>> welcome to bloomberg markets: asia. i am paul allen in city -- sydney. here are the top stories we are covering. the market rolls on as the coronavirus as, conditions set for a perfect storm for asia entering their territory. demand for crude falls again. russia and saudi arabia are

india -- italy locking down the whole country. let's get straight over to the markets now, we are joined by sarah ponczek. one of the -- one of the highlights? helling --say the the selling has not stopped. saw a limitafter we down in futures yesterday, we and at the same time we have new zealand coming on, getting closer and closer, well below the 200 day moving average which served as support earlier on. at the same time, we have seen dollar-yen moving closer and now

the yen is trading at the highest level. prior to the presidential election in the united states, and also, the vti crude oil extending losses again after the worst day since the 1991 -- >> we have seen absolutely massive moves. day, we didf the close down 7.6% and if you look at the different barometers, we have seen massive moves. the average move over the last eight trading days has been 3.7%, that is the largest going back to 2008, so to put into context the amount of volatility we have seen, the vix also at [indiscernible]

>> let's get more on the market wrap right now. how much further have we got to fall here? has workedthe market itself into a position where we do need monetary authorities to come up with something strong and possibly what is lacking in terms of a fiscal response always seems to play catch-up even though we have been doing .his for several months now >> you say we are waiting on it fiscal response, we are expecting a monetary response at .east what is your base case for the next move for the fed? cut and i they will think it is subject to how much

volatility we wind up seeing. i would expect them to calm more forceful than they did last week. i think they tried to save some of the ammunition in the market. -- whether it is dollar liquidity that we saw earlier today. >> i want to bring of the chart curve nowentire yield below. is intervention needed in the bond market, something like yield curve control? >> i think of this point, and it is unfortunate we're talking about in this type of context, lower rates are nothing to

demand when it comes to the type of issues we are dealing with. we are trying to pull volatility of the market so there is one less trigger for societies to retrace the ways this virus is created whether it is by decree being veryies and cautious. bull market don't die of old -- old age. what has it been killed by? >> one of the things to remember is ultimately we will get through this. we hope it is sooner rather than later, but we are going to have monetary policy as loose since really the crisis errors and

when it is compelling, we want to think about how we will put that into work. there's a lot of conspiring against the markets and really, we're going to see a global recession is not just in anybody's playbook and it does price back quickly. has a recession that is inevitable, do you think it is inevitable? >> i'm not quite there yet. if we go by the official cases, i understand there's a lot of concern of the data and with a response. if it is closer to a seasonal flu, it is a beautiful day in the northeastern united states and maybe that would be a trigger for us to hopefully walked back, but at the moment

it is certainly hard to see at least the intensity of coverage anytime soon. here whereomforting winter has yet to begin. here is the next up relative that we hear all the gains have been wiped out. how likely do you think that will happen? >> i think from an equity evaluation perspective, that is not out of the question. we really have adjusted to changes in the bond market is more than even what the equity via has been, so i would get used to volatility and get a handle on both monetary and the as hard asng to be anything we have dealt with. >> we have not even mentioned the oil markets.

are you looking for any circuit breaker or catalyst that brings an end to the oil price war? >> unfortunately, no. it is in with the broader commentary and now you have supply issues going along, so it was, in addition to many of the data points we received, the last thing we needed to add to the mix, certainly u.s. yields are pricing in just how hard it will be to get rock on. to certain degree, not too much, but it shows the growing concerns around inflation and how commodities will come back to stop >> i wanted to return to point -- come back to. >> i wanted to return to your

original point. >> the -- i think we need bipartisan support for more than just talk and studies. there's very low expectation for something, certainly europe is dealing with it. you have the ecb later this week, so let's start there and hope our administration and congress starts to take this more seriously than what we have seen. >> thanks a much for checking the first word news. capacityre expanding cuts as demand continues to be hit by the coronavirus, nearly all of the airlines will be grounded with just two of 12 still flying. -- alsoget division

reduces by half. candidates return states vote.x bernie sanders hopes to repeat of fourigan victory years ago to keep his campaign going. first time states decide since the race was narrowed to two. -- they denounced those as fraudulent and said he is the rightful leader the impasse threatens the peace deal between the u.s. and the taliban. and, led zeppelin has won an appeal that says they did not

steal the rift for stairway to heaven. the court said they did not take the vital series of notes by a californian band in the late 1960's. global news -- >> global news 24 hours a day, powered by more than 2700 journalists and analysts in over 120 countries. >> thanks very much, still to come we look at it bouncing back, but of next, italy has locked down the whole country in a bid to spread the coronavirus. -- prevent the spread of the

coronavirus. ♪

>> let's get a quick check from the latest business flash headlines. we are actually talking coronavirus andy situation in threats of a the coronavirus continues to grow. what is the latest? announcementd an from the prime minister they are going to expand the measures taking place to the whole of the country, so they will then sporting events -- ban sporting events, things like going to the jens, swimming pools and now they are going to restrict

movement. you can only travel around for work or health-related reasons, so this is a way to encourage people to stay home as much as possible. >> can you give us an impact -- a sense of the impact of the extremely radical decision? >> it will be a very big hit for the economy. clear it will be sharp. entire sectors like tourism or facinglity a really essentially zero revenue at the moment or close to that, so it is pretty dramatic. has -- italy has a very large so all eyes are on the european central bank which

would meet on thursday and decisions you might take to contain the impact of the market . >> we also have news out of germany concerning debt and putting an export ban on masks. what theell us reaction has been for the rest of europe? isi think what we are seeing a number of european countries as italy,ing the same just with a delay. it is just a matter of timing, so i expect other european governments to come under pressure and take measures that -- not justing

germany, but also france seem to .e doing at the moment any expertd not be i think any goods, so it is a very serious issue, but shows how governments are scared which would put an enormous amount of pressure on the health care system, especially with regards to intensive care units. >> we have the french president on thecooperation coronavirus. how can we rate the level of cooperation so far or has it been everyone for themselves question mark >> i think there has been a reliable mac --

reliable urgency. governments talk about the need for a fiscal stimulus for things, but we have seen very government.e a fiscalas passed stimulus of $3 billion which is really peanuts. andye virus spreads consequences become clear, in theents work together question is just how important the measures she will announce. thank you so much for joining today.

increasees continue to around the world, they appear to wang inng with selina beijing. what can you tell us? >> a number of cases in china morenued to flow, but well than 100,000 cases in the world, but has not reached the level of pandemic all the it is getting close, despite other experts saying it has already reached which it means and and they make that has reached worldwide. they really want to focus the intention on containment and not spreading any panic, so the number of cases you have seen it dramatically slow down out of china, but now it has all in behind italy and they managed to

mostly keep the virus in surrounding regions and they have been testing for the virus at the fastest pace around the world. >> what is the main priority for china's government and corporations? >> you would think you could breathe a sigh of relief since the world health organization china representative says the peak has passed for china, but there is no guarantee this will remain the case as there's going concerned that it could escalate again as people come back from overseas and could reimport and someside of china travelhave put reverse and major cities including beijing need to carry out and overborder checks the weekend, the city reported that a majority of infections have been coming back from

people overseas. like the pressure is going to continue. manufacturing firms across china have been telling bloomberg that the though they are operations, they are worried about it spreading worldwide and a half customers canceling orders. for instance, a lighting company says the virus has forced them to cancel client visits and exhibitions which means they are getting reduced orders and economists are worried that this is just the beginning of this even though china is recovering on the supply side, they have to deal with demand shock with lower demand around the world. >> thanks for the update. we will be speaking to the world

health organization later today, but for now, let's take a look prettyu.s. futures, a brutal start to the trading week , futures not as bad as they were. we have crude in new york just half an0, a little over hour from the opening, futures lower.g sharply plenty more to come. this is bloomberg. ♪

quick check of the latest business flash headlines. shipments plunged last month according to data from china. this is it forced the closure of

apple stores on the mainland. apple has started reopening outlets in china to help sales and demand recover. of chairman and ceo suspending their salaries to help the online platform deal with the fallout. they announced the move and other senior management set to half of compensation. grab has shut offices in singapore and thailand as it begins a five-day deep clean. they previously visited the theital and the coming says office will be closed and facebook shut its office.

still to come, we are going to take a look at the prices of oil as prices fall the lowest since 1991. ease.prices continuing to just about half an hour away from the open here in australia as well, futures sharply lower than 4.8%. we have been hearing quite a bit out of australia, qantas cutting capacity further and the ceo will not be taking an annual salary for 2020 oh stop also been hearing from the australian minister -- prime minister who gave a speech and said the impact of the corona crisis maybe greater. we are awaiting news of a fiscal stimulus package, but the aussie

above still holding, just $.66. pretty close to parity. plenty more to come. this is bloomberg. ♪

to repair not going itself. >> many countries are going to be hit. to throw sos going much liquidity at this thing. >> i don't think this is a micro problem. will not sort itself out before some further damage, unfortunately. earlier guests weighing in on the global selloff. we just heard him say do not

buy this dip. investors not yet stepping into stem any of the bleeding. cashs the worst day in the trading session since 2008. one point futures were off by 1.9%. that brought the futures contract down more than 20% from the record high. putting a bear market insight, when we do get to cash trading for the u.s., tomorrow at the same time the kiwi under pressure, having its workstations 2008. i just want to point to this because the fear at one point fell to 31 basis points, you see this massive, historic move. but is not just flight to safety within the bond market and commodities, we are also seeing it within the equity market.

goldman sachs pulls together different baskets of stock based on the health of their balance sheet. so now with the oil shock, we're dealing with the potential credit crunch and that's what investors are truly worrying about. stocksbalance sheet outperformed the week balance sheet the most since 2008. the dow jones market neutral basket of quality, that means going long, shorting the lowest quality stocks. longest six-day streak since 2009 so clearly investors are focused on the balance sheet right now. paul: thanks very much, sarah. we will get you across to president trump now who is about on the latestfing response to the coronavirus outbreak. let's listen in to that. here we go.

we are still waiting on president to make an appearance there. you see the briefing room full of reporters and other staff. as we wait for the president to arrive, what should we be watching out for on asian markets today? sophie: waiting patiently and nervously. i want to highlight reports with the vix. .riple digit territory making.rspy can the we've already seen $100 call contracts after we saw the index jump to 2008 hike. also a job in debt calls.

confirming the move with the are aside not -- expect the momentum to be ramped up with other factors coming into play this weekend. president trump: i attended a very important task force meeting on the virus that everybody is talking about all over the world, no matter where you go, it is what is on people's minds. it something we're going to take care of and have been taking care of, the american public and the american economy. we are going to be asking will be meeting with house republicans and discussing a possible payroll tax cut or relief, substantial relief, very substantial relief. it's a big number. we are also going to be talking about hourly wage earners

getting help so they can be in a position where they will not have to miss a paycheck. small companies and large cabbies, a lot of companies so that the don't get penalized for something that's not their fault. it's not their fault, it's not our country's fault. this was something we were thrown into and we have been handling it very well. the first ones ever to shut down our borders, we've never done that in our country before. the situation would be a lot more dire. also we will see the small business administration and loans for small businesses. were also working with the industries, the cruise ship industry which obviously will be hit very strongly. we want people to travel to certain locations and not to

other locations at this moment. hopefully that will straighten out sooner rather than later, but we are working with the industries. we are also talking to the hotel industry, some places will do well in some places probably won't do well at all but we're working closely without tail industry. the main thing is we are taking care of the american public and we will be taking care of the american public. i really appreciate the professionals behind me and the professionals behind them and it different room. we have a tremendous team headed up by our great vice president, mike pence. he has been working 24 hours a day just about. he has been working very hard, very diligently and very professionally, and i want to thank him and thank the team. i will have mike say a few words. thank you very much. >> thank you, mr. president.

today'scompleted meeting of the white house coronavirus task force. we had the opportunity to brief the president on a broad range of issues, and once again, because of the unprecedented action president trump took in january, suspending all travel from china and establishing travel advisories for portions of south korea and italy, establishing screening of all direct flights, all passengers from all airports in italy and bought aea, we have considerable amount of time according to all of the health experts to deal with the coronavirus here in the united states. today, thebefore you risk of contracting the coronavirus to the american public mains low and the risk of serious disease among the

american public also remains low. that being said, the president did deploy not just the whole of government approach but also the whole of america approach and last week at the president's direction we met with leaders and industries from nursing homes to airlines, pharmaceutical companies, commercial labs, and have had great input. pharmaceutical companies are already working literally around the clock on the development of their pukes that will be medicines that can bring relief to people that contracted coronavirus. and i know how please the president was to learn that the commercial labs in this country led by companies like lab core and quest have already brought a test forward and are taking that to market effective today. this week at the president's direction we will be meeting with hospital ceos, health

insurance ceos and all building on top of what the present will be announcing tomorrow with regard to economic relief for working americans. we also met today in a conference call with 47 of america's governors. we will brief them on the latest progress we have made. we were able to confirm with them that testing is now available in allstate labs in every state in the country, over a million tests have been distributed before the end of this week and 4 million tests will be distributed but as i said before, with the deployment of the commercial labs, we literally are going to see a dramatic increase in the available -- availability of testing. that is all a direct result of the president's leadership. moments, we will

thatne community guidance will be published. at the president's direction we are going to be providing guidance about how to keep your home safe, how to keep your business safe, how to keep safe and healthy at your school and we will be publishing that information and speaking about that. a brief word about the grand princess. the grand princess has talked this afternoon in oakland -- has commercial.. 25 children on the ship are all healthy. of the people that had contracted the coronavirus, 21 in all are being dealt with improper isolation, working with health authorities in california, we hope before the end of today to begin to disembark.

to travis residents air force base in miramar. we made arrangements with canada and the u.k. to take their passengers back. they will be transported directly from the tarmac to charter flights home, and tomorrow the remaining passengers will be transported, again through very carefully controlled environments, buses, out to the tarmac and flown to military bases in georgia and texas. all the passengers will be tested, isolated as appropriate, quarantined as appropriate, and i want to express appreciation to the governor of california and his administration, the governor of georgia, the governor of texas for their strong cooperation with us in solving the issues around the grand princess. it has been a partnership which

the president directed us from the very beginning, and the will be detailed in a few moments, continues to work and move forward. the remaining people on the ship, the crew itself will push off from the dog and they will be quarantined and observed and treated shipboard. the president made the priority to get the americans ashore and we are in the process of doing that as well as returning foreign nationals. let me just say one other point as the president has spoken today to congressional leadership, one of the things i informed the president is the concern about hourly wage earners in this country feeling that they had to go to work even if they were ill. the president has tasked this economic team and is working already with leaders in congress that anyone who

feels they aren't risk of losing their job or losing a paycheck because they may contract the coronavirus. we tell people if you're sick, stay home, and the president has tasked the team with developing economic policies that will make it very clear that we will stand ,y those hard-working americans stand by those businesses large ,nd small and make it possible as the president said from the beginning, to put the health of america first. we will be available to take questions on any of these topics . president trump: i think what we will be doing is having a news conference tomorrow to talk about various things we are doing economically, including obviously the payroll tax cut, so we will be meeting again tomorrow and coming back from the senate, a lot of very

important meeting set up, and we will have a press conference sometime after that and we will explain what were doing from an but thatstandpoint, will be very dramatic. we have a very strong economy but this line side of the world, and i think we have handled it very, very well. we have done a great job, the people behind -- the people behind me have done a great job. i will be here tomorrow to let you know about some of the economic steps we are taking, which will be major. thank you very much. paul: president trump leaving the stage there without taking questions. cirilli, i kevin guess the stand out the

discussion of payroll tax cuts. --in: there are three's three things, the president announcing first and foremost tomorrow they will announce some type of economic package that will be announced from washington, d.c., clearly designed to help americans and also to calm the market. second point is that on capitol ofl, talking about a host regulatory relief as well as tax relief. the final point i would make here is that washington is really waking up, as they look minimize mitigate and the threat that is now happened. in terms of where this goes from a political story, very much right now it feels like an increasingly economic story, especially from the vantage point of the administration. shouldy secretary my new and one of the present -- steven

mnuchin will be having lunch with republicans in the senate on tuesday. we should also note that beyond that, host of democratic senators have asked for some regulatory guidance that regulators might be able to provide to financial institutions, to consumers who might have to work from home and might not be able to comply with their credit companies and credit insurers, so many different economic conversations happening in washington dc, but what we just saw their, president trump and vice president mike pence and a host of other administration officials that are continuing to speak, they are trying to get out in front of this from not only a health standpoint but also from an economic standpoint. the big take away is that an economic component of this will happen new york time tomorrow afternoon. far, how wouldus you gauge the temperature of bipartisan cooperation?

toin: you have to be able divorce the politics from the policy. there's a potential to be somewhat divided, especially in the last week. that said, $8.3 billion of in a packaged that has come within the last 72 hours from the was republicans and democrats working together to advancing that package. $8.3 billion just to put it in perspective is still a fraction of just what lawmakers had previously allocated for hurricanes and other natural disasters. so there wasn't a budget fight on that front. but you start talking about -- it coulding to be more politically polarizing. it has provided a lot of political pressure for lawmakers on both sides of the aisle to really pay attention to

this from an economic perspective as well as from a health perspective. correspondentuse kevin cirilli in d.c. thanks for joining us to wrap up the news conference with president trump. joining us from houston to discuss all the upheaval we are seeing on the oil markets, we have john, an advisor to the president. apparent war on with u.s. shale drillers. how does it compare to other oil shocks you have seen in your experience? john: this is much different than what we have seen since the 1970's and what took place and sin. this is the first time were going to have increasing supply if saudi arabia goes ahead with their plans, at the same time we had a decrease in declining demand. so this will be a very difficult

situation as we move forward here. a chart here on the bloomberg terminal that oil,trates the trend for it appears to be heading to sub $20 a barrel levels. what is your outlook? john: we agree with that. we think it will approach 20 and bright below $20. this is very consistent with what we have seen in the past in terms of reaction. this will be much more severe than what we saw back in 2014 $40,the price broke below down into the $30 range and now roll into the high 20's. so expect oil to break through 20, as long as it goes forward as what we are seeing right now. paul: we were hearing earlier today from the iea executive director, saying do not

underestimate shale producers. let's have a listen to what he had to say. >> one should not underestimate the resilience of shale. think of the impact it will have discovery ofe than a new oil policy. it may be playing russian roulette which may have grave consequences beyond oil. paul: so russian roulette, guess the question is, how well positioned is it to supply a war of attrition on the oil price? john: both saudi arabia and russia at some point, low oil prices will have a negative impact on their economy. have a were going to reduction in shale production. if not, it's going to get very nasty for a long time.

we cannot have shell continuing to grow as in the past. thinking it will take several billion barrels off to get to the markets balance between supply and demand. paul: do you have a sense may be that the oile war market had to have, how conclusively does it move that all those production cuts didn't really work? john: similar to what we've seen back when saudi arabia tried to balance all -- oil markets in the mid-1980's, they reduce production substantially by 5 billion barrels and they still cannot balance the market. we have seen the same thing here. rebounded,oil prices shale came on and added 2 million barrels in 2018, another one point 2 million barrels in 2019. during that timeframe, demand

only grew by less than 3 million barrels a day. that shows it's very difficult to balance the market by unilaterally cutting supply. there standpoint, there has to be some structural shift where there is a slowdown in how much production is going to come out from the shale side of the business. john, thanks so much for joining us with your views on all the upheavals in the oil market. let's check on the equity markets right now. up by .15%.utures looks pretty good in the context of today's selling, crude in new abouttill holding on at $31, rising ever so slightly. pared some of those

declines, off by about 3.8%. plenty more to come. this is bloomberg. ♪

paul: i'm paul allen in sydney. you're watching bloomberg markets asia. qantas has expanded its capacity, including grounding most of it superjumbo's as the coronavirus further trims travel demand. david, is this going to be enough to protect qantas from the virus? david: obviously it is scary for any airline in the current environment. we don't know how long this virus is going to go on. you tend to fade away as get to the summer months. seen coronavirus in that period.

with sars you saw quite a rapid recovery. qantas doesn't know what it is facing. the way to look at this is, it's a bad idea to let a crisis go to waste. you are sharply cutting international capacity. your competitors are doing that ofway so there's a lot uncertainty around international flights generally. your international flights are -- a lot of it is self-help to some extent. obviously not a good time to be an airline. kerosene is the cheapest it has been since a brief period in late 2015. it's going to be a few months for qantas. paul: a difficult few months,

but could qantas potentially be better off than some shareholders are fearing? david: obviously no one wants to in view of arlines pandemic. of qantas -- valuations are actually cheap. well below levels they been at in recent years. but it's below that not bargain basement prices. we will have to see what will happen going forward. one thing that will protect them on the balance sheet side, they are a lot better off than they were back in the early part of the decade. the balance sheet was looking very weak. this time around it should be a lot more healthy. paul: david, thanks so much for

that. stay with us, we have the aussie market opening in just a few minutes and trading is getting underway as well. the index weaker by 4.5%. this is bloomberg. ♪

paul: good morning i am paul allen in sydney where markets have just come online. welcome to bloomberg markets: asia. markets slump again as oil drops. territory.ering bear energy stocks take the biggest hits.

moscow vowing to never surrender. italy locking down the whole country. we did see a modest tilt back to read. australia is still under pressure at that 20% threshold. it could provide a larger hit to australia than the global crisis. new zealand under pressure too. nikkei futures are pointing to a higher open after falling 1.9 percent earlier and are now up 1%.

let's take a look at how fx markets are training. .e have seen some steadiness we see the dollar trading higher versus the yen. holding at strong levels. we see the aussie dollar returning to strength, the best-performing g10 currency today. worst day after the since 1991. paul: let's get more on the market. burrisapital cio george is joining us now. how are you positioning yourself and what is your plan for the day? >> positioning is watching the market and going into the new

year to set a bit of context. not enough shorts in hindsight. monitor and review each stock in the portfolio and where are the embedded risks going forward. us trillion enters into bear market territory at the moment. >> we were hearing from bob michael a little earlier on bloomberg. he was saying to keep your cool. the theme of their tweets is essentially calm down.

how likely are investors to heed these words? >> the markets particularly last .ight there will be some form of default in that sector. valuations in themselves look more appealing at the moment, but that's not what this is all about. how much of that goes to the next quarter and the impact on earning. while it is possible it is improbable. i can't see that scenario

turning into a global oppression. were contemplating what the recessionary scenario would look like. with unforgiving ratios will be highly scrutinized. markets and earnings taken impact with the supply chains in the very sectors. the h1 ono look at its own merits. a glhf i might get some comments on you, but in terms of the are youo avoid, concerned defaults could start to accelerate? is there anything specific you want to steer clear of?

>> credit markets have stalled. that has been one of those signals. there are two things going on. there will be an increase in downgrades. the second narrative to have a look is the maturity profile. the default scenarios to accelerate. the thing to avoid would be energy to this day. capital managements, buybacks on hold and holding back the dividends. buybacks are on hold in general.

they would talk about the perspective yields for 2020. momentum would start to worsen even though the outright yield looks appealing. and as current quarter we progress to later this year. paul: they have started trading off of 7% now. the numbers are falling faster than i can keep up with. what they have announced today is the second round of cuts addressing the covid-19 issue. it is a more realistic and more extreme reaction. but to ground all but 10 of the 380's is a pragmatic thing to

do. position,a good cash and alan to take a pay cut with the chair showing the right empathy of how to deal with this in the market. witheading airline dealing the most unforgiving challenge in this cycle. it will be a litmus test for how other markets should be reacting. don't pay the dividend and try to pervak capacity and divestment when possible. cutting the salary for the rest of the fiscal year is a good sign as well. >> we were speaking with david pickering a moment ago and he pointed out that the

silverlining for qantas airlines is the cratering of the price of oil and aviation fuel as well. this oil situation, in your experience, have you seen anything to rival this and how do you see it ending? >> when i was an intern, it was the gulf war. in the past 24 hours have been nothing short of incredible. day it will behe of interest to strategically reengage. it was within all of their interests to sit around the

table in the coming months. having said that they did what they did. it has everybody by surprise it is in russia's interest to reengage. we have more to lose as the year progresses. they expect to price in some of the defaults within that segment with price activity last night. it will depend how long he will continue. that is the biggest issue. that will be dealing with more of an issue.

not a good scenario in any way. paul: indeed not. george, thank you for joining us. let's check in on the first word news. through the revenue first week of march. suffering from the double whammy with group visas and the enclave the indexended stop gaining 5% on sunday. route on wall street has reshaped the landscape all the worlds richest men jeff bezos and warren buffett both saw more than a quarter of a billion dollars wiped away while asia's most wealthy man lots almost $6 billion.

remaining democratic presidential candidates returned . joe biden would aim to sinceidate the lead tuesday. it will be the first chance that voters have to decide since the contest. seenic politics has now two rivals declare themselves president. the impasse threatens the peace deal between the u.s. and the taliban and is another headache for washington two decades after the invasion.

this is bloomberg. check in on what is .appening on the aussie market 6%have qantas off by about earlier. capacity.h a flashing at $.66.e dollar to hover continuing over historic lows. italy with the first nationwide lockdown to prepare -- to prevent the spread of the coronavirus. the international agency says the oil price war between saudi arabia and russia is like

roulette with grave consequences. this is bloomberg. ♪ubbin

paul: i am paul allen in sydney. pared losses.ave after president trump's briefing on the coronavirus suggesting that tomorrow and economic relief package will be unveiled. seen s&p futures move into the green since then. reversing theward impressive sell down we saw in equities today. president trump says his administration will discuss a

possible tax cut. washington ism mario paco. >> as you mentioned the president seems to be trying to your out a way to bring economic relief. mentioned payroll taxes but also some kind of relief for hourly workers. >> is this going to be enough to reassure markets? we've seen futures moving into the green. tell at thish to point. the administration, for the better part of a week and a half, has been trying to calm fears and markets and to reduce

virus andhat the dealing with it has been mishandled. the market whether has confidence in his response as he steps up these efforts. left the podium somebody shouted out, have you been tested? and pence says he hasn't isn't sure if trump has. >> in terms of testing in broadly we know that there was a hiccup getting out of the gate. upy talked about ramping production of tests broadly. the president did say earlier in that press conference that he plans to hold another press conference tomorrow following

his meeting with senate republicans. thank you for the update. italy plans to expand restrictive travel bands which makes it the first country to impose those kinds of restrictions across the nation. what can you tell us about these restrictions? >> it is an extension of the restrictions imposed just a few days ago. at the moment, schools are closed and there is also a ban areports events, gymnasiums closed, bars and restaurants have restricted hours. shopping malls will be closed on the weekend.

it is measures to try to slow down the outbreak which is putting a lot of pressure on the system at the moment. we are hearing news of potential stimulus measures being announced in the u.s. tomorrow. to hear fromxpect italy? >> italy has announced they will spend 11.5 billion euros but that could go up toward 10 billion euros. he is also waiting to hear with the rest of the euro zone will do. the outbreak in european countries is slightly behind the accounts we see in italy. progressions show that this is just one week away. detail as these

countries discover more and more cases. we expect some measures there too. paul: still to come, the former u.s. treasury secretary is that a recession in america is more likely than not. this is bloomberg. ♪

paul: this is bloomberg markets: asia and i'm paul allen in sydney. the u.s. recession is more likely than unlikely due to the of the coronavirus.

>> this is not going to repair itself. the epidemic or pandemic is not going to be stopped by itself. the downturn in the markets will not be stopped by itself. in theential downturn economy will not be stopped by itself. come up witheed to a program that is coordinated across the u.s. government, coordinated between the u.s. andrnment and others coordinated with the international institutions. they need a program that is comprehensive that addresses the financial difficulties created by the lack of credit that addresses the need for maintaining demand at a time when paychecks are going to be cut back.

is investment oriented, that is addressing each of the aspects of this problem in some coherent way. we need something that is , andehensive, coordinated coherent, but at this point we are not close to that. are seeing individual measures but they come out of any context, out of any framework, out of any overall explanation. >> we saw the federal reserve cut emergency 50 basis points. it didn't seem to get anything done. was that because it was not coordinated? >> it came outside of any

context, no context of international action, no strategy of u.s. recovery, no strategy of a plan in place for addressing financial actions. fedimpression was that the acted on tuesday because jay powell said on friday they would act and he was nervous that the market was going down. no sense that this was part of working with other countries, working with the imf, working within the context of a set of actions directed at the health fundamentals. president-esque leading economic advisor saying that there is no need for fiscal stimulus, even in the face of monetary policy being out of

wem, and the biggest decline have ever seen in point terms in the stock market. think that these problems can be addressed, that they can be resolved immediately. we don't have that much power over the microbes, but there needs to be a sense that there is somebody with an overall understanding who is calling the shots, in transparent and truthful. paul: that was larry summers. let's check in what is happening in australia on the markets. asx just off to .8%, recovering 1.9% from the earlier losses. qantas has recovered some of its losses.

capacity, the ceo to take no pay. still to come, oil roaring back. more on the commodities .

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can your internet do that? xfinity xfi can because it's... ...simple, easy, awesome. [ barking ] >> do not buy this bit. >> this is not going to cause the program to repair itself. >> many countries are going to be hit. kamil you will see a whatever it takes policy. >> i don't think that this is a micro problem. >> these are signs of the global economy. >> this will sort itself out but not before some further damage. some of the guests commenting on the extreme arc it moves. let's get over to sarah ponczek

for an update. >> it has already been an eventful morning. we've seen in the australian stocks falling more than 3%. still, that decline of 20% is still in focus. there is the potential that those australian markets will .lose nikkei futures pointing to a higher open. still under that round number of 20,000. still also some major fluctuations in s&p 500 futures after an absolutely brutal trading session. since 2008 since tripw circuit breakers after president trump's press

conference. wti crudeound is prices. up to .5%,ti is after falling to its lowest level since 2016. brent, we look at what we did see on monday and how it stood up to history. the worst day since 1991. now you see brent in crude oil $34 a trading around barrel. right now we are seeing a bit of a reprieve. we will see what happens in the next couple weeks. the iea saying the oil roulette is a russian

that could lead to grave consequences. spoke totive director bloomberg about the market challenge. i think this is one part of the equation. the first part we are facing now is major decline in oil demands. as you imagine the epicenter of the coronavirus is in china. number one trade partner of more than 100 countries around the world. more than 80% of the global oil -- whatever is in we seelobal economy, global oil demand is declining. it is our expectations.

even before the so-called price war has started. the firstreseen quarter this year 3.5 million per day of a surplus oil in the markets. these things coming together low of 3.5 plus overhang million in the markets and on top of that, key producers have said they give a big push in the .rocess now,ng at this situation that they actors say do this to kill shale oil.

this may prove to be right in the short term. our expectation is that the growth in u.s. shale will slow and maybe decline. temporary.y be again and again, the shale industry has proven that it came up from the increase in processes. and we have to think what will in the oil-producing economy such as iraq and nigeria. iea executivethe director. our next guest sees a tug-of-war between liquidity needs and demand.

suki we have seen some big moves in gold, what is your price target? >> i think my gold price is seeing some of those games but 2-2, and weing expect what we last saw in 2012 come up with a quarterly average of 1725. do see the spot price easing off the moment. is that indicative of the demand for liquidity that you described? inwe are seeing gold hold two directions at the moment. investors need to turn to high-quality liquid assets. particular that we have seen such's sharp gains. dothe near term if we continue investors contain to turn to.

i think there's plenty of scope for investors to add to their gold exposure. >> we've seen some interesting moves in gold miners. volatility, you would like to think with some of the import costs but there might be more upside there. what are you seeing? ofif we look at the cost producing gold, the cost of production has fallen whether it has been a function of the dollar playing that role or lower energy costs. the average cost on a global basis is below. we seen a wider cash margin for a number of producers. strong equitythe market. we could start to see gold prices really taking off.

paul: we do have a chart that indicates some powerful expectations around the next fed meeting of 55 basis points of further easing being priced in. how important is it with the fed does next? can we do think it's going to be key for the next move higher. especially the correlation between five-year yields. that is the strongest relationship and it is likely to see investors continue to turn to gold. we are forecasting the fed to move in march and april. expectations of further monetary easing expecting investors to continue to turn to gold as we look for what can benefit them and that negative yield. >> the curiosity of all of this has been what is going on with

the silver price. if we look at the silver to gold ratio, it really a departure from historic norms. what is the chance of silver playing catch-up? >> silver is interesting given that it is not quite plain the same role that it is with gold. on the one hand is a precious metal, we do sometimes see silver benefiting on the back of a positive move. alongside the rest of the base metals. we seen silver prices coming under pressure. china is a large consumer of silver. we think the silver market is likely to be oversupplied. we are seeing that ratio rising to levels that we last saw and 91. the nurture -- in the near term it's actually like following in the footsteps of the other base metals. paul: but it is cheap relative

to gold. continues, can you imagine a scenario where it might break out? >> we have seen scenarios in the past like following the global financial crisis. it was eventually followed by a move higher with silver. you tend to see on the retail side at if investors feel they are priced out they turned to silver instead. silver etf holdings have done quite well gold etf holdings or record high. we are seeing inflows. shysilver etf holdings are of all-time highs. we do anticipate prices and silver and stocks to move higher as the year unfolds. >> i do want to get your thoughts on platinum and palladium, both of which have

seen a huge run-up before. where you see the price for those heading now? they have two different sets of fundamentals. hand platinum market will be oversupplied. the palladium market we forecast to be vastly undersupplied. even though both markets are we think be impacted, the palladium market is going to be undersupplied. in the near term as concerns around auto manufacturing and the loss in palladium demand are priced in we might see a slow down palladium prices, but thereafter we see strong fundamentals. with platinum, even though we

see it impacting it a significant amount, despite this we see that the market is still going to be oversupplied. very consumer based demand but overall the fundamentals look quite weak. thank you for joining us. let's check in on the first word news. >> italy is ready to extend travel restrictions from the north to the rest of the country . more than half of the nations in the world have the infection with cases in spain a most doubling. the world health organization is stepping up its warning as the threat of a pandemic is increasing. asia is entering fair territory. am another the virus has

foothold in 70 countries. the threat of a pandemic has become very real. the first pandemic in history that would be controlled. we are not ate is the mercy of the virus. forxpanding capacity cuts the third time in three weeks. the will bef 12unded with just two of budget conditions are also trying to backup. delaylso went airbus to orders of the 350. led zeppelin have won an appeal

that they did not steal the core rift of stairway to heaven. the court said that they did not take a vital series of notes from a song called spirit in the late 1950's. global news 24 hours a day. powered by more than 2700 journalists and analysts in more than 120 countries. paul: still to come. , the imf market uproar chief economist says fiscal policies and the driving seat.

paul: this is bloomberg markets: asia and i'm paul allen in sydney. will get a quick check of how we

are looking at markets on the moment. hot off byelling only half of 1%. we are awaiting news on a stimulus package in the u.s. tomorrow. crude prices higher as well. all i will say about that is volatility. to more on global stimulus. a chief economist of the international monetary fund. let's get her take during the stock fall off and what was a plunging oil market. >> this is a health crisis with significant economic impact.

growth will be lower than 2019. already the weakest in 10 years. there is a need for action, substantial targeted policies. think ofase you could fiscal policy is being of the driver seat. that's the way that you can do a lot more targeted policies. they're all for fiscal authorities and regulators. togeted policies tailored particular sectors. >> what is the imap doing to facilitate the coordination of these measures. your calling for something core native. from individual governments at a time when there isn't a lot of appetite for countries to work with each other. the level of distrust is higher than it has been in decades.

>> we play an active role. we are in constant touch with our members to see with their needs are. recently had a call with the imf-esque about governing council. where we discussed different policies. that countries can undertake. there is a court nation action being taken. it is the case that central banks are speaking to each other and figuring out what needs to be done individually and globally. there is momentum building up and we are in there, we are supporting the buildup of this momentum. prices you look at oil is it a net pocket of or a net negative? >> when you look at 2014 when there was a global place -- global price collapse it was a net negative. the big negative effect that comes from oil exposure seemed

to dominate. overall it was negative and it could be that way too. the bloomberg chief economist speaking to us. scott morrison says the coronavirus on the economy could be worse than during the global financial crisis a decade ago. kuroda joins us now. we were hoping we might hear something from the governor this morning but it is coming. >> we expect that the fiscal package will be on the order of 10 billion. the prime minister this morning suggested that we should expect the package to be announced later this week. it is expected to be a targeted and measured response that is keeping people employed and businesses operating as usual. tastegested that brought

tax cuts should be ruled out. australia is expected to benefit on the other. handouts are cash similar to those that were received following the financial crisis and the should be ruled out. paul: also said it would be scalable. how did the growth trajectory look in australia? they are now predicting a recession. >> that is correct. chinaikely emanating from . creating airus is real possibility for this. we are seeing the well betweened channels tourism and supply chains and now we are seeing the indirect

effect and uncertainty among households as the number of cases in australia are increasing. ons is expected to weigh half of consumption as people refrain from eating out and socializing. a real possibility that we will see two negative quarters of gdp. came out how about monetary policy. unconventional measures we are talking about. what are they going to look like? commit money markets expected the rba will deliver another push of any five basis points in april. last week, the conversation seemed to evolve that the rba measure of unconventional policy would be the yield current control.

this allows that the rba doesn't necessary have to expand its balance sheet. but the market could move in the direction that it sets from that announced -- amount alone. we expect that we will hear more from the rba on its preferred measures in the coming weeks. paul: thank you for joining us. futures pointing to another day of losses. we will preview the market open in tokyo up next. this is bloomberg.

paul: this is bloomberg markets: asia. markets open in tokyo and seoul at the top of the hour. go to sophie for what to watch.

pointing lower while u.s. losses ontes earlier that -- we have fears hovering just below 103 against the dollar. it is a choppy report this tuesday. advancement on monday. japan and australia it will be nearng that markets all-time lows and that may test appetite. arelators and south korea stepping up measures to stabilize markets. this includes widening the criteria for stocks that have been designated as overheated due to shortselling. they are to take effect

wednesday. thank you so much for that. let's just check in on how we are doing on asian markets right now. has recovered some of its earlier losses. there were quite a few stocks in positive territory. a couple energy companies performing quite well, and gold stocks are among the heavier decliners here. volatility continues to remain the name of the game. qantas recovering from some of its earlier losses. this after announcing that it would/capacity by 23%, scrapping keep $150 billion in dry powder.

chicago futures are in positive territory. still to come in the next hour thisoomberg markets: asia, economic president will give his outlook on the global selloff. this is bloomberg.

morning, i am haidi stroud-watts in sydney. welcome to "bloomberg markets asia." our top stories this hour. a perfect storm, markets slump again with a drop in oil and the coronavirus. the biggests take head as demand for crude falls again. russia and saudi arabia face off with vowing, no surrender.

italy has locked down the whole country over the coronavirus. the world health organization warns a pandemic is near. let's get you straight to the market action with the open of trading across asia. sarah is in new york for us. are we seeing any green shoots or gold attempting to regain control? sarah: we have seen a slight change in sentiment, after president trump took the podium and said he would announce dramatic measures tomorrow. as japan comes online we see further losses. the nikkei to do five yesterday closed a little over 20,000 for the first time in over a year, now extending losses. the topix at the lowest level since 2016. we see the safe haven bid moderating. the japanese yen, the worst-performing currency. after we saw dollar-yen move toward 100, now back above 103.

now the same story for jgb, after falling to -20. korea coming online, too. we also see some pain and the kospi heading lower, below the round number of 2000. at the same time, australian stocks have seen massive fluctuations this morning, one point off more than 3%. now off 0.7%. the prime minister said he could see the coronavirus having a larger impact on the australian economy than the global financial crisis. not encouraging statements from the prime minister. across the region, kiwi stocks having the worst performance. they had the worst day since 2008. 1.8% after aes up decline of more than that amount. this, after the worst day in the

trading session since 2008. i want to circle back and take a look at australian stocks. asx 200, because we have seen massive fluctuations. we hear the phrase you take the escalator up in the elevator down. that is what we have seen. the asx 200's trading 20% off of those highs. that slows down the amount that would signify but 20% bear market level. not only have we wiped out 2019 gains, we are off 14% this year after seeing gains earlier. that 20% level is in sight. something to pay attention to. back to you. haidi: psychology is where it is at the moment. we are getting pretty bad kiwi data. the new zealand consumer confidence index a contraction at -53.

outlooke preliminary index, a contraction of 12.8. these are early readings of business confidence in new zealand. it is pretty shocking. the kiwi dollar trading at 63.25. kiwi stocks have taken an absolute beating. we are seeing downside when it comes to trading in new zealand off by 2.8%. let's get views on this market turmoil from our next guest, prestige economics president and chief economist, jason schenker. great to have you. we did not see oil give back losses, though huge amounts of volatility still in terms of the pricing action in crude markets. how long does this last? is this a short-term strategic gain between saudi arabia and russia? or do you anticipate this chaos will go on for quite some time to come? jason: we could see this go on, that is for sure.

a lot of uncertainty around this. there was a hope we would get a deal with opec last week. the russians at the last second, no dice, and now we are in this situation where saudi response to that to ramp up production, drop prices. this could continue on for a bit. the company is really hit our u.s. shale companies where debt is a risk. that presents risks through shared national credit, potentially through the entire u.s. economy, which is something that happened at the end of 2015. a contagion affected the entire economy. see brent crude rising as much as almost 7% in london. we are seeing this short-term bounce. in terms of the impact you are watching out for, is the sound

of forecasts, revised forecast, being ripped up by analysts the world over? what are you watching at the moment? everyone is struggling to call where the bottom of this market will be. jason: i think people watching right now, the first thing, what is going on with the coronavirus, local manufacturing? people will be watching for any manufacturing data coming back online. manufacturing will be kicking back up. and, what happens with saudi and russia? at the end of the day what triggered prices being ready to saudihis low is not just arabia and russia, but the fact that oil demand rose so sharply. china is the biggest net crude importer in the world, the biggest net marginal consumer of crude. growth has been shaved off there, the economy has slowed.

major factor that drives crude oil prices during the year. if the coronavirus spreads in the u.s. and we get quarantines like in italy, that could sap summer driving demand. haidi: if this is a political problem and political move being taken, there is a political response to this, right? does that give you hope that this has the potential to be a short-term problem, the uncertainties we know continue to play out through the coronavirus? jason: there might be some potential for prices to go a little higher, but i think part of the reason russia backed out of the deal at the end of last week is because as there was talk of a deal, as opec was moving toward a deal to cut oil production, and now we are going to extend that cut further out, oil prices did not rally.

if anything, an agreement between saudi and russia could maybe bring oil prices back to where they were last week. they might spike above that. eventually, they would probably settle back down to where they were before this deal, which is still a low price which puts oil and gas, especially in the u.s., shale companies that might be leveraging, that could be a huge problem and hit the entire u.s. financial system and that has ripples throughout the entire economy. haidi: jason, i want to move to opec. in the meantime, a breaking news headlines with the japanese cabinet approved a state of emergency. we also heard from the minister of finance a few minutes earlier, saying continuing to watch the currency markets with urgency, and you would imagine, a great deal of concern, considering the strength we have seen in the yen.

we are also just getting coronavirus updates from china, reporting 19 additional coronavirus cases as of march 9. the total confirmed rise -- cases rising. 17 new coronavirus deaths on march 9. reportingce of hubei 17 new cases on march 9. we are seeing a stabilization picture coming out with the spread of the virus in china. the rest of the world grapples with the spread elsewhere. what does this mean in terms of your favorite currency pairings at the moment, the dollar yen for example? jason: the fed is in an accommodative mood, but they were accommodative last year and the dollar still went up to read as we look at growth rates, the u.s. is probably going to have one of the strongest if not the

strongest among advanced economies this year. that will still keep the dollar relatively strong. fed's balance the sheet through the rest of the we should be watching for not just a rate cut, but mortgages. if we look at the size of the balance sheet compared to the economy, it is smaller. strong,ar may remain but we should expect modest dollar weakness during the year, as the fed becomes more accommodative. jason schenker, thank you so much for joining us. let's get you to first word news. >> growth gaining revenue in macau, 79% through the first week of march, extending february's record slump of 83%.

casino resorts suffering from the double whammy of individual and group visas, as well as widespread disruption to transport. 5%, your today 21%. wall street has reshaped the landscape for the world's wealthy. jake bezos and warren buffett lost more than $4 billion, wiped away. lost the most wealthy men almost $6 billion. energy moguls are taking the biggest financial hit in a new price war. remaining a democratic presidential candidate, returns to the fray later tuesday. joe biden will aim to control the lead he won super tuesday while bernie sanders hopes to repeat his michigan victory of four years ago.

it will be the first chance to decide the contest narrows to a two horse race. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. haidi? haidi: a lot going on in the early part of the asian session. japanese sessions extending losses. the nikkei two to five down by over 3%. that market trading at the lowest since april of 2017. just one of the markets following into -- falling into bear territory. a bill has been passed in japan that enables the passing of the declaration of an emergency. the bank of korea saying after their governors meeting, loans, open market operations, to help small and medium-sized enterprises. they are also closely monitoring fx.

they will take the possible and necessary steps to ensure financial stability. all policy tools at the ready to stabilize markets. to recap, a reiteration of the slowdown in the number of new cases and fatalities in the coronavirus situation in china. china saying hubei had 17 additional coronavirus cases, 19 nationally, and the number of .eaths, 17 cases in hubei a slow down in terms of the spread of the virus in china. but the concern is now across the rest of the world. this is bloomberg. ♪ rld. this is bloomberg. ♪

haidi: this is "bloomberg markets asia." i am haidi stroud-watts in sydney. cautiously optimistic tone around the latest coronavirus as

the numbers fall within china. they say we have seen the peak in china, or at least one. >> now we have seen a definite decline. this weekend there has been a milestone in which china nationally reported less than 100 cases and the next day, less than 50 cases. peakindicates at least one has passed, but it is no guarantee it will remain so and we have to remain vigilant. there is no room for complacency while the viruses circulating anywhere in the world. next danger are the points you would be looking at closely? particularly as a lot of the country, 60% to 80%, is coming back to work and going back into communal spaces. what is the risk of reinfection?

you rightly indicate the concern to economic activity has to be closely watched. of course, there is every indication this can be done and we are seeing how different grading of emergency or risk levels is being done in china with a very wide range, four level grading, where there are low risk provinces and high-risk provinces and the return to economic activity is being carefully watched. point. a very important facesrse, many of the new being identified and reported in recent days have been imported from other countries now facing the epidemic and therefore, that

sureother possibility for -- resurgence. looking for the potential reimportation are two major points of vigilance. thei: in fact, i think in monday numbers, the early cases werede hubei province imported from iran. is that a hot spot where you could see further community transmission? where else would you be looking at and is there heightens concern we could see a second wave of infections? guaden: there was always a possibility of resurgence. the danger is just to identify one country. it is important to be looking at all the places where there is community transmission happening. headquarters has published a long list of affected countries.

remains with the same advice, not to do travel bands or trade restrictions. it is about showing vigilance. who's chinawas representative speaking earlier this week. the number of global covid-19 cases has passed 110,000. let's get more from selina wang in beijing. the who, are they any closer to calling this a pandemic, as we see numbers slowing in china? selina: you are seeing a dramatic slowdown in the number of reported confirmed cases in china. just 19 new confirmed cases today, that is a dramatic slowdown. but globally it has spread to 100 countries, infected more than 100 thousand people, yet the world health organization is refraining from officially calling this a pandemic. they want to focus more on

containment efforts and not spread panic, given containment has worked in china and south korea. you heard from the world health organization's representative that cases reached a peak in china, but risk resurgence remains high. you see cases imported into china from other parts of the world. in beijing we saw several instances of that over the weekend. just hearing what the who china rep had to say, he was talking about the dangers of school reopening, factories going back to work, workplaces resuming. what is the main fear for authorities in china? selina: you are seeing cities put in travel codes on overseas arrivals. they also asked major cities like beijing to put in place stricter border checks and quarantines. as people resume work, it is a major concern that as there is

more human contact, there could be a resurgence. economic pain being felt continues to ripple with these factories, even though they are coming online, they have troubling concerns with weak demand domestically and overseas. look: coming up, a closer at quanta moving to the downside as they cut capacity further so they could go deeper on the coronavirus impact. this is bloomberg. ♪ ct. this is bloomberg. ♪

haidi: this is "bloomberg markets." i am haidi stroud-watts in sydney. expanded capacity cuts and said they could go deeper. this has escalated pretty quickly from the start of the coronavirus impacts. >> it has. servicesantas, cutting

. this goes deeper than the previous two cuts. it is cutting 25% of their services on international flights. today we saw that wide reaching reduction into the u.k., into the u.s., u.s. west coast from australia. with theught up airlines the last fortnight. they said there had been a significant hit to demand in the last fortnight. things have really gotten real. european countries take hold and the u.s.. that has ended travel demand. people are concerned about flying not just in asia, but europe and the u.s. that is why we saw qantas take this action. haidi: how well-prepared is qantas to take a hit? the leader has run a pretty tight ship. isit is fair to say qantas

better prepared than many airlines. they have recorded record profits in recent years, one of the most profitable airlines. they have the margin to take a hit. they also have spare cash. they canceled stock buybacks. they are doing all they can to save money. qantas is well-equipped to survive this. it also grounded aircrafts. it can go deeper. there will be other airlines that will not get through this. we have been talking about that for a long time. pricesusually when oil collapsed we talk about the benefits to airlines. doesn't matter at this point? angus: at the margin it does. but they are not fully exposed to the downside.

is fully hedged, it can benefit to a degree from cheaper oil. if you are not sending your plane's up in the sky, it does not make any difference. we have seen this escalade the last fortnight. all the u.s. carriers cut capacity. we have had casualties in the u.k. this has escalated very suddenly. there is probably barely an airline on the planet not affected by this. haidi: thank you, with the latest on qantas. let's get you the latest business flash headlines. widespread declines as oil moves into a price war. exxon mobil tumbled the most since october 2008 as investors await the fallout. global demand for energy was falling before the coronavirus outbreak. the rift between the saudis and russians, created a slump in

markets. bank questioned its readiness for a slump in the u.s.. the company has forecasted earnings between 5.6 and $6.6 billion, but failed to include impact from the coronavirus. a quick look at japanese and korean markets. we are seeing the downside of 3.4% for the nikkei 225. that is one of the many asian markets that fell into bed territory this week. this as that emergency bill is passed through the japanese cabinet, enabling the government to declare a state of emergency of the coronavirus. kospi limiting losses, 0.6% lower. but we see extended downside when it comes to trading in sydney. it is fair to point out, trading in sydney, well off the session lows earlier. we anticipate the government will be announcing a stimulus

package to combat the coronavirus. new zealand still bearing the brunt of the selloff at 2.8%. lots more to come including the latest on markets. this is bloomberg. ♪ this is bloomberg. ♪

haidi: we are looking at downside when it comes to trading in sydney. it aussie stocks are awesome of their session lows. the details of the stimulus package. or data crossing the bloomberg. -- more data crossing the bloomberg. a rating of zero from a prior rating of three. is nest confidence from the month of -- business confidence from the month of february contracting took four. both confidence and conditions claiming this month after what period of stability. surveyed, no those

impact today. impacts expectations the will be worsening as we get into the february and march reading. we had consumer confidence survey. to thelved the most lowest since may of 2014. let's get a look at the markets with sarah ponczek. sarah: it has already been an eventful morning session. the japanese cabinet passing a bill that would allow shinzo abe to declare an emergency. they are planning to use tools such as loans and open market operations to help small and medium-sized enterprises. the nikkei below 19,000. the kospi below 2000. s&p futures are holding onto gains after the reversal we saw

after president trump took the podium and said he is going to announce the major measures tomorrow to support the u.s. economy. we are also seeing oil rebounding to the upside. this comes after what was the worst day since 1991. nice a 25% decline, it is to see wti crude oil and brent oil up more than 4%. it is not put much of a dent in those two day moves after a 25% decline. we see the safe haven bid for gold moderating. gold falling for the first day in four. we are seeing the safe haven bid moderate, particularly with dollar yen. after seeing dollar-yen move towards 100, we are seeing at move back towards 103. we do see the aussie dollar holding steady. we now see treasury yields heading higher. the 10 year now at 63 after

falling towards 30 basis points. the thirty-year back above 1%. haidi: sarah ponczek in new york. we will have another look at the coronavirus damage when it comes to china's economy. we get the cpi numbers in about an hour. seem to bee prices something to deflation territory. consumer price gains are expected to be muted. joining us is the crtc managing director and economist. it was a brief period out of deflation territory. to swingk tti is going back to negative territory to -.3 and .4. it looks like we are set up for a larger fall in march. ourshould be higher than

previous expectation because of of foodrtened supply supply after chinese new year. what are we expecting to see? it is unprecedented, the disruption and impact of coronavirus related slowdowns and also acceleration in some activities. will we see spikes in certain parts of the basket because of the associated cost of transport of goods and foods during the locked down the country? eva: that is aggregate level. that was still about one fourth of the normal logistics activity around chinese new year versus other years. we would say it is still throughout the country, pretty muted in terms of transportation activities and production.

haidi: when do you see a recovery? is the concern now particularly that in addition to weak domestic demand, you are seeing the weak global demand pull through after a pullback in trade as the rest of the world comes into recessionary conditions? eva: china and the rest of the world are one or two months apart. china plunged into a -- much earlier. because of it, we were able to contain the virus on a relatively successful -- relatively successfully. we are back to 60% capacity utilization. as of this morning, a new reading is now at 76. that compares to 20% after the chinese new year where all

activity across the country was locked down. to recoverya path and demand. it may be hit by a second wave. italye already seen lockdown the whole country. the virus spreading quickly in europe and the middle east and escalating in the u.s. as well. we are seeing a second hit from a slowdown may be at the end of march towards all throughout the second quarter. the rest of the world as well. from now, the data we are seeing as how it severed a little bit from china supply chain lockdown. onward,nward, -- later a synchronized decline because of their own containment measures and uncertainties of the financial market and so on. haidi: it is that double whammy that when the supply chain gets

back on board and the global demand side is seen to be falling. what then do we expect from the pboc in terms of what they would be watching for the next policy tool to employ? are i think globally we seeing a little bit of synchronized move toward fiscal reasoning. this coronavirus induced slowdown was a simultaneous slowdown of supply and demand. a lot of the governments are opting for fiscal stimulus options when they have one. china, throughout -- we estimated that broadly defined including all of the government agencies, broadly defined fiscal deficits might have expanded by three or 4% year to date in the attempt to boost the economy amidst the disruption from the virus. pboc will do its part to provide

liquidity and to support. we will probably see more rate cuts. in terms of lpr and a very high probability for a positive rate cut despite a higher headline cpi than usual. we will see a step up in open market operations and potentially another rr cut. before the end of the second quarter as well. pboc: how closely does the need to follow the fed given that a 75 basis point cut is praise in for the meeting? the march 14in for meeting? eva: they do want to keep the volatility. it is not the most concerning policy because the fed monetary mechanism, which is to altered the price in hope of

changing the volume of supplier liquidity. in china's case, china had a hybrid system where they can change the price. at the same time, they can guide the price up and down. to its commercial banks or even to government bond issuing and so on. these are more flexible in china. more toll definitely do support money supply and credit issuance, especially on the government fund. the rate cut will be more muted than what the fed did, partly because of a bigger arsenal of tools. think of margin does not support much higher growth if they cut it even more. it would make the banking system suffer a little more. we need to balance these concerns. haidi: thank you for joining us. cicc managing

director and senior economist. a chief global economist will also be long with us. -- b along with us. >> italy is ready to extend travel restrictions from the north to the rest of the country as cases of the coronavirus soared by 25%. more than half the nations in the world have the virus now. the world health organization is stepping up its wording, saying the threat of a pandemic is increasing. entering territory. has a that the virus foothold in so many countries, the threat of a pandemic has become very real.

first would be the pandemic in history that could be controlled. the bottom line is we are not at the mercy of the virus. >> the remaining democratic presidential candidate return tuesday as six states hold primaries. joe biden will aim to consolidate the lead he one on super tuesday well bernie sanders aims to repeat his michigan victory four years ago. rock ledge and led zeppelin have won an appeal that says they did the musical rift at the heart of stairway to heaven. in favor of jimmy page and robert plant. the pair did not take the series of notes from a song by a california been called spirit in the 1960's. global news, 24 hours a day, on air and on quicktake by

bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. thank you. as we go into a break, let's take a look at how asian markets are trading. of therkets are coming session lows. not so for japan despite the strength we have seen in the yen. between s&p the gap futures and trading in the nikkei 225. the cost down by seven tens of 1%. we are getting news of an emergency bill being passed by japan that would allow the government to declare a state of emergency. we are hearing from the bank of korea they are keeping a firm i on trading fx and markets. tools to employ all stabilize markets. in australia, we had a poor reading and it came to consumer

sentiment kid also matched by business sentiment. watching out for the details of the fiscal package from the morrison government. new zealand, we are seeing trading to the downside of close to 3%. lower than november 2019. in the meantime, we are seeing something of a recovery when it comes to bond yields from treasuries to japanese sovereign yields. we are seeing some gains for the first time in days. lots more to come. this is bloomberg. ♪

haidi: new zealand prime minister -- new zealand's finance minister has been speaking to bloomberg, some of his thoughts on conventional monetary policy. starting off by saying thanks should be passing on any rate cut.

banks are getting close to the point where they would be considering quantitative easing and other extraordinary measures. the minister is setting unconventional monetary policy is unlikely in the near term. saying the economy may now be growing much in the first have but it has room to move further. really urging the banks to pass on any cuts to customers is something we have heard from governments in new zealand and here in australia. in fact there's too expect -- the reserve expect bank of new zealand to cut more. and visitorsprices as well as agricultural and other trade. bradley hampering the new zealand economy. -- badly hammering the new zealand economy. let's bring in joanna who joins

us from singapore. what are we watching as we get market aftermarket capitulating into bear. there may be signs of a stabilization as we see bond yields start to recover and at least some asian markets trading of their session lows. general, there was such a bad day yesterday that markets are taking a bit of a breather. you do have the concerns in emerging markets still. we have seen some tenuous economic data. we are watching to see if there will be more fiscal programs. the oil news over the weekend was not necessarily great for countries like malaysia and some follow through with anthony zhou with palm oil prices. with palm oilsia prices. haidi: in terms of places like

indonesia and the philippines, why are there that much concern given that on the surface, from official numbers, we have not seen as much of an impact from the coronavirus. em as anhinking about overall asset class, one of the issues as investors look where the pair back risk, there have been outflows this year and recently. if you're looking broadly, that is one of the first places people may be concerned about. then there is the regional contagion. china is such a big player. if you have a shutdown to parts of the chinese economy, places are going to follow through. definitely a lot of uncertainty with the emerging markets in asia. haidi: thank you. our cross asset team ahead of the market open in southeast asia. coming up next, hong kong

schoolchildren will miss at least 13 weeks i have a -- 13 weeks in classes. this is bloomberg. ♪

haidi: this is bloomberg markets: asia. children in hong kong have not been to school since january as part of government measures to contain the spread of.

the coronavirus the latest return date is april 20. let's take a closer look at how this is affecting families and schools. educationof consultancy. great to have you. this is impacting you in a personal way, right? >> correct. i have two school age children. they are teenagers. speaking as a parent, shall i just say we are becoming very weary and we are over it. what kind of strategies have you put in place to get through this to make sure they are getting an education? haversonally speaking, i two very different children. one of them was quite fine. the other one that was not it is not ideal.

it is far from ideal. haidi: what has been the experience then of some of your clients and the people you have spoken to who have been in similar situations? ofcdotally, i have lots friends who have come back to australia and put their kids into local schools until some emergessee emergent -- currently cut -- emerges. >> schools are remaining closed to the 20th of april. whether or not the schools will reopen, hong kong announced they will not resume in person classes at all for this academic year. university is different from school. it remains to be seen whether that will impact the education schools.decision on we hope not. anecdotally, parents have taken children -- if they have a home

country, they have had that option to take them back to the u.k. of parents are trying to stick it out. it is really hard going. it is also a lot of money. hong kong school fees are extraordinarily expensive. i'm wondering how the schools are dealing with it from their side. online forums -- there are 28,000 members. starting about how parents are asking for whether or not there will be any refunds on fees. i doubt it to be honest. in fed from the school's point of view, there is no room for them to issue refunds. there may be some room for credit for some things like or certainities

other peripheral fees, but we are not expecting refund from tuition fees. parents are withdrawing children with no notice. there will be a lot of nonpayment of fees or late parents havee withdrawn their children. have you seen any evidence this is a catalyst for some ex-pat families to leave hong kong? we have heard that from relocation agents for example. >> yes, although it is hard to say this is the only factor that is driving parents out of hong kong. i feel this is the last straw. do not forget that international schools are not populated by ex-pats.

the majority of children who are studying in international schools are not ex-pats. hong kong is perhaps quite different from international schools in other countries. temporaries -- families who were temporary here, the decision to move back or support rails has accelerated. has accelerated. haidi: how well prepared have schools been to deal with this kind of impact? >> that varies. school has slightly different interpretations of what they believe to be online learning. it varies from age and stage. --ot of kindergarten parents we run a poll on our facebook page. the level of dissatisfaction among kindergarten parents was extremely high as compared to the level of satisfaction for

primary or secondary parents. delivering online learning for three and four-year-olds is quite ridiculous. somewhat more successful for the older children, but it really varies. i feel the schools were not prepared. the last time this happened with when online learning was not really a thing. the schools are scrambling around to put in place this contingency plan or perhaps they could have been thought about previously. haidi: thank you so much for joining us. is leading stock losses in asia. we are hearing from japan's finance minister that the economy is not at a stage where all things are hopeless. sophie is monitoring the markets out of hong kong. what are you seeing? >> not much optimism.

up hedging ramping against stock losses. stop option that's have jumped to the priciest levels in years in south korea, japan and australia. may join regional counterparts in their market territory -- in bear market territory. chinese futures pointing higher. we wait on chinese ppi data. haidi: thank you. hour, up in the next equitys chief global strategist sean darby's is here with us to talk all things market. this is bloomberg. ♪ tv just keeps getting better.

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haidi: it is 9:00 a.m. in beijing. come to bloomberg markets: china open. we are counting you down to the open of trading in the chinese mainland and hong kong. markets slump again as the virus soars. president trump trails measures to tackle the infection. russia and saudi arabia remain at odds with moscow bowring -- moscow bowing no surrender. leavesg demand for goods factory struggling to survive.