>> welcome to "daybreak: australia." asia are counting down to 's major market opens. >> these of a top stories. trade makes headlines as a new deal with south korea, china says the door to talks is open. .ompetition is there tariffs with beijing could send

the dollar down. u.s. equities fell on concerns about global trade. oil rallies towards a four-year high. >> let's get a check of how markets closed on the first trading session of the week. on wall street, markets pulled down by global trade tensions -- because of political and political uncertainties. rod rosenstein may resign, which could affect the mueller investigation. down zero point 7%. every sector on the s&p 500 was in the red except the tech and energy. the biggest loser on the nasdaq was comcast because of investors' concerns that it overpaid for sky. atheld steady, the nasdaq, 7993. let's see how this translates to asia. investor optimism is

tested with the trade reality check of the countdown to the hikeosts likely rate wednesday. we are seeing declines extend after closing lower monday. the mood is dour in sydney but after japan returns after a long weekend ahead of the boj's meeting in july. china, returning to the fray, which could see pick up in volume. hong kong, offline this tuesday. a bit of a breather after the hang seng fell with that you want on monday after china canceled trade talks with the west, adding to anxiety. south korea oil -- south korea remains close to a not him stival.l -- an autumn fe the changes there are likely cosmetic. news, first world jessica? jessica: the door for trade talks is always open, but

negotiations require mutual respect. beijing responded to trump tariffs with duties up its own on $60 billion of u.s. products. it emphasized the need to uphold national dignity and checked core interests. china says it can't meet u.s. officials and was president trump backs away from threats of further tariffs. president trump briefed on the inter-korea summit and says he expects a second meeting with kim jong-un soon. he met his south korean counterpart and was told kim wants to reach a deal on the nuclear program. the president am a in a second -- said a second meeting would be held in singapore. >> i believe north korea has tremendous economic potential, and i believe chairman kim and north koreans want to see that potential, and we will help them to that end. the relationship is very good.

in some ways, it is extraordinary. we will be having a second summit in the not-too-distant future. that: the u.k. is warning flights may be grounded if there is no reciprocal deal with the eu on air travel. the government says it will continue to recognize european aviation safety standards for two years after brexit, but there is no guarantee at the moment that planes, cars -- planes, parts, crews and employees will be recognized by brussels after march 29. brett kavanaugh is refusing to withdraw and is announcing sexual misconduct as smears. he said he wouldn't be says whatd of -- and he calls it character assassination would not succeed. kavanaugh denies all accusations. day, 24ews, 24 hours a

hours -- on tictoc on twitter, in more than 120 countries. this is bloomberg. >> thanks, jessica. taking a look at u.s. markets, after political concerns pushed the dow and s&p 500 lower, comcast plunged after agreeing in su skye. let's bring keenan with the latest. we have the markets take a hit after reports deputy attorney rod rosenstein could be resigning. it could have repercussions for the mueller investigation and the trump presidency. came out that rosenstein told friends he was talking about recording the president. there is the concern that if you leaves, his replacement could thatid of mueller, and accelerated the selloff. is thehave on this board

s&p 500 industrial index. a big loser, having a lot to do where the tariffs sit. the s&p 500 index, a big winner as oil hits a four-year high. let's go into the first panel of stocks. you will see a lot of red on the screen. i will call this tariffs and other woes. an aluminum company and a chemical company in the bull's-eye. woes, and turbine starbucks announcing it will cut jobs and make a significant change to its structure in a reorganization that has investors concerned. another group of stocks, calling them my merger -- calling them merger monday moves. stocks surged three fold to fourfold as heart medicine gets a big thumbs-up. coors down as it is discussing possibly buying -- kors down as

it is discussing possibly buying barrick, the gold company, rising as it predicts 1300 gold and arranges to buy a rival. washe winning bid for skye a losing bid for comcast investors. that stocks, plunging on worries about the prices being paid. >> it be look at the stock chart, i have a chart -- if you look at the stock chart, there is a big drop off for the month. on the day, down as much as a percent, a loss of $12 billion in market cap. analysts say this company could join the $100 billion debt club, a small club. that means pressure on the credit rating, inching closer to junk. one major debtholders says, or a shareholder in comcast, says now is the time to buy.

they say comcast is strong enough and the cable company could pay off the debt, but it is a stock to watch, very much in focus. >> energy producers got boosted by the price of oil. ofe are calling for hundreds dollars and saying it is about iran. >> it has to do with that and the opec meeting. let's look at brent oil as it was approaching 80. tweeted, let's get opec to bring oil down. they sidestepped the issue. check out west texas intermediate oil, rising on the day. bloomberg gtb,he this one is called opec spare capacity. it drops. that is their ability to pump more oil. that raises the question, could they impact the price or bring it lower if they wanted? there are questions as to whether they can. >> that is su keenan with a wrap

of the overnight action. the latest news on the trade front, the u.s. and south korea signed a free trade agreement, the first major deal president trump print -- has included since taking office. he and president moon met on the sidelines of the general assembly. trump called the original deal a job killer. he says this is a new agreement, not just a tweaked one. is that true? >> it it -- it appears from some of the details that is, out that this is not a major revamp of the deal. there have been complaints from critics that it didn't go far enough to what they wanted to see change in the deal. goes, thethat president is declaring victory and moving ahead with the deal. it was wrapped up comparatively to other trade deals fairly quickly, and they are set to

move ahead and get this out of the way. >> we are discussing this with su keenan about rod rosenstein. he may resign and that has hit the market. is still thess, or boss of mr. mueller and overseeing the investigation after jeff sessions recused himself. what are the implications if he does leave? >> there are a number of dominoes that would fall. the solicitor general would probably take over oversight of the mueller investigation. there is complications with that his former law firm is representing the trump campaign in the investigation. exactly where this is headed. as of last week, we are told rosenstein talked about resigning with chief of staff

john kelly at the white house. there were some officials who this morning fully expected that to be turned in, for rosenstein to be gone at the end of the day . then it was a conversation he had with the president. they seem to be moving towards having a meeting thursday. nominee for trump's the supreme court, finally going on television to address some of those allegations of sexual assault. what we know so far? >> the white house is rallying its allies and donors and other supporters to put on a full-court defense of brett kavanaugh. the extraordinary step of appearing with his wife on camera on fox news, friendly territory, to get out the message that he is not going a very forceful denial that he has never sexually assaulted anyone in his life. and he was never at a party

where his accuser said this occurred. both sides are putting quite a bit of pressure leading up to this thursday hearing, at which the judge and the accuser will be testifying to the senate judiciary committee. there are other allegations that have come out, not fully -- corroborated. the attorney who gained notoriety for representing stormy daniels says he has a client with credible information. he hasn't revealed that is. he has jumped and the mix on the issue. >> thank you so much. headlines, iftest u.s. and japan trade talks have been postponed to tuesday at the earliest, we are expecting japan's economy minister to meet ambassador like kaiser --

lighthizer. we know shinzo abe met with president trump, saying they had constructive talks on trade. we are hearing the trade talks between the japanese economy minister and the ambassador will be postponed for tuesday at the earliest, according to kyoto news. says thead, brazil ongoing trade war has had no effect there, despite china being its largest trading partner. >> up next, jpmorgan sees volatility rising across all markets. we will speak to a portfolio manager about where the bond market is heading, next. this is bloomberg. ♪

, you goe counting down

ahead since you are there. it is chilly in sydney given that we have had lovely warm weather. these are the futures, down a little bit. we have a mixed picture going into the asian session. we had the announcement on the, is it a new trade deal with north korea? that will be positive going into another day of trading that sees a couple key markets closed today. shery: more certainty that it has been six months since they agreed on the renegotiation in principle. we finally have text, and the president has signed it. haidi: you're watching "daybreak: australia." we are 48 hours out from an expected rate hike. rates may hit 3% by the middle of next year. joining us now is a jpmorgan

global bond manager. the fed wants to go. are they going to go to more times? >> i think they will, in the first half of next year. what will be more interesting will be to find out regarding some of the economic expectations on the number next year. how's the central bank? are the you try to navigate what will happen on the trade war? >> that will be a challenge. they need to go with the fact, the economies are still doing pretty well. for the fed in particular, inflation is above targets. they can continue on this slow normalization they have been doing since 2015. i don't see them stopping unless we see a pickup in trade rhetoric, which impacts the overall it economy. haidi: want to throw up this chart to take a look at what is happening with the 10 year

yield. do you suspect these divergence will continue? the bond markets sparked volatility. >> it has to do with the speed you get to 3.5%. the fed move is big. if you have a grind up one or two basis points, i think the market will like that. are benefitings the banking system in the u.s. the dollar has to a lot this year so we may see stabilization, and we had hawkish comments out from draghi around his view on europe and the inflation picture. you will get an environment where other central banks will catch up to the fed. yield what about the curve environment? we are expecting a rate hike from the fed this week. this chart shows you the

flattening yield curve, which has been persistent on the top. 10 year yields rising above 3%. is this the trend you see going forward? where is the yield curve headed? longer-term, you have to expect the yield curve to flatten. the reality is, we have seen steepening in the yield curve. there is a possibility we are going from quantitative easing. pension benefit that u.s. investors had pre-september 15 has rolled off, so maybe you will see steepening. but the long-term trend overtime will be a flat or curved. >> not to mention the fed is shrinking its balance sheet. what are we going to see once we see this massive supply, demand imbalance and yield? >> that is probably the big question. possibly a driver of the weakness across emerging markets this year.

people are anticipating the reduction in the fed's balance sheet, a reduction in quantitative easing from the ecb. it will yield -- it will lead to high yields. auctions?out treasury we see so many that need to constantly keep funding spending. >> good point. we have another $1 trillion of issuance coming based on the deficit. that is another reason to expect yield curves to push higher and possibly a steeper curve in the short-term. >> we see a recovery. is that short-lived or is that something that could be opportunistic? >> we think it is an opportunity. e.m. has been under a lot of pain, but if you look at the moves, they are extreme. across emerging markets, they will overshoot and that creates opportunities.

you need to be careful because there are still stories that aren't that great. >> you stay away from deficit stories. is there a sense that it is momentum going against e.m.'s? thehe question would be slow picture. are people going to leave the asset class? we have see a -- we have seen a and whenying on e.m., people see negative returns, do they want to get out of the market? have we gone far enough that people are looking at it from a valuation standpoint as an opportunity? wild action when it comes to sterling. what are your assumptions? >> it is difficult to make assumptions regarding brexit. before the salzburg meeting, it looked like things were moving in the right direction. we has night -- we had nice movement on the eu side but have taken a few steps back.

my base case would be that there is some form of agreement, probably doma soft brexit route. that is being challenged at the moment. >> no matter what happens, when it comes to trade and other wedlines right now, brexit, can only expect more volatility. how do you trade this? >> you have to expect more volatility. we have been in a period of low volatility. that means you probably need to take risk off the table, maybe be more nimble in your positioning, be aware of forward-looking risks rather than looking at risk mac tricks .- metrics they underestimated the volatility over the next few months. >> which metrics are you talking about? >> if you think about volatility on the treasury market or the the move indices

have been abnormally low. you have to assume they will pick that up and build that into how you manage portfolios. you can't assume that the last few years worth of volatility will happen over the next few years. >> could the level of growth in the markets be sustained into next year? >> it could be sustained at the back end of this year and beginning of next year but as the fiscal spending rolls away, it is likely to go back to trends of growth, back from to 2% oree or 4% back 2.5% unless you get stimulus out of the u.s. here.d to have you you can interact with the charts we brought up on gtb global. catch up on key analyses and you can annotate them for future reference.

this is bloomberg. ♪

watching "daybreak: australia." the latest headlines, the markets welcomed to new iphones going on sale over the weekend. apple rose 1.5% on the back of each comments from investors. discounts should push sales, and citigroup sees positive reviews upsetting a lukewarm early reception. that helped shares recover when the new phones were launched. a new low after lingering concerns about a manufacturing a gas turbine. the company faces losing a $15 billion contract in iraq to siemens. jpmorgan lowers its

price target, and prices fell. the stock has slumped almost 9%. >> michael cores is near agreement to buy -- michael kors , with bertuy versace ace valued with vers at several billion dollars. versace have santo run the company since the murder of their elder sibling gianni. president trump is set to address world leaders at the u.n. general assembly. korea, talk about north and we have seen president trump meeting with president moon discussinguth korea, the inter-korea summit. we will give you a preview of the u.n. general assembly session this year.

that is coming up. this is bloomberg. ♪ xfinity mobile is a new wireless network

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"activecore, how's my network?" "all sites are green." all of which helps you do more than your customers thought possible. comcast business. beyond fast. >> it is 8:30 a.m. in sydney. markets open in 90 minutes. futures looking lackluster, a gray day in sydney. you are looking at the iconic sydney opera house. looking at early gains, about 0.1%. in new york, it is 6:30 p.m. fallw the dow and s&p 500 today as we had trade tensions and more political drama in washington. welcome to "daybreak: australia." let's get the first word news. jumped aftereuro

atv boss mario draghi said he saw a relatively strong pickup inflation. he says the bank remains on track to raise rates. he told parliament ecb projections show inflation averaging 1.7% through 2020, below the 2% goal but an improvement. measures of underlining inflation remain generally muted , increasing from earlier lows as domestic price pressures are broadening. underlining inflation -- underlying inflation is expected to increase further over the coming months as the tightening market pushes wage growth. >> jamie dimon says it could take a generation before angry taxpayers are ready to forgive the big banks. he says washington did the right thing to avoid another great depression, but admits it could take 25 years for people to

accept that. he says president trump is correct to admonish china on trade, but tariffs are the wrong way to go. >> the argentinian president told bloomberg there is zero chance of a default, giving continuing support to ims and others. he declined to give specifics but set a deal with the fund should be signed soon and should bolster investor confidence. the question of failure to pay debts has haunted argentina since 2001. >> the support we are receiving from countries, especially the united states of america, and the level of commitment my government allows citizens, with , it is axchange rate very competitive rate. we are balancing our foreign accounts. -- iran says the opec

meeting in algiers proves there is little support for president trump and u.s. sanctions. they sidestepped the president's demands for cheaper oil, saying they would react to market needs. sanctions are due on iranian oil in november as the white house seeks to cut output and exports to zero. iran says that won't happen. >> the united states is not capable of bringing our oil exports to zero. this is an empty promise. that is empty of credibility. perhaps on this path, we will sustain certain pressures but certainly, the united states will not reach its objective. >> global news, 24 hours per day, on air and on tictoc on 27 hundredwered by journalists and analysts in 100 20 countries. i am jessica summers. this is bloomberg. >> breaking news, let me talk

about the supreme court nominee brett kavanaugh, because we are hearing from the u.s. senate majority whip john cornyn that the second at user of sexual assault will be interviewed by a committee, but the kavanaugh accuser will be interviewed behind closed doors. mr. kavanaugh is waiting for confirmation to the supreme court. we are seeing assault allegations unfolding. john cornyn, saying kavanaugh's accuser will be interviewed behind closed doors. the world'ss on -- ipo.rpo the ceo spoke during an event in they were doing everything required of them, that every requirement is being met by aramco and they don't set the price, they are meeting

customer demand. there is some skepticism over what would happen to the ipo, expected to be the largest in the world at a time when oil prices are rebounding. the highest hit level since 2014. a couple asian markets are closed right now. south korea is closed, hong kong is closed. sophie is here with us on a holiday to check on the markets. sophie; we are committed to being here on the holiday. japan, returning from a long weekend. futures are nudging slightly higher, while the yen is holding steady after a three-day decline. in sydney, futures nudging lower whilst the talks -- while stocks are set to go higher. futures are signaling there could be a softer start on the --nese mainland admitted amid trade concerns. this, as leaders descend on new

york for the u.n. general assembly. they have concerns over protectionism, unusual for a gathering that usually focuses on geopolitics and security. we have seen korea's moon jae-in sign a pact with trump. service a template for japan when the second round of trade talks kicks off on tuesday? delayede reportedly from monday. japan will be seeking exemptions from auto tariffs, which seem to be the preconditions to enter bilateral discussions with the u.s. on tradings get more on asia. , lines developing over kavanaugh. the trade we have issues, as well. what does that feed into in terms of sentiment in asia? seee are probably going to

muted, a down day. you have hong kong closed. the market dropped yesterday. you have china and japan coming back. the focus will be on china after the hong kong stocks dropped with the you one yesterday -- the yuan yesterday. you also have the political developments that we mentioned, thrown into the mix. you have the fed coming up, investors will be looking at hawkishish or statements that may come out of that. you have the u.n. assembly going on. this is happening as investors are looking at starting to look risks.ns of if we could pull up the chart from the gtb library, we see the has expected price swings in the s&p 500. they are at a premium to actual stock moves. this suggests the market is becoming more cautious.

at the moment, we have low among s&p 500 stocks. at the same time, there is low volatility in the market and this is happening as investors are rotating in and out of sectors. may be caught off guard of sentiment turns. haidi: on indian markets, financial shares under investigation. possibly interesting moves on friday. >> that's right. the market regulator says it is examining some of the wild swings we saw in financial for any possible irregularities. it is looking at data from the nations biggest stock exchange, and may launch an investigation if it finds wrongdoing. we have a chart that shows the selloff deepened monday. you have $13 billion wiped off in this financial stock.

threaten what has been asia's best-performing stock market this year that has pretty much whether the emerging markets selloff. haidi: thank you, andrea. you can check out the charts she brought up in our gtb library on the bloomberg terminal. takingpresident trump stage at the u.n. general assembly as the world awaits critical u.s. decisions on iran and north korea. joining us is bill, who heads the national security coverage in washington. it is great to have you here. the u.n. general is simply happens every year. how important is it for the u.n. standing at a time when the u.s. pulled out of the human rights council? will we see no shows when it comes to heads of state? it is part of the multilateral system that is under strain. we talk about the u.s. withdrawal from the paris climate treaty, questions about nato's future.

it is one of these systems created in the post-world war ii era, but it is the kind of thing you have to replicate if it didn't exist. it is the one chance you get every year for nearly 200 world leaders to interact. but give a lot of speeches, on the sidelines, you often see deals being made on issues like the syrian war, trade, things like climate change and the iran nuclear agreement. shery: how much interaction with the irani and leaders, because i believe president trump was supposed to chair the un security council meeting that was supposed to be in iran but isn't anymore. >> the statement from the u.s. was this would be solely focused on iran and their behavior. the catch is, and i think u.s. officials caught up afterwards, first of all that would allow the iranian president to sit at the table across from president trump, confront him directly on accusations and their disagreement, and the u.s. was going to look isolated.

the u.k., other permanent members of the security council don't agree with the u.s. on the iran policy . they changed it to nonproliferation. it is something everybody can rally around. importantly for president trump, it means they are rainy and president doesn't have to be at the table. -- they iranian president doesn't have to be at the table. shery: we are hearing about another potential korean leadership summit. >> the u.s. started talking, president trump would like to have another summit soon. we don't know what that means, but secretary of state pompeo says he is making plans to find time to go to pyongyang. shery: president trump right now is meeting with emmanuel macron of france. let's listen in. >> we have had very good experiences, on occasion not so good but 99% very good. france is doing very well.

we are doing very well, and i think we are doing very well together. we have a lot of trade and we are discussing trade. we will discuss it today. we will be discussing military and defense and terrorism is a big subject we are always talking about. tonight,hy we are here more so than a most anything. and trade. i want to thank you for being here. it is an honor. we had a tremendous celebration at the white house a number of months ago honoring the andident and mrs. macron, honoring france. it was something very special. >> thank you. >> thank you very much, mr. president. i am very happy to be here with my delegation. let me express my deepest happened infor what your country. the french people feel very

america.your people in let me give my condolences. [indiscernible] i think we are here to deliver, and on this occasion of all these meetings, these meetings that will happen on wednesday will be a great occasion to deliberate our common security. we have a lot of issues in common, and i think terrorism, east, arehe middle things we want to fix and we want to work together. and you very much for welcoming -- thank you very much for welcoming us. we are very happy indeed. we were very happy on july 17 to welcome you for your wonderful trip.

we would be happy to welcome you again in november. thank you very much for being here today again. >> we had dinner at the top of the eiffel to our -- the eiffel tower and it was one of the most beautiful evenings you will ever see. thank you very much. >> thank you. >> thank you very much, everybody. much.you very >> president trump wrapping up his conversation with president macron. they will have a bilateral meeting. interesting to hear president trump say he has had good interactions with president macron. some not so. when they first met, we thought there was a bromance. things have soured a little. >> it would be interesting to be

inside the meeting. it is hard to know what they really agree on at this point. the u.s. pulled out of the climate treaty, that is something macron has supported. they have a transatlantic trade dispute. france is opposed to u.s. policy in iran, and france is a part of the u.s. has raised questions about. i am not sure what joint statement might come out of the meeting, but it seems they have more issues that they disagree on than they agree on. they do have a personal connection. they seem to like each other and get along. they will try to find a way to make something positive come out of this. top ofe is not typically the agenda, but is it unavoidable? >> it is. when you see what is happening between the u.s. and china, the trade war that has erected -- that has erupted, it has a lot of leaders at the meeting expressing concerns about the impact on emerging markets, global growth.

we have seen the imf warned about the impact. today, we heard comments from the president of south africa, the president of argentina, and even a top south korean official , saying the trade war could be one of the biggest problems the world is confronting over the next year. >> bill, thank you so much for your insights on the yuan general assembly and president trump -- on the u.n. general assembly and president trump. the world's biggest economies are digging in for what could be a long trade war. china responded to trump tariffs on another $200 billion on , targeting $60 billion in u.s. products. joining us is bill, senior at the center for strategic and international studies. great to have you back. i introduced this segment with

china-u.s. trade ties, but there is more happening, especially between korea and the u.s. we saw president trump and president moon jae-in sign an agreement. how much has the u.s. gained from that renegotiation of the agreement? >> it is good for the president because he accomplished something. this is the first agreement i have finished so he gets credit for that. change from the existing agreement. he got something on cars and steel. -- koreans were relatively made relatively modest concessions. it is good to have it in the rearview mirror, and expectations in washington these days are pretty low. as long as nothing bad happens, it is a good day. so far, this has been a good day. we have to be careful in terms of whether we extrapolate when it comes to the

renegotiated south korean trade agreement to a potential similar format for talks with japan, whether we will see a new nafta deal, and the big one, the trade dispute with china. is it too early to say this signifies a conciliatory tone from the administration? >> definitely. they are not being conciliatory. most difficult for a long-term economic cold war, which will produce a lot of collateral damage on both sides. it will call into question u.s. leadership in asia. it is hard to build a coalition to deal with china when you are insulting your friends and allies. the nafta outlook is brighter. we will see over the next couple days how far we get with canada, which is a difficult negotiation, but i wouldn't rule

out good news. doesn't want to enter into free trade agreement talks with us. they want us to richard -- rejoin tpa. i don't think they will persuade us to do that in the short run. i think they will continue to bob and weave. whether trump will threaten them with something more besides steel tariffs, i don't know. it is not a positive outlook right now. irritantsk about between traditional allies. this has been called the diplomacy of disruption. how much of this is destructive? goodwill -- how much of the goodwill has eroded to where it can't take place? >> they are doing everything backwards. you need to build coalitions, particularly for china. this is about china. tpp was about china.

ttip was about china. a is how to develop a strong rules -- a strong rules-based system about intellectual property theft, things like that that the chinese will have to adhere to if they want to access our market. it is hard to do that when you offend the people you want to bring into your coalition. >> it is interesting that you say ttip and tpp was about china, but the u.s. has withdrawn from both. what happens to the leverage u.s. wanted to have over china? >> we have given it away. he compounded that error by replacing it with nothing. i haven't proposed bilateral negotiations. i think is meeting was a success, and there may be a european negotiation, a small one, going forward. they seem to be engaged in an exercise of taking off the table

everything they can't agree on, which will leave something they can agree on, but it will be a small package. >> to the chinese make a mistake spelling -- did the chinese make a mistake spelling out that they may want high technologies, developing this part? they could have gone and done that strategy without announcing it, without causing tensions with the u.s. or others who encroachingmay be on their territory. >> i don't want to figure out what the chinese were thinking. it was not good for them internationally. it raised eyebrows, caused concern. thereport says, in identified sectors, we will create world champions that will put you out of business. that is not always well received. good reasonse been for doing it, and i wouldn't want to second-guess them on that.

>> is this an ideological battle? of what we saw in the relationship between the u.s. and japan? >> a lot of this is reminiscent, ambassador got his start in trade dealing with japan. some of the things he is trying to do now are echoes of what he tried to do then. that was a different time with different rules. there was no wto. he is pursuing managed trade remedies, trying to get countries to agree to quotas and voluntary export limits. that is harder to do than it was then. the rules make it harder and we have a world of global supply chains. everything is made everywhere now, and in that kind of world, it is hard to have managed trade. >> thank you, bill, for your time. trade tensions are having an impact on all corners of the

world. we spoke to the brazilian president, and asked if the trade were between washington and beijing is having any effect on his country. china is brazil's largest trade partner, followed by the u.s. our relations remain unchanged. thrived. evolved and i have met with my chinese counterpart, and when i came to the u.s. to my welcomed vice president pence -- when i came to the u.s., i welcomed vice president pence. there has been no impact on our trade relations.

ask if the dispute between china and the u.s. continues, how concerned are you that your first largest trading partner, china's economy will slow down? suchdon't have any concerns. there will be no such effect. [indiscernible] differences here and there are temporary and localized, and i have the impression that very soon, the u.s. and china relations will be solid and prosperous. i think we will all agree when he weighs, the debt on north korea and has a dialogue with north korea, we ared the message that all pursuing greater harmony

worldwide. the u.s. being a strong international player, a high-profile player, does have that responsibility. president trump [indiscernible] u.s. government officials will that responsibility. >> that was the president of brazil speaking exclusively to the businessget flash headlines. starbucks is planning and organizational shakeup to reverse stagnant sales. a memo from the ceo says the company must accelerate innovation. he says leadership changes will start this week and carry into november. shares had an up and down day, closing lower. >> plans to boost digital services will improve the profitability of banking operations and expand a customer five years.

the bank is looking at digitalization to boost consumer services and customer base among small to medium-sized companies. ocbc wants to trim the ratio to 40% from 43% during the first half of the year. xm's deal to acquire pandora may have struck a wrong note with investors. they suffered their worst stock plunge in seven years after announcing the acquisition. it offered few details about how the companies would work together, competing with spotify and apple music. on --s a most it for us almost it for us. trading in new zealand is getting underway. we are minutes away from the opening in australia, where we start.king at a tepid south korea and hong kong, off for the harvest and mid-autumn

holidays. a muted session in new zealand, as we see a selloff among the kiwi dollar and aussie dollar, the two biggest losers against the index overnight. a worsening trade situation with time -- with china. outng up with -- coming with -- we will continue watching some of these headlines coming out of the yuan general assembly where you are. shery: president trump, addressing leaders tuesday. last year, he made strong threats not to mention that he kept saying he wants more sovereignty respected among countries. we will discuss this with bruce be asking himl about japan-u.s. relations. we just heard the trade talks between japan and the u.s. have been postponed for tuesday at the earliest. "daybreak: is it for

australia." stick around. shery and i will stick around as the asian markets and china markets come back online. ♪

haidi: a very good morning. asia's major markets are one hour away from the open. shery: good evening from bloomberg's global headquarters in new york. sophie: welcome to daybreak asia. haidi: our top stories, trade makes the headlines once again in a few deal with south korea -- new deal with south korea. the tension is still there as tariffs could send the rising dollar back down.