discontent over peer-to-peer lending, signs of fraudulent in that space. do you think this is moving up to political pressures that could really start to overwhelm xi jinping? we talk a lot about his consolidation of power, but clearly he is still vulnerable. iris: no. first of all, i don't think he is vulnerable. with unlimited tenure, it is unlikely he is vulnerable. on peer-to-peer lending, i do think the cleanup is a proper late.se, but it is too it should be cleaned up earlier than this time. but it's better than none. willld say cleaning up p2p push the smb loan demand back to the banking channels. quarterlyhere will be

targets for sme's. these sme's should benefit. in thing is that the banks china still see high credit risk of sme's compared to other loans, so may be the pboc has to change their assessment parameters so that banks will be more willing to lend to sme's. otherwise, a cleanup of p2p lending platforms will mean the sme's will go to underground lending, or other lending. haidi: iris, thank you so much for that. bank greaterg china economist. plenty more to come on "daybreak asia." this is bloomberg. ♪

haidi: let's take a look at how markets are faring in the early

part of the session. trading underway for the nikkei 225. kospi holding steady ahead of key trade numbers out of china, and here in australia. ♪

haidi: half past 8:00 in singapore, have an hour from the open of trading in the lion city. a pretty gloomy day in singapore, but a mixed picture when it comes to the markets, watching of course the open in mainland china.the biggest question , whether we see that rally in the yuan and equities, meaning we have finally found a floor for chinese assets. i'm haidi stroud-watts in cind sydney. ramy: i am ramy inocencio in new york. let's get first word news with jessica summers. jessica: tesla shares and bonds soared after elon musk said he's considering taking the company private. the initial announcement came via twitter, mentioning a share price of $420 and saying

"funding secured." that would value tesla at about $82 billion. the share price failed to reach $420, indicating market skepticism that musk can pull off what would be the largest leveraged buyout in history. big banks the winners from last year's republican tax cuts. firms saved on average $388 million in the first half. over the same period, the groups collectively eliminated 3200 jobs. a year earlier, the growth rate for lending was twice its current 1%. a government projections says australia's population has broken 25 million.the bureau of statistics says the milestone was reached after 11:00 p.m., tuesday night sydney time. the resident population grew by 338,000 people the last year,

62% of the migrants. the number of australians has doubled since 1970 and risen sixfold from federation in 1901. facial recognition security will be used at the tokyo olympics in 2020. it will be the first time the system will be deployed at the games. the technology will be installed at all venues, aiming to eliminate entry with forged id's and reduce congestion at peak times. the technology developed by nec will be customized to monitor every accredited person, including athletes, officials, staff and media. global news 24 hours a day, on air and at tictoc on twitter powered by more than 2700 journalists and analysts in more than 120 countries. i'm jessica summers. this is bloomberg. malaysianh the former prime minister appearing in court soon, he will be charged with money laundering.

unit alsorruption commented. lumpur bureaula chief joins us from singapore. these fresh charges, they are pretty serious. >> exactly. we charged him, under the same case involving a hearingnit, so we are what exactly he will be charged with, under the anti-money laundering act. haidi: and in terms of what we are expecting in today's proceedings, initially it looked like more of a direction hearing but it appears they will be quite a lot that comes out of the court appearance. shamim: exactly. a casegoing to be just

management before the trial starts next year, but with new question onbegs the what more the investigators found out regarding this case, of about 42 million ringgit razak's account from the unit. ramy: there is a $250 million super-yacht among the assets seized. what is the latest? equanimity.n as the it's now the center of a tug-of-war between malaysian authorities and the yacht's owners, purported to be an indonesian financier. for plans has asked about the yacht to be suspended until they hear from the malaysian side. ramy: we will leave it there for

now. bloomberg news editor shamim adam in singapore as we await a hearing for former prime minister najib razak. cathay pacific is expected to take off with more demand for airline travel and fright, but -- freight, but they still face challenges. recovery?ueled this >> well, that recovery was basically a combination of returning passengers, especially on the premium side, and feel prices. last year fuel prices fell, and that really did help cathay drive a bit of a good record for their restructuring in the second half. as we see with the prophets they saw in the second half of the year. ramy: waiting for these

earnings, what would be the important factor determining this? benghee: the key factor will fueled. as you know, oil prices have risen quite a bit in the first half and more so in the second quarter of this year. we saw already that having impact on other airlines as well . singapore airlines saw a 59% decline in first-quarter profits because of fuel prices, so that will be the key factor a lot of people will be watching for. haidi: in terms of the plan to try to gain the competitive edge, what is their strategy? kyunghee: they are trying to up their game in premium. cathay is known for premium services, and they are trying to up the scale on that one. with the arrival of new planes, a-350, trying to offer that more.

they also started new offerings in their dining options for long-haul flights in business class, so they are really trying to improve their services in order to cater to the growing travel premium customers. china,as the gateway to as hong kong positions itself, clearly trade tensions will be something we expect addressed. how are we expecting that to play into, and other expectations going into the second half? kyunghee: we don't really know yet how this trade dispute is translating into air cargo. we did notice a spike in cargo traffic for cathay in the second quarter. some analysts say this was because they were trying to push goods to avoid the tariff in july. we will have to watch a bit closely to see if this was a one-off thing, or if this was

something that we continue to see with air cargo, but definitely cathay expressed concerns about if this trade dispute continues, it could have some impact not just on cargo, but also on the passenger side as well. haidi: absolutely. our asiaparkm, transport reporter in singapore on cathay pacific earnings. the twists and turns of trade have investors fleeing chinese equities. the shanghai composite and the yuan have been some of the worst performers globally over the last few months, but one top-performing hedge fund on the mainland sees opportunity. their president outlines his bull case for chinese stocks. >> we are not bearish at this moment, because we think the market has overreacted to the

compound effect of domestic deleveraging and u.s.-china trade disputes. we see more opportunities than ket hasbecause the mar discounted too much bad news, and sentiment has been so weak, they turned a blind eye to some developments. they are having quite a major policy shift on the policy front, featuring a slowdown in stress.ging and fiscal those changes should have quite a positive impact down the road. >> how do investors position in this environment? where are the opportunities? >> we think the market has priced in too high of a risk for a financial crisis, financial risks. those reactions have been

overdone. we at the current juncture, we are increasing our risk exposure, taking on positions in individual stocks whose long- remain unchanged, but valuations are more attractive after the selloff. we like the financials, we like independent power producers, consumer discretionary, with strong local brand recognition. we also like manufacturers of machinery equipment for homemade technologies. ing,: that was wang q speaking to tom mackenzie. up next, we look at ipo's galore, hong kong's busiest quarter for public listings and years, with p debussy's -- pwc's

wilson chao. ♪

haidi: this is "daybreak asia." ramy: i am ramy inocencio in new york. china tower will start trading in the next hour in hong kong. sophie is that the stock exchange for us. the city is enjoying its biggest ipo summer on record, but there is pretty much lackluster enthusiasm for them. why is this? wilson: investors -- sophie: investors not exact the chomping at the bit to get these latest ipo's, even as hong kong is set for its best quarter for listings since the fourth quarter of 2010. you can visualize that by jumping to the terminal.check out this chart in the gtv library. it shows you, before today's offering, 36 companies raised surpassingbillion,

the roughly $7 billion raised in the first half of this year. when they include china tower and beigene, that will total $17 billion. bear in mind, 26 of those deals have been price at the bottom of their market rates, including china tower, which sell retail subscriptions coming in at the lowest since 1959 for an ipo about $3 billion. part of what could the dampening sentiment is the long-term profit outlook, which is uninspiring. appetite for these ipos has waned, an perhaps investors want to save their ammunition for the pipeline to come. sinochem's refinery unit on the radar and o online delivery giant meituan-dianping. the sectoracing might also be a damper.

we will watch beijing when it starts trading. haidi: thank you so much for that. hong kong is in the midst of its biggest quarter for ipo's in almost eight years as ramy mentioned, but some disappointing performances are weighing on that. we will try to get some answers from wilson chow. great to have you. in your sector, we have seen the kind of underperformance for he likes of xiaomi, some of the pharma names as well. are we expecting this underperformance to continue, and is that because of regulatory uncertainties or a simple lack of liquidity? the stockll, you know market is governed by market forces, supply and demand, as said by the anchor earlier. there on more than 100 ipo's in

the first half of 2018, and there for the investors have more choices to pick from. shares, withing such a shore time. because there are so many shares and stocks, they may have the discretion to pick and choose. is tough because of so many rushing-in ipo's, but we still see, the reason behind, emerging technology like up and coming 5g and others, like application of a.i. and data analytics, robotics. they will drive new businesses across many sectors, like health care, energy, and media. newefore, there will be companies going to the

marketplace to seek funding. for the asian market, chinese regulators have been imposing tightening controls, and therefore we will see they will choose hong kong is the newest venue for the ipo's. we areis it just a boom seeing in the first half, or do you expect to see this continuing? seeon: i said we will continuous momentum. investors still have a very good appetite, and also because in the past, many might choose a u.s. market, given they can get higher valuation. allows them to retain founder control over the company and a system where valuation goes up.

see they will continually see a boom in the ipo market in hong kong. because of the close proximity of china, the hong kong investor, there is no language barrier or time constraint or time zone difference, so they would pick hong kong for the ipo. ramy: given the large number of companies that have gone ipo in hong kong, would you suggest they wait to try to get that money that is tied up? wilson: well, i would think that it's the basics, we need to look at the fundamentals. the underlying technologies them, whether they are a sustainable business and if business growth is supported by the underlying technology. ork,e see that, the models w they would attract valuation. available,ore stocks

the investors have more choices, but they will make the rational investment. ramy: in terms of rising funding costs, especially with the trade war happening, what are your biggest concerns? wilson: you are right, the ongoing trade were between u.s. and china, as well as the pressure on interest rates, might create upheaval in the stock market. however, as you see the asian markets have slowed down at the moment. because of the ecosystem, more investors are educated and can know more about the company, attracting higher valuation. we remain optimistic about the hong kong market. haidi: you take a look at what has happened with the chinese of thee scandal, one biggest manufacturers. using that as an example, is

diligenceicient due on the ground when it comes to chinese companies listing in hong kong? wilson: i agree that investors need to be more rational. don't just rush in to make the investment. go back to fundamentals. look at the business model. look at the underlying technology supporting the company, in order to make a reasonable investment. they need to do their homework. haidi: right. further looking at the regulatory oversight beijing has, is that a major risk when you look at some names in new economyech, names that seem vulnerable to knee-jerk regulatory reactions or edicts coming down from beijing? wilson: i think the regulatory forces are a good thing for the healthy development of the ongoing capital market. that is because now many of the unicorns are engaging in the

so youg business model, have regulation set up to control their operation and govern their well-being.therefore answer is think the tightening regulation, setting up a better seen for companies to operate in the future. in the long-term, it is beneficial to the stock market. haidi: one of the reasons for lackluster demand for xiaomi after so much anticipation was a lack of clarity on the chinese depositary receipts. are you expecting to get more of a comprehensive understanding of when we will see that taking place? wilson: well, when we look at, one of the major objectives is to allow domestic investors in china to participate in the companiest of the listing overseas.

as the rules were just also, because- many of those are large companies, and given the current asia market a bit slowed down, that will attract some instability to capital markets. the government would like to clarify the rules of the market, and wait for the right timing to optimize the impact of this offering to the long-term health of china's stock market. haidi: wilson, thank you so much for giving us those insights. pwc global tmt leader, taking a look at hong kong. the big ipo's in the pipeline, china tower among them.for breaking news wherever you are , we teamed up with twitter for

tictoc by bloomberg, the first news network for social media, offering reports verified by us. if you are on twitter, make sure you are following tictoc. this is bloomberg. ♪

haidi: this is "daybreak asia." -haidi stroud-watts in sydney. ramy: i am ramy inocencio in new york. southeast asia's biggest

property developer reported higher second-quarter earnings. net income of $444 million, compared with $425 million a year ago. revenue of $982 million, up from $728 million. group ceo lim ming yan said capitaland is looking for opportunities after reducing exposure to the singapore market ahead of the curbs. intenseingtel facing competition in india. net income through june fell 6.5%, the equivalent of 609 million u.s. dollars. the ceo noted the increasing rivalry, but set they have nonetheless gained in market share. ramy: softbank might be in talks to to invest half $1 billion in a startup that makes and delivers pizza with the help of

robots. california-based zoom owns a patent for a truck that can cook food while en route to a customer. they are loaded in part by robots and have ovens that fire up on demand via the cloud.that is interesting . ok. haidi? haidi: we were promised flying cars, and now we have are about pizza, apparently. -- robot pizza, apparently. [laughter] rish, what are you watching? rishaad: i have my jet pack, anyway. [laughter] leg,d the back of my unfortunately. china tower coming to the market at the bottom of the hour, and beigene's founder and ceo drugng us, a u.s. developer raising $903 million in a secondary stock offering in hong kong, 765.6 million shares. trading for that one starts at the same time.

final price, 1.6% discount of the stock's last close in new york, expecting a move to the upside when this particular offering gets off the ground. 45 minutes to go before we get to that guest. we have of course sophie on-site at the hong kong exchange. at the, but two ipo's bottom of the hour. ramy: before we hand over, a quick look at how markets are trading. you can take a look. green across the board, the nikkei up the most by about 0.3%. haidi: taking a look at asian futures. singapore, quite a bit of upside overall. this is bloomberg. ♪ two, down and back up.

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,ishaad: of thing the anti- trade tensions rising again. washington confirming tariffs on $16 billion of chinese goods, beijing val's to respond. to avoid a herd mentality in the currency market. asia-pacific stocks slightly to the upside after wall street close near a fresh all-time high. i am rishaad salamat in hong kong. >> i am sophie kamaruddin. we are counting down to the debut of china power