haidi: very good morning. australian markets have just opened for trade. shery ahn: good evening from bloomberg world headquarters in new york. sophie: welcome to "daybreak asia." >> wall street slides that to extend in asia. s&p 500 falling for a fourth straight day. investors further spooked by grim news out of europe.

mario draghi cut forecasts and offered more stimulus. and tesla is one step closer to making model 3's in china. >> we have breaking news from .outh korea this is much narrower than from decemberous month of when it had come in at $4.8 billion. in the previous month of december, it came in at over $6 billion. of course, we have seen risks in the export market, also in investments. we have seen some slumps in the korean economy, declining overseas sales in china, not to mention weakness in shipments of semiconductors and oil products

and the current account surplus coming in at 2.70 $7 billion, which is smaller than the previous month. the good trade surplus also at 5.60 one billion dollars. let's get a check of how markets closed in the u.s. we saw more downside pressure with the s&p 500 falling for the fourth consecutive session. the longest losing streak this year. also below that 200-day moving average. the biggestwas drag. s&p futures unchanged at the moment but we are seeing a little bit of pressure. let's see how things are shaping up with asian markets. sophie: asian stocks could be headed for a second weekly decline. in asia, we are watching for tech stocks to track their u.s. peers lower as well. aussie stocks set to snap a two-day advance. the aussie dollar has had a rough time of it this week,

testing 17 once again on the dovish ecb and the drop in metals prices. i just want to highlight one mover, we have automotive holdings sliding as the stock has been removed from the benchmark asx 200. that is a look at what has been going on. >> thank you so much. let tont mario draghi the head of the european central bank pack. bloomberg global economics and policy editor kathleen hays is here. the clear the ecb is taking slowdown quite seriously. >> the german bund at its lowest since 2016, the euro at its lowest in 2017.

that offered to a new their targeted loans to banks so they could loan more and stimulate the economy and they will keep their rates at record lows for longer, maybe until 2020. the persistence of uncertainty is related to geopolitical factors, the threat of protectionism, and appears to leave a mark on sentiment. the risks are still to the downside. here's what mario draghi said about this in answer reporters' questions earlier. >> you just do what you think is right. you temper, however, what you do with uncertainty. in other words, in a dark room, you move with tiny steps. >> the ecb, of course, is reverting to stimulus, these targeted long-term refinancing operations, just three months

signaled they would possibly be raising their key rate after this summer, so that looks to be off the table as well. suggest it'snomics rather critical, they say the and bloombergical news, another scoop today, finding out that some of the ecb officials doubt the outlook for 2019, which includes a view that andgrowth will rebound in the becausealf of the year they do not think potentially this will be enough, that the risks may materialize even more severely. it is still a rather uncertain stance. >> we saw government bonds react severely. rallying. is there a new risk of global

worries? >> don't you kind of get that feeling? imagine going into the end of 2018, the fed was going to hike rates so much more in 2019. weaknessging off its in the euro area, but the index coming out today giving a global view -- i think it is pretty worrisome to a lot of investors. see how itng to depicts the since people have maybe things are getting worse than they were. the economic surprise index, it means there more surprises to the downside when countries issue the economic reports than there are surprises to the upside. look how the numbers get bigger and bigger and bigger as we go run the u.k. to emerging markets, china, g10. u.s. getting close to the bottom, japan even more so, but the eurozone is the weakest of

all right now. tomorrow, everyone has their focus -- or today, i should say, because it is friday in asia -- on the u.s. jobs report. that whatbmit to you the european central bank did this week is probably the big event carrying over into the weeks ahead. the fed governor who is reasonably dovish said the rising risks are arguing for a softer policy path and i think the risk on that jobs report is not that it is strong. the risk is that it is weaker than forecast, kind of feeding into the services that kind of feeding into the fears people are getting about the global economy. -- feeding into the fears that people are getting about the global economy. >> kathleen hays, the bearer of all bad news.

in just a few minutes time, we will be joined by fixed income head to talk about if we are seeing a resurgence in global bond markets. let's get you to first word news with ed ludlow now. is said to have made an offer to break the brexit impasse, although short of what theresa may has been demanding. sources say it focuses on the review system. president trump's former legal fix it is suing for what he claims are unpaid legal fees and costs. n filed a breach of trust suit saying he is down .ore than $2 million

president trump has forgot lead announced cohen as a liar. blackrock chief larry fink is a self-professed critic of modern theory saying it is garbage and deficits matter. the u.s. deficit is on course to top $1 trillion and jay powell, larry summers, and paul krugman are all critics. larry fink says it is not a good approach. >> that's garbage. >> you are with jay powell on this one? helpising taxes does not economic growth and more importantly, yes, i am a big believer that deficits do matter. i am a big believer that deficits are going to be driving andrest rates much higher could drive it to an unsustainable level.

intelligencea's agency says the north has resumed work on a long-range missile site with operations possibly beginning before the hanoi summit took place. satellite images indicate work at the site took place somewhere between february 16 and march 2. 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. >> thank you. another major story we're tracking today -- tesla reaching an agreement on more than $500 million in loans from chinese banks to build their giga factory in shanghai. david welch joins us with details. imagine tesla is glad for this positive headline for a change.

>> that's right. they raised $521 million and freed up some other borrowing, upwards of another $200 million, which is necessary because they want to start building model 3's in china by the at the year. they have been saying quite some time they were going to raise money from local banks. this is the culmination of something big for the company. he has been negotiating this deal for a couple of years, so there is as much demand for electric cars in china as elon says, it could be quite a coup for the company because they want to start building by the end of the year. >> this, of course, comes fresh off tesla's largest ever debt payment last week. how solid is their financial situation right now? >> the payment was for $925 billion. they have $3.7 billion for that, so they should still have plenty of cash.

they have been saying all along they were going to raise money locally for china, so there is not really a cash crunch going on at tesla unless there is something as we do not know that is going on. no one has really flagged that. the big thing for the company's they found a new source of funding to get this plant going. the big challenge now, of course, this is tesla. they say they will build model three's in china by the end of the year. always a big challenge for the company is getting production to go, getting it smoothed out and hitting their targets so they can meet their cash obligations. >> tesla is the first foreign automaker to really wholly owned a manufacturing facility in china. how much progress have they made in this market? >> they have been exporting cars . there is real demand, but you have to pay big tariffs going in the market and that is a big constraint. even though there is a lot of demand over there thanks to some government subsidies and also government mandates, they have

the wind at their back in terms of getting demand for the cars, but they really do need to build in markets if they are going to have any hope of gaining serious market share. tariffs are a real impediment to anyone going in. having local production just boosts the number they can actually sell. it's a big deal if they can get this thing up and running on time. >> always great to see you. ahead, we have numbers on japan's economy later this hour. we will look at the state of the japanese consumer, which faces a tax hike later this year. >> next, finding opportunity amid rising concerns about global growth. they are building. this is bloomberg. ♪

>> we are counting down to asia's first major market open this morning. this is how japanese futures are shaping up. a down day yesterday largely across most parts of asia, looking like another down day. nikkei futures to the tune of 150 points lower. we did get the longest losing streaks now for u.s. stocks that we have seen all year. really it is these concerns about weakness across global growth after the ecb cut its forecast. >> in u.s. stocks on the longest losing streak this year and reasons. two main the dollar strengthened for a seventh day. su keenan is here. >> there's also a concern by analysts that u.s. companies, it's going to be harder for them to show positive earnings growth if we are seeing the rest of the world slowdown.

the financials were among the weakest groups. features relatively flat at this hour, but let's go into some of the big movers. a lot of red on the screen. technical analysts are looking at the charts from both the nasdaq, gigi the is where you can find our library of charts. the nasdaq back below its 200-day moving average. you are also seeing the s&p 500 dropped into a lower range, analysts say. take a look at some of the regular movers in the regular session, i should say, and you will see what the concerns are about. burlington stores, a big company, had a record plunge, down as much as 15% intraday. , mrs.s are earnings

estimates. kroger, a grocery store, competing with amazon, among other issues. online e-tailer, also disappointing outlook. have marble technology down as a report a disappointing outlook. we did get a bid for oil in the regular session and that is not a surprise. much.nk you so always great to have you with us. seeing economic risks basically everywhere right now. if you are in asia, how troublesome is the global economic slowdown for asian economies, and can you still

find opportunities their? >> certainly a great question, especially in light of what the ecb did, paring down growth expectations very substantially, but i think it is important to is aheadind that china of the curve in terms of having actually started to step on the gas pedal. ofn you add up the slow drip economic stimulus that has been taking place over the last several months, we estimate that to be about 1.5% of gdp. cuts, welatest tax also think all of this will actually come together to stabilize the economy and make sure that there will not be a hard landing. withn asia perspective, -- an asian perspective, we're constructive. certainly here to date, there has been a much more bullish sentiment and we have definitely seen markets rally on the equity as well as the bond side, and given the relatively sanguine

do thinkoverall, we that it is actually a good time. we're not talking about going substantially subgrade credit, but it could actually be a good return. >> is not just china, it's actually the boj. we just heard from the blackrock ceo, larry fink, talk about this turn dovish. take a look at this. >> i would almost call this a goldilocks moment where it's not so bad, not so good. central-bank behaviors are probably more on the dovish side now from where they were in the fourth quarter, so i would say it is time for investors to be a .ittle more relaxed >> were policymakers a little too late in the game or were

they just in time to address the slowdown? >> central bankers are really not there to provide forward backstop if you look at the markets. the current fed has been especially cognizant of being opportunistic and looking at the data very carefully to make sure that they do not tighten too much. in fact, if anything, it looks like there is a higher likelihood of some type of a cut at the end of this year, so i think that the central bankers are doing a relatively good job in the u.s. japan, the issue is they just do not have much ammunition and i think this is what has been driving the differential in the growth as well as in the rally in the dollar recently. to throw out this

chart. i know it is friday. the downwardo revisions, the growth forecast for mario draghi, we also have this report from citibank. across is negative right the world godless of the if you're looking at yellow, purple, -- it sees negative right across the world, regardless of if you are looking at yellow, purple, china in blue. as a feel like we are at the cusp of something interesting happening to the bond market? >> a think the big question was for a while, is inflation to , and i think back the mild inflation we have seen could be attributed to much more cyclical components, so overall,

we actually like receiving rates in those markets, especially markets like in india where we think they have done a thetively good job with inflating expectations dragon. i do think there might be a little too much negativity in the near-term, but we must keep in mind the u.s. is coming out of a very strong base, so overall, i actually quite agree with larry that it's actually a .ood time >> you are also joining us on international women's day. i have to ask, as a woman who works within finance and business, what do you think the single most important thing is to do in order to bridge the equality gap? >> i think it is really important to start with an examination of our own unconscious biases. in today's modern world, it's fascinating that we actually leave our deepest and darkest

desires in internet searches. according to google, the words " is my son gifted" is googled two and a half times more often than is my daughter gifted." consider that for a minute. to me, that starts with recognizing unconscious biases with respect to people we care about hopefully we can extend to the workplace and beyond. >> thank you so much for joining us. you can get a roundup of the stories you need to know to get your day going in today's edition of daybreak. you can customize those settings. you just get the news on the industry and the access that you care about. this is bloomberg. ♪ you can customize those settings. ♪ you can customize those settings.

>> a quick check of the latest business flash headlines. the bank says money shares are unwarranted. socgen is lowering be it's been a hold, rio tinto to sell. >> the sec has caused its review takeover ofs sprint. the deal has drawn criticism for potentially reducing competition and the merger still needs approval from the fcc and antitrust regulators. ing has reduced its bonus pool by 20% every year that was hit by a record money laundering cinema. the lender paid of 300 million euros, about $300 million in

bonuses, down from 400 million euros and 300 million euros the year before. this is bloomberg. ♪

ed: this is daybreak asia. fell against the dollar from a state of years after the ecb cut its outlook and promised more support. the common currency fell nearly 1% while the bloomberg index surged to its highest level of the year so far. mario draghi says the eurozone will now grow only 1.1% this year, .6% low the forecast just three months ago. a fed governor says the weakening economic outlook in the u.s. and abroad supports a softer path for interest rates been central bankers previously forecast.

fed officials turned more dovish in january, using the word patient. bloomberg has been told the money laundering scandal affecting european banks is merely the tip of the iceberg $1 there could be as much as trillion. it's a deal is a is already in the system or is looking for .ays of moving >> our investigation continues nolead to new evidence and suspicious transactions and as long as it does, we will take that evidence and follow it wherever it leads and when we find money and money laundering, we will make complaints to the law enforcement agencies. party the nominated president sister for

has suspended. her brief political career ended when the king publicly denounced the move as inappropriate. global news 24 hours a day on air and at tictoc on twitter powered by month and 2700 journalists and analysts in more than 120 countries. >> thank you. we get straight to the market action. >> aussie stocks are retreating from a six-month high. the s&p 500 off .1%. tech stocks led lower by the materials in financials this morning as the aussie dollar hovers around 18 of-month low while bonds continued a debt rally. flipping the board to check in and changes to take effect.

flipping the board once more, we extendingd rio tinto losses after more pressure coming through after both were downgraded at societe generale. theen says it makes for gains for mining shares unwarranted. >> sophie kamaruddin there and hong kong. exports seen falling in february after a surprise jump in the previous month. what are we watching for? >> you will remember that that and export we got for the month of january did, as

you say, come as a surprise. many putting that down to seasonal effects. you had a lunar new year, so you had a view that factories work ramping up production. the view is the expectation is we're going to get a contraction in exports as though seasonal effects are washed out. the expectation, a drop of 5% year on year compared to about 9%. some of the pmi subcomponents pointed to continued contraction in exports. terms of imports, we are looking at a contraction of .bout 0.6%, a little less bad >> on the potential u.s.-china trade deal, what are we hearing wantinginese officials to ink this agreement? >> they are getting quite cautious.

the new york times suggesting that a quick deal may not ultimately be in china's interest. a point whereto the president's are set to meet in mar-a-lago may be at the end of march, but the details around enforcement still have not been ironed out. the debate here in china about how to proceed along those questions and in washington as well and there are some of the trump administration who want to use tariffs to ensure that enforcement is effective, so the question and that debate continues, so it is a bit of a conundrum for chinese officials. of course they want to get a deal because so far, the framework suggests they will not have to put too much in terms of concessions. they will be buying more products and lowering tariffs, but in terms of structural reforms, it does not seem we will get anything major from the chinese. they want to get a deal, but

they are concerned enforcement details have not been ironed out yet. >> we are getting more warnings about the chinese yuan. is it time to turn bearish on the currency? >> it is up about 3% since the beginning of the year and forecasters -- forecasts suggest it is going to get stronger from here. he is saying ultimately if there is even a mild recession in a couple years time, that is going to have a disastrous effect on the chinese economy. they're going to have bankruptcy and that will force the chinese to devalue the yuan, he says potentially up to 30%. as of the trade deal, which could include a clause about giving the yuan stable, he is saying that is essentially nonsense if there is a mild recession.

>> investors continue to be concerned about global growth, blackrock's boss says the economy is actually in a goldilocks moment. he spoke exclusively to bloomberg at the blackrock wealth symposium in zurich beginning with china. >> china is slowing, but it is to 6%. that's not so bad. >> that's what they say. >> ok, 5%. cities are still growing quite nicely. it is the outer regions. china has experienced the same two-phase, two type of economies where one part of the economy is growing very well and one is slowing down. they will experience the same type of maybe populism, unrest issues in the future. japan is growing at 1%. south east asia is actually growing quite nicely. you see supply chains moving from china into the southeast

asia region. europe, which compared to where we were in january, march of 2018, is -- you know, we were much more pessimistic and i am very worried about europe. that does not mean europe will be into recession for 2019, but it is not going to be -- maybe, just maybe it is a 1% growth, probably closer to zero. in the u.s., we had the sugar high from the tax reforms. that theticipated economy would slow down after the sugar high, and that is what is happening, but where is the u.s. economy this year? it's not so bad. consumer confidence is still good. so i would almost call this a goldilocks moment where it is not so bad, it's not so good. central-bank behaviors are probably more on the dovish side now from where they were in the fourth quarter, so i would say it is a time for investors to be a little more relaxed. i don't think we're going to go, you know, much higher than we

are today. >> you mean stock prices? >> but we are going to be fine. what i worry about still is rising populism, which what we're witnessing from rising populism is we are seeing shorter-term behaviors by governments. i talked quite a bit about long-term behaviors. >> you do. >> it gets harder and harder when you see governments the coming more and more short-term. >> that was larry fink, blackrock's ceo, speaking to bloomberg's erik schatzker. let's turn to brexit. the eu has come back to the u.k. with a new offer to try to break the deadlock. with the deadline just three weeks away. >> that's right. it comes down to the one major concern we have been talking about that is the irish backstop. this is the channel, the passage the keeps ireland linked to the eu. many ministers of parliament do

not want to be held to the eu's customs rules. let me walk you through the actual offer for the second session here. basically, it is meant to speed up the process of replacing that backstop with something theoretically, at least, better. good luck on that. review system already agreed to, which is six-month chickens. the eu trying to give the u.k. legal assurances that it does not get stuck with eu rules as pre-brexit, but interestingly, it does not go far enough in for thatu.k. demands unilateral follow-through on an exit if it wants to do it by itself. it goes further than eu concessions back in january and we are waiting on the u.k. to reply to that. meantime, we did see reaction in the currency, the british pound, and we can see that little spike at around 12:00 or 1:00 p.m. on the left side of your screen -- that is when this news crossed and we saw the british pound par

e some of its losses. it was very short-lived, very ephemeral, nfl back to their session lows. right now in active trading, it is barely unchanged. except if theresa may the eu's latest concession on the irish backstop, british lawmakers still have to be convinced. >> they have to be convinced, be, really, they have to convinced again. on this possible offer

of concession, the rest of theresa may's plan will stay

unchanged. over two months ago when members of dovoted on this, what did they ? it was the biggest defeat in one in the past 100 years. a lot of eu officials, some nations are not holding their breath that anything is going h. officials say the next 72 hours will be the most important here as folks on both sides try to

hash out these concessions and legality ofthe

these things. we're looking at next tuesday finally goes to

parliament

there's a lot of questions >> how difficult is that for the government to address that through structural reform? >> i think it is still a work in progress. numberswise, it is -- wise, it is better in participation of women. women are getting back into the workforce. however, the question remains as to the quality of work for women. do they really have environments where they can thrive both in korea and families? that is still questionable. >> what do you think is the biggest single thing that

should be done to bridge the gender equality gap? >> i would like to highlight tot it is very dangerous label women's issues as just a women's issue because then we will fail to attract the wider audience. it should be understood as a part of more of a broad program to really revamp and modernize japan. invite more men and leaders to the discussion of the gender issues. thank you so much for that. we have breaking news on the bloomberg terminal. stormynt trump beating daniels lawsuit over a hush agreement. this has been an ongoing issue for the president. president trump cannot be sued over the validity of a withsclosure agreement

stormy daniels. he said he was not going to enforce a hush deal to keep her purportedut their footing. we will get you more details. japan awaiting those economic numbers including gdp in the current account balance. haidi: that's right. we are getting those numbers crossing the bloomberg. japanese fourth-quarter gdp, the on an revised, rising annual basis, beating expectations of 1.7%. we are seeing nominal gdp rising slightly higher than .3%. quote unquote it. half a percent gain. slightly better than expected. we are seeing a couple when it businesscertainly spending but private consumption rising a bit less than expected. let's get some more analysis. kathleen hays, you are looking at these numbers as well.

is there a sense that the fourth quarter might have been a bit of a peak in terms of what we are expecting for the fourth quarter? kathleen: these numbers already beat the consensus pretty handily on the gdp at 1.9%. 2% year-over-year. the forecast is for 1.7%. bloomberg economics was pleasantly surprised by this number. they were looking to weaken a bit to 1.2%. there is concern about the health of the japanese economy. we just saw household spending coming out up to 2%. that is much stronger. some people thought that would be negative. we can get a good reading there. we can see the yen taking a little top there. i don't think mine is exactly updated yet because it does not show the big jump we just had. at any rate, it is a good sign,

oomphn that there is more to this. we have the current account balance coming in much smaller than forecast. is ¥600 billion. that is beating the forecast. exports, imports, those are the questions. and maybe itd makes the boj feel a little bit better, too. shery: we are hearing from the finance minister speaking in tokyo saying they are not thinking about any new economic countermeasures and we are not in a situation of needing extra measures. this coming after the huge stimulus from the boj. you have to keep this in context. what i found interesting is business spending because a lot of the countries in asia, when , really lowcapex

on that. business spending seems to be in pretty good shape, rising 2.7%. estimates had been -- that probably even air's again better than some of the boj had been expecting. it is important as they go into this meeting to get some sense that the economy is holding up better than it might with china's economic slowdown. could hit exports with the trade tensions ongoing. we just had a guest saying it is not going to be as bad as the last tax hike. not hittended to people. some people say it will not raise that much revenue because it is designed to not take too big of a bite. it is not going to hurt the economy.

one more thing about to add about the meeting next week, our new bloomberg economics tracker is saying it could be down to zero over the course of this year. there is not too much more we can do, many would say. the new monetary report. >> kathleen hays, thank you so much. plenty more to come on "daybreak asia." this is bloomberg. ♪

shery: let's get straight to the markets and a preview of the open in japan and south korea. here is sophie kamaruddin. hinting atures are losses integer and seoul at the end of a choppy week. they are seeing that all reaction in the yen. we are seeing it hold two days of gains and spread higher overnight by the ecb. that is for the yen. when it comes to stocks to watch, this company may move after widening its

expectations. tariff exemptions for japanese products in just over 40% of waiver requests by american .mporters it increased sales of about 38% last month. we are keeping an eye on pioneer, which is among one of the hottest names in electronics. the stock is said to be replaced and likely to be delisted later this month after slumping 72% last year. four potential candidates are seen among them. i will pick it up from here. coming up on the next hour of "daybreak asia," we are hearing from some big guests on this international women's day including kim stafford.

japan and opens in south korea are almost upon us. this is bloomberg. ♪ you.

all of you. how you live, what you love. that's what inspired us to create america's most advanced internet. internet that puts you in charge. that protects what's important. it handles everything, and reaches everywhere. this is beyond wifi, this is xfi. simple. easy. awesome. xfinity, the future of awesome.

haidi: very good morning. i am haidi stroud-watts in sydney. good evening from bloomberg's global headquarters in new york. i am shery ahn. sophie: i am sophie kamaruddin in hong kong. welcome to "daybreak asia." haidi: our top stories this friday, the wall street slide set to extend to asia. u.s. stocks on their longest streak this year. investors further spooked by grim news out of europe. as mario draghi

offers more stimulus. we get trade numbers out of china, and exports are seen falling after january's surprise gain. shery: breaking news on the bloomberg. we have now the final sentencing for president trump's former campaign chairman at her come up -- campaign manager, paul manafort. the judge has sentenced him for three years, 11 months, for bank and tax fraud. defrauding banks that clinton money. he has been charged for eight felonies that could amount to as much as 24 years in prison. the judge has now rejected termal counsel mueller's as unwarranted. the judge now thinking that the 19 to 24 year term is unwarranted. the judge has sentenced him to three years, 11 months for bank and tax fraud.

that would be cheating the u.s. out of more than $6 million in taxes and defrauding banks that clinton money. paul manafort was cooperating with the special counsel's mueller's team. we had her the prosecution. heard theot -- prosecution. they were not liking that he lied during the debriefing. rejecting the endorsement of a sentence of 19 to 24 year term as unwarranted, and he sentenced him to three years, 11 months for bank and tax fraud. we will get you more as we get them. manafort has been charged by other felonies as well including hiding $55 million abroad. let's get straight to the market action in asia with sophie kamaruddin. sophie. sophie: in sophie: tokyo, we are seeing the nikkei 225 and topix extend the clients. in tokyo, we are

seeing the nikkei 225 and topix extend declines. we have in that report a 1.9% rise for fourth-quarter gdp. this misspending coming in as expected, but private consumption was less than forecast. flipping the board, the cost be continuing to lose ground after seeing declines over the past five sessions. you have hsbc urging caution on korean equities. they are among the most overvalued markets and lowering korea to underweight. i want to highlight the how -- i want to highlight this company. that is according to local reports. flipping the board to check in on aussie shares, which are retreating from a six-month high. set to snap a today klein -- two-day decline. kiwi stocks are rising for a

third straight day, set for another fresh all-time high. showings morning they rebounded in the fourth quarter. haidi: looking ahead, we are hearing some big guests on this international women's day including can stafford. the beat -- kim stafford. young china ceo. let's get you the first word news with ed ludlow. says u.s. tariffs on car imports would further harm the global economy and europe will retaliate if they are imposed. the trade commissioner told is preparing e.u. a draft list of possible targets worth 20 billion euros. the u.s. commerce department submitted a report to president trump. were to happen, and i really hope that will not be the case, we will have to impose rebalancing measures, and then our relationship on other areas would be very difficult.

>> the fed governor says the weakening economic outlook in the u.s. and abroad supports a softer path for interest rates and central banks previously forecast. in a speech, he said a modest slowdown in the pace of rate hikes could offset some of the weakness weighing on the economy. officials turned want to visit -- more dovish in january. the e.u. is said to have made a new offer to the u.k. to break the brexit impasse although it fell short of what theresa may has been demanding. sources say it concerns the so-called irish backstop and focuses on bolstering the review system. conservative hardliners are arguing about how long the backstop should be and how the u.k. should withdraw from it. president trump's former legal six or is suing for what -- fixer is suing. he filed a brief of contract

suit against the trump organization. $2says he is down almost million in expenses and the same and penalties, which the organization has promised to repay. president trump frequently denounced him as a liar. global news, 24 hours a day, on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am ed ludlow. this is bloomberg. haidi: thank you. let's get more on the paul manafort sentence, breaking just a couple of minutes ago. we will go to the courthouse in our exam to, virginia, where our legal reporter is there with us. this sentencing of three years, 11 months, for bank and tax fraud is extraordinary lee lenient -- extraordinarily lenient. committed veryt serious crimes.

however, citing arguments made by defense counsel that similar crimes for more money have gotten far more lenient punishments than the prosecution was looking for. the judge said he had to give a sentence that was in line with those other punishments in other more serious cases, and this is the judgment that he made. anyy: the judge also banned talk of russian collusion during the trial. --do we get anything else about the investigation so do we get anything else about the investigation -- so do we get anything else about the investigation? andrew: this case was not about russian collusion. during the trial, he had made that point over and over again to the jury. he actually prevented both sides from calling anybody mentioned n oligarchal a because he thought it was prejudicial. he wanted people focused on the facts and he was concerned that

his audience know exactly what it was paul manafort was or was not being punished for. shery: paul manafort legal troubles don't seem to be over. he has another case in washington. andrew: no, they are not. he pleaded guilty after the august trial here behind me at the courthouse in alexandria, virginia. he pleaded guilty to two conspiracy counts. amy berman jackson is going to send him their next week. he faces up to 10 years max on those conspiracy counts. shery: andy harris, thank you so much, joining us from alexandria, virginia. let's now turn to europe. president mario draghi leads the european central bank and -- in a dovish policy turn. kathleen hays is here. we saw a fresh round of stimulus measures. expected? kathleen: certainly, they had a

lot of people in front of them heading in that direction. bloomberg news has spoken to officials yesterday before the ecb meeting and found out that they were definitely looking at cutting their forecast. i don't think people expected exactly what they got. it seems to put mario draghi at the head of this pack around the world. they cut their gdp forecast from 1.6%. they will do another round of targeted bank lending to help consumers, to help businesses, and they will keep their rates at record lows the aunt the end of this -- beyond the end of this year. here is the key sentence explaining why they are doing this. the persistence of uncertainties, protectionism, and vulnerabilities appears to be leading sentiment. the risks around the euro area growth outlook are still to the downside. when mario draghi explained it more in his own words, here is what he said.

youo: you just do what think is right. cucumber, however, what you are doing. ,n other words, in a dark room you don't run, but you do move. kathleen: the ecb is being forced to do more bank lending, .ore stimulus isn't that ironic? saying thesenomics new measures really don't have much stimulus. bank lending is a less favorable term. finally, bloomberg news saying some of the ecb officials they spoke to off the record are doubtful the economic outlook is as positive as the consensus. they are still worried about the downside risk. haidi: in the meantime, we saw

treasuries also waking up and rallying after the ecb comments. are we seeing global concession concerns in the air? kathleen: that is a cloud hanging over europe and germany. china' economys slowing down as well. with that, let's call up the city economic surprise indexes for a number of countries just to give you a sense of what is going on and why more people are worried, not about to much pause. maybe just a there may be rate cuts. this is an index that shows if the number of economic reports are surprising more to the positive side or more to the negative side. the u.k. is released least in that camp. emerging markets get worse. china is not so bad. theu.s., much further down list. the eurozone, the very worst on the list. we are waiting for the big u.s. jobs report tomorrow, and i think there is kind of an

asymmetric risk. we will wait for the fed to weigh in on how much more worried they are about the global slowdown in the global risk than they are about the strength of the u.s. economy. we heard what the fed governor said. justify a softer policy path. the dovish camp is certainly not getting any more dovish, but it seems like it is a long time before we are going to see any hawks flying in. haidi: kathleen hays with chinese trade data. exports -- after this of jolt. we are joined by a markham scott was a look at what to expect with these numbers. are we over the seasonality issue yet? >> we should be. there were five days of lunar new year at the start of february. much.uld not matter too we should get a fairly ok read on what is happening and it should tell us that according to

economists, it should be a 5% decline. the surprise strength we saw in january. the pmi's have given us a clue. the government pmi did not look too bad. manufacturers bouncing back a little bit. the new export orders looked pretty grim. we have a bloomberg tracker of 10 different trade gauges, which has also been deteriorating. four of those 10 are in a territory that would expect things to be heading down from here. for a probably looking fairly lackluster number today, but you never can tell, especially at the start of the year where you have these effects because of the chinese new year holidays. shery: how could the ongoing trade talks factor into the data? >> that uncertainty certainly has not been helping. it is hard to find exactly what is to blame for that weakness because we are seeing, as kathleen was saying, that

weakness in europe which is a big factor for china. you're is a massive market for chinese factories. tech downturn is certainly affecting as well. we have seen that right across the north asia supply chains with numbers out of korea, japan, taiwan. and of course china is the big elephant in that supply chain. put those three things together. the weakness in tech, the weakness in the global economy, and the uncertainty caused by the trade tensions. it is not a great environment for factories in china right now. shery: thank you so much. makem scott. -- australia's worst property slump in decades. that story coming up later in the show. how pimco is expanding its asian footprint. we will be joined by an exclusive interview with the head of the asia-pacific, next. this is bloomberg. ♪

haidi: this is "daybreak asia." i am haidi stroud-watts in sydney. shery: i have shery ahn in new york. entering the mainland could help globalize chinese bonds. the move comes as global investment banks are looking to take advantage of relaxed rules on foreign ownership in china. let's cross over to hong kong where sophie kamaruddin is with pimco's head of asia-pacific. sophie: we are here with kim stafford. welcome home. we spoke last year on the eve of the npc. we have certainly seen quite a number of measures being outlined by the chinese government to further open up the market. we have the inclusion of chinese comingn global indices up next month. how much interest are you seeing from clients? how is pimco positioning for

next month's inclusion? kim: we have seen a lot of interest from clients and it is an important market for us. one of the important catalysts was the next month in april. the bloomberg barclays indices will be including china bonds and the benchmarks. this is really important for local clients here but also for our global clients who will have structural allocation to china bonds as part of their benchmarks. been has preparing to make sure that we chinaady to trade with going forward. it is the second largest bond market in the world, having just surpassed japan. sophie: some estimates put $80 billion of inflows this year. morgan stanley says that could but to potentially $140 billion. what is the potential for that? kim: that is exactly right. about 150 billion inflows from

passive management alone. over the next four years, up to 300 alien. we -- 300 billion. sophie: to illustrate this, let's pull up the chart on the terminal that depicts this hireling income holding the record amount in december. with this access comes the transmission of volatility in to global markets. how is pimco navigating that environment? as markets open, there is definitely increased volatility as the markets get to know that liquidity and other instruments come into the market. that is not any different than we have seen elsewhere. the index providers have been thoughtful around this could bloomberg barclays is going to have a glide past into this. into this. investors will have time to find how that plays out.

sophie: how is pimco weighing credit risk as we have seen defaults rise on the mainland? kim: it is an important area of focus. you need to be selective. this is where active management is really important. istom-up credit analysis where we are focused on. you don't want to paint with a broad brush and look at chinese credit markets holistically but we do see a lot of value. more broadly, we are seeing a lot of demand for asia credit strategies. china is a large proportion of that market. we have actually launched recently strategies to take advantage of that demand. high yields in areas where we have a bought for clients. sophie: is it time to allocate towards high-yield, high-grade for china? kathleen: for the first time -- it: for the first time, looks really attractive, so

investors here want to take advantage of a home advantage to invest in local markets with strong, risk adjusted returns. they are probably under allocated to asia credit and looking to increase those allocations. australia,ning to there have been some regulatory challenges in the financial services space. several funds have exited. we have seen changes in pricing, competition heating up. has that altered the strategy for pimco in that market? kim: it caused our partners to have to take notice to regulatory changes. tople are just trying understand what this all means. we have been trying to play a role to help educate the markets adviceimportance of an with strong solutions in the local market.

sophie: australia preparing for elections. climate change policy has been a key issue. how is that fitting into the platform? kim: australia is a pioneer in est. i think the big opportunity we see from pimco is we have long seen yesterday in equity have not really seen it in fixed income space. this is an area we think we can be a trailblazer in incorporating est into fixed income, into our bottom-up credit selection. we are quite fortunate we have access to issuers to actively positived an act change and to provide transparency around reporting, so these elements we think is a little bit of a pioneer in that space and we think it will add a lot of value to markets. we want strategies and we are seeing a lot of adoption. -- adaption. sophie: how has that been getting the business off the ground? set up inffice is

taipei. we assembled a really talented team of professionals late last year, and all of this with the objective of making sure we have deeper engagement with our important distribution clients to engage directly with them, so it is going great so far, and we are really excited to engage with this important market. pimco announcing the promotion of one woman as the new managing director. going forward, what would you like to see for further bridging of the gender equality gap? kim: it is an important focus for pimco and from a broad gender perspective. when you think about investments from a cognitive diversity perspective, we are in the business of making investment decisions. to have more well-rounded better isas for multiple people better for us and women are at the top of that list. a lot of focus on how do we think about career passing, career development, stretch

assignments for women, and putting women in leadership positions. sophie: thank you so much for joining us today on international women's day. that was kim stafford for pimco. haidi. haidi: sophie kamaruddin in hong kong. thecan get a roundup of stories that you need to know to get your day going in today's edition of daybreak. bloomberg subscribers just go to dayb on their terminals. this is available in the bloomberg anywhere app. you can customize those settings with the news on the industries and assets you care about. this is bloomberg. ♪

shery: let's get a quick check of the latest business flash headlines. the hp and rio tinto are being downgraded by societe generale because of mixed macro data and subdued momentum. the bank says that picture makes further gains for my nature is

unwarranted. socgen is lowering -- also says the slowdown in china could limit the prospects for commodities. haidi: tesla has reached agreement on loans from chinese banks to build a factory in shanghai. they will team up to offer the money in a series of loans. the banks are offering the equivalent of $521 million back in january. elon musk the tesla would need $500 million to build a plant. shery: it would combine the third and fourth largest u.s. wireless providers. the deal has drawn criticism for potentially reducing competition . the merger still needs approval from the sec and antitrust regulators -- fcc and antitrust regulators.

coming up next, huawei versus the united states. china's biggest front own -- smartphone maker fights back. this is bloomberg. ♪

ed: "daybreak asia this is." -- this is "daybreak asia." paul manafort has been given a must than four years in prison. the judge called a recommendation for 19 to 24 years excessive. metaphor could get another decade in prison when he sentences him next week on conspiracy charges related to secret lobbying in the ukraine. larry is a self-confessed critic of modern monetary theory, saying it is "garbage and deficits matter." because the u.s. borrows its own

money, it can simply print cash to cover its obligations. the u.s. deficit is on track to top -- larry think says it is not a good approach. >> that is garbage. >> you are with jay powell on that one? helpising taxes does not modern economic growth, and more importantly, yes, i am a big believer that deficits do matter. i am a big believer that deficits are going to be driving andrest rates much higher it could drive it to an unsustainable level. ed: south korea's intelligence agency says the north has resumed work at a long-range missile site with operations possibly beginning before the hanoi summit took place. worklite images indicate began sometime between february 16 and march 2. dismantling the site was among

steps promised by kim jong-un last year after he met president trump in singapore. party says it's candidate for prime minister has been disbanded. the constitutional court says he broke political rules. endedief political career when the king publicly denounced the move as inappropriate. an exileded to person. global news, 24 hours a day, on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am ed ludlow. this is bloomberg. shery: let's get straight to the market -- can -- market action with sophie kamaruddin. sophie: asian stocks are under pressure, headed for a second week of losses. the ecb adding to those woes. bonds rallying. a big pickup in korean notes

with the yield dropping nearly 10 basis points. continuesin debt across bond markets. when it comes to the equity space, the nikkei 225 leading losses in asia, off by .9%, falling for a fourth straight day. in seoul, we are seeing a sixth consecutive session of losses for the kospi. hsbc urging caution around korean equities, saying they are among the most overvalued markets and lowering korea to underweight. in sydney, aussie shares retreating from a six-month high . the asx 200 off by .6%. flipping the board to check in on some stock movers across the region, i want to highlight, want to highlight this company. it is down by 9% after widening its full-year loss. it is hoping to boost its capital base. the guidance was whiter than the average analyst estimate when it came to that loss.

something as much as 7.1%. this as dividends missed market expectations on falling refining measures. we also have kakao on the radar, 2.4%. it is seeking to list shares in south korea. sophie kamaruddin. let's turn back to the breaking story at the top of the hour. forencing for paul manafort less than four years. federaleak to a former prosecutor. great to have you. is not just less than what the prosecution was guiding the sentencing to be, which is to 24 years,years but it is less than what the defense was asking for, which is as much as over five years.

is this unusual to you, to put it mildly? >> it is not unusual. this judge was not very favorable to the government during manafort's trial. and when the prosecutors asked for 19 years, that was a pipe is not a this surprising sentence. the key for manafort is what is , becausecome next week he has a second sentencing on the horizon, and a key issue when you have two different paces is will the second judge give him credit for the sentence in the first case? a longld hit him with sentence and say you are going to have to serve your first sentence, and then you are going to do the second sentence. an interesting question when he faces the court in washington, d.c. shery: that judge has been a bit more critical whereas judge llis has been making

ofarks like he has done lots good things. do you think it is likely that the second sentencing is likely to be one that will be consecutive rather than concurrent? >> i think it will depend on how washington assesses his cooperation. if she decides that he is a liar, and she has already said he is, then you could well see a consecutive sentence, although i would not expect it to be a 10 year sentence, but it could be a five-year sentence, which would mean he would serve about the in asix or seven years federal correctional institution here in the united states. to give credit for the time he has already served. he could be looking at five to seven years in prison. shery: he banned any talk of russian collusion during the trial, but the reason we care is because of mr. manafort's links to special counsel mueller.

30 peopleen more than being indicted by the special counsel. do you get any sense of where we are at in that investigation? peter: i think mr. mueller is looking at an in game -- endgmae -- here. here -- looking at an endgame here. that is a sign you want to get this finished. robert mueller is famous for pushing things through quickly. i would not be surprised if in the next few weeks we were to get a final report. maybe there will be a couple more indictments, but i rather doubt it. i think we are at the end of the indictments and instead, we will be looking at his report. shery: another legal drama unfolding not only here in the united states, but also in canada.

huawei is suing both the u.s. government and canadian government and police. we are seeing this global offensive. they are suing the government for banning the use of the equipment by federal agencies. peter: it's a tough case for them to make. the claims that they are making, really, federal judges tend defer on tend to issues of national security. about the only argument that might get some traction i think would be their claim that they were denied to process. but the federal government does not have to do business with a company. it can choose to exclude a company if it wants, and frankly, even if huawei were to does anyone in, the united states want to touch huawei? they have come to the point

where they are almost toxic. even if they win the lawsuit, i am not sure what they will get out of it. the lack of fair trial goes to the bill of attainder. can you explain what that concept is usually used for? iser: the bill of attainder when congress passes a law that designates someone as a criminal and it poses a punishment on them. the claim is that by excluding zte corporation, that in itself is a punishment. is, typically, punishment are sending someone onprison or imposing a fine them. there is an open question as to whether it corporation -- a corporation can even claim the protection applies to them. corporations have rights in the united states, but certainly not

every right and not every constitutional right. and institutional question will be whether they can even make out that this is a bill of attainder. another argument is this violates separation of powers. that is an argument that really gets any traction in a federal court. shery: this seems like a beenlic offensive that has intensified by huawei. would it surprise you if we saw more legal offensives being mounted elsewhere perhaps across other jurisdictions? peter: we have already seen the challenge in canada to the extradition of huawei's cfo and i think she may have a better chance by raising issues about how she was interviewed by the police when she was initially detained in canada? ultimately, the united states and canada typically will exchange prisoners, so i do not know if there is a very good

chance that she will be able to avoid extradition to the united states, which means she is gorgeous face a trial in brooklyn sometime in the next couldr so, and that case carry some very significant penalties. bank fraud is punishable by up to 30 years in prison, so i think there is a real risk for her if she ends up being extradited into the united states. shery: professor, thank you so much for joining us. peter henning. coming up next, we speak to dbs group's institutional banking head about their outlook for asia. this is bloomberg. ♪

shery: president says trade talks with china are moving along. our next guest says the deal could potentially benefit the asean region.

joining us is the cbs group head of institutional banking. how much of this optimism has already been baked in by investors in the broader markets? the markets have definitely factored in, you know, a trade deal. the trade war is morphing into a technology war. wilst -- whilst that is being sorted, companies start to look intraregional trade. i think there will be a pivot oft is a diversification risk and a pivot towards coming into the asean high-growth and high-density and young demographic countries, so this

is not all bad for asia. shery: how long and how easy would it be to achieve that structural shift away from china? i do not think it is a structural shift away from china. i think it is still a china story, a greater bay area story. chinese companies, for example, who want to reach out to high-growth asian markets will be looking at india, indonesia, vietnam, philippines for example. we have been beginning to see some signs for that. we will start to also look to what is in the aussie on region -- asean region. it is a long-term shift. the interest and connectivity pipes being built. haidi: how do you rate the competitiveness of singapore in the perennial fight?

hong kong and beijing are making greater strides. is that a threat to singapore? know, i do not think you can find hong kong's geographic proximity to china. the greater bay area is going to be a significant boost for that part of china. particularly optimistic about the gba. singapore was small. we are in the midst of south and southeast asia. we are building a smart city. and creating a digital smart city here within itself. each city and each financial hub will find its own space in the new world order. >> it is international women's day.

in terms of the competitiveness on gender equality we are seeing across asia, i am wondering when you expect that we will see a female head of a major bank or financial institution given that according to some rankings places like singapore, indonesia, thailand are ranked behind the likes over wanda in -- rwanda in gender equality in the workplace? tan: we may have been a little bit slower and putting more females on board here, but direction is pivoting to the right one. happy to figure that 40% of our staff are women. that, i think more at the regional level. mentorship,

opportunities, and family-friendly policies. some companies are ahead of the gain. some companies have to catch up. >> if you have one thing you would like to encourage, what ?ould it be tan: if i had one thing to say, , a malere a male leader champion for women talent, if you are a male leader and you female a good, young talent, encourage them, mentor them, and bring them up, and give them the encouragement they need. haidi: what do you think is the biggest challenge for making whiler progress acknowledge and that a lot of progress has been made already? that a lot ofng progress has been made already? tan: technology is moving at an

exponential rate. the future leader has to be adaptable and be able to unlearn what they already know to survive this fourth industrial evolution. women leaders can be adaptable, flexible, and can be humble. i think if more can be done to encourage future women leaders, you know, especially in this new digital economy. i think a lot of people will benefit from that. >> such a pleasure having you on with us on international women's day. dbs group head of institutional in singapore.g us you can check out that conversation and anything else you might have missed on our interactive tv function at tv . you can watch us live and dive into any of the securities or bloomberg functions we talk about. you can also join in on the conversation. you can send us instant messages during our show. this is for bloomberg subscribers only. do check it out.

it is at tv . this is bloomberg. ♪

the 24ceo is one of female leaders of fortune 500 companies. she spoke to rumored about the challenge of being a female executive and how her company has managed to cultivating a leadership. >> it is not easy -- cultivate female leadership. >> it is not easy.

my advice to my fellow friends and sisters is don't give up. in terms of lesson learned for china,s operators, yum we are very lucky. we have very good leaders for many generations to get to this stage in which 60% of us are women. among 450,000 staff. in terms of leaders, half of us are women. we are very lucky. we have certainly done something i believe right to come to this stage. the two things at least. one is meritocracy. whenever women are in the system that emphasizes meritocracy, we will not do too badly. have ay, is to

transparent promotion process. >> i think it is very interesting that as a female led company, you have 50% of your leaders as female as well. it is almost as if it reached" although i don't think you have a quota. it is a natural -- as if it reached a quota, although i don't think you have a quota. it is natural. that is a good situation because no model does help. and also, there are certain .hings that also help it is very subtle. sometimes, the bias runs very deep. we need something a bit -- to help improve the situation. his work life balance an issue for you as a female leader? joey: always, for female or male

, for all leaders. it is always a challenge. the key thing is i am very lucky i have a very amazing husband who is willing to share the housework, the childcare. . think that is very critical and then, the other thing is just keep learning. i am a mom as well. being a working mom, by far, i think it is the biggest challenge of life, even more challenging than being a ceo. i will just keep learning. shery: joey wat speaking exclusively to rachel chang. on this international women's day, there is one really interesting survey by ubs showing that 59% of millennial actually pass on their financial and investing decisions to their spouses. take a look at these countries. you can see 73% of millennial

efer ton singapore dfe decisions.financial 56 in the u.s., and 49% in brazil. when it comes to household financials, we defer it to spouses. haidi: i found it really interesting that our generation are more likely to defer those financial decisions to our spouses, which is really surprising. you can see taking a look at this graphic just the breakdown where you are seeing the proportion of women leading those decisions, their spouses making those decisions, and where it is shared. mexico actually, a great deal of those decisions are actually shared. really interesting, looks like. millennial women need to take charge of the purse strings a little bit more. more disappointing news for

tata motors. it fell 4% to just over 38,000 cars. deliveries of jaguar's and sales rose almost 6% but the unit was dragged by declines of 8%. glr says its performance has been badly hurt by china where sales slumped. shery: ing has reduced its bonus pool after a year hit by a record money laundering settlement and public discontent over bankrate. they paid out over 303 million for 2018, downs from 403 million euros the year before. ing said it would scrap the bonus for the ceo because of the money laundering settlement. haidi: let's get a preview of what to watch as the chinese markets prepared to come online. sophie: first off, in taiwan, we are watching reaction to reports

that tech firms asked suppliers to shift away from china. customers include dell, hp, and ibm. quantum computer shifted manufacturing to elsewhere. it surprised data centers to the likes of google and facebook. we are keeping an eye on chinese agriculture related stocks. that could spur some optimism that china may return. we are waiting on chinese trade figures later this morning. growth is seen easing in february. that is it from "daybreak asia." more markets coverage continuing with the look ahead. this is bloomberg. ♪

>> it is 9:00 a.m. in beijing, shanghai, and singapore. welcome to "bloomberg markets: china open." i'm tom mackenzie. yvonne: i'm yvonne man. we are counting on the open's for the markets. here's the top story. a wall street slide extends to asia amid rising concerns about growth. institutions around the world are cutting forecasts. >> investors further spooked by grim news from europe. the user -- the euro sank as yvonne:aghi lowered projections and offered more stimulus. the picture could further darken after we see trade data from china. exports falling after january's surprise gains.