>> welcome to daybreak australian. >> sophie kamaruddin in hong kong. we are counting down to asia's major market open. paul: here are the top stories we are covering in the next hour. hong kong braces for another chaotic week after violent clashes. police may fire live rounds to end the university standoff. the u.s. and china hold more trade talks as they edged towards a deal. pboc warns of challenges ahead

and says it will support a slowing economy. australia fights bushfires on two coasts as the fans -- flames are fanned. hottest days since record began. shery: clicks check -- foraw the dow gaining .8% the first time surpassing the 28,000 level as we had a broad risk on session. s&p 500 being led higher by health care and trade sensitive tech stocks. more positive trait headlines and that helped boost the stock market. semi conductors, the philadelphia semiconductor index at a record high after applied materials came out and boosted sales forecasts. nasdaq also at a record high come up .7%. haven assets broadly falling. 10 year yield rising for the first time last week not to mention that the dollar also saw a weekly loss. we will keep a close eye on what happens in hong kong this morning as we are now hearing

police are ready to storm into the polytechnic university in hong kong. let's see how things are shaping up in asia. sophie: hong kong certainly is a focal point this monday morning. we are seeing stocks looking to gain ground. futures elsewhere broadly higher this monday morning. strategist seeing some improvements going into 2020. jeffries sees current conditions similar to the aftermath of the 1997 financial crisis. modestlyts outlook to bullish. checking in on the calendar for monday, thailand's gdp report and exports from singapore for october due. plus hong kong's jobless rates expected to tick higher in october as the city grapples with a recession amid the ongoing unrest. this monday morning we have a standoff happening at a local university. paul: thank you very much. let's check in on with the first

word news with su keenan. su: we start with saudi arabia, which has agreed to lower its evaluation of energy giant remco into pervak the size of its initial public offering to ensure a successful debut on the re-ads stock exchange next month. aramco will sell just 1.5% of its stocks, about half what had been initially considered. it is seeking evaluation between 1.6 and 1.7 trillion dollars. to the federal reserve now, prolonged low interest rates could dent bank profits and push lenders into risky actions which could threaten the nation's financial stability. the latest twice yearly report of potential threats says cody rose -- erode lending standards. last week jay powell suggested low interest rates may now be a permanent part of the economic landscape. two australia and bushfires which continue to rage across much of the eastern part of the country.

they are set to worsen as dry, windy weather moves in. firefighters are already struggling with more than 100 fires in new south wales and queensland. local residents have been advised to move out. four people are known to have been killed and more than 300 homes have been destroyed, with about 2.5 million acres of farmland burned. and finally, bill gates has regained his crown as the world's richest man. or person, for that matter. he moves ahead of jeff bezos at the close of trading on friday, helped in part by a cloud computing contract at the pentagon. microsoft shares gained 4% after --ting amazon to the his personal wealth is now $110 billion. amazon fell 2% at the same time, taking jeff bezos to a mere $108 billion in personal worth. global news 24 hours a day on air and on tic toc on twitter, powered by more than 2700

journalists and analysts in more than 120 countries. i'm su keenan. this is bloomberg. hong kong bracing for yet more chaos and disruption after weekend of violence between protesters and police. let's go to our chief north asia correspondent stephen engle. we are getting reports that police have stormed the polytechnic university in hong kong after a standoff. what do we know? stephen: we know that the police dogs personalhree operation to clear out the remaining protesters who have set fire to the entrance to the polytechnic university, which is just across the central harvard -- harbor tunnel not far away from here. that operation has started. we of course will keep you updated as that progresses.

however, police have said they will use water cannons and they have used water cannons. we have seen protesters use petrol bombs not only against the police over the weekend but also against citizens who came out to clear much of the debris and the bricks they have placed on the main highway leading into this tunnel around polytechnic university. we have also heard late last week that the number two person in the government, matthew chung, vowing that the government will use more decisive measures. we also got a facebook live statement from the police early this morning saying that they will not rule out the use of live ammunition. live rounds. thise resistance to dispersal operation at polytechnic university is met with increased violence. so we are at a very tense standoff right now. you could go any direction

obviously. shery: and of course we continue to see the protests spread around hong kong. we have seen this rare move by chinos people liberation army coming out and helping in the cleanup. is beijing trying to send a message here? stephen: yeah. it has been highly criticized but also welcomed by this highly polarized society here in hong kong. thing you had nonuniformed pla soldiers coming out of their barracks to help citizens clear out the rubble and the barricades and the bricks. but others are saying it is a slippery slope. obviously we are getting a fire engine going by right now as those fires are raging across the harbor at polytechnic university. the other side of the story is while some people welcome the pla to come out, others are saying this could just be a step

soldiers coming out of their barracks in a more decisive and forceful show, if you will. we are simply in uncharted territory right now. in theces did come out summer of 2018 to help a typhoon clear up. however, we have not seen them come out in full uniforms obviously with arms and tanks. that is the worst case scenario, if you will. paul: in the meantime, the economic impact of all of this seems to be deepening. hong kong's jobless numbers, which have been a bastion of strength really, do not look like they are going to be too good next time around. stephen: yeah. we are getting the october unemployment numbers later today i believe. we are expecting a slight tick upwards. it has stilled heady.

unemployment has held steady at 2.9% since july, but that is a bit of an aberration i believe because if you look at the retail and tourism-related numbers, they are starting to really tick upwards quite significantly. the estimate is for 3%. from 2.9% to 3% in this october reading. we also have economists saying in the hospitality and tourism-related industries it could go as high as 4% by the early part of 2020. the most areas, hard-hit areas like in hospitality and retail and in restaurants, they could go as high as 10% by some point in 2020 if this standoff continues. that could bring the headline number up to as high as 4%. we have not seen for percent unemployment here in hong kong since november of 2010. it does not sound like a high number but for hong kong, which

prides itself on a very robust service sector, it is really starting to hate where it hurts the most in the pocketbook. paul: all right. stephen engle on the streets of hong kong, thank you for joining us. we will of be following protests throughout the day with our guests, including former head of hong kong's criminal intelligence bureau, the former democratic party of hong kong chair will also join us, and hong kong lacko member. the u.s. and chinese trade negotiators held what is described as constructive discussions in a phone call saturday as they look to address each side's core concerns. our china correspondent tom mackenzie joins us from beijing. constructive, what does this tell us about how close we might be getting to concluding a deal? tom: it certainly seems like we are getting very close to its final stage of phase one. of course we heard from larry

kudlow on thursday of last week saying essentially the same thing which they are edging closer now to being able to get a document in place which they can then put in front of the two presidents and sign off on. we know this call happened following kudlow's call. apparently initiated by the u.s. side. the chinese vice premier in discussions with steve mnuchin and lighthizer. and they talked about the central concerns for both sides. we know in the last few weeks they have been working on the details around things like agricultural purchases, commitments from china in terms of time frames and amounts and intellectual property, how to put that framework in place, what will satisfy the u.s. and the chinese side. make sure there is relief in terms of partial tariff rollback. we know those issues have been discussed the last few weeks. seems the discussion over the weekend may have move things forward a little bit. it also comes down to the fact

that in the final stages, often they are the most contentious, and they are often where they break down. so that is the risk i guess looking at these trade talks. and of course president trump has not made it clear where he stands in terms of how much progress has been made. we heard from him earlier this month saying he could be willing to put substantial additional tariffs in place on china if they do not get a deal that satisfies him. so the risks continue but it seems like they are making gradual progress at least at this stage. shery: in the meantime if they don't see progress the chinese economy could take another hit. we saw the pboc releasing third quarter monetary policy report. anything interesting there? tom: they highlighted the main risk in the trade war is and are they trade concerns and tensions around tariffs. they also highlighted the inflation pressure that they are now facing, that the chinese economy is facing as well.

broadly the pboc said the downward pressures on the economy have continued, are now more significant and intense than they were in august. they are going to deploy what they call countercyclical adjustments to ward off some of that pressure. treat is in focus but also inflation. he saw consumer prices pickup by 2.8% as a result of higher pork prices. in terms of the consumer prices, the pboc says they think those are going to start to alleviate maybe by 2020. they essentially dismissed concerns, saying they were largely down to the base effect. tools the pboc can deploy to ease pressure on the economy, it was also made clear in this statement from the central bank that their options are rather limited given that they are of course course trying to contain financial risks. we should ask -- expect another cut the reserve ratios for the banks, but they also stressed

again they would take targeted measures to try to ease and support the economy amid these continuing downward pressures. shery: tom mackenzie, thank you. still ahead, saudi arabia cuts its target for aramco's valuation to ensure a successful listing. we will have the latest developments. paul: and investors remain on the hunt for yield. we are joined. this is bloomberg. ♪

pictures of polytechnic university fires engulfing a part of the university campus. we have heard police were preparing to clear the remaining months traders from hong kong polytechnic university. they have warned they could use live ammunition if they see violence. police have stormed into the university after a standoff, according to media reports. paul: all right.

we of course will be bringing you updates from hong kong as we get them. our next guest is chasing yields as central banks cutting interest rates is the biggest risk facing investors in the economy right now. is aliceus from sydney brown. thank you for joining us. talk more about those risks. we have record lows across the developed world. is the search for yield creating an environment of risk-taking? alice: absolutely. it is definitely a really difficult environment for investors searching for yield, both focused on generating income for their portfolios to meet daily expenses, particularly because in the australian share market we are approaching a record high and valuations are quite stretched. andthe alternative traditional portfolios is looking at cash profits and rbc the income there is not attractive. we have spent a lot of time looking at other options for

attractive income sources and one area we are looking at is fixed income securities and diversified global bonds. they provide a bit of flexibility to rotate back into the australian share market should conditions improve or valuations also fall back to average levels. of course yields on global bonds were not looking too good earlier in the year but they have recovered. is that a trend you expect to see continue? alice: yes. in terms of diversified global bonds, it is really important because they are not an accurate substitute for cash deposit. so we really need to be conscious of the risk that is being taken. that is why it is so important to partner with managers who are conducting due diligence in the company. generally what we are seeing are those companies have quite growth leverage while the increase remains below levels.

shery: where do you find quality in the fixed income market? it is in terms of names really important to look overseas. yields at higher particularly based in the u.s. and also to some extent in europe. if we think about u.s. companies, we have just come out of the third-quarter reporting phase. despite some very low excitations going income this company has surprised in terms of earnings growth and provided outlook.itive earnings shery: we have seen the bloomberg recession probability gr -- drop. probability higher than 30% has usually been followed by recessions. we are now below that. still, when it comes to eco-data analysts we keep getting mixed messages. slump in u.s. manufacturing and yet better-than-expected retail

sales. what are you focusing on? alice: you raise quite a few good points. definitely mixed messages coming out but overall it is quite positive. powellntly heard jerome comment on the u.s. economy, calling it a star economy and saying there was no reason why that could not continue. that has really been supported by the three interest rate cuts this year which have helped american households in terms of feeling confident about job security and cash flow. that has flowed through those positive retail sales we saw. what is driving the u.s. economy? we believe it is domestic consumption which makes up about two thirds of gdp. and overall given that manufacturing weakness content -- tends to be contained at the moment we agree the likelihood of recession is low at the moment. paul: you mentioned equities when we began, particularly australia getting a bit pricey.

how about u.s. equities? we have the fed on pause. is this a test of the markets now? can the market keep pushing higher, or have we reached the limits? alice: we have seen that u.s. markets are now at record highs. in terms of valuations they are not as stretched as australia but nonetheless it is cause for investors to be quite selective when they are looking to invest over the states. seeing the areas we are domestic consumption, areas like health care, technology. one good example benefiting from e-commerce and also digital transactions. earnings really solid from visa recently. it is a real beneficiary of trends to digital payment. over 90% of our transactions are digital. but on a global basis it is significantly lower than that.

so there is a real path for growth and also a capital like business and it has high profit margins. i suppose that is just one example of seeing selective value in the market. paul: can we get your thoughts on the monetary policy reports from the pboc? sort of signaling a little more stimulus. i think something you were expecting. specifically what are you expecting to see? alice: in terms of china the moment we know growth is currently sitting at around 6%. that is the lowest in three decades. also at the lower end of the government target. we are now seeing after very disappointing results from retail sales, industrial some immediate announcements about stimulus. that is really welcome news for and also in the region australian businesses are likely to benefit from that. paul: alice browne, thank you so much for joining us today. just to get you quickly back to what is going on in hong kong,

we have live pictures for you from the hong kong polytech university. fire burning.f police have warned they are preparing to use live ammunition to break up an ongoing protest at the university. police are storming in. we will keep you updated on that situation as it unfolds. this is bloomberg. ♪ this is bloomberg. ♪

shery: you are watching daybreak australia. hp has rejected an unsolicited significantlyte, undervalues the company although it remains open to further talks. issued a statement hours ago saying it was unanimous. su keenan has more. is this the end of the road or will there be more back-and-forth? su: no. what is fascinating here is even of the wording of the rejection

is strong that it was unanimous and too low, they are clearly open to some kind of deal and that is what makes this probably a big story for a lot of market watchers to follow on monday. they did confirm that xerox offered $22 a share in cash in stock. in other words, $33.5 billion takeover. they believe it should be a bigger offer. hp also said they were open to other options including quick due diligence to see what other synergies could exist between the two firms. they say they are quote, open to exploring a merger but there are fundamental questions that need to be addressed. -- oftly the ceo of hpi hp believes xerox has had revenue decline which raises questions for hp regarding the trajectory of its business and future prospects. is thatalso interesting

hp officials want to move quickly on this. so again, there could be a lot of headlines on further talks, but by no means does the deal appear to be dead. paul: activists pushing for union between these companies, citing big profits for investors. su: that is a big part of the store because he is apparently invested in both companies. we know that he had a 10.6% stake in xerox, but it was not widely known last week that he also had increased his stake in -- a four point through 3% roughly $1.2 billion value. notice the xerox stock has virtually doubled in the past year to date. paul: all right. thank you very much for that update. we have an update also from hong kong.

you see fires continuing to burn as hong kong polytechnic university immediate reporting police have stormed the university after an all-night standoff. this is bloomberg. ♪ this is bloomberg. ♪

9:30 a.m. monday morning here in sydney. the market open 30 mids await with futures looking flat as well. this is after we saw u.s. equities closing higher for the weekend. i am paul allen in sydney. shery: i am shery ahn in new york. you are watching daybreak australia. let's get the first word news with su keenan. su: we start with hong kong. the hong kong police launched an operation to clear students from polytechnic university after yet another weekend of violent clashes. authorities warned that officers may fire live rounds if the situation continues. schools remain closed across

hong kong and the protests may force the cancellation of next weekend's local election. the government has cut its growth forecast as the city falls into recession. u.s. and chinese negotiators meanwhile held what are described as constructive discussions over the weekend to address core concerns of an interim deal. the vice premier spoke with the treasury secretary steven mnuchin and trade representative robert lighthizer in a call that came out of washington's request. they agreed to stay in close contract -- contact as negotiations move into the final stages. and the people's bank of china says it is ready to take any measures necessary to support the economy as investment growth slows and factory outflow remains sluggish. an increase in challenges from a previous bid in august and renewed concern about inflation. the external environment has limited scope for action.

where thenka, presidential election has ended in victory for china-friendly to -- former defense investor. 52%, which than showed the country remains deeply divided along ethnic lines. took the north of the island. global news 24 hours a day on air and on tic toc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm su keenan. this is bloomberg. have some more live pictures for you from hong kong. this time we have the hong kong mtr saying the train service on top of the east real line will be suspended. there is some facility damage on the east rail line, so service

will be disbanded -- suspended. also seeing dramatic pictures from the hong kong polytechnic university. fire, police storming the university to break up all my protests. on saturday -- all night protests. on saturday we saw members of the pla on the streets engaged in cleanup. another weekend of drama and developments in hong kong. those lines for you, mtr saying train service on the east rail lines suspended due to damage. shery: we will continue to watch develop it's in hong kong. in the meantime, australia will open at the top of the hour. sophie has a check of the markets. what are you seeing? sophie: aussie shares may open flat this monday after topping a second weekly gain. moving sideways for the most part since august, but there are positive signals of more than 60% of indexes trading above the two day moving average as you

see on the chart, indicating the rally is gradually showing some market breath. jeffries is a mom -- rising trade surplus in their view. deal watch this monday. sent to near eight $760 million deal for a 50% share of a gold mine in western australia, their third gold producing operation last year. tradingre halted from until november 20. paul: let's get some more on what we should be watching as trading gets underway in asia for the new week. another record on wall street on friday and we have investors unlikely to push benchmarks higher although waiting for a bit more news on the trade deal. andrea: very much in wait-and-see mode at the moment. the markets have become very sensitive for all these twists

and turns. we have seen a rally in stocks for the last few weeks as this optimism started building up. i think now we are at that point where investors are really looking for something more concrete. we are getting closer to a deal. asian stocks fell for the first week since last week, which shows after that optimism they just want to see more meat on the bones of the trade talks. probably a good time to look at what strategies are already starting to say about next year. ubs for example is seeing enough cycle inequities, asian equities in 2020 after a very rocky 2019. valuationointing to on the back of long-term averages. a lot of de-risking this year. when you take that along with expectation of growth in the first half of next year, they

are saying that should be supporting for asian equities. of course the big overhang is the trade situation that will determine the size and speed of any earnings. but jeffries is pointing to the fact that global equities are going into next year with a lot of risk aversion. so, they are saying there is space for value out there. this yearw weeks ago but overall, a wait and see and a little bit of looking forward to what we can expect next year. shery: in the meantime we are seeing low volatility ahead of emerging markets. what is going on there? andreea: that is right. a lot of the negatives for emerging markets seem to be out of the way but strategists are rally ishat may be a not something we are going to see anytime soon. volatility east coast to

the lowest level since 2014. you also have stocks failing to respond to signals. we have a chart that shows the golden cross which normally should be positive for stocks since we saw the last time we saw that technical indicator but that is not happening. we also have central banks likely to pause in the easing cycle, emerging-market, local currency bonds have rallied on the back of those rate cuts in asia. indonesia on thursday is expected to pause. also throw in unrest we are seeing from latin america to hong kong, and that is also likely to weigh on sentiment for emerging-market. so very much a mixed bag and something to look out for as the year draws to an end. shery: thank you so much. of course you can find her charts on the gtv go library on the bloomberg. here in the u.s., house speaker

nancy pelosi is giving president trump the chance to make a case directly to the intelligence committee as the impeachment inquiry deepens. she also vows to continue protecting the identity of the whistleblower. not will make sure he does intimidate the whistleblower. come before the committee and speak all the truth he wants if he wants to take the oath of office, or he could do it in writing. he has every opportunity to present his case. now, we are inny the public phase of the inquiry. where do things stand? ros: as you mentioned we are in the public phase. we had drama last week. more drama expected this week. three more days of public hearings with eight witnesses. speaking this week is gordon sondland, the u.s. ambassador to thethree more days of public

eu and he has been a big trump donor. he has already commended the closed-door testimony he made on the trump impeachment inquiry. some see him as a possible key of all the things that happened this week, so watch for him. also want to stay for jennifer to mike penceide who was on the now infamous call between trump and ukraine's president. she has criticized the president for that call. she will be talking publicly. trump took to twitter today to criticize her, calling her a never-trumper. smacked of a tweet he sent thursday about marie yovanovitch, the former ambassador to ukraine. this is really under president trump's skin. you can see that on his twitter feed hour-by-hour. and certainly we don't know when the process ends, although this week's three days of hearings

are the only ones now on the schedule. paul: ros, of course the president is no stranger to controversy during the campaign or his presidency. but is this taking any toll on his political brand? ros: it is always hard to tell exactly what is happening but you can see for example on saturday when the republican candidate lost the governor in louisiana a very conservative state. the campaign that trump had really become involved in on twitter. he had to rallies in louisiana and the republicans still loss. -- pundits would say his brand has been damaged whether by impeachment or other factors, it is hard to know. but certainly that is something adds to his angry response to what is going on. paul: ros krasny, thank you for

joining us. desperatestralia, a fight going on against devastating bushfires on both the east and west coast. authorities are expecting conditions to worsen again this week. lightning strikes combined with rising temperatures and dry winds and little to no rain forecast, aggravating an already dangerous situation. weekend?ened over the >> some of the focus shifted across the west coast. as i love what we have seen so far has been concentrated on the east coast. the main city on the west coast had its hottest day since 1980. that triggered a whole spate of fire warnings. of relief onle bit sunday on the east coast spirits some cooler weather, even a smattering of rain. but it is still a very dangerous situation. shery: so what are we expecting

this week? emily: towards the end of the week we expect on the east coast, we expect conditions to worsen again. essentially the weather is so dry and there is so little rain that there is not actually enough opportunities for the firefighters to get the fire completely under control. so, we are on alert for more fires to break out again on the coast. goingnger areas are not to be as close to sydney as they were previously. they will be more up away towards the greens land -- the queensland border. but essentially another week of firefighters battling to keep fires under control. shery: emily, thank you so much with the latest on the bushfires in australia. we also have fires in hong kong, but these are because of the protests ongoing at the moment. you are looking at live pictures. now, we have heard from the hong kong subway train operator saying that the west and east

rail lines have been disrupted due to facility damage. they have also closed a station. hong kong police now coming out and saying they have not raided university campus. they are also saying that rumors stated police were waiting at the premises of polytechnic, but that statement is totally false. they reiterated they have not raided the campus of polytechnic university. earlier we saw fires in the university campus there. paul. paul: thank you. while saudi aramco unlocks the numbers of his long-awaited ipo, we will see even on the low end of expectations it is still an impressive offering. this is bloomberg. ♪ ♪

youy: we continue to show breaking news out of hong kong.

polytechnic university has been the site of endless protests. we are hearing from the hong kong police, they are now saying they have not, quote, raided the university campus. since midnight there was a large gang of rioters throwing patrol bombs at the police, according to police. they say they have been conducting dispersal. we know protests continue around hong kong. the mpr subway operator saying the west redline, the east rail lines, they are disrupted because of facility damages. a station is also closed. paul: all right. aramco's wellet below the crown prince's goal, and pared back the size of the sale. let's bring in our energy jporter jam with morees -- ames with more.

where the expectations too lofty? there has been a certain amount of expectations. have pulled back the offer to 1.5% is perhaps recognition on the saudi's part they will not get the level of interest they initially hoped. in fact that has made material that they will market a deal in the u.s., canada, australia and those places. they are really relying on local investors to back this up. the saudi central bank has relaxed lending limits on local institutions, so you can see that is another measure to bump up this deal. i think they will look to russia and china also to get some financial backing to the deal, and that will certainly help as well. shery: still falling quite short of their initial aim of raising as much as $100 billion. james: yeah, that is right. i think that was always a little bit ambitious. the problem is it is a tough

sell. -- and of course on top of that we have the political risk, which is made obvious by drone attacks we saw back in september which had such a huge impact in the oil markets. investors are also wary about that. the fact these have been trimmed down since the original $2 trillion is purely a reflection of those risks. shery: thank you. let's discuss the prospects of this aramco ipo now with ayham lead forrasia group's the middle east and north africa. he is on the line from london with us.

great to have you with us. jim was just telling us how difficult a market is when it comes to oil and for institutional investors. so, will there be enough at least local demand to sustain this offering? ayham: i think with this offering and this valuation i think you are looking at a success rate. it will be retail investors within the markets, sovereign aramco ore to the would want to support this offering. some asian demand as well. it is western demand we are talking about that is going to be lukewarm. part of it is geopolitics, and part of it is the aramco ipo plan. remember that this plan has been changing for a while, starting with an international ipo, now local. 5% of the company, now it is 1.5%. so, i think this is just a trial

for the crown prince of saudi arabia to say to the international community that i am moving forward with what i promised as an ipo. what i would emphasize over here is i actually think a lower valuation is better for the crown prince today, given that retail investors in saudi arabia will be subscribing to this. sharpally do not want a dip in the stock price after the initial flow. that would damage the crown prince. shery: the expectation right now is the kingdom's richest families will be pouring their money into this ipo. you do wonder what the dynamics are with these family members, when just a couple years back were staying at the ritz carlton and we had a corruption probe going on. ayham: absolutely. it is a complex relationship. these big families really have so much invested in saudi arabia. they cannot simply pick up and leave.

is, ofstion i think here course they would have subscribed to the ipo, but at a lion valuation and would have been a stretch. it would have sent the wrong signal to markets. of course he can lean heavily on these, especially after the ritz carlton episode, but i think he will go with a much more moderate option, which is work with me here on aramco's ipo and there valuation on close to market expectations. i think that is the much more realistic option. paul: just wanted to play devils advocate here. let's look at the situation here. we have a scaled-back ipo, we have families in detention encouraged to get involved, we have the central bank relaxing lending limits to boost demand. does all of this just have the slightest with -- whiff of desperation about it? ayham: i think it was a

difficult ipo, and the timing is difficult, essentially after the attack, probably from iran. it is a difficult political environment. and of course all of the complex challenges, economic and political, that saudi arabia is facing. in my mind of course it was not an easy one. what you have is relaxation of lending rules, but they will not do with that simply. sure, they will lend to big institutional investors, but at a $2 trillion valuation. i think lending rates would have been different even with instructions from the central bank. so it is not perfect by any ipoure, but pulling and after that i think was a tall order. it was the crown prince's decision to proceed with the ipo in this timing, and of course oil prices are really not high

and are looking at a challenging first half of 2020. a difficult one to achieve over here. at the least they will pull a half success, but good enough for the time being. paul: do you think maybe they should have happened a few years ago? things have changed. climate change, growing distaste for pearl -- for plastics. are the best days for oil now behind it? ayham: we probably have one more cycle for oil over the long-term. still think there is various demand there. should this ipo have been done a few years back? i think that is part of the tension between the leadership and the former energy minister, who really insisted on a longer timeline. so, i would say that probably two years would have been good enough because the environment

really has not changed specifically in terms of oil prices. they could have done this a couple years ago. paul: all right. ayham kamel, thank you so much for joining us. you can watch us live and see our past interviews on our interactive tv function, tv . you can also dive into any securities or bloomberg functions we talked about. and become part of the conversation by sending us instant messages during our shows. this is for bloomberg subscribers only. check it out at tv . this is bloomberg. ♪ s is bloomberg. ♪

let's get a quick check of the latest business flash headlines. airbus is said to be in talks with general electric for a second engine choice to challenge rolls-royce. the new-car unit cost for potentially lower emissions and help airbus launch a greater competition for the 787

dreamliner. the new engine would based on the june -- on the design currently in the boeing 777-x. shery: bowling and emitting it will have to work hard to regain giraffes -- regain trust as the 737 max 8 -- to safetydedicated and integrity, and knows they have to resort customer confidence. the max has been grounded since march after two fatal crashes that killed 346 people. paul: plenty more to come in the next hour on daybreak asia. we are joined by kissinger associates vice chairman bob hormats. shery: and some big guests coming up from bloomberg's new economy forum this week ceo, ing the prudential and more. that is it from daybreak australia. we will get more of the action in daybreak asia, next.

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paul: good morning. under one hour away from the market open in japan and south korea. shery: and good evening. sophie: i am sophie kamaruddin in hong kong. welcome to daybreak asia. paul: our top stories this monday, hong kong police say they are dispersing and arresting protesters after a dramatic standoff but deny they are staging a raid. u.s. and