paul: good morning. we are counting down to asia's major market open. shery: welcome to daybreak asia. our top stories is our. asian markets face an uncertain star after wall street faced on mounting concern about new virus infections. traders are worried about the prospects for recovery. global cases surge past 9 million with several u.s. states reporting record numbers. california breaks its record for new cases for a fourth day.

several areas we consider planes to reopen. optimistic.emains treasury secretary steven mnuchin says he expects the session to end this year with another stimulus program in the pipeline. paul: we are about an hour away from the open here in australia and tokyo. let's get a check on what we can expect for the new trading day with sophie in hong kong. sophie: asian stocks looking at a muted start this wednesday. this after we sell stock gains fade into the close. check out what is going on with qe markets. the qe dollar is trading ahead of the rbnz decision. in the bond space, we are seeing five basis points this morning. the central bank of new zealand seen holding pat. that is one of the items on the agenda we are watching with

market very much in wait and see mode. plenty of firepower being amassed in deal space the latest news of kp are having pulled together $10 million. let's jump into the turn will. -- the terminal. we could be seeing positive mental for asian stocks. as you can see on the chart, the 50 day line, that has crossed above the 100 day moving average. the msci asia pacific index forming a so-called golden cross. the last three times this happened since 2017, stock gains have followed for asia. shery: new virus cases are continuing to soar across hotspots in the u.s. daily infections reaching new highs. in california, texas and arizona, threatening to throw the reopening process into disarray. top infectious diseases expert anthony fauci told lawmakers he is concerned by the spread. >> we are seeing a disturbing surge of infections that looks

like it is a combination. one of the things is an increase in community spread. that is something i am quite concerned about. you know that. this is something that has been in the press the past couple of days. shery: our bloomberg opinion columnist is on the line. he covers health, biotech and pharma. it feels like long gone are the dailyhen we have these virus updates from the coronavirus task force. in the white house, we have heard from top health experts that they have not met with the president in more than two weeks. we have any more updates on who will take the charge in the ongoing coronavirus pandemic? on ae answer unfortunately national standpoint is maybe no one. you can see how we had not heard from many of the nation's public health experts in a big public way for a while until the house hearing today.

that highlights the fact that the response -- in two many ways -- in dose -- in too many ways have been left to the states. areas. outbreaks in many just reflecting the fact that there was never a coherent national strategy, never a coherent contact tracing program. stateswhich left the under for the difficult task of reopening their economies. reopening,rms of the however these new outbreaks affecting the plan -- how are these new outbreaks affecting the plan? >> i think it is going to make it difficult to proceed with any loosening of restrictions or starting of new business any areas that are seeing further outbreaks. one just because they do not want to accelerate a trend they are still trying to understand

or bring under control. secondly because actually, loosening restrictions at this point probably would not have much of a positive effect on the economy. you would have people potentially returning to work because there are economic demands. rather unlikely people will go out and shop and go to restaurants at the rate you might hope given that there is active community spread in many parts of the states. shery: just give us the latest when it comes to progress on some treatments. we have heard a lot of remdesivir. are we making any progress on this front? >> you know, the latest major update was from dexamethasone. more detailed data from the recovery trial in the u.k. published this week. it pretty much backed up the initial press release that it is a medicine that while not

especially effective or deleterious for people in early stages of illness can be hippel -- can be helpful for people on ventilators. in terms of ongoing efforts, the next things to look forward to our further data -- forward to are further data. target theies that coronavirus. there could be a bridge therapy between what we have now and a vaccine. in the future. those trials have started up. hopefully data over the summer. possibly in the best case scenario, and approval of what could be effective medicine in the fall. paul: thank you very much. treasurycome, u.s. steve mnuchin says the economy will be out of recession by the end of the year and another stimulus package is in the works. another big interview later this

hour. the singapore senior minister tells us how he is tackling the virus crisis. this is bloomberg. ♪

>> you're watching daybreak asia. to act in the world's best interest has plummeted. the poll shows that just 23% trust beijing to act responsibly on the global stage compared to 52% two years ago. confidence and a xi jinping handle world affairs is almost halved to 22%. president trump does not bear much better. meanwhile, reports from north korea says kim jong-un has put any potential luke perry action against the south on hold. the news agency says he met with leaders. the agency also said he

discussed how north korea could bolster capabilities. tension on the peninsula remitting hi. his sister has warned the north could include the army. twitter has hidden a tweet from president trump for violating policy. referring to a no police area in seattle where the president hosted a morning there will never be such a zone in washington, d.c., adding protesters would be met with serious force. twitter said that threat breaks its rules. the tweet is hidden and users must click to reveal it. granted ceo has been bail at $5.7 million. one of the largest amounts ever posted in germany. he turned himself in to police as probes intensified into the two-point wimbley in dollars that went missing from the fintech company. fors being investigated market manipulation. 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.

i'm karina mitchell. this is bloomberg. treasury secretary steven mnuchin -- thanks u.s. will be out of recession by the end of the year. he told bloomberg a new package could come as early as next month. >> we had an unprecedented response on a bipartisan basis. there is no question that money is having a major impact on the economy. whether it is the ppp, which impacted 50 million workers or whether it is direct payments of over 160 million or enhanced unemployment, this is an important part of protecting american workers and is nice. i actually just left the senate republican lunch.

we are beginning to discuss the different aspects of what another bill would look like. we want to take our time because number one, there is another -- a lot of money we have to put out. we have to make sure whatever we do is much more targeted to the businesses that are most impacted. >> do you think it is likely that sometime in july a bill might pass both houses? it's >> i do -- i do. that would be the timing. >> right now, would you say the legislation that you passed is working reasonably well? would you say the fed has done as good a job as you would like them to do? they have a lending program that has not actually lent money. can you say whether the president is happy today or happier today with the head of the federal reserve? >> i think the federal reserve has done a phenomenal job. we speak to them almost on a daily basis. these programs are a combination of work of the federal reserve

and treasury. we have worked very well together. every one of these programs is now up and running. we have a missable bond program. we have a commercial paper program. we have a main street program that is now up and running. we have a corporate primary and secretary -- and secondary. we have a program that lent to banks and nonbanks for ppp programs. the fed acted in an unprecedented response. you have seen the president is pleased with what the fed has been doing. >> in this quarter, we have slipped into a recession according to the national bureau of economic research, which makes the determination. do you think by the end of this year we might be out of the recession? >> david, i do, but the traditional economic metrics are not really appropriate given we shut down the economy. first, let me say there were way too many people that lost their

jobs and got laid off. again, we are not going to be done until we get every single one of those people back to work. i am not really focused on the technical issue of it is a recession or it is not a recession. i'm focused on helping all of these small businesses and all the workers. that is what our job -- and i think you saw the recent employment numbers. people thought there would be another 8 million people unemployed. we put 2.5 million people back to work. clearly this is the ppp working. you sell great retail sales -- use all great retail sales. the economy had a bad second quarter. you're going to see a spectacular rebound off the bottom in the third quarter. >> you are one of the principal negotiators with bob lighthizer on a deal with china. are you confident china can honor the commitments they agreed to? >> i have every expectation they will. they have continued to tell us

they will as recently as last week when secretary pompeo met with one of the senior people that flew in from china. they had a summit. i have that expectation. having said that, why don't we just comment on -- i think the world once a lot more transparency -- world wants a lot more transparency on covid. how did it start, how did it spread? we should not confuse these two issues. yes, we have expectations they will live up to their trade agreements. we also have expectations we need a lot more transparency around the disease. paul: the u.s. treasury secretary steven mnuchin speaking. another stimulus package spurred investors to buy stocks. is the excitement justified? let's ask an investor.

.icole webb is senior investor the stimulus putting more support on the markets. i'm wondering if you're seeing any distortions appearing that give you cause for concern. >> certainly. there is going to be a lot to unpack both for investors and institutional side. up to thedays leading election, there are three driving factors in daily basis. it is the bombardment with covid-19 data. one of the most unprecedented things prior to covid and something i think will change the markets definitely going forward is the openness and instantaneous access to private data. when we look at opentable releasing its dining data, google maps showing us the transient nature and the request for walking versus public

transit, driving maps. monday heels of that, you have unprecedented amounts of stimulus coming into the economy. i do think there is cause for pause and concern. if we go back to the financial crisis, it took us six years to pump in the trillions of dollars we have managed to pump into the u.s. markets in a matter of three months. now we are talking about another 2 trillion on the table. today, we had conversations that shed some light. might be putting more stimulus dollars in the hands of the people in the u.s.. on the very last point driving the markets, is the election. it is really interesting to see where investors are hiding out. some of the storage stocks seem to be just that.

tech, we have of the nasdaq up 13 present. obviously, part of this is investors in the stay-at-home portfolio. do see some evidence tech is starting to act as a haven trait ? nicole: absolutely. when we look at the nasdaq trading 30 times earnings, there should be a pause and a little bit of retrospect to the late 1990's prior to the tech bubble. it is a precarious situation. going back to the stimulus, -- there tends to be a 90% correlation to fed stimulus and investor participation in the u.s. equity market. with that, the safe haven of tech seems to be the only thing people feel like they can rely on. i do wonder to what degree are some of these valuations getting stretched in the storied stocks specifically in terms of, is

there enough real data ongoing to support it? it appears investors are still hesitant to buy into some of the natural positions that might lend long-term in lieu of participating in these dinner fodder conversation stocks. shery: also adding to the uncertainty is the geopolitical side of things. president trump making remarks to a group in arizona saying he stood up to china like no other administration has, that the ink was not even dry on his trade deal when the plague came. overnight, we had the remarks from trade advisor peter navarro that perhaps the china trade deal was over. then we saw this huge selloff. also, a swift rebound as soon as part it in trump said it is in tact. what is that telling you about how much is sitting on the sidelines? nicole: it is incredible. -- old adage that navarro showed is

yesterday. his fast fingers on the twitter handle paid off. we saw that peter navarro suggested in the overnight trading hours the deal was over. there was this massive selloff in the market. all of a sudden, a spike back. all of this cash flowing into the market. what we do see is when there are dips, we have buyers. there is still a lot of cash on the sidelines. i believe a lot of that is coming from the fact that investors believe the only place for capital appreciation is the equity market and the only place for yield is the equity market. those two things in tandem are driving a desire essentially based on there being nowhere else to put money. shery: great having you with us. senior bp -- senior vp a wealth enhancement group. do not miss a big interview ahead. blackrock chair joins bloomberg

tv for the first time ever. that is exclusive in the next hour. coming up next, dell is surging after hours. how it could be planning to unlock value. this is bloomberg. ♪

shery: now to the latest on two companies grabbing the spotlight in extended trading. carnival cruise lines is sinking on another cut to its credit rating while shares of dell computer are soaring. su keenan joins us on the line. let's start with dell enjoying a spinoff of its stake in vmware. su: the corporate computer giant is examining options for its multibillion-dollar stake in the software company vmware. we saw after the bell, shares of vmware and dell.

dell soared as much as 20% after the wall street journal reported the computer company is considering its options, quoting people close to the matter, it says the options include a spinoff or so the stake in the majority-owned company. the journal is saying that dell has recently kicked off a process to explore the possibility of exactly how to maximize the value of its stake and boost the value of its shares. remember that dell was taken private at one point. since its return to the public markets in 2018, a lot of investors have been disappointed the despite the 50% rise in tech heavy nasdaq, dell shares have not reason as much. many market watchers are saying a transaction involving vmware could be engineered to help dell whittle down its $48 billion

debt load. a lot of investors seeming to like the news as we can tell by the major movement in shares after the announcement. again, dell not answering or responding to requests by bloomberg. that reporter alone is causing a big -- that report alone is causing a big move in the stock. paul: we have carnival becoming the latest cruise line to lose its investment grade credit rating. what is happening there? su: s&p flashed the company's credit rating by three levels, a pretty big move. that tuesday move follows moody's cutting the company's -- causing the company's credit rating in may. it makes carnival the latest cruise line company to suffer a credit rating loss due to the covid-19 pandemic. as you remember, there were all those very high-profile videos of those cruise lines going from

port to port at the beginning of the crisis. carnival's recovery will be much slower because it is planning to return in operations, phasing in its return. many of the cruise line ships in many different companies have all been docked for now. back to you. paul: thanks very much for that update. let's get a quick check now of the business flash headlines. 10 weeks -- the wireless carrier is asking to roll back commitments. it is asking california for a waiver of network speed pledges and to create hundreds of jobs. it says the coronavirus is making it impossible to ensure new hiring and the promise of connection speeds instead of four years. billion,massed $10

putting it on track for the biggest buyout by a u.s. private equity firm for the region. sources say it has managed 80% of its target. it plans to close the first round by the end of the month. it could surpass the record $10.6 billion raised by hillhouse capital in 2018. credit suisse has started a probe into a potential conflict of interest involving a billionaire and the vision fund. looking at the finance funds, which require -- the loans are sourced by a cell capital, which was backed by softbank last year. investments of $1.5 billion. coming up next, pimco says gdp will not return to 2019 levels until the end of next year. our exclusive interview with the ceo is coming up next. stay with us. this is bloomberg.

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paul: you're watching daybreak: asia. let's get a check of the first word news. new coronavirus cases are surging across the u.s., forcing local authorities to reconsider plans to reopen. infections are soaring in texas, florida and arizona while california broke its record for new cases for a fourth day in the past week. the european union meets wednesday to discuss when to open external borders and may decide to exclude american travelers as long as the u.s. buy europeans. expectsmnuchin says he

-- as the administration considers that the round of demos payments. speaking at the bloomberg event, he says a new packages being drafted and should past next month -- and should past next month. >> i think you saw the recent employment numbers. people thought there would be another 8 million people unemployed. we put 2.5 no you and people back to work. clearly, this is the ppp working. i think you're going to see the economy had a very bad second quarter. i think you're going to see a spectacular rebound off the bottom of the third quarter. paul: the u.k. government is relaxing virus curbs, calling on people to use common sense. prime minister boris johnson is cutting the two meter social distancing rule to a meter plus and allowing hotels, restaurants and pubs to reopen. this message of cautious optimism is weakened by his own medical advisers who say

reopening carries a threat. the movie industry is heading back to new zealand. director james cameron is leading the way. beginning shooting the sequel to avatar. his 30 strong crew are given special exemptions to enter the country. the government ok'd the move as the film offer work to hundreds of new zealanders. shery: back to the markets, pimco boss manny roman says while the coronavirus pandemic poses many unknowns, there is plenty of opportunity to pick up underpriced assets. the $1.8 trillion fund manager is raising at least 6 billion to invest in distressed credit and other corporate debt. john micklethwait as part of the invest global summit. >> i am hardly an expert on tech stocks, let's talk about credit default. i think you have seen and a norma's amount of issuance in

the credit space from the end of march today. we have bridged the liquidity gap. then, there is going to be a need tole where we will think about solvency. and what they can achieve. if we know anything from history, we know it is a long cycle. where we will be prepared for it to be done. some sectors are going to be profoundly affected and will need restructuring. think of the airline sector. when are we going to see each other in the flesh? i do not know that. i do not know if it is two weeks away or six month away. part of it is also the virus, of course. irrespective of how much work we have done in terms of understanding the risk and keeping people safe, there are also things we do not know.

. as you see cases picking up in 26 of the states in america, there is a lot of unknown in terms of people's behavior and what people are willing to do or not. >> you say the best risk return balance. at the moment, you have the fed buying everything and supporting the markets. where do you see the best return given what you have said about credit? you said you are worried about that. >> i would just point out one thing, which i think is interesting. cycles,ook at the u.s. this is a long cycle. capital to to deploy restructuring situation is actually the opportunity to deliver outside returns. it takes time. you do not have to hurry, but it is something we are focusing on. there is the opportunity to

buy cheap businesses and cheap credit because of all the factors that were mentioned and the ability to put them in the correct structure with a look -- with the correct liquidity, i think the industry will deliver returns. you have seen that for the first time i would say in the ethanol crisis in 1991. you saw that in the tech and telco unwinding in 2001 and 2002. you sell a lot in -- you saw a lot in 2000 and 2009. hopefully pimco will thrive out of this market and find plenty of opportunities to invest. >> pimco is one of the famous winners from what happened in 2008 and 2009. is there a particular area you think will work for you in the same way it did then? you avoided subprime and bought well afterwards.

is there something you went to focus on this time? >> i think we bought very well. all credit. i was saying at the time i think there were a lot of sleepless nights. humble to be incredibly in terms of where we go forward. i think there will be plenty of opportunity in the sectors i have mentioned. for most of what we do, to avoid risky sectors and actually be defensive in terms of making sure we do not own things that break. there are sectors where we feel quite positive. think of the housing market. we think housing is in good shape. the whole market to market, it provides opportunities. it is pretty steady within the housing in the u.s. does not have enough supply. prices are reasonably stable given what we know. that is the pimco ceo,

manny roman. we will have more from the bloomberg invest global summit ahead. more guests speak exclusively later. plus, we will hear from brookfield asset management. the u.s. dollar is on a downward trend amid the fed's efforts to keep the economy afloat. the bloomberg senior editor for it is what we need. build the case for a weaker dollar. >> first of all, the federal reserve is obviously very aggressively committed to making money cheaper, to do whatever it takes to support the u.s. markets. curve controleld to make sure that bond yields stay lower across the curve and into the longer periods. compared to the several years

when the ecb was much more aggressively trying to keep yields lower and other central banks were trying to keep yields lower than the feds, we are at the point where the fed is making sure that it is firm in its commitments to keeping yields down as anybody else. that means you have seen the differential in rates compared to other countries come down sharply. that reduces the appeal of the dollar as somewhere to stay. more importantly in terms of why we have seen the dollar weaken recently is you had during the first very scary weeks of the covid lockdowns in march, a very ugly crisis, which showed itself as a serious shortage of dollars. you so therefore -- you some

will therefore one of the fed's less publicized measures was to offer foreign-exchange swaps to a range of other friendly central banks. and it'll last few weeks, we have seen -- in the last few weeks, we have seen swaps in the amount banks were using come back down again. the degree of anxiety, the dollar squeeze, dollar funding squeeze is reducing because there is less risk aversion. there is less fear. that means a weaker dollar, which implies people are more confident, which is healthy. shery: we have seen and now that easing pressure with the recovery as this gtv chart on the bloomberg shows. i do wonder, all of the structural issues you mentioned on the dollar, will that offset some of the safe haven buying we can see perhaps playing in to

the dollar? as i speak, we are getting beijing reporting seven new coronavirus cases. china reporting 12 additional cases. it seems that this continuation of the first wave of this outbreak is ongoing. markets do tend to react to this. >> well, they do. you could certainly point out the american stock market does not appear to be reacting to it at all. the nasdaq is at an all-time high. risk ifinly that is the you are going to bet against the dollar that there will be another wave of risk aversion. it is still not clear there is anywhere else that is particular safe to go. look at what is happening to gold, which is also going up very sharply. threatening to try to finally take out an all-time high that goes back some eight years.

gold is also doing very well at present. a further wave of concern about covid, which is a very real possibility, but that comes up against a fed that is determined to keep yields low across the curve, there are some other safe havens you can go to. gold and precious metals being the obvious one. dollar still imagine a -- imagine the dollar not strengthening out of safe haven demand as much as you might think. shery: good to have you with us as always. the bloomberg senior editor for markets. let's get you a quick check of the markets. we are seeing a little bit of pressure for u.s. futures. down a 10th of 1%. this as u.s. stocks ended in positive territory. -- we are seeing

sniffing and strength on the japanese yen, which is at the strongest level in seven weeks. we have a couple central bank decisions including the bank of thailand. we are expecting the boj summary of opinions. the ppi services numbers from eight out of japan. crude prices under pressure. as we head to the release of the u.s. government support, expect it to show another increase in inventories. the contactxt, tracing charge for singapore. this is bloomberg. ♪

>> i do not think anybody can be confident with the kind of uncertainties that prevail. what lincoln say that i would put my -- what one can say -- [indiscernible] greater odds on a v-shaped recovery. >> how we are going to share the burden in a still credible way. >> it is not just financial and fiscal support. it is regulatory charges we have undertaken to support the economy. leaders sharing their thoughts on the path to recovery at the bloomberg invest summit. 10gapore will vote on july

as the government seeks a new mandate that has pummeled the city state economy. let's get over to haslinda. theinda: singapore will be third country to host an election amid the pandemic. mongolia holding its election today. it is widely expected. we heard from the prime minister just yesterday that he is seething the virus the ability to hold an election. take a listen. >> the alternative is to wait out the covid-19 pandemic. but we have no assurance the pandemic will be over before this government's term must end next april. that is why i have decided to hold the general election now. still in the midst of covid-19. it will not be a normal election campaign. the prime minister

sets the stage for that much anticipated election. let's get reaction in how singapore is tapping technology to overcome the pandemic. let's get to the minister in charge, janil. let's touch on that election. how confident is the ruling party in garnering a bigger majority than the last election? janil: thank you for inviting me. as the prime minister pointed out, we have quite a lot on her plate going forward -- on our plate going forward. the public health crisis is far from over although our numbers and the situation in singapore is much improved. the economic impact is only starting to be understood. it is likely to be -- to last for some time. the prime minister may the point we need that mandate -- made the point we need that mandate to lead through the crisis and have the support of our people.

at the same time, we have learned a lot about the virus. finding a way to do the election safely has become possible. underw the circumstances which there are circuit -- there is the risk of spread and how to protect people. the operations, the execution of polling and campaigning will be altered to make sure it is safe. something we have to do and we are going ahead. of thea: the handling virus is expected to be a defining issue. do you think the issue will work for or perhaps against the ruling party? janil: it is hard to be absolutely precise. the adage of weeping a long time in all it takes is also true for the pandemic. it is hard to be sure where we will be a week from now. compliance toor

some of the hygiene and interaction restriction orders in place. a lot can change between now and polling day. that is something we are watching out for. the pandemic has affected us completely. has madel society and the interrelationships between singapore and the rest of the world, our economy, apparent to all including vulnerabilities we have discussed for some time. as to how this translates into results on polling days, i would not like to hazard a guess. this is not something we would like to play punditry with. we need to put our case out there to the people of singapore about what we have done, the measures we have taken. the results are there for the people of singapore to see. thiseality is i think election is not going to be about what has happened already but what is the anticipation of the future and plans to deal

with the future of this crisis as well as our country. theinda: speaking of future, singapore is tapping technology to ensure the pandemic is contained. it is the first country to roll out a bluetooth contact tracing avenue. give us a sense of why this did not work initially and how confident are you it will? janil: i'm going to take you to task where you say it did not work initially. it is working just great. the issue is firstly that we have not got past the threshold of adoption for it to transform the way we do contact tracing. that was never the point. we have a robust and effective contact tracing process. some of the other technology tools we have deployed were meant as an augmentation to our public health response. from that perspective, it has been working. the question is for how many

people and how effectively. the various tools have significantly sped up the contact tracing process, have brought down the time it takes to identify and isolate and quarantine people and slid on the spread. -- and slow down the spread. the technology works, but the key issue is that it is an augmentation to what is a human driven, professional capability of contact tracing. we think -- haslinda: give us a sense -- give us a sense of singapore's -- go ahead. janil: i will put this part of the answer into my next question. go ahead. haslinda: i'm just wondering, give us a sense of the broad strategy when it comes to tapping technology and putting this pandemic. singapore decided to ditch the up both by apple -- the up and

google together. the u.k. has decided to ditch its own app for that. what is singapore's broad strategy? janil: we did not ditch anything. outapp and protocol came some significant time before apple and google's notification protocol. our app was being deployed. it has been downloaded by 2.1 million singaporeans. beforeocess started long we had wind of apple and google's plan for a program. our strategy has been to speed up the process. what we needed was a way to make sure our tools could be deployed for all singaporeans. that is why we have the trace together app. that will become planted by the -- will be companied by the token. when put that together and integration with other technical

tools, we will have the possibility of helping every singaporean be part of this program. thendly, we wanted to keep process centered around the public health response. this is a health care problem. this is not a technology issue. it is a health care problem. notificationsle's does not have the public health officials the insights they need to derive to work out, this cluster happen as a result of singing or a particular eatery or a particular social activity. the way in which we tackled this crisis, this pandemic, this crisis going forward, it is not just require us to know who the patients are and have them isolated. we have to rethink how we do certain activities. how we design buildings, entranceways and activities. this needs insight. you can only have insight by having the data. apple and google's photocall

does not allow our officials to have that data. we are not ruling it out. it is a great piece of technology. it does not serve our purposes at the moment. that is why we have chosen not to adopt it and continue along the development path with our program. the door is open. we have very high smartphone penetration. raising of a good number are android and apple users there's a significant number are android and apple users. if it meets our needs, we would be open to considering it. protecting the health of our people and establishing the information required to do so and having full inclusion of our population need to be achieved in order for us to change our minds on this. haslinda: you talk about 30% adoption. that is still very low. you talked about how the token will be deployed to all residents. when can we expect that to happen? janil: 2.1 million of our population is low from the

standard we are trying to achieve, but it is one of the highest in the world. none of the other deployments around the world have significantly surpassed this. most countries are hovering much lower. similar a handful in a ballpark. way a testament to the extent to which singaporeans are willing to use technology to help fight this. the trace together token, we are starting to roll it out. we are still in the process of developing and testing and validating it. the tokens already exist. the rollout will be progressive from the end of the month to the end of the year. depending on how many people use it, need to use it and how it gets applied. we are not trying to use the token to replace the up. it is to augment the app. if people are happier using the app, they do not need a token.

there are pros and cons. the token is a simple advice -- simple device. you carry it around with you. you do not have to worry about the effects of data relief on your phone. -- of data relief on your phone -- of battery life on your phone. we will get going with that and slowly roll it out. minister, one question before we go. the issues to do with the privacy and surveillance. what precautions are being taken? janil: we have made it clear not the app itself does feedback live data to our ministry of health, it does not track gps location. it does not do many of the things people have alleged. it only does proximity tracking through the bluetooth protocol.

we have made the software open source so any number of third parties interested people have tried to verify this is indeed what it does. they have done so. they verified that when we say this is what it does, that is all there is to it. taking the same approach with our trace together token, it is not the same photocall. .t is -- the protocol they have established there is no gps. there is no cellular. the data -- haslinda: minister? janil: yes. the data is protected. haslinda: apologies. we have to leave it there, minister. janil: thank you. haslinda: minister in charge of go of type. thank you for your insights. back to you. shery: great conversation. we will have plenty more coming up on the next hour of daybreak asia. we just got the boj minutes from last week. bold action is vital for the

post virus recovery. one member of the boj commenting on their opinion. plenty more to come. this is bloomberg. ♪

>> good evening from new york. paul: asia's major markets have just open for trade. welcome to daybreak: asia. our top stories, asian markets facing an uncertain start after wall street faded among mounting concerns about the virus. traders are worried about the prospect for recovery. cases have surged past 9 million

with several u.s. states reporting record numbers. california has broken the record for fourth day. washington remains optimistic. steve mnuchin says he expects the u.s. recession to end this year with another stimulus program in the pipeline. shery: japan and australia are coming online. we are seeing nikkei fluctuating between gains and losses. right now it is way down by real estate and utility stock. topics is down 3/10 of 1%. digesting the latest summary of opinions after the policy meeting. one member had an additional easy -- easing. in the meeting last week, the boj did not move when coming to maine policy, only increased support for corporate financing

to $1 trillion. one member said the survival is securing corporate financing and bold action is vital for the post-pandemic recovery. we have watched the numbers in japan and we just got the user prices rising .8%. 106nese yen holding up level. -- strengthstraight for the highest level in seven weeks against the u.s. dollar. the kospi is up 6/10 of 1%. rising for a second session. korean won strengthening and the one-week high against the u.s. dollar. we are watching closely as -- we have seen the agm meeting happening today. we just got australian

stocks coming online. a staggered open and australia. modest gains the upside in a moment that will likely change in the next 15 minutes. new zealand stocks giving up some early gains up one half of 1%. new zealand dollar currently trading at 6503. one to watch today with the bank of new zealand handing down their decision on the cash trade. no change expected. lift for oursome the large-scale asset program but analysts think it might hang on until august before taking a look. kiwi yield steepening. steve mnuchin says he expects china to honor those sovereign nation under the trade deal. the of decoupling still exist. he spoke to david rubenstein. chinawe can compete with

on a level playing field, it is a great opportunity for u.s. , asnesses and u.s. workers china has a large growing middle class, several hundred million people. but if we cannot participate and compete on a fair basis, you are going to see a decoupling going forward. jodi schneider joins us. what is steve mnuchin's message to china? >> there are kind of two messages. one is we want to do trade with you and see this as an ,pportunity and the u.s. particularly trump having a reelection bid, is interested in having that market open and discussing getting the sales of

agricultural products from china. at the same time, the tough line, we expect you to live up to your commitment. transparency is another big factor is what that messages. so trying to do both things. test the market but say we will be tough on you if we need to if you do not live up to your commitment. shery: where do you think stand with the u.s.-china trade agreement? we have had back-and-forth comments in recent days. >> well said. president trump has said clearly the phase one trade deal with china is fully intact. this came after peter navarro, his trade advisor, basically said it was over in an interview .e did with fox news he said the deal was over. a lot of tumult in the market in

and during the trading day then the white house said the deal is not. at the same time, even as he was saying that, president trump said in a tweet, hopefully they will continue to live up to their terms of the agreement. become as much a message as we want the trade agreement that they have to live up to their side. at the same time, tensions grow day by day among other factors. but they seem to be sticking by the trade agreement for now. shery: let's get a quick check of stocks we are watching. low tech shares and affiliates. three months and they found her passed away and we have seen family drama with two sons fighting for control. in april, one son submitted a proposal to dismiss his brother.

watch out for those stocks. softbank,s look at currently in positive territory in tokyo after t-mobile stock offering. each ine shares at $103 the softbank deal. a 4% discount from the closing price was on tuesday. interviewome, and with blackrock chair geraldine buckingham. interview with james bullard. this is bloomberg. ♪

paul: you are watching daybreak

asia. a quick check at the headlines. new coronavirus cases are surging across the united states, forcing local authorities to reconsider plans to reopen. infections are soaring in texas, florida, and arizona. california broke the record for new cases for a fourth day in the past week. the european union meets wednesday to discuss went open external borders and might decide to exclude american travelers as long as the u.s. continues. u.k. government is relaxing virus curves, calling on people to use common sense to stop the spread. boris johnson is allowing hotels, restaurants, and pubs to reopen next month. optimismge of cautious is weakened by his own medical advisors. the annual institute shows 23%

trust asia to act responsibly on the global stage compared to 72% two years ago. confidence in xi jinping to handle world affairs had lost have to 22%. only 30% trust president trump. has put any military action against the south on hold. he says he met army leaders and told them to disband moves against so. -- seoul. high.n remains his sister has warned the north's next move would include the army. shery: asian markets based on uncertainty among concerns about a spike in the pandemic. let's get some news with blackrock chair geraldine

buckingham. thank you for your time. we have seen investor sentiment being hit by the latest headlines on virus resurgence but we have seen the continuing trend of disconnect between the financial market and the real economy. what do you make of the rebound we have seen in the second quarter? geraldine: thank you for having me. i think it is better to say the markets globally are being driven almost entirely by the pandemic and response. advances,s of medical significant moves in the market respond to that. have seen unprecedented world response around the that has helped push markets. in the last few days we have ofn not only a large number

u.s. cases, but also a number markets in asia, places where they had confidence the pandemic was under control like beijing, south korea, victoria, australia. things had been handled but the fact that there has been an uptick in cases, it's not unreasonable to expect that will make a difference. i think we can say markets are being driven by these trends whether it is case numbers, medical responses, and policy responses. shery: we have seen massive liquidity in the financial system from central-bank support globally. how does blackrock adjust to the new normal? geraldine: one of the things we are focused on with clients is at lowerre looking rates for a longer time and even lower in longer than we had anticipated.

we are talking to clients about their concern about their liability at an environment where yields also low. insurance companies, pension funds, organizations with real liabilities that need to be met and the concern is they are not able to do so unless they take more risk. shery: with central banks taking such a big role in the bond curves are breaking rates and offering less information about the health of the economy. assessing go about where the global economy is now? think there is unprecedented contraction and a lot of optimism in markets has -- as stark markets have moved to reopening and looking for ability ofabout the

economies to restart supply and what demand we are seeing. and werought by sector have to look sector by sector, geography by geography. case increases we have seen might undercut markets in the next few days or weeks. paul: let's zoom in on one of those sectors and look at em asia funds. some have recovered the losses even though the crisis is far from over. economies are still suffering. how concerned are you? geraldine: i think we are cautiously optimistic. we recognize emerging markets it is the world, anticipated they will be

cautious. one of the outcomes of the pandemic is we will see greater .n -- greater inequality many market economies are dependent on trade and tourism and that will be impacted on concerns about health care response in some countries and their ability to respond. in asia we have counterexamples. vietnam is doing well. and weough to generalize need to be focused in our analysis. emerging markets is something we will watch globally. the top has been a non-asian markets at this point but we will continue to watch closely. paul: as we see earnings come under pressure, leveraging is getting higher. how do you perceive the defined risk at the moment? acrossne: varied

sectors. we are seeing extraordinary response from governments to support various industries and we need to let some of that play through. some focused on the extension of programs. heightened risk given the economic contraction in the world but we see extraordinary policy response targeted in some sectors to protect employment. simplet think it is as as economic contraction. what sectors do you see the most risk globally or in the asia-pacific? geraldine: obvious ones that have come under pressure. retail, travel, they are under enormous pressure. we are seeing multiple countries

in the asia-pacific expected to go into recession and i think anything dependent on consumer spending, we will see tightening. i think it will be reasonably broad but some cases like the travel industry. or it will be wait and see. are those some sectors were blackrock sees opportunity? geraldine: there are pockets of quality credits out there we are i do not think it is a uniform thing and we need to be more targeted and that. shery: in china we have seen efforts to carry on financial reform. you expect this to continue post pandemic?

geraldine: absolutely. that is our expectation. we have seen a continuation and acceleration a financial reform and the chinese market we think that will continue. in addition to the challenges created by the pandemic, i think are a number of other issues. a real challenge around the chinese economy, helping people protect long-term financial futures and i think recognition among chinese policymakers that in order to help chinese people invest in retirement, the deeper capital market would be beneficial and we think they are committed to developing those things. paul: we have a timely reminder yesterday that peter navarro made comments that put the u.s.

trade relationship on the skids and then rewound by trump. are you concerned about the risk of u.s.-china decoupling? geraldine: yes. geopolitics have become a more significant force than a few years ago and this challenge is at the center of it. , the white house came out to clarify that phase i will continue and we are hopeful that global trade will continue to grow. the world is under significant financial hardship but we believe trade is important to restoring economic growth around the world. no doubt geopolitics has become a more meaningful force and markets and one that we will have to navigate. paul: against the backdrop of

the tension, does it have any implications for blackrock or other firms looking to build operations in china? geraldine: at this stage, i would say no. we are optimistic. we are committed to long-term plans in china but in terms of a globalry, we want clients to invest. but it certainly made things a bit more complicated than they were previously. but i are focus and commitment to china remains. shery: what can you tell us about a potential subsidiary wealth management service? geraldine: we have been public about our interest in building onshore business for onshore and making opportunities available to global investors. we are pursuing partnerships

with institutions. shery: does that include ccb? geraldine: it has been publicly reported, yes. shery: what sort of categories can you sell? can you give us more detail about what it would entail? geraldine: the project we are working with them is primarily directed toward retail investor base in china which has been growing quickly. it is fair to say the investment market in china has not been historically as sophisticated as other parts of the world and they invest heavily in money fund life products. try to been looking to use multi-asset products and potentially find healthy tog-term investment culture

try to help people save for their long-term financial future in a way we think is appropriate and in a way they can reach their goals. shery: whether it is global in retail. or chinese asian investors, what do you make of the retail investing actively managing their finances? what does it do to fund managers like blackrock? jerilyn: our managers are wide range of products through the active spectrum and liquid alternative. i think we see retail investors want to participate in the management and i think it is small compared to the overall retail market with a market money is managed through advisors or intermediaries or pension funds. so i think there is a role to play for that and our goal is

people be well educated and understand the risks they are taking and that we help them make good decisions. chair, geraldine buckingham, thank you for joining us. plenty more to come on daybreak asia. this is bloomberg. ♪

shery: let's get a check of the latest headlines. mastercard has taken another step away from the original business with an 825 million other deal to biotechnology firms. the purchase gives mastercard or tools to help banks speed up credit decisions. -- that is helping drive it deeper into account to account payments. abu dhabi sold $10 billion stake

in the natural gas pipeline at a including sostors -- including singapore sovereign wealth fund and the biggest infrastructure deal of the year so far. buyers will have 49% in the new subsidiary. values at $21 billion. credit suisse has started a .otential conflict of interest the lender is looking at supply chain finance funds that supply loans for startups. the loans are sourced by greenville capital backed by softbank last year with an investment of $1.5 billion. another great conversation from the summit. carmen reinhart sounds the alarm for emerging markets on the

impact the pandemic is having. this is bloomberg. ♪ you doing okay?

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shery: carmen reinhart says coronavirus is hitting emerging markets harder than advanced nations. less fiscal space and greater reliance on tourism and commodities means the economies are facing problems that outweigh those of the richer peers. she told us what kind of relief is needed. crisisve likened the more to the 1930's then to the 2008l financial crisis of -2009. the reason for that, despite the fact that the macro policy response across countries has

been very different than what we saw in the 1930's, the reason is that this is truly a global financial crisis. two 2009 was a banking financial crisis in 11 advanced economies. the emerging markets were hit, but rebounded sharply. china was growing double digits commodity markets were very strong. this time, the advanced economies are seeing problems that pale in comparison to some of the challenges and problems the developing countries and emerging markets because they do not have safety nets or the fiscal space to try to counter the effects of the lockdowns. so the issue of how do you

support countries in which revenue has collapsed, if you rely on tourism. tourism has to last. if commodity -- if you rely on commodity, commodity volumes are down. the world bank and imf, multimedia -- multi-letter unities in general have been in terms ofending the number of countries that have access in lending. one important feature that distinguishes the landing wave by the multi-lateral like world bank and imf is the speed with been decided on, theiron, and reached destinations for countries to be

enabled to counter all of the very many dimensions of the aftershock they are facing. crisis,as i said, this taken,ifestations it has it is not just a health crisis in some regions and some areas of sub-saharan africa. you're also facing food crises situations. in the caribbean, you have an overwhelming dependency on tourism and the situation is very different. nonetheless, very acute. so there is a diversity of very serious problems and so the response up to the moment has been based on providing the speediest relief. done nowore can be

that speedy relief has been put in place? >> what more can be done? to an 1 the g20 agreed suspendve that would debt servicing for the poorest countries. the kind of savings potentially would be freed up resources, the resources that were being used to service the debt to be used the anti-covid response. , the participation has been predominantly an official one. paul: that was carmen reinhart.

we will have more from the summit ahead. and we will talk with jessica tan speaking to us later. many economists are upgrading the forecast for china's economic growth this quarter and for the year, signaling more optimism the country is on track for recovery. but china beige book disagrees. a survey says china is headed for a recession. joining us is leland miller. you see a recession in the making for china. how deep and enduring do you think it will be? leland: we are just looking at the data coming in now and we see an extension for the second quarter. we have moved out of contraction

territory, which is something. first time in three months. but when you look at the on year, everything is still in a very deep recession. we can talk about recovery and improvement that's fine. but if you put it in the context, you have to understand we are known it -- we are nowhere near the return to growth, the level of normal growth we have seen in years past. and last year, even though it was a slow year. paul: wouldn't you expect the chinese government and pboc to throw a lot of stimulus at the issue? leland: we would and we have been surprised so far. you see what is happening in europe and the united states and around the world and there is enormous stimulus packages that have been intended to keep the economy running and recovering and china has been very restrained by comparison.

we are looking at the borrowing levels, which are going down. there is an issue with credit supply. i think they have been relatively tight this go-round because they are worried about nonperforming loan build up worried about the exchange rate. the other thing is looking at loan demand. we've been surprised to see how large the share affirms our that are looking at the economic horizon and waiting it out. some of them might think they landscapeand see the improve before borrowing more. traditionally, china does open the spigot and let it run. seey: does it mean we could more responsible policy coming from beijing in the long term, which could be healthier the overall economy for beijing?

leland: that is an optimistic take. i am not sure more responsible policy is coming out of anywhere right now, particularly with faced with the intensity of the outbreak. what i think we are starting to see is a decision being forced on beijing whether they want to treat this as something they can push through or whether they have to revert to the old playbook of heavy infrastructure stimulus. for the last 3.5 years, we have not seen them go back to the old building bridges to nowhere but we are starting to see evidence of it. in the first quarter we saw a rally in transportation construction, firms are very active and there is a lot more borrowing, much improvement from the first to the second quarter. so we could be seeing the beginning of a rally in the construction industry, which would be good for growth but very bad in terms of china's efforts to rebound. shery: in the last years we have

talked about china going from being the factory of the world to being a consumption led economy. this will -- will this hold post-pandemic? leland: it's too early to tell the right now the consumption data doesn't look good. you look at retail and that is the major sector we saw that is still in contraction. retail is not doing well. services are not strong but it was the best of the sectors. you are seeing some of the economy recover. youhe months after covid, are seeing people change have it. nothing is back to normal and probably won't be for a long time. it's too early to make the judgment on china's future as a consumption capital but right now it looks like they are not doing enough. shery: leland, always great talking to you. let's turn to the markets with

sophie in hong kong. sophie: asian stocks are drifting high and bonds are falling. u.s. dollar extending declines for a third session. they reckon the dollar has started a long overdue correction and today the aussie is leading gains against the greenback. kiwi dollar yields are steepening. kospi, peace talks are gaining ground. reported to be easing provocations against south korea. one mover of note in sydney, pushing above $9 trillion after the merger with vodafone has gained approval and the merger is on track for middle ear --

midyear completion. jumpinger in tokyo after reporting a 27% year on year rise in june sales. biologics climbing after dealng a 381,000,000,001 -- 381 billion won deal. the company makes products that contain a drug that has been singled out to help treat covid-19 patients. rallying.rs are rising the most in at least four bone -- aplan for a bonus issued. the rival is also gaining ground this morning. come, jamesto

bullard makes his case against the yield curve control. that is next. this is bloomberg. ♪

-- karina: this is daybreak asia. he expectsin says the u.s. economy to emerge from

recession before the end of the year. they are considering another round of stimulus payments. he said a new rescue package is being drafted and should pass next month and that he is confident in the recovery. marcus brown has been granted bail at more than $5 million, one of the largest amounts posted in germany. month.ed himself in last the missing funds probably do not exist. he is being existed for market manipulation and false economy -- the movie market is coming back to new zealand. james cameron is leading the way, beginning the shooting of the sequel of avatar. they have been given special exemption to enter the country. moveovernment okayed the as the film will offer work to

hundreds of new zealanders. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. shery: james bullard says a strategy of capping treasury yields after -- might not work and the control seems unnecessary. he spoke with bloomberg earlier and said the u.s. economy is recovering faster than he expected. a lot ofe deployed good tools for the situation. i think the policy response has been quite good to the pandemic on the monetary policy side, the liquidity programs, plus a good response from the political side to thosescal relief who are disrupted by the pandemic. i think all of this, given the nature of the shot, it is all

gone pretty well so far and i think july 1 is a good checkpoint because i have long advocated the main impact in the quarteruarter and third will be the opposite of the first. it will be a big increase. come back online safely in a way that keeps the pandemic under control. >> other committees thinking about ford or -- forward guidance. yield control was a big part of the conversation. how would you characterize yield curve control from your perspective? >> u.s. had yield curve control during world war ii and after from it wasexit

difficult. it ended in tears. so one of the main concerns about going in this direction, japan has done yield curve control and one of the things they wanted to do was get out of the quantitative easing program, to scale that back dramatically by targeting yields directly. i think there are a lot more questions than answers around yield curve control right now. >> what you think the optimal approach to forward guidance is? is no problemre with where we are today. we are projecting low rates far out into the future, longer-term have thee low, and we advantage in the current situation we already built up

for low rates and commitments to low rates to the last crisis. as you might recall coming out of that in 2010, markets were expecting the yield to leave back higher at any moment and many tried to fight back against that and keep yields low by promising low rates further into the future. in the end, built up a lot of credibility that we will keep rates low so this time we have a lot of credibility on the issue and i think we are in great shape for right now because of the crib -- because of the credibility we built up last time. 2015 to raise the issue of asset bubbles that will come on the heels potentially of leaving rates so low for so long. given how much corporate debt issuance we have seen, what is different now? bubbles are always an issue

in a keep my eye on it but i am just not seeing things that are of the same magnitude as what theened in the late 1990's, dotcom level that blew up on as and the serious housing bubble that turns into a global crisis. i'm not seeing anything like that now. we watch it closely. i understand companies are taking on debt. some of it is liquidity driven to get through the pandemic. they are drawing on lines of credit and other sources to make sure they can survive and thrive till the time of low revenue for their business. so far, so good. we will certainly watch this closely. that was james bullard.

kathleen hays is here for context on the interview. if the fed is ready to do whatever it takes, why not adopt yield curve control? kathleen: jim seems reasonably optimistic on the outlook for the u.s. economy. expects a healthy rebound in the second half of the year. when he spoke at a webinar after speaking with bloomberg tv he said he thinks u.s. could be at 90% of output capacity. aboutounds like a big considering the lockdowns and all the damage done to businesses on the economy. think itofficials would work but they don't need it now. on wall street, people are saying, we will see what they say. if and when bond yields start rising and investors have to absorb trillions of dollars of

new u.s. treasury bonds, if they see that, they think the fed might be more willing to put in a system that would cap yields because the higher two, more cost the government to finance the debt. a study came out today, yield curve control, they are not enthusiastic. japaneference the bank of , his team invented yield heard -- yield curve control. we got a summary of opinions from the bmj and it's a mix. ist of the message you get about, if we need to do more, we will. they boosted the emergency

lending program at the last meeting and they want to see how it works out. but theywaiting to see have their foot poised above the stimulus pedal, ready to press down harder if they have to. paul: we have two central banks posting rate decisions in asia. new zealand is a first. kathleen: they will wait and see. if you look at this chart you can see new zealand cut their key rate terrestrially -- key rate aggressively to a record low. meeting they doubled the amount of bonds to purchase over the next year. so they can sit and wait. maybe traders will talk about going to negative rate but some

economists said there is no monetary policy report being issued and it's no time to make a major announcement so maybe we should not expect it. more comments about how well the government managed coronavirus. even though negative gdp and high unemployment, keeping the door open to wait to see. with the bank of thailand, unexpected to do anything. they have been cutting rate three times since the beginning of the year. down to .5%. well bys was handled the thailand government. they have not had many cases relative to their population. but the trading partners and tourists from around the world, the virus has cut all of that

dramatically so they have weakness and worries. the bot is another concern. it has been rising. people think this is a wait-and-see time. some comments to be about banks and the fact that bad debts are rising and quality of loans there holding, last week the bank of thailand told banks to hold off paying dividends. those of the things we will listen for. more ahead on daybreak asia. this is bloomberg. ♪

shery: before we hand over to china open, here are how markets are trading. a mixed future with the nikkei gaining 4/10 of 1%. the japanese is below the 107 level. we have not seen the strength in seven weeks against the u.s. dollar. cost beginning 1.8% rising for a second consecutive session. korean won, strength. one-week high against u.s. dollar. paul: plenty more to come. managing director for capital markets joins us shortly to

share their strategy and asia. and we will be spending with me -- we will be speaking with mandy lewis. chinese markets are open for trade. this is bloomberg. ♪

tom: it is 9:00 a.m. welcome to "bloomberg markets: china open." david: we are counting down to the open of trade. worries keeping investors focus. u.s. futures flat. the dollar declining for a third day. tom: cases search