[applause] ♪ >> good morning and welcome to "bloomberg daybreak: australia." i'm paul allen in sydney. bloomberg'sing from world headquarters in new york. >> the u.k. faces christmas payoffs with london under tough new virus restrictions and europe closing the door to british travelers. and brexit just days away with

no deal insight. states are closing borders. the lastakers cleared significant obstacle to a new relief deal paving the way to new agreements and relief. and joining the s&p 500, tesla. a major change in business strategy. putting half the balance sheet on bitcoin. >> let's see how things are shaping up for the asia markets as we had to the open on this monday. christmas,ore trading -- the regional benchmark capped a seven weekly gain. is having its third

rise in four weeks on friday. resource -- mining stocks. 200 looking at a potential lawsuit. and a sydney outbreak. let's go to the boards. keeping an eye on the pound edging towards the 1.34 level. as the brexit talks miss another deadline. and the london lockdown adding to whaoes. -- crimeoan product rate announcement. also gauging a reaction to donald trump signing a bill that delist chinese stocks in the united states. coronavirus outbreak in

sydney has a new limits introduced on gatherings over the next three days. to theest is linked beaches area and involves 66 people. what went wrong? paul.lo, it is the question everyone is asking. no one is entirely sure what went wrong but it will be a real new for contact tracing to south wales. it looks like it could be linked to a u.s. strain. it is good in that we have most of the local cases. contactmething that tracers are scrambling to uncover as we head into the holiday season. it could not comment at a worse time. >> especially when you have two

weeks of nonlocal infections. what does it mean going forward? how fast is it spreading? is mainlys like it contained in the northern beaches area but we have already below,ses the affected here in sydney. it could have the potential to be a super spreading disaster. and it may not be known for another week if there are other cases in sydney. really hard to determine at the moment. the fear is that it will erupt into a melbourne like situation. only a week or two, melbourne was in lockdown for three or four months. >> what does that mean in practical terms for sydney? how strict are these measures? >> at the moment, the northern where the the area

most cases are and it is in full lockdown at the moment. they are not allowed to leave their houses but for shopping. sydney means that residents cannot visit family for christmas. the state health commissioner came out and said plans would go ahead as planned. they are walking the situation -- they are watching the situation daily. at the moment, it it looks like stricter lockdown measures could be on the horizon. >> the latest on the australian infections. spreaddemic continues to around the world and london has been placed in emergency bottles as the u.k. reportedly new strain of the coronavirus. several european countries have banned travel from the u.k. for the latest on the global coronavirus situation, we are

joined by ian fisher in new york. what do we know about this new strain? enormous amount. the virus is always changing. they are always coming up against different forms of it. this particular strain seems to have caught hold and they say it could be responsible or as much as 70% of the infections around london and to the south of enormousich is an amount. millione gone from one up to two million. it is a dire situation. the who is working closely with the u.k. to see how this has mutated. they think now that it is not

more deadly and it will not matter in terms of the vaccine. that is good news. we have seen a shut off of travel links with the u.k. what has been the reaction in the u.s.? saidthe u.s. has basically it is fine. reason to see any impose any restrictions at the moment. we will see if that changes. right now, we don't know any this mutation. one has shown up in italy. there are hints there are some in south africa. that it isthe extent in the u.k. is thedest voice so far european government that came on

a news conference today saying there are six flight coming in from the u.k. of untested people . he is very much worried about a repeat of the large spring outbreak which also came from europe. he begged the your -- the federal government to do something about that. >> we know u.s. regulators have just cleared moderna. this is a young company. this is the first product from the company to be cleared i regulators for use. what do we know about how capable it is to -- they are to meeting expectations? ian: they have no track record at all. --y are working with hyper they are working with people who are very experienced with this so you hope things go well. channeltribution is veryups and fedex

similar to what happened with pfizer. 6 million doses are going out tomorrow moderna. another 2 million from pfizer. to get to your question it is unknown. the company itself has no track record. the distribution networks which includes the logistics arm of the u.s. military to some extent does have a track record. we will see and hope it goes well. fisher in new york. let's know over to karina mitchell with the first word headlines. >> the operable word is movement. lawmakers clearing the last significant obstacle to a relief bill. that clears the way for an agreement on a plan which is worth about $900 billion to help the american economy weather the storm.

congress will add a government spending plan. china is threatening countermeasures against u.s. moves to blacklist more than 60 mainland companies as tensions threatened to escalate in the final weeks of the trump presidency. businessng foreign with a shanghai chip company the latest. brexit talks may extend to christmas despite sunday being said is the latest deadline. sources in london say negotiations will continue. reports say france will veto any satisfy thees not expectations of europe's fishing industry. and tesla is about to join the s&p 500 later monday with elon musk thinking about converting part of the balance sheet into

bitcoin. he says he is tempted i bitcoin tripling the -- by bitcoin tripling this year. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm karina mitchell. this is bloomberg. shery: a daily turnover has boomed since it was announced the tesla stock will join the s&p 500. we will discuss if the price will go higher. computer training corporation says real stimulus is unlikely to come in the u.s. ,he chairman and ceo

shery: optimism pushed u.s.

stocks to a winning week but that optimism will face challenges in 2021 according to our next guest. ceo ofboorish is the computer trading corporation. we do have the vaccine rollout underway right now and we could see a stimulus package soon including an agreement. i would not exactly call it a stimulus package. it is a relief package. it is pretty small. some holes for people that are really suffering in this environment. i would also say that the way we interpret it, price makes news and not the other way around. the fact that equities are hitting some new highs, we tend to be optimistic but when we look at the underlying fundamentals, we see jobless claims rising in the last few

weeks. in the early part of the year, the best thing is the seasonal .trength in january i am concerned once we get past the first few weeks, mlk day, that the fundamentals will show some weakness. talk about the economy especially when it comes to the dollar because we continue to see weakness and as we see the new biden administration coming with janet yellen. what would that do to the trend? peter: dollar weakness tends to support export markets and some of the s&p 500. itself is not particularly strong in terms of

its domestic policies. has alwaysstorically been in favor of a strong dollar policy and our trading partners are not going to want to continue to see the strength of their own currencies because that hinders their exports. this is a long trending market to the downside which has followed the s&p to the upside. i think they both will be reversing. dollar-yen, think about that, back towards our. -- par. bit about's talk a one other aspect or asset right now. a disconnect when it comes to fundamentals. tesla. it is joining the s&p 500. the new chart showing the daily turnover since we heard about

its inclusion on the s&p 500. what will happen to the s&p 500 given that this is the fifth largest company on the index once it joins? saying --m fond of .othing succeeds like success if tesla goes up next year, half the percentage it has gone up this year, by the end of next year, it will be more valuable than apple. that works. it does not mean it has to go down a tremendous amount, but it tons it is likely appreciate. this is a market that is celebrity driven. a celebrity ceo. we have seen that if they do not deliver, the markets come back and come back painfully and that is the risk for tesla.

tomorrow, the news is out, it joins the index. all of the marginal buyers are probably in and i don't think it has much upside at all. when it comes to trading, i thought we were supposed to buy low and sell high. now, everyone wants to sell higher. shery: interesting point. we have seen in the past other afteries losing ground joining the s&p 500 after the initial euphoria. another segment of the market is seeing a lot of upside, the commodities space. havechart showing how we rallied when it comes to commodity prices. this is the bloomberg commodity index. is there any opportunity and the commodity listing at this price point? peter: i think so. particularly in the more tradable commodities like

soybeans and coffee. you have supply chain disruptions and climate change with supply and demand dynamics and particularly the case of brazil which has not been in the news so much but if you follow it, the coronavirus is bad. china has been pre-purchasing u.s. soybeans. it reminds me of russia buying soybeans in the early 1970's. i think soybeans will make record highs. had two category five hurricanes disrupting supply chains in central america. out frome reports brazil last week. prices could double. but tesla is up six times this year. shery: anything is possible. peter borish, great to have you.

, maintaining economic stability as the u.s. blacklists more chinese mainland companies. we have the details next. this is bloomberg.

paul: the top planning body is planning to maintain stability while boosting internal demand to create a robust domestic market. joins us with more on this. what are the details of the plan? tom: this came from an annual gathering of top leaders to focus on the financial and economic priorities for the year ahead. from theave heard is commission. what we have heard is the

emphasis of a change of language from last year in terms of how they will handle the monetary and fiscal response here in china in 2021. they say they will make it a more reasonable monetary policy and any fiscal plans will have to be sustainable. it underscores this view from officials that the growth is on a relatively solid footing now in terms of the economic recovery with the virus under control and there is now a switch in terms of focus to get back to that issue of leverage, that promises been -- debt, sustainability. some analysts say they will moderately remove the policy particularly the support for local government finances. officials have been very concerned about the default we have seen, high-profile ones. emphasizing that given that the economy seems to be on a solid

track, they will start to gradually remove that support next year. blacklistings. more chinese companies including a top chipmaker. : the u.s. signing off on an additional 60 plus companies. have hadhese companies human rights abuses according to the u.s. listf the companies on the is smic. this is one of the most significant chipmakers here in china. the government had been hoping it would lead the way in the development of sophisticated semiconductors and help china become less reliant on the import of chips from the u.s. and taiwan but particularly the u.s. given the tensions between beijing and washington. we heard from smic over the

weekend saying in the short term, this will not affect the business too much of particularly finances. longer-term come it will have a major impact in the development of more sophisticated chips. they say they will continue to work and consult with the u.s. government but this is clearly a big blow to a company that beijing had been putting a lot of hope on. beijing has said it will come out and retaliate against the u.s. for this list. paul: let's get a quick check of the latest headlines. u.s. lawmakers are said to be ready to endorse a program to -- from american carriers. the move comes with intensifying concern about national security and that $2 billion will be set aside for emergency broadband relief.

households will receive $50 a month. getting ready to hand over part of the ant group, jack ma. the dow jones says he has had jack ma.h going head-to-head with the pboc and regulators. in indianutting supplier on probation and suspending new orders after alleged labor practice issues triggered rioting last week. is the first iphone maker in india. it failed to properly manage working hours. blame rapid hiring. shery: here is a picture at markets. kiwi stocks under pressure.

down 0.25%. coming as we continue to see kiwi stocks losing ground, it is a two-week low at this point. the kiwi dollar following it -- falling against the u.s. dollar for a second session. the new zealand government just approved funding to eliminate covid-19. we see confidence pretty high in new zealand whether it is consumer confidence or business sentiment. sydney futures. under a little pressure. after we saw the aussie dollar fall against the u.s. dollar as we have the west dollar gaining for the first time last week. we continue to see pressure in australia as sydney scrambles to contain an outbreak of covid-19. japanese and korean futures also under pressure. coming up, u.s. lawmakers may be relief packagea

after clearing the last significant obstacle. this is bloomberg. ♪ ♪ ♪

if you are watching daybreak australia. chaosk. faces suspected and mainland europe shutting its doors. the netherlands, belgium, and germany have suspended inbound travel to the u.k. as a government reports a new virus mutation and cancels christmas. 14 million britons must stay restrictions are imposed on london. in sydney, it is reported

infections spiked. social gatherings are being suspended until the 23rd of december. to 10ings are limited people. at least three states are imposing broader restrictions ahead of the christmas celebration. opec and its allies continue to debate oriole strategy with iran and russia to hold talks on monday. leading members of the cartel and its allies say they intend to react faster to market changes and take a more hands-on approach with an accelerated schedule of monthly meetings. todi arabia says they aim drive the market themselves, not speculators. the next meeting is set for january 4. the death toll from the powerful storm and fiji has risen to four with at least one person reported missing. it spared the capital and a major tourist hub but cause widespread damage elsewhere. the government has almost 8000 people are still in rescue centers with relief aid being

flown in from australia. the storm hit fiji with wind anting up to 345 kilometers hour, that is 214 miles an hour. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm karina mitchell. this is bloomberg. paul: u.s. lawmakers have cleared the last significant obstacle to a deal with a compromise on federal programs. that clears the way for a final agreement on the plan worked about $900 million to help the economy whether the coronavirus pandemic. ross present he has the latest. what are you hearing? a busy day on capitol hill. it finally seems like lawmakers are coming down to the final, final details but we still don't

know if there is going to be a vote tonight or if it will be .ushed to monday there are lawmakers in the juste talking about funding the government overnight basically in some talking about a one-week extension to give themselves plenty of time. it was the fed lending powers that was a big sticking point and that was really settled about 24 hours ago, but at the same time, there has been discussion about emergency jobless aid, the size of checks that will be sent out to many americans, so still a few issues , but it seems like it is possible we will get a vote tonight or maybe monday. shery: how soon can americans start getting those checks which, as you mentioned, we don't nearly -- don't know the size of those checks as of yet. tell us more about those details

that need to be ironed out. we keep getting headlines about surprise medical bills not being included in the final legislation. what do we know? and it really is amazing this bill will be hundreds and hundreds of pages, souls chances are lawmakers will be voting on something they have not really seen and have not really red. they know from the broad contours, we are looking at probably stimulus checks or help checks to many americans, 600 dollars or so, it could be a little more. advisory team is not really involved in these negotiations. the government entities went through this all in the spring, so they are going to send money to the same people below a certain cap of income and

children. the second time around, it should be somewhat easier and supplemental unemployment someits to be paid and negotiations on how many weeks of extra benefits will be approved. could be 11 weeks or 13 weeks? then to just keep the bill under a certain cap. we have been talking about $900 billion. republicans might have a goal of keeping it under $1 trillion when all is said and done. shery: we continue to hear from senator john thune saying a seven-day continuing resolution seems a little bit long. let me turn to another issue plaguing washington and that is the suspected russian hack on federal agencies and private companies. what do we know on that front? we are seeing conflicting signaling coming from president

trump. ros: as he so often does, movedent trump expectations yesterday when he tweeted why does everybody say it's russia? maybe it's china. basically cyber experts in the government outside all identified the hack was coming from russia over the past weekend secretary of state, michael pompeo, said in a radio interview friday night. so trump's tweet was kind of byprising and was criticized democrats, as usual, and some republicans because we saw mitt romney today saying it was a little unusual. isically, it seems like this one of the largest if not the largest tax and i think various government agencies and others are trying to clean up the mess and figure out what has been accessed and what might happen next? has there been classified

information obtained? what is the end goal of this hacking and it could be weeks and months and maybe we will never really know in public exactly what happened. shery: we are just trying to grab the -- grasp the magnitude of it all. gears up next, tesla to join the s&p 500. iswill ask our guest what continuing to drive the stock ever higher. this is bloomberg. ♪

shery: time for morning calls ahead of the asian trading day with sophie in hong kong. the dollar has slumped below its five-year average. what are some of the calls we are seeing before the holiday season? certainlyllar bears getting their moment in the sun and at goldman, they have lowered their greenback forecast . as fed easing ways on that, the key risk to their bearish view has been diminished on lower for longer base as we saw at the latest fomc meeting. an analyst at deutsche bank is predicting a floor for the dollar, so a divergent view

that herde, saying immunity may be a low probability event. a successful vaccine could cause the fed to cap rates, leading them to a stronger dollar and optimistic -- and optimistic scenario which is likely to not be seen for at least three months. asia let's take a look at credit. several funds are bullish there. why is that? sophie: we've seen that area and some hefty returns maybank pointing out the credit is still cheaper, especially in a subzero environment. switching out of the board, john stover at tribeca saying the economic data in asia doesn't

support the misconception that credit in the region is riskier than other regions. 1/5 of his funds is in chinese property development, so he is buying on the depth. dip.ying on the shery: we are getting mitch mcconnell saying a deal has been reached on the covid-19 package. you are watching senator mcconnell speaking right now in congress. the way.ore help is on americans have been waiting for that new round of stimulus measures in order to help them as we continue through the expiration of several government programs. there has been some conflict over the future of the federal reserve mortgage and lending programs. we have heard that has been mitigated. they had another short continuing resolution, given this really fade will be

attached to the $1.4 trillion in fiscalent spending for 2021. mitch mcconnell saying the leaders are detailing the pieces of the bill that they are not mentioning specifics on dollar bills or surprises yet. mitch mcconnell saying we do have a deal. it was a negotiation between democrats, republicans, and the treasury department with the white house weighing in. this has been going on for months and finally there is a nether stimulus package on the way of nearly $900 billion. you are watching senate majority leader mitch mcconnell speaking in congress right now. we will get you more details as we get more on the stimulus package. tesla begins a new era on monday as shares debut on the s&p 500. enthusiasm for the stock did not miss a beat as shares rose to

another record on friday ahead of that conclusion. of tigris financial partners follows that closely. superlatives abound here. tesla will be the largest company added time of addition with a 2% weight on the s&p. what are the broader risks for the s and p? it has been an incredible run of the stock and now, going forward, to sense -- two dollars of every hundred dollars going to pay the s&p 500 index fund or etf, of which they are the largest type of index funds stop you will have a considerable amount of money that will be needed to be added to tesla and that is going to drive the shares higher or at least move the stock higher along with the

s&p. as far as the company, they have a number of other catalysts. they have the cyber truck pickup truck coming, the semi-long haul truck, the solar shingles, the battery walls, other technologies they continue to introduce. so there are a lot of drivers. the tough thing has been the valuation and volatility has made it a tough stock to buy but you can never count elon musk out. he continues to deliver and people that buy the car love the car. they tend to be shareholders or become shareholders, so there are a number of catalysts. you can look at the valuation that tesla is as valuable as the entire global auto industry, but they are not just a manufacturer, they are a retailer, they own all the retail stores. that makes it a little different.

their margins are greater than the other manufacturers. and they envision themselves as a battery company. they are a solar powered technology company, so they have other things that tie into the thea car and over time, all manufacturers are going to ramp up production and introduction biggestrs and the competition to an electric car is a gas car, not other electric cars. the more electric cars that are produced, more electric cars will be sold. tesla will benefit from that as well as, overtime, the battery technology will improve, they will last longer and go farther on a charge, it will charge faster and there will be more places to charge them. is possible to lay out a compelling bull case and you have just done that, but when you look at the fundamentals,

while you were talking, we were of teslat a chart stocks. it's like a hockey stick. as this rally continues, it's going to be worth more than apple. at what point does this get too giddy for even the true believers? ivan: you could have said that at any one point in time and the valuation is extremely optimistic and it has been for some time. not only have tesla shareholders made a lot of money, the short-sellers have lost hundreds of billions of dollars trying to short the stock. i have said for years do not short elon musk. everybody likes the car. they like the ceo, and they like the stock. those are powerful forces, whether they logically make sense or not. not everything in finance is as logical as it should be.

and now you have it as part of the s&p which took some time to add. it inhought about adding september and now they added it a few months later where the market value increased significantly from that point. shery: then the question is should this be the right point in time when you enter this stock and start buying it? we have seen in the past other examples of companies that have been included, take berkshire hathaway for example. the largest, it was company added and then we saw them underperform in the following year. are we going to see something similar given the expectations that have already been priced in? ivan: that is a risk. that is an issue. sometimes stocks correct by not going downward but going sideways. i'm very bullish for 2021 and u.s. stock market and there's

been a lot of enthusiasm and a big run-up in tesla stock. yes, there is some risk of it pulling back but the inclusion in the index and the new so we will have to wait and see because you could have seen at any one point in time it was too high before the split. i have a neutral on the stock because it has been a hard stock to buy because of the valuation of volatility but the benefit of the doubt goes to the upside every time because of investor and enthused -- investor and consumer enthusiasm for the company and its ceo. shery: yep so many investors going into tesla because they are joining the s&p 500.

will they be cashing out of other places? could we see a broader market impact on the s&p 500? ivan: they had a rebalance and some other things but i'm an active manager and active investor advisor. been a investing has powerful force in a lot of stocks and the stock market. i think we are seeing a little of a move away from passive investing because there are so many active things and stories the underlyingt fact that now exists is tesla is part of the s&p 500, two cents of every dollar going into an we see a bigd investment of new money that always begins at the beginning of every year that goes into index funds as people start putting money in their pensions, 401(k)s, etc. that tend to be

indexed. especially on a large, defined benefit package. having youas great on. thank you so much and happy new year to you. tesla, kathy woods is a well-known bull on the stock. woods spoke exclusively to bloomberg on her call for the price to hit $4000.

>> we were astonished at the backlash. part of it was elon's personality and the things he was saying on twitter. and he provocative soul is brilliant. he is our renaissance man and all we did, which is what we should have done in terms of our research is keep our eye on the prize. do withprize have to the autonomous taxi network we believe texas -- we believe tesla will be in the pole position to dominate mostly because of its advantages in artificial intelligence and the amount of data it has collected and the ai expertise that has. we couldn't believe no one wanted to listen and they made fun of it. feel moree me strongly about tesla. what we saw happen over time as

the naysayers were growing was tesla's barriers to entry were increasing. there battery technology was already three years, now it's four years out of the competition, especially now that they are going to build the battery into the structure of the car. they have the first ai chip -- manufacturer has an artificial intelligence chip. they have 15 billion miles of real-world driving collected. has 25 the next closest, million. the winner in autonomous is going to have the most data and highest quality data. at company right now is tesla. then, our confidence was high they were headed in the right direction and as the afterers grew, it was

2018 into 19 as the stock was sayingng as many were tesla was going to run out of money, which i thought was a ridiculous concept. the only time a company like tesla will run out of money as if the markets shut down. there were companies that ran 2008 and 2009n because the markets were open -- because the markets were closed. stories thatating were ridiculous on the face of them. so no regrets whatsoever. cathie wood speaking to erik schatzker. the screen,way from you can find in-depth analysis and the big newsmakers on bloomberg radio broadcasting live from our studio in hong kong. plenty more to come.

stay with us.

paul: just a few minutes away from the markets open in australia. .1%,res coming off another so let's get to sophie with what stocks to watch.

[indiscernible] cutting its guidance and airways ahead of the christmas holidays. we are keeping an eye on resource stocks. this, as australia upgraded its mining forecast as we have seen iron ore forecasts top $160 a ton. they see the momentum extending into the first half of 2021. they say tread carefully on buying metal. we are keeping and i on reaction to news that the republic of congo has canceled a massive iron ore project and awarded three new permits to a relatively unknown company with chinese backing. south32 in focus after saying the tribunal for a sale of the

coal business there is expected in 10 days time. up -- that is what we are looking out for in sydney. this is bloomberg. ♪

paul: good morning, i'm paul allen in sydney. we are counting down to asia's major market opens. shery: i'm shery ahn in new york. u.s. lawmakers cleared the last significant obstacle to a new relief deal. mitch mcconnell confirmed the agreement being reached, meaning the $900 billion draft can move to a vote. the