haidi: very good morning, we're counting down to asia's major market opens. shery: welcome to daybreak asia. our top stories this hour, a start to the week after jay powell/prospects of stronger growth and hirings in hong kong and japan are pointing higher.

alibaba says thank you to regulators after getting slammed with a record fine. the penalties could have been much worse. and, we look at the bleak picture of the emerging markets with virus cases continuing to surge in india. let's turn to sophie very check of what to expect across asia trading. >> we could see tepid gains for asian stocks. this after fighting losses led by china and tech losses in the region. still, vaccination in tokyo, osaka, now on this monday, fed chair jay powell flagging the biggest risk to the economy as a resurgent spread of this section. we are waiting as well, you have the s&p ahead after benchmarks capped a three-piece rally on friday. the dollar is trading flat.

we see a curve to the 10-year note -- 10 year yield, adding about five basis points. the rpi is expected a jump to record high. taking a picture of this monday, stock across asia, pulling up a chart on the terminal, we are seeing asian stocks lagging in the u.s. and europe. the investors reconsider to market leadership. asset management, they have been priced in in asia. from overweight primarily due to the less bullish gains on chinese stocks. from the central bank, authorities address financial risk. speaking of a chart on the terminal, we are watching for updates and any rating from alibaba. there are currently 29 buys with

12 month price target from analyst far outpacing performance for alibaba and hong kong. haidi: staying with alibaba, they have taken the unusual step of thanking chinese regulators after the record fine. the amount was based on 4% for the revenue, actually far less then the 10% allowed under chinese law. still, historic. as we go over to stephen engle with more. the thanks that was given, trying to reset the relationship with regulators? reporter: you know, on saturday they put out a statement saying alibaba is ready to move on from this saga. in looks as though the regulatory punishment will allow alibaba to do so.

this is an expensive slap on the wrist. 2.8 billion u.s. dollars is not a small amount of money. but, if i can say so, they can afford it. this is not a worst-case scenario. it did not have an order to have divestment of key asset. it is a fine. and the investigation for the most part into antitrust, monopolistic behaviors lasted for months. it pretty much concluded. so, they can now move on. it will be a part of this settlement, that includes stopping the practice of forcing mergers to choose between alibaba and other e-commerce providers. it was probably underway at alibaba. this settlement on the conclusion i should say does not settle what is going to happen to the 33% syntax which all

kicked off in october or november when jack ma's comments. criticizing regulators that if we connect the dots, sort of led to the collapse for a record beating ipo. we still do not have a complete picture of how it will be reshaped, whether it would be beholden to a holding company. what is going to happen to the lending arms. and, a direct threat. but, at least on the anti-monopoly front, alibaba and that investigation looks as though the opening salvo is complete. there will be a $2.8 billion fine. it could've been worse, the fine is equal to 4% of 2019. domestic revenue under chinese law, it could've been his highest 10% fine.

there is no order for breakup or divestment. shery: so, what will moving on look like for alibaba? reporter: they will definitely have to change particular waves of business. forcing businesses to choose alibaba. the key question will be the fintech arm, in payments and micro lending because we don't have resolution on that. also what will happen to the media holdings. scrutinizing the holdings, the south china morning post. what is going to happen to those holdings and whether that is a deeper, not monopolistic investigation. this is something about

influence, if you will. alibaba perhaps has too much influence in online and media. that is a chapter we have not uncovered yet. and a big one. also, what will happen with other companies that perhaps fall under new regulatory framework. that will really scrutinize expansion and everyday activity. possibly squeezing out other competitors in what has become an extremely competitive environment. new businesses coming out in social media and video, you name it. we have to see, but at least this chapter, let's face it, a very quick investigation when we are talking about an anti-monopoly investigation and an antitrust investigation. in the west, these investigations last years and you don't get those payments from companies, they fight it tooth and nail.

we are moving on from this, thanks a lot. he haidi: we do have some breaking news. and i cannot see him of japan winning the masters tournament, he becomes the first japanese man to take that major. also the first asian born champion, he won that masters tournament by one shot on sunday. the 29-year-old hails from the island of should coast who. he is a five-time champion on the pga tour. let's get to vonnie with the first word headlines. >> heidi, thank you. china has admitted the country's vaccines do not offer high protection rates. the company -- the country's top official says the government is continuing different methods.

china's vaccine makers haven't released trial date above brazilians have shown efficacy rate of 50%. covid-19 cases in a new daily record threatening to derail the plan to welcome back tourists. it brought total crazes to more than 31,000. meanwhile, philippines president relaxed the lockdown in the area. people are still required to stay-at-home but more businesses will be allowed to operate. brazils hospitals are struggling to cope with the crush of covid-19 vaccinations. the country reported more than 93,000 cases over the weekend. also more than 3600 deaths. also takes the total death toll to above 350,000 people.

they reiterated the opposition to lockdown in a video on saturday. u.k. will allow the reopening of nonessential shops, gyms on monday with restaurants allowed to offer outdoor dining. they have similar rules in other parts of britain. a mass vaccination effort has seen more than 60% of british adults getting at least one dose. global news 24 hours a day, on-air and on bloomberg quick take, powered by more than 2,700 journalists and analysts in more than 120 countries. i'm vonnie quinn. this is bloomberg. shery: still ahead, developed countries are rolling up vaccines more than two thousand times faster than the emerging markets. we will discuss the market impact. plus, consumption and focus when china reports first quarter gdp data this week. this is bloomberg. ♪

shery: i china data glitch will be the highlight of the past week ahead in asia. china's fourth-quarter gdp will probably show the fact -- of the fastest growth on record. trade figures are likely to show exports continuing to move. key data coming out of india. for more, we are joined by sean, our senior asian economist. always great having you with us. we are expecting the fastest growth on record but, at the same time, we have seen significant pressure for the economy. the charts of the bloomberg showing how consumption dropped for the fourth time in four decades last year. how much progress are we expecting to see in this quarter? >> we look at the consumption

figures, we will probably get a strong year. but, we saw underlying some kind of weakness. we had another wave of the coronavirus outbreak, we also have some restrictions on travel over the chinese new year. it is probably a bit weak in q1. it will be quite strong given that last year was the peak of the coronavirus. going forward, we think after this week of q1, we will see it pickup. as restrictions continue to ease and employment growth also grows. shery: the manufacturing side of things continuing to be as strong as we have seen in the past? >> absolutely. it will probably show another strong outcome. we have seen so weak demand in some sections of the growth economy. but, overall, there is a very strong bounce and work trade.

of course, that $1.9 trillion u.s. fiscal stimulus helped boost the chinese product demand. that will remain a key driver of growth. shery: it is always a double-edged sword, what does this mean for policymakers? >> still with the working plan, they are going to maintain an easy policy. it will be a little bit less of a stimulus that we saw last year. so, again, they're going to try to moderate making sure it remains in control. less on the fiscal side, that will be less on the structure as well. haidi: how concerned are you about an even pace of recovery and the vaccine rollout? this is as we are seeing record cases in places like india and a slower than expected rollout of the vaccine there as well? >> emerging markets are going to be important for the recovery. just to the extent of vaccines,

vaccines are extremely important to make sure we can ease restrictions. we don't have constraints on the health system. they are going to be important, we think there will be some economies that will continue to struggle to return back to pre-covid laterals. countries such as thailand, the philippines, because of course we are seeing these numbers, it will make it quite difficult to open up the world travel again to the extent we saw before covid. haidi: where does the inflation picture -- what does it look like for you in asia? >> we have already been seeing a pickup in the numbers. i need to put this into context, that is a comparison from a large vase last year, of course the processes have picked up. we have also seen some kinds of food processes well. so, while we do expect to trade

for the year as a whole, we have to remember in asia that can effectively contain inflation. that continues administration controls that we have in place. that means the demand for pleasures still the labor market side. shery: we have a few monetary policy decisions across asia. anything we should be watching out for? >> i think we have the status quo. not looking for any kind of change in the policy rates. that said, probably a little bit more now that inflationary rates have picked up given what we see in the economy. but, they will probably be saying they will be maintaining the accommodation. haidi: what about the impact of the u.s. dollar?

is farsi direction is going to be the second half of the year? -- as far as the direction is going to be the second half of the year? >> strong for the year, that is the fact that we do have stimulus coming through. very strong growth, very strong rebound in the u.s. economy. of course, we have been seeing that through in the bond yield as well. inflation, what does it mean for u.s. policy? we think actually, again, the fed themselves will be seeing through this, and they will could be concerned more about the labor market. haidi: always great to have you on. coming up next, microsoft's potential $16 million bet on ai and voice technology. an acquisition of a company that laid the groundwork for the series. this is bloomberg.

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shery: here's a quick check of the latest headlines. lg energy has settled there to avoid a 10 year input ban of the batteries into the u.s.. sg innovation has agreed to pay a one point $8 billion settlement. the agreement will save as many as 6000 jobs in georgia, as well as the rollout of foreign and electric vehicles. a chinese ride-hailer is said to have a u.s. ipo, which could value the company up to his much as a hundred billion dollars. goldman sachs and morgan stanley have an underwriter, also the card for a later time. they are backed by $1.5 billion

loan to shore up capital have the listing. travel loca reportedly going public in the coming months through blank check company is kickstarting a coming out party for southeast asia tech centers. they are set to unveil a listing at more than $34 billion. listing a $5 billion valuation, backed by billionaires richard lee and peter thiel. they are sent to be weighing a spac deal from jerry sloan. it could be worth about $20 billion, that was put in among the biggest back mergers today. that by bill gates private investment firm and biking global. a deal could come this month.

haidi: turning to a bloomberg scoop now, microsoft is said to be in advance talk to buy ai and speech technology nuance communications, which could potentially value that company at about $15 million. possibly, it would be its second biggest acquisition. why are they buying, why are they doing this now? what is the technology behind it? >> nuance technology laid the groundwork's for the design and integration of theory, which we all know, it's really good at speech recognition. this is all very attractive to microsoft. especially in the health care space, with a lot of big clients.

shery: what does this tell us about the m&a strategy? >> microsoft has done some of its biggest deals today, just few years ago it did the biggest deal ever, buying linkedin. he is really focused on expanding, on the flipside, he is interested in growing the xbox division of microsoft. so, microsoft has done a lot of deals in the videogame space. just a few months ago, the deal closed. they bought zenimax for 1.5 billion dollars. a video maker. there into videogame deals and enterprise technology. haidi: which is this mean for talks? >> the microsoft corporate

development team is very large and they are more than capable of doing several deals at once. so, we know that microsoft has had talks this quarter, bloomberg reported those talks can come to fruition later this month. we know for sure the nuance talks are more advanced. you could see a deal very soon later this week. definitely the focus right now on microsoft getting the nuance deal to the finish line and maybe there xbox division. a very much favored by gamers. that is more something that would expand into xbox division. shery: so, microsoft and nuance have been collaborating for a number of years now, right? so, why buy it now? >> that's a great question. nuance, rather -- under its ego

who joined in 2018, has been trying to slow down. they focused on automotive, so it is division of private equity. it has played itself up to make it more attractive. so, it is more of a pure play of artificial technology company focused on speech recognition. it has medical trends corruption software as well. so, the timing is right. because it was able to hive off different units over the past couple of years. nuance is a name to know for those following tech m&a, considered a busy seller in recent years. haidi: let's take a look at how we are setting up the start of trading in asia. this is the picture when it comes to the futures market in japan and australia. take a good look at how we are setting up this day ahead.

as jay powell reiterated that he is expecting this should be something of an inflection point for ongoing u.s. growth, feeling more positive about the growth prospects ahead. when it comes to trading a futures in chicago, we are seeing the upset about to tense of 1%. here in sydney, a level start to trading. taking a look at the start of the trading week in the u.s., a lack of volatility has really been in the markets, given that we have seen volatility in community or nation as well. take a look ahead in terms of what is going on and australia and over in new zealand, on the corporate front we are watching cba. reporting a potential buyer of the insurance units. also putting some high-profile shareholders against the companies at the annual shareholder meeting in london on friday. the big story, of course, the

prime minister, now abandoning his goal of having all residents vaccinated by the end of the year. we will get the details on that moving target and that disappearing target just ahead. this is bloomberg. ust ahead. this is bloomberg.

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shery: taking a look at the day ahead, into pound the governor of osaka words you may need to ask the central government to declare a state of emergency of current efforts to quell the coronavirus applico deemed insufficient. japan expanded restrictions to tokyo and kyoto met a surge in cases. on the corporate front, earnings today and we will see how equity markets move on the news. japan price index for march also due out in an hour. the consensus estimate was 4.5% yard your gross reversal from

the contraction last year. -- 4.5% year on year -- was for a 0.5% gross reversal from the contraction last year. meeting with joe biden and other chipmakers to discuss the ongoing chip shortage. also awaiting early numbers when it comes to the first 10 days of trade numbers for april, out later. exports jumping 17% year on year in march and we will see if that is the state. in the fixed income space, we do have the government selling three year bonds today. haidi: let's take a look at how we are setting up with the rest of the markets. sophie, what are you seeing? sophie: we saw the nikkei 225 cap small loss and out nikkei futures pointing to upside, as we gauge reaction to virus restriction tightening in tokyo.

in australia, the delay for vaccinations could pose headwinds to the aussie dollar this week according to cba but the bank does not see that downside and you expect the aussie dollar will reach 80 by the end of the quarter. on the terminal, they knock on effect from the alibaba antimonopoly find by china. -- fine. and making the move to a deal circulation economy. the question of the day on the mliv blog, how great is china's crackdown on global tech stocks? tencent could be next. it's market cap it was on one showing dollars with shares moving 180 billion since then. shery: the conversation around chinese tack following a record fine of two oh you dollars on alibaba. -- $2 billion on alibaba, fine.

david, alibaba can afford to pay the fine, right? not to mention it does left a certain amount -- it does lift a certain amount of uncertainty, right? >> i guess to answer that question, we did just get from bukhari -- mcquarrie, an analyst first out of the gate. we are coming from a to 18 actual price target and to put this -- 218 price target and the question of the day how much of an effect is this? when you look at the underperformance of alibaba at the first week of november, you know that hank sent index of the poll is for hunter points and that does not sound like a lot. but if -- a poll on the hang seng index was 400.

but if alibaba was not part of it it would be trading north 29,000 now. it does lift the cloud of uncertainty but does lift the same way for peers of alibaba who may also be caught in a similar situation now? yet to see come of course. haidi: talk about the number of the fine in the context of the size of alibaba here? >> it is a big number, to put it billion -- $2.8 billion. does it cause a significant dent in the company finances? it is a small price to pay, as shery was pointing out. you look at some of the context on your screens, 4% of cash on hand and total revenues for the 12 month ending march of last year and 10% of one year's operating cash flow.

i guess the point really being is, when you have regulatory scrutiny, concluding in this way. in a way you could look at it as regulators finally catching up to companies that have run substantially, like alibaba, to get to a certain skill that they can now afford to pay most in hindsight what penalties china has now associated. here's a breakdown of assets and liquidity for alibaba. it will remain ok. haidi: let's get you to vonnie quinn with first word headlines. vonnie: the biden administration is stepping up scrutiny of china's plans for a digital yuan. u.s. officials are concerned it could spark a long-term bid to topple the dollar is the world dominant reserve currency, and they want to know how it will be distributed and whether it could be used to script u.s. sanctions?

the pboc has tested the digital you want in select cities, putting it on track to be the first major center bank to issue a virtual currency. former u.k. prime minister david cameron has broken his silence over grainsill capital, his efforts to lobby for the collapse. top cabinet ministers came under fire for tampa need the company which voted last month. as a company advisor, cameron and lobbied to give greensill access to funds from britain's pandemic support program. jordan's king a bill of the second, and his half-brother made their first joint public appearance at the palace last week. marking a major public holiday with other members of the royal family, a first public appearance since he was placed under a form of house arrest amid accusations he was involved in it sedition plot to destabilize the kingdom. butters and could are are said to elect -- voters in ecuador are set to elect a new

president. the runoff is between a former leftist businessman slated to end. the current president is not seeking the election, and he imposed severe austerity measures as part of a financing agreement with imf. 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. i am vonnie quinn. this is bloomberg. shery: next, wealthy nations are vaccinating 25 times faster than their developing peers. we discussed the applications for markets. this is bloomberg. ♪

shery: the fed signaled the u.s. recovery is at a turning point, with stronger growth expected, but said the threat of covid-19 remains. the vice chair richard clarida says policy chairs are looking for hard numbers as whether their reaching goals before adjusting interest rates and he spoke exclusively to bloomberg. >> the federal reserve in august adopted a new framework, robust evolution. primarily it is outcome based. our goals are maximum employment and price stability. we want our policy to be robust if our models breakdown. we can still do monetary policy but we are going to be more outcome based and less outlook based. i think that has served us well

in the pandemic and it will serve us well in the years ahead. >> could you characterize that as a commitment to being late instead of being early? >> well, what we have said in september of last year following our framework announcement in august, is that we do not expect to lift off until three conditions are met. first, that inflation gets to 2%. we want to see actual inflation for at least one or two years at 2% and we want that to be sustained. secondly, we want to look at labor market indicators consistent with a fully employed economy. third, we want that to be sustained. we think that is appropriate since we have had the effect of lower bound. inflation has been below our target for most of the last 10 years and under those circumstances, that is a good policy. you are correct that in the past to the fed was more preemptive, and my research suggested if you have good models, you want to be preemptive. but if the models are not

serving you well, you're more robust if you're looking at actual data. that is the way i characterize it. >> the conversation as you know now is over what substantial progress actually as? you are familiar with the debate and we talk about it almost every day on programs like this. to think it is necessary to define what substantial progress actually is? >> first of all, it is actual progress and that is an important point. it is not projected progress. it is hard numbers on the labor number -- labor market and on prices. second, we are early on, in this year. i know that we have penciled in 6% or 7% roast and a big following on a planet. but under -- six or 76% or 7% growth and a big fall and unemployment. as we go to the or and data comes in and we release our sep projections, based on incoming data, we will have a sense on where we are relative to that progress. and chair powell also indicated

as we think we are making that progress we will commit a case -- we will communicate that to people who listen to arc medication. this is where we -- who listen to our commit occasion. this is actual progress, not projected progress. we will inform the public about our views on that progress. >> are you afraid of inflation? should we fear inflation? >> well, the reality is, we have a dual mandate. half of that is price stability. so, the federal reserve, every federal reserve since paul volcker's leadership, has been committed to that, as is the powell fed. but 2% as a ceiling, in effect the way many thought of our prior policy, it not serve the economy well. it has serious supplications for the labor market and prosperity. essentially what we have said is we want inflation outcomes that keep inflation expectations anchored at 2%, and that mean sometimes we will be above it and sometimes below.

we focus on inflation expectations intensely and have a new index of, inflation expectations. i would say, and we have indicated, that because of the nature of the pandemic shock one year ago, as we move through 2021 on a year-over-year basis, headline inflation is going to likely move above 2%, because we are going to be comparing this year's prices with last year's collapsing prices. but we expect in our baseline, most of that to be transitory, and for inflation to return later this year to around 2%. that is our baseline. let me also say around the baseline there are risks on both sides. and in the risk case in which inflation were to begin to move above a level consistent with price stability we would have the tools to address that, and i am confident we went under that risk scenario. haidi: that was the fed vice chair richard clarida speaking exclusively to bloomberg.

virus data revealing a bleak picture when it comes to e.m.'s including any at which not accounts for 1/5 of all cases globally. in addition, developing countries are also rolling out cobit shots at a slower pace --covid-19 shots at a slower pace. you can see the seven-day average of new cases topping 120,000. india sing a record number of new cases and recent days. i want to bring in the head of asia research at amz. this coupled with less access and a slower rollout of the coronavirus vaccine programs in places like india, does the set us up for a bifurcated state of recovery, in asia? >> i believe it does. the recovery nature is still entrenched, i am confident we will see a recovery in 2021. however, it is going to be uneven across the board.

it is going to very much depend on how these recent resurgence this in cases in india and the philippines and we are starting to see our fourth wave in south korea, it is important to see how these play out. we also know a vaccine rollout has been slow in emerging economies. and particularly in some parts of asia as well. that has the prospect of dealing some opening up and hence, resulting in a slower recovery that we initially anticipated. haidi: what about a risk of a more hawkish than expected fed? if chair powell is right and we are at an inflection point for growth and potentially inflation going forward, is also a double whammy that some of these asian em's will have to cope with rising rates and pressure on their currencies, as well?

>> this is a big risk going forward, that if we get a situation where, the u.s. economy significantly outperforms, and is in a position where the fed could contemplate normalizing while asia is still severely lagging behind, then yes, that will be a huge major headwind if that were to occur. however, that is not my baseline case. i am still of the view that the fed will be very patient. and that will allow an utterly the u.s. economy but the global economy as well, to come toward full normalization before they contemplate lifting rates. shery: we saw the korean won lady declines of the previous session, -- leading declines in the previous session with ppi nevers out of china. the bank of korea this week about what are they facing in terms of economic challenges? >> the current economy is actually recovering quite well, given by the -- driven by the

export sector. export numbers have been impressive. however, the do best economy is still somewhat weak and the labor market has not fully recovered. at the same time, the bank of korea is also worried about asset prices, particularly in housing. it is quite a challenging next. i think for the bank of korea, the safest path is to do nothing, and the rates as it is. after all, we are also facing, a potential shock wave of virus outbreaks. so it is still challenging for policymakers. but at least from an economic standpoint, the recovery is very much entrenched. however, it is primarily driven by the export sector. it is not really broadened out into other sectors at the state. shery: exactly, export sectors perhaps led by samsung. and there semiconductors, the gtv chart on the bloomberg showing, the valuation of the

kospi rising. so what is the outlook for the south korean market and the korean won, when that recovery seems to be so narrowly focused? >> it is narrowly focused at this stage, but ironically, it is the narrow focus of it, that i believe can help korea continue to do well. because of the tech heavy nature of the kospi, as long as those sectors continue to do well, we will see a return of portfolio inflows into korea, which should be very supportive of the koran -- korea won. we have seen in recent times the won has started to strengthen, as has the kospi. it also includes housing which has been moving up. this very uneven nature of the recovery, which is reflected also and as a prices, is an ongoing challenge for policymakers and south korea. shery: is at the same narrative we are seeing graphs in china as

well? with tech giants seeing the upside during the pandemic? what are we seeing in terms of the broader economy? >> well, china is slightly different. they have managed to contain the pandemic very, very well, for quite a long time now. and the vaccine rollout is starting to progress. and i think chinese authorities have a goal to at least having the majority of the population vaccinated toward the end of the year. so we are already starting to see chinese economy recovery auditing into the domestic demand, which is -- recovery broadening into domestic demand, which is different from other countries where it is lagging behind. one different from china and the other economies in the region is around tourism. china is not reliant at all on international tourism. whereas in asia, countries like thailand and singapore are. so as long as borders remain shut, those economies that are dependent on tourism, will not see a full-blown recovery.

whereas for china that does not really matter as much for them. shery: head of research asia, at anz. brazell hitting a for your high they've had to raise interest rates, the first hike in major economy. we have an exclusive conversation with the brazilian central bank president, who will join us to discuss the largest american economy and their interest rate path. that is on tuesday evening in new york, 6:30 a.m. wednesday in hong kong. this is bloomberg. ♪

shery: we have breaking news out of japan and are getting the producer price index for march. now coming in at growth of 1%, which is beating estimates and accelerating faster than expected. and this after contraction of 0.7% in the previous month, which was revised upward to 0.6% just now. so we are talking about the first increase in ppi numbers year on year, when it comes to that japan march producer price index. so, inflationary pressures appearing in the japanese economy. month on month growth of 0.8%

exceeding expectations. we did have a weaker yen and higher oil prices, feeding into inflationary pressures in japan. the likelihood for the next couple of months is that will continue given the low earlier base and strong demand from countries like the u.s. and china. take a look at south korea. we are getting export numbers out of south korea for the first 10 days of the month. gains of 24.8% year on year, chip exports rising 24.8%. when you average it out come of the daily average exports for the first 10 days, it is a gain of 32.6% and imports rising 14.8%. so we continue to see very strong gains for south korean exports, given the strong demand across the region.

let's stay in south korea and we will be watching shares of lg and sk innovation insole at the top of the hour, the two ev nattering makers set to end the better u.s. trade dispute. su keenan has the latest. the agreement averting an import ban on sk innovation and a tough situation for president biden. su: absolutely, and besides holding up manufacture for several automakers, the dispute have become a political conundrum. as many as 6000 battery manufacturing jobs in the politically important state of georgia are at stake. also, the agreement spared president biden from making a choice between is climate agenda and intellectual rights. the dispute was over battery trade secrets. the two companies released a joint statement saying they are not going to work together, quote, in particular they will work to strengthen the battery

network and environmentally from the policy the biden administration is pursuing. 1.8 billion sk innovation agreed to pay lg energysolutions, unit of lg chemistry, is divided between equity and royalties. the cash and royalties. the settlement also averts a tenure import ban of sk innovations'batteries in the u.s. and both companies have agreed to end or withdraw legal issues not only in the u.s. but between the companies in south korea and overseas. haidi: let's hear more about the impact broadly on the auto industry, and political ramifications? su: there are a lot of those. president biden did issue a statement saying the agreement as a quote win for american workers and the american auto industry. it is also a win, in particular

for ford and volkswagen, and both had roll out in vehicles that would have been impacted directly, had an agreement not been reached. ceos of both companies sent out statements applauding the agreement. the government -- the agreement also removes the headache i'm south korean and u.s. government officials, and both sides pressed for this agreement. biden was facing an april 11 deadline to decide whether to overturn the import ban, that had been imposed by the trump administration, or to do nothing and let it take affect. again, president biden and his administration, wants to promote the electric batteries and electric vehicles, as part of his climate change initiatives and supported the long-standing support for intellectual property rights. so this agreement allowed him to sidestep making a choice, and appears to be a big boon for the auto industry.

haidi: su keenan in new york. market opens in sydney, south korea, and tokyo, our next. this is bloomberg. ♪

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and texture, so they'll blend right in for a natural, effortless look. call in the next five minutes and when you buy 500 strands, you get 500 strands free. call right now. (upbeat music) shery: welcome to "bloomberg daybreak: asia." from bloomberg world headquarters in new york, i am shery ahn. haidi: asia's major markets have open for trade. a positive start to the week with fed chair jay powell lifting sentiment for flagging prospects for strong u.s. growth in hiring as covid-19 remains a threat. alibaba says thank you after

getting hit with a record fine. it comes with a series of forced changes but things could have been worse. two of south korea's biggest battery makers reach a deal over a bitter dispute, setting them up for gains, as trading begins in seoul. shery: seoul started trading and japan and australia. let's turn to sophie for a chuck of what to watch. sophie: we are seeing upside moves in japan, the nikkei 225 adding .3%. the yen staying below 110. it faces downside pressure on expectation for higher u.s. yields with the u.s. ten-year trading at 157 at the start of trade. a reaction to tighter virus restrictions in tokyo and the osaka opener saying there could be -- governors saying there could be a state of emergency, as the countries a vaccination program kicks off monday.

we are seeing upside when it comes to the march producer price numbers coming in better than expected on a yearly basis. in south korea, trade in the first 10 days of the month rising about 25% on export numbers with chips providing a use -- a boost. we are keeping an eye on chips ahead of a white house summit that is addressing the global chip shortage. at lt energy and sk innovation reach a settlement to end the battery showdown in the u.s. .3% higher after capping up again friday of 2%. the korean won trading at 1121 this morning. in australia, the open in sydney, slight downside for asx 200 this morning and the aussie dollar slightly under pressure. headwinds from the delayed vaccine rollout. and we are seeing the aussie curve steepening as supply at

pressures are seen weighing on the tenure ahead of tuesday's 2023 syndicated bond yield anticipated. taking a look on the terminal to see where we stand so far your to date when it comes to asian stock performance, compared to the u.s. and europe. we are seeing the apac index in white lagging benchmarks in the u.s. and europe. a lot of that coming from the downside moves we are seeing for chinese shares, off nearly 13% from the peak we saw back in february. concerns over tightening liquidity as well as the shift by authorities in the mainland toward curbing financial risk. and the antimonopoly probe on alibaba as well. haidi: joining us, the head of asia trading strategy from citigroup global markets. where are the opportunities ucf the moment as we continue to --

where the opportunities that you see at the moment in this low volatility environment here in the u.s. and in asia? >> we are concerned about the u.s. market and what we have seen in the last two weeks is being, the market rallying on very little volumes. rsi now at 72 and it is a place from which are models say there could be a correction emerging. what has actually happened is that at the end of march, there was a very big injection of liquidity by the ecb through tltro program, something like -- gltro program and billions of euros came into the market in one week and that supercharged performance. but we think it is time for a pause, in the u.s. and markets like europe and korea and taiwan. and looking again at markets like asia and emerging markets,

and into hong kong tech shares, and looking to buy the into the dip. haidi: speaking of china particular going to the lows we are seeing and china. we saw the huge fine imposed on alibaba. the company thinking regulators. -- thanking regulators. is this a sign for chinese tech giants, from regulators? >> it is interesting because our stance till now had been bearish on the china tech names, and bearish on china a-shares as well. but we thought would happen as you would go down to somewhere at a level around the 200 day moving average. the view at the moment is that the state fund should step in and be supporting markets, that

is what happened in previous occasions. but if there is, -- there's a lot of macro data coming out later this week, if that shows an acceleration growth and the potential for more tightening, there is a potential to break those previous lows and move down a further 12% from here. so we are looking at some thing like 4444 on the csi 300, and at that level we think the pboc will completely change its tune, in terms of tightening. you may start getting remedy -- rmb weakness emerging at the point is well, and instead of moving 20 tightening bias, which they are currently and, -- instead of moving toward a tightening bias which they are currently in, you may see [-] because they do not want the equity selloff to go down. at those levels you give up all

the gains since china came out of the coronavirus crisis at the beginning of july. and i don't think they want that because retell margin levels are still very elevated. shery: so to your point, this gtv chart on the bloomberg showing outflows we have from the chinese markets in recent months. what will all of due to the chinese yuan, after we saw that strength during the pandemic? >> i think it is going to be, if you look at the way the virus is shifting, the u.s. is moving very quickly toward immunizing its population with a virus -- with a vaccine that works. in china, yes, the vaccines are there. but even the chinese authorities themselves are saying, while they are not that effective. and if you look at countries like chile, pakistan, number of other countries which have taken

some of these chinese vaccines, we are finding yes, vaccinations are happening. but the number of cases are coming again, because it is like tossing a coin if you have a vaccine which is only 50% effective. even if you vaccinate everyone, you're only immunizing half the population, and to get to herd immunity confidently, you need to do it three times before you get to that level. from the perspective, the probability of a further locked out in the u.s. seems lower because those vaccines are 95% effective. i think china, not a lot of completely, but there potentially could be sporadic outbreaks. now we are starting to see potentially rose more in the u.s. than in china. so the dollar-rmb looks like it has turned a corner here.

shery: any opportunities in the chinese bond market where analysts have been looking closely, but at the same time we have had anxiety over china just last week as well. >> that will be clearly of focus because the restructuring in the news is going to be ongoing, until the and of this month. when i speak to my credit colleagues, this is the only thing they are focused on. they do not really think this is going to lead to widespread systemic problems. that said, there's a lot of money waiting on the sidelines. but there is not so much of a reason to go in there and buy bonds of state owned companies, and some of the tech names, so i think it is very much a wait and see. people are waiting to see if the situation clears up. at this moment we do not think this will be systemic.

but we think if there is a wobble in the credit market, and it bleeds through to the equity market, then, clearly, that would be a very good reason for the pboc to put its tightening policy slightly on hold, and talk a little bit more dovishl y. that might provide support to equity markets. the equity market is interestingly poised and a break of the 200 day will unleash a lot of retail selling. that will then have impacts on the fx and on the bond markets as well. haidi: of course we are keenly awaiting the key number of china ddp coming out this week. at a slew of data. take a look at this chart, put a great indication of how distorted base effects can make these numbers, right? we are looking at a potential projection signaling almost 20% year on year in the first quarter economic expansion.

if you left under the hood, what are you looking for? and what will prompt the market to believe in more policy tightening? >> well, i think another problem at the moment especially for the last three months is really going to be this volatility in the data. and, you know, there's going to be a lot of base effects happening. and it is going to be quite difficult to actually read through what we are going to see. i think the concern at the moment, especially from the ppi data we saw from china on friday, is that inflation is coming back, not just in the u.s. where the fed is continuing to assure us that inflation is going to be transient, but it is also showing up in the numbers in china, as well. it may be that the market starts getting more concerned. one thing we are looking at is, if you get an inflation for may

in the u.s. around 3%, yes, you believe the fed's argument that inflation is transitory. but you have to start pricing in a small probability at least, that perhaps it is not. and i think my view is that it is transitory. but i think the market will become a little bit concerned that if you're going to 3%, how much hard you go? my view is you go to 3% drop off in the third quarter. but then in the fourth quarter again, what we are seeing is, another rise in inflation. and it is not going to be up to about 3% but certainly in the height to percent, and again -- high 2's. and again, we are like to be above the fed target for most of this year so i think those things are going to be a concern for a lot of those areas. and if you do get that selloff in bonds, and i think radical to

a level around one put some 5%. -- i think we are at a critical level around 1.75%, that will be important, and for japanese equities as well. shery: the head of asia trading strategy from citigroup global markets. and aleut -- an alert on the bloomberg, sk innovations seeing its best day in three months and lg chem singh is best in one month. -- seeing its best day in one month. the two companies a $1 billion settlement to end the ev battery spat. the biden administration promoted this deal to keep georgia jobs that were at stake. the settlement is ending into your legal dispute over trade secrets, and now both stocks soaring at the moment. sk innovations seeing double-digit gains, the best day for the stock and three months. we also give giving and i on this call with alibaba. it's ceo now on a conference call saying that they do not

expect negative impacts from the changes. beijing slapped a record $2.8 billion fine on alibaba, after antimonopoly probe. alibaba saying the more mature services will be free and do more to help martin's reduce operating costs -- help pertinents dust to help merchants -- they will do more to help merchants reduce operant costs. again, a record $2.8 billion fine on alibaba after that antimonopoly probe. let's get to vonnie quinn with first word headlines. vonnie: the u.s. secretary of state warned china against encroaching on taiwan. in an interview with nbc news, antony blinken voice concerns about beijing's aggressive actions in the taiwan strait thomas same the u.s. stands by its commitment to ensure the

island's defense. this comes after the state apartment these limits on unofficial contacts with taiwan. iran is calling a black up at its biggest iranian -- uranium and richmond facility to -- enrichment facility. the top atomic official did not elaborate. israel opposes the 2015 nuclear deal and does not want the u.s. to lift sanctions on tehran. brazil's hospitals are struggling to cope with a crush of covid-19 patients as the nation gets hit by more contagious variant. the country reported 93,000 cases in 24 hours over the weekend and saw 3600 deaths, which takes the total death toll above 350,000. health officials were the upper exotic critical stage. the president, bolsonaro,

reiterated his oppositions to lockdowns in a video on saturday. thailand's covid-19 cases at a record threatening to the realm of upland of the nation to welcome back tourists. health officials say delhi infection serve to 789, bringing tote -- say that total daily cases surged to789. a locked out in the manila area relaxed, and more businesses will be allowed to operate the people still have to stay home. 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. ♪ haidi: still ahead, as the virus continues to threaten the olympics this year, the 2022 event in china is facing more boycott calls. we discuss it with the chief olympic marketing officer, next. and why china's record fine may

actually be a small price to pay, details next. this is bloomberg. ♪

shery: the ceo of alibaba daniel jang hold a conference call now, saying he does not expect a negative impact from changes required by regulators. alibaba what slapped with a record $2.8 billion fine, after antimonopoly probe. he is saying they're reserving billions to support new initiatives. he seems to be very focused on this environment for merchants? >> absolutely. the ruling from regulator saturday morning is that they want to break the practice that alibaba was conducting, forcing merchants to choose between alibaba or other e-commerce platforms.

pre-much forcing many merchants to use alibaba, which has the biggest skill in china. the comments coming from the ceo on this conference call which started at this top of the hour and going now for 20 hours, also with the cfo. on crossing, alibaba singh regulators have an inquiry on m&a, as part of this -- alibaba is saying that regular's happening cory on m&a as part of this review. so, number -- that regulators have an inquiry on m&a as part of this review. he is saying alibaba will do more to help merchants reduce operating costs and more mature services will be free going forward. and they will invest more to improve merchant training. obviously, regulators have been quite concerned about these practices that alibaba was using to squelch competition, and

forcing merchants to choose the alibaba platform. also, new headline, alibaba is not aware of other investigations on antimonopoly law. that is the big question going forward. now that we have had, what seems to be a wrap up of a four month long antimonopoly and antitrust investigation, are there other measures coming down the pike? because, as part of this review and part of this fine, 2.8 dollars -- $2.8 billion usd, there are rectification's as well, that they must do. these include abandoning the practice of forcing merchants to choose a particular platform, such as alibaba. keep in mind this could have been much worse than this fine, 4% of 2019 to domestic sales, to put a billion dollars usd. that -- $2.8 billion usd. that could have been too -- that

could have been 10% of domestic sales. keep in mind they have not been forced to the best assets and have not been broken up. all those options could have been on the table, and were likely considered. haidi: it is going to be key for investors, saying now they are not aware of any other issues around the anti-monopoly law. steve, there is a worst-case scenario because alibaba may be compared, and its competitors have a bigger and broader business. they talk a lot about the synergies in the cross assets of their business. could there be potential there for clampdown? >> there could be. again, much of the growth of these platform such as alibaba and tencent, have gone pretty much unregulated -- i do not want to say unread letter because that essay get 30's were not necessarily keep an eye -- i do not want to say unregulated

because that means authorities were not this early could be a not but there was not a regulatory framework to keep an eye on this expansion. including m&a and venturing into other areas such as fintech, mi crolending, and the like. now authorities are putting in place a regulatory framework, so they can be held accountable. this really is antitrust, and antimonopoly billing for alibaba. this is not about the 33% owned fintech affiliate, ant. we know the big hullabaloo when the ant ipo was scuttled at the last minute walking way from the $35 billion joint ipo listing in hong kong. that is the risk to the financial system. and the competition risk posed to state-owned banks, through the micro lending platforms, and

other areas that provide risk to the chinese financial system. that we do not know the outcome. bloomberg news reported those assets could be put under, you know, oversight by the pboc, in a holding company. we have at similar news come out about tencent. it stayed up all be folded into, along with alibaba data and and data, could be -- and ant data could be folded into a new company with joint oversight by the government of china. what is going to happen to the fintech arms of these platforms and what is going to happen to the data? we do not know when it is not over. this is the first salvo. haidi: we continue to bring you the latest out of the alibaba conference call, the company saying they're unaware of other probes around the antimonopoly law after that huge fine. plenty more to come on "bloomberg daybreak: asia." this is bloomberg. ♪

haidi: a quick check of business flash headlines. authorities say boeing needs to inspect hundreds of 737 max jets for flaws and logical power systems. planes built since 2019 could require repairs. most are in storage but 90 are currently in commercial operation. another two companies reportedly going public through blank tech companies. one said to unveil a listing valued at $34 billion. an indonesian firm will follow suit with a $5 billion valuation, and a blank check company backed by billionaires ritually and peter thiel. the rideshare company filed confidentially for u.s. ipo which can value the company at up to $100 billion with goldman

sachs and morgan stanley tapped as underwriters and ado listing in hong kong at a later time. shery: border, including analysis on the record fine for -- more to come including analysis on the record fine for alibaba. this is bloomberg. ♪

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shery: breaking news right now. we continue to hear from the ceo of alibaba who continues to speak during a conference call. he is saying it is not just about alibaba. large tech companies globally will face scrutiny and data regulation is a global trend according to him. they are focused on privacy and protections and that alibaba will work with regulators to focus on collections. what have we heard from analysts

so far about this weekend's developments especially given the record $2.8 billion fine? david: we have heard from our guys at bloomberg intelligent saying this is a small fine and a small price to pay to remove the uncertainty. and reflecting that they are essentially happy to put this behind them. the other we heard which reinforced their rating on the stock. about $100 north of where the stock price is at the moment. and to put it into a larger context, there are stories on the bluebird terminal about how china is weighing on asian equities and how asian equities

have underperformed what we are seeing in the u.s. and a large part of that is because of how tech weighs in china. we did get confirmation that the ant ipo has been pulled. but also uncertainty surrounding these large caps, looking ahead to quarter two. haidi: in terms of the $2.8 billion, alibaba singh and the conference call that it will be reflected in the march quarter. talk to me about the number, the fine in the context of the numbers we are used to seeing with this company. david: it is good to remind our viewers that we are basing a lot of the context here on financial

statements that ended march of last year. free cash flow is about 10% for the 12 months -- 4% of total revenue. also about 4% of the cash in hand. it is almost certainly going to be a taxable hit because it is a fine. if they do take it from cash which was 70 billion as of the end of december, that takes us to the next graphic. liquidity ratios. that takes it down a little bit to just over 1.2.

markets over in a little more than an hour. chances are that it will be seen as a sigh of relief. haidi: as we wait that reaction in china markets. let's see how markets are already trading pure steady as she goes. to start the week. sophie: somewhat steady. a mixed picture in terms of asian stocks. the question this morning following the fine to alibaba is what will be the effects? large tech companies according to alibaba will experience more scrutiny. and when it comes to stock movers, focusing on one company after some rerate things on its earnings.

they slowdown in the second half. as k innovation jumping as much as 18% after reaching a settlement with lg generally on the eeev battery issue in the united states. morgan stanley has raised the stock to overweight given. [indiscernible] and ahead of the open in hong kong, i want to illustrate how we have seen -- ending on a

weaker note. bloomberg intelligence pointing out that selling is partly offset by the purchase of a company. [indiscernible] also anticipating china's policy may help. shery: let's turn to the first word headlines with vonnie quinn. vonnie: the u.s. secretary of state has worn china against encroaching on taiwan. in an interview with nbc news, antony blinken voiced concerns about beijing. saying the u.s. stands by its commitments to ensure the islands defense. his comments come after the state department --. the biden administration is said

to be stepping up scrutiny of chinese -- china's plans. u.s. officials are concerned it could spark a long-term bid to topple the dollar as the world's dominating currency. the pboc has put it on track to be the first major central bank to issue a virtual currency. former u.k. prime minister david cameron has broken his silence defending his efforts to lobby -- cab -- cameron and top cabinet ministers came under fire last month. cameron lobbied officials to give greensill access to funds. japan has just made golfing history. the first japanese born winner of the tournament.

he earns the coveted green jacket by finishing 10 under par. american players came in the second and third spots. 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: dallas fed president bob kaplan says he is worried investors are taking on risk as the fed continues to stimulate the economy. speaking to bloomberg's kathleen hays, he said it was too soon to pull back support as a threat of covid continued. >> we will be less preemptive at the fed then we have been in the past and even on asset purchases, until it is clear to me that we have emerged from this virus and weathered it, i'm not going to want to be preemptive in talking about asset purchases. having said that, i don't want to go to the other extreme of

being reactive either. i think a combination of forecast and seeing actual results is probably the balance i will find. once it is clear to me that we have weathered the virus, i'm going to, i personally am going to want to error on the side of starting to remove some of these extraordinary actions sooner rather than later and why? because i am worried they are creating, if we do them longer than we need to, they are creating excesses and imbalances. excess risk in markets which are benign going through it but when things got back to normal and people need to de-risk, that can create a severe tightening and if you are to reactive through the process, it could have the effect of shortening the business cycle. that is at the other extreme and creating a severe slowdown in order to get out from behind the curve. there is no textbook for this.

you don't want to be to preemptive but i also don't want to be so reactive that we are late. >> another thing that officials are stressing right now, for example, on bloomberg television today someone talked about the jobs report. there is still a big hole in the jobs market. you have 6 trillion almost of stimulus passed in the last year appeared a record amount in modern peacetime history. his that view of the fed perhaps maybe needing to be eased a little bit. once the labor market starts building up, does the fed's position have to adjust to that? >> subject to me being convinced

that we have broken the back of the virus which again, i do not think we are there yet. once i feel that way, be personally, i would rather be on our front foot because i think excessive accommodation for longer than we need to has side effects and you do not feel them while they are going on. they are easier to see in hindsight. i would rather move sooner rather than later and i think we will be far healthier for it. but again, subject to me being clear that we have weathered the virus. that is the thing giving me pause right here and having me hold my fire. >> what is the biggest risk of not being on your front foot? >> the issue is -- we are watching inflation, for example. we know there is going to be a

price surge this year. we are seeing it already. the year over your numbers will be attention-getting because they will be elevated. i think some of that is going to be transitory. supply chains, the semiconductor issue. it is going to get worked out. it may take 18 months. but we are also going to have a tightening labor force and some of it may not be transitory. i will be monitoring that very carefully and looking at access risk taking in the financial markets and both of those for me, if you let them go too far, we have some tools to deal with them but again, employing them too late can cause, on the other hand, dealing with severe tightening which could cause -- haidi: 102 days and counting to

the tokyo games. we speak to syracuse university's rick burton about the business and policy of the olympics. ♪

haidi: he later went back on

these comments in an interview. officials are considering ways to boost efficacy. let's bring out our reporter, michelle cortez. how effective are the vaccines we have? should people take them if they are offered? in developing countries, they may be the only choice. >> that is a great point. in some situations, this is the only choice. the question is, is it better than nothing? and the answer is yes. what we are seeing is a 50% efficacy rate. reducing the risk of getting an infection by 50%. more importantly, it is more effective when we are talking about preventing a more severe disease. we are talking in the 80% range for a moderate infection.

and 100% of effective for severe disease. the answer is yes, if you have access to a vaccine, you should get them. some folks in china are talking about making vaccines more effective or potent. but if that is all you have got, take edge. shery: china is considering mixing vaccines to increase efficacy. say you get the chinese vaccine because it is available and a few months later, you have another vaccine available. can you upgrade in a way? do we have an understanding of what that will take? >> that is a great point. an upgrade. we do not have good data on this. there are studies happening right now when it comes to doing things like giving a third dose

of a vaccine or mixing of vaccines. maybe you get a chinese vaccine first and then get another after that. they are studying second generation mrna vaccines. the point is that getting a vaccine now is not like you will get a toxic level of the vaccine. if you get one, you cannot get another one. we got flu shots every year. some people getting the vaccine have not gotten an infection. shery: it is so interesting that you are telling us that. we will keep watching what to do

as more people are needing to decide which vaccine to take. let's stay with china. there has been plenty of talk lately of a boy talk of the beijing olympics over human rights abuses. the american secretary of saying the u.s. is not there yet. joining us now to discuss this is rick burton from syracuse university. great to have you with us. given the historical affect of what has happened in the past, what are you expecting washington to do? rick: i am not expecting them to boycott these games. i think joe biden is someone who appreciates the importance of the olympics and he loves sports in much the same way that john howard when he was prime minister of australia loved sports. i think we still have a bitter

taste in our mouths as a country for having boycotted the games in 1980. i would be very surprised if it happened in 2022. haidi: we still continue to have these talks and debates. there are more activists pressuring sponsors who dropped the beijing olympics. what will all of this controversy due to sponsorship and what it means for the olympics in 2022? rick: controversy is not unknown to the ioc. almost every games they have staged have been met with protests. and in the -- and they are in the era of the day. i think the ioc and the national olympic committees of the various countries involved have really learned how to work through this political minefield. it is never comfortable but it is something they have all come

to expect and understand. shery: does this continue to be a viable risk to be taken by sponsors? rick: i think so. i think they know there are very few sports properties in the world that reach as many countries as the olympics do good when i was the chief marketing officer for the u.s. committee, i think we had 205 countries that marched in the opening ceremonies. and the games at that time were seen by somewhere in the vicinity of 4 billion people that saw some portion of the olympics. when you are sponsoring and can have that kind of involvement of the world, that sponsorship becomes pretty relevant.

haidi: of course, we are just over 100 days out from tokyo. we continue to see japan struggled to get a lid on the virus. given that there are no foreign visitors and given the huge amount of controversy and drum up into whether or not these games will go ahead, has the shine been taken off the olympics brand somewhat? rick: that is a great question but i am not convinced that it has. some people might say that but i believe the olympics are so special. they date back to 776 bc these have been a part of the world for so many years and that is an understatement. these games manage to go on and thrill us because of the things that happen. we see world records. we see the world's best athletes. not just one country's athletes.

and even with the world cup in football, you really only see a handful of countries there. these are games that unite the world. and i think that is the ioc's mission. they are seen as aps organization that spreads a goodwill of sort across the world. shery: why couldn't the ioc delay another year given that you have to put so many restrictions on the games this year and public sentiment across japan does not seem to be too favorable? rick: you start to back up into other games. you have beijing in 2022 and paris in 2024. you have a lot of investors looking to get their money back out, a return on investment. i think the challenge for the ioc is that they have already been postponed once. they do not want these games canceled in any way and i think

they are willing to do almost anything to try to stage these games because a cancellation will be ruinous for a lot of countries and companies. haidi: syracuse university's professor of sports management. rick burton, great to have you with us. be sure to tune in to bloomberg radio for more breaking news. listen in by the app. there is a lot more ahead on daybreak: asia. this is bloomberg. ♪

haidi: we are just minutes away from the open of markets across china. given that record fine on alibaba, tech will be a focus. sophie: tencent may be next when it comes to regulatory scrutiny in the hot seat. alibaba is very much on watch. the stock target price at 3.59 hong kong dollars. in china, several agencies -- [indiscernible] industrial names.

tightening market controls and commodities. switching the board. looking at futures. looking also at taiwan. chips are very much in focus. watching for tsmc ahead of the investor meeting. when it comes to other themes, keep an eye on how capital inflows have been faring towards china. we see that moderate. haidi: on the next hour, here on bloomberg tv, we are joined by a guest from singapore. and reaction to the alibaba fine.

that is it for daybreak: asia. coverage continues with the start of trading in china. this is bloomberg. ♪

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golo helps with insulin resistance, getting rid of sugar cravings, helps control stress and emotional eating and losing weight. go to golo.com and see how golo can change your life. that's golo.com. ♪ >> good morning. it is not :00 a.m. in beijing and shanghai. i'm tom mackenzie. david: i'm david ingles in hong kong. let's get tears -- to your top stories today. alibaba thinking regulators in china after it was hit with a record antitrust to find tiered