>> a very good morning. us trillion markets have just opened for trade. >> good evening from bloomberg's global headquarters in new york. asia." me to "daybreak >> our top stories this friday -- optimism rises of a trade talks in washington. china is offering to buy more u.s. food as the site edge towards a deal. says theovernor economy may be softer than thought and ford is the latest

automaker to find testing problems but says it is not related to speed devices. >> let's get a check of the market close on thursdays session. with the dow falling .4% and the s&p 500 also down by as much after gaining for three consecutive sessions, but this coming on the back of a significant rally this year. this is only the fourth time this month the s&p 500 has declined. we saw energy and health care stocks leading the declines in to today's session. the nasdaq also fell, but again, after the longest winning streak since august of last year. eight sessions of gains. s&p futures unchanged at the moment. sentimenthow risk looks in asia. >> we are seeing a cautious start to session. qe stocks have sloan. -- slowed.

we do have some stocks on the move. let's pull up the board for automotive holdings, which sell as much as -- fell as much as 8.8% at the start of trade on the back of results. the company has scrapped rest have to dividends -- first half dividends amid a decline in the auto market. >> just getting more earnings crossing the bloomberg. we are seeing pretty much a miss on many metrics for fourth-quarter net income coming at 926 million, missing estimates of 1.1 2 billion according to bloomberg estimates. seeing that interest income also at 1.50 2 billion saying as well 1.5 20 2 billion --

billion seng as well. full year income being reported at 4.40 9 billion singapore dollars. comes on the back of the third-largest southeast asia and later in the last half an hour also reporting numbers that missed broad estimates. >> the last latest r.b.i. minutes show flagging concerns about growth and keeping the door open for more rate cuts. his deputy bureau also leading toward future cuts. rank indonesia left rates on hold, as expected, and dropped more hawkish recent comments. repeat past did not comments about preemptive moves but said policy is based on external stability. of china is bank

signaling it will use further focused stimulus to guide liquidity to particular parts of the slowing economy. the bank will enhance the combination of policy tools such as targeted reserve ratio cuts and medium-term lending facilities according to its quarterly policy reports. rrr cuts have become a favorite move to avoid flooding the system with extra cash. the european union is expecting theresa may to request a three-month delayed brexit. two eu officials suggest she could offer an extension of the house of commons backs her deal, but it is not signed off until a summit in late march. she has repeatedly rejected the idea of an extension, although ruleds never completely one out. for it has alerted federal regulators there could be a problem with its emissions and economy testing after staff reported issues with the way the company tried to make sure cars meet u.s. rules. it has hired an outside firm to look at the matter but says

involveations do not so-called deceit devices that were used by volkswagen to beat diesel emissions tests. news on air and at tictoc on twitter. this is bloomberg. >> thank you. that theng optimism u.s. and china are moving closer to a deal that would avert a new terror -- tariff next week. sources say beijing is offering to buy an additional $30 million a year in u.s. agricultural products. thissort of signal does send about potential progress and a potential deal? these are just agriculture products. they are low hanging fruit, not necessarily structural reform. >> absolutely. that is just one component of any deal and we should be ofeful not to make too much

that offer, although, clearly, it is a stonking number, if you will. $30 billion as compared to the $4 billion china currently buys from the united states or bought in 2018. it's the kind of big number donald trump is likely to like, but we are still unclear what sort of progress is being made on structural reforms. we're hearing they are starting to work off some draft memoranda of understanding. that is important. couple of weeks ago, there was not even any common paper or text they were working off of, so that is positive. we are headed into the evening in washington and we expect them to talk late into the night tonight and to come back tomorrow morning. --are hearing the chinese that taught chinese envoy will be in the oval office tomorrow afternoon or a meeting with donald trump -- the top chinese

envoy. we do not expect everything to wrap up by the end of play friday, but certainly progress is being made. >> what happened to the deadline? >> it is still some ways away, at least a week. we do not know at this point. we have been hearing talk in recent weeks that the white house is willing to extend. president trump has said himself that that was not a magical date. he said that earlier this week. at the same time, we are hearing that the u.s. side is keen to put as much pressure as they can on the chinese to get a quick deal and that they really do not want to extend that deadline very far. hard to say how long these things last, but as you know, in china, they have their own political calendar coming with the national people's congress. it is unclear if negotiations can continue through that. they will start march 5, last through the 19th. it is a tough calendar ahead. still a lot of work to do, but

at this point, everyone is focused on the next 24, 48 hours. >> we know president trump has a couple of days that might keep him pretty busy in hanoi next week. he is expected to meet with the vice from their. is there significance to this high level meeting? >> i think so. the last time he was in the oval office -- it feels like a long time ago, but it was really only two weeks ago -- that was interpreted as a sign of progress, and we should interpret it the same way tomorrow if it does go ahead. it's hard to see the president meeting with him if there was not some kind of progress to tap. i think we are seeing both sides shape up for a deal here, but, you know, still some work to be done. .till some gaps at the end, as donald trump has said himself, it will take a meeting between him and xi theing to nail down some of

final points. we still do not know when that meeting will be. >> we really appreciate your time. a quick note -- we will be bringing you the new china open live monday. we launch our state-of-the-art studio there in the chinese capital. policy lines are live. the odds of a rate cut our trending. government says the bank is not on a predetermined course when it comes to rate trajectory. the man who has called for a cut in august and another in november, and as we continue to hear from phil low, he says you have to remember that we are seeing average, not below average levels of growth, combined with low unemployment pretty much globally.

is the picture still fairly balanced toward that neutral stance? >> the picture is as bill evans described it earlier. we have a situation where growth is slowing. the rba has adjusted its stance, and i will add one more thing -- inflation is basically nowhere in australia, and it is receding throughout the developed world and throughout this region. interestingvery point about the rba commentary on housing. for a long time, there was a lot of narrative about how this was something that probably had to happen and it's probably a good thing. we saw in the rba minutes this distinctbtle but change of tone. the language was until now not really a problem, but if it gets

worse, that could harm consumption in the rba has put a lot of stock in consumption holding up. >> one of the other things he spoke about in his opening statement was saying central banks globally had fewer buffers, less room to maneuver if things go down from here. ? that a real concern particularly when you look at the fed saying the cycle of normalization is over, and lots of talk about what they do it things really deteriorate from here? >> what is seen traditionally against the level benchmark rates traditionally have been at when major market economies interest slowdown is an entirely justifiable concern. been nocases, there has normalization of interest rates. the interest rate is still negative. they have stopped qe, but, you know, it is interesting you mention jim bullard.

jim bullard was one of the intellectual architect of one of programs.qe the ammunition is there. it's just that what was seen as unconventional emergency policies last time have now become mainstream. they have now become legitimate. >> of course, we have the fomc minutes as well this week. there seemed to be more consensus on ending the runoff of the balance sheet this year, but at the same time, they did not totally rule out potential rate hikes. >> know, they did not totally rule it out. the thing to remember about the minutes is it is a summary of the discussion, not necessarily the determining statement which we saw at the end of january. just one anecdote -- it does also underscore how influential points much at turning

of the cycle we need to listen flagged who have balance sheet normalization. there is a core group of fed officials that really matter, particularly at turning points. the minutes attempt to represent the views of the group. i would go for what the key players themselves say and what the fomc statement said. obscure how decisions are actually made. >> thank you so much for joining us. bloomberg opinion columnist dan moss. still ahead, and update forecast from chinese search engine by do. we will look at the forecast later this hour. coming up next, markets have unrealistic expectations when it comes to the outcomes of trade talks. our next guest certainly thinks so. this is bloomberg. ♪

>> we are counting down to asia's first major market open this morning. we are seeing downside pressure for nikkei futures, which are down .5%. we are seeing the japanese yen holding ground at about 110. we're getting cpi numbers out of japan in less than half an hour, cystic around for that. this is "daybreak asia." >> let's get to sophie in hong kong for a look at early movers in the session this friday. >> we are seeing coal miners china downplays a huawei tensions. when it comes to reaction to the saying aon, some customs ban or china-wide and will not be sustainable beyond a few weeks or months.

or corp. fluctuate in this morning, earlier gaining more than 6%. that is that the rating. the stock now up nearly 2%. pharma, this is the company posted a 67% rise, first half growth profit with stronger margins, but the stock under pressure this morning. it says it is continuing to look at acquisitions that complement its existing business, and it says it has 14 products pending approval with the fda, including eight with no generic equivalent. you so much for that. the latest line from the governor from rba saying he is surprised at the reaction in the aussie dollar following the report that china was banning australia's cold -- coal imports. it also said the deterioration in china ties would be very bad

or australia. we will get you more as we get those latest lines from the rba governor. we are seeing a tumble in trading after missing estimates and alluding investors to an sec inquiry. we saw the s&p 500 dropped for the first time in four sessions. su keenan joins us now with more. we've been talking about these challenges for the rally to continue. >> a lot of headwinds here. let's go right to the snapshot. if you look at futures, they have been down about .5% going into the friday session. snapshot of the market if we have it. there you go. let's look quickly at some of the big movers in the regular session. nike was in the spotlight earlier. fascinating story. a shoe blew out on a player,

raising a lot of concerns about product. very quickly, let's go to some of the after hours. is emerging as the big story. of course, baidu did well, and that has been up. hewlett-packard raised its full-year profit. ford announcing emissions t definitelyt kraf going to weigh on the market. >> su keenan with a look at what we're watching going into our friday session. jpmorgan asset management's gary craig joins us from melbourne. is it i guess a moderately positive short-term resolution to trade talks essentially priced in the moment?

the case.much is big fears permeating markets at the end of 2018 starting to fade away a little bit. it is the idea that you will have some sort of agreement between the u.s. and china. at least no new tariffs being implemented. havearnings that came out been expected are at least not as bad, so markets have come off a very weak position on the back of that, but it has driven -- it has been driven largely by multiple expansions and we have seen earnings downgrades come in through the full year of 2019. for us, some of those risks have been alleviated, but we do question the durability of this rally. >> of course, we have seen when it comes to the central bank story lots of action here in australia. if you look at money market measures, they are expecting at least one full cut over the next 12 months. the rba isk that

going to be able to stomach waiting for unemployment to climb up for they shift to a dovish stance -- before they shift to a dovish stance? >> markets have seen rates move, and they feel if they are not hiking, they must be cutting. for us, and think the threshold for the rba to move downward from here is pretty low. the labor market report this week was still relatively quite strong. there's still a lot of offshore pressures that could change the outlook. we do see some of those risks start to evaporate, and i do think they will be in a wait-and-see mode for a little while yet. looking ahead, i think they will focus not necessarily on the unemployed want -- the unemployment rate itself, but they will keep to business surveys and those employment tensions, and the deterioration in those suggests will start moving upwards on an unemployment rate and the fact

that we have no longer inflation would suggest you could see that rate cut come through, but not any time soon and our mind, and i think they will be cautious to maintain the view that it is a neutral rate, that they are not moving up or down and we will have to see how things eventuate. they will have to think about the effectiveness of a rate cut, should it materialize, and what it will mean for the economy. those rate specific sectors are not as sensitive as they have been in the past. they really need to drive real rates negative to see an impact in my view. >> we are also hearing the governor expressed surprise at the aussie dollar reaction to the report china might be banning australia's core imports, but how big is a downside risk for the aussie dollar when we are not only see a u.s.-china trade tensions, geopolitical tensions, but also prices? nd inr

>> our view was the aussie dollar should we can to reflect the growth differentials coming through around the world and this was just another complicated -- complicating factor. you look at resolution on trade and china in the u.s. would have been positive or the growth outlook and the implications of maybe banning on coal imports would be negative, but they are quite small in terms of magnitude on experts in the size of the economy in terms of the effect that way, so it was a knee-jerk reaction in terms of markets. nothing to suggest just yet that this would be a prolonged ban or china doing anything more than flexing some muscle and reflecting the attitude toward the australian government at the moment. >> we are seeing the fed being more dovish but really not easing. how much more can u.s. markets rise this year?

of thek the case near-term strength of the u.s. equity markets could be maintained, especially as a lot of these factors around trade have then priced in, but you need to see something really to move andrnings triggered higher in our view. somethingneed to see change for it to rise materially from here given how hard it has rallied, and a think the fed has been portraying it's a neutral stance on where it is going with rates. the growth outlook is one that is slowing. we may get another rate hike from the fed this year. we also might get that clarity on the balance sheet come through in march, so it is the that the fed is due to stop adjusting the balance sheet at the end of this year. maybe they move once again on rate hikes to that end. >> great to have you with us.

market strategist at jpmorgan asset management and melbourne. plenty more to come on "daybreak asia." this is bloomberg. ♪

>> a quick check of the latest business flash headlines. pinterest is reported to a filed with the sec for an initial public offering. "the wall street journal" cites unidentified sources for the andy and says goldman sachs jpmorgan are looking at a listing late in june. pinterest is said to be seeking to raise about one point $5 billion and wants a valuation of at least $12 billion in any offering. tesla took a hit again as the "consumer reports does quote magazine dropped the model three from its top 10 annual ranking, saying honors have complained about issues such as loosefitting parts and defective glass. subaru talked the same ranking for the fourth time and has

racked up more than seven years of consecutive monthly sales growth in the u.s. coming up, we will get a health check on the japanese economy, in particular, the inflation picture. the latest cpi report is up next. this is bloomberg. ♪ this isn't just any moving day.

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simple. easy. awesome. stay connected while you move with the best wifi experience and two-hour appointment windows. click, call or visit a store today. >> we are getting the latest national inflation rate for japan. nowhere in the target. -- nowhere near the target but bang on expectations. picking up slightly from the .3% pace we saw in december. we are also seeing the headline number at .2%. not much in a way of surprise, as markets were expecting, the bank lowering its inflation target for the fourth consecutive time in january and 2% quarterly report, that

inflation target. you can blame oil prices, you can blame the energy sector, but at the end of the day, they will be sticking to that policy for a long time. >> not very often that you hit every estimate bang in line. all three numbers bang in line with estimates. the japanese yen not doing that much right now. let's get you the first word headlines with ed ludlow. >> optimistic noises from the trade talks in washington suggest the u.s. and china are moving closer to a deal that would avert new tariffs next week. sources say beijing is offering an additional -- offering to buy an additional $30 billion of year of american agricultural products. the new purchases would be on top of levels from before the recent trade war. the aussie dollar fell the most in two weeks on a reuters report that china was banning

australian coal shipments. australia's treasurer denies the wayst and says ties two remain exceptionally strong and also dismissed the idea than any retribution for australia blocking huawei way from using its 5g infrastructure. we've been told a wider public rollout of an apple-goldman sachs card could be later this year. the state of michael jackson is suing for posthumous character assassination in the "leaving .everland" documentary the documentary details claims by two men who say they were

sexually abused by jackson when they were children. global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists, analysts, and more than 120 countries. >> thank you. let's look at australian markets this selection. >> the aussie dollar is gaining ground. the central bank is not on a predetermined course when it comes to interest rates. let's check in on some coal stocks in sydney. we are seeing some reaction when it comes to analysts.

let's check in on some other movers. we are keeping an eye on automotive holdings. web jet building on yesterday's 30%-plus jump on strong results and info care gaining ground, despite raising its target, as 2018 operating eps fell nearly 22% and it did cut its dividend, but the company remains confident it can deliver eps growth over the medium to longer term. switching to check in on myob, the company board has takeover offer's with no superior rival proposals emerging.

we do have one massive mover to the downside in the u.s. after our session. stamps.com, the online provider of postage and shipping services falling 50% after it put an end to its u.s. postal service shipping partnership. it did plunge post market after revenue guidance missed estimates pretty much on every .etric >> let's turn now to u.s.-china relations. there's rising optimism over trade talks taking place in washington this week. negotiators are working on multiple memoranda of understanding covering areas such as agriculture, technology transfer, and intellectual property, which would form the basis of a final deal. the u.s. china business council's watching closely and has already weighed in on the prospect of mo you's. the council president joins us from washington.

-- already weighed in on the prospect of them oh you -- prospective mou's. >> president trump will be the best premiere tomorrow afternoon, and i think at that time, they will try and wrap up the negotiations. what we are hearing is that substantial progress has been made on purchases and some of the other market access issues, and more limited progress has been made on some of the structural issues. >> you represent over 200 u.s. businesses working in china. to positive is it if we get see a symbolic agreement but no real progress on intellectual property issues or technology transfer issues, more of the structural reforms that the chinese economy needs? >> i think where you stand

depends on where you sit. for many companies, particularly those who are consumer-facing, they will be happy to see the end of any tariffs. however, companies in the more regulated spaces and companies that require approvals from the chinese side may be less happy unless the structural issues are addressed. we think that president trump has created a significant amount of leverage, and now would be a very good time to address those structural issues in a systematic manner. there will be a better time than , so we are hopeful for progress in those structural issues. >> what about the issue of enforcement? i think that is something that has been missing from the drips and drabs of this information.

is there some doubt as to if can bevertures enforceable? >> enforcement is an important part of any trade agreement. under the wto, this is pretty much codified. it is a very difficult question that negotiators are wrestling with. i regret to say that there is a lack of trust at this time between the two countries, and that makes this job all the more difficult. there is certainly a breakdown in trust on both sides. you can sort of make progress when it comes to as we have been talking about, the lower hanging fruit to try to address the deficit, but when it comes to the trickier issues, do you see

improvements being made there, or will this be a longer-term issue? >> let us hope that there is indeed progress on structural issues, and they would include state-owned enterprises, subsidies, forced technology transfer, cybersecurity, and intellectual property rights. however, i think we would be naive to think that all of these issues will be resolved over the shorter term. indeed, the technology issues are deeply embedded as problems within the relationship, and it's going to require a lot of work, certainly. it will not be completed definitely before march 1. we are hopeful limitary the luminary or initial agreement can be reached by march 1, by which the administration will lift tariffs and the chinese will reciprocate.

it will be foolish or naive to think all these issues will be resolved by that time. >> they say they are making progress when it comes to ip in china.hinese -- >> i think it would be universally knowledge that china's intellectual property rights regime has improved greatly over the last year or over the last five or six years. however, there's a lot more work think even and i chinese enterprises, particularly private sector chinese enterprises, would agree --t strengthening of our pr strengthening of ipr is absolutely necessary for the chinese to move to the next level of economic development. while this is positive is a bilateral issue, it is indeed not only a bilateral issue, it

is a multilateral issue as well as a domestic issue in china. therefore, i think we can be confident that there will be some at least marginal improvement as a result of these talks. hopefully, we will see more than just marginal -- hopefully, we will see structural improvement to put foreign companies on a level playing field with their enterprisete-owned competitors. >> have you seen any change in the ease or difficulty doing business on the ground? >> i think the chinese central level government has been very disciplined at not allowing retaliation against foreign invested enterprises. that said, there has been a change in sentiment in china and

consumers are holding back, keeping their wallets shut, and i think many particularly consumer facing enterprises are concerned about rising nationalism and any overtone of bilateral tension, so we are hopeful to put this era behind us. we are hopeful to move on with a more balanced trade relationship in the near future. onreally great to have you with us. we appreciate your time. , ford shares have been slipping in extended trading after it raised a mission problems with regulators. we will have the details next. this is bloomberg. >> bloomberg television has a new home in china. , i joinedebruary 25 bloomberg markets china open

live in beijing. the world is watching bloomberg television. ♪

>> we are counting down to asia's first major market open. japanese futures looking pretty lackluster. japanese inflation in a fairly data-light day, coming in pretty much as expected for the month of january. heinzres of kraft plunging after hours in the u.s., down more than 18% -- 19% at the moment. the food and beverage conglomerate. abouts this telling us the state of their business? >> it's not good. i think there's a lot of bad

news in this report. that's a very big number to be writing down the value of the kraft brand. they also missed on eps, which one thing these guys do is kick profits strong. they cut costs. sales growth has been elusive for them, but to miss on profit -- they said costs were higher than expected. there is also an sec subpoena. this is a very bad news report for kraft heinz. investors doubting management's ability to stage any kind of turnaround. >> like i said, it's rare you see a report with this kind of triple whammy, so to speak. there have been questions about kraft. even before today, shares were down 50% since the unilever deal fell apart. investors expected these guys to do a major acquisition.

what they do best is cut cost. ever since unilever fell apart, something like $70 billion in is owned by -- this warren buffett, and it will get hammered tomorrow and the u.s. and open at the lowest price it has ever been. >> thank you so much for that. ford shares also slipping in the iter-hours session after alerted federal regulators about a potential problem with its emissions and fuel economy testing. very quick to distinguish this from volkswagen's type of the missions issues. >> definitely getting away from that in the statement that was released earlier today, saying it was not related or similar to the emissions cheating scandal plaguing volkswagen, but employees were the ones who actually made this known back in september that led to the

disclosure on february 18 two the u.s. epa, the environmental protection agency, which led to the statement earlier today. let's bring up that statement from ford with regards to what has been happening. in september, a concern through our speak up -- basically an employee whistleblower program, reporting channel, regarding the analytical model that was part andhe fuel economy emissions compliance process. on page two, they continue to say that they believe trust in the brand is earned by acting with integrity and transparency. what are those action steps you can that includes hiring an outside firm to conduct investigations. this is with regard to something there calling road load for fuel economy. also evaluating changes to that ford'sg process, but north american division has

consistently led its five regions for the number of wholesale vehicles sold. "consumer reports" pulling their recommendation for the model three. what happened? >> "consumer reports" taking them down 11 notches. they are number 19 right now, and this is not great. we are seeing the knock on effects in terms of share price. 4%,ink it is down nearly 3.7 percent, and it's all about reliability. what are we talking about in terms of issues? cracks in the rearview window, for one. very easy to crack, apparently. electronics -- the touch screen freezing up. there's also paint issues. this also loose exterior. the trim apparently is easy to come off, so all of these are causing problems with

reliability. this is the test from owners -- this is the text from owners saying all this. "all three tesla models have below average reliability. we do not recommend any." tesla goes on to say that they take feedback from customers very seriously. s for tesladwind there. you can get a roundup of stories you need to get your day going in today's edition of daybreak. you can customize your settings so you only get news on the assets and industries you care about. this is bloomberg. ♪

>> chinese search engine is projecting revenue will rise 12% to 18% in march as new content and products help energize our .usiness our chief north asia on theondent has been story. what sticks out to you? >> we are expecting a weaker report in the fourth quarter because of the slowing chinese economy's impact on advertising spending. advertising is still down and they are still getting fromtising dollars upstarts in the numbers really on the expectations revenue front as well as the income. operating profit was down euro per year. we were expecting that because of the high content costs, that they have been spending a lot of money on content for their video website, which is like netflix,

ite. operating profit missed estimates, but adjusted profit beat. we're expecting one dollar $.74. also fourth-quarter revenue beat even the highest estimates rom analysts. we were expecting $3.89 billion. the firstst for quarter, current first-quarter revenue was pretty good. a rise of 12% to 18%. robin lee, the chairman, had warned in the last few weeks that 2019 was going to be chilly for a lot of chinese companies, including himself. among the back triumvirate, if you want to call them that, baidu, alibaba, tencent, baidu has fared the worst, their stock down 10% over the last year, do largely to their exposure to the

advertising market more so than the other two. the other two have had problems as well. >> of course, especially with tencent with the freeze on gaming approvals in china. how does baidu plan to offset the weakness in advertising? >> what they are trying to do is build content it builds an whatstem similar to tencent has done with we chat, the ubiquitous app that can do everything. they want to do a similar thing where they can funnel everything and also have advertising play out, and that is why they are spending money on ai. they have an alexa-like service they are building out. aere's going to be longer-term spending spree, if you will, but the ultimate goal is to [inaudible]

check of thea latest business flash headlines. has comery company from almost nowhere to become the most valuable company in new zealand. milk is four years, a2 worth 7.5 billion u.s. dollars. it says it expects to take a bigger share from global players. hedge fund third point reported a double-digit decline for the second time. says it reduced its net equity exposure in december and believes moderate position is appropriate given the current environment. japanese and south korean markets open at the top of the hour. let's preview what is what. >> we are looking at a busy

friday across the region, of course, waiting on u.s.-china trade talks. the outcomes from those negotiations, and we do have stocks to watch in japan. we are keeping a close eye on nissan after s&p cut its credit rating for the first time in a decade. panasonic on the radar after the modeles fell with three losing its recommendation from consumer reports and we are keeping an eye on do sun, heavy as well as it has raised 850 $2 million by selling shares and assets. we take a look at the set up for markets in japan and korea. cautious sentiment this morning. >> caution does it. we are waiting for a solid report out of trade talks in washington.

we know president trump is planning to meet with the chinese vice premier on friday. also report china is planning to increase its agriculture and energy purchases from the u.s. ♪

haidi: i'm haidi stroud-watts in sydney. shery: good evening from bloomberg's global headquarters in new york, i'm shery ahn. kamaruddin,sophie welcome to "daybreak: asia." haidi: our top stories this friday, optimism. japan buying more u.s. crude. there is nont says debt pass on trade.

shery: baidu jumped, expected to top expectations. revenue was a fraction before $4 billion. haidi: some headwinds coming from the decline on wall street. let's get straight to the market action with sophie kamaruddin. in the aussieoves and kiwi dollar, recovering from overnight losses. on the yen going up a touch. we had data up about half hour ago showing inflation inching higher. oul stocks are opening in lisase and tokyo. we do have it under. nikkei looking at a four-day advance. some stocks on the move at the start. nissan is heavy, a 9.9%. the court and

engineering under pressure. analysts cutting price targets produced by as much as 20% after shares iny issued new order to raise funds to offer financial support for its engineering. haidi: let's get the first word news with ed ludlow. ed: australia's central bank says the rba is not in a course on in cut rates. there may be a need for a rate cut if there is a rise in unemployment and lack of progress towards the inflation target. at the moment, it is still not on the table. up,oday, the probability is the probability that is down, they are evenly balanced. ed: the aussie dollar fell the most in two weeks. china has banned australian coal

shipments. tw remain highly strong. o he dismissed the idea that any possible ban could be retribution for australia's blocking chinese mobile provider hauwei. the european union is expecting theresa may to request a three-month delay for brexit. the latest discussions suggest to offer in negotiating period. it is an signed off until late march. may has rejected the idea of an extension. she never completely ruled it out. ford has alerted federal regulators that there could be a problem with transmissions in economy testing. the way the company tried to make sure cars meet the u.s. it's hard to look at them at -- a firm look at the matter and said it did not involve --

global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ed ludlow, this is bloomberg. haidi: just one line coming from rba government. a testimony in sydney. the economic committee. he thinks it's unlikely that rates will rise this year. this after being questioned about the controversial call that they will have the rate cuts in november and december. they said it's unlikely at this point that the rates will rise. the money markets are pricing in one of four cuts by the end of the next 12 months. as the that testimony news goes on. china proposing to ramp up urges his of u.s. agricultural products. the news comes as they are prepared to wrap up the latest

rounds of talks taking place in washington. tom mackenzie joins us from beijing. again with the agricultural products. this is clearly intended to spring the trade deficit. tom: absolutely. the chinese proposal is to buy an additional $30 billion worth of u.s. agricultural tradets on top of pre war levels. you're talking soybeans, cold, and wheat. they are looking at potentially reducing some duties they have put on distillers grain in light of these trade tensions. we have seen soybean imports from the u.s. to china increase a little bit. it does remind us that one of the key aims of the u.s. negotiators was to reduce its deficit with china, $375 billion. that is at the forefront of the trump administration's aim as

part of the stocks. it's also one area where many china watchers say it's easy for beijing to respond to. now i'm hearing about this $30 billion number. shery: what about the structural reforms that washington wants out of beijing, including those of ip theft, forced technology transfer? the more difficult stuff, in terms of the negotiation. in terms of what the plan is for the end of this week, they want about five mou's signed, or at least agreed to, moving in those areas. it will include areas like intellectual properties, forced tech transfer, services sector, as well as agriculture. in terms of the deep structural reforms around things like subsidies for various industries, that is off of the table for now. we know that the vice premier is likely to meet with president

trump, suggesting we are moving in the right direction. we are all listening to see if the administration will extend the tariffs deadline beyond march 3. shery: speaking of one of the issues, it will take a lot. how will have to pay for their campaign. tom: it seems to be trying to fight. this massive chinese telecoms company, which has come under pressure through the department of justice's indictment earlier this year. the pressure campaign we see from the u.s. on its allies to block why way. just pushing back and having a chairman announcing some investments in canada. also saying as part of a press conference that the company would not there -- not ever open backdoors to chinese authorities. that is been a concern from the u.s. and its allies that hauwei

would be providing infrastructure chinese spies could use. they said that was not the case. they would refuse to follow through on them. many china watchers say that is pretty unlikely. tos is an attempt by huawei shift the narrative on this story and portray itself as a a privatelayer, company going about its business. announcing investment in canada. interesting because the cfo is currently being held -- is on bail in canada as part of these investigations in the u.s. shery: our china correspondent, thank you so much. news for our viewers and tom, you don't want to miss the bloomberg markets china open with tom mackenzie live out of beijing monday. will have -- we will have our , and guests-the-art to break it down. all of the headlines. also the impact on the markets and the global economy. you don't want to miss it.

asian stocks looking for losses following a week after investors mulled a certain economic backdrop and signal from the trade negotiations. let's go into the bloomberg and to mark cranfield. a very volatile day ahead for the aussie dollar. testimony.rnor low's he's saying it is unlikely the rates will rise. he has concern about growth. mark: the fact that he was willing to say there is potential for softness in the economy and doesn't see wage inflation coming through, these are quite significant things. they may sound like small, incremental moves, but it looks as though the rba is beginning to question its own forecast for the economy. they were looking for an economy to grow this year in the high 2%, close to be present.

we have already seen some private forecasts that it would come out probably in the low to area. open, its beginning to could be the precursor to slightly moving down its forecast. certainly opening the door to the moving towards a rate cut. it doesn't mean a cut is coming at the next meeting, but it means they are shifting their thinking in that direction. we do start to get some aussie data on the soft side. it certainly builds the case for the rba to make a rate cut sometime later this year. when you think about the u.s. data, which came out overnight, the fed numbers were very soft, it's beginning to look that way that even australia could be affected by this. the rba needs to reconsider where it's going in the next few months. haidi: you are looking at the bond markets moving in anticipation. are we expecting more yield compression going forward?

are bond traders getting ahead of themselves? mark: not necessarily. we have a bloomberg story running today saying that if you year treasurye yield in australia, that quite often will come all the way down to where the current official wage is, 1.5 in the moment. we could see the three year yield getting pretty close for the rba cutting rates. fully priced in, one or even two before the rba has even moved. -- traders are encouraged to look for lowered rates. ray traders think there could be a rate cut coming at some point. haidi: we are also hearing from the governor talking about the trade hikes with china, saying that it could be very bad.

surpriseddy will be to hear that. a hugeout a huge -- it's trading partner for australia. they have so many commodities that come out of australia. they are big investors. they may have lost their number one ranking. they were the top investor for many years. they are still a huge trading partner. it does whatever they say about the relationship. australia keeps an open economy. they will question -- probably push back toward the economy. the rba has a reason to be cautious. things are not going so well with china. haidi: mark cranfield in singapore, great to have you. we take a look at

why the optimism out of those earnings. we find out why. we did into the central banks policy with sarah hunter. this is bloomberg. ♪

shery: this is "bloomberg daybreak: asia." i'm shery ahn in new york. haidi: i'm haidi stroud-watts in sydney. , policyst segment makers see 2019 marking the end of their balance sheet runoff, not necessarily interest rate increases. the news on hikes was less friendly when it comes to financial markets. just a few moments ago, we heard from the rba chief saying the chances of a hike and cut are more evenly balanced. let's bring in oxford's economics chief joining us. they still say it's unlikely that we will see a cut.

he's paid to have a balanced view as to the economy. rba, givenng if the that they are hanging on the strong late market, can they wait until unemployment starts moving up? >> it has given them quite a lot of comfort, there were positive trends beyond the headline increase with full-time employment. the good news is it is using up underemployment. that's what they want to see. in the case that the lake market can be lagging, we would see it coming through in terms of the survey, the hiring intentions, if the rba were hearing in their consultation programs that they are taking a step back on hiring, we may see a cut before we see an uptick in the unemployment rate. the risks are clearly more balanced than three months ago,

in terms of the cuts. i still think they are going to stay on hold through this year. we would need to see a significant negative shock coming through the system, probably from the external environment, as much as the housing market, until they moved. the house price falls we are seeing are big. there are negative effects being generated. they are not surprising. in the context of the previous run-up, the house price correction is on the full side. it's not like we are wiping out all of the gains over the last four or five years. i'm still in the counter that it -- cap that it will be on hold. it is independent. we will see how things play out over the next three months. that will be critical to whether we get a cut. shery: haidi: the property price -- haidi: the property price

slowdown and getting through to consumer sentiment spending, and the range element, is it structural? it is pretty global, the phenomenon we are seeing. sarah: that is part of it. we are not going back to the growth rates we saw 10 or 15 years ago, where wages were going up 4% or 5% a year. having said that, wages at 2.3 from thehe latest data december course. that is low. just beating inflation. we should see a tick up. we'll not get back to where we were. the rba is pleased to see the underemployment rate coming down and still at 5%. it's using up the fair capacity. it will generate pressure in the system. we are already getting that in some sectors, just not broad-based. shery: the governor also surprised to see the reaction in the aussie dollar from the report that china banned caol imports. how big will the downside risks before the aussie dollar given all of these geopolitical

issues? if we see ainly worse thing, the heightening of tensions, we will get some bad news after the trade negotiations, that's another obvious flash point over developments. there is definitely some downsides with the aussie dollar. it's interesting we have not broken through the 17 u.s. barrier. we have been resilient. bad news and growing through that. if we do see signs that the conditions were significantly worse than particularly around china, we may get through that. we could fall quite a long way if we break through. i don't think it's likely. i think we will stay above 70 and stick in the low 70's. if we do get a stream of bad news, we could fall through it. it is quite a long way down before we came back up. shery: modded prices -- will commodity prices helped the aussie dollar? what about the rest of the economy? sarah: certainly commodity

prices do generally help. we have strength coming through from tightness of supply, or additional demand, that's good news for the aussie dollar. certainly it could be one part of the reason why we haven't fallen much recently, because we have strength in iron ore. still, it can still be supported for the currency. in terms of domestic, that is the negative offset. it has an impact. if we wind the clock back six months, when we have the reassessment of the outlook for interest rates on the back of the weaker data coming through, we saw the aussie take a step down. the u.s. and other currencies. it has generally weakened over the other currencies. that's a large result of a relatively weak data slow, domestically compared to the rest of the world. the mystic conditions do matter -- domestic conditions do

matter. playing against one another. it has been a fairly narrow trading bound for the aussie. haidi: it's quite interesting, one of the things in the opening statement was that what we are seeing combined with low unemployment globally is average levels of growth, not below average. -- theif you take out bad news catalyst of a trade war, if we get a resolution, that may mean the outlook for the regional growth will not be actually as bad. haidi: absolutely. that's -- sarah: absolutely. 2018 was definitely a cyclical peak. we are coming off of that. we expect it to become off of the year ago. it's not a surprise at all. a lot of what we are seeing playing out, we expect it to happen. the downside recently said that they are heightened, there are

risks to the downside. if none of that materializes, we do think we will get growth around a long trend pace. that's generally for the region. the outlook is not as gloomy as some may think. it is a marked slowdown. that seems to be worrying markets. from a economics perspective, we were never going to stay at the strong pace of global growth. we were always going to slow. it's no surprise to us, but it can't markets off guard. haidi: materializing more than expected. the other thing is the concern, do we get an undershoot from the central bank? have they limited themselves, in terms of how much room there is to maneuver? what's left in the policy toolbox? sarah: there is that concern. certainly in the case of australia, where we have had discussions from the rba about whether or not they use qe.

they have made it clear it is a tool in the toolbox and they will use it as appropriate. clearly the fed can reverse if they feel the need to. the bank of japan. the bank of japan is the exception to the rule. there's not a lot they have left in their toolbox. they are very much on fiscal policy and the environment. it's a definite challenge for japan. for everyone else, there are some tools left. shery: especially for the pboc. we were expecting them to support the chinese economy. at the same time, this week you hear the premier come out and really be against flooding the economy with liquidity, saying it is not qe, it's a continuation of prudent monetary policy. what does prudent mean in this case when you continue to see the cuts? sarah: i think that's a really good question. what they say,

maintaining growth momentum and maintaining financial stability and not overcooking things. it is interesting that they have responded pretty strongly to the slowdown. we had that in china at the end of last year. you mentioned the rrr cut. we also had additional stimulus slows. credit credit growth was really strong. the key is that they don't go too far. there will be a softening of momentum, just about 6% growth. we think the momentum will hold there. we don't see further slowing, but not a potential turnaround. that is our interpretation. still meeting targets, but not looking to really pump the system up and overheat and raise concerns about financial

stability. it is a balancing act. shery: thank you so much for that. sarah hunter of oxford economics. demar coming up on "daybreak: asia." this is bloomberg. -- plenty more coming up on "daybreak: asia." this is bloomberg. ♪

check let's get a quick of the latest business flash headlines. kraft heinz slumped after hours on profit that missed the lowest estimate in a $50 billion write-down related to trademarks and other assets. the charges resulted in a net of $12.6ome shelters billion. a diluted loss per share of $10.34. the company has received an sec subpoena regarding its accounting policy. pinterest is reported to have filed with the sec for an initial public offering. the wall street journal sites unspecified sources and said underwriters led by morgan saks and jb goldman.

raise about $1.5 billion on valuation, $12 billion in any offering. this is bloomberg. ♪ the latest innovation from xfinity

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>> this is "daybreak: asia." i'm ed ludlow with the first word headlines. trade talks in washington suggest the u.s. and china are moving closer to a deal that would of her new tariffs. .- alert new tariffs $30 billion a year of agricultural products, including soybeans, corn, and we'd. it will be part of a range of agreements. the new purchases would be on top of levels from before the recent trade war. of china is bank signaling it will use further focused stimulus to guide liquidity a particular part of the slowing economy. enhance a combination of policy tools, such as reserve

ratio cuts and medium-term lending stabilities, according to its costly policy report. rrr cuts have become favored to avoid flooding the system with extra cash. hong kong monetary authority norman chan will retire on october 1. the 64-year-old took charge a decade ego and will retire. it's an attractive job. he's one of the best played global central bankers. he earned $1.4 million in 2017, at least four times more than the boj governor. seven times more than jay powell of the fed. and goldman sachs will start testing a jointly developed new credit card in the next few weeks. apple has been investing in payments and other services while goldman is trying to deepen its push into consumer finance. a wider public rollout will come later this year. nike is facing a potential pr

disaster after a high-profile basketball star sprained his knee when his sneaker fell apart 30 seconds into a game. tofell when his shoe seemed collapse as he tried to change direction. is expected to be the top pick in the nba draft. global news 24 hour day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ed ludlow, this is bloomberg. asian markets looking pretty mixed. let's get more details from sophie kamaruddin. sophie: not much in the way of tgif vibes. stocks looking next. a sex 100 rising for a second day. molitor rideslar continue after getting battered by this. jobs data and under pressure for two rate cuts.

k china putting the aussie under pressure. it's now gaining ground, headed for a weekly decline. nikkei 225 first day at the end of the week. we're seeing the cost be under pressure, off one third of a percent. checking one of the laggards on the coskospi. pledging to its lowest level since august of 24 after plans to raise $850 million in a new share asset sale. slashedtheir prices -- their prices. minerals extending declines after thursday's 10% drop. the miners first-half learnings came in by higher revenues and cause. weakness in all the coal stocks, like new hope, up 4.3% amid concerns of the import ban from

china. it would not be sustainable beyond a few weeks with some factors cited by cba, including the point that it would violate the bilateral trade agreement between china and australia. this let's get more on coal ban. james has more. we heard australia's treasurer downplaying the implications and saying they are trying to seek more information. not specifically to do with australia, they reviewed these things depending on environmental policy. is it a ban, cut in the quota? >> we are all seeking clarity. stands, the big moves we saw in the market yesterday were driven by the report. that has not been confirmed by anyone in the chinese government. we need someone to come out and say what the state of affairs is. we don't know whether it is a ban in the daily port, across all chinese port, or taking

longer to process. we need clarity from the chinese. mean --erience suggests we may wait a while to see the clarity. if the situation continues for a matter of days, it will be on the australian government to tell us what is happening. shery: we had seen stability when it comes to australia's exports of coal. this chart showing where we are at when it comes to those exports. this would be your line in blue. we also saw a little bit of a rebound in coal prices. what does this mean for the coal industry? reports aree correct and australian imports are being respected -- restricted, supply will be restrained. in some ways, that plays well.

if australia can find alternative buyers. they will not make those decisions just yet. they want to see how this plays out. if thericts -- restriction proves to be long-lasting, it has huge implications in china as the second-biggest receiver of australian coal exports. it's hard to underestimate the impact on the industry. haidi: the political context is something that a lot of investors are worried about. essentially it's some sort of a retaliation for the 5g network banning of huawei last year. james: and china has a past history of using trade policy as retaliation to instances like the huawei ban. australia did last year. is how long now will it go on for? there's a report saying it is not really in china's interest

for it to extend beyond a matter of weeks. they need that. it is a key time in their production season, after chinese new year. that's when they ramp up coal production. being deprived of that quality australian coal, they cannot get the same quality from indonesia. they are probably making a statement. that's probably fair to say. in the long run, they will probably normalize relations. haidi: we will continue to wait and see. james thornhill with the latest on this suppose it coal ban or cut of quota in australian coal imports in china. softbank beating its earnings. we're crunching the numbers next. this is bloomberg. ♪ berg. ♪

shery: this is "daybreak: asia." i'm shery on in new york. haidi: i'm haidi stroud-watts in sydney. chinese search engine by do is

giving a forecast for the fiscal first quarter, projecting revenue will rise in the march period. this as new content and products helped. it's on ai and other services. u.s. china trade tensions continue to escalate. stephen engle has the numbers. what has popped out to you? stephen: they were better than expected. about halfrofit was of last year. they are spending a lot of money on content and building out their super app platform of all of the different services. , ms. consensus. half of the profit of a year ago. the fourth corner adjusted the consensusat estimate. came in at $1.92 per abr. we were expecting $1.74. revenue was probably what popped

out. $3.96 billion. that beat the highest range of estimates. also the guidance for this revenue,irst-quarter between $3.2 billion and $3.6 billion. it was in line with consensus. it is a rise of 12% to the products are energizing the ad business. that was the key going in. the back companies of baidu, alibaba, and tencent, baidu relies more heavily on advertising spending. when the chinese economy is slowing down, that hurts ad spin. they have a lot of it siphoned off to upstarts, like bike dance. haidi: how do they plan to fight back and offset that, depending on advertising going forward? stephen: they need to build out these other services. i mentioned the content. the ite netflix like video

drag.e was a bit of a they are investing a lot into that. they are also going into artificial intelligence. they have thisa -- ai service like alexa, they want to draw different connections between their services and hopefully draw into advertising. they have the apollo autonomous driving. they have a number of different things. maybe you can to what tencent has been able to achieve with this massive ecosystem of wechat, a one-stop spot for web and services on your handset. shery: thank you so much, our chief north asia correspondent. let's bring in lina choi and continue discussing baidu and other china tech companies. very strong numbers out of baidu, at least for the latest reporting season. how much would it help their credit profile?

>> this is indeed pretty much in line with our expectations. for the full year, we are not focusing as much on the quarter over quarter. there has been seasonality. ofyou look at the whole year 2018, really a quite solid performance, in terms of revenue margins. more importantly, we look at operating cash flow. this would allow the company to keep a very solid cash flow generation capability. toe importantly, it adds on its already very strong and that cash position. in the end of 2018, that position has expanded to 24 billion rmb, which is quite strong. shery: when you compare it to its peers, it hasn't done that well. this chart showing that baidu now has the lowest price earnings multiple of china.

how vulnerable are they to further economic slowdown in china? i don't think we are in a position to comment on the stock valuation. we can say that from a ratings company,ve, this credit quality, has been strengthened. a3 ratingcted in the for baidu with a positive outlook. that means there is a path to a higher rating level. that is supported by the company's consistent cash flow generation ability. when i mentioned earlier, a very strong strengthening balance sheet. we do see some challenges in the coming year in 2019 because of slowdown in economic growth in china. that will have a different

extent of impact on different industries. baidu being the core business, being search advertising, is indeed quite tight to the economic cycle. don't forget, it does have a pay for performance. it does provide targeted marketing tools for advertising clients that would return high return on investment. historically, we do see that baidu's advertising revenue is outperforming the overall advertising industry because of this targeted and higher feature. thei: how vulnerable is company, as well as the rest of the internet in china to continue trade tensions between the u.s. and china? lina: the chinese internet companies are not directly exposed to impacts from u.s./china trade tensions.

the vast majority of their revenues are generated from within china. they do not have a reliance on any u.s. ip to operate their businesses. over the medium to longer term, we do see the potential knock on impact of trade tensions dampening spending. it could have negative impact on the overall consumption desire of the economy. that would probably have some medium to longer term impact on the sector. haidi: what about margin pressures from its various investments? how much spending diverging aspects like a.i.? lina: that's a very great question. we have seen the need, the requirement to reinvest in growth engines across a lot of chinese corporate. technology and internet companies, in particular. the way we look at investments

required in the system, these investments, new business , they do not necessarily contribute a lot of cash flow or margin probability to the overall company. however, they do enhance the effectiveness of the core business of the chinese internet company by increasing user engagement, for example, or in baidu's case, all of these a.i. developments they are working on. it provides better targeting tools for advertising clients. help themurn, will generate more cash flow and strength in the credit quality. haidi: whether it's ai, big data, robotics, we have seen the chinese government really pushing into these new technologies. who will be the biggest winners? lina: it is a really early days

for the chinese internet companies. all of them are doing different things in different approaches trying to strengthen their big data capability. that all ofind these large and open platforms have some different sources based on their core business model. a really big pool of data. that is growing day by day. they are probably using that big data in a different way. it has been focusing on ai development in the last couple of years. tencent has huge consumer data that allows it to profile the consumers on its platform in various different ways that understanding the that this company has of its consumer base. alibaba, being the largest

e-commerce platform, has very relevant and then you will transaction financial data from consumers on this platform. it is early to say how exactly they can monetize from the data. really great to have you and great to have that insight. lina choi of moody's investors service. we will bring you a brand-new bloomberg markets china open live out of beijing monday as we launch our new state-of-the-art studio in the chinese capital. we have all the latest from the great guests to break it down and a look at the impacts on the markets and the global economy. this is bloomberg. ♪

haidi: this is "daybreak: asia." i'm haidi stroud-watts in sydney. shery: i'm shery on a new york. a quick check of the latest business flash headlines. struggling dancer bank froze are steepening as the sec has joined the list of regulators investigating money laundering. the bank is already the target of degrees in debt markets and is being investigated by the u.s. justice department. they have admitted that much of the $230 billion that passed through their arms was painted. haidi: a tiny dairy company has come from almost nowhere to become the most valuable company

in new zealand. capour years, the market surged 3000%, making it worth $7.5 billion. the demand from china for its success and is expected to take a big share of the infant formula market from global players. shery: tesla took a hit as the consumer report magazine dropped the model three from its top 10 rankings, saying owners have complained about issues such as loosefitting parts and defective. it's a different story for theru, which topped customer reports ranking for the fourth time. they have ramped up more than seven years of consecutive monthly sales growth in the u.s. haidi: watching two singaporean banks as trading kicks off. posting fourth-quarter results that missed estimates following the market turbulence late last year. let's get over to haslinda almond. h disappointment all around. sa: you bet, given that

they were going to put new numbers. instead, they were hit by a drop in its trading operations because of financial markets. profit, looking at the numbers, that came in at 960 million sing dollars, an increase of 7%. the same story for ocbc. short of estimates, profit coming in at 926 million sing. the market was looking for more than one billion. this is a surprise. provisions for the nonperforming .oans exceeded forecast 1.5% versus 1.45%. years of solid growth for singapore banks, now it seems a slowdown. market weakness, volatility, even the loan growth remains

strong. that momentum is waning. the banks under a lot of pressure. the stocks already reflecting the weakness. shery: given the weakness, especially in external markets with the trade tensions, what's the outlook for the singaporean banks? it is not looking great. it is a double whammy. china slowdown, the trade war, there are huge slowdowns. also singapore banks, dbs is the highest loan exposure to china. and 25.15 with china's economy decelerating, slowing with a prolonged trade tension with the u.s., loan growth in china, expect it to be under a lot of pressure. the impact may be much worse than 2015, 20 16 even, when the chinese consumer sector was badly hit. add to that another headache, the stress at home in the singapore markets. singapore banks slowing due to the weaker sentiment. all the concerns globally playing a huge role.

he also have the measures putting a lid on the property prices. market business is taking a hit. home loans. take a look at the numbers, they account for 30% of the growth portfolio. some about 4% last year. the previous year, that slowdown may persist. if you stick to bloomberg intelligence, they will tell you it is likely to get stuck below 2%. singapore banks feeling the heat. going forward, at least. shery: thank you so much for that. our chief international correspondent for southeast asia, haslinda amin. let's get a preview of what to watch in markets this morning. here's sophie. sophie: more earnings on the radar in singapore. keep an eye night on the world's largest oil refiner. this after the company posted a 53% slump in fourth-quarter profits as it concluded that included an impairment provision.

on china and hong kong with its earnings do. we are watching chinese and related stock and prospects of china buying more soybeans, corn, wheat. a round up of january data points do this friday. china expected to slow prices. later, better trade figures. inflation numbers are due at midday. this evening, taiwanese export orders on the schedule likely to have contracted for a third straight month in january. haidi: before we headed over to "bloomberg markets: asia," how markets are trading in the friday session. 225, not too much of a reaction to inflation numbers that came in. missing estimates 3.10 percent lower -- three points of 1% lower. in australia, downsides to some of the coal miners on the back of that report on the chinese coal ban seeing resilience.

futures as well. fluctuating between gains and losses. on change, we see a bit more pressure for a taiwan futures. chinese futures closed down about four hours ago. really not a lot of movement when it comes to the offshore yuan, which has held steady at that level through the entire week. that's it from "daybreak: asia." markets coverage continues as we look ahead to the start of trade in hong kong, shanghai, and change in. bloomberg markets china open is next. -- thisbloomberg area is bloomberg. ♪ i'm a veteran

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>> this is "markets: china open." >> china is offering to buy more u.s. food as the two sides edged toward a deal. >> the rba governor said there's , butth on interest rates telling parliament he is -- cheaper oil threatens to undermine the bank of japan. the 2% target looks way out of reach.