♪ haidi: a very good morning. i am haidi stroud-watts in sydney and we're counting down to the asian market open. shery: i am shery on in new york. our top stories at this hour. asian futures topped a modest gains. u.s.tors are analyzing jobs data and central bank statements that reflect a fragile economic recovery. the u.s. treasury, oracle and tiktok are sent to agree on a deal which could see a new

company ipo in a year, if approved by president trump. is this ride hailer .eeking to shore up cash haidi: let's look at how we are setting up for the final trading session of the week in asia. after a pretty lackluster session, we had u.s. stocks passing some of those -- parsing some of those losses, still dropping for a second day but finding support after bouncing off the 50 day moving average on the s&p. s&p futures seeing a little positivity on the u.s. friday's session, about 0.2% higher. tax leading the client is apple, facebook and peppe microsoft are weighing on declines. we saw a little movement in treasuries as well. in asia, the nikkei 225 is seeing an upside, 0.1% when it comes to futures trading in

chicago at the moment. dollar weakness/yen strength will be an issue, the. we have the yen appreciated to the strongest level in six months across broad dollar weakness. the u.s. dollar index falling for a fifth straight session. we are also keeping watch on the dollar and how it is trading against the hong kong dollar. hma intervening this week as cash demand has been growing. is eyeing, bytedance a listing in hong kong. so a little bit of the liquidity crunch is weighing on the currency. u.s. treasury, bytedance and oracle have agreed to terms to keep tiktok operating in the u.s. but the deal still has to win the approval of president trump and china. let's get more from our market beijing. tom mackenzie

tom, what kind of revisions have been made and what are some of the challenges that are still there? tom: there are still challenges. we have had the u.s. treasury steve mnuchin -- secretary steven mnuchin revising the deal. sources, rightr down's and oracle have at least to the changes. would still be a majority holder in the new structured business with headquarters in the u.s.. oracle would take a minority stake. part of the provisions would be an independent board as part of the business that would be overseen and approved by the u.s. government. they would also as part of that be a national security committee involving all u.s. citizens and leading, chairing the national security committee which is ached into that business would be a data security expert who would link that business and cfius, the with

community of foreign investment in the united states. oracle would have oversight over the data to ensure there are no back doors. we are also hearing that as part deal, is that if it gets approved, they will be looking to ipo in the next 12 months or so. we spoke to president -- we saw president trump speaking at the white house, saying that he and his team have been in conversation with oracle, with walmart, which still want one of the business, and also curiously, microsoft as well. shery: we are really getting conflicting reports on what this means, right? also, tencent is under scrutiny. what are the concerns there? tom: going back to the committee for foreign investment in the u.s. they have written to gaming companies across the united states to ask them for an update on their data protocols when it comes to any links that they have with chinese businesses.

of course, one major chinese business is tencent in the gimmicks ace, in fact, the world's largest gaming company. it has stakes in hundreds of gaming companies around the world and many in the u.s., in which it has a 40% stake, and riot games, which it owns outright. so they are looking at investment in these gaming companies to make sure the data is secure. it is a reminder that all chinese companies operating in the u.s., particularly those involved in technology, are coming under greater scrutiny from the trump administration. it could ultimately lead to reviews of some of these deals. that is probably what weighed on the adr's for tencent which moved lower on the back of the news. tencent is also the owner of the wechat app, and there is an order which bans u.s. businesses that.sing

we are awaiting specific details about the implications of that executive order, which we are expected to get on september 20. shery: our markets: kurt, tom mackenzie in beijing. regard to karina mitchell for the first word headlines. karina: global coronavirus cases have passed the 30 million mark, with more than 940,000 deaths, as the world organization warns of a resurgence in europe. france is reported the most new daily covid cases since the end of the lockdown in may. for the second time in less than one week, there were more than 10,000 new infections. the northeast of england is introducing tough restrictions. meanwhile, the highest level of u.s. officials to visit taiwan in decades has made a second visit in a week, prompting the threat of retaliation from china. the u.s. undersecretary of state arrived thursday evening to meet the island's president, premier and foreign minister, as well as to attend a memorial for the country's former

executive. the fed says it will decide in two weeks whether to prolong the limits on its biggest u.s. banks. the measure was announced in june and were due to last until the end of the third quarter. the bank of england has given the clearest signal yet it may consider cutting interest rates to below zero for the first time in its history as it rattles the coronavirus and risks of a no-deal brexit. governor andrew bailey said last month, the policy is part of a toolkit. markets are betting that next 10 basis points of easing will come in february, with similar most shortly thereafter. global news, 24 hours a day, on air and @quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am karina mitchell. this is bloomberg. lots of breaking news especially around ipo news. shery: unity software is saying that they will be pricing their

ipo above the range, at $52 per share. unity develops software used to design videogames. they said on monday they were willing to sell shares at a price range between $44 and $48 per share. now they they are actually pricing their ipo at $52 per share according to us forces speaking -- according to sources speaking to bloomberg. news. and here is more we are about a year away when it comes to the lg battery unit ipo. the company saying the better battery unit listing will take a half year. kem would bet lg willing to split off its vehicle battery business into a separate entity. we heard they were trying to do that to cut out value across the global electric vehicle demand side of things. that business is the top maker of car batteries

globally. we are now hearing that the company is planning a battery unit ipo which will take about a year's time. really eventually it will allow focus on that fast-growing part of the business and allow investors to make more targeted bets on the battery business. a little more details including that shareholder meeting to seek approval for the split, coming up at the end of october. still ahead, renewed interest. value is looking at the best month in nearly 20 years versus growth stocks. we look at where where the rotation has led, next. this is bloomberg. ♪ this is bloomberg. ♪

shery: we are saying u.s. futures up 0.1%, reversing the earlier declines in the new york session when we saw the attack selloff intensify.

the nasdaq losing more than 1% -- the tech selloff intensify. ofare joined by jay pelosky tpw investment management. we have been talking about the tech selloff for quite some time now. when you see where we are standing in terms of growth against value, the chart on the bloomberg is showing really historical lows for value stocks against growth. actually the lowest since 1981. when can we start to see some of this rotation actually be sustained? jay: that is the great story, it doests that when the move happen, and we believe we are in the early stages of a very important rotation phase both securely and geographically, it is going to have legs and it is going to have a long way to go. we think there are two drivers

in the near term. first is fiscal policy in the united states. we think there is going to be a deal. the white house is desperate for deal. science, the speed of which we talked about before on your show, the speed is a signature in the covid age, and the speed of science means we are going to have a vaccine in the near term. these two things combined, the interest rates go higher. interest rates are the fulcrum that leads to the shift from technology to financials, and i believe rising rates in the vaccine are kryptonite for the technology growth sector because they spurred the move into cyclicals on the one hand. and on the other hand, they actually detract from the valuation case of financials, which is built upon low-rates, making the cash flows of tech companies ever mobile global. higher rates work against tech and work for financials.

that is going to drive the rotation trade. shery: what about rotation in terms of region? we have seen the u.s. supremacy, whether in the market levels or economic growth, post-pandemic, what could we expect? jay: that is exactly the right question. if you move from within the united states intersectoral rotation, or even factor in style rotation to geographic, as you point out it has been the u.s. for 10 years. we think the recent weakness in the dollar is the precursor to a broader move away from u.s. equities. i would just note that the u.s. is very check-heavy, the rest of the world is not, -- the u.s. is very tech-heavy, and a rest of the world is not. that has been the reason why the rest of the world has not performed that well. but the asian markets, both

japan among the developed economies, as well as south korea and taiwan, we like all three. we also like china. we are keen on the e.u. we think the negativity around europe is completely misplaced and we are quite keen on european equities. haidi: to that point, in terms of the equalizing of the weighting, i want to look at the s&p equal weighted index, it is a matter if apple gets the same waiting as everybody else. i just want to get the chart up to take a look at this, here ago. big-tech is actually lagging if you look at how this is kind of presenting itself year. i am wondering, how much does this rotation that we see is the frost being taken out of tech and how much is the convincing rotation into other parts of the market?

and if it is not the latter what do you need to see as a catalyst up, do we needg a better handling of the virus situation, more convincing news when it comes to vaccines? jay: that is a great question. we have been calling for a healthy pullback for the last month or more. pullback iss healthy. it does take the frost off. one data point is the vix, the volatility index, now under 20 today, after being as high as 29 in the beginning of september. in two weeks, the volatility the roughlys fallen by one third. we are at the tail end of this correction. and it is a correction that is helping to drive rotation. we say that, when you look at the spread of, say, the equal weight versus market cap, as you showed.

also, look at s&p growth for example, down 6% month to date versus s&p value, which is down less than 1%. this is a significant rotation going on underneath the tech selloff. if you look at transports, which u.s., aeen on in the new high yesterday look at airlines. investors are starting to move into the things that has not worked. look at airlines in the u.s., there is an etf called jets, it had a nice move in the last so.h or it is still down 30% to 40% commodities are still down 30%. .inancials are still down 30% we need to see the fiscal stimulus. the fed is bullish, that is what the markets have told us the last two days. we are past peak fed. we need fiscal stimulus. this is an issue around the world, and the fact that the u.s. is struggling to pass a fiscal stimulus package months

before an election actually -- the election is a ready underway. the early voting in the u.s. has already started, so the reticence in the white house is very surprising. i think that has changed over the last couple of days. we need a fiscal package. the rest of the world does not have the us these are the political uncertainties the u.s. has the next several -- the rest of the world does not have the political as entities the u.s. has had over the last few months. we saw that in europe in the last few weeks where france, germany and holland came up with new fiscal packages. so the u.s. is a regional regard.in this haidi: we always appreciate your time with us, jay pelosky, chief investment officer of tpw investment management. lots more to come. this is bloomberg. ♪ this is bloomberg. ♪

shery: pressure is mounting on

drug companies to rush covid-19 trials as global cases top 13 million. but one johns hopkins professor tells bloomberg how important it is to collect enough safety data first. take a listen. >> first and foremost is, trials are growing quickly. does it mean we have the full technology we need to determine safety. clearly, we have had the astrazeneca vaccine out of oxford that was stopped and halted early. it has not resumed in the carry. it has not resumed in the u.s. due to further safety reviews. in that case, there was a case inflammation of the spine and we don't know yet whether or not it was related to the vaccine. we don't think so, but that is the kind of reviews that have to go on. it has to be thoroughly vetted. that vaccine will take over one month likely in the u.s. to go

vetting. full it depends on the safety profiles and the signals we see participants. >> are you comfortable that when a vaccine is available, it will be 100% safe, and unless we have one, how many people will want to be vaccinated? >> i think it is important. there is so little that we ingest 100% without side effects. you think about it this way, taking into much water, that increases the amount you need to look to the bathroom at night. everything has some level of negative impact if taken in the wrong way or at the wrong dose or wrong structure. vaccine safety is no different in that regard. we just need the data. we need to understand. the flu vaccine, for example, causes many to have a sore arm, slight temperature elevations, and that is in no way a live virus vaccine.

the vaccines currently for coronavirus, they have a mechanism used to put the protein in your body, which can cause fevers, chills in some participants. -- it is nott be possible to have a fully that isfree vaccine just not generally how it works, but we want to reduce the possibility as much as possible and have long-term follow-up on people to know that when we say to people here is a potential side effects after does 1 or dose 2 of the vaccine so that people know what to expect. and we can provide them anticipatory guidance. haidi: that was the johns hopkins university nursing professor, jason farley, speaking to francine lacqua. we stay with the push for the vaccine. the montana founder and partner thetech have in making

details of their vaccine test public. the push to increase disparity comes after astrazeneca denied a separate report that a volunteer in the trial developed a nerve disease. let's get more with our correspondent. tell us about the move to release due to information about vaccine trials. it comes as policymakers and the public are concerned that speed might be coming at the expense of safety and potentially efficacy when it comes to the vaccine. michelle:, we are seeing here in the united states a huge push to get a vaccine to the market urgently, and especially before the election coming out in early november. there are concerns that there is a political layer on top of the scientific push that has been truly remarkable, the speed with which these companies have started developing vaccines. we have a dozen in clinical trials already, late stage

clinical trials. it is remarkable. the question is, as you were talking about earlier, whether there is any compromise with it comes to safety. the companies that we know of -- moderna, biontech and even astrazeneca are saying now that they will start disclosing everything, giving 100-50 page document detailing everything because they want it and sure that they want to assure the public that everything they put out will be safe. shery: meantime, china faces and deadline. what is the view as to whether china will sign up to the w.h.o.'s global inoculation initiative? michelle: the world needs to put some effort into making sure that developing countries get their vaccines to protect populations, because that is what we will need in order to get coronavirus under control. china has not signed yet it will participate in the initiative, as today's program is intended

to help those developing countries get the vaccine they need. the u.s. said they will not participate. china indicated it is willing to , that it views it important. they say the vaccine developed in china will be made available. whether or not they will participate in covax, however, we don't know. the decision will come any day now. haidi: bloomberg's health care reporter michelle cortez with the latest. we are finding out more about sri lankan airlines' outlook is being affected by the pandemic today, speaking is possibly with the chairman about safety standards and cost-cutting. let's get a quick look at your headlines. j.d. health, a unit of china's number two e-commerce giant, jd.com is planning an ipo. hong kong has seen a parade of biotech firms go public to surging demand, and health care companies have raised $13

billion for first timeshare sales in asia this year, breaking a 12-year record. bytedance's rival is said to be considering a hong kong ipo which could raise as much as $5 billion. it is the biggest rival to bytedance's domestic version of tiktok. the chinese startup, backed by tencent began in the smaller chinese cities and rural areas before expanding to the mainstream. it claims to have over 100 million daily active users. i is said to be exploring the sale of its chinese burger king business. they are in china competitor runs more than 2000 burger king outlets across china and turkey, and it is the largest global franchisee of restaurants. a sell-off could kick off next month. it is said that the company could also revise plans for an

ipo. japan's of new prime minister may help the bank of japan tiptoe away from its inflation target. we will discuss that in a couple of minutes. this is bloomberg. ♪ this is bloomberg. ♪

shery: we are getting japan's consumer price numbers for the national cpi year-on-year. growth of 0.2%, in line with estimates and a deceleration from the previous month. course it be our numbers, excluding fresh food a year-on-year contraction of 0.4% in line with estimates, as is usually the case with japan these days. we are seeing it really fall into this inflationary territory for the first time since may. we have seen some pressure on prices. government-funded this comes in order to spur travel and demand in the country has really pushed

that is really pushing down on prices. core cpi excludes energy. you have a contraction of 0.1%. we are seeing this inflationary territory for those core cpi numbers for the first time since 2017.of this comes on the back of that central-bank decision by the bank of japan where nothing much changed. they did upgrade their assessment of the economy. let's discuss with bloomberg's mobile economics editor halfing haze we start -- kathleen hays. we start with the bank of japan. we are getting further and further away from the inflation target. kathleen: and it looks like perhaps as we get a new prime minister in japan committed to the bank of japan's policy of abenomics, the shoc focus of where abenomics has been on inflation may have been shifting. in terms of the main things we heard that governor kuroda said,

they looked at their economic outlook, and they will maintain stimulus. and he made it pretty clear, he too is ready to work with mr. suga, just as mr. suga is ready to work with him. let's listen to what kuroda said about the economy. >> japan's economy has started to pick up with economic activity resuming gradually, although it has remained in a severe situation due to the impact of the coronavirus at home and abroad. kathleen: and, of course, he also said, not surprising, as the law requires, the boj will fully cooperate with the government as they also recommitted to the 2% target. none of it is a surprise. . subsequently, as people thought about what was going on, as our boj team in tokyo wrote, this

decision, what they always do, it may reflect suga's greater focus on growth and inflation, and it may open the door to a governor kuroda and his team making steps as well. he talks also about the need for structural reform to continue. mr. suga has. interesting too now that corona says the need for regulation, something that suga has been supporting for a while is recognized. the boj stands ready to continue to support a safety net through monetary easing. it is interesting. people are saying maybe , they may beeaves wondering if they boj will soft at its commitment to the 2% target. kuroda said at the press conference yesterday that he thinks that what the fed has done to allow inflation to overshoot is similar to what he has done.

you see mr. suga speaking here. the idea now is that are haps one of the effects of the shift from prime minister to the next, still on the same page, will allow the bank of japan to shift to being someone who is sort of a, an advisor on certain policies to suga, and not so much a focus on inflation. haidi: turning to bank indonesia. ,he rupiah putting a roadblock as the virus continues to batter it. there are concerns about the central bank independence as well. what did we hear from the governor? kathleen: what is really important about what he said, one of the things that is weighing on the rupiah right now, down more than 6% this year, asia's worst performer, is that step. the government wanted to take a bigger role in monetary policy. it may be well-intentioned,

maybe just wanting to have more coordination as the japanese do. this always makes central bank i so the governor said that bank of indonesia has adopted a policy mix geared toward coordination with the government in order for the economy to recover from the covid-19. he said the president and the prime minister have made it clear that monetary policy must remain credible, effective, and independent. in light of that, there was a bounce back in the rupiah yesterday. but with an economy suffering -- in the latest quarter, indonesia's economy was down 5%. of pretty consistent and strong grower. now virus cases are coming back. now there will be renewed lockdowns at least on a partial basis. people are concerned about jobs. so what economists are saying now is that it may keep the door open to a further rate cut by if, indonesia, especially perhaps some less worry about

this struggle between bank indonesia and the government, this quest for central bank independence is in the backseat. and if the government shows it can take these steps with bank indonesia but still leave them as the main driver of monetary policy decisions. kathleen hays, thank you let's look at the markets would sophie kamaruddin. sophie: little enthusiasm to behead this friday, with futures pointing to slight gains. the kiwi dollar is an outlier in the fx corner, pushing higher this morning. heard from the finance minister saying that economy is rebounding. i've made this ongoing debate on whether growth or value will take the lead let's, look at what is going on in the tech space, the fundraising. we are seeing ipos at a quick pace. in japan, toshiba's memory chip

unit is set to raise the $3 billion it was targeting, less than that, but it is still japan's biggest ipo this year. this is a busy week for ipos and also for m&a's. you have lg chem in the spotlight given that it is about to spin off its battery unit. and we have a possible ipo in the works which could take a year. and the bytedance rival backed reportedly is seeking a potential ipo in hong kong that could raise $5 billion. and this company from malaysia could jump on the bandwagon. that will boost equity fundraising in hong kong even before a financial shares sale in the city. that would be supportive for the hong kong exchange. shery: we have a big guests

ahead. we will hear from the world's biggest dairy exporter, fonterra, which has returned to full-year profits. the ceo joins us in the next hour. ♪

haidi: new zealand saw its worst economic slump, as the pandemic brought the country to a standstill. we spoke with the finance minister earlier, and asked whether it is time to reconsider different options to bolster the economy. >> what we are now seeing is the economy using the robustness and resilience we have in the economy, coming back really strongly. lower --ed at a much of restrictions over the last few months. exports are holding up. our economy is looking strong through this period since we spoke. we have continued to deliver our wage subsidy program which ended billion, out about $13 supporting about 1.7 million new zealanders. there has been plenty of investment for us and plenty of stimulus money going across the

economy. now we are moving into much more positive territory in the september quarter. haidi: and yet the rba is considering negative rates. some parts of the market are considering that could happen as early as next year. in a concern about negative rates for the country? grant: obviously, monetary policy in a new zealand is set independently by our bank. they provided the clear certainty to the markets by saying they will not be moving 0.25%, at least until march of next year. between now and then, we have to see the economy stabilize. and as i say, rebound strongly through the next couple of quarters, then we will take that forward.unt as they go around the world, what we used to call unconventional monetary policy is there much front and center. the degree of quantitative easing that the banks have undertaken, things are going reasonably well in the financial markets here. i think there will be all of

all of they will bear that in mind when it comes to the decision next year. shery: will that be enough time, and credit compromise some of the things you are doing giving negative rates? will it pressure banks' profitability, will they be less willing to lend during the downturn? grant: we have a stable banking system here. banks have found their way through this well. they are lending business in large amounts into the economy, the role, as we say by of the news event bank in secondary markets. a long as the economy continues to do well, new zealand will be in a strong position. shery: would it help of the rbn delayedhe further capital requirements for banks?

grant: they made the decision to delay them until next year. the bank balance sheets are strong and historically have been so, so that seems like the appropriate decision for the new zealand back to have madep july gives us for the room for the economy to intensify. shery: you don't see that being extended? grant: that would be a matter for the reserve bank to decide; i'd don't see any indication they are planning to do that. haidi: minister, are you worried about the optics should negative rates happen next year what does it signal to the international investor about the strength of the kiwi economy? and is it a concern that it signals the point where we run out of ammo? the rbn said policymakers have run out of truly extra dinner options? grant: he is not lying about the challenges that a 1 in 100 year shock provide to the fiscal side of things.

those will be the issues that the reserve bank bears in mind. but the economy is a robust economy. exports are up. we have seen good levels of investment enter new zealand from both overseas and domestically. so i think there is an awful lot that changes in a short period of time in the era of covid, but i think by the time we get to the beginning of next year people will see how the new zealand economy is going. rating agencies continue to of u.s. favorably, they know that we have a strong balance sheet and a disciplined approach from a fiscal point of view. i think there is an awful lot of water to go under the bridge before that decision from the reserve bank next year. shery: that was the new zealand finance minister, grant robertson. let's turn to karina mitchell for the first word headlines. karina: more details are emerging about the plan to keep u.s.. operating in the

bytedance and oracle are proving in new york ipo next year if the deal is approved. the treasury, bytedance and oracle have reached terms, but the deal still needs a blessing of president trump, and china which has described the situation as economic bullying. bytedance would retain a majority stake. president trump's executive order comes into effect sunday. the commerce department is still to clarify which transactions will be prohibited. a judge may halt the order for wechat. tencent's stakes are also coming under national security scrutiny. the committee on foreign investment is demanding that the company provide details on its stakes. and tencent will show english premier league games in china, after the former rights holder lost its contract for failing to pay broadcast fees. it will show the games on his digital platforms, including q.com, and tencent

video. english firms have been struggling financially because of the virus. premier league says it will continue to explore airing options. global news, 24 hours a day, on air and @quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am karina mitchell. this is bloomberg. haidi. you, haidi: the selection of jane fraser to become the next ceo of citigroup, and the first female ceo of a major wall street bank, is the latest move by a industry trying to move beyond its history of male dominance. but much work remains in closing the financial gender gap. we have a guest here, lorraine hariton of catalyst, a global nonprofit focused on working to improve gender parity. much, out of the sheer fact we have been talking about this over the past week,, to does it indicate how much work there is still to be done? lorraine: first of all, it is a

watershed moment. the fact that we have a woman finally running a major bank is wonderful. but we still have a long way to go in terms of building a pipeline that is sustainable, where women really have true equity. banks, whileof the you have parity at the entry-level, by the time you get to the middle, you are 25% and at the top, much less than that. banks have been working hard at changing those numbers. i think that intentionality has really shown. jane was really sponsored through a number of really important jobs, she was really qualified and the best candidate to get there, but it has been the result on a lot of work by citi to make it happen. haidi: i think one of the reasons you have a dearth of female leadership candidates in the middle segment, where you

don't have as many of the most promising female talent continue to go through, is that part of the lack of flexibility? it is not just a monetary compensation issue, right, it is the reluctance of a lot of firms to see flexible working practices at something they need to do, as opposed to just the nice benefits? lorraine: what we call the frozen middle that you are talking about, is where a lot of women and people of color is a united states, for example, in progress. it is the result of quite a few practices. first of all, there is a lot of unconscious bias. are --say, there flexible practices to help. i am quite encouraged at the move to flexible and remote that we are experiencing. it will build new habits around that that will benefit women, and catalyst researchers have shown that that is really

important. but there is a lot of cultural issues that need to be overcome. citi has implemented programs that provide sponsorships that do unconscious bias training, that help men in particular, white men in particular, really understand their privilege and help them to become allies for women and underserved minorities. shery: has the pandemic helped start the conversation on these challenges that women face especially having to work, and the choice that they face at home? lorraine: definitely. be have done research in that area. everyone is dealing with the issue, especially as we go back to school. the burden of childcare and homeschooling. both men and women, parents, are understanding that, so it there is a lot more empathy. the need to understand the needs

of everyone and to try to move to equity is really on the front page right now. haidi: lorraine, we really appreciate your time, catalyst ceo. next, uber is battling its cash burn, seeking a stake in a chinese rival. details next. this is bloomberg. ♪

haidi: a quick check of the headlines. apollo management is exploring a takeover of the plastics maker covestro. covestro was spun out of a drugmaker the five years ago. the company sale is valued at around $10 million. new york-based apollo is said to be in discussions with covestro for several weeks. and this bank has offered $3 billion for a 50% stake in five rr. it would pave the way for an italian single national broadband network, a priority for prime minister content. nlco is said to be resisting which mayn the sale also face opposition from the e.u.'s antitrust arm. burger has been approved which would create the biggest lender. the streamlining efforts are set to boost profitability.

the deal signals the start of a long-awaited consolidation in european banking. shery: uber is said to be seeking a partial sale of its stake in a china company, the latest in most by the ride-hailing giant to share of minority stakes to raise cash as well as its stock price. what do we know about these discussions, and what sort of scenarios are we looking at? >> there is a lot of options but they are exploring right now. what we know is that they are looking to liquidate a minority of their stakes in didi valued at $3.6 billion in the second quarter. they actually marked but down from the first quarter by about 1.9 billion. so you see the folly share

price. they also are in negotiations to the logor share in other companies. they also remember, sold off part of their flight operations in europe. -- freight operations in europe. so we are seeing a lot of liquidation right now. strategy?t is the there are all these other sales underway. what is their hope in doing this? lizette: i think the hope is to turn a profit. we have this ride-share company that has big, strong ambitions s, helicopters, uber they were trying to do job-matching at one point. they even have done a lot of things at uber for business, which is still going strong.

the biggest thing we are seeing right now from uber is a concentration of what are their core competencies and what other things they shouldn't spend so much time on, like self-driving, things like that. so they are focusing on bringing the riders back, which have been decimated by the pandemic. they posted their first ever decline in that last quarter. their food-delivery business is way up. the are focused on where they can make money. this represents a lot of locked up value that they are trying to get out of. shery: they got there didi stake when they retreated from beijing. what do we know about their global plans at this point? lizette: they got that as part of their deal but they have been bleeding cash during the are very expensive and expansive push into china. right now globally, like you said, they have these chairs in others.ab and

grabbed is exploring a potential merger with another company. on of these are backed by uber's biggest shareholder, softbank. there is some desire on the part of softbank, which has had a pretty rough year with other investments, not the least of which is wework and it's filled ipo, to try to push up uber stocks about where it was in the ipo in may 2019. share.did $45 a it is hanging at around $36 a share and has really gone above the $45 mark -- rarely gone above the $45 mark. so that is part of the thinking there. haidi: lizette chapman in san francisco. coming up on "daybreak: asia." we speak to the world's biggest there exporter, fonterra. they are cautious about the outlook. the ceo joins us later. plus, we have the market open in sydney and tokyo.

eleanor creagh will be with us to share her trading strategy. this is bloomberg. ♪ ♪ you can go your own way

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asia,"ome to "daybreak from bloomberg's world headquarters in new york, i am shery ahn. >> and i am haidi stroud-watts sydney. asian futures with modest gains after wall street pared the worst of its losses. bank statements reflective the fragile economic recovery. an expedited review for a stock market listing.

what is expected to be the world's largest ever round of fundraising. and we reveal the dire situations around seafarers. many have not set foot on land in over a year. >> australia coming online. let's get straight to the action with sophie kamaruddin in hong kong. are seeingjapan we stocks at higher again ahead of the long weekends. day gain. the boj was pessimistic and suga does not think inflation is much of a problem, the labor report turning negative last month. buyers might be cautious with the 10 year approaching zero and the 20 year yield falling below 40 basis points. let's switch the board to check though and in south korea. we are seeing gains for the kospi by 0.4%, headed for a

fourth weekly advance. two andn has phase three for the vaccines. the korean won is on the korean won is on front foot breaching level, set for a second weekly climb while the 10 year may enter around 1.5%. a good chance the boj will cap the yields. let's check in on the kiwi dollar, and outlier this morning, rising, as we heard from the finance minister, saying they are rebounding. but kiwi rises are under pressure. the asx 200 rising 0.2%. the week, a quick pulse check of where we are with asian stocks. fairly resilient they outpaced global peers and the nasdaq, which has been smacked down by the tech downturn.

goldman warning a bump ahead for asian equities. overweight on chinese and korean stocks as well as tech, customer retail and the health care space. the tech space feeling the love with a string of ipo's this week more potentially in the pipeline. haidi? haidi: in the meantime the fed wants to create more inflation. don'tof policy decisions shed light as to how they plan to get there. the bank of japan has been trying to do the same for years. our next guest says multiple factors are converging to stress test disinflation would let's bring in eleanor creagh. you take a look at the treasury markets where breakevens have been. there is a lack of conviction on how this targeting framework is going to be effective for the fed. we know where the boj is in terms of how successful their

efforts have been. do you think there is a false sense of confidence about inflation not being an issue in the market? eleanor: look, certainly. generations,t for inflation has reached the point where monetary policy is [indiscernible] disinflationary factors due to technology, which is been hard to escape. the covid crisis is disinflationary. we have to look beyond that and see factors converging that have the capacity to challenge the disinflationary pulse. globalization, protectionism, supply chain shakeup, climate change mitigation. we have seen commodity and food prices on the rise, creating inflationary pressures. ambiguity rests with the

demand side. here it is not monetary policy, but the evolution of inflation that depends on the path of government policy and that is where we see a shift from fiscal orthodoxy to redistributive policies. post pandemic conventional policy will be hard-pressed to make a comeback. as we see that fiscal focus continually shifting toward rising wealth disparities, we have the capacity for inflationary pressures to build. that is one reason we continue to hold precious metals and commodities as well. you think that is something an investment portfolio needs to address at the moment, or is it just wait and see? isanor: no, i think it something an investment portfolio needs to address.

potentially one of the most important places to be addressed is the diminishing importance of treasuries in portfolios. we know in some ways the tonside, the fed will try tap yields to sustain the treasury issue to fund deficits and create a feeling to fund themselves. closely, we at that whereby thety, second derivative of the bond price and interest rates, the longer duration makes moves relatively harsh for portfolios or the risk reward of remaining and the upside is limited. on the downside we have inflation that can surprise. that means that holding can potentially be volatile with inflation on the rise and quite painful for portfolios.

in many ways, risk for very little return. haidi: which takes me to our question of the day on m live, when do markets start pricing in negative fed rates? eleanor: we have to frame this. this week the fed has lost its element of surprise. and approval looks increasingly empty at this stage. at zero until they reach an economic heaven between 2% inflation for many years, if history is any guide. we have the question if rates are at zero, where is the marginal trade of the cash flow come from? lead tos eventually control, de facto or explicit. following the negative interest rate to maintain the nominal

expansion of multiples, and the bubble being blown in risk assets, there is nowhere else to go. ultimately, those solutions are temporary and exacerbating problems we cannot escape with present policy. asset price inflation exacerbating disparities, the proliferation of zombie companies, generational divides. that is leading toward heightened volatility. not just in financial markets, but in society with social unrest as well. shery: given all the weertainty, is it reasonable are seeing this support when it comes to precious metals? eleanor: yes, certainly. gold was hit hard earlier this year along with other precious metals. the curve control has set up

this period of reconsolidation. a ripping momentum that drove some are markets. that does set us up for extended consolidation. the long drive will remain intact. we see new yields continuing to decline. and obviously the ongoing currencies along with virus uncertainties. the optimistic projections on a vaccine and we can't forget the mounting alexion risk -- election risk. the longer-term strategic proposition remains intact. shery: great having you on as always, eleanor craig. let's turn to karina mitchell for the first word headlines. >> let's start with the pandemic. global coronavirus cases past

the 30 million mark. the world health organization warns once again of a resurgence in europe. the most cases since the end of the country's locked down in may for the second time in less than a week, more than 10,000 new infections. the northeast of england has tough new restrictions. the highest level u.s. official to visit taiwan in decades made a second visit in a matter of weeks, prompting threat of retaliation from china. evening andhursday is due to meet the island's president, premier and foreign minister, as well as attend the memorial for taiwan's former president. the visit is called provocative. a second round of wall street stress tests, considering extending constraint -- constraints on buybacks. the fed will decide in two weeks whether to prolong the limits on the biggest u.s. bank.

the limits in june were set to lapse in the third quarter. the bank of england may cut interest rates to below zero for the first time in its history as it battles the coronavirus and risk of a no deal brexit. the policy is part of a toolkit market traders are betting the next 10 basis points that easing will come in february with a similar move shortly thereafter. 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 am karina mitchell. this is bloomberg. haidi, you are all caught up. haidi: just ahead, we speak with the biggest exporter. ceo judith swales joins us later. and, trade that needs sign-up

from trump and chinese president xi jinping. this is bloomberg. ♪ this is bloomberg. ♪

>> the u.s. treasury and oracle have terms to keep tiktok operating in the u.s. including possible plans for an ipo but any deal must win the approval of president trump and china. let's get more from our editor, tom giles. just when we think we have clarity and president trump microsoft issses, sealing the deal. become a deal has circus and trump did make a throwaway comment earlier today in the u.s., saying microsoft might still be involved. we spoke to a person familiar right afterwards who said this is not happening, microsoft is not involved. i would not want to our viewers

to get too far down that rabbit hole. what is important, i can bring you up to speed on the state of negotiations. bloomberg broke the news earlier today in the u.s. that there have been changes to the agreement. there was a revised plan agreed upon by oracle, tiktok and the treasury department. what they did in that revision, we do not have all the details, but they are taking extra precautions to ensure the u.s. assure the u.s. government about its national security concerns. as you talked about on the show many times, the u.s. forced the sale because they are concerned chinese ownership of tiktok would compromise national security for u.s. users. , treasury, came up with a plan that would go

further to address those concerns. we hope in the next day or so we will get more details on exactly what they are proposing. already oracle has taken several steps, really attempted to address those concerns. in the meantime the president seems to think microsoft is involved in the fray. inwhat extent are we far off getting presidential approval both in the u.s. and in china? we still need presidential approval. microsoft is not involved, despite his throwaway comment earlier. we do need the president to sign off on the deal. he said he will be looking at it. we thought that would happen today, it clearly didn't. maybe that is because of the changes sent in overnight from tiktok. still needs to approve the deal. nothing happens with this deal if china does not

approve it. bytedance need the blessing of the chinese government in beijing as well. have called this economic bullying, right? tom giles in san francisco with the latest. with --p, and interview about the s&p 500. his take on investing amid the pandemic. pandemic.

disrupted u.s.ty equities in september after a historic rebound over the past five months. beat theff managed to s&p 500 by three percentage points annually for 30 years. he spoke exclusively with

bloomberg tv about investing during the pandemic and how to sustain the index beating game. i would say i feel great about the companies i own. contrafund were extremely well-managed before the pandemic. i think what has been unbelievable and inspiring is how well so many public companies have managed through the pandemic. here we are having this zoom interview. the technology we live with has made this pandemic relatively tolerable for many, many people and companies. i am confident the companies i own will resume their growth and continue to thrive after a vaccine comes out and we can finally slay this unnatural and

frustrating beast we are all fighting right now. i feel good about that. certain companies have benefited more than others. investmentefer companies that are doing well right now. i would say the fund is heavier in the work from home, study from home beneficiaries than not. i have not bet big on airlines or hotels at this moment. they will benefit and do relatively well when the pandemic finally ends. amazon has been an unbelievable well-managed,ly continued opportunity as e-commerce continues to gain market share. think about it this way. who wouldn't want unbelievable selection, great prices and the

convenience of having your purchases delivered literally in a day or two, right to your very doorstep? execute, continues to i am sure it will be a good start going forward. it had a great run and you make a good point. many of the covid beneficiaries have appreciated a lot in the last year. we have to be careful and patient. if you say, what i rather own it for the next 10 years or not, i think it is clearly a long-term buy. >> there is more concentration now in stock indexes than ever before. apple, microsoft and amazon account for almost 30% of the russell 1000 growth, for example. to positionrrier size for you, or are you willing to concentrate the contrafund even more than the index, if you

like the stock enough? >> we are in a funny time when the big companies seem to be very well-positioned. accrueresumably will their profits going forward. isvery big companies, it harder to grow very rapidly over time. if you are a $2 trillion company like apple, maybe you can grow 15% a year for the next five years, but probably not 50% a year. that i think is a bigger challenge for a fund like mine, to invest enough very fast-growing companies to make a difference. >> do you worry some of those companies, amazon, facebook, alphabet, are getting too big and might be targets for regulation or even antitrust action, if there is a democrat in the white house? >> i agree with jeff bezos on this point that big companies

should be monitored. that is a good thing. it is important to have governance and regulators making sure big companies are doing the right things and operating fairly. i worry that regulatory bodies and press concerns become a distraction to management. my company executives to be focused on their customers and trying to delight their customers. i do not want them distracted by having to speak with congresspeople, respond to rumors and this sort of thing. so yes, i do worry about that. contrafund danoff, equity manager. let's get the latest business flash headlines. australia's bank offered $3

billion for a 50% stake in open fiber. it would pave the way for an italian single nation broadband network, a priority for prime minister giuseppe conte. resisting pressure to the sale, which may face opposition from the antitrust arm. arrival considering a hong kong ipo which could raise as much as $5 billion. it is the biggest rival to their domestic version of tiktok. the chinese start up backed by tencent, began in smaller chinese cities and rural areas before expanding. it claims to have over 100 million daily active users. china's number two a one planning billion-dollar hong kong ipo this month. hong kong has seen a parade of biotech firms go public, while

health care companies have raised $13 billion through share sales in asia. breaking a 12 year record. chem says they will keep a controlling stake in the top electric car battery maker. bloomberg's transportation reporter has been tracking this from singapore. spinning off its battery business? >> right now it is part of the bigger lg, which has other businesses including petrochemical, advanced materials and pharmaceuticals. considering that going forward ev demand will be on the rise is likely to see growth going forward. this would thought

be the best option to maximize investor interest, but also open up opportunities for financing for the battery business itself, given there has to be a lot of investments going forward to keep their market share. >> one of the worst performers on the kospi yesterday, what happened? chem has beenw lg seen as a battery player, not petro company -- petrochemical company. they gained so much interest from investors. ev demand has been on the rise and the focus has always been on ev. lg chem has been the beneficiary of that sentiment. now the company is planning on spinning off, that means lg chem will no longer be a battery company. >> we have to leave it there. thank you.

more on the corporate push to go public as a fintech group awaits regulatory review in what is expected to be a record offering. this is bloomberg. ♪ this is bloomberg. ♪

♪ >> this is daybreak: asia. i'm karina mitchell. are emerging about the plans to keep tiktok operating in the u.s.. they are planning a new york ipo next year if the deal is approved. the treasury has now agreed on terms. any new company still needs the blessing of president trump and thea, which has described transaction as economic bullying. in other news. the u.s. says people who use we byt won't be targeted

president trump's executive order which comes into effect on sunday. the commerce department has to clarify which transactions will be printed -- prohibited. a judge may yet halt the order. tencent is gaining stakes. national security scrutiny. they are demanding for its 40% stake in epic games. it will show english premier league games in china after pb tv lost its contract for failing to pay broadcast fees. tencent will show the rest of the seasons games on its digital platforms. they have been struggling financially because of the coronavirus. the premier league will continue to explore options. oil posted its biggest three-day advance since may after saudi arabia renewed calls for opec-plus members to it here to

production quotas. saudi arabia condemned the cartel members who cheated on russiaion quotas and got to say the group should strive for high compliance. news 24 hours a day on air and on bloomberg to take, powered by 2700 journalists and analysts in 120 companies. this is bloomberg. back to you. >> let's take a look at how markets are shaping up this friday. sophie: tgif. we have stocks mixed across the region. the regional index could be set to halt a two day decline. in the tech sector, the software firm outperforming hardware. ipoy software pricing its above guidance. steam, leading the advance on the kospi. that's adding 1% so far this

morning. leading g10lar gains this week, rising for a sixth straight session after the finance minister said the economy is rebounding. they will keep the cash rate steady through march. the korean won is trading below 1170. the strongest level since january 23. the offshore yuan is testing that again. strategists go back to the drawing board. the hong kong dollar staying near the strong end of the range. cash demand increases as the ipo pipeline goes in the city. a very busy week for ipo's. toshiba is set to raise $2.9 billion in japan, less than was argued. it will be the country's biggest ipo this year. malaysia's growth is considering

a share sale in hong kong. china is eyeing a listing on the shanghai market. this amid the race we are seeing in the eve m space. sherry: regulator set to begin a review of an ipo application. facing ach giant is barrage of recent rules ahead of its mega listing. sophia or tyco's to joins us now. give us details of what this review is and what we are expecting. >> good morning. this is the shanghai stock , deciding today. we expect a decision after market. they are meeting at 9:00. deciding whether or not to approve the ipo in shanghai.

basically everyone expects the approval to go through. this was a pity fast review for china. shanghaid their ipo in on the 20 for's of august. it's less than a month that the decision comes through. way of listing on the mainland. it's a registration system. last yearen effect and this year more broadly. before this, up -- ipo's could take years. timemonths was a normal for these. less than a month is pretty quick and really shows that regulators want to expedite this one. shery: if it is being fast tracked, do we know what comes after the approval? >> -- sofia: this is a big one. this is the one that matters. sentaperwork get sense --

over to the securities watchdog. that's essentially just a formality. once the stock exchange approves it, it's about getting approval. two's expected a week or after the approval from the stock exchange. the tricky bit is we have a holiday in china. the national day followed by the autumn festival. that may delay things a bit. all in all, we are looking at maybe a listing as soon laid october. it could be pushed back to november depending on how long the paperwork takes. likees look that's -- that's what the hong kong stock exchange is looking at as well. what we are hearing is that it's and isthat the ipo's -- also listing in hong kong at the same time. we expected to happen on the same day or one or two days apart. japan's largest secondhand

market operator is one of the few businesses to benefit from coronavirus lockdown. trading volumes surging. bloombergoke to exclusively about the pandemics impact and the targets of the company's u.s. business. people were spending atstantially longer hours home during the state of emergency in japan. we had a surge in the volume of merchandise for sale. people were confined to their homes. the number of buyers also increased. i would say that the stay-at-home order has a positive effect on our japanese business. the same could be said for the u.s. market. the lockdown in the u.s. was much more widespread and strict. users flocked to our website for non-essential merchandise like

games, books, and clothing. retailers like amazon worshiping out only the essential items. the resulting jump in the trade volume was huge. in the u.s., their home orders increased online sales versus the total retail sales volume. that trend has continued. the $100ng of u.s., million monthly dmc was set as a target for a long time. up as the point where you can go profit will. what's next for the u.s. business? >> the monthly gross motion value of $100 million has always been our strategic goal. we regarded as a breakeven point for the u.s. business. even though we achieved our goal in the last quarter, the business is actually not profitable yet. we are not profitable only because we still continue to invest in the u.s. market.

we believe we can propel our numbers to 200 million or $300 million. we are carefully monitoring the economic situation there and we were either make additional investments or shift focus to profit ability. we are putting all of our efforts into approving -- achieving the best outcome. >> with the change of leadership in japan, what are your expectations for the next prime minister? can you tell us your outlook for the japanese economy going forward? i think we can expect policy continuation from the new prime minister. mr. cipollone has worked under mr. abe for his whole tenure. it's not easy to have a clear read on how the pandemic or the economic recovery will play out from here on. for me, the coronavirus is a bigger worry. the impact spares no one. it's debatable how much more the government can do. it is faced with an extremely

difficult balancing act of curbing the infection rate and keeping the virus contained whilst trying to bolster the economy. we appear to be seeing the downward trend. my hope is that the current policy will remain unchanged. ceo there.uarrie up next, our interview at the world's biggest dairy exporter. the asia-pacific ceo joins us next to talk about the outlook after the company returns to profits. this is bloomberg. ♪

>> the world's biggest dairy exporter has swung back to a profit. 659 million kiwi dollars for the financial year. 45% rise from a year ago. the group cautioned that the outlook remains high. in the ceo who joins us now. great to have you with us. thank you for your time. congratulation on the results. how interesting of a year this has been. what does the pandemic mean for global milk demand? >> it's good to be here. it has been a year of two halves. we had a great start to the year and then we came into the pandemic.

that was coupled with things like drought and parts of new zealand, brush fires in australia. we think that it's pleasing to see that the results have held up. we are pleased with the year. we are cautious about what we are facing. things are holding up ok. we have still seen part of our business impacted by covid, particular are fruit service business. in china, it rebounded in a healthy way. across other parts of asia pacific, the food service business is still taking it's time to come back. that has been offset by consumer business. we have people cooking more at home. we are seeing good demand growth in terms of things like cheeses and butters and creams. one of the benefits of our structure is that those are the different channels that we have. >> tell us about that

optionality. what is your strategy going forward giving -- given these uncertainties around the world? are you thinking about cost-cutting? what is the strategy? our strategy at year ago. much more market and customer led. we are now organizing to go to market regions. that's allowing us to be more demand focused and to really focus on driving demand. we are absolutely focused on our consumer business where we have it. on our food service business. we've seen the rebound in china. china continues to perform really well. if you look at are over results, food service profit grew 14% for the full year. we are confident we will come back. we are partnering with our major customers across our food service business make sure that when they are ready, we are ready to go. ,e are expecting and preparing

we may see some price contraction with customers and retailers. if we go into recession, while it's starting to -- wallets start to tighten up. we will adapt to that shifting demand. we are planning for the worst and hoping for the best. fonterra topect benefit because of its new zealand roots from the australia china trade tensions we are seeing? how much of your future growth do you expect to come from the chinese market? judith: the primary license, the primary source of product is between new zealand and china. that has long been the case. we have great relationships there. 90%ne stage, we worshiping coming from new zealand. thus the primary relationship.

supplement that with australia. australia is more of a partner to the japanese cheese market. we have that arbitrage opportunity. china is continuing to see growth across our food service business. our consumer business has been impacted by the disruption in hong kong. mainland china is continuing to see growth in consumer demand. china is definitely the focus for us. as are other parts of the asia-pacific. asia, dairy is becoming part of the regular diet. we are starting to see consumers and customers trading up across southeast asia. we use china. we are diversified. i think that puts us in good stead, particularly during the challenging covid-19 times. >> challenging chimes for the

economy which has not seen a situation like this since the great depression. are you in favor of more monetary policy stimulus? we've been talking about negative rates a lot. do you see any impact on your business from that happening? i imagine you want a lower quibi. -- kiwi. judith: we would. we prepared for any eventuality. commodity riskdo and trading, we are looking at how we can de-risk our business. consumersike to see more confident and out and about, eating out. anything we can do to make that happen will be good for the demand side of our business. we continue to monitor that very carefully. sure we have the right product lineup people to respond to that consumer demand profile.

>> how much have you benefited already from pressure on the quibi? judith: yeah. i can't comment exactly on that. we have seen some benefit. also, the dollar was really low. that has bounced back up. it is such a volatile time at the moment. we are cautiously optimistic. very cost-conscious, making sure we keep everything under control. we just prepared for things getting better, getting worse. we need to be prepared in any case. >> how important is it that driven, remains value even more so than just volume? it's actually the fundamental strategy. it's why we are investing in things like our function will --

functional nutrition unit. advanced ingredients. medical nutrition. our pediatric business as well. margins.the premium that's where the value is. that's where the consumer proposition comes from in terms of more protein, probiotics, lipids. fats. that's where we see the command margins. that's where the innovation comes into play. that's where we are focusing. we know that health and wellness continues to be a trend even when wallets become tight. people need to stay fit and healthy. mentally and physically. dairy helps in all of those cases. that's where we are focusing in terms of that kind of advantage. >> as new zealand heads to the polls, what is your list of

policy priorities that you want from the new government? judith: we obviously want -- it's about our farmers. making sure that our farmers have sustainable businesses. we are looking at what the impact of climate change, carbon trading schemes, how we make sure that we have sustainable farming operations so we can keep milk flowing. we are a dairy business. we need milk production to remain strong. the policies around how environmental factors, carbon are at the top of our agenda. >> it was great having your thoughts. thank you so much for that. up next, we look at how the pandemic hundreds of thousands of workers at risk. not necessarily from the virus itself but from labor violations and mental and physical health issues. this is bloomberg.

♪

♪ >> hundreds of thousands of workers are stranded on merchant ship's due to the pandemic, putting them at risk from labor violations and mental and physical issues. senior reporter has more on this exclusive report. this is something we weren't actually expecting or watching closely.

give us the latest on the situation and see. -- at sea. >> most of us have been at home because of the covid-19 pandemic and ordering items on amazon. not really thinking how these items are getting to us. how they are being transported. not really aware that there's a humanitarian and global crisis on the seas right now. we depend on 1.6 million seafarers who work on oil tankers, cargo ship's to .ransport everything we use because of the pandemic, governments have closed ports. travel has been curtailed. that is stopping crew on the ships from getting home to their families. we found that there are some 300,000 crew on ships who have been stranded on these vessels. they can't get off. some now for as long as when one months. this is months after the contract ended. this crisis is likely to get

worse. >> what do we see in terms of efforts to help them get off of the ships? oanh: it's a patchwork of things. there's companies responsible for every ship and its crew. you also have agencies that recruited them. there's the ship manager that runs the crew on the ship. the charter whose goods are being transported. some of these companies are working with the port authorities and government to lobby them to ease restrictions at the ports and borders to get these guys home. right now, they are saying that some ports have opened. there are lots of restrictions. it's difficult to get these guys . many are still stuck on ships. we have seen some companies divert their ships to the nearest port. sometimes it is thousands of miles away. the reality is that not enough companies are doing it. it's too expensive for them.

it may delay shipment. that's the problem. we did not get a chance to talk about the conditions that we are seeing on board. bloomberg reporters spoke to more than 40 seafarers on various vessels. we found some really troubling violations of international maritime law. the protections for the seas fares -- seafarers are no longer there. they are so desperate that they wanted to tell us their story. are workingof them on ships without a current contract. total violation of maritime law. they are being threatened to sign contract extensions. they feel they have no choice but to do so. they may not get rehired again. they are not being paid for their work. sometimes two months without pay. it's a very desperate situation for these guys. it is bound to get worse before it gets better. >> what does this mean

eventually for consumers at the other side? oanh: that's a good question. unless we get these guys off of the ships, some of them will stop working. we've already seen that. because of the violations. the ships are being held at ports by authorities when they find the violations. this means that if this problem isn't solved, products will come to us. us.on't come to trade will get disrupted because these guys can't get off. their replacements can't get on. that will be disastrous for companies, consumer companies. we are ahead of the christmas season. might be a really choppy christmas season with trade disrupted, products not coming. ♪ ha there on that story. coming up next, more market analysis with ben emmons.

that's it for daybreak asia. market coverage continues. we look ahead to the start of trade in hong kong, shanghai, shenzhen. ♪

♪ >> it is 9:00 in beijing and shanghai. theome to bloomberg market china open. i am tom mackenzie. david: we are counting down to the open. last session of the week. our top stories this friday. tencent in trump's crosshairs again. the administration wants to know more about the chinese tech giant. we await clarity on the wechat pay am.