>> good morning. we are counting down to asia's major market opens. shery: welcome to daybreak asia. our top stories, more paying -- more pain for bitcoin, elon musk implying that tesla may sell its holdings in the cryptocurrency. singapore and taiwan under new restrictions in a desperate

battle to prevent the spread of covid variants, and a bloomberg exclusive, we go inside a solar factory in china, trying to reassure the world it is not involved in forced labor. let's see how we are setting up for the market open. >> looking to see those markets shake up that downside pressure with asia stocks set to start the week on a front foot this monday. we are keeping an eye on crypto-related plays after bitcoin fell below 45,000 on elon musk's reports -- remarks. iron ore and copper falling. we are seeing oil prices gain ground early in the asian session.

an uneven demand recovery, that remains a big focus as we saw indian oil demand continue to shrink this month. we have china's activity data dump this monday. flipping the page, ahead of singapore's exports data, the dollar holding bosses after the biggest weekly drop in two months and a stock futures notching -- nudging higher. the government imposed new virus curbs. paul: singapore, the city state along with taiwan has been seen as a model of success when it comes to containing covid-19. also dealing with flareups enforced lockdowns which could spread -- which could threaten

their economies. let's get more. what we know about these flareups and what are the new restrictions? >> to put it into perspective, the last time singapore had a lockdown was a year ago. it shows how difficult it is to stay virus-free. over the weekend, we had more than 50 cases. that is causing a lot of concern. some of those cases are not related to any cluster and that is the biggest worry for the singapore government. what is happening now is no dining in will be allowed. groups are limited to two. work from home will be the default. what is different this time is that the mutations are infecting younger people and that is causing a lot of concern among the leadership here and that is also leading to the closure of schools for the next one month. it will be remote learning for the moment.

what is interesting as well is singapore will be vaccinating those under 16, it is looking at doing that once it gets the clearance to do that. this is a tweak in strategy. it was affecting older people but with the recent infections among those in schools, it is changing its strategy. -- it is holding off the second shot for those given the first one so that more people can be given the first shot. it is trying to perhaps protect more of its population. so far, about one third of the people in singapore have been vaccinated. a lot of implications. singapore is poised to host a dialogue next month. it is poised to hold the world economic forum. a lot of questions whether these events will take place, given the recent infections.

shery: taiwan has not any -- has not had any fall lockdowns as of yet. could that change? haslinda: that could. we saw 206 new local cases, the government is urging people to take precautions, urging companies to allow workers to work from home. if the level of infections continues to average about 100 or more for 14 days, taiwan could impose that lockdown that we saw before. it is try to avert that. there has been concerns, there has been some panic. in particular, the type it dropped 8% last week. some are saying it will drop further this week. we will see how it goes. it has put a lid on those infection numbers. shery: first word headlines.

>> thank you. the united states has joined other world powers and calling for an end to the violence in israel and the gaza strip. the secretary of state spoke with his saudi and egyptian counterparts but president biden also reaffirmed israel's right to defend itself. benjamin netanyahu says the military action will continue as israel doubles down on response from militant groups. a media tycoon and veteran actress and eight others will plead guilty in a trial such to begin monday as hong kong authorities continue to prosecute pro-democracy figures. in an interview, one said the group will plead guilty to attending an unauthorized assembly. his assets have been frozen and he has been sentenced to 14 months in jail. china's security regulator says

it is probing market manipulation after suspicious moves in the stock prices of several companies. the announcement follows reports alleging violation into equities markets. the regulator says is investigating violations of safety five cases. and yet is bracing for a cyclone to hit its western coast tuesday, forcing authority to begin evacuations in parts of the country that are overwhelmed by the second wave of the virus. it is expected to make landfall with wind speeds touching 175 kilometers per hour. india's prime minister told officials to ensure that essential services, including water and power, are turned on. global news, 24 hours a day, powered by 2700 journalists and analysts in more than 120 countries. this is bloomberg.

paul: still to come, the market outlook with sanders morris harris, we discussed whether they accumulate cash. was, the return of short selling. this is bloomberg.

shery: breaking news on microsoft and bill gates, the dow jones reporting that microsoft board members decided that bill gates needs to step down from his board in 2020 as an investigation into prior

romantic relationships that he had with a female employee a that was deemed inappropriate. this according to people familiar with the matter, talking to the dow jones. members of the board hired a law firm to conduct investigation in 2019. this after a microsoft engineer alleged she had a relationship over years with mr. gates. some board members decided it was no longer suitable for mr. gates to sit as a director at microsoft and mr. gates resigned before the investigation was completed. this according to a report by the dow jones. the latest on bill gates and the reasons he left the board at microsoft. let's turn to another billionaire, elon musk, because bitcoin got whipsawed after mr. musk applied -- implied that test that may sell the rest of its bitcoin holdings and while swings and or currencies may put

off some traditional investors, our next guest says they are attractive as a small part of any but folio. george ball joins us from houston. thank you for joining us today. is this an idea to hedge, given the incredible monetary easing we are seeing around the world, dollar weakness as well? george: i have said for about a year that the enormous pending in the u.s. is becoming greater now into the $6 trillion area, it is not going to be paid for by higher taxes. it is going to, in large part, be paid for by debasing the currency. it is easier for congress to simply say we will run the printing presses and that will

create the value of the dollar, hence, for many people, perhaps most people, having some portion of their assets held in cryptocurrencies is probably a conservative idea. now, the bitcoin and other cryptocurrencies will be very volatile over the short term. if a billionaire can break the value by 7%, you can see how volatile it is. longer-term, there is a serious reason for owning bitcoin and other cryptocurrencies, i think. shery: what about other new tech stocks? we have seen this theme about these tech stocks, especially during the pandemic, a rotation out of it towards cyclicals. are those still worth owning? george: for the time being, i think it would be a good idea to own but i would call the new tech stocks. the faangs are tired, they are

very profitable, valuations are very extended, i think it is time to rotate out of them. some of that has begun. owning other new tech stocks like square or teladoc or a cyber currency etf's, for the time being, still speculatively upward bias market, a good idea and a sound idea, i think. paul: if an investor has concerns over currency debasement and inflation, what about gold as a head? why is gold uncool at the moment? george: gold is so yesterday. gold dates back to even earlier than my beginnings on wall street. and more seriously, i think gold, silver will do well if there is a debasement risk.

probably the speculate of money, younger people's money, and institutional money will pool into the bitcoins, the coinbase is, into the urethras and other cyber currency more than gold. i think cyber currencies -- gold will do well, silver will do well. if the dollar is degraded in value. paul: in terms of inflation, there was the debate about is a transitory, is it and during -- enduring. george: i could hardly bind the two hands of wall street, on one hand, on the other hand, i won't be ready inflation is a real risk -- i won't. inflation is a real risk. it could and chris -- it could

increase very markedly six months from now. the fed can hold interest rates down, but the fed cannot stop inflation. as you get into mid 2022, there has to be a sustained and significant rise in prices which will shock, i think, most people who have not seen it since the 1980's. paul: all right, george ball, thank you for joining us today. let's get you across some breaking news at the moment, relating to the gaming stop -- stock crown, saying that blackstone takeover bid undervalues the company. its proposal from its rival is to take over crown. an update on the acquisition proposal from blackstone, crown resort to saying that takeover bid does undervalue the company.

we have local media reporting that shareholders are making growing calls to ground -- crown to start a formal process to get it around those regulatory difficulties, that it has been having. still to come, china's solar industry taking fire for its labor practices. we had exclusive access to daqo. details ahead. this is bloomberg. ♪

paul: china's solar industry is facing scrutiny after allegations of forced labor. beijing has denied the claims. as potential sanctions loom, one of the biggest factories has

broken ranks and let journalists inside to reassure anxious investors. our china correspondent reports from there. >> in most other parts of the world, factory visits like this are routine. not here. a region of china with a government has been accused of numerous human rights abuses against the muslim population, including forced labor in its solar industry. china denies the claims. now, one of the biggest solar companies, daqo, is betting on greater transparency. daqo itself has not been directly linked to the labor program. this is the first solar factory to open its doors to foreign media since the allegations of forced labor in the sector surfaced. behind me, you can see the poly silicone material that will end

up in solar panels all over the world. business has never been better at daqo. demand for the company's products is so strong, its factories are running at full capacity and profit margins are above 50%. but the stock prices lagged with its massive plant in a region now synonymous with abuse allegations, the company risks being tainted by association. that has left it in the geopolitical hotseat and its faux trying to reassure investors. >> it has an impact on our share price. tom: daqo is lining up auditors to vent its operations. executives hope an independent assessment will help insulate the firm from u.s. sanctions on the xinjiang solar industry, and outcome they now see as likely. >> we have not ever participated

in any of the labor. tom: would you have or, if the government was to ask you and say, you need to be part of this program? >> we are a foreign-invented -- invested enterprise a we are not obligated to follow the government orders unless we want to and i would say morally and pitifully, we are high on integrity. if the government did ask us, we would not participate. tom: selecting auditors is just a first step. getting them into china and securing access to key facilities could be challenging given the closed nature of this region. what is clear is this issue is not going away anytime soon. shery:, joins us now from beijing -- tom joings us now from beijing.

what was the atmosphere like? tom: there is a heavy police presence around the region, particularly when you are a journalist, you are monitored closely. this is a part of the world where they do as an parliamentarians in canada and the u.k. are keys chinese officials of committing genocide against that muslim minority, forced sterilization, forced labor. there is a tension in the region, certainly. daqo, the business featured in this story, has not been linked to those issues and has not been linked to forced labor, but they have been impacted and overshadowed by what is going on and by the scrutiny on the region. they asked if local government for permission to invite us in and they hope that this additional transparency along with an auditing process and maybe even getting a human rights organization in to monitor their business and supply chains, they hope that

will alleviate some of these concerns. paul: how much of a gamble is this push for greater transparency? tom: we talk about them breaking ranks with the rest of the sector in the region. they are one of four main polysilicon suppliers based in xinjiang, the other three had been linked to this issue of forced labor. china denies that this is an issue. they describe it as a lie. but daqo breaking ranks with the other three and going through this process does risk validating claims made by researchers and experts that beijing pushes back very firmly against. the other risk is that they are situated in a town and city that is overseen and managed by a government organization that itself has been sanctioned by the united states for building internment camps that the united nations says more than upwards

of a million people were held at one point. the risks are there. they are looking to expand capacity in later years in provinces where they do not face these issues. they are hoping that by getting auditors in and going through this process and this opening of doors that they will be able to apply for an exception to any sanctions that they see coming down the road from the united states. they think the u.s. is likely to sanction china solar industry as a result of these forced labor claims. paul: tom mackenzie there in beijing. quick check of the latest business flash headlines. a delivery e-commerce giant is seeking to raise $3.4 billion in its hong kong initial public offering. the company is offering six to 9.2 million shares -- 69.

2million sharie -- 6.92 million shares. a company one arbitration against india last year. the government refuses to pay. the company says air india should be treated as the indian government's alter ego and should be held jointly liable. there is a deal nearing, valuing $3 billion. the buyout is set to beat out rival bidders in a formal sale process. a decision has not been finalized yet. the group is owned by canadian firms.

at&t in talks to merge with discovery. a deal could be announced this week in a merger that would combine discovery's reality tv with at&t's media holdings, making the entity a major competitor of disney and netflix. the deal would like a departure from at&t's strategy of building its own media empire. shery: coming up, the outlook for bonds this week with a strategist. let's take a look at what prices are doing at the moment. we have had a lot of movement given the latest tweets from elon musk that tesla may sell or has sold its bitcoin holdings and implying that we have seen bitcoin lose ground more than 6% but still trading above that 45,000 level, also a lot of pressure for ethereum, and our bloomberg index is losing 10%. elon musk has been hitting back

at several users on twitter for criticizing his change of stance on bitcoin. this is bloomberg. ♪

shery: we are counting down to the start of trade in tokyo. a few things we are watching in japan. m&a talks involving sp energy, which is owned by softbank. it could be acquired in a deal valuing it north of $650 million. the ftc has cast doubt over the future of 7-eleven's future. plus, we will be watching honda at the open after profit outlook

missed estimates. paul: thanks very much. let's look at what to expect at the new trading week underway here in the asia-pacific. sophie in hong kong. sophie: after a choppy week, ships for asian stocks -- shifts for asian stocks. we are looking for japanese stocks. the nikkei back up above 28,000 points. switching it up, we have seen this value rotation take hold. value has been outperforming growth in asia since november. bloomberg intelligence noting that this could be sustained on rising inflation in support from commodities. in china, energy and materials topping main sectors. some investors are turning wary

of inflation hedges like banks with stock valuations for those above long-term averages. shery: let's turn to the fed, the cleveland fed president says the central bank policy is in a good place. she expects the recovery to be volatile. that is after retail sales installed in the u.s. after the latest wave of stimulus spending. she spoke to bloomberg about the factors she is watching. >> pent up coming back, vaccinations have been distributed more widely. that is a strong demand. we also have supply issues affecting the economy. this interplay between demand and supply is what we are seeing in some of the data, whether it be today's retail sales report or the labor market report. the volatility month-to-month is something we should expect. i think what is happening is we see the recovery continuing, it is just that we are going to have these month-to-month

changes depending on which factors are more dominant, is at the supply side were demand-side. i think the bottom line, we are at the beginning of this vaccination part of the recovery and i think we just have to wait and be patient and let the recovery continue. >> we just got the cdc advice that people don't have to wear masks anymore. people in boston are still wearing masks, they are in new york. do you think that reluctance to go out and spend is going to fade rapidly now? loretta: it is hard to say how rapidly. myself, i'm still wearing masks when i go outside. i think it is a good sign that we are getting to the other side of this and i think the vaccination still has some further way to go. i think we need to distribute them more evenly across the country.

as that continues, as we can relax mask wearing, all of that is on a good path to get us back to some semblance of normal. i think people are going to feel more comfortable be engaging. i am feeling more comfortable be engaging and i think i am representative of others. as things continue on and we intellectualize the fact that we have gotten vaccinated and we are protected, we are going to be more able and willing to go out and be engaged. i think we are going to see that over the rest of the year. mike: this is where i put in my plug to come visit here in cleveland under the next interview there. get a new nor i have had a chance to take into these retail sales numbers but the interesting thing is they are reported in dollar terms they would one would have -- terms. one would have thought there would have been an impact from the april cpi numbers. what was your reaction to that and the idea that inflation is accelerating more quickly than the fed anticipated?

loretta: i think we are seeing the clash between pent-up demand, the surgeon demand and some of the -- surge in demand and some of the supply issues. with that is the fact that the year-over-year numbers are incorporating those low inflation readings we had last year, as those come out of the numbers, we are going to see inflation going up. no doubt, we are seeing some supply constraints, in particular areas -- you are mentioning lumber earlier. there is commodity prices, energy prices. we are seeing those at inflation data. i think the question -- and inflation data. i think the question is is that going to abate over the rest of the year as supply comes back on , as some of the stimulus checks that people have are used up? i think we are going to see that play out in my baseline scenario

is we are going to have higher inflation this year, above 2%, but as some of those constraints -- i think we are going to see inflation go back down and we are going to have to monitor that. i am focused on inflation expectations because i think that is where you will begin to see, if those go up -- and they are going up a little bit now, we will have to see whether longer run ones are going up, and that is key to me in terms of where inflation is likely to go over the longer run. paul: the federal reserve bank of cleveland president speaking there. for weeks, fed officials have said they expect to see gender terrain inflation at the economy reopened and would not tighten monetary policy. for more analysis on how

inflation concerns are affecting the bond market, let's bring in a strategist. how is this debate playing out in the bond market at the moment? frances: i think the debate of this is major inflation, whether it is more persistent. we heard another comment that the fed is focusing on this transitory nature. the implication on the market, we have seen expectations for inflation to go up. regardless of the trajectory, the next payout would be important. however, it does appear that other investors are not convinced that inflation pressure will be persistent. nominal yields do not really go higher more rapidly.

not only the fed, but globally, focused on this. the fed seems to be behind the curve. the irony is that new inflation pressure and inflation expectations are already fairly high, so at this juncture, it makes sense to expect nominal to play some catch-up. it does not appear consistent with the economic outlook. we will expect real yield to go at least less negative. at the same time, supplies continue. that would continue to be a challenge and we would monitor option my option. on balance, i think there is bias towards the long-term. shery: are higher long and

nominal yields inevitable? you talk about inflation coming down a little bit but at the same time, you have supply chain disruptions, semiconductor shortage is, this rally in commodity prices. perhaps at 1.7 .1% in march -- at one point, 7.1% in march. frances: the thing is, there is indirection as well. it might do higher alongside or there might be a delay. from time to time, treasury yields go to a certain level, it becomes attractive to some investors, especially when the u.s. dollar the quiddity quite flesh right now. -- liquidity is quite flesh right now -- flush right now.

on the other hand is supply. with the fiscal stimulus deal on its way, we will expect supply -- it is actually a matter of supply. on balance, we believe there is a mild bias to the upside. the front end might be a different story at the moment. shery: did it make sense that the dollar did not maintain its gains after seeing a huge spike in cpi last week? frances: we see the broader trend a little mixed at this juncture. the interest rate is one factor. other yields and other markets

can also rise alongside. it night -- it might not move that rapidly. the dollar is also a factor. we would say the dollar is next. we might be more comfortable with dollar strength against the yen. paul: u.s. dollar liquidity at the moment, how do you see that affecting funding markets in asia? frances: the u.s. dollar is exceptionally fresh. it is not like that in the previous cycles. we haven't idiosyncratic factor in the u.s. with u.s. treasuries. -- we have an idiosyncratic

factor in the u.s. with u.s. treasuries. they are returning cash to the markets. supply chain u.s. dollar liquidity is there as well. these markets are supportive. there might be less need to review the cash balances. we are looking at late june or early july. shery: let's turn to china because we get a longtime rates this week. they have not moved in quite a while. do you buy into that narrative that perhaps we will see a little bit of tightening and things will get more difficult for chinese firms in the credit side of things? frances: the latest report

suggests that they are not worried about inflation. that should be seen as a reassurance to the market. there will be no u-turn in monetary policy. we believe the pboc will try to keep liquidity supportive. however, the rest of the market is waiting for a pickup and local government bond supplies. you may see relatively high bond sales in the months ahead. combining the central bank's stance and this supply outlook, we think the china government may be biased to steepening.

if you try to come i -- try to compare that china bond, it is more appealing than its peers. shery: great to have you on. coming up, we had to south korea, global funds are piling back into shortselling. tech and health care companies are in the firing line. this is bloomberg. ♪ is is bloomberg. ♪

shery: this is -- vonnie: this is daybreak: asia. microsoft reported bill gates need to step down from his position in 2020 over allegations with a -- allegations of a relationship with a female employee. the board hired a law from to investigate the affairs. gates is reported to have resigned before the and gritty -- before the inquiry started. singapore tightened lockdown measures to stop a surgeon -- a surge in cases. children returning to remote learning until the school term ends. the minister of education says the move is necessary.

taiwan says it is racing to contain its outbreak of the coronavirus while trying to avert a full lockdown. the government urged businesses to let staff work from home after the country reported 206 new local cases on sunday. authorities say resident are racing to stock up at grocery stores. the u.k.'s help secretary says that government is monitoring the very that originated in india. it will begin reopening starting monday. he wants variants could spread like wildfire. forest johnson said the strain could jeopardize the delisting of pandemic research and. south africa is expanding its vaccine rollout to health-care care workers and those over 60. the health minister says the government will begin a mass

vaccination effort at 87 sites using pfizer's shot. the country aims to inoculate 5 million senior citizens by the end of june. it expects a final decision on the resumption of johnson & johnson deliveries after they were delayed. 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. this is bloomberg. shery: global funds piling back into shortselling korean stocks after authorities listed a ban on the practice. our asia stocks border joins us. it has been two weeks since that pay on was removed -- since that ban was removed. how much shortselling are talking about? >> good morning. we saw a lot of shortselling going on by foreign investors. the ban was lifted.

we saw mostly retailers favoring tech and health care. a while back, we saw that trend dropping to about three or to 50 billion last friday -- 350 billion last friday. it also happened that foreigners were short record levels in the past four days. that has brought down the cost at one point to below 3100 level. the biggest hit has been some of the retailers' favorites, health care and technology sectors. paul: some of the nightmare scenarios that retail investors

were fuming, did those come to pass? >> yeah, so retail investors were worried that the resumption of shortselling would take a big tall. -- a big toll. south korea has been doing relatively better than its regional peers in the past. we saw this inflationary concern leading to a big selloff across asian markets. then we did see that some of the retailers' favorite stocks, companies like samsung electronics saw share prices down so far this month. we also saw some of the health care sectors and a smaller tech heavy stocks taking a toll as foreigners short.

paul: is shortselling going to remain a key issue in the coming days? youkyung: yeah, so retail investors are still watching that shortselling trend closely. it will be on their minds for a while. analysts say that the south korean companies, because they are posting one of the strongest earnings in years and many of them have reported better than expected earnings, especially in retail, strong fundamentals, and they are expected to approach recovery going forward. a lot of them have been saying that some of the worries about shortselling might have been overdone. even shortselling continues, that will be a chance to discover for the companies that

may have been overvalued and overshoot their prices. we see this daily shortselling trend every day relieved by that exchange at the end of the day and the data to be watched closely as retail investors tried to figure out which stocks to add more into their portfolios. shery: we are also watching president biden summit. should investors be on the lookout -- president biden's summit. should investors be on the lookout for anything given that north korea will be high on the agenda? youkyung: the first summit by president moon and president biden believe probably the biggest thing on the minds of south korean investors. i think they will be watching not just north korea, but considering vaccines because they want to hear more about what kind of partnership will come out from the united states

and south korea and they will try to find out what pharmaceutical companies are set to benefit from that announcement. they will also be watching some of the investments announcements that might come out from the summit. there has always been companies to better improve their u.s.-south korea partnership. that will also be watched. shery: thank you very much. asia stocks reporter. we have breaking news out of japan, ppi numbers, a growth of 3.6%, acceleration faster than expected from a revised upwards 1.2%. acceleration of producer prices in the month of april. when it comes to the month-to-month numbers, decelerating from the previous month, growth of 0.7%. it is beating expectations, accelerating at a faster pace.

we do have lower base from a year ago, also higher material prices. on the year on year basis, a big beach, 3.6%, ppi year on year. plenty more to come. this is bloomberg. ♪

paul: taiwan exchanges saying the covid development in taiwan is controllable. there was a surge in cases, 100 80 cases reported on saturday. the taiwan stock exchange asking investors not to overreact and the covid development is controllable. let's get a check of the latest business flash headlines. bitcoin plunged after elon musk imply that tesla may sold its bitcoin holdings. it fell below 45,000 for the first time in three months after elon musk seemed to agree with a twitter poet that said tesla should divest its bitcoin holdings. it was just the latest in a week of public statements. the national australia bank is opening a new headquarters in sydney despite its goal of consolidating its workspace to match flexible work arrangements.

it has been bringing back staff and is running at a capacity of 42%. market opens coming up next. stay with us. this is bloomberg. ♪

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shery: welcome to "daybreak asia." >> asia's major markets of just open for trade. more pain for bitcoin. elon musk is considering selling off his holdings in cryptocurrency. singapore and taiwan go into virus containment mode, adding

new restrictions to prevent the spread of covid variance. plus a blockbuster deal on the production in the entertainment industry. at&t is in talks to spin off its media business and merge it with discovery. shery: japan and south korea are coming online. >> we are seeing japanese stocks extend friday's gains. the yen is staying on the back foot above 109. it is the worst-performing g10 performance this year. on the bloomberg gauge it has followed -- fallen to a three year low. we're looking at the likes of bridgestone today and honda on the back of its results. turning now to south korea. i stopped there. jp morgan in the e.m. space and the kospi graining -- gaining ground.

we have seen holdings of korean -- equities come under pressure. we are seeing the korean won on the back foot against the greenback this morning. we are keeping a close eye on asian crypto related names. this after bitcoin was weighed at the weekend by elon musk's remarks. we are keeping an eye on japan's monex which owns a crypto exchange. as well as the first japanese company to make a big bet on crypto. these are crypto exposed names, as well. turning now to the open in sydney. checking in on the asx 200. resource names are on watch. be hbcu -- bh b-shares seeing a little change after a four-day drop. we're seeing ample shares jump in oil companies by more than

9%. that will lift the asx above the 7000 level. as brent crude is above $69 per barrel. -- and brent crude is above $69 per barrel. we are a week ahead of the exports report card on singapore. we are also watching f japan will enter a correction -- if japan will enter a correction and if taiwan will tighten restrictions. the stock exchanges calling for investors not to overreact. paul: thank you very much. let's get to our next guest. he says asian equities are too much of a discount from the u.s. he is the head of apac equity research at nomura. how far can these stocks

divergence go? >> one of the metrics we look at is the pe to growth network -- is widely known china is trading on a material discount. their trading on a p about 15 times, while the u.s. is trading at 23 times. there's a 30% discount for chinese equities. you get more earnings growth. in this case, we think the pe growth multiplier -- multiple for china actually 80% less for -- then the u.s.. paul: you say investors do not have enough exposure to china. are there any risks? there have been headlines around

the china tech crackdown. we're hearing from the solar power manufacturer in xinjiang that is refusing to take part in the labor program. what the government have something to say about that? are these risks turning investors off? guest: if you look at your traditional global investor located in new york or san francisco or london, typically that investor will have less than 5% of global portfolios sitting in chinese debt or equities. that is relatively modest compared to china's share of world gdp, which is 17%. what we take from a risk diversification point of view, you can buy exposure to china by being invested in apple, but to get direct exposure to china's economy, which is still growing faster than any other major developing economy, you need to be invested in china's domestic domestic stocks -- china's domestic stocks.

they are underweight. from a risk perspective, i think they are too big. shery: jim, we have just heard from taiwan that the covid development is controllable and they are asking investors not to overreact. this caught my eye given what happened last week that they felt the need to come out and tell investors not to overreact. how bad could it get? guest: we are seeing this in some markets. it is not unique to taiwan or china. we see it with the fed and the bank of england. you have central banks and lots of policymakers intervening in private markets. back in 1997 we had hkma by equities here. the bod -- boj's invested in the japanese stock markets. i think you have lots of actors involved. the mindful that the stock market for a country like taiwan or china is almost an indication

of soft power. again, with these global portfolios, tsmc is in all big investors'portfolios. the value of the stock market as a barometer to the health of the economy and the society. shery: we saw a lot of downside pressures on semiconductors and tech stocks given the location -- the rotation into cyclicals. can we expect a comeback given the long-term narrative that we are short of chips? guest: i think so. stock markets go from value into growth from time to time. these things come and go. i think what we have in tech, for example, tsmc. not only a

stock with earnings growth of 20% for a company of that magnitude, edges and norma's -- which is enormous. it gives you growth and income. shery: japan has been a favorite given its cyclical nature. what can we expect? guest: look for more agitation from shareholders to see management change, asset disposals, or mna. i know the domestic mna hasn't a challenge for japanese companies because getting due diligence done has been difficult. i agree see investors get together with management. if we see those investors challenge management on things like succession and evident policy, that will give them more confidence. paul: thank you so much for joining us today. i want to check in quickly on crown results -- crown resource.

very little change here in sydney at the moment. -- crown resorts. very little change here in sydney at the moment. this is on the report that crown says it is yet to form a view on the merits of stars merger proposal --star's merger proposal. that is crown's rival here in australia. crown is also facing the day one of an inquiry into its operations in the state of victoria, as to whether it breached regulations around that. crown shares unsure -- unchanged at the moment. let's get to vonnie quinn for a check at the first word headlines. >> the u.s. has joined other world powers and calling for an end to the violence in israel and the gaza strip. antony blinken spoke with his counterparts in saudi arabia, qatar, and each of.

present biden reasserted the right for israel to defend itself. india is bracing for a cyclone to hit its western coast today, forcing authorities to begin evacuation preparations and parts of the country that are overwhelmed by the second wave of the virus. it is expected to make landfall with wind speeds touching 175 kilometers per hour. india's prime minister told officials to ensure essential services. our hope and eight others are found -- this as authorities accused pro-democracy figures. albert ho says the group will plead guilty to attending an unauthorized a sunday -- assembly held in china's

national day. microsoft's board decided bill gates needed to step down from his position back in 2020 over allegations of a romantic relationship with a female employee which the board investigated. according to dow jones, the board hired a law firm to investigate the affair after a microsoft engineer alleged she had had a sexual relationship with gaetz over several years going back to the year 2000. global news, -- global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm vonnie quinn. this is bloomberg. shery: still ahead, jd.com's delivery arm is seeking to raise as much as 3.4 billion dollars in a hong kong ipo, the second largest listing in the city this year. we will get more details later. but first taiwan is racing to contain its worst outbreak of

the coronavirus while avoiding a full lockdown. this is bloomberg. ♪

shery: singapore and taiwan are tightening social distancing measurements in a bid to stamp out a flareup in cases. both locations have been seen as poster children for covid control success. our colleague joins us from singapore. start where you are. how bad is the situation? reporter: it is quite bad. it shows how difficult it is to remain virus free. how difficult it is to open your economy. we have 38 cases in singapore on sunday. that is the highest number in more than a year. adding to the more than 20 cases we saw on saturday. what is really worrying is the

fact that we have found the indian variant and some of these cases and also in cases unlike two other clusters, meaning there is spread happening in the community going undetected. what is also worrying for the government in singapore is the rise, the surge in cases among the young. those in schools are being infected, as well, which was not the case months ago. that is the reason why singapore is shutting its schools until the end of the month. it is also tweaking its strategy. it is looking to vaccinate those under 16 once it is cleared for that to happen. shery, there's been a delay in the terms of vaccine supply. this is been seen around the world. it is leaving singapore to tweak -- leading singapore to tweak its strategy. it is going to hold back on the

second shot, hoping to get more people in the lion city the first vaccination. it is tweaking as the trend seems to have changed. paul: we also heard from the taiwan stock exchange urging people not to overreact on the covid situation. what is the latest from taiwan? reporter: the panic we saw last week when the stock is change dropped by 8%. there is a record 206 cases over the weekend. that is prompting the government to encourage companies to allow their workers to work from home. one of the success stories, the poster child for how covid-19 can be cap -- can be contained, but not the case right now. it is trying to avert a lockdown .

if it sees cases averaging 100 per day, it might go into lockdown. local infections currently are about 206. that is causing some of the restrictions they are imposing right now. as far as social gatherings are concerned. they are limited to five people. 10 indoors -- 10 outside, five indoors. the authorities are trying to put a lid on it. we heard from the leader desk saying they have to put a lid on it to ensure growth can be sustained. paul: thanks very much. we want to get to a check on saudi group shares, trading higher by a over 70%. -- a little over 7%. coming in much stronger than expected.

just a shade under ¥13 billion a year ago. there was a very wide range between the two results, soy stronger result this year. you're still seeing a net sales result of ¥1 trillion and operating income of ¥93.5 billion. asahi is higher by 6.6%. elon musk continues to rick saw the price of bitcoin. we will discuss how bitcoin is trading next. this is bloomberg. ♪

paul: a wild ride for crypto

investors continues after elon musk implied that tesla may or has already sold its bitcoin holdings. joanna, elon musk wasn't vague in his remarks. what has he been -- was vague in his remarks. what has he been doing this weekend in the crypto space? reporter: he has been engaging in feuds with a number of people. the bitcoin crowd did attack him when he came out and said that tesla would not be taking bitcoin anymore for payments. he has been going back and forth with a lot of people. he did possibly imply that tesla might sell its bitcoin holdings. bitcoin was already on its way down by the time the tweak came out. -- tweet came out. shery: what about the broader crypto market?

what are we seeing in terms of pricing? reporter: most of the major cryptocurrencies are down in the past 24 hours. dogecoin is fluctuating. musk has been talking it up as he talks about the problems with bitcoin. while it is not spending dogecoin through -- to the moon, it is doing ok relative to some of the other cryptocurrencies. paul: what are the chances that bitcoin actually does -- that tesla actually sells its bitcoin, or has it already happened? reporter: it is possible. musk has this history of hinting about things and then actually going through with them, like talking about how he was tempted by bitcoin and then best -- and then tesla bought into it. it is possible. at the same time, it is a vague

tweet. who knows exactly what will happen? shery: there with the latest on cryptocurrency. let's turn to some corporate deals. at&t is said to be in talks to spin off its media business and merge it with discovery. bloomberg has learned a blockbuster deal could be imminent. su keenan joins us. we are talking about a huge portfolio of media assets. reporter: 80 $5 billion in assets. a vast portfolio. the idea according to those close in the matter is to combine the reality tv empire with at&t's vast media holdings and build a business that would be a major competitor to netflix and walt disney in this age of streaming. such a deal would make a major shift in at&t's prior strategy of assembling telecom and media

assets under one roof. this was a strategy accelerated in recent years. a deal could be announced as early as this week, sources say. the company is still negotiating what kind of structure the transaction would be taking place in. the details could change at any time and even talks could be called off. major sources have reported that multiple networks -- mobile networks have reported that the board meant -- met on sunday. this underscores the challenge telecoms companies such as at&t and verizon have had in making these media acquisitions payoff. at&t stock has lagged behind that of its rivals. we know that the ceo has really been focused on 5g technology and has been telling -- has been selling off nonperforming assets, cutting off -- cutting

down on staff towards that end. we know that at&t's holdings of cnn, hbo, time warner, tvs, warner bros., all of that is considered a gold mine of assets. paul: su, this spinoff would mark a rather surprising final chapter in at&t's rise to power in the media world. could you walk us through some of their more recent deals? reporter: the streaming revolution caught at&t by surprise. happening a lot sooner than they expected. there deal with directv and time warner never really got a chance to payoff. agency has spent $85 billion in the past few years. -- at&t has spent 85 to -- has spent 85 billion dollars in the past few years. in 2016 they bought time warner. by 2017, the trump administration had the justice

department taking a look that delayed this deal. by 2019, a big activist investor was already putting pressure on the company to get rid of directv. in 21, they spun it off. it is a reversal of the past few years. paul: su keenan there in new york. you can read more about at&t's plans to take on netflix in today's edition of "daybreak." look on your terminals. this is also available mobile on the bloomberg anywhere app. let's get a quick check on the latest business headlines. the delivery arm of e-commerce giant jd.com is seeking to raise as much as 3.4 billion dollars in its hong kong initial public offering. they will offer 609 .2 million shares.

jd logistics will be the second largest ipo in the city this year. lg is investing 35 million dollars -- billion dollars to strengthen its supply chains. they produce ultrathin copper foil. they say the parts are key to manufacturing ev batteries and demand is expected to grow. the chinese company posted a fourfold jump in its quarter sales. air india is going to court in new york overpayments -- over eight tax dispute with the indian government. they won the arbitration against india last year. however, the government refuses to pay. in its court following -- court filing, they said it should be held jointly liable for its debts.

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paul: breaking out of singapore. oil exports for the month of april at a significant miss. the expectation was for an 11.5% gain. electronic exports rose 10.9%. nonoil exports are something of a mess. no reaction from the singapore dollar the moment.

shery: it's another busy week for asia economic data. beginning with china's april economic activity data along with thailand's gdp for the first quarter. on tuesday japan reports its first quarter gdp. but covid is still the main desk and -- risk and differentiator for each economy. michael, it's great to have you with us at a time when we are seeing continued rises in cases in singapore and taiwan. how important is it still for these economies -- how important is the pandemic and access to vaccine? guest: until you have vaccinated the vast majority of your population, you are not really safe. singapore has done better than

any other economy in asia. a third of the population has received one dose of vaccine. they are giving about 4000 doses per day. they are well on track to give set -- to get to 70% of the inoculation -- to get to 70% of the population being inoculated by september. they are only a 35% today. we are seeing cases emerge even in singapore. taiwan, as he said. i think the taiwanese believed that covid was no longer an issue for them. they have not begun to inoculate their population really. no country is completely closed off to travelers. the risk remains for everyone. what we do see in terms of economic impact is countries struggling the most with covid's cash with covid, india, the philippines, those economies are recovering much more slowly than those that have been more successful.

shery: what will the impact look like in terms of the economy to those countries that have not really experienced severe economic restrictions -- severe movement restrictions, because of covid. are you expecting pence up demand -- pent up demand once vaccinations are done? guest: we do expect that. that will not be so much of a benefit in this part of the world. maybe late this year in singapore and china, as people feel significantly freer to go back to a more normal existence. if you look at the u.s. and europe, who are on track for population immunity by june or july, we are certainly expecting that as research and's are removed. and the u.k. will likely remove most research and by the end of june -- the u.s. and other parts of europe are progressing rapidly down that route -- do

expect those economies to grow. at the fastest pace we have seen. 10% annualized growth. as people travel more and spend more freely and go back to a normal existence. shery: even during the pandemic during asia, is that we will see as well? guest: what the u.s. and european picture tells us is that exports, which as you have said have grown much faster than respect it over the last year -- the risk is a rise even faster as the u.s. and europe feed this growth surge. we will see faster growth. at the end of this year at the u.s. and european economies will be growing faster than asian economies, including china. exports will be a very powerful source of support for regional growth. where covid remains a real constraint on domestic activity, imports will not keep pace with

exports. we are likely to see even higher trade surpluses. those have been in many countries at record levels over the past year. trade surpluses will get even stronger, larger, currencies will get stronger. you'll see an increasingly distorted economic picture in these economies, where anything related to external demand will do very well and in many economies, anything related to domestic demand will continue to struggle -- possibly for another couple of years. paul: perhaps one exception to domestic demand might be china, we are expecting another bump in retail sales numbers today. industrial production numbers are well. where you see this rapid growth coming off a low covid base? how much more is left in the tank in terms of these stellar numbers? guest: precisely. when we look at the dated today, we are expecting all of these year on year comparisons to come down. the worst of the covid pandemic

in china was january through march last year. now you are starting -- we're getting april data. gdp growth was 18.3%. -- 8.3% in the first quarter. domestic demand has rebounded quite well in china. we had this initial post lockdown surge. then gradual growth over the last nine months. the first quarter to be honest was a little disappointing. that seems to be largely because the government did discourage people from traveling for the spring holiday. in the second quarter, in sequential terms, we see stronger growth in q2 then we are forecasting, as people have been able to travel during the holidays earlier this month area i think in growth impact, that disappointment in q1 is offset with stronger-than-expected

growth in second quarter. as we look at the second half of the year, we will see gdp growth back down below 6%, industrial growth rate coming down below 10%. retail grossing close to 10%. -- retail growth staying close to 10%. it will look much more like the pre-covid pattern. you will still see significant distortions in domestic demand that you will not seen china in other asian countries. paul: we will be breaking those retail sales and industrial output numbers out of china a little later on. this is bloomberg. ♪

>> this is daybreak asia. singapore has tightens its lockdown measures as it attempts to stop the surgeon cases that saw new infections rise to 38 on sunday. most schools were closed from wednesday, with children returning to remote learning until the term ends. the ministry of education says the move is necessary to tackle mutations that attack younger children. taiwan is racing to contain its

worst outbreak of the coronavirus. they are trying to of our a full lockdown. -- to avert a full lockdown. there are 206 local cases on sunday. taipei is in a soft lockdown with residents rushing to stock up at grocery stores. south africa is expanding its vaccine rollout to health care work as test health care workers and those over 60's. it will begin mass taxation at 87 sites over the country -- in the country with the pfizer shot. china's security rep -- securities regulation is tracking market any after suspicions moves in the equities

markets. they have vowed to take a zero tolerance stance towards market manipulation and insider trading. regular says it has investigated violations in 65 cases since 2020. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm vonnie quinn. this is bloomberg. paul: china's solar injury -- industry is facing increased scrutiny in xinjiang. as potential sanctions loom, one of the biggest factories has broken ranks and let journalists inside. we report from xinjiang. reporter: in most other parts of the world factory visits are routine. not here. we are in xinjiang, a region of china where the government has been accused of numerous human rights abuses, including forced

labor in its crucial solar industry. china denies the claims. now one of the country's biggest solar companies is betting on greater transparency to neuter the criticism. they have not been directly linked to the labor transfer program. this is the first solar factory to open its doors to foreign media since the allegations of forced labor in the sector surfaced. by me you can see the poly silicon material that will ultimately end up in solar panels all over the world. business has never been better. demand for the u.s. listed companies -- company's product is so song -- is so strong that it is running at full capacity and margins are above 60%. but the stock price is lagging, with a region synonymous with abuse allegations.

it risks being tainted by associations. it's cfo is trying to reassure anchors investors. >> most of the impact is on investor perception, which has an impact on our share price. which is discounted because of this. reporter: they are lining up auditors to vet its operations. executives hope an independent assessment will help insulate the firm from u.s. sanctions on the xinjiang solar industry. >> we have never participated in any of the labor transfer program. reporter: will you ever, after government was to ask you and say you need to be part of this program? >> we are not obligated as a company to follow any of the government orders unless we want to. morally and principally, we are a company that has very high

integrity standards. so we will not participate in these types of programs. reporter: selecting auditors is just a first step. getting them into china and securing access to key facilities could be challenging, given the closed nature of this highly surveyed region. what is clear is that this issue is not going away anytime soon. in xinjiang, tom mackenzie, bloomberg news. shery: a mixed picture in markets across asia. let's turn to sophie. reporter: we are seeing mixed moves in japan. honda is falling on its profit outlook, missing estimates. asahi group shares we are seeing rally, jumping the most since 1990. over and seoul -- over in seoul,

the kospi moving up. over in sydney, the asx 200 is getting some gains. oil refinery players are gaining ground in the government's fuel support package. we have the dollar crawling back . the korean won is on the back foot against the dollar. the singapore dollar is under pressure. april's export growth data is missing estimates this monday. the offshore yuan is trading around 644 ahead of the activity data we will get from china. when it comes to the renminbi, seeing advantages over the next couple of months until weakening in the medium-term, this is the pboc is seen as not wanting

major capital flows in either direction. paul? paul: thanks very much, sophie. to get you some breaking news at the moment, goldman sachs apparently hiring more than 300 people in china and hong kong to step up expansion. we are expecting some more information on that story shortly. the bank is in the process of hiring three or 20 staff, including 70 to focus on investment banking. according to a person familiar with the matter, they have been on a hiring binge in china. more on the story later. health authorities are starting to accept something argued by many researchers for more than a year, that the coronavirus can spreads are the air. the who and the cdc tweaked their advice, which now calls for an overhaul of ventilation systems. let's go to our senior editor for more. what's the latest on this? reporter: those agencies now

recognize that covid can spread through the air in what is called aerosols. the hair -- air we exhale contains particles. the biggest ones are the one we can see, spittle. aerosols are invisible to the naked eye. they can be carried further. these are the pathogens in the air that health authorities now recognize as being a force of concern. shery: jason, when i hear this headline i am thinking, why this news? it is been one year. even through common sense, people wearing masks across asia have fewer infections. why is it taken authorities so long to accept this? reporter: the evidence has been gathering over the past year. we are seeing people infected and hotel quarantine,

restaurants, choir practice, things like that. this body of evidence has persuaded authorities to accept that aerosol transmission is occurring. mitigating that threat is more expensive. requires different procedures and levels of infection control. there is a cost associated with that recognition. paul: how should people be thinking about this and modifying their behavior, when considering the risk posed by aerosol transmission daca -- transmission? reporter: it is recognizing where transmission is more likely to occur, confined indoor spaces with poor ventilation. being outdoors, being in areas where there is fresh air, will all mitigate the risk substantially. shery: jason gail there running us there in melbourne. we do have in a work -- an alert, we are seeing futures

falling more than 3% in taiwan after the virus restrictions. we are watching the taiwanese market very closely, given that they fell into correction last week. they are very tech heavy and reliant on tsmc. we saw that rotation into cyclicals really affecting taiwan. we continue to see tighter restrict and's over virus cases on the island. we will have more to come. this is bloomberg. ♪

paul: let's get a quick check of the latest business headlines. bitcoin plunged after elon musk implied on twitter that tesla may sell or have already sold its bitcoin holdings. cryptocurrency fell below $45,000 for the first time in almost three months. muska seem to agree with this winter vos -- with the twitter post that said he should divest with his holdings. sources tell us at&t is in the talks to spin off its media business and merge it with discovery. the deal could be announced this

week. the merger would combine discoveries reality tv empire with at&t's vast media holdings, making the media entity a major competitor to disney and netflix. the deal with -- what mark departure -- the deal would mark a departure from at&t's strategy of building its own media empire. national australia bank is opening a new headquarters in sydney, despite its goal of consolidating. around the world, companies arcs more new ways to run their businesses around the pandemic. nab has been banging -- has been bringing back back staff. shery: goldman sachs is in the process of hiring new staff. this as that company goes on an unprecedented hiring speed --

hiring spree in mainland china and hong kong. how far along are we in this hiring spree? reporter: they are in the process of basically having signed up or having signed up these three to 20 new people, including 70 to focus on investment banking. they also have plans to add another 100 employees through the rest of this year. it goes hand in hand with the other investment banks, who are also hiring in mainland china, as they all pile into this market, which is slowly opening up to investment banking, securities firms, asset management. for goldman, it is part of a five-year plan they launched late in 2019, which was to double their workforce in china to 600. that's on the mainland.

they have a lot of people in hong kong, as well. paul: the bank in the process of hiring greater 20 staff. where they going to be doing? you mentioned a longer-term plan. we expect to see more stories like this in the near future? reporter: i think a lot of them will be focused on dealmaking. the firm is also expanding in other things, including setting up an asset management deal on the mainland. it goes hand in hand with what we are seeing. competitors, as well, including credit suisse, ubs, hsbc, all hiring thousands. there is a flight for talent going on and it comes after china's economy powered out of the pandemic. some of the plans for hiring or put on hold a bit last year. we are seeing a pickup across

the board now. it is interesting, because all of them over the past few years have been saying that getting enough talent in china to fuel this expansion would be the hardest, and it seems that goldman sachs is making progress in finding available people. paul: jonas bergman. let's get over to sophie now for a check on what to watch as the trading week gains momentum. sophie? reporter: we are watching jd.com with its logistics armed seeking a hong kong ipo of up to $3.4 billion. we are also keeping an eye on chinese refiners as china's consumption tax on oil imports should be a major positive for big players. and we are keep an eye on a

company warning that the global chip crunch will worsen this corner. shares under pressure in the wake of that, down 20% from the march i. -- march high. we are seeing taiex futures losing ground by more than 2.5%. this as taiwan tightens virus curbs. the stock exchange operator is saying that investors should not overreact. in singapore, we are watching to see if they will enter a correction following the ruptures we've seen in singaporean stocks. singaporean banks say they are more cautious in plays on commercial reefs. shery? shery: also coming up, we get insight and marketing -- insight in navigating market volatility.

our market coverage continues. " bloomberg markets: china open" is next. this is bloomberg. ♪

tom: good morning. not :00 a.m. in beijing and shanghai. we are of course counting down to the open of trade in the chinese mainland and hong kong. our top stories, china continues to drive global growth. data due in the next hour is expected to show its factory led recovery likely broadens to consumers. asian stocks start the week on firm