. ♪ u.s. stocks climb in trading amid hopes of easing trade tensions. investors now awaiting headlines from jackson hole. >> the s&p 500 advances for a third day to close up 15 points, a brand-new record. consumer discretionary's led the decline. makersiberal party prepare to meet, his leadership could be challenged. >> president trump lashing out again, accusing the eu and china

of currency manipulation and bemoaning jay powell's performance. >> hello from sydney. is daybreak australia. we are two hours away from the opening of asia's markets. rainy: good morning. ramy innocencio. it was another green board today. let's take a look at the close and how we ended this monday session. the s&p 500 up about .25%. 25%, led, broadly, by materials and an genji -- and energy. this is a look at what is chinaing between u.s. and trade tensions. we are also looking at what is happening between the fed and jackson hole. today, donald trump saying he thought jay powell would ea -- would be a cheap money chair.

we are not seeing that now. he has raised rates five times in the past couple of years. president trump continuing to criticize him for raising rates and saying that europe and china are currency manipulators. findings against the of his own treasury department. let's take a look at how things are setting up in asia. trading in new zealand just getting underway. bit of a benefit when it comes to the aussie and the kiwi overnight. flat atooking pretty this point. at this point, you are not really seeing the numbers and the drama that is going to play .ut we are staring down the barrel of a sixth prime minister in 11 years. markham turnbull is under immense pressure from within his

own ruling party. there are reports that he does not have the support for a potential leadership challenge. people are still talking about that. we are going to take a look at the applications for policy. some of these omissions targets are in line with the paris accord. we are going to take a look at are we back at a rotating doorway of policymaking here in australia? ramy: we will also be watching bhp and just under half an hour's time and we will break that live and get immediate reaction. we will also hear from andrew mackenzie, joining us live on bloomberg markets: asia. that's first on bloomberg, so stay tuned. more on the trump impact on the

dollar ahead of the fed meeting. we bring in su keenan. investor sentiment somewhat bullish. this is the third day in a row the s&p came within 15 points of an all-time high. to the market snapshot. if we can keep the trade war talk at bay and the trump tweets, perhaps, as the market has a chance to move to the record, we did see this over the weekend after trump criticize the fed chair, which is unusual for a sitting president, but we have an unusual president. gains stocks win back after trump criticized alleged currency manipulation. let's look at big movers. there were notable swings in stocks. this is a time of year that a lot of major wall street investors are on vacation. health care was down, managed to -- tesla was down, managed to erase losses and come back.

there is focus on the saudi fund and speculation they might take their money elsewhere. and there is speculation that perhaps a major company will come in and help elon musk in this time of crisis. news down on various including that it's gambling app in china is under scrutiny. rebounding efforts after a strong selloff last week. bloomberg is where you can find our library of stocks. we have bearish positions on the 10 year, at near record levels. in the current rating on bonds, jeffrey dunlap morning -- warning that bondholders are at risk for a short squeeze, when they are forced to cover their position. haidi: thank you for that. let's get you to first word news with jeffrey sommers. >> president trump has

repeated his claim that the eu and china manipulate their currency. he told lawyers that beijing artificially lowers levels. in a wide-ranging interview, he also said he had no timeframe for a diplomatic standoff with turkey and that it is dangerous to have companies like twitter and facebook regulating themselves. significant second-quarter slowdown in the chinese economy after analyzing a wide range of data. the manager of access equities told bloomberg the pullback was more based on alternative data then the government's official pmi reading. the data now shows some stabilization. overall, fundamentals seem to be not bad. sentiment, on the other hand,

certainly has been quite negative. there is green at the beginning of august. >> water has begun receding after the worst floods in a century, but some areas remain an accessible to rescue teams and nearly one million people are in refugee camps. three and 41 people are known to have died since the monsoon began. it is more rain than normal. now is disease from contaminated water. greece has completed the last of its three bailout programs. it still has an and norma's task enormous task ahead. it is more than 60% below the level announced in 2010. led the five worst

performer since the bailout of banks, all of which have plunged more than 99%. freew greeks can have access to markets and i really think the reforms, the amount of reforms that have been realized make greece a much more secure country. >> global news 24 hours a day on air and on tictoc powered by twitter. im jessica summers. this is bloomberg. hasi: president trump complained that fed chairman jeff powell hasn't been the policy maker he expected. the remarks were made at a republican fundraiser. the first personal criticism of powell to emerge so far. this is something of an escalation of trump's criticism of the fed, which has been

building. >> he has been grumbling about rising interest rates. he is now going after his appointee, fed chairman jerome powell on raising interest rates. he said i said this -- he said this at a private event in the hamptons on friday to emphasize the point. he also said the same thing in an interview later today with reuters. step -- heing of a sort of broke the norms with his on fed interest rate hikes and now he is specifically naming the chairman. he wants him to be more accommodating and to help him more at a time when the u.s. is in the midst of trade battles. he said other countries and central banks have been helpful to the government, but the fed has not been helpful to the u.s. ramy: this cuts against

tradition. how much of an impact might this have? lexus central bank is fairly insulated from this. -- >> the central bank is fairly insulated from this. the chairman is appointed for a fixed term. they theoretically should be independent and immune to outside criticism, even from the president. however, they do live in the real world. the fed has raised rates more slowly than in other economic expansions, primarily because in the u.s.n rate remains just at their target rate. i guess we will find out later this year how much of an impact this might have. >> and hopefully, we might get some things from the tea leaves later on this week in jackson hole. thank you. us now for more is the chief u.s. economist stephen blitz, joining me here in the new york studio.

.his is quoting donald trump should we be? truman once harry was very angry about the fed. trump is not the first in line. onis more vocal about it twitter and everything else, but look. he is a child of the 1960's. the policy of the 1960's, like everything else, big deficit, any money, is a policy that responsible nation wants to go through. he pushed through a huge tax cut of $1 trillion in year one and an economy going on all cylinders. cars, housing starts at one point 3 million, decades low rates of unemployment. it's hard to argue for cheap money. you have any concerns

about central bank independence? rate hike this a year and possibly two or three next year? --ex i don't, but >> i don't, but the problem trump now creates for himself, let's say in the fourth quarter the numbers start looking a little weaker, perhaps because of the strong dollar and concern over trade and capital spending starts to slow down, and he , now i becomes a question of whether or not he skips on his own vote or because of pressure from the white house. that's the danger. it's not so much independence, but perception. thingsdavid, among other , donald trump job owned and almost threatened the possibility of doing something

when it came to the dollar. jpmorgan has said the idea of selling dollars is not entirely out of the realm of possibility. that level of intervention possible? what it's possible. you have to go back a long time. look, i think trump is on more solid ground. europe is clearly the problem child around the world. has a trade surplus. a huge percentage of its gdp, and you have a chairman of the bank there, mario draghi, who doing hisd to stop version of qe but announced he was going to hold rates constant for the next 12 months even though germany is growing rapidly, france is growing rapidly, france's doing well. it's hard to argue why rates should be negative.

that case, he's right. whether or not the treasury does something like cell dollars is a whole other kettle of fish. yet, the downturn on the trade front is with europe, not china. do you think europe is a bigger issue for trump? >> it depends on how you want to look at it. he is looking at it from a narrow perspective of bilateral aspects. clearly, it is much more china. although, china is more, i would say, part of the u.s. supply chain ban the traditional trade model we got in school between -- between onees country or another. europe is a different situation. from a global standpoint, which part of the world is really sucking in capital. and not letting it back out again.

hence, the demand for good, that's europe. when we talk about europe, we are really talking about germany. ramy: very quickly, looking ahead to jackson hole, what you want to hear from jay powell? themwould like to hear talk a little more intelligently about the fed balance sheet. , everyone talks about bank deposits as reserves. it's really not. is reserves. the other part is required .apital it happens to be held at the fed instead of being held directly at the treasury. once you make a separation between the two, it becomes easier to understand what it's going on in terms of quantitative tightening, shift of assets from the fed balance sheet to the banks, and what

that means in terms of how far do they really want to go? , we will continue to a conversation, talk more about trade and how policy makers can react. some breaking news. chp final earnings coming through. they missed estimates quite considerably. numbers comingit through with a final dividend , $.43 year on.63 year. we will get some more analysis on that shortly. we had been expecting returns for bhp later on today. more breaking news crossing the bloomberg terminal. this is on the paul manafort case happening in alexandria. no verdict has been reached in that trial. the jury is set to return again .t 9:00 a.m. to continue this

again, no verdict reached in the manna for trial. stick around. ♪

the: breaking news crossing bloomberg terminal with bhp earnings. fiscal year profits came in at 9.6 billion dollars. the estimate was $9.2 billion. that was upbeat. however, net income was a miss, missing even the lowest estimate, 3.7 $1 billion. the estimate was 6.6 8 billion dollars. compare that to $3.71 billion in terms of the actual. looking at dividends per share for investors, $.63 versus $.43 year on year.

underlying profit, 9.6 billion dollars, beating the estimate of $9.2 billion. haidi: one more line coming through. getting a full forecast on what the future looks like. in the meantime, speaking of trade and the relationship with china, so many companies, including minors, really rest on hinging on the outcome of these potential restarting of trade talks. in the meantime, trump has used an interview with reuters to accuse china is manipulating currency. the president is going against his own treasury department when it comes to this point. >> he is and he isn't.

i am not sure exactly what it means when treasury decides to call the fed or china a currency manipulator. he is acting more like a complainer. and he has a point. the currency has weakened. has begun to weaponize the currency. but this is what he has brought forth. we could argue whether or not his views on trade and whether or not the united states has been in an unfair trade position for a long time, whether or not that is correct, the way he is going about it doesn't himssarily get -- it gets political points, but doesn't necessarily get him to where he wants to be. and the guy on the other side of is a politician. he has people. he has to protect the economy and do what is best on his side. you can't expect him to roll

over and acquiesce to the president. thatis why we are thinking later this year the u.s. economy slows. we see signs already not because of what is going on now but sector ofthat a good the economy is losing steam. we think that is going to become more obvious as the fourth quarter rolls around. certainly the first quarter next year. when it comes to comments about the fed, this is what it makes it harder for them to act and have people believe they are acting independently and the best interest of the economy. youi: i am curious why think this is a deliberate depreciation of the currency by beijing. it comes with a backdrop of some pretty impressive dollar strength. is that part of the story? competitiveness comes through, but the yuan would have

to be a lot lower than it is now and that is not something that notsing p is -- that is something that beijing is comfortable with. >> we don't know if they are or if they are going to get there. this could be considered a warning shot across the bow as full battle.e he is showing his hands a little bit about what they can and might do in retaliation. , they are coming in to talk. look at the global picture, the real problem is the evaluation of the euro not the yuan. ramy: looking ahead to those talks, it seems like guests on bloomberg are not holding their breath. how do you feel about this? >> i think the biggest reason does yourd her breath breath when it comes to treasury in the white house is that --

not to hold your breath when it comes to treasury and the white inse is you have mnuchin treasury who is known to be dovish on these issues. even if they come to an agreement, they could be served by the view from the white house and we really don't know. u.s. economist stephen blitz. interact with the charts shown using btv go. catch up on key analysis and save those charts for future reference.

ramy: a quick check of business headlines. tesla managed to stave off further declines and its longest losing strength in months. jpmorgan turned bearish saying a deal to go private is far from

even being proposed. another person said he would like tim cook to step in. >> tim cook is the perfect person. that logistical expertise is exactly what he did for steve jobs. it's like a perfect match. apple is considering a low cost laptop that will resemble the current mac air. a high-resolution retina display. also considering launching iphones and watches with larger screens in the coming weeks. samsung has overtaken zte in the battle for supremacy in mobile networking equipment. dell says samsung is now the the topchallenger to

.hree, ericsson, nokia zte was hit by a technology ban in the u.s. this is bloomberg. ♪

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off, and free shipping, too. go to buyleesa.com today. you need this bed. it's 8:30 a.m. in sydney. markets open in just about 90 minutes time. stocks were 15 points away from a record high for the s&p. sydney is flat as we go into the open. is 6:30 new york, it p.m., and you are watching daybreak australia. bhps talk more about results. andrew, looking at the numbers, the big one is net income, the iss of estimates.

almost half of what they were expecting. >> profits are broadly in line with expectations, but on the big loss would be the right down from u.s. shale assets they sold. ramy: here we are in the fiscal year looking at a profit of 9.6 billion dollars. the estimate was $9.2 billion. minors looking for in this result? >> one thing they really wanted was a big increase in dividends. paying $.63 for half, which is more than expected, and overall the dividend for australian investors is almost 5%, which is pretty good for any company. we are looking for more details as to where future assets are. has alwaysre what

been on the table for bhp. one thing they have had on the shelf for five years is nickel west. withtors will be pleased the cash flow number, which is $12.5 billion this time around. the hp still has a lot of cash. haidi: we are speaking with andrew mackenzie in a few hours time. what would you want to hear? weighing onnes are china. >> bhp is highly reliant on china. the other thing this time around, in this result, iron ore has obviously been a huge mainstay for bhp earnings, but copper had an 83% or something like that. been high production from escondido and no strike. that's probably another positive

for them. thei: just going through bhp earnings, we are going to get more on these results. andrew mackenzie joins us at half past 11:00 a.m. sydney time, that's 930 p.m. in hong kong. elizabeth gains will be here in sydney on bloomberg markets asia. don't miss out on those conversations. let's get you to first word news with jessica summers. jessica: president trump is said to fed chairman dave powell -- that fed chairman jay powell hasn't been the policy maker he is expected. he made the remarks at a fundraiser. the fed has hiked five times since the president took office, including twice this year. he criticized powell saying he was not thrilled with rate increases. plannedng trade wars for the coming years.

beijing slapped a tariff on american employees. that's bringing prices down and compelling farmers to lower harvest. the bank says that could mean a fall production of 7% over the next four years. the council disagrees with that view. strengthen -- yuan strengthened for the third day back of an the weakening dollar. the yuan's recent advance follows a slump of 6.6%. policymakers are seeking to limit outflows as liquidity tightens. sentiment toward corporate bonds has nosedived. of fund managers says a proportion of those with 20%ish outlooks has gone to from 63%. ofrs are at 63 percent respondents, more than double

the number in july. there may be trouble after a recent five-week fizzling in the credit market. global news 24 hours a day on air and on tictoc on twitter powered by more than 2700 journalists and analysts in more than 100 20 countries. i am jessica summers. this is bloomberg. ramy: australian prime minister malcolm turnbull will be meeting shortly with his leadership, from poorsure polling and policy analysis. an election must be held by the middle of next year. a lot going on. joining us from malvern -- and international relations lecturer. i understand this all comes to a head over the topic of climate and energy. what are the details and how much is this central to the issue?

>> good morning. the guarantee was the latest attempt by the government to somehow reconcile the desire and needs to cut emissions but also ensure there is a stable and secure source of energy and power for consumers and producers. is the have, however, australian government has yet again been unable to deliver on this. those watching will remember this issue of climate change has been at the forefront of australian parties for at least neither side of politics has been able to address this issue. 2010, 2013, tony abbott, and mr. leaderl, the opposition 2009. ended becauseship they were unable to deliver on

this policy, and it appears it's going to happen again. policy, politics and power spins on this central issue. looking at what could be a challenge here, the home affairs minister has said he supports the current leadership. supporte saying he has if he wants it. >> he is looking like a likely challenger. australia has a coalition in government at the moment, liberal and national mps, and the leadership of the liberal party will be decided only by the liberal party. -- he only needs 43 votes, a simple majority to win if he is going to challenge. will get a clear

sense of if there is going to be a challenge today. if not, it appears mr. turnbull's prime minister ship is on its last legs. it's just a matter of timing as to when the challenge will be. haidi: you look at the rotating door nature of leadership in this country, it's a pretty compelling argument that a run of economic growth and are more to fortunate circumstance than good policymaking. his are going to last given that we are entering more challenging times economically? >> that's an interesting point. when you look back on race and challengingthe times australia has had in the economy and the prime minister's government has remained stable, it's interesting that governments are trying to change their leaders.

there is global concern, and much of it is about stability. australia has a stable political system. the machinery of government is well-placed to withstand personnel changes. but i think there is great frustration in terms of having the opportunity to vote in and out prime minister's. three years ago, people voted interval -- voted in malcolm turnbull but would like to vote them out if they could in the next election. haidi: two of the biggest issues for investors and for the future of growth in this country lie within tax policy and energy policy. in both of those areas, we are seeing policy paralysis. is this likely to change regardless of who leads the country? there issting thing is no real discussion about changing policy. turnbull overcame tony abbott some years ago now,

there wasn't a decision to change policy. the interesting thing is policy is at the core of these debates rather than popularity. it seems misplaced a link the co-election this coalition of whichever party to victory. i would not look at the economic or social policies of australia, but it might be a circuit breaker in terms of passing suchlature -- legislation as company taxes which are currently in the senate. they failed to pass. maybe there might be a rekindling of interest in that. i would not expect major policy changes at all. ramy: let's say mr. turnbull does not get a challenge soon. does he come out of this is he just limping along until the next election? >> you have to think the damage is already done.

leadership situation, there is great concern with either party about the leadership. doing everything he can to maintain the support of his colleagues. part of that national energy guarantee was to have an omissions target cash in emissions target and to cut targets by 26% -- to have an emissions target and to cut targets by 26%. you would have to think even if there is no challenge, he will be a sitting duck come election time. haidi: you look at potentially australia getting a new prime minister who is much more socially conservative than malcolm turnbull. of course, there was a recent pretty extraordinary speech from the president is well. is this a country that like so many others is lapsing into populist mode, so too is the? >> -- so to speak?

there is acan say is perfect storm that gives us that sense. from queensland. the logic within the coalition party is that queensland is going to be the battleground. things are ultra marginal. based on the elections of last turnbull'sr mr. leadership, the party lost votes. there would be a mood for change in the idea would be to have a prominent queensland man and the votes ofto win nationers in the one party. he would be a unifying force. we know the coalition has only a one seat majority.

so they must hold onto their seats and win them. he is popular in queensland. it might be a good opportunity to keep those seats in queensland. fori: thank you so much spending time with us there. politics and international relations. , the markets are digesting president trump's latest tirade against the fed, against china and against the eu . this is bloomberg. ♪

haidiramy: welcome back. haidi: you are watching daybreak australia. let's get you a quick up eight on the markets. -- update on the markets. a little bit mixed in asia. trading in new zealand is

underway. kiwi dollar and the aussie dollar seeing a little bit of strength. sydney futures also looking .retty flat the s&p broadly in line. on a couple of those points, we missed increase. we will be speaking to andrew mackenzie a little later for his views. more broadly around the rest of threerket, we are seeing days of gains in the u.s., just 15 points away from a record high. and theen strengthening trading at 1.97. a pretty big move on the u.s. 10 year yield after the comments

saying the short could be in danger at this point. just a reminder, we saw very thin volumes on wall street overnight. in asia.nderway president trump did an interview in which he accused europe and .hina of currency manipulation it was sort of an airing of grievances that we have come to ask act. -- expect. >> the market listened. the market was primed to listen. the dollar tied with the lira last week. the yuan for a while had been falling a lot. -- the last broad dollar index fell the last couple of days of last week and then it fell again on monday. part of what is going on here both with yields and with the dollar is everybody got overstretched. possibly the two most crowded

trades in the business at the moment have then dollar long and treasury -- being dollar long and treasury short. we have a library that takes a look at these. see the way it took off or both of them in june. we have a tendency to be long dollar for much of the last five years. again, mostly short. that's 10 year treasury, just fell off a cliff. went to levels completely out of the ballpark. ,n that sort of a situation trump about a week and a half about how ourng strong dollar was hurting the lira, reminding himself that he doesn't like a strong dollar, on that adds to the pressure people feeling stretched. we got a turnaround. the comments on the fed helped.

10 year yields were already trending down. we just got an alert, on the u.s. of the japan falling below 110 for the first time since june 28, almost two months ago. you can see it, 109 .93. in the meantime, i know we are watching the yuan's movement. after the pboc raised its fixing on monday. what are the details there? >> trump accused china of manipulating its currency, and you have to remember that the yuan is a manipulated currency in that the pboc sets a rate every day and that's a guidance. it is trying to make it more guided by the market, but it

had decided its currency had gotten to week, which is the opposite of what trump seem to be accusing it of trying to do. about 10 year treasury yields. and the impact of currencies. argues that china isn't purely picking numbers out of a hat when it comes to the yuan is showing the yield cap between the u.s. and china. it has traveled the same way as the yuan. that's about more than manipulation. of it has been persuasive a because china's economy is slowing down -- well, growing at and the u.s., economy has been accelerating. don't expect the yuan to strengthen too much in the coming days and weeks. ramy: garfield reynolds, thank you. don't forget to check out our

btv library for some of the charts you saw. it's on btv go on the bloomberg terminal. china's economic rough faced the effects of beijing's deleveraging campaign and trade fiction -- friction. still, the head of china's trade bureau says he still expects it to surpass the target this year. are don't think the data disappointing, although there are some slight fo fluctuations. the fundamentals are sound. is moving steadily was some improvement and that has not changed. >> the data does suggest we are seeing a gradual slowdown. >> the goal we set at the beginning of this year's for china's gdp to grow by around 6.5%. the first half of this

year, we have actually realized a growth of 6.8%, which is a lot higher than our original target. i think it is fair to's they growth of six point -- to say growth of 6.5% is very rapid speed in the world. among major economic powers, only india can beat that. we will continue to aim to achieve these growth targets, but in my personal opinion, this year's growth may even surpass the government target. >> let me ask you what you think are the key downside risks for the economy in the second half? stem from change. internally, we must solve the lingering structural problems in china's economy. one of the risks they sing the comes fromthe moment the international economic environment.

it has been harsh, complicated, in further deteriorating, increasing friction between china and the u.s.. haidi: you can get a roundup of the stories you need to know to get your day going on the terminal. it's also available on the mobile and bloomberg anywhere app. you can customize those to just get the news on the industries and assets you care about. this is bloomberg. ♪

ramy: welcome back. a quick check of the latest business flash headlines. mixed messages around the chinese developer, continuing to jump with a special dividend, but gnp research says skepticism about the company's debt fueled

business model is driving shorts. the first5% gain in half on the back of seemingly unstoppable home sales. net earnings rose to $1.3 billion from a billion a year earlier. profit was almost the same. they have won conditional eu approval for their $45 billion merger. it combines two of the biggest suppliers of industrial gases. sell itsny agreed to entire gas business in europe as well as its stake in an italian venture. presidentl about what trump said and we have earnings to tell you about as well. this is a company that continues to deliver robust earnings

despite a lot of concern we have and in the china biotech health care space, a lot of questions about whether we have reached a bubble in the region now. will speak to the ceo of the company, chris chen. have announced a partnership with a vaccine company weeks before the vaccine was scheduled to hit. this hour,later on we will be talking u.s.-china trade tensions with cornell .niversity professor thehinks a breakthrough is -- he things the chance of a breakthrough is slim. heading into jackson hole, wyoming, the central bank powwow. we will speak to an economist about what his expectations are going into that meeting.

also, criticism of the fed from president trump of jerome powell. that is it for daybreak australia. all the action up ahead on daybreak asia. this is bloomberg. ♪

yvonne: it's 7:00 a.m. here in hong kong. welcome to "bloomberg daybreak: asia." then trading on wall street, the s&p 15 points of a record. bhp will be in the spotlight after full-year net is the lowest estimate. underlying profit has hit a four-year high. and from bloomberg's global headquarters, i'm ramy inocencio in new york where it's just past 7:00 p.m. on a monday. president trump lashes out again, accusing the e.u. and china of manipulation as well as promoting jay powell's perf