paul: counting down to asia's major market opens. shery: welcome to bloomberg markets: asia. president biden speaks to xi jin ping. the call comes amid tension over trade, technology and geopolitics. jay powell a push to deliver

full employment. the fed chair warns the u.s. jobs market remains a long way from full recovery. what would normally be a massive traveling period for the lunar new year. we hear from the association of asia-pacific airlines. paul: a thin holiday session across asia. sophie: thin volumes expected. asx 200 opening flat this morning. gold elevated on the soft inflation we got from the u.s. and jp morgan's head of quantitative derivative strategy -- says they've entered an upswing phase of a new super cycle. copper hits an 8 year high. we are keeping an eye on miners. on the back of its earnings and on news that areis management

has scrapped its takeover bid. shares falling 10% this morning. the biggest slide since june of last year. keeping an eye on oil. seeing gains stalling with crude falling this morning. 22 sign the rally may be overheating -- pointing to signs the rally may be overheating. and let's take a look at some of the closed markets of asia head of the lunar new year. china, south korea, japan, at a half day of trade here in hong kong. ahead of all this we have it fluctuating -- the yuan fluctuating. he sees the renminbi at the top end of the cycle against the dollar. shery: let's turn to our top story. president joe biden and chinese president xi jinping are

preparing to speak for the first time since the new administration took office. we talked to our foreign policy reporter. so many outstanding issues. what are we expecting the conversation to be about? nick: it is almost certainly going to be a pretty tough conversation if you judge by the one that the secretary of state tony blinken had with his chinese counterpart. the u.s. are likely to press china on chin jang. it has labeled what happened there is genocide. on hong kong and also on trade. like you say, so many issues but the bigger one is the signal the administration wants to send. it's coming quite late that joe biden is speaking with the leader of the world's second-largest economy. so, he's sending a signal there, saying listen, the united states wanted to talk to allied nations first and then turn to china. trying to show a sense of unity

with other nations and drawing a contrast with president trump who shunned a lot of u.s. allies. paul: meanwhile president biden -- ordering a comprehensive review of tiktok. what more do we know? nick: well, there was a large push in the trump administration obviously to get the sale of tiktok, to get it sold to, or a big steak of it sold to oracle and walmart. since then, there has been an easing up on the gas on that situation. there has been no pressure by either tiktok orin the -- from the u.s. government to go ahead with it sale. so, what we're hearing now is that deal has essentially been put on hold for now. there is really no sense of urgency about getting that through. in the meantime, they are going to wait for u.s. regulators to look at the particulars of the deal and the potential of any security concerns. sharing american state and

making sure that does not go back to china. shery: we saw the u.s. and china cooperating and being on the same page when it comes to myanmar at the united nations. what can we expect some areas of partnership to be? nick: there are two the administration says it wants to focus on. the first is climate change. we know that john kerry, the u.s. envoy, head of the climate portfolio p he wants to work with china on climate. we also know that there is some tension within the administration. listen, you have got to hold back because this is one part of our strategy, but more broadly we're taking a much tougher line. so, they're holding him back in the gate a little bit. the other is arms-control. a few concerns about china's own stockpile of nuclear weapons. the u.s. had really good -- has never had access to how big those numbers are for china.

there has been some talk of trying to find common ground there, but that is seen as very much a long way off. paul: foreign policy reporter nick quantum -- wanham there. let's get to the first word headlines. >> the u.s. is imposing sanctions on myanmar following the military coup, depriving the army leaders of one billion assets in america. the news come when de facto -- leader aung san suu kyi and other leaders have been arrested. security forces have used water cannon and rubber bullets to dispel demonstrators and there are allegations that live ammunition has been fired. meanwhile, the investigation in an air crash in indonesia. says up -- a problem could be to belay. it is not clear how the air boeing 737 dived into the sea moments after takeoff but it appears the engine cut power.

the 26-year-old plane had suffered similar problems on previous flights. all 62 people on board the jet were killed in the crash. meanwhile, china has succeeded in sending a spacecraft to mars, reinforcing its ambition of rivaling the u.s. it reached orbit on wednesday evening beijing time. it will circuit the planets for several months before sending a rover to the surface. the chinese craft is one of several visitors including nasa's perseverance rover which will make it towards mars later this month. testimony from a nissan insider reveals that the toppling of carlos ghosn had been discussed in early 2018 well before his arrest in tokyo. the senior vp was testifying in the case of a carlos ghosn ally who was also removed. he considered whether they raised questions of criminality.

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 am karina mitchell. this is bloomberg. paul? paul: we are keeping and i on a&p. what is going on there, sophie? >> under pressure, falling 10% to the biggest drop since summer last year. as we learned that aries management is scrapping a takeover bid for the wealth managemer. and you have the company reporting -- for the wealth manager. so, some downside news for amp shares this morning. other stock movers we are keeping an eye on. as we have earnings out for australia's agl energy. it posted a steeper net loss on weaker power price.

asx shares are under pressure after posting a drop -- in o ffering a revenue that got a lift from listings. shares off by more than 1%. newcrest mining moving to the upside nearly 5% after it had a big boost. the gold prices share, first-half profit almost doubled to $553 million. it's new dividend policy will see a higher of 30% of cash flo being doled out. shery: he joins just after noon in hong kong, 3:20 p.m. in sydney. the lunar new year holidays are upon us with travel demand far below prevent chemical levels. the director general on his

outlook for the airline industry. up next, the market outlook for mainstay capital. he's bullish on stocks. will inflation expectations -- force the fed's hand? this is bloomberg. so you're a small business, or a big one. you were thriving, but then... oh. ah. okay. plan, pivot. how do you bounce back? you don't, you bounce forward, with serious and reliable internet. powered by the largest gig speed network in america. but is it secure? sure it's secure. and even if the power goes down, your connection doesn't. so how do i do this? you don't do this. we do this, together. bounce forward, with comcast business.

shery: investors concerned about rising inflation -- after chair jay powell signaled that easing monetary policies are here to stay for now. kathleen, chair powell staying on message. kathleen: certainly. the message is we will stick to the super accommodative monetary policy as long as the labor market shows us that millions of people in the united states are still unemployed. in fact, he said, despite this

surprising speed of the recovery early on, we are still very far from a strong labor market whose benefits are broughtly -- br oadly share. he talked about in the q&a. some people have kept working for some are doing fine but many others aren't. that is why accommodative monetary policy is necessary. in fact, the fed's on pace to keep buying the same amount of bonds and no taper and to look at goals, inflation above 2% and staying there, full, maximum unemployment. any said very importantly hearkening to the fed's concern about racial disparity, disparity between the high income and low income. the policy needs to be accommodative. the whole society, he is calling on the government as well, has to be in on this. >> given that the number of people have lost their jobs and

the likelihood that someone struggled to find work in the post pandemic economy, achieving and sustaining maximum employment will require more than supportive monetary policy. it will require a societywide commitment with contributions from across government and the private sector. kathleen: so, pretty clear, jay powell looking to a stronger economy but he said until the pandemic is under control, we don't even thing about making any changes. paul: kathleen, the latest inflation report does seem to support powell's stance. kathleen: it is a pandemic driven cpi. let me give you some numbers as i show you this chart that is so important to understand what is going on with inflation. consumer prices were on the headline of 0.3% last month. we are showing off services. in terms of the monthly number, the core was flat, unchanged. year over year, no change in the

core consumer price gauge at 1.4%. look what services are doing. often this is what is driving inflation higher. people are saying, services prices are rising because of labor markets -- that is what you worry about. that is not what we are seeing. goods prices -- jay powell when asked about his concerns over inflation, what he is watching, he made it clear he ain't worried yet. >> there could be some upward pressure is on prices. again, though, my expectation would be that that will be neither large nor sustained. in major part we are looking at actual inflation. we want to see actual inflation. kathleen: in other words, it does not matter what forces you are seeing that push inflation higher. he wants to see actual inflation. fed officials are worried if they start rising they could pull up inflation. powell i think is signaling,

look, i got to see it in the real numbers. paul: global economics and policy editor kathleen hays. joining us now we have mainstay capital management coe and chief investment -- ceo and chief investment manager david kudla. do you see any signs of rising inflation? >> not really. in the most recent u.s. inflation numbers that just came in, both core and headline came in a little weaker than expected. so, we've had a lot of economists and market pundits have been talking about runaway inflation. literally 1970's style inflation for the u.s. i don't see that. and i don't see that, you know, we may have a, what i think will be a head fake later this year. mid year when we have the economy in the u.s. starting to open up.

at the same time this fiscal stimulus package is, these chec ks are making it into the hands of people. we see some numbers that might suggest that inflation is ramping up, but i think it will be a short-term phenomenon. i would agree with kathleen's report that jay powell will be looking for, do we see hard numbers that suggest that inflation is trending up and staying up and not just a blip or a transit response in longer-term data that would suggest we are really seeing that move upward and stay upward. i don't inflation as much of a problem as much of a problem is maybe others do. as long as that is the case and the fed does not need to move, we -- are -- in that environment. paul: another area whether fed is not going to move is the balance sheet. powell emphasizing he has no plans to reduce the size of that.

because we all remember what happened last time the fed tried tightening. can they ever reduce the size of the balance sheet without creating a bloodbath on the equities market? david: and that becomes our fear on the horizon for 2021. everything, it really is -- an environment for stocks we have $120 billion a month in liquidity into the market. fiscal stimulus, central banks have been begging for so long for fiscal stimulus to join, monetary stimulus has been there for so long. not just with the fed but with central banks around the world. now we are seeing that stimulus come through. so, this has just been a good environment for stocks in general, especially now for the value sector for cyclicals that have come on strong. his lungs that continues, we're in a very good -- as long as

that continues, we are in a very good environment for stocks, as long as the city pushing stoc -- as long as it is pushing stocks higher. jay powell, as katherine said in her segment, he and the fed hope to not have to move on rates. i think they'll wait until they have to move. they really do not want to. they want to wait as long as possible. any suggestion that they will or if we do see enough data for a couple months in a row or enough that the bond market moves itself, they call a spike in rates. there was this concern that 1% on the 10-year. the u.s. 10-year treasury, that was a psychological level. removed about that. didn't even bother stocks. now we are moving on the 10-year . we're moving towards, you know, even higher yields, moving towards 1.25 or at least towards 1.2%.

stocks are continuing to do ok. it is really going to be that spike and rights that will be the catalyst that could cause real problems for the stock market. shery: how do like earning so far, especially when you're talking about valuations and fundamentals really not being reconciled at the moment? david: well, coming back to fundamentals, what we have seen through the pandemic earnings coming in better than expected. and earnings that are coming in very well here in this earnings season, some of the best earnings we have seen in terms of beating expectations or setting records again. as far as when we are looking at the fundamentals for stocks and what we are seeing in earnings for this reporting season, we are seeing a lot of beats on expectations. and so, we can only say that is a positive as well for stocks right now. shery: david kudla, always great having your thought. mainstay ceo and chief

investment strategist with his thoughts on the market right now. plenty more to come on daybreak asia. this when you switch to xfinity mobile, you're choosing to get connected to the most reliable network nationwide, now with 5g included. discover how to save up to $300 a year with shared data starting at $15 a month, or get the lowest price for one line of unlimited. come into your local xfinity store to make the most of your mobile experience. you can shop the latest phones, bring your own device, or trade in for extra savings. stop in or book an appointment to shop safely with peace of mind at your local xfinity store.

paul: a quick check of the latest business flash headlines. uber reporting declining revenue in the fourth quarter showing the demand for food delivery cannot offset ride numbers. sales dropped 16% to $3.1 billion, short of the estimate in a survey. although it has -- its adjusted loss could not be forecast. newcrest mining reported a profit of $535 million. revenue came in at 2.1 aussie dollar -- 21% on the year. gold production is expected to be at the upper end along with expenditure. unicredit posted a larger than

expected loss on the fourth quarter after writing down goodwill and accelerating cleanup of its balance sheet under the new ceo. the $1.4 billion shortfall was twice what analysts were expecting. as the ceo tries to reduce the debt. shery: general motors posted a stronger -- fueld by demand for suv's and trucks. the auto making giant has not been able to accept -- escape the semiconductor short is reverberating throughout the field. the ceo gave bloomberg her outlook for the year ahead. >> we're going to have a very positive year in 2021. not only from a financial perspective but also the continued acceleration of our e.v. and our a.v. business. we are excited that very shortly we will be launching a great vehicle. that's days away. you know, later this year we

will be serving the market with the gmc hummer e.v., and then the cadillac lyric comes after that as well as tremendous projects -- progress from an autonomous perspective. we are excited about the growth opportunities in front of us and so the year of execution. the issues with chips is a short-term issue. >> is general motors and the same boat as everyone else. are there things that you can do to have an advantage over other automakers? >> in general, this is an interesting issue. we are working every day with across social teams, looking for opportunities, how do we minimize the impact? we'll continue to do that. we did provide the guidance with a wide range, and we will work it every day and provide updates as we go forward. david: you have a lot of e.v. models including the bolt new model. you are investing $27 billion, paul of them -- part of a

multiyear plan. as a practical matter, what are the difficulties of that plan, supply chains, things like battery cells, some lithium issues? do you anticipate possible problems with supply chains into your battery operation? >> well, i think we are one of only two car makers that are doing cell manufacturer in this country. we also i during a trend is amount of development on our own gm r&d as well as partner with startups and our joint venture with -- that is development as well as production. so, we're working hard to make sure we have all the cells we need. and we have worked through -- to make sure we do. as we've talked about, we are accelerating our e.v.'s with 30 by 2025 and really covering the whole market. we continue to work it, but we think we have a very strong plan. paul: that is the gmc your mary

barra speaking to david westin. don't miss our k-swiss of interview with mgm resorts ceo -- don't miss our interview with mgm resorts ceo after revenue dropped 58% in china. later on thursday in the u.s. in early friday on asia. more big interviews coming up in the next few hours. don't miss our conversation with mattel's ceo. and newcrest's ceo as well shery: and take a look at some commodities year today because we have seen such a rally when it comes to copper and nickel, platinum. copper finishing at an eight year year. we have seen a rally of 6%. and nickel also gained about 40% over the past 12 months. copper and nickel are unlikely to keep rising given the uneven market -- tight conditions, and

you see wti nearing $60 a barrel. jack ma has been spotted working on his golf swing. a new sighting may provide some insight into china's most talked about tycoon. that is next. this is bloomberg ♪

>> this is daybreak asia. secretary -- fed chair jay powell is calling on lawmakers and private industry to support workers. he told the economic club of new york that employment -- are 10 million below levels in 2020 and achieving full staffing will require more than simple monetary policy support. as he pushes his -- biden's near $2 trillion leaf package.

president biden is x preparing to speak to china's xi jinping. sources say the call is planned for wednesday evening. in a couple hours in washington. the conversation between the leaders of the world's two biggest economies will happen with tensions still high over trade, technology, and beijing's tightening grip on hong kong. the biden administration is asking a federal judge to halt litigation over the former governments ban on the chinese video app tictac. the administration plans to review president trump's action. tiktok was among several companies that trump considered a national security risk. its potential sale to oracle and walmart has been put on hold. an investigation into an air question internation say a throttle problem may be to blame. officials say it is not clear how the boeing 737 dived into the sea moments after takeoff, but it appears the left engine

throttle cut power. investigators say the 26-year-old plane suffered similar problems on previous lights. -- flights. all 62 people were killed in the crash. 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 am karina mitchell. this is bloomberg. paul? paul: up and running for about 30 minutes in australia. markets across the asia-pacific close today ahead of the lunar new year. for what's going on let's get to sophie in hong kong. sophie: that's put australia in the spotlight. stocks mostly lower with amp the biggest reg are on the index. -- the biggest loser on the index. oil prices are under pressure. hovering above $58 a barrel. we are seeing -- rising to fresh

all-time highs in sydney. the stock more than doubled that share price your today. rising more than 30% earlier on results for treatment for -- other stock movers of no. one highlight -- financial under pressure after a drop in first-half performance. we are seeing a little change now, after its earning amid a 14% inthe first half. green corp noting near optimal conditions across eastern australia. on a positive outlook after first-half running speed flipping the board. global stocks looking to stall this friday with futures headed lower on trading ahead for asia with most markets off-line. the u.s. seeing slight gains

after a mixed session on wall street while the dollar is holding onto a four day drop. dovish remarks from powell. future markets are seeing the fed raising rates in late 2023 whether rbs -- in late 2023. shery: let's turn to the latest on the whereabouts of the billionaire cofounder of alibaba, jack ma. he has been spotted playing golf after weeks out of public view. su keenan us with the latest. we are now hearing that ma has been at a secluded resort on the chinese island. su: that's a far -- [inaudible] that's a far cry from the concerns he was in jail or house arrest. bloomberg has learned the embattled billionaire jack ma has been teeing off, playing

golf and sun valley golf resort he was last seen in a video chat on january 20. that seemed to reduce fears of what was being thought of as a worst-case scenario, that he fled to singapore, has his assets seized or even worse, that he had somehow been imprisoned in a high security facility. it went a long way to help relieve investors we saw the stock edge up 1.5% in new york trading. again, there had been continued speculation about ma's standing with china's commonest party, which has continued to clamp down his spiraling business empire. this golf sighting is the first known physical sighting of the famous cofounder of alabama and ant. -- of alibaba and ant. it did help the stock tick up, but neither of ma's compa paul: giving these reports of a.

restructuring to ant, what's likely ahead for jack ma and the companies he created? su: this reported restructuring could be the first up on what would likely be a long road back to possibly an initial public offering that goes forward for ant. ant reportedly has reached a restructuring agreement with authorities according to sources. they say a public announcement could come as early as this week. the ant fintech ipo was halted by regulators in november days before it was to trade in shanghai and hong kong. ma's infamous critique of china's financial regulators resulted in significant pushback within days of the speech that he made, authorities scuttled ant's listing and called for an overhaul of the company and launched an antitrust probe into back to you. paul: su keenan there in new york.

primavera capital founder -- says chinese regulators have struck the right balance by raining in big tech without ruining intervention. he spoke to bloomberg about why he is bullish on the sector. and where he sees other opportunities in china. >> i think the economy is in good shape. we're now, the recovery is not just confined to manufacturing exports, but demand, particular consumer spending is going up strongly. >> you have just launched a spac with primavera capital. you have the ipo. you are focusing on the chinese consumer, right? what particular areas do you want to focus on? >> at this point in time, the chinese consumers -- for the global economy. so, i think there are many, many companies in the consumer industry that would add more

chinese growth to drive their business performance. so, i think there's a very good opportunity out there that we can marry consumer brand with the domestic chinese consumer spending power. stephen: it is harder talk about consumer and china without talking about tech, because alibaba or tencent, they have these all-encompassing platforms that merge tech with thanking, with consumption, retail sales and the like -- that merge tech with banking with consumption. are there cautionary signs as far as the record -- the regulatory environment? >> the strong rebound from the pandemic -- with the recovery. but the fact chinese economy has been probably the furthest along in terms of -- has really given

china tremendous, the economy tremendous resilience. to handle that kind of shock to the economy.s stephen: has it hindered competition? >> that is for the lawyers for the conclusion but the fact that china and u.s. -- have the two largest digital ecosystems. and the two largest digital economies. and they are successful technology platform companies that have become so big and so omnipresent. of course, there is legitimate question as regards the possibility -- those platforms might reduce their market share. as the government wants to deal with the monopoly.

but they don't want to like decimate or damage the, you k now, vibrant domestic ecosystem. and the tech companies, alibaba and tencent and others, are also, -- they have responsibility to behave themselves. their legitimate concern -- by the media or by the -- that they have to take those considerations very seriously. stephen: how does this cloud or how does it change how you might make an investment in tech now, as opposed to pre-regulation changes? >> our investment approach hasn't change. we continue to think that technology can be a force for good. it will transform the economy, transform industry. and empower consumers.

so, we're continuing to -- to companies, or when they become most -- growth equity. so we are very bullish on tech in china but also globally. stephen: ant grew very fast and they went into lending and many other areas and now they are put into a holding company. do you see the great gold rush is tapered off or over to a certain degree? >> chinese government have done a very good job in anticipating and managing emerging risk. at the same time, they keep changing technology environment

but not go so far as to, you know, strangle innovation. shery: primavera capital founder and chairman fred hu with stephen engle. coming up, the lunar new year holidays are upon us with travel demand remaining well below pre-pandemic levels. the director general gives us hi s outlook for the airline industry next. this is bloomberg. ♪

♪ >> currently i have probably 50% of the pre-covid level. this time of the year last year was actually very bad, at the lowest point probably. then into spring and summer it started to recover. and we hopefully have seen the same pattern this year. >> i'm not holding my breath for a v-shaped recovery. i think we are not in the game of -- positive numbers, not for this year. >> the chinese new year, 10% -- just just this holiday period. so, it is significant. but it is not absolutely major.

for chinese -- they can survive. >> in between travel is very much restricted. we are focusing on basically providing the best possible experience for our guests. >> we are seeing strong interest in outdoor experiences. the challenges on the merchant side -- so, a lot of the service providers are very much mom-- mom and pop side of businesses and offering it a very off-line fashion. shery: some of our guests sharing their outlook for lunar new year treva. -- travel. representating 14 carriers of the reason, we are joined by the director general of the association of asia-pacific airlines subhas menon. great to have you with us. thank you very much for your time today. given all the restrictions that

are still in place and you are telling us yourself you are actually right now stuck in sydney which is not a bad place to be stuck in, but you are. what are you seeing in terms of demand now with the lunar new year? >> demand is, of course, very poor because of all the restrictions, which i think will continue for some time to come, you know, because governments have realized that in the asia region they have been rather successful in controlling the virus. whereas those places that have pursued a less risk-averse policy are paying the price in terms of being overcome by the spread of the virus. so, i think these restrictions will continue for a long time. it is not only the lunar new year that has been effective but also christmas and new year, but

the resurgence in the virus and spread of the mutant forms started taking place from early december. shery: you have 14 members in your association. who are the biggest hit, considering perhaps we do have domestic demand in places like china, but other markets do not necessarily have those domestic moves? >> i think everyone is badly hit, because this is a crisis which is affecting supply. our airlines are not allowed to fly freely. there are a lot of border restrictions, which are also affecting the demand side of the portion. so, everyone is affected. those that have a higher reliance on cargo are bet ter. because demand for cargo has actually shot up. those with domestic markets, which are under control as far

as the virus is concerned, are faring a bit better than airlines who are completely dependent on international travel. paul: we had the news today that the first airline to have a fully vaccinated crew operating. is it your expectation that that will become the industry standard? >> well, in singapore, the singapore government has decided that aviation workers are front-line workers. so, they also have some priority in terms of the vaccination programs. but we are yet to see other countries follow suit. but, of course, you know, the prioritization has always been based on the most vulnerable. so, we have to see how governments react to this. paul: going ahead, also, we have qantas stating that it will have a no jab, no fly policy.

can you see there could be the potential for some safety or reputational risks for any airlines that do not do this? >> as far as i understand it, vaccination works in a way that it immunizes individuals from falling sick to the virus. so far, the transmissibility factor has not been proven. whether a traveler who has been vaccinated has been less infection. how vaccination should work as the majority of the population that is receiving -- should be immunized so they do not have to fear more cases. shery: we are seeing some in different -- different initiatives when it comes to vaccinations and testing, digital passports. iata release the travel pass. how do you feel about those

apps and tracking that information for passengers? >> well, i think the whole industry is working towards this end, because i think when travel returns, travel consumers will expect to have contactless and seamless travel. there are many requirements now. each place has got its own requirement like testing and vaccination and things like that. so, how do you make sense of all of this for travelers? how do you give them a way in which they can going get themselves tested, at authenticated test centers? how are these -- formats of vaccination certificates standardized and transmitted securely to travelers? and most importantly how can

then you use this certification to gain access to borders? also, i think the smart solution is probably the only way to do it. it requires a lot of multilateral agreement on standardization. shery: there has been a lot of expectations in the hopes that perhaps we could see travel bubbles from new zealand to australia or hong kong to singapore. and of course these schemes have to be shut off from time to time because we have seen surge s in infections. with the new variants, do you hold out any expectation the bubbles could be established? and could they provide meaningful support until everybody is vaccinated? >> yes, i think travel bubbles will return, but what i see is for the vaccination programs to be faster, so that the majority of the worlds populations are

vaccinated. at the moment, the vaccination programs is such that the developed world will all be done in less, by the end of the year. many emerging markets, developing countries, are on a very slow -- to achieve the same result. so we need to speed this up, because recovery, economic recovery and travel recovery cannot just happen in the developed world. for travel to really pick up, you need more faces -- more places to be immunized. paul: association of asia-pacific airlines director general subhas menon, thanks for joining us. be sure to tune into bloomberg radio to hear more from today's newsmakers. and get in-depth analysis from the daybreak team. forecasting live from her studio in hong kong, you can listen via the app or bloomberg radio.com. stay with us. ♪

shery: here is a quick check of the latest business flash headlines. the resorts chairman has apologized after reports found the company is unfit to hold a gaming license in new south wales. crown appreciates the need for root and branch change after misconduct and compliance issues. the report by retired judge which looked into alleged criminal activity called for the

department of the ceo and key directors and a cap on share ownership. mastercard is adding its back into cryptocurrencies and joining us swing of big firms becoming interested. it will offer reports on its net worth with this year with the news coming after tesla said it has purchased $1.5 billion in bitcoin and will accept it as a form of payment. , blackrock square and paypal have also recently announced support for cryptocurrencies. to your to jump in new york trading after saying it plans -- toyota jumping in new york trading after saying it plans to raise his game and the electric vehicle market. it plans to market three new cars. and it was a quarter of its new vehicle sales to be electrified 2025 and 70% by the end of the decade. dating app bumble is capitalizing and invested interest by boosting the range of its ipo.

looking to sell shares at $43 apiece, higher than a price of between $37 and $39. when it initially launched plans for an ipo it was looking to raise about $8 billion. that seems set to rise. blackstone took a majority stake in 2019. rihanna and lvmh are suspending the ready-to-wear operations after the singer's fenty brand less than two years after its launch. they blame the fallout from the coronavirus and say they hope it will return when conditions improve. fenty arrived in may 2019 to great fanfare. paul: still to come, toy sales had record sales in 2020 p can the momentum be sustained?

and the fed will blink sooner or later on inflation. more on that at the top of the hour. marcus would've been open in tokyo and seoul. it is a holiday. we are open in sydney. details in a moment. this is bloomberg. ♪

shery: welcome to "daybreak: asia from bloomberg's headquarters i am shery ahn. paul: i am paul allen in city. our top stories, president biden prepares to speak to xi jinping since the first time -- for the first time since taking office. he comes over trade and technology and geopolitics. -- a societywide place to live a societywide push deliver full appointment. it warns the u.s. job market

remains a long way from full recovery. the pandemic hit holiday season as been good for mattel: it says the strength of the toy market with the ceo this hour. sophie kamaruddin as the details of the market close. sophie: a lot of major asian markets close today. the session this friday with australia in the spotlight, kiwi stocks under pressure, -- trading in hong kong and china breaking in one week with the offshore yuan trading around 643. we have newcrest mining jumping. less than we saw in gold prices for its earnings. a b-shares tumbling as the -- scraps its takeover bid. -- adding higher .2 of 1%. looking at commodities, bouillon state elevated after we had the jump in software inflation report in the u.s..

jp morgan expecting gold will stay elevated during the next commodities have likely entered an upswing phase in a new super cycle, but we are seeing oil start the deal with new crude off .6 of 1% after the best winning streak in two years. -- under pressure after we saw -- rise to an eight year high. the dollar holding onto a ford did decline steady now after remarks from jay powell. ups does remain -- 2145 basis points whereas hsbc major seeing tidbits on the 10 year amid uncertainty among 10 year inflation. shery: let's bring in the cleef -- chief global market strategist. always great having you with us. we continue to hear inflation

expectations rising, concern over what that means for markets. when it comes to actual data we have not seen that developed. what are you seeing in terms of markets, especially what we have a very quiet week because of the lunar new year holiday. >> there was an outsized move to [indiscernible] income. it got me by surprised. it could be incredibly volatile. that says much about what is going on in the medium. concerned about how inflation stocks are getting priced. the start getting based on core data seems to be getting envelope around building expectations around help markets are evolving. market signals like the higher s&p 500, ira stocks, this is treating to the inflation stock price.

it is not actually seen in the core inflation data. we are not realizing and embracing inflation we have not seen in 25 years. that is quite a leap. shery: let's take a listen to what chair powell had to say. >> there could be upward pressure on prices. again, my expectation would be that that will be neither large nor sustained. in major part we are looking at actual inflation. shery: from those comments he sounds like he is going to look through any transitory push upward when it comes to inflation, so are you concerned that it is perhaps over cheating from the stimulus package and vaccine rollout? what should markets be aware of right now? >> there is going to be some inflation. it is whether the inflation is lasting beyond demand that comes out of the gates between the

vaccine at a reopening narrowness. that is the big question on whether that will raise concerns whether the fed will have to move on monetary policy. whether they start to draw back on qe, which is a likely thing to have to anticipate because economies are going to recover. there will not be a need to monetize as much. this change in absolute monetary policy, markets let -- not looking for rate hikes as well. [indiscernible] that is the big read that we will have to see how actual data on the ground affairs out not how markets are reprising inflation swaps. that is the way i'm reading into the markets right now. shery: let's talk about the u.s. dollar. it has lots of them occasions -- lots of implications when it comes to emerging markets.

emerging positions still being built. what does this mean for the yield environment and where the u.s. dollar heads and what we can expect in asia? >> historicity higher u.s. yields mean a stronger dollar. i do not think a lot of people in the street have actually gone to a rate hike cycle and that could be a problem given the [indiscernible] is predicated on the global growth narrative. i can see the dollar weakness, [indiscernible] it seems the position is quite extreme. reactions on the street are longer for a more pronounced u.s. dollar. i do not see it happening if u.s. yields go up above 1.5 percent or even 2% in the 10 year. if we do actually move from cyclical growth to a monetary

price increase in rates going forward. paul: we are also seeing oil prices increasing, 6147 a barrel. do you see that posing a risk the economic recovery in terms of emerging markets? >> that is to the point. there are two sides for emerging markets. [indiscernible] so it is a counterbalance effect. it came off a little bit from highs overnight. we are probably going to see saudi arabia walk back some of their pledges to cut production, and i think we will see signaling that produces by putting more barrels back in the market as we approach the marks level. i do not think there is anything to stop in the way of markets finding $65 per barrel lunch. the fundamentals are starting quite well. we have got the vaccine ended impressive demand coming out of china. and once that [indiscernible] on

the reopening there will be a lot of people driving a lot more, and that displays really well. the one thing about oil is travel. once the travel lanes open this is where the real liftoff in oil prices is going to incur. paul: stephen innes in bangkok, things were joining us. let's get to karina mitchell for first will headlines. karina: donald trump's impeachment trial as syncretic video showing a violent mob of the former president's rampaging through the u.s. capitol and stocking a speaker nancy pelosi and vice president mike pence. impeachment managers are portraying the sieges a combination of the former president's month long campaign to still linger -- anger over the election. six republicans have agreed to republican -- the travel is unconstitutional, the prosecution seems far from winning 17 shield p votes -- 17

shield p let's dig be to the president. -- following the military coup depriving leaders of assets in the u.s.. the news comes with the de facto leader and others doing detention. this image street protests across the country. security forces have he water cannons, to address, and rubber bullets to dispel demonstrators and there were allegations of life ammunition being fired. the investigation into last month will be us air crash says that the mental problem made to be to blame. officials say it is still not clear why the china air blowing 7:37 into the sieges moments have to takeoff, but it does appear the last engine throttle moved by itself and cut power. investigators say the 26-year-old plane had suffered similar problems on previous flights. all 62 people on board the jet were killed in the crash. and the world's wealthiest most

expensive weapons system has suffered a new setback. exhibition flights of the f-35 are being cut back because of engine problems and shortage of spare powered units. that is caused premature cracks on turbines. air combat command is got the plane -- obvious appearances by at least one/three. china as succeeded in sending an spacecraft to mars reinforcing its ambition are rivaling the u.s. as a space power. the craft reach orbit on wednesday. it will circle the craft before sending it to service. -- which is likely to arrive later this month. 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. shery: we speak to mattel about earnings and the strength of the toy industry amid the pandemic. i'm guest joins us later. president joe biden and xi jinping are to hold their first call since the new administration moved in in washington. this is bloomberg. ♪ (announcer) back pain hurts, and it's frustrating. you can spend thousands on drugs, doctors, devices, and mattresses, and still not get relief. now there's aerotrainer by golo, the ergonomically correct exercise breakthrough that cradles your body so you can stretch and strengthen your core, relieve back pain, and tone your entire body. since i've been using the aerotrainer, my back pain is gone. when you're stretching your lower back on there, there is no better feeling. (announcer) do pelvic tilts for perfect abs and to strengthen your back. do planks for maximum core and total body conditioning.

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shery: we moved to a big scoop, president joe biden and chinese president xi jinping are said to be holding a call for the first time since the two took office in washington. the call over foreign policy. a lot to discuss. what are we expecting to be on the agenda? >> lots of things. u.s. concerns over chinese human rights actions and by the administration great -- agreed

with the trump administration that what is happening in -- is genocide. chinese theft of intellectual property, the desire to barth some experts -- exports and sensitive items to china. all sorts of issues but a more broadly to give was thinking we are seeing is that the biden administration is reversing a lot of things that the trump administration did but one thing they are not reversing is this much tougher tone toward china where they see beijing as a strategic competitor and not as a nation they would cooperate with on a global issues. paul: it is meaningful about the time of this call. it has come fairly late after president biden was inaugurated. are there any strategic reasons for that? shery: what you are seeing is it

explicit signal by this administration that president biden wants to tell allies and the rest of the world that he is doing things differently from donald trump. trump's burned a lot of u.s. allies. there was confusion about where he stood with countries like france and germany, for example. what joe biden did was went down the list of all of the countries, to u.s. allies around the world and europe, obviously also in asia. he wanted to do those calls first and then speak to the chinese to send a signal of whose side he is on. barack obama spoke to then president on january 30 after he won election in 2008, and donald trump had spoken to xi jinping after he won the election and after he took office, so joe biden in doing this very intentionally. shery: we have seen president

biden reviewing and a lot of times conversing lots of policies implemented by his predecessor. what are we expecting on tictoc? >> that is a great question. essentially what happened is less summer donald trump basically forced tiktok to selloff a huge portion of itself but that deal never went through and in the waning days of the trump administration trump himself took the foot off the gas because according to some folks he did not see this as a winning political issue. when a bytedance and regulators and oracle at walmart and all of the others involved in that deal went to the trump administration knocking to say ok, where to be going out, they got essentially silence. what we are hearing from the biden administration they are going to look at the terms of the deal and look at broader

issues considering bytedance's operations in the united states but there is no pressure to make sure that deal goes through and they are indicating that they essentially have other priorities in the relationship putting this on the back burner. paul: our foreign policy reporter right there. still to come, following months of speculation about jack ma's whereabouts the founder has been spotted. that is up next. this is bloomberg. ♪ ♪ - [announcer] imagine having fuller, thicker,

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paul: kevin fetter fred hughes says chinese regulars have struck the right balance by renting intech without running innovation. he spoke exclusively to bloomberg about why he is still bullish on the sector and where he sees other opportunities in

china. >> i think the economy is in good shape. right now the recovery is not just confined to manufacturing exports but domestic demand, particularly consumer spending. it is picking up slowly. >> you just launched a spac and you had the ipo. you are looking at focusing on the chinese consumer, right? why do particular areas do you want to focus on. >> at this point in time [indiscernible] for the global economy. there are many companies in the consumer industry where you will have more on china's growth. there is an opportunity out there. it can marry consumer brand with

domestic chinese consumer spending power. >> it is hard to talk about consumer in china without talking about tech because alibaba or tencent at of these all-encompassing platforms that merge tech with banking, consumption, retail sales, and the like. are there cautionary signs as far as the regulatory environment? >> china has a strong rebound from the depths of the pandemic, but the fact the chinese economy as been the furthest in terms of this transition has given the chinese economy tremendous resilience to handle that kind of negative shock to the economy. >> has it entered competition? >> that can be an evidence-based

conclusion but the fact that china and the u.s. together have the two largest digital systems and two largest economies, and there our technology platform companies that have either become so big and so omnipresent. that is the question as regards the possibility of growth, might, abuse, market power. the government, they want to deal with the behavior had on. they do not want to damage the vibrant domestic ecosystem, and

tech companies, alibaba, tencent, and others [indiscernible] they have a responsibility to behave themselves. given the concern whether by the media or the [indiscernible] they have to [indiscernible]. >> how does this change how you might make an investment intech now as opposed to pre-regulation changes? >> [indiscernible] we continue to think technology can be a force for good. transform economy, transform industry, and empower consumers, so we continue to [indiscernible] many companies when they start up, so we are

very bullish on tech in china. >> ant grew very fast. they went to lending, many other areas and now they will be put into a holding company. do you see the great gold rush has tapered off or over to a certain degree. >> [indiscernible] the chinese government has done a very good job in anticipating and managing risks. typical deregulation. at the same time, the change in the technology marketing environment, but not go so far as to strangle innovation. shery: the capital founder and chairman with stephen engle.

jack ma as a return to public view amid speculation about his whereabouts. he has been spotted at a secluded golf course after weeks out of public view. it is the first sign of the billionaire since his appearance in a video chat with teachers on january 20. our finance managing editor joins us now. we are obsessively following his whereabouts given the ongoing crackdown on his business empire. tell us about the importance of this latest siding. >> good morning. you mentioned the january appearance. the measure of concern surrounding his whereabouts. [indiscernible] but that was one appearance in many months amid a regulatory crackdown on on -- regulatory crackdown on ant.

it is not clear where jack ma was. [indiscernible] golf resort, a secreted resort in hainan. this adds to recent evidence that jack ma is not in personal jeopardy right now. it takes out the table jail time or government seizure of its assets. i think that is the significance of this story. paul: adding shareholder value never looked so leisurely. are there other signs that the crackdown the government might be taking. >> [indiscernible] of chinese regulars. the most significant, ant and regulars have reached agreement on a restructuring plan.

it will transform into a holding company [indiscernible] so i think it is expected to be a lengthy overall -- over hall. there is going to be more news to come. paul: our asia finance managing editor there. let's get a check of business flash headlines. credit was west rim is after reports found the company is unfit to hold the gaming license in new south wales. the crowd appreciates the need for change after finding of serious misconduct and compliance issues. the company reported [indiscernible] almost double your on your. revenue coming in it to .2 one

billion australian, rise of 21% on the year. it is targeting a total dividend as 60% for cash flow. we have plenty more to come on "daybreak: asia." this is bloomberg. ♪

>> this is daybreak asia. the first word headlines, former president donald trump's impeachment trial has seen graphic video of a violent mob rampaging through the u.s. capitol, stocking nancy pelosi and mike pence. the siege is being portrayed as the culmination of his campaign to stoke anger over the election. six republicans agreed the trail is constitutional but the prosecution seems far away from winning the 17 gop votes needed to convict trump. jay powell is warning the u.s.

labeler market is a long way from recovery and is calling on lawmakers and private industry to support workers. he said employment levels are almost 10 million below levels in february 2020 and achieving full staffing will require more than simple monetary policy support. this echo's the urgency voiced by president biden as he pushes his to trillion dollar release package. resident biden -- president biden will be speaking with xi jinping for the first time since the new administration took office. the call, happening wednesday evening in washington. the conversation between the two leaders, occurring while tensions remain high over trade, technology and beijing's tightening grip on hong kong. court testimony from a nissan insider reveals the toppling of then-chairman carlos ghosn was discussed in 2018, before his dramatic arrest in tokyo.

the senior vp was testifying in the case of an ally who was also removed. he told the court he considered whether the then chairman's actions raised questions of criminality. he is seen as a central figure in the decision to get rid of ghosn. global news 24 hours per day, on-air and on quick take by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm karina mitchell. this is bloomberg. shery: many markets across asia closed on the new year holiday but new zealand and australia, still online. let's turn to sophie for the market action. sophie: trading futures pointing to the downside and we are seeing earnings drive price action in australia. mining gaining and dividend announcements whereas amp is sinking this morning as ares management backed out of a takeover offer. the asx 200 losing ground this

morning. it is quiet and currency markets, the dollar holding onto a four-day drop while the offshore yuan is hovering. gold looking little changed after jumping overnight. jp morgan seeing good support for bully on. futures markets are pricing in fed tightening in late 2023. the commodities price, oil prices styling as the rally may be overdone but citigroup says higher prices for crude are ahead, pricing and $70 per barrel for brent. >> the pen dramatic -- pandemic stricken holiday was great for mattel. people snapped up dolls and cars in holiday toy by. for perspective, we turn to the mattel ceo.

thanks for joining us today. what drove those strong sales we saw in the past quarter and the past year? can you repeat it in 2021? >> this was an exceptional quarter for mattel for our -- with our best performance in years. for the second quarter in a row, we achieved double-digit sales growth, outpaced the industry in shares on a global basis. results exceeded expectations with the highest fourth-quarter growth in 15 years and an increase in profitability with an operating income that was to adapt times higher than last year. this is not just about the quarter or the year. it is about a multiyear strategy that is tracking very well, which puts us on a strong position to continue to increase profitability and accelerate growth in 2021 and beyond. tom: i want to talk about the

longer-term strategy in a moment. in the near term you are forecasting rising sales growth and also falling profit margins. can you tell us about the costs you may be facing? ynon: we have been encouraged with our growing profitability. we achieved our 10th consecutive quarter of improving our gross margin year on year. if you look at the three year trajectory of improving our profitability, we grew our adjusted income by almost $600 million and the gross margin in total raised by over -- by many basis points. we are encouraged by the progress we are making. this year we faced some inflation but this is not taking away the momentum in the progress we expect to continue to drive both the bottom line and importantly, the top line as well. shery: you have done well when

it comes to the turnaround in reducing leverage. what do you plan to do next? what is next for mattel? do you offer dividends similar to hasbro, or acquisitions? ynon: free cash flow has been a priority for us and that is -- has improved read we improved our cash flow by almost $500 million and going forward, we will be focused on converting and increasing a percentage into free cash flow. as we stated, we intend to utilize the excess cash in the short-term to reduce our debt and continue to deliver and make our way towards becoming an investment rated company again. shery: when you talk about long-term strategy, you have started the shutdown of manufacturing sites in china and indonesia. this was pre-pandemic. how did that go?

how has the supply chain challenges we faced during the pandemic had an impact or not, given all the manufacturing overhauls? ynon: we have been on a pretty comprehensive campaign to reshape our manufacturing footprint. this is powered up our -- part of our approach. we have seen our supply chain operation become a competitive advantage for mattel. it performed well during the pandemic. it performed well in the fourth quarter in being able to fulfill more of the extraordinary growth in consumer demand. so very positive, very confident about the supply chain and that is a competitive advantage. tom: part of your long-term strategy is the number of films in production. i wonder if you could update us on the progress. ynon: we own one of the most --

one of the strongest catalogs in the world. we announced 11 motion picture project and they are all in motion. the latest in progress, the latest announcement we made was around an uno film and that will happen alongside a game show we announced. these projects are progressing. we are in casting mode, budgeting, preparing for production. it will take some time, given the scale and the ambition of this project, but it is going to be worth the wait. these are exciting projects, and we are making a lot of progress in that direction. i also want to point out that we also have an exciting driving -- thriving business in mattel television, which currently has 17 shows in production and when he five projects in development. -- 25 projects in development. exciting opportunities to expand our iconic brands outside the

toilet -- the toy aisles and could mean a meaningful opportunity. tom: you have acquired entertainment one as part of an ip strategy. what are the next steps to increase ip? ynon: we focus on commercializing our own brands. our catalog, our intellectual properties, they are iconic. they have a built-in fan base that goes back generations and we see tremendous opportunities for brands both as a toy, in the toy isle as well as in other categories where we see huge opportunities because they are driven by big brands, trusted brands that people know. in today's world, in a world of unlimited shelf space or unlimited screen opportunities driving distribution platforms,

it is about rising above the noise. for that, big brands, big, known, trusted brands. shery: you are optimistic about those action figures. those results were tempered given that nobody is going to movie theaters. are you expecting that segment to do better as we start to reopen? what difference does it make if we are now streaming movies instead of actually experiencing them at cinemas? ynon: we expect action figures to come back as movies continue, will be back in play. and as it relates to the changing distribution model, while you would not have the same traditional marketing cadence with a concentration -- concentrated campaign around the release of a movie, you will have more viewing in a longer window at home.

in that regard, this could be an opportunity when it comes to our target demographics. where people can watch movies at their home, more than one time, for a longer time, and the one thing we should also remember is that the streaming platforms are very sophisticated. they know how to reach consumers. they know where to find them. they are effective. when all is said and done, fundamentally we believe that good content will find its way to consumers and consumers find their way to good content. shery: finally, barbie had a great year. what is next for barbie? what is next for barbie and ken? that relationship has been going on for 60 years. ynon: barbie continues to go from strength to strength. it was the number one overall toy property globally, both for the fourth quarter and the full year. retail sales were up more than 30%.

it has been a multiyear journey for barbie. it is about diversity, inclusivity, ethnically diverse offerings, body shapes, and all about purpose of play. the interesting story around the barbie success, and this is without taking anything away from the incredible success of barbie, is the mattel playbook. because many, much of the methodology of the capabilities, the approach, the authenticity you see around barbie is what we have across our entire product offering. it is about design led innovation, cultural relevance and executional excellence. our category structure in the centralized sign a development organization is filled with extraordinary talent that are working as a team across the portfolio, leveraging skill sets and creativity across the entire

portfolio, which is why we are confident about our growth project three -- trajectory. shery: barbie was my favorite toy. thank you so much for that. the ceo of mattel. next, our exclusive interview with a 30-year-old crypto entrepreneur who famously spent nearly $5 million on a meal with warren buffett. he sees a paradigm shift in investing. this is bloomberg. ♪

shery: a quick look at the commodity space, huge rallies in different assets. a little bit of pressure right now but this after the bloomberg commodity index rallied about 7% this year. lots of optimism over the stimulus package, the vaccine. wti under pressure and curbing the winning streak after u.s. crude dropped to the lowest level since march of last year. copper was higher, and platinum under a little pressure after rallying to a six-year high. just watch out for that commodity space, which has really been a super cycle. paul: let's turn to crypto's. a 30-year-old digital opportunity -- entrepreneur expects a paradigm shift in

investing. he has no plans to sell his stake in gamestop. >> i believe the meme is important in the cryptocurrency. if you want to offer cryptocurrency, it will be welcomed by the millennial and generation z, the new generation , in these kinds of investments situations. i believe meme is the answer. the reason dogecoin is loved is because dogecoin is one of the most famous meme coins in the industry. >> that shiba inu. >> exactly. we have seen a lot of cryptocurrencies start to have the meme on their crypto. >> we had the gamestop drama a week or two ago. you said at the height of

gamestop share price, that you would buy $10 million worth? did you do it? >> we already bought $12 million. $1 million in amc. and the gamestop price dropped like -- i just checked, it is like 80% or something so we only have $2 million left. >> and you will hold? >> yes. i think i am going to hold. if i lose money, i still believe this is a paradigm shift between wall street, the kind of hedge funds, deciding what would be the most valued stock in the market and the shift to this kind of community driven or internet driven, internet community driven investment in

the future. >> this is the meme culture point you made, people might make investing decisions based on community or feeling rather than fundamentals. >> exactly. i believe this kind of culture, these kinds of sentiments and community, it is also a kind of fundamental. >> speaking of spending money, you spent quite a bit on the famous lunch with warren buffett. at the end of the lunch you gave him a bitcoin. that is probably his most successful investment of 2020. >> exactly. already, it is 12 times, 12 times more than it was worth already. and i gave warren buffett 2, 1 is by tesla and i think around january, 2021, i will have

dinner. i wish he can follow me so he can already make 12 times more than i just gave him. >> i wanted to ask about another project you have recently taken on in the decentralization space. you are talking about doing a clubhouse-like app. i'm curious how a project like that matches up with some of the sensitivity we have seen in china around each and censorship . >> i definitely believe clubhouse is very popular in the united states right now and i believe clubhouse is a very revolutionary product. clubhouse is the first time we have had this kind of connection so it is friends of friends. they are strangers but they are referred by your friends. so your social network connections, of course every

country has regulations so we definitely will have these kinds of moderation systems to help identify and moderate the content based on different countries. so for example, the app will run in several different countries, we would have our server also split for the major countries. to guarantee the customers privacy and at the same time, also help moderate the content. shery: justin sun speaking to our executive editor. tune into bloomberg radio to hear more from big newsmakers and get in-depth analysis from the daybreak team brought -- broadcasting live.

plenty more ahead. stay with us. ♪

>> currently at probably 50% of the pre-covid level. this time of the year, last year, it was actually very bad. it was at the lowest point

probably. then into spring and summer, it started to recover. and we hopefully will see the same pattern this year. >> i'm not holding my breath. i think we are not in a game of numbers for this year. >> the chinese new year, 10% of the revenues just this holiday period. it is significant but it is not absolutely major. i think they can survive. >> in between travel is restricted so we are focusing on basically providing the best possible experience for our guests. >> being drawn into the experiences. >> the challenge is on the merchant front, which is something we are always looking at. a lot of the service providers

on the mom-and-pop side, as well as a topline fashion. paul: some of our guests sharing their outlooks for the new new year travel. a bullish start to 2021 for hong kong and chinese markets. the hang seng topping 30,000 points despite the absence of southbound flows on wednesday. sophie kamaruddin has more on the hang seng. sophie: we are seeing the year of the rat, a 21st century forecast, mapping pitfalls. officially it kicked in february 3. according to horoscopes the hang seng could enjoy greener pastures by the years and but march will bring stumbles and the valleys will be peaking in autumn. metals is the dominant element.

financials are in a good position. areas under the influence of water, those are looking well. for travel, good news with travel and transport, seeing back to back from november but fire industries will have a struggle like tech and telcos and anything that relies on spring growth are seen doing well. guys, steer clear of construction. according to the feng shui forecast, it is muddling through. shery: don't you love those horoscopes? it has become an annual tradition to do them but i have to say, this year is so different. when we started last year in the new -- the lunar new year and the pandemic started, i don't think anybody imagined it would get this bad. hundreds of millions of people are supposed to travel every year during the holidays but take a look at this chart because this is plunging, the expectation is only around 1.5 billion people will travel. that sounds like a lot but this is china, that is 40% lower than

the pre-pandemic levels. trains will be empty. sophie: while travel might be on hiatus, that doesn't mean activity will be on pause. this is helping quite, type -- is helping some companies. the 12th biggest listed company surpassing the likes of anheuser-busch. consumer staples on the mainland gaining ground, the second-best sector year to date for the tsx 200 which will see another test when the lunar new year wraps up. keep an eye on that space when we come back from the holiday. paul: normally around this time you would see a spike in consumption and services. take a look at this chart. you can see manufacturing pmi's and services both slowing down in january. the effect of covid-19, still writ large. still to come, the

china open. ubs's senior vice president, giving us a market outlook as the inflation debate rages on. she says risk on amid the ev money backdrop. we will hear from investors at the bottom of the hour. this is bloomberg. ♪

♪ >> good morning. it's 9:00 in beijing and hong kong. counting down to the open. your last session of the year for the year of the rat in hong kong. president biden prepares to speak to xi jinping for the very first time since taking office. it comes amid tensions over trade and geopolitics.