>> a very good morning. i am haidi stroud-watts in sydney, where australian markets have just opened. shery: i am shery on. sophie: and i am sophie kamaruddin in hong kong. welcome to "daybreak: asia." haidi: theresa may clings onto power after winning a conservative vote for confidence, but her brexit headache will not be going away. china may delay its global tech ambitions as the u.s. calls on

beijing to do more. recent trade war optimism is draining away. tencent music it's a good note on its first ipo day in new york. let's get you started with a quick check of the markets close in the u.s. a risk on day for equity markets as the dow gained .6% and the s&p 500 gained the most in a week. more positive sentiment coming from more positive headlines on trade. prime minister may surviving the no-confidence vote. the nasdaq also gaining for the third consecutive session. s&p futures not doing much at the moment, but the narrative throughout the session was on trade and brexit. the risk of a hard brexit rising. prime minister may facing that challenge to her leadership. but sterling now looking like this after falling to the lowest level since april. throughout the session, it gained more than a month.

sophie? sophie: we do have political and trade developments to consider in asia. also the eu and japan approving a draft fda deal that eliminates virtually all tariffs. but the fallout from the traits that -- trade spat between the u.s. and china continues to be felt. american retailer men's wearhouse saying it is cutting products sourced from china by half. taking a look at the start of trade in sydney, little change for the asx 200 after a two-day gain. keeping an eye on cpg and hutchinson in particular. more potential moves could be had for the regional telco space. this is japan. reportedly calling businesses to avoid buying communication and equipment seen as vulnerable to leaks and shutdowns. that could impact huawei and zte. haidi: sophie kamaruddin in hong

kong. theresa may remains prime minister after surviving a vote of confidence in her own party. she survived by 200 votes-117 in a secret ballot. pm may:. our renewed mission, -- here is our renewed mission, delivering the brexit that people voted for, bringing the country back together, and building a country that works for everyone. >> theresa may survives, but the brexit chaos is far from resolved. let's get over to sebastian salek. the only reassurance is we don't see this for at least another 12 months in terms of another no-confidence vote. it does seem like she is significantly weakened in her leadership position and nothing much has changed in terms of her challenges. sebastian: there are many ways , peopleing this one across the party and outside of it interpreting it in different ways.

it does seem like a weakening of her position that there are 117 people in her party that do not back her leadership. as you say, it is not business as usual. she was due to go to dublin today. she is going to brussels tomorrow to speak with the european commission to try and win some concessions for her brexit deal. the big sticking point is the irish backed -- she said in her speech she noted the dissatisfaction and will seek assurances that eu leaders say they will explore further assurances. there is some level of conciliation from them. we had a tweet from the chancellor of austria. he said he was keen to avoid a hard brexit. that may be the negotiating position she can take and say, as things stand, this deal is not going to pass and a hard brexit is becoming increasingly likely. that may be enough to scare them to give her the little bit more

she needs to get not just people on her side, but also the northern irish parties better propping up her government. they are crucial to get on board if she is going to get the numbers she needs to get brexit through parliament. >> from the vote today, we saw that 117 mps could vote against the brexit deal. what happens if there is no agreement in parliament? sebastian: at that point, there are several options. remember, the clock is ticking. we are heading to march 29 regardless of what happens. if may can't get the deal through, there is the possibility of a no-confidence vote from the labour party. that is allowed because that is a no-confidence vote in the government rather than make herself. no surprises anymore, but anything could happen if she cannot get the vote through parliament. her aim is very much that this is going to happen. haidi: thank you so much for that. let's get the first word news

with jenna dagenhart. jenna: president trump's former lawyer and fixer is headed to jail, still pledging to give financially damaging information to prosecutors. michael cohen was given three years after failing to win the leniency he sought. he accepted responsibility for his crimes, saying "it was my duty to cover up donald trump's dirty deeds before the 2016 election." the white house declined to comment. canada's foreign minister says the government is no longer in contact with the second canadian citizen being questioned in china. earlier, the minister confirmed former diplomat michael kovrig is in detention in china, whereabouts unknown and without diplomatic immunity. beijing says he is being held in relation to a national security investigation but defined to offer more details. the new governor of the reserve bank of india described himself as a consensus builder as he defended the institution's

autonomy to investors worried the government wants more control. he is the rbis third leader in as many years and that -- and said he would uphold the integrity and could ability. he was a key part of narendra modi's controversial cash ban. the man suspected of killing three people in strasbourg remains on the run with police saying he had a long criminal record. the 29-year-old was first convicted at 13 years old and had a string of police records across france, germany, and switzerland. in total, he had 27 convictions and was well known to police and france's equivalent of the fbi. 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 am jenna dagenhart. this is bloomberg. shery: commerce secretary wilbur

ross dialed back the assertion that president trump might intervene in the huawei case, saying the decision has not yet been made. as we just heard, things have been further complicated by the possible detention of a second canadian citizen in china. let's get the latest. it was really confusing at a time when trump trump administration officials were trying to separate the huawei case from trade talks, and you have the president linking both of them together. what is the latest now? >> ross's comments were an attempt to go back where they were before trump's comments. he made it clear he did not know what the president was going to do. he said, we will have to wait to see what decision he makes. that decision could have broader implications than this case or the china trade talks. it could affect the way other countries deal with u.s. extradition request.

it potentially could have impact on other countries using detention as a tool of foreign policy or trade, which is something that the united states is generally, through its modern history, sought to tamp down. making these things separate. the u.s. -- other aides to the president made the point that the prosecution and trade talks are two separate tracks, and in fact ross said today that china has -- up until now at least -- regarded them as separate issues as well. where that goes from here probably will be some additional clarification from the administration coming out. again, nobody knows what trump is ultimately going to do. >> just in the last hour, we had news that the canadian foreign minister confirming canada had been contacted by a second canadian citizen being

questioned by chinese authorities after the detention of a former diplomat earlier this week. drawnr governments have the conclusions or connections in these cases, but it is not hard to see this turning into a tit-for-tat situation relating to huawei. joe: right. remember, it is canada holding the huawei executive and who would have to respond to any u.s. extradition request. nobody has really connected the dots, but there is some proximity that one could readily draw some conclusions from that. it is something that has been a concern for specialists in this area of law, as well as probably other business executives in the u.s. who might be traveling to china. >> finally, michael cohen heading to prison for the next three years. the former personal lawyer for president trump. give us some more details on this court ruling. joe: one of the things it makes

clear is there might be additional trump associates who could be in trouble. there are indications in the court filing that other officials on the trump campaign were involved in efforts to pay cost money to these women -- to pay hush money to these women who alleged they had extramarital affairs with the president. there are a few more shoes to drop from michael cohen's prosecution. he said he would cooperate with the special counsel investigating the campaign. >> thank you so much for that, the bloomberg congress editor. we are going to get to sophie kamaruddin on the markets in hong kong to take a look at one of the moves in the sydney session. flagging concerns about a merger between vodafone, hutchinson australia, and tpg telecom. we are seeing tpg moved to the downside in reaction. sophie: that is the case. tpg shares sliding nearly 19%

this morning and hutchison taking a massive hit, down 35.7%, trading at around five all the sense -- five aussie cents. regulators raise concern about the merger, citing reduced prices as the mobile market would have only three major players. tpg has acknowledged the statements and remains confident the merger will happen, but investors not looking confident, as you can see. stocks in both companies have been unable to sustain the single day pop on august 31 the merger was announced. a sustained decline for both stocks today. haidi: thank you so much for that. still ahead, china's ambitious made in 2025 program has been a thorn in the trade council between washington and beijing. it could be the latest victim in the trade war. krane fund's advisers will weigh in. shery: first, michael hans will

give us his view on the market implications of theresa may's confidence vote. this is bloomberg. ♪

>> this is "daybreak: asia." i am haidi stroud-watts in sydney. shery: i'm shery ahn in new york sterling racked up its biggest gain in six weeks after theresa may survived a no-confidence vote. let's look at the market implications with clarfeld financial ceo michael hans. great to have you with us in the studio. this function on the bloomberg, showing the volatility on sterling. what it really shows is the demand for sterling really exceeding that for sterling costs. we are seeing this red area on the curve showing the bias towards a weaker pound over the next six months. how difficult is it at this moment when you have no authority over what happens in

the u.k. to trade anything in that area? guest: fair question. it is having a sizable impact of cross currency markets. if you think about the u.s. dollar, for example, we are in a position where the fed has softened up their rhetoric. we have seen interest rates fall in the u.s.. one would have anticipated that could theoretically soften the dollar, yet the dixie is still trading around its highs for the year. these moves in currencies are making it more difficult to interpret the magnitude of moves across markets, across various geographies. it is compounding not only for the u.k., it is adding implications across the globe. shery: the s&p 500 seeing a lot of volatility. i believe this was the seventh consecutive session where we saw at least 1% moves on the s&p 500. is volatility going to have a long-term impact on returns? beyond where we

are right now over the next several months, probably not. yeare coming out of a where we had low levels of volatility and returning to more normalized levels. as much as we have seen these swings, they have been occurring in a fairly narrow band on the s&p 500 for the last two months. opine onficult to where we ultimately find support, but as we transition into next year, a lot of volatility will dissipate and what will drive that is more clarity around big-ticket items, notably the federal reserve. where they have downshifted expectations for rate hikes. as we get closer to their meeting next week, we might have clarity. other central banks, the ecb tomorrow, we are seeing some concrete steps related to the negotiations within the u.s. and china. i think that will be a big deal because elements like the terrorists -- like the tariffs

being kicked down the road and brexit being pushed off, the challenges uncertainty. as we get clarity, it will allow the market price. >> how much would you say the market has already priced in a worst-case scenario when it comes to people saying a disorderly brexit is looking like a possibility by the middle of next year and that the trade war is another thing that will be a long-term source of tension between beijing and washington? guest: it depends on the area. we have seen considerable panic across many european markets throughout much of this year already. to answer that question, more so overseas than what we are seeing here in the u.s., because we are fairly insulated and markets did not really care about some of those items until we started seeing some weakness. from our perspective, much of the reason the market came under pressure was that we broke out key levels of support in the broader u.s. markets. that really shifted into

concerns around a global slowdown. again, that is fairly rational because we are coming off a sharp, strong boost from fiscal policy in the u.s. and we have repriced accordingly. which theoretically sets up the markets for a better outcome in 2019. have we continued on that upper trajectory, ignoring any semblance of risk overseas? shery: appreciate your time, michael hans, clarfeld financial advisors ceo. you can get a quick roundup of the stories you need in this edition of daybreak on thursday. subscribers, go to dayb on your terminals. it is also an available on your mobile in the bloomberg anywhere app. top story, theresa may sticking around for now. ♪ ♪

>> the u.s. senate is sending saudi arabia a message of disapproval over the killing of jamal khashoggi. senators advanced a motion that

orders the president to withdraw military support for saudi involvement in the civil war in yemen. bloomberg's chief washington correspondent spoke to republican senator rand paul. we are addressing the situation in the senate and doing something historic. -- ais a revolution resolution that says we will not be helping the saudis and the war in yemen. this might be the first time in the history of the country that a body of congress -- a majority will vote to say to the president, we are not at war with yemen, not at war with saudi arabia, and we don't give you permission to do so. this is an historic procedure. has not happened i think in our history. kevin: it hasn't happened at all. what do you make in terms of how it won't be moving forward in the house? sen. paul: it used to be a privilege motion. that means anyone can bring it to the floor. that's how we are having the vote in the senate.

this is a great way to have a motion, because what happens typically is leadership on both sides of the aisle stifles things like this from coming forward. that is what they are doing in the house. we are going to have new leadership come january. if i were sending a message to saudi arabia tonight, i would of this is a historic rebuke what saudi arabia is doing in yemen and what they did in killing khashoggi and they are on notice. if they keep behaving the way they are, bombing civilian centers in yemen, come january this comes back up and i think we will get to a vetoproof majority on this, saying no more arms to saudi arabia. saudi arabia needs to set up and wake up because this is a significant rebuke. kevin: it sounds like you are not just sending a message to saudi arabia, but also different from. you are saying -- but also to president trump. you are saying you believe you will have a vetoproof majority

to get the resolution passed. sen. paul: i think it depends on saudi arabia's behavior. if they find a peaceful solution to yemen, that would go a long way towards defusing the situation. the problem is with their barbaric dismembering and murdering of khashoggi, it is very hard for them to get beyond that. i think the only way they truly can is choose new leadership in saudi arabia. i do not think we should reward them with arms. selling arms is a reward that should go only to our closest and best allies, people who share our values, who do not murder dissidents and do not keep thousands of people in prison without trial in their country. kevin: the president has made several arguments about why the u.s. ought to continue to support saudi arabia, including a supply chain economic argument , but also saudi arabia has become the largest oil exporter and recently became the top crude supplier to china.

what do you say to folks who said if the u.s. arms its relationship with the saudis, you are providing a backdoor for china and russia? sen. paul: i am not asking for an embargo of saudi arabia, not asking to disrupt the oil trade. i am saying we should not reward them with arms. i don't think we disrupt anything by doing that. i think this is a good first step, to say we are not going to sell you arms, not going to aid your behavior in yemen, killing civilians. i don't think that in anyway disrupts the trade of oil, either in the middle east or abroad. kevin: as we go forward in terms of looking at the u.s. relationship with saudi arabia, you and your colleagues on both sides of the aisle have raised concerns about the saudi crown prince. do you have any hope at all that he might be able to change his behavior and repair the relationship with the united states? sen. paul: my fear is that we have seen such erratic behavior

from them. they have a blockade on qatar, a war in yemen. they killed an american resident, a journalist and a dissident. this kind of behavior is not brand-new. their involvement in the syrian civil war. they indiscriminately were sending arms to people who hate us and israel and people who are not our friends. al-nusra, al qaeda elements were getting arms from saudi arabia. saudi arabia really has a long history, but it has gotten worse over time. probably saudi arabia is the largest state sponsor of radical islam, radical jihad against civilians. the hatred of christians and jews and hindus has been coming out of saudi arabia for decades, and they have got to shape up. something has to change and the only way they are going to get it is if we act strongly. i think if we act in a week way

and send a resolution saying we disagree with killing him but will look the other way, that won't be enough. the only thing the saudis understand is strength and the only strong position is, quit selling arms or at least suspend for a period of time. kevin: switching gears, we are on the eve of another partial government shutdown. are there any development in terms of getting to some resolution? sen. paul: they always find a deal. some deal will be made and government will stay open. ,n keep an eye government open realize the government will spend $1 trillion more this year than it has. so i am not a big fan of the way we spend money in this country. i am not a big fan of these end of the year deals in the sense that they keep government open but continued to weaken us as a government as we exceed $22 trillion in debt. >> rand paul speaking with kevin cirilli.

coming up, china could be planning to push back its ambitious made in china 2025 targets to ease tensions with the u.s.. let's take a look at what this means for the future of tech and electric vehicles, next. this is bloomberg. ♪

haidi: 10:30 a.m. in sydney, markets trading for about 30 minutes now. the main benchmarks trading up just by about .1%. a little bit of optimism although we did see for a full session where u.s. investors faded into the close in the afternoon session to start halving theames -- gains. shery: s&p futures higher than .1% as heidi mentioned. we have seen more volatility last couple of days. we have 20 of uncertainty including a potential government shutdown next week. i'm in new york. haidi: and i'm in sydney, you

are watching daybreak asia. let's go to first word news with jenna. enna: theresa may remains prime minister after surviving a vote of no-confidence. 200 to 117 and cannot be challenged again for another year. leaders on thursday have said they won't reopen negotiations and the vote still leaves may with the daunting task of trying to force her deal through parliament. >> i and grateful for that support. a significant number of colleagues cast vote against me and i have listened to what they said. following this ballot, we need building ahe job better future for this country. the iranian oil minister has joined twitter saying he was

better communication at home and abroad. the platform is banned in iran but is increasingly used by authorities including residential honey and foreign minister. twitter fore joined a more dynamic and effective relationship with his domestic and foreign audience. china's plans to dominate high-end tech may be a victim of the trade war. beijing may postpone some of the by ain china 2025 program decade although a final decision hasn't been made. energy, he has been one of president's main targets. it's not clear how much of the delay has been communicated to washington. $3 billion agreed to build satellite headquarters. crumbling,system is there is record homelessness, and many people have no access to health insurance.

but the world's richest company is still being -- still offering a testing incentive. global news 24 hours a day on air and on tictoc on twitter powered by more than 2700 journalists and analysts in more than 120 countries. i'm jenna dagenhart. this is bloomberg. shery: positive headlines on trade, not to mention prime minister theresa may surviving that vote of no-confidence helping to boost the market. if all of that positive momentum is filtering through asia, sophie? sophie: we had discretionary and tech shares helping leading. -- leavd the gain. there is an overly cautious approach when it comes to the market. sliding that segment down to

2.8% and you have the likes of telstra dragging. , lucyl check in on tbg stocks sliding along with hutchinson which is down by 25%. you have regulators citing reduced competition and being concerned with the mobile market. three major players rather than the foreign. they remain confident that the merger will be completed but investors are disengaging. tbg slumping the most since september 2016. as you can see from the chart right here. take a look at some other movers in sydney. iowa holdings trying to salvage deals to buy in the pensions. we are seeing some building materials company gain ground like gwa. rising the most since june of 2016 is another analyst raises

to neutral. adding lenders as we get more info on the brexit front. in beijing, they may push back plans for high-tech domination by a decade as it tries de ease tensions with washington. -- two ease tensions with ease tensionsto with washington. a more strategic part of the trade war, isn't it? is there any indication that beijing may be backing down from its huge ambitions to try to smooth things over with washington? >> this will be a significant to pass. it comes i am in the headquarters of one of china's leading electric vehicle makers.

had an interview with their ceo and we will be talking about that shortly. are part ofke this that because the focus in china is developing sectors around vehicles, around a, robotics, and biotech. as you say, we have had reports that they are considering we working that to allow greater access to foreign companies. according to our sources, it may be delayed by a decade to 2035. china,moves from potentially cutting tariffs on u.s. autos from 40% to 15%. and building on that intellectual property framework to try to address concerns. this is another move to address core concerns in washington.

the question is will this be a cosmetic change from beijing, whether they can prove and convince those in washington that these are substantial changes that they are looking to make. vehicles andmous autonomous driving central to china. you have been talking to one of the leading ceos -- to one of the ceos in the leading startups of this area. what did he have to say? tom: it was a fascinating with the founder of one of the startups, backed by the likes of alibaba. they raised about 1.4 billion u.s. dollars in funding. they unveiled and handed over their first model, the g3 to some of their customers. they plan to ramp up production's the in the next year. and they are taking on tesla factoryns to build a

outside of shanghai by the end of 2019. take a listen to this conversation i had. ng motors, the investment ratio to r&d is higher than our peers. we need to deliver 400,000 vehicles to breakeven. being ayou see xpeng serious contender versus tesla in the chinese market? >> i expect we will be able to compete with tesla in the global markets in the next couple of years. is there a risk of overcapacity in china's electric vehicle market? will we get to a point where there is rapid consolidation? see ahink we expect to process in two years or more. i think this will lead to bigger

companies. tom: is the financing environment more challenging for a company like yours? he: there is abundant free capital out there. is a new and smart industry. we are seeing many investors that are interested in it. they are more cautious than before. tom: the chinese government might do a favor to tesla by cutting the tariffs from 40% to maybe down to 15% as a result of these trade negotiations. is that a setback for xpeng? do you lose an advantage? he: we hope the government will lift subsidies and tariffs. it could benefit us in the short-term, but in the long term, it would damage us. company were a tech focused on ai, cloud services, autonomous driving.

these are areas looked at in washington and there is concern in the u.s. about how china is trying to advance in these areas. mindoes that way in your -- on your mind? and how does that factor into strategy for the company? xpeng motors has 3000 r&d staff. 98% are based in china. almost all r&d like ai and a time of the striving, cloud, and the data was carried out in guangzhou, beijing, and shanghai. i don't think it has been a big impact on our self developed technology. building the brand in ensuring that they have the quality in terms of the build of the car. we did a test drive yesterday. it has a time as an ai powered components like self driving and so parking, i should say.

they also need to make sure they can ramp up manufacturing productions so they can reduce the cash burn. they have 12 months to 24 months of financing. they do not have an ipo plan. estimates,o some fewer than 1% will survive and there will be consolidation. and heed about that, expected to take place -- expects it to take place. shery: to discuss the chinese tech market, we bring in the .anaging partner we have seen a lot of volatility in the tech sector in china. but despite all this, analysts were hopeful that given the chinese government's focus on this sector in the made in china 2025 policy, it has momentum going forward. there are reports that they could delay that for a decade or so? is that a possibility?

what would that mean for the sector? mark: the report started surfacing today. i think that number one, with all of these points, we have to see what actually happens. there are a lot of points talked about every day that swing the market around. the momentum, i believe, will stay with the chinese companies. i am sure they are compromising in thinking about compromising with the u.s. at this point. ipt is the main issue, the and made in 2025, the autonomous driving. to this point, i have not seen any indication of slow down because it is just starting to be talked about. i think it might be very good

for chinese companies because their technology is world leading technology. and i think if they are able to compete in an open space, they will prove themselves to be better than some of the doubters think. as the market opens, it will benefit perception of how good chinese technology companies have come -- become. i mentioned volatility in the tech sector, so this chart on the bloomberg has shown how they have underperformed in the u.s. the second panel, we see the correlation between chinese and u.s. tech starting to rise. is this more of a positive outcome given the trade tensions seem to be in these sectors on both sides of the world? mark: in april, the two sectors started to come apart.

you can see it in that charlie just showed. -- chart you just showed. you saw that in trump's tough talk on trade. the correlations blew out to a largest point around august. storm arethe perfect you have the government trying to engineer a slowdown with structural deleveraging. and you have the trade war on top of it. you have many macro headwinds in the face of the economy. china's sentiment was very poor as well. they kind of discounted a lot of bad things very quickly. now, u.s.ppening stocks are realizing they are at risk of slowing down because of this trade war that is not getting resolved prior to 12/1 with the g20 talks.

we are at a historical widespread. that has been more narrow. my guess is you see china start and thatform u.s. tech spread will probably come back to some normalization. whether it is china going up a lot more or the u.s. coming down, but they will probably be somewhere in the middle -- meet somewhere in the middle. take a look at tech and it is the end of a busy but challenging year for chinese tech ipos going public. do you expect that environment to go public -- mark: it was a good sign that tencent went public and was able to complete the ipo today. it had been delayed since october.

step away and say that this was a really good outcome for tencent. a great outcome for tencent music. deal priced at 13 which was the low end of the price range. they had given a 13 to 15 range. 22 billion to 25 billion market cap. i think they priced conservatively and gave long-term investors a chance to get a nice allocation. 14 on probably 62 million shares today. all in all, it wasn't a huge upside, but it was a very well and it is a huge positive for tencent to be able to expand that at this time. i think two weeks ago, we would not have thought there was any chance of them coming this year.

they got the deal going. the roadshow happened last friday and the deal is done. overall, for volatile december, this was a very good outcome. maybe a sigh of relief as we get to the end of a very difficult year. mark, managing partner -- --aking news brought sing crossing the bloomberg. u.s.ans according to soybeans, it is council that happened over the last 24 hours. it began on wednesday with reports of traders that 500,000 already been placed. the ceo of the council saying the shipments expect to occur during the first quarter of the year.

most of the surprises from the pacific northwest. they made purchases and we do know that ever since early july when the retaliatory tariffs were slapped on by china, these soybean purchases from china have essentially dried up to zero and u.s. funds have been struggling with excess stockpiles. we have seen prices jumping to a five-month high. this is bloomberg. ♪

shery: central banks around the world will be in the spotlight again with policy meetings from the philippines to germany and the debut of the resort bank of india. kathleen hays is here, so let's start with the r.b.i.. a news conference on the first day on the job? kathleen: is--

messages, trust me. for personal reasons, a move that surprised everyone. clearly, he is trying to tell the world that i am the right guy. a press conference held on his first day of office. >> the r.b.i. is a great institution and has a very long legacy. a very rich legacy. i will do everything that is possible. i will try and uphold the professionalism, the core , ands, the credibility more of the reserve bank. kathleen: his supporters agree he might have a bit of an uphill battle convincing investors. for example, he was the one that -- will he do the government's bidding when it comes to banks and bank capital?

something the government is pushing the r.b.i. to increase while they have pushed back. of hisfirst test conciliatory approach, he believes in building consensus, and that comes as a member of the broad group of board members and the reserve bank of india where the government will see what kind of stand he takes there. that is when we will get a sense. where does he stand on bank capital? what is his team pushing for. no policy tweaked expected. what are we looking out or? -- out for? kathleen: all of the bloomberg economists say that they are going to stop this time. pointsve hiked 175 basis to fight inflation. echohey going to pause the

after hiking so much, if you look at the green bars, even come down from 6% plus. the problem is that inflation risk is expected to mount starting in january where there is new tax hikes on oil and cigarettes. bsp -- in their policy statement, what will a signal? note, they will stay .n guard too early to take a rate cut. haidi: kathleen hays taking and i -- with us, keeping an eye on the philippines. ,n the chart, showing g tv these charts are featured on bloomberg tv to catch up on the analysis. and you can save charts for future reference.

this is bloomberg. ♪

haidi: this is daybreak: asia. shery: we are looking ahead to market opens in japan and south korea. futures are pointing higher for both soul and a tokyo as u.s. futures also tick higher. it look like gains may be extended with the topics rebounding from an 18 month low with the yen holding steady. it we are keeping an eye on japanese telcos as well. will avoid communications and seen as vulnerable. that could be an opportunity for 5g players like nokia, ericsson, and km w in korea which is nokia's biggest supplier. towould also be a boon

samsung. facing headwind in china with a sluggish performance there. the staff a close one of the mobile phone factories. the start ofd be production to be moved out of china as apple suppliers are set to it or making iphones away from the mainland if the u.s. increases tariffs to 25%. and tech stock may go today as fall, and apple ramp up their patents. -- as qualcomm and apple ramp up their patents. australia is online, some gains to get into the first hour. up about .1%. tech stocks are gaining. new zealand shares are extending the rally. asia,ks like the rest of tokyo, and soul come online and aswill build on this rally more optimism swells around trade negotiations. china is said to be pushing back the china 2025 strategic tech

ambitions as well as the announcement that soybean purchases to the tune of 1.5 million to 2 million pounds have resumed out of beijing. this is bloomberg. ♪

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haidi: a very good morning. asian markets are just open for trade. shery: in new york, i'm shery ahn. sophie: and welcome to daybreak asia. haidi: theresa may clinging to power after winning a conservative vote of confidence and of brexit -- the brexit no headache want to go away. aging --lling on

beijing, but soybean purchases are rising. the latest startup to change the market leader. british prime minister theresa may reviving the no-confidence -- surviving the no-confidence vote could be adding to moment in. -- momentum. how are we looking at come -- how are we looking? after: adding .7% japanese stocks rallied from an 18 month low on wednesday. tech shares or leading the gains so far in the region. this is around news about apple and qualcomm as well as how way -- hauwei. in tokyo andds sydney. raise concerns around competition on the plan for

vodafone hutchison. we are seeing u.s. futures pick up and we see the yen hold steady as sentiment is improving with offshore you want as china consideringhina is dropping tariffs. and the brexit struggle is far from over. haidi: sophie kamaruddin on the markets. ofi mentioned, one sign relief is theresa may remaining on as u.k. prime minister, surviving a vote of confidence in her own conservative party. votes.vived by 200 here is our renewed mission. delivering the brexit people voted for. bringing the country back together. and building a country that

totally works for everyone. theresa may survives for now but the chaos is far from resolved. let's cross over to london where sebastian is. may survives to fight another day but the uphill challenges remain when it comes to her getting a brexit deal. she goes back to the eu council where she will try to make further progress to sweeten the deal. sebastian: that is progress she needs if she's going to get it through parliament. 117 people don't back her leadership. it doesn't translate directly to people that don't back the brexit deal but an amount can be inferred from that. one possible bargaining tool is the risk of no deal. we will get that on march 29 if nothing else is agreed. the eu doesn't want to see that happen. the summit of conclusions, eu

leaders saying that they will explore. toneghtly conciliatory there. they will not fear too far from what is already being agreed. tone there. the north irish party is currently popping -- propping up the government. she needs to get it through parliament she so desperately needs right now. shery: we saw the biggest gain in more than a month. really, brexit headlines have been rattling the u.k. market for the last few days. sebastian: they really have. and if you look at the pound, you see that big dip in the last three days. and something that has been going on for a long time. they are really watching the

on if it will be a hard or soft brexit. may goingf theresa and you see that less than slightly today with her sort of consolidating her position. and that is what is behind the gains you seen today. let's get to first word news with jenna dagenhart. formerpresident trump's lawyer and fixer is headed to jail, still pledging to give damaging information to prosecutors. michael cohen was given three years after failing to get the leniency he sought from robert mueller. he accepted responsibility for his crimes, saying it was my duty to cover up donald trump's dirty deeds before the 2016 election. the white house declined to comment. canada's prime minister says the

government is not in contact with a second canadian citizen questioned in china. in former diplomat is detention in china, his whereabouts unknown and without diplomatic immunity. they declined to offer more details. describedvernor himself as a consensus builder as he defended the institution and investors worry that the government wants more control. he is the third leader in as many years and said he would uphold the banks integrity. part of the international cash ban two years ago. people say he had a long criminal record. the 29-year-old was first convicted at age 13 and had a string of the lease records across france and in germany.

it in total, he had 27 convictions and was well known to france's equivalent of the fbi. air and on tictoc on twitter powered by more than 2700 journalists and analysts in more than 100 20 countries. i'm jenna dagenhart. this is bloomberg. plans china considering to dominate high-end technology as it wants to ease trade tensions with the u.s.. stephen engle has more. talking about this program called made in china 2025. -- could thiscome become china 2035 now? stephen: that is what sources are telling bloomberg news. other hallmark initiative but made in china 2025 was the killer of xi

into ai, drive , and othernergies high-tech industries that would put it in direct competition with silicon valley and the united states. hearing that some of those elements could be delayed to 2035 if that would ease some of the attention of the u.s. the trump administration again signaling that beijing must do more to end the trade war. agreeing to deadlines, and enforceable actions. the white house has been beijingly arguing that unfairly subsidizes chinese companies and steals american intellectual property. and that is at the heart of america's opposition to made in

china 2025. some say there is a bit of pledge fatigue and the proof will be in the pudding on essay delay these initiatives. -- on if they delay these initiatives. talking about political leverage, we know that in terms of the former diplomat that was diplomat the former the taint, there was not a -- bution between that now we hear of the second detention of a canadian in china. stephen: christian freeland is saying that a second canadian with authorities, questioned by chinese authorities. has been unable to be contacted. there is fear that he has been

detained in china after we got news yesterday that former canadian diplomat is the canadian foreign service. michael has been detained. national security investigation. they speculated a tit-for-tat retaliation. neither country, canada or china have can armed the connection between the 2 -- have confirmed the connection between the two. we heard that donald trump yesterday may intervene in this standoff to help broker a deal on the trade front with china. people says that raise a lot of alarm bells because that puts other americans abroad in danger of also being detained. the u.s. is willing to negotiate

and they will get political leverage. and they will take americans hostage. you have heard chinese business leaders say that people traveling to the u.s. or to america should be concerned or maybe reconsider those trips as well? this comes as a knock -- at an awkward time as trade tensions seem to be improving. soybean purchases in a substantial volume have restarted this week. stephen: that's right. it we just got news from the u.s. soybean export counsel saying that china has just placed another very sizable order for soybeans, resuming the --de, putting the terrace tariffs on end. between 1.5 tons to 2 million tons of u.s. soybeans, on top of a bloomberg news story.

china is going to the cabinet what donalding trump had tweeted earlier, the on u.s.will cut tariffs made autos by 25 percent from 40% currently down to 15%. progress, but the white house is sticking by the assessment that not enough progress yet. haidi: stephen engle in hong kong. still ahead, how these tensions are affecting one chinese ambitious plan to be the electric vehicle tesla killer. shery: the latest market moves as theresa may claims power. this is bloomberg. ♪

this is daybreak asia. i'm shery ahn in new york. the pound solid biggest

one-day gain in six weeks after theresa may survived a bid to topple her. let's get to market news around the world. i am loving this bloomberg opinion piece titled, the sterling really is destiny's child. she is a survivor. to what end? you look at the numbers and she will come out of this politically weakened. >> that is the modus operandi, to klingon by the skin of her teeth -- cling on by the skin of her teeth. facing a compromise deal, this sort of deal -- the sort of deal that nobody likes. when she won the election to be head of the tory party, to the confidence -- she got 200. she has kind of added one

supporter. rose when itpound became apparent she wasn't going to go, when the margin was shakier, the pound came back. and i think that tells us it will be tough for the pound to go to much higher. some concessions from the eu because otherwise, how will she get anything through parliament? and how to ,he avoided confidence vote even it she could survive the conservative party challenge? she is a little bit weaker and investors have to think is this a lame-duck prime minister? although she says she's not going to leave. garfield: if that helps, if she is a lame-duck, we are stuck somethingnless

dramatic happens. and if something dramatic does happen, how are we sliding inexorably toward a brexit march next year? out there isainty uncertainty and perhaps the only attractive part of this sterling conflict is volatility. that volatility is felt everywhere across the world. not only when it comes to affect markets but equity markets. garfield: yes. the single biggest reason for volatility is because equity traders are finally getting used to the idea of what is often referred to as two-way price action. fall, sustainably, as well as climb. whereas in the last couple of people thought stocks would eventually go back up.

would beanything else a pause that offered you a chance to reset and give you a better shot at gains. bigger gains. ,s we are noting on the blog the zeitgeist has moved toward sell the rally rather than by the dips. our life asia team leader with a look at what to expect. follow this story in the days trading action there on the market live log. , commentary and expert analysis to find out what is affecting your investment right now. 2019 could be a tale of two halves. has seen a more stable second half.

we discussed with the head of asia equity research, joining us out of hong kong. .hat is the basis volatility is here to stay going into next year. we are also seeing some of the global growth indicators and economic macro picture looking a little bit dollar going into next year. is that your assumption? the reason for heightened volatility in the first half is that a majority of these volatility inducing even spurts globally and locally are possibly concentrated more in the first half and in the second half. if you look at the global even's , you know the 90 day deadline or even more locally, we had thailand, and

indonesia. they are all concentrated in the first half. we are also likely to see some in theof u.s. dollars first quarter. but in the second half, the u.s. dollar is likely to moderate. the fed is likely to stop after two rate hikes in 2019 after march and june. even the monetary environment, the liquidity environment could be relatively more stable and relatively more in favor of emerging-market. believe it isy we a tale of two halves. even saying the fed will go twice next year is significantly more hawkish than what some market disciplines are saying. that we could get one or even no move next year. we see acenario, could roaring back when it comes to emerging-market assets? manishi: i would not call it

roaring back by any means. i would say what we just talked about. the fed raising rates twice would lead to some degree of of the u.s. dollar conversation. but the market tends to look ahead. but the dollar could peak in the first quarter. we will continue to see a synchronized slowdown in global economics. part of that could percolate down to asia as well. there is a pretty significant slowdown in the domestic economy of china. all of these things will have to be taken into account by the financial markets in asia. there are silver linings as well. moderation in the u.s. dollar has historically been factored behind close returning emerging markets. in asia in particular.

i would point out this decline in commodity prices, particularly oil, that can actually stand many markets in good stead. a majority our community importance and we have seen historically that the margins, growthss margins -- the margins is related to prices. so we might seen some stabilization and markets as well. haidi: with oil prices going down and an importer like india, we have a new r.b.i. chief. big of a risk is it that he will be a drag on financial markets on indian assets because of concerns over central bank independence? manishi: it is possibly to early to say. governor, the indian administrative service veteran -- to that extent, when advantage he could have is to iron out the differences between

the government and central-bank. all over the world, we see these differences. but when they come out in the public, it has a sentiment dampening effect which we have seen in india. if that gets out, it could be a thing of the past. ofcould lead to some degree the relative lack of volatility in the market. i think the jury is still out there. as far as the kind of policies that we will be following. wedi: we have seen -- shery: have seen valuations of the u.s. market, they are back to the 2016 levels. our u.s. stocks going to compete with emerging-market stocks for attention from investors next year? last 20 years,e there have been only two instances of decoupling.

markets have moved in divergent directions compared to the u.s. market. if there is a sharp correction in u.s. equities, it is quite likely it will have a similar impact on asian equities as well. having said this, i would think that even if the u.s. market corrects, there are a couple of reasons why asian margins -- markets may not correct to that extent. asian markets are a lot cheaper. growth in relation to expected earnings and in relation to their return on equity that we are forecasting right now. second, as i pointed out, there is a possibility of the fund flows. managerg back in some -- measure. shery: thank you, head of asia-pacific research from hong kong. a plenty more from daybreak asia. this is bloomberg. ♪

>> a quick check of the business headlines, and ever made in the allocation of shares sold to investors. holdings had a lottery on monday to distribute shares to customers that have now been told they will receive fewer than requested. sbi says they can have more stock but deny the availability of more shares to massive cancellation and orders. hong kong successfully blocking iphone imports to the u.s., but regulators trying to forge a compromise to protect american dominance of next generation mobile technology. the international trade commission says an import ban would hurt america's competitive edge. and it will look at the finding that apple infringed on one of three qualcomm patents. plans for global tech

domination, we will hear from the ceo of an electric vehicle startup on the trade war and the crowded chinese ev field. this is bloomberg. ♪

is 8:30 a.m. in hong kong. we are an hour away from treating there, a bleak day. asian markets looking to tentatively build on the gains from good news hot -- headlines around the trade story, china resuming purchases of u.s. soybeans for the first time since the middle of this year with the retaliatory tariffs on u.s. shipments, hearing about 1.5 million tons ordered this week. we are also hearing potentially china will push back on the tech ambitions in the china 2025 program that could help

alleviate trade tensions. aross the pond we are getting sigh of relief as the u.k. prime minister theresa may survives the vote of no-confidence within her party. she is going back to the e.u. counsel to see if any improvements or sweet can be made to this deal. shery: the consensus is it will be hard to get more concessions from the e.u., not surprising given the headlines on whether it is brexit or trade we are seeing s&p futures turning higher. let's get to first word news with jenna dagenhart. reporter: theresa may remains u.k. prime minister after surviving a confidence vote among conservatives. can't bey 200-117 and challenged for another year. e.u. leaders say they will not reopen negotiations, and the vote still leaves prime minister

may with the task of forcing this through parliament. report grateful for that , a significant number of colleagues did cast votes against me and i have listened to what they have said. following the ballot we need to get on with the job of delivering brexit to the british people and building a better future for this country. reporter: china has responded to calls to do more to aid -- he's trade tensions like buying more soybeans. up to 2 million tons in the last 24 hours, reporting to the u.s. -- according to the u.s. soybean council. shipments are expected during the first quarter and most of the supplies will be sent from terminals in the pacific northwest. china's plan to dominate high-end tech could be a victim of the trade war. they may postpone some of the for an china 2025 program

decade but a final decision hasn't been made. the plan aims for global advances in robotics, renewable energy and has been one of president trump's main targets. it is not clear how much of the been has been done -- communicated to washington. the reserve bank governor of india defendant the economy, worried the government wants more control. in asthe third leader many years and said he would bank's integrity. he was a big part of the cash ban two years ago. mp's and a meeting with the ceo's of public sector banks tomorrow in the morning, and banking is an important segment currentlynomic and

facing several challenges which are of critical importance, and there needs to be dealt with. oil ministeranian has joined twitter, saying he wants better communication at home and abroad. platform is increasingly being used by authorities like the prime minister and others. joiningster said he was for a more dynamic and effective relationship with domestic and foreign audience. 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 am jenna dagenhart. this is bloomberg. haidi: thank you. let's look at the asian markets with sophie. sophie: we are seeing a column of green for asian stocks. u.s. futures adding .2%, bonds coming under pressure, benchmark

treasury's holding steady, not much reaction to the 10 year bond option, and neither trade for currency markets, korean won the outlier, adding 1%. the offshore yuan is whole very -- u.s. trade tensions cool and the kiwi dollar under pressure, slipping .1% after the government cut the gdp and budget forecast but this is modest at best as it is in a tight range over the past two weeks. it has been fluctuating around the 69 handle and as the governor said earlier, the kiwi has been well behaved and it can be explained by economic fundamentals. stocks are behaving badly in sydney. tpg plunging 19% as investors find concerns around a proposed merger with vodafone. investors are coming around to this companyr -- dropping -- jumping the most

since 2016. in light ofemain the increased debt burden. i want to highlight shelter e.on giving up most of wednesday's gain. this came under pressure that korean regulators launched an audit into alleged accounting fraud in health care. shery: thank you. the chinese market for electric and autonomous vehicles could be worth hundreds of billions of dollars, and there is fierce competition about the new arrival of tesla's factory. tom mackenzie joins us from gong show, the center of tech ambitions -- guangzhou, the center of their tech ambitions. how do they see tariff cuts impacting their company? this was an exclusive interview with the ceo of ex-con by alibaba,ed

foxconn and xiaomi, bring about $4 billion and less likely delivered some of their first vehicles to customers. the trade concerns are front and center for companies like this. we asked about the tariffs plans to reduce tariffs on u.s. autos entering the market from 40% to 15%. he effectively said bring it on. we have always hoped the chinese government would lift restrictions around licenses, subsidies and tariffs. the production could benefit us in the short term but in long-term it would damage us. so these car companies are focused as well but the trade tensions are focused on tesla, their entry into the chinese market. tesla already sells vehicles but they have to be exported from the u.s.

they will build out a production facility. this company thinks they can compete with tesla because of pricing and technology in the car. these cars are going for around $30,000 u.s., the cost of a model three tesla. in terms of trade tensions we talked about that. hey are centered in the u.s. they are monitoring the tensions but effectively they have seen no real impact on their business so far. a lot of the technology is built in-house. it is pretty insulated from trade tensions and focused on driving out and carving out market share in china. haidi: there are hundreds of ev startups in china. we had the solar panel frenzy as well. do we expect them to survive? power -- solar

panel frenzy, you see victims of that laying across chinese cities. there are hundreds if not thousands of startups as you say . according to some estimates, 1% will survive, so there is expected to be consolidation. i spoke to the ceo, and he said it is inevitable. he thinks they will come out stronger. listen. >> i think we expect to see a process for consolidation in two years or more. i also think this would lead to bigger companies. so this company has plans to start producing between 40,000 and 50,000 units by the end of 2019. they will build their own factory, there on production. they want to reach a volume of 100,000. they get breakeven and reduce cash burn. they are looking at a third round of funding. they haven't ruled out an ipo on

the horizon as yet, but they do have -- they don't have a timetable for that. it is challenging because of the slowdown in the economy, and investors have to become more rational, take a rational stance where they put their money, but this company is confident they have the finances to keep going. it is increasingly competitive. you have this one listed on the new york stock exchange, others founded by former bmw executives, then the incumbent players in china and the foreign automakers like bw and forward looking to rule out -- roll out their vehicles. competition is expensive -- intense. the platforms to be able to compete effectively in this market. certainly confidence and ambition. tom mackenzie from gong show. -- gong show --

a senior advisor now from crumpton group. he joins us from washington. not a bad day when it comes to talking about positive vibes in trade negotiations. we have the resumption of music and soybean purchases -- significant soybean purchases. we are also looking at this report from bloomberg news suggesting china could be as a concession i guess willing to push back ambitions in the 2025, in chinahina to -- 2025. is that a pillow of strategic -- pillar of the statistic dominance xi jinping wants china to have in the global landscape? correct.ormulation is we will see a rebranding of made in china 2025 to something less ferocious sounding to the u.s. government. we are looking for china to move away from industrial planning,

move away from subsidizing domestic industries and move away from technological dominance. anyone who believes i have bridges can sell them. it is important to understand what china is trying to do is walk this back from the precipice, and made in china 2025 has been for the last 24 months a significant your tent in the bilateral relationship. -- irritant in the bilateral relationship. it was called out in a report. we should always turn up our nose at possible signs of optimism and should give china a chance to see the restructuring being significant, i think we need to make sure we are looking for clear signs of how we can verify china is going to be looking away from subsidizing and protecting domestic industries at the expense of foreign competitors. haidi: the other unknown is if

it will be enough for president trump. you mentioned clearly there is an agreement between the u.s. and its allies, that there is a need or desire to contain strategic ambitions of beijing. the question is what the strategy is. do think there is a possible coherent way to do that without rupturing global trade and investment? millionis the $1 question in d.c. because it is difficult to understand what coherent strategy is from the trump administration. you see a multipronged attack here that runs from investment restrictions like pharma, export controls, likely to see the unveiling of indictments against chinese individuals for cyber espionage. you have the arrest of the huawei executive in canada for possible extradition.

at the same time you have this 90 day window on the trade front. pick your flavor. if you are looking for a narrative the u.s. is trying to contain china, it is there. if you see trump playing five d chess and is trying to wrap up pressure, that narrative is there as well. this is what keeps people like me employed. policymakerse seen at the center of trade tensions, really managed the situation. since the arrest of the huawei cfo, we have seen outrage spread to the chinese public as well. i wonder how much public pressure will play into the calculations, aware of the trade tensions. nationalism in china is a factor. china has politics too even though it is under the communist party. it is important we have a granular look at how nationalism works. oftentimes the government will

play up the nationalism it is feeling for the public as a way of saying we are out of options, listen to the people. other times you see when events happen, you would expect a significant outpouring of nationalism, you see the government has a swift ability to camp down on it. you look at certain more vocal wings on the internet, there is outrage at what has happened with huawei. it is interesting you are seeing folks fed up with how xi jinping has been driving the country, using this moment of bilateral tension to come out and say you tried that tactic. it hasn't worked. look at the economic headwinds and global push back. it is time to go to more reform and opening, and this being the 40th anniversary of the reform, it is good historical cover if xi jinping is looking for a way to feel that pressure, announced a set of reforms that don't make it look like he is doing this at

the urging or demand of the united states. he can smuggle it under historical narrative. shery: we are seeing some of those consumption -- those concessions like with soybean consumption. tariffs onncreased products but also plans to cut the tariffs on u.s. cars. are those sincere efforts to find a solution, or are they for show? from 40 to 15 cut is a verifiable measure. oddink in an audit way -- way, this is a golden issue to look for market openings because the chinese government is off-balance. its economy is not doing well. its appetite for opening certain sectors for liberalization is more than the past 24 months. the concern is if they figure

out or make the assessment the trump administration is not looking for a deal but this containment narrative israel, that some of the investment restrictions, export controls, the other tools the u.s. is using are part of a containment, this window clamps shut. for the time being, anyone who has an issue, it is time to go with it and bring it to the chinese government because they are looking for wins here. shery: thank you for joining us. private equity firm kkr taking a stake in singapore energy savings. this is bloomberg. ♪

haidi: this is daybreak asia. shery: private equity firms have been pushing into impact

investing to seek financial deterrence and social benefit. kkr is the latest new one building -- with a stake of $33 million. a singapore provider of energy saving solutions. let's bring in napoleon great great to have you in the show. tell us what your company does, who your major clients are, what do you do? >> what we do is basically digitizing air-conditioning systems. the reason this matters is air-conditioning systems are a major use of energy. in commercial it is half of their usage. in industrial, it is a lot as well. we have a software and hardware package we install on any existing systems, allowing them to reduce energy consumption up to 40%. the reason it matters is for it -- forward thinking allows able

to reduce operational cost and environmental impact. to give you some examples, for commercial real estate we can reduce energy consumption between $100,000 and $300,000. from a factory it can be 300,000 to $3 million in energy reduction. it is linked to reduced environmental impact. are hotelers segments. we have customers in office and shopping malls. we have customers in the industrial sector and again semi-conductor industry is one of the largest, growing very fast. sizablehis is a investment, and where you plan to use the funds? >> we are already in eight markets. we will enter new markets and we will keep investing in new technology as we have done. we were early investment in , advanced analytics three

we want to keep investing in these. we want to increase our headcount inside and outside singapore. where do you see a i guess investment or expansion opportunities beyond singapore? >> definitely we have already customers in indonesia, thailand, taiwan, china. where we are looking at is entering the large industrial companies -- countries like south korea and japan in order to keep increasing our impact across sectors. this is a milestone investment. in terms of the cost savings you have been delivering, is that something that is sustainable? >> definitely. customers come to us because our solution allows them to save

energy today with advanced analytics on the backend, we can help them save your after year. that is one of the main reasons forward taking customers work with us. shery: this is a first impact investment, so how did the deal come about? sustainableeen in solutions for a long time. they wanted to get their heads around this solution in singapore and this region where they reached out to us and started a conversation about the state of sustainable technology firms in this article world. you poor has been at the forefront of sustainability for decades. the government here has been pushing energy efficiency for a long time. they wanted to start a conversation. one thing led to another, and they felt this was a company we are clearly growing fast,

delivering a lot of value to our customers. our customers do not pay anything upfront for our solutions. we take a portion of the savings, help adaptation. with all of that in mind, and again they have a large footprint of companies here which could be our customers. it was a good match. having someone like kkr helps us grow to a pan asian company. bbp.: the ceo of thank you. this is daybreak asia. ♪

haidi: this is daybreak asia. i am haidi stroud-watts. shery: i am shery ahn. let's see what we should be watching out for in the markets in asia. sophie is in hong kong. sophie: we are watching agricultural markets with soybean futures in chicago starting to trade that :00 a.m. hong kong time -- 9:00 a.m. hong kong time. china order to million tons from the u.s. -- ordered 2 million tons from the u.s.. the big deals are in fact happening as trump said earlier --s week china but is buying china is buying tremendous amounts. but there could be more casualties as apple suppliers are considering shipping

production out of china if the u.s. increases tariffs to 29%. one apple partner suggested other locations for iphone production, so watching some like these. the wrapping up of the patent spat between qualcomm and apple will drive markets. haidi: let's take a look at how markets that are trading are are faring. we are seeing a tentatively positive mood in asia with positive headlines on those soybean purchases. also potentially a did taunt -- detente on the trade war. shery: futures looking higher. this is bloomberg. ♪ is is bloomberg. ♪

rishaad: this is "bloomberg markets: china open." >> theresa may clings on after winning a conservative vote on confidence, but her brexit they'll headache will not go away. >> the u.s. demands more to be done to ease tensions. soybean purchases are already rising. >> inflation and the banks. laying out his priorities as he takes control of the rbi.