haidi: good morning. we are counting down to the major market opens. shery: welcome to daybreak asia. haidi: tech is in the spotlight as asia opens. the tumble on wall street drags that nasdaq 11% below its all-time high. new measures -- u.s. bank leaders say they will strengthen legal defenses against --

jurisdiction. and delivering big expectations at 30% -- we will be joined by the companies president. shery: we start with breaking news out of south korea. we are getting the current account numbers for that month of january. the surplus narrowing to $7 billion after it widened in the previous month to over $11 billion. when it comes to the good trade surplus, it is narrowing. we've seen a recovery in the south korean exports market with shipments expanding in the month of january but with a decelerated pace for those exports, including autos and petrochemicals, so we are seeing their current account surplus and the goods trade surplus narrowing to 7 billion and $5 billion respectively -- respectively.

let's turn to sophie cameroon as we see sydney coming online. sophie: the narrative we see is this rotation -- just getting started even as the risk for higher yields remain. credit suisse sticking to their year-end target and excluding the u.s. at 375. note the condition with yields at 2%. those are some ways off. we are seeing that come through in sydney. tech under pressure, sliding more than 6% this morning while we see shares gaining ground with the 10 year yield edging up beyond the 180 level. the head of the tokyo -- ahead of that tokyo open, gdp do later today. nikkei future slightly higher while the yen is testing the 109 level after we saw the dollar rise to eighth three-month high.

you have new york crude extending losses after it saw the most in a week. it move pass it's 100 day line with bond yield gap narrowing and onshore u.n. wiped out its gains against the dollar. on the terminal, the u.n. stumble -- you on entering a technical correction as investors dumped popular trade amid valuation and liquidity concerns that keep chinese banking shares may be a bright spot. fidelity saying the sector makes for an undervalued recovery. haidi: the selloff in tech shares picking up on monday.

joining us to discuss the rotation trade is gibbs wealth manager and ceo. this is a continuation of a theme we've been looking out for a while. i want to plot the bloomberg chart because they were down on the day but 121 numbers if you look at the data point at the bottom of the panel hitting 52 week highs today. that's probably the most since about november. even as we see this spread before best and worst performers that we are starting to see more breadth in the market now. guest: and yes, this is something if you look at that chart for much of 2020, the breadth even as markets were going up, it was led by just a few companies, these mega caps we have been talking about. now that we see the sector

rotation, more stocks are participating. though we are seeing massive diversion between winners and losers, particularly in february, when you look at sectors with the biggest wins and the sectors with the biggest losses, the spreads are the largest since the march of 2020. last month was completely different, and that is what happens. you are seeing this shift and underneath the markets, there is this turmoil, this rotation as we are now a month and a half into this law and rotation, we are seeing more participants come out and we quote the nasdaq being down but there are so many other indices that are doing really well that give you a sense a larger portion of the companies are participating in the economic recovery.

haidi: and small caps is where we are seeing opportunity again. do you expect to see that extreme leadership rotation in small caps? erin: there has been diversion and a little sector rotation. don't get me wrong, i love markup financials. again, going with sector rotation and small caps, i also believe very strongly that investors, if they are looking for small-cap exposure, they can easily by a small-cap etf like the ishares because there are so many industries within the small-cap arena where they are expecting very high growth and have lower valuations. you don't have this really rich

valuation issue that you have in the large-cap space and so certainly, if you have the time to do the research, you can delve deep but given the type of risk reward, it's easy to buy a broad market index and reap the rewards in the small-cap arena. shery: financials have been historically cheap. is there more room to the upside? erin: yes. i believe so. when you look at the current discount, financials are still trading at about a 32% discount compared to the broader market. it is normal for financials to continually trade generally at a discount to the bond market, particularly in low interest rate environments, which is what we are. but the discount has become extraordinarily extreme in the past two years.

they have dropped from an average or historical average, usually 15% to 20% discount to 30% and 40%. until we get back to a more normalized 20% discount, they are still cheap and that is how i look at it. if you see this yield curve really spiking, we've been seeing this for almost two months, early the past four weeks have been a straight shot up in the first yield curve in some of the bond yields, there's still room to grow. it's not too late of a trade if you want to get in right now. shery: there's always a debate of passive versus active. where do you stand right now? erin: i think this will be a wonderful year for active managers. as we've seen in the sector rotation, already in february,

just looking at the broad market, even just the lat -- the last eight days, the s&p is up but if you took financials alone, you would be up over 10%. it really is about -- as we see smaller valued companies, you want to have the right picks before he could have a broad market in the mega caps. if -- there's a chance to strongly outperform the broader market if you look at this rotation and look at the new leadership ahead and take into account the yields and the stimulus programs coming through. shery: let's now get to vonnie quinn with the first word headlines. vonnie: janet yellen expressing

fears that the $1.9 trillion relief package will stoke inflation. treasury yields have soared in recent weeks as investors -- yellen spoke ahead of the house vote on the relief bill. protesters in myanmar defied curfew despite the military's increasingly tough response. u.n. and u.s. have called for security forces to free a group of protesters surrounded in a suburb. unrest continued across the country despite the army warning of jail terms of up to 20 years, shutting down media outlets and denying the right to work. the brazilian riau closed at its lowest in nine months after the former was cleared of corruption in the long-running carwash investigation. the supreme court verdict erases the decision for bribery, property deals and other alleged crimes. he remains the darling of the

left and the poor but many on the right say he's a symbol of brazil's economic mismanagement. a court in thailand has denied bail to three pro-democracy leaders accused of defaming the monarchy under the strict laws. thailand has seen weeks of protests and demands for change over -- although demonstrators insist they are not attacking the king. they are calling for more transparency among the kings wealth and power. 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 vonnie quinn. this is bloomberg. shery: chinese ev maker saw deliveries beat its own expectations and posted a smaller loss in the last quarter. plus big data points out of japan this hour. we will break down the final fourth quarter gdp print. this is bloomberg. ♪

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haidi: a bipartisan group of u.s. lawmakers is urging president biden to step up support for the people hong kong coming amid that beijing efforts to change the electoral process. let's talk to stephen engle in hong kong. what do these lawmakers want? stephen: it's getting interesting, isn't it? with another big change being mandated from the national people's congress -- last year it was the national security law and now it's significant electoral changes being debated and that u.s. is weighing end. a bipartisan group of senators and representatives in both chambers of congress weighing in , including republican senator mitt romney as well as democratic senator steve markey in a statement saying these election changes in hong kong

will only continue to advance beijing's ever tightening grip on hong kong or's autonomy. the communist party, the statement goes on to say, is doubling down on its attempts to impose an authoritarian system on hong kong and lawmakers are urging president biden to use unspecified new tools to support the people of hong kong. essentially, lawmakers on both sides of the pacific in this yawning dispute between china and the united states are vowing to dip into the toolbox. i'll talk about china's efforts in just a second, but i want to segue to carrie lam, she's just back from beijing and commented about changes to the electoral system and said in her estimation there are flaws and loopholes in the current system in beijing has the authority to make the changes. >> electoral system is an

important part of any political system. the proposal to improve the hong kong system is led by the central authority. i respect their dominance on this matter and its decision making power is beyond doubt. stephen: she went on to say she is not sure whether the currently delayed and re-scheduled legislative council would be able to go forward as planned because she says any changes coming to the electoral system would require more than 20 pieces of principal and subsidiary legislation. we are going to delve deep into these changes and what it means on hong kong's not only put a call system but judicial system with my interview coming later this morning. that's right here live on bloomberg television with hong kong's justice secretary. you don't want to miss that. haidi: looking forward to that.

you are also watching in terms of any potential countermeasures that could be a move suspected out of -- expected out of the biden administration? stephen: we read the tea leaves and as we get into day five, there is a regional group meeting, kind of mundane stuff, but we did have the national people's congress standing committee chairman, the number three leader in the commonest party hierarchy. he gave his annual report to parliament yesterday and said he used the analogy of a toolkit and said we will upgrade our legal toolkit for meeting challenges and guarding against risks in order to oppose foreign sanctions, interference and long arm jurisdiction. that's their way of saying the united states. by the time the trump administration left the white house, they had impose financial

input ago sanctions on at least 45 chinese officials, including 15 from the national people's congress, including carrie lam. beijing has done countermeasures but they have not had as much impact in washington, simply because on the financial front, the u.s. dollar has a dominance in the international financial system, much less so for the renminbi. beijing looking for ways to speed up ways of countering u.s. sanctions, not just on hong kong. haidi: stephen engle on the latest there. we will be joined later on by the china chairman. coming up, arc invest kathy wood is having her worst stretch of the year. we have a conversation with her just ahead. this is bloomberg. ♪ want to save hundreds on your wireless bill? with xfinity mobile, you can.

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shery: as the selloff in tech shares pick up steam, cathie wood says she's sticking to her conviction, including buying the tesla dip. cathie: when we go through a route like this, the rotation now is happening very quickly. it started off slowly and is happening quickly. so i'm happy the market is broadening out. this was the case in late 16 as well. value took off and left growth behind. whenever i see that happen, i say, ok, this bull market has broadened out and this is good news. what we do is concentrate our portfolios toward our highest conviction names. so that is what we are doing. we had extended the number of names in the portfolio from the low to mid 30's at the bottom of

the coronavirus and now we are at roughly 55 for our flagship fund and we are starting to sell the more liquid names and by some of the more pure play names . the more liquid names are either more mature, facebook, apple and so forth, or they are participating in innovation but they are not pure plays. regeneron, novartis, and so forth. more liquid in order to have cash like instruments to use at a time like now and concentrate toward our highest conviction rates. emily: what's talk about tesla. are you going to continue to buy the tesla dip now that it's defeat -- now that it's dipping even lower? cathie: yes. we can buy a stock up to 10% above our portfolios.

anyone can see that and we have been building wherever we can. we built up to 10% and the stock behaved in line with our portfolio, so we can't buy anymore here. if it were to deteriorate at a rate beyond that of our other portfolio, so drop below that 10%, we would have the latitude to buy more, of course. emily: you said you are going to put out a new tesla price target. the market is anxiously waiting for that. can you give us an idea of what the target will be? cathie: it's going to be in a couple of weeks. we are getting compliance that is helping us cross our t's and dot our i's.

the two things that have happened since the last projection is we have -- tesla has increase its market share. when we put out our original $4000 target, the equivalent of $800 now, we thought tesla shares would drop from 17% as a share of the electric vehicle market, the global electric vehicle market, from 17% to 11%. instead, its share increased as others with wonderful brand names started increasing the number of electric vehicles in their companies. that was a big wake-up. in the united states, i think tesla, through the third quarter at least, was still 80% of all electric vehicles sold in the united states, so pretty stunning. the second thing that has

happened is autonomous. the probability tesla gets autonomous right we believe has increased from the 30% we had in our base case in our last model. what's interesting about autonomous is the margins in autonomous, the gross margins are in the 80% range. the margins alone are in the 25% to 30% range. this is a five-year projection. so the model changes completely of tesla gets autonomous right. and we think it will. haidi: that was arc investment founder, xpong -- cathie wood would -- with emily chang. a london court is considering winding a position halted by

credit suisse and unraveling $10 billion of funds. regulations and germany have already shut down green silk local bank. apollo global has agreed to buy a holding that values the annuity business at $11 billion. they are already the biggest shareholder, controlling about 35%. apollo established the company in 2009 and has built it into one of the biggest fixed annuity providers in the u.s. american airlines has launched a bond sale worth $7.5 billion to repay government loans that helped it through the pandemic. early pricing talks are at the low 6% range. chinese ev maker xpong has been its own delivery expectations. they had a shortfall of about

$120 million as compared with the 176 million dollars in the first quarter and 152 million dollars one year earlier. revenue grew 350%. shery: we will be speaking to the xpong president about those results. you will want to see that conversation. let's turn to south korea. we are taking a look at what to watch -- the finance minister holds a meeting to review the economy and markets. he previous said -- previously said while sharp gems and prices are limited, investing shouldn't be. also on the corporate fund, sk biosciences ipo price at the top of the range, following a healthy appetite for the stock

during book building. the vaccine maker is policed to raise nearly 1.5 trillion one. the market opens in korea in about half an hour. this is bloomberg. ♪

>> we are getting japan january labor cash earnings seeing a decline of household spending of 1% year on year in real cash earnings falling .1%. probably a slightly better than expectations, let cash earnings on a year in your basis, falling point 08% were expectations were -- expectations were a contraction slightly better but that is still a 10 straight

month of declines when it comes to labor and real cash earnings in japan. we are looking at the impact in the latest state of emergency playing out and that is likely to have impacted overtime pay. we also expect to see the breakdown of the base pay before time -- for four-time work -- full-time workers may remain weak. the strength of the job market we have seen in japan suggest job security is at this point taking precedence over pay negotiations. bloomberg economics is expecting to see further wage weakness into the first half of 2021 given the leading indicator of corporate profits falling in the fourth quarter as well. let's take a look at the market reaction. sophie: nikkei futures opening to the upside, modest gains for japanese stocks while the yen is looking at the one i level. gdp as well this after he got

commentary from the boj deputy governors saying the central bank may still see ways for wider moves, so [-] when it comes to be is a stance. in australia the ells a yield curve this morning steady this morning that when it comes to stocks tech shares falling while energy shares to i are holding below $65 a barrel. rising at city on this-- citi on the pro cyclical tilt. and eight nasdaq 100 fall into a technical correction. [indiscernible] investors shift out of growth and into value names. on that, pulling up a chart on the terminal, bloomberg intelligence saying china's value rotation might be getting started, with potential runway to outperform against growth on the focus of financial reforms,

with the typical recovery and steepening yield curves which could lead to rating of chinese banks. doc could be a driver in china. haidi: taking a look at chinese electrical vehicle maker xpeng delivery speed its own expectations, the start of building a footing in the world's largest market for cleaner cars. joining us is brian gu, vice chairman and president. shery: let me get started with a question on deliveries. you released her first quarter guidance. given what you have delivered so far it looks like this month you would deliver fewer than 5000 units. it does not seem too ambitious given what you have done so far. why? >> thank you and a pleasure to be on this show again.

first quarter, we had guidance for 12,500 deliveries for the quarter. obviously it is a number we want to be very confident about. also, keep note that the first quarter is typically the lowest quarter given the seasonality in china, especially the chinese new year. there is no delivery of vehicles to customers, because of the holiday schedules and it is a short month as well, so typically the first quarter is much lower than the rest of the quarters. and in our case, we saw the drop in february as expected because of holiday season, marsh is awesome -- we expect march to pick up and given where we are in the cycle we want to be pretty with guidance. shery: so give us your demand outlook in terms of orders. we also -- you also recently launched two new models? >> we launched a battery version

of g3 and p7 models and those are lower cost. that allows us to price our vehicle more competitively. these versions will be delivered to customers the second quarter and that we expect will further broaden the customer base for products. looking ahead in 2021 we will introduce new products, in addition to the lp howard p3 and p seven, another one in the third quarter, as well as at their brand-new model which will launch in the fourth quarter, which will be incorporating the world's first production level lighter technology in the vehicle. haidi: outlook for deliveries in march going well is to do with the storage -- shortage in chips and batteries? zack went away on the forecast

for your company? >> well, i think -- is that going to weigh on the forecast for your company? >> i think we are keenly watching the batteries in supply chain. so far it has not impacted us and we have not seen an impact on our forecast for the first quarter. but particularly we have had the ability for two or three months so we are watching the long-range impact of these developments. and lucky for us because the volume that we will be delivering this year compared to larger oems like volkswagen and gm and tiny oems, a relatively small -- and chinese oems, are relatively small so it is easy for us to forecast replacement of capacity. haidi: you also have a second factory with capacity of a hundred thousand units and you expect that to operation of 2022? do you believe at that point there will be enough market demand to cover the cost of two

factories? >> well i think you know given the growth as well as the increasing of our portfolio, the plan will quickly fill its capacity pretty much by the end of the year so having the second plant up and running next year as a priority for us because we anticipate that capacity will be utilized quickly. shery: and you also have just delivered 100 cars last december in norway. what has been reaction so far and what are your plans abroad now? >> yes, we have delivered to max's together 200 g3's to the norwegian market. so far the feedback has been very positive. obviously this is very small step, for us to test market. we have actually planned this year to expand our present -- presence in continental europe including a number of additional countries. where we can build offices and potentially, stores. [beeping]

for us we want to spend the next 12-18 months to build out infrastructure, allowing us to sell our future products there clued in autonomous driving technologies -- future products there, including autonomous driving technologies. shery: and how will that affect to revenue outlook and when will autonomous come into play? >> for us, we are targeting autonomous driving technologies that can be incorporated it never vehicles, our production vehicles. for example we just launched our x pilot 3.0 which allows a driver can drive on highway in china using mostly the autonomous driving and they can actually enjoy that, that function. and we saw a launch that what we called the navigation guided pilot, more than 50% of the driving permitted roads being driven using this autonomous

driving technologies so that is very exciting for us to see the stickiness customers are having with our product. we expect to broaden that technology to include memory parking for example in the middle of the year so the car can park itself in a parking lot upon entering to the parking garage. also by the end of the early next year we expect our x pilot 3.0 23.5. that includes -- 3.0 to 3.5. that includes not just the highway but also urban style rose as well. -- urban style roads, as well. haidi: wendy breakeven? >> in the next two years we will continue to invest in our technology, build out an infrastructure and services network, as well as charging facilities. so i think the next two years will be investment base for us. but for us given the growth in

volume, i think the breakeven year will be probably 2020 come the end of 2023 or 2024. shery: when we talk about xpeng, we talk about the broader ev markets and how much advances tesla is making in the chinese ev market, right? especially when it comes to your xpeng sit-down model. do you look at it in that -- sedan model. we talk about tesla but there are so many foreign makers delving into the chinese ev market? >> you are correct and the chinese ev market is very competitive. you see not just tesla. a number of incumbent oems launching ev products, and most of those actually are models introducing this year, however, i think the type of dna that allows manufacturer to come up

with smart ev products are different, i think a lot of the traditional players are still very much focused on the electrification site where i think tesla and us are talking about making the vehicle smart. we believe those are long-term differentiations. going forward we are excited to see the technology becoming more [indiscernible] and adaptive by consumers in china. if you look for example in the cockpit in our vehicle the voice command is used on a daily basis by a driver for 90% of the driver population so these are exciting stats to see compared to traditional driving and vehicles. haidi: great to have you with us here on bloomberg tv, and more big voices ahead today on bloomberg tv.

the deputy chairman will discuss the casino operators latest results we also hear from that hotels association and the hpc chair. let's eat you to vonnie quinn with first word headlines -- let's get you to vonnie quinn with first word headlines. >> china to counter u.s. sanctions trying to beef up its legal toolkit in the face of american measures and the national people's congress will move on to discuss china's latest, 14 five-year plan, and move to revise the electoral system in hong kong. a bipartisan group of u.s. lawmakers urged president by maker said biden to support the people of hong kong, after changes to the city's electoral system. chief executive carrie lam confirmed another proposed reform may have a delay for elections. working to curb the campaigns of

candidates deemed insufficiently loyal to candidates -- to china. >> the proposal to improve hong kong's electoral system is led by the central authority. i respect the central government's dominance on this matter and its decision-making power is beyond doubt. >> former president from collapsed -- last remaining bid has been dashed. justices refuse the appeal against results in wisconsin but if given no comments. last month the supreme court rejected an appeal seeking to reverse results in wisconsin and other states. we see new indications the planet is heating up with temperatures in the arctic much warmer last month than average for the past two decades. northeast canada and greenland were also warmer than usual in february, with forecasters linking events to extreme weather elsewhere around the world.

that includes the blast of cold air that froze the western u.s. last month. global news 24 hours a day on air and at bloomberg quicktake. bitcoi --powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. haidi: next, japan's final fourth-quarter gdp due out in a few moments. labor cash earnings numbers previously. we will speak with an exece from fujitsu. this is bloomberg. ♪

>> let's take a look at japan final fourth-quarter gdp numbers due out in a few minutes and we expect growth to remain in double digit territory. bond traders will be on alert after the boj deputy indicated the central bank may still seek ways to allow more moves in yields. . this after the boj boss rejected a widening of the yield in the range. panasonic said to buy blue yonder to deal worth $6.4 billion. we are looking ahead to the gdp particularly after we continue to see weakness when it comes to wage growth and household

spending. shery: a number we just got 20 minutes oh. so let's discuss this with the fujitsu chief policy economist artan schulte. -- martin schulte. great to have you back. we did get wage numbers earlier and skin easing a contraction. coming out of taiwan we see diversions between industries. some doing really well and others not. how does it add to complexity when it comes to policymaking in japan? >> [laughter] the complexities about restarting economy. the last quarter 2020, when we are getting numbers, not much of a revision because investment is rolling on, but slowly. we had a huge slowdown in the beginning of the year, the emergency will and in two weeks. after that the economy is coming out. so these never's are giving us an indication in the second quarter this year the economy will be going by about 3% again

and that is good news. haidi: we did have the latest. shery: a state of emergency extended in tokyo, without affect the numbers for the third quarter? >> in the first quarter yes a problem getting economy rolling, everyone was more optimistic at the end of the year and then a december numbers were coming down getting for the emergency. now it is really about preparing numbers, the covid numbers are really down. preparations for liv-ex are starting. -- preparations for the olympics are starting. haidi: is the olympics worthy of economic optimism? i understand how important it is symbolically but are you going to get a boost from tourism and the other ways you expect this to be paid back, with another event in noncovered times? -- in non--covid times? >> the olympics cannot cover

their cost, that is so true. the main point here for japan is really showing off, this is not about getting that covid crisis behind us, it is more about long covid, how to prepare for the future. all this will not be done by this year and even next year all will still have to deal with the virus and this is the first really big event where something can be shown, what we can mix in terms of digital and getting something going and enough people in what becomes interesting. getting a new balance. haidi: infirmed -- in terms of what the bank of japan can do, we have the rest of the world trading on reflation expectations. we have not seen meaningful inflation in japan through this. has the boj reach the end of its abilities to conduct extraordinary policies to stoke inflation? >> the bank of japan also goes into a major policy review and

they will announce it also into weeks. -- in two weeks. we probably get a move away from the macro stance we have been seeing over the last year, pumping in 10% from gdp from the bank of japan and 25% from the government. now it is about becoming a trendsetter again by doing something different. that is probably focusing more on digital. supporting the government with activity reforms -- proactivity reforms and buying bonds smarter than just government bonds. shery: we are getting fourth-quarter gdp growth now coming in at an annualized 11.7%. so the annualized number coming out at 11.7% and quarter on quarter and 2.8% growth and nominal quarter on quarter growth of 2.63% -- 2.3%.

when it comes to the breakdown of those gdp numbers, private consumption rising 2.2% quarter on quarter as expected. and business spending rising 4.3% quarter on quarter, higher than originally expected exports adding 1.1% to the quarter on quarter and gdp. an inventory under pressure. let me a revision downward, compared to what was expected? >> this is december before it was restarting and that was clearly a third wave of corona coming in and the first quarter this year will also be weaker and i expect it will hang out at 0.1% growth and it may be worse

than the more important point is getting this going again and this will be 3% in the second quarter and that should be better. haidi: martin, what do we see when it comes to where that yen goes from here? we think -- have seen first up breakdown when it comes to the correlation between japanese stocks and the yen, where does it go from here? given the conflicting forecast we have seen for the u.s. dollar and treasury yields from here? >> well, exports are driving this economy still, very important, in particular because manufacturers are doing better the surface sector which is been partly shut down. but the demand from overseas has been driven by restarting economies. in asia and china not driven by the economy, and that has been weaker the last month as the crisis and interest rates are going up and that helps the

japanese economy as well. haidi: fujitsu chief policy economist martin schulte reacting to the final gdp numbers coming through. we are seeing moderation when it comes to the growth picture. more to come on "bloomberg daybreak: asia" this is bloomberg. ♪

haidi: a quick check of the

latest business flash -- business flash headlines. revenue this quarter beat expectations, customer growth to linger. logic said revenue discord will range from 735-7 $50 million, 10% above analyst views, which matches 500,000 mainly chinese merchants with millions of shoppers. french drinks maker is reportedly weighing a bid for an australia wind estate -- wine estate. three ports that treasury wine has received an offer from american private investor firms. paypal is buying crypto come curve to boost its role handling cryptocurrencies but paypal has been building up a unit dedicated to cryptocurrencies after it began letting users

buy, sell, or hold digital tokens and its wallet. curb has around 14 employees and paypal says they will join the new team. the deal is expected to close by the midyear. -- curv. shery: we are watching sk chemicals insole after its at the ipo price of its sk bioscience unit at the top of the range at 65,000 won. take a look at japan, corporate debt outlet chain -- outlook changes, revised to negative from people also changing the outlook on softbank to stable from negative, moody's siding -- from negative to stable siding progress. also panasonic and talks to acquire a u.s.-based software firm will yonder for 700 billion yen, $6.5 billion. also keeping an eye on semiconductors in asia, after the philadelphia semiconductor

the next tumbled raising gains for the year, among possible movers, some career names and ship processing equipment maker. japan and south korea open at the top of the hour. this is bloomberg. ♪

>> welcome to "bloomberg daybreak: asia" >> asia's major markets have just come online and these are top stories. tech is in the spotlight at the open after a tumble on wall street, the nasdaq 11% below its all-time high. china promises new measures to counter u.s. sanctions. leaders say they will strengthen legal defenses.

and president xi says he wants to build a powerhouse without creating extra powerful entrepreneurs and we discuss the challenges for business and regulators let's get you to the market open in tokyo and so. sophie: diversions for the knee can topix with the topix outing .4%. consumer names after got up he data from merchants in february, they turned optimistic for the first time in two years on the economy. plus a final read on fourth-quarter gdp for japan, a double digit growth at 11.7% on an annual basis. speculation continues as to the boj stance on widening the yield been following comments from the deputy governor. he may prevent active buying in today's five-year auction, according to morgan stanley. you have the 10 year yield at 14 basis points this morning. south korea, the be ok says it will buy up to 2 trillion won in

today's auction to ease yields volatility, trading at the lowest level since october, 20 19 while the tech heavy kospi is under pressure this morning. watching to see if a global tech's lf may provide buy the dip opportunities. financials are providing a lift for the benchmark in sydney. wti around $65 in the face of a stronger dollar. [indiscernible] falling in sydney and tech names under pressure to exceed expectations, entering correction territory. the u.s. 10 year yield opening slightly lower this morning in the asia session. the offshore yuan trading at 655 after it reached a 100 a light which accompanied a steep drop in chinese stocks, that push the

cfi 200 into a correction. shery: our next guest has been taking profits and found new positions in small caps. joining us from hong kong, sam, great to have you back, we are seeing this huge rotation, and you are not the only one taking profits now. return seem to be more broad based, what you make of the latest moves? >> people are focusing on the money and the yield curve, inflationary expectations are going up. therefore momentum stocks, the risk on trade, is coming to an end. we have seen the focus for us on valuation, we have come to almost find me want to hold forever had gone beyond even our blue sky valuation, so we have to remain disciplined. we have taken profits and some names we held since the inception of our fund, byd, c

limited, we sold our position the hong kong stock exchange. we are seeing tech and internet names even last night you see the chinese adr they had a tough night. shery: what stocks are you looking into? we know you have found positions in small caps but not all small caps are equal. >> that's right, the true thing for us is the structural growth in china. and while we have said that many times we truly believe it is there, you can see it in the mpc meeting in terms of 11 million urban job creation, unemployment 5.5% the target, steady cpi at 3%. we believe in the growing middle-class. right now 400 million middle-class in china, or even 400 million chinese millennials, people born after 1980 -- 1995. and we believe that will be structural in china for 10-20

years and they're still businesses, and we are finding true value there, so we have been selling some of our big caps and holding a bit of cash at the moment which we do not like to do. we are finding opportunities. the selloff has been broad-based but there are some opportunities. haidi: i understand you cannot disclose those positions they are both in the small caps space. is that because you see less of the extreme leadership rotation within small caps at the moment? >> great question. what we are seeing now is, we are long only buy and hold patient capital invest for five years. we are seeing hedge funds really turnaround and go ultra long, ultrashort, volatility is going up. they're not really playing the small caps space, where the large caps are coming up a lot. small caps are, i think we are buying stocks in the small caps space less than 10 times earnings and seeing earnings grow at 25-30%.

business is we think you next mid-caps interesting space, with the compounding long-term return. you have to be creative buying in the step in terms of large caps -- buying in this cip, -- dip we, are not necessarily bind large caps, we are buying elsewhere. haidi: does that mean you were less about oscillations in the bond market? >> we are not experts in this bond yield. everyone seems to be, next blend take -- it inflation expert, and we are not putting her hand up. we are viewing it and saying we are surprised in the blink of an eye the tenure has gone from 90 to 160 and we have no idea -- the 10 year has gone from 90 to 160 and we have no idea where will be going from here. i don't think you will see chinese millennials and that they would stop purchasing products. it will impact the way the market values businesses. the high.

stocks -- high p stocks you will see the risk-free rate goes up and the way people adjust the value per capital you will see decline evaluations. that is fine we believe to be balance funds and including value and we are not going to predict. the yield curve could go up and down and we are not sure where it is going to go, but we are sure on the structure in china. shery: and sam you have been sure on some calls and south korea. yet, we are seeing perhaps -- i wonder how strong growth really is in south korea, if you take out the semiconductor side of things. you have a call in sk hynix, at the same time we are going to see a ban on short selling and south korea lifted soon. >> i think that is going to happen on my birthday. [laughter] what we see in korea, an

interesting market. we like sk hynix, a massive supplier of semiconductors not just integrated circuits but also memory, structural under supply will happen through to next year. cookout is our big pick in korea, wonderful businesses, lots of moving parts come internet banks, online games, and it its advertising business -- kakao. it is a real ecosystem we think will continue to grow. outside of that we are selective. korea has been very kind to us, a lot of output and we want to be selected going forward because it is have a huge run. haidi: [laughter] sam, you can noise be relied upon to be constructive on -- sam, you can be relied upon to be constructive on korea picks. great to have you.

vonnie? vonnie: final gdp from japan, the economy grew by double digits last year showing resilience despite the virus emergency measures. gdp rose annualized 11.7%, december from the prior quarter, a touch weaker than estimates, while economists had forcing growth of 12.6%. the brazilian real closed at its lowest after the former president was cleared in the carwash -- investigation, erasing decisions against him for bribery and property deals and other alleged crimes. he remains a darling of the poor but many say he is a symbol of brazil's economic mismanagement. protesters in myanmar the fight a curfew monday despite the military's increasingly tough response. the u.n. and u.s. called for security forces to free

protesters date surrounded na young gone suburb -- in a yangon, with threats of gel terms of 20 years shutting down media and denying the right to work. -- jail terms. thailand, has seen weeks of antigovernment protests in demand for change. demonstrators call for transparency around the monarchy's wealth and power. global news 24 hours a day on air and at bloomberg quicktake. powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. shery: still ahead, can china builds the technology industry well reining in its entrepreneurs with discussed, next? also cambodia-based casino

operator naga core reporting and 80% drop in full-year process, the deputy chair speaks with us exclusively. this is bloomberg. ♪

haidi: a group of u.s. lawmakers is urging president biden to step up support for the people of hong kong. shery: this coming amid beijing's effort to change the electoral process. in beijing, john, give us the latest on what lawmakers here in the u.s. are asking or and what can be done? given the changes in progress in beijing? >> lawmakers in the u.s. now are asking the biden administration to do it can to support the city of hong kong and its citizens, in this ongoing saga. how much they can really get

done is questionable, there are sanctions in place. american sanctions against chinese officials including the chief executive carrie lam in hong kong. that has not as of yet stops beijing from going forward with the tightening of its grip over how hong kong is governed. shery: we continue to hear the latest on what the chief executive carrie lam is saying about some of those changes. that she is even unsure the upcoming legislative elections will take place, that they could be delayed again. what could we see in those changes? >> the folks at the national people's congress meeting this week, the full session, they would've most certainly approve a proposal on thursday this week to give the standing committee of[--]pc the right to draft legislation to give them the right to overhaul hong kong's legislative system and we probably would not see details

until late spring and early summer. the implementation process then. you could potentially cd legco elections in hong kong scheduled force timbre move back because of this -- scheduled for september moved back, but it is hard to say what the actual delay would be like. shery: we saw tensions ongoing between beijing and washington, upgrading china's legal toolkit to do a challenges? to deal with perhaps other countries? that seems to refer to washington? what without look like? >> beijing's problem is how can china respond to american sanctions without shooting itself in the foot. in hong kong, for example there are american sanctions against carrie lam which have resulted in carrie lam not being able to get a bank account in hong kong. that peeves the chinese.

but if china goes in and tells the banks do not follow u.s. sanctions what will the banks do? will it undermine hong kong's position as the global financial hub? these are hard questions were beijing right now. haidi: the executive editor in beijing with the latest. beijing's crackdown on jack ma and his e-commerce empire has caused a shadow on parts of the tech sector in china. our executive editor has been speaking with aunt winners and venture capitalists. -- with entrepreneurs and venture capitalists. what did you find out in your reporting? >> yes, the crackdown on jack ma began last year. there were antitrust investigations announced against alibaba and other giants in the tech space, also ant group, the financial affiliate of alibaba that jack ma help to cofound, had to pull its ipo test days before his offering. in

singapore. we found there are proponents for this crackdown inside and outside the government but as we talk to auditors and venture capitalists we found widespread concerns about what this crackdown means for the future of animation in the country -- future of innovation in the country. there are people concerned about the lack of transparency from the government who have not explained details of what is going on behind the scenes and why there was this crackdown on alibaba and ant, and other tech giants. there are concerns that now, as an entrepreneur or founder in china, is not the time to take chances. we found entrepreneurs are hiring more government affairs people to make sure they do knocking on the wrong side of government and are trying to be more cautious. some are trying to expand overseas so they are not is exposed to the chinese to domestic market. shery: when you talk about supporters outside government of the crackdown, it is speak because of perhaps mop -- perceived monopole listed practices?

and is beijing doing enough? >> yeah, that is on the antitrust front there are concerns alibaba and tencent had just gotten too powerful, that they were dividing the chinese text fear into two major ecosystems -- tech sphere into two ecosystems they controlled and were suppressing competition, so the ark legitimate concerns on that front. the opposite side is jack ma is by far the most high-profile entrepreneur in the country, the most successful in the country. so to have this very public taking down of the most famous entrepreneur in the country, sends a signal to entrepreneurs. that maybe they cannot be entrepreneur -- as outspoken, maybe it was dangerous that he was too successful in some areas particularly if you run up against state backed companies. or local officials in different areas. so there is caution that has

crept into the chinese ecosystem, we had not seen before. china had a tremendous run, in terms of tech startups that became successful. venture capitalists were pouring money into the market. it was the only viable competitor to the u.s. in terms of tech supremacy. we saw bytedance and others emerge from this ecosystem as global leaders in tech. but now there is this note of caution in the ecosystem because of the crackdown. haidi: this tension between regulation and innovation at the core of this? does it work for broader ambitions to build homegrown tech champions if he is not willing to let individualistic entrepreneurial list behavior take place? >> it is a very good point. we are an unprecedented territory here. china is trying to build its technology industry with very big ambitions, big plans, for

building certain sectors like the semiconductor sector and artificial intelligence, other key areas. but the history of the free market in china is fairly limited. we have never seen this kind of antitrust crackdown before so we don't have precedents like what you saw the u.s. with at&t or microsoft. it is unprecedented territory and the lack of transparency has raised concerns. they do not know where the government is going to go now. that has raised worries in the technology sector, particularly among entrepreneurs really bake ambitious ventures. shery: peter elstrom, our bloomberg asia tech executive editor with the tech crackdown in china. we will have more perspective on the business environment in the mainland. we speak to anchan china chairman regula given that our also theresa chen joins us

later. coming up, student protesters and yangon, a night red sparks international alarm as protests in myanmar intensify, the latest ahead. this is bloomberg. ♪

haidi: a night raid on student protesters in yangon has drawn international alarm as antimilitary protest in myanmar intensified. krause decided monday night to resist the crackdown -- crowds decided monday night to resist that crackdown and the situation contains to intensify in myanmar, despite international condemnation. it does not look like there is much stepping back from either side? >> yes, we heard from the military chiefs and coup leader last night.

basically saying, the media is getting it wrong. that the soldiers are using the minimum force necessary to control crowds. the death toll continues to rise. more than 60 people now including two killed yesterday. it is still unclear what happened last night in yangon. yen mark continues to block the internet overnight -- myanmar continues to block the internet overnight. at the time it went down there were still people trapped in the neighborhood, security forces going door to door looking for student protesters. statements of concern from the u.s., u.k., to the u.n., sending tweets about it, expressing alarm. shery: we also had an update on the australian economic advisor to aung san suu kyi. what do we know about his detention? >> we heard from the army chief last night saying, sean turnout,

-- chernell, an advisor, was trying to leave the country and they stopped him ahead of time, and found unspecified state secrets he possessed, so it is very unclear what that would entail. there tend to be broad definitions of state secrets, particularly by authoritarian governments. so, it could have just been something innocuous, or not. either way, it signals the regime is not owing to release sean any time soon and this has been demanded by the australian government, which cut military cooperation with myanmar yesterday. all in all it shows the generals are staying defiant against the international community. shery: what are we seeing in terms of actions because we saw sanctions from the west but

nothing much from asian economies? >> yes, that, they have put bilateral sanctions. the eu is considering them. we have seen statements of concern from asian countries including strong language from singapore, strong language south korea but nothing concrete. the singapore prime minister argues sanctions will not do anything anyway, that the generals will not change course. yet, that means the generals probably are not going to face u.n. security council sanctions with china having a veto. there's a limit to how much pressure could be applied on that front. shery: dan kinkade, our bloomberg asia managing editor with the latest on myanmar. the latest business flash headlines. activist investor carl icahn talking to first energy about

potentially taking two seats on the board. he has built a sizable stake in the utility and we are told it is focused on helping the company put of federal corruption scandal and other issues to one side. sources also say carl icahn does not want control of the board in part because first energy still is heavily regulated. apollo global has a veto by athene holding in an all stock deal that values the business at $11 billion and apollo is the biggest shareholder and the deals expected to close early next year. apollo established athene in 2000 night and built it into one of the leading annuity providers in the u.s.. greensill capital filed for administration the u.k. after key backers walked away over concern about asset valuation and the london court is considering a winding up petition by credit suisse squeezing and unraveling $10 billion of funds of greensil

products. coming up, ark investor cathy wood, is still buying the tesla dip, our interview next. this is bloomberg. ♪

some breaking news when it comes to australia. australia bank business confidence and condition survey. february coming in at 15, much better than the previous month of seven. business confidence comes in at 16. much better than the rating of 10 in january. a turnaround and a rising confidence levels getting higher in february. 16, the highest level since early 2010.

gains across all states and industries except retail. business conditions to return to multi-year highs. overall, strong conditions being seen by the business confidence surveys. what are you watching? >> market reaction muted with the aussie dollar trading nearly one month low. a near-term risk that the march forecast, seeing medium-term fundamentals remaining. he had 83 by the end of the quarter. being led higher by financials this morning. tech shares are weighing that gauge, off by 5%.

the nasdaq falling into correction territory. the kospi has slipped love that 3000 level. upon futures, we are seeing them falling on rising bond volatility. the single, up to $5.8 billion worth of supply. turning the board to what has been going on elsewhere in japan, the dollar staying on the front foot, you are seeing the yen reached the handle for the first time since june. when it comes to the share market, the topics gaining ground. financials, consumer names, energy and tech shares. the news report that it is set to buy blue yonder.

shares are gaining ground this morning. toyota withholding still. >> let's turn to vonnie quinn with the headlines. >> the president's near $2 trillion inflation package, fears that it will stoke inflation. investors weigh faster u.s. growth and rising prices. yellen spoke ahead of the house vote on the relief bill. the toolkit, what beijing calls long arm jurisdiction. the national people's congress, the five-year plan, and moved to revise the electoral system in

hong kong. a bipartisan group of u.s. lawmakers has urged president biden to support the people of hong kong after trying to flag changes to the city's electoral system. chief executive carrie lam has confirmed the proposed revamp. beijing is working on new rules for the territory. former president donald trump's last remitting bid to challenge november's election has been dashed in the supreme court. last month, appeals seeking to overturn bidens when in wisconsin and four other states. 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 vonnie quinn. this is bloomberg. shery: in the u.s. markets, we continue to see tech shares

continuing to selloff. now, ark investments founder and ceo saying that despite this, she is sticking to her highest convictions including tesla. she was speaking with emily chang. >> when we go through a rout like this. first of all, rotation now is happening very quickly. it started off slowly. so i am happy that the market is broadening out. this was the case in late 16 as well. value took off and left growth behind. whenever i see that happen, i say, ok, this market has broadened out. this is good news. what we do is concentrate our portfolio toward our highest conviction names. we had extended the number of names in the portfolio from the low to mid 30's at the bottom of the coronavirus. now we are at roughly 55 for our

flagship fund. we are starting to sell the more liquid names and some of the more pure play names. the more liquid names are either more mature, the facebooks, apples, and so forth, or they are dissipating in innovation. more liquid, in order to have cash-like instruments in order to use at a time like now and concentrate towards our highest conviction names. >> let's talk about tesla. you said you would only buy the dip. are you going to continue even though it is dipping even lower? >> yes. we can buy a stock up to 10% of our portfolios. we report our holdings at the

end of any day. so anyone can see that. we have been building whenever we can. we built up to 10% last week. so the stock behaved in line with our portfolio. we cannot buy anymore here. if it were to deteriorate at a rate below that of our portfolios, we would then have the latitude to buy, of course. >> you said you would put out another price target. the market is anxiously waiting for that. when will we see that? it is going to be in, i will say a couple of weeks. compliance is helping us do everything we should do before we send it out. two things that have happened to tesla since our last projections.

one, it has increased its market share. when we put out our original $4000 price target, so the equivalent of $800 now, we thought the tesla share would drop from 70% -- this is share of the global electric vehicle market. from 17% then took 11%. instead, it's share increase as others with wonderful brand names started increasing the number of electric vehicles in their company. so that was a big, pink wake up. in the united states, i think tesla through the third quarter was still 80% of all electric vehicles sold in the united states. so pretty stunning. the second thing that has happened is autonomous. the probability that tesla gets

autonomous right we believe has increased from the 30% we had in our base case in the last model. so, what is interesting about autonomous is the gross margins are in the 80% range. the margins for electric vehicles alone are in the 25%-30% range. this is a five year projection. so, the model changes completely of tesla gets autonomous right. and we think it will. >> ark investments founder and ceo speaking with emily chang. a renaissance for mutual funds and a philosophy on focusing on disruptive innovation -- disruptive innovation. her latest pieces being well read.

you say china cannot have it's on cath -- its own cathie wood. what about the investment environment makes you say that? >> investors, the etf's mutual funds. whenever they see a celebrity manager, they will flood that manager with money. but as soon as the fund starts to dip a little bit, they will exit. in a recent survey conducted last october, the number was like 30% of the investors, mutual fund holdings within a month. another 20% were redeemed in less than three months. basically that they cannot hold on. number two, the other managers. as soon as you have a star manager like cathie wood, everyone will buy into the exact

same stocks. these are the two biggest problems that i see in china. >> does that mean we will never get a star manager in china? >> i do not think that will be the case in the current environment. the retail investors, when they see their funds sold off, they will go to china as a way to basically -- even fund managers verbal abuse. if you are a fund manager, would you want to run a mutual fund, you are better off running a privately held hedge fund. >> our bloomberg opinion columnist with a really interesting take on why you would not see a cathie wood in china. cambodia-based operator mega corp. saw a steep drop in revenue amid lockdowns and restrictions in the region.

we will have an exclusive interview with the deputy chairman next. this is bloomberg. ♪

>> full-year results for cambodia-based casino operator nagacorp show the impact of the pandemic restrictions that closed its flagship casino for months in 2020. 2020 revenue fell 50%.

for more on those results and the recovery prospects, we are joined from perth by the nagacorp deputy chairman, philip lee. it is difficult to assess these numbers given that we know the operating conditions last year were very tough. let me start by asking you about the prospects for recovery then. >> thank you for having me. if you look at 2020, profits have dipped. but if you look at the overall situation, i think naga did remarkably well in a period when we were closed effectively for months. net profit, 265. i think we will probably be one of the few profitable gaming companies in the asia-pacific. so, really, very unique

demographics of our customer base. very large elation. koreans, taiwanese, chinese, native singaporeans. those being the focus point for really, there is not much for them to do at night. entertainment, gaming. that has helped drive our market business despite a very difficult environment. in terms of recovery, if you look at how we have performed in 2020, with all these restrictions in place, we expect that with the opening of the borders, the travel restrictions being lifted. in 2019, they were 6.6 million.

that dropped in 2020. so, we expect a resurgence to come about once travel restrictions are lifted. haidi: has there been any implications for the development of naga 3 or naga russia? philip: we are starting foundation work over the next few months. we are expected to complete it in 2025. just to remind you, naga 3 will be our flagship product. it will be about 93% of the area for non-gaming space. so very much moving our focus from traditional gaming business to more leisure-entertainment focus. russia, there has been a slow down mainly because work on the

ground had stopped because of covid. we are still expected to complete that next year. haidi: what about building that integrated tourism facility near the agricultural park? we saw some controversy over unesco criticism. >> that was the other project i was going to talk about. located in relatively close proximity to angkor wat. we want to contribute to tourism infrastructure projects in cambodia. we want to increase tourism numbers. and allow tourists to spend longer days in cambodia. that is a project we announced a couple of months ago. we will definitely work very closely with the government as well as unesco to make sure we

comply to whatever requirements. required for the development of that site. but we are developing that very much in the interest of the country. shery: when you look forward, how do you see the breakdown of local versus ex-pat or foreign demand in your business? philip: i think to look at that, foreign residents in cambodia, and from various countries around asia. moving forward, if you look at the macro economic, gdp is expected to grow at about 6%-7%. this is going to feel -- this going to fuel foreign direct investments. with foreign direct investment, you get an increased business population.

moving forward, we expect our focus on it to grow. for 2020 for instance, in terms of contributions, 59%, so that, because that is very much sustainable and a deep market for us. so, with that kind of confidence actually, we are looking for 20 between one in fact, for 2020, the second key point we want to talk about is diffidence. the strong performance in the second half of 2020, we are proposing a dividend payment of 100% of our net profits for the second half of 2020. this is a reflection of our confidence of the recovery and future growth and sustainable

cash flow. shery: philip lee, always great having you on. nagacorp deputy chair joining us exclusively. some breaking news. we are getting the latest on sonic, which is falling as much as 5.8% at one point. the company really taking a dive after reports that it will buy u .s. ai software developer blue yonder. we are seeing the downside pressure on the stock. this is bloomberg. ♪

shery: chinese electric vehicle maker is surging past its own expectations in the fourth quarter. the chairman and president gave us his delivery outlook for the next few months in this exclusive interview. >> typically the lowest quarter given the seasonality in china. there is no delivery of vehicles to customers because of the holiday schedules, and it is a short month as well. typically, the first quarter is much slower than the rest of the quarters. in our case, we saw the drop in february as expected.

we expect march to pick up. i think that given where we are in the cycle, we want to be prudent with our guidance. >> ok, then give us your demand outlook in terms of orders. >> we recently launched a battery version of the models. those are actually lower cost and allowed us to price our vehicle more competitively. these versions will be delivered to customers in the second quarter and that we expect will broaden the customer base for our products. 2021, we will be introducing a number of new products. in addition to the g3 and p7, we will have a facelift of g3 delivered starting end of the third quarter as well as a third

brand-new model, incorporating technology in the vehicle. haidi: how much of the cautious outlook is to do with the shortage in chips and batteries? is that something that will weigh on the forecast? >> we are watching the development of the chip as well as battery supply chain. we have not seen the impact in the forecast for the first quarter. i take we had the ability for 2-3 months. so we are watching the long-range impact. folks wagon, gm, so we hope it

will be easy to source a replacement as well as finding capacity. haidi: you have your second factory under construction with production of about 100,000 units. you are expecting that to go into operation in about 2022, i believe. do you think at that point there will be enough market demand to cover the cost of two factories? >> i think given the growth and increasing of our portfolio, the plant will complete fill its capacity. much by the end of this year. heavenly second plant up and running by next year is the priority for it. haidi: and you also have just delivered 100 cars in norway last december. what has been the reaction so far and what are your plans? we have delivered two batches, about 200-plus g3's to the

norwegian market. this is a very small step for us to market in europe. we have plans this year to expand our presence in continental europe including additional countries where we can build offices. i think we want to spend the next 12-18 months relate to build out the infrastructure, allow us to sell our future products there haidi: when did you break even? brian: i think in the next two years, we will continue to invest in technology, buildout and infrastructure and services network as well as charging facilities. i think that for us, given the growth, i think the breakeven year will probably be 2023 or early 2024. >> that was xpeng president and

vice chairman brian gu. stay with us. bloomberg markets china open is next. this is bloomberg. ♪

9:00 a.m. in beijing and shanghai. we count you down to the start of the trading day on the chinese mainland and right here in hong kong. tech in the spotlight after a tumble on wall street drags the nasdaq 11 percent below its hybrid chinand