paul: we are under an hour away from the australian market open. shery: welcome to "bloomberg daybreak: asia." our top stories this thursday -- asian stocks face another tough date as the global selloff rolls on. investors question whether a trade deal will be a great. negotiations are said to resume. ifna says it will retaliate

president trump follows through with his tariff threat. disney tops earnings this quarter. shery: a quick check of how markets closed in the wednesday session. the s&p 500 fell for a third consecutive session, down 2/10 of 1%. communications sector leading the decline. communication has been one of the leaders in the recent rally. finishinge dow ascensio unchanged. investor sentiment has been pretty fragile. we have seen the markets hit by trade tensions and concerns over trade. initial optimism from the white house over an initial trade deal, but at the same time we heard from china they are planning to retaliate if the u.s. goes ahead with the hike and tariff. that hit sentiment, volatilities surged, and the vix below the

volatility level. u.s. futures under a little bit of pressure. let's see how we are setting up for asia. paul: a certain degree of uncertainty. the next -- a mixed picture in the asia-pacific. india calm, trading for under an hour . futures in australia are pointing higher, 1/5 of 1%. different story as we head few further to the west, nikkei futures down and seoul down one third of 1%. let's get the first word news. here'ss su keenan. su: the house judiciary committee is holding attorney general william barr in contempt of congress for failing to comply with a subpoena for the redacted mueller report. the vote escalates the clash

with the trump administration, who is refusing demands for documents and testimony. president trump is exerting executive privilege over the council's full report. u.s. secretary of state mike pompeo meanwhile has criticized the u.k., warning the government not to go wobbly. his words on national security in china. that is a hurry up and deliver brexit. his words come just a month before president trump is due in london for a state visit. secretary pompeo argued what the so-called iron lady margaret thatcher would do if china was trying to boost its global influence. >> the united states and u.k. cooperate a great deal on security in asia as well. that cooperation will be more necessary as china tries to shift the global balance of power in its favor. huawei ceo held in

vancouver says her constitutional rights were denied. her legal team says her detention amounted to an abuse of profit. the teams has comments by president trump abdicates political interference. she and huawei are accused by the u.s. over fraud charges and dealings with iran, and she is fighting washington's demands for extradition. global news 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm su keenan. this is bloomberg. shery: the u.s. and china are sending mixed signals over trade, with president trump exposing optimism over a deal, and beijing warning it will retaliate if he follows through on his threat of tariffs. let's speak to our bloomberg editor and china correspondent.

there have been conflicting signals from the white house and beijing. what have we been hearing from the u.s.? >> there is a bit of gamesmanship by both sides. he u.s. -- donald trump said believes the chinese delegation is coming to washington thursday local time, looking to make a deal, this after some tough talk about raising tariff s. they are planning to kick those additional tariffs in as of the first part of the day friday. the chinese effort to retaliate if that takes place. -- have threatened to retaliate if that takes place. there will be an opportunity for both sides to dial back a bit, but this is all leading to what is supposed to be the final round of negotiations. it could just blowup and come without any sort of agreement. paul: tom, you heard joe talking

about the threat of potential retaliation from china. what do we know about china's intentions heading into the stocks? tom: china is trying to portray itself as the rational actor, but also will not buckle under western pressure. liu he will be in washington. comments from the commerce minister saying the friend actions from the u.s. are -- the threatened actions from the u.s. are regrettable, but they are planning counter actions. china says it will impose counter tariffs after the u.s. imposes its tariffs. likefs largely on things agricultural products, but an easy lever for them to pull would be on the u.s. autos, because they have suspended auto tariffs 25%.

they could end that. they are looking to get a resolution. the question is whether they will get enough to satisfy the u.s.. shery: once we see those tariffe d products in the u.s., it could become more expensive. do we know which imports from china be -- could be in the crosshairs? tom: initially you have the $200 billion worth of tariffs, imposed at a level of 10%. they will rise to 1025% -- to 25% if the u.s. follows through. things like computer equipment, telecoms equipment, circuit boards, things like wooden furniture, car parts, intermediary parts put together in the u.s.. there are potential concerns about cost for some of those u.s. companies. trump has threatened to impose tariff on all chinese goods i

-- it is less than $300 billion. that will take us into new territory, things like smartphones. 5ell phones valued at $44 billion u.s.. things like laptops, big-screen tv's, printers -- if trump went ahead with that, that would have an impact on china's gdp. if alld shave off 1.5% chinese exports are tariffed. paul: president trump has also taken action on iran. what is the action there? >> the u.s. put new penalties on metal goods from iran. this is an increasing economic squeeze on the iranian government. the u.s. is also taking some military steps and a task force

into the area. the end game is -- apparently a renegotiation or a better deal of the nuclear accord negotiated by the obama administration, along with the rest of the so-called p5 plus germany and the yuan -- and the u.n. the u.s. has not stated what they want. they want iran to stop its support of groups in the middle east. that is the main goal for the u.s., to cut back funding for groups which the west considers terrorists, and meddling in the affairs of other countries in the region, particularly iraq, but also in syria in its attempts to form and trouble with -- to foment trouble with

israel. paul: thanks very much to both of you for joining us. coming up next, we will find out andthe ecb says the peak bond yields is a real short-term concern. shery: we will be live at the j.p. morgan china summit in beijing. our correspondent stephen engle is there. two in the final day of the j.p. morgan global summit. we had gp donning exclusively here -- gp diamond exclusively here. we will follow that up with a number of interviews. up on a lot of the issues we covered with jamie dimon. the property magnet out of hong on chairman will be

on later as well. we will talk movies, and the chances of asian film houses of breaking through the so-called bamboo ceiling for asian themed films in the u.s.. the ceo will be joining us much later this morning. a packed today in beijing at the j.p. morgan global china summit. this is bloomberg. ♪

shery: let's talk about one demand of the 10 year treasury sale, concerns trade talks could go off the rails, or was china firing a shot off the u.s. bow? kathleen hays is here. this is a popular bond for foreign and domestic investors. what happened today?

kathleen: someone did not buy the way you would think they would buy the 10-year note. this is the most popular for u.s. investors. if any is going to be strong, this is the one. a very to cover ratio, important measure of demand, fell to 2.17%, the lowest in 10 years. jump into the bloomberg library with me. bid to cover, the amount of treasuries offered relative to the amount of bids they get, the lowest in a decade. at the depths of the financial crisis, here we are in 2019 may, a big difference. why did people jump to the conclusion the chinese did not buy as much? trade war tensions this week of escalated. maybe the chinese are trying to flex their muscles, that is what people are thinking. you can get away from this notion if you look at the

bloomberg terminal. you can see what is happening and eight shorter timeframe much better. -- in a shorter timeframe much better. this includes international and monetary authorities. it went down from 70% to 50% of the bid. the chinese are buying less. look at the direct bidders. the green bar did not move very much. that is where china is considered to be one of the biggest buyers. saying the chinese did not do anything at all -- very important to say about the chinese, the owe $1.1 trillion worth of treasuries. how much does that you must own -- the u.s. own? $22 trillion. own as much as they want and still not disrupt the market, that is what people are

saying. you are selling too many bonds, maybe it is hard for traders to take it down and it could it worse. two here on the coupon was the lowest in a year. i think it has people watching these auctions more closely. shery: great that you put it into context. you just have to zoom out a bit. let's get more insight into these volatile markets with our next guest, chief strategist and assetf cros allocations -- we heard from kathleen about 10. tepid reception for the should we wait and see what happens if we do get the 30 year supply on thursday as well? >> i think the auction in itself was a just, -- was interesting,

but i don't think that is the main concern right now. the u.s. 10 year bond yield trading below 2.5% indicates there is a concern for long bonds of a relatively safe nature. the concern now is in spite of stimulus and attempts to reinvigorate global growth, we can't seem to get any traction in the bond market toward a stable yield curve. that i think is a bigger concern when you look from a macroeconomic perspective. shery: there seems to have been this peak in bond yields. what does this signal for the rest of the markets, whether it is the equity rally we have got so far? thomas: i think that is the interesting point here. there is a lot of discussion about an inverted yield curve. if you look at the past, an inverted yield curve is not an imminent running signal for the economy. when you look at when bond

yields started falling, it was an indication they were close to the peak in the economic cycle, and that is when you are also close to stock prices. we have seen stock prices going up, but if you can't translate that into rising bond yields, there seems to be some disagreement inside markets. i think that is bigger concern now. we are not seeing signs markets are buying into a story of bigger growth. we see some attempts from central banks and governments to get a different outcome. i am a bit concerned something is not looking right from a global growth perspective. paul: so thomas, how long do you think this long run has left to go, -- this bull run has left to go? what will bring it to end? thomas: when the economy is

in ag slowly meaningful way. i don't think you see that the moment. it is not a game changer from a macroeconomic perspective. this is about catching the market at a certain time when they are not willing to see any uncertainty introduced. if you look at the past cycles, three or four months after the peak in bond yields, if that is what we are seeing, we are close to the peak in stock prices and we should look for signs over the summer that growth is slowing. i think the big uncertainty --that is the big uncertainty right now. if you can drive bond yields higher, that will be the conclusion that the stock market and economy has already had its run this year. paul: has the market becomes complacent with regards to the

u.s. china trade deal? thomas: the equity market has generally been picking up the compression of relativity, driven by positive signals coming from central banks. you look at the positioning of volatility markets going into this week, we were seeing signs the market was as stressed as it was last year when volatility became the driving force between -- driving force behind stock market movements. this was not a warning in its south, but a sign that everything would remain under wraps. regardless of what you think about the trade war itself, it is pretty clear uncertainty was introduced, a deal many investors had assumed was already given. that seemed to crack up. i think that is the main short-term concern. for a long-term study of, it is

about the long-term macro economy and not short-term signals itself. what we are looking for is evident of a positive effect coming, particularly out of china -- this does not seem to be materializing. the numbers do not look as strong as they should if the stimulus was actually working. once the dust settles on trade discussions, markets will resettle on the economic signals. seb chief strategist and head of cross asset allocation. you can get a roundup of the stories you need to get your day going in your addition of daybreak. our sources are available on mobile on the bloomberg anywhere app. you can customize your settings

so you only get news on the industries and assets you care about. this is bloomberg. ♪

paul: walt disney rose in late trade after earnings beat estimates. profits fell 13% in the second quarter, but analysts expected a deeper drop after its expensive move into digital technology. what drove the good results? >> theme parks did well, and disney's former growth business, the cable tv business with espn did better than analysts expected. that is always what disney has been able to pull off, it has these diversified businesses. one thing is not doing so well, another picks up. shery: the company has been spending a lot on streaming. when can we expect to see those

results? chris: the stock market has already applauded this move. it will be up in trading tomorrow. they are changing from a company with value-based on earnings to one based on what will happen to subscribers, sort of like netflix. in terms of profits, almost a $400 million loss in the streaming business this quarter. they indicated the streaming businesses, disney plus, hulu, may take until 2024 to be profitable. paul: did we get any news about disney's asia business? chris: the theme parks in asia continued to do well. they are making investment in tokyo. the hong kong park did well due in part to new attractions. the shanghai park attendance was down. they say they will continue to make investments there. they noted "avengers: endgame,"

on its way to be the top grossing film in history, $600 million alone in china, a huge number. shery: let's get a quick check of the latest business headlines. a swiss pharma giant is paying almost $3.5 billion up front to buy drugs from a japanese drugmaker. the deal comes with nearly $2 billion in further milestone payments. takeda plans to use the money to cut debt and deleveraging. paul: amazon says it was hit by an extensive fraud, with hackers tapping funds from merchant accounts last year. it believes hackers broke into 100 seller profiles and funneled cash from loans or sales into their own bank accounts. amazon says the hackers changed account details on the seller

central platform used by merchants to market their products. shery: intel slumped after the new ceo's forecast rose stalled in the long-term. last month intel says sales will fall this year, and it lowered projections for revenue in the current quarter. sales of data centric products will expand, but not enough to offset sluggish pc demand. speaking at his first investor event as ceo, he admit he let investors down. paul: greater indonesia is defending its accounting amid regulator investigations into last year's numbers. one area of inquiry was $200 million of revenue the airline booked from a startup tech company to provide in-flight entertainment and internet connectivity on planes. a reported net income of $100 million last year compared with a loss in 2017. coming up next, we are going to

the jp morgan summit invasion. s china be speaking to it ceo about its push into the financial sector. this is bloomberg. ♪

su: this is "bloomberg daybreak: asia." we start with the u.s., which confirmed it will increase tariffs on $200 billion worth of chinese imports, from 10% to 25% on friday. the higher tariffs has been made official from a filing from a trade representative in the official federal register and will take effect one minute after midday beijing time. china says the move is deeply regrettable and it will have to retaliate. meanwhile the trump administration imposing sanctions on iran's metal

sector. the ban on the purchase of iranian steel and copper is designed to prevent iran from raising funds for nuclear weapons and ballistic missiles. earlier iran said it would thedon limits agreed to in p5 deal -- to saudi arabia, which is planning to meet all requests for deliveries of oil it received for the month of june, including countries forced to stop buying iranian crude because of the u.s. sanctions. sources the kingdom say production will remain below the saudi agreed ceiling. and told exports will be less than 7 million barrels a day next month. china and india have been the lehman buyers of iranian oil. --leading buyers of iranian oil. drivers from uber and lyft turned off their apps in protest

of what they claim are falling wages at a time when companies are launching ipo's and raking in billions of investors. demonstrations happened in 10 cities, including new york, chicago and l.a. the protest comes ahead of uber's ipl on friday, which may value the company at $90 billion. the latest on south africa's election. accounting is underway, with opinion polls pointing to the ruling national effort not -- african national congress extending its rule. a convincing majority is needed to push through economic reform in the face of opposition from its own party. a narrow victory could hamper his efforts to restructure state owned companies and root out corruption. global news 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries.

paul: thanks very much for that, su. let's check in on asian markets. new zealand up and running. not much action, higher by a few points. asx futures higher 1/5 of 1%. that despite another roller coaster ride on u.s. markets. shery: no wonder we are seeing futures for japan and south korea under pressure at the moment. the japanese much stronger, at the 110 level. we have seen incredible haven strength for the japanese yen all week, holding around 110. kospi futures down 2/10 of 1%. we are into the second day of this year's jp morgan global china summit invasion. let's cross -- summit in beijing. let's cross over to stephen engle with the man who oversees

their china operations. stephen: mark leung is getting the marching orders, and he is our guest. and so much for joining us. take marching orders coming from jamie dimon as well because of all of the mentions you are seeking approvalsfor, licenses for. we don't want to call it a jv, a majority ownership. we know jamie does not like the term jv, because you want more control. can you shed more light on what is next? the asia-pacific banking head said it should be licensed by the end of this year. mark: that is what we are expecting. we have been working diligently to get prepared for approval is granted. we feel excited about the

opportunity. it is a response to our impending need to serve our clients onshore and across our borders. we have finished our hiring. 80% of our hiring is done and we have key candidates identified. we should be in a good place to get ourselves ready for inspection and hopefully licensing before the end of the year, getting to business and helping clients. stephen: can you shed more light on the executive team makeup? how many we are talking about, etc.? mark: in total, it is all of the regulation side. we are not just stopping at that . we have more than 100 plus people working on this particular entity. i think it is a whole peripheral banking,thanking, on -- onshore banking, and making sure the whole ecosystem of investment works cohesively together. we are excited about that additional piece.

byphen: are you concerned possible retaliation by the chinese if the trade deal goes south, as it seems to be? mark: it is an evolving topic. i a lot of speakers have spoken about it. fx markets have told us what they want. for capital, a collaborative dialogue based restorative solution. as a risk management, we need to be ready for all scenarios. one thing, we do this because it is a long-term goal. we need to serve clients. that request to have us helping clients on the ground and across the borders has only increased. we don't think this will change we think it is important we be the fair weather friend in difficult moments to help clients. stephen: there was also news

yesterday about the mutual fund jv. we know yesterday j.p. morgan has talked about wanting majority of control of that as well. you have a partnership with shanghai international trust. you have 49%. we heard yesterday shanghai trust will put 2% up for sale. markets don't you perhaps would -- thought you perhaps would buy up that 2%. mark: you those stages we have the desire to increase our majority, subject to regulatory approval, of 100%. we have working with our partners collaboratively for a while. you have seen the regulations. we would update you when we have further details. stephen: could you shed light on how much progress you got with regulators? i believe you went there with

jamie dimon as late as yesterday. mark: yes -- i would be glad to say it was a very collaborative discussion. it was consistent with all of the meetings we had in public, with the industries and ourselves across our investment. client and activities the plan to open for the country will not change and likely only accelerate. what we have seen up to this week has been consistent that. stephen: have they given any indication the desire to follow through on their pledges have changed? mark: i don't see that trace. from what i experienced, the determination for china to open up its sectors and embrace global investors in capital markets will remain, sustain and likely accelerate. that remains our goal. our clients have been involved with us to ensure we put forth

the right support. i think it is a matter of making sure we are there for our clients, hopefully a little ahead of demand. stephen: how do you see the risk in the chinese economy now, particularly the banking and credit risk? we have seen in bloomberg data the prospect of defaults more than tripling the same amount last year. last year saw a huge surge in the number of corporate bond defaults. where are you seeing the biggest risks right now in the credit space, in the bond market? mark: i think it is not a bad development to see more credit events. good thing toa see we are addressing monetary quality. it is a good direction, but of course when we go from where we want to -- where we are to where we want to be, investors

are very closely watching how this affects the ecosystem and to prevent any contingent. i think that is the right way to evolve the market, and we are supportive of more market-driven pricing and transfer of credit. we are working with our clients onshore and offshore to participate in the fixed income market, in the financing market. stephen: do you expect authorities to continue to none len --continue to nudge lenders sector?s to the public at times there is a slowing economy, and a trade dispute with the united states that perhaps adds uncertainty. they are trying to mop up the shadow banking sector. that adds much needed liquidity, but adds to the risk. mark: i think liquidity

injection has been consistent on operations. i think it is very heavily managed to perfection so far. i hope the equivalent will stay. i hope providing the right level of credit to the private sector is not only important, but the new rules provide an equity financing channel, which by and boege is how many of the po financing is important. i think the situation changes where the registration system, allows more flexibility in emerging industries, or very good development that we and our clients are hopeful for. that provide the platform for financing. ultimately we are working hard with the country in which leaders to bring more institutional investing. that ultimately is where i think

the bigger concern i have -- the market is relatively retail driven. institutionalre they are more, short in hedging, that could provide a buffer. it could be a more evolved market. stephen: thank you for being with us at the j.p. morgan global china summit. paul: that was jpmorgan chase china ceo mark leung in conversation with stephen engle. we have another guest from the jp morgan summit in the next hour, the beijing founder and ceo will be on it 8:10 hong kong. coming up next, more profit warnings from japan's auto sector. we will look at what toyota and honda are doing to compete in a tougher market. this is bloomberg. ♪

paul: the u.s. china trade spat is hurting japanese automakers with toyota and honda having sales fall below estimates. joining this is macquarrie capital head of asian auto research. i want your key takeaways from the results of toyota and honda. toyota,nk the key for they have given us more details on how profitable their china business is. what they have discloses only the tip of the iceberg, because they have made a lot of money in japan through lexus and royalties. toyota's reason focus of extending their china business is something we should feel positively. in the case of honda, the numbers were somewhat disappointing. it was coming primarily from the

motorcycle business, where there has been a marked slowdown in the indian market. when we look at honda's two wheeler business, they are gaining share globally, but we are seeing pressure on sales in a number of emerging markets. that was perhaps the weakest area of their earnings. paul: we do hear a lot about the pressures on the japanese carmakers. if you look at toyota, 15 buys, eight holds, zero sells from our analyst rating. what does this tell about the long-term optimism about the industry? janet: there are a few things. firstly, when you look at toyota, they have a 2.8% operating margin, which is tops in the world among mass automakers. they have a strong balance sheets, so they are able to invest heavily in new technologies of the future. when we think about connections autonomous -- connected, electric,, shared and

they are able to go in all areas going forward because of their deep pockets, and they have woven together a relationship of companies, uber, grab, etc.. we look at toyota and see this as a company that can be successful going forward. they have 100 million cars on the road which can gather potential information for them, and very happy customers. number one in satisfaction for consumers in the u.s. market. we think this will support their longer-term future, even as they at the sense of crisis changes taking place in the industry. shery: how big will china be a dynamic given we could see higher tariffs on u.s. made cars? janet: in the case of china for tioga, at the margin -- for

, at the margin they benefit from u.s. tariffs. their competitors, daimler and bmw suffered on suv exports, whereas toyota brings their suvs from japan. the more important opportunity in china will remain local production. that is why we are seeing china ramp things up with its two joint venture partners. they have been holding off relatively compared with honda, which has number one share among japanese brands. we are seeing toyota put on the accelerator there. i think you will see china becoming a much bigger part of the toyota vision of the future. shery: talking about partnering up, they are working with panasonic on that joint venture when it comes to the making of ev batteries. how significant will this business be? janet: i think in the long-term

it could be extremely significant. in near-term, toyota says it will remain focused on the hybrid vehicles. clearly in the longer term future depends on pure battery ev's, and solid-state battery technology particular. toyota, 49%s 51% panasonic highlights that toyota is bringing significant technology, but relies on panasonic's ability to produce these batteries in a cost-efficient manner. that will lead to the hockey stick moment in electric vehicles, being able to produce affordable vehicles and just as reliable as toyota's current products. paul: coming up on the calendar next week, we have nissan earnings. the difficulties have been well-publicized. what are your expectations? janet: they came out with a

profit warning just before the golden week holiday. i think expectations have been reset. the critical challenge for these on is how they improve -- for nissan is how they improve their brand image. whenis something where, you look at their key japanese competitors, they have not performed nearly as well as toyota, honda, and subaru in terms of brand perception as measured by surveys like consumer reports. number one, they have new models coming out in the next two to three years. that is not been you can fix overnight. it will take them several years to fix. in the meantime, they are still doing relatively well in china. we expect that will be something that helps to offset softness in the u.s.. overall compared to honda and toyota, it does not look as

good. shery: thank you for your insight, janet lewis, macquarrie capital securities head of asian auto research. if you missed any part of the yourrsation, tv is function on the bloomberg. dive into any of the securities or functions we talk about. be part of the conversation. send us instant messages during our shows. this is for the brook subscribers only. check it out at tv . this is bloomberg. ♪

shery: let's get a quick check of the business flash headlines. tata steel says any failure from the u.s. and china to strike a deal threatens their demand on metal and reduces manufacturing on the mainland. tata warns steel orders will slump i there iss -- if there

is no agreement in washington this week. a $1 beijing has signed billion deal to build a natural gas plants in iraq. china petroleum engineering and construction will carry out the work, which will take 2.5 years to complete and be able to refine 2 million standard cubic feet of gas every day. iraq will use the plans to reduce its reliance on gas from iran. shery: as uber prepares for its giant ipo this week, no one has more at stake than softbank. let's look at this with our bloomberg tech reporter. softbank is uber's largest shareholder, but at the same time has a bet of $18 billion on the sector with three similar startups. how big of a deal is this for softbank? >> it is a huge deal for softbank.

in the more immediate term, when softbank was investing uber just a year ago, there were a lot of doctors -- of doubters on the valuation. this ipo will provide a proof point for the vision fund as a whole. $18 billion, most of it in the vision fund, is in ride-hailing companies. reportay an excellent from an analyst in asia, sketched out what it might mean in the future. it is a positive outlook from his point of view. he sees the ride-hailing stakes already worth $9 million more than what is on pace. the true potential from their point of view is the future, and with the arrival of robot taxis, the numbers he forecasts in 12 years, the stakes 90 as much as $430 billion, which is

astronomical. a revolution it as on the scale of the end of the horse and cart era. what can we expect from softbank group earnings, which will be out later today? >> the attention will be on uber. final pricing will come in just at the same time softbank reports earnings. these days no one looks at the quarterly earning results. with uber happening in the background, there are questions about the ipo later this year. haveyear certainly will fairly large ones -- people want to know whether these process from the vision fund will go on, and would like to hear commitments to that extent. shery: will we hear any commitments on closing the valuation gap as well? pavel: i am sure he would love to talk about it for an hour or

two. he gave a good 45 minutes at the last, so it would be hard to beat that. paul: bloomberg's technology reporter in tokyo, thanks for joining us. let's get a check on asian markets. new zealand has been looking flat since trading began, currently higher by 1/5 of 1%. sydni futures on the recent. they were pointing higher by 1/5 of 1%, now turned flat after the weak lead-in we had from the u.s.. shery: futures decelerating for the nikkei, down 4/10 of 1%. similar picture for cost be futures. these markets have taken a hit after coming back from their respective holiday breaks, with the topics wiping out $156 billion of value. we will have plenty more coming up on the next hour of "bloomberg daybreak: asia." more on the outlook for china as

well. the market open is next. this is bloomberg. ♪

at comcast, we didn't build the nation's largest gig-speed network just to make businesses run faster. we built it to help them go beyond. because beyond risk... welcome to the neighborhood, guys. there is reward. ♪ ♪ beyond work and life... who else could he be? there is the moment. beyond technology... there is human ingenuity. ♪ ♪ every day, comcast business is helping businesses go beyond the expected, to do the extraordinary. take your business beyond. paul: good morning, asia's major

markets have opened for trade. welcome to "daybreak: asia." paul: asian stocks face another tough day as the global selloff rolls on. investors question whether a trade deal will be agreed. wednesday.s resume

china warns of retail -- of retaliation if the u.s. hikes tariffs. sanctions onposing metals to stop iran from building nuclear weapons. let's -- we're seeing japan, south korea, and austria getting underway. we have seen asian stocks take a hit for the last three sessions with global stocks losing one point $4 trillion in just the last two days. we are seeing the nikkei falling .4 of 1% and the topix losing .6 of 1%. the longest golden week holiday since world war ii, we have seen $156 billion of market value being wiped out of the topics given all the volatility that was seen as trade tensions between china and the u.s. ramp-up. we have also seen the japanese

yen gain ground on that safe haven move. take a look at what the kospi is doing, we saw the korean won also falling the most in a week as president trump's tariff deadline comes closer. the south korean finance minister also talking about the andomic downside risks, conditions worsening. the one is continuing to weaken. marketst's check in on in this part of the world. we have had the asx just open. it is unchanged. you do have to remember with australia we have a stay of open in alphabetical order. b'sandcks with starting. the a triple see -- the a aiple see released to early

decision to postpone its merger. we will wait and see how tpg telecom traits when we get further down the line here. the aussie dollar holding pretty u.s.y below $.70 new zealand looking pretty flat. the kiwi dollar did take a bit of a thrashing on wednesday when the rbnz decided to cut the cash rate to a record low. it has since rebounded and you see the index kind of flat after that rough day that we had. let's get the first word news with su keenan. do -- house has to judiciary committee is holding william barr in contempt. the vote escalates the clash with the trump administration which is refusing democratic

demand for documents and testimony. the president is using executive privilege over the subpoenaed council'suding the full report. the trump administration is stepping up the pressure on a rant, imposing sanctions on the country's metals sector. iron, steel, aluminum, and copper, it is intended to prevent durant from raising funds to do develop nuclear missiles. it said it would abandon limits agreed to in the nuclear deal unless the eu can find a way for iran to trade despite yuan sanctions. the huawei cfo being held in vancouver says her constitutional rights were denied when she was held at the airport back in december. her legal team said her detention amounted to an abuse of process. also said comments from

president trump were political interference. they are accused of fraud charges while dealing with iran and she is fighting washington's demands for extradition. global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am su keenan. this is bloomberg. paul: let's get back to our top story. the u.s. and china is sending mixed signals over trade. president trump optimism about the deal. aging warning it will retaliate. -- beijing warning it will retaliate. aat do we have here, is this normal brinksmanship where you get into the and of trade negotiations or is it something more than that? : it is pretty hard to gauge. there is a case for those who

say it is excellent chip. the u.s. is hoping to squeeze out some final concessions before they sign off on any kind of a deal. the vice mayor would not be going to washington without some kind of operating brief. then you have another side which says the [indiscernible] and they are serious about pursuing china's and that means the talks are headed for the rocks. we do not know yet. the next couple of days will be critical to see whether or not the trade truce is extended for some time as we push toward a deal or whether we do see tariffs being increased, china retaliating and we had back into territory where we were toward the late -- and of late last year. what could be in the

crosshairs? have escapediffs the basket of goods like toys and electronics. the feeling is that if the trade talks to break down and if mr. trump delivers on his threat to impose tariffs on all of the remaining goods from china, the consumer will start to feel the squeeze. there are these variables, it does depend on whether or not the sellers of these goods pass on the costs or how much of these can be pocketed, how much can absorb the tariffs. itre are various things when comes to tariffs. if we get to a point where the president does extend tariffs on all chinese goods, that is when the inflationary impact will be felt and that will dampen consumer sentiment across the u.s. shery: thank you so much, our chief asian economics

correspondent. let's see how this is playing out with the market with our managing editor chris anstey. we are seeing the nikkei losing .21%. the topics also down cap -- .1 of 1%. the japanese markets are taking andbrunt of the tensions the topix losing 150 something billion dollars in market value already this week. >> that is right. japan joining in the general retreat that we have seen overnight in response to the latest indication on the record from china that they are going to retaliate, should president trump receipt does proceed with the tariff hike. over 20 fords in hours from now. one thing that i think markets is, be looking closely at

even if the tariffs do go ahead, is there any indication that at least the u.s. and china are going to keep talking? i don't think that at this point, a total breakdown in talks has been priced into markets. at the moment, we have had this big retreat for the week so far. people have priced in the anticipation of this tit-for-tat escalation in tariffs. but i do not think they priced in absolute breakdown. we still are hearing signs from the white house that they think a deal is possible. asend -- as enda was saying, they would not go to washington if they thought the talks would be fruitless. as long as there is some agreement to keep talking, the losses in japan and elsewhere may be limited.

that be enough for japan, and agreement to keep talking? what sort of frederick or agreement is needed to change this around, do we need a deal? with japan specifically, going back to the question on what, if you think about has helped a number of the other markets that is lacking in japan, it is domestic support. so the u.s. has had a pretty good earnings season. the u.s. also has the federal reserve that is pivoted to a position ina dovish china, for that matter, despite the big selloff that we saw on monday. you have signs of economic stabilization and you have got a central bank that continues to inject liquidity and support

credit. you have domestic pillars of support in some of these other markets. in japan, what do we have? not much. earning -- earnings season has been mediocre at best. bank of japan not tilting toward greater stimulus. tweakede out with some forward guidance on policy saying that while we will keep rates on hold until spring 2020. that is not a support. on the asset purchase front, the bank of japan has been trimming back bond purchases. then you look at fiscal policy, from all we understand from japanese officials, it is full them ahead with a hike in the consumption tax later this year. we have no pillars of support here on the domestic front that can insulate japan from these trade war tensions. shery: thank you so much for

that. chris anstey, editing manager. let's look at the stocks are moving in the japanese session. we are seeing softbank groups mobile unit rising 5%. we saw the biggest jumps in december after they announced .he deal with yahoo! they are increasing their stake in yahoo japan to 45%. yahoo japan also one point gaining almost as much as 9% right now, right at 5.8%. bloomberg intelligence says that softbank's decision to acquire yahoo japan shares could raise concerns about its use of capital. gaining ground, 2.8%. cicadas assets will be bought for $2 billion and it will take on 400 employees associated with

those drug products. paul: thanks. still to come, tpg and vodafone [indiscernible] after the regulator locked to their merger. they plan to appeal in court. shery: the ceo of cancer drug maker aging joins us from the global china summit in beijing. this is bloomberg. ♪

shery: this is daybreak asia. i am shery ahn in new york. paul: i am paul allen in sydney. the second day of the global china summit in beijing. but crossover to the event with stephen engle. thanks so much. we are here, day two and the

guest lineup continues to strengthen. our guest this hour is john oyler, the beijing founder, chairman, and ceo. it is a domestic cancer drug developer, extremely important --es in the oncology mart market. just the pharmaceutical industry, you have tons of --ulatory changes and eight an economy that is showing signs of slowing. it has been a boom time for this economy. what is your general assessment of the economy as we -- as everyone here is talking about the increased tate -- trade tensions between china and the u.s., how does that impact you? john: living here, you see excitement and tension and nervousness but at the same time, when you fundamentally try to go out to dinner or go anywhere, everywhere is full. i think that clearly, this matters for our industry in

particular. the last couple of years, all of the changes have been positive and they have been counter to nationalization, it has been a story of china and the industry and biotech joining the global system and welcoming foreign companies' products here in china. stephen: we talk about regulatory china -- changes in china and the glacial pace that changes happen. there is so much red tape. in the last year, the last eight months, there has been sweeping, fast change. tell us how it has impacted you. it has brought down a lot of the generic bulk buying orders to the provincial level and that brought prices down. the stock price reflected that but at the same time, one -- what opportunities does it open up for you? john: for our industry there is a shift in china toward let's get the most innovative, the highest quality drugs affordably to the people in china.

there is 1.4 billion patients here. they have not had access to the best drugs and highest quality drugs and there is a true commitment to get them broadly accessible here. that does mean there is a lot of shifts in the industry that basically, china has done two things in the last three years, one is that they fundamentally have reimbursed at reasonable, not u.s. pricing, but reasonable pricing, they have reimbursed my and it is not full, is partial reimbursement, but the best from in the world genentech, roche, different companies across the globe area that is profound for the industry and it is great for patients. the second thing they have done is they have removed a lot of the barriers that prevented multinational companies from being here and competing and they are doing as well as they ever have. for example, the merck astrazeneca, pfizer, they have had some of the best years ever in the last year and their growth in china has been tremendous. it is getting great drugs that

can help patients to patients which is important for everyone. that has been tremendous. the second piece is joining the local clinical system. the great thing for the industry is when you suddenly have 1.4 having drugse accessible and begin paying and helping pay for the very expensive r&d cost up front. that is great. the theater thing you want to do is get these great drugs as quickly as you can to patients. 90% of the time and energy of our industry is spent on clinical trials for it when china joins the system, there is no -- more new instances of cancer in china than there is in the u.s., the top handful of countries in europe and japan combined. those are the places we run clinical trials. so suddenly, we have the ability to dramatically accelerate the clinical trial process which is great. gethen: how quick is it to approval?

i will not try to pronounce the names of the drugs but you have one that is a btk inhibitor and , programmed pb1 cell death protein. it is all oncology drugs. tell us the process where you are getting regulatory approval. beigene, it is about global access. if you are spending the time and energy to take a drug with the highest quality, you don't want it to be only available in china or the u.s. or europe or japan. you want to get it to as much -- many patients as you can. from that perspective, when we started the company, our goal was, be global, be innovative and impactful, and have the highest quality. to do that and have accessibility globally, you need a china to make this reform and it has, and it changes and shakes a whole industry in a very positive way.

because now, all this money we spend up front is going to be spread across many more patients and more affordable pricing with broader access. stephen: do you expect a fairly quick review a tory approval for these two drugs? john: we do, we are in a later stage of that process. we feel very good about where we are in china and from a global perspective, we feel very good of where we are with both of those programs, they are a very late stage. stephen: bristol-myers squibb is in the process of purchasing [indiscernible] they could finally finalize that deal in the second half of this year. what did that do to you as you have that main partner be bought up? great andas been a powerful company for our industry that has helped a lot of innovation. they have been a great partner in many companies, we are one of them. we are doing two things with

them, we are commercializing three incredible drugs they have here. they are great drugs and will continue to do that. from the other perspective we have a collaboration where they from some indications commercialize outside of asia and japan, rpd one. that is a traditional collaboration, it is in a clinical stage. we are nearing global approvals but with this collaboration its own pd1.f has we expect our asset to come back to us. stephen: you have to market it yourself. john: we have the ability to commercialize it after it has been funded. it has been spectacular. the thing worries -- the industry worries about, can a small company handle this? not a small company, we are over 2000 people. from that perspective, as it come back -- comes back, we are

wening clinical trials so will continue to do what we are doing. stephen: we could go on and on and we have. we will send it back to you from the summit. shery: thank you for that and plenty more to come on "daybreak : asia." this is bloomberg. ♪ ♪

paul: the estoril yet, titian and consumer commission is blocking the merger. shares plummeted after the regular inadvertently publish the news. -- curber would curve competition in the telecom market. reporter joins us. let's start with the manner of that announcement from the a triple see. you can only describe it as a terrible scrub.

angus: it was terrible the way this decision was handled. it was posted on the website a day early as a passing reference for a decision it had not announced. when the markets opened, shares tanked 40%. other shares in the hutcheson communication's with the shareholder in the vodafone mistral you adventure, well over 7 billion was lost. this was embarrassing, they started an investigation into how this happened pledging it will not happen again. an interesting decision, not least the way it was handled. shery: we spoke earlier to dan lloyd, the director there and he seemed pretty confident the merger will eventually happen. this is going to federal court. how long could it take?

angus: who knows? we are facing a protracted legal battle. the company is pushing ahead with the union, this is vodafone australia. to they are trying [inaudible] with fixed broadband services in australia. they are pushing ahead, arguing there and in will not lessen competition which is the regulator's argument. the federal court has jurisdiction to decide so they will appeal. they will not dart argue that it's argument is right. this union as it stands really just cements a very concentrated market. three players currently hold more than 85% of the broadband market area data is the same concentration in the mobile phone market. the regular says if we allow another player to enter the market, we will be like that forever and they want tv g to go alone. the only -- only time will tell. for that.nks

coming up next, president trump issuing an executive order sanctioning iran's metal sales. we will discuss the implications. this is bloomberg. ♪

su: this is daybreak asia. the u.s. has confirmed it will increase tariffs from 10% to 25% on friday. the higher tariffs will be made official federal register and takes effect one minute after midday beijing time friday. china says they move is deeply regrettable and is warning it will have to retaliate. mike pompeo has criticized the u.k. warning the government not to go

wobbly, those are his words, a national security in china. and to hurry up and deliver brexit. his blunt remarks threatened diplomatic ties between two close allies and come a month before president trump is due in london for a state visit. pompeo raise the question of what the so-called iron lady, referring to iron -- margaret if china trieddo to boost its global influence. that corporation will be all the more necessary is china -- as china tries to shift the global balance of power in its favor. su: saudi arabia is planning to meet all requests for oil it has june including countries forced to stop buying ianadiant include -- iran crude. still told exports will

be less than seven dollars day next month. china and [indiscernible] have been the leading purchasers of iranian oil. and turning off their apps and protest.- in demonstrations happened in 10 u.s. cities. dysfunction was minimal and riders could still heal a ride with relative ease. this comes ahead of the ipo on friday which may value the company at $90 billion. to the latest on south africa's election, counting is underway with opinion polls pointing to the ruling african national congress extending its 25 years in power. south africa's current president needs a convincing majority to push reforms from within the

party. a narrow victory could hamper his efforts to restructure state owned companies and root out corruption. global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am su keenan. this is bloomberg. we have breaking news, president trump speaking at a campaign rally in animosity beach, florida. president trump saying that china broke the deal. he is talking about the trade agreement that they have been negotiating now for months trade we have heard a more optimistic tone this morning from the white house with president trump indicating china has suggested it hopes to make a deal when senior chinese officials visit washington for negotiations thursday and friday. president trump speaking to his base at a campaign rally saying that china broke the deal. the reaction on the markets has been swift. we have seen the aussie plunging, safe haven japanese

yen gaining ground, also the offshore yuan. reversing earlier gains to fallen the president's comments. we have the vice prayer -- premier heading to washington to secretary with mnuchin. trump has threatened to hike tariffs from 10% to 25% an additional tariffs of 25% on to -- on three to 25 billion dollars. the trade tensions have rattled the markets and president aump's comments right now at rally in florida not helping when he says that china broke the deal. president trump also ratcheting up the pressure on another front and that is on iran. he has banned the purchase of steel, aluminum, and copper as the executive order wreps up the tensions with iran.

they may begin enriching their uranium in two months time. jodi schneider joins us now. what is the trump administration to achieve with the move? jodi: president trump is responding to iran's announcement that it will within limits,stop these abandon these limits on nuclear enrichment unless european countries that have signed the accord, the 2015 accord, find a way to trade with iran despite u.s. sanctions so iran is trying to put the pressure on european countries. at the same time, the u.s. is trying to put more pressure on iran by saying if there is an execute order that has not been signed that says they will be no iron, steel, aluminum, and copper from iran, trying to further isolate iran

economically and put more pressure on european countries that are caught between the hardline the u.s. is taking on iran and what they want to do under the accords. that they are still signatories of. the u.s. decided not to be part of that accord. iran is the 18th largest steel producer in the world. mentioned this does put a lot of pressure on those european countries. what sort of response might we expect? really are caught in a difficult place, this includes germany and britain which continued -- wanted to continue to trade with the red. they are part of the accord but they are feeling pressure from the u.s. this will be interesting and this ups the ante on this back and forth with continued moves

by iran and now the u.s. in response. we have seen the u.s. sending an aircraft carrier to the person gulf and deploying b-52s, what could be next in this ongoing saga? : it is unclear. the u.s. has not ruled out even military action. clearly the tensions are rising. president trump has said he would be willing to meet with , heian leaders someday says, like he did with the north korean leader but they would have to take steps first. they would have to advise him. at the same time, the president is leaving the door open to the meetings. they are ratcheting up the pressure economically as much as they can and this latest move with metals shows that. paul: all right, jodi schneider in hong kong, thanks for joining us. a patienteds say policy pause has helped cut

rates. the feds made be the third to do so. kathleen hays has a preview of the philippine central bank meeting and first quarter gdp. let's start with growth. what signal is attending to the central bank? kathleen: it is opening that door wider. india and malaysia cut its key rate. the philippines is expected to saying theeople are aggressive rate hikes have taken a toll. of toll ie what kind talking about. in the fourth quarter, growth is expected to drop to 6%. that is lower than over 7% in 2017. that, 9% in at 2010. the rate hikes have started a bit of a downturn. curved that,have government spending was slow down by that the budget battle,

the 2019 budget did not get it to place until if role. infrastructure spending is so important, so big in the philippines economy so that is taking a toll. thatit takes up again, will be a plus for the economy. another plus, prices come down, you can find more and have money left over. that is a floor under consumer spending. when you look at the net trade position because this is print,nt to the gdp maybe there is not so many experts but philippines is not the most export dependent country in the region, but weaker investment because business demand is cutting imports. net trade may still be a positive. maybe a smallent, pullback in gdp. shery: how close are they cutting the rates? kathleen: very close.

12 of 23 economists say they will cut but just barely more than half. and analyst has been speaking that it is a matter of until they unwind 175 basis points. the height started in may when the pace was getting so beaten up. now he is saying that there is possible monetary easing because of the global trend. the u.s. has stopped the normalization process. the bank of japan cannot even think of it and that is us a lot for monetary easing. let's look at another chart and you see how inflation has come down so much down to 3%. that is quite a slight over the past several. it was up over 6%. as this comes down, you can look at this bottom panel, look again at what people are expecting for rates in the latter half of last

year. more hikes than the fed started normalizing. the fed started signaling rate hikes would be aggressive in september. people change their view of philippine rate hikes. that turns to cuts and that is continuing over into this year. quite a change of perception. i can give you a couple of notable holdouts who think they are going to wait. is one.f -- nomura they will sit back and make sure inflation has come down and will stay down. bloomberg economics said it is too early to cut rates so flip a coin and we can tell you who will cut or not cut when it comes to the cuts. they: let's go back to campaign rally that president trump is holding in florida. he was talking about china saying that the vice premier is

flying in to continue the trade talks but they broke the deal and they will be paying. that is according to president trump. as soon as we heard those comments, we saw a swift market reaction. we saw not only u.s. futures taking abut also crude hit and falling .6 of 1% which is surprising given we saw in advance in the last session after that supply drop. wti moving toward that $60 a barrel level. this coming aft -- as president trump talks about china breaking the deal. he has threatened tariffs of 25% on $200 billion of goods, not to mention the rest of the $325 billion of chinese imports that come into the u.s. the reaction was swift, the aussie dollar took a hit, not to mention the safe haven, japanese yen started to rally up .2 of 1% and falling below that 110

level. the offshore yuan was gaining ground moments ago but it is reversing those gains and started falling as president trump said china broke the deal and they will be paying as vice -- the vice premier comes to washington and holds talks on thursday and friday with investor lighthizer and secretary mnuchin. paul: after a bright start, the asx gave up its gains on those remarks as well. coming up next, china's inflation numbers are out in less than an hour. we will preview the report and take the temperature of an economy feeling the effects of the trade war. this is bloomberg. ♪

paul: this is "daybreak: asia." watching china's

economy for any effects of the trade war with inflation numbers due later. is iris paying. great to have you with us. we're hearing from president trump making comments at a campaign rally at this moment, talking about china, saying they broke the deal and they will the paying. the vice prayer headed to washington at the moment. the calculation here for the president and for his ace which he is talking -- his base which he is talking to is the u.s. can't outlast china and the trade war. the u.s. economy for a well, the jobs report is strong as opposed to the chinese economy where we pain startingof to show. what his strategy and calculation be correct? iris: first of all, i don't think china is walking away from negotiations. i don't think both sides are walking away from negotiations.

not as something i think, very good description of the deal, the current situation. i believe that the u.s. will raise tariffs on friday and whether this will be more damaging of the chinese economy or the u.s. economy depends on who finds substitutes of the others. china can find some export destinations and the u.s. can find substitutes of imports of goods. this is competing with time, i would say to find a substitute. noyou say that china has chips on the negotiation table, i don't think so. china's gdp growth is surprisingly strong and q1, 6.4% in q4. china has i think as of this

moment has more chips than the u.s. on the negotiation table. what sectors could end up losing if the u.s. goes ahead and pushes hard on those issues that are of concern such as intellectual protection as well as forced technology transfers question mark we have seen the increasing pressure on huawei. could there be an impact on china's 5g sector, for example? iris: that will have an important impact on 5g, but it depends on how other western 5gntries react to china's product. for example, some countries are using china's 5g out of to as a sideline and others are ok. even china invested in their core 5g technology.

it depends. brings to also question if you do not use china's 5g and other substitutes thecan use without delaying start of 5g technology and those economies, because if some asian earlier, itarted 5g seems to me that the western losing the gain of technology upgrade not only an smartphones but other applications like driverless cars or driverless public transport. it is a big deal. ask you to take the temperature of the chinese economy at the moment? we did had that -- have that big miss on trade. we have seen pmi's pulling back. what is your expectation for cpi later today?

cpi, i believe that most of the increase will come the pork prices because of african swine flu and because if you need to have made on your dishes, other meat prices will other increase. this does not mean that domestic demand is very hot, it means issues and prices. i think that cpi is more relevant if it comes to infrastructure investments. is about run material prices and they will increase because of infrastructure demand in china. paul: let's pull up a chart from the bloomberg chart library and it shows the impact of the correlation between pork prices and cpi.

the blue bar that you see there are pork imports which are trending up. that is a potential chance for an upsize -- upside surprise on cpi. that influence the numbers today? iris: for energy prices, we have look at yesterday's trade data. yesterday's export, import trade overall is not that good. imports rose more than exports, which is shrinking. the import picture is overly dominant by oil imports. of course, oil imports. that was all the import supply oil andstic supply of also imports of gasoline from russia. i don't think there will be very

fast increase in energy prices. shery: we saw a tepid reception to the ten-year treasury auction today and there were some conspiracy theories out there wondering if china was done with treasuries as a trade war escalates. is there any chance that if the deal does not go right that take more drastic measures such as adjusting their treasury holdings, or letting the yuan depreciate? iris: letting the yuan depreciate is not a good strategy. that will trigger the sentiment of capital flight which china does not want to have. another thing you mentioned is to sell u.s. treasuries. this is, i would say this is the last resort of the negotiation strategy. if china uses too early, it has nothing less and its pockets. i don't think they would use it to easily and too early.

paying,l right, iris ing greater china economist, thank you for joining us. don't forget interactive tv function tv , you can watch us live and catch up on past interviews as well as dive into any of the securities are bloomberg functions we talk about. you can be part of the conversation by sending us instant messages during our shows. this is bloomberg subscribers only. check it out at tv . this is bloomberg. ♪

shery: we are taking you to live pictures of president trump in panama city beach, florida at a campaign rally where he is talking about everything from venezuela to china. on china he said he was -- it was beijing that broke the deal, the u.s. will not back down until china stops stealing our jobs. he is reassuring people not to worry on china, that it will all work out. earlier this morning, we had some optimism coming from the white house. president trump saying that china indicated it helps to make a deal when senior chinese officials visit washington for negotiations thursday and friday area the vice premier -- and friday. the vice premier coming to with manageo meet and.

hikethe president may tariffs to 25%. they will not -- they will have countermeasures. president trump saying china broke the deal but not to worry on china, it will all work out. that market reaction has been pretty swift, paul. paul: the markets not really heating president trump's suggestion of not to worry. a lot of mixed messages contained in this rhetoric, fromcularly the comment china that retaliation might be in the offing as the vice premier heads to washington. we see futures for the s&p weakening by .3 of 1%. crude also weakening. perhaps japan having the most profound reaction so far, a little more than .8 of 1%. the asx is looking good. it gave up a lot of its gains when president trump began

making those remarks but has recovered, now higher by almost .2 of 1%. the aussie dollar also weekend was weaker when president trump became -- started speaking. the offshore yuan as well started to weaken slightly on the remarks of the president on china area.s. and that u.s. dollar gaining. shery: we have seen the reaction pretty swift across the asset classes. strengthening below that 110 model. the china open is next. this is bloomberg. ♪

♪ upid: hal do you pick insider trading? jay: we use algorithms. we catch people. david: what is the biggest investment mistake? jay: diversify, keep costs low, and not panic. david: the sec case government salaries. jay: i think they have the respect of wall street. david: is there anything i might be -- i was trying to get them a raise. [laughter] >> would you fix your tie, please? david: well, people wouldn't recognize me if my tie was fixed, but ok.